Skip to main content


District Court of Appeal, Fourth District, California.

KALUZOK et al. v. BRISSON et al.

Civ. 3414.

Decided: July 26, 1945

Walker and Horn, of Long Beach, for appellants. Sarau, Thompson & Colegate, of Riverside, for respondents.

This is an appeal from an order denying the defendants' motion to transfer the action from Riverside County to Los Angeles County. It is conceded that the individual defendants reside in Los Angeles County and that the corporate defendant has its principal place of business in that county.

The complaint alleges that the plaintiffs purchased certain real property in Riverside County from the individual defendants for $55,000; that they gave those defendants a note for $38,500 and paid the balance in cash; and that this note was secured by a trust deed upon the property in which the corporate defendant was named as trustee, and the individual defendants were named and beneficiaries. Briefly stated, it is then alleged that the plaintiffs were included to purchase the property at this price by their reliance upon certain representations of fact made by the individual defendants; that these representations were false and unture; that the real property at the time of the purchase was worth $35,000 and no more; and that by reason of the false representations the plaintiffs have been damaged in the sum of $20,000. The prayer is for damages in that amount and that any sum recovered be ordered applied on the unpaid balance of the note secured by the trust deed.

The sole question presented on this appeal is whether this action is one coming within the provisions of subdivision 1 of section 392 of the Code of Civil Procedure or whether it is governed by section 395 of that code. The appellants contend that since the action is based on fraud it falls within the provisions of section 395 and they rely on cases holding, in general, that where fraud alone is relied upon the action is transitory rather than local in nature.

Whether an action is local or transitory depends upon its character as disclosed by the complaint and upon the character of the judgment which could be entered in case of a default. Eckstrand v. Wilshusen, 217 Cal. 380, 18 P.2d 931. While the complaint here alleges fraudulent representations these allegations are inseparably connected with allegations as to the ownership of the land and the giving of the trust deed under certain conditions. The real purpose of the action is to establish that, because of the conditions surrounding its execution, the amount and extent of the interest in the land which is represented by the trust deed is smaller, and the interest of the trustors is greater, than would otherwise appear. While the prayer includes a request for the allowance of damages it is prayed that any amount so allowed shall be applied upon the unpaid balance called for by the note and trust deed. It seems clear that had the appellants defaulted no personal money judgment could have been entered in favor of the respondents. The only judgment for the respondents possible in that event would have been one which would have had the effect of reducing the appellants' real interest in the property and correspondingly increasing that of the respondents.

There is no question that the respondents, as trustors, had an interest in this real property. Bank of Italy, etc., Ass'n v. Bentley, 217 Cal. 644, 20 P.2d 940. Subdivision 1 of section 392 provides that the county in which the real property is situated is the proper county for the trial of certain actions, including those for the recovery of real property or an estate or interest therein, for injuries to or partition of real property, and for the foreclosure of liens and mortgages thereon. The clause relating to the recovery of real property or of an estate or interest therein also contains the provision ‘or for the determination in any form, of such right or interest.’ This is a broad provision which seems intended to cover other cases, no matter what their form, which actually involve a real or substantial interest in real property although, technically, they may not fall within the classes which are specifically named. In Eckstrand v. Wilshusen, 217 Cal. 380, 18 P.2d 931, section 392 was held applicable because the substantial nature of the action was to cancel a deed on the ground of fraud. That section has been held applicable in an action to declare a trust in real property (Donohoe v. Rogers, 168 Cal. 700, 144 P. 958), in an action for the reformation of a contract for the sale of real property (Franklin v. Dutton, 79 Cal. 605, 21 P. 964), and an action for the specific performance of a contract for the sale of land (Grocers', etc., Union v. Kern, etc., Co., 150 Cal. 466, 89 P. 120). It was so held in Sloss v. De Toro, 77 Cal. 129, 19 P. 233, 234, an action to set aside, on the ground of fraud, a sale of real property made by an administrator. In that case, the court said:

‘The question then is, did this action require the determination, in any form, of a right or interest in real property?

‘It seems to us that it did. The main purpose of the action evidently was to have an alleged fraudulent sale of land set aside and the title revested in its former owners. This purpose could only be accomplished by showing—First, that the plaintiff had an estate or interest in the land; and, second, that the defendants had wrongfully tried to deprive him of that interest. If the action had been ejectment, or to quiet title, it would not more clearly have required a determination as to plaintiff's right or interest in the property.’

In Stanley v. Barney, 123 Cal.App. 139, 10 P.2d 1022, 1023, the court said: ‘While it may be true, as appellants contend, that the relief which might be granted under the complaint would operate in personam, we are of the opinion that the action would determine, in some form, the right or interest of plaintiff in the real property. The court would be called upon to determine whether or not plaintiff was an heir of the decedent grantor. As such an heir he had the right, in the absence of administration, to attack the transfer. 9 Cal.Jur. 212. Thus his interest was an issue. To say that the real property was not the subject of the action would be to indulge in a mere quibble. It is a direct attack upon the title.’

In Franklin v. Dutton, 79 Cal. 605, 21 P. 964, an action for the reformation of a contract for the sale of certain land, the court said: ‘If it be an action for the determination, in any form, of a right or interest in real estate, situated in Santa Barbara county, it must be tried in that county.’

In Hannah v. Canty, 1 Cal.App. 225, 81 P. 1035, 1036, it is said: ‘The action is therefore to be regarded as having for its sole object to establish a trust in the lands, and the accounting asked for as merely incidental to the action, which necessarily involves the determination of the amount due from plaintiff.’

The respondents here elected to stand on their contract and to make up for any loss caused by misrepresentations by seeking a reduction in the amount which they owed on the trust deed. Regardless of any personal element, the real and substantial nature of the action is to reduce the interest of the appellants in the property and to increase that of the respondents. This is an attempt, in some form, to determine the exact right or interest of the respondents in the real property. If this were an action to cancel this deed of trust there would be no question but that section 392 would apply. No good reason appears why it should not be equally applicable in an action to reduce the amount of interest in the land represented by the deed of trust, since that statute governs an action for the determination, in any form, of a right or interest in real property.

In their reply brief, the appellants suggest that while the corporate appellant, as trustee, held the legal title to the property the individual appellants, as beneficiaries, were interested only in the note and had no legal or equitable estate in the real property, and that it follows that any reduction in the unpaid portion of the purchase price would not decrease the interest of the beneficiaries or increase the interest of the respondents whose title, being equitable, would not be affected by the amount due on the note. This argument not only ignores the real and substantial interests of these various parties but the applicability of section 392 does not depend upon whether or not, technically speaking, certain of the appellants have an interest in this land but it depends upon whether the respondents, who unquestionably have an interest in the land, have brought an action which is one ‘for the determination in any form, of such right or interest.’ For the reasons above given, it must be held that the action is one of that nature.

The order appealed from is affirmed.

BARNARD, Presiding Justice.

MARKS, J., concurs.

Was this helpful?

Thank you. Your response has been sent.

Welcome to FindLaw's Cases & Codes

A free source of state and federal court opinions, state laws, and the United States Code. For more information about the legal concepts addressed by these cases and statutes visit FindLaw's Learn About the Law.

Go to Learn About the Law

Docket No: Civ. 3414.

Decided: July 26, 1945

Court: District Court of Appeal, Fourth District, California.

Get a profile on the #1 online legal directory

Harness the power of our directory with your own profile. Select the button below to sign up.

Sign up

Learn About the Law

Get help with your legal needs

FindLaw’s Learn About the Law features thousands of informational articles to help you understand your options. And if you’re ready to hire an attorney, find one in your area who can help.

Learn more about the law
Copied to clipboard