[ISBA RealEstate] General Execution sale
<realestate@iabar.org>
Monday May 21, 2018 17:37


Mr. Anfinson, your client cannot qualify for statutory lis pendens benefit.  
No 'petition...affecting real estate' was filed separately.
All your client did was levy execution upon a post-dissolution judgment. 
(From your description I suspect the judgment arises from a post-divorce ruling in the dissolution action--is that the case?)
Action that produced that judgment apparently was not filed as 'affecting' the real estate in question.
Husband's real estate likely would not have served as 'the subject matter' of the action.

617.10  Real estate -- action indexed.
1.  When a petition...affecting real estate is filed, the clerk... shall index the petition...

617.11  Lis pendens.
1. When a petition...affecting real estate is indexed pursuant to section 617.10, [the] action shall be considered pending so as to charge all third persons with notice of its pendency, and while pending no interest can be acquired by third persons in the subject matter thereof as against the plaintiff's rights.


IMHO if you can draw the competing judgment lienholders into court and establish your client's 'equitable' claim to the specific property, then--perhaps--you may obtain priority for the wife's claim.

One creditor who brings an equitable action to subject property to the lien of his judgment may gain lien priority as against other creditors having general judgment liens without acquiring specific liens upon the property.
Bridgman v. McKissick, 15 Iowa, 260 (1863); also Fordyce v. Hicks, 76 Iowa 41, 40 N. W. 79 (1888); explanation above appears in Albia State Bank v. Smith, 141 Iowa 255, 119 N.W. 608 (1909).

46 Am. Jur. 2d Judgments § 351 (2018)
§ 351. Priority of judgment liens as to equitable interests

A judgment lien on all real estate of the judgment debtor does not prevail over prior equitable claims on specific property of the debtor; to the contrary, the judgment lien is subject to all equities existing against the property in favor of third persons.1 A judgment lien is a lien on the interest the debtor has in the land,2 and a prior equitable interest will prevail over a judgment lien.3 A judgment lien is subject to all other existing liens that are valid as to the landowner, because the judgment lien does not attach to the land, but only to the judgment debtor's interest therein.4 Consistent with the common-law rule that priority in time gives a lien priority in right, a prior equitable interest or lien will prevail over a judgment lien while the judgment lien will generally prevail over subsequently manifesting equitable interests or liens.5 However, an equitable lien, once decreed by a court, may in certain circumstances take priority over a preexisting judgment lien.6
Under the law of some jurisdictions, the existing equity need not be of record7 and lack of notice to the judgment creditor is immaterial, on the theory that a judgment lien holder is not in any sense an innocent purchaser.8 In other jurisdictions, however, a judgment lien creditor has priority over a person who holds an unrecorded equitable interest in the real property.9
FN Gurske v. Strate, 165 Neb. 882, 87 N.W.2d 703, 71 A.L.R.2d 1044 (1958).
As to attachment of a lien upon an equitable interest, see § 342.
FN2 Amici Resources, LLC v. Alan D. Nelson Living Trust, 49 N.E.3d 1046 (Ind. Ct. App. 2016).
As to real estate subject to judgment lien, see § 337.
FN3 Arend v. Etsler, 737 N.E.2d 1173 (Ind. Ct. App. 2000).
A purchaser's equitable interest in real estate was superior to that of lien holders only to the extent that the purchaser's interest was prior to the entry of the judgment liens. Splittorff v. Fehn, 810 N.E.2d 385 (Ind. Ct. App. 2004).
FN4 Farm Bureau Mut. Ins. Co. of Arkansas, Inc. v. Guyer, 2011 Ark. App. 710, 386 S.W.3d 682 (2011).
FN5 Amici Resources, LLC v. Alan D. Nelson Living Trust, 49 N.E.3d 1046 (Ind. Ct. App. 2016).
As to establishment of priority of judgment liens, generally, see § 348.
FN6 In re Yelverton, 477 B.R. 282 (Bankr. D. D.C. 2012), stay pending appeal denied, 2014 WL 285344 (Bankr. D. D.C. 2014) and aff'd, 527 B.R. 557 (D.D.C. 2014), aff'd, 2015 WL 1606965 (D.C. Cir. 2015).
FN7 In re Cedar Funding, Inc., 398 B.R. 346 (Bankr. N.D. Cal. 2008) (although unrecorded, a recognized equitable lien has priority over the liens of subsequent attaching creditors or judgment creditors).
FN8 Echo, Inc. v. Stafford, 21 Ark. App. 201, 730 S.W.2d 913 (1987); Texas American Bank/Levelland v. Resendez, 706 S.W.2d 343 (Tex. App. Amarillo 1986).
As to priorities between judgment liens and interests of prior vendees and grantees, see § 352.
FN9 Shearton Service Corp. v. Johnson, 5 P.3d 395 (Colo. App. 2000).
Even if an equitable distribution order in a divorce action constituted a deed of conveyance transferring an ex-husband's interest in real property to the ex-wife, that order did not affect the priority of the lien against the property that was created by the lien holder obtaining a money judgment against the ex-husband in an action brought by purchasers of the property to quiet title, as the equitable distribution order was not properly recorded. Dabbondanza v. Hansley, 791 S.E.2d 116 (N.C. Ct. App. 2016).

I don't know that Iowa Courts would follow or apply section 351 of 47 Am.Jur2d. Judgments. But it might be worth while to try, so I offer this option. 
See Garton v. Garton, 533 N.W.2d 828 (Iowa 1995)(child support judgments are not, *as a matter of public policy*, payable ahead of other judgments in competing levies against a specific res)

Absent such a showing, after notice and hearing to all competing lienholders, I think your client stands as just another competing judgment creditor among several in like position.
All the problems with competing judicial liens apply to her.  See Garton; also Production Credit Ass'n of Midlands v. Farm & Town Industries, Inc., 518 N.W.2d 339 (Iowa 1994), and similar cases.
Race to the courthouse for levy of execution...

Cook v. Dillon,9 Iowa 407 (1859); Lippencott, Johnson & Co. v. Wilson, 40 Iowa 425 (1875); also 
Kesterson v. Tate, 94 Iowa 665, 63 N.W. 350, 58 Am.St.Rep. 419 (1895):
"We have held that when judgments in favor of different parties, and against the same defendant, are recovered on the same day, the judgment creditor first issuing execution and levying upon the debtor's property acquires a prior lien thereon. Cook v. Dillon, 9 Iowa, 407; Wilson v. Baker, 52 Iowa, 428, 3 N. W. 481; Lippencott v. Wilson, 40 Iowa, 425. And it has been held that, when judgments held by different persons are not a lien upon property, the judgment creditor who first issues execution and levies upon the property secures a prior lien. Lathrop v. Brown, 23 Iowa, 48. 

David Hanson
Hofmeyer & Hanson PC
Fayette, Iowa




----- Original Message -----
From: "Larry Anfinson" <realestate@iabar.org>
To: realestate@iabar.org
Sent: Monday, May 21, 2018 4:44:21 PM
Subject: [ISBA RealEstate]  General Execution sale

Ex-wife obtains judgment v. Ex-husband for substantial amount based on his failure to abide by Dissolution Decree. He had been ordered to  make  mortgage payments on her residence. Court order further states that  another real estate parcel ( a six-plex) owned by Ex-husband (which had been acquired during the  marriage in Husband's name using loan proceeds from that same mortgage on her residence ) shall be sold and sheriff sale proceeds were to be used to apply to the mortgage. Date of this judgment is 5/3/17 . General Execution was issued on 7/31/17 and Sheriff's Sale was held on 9/20/17. Ex-Wife purchased the real estate at Sheriff's Sale and one year redemption was applicable since Ex-Husband resided at the property. There are judgments v. Ex-Husband entered prior to 5/3/17 , and judgments entered v. him after that date.  I would assume any judgments entered v. him prior to her judgment would be superior to her purchaser's interest (assuming he does nor redeem and she gets the Sheriff's Deed in late September) , but does lis pendens , or a similar concept , apply to cut off any subsequent judgments from attaching to this real estate? I did check with the Clerk of Court, and she did not enter this action in any separate index. Thanks.


Larry L. Anfinson
ANFINSON & LUCE, P.L.C.
726 W. 4th Street
Waterloo, IA 50702
Phone:  (319) 235-9507
Fax:  (319) 233-8041