[WSBARP] What are "proceeds" on sale of real property

[Kaitlyn Jackson]

Thank you, everyone! This was a valuable discussion and a great
demonstration of why this brain trust is so useful. I think I have what I
need here to help resolve the issue.

Kaitlyn

On Thu, Sep 26, 2019 at 12:37 PM Eric Nelsen <Eric at sayrelawoffices.com>
wrote:

> I don't think you will find a good definition of "proceeds" that will
> resolve the problem. A judgment is just a lien and there is no basis for a
> divorce court to "super-prioritize" its payment. I think that most likely,
> what title is actually saying is that the judgment, which is a lien against
> the property, can't be released unless it's paid in full. Unless it's paid
> in full, the Seller can't deliver clear title to the Buyer.
>
>
>
> But you represent the broker, so I don't think this is really your legal
> problem to solve--it's the problem of the Seller/judgment debtor. Broker
> should just insist on being paid full commission.
>
>
>
> Escrow hopefully is already in touch with the ex-spouse judgment creditor
> to confirm the full amount owing under the judgment. The Seller needs to
> contact the ex-spouse judgment creditor, explain the situation, note that
> if the sale fails they get nothing, and ask if they will agree to release
> the judgment lien on the property in return for receipt of all net proceeds
> even though that won't quite pay the maintenance in full. (Release of the
> lien on the property would not extinguish the unpaid portion of the
> judgment; it just removes the encumbrance on that particular property.)
>
>
>
> Really, the contempt language in the judgment is directed against the
> debtor. If the debtor tries to divert her/his net proceeds anywhere other
> than payment of the judgments, the court can hold the debtor in contempt.
> There is no realistic basis for the court to hold escrow or any third party
> in contempt.
>
>
>
> If Seller wilfully lets the sale fail, I think Broker could have a claim
> for breach of the listing/commission agreement. (Maybe not, if the Seller
> makes a genuine effort to get the creditor's release, but the creditor
> refuses.)
>
>
>
> I just saw Jennifer Johnson's post--I think she said it more succinctly
> than I did.
>
>
>
> Sincerely,
>
>
>
> Eric
>
>
>
> Eric C. Nelsen
>
> SAYRE LAW OFFICES, PLLC
>
> 1417 31st Ave South
>
> Seattle WA  98144-3909
>
> phone 206-625-0092
>
> fax 206-625-9040
>
>
>
> *From:* wsbarp-bounces at lists.wsbarppt.com [mailto:
> wsbarp-bounces at lists.wsbarppt.com] *On Behalf Of *Kaitlyn Jackson
> *Sent:* Thursday, September 26, 2019 11:49 AM
> *To:* WSBA Real Property Listserv
> *Subject:* Re: [WSBARP] What are "proceeds" on sale of real property
>
>
>
> Probably not this close to closing.
>
>
>
> But I would really like to know what, if any, is the definition of
> "proceeds" in this context. If proceeds mean price minus costs. And costs
> include commission to brokers, then Title's position is incorrect.
>
>
>
> Kaitlyn
>
>
>
>
>
>
>
> On Thu, Sep 26, 2019 at 11:36 AM Douglas Scott <doug at rainieradvocates.com>
> wrote:
>
> Can you get this quickly on the family law calendar and petition the court
> for approval of the sale and distribution to the ex?
>
> *DOUGLAS W. SCOTT*
>
> Rainier Legal Advocates|LLC
>
>
>
> *Eastside Office*
>
> 465 Rainier Blvd. N., Suite C | Issaquah, Washington 98027 | 425.392.8550
> (tel) | 425.392.2829 (fax)
>
>
>
> *Seattle Office*
>
> 12055 15th Ave NE | Seattle, Washington 98125 | 206.552.0785 (tel)
>
>
>
> www.rainieradvocates.com f/k/a
>
> www.davisscottlaw.com
>
>
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> On Thu, Sep 26, 2019 at 11:29 AM <nestor at pplsweb.com> wrote:
>
> Unless there is case law to the contrary (that I have not seen) those
> amounts come out of the net proceeds to the Seller.
>
>
>
>
>
> *Nestor Gorfinkel, Attorney at Law *
>
> *Admitted to practice law in Washington & Florida *
>
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>
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> *From:* wsbarp-bounces at lists.wsbarppt.com <
> wsbarp-bounces at lists.wsbarppt.com> *On Behalf Of *Kaitlyn Jackson
> *Sent:* Thursday, September 26, 2019 11:13 AM
> *To:* WSBA Real Property Listserv <wsbarp at lists.wsbarppt.com>
> *Subject:* [WSBARP] What are "proceeds" on sale of real property
>
>
>
> Brain trust -
>
>
>
> Client is real estate broker. Broker has entered into contract with
> Seller. Sale of property is pending. Title discovers divorce decree
> judgment with the following language in favor of Seller's ex-spouse:
>
>
>
> *It is further ordered that any proceeds from the pending sale of
> Respondent’s home shall first be applied to his past due child support ....
> judgment of $$$; any remaining proceeds shall be applied to his past due
> spousal maintenance judgment of $$$. Failure to apply the proceeds as
> directed by this order shall be a basis for contempt. *
>
> I took out the amount for privacy reasons.
>
>
>
> It is discovered that if the ex-spouse's judgment is paid out of the
> proceeds of the sale that not enough money will be left to pay the brokers
> their commission. Aren't the commissions supposed to take priority as a
> service rendered?
>
>
>
> Would love to hear your thoughts.
>
> --
>
> Thank you,
>
>
> Kaitlyn R. Jackson | Attorney| DIMENSION LAW GROUP PLLC
> 130 Andover Park East, Suite 300 | Tukwila, WA 98188
>
> t: *206.973.3500 *| f: *206.577.5090*| e: *kaitlyn at dimensionlaw.com|
> <kaitlyn at dimensionlaw.com%7C>* www.dimensionlaw.com
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> --
>
> Thank you,
>
>
> Kaitlyn R. Jackson | Attorney| DIMENSION LAW GROUP PLLC
> 130 Andover Park East, Suite 300 | Tukwila, WA 98188
>
> t: *206.973.3500 *| f: *206.577.5090*| e: *kaitlyn at dimensionlaw.com|
> <kaitlyn at dimensionlaw.com%7C>* www.dimensionlaw.com
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-- 
Thank you,

Kaitlyn R. Jackson | Attorney| DIMENSION LAW GROUP PLLC
130 Andover Park East, Suite 300 | Tukwila, WA 98188
t: *206.973.3500 *| f: *206.577.5090*| e: *kaitlyn at dimensionlaw.com*|
www.dimensionlaw.com

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the part of this firm’s client(s) or its agents.  IRS CIRCULAR 230 
DISCLAIMER:  To ensure compliance with requirements imposed by the IRS, I 
inform you that any U.S. tax advice contained in this communication 
(including any attachments) is not intended or written to be used, and 
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