Filed 5/23/17 Arnot Law Firm v. Anderson CA1/3
NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE


ARNOT LAW FIRM, APC,
Plaintiff and Respondent,
v.
GEORGE E. ANDERSON et al.,
Defendants and Appellants.
A149043

(Humboldt County
Super. Ct. No. DR110384)

Plaintiff Arnot Law Firm, APC (Arnot Law) sued defendants George E. Anderson and Jacqueline Anderson for unpaid attorney fees and costs incurred in representing the Andersons. The parties entered into a stipulated judgment of foreclosure and order to sell real property owned by the Andersons in order to satisfy the debt. This appeal is from an order denying the Andersons’ motion to vacate the stipulated judgment of foreclosure.
Arnot Law contends the appeal is moot because the Andersons’ property was sold at a foreclosure sale after a third party lienholder executed upon his own judgment of foreclosure. Because the property that is the subject of the stipulated judgment of foreclosure has already been sold, and because this court cannot afford the Andersons any effective relief, we agree that the appeal is moot and must be dismissed.
FACTUAL AND PROCEDURAL BACKGROUND
In May 2004, Arnot Law agreed to represent the Andersons in order to stop a judgment creditor from selling their residence in Arcata, California (the “Arcata residence”). George Anderson filed a Chapter 7 bankruptcy petition in 2005. In litigation in the United States Bankruptcy Court and Ninth Circuit Court of Appeals that extended over a three-year period, Arnot Law was successful in preventing the judgment creditor and bankruptcy trustee from selling the Arcata residence. In March 2005, the Andersons executed a promissory note in the amount of $4,969.72 in favor of Arnot Law. The note was secured by a deed of trust on the Arcata residence. In September 2009, the Andersons executed an addendum to the 2005 promissory note providing that the note and deed of trust that secured it included all legal fees incurred on the Andersons’ behalf since the date of the 2005 promissory note.
Arnot Law sought payment of its legal fees and costs incurred in representing the Andersons. George Anderson ignored each and every request for payment during the period from 2008 through early 2011. Ultimately, Arnot Law filed a complaint against the Andersons for money judgment and sought to foreclose upon and order a sale of the Arcata residence.
Arnot Law received notification that an attorney had agreed to represent the Andersons in the lawsuit. The state court action was deferred while the matter was referred to an attorney to assess whether the matter was appropriate for arbitration. The attorney declined to refer to the matter to arbitration, concluding that there was no dispute about the amount of fees and costs owed to Arnot Law; the sole dispute was over the timing of the payments. According to Arnot Law, the Andersons never disputed the amount of the debt but simply desired additional time to sell the Arcata residence in order to pay off the fees that were owed.
In June 2012, the Andersons and Arnot Law entered into a stipulation for entry of judgment of foreclosure and order of sale for the Arcata residence. The judgment was for $49,682.96, with interest accruing at 6 percent on and after January 6, 2011. Arnot Law agreed not to conduct a foreclosure sale before April 15, 2013. Arnot Law also agreed to give the Andersons a credit of $5,000 against the debt owed, and further agreed to waive any right to seek a deficiency judgment against the Andersons. The Andersons were represented by an attorney in the negotiations that led up to the signing of the stipulated judgment.
The Andersons filed a Chapter 7 bankruptcy petition in April 2014. In October 2015, they filed a motion in the trial court to set aside and vacate the June 2012 stipulated judgment. They claimed the judgment is void as a result of extrinsic fraud or mistake. Among other things, the Andersons claimed that Arnot Law failed to obtain a signed attorney-client fee agreement, did not advise them to seek an independent legal opinion concerning whether they should grant a security interest in their home, did not inform them of the magnitude of the fees owed, and otherwise violated various rules of professional conduct. In a February 2016 order, the trial court denied the Andersons’ motion to set aside the stipulated judgment, concluding that the grounds offered by the Andersons do not constitute extrinsic fraud or mistake. This appeal is from the order denying the motion to set aside the stipulated judgment.
After this appeal was fully briefed, Arnot Law filed a motion to dismiss the appeal as moot. Arnot Law claims that this court cannot grant any effective relief to the Andersons because the Arcata residence was sold at a foreclosure sale in March 2017.
The facts bearing upon the motion to dismiss are as follows. Before the property’s sale in March 2017, the Arcata residence was encumbered by three deeds of trust. A first deed of trust was in favor of Tom Abrahamson in an amount exceeding $100,000. A second deed of trust was in favor of Arnot Law in the amount of $49,696.96, plus accrued interest, fees, and costs. A third deed of trust was in favor of Mark Munkittrick in the amount of $364,679.63. Munkittrick is identified as the trustee of the Andersons’ irrevocable trust.
The holder of the third deed of trust, Munkittrick, secured a judgment of foreclosure and order of sale for the Arcata residence in May 2015. Munkittrick executed upon the judgment and the Arcata residence was sold at a foreclosure sale in March 2017. Munkittrick purchased the Arcata residence for $200,000 as a credit bid against his $364,679.63 judgment of foreclosure. The foreclosure sale satisfied the debt owed by the Andersons to Munkittrick and extinguished the third deed of trust. (See Kolodge v. Boyd (2001) 88 Cal.App.4th 349, 356.) The record before us does not disclose the status of Arnot Law’s second deed of trust following the sale. As the junior lienholder and successful purchaser, Munkittrick would ordinarily take the property subject to any senior liens, including Arnot Law’s deed of trust. (See ibid.)
DISCUSSION
It is not the function of an appellate court to render an opinion upon moot questions or abstract principles of law, or to declare rules of law that can have no effect on the matter before the court. (People v. Rish (2008) 163 Cal.App.4th 1370, 1380.) “[A] case becomes moot when a court ruling can have no practical effect or cannot provide the parties with effective relief.” (Lincoln Place Tenants Assn. v. City of Los Angeles (2007) 155 Cal.App.4th 425, 454.) “ ‘[A]n action that originally was based upon a judiciable controversy cannot be maintained on appeal if all the questions have become moot by subsequent acts or events. A reversal in such a case would be without practical effect, and the appeal will therefore be dismissed.’ ” (People v. Herrera (2006) 136 Cal.App.4th 1191, 1198.)
Arnot Law contends the appeal is moot because the Andersons no longer have an interest in the Arcata residence. We agree. The reason the Andersons sought to vacate the stipulated judgment was to prevent Arnot Law from selling the Arcata residence in a foreclosure sale. The event they sought to forestall has now happened. The sale of the Arcata residence was authorized by a judgment of foreclosure separate and distinct from the stipulated judgment of foreclosure the Andersons seek to reverse on appeal. A reversal of the stipulated judgment of foreclosure involving Arnot Law would have no practical effect because the property has already been sold.
The Andersons contend the sale of the property does not render the appeal moot. They claim they are entitled to recover as restitution the fair market value of any property subjected to execution. But this argument is premised upon the notion that the foreclosure was wrongful. Here, however, the foreclosure was not based upon the stipulated judgment the Andersons claim is void. Instead, it was based upon a separate judgment of foreclosure involving a different judgment creditor, Munkittrick. Thus, even if we were to reverse the stipulated judgment, it would have no bearing upon whether the foreclosure pursued by Munkittrick was wrongful.
Further, our reversal of the stipulated judgment would not alter the fact that Arnot Law has a lien on the Arcata residence. The deed of trust in favor of Arnot Law predates the stipulated judgment of foreclosure and would still exist even if we reversed the stipulated judgment. Even assuming we could somehow expunge Arnot Law’s second deed of trust in this appeal, there is still nothing to suggest that the Andersons would receive any benefit as a consequence. They are not entitled to any surplus funds from the foreclosure sale instituted by Munkittrick. Under the terms of Munkitrick’s judgment of foreclosure, any surplus funds from a foreclosure sale were to be paid to the bankruptcy trustee in the Andersons’ Chapter 7 bankruptcy. In short, there is no remedy we could fashion on appeal that would provide the Andersons any effective relief.
We may exercise our discretion to entertain an otherwise moot appeal if it raises an issue of continuing public importance that is capable of repetition while evading review. (In re Anna S. (2010) 180 Cal.App.4th 1489, 1498.) This principle is an exception to the general rule mandating dismissal of an appeal that has been rendered moot by subsequent acts or events. (In re Christina A. (2001) 91 Cal.App.4th 1153, 1158.) The exception is inapplicable here. Although the Andersons assert the appeal “involves issues that are far too important to be simply dismissed as moot,” they fail to explain why these issues will continue to evade review if we decline to consider them now. Under the circumstances, we decline to exercise our discretion to entertain this moot appeal.
DISPOSITION
The appeal is dismissed. The parties shall bear their own costs on appeal.



_________________________
McGuiness, P.J.


We concur:


_________________________
Pollak, J.


_________________________
Jenkins, J.