## Facts

- Sellers entered a written land-sale contract with buyers for real property in Pasadena, California.
- The contract required monthly installment payments toward the purchase price, with conveyance of title deferred until specified principal payments were made.
- Buyers took possession, then stopped making payments and abandoned the property.
- Sellers sued for accrued, past-due monthly installments through the time of trial, rather than pursuing forfeiture, foreclosure, or other remedies against the property.
- The case was tried on stipulated facts; the trial court entered judgment for sellers for $13,800, concluding Code of Civil Procedure § 580b did not bar recovery.
- Buyers appealed, asserting § 580b barred the action as an impermissible deficiency recovery on a purchase-money obligation.

## Issues

1. Whether a seller’s suit for past-due installments under a land-sale contract is, in substance, a “deficiency judgment” barred by California Code of Civil Procedure § 580b.
2. Whether § 580b applies to a land-sale contract that defers conveyance and treats the seller’s retained title as purchase-money security, even without a prior foreclosure or sale.

## Decision

- The Court of Appeal reversed the judgment for the sellers.
- Section 580b applied to the land-sale contract because it functioned as purchase-money security.
- A personal judgment for unpaid installments, while the seller retained title as security, was treated as the equivalent of a barred deficiency recovery.
- Sellers’ recourse for the unpaid purchase-money obligation was limited to the property/security, not a personal money judgment against the buyers.

## Legal Principles

- Land-sale contracts that defer conveyance while taking installment payments can operate as purchase-money security; the seller’s retained title is treated as a security interest for the price.
- Code of Civil Procedure § 580b bars personal liability for deficiencies on purchase-money security, including contracts of sale brought within the statute’s scope.
- Courts evaluate substance over form: an action labeled as one for “installments” may be barred if it effectively imposes personal liability for purchase-money debt while the seller retains security.
- Section 580b’s protection applies even absent a foreclosure or execution sale when the vendor’s claim would otherwise circumvent the statute’s anti-deficiency policy.

## Conclusion

The appellate court held that § 580b barred the sellers from recovering unpaid installments as a personal judgment under a land-sale contract functioning as purchase-money security, limiting the sellers to remedies against the property rather than the buyers personally.


Venable v. Harmon, 233 Cal. App. 2d 297 (Cal. Ct. App. 1965)