Enjoining a Washington trustee sale – the importance of statutory notice to the trustee

In a Washington deed of trust, the grantor gives the trustee the power of sale over the encumbered property.  If the borrower defaults on the secured obligation, the trustee exercises the power of sale pursuant to, and as authorized by, Washington’s Deed of Trust Act (“DTA”).  A defining feature of the DTA is that the foreclosure process, culminating with the trustee sale, is without judicial oversight.

The DTA does, however, authorize judicial intervention into the sale process.  Under RCW 61.24.130, a party can move the court to restrain the trustee sale for any legal or equitable ground.  RCW 61.24.130(1).  Critical to the court’s ability and jurisdiction to enjoin the sale is proper advance notice to the trustee.  Under RCW 61.24.130(2), the moving party must give the trustee notice at least 5 days before the motion to enjoin sale is to be heard by the court.  This is a jurisdictional requirement imposed in the legislation.  If the trustee does not receive the minimum notice, the court is without jurisdiction to intervene and stop the sale.

The DTA’s notice to trustee requirement is unintuitive because, generally, emergency injunctions can be obtained from a Washington court without advance notice.  During the foreclosure crisis, the DTA’s notice requirement often served as a “trap” for practitioners and pro se homeowners accustomed to the emergency injunction process where an order could be obtained immediately without notice.  An emergency motion to enjoin trustee sale, without the requisite advance notice to trustee, would be summarily dismissed by the court for want of jurisdiction.  If there was no longer sufficient time to give the trustee notice as required by the DTA, the only way to stop the foreclosure, short of payment of the debt, was bankruptcy petition.

When dealing with Washington trustee’s sales, it is important to remember that the legislature authorized the exercise of the power of sale independent of the courts and placed procedural limitations on the courts’ ability to intervene.  In order to “activate” the courts’ jurisdiction to hear the dispute and prevent a transfer of the interest, there must be strict adherence with the procedural requirements.