MARTINEZ -- The Contra Costa County Superior Court is booting auctions of foreclosed homes from the steps of its Wakefield-Taylor courthouse in downtown Martinez.
Such auctions have been taking place there for decades, but the court says the growing number of participants in the wake of an improving economy is interfering with court business, prompting a judicial order last week to send the auctions elsewhere. Notices are being distributed announcing that any commercial activity outside the court is prohibited starting Feb. 15.
Foreclosed home auctions have been held outside county courthouses in California dating back to the Great Depression and the establishment of foreclosure laws, said Sean O'Toole, founder and CEO of PropertyRadar, a real estate tracking service. As the state limits the amount a lender and trustee can charge to hold an auction, courthouses were adopted as a free and publicly accessible venue.
Now courts in several counties are kicking the auctions off their property, as there is no legal mandate to have them there. Contra Costa County follows Los Angeles, Sonoma, Nevada and San Bernardino counties.
In Martinez, people attending auctions have inadvertently blocked others from entering the courthouse, and officials are worried about liability issues, said court spokeswoman Mimi Zemmelman.
Moving the auctions away from courthouses causes confusion for trustees and buyers, said O'Toole. Trustee sales can be delayed for as long as a year, so there will be planned sales for the courthouse steps dated beyond the court's three-month grace period.
"If trustees start holding their sales in different locations, that would be a worst-case scenario for buyers," O'Toole said. "You can't be in two places at once."
Ken McCormick, real estate crimes prosecutor at the Contra Costa District Attorney's Office, said holding the auctions at private locations could present opportunities for fraud, particularly bid-rigging.
Contact Malaika Fraley at 925-234-1684. Follow her at Twitter.com/malaikafraley.