Barnes v. VNB Mortgage Corp.

This appeal in a declaratory judgment proceeding involves a due-on-sale clause in a deed of trust. Typically, this type of clause provides that the entire balance secured by a deed of trust may be declared immediately due and payable if the property given for security is transferred without the consent of the noteholder.

In a previous case, we considered a due-on-sale clause in the context of a simple real estate transaction wherein property was conveyed subject to a deed of trust, but without the consent of the noteholder. It was contended the noteholder could not invoke the clause in the…