Guam § 2327 - Sales in General: Sales of Encumbered Property; Application

§ 2327. Sales in General: Sales of Encumbered Property; Application

of Purchase Money; Discharge of Encumbrance; Disposal of

Surplus; Purchase by Mortgage or Lien Holder; Procedure;

Expenses.

(a) When any property of an estate is sold which is subject to a

mortgage or other lien which is a valid claim against the estate, and

which has been allowed, the purchase money must be applied, after

paying the necessary expenses of the sale, as follows: first, to the

payment and satisfaction of the mortgage or other lien; and then the

residue, if any, in due course of administration. The application of the

purchase money to the satisfaction of the mortgage or other lien must be

made without delay; and except as provided in subsection (b) of this

Section the property sold is subject to such mortgage or other lien until

the purchase money has actually been so applied.

(b) When any property of an estate is sold which is subject to a

mortgage or other lien which is a valid claim against the estate, the

purchase money, or so much thereof as may be sufficient to pay such

mortgage or lien, may be paid to the Clerk of the Superior Court, where-

upon the mortgage or other lien upon such property shall cease; and the

purchase money shall be paid over by the Clerk of the Superior Court of

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CH. 23 PERSONAL REPRESENTATIVE’S DEALINGS WITH ESTATE PROPERTY

Guam without delay, in payment of the expenses of sale, and in

satisfaction of the obligation to secure which the mortgage or other lien

was taken, and the surplus, if any, at once returned to the personal

representative, unless for good cause shown, and after notice to the

personal representative, the Superior Court otherwise directs.

(c) At any sale of any property of an estate upon which there is a

mortgage or other lien, the holder thereof may become the purchaser,

even though no claim thereon has been, or could have been, presented or

allowed. If no claim thereon has been presented or allowed, the Superior

Court may at the hearing on the confirmation of such sale examine the

validity and enforceability of the lien or charge and the amount due

thereunder and secured thereby, and may authorize the personal

representative to accept his receipt for the amount due thereunder and

secured thereby as payment pro tanto. If such mortgage or other lien is a

valid claim against the estate and has been allowed, the receipt of such

purchaser for the amount due to such purchaser from the proceeds of the

sale is a payment pro tanto. If the amount for which such property is

purchased, whether or not such claim was presented and allowed, is

insufficient to defray the expenses and discharge the purchaser's

mortgage or other lien, the purchaser must pay the Clerk of the Superior

Court an amount sufficient to pay such expenses. Nothing permitted

under the provisions of this subsection shall be deemed to be an

allowance of a claim based upon such mortgage or other lien.