California Codes, Civil Code - CIV, Division 3 — Obligations, Part 4 — Obligations Arising from Particular Transactions, Title 14 — Lien, Chapter 2c — Real Property Sales Contracts, Section 2985.4
Every seller of improved or unimproved real property under a real property sales contract who receives pro rata payments for insurance and taxes shall hold these amounts in trust for the purpose designated. These amounts shall not be disbursed for any other purpose without the consent of the payor and any person or corporation holding an encumbrance on the property.
This section shall not apply to a state- or federal-supervised assignee of a seller who as agent for the seller receives and disburses payments.
Notes
Requires a seller under a real-property sales contract who receives prorated insurance and tax payments to hold those amounts in trust for their designated purposes and bars other use without consent from the payor and encumbrance holders. Exempts a state- or federally supervised assignee acting as the seller’s agent to receive and disburse those payments.
Use as reference
Lexinter.net | California Code, Civil Code - CIV § 2985.4 | https://laws.lexinter.net/codes/california/civil-code/division-3/part-4/title-14/chapter-2c/section-2985-4