Wednesday, May 29, 2013

Adir Int'l v. Superior Court (May 29, 2013)

Here's a case that I would have decided the other way.

Debtor loses a $90,000 judgment at trial, so creditor is entitled to execute on the judgment.  It does so, and the sheriff levies some of debtor's property.  But disbursement to the creditor isn't scheduled until later, and debtor still has plenty of time to file a notice of appeal, post a bond and thus quash the judgment lien.  Which it does.  Notifying the sheriff to boot.

At which point the sheriff isn't supposed to transfer the debtor's levied property to the creditor.  But the sheriff mistakenly does so.   Oops.

The debtor accordingly files a motion in the trial court to require the debtor to give back the ill-gotten booty (i.e., the levied funds).  The trial court denies the debtor's motion, saying that there's no statute that seems to affirmatively allow such a request, although there's no statute that precludes such relief either.  The Court of Appeal affirms, for essentially the same reason.

For me, there's such a thing as equity.  There's a principal that for every wrong there's a remedy.  That would be enough for me.  There was a wrong here; the debtor lost some property to which it's entitled and the creditor has been unjustly enriched.  We should change that.  There's no reason at all -- none -- why the creditor should be allowed to hold onto property it should never have received in the first place, particularly since its interest is fully protected by the existing appeal bond.

It matters not to me that the debtor could have potentially filed a different motion that might have gotten its property back in a different way.  It did what it was supposed to do.  It was entitled to get its property back.  That it could have done two things to have gotten the property doesn't negate the fact that the first thing that it did should have worked.

It'd be one thing if there was a statute that affirmatively barred the relief the debtor seeks.  There's not.  I think a writ ordering the creditor to do what it should -- quite frankly -- voluntarily do anyway is entirely appropriate.

Notwithstanding the contrary (though, I concede, understandable) holding of the Court of Appeal.