Bank of California Nat. Ass'n v. Twin Harbors Lumber Co., 71-1365.
| Decision Date | 25 August 1972 |
| Docket Number | No. 71-1365.,71-1365. |
| Citation | 465 F.2d 489 |
| Parties | BANK OF CALIFORNIA NATIONAL ASSOCIATION, Plaintiff-Appellee, v. TWIN HARBORS LUMBER CO., Defendant-Appellant. |
| Court | U.S. Court of Appeals — Ninth Circuit |
Kevin J. Dunne, (argued), John S. Howell, of Sedgwick, Detert, Moran & Arnold, San Francisco, Cal., for defendant-appellant.
Clayton O. Rost (argued), Palo Alto, Cal., for plaintiff-appellee.
Before MERRILL, KOELSCH and DUNIWAY, Circuit Judges.
We granted permission to appeal in this case under 28 U.S.C. § 1292(b) to decide the following question posed by the District Court in its order made pursuant to that section:
"Whether or not the plaintiffs, separate property owners in a recreational land development, subject to a prior sale of the logging rights, have such a common and undivided interest in each other\'s claims against the present holder of those logging rights so that such claims may be aggregated in order to satisfy the $10,000 jurisdictional requirement of 28 U.S.C. § 1332."
The question posed, however, is not presented in this case. There are no such "plaintiffs"; there is but one plaintiff, appellee Bank of California National Association. It is the trustee of an express trust, under which it holds legal title to a large tract of land in Northern California, known as Deerfield Ranch, for the benefit of three named parties. As to the first two, the Bank holds title as security for the payment to them of certain moneys owing to them, payment to be made from portions of the proceeds of sales of parcels of the property, or, if these be insufficient, from moneys to be paid by the third beneficiary, a partnership. As to the first two beneficiaries, the Bank is, in substance, the trustee with power of sale, under a trust deed type of mortgage.
The third beneficiary, the partnership, has, subject to the rights of the first two beneficiaries, the entire beneficial interest in the property. The Bank holds title for its benefit while the property is being subdivided and sold. When lots are sold, the sale is usually under a contract whereby the Bank retains title until the purchaser pays the price in full, at which point the Bank is to execute and deliver a deed to the purchaser, and the trust terminates as to the parcel conveyed. If the purchaser defaults, his rights are forfeited. Thus the Bank acts as a trustee and as a holder of a security interest for the partnership.
The title to most of the tract is subject to the rights of the defendant appellant Twin Harbors Lumber Co. under a contract whereby it acquired rights to the timber on most of the tract, and to log it. That contract expires at the end of 1974.
After the trust was created, Deerfield Ranch was subdivided into 288 parcels. When this action was filed, most of the parcels had been sold to some 550 purchasers under contracts of the type described above. Twelve parcels had been paid for in full, and those purchasers had received their deeds. Approximately 43 parcels, covering 1,910 acres, had been neither conveyed to nor contracted for by purchasers. The Bank still held legal title to the whole ranch, except for parcels that had been conveyed to buyers. All purchasers' rights are expressly made subject to the rights of Twin Harbors.
The amended complaint pleads three claims, of which we need consider only one. The first and principal claim alleges several bases for recovery. Primarily, it is alleged that before the ranch was damaged by the activities of Twin Harbors, it had a value of $4,500,000, that each of the subdivision parcels had a value in excess of $10,000, and that the unsold parcels had a value of $800,000. It then alleges that Twin Harbors, by numerous unlawful and improper logging practices, has damaged the ranch, as a whole, by more than $2,000,000.
In California, the trustee of an express trust may sue without joining the beneficiaries (Cal.Civ.Code § 368). And the holder of a security interest, such as a mortgagee, whether in possession or not, can sue third parties for damage to the property held as a security. American Savings & Loan Association v. Leeds, 1968, 68 Cal.2d 611, 68 Cal.Rptr. 453, 440 P.2d 933 (Traynor,...
To continue reading
Request your trial
-
Perez v. Wells Fargo Bank, N.A.
...citizenship for diversity purposes. Id. at 7. That case followed American Surety. Id. at 7 n. 1 (citing Bank of California, N.A. v. Twin Harbors Lumber Co., 465 F.2d 489 (9th Cir.1972)(“The Bank, for diversity purposes, is a citizen' of California”)). Next, Plaintiffs contend that Loanstar ......
-
Martinez v. Wells Fargo Bank
...cited American Surety with approval. See U.S. Nat'l Bank v. Hill, 434 F.2d 1019, 1020 (9th Cir.1970); Bank of Cal. Nat'l Ass'n v. Twin Harbors Lumber Co., 465 F.2d 489, 492 (9th Cir.1972). Wells Fargo advances several arguments for avoiding American Surety's holding that principal place of ......
-
Perez v. Wells Fargo Bank, N.A.
...citizenship for diversity purposes. Id. at 7. That case followed American Surety. Id. at 7 n.1 (citing Bank of California, N.A. v. Twin Harbors Lumber Co., 465 F.2d 489 (9th Cir. 1972) ("The Bank, for diversity purposes, is a 'citizen' of California")). Next, Plaintiffs contend that Loansta......
-
Taheny v. Wells Fargo Bank, N.A.
...Circuit cases that have cited American Surety as authority on where a national bank is “located.” See Bank of California Nat. Ass'n v. Twin Harbors Lumber Co., 465 F.2d 489 (9th Cir.1972) (“The Bank, for diversity purposes, is a ‘citizen’ of California”), citing28 U.S.C. § 1348 and American......