New Tech Developments v. Bank of Nova Scotia

• Decision Date: 08 May 1987
• Citation: 236 Cal.Rptr. 746,191 Cal.App.3d 1065
• Court: California Court of Appeals Court of Appeals
• Parties: , 4 UCC Rep.Serv.2d 201 NEW TECH DEVELOPMENTS, DIVISION OF SAN DIEGO CARLETON LEWIS CORPORATION, a California corporation, and California Digital, Inc., a California corporation, Plaintiffs and Appellants, v. BYNAMICS, INC., an Ontario corporation, doing business in California, Bank of Nova Scotia, a Canadian chartered bank, Union Bank, a national banking association, and Does 1 through 25, inclusive, Defendants and Respondents. B016390.

Page 746

236 Cal.Rptr. 746

191 Cal.App.3d 1065, 4 UCC Rep.Serv.2d 201

NEW TECH DEVELOPMENTS, DIVISION OF SAN DIEGO CARLETON LEWIS CORPORATION, a California corporation, and California Digital, Inc., a California corporation, Plaintiffs and Appellants, v. BYNAMICS, INC., an Ontario corporation, doing business in California, Bank of Nova Scotia, a Canadian chartered bank, Union Bank, a national banking association, and Does 1 through 25, inclusive, Defendants and Respondents.

B016390.

Court of Appeal, Second District, Division 7, California.

May 8, 1987.

As Modified on Denial of Rehearing June 8, 1987.

Review Denied July 29, 1987.

James Toledano, Irvine, for plaintiffs and appellants

Musick, Peeler & Garrett and Bruce A. Bevan, Jr., Los Angeles, for defendants and respondents.

JOHNSON, Associate Justice.

Appellants New Tech Developments and California Digital, Inc. (New Tech) appeal the dissolution of a preliminary injunction granted by the trial court even though the previously enjoined act has now been completed. The sole question raised on appeal is whether it is within the jurisdiction of one superior court judge to dissolve an injunction issued by another superior court judge under section 533 of the Code of Civil Procedure when no evidence of new facts or changed circumstances is presented to the second judge. New Tech asks us to reverse the order dissolving the preliminary injunction, reinstate that injunction and order respondent Bank of Nova Scotia to return $267,695 to Union Bank. We decline appellants' invitation to put Humpty-Dumpty back together again and affirm the order.

STATEMENT OF FACTS AND PROCEEDINGS BELOW

Plaintiffs filed a complaint against Bynamics, Inc., an Ontario corporation (Bynamics), Bank of Nova Scotia and Union Bank for breach of contract, fraud, declaratory relief, rescission and injunction. This action arose from the following facts. Plaintiffs contracted to buy certain goods from Bynamics. Pursuant to an agreement, they applied for an irrevocable letter of credit drawn on Union Bank to provide for payment up to $292,195 to Bynamics, payable through Bank of Nova Scotia, on the account of California Digital, Inc. after presentation of sight drafts 90 days after date of shipment and receipt of appropriate documentation of the shipment.

Union Bank issued the letter of credit which was to be paid 90 days after shipment. Upon receipt of the goods plaintiffs advised Union Bank of their acceptance and authorized Union Bank to communicate this to Bank of Nova Scotia. At Bynamics' request Bank of Nova Scotia sent drafts drawn under the letter of credit to Union Bank. Union Bank accepted the drafts and returned them to Bank of Nova Scotia. Subsequently Bank of Nova Scotia purchased these drafts from Bynamics. Thus, Bynamics was paid for the underlying transaction.

Some time later plaintiffs determined the goods were unsatisfactory and that Bynamics was going out of business. Plaintiffs filed suit, sought and were granted a temporary restraining order to stop payment on the letter of credit on June 3, 1985, the day before payment on the drafts became due. On June 18, 1985, Judge Pro Tempore Hyman O. Danoff issued a preliminary injunction. On July 16, 1985, Bank of Nova Scotia moved to dissolve the preliminary injunction (Code Civ.Proc., § 533) claiming there was insufficient ground for its issuance. The matter was heard before Judge Robert N. Mallano who dissolved the preliminary injunction. The next day on July 17, Union Bank made payment on the drafts to Bank of Nova Scotia. New Tech timely appealed. ¹

I. UNDER THE FACTS OF THIS CASE JUDGE MALLANO HAD JURISDICTION TO HEAR THE MOTION TO DISSOLVE

Bank of Nova Scotia's motion for dissolution of the preliminary injunction pursuant to section 533 (Code Civ.Proc.) ² was granted by Judge Mallano in a subsequent proceeding. New Tech contends the motion was improperly brought before Judge Mallano. We conclude under the facts of this case Judge Mallano had jurisdiction to hear the motion.

The matter was assigned to Hyman O. Danoff, a retired commissioner, who was sitting as judge pro tempore. The general rule is once a matter has been assigned to one department of the superior court for hearing and determination, and there has been no final disposition, "it is beyond the jurisdictional authority of another department of the same court to interfere with the exercise of the power of the department to which the proceeding has been so assigned." (Williams v. Superior Court (1939) 14 Cal.2d 656, 662, 96 P.2d 334.) The policy basis for such a rule is clear. It prevents the certain confusion generated by "conflicting adjudications of the same subject-matter by different departments of the one court" (ibid.) and invidious forum-shopping within the superior court.

"The appointment of a temporary judge to hear a particular 'cause' carries with it the power to act until the final determination of that proceeding." (Sarracino v. Superior Court (1974) 13 Cal.3d 1, 10, 118 Cal.Rptr. 21, 529 P.2d 53 [italics in original].) This means the judge pro tempore has the authority to hear the matter if the parties so stipulated (Cal. Const., art. VI, § 21, Anderson v. Bledsoe (1934) 139 Cal.App. 650, 651, 34 P.2d 760.), ³ but it does not mean that only the judge pro tempore is empowered to rule on the matter. Although the record does not reveal details of Commissioner Danoff's tenure as a judge pro tempore, it does indicate he was unavailable to preside over the subsequent hearing. The record at the hearing on the motion to dissolve contains the following:

"MR. TOLEDANO:

"...The motion provides no change of facts and no changed law, and that I think is conceded. In fact, what this really is is a motion for reconsideration. This court is being asked to reconsider what Commissioner Danoff did.

"THE COURT: He is not here.

"MR. TOLEDANO: Exactly. Under 1008--

"THE COURT: He sat for a couple of weeks for vacation leave."

This case is distinguishable from Ford v. Superior Court (1986) 188 Cal.App.3d 737, 233 Cal.Rptr. 607. In Ford a judgment was entered against plaintiffs. (Id., at p. 740, 233 Cal.Rptr. 607.) They subsequently sought a preliminary injunction from a second judge in a different department to restrain the superior court and clerk of the superior court from executing the judgment. (Id., at p. 741, 233 Cal.Rptr. 607.) That judge denied their application without In the instant case Commissioner Danoff was unavailable. Although he would have had authority to hear the motion had he been available, his unavailability did not preclude Bank of Nova Scotia from moving to dissolve the injunction or Judge Mallano from ruling on the motion. A judge pro tempore may have authority to hear a matter until its final determination but this power does not, as in this case, prohibit a party from seeking equitable relief when that temporary judge is unavailable.

prejudice to allow them to apply to the issuing judge. (Ibid.) Plaintiffs then filed again in another department. The third judge dismissed the matter noting it had no jurisdiction. (Ibid.) On appeal the court affirmed the order of dismissal for lack of jurisdiction over the subject matter following the rule one department of the superior court cannot enjoin, restrain, or interfere with the judicial act of another department. (Id., at p. 742, 233 Cal.Rptr. 607.)

Similarly In re Kowalski (1971) 21 Cal.App.3d 67, 98 Cal.Rptr. 444 does not apply to this case. In Kowalski two available judges made inconsistent rulings in a single case. Defendant's motion to set aside his indictment (Pen.Code, § 995) was denied by one judge. (Id., at p. 69, 98 Cal.Rptr. 444.) Defendant went to trial before a second judge who granted his motion for a mistrial and invited defendant's renewal of his 995 motion. That judge then granted defendant's motion for dismissal. (Ibid.) Subsequently defendant came before the first judge who ordered a new trial date and fixed bail on the basis the second judge acted in excess of his jurisdiction. (Id., at pp. 69-70, 98 Cal.Rptr. 444.) The court of appeal granted defendant's petition for habeas corpus on the basis orders made after a dismissal are void even though the second judge had abused his discretion when considering matters already ruled upon by the first judge. (Id., at pp. 70-71, 98 Cal.Rptr. 444.) (See also People v. Locklar (1978) 84 Cal.App.3d 224, 230, 148 Cal.Rptr. 322 [second judge's granting of motion to consolidate was not jurisdictional error].) If Commissioner Danoff had been available the matter should have appropriately been reheard before him. Such was not the case.

II. THE TRIAL COURT DID NOT ABUSE ITS DISCRETION IN DISSOLVING THE PRELIMINARY INJUNCTION

New Tech contends this injunction should not have been dissolved--even by the judge who issued it--because it had been granted with notice to the parties and Bank of Nova Scotia did not show a change in facts or law or the ends of justice would be served by its dissolution. In sum, New Tech's position is an injunction cannot be dissolved unless it was granted without notice citing as authority Ots v. Superior Court (1909) 10 Cal.App. 168, 101 P. 431. New Tech argues the power to modify or vacate an injunction is limited to "(a) motions made before the judge who granted the injunction, (b) where there is a change of circumstances or a change in the law, (c) in order better to preserve the equities and the ends of justice." New Tech also inconsistently claims: "Only if the circumstances of the second order is supported by evidence or compliance with all of the necessary conditions outlined in the cases did the second judge have any authority to act as he did.".

It is true, as New Tech concedes, section 532, subdivision (a) (Code Civ.Proc.) ⁴ expressly allows a person enjoined without notice to apply to the judge who granted the motion or to the court to dissolve or modify the injunction. However, this does not...