Oksner v. Superior Court In and For Los Angeles County

• Decision Date: 15 September 1964
• Citation: 40 Cal.Rptr. 621,229 Cal.App.2d 672
• Court: California Court of Appeals Court of Appeals
• Parties: Chester M. OKSNER and Atlantic Savings and Loan Association, Petitioners, v. The SUPERIOR COURT of the State of California IN AND FOR the COUNTY OF LOS ANGELES, Respondent, and John R. THERIOT, Real Party in Interest. Civ. 28501.

Page 621

40 Cal.Rptr. 621

229 Cal.App.2d 672

Chester M. OKSNER and Atlantic Savings and Loan Association, Petitioners, v. The SUPERIOR COURT of the State of California IN AND FOR the COUNTY OF LOS ANGELES, Respondent and John R. THERIOT, Real Party in Interest.

Civ. 28501.

District Court of Appeal, Second District, Division 2, California.

Sept. 15, 1964.

Grant B. Cooper and Richard M. Moore, Los Angeles, for petitioner Oksner.

Fitzpatrick & Wiley, Los Angeles, for petitioner Atlantic Savings & Loan Ass'n.

Robert A. Neeb, Jr., Beverly Hills, Brinton N. Bowles, Montrose, Von Herzen & Hutton, Los Angeles, formerly Von Herzen & Laidig, Los Angeles, by Peter F. Burum, Beverly Hills, for real party in interest.

ASHBURN, Justice. ^*

Now before us are writ of review testing the validity of an order adjudging petitioner Oksner guilty of contempt of court and an alternative writ of mandate commanding the Superior Court to vacate certain orders made on June 11, 1964 and June 26, 1964 directing petitioner Atlantic Savings and Loan Association (hereinafter called Atlantic) and petitioner Oksner to surrender to the clerk of the court a certain valuable note and deed of trust held by Atlantic as pledgee, and also directing the lower court to vacate certain other related orders made on the same day.

This proceeding centers upon and revolves around the occurrences of June 26, 1964. The background is tedious but most of it essential to understanding of the problems before us.

Prior to said June 26, 1964 there were three actions pending in Los Angeles Superior Court which are designated by petitioners' counsel as Theriot 1, Theriot 2, and Theriot 3, respectively, each being entitled 'John R. Theriot, Plaintiff, v. Milton H. Durand, et al., Defendants,' numbered respectively 669675, 838617, and 840251 on the records of said Superior Court. Theriot 1 (No. 669675) was filed on November 15, 1956 and sought an accounting and damages from Durand based upon a charge of fraud; this resulted in judgment for plaintiff against Durand on January 29, 1964 in the sum of $108,233.78 plus costs. Atlantic has never been a party to that action.

Prior to rendition of that judgment Atlantic made a loan of $600,000 to Durand and others for construction of Brasilia Motel in Pomona, California; the loan was secured by a trust deed on four parcels of real property, viz., Parcel One, the motel site; Parcel Two, Durand's residence; Parcel Three, an apartment house belonging to Durand; and Parcel Four, residence of one Johnson, a partner in the Brasilia venture. The loan was also secured by assignment and pledge of a note for $439,338.07 secured by second trust deed upon property of Sky Villa Motel, a limited partnership, which note and trust deed had belonged to Durand. Prior to August 1963 four additional loans were made by Atlantic to Durand and his associates in the Brasilia venture, aggregating $190,000 in principal amounts and made for the purpose of completion and furnishing of Brasilia Motel; they were secured by the original $600,000 trust deed. Total $790,000. For practical reasons these loans were shifted a bit, resulting in an unpaid balance of principal of $780,000 at the time of filing of petition herein.

On February 27, 1964 garnishment based upon said judgment in Theriot 1 was served on Atlantic which answered that it was not indebted to defendant but did have in its possession and under its control personal property belonging to defendant, adding '* * * to wit: However, the Association is the Assignee of a Note in the original amount of $439,338.07 dated December 22, 1960 secured by Deed of Trust recorded in Book T1602 Page 507 Official Records of Los Angeles County, California, as security for a loan and repayment of a Note, which has an unpaid principal balance of $779,587.49 as of November 5, 1963.'

Then Durand defaulted upon all his trust deed loans and Atlantic noticed a foreclosure sale under the power contained in the trust deeds covering Parcels Two and Three, sale being set for May 15, 1964. On the 14th of May Theriot 2 was filed and served on Atlantic. It sought damages and an injunction against the sale of Parcels Two and Three upon the claim that they had been made in violation of a restraining order issued in Theriot 1 pursuant to stipulation of September 6, 1962. ¹ A temporary restraining order and order to show cause re temporary injunction issued against said contemplated sale of Parcels Two and Three, returnable on May 29, 1964 in Department 54 over which Judge Otto Emme presided at all times pertinent to this proceeding.

On May 21, 1964, more than five days before the scheduled hearing, petitioner Oksner as attorney for Atlantic filed in said Theriot 2 a declaration of disqualification of said Judge under section 170.6, Code of Civil Procedure, and said motion to disqualify was granted, the order to show cause being transferred to Department 15 for hearing on June 10.

Atlantic then elected to sell under power of sale contained in its pledge agreement the Sky Villa note and trust deed, sale set for June 12, 1964, and it served notice thereof upon plaintiff Theriot.

The order to show cause in Theriot 2 came on for hearing in Department 15 on June 10 and the moving party Theriot withdrew his application for a preliminary injunction because, as 'he stated he could not make the required bond, even if the injunction was granted.' The court placed the application off calendar and dissolved the temporary restraining order. Thus Atlantic was brought to June 11, 1964 without any restraint upon its proceeding with its previously noticed sales and with an affirmative showing upon the record that plaintiff Theriot was unable or unwilling to give the customary bond to protect the enjoined party if the sales were thus blocked. However, the bond problem was by-passed on that day through obtaining from the Judge in Theriot 1 an ex parte 'Order of Court in Aid of Execution' directing the sheriff to 'pick up at the office of Atlantic Savings & Loan Association the above described note and deed of trust and return the same to the courtroom of Otto J. Emme, Judge presiding in Department 54 of the Superior Court of the State of California, in and for the County of Los Angeles, and deposit the said documents with the Clerk of the said Court.' The order was served upon Atlantic that same day and the officer was told that the note and trust deed were in possession of its attorneys, one of whom was petitioner Oksner. Whereupon the order was served upon him and he 'believing the ex parte Order was in excess of the Court's jurisdiction, and void, refused to surrender the Note and Trust Deed.' This order had no return date and Mr. Oksner hastily prepared and filed a notice of motion to vacate said ex parte order and a declaration of disqualification of the Judge under section 170.6, Code of Civil Procedure. The petition herein avers 'On the face of the Notice of Motion, Oksner indicated that this was a 'special appearance' by Atlantic, since Atlantic had never been a party to Theriot 1 and had never been served with any papers or pleadings in that action until receipt of the ex parte Order of June 11, 1964.' This motion was filed June 12 and returnable on June 22, 1964.

On June 12 Atlantic was served with summons, complaint and order to show cause for preliminary injunction in Theriot 3, which order contained temporary restraint against pledgee's sale of Sky Villa note and trust deed which was scheduled for that day. The order to show cause was returnable in Department 54 on June 26, 1964. However, there being then no judicial restraint against same, the sales under trust deeds covering Parcels Two and Three proceeded and Atlantic bought the properties for the full amount of the lien on each.

June 26, 1964. Upon the calendar of Department 54 was the order to show cause issued in Theriot 3 which restrained the Sky Villa sale. Oksner had filed on June 12 a declaration of disqualification of Judge Emme under section 170.6 and on June 15 Oksner had orally moved for an order of disqualification which was granted and the order to show cause continued for hearing in Department 65 on June 26. On June 22 Oksner's motion to vacate the ex parte order of June 11 was transferred to Department 1 and continued for hearing to July 20. On June 23 the attorneys for plaintiff Theriot advised Oksner that said motion to vacate had been transferred to Department 54 for hearing by Judge Emme on June 26. This order was made without prior knowledge and without consent of Atlantic or its attorneys.

There was nothing before Department 54 on that day in Theriot 1 or Theriot 2 except the motion to vacate the ex parte order of June 11 in Theriot 1. The three causes had not been consolidated nor had any attempt been made to that end. However, a subpoena duces tecum had been issued in Theriot 3 and served upon Atlantic and Oksner requiring production in Department 54 on June 26 of said Sky Villa note and trust deed. This subpoena, as just noted, was issued in Theriot 3, the action in which the order to show cause was pending and was not issued in Theriot 1, the action to which Atlantic was not and had not been a party.

Upon call of the matter Oksner immediately made an oral motion for disqualification of the Judge based upon the declaration previously filed on June 12; the motion was presented and denied. Oksner argued that the motion was good and any action taken by the Judge would be in excess of jurisdiction and void. Mr. Burum, his opponent, contended that a disqualification could be urged under section 170.6 only by a party and that Atlantic was not a party to Theriot 1. Oskner urged that the only matter before the court was his motion to vacate the ex parte order of June 11 and that Atlantic certainly was a party to that special proceeding and the order was invalid in the first place. Burum insisted that the statute was confined to parties and...