Procedural Posture

Procedural Posture

Defendants, guarantors and dealerships, appealed from a decision of the Superior Court of Santa Clara County (California), which granted rights of attachment to plaintiff bank based on defendants’ defaults on several flooring and security agreements.

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Overview

Plaintiff bank, alleging breaches of several contracts by defendants, guarantors and dealerships, filed an application for a right to attach order. The trial court granted plaintiff’s application. The court held that plaintiff’s application was sufficiently specific. The trial court stated that defendants had failed to prove that all of the property described in plaintiff’s application was exempt from attachment under Cal. Civ. Proc. Code § 484.090(b). There was no other finding whether or not any of the property was exempt. The court concluded the trial court erred in finding that guarantors failed to prove all the property was exempt because absent opposition from plaintiff, guarantors were not required to prove this claim. The court concluded that plaintiff carried its burden of proving its nonresponsibility and that the trial court was not required to believe defendants’ contrary evidence. Defendants had identified no error in granting rights to attach based on claims previously secured. The court affirmed the orders except as to the property claimed to be exempt by defendant guarantors which the court reversed.

Outcome

The court affirmed the orders granting rights of attachment to plaintiff bank because plaintiff adequately described the property to be attached. However, as to the property claimed exempt by defendant guarantors, the court reversed the orders because the trial court erred in finding that guarantors failed to prove all the property was exempt.