David J. Cook, Esq, has been practicing from December, 1974 and continuing in the enforcement of judgment, collections, bankruptcy, insolvency, civil litigation, transactions and related matters. COOK LEGAL SERVICES are and describe these services and more of David J. Cook, Esq.

On Appeal: Admitted Surety Bonds, Cash Deposits And Personal Surety Bonds

By David J. Cook

2021 March

Seeking to topple the adverse judgment and immunity from enforcement, the defendant perfects the appeal by filing the notice of appeal and posting a bond. C.C.P. section 917.1(b) requires a bond in twice the amount of the judgment, unless an admitted surety issues the bond. If a bond is issued from an admitted surety, the bond is 1.5 times the face amount of the judgment (§§ 995.610 to 995.675).  Alternately, the defendant can execute a deposit in lieu of a bond (§§ 995.710 to 995.770) or offer a third-party personal surety (§§ 995.510 to 995.520).

View the complete article here…

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Arbitration and attachments

By David J. Cook

2021 February

Arbitration offers litigants finality, some level of confidentiality, efficiency, expertise of the arbitrator, and better management of the proceeding. But, does arbitration offer prejudgment remedies that would lien the assets of the respondent to protect against an “empty award” or the empty judgment when the award is confirmed?

View the complete article here…

Hidden interest and hidden gems

By David J. Cook

2021 January

Looking for the secrets of pre- and post-judgment interest? All you need is a $26.99 printing calculator. We start with Code of Civil Procedure section 685.010, subdivision (a), which sets the rate of interest for judgments at 10% per annum and section 685.020, subdivision (a), which commences 10% interest on the date of entry of the judgment. This article offers the curlicues of compounding interest, interest in excess of usury, and hidden interest.

View the complete article here…

Vacating or preserving stale judgments bearing inherent defects: setting aside the final judgment

By David J. Cook

The Free Press – Volume 10, Summer 2011

Published by the Commercial Law League of America

The crucible of every judgment is enforcement, compelling the judgment debtor to involuntarily compensate the plaintiff. Absent insurance or a solvent defendant, judgments do not reach a flash point until the debtor sells valuable property encumbered by a judgment lien, or confronted by aggressive and successful campaign of civil enforcement.

View the complete article here…

Post judgment subpoena power: Creditors need not fly blind into the quagmire of enforcement.

This ruling demonstrates that a judgment creditor is generally entitled to use the power of a subpoena to marshal financial records at a debtors exam. This is important in enabling the judgment creditor to meaningfully examine the judgment debtor with bank statements, and financial statements at hand.

Read the full opinion here.

Arbitration: An iron clad, albeit not infallible form of dispute resolution.

Arbitration benefits litigants by offering finality. As the California Court of Appeal held in Sappal v. Business Investment Management,  absent the most extreme ruling, an arbitrators decision is not subject to judicial review.

Why is this important? Winners like arbitration as they offer finality, assuming they got what they wanted. Losers abhor arbitration, as they offer finality, assuming that they are disappointed with the result.

Read the full opinion here.

 

Fraudulent Conduct and Jurisdiction

In Kraus-Anderson Capital v. Alamo Medical Supply & Equipment, Inc. the California Court of Appeal (2nd Dist.) upheld a trial court’s finding that the Minnesota Courts had the jurisdiction to enforce a promisory note executed in California.

The facts here are typical of many finance transactions. An out of state financier lends money to a customer of expensive, specialized equipment. The customer executes a promisory note and security agreement. The vendor executes a remarketing agrement obligating the vendor to recover the collateral and provide for remarketing, a common mechanism facilitating the sale of specialized equipment.

The customer in this case defaulted, and the financier sought to recover its collateral and call upon the vendor to re-market the equipment. The financier then discovered that the equipment was misrepresented and that the vendor defaulted on the remarketing agreement. The financier obtained a judgment in its home state (Minn.) against the vendor for the fraudulent equipment and the breach of the remarketing agreement. The financier then sought to domesticate the sister-state judgment in California, prompting the vendor to challenge the judgment on jurisdictional grounds. The California trial court denied the motion and the Court of Appeal affirmed.

In a scholarly analysis the appellate court found that the sister-state court properly had jurisdiction over the vendor.

The message from this case is that a financier is entitled to seek relief in its home court given a breach of a remarketing agreement by an out of state vendor.

Read the full opinion here.

The Discretionary Stay Against Enforcement of a Judgment

Los Angeles Lawyer – April 2011

By David J. Cook

THE RACE TO ENFORCEMENT begins as soon as a judgment creditor wins a lawsuit. While typically the plaintiff, a judgment creditor can also be the defendant in an anti-SLAPP suit. In either situation, the judgment creditor can begin enforcement procedures immediately upon entry of judgment and can go so far as to direct the sheriff to appear at the defendant’s front door, break it down, and seize the contents from ?oor to ceiling, including the family dog. Only settlement, posting of an expensive appeal bond, or entry of a discretionary stay of enforcement by the trial court can prevent enforcement…

Continue reading the full article here.

Bankruptcy as an Impregnable Shield to Enforcement? Not So Fast.

 

 

 

A quick hypothetical: A debtor isn’t paying. You’ve unleashed your full arsenal of enforcement allowed under the law, bank levies,  a motion for the appointment of a receiver, motion for sale of a dwelling house, etc. The whole gamut.

Everything is going along well enough, until your fax machine coughs out a friendly notice from your local bankruptcy court that your debtor filed Chapter 13.

That’s funny, you were sure that your debtor had deep pockets. Bankruptcy? This debtor could write you a check tomorrow if he weren’t still bitter that you had the sheriff sell his Lamborghini. No, this time it’s personal. Your debtor just doesn’t want to pay.

Your debtor then sets forth a plan which purports to pay his creditors (You) 100 cents on the dollar, but in monthly payments spread out over 5 years and with no interest.  This doesn’t sound appealing at all.

The court in the case of  In re Steven Allan Korn (CAEB, Case No: 11-91339) rejected precisely such a plan, finding that when bankruptcy is filed for the sole purpose of frustrating the enforcement attempts of a single creditor the filing was in bad faith.

Read the full opinion here.

Checks and Wire Transfers to Counsel are not Privileged: Discovery Reveals Clients’ Accounts.

In the case of Garza v. ACL the judgment creditors sought to obtain a corporate debtor's financial records through a subpoena targeted at the debtor's attorneys.  In answering the question of  "Are canceled checks  protected by attorney client privilege?" the court, Hon. John K. Stewart, Judge Presiding, answered with a resounding No.

“THE COURT: I think the difference is that a check or a money transfer, these have lives of their own. They are not communications. They are instruments of commerce. They are negotiable instruments. A letter accompanying a check would be a communication, but a check is really a communication to a bank. It’s telling the bank to pay a certain amount of money on behalf of a client. So I think the Harris analysis, to me, is the most appropriate and on point. And that’s the Ninth Circuit Court of California — Ninth Circuit Court in California. It’s 413 F.2d 316. But they say, and they are quoting another case, but they say “The canceled checks and bank statements are not within the attorney-client privilege. These items were negotiable instruments in commerce and were never confidential from the time of their creation.Their transfer from the client to the attorney did not constitute a confidential communication.”In those cases, they were trying to subpoena those records from a bank.And again, if those documents ultimately end up in a bank, and they do, when the check comes into your firm, you endorse it, and it goes back to the bank. The original sometimes is referred to the person who signed the check. Now, for example, my own bank account, I get little microfiche reprints and the originals are either in my bank or else they are kept on microfiche somewhere. But they are ultimately in the bank.”

(See attached transcript, Pg. 13)

Read the full transcript here.

A Blast From the Past

Circa 1985

The 1980’s was a good decade for a lot of things:  new wave music, cheesy movies, nuclear proliferation, and apparently hair.

California Court of Appeal Affirms: No Attorney Fees in Anti-SLAPP Cases Where Law Firm is Represented by an Associate

CARPENTER & ZUCKERMAN et al., v. PAUL COHEN et al.,

Court of Appeals of California, Second District, Division Five.

Filed May 10, 2011.

         The trial court in granting defendants’ request to strike plaintiffs’ memorandum of costs seeking attorney fees incurred as the prevailing parties in a prior appeal, a law firm and its two partners, by using an associate in the law firm, had, in effect, represented themselves in the prior appeal. In this appeal, plaintiffs contend that the trial court erred in granting the motion to tax costs because the attorney who represented them on appeal was not a partner and otherwise had no financial interest in their law firm. Also, plaintiffs contend that, even if the law firm plaintiff cannot recover fees for the legal services of the associate, the individual plaintiffs can recover fees attributable to that associate’s services rendered on their behalf.

        In affirming the order denying plaintiffs’ request for attorney fees for services rendered by the associate to the firm and its partners, we hold that (1) substantial evidence supports the trial court’s finding that the attorney who represented plaintiffs in the prior appeal was doing so as an associate of the law firm and not as an independent contractor, and, therefore, plaintiffs legally are not entitled to an award of attorney fees; and (2) the trial court was justified in concluding that based on the record, the individual plaintiffs could not recover attorney fees in connection with the appeal because there was no showing of any distinction between the cross-claims against the law firm plaintiff and those against the individual plaintiffs.

Read the full opinion here.

Foreign Manufacturers are Offshore But Not Out of Reach

Pratt’s Journal of Bankruptcy Law May/June 2011

By David J. Cook

This article discusses post judgment strategies to reach the assets of uncooperative, distant, or reclusive judgment debtors.

Read the full article here.

Disentitlement of the Debtor from Judicial Proceedings Defiant to the End

Debt3 March/April 2011

By David Cook

Ray Charles taught us disentitlement: “Hit the road, Jack, and don’t you come back no more, no more, no more, no more.” Disentitlement offers the nuclear remedy to compel payment, if possible, from the recalcitrant debtor — and, like “Jack” in Ray Charles’ wonderful song, hits the road. This article is a primer on civil disentitlement.

Read the full article here.

The Discretionary Stay Against Enforcement of a Judgment

Los Angeles Lawyer, April 2011
by David J. Cook

The race to enforcement begins as soon as a judgment creditor wins a lawsuit. While typically the plaintiff, a judgment creditor can also be the defendant in an anti-SLAPP suit. In either situation, the judgment creditor can begin enforcement procedures immediately upon entry of judgment and can go so far as to direct the sheriff to appear at the defendant’s front door, break it down, and seize the contents from floor to ceiling, including the family dog. Only settlement, posting of an expensive appeal bond, or entry of a discretionary stay of enforcement by the trial court can prevent enforcement.
Continue reading the full article here.

OFFSHORE IS NOT OUT OF TOUCH

Originally published in Debt3, Vol. 26, Issue No. 1, January/February 2011

Knock-off, counterfeit items, forgeries and fakes can be found everywhere from New York City alleyways to online stores. How can the law help manufacturers fight back?

View the article here.

Intervention by the Peterson Plaintiffs in Rubin v. Iran

The Rubin family levied upon the antiquities collection owned by Iran in the hands of the Oriental institute of the University of Chicago.  The Peterson plaintiffs survivors and family members of the marine barracks bombing successfully intervened.  As of February 2011, the seventh circuit is considering jurisdictional challenges.

View the minute order here

Seeking a Homestead Exemption? Do Not Fraudulently Convey Your Home.

Prior to the filing of his bankruptcy, the debtor conveyed his residence to his parents. This conveyance apparently constituted a fraudulent conveyance. The debtor claimed the property as exempt in order to protect some of the equity. Bankruptcy Code Sec. 522(g) bars a debtor from exempting property which was fraudulently conveyed.  This case is important in illustrating the dire risks of any type of asset protection strategy.

View the order here

District Court Order Authorizing Process Server to Serve Post-Judgment Process

Enforcement of judgments in federal court compels the judgment creditor to take many steps in order to engage the marshal or a process server. Many marshals decline service of a garnishment and instruct the judgment creditor to use a process server. The practice in most districts is that the judgment creditor must obtain an order from the district court authorizing the process server to serve the enforcement.  This is a requirement in several districts of California.

View the order here

Road Map Through Fraud: Stops, Back Roads, Turnouts and Detours

Originally published in Commercial Law Bulletin November/December 1995

Dealing with fraudulent conveyances can be frustrating to say the least. This article demystifies the most common debtor strategies and provides a road map to recovery.

Read the Full Article Here