Passow & Sons v. United States Fidelity & Guaranty Co.

In a petition for rehearing, the plaintiff contends that the undertaking sued on is a common-law undertaking, and not an undertaking given pursuant to section 540 of the Code of Civil Procedure. The petition states two grounds for this claim: First, that the language of the undertaking is precisely similar to the undertaking under consideration inSmith v. Fargo, 57 Cal. 157, which was there held to be good as a common-law undertaking; second, that section 540 of the Code of Civil Procedure does not authorize the sheriff to release the property "unless the defendant give him security by the undertaking of at least two sufficient sureties, in an amount sufficient to satisfy such demand, besides costs, or in an amount equal to the value of the property which has been, or is about to be, attached; in which case, to take such undertaking," and that this means that the undertaking must first be delivered personally to the sheriff, and that no undertaking can be considered as given under its provisions where it is passed directly to the plaintiff. *Page 41

The first ground is disposed of by the cases cited in the original opinion herein. While the language of the undertaking in Smith v. Fargo is substantially identical with that of the undertaking in the case at bar, the decision there, holding it good as a common-law undertaking, was not based upon that ground, as will presently be seen.

The second ground was not argued in the briefs. It is true the plaintiff's brief stated that the undertaking was delivered directly to the plaintiff, and that this was an admitted fact in the case, but there is no argument to the effect that the delivery direct to plaintiff had the effect of making it a common-law undertaking rather than one given under the statute. The only argument upon the question was a reference toSmith v. Fargo, supra, followed by the statement that "in that case the court was considering a bond containing the same language as the bond in the case at bar, and held such a bond to be a common-law bond," and by a citation to Kanouse v.Brand, 11 Cal.App. 669, [106 P. 120], and Bailey v. Aetna I.Co., 5 Cal.App. 740, [91 P. 416]. The decision in Smith v.Fargo was not put upon the ground that the undertaking was delivered directly to the plaintiff. The fact was that after the attachment was levied, the defendant appeared in the action and applied to the court for a discharge of the attachment. This he could only do under the provisions of sections 554 and 555, whereby the release could only be obtained by giving an undertaking in a sum to be fixed by the court and for the redelivery of the property or payment of the judgment. Instead of doing this, the defendant gave the undertaking there in question, not for a redelivery, but in the form required for an undertaking under section 540 This court in that case very properly held that the undertaking was not given under section540, because the defendant was not pursuing the remedy there provided, and that it was not good under section 555 because it did not conform to the proceeding there laid down, but that notwithstanding these facts, a recovery thereon could be sustained on the ground that it was a promise supported by a sufficient consideration to pay the debt due to the plaintiff as ascertained and fixed by the judgment, and that it was therefore good as a common-law undertaking or promise. The decision does not hold, and was not intended to hold, that an undertaking given, before the sheriff has returned the writ of attachment, *Page 42 and following the terms required by section 540, is not a good statutory undertaking because of the mere fact that it was delivered directly to the plaintiff instead of being given to the sheriff for the plaintiff. Kanouse v. Brand, supra, was also entirely different from the present case. There writs of attachment had been levied in two counties and the sheriffs had made returns of the writs. In this situation, the defendant executed directly to the plaintiff the undertaking sued on in the case, and thereupon the plaintiff himself released the attachments. For these reasons it was held that the undertaking was not authorized by either section 540 or sections 554 and 555, but that being given upon a sufficient consideration, the release of the attachment, it was a good common-law promise and bound the surety to its performance. The Bailey case has no particular application and need not be noticed.

In the present case all that appears is that the undertaking was "executed and delivered" to the plaintiff, and that thereupon the attachment was discharged and the property released. The undertaking is set out in full in the complaint and in the findings. It is entitled in the action and merely promises that if the plaintiff recover judgment, the surety will on demand pay the amount thereof to the plaintiff. It was executed and delivered to the plaintiff only in the sense that it was passed to the plaintiff instead of to the sheriff. It does not appear that the plaintiff himself released the property, but only that upon such delivery the property was released. So far as appears, the delivery to the plaintiff was for convenience only, and the property was released by the sheriff in the usual way, as upon the giving of the undertaking provided in section 540 This being the case, it should be regarded as an undertaking given in pursuance of that section, and as governed, with respect to a suit thereon, by the provisions of section 552 If anything further occurred between the parties at the time of its execution which would operate to change its character in this regard, it can be developed upon another trial. It does not appear from the record before us.

The petition for rehearing is denied.

Richards, J., pro tem., Melvin, J., Victor E. Shaw, J., protem., and Wilbur J., concurred. *Page 43