Opinion
G062703
10-24-2024
THE PEOPLE, Plaintiff and Respondent, v. ACCREDITED SURETY AND CASUALTY COMPANY, INC., Defendant and Appellant.
Leon J. Page, County Counsel, and Suzanne E. Shoai, Deputy County Counsel for Plaintiff and Respondent. Law Office of John Rorabaugh and John Mark Rorabaugh for Defendant and Appellant.
NOT TO BE PUBLISHED
Appeal from a judgment of the Superior Court of Orange County, No. 19HM10667 Richard Pacheco, Judge. Reversed.
Leon J. Page, County Counsel, and Suzanne E. Shoai, Deputy County Counsel for Plaintiff and Respondent.
Law Office of John Rorabaugh and John Mark Rorabaugh for Defendant and Appellant.
OPINION
SANCHEZ, J.
This is an appeal from Accredited Surety and Casualty Company, Inc. (Accredited Surety), the surety on a bail bond, from a summary judgment on the bond. Accredited Surety contends that the court lost jurisdiction to enforce the bond because it failed to comply with mandatory notice requirements in Penal Code section 1305. We agree with that contention and reverse the judgment.
All statutory references are to the Penal Code.
FACTS
In September 2019, Accredited Surety, through its bail bond agent, Velocity Bail Bonds, posted a bond in the amount of $50,000 for the release of defendant Juan Diegolopez Mendoza from custody.
On December 14, 2020, the defendant did not appear in court. The docket reflects that the court forfeited bail in open court and issued a $60,000 bail bench warrant. As we explain below, at that point the court should have mailed a notice of forfeiture to the bond agent and the surety. However, the court file does not reflect that it mailed a notice of forfeiture for the December 14, 2020, forfeiture.
Later that same day, the defendant appeared in court. The trial court ordered the bond forfeiture vacated and the bail bond reinstated. On the same day, Velocity Bail Bonds filed a reassumption of liability of bail bond, stating, "In conjunction with the forfeiture of the bail bond . . . having been set aside by the above entitled court . . .[,] the surety thereon, does hereby reassume all of the obligations thereunder and does expressly consent to the reinstatement of said bail bond." This was signed by both the attorney for Velocity Bail Bonds and the court, but not by Accredited Surety.
About a year later, on December 17, 2021, the defendant again failed to appear in court. Bail was ordered forfeited. This time, a Notice of Order Forfeiting Surety Bond was mailed to both Velocity Bail Bonds and Accredited Surety.
On February 23, 2023, the court entered summary judgment on the forfeited bail bond in favor of the People in the amount of $50,000.
On April 4, 2023, Accredited Surety filed a motion to set aside the summary judgment. The motion was based on the fact that the court did not mail a notice of forfeiture the first time defendant failed to appear and the court forfeited bail (December 14, 2020), which, Accredited Surety argued, deprived the court of jurisdiction over the bond. On May 16, 2023, the court denied the motion to set aside summary judgment and exonerate bail, reasoning that because the bond agent had actual notice of the forfeiture and reassumed the bond, the court retained jurisdiction over the bond.
Accredited Surety timely appealed.
DISCUSSION
The sole question presented in this appeal is whether the court lost jurisdiction over the bond when, on December 14, 2020, it initially declared the bond forfeited, yet failed to serve a notice of forfeiture within 30 days. To answer this question, we begin by reviewing the procedures applicable to bond forfeitures.
"While bail bond proceedings occur in connection with criminal prosecutions, they are independent from and collateral to the prosecutions and are civil in nature." (People v. American Contractors Indemnity Co. (2004) 33 Cal.4th 653, 657.) "[T]he 'bail bond is a contract between the surety and the government whereby the surety acts as a guarantor of the defendant's appearance in court under the risk of forfeiture of the bond.'" (Ibid.)
"When a person for whom a bail bond has been posted fails without sufficient excuse to appear as required, the trial court must declare a forfeiture of the bond. (§ 1305, subd. (a).) The surety that posted the bond then has a statutory [185 day] 'appearance' period in which either to produce the accused in court and have the forfeiture set aside, or to demonstrate other circumstances requiring the court to vacate the forfeiture. If the forfeiture is not set aside by the end of the appearance period, the court is required to enter summary judgment against the surety." (Id. at p. 658.) (footnote omitted).) "If summary judgment is not entered within the statutory 90-day period, the bond is exonerated. (§ 1306, subd. (c).)" (Ibid.)
The critical procedure at issue here is the mailing of a notice of forfeiture. Section 1305, subdivision (b)(1), provides, "If the amount of the bond or money or property deposited exceeds four hundred dollars ($400), the clerk of the court shall, within 30 days of the forfeiture, mail notice of the forfeiture to the surety or the depositor of money posted instead of bail. At the same time, the court shall mail a copy of the forfeiture notice to the bail agent whose name appears on the bond. The clerk shall also execute a certificate of mailing of the forfeiture notice and shall place the certificate in the court's file." Subdivision (b)(3) relieves the bond agent/surety of all obligations under the bond if the court fails to mail that notice: "The surety or depositor shall be released of all obligations under the bond if any of the following conditions apply: [¶] (A) The clerk fails to mail the notice of forfeiture in accordance with this section within 30 days after the entry of the forfeiture."
The notice of forfeiture requirement has been described as jurisdictional: "Failure to give the surety notice is a jurisdictional defect."(County of Madera v. Ranger Ins. Co. (1991) 230 Cal.App.3d 271, 279.) "Because the law disfavors forfeitures, sections 1305 and 1306 must be strictly construed in favor of the surety to avoid a forfeiture of the bond." (County of Los Angeles v. Ranger Ins. Co. (1999) 70 Cal.App.4th 10, 16.) "The standard of review, therefore, compels us to protect the surety, and more importantly the individual citizens who pledge to the surety their property on behalf of persons seeking release from custody, in order to obtain the corporate bond." (County of Los Angeles v. Surety Ins. Co. (1984) 162 Cal.App.3d 58, 62.) "Failure to follow the jurisdictional prescriptions in sections 1305 and 1306 renders a summary judgment on the bail bond void." (County of Los Angeles v. Ranger Ins. Co. (1999) 70 Cal.App.4th 10, 16.)
This is jurisdictional in the sense of being in excess of the court's authority, not a total lack of subject matter jurisdiction. (People v. National Automobile & Casualty Ins. Co. (2000) 82 Cal.App.4th 120, 126.)
On December 14, 2020, the court declared the bond forfeited in open court, thus starting the appearance period. However, that same day, defendant appeared and Velocity Bail Bonds reassumed the bond. The court did not mail a notice of forfeiture within 30 days. The question before us is whether the failure to send notice released the surety of all obligations under the bond. On its face, the answer under section 1305 would seem to be yes: the bond must be exonerated and the surety released of its obligations on these facts.
However, the trial court concluded that the bond agent had actual notice of the bond forfeiture, as demonstrated by the reassumption of the bond that it filed the same day, and thus the surety continued to be obligated under the terms of the bond. In defending that ruling, the People rely on an actual-notice exception carved out by some courts.
The actual notice exception stems from People v. Ranger Ins. Co. (1996) 51 Cal.App.4th 1379. There, the clerk had mailed a notice of forfeiture to the wrong entity, but that entity forwarded the notice of forfeiture to the surety. "Because actual notice was received, although it was forwarded by Douglass to the surety, the statute's goal of effective notice was achieved in this instance. [Citation.] Because there was actual notice, there is no circumstance up to that point which defeats the trial court's forfeiture of the bond." (Id. at p. 1385; see also People v. American Bankers Ins. Co. (1991) 227 Cal.App.3d 1289, 1295 [notice mailed to surety and wrong bond agent, but forwarded to correct agent, provided adequate notice], overruled on other grounds in People v. National Automobile &Casualty Ins. Co. (2000) 82 Cal.App.4th 120, 126.)
This actual-notice exception does not apply here for one critical reason: the surety did not have actual notice. "The surety and bail agent are entitled to separate notice under the statute every time a forfeiture is declared." (County of Orange v. Lexington Nat. Ins. Corp. (2006) 140 Cal.App.4th 1488, 1493.) While it may have been true that the reassumption by Velocity Bail Bonds evidenced its actual notice of the forfeiture, the reassumption was not separately signed by Accredited Surety. Nor is there a proof of service in our record demonstrating timely notice to Accredited Surety. There is simply no evidence in the record that Accredited Surety was given any notice of the forfeiture.
The court reached this same result in County of Los Angeles v. Financial Casualty &Surety, Inc. (2016) 247 Cal.App.4th 875, 883. There, the court reasoned, "According to the County, mailing notice would have been pointless because the court clerk called [the surety]. Impliedly, the County suggests that the actual notice exception should apply. But the record indicates that the court clerk called the bond agent, not [the surety], to communicate the trial court's intention to reinstate the bond. There is no evidence that the bond agent informed [the surety] and gave it actual notice of the forfeiture." On those facts, the court held the bond exonerated.
Similarly, here, the prescription of section 1305 is clear: the bond was exonerated, and the summary judgment is void.
DISPOSITION
The judgment is reversed. Accredited Surety shall recover its costs incurred on appeal.
WE CONCUR: O'LEARY, P. J. MOTOIKE, J.