Opinion
A157607
09-25-2019
UMPQUA BANK, Plaintiff and Respondent, v. RENKA PROP LLC, Defendant and Appellant.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (City & County of San Francisco Super. Ct. No. CGC-18-564937)
Defendant Renka Prop LLC (Renka) appeals an order confirming the sale of real property by a court-appointed receiver. Plaintiff Umpqua Bank (the bank), which sought the appointment of the receiver and court authorization for the sale, has moved to dismiss the appeal on the ground that it is moot because during the pendency of the appeal the receiver completed the sale of the property to a third-party rendering it impossible for this court to grant Renka any effective relief. Renka does not attempt to explain how this court might fashion effective relief but argues nonetheless that this court should review the merits of the appeal because it raises a question of broad public interest that is likely to recur but may otherwise evade review. We shall dismiss the appeal.
Background
In December 2013, Renka executed a promissory note secured by a deed of trust on income-producing property on Eureka Street in San Francisco in favor of the bank in the principal amount of $1.325 million. In March 2018, when Renka defaulted on the loan, the bank filed the present action seeking appointment of a receiver to take possession of, care for, and manage and operate the property under the provisions of the deed of trust. Thereafter, the bank sought an order authorizing and instructing the receiver to list the property for sale. The bank's memorandum of points and authorities filed in support of its request explained, "Given the fact that the Receiver has been in possession of the Eureka Street Property for over five months, he believes it is in the best interest of the receivership estate for the Court to instruct the Receiver to enter into the Listing Agreement in order to attempt to sell the Eureka Street Property. In the event the Receiver is not authorized to sell the Eureka Street Property, it is his understanding that the Bank will proceed to commence and complete non-judicial foreclosure proceedings by conducting a trustee's sale with respect to the Eureka Street Property, which will damage the credit reputation of Renka and will also make it likely that the junior liens which have been recorded against the Eureka Street Property and Renka will not receive anything on account of their liens and Renka's ownership interest in the Eureka Street Property will be extinguished." On October 12, 2018, the court authorized listing the property.
On April 22, 2019, the bank filed a motion for approval of the sale of the property to a third-party buyer pursuant to Code of Civil Procedure sections 568 and 568.5. The motion was granted and the sale order was filed on May 21, 2019.
On the same day, Renka filed a notice of appeal from the sale order and also served a notice of stay, asserting that an automatic stay was in place pursuant to Code of Civil Procedure section 916 that prevented the receiver from closing the sale. On May 30, 2019, Renka filed a motion in the trial court to confirm that a bond was not required to stay execution of the sale order and requested a temporary stay pending resolution of its motion. On June 6, 2019, before the motion could be heard, the receiver closed the sale of the property in accordance with the sale order. Renka's motion was subsequently taken off calendar as moot.
Discussion
The bank's motion to dismiss asserts, among other grounds, that the closing of the sale of the property renders it impossible for this court to grant Renka effective relief. (See City of Riverside v. Horspool (2014) 223 Cal.App.4th 670, 682 ["An order appointing a receiver is not subject to appellate review after the receiver has settled accounts and been discharged because, at that point, the receiver and the court no longer have control of the subject matter of the receivership."]; First Federal Bank of California v. Fegen (2005) 131 Cal.App.4th 798, 801 [action challenging order for sale of property is moot when appellant failed to post an undertaking and the sale has been conducted and the property sold.].)
As noted above, Renka does not dispute that effective relief can no longer be granted. Renka argues we should not dismiss the appeal because "Umpqua and other similarly situated lenders misuse and will continue to misuse the receivership process to circumvent foreclosure law and then avoid appellate review by quickly selling the property and declaring the appeal moot." Renka contends that this court should review the merits of the appeal because this is a question of broad public interest likely to recur that will otherwise evade appellate review. (See California Correctional Peace Officers Assn. v. State of California (2000) 82 Cal.App.4th 294, 303-304 ["There is ample precedent for resolving important issues of substantial and continuing public interest that may otherwise evade review."].)
Assuming without deciding that the scope of a receiver's authority to sell property in its possession raises an important question of public policy, the record establishes that the issue evaded review in this case only as a result of Renka's failure to post a bond. (City of Riverside v. Horspool, supra, 223 Cal.App.4th at p. 682; First Federal Bank of California v. Fegen, supra, 131 Cal.App.4th at p. 801.) Renka's proffered excuse for failing to post a bond is not persuasive. Renka argues that it was not required to post a bond because the perfecting of the appeal automatically stayed the sale under Code of Civil Procedure section 916. While the parties vigorously dispute the applicability of the automatic stay provision, Renka failed to take the appropriate steps to determine that question when effective relief was still available. Had Renka believed the bank was wrongly refusing to acknowledge the applicability of the statutory provisions automatically staying the judgment while an appeal is pursued, its remedy was to file a petition for writ of supersedeas. (Quiles v. Parent (2017) 10 Cal.App.5th 130, 136 ["A writ of supersedeas is an appellate court order suspending the enforcement of a trial court judgment or order while an appeal is pending."]; Gallardo v. Specialty Restaurants Corp. (2000) 84 Cal.App.4th 463, 467 [" 'Supersedeas is the appropriate remedy when it appears that a party is refusing to acknowledge the applicability of statutory provisions "automatically" staying a judgment while an appeal is being pursued.' "].) An appellant may not forego posting a bond and shift the risks of delay pending appeal to the respondent. (See Hein v. Highlands Ins. Co. (1976) 64 Cal.App.3d 627, 633 ["The stay of enforcement inherently involved a risk of a decline in value of the property pending appeal. That risk should be borne by the party who appealed and her sureties, not by [the party], who was wronged by the stay."]; Cunningham v. Reynolds (1933) 133 Cal.App. 148, 150-151 ["The purpose of the undertaking is to protect the respondent."]; Code Civ. Proc., § 917 .4 [undertaking covers value of occupation, waste, and any deficiency in the case of mortgaged property].)
Renka's motion and request for temporary stay filed in the trial court was inadequate to perfect a stay of the judgment pending appeal.
Accordingly, the issue Renka seeks to raise need not escape appellate review when relief is possible and this appeal should be dismissed as moot.
Disposition
The appeal is dismissed.
/s/_________
POLLAK, P. J. WE CONCUR: /s/_________
STREETER, J. /s/_________
TUCHER, J.