Union Bank v. County of Los Angeles

FOURT, J. This is an appeal by plaintiff Union Bank (hereinafter referred to as “Union”) from a judgment of dismissal entered after the trial court sustained a demurrer without leave to amend on the sole ground that Union did not have capacity to sue. Defendants’ demurrer insofar as it related to Union’s coplaintiff Hancock Acceptance Corp. (hereinafter referred to as “Hancock”), was overruled and Hancock is not a party to the within appeal.

The chronology of significant events is as follows: On May 28, 1962, plaintiffs filed a complaint in three counts seeking an injunction and declaratory relief. Union and Hancock were eoplaintiffs in the first and third counts. It was therein alleged in substance as follows: On or about August 2, 1960, Continental Electronics Corporation of California (hereinafter referred to as “Electronics”) duly made, executed and delivered to Union a chattel mortgage on certain office furniture, shop machinery and equipment, and other personal property, to secure the payment of an indebtedness to Union evidenced by a promissory note in the principal sum of $54,999.84. The chattel mortgage was subsequently recorded. Thereafter, Continental Industrial Electronics Corp. (hereinafter referred to as “Industrial”) acquired all of the assets and assumed all of the liabilities of Electronics, including the obligation to repay the balance of the note secured by the aforementioned chattel mortgage.

On the first Monday in March 1962 the County Assessor of Los Angeles County duly assessed the various assets of Industrial (consisting solely of “solvent credits,” “trade fixtures,” and “personal property”) and computed the personal property tax thereon for the tax year 1962 to 1963 to be $5,598.67. Defendants determined that the aforesaid personal property tax was on “unsecured property” as defined in Revenue and Taxation Code, section 134 and sections 2901 et seq., and sent a tax bill to Industrial for that amount, which tax bill was and is unpaid.

Thereafter, on April 25, 1962, Union foreclosed its chattel mortgage and took physical possession of the mortgaged property and on May 1, 1962, entered into an agreement to sell it to Union’s coplaintiff Hancock.1 The agreement pro[689]vided that Union would, forthwith, deliver possession of the personal property to Hancock and would pass title to Hancock at the close of an escrow on May 29, 1962. Pursuant to the agreement, possession of the personal property was delivered to Hancock on or about May 1,1962.