Q: I am a receiver appointed pursuant to
stipulation in an action pending in superior court between a husband and a
wife over the operation of a business they own. After operating the
business for many months, I agreed to a settlement with the husband
resolving many of the disputed issues. The wife disagreed with the
proposed settlement and moved to transfer the litigation to the family law
court. After the action was transferred, the judge in the family court
ruled that the original judge who appointed me had no jurisdiction to do
so and that the appointment was “void.” The judge did indicate that I
could seek payment for my services. The wife’s attorneys have objected to
all my fees, contending that the reasonable value of my services was zero.
Big surprise, but that’s another story. Was the court correct in its
ruling that the order of the first superior court judge appointing me
receiver was void?
A: It is unclear from your
question whether the family law case was pending prior to the action in
which you were appointed receiver. That could affect the jurisdiction of
the court. If the family law case was already pending, disputes between
the husband and the wife should have proceeded before it. If the family
law case was not pending, because a family law judge does not sit on the
court of appeal, it was inappropriate for the family law judge to declare
an order issued but another superior court judge “void.” Because the
action was transferred from a civil department to the family law
department, the family law judge took control of the case and had the
right to terminate the receivership and your services at any time.
Declaring your order of appointment “void,” however,
can have negative unintended consequences. It could raise issues of
liability for you, as receiver, for having taken actions pursuant to a
“void” order. But see Binney v. San Dimas Lemon Ass’n, 81Cal.App.
213, 220 (1927) (holding that a receiver is not responsible for the court
exceeding its authority). It could also affect who is responsible to pay
your fees, because there is case law holding that if an appointing order
is void or improper, the party who sought the receiver’s appointment may
be responsible for the fees, rather than the receivership estate. See
Louis v. Hill, 38Cal.App. 329, 336 (1918). Here because you were
appointed pursuant to a stipulation of the parties, your fees should
probably be paid either out of the assets of the estate or by both
parties, although that is a decision ultimately for the new judge. This
situation is similar to a case decided long ago by the California Supreme
Court in Williams v. Superior Court, 14 Cal.2d 656, 662(1939).
There, one superior court judge issued an order to show cause why a court
reporter should not be held in contempt for violating a prior court order
directing the reporter to prepare a trial record needed for an appeal by a
certain date. A different judge, on motion of the reporter, issued an
order that the first judge’s order was void for want of jurisdiction. The
Supreme Court held:
The state Constitution (Art. VI, Sec 6)
provides for but one superior court in each county…and that the judgments,
orders and proceedings of any one session of the superior court held by
any one or more of the judges thereof shall be equally effectual as though
all the judges of said court presided at such session. Accordingly, it has
been held that jurisdiction is vested by the Constitution in the court and
not in any particular judge or department thereof;…therefore, that where a
proceeding has been duly assigned for hearing and determination to one
department of the superior court by the presiding judge of said court in
conformity with the rules thereof, and the proceeding so assigned has not
been finally disposed of therein or legally removed there from, it is
beyond the jurisdictional authority of another department of the same
court to interfere with the exercise of the power of the department to
which the proceeding has been so assigned.
The Court also went on to note: “[I]t is
well settled that if one department of a court exercises authority in a
matter which might properly be heard in another, the action constitutes at
most an irregularity and doesn’t affect the jurisdiction” Id. at
663.
*Peter A. Davidson is a Partner of Ervin Cohen & Jessup LLP a
Beverly Hills Law Firm. His practice includes representing Receivers and
acting as a Receiver in State and Federal Court. |