Cal. PROB § 2551 — California Code / Code prob / Division 4 / Part 4 / Chapter 6 / Article 8 / Section 2551
Section 2551
Status: in_force

(a) In any case described in Section 2541 or Section 2552, the guardian or conservator, after authorization by order of the court, may borrow money upon a note, either unsecured or to be secured by a security interest or other lien on the personal property of the estate or any part thereof or to be secured by a mortgage or deed of trust on the real property of the estate or any part thereof. The guardian or conservator shall apply the money to the purpose specified in the order.

(b) To obtain an order under this section, the guardian or conservator, the ward or conservatee, or any other interested person may file a petition with the court. The petition shall state the purpose for which the order is sought, the necessity for or advantage to accrue from the order, the amount of money proposed to be borrowed, the rate of interest to be paid, the length of time the note is to run, and a general description of the property proposed to be mortgaged or subjected to a deed of trust or other lien. Notice of the hearing on the petition shall be given for the period and in the manner provided in Chapter 3 (commencing with Section 1460) of Part 1.

(c) The court may require such additional proof of the fairness and feasibility of the transaction as the court determines is necessary. If the required showing is made, the court may make an order authorizing the transaction.

The court in its order may do any one or more of the following:

(1) Order that the amount specified in the petition, or a lesser amount, be borrowed.

(2) Prescribe the maximum rate of interest and the period of the loan.

(3) Require that the interest and the whole or any part of the principal be paid from time to time out of the estate or any part thereof.

(4) Require that the personal property used as security or any buildings on real property to be mortgaged or subjected to the deed of trust be insured for the further security of the lender and that the premiums be paid out of the estate.

(5) Specify the purpose for which the money to be borrowed is to be applied.

(6) Prescribe such other terms and conditions concerning the transaction as the court determines to be to the advantage of the estate.

(d) The note and the mortgage or deed of trust, if any, shall be signed by the guardian or conservator.

(e) Jurisdiction of the court to administer the estate of the ward or conservatee is effectual to vest the court with jurisdiction to make the order for the note and for the security interest, lien, mortgage, or deed of trust. This jurisdiction shall conclusively inure to the benefit of the owner of the security interest or lien, mortgagee named in the mortgage, or the trustee and beneficiary named in the deed of trust, and their heirs and assigns. No omission, error, or irregularity in the proceedings shall impair or invalidate the proceedings or the note, security interest, lien, mortgage, or deed of trust given pursuant to an order under this section.

(f) Upon any foreclosure or sale under a security interest, lien, mortgage, or deed of trust described in subdivision (a), if the proceeds of the sale of the encumbered property are insufficient to pay the note, the security interest, lien, mortgage, or deed of trust, and the costs or expenses of sale, no judgment or claim for any deficiency may be had or allowed against the ward or conservatee or the estate.