Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-00770/USCOURTS-cand-3_07-cv-00770-6/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Breach of Contract

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

TRAVELERS CASUALTY AND SURETY

COMPANY OF AMERICA, a Connecticut

corporation,

Plaintiff,

 v.

J.K. MERZ CONSTRUCTION, INC.,

a California corporation, JOHN K. MERZ,

an individual, SALLY P. MERZ, an individual,

JOHN K. MERZ, SR. AND SALLY P. MERZ

AS THE CO-TRUSTEES OF THE MERZ

FAMILY TRUST U/D/T DTD 10/29/2004,

Defendants. /

No. C 07-00770 WHA

ORDER OVERRULING

OBJECTION TO REPORT

AND RECOMMENDATION

AND DENYING REQUEST

TO AUGMENT RECORD

On referral, Magistrate Judge Wayne Brazil issued a report and recommendation to

grant plaintiff’s application for a writ of attachment. A timely objection was made by

defendants. A motion to expand the record was made simultaneously with the objection, as

allowed by our local rule. No particular timetable or hearing is contemplated by our local rule

or by FRCP 72. 

The motion to augment is DENIED. Nothing is raised therein that with diligence could

not have been gathered, so far as the showing discloses, by the time of the proceedings before

Judge Brazil. Moreover, the additional material would be futile, for the whole point of the

collateral provision is to protect plaintiff against the contended claim, even if it has a low

Case 3:07-cv-00770-WHA Document 82 Filed 12/17/07 Page 1 of 2
United States District Court

For the Northern District of California

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probability of success. This also disposes of the first objection to the report and

recommendation. 

It also disposes of the second objection. Plaintiff is entitled to collateralize its

contingent liability to the City, even if plaintiff is actively contesting the liability and even if

the City has a weak case. The reason is that the City may win yet and plaintiff could be left

holding an empty bag. The whole point of the collateral-security provision was to

collateralize a potential indemnity duty. It was not limited to only probable indemnity duties. 

Defendants made a promise to collateralize. Now they should live up to it. 

The report and recommendation of Judge Brazil is careful and well-reasoned and hereby

adopted. It shall be enforced immediately. Within SEVEN CALENDAR DAYS, plaintiff shall

submit an appropriate form of order. 

IT IS SO ORDERED.

Dated: December 17, 2007. 

WILLIAM ALSUP

UNITED STATES DISTRICT JUDGE

Case 3:07-cv-00770-WHA Document 82 Filed 12/17/07 Page 2 of 2