Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-04212/USCOURTS-cand-3_05-cv-04212-1/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1335 Interpleader Action

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

PLM LENDER SERVICES, INC.,

Plaintiff,

 v.

KATHLEEN E. GIOLETTI, et al.,

Defendants. /

No. C 05-4212 EMC

ORDER DENYING WITHOUT

PREJUDICE PLAINTIFF’S EX PARTE

APPLICATION TO SERVE DEFENDANT

NORTH AMERICAN CAPITAL GROUP,

INC. PURSUANT TO CALIFORNIA

CORPORATIONS CODE § 1702(A)

(Docket no. 22)

Before the Court is the Ex Parte Application of Plaintiff PLM LENDER SERVICES, INC.

(“PLM”) to serve Defendant NORTH AMERICAN CAPITAL GROUP, INC., a California

corporation, pursuant to California Corporations Code § 1702(a) and (d), by hand-delivery of the

Summons and Complaint in the above-entitled action to the California Secretary of State or the

California Secretary of State’s assistant or deputy. The Court DENIES the Ex Parte Application for

the reasons stated below.

Section 1702(a) of the California Corporations Code, applicable here pursuant to Rule

4(h)(1) of the Federal Rules of Civil Procedure, provides in relevant part:

//

Case 3:05-cv-04212-MMC Document 30 Filed 01/26/06 Page 1 of 3
United States District Court

For the Northern District of California

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(a) If an agent for the service of process . . . cannot with reasonable diligence be found at the

address designated for personally delivering the process, or if no agent has been designated,

and it is shown by affidavit to the satisfaction of the court that process against a domestic

corporation cannot be served with reasonable diligence upon the designated agent by hand in

the manner provided in Section 415.10, subdivision (a) of Section 415.20 or subdivision (a)

of Section 415.30 of the Code of Civil Procedure or upon the corporation in the manner

provided in subdivision (a), (b) or (c) of Section 416.10 or subdivision (a) of Section 416.20

of the Code of Civil Procedure, the court may make an order that the service be made upon

the corporation by delivering by hand to the Secretary of State, or to any person employed in

the Secretary of State’s office in the capacity of assistant or deputy, one copy of the process

for each defendant to be served, together with a copy of the order authorizing such service.

West’s Ann. Cal. Corp. Code § 1702(a) (1990) (emphasis added). Section 416.10 of the Code of

Civil Procedure, which provides for service on corporations, refers to this section of the

Corporations Code and permits “service to be made on the Secretary of State when no officer or

agent of the corporation can be found within this state after diligent search.” Cal. Judicial Council

com., 14B West’s Ann. Code Civ. Proc. § 416.10 (2004) (referring to Judicial Council comment to

Section 415.50 for discussion of the term “diligent search”). 

The requirement that a party exercise “reasonable diligence” in attempting to locate the party

to be served involves a “‘thorough, systematic investigation and inquiry conducted in good faith by

the party or his agent or attorney.’” Kott v. Superior Court, 53 Cal. Rptr. 2d 215, 221 (Cal. Ct. App.

2d, 1996) (quoting Cal. Judicial Council com., 14 West’s Ann. Code Civ. Proc.§ 415.50 (1973)). 

“‘A number of honest attempts to learn defendant’s whereabouts or his address by inquiry of

relatives, friends, and acquaintances, or of his employer, and by investigation of appropriate city and

telephone directories, the voters’ register, and the real and personal property index in the assessor’s

office, near the defendant’s last known location, are generally sufficient.’” Id. 

In Kott, the Court of Appeal directed the trial court to grant the motion to quash service, 

finding that the plaintiffs filed an application for publication of summons after discovering that the

defendant resided in, and was a citizen of, Canada. The court held that the plaintiffs made no effort

whatsoever to locate an address in Canada, and failed to consult obvious sources to request

Case 3:05-cv-04212-MMC Document 30 Filed 01/26/06 Page 2 of 3
United States District Court

For the Northern District of California

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information on the defendant’s current business or residence address, such as by asking defense

counsel or other defendants that had already been served, either informally or by interrogatories. Id.

at 1138-39. See also Wright v. Domain Service, Inc., 2002 U.S. Dist. LEXIS 16024 (N.D. Ill., 2002)

(where plaintiff served California corporation by substituted service pursuant to Cal. Code Civ.

Proc. § 416.10(d)). In Wright, the district court found that plaintiff had demonstrated “by various

forms of documentary evidence that his diligent efforts to obtain personal service on [defendant] at

any of its known places of business were unsuccessful”and obtained leave to substitute service on

the Secretary of State of California. Id. at *5. 

Here, PLM has not established in its papers that it has searched for Defendant’s agent for

service of process with reasonable diligence as required by the rules of service under California law. 

It has not discussed, for instance, what efforts it has made to locate the agent after learning that he

was no longer available at the registered address. 

Therefore, it is ordered that PLM’s Ex Parte Application is DENIED without prejudice to

renew its application to serve Defendant pursuant to Section 1702(a) of the California Corporations

Code after conducting a reasonably diligent search for the registered agent for service of process, as

evidenced by a declaration.

It is further ordered that PLM shall have an additional thirty (30) days to complete service of

process on Defendant North American Capital Group, Inc.

IT IS SO ORDERED.

Dated: January 26, 2006 

EDWARD M. CHEN

UNITED STATES MAGISTRATE JUDGE

Case 3:05-cv-04212-MMC Document 30 Filed 01/26/06 Page 3 of 3