Filed 6/26/15 County of Los Angeles v. Fi nancial Casualty & S urety CA2/1 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

COUNTY OF LOS ANGELES,
Plaintiff and Respondent,

v.

F INANCIAL CASUALTY & SURETY, INC.,
Defendant and Appellant. B254010
(Los Angeles County Super. Ct. No. SJ3716)

APPEAL from an order of the Superior Court of Los Angeles County. Lia R. Martin, Judge. Order denying interest r everse d and remanded with directions

.

______ John M. Rorabaugh for Defendant and Appellant. Mark J. Saladino, County Counsel, Ruben Baeza, Jr., Assistant County Counsel,
and Joanne Nielsen, Principal Deputy County Counsel, for Plaintiff and Respondent.

______2

Fina ncial Casualty & Surety, Inc. (Financial ) appeals from th at portion of

an order in which the trial court denied interest on its motion for restitution pursuant to
Code of Civil Procedure section 908. Financial contends that the court abused its
discre tion in denying interest. We agree and thus reverse and remand the matter with
directions.
FACTUAL AND PROCEDURAL BACKGROUND On June 11, 2011, Financial posted a $100,000 bond for the release of criminal
defendant Luciano Villa. When Villa failed to app ear in court on June 24, bail was
forfeited

. Financial moved to vacate the forfeiture and exonerate the bond on the ground
that Villa had been deported on June 13 and thus
, under Penal Code section 1305, subdivision (d), was “permanently unable to appear in the court.” Based on a finding of

“ unclean hands, ” the trial court (Hon. Mark A. Young) denied Financial’s motion and entered judgment on the forfeited bond

. Financial appealed. On April 10, 2012, during the pendency of the appeal, Financial paid the judgment , which totaled $101,493.29
, including court costs and interest, to the County of Los Angeles (County)

. We reversed the judgment
, concluding that the trial court had appli ed an incorrect legal standard to deny Financial ’s motion. ( County of Los Angeles v. Financial Casualty & Surety, Inc . (2013) 216 Cal.App.4 th 1192, 1195

- 1196 .) Because relief from the
forfeiture of bail under Penal Code section 1306 is neither discretionary nor dependent

on “‘ clean hands, ’ ” we held that exoneration is mandatory so long as the defendant’s
absence is “‘ without the connivance of the bail
, ’ ” and no evidence existed that Financial
had connived in Villa’s absence

. ( I bi d .) Our r emittitur issue d on August 1, 2013. On October 3, Financial moved under Code of Civil Pro cedure section 908 for
restitution , including interest on the money it had paid the County

. The County opposed Financial’s request for interest. O n December 11, t he trial court (Hon. Lia R. Martin) entered an order awarding restitution in the amount paid , $101,493.29 , but den ying
interest . According to the court, an interest award was not equitable under the
circumstances because the County had demanded payment of the judgment pursuant to Penal Code section 1306 , which under subdivision (f) provides a tw o

- year limitation3

from entry of judgment for enforcement. On December 17, the County paid Financial $101,493.29. Financial appeal ed from that portion of the order denying interest

. DISCUSSION Code of Civil Procedure section 908 provides that
, upon revers al or modification of a judgment, “ the reviewing court may direct that the parties be returned so far as possible to the positions they occupied before the enforcement of or exec ution on the judgment or order. In doing so, the reviewing court may order re stitution on reasonable terms and conditions of all property and rights lost by the erroneous judgment or
order.

. . . ” “[ A ] trial court whose order or judgment has been reversed on appeal has
inherent authority to afford similar relief. [Citations.] ” ( Gunderson v. Wall (2011)
196 Cal.App.4 th 1060, 1065 ( Gunderson ) .)

“‘ The fundamental rule guiding the court [in awarding restitution under Code of Civil Procedure section 908] [i]s, so far as possible, to plac e the parties in as favorable

a position as they could have been in had the judgment[] not been enforced pending appeal.’ [Citation.]” ( Gunderson
, supra , 196 Cal.App.4th at p. 1065

. ) A n interest award routinely is part of restitution following the reversal of a money judgment unless such

an award would be inequitable under the circumstances. ( Textron Financial Corp. v.
National Union Fire Ins. Co. (2004) 118 Cal.App. 4th 1061, 1085 ( Textron ) , disapproved on other grounds in Zhang v. Superior Court (2013) 57 Cal.4th 364, 377

- 379 .) Courts “generall y reason[] that [] payment of interest is appropriate because a plaintiff who collects his judgment pending appeal assumes the risk that it may have to repay the award, along with interest, if the defen dant prevails in that appeal. [Citations.] ” ( Gunderso n , at p p . 1066

- 1067.) The decision w hether to award interest as restitution is a question of “judicial discretion in deter mining what equity require[s].” ( Stockton Theatres, Inc. v. Palermo (1953 ) 121 Cal.App.2d 616, 632; see also Textron , at p. 1085

. ) Denying interes t here did not place Financial “‘ in as favorable a position as [it] could have been in had the judgment[] not been enforced pending appeal.’” ( Gunderson
, supra , 196 Cal.App.4th at p. 1065.) Financial lost the time value of its money betwee n the time it paid the judgment to the County and the date the County returned its money4

after our reversal of the judgment

. Although the County demanded payment of the judgment pur suant to Penal Code section 1306
, which und er subdivision (f) gives it

two years from entry of judgment for enforcement, payment of interest fulfills the purpose of Code of Civil Procedure section 908 to return Financial to the position it occupied before enforcement of the judgment that we reversed on appeal . No evidence
exist s that Financial acted inequitably in postjudgment proce edings to render the denial
of interest an appropriate act of discretion. ( See Gunderson
, supra , 1 96 Cal.App.4 th

at p p

. 1 06 7

- 1068 [denial of interest affirmed because defendant who ultimately paid ju dgment pending appeal engaged in inequitable postjudgment conduct that
caused plaintiff to incur substantial costs in enforcing the judgment ].) Under these circumstances, an award of interest as restitution is appropriate pursuant to Code of Civil
Procedu re section 908

. ( Textron , supra , 118 Cal.App.4th at p p. 1085

- 1086 [interest
award ed as restitution when defendant had paid judgment based on plaintiff’s threat

to execute on it and no evidence existed that defendant had acted inequitably in postjudgment p roceedings ].) We , therefore, reverse the denial of interest and remand the
matter for the trial court to determine a reasonable interest rate and award interest from the date Financial paid the judgment (April 10, 2012) through the date the County

re turne d the money (December 17, 2013 ). 1

1 We note that interest rates are, and have been, low. (See, e.g., Department of the Treasury, Resource Center, D aily Treasury Yield Curve Rates
< http://www.treasury.gov/resource

- center/data

- chart

- center/interest

rates/Pages/TextView.aspx?data=yield > [ tre asury yie ld curve rate on 10

- year United States treasury bond 2.19 percent as of June 1, 2015 ].) Although Financial asks for interest at a rate of 10 percent per annum pursuant to Civil Code sections 3287 and 3289 , those provisions do not govern a restitu tion award under Code of Civil Procedure section 908 . In addition, Financial has not demonstrated that an interest rate of 10 percent would be the appropriate interest rate to restore it to as favorable a position as it could have been in had the judgment not been enforced pending appeal.5 DISPOSITION
The order insofar as the trial court denied interest is reverse d and remanded with
directions. On remand, t he court shall determine a reasonable interest rate to restore Financial to its former position and a ward Financial that interest on the amount of $101,493.29 from April 10, 2012 through December 17, 2013

. Financial is entitled to recover its costs on appeal.
NOT TO BE PUBLISHED

.

ROTHSCHILD, P. J. We concur:

CHANEY, J.

JOHNSON, J.