Chapter 11. Foreclosure Of Bond Lien of California Streets And Highways Code >> Division 7. >> Part 5. >> Chapter 11.

As a separate, distinct and cumulative remedy, the holder of any bond upon which any payment either upon the principal or of the interest has become delinquent may, if the city which initiated the proceedings is not a county, at any time after three months after the date it is provided by ordinance or charter of the city that taxes are due, or if a county initiated the proceedings or collects the taxes for the city at any time after four months next succeeding the fourth Monday of September, following the date of delinquency of principal or interest and prior to the expiration of four years after the due date of the last installment upon any bond or of the last principal coupon attached thereto, file and maintain an action to foreclose the lien of the bond and recover the amount due thereon. No action shall be commenced pursuant to this section until the expiration of 15 days after a notice containing the amount of the payment due, the date the payment is or was due, penalties which may accrue for failure to pay, and notice of the foreclosure action which may occur if payment is not made is mailed, postage prepaid and registered, by the bondholder, or his representative, to the owner of the property at his last known address as it appears on the tax rolls.

The action may be brought also at any time following the expiration of 30 days after the service of personal demand for payment upon the owner of the premises. Such demand shall be served in the manner provided by law for the service of a summons in a civil action. If the action is brought costs for the service of the demand shall be allowed in an amount equivalent to the fees prescribed by law for the service of summons. The demand shall be in substantially the following form:

"Demand for Payment of Street Improvement Bond

You are hereby notified that Bond No. ____ Series No. ____ for an improvement in the City (or County) of ____ is delinquent. Unless the amount of the unpaid principal on said bond together with interest and penalties is paid to the city (or county) treasurer on or before 30 days after the service on you of this demand, the date of such service being this ____ day of ____, 19__, the undersigned will institute suit to foreclose the lien of said bond in the manner prescribed by law."

The action shall be brought in the superior court of the county in which the proceedings were initiated and if the owner of the lot or parcel of land covered by the bond can not with due diligence be found, the service of summons in such action may be had in the manner prescribed by law.

The complaint in the action shall be sufficient if it sets forth a true copy of the bond and makes appropriate allegations regarding the payments made upon the principal and interest of the bond and the mailing of the notice required pursuant to Section 6610. If personal demand for payment is made the complaint shall so allege.

The bond, together with proof, either orally by the treasurer or by a certificate signed by him showing the nonpayment of any of the principal or interest upon the bond, shall be prima facie evidence of the right of the plaintiff to recover in the action. If personal demand for payment was made, proof of personal service of the demand shall be required.

The court may adjudge and decree a lien against the lot or parcel of land covered by the bond and cause the premises to be sold as in other cases of the sale of real estate by the process of the court to satisfy and discharge the bond and lien, and the amount of interest and penalties due shall be calculated at the rates and in the manner specified in this part for such calculation of interest and penalties, and shall be calculated and allowed up to the date of judgment. The court having jurisdiction of the action shall also fix and allow a reasonable attorney's fee for the prosecution of the action.

The plaintiff in the action may also recover the actual cost of any abstract or report of search of title procured in good faith, in order to determine ownership, if it is made by a reputable abstracter or title company, if the abstract or report of search with an affidavit of payment is filed in the action.

The action shall be governed and regulated by the provisions of this chapter and by the other provisions of law which are not in conflict herewith.

A written notice of the pendency of any action for recovery on a bond shall be filed with the treasurer. After the filing of such notice the treasurer shall not receive any money on account of the bond and shall have no authority to cancel the entries on the bond in the register or give a discharge of the bond without the written consent of the owner thereof until judgment has been rendered in the action or until it has been dismissed. Upon the entry of judgment or dismissal of the action the clerk of the court shall forthwith mail to the treasurer a certified copy of the judgment or other evidence sufficient to advise the treasurer of the judgment of the court in the action.

If an action is brought for recovery on any bond prior to the time specified in this chapter, the plaintiff shall not recover in such action and the defendant shall be entitled to have and recover such attorney fees as the court deems reasonable, in addition to all taxable costs.

Whenever a bond is foreclosed pursuant to this chapter, the decree of foreclosure shall direct the clerk of the court to deliver the bond sued upon to the treasurer of the city which issued said bond together with a memorandum setting forth the title and number of the action and the fact that the bond has been foreclosed.

The treasurer shall cancel the bond upon the records and deliver to the clerk of the court a receipt substantially in the following form:

"Certificate of Cancellation of Street Improvement Bond Series (designating it), in the City (or County) of (naming it).

$__________/100 No. ____

I, ____, Treasurer of the City (or County) of ____ do hereby certify that I have received the above bond from the clerk of the Superior Court of ____ (naming county) in that certain foreclosure action entitled ____ vs. ____ No. ____, Superior Court of ____ County; and I have this day canceled said bond on my records, pursuant to the order of the court made in said case.

Dated at_____, this_____ day of_____, 20__. _________________________________ Treasurer of the City (or County) of ______________________ By ______________________________ Deputy"

The clerk of the court shall enter the judgment or decree of foreclosure in the action upon the delivery of the certificate of cancellation.