天美传媒

California business owners often find themselves involved in litigation to enforce their rights as creditors. Provisional remedies are a valuable tool of the California legal system. The purpose of a聽provisional remedy聽is to preserve the聽status quo聽until a matter reaches its final disposition. When time is money, parties may find temporary relief and avoid irreversible damages through provisional remedies.

In California, the term 鈥減rovisional remedy鈥 includes the following:

(1)鈥侫ttachments and temporary protective orders (Cal. Civ. Code 搂 481.010).

(2)鈥俉rits of possession (Cal. Civ. Code 搂 512.010).

(3)鈥侾reliminary injunctions and temporary restraining orders (Cal. Civ. Code 搂 527).

(4)鈥俁eceivers (Cal. Civ. Code 搂 564).

For such a remedy to serve its purpose, procedural safeguards are sacrificed and therefore fewer than in a typical 鈥渓awsuit to trial to judgment鈥 scenario. Because provisional remedies deprive parties of life and liberty prior to trial or judgment, due process analysis and considerations apply.

Courts still employ some safeguards before ordering provisional remedies. First, some type of hearing is held, even if it is ex parte. Courts may bypass a hearing when issuing temporary restraining orders聽(鈥淭RO鈥) and instead require the requesting party to post a bond sufficient to pay any ensuing damages for any wrongful issuance of the TRO. Courts will consider a movant鈥檚 inability to pay when ordering the 鈥減ayment鈥 of a bond. Other safeguards or procedures may apply as well, depending on the jurisdiction, remedy, and situation.聽See, e.g.,听, 416 U.S. 600.聽See also聽State Civil Procedure Rules.

Rule 65 of the聽Federal Rules of Civil Procedure聽authorize聽federal courts聽to issue聽temporary restraining orders聽and聽preliminary injunctions.聽Rule 64聽authorizes聽federal courts聽to use any provisional remedy available to state courts in the state in which the聽federal court聽sits.

A major question facing a business enterprise on the brink of involvement in litigation to collect a business debt is whether the debtor has the assets to satisfy a money judgment and whether the assets will be available once a court renders judgment on the business鈥檚 behalf. Provisional remedies are a valuable legal mechanism for helping any business avoid damaging delays, preserve assets, and increase the likelihood of receiving just compensation in many business litigation matters.

The attorneys at 天美传媒& Goldberg in California provide high quality, cost-effective legal services and advice for clients in all aspects of commercial compliance, business litigation, and transactional law. Call us at (818) 888-2220, send an email inquiry to info@glassgoldberg.com or visit us online at glassgoldberg.com to learn more about the firm and to sign up for future newsletters.

 

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