Auto Buyline Systems, Inc. vs. GB Auctions, Inc.

Debtors assert here that they were not in fact personally served on either occasion. (See ROAs 181, 183, 205 and 207.) But they have failed to meaningfully respond to the declarations from the server, as reflected in ROAs 229 and 231, providing a physical description of each Debtor and stating the circumstances of the 4/8/26 service. The Motion thus fails to show that the requested relief is warranted here.

Counsel for Creditor is to give notice of this ruling. 6 Auto Buyline Defendant GB Auctions, Inc.’s (“Defendant”) Motion for Stay is Systems, Inc. DENIED. vs. GB Auctions, Inc. The court first notes Defendant failed to provide any statute or code which permits the requested relief and the Motion may be denied solely on that basis.

The issue before the court is whether this action, which is based upon a guaranty (“Guaranty”) between Defendant and plaintiffs Auto Buyline Systems, Inc. and Thomas J. Harmon (“Plaintiffs” together) should proceed before liability has been determined on the underlying Asset Purchase Agreement (“APA”), which Defendant guaranteed by way of the Guaranty. Under the specific terms of the Guaranty, Plaintiffs may seek to recover any damages under the APA at any time regardless of whether liability has been determined on the APA.

“A surety who has assumed liability for payment or performance is liable to the creditor immediately upon the default of the principal, and without demand or notice.” (Ralston-Purina Co. v. Carter (1962) 210 Cal. App. 2d 372, 380; Civ. Code §§ 2787, 2806, 2807.) “In a guaranty of payment the liability was fixed by the failure of the principal debtor to pay at maturity or at the time when payment was guaranteed. It was immaterial whether the debtor could or could not pay the debt.” (Ingalls v. Bell (1941) 43 Cal.

App. 2d 356, 367.) “[R]emedies against the principal debtor must, of course, have been exhausted where the parties so provided in their contract. [Citations.] Under section 2807 of the Civil Code then in effect, a guarantor of payment or of performance was liable to the guarantee immediately upon the default of the principal and without demand or notice. So there was no duty resting on the creditor to exhaust the remedies against the debtor, and mere delay or failure on the part of the creditor to proceed against the principal debtor did not exonerate the guarantor unless the contract of guaranty provided that such action must be taken” [Emphasis added.] (Ibid.) “A guarantor had no right to compel the creditor to avail himself of the remedies against the debtor unless he paid the obligation, in which case he could have compelled the creditor to act by a proceeding in equity.” (Id., at 368.) “An action against a guarantor must be brought specially upon the contract of guaranty itself. [Citations.]