Vitug

Plaintiffs filed a tort action against a receiver in possession of real property without first seeking permission to do so from the court which had appointed the receiver. The receiver was subsequently discharged without notice to plaintiffs and before they had obtained the required permission to sue. Moreover, plaintiffs’ claim was not accounted for in the receiver’s final report and account to the court. The receiver was later dismissed from the lawsuit on the ground that her discharge shielded her from tort claims which arose during the receivership. Two questions present themselves: 1) Was plaintiffs’ claim against the receiver barred by their failure to obtain permission to sue her? 2) If not, was it barred by her later discharge as receiver? We resolve these issues in plaintiffs’ favor and therefore reverse the judgment dismissing the receiver. We also reverse a companion order which denied plaintiffs leave to amend.

Background

On March 22, 1986, a fire occurred in a San Jose apartment complex resulting in the deaths of Connie and Rosario DeVilla. At the time of the fire the property was in foreclosure and a receiver, Diana Griffin, had been appointed by the court…