System Investment Corp. v. Union Bank

In the trial court, two actions (No. 902126 and No. 908237) were consolidated for trial, and it was stipulated that they might be consolidated for purposes of appeal. In substance, the actions arose from agreements and conduct relating to financing by the Union Bank of the construction by Leon Omansky (and subsequently by System Investment Corporation, which was the alter ego of Truitt Matthew Stewart) of an apartment building at 505 Lafayette Park Place, Los Angeles, on property owned by Stewart. The California Bank was conservator of the estate of Stewart during a period while he was unable to manage his affairs by reason of a heart attack. In action No. 902126, plaintiffs System and California Bank sought (1) declaratory relief with reference to two notes (a note for $975,000 secured by deed of trust, and a note for $165,000) made by Omansky (and his wife, Bertha) payable to the Union Bank, (2) a decree setting aside a sale of the property under the deed of trust, and (3) an accounting between the parties. In action No. 908237, plaintiff Union Bank sought recovery from Omansky on the note for $165,000, recovery of $100,000 from Stewart, as guarantor of indebtedness…