Employment Development Department v. Union Bank

The present appeal concerns the timeliness of appellants’

third party claim to funds levied upon by the Employment Development Department of the State of California. For reasons discussed herein, we agree with the trial court’s determination that the third party claim was barred as untimely.

In January of 1981, appellants Beltz and Aviles sold their business to James W. and Kangja Greer (hereafter referred to as Debtors). Debtors’ installment note was secured by a security interest in the assets of the *544 business, including bank accounts, contracts and accounts receivable. A UCC-1 financing statement referring to the security interest was filed with the Secretary of State on March 26, 1981. On July 1, 1981, Debtors incorporated the business under the name of GSP Security, Inc.

On July 14, 1982, Employment Development Department (hereafter referred to as EDD) served a notice of levy for delinquent state employment taxes on the bank where the account of GSP Security, Inc. was located. On July 23, 1982, EDD served a notice of levy on Mt. Diablo Unified School District for an account receivable of GSP Security, Inc. On July 22 and August 16, 1982, the proceeds from the…