Grayson Services, Inc. v. Wells Fargo Bank

INTRODUCTION

Based on a default judgment, a judgment creditor served a writ of execution and notice of levy on Wells Fargo Bank (Wells Fargo) in an *566 attempt to obtain two certificates of deposit and related interest payments that the judgment creditor believed were the property of its judgment debtor. The certificates of deposit in question were in the possession of, and made payable to, a public entity. The accrued interest had been delivered to a creditor with a competing levy. Consequently, Wells Fargo’s memorandum of garnishee stated it had nothing to report and no certificates or funds were delivered in response to the levy. A second writ of execution and levy were served on Wells Fargo, with essentially the same response.

The judgment creditor sued Wells Fargo in a separate action alleging (1) the bank’s response to the levies violated its duties under California’s Enforcement of Judgments Law (EJL) 1 and (2) the bank conspired with its customer and others to fraudulently transfer assets and hinder the judgment creditor’s attempts to levy on those assets.

The trial court eliminated both claims at the pleading stage. First, the court sustained a demurrer to…