## Facts

- Korea First Bank (KFB) made a loan of about $9.6 million; petitioners executed a promissory note secured by a deed of trust on California real property.
- Petitioners defaulted on interest payments beginning August 15, 1991; KFB accelerated the note and demanded payment of principal, interest, and charges.
- Before filing in California, KFB filed suit in Korea on the same debt and obtained a prejudgment attachment that created and maintained a lien on Shin’s Korean real property.
- KFB then filed a California action seeking judicial foreclosure of the deed of trust and a deficiency judgment.
- The superior court granted KFB unopposed summary adjudication on its right to foreclose and obtain a deficiency, and later reaffirmed that ruling on reconsideration, holding the Korean attachment did not violate Code of Civil Procedure § 726(a).
- Petitioners sought writ relief to vacate the summary adjudication and to enforce § 726(a)’s sanction for an impermissible “second action.”

## Issues

1. Whether a creditor’s foreign prejudgment attachment against a debtor’s other real property, based on the same debt secured by a California deed of trust, is an “action” that violates Code of Civil Procedure § 726(a).
2. If § 726(a) is violated, what sanction applies to the creditor’s California judicial foreclosure and deficiency claims.

## Decision

- The Court of Appeal granted the petition for writ of mandate.
- The court held that KFB’s Korean prejudgment attachment proceeding was an “action” within the meaning of § 726(a).
- By obtaining and maintaining that attachment on the same secured debt while pursuing California foreclosure, KFB violated § 726(a)’s one-action rule.
- The court directed the superior court to vacate the order granting summary adjudication for KFB and to enter an order applying § 726(a) sanctions barring further enforcement of the California deed of trust in that action (including judicial foreclosure and deficiency relief).

## Legal Principles

- Code of Civil Procedure § 726(a) limits a creditor to a single form of action for recovery of a debt secured by real property; the permitted action is foreclosure that exhausts the security before personal recovery.
- The one-action rule applies broadly to proceedings by the beneficiary to recover the secured debt or enforce rights arising from the secured obligation, and violations may trigger forfeiture-type sanctions affecting the creditor’s security rights.
- A prejudgment attachment that creates and maintains a lien on other property to secure payment of the same deed-of-trust debt constitutes sufficiently coercive enforcement activity to be treated as an “action” under § 726(a), even without a final money judgment.
- The rule is not avoided merely because the enforcement step occurs in a foreign forum; when the creditor seeks relief in California on a California-secured transaction, § 726(a) can bar foreclosure and deficiency remedies if the creditor first pursued other enforcement for the same debt.

## Conclusion

A secured creditor that sues abroad on the same obligation and obtains a continuing prejudgment attachment on the debtor’s other real property commits an “action” under Code of Civil Procedure § 726(a), and the resulting violation bars the creditor from proceeding with California judicial foreclosure and any deficiency recovery on the deed-of-trust debt.


Shin v. Superior Court, 26 Cal. App. 4th 542 (Cal. Ct. App. 1994)