As mentioned by another contributor, your local building department is the rest resource for the final answer to your question.
Thats a difficult question.....if you convert the current garage into living speace, is your Lot size big enough to build another garage? if not, then no......it would be good to Call the City Planning Dept: http://www.cupertino.org/index.aspx?page=237
and ask them what the regulation are for a property needing a garage attached to it...and your question above "hypothetically" as a query....they will clarify best for you! If you can do it, then do it with permits as this will help in future hold value in the property.
Hope this helps, all the best,