Judge: Anne Richardson, Case: 23STCV26012, Date: 2024-08-09 Tentative Ruling

DEPARTMENT 40 - JUDGE ANNE RICHARDSON - LAW AND MOTION RULINGS
The Court issues tentative rulings on certain motions.The tentative ruling will not become the final ruling until the hearing [see CRC 3.1308(a)(2)]. If the parties wish to submit on the tentative ruling and avoid a court appearance, all counsel must agree and choose which counsel will give notice. That counsel must 1) email Dept 40 by 8:30 a.m. on the day of the hearing (smcdept40@lacourt.org) with a copy to the other party(ies) and state that all parties will submit on the tentative ruling, and 2) serve notice of the ruling on all parties. If any party declines to submit on the tentative ruling, then no email is necessary and all parties should appear at the hearing in person or by Court Call. 

Case Number: 23STCV26012    Hearing Date: August 9, 2024    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

Background[1]

Plaintiff Sonia Feldman (“Plaintiff”) commenced this action by filing her Complaint on October 24, 2023, against Mark Sawyer dba MAS Financing (“Sawyer”), Gaelen Patrick Whittemore aka Ben Whittemore (“Gaelen”), Sonja Domino Powell aka Domino Whittemore and aka Sonja Domino Whittemore (“Domino”), and the DND Family Trust (“DND”).[2] The Complaint alleges causes of action for (1) breach of contract – both written and oral; (2) open book account and account stated; (3) fraud; (4) conversion; (5) unjust enrichment; and (6) unfair competition. The Complaint alleges in pertinent part as follows:

Gaelen, Plaintiff’s mentor and teacher in the music industry, introduced her to Sawyer. Gaelen and his wife Domino explained to Plaintiff that their friend Sawyer was a “financial genius” who could help Plaintiff recover the financial losses she had incurred from prior, dishonest individuals in the music business. Plaintiff admits that she was naïve in trusting these individuals. She was only 23 years old when both of her parents had passed away, leaving her with over two million dollars in inheritance.

The Whittemores told Plaintiff that Sawyer could help Plaintiff regain the millions of dollars she had lost. They asserted that Sawyer was making a fortune with bridge loans earning interest of up to 19% over a 90-day period. Sawyer would use Plaintiff’s money to make bridge loans that would earn high interest.

When Plaintiff and Sawyer talked over the phone, Sawyer made the same promise as the Whittemores. Sawyer asserted that he would take the money people like Plaintiff invested with him, use it to make bridge loans to those in dire need of money, and use the profits from those loans to repay the investors with interest, ranging from 11.6% to 16% over a 90-days period, or 76% annually. Sawyer backed the promise to repay with signed promissory notes.

On January 29, 2021, Plaintiff initiated a $10,000 loan to Sawyer for the purpose of making an investment through Sawyer’s “bridge loan program.” Sawyer signed and executed a promissory note, drafted by Domino, whereby Sawyer promised to pay Plaintiff back within 95 days. In exchange for value received, the promissory note provided that “on or before May 4, 2021 and without further notice, demand, or invoice from [Plaintiff], sawyer shall pay [Plaintiff] the fixed sum of $11,600.”

The Whittemores has explained to Plaintiff that by “rolling the notes over and over,” Plaintiff would be able to make back the millions she had lost. After the January promissory note was executed, Plaintiff did not exercise her option to have Sawyer pay her $11,600. Instead, on May 21, 2021, Plaintiff chose to “roll it over” into a new promissory note under which Plaintiff would be repaid $12,992 by August 26, 2021. Defendants had emphasized to Plaintiff that was how she would make more money.

Plaintiff was so enraptured by Defendants that she opted to sell her home so she could invest the $1,166,337.13 proceeds in the program. On April 30, 2021, Plaintiff invested these proceeds with Sawyer, who signed a promissory note with the same terms and 95-day turnaround as the January promissory note. Plaintiff chose to roll over the $1,387,941.18 promised under this April promissory note into a new promissory note on August 20, 2021. Under this promissory note, Sawyer promised to pay Plaintiff $1,554,235.30 on November 20, 2021.

Defendants knew that Plaintiff would never see the $1,176,337.13 she had transferred to Sawyer because they would keep convincing her to roll over the proceeds. Plaintiff continued to invest for approximately two years.

In a promissory note dated February 17, 2023, Sawyer promised to repay Plaintiff $24,740.24 on May 22, 2023. This was the last promissory note in the series of rollovers from the $10,000 invested in January 2021. On March 10, 2023, Plaintiff and Sawyer signed one last promissory note in which Sawyer promised to repay $2,812,595 on June 10, 2023.

In the summer of 2023, Plaintiff requested repayment of $200,000. She was told that such a sum could not be withdrawn from Sawyer’s bank account at any one time because Sawyer had mistakenly made a deal with money-launderers.

            After more time lapsed, and Plaintiff had made more inquiries without avail, Plaintiff demanded to pull all her money out of the program. Defendants did not return Plaintiff’s investment. A demand letter was sent to Sawyer to no effect.

            Defendants have not used Plaintiff’s money to make bridge loans. They used it for personal matters and planned to indefinitely lie to Plaintiff about her investment funds.

Procedural History

On December 5, 2023, the Whittemores filed separate Answers.

On December 8, 2023, Plaintiff served Sawyer with the Complaint and Summons.

On January 24, 2024, this Court rejected Plaintiff’s request for entry of default against Sawyer.

On February 6, 2024, this Court entered default against Sawyer.

On February 8, 2024, pursuant to Plaintiff’s request, this Court dismissed the entire action against DND.

On February 13, 2024, the parties stipulated to set aside Sawyer’s default.

On February 20, 2024, Department 85 denied Plaintiff’s ex parte application for a right to attach order against Sawyer but granted a temporary protective order (“TPO”) and scheduled a hearing.

On February 23, 2024, Plaintiff filed an undertaking by posting a bond of $10,000.

On March 28, 2024, Department 85 issued a right to attach order in the amount of $2,837,333.38 against Sawyer.

On July 18, 2024, Plaintiff dismissed the action against the Whittemore defendants only.

Motion Before the Court

On May 2, 2024, Plaintiff filed her Motion for Summary Adjudication against Sawyer on the first and second causes of action in her Complaint and as to each of Sawyer’s affirmative defenses on the following grounds.

ISSUE 1: There are no triable issues as to any material fact that Defendant Sawyer has breached the Written Agreements dated February 17, 2023 and March 10, 2023, and as a result Plaintiff is entitled to an adjudication on the issue of breach of written contract in her favor, as a matter of law.

ISSUE 2: There are no triable issues as to any material fact that Defendant Sawyer breached the Oral Agreement to pay her of $3,149,689.67, and as a result, Plaintiff is entitled to an adjudication on the issue of breach of oral contract, in her favor as a matter of law.

ISSUE 3: There are no triable issues as to any material fact that there was an account stated in writing that Defendant Sawyer owes Plaintiff of $3,149,689.67, and he has failed to pay it. As a result, Plaintiff is entitled to an adjudication on the issue of account stated, in her favor as a matter of law.

ISSUE 4: There are no triable issues as to any material fact that there was an open book account pursuant to which it shows that Defendant owes Plaintiff $3,149,689.67, and he has failed to pay it. As a result, Plaintiff is entitled to an adjudication on the issue of open book account, in her favor as a matter of law.

ISSUE 5: There are no triable issues as to any material fact as to each of Defendant Sawyer’s affirmative defenses, and Plaintiff is entitled to summary adjudication on these issues as a matter of law.

No opposition to the Motion has been filed as of August 7, 2024.

After review, the Court GRANTS the Motion.

Judicial Notice

None.

Evidentiary Objections

None.

Motion for Summary Adjudication

The function of a motion for summary judgment or adjudication is to allow a determination as to whether an opposing party cannot show evidentiary support for a pleading or claim and to enable an order of summary dismissal without the need for trial. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) In analyzing motions for summary judgment, courts must apply a three-step analysis: “(1) identify the issues framed by the pleadings; (2) determine whether the moving party has negated the opponent's claims; and (3) determine whether the opposition has demonstrated the existence of a triable, material factual issue.” (Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 294.) Thus, summary judgment is granted when, after the Court’s consideration of the evidence set forth in the papers and all reasonable inferences accordingly, no triable issues of fact exist and the moving party is entitled to judgment as a matter of law.  (Code Civ. Proc. § 437c(c); Villa v. McFarren (1995) 35 Cal.App.4th 733, 741.)

Plaintiff contends she is entitled to summary adjudication on the first two causes of action in her Complaint against Sawyer and as to each of his affirmative defenses.[3]  

Breach of Contract

“[T]he elements of a cause of action for breach of contract are (1) the existence of the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to the plaintiff.” (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.)

Here, the promissory note dated February 17, 2023 provides for a payment due date of May 22, 2023. (Feldman Decl., Ex. F.) The promissory noted identifies the Borrower as “Mark A. Sawyer” and the Lender as “Sonia Feldman.” (Feldman Decl., Ex. F.) The “Total Amount Due of Payment Due Date is $24,740.24.” (Id.) Any portion of the $24,740.24 not paid in full shall accrue late charges at the rate of 10% per annum until paid. (Id.) The promissory note dated March 10, 2023, provides for a payment due date on June 10, 2023. (Feldman Decl., Ex. E.) The contract identifies the Borrower as “Mark A. Sawyer” and the Lender as “Sonia Feldman.” (Id.) The “Total Amount Due on Payment Due Date is $2,812,595.14.” (Id.) Any portion of the $2,812,595.14 not paid in full shall accrue late charges at the rate of 10% per annum until paid. (Id.) As both dates have passed and Plaintiff has not yet received payment, both promissory notes are in breach. (Feldman Decl., ¶23.) Further, defendants encouraged Plaintiff to keep rolling over the promissory notes, one term after another. (Feldman Decl. ¶¶ 4, 9, 12-14, Exs. H-I.) The parties agreed that Plaintiff is owed $3,149,689.67. (Feldman Decl. ¶¶16 – 21, 24-26, Exs. J-K; Machat Decl. ¶¶ 14 – 23, Exs. O-U.) Sawyer has not paid Plaintiff the $3,149,689.67. (Feldman Decl. ¶23.)

Based on the foregoing, Plaintiff has satisfied her initial burden of showing there is no defense to the first cause of action for breach of contract by proving each element of the claim. The burden shifts to defendant to present a triable issue of material fact. Sawyer offers no opposition to the motion and, as such, has not presented evidence to raise a triable issue of material fact. Plaintiff is therefore entitled to entitled to summary adjudication against Sawyer on issue #1 for breach of written contract in the amount of $2,837,335.38 and issue #2 for breach of oral contract in the amount of $3,149,689.67.

Open Book Account and Account Stated

To establish an open book account claim, a plaintiff must establish (1) that the parties had financial transactions, (2) that plaintiff kept an account of the debits and credits involved in the transactions, (3) that defendant owes plaintiff money on the account, and (4) the amount of money that defendant owes plaintiff. (CACI 372.) 

“An account stated is ‘an agreement, based on prior transactions between the parties, that the items of an account are true and that the balance struck is due and owing.’” (Professional Collection Consultants v. Lauron (2017) 8 Cal.App.5th 958, 968 (quoting Maggio, Inc. v. Neal (1987) 196 Cal.App.3d 745, 752).) 

Here, the parties had financial transactions as provided above. Defendants kept

book accounts of the amounts owing to each investor of Sawyer’s bridge loan program, including the amount of money owed to Plaintiff. (Machat Decl. ¶ 22; Ex. R.) The parties agreed that $3,149,689.67 is owed by Sawyer to Plaintiff. (Machat Decl. ¶¶ 14 – 23, Exs. O-U; Feldman Decl. ¶¶ 16 – 21, and 24- 26, Exs. J-K.) Sawyer has not paid Plaintiff the $3,149,689.67 due and owing. (Feldman Decl. ¶23.)

Accordingly, Plaintiff has satisfied her initial burden of showing there is no defense to the claims for open book account and account stated. The burden is shifted to Sawyer to provide evidence that demonstrates that a question of fact exists with regards to any of the elements. As Sawyer presented no opposition and no evidence, Plaintiff is entitled to summary adjudication against Sawyer on issue #3 on account stated and issue #4 on open book account.

            Affirmative Defenses

The Court finds that no triable issues of material fact exists as to each affirmative defense put forth by Sawyer. Sawyer provides no evidence disputing that he owes Plaintiff $3,149,689.67 and that he has not paid Plaintiff this amount. Sawyer’s defenses are boilerplate or irrelevant. Plaintiff is entitled to summary adjudication on issue #5. 

Conclusion

Plaintiff Sonia Feldman’s Motion for Summary Adjudication against Defendant Anthony Sawyer is GRANTED.