Judge: Armen Tamzarian, Case: 21STCV29839, Date: 2023-04-12 Tentative Ruling
Case Number: 21STCV29839 Hearing Date: April 12, 2023 Dept: 52
Tentative Ruling:
Plaintiff/Cross-Defendant Victor Alarcon’s Motion to Strike Defendants/Cross-Complainants
Jorge Torres and Susana Torres’s Memorandum of Costs;
Defendants/Cross-Complainants Jorge Torres and Susana Torres’s Motion to
Determine They Are Prevailing Parties Entitled to Recover Costs
Plaintiff/cross-defendant Victor
Alarcon and defendants/cross-complainants Jorge Torres and Susana Torres filed
dueling motions to determine they are the prevailing parties and strike the
other parties’ memorandum of costs. “[A]
prevailing party is entitled as a matter of right to recover costs in any
action or proceeding.” (CCP §
1032(b).) “ ‘Prevailing party’ includes the party with a net monetary recovery” and
“a defendant as against those plaintiffs who do not recover any relief against
that defendant. If any party recovers other than monetary relief and in
situations other than as specified, the ‘prevailing party’ shall be as
determined by the court, and under those circumstances, the court, in its
discretion, may allow costs or not and, if allowed, may apportion costs between
the parties.” (CCP § 1032(a)(4).)
Summary of Judgment
After court trial, the court found for plaintiff Victor
Alarcon on his first cause of action for quiet title against defendants Epyon,
LLC, Christopher Alarcon, Jorge Torres, and Susana Torres. The judgment ordered that the Torreses “have
no interest, lien, encumbrance or any other interest in the Property.” (Judgment, ¶ 1.d.) The judgment therefore cancelled “the deed of
trust made October 26, 2018 between Epyon LLC … as trustor, First American
Title Insurance Company … as trustee, and Jorge Torres and Susana Torres,
husband and wife, as community property, as beneficiaries.” (Ibid.)
On the other hand, Jorge and Susana Torres prevailed on their
cross-complaint against Victor Alarcon.
The court awarded them $108,274.22 in damages against Victor Alarcon.
Recovery of Costs
Determining who is
entitled to costs requires exercising discretion under Code of Civil Procedure
section 1032(a)(4). Though defendants/cross-complainants Jorge and Susana Torres
were awarded over $108,000 in damages against plaintiff/cross-defendant Victor
Alarcon, he recovered substantial relief “other than monetary relief.” (CCP § 1032(a)(4).) The court did not award Victor Alarcon any
monetary recovery against them.
Plaintiff provides no authority that the equitable remedies of quieting
title and cancelling the deed of trust should be counted as monetary
recovery. Those remedies may be
valuable, but they are not monetary, per se.
This case therefore does “not fall
into any of the four categories of prevailing party set forth in the first
portion of subdivision (a)(4) of section 1032 which defines a prevailing party
who, under the provisions of subdivision (b), can then recover costs as a
matter of right.” (Lincoln v.
Schurgin (1995) 39 Cal.App.4th 100, 105 (Lincoln).) The “court may determine the prevailing party
and in its discretion may choose to allow or not to allow costs.” (Ibid.) In these circumstances, the trial
court may “order[] each side to pay its own costs, even though” one side is
“without question the prevailing part[y].”
(Texas Commerce Bank v. Garamendi (1994) 28 Cal.App.4th
1234, 1249.)
In making this decision, “the trial
court determines whether the party succeeded at a practical level by realizing
its litigation objectives [citation] and the action yielded the primary relief
sought in the case.” (Friends of
Spring Street v. Nevada City (2019) 33 Cal.App.5th 1092, 1104.) Both sides achieved substantially everything
they sought in their affirmative causes of action against one another. As against the Torreses, the complaint’s
primary litigation objective was to quiet title to the subject property. Plaintiff succeeded in quieting title and
cancelling the deed of trust for $350,000.
The cross-complaint’s primary objective was to recover damages from
Victor Alarcon. The Torreses succeeded
in recovering over $108,000 in damages.
On a
practical level, however, plaintiff’s victory is not as great as it appears. The record at trial showed that “Epyon paid
Jorge and Susana [Torres] $2,246.54 per month as the amount allegedly due to
service a fictitious loan,” and “Jorge and Susana then transferred those
payments to Victor, who then returned the money to Epyon.” (Statement of Decision, p. 9.) The Torreses only stopped returning that
money to Victor in September 2021 (id.), after plaintiff filed this
action against them. The Torreses never
received a significant benefit from their status as beneficiaries on the
fictitious deed of trust. As between
plaintiff and the Torreses, the judgment quieting title could be characterized
as merely returning plaintiff to the status quo.
On the other hand, if plaintiff
lost this action against the Torreses, the deed of trust would remain in
effect. If plaintiff succeeded in
quieting title against defendants Epyon, LLC and Christopher Alarcon but not
Jorge and Susana Torres, he would own the property subject to the deed of trust
encumbering it. The Torreses could have
taken advantage of their position as beneficiaries of the deed of trust, though
they did not do so before plaintiff filed this action.
Regardless
of who is the prevailing party under Code of Civil Procedure section
1032(a)(4), the court will exercise its discretion to not allow the moving
parties to recover costs from one another.
That outcome is fair because both sides were largely successful. As in Lincoln, one side won money,
while the other won significant nonmonetary relief. (Lincoln, supra, 39 Cal.App.4th at pp.
105-106 [plaintiff won over $600,000 monetary judgment while
defendant/cross-complaint won on declaratory relief].) Both sides shall bear their own costs against
one another.
Disposition
Plaintiff/cross-defendant
Victor Alarcon’s motion to strike defendants/cross-complainants Jorge Torres
and Susana Torres’s memorandum of costs is granted as to striking the
Torreses’ memorandum of costs.
Defendants/cross-complainants Jorge
Torres and Susana Torres’s motion to determine they are prevailing parties
entitled to recover costs against plaintiff and that plaintiff is not entitled
to costs against them is granted as to striking plaintiff’s memorandum
of costs against them.
Plaintiff/cross-defendant Victor
Alarcon shall not recover his costs from defendants/cross-complainants Jorge
Torres and Susana Torres. Defendants/cross-complainants
Jorge Torres and Susana Torres shall not recover their costs from
plaintiff/cross-defendant Victor Alarcon.