Judge: Christian R. Gullon, Case: 23PSCV01302, Date: 2025-05-01 Tentative Ruling

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Case Number: 23PSCV01302    Hearing Date: May 1, 2025    Dept: O

Tentative Ruling

DEFENDANT/CROSS-COMPLAINANT HUDSONINSURANCE COMPANY'S MOTION TO DEPOSIT BY STAKEHOLDER; REQUESTI'ORATTORNEY'S I'EKS PURSUANT TO CCP SECTION 386.6 is DENIED; this is not an interpleader action.

Background

This case arises from a home improvement. Plaintiff DENISE McCREARY alleges the following against Defendants DROR (DEAN) ELHANANI (“Elhanani”) and VISION CONSTRUCTION (“Vision”) (collectively, “Defendants”); AMERICAN CONTRACTORS INDEMNITY COMPANY (“American Contractors”): In 2019, Plaintiff entered into a contract with Elhanani and Vision for renovations on her home. Despite paying 70% of the total contract price, Elhanani and Vision tore up Plaintiff’s home and have since abandoned the project. The bonding company, American Contractors, has refused to either complete the job or compensate Plaintiff.

On May 1, 2023, Plaintiff filed suit for:

1.     Unlawful business practices (as to Elhanani and Vision)

2.     Common counts (as to Elhanani and Vision)

3.     Breach of contract, (against all) and

4.     Elder abuse (against all)

On May 4, 2023, Plaintiff filed an amendment to complaint indicating that Hudson Insurance Company (“Hudson”) is the true name of defendant American Contractors.[1]

On June 2, 2023, Hudson filed the instant demurrer with a motion to strike.[2]

On August 9, 2023, Plaintiff filed its opposition.

On August 9, 2023, the court clerk entered default against Elhanani.

On August 15, 2023, the court clerk entered default against Vision.

On November 29, 2023, the court set aside the defaults (upon motion).

On September 26, 2024, the parties attended an MSC, which did not settle the matter.

On March 25, 2025, the instant motion was filed.

On April 16, 2025, Plaintiff filed an opposition.

On April 24, 2025, Hudson filed its reply.

On April 25, 2025, Plaintiff filed a Request For Additional Briefing Regarding Opposition To Interpleader.

Legal Standard

Hudson brings forth the motion pursuant to California Code of  Civil Procedure ("CCP") 386(b) which in turn provides:

Any person, firm, corporation, association or other entity against whom double or multiple claims are made, or may be made, by two or more persons which are such that they may give rise to double or multiple liability, may bring an action against the claimants to compel them to interplead and litigate their several claims. The action of interpleader may be maintained although the claims have not a common origin, are not identical but are adverse to and independent of one another, or the claims are unliquidated and no liability on the part of the party bringing the action or filing the cross-complaint has arisen.

The purpose of the statute is to prevent a multiplicity of suits. But an interpleader action may not be maintained upon the mere pretext of suspicion of double vexation; the plaintiff must allege facts showing a reasonable probability of double vexation or a valid threat thereof. (Westamerica Bank v. City of Berkeley (2011) 201 Cal.App.4th 598. In sum, interpleader is proper if any of the money held is subject to conflicting demands from others.

Discussion

The court’s ruling will be rather brief as the court agrees with Plaintiff that there are no competing claims. Either Hudson pays the amount of the bond to Plaintiff OR they keep it themselves; Defendants are not entitled to say a reimbursement of the bond amount, regardless if Defendants have not authorized payment.

To the extent that there is a factual dispute as to whether or not the amount of the bond is $15,000.00 or $25,000.00, which turns on when Defendants abandoned the project within the meaning of business and Professions Code 7107, that argument fails for a few reasons.[3]

First, having found that this is not an interpleader action, that argument is moot.

Second, assuming otherwise, Plaintiff’s request for supplemental briefing provides Hudson’s response in FROG 16.1. There, Hudson responded that “Defendant is not making any contention that any of the property damage claimed by Plaintiff in discovery proceedings this far in this case [approx. $100,000.00] was not caused thy the INCIDENT. (INCIDENT means the 2023 ‘job abandonment’ by VISION CONSTRUCTION which is a covered event.” (Supp. Opp. p. 1.) Accordingly, it appears Hudson itself acknowledges that the abandonment/violation occurred in 2023 to warrant the $25,000 bond.

Third, assuming otherwise, Defendants last day working on the project was November 21, 2022. But there is no affirmative evidence otherwise that Defendants stated they would not return. In fact, according to Hudson’s reply, Defendants failed to cure the abandonment despite receiving a Notice of Violation and Demand for Remedy served in February 2023; thus, there may have been a chance in the interim that they would resume work or cure any abandonment within 30 days of the notice. (Civil Code §1784.)

To the extent that Hudson relies upon Karton v. Ari Design & Construction, Inc. (2021) 61 Cal.App.5th 734 in both its motion and reply to support this action, that case did not involve an interpleader action.

All in all, there are no conflicting claims to the bond. Instead, as noted by Plaintiff, the relief sought is perhaps more appropriate under a declaratory relief claim. (Id. at p. 753 [“After receiving our tentative ruling, Wesco attempted during oral argument to launch a new argument about interpleader. Wesco's failure to brief its interpleader argument forfeited it.”].)

Conclusion

Based on the foregoing, the motion is DENIED.