Judge: Christopher K. Lui, Case: 19STCV27100, Date: 2023-03-01 Tentative Ruling

Case Number: 19STCV27100    Hearing Date: March 1, 2023    Dept: 76

Pursuant to California Rule of Court 3.1308(a)(1), the Court does not desire oral argument on the motion addressed herein.  As required by Rule 3.1308(a)(2), any party seeking oral argument must notify ALL OTHER PARTIES and the staff of Department 76 of their intent to appear and argue.  Notice to Department 76 may be sent by email to smcdept76@lacourt.org or telephonically at 213-830-0776.  If notice of intention to appear is not given and the parties do not appear, the Court will adopt the tentative ruling as the final ruling.

            Plaintiff alleges that he had an agreement with Defendants, his parents, that property would be purchased and held jointly in Plaintiffs and Defendants’ name, but Plaintiff would make all mortgage, insurance, utility and tax payments and live in the house, which would be Plaintiff’s. However, Defendants eventually lost their house and moved into Plaintiff’s house to live with Plaintiff and his wife. Eventually, Defendants made so life difficult for Plaintiff and his wife that they moved out to live elsewhere. Plaintiff now seeks to quiet title in his name and to recover possession of the property or, alternatively, for partition of the property.

            Defendants filed a Cross-Complaint alleging that Plaintiff/Cross-Defendant did not fulfill the conditions to require Cross-Complainants to convey their interest in the property to Plaintiff/Cross-Defendant. In particular Plaintiff/Cross-Defendant failed to pay all mortgage, interest, real property taxes, insurance and utility payments, but only made some of the mortgage payments, but not payments for real property taxes and only some utility payments. Nor did Plaintiff/Cross-Complainant undertake the agreed-upon improvements or maintenance of the property. Cross-Complainants allege that they agreed with Cross-Defendant that the agreement to convey their interest to Cross-Defendant was off, and Cross-Defendant would deed whatever interest he had to the property to Cross-Complainants. Cross-Complainants thereafter accepted an offer to purchase the real property, but the sale fell through after a lis pendens was recorded against the property.

            On October 13, 2022, the Court issued a Statement of Decision whereby the Court made various findings. On December 20, 2022, the Court entered judgment.

            Defendants/Cross-Complainants move to set aside and vacate judgment and enter another and different judgment pursuant to CCP §§ 663, 663a.

TENTATIVE RULING

Defendants/Cross-Complainants Thomas Roberto and Virginia Lynne Roberto’s motion to set aside and vacate judgment and enter another and different judgment pursuant to CCP §§ 663, 663a is DENIED.

ANALYSIS

Motion To Vacate Judgment and To Enter Another and Different Judgment

            Defendants/Cross-Complainants move to set aside and vacate judgment and enter another and different judgment pursuant to CCP §§ 663, 663a, as follows: “That judgment be entered in favor of defendants THOMAS ROBERTO AND VIRGINIA LYNNE ROBERTO on all causes of action in plaintiff’s first amended complaint and that plaintiff MICHAEL ROBERTO takes nothing.” 

            CCP § 663(1) provides:

A judgment or decree, when based upon a decision by the court, or the special verdict of a jury, may, upon motion of the party aggrieved, be set aside and vacated by the same court, and another and different judgment entered, for either of the following causes, materially affecting the substantial rights of the party and entitling the party to a different judgment:

1. Incorrect or erroneous legal basis for the decision, not consistent with or not supported by the facts; and in such case when the judgment is set aside, the statement of decision shall be amended and corrected.

     (Civ. Proc. Code § 663(1).)

            CCP § 663a(a)(1) & (2) provides:

(a) A party intending to make a motion to set aside and vacate a judgment, as described in Section 663, shall file with the clerk and serve upon the adverse party a notice of his or her intention, designating the grounds upon which the motion will be made, and specifying the particulars in which the legal basis for the decision is not consistent with or supported by the facts, or in which the judgment or decree is not consistent with the special verdict, either:

(1) After the decision is rendered and before the entry of judgment.

(2) Within 15 days of the date of mailing of notice of entry of judgment by the clerk of the court pursuant to Section 664.5, or service upon him or her by any party of written notice of entry of judgment, or within 180 days after the entry of judgment, whichever is earliest.

Here, the clerk mailed notice of entry of judgment on December 20, 2022. The notice of this motion was filed on January 4, 2023, which is the 15^th day after the mailing of the notice of entry of judgment by the clerk. As such, this motion is timely. 

            On October 13, 2022, the Court issued a Statement of Decision whereby the Court made the following findings:

            As to the Complaint, the Court found in favor of Defendants on the first, second, third, sixth and eighth causes of action because they are remedies, not independently cognizable claims. (Statement of Decision, Pages 3 – 6.)

            Plaintiff’s fourth cause of action for declaratory relief and to quiet title fails. (Statement of Decision, Page 9.)

            The Court found in favor of Defendants on the fifth cause of action for ouster. (Statement of Decision, Page 9.)

            The Court found in favor o Defendants on the seventh cause of action for partition.

            The Court found in favor of Plaintiff on the ninth cause of action for accounting and ordered that Plaintiff may recover the monies he expended for mortgage payments in the amount of $182,122.95 and insurance payments in the amount of $7,256.92. (Statement of Decision, Pages 10 – 11.)

            As to the Cross-Complaint, the Court found that a declaratory judgment was unnecessary and found in favor of Cross-Defendant on the breach of contract claim. (Statement of Decision, Pages 11 – 12.)

The Court addresses Defendants’ arguments as set forth in the notice of motion[1]: 

1. The Court’s factual findings in its Statement of Decision do not support an award of $189,379.87 in damages to the plaintiff under the plaintiff’s Ninth Cause of Action for an Accounting, or any cause of action; moreover, since this judgment represents $182,122.95 in mortgage payments and $7,256.92 in insurance payments allegedly made by the plaintiff, the plaintiff is not entitled to recover these sums since he failed to sue for the return of mortgage payments or insurance payments in his first amended complaint;

As this Court noted in its tentative ruling awarding Plaintiff prejudgment interest, in the ninth cause of action, Plaintiff requested the following alternative relief at ¶ 56 of the 1AC: 

56. If the Court does not find that the Plaintiff holds all interests in the title to the

Property, but that the defendants hold an interest in it, then Plaintiff asks the Court to determine the amount which is owed to him from the defendants, and which should also be impressed as an equitable lien against the Property, for the defendants' share of the expenses and costs which Plaintiff has paid for the Property and which has benefitted the defendants as co-owners.

The 1AC alleges at ¶ 11 that Plaintiff paid all mortgage payments, insurance and maintenance payments for the property. As such, Defendants’ argument on this point is inaccurate and is not persuasive. 

2. The Court’s Statement of Decision does not support a finding that plaintiff would suffer a forfeiture if he were not awarded the sum of $189,379.87; and/or,

            Defendants argue that relief from forfeiture is not available to Plaintiff because his actions were willful and fraudulent in failing to pay all mortgage payments, any of the real property taxes and failing to pay utilities. Defendant argues that Plaintiff may not be relieved of a forfeiture in case of a grossly negligent, willful, or fraudulent breach of duty. (Civil Code, § 3275.)

Whenever, by the terms of an obligation, a party thereto incurs a forfeiture, or a loss in the nature of a forfeiture, by reason of his failure to comply with its provisions, he may be relieved therefrom, upon making full compensation to the other party, except in case of a grossly negligent, willful, or fraudulent breach of duty.

(Civ. Code § 3275.)

            As Plaintiff argues, there was insufficient evidence that Plaintiff was grossly negligent, willful or fraudulent in breaching a duty to Defendants in failing to pay all mortgage payments, any of the real property taxes and failing to pay utilities.

            The Court was justified in finding that Plaintiff’s financial contribution would be forfeited in the absence of equitable relief, because Plaintiff would not receive any ownership interest in the property—and thus share in the significant appreciation in property value—despite having made mortgage and insurance payments. (Statement of Decision, Page 11.) The Court also found that Plaintiff’s use of the property during the eight years he lived there, and the varying amounts of rental income Plaintiff received, did not justify an offset. (Id.)

            This argument is not persuasive. 

3. This Court found in its Statement of Decision that the plaintiff failed to plead breach of contract in his first amended complaint and found that none of the plaintiff’s “allegations (either alone or together) [were] sufficient to satisfy the basic elements of contract formation,….” Nevertheless, this Court awarded the plaintiff prejudgment interest under Civil Code, section Civ. Code, § 3287, subd. (b), which only allows for prejudgment interest for a party who was awarded damages “based upon a cause of action in contract.”

            The Court relied upon Civil Code, § 3287(a)[2], which is not limited to a cause of action on contract, and also the Court’s equitable discretion to award prejudgment interest, not § 3287(b). This argument is not persuasive.