Judge: Curtis A. Kin, Case: 25STCV07234, Date: 2025-04-17 Tentative Ruling
Case Number: 25STCV07234 Hearing Date: April 17, 2025 Dept: 86
MOTION FOR PRELIMINARY INJUNCTION
Date: 4/17/25 (1:30 PM)
Case: Trex Corp Inc. v. Maria T. Salgado, et al. (25STCV07234)
TENTATIVE RULING:
Plaintiff Trex Corp Inc. dba Team Trex’s Motion for a
Preliminary Injunction is DENIED.
I.
BACKGROUND
A.
Factual Background
This action concerns property located at 13302 and 13306
Rosecrans Avenue, Norwalk, CA 90650 (the “Property”) and the competing
foreclosure rights among four lienholders. (Compl. ¶¶ 16-20.) The borrower
2017 Sky LLC took on four loans and secured those obligations with the Property
through the recordation of four deeds of trust. The first deed of trust was
recorded on August 9, 2017, reflecting that 2017 Sky, LLC was obligated in the
amount of $550,000 to defendants Maria T. Salgado, Serafin Salazar Jr., John
Salazar aka Juan Salazar, Carlos Salazar, as well as Joel Esparaza Jr. and
Daniel Esparza as co-successor trustees of the Esparza Family Revocable Trust,
dated December 19, 2007 (collectively “Salazar Defendants”). (Sugano Decl. ¶ 9
& Ex. B.)
On September 7, 2023, a second deed of trust was recorded on
the Property, reflecting 2017 Sky, LLC was obligated in the amount of $650,000
to defendant Son Green Investment, Inc. (Sugano Decl. ¶ 9 & Ex. D.)
On November 27, 2023, a third deed of trust was recorded on the Property,
reflecting 2017 Sky, LLC was obligated in the amount of $350,000 to defendant
Solomon Ko. (Sugano Decl. ¶ 9 & Ex. E.) Lastly, the fourth deed of trust
was recorded on May 8, 2024, reflecting 2017 Sky, LLC was obligated in the amount
of $609,071.28 to plaintiff. (Sugano Decl. ¶¶ 6-8, Ex. A.) When 2017 Sky LLC
defaulted on its obligation under the fourth deed of trust, plaintiff first
recorded a notice of default on September 3, 2024. (Sugano Decl. ¶ 10, Ex. F.)
By September 18, 2024, a prospective purchaser had made an
offer of $2 million to purchase the Property, which 2017 Sky, LLC had accepted
on September 23, 2024. (Sugano Decl. ¶ 11 & Ex. G.) While the
beneficiaries of the second through fourth deeds of trust consented to this
private sale, the beneficiaries of the first deed of trust failed to provide
all their consent, causing the proposed sale to fall through. (Sugano Decl. ¶¶
13-14, 19.) Thereafter, plaintiff was in default on the other deeds of trust.
Consequently, defendant Song Green Investment Inc. recorded a notice of default
on the Property on November 22, 2024. (Sugano Decl. ¶ 15 & Ex. H.)
Similarly, defendant Solomon Ko caused a notice of default to be recorded on
the Property on November 26, 2024. (Sugano Decl. ¶ 16 & Ex. I.)
On December 9, 2024, plaintiff recorded a notice of
trustee’s sale under the fourth deed of trust, with a scheduled sale date of
January 13, 2025, but this sale was ultimately postponed. (Sugano Decl. ¶ 17
& Ex. J.) Thereafter, on February 26, 2025, defendant Son Green Investment,
Inc. recorded a notice of trustee’s sale under the second deed of trust, with a
sale noticed for March 28, 2025. (Sugano Decl. ¶ 18 & Ex. K.)
B.
Procedural Background
On March 13, 2025, plaintiff commenced the instant action,
alleging the one cause of action for intentional interference with prospective
economic advantage against the Salazar Defendants and one cause of action for declaratory
relief against all defendants. On March 27, 2025, the Court granted plaintiff’s
ex parte application for a temporary restraining order and order to show
cause re: preliminary injunction to enjoin defendant Son Green Investent, Inc.
from conducting a trustee’s sale of the Property. The Court set a hearing on
the Order to Show Cause for April 17, 2025, and ordered a briefing schedule.
II.
ANALYSIS
As a preliminary matter, the Court OVERRULES defendant Son
Green Investment, Inc.’s evidentiary objection nos. 1-7 and SUSTAINS
evidentiary objection no. 8 to the declaration of Hiro Sugano.
“[T]he question whether a preliminary injunction should be
granted involves two interrelated factors: (1) the likelihood that the
plaintiff will prevail on the merits, and (2) the relative balance of harms
that is likely to result from the granting or denial of interim injunctive
relief.” (White v. Davis (2003) 30 Cal.4th 528, 554.) However,
before the Court can exercise its discretion and consider the two interrelated
factors, “[T]he applicant must make a prima facie showing of entitlement to
injunctive relief. The applicant must demonstrate a real threat of immediate
and irreparable injury due to the inadequacy of legal remedies.” (Triple A
Machine Shop, Inc. v. State of California (1989) 213 Cal.App.3d 131, 138,
citation omitted.)
“[A]n injunction is an unusual or extraordinary equitable
remedy which will not be granted if the remedy at law (usually damages) will
adequately compensate the injured plaintiff,” and the party seeking injunctive
relief bears the burden to prove its absence. (Department of Fish & Game
v. Anderson-Cottonwood Irrigation Dist. (1992) 8 Cal.App.4th 1554,
1564-65.) “Mere monetary loss is not ordinarily irreparable in the
contemplation of the remedy by injunction. At least, it should not be
considered so in the absence of any averment or showing that the parties
causing the loss are insolvent or in any manner unable to respond in damages.”
(Duvall v. White (1920) 46 Cal.App. 305, 308; cf. CCP § 526(a)(4)
[injunction may be granted “[w]hen pecuniary compensation would not afford
adequate relief” and “[w]here it would be extremely difficult to ascertain the
amount of compensation which would afford adequate relief”].)
Here, plaintiff contends that it would suffer irreparable
harm and that it is likely to succeed on the merits of its complaint. (Mem. at
6-8.) The Court is unpersuaded.
On the issue of irreparable harm, plaintiff asserts that, if
the foreclosure sale were to go forward, there is a risk that, as the most
junior lien holder, it would not be fully repaid from the sales proceeds. (Mem.
at 7; Sugano Decl. ¶ 22.) That concern is insufficient to establish irreparable
harm. Plaintiff’s risk of harm is solely
monetary, for which plaintiff possesses an adequate legal remedy. Moreover,
while a foreclosure sale by a senior lien holder may extinguish plaintiff’s
security interest in the property, the underlying to debt to plaintiff would
still survive to the extent foreclosure sales proceeds are insufficient to
satisfy that debt. Where, as here,
plaintiff could be made whole with an award of damages, a preliminary
injunction is unwarranted. (See Jessen v. Keystone Savings &Loan
Ass’n (1983) 142 Cal.App.3d 454, 458.)
Because plaintiff fails to show irreparable harm due to the
inadequacy of legal remedies, it is unnecessary to evaluate the likelihood that
plaintiff will prevail on the merits or the balance of harms that would result
from the proposed preliminary injunction. Nevertheless, even if plaintiff could
show irreparable harm, it fails to establish that it will likely prevail on the
merits of its claims. For instance, on the first cause of action for
intentional interference with prospective economic advantage, this claim is
only directed at the beneficiaries of the first deed of trust, not to defendant
Son Green Investment, Inc. who is seeking a foreclosure sale. Thus, even if
plaintiff could prevail on that claim, it has no bearing here, because
defendant Son Green Investment, Inc. is not alleged to have engaged in any
wrongful conduct. Furthermore, even with respect to the Salazar Defendants, who
are the beneficiaries of the first deed of trust, plaintiff fails to adduce any
meaningful evidence to suggest their refusal to consent to the proposed sale
was independently wrongful. (Korea
Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1158–59, [“. .
. an act is independently wrongful if it is unlawful, that is, if it is
proscribed by some constitutional, statutory, regulatory, common law, or other
determinable legal standard”; see CACI 2202 [elements of intentional
interference with prospective economic relations claim includes that defendant
engaged in wrongful conduct].)
Similarly, as to plaintiff’s declaratory relief claim, there
are no allegations to suggest that there is a controversy between plaintiff and
defendant Son Green Investment Inc. The allegations in the complaint clearly
show that the controversy was created by the beneficiaries of the first deed of
trust. (Compl. ¶ 45.) Therefore, it has not been shown that defendant Son Green
Investment Inc. is not entitled to carry on with its foreclosure sale. (See
Mitsui Manufacturers Bank. v. Texas Commerce Bank-Forth Worth (1984) 159
Cal.App.3d 1051, 1057-58). Moreover, plaintiff explains neither why it was
entitled to have the proposed sale finalized nor why the other lienholders had
any duty to consent to the proposed sale. There is no contract or oral
agreement to suggest the parties must consent to a proposed sale, and plaintiff
does not cite to a statute or order that would give rise to any obligation. (Brownfield
v. Daniel Freeman Marina Hospital (1989) 208 Cal.App.3d 405, 410.)
In its reply, plaintiff alternatively requests that the
Court continue the hearing on the Order to Show Cause so that plaintiff may conduct
discovery to support its position and provide supplemental briefing. (Reply at
3, citing Salazar v. Eastin (1995) 9 Cal.4th 836, 849– 850; Nakamura
v. Parker (2007) 156 Cal.App.4th 327, 333.) However, plaintiff fails to
articulate the nature of any discovery that it would seek. Furthermore,
plaintiff’s reply fails to rebut defendant Son Green Investment Inc.’s
arguments that plaintiff cannot show irreparable harm or a likelihood of
prevailing on the merits. Thus, there is no good cause for the requested
continuance.
Based on the foregoing, the motion for a preliminary
injunction is DENIED.