Judge: David A. Hoffer, Case: 30-2021-1203308, Date: 2022-11-21 Tentative Ruling
The Motion for Summary Judgment by plaintiff Fidelity National Insurance Company (“plaintiff”) against defendants Francois Badeau and Pamela Badeau (“defendants”) is GRANTED with judgment to be entered in favor of plaintiff and against defendants in the amount of $190,000 plus costs and interest as available by law.
“The party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.)
Plaintiff is a title insurance company that issued a policy of title insurance to the Millers in connection with their purchase of the subject Carnation property in 2008. At the time of issuing the policy, plaintiff erred and did not address the existence of the Wells Fargo home equity line of credit deed of trust (HELOC DOT) that had encumbered the property since 2002. At the time the title policy was issued, there was apparently a zero balance on the HELOC. Between 9/21/09 and 2/26/18, defendants took monetary advances of over $250,000 on the HELOC, even though they no longer owned the property. (UMF 10) Thereafter, the defendants stopped making payments. On 6/21/18, Wells Fargo contacted Fidelity, as the Miller’s insurer, and requested full payment on the HELOC DOT. (UMF 12) Fidelity hired counsel who attempted to get the defendants to pay their obligation under the HELOC, but defendants refused. (UMFs 14, 15) Ultimately, Fidelity had no option but to pay Wells Fargo $190,000 to obtain a reconveyance (recorded on 6/8/20). (UMFs 16, 17) The entirety of the $190,000 was applied by Wells Fargo to pay down the defendants’ indebtedness. (Nygaard Decl. at ¶19, Exh. N-13) Plaintiffs subsequently filed a complaint with a single cause of action for restitution based on unjust enrichment.
“The elements of a claim of unjust enrichment are “receipt of a benefit and unjust retention of the benefit at the expense of another.” (Lectrodryer v. SeoulBank (2000) 77 Cal.App.4th 723, 726, 91 Cal.Rptr.2d 881.) “The theory of unjust enrichment requires one who acquires a benefit which may not justly be retained, to return either the thing or its equivalent to the aggrieved party so as not to be unjustly enriched.” (Otworth v. Southern Pac. Transportation Co. (1985) 166 Cal.App.3d 452, 460).
Plaintiffs met their burden of establishing the elements by admissible evidence. The defendants received a benefit in the form of $190,000 being paid toward a debt they owed to Wells Fargo as secured by a DOT that should have been terminated at the time of the sale to the Millers. The fact is that Plaintiff made a mistake when it issued the policy, and the defendants capitalized on the mistake by withdrawing funds against the HELOC that was secured by a property they no longer owned. The Court finds that it would be patently unfair and unjust to allow the defendants to retain the benefit of the $190,000 at the expense of the plaintiff.
The plaintiff having met its burden, the burden shifts to the defendants to show, by reference to specific facts, the existence of a triable issue of material fact. (Villacres v. ABM Industries, Inc. (2010) 189 Cal.App4th 562, 575.) “There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Aguilar, supra, at p. 850.) To meet this burden, the opposing party must present substantial and admissible evidence creating a triable issue. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 163.) Theoretical, imaginative, or speculative submissions are insufficient to stave off summary judgment. (Dollinger DeAnza Associates v. Chicago Title Ins. Co. (2011) 199 Cal.App.4th 1132, 1144-1145; Doe v. Salesian Society (2008) 159 Cal.App.4th 474, 481).
The defendants fail to meet their burden. The defendants attack the motion by contesting the “undisputed material facts” submitted by the plaintiffs and then submit additional “facts” which defendants claim are disputed. The Court has considered each of the facts submitted by plaintiff and has determined that they are not effectively disputed by the defendants. For example, defendants dispute UMF 1 because the words “del mar” is left off of the city name (Corona Del Mar) in which the Carnation property is located, yet this scrivener’s error is neither a legitimate dispute nor a material fact. The alleged dispute as to UMFs 6 and 10 are based on a single page of a credit report and an internal document from Fidelity (both of which are hearsay) and, more fundamentally, do not dispute the admitted fact that Defendants did not instruct Wells Fargo to terminate the HELOC and that they continued to take advances against the HELOC. Defendants’ attempt to dispute UMF 12 is a mischaracterization of what the 6/21/18 letter states. Defendants’ attempt to dispute UMFs 13, 14, 15, 16, 17 & 19 do not actually refute the facts asserted.
Defendants also submit their own list of additional facts. These “facts” do not meet Defendants’ burden in opposing the motion as they are not material to plaintiff’s claim for restitution of the debt it paid on defendants’ behalf. To be “material” for summary judgment purposes, the fact must be in some way essential to the judgment. (See Zavala v. Arce (1997) 58 Cal.App.4th 915, 926.) “The opposing party may not defeat summary judgment by attempting to generate a factual dispute as to immaterial issues: ‘The presence of a factual dispute will not defeat a motion for summary judgment unless the fact in dispute is a material one.’ (Citations)” (Romero v. American President Lines, Ltd. (1995) 38 Cal. App. 4th 1199, 1203) Under this materiality standard, a number of alleged “facts” asserted by the defendants may be disregarded as they do not touch on the elements of plaintiff’s straightforward claim. These alleged fact include (1) the defendants’ 2001 purchase and the original transfer from the Miguels; (2) Para. 22 of the DOT, (3) other loans or unrelated credit transactions involving the Defendants, (4) the failed transaction with the Dobkins, (5) events that pre-date the events giving rise to the Plaintiff’s claim, (6) Defendants’ efforts to restructure their debts or sell their condo, (7) defendants’ communications with Fidelity, and (8) Fidelity’s investigation. With these immaterial issues removed, no dispute about the unjust enrichment exists.
Francois Badeau also states in his declaration that, when he sold the Carnation property, he did not believe that the HELOC was attached to the property. (Badeau Decl. at ¶10) He further states that he believed that the home equity loan was tied to his Las Vegas Property (Badeau Decl. at ¶12-13; Opp. at 6:26-27). But these claims are directly inconsistent with his use of the HELOC to draw funds and his admission that he never signed a DOT securing the HELOC against the Las Vegas Property. Further, the Defendants admit they never instructed Wells Fargo to terminate the HELOC DOT which was secured by the Carnation property. (UMF 6) Further, the DOT contained the same loan number as stated on the Wells Fargo loan statement reflecting the cash withdrawals Defendants made from the HELOC after the sale of the Carnation property to the Millers. (Exh. 1 to Badeau Decl.; Exh. N-3 to Nygaard Decl.) The Court finds that the Defendants have failed to establish by admissible evidence that there is a question of fact as to whether they had reason to know or suspect that the HELOC DOT remained as an encumbrance on the Carnation property.
The Court GRANTS Plaintiff’s Request for Judicial Notice as to Items A-I in its request.
The Court GRANTS Defendants’ Request for Judicial Notice as to Item 1 in their request.
The Court SUSTAINS the Plaintiff’s objection nos. 1, 4, 5, 6, 7, 8, 9, 10, 11. Each is sustained based on hearsay. Additionally, nos. 1, 4, 7, 8, 10, 11 are sustained as lacking personal knowledge. Additionally, nos. 4, 7, 8, 10, 11 are sustained as the writing is not properly authenticated.
The Court OVERRULES plaintiff’s objection nos. 2 and 3 regarding discovery requests and responses. Plaintiff also submits a document entitled “Objections to Defendant’s Statement of Undisputed Facts” but which states within the document that it is “Moving Party’s Response and Supporting Evidence.” This document is not in the form of an objection as required by CRC 3.1354 and therefore the Court treats this as Plaintiff’s response to the separate statement.
The Court SUSTAINS defendants’ objection to ¶3 of the Nygaard Decl. which states, “On October 1, 2001, by way of a Quitclaim Deed recorded on November 27, 2001, Robert San Miguel and Linda San Miguel (collectively referred to herein as the "San Miguels") conveyed an undivided one-half' (1/2) interest in the Property to the Defendants (the "50% Quitclaim Deed”),” as hearsay.
Plaintiff is directed to prepare a proposed judgment in favor of the plaintiff as the prevailing party in the amount of $190,000, plus costs and interest as available by law Any request for interest in the proposed judgment should be supported by a written brief setting forth the basis for the calculation. Defendants will be given 10 days from the filing date to oppose this calculation.
Moving party is ordered to give notice of this ruling.