Judge: David A. Rosen, Case: EC065517, Date: 2022-12-23 Tentative Ruling
Case Number: EC065517 Hearing Date: December 23, 2022 Dept: E
Hearing Date: 12/23/2022 – 8:30am
Case No. EC065517
Trial Date: N/A
Case Name: WVBAGD, LLC. v. GREG GALLETLY, ET AL.
TENTATIVE RULING ON MOTION TO DISBURSE PRELIMINARY INJUNCTION BOND
Moving Party: Cross-Defendant, WVBAGD, LLC (Lender)
Responding Party: Cross-Complainants, Bradley Barnes and BABBB, LLC
Opposition and Reply submitted.
RELIEF REQUESTED¿
Cross-Defendant, WVBAGD, LLC (Lender) moves the Court for an order disbursing the preliminary injunction bond posted by BABBB, LLC and Bradley Barnes in the amount of $40,0001.00.
PROCEDURAL
16/21 Day Lapse (CCP §12c and §1005(b): Ok
Proof of Service Timely Filed (CRC, Rule 3.1300): Ok
Correct Address (CCP §1013, §1013a): Ok
BACKGROUND
[This background is based on WVBAGD’s “Statement of Facts” section in its moving papers.]
This action was initiated following extensive monetary and non-monetary defaults under a promissory note and a deed of trust signed by Judgment Debtors in favor of Lender. The deed of trust was recorded against 1312 Loreto, Glendale, California (the “Loreto Property”). (O’Neill Dec. ¶¶ 3-5.) On September 27, 2018, Judgment Debtors filed a Cross-Complaint against Lender, and in conjunction with his co-borrowers under the note, sought and obtained a preliminary injunction. (RJN, Ex. 1.) When ruling on the request for an injunction, the Court found that the Cross-Complainants were unlikely to succeed on the merits of their claims challenging the terms of the Note, the interest rate, enforcement costs, and the ability of Lender to collect. (Id.) Notwithstanding those findings, the Court granted and issued a preliminary injunction, and ordered Barnes to post a bond which was subsequently increased to the sum of $40,001.00 (the “Bond”). (RJN, Exs. 2-3.)
On January 15, 2021, the Court sustained Lender’s Demurrer to the Verified Fourth Amended Cross-Complaint without leave to amend, which dissolved the injunction. (RJN, Ex. 4.) Judgment was entered on February 8, 2021. (Id., Ex. 5.) The Judgment provides that WVBAGD may recover its fees and costs, in an amount to be set by the Court. (Id.)
On February 11, 2021, Judgment Debtors filed a Notice of Appeal. (RJN, Ex. 6.) On March 1, 2021, Judgment Debtors filed a Petition for Writ of Supersedeas to try to stop the foreclosure, which was denied. (Id., Ex. 7.) In their Petition for Writ of Supersedeas, Judgment Debtors argued: “Cross-Complainants posted an undertaking in the sum of $40,001, which a prior trial court judge determined was sufficient to protect WVBAGD’s interests. This undertaking will continue to protect WVBAGD’s interests during the pendency of the appeal…” (RJN, Ex. 7 at ¶ 32.)
On May 24, 2021, the Court of Appeal issued an Order denying the Petition for Writ of Supersedeas, clearing the way for Lender to complete its Trustee’s Sale. (RJN, Ex. 8; Dowdall Dec. Ex. 1.) On December 17, 2021, Judgment Debtors filed a Renewed Petition for Writ of Supersedeas to try to stop the foreclosure, which was denied on December 20, 2021. (Id., Exs. 9-10.)
On December 29, 2021, a non-judicial foreclosure of the Loreto Property was conducted. (RJN, Ex. 11-12.) A deficiency of $163,670.88 remained following foreclosure. (RJN, Ex. 12; Dowdall Dec. Ex. 1.)
After the parties had fully briefed the Appeal and without conducting oral argument, the Court of Appeal issued an Opinion dismissing the Appeal and holding that Lender shall recover its costs. (Id., Ex. 13.) Thereafter, on September 14, 2022, the Remittitur issued, which states: “[WVBAGD, LLC] shall recover its costs on appeal.” (Id., Ex. 14.)
On September 29, 2022, Lender filed its Memorandum of Costs on Appeal. On October 3, 2022, Lender filed its Motion for Award of Attorneys’ Fees on Appeal, which came on for hearing on November 18, 2022. Lender was awarded $115,266.10 in fees and costs, which exceeds the amount of the Bond by $75,265.10. (RJN, Ex. 15; see also O’Neill Dec. ¶ 8.)
During the pendency of the litigation, Barnes filed for bankruptcy. (RJN, Ex. 16.) Barnes did not identify the Bond as an asset of the Bankruptcy Estate. (Id.) Thereafter, the Trustee abandoned the Bankruptcy Estate’s interest in the litigation. (RJN, Ex 17.) This Motion therefore has no effect on, and is not impacted by, the bankruptcy.
ANALYSIS
Lender wants the $40,001.00 bond to be disbursed to the Lender as partial compensation for damages that it allegedly sustained by reason of the injunction and subsequent appeal, and for it to be applied as a partial satisfaction to the awarded attorneys’ fees and costs that were awarded at the 11/18/2022 hearing.
As a preliminary matter, Lender provides no points and authorities to the Court in this motion, nor does it indicate the legal basis or statutory section that it is basing its motion and argument that the bond can be disbursed to the Lender.
On page 7 of its moving papers, Lenders cites CCP §529, and it appears as if Lender may be basing the relief it requests on CCP §529, under which the bond, and the subsequently increased bond, were expressly issued.
In relevant part, CCP §529 states:
On granting an injunction, the court or judge must require an undertaking on the part of the applicant to the effect that the applicant will pay to the party enjoined any damages, not exceeding an amount to be specified, the party may sustain by reason of the injunction, if the court finally decides that the applicant was not entitled to the injunction. Within five days after the service of the injunction, the person enjoined may object to the undertaking. If the court determines that the applicant’s undertaking is insufficient and a sufficient undertaking is not filed within the time required by statute, the order granting the injunction must be dissolved.
(CCP §529(a).)
The Declaration submitted in the moving papers of Anthony V. O’Neill, manager of WVBAGD, LLC simply stated, “WVBAGD was forced to defend itself on Barnes’ appeal, and prevailed. As a result of the appeal, WVBAGD incurred significant attorneys’ fees and costs. WVBAGD seeks recovery of the court-ordered $40,001.00 bond as partial satisfaction of the attorneys’ fees and costs awarded on appeal.” (Decl. O’Neil ¶8.)
Here, Lender failed to meet its burden to show what damages, if any, it sustained as a result of the injunction, and Lender failed to meet its burden to show what part, if any, of its attorneys’ fees on appeal have anything to do with the dissolution of the injunction, nor that the court at some point decided that applicant (Responding party here) was not entitled to the injunction. Further, Lender cites no case law or statute that the bond can be used essentially as security for the attorneys’ fees it was awarded on November 18, 2022.
TENTATIVE RULING
Motion to disburse preliminary injunction bond by WVBAGD LLC is DENIED.
Case No. EC065517
Trial Date: 04/10/2023
Case Name: G’s PROPERTIES, INC., ET AL v. ALICE MARYSOL ORTIZ, ET AL
TENTATIVE
RULING – MOTION TO COMPEL RESPONSES, REQUESTS FOR PRODUCTION
Moving Party: Plaintiffs, G’s Properties, Inc., et al
Responding Party: No Opposition submitted
No
Reply submitted.
RELIEF REQUESTED¿
Plaintiffs, G’s Properties, Inc., et
al. move the Court for an order compelling Defendant, Bank of Hope, to respond
to Plaintiffs request for production of documents served on December 21, 2021.
Plaintiffs also move the Court for
an order requiring Defendant, or its attorney, Fadi Rasheed, Esq., to pay costs
including reasonable attorney’s fees of $1,685.00 incurred in preparation of
this motion. The request for sanctions will be made pursuant to CCP §§2023.030
and 2031.300.
The Court notes that Plaintiffs’
counsel simply refers to the request for production of documents as those
served on December 21, 2021, in the notice of the instant motion. The Court
Notes Exhibit 4 contains these requests. The document is titled “Demand for
Production of Documents,” and the propounding party is noted as “Plaintiffs,”
the responding party is noted as “Defendant Bank of Hope,” and the “Set Number”
is noted as “Five.” The “Demand for Production of Documents” contains seven (7)
requests.
Procedural
16/21
Day Lapse (CCP §12c and §1005(b): Ok
Proof of Service Timely Filed (CRC, Rule 3.1300): Ok
Correct Address (CCP §1013, §1013a): Unclear – In the proof of service for the instant motion, the
instant motion is alleged to be served by mail. As to Fadi Rasheed, the alleged
counsel for Defendant, Bank of Hope, the address served was “2041 Rosecrans
Avenue, Suite 300, El Segundo, CA 90245.” The Court does list this address
served as Fadi’s correct address on eCourt. However, eCourt also lists “2041
Rosecrans Ave, Suite 300, Ste 325, El Segundo, CA 90245,” as Fadi’s address.
The Court intends to ascertain at the instant hearing that Defendant’s counsel
was properly served the instant motion.
BACKGROUND
The instant background is from the Declaration of Richard P. Petersen,
moving party’s counsel.
Plaintiffs filed their initial complaint on January 16,
2016. A Third Amended Complaint for damages was filed on May 17, 2017.
(Petersen Decl. ¶2.) On or about June 8, 2017, Defendant Bank of Hope filed its
answer to the complaint. (Id. ¶3.) On December 21, 2021, Plaintiffs
served Defendant Bank of Hope with a request for production of documents. (Id.
¶4.) A copy of the request for production of documents is attached to the
instant motion at Exhibit A. (Id.) By letter on October 14, 2022, I
advised Defendant’s attorney that a response to the request for production of
documents was overdue. (Id. ¶5.) I requested a response within fifteen
days in order to avoid a motion to compel. (Id.) A copy of the letter is attached hereto
as Exhibit B. (Id.) To date, I have not received the
Defendant’s response to the request for production of documents, nor has Mr.
Rasheed responded to my letter. (Id. ¶6.)
LEGAL
STANDARD – COMPEL RESPONSES, INSPECTION DEMANDS
Within
30 days after service of a demand for inspection, copying, testing, or
sampling, the party to whom the demand is directed shall serve the original of
the response to it on the party making the demand, and a copy of the response
on all other parties who have appeared in the action, unless on motion of the
party making the demand, the court has shortened the time for response, or
unless on motion of the party to whom the demand has been directed, the court
has extended the time for response. (CCP §2031.260(a).)
If a party to whom a demand for inspection, copying,
testing, or sampling is directed fails to serve a timely response to it, the
party making the demand may move for an order compelling response to the
demand. (CCP §2031.300(b).)
Here, the demand for production of documents, set
five, were served on December 21, 2021 by mail. Plaintiffs’ counsel alleges
that to date, he has not received the Defendant’s responses to the request for
production of documents. (Decl. Petersen ¶6.) Petersen’s declaration was signed
on November 2, 2022, and the instant motion was filed on 11/03/2022. Therefore,
30 days has passed since service of the requests and Defendant Bank of Hope has
not timely responded.
If a party to whom a demand for inspection, copying,
testing, or sampling is directed fails to serve a timely response to it, the
party to whom the demand for inspection, copying, testing, or sampling is
directed waives any objection to the demand, including one based on privilege
or on the protection for work product under Chapter 4 (commencing with Section
2018.010). (CCP §2031.300(a).) “The court, on motion, may relieve that
party from this waiver on its determination that both of the following
conditions are satisfied: (1) The party has subsequently served a response that
is in substantial compliance with Sections 2031.210, 2031.220, 2031.230,
2031.240, and 2031.280. (2) The party’s failure to serve a timely response was
the result of mistake, inadvertence, or excusable neglect.” (CCP
§2031.300(a)(1)-(2).)
Here, Defendant Bank of Hope appears to have waived
objections for failing to respond.
Unlike a motion to compel further responses, a motion
to compel responses is not subject to a 45-day time limit, and the propounding
party does not have to demonstrate either good cause or that it satisfied a
“meet and confer” requirement. (Sinaiko Healthcare Consulting, Inc. v.
Pacific Healthcare Consultants (2007) 148 Cal.App.4th 390, 404
citing Weil and Brown, Cal. Practice Guide: Civil Procedure Before Trial (The
Rutter Group 2006) ¶¶8:1137 to 8:1144, pp. 8F-59 to 8F-60, ¶¶ 8:1483 to 8:1489,
pp. 8H-29 to hH-30 (Weil & Brown).)
TENTATIVE RULING
Plaintiffs’
motion to compel responses to request for production of documents served on
December 21, 2021 [aka Demand for Production of Documents, Set Five, as to
Defendant Bank of Hope] is GRANTED if Plaintiffs’ counsel can demonstrate
adequate proof of service of the instant motion and the requests for production
that this motion is based on.
Defendant Bank is to provide verified responses, without objection, to the
request for production of documents within fifteen (15) days and to produce the
documents requested within twenty (20) days.
Sanctions
Except
as provided in subdivision (d), the court shall impose a monetary sanction
under Chapter 7 (commencing with Section 2023.010) against any party, person,
or attorney who unsuccessfully makes or opposes a motion to compel a response
to a demand for inspection, copying, testing, or sampling, unless it finds that
the one subject to the sanction acted with substantial justification or that
other circumstances make the imposition of the sanction unjust. (CCP
§2031.300(c).)
Here, Plaintiffs’ counsel requests Defendant or
Defendant’s attorney, Fadi Rasheed to pay costs including reasonable attorney’s
fees of $1,685.00. Petersen states he incurred 3 hours in the preparation of
this motion, $60.00 for the filing fee, and he anticipates he will incur at
least two hours at the appearance for the hearing. Petersen states his billing
rate is $325.00 per hour. (Decl. Petersen ¶8.)
The Court awards $1,360.00 in reasonable discovery
sanctions to movant, against Defendant Bank, to be paid within 30 days.