Judge David J. Cowan, Case 19STCV01901 2023-02-24 Tentative Ruling

Judge: David J. Cowan, Case: 19STCV01901, Date: 2023-02-24 Tentative Ruling

Case Number: 19STCV01901 Hearing Date: February 24, 2023 Dept: 200

LOS ANGELES SUPERIOR COURT – WEST DISTRICT
BEVERLY HILLS COURTHOUSE – DEPT. 200
JUDGE DAVID J. COWAN

TENTATIVE RULING ON MOTION OF DEFENDANT TO TERMINATE DISCOVERY REFERENCE

Ming-Chao Huang, et al. v. Michael Velcherean, Case No. 19STCV01901 (related to Estate of Amy Huang, Case No. 18STPB11082)

Hearing Date: February 24, 2023, 8:30 a.m.

BACKGROUND

On November 15, 2021, the Court (by the then assigned judge, Judge Michael Small) issued an order making a reference to a referee (Hon. James A Steele (Ret.)) for hearing discovery issues in both the related cases.

On August 29, 2022, the Court (again by Judge Small) issued a further order clarifying that the reference was a special reference (requiring that the Court review the referee’s recommendations and any objections to it) and for the parties to each pay one half of the referee’s fees.

On January 9, 2023, Judge Small held a hearing on an ex parte application by Spouse to terminate the reference, at which time the Court indicated the issue, including any inability to pay for it, should be brought before the then assigned judge who was to try this case.

On January 27, 2023, Judge Brenda Penny, the Probate Supervising Judge, assigned these cases to the undersigned.

On February 6, 2023, defendant Michael Velcherean (“Spouse”) filed an ex parte application for an order terminating the discovery reference.

On February 7, 2023, the Court denied the application on an ex parte basis and set the application for hearing as a motion on February 24, 2023.

On February 9, 2023, plaintiff Ming Chao Huang and affiliated parties (“Family Parties”) filed opposition to the motion.

On February 17, 2023, Spouse filed a Reply Brief in support of the motion.

DISCUSSION

In summary, Spouse contends he cannot afford the reference based upon his monthly income of $4,000, as well as his temporary family allowance of $15,050, pursuant to an order of November 23, 2022. He contends that the referee has charged $120,000 in fees to date and that additional fees are anticipated in connection with other discovery disputes.1 He contends that the reference is unfair where the Family Parties have considerable financial means and can afford the reference. He further indicates opposition to the Family Parties advancing the fees of the referee as to do so would prejudice the referee.

In summary, Family Parties argue first that the request to terminate reference is an impermissible motion for reconsideration. They then contend on the merits that the reason for the motion is not lack of financial means but that the referee has made numerous rulings adverse to Spouse, including a total of $92,080 in monetary sanctions. They argue further that Spouse has not provided evidence supporting his claim of financial inability and provides certain prior inconsistent statements of Spouse to other persons. Further, they argue that the reference is necessary in view of the unfounded positions Spouse has taken.

Initially, the Court finds that this motion is not an untimely motion for reconsideration under CCP sec. 1008(a) that Judge Small would need to hear, where at least two relevant events have occurred since Judge Small last made an order concerning the reference that change what is before the Court: First, the decision on November 11, 2022 awarding Spouse about a quarter of what he had requested in a family allowance. Judge Small had stated in making the August 29, 2022 order on the reference that he was mindful that Spouse’s ability to pay for the reference may be intertwined with that then pending petition. Second, the significant fees the parties have incurred and may continue to incur to the referee. Therefore, this would still be a permissible motion for reconsideration under CCP sec. 1008(b). Hence, the Court will turn to the merits:

Most crucially, the Court sustains the evidentiary objection as to the lack of foundation of the assertion in Spouse’s verified petition for a family allowance that his monthly income is about $4,000 – that is the sole basis for the claimed inability to pay.2 The Court is given no basis for how Spouse arrived at that figure by way of reference to pay stub, bank statement or other reliable indicator. Moreover, Spouse failed to provide any declaration in the reply to address this concern – or the seemingly prior inconsistent statements - raised in the opposition. Further, the Court does not know what amount of that $4,000 or of the family allowance he needs for his support or for other reasons. Finally, in this regard, Spouse improperly narrows the issue of inability to pay to one of just his income. However, the papers suggest he or entities that may be under his control could have considerable assets that could be used to pay the referee’s fees. For example, Family Parties indicate Spouse has considerable income that presumably is derived from his own money.3 Without a realistic picture of Spouse’s present financial condition, he has not met his burden to show a changed circumstance of inability to pay.

In view of the foregoing, the Court does not need to reach the issue of whether Spouse’s real motive for filing the motion might be forum shopping -- to avoid further adverse rulings of the referee.4

Like Judge Small, this bench officer is also mindful of not wishing to impose the significant costs of a referee on a party who may not be able to afford one. Hood v. Superior Court (1999) 72 Cal.App.4th 446, 450, Taggares v. Superior Court (1998) 62 Cal.App.4th 94, 105-106 (where unlike here the Court also had the benefit of the evidence of the expenses of the party seeking relief). In sum, it is still the burden of the party seeking relief to provide the necessary evidence, including “…the impact of the proposed fees on the party’s ability to procced with the litigation.” CCP sec. 639(d)(6)(B) Similarly, whether the Court should modify the prior order for apportionment of fees under CRC Rule 3.922(f)(3) (e.g., for Family Parties to advance those fees) is not now before the Court and would also require necessary evidence.

Moreover, Family Parties argue the motion should in any event be denied because there were “exceptional circumstances” for a discovery referee in view of Spouse’s litigation conduct and that this further expense of a referee is Spouse’s own doing. Calif. Rules of Court, Rule 3.922(c)(2)

CONCLUSION

For these reasons, the Court denies the motion, without prejudice.

1) By contrast, the referee’s hourly rate of $950 was known at the start and is part of the initial order of reference.

2) The Court overlooks at this point the further argument that technically no declaration was filed by Spouse in support of the motion. While a statement in a verified petition is not the same as a declaration, they are in many ways essentially the same and no argument is made that they should not be treated similarly. That said, Spouse should have at least attached the verified petition in his motion papers. In future, Spouse should include the relevant evidence that may be in other parts of the very large file in this case.

3) Family Parties’ reference to certain statements by Spouse from years earlier may however not be instructive as to Spouse’s present financial picture -- that may have changed after the death of Amy Huang.

4) Family Parties argued that Spouse brought this request on an ex parte basis on February 6, 2023 to avoid the referee issuing a further report and recommended rulings – a tentative of which was provided prior to the ex parte application. (The referee subsequently issued his report on February 16, 2023.) However, it appears that this request to terminate the reference was made a month previously before Judge Small.