Judge Deirdre Hill, Case 21TRCV00443 2022-09-29 Tentative Ruling

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The motion for a right to attach order and issuance of writ of attachment is GRANTED.

On June 16, 2021, plaintiff Marcia Pyin-Shan Chiang (“Chiang”) filed a complaint against defendants Joseph Yeh aka Joseph Cha-Dea Yeh (“Yeh”), IDJ Enterprise Inc. (“IDJ”), and Grandtower Group Inc. (“Grandtower”) for (1) breach of contract and (2) declaratory relief and cancellation of instruments.

On October 20, 2021, defendants/cross-complainants Yeh, IDJ, and Grandtower filed a cross-complaint against plaintiff/cross-defendant Chiang for (1) breach of written contract, (2) breach of oral contract, (3) breach of the covenant of good faith and fair dealing, and (4) breach of the covenant of good faith and fair dealing.

“Upon the filing of the complaint or at any time thereafter, the plaintiff may apply pursuant to this article for a right to attach order and a writ of attachment by filing an application for the order and writ with the court in which the action is sought.” CCP § 484.010.

The application shall be executed under oath and must include: (1) a statement showing that the attachment is sought to secure the recovery on a claim upon which an attachment may be issued; (2) a statement of the amount to be secured by the attachment; (3) a statement that the attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based; (4) a statement that the applicant has no information or belief that the claim is discharged or that the prosecution of the action is stayed in a proceeding under the Bankruptcy Act (11 U.S.C. section 101 et seq.); and (5) a description of the property to be attached under the writ of attachment and a statement that the plaintiff is informed and believes that such property is subject to attachment. CCP § 484.020.

“The application [for a writ of attachment] shall be supported by an affidavit showing that the plaintiff on the facts presented would be entitled to a judgment on the claim upon which the attachment is based.” CCP § 484.030.

The court shall issue a right to attach order if the court finds all of the following:

(1) The claim upon which the attachment is based is one upon which an attachment may be issued.

(2) The plaintiff has established the probable validity of the claim upon which the attachment is based.

(3) The attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based.

“A claim has ‘probable validity’ where it is more likely than not that the plaintiff will obtain a judgment against the defendant on that claim.” CCP § 481.190.

Defendant/cross-complainant Grandtower seeks a writ of attachment against plaintiff/cross-defendant Chiang in a total amount of $103,075.54.

This motion is based on a claim for breach of a lease agreement. To establish a claim for breach of contract, a plaintiff must prove: (1) existence of a contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach of the contract, and (4) damages incurred by plaintiff as a result of the breach. Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1367.)

Cross-Complainant Grandtower has submitted a declaration from Sharyn Liu, the Chief Executive Officer, director, and registered agent for service of process for Grandtower from the time of its inception in October 2010 until it dissolved on April 4, 2019. Liu Decl., ¶ 2. Liu is the current Vice President for Yokohama Group, Inc., which hired Grandtower to be its property manager for the premises that is the subject of the lease agreement. Id. Yokohama Group, Inc. has since taken over as property manager for the subject premises. Id.

According to Liu, Grandtower and Chiang entered into a lease agreement on January 9, 2019 wherein Chiang agreed to lease the premises from Grandtower for a ten-year period for the purpose of operating a Chinese food restaurant on the premises. Liu Decl., ¶ 4, Ex. A. Pursuant to the terms of the lease agreement, Grandtower agreed to provide Chiang a six-month rent-free period from January 10, 2019 through July 10, 2019 in order to allow Chiang to apply for necessary permits for her restaurant. Id., ¶ 5. The lease agreement provided that Chiang would pay pro-rated rent in the amount of $2,996.67 for July 2019. Id., ¶ 6. When Chiang was unable to obtain the necessary permits for the construction/renovation of her restaurant, she reached out to Liu and asked for a rent reduction. Id. Liu agreed to reduce Chiang’s rent to $2,000 for August, September, and October 2019. Id. Chiang failed to make a single payment to Grandtower despite her possession of the premises. Id. According to Liu, Chiang owed rent in a total amount of $95,985.54. Id., ¶ 8.

Grandtower’s evidence is sufficient to support all elements of a breach of lease agreement claim against Chiang. Grandtower has thus established the probable validity of its breach of lease agreement claim in the amount of $95,985.54.

“[A]n attachment may be issued only in an action on a claim or claims for money, each of which is based upon a contract, express or implied, where the total amount of the claim or claims is a fixed or readily ascertainable amount not less than five hundred dollars ($500) exclusive of costs, interest, and attorney’s fees.” CCP § 483.010(a). “An attachment may not be issued on a claim which is secured by any interest in real property arising from agreement . . . .” CCP § 483.010(b).

“If the action is against a defendant who is a natural person, an attachment may be issued only on a claim which arises out of the conduct by the defendant of a trade, business, or profession.” CCP § 483.010(c). “An attachment may not be issued on a claim against a defendant who is a natural person if the claim is based on the sale or lease of property, a license to use property, the furnishing of services, or the loan of money where the property sold or leased, or licensed for use, the services furnished, or the money loaned was used by the defendant primarily for personal, family, or household purposes.” Id.

Grandtower’s motion for issuance of a writ of attachment is based on an express contract—i.e., the written lease agreement. The total amount allegedly due on the agreement is readily ascertainable and more than $500. There are no indications Chiang holds an interest in real property to secure the amount of the claim.

Grandtower has also demonstrated that the claim arises out of Chiang’s business because Chiang leased the premises for the purpose of running a restaurant. Liu Decl., ¶ 4, Ex. A, Basic Lease Provisions, § I.

CCP § 484.090 states that the court shall issue a right to attach order if “the attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based . . . [and] the amount to be secured by the attachment is greater than zero.” CCP § 484.090.

Grandtower declares that the attachment is not sought for a purpose other than recovery on its claim. Application, ¶ 4. The amount to be secured is greater than zero.

CCP § 487.010 provides that where the defendant is a natural person, all of the following property is subject to attachment:

(1) Interests in real property except leasehold estates with unexpired terms of less than one year.

(2) Accounts receivable, chattel paper, and general intangibles arising out of the conduct by the defendant of a trade, business, or profession, except any such individual claim with a principal balance of less than one hundred fifty dollars ($150).

(6) Final money judgments arising out of the conduct by the defendant of a trade, business, or profession.

(7) Money on the premises where a trade, business, or profession is conducted by the defendant and, except for the first one thousand dollars ($1,000), money located elsewhere than on such premises and deposit accounts, but, if the defendant has more than one deposit account or has at least one deposit account and money located elsewhere than on the premises where a trade, business, or profession is conducted by the defendant, the court, upon application of the plaintiff, may order that the writ of attachment be levied so that an aggregate amount of one thousand dollars ($1,000) in the form of such money and in such accounts remains free of levy.

Grandtower seeks attachment of: interests in real property; accounts receivable, chattel paper, and general intangibles arising out of conduct by Chiang of a trade, business, or profession; equipment; farm products; inventory; final money judgments arising out of the conduct by Chiang of a trade, business, or profession; money on the premises where a trade, business, or profession is conducted by Chiang; negotiable documents of title; instruments; securities; and minerals or the like to be extracted. The request for attachment of this property is appropriate under CCP § 487.010(c).

CCP § 483.015(b) provides the amount to be secured by the attachment shall be reduced by:

(1) The amount of any money judgment in favor of the defendant and against the plaintiff that remains unsatisfied and is enforceable

(2) The amount of any indebtedness of the plaintiff that the defendant has claimed in a cross-complaint filed in the action if the defendant’s claim is one upon which an attachment could be issued

(3) The amount of any claim of the defendant asserted as a defense in answer pursuant to Section 431.70 if the defendant’s claim is one upon which an attachment could be issued had an action been brought on the claim when it was not barred by the statute of limitations

(4) The value of any security interest in the property of the defendant held by the plaintiff to secure the defendant’s indebtedness claimed by the plaintiff, together with the amount by which the value of the security interest has decreased due to the act of the plaintiff or a prior holder of the security interest

“[T]o sustain reduction in a writ amount, most courts require that the defendant provide enough evidence about its counterclaims and/or defenses to prove a prima facie case [for attachment against Plaintiff].” Ahart, California Practice Guide: Enforcing Judgments and Debts, ¶ 4:64 (1998 rev.).

Chiang has not filed an opposition to this motion and has thus not shown that the amount of attachment should be reduced.

CCP § 489.210 requires the plaintiff to file an undertaking before issuance of a writ of attachment. Pursuant to CCP § 489.220, the amount of the undertaking will be $10,000 absent an objection. The failure to post an undertaking prior to the issuance of the writ of attachment renders the writ of attachment void ab initio. Vershbow v. Reiner (1991) 231 Cal.App.3d 879, 883.

CCP § 482.110 provides the court with discretion to include an estimated amount for costs and allowable attorney’s fees in the amount to be secured by the attachment. CCP § 482.110(a).

Grandtower seeks attorney’s fees in the amount of $7,090.00. This amount consists of $3,140.00 for attorney’s fees incurred in the related unlawful detainer action and $3,950.00 incurred in this action. Grandtower’s counsel has submitted a declaration indicating counsel bills at an hourly rate of $300.00 and that the $3,950.00 was incurred with regards to Grandtower’s efforts to recover unpaid rent and attorney’s fees pursuant to the cross-complaint. Berschauer Decl., ¶¶ 2-3. This general information is insufficient to justify the $3,950.00 requested for attorney’s fees incurred in this action. Further, Grandtower has not justified the inclusion of attorney’s fees incurred in the related unlawful detainer action in this action. The Court thus declines to include allowable attorney’s fees in the amount to be secured by the attachment.

Based on the foregoing, the motion for a right to attach order and issuance of writ of attachment is GRANTED in the reduced amount of $95,985.54.

The granting of the motion is conditioned upon Grandtower’s posting of an undertaking in the amount of $10,000.00 and submission of a proposed right to attach order and order for issuance of writ of attachment after hearing (Form AT-120).