Judge: Gail Killefer, Case: 21STCV22638, Date: 2023-01-09 Tentative Ruling
Case Number: 21STCV22638 Hearing Date: January 9, 2023 Dept: 37
HEARING DATE: January 9, 2023
CASE NUMBER: 21STCV22638
CASE NAME: Salvatore J.
Balsamo, Trustee, Balsamo Family Trust dated May 16, 1991, as Amended and
Restated April 20, 2004, Sub-Trust B. v. Victor Amaya, an individual d.b.a. M.
P. Tire shop, et al.
MOVING PARTY: Plaintiff, Salvatore J.
Balsamo, Trustee, Balsamo Family Trust dated May 16, 1991 as Amended and
Restated April 20, 2004, Sub-Trust B
OPPOSING PARTIES: Defendants, Marjorie Amaya and Amaya Tire
Service, Inc.
TRIAL DATE: March 7, 2023
PROOF OF SERVICE: OK
PROCEEDING: Plaintiff’s Motion for
Summary Judgment
OPPOSITION: November 4, 2022
REPLY: November
9, 2022
TENTATIVE: Plaintiff’s motion is
denied as to the first cause of action. It is otherwise granted. Plaintiff is
to give notice.
Background
This action arises in connection with a commercial building
owned by Salvatore J. Balsamo, Trustee, Balsamo Family Trust dated May 16, 1991
as Amended and Restated April 20, 2004, Sub-Trust B (“Plaintiff”) located at
5502 S. Avalon Boulevard, Los Angeles, California (the “Property”). Plaintiff
alleges that Defendant Victor Amaya (“Mr. Amaya”) has been a tenant at the
Property for over 29 years and operates a tire shop known as Defendant, M.P.
Tire Shop (“MP Tire”). Additionally, Defendant Marjorie Amaya (“Ms. Amaya”) has
allegedly also worked at the business. On May 13, 2017, Plaintiff served a
3-day and 30-day notice on Mr. Amaya to quit the Property and Mr. Amaya failed
to respond, resulting in Plaintiff filing an unlawful detainer action against
him. Thereafter, the parties settled the unlawful detainer action, with Mr. Amaya
agreeing to return possession of the Property by June 30, 2017.
Mr. Amaya later sued Plaintiff, alleging that Plaintiff had
wrongfully interfered with his business and wrongfully evicted him (“Debtor’s
Action”). According to Mr. Amaya’s
lawsuit, Ms. Amaya and Plaintiff had allegedly entered into an oral agreement
that Mr. Amaya could post a sign indicating that his business had moved.
Plaintiff filed a Cross-Complaint in this action and had judgment (the
“Judgment”) entered in his favor on the Cross-Complaint, which has not been
satisfied to date. According to Plaintiff, Ms. Amaya incorporated Defendant,
Amaya Tire Service, Inc. (“Amaya Tire Service”) and purchased all of the assets
of Defendant MP Tire Service in an effort to hinder Plaintiff from collecting
the Judgment.
Plaintiff’s Complaint alleges the following causes of
action: (1) declaratory relief, (2) to set aside void transfer of personal
property, (3) to set aside voidable transfer, (4) judgment debtor’s interest in
property to satisfy money judgment against Amaya and Amaya Tire Service.
Plaintiff
now moves for summary judgment as to the Complaint’s causes of action, as
follows:
1. Issue 1: Plaintiff will move this Court for an order granting
summary adjudication as to the Fourth Cause of Action for a Creditor’s Suit on
the grounds that there is no triable issue of material fact as to any elements
of the Creditor’s claim.
2. Issue
2: Plaintiff will move this Court for an order granting summary adjudication as
to the Second Cause of Action to Set Aside Void Transfer of Personal Property
on the grounds there is no triable issue of material fact as to any elements of
Plaintiff’s claim for fraudulent or voidable transfer.
3. Issue
3: Plaintiff will move this Court for an order granting summary adjudication on
the Complaint’s Third Cause of action to Set Aside Voidable Transfer on the
grounds there is no triable issue of material as to any elements of Plaintiff’s
claim.
4. Issue
4: Plaintiff will move this Court for an
order granting summary adjudication as to the First Cause of Action for Declaratory
Relief on the grounds there is no triable issue of material fact as to any
element of Plaintiff Creditor’s claim.
Defendants
oppose the motion. The court will address the issues in the order numbered by
Plaintiff’s motion.
Request for Judicial Notice
Plaintiff requests that the court take judicial notice of
the following in support of their motion:
1.
Verified Amended Answer to Complaint filed in
this action by Defendant Marjorie Amaya on September 3, 2021 (Exhibit R);
2.
Verified Amended Answer to Complaint filed in
this action by Defendant Amaya Tire Service, Inc. on September 3, 2021 (Exhibit
S);
3.
Articles of Incorporation of M.P. Tire Service,
Inc. filed with the Office of the California Secretary of State on November 28,
2006 (Exhibit T);
4.
Statement of Information of M.P. Tire Service,
Inc. filed with the Office of the California Secretary of State on January 29,
2007 (Exhibit U);
5.
Certificate of Information re M.P. Tire Service,
Inc (Exhibit V);
6.
Petition for Dissolution of Marriage filed on
March 1, 2016 in the matter of Ana Marjorie Pleitez-Amaya and Victor Amaya, Los
Angeles County Superior Court Case No. BD637104 (Exhibit W);
7.
Judgment for Dissolution of Marriage entered on
July 8, 2016 in the matter of BD637104 (Exhibit X);
8.
Statement of Information for Amaya Tire Service,
Inc. filed with the Office of the California Secretary of State on April 6,
2021 (Exhibit Y);
9.
Printout from California Secretary of State
website reflecting suspension and revivor of Amaya Tire Service, Inc. (Exhibit
Z);
10. Complaint
for Unlawful Detainer filed on June 8, 2017 in the matter of Salvatore J.
Balsamo, Trustee, Balsamo Family Trust dated May 16, 1991, as Amended and
Restated April 20, 2004, Sub-Trust B v. Victor Amaya, Los Angeles County
Superior Court Case No. 17U05883 (Exhibit AA);
11. Complaint
for Damages filed on February 14, 2018, in the matter of Victor Amaya v.
Salvatore Balsamo, Trustee, etc., et al., Los Angeles County Superior Court
Case No. BC694745 (Exhibit BB);
12. First
Amended Complaint for Damages filed on May 24, 2018 in the matter of Victor
Amaya v. Salvatore Balsamo, Trustee, etc., et al., Los Angeles County Superior
Court Case No. BC693745 (Exhibit CC);
13. Cross-Complaint
for (1) Breach of Lease; (2) Breach of Settlement Agreement; (3) Waste, filed
on May 14, 2018 in the matter of Victor Amaya v. Salvatore Balsamo, Trustee,
etc., et al., Los Angeles County Superior Court Case No. BC693745 (Exhibit DD);
14. Judgment
entered on September 10, 2019, in the matter of Victor Amaya v. Salvatore
Balsamo, Trustee, etc., et al., Los Angeles County Superior Court case No.
BC693745 (Exhibit EE).
Plaintiff’s request is granted. The existence and legal
significance of these documents are proper matters for judicial notice.
(Evidence Code § 452(d), (h).)
Discussion
I.
Legal Authority
“The
purpose of the law of summary judgment is to provide courts with a mechanism to
cut through the parties' pleadings in order to determine whether, despite their
allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001)
25 Cal.4th 826, 843(“Aguilar”).) CCP
§ 437c(a) provides:
A party may move for summary judgment in any action or
proceeding if it is contended that the action has no merit or that there is no
defense to the action or proceeding. The
motion may be made at any time after 60 days have elapsed since the general
appearance in the action or proceeding of each party against whom the motion is
directed or at any earlier time after the general appearance that the court,
with or without notice and upon good cause shown, may direct…. The motion shall be heard no later than 30
days before the date of trial, unless the court for good cause orders
otherwise. The filing of the motion
shall not extend the time within which a party must otherwise file a responsive
pleading.
A
motion for summary judgment may be granted “if all the papers submitted show
that there is no triable issue as to any material fact and that the moving
party is entitled to a judgment as a matter of law.” (CCP § 437c(c).)
“The
motion shall be supported by affidavits, declarations, admissions, answers to
interrogatories, depositions, and matters of which judicial notice shall or may
be taken. The supporting papers shall
include a separate statement setting forth plainly and concisely all material
facts that the moving party contends are undisputed. Each of the material facts stated shall be
followed by a reference to the supporting evidence. The failure to comply with this requirement
of a separate statement may in the court’s discretion constitute a sufficient
ground for denial of the motion.” (CCP §
437c(b)(1); see also Cal. Rules of
Court, rule 3.1350(c)(2) & (d).)
In
analyzing motions for summary judgment, courts must apply a three-step
analysis: “(1) identify the issues framed by the pleadings; (2) determine
whether the moving party has negated the opponent's claims; and (3) determine
whether the opposition has demonstrated the existence of a triable, material
factual issue.” (Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 294 (Hinsley).) CCP § 437c(p)(2) provides:
A defendant or cross-defendant has met his or her burden of
showing that a cause of action has no merit if the party has shown that one or
more elements of the cause of action, even if not separately pleaded, cannot be
established, or that there is a complete defense to the cause of action. Once the defendant or cross-defendant has met
that burden, the burden shifts to the plaintiff or cross-complainant to show
that a triable issue of one or more material facts exists as to the cause of
action or a defense thereto. The
plaintiff or cross-complainant shall not rely upon the allegations or denials
of its pleadings to show that a triable issue of material fact exists but,
instead, shall set forth the specific facts showing that a triable issue of
material fact exists as to the cause of action or a defense thereto.
(CCP §
437c(p)(2).) The court must “view the
evidence in the light most favorable to the opposing party and accept all
inferences reasonably drawn therefrom.”
(Hinesley, 135 Cal.App.4th at p. 294; Dore
v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389 [Courts “liberally
construe the evidence in support of the party opposing summary judgment and
resolve doubts concerning the evidence in favor of that party.”].) A motion for summary judgment must be denied
where the moving party’s evidence does not prove all material facts, even in
the absence of any opposition (Leyva v.
Sup. Ct. (1985) 164 Cal.App.3d 462, 475) or where the opposition is weak (Salasguevara v. Wyeth Labs., Inc. (1990)
222 Cal.App.3d 379, 384, 387).
CCP § 437c(b) requires the opposition papers to include “a
separate statement that responds to each of the material facts contended by the
moving party to be undisputed, indicating if the opposing party agrees or
disagrees that those facts are undisputed.” (C.C.P., § 437c(b)(3).) However,
the absence of a separate statement does not preclude the Court from
considering the merits of the opposition where the case involves a single,
simple issue with minimal evidentiary support.
(Gilbertson v. Osman (1986) 185 Cal.App.3d 308, 315-16 (disapproved
on other grounds in Woods v. Young (1991) 53 Cal.3d 315); see also North
Coast Business Park v. Nielsen Construction Co. (1993) 17 Cal.App.4th 22,
31 fn. 6; Security Pacific Nat. Bank v. Bradley (1992) 4 Cal.App.4th 89,
94.)
II.
Factual Summary
In 1998, Mr. Amaya took possession of the Property and
operated a tire shop and automotive repair business called Amaya Tires.
(Separate Statement in Support of Motion (“PSS”), ¶ 1; Exhibits in Support of
Motion, Ex. A.) Prior to 2007, Amaya Tires was only a fictitious business name
of Mr. Amaya. (PPS ¶2.) On November 28, 2006, Mr. Amaya’s wife, Ana Pleitez
(“Ms. Pleitez”), formed M.P. Tire Service, Inc., listed herself as sole owner,
listed the Property as the business address and business location. (PSS ¶¶3-5.)
M.P. Tire Service, Inc. was suspended on November 1, 2010 and has not been
revived. (PSS ¶7.)
In 2013, Mr. Amaya entered into a lease for the Property
with Plaintiff and signed as “Victor Amaya, individually and dba MP Tire Shop.”
(PSS ¶ 8; Exh. P.) Plaintiff, as Creditor to Mr. Amaya, became owner and
successor landlord of the Property in July 2015. (PSS ¶11.)
On March 1, 2016, Ms. Pleitez filed a Petition for
dissolving her marriage to Mr. Amaya, claiming 100% of the business at the
Property was owned by Mr. Amaya, along with all debts and obligations
associated with that business. (PSS ¶12.) On July 8, 2016, the court awarded
Mr. Amaya 100% of the business operating at the Property as his separate
property. (PSS ¶13.)
On September 6, 2016, Marjorie Amaya, Mr. Amaya’s daughter
(“Ms. Amaya”), formed Amaya Tire Service, Inc. as a California Corporation to
“take over the family business,” but did not purchase any of M.P. Tire
Services, Inc.’s business assets or assets belonging to Mr. Amaya. (PSS
¶¶14-18.) Amaya Tire Service, Inc. listed the Property as its business
location. (PSS ¶¶19-20.) Amaya Tire Service, Inc. was suspended on April 23,
2019, and subsequently revived on April 6, 2021. (PSS ¶¶27-28.) Amaya Tire
Service operated at the Property from approximately September 2016 to July 21,
2017 but did not file tax returns from 2018 through 2020. (PSS ¶¶29-31.)
Further, after it was established, Amaya Tire Service has used Mr. Amaya’s
equipment, inventory, telephone number, office, vendors, insurance, employees, accountant,
and premises from the time it began operating at the Property. (PSS ¶32.)
Plaintiff filed an Unlawful Detainer Action against Mr.
Amaya on June 8, 2017, Superior Court of California, County of Los Angeles Case
No. 17U05883. (PSS ¶34.) Plaintiff and Mr. Amaya entered into a written
settlement agreement regarding the Unlawful Detainer action on June 27, 2017.
(PSS ¶36.) In the settlement agreement, Mr. Amaya represented he had “full,
exclusive and absolute legal and physical possession of the [Property] and
there is no other person or entity that is in possession or claims a right to
possess all or any portion of the [Property] . . .,” and full ownership of the
title to all personal property located at the Property. (PSS ¶¶37-38.)
Mr. Amaya turned over possession of the business at the
Property to Plaintiff on July 21, 2017. (PSS ¶39.) On February 14, 2018, Mr.
Amaya filed suit against Plaintiff for wrongful interference and wrongful
eviction from the Property with the Los Angeles Superior Court, Case No.
BC693745. (PSS ¶41.) Plaintiff filed a Cross-Complaint against Mr. Amaya for
damages incurred; on September 10, 2019, judgment was entered in favor of
Plaintiff on Plaintiff’s Cross-Complaint in the suit in the principal amount of
$133,813.46. (PSS ¶¶43-44.)
Even though Ms. Amaya corresponded with Plaintiff on several
occasions between September 2016 and July 21, 2017, Plaintiff contends, and
Defendants do not dispute, that Ms. Amaya “never told [Plaintiff] that she or
Defendant Amaya Tire Service had taken over [Mr. Amaya’s] business and/or its
assets.” (PSS ¶46.) Plaintiff was never informed Ms. Amaya and Amaya Tire
Service were operating at the Property during 2016 and 2017; they did not enter
into any agreement with Plaintiff to operate from the Property. (PSS ¶¶47-49.)
After eviction, Mr. Amaya moved his business to 6208 Main
Street, Los Angeles, California (the Main Street Location”). (PSS ¶40.) On
November 7, 2017, Ms. Amaya entered into a lease for the Main Street location,
and Mr. Amaya signed a personal guarantee for the Main Street lease with a
guarantee he “hereby covenants, warrants and represents that the making of this
Guaranty and making of the Lease is in furtherance of its business purpose and
is to the benefit of Guarantor.” (PSS ¶¶51-52.)
Plaintiff contends, and Defendants do not dispute, that to
the extent any assets of M.P. Tire Service or Mr. Amaya’s business were
transferred to Amaya Tire Service or Ms. Amaya, there was no delivery, no
change in possession, and no consideration given in exchange. (PSS ¶¶55-59.)
“No consideration was given by Defendant Amaya Tire Service to [Mr. Amaya] for
the transfer of any of his business assets to Defendant Amaya Tire Service.”
(PSS ¶60.)
Plaintiff also contends, and Defendants do not dispute, Mr.
Amaya continued working full-time at the business operating at the Property,
both before and after any transfer of Mr. Amaya’s business to Amaya Tire
Service or to Ms. Amaya. (PSS ¶62.) Further, there are no documents reflecting
any such transfer of business assets. (PSS ¶63.) Plaintiff further contends,
and Defendants again do not dispute, that to the extent Mr. Amaya’s assets were
transferred to Amaya Tire Service and/or Ms. Amaya, Mr. Amaya was left
insolvent as a result and now claims to have no assets following the transfer.
(PSS ¶¶64-65.)
Lastly, Plaintiff contends, and Defendants do not dispute,
Ms. Amaya maintains business records for Amaya Tire Service at her home, has
purchased vehicles for Amaya Tire Service with personal funds and registered
them in her name, and has paid personal expenses for her and her family with
Amaya Tire Service’s bank account. (PSS ¶¶66-68.)
III.
Analysis
A.
First Issue: Fourth Cause of
Action
CCP § 708.210 authorizes a
judgment creditor to bring an action against a third party who has possession
or control of property in which the judgment debtor has an interest so that the
judgment creditor may have the debt applied to satisfy the money judgment. “Section 708.210 provides, ‘If a third
person has possession or control of property in which the judgment debtor has
an interest or is indebted to the judgment debtor, the judgment creditor may
bring an action against the third person to have the interest or debt applied
to the satisfaction of the money judgment.’ ” Cabral v. Soares (2007) 157 Cal.App.4th 1234,
1242. See also generally
Cal. Practice Guide: Enf. of J. &
Debt (The Rutter Group 2017) §6:1392, et seq. A creditor may be brought
without attempting to exhaust other remedies. (Cabral, supra, 157
Cal.App.4th at 1243.) If the creditor can establish that the third person
possesses or control any property which is not exempt where the judgment debtor
has an interest or can be determined to be indebted to the judgment debtor, the
“the court shall
render” an order that such property or debt be applied to satisfy the
creditor’s judgment against the judgment debtor. (CCP § 708.280.)
Plaintiff correctly explains, “[t]here are several remedies
allowed in a creditor’s suit. These include (1) a judgment against the third
party holding a judgment debtor’s property; (2) an order that the property be
applied to satisfaction of the judgment; (3) an order that the third party may
not transfer the property until it can be levied upon; and (4) money damages
against the third party if property subject to a lien has been sold.” (Motion,
11.)
Plaintiff contends the evidence indisputably shows Ms. Amaya and
Amaya Tire Service
“have
possession and/or control of Debtor’s Business and all of the assets thereof,
including the business assets, cash, deposit accounts, accounts
receivable, trade fixtures, and other tangible and intangible assets of
Debtor’s Business, all of which are currently located at the Main Street
Location and/or at Defendant Daughter’s residence. Neither Defendant Daughter
nor Defendant Amaya Tire Service ever paid any consideration to Defendant
Debtor (or anyone else) for these assets, but merely changed the name of
Debtor’s Business, stepped into Debtor’s shoes, and began running the business
as if it belonged to them.”
(Id.)
Plaintiff contends that as all assets of Mr. Amaya’s business are
now in the hands of Amaya Tire Service and/or Ms. Amaya, that such property in
a third person’s hands should be “subject to levy to satisfy Plaintiff
Creditor’s judgment, and Plaintiff Creditor is entitled to entry of Judgment
against [Ms. Amaya] and Defendant Amaya Tire Service that all business assets
held by them are subject to levy” to satisfy the earlier judgment against them;
further, such assets “cannot be transferred until” Plaintiff’s judgment is
“satisfied in full.” (Motion, 11-12.)
In opposition, Defendants confusingly contend summary adjudication
should not be granted here because Mr. Amaya “does not have, nor has he ever
had an interest in Defendant Amaya Tire Service,” and “is simply an employee of
the corporation.” (Opposition, 8.) However, Mr. Amaya’s interests in Amaya Tire
Service is the wrong inquiry, as a creditor’s suit claim is merely concerned
with assets belonging to Mr. Amaya which were transferred to a third party,
here Ms. Amaya and/or Amaya Tire Service. Further, these contentions are
contradicted by the undisputed by the personal guarantee made by Mr. Amaya for Amaya
Tire Service’s Main Street location lease, where Mr. Amaya represented Amaya
Tire Service’s lease was also for his business purpose and his benefit. (PSS
¶¶51-52.)
Defendants also
contend,
“Defendant Marjorie Amaya procured
the equipment and created her own corporation and tire shop which ran out of
the same facility as MP Tires Inc. as she negotiated terms of lease at a new
location. The Plaintiff is simply attempting to enforce a judgment against
Defendant Marjorie Amaya and Amaya Tire Service for an action that they were
never included in.”
(Opp., 8.)
However, Defendants fail to explain what happened to those
business assets after MP Tire Service Inc, which Defendants incorrectly name as
“MP Tires Inc.,” was suspended in 2010 and after Mr. Amaya was awarded said
business assets after the dissolution of his marriage, as described above. The
fact Ms. Amaya and Amaya Tire Service were not involved in the earlier judgment
is exactly why they are seen as third parties here, and why a creditor’s suit
claim is brought against them.
In reply, Plaintiff correctly points out Defendants failed to file
a separate statement in opposition, and have failed to dispute any of the
contended material facts brought forth by Plaintiff. (Reply, 2.) Plaintiff
therefore correctly contends that such failure can constitute an admission of
all facts contained in the moving separate statement. (Id.; citing Thompson
v. Iaone (2017) 11 Cal.App.5th 1180, 1186, fn. 4.) Thus, citing Aguilar,
Plaintiff correctly explains that as Defendants have failed to dispute the
material facts in their opposition, “the Court need only find that Plaintiff
has made a prima facie showing that there are no triable issues of material
fact.” (Reply, 3.) Further, Plaintiff correctly points out Defendants’
statements in opposition contradict statements made by Mr. Amaya and Ms. Amaya
regarding ownership of assets and the chain of transfers of said assets.
(Reply, 7.)
Viewing the evidence submitted in the light most favorable to Defendants,
the court finds that Plaintiff has met their burden of making a prima facie
showing that third parties, here Ms. Amaya and/or Amaya Tire Service, are in
possession or control of personal properties in which Plaintiff Creditor has an
interest after the entrance of judgement in their favor on their
Cross-Complaint against Mr. Amaya. Therefore, Plaintiff has shown entitlement
to summary adjudication as to the fourth cause of action in subjecting the
aforementioned business assets to levy to satisy Plaintiff Creditor’s judgment
and to prohibit transfer of any such business assets until Plaintiff’s judgment
is satisfied in full.
For these reasons, Plaintiff’s motion is granted as to the fourth
cause of action.
B.
Second and Third Issues: Second
& Third Causes of Action
“A fraudulent conveyance claim is set forth in the Uniform
Fraudulent Transfer Act (UFTA), which is codified in Civil Code section 3439 et
seq. A fraudulent conveyance is a transfer by the debtor of property
to a third person undertaken with the intent to prevent a creditor from
reaching that interest to satisfy its claim.” (Kirkeby v.
Superior Court (2004)
33 Cal.4th 642, 648 (Kirkeby), internal
quotation marks omitted.)
A claim for fraudulent transfer requires a showing that: (1)
transfer was made, or obligation incurred by a debtor; (2) with actual intent
to hinder, delay, or defraud any creditor of debtor; (3) without receiving a
reasonably equivalent value in exchange for the transfer or obligation; and (4)
resulting injury to creditor. Civil Code §§ 3439,
et seq.; 3439.04(a), 3439.05; 8 Witkin Cal. Pro. (5th ed. 2008) Enforcement of Judgment
§§495-98. See also Filip v. Bucurenciu (2005) 129 Cal. App. 4th 825, 834 ("There
is no minimum number of factors that must be present before the scales tip in
favor of finding of actual intent to defraud."); Kirkeby v. Sup. Ct. (2004) 33 Cal. 4th 642, 651 (fraudulent
transfer was sufficiently alleged based on defendant’s transfer of property
with the intent to defraud, hinder or delay creditors in collection); Annod Corp. v.
Hamilton & Samuels (2002) 100 Cal. App. 4th 1286, 1298 (proof of
fraudulent intent in conveyances often is inferences from the surrounding
circumstances); Civ. Code §§ 3439.07(a)(1), 3439.08(a) (fraudulent transfers may be avoided as against
transferees who did not take property in good faith for adequate
consideration); Jhaveri v. Teitelbaum (2009) 176 Cal.App.4th 740,
755 (UFTA is merely cumulative of other remedies and not exclusive); Mehrtash v. Mehrtash
(2001) 93 Cal.App.4th 75, 80 (“‘It cannot be said that a creditor has
been injured unless the transfer puts beyond [her] reach property [she]
otherwise would be able to subject to the payment of [her] debt.’”); Mejia
v. Reed (2003) 31 Cal.4th 657, 664 (“Under the UFTA, a transfer is
fraudulent, both as to present and future creditors, if it is made ‘[w]ith actual intent to
hinder, delay, or defraud any creditor of the debtor.’ ”); Renda v.
Nevarez (2014) 223 Cal.App.4th 1231, 1238 (“The UFTA does not
impose on the debtor any liability additional to or distinct from the existing
claim of the creditor; it simply allows the creditor to obtain ‘[a]voidance of
the transfer ... to the extent necessary to satisfy the creditor's claim.’
”); ibid at 1237 (“to the extent a transfer is voidable,
‘the creditor may recover judgment’ for the lesser of the value of the asset or
the amount needed to satisfy the creditor's claim, and the ‘judgment may be
entered’ against the person for whose benefit the transfer was made.”); Monastra
v. Konica Business Machines, U.S.A., Inc. (1996) 43 Cal.App.4th 1628, 1645 (“A constructive trust plainly is a proper remedy” for a
fraudulent transfer claim.);
Fidelity Nat. Title Ins. Co. v. Schroeder (2009) 179 Cal.App.4th 834, 850 (resulting trust is a
cognizable remedy as an alternative to fraudulent transfer).
“...[E]very
transfer of personal property made by a person having at the time the
possession of the property, and not accompanied by an immediate delivery
followed by an actual and continued change of possession of the property, is
void as against the transferor's creditors (secured or unsecured) at the time
of the transfer and those who become creditors while the transferor remains in
possession and the successors in interest of those creditors, and as against
buyers from the transferor for value in good faith subsequent to the transfer.”
(Civ. Code § 3440, et seq.)
Here, Plaintiff contends the evidence shows “no actual
transfer of [Mr. Amaya’s] Business to either [Ms. Amaya] or Defendant Amaya
Tire Service ever occurred. Instead...” the name of Mr. Amaya’s business was
changed and Ms. Amaya continued operating it in the same manner. (Motion, 12.) In
the alternative, Plaintiff contends that if the court even finds a transfer
took place, “any transfer was not accompanied by any delivery or change of
possession.” (Id.) Plaintiff again points to Mr. Amaya’s personal
guarantee made as part of the Main Street location for Amaya Tire Service and
emphasizes Ms. Amaya’s admission that no consideration was given for any
transfer of business assets. (Motion, 12-13.)
Plaintiff also points to the multifactor analysis of Civil Code
§ 3439.04 to make a
prima facie showing of intent to defraud Plaintiff Creditor. (Motion, 13.)
Those factors include: an alleged transfer to an insider, here Mr. Amaya’s
daughter; no changing of hands for any business assets and the continued
working of Mr. Amaya; lack of disclosure of any transfer to Plaintiff Creditor;
the transfer being for the entirety of Mr. Amaya’s assets; the admission that
no consideration was given in exchange; and the resulting insolvency of Mr.
Amaya after the alleged transfer. (Motion, 13-14.) Plaintiff also explains that
the transfer was made without Mr. Amaya receiving any reasonably equivalent
value in return, and the alleged insolvency of Mr. Amaya is another factor
which leans towards a prima facie showing of a claim under Civil
Code S§ 3439.04 and 3439.07.
(Id.)
As discussed above, while
Defendants attempt to make contradictory statements in their opposition, their
failure to dispute any material facts in an opposing separate statement
constitutes admission of those facts. (Reply, 4-5.) Further, while Defendants
contend that no concealment of any transfer took place and dispute any
inference of an intent to defraud Plaintiff Creditor, Plaintiff correctly
explains “[Ms. Amaya] paid no consideration for [Mr. Amaya’s] business, has no
documents reflecting the transfer of a single asset, and instead simply began
using [Mr. Amaya’s] business assets as if they were her own.” (Reply, 5-6.)
Viewing the evidence submitted
in the light most favorable to Defendants, the court finds Plaintiff has again
met their burden to make a prima facie showing of their entitlement to summary
adjudication as to the second and third causes of action. As discussed above,
Defendants’ opposition fails to dispute any material fact, and fails to counter
Plaintiff’s prima facie showing of their claims. Plaintiff successfully points
to a multitude of factors showing not only an inference of intent to defraud
Plaintiff or hinder Plaintiff Creditor’s satisfaction of judgment, but also a
fraudulent or voidable transfer entirely as defined by Civil Code §§ 3439, et seq.
and 3440.
For these reasons, Plaintiff’s
motion is granted as to the second and third causes of action.
C.
First Cause of Action: Declaratory
Relief
Pursuant to CCP § 1060, any person interested under a
contract may, ““in cases of actual controversy relating to the legal rights and
duties of the respective parties,” bring an action for a declaration of his or
her rights.¿“‘It is clear that declaratory relief may be
asked for alone or with other relief…that the mere fact that the¿contract has
already been breached and a cause of action therefor (one of the traditional
remedies) has accrued, does not necessarily deprive the court of the power to
grant declaratory relief under the law.’” (Bertero¿v.
Nat’l General Corp.¿(1967) 254 Cal.App.2d 126, 136 [quoting¿Ermolieff¿v.
R.K.O. Radio Pictures¿(1942) 19 Cal.2d 543, 547].)¿“The actual controversy
language in section 1060¿encompasses a probable future controversy relating to
the legal rights and duties of the parties that is ‘ripe’ when it has reached,
but has not passed, the point that the facts have sufficiently congealed to
permit an intelligent and useful decision to be made.” (TransparentGov¿Novato
v. City of Novato¿(2019) 34 Cal.App.5th 140, 148 [internal citations
omitted, emphasis in original].)¿
CCP § 187 provides that “[w]hen jurisdiction is, by the
Constitution or this Code, or by any other statute, conferred on a Court or
judicial officer, all the means necessary to carry it into effect are also
given; and in the exercise of this jurisdiction, if the course of proceeding be
not specifically pointed out by this Code or the statute, any suitable process
or mode of proceeding may be adopted which may appear most conformable to the
spirit of this Code.” “Pursuant to its authority under section 187, the
trial court may amend a judgment to add a judgment debtor.” (Favila v.
Pasquarella (2021) 65 Cal.App.5th 934, 942.)
“‘As a general rule, a court may amend its judgment at any
time so that the judgment will properly designate the real defendants . . .. Judgments may be amended to add additional judgment
debtors on the ground that a person or entity is the alter ego of the original
judgment debtor . .
. . Amendment of a judgment to
add an alter ego is an equitable procedure based on the theory that the court
is not amending the judgment to add a new defendant but is merely inserting the
correct name of the real defendant. [Citation.] In addition, even
if all the formal elements necessary to establish alter ego liability are not
present, an unnamed party may be included as a judgment debtor if the equities
overwhelmingly favor the amendment and it is necessary to prevent an injustice.’” (Favila,
supra, 65 Cal.App.5th at 942 (quoting Carolina Casualty Ins. Co. v. L.M.
Ross Law Group, LLP (2012) 212 Cal.App.4th 1181, 1188-89).)
Here,
Plaintiff seeks a declaratory judgment “that Defendants are a single enterprise
and/or alter egos for the purposes of enforcing the Judgment, and seeks a
judgment amending Plaintiff Creditor’s Judgment to add [Ms. Amaya} and
Defendant Amaya Tire Service as additional judgment debtors.” (Motion, 14-15.) Plaintiff
cites to CCP § 187 and Favila v.
Pasquarella in support of this claim. (Id.) However, section 187 and
Favila empower a court to amend “its” own previously entered judgment,
and do not entrust a separate Department of this court to amend the previously
entered judgment and/or order of another. Further, as this court already
granted summary adjudication as to the second, third, and fourth causes of
action, the court has already voided any alleged transfer of business assets
and has already granted summary adjudication in subjecting said assets to a
levy, as well as prohibiting the transfer of said assets until satisfaction of
Plaintiff’s judgment. Therefore, the court finds no declaration of rights are
needed as no further controversy exists at this time. Lastly, the court finds Plaintiff
has failed to explain how a finding of alter ego liability can be established
under this claim.
If Plaintiff seeks to amend the
prior judgment on its Cross-Complaint, the court reminds Plaintiff it can make
a motion to amend such judgment with the assigned Department.
Thus, the court finds the first
cause of action is moot.
For these reasons, Plaintiff’s motion is denied as to the first
cause of action.
Conclusion
Plaintiff’s motion is denied as to the first cause of action.
It is otherwise granted. Plaintiff is to give notice.