Judge: Gail Killefer, Case: BC666680, Date: 2023-08-09 Tentative Ruling

Case Number: BC666680    Hearing Date: August 9, 2023    Dept: 37

HEARING DATE:                 Wednesday, August 09, 2023

CASE NUMBER:                   BC666680

CASE NAME:                        Wael HH Awad, et al. v. Harry Nadjarian, et al.¿

MOVING PARTY:                 Defendants, Harry Nadjarian, Industrial Motor Power Corporation and IMP Energy Solutions, LLC

OPPOSING PARTY:             Plaintiffs, Wael HH Awad and Al Qastal Heavy Equipment and Spare Parts Trading

TRIAL DATE:                        Post-Judgment

PROOF OF SERVICE:           OK

PROCEEDING:                      Motion for Orders for Sale of Debtor’s Interest

OPPOSITION:                        None filed

REPLY:                                  None filed

TENTATIVE:                         Defendants’ Motion for Orders for Sale of Interest is granted. The court orders the sale of:

1)     The 40% Membership interest of Wael H.H. Awad in IMP Energy Solutions LLC; and

2)     50% interest of Wael H.H. Awad in the partnership with Harry Nadjarian described in paragraph 31 and the Tenth Cause of Action of the Plaintiffs' Complaint.

Background

This action arises in connection with the sale of Caterpillar (“CAT”) generators from Harry Nadjarian ("Nadjarian"), Industrial Motor Power Corporation ("IMP"), and IMP Energy Solutions, LLC ("IMPES") (collectively “Defendants”) to Al Qastal Heavy Equipment and Spare Parts Trading (“Al Qastal”) and its owner, Wael Awad (collectively “Plaintiffs”), in exchange for a forty percent (40%) stake in IMPES.

Plaintiffs allege the action involved the sale of twelve CAT generators, and claimed Defendants had breached their contract in stagnating IMPES. Defendants alleged that the present action involved only an agreement for the sale of six CAT generators, and Plaintiffs incorrectly sought to withdraw from IMPES and other unrelated partnerships between the parties.  

Plaintiffs filed their operative Complaint on June 28, 2017. Plaintiffs’ Complaint alleges ten causes of action: (1) fraud; (2) rescission based on Fraud in the inducement of a Contract (Cal. Civ. Code §1689(b)(1)); (3) rescission based on unilateral mistake (Cal. Civ. Code §1689(b)(1)); (4) recission based on mutual mistake (Cal. Civ. Code §1689(b)(1)); (5) rescission based on failure of consideration (Cal. Civ. Code §1689(b)(2), (4)); (6) breach of fiduciary duty against Nadjarian; (7) conversion; (8) dissolution of limited liability company (Cal. Corp. Code §17707.03) against IMPES; (9) accounting against IMPES; and (10) dissolution of partnership (Cal. Corp. Code §16801) against Nadjarian.  

On January 20, 2022, Plaintiffs failed to appear at the Final Status Conference, and trial documents were not filed pursuant to this department’s Trial Preparation Order. On January 25, 2022, Plaintiffs failed to appear at the Order to Show Cause set by the court, and the court instructed Defendants to prepare a proposed Order to Dismiss. On February 4, 2022, the court granted Defendants’ proposed order and dismissed Plaintiffs’ complaint with prejudice. 

On August 1, 2022, the court granted Defendants’ motion for attorney fees pursuant to CCP § 1717.  

Defendants moved for an order, pursuant to CCP § 708.310 and Corp. Code §§ 16502, 16504, 15907.03, and 17705.03: (1) Charging the Plaintiffs’ interest of Defendant IMPES and the partnership interest of Plaintiffs in partnership with Defendant Nadjarian, and (2) Orders for the sale of the same interests. On October 25, 2022, the court granted Defendant’s Motion for a Charging Order.

On May 2, 2023, Defendants moved for an Order for the Sale of the 40% of Membership interest of Wael H.H. Awad in IMP Energy Solutions LLC and 50% interest of Wael H.H. Awad in the partnership with Harry Nadjarian described in paragraph 31 and the Tenth Cause of Action of the Plaintiffs' Complaint.  The motion was unopposed.

request for JUDICIAL notice

The Court may take judicial notice of records of any court of record of the United States. (Evid. Code, § 452(d)(2).) However, the court may only judicially notice the existence of the record, not that its contents are the truth. (Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1565.) 

Defendants’ request judicial notice of its own file pursuant to Evid. Code § 452(d) of the Order granting Defendants’ Harry Nadjarian etc. filed on October 25, 2022, and attached as Exhibit A to this Motion.

Defendants’ request for judicial notice is granted.

Discussion

I.         Legal Standard

“If a money judgment is rendered against a partner or member but not against the partnership or limited liability company, the judgment debtor’s interest in the partnership or limited liability company may be applied toward the satisfaction of the judgment by an order charging the judgment debtor’s interest. . .” (CCP, § 708.310.) To obtain a right to the judgment debtor’s interest in a partnership or limited liability company, the judgment creditor may bring an application. “On application by a judgment creditor of a member or transferee, a court may enter a charging order against the transferable interest of the judgment debtor for the unsatisfied amount of the judgment. A charging order constitutes a lien on a judgment debtor’s transferable interest and requires the limited liability company to pay over to the person to which the charging order was issued any distribution that would otherwise be paid to the judgment debtor.” (Corp. Code, § 17705.03; See also Corp. Code, § 16504.)  

II.        Analysis

On October 25, 2022, this court granted Defendants’ motion to impose a charging order on the 40% of Wael H.H. Awad in IMPES, and the 50% interest of Wael H.H. Awad in the unnamed partnership described in ¶31 and the Tent Cause of Action of the Complaint.  On November 21, 2022, this Order was served on the Manager of IMPES, Nicholas Nadjarian, and the other partner of the unnamed partnership, Harry Nadjarian. 

As to date, Defendants have received no funds by reason of the Order, they now request this court for an Order for the sale of the 40% LLC interest of Wael H.H. Awad in IMPES and the 50% interest in the unnamed partnership described in paragraph 31 of the complaint.

Defendants assert that other members of IMPES have consented to the sale, and Mr. Nadjarian has consented to the foreclosure of Mr. Awad’s partnership interest. The court has the authority to order the sale of the charged interest in satisfaction of a debt. (See Hellman v. Anderson (1991) 233 Cal.App.3d 840, 849.

The court grants Defendants’ unopposed Motion.   

Conclusion

Defendants’ Monfor for Orders for Sale of Interest is granted. The court orders the sale of:

3)     The 40% Membership interest of Wael H.H. Awad in IMP Energy Solutions LLC; and

4)     50% interest of Wael H.H. Awad in the partnership with Harry Nadjarian described in paragraph 31 and the Tenth Cause of Action of the Plaintiffs' Complaint.