Judge: Gary I. Micon, Case: 23CHCP00410, Date: 2024-03-18 Tentative Ruling

Case Number: 23CHCP00410    Hearing Date: March 18, 2024    Dept: F43

Dept. F43

Date: 3-18-24

Case # 23CHCP00410, Western Progressive, LLC vs. 11671 Goleta St., Sylmar, CA 91342

Trial Date: N/A

MOTION FOR ORDER OF DISBURSEMENT OF FUNDS TO JONATHAN BARNES

MOVING PARTY: Jonathan Barnes  

RESPONDING PARTY: Unopposed  

RELIEF REQUESTED

Moving party requests that the Court disburse the funds deposited by Petitioner Western Progressive, LLC to him.

RULING: The motion for an order of disbursement of funds to Jonathan Barnes is denied without prejudice.   

SUMMARY OF ACTION

On October 5, 2023, Petitioner Western Progressive, LLC (“Petitioner”) filed a Petition and Declaration Regarding Unresolved Claims and Deposit of Undistributed Surplus Proceeds of Trustee’s Sale (the “Petition”). The Petition states that Petitioner is the trustee under the Deed of Trust as to real property located at 11671 Goleta St., Sylmar, CA 91342 (the “Property”). (Petition, ¶¶ 1-2.)

According to the Petition, the Deed of Trust was executed by Betty Jean Cooper, an unmarried woman (“Cooper”) on February 22, 2006 as trustor and such Deed of Trust was recorded on March 1, 2006. (Petition, ¶ 3.) The Property was subject to a trustee’s sale that occurred on March 29, 2023, in which the total sale price of the Property was $446,000.00. (Petition, ¶¶ 4-6.) There are surplus proceeds available from the trustee’s sale available to potential claimants in the amount of $151,637.97. (Petition, ¶ 7.) The Petition indicates that Petitioner has received two written claims from potential claimants but, after due diligence, has been unable to determine the priority of the written claims received by the trustee as to the trustee’s sale surplus proceeds. (Petition, ¶¶ 9-11.) The Petition states that $143,538.57 will be deposited with the Court. (Petition, ¶ 16(h).)

On October 6, 2023, the Court signed an order granting the Petition which indicated that: (1) Petitioner’s request for fees and costs in the amount of $7,664.40 was granted; and (2) Petitioner was ordered to deposit the funds in the amount of $143,538.57 with the Court and the Clerk of the Court shall accept the deposit. (10/06/23 Order.) The Court’s order also stated that “[u]pon depositing the funds with the Court, [Petitioner] is discharged of further responsibility for the disbursement of surplus funds in accordance Civil Code §2924j(c), and is excused from participating in any further proceedings and hearings in this matter.” (10/06/23 Order.)

On October 31, 2023, the Court issued a Notice of Hearing on Claims to Determine Disbursement of Surplus Funds on Deposit Pursuant to Civil Code sections 2924j(c) and (d), and such hearing was set for January 10, 2024.

On November 1, 2023, Claimant Jonathan Barnes (“Claimant”) filed the instant unopposed Motion for Order of Disbursement of Funds.

December 18, 2023, Claimant filed a Notice of Claim for Surplus Funds, which is substantially similar to the instant motion.

On January 10, 2024, the Court adopted its tentative ruling without hearing, and denied Claimant’s Notice of Claim for Surplus Funds without prejudice. (01/10/24 Minute Order.) The Court noted that Petitioner did not request a hearing or file any proof of deposit of funds with the Court. (01/10/24 Minute Order.) The Court ordered Petitioner to deposit the funds with the Court and stated that “[u]pon the deposit of the funds and proof of receipt of deposit to the court, Petitioner will be discharged, and the clerk will set the hearing for disbursement of surplus funds.” (01/10/24 Minute Order at pp. 1-2.) The Court stated that it acknowledged that the “claim for $175,834 [was] based on unpaid judgments, but [Claimant] must wait for any and all clams pending the hearing for disbursement.” (01/10/24 Minute Order at p. 2.) The Court noted that Claimant’s “ ‘motion’ . . . fail[ed] to address the liens of the other parties.” (01/10/24 Minute Order at p. 2.)

On January 11, 2024, Claimant served a Notice of Ruling as to the Court’s January 10, 2024 Order. Also, on January 11, 2024, this case was reassigned from the Honorable Stephen P. Pfahler to the Honorable Gary I. Micon sitting in Department F49 at Chatsworth Courthouse effective January 16, 2024.

On January 18, 2024, Petitioner filed and served a Notice of Completion of Deposit and Discharge, which indicates that Petitioner deposited surplus funds in the amount of $143,538.57 with the Court on October 30, 2023. Also, on January 18, 2024, Petitioner filed and served a Notice of Case Reassignment.

On March 11, 2024, Claimant filed a reply brief as to the motion and filed a request for judicial notice in support of the motion.

ANALYSIS

Request for Judicial Notice: Claimant requests that the Court take judicial notice of the Petition filed in this action by Petitioner. A court may take judicial notice of the court record. (People v. Moore (1997) 59 Cal.App.4th 168, 178.) “Although a court cannot take judicial notice of hearsay allegations in a court record, it can take judicial notice of the truth of facts asserted in documents such as orders, findings of fact and conclusions of law, and judgments.” (Starr v. Ashbrook (2023) 87 Cal.App.5th 999, 1014.) The request for judicial notice is granted.

Claimant submits a claim for $175,834.00 based on two prior judgments in LASC Case No. 20STCV22826 (the “Underlying Action”). Claimant argues that Cooper, along with her accomplice Christian Patrick Richards, Jr. (“Richards”), committed and continues to commit wrongful acts against Claimant. Claimant argues that Cooper transferred the Property to Richards on May 24, 2022 in order to avoid collection on a judgment involving Claimant and Cooper in the Underlying Action. Claimant contends that there are only two claimants—himself and Cooper—and all other liens have been satisfied.

Civil Code § 2924k provides as follows:

(a) The trustee, or the clerk of the court upon order to the clerk pursuant to subdivision (d) of Section 2924j, shall distribute the proceeds, or a portion of the proceeds, as the case may be, of the trustee’s sale conducted pursuant to Section 2924h in the following order of priority:

(1) To the costs and expenses of exercising the power of sale and of sale, including the payment of the trustee’s fees and attorney’s fees permitted pursuant to subdivision (b) of Section 2924d and subdivision (b) of this section.

(2) To the payment of the obligations secured by the deed of trust or mortgage which is the subject of the trustee’s sale.

(3) To satisfy the outstanding balance of obligations secured by any junior liens or encumbrances in the order of their priority.

(4) To the trustor or the trustor’s successor in interest. In the event the property is sold or transferred to another, to the vested owner of record at the time of the trustee’s sale.

(b) A trustee may charge costs and expenses incurred for such items as mailing and a reasonable fee for services rendered in connection with the distribution of proceeds from a trustee’s sale, including, but not limited to, the investigation of priority and validity of claims and the disbursement of funds. If the fee charged for services rendered pursuant to this subdivision does not exceed one hundred dollars ($100), or one hundred twenty-five dollars ($125) where there are obligations specified in paragraph (3) of subdivision (a), the fee is conclusively presumed to be reasonable.

(Civ. Code, § 2924k.)

In support of the motion, Claimant presents the declaration of his counsel, Harold Greenberg (“Greenberg”). Greenberg states that, on June 17, 2020, his law firm filed the Underlying Action on behalf of Claimant which names Cooper as a Defendant. (Greenberg Decl., ¶ 3.) Greenberg declares that, on July 6, 2022 and August 5, 2022, two Abstracts of Judgment were recorded on behalf of Claimant in the amount of $25,000.00 and $150,834.00. (Greenberg Decl., ¶ 4; Exhs. A-B.)

Initially, the Court finds that Claimant’s citations to Estate of Grigsby (1982) 134 Cal.App.3d 611 and Estate of Mitchell (1999) 76 Cal.App.4th 1378 are inapposite as neither case addressed the issue of disbursement of surplus funds in the context of Civil Code § 2924.

Moreover, the Court finds that the declaration of counsel is insufficient to warrant disbursement of funds. “In law and motion practice, factual evidence is supplied to the court by way of declarations.” (Calcor Space Facility, Inc. v. Superior Court (1997) 53 Cal.App.4th 216, 224.) Here, the declaration of Greenberg neither addresses the liens of the other parties nor articulates that Claimant is entitled to the funds pursuant to Civil Code § 2924k. Greenberg has not stated whether: (1) the costs and expenses of exercising the power of sale; or (2) the payment of obligations secured by the deed of trust have been paid. While the Court has taken judicial notice of the Petition and its accompanying attachments, the Court does not take judicial notice of hearsay allegations in its records under Starr v. Ashbrook, supra, 87 Cal.App.5th 999, 1014. The Petition and its attachment are hearsay. Although his motion is unopposed, Claimant has not presented sufficient evidence to warrant his request for disbursement of funds.

The motion is denied without prejudice.

Moving party to give notice.