Judge: Gary I. Micon, Case: 24CHCV01525, Date: 2025-05-01 Tentative Ruling

Case Number: 24CHCV01525    Hearing Date: May 1, 2025    Dept: F43

Dept. F43

Date: 05-01-25

Case # 24CHCV01525, Old Republic Surety Co. v. Prowalk Orthotics & Prosthetics, Inc., et al.

Trial Date: None set.

MOTION FOR A CHARGING ORDER AND ORDER FORECLOSING THE INTEREST CHARGING ORDER AND FOR THE JUDGMENT DEBTORS IN TWIN PARK INVESTMENT, LLC

MOVING PARTY: Plaintiff Old Republic Surety Company

RESPONDING PARTY: No response has been filed.

RELIEF REQUESTED

Order determining the membership interest of judgment debtors Sang C. Park aka Sean Sangchan Park, and Chun R. Park aka Iris C. Park in Twin Park Investment, LLC.

Order granting a charging order against the membership interest of the judgment debtors in Twin Park Investment, LLC.

Order foreclosing the charging order and directing the sheriff/marshal or a receiver appointed by the court to sell the membership interest at a public or private auction.

RULING: Motion is granted.

SUMMARY OF ACTION

On April 24, 2024, Plaintiff Old Republic Surety Company (Plaintiff) sued defendants Prowalk Orthotics & Prosthetics, Inc., Sang C. Park aka Sean Sangchan Park, and Chun R. Park aka Iris C. Park (Defendants) for breach of contract.  Plaintiff alleges that Defendants failed to indemnify Plaintiff from claims from the Center for Medicare & Medicaid Services for claims against Plaintiffs under a surety bond.  Defendants received excess payments from Medicare.  Medicare demanded reimbursement.  The claims against Defendants exceeded the penal sum of the $50,000 surety bond.  Plaintiff paid $50,000.00 demanded by Medicare and demanded restitution and indemnity from Defendants.  Defendants failed to make restitution.

On January 30, 2025, the court entered default judgment against Defendants in the amount of $80,260.04.

On June 20, 2023, Twin Park Investment, LLC filed a statement of information with the California Secretary of State which disclosed that defendants Sang C. Park, and Chun R. Park are members of the LLC.

Plaintiff now moves for the court to determine Sang Park and Chun Park’s ownership interest in Twin Park Investment, LLC and for a charging order against Sang Park and Chun Park’s membership interest in the LLC in order to satisfy the judgment.  No opposition has been filed.

REQUEST FOR JUDICIAL NOTICE

Plaintiff requests that the court take judicial notice of the following exhibits pursuant to Evid. Code, § 452, subds. (c), (d), (g), and (h):

·         Exhibit 1 - Judgement entered in this action;

·         Exhibit 2 - Statement of Information filed with the California Secretary of State on 6/20/2023;

·         Exhibit 3 - Deed to 11473 Oakford Lane, Northridge, CA recorded with the County Recorder; and

·         Exhibit 4 - Deed to the property at 435 S. La Fayette Park Pl. # 318 Los Angeles, CA 90057 recorded with the County Recorder.

The court grants Plaintiff’s request.

ANALYSIS

Legal Standard

Under Code of Civil Procedure section 708.310: “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 pursuant to Section 15907.3, 16504, or 17705.03 of the Corporations Code.”  (Code Civ. Proc., § 708.310.) 

Corporations Code section 17705.3, subdivision (a) provides “[o]n 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, § 17705.3.)   

“As used in Corporations Code section 17705.03, a ‘transferrable interest’ is ‘the right, as originally associated with a person’s capacity as a member, to receive distributions from a limited liability company in accordance with the operating agreement, whether or not the person remains a member or continues to own any part of the right.’  A ‘distribution’ is a ‘transfer of money or other property from a limited liability company to another person on account of a transferrable interest.”  (Rice v. Downs (2021) 73 Cal.App.5th 213 [citations omitted].)

Pursuant to Code of Civil Procedure section 708.320, subdivision (a), “[a] lien on a judgment debtor’s interest in a partnership or limited liability company is created by service of a notice of motion for a charging order on the judgment debtor and on . . . (2) all members or the limited liability company.”  (Code Civ. Proc., § 708.320, subd. (a).)

Plaintiff seeks a charging order against defendants Sang Park and Chun Park’s the membership interest in Twin Park Investment, LLC.  Plaintiff states a charging order is necessary so that defendants’ interest may be used to satisfy the unpaid balance on the judgment.

Plaintiff served its motion on both defendants, who have not appeared in this action, via mail at 733 South Manhattan Place, # 506, Los Angeles, CA 90005 and email on February 24, 2025.[1]  (Motion - Proof of Service, p. 23.)

Plaintiff argues that defendants Sang Park and Chun Park are members of Twin Park Investment LLC based on a statement of information that was filed with the California Secretary of State on June 20, 2023.  (Request for Judicial Notice, Exh. 2.)  The statement lists defendants “Sean Sangchan Park” and “Iris Chunran Park” as members of the LLC.  (Ibid.)  Defendants’ addresses are listed as 20756 Campania Lane, Northridge, CA 91326. (Ibid.)  The third member of the LLC, Devin Ryul Park, is not a debtor in this case.  However, Devin’s address matches the address where Plaintiff served its motion on defendants.  Twin Park Investment, LLC is the vested fee owner of 11473 Oakford Lane, Northridge, CA 91326 and 435 S. LaFayette Park Place # 318, Los Angeles, CA 90057.  (Declaration of Howard Goodman, p. 1:22-23, Exhs. 3, 4.)

Although it appears that the Iris and Sean Sangchan listed on the statement of information share common information with the defendants in this case, the addresses listed on the statement of information do not match the addresses that Plaintiff served.  However, because Devin shares a common address with defendants, this indicates that Iris and Sean Sangchan are the defendants in this case.

The court finds that defendants Sang Park and Chun Park are members of Twin Park Investment LLC with a transferrable interest in the LLC.

Therefore, the court grants Plaintiff’s motion for a charging order against the membership interest of the judgment debtors in Twin Park Investment LLC and directs the sheriff/marshal or a receiver appointed by the court to sell a public or private auctions such membership interest.

CONCLUSION

Plaintiff’s motion for a charging order and for the public or private sale of defendants Sang C. Park aka Sean Sangchan Park and Chun R. Park aka Iris C. Park’s membership interest in Twin Park Investment LLC is granted.

Plaintiff to give notice.