Judge James C. Chalfant, Case 21STCV33893 2022-08-11 Tentative Ruling

John Deere Construction & Forestry Company v. Luis Arias, 21STCV33893

Tentative decision on application for writ of possession: granted

Plaintiff John Deere Construction & Forestry Company (“John Deere”) seeks a writ of possession against Defendant Luis Vivas Arias (“Arias”) to recover four pieces of industrial machinery (collectively, the “Equipment”).

The court has read and considered the moving papers and supplemental papers (no opposition was filed) and renders the following tentative decision.

Plaintiff John Deere filed the Complaint on September 3, 2021, alleging five counts each of (1) breach of contract and (2) claim and delivery. The Complaint alleges that over the years, Arias has entered into agreements (“Agreements”) for the purchase of equipment, including (1) a John Deere 17G Compact Excavator ID# 1FF017GXHH227381, including 12”, 18”, 24” Buckets; (2) a John Deere 50G Compact Excavator ID# 1FF050GXLJH288260, including PT & HYD, Extended warranty, JD thumb, wedgelock clpr, 30“Bkt36”bk; (3) a 85G Excavator ID# 1FF085GXAKJ020693; (4) a 17GX Compact Excavator ID# lFF017GXKKK229547, including 12”, l8”, & 24” buckets, with extended warranty 60 month/3000 hours: and (5) a 17GX Compact Excavator ID# 1FF017GXJKK228692, including PT & HYD 36MO/2000HR and 12”, l8”, & 24” buckets.

Between December 2020 and July 2021, Arias defaulted on the Agreements and has not made payments since. The total amount owed under the Agreements is $13,180.28, $33,422.07, $92,749.71, $23,105.57, and $21,397.32, respectively. John Deere seeks damages in these amounts, immediate possession of all equipment, and attorney’s fees and costs.

On October 31, 2021, Plaintiff John Deere personally served Defendant Arias with the Complaint and Summons.

On December 21, 2021, Plaintiff John Deere filed a request for entry of default against Arias. Department 17 (Hon. Jon R. Takasugi) entered the default on December 28, 2021.

On April 12, 2022, John Deere applied ex parte for a writ of possession to recover the Equipment. The court denied the ex parte application on April 13, 2022 for lack of a showing of emergency and lack of a payment history.

John Deere filed a notice motion for writ of possession set for hearing on July 7, 2022. At the hearing, the court continued the unopposed matter for John Deere to provide supporting documents showing the amount owed and the defendant’s interest for purposes of an undertaking.

A writ of possession is issued as a provisional remedy in a cause of action for claim and delivery, also known as replevin. See Pillsbury, Madison & Sutro v. Schectman, (1997) 55 Cal.App.4th 1279, 1288. As a provisional remedy, the right to possession is only temporary, and title and the right to possess are determined in the final judgment.

A writ of possession is available in any pending action. It also is available where an action has been stayed pending arbitration, so long as the arbitration award may be ineffectual without provisional relief. See CCP §1281.7.

Upon the filing of the complaint or at any time thereafter, a plaintiff may apply for an order for a writ of possession. Unlike attachment, where Judicial Council forms are optional, the parties must use the mandatory approved Judicial Council forms in a claim and delivery proceeding. (Judicial Council Forms CD-100 et seq.).

A plaintiff must make a written application for a writ of possession. CCP §512.010(a), (b); (Mandatory Form CD-100); CCP §512.010(a). A verified complaint alone is insufficient. 6 Witkin, California Procedure, (5th ed. 2008) §255, p.203. The application may be supported by declarations and/or a verified complaint. CCP §516.030. The declarations or complaint must set forth admissible evidence except where expressly permitted to be shown on information and belief. Id.

The application must be executed under oath and include: (1) A showing of the basis of the plaintiff's claim and that the plaintiff is entitled to possession of the property claimed. If the plaintiff's claim is based on a written instrument, a copy of it must be attached; (2) A showing that the property is wrongfully detained by the defendant, how the defendant came into possession of it, and, the reasons for the detention based on the plaintiff’s best knowledge, information, and belief; (3) A specific description of the property and statement of its value; (4) The location of the property according to the plaintiff’s best knowledge, information, and belief. If the property, or some part of it, is within a private place which may have to be entered to take possession, a showing of probable cause to believe that the property is located there; and (5) A statement that the property has not been taken for (a) a tax, assessment, or fine, pursuant to a statute, or (b) an execution against the plaintiff’s property. Alternatively, a statement that if the property was seized for one of these purposes, it is by statute exempt from such seizure. CCP §512.010(b).

Before noticing a hearing, the plaintiff must serve the defendant with all of the following: (1) A copy of the summons and complaint; (2) A Notice of Application and Hearing; and (3) A copy of the application and any supporting declaration. CCP §512.030(a). If the defendant has not appeared in the action, service must be made in the same manner as service of summons and complaint. CCP §512.030(b).

Each party shall file with the court and serve upon the other party any declarations and points and authorities intended to be relied upon at the hearing. CCP §512.050. At the hearing, the court decides the merits of the application based on the pleadings and declarations. Id. Upon a showing of good cause, the court may receive and consider additional evidence and authority presented at the hearing, or may continue the hearing for the production of such additional evidence, oral or documentary, or the filing of other affidavits or points and authorities. Id.

The court may order issuance of a writ of possession if both of the following are found: (1) The plaintiff has established the probable validity of the plaintiff’s claim to possession of the property; and (2) The undertaking requirements of CCP section 515.010 are satisfied. CCP §512.060(a). “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 §511.090. This requires that the plaintiff establish a prima facie case; the writ shall not issue if the defendant shows a reasonable probability of a successful defense to the claim and delivery cause of action. Witkin, California Procedure, (5th ed. 2008) §261, p.208. A defendant’s claim of defect in the property is not a defense to the plaintiff’s right to possess it. RCA Service Co. v. Superior Court, (1982) 137 Cal.App.3d 1, 3.

No writ directing the levying officer to enter a private place to take possession of any property may be issued unless the plaintiff has established that there is probable cause to believe that the property is located there. CCP §512.060(b).

The successful plaintiff may obtain a preliminary injunction containing the same provisions as a TRO that remains in effect until the property is seized by the levying officer.[1] CCP §513.010(c).

The court may also issue a “turnover order” directing the defendant to transfer possession of the property to the plaintiff (See Mandatory Form CD-120). The order must notify the defendant that failure to comply may subject him or her to contempt of court. CCP §512.070. The turnover remedy is not issued in lieu of a writ, but in conjunction with it to provide the plaintiff with a less expensive means of obtaining possession. See Edwards v Superior Court, (1991) 230 Cal.App.3d 173, 178.

Generally, the court cannot issue an order for a writ of possession until the plaintiff has filed an undertaking with the court (Mandatory Form CD-140 for personal sureties). CCP §515.010(a). The undertaking shall provide that the sureties are bound to the defendant for the return of the property to the defendant, if return of the property is ordered, and for the payment to the defendant of any sum recovered against the plaintiff. Id. The undertaking shall be in an amount not less than twice the value of the defendant's interest in the property or in a greater amount. Id. The value of the defendant's interest in the property is determined by the market value of the property less the amount due and owing on any conditional sales contract or security agreement and all liens and encumbrances on the property, and any other factors necessary to determine the defendant’s interest in the property. Id.

However, where the defendant has no interest in the property, the court must waive the requirement of the plaintiff’s undertaking and include in the order for issuance of the writ the amount of the defendant’s undertaking sufficient to satisfy the requirements of CCP section 515.020(b). CCP §515.010(b).

The parties entered into the Agreements for the Equipment consisting of (1) a John Deere 17G Compact Excavator on December 15, 2017, (2) a John Deere 50G Compact Excavator on August 15, 2018, (3) a 85G Excavator on August 30, 2019, and (4) a 17GX Compact Excavator on December 30, 2019. Johnson Supp. Decl., ¶4, Ex. A. Under Paragraph 5 of each Agreement, John Deere was granted a security interest in the Equipment. Johnson Supp. Decl., ¶5, Ex. A. John Deere perfected its security interest in each piece of the Equipment by filing a UCC-1 with the Secretary of State. Johnson Supp. Decl., ¶5, Ex. B. Each Agreement also permitted John Deere to accelerate the balance due upon default and entitled John Deere to repossess the Equipment. Johnson Supp. Decl., ¶¶ 6, 9, Ex. A.

On July 13, 2021, Arias defaulted on all four Agreements. John Supp. Decl., ¶7. John Deere accelerated the account balances and his total debt is $167,739.94. Johnson Supp. Decl., ¶7, Ex. C. The wholesale value of the Equipment totals $136,600 and the retail value totals $163,920. Johnson Supp. Decl., ¶8, Ex. D.

Paragraph 7 of each Agreement required Arias to maintain insurance on the Equipment. Johnson Supp. Decl., ¶10, Ex. A. Arias has failed to maintain the required insurance on the Equipment, thereby risking that its value will become substantially impaired. Johnson Supp. Decl., ¶10. Additionally, the Equipment is not essential to Arias’ livelihood as it is widely available, and John Deere has seen him use it in his pool construction business. Dunning Supp. Decl., ¶5; Johnson Supp. Decl., ¶10.

On December 17, 2021, John Deere’s counsel, Donald Dunning, Esq. (“Dunning”), called Arias to discuss return of the Equipment or payment. Dunning Supp. Decl., ¶4. Dunning expressed John Deere’s willingness to consider a payment proposal, which Arias said he would consider and get back to Dunning. Dunning Supp. Decl., ¶4. Despite followup emails and a telephone call, Arias did not respond. Dunning Supp. Decl., ¶4, Ex. A.

On April 13, 2022, the court heard an ex parte application for writ of possession for the same property. Dunning Supp. Decl., ¶6. The court denied the application for failure to show that the Equipment would be moved or concealed. Dunning Supp. Decl., ¶6.

Arias’ address on the Agreements and on the UCC-1s is 1300 W 37th Plaza, Los Angeles CA 90007 (“Arias’ Property”). Johnson Supp. Decl., ¶¶ 4-5, Exs. A-B. Since the time of default, John Deere has successfuly repossessed a fifth piece of equipment. Johnson Supp. Decl., ¶9. Although Arias claimed John Deere would never find the rest, GPS data shows that the Equipment is either at 537 N. Western Ave., Los Angeles, CA 90004, or at 999-901 Wilcox Ave, Los Angeles, CA 90038. Johnson Supp. Decl., ¶9. John Deere has filed an undertaking of $136,600.

Plaintiff John Deere seeks a writ of possession against Arias to recover the four pieces of Equipment. Arias is in default and does not oppose.

John Deere presents evidence that Arias entered into the Agreements to finance the purchase of the Equipment, giving John Deere a security interest in each piece of Equipment until receipt of all amounts due under each Agreement. Johnson Supp. Decl. ¶5, Ex. A. John Deere perfected its interest by providing the UCC-1 for each piece of Equipment. Johnson Supp. Decl., ¶5, Ex. B. The Agreements entitled John Deere to accelerate the amount owed and to repossess each piece of Equipment upon default. Johnson Supp. Decl., ¶¶ 6, 9, Ex. A. Arias defaulted on all four Agreements in the middle of 2021, and now owes a total of $167,739.94. Johnson Supp. Decl., ¶7, Ex. C. Demands for return of at least one of the pieces of Equipment have failed, with Arias claiming that John Deere will never find the rest. Dunning Decl., ¶4, Ex. A; Johnson Supp. Decl., ¶9.

Although John Deere has filed an undertaking of $136,600, it did not have to do so. Mem. at 4. John Deere has presented evidence that the maximum value of the Equipment is $163,920, almost $4,000 less than what Arias owes. Johnson Supp. Decl., ¶¶ 7-8, Exs. C-D. Because the amount he owes exceeds the value of the Equipment, Arias has no legal interest in it. CCP §515.010(a). The need for an undertaking is therefore waived.

John Deere has GPS data showing that the Equipment is either at 537 N. Western Ave., Los Angeles, CA 90004, or at 999-901 Wilcox Ave, Los Angeles, CA 90038. Johnson Supp. Decl., ¶9. Based on the Agreements and UCC-1s, neither location is Arias’ private property. Johnson Supp. Decl., ¶¶ 4-5, Exs. A-B. Even if it is, the GPS data is probable cause. See CCP §512.060(b).

[1] If the court denies the plaintiff’s application for a writ of possession, any TRO must be dissolved. CCP §513.010(c).