Judge James C. Chalfant, Case 22STLC06973 2023-02-02 Tentative Ruling

Santander Consumer, USA Inc. v. Robert Joyce and Department of Motor Vehicles, 22STLC06973

Tentative decision on application for writ of possession against (1) Department of Motor Vehicles and (2) Robert Joyce: granted

Plaintiff Santander Consumer, USA Inc. (“Santander”) seeks a writ of possession against Defendants Robert Joyce (“Joyce”) and the California Department of Motor Vehicles (“DMV”) to recover a 2018 Nissan Altima, VIN 1N4AL3AP3JC248855 (“Vehicle”).

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

Plaintiff Santander commenced this proceeding on October 19, 2022, alleging causes of action for (1) claim and delivery; (2) conversion; (3) quiet title; and (4) declaratory relief. The Complaint alleges in pertinent part as follows.

Prior to the commencement of this action, Gail Rusas (“Rusas”) entered into a contract to purchase the Vehicle (“Agreement”). Seller Cerritos Nissan (“Seller”) then assigned the Agreement to Santander. Pursuant to the Agreement, Rusas was to pay 72 monthly installments of $499.76 beginning December 9, 2021. The Agreement required that Rusas provide Seller, and therefore Santander, with a security interest in the Vehicle and right to immediate possession should Rusas default.

On December 9, 2021 and thereafter, Rusas failed to pay the required monthly installment. He now owes $24,277.49 plus other charges provided for in the Agreement.

Rusas has transferred the Vehicle to Joyce for repairs and storage where Santander believes that Rusas has accrued $4,700 in unpaid labor, tow, and storage fees. Joyce has applied to the DMV for approval to conduct a lien sale, which Santander opposes. Joyce has confirmed he still has the Vehicle, but demands for him to return it to Santander have failed.

Santander seeks recovery of the Vehicle or the value thereof, a writ of possession directing Defendants to transfer the Vehicle to Santander, $16,918 plus interest for damages for conversion, punitive damages, declaratory judgment that Santander is the legal owner, $1,750 in attorney’s fees against Joyce, and other attorney’s fees and costs.

On October 20, 2022, Santander personally served Defendant DMV with the Complaint and Summons.

On December 22, 2022, Santander served Defendant Joyce with the Complaint, Summons and moving papers by substitute service, effective January 1, 2022.

On January 17, 2022, Department 26 (Hon. Mark Windham) ordered Defendant DMV excused from future proceedings pursuant to a stipulation whereby it agreed to abide by any determination of the court as to transfer of Vehicle title, provided that all parties with an interest receive proper notice of the action.

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).

On October 25, 2021, Rusas entered into the Agreement with Seller to purchase the Vehicle, the cash price of which was $20,100. Jaimes Decl., ¶5, Ex. A. Pursuant to the Agreement, Rusas was required to pay 72 monthly installments of $499.76 from December 9, 2021 to November 9, 2027, a total of $35,982.72 after the down payment. Jaimes Decl., ¶5, Ex. A. The Agreement required that the Vehicle title reflects that Seller has a security interest in the Vehicle. Jaimes Decl., ¶5, Ex. A. In the event of Rusas’ default, the Agreement gave Seller the right to assess late charges, accelerate the amount owed, repossess the Vehicle peacefully, and sell it to apply the sale price less expenses to the amount owed under the Agreement. Jaimes Decl., ¶¶ 5, 7, Ex. A.

Seller assigned the Agreement to Santander, including the rights, title, and security interest in the Vehicle. Jaimes Decl., ¶5, Ex. A. The certificate of title for the Vehicle reflects Santander’s interest as lienholder. Jaimes Decl., ¶5, Exs. A-B.

On December 20, 2021 and thereafter, Rusas defaulted on the Agreement by failing to pay the required monthly installment. Jaimes Decl., ¶6, Ex. C. Santander assessed (1) late charges of $24.98 per month from December 2021 to April 2022, and (2) a $75 recovery fee in May 2022 to generate an Assessed Condition Report. Jaimes Decl., ¶6, Ex. C. As of July 14, 2022, the total amount owed is $24,277.49. Jaimes Decl., ¶6, Ex. C. Due to the default, Santander obtained the right to immediate possession of the Vehicle. Jaimes Decl., ¶7.

Before Santander commenced this action, Rusas transferred the Vehicle to Joyce for repairs and storage. Jaimes Decl., ¶¶ 8, 10, Ex. D. Rusas has accrued over $4,700 in unpaid storage fees to Joyce. Jaimes Decl., ¶¶ 8, 10, Ex. D. Rusas has passed away. Jaimes Decl., ¶¶ 9, 12, Ex. E.

Joyce has applied to the DMV for approval to conduct a lien sale and provided notice to Santander, which has opposed the sale. Jaimes Decl., ¶10, Ex. D. The notice of pending lien sale lists Joyce’s address as 14545 Dalwood Street, Norwalk, CA 90650 (“Joyce’s Address”). Jaimes Decl., ¶¶ 10, 17, Ex. D. The notice further states that the unpaid fees as of the notice totaled $4,700 in storage at the rate of $100 per day. Jaimes Decl., ¶10, Ex. D.

Before commencing this action, Santander confirmed that Joyce still has the Vehicle. Jaimes Decl., ¶11. On October 21, 2022, Santander sent a letter demanding return of the Vehicle. Jaimes Decl., ¶12, Ex. E. The letter asserted that Santander owed nothing under Civil Code sections 3068 and 3068.1 because Joyce was not an automotive repair dealer or licensed storage facility. Jaimes Decl., ¶12, Ex. E. Santander still offered to pay the $1,250 Joyce would have been entitled to as a repair/storage facility. Jaimes Decl., ¶12, Ex. E. Joyce rejected the offer and to date has failed to return the Vehicle. Jaimes Decl., ¶¶ 12, 14, 16.

As of October 2022, the N.A.D.A. Auto Market Report lists the average wholesale and retail values of the Vehicle as $16,250 and $18,775, respectively. Jaimes Decl., ¶13, Ex. F.[3] The Vehicle has not been taken as part of a tax, assessment, or fine to Santander’s knowledge. Jaimes Decl., ¶15. The Vehicle is currently located at Joyce’s Address. Jaimes Decl., ¶17, Ex. D.

Plaintiff Santander applies for a writ of possession for the Vehicle against Defendant Joyce. Although Santander has applied for the same writ against DMV, the DMV has agreed to any determination as to Vehicle possession provided that all concerned parties receive sufficient notice. The notice to Joyce was sufficient.

A person performing repairs has a lien on a vehicle for the services and for storage subject to limitations. Civil Code §3068(a). The lien arises after a written statement for charges is given to the vehicle’s registered owner or 15 days after the work or services are completed. Ibid.

A lien in excess of $1500 for work performed, and in excess of $1025 for any storage of the vehicle, is invalid unless written consent of the vehicle’s legal owner or lessor was obtained before the work was performed or the storage occurred. Civil Code §3068(c)(1). The term “legal owner” is defined as a person holding a security interest in a vehicle which is subject to UCC. Civil Code §3067; Vehicle Code §370. The lien shall be extinguished if the vehicle’s legal owner or lessor tenders, by cashier’s check or cash, the amount for storage, safekeeping, or parking space rental to which the lienholder is entitled under Civil Code section 3068(c).

The lien is extinguished unless the lienholder either applies to the DMV for an authorization to conduct the sale or files a court action within 30 days after the lien arises. Civil Code §3068(b)(1)(A). The lienholder shall apply to the DMV for authorization to conduct a liens sale for any vehicle with a value more than $4000. Civil Code §3071(a). For a vehicle valued at $4000 or less, the lienholder shall apply to the DMV for the names and addresses of the registered and legal owners and notify them of a pending lien sale. Civil Code §3071(a), (b). If the DMV receives a timely Declaration of Opposition form, it shall notify the lienholder within 16 days of receipt of the form that a lien sale shall not be conducted unless the lienholder files an action in court within 30 days of the DMV’s notice. Civil Code §3071(d). Any lien sale shall be void if the lienholder does not comply with this requirement. Civil Code §3071(l).

Santander presents evidence that Rusas entered into the Agreement to purchase the Vehicle, Seller assigned the Agreement to Santander, and the Agreement entitled Santander to accelerate the outstanding balance and repossess the Vehicle in the event of default. Jaimes Decl., ¶5, Ex. A. The certificate of title reflects Santander’s interest as lienholder, as the Agreement required. Jaimes Decl., ¶5, Exs. A-B.

Rusas was to pay 72 monthly installments of $499.76 from December 9, 2021 to November 9, 2027, for a total of $35,982.72 after the down payment. Jaimes Decl., ¶5, Ex. A. Santander’s payment history shows that Rusas defaulted on December 20, 2021 and thereafter for failure to pay the required monthly installment. Jaimes Decl., ¶6, Ex. C. It shows that the total amount owed is $24,277.49 after (1) late charges of $24.98 per month from December 2021 to April 2022, and (2) a $75 recovery fee in May 2022. Jaimes Decl., ¶6, Ex. C.

If Rusas defaulted within a month of his first payment and has not paid since, the amount owed should be over $35,000 before late charges. For this application, it suffices that the amount owed is at least $24,277.49. This is greater than the average $16,250 wholesale and $18,775 retail values of the Vehicle. Jaimes Decl., ¶13, Ex. F. In any case, Santander does not seek possession against the owner, as Rusas is deceased. Jaimes Decl., ¶¶ 9, 12, Ex. E. Whether Rusas estate has an ownership interest in the Vehicle is an issue not before the court.

Santander presents evidence that Joyce possesses the Vehicle. Jaimes Decl., ¶¶ 10, 17, Ex. D. Joyce’s notice asserts unpaid storage fees of $4,700, with $100 more accruing per day. Jaimes Decl., ¶10, Ex. D. Santander never authorized or consented to these charges before they were incurred as required by Civil Code section 3068(c)(1). Although Santander does not believe that Joyce is an automotive repair dealer or licensed storage facility, it offered Joyce the statutory maximum storage charges of $1,025, and he did not accept. Jaimes Decl., ¶12, Ex. E. His lien is therefore void. Civil Code §3068(c); Universal CIT Credit Corp. v. Rater, (1963) 214 Cal.App.2d 493, 495.

Santander presents evidence that the Vehicle is at 14545 Dalwood Street, Norwalk, CA 90650, which is Joyce’s address on the notice of pending lien sale. Jaimes Decl., ¶¶ 10, 17, Ex. C.

Santander has shown all the required facts for a writ of possession against Joyce. Joyce has no legal interest in the Vehicle, so no undertaking is required. CCP §515.010(b).

The application for a writ of possession is granted. A levying officer may enter Joyce’s Address of 14545 Dalwood Street, Norwalk, CA 90650 to seek possession of the Vehicle. Santander has not submitted an order for writ of possession and must do so in two court days or it will be waived.

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

[2] The declarations attached to each of the applications are identical.

[3] The declaration misquotes the average wholesale and retail values of the Vehicle on the report as $16,918 and $18,649, respectively. Jaimes Decl., ¶13.