Judge: James C. Chalfant, Case: 23STCV24593, Date: 2024-01-04 Tentative Ruling

Case Number: 23STCV24593    Hearing Date: January 23, 2024    Dept: 85

Kevin Coronado v. Marvin Rodriguez and Yireh Holdings, 23STCV24593

 

Tentative decision on the application for a right to attach order: granted after supplementary analysis


 

 

           

            Plaintiff Kevin Coronado (“Coronado”) applies for a right to attach order against Defendant Yireh Holdings (“Yireh”) for $180,435.

            The court has read and considered the moving papers (no opposition was filed)[1] and renders the following tentative decision.

           

            A. Statement of the Case

            1. Complaint

            Plaintiff Coronado commenced this action against Defendants Yireh and Marvin Rodriguez (“Rodriguez”) on October 10, 2023, alleging (1) breach of note, (2) money lent, (3) two counts of account stated, (4) two counts of open book account, (5) two counts of unjust enrichment, (6) fraud, (7) breach of oral agreement, (8) money had and received, (9) conversion, and (10) violations of Business and Professions Code section 17200.  The unverified Complaint alleges in pertinent part as follows.

            Rodriguez is Yireh’s owner, President, Chief Executive Officer (“CEO”), Chief Financial Officer (“CFO”), Secretary, and sole director.  He would often commingle its funds and divert them for his personal use.

            On December 1, 2021, Coronado loaned Rodriguez and Yireh $180,000.  The note for this loan (“December 2021 Note”) required the borrower to make monthly payments of $1,800.  The December 2021 Note was due and payable upon completion of a construction project (“Project”) on two parcels of property at 4970 Gambier Street (“Gambier Property”) and 3100 Pueblo Avenue, Los Angeles, CA 90032 (“Pueblo Property”) (collectively, “Project Properties”).  Coronado was also entitled to recover reasonable attorney’s fees incurred in enforcing the December 2021 Note.

            In May 2023, Defendants sold one of the Project Properties.  Coronado would not have signed the December 2021 Note if he had known Defendants would sell the Project Properties without finishing the Project or paying off the December 2021 Note.  Defendants defaulted for failure to make the required monthly payments and pay off the December 2021 Note after they abandoned the Project.  As of October 2, 2023, Defendants owe the $180,000 principal, $33,000 in interest, and $3,300 in unpaid late fees.

            Rodriguez also agreed to sell Coronado 60 unlocked mobile phones for $37,200.  Coronado paid the $37,200, but Rodriguez has not delivered the unlocked phones.

            As to both Defendants, Coronado seeks (1) initial damages of $216,300, an additional $49.3150 per day from October 2, 2023, and attorneys’ fees and costs incurred in enforcing the December 2021 Note in this action; (2) $180,000 plus 10% annual interest from December 1, 2021; (3) punitive and exemplary damages; (4) restitution and disgorgement of all monies Coronado paid; and (5) a permanent injunction enjoining Defendants from engaging in unlawful business practices.  As to Rodriguez, Coronado also seeks $37,200, 10% annual interest thereon from August 15, 2023, and punitive and exemplary damages.  Coronado also seeks recovery of costs of suit.

 

            2. Course of Proceedings

            On November 7, 2023, Coronado personally served Yireh and Rodriguez with the Complaint, Summons, and moving papers.

 

            B. Applicable Law

            Attachment is a prejudgment remedy providing for the seizure of one or more of the defendant’s assets to aid in the collection of a money demand pending the outcome of the trial of the action.  See Whitehouse v. Six Corporation, (1995) 40 Cal.App.4th 527, 533.  In 1972, and in a 1977 comprehensive revision, the Legislature enacted attachment legislation (CCP §481.010 et seq.) that meets the due process requirements set forth in Randone v. Appellate Department, (1971) 5 Cal.3d 536.  See Western Steel & Ship Repair v. RMI, (12986) 176 Cal.App.3d 1108, 1115.  As the attachment statutes are purely the creation of the Legislature, they are strictly construed.  Vershbow v. Reiner, (1991) 231 Cal.App.3d 879, 882.


            A writ of attachment may be issued only in an action on a claim or claims for money, each of which is based upon a contract, express or implied, where the total amount of the claim or claims is a fixed or readily ascertainable amount not less than five hundred dollars ($500).  CCP §483.010(a).  A claim is “readily ascertainable” where the amount due may be clearly ascertained from the contract and calculated by evidence; the fact that damages are unliquidated is not determinative.  CIT Group/Equipment Financing, Inc. v. Super DVD, Inc., (2004) 115 Cal.App.4th 537, 540-41 (attachment appropriate for claim based on rent calculation for lease of commercial equipment).

            All property within California of a corporation, association, or partnership is subject to attachment if there is a method of levy for the property.  CCP §487.010(a), (b).  While a trustee is a natural person, a trust is not.  Therefore, a trust’s property is subject to attachment on the same basis as a corporation or partnership.  Kadison, Pfaelzer, Woodard, Quinn & Rossi v. Wilson, supra, 197 Cal.App.3d at 4.

            The plaintiff may apply for a right to attach order by noticing a hearing for the order and serving the defendant with summons and complaint, notice of the application, and supporting papers any time after filing the complaint.  CCP §484.010.  Notice of the application must be given pursuant to CCP section 1005, sixteen court days before the hearing.  See ibid.

            The notice of the application and the application may be made on Judicial Council forms (Optional Forms AT-105, 115).  The application must be supported by an affidavit showing that the plaintiff on the facts presented would be entitled to a judgment on the claim upon which the attachment is based.  CCP §484.030. 

             Where the defendant is a corporation, a general reference to “all corporate property which is subject to attachment pursuant to subdivision (a) of Code of Civil Procedure Section 487.010” is sufficient.  CCP §484.020(e).  Where the defendant is a partnership or other unincorporated association, a reference to “all property of the partnership or other unincorporated association which is subject to attachment pursuant to subdivision (b) of Code of Civil Procedure Section 487.010” is sufficient.  CCP §484.020(e).  A specific description of property is not required for corporations and partnerships as they generally have no exempt property.  Bank of America v. Salinas Nissan, Inc., (“Bank of America”) (1989) 207 Cal.App.3d 260, 268.

            A defendant who opposes issuance of the order must file and serve a notice of opposition and supporting affidavit as required by CCP section 484.060 not later than five court days prior to the date set for hearing.  CCP §484.050(e).  The notice of opposition may be made on a Judicial Council form (Optional Form AT-155). 

            The plaintiff may file and serve a reply two court days prior to the date set for the hearing.  CCP §484.060(c).

            At the hearing, the court determines whether the plaintiff should receive a right to attach order and whether any property which the plaintiff seeks to attach is exempt from attachment.  The defendant may appear the hearing.  CCP §484.050(h).  The court generally will evaluate the attachment application based solely on the pleadings and supporting affidavits without taking additional evidence.  Bank of America, supra, 207 Cal.App.3d at 273. A verified complaint may be used in lieu of or in addition to an affidavit if it states evidentiary facts.  CCP §482.040.  The plaintiff has the burden of proof, and the court is not required to accept as true any affidavit even if it is undisputed.  See Bank of America, supra, at 271, 273.


            The court may issue a right to attach order (Optional Form AT-120) if the plaintiff shows all of the following: (1) the claim on which the attachment is based is one on which an attachment may be issued (CCP §484.090(a)(1)); (2) the plaintiff has established the probable validity of the claim (CCP §484.090(a)(2)); (3) attachment is sought for no purpose other than the recovery on the subject claim (CCP §484.090(a)(3); and (4) the amount to be secured by the attachment is greater than zero (CCP §484.090(a)(4)).

            A claim has “probable validity” where it is more likely than not that the plaintiff will recover on that claim.  CCP §481.190.  In determining this issue, the court must consider the relative merits of the positions of the respective parties.  Kemp Bros. Construction, Inc. v. Titan Electric Corp., (2007) 146 Cal.App.4th 1474, 1484.  The court does not determine whether the claim is actually valid; that determination will be made at trial and is not affected by the decision on the application for the order.  CCP §484.050(b).

            Except in unlawful detainer actions, the amount to be secured by the attachment is the sum of (1) the amount of the defendant’s indebtedness claimed by the plaintiff, and (2) any additional amount included by the court for estimate of costs and any allowable attorneys’ fees under CCP section 482.110.  CCP §483.015(a); Goldstein v. Barak Construction, (2008) 164 Cal.App.4th 845, 852.  This amount must be reduced by the sum of (1) the amount of indebtedness that the defendant has in a money judgment against plaintiff, (2) the amount claimed in a cross-complaint or affirmative defense and shown would be subject to attachment against the plaintiff, and (3) the value of any security interest held by the plaintiff in the defendant’s property, together with the amount by which the acts of the plaintiff (or a prior holder of the security interest) have decreased that security interest’s value.  CCP §483.015(b); see also CCP §483.010(b) (“an attachment may not be issued on a claim which is secured by any interest in real property arising from agreement, statute, or other rule of law…However, an attachment may be issued where the claim was originally so secured but, without any act of the plaintiff or the person to whom the security was given, the security has become valueless or has decreased in value to less than the amount then owing on the claim).  A defendant claiming that the amount to be secured should be reduced because of a cross-claim or affirmative defense must make a prima facie showing that the claim would result in an attachment against the plaintiff.

            Before the issuance of a writ of attachment, the plaintiff is required to file an undertaking to pay the defendant any amount the defendant may recover for any wrongful attachment by the plaintiff in the action.  CCP §489.210.  The undertaking ordinarily is $10,000. CCP §489.220.  If the defendant objects, the court may increase the amount of undertaking to the amount determined as the probable recovery for wrongful attachment.  CCP §489.220.  The court also has inherent authority to increase the amount of the undertaking sua sponte.  North Hollywood Marble Co. v. Superior Court, (1984) 157 Cal.App.3d 683, 691.

           

            C. Statement of Facts

            1. Background

            Yireh’s sole business is to hold properties for resale.  Coronado Decl., ¶9.  Yireh’s Statement of Information lists Rodriguez as its CEO, CFO, Secretary, sole director, and agent for service of process.  Coronado Decl., ¶2, Ex. 1.  He is also its owner and President.  Coronado Decl., ¶2.

            Aside from the Pueblo Property, Yireh currently holds two parcels of property in Barstow, one in Victorville, and one in Pico Rivera.  Coronado Decl., ¶9, Exs. 6-8, 10-11.  It also owned property at 3265 Story St., Los Angeles, CA 90063 until Rodriguez sold it in October 2023.  Coronado Decl., ¶10, Ex. 9.

 

            2. Pre-Project Loans

            Coronado first loaned Rodriguez $30,000 in 2019.  Coronado Decl., ¶3.  He requested the loan be handled through escrow and secured by the property Rodriguez wanted to purchase with the money.  Coronado Decl., ¶3.  He later learned Rodriguez never recorded a deed of trust for the property, and Coronado insisted that he do so.  Coronado Decl., ¶3.  Rodriguez was angry about the request but eventually complied.  Coronado Decl., ¶3.  He repaid the loan two months later when he sold the property.  Coronado Decl., ¶3. 

            In 2020, Rodriguez requested Coronado to loan $50,000 so Yireh could purchase property at 3810 Locke Avenue (“Locke Property”) for investment purposes.  Coronado Decl., ¶4.  Rodriguez told Coronado this loan would be secured by a deed of trust on the Locke Property.  Coronado Decl., ¶4.  Rodriguez showed Coronado a deed of trust executed for the Locke Property, with Coronado named as beneficiary.  Coronado Decl., ¶4, Ex. 2.  Rodriguez said an escrow would be opened with Penn Escrow to record the deed of trust to secure the loan.  Coronado Decl., ¶4. 

            Based on Rodriguez’s representations, on January 17, 2020, Coronado loaned the money and Rodriguez executed a note for $50,000 (“2020 Note”).  Coronado Decl., ¶4, Ex. 2.  Rodriguez agreed to repay only $500 in interest monthly from February 17, 2020 through January 17, 2021, at which point the loan would mature and the balance of principal and unpaid interest would become due.  Coronado Decl., ¶4, Ex. 2. 

            Rodriguez never opened an escrow or recorded the deed of trust for the Locke Property.  Coronado Decl., ¶4.  Defendants sold the Locke Property in 2021 without repaying the 2020 Note.  Coronado Decl., ¶4.

            In April 2021, Rodriguez requested another loan from Coronado to purchase 3657 Philadelphia Street, Chino, CA 91710 (“Philadelphia Property”).  Coronado Decl., ¶5.  Defendants promised Coronado a deed of trust on the Philadelphia Property to secure this loan.  Coronado Decl., ¶5, Ex. 3.  The parties agreed to combine this new loan with the $50,000 principal and $5,000 interest Rodriguez owed under the 2020 Note, for a total loan of $125,000.  Coronado Decl., ¶5.  Defendants also led Coronado to believe Penn Escrow would handle the escrow.  Coronado Decl., ¶5. 

            On March 31, 2021, Coronado funded this $125,000 loan.  Coronado Decl., ¶5.  He did not receive a copy of the note for this loan (“Spring 2021 Note”) until April 25, 2021.  Coronado Decl., ¶5, Ex. 3.  The deed of trust transferring Rodriguez’s interest in the Philadelphia Property to Coronado is also dated April 25, 2021.  Coronado Decl., ¶5, Ex. 3.  Coronado did not receive the signature page for the Spring 2021 Note until May 6, 2021.  Coronado Decl., ¶5.

            Penn Escrow did not handle the transaction.  Coronado Decl., ¶5.  Coronado later learned the deed of trust for the Philadelphia Property was never recorded.  Coronado Decl., ¶5.  Defendants sold the Philadelphia Property in October 2021 without Coronado’s knowledge or repayment of the Spring 2021 Note.  Coronado Decl., ¶5. 

 

            3. December 2021 Note

            In late 2021, Rodriguez asked Coronado for a loan to purchase the two Project Properties.  Coronado Decl., ¶6.  Rodriguez told Coronado he would develop the lots, sell them, and use the profits to repay the loan upon completion of the Project.  Coronado Decl., ¶6.  Rodriguez asked Coronado to roll the $125,000 owed under the Spring 2021 Note into the new loan.  Coronado Decl., ¶6.  Coronado would lend additional amounts so that the principal of the new loan totaled $180,000.  Coronado Decl., ¶6. 

            Coronado agreed to make this loan.  Coronado Decl., ¶6.  The $180,000 principal of the loan included the $125,000 under the Spring 2021 Note and $55,000 delivered to Rodriguez on November 14, 2021.  Coronado Decl., ¶6. 

            Coronado did not receive the signed December 2021 Note until December 21, 2021.  Coronado Decl., ¶6, Ex. 4.  The signature page identified Yireh as the borrower.  Coronado Decl., ¶6, Ex. 4.  Rodriguez had not told Coronado beforehand that Yireh would be the borrower under this loan.  Coronado Decl., ¶6.

            Yireh promised to repay the $180,000 principal with interest at a 12% annual rate.  Coronado Decl., ¶6, Ex. 4.  The December 2021 Note required monthly payments of $1,800.  Coronado Decl., ¶6, Ex. 4.  The balance of payments were due at the end of the Project, based on the greater of 20% of profits to be paid upon sale of the Project Properties and 12% of monthly interest.  Coronado Decl., ¶6, Ex. 4.

            If Yireh defaulted on the loan, Coronado could send written notice of intent to accelerate the outstanding principal and interest thereon if Yireh did not repay overdue amounts by a certain date.  Coronado Decl., ¶6, Ex. 4.  The repayment deadline must be at least 30 days after mailing or delivery of such notice.  Coronado Decl., ¶6, Ex. 4.  If Coronado exercised the option to accelerate the amount owed, he may also recover reasonable attorney’s fees and costs incurred in enforcing the December 2021 Note.  Coronado Decl., ¶6, Ex. 4. 

            The December 2021 Note provided for a separate mortgage, deed of trust, or security deed (“Deed of Trust”) to protect Coronado against any loss stemming from Yireh’s breach.  Coronado Decl., ¶6, Ex. 4.  This security instrument would list the conditions under which Yireh would need to immediately repay all amounts owed.   Coronado Decl., ¶6, Ex. 4.  These conditions included sale of any part of or interest in the Project Properties without Coronado’s consent.  Coronado Decl., ¶6, Ex. 4. 

            If Coronado exercised this option, he was required to provide Yireh written notice of the loan acceleration.  Coronado Decl., ¶6, Ex. 4.  The notice would give Yireh at least 30 days after such notice to pay all amounts secured under the Deed of Trust.  Coronado Decl., ¶6, Ex. 4.  If Yireh failed to comply, Coronado could exercise his right to accelerate the amount owed without further notice.  Coronado Decl., ¶6, Ex. 4. 

 

            4. Breach

            In May 2023, Rodriguez and Yireh sold the Gambier Property for $225,000.  Coronado Decl., ¶7, Ex. 5.  Defendants had not completed any construction on either of the Project Properties.  Coronado Decl., ¶7.  Yireh has also listed the Pueblo Property for sale.  Coronado Decl., ¶¶ 8, 13, Ex. 13.[2] 

            To date, Coronado has not received any of the payments required under the December 2021 Note.  Coronado Decl., ¶¶ 7-8.  Coronado would not have loaned Defendants $180,000 thereunder if he had known they would not undertake the Project and would sell the Project Properties without paying off the loan.  Coronado Decl., ¶8.

 

            D. Analysis

            Plaintiff Coronado applies for a right to attach order against Defendant Yireh in the amount of $180,435, which includes $435 in costs.

 

            1. A Claim Based on a Contract and on Which Attachment May Be Based 

            A writ of attachment may be issued only in an action on a claim or claims for money, each of which is based upon a contract, express or implied, where the total amount of the claim or claims is a fixed or readily ascertainable amount not less than five hundred dollars ($500).  CCP §483.010(a). 

            Coronado’s application is based on the December 2021 Note, whose principal is $180,000.  Coronado Decl., ¶6, Ex. 4.  Attachment may be based on this contract claim. 

             

            2. An Amount Due That is Fixed and Readily Ascertainable  

            A claim is “readily ascertainable” where the damages may be readily ascertained by reference to the contract and the basis of the calculation appears to be reasonable and definite.  CIT Group/Equipment Financing, Inc. v. Super DVD, Inc., (2004) 115 Cal.App.4th 537, 540-41.  The fact that the damages are unliquidated is not determinative.  Id.  But the contract must furnish a standard by which the amount may be ascertained and there must be a basis by which the damages can be determined by proof.  Id. (citations omitted).

            Under the December 2021 Note, Yireh promised to pay $180,000 plus interest at a 12% annual rate.  Coronado Decl., ¶6, Ex. 4.  Coronado seeks attachment based on the unpaid $180,000 principal without interest.  Coronado Decl., ¶6, Ex. 4.  These damages are ascertainable. 

            Under the December 2021 Note, if Coronado exercised his right to accelerate the amount owed after Yireh defaulted on the Loan, he could recover reasonable attorney’s fees and costs he incurs through enforcement.  Coronado Decl., ¶6, Ex. 4.  A plaintiff’s application for a right to attach order may include an estimate of the costs and allowable attorney’s fees.  CCP §482.110(a). 

            Coronado seeks attachment of $435 in costs related to filing this action.  Mem. at 6.  Coronado does not provide an attorney declaration to support his estimate of costs.  However, this Complaint was subject to statutory fees.  The uniform fee for filing the first paper in an unlimited civil action is $355.  Government Code (“Govt. Code”) §70611.  Two $40 supplemental fees shall be collected for any first paper subject to this fee.  Govt. Code §§ 70602.5, 70602.6(a)-(b). 

The $435 in costs are ascertainable.

 

            c. Conclusion

            $180,435 in damages are ascertainable.

 

            3. Probability of Success 

            A claim has “probable validity” where it is more likely than not that the plaintiff will recover on that claim.  CCP §481.190.  In determining this issue, the court must consider the relative merits of the positions of the respective parties.  Kemp Bros. Construction, Inc. v. Titan Electric Corp., (2007) 146 Cal.App.4th 1474, 1484.  The court does not determine whether the claim is actually valid; that determination will be made at trial and is not affected by the decision on the application for the order.  CCP §484.050(b). 

 

            a. Merits of Yireh’s Breach

            In late 2021, Rodriguez asked Coronado for a loan to purchase the Project Properties.  Coronado Decl., ¶6.  The $180,000 principal of the December 2021 Note reflected a $55,000 loan for this purchase plus $125,000 Defendants owed under the Spring 2021 Note.  Coronado Decl., ¶¶ 5-6, Exs. 3-4. 

            Payment under the December 2021 Note was due upon completion of the Project.  Coronado Decl., ¶6, Ex. 4.  If Yireh defaulted on the loan, Coronado could send written notice of intent to accelerate the outstanding principal and interest thereon if Yireh did not repay overdue amounts by a certain date.  Coronado Decl., ¶6, Ex. 4.  The acceleration date must be at least 30 days after mailing or delivery of such notice.  Coronado Decl., ¶6, Ex. 4.

            The December 2021 Note also required Yireh to provide a Deed of Trust which would list the conditions under which Yireh may need to repay all amounts owed.  Coronado Decl., ¶6, Ex. 4.  This included sale of any part of or interest in the Project Properties without Coronado’s consent.  Coronado Decl., ¶6, Ex. 4.  If Coronado exercised the right to accelerate amounts owed, he was required to provide Yireh with written notice.  Coronado Decl., ¶6, Ex. 4.  This notice must give Yireh 30 days to pay all amounts secured by the Deed of Trust.  Coronado Decl., ¶6, Ex. 4.

            Coronado presents evidence that Rodriguez and Yireh sold the Gambier Property in May 2023 and asserts without documentary evidence that Defendants did not finish the Project before they sold the Gambier Property.  Coronado Decl., ¶7.  Coronado fails to demonstrate he sent Yireh written notice of his intent to accelerate amounts owed under the December 2021 Note unless it cured the default within 30 days.  Coronado Decl., Ex. 4.

            Because Yireh does not oppose this application, these defects are waived.

 

            b. Secured by Deed of Trust

            An attachment may not be issued on a claim which is secured by any interest in real property arising from agreement, statute, or other rule of law.  CCP §483.010(b).  However, an attachment may be issued where the claim was originally so secured but, without any act of the plaintiff or the person to whom the security was given, the security has become valueless or has decreased in value to less than the amount then owing on the claim, in which event the amount to be secured by the attachment shall not exceed the lesser of the amount of the decrease or the difference between the value of the security and the amount then owing on the claim.  Id.

            Coronado provides the deeds of trusts securing the 2020 and Spring 2021 Notes.  Coronado Decl., Exs. 2-3.  Although Coronado asserts Defendants never recorded these deeds of trust (Coronado Decl., ¶¶ 4-5), they did not need to do so for attachment to be unavailable for these loans.  Recordation of a trust deed is not usually required for its validity.  RNT Holdings, LLC v United Gen. Title Ins. Co. (2014) 230 Cal.App.4th 1289, 1295.

            Yireh borrowed money under the December 2021 Note to purchase the Project Properties.  Coronado Decl., ¶6.  As with the prior Notes, the December 2021 Note provided for a separate Deed of Trust to protect Coronado against any loss stemming from Yireh’s breach.  Coronado Decl., ¶6, Ex. 4.  Coronado does not provide any evidence that Yireh failed to sign a Deed of Trust for the Project Properties.  The failure to record such a Deed of Trust is not required.  If one was signed to secure the December 2021 Note, that is sufficient to prevent Coronado from obtaining an attachment.

            Yireh has sold the Gambier Property for $225,000 and listed the Pueblo Property for sale.  Coronado Decl., ¶¶ 7-8, 13, Exs. 5, 13.  The sale of the Gambier Property decreased the value of Coronado’s security interest in any Deed of Trust.  But Coronado’s security interest in such a Deed of Trust remains because Yireh has not sold the Pueblo Property.  Coronado fails to demonstrate the value of the Pueblo Property is less than the $180,000 owed under the December 2021 Note.  See CCP §483.010(b). 

            Coronado’s claim against Yireh under the December 2021 Note is secured by the interest in the Pueblo Property.  Because its value may exceed the amount owed, no right to attach order may issue on this claim.

 

            c. Conclusion

            Coronado has not shown that Yireh did not sign a Deed of Trust as the 2021 Note requires.   Nor has he shown that such a Deed of Trust would not sufficiently secure the loan.  See CCP §483.010(b).  As a result, he has not demonstrated a probability of success on the merits.

 

            4. Attachment Sought for a Proper Purpose¿ 

            Attachment must not be sought for a purpose other than the recovery on the claim upon which attachment is based.¿ CCP §484.090(a)(3).  Coronado seeks attachment for a proper purpose.

 

            E. Conclusion

            The application for a right to attach order is denied.

 

            F. Supplemental Analysis

            The hearing was continued for Coronado to provide a supplemental declaration showing that he never received a deed of trust, was never informed that Yireh had signed one, and the Los Angeles County Recorder’s office did not record one.

 

            1. Statement of Facts

            Coronado never received a mortgage, deed of trust, or a security deed on any real property, including the Project Properties, to secure the December 2021 Note.  Coronado Supp. Decl., ¶4.  Coronado never heard that Defendants had signed a mortgage, deed of trust, or security deed on such real property to secure the December 2021 Note.  Coronado Supp. Decl., ¶4.

            Defendants sold the Gambier Property without ever contacting Coronado to pay off the December 2021 Note.  Coronado Supp. Decl., ¶6.

            There is no mortgage, deed of trust, or security deed recorded against either Project Property to secure the December 2021 Note.  Coronado Supp. Decl., ¶7.  On January 5, 2024, Coronado received an ALTA Commitment For Title Insurance from Fidelity National Title Insurance Company for the Pueblo Property.  Coronado Supp. Decl., ¶7, Ex. 18.  It lists one deed of trust in 2017 to secure $200,000 owed to Anne Messenger.  Coronado Supp. Decl., ¶7, Ex. 18.  It also lists two deeds of trust in 2019 to secure a collective $301,500 owed to Danco, Inc.  Coronado Supp. Decl., ¶7, Ex. 18.  Neither company has anything to do with Coronado or the December 2021 Note.  Coronado Supp. Decl., ¶7.

            The transaction history on First American Title’s property reports for the Project Properties (Coronado Decl., ¶¶ 7, 9, Exs. 5, 8) also show deeds of trust in favor of companies Danco, Inc. and Anne Messenger, but not Coronado.  Coronado Supp. Decl., ¶7.

            The claim at issue in this application and Complaint is not secured by any mortgage, deed of trust or lien on real property.  Coronado Supp. Decl., ¶5.

            Coronado gave the required notice of default to both Defendants in September 2023.  Coronado Supp. Decl., ¶8.

 

            2. Analysis

            The court previously continued Coronado’s application for a right to attach order against Yireh to show that the claim was not secured by a deed of trust on the Project Properties.  Coronado properly noticed this continuance.

            Coronado asserts that he never received a mortgage, deed of trust, or a security deed on any real property, including the Project Properties, to secure the December 2021 Note.  Coronado Supp. Decl., ¶4.  He submits the ALTA title policy commitment as evidence that no mortgage, deed of trust, or security deed has been recorded against the Pueblo Property to secure the amount owed under the  December 2021 Note.  Coronado Supp. Decl., ¶7, Ex. 18.  He also notes that the First American Title property reports submitted with the moving papers (Coronado Decl., ¶¶ 7, 9, Exs. 5, 8) do not show deeds of trust in his favor recorded against either Project Property.    Coronado Supp. Decl., ¶7.            

            Coronado has demonstrated that no deed of trust secures the claim underlying this application for a right to attach order.  The application for a right to attach order is granted in the amount of $180,435.  Coronado has not filed a proposed right to attach order and must do so in two court days or it will be waived.  No right to attach order shall issue until Coronado files a $10,000 undertaking.



            [1] Coronado failed to provide courtesy copies of the application for a right to attach order and notice of the application, in violation of the Presiding Judge’s First Amended General Order Re: Mandatory Electronic Filing.  His counsel is admonished to provide courtesy copies in all future filings.

            [2] Coronado also presents evidence that Defendants currently list Yireh’s other properties for sale and have listed Rodriguez’s home in the past.  Coronado Decl., ¶¶ 11-12, 14-16, Exs. 12, 14-17.  He asserts Defendants intend to put the proceeds of these sales beyond creditors’ reach.  Coronado Decl., ¶¶ 11, 16-17.  The court need not discuss this in detail; Coronado does not need to demonstrate a likelihood of harm for a noticed application for a right to attach order.