Judge James C. Chalfant, Case Number: 23STLC04564, Date: 2023-10-26 Tentative Ruling

Santander Consumer, USA Inc. v. Gloria De Alvarado et al., 23STLC04564

Tentative decision on application for writ of possession: conditionally granted

Plaintiff Santander Consumer, USA Inc. (“Santander”) seeks a writ of possession against Defendant Hugo Ramirez (“Ramirez”), individually and doing business as King Auto (“King”), to recover a 2017 Toyota Sienna, VIN 5TDYZ3DC7HS892934 (“Vehicle”).

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

Plaintiff Santander commenced this proceeding on July 19, 2023, against Defendants Gloria De Alvarado (“Alvarado”), Ramirez, King, and California Department of Motor Vehicles (“DMV”), alleging (1) claim and delivery of personal property for pretrial writ of possession, and order directing transfer of personal property and restraining order; (2) conversion; (3) quiet title; and (4) declaratory relief. The Complaint alleges in pertinent part as follows.

Prior to the commencement of this action, Alvarado and non-party Hamer Toyota (“Seller”) entered into a contract to purchase the Vehicle (“Agreement”) which Seller then assigned to Santander. Pursuant to the Agreement, Alvarado was required to pay $1,000 on July 7, 2021 and 72 monthly installments of $846.04 beginning July 13, 2021. The Agreement required that Alvarado provide Seller, and therefore Santander, with a security interest in the Vehicle and right to immediate possession should Alvarado default.

On April 23, 2022 and thereafter, Alvarado failed to pay the required monthly installment. She owes $33,674.29 plus other charges provided for in the Agreement.

Alvarado has transferred the Vehicle to King for repairs and storage. Santander believes that Alvarado has accrued $9,330 in unpaid labor, tow, and storage fees. King has not applied to the DMV for approval to conduct a lien sale, which Santander opposes. King has confirmed it still has the Vehicle but Santander’s demands for its return have failed.

Santander seeks recovery of the Vehicle or the value thereof, a writ of possession directing Defendants to transfer the Vehicle to Santander, $18,500 plus interest for damages for conversion, punitive damages, judgment that the plaintiff is the legal owner, and attorney’s fees and costs.

On July 21, 2023, Santander served Defendant DMV with the Complaint and Summons.

On August 17, 2023, 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.

On September 7, 2023, Santander served Defendant Ramirez with the Complaint, Summons and moving papers by substitute service, effective September 17, 2023.

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.[2] 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).

King is a licensed automotive repair dealer with California Bureau of Automotive Repair License Number 289828. Vargas Decl., ¶5.

On May 29, 2021, Alvarado entered into the Agreement to purchase the Vehicle. Vargas Decl., ¶7, Ex. A. Pursuant to the Agreement, Alvarado was required to pay $1,000 on July 7, 2021 and 72 monthly installments of $846.04 beginning July 13, 2021. Vargas Decl., ¶7, Ex. A. The Agreement also required that the Vehicle title reflect Seller’s security interest in the Vehicle. Vargas Decl., ¶7, Ex. A. In the event of default for failure to make a payment on time, 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. Vargas Decl., ¶7, Ex. A.

Seller assigned the Agreement to Santander. Vargas Decl., ¶7, Ex. A. The Lien and Title Information Report reflects Santander’s interest as lienholder, as the Agreement requires. Vargas Decl., ¶7, Exs. A-B.

On April 23, 2022 and thereafter, Alvarado failed to pay the required monthly installment. Vargas Decl., ¶8. As of July 2023, Alvarado’s payment history shows that she owes $31,637 in outstanding principal, $1,608.25 in interest, $338.40 in late fees, and $90 in miscellaneous charges for a total of $33,674.29. Vargas Decl., ¶8, Ex. C.

Alvarado has transferred the Vehicle to King for repairs and storage. Vargas Decl., ¶10. Santander believes that Alvarado has accrued $9,330 in unpaid labor, tow, and storage fees. Vargas Decl., ¶10. King failed to timely send a notice of the stored Vehicle to Santander and apply for DMV approval to conduct a lien sale. Vargas Decl., ¶11.

On July 25, 2023, Santander offered to pay King the $2,750 maximum for repair and storage fees owed under Civil Code section 3068. Vargas Decl., ¶13, Ex. D. Santander made this offer despite King’s failure to timely apply for a lien sale. Vargas Decl., ¶13, Ex. D. Santander also warned King of case law that rejecting the offer would waive the right to recover on any repair and storage lien. Vargas Decl., ¶13, Ex. D. King rejected this offer. Vargas Decl., ¶13.

The June 2023 N.A.D.A. Auto Market Report lists the average wholesale and retail values of the Vehicle as $18,500 and $23,750, respectively. Vargas Decl., ¶14, Ex. E.

Santander’s offer letter lists King’s address as 2301 W Martin Luther King Jr Blvd., Los Angeles, CA 90008. Vargas Decl., ¶13, Ex. D. Santander believes this is King’s principal place of business and the current location of the Vehicle. Vargas Decl., ¶18.

Plaintiff Santander applies for a writ of possession for the Vehicle against Defendant Ramirez, individually and doing business as King. No proof of service is on file for Defendant Alvarado and her rights with respect to the Vehicle are not at issue in this application.

The Agreement required Alvarado to pay $1,000 on July 7, 2021 and 72 monthly installments of $846.04 beginning July 13, 2021. Vargas Decl., ¶7, Ex. A. In the event of default such as failure to make a payment on time, 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. Vargas Decl., ¶7, Ex. A. Seller then assigned its rights to Santander. Vargas Decl., ¶7, Ex. A. A Lien and Title Information Report reflects Santander’s interest in the Vehicle. Vargas Decl., ¶7, Ex. B.

Alvarado’s payment history shows she defaulted in April 2022 and owes a total of $33,674.29. Mem. at 2; Vargas Decl., ¶8, Ex. C.

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 a 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 maximum lien for storage of the vehicle increases to $1,250 if an application for an authorization to conduct a lien sale has been filed within 30 days after the commencement of the storage or safekeeping. Id. 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 body shop rejects an offer by the vehicle’s legal owner or lessor of the statutory amount for payment of the mechanic’s lien for repair and/or storage of the vehicle. Universal CIT Credit Corp. v. Rater, (1963) 214 Cal.App.2d 493, 495.

The lien also 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 asserts that Alvarado incurred $9,330 in total repair and storage fees owed to King. Vargas Decl., ¶11. Santander never authorized or consented to these charges before they were incurred as required by Civil Code section 3068(c)(1). Mem. at 3. The lien limits under Civil Code section 3068(c)(1) apply.

King has also failed to timely apply for DMV approval to conduct a lien sale. Vargas Decl., ¶¶ 11, 13, Ex. D. Santander still offered the $2,750 maximum for repair and storage fees owed if King did timely apply for approval. Mem. at 3; Vargas Decl., ¶13, Ex. D. As Santander warned King, the failure to accept this offer extinguished King’s lien. Mem. at 4-5; Vargas Decl., ¶13, Ex. D; Civil Code §3068(c); Universal CIT Credit Corp. v. Rater, supra, 214 Cal.App.2d at 495.

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. CCP §515.010(a). Because King’s storage and repair liens are extinguished, it has no interest in the Vehicle. No undertaking is required.

The application requests a writ authorizing the levying officer to enter 2301 W. Martin Luther King Jr. Blvd., Los Angeles, CA 90008. Santander presents evidence that this is the Vehicle’s current location insofar as this is King’s principal place of business and the recipient address on Santander’s offer letter. Vargas Decl., ¶¶ 13, 18, Ex. D. This suggests the address is commercial in nature. In any case, Santander has justified a writ to enter a private residence at this address.

The application for a writ of possession is granted against Defendant King. However, Santander has not served Defendant Alvarado or provided her notice of this application. Sandander is directed to notify Alvarado through service of process as a condition of the writ of possession. If Alvarado cannot be located through due diligence, Santander may file a declaration to that effect and provide her notice through mail or electronic service at her last known address.

Once this condition is performed, the writ of possession may issue. Santander has not submitted an order for writ of possession and must do so within two court days of service on Alvarado or it will be waived. The levying officer may enter King’s address of 2301 W. Martin Luther King Jr. Blvd., Los Angeles, CA 90008, as well as any commercial and public address, to seek possession of the Vehicle.

[1] The courtesy copies of Santander’s moving papers, required under the Presiding Judge’s First Amended General Order Re: Mandatory Electronic Filing, lack certain pages. Counsel is admonished to include all pages and staple future courtesy copies.

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