Superior Court of California

County of Los Angeles

North Central District

Department B

financial pacific leasing, inc.,

Plaintiff,

mar trans, inc., et al.,

Defendants.

Case No.: 23BBCV00510

Hearing Date: September 15, 2023

[TENTATIVE] order RE:

APPLICATIONs for writ of attachment

BACKGROUND

A. Allegations

Plaintiff Financial Pacific Leasing, Inc. (“Plaintiff”) alleges that on November 9, 2020, Defendant Mar Trans, Inc. (“MTI”) entered into a written Equipment Finance Agreement with Plaintiff whereby MTI leased certain equipment, including a 2020 KL8OFQ 14F Generator S/N 2063095 with Plaintiff. Plaintiff alleges that on October 15, 2022, MTI defaulted on the agreement by failing to make payment then due. Plaintiff alleges that $69,890.04 is now due and payable to Plaintiff, plus late charges of 10% of the total monthly payment (or $1,941.40) and 18% interest per annum from October 15, 2022.

Plaintiff also alleges that Defendant Romanos Hakobyan (“Hakobyan”) executed a written Personal Guaranty, to guaranty MTI’s obligation under the agreement. Plaintiff alleges that pursuant to the terms of the Guaranty and as a result of MTI’s default under the agreement, the sum of $71,866.44 together with interest is due and payable to Plaintiff from Hakobyan.

The complaint, filed March 3, 2023, alleges causes of action for: (1) breach of equipment finance agreement; (2) breach of guaranty; (3) account stated; and (4) claim and delivery.

B. Relevant Background and Applications for Writs of Attachment

On March 22, 2023, Plaintiff filed an application for writ of attachment against MTI and an application for writ of attachment against Hakobyan.

On May 30, 2023, Plaintiff filed proofs of service of the summons, complaint, and application documents, showing that MTI and Hakobyan were served by substituted service on May 23, 2023 and the documents were thereafter mailed.

The Court is not in receipt of an opposition brief from Defendants.

On July 12, 2023, the defaults of MTI and Hakobyan were entered.

The matter came for hearing on July 21, 2023. The Court ordered Plaintiff to file and serve by August 1, 2023, a supplemental declaration with a legible copy of the Equipment Finance Agreement and Personal Guaranty, as well as an amended AT-105 form regarding Defendant Romanos Hakobyan with the correct information in section 9. The Court continued the hearing on the applications to August 18, 2023.

The matter came for hearing on August 18, 2023. The Court noted that Plaintiff did not file any additional documents on August 1, 2023 and continued the hearing to September 15, 2023 to give Plaintiff an additional opportunity to file the requested supplemental declaration with a legible copy of the Equipment Finance Agreement and Personal Guaranty, as well as an amended AT-105 form regarding Defendant Romanos Hakobyan with the correct information in section 9. The Court ordered Plaintiff to file the documents by September 1, 2023.

Plaintiff did not file the requested document by September 1, 2023.

LEGAL STANDARD

“Upon the filing of the complaint or at any time thereafter, the plaintiff may apply pursuant to this article for a right to attach order and a writ of attachment by filing an application for the order and writ with the court in which the action is brought.” (CCP § 484.010.)

The application shall be executed under oath and must include:

(1) a statement showing that the attachment is sought to secure the recovery on a claim upon which an attachment may be issued;

(2) a statement of the amount to be secured by the attachment;

(3) a statement that the attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based;

(4) a statement that the applicant has no information or belief that the claim is discharged or that the prosecution of the action is stayed in a proceeding under the Bankruptcy Act (11 U.S.C. section 101 et seq.); and

(5) a description of the property to be attached under the writ of attachment and a statement that the plaintiff is informed and believes that such property is subject to attachment.

(CCP § 484.020.)

“The application [for a writ of attachment] shall 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.) Statutory attachment procedures are purely creations of the legislature and as such “are subject to ‘strict construction.’” (Hobbs v. Weiss (1999) 73 Cal.App.4th 76, 79 [citing Vershbow v. Reiner (1991) 231 Cal.App.3d 879, 882]; see also Nakasone v. Randall (1982) 129 Cal.App.3d 757, 761.) A judge does not have authority to order any attachment that is not provided for by the attachment statutes. (Jordan-Lyon Productions, Ltd. v. Cineplex Odeon Corp. (1994) 29 Cal.App.4th 1459, 1466.) “The declarations in the moving papers must contain evidentiary facts, stated ‘with particularity,’ and based on actual personal knowledge with all documentary evidence properly identified and authenticated.” (Hobbs, supra, 73 Cal.App.4th at 79–80 [citing CCP § 482.040].) “In contested applications, the court must consider the relative merits of the positions of the respective parties and make a determination of the probable outcome of the litigation.” (Id. at 80 [ellipses and quotation marks omitted].) “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 § 481.190.)

The Court shall issue a right to attach order if the Court finds all of the following:

(1) The claim upon which the attachment is based is one upon which an attachment may be issued.

(2) The plaintiff has established the probable validity of the claim upon which the attachment is based.

(3) The attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based.

(4) The amount to be secured by the attachment is greater than zero.

(CCP § 484.090(a).)

A claim of exemption must describe the property to be exempted and specify the statute section supporting the claim. (CCP § 484.070(c).) The plaintiff has the burden of opposing the defendant’s claim of exemption, and if the plaintiff fails to oppose a claim of exemption, “no right to attach order or writ of attachment shall be issued as to the property claimed to be exempted.” (CCP § 484.070(f).)

DISCUSSION

A. Probable Validity of Plaintiff’s Claims

Plaintiff’s application for writ of attachment against Defendants MTI and Hakobyan.

“The standard elements of a claim for breach of contract are: “(1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) damage to plaintiff therefrom. [Citation.]” (Wall Street Network, Ltd. v. New York Times Co. (2008) 164 Cal.App.4th 1171, 1178.)

In support of the application, Plaintiff provides the declaration of Janet D. Gonzalez, who is employed by Plaintiff and Vice President of Portfolio Services. (Gonzalez Decl., ¶1.) Ms. Gonzalez states that she is the custodian of records. (Id., ¶2.)

Ms. Gonzalez states that on November 9, 2020, MTI entered into a written Equipment Finance Agreement with Plaintiff for the lease of the Equipment. (Id., ¶4, Ex. 1.) She states that MTI defaulted on the Agreement on October 15, 2022 by failing to make payment when due and failed to make payments thereafter. (Id., ¶5.) As a result, Plaintiff declared the entire balance of the payments under the Agreement immediately payable and due in the amount of $69,890.04, plus $1,941.40 in 10% monthly late charges, $35 in other charges in connection with the breach, 18% prejudgment interest per annum from October 15, 2022 until judgment is entered, and reasonable attorney’s fees and costs. (Id., ¶¶6-9, 12.) Ms. Gonzalez states that to induce Plaintiff to enter into the Agreement, Hakobyan executed a written Personal Guaranty to the Agreement. (Id., ¶10, Ex. 1.) She states that pursuant to the Agreement, the Equipment is the sole and exclusive property of Plaintiff and, upon the expiration of the lease term, Defendants agreed to immediately return the Equipment. (Id., ¶11.) She states that the fair market value of the Equipment is approximately $40,000, the total amount owed to Plaintiff is $71,866.44, and Plaintiff is unsecured in the amount of $53,866.44. (Id., ¶20.) She states that Plaintiff is seeking a writ of attachment against Defendants for the unsecured amount of $53,866.4, interest at the rate of 18% (October 15, 2022 to February 13, 2023) in the amount of $3,214.97, $1,967.33 in attorney’s fees, and $600 in costs, for a total of $59,648.74. (Id., ¶22.)

Ms. Gonzalez states that upon information and belief, Plaintiff has no information that the claim is discharged in a proceeding under Title 11 of the Bankruptcy Code or that prosecution of the action is stayed in a proceeding under Title 11. (Id., ¶13.) She states that the claim upon which the action is brought is not secured by any mortgage, deed of trust, lien on real or personal property, or on any pledge of personal property. (Id., ¶14.) She states that Defendants did not and have not given any security for the obligation. (Id., ¶14.)

Based on the declaration of Ms. Gonzalez, the Court finds that Plaintiff has established the probable validity of its breach of Equipment Finance Agreement and Personal Guaranty claims. Plaintiff has shown each of the elements of a breach of contract claims by way of the declaration of Ms. Gonzalez. However, the Court has attempted to review the copy of the Equipment Finance Agreement attached to the complaint and the declaration of Ms. Gonzalez. The Agreement is largely illegible as the text is too light. As such, the Court cannot verify the terms of the Agreement. In addition, the Court is concerned about the double counting of interest and late charges.

The Court previously requested that Plaintiff file a legible copy or the original of the Equipment Finance Agreement and Personal Guaranty for the Court’s review before entering an order on the applications for writ of attachment. Despite the Court’s two prior orders requesting the document, Plaintiff has not provided a copy of the requested documents. As such, the Court cannot verify the statements of the agreement and guaranty and declines to enter an order for writ of attachment. For this reason, the applications for writs of attachment are denied.

CONCLUSION AND ORDER

On July 21, 2023 and August 18, 2023, the Court continued Plaintiff’s applications for writs of attachment against Defendants Mar Trans, Inc. and Romanos Hakobyan so that Plaintiff could file a legible copy of the Equipment Finance Agreement and Personal Guaranty and an amended AT-105 form with respect to Defendant Romanos Hakobyan so that it properly describes the property that is being sought for attachment from Mr. Hakobyan. However, Plaintiff failed to do so by the deadlines set by the Court.

As such, the Court denies without prejudice Plaintiff’s applications for writs of attachment against Defendants Mar Trans, Inc. and Romanos Hakobyan. If Plaintiff intends to seek writs of attachment against Defendants, it should refile the applications with a legible copy of the Equipment Finance Agreement and Personal Agreement, as well as a corrected AT-105 form regarding Defendant Romanos Hakobyan at section 9.

Plaintiff is ordered to provide notice of this order.