Judge: Margaret L. Oldendorf, Case: 21GDCV01109, Date: 2022-12-16 Tentative Ruling
Case Number: 21GDCV01109 Hearing Date: December 16, 2022 Dept: P
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES
NORTHEAST DISTRICT
I. INTRODUCTION
This action concerns a 2017
Rolls-Royce Ghost motor vehicle. Pursuant to a lease agreement, the vehicle was
leased by Defendant Bakhtiar Investments, LLC. Defendant Saman Bakhtiar signed
as guarantor. The lessor (Rusnak Pasadena) assigned the lease to Plaintiff
Financial Services Vehicle Trust. Later, Saman Bakhtiar sought a pay-off quote,
which Plaintiff provided, and the vehicle was sold to third-party CNC Motors. The
check CNC Motors sent to Plaintiff (in the amount of $195,794.22) was returned
for non-sufficient funds. Plaintiff’s predecessor never released its interest
in the vehicle. In the meantime, however, CNC Motors sold the vehicle to
Defendant Alexander Weinberger for $304,000.
A few months after selling the
vehicle to CNC Motors, Saman Bakhtiar passed away. Plaintiff has settled with
his estate, and recently dismissed it from this action. Plaintiff has also obtained the default of Bakhtiar’s
who was the named lessee. The DMV is only a nominal defendant from whom no direct
relief is sought (except to obtain its compliance with any orders regarding
title).
The causes of action alleged in the
Verified Complaint are:
1. Breach
of Contract – against Bakhtiar Investments and the Estate of Bakhtiar
2.
Money Due – against Bakhtiar Investments and the Estate of Bakhtiar
3. Breach
of Guaranty – against the Estate of Bakhtiar
4.
Claim and Delivery – against Weinberger
5. Conversion
– against Weinberger
6. Quiet
Title – against all defendants
7.
Declaratory Relief – against all defendants
8. Injunctive
Relief – against all defendants.
After filing this action, Plaintiff
sought and obtained an order for writ of possession and repossessed the vehicle
on December 16, 2021. Plaintiff now seeks summary adjudication against Weinberger
as to each of the claims alleged against him. As set forth below, the motion is
granted in part and denied in part.
II. LEGAL
STANDARD
A plaintiff may move for summary judgment in an action if
it is contended that there is no defense to the action. Code Civ. Proc. §437c(a).
Subsection (p) provides:
“For purposes of motions for
summary judgment and summary adjudication:
(1) A plaintiff or
cross-complainant has met his or her burden of showing that there is no defense
to a cause of action if that party has proved each element of the cause of
action entitling the party to judgment on the cause of action. Once the
plaintiff or cross-complainant has met that burden, the burden shifts to the
defendant or cross-defendant to show that a triable issue of one or more
material facts exists as to the cause of action or a defense thereto. The
defendant or cross-defendant shall not rely upon the allegations or denials of
its pleadings to show that a triable issue of material fact exists but,
instead, shall set forth the specific facts showing that a triable issue of
material fact exists as to the cause of action or a defense thereto.”
A motion for summary judgment shall be granted where all the
papers submitted show that there is no triable issue of material fact and that
the moving party is entitled to judgment as a matter of law. Section 437c(c).
Summary judgment may be granted where it completely
disposes of a cause of action, an affirmative defense, a claim of damages, or
an issue of duty. Section 437c(f).
III. ANALYSIS
A. Procedural Considerations
1. The
Notice and Separate Statement Are Substantially Compliant
California Rules of Court, rule 3.1350(b) provides, “If
summary adjudication is sought, whether separately or as an alternative to the
motion for summary judgment, the specific cause of action, affirmative defense,
claims for damages, or issues of duty must be stated specifically in the notice
of motion and be repeated, verbatim, in the separate statement of undisputed
material facts.”
Here, the issues identified in the notice are that Weinberger
has no defenses to Plaintiff’s causes of action for Claim & Delivery, Conversion,
Quiet Title, Declaratory Relief, and Injunctive Relief. These are the 4th
through 8th causes of action in the Complaint. The Separate
Statement identifies as Issue One that “The Undisputed Facts Support Judgment
In Favor Of Plaintiff’s Fourth Cause Of Action For Claim & Delivery.” Issues
Two through Five contain similar language and are aimed at the other causes of
action listed in the Notice. While not a verbatim recitation, the Separate
Statement substantially complies with Rule 3.1350(b). The Notice of Motion
adequately identifies the issues on which adjudication is sought.
2. The
Motion Is Not Premature
Weinberger urges that summary judgment is premature as 60
days have not elapsed since the appearance of any party except himself, citing
Code Civ. Proc. §437c(a)(1). The statute provides that a motion may be made at
any time after 60 days have elapsed since the general appearance in the action
or proceeding of each party against whom the motion is directed or at
any earlier time after the general appearance that the court, with or without
notice and upon good cause shown, may direct. Here, since the motion is only
directed at Weinberger and since more than 60 days have elapsed since he
answered, the motion is not improper.
3. Weinberger’s Opposition Was Untimely
Opposition papers are due 14 days prior to the hearing
(Code Civ. Proc. §437c(b)(3)), which in this case was December 2, 2022. Weinberger
did not file his opposition until December 5, 2022. The opposition is
accompanied by the declaration of a paralegal for defense counsel’s firm who
testifies that when she attempted to file the documents on December 2, 2022,
she was unable to do so as the Court’s system was down for maintenance. The
declaration does not specify what time of day she attempted to file the
papers. It appears she may have attempted
to file them after hours on Friday evening.
By that time, the message from the Court’s server stated that the system
was down for maintenance through Sunday, December 4, 2022.
Although late, the Court takes Weinberger’s arguments
into consideration in its analysis.
4. No Burden To Disprove Defenses
In his opposition, Weinberger argues that Plaintiff has
not met its burden because it fails to address any of his affirmative defenses.
However, a plaintiff who moves for summary adjudication has no burden to do so.
Code Civ. Proc. §437c(p)(1); Oldcastle Precast, Inc. v. Lumbermens Mutual
Casualty Co. (2009) 170 Cal.App.4th 554, 564-565. In making this argument,
Weinberger focuses on Code Civ. Proc. §437c(f)’s requirement that a motion for summary
adjudication must completely dispose of an affirmative defense. This ignores
the fact that Section 437c(f) also permits adjudication of a cause of action,
which is what Plaintiff seeks to do here as to the 4th – 8th
causes of action.
To the extent Plaintiff has met its burden of
establishing a right to adjudication as to any cause of action, the burden
would then shift to Weinberger to show a triable issue of material fact. This
could be done by establishing an affirmative defense. Here, the only
affirmative defense Weinberger really attempts to establish is that he is a bona
fide purchaser for value. A discussion of that defense is contained in the
analysis below.
5. Adjudication Is Not Proper As To Causes
Of Action Seeking Damages
Weinberger is correct, however, that summary adjudication
cannot be entered as to any cause of action where damages are sought, because
Plaintiff has not offered any evidence as to damages. One appellate court explained:
“May a plaintiff seek summary adjudication of liability
only, leaving the resolution of damages to a later trial? The statutory
language mandates the question be answered in the negative. A plaintiff can
obtain summary adjudication of a cause of action only by proving ‘“each element
of the cause of action entitling the party to judgment on that cause of
action.”’ As damages are an element of a breach of contract cause of action (Citation.),
a plaintiff cannot obtain judgment on a breach of contract cause of action in
an amount of damages to be determined later.” Paramount Petroleum Corp. v.
Superior Court (2014) 227 Cal.App.4th 226, 241.
None of the facts in the Separate Statement is directed
to Plaintiff’s damages. In fact, Undisputed Material Fact (UMF) 34 states that
Plaintiff is holding and has not sold the vehicle for sale until a final
adjudication of this lawsuit. Thus, at this point it is not clear what, if any,
monetary damages Plaintiff may have suffered or will suffer.
The Complaint prays for damages and/or fees and costs as
to the 4th cause of action for claim and delivery and the 5th
cause of action for conversion. Specifically, the prayer as to the claim and
delivery cause of action seeks foreclosure of the lease, return of the vehicle,
that proceeds from the sale be applied to the amount due, and that the “Court
determine that the Defendants and each of them are personally liable for
payment of the sums secured by the Lease and that a deficiency judgment be
entered.” The prayer as to the conversion cause of action seeks an amount equal
to the fair market value of the vehicle and/or for a sale and deficiency
judgment.
Weinberger’s argument that “Plaintiff’s lawsuit seeks
substantial damages” from him is therefore correct. Opposition MPA at 8:15-16. Plaintiff
states in its Reply that the Complaint “seeks only an order of possession for
the vehicle and a declaration of its superior lienholder title interest as to
Weinberger,” and that it is not seeking $200,000 in damages. Reply at 5:23-26. However,
the 4th and 5th causes of action do seek damages. Summary adjudication therefore cannot be
granted as to these causes of action.
It should also be noted that the 6th (Quiet
Title), 7th (Declaratory Relief), and 8th (Injunctive
Relief) causes of action are alleged against all defendants, not just
Weinberger. Plaintiff has not established that it is entitled to separate
judgment against Weinberger and thus to the extent it prevails on any cause of
action, final judgment cannot be entered until there is a determination as to
the remaining defaulted defendant. Code Civ. Proc. §437c(k). Trial is currently
set for January 30, 2023.
B. Plaintiffs Has Established Its Superior Title
The central question in the 6th and 7th
causes of action is which party has superior title. Code Civ. Proc. §706.020(a)
provides for an action to establish title against adverse claims to real or
personal property. Code Civ. Proc. §1060 allows any interested person under a
written instrument in cases of actual controversy to bring an action for a
declaration of his or her rights and duties.
Plaintiff’s 8th cause of action for injunctive
relief prays only for an order that until declaratory relief is adjudicated all
Defendants be enjoined from exercising control or possession over the vehicle,
and that the DMV be enjoined from processing any applications involving title.
1. 6th
Cause of Action for Quiet Title
Veh. Code §6301 provides, “When the secured party, his or
her successor, or his or her assignee, has deposited, either physically or by
electronic transmission pursuant to Section 1801.1, with the department a
properly endorsed certificate of ownership showing the secured party as legal
owner or an application in usual form for an original registration, together
with an application for registration of the secured party as legal owner, the
deposit constitutes perfection of the security interest and the rights of all
persons in the vehicle shall be subject to the provisions of the Uniform
Commercial Code . . .”
Plaintiff relies on this statute and on case law that holds
that a party with a perfected security interest in a vehicle has superior title
to that issued to a bona fide purchaser for value. In Suburban Motors, Inc.
v. State Farm Mut. Auto Ins. Co. (1990) 218 Cal.App.3d 1354, the Court of
Appeal explained that Veh. Code §6301 establishes that California is a “full
title” state; meaning that buyers can rely on the information stated on the
title as to who has a security interest in a vehicle. Suburban Motors
also interprets U.C.C. Section 2403, which provides that a person with voidable
title can still pass title to a good faith purchaser. The Suburban Motors
case also holds that when title is obtained by theft it is not voidable but
void, and a seller with void title has nothing to pass. Applying these rules in
this case, if Weinberger purportedly received title that continued to reflect
Plaintiff’s lienholder status, then he took the vehicle with notice of
Plaintiff’s interest. If the title he
purportedly received does not reflect Plaintiff’s lienholder status,
then the question is whether the seller (CNC Motors) obtained clean title by
theft, in which case their interest would be void and it had nothing to pass to
Weinberger.
UMFs 69-102 of the Separate Statement address the 6th
cause of action. The facts stated therein adequately establish how Plaintiff
came to obtain title (UMFS 69, 75), that Plaintiff’s interest in the vehicle
has never been satisfied (UMF 87), that Plaintiff never released its registered
and lienholder interest in the vehicle (UMF 88), that the original Certificate
of Title remains in Plaintiff’s possession (UMF 89), and that at no time did
Plaintiff consent or authorize any transfer, sale, or release of its lienholder
interest in the vehicle to Weinberger or any third party (UMF 94). Evidence
supporting each of these facts is contained in the Declaration of Sarah
Phillips and exhibits attached thereto. Weinberger raises no objections to any
of this evidence.
These undisputed facts support the conclusion that
Plaintiff perfected its title and has never released it. That leaves the
question whether Weinberger’s title still reflects Plaintiff’s interest or he
obtained clean title and if so, how. UMFs 92 and 93 address this question.
UMF 92 states that Plaintiff’s counsel was contacted by
Weinberger’s counsel who informed Plaintiff’s counsel that Weinberger had
purchased the vehicle from CNC Motors but had not been able to obtain title. Evidence
of these facts is contained in the Philips Declaration at ¶25 and the
Declaration of Rebecca A. Caley at ¶3. With this evidence, Plaintiff
establishes that Weinberger could not have had superior title, as he in fact had
none at all. As Weinberger does not have clean title, he cannot establish his
bona fide purchaser defense.
Weinberger’s opposing Separate Statement indicates that
each of these UMFs is undisputed, except UMF 94, which he marked as disputed. However,
simply stating that a UMF is disputed is insufficient. He is required to also
cite to evidence that establishes a a
triable issue of material fact. This he has not done. However, in UMF 26, which
is the same as UMF 94 and which relies on the same evidence, Weinberger cites
to the declaration of his attorney and to the Phillips Declaration (and the
exhibits thereto) in arguing that Plaintiff released its interest in the
vehicle by not objecting (pursuant to ¶38 of the Lease Agreement) after being
put on notice; sending Saman Bakhtiar and CNC Motors the pay-off information
when requested; and attempting to cash the check CNC Motors tendered.
Paragraph 38 of the Lease provides, “I MAY NOT TRANSFER
OR SUBLEASE THIS VEHICLE TO A THIRD PARTY OR ASSIGN THE LEASE OR ANY RIGHTS
UNDER IT WITHOUT YOUR PRIOR WRITTEN APPROVAL, WHICH YOU MAY WITHHOLD IN YOUR
SOLE JUDGMENT.”
Weinberger’s argument seems to be that Plaintiff could
consent to the transfer by providing a pay-off quote; but that is contrary to
the written terms of the Lease, which require written consent for any transfer.
There is no evidence that written consent was given. UMF 94 is therefore undisputed.
In sum, the
undisputed facts establish that Plaintiff perfected its title and has never
released its interest; and that Weinberger has not obtained any competing
title. Accordingly, on these undisputed facts Plaintiff has established that it
is entitled to a judgment quieting title in its favor and as against
Weinberger.
2. 7th Cause of Action for
Declaratory Relief and 8th Cause of Action for Injunctive
Relief
Although re-numbered, the UMFs and evidence offered in
support of these causes of action are the same as for quiet title. The same
analysis applies.
C. Weinberger’s Request for a Continuance is Denied
Weinberger’s request for a continuance pursuant to Code
Civ. Proc. §437c(h) is denied. Weinberger
fails to provide a declaration stating that “facts essential to justify
opposition may exist but cannot, for reasons stated, be presented.” The
declaration of counsel accompanying the opposition does not address the
evidence Weinberger believes exists but cannot now be presented, much less what
efforts have been made to obtain that evidence. Given that trial is approximately
45 days away, discovery will be closing very shortly.
D. Plaintiff’s Objections To Attorney Barry’s
Declaration Are Sustained
Mr. Barry’s
Declaration, which purports to offer evidence concerning his client’s purchase
of the Rolls-Royce, lacks foundation and constitutes hearsay. Plaintiff’s objections are therefore
sustained.
IV. CONCLUSION
AND ORDER
Plaintiff’s motion for summary adjudication against
Weinberger as to the 4th cause of action for claim and delivery and
the 5th cause of action for conversion is denied on the ground that
no evidence of damages has been presented. Plaintiff’s motion for summary
adjudication as to the 6th through 8th causes of action
is granted on the basis that Plaintiff has established by undisputed evidence
that it has superior title to Weinberger.
Plaintiff
is ordered to prepare and lodge a proposed order within 10 days. The trial and Final Status Conference dates
remain as set.
Plaintiff
is ordered to give notice.
Dated: _______________________________
MARGARET OLDENDORF
JUDGE
OF THE SUPERIOR COURT