Judge: Mark C. Kim, Case: 22SMCV00217, Date: 2022-12-08 Tentative Ruling
Case Number: 22SMCV00217 Hearing Date: December 8, 2022 Dept: S27
1. 22LBCV00049
On 2/01/22, SEJ Properties, L.P.
filed 22LBCV00049 against Defendants, 1801-1899 Willow, LLC and Alma D. Barnes
for specific performance and related claims arising out of Defendants’ alleged
refusal to close escrow on Plaintiff’s purchase of a commercial property.
On 3/29/22, the Court denied
Defendants’ motion to expunge lis pendens, finding Plaintiff had established
the probable validity of its claims against Defendants.
2. 22SMCV00217
On 2/16/22, SEJ Properties, L.P.
filed 22SMCV00217 against Defendants, Escrow L.A., Inc. and Sharon L. Sharp for
breach of fiduciary duty and related claims arising out of Defendants’ refusal
to release the funds that were deposited into the escrow account in connection with
the transaction at issue in 22LBCV00049.
3. Motion
for Reconsideration
a.
Procedural History
On 4/26/22, the Court, Honorable Mark
H. Epstein presiding, denied Plaintiff’s motion for release of funds. The Court denied the motion on the ground
that 1801-1899 Willow, LLC was a necessary party to the motion and had not been
added as a defendant. Plaintiff moves
for reconsideration of the order. It contends
it has now added Willow as a doe defendant, it will prevail on the merits of
the motion, and it will suffer irreparable harm if a mandatory injunction ordering
Escrow LA to release the funds is not issued.
b.
Reconsideration
The Court is inclined to find that
the addition of all necessary parties to the action is sufficient to show a new
fact, circumstance, or law, such that reconsidering the prior order is
procedurally proper. The Court will, therefore,
rule on Plaintiff’s request for a mandatory injunction on its merits.
c.
Request for Mandatory Injunction
As an initial note, orders granting
mandatory, as opposed to prohibitive, injunctions are extremely rarely
granted. Mandatory preliminary
injunctions are rarely granted (and if granted, are subject to stricter
scrutiny on appeal): “The granting of a mandatory injunction pending trial is
not permitted except in extreme cases where the right thereto is clearly
established.” Teachers Ins. &
Annuity Ass'n v. Furlotti (1999) 70 Cal.App.4th 1487, 1493; Integrated Dynamic
Solutions, Inc. v. VitaVet Labs, Inc. (2016) 6 Cal.App.5th 1178, 1184; Brown v.
Pacifica Found., Inc. (2019) 34 Cal.App.5th 915, 925.
Plaintiff concedes that “irreparable
harm” must be shown in order to impose injunctive relief. It contends irreparable harm is presumed when
there is a very strong probability of prevailing on the merits of the action. It cites King v. Meese (1987) 43 Cal.3d 1217,
1226 to support this position. Plaintiff
mis-cites King. In King, the Court held
that an injunction could be imposed where the “balancing of harms” favored the
defendant, if the plaintiff’s showing of likelihood of success on the merits
was extremely strong. The Court noted that
there is a balancing test used, and the stronger one of the showings is, the
less strong the other showing need be.
Irreparable harm, however, is an initial threshold requirement for injunctive
relief, separate and apart from the “balancing of harms” test that is conducted
AFTER the showing of irreparable harm is made.
In other words, it is often the case that the plaintiff will suffer
irreparable harm if an injunction is not granted, but the defendant will also
suffer irreparable harm if an injunction is granted; in those situations, the
Court must balance the harms to the parties against the likelihood of success
on the merits of the action.
Irreparable harm is often related
to the “inadequate legal remedy” (i.e., the damages remedy is inadequate
because some immeasurable harm is threatened). But it is also a separate
consideration. Relief is unlikely unless someone will be significantly hurt in
a way that cannot later be repaired. People ex rel. Gow v. Mitchell Brothers'
Santa Ana Theater (1981) 118 Cal.App.3d 863, 870-871.
Plaintiff herein has failed
entirely to show irreparable harm or that the legal remedy is inadequate. On the contrary, if the request for a mandatory
injunction is denied, the money will remain on deposit in escrow. The only harm to Plaintiff is that the money
will not be released until the conclusion of the litigation. This is hardly “irreparable,” and clearly
monetary damages are adequate, as the money is literally sitting in an escrow
account.
d.
Conclusion
The motion for reconsideration is granted;
the request for substantive relief in the form of a mandatory injunction is, however,
denied.
4. CMC
The parties are reminded that there
is a CMC on calendar today concurrently with the hearing on the above
motion. The Court asks Counsel to make
arrangements to appear remotely at the hearing on the motion and the CMC.