Judge Mark E. Windham, Case Number: 18STLC10966, Date: 2024-01-24 Tentative Ruling

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Judgment Creditor American Contractors Indemnity Company’s Motion for Assignment Order, Restraining Order, and Accounting is GRANTED SOLELY WITH RESPECT TO PAYMENTS MADE TO JUDGMENT DEBTOR. JUDGMENT DEBTOR IS TO FILE AND SERVE A PROPOSED ORDER IN ACCORDANCE WITH THIS RULING WITHIN 20 DAYS.

On August 27, 2018, Plaintiff American Contractors Indemnity Company (“Judgment Creditor”), a California corporation filed a Complaint against Defendant Victor Granados (“Judgment Debtor”), an individual, and DOES 1 through 75, inclusive, alleging causes of action for (1) breach of contract and (2) common counts. On January 18, 2019, this Court entered default judgment against Judgment Debtor for the total amount of $18,973.49.

On July 19, 2023, Judgment Creditor filed a Motion for Order of Assignment of Payments. On October 30, 2023, the action as reassigned from Department 25 of the Spring Street Courthouse to Department 26 of the Spring Street Courthouse. (Minute Order, 10/30/23.) No opposition was filed.

Under Code of Civil Procedure, section 708.510, subdivision (a), the moving statute, the Court may order the judgment debtor to assign to the judgment creditor or to an appointed receiver all or part of a right to payment due or to become due. The types of payments that can be assigned include wages due from the federal government if not subject to a withholding order, rents, commissions, royalties, patent or copyright payments, and insurance policy loan value. (Code Civ. Proc., § 708.510, subd. (a).)

Relevant factors the Court may take into consideration when making an assignment order include the judgment debtor’s reasonable requirements if they are a natural person, payments the judgment debtor is required to make to satisfy other judgments and wage assignments, the amount remaining due on the judgment, and the amount to be received in satisfaction of the right to payment that may be assigned.

(Code Civ. Proc., § 708.510, subd. (c).) Construing all the applicable statutes together, the “assignment order” contemplated by Code of Civil Procedure, section 708.510, et seq. must include a court order that assigns a right to payment outright (not simply an order directing the judgment debtor to do so).

Here, Judgment Creditor seeks an order (1) directing payments made by JCE Buildings and Development, Inc.’s and Wilsey Gopp, LLC (“Customers”), and from Customers’ account(s) to Judgment Debtor be assigned to Judgment Creditor; (2) directing Judgment Debtor to turnover to Judgment Creditor any payments made by Customers or out of Customers’ accounts; (3) restraining Judgment Debtor or any servant, agent, employee, attorney, or anyone else acting on her behalf or jointly with her from assigning or otherwise disposing of the right to payment; and (4) compelling Judgment Debtor to provide, file, and serve an accounting every other month as a means of monitoring Judgment Debtor’s activity and to ensure compliance with the Court’s orders.

Judgment Creditor states that on January 18, 2019, judgment was entered in its favor and against Judgment Debtor in the amount of $18,973.49. (Motion, Murray Decl., ¶ 2, Exh. 1.) Furthermore, Judgment Creditor has attempted to enforce its judgment but Judgment Debtor has not paid anything. (Id. at ¶ 3, Exh. 2.) Judgment Creditor avers that it served a bank levy on Citibank in October 2022 and received a memorandum of garnishee stating that no funds were being held. (Id.) Judgment Creditor also avers that it subpoenaed Judgment Debtor’s bank records from Citibank and discovered he still works as an unlicensed contractor for certain customers. (Id. at ¶ 4, Exh. 3.) According to Judgment Creditor, Judgment Debtor has the checks written out to himself personally or out to his business, Vic 1 Construction, which he then deposits into his account. (Id. at ¶ 5, Exh. 4.) Vic 1 Construction is the business that it issued its bond for and a claim on the bond resulted in the judgment at issue. (Id. at ¶ 6, Exh. 5.) Judgment Creditor states that it served a wage garnishment on Judgment Debtor customer JCE Buildings and Development, Inc. and received an employer return indicating he was not employed. (Id. at ¶ 7, Exh. 6.) However, Judgment Creditor avers that based on bank records it was evident that Judgment Debtor does work for JCE Buildings and Development, Inc. (Id. at ¶ 8.) Judgment Creditor avers that its office contacted JCE Buildings and Development, Inc. and was advised by Javier M. Chavarria that Judgment Debtor is considered an independent contractor. (Id.)

Also, Judgment Creditor states that payments are sometimes made directly to Judgment Debtor from certain customer’s accounts at random but on a consistent basis and other times to Vic 1 Construction, which Judgment Debtor endorses and deposits. (Id. at ¶ 9.) Additionally, Judgment Creditor avers that as of June 26, 2023, the balance to satisfy the judgment including post-judgment attorney’s fees and costs, and post-judgment interest is $32,099.63. Judgment Creditor also states that no prior assignment of the right to receive the payments Judgment Debtor is receiving exist now or prior to its judgment.

Lastly, Judgment Creditor requests that the Court order Judgment Debtor’s customers to send all payments due to Judgment Debtor directly to its attorney of record, Lanak & Hanna, P.C., 1851 East First Street, Suite 700, Santa Ana, CA 92705.

Based on the foregoing, the Court finds that Judgment Creditor’s motion for an order of assignment of payments, restraining Judgment Debtor from assigning or otherwise disposing of the right to payment, and compelling accounting is warranted under law. Judgment Creditor has provided sufficient evidence to support that Judgment Debtor consistently receives payments from JCE Buildings and Development, Inc.’s and Wilsey Gopp, LLC that are paid to him, which he endorses and deposits into his personal bank account. However, the motion is denied with respect to payments made by Customers to Vic 1. The Motion does not demonstrate under what legal authority payments made to Vic 1, which is not named as a judgment debtor, should be assigned or turned over to Judgment Creditor.

Therefore, Judgment Creditor American Contractors Indemnity Company’s Motion for Assignment Order, Restraining Order, and Accounting is GRANTED SOLELY WITH RESPECT TO PAYMENTS MADE TO JUDGMENT DEBTOR. JUDGMENT DEBTOR IS TO FILE AND SERVE A PROPOSED ORDER IN ACCORDANCE WITH THIS RULING WITHIN 20 DAYS.