Judge: Mary H. Strobel, Case: 22STCV26260, Date: 2023-01-10 Tentative Ruling

Case Number: 22STCV26260    Hearing Date: January 10, 2023    Dept: 82

            Plaintiff Gateway Pointe, LLC (“Plaintiff”) moves for a writ of attachment against Defendant Fitness International, LLC (“Defendant”) in the amount of $1,503,068.86.   

Judicial Notice

Defendant’s Request for Judicial Notice (“RJN”) Exhibits 4-51 – Granted.

Plaintiff’s Reply RJN Exhibits A-J – Granted.

Plaintiff’s Reply RJN Exhibit K – Denied.  Plaintiff has not provided the court sufficient information to judicially notice Exhibit K or Plaintiff’s factual assertion that “Defendant was the recipient of a $300 million COVID relief loan under the Main Street Loan Facility, part of the Main Street Loan Program.”  (Evid. Code § 452(c), (g), (h) and § 453(b).) 

Defendant’s Evidentiary Objections

Declaration of Mark Lu

(1)-(35) Overruled. 

(36), (37) Sustained. 

(38)-(53) Overruled. 

(54), (55) Sustained.

(56) Overruled.

Declaration of Gregg Martin

(1)-(23) Overruled. 

Relevant Procedural History

            On August 12, 2022, Plaintiff filed a complaint against Defendant for breach of lease. 

            On September 9, 2022, Plaintiff filed its application for writ of attachment.  The court has received Defendant’s opposition and Plaintiff’s reply.

            On October 14, 2022, Defendant filed an answer to the complaint and also a cross-complaint for breach of lease (covenant of quiet enjoyment), common counts, and declaratory relief.  Defendant’s answer asserts numerous affirmative defenses, including for failure of consideration, impossibility, impracticability, and frustration of purpose.

            On November 15, 2022, Plaintiff filed an answer to the cross-complaint.

Summary of Applicable Law

“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.) 

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 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 Attachment Law statutes are subject to strict construction.” (Epstein v. Abrams (1997) 57 Cal.App.4th 1159, 1168.) 

“The court’s determinations [for an application for writ of attachment] shall have no effect on the determination of any issues in the action other than issues relevant to proceedings [for attachment]. The court’s determinations under this chapter shall not be given in evidence nor referred to at the trial of any such action.”  (CCP § 484.100.)

Analysis 

1.    Probable Validity of Plaintiff’s Claim

The application is based on Plaintiff’s cause of action for breach of contract.  To establish a claim for breach of contract, a plaintiff must generally prove: (1) existence of a contract; (2) plaintiff’s performance or excuse for nonperformance; (3) defendant’s breach of the contract; and (4) damages incurred by plaintiff as a result of the breach.  (Durell v. Sharp Healthcare, (2010) 183 Cal.App.4th 1350, 1367.) 

Plaintiff’s Evidence Satisfies All Elements of its Contract Claim

Plaintiff owns real property located at 1275 E. Foothill Blvd., La Verne, CA 91750 (“Property”).  Defendant currently occupies the Property pursuant to a written Lease Plaintiff’s predecessor executed with Defendant on March 8, 1999, and written First Amendment to Lease executed by Plaintiff and Defendant on February 10, 2011 (hereafter “Lease”).  (Lu Decl. ¶¶ 3-10, 19, Exh. 1-2.)  Commencing on March 1, 2011, the initial Term of the Lease was extended to February 28, 2026.  (Ibid.)  Annual base rent was $797,450.04 per annum through February 28, 2016, and increasing on March 1, 2016, and each five years after that pursuant to a formula specified in the Lease.  (Ibid.) 

Plaintiff submits evidence that, beginning in April 2020, Defendant failed to pay the full rent due and owing pursuant to the Lease.  Beginning in April 2021, Defendant resumed making full payment of rent, without repayment of the prior unpaid rent.  (Lu Decl. ¶¶ 13-18.)  Plaintiff submits evidence that it performed all terms and conditions of the Lease, unless it was excused from doing so.  (Id. ¶ 12.)  Plaintiff gave written notice to Defendant of its failure to pay rent.  (Compl. ¶¶ 5-13 and Reply Lu Decl. Exh. 5-8.)

Plaintiff submits a ledger and calculations showing that Plaintiff has been damaged in the amount of $954,808.52 for unpaid rent.  Plaintiff submits calculations of late charges and interest of $28,644.26 and $149,944.78, respectively, pursuant to the terms of the Lease.  The Lease includes a provision entitling Plaintiff to fees and costs in enforcing the Lease. Plaintiff submits evidence that it already incurred $11,671.30 in attorney’s fees in enforcing the Lease and anticipates incurring at least $255,000 in additional attorney’s fees and $103,0000 in additional costs.  These amounts total $1,503,068.86.  (See Lu Decl. ¶¶ 20-25, Exh. 3-4; Martin Decl. ¶¶ 1-14.)

            Defendant objects to the declaration of Mark Lu, Plaintiff’s property manager, on various grounds.  The court has ruled on those objections above.  Lu has provided sufficient foundation for his testimony about the Lease, Plaintiff’s performance, Defendant’s breach, and Plaintiff’s calculation of damages.  Lu declares, under penalty of perjury, that he is employed by Mar Investments as a property manager for the Property.  He declares personal knowledge of the matters stated in his declaration.  (Lu Decl. ¶¶ 1-10.)  Defendant does not dispute that Lu is the property manager for the Property.  Nor has Defendant materially challenged the mathematical calculations of damages, including interest and late charges, provided by Lu.  In the opposing declaration of Diann Alexander, Defendant also admits the existence of the Lease, that it has possession of the Property, the payment of rent to Plaintiff pursuant to the Lease, and its failure make certain payments from April 2020 to April 2021.  (See Alexander Decl. generally.)  The Lu declaration, as corroborated by the Alexander declaration, is competent evidence in support of all elements of Plaintiff’s contract claim.

            Defendant also objects to the declaration of attorney Gregg Martin regarding Plaintiff’s estimates of reasonably attorney’s fees and costs.  The court has ruled on those objections above.  Martin submits evidence that “Defendant has vigorously defended and/or sued landlords throughout the state of California claiming that it was justified in withholding rent due to the pandemic.”  (Martin Decl. ¶ 5.)  The judicially noticeable record corroborates that assertion.  (Defendant’s RJN Exh. 44-51; Plaintiff’s RJN Exh. A-J.)  Martin declares that written discovery; depositions, including of experts; a summary judgment motion; other motion practice; and a trial likely will be litigated in this case.  (Martin Decl. ¶¶ 3-14.)  Given that legal disputes rather than factual disputes appear to dominate in this action, the court finds the estimate of $255,000 in additional attorney’s fees and $103,000 in additional legal costs to overestimate reasonable attorneys’ fees and costs.  Based on this type of legal action, and the court’s experience, the court finds an additional $100,000 in attorneys’ fees and additional

$50,000 in costs to be reasonable allowable fees and costs to be included within the amounts attached.  (CCP § 482.110.) 

            Defendant contends that Plaintiff has not proven breach of the Lease because it “introduces no evidence it provided Fitness with the requisite written notice and five days’ opportunity to cure, as required by section 14.1.”  (Oppo. 7.)  Section 14.1 is titled “Events of Default” and states, in pertinent part, that a material default and breach of the Lease by the tenant includes “[a]ny failure by Tenant to pay the rental or make any other payment required to be made by Tenant hereunder as and when due where such failure shall continue for a period of five (5) days after written notice thereof from Landlord to Tenant.”  Contrary to Plaintiff’s assertion, section 14.1 is a general default provision and does not apply solely to unlawful detainer actions.  (Reply 9-10.)  Further, section 3.1 defines “monthly base rent” and does not include any specific language concerning events of default or breach.  (Ibid.)  Section 14.1 controls and required Plaintiff to provide written notice of Defendant’s “failure … to pay the rent” and to give 5 days to cure before a breach would occur.  (See Silverado Modjeska Rec. & Park Dist. v. County of Orange (2011) 197 Cal. App. 4th 282, 312-314 [holding that similar lease provision required written notice of breach].) 

However, section 14.1 only requires written notice of the non-payment of rent and a 5-day period to cure.  Plaintiff submits evidence that it satisfied that requirement.  Plaintiff provided Defendant written notice of its failure to pay rent on several dates between December 23, 2020, and August 15, 2022.  (Reply Lu Decl. Exh. 5-8.)  It is undisputed that Defendant did not pay the unpaid rent within 5 days of these written notices.   Accordingly, Plaintiff has shown a probably valid claim that it complied with the notice requirement of section 14.1.

            Plaintiff has met its initial burden to show a probably valid claim for breach of Lease in the amount of $1,295,068.86.  The court further considers below whether Defendant has proven an affirmative defense that justifies a denial of attachment or reduction in the amount of attachment.  

Plaintiff’s Performance of the Covenant of Quiet Enjoyment

            Defendant contends that Plaintiff cannot establish its own performance under the Lease because Defendant did not have quiet enjoyment of the Property for certain periods as a result of Covid-19 “stay-at-home” orders of state and local government.  (Oppo. 8; see also Answer, 3^rd Affirmative Defense for Landlord’s Failure to Perform.)   Defendant phrases the argument, as follows: “During the periods when it was illegal for Fitness to open or operate the Premises … Fitness did not ‘have and quietly enjoy the Premises.’ Consequently, Landlord was in breach of Section 19 of the Lease.”  (Oppo. 8.)  This argument relates to the third affirmative defense for Landlord’s failure to perform. 

            Defendant raises an issue of contractual interpretation, which requires the court to ascertain the parties’ intent in Section 19 and other parts of the Lease.  “‘Under statutory rules of contract interpretation, the mutual intention of the parties at the time the contract is formed governs interpretation. [Citation.] Such intent is to be inferred, if possible, solely from the written provisions of the contract.’”  (Silverado Modjeska Rec. & Park Dist. v. County of Orange (2011) 197 Cal. App. 4th 282, 313.)  In construing contracts, specific provisions control over general provisions and all provisions should be given meaning.  (City of Los Angeles v. Pac. Elec. Ry. Co. (1959) 168 Cal.App.2d 224, 229.)

            Section 19 of the Lease states in full: “Tenant, upon fully complying with and promptly performing all of the terms, covenants and conditions of this Lease on its part to be performed, and upon the prompt and timely payment of all sums due hereunder, shall have and quietly enjoy the Premises for the Term set forth herein, subject to all provisions of this Lease and all matters of record against the Project.” 

            Defendant does not show a probably valid defense based on section 19.  Defendant admittedly remains in possession and therefore has an obligation to pay rent.  “Stated in another manner, the covenant of quiet enjoyment is not broken until there has been an actual or constructive eviction.”  (Petroleum Collections Inc. v. Swords (1975) 48 Cal.App.3d 841, 847.)  “Abandonment of premises by the tenant within a reasonable time after the wrongful act of the landlord is essential to enable the tenant to claim a constructive eviction.”  (Stoiber v. Honeychuck (1980) 101 Cal.App.3d 903, 925-926.) 

            Further, by its terms, section 19 is conditioned on Defendant’s performance of all “terms, covenants and conditions of this Lease on its part to be performed, and upon the prompt and timely payment of all sums due hereunder.”  In addition to other Lease provisions governing payment of rent, the Force Majeure provision in section 22.10 applies.  Section 22.10 states in pertinent part:

Any prevention, delay or stoppage due to … acts of God, … governmental restrictions, governmental regulations, governmental controls, judicial orders, … fire or other casualty, and other causes (except financial) beyond the reasonable control of the party obligated to perform, shall excuse the performance by that party for a period equal to the prevention, delay or stoppage, except the obligations imposed with regard to Monthly Base Rent and Additional Rent to be paid by Tenant pursuant to this Lease; provided the party prevented, delayed or stopped shall have given the other party written notice thereof within thirty (30) days of such event causing the prevention, delay or stoppage.

Although Plaintiff cited this provision in the moving papers as a basis for Defendant’s “obligation to continue paying its rent” during Covid-19 orders, Defendant wholly failed to address it in opposition.  (See Lu Decl. ¶ 11 and Sehulster Tunnels/Pre-Con v. Traylor Brothers, Inc. (2003) 111 Cal.App.4th 1328, 1345, fn. 16 [failure to address point is “equivalent to a concession”].)  Section 22.10 is more specific than section 19 and clearly states the tenant’s obligation to pay rent during periods in which government orders precluded either party from performing an obligation under the lease.  Accordingly, section 22.10 controls over section 19 on that issue.

Finally, while Defendant may further develop the argument for future proceedings, the court is presently not persuaded by Defendant’s argument that section 19 assigns responsibility for government action related to the Covid-19 pandemic to the landlord.  While section 19 is broadly worded, there is no language suggesting that that the landlord is obligated by the Lease to ensure that no government action impacts the tenant’s quiet enjoyment of the premises.  Notably, Defendant cites no published appellate decision that has adopted its interpretation of section 19 or a similar lease term.  Defendant admits that it has been given possession and quiet enjoyment of the Property for much of the Lease term, and Plaintiff did not cause the Covid-19 orders that allegedly impacted Defendant’s quiet enjoyment for certain periods.  For all these reasons, Defendant does not show a probably valid defense on the grounds that “Landlord breached its obligations under Section 19.”  (Oppo. 9.) 

Temporary Impossibility, Impracticability, Frustration of Purpose, and Civil Code Section 1511(1)

The answer pleads affirmative defenses for impossibility, impracticability, frustration of purpose, and excuse pursuant to Civil Code section 1511.  Defendant admittedly retains possession of the Property and has resumed rent payments.  Defendant develops no argument of “complete” or permanent impossibility, impracticability, or frustration of purpose that would entirely excuse its performance under the Lease.  Rather, Defendant argues for a “temporary” excuse from its obligation to pay rent based on these doctrines.  (Oppo. 9-13.)

“‘A thing is impossible in legal contemplation when it is not practicable; and a thing is impracticable when it can only be done at an excessive and unreasonable cost.’ [Citation.]’ This does not mean that a party can avoid performance simply because it is more costly than anticipated or results in a loss. Impracticability does not require literal impossibility but applies when performance would require excessive and unreasonable expense.  Similarly, where performance remains possible, but the reason the parties entered the agreement has been frustrated by a supervening circumstance that was not anticipated, such that the value of performance by the party standing on the contract is substantially destroyed, the doctrine of commercial frustration applies to excuse performance.”  (Habitat Trust for Wildlife, Inc. v. City of Rancho Cucamonga (2009) 175 Cal.App.4th 1306, 1336; see also Civil Code § 1511(2).) 

Civil Code section 1511(1) states in material part that “[t]he want of performance of an obligation … is excused” when “such performance … is prevented … by the operation of law.”  Section 1511(1) is applied similarly to the impossibility doctrine and requires a similar showing by Defendant.  (See Baird v. Wendt Enters., Inc. (1967) 248 Cal. App. 2d 52, 55 [performance of construction contract was impossible when new building code precluded ability to obtain building permit; section 1511(1) excused performance].)

Significantly here, “impracticability of performance or frustration of purpose that is only temporary suspends the obligor's duty to perform while the impracticability or frustration exists but does not discharge his duty or prevent it from arising unless his performance after the cessation of the impracticability or frustration would be materially more burdensome than had there been no impracticability or frustration.”  (Maudlin v. Pacific Decision Sciences Corp. (2006) 137 Cal.App.4th 1001, 1017; accord Bergin v. Van Der Steen (1951) 107 Cal.App.2d 8, 16.)  The same rule applies to a defense of temporary impossibility: “The obligation to perform is not excused or discharged by a temporary impossibility—it is merely suspended—unless the delayed performance becomes materially more burdensome or the temporary impossibility becomes permanent.”  (Maudlin, supra, 137 Cal.App.4th at 1017.) 

On this record and briefing, Defendant does not prove a probably valid defense to repayment of the rent at issue based on temporary impossibility, impracticability, frustration of purpose, and excuse pursuant to Civil Code section 1511(1).  Defendant admits that the pertinent Covid-19 government restrictions have been lifted and that it now operates its gym at full capacity.  (Alexander Decl. ¶¶ 15-29.)  Defendant submits no direct evidence that payment of the unpaid rent became “materially more burdensome than had there been no impracticability or frustration.”  (Ibid.)  To the extent Defendant argues that this requirement is met because it lost membership or revenues during periods of government closure (see Id. ¶ 29), Defendant does not fully develop the argument.  Nor does Defendant directly address this issue in its opposition brief.  Accordingly, on this briefing, the court finds that Defendant does not prove the “materially more burdensome” requirement to discharge its payment obligations.

While not so stated, Defendant seems to contend that it is not liable for past-due rent after the alleged temporary suspension ended because courts have concluded, for purposes of the statute of limitations, that “periodic monthly rental payments called for by a lease agreement create severable contractual obligations.”  (Oppo. 10, fn. 6, citing Tsemetzin v. Coast Federal Savings & Loan Assn. (1997) 57 Cal. App. 4th 1334, 1344.)  However, Defendant only cites cases holding that a monthly lease is an installment contract for the purpose of the statute of limitations.  “An opinion is not authority for propositions not considered.’”  (People v. Knoller (2007) 41 Cal.4th 139, 154-55.) Defendant does not cite a case holding that past-due lease payments may be excused under doctrines of temporary impossibility, impracticability, or frustration of purpose if the requirements of those doctrines are not met (i.e., no evidence that performance would be materially more burdensome than had there been no impracticability or frustration.) 

These defenses also require Defendant to show that its performance of the Lease could only be done with “excessive and unreasonable cost” or that the value of the Lease to Defendant was “substantially destroyed.” Defendant has not made this showing.  There is no frustration of purpose simply because governmental action makes performing a contract more difficult or expensive.  (Lloyd v. Murphy (1944) 25 Cal. 2d 48, 55 [“Governmental acts that make performance unprofitable or more difficult or expenses do not excuse the duty to perform a contractual obligation”]; FPI Development, Inc. v. Nakashima (1991) 231 Cal. App. 3d 367, 399 [same].) 

Here, the Lease permits Defendant to use the Property as “a full service sports and health club facility and ancillary uses typically found in L.A. Fitness Sports Clubs such as a pro shop, physical therapy center, chiropractic care, personal training, weight loss advising and related programs, therapeutic massage, swim lessons, racquetball lessons, tanning salon, juice bar, child care facility for members and food and beverage service (‘Permitted Uses’).” (Lu Decl. Exh. 1, Lease at ¶ 1.15 [bold italics added].)[1]  Defendant, which has the initial burden of proof on its affirmative defenses, submits no evidence that it could not have operated some of these ancillary uses while government Covid-19 regulations were in place and could not have obtained some value from the Property during such periods.  (See e.g. McGarry Decl. Exh. 4-42 [Covid-19 orders that include various exemptions from stay-at-home orders]; see Alexander Decl. generally.) 

Defendant contends that its right to engage in “ancillary uses” was conditioned on its ability to use the Property for its primary purpose—i.e., operating an indoor fitness center.  (Oppo. 10, fn. 8.)  However, “contract provisions are not construed as conditions precedent in the absence of language plainly requiring such construction.”  (JMR Construction Corp. v. Environmental Assessment & Remediation Management, Inc. (2015) 243 Cal.App.4th 571, 594.)  While use of the word “ancillary” suggests the parties believed that the other services would generally be offered in conjunction with the gym, there is no express statement in section 1.15 that Defendant was prohibited from performing ancillary services during any period in which it was prohibited from operating a gym or otherwise decided to close the gym facilities on a temporary basis (e.g., for renovations).  Further, section 1.15 defined “Permitted Uses” as both the full service sports and health club facility and ancillary uses, and then provided a long list of other services that could be provided.  On this briefing, while Defendant’s interpretation is not implausible, the court finds Plaintiff’s interpretation of section 1.15, under which Defendant could offer the ancillary services separate from the gym, to be somewhat stronger.  (Reply 5.)  The court also notes that Defendant offers no evidence that it asked Plaintiff whether it could operate any of the ancillary services while the gym was closed due to Covid-19 restrictions. 

Based on the foregoing, Defendant does not show probably valid defenses for temporary impossibility, impracticability, frustration of purpose, and excuse pursuant to Civil Code section 1511(1).

Failure of Consideration

            Defendant contends that there was a failure of consideration that excuses its payment of rent.  (Oppo. 13-14.)  However, “[f]ailure of consideration does not…vitiate the contract from the beginning; until rescinded or terminated a contract once in effect remains in effect.”  (Taliaferro v. Davis (1963) 216 Cal. App. 2d 398, 411; see also 3 Cal. Affirmative Def. § 57:1 [same] and Civil Code § 1689 [stating that contract may be rescinded “If the consideration for the obligation of the rescinding party fails, in whole or in part, through the fault of the party as to whom he rescinds.”].)

Defendant does not prove its defense for failure of consideration under the probably valid standard because Defendant remains in possession of the Property and has not rescinded or terminated the Lease. 

Having considered the relative merits of the parties’ positions, and all evidence in the record, the court finds that Plaintiff has shown a probably valid claim for breach of contract for the amount of damages specified in its application. 

2.    Basis of Attachment

“[A]n attachment may be issued only in an action on a claim or claims for money, each of which is based upon a contract, express or implied, where the total amount of the claim or claims is a fixed or readily ascertainable amount not less than five hundred dollars ($500) exclusive of costs, interest, and attorney's fees.”  (CCP § 483.010(a).)  “An attachment may not be issued on a claim which is secured by any interest in real property arising from agreement ….”  (CCP § 483.010(b).) 

Here, Plaintiff’s application for writ of attachment is based on a lease where the total amount allegedly due is in excess of $500.  The lease is not secured by real property.  The lease provides standards under which Plaintiff’s damages may be calculated and ascertained with proof.   Plaintiff’s damages are fixed and readily ascertainable from the lease and the declaration of property manager Mark Lu.

3.    Purpose and Amount of Attachment

Code of Civil Procedure section 484.090 states that the Court shall issue a right to attach order if “the attachment is not sought for a purpose other than the recovery on the claim upon which the attachment is based . . . [and] the amount to be secured by the attachment is greater than zero.”

Plaintiff declares, and the court finds, that attachment is not sought for a purpose other than the recovery on Plaintiff’s claim.  (Appl. ¶ 4; Lu Decl. ¶ 20.)  The amount to be secured is greater than zero.  

Mark Lu is the property manager and an authorized agent of Plaintiff.  He shows sufficient personal knowledge that attachment is not sought for a purpose other than the recovery on Plaintiff’s claim.  (Appl. ¶ 4; Lu Decl. ¶ 20.)  The court rejects Defendant’s challenge to the sufficiency of this evidence.  (Oppo. 15.)

Defendant contends that attachment is sought for an improper purpose because “Landlord is well aware of Fitness’s payment of almost $2,000,000.00 since April 2021 and its full and timely payment of rent since the government orders were lifted.”  Defendant also argues that attachment is improper because “Landlord waited 2.5 years to seek to enforce its purported right to the disputed rent, and now seeks to obtain the disputed rent on an expedited basis through an attachment.”  (Oppo. 14.)  Neither argument persuades.  Pre-judgment attachment may be reasonably sought even if the defendant is financially viable or continues to pay rent, including to secure Plaintiff’s interest against any other creditors Defendant may have.  Considering the unique circumstances of the Covid-19 pandemic, with evolving government restrictions and financial impacts on tenants such as Defendant, it is not surprising that Plaintiff did not immediately file suit or move for pre-judgment attachment.  In any event, as long as the party seeks relief prior to judgment, the pre-judgment attachment statutes provide no time limit for this provisional remedy. 

The court finds that attachment is not sought for a purpose other than the recovery on Plaintiff’s claim.  The amount to be secured is greater than zero. 

4.    Reduction of Amount to be Secured Based on Offset Claims or Affirmative Defenses

Code of Civil Procedure section 483.015(b) provides that the amount to be secured by the attachment shall be reduced by, inter alia:  “(2) The amount of any indebtedness of the plaintiff that the defendant has claimed in a cross-complaint filed in the action if the defendant’s claim is one upon which an attachment could be issued.”

“[T]o sustain reduction in a writ amount, most courts require that the defendant provide enough evidence about its counterclaims and/or defenses to prove a prima facie case [for attachment against Plaintiff].”  (Ahart, California Practice Guide: Enforcing Judgments and Debts, ¶ 4:64 (1998 rev.).)  Defendant has the burden of proof to satisfy the requirements of attachment for any offset claim.  (See CCP § 483.015 and Lydig Construction, Inc. v. Martinez Steel Corp. (2015) 234 Cal.App.4th 937, 945.)  

Defendant seeks to offset the attachment based on the damages Defendant allegedly suffered by Plaintiff’s alleged breach of the covenant of quiet enjoyment in section 19 of the Lease.  (Oppo. 9:3-7; see also Alexander Decl. ¶¶ 22-29.)  This argument is entirely derivative of Defendant’s third affirmative defense for Landlord’s failure to perform and its contention that Plaintiff breached section 19, which have been analyzed above.  For the same reasons discussed above, Defendant does not prove that affirmative defense under the probable validity standard.  Accordingly, Defendant does not show that it is entitled to offsets for any months that it paid full rent despite only being permitted by government regulation to operate at partial capacity.  (Alexander Decl. ¶¶ 22-29.)

5.    Subject Property

Code of Civil Procedure section 487.010(a) provides that “[w]here the defendant is a corporation, all corporate property for which a method of levy is provided” is subject to attachment.   Thus, the request for attachment of all of Defendant’s property is appropriate.  (Application ¶ 9c.) 

6.    Exemptions

Defendant does not claim any exemptions. 

7.    Undertaking

Code of Civil Procedure section 489.210 requires the plaintiff to file an undertaking before issuance of a writ of attachment.  Code of Civil Procedure section 489.220 provides, with exceptions, for an undertaking in the amount of $10,000.  Neither party argues for a different amount of undertaking.

8.    Turnover Order  

Plaintiff seeks a turnover order.  (See Proposed Order ¶ 3.d.)  “If a writ of attachment is issued, the court may also issue an order directing the defendant to transfer to the levying officer either or both of the following: [¶] (1) Possession of the property to be attached if the property is sought to be attached by taking it into custody. [¶] (2) Possession of documentary evidence of title to property of or a debt owed to the defendant that is sought to be attached.”  (CCP § 482.080 [emphasis added].) 

Plaintiff has not shown the applicability of this section to its attachment request or briefed the necessity of this additional remedy.  The request for a turnover order is denied.

Conclusion

The application for a writ of attachment is GRANTED in the amount of $1,295,068.86.  The request for a turnover order is denied.  Plaintiff to post an undertaking of $10,000.