Judge Matthew C. Braner, Case 37-2019-00028978-CU-BC-CTL 2023-12-01 Tentative Ruling

Judge: Matthew C. Braner, Case: 37-2019-00028978-CU-BC-CTL, Date: 2023-12-01 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

DEPT.:

EVENT DATE:

EVENT TIME:

HALL OF JUSTICE

TENTATIVE RULINGS - November 30, 2023

12/01/2023 09:00:00 AM C-60 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Matthew C. Braner

CASE NO.:

CASE CATEGORY:

EVENT TYPE:

CASE TITLE: CASE TYPE:

Civil - Unlimited Breach of Contract/Warranty Motion Hearing (Civil) 37-2019-00028978-CU-BC-CTL 47 INVESTMENTS INC VS LEMON GROVE PLAZA LP [IMAGED] CAUSAL DOCUMENT/DATE FILED:

Plaintiff 47 Investments Inc.'s motion for discretionary undertaking to stay enforcement of judgment pending appeal is GRANTED.

Plaintiff's motion for assignment order is DENIED without prejudice.

Defendant Lemon Grove Plaza, LP's objections to the reply declaration of attorney Dillon are overruled.

The arguments made in Plaintiff's reply and the evidence submitted on reply in support of those arguments do not address 'the substantive issues in the first instance,' but instead 'fill[s] gaps in the evidence created by [Defendant's] opposition.' (Jay v. Mahaffey (2013) 218 Cal.App.4th 1522, 1538.) This court previously granted Plaintiff's motion for attorney fees and costs and awarded Plaintiff nearly $500,000 in fees and costs. (ROA #560.) Defendant has appealed that award and paid the non-costs portion of the judgment, which stays enforcement of the now cost-only judgment. (Code Civ. Proc., § 916, subd. (a).) However, where '[t]he judgment against appellant is solely for costs awarded to the respondent by the trial court pursuant to Chapter 6 (commencing with Section 1021) of Title 14,' the 'perfecting of an appeal shall not stay enforcement of the judgment or order in cases not provided for in Sections 917.1 to 917.8, inclusive, if the trial court, in its discretion, requires an undertaking and the undertaking is not given . . . .' (Code Civ. Proc., § 917, subd. (a)(3).) 'In a case where the costs judgment is large or the danger of asset dissipation is acute, a trial court can mitigate any injustices arising from the costs-only judgment rule.' (Quiles v. Parent (2017) 10 Cal.App.5th 130, 145.) Here, Plaintiff contends the court should exercise its discretion and require an undertaking because the award for fees and costs is grossly disproportionate to the stipulated money judgment and there is a substantial risk that Defendant's assets will be depleted during the (potentially lengthy) appeal process.

The court agrees.

First, the nearly $498,158.98 award for fees and costs is more than eight times greater than the $61,761.60 stipulated money judgment. (ROA #'s 535, 565.) Second, Plaintiff has presented admissible and unobjected to evidence that Defendant is currently facing a separate lawsuit from Ninus Malan, the former business partner of Salam Razuki. Mr. Razuki was the Chief Financial Officer of Defendant's only general partner (H C W Oil, Inc.) until he was removed after pleading guilty to conspiracy to kidnap Mr.

Malan. Mr. Malan claims damages in the millions stemming from Mr. Razuki and Defendant's conduct. In addition, Mr. Razuki's removal as an officer of Defendant's general partner left only his brother and wife as officers, and his wife filed for marriage dissolution earlier this year. Together, these facts strongly suggest that Defendant's sole asset (a shopping center located on leased land set to expire in 2038) as Calendar No.: Event ID: TENTATIVE RULINGS

3052785 14 CASE NUMBER: CASE TITLE: 47 INVESTMENTS INC VS LEMON GROVE PLAZA LP [IMAGED] 37-2019-00028978-CU-BC-CTL at acute risk of depletion.

These two considerations, coupled with Defendant's demonstrated tactic of delay and increasing litigation costs, lead the court to conclude it should exercise its discretion and require Defendant to post an undertaking in order to stay enforcement of the cost-only judgment pending its appeal. The court is not persuaded by Defendant's argument that this court has demonstrated animus towards it and that requiring an undertaking would be unfair. Defendant ignores the full history of this case and the observations made by both this court and Judge Frazier.

As to the amount of the undertaking, the court is not persuaded by Plaintiff's argument that the requirement for 1.5 or 2 times the amount of the judgment set forth in Code of Civil Procedure section 917.1, subdivision (b), applies to a discretionary undertaking under section 917.9, and there is no binding authority addressing this issue. Based on its own analysis of the statutory language as set forth below, the court is not inclined to require an undertaking of 1.5 or 2 times the amount of the cost-only judgment.

Unlike the express limitations set forth in section 917.1, subdivision (b) of section 917.9 requires only that the undertaking be in a sum fixed by the court and 'in an amount sufficient to cover all damages which the respondent may sustain by reason of the stay in the enforcement of the judgment or order.' As applicable to a cost-only judgment, 'damages' means payment of the cost-only judgment. (Code Civ.

Proc., § 917.9, subds. (a)(3), (d)(2).) 'Damages' under this section must necessarily include both the facial amount of the judgment and any interest accrued on the judgment, which together comprise 'payment' of the judgment in a hypothetical future in which the award is confirmed on appeal.

The court also understands the above statutory language to create a floor and not a ceiling, which is based on the court's discretionary assessment of an amount 'sufficient' to cover 'all' damages. The court concludes that a $600,000 undertaking is warranted under the circumstances, measured by approximating the potential 10% annual interest accrual of the judgment during the appeal, and by assuming the appeal will take no longer than two years from the date interest began accruing.

As to Plaintiff's motion for assignment order, the court believes the motion is premature, as the stay on enforcement is lifted only if the court requires an undertaking and such undertaking is not given. (Code Civ. Proc., § 917.9, subd. (a).) In the event Defendant declines to or fails to provide the undertaking as set forth above, Plaintiff has leave to refile the motion and seek an assignment order.

Defendant has until December 22, 2023, to provide an undertaking in the amount of $600,000.

This undertaking is conditioned upon payment of the sums required by the cost-only judgment Defendant appeals from if the judgment is affirmed or the appeal is withdrawn or dismissed, and it must provide that if the judgment appealed from is affirmed, or the appeal is withdrawn or dismissed, Defendant will pay all damages which Plaintiff may sustain by reason of the stay in the enforcement of the judgment. (Code Civ. Proc., § 917.9, subd. (c).) The minute order is the order of the court.

Calendar No.: Event ID: TENTATIVE RULINGS

3052785 14