Judge: Michael E. Whitaker, Case: 23SMCV02555, Date: 2024-11-20 Tentative Ruling
Case Number: 23SMCV02555 Hearing Date: November 20, 2024 Dept: 207
TENTATIVE
RULING
|
DEPARTMENT |
207 |
|
HEARING DATE |
November
20, 2024 |
|
CASE NUMBER |
23SMCV02555
(c/w 23SMCV03059) |
|
MOTION |
Motion
for Appointment of Receiver |
|
MOVING PARTY |
Defendant
and Cross-Complainant Elisa Perlman |
|
OPPOSING PARTY |
Plaintiff
Malibu Road Homeowners Association |
MOVING PAPERS:
OPPOSITION PAPERS:
REPLY PAPERS:
BACKGROUND
The consolidated actions arise from a dispute between Defendant and
Cross-Complainant Elisa Perlman (“Perlman”), and her neighbors, Andrea and
Gelly Valero (collectively, the “Valeros”).
Cross-Defendant Andrea Valero (“Valero”) was also the sole member of the
board of directors for the Plaintiff and Cross-Defendant Malibu Road Homeowners
Association (“HOA”) that governs the property during most of the events giving
rise to the consolidated actions. The
Valeros and the HOA brought two separate lawsuits against Perlman stemming from
the same factual dispute concerning water leaks into the Valeros’ unit,
allegedly caused by Perlman.
Perlman filed a Cross-Complaint against the HOA and Valero, alleging
nineteen causes of action for breach of the Covenants, Conditions &
Restrictions; breach of other governing documents; violations of Civil Code
sections 5210; 4950; 4910; 4920; 4765; 5600; 4923; 4930; 5605; 4925; 4935;
5610; 5615; and 4040; two causes of action for breach of fiduciary duties; and
declaratory relief.
Perlman now moves for the appointment of a receiver over the HOA. The HOA opposes the motion and Perlman
replies.
EVIDENTIARY
OBJECTIONS
The Court rules as follows with
respect to Perlman’s evidentiary objections to the Declaration of Andrea Valero:
1.
Overruled
2.
Overruled
3.
Overruled
4.
Overruled
5.
Overruled
6.
Overruled
7.
Overruled
8.
Overruled
9.
Overruled
10. Overruled
11. Overruled
12. Overruled
13. Overruled
14. Overruled
15. Sustained
16. Overruled
17. Overruled
18. Overruled
19. Overruled
20. Overruled
21. Overruled
22. Sustained
23. Overruled
24. Sustained
as to, “knowing Ms. Perlman had entered a romantic relationship with Mike but
could not or would not reveal his professional credentials. Once I did my discovery
on his professional background and full name which took me awhile to find, led
to learning that Mike was a convicted felon for lewd acts with minors and a
registered sex offender only gives me grave concern to Perlman s lack/bad of
judgement.” Overruled otherwise.
25. Overruled
26. Overruled
27. Overruled
28. Overruled
29. Overruled
30. Overruled
31. Overruled
32. Sustained
as to Exhibit 9.
33. Sustained
as to Exhibit 10.
The Court rules as follows with respect to Perlman’s objections to the
Declaration of Melissa Aikens:
1.
Overruled
2.
Overruled
3.
Overruled
4.
Overruled
5.
Overruled
6.
Overruled
7.
Overruled
8.
Overruled
9.
Overruled
The Court rules as follows with respect to Perlman’s objections to the
Declaration of Sherry Hernandez:
1.
Overruled
2.
Sustained
3.
Overruled
4.
Overruled
5.
Overruled
6.
Sustained
7.
Overruled
8.
Overruled
9.
Sustained
10. Overruled
11. Overruled
12. Overruled
13. Sustained
14. Overruled
15. Overruled
16. Overruled
17. Overruled
18. Overruled
19. Overruled
20. Overruled
The Court rules as follows with respect to Perlman’s objections to the
Declaration of Eduardo Perez:
1.
Overruled
2.
Overruled
3.
Overruled
4.
Overruled
5.
Overruled
The Court rules as follows with respect to Perlman’s objections to the
Declaration of Janelle Lau:
1.
Overruled
The Court rules as follows with respect to Perlman’s objections to the
Declaration of William Freed:
1.
Overruled
2.
Overruled
3.
Overruled
The Court rules as follows with respect to Perlman’s objections to the
Declaration of Melissa Aikens:
1.
Overruled
LEGAL STANDARDS
“The appointment of a
receiver is an ancillary proceeding concerned with the preservation of the
property subject to litigation pending its ultimate disposition pursuant to
final judgment. A receiver is not an agent of either party to the action but
represents all persons interested in the property involved[.]” (Maggiora v. Palo Alto Inn, Inc.
(1967) 249 Cal.App.2d 706, 711–712.)
A receivership is a
provisional remedy “to preserve and manage the property during the course of
the receivership.” (Southern
California Sunbelt Developers, Inc. v. Banyan Limited Partnership (2017) 8
Cal.App.5th 910, 922, 925.) A court may
appoint a receiver in all cases where necessary to preserve the property or the
rights of any party. (Code Civ. Proc., §
564, subd. (b)(9); Baron v. Fire Ins. Exchange (2007) 154 Cal.App.4th
1184, 1191.)
“The appointment of a
receiver is a drastic remedy[.]” (Hoover
v. Galbraith (1972) 7 Cal.3d 519, 528.)
“[T]he provisional remedy of receivership is utilized sparingly and only
upon a compelling showing of need[.] (IFS
Industries, Inc. v. Stephens (1984) 159 Cal.App.3d 740, 756.) “[R]eceivers are often legal luxuries,
frequently representing an extravagant cost to a losing litigant. When it
appears that no reasonably certain benefit will result to one litigant, and a
distinct disadvantage will result to another, courts should weigh carefully the
propriety of appointing a receiver.” (City
& County of San Francisco v. Daley (1993) 16 Cal.App.4th 734, 744
(hereafter Daley).) In light of
the potential expense and hardship to the parties, courts must “carefully weigh
the propriety of such appointment in exercising their discretion to appoint a
receiver particularly if there is an alternative remedy.” (Hoover v. Galbraith, supra, 7
Cal.3d at p. 528.)
“Ordinarily, if there is
any other remedy, less severe in its results, which will adequately protect the
rights of the parties, a court should not take property out of the hands of its
owners. (Golden State Glass Corp. v.
Superior Court of Los Angeles County (1939) 13 Cal.2d 384, 393.) However, the availability of other remedies
does not, in and of itself, preclude a court from appointing a receiver,
particularly where other remedies have been pursued without success. (Gold v. Gold Realty Co. (2003) 114
Cal.App.4th 791, 807; Daley, supra, 16 Cal.App.4th at p. 745.)
EVIDENCE
Perlman requests Judicial Notice of:
1.
Restated Declaration of Covenants, Conditions &
Restrictions for 25366 Malibu Road recorded on July 30, 2018, in the Official
Records of Los Angeles County as Document No. 20180761460 (a true and correct
copy of which is attached as Exhibit 1.)
2.
Certificate of Amendment to Restated Declaration of
Covenants, Conditions and Restrictions for the Malibu Road Homeowners
Association recorded on March 19, 2024, in the Official Records of Los Angeles
County as Document No. 20240180312 (a true and correct copy of which is
attached as Exhibit 2.)
Courts can take judicial
notice of the existence and recordation of real property records, including
deeds, if authenticity is not reasonably disputed. (Fontenot v. Wells Fargo Bank, N.A.
(2011) 198 Cal.App.4th 256, 264-265.)
“The official act of recordation and the common use of a notary public
in the execution of such documents assure their reliability, and the
maintenance of the documents in the recorder’s office makes their existence and
text capable of ready confirmation, thereby placing such documents beyond
reasonable dispute.” (Ibid.) Moreover, courts can take judicial notice not
only of the existence and recordation of recorded documents but also matters
that can be deduced from the documents, including the parties, dates, and legal
consequences of recorded documents relating to real estate transactions. (Ibid.)
Therefore, the Court takes
judicial notice of the existence, recordation, and legal consequences of
Exhibits 1 and 2.
DISCUSSION
Perlman requests the appointment of a
receiver over the HOA because (1) there exists a danger that the second floor
landing will be “lost, removed, or materially injured” and (2) “the Valeros are
abusing their status as the supermajority in grossly mismanaging the HOA’s
affairs[.]”
In support of her argument,
Perlman cites to Misita v. Distillers Corp. (1942) 54 Cal.App.2d 244
(hereafter Misita.) In Misita,
two brothers and a sister jointly owned a liquor store business. A dispute arose between the brothers, one of
whom filed suit to remove the other as director and to appoint a receiver to
manage the company during the pendency of the litigation. The appellate court held the trial court had
not abused its discretion in appointing a receiver where there was evidence that
the corporation was unable to function, the stockholders unable to meet, and
the majority stockholder was managing the business illegally, raising his own
salary, and using the company’s assets for personal purposes, as well as taking
illegal rebates from transportation companies and illegally refilling liquor
bottles. (Id. at pp. 251-252)
Here,
with regard to the second floor landing, Perlman argues that despite two expert
reports indicating that the source of the leak in the Valeros’ unit was the HOA
planter boxes, the Valeros relied instead on a third finding that postulated
the source of the leak could be coming from under the second-floor landing, and
demolished the second floor landing. (Perlman
Decl. ¶¶ 21-41; Exhs. 10-14.)
The demolition has impeded Perlman’s access to her unit, and Perlman indicates
the HOA is slow to repair the demolished landing, and prioritizing repairs to
the landing that abut the Valeros’ unit. (Ibid.)
The
HOA contends the leak was caused by Perlman’s own “shoddy” waterproofing and
tiling of the second floor landing, and the delays in repairing the demolished
landing have occurred despite the Valeros’ diligent efforts. (Valero Decl. ¶¶ 7-30; 37.) Valero further declares, that although the
repair efforts are taking longer than any party wants, the Valeros remain
motivated by the continued loss of rental income to diligently repair the
landing.
Ultimately, the Court does not find the
evidence regarding the second floor landing warrants the drastic remedy of
appointing a receiver.
With regard to the Valeros’ alleged
mismanagement of the HOA, Perlman contends the Valeros are misusing their
majority interest, as owners of units 1, 2, and 4, to take official HOA action
without giving Perlman an opportunity to be heard. (Perlman Decl. ¶¶ 5-6, 13, 16-17.) Perlman also contends the Valeros comingle
HOA funds with their own, and have failed to make timely mortgage payments or
maintain flood insurance. (Id. at
¶ 18; Galal Decl. ¶¶ 2-4.)
The Valeros counter that any special
assessments the HOA levies affect the Valeros three-fold, that every
reimbursement the Valeros have requested has been for a legitimate HOA expense,
was properly documented, and the expense report and invoice were sent to the
property management company, Ross Morgan, and that the Valeros are personally
paying the HOA’s attorneys’ fees.
(Valero Decl. ¶¶ 31-35.)
Ultimately, the only evidence
Perlman has presented of financial misconduct is her own declaration
reiterating her allegations, and the declaration of her attorney, Ramy Galal,
indicating the HOA’s production of financial records included five
reimbursement checks from the HOA to the Valeros, only one of which included an
explanation, which revealed the HOA reimbursed the Valeros for cleaning their
own deck. (Galal Decl. ¶¶ 2-4.)
In light of the Valero declaration,
clarifying that the Valeros received partial reimbursements for only those
portions of the cleaning and repairs that pertained to common areas (Valero
Decl. ¶ 33) the Court does not find sufficient evidence presented of financial
misconduct to warrant the “drastic” remedy of appointing a receiver at this
time.
CONCLUSION AND ORDER
For
the foregoing reasons, the Court denies Perlman’s motion to appoint a
receiver.
Perlman shall give notice of
the Court’s ruling and file the notice with a proof of service forthwith.
DATED: November 20, 2024 ________________________________
Michael
E. Whitaker
Judge
of the Superior Court