Judge: Michael Shultz, Case: 22STCV14534, Date: 2025-05-08 Tentative Ruling

DEPARTMENT 40 - MICHAEL J. SHULTZ  - LAW AND MOTION RULINGS
The Court issues tentative rulings on certain motions.The tentative ruling will not become the final ruling until the hearing [see CRC 3.1308(a)(2)]. If the parties wish to submit on the tentative ruling and avoid a court appearance, all counsel must agree and choose which counsel will give notice. That counsel must 1) email Dept 40 by 8:30 a.m. on the day of the hearing (smcdept40@lacourt.org) with a copy to the other party(ies) and state that all parties will submit on the tentative ruling, and 2) serve notice of the ruling on all parties. If any party declines to submit on the tentative ruling, then no email is necessary and all parties should appear at the hearing in person or by Court Call. 

Case Number: 22STCV14534    Hearing Date: May 8, 2025    Dept: 40

22STCV14534 Samir B. Armaly, et al v. Stephen L. Goodman, et al.

[TENTATIVE] ORDER GRANTING MOTION TO CHARGE MEMBER’S INTEREST IN LLC

[TENTATIVE] ORDER GRANTING MOTION FOR GARNISHMENT OF WAGES OF TERRESA GOODMAN, NON-DEBTOR SPOUSE OF JUDGMENT DEBTOR, STEPHEN GOODMAN

                                                  I.          BACKGROUND

The first amended complaint (FAC) alleges claims for (1) Breach of Contract and (2) Fraud.

       On January 18, 2024, the Court granted Plaintiff’s motion for summary judgment of the FAC. On February 14, 2024, judgment was entered in Plaintiff Armaly’s favor and against Defendants in the amount of $537,611.39. An abstract of judgment was filed on June 18, 2024.

       On July 16, 2024, the Hon. Anne Richardson granted Plaintiff’s motion for assignment order as to Defendant, Steven Goodman’s interest in Improvement Network Investments, LLC.

                                                         II.         ARGUMENTS

Plaintiff moves for an order to charge Goodman’s interest in SLG Consulting Group, LLC (“SLG”). Goodman testified at a judgment debtor examination that he had an interest in the LLC. Plaintiff seeks an order charging Goodman’s interest with the balance of the judgment plus costs and interest totaling over $440,000 and related orders. The debt remains unsatisfied.

No opposition has been filed.

                                                   III.        DISCUSSION

A.      Motion for a charging order.

       Plaintiff is entitled to charge Goodman’s interest in the LLC under Code Civ. Proc., § 708.310 which states:

 "If a money judgment is rendered against a partner or member but not against the partnership or limited liability company, the judgment debtor's interest in the partnership or limited liability company may be applied toward the satisfaction of the judgment by an order charging the judgment debtor's interest pursuant to Section 15907.03, 16504, or 17705.03 of the Corporations Code."

       Service of the motion shall be made personally or by mail. (Code Civ. Proc., § 708.510.) Plaintiff served Stephen Goodman and Terressa Marie Goodman (among other interested parties) by express mail.

       The charging order constitutes a lien on a judgment debtor’s transferable interest and requires the LLC to pay over to the Judgment Creditor any distribution that would otherwise be paid to the judgment debtor. (Corp. Code, § 17705.03.) The court also has authority to appoint a receiver and “make all other orders as necessary” to give effect to the charging order. (Corp. Code, § 17705.03.)  This section is the exclusive remedy to enforce judgment against a member to satisfy the judgment. (Id.)

       To effectuate the charging order, Plaintiff also asks for an order directing the LLC to produce evidence regarding monies owed to the debtor (Goodman). Accordingly, Plaintiff has shown entitlement to the charging order requested.

B.      Motion for Garnishment of Wages

       Plaintiff separately requests an order to garnish the wages of Goodman’s spouse, Terresa Goodman. Goodman has a community property interest in his spouse’s wages. Goodman testified that he has been married to his spouse for 22 years. He testified that his spouse works for a commercial insurance broker in Pleasant Hill, California called Reliance Insurance Broker. Goodman also testified to the non-existence of a prenuptial, post-nuptial, or any other kind of marital or transmutation agreement.

       Community property is subject to enforcement of a money judgment because the debtor has a community interest in the spouse’s wages. (Code Civ. Proc., § 695.020.) The non-debtor spouse’s earnings are deemed community property. (Fam. Code, § 760.) The community estate is liable for a debt incurred by either spouse, regardless of which spouse has the management and control of the property, and “regardless of whether one or both spouses are parties to the debt or to a judgment for the debt." (Fam. Code, § 910)

                                                       IV.        CONCLUSION

       Based on the foregoing the Motion to Charge Member’s Interest in LLC is GRANTED. The Motion For Garnishment of Wages of Terresa Goodman, Non-Debtor Spouse of Judgment Debtor, Stephen Goodman, is also GRANTED.