Judge: Michael Shultz, Case: 23STCV31859, Date: 2025-05-06 Tentative Ruling

Case Number: 23STCV31859    Hearing Date: May 6, 2025    Dept: 40

23STCV31859 Columbus R. Starks v. Professional Business Management

[TENTATIVE] ORDER GRANTING MOTION FOR SUMMARY JUDGMENT BY DEFENDANT, PROFESSIONAL BUSINESS MANAGEMENT CORPORATION

                                                                                         I.         BACKGROUND

      The verified complaint to quiet title arises from the sale of residential real property owned by Plaintiff.  Plaintiff alleges he obtained a second mortgage loan from Defendants on December 12, 2022, secured by a deed of trust and promissory note. The complaint alleges that Defendants failed to inform Plaintiff that he was required to pay the second mortgage within 90 days or be subject to foreclosure. Plaintiff alleges Defendants wrongfully foreclosed on the real property based on fraud and Defendants’ predatory lending scheme.

      On March 1, 2024, Plaintiff gave notice of his pending bankruptcy petition. At the October 10, 2024, Case Management Conference, the court noted that all defendants have been dismissed except for Professional Business Management and that the bankruptcy stay had been lifted.

                                                                                          II.        ARGUMENTS

      Defendant, Professional Business Management Corporation (“Defendant”) moves for summary judgment on grounds that the undisputed material facts demonstrate that none of Plaintiff’s claims have merit, and therefore, Defendant is entitled to judgment in its favor.  Defendant also argues, alternatively, that it is entitled to summary adjudication on the first cause of action for quiet title on grounds Plaintiff does not have standing to assert a quiet title claim which is also barred by judicial estoppel.

      Defendant timely served the motion on Plaintiff on January 21, 2025, by mail and electronic mail. Plaintiff did not file an opposition.  

                                                                                  III.       LEGAL STANDARDS

      Summary judgment is proper “if all the papers submitted show that the material facts are undisputed and that the moving party is entitled to judgment as a matter of law.” (Code Civ. Proc., § 437c subd. (c).) The moving party’s burden is to show that based on the undisputed facts “one or more elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense to the cause of action." (Code Civ. Proc., § 437c subd. (p)(2).) If that threshold burden is met, the burden shifts to the opposing party to show a triable issue of one or more material facts. (Code Civ. Proc., §437c(p)(1).)

      A party may move for summary adjudication “as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has no merit, that there is no affirmative defense to the cause of action, that there is no merit to an affirmative defense as to any cause of action, [or] that there is no merit to a claim for [punitive] damages.” (Code Civ. Proc., § 437c subd. (f)(1).) A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty. (Code Civ. Proc., § 437c. subd.(f)(1).)

      The court applies the three-step analysis to motions for summary judgment or adjudication: (1) identify the issues framed by the pleading, (2) determine whether the moving party established facts which negate the opponents’ claim, (3) if the moving party meets its threshold burden of persuasion and the burden shifts, determine whether the opposing party has controverted those facts with admissible evidence. (Torres v. Reardon (1992) 3 Cal.App.4th 831, 836.)

                                                                                                IV.       DISCUSSION

      Defendant’s request for judicial notice of court records in this action and Plaintiff’s Chapter 7 Bankruptcy proceeding, is GRANTED. (Evid. Code, § 452 subd. (d).)

      This case contains one cause of action for quiet title based on various “schemes” engaged in by Defendants. (Complaint). In support of the motion, Defendant asserts two defenses both of which meet Defendant’s threshold burden of showing it is entitled to judgment on the entire complaint. The first argument is that Plaintiff lacks standing to pursue his claims because Plaintiff filed a Chapter 7 petition for bankruptcy protection. Under those circumstances, the right to assert any claims for the benefit of the bankruptcy estate belongs to the Chapter 7 trustee. (Cloud v. Northrop Grumman Corp. (1998) 67 Cal.App.4th 995, 1001 ["The widely accepted rule is that after a person files for bankruptcy protection, any causes of action previously possessed by that person become the property of the bankrupt estate. "]; M & M Foods, Inc. v. Pacific American Fish Co., Inc. (2011) 196 Cal.App.4th 554, 562 ["The commencement of Chapter 7 bankruptcy extinguishes a debtor's legal rights and interests in any pending litigation, and transfers those rights to the trustee, acting on behalf of the bankruptcy estate."].)

      Plaintiff filed a Chapter 7 Bankruptcy petition on December 19, 2023. (UF 3.) The bankruptcy proceeding was discharged. (UF 6).

      The Plaintiff must secure the bankruptcy trustee’s abandonment of the claim in order for Plaintiff to have standing to pursue the action. (Bostanian v. Liberty Savings Bank (1997) 52 Cal.App.4th 1075.)  This argument does not appear to be a valid basis for granting the motion given the bankruptcy proceeding has been discharged. 

      Defendant’s second argument is a complete defense. When a debtor files for Chapter 7 bankruptcy, Plaintiff must disclose all contingent or unliquidated claims against any person. Plaintiff failed to do so, and therefore, judicial estoppel bars Plaintiff from asserting claims that were not disclosed to the bankruptcy court. (UF 3, 4.)

      Judicial estoppel prevents a party from asserting a position in a judicial proceeding that is contrary to or consistent with a position previously asserted. (International Engine Parts, Inc. v. Feddersen & Co. (1998) 64 Cal.App.4th 345, 350.) " If the bankruptcy debtor violates its statutory and fiduciary duty to disclose a current claim during a bankruptcy proceeding, “equitable and judicial estoppel operate as a bar to further litigation by the debtor." (Id.)

      Plaintiff did not file an opposition or an opposing separate statement. Where the Plaintiff fails to oppose the motion and the moving papers are not deficient on its face, the court “has discretion under subdivision (b)(3) to grant the motion, without first undertaking a detailed analysis of the supporting evidence to determine if a prima facie showing has been made as to one or more of the elements of each claim." (Mandell-Brown v. Novo Nordisk Inc. (2025) 109 Cal.App.5th 478, 508.)

                                                                                               V.        CONCLUSION

      Defendant has met its burden of establishing it is entitled to judgment in its favor. (Code Civ. Proc., § 437c(p)(2).) Plaintiff has not provided any argument or evidence to dispute Defendant’s contentions. Accordingly, Defendant’s motion is GRANTED.