Judge: Mitchell L. Beckloff, Case: 22STCV12415, Date: 2022-08-05 Tentative Ruling

Case Number: 22STCV12415    Hearing Date: August 5, 2022    Dept: 86

BANK OF THE WEST V. Richwood International, Inc., et al.

Case Number: 22STCV12415

Hearing Date: August 5, 2022

 

[Tentative]       ORDER GRANTING APPLICATION FOR WRIT OF ATTACHMENT

 

This action arises out of a breach of a loan agreement and guaranty.

 

On September 9, 2021, Plaintiff, Bank of the West, filed its complaint against Defendants, Richwood International, Inc. (Richwood) and Debra F. Wu. The complaint contains nine causes of action: (1) breach of promissory note (Richwood); (2) breach of commercial guaranty (Wu); (3) money lent (both Defendants); (4) account stated (both Defendants); (5) fair valuation (both Defendants); (6) claim and delivery (both Defendants); (7) conversion (both Defendants);

(8) appointment of a receiver (Richwood); and (9) injunctive relief (both Defendants).

 

Plaintiff seeks a writ of attachment in the amount of $682,516.06 against Wu. Plaintiff caused the application and supporting paperwork to be served upon Wu on May 18, 2022, 79 days prior to today’s hearing. (Proof of Service filed May 25, 2022.)

 

The court entered a default against Richwood on June 21, 2022. Richwood has not moved the court to set aside the default. (The court notes Richwood purported to answer the complaint two days after the court entered its default.)

 

Any opposition to the issuance of the writ of attachment or objection to the amount sought for attachment must have been filed or served no later than July 29, 2022, five court days prior to the hearing. Where a defendant fails to timely oppose the application for a writ of attachment, “the defendant shall not be permitted to oppose the issuance of the order.” (Code Civ. Proc.

§ 484.060, subd. (a).)

 

On August 2, 2022 at 9:56 p.m., three days before this hearing and after Plaintiff filed and served its notice of non-opposition, Wu filed her “request [for] a brief continuance . . . so that Debra Wu can submit to this court statutory exemption from Right to Attach Order.” (Request  for Brief Continuance filed August 2, 2022.) Wu’s pleading argued she “was not able to fully cooperate with [her] counsel to timely prepare for the exemption list because she was not in good health.” (Ibid.) Wu provided no further explanation and no evidence to support her request.[1]

 

The Application for Writ of Attachment is GRANTED.

 

LEGAL STANDARD

 

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.

     

    (Code Civ. Proc. § 484.090.)

     

    “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.” (Code Civ. Proc. § 484.030.) Statutory attachment procedures are purely creations of the legislature and as such “are subject to ‘strict construction.’ ” (Hobbs v. Weiss (1999) 73 Cal.App.4th 76, 79 [citing Vershbow v. Reiner (1991) 231 Cal.App.3d 879, 882]; see also Nakasone v. Randall (1982) 129 Cal.App.3d 757, 761.) A judge does not have authority to order any attachment that is not provided for by the attachment statutes. (Jordan-Lyon Productions, Ltd. v. Cineplex Odeon Corp. (1994) 29 Cal.App.4th 1459, 1466.) “The declarations in the moving papers must contain evidentiary facts, stated ‘with particularity,’ and based on actual personal knowledge with all documentary evidence properly identified and authenticated.” (Hobbs v. Weiss, supra, 73 Cal.App.4th at 79-80.) “In contested applications, the court must consider the relative merits of the positions of the respective parties and make a determination of the probable outcome of the litigation.” (Id. at 80 [cleaned up].)

     

    ANALYSIS

     

    Probable Validity of Plaintiff’s Claims:

     

    “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.” (Code Civ. Proc. § 481.190.)

     

    The application is based on a claim for breach of a contract, specifically a guaranty. To establish a claim for breach of guaranty, a plaintiff must prove: (1) defendant’s guaranty of another’s performance under a contract; (2) the other party’s failure to perform; and (3) resulting damage. (Torrey Pines Bank v. Superior Court (1989) 216 Cal.App.3d 813, 819-820.)

     

    In support of its breach of guaranty claim against Wu, Plaintiff provides the loan agreements, executed by Wu on Richwood’s behalf as its President, whereby Plaintiff provided money to Richwood according to certain repayment terms. (Collier Decl. ¶¶ 7-8, Ex. 1.) Wu executed the commercial guaranty pursuant to a loan agreement and at Richwood’s request. (Id. ¶ 12, Ex. 2 p. 2.) Wu guaranteed the obligation to induce Plaintiff to provide the loan to Richwood. (Id. at

    ¶ 12.)

     

    Wu appears to be involved in the daily conduct and direction of Richwood. (Id. at ¶ 21.) Wu has interacted with Plaintiff as Richwood’s controller and principal officer. (Ibid.) Wu signed the corporate resolution for Richwood as its President authorizing the loan. (Id. at Ex. 5.) Wu also signed the corporate resolution as Secretary. (Ibid.)

     

    Plaintiff performed its obligations under the loan agreement, but Richwood defaulted and currently owes “as of April 12, 2022 [] the principal sum of $749,499.92, together with accrued interest (including default interest), fees and charges thereon through April 12, 2022 in the amount of not less than $14,727.65.” (Id. ¶¶ 9-11.) Interest is continuing to accrue. (Id. ¶ 11.) Plaintiff made a demand of Richwood to pay the obligation. (Id. at ¶ 10.)

     

    Wu has not honored the guaranty; Richwood’s debt remains outstanding. (Id. ¶ 13.)

     

    Plaintiff’s evidence is sufficient to show the probable validity of Plaintiff’s breach of guaranty claim. Wu has presented no evidence or argument to the contrary.

     

    Accordingly, Plaintiff has demonstrated a probable validity of its claim against Wu.

     

    Basis of Attachment:

     

    The court shall issue a right to attach order if the claim upon which the attachment is based is one upon which an attachment may be issued. (Code Civ. Proc. § 484.090.) “[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.” (Code Civ. Proc. § 483.010, subd. (a).) “If the action is against a defendant who is a natural person, an attachment may be issued only on a claim which arises out of the conduct by the defendant of a trade, business, or profession.” (Code Civ. Proc. § 483.010, subd. (c).)

     

    Plaintiff’s claim is based on a written contract—the loan agreement and the commercial guaranty—and is in excess of five hundred dollars. Accordingly, the court finds Plaintiff’s claim is a proper basis for attachment.

     

    Purpose and Amount of Attachment:

     

    As noted earlier, statutory attachment procedures are purely creations of the legislature and as such “are subject to ‘strict construction.’ ” (Hobbs v. Weiss, supra, 73 Cal.App.4th at 79.) “The declarations in the moving papers must contain evidentiary facts, stated ‘with particularity,’ and based on actual personal knowledge with all documentary evidence properly identified and authenticated.” (Id. at 79-80.) 

     

    Code of Civil Procedure section 484.090 provides 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.” A plaintiff seeking attachment must make this showing.

     

    Here, Plaintiff attests through its Vice President the application for attachment is not sought for a purpose other than the recovery on a claim upon which the attachment is based. (Application ¶ 4.) The amount of attachment is indisputably greater than zero.

     

    Accordingly, the court finds that Plaintiff has complied with this statutory requirement and attachment is sought for a proper purpose.

     

    Subject Property:

     

    Code of Civil Procedure section 487.010, subdivision (c) provides that the following property of a defendant who is a natural person is subject to attachment:

     

    (1) Interests in real property except leasehold estates with unexpired terms of less than one year. 

    (2) Accounts receivable, chattel paper, and general intangibles arising out of the conduct by the defendant of a trade, business, or profession, except any such individual claim with a principal balance of less than one hundred fifty dollars ($150). 

    (3) Equipment. 

    (4) Farm products. 

    (5) Inventory. 

    (6) Final money judgments arising out of the conduct by the defendant of a trade, business, or profession. 

    (7) Money on the premises where a trade, business, or profession is conducted by the defendant and, except for the first one thousand dollars ($1,000), money located elsewhere than on such premises and deposit accounts, but, if the defendant has more than one deposit account or has at least one deposit account and money located elsewhere than on the premises where a trade, business, or profession is conducted by the defendant, the court, upon application of the plaintiff, may order that the writ of attachment be levied so that an aggregate amount of one thousand dollars ($1,000) in the form of such money and in such accounts remains free of levy. 

    (8) Negotiable documents of title. 

    (9) Instruments. 

    (10) Securities. 

    (11) Minerals or the like (including oil and gas) to be extracted.

     

    Code of Civil Procedure section 484.020, subidivision (e) provides: “Where the defendant is a natural person, the description of the property shall be reasonably adequate to permit the defendant to identify the specific property sought to be attached.”

     

    Plaintiff seeks to attach the following property: (1) shares, dividends, distributions, salary, loan repayments or any other payment or claim owing or to be made to Wu from Richwood;

    (2) interests in real property including but not limited to 2038 Salto Drive, Hacienda Heights, California 91745 and 15359 Calle Despensero, Hacienda Heights, California 91745; (3) tangible personal property that Wu controls or property of Wu that another party controls;

    (4) equipment, vehicles, and inventory of a going business in which Wu has an interest including but not limited to Richwood; (5) personal property used as a dwelling in which Wu has an interest; (6) vehicles, vessels, mobile homes or commercial coaches in which Wu has an interest; (7) chattel paper, instruments, negotiable documents, securities in which Wu has an interest; (8) deposit accounts in which Wu has an interest, including but not limited to, accounts with Citibank Bank, as referenced by account numbers ending in 2212 and 2220 and Wu’s social security number; (9) property in any safe deposit box in which Wu has an interest; (10) accounts receivable or general intangibles in which Wu has an interest; (11) estates of a decedent in which Wu has an interest; (12) final money judgments in which Wu has an interest; and (13) money on the premises where a trade, business, or profession is conducted by the Wu.

     

    An application for writ of attachment against a natural person may describe the property to be attached with general categories such as “real property, personal property, equipment . . . .” (See Bank of America v. Salinas Nissan, Inc. (1989) 207 Cal.App.3d 260, 268.) Application ¶ 9(c) sufficiently corresponds to the categories of property specified in Code of Civil Procedure section 487.010. Thus, the property is properly subject to attachment.

     

    CONCLUSION

     

    Based on the foregoing, Plaintiff’s application for the writ of attachment is GRANTED. Plaintiff shall file a $10,000 undertaking prior to issuance of the writ.

     

    IT IS SO ORDERED.

     

    August 5, 2022                                                                       ________________________________

                                                                                                                       Hon. Mitchell Beckloff

                                                                                                                       Judge of the Superior Court

     


[1] Wu’s continuance request indicates Richwood “does not object to Plaintiff’s request for Right to Attach Order.” (Ibid.) Richwood, however, is in default and has no right to be heard in this action.