Judge: Peter A. Hernandez, Case: 23PSCV00130, Date: 2024-02-28 Tentative Ruling

Case Number: 23PSCV00130    Hearing Date: February 28, 2024    Dept: K

Plaintiff R.C. Henderson Trust, LLC’s Application for Default Judgment is DENIED without prejudice.

Background   

Plaintiff R.C. Henderson Trust, LLC (“Plaintiff”) alleges as follows:

On May 21, 2015, Plaintiff, through its predecessor in interest, and Adam Selayandia (“Selayandia”) entered into a purchase agreement (“Agreement #1”), whereby Plaintiff purchased from Selayandia his right to receive certain periodic annuity payments, including 10 annual payments of $2,475.72 beginning on April 30, 2016 and ending on April 30, 2025 (the “Agt. #1 Payments”). Per the Agreement, Selayandia was to deliver to Plaintiff a letter of instruction, addressed to the annuity company, New York Life Insurance Company (“NY Life”), directing that the Agt. #1 Payments be sent to Plaintiff at an address designated by Plaintiff.

On November 23, 2015, Plaintiff, through its predecessor in interest, and Selayandia entered into a separate Purchase Agreement (“Agreement #2”) whereby Plaintiff purchased from Selayandia his right to receive 17 annual payments of $2,475.72 beginning on April 30, 2026 and ending on April 30, 2042. Selayandia agreed in writing that the Agt. #2 Payments should be sent by NY Life to Plaintiff. Plaintiff received payments due in April 2016 through April 2021, but did not receive the payment due in April 2022. Plaintiff believes Selayandia has redirected the monies.

On January 17, 2023, Plaintiff filed a complaint, asserting causes of action against Selayandia, NY Life and Does 1-10 for:

1.                  Breach of Contract

2.                  Declaratory Relief

3.                  Conversion

On February 21, 2023, a “Stipulation of Discontinuance with Prejudice” was filed. On March 29, 2023, Plaintiff dismissed the entire action without prejudice.

On May 15, 2023, an “Order Granting Plaintiff R.C. Henderson Trust, LLC’s Motion to Set Aside Dismissal of the Case” was entered.

On June 12, 2023, a “Stipulation and Order of Discontinuance With Prejudice” was entered as between Plaintiff and NY Life.

On July 25, 2023, an “Order for Publication” was entered.

On November 14, 2023, proof of publication was filed; that day, Selayandia’s default was entered.

An Order to Show Cause Re: Default Judgment is set for February 28, 2024.

Discussion

Plaintiff’s Application for Default Judgment is denied without prejudice. The following defects are noted:

1.                  Exhibits A and B to the Declaration of Richard Connelly reflect that the agreements were made between Selayandia and Peachtree Settlement Funding, LLC (“Peachtree”). Plaintiff is requested to explain its relationship with Peachtree and to attach a copy of any assignment, to the extent one exists.

2.                  Plaintiff has alleged the existence of two separate purchase agreements, (1) one made on or about May 21, 2015 between Plaintiff, through its predecessor in interest, and Selayandia involving the purchase of 10 annual annuity payments of $2,475.72 beginning on April 30, 2016 and ending on April 30, 2025 (i.e., “Purchase Agreement”) and (2) a second made on or about November 23, 2015 between Plaintiff, through its predecessor in interest, and Selayandia involving the purchase of 17 annual annuity payments of $2,475.72 beginning on April 30, 2026 and ending on April 30, 2042 (i.e., “Purchase Agreement No. 2”). (Complaint, ¶¶ 4-8). Plaintiff asserts that, although it received the payments due April 2016-April 2021, it did not receive the payment due April 2022 and believes that Selayandia redirected the payment so that he would receive it instead of Plaintiff. (Id., ¶ 12).

Plaintiff “seeks judgment against Defendant for principal of $2,475.72, plus the same amount for each year the annual annuity payment remains diverted . . .” (Emphasis added). The proposed judgment appears problematic to the court. Plaintiff cannot be said to have breached Purchase Agreement No. 2, inasmuch as none of the annuity payments are yet due. Plaintiff appears to acknowledge as much, because its first cause of action for Breach of Contract references only the Purchase Agreement. (Complaint, ¶ 14). The Declaration of Richard Connelly is silent as to whether or not Plaintiff received the payment due on April 30, 2023 under the Purchase Agreement; assuming Plaintiff did not receive same, then it would appear to the court that the principal sought should be $4,951.44 (i.e., $2,475.72 (x) 2 [i.e., for April 2022 and April 2023]).

Paragraph 7 of the proposed judgment reads as follows: “$2,475.72 for each year after 2022 the annual annuity payment remains diverted, plus interest.” It would appear to the court that Paragraph 7 should be amended to state something along the lines that Plaintiff is entitled to receive the payments due April 30, 2024 and April 30, 2025 under the Annuity Purchase Contract dated on or about May 21, 2015 between Peachtree and Selayandia.

It would not appear to the court that declaratory relief or any other relief is available to Plaintiff at this juncture with respect to Purchase Agreement No. 2, again since none of the annuity payments are yet due. The court invites Plaintiff to brief the issue.

3.                   Connelly identifies the $233.24 set forth in Paragraph 2(b)(1) of Judicial Council Form CIV-100 as interest (Connelly Decl., ¶ 11). The court requests that Plaintiff provide an interest calculation and identify this amount in Paragraph 2(c) of Judicial Council Form CIV-100 instead of Paragraph 2(b)(1) therein.