Judge: Peter A. Hernandez, Case: KC069863, Date: 2022-09-14 Tentative Ruling
Case Number: KC069863 Hearing Date: September 14, 2022 Dept: O
Background
Plaintiff
Chiau-Yu Hsueh aka Angie Hsueh aka Angie Y. Y. Liu (“Plaintiff”) alleges as
follows:
On or about
June 15, 1988, Plaintiff and Defendant Kenny Ming Ho Liu aka Kenny M. Liu aka
Kenny M.H. Liu
(“Liu”) acquired the property located at 10 Tanglewood Drive in Pomona
(“Pomona
Property”). Plaintiff provided a substantial portion of the down payment for
the
purchase of the
Pomona Property. In or around 1990, Plaintiff moved to Taiwan. At the time
Plaintiff left
to Taiwan it was agreed between Plaintiff and Liu that they would continue to
own
the Pomona
Property jointly and Liu would manage and take care of same for their mutual
benefit. Within
the last year, Plaintiff learned that Liu recorded a deed purporting to
transfer title
to the Pomona
Property to himself on or around April 29, 2008 (“Forged Deed”), without
Plaintiff’s
consent. Within the last year Plaintiff also learned that Liu has encumbered
the
Pomona Property
without Plaintiff’s consent through a loan in the principal amount of $118,000,
which loan was
used to purchase the property located at 236 South California Street in San
Gabriel (the
“San Gabriel Property”), as evidenced by a deed of trust recorded April 5, 2012
(the
“Concealed
Trust Deed”). The Forged Deed was falsely notarized by attorney James K. Hedges
(“Hedges”).
On December 6, 2017, Plaintiff filed a complaint, asserting causes of action against Liu, Hedges and Does 1-500 for:
1.
Fraudulent Conveyance of Real Property
2.
Breach of Fiduciary Duty
3.
Violation of Statutes
4.
Cancellation of Written Instruments
5.
Quiet Title
6.
Slander of Title
7.
Partition
8.
Accounting
9. Constructive Trust
On May 8, 2018, Hedge’s default was entered.
On May 21, 2018, Liu filed a cross-complaint, asserting causes of action against Hedges and Does 1-500 for:
1.
Legal Malpractice
2.
Equitable Indemnity
3. Contribution and Apportionment of Fault
On September 24, 2019, the court ordered Hedges dismissed, with prejudice, from Liu’s cross-complaint.
On October 18, 2019, Interlocutory Judgment was filed. On March 16, 2021, an “Amended Interlocutory Judgment” was filed, wherein Matthew Taylor (“Taylor”) was appointed as Partition Referee.
On October 27, 2021, a “Stipulation and Order Confirming Partition Referee’s Sale of San Gabriel Real Property and Related Orders” was filed. On November 24, 2021, Taylor filed a “Notice of Completion of Sale of Real Property in San Gabriel.” On March 9, 2022, a “Stipulation and Order Confirming Partition Referee’s Sale of Pomona Real Property and Related Orders” was filed. On April 11, 2022, Taylor filed a “Notice of Completion of Sale of Real Property (Pomona Property).”
On May 31, 2022 counsel for Liu’s motion to be relieved as counsel was granted.
“The court shall appoint a referee to divide or sell the property [in a partition action] as ordered by the court.” (Code Civ. Proc., § 873.010, subd. (a).) “The court may: . . . (2) Instruct the referee. (3) Fix the reasonable compensation for the services of the referee and provide for payment of the referee's reasonable expenses. . . (5) Require the filing of interim or final accounts of the referee, settle the accounts of the referee, and discharge the referee . . .” (Code Civ. Proc., § 873.010, subd. (b).)
“The referee or any party may, on noticed motion, petition the court for instructions concerning the referee's duties under this title.” (Code Civ. Proc., § 873.070.)
“The costs of partition include: . . .The fee and expenses of the referee.” (Code Civ. Proc., § 874.010, subd. (b).) “The proceeds of sale for any property sold shall be applied in the following order: (a) Payment of the expenses of sale. (b) Payment of the other costs of partition in whole or in part or to secure any cost of partition later allowed. (c) Payment of any liens on the property in their order of priority except liens which under the terms of sale are to remain on the property. (d) Distribution of the residue among the parties in proportion to their shares as determined by the court.” (Code Civ. Proc., § 873.820.)
“The court shall order the proceeds of sale and any security therefor to be paid, transferred, deposited in court, placed in trust, or invested in State of California or United States government obligations or interest-bearing accounts in an institution whose accounts are insured by an agency of the federal government, to or for the benefit of the persons in interest entitled thereto, as may be appropriate or as specifically provided in this article.” (Code Civ. Proc., § 873.810.)
“When the proceeds of the sale belonging to persons who are parties to the action, whether known or unknown, have not been allocated among such parties, the action may be continued as between such parties, for the determination of their respective claims thereto, which must be ascertained and adjudged by the court. Further testimony may be taken in court, or by a referee, at the discretion of the court, and the court may, if necessary, require such parties to present the facts or law in controversy, by pleadings, as in an original action.” (Code Civ. Proc., § 873.850.)
Discussion
Taylor moves the court for (1) discharge and (2) instructions regarding the disposition of the remaining money (i.e., $835,662.67) being held. Taylor seeks approval of fees incurred in this matter in the amount of $24,550.00 and an order to pay those fees from funds generated by the sale of the Pomona Property and San Gabriel Property. Taylor also seeks permission to pay $5,127.00 in fees and costs incurred by the prior Partition Referee Mitchell Roth (“Roth”), now deceased. Taylor recommends that the court order him to deposit the remaining funds (after payment of the requested professional fees) to the clerk of the court to be held until the court issues a final order as to the disposition of the funds.
On October 27, 2021, the court confirmed a sale of the San Gabriel Property to Liu, as buyer, for $800,000.00. Following payment through escrow of costs of sale, mortgages, liens, etc., Taylor received $219,464.05 including Liu’s initial deposit paid directly to Taylor. (Taylor Decl., ¶ 5, Exh. 1.) On March 9, 2022, the court confirmed a sale of the Pomona Property to buyers Johnny Ho and Jennifer Lam for $755,000.00. Following payment through escrow of costs of sale, liens, etc., Taylor received $619,720.82 including buyers’ initial deposit paid directly to Taylor. (Id., ¶ 6, Exh. 2.)
Taylor’s summary accounting is attached as Exhibit 3. (Id., ¶ 7.) Said document reflects a total income of $841,184.86 and total costs of $5,522.19 during the March 16, 2021 to April 11, 2022 time period, for a total remaining amount of $835,662.67.
Taylor’s request for payment of $24,55.00 in professional fees for his work on the case is set forth in Exhibit 5. (Id., ¶ 4.) Taylor served these charges on the parties in the form of periodic invoices and never received any objections to same. (Id.) Additionally, Taylor represents that on February 14, 2022 he received a claim for $2,280.00 in fees and $2,847.00 in cost reimbursements from attorney Layne Bartholomew, as Practice Administrator for Roth. (Id., ¶ 9, Exh. 4.)
The court, having
received no opposition to the foregoing motion, is inclined to grant the
proposed order in its entirety. The clerk of the court is to hold the
$805,985.67 remaining balance until further order of the court. The court
declines Plaintiff’s request to make a determination regarding disbursement on
this date.