Jean-Claude Guillosson, et al. v. Curbio, Inc., et al.

DEFENDANTS HARTFORD FIRE INSURANCE COMPANY AND HARTFORD INSURANCE COMPANY OF THE MIDWEST’S MOTION TO DEPOSIT BOND AMOUNTS; CANCEL AND EXONERATE BONDS; DISCHARGE LIABILITY; FOR ATTORNEY FEES AND COSTS; AND TO BE DISMISSED

 

MOVING PARTY: Defendants Hartford Fire Insurance Company and Hartford Insurance Company of the Midwest

RESPONDING PARTY(S): None

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

Plaintiffs Jean-Claude Guillosson and Maureen Mansfield-Guillosson bring this action against Defendants Curbio Inc. and Patal Construction LLC. The action arises after Plaintiffs contracted with the Defendants as co-general contractors for improvements at Plaintiffs’ residence. Plaintiffs allege that Defendants unilaterally abandoned the project after starting work, leaving the project unfinished and defective.  Plaintiffs named Hartford Fire Insurance Company and Hartford Insurance Company of the Midwest as Defendants under the Third Cause of Action for Recovery on Contractors’ License Bonds.

The Hartford Defendants now move to deposit the bond amounts, cancel and exonerate the bonds, discharge their liability, be dismissed, and to recover their attorney’s fees and costs. No oppositions were filed.  [FN 1]

TENTATIVE RULING:

Defendants’ Motion to Deposit Bond Amounts, etc. is GRANTED.

Defendant Hartford Fire Insurance Company and Hartford Insurance Company of the Midwest are ordered to deposit bond amounts of $15,000 and $7,500, respectively, subject to the deduction for attorney’s fees and costs, with the court within 10 days of this Ruling. 

Upon doing so, the bonds will be exonerated, these moving party Defendants’ liability will be discharged, and said Defendants will be dismissed.

Defendants Hartford Fire and Hartford Midwest are awarded $1,525.57 and $1,525.58, respectively, for their respective reasonable attorney’s fees and costs in connection with this motion.

Moving parties are ordered to give notice.

DISCUSSION:

Defendants’ Motion to Deposit Bond Amounts, etc.

A. Legal Standard 

 

Interpleader is a procedure whereby a person holding money or personal property to which conflicting claims are being made by others, can join the adverse claimants and force them to litigate their claims among themselves.  (See Code of Civ. Proc. § 386; Hancock Oil Co. v. Hopkins (1944) 24 Cal. 2d 497, 508; City of Morgan Hill v. Brown (1999) 71 Cal.App.4th 1114, 1122-23.) 

 

Once the stakeholder’s right to interplead is established, and he or she deposits the money or personal property in court, he or she may be discharged from liability to any of the claimants.  This enables the stakeholder to avoid a multiplicity of actions, and the risk of inconsistent results if each of the claimants were to sue him or her separately.  (Cantu v. Resolution Trust Corp. (1992) 4 Cal.App.4th 857, 874; City of Morgan Hill, supra, 71 Cal.App.4th at 1122.) 

 

“An interpleader action is traditionally viewed as two suits: one between the stakeholder and the claimants to determine the stakeholder's right to interplead, and the other among the claimants to determine who shall receive the funds interpleaded ... As against the stakeholder, claimants may raise only matters which go to whether the suit is properly one for interpleader; i.e., whether the elements of an interpleader action are present.”  (State Farm Fire & Cas. Co. v. Pietak (2001) 90 Cal.App.4th 600, 612.) 

 

If the defendant stakeholder claims no interest in the funds or property held, he or she need not file an interpleader cross-complaint.  He or she may simply apply to the court for permission to deposit the money or property with the court clerk, and for an order discharging him or her from further liability to the adverse claimants.  Such order will also substitute the adverse claimants as parties to the action; or, if only money is involved, simply dismiss the stakeholder.  (Code Civ. Proc., §§ 386(a), 386.5.)  The motion must be supported by an affidavit by the stakeholder establishing the ground for interpleader.  (Code Civ. Proc., § 386(a).)  The supporting affidavit must also state that the moving party is “a mere stakeholder with no interest in the amount or any portion thereof and that conflicting demands have been made upon him for the amount by parties to the action…” (Code Civ. Proc., § 386.5.)  Notice of the motion must be served on each of the adverse claimants to the funds or property.  (Code Civ. Proc., §§ 386(a), 386.5.)  “Where a deposit has been made pursuant to Section 386, the court shall, upon the application of any party to the action, order such deposit to be invested in an insured interest-bearing account.”  (Code Civ. Proc., § 386.1.) 

 

Pursuant to § 386(f), the court may also “may enter its order restraining all parties to the action from instituting or further prosecuting any other proceeding in any court in this state affecting the rights and obligations as between the parties to the interpleader until further order of the court.”  (Cal. Civ. Proc. § 386(f).) 

 

B. Analysis

 

Defendants Hartford Fire Insurance Company and Hartford Insurance Company of the Midwest, as sureties of the subject bonds, move to deposit the bond amounts, cancel and exonerate the bonds, discharge their liability, be dismissed, and recover their attorney’s fees and costs. 

Plaintiffs allege they entered into a written home improvement contract with Defendant Curbio as contractor for home improvements. (FAC ¶ 10.) Plaintiff further alleges that Defendant Curbio subcontracted with Defendant Patal to act as co-general contractor on the project. (Id. ¶ 4.)  

Plaintiffs allege the that Defendants Curbio and Patal “filed with the Contractors’ State License Board, respectively Bonds Number: 21BSBII2292 effective since April 20, 2020, and Number: 57BSBIK7194 effective since August 16, 2021, respectively issued by HARTFORD FIRE INSURANCE COMPANY and HARTFORD INSURANCE COMPANY OF THE MIDWEST, each in the amount of $15,000.” (FAC ¶ 45.) 

Defendants represent that Plaintiffs claim $15,000 from the Hartford Fire Bond and $7,500 from the Hartford Midwest Bond. (Monahan Decl. ¶ 4.) Defendants contend they are “mere stakeholders with no interest in the amounts claimed,” and are “willing and ready to deposit the bond amounts of $15,000 and $7,500 with the Clerk of the Court to await disposition of the claims.” (Monahan Decl. ¶ 5.) 

Considering the above, Defendants’ Motion to Deposit Bond Amounts, etc. is GRANTED.

Defendant Hartford Fire Insurance Company and Hartford Insurance Company of the Midwest are ordered to deposit bond amounts of $15,000 and $7,500, respectively, subject to the deduction for attorney’s fees and costs, with the court within 10 days of this Ruling. 

Upon doing so, the bonds will be exonerated, these moving party Defendants’ liability will be discharged, and said Defendants will be dismissed.

C. Attorney’s Fees

The stakeholder may seek reimbursement for its costs and reasonable attorneys’ fees incurred.  (Code Civ. Proc., § 386.6; UAPColumbus JV 326132 v. Nesbitt (1991) 234 Cal.App.3d 1028, 1036.)  The court may order payment thereof out of the funds deposited by the stakeholder. (Code Civ. Proc., § 386.6.) 

The parties ask to split (one-half and one-half) the attorney’s fees and costs in connection with the motion. Hartford Fire seeks $1,489.75 for attorney’s fees and $35.82 for costs “in connection with” depositing the amount of the bond. (Brandt Decl. ¶¶ 2, 3, 4.) Hartford Midwest seeks $1,489.75 for attorney’s fees and $35.83 for costs. (Id.) The fees sought include time to prepare the instant motion, as well as attempts to execute a stipulation for deposit of the bonds before the motion was filed. (Id.)

Finding the rates and time spent in connection with the motion to be reasonable, and without opposition, Defendants Hartford Fire and Hartford Midwest are awarded the requested $1,525.57 and $1,525.58, respectively, for attorney’s fees and costs. The sums should be deducted from the bond amounts. 

IT IS SO ORDERED.

Dated:   June 05, 2024 ___________________________________