Judge: Robert S. Draper, Case: 21STCV11186, Date: 2023-04-24 Tentative Ruling
Case Number: 21STCV11186 Hearing Date: April 24, 2023 Dept: 78
Superior Court of California
County of Los Angeles
Department 78
IN RE:
4737 Don Porfirio Place, Los Angeles, CA 90008 Case No.: 21STCV11186
Hearing Date: April 24, 2023
[TENTATIVE] RULING RE:
CLAIMANT VIJAY FADIA’S MOTION FOR DISBURSEMENT OF SUPRLUS FUNDS.
Claimant Vijay Fadia’s Motion for Disbursement of Surplus Funds is GRANTED in the amount of $31,730.00.
Moving party to provide notice and to file proof of service of such notice within five court days after the date of this order.
FACTUAL BACKGROUND
This is a petition regarding unresolved claims and deposit of undistributed surplus proceeds of a trustee’s sale. The Amended Petition (“AP”) alleges as follows. Non-Party Mattie Belinda Evans executed a deed of trust for the Subject Property on April 28, 2008. (AP ¶ 3.) A trustee’s sale was held for the Subject Property on September 16, 2020, and the property was sold for $931,000 with surplus proceeds of $386,743.80. (AP ¶ 4.) The trustee, Prestige Default Services, LLC (“Prestige”) filed this action to resolve the conflicts between the potential claimants to the surplus proceeds. (AP ¶¶ 9-12.)
PROCEDURAL HISTORY
On March 23, 2021, Prestige filed the original Petition.
On April 23, 2021, Claimant Vijay Fadia (“Fadia”) filed a Motion for Disbursement of Surplus Funds.
On June 21, 2021, Prestige filed the Amended Petition.
On June 22, 2021, the Court ordered that Prestige was to be awarded its costs and fees, and then to deposit the undistributed surplus proceeds of $386,473.80 with the clerk of court. The Court then dismissed Prestige from this action with prejudice.
On August 4, 2021, the Court heard Fadia’s Motion for Disbursement of Surplus Funds. The Court stated that it intended to grant Fadia’s motion, but needed Fadia to supply additional information, as discussed below.
On September 22, 2021, Claimant Kevin McDowell (“McDowell”), successor trustee of the Mattie B. Evans Family Trust, filed a Motion for Order for Disbursement of Surplus Funds. In that motion, McDowell requested disbursement of the surplus funds, minus Fadia’s $37,130 claim, and McDowell stated the “Trust makes no objections to his valid claim.”
On September 26, 2022, Fadia filed the instant Motion for Disbursement of Surplus Funds.
On November 9, 2022, the Court ordered the disbursement of $354,743.80 to Kevin R. McDowell, Successor Trustee of the Mattie B. Evans family Trust.
As of April 19, 2023, no Opposition has been filed to the instant motion. Any Opposition was due by April 11, 2023.
DISCUSSION
I. MOTION FOR DISBURSEMENT OF SURPLUS FUNDS
Claimant Vijay Fadia moves for a disbursement of surplus funds in the amount of $31,730.00.
When a trustee’s sale is concluded and there are surplus funds, the trustee has 30 days from the execution of the trustee’s deed to send written notice to individuals with a recorded interest in the real property prior to the trustee’s sale. (Civ. Code § 2924j(a).) This allows those individuals to make a claim to the surplus funds. (Civ. Code § 2924j(a)(4).) Once claims have been received, the trustee must exercise due diligence to determine the priority of the claims. (Civ. Code § 2924j(b).) If there is no dispute as to the priority, the trustee pays out the funds within 30 days after the conclusion of the notice period. (Civ. Code § 2924j(b).) If the trustee fails to determine priority or there is a dispute, the trustee must deposit the funds with the court pursuant to Civil Code § 2924j(c).)
The Court “shall consider all claims filed at least 15 days before the date on which the hearing is scheduled with the court.” (Civ. Code § 2924j(d).) The Court determines priority according to Civil Code § 2924k(a): (1) the costs and expenses incurred in the selling of the property, (2) payment of any obligations secured by the deed or mortgage, (3) to satisfy any outstanding obligations encumbering the property, and (4) to the vested owner at the record time of the trustee’s sale. (Civ. Code § 2924k(a)(1-4).)
Here, the Court ordered Prestige to deposit the surplus funds of $386,473.80 with the clerk of the court on June 22, 2021. At the hearing on Fadia’s Motion for Disbursement, the Court stated that it “intended to grant” Fadia’s motion, but acknowledged Prestige’s concern that Fadia’s purported recorded deed of trust appeared to either be a wild deed or unrecorded, and that Prestige was unable to determine if disbursement to Fadia was appropriate. Additionally, the Court acknowledged the Trust’s uncertainty about the validity of Fadia’s claim.
Accordingly, the Court ordered Fadia to provide testimony regarding the current status of the promissory note and Prestige’s allegations regarding the recording of the Deed of Trust.
In the instant motion, Fadia has provided supplemental evidence demonstrating the validity of his claim.
First, Fadia attests that the promissory note remains unpaid with the balance owed and due of $31,730.00. (Fadia Decl. ¶ 5.)
Second, Fadia attaches the Deed of Trust recorded on September 7, 2018, as Instrument No. 20180913889 in the Official Records of Los Angeles County Recorder’s Office. (Id. ¶ 6; Exh. A.) That document shows that Mattie B. Evans, Trustee of the Mattie B. Evans Family Trust secured a debt of $30,000 to Fadia Evans against the power of sale in the Subject Property. (Ibid.)
Third, the Court notes that after the previous hearing on Fadia’s motion, the Trust acknowledged Fadia’s claim as valid.
Finally, the Court notes that no Opposition has been filed as to Fadia’s motion.
Accordingly, Claimant Vijay Fadia’s Motion for Disbursement of Surplus Funds is GRANTED in the amount of $31,730.00.
DATED: April 24, 2023
__________________________
Hon. Jill T. Feeney
Judge of the Superior Court
