Judge: Stephen P. Pfahler, Case: 21CHCV00810, Date: 2022-08-03 Tentative Ruling

Case Number: 21CHCV00810    Hearing Date: August 3, 2022    Dept: F49

Dept. F-49

Date: 8-3-22

Case #21CHCV00810

STAKEHOLDER DEPOSIT

MOVING PARTY: Defendant/Cross-Complainant-in-Interpleader, Western Surety Company  

RESPONDING PARTY: Unopposed/Plaintiff/Cross-Defendant, Rick Hamm Construction, Inc., et al.

RELIEF REQUESTED

Motion for Stakeholder Deposit and Discharge of Stakeholder

SUMMARY OF ACTION

Plaintiff Rick Hamm Construction, Inc. alleges entry into a sub-contract with Avex Builders, Inc. on December 28, 2020 for certain demolition and concrete work on a construction project located at 9223 Owensmouth Ave., Chatsworth. The total contract sum was $161,995. Plaintiff alleges an outstanding balance of $131,995 due. Plaintiff also seeks $3,500 in materials also agreed upon pursuant to a second written contract executed on March 17, 2021.

On October 14, 2021, Plaintiff filed a complaint for Money Due on Contract, Foreclosure of Mechanics Lien, Account Stated, Open Book Account, Reasonable Value of Labor and Materials Furnished, Violation of Prompt Payment Statutes, and Claim on Contractors License Bond. On November 19, 2021, Defendant Western Surety Company filed a general denial, and cross-complaint for interpleader.

On January 3 and 7, 2022, Abex Builders, Inc., and Danone US, LLC answered the complaint. On January 18 and 20, 2022, Avex Builders, Inc. and Rick Hamm Construction, Inc. answered the Western Surety Company cross-complaint.

On April 7, 2022, the clerk entered defaults against No Limit Flooring and Edon Primrose Corporation dba Diamond Glass on the Western Surety cross-complaint. On April 25, 2022, Defendant Danone US, LLC filed a cross-complaint against Avex Builders, Inc. for Equitable Indemnity/Unjust Enrichment.

On April 28, and July 13, 2022, Western Surety Company substituted in J.H. Bryant Jr., Inc. and The Pegasus School for Roes 6 and 7. Western Surety Company dismissed J.H. Bryant Jr., Inc. on May 5, 2022.50

RULING: Granted.

Defendant/Cross-Complainant-in-Interpleader, Western Surety Company moves for leave to deposit the $7,500 contractors bond with the court, and discharge from the action. The motion is unopposed.

Code of Civil Procedure section 386 states in relevant part:

A defendant, against whom an action is pending upon a contract, or for specific personal property, may, at any time before answer, upon affidavit that a person not a party to the action makes against him, and without any collusion with him, a demand upon such contract, or for such property, upon notice to such person and the adverse party, apply to the court for an order to substitute such person in his place, and discharge him from liability to either party, on his depositing in court the amount claimed on the contract, or delivering the property or its value to such person as the court may direct; ¿and the court may, in its discretion, make the order; ¿or such defendant may file a verified cross-complaint in interpleader, admitting that he has no interest in such amount or such property claimed, or in a portion of such amount or such property and alleging that all or such portion of the amount or property is demanded by parties to such action or cross-action and apply to the court upon notice to such parties for an order to deliver such property or portion thereof or its value to such person as the court shall direct. And whenever conflicting claims are or may be made upon a person for or relating to personal property, or the performance of an obligation, or any portion thereof, such person may bring an action against the conflicting claimants to compel them to interplead and litigate their several claims. The order of substitution may be made and the action of interpleader may be maintained, and the applicant or interpleading party be discharged from liability to all or any of the conflicting claimants, although their titles or claims have not a common origin, or are not identical but are adverse to and independent of one another.

(Code Civ. Proc., § 386, subd. (a).)

A defendant who holds property to which various persons are asserting conflicting claims and in which he has no interest other than as stakeholder may bring a motion under Code of Civil Procedure section 386. (Cantu v. Resolution Trust Corp. (1992) 4 Cal. App. 4th 857, 875.) The moving party only need “file a disclaimer relinquishing any purported claim to the stake.” (Ibid.) “Once the [party] admits liability and deposits the money with the court, [the party] is discharged from liability and freed from the obligation of participating in the litigation between the claimants.” (City of Morgan Hill v. Brown (1999) 71 Cal.App.4th 1114, 1122.)

Western Surety Company provided a $7,500 bond to Avex Builders, Inc. pursuant to Business and Professions Code section 7071.6. The bond exists for the benefit of persons harmed by a contractor’s actions. Multiple parties assert claims against Avex Builders, Inc. The court finds no other basis of liability against Western Surety Company, and therefore grants the motion for deposit and discharge of all liability claims on the bond. (Code Civ. Proc., § 386, subd. (b).)

The court also grants the motion for restraining order barring either new actions or further prosecution of claims against Western Surety Company. (Code Civ. Proc., § 386, subd. (f).) Dismissal effective upon deposit of the funds with the court. (Code Civ. Proc., § 386.5.)

Western Surety also moves for $1,500 in attorney fees and costs. “In ordering the discharge of such party, the court may, in its discretion, award such party his costs and reasonable attorneys’ fees from the amount in dispute which has been deposited with the court. At the time of final judgment in the action the court may make such further provision for assumption of such costs and attorney fees by one or more of the adverse claimants as may appear proper.”  (Code Civ. Proc., § 386.6, subd. (a); UAP-Columbus JV 326132 v. Nesbitt (1991) 234 Cal.App.3d 1028, 1036; Great West-Life Assur. Co. v. Superior Court (1969) 271 Cal.App.2d 124, 128.) The amount of attorney fees and costs must be restricted to those incurred as to the interpleader remedy. (Sweeney v. McClaran (1976) 58 Cal.App.3d 824, 830-831.)

The motion is therefore granted in its entirety.

Defendant/Cross-Complainant to give notice.