Judge: Thomas Falls, Case: 21PSCV00782, Date: 2022-08-31 Tentative Ruling

The Court may change tentative rulings at any time. Therefore, attorneys are advised to check this website to determine if any changes or updates have been made to the tentative ruling. Counsel may submit on the tentative rulings by calling the clerk in Dept. R at 909-802-1117 before 8:30 the morning of the hearing.

Case Number: 21PSCV00782    Hearing Date: August 31, 2022    Dept: R

Randall Zorn v. Michael Zorn, et al. (21PSCV00782)

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Plaintiff’s MOTION FOR SUMMARY AND ENTRY OF INTERLOCUTORY JUDGMENT F'OR PARTITION OF'REAL PROPERTY BY SALE

Tentative Ruling

Plaintiff’s MOTION FOR SUMMARY AND ENTRY OF INTERLOCUTORY JUDGMENT F'OR PARTITION OF'REAL PROPERTY BY SALE is DENIED.

Background

This is a real property dispute. Plaintiff RANDALL ZORN (“Plaintiff”) alleges the following against Defendants MICHAEL ZORN; JOANNA N. ZORN; JULIE ZORN; 7-ELEVEN, INC.,[1] a Texas corporation, formerly known as "The Southland Corporation" and DOES 1-20 (collectively, “Defendants”): This action concerns certain real property located at 730 E. Foothill Boulevard, Pomona California 91767 (“Subject Property”). From at least January 22, 2021 to the present, title and ownership to the real property has been and is held as follows:

Randall Zorn owns an undivided 1/2 interest in the entirety of the real property, holding title as a tenant in common with the remaining owners; (2) Joanna N. Zorn owns an undivided 1/3 interest in the entirety of the real property, holding title as a tenant in common with the remaining owners; (3) Michael Zorn owns an undivided 1/12 interest in the entirety of the real property, holding title as a tenant in common with the remaining owners; and (4) Julie Zorn owns an undivided 1/12 interest in the entirety of the real property, holding title as a tenant in common with the remaining owners.

(Complaint ¶2.)[2]

Plaintiff wishes to sell the real property and divide the sale proceeds pursuant to percentage ownership, but Defendants refuse. Partition in kind is neither practical nor desired because (i) an ordinance and (ii) even if not prohibited by ordinance, a partition in kind would be impractical due to the (a) exorbitant expense in converting the building to multiple separate sections; (b) it would destroy the aesthetic appearance; and (iii) adversely affect its marketability and market value. (Complaint ¶9.)

On September 24, 2021, Plaintiff filed suit against Defendants for PARTITION OF REAL PROPERTY BY SALE.

On December 3, 2021, Defendants Julie and Michael Zorn filed a Cross-Complaint against Plaintiff for ACCOUNTING.[3]

On June 15, 2022, Plaintiff filed the instant Motion for Summary Judgment And Entry Of Interlocutory Judgment For Partition Of Real Property By Sale (“MSJ”).

On August 12, 2022, Defendants JULIE ZORN, JOANNA N. ZORN AND MICHAEL ZORN filed their Opposition to the MSJ.

As of August 25, 2022, no Reply has been received (due five court days before a hearing).

Legal Standard

The function of a motion for summary judgment or adjudication is to allow a determination as to whether an opposing party cannot show evidentiary support for a pleading or claim and to enable an order of summary dismissal without the need for trial. Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843. In analyzing such motions, courts must apply a three-step analysis: “(1) identify the issues framed by the pleadings; (2) determine whether the moving party has negated the opponent's claims; and (3) determine whether the opposition has demonstrated the existence of a triable, material factual issue.” Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 294.  Thus, summary judgment or summary adjudication is granted when, after the Court’s consideration of the evidence set forth in the papers and all reasonable inferences accordingly, no triable issues of fact exist and the moving party is entitled to judgment as a matter of law.  CCP § 437c(c); Villa v. McFarren (1995) 35 Cal.App.4th 733, 741. 

As to each claim as framed by the complaint, the party moving for summary judgment or summary adjudication must satisfy the initial burden of proof by presenting facts to negate an essential element. Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520. Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.” Dore v. Arnold Worldwide, Inc.¿(2006) 39 Cal.4th 384, 389. A motion for summary judgment or summary adjudication must be denied where the moving party's evidence does not prove all material facts, even in the absence of any opposition or where the opposition is weak.  See Leyva v. Superior Court (1985) 164 Cal.App.3d 462, 475; Salesguevara v. Wyeth Labs., Inc. (1990) 222 Cal.App.3d 379, 384, 387.   

Once the moving party has met the burden, the burden shifts to the opposing party to show via specific facts that a triable issue of material facts exists as to a cause of action or a defense thereto.  CCP § 437c(o)(2).  When a party cannot establish an essential element or defense, a court must grant a motion for summary adjudication.  CCP § 437c(o)(1)-(2). 

Discussion

 “A partition action may be commenced and maintained by any of the following persons: (1) A co-owner of personal property.  (2) An owner of an estate of inheritance, an estate for life, or an estate for years in real property where such property or estate therein is owned by several persons concurrently or in successive estates.” CCP § 872.210(a).  “The court shall order that the property be divided among the parties in accordance with their interests in the property as determined in the interlocutory judgment.”  CCP § 872.810. 

“Notwithstanding¿Section 872.810, the court shall order that the property be sold and the proceeds be divided among the parties in accordance with their interests in the property as determined in the interlocutory judgment in the following situations: (a) The parties agree to such relief, by their pleadings or otherwise.  (b) The court determines that, under the circumstances, sale and division of the proceeds would be more equitable than division of the property.  For the purpose of making the determination, the court may appoint a referee and take into account [the referee’s] report.”  CCP § 872.820.² 

The co-owner of a property has “an absolute right to partition unless barred by a valid waiver.”  (LEG Investments v. Boxler (2010) 183 Cal.App.4th 484, 493.) Under the prior law, the party seeking partition by sale as opposed to partition in kind had the burden to establish sale was necessary to avoid “great prejudice.”  (Butte Creek Island Ranch v. Crim (1982) 136 Cal.App.3d 360, 365.) But the Legislature’s 1976 enactment of CCP §§ 872.810 and 872.820 expanded the availability of partition by sale and while the statutes continued the preference for partition in kind, the standard was reduced from a burden to show “great prejudice” to a showing that partition by sale would be “more equitable.”  (Id.; Richmond v. Dofflemyer (1980) 105 Cal.App.3d 745, 754) (emphasis added). This was in part due to a recognition that “[i]n many modern transactions, sale of the property is preferable to physical division since the value of the divided parcels frequently will not equal the value of the whole parcel before division. Moreover, physical division may be impossible due to zoning restrictions or may be highly impractical, particularly in the case of urban property.” (Butte Creek 136 Cal.App.3d at 365.) But the statutes did not overturn the burden of proof remaining on the party seeking partition by sale instead of partition in kind as partition in kind remains favored by the law and in the absence of proof to the contrary the presumption for partition in kind will prevail because a forced sale is strongly disfavored.  (Id) (emphasis added).

Furthermore, the Butte court explained that:

There are two types of evidence which have been held sufficiently to justify a partition sale of property rather than physical division. The first is evidence that the property is so situated that a division into subparcels of equal value cannot be made. [citation omitted] . . . In order to meet this test the party desiring partition sale must show that the land cannot be divided equally. [citation omitted] . . . The second type of evidence which supports a partition sale rather than physical division is economic evidence to the effect that, due to the particular situation of the land, the division of the land would substantially diminish the value of each party’s interest . . . This is a purely economic test. If plaintiff, who demands that the land be sold, can receive a portion of the land through physical division and that portion could be sold for a sum equal to the amount it could realize through sale of the entire parcel then as a matter of law no economic prejudice can be shown.

(Id. at 367.)

Lastly, the judgment of partition is left to the discretion of the trial court and the determination of whether partition by sale is more equitable than physical division requires a factual inquiry by the court and when the evidence, even though conflicting, permits the court to reasonably conclude partition by sale would be more equitable to the owners such decision should be upheld absent an abuse of discretion.  See Richmond v. Dofflemyer (1980) 105 Cal.App.3d 745, 758-59, 765-66; Formosa Corp. v. Rogers (1951) 108 Cal.App.2d 397, 411-12 (abuse of discretion standard applied under prior version of partition law requiring showing of “great prejudice” for finding of partition by sale). This is because “a partition suit is in equity” and “a court of equity has broad powers and comparatively unlimited discretion to apply.”  Richmond 105 Cal.App.3d at 758; Cunningham v. Frymire (1958) 160 Cal.App.2d 726, 729 (the trial court’s decision will not be disturbed “if there is any substantial evidence” in support and an appellate court will not weigh questions of fact determined by the trial court in a partition action). 

Plaintiff’s Burden[4]

First, as to whether partition is impractical, Plaintiff argues that the real property contains two joined rental spaces, and there is no practical, fair or reasonable way to partition the land and building in kind.” (Motion p. 4, citing Statement of Undisputed Fact (“SUF”) Nos. 7.)

Second, presumably as to the economic test, Plaintiff advances three arguments.

First, Defendants have breached their fiduciary duties as cotenants have “initiated a Phase 1 toxicity study of the land, to create knowledge on behalf of the owners of a potential environmental hazard on the land, legally requiring this knowledge to be disclosed in any potential sale, and did so without consulting Randall, and without providing proof any lender required it, and in apparent attempts to reduce the desirability and potential sale value of the property and to make Randall's Zorn's share more affordable for them to purchase themselves.” (Motion pp. 5-6, citing SUF No. 19, see also Winchell Decl., Ex. A) (emphasis added).

Second, Plaintiff states that Defendants have “openly harassed their tenant of 40 years, 7-Eleven, and refuse to cooperate in renewal of the lease with that tenant that expires this year, ‘until they own the property’, with the intent to reduce the desirability and potential sale value of the property and make Randall's share more affordable for them to purchase.” (Motion p. 6, citing SUF No. 21.)  

Lastly, Plaintiff argues that Defendants “have never made any formal offer to Plaintiff to purchase his ownership interest and have not provided any proof that they have ever sought financing to do so.” (Motion p. 5, citing SUF No. 17.)

Here, however, the court finds that Plaintiff has not provided evidence to substantiate any of its claims. For example, as to the argument that physical division is seemingly impossible, Plaintiff has offered no evidence to show that just because the real property consists of commercial land with a building containing adjoined retail rental spaces that the Real Property cannot be divided into subparcels of equal value. For that reason alone, Plaintiff has failed to meet its evidentiary burden.

Furthermore, as to statements that Defendants are engaged in conduct that decrease the value of the property, Plaintiff again fails to offer evidence of such (i.e., expert evidence from a real estate manager).[5]

Therefore, Plaintiff has not met its burden to show that partition by sale is more equitable in this situation.

Defendants’ Burden

Though Plaintiff has not met its evidentiary burden (meaning the court need not considering Defendants’ burden), the court briefly does so because Defendants offer direct contradictory evidence to Plaintiff’s key argument: Defendants in trying to keep the property within the family have made three (3) good faith offers to purchase Plaintiff’s interest in the Real Property to keep the property in their family. (See Dec of Joanna Zorn Decl., ¶¶4-6, see also Ex. 3.)[6] This fact speaks to the fundamental question as to whether partition by sale would be more equitable. Here, it appears that Plaintiff has refused offers, a decision which jeopardizes the preservation of the property in the family. Thus, Defendants have offered evidence that partition by sale would not be more equitable to the owners.[7]

Conclusion

All in all, while Plaintiff as a co-owner of the property has a right to seek partition, he must provide evidence to support that right. However, as Plaintiff only provided his own self-serving declaration that partition by kind is impractical, he failed to meet his burden that no triable issue of material fact exists. Thus, Plaintiff’s MSJ is DENIED.