Judge Walter P. Schwarm, Case 30-2021-01213582 2022-09-20 Tentative Ruling

Judge: Walter P. Schwarm, Case: 30-2021-01213582, Date: 2022-09-20 Tentative Ruling

Plaintiff’s (Old Republic Surety Company) unopposed Motion to Deposit by Stakeholder; For Discharge of Stakeholder (Motion), filed on 5-17-22 under ROA No. 45, is GRANTED.

Code of Civil Procedure section 386 states, “. . . [¶](b) Any person, firm, corporation, association or other entity against whom double or multiple claims are made, or may be made, by two or more persons which are such that they may give rise to double or multiple liability, may bring an action against the claimants to compel them to interplead and litigate their several claims. . . . [¶] The action of interpleader may be maintained although the claims have not a common origin, are not identical but are adverse to and independent of one another, or the claims are unliquidated and no liability on the part of the party bringing the action or filing the cross-complaint has arisen . . . .”

Code of Civil Procedure Section 386, subdivision (f) provides, “After any such complaint or cross-complaint in interpleader has been filed, the court in which it is filed 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.”

Code of Civil Procedure Section 386.5 states: “Where the only relief sought against one of the defendants is the payment of a stated amount of money alleged to be wrongfully withheld, such defendant may, upon affidavit that he 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, upon notice to such parties, apply to the court for an order discharging him from liability and dismissing him from the action on his depositing with the clerk of the court the amount in dispute and the court may, in its discretion, make such order.”

Code of Civil Procedure Section 386.6, subdivision (a), states: “A party to an action who follows the procedure set forth in Section 386 or 386.5 may insert in his motion, petition, complaint, or cross complaint a request for allowance of his costs and reasonable attorney fees incurred in such action. In ordering the discharge of such party, the court may, in its discretion, award such party his costs and reasonable attorney 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.”

Farmer New World Life Ins. Co. v. Rees (Farmer) (2013) 219 Cal.App.4th 307, 315, states, “ ‘ “The purpose of interpleader is to prevent a multiplicity of suits and double vexation. [Citation.] ‘The right to the remedy by interpleader is founded, however, not on the consideration that a [person] may be subjected to double liability, but on the fact that he is threatened with double vexation in respect to one liability.’ [Citation.]” [Citation.]’ [Citation.] ‘An interpleader action, however, may not be maintained “upon the mere pretext or suspicion of double vexation; [the plaintiff] must allege facts showing a reasonable probability of double vexation” [citation], or a ‘valid threat of double vexation’ [citation].’ [Citation.] [¶] ‘ “In an interpleader action, the court initially determines the right of the plaintiff to interplead the funds; if that right is sustained, an interlocutory decree is entered which requires the defendants to interplead and litigate their claims to the funds.” [Citation.] Then, in the second phase of an interpleader proceeding, the trial court also has “the power under [Code of Civil Procedure] section 386 to adjudicate the issues raised by the interpleader action including: the alleged existence of conflicting claims regarding the interpleaded funds; plaintiffs' alleged position as a disinterested mere stakeholder; and ultimately the disposition of the interpleaded funds after deducting plaintiffs' attorney fees.” [Citation.]’ (Shopoff & Cavallo LLP v. Hyon, supra, 167 Cal.App.4th at pp. 1513–1514, 85 Cal.Rptr.3d 268; see also Dial 800 v. Fesbinder (2004) 118 Cal.App.4th 32, 43, 12 Cal.Rptr.3d 711 [‘interpleader proceeding is traditionally viewed as two lawsuits in one. The first dispute is between the stakeholder and the claimants to determine the right to interplead the funds. The second dispute to be resolved is who is to receive the interpleaded funds’].)” (Italics in Farmer.)

Plaintiff has shown that pursuant to Business and Professions Code Section 7071.6, a $15,000 Contractor’s State License Bond was issued to Miguel Santillan aka Miguel Domaciano Sa Vasquez individually and dba Dream Pools Construction (Miguel Santillan), as principal. (Sosa Decl., ¶ 2.) Old Republic filed a verified Complaint in Interpleader and has served all Defendants except Miguel Santillian who has been evading service and has retained new counsel. (Sosa Decl., ¶¶ 3-4.) “It is OLD REPUBLIC’s position that it does not know and cannot determine the respective merits of the remaining claimants which are conflicting claims against the subject bond and further, has no safe, expedient or economical remedy other than this proceeding in interpleader.” (Sosa Decl., ¶ 8.) Plaintiff has also shown that it has no interest in the proceeds of Bond No. W150401489 and is a mere stakeholder. (Sosa Decl., ¶ 8.)

Based on the above, the court GRANTS Plaintiff’s (Old Republic Surety Company) unopposed Motion to Deposit by Stakeholder; For Discharge of Stakeholder filed on 5-17-22 under ROA No. 45. The court ORDERS Plaintiff to prepare an interlocutory order requiring the defendants to litigate their claims to the interplead funds and Plaintiff’s position as a disinterested stakeholder.

Plaintiff is to give notice.