Judge: Walter P. Schwarm, Case: 30-2023-01306370, Date: 2023-08-01 Tentative Ruling
Plaintiff’s (Ma Lea R. Manaland) Application for Right to Attach Order, Temporary Protective Order, and Order for Issuance of Writ of Attachment (Application), filed on 2-23-23 under ROA No. 10, is DENIED.
Lydig Construction, Inc. v. Martinez Steel Corp. (2015) 234 Cal.App.4th 937, 943-944 (Lydig), explains, “The procedures and grounds for obtaining orders permitting prejudgment writs of attachment are governed by Code of Civil Procedure section 481.010 et seq. Generally, an order of attachment may be issued only in an action for a claim of money that is based upon an express or implied contract where the total amount of such claim is a fixed or ‘readily ascertainable’ amount not less than $500. (§ 483.010, subd. (a).) [¶] Before an attachment order is issued, the court must find all of the following: (1) the claim upon which the attachment is based is one upon which an attachment may be issued; (2) the applicant has established ‘the probable validity’ of the claim upon which the attachment is based; (3) the attachment is not sought for a purpose other than the recovery on the claim upon which the request for attachment is based; and (4) the amount to be secured by the attachment is greater than zero. (§ 484.090.) In order to establish the probable validity of its claim, the applicant must show that it is more likely than not it will obtain a judgment against the defendant (or counterdefendant) on its claim. (§ 481.190.) [¶] An application for a right to attach order must be supported by an affidavit or declaration showing that the applicant, on the facts presented, would be entitled to a judgment on the claim upon which the attachment is based. (§ 484.030.) The affidavit or declaration must state the facts ‘with particularity.’ (§ 482.040.) Except where matters are specifically permitted to be shown upon information and belief, each affidavit or declaration must show that the affiant or declarant, if sworn as a witness, can testify competently to the facts stated therein. (Ibid.) This means that the affiant or declarant must show actual personal knowledge of the relevant facts, rather than the ultimate facts commonly found in pleadings, and such evidence must be admissible and not objectionable.”
“In determining the probable validity of a claim where the defendant makes an appearance, the court must consider the relative merits of the positions of the respective parties and make a determination of the probable outcome of the litigation.” (Loeb & Loeb v. Beverly Glen Music, Inc. (1985) 166 Cal.App.3d 1110, 1120 (Loeb).)
The Complaint, filed on 2-7-23 under ROA No. 2, alleges the first cause of action for breach of contract regarding a promissory note in the amount of $100,000.00. (Complaint, ¶¶ 7, 8, and 12-19.) The Complaint alleges a breach of contract cause of action regarding a deposit of $10,000.00. (Complaint, ¶¶ 9, 20-31.)
On 5-23-23 under ROA No. 21, Defendant (Cromwell Property Holding, LLC) filed a Cross-Complaint alleging breach of a Residential Purchase Agreement (RPA). (Cross-Complaint, ¶¶ 34, 69-73, and Exhibit 2.)
Defendant’s (Cromwell Property Holdings, LLC) Opposition to Plaintiff’s Application for Right to Attach Order/Writ of Attachment (Opposition), filed on 7-25-23 under ROA No. 46, states, “Plaintiff represented to Cromwell that any interest provisions and installment payment provisions in the note would only be a formality, and unenforceable. (Edalat Decl. ¶ 8) Plaintiff represented to Cromwell, and Cromwell relied on the understanding the Promissory Note was not in any way a loan, but to provide security to Cromwell to hold the Property for Plaintiff’s purchase and to cover the costs of remodeling the Property according to Plaintiff’s requests. (Edalat Decl. ¶ 10.)
Thus, the court finds that the Plaintiff’s claims are claims upon which an attachment may issue. (Code Civ. Proc., § 483.010, subd. (a).)
As to the probable validity of Plaintiff’s claims, Plaintiff presents evidence that Plaintiff and Defendant entered into a promissory note on 10-28-22. (Manalad Decl., ¶ 3 and Exhibit A.) Based on the promissory note, the parties agreed that Defendant would repay the $100,000.00 by way of three monthly payments, payment on the maturity date, or a down payment for an escrow. (Manalad Decl., ¶ 3 and Exhibit A.) Defendant has failed to repay this loan. (Manalad Decl., ¶ 3.) On 12-23-22, pursuant to the RPA, Plaintiff deposited $10,000.00 into escrow. (Manalad Decl., ¶ 5, and Exhibits B and C.) Escrow has not returned the $10,000.00 to Plaintiff. (Manalad Decl., ¶ 6.)
Defendant presents evidence that Plaintiff agreed to pay a deposit of $100,000.00 to Defendant “. . . towards the purchase to hold and secured the purchase of the property. . . .” (Edalat Decl., ¶ 7.) According to Defendant, the parties used a promissory note for this payment “. . . because the deposit was sourced from Plaintiff’s business, and the interest provisions were necessary to cloud the purpose of the funds for a legitimate purpose.” (Edalat Decl., ¶ 8.) On 12-28-22, Plaintiff signed a “Contingency Removal” in relation to the RPA. (Edalat Decl., ¶ 19 and Exhibit 3.) The RPA also contains a 3% liquidated damages provision at paragraph 29. (Edalat Decl., ¶ 18 and Exhibit 2.)
Defendant’s evidence shows that there is a dispute over the $110,000.00 between the parties as to whether Defendant breached the promissory note or whether Plaintiff breached the RPA. Weighing the relative merits of the parties’ positions, the court finds that Plaintiff has not carried Plaintiff’s burden of proof to demonstrate the probable validity of Plaintiff’s claims because there is a dispute between the parties as to the promissory note and the RPA. Thus, the court DENIES Plaintiff’s (Ma Lea R. Manaland) Application for Right to Attach Order, Temporary Protective Order, and Order for Issuance of Writ of Attachment filed on 2-23-23 under ROA No. 10.
Defendant is to give notice.