Judge: William A. Crowfoot, Case: 23AHCV01295, Date: 2024-02-29 Tentative Ruling

Case Number: 23AHCV01295    Hearing Date: February 29, 2024    Dept: 3

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES - NORTHEAST DISTRICT

On June 7, 2023, Plaintiff RSP Holdings, Inc. (“RSP”) filed this action against defendants Rebecca Swimmer (“Swimmer”) and Sterling Vet Corp. (“Sterling Vet”) to recover $216,743.70 for construction services provided to build a pet hospital.

On September 28, 2023, Swimmer and Sterling Vet filed a cross-complaint against RSP for breach of contract and negligence alleging that RSP performed defective work, made illegitimate change orders which caused construction delays, and did not complete the project. As a result, Swimmer and Sterling allegedly sustained damages of $775,000 in change orders on a $1.4 million base contract, $3 million for costs related to the delays, $150,000 for completion costs, and $175,000 for repair costs. Swimmer and Sterling Vet also filed a claim for recovery on a contractor’s license bond in the amount of $15,000, which is asserted against RSP and moving party, Wesco Insurance Company (“Wesco”).

On January 8, 2024, Wesco filed this motion for interpleader and request for attorney’s fees. Wesco seeks to interplead funds of $7,500, less attorneys’ fees and costs of $2,645. The motion is unopposed.

A complaint in interpleader allows an obligor to require parties with conflicting claims to litigate those claims against each other, instead of against the obligor. (Code Civ. Proc., § 386, subd. (b).) The purpose of interpleader is to prevent a multiplicity of suits and double vexation. (City of Morgan Hill v. Brown (1999) 71 Cal.App.4th 1114, 1122.) “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 Civ. Proc., § 386.5.) A party who follows the procedure under Code of Civil Procedure, section 386.5, may request costs and reasonable attorney fees incurred in the action, which the court may award from the amount in dispute that has been deposited with the court. (Code Civ. Proc., §¿386.6(a).)

Wesco seeks leave to interplead and deposit $7,500 because: (1) it is subject to a claim by Sterling and Swimmer and (2) it is entitled to reimbursement from RSP under the terms of an indemnity agreement and Civil Code section 2847. Wesco states that the $7,500 to be interpleaded will either be due and owing to RSP or Sterling and Swimmer because pursuant to Business and Professions Code section 7071.6, the aggregate liability of a surety like Wesco on claims brought against the bond at issue shall not exceed $7,500. The remaining $7,500 “shall be reserved exclusively for the claims of the beneficiaries specified in subdivision (a) of Section 7071.5.” (Bus. and Prof. Code, § 7071.6.) It is undisputed that neither Swimmer nor Sterling Vet are considered beneficiaries pursuant to Section 7071.5 and that they are only entitled to $7,500 at most pursuant to Business and Professions Code section 7071.6(b).

Additionally with respect to Wesco’s request for attorneys’ fees and costs, Wesco’s counsel declares that his billing rate is $215 per hour. (Chang Decl., ¶ 10.) He states that he has spent 6 hours preparing this motion and corresponding papers and anticipates spending an additional 4 hours to review an opposition brief, prepare a reply brief, and attend the hearing, for a total of 10 hours. (Chang Decl., ¶ 10.) Counsel’s declaration does not include a request for costs and does not substantiate the request in Wesco’s moving papers and notice of non-opposition for $495 in costs. Therefore, the Court only awards attorneys’ fees. Furthermore, the motion is unopposed, therefore Wesco’s attorneys’ fees request is reduced to only include the time spent to prepare this motion.

Accordingly, Wesco’s motion is GRANTED and Wesco is ordered to deposit $7,500 with the Court, less $1,290 in attorneys’ fees. Upon the deposit of said funds, Wesco shall be discharged from all liability on account of the claims of the parties and dismissed from this action with prejudice.

Dated this 29th day of February, 2024

Parties who intend to submit on this tentative must send an email to the Court at ALHDEPT3@lacourt.org indicating intention to submit on the tentative as directed by the instructions provided on the court website at www.lacourt.org. Please be advised that if you submit on the tentative and elect not to appear at the hearing, the opposing party may nevertheless appear at the hearing and argue the matter. Unless you receive a submission from all other parties in the matter, you should assume that others might appear at the hearing to argue. If the Court does not receive emails from the parties indicating submission on this tentative ruling and there are no appearances at the hearing, the Court may, at its discretion, adopt the tentative as the final order or place the motion off calendar.