Oct 01, 2014

LAW & MOTION TENTATIVE RULINGS

TUESDAY, SEPTEMBER 30, 2014 - 8:30 a.m.

COURTROOM 19 – Judge J. Michael Byrne (for Judge Arthur A. Wick)

3055 Cleveland Avenue, Santa Rosa, CA  95403

 

Court Call is now available for all Law and Motion appearances, EXCEPT parties in small claims cases and motions for claims of exemption which are mandatory appearances. ** To set up Court Call- Please call CourtCall directly at (888) 882-6878.

The following Tentative Rulings will become the ruling of the Court unless a party desires to be heard.  If you desire to appear and present oral argument as to any motion, it will be necessary for you to contact Judge Wick’s Judicial Assistant by telephone at (707) 521-6730 by 4:00 p.m., MONDAY, SEPTEMBER 29, 2014.  Any party requesting an appearance must notify all other parties of their intent to appear.

1.  SCV-251208 Mentelos v. Bank of America:

            This is on calendar for the Defendants’ motion for judgment on the pleadings (the Motion). The Defendants contend that the Complaint fails to allege facts to state a cause of action.  The Defendants argue that the Plaintiffs’ action is barred by the Statute of Frauds. (Citing Secrest v. Security Nat. Mortg. Loan Trust 2002–2 (2008) 167 Cal.App.4th 544, 552; and CC § 1624(a)(3).) The Defendants contend that the lack of a written agreement is fatal to the Plaintiffs’ breach of contract claims—and the derivative claims that flow from the alleged breach.  The Defendants request judicial notice of documents related to the subject loan and property; a request which is granted.

The Plaintiffs oppose, arguing that the Defendants are estopped from asserting the statue of frauds defense on account of the Plaintiffs’ reliance on the oral promises of the Defendants. Further, the Plaintiffs allege that they acted on the Defendants’ statements by repairing the property, and submitting over $30,000 in mortgage payments. (Citing Chavez v. Indymac Mortgage Services (2013)219 Cal.App.4th 1052; and West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780.)

“A contract coming within the statute of frauds is invalid unless it is memorialized by a writing subscribed by the party to be charged or by the party's agent.” (Secrest v. Security Nat. Mortg. Loan Trust 2002–2 (2008) 167 Cal.App.4th 544, 552, 84 Cal.Rptr.3d 275 (Secrest ).) An agreement to modify a contract that is subject to the statute of frauds is also subject to the statute of frauds. (Civ.Code, § 1698.) Thus, California courts have held that forbearance agreements altering a mortgage are covered by the statute of frauds. (Secrest, supra, at p. 552, 84 Cal.Rptr.3d 275.)

The complaint does not allege that the modification was ever reduced to writing. “Courts, however, ‘have the power to apply equitable principles to prevent a party from using the statute of frauds where such use would constitute fraud.’ ” (Chavez v. Indymac Mortgage Services (2013) 219 Cal.App.4th 1052, 1057–1058.)  

Here, the Complaint alleges that the Defendants promised a permanent modification if the Plaintiffs performed, i.e. made the trial payments for three months. The Complaint alleges full performance on their part. Moreover, the Complaint alleges that the Plaintiffs’ changed their position in excess of the amount owed under the loan by making significant and costly repairs to the property—repairs that they otherwise would not have made effectively distinguishing Secrest. (See Chavez v. Indymac Mortgage Services (2013) 219 Cal.App.4th 1052, 1061.) Moreover, “[w]hether a party is precluded from using the statute of frauds defense in a given case is generally a question of fact. [Citation.]” (Chavez, supra, 219 Cal.App.4th at 1058.) Further, Plaintiffs contend that they stated fact sufficient to constitute a cause of action for promissory estoppel. There are sufficient allegations to support a cause of action for promissory estoppel. (See Bushell v. JPMorgan Chase Bank, N.A. (2013) 220 Cal.App.4th 915, 922; Wells Fargo Bank, N.A. v. FSI, Financial Solutions, Inc. (2011) 196 Cal.App.4th 1559, 1573.)

Since the Plaintiffs have alleged a breach of contract, the derivative causes of action survive as well.

Accordingly, the Defendants’ motion for judgment on the pleadings is denied.  Plaintiffs shall draft a proposed order consistent with this ruling.

 

2.  SCV-255738 Newman v. Bank of America:

            This is on calendar for an order to show cause re preliminary injunction. On July 9, 2014, this court issued a temporary restraining order and an order to show cause re preliminary injunction. On September 5, 2014, the Defendants filed a notice of removal, indicating that they had removed the instant matter to the United States District Court for the Northern District of California. As a result this court no longer has jurisdiction over the matter. (See 28 USC § 1441; and 28 USC § 1446(d) [“Promptly after the filing of such notice of removal of a civil action the defendant or defendants shall give written notice thereof to all adverse parties and shall file a copy of the notice with the clerk of such State court, which shall effect the removal and the State court shall proceed no further unless and until the case is remanded.”].)

Accordingly, the current motion is dropped from the calendar.

           

3.  MCV-222224 Nellessen v. Hill:

            This is on calendar for Judgment Creditor Robert Nellessen’s (the Creditor) motion to amend the judgment to include Hillary D. Hill in her capacity as the trustee of the Hilary D. Hill Living Trust dated April 9, 1998 (the Trust). The Judgment Creditor contends that Trust is an “alter ego” of the Defendant/Judgment Debtor Hillary Hill (the Debtor). The Debtor opposes, arguing that the instant motion violates the automatic bankruptcy stay an account or her bankruptcy filing (the Debtor field a petition for bankruptcy protection on April 4, 2014). The Debtor contends that the motion is in violation of the stay, and said violation entitles her to attorney fees and sanctions. Further, the Debtor states that the Creditor failed to serve all of the papers associated with the Motion. The Creditor responds, contending that the Debtor, as Trustee of the Trust, did not file for bankruptcy.

Under California law, when the settlor of a trust retains the power to revoke a trust, the trust res remains the settlor's property subject to his creditor's claims. (See Cal. Prob.Code § 15800; § 18200 [property in revocable trust is subject to claims of settlor's creditors during settlor's lifetime]; Empire Props. v. County of Los Angeles (1996) 44 Cal.App.4th 781, 786–87 [transfer of real property to revocable trust does not change ownership for property tax reassessment purposes]; see also In re Irwin (E.D.Cal.2006) 338 B.R. 839, 854–53 [property transferred to revocable trust was property of the settlor's bankruptcy estate].)

The Creditor’s motion is misplaced. As explained above, if the Trust is revocable then the assets of the trust come under the jurisdiction of the bankruptcy court—regardless of whether the Trust is listed on the petition or not.  Further, as explained above, the fact that the assets are held in the Trust (if the Trust is revocable) does not affect the Creditor’s right to make a claim to those assets. That being said, however, the Creditor’s motion may be a violation of either the bankruptcy stay (if the Creditor did not obtain an order lifting the stay) or a violation of the Debtor’s discharge injunction (if the Debtor has in fact been discharged.) The court notes, however, that the Creditor has provided scant evidence with respect to the existence of the Trust or its terms. Further, the Creditor provides little evidence of the status of the bankruptcy case. Indeed, the Creditor argues that the Debtor failed to list the assets of the trust in the petition—but fails to present any evidence (i.e. the petition) to demonstrate the veracity of that claim. In any event, the matter has been stayed, and there is no evidence before the court that stay has been lifted. Moreover, the concept that the Trust is an “alter ego” of the Debtor for purposes of judgment enforcement is an untenable position.

The Creditor has failed to provide any relevant evidence or argument as to why (or even if) the judgment needs to be amended. Accordingly, the Motion is denied in its entirety. The court will decline to make a finding with respect to whether the Motion violates the automatic stay. Nor will the court award the Debtor attorney fees, costs, or punitive damages. The Creditor shall draft an order consistent with this ruling.

 

4.  MSC-183980 Clark v. Christensen:

            The parties are to appear.

 

5.  MSC-184251 Tomlin v. Brown:

            The parties are to appear.

 

6.  SCV-248629 Cameron v. Vintage Greens:

            Cross-Defendant Hard Drywall Inc. moves for an order determining that the settlement by and between the it and Defendant/Cross-Complainant Vintage Greens is in good faith for purposes of CCP § 877 and 877.6. The motion is unopposed.

Accordingly, the motion is granted. (See City of Grand Terrace v. Superior Court (1987) 192 Cal. App. 3d 1251, 1261; Alcal Roofing & Insulation v. Superior Court (1992) 8 Cal. App. 4th 1121, 1127.) The moving party is to draft an order consistent with this ruling.

 

7.  SCV-251562 Doty v. Stoke:

            Defendant DeVilbiss moves for an order determining his settlement with the Plaintiffs was made in good faith for purposes of CCP § 877 and 877.6. The motion is unopposed.

Since the motion is uncontested the settlor’s moving papers need only “set[ ] forth the ground of good faith accompanied by a declaration which sets forth a brief background of the case.” (City of Grand Terrace v. Superior Court (1987) 192 Cal. App. 3d 1251, 1261.) The moving party has met his burden.

Accordingly, the motion is granted. The moving party is to draft an order consistent with this ruling.

 

8.  SCV-255156 Stjern v. Peterson:

            This motion has been withdrawn by the moving party, therefore the hearing on the motion has been dropped from calendar.

           

9.  SPR-86741 Matter of Constance Doolittle Trust:

            The Court approves the petition of Trustee Exchange Bank for instructions and confirms the trustee’s authority to use trust funds to defend against Susan Doolittle’s petition to invalidate the 2005 Trust and to defend against the complaint for financial abuse of an elder.  In so ruling, the Court finds that the trust provision directing the trustee to defend any contest at the expense of the trust is not itself a “no contest” clause. Trustee Exchange Bank shall draft a proposed order consistent with this ruling.

The petition of Susan Doolittle for instructions regarding trustee use of trust assets to defend trust contest is denied.  Trustee Exchange Bank shall draft a proposed order consistent with this ruling.

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