Department 6 SB-Anacapa
1100 Anacapa Street P.O. Box 21107 Santa Barbara, CA 93121-1107
CIVIL LAW & MOTION
Robert Morris vs Mansour Rofeh
|Hearing Date:||Wed Jun 26, 2013 9:30|
Nature of Proceedings: Writ of PossessionTentative Ruling: As set forth herein, the application of plaintiff Robert Morris for issuance of a writ of possession to take possession of three race cars described in plaintiff’s UCC-1 Financing Statement, set forth below, in the possession of defendant Mansour Rofeh is granted. The requirement of plaintiff’s undertaking is waived. The court fixes the amount of defendant’s undertaking sufficient to satisfy the requirements of subdivision (b) of Code of Civil Procedure section 515.020 in the amount of $500,000. The court further orders Rofeh to transfer possession of the three race cars to Morris as provided by Code of Civil Procedure section 512.070. Background: This is an unopposed application for writ of possession. On April 3, 2000, in Santa Barbara, California, defendant Mansour Rofeh signed and delivered a promissory note to plaintiff Robert M. Morris in the original principal amount of $600,000.00. (Morris decl., ¶ 3; Verified Complaint, exhibit A.) The note was secured by three vintage race cars and additional security. (Ibid.) On February 3, 2006, the note was modified in writing to reduce the amount of the note from $600,000.00 to $450,000.00. (Ibid.) The security in the race cars was perfected by the filing of a UCC Financing Statement with the California Secretary of State on May 16, 2012. (Morris decl., ¶ 3; Verified Complaint, exhibit B.) When the note was modified in 2006, the payments on the note were reduced from $4,000 per month to $2,500 per month. (Morris decl., ¶ 12; Verified Complaint, exhibit A.) At the same time, the additional security—assets of Rofeh’s business, Amphora Antiques—was removed as collateral for the note. (Ibid.) The three race cars are described as: (1) 1948 Indianapolis front wheel drive #7 race car, blue in color, 270 cubic inch Offenhauser 4 cylinder, overhead cam power plant, red wire wheels, as shown at Pebble Beach, stored since 1950, with extensive parts, patterns and blueprints by Leo Goossen and extra tires; (2) same car as in (1) in all details, except body is bare aluminum (unpainted), with extensive parts, patterns and blueprints by Leo Goossen; and, (3) 1935 Miller Schofield powered, Clyde Adams chassis big car, maroon and cream paint, restored to Concours condition, gold leaf #3 on hood, tail and grill. (Verified Complaint, exhibit B.) The first two cars are referred to as the “front wheel drive race cars”; the third car is referred to as the “Sta-Lube race car.” (Morris decl., ¶ 5.) The first front wheel drive race car is currently valued at $250,000.00, the second front wheel drive race car is valued at $150,000.00, and the Sta-Lube race car is valued at $100,000.00. (Schneider decl., p. 5.) Rofeh made payments required by the original and modified promissory note through October 2011. (Morris decl., ¶ 15.) All payments ceased after October 2011, when Rofeh failed to make the required payment for November 2011. (Ibid.) The note became in default as to the remaining principal of $450,000.00 on November 30, 2011. (Ibid.) Interest has accrued at the legal rate of 10 percent per annum from the date of default, November 30, 2011. (Morris decl., ¶ 15.) Morris filed his Verified Complaint for breach of contract and replevin on March 21, 2013, concurrently with this application for writ of possession. The summons, complaint, application for writ of possession and notice of hearing were served on Rofeh on March 24, 2013, by substituted service. This application was originally set for hearing on May 16, 2013. However, the hearing date was changed by the court to May 15. By the time of the May 15 hearing, the court’s file did not include any proof of service on the defendant of the date change. In the absence of such proof, the court continued the hearing to June 5 for plaintiff to provide notice and proof of service of that notice. Plaintiff has now provided proof of service of notice of this application. No answer to the complaint or opposition to this application has been filed with the court. Analysis: A writ of possession may be issued upon noticed motion. (Code Civ. Proc., § 512.020, subd. (a).) “If the defendant desires to oppose the issuance of the writ, he shall file with the court either an affidavit providing evidence sufficient to defeat the plaintiff’s right to issuance of the writ or an undertaking to stay the delivery of the property in accordance with Section 515.020.” (Code Civ. Proc., § 512.040, subd. (c).) The time for service of moving, opposition, and reply papers are the same as for an ordinary noticed motion. (Code Civ. Proc., §§ 1005, subd. (b), 516.010; Rules of Court, rule 3.1300(a).) No opposition, affidavit providing evidence, or undertaking has been filed with the court. The court determines that Rofeh does not desire to oppose the issuance of the writ. “The application shall be executed under oath and shall include all of the following: “(1) A showing of the basis of the plaintiff’s claim and that the plaintiff is entitled to possession of the property claimed. If the basis of the plaintiff’s claim is a written instrument, a copy of the instrument shall be attached. “(2) A showing that the property is wrongfully detained by the defendant, of the manner in which the defendant came into possession of the property, and, according to the best knowledge, information, and belief of the plaintiff, of the reason for the detention. “(3) A particular description of the property and a statement of its value. “(4) A statement, according to the best knowledge, information, and belief of the plaintiff, of the location of the property and, if the property, or some part of it, is within a private place which may have to be entered to take possession, a showing that there is probable cause to believe that such property is located there. “(5) A statement that the property has not been taken for a tax, assessment, or fine, pursuant to a statute; or seized under an execution against the property of the plaintiff; or, if so seized, that it is by statute exempt from such seizure.” (Code Civ. Proc., § 512.010, subd. (b).) The application filed by Morris is on the required Judicial Council form and contains the information required by Code of Civil Procedure section 512.010, subd. (b). “The writ will be issued if the court finds that the plaintiff’s claim is probably valid and the other requirements for issuing the writ are established. The hearing is not for the purpose of determining whether the claim is actually valid. The determination of the actual validity of the claim will be made in subsequent proceedings in the action and will not be affected by the decision at the hearing on the application for the writ.” (Code Civ. Proc., § 512.040, subd. (b).) “A claim has ‘probable validity’ where it is more likely than not that the plaintiff will obtain a judgment against the defendant on that claim.” (Code Civ. Proc., § 511.090.) Morris has provided evidence of a promissory note by Rofeh that is secured by the race cars and is in default in the principal amount of $450,000. Morris has perfected his security interest. “After default, a secured party may … : [¶] (1) Take possession of the collateral.” (U. Com. Code, § 9609, subd. (a)(1).) “A secured party may proceed under subdivision (a) …: [¶] (1) Pursuant to judicial process.” (U. Com. Code, § 9609, subd. (b)(1).) Morris has provided sufficient evidence of his right to possession of the race cars which are the collateral for the note in default. Rofeh has not appeared in this action, has not opposed this motion, and has not otherwise presented evidence for the court for consideration in this motion. Based upon the evidence presented, the court finds that plaintiff Morris has a probable validity of obtaining a judgment in his favor. “At the hearing, a writ of possession shall issue if …: [¶] … [¶] (2) The undertaking requirements of Section 515.010 are satisfied.” (Code Civ. Proc., § 512.060, subd. (a)(2).) “Except as provided in subdivision (b), the court shall not issue … a writ of possession until the plaintiff has filed an undertaking with the court. … The undertaking shall be in an amount not less than twice the value of the defendant’s interest in the property or in a greater amount. The value of the defendant’s interest in the property is determined by the market value of the property less the amount due and owing on any conditional sales contract or security agreement and all liens and encumbrances on the property, and any other factors necessary to determine the defendant’s interest in the property. (Code Civ. Proc., § 515.010, subd. (a).) Morris has presented evidence that the market value of the race cars is $500,000 in the aggregate. Morris has also presented evidence of the principal amount due on the note of $450,000, together with interest at the legal rate from November 30, 2011. Morris calculates the interest through April 1, 2013, at $63,750. (Morris decl., ¶ 17.) The details of this calculation are not provided. The court calculates interest in the smaller amount of $60,041.38, which does not affect the determination of the Rofeh’s interest in the collateral. (Note: Interest to November 30, 2012, is one year and therefore $45,000. The daily interest is $123.29 ($450,000 x 0.10/365). There are 122 days from November 30, 2012, to April 1, 2013 (31+31+28+31+1). The total interest from November 30, 2012, to April 1, 2013 is $15,041.38 ($123.29 x 122). Thus, the total interest is $60,041.38 ($45,000.00 + $15,041.38).) The total amount owing on the note including both principal and interest to April 1, 2013, is $510,041.38. (Interest continues to accrue, increasing this amount.) The amount owing on the note with accrued interest is greater than the market value of the property. Rofeh has presented no evidence to the contrary. The court therefore finds that Rofeh has no interest in the property. “If the court finds that the defendant has no interest in the property, the court shall waive the requirement of the plaintiff’s undertaking and shall include in the order for issuance of the writ the amount of the defendant’s undertaking sufficient to satisfy the requirements of subdivision (b) of Section 515.020.” (Code Civ. Proc., § 515.010, subd. (b).) Based on the court’s finding that the defendant has no interest in the collateral, the court waives the requirement of the plaintiff’s undertaking. “The [defendant’s undertaking to prevent the plaintiff from taking possession of the property pursuant to a writ of possession] shall state that, if the plaintiff recovers judgment on the action, the defendant shall pay all costs awarded to the plaintiff and all damages that the plaintiff may sustain by reason of the loss of possession of the property. The damages recoverable by the plaintiff pursuant to this section shall include all damages proximately caused by the plaintiff’s failure to gain or retain possession.” (Code Civ. Proc., § 515.020, subd. (b).) Morris has provided no evidence of the amount of damages that would be proximately caused by plaintiff’s failure to gain possession of the race cars other than the value of the race cars themselves; Morris requests that Rofeh’s undertaking be set at the value of the race cars, $500,000. (Memorandum in Support, at pp. 4-5.) Rofeh has presented no evidence at all. The court fixes the amount of defendant’s undertaking sufficient to satisfy the requirements of subdivision (b) of section 515.020 in the amount of $500,000. The court will therefore grant Morris’s application for issuance of the writ of possession as set forth herein. “No writ directing the levying officer to enter a private place to take possession of any property shall be issued unless the plaintiff has established that there is probable cause to believe that the property is located there.” (Code Civ. Proc., § 512.060, subd. (b).) Morris was told by Rofeh that the race cars, which previously had been in a warehouse, were moved to a secret location. (Morris decl., ¶ 13.) Morris has not established that there is probable cause to believe that the property is at any specific location at this time. “If a writ of possession is issued, the court may also issue an order directing the defendant to transfer possession of the property to the plaintiff. Such order shall contain a notice to the defendant that failure to turn over possession of such property to plaintiff may subject the defendant to being held in contempt of court.” (Code Civ. Proc., § 512.070.) Morris has requested an order directing Rofeh to transfer possession of the race cars to Morris. The court will issue the order as requested.