Case Number: GC050360 Hearing Date: July 03, 2014 Dept: A

Wang v Basba

MOTION TO COMPEL FURTHER RESPONSES
MOTION TO QUASH SUBPOENA
DEMURRER
MOTION TO STRIKE

Calendar: 11
Case No: GC050360
Date: 7/3/14

RELIEF REQUESTED:
1. Motion of Plaintiffs, Charles Wang and Anita Wang
Order compelling Rebecca Du Basba to serve further responses to their requests for production.

2. Motions of Defendants, Rebecca Du Basba and Benju Basba
Order quashing subpoena for business records served on Jade Escrow
Demurrer to Fourth Amended Complaint
Strike portions from Fourth Amended Complaint

DISCUSSION:
The Plaintiffs claim that the Defendant, Benju Basba, breached an agreement to repay $1,000,000 under a promissory note. Further, the Plaintiffs claim that Defendant, Rebecca Basba, is liable because she was married to Benju Basba at the time of the loan and that Benju Basba made a fraudulent conveyance to Rebecca Basba to avoid paying the debt.

This hearing concerns the following motions:

1) the Plaintiffs’ motion for an order compelling Defendant, Rebecca Du Basba, to serve further responses to their requests for production;
2) the Defendant’s motion to quash a subpoena for business records on Jade Escrow; and
3) the Defendants’ demurrer to the Fourth Amended Complaint.

1. Plaintiffs’ Motion to Compel Further Responses to Requests for Production
The Plaintiffs request an order compelling Defendant, Rebecca Du Basba, to serve further responses to requests for production 10 and 11. The moving parties seek relief under CCP section 2031.310.

The moving papers do not comply with CCP section 2031.310(b)(1) because the motion does not set forth specific facts showing good cause justifying the discovery sought by the demand. In law and motion practice, factual evidence is supplied to the court by way of declarations. Calcor Space Facility v. Superior Court (1997) 53 Cal. App. 4th 216, 224 (rejecting facts supporting the production of documents that were in a separate statement because the document was not verified and did not constitute evidence). In Calcor, the Court of Appeal issued a writ of mandate issue directing the trial court to vacate its order compelling the defendant to produce records because the plaintiff had failed to provide specific facts showing good cause for their production.
The same problem exists here. The declaration of the moving parties’ attorney, Matthew Pero, lacks any specific facts showing good cause for the inspection of any of the documents sought in requests for production 10 and 11. Mr. Pero states in paragraph 9 that the requests for production relate to the issues in the complaint and that the documents are needed to resolve the purchase of the property. This vague statement could be made in any case and it comply with CCP section 2031.310(b)(1) by providing the specific facts needed to establish good cause for the production of the documents sought in these requests for production.
The Plaintiffs also request that the Court take judicial notice of a declaration by the Defendant, Rebecca Du Basba, that accompanied her opposition to the Plaintiffs’ application for a writ of attachment. There are no specific facts in her declaration regarding the Plaintiffs’ requests for production, e.g., facts demonstrating that there is good cause for the specific facts sought in request for production 10 or 11. The Defendant does not discuss the Plaintiff’s requests for production or offer any specific facts to demonstrate that there is good cause to compel the production of documents sought. This is insufficient.

In the reply, Plaintiffs attempt to distinguish the holding in Calcor Space Facility v. Superior Court (1997) 53 Cal. App. 4th 216, 224, that specific facts must be provided in a declaration to satisfy CCP section 2031.310. The Plaintiffs claim that the ruling in Calcor was based on the facts in a separate statement, which cannot constitute evidence. However, the holding in Calcor is not based solely on the admissibility of the facts. Instead, it is also based on the failure to comply with CCP section 2031.310 by providing specific facts in a declaration that justify the requests for production. As discussed above, the Plaintiffs failed to meet this burden; instead, they attorney offered the statement “The requests for production that are the subject of this motion to compel relate directly to the issues raised in plaintiffs’ complaint in this action.” This statement lacks the specific facts needed to meet the burden imposed by CCP section 2031.310. Also, the declaration of the Defendant, Rebecca Du Basba, fails to meet this burden because it does not provide specific facts regarding the Plaintiff’s requests for production at issue.

Therefore, the Court will deny the Plaintiffs’ motion because there is no declaration that complies with CCP section 2031.310(b)(1). The declarations of the Plaintiffs’ attorney and Rebecca Du Basba do not state specific facts showing good cause to justify the documents sought in requests for production 10 or 11.

2. Defendant’s Motion to Quash
The Defendants request that the Court quash a subpoena for business records that was served on a third party, Jade Escrow. The Defendants argue that this escrow file contains private information and third party information related to the purchase of the home. The home is the property that the Plaintiffs claim was fraudulently transferred to Rebecca Du Basba from Benju Basba.
On June 25, 2014, the Court denied the Defendant’s request to quash a subpoena for her bank records from Evertrust Bank.

CCP section 1987.1 permits the Court to quash a subpoena entirely and to issue a protective order. Under CCP section 2017.010, a party may obtain discovery regarding any matter, not privileged, that is relevant to the subject matter involved in the pending action, if the matter either is itself admissible in evidence or appears reasonably calculated to lead to the discovery of admissible evidence. Discovery may relate to the claim or defense of the party seeking discovery or of any other party to the action.

The Plaintiffs has served a subpoena that includes the following six requests (see requests in Defendant’s separate statement):

1) the escrow file of Jade Escrow for the sale and purchase of the real property at 711 Camino Grove Avenue, Arcadia, involving buyers Benju Basba and Rebecca Du Basba;
2) all written communications between Jade Escrow and the Buyers and Sellers regarding the escrow;
3) all written escrow instructions and amended escrow instructions;
4) all purchase and sale documents relating to the property and the escrow;
5) all e-mails, written letters, and notes of conversations of communications between the Sellers, Buyers, Jade Escrow, Inc., the title company, and the lenders; and
6) all settlement statements regarding the escrow;

This case involves the Plaintiff’s claim that Benju Basba failed to repay a loan and that he made a fraudulent conveyance of the property at 711 Camino Grove Avenue, Arcadia to Rebecca Du Basba in March of 2011. The Plaintiffs’ subpoena seeks to obtain documents regarding the sale of the property to Benju Basba and Rebecca Du Basba.
These documents include information protected by a right to privacy regarding confidential financial information. Fortunato v. Superior Court (2003) 114 Cal. App. 4th 475, 479 (finding that the right to privacy encompasses certain confidential financial information in bank records). Where discovery involves matters encompassed by the right to privacy, courts recognize that judicial discovery orders inevitably involve state-compelled disclosure subject to constitutional constraints. Mendez v. Superior Court (1988) 206 Cal. App. 3d 557, 566-567. The proponent of discovery into constitutionally protected material has the burden of making a threshold showing that the evidence sought is “directly relevant” to the claim or defense. Britt v. Superior Court (1978) 20 Cal.3d. 844, 859-862. Even when discovery of private information is found directly relevant to the issues of ongoing litigation, it will not be automatically allowed; instead, the Court must carefully balance the compelling public need for discovery against the fundamental right of privacy. Mendez, 206 Cal. App. 3d 557, 566-567.
The Plaintiffs meet their burden because the subpoena seeks documents that are directly relevant to the Plaintiff’s claim that there was a fraudulent conveyance of the property at 711 Camino Grove Avenue. The subpoena seeks the documents concerning the manner in which the Defendants acquired title to the property at issue, e.g., the amounts paid, the manner in which title was taken, or instructions regarding title. These documents are directly relevant to the Plaintiffs’ claim that property was acquired by the Defendants and that Benju Basbu then fraudulently transferred his interest to Rebecca Du Basba.
Further, a protective order regarding the use of these documents in this proceeding will ensure a balance between the need for discovery of the issues in this case and the right to privacy. On pages 7 to 8 of the opposition, the Plaintiff has stipulated to sign a protective order regarding these documents and the disclosure of any confidential financial information. The Plaintiff offers a proposed protective order in exhibit 3 to the opposition.

Therefore, the Court will deny the Defendant’s motion to quash the subpoena for the escrow records held by Jade Escrow. Further, the Court will order the parties to submit a proposed protective order regarding the use of these documents in this case.

3. Defendant’s Demurrer and Motion to Strike
The Defendants have made a demurrer and motion to strike directed at the Plaintiff’s Fourth Amended Complaint. However, a review of the Court file reveals that the Plaintiff has not filed a Fourth Amended Complaint.
On June 25, 2014, the Court granted the Plaintiff’s motion for leave to amend in which it granted leave to file a Fourth Amended Complaint. However, a review of the Court file reveals that the Plaintiff did not file any pleading. Accordingly, there is no operative Fourth Amended Complaint in the Court file.
The Defendants filed their demurrer and motion to strike on May 14, 2014. It appears that the Defendants are attacking a copy of the Fourth Amended Complaint that they received when the Plaintiff sought leave to amend. However, since the Plaintiffs have not submitted a Fourth Amended Complaint to the Court that can be date-stamped and properly filed in the Court’s file, the hearing will be continued.

Therefore, the Court will continue the hearing on the demurrer and motion to strike and order the Plaintiff to file a Fourth Amended Complaint with the Court forthwith.

RULING:
1. DENY Plaintiffs’ motion for an order compelling further responses.
2. DENY Defendant’s motion to quash the subpoena.
3. CONTINUE hearing on Defendants’ demurrer and motion to strike and order the Plaintiff to file a Fourth Amended Complaint forthwith.