Case Name: Naegele v. DeVries

Case No.: 1-13-CV-242216

Defendant Donald DeVries (“Defendant”) moves for judgment on the pleadings against plaintiff Charles Joseph Naegele (“Plaintiff”).

This is an action for conversion and money had and received.  On August 24, 2012, Defendant instituted an ancillary action in San Mateo County Superior Court (CIV 516299) entitled Application for Issuance of Order of Sale of Dwelling [Code Civ. Proc. Section 704.750].  (Second Amended Complaint (“SAC”), ¶ 2.)  This statutorily limited proceeding was to secure the order identified in the title of the document.  (Id.)  On November 7, 2012, Defendant secured an order to sell the home located at 202 Santa Monica Ave., Menlo Park.  (Id.)

In February 2013, Plaintiff was the owner of the Menlo Park home.  (SAC, ¶ 3.)  Plaintiff entered into an agreement to sell the property to Timothy A. Stankey and Kaylin M. Stankey, and an escrow account was opened at First American Title Company under escrow number 4102-4266465.  (Id., ¶ 4.)  The sale was scheduled for completion and escrow was to close on February 19, 2013.  (Id., ¶ 4 and Exhibit A.)

On February 4, 2013, Defendant placed a demand in the aforementioned escrow account requesting payment to him of $179,157.81.  (SAC, ¶ 4 and Exhibit B.)  This demand was predicated on an April 6, 2012 Amended Judgment in Defendant’s favor and against Plaintiff in the action entitled DeVries v. Naegele, Santa Clara Superior Court, Case No. 1-09-CV-149170.  (Id. and Exhibit C.)  At the time of the filing of the SAC, the Amended Judgment was pending on appeal.  (Id.)

On April 23, 2012, the Court (Hon. Overton) issued an Order Re: Undertaking on Appeal in the Santa Clara County action.  (SAC, ¶ 5 and Exhibit B.)  The order provided for an undertaking in the amount of $224,692.51 under Code of Civil Procedure section 917 et seq. if provided by an admitted surety.  (Id.)  On February 11, 2013, American Contractors Indemnity Company, an admitted surety, filed an undertaking in the amount of $224, 692.51 on Plaintiff’s behalf to stay enforcement of the judgment.  (SAC, ¶ 5 and Exhibit E.)  On February 17, 2013, Defendant was advised of the posted undertaking via fax.  (Id., ¶ 6 and Exhibit E.)  The next day, Defendant acknowledged receipt of the fax.  (Id.)  Defendant did nothing to remove or withdraw his demand from escrow account 4102-4262465, and on February 19, 2013, he was paid the sum of his demand.  (Id., ¶ 7.)  On that day, he allegedly converted to his own use the sum of $179,157.81 from the escrow account.  (Id.)  Defendant refuses to return the funds, and is now in possession of Plaintiff’s property.

On August 16, 2013, Plaintiff filed the SAC asserting claims for (1) conversion and (2) common count- money had and received.  On July 14, 2014, Defendant filed the instant motion for judgment on the pleadings.  (Code Civ. Proc., § 438.)

Defendants’ request for judicial notice is GRANTED.  (Evid. Code, § 452, subd. (d).)

Plaintiffs’ request for judicial notice is GRANTED.  (Evid. Code, § 452, subd. (d).)

Defendants’ motion for judgment on the pleadings is DENIED.  Defendant asserts that his motion should be granted because Plaintiff cannot obtain the evidence necessary to support his claims given the recent affirmation of the underlying judgment (i.e., Amended Judgment issues in Case No. 1-09-CV-149170).  While Defendant is correct that his general entitlement to money from Plaintiff was affirmed, the conversion claim in the SAC involves the state of his rights as they existed on February 19, 2013, when the conversion is alleged to have taken place.  At that time, Defendant’s right to possess the funds obtained from the escrow account (i.e., collect on the Amended Judgment) was suspect given the posting of an undertaking prior to the sale of the property, which effectively stayed the judgment.  (Code Civ. Proc., § 917.1.)