18-CIV-06581 PHUONG NGUYEN, ET AL. VS. WELLS FARGO, N.A., ET AL.

PHUONG NGUYEN WELLS FARGO, N.A.
MATTHEW MELLEN

CROSS-COMPLAINANT’S APPLICATION FOR WRIT OF POSSESSION TENTATIVE RULING:

Cross-complainant’s Application for Writ of Possession is GRANTED.

A. AJE Establishes Probable Validity of Its Claim.

Cross-defendants defaulted on the two loans, and Wells Fargo conducted a foreclosure sale on the UCC-1 Financing Statements securing the loans. Cross-complaint AJE was the purchaser at the sale. As the winning buyer, AJE is the owner of the personal property listed in the UCC-1 Statements. After the sale, Cross-defendants remained in possession of the property at the dental office, despite AJE’s having purchased the personal property at the sale. AJE estimates that the property is valued at $161,000. Cross-defendants’ Opposition does not contest the estimate.

B. Opposing Arguments Lack Merit.

NGUYEN contends that the application’s description of property is insufficiently vague: “All of the personal property of PHUONG T. NGUYEN and Shawn C. PAXSON, including all inventory, chattel paper, accounts, equipment and general intangibles; all accessions, additions, replacements; and substitutions relating to any of the foregoing . . . .” Crossdefendants’ argument is unpersuasive because the UCC-1 Statements, prepared by NGUYEN and PAXSON, describe the collateral in nearly identical terms. (See Crosscomplaint, Exhibits 2 & 5.) The description of property is sufficient.

As to the merits of AJE’s claim, Cross-defendants’ opposing arguments lack merit. NGUYEN testifies that she had leases for equipment from US Bank, AEL Financial, and Dell Computers and that she reached a settlement agreement, paying off the liens with US Bank and AEL Financial. (Decl. of NGUYEN ¶ 7.) The status of NGUYEN’s leases is irrelevant because the property was encumbered by the liens created by the UCC-1 Financing Statements, and Wells Fargo foreclosed on the liens.

NGUYEN testifies that the payoff quotes from Wells Fargo led her to believe that she had 30 days to pay off the loan. Nothing in the payoff letters suggests that a foreclosure sale would not occur for 30 days. NGUYEN also states that she did not receive Notice of Trustee’s Sale with the November 8, 2018 date of sale. The Court takes judicial notice of the evidence filed in support of AJE’s motion for summary judgment in the related unlawful detainer action (18 CLJ 01216), which demonstrates:

1. On September 11, 2018, Wells Fargo recorded a Notice of Sale which Defendant NGUYEN received. (NGUYEN Depo. at 104 & Ex. 16 thereto).) The Notice indicated that the sale was October 10, 2018. [U/D summary judgment motion, RJN Exhibit 5.)

2. NGUYEN transferred the Property to PHUONG T. NGUYEN, D.D.S., Inc., which then filed for bankruptcy. [U/D motion for summary judgment, Exh. 6 to RJN; Exh. 12 to Seigel Dec. (Bankruptcy Petition)] Because of the bankruptcy, the sale was continued to November 9, 2018; on October 10, 2018, the auctioneer announced the new sale date of November 9, 2018 [U/D summary judgment Decl. of Francesconi, Exhibit 3.) Cross-defendants had full notice of the sale.

NGUYEN argues that the “Property” was appraised at about $1.88 million at the time of the foreclosure, but was sold for $454,600.00. (Decl. of NGUYEN para. 17-21.) The argument is unpersuasive for this motion, because the appraisal to which NGUYEN refers was for the real property, not the personal property that is the subject of this application for writ of possession. (See Decl. of NGUYEN para. 17, Exhibit C.)

NGUYEN also is “informed and believes” that the winning bid was the product of bid rigging and fraud. She offers no evidence to support the contention. Finally, NGUYEN’s statement at the sale that “there would be a lawsuit over the sale” does not constitute notice to AJE sufficient to negate AJE’s bona fide purchase status.

C. Undertaking.

A writ of possession may not issue without the requesting party posting an undertaking in defendant’s favor, unless waived by the court upon finding that defendant has no interest in the property (Code of Civ. Proc. § 515.010(a).) The amount of the undertaking must at least equal twice the value of defendant’s interest in the property. (Id.) AJE contends that the value of the property is $161,000. Cross-defendants do not object to it or contest it. The mandatory undertaking for writ of possession is $322,000.00.

D. Ruling.

The application for writ of possession is granted. Before issuance of the writ, Crosscomplainant A.J.E. Investment Group, LLC shall file with the Court an undertaking of $322,000.00, in favor of Cross-defendants PHUONG NGUYEN and PHUONG T. NGUYEN, D.D.S., Inc.

If the tentative ruling is uncontested, it shall become the order of the Court. Thereafter, counsel for Cross-complainant AJE Investment Group, LLC shall prepare a written order consistent with the Court’s ruling for the Court’s signature, pursuant to California Rules of Court, Rule 3.1312, and provide written notice of the ruling to all parties who have appeared in the action, as required by law and the California Rules of Court.