16-UDL-00076 1589 HIGGINS CANYON, LLC VS. OSCAR BRAUN, ET AL.

1589 HIGGINS CANYON, LLC OSCAR BRAUN
LEWIS J. SOFFER JULIA M. WEI

MOTION FOR SUMMARY JUDGMENT TENTATIVE RULING:

The Motion of Plaintiff 1589 Higgins Canyon LLC1 (“Plaintiff”) for Summary Judgment to Claim of Possession by Defendant Jeanette Braun (“Defendant”) is GRANTED, for the reasons that follow:

1. PLAINTIFF HAS MET ITS BURDEN OF PRODUCING EVIDENCE TO ESTABLISH ALL THE ELEMENTS OF THE UNLAWFUL DETAINER ACTION.

A party moving for summary judgment must produce sufficient evidence to establish a prima facie case. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849.) The elements to establish the right to possession are: (1) that the property was sold in conformity with Civil Code § 2924 and perfected with a record deed, (2) that the requisite Notice to Quit was served on the occupants and (3) the continued occupancy after the expiration of the notice. (CCP § 1161a(b)(3); Vella v. Hudgens (1977) 20 Cal.3d 251, 255 (a purchaser at a foreclosure sale “need only prove a sale in compliance with the statute and deed of trust, followed by a purchase at sale…”).)

Capital One has presented evidence to establish each of the elements here. Capital One demonstrated that it properly obtained title to the property through a foreclosure sale. (See Plaintiff’s Request for Judicial Notice, Exhs. A, G.) Capital One also showed that it served a 3day/90-day Notice to Quit. (See Proof of Service from registered process server attached to Verified Complaint.) Lastly, the evidence presented shows that Defendant continues to occupy the property after expiration of the Notice to Quit. (See Barasch Decl., Exh. A.)

2. DEFENDANT FAILS TO RAISE A TRIABLE ISSUE OF MATERIAL FACT AS TO ANY OF THE ELEMENTS OF THE UNLAWFUL DETAINER CLAIM OR AN AFFIRMATIVE DEFENSE.

1 1589 Higgins Canyon LLC substituted in as plaintiff as successor-in-interest to Capital One, N.A., by Order dated September 24, 2018, after this motion was filed by Capital One. Thus, for consistency purposes, the Court still refers to Capital One as the plaintiff for purposes of this motion, even though 1589 Higgins Canyon LLC is now the plaintiff.

Since Plaintiff has met its burden, the burden then shifts to Defendant to raise a triable issue of material fact as to one of the elements of this unlawful detainer claim or an affirmative defense. (See C.C.P. sec. 437c(p)(1).)

a. RES JUDICATA DOES NOT BAR THIS MOTION.

Defendant asserts that res judicata bars this motion in light of the Appellate Department’s determination reversing the granting of the prior summary judgment motion as to Defendant Half Moon Bay Coastside Foundation. However, the prior proceeding did not result in a final judgment on the merits, which is one of the elements for res judicata to apply. (See Boeken v. Philip Morris USA, Inc. (2010) 48 Cal.4th 788, 797.)

b. DEFENDANT FAILS TO RAISE A TRIABLE ISSUE OF MATERIAL FACT AS TO THE FIRST ELEMENT.

In opposition, Defendant fails to raise a triable issue of material fact as to the first element, i.e. that the property was sold in conformity with Civil Code section 2924 and perfected with a record deed.

Defendant argues that she was entitled to a special notice under Civil Code section 2924.8 upon the posting of the notice of sale for the property, and denies she was given such a notice. Therefore, she argues that Plaintiff’s failure to comply with section 2924.8 voids the sale.

If a trustee’s deed contains a recital that all default and sale notices have been given, the notice requirements are statutorily presumed to have been satisfied, which presumption is conclusive as to a bona fide purchaser. (Civil Code § 2924(c).) In an unlawful detainer action, the plaintiff need only prove a sale in compliance with the statute and deed of trust, followed by purchase at such sale, and the defendant may raise objections only on that phase of the issue of title. (Cheney v. Trauzettel (1937) 9 Cal.2d 158, 160.) “Matters affecting the validity of the trust deed or primary obligation itself, or other basic defects in the plaintiff’s title, are neither properly raised in this summary proceeding for possession, nor are they concluded by the judgment.” (Ibid.)

Hence, Defendant’s argument regarding the notice required under Civil Code section 2924.8 is not properly raised in this unlawful detainer, as it is not raising an issue regarding sale of the property in compliance with the statute and deed of trust.

c. DEFENDANT FAILS TO RAISE A TRIABLE ISSUE OF MATERIAL FACT AS TO THE SECOND ELEMENT.

Defendant also attempts to raise a triable issue of material fact regarding the 3-day/90-day Notice to Quit upon which this Complaint is based.

First, Defendant claims that another 3-day/90-day Notice to Quit (“second notice”) was served by Plaintiff on June 29, 2018, and therefore Defendant’s possession has been extended. Defendant claims that this second notice may not be unilaterally withdrawn, citing to Devonshire v. Langstaff (1935) 10 Cal.App.2d 369. She contends that a triable issue of fact therefore exists regarding withdrawal of this second notice.

Devonshire, supra, is distinguishable from this action on the basis that it involved an attempt by a landlord to rescind service of a thirty-day notice of termination of a lease, under a speciallycrafted contractual termination provision, upon which notice the Devonshire court assumed the lessees had relied by preparing to comply (Id. at p. 373); and on the basis that the authorities cited by the Devonshire court were secondary sources and one Federal District Court case, all discussing law of other jurisdictions as applied to notices given by parties to a tenancy, and requiring that, “When a valid notice to quit is given by the landlord or tenant the party to whom it is given is entitled to count upon it, and it cannot be withdrawn without the consent of both parties.” (Id., at p. 374.) In contrast, the notices given in the case at bench were post-trustee’s sale notices to quit pursuant to Code of Civil Procedure section 1161a, subd. (b)(3), neither Plaintiff nor any of Plaintiff’s predecessors was ever the landlord under any lease, and the notices were not given pursuant to a contractual provision in a lease governing termination of the lease. Devonshire is therefore not applicable. The Court finds that Defendant fails to establish that the first notice was waived.

Second, Defendant claims there is a triable issue of material fact as to whether the first Notice to Quit was properly served on her, citing to C.C.P. section 1162. The proof of service for the notice shows it was served by posting and mailing at “Home,” which apparently means the house occupied by Oscar and Andrea Braun. However, Defendant argues there is no indication of service upon her at her trailer a half mile away from the house.

Defendant acknowledges though, that she was not named as a defendant in the action, which indicates that Plaintiff was unaware of her existence until Defendant filed her prejudgment claim of right to possession. (See Defendant’s Amended Opposition, p.12:10-12.) The 3-day/90-day Notice to Quit upon which this Complaint is based, was addressed to Oscar and Andrea Braun and all other occupants in possession. Subsequently, Defendant filed a prejudgment claim of right to possession and answer, and was added as a defendant to this action. Therefore, it is unclear how Defendant contends Plaintiff should have served Defendant with the Notice to Quit when Plaintiff was unaware that Defendant resided at the property. Moreover, Defendant has not presented any evidence to show that Plaintiff knew Defendant resided at the property such that Plaintiff should have served Defendant with the Notice to Quit.

Accordingly, Defendant fails to raise a triable issue of material fact regarding the 3-day/90-day Notice to Quit.

d. PLAINTIFF FAILS TO RAISE A TRIABLE ISSUE OF MATERIAL FACT AS TO ANY AFFIRMATIVE DEFENSE.
Defendant’s Answer asserts two affirmative defenses. Defendant’s first affirmative defense is that Plaintiff fails to state a cause of action against her because the 3-day/90-day Notice to Quit was prematurely served in that Defendant had a fixed term lease and Plaintiff did not have a buyer ready to move in as their primary residence. The second affirmative defense is that Defendant claims a right to possession because Plaintiff’s predecessors-in-interest accepted the deed of trust with actual or constructive knowledge that her lease existed, such that Plaintiff took title subject to her lease and cannot evict her from the property.

Both of these affirmative defenses presume that Defendant has an enforceable sublease. To that end, Plaintiff argues that Defendant’s sublease is unenforceable under the Statute of Frauds. (See Civil Code sec. 1624(a).) Civil Code section 1624(a) states, in relevant part, that the following contracts are invalid, unless they, or some note or memorandum thereof, are in writing and subscribed by the party to be charged or by the party’s agent:

(1) An agreement that by its terms is not to be performed within a year from the making thereof. …

(3) An agreement for the leasing for a longer period than one year, or for the sale of real property, or of an interest therein; such an agreement, if made by an agent of the party sought to be charged, is invalid, unless the authority of the agent is in writing, subscribed by the party sought to be charged. …

(Civil Code sec. 1624(a)(1), (3).)

It is undisputed that Defendant’s purported sublease to reside on the property was an oral, not written, agreement with Defendant Half Moon Bay Coastside Foundation (“Foundation”). However, the parties dispute the term and duration of the lease. Plaintiff presents evidence to support that Defendant’s purported oral sublease was for 50 years, which is how long the Foundation’s lease was with Defendants Oscar Braun and Andrea Braun. (See Barasch Decl., Exh. A, Jeanette’s Depo. 15:8-13; 17:7-11; 18:10-13; 21:6-8; 22:10-18; 26:22-25; 27:3-14; 40:841:13.) A 50-year oral lease is unenforceable under section 1624(a)(3).

In opposition to this motion though, Defendant contends that her oral sublease was not for 50 years, but instead for her lifetime. (See Defendant’s Decl., 14:18-15:11.) Defendant argues that she could have died within a year, and therefore the sublease is not unenforceable under the Statute of Frauds. Defendant relies on Fisher v. Parsons (1963) 213 Cal.App.2d 829, 837 to support that an indefinite period that could expire within a year is outside the Statute of Frauds.

However, even if Defendant’s sublease was for a lifetime instead of 50 years, it is also unenforceable under the Statute of Frauds. In Fisher, supra, the plaintiff lessor sued the defendant lessee for breach of an oral lease agreement under which defendant promised to rent office space in plaintiff’s building as long as the defendant remained in business and required office space. (Id. at 832-833.) The Fisher court held that the lease was not subject to the statute of frauds concerning agreements that cannot be performed within one year generally or concerning agreements to lease real property for a period of more than one year. The Fisher court relied on former Civil Code section 1624(1) and (4), which is now Civil Code section 1624(a)(1) and (a)(3), respectively. The Fisher court rejected the attempt to differentiate between these two sections, and found that there was nothing in the terms of the contract that prevented it from being performed within a year from the date of the agreement. (Id. at 837-838.)

However, Bed, Bath & Beyond of La Jolla, Inc. v. La Jolla Village Square Venture Partners (1997) 52 Cal.App.4th 867, 877, held that an agreement to lease real property for a term exceeding one year is subject to the Statue of Frauds in Civil Code section 1624(a)(3). An oral agreement to lease real property for a term exceeding one year is unenforceable under the statute of frauds regardless whether such agreement provides that it may be canceled or terminated within one year of the date of its making and prior to commencement of the lease term. In Bed, Bath & Beyond, the plaintiff negotiated a lease of retail space with a shopping center owner. (Id. at 871.) The plaintiff signed a written lease agreement, but it was never signed by the owner. (Ibid.) Instead, the owner leased the space for a higher rent to another retail business. (Ibid.) The plaintiff brought an action for specific performance, breach of contract and other claims against the owner. (Ibid.)

On the owner’s motion for summary adjudication, the trial court granted the owner’s motion. The Statute of Frauds, as set forth in Civil Code sections 1091 and 1624 and Code of Civil Procedure section 1971, require that the lease alleged by plaintiff be in writing. (Id. at 873.) The plaintiff argued that the lease was not subject to the Statute of Frauds because it possibly could have been performed within one year from the date of its making. (Id. at 875.) One provision provided that the tenant could terminate the lease before the rental term commenced if the landlord failed to begin certain preparatory work on the leased premises by June 1, 1993, or substantially complete that work by December 31, 1993. (Ibid.) A second provision gave the owner the right to terminate the lease before commencement of the rental term if the owner was unable to obtain various governmental permits and approvals required for construction. (Ibid.)

The Court of Appeal agreed that the Statute of Frauds rendered the lease agreement unenforceable. (Id. at 874.) In doing so, the Court of Appeal disagreed with Fisher because it found that Fisher interpreted subdivisions (a) [agreements that cannot be performed within a year from the making thererof] and (d) [agreements to lease real property for a period of more than one year] as expressing the same thought. (Id. at 876.) The Court of Appeal instead interpreted subdivision (d), as a more specific provision than subdivision (a). The focus of subdivision (d) was not the overall agreement to lease, which may be terminable within one year of its making and prior to commencement of the actual lease term, but rather on the duration or term of the lease. (Ibid.) The Court of Appeal held that under rules of statutory construction, statutes relating to the same subject matter must be read together and harmonized if possible. (Id. at 876.) When Civil Code section 1624(d) is read in conjunction with Civil Code section 1091 and Code of Civil Procedure section 1971, “it is clear that the Legislature intended that an agreement to lease real property for a term exceeding one year cannot be enforced by a lessee unless it is in writing and signed by the lessor.” (Ibid.) Civil Code section 1091 provides that an estate in real property, other than an estate at will or for a term not exceeding one year, can be transferred only by operation of law, or by an instrument in writing, subscribed by the party disposing of the same, or by his agent thereunto authorized by writing. (Civil Code sec. 1091.) Similarly, C.C.P. section 1971 provides, in part, that “[n]o estate or interest in real property, other than for leases for a term not exceeding one year, … can be created, granted, assigned, surrendered, or declared, otherwise than by operation of law, or a conveyance or other instrument in writing….”

After reviewing Fisher and Bed, Bath & Beyond, the Court finds the interpretation of the Statute of Frauds in Bed, Bath & Beyond to be more persuasive because it is interpreted consistent with Civil Code section 1091 and C.C.P. section 1971. Defendant mistakenly focuses here on the fact that her purported lifetime lease could have terminated within a year instead of on the duration or term of the lease. A lifetime lease contemplates a duration or term of much longer than one year. Accordingly, even if Defendant’s sublease was for her lifetime, it is subject to the Statute of Frauds under Civil Code section 1624(a)(3) and is unenforceable.

Since Defendant does not have a valid and enforceable lease, Defendant fails to raise a triable issue of material fact as any affirmative defense.

3. PLAINTIFF’S REQUEST FOR JUDICIAL NOTICE

Plaintiff’s Request for Judicial Notice is GRANTED.

If the tentative ruling is uncontested, it shall become the order of the Court, pursuant to CRC Rule 3.1308(a)(1), adopted by Local Rule 3.10. If the tentative ruling is uncontested, moving party is directed to prepare, circulate, and submit a written order reflecting this Court’s ruling verbatim for the Court’s signature, consistent with the requirements of CRC Rule 3.1312. The proposed order is to be submitted directly to Judge Susan L. Greenberg, Department 3.