Case Name: Pace, et al. v. Pace, et al.
Case No.: 17CV305006

On January 10, 2017, plaintiffs Robert and Kathleen Pace (“Plaintiffs”) filed a complaint against defendants Todd Pace (“Todd”), Ana Lucia Pace (“Ana”), Star One Credit Union (“SOCU”), and Stearns Lending, Inc. (“Stearns”) (collectively, “Defendants”), asserting a single cause of action for partition by sale of property located at 17291 Zena Avenue in Monte Sereno, California (“Zena property”). The complaint alleges that Plaintiffs hold a 50% interest with right of survivorship in the Zena property, Ana and Todd hold a 50% interest in the Zena property, and Stearns holds a deed of trust in senior position, and SOCU holds a revolving credit deed of trust in second position. (See complaint, ¶¶ 11-16.) On February 23, 2017, Ana filed a cross-complaint against Plaintiffs, Todd, SOCU and Stearns, asserting causes of action for: constructive trust; resulting trust; quiet title; declaratory relief; breach of contract; breach of fiduciary duty; fraud; and, conspiracy. The cross-complaint alleges that in April 2009, Todd purchased the Zena property, and Todd told Ana that the title to the property would be shown as a 50% interest to Plaintiffs and a 50% interest to Todd and Ana. (See cross-complaint, ¶ 12.) The 50% interest was apparently given to Plaintiffs based on a $100,000 loan to Todd and Ana. (See cross-complaint, ¶ 13.) Escrow closed on May 20, 2009, in which Todd and Ana contributed $622,408, Plaintiffs providing $100,000, and the balance was borrowed from Wells Fargo Home Mortgage and secured by the property. (See cross-complaint, ¶ 17.) Ana asserts that Plaintiffs do not own a 50% interest as she believes that Todd and Ana owned 100% of the equity in the property. (See cross-complaint, ¶¶ 19, 26, 47; but see cross-complaint, ¶¶ 35 (alleging that “Ana believes that some amount may be due to Todd’s parents for the $100,000 loan made by them… Ana does not know the amount due on that loan… Ana acknowledges that to the extent any part of the loan remains due, Todd and Ana should pay it, or arrange for its payment”).)

On July 20, 2018, Ana propounded requests for production of documents (“RPDs”) on Plaintiffs. Plaintiffs provided responses consisting of objections. Ana moves to compel further responses.

Plaintiffs also move to quash the deposition subpoenas for production of business records to nonparties Sereno Properties Los Gatos, L.P. dba Sereno Group and Merrill Lynch, Pierce, Fenner & Smith, Inc.

Plaintiffs’ motion to quash

This motion seeks to quash or modify the subpoena for the production of business records of Sereno Properties Los Gatos, L.P. dba Sereno Group and Merrill Lynch, Pierce, Fenner & Smith, Inc. Plaintiffs argue that the requests violate rights of privacy, would not be helpful to Ana, and are not relevant, much less directly relevant.

Ana, in opposition, provides two and ¼ pages of an opposition, with three paragraphs of argument. Ana’s opposition asserts that “[e]ven if Plaintiffs’ and others’ rights of privacy are implicated by these subpoenas, any such privacy interests are overridden by the Defendants’ need for this discovery which is directly relevant to the ultimate question in this case.” (Opposition to motion to quash, p.3:14-20.) Ana does not cite to any authority to support her assertion regarding this argument. Instead, she merely states that “the Merrill Lynch subpoena seeks documents which go directly to prove how much Todd Pace paid his parents back for the $100,000 contribution they provided when the Zena Avenue property was acquired… the Sereno Group subpoena seeks documents concerning the Pace’s real estate transactions (and their communications with their real estate agent) which will inform whether or not Todd’s parents had any equitable interests in Todd Pace’s properties and if so, how much.” (Opposition to motion to quash, p.3:21-26.)

As Plaintiffs argue, there is a right of privacy as to a party’s confidential financial affairs. (See Cobb v. Super. Ct (Tleel) (1979) 99 Cal.App.3d 543, 550.) Clearly, the records that Ana seeks are within the recognized zone of privacy. Regardless, if the discovery sought invades a cognizable privacy interest, the proponent of the discovery must demonstrate the information sought is directly relevant to a claim or defense. (Alch v. Super. Ct. (Time Warner Entertainment Co.) (2008) 165 Cal.App.4th 1412, 1426-27, 1433.) If direct relevance is established, a court must then balance the right to privacy against the countervailing right to discover relevant information to litigate the case. (Id. at 1426-27.)

Here, Ana has not stated how exactly the information sought is directly relevant to her claims. Her argument in her separate statement does not assist either. The separate statement first summarizes her allegations, and then blithely concludes that “the entire history of Todd’s real estate transactions, dating back to at least 1991, when Cabernet was purchased, is relevant for the purposes of… [e]valuating the truth of the contentions of the litigants, including evaluating the truth of Todd’s parents’ contentions that they contributed their alleged equitable ownership rights in Linda Ave. and $100,000 towards the acquisition of Zena Ave… [e]valuating the credibility of Robert, Kathleen, and Todd… [p]reparing for trial… [e]valuating, and possibly, facilitating settlement positions and discussions… [and, e]valuating Ana’s rights to present further claims in this case.” (Separate statement in opposition to motion to quash, p.9:13-23.) Ana also asserts that “documents concerning Todd’s real estate transactions are directly relevant to the central issue in this case, raised by Todd’s parents, of whether they had an equitable interest in Cabernet, Linda Ave., and Zena Ave., and if so, when they had an interest, and how much of an equitable interest they had.” (Id. at p.9:24-27.) This response is referred to, or restated in each of the responses to requests in the separate statement. However, none of Ana’s statements in her separate statement discuss how each of the broad requests are necessary as to all records sought. For example, in Request numbers 1(C), 1(D), 5(A), 5(C), 5(D), 7(A), 7(C), and 7(D) to Sereno, they seek documents regarding Sereno’s representation of the parties as a renter. There is no discussion in the separate statement or the memorandum as to why those documents are directly relevant. Ana acknowledges that Sereno Group was not created until May 22, 2006; yet, she has no date restrictions as to her requests and seeks all documents since 1991. This also demonstrates that her requests are overbroad and not tailored to Sereno. Requests 1(D), 5(D), 7(D), and 9(E) to Sereno seek commission agreements. There is no discussion in the separate statement or the memorandum as to why commission agreements are directly relevant. Request 2(A)-(E) may be relevant if the documents pertain to Todd’s interests, but they also seek any communications sent by Sereno or received by Sereno concerning Todd Pace, his family, attorneys, friends and or acquaintances that mention Todd Pace. There is no discussion in the separate statement or the memorandum as to why all of these documents would be directly relevant. As to Plaintiffs’ argument that the documents would not be helpful to Ana, the Court agrees; however, that does not necessarily mean that the documents are not relevant. For example, the documents demonstrating a 50% interest in the other properties would be relevant to demonstrate intent, and this would only support Plaintiffs’ assertion that they had a 50% interest in the Zena property; such documents supporting this would be detrimental to Ana’s case, but are nevertheless relevant.

Requests 5(A) and 7(A) to Sereno seeks documents as to Sereno’s representation of Plaintiffs in the purchase of their own residence. This residence is not the subject of the action, and neither are the Cabernet nor Linda Ave. properties. Ana contends that Plaintiffs sold this house to their daughter, nonparty Dana Pace, and thus, she believes that “[t]he manner in which Todd’s parents dealt with Dana Pace regarding the Aptos property, as well as the manner in which Todd’s parents dealt with Dana generally, is relevant to Todd’s parents’ intra-family transfers of wealth.” (Separate statement in opposition to motion to quash, p.19:1-13.) This is entirely speculative and is certainly not directly relevant. The motion to quash as to requests 5(A) and 7(A) to Sereno is GRANTED.

Requests 5(C) and 7(C) to Sereno seeks documents concerning Sereno’s representation of Plaintiffs as a seller, buyer and/or renter of any real estate at any time in any and all other real estate transactions at any time. This likewise seems overbroad, and, in neither the opposition, nor her separate statement does she attempt to explain how all real estate transaction ever conducted by Plaintiffs—especially those not the subject of the instant action—could possibly be directly relevant.

Similar to Requests 2(A)-(E), Requests 6(A)-(E) and 8(A)-(E) to Sereno may be relevant if the documents pertain to Plaintiffs’ interests, but they also seek any communications sent by Sereno or received by Sereno concerning Plaintiffs, his family, attorneys, friends and or acquaintances that mention Plaintiffs. There is no discussion in the separate statement or the memorandum as to why all of these documents would be directly relevant.

Requests 9(A)-(E) and 10(A)-(E) to Sereno seek documents regarding nonparty Dana Pace and her purchase of the Plaintiffs’ home in Aptos, and her subsequent transfer of title back to Plaintiffs. Again, the Plaintiffs’ residence is not the subject of this action. The motion to quash as to requests 9(A)-(E) and 10(A)-(E) to Sereno is GRANTED.

As to Merrill Lynch, Ana is seeking all bank account records for Plaintiffs from January 1, 2009 to the present “without limitation” and as to any deposit or payment above $500. Clearly, these requests are within a recognized zone of privacy. Moreover, these requests are overbroad. For example, how a payment of $505 on a credit card balance for unknown, unrelated items is directly relevant to this action is beyond understanding, and Ana does not attempt to explain the relevance of such a payment in either her opposition or opposing separate statement. The motion to quash as to requests 1-3 to Merrill Lynch is GRANTED.

Parties shall appear at the hearing to further meet and confer as to the requests to Sereno. Personal appearance is required. CourtCall will not be allowed. If counsel cannot appear in person, CourtCall will be permitted only to select another hearing date.

Motion to compel further responses to RPDs

Ana also moves to compel further responses to RPDs 1-30. As with Ana’s opposition to the motion to quash, Ana’s memorandum in support of her motion to compel further responses is a scant 2 and ¾ pages with a single paragraph of argument. In this single paragraph, Ana does not address how she has any good cause for the requests. Ana’s reply papers are more helpful. The Court does not have record of any opposition, but Plaintiffs’ opposing arguments in their separate statement have been incorporated into Ana’s reply separate statement.

RPDs 1-7

RPDs 1-7 seek documents regarding Plaintiffs’ written and oral contracts with Todd since 1991, gifts to Todd since 1991, payments or transfer of money to Todd since 1991, checks written to Todd since 1991, and bank statements concerning gifts, payments, transfers or checks to Todd since 1991. Plaintiffs concede that there is good cause for all such documents as pertaining to the Zena Avenue, Cabernet Vineyards Circle and Linda Avenue properties, and have produced all such responsive documents within their control to which no objection is being made. However, Plaintiffs have objected to these requests on the grounds that they are vague, ambiguous, overbroad, attorney-client privilege, work product doctrine, privacy rights, and relevance. The objections to the requests, to the extent that they pertain to the Zena Avenue, Cabernet Vineyards Circle and Linda Avenue properties, on the grounds of relevance, vagueness, ambiguity, overbreadth, and privacy rights are OVERRULED. To the extent that these requests pertain to other properties, Ana has not demonstrated good cause. As to the attorney-client privilege and the work product doctrine, as to any documents withheld based on those objections, Plaintiffs shall provide a privilege log with sufficient detail so that Ana may evaluate the merits of the claim. (See Code Civ. Proc. § 2031.240, subd. (c)(1).); see also Lipton v. Super. Ct. (Lawyers’ Mutual Ins. Co.)(1996) 48 Cal.App.4th 1599, 1619 (stating that “[t]he party claiming the privilege has the burden to show that the communication sought to be suppressed falls within the terms of the claimed privilege”); see also Wellpoint Health Networks, Inc. v. Super. Ct. (McCombs) (1997) 59 Cal.App.4th 110, 130 (stating that “[t]he information in the privilege log must be sufficiently specific to allow a determination of whether each withheld document is or is not in fact privileged”).) Ana’s motion to compel a further response to RPDs 1-7 is GRANTED in part and DENIED in part. Plaintiffs shall provide verified, code-compliant further responses to RPDs 1-7 relative to the subject properties, and responsive, non-privileged documents within 20 days of service of this order.

RPDs 8-12

RPDs 8-12 seek documents concerning gifts, payments, transfers, and checks made by Todd to his parents since 1991, and bank statements regarding those. As to gifts made by Todd to his parents, Ana does not demonstrate good cause for such documents. Ana’s motion to compel a further response to RPD 8 is DENIED. As to RPDs 9-12, these documents might be relevant to the extent that they are related to the Zena Avenue, Cabernet Vineyards Circle and Linda Avenue properties, but it is difficult to understand—and Ana does not demonstrate—how the requests as stated are not overbroad. Ana does not demonstrate good cause for RPDs 9-12. Ana’s motion to compel a further response to RPDs 9-12 is DENIED.

RPDs 13-26

RPDs 13-26 seek documents relating to nonparties and siblings of Todd, Dana and Darci. Ana does not demonstrate good cause for these documents. Ana’s motion to compel a further response to RPDs 13-26 is DENIED.

RPDs 27-30

RPDs 27-30 seek Plaintiffs’ wills and living trusts created since 1991. Plaintiffs have objected on the grounds of privacy and overbreadth. These documents are clearly within a recognized zone of privacy. (See Estate of Gallio (1995) 33 Cal. App.4th 592, 597.) Ana must show a particularized need for the information sought. (See Britt v. Super. Ct. (San Diego Unified Port Dist.) (1978) 20 Cal.3d 844, 859-862.) Ana asserts that Plaintiffs’ “references in their wills or Trust to their alleged interests in Cabernet, Linda Ave. and/or Zena Ave., and how those interests would be divided between their children—and/or the lack of such references—are relevant to the issues in this case (of whether they ever had such interests) and to credibility.” (Ana’s reply separate statement, p.61:20-23.) It is entirely unclear as to whether any such references in the wills and living trusts are directly relevant. In balancing the interests involved, the Court finds that the interest in the claimed right of privacy outweighs the public interest in obtaining the documents and the objections based on privacy and overbreadth are SUSTAINED. Ana’s motion to compel a further response to RPDs 27-30 is DENIED.

The Court will prepare the Order.