2018-00230751-CU-EI

John R. Barba vs. Carl Dexter

Nature of Proceeding: Motion for Preliminary Injunction

Filed By: Seibel, Brian D.

Plaintiffs John R. Barba and Alma Barba’s (collectively, “Plaintiffs”) motion for preliminary injunction is DENIED.

This action relates to community real property owned by Plaintiffs located at 8590 Meandering Way, Antelope, California (the “Property”). Mr. Barba executed three documents with defendants Carl Dexter and Carl Dexter, as Trustee for First Trust (collectively, “Defendants”): (1) a Trust Deed and Assignment of Rents, (2) a Foreclosure Cancellation Guaranty, and (3) a Note Secured by Deed of Trust. These documents were executed without the knowledge or consent of Ms. Barba. Therefore, Plaintiffs contends the documents are invalid and voidable.

Plaintiffs filed their complaint on April 11, 2018, alleging causes of action for quiet title, breach of contract, declaratory relief, accounting, and intentional and negligent misrepresentation. Plaintiffs contend Defendants have taken possession and control of the Property, placed a tenant in possession, collected rents, but failed to apply those rent proceeds to the First and Second Deeds of Trust for which the Property is security. The First Deed of Trust is held by Seterus, Loan No. 27998048. The Second Deed of Trust is held by Bank of America, Loan No. 5895287.

Plaintiffs seek a preliminary injunction enjoining and restraining Defendants and their officers, agents, employees, representatives from collecting, using, and applying any rents and profits from the Property for any purpose other than the monthly payment obligation to Bank of America, Loan No. 5895287. Plaintiffs also seek to require Defendants to deposit any excess rental amounts (after payment of the Bank of America Loan) into the client trust account of Plaintiff’s counsel and held until further order of the Court.

Legal Standard

“As its name suggests, a preliminary injunction is an order that is sought by a plaintiff prior to a full adjudication of the merits of its claim[s]. [Citation.]” (White v. Davis (2003) 30 Cal.4th 528, 554.) “The purpose of such an order ‘is to preserve the status quo . . . .

It ‘does not constitute a final adjudication of the controversy.’ [Citation.]” (Costa Mesa City Employees Assn v. City of Costa Mesa (2012) 209 Cal.App.4th 298, 305.)

“To obtain a preliminary injunction, a plaintiff ordinarily is required to present evidence of the irreparable injury or interim harm that it will suffer if an injunction is not issued pending an adjudication of the merits. (White v. Davis (2003) 30 Cal.4th 528, 554

[emphasis added]; see generally Code Civ. Proc. § 426, subd. (a)(2) [a preliminary injunction “may be granted . . . [w]hen it appears . . . that the commission or continuance of some act during the litigation would produce . . . great or irreparable injury . . . to a party to the action].)

“‘[T]he extraordinary remedy of injunction’ cannot be invoked without showing the likelihood of irreparable harm. [Citation.]” (Intel Corp. v. Hamidi (2003) 30 Cal.4th 1342, 1352.) The threat of “irreparable harm” must be imminent. “An injunction cannot issue in a vacuum based on the proponents’ fears about something that may happen in the future.[..i]t must be supported by actual evidence that there is a realistic prospect that the party enjoined intends to engage in the prohibited activity.” (Korean Philadelphia Presbyterian Church v. California Presbytery (2000) 77 Cal.App.4th 1069, 1084.) The showing must be strong enough to “support the exercise of the rather extraordinary power to restrain the defendant’s actions prior to a trial on the merits.” ( Tahoe Keys Property Owners’ Ass’n v. State Water Resources Control Bd. (1994) 23 Cal.App.4th 1459, 1471.)

“If the threshold requirement of irreparable injury is established, then [the court] must examine two interrelated factors to determine whether . . . a preliminary injunction should be [issued]: ‘(1) the likelihood that the moving party will ultimately prevail on the merits and (2) the relative interim harm to the parties from issuance or non-issuance of the injunction.’ [Citation.]” (Costa Mesa City Employees Assn., supra, 209 Cal.App.4th at 306 [emphasis added].) The greater the showing on one factor, the lesser the showing must be on the other. (Butt v. State of California (1992) 4 Cal.4th 668, 678.) However, a preliminary injunction may not be granted, regardless of the balance of interim harm, unless it is reasonably probable that the moving party will prevail on the merits. (San Francisco Newspaper Printing Co. v. Superior Court (1985) 170 Cal.App.3d 438, 442.)

The party seeking injunctive relief bears the burden of showing all elements necessary to support issuance of a preliminary injunction. (O’Connell v. Super. Ct. (2006) 141 Cal.App.4th 1452, 1481.)

“The ultimate goal of any test to be used in deciding whether a preliminary injunction should issue is to minimize the harm which an erroneous interim decision may cause.” (IT Corp. v. County of Imperial (1983) 35 Cal.3d 63, 73.)

Moreover, it bears repeating that courts will deny a preliminary injunction unless there is a reasonable probability that the plaintiff will be successful in his or her assertion of rights. (Continental Baking Co. v. Katz (1968) 68 Cal.2d 512, 528.) Public policy is implicated where an injunction is sought against a public agency, here DGS. A significant showing of irreparable injury is required because there is a “general rule against enjoining public officers or agencies from performing their duties.” (Tahoe Keys Prop. Owners Ass ‘n v. State Water Resources Control Bd. (1994) 23 Cal.App.4th 1459, p.1471.) A preliminary injunction will not be issued simply to prevent the possibility of some remote future injury. Issuing a preliminary injunction based only on a possibility of irreparable harm is inconsistent with courts’ characterization of injunctive relief as an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief. (Winter v. NRDC, Inc., (2008) 555 U.S. 7, 22.) Where the evidence is evenly balanced, the decision must be against the party who bears the burden on the issue.

Discussion

Here, Plaintiffs contend they will suffer irreparable harm if the preliminary injunction is not issued because without the rental income from the Property, they will be unable to pay the First and Second Deed of Trust obligations secured by the Property. In turn, those obligations will go into default, and there is a great risk the Property will go into foreclosure and be sold. Plaintiffs contend such foreclosure would cause irreparable injury and would significantly alter the status quo.

In support, Plaintiffs present the declaration of Mr. Barba. Therein, Mr. Barba declares he is the sole support of his family of four, all of whom currently reside with him in the family residence in Hayward, California. (Barba Decl. ¶ 5.) The Property, therefore, appears to be an investment property, not the homestead of Plaintiffs. If this rental income property were foreclosed upon and sold, there is no evidence Plaintiffs would be left homeless or irreparably harmed. Rather, they would have lost an income property. This is insufficient to demonstrate irreparable harm is imminent if the Court does not exercise its discretion to grant an injunction. The potential harm is purely financial. If the Property is wrongly foreclosed upon, money damages would provide a sufficient remedy for the lost investment. Injunctions of any kind (even prohibitory) will rarely be granted where a suit for damages provides a clear remedy. (Thayer Plymouth Center, Inc. v. Chrysler Motors (1967) 255 Cal.App.2d 300, 307; Pacific Decision Sciences Corp v. Superior Court (2004) 121 Cal.App.4th 1100, 1110.) “An injunction will not issue where ‘only money is involved'” because “there is no threat of irreparable harm, because monetary losses are compensable in damages.” (Rutter Group, Civil Procedure Before Trial, 9:524; Doyka v. Superior Court (1991) 233 Cal.App.3d 1134, 1136.) To obtain a preliminary injunction Plaintiff must demonstrate that monetary damages would not be an adequate remedy for the alleged wrongdoing. (Code Civ. Proc. § 526(a)(4) [injunction may be granted (4) When pecuniary compensation would not afford adequate relief.]; Estes v. Rowland (1993) 14 Cal.App.4th 508, 535 [“There is no right to equitable relief or an equitable remedy when there is an adequate remedy at law.” (11 Witkin, Summary of Cal. Law (9th ed. 1990) Equity, § 3, p. 681 italics in original); Brownfield v. Daniel Freeman Marina Hospital (1989) 208 Cal.App.3d 405, 410 [there must be an injury that “cannot be compensated by an ordinary damage award”].) Plaintiffs have failed to demonstrate monetary damages would not be an adequate remedy at law.

Further, the usual purpose of a preliminary injunction is to preserve the status quo pending hearing on the merits. (Continental Banking Co. v. Katz (1968) 68 Cal.2d 512, 528.) Here, Plaintiffs seek to replace the status quo and obtain their requested relief prior to a hearing on the merits. They seek an injunction that Defendants pay rents towards the Bank of America Deed of Trust and pay any excess into the client trust account with Plaintiff’s counsel.

The Court must be presented with evidence that great or irreparable harm is imminent unless an injunction issues and Plaintiffs have failed to meet this burden.

Even assuming Plaintiffs established irreparable harm, on the facts presented, Plaintiffs have not established a probability of success on their claims. Plaintiffs’ motion makes little to no effort in explaining how Plaintiffs are likely to succeed on any of their five causes of action. At most, Plaintiffs’ generally cite to authority establishing that a nonconsenting spouse to a transaction may bring an action to avoid a unilateral transfer of community property. The fact that the law permits an action to be brought

does not establish a likelihood of success on the merits. Moreover, in opposition, defendant Carl Dexter has presented his declaration, which indicates the property was in foreclosure and he entered into the written agreements with Mr. Barba to save the property from foreclosure. At his sole expense, Mr. Dexter stopped the foreclosure on the property, improved the property and prepared it for sale. Mr. Barba purportedly agreed to keep the first and second mortgages current, and when the renovation was completed by Mr. Dexter, agreed to list the property for sale. From the sale proceeds, Mr. Barba purportedly agreed to reimburse Mr. Dexter for his expenses in stopping the foreclosure by reinstating the second mortgage, and for the renovation repairs. Mr. Barba and Mr. Dexter would then split any remaining profit. Mr. Dexter declares Mr. Barba has failed and refused to list the property for sale, reimburse him for the expenses, or divide the profits as agreed. Mr. Dexter contends he did not know Mr. Barba was married and if he had known, he never would have cured the default or invested in the property without first having obtained Ms. Barba’s consent. (See Dexter Decl.)

Again, where the evidence is evenly balanced, the decision must be against the party who bears the burden on the issue. Here, Plaintiffs have provided little to no evidence as to how they would likely succeed on their claims and in opposition, Defendants have presented evidence indicating the claims may not be successful.

Accordingly, the motion is DENIED, without prejudice.

Defendant Carl Dexter’s request for judicial notice of recorded documents is granted.

Plaintiffs have indicated the incorrect address in its notice of motion. The correct address for Department 53 of the Sacramento County Superior Court is 813 6th Street, Sacramento, California 95814. Plaintiffs shall notify Defendants immediately.

The notice of motion does not provide notice of the Court’s tentative ruling system as required by Local Rule 1.06(D). Plaintiffs are ordered to notify Defendants immediately of the tentative ruling system and to be available at the hearing, in person or by telephone, in the event Defendants appear without following the procedures set forth in Local Rule 1.06(B).