On 08/01/2012 GREAT PLAINS CAPITAL CORP filed a Contract - Debt Collection lawsuit against ARUTUN DEMIRCHYAN. This case was filed in Los Angeles County Superior Courts, Van Nuys Courthouse East located in Los Angeles, California. The Judge overseeing this case is RUSSELL STEVEN KUSSMAN. The case status is Disposed - Judgment Entered.
Disposed - Judgment Entered
Los Angeles County Superior Courts
Van Nuys Courthouse East
Los Angeles, California
RUSSELL STEVEN KUSSMAN
GREAT PLAINS CAPITAL CORPORATION
H 2 L FASHION
DOES 1 TO 100
DEMIRCHYAN ARUTUN DBA H 2 L FASHION
HARRIS NATHAN HENRY
GOST GEORGE TOM
3/4/2019: Memorandum of Costs After Judgment, Acknowledgment of Credit, and Declaration of Accrued Interest
3/18/2019: Writ of Execution
Writ of Execution ((Los Angeles)); Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Memorandum of Costs After Judgment, Acknowledgment of Credit, and Declaration of Accrued Interest; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Supplement; Filed by ClerkRead MoreRead Less
at 08:30 AM in Department Q; Hearing on Application for Order for Appearance and Examination - Not Held - Taken Off Calendar by CourtRead MoreRead Less
Minute order entered: 2016-10-28 00:00:00; Filed by ClerkRead MoreRead Less
Writ of Execution; Filed by PlaintiffRead MoreRead Less
Cost Bill After JudgmentRead MoreRead Less
Application and Order for Appearance and Examination; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
at 08:31 AM in Department Q; Hearing on Claim of Exemption/Third-Party Claim (Hearing-Claim of Exemption; Motion Denied) -Read MoreRead Less
Minute order entered: 2016-04-06 00:00:00; Filed by ClerkRead MoreRead Less
Minute order entered: 2012-12-18 00:00:00; Filed by ClerkRead MoreRead Less
Case Management Statement; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Request-Enter Judgment; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Notice-Rejection of Judgm Package; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Request-Dismissal-Partial; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Default Entered; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Proof of Service of Summons and Complaint; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Summons Filed; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Complaint; Filed by Great Plains Capital Corporation, (Plaintiff)Read MoreRead Less
Notice of Case Management Conference; Filed by ClerkRead MoreRead Less
Case Number: LC097976 Hearing Date: June 26, 2020 Dept: W
great plains capital corp. v. arutun demirchyan
Motion for sale of a dwelling
Date of Hearing: June 26, 2020 Trial Date: N/A
Department: W Case No.: LC097976
Moving Party: Great Plains Capital Corporation as assignee of Bank of America, N.A.
Responding Party: No opposition.
On January 18, 2013, judgment was entered against Judgment Debtor Arutun Demirchyan in favor of Great Plains Capital Corporation, as assignee of Bank of America, N.A. in the sum of $54,722.92. The current balance on the judgment inclusive of interest is $86,044.32.
Great Plains Capital Corporation, as assignee of Bank of America, N.A. (“Great Plains”) now seeks to sell real property of judgment debtor in order to satisfy the judgment.
Great Plains Capital Corporation, as assignee of Bank of America, N.A.’s Application for Order to Sell Dwelling is DENIED.
Code of Civil Procedure section §704.770 provides “(a) Upon the filing of the application by the judgment creditor, the court shall set a time and place for hearing and order the judgment debtor to show cause why an order for sale should not be made in accordance with the application. The time set for hearing shall be not later than 45 days after the application is filed or such later time as the court orders upon a showing of good cause.”
The court notes the hearing date was originally set no later than 45 days after the application was filed. Based on current conditions, including, but not limited to, the spread of Covid-19 disease, however, the hearing was postponed to June 26, 2020, which the court finds to be good cause within the meaning of Section 707.770.
A judgment creditor must obtain a court order of sale after a noticed hearing before a judgment debtor's real property dwelling may be sold at an execution sale. The main purpose of the hearing procedure is to determine whether the dwelling is subject to the homestead exemption, and to ensure that the debtor is paid the amount of the exemption if the property is sold.
A court order of sale is required to conduct an execution sale of a real property dwelling owned and resided in by a natural person judgment debtor. The 'dwelling' may be an individual debtor's house, condominium, planned development or mobile home affixed to land. (CCP §704.740(a); compare Gonzalez v. Toews (2003) 111 Cal.App.4th 977, 984 [Section 704.740 procedure inapplicable where debtor moved into property after levy].)
The application for sale must have a declaration which states: (1) the legal description of the property and the street address of the dwelling; (2) whether the records of the county tax assessor indicate whether there is a current homeowner’s or disabled veteran’s exemption for the dwelling; (3) whether the dwelling is a homestead and the amount of the homestead exemption, if addresses of the lien holders. (CCP §704.760.)
Local court rules require further evidence. LA Sup. Ct. Rule 3.223 requires:
(a) Evidence Required. An application for an order for sale of a dwelling must provide at the hearing competent evidence of the following:
(1) The fair market value of the property by a real estate expert;
(2) Litigation guarantee or title report that contains a legal description of the property, the names of the current owners, a list of all deeds of trust, abstracts of judgments, tax liens and other liens recorded against the property, whether a declaration of homestead has been recorded, whether a current homeowner’s exemption or disabled veteran’s exemption has been filed with the county assessor, and the persons claiming such exemption;
(3) The amount of any liens or encumbrances on the dwelling, and the names and addresses of the lienholders and when the judgment creditor’s lien attached. The judgment creditor must ascertain the precise amounts of obligations secured by senior liens by making a written demand for beneficiary statements from senior lienholders pursuant to Civil Code section 2943. The judgment creditor may need to conduct an examination pursuant to Code of Civil Procedure sections 708.120 or 708.130 to determine the precise amounts of the junior liens, the daily rate of interest due on the senior and junior liens, and encumbrances of record; and
(4) The date of service on the judgment creditor of the levying officer’s notice that the dwelling was levied upon.
(b) Certified Order. The clerk will provide the judgment creditor with a certified copy of the court order for transmittal to the levying officer. If the judgment was entered in another court, the clerk also will provide a certified copy of the order for transmittal to the clerk of the court in which the judgment was entered.
The order must specify the amount of the proceeds of the sale to be distributed to each person having a lien or encumbrance on the dwelling, and the names and addresses of those persons. (CCP §704.780.)
The declaration of George Gost provides the legal description of the property, commonly known as 14923 Greenleaf St., Sherman Oaks, CA 91403. (Gost Decl. ¶2.) Moreover, Mr. Gost declares that the records of the county tax assessor indicate there is no current homeowner’s exemption or disabled veteran’s exemption and there is no homestead exemption that has been recorded. (Gost Decl. ¶5.) However, Mr. Demirchyan is older than 65 years old and is therefore entitled to the benefit of the statutory homestead amount of $175,000.00 (Gost Decl. ¶5.) Mr. Gost also provides the fair market value according to the Brokers Price Opinion is $2,600,000.00. (Gost Decl. ¶7, Exh. 8.) The levying officer was served on February 21, 2020. (Gost Decl. ¶3; Exh. 1.) Moreover, Mr. Gost provides an order with the current balance for each senior lien holder or encumbrances on Judgment Debtors’ property. (Gost Decl. ¶6, Exh. 3.) The original declaration made reference to exhibits but they apparently were inadvertently omitted. On May 26, 2020, Gost submitted an amended declaration, which contains exhibits and additional information.
In the original order filed on March 10, 2020, the order does not specify the amount of the proceeds to be distributed to Toros Demirchyan. Great Plains contends that Toros Demirchyan does have a Deed of Trust against the property, but that Toros Demirchyan is the son of Judgment Debtor and Great Plains believes that the underlying obligation of the Deed of Trust has been extinguished and/or no longer enforceable due to the statute of limitations.
In an amended order filed on May 27, 2020, the order now states “Toros Demirchian, Instrument number 12-590293 is VOID and ZERO is to be paid to the lien holder.” Great Plains contends the Deed of Trust is unenforceable as there is no legal obligation between the Judgment Debtor and his son. Specifically, Great Plains argues a promise to make a gift is generally unenforceable. (Fritz v. Thompson (1954) 125 Cal.App.2d 858, 863.) Great Plains claims Toros Demirchyan received no benefit for the promise to support his parents; he made a few payments towards his father’s debts and received nothing in return. (Amended Gost Decl. ¶¶8-9, Exhs. 5, 7.) Alternataively, Great Plains argues that it is of little import whether the lien is valid or not, since there is enough equity in the house for all lienholders, including the son to get paid, and still have sufficient equity to pay Great Plains its debt.
First, the court notes Great Plains has failed to comply with Code of Civil Procedure section 704.780, which requires that not only must the order specify the amount of the proceeds to be distributed to each person having a lien, the names and addresses of those persons must be included as well. The original order and the amended order are missing the addresses of those individuals (and companies).
Second, the amended order and amended declaration were served by mail 31 days before the hearing. The court finds that an additional four days were required in order to provide proper service under Section 704.770(b)(1).
Third, Great Plains states in their declaration “see title report” but fails to attach one to the declaration. Great Plains does attach a Lot Book Report for the Judgment Debtors property. "Lot books are indexed by the legal descriptions of subdivided lots or divided parcels. They list all of the public records affecting the lots or parcels, as well as any other information maintained by the title company (such as prior reports). [See Bank of America Nat’l Trust & Sav. Ass’n v. Giant Inland Empire R.V. Center, Inc. (2000) 78 CA4th 1267, 1274, 93 CR2d 626, 630—“lot book report represents a snapshot of raw data that appears in the files of the particular branch of the title company” (internal quotes omitted)]" (D. The Preliminary Report, Cal. Prac. Guide Real Prop. Trans. Ch. 3-D.) Moreover, the Lot Book Report specifically states, “A Statement of Identification from the Settlors and/or Beneficiaries of the Arutun Demirchyan and Lusaber Danayan Family Trust, will be required to determine all liens and encumbrances affecting the subject property.” As such, it does not meet the requirement set forth in Los Angeles Superior Court, Rule 3.223(a)(2).
Lastly, the court disagrees with Great Plains’ that this court should find the Deed of Trust between Mr. Demirchyan, and his son, Toros Demirchyan, void. A fraudulent Deed of Trust must be provided for in the order of sale if it is superior to the judgment creditor’s lien. (See Kahn v. Berman (1988) 198 Cal.App.3d 1499, 1509.) Although Great Plains contends this action is not based on fraudulent conveyance as the original obligation is unenforceable, Great Plains also contends no obligation lies as the purpose of the transfer was to hide Mr. Demirchyan’s equity in his home from his creditors. As such, the court finds Great Plains argument is principally founded upon a fraudulent transfer. Moreover, the court declines to void the Deed of Trust as there has been some showing Toros Demirchyan paid his parent’s bills.
Based on the foregoing, the court denies the application without prejudice to a renewed application being submitted.
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