NATALIA TEACA ET AL VS JOSEPH WILLIAM MACFARLANE ET AL

Tentative Rulings

Case Number: BC546751    Hearing Date: January 19, 2021    Dept: 30

Dept. 30

Calendar No.

Teaca, et. al. vs. MacFarlane, et. al., Case No. BC546751

Tentative Ruling re: Creditor’s Motion to Assign Payment Rights

Judgment creditor A. Douglas Mastroianni moves for an assignment of payments due to judgment debtors Children Solution LLC, Kristina Kutsina, and Natalia Teaca. The motion is granted in part.

Code of Civil Procedure 708.510 provides for the assignment of payment rights to judgment creditors:

(a) Except as otherwise provided by law, upon application of the judgment creditor on noticed motion, the court may order the judgment debtor to assign to the judgment creditor. . . . all or part of a right to payment due or to become due…

“Except as otherwise provided by law, all property of the judgment debtor is subject to enforcement of a money judgment.” (Code Civ. Proc., § 695.010, subd. (a).)

Code of Civil Procedure § 708.510, subdivision (a) sets forth a nonexclusive list of the types of payments subject to such an assignment order, including but not limited to the following types of payments:

1) Wages dues from the federal government that are not subject to withholding under an earning withholding order.

2) Rents.

3) Commissions.

4) Royalties.

5) Payments due from a patent or copyright.

6) Insurance policy loan value.

The “assignment order” contemplated by Code of Civil Procedure section 708.510 must include a court order that assigns a right to payment outright. All or part of a right to payment due, or to become due, may be ordered assigned whether or not such rights are conditioned upon future developments. (Code Civ. Proc., § 708.510, subd. (a).)

In determining whether to order an assignment or the amount of an assignment pursuant to subdivision (a), the court may take into consideration all relevant factors, including the following:

(1) The reasonable requirements of a judgment debtor who is a natural person and of persons supported in whole or in part by the judgment debtor.

(2) Payments the judgment debtor is required to make or that are deducted in satisfaction of other judgments and wage assignments, including earnings assignment orders for support.

(3) The amount remaining due on the money judgment.

(4) The amount being or to be received in satisfaction of the right to payment that may be assigned.

(Code Civ. Proc., § 708.510, subd. (c).)

Here, the Court issued a judgment and awarded Jamie Riese and Oak Park Bright Child LP $351,145.60 in fees and costs under a contractual fee provision. That judgment was assigned to A. Douglas Mastroianni (Creditor).

The Judgment Debtors have refused to satisfy the judgment. Interest has accrued on the judgment since July 16, 2018. On April 26, 2019 Department 44 granted a motion to add interest and post-judgment costs to the judgment in the amount of $36,975.04. Judgment including those costs plus accrued interest has not yet been entered. (Mastroianni Decl., ¶ 5, Ex. C.)

Judgment Debtors argue that Creditor has not specified the source of the payments he seeks to have assigned. The Court disagrees. Creditor has identified the specific sources of recovery for which he seeks assignment: (1) monies to be paid to Children Solution LLC (Children Solution) from insurance proceeds and from government relief funds related to the Covid-19 pandemic; (2) monies to be paid to Kutsina and Teaca from Children Solution; and (3) monies to be paid to Children Solution by Kutsina and Teaca.

With respect to the exemptions to any assignment order, Judgment Debtors have not followed the proper procedures. A claim of exemption must be supported by a noticed motion filed with an “affidavit in support of the application that includes all of the matters set forth in subdivision (b) of Section 703.520. Failure of the judgment debtor to make a claim of exemption is a waiver of the exemption.” (Code Civ. Proc., § 708.550.) In addition, the notice of the motion must be “personally served on the judgment creditor not later than three days before the date set for the hearing.” (Code Civ. Proc., § 708.550, subd. (b).)

Here, Judgment Debtors did not follow the procedures for exemption and did not personally serve Creditor before the date set for the hearing. Instead, they served Creditor via email.

In addition, a financial statement must be filed with the claim of exemption if the claim is based on the support of the judgment debtor and his or her spouse and dependents. (Code Civ. Proc., § 703.530.) The Judgment Debtors’ declarations filed with the opposition do not meet the requirements of a financial statement pursuant to section 703.530.

With respect to Executive Order N-57-20, as an initial matter, Creditor argues that the Executive Order only applies to “individuals” and thus does not apply to Children Solution. Nowhere in the Executive Order is the word “individuals” defined. Regardless, by its express terms the Order applies only to “Financial Assistance made available under section 2201 of the CARES Act (concerning 2020 Recovery Rebates for Individuals), and any other federal-,state-,or local government financial assistance made available to individuals in express response to the Covid-19 pandemic. . . .” (See Opposition Ex. A, Executive Order.)

Thus, this Executive Order does not appear to apply to unemployment benefits, insurance benefits, or any other kind of benefits or monies payable by any party other than government assistance made to individuals “in express response to the Covid-19 pandemic.” Accordingly, the Court will not grant the motion with respect to items two and three of Creditor’s requested relief in the Notice of Motion, which seeks assignment of payments for Covid-19 relief. With respect to the other items, the Court grants the motion.