This case was last updated from Los Angeles County Superior Courts on 05/30/2019 at 04:37:48 (UTC).

CITY OF AZUSA VS RICHARD FRANCIS HALL

Case Summary

On 11/16/2017 CITY OF AZUSA filed an Other lawsuit against RICHARD FRANCIS HALL. This case was filed in Los Angeles County Superior Courts, Pomona Courthouse South located in Los Angeles, California. The Judge overseeing this case is GLORIA WHITE-BROWN. The case status is Pending - Other Pending.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****9803

  • Filing Date:

    11/16/2017

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Other

  • Court:

    Los Angeles County Superior Courts

  • Courthouse:

    Pomona Courthouse South

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judge

GLORIA WHITE-BROWN

 

Party Details

Plaintiffs

AUSA CITY OF

CITY OF AZUSA A CALIFORNIA MUNICIPAL CORPORATION

Defendants

MORTGAGE ELECTRONIC REGISTRATION SYSTEMS

PROVIDENT FUNDING ASSOCIATES L.P.

HALL ALICE JUNE

HALL RICAHRD FRANCIS

HALL RICHARD FRANCIS

MORTGAGE ELECTRONIC REGISTRATION SYSTEMS INC.

Not Classified By Court

ADAMS MARK S.

Attorney/Law Firm Details

Plaintiff Attorneys

SILVER MATTHEW R.

SILVER MATTHEW RAYMOND

Defendant Attorneys

MCKENNA ESQ. CHARLES C.

MCKENNA CHARLES CHRISTOPHER

 

Court Documents

Order on Court Fee Waiver (Superior Court)

12/18/2017: Order on Court Fee Waiver (Superior Court)

Answer

12/28/2017: Answer

Case Management Statement

3/26/2018: Case Management Statement

Unknown

4/24/2018: Unknown

Unknown

4/24/2018: Unknown

Case Management Statement

5/10/2018: Case Management Statement

Unknown

5/22/2018: Unknown

Proof of Service (not Summons and Complaint)

5/23/2018: Proof of Service (not Summons and Complaint)

Unknown

5/25/2018: Unknown

Order

7/12/2018: Order

Declaration

8/2/2018: Declaration

Report of Receiver

8/3/2018: Report of Receiver

Minute Order

8/8/2018: Minute Order

Report of Receiver

9/28/2018: Report of Receiver

Case Management Statement

11/2/2018: Case Management Statement

Report of Receiver

11/9/2018: Report of Receiver

Notice

4/2/2019: Notice

Declaration

4/29/2019: Declaration

76 More Documents Available

 

Docket Entries

  • 04/29/2019
  • Declaration (March 2019 Monthly Accounting of Receivership Income, Expenses and Interim Fees); Filed by Mark S. Adams (Non-Party)

    Read MoreRead Less
  • 04/02/2019
  • Notice (NOTICE OF WITHDRAWAL OF TRICIA HALSTEAD); Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 03/22/2019
  • Notice (Notice of Case Management Conference); Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 03/20/2019
  • at 08:30 AM in Department J, Gloria White-Brown, Presiding; Case Management Conference - Held - Continued

    Read MoreRead Less
  • 03/20/2019
  • at 08:30 AM in Department J, Gloria White-Brown, Presiding; Hearing on Motion - Other - Not Held - Rescheduled by Party

    Read MoreRead Less
  • 03/20/2019
  • Minute Order ( (Case Management Conference)); Filed by Clerk

    Read MoreRead Less
  • 03/13/2019
  • Status Report; Filed by Mark S. Adams (Non-Party)

    Read MoreRead Less
  • 03/08/2019
  • Case Management Statement; Filed by Provident Funding Associates, L.P. (Defendant); Mortgage Electronic Registration Systems, Inc. (Defendant)

    Read MoreRead Less
  • 03/05/2019
  • Case Management Statement; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 02/15/2019
  • Order ((Proposed) Order Approving December 2018 Monthly Accounting); Filed by Mark S. Adams (Non-Party)

    Read MoreRead Less
96 More Docket Entries
  • 12/18/2017
  • Request to Waive Court Fees; Filed by Richard Francis Hall (Defendant)

    Read MoreRead Less
  • 12/18/2017
  • Request to Waive Court Fees; Filed by Alice June Hall (Defendant)

    Read MoreRead Less
  • 11/30/2017
  • Rtn of Service of Summons & Compl; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 11/28/2017
  • Rtn of Service of Summons & Compl; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 11/28/2017
  • Rtn of Service of Summons & Compl; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 11/28/2017
  • Rtn of Service of Summons & Compl; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 11/20/2017
  • Notice of Case Management Conference; Filed by Clerk

    Read MoreRead Less
  • 11/16/2017
  • Complaint; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 11/16/2017
  • Civil Case Cover Sheet; Filed by City of Azusa, a California municipal corporation (Plaintiff)

    Read MoreRead Less
  • 11/16/2017
  • Summons (on Complaint)

    Read MoreRead Less

Tentative Rulings

Case Number: KC069803    Hearing Date: February 21, 2020    Dept: J

HEARING DATE: Friday, February 21, 2020

NOTICE: OK

RE: City of Azusa vs Richard Francis Hall, et al. (KC069803)

______________________________________________________________________________

 

Non-party/Receiver Mark Adams’s Motion for Discharge of Receiver, Exoneration of Surety, and Order Directing Repayment of Fees and Costs

Responding Party: Plaintiff City of Azusa; Defendant Provident Funding Associates, L.P.; Defendant Mortgage Electronic Registration Systems, Inc.

Tentative Ruling

Background

This action arises from allegations State housing law violations pertaining to real property commonly known as 1010 North Alameda Avenue, Azusa, California 91720 (“the Property”). Defendants Richard Hall and Alice June are owners of the Property, and are alleged to have allowed trash and debris build up thereon, as well as other dangerous conditions.

On May 22, 2018, the Court granted Plaintiff City of Azusa’s (“Plaintiff”) request for appointment of a receiver, and appointed Mark Adams.

Receiver Mark Adams now moves to be discharged as receiver in this amtter, and to recover fees and costs.

Legal Standard

Pursuant to Health and Safety Code § 17980.7(c)(9), “[t]he receiver shall be discharged when the conditions cited in the notice of violation have been remedied in accordance with the court order or judgment and a complete accounting of all costs and repairs has been delivered to the court. Upon removal of the condition, the owner, the mortgagee, or any lienor of record may apply for the discharge of all moneys not used by the receiver for removal of the condition and all other costs authorized by this section.”

Discussion

On December 2, 2019, the Court noted that

The court is inclined to set an Order to Show Cause re: Discharge. The court believes that a continuation of the receivership, with no end in sight, for the sole purpose of monitoring recurrences of hoarding at the subject property is not appropriate and not what is intended by Health and Safety Code § 17980.7. The court will, at the time of the December 5, 2019 hearing, set a briefing schedule for the Receiver to file a final report and accounting, as well as for any oppositions thereto, and for Plaintiff to file a costs motion

(12/2/2019 Minute Order, p. 3.)

Adams now moves to be discharged as receiver, and submits a final accounting.

CRC Rule 3.1184 requires a receiver to submit a final report and account to obtain a discharge. The final account and report may be presented by noticed motion or by stipulation of all parties. Adams has submitted his final report and account by noticed motion.

Plaintiff and Defendants oppose this motion to be discharged, arguing that the amount to which Adams claims to be entitled is grossly excessive. Defendants argue that “while the Receiver should be discharged and the surety exonerated, Receiver’s request for payment should be denied - its fee should be substantially reduced, and any excess amount awarded above and beyond the Certificate amount should not be given priority status over Defendants’ lien.” (Defendants’ Opp. 2:23-26.) In turn, Plaintiff argues that the Court should reduce the receiver’s fees billed at a rate higher than authorized by the Court, eliminate various vague and double billing entries, and reduce the total fee award by $69,100. (Plaintiff’s Opp. 2:28.) Plaintiff also takes issue with Adams’ alleged lack of detailed billing to support his request.

Thus, neither opposing party argues against the discharge of Adams as receiver. Rather, the issues pertain to the total fees requested, the priority of said fees.

Receivers are entitled to compensation for their own services and the services performed by their attorneys. Venza v. Venza (1951) 101 Cal.App.2d 678, 680. Generally, the costs of a receivership are paid from the property in the receivership estate. Andrade v. Andrade (1932) 216 Cal. 108, 110. However, Courts may impose the receiver costs on a party who sought the appointment of the receiver and on a party who benefited from the receivership. Baldwin v. Baldwin (1947) 82 Cal.App.2d 851, 856. Courts are vested with broad discretion in determining who is to pay the expenses of a receivership, and the Court's determination must be upheld in the absence of a clear showing of an abuse of discretion. Id.

Adams seeks $164,164.18 in unpaid fees. (Adams Decl. ¶ 28.)

Plaintiff contends that Adams seeks $233,774 in fees, whereas Defendants contend that Adams seeks “a whopping grand total of $291,345.77.” (Def. Opp. 2:13.) Neither opposition paper provides what such figures represents nor how they reached such conclusion. As mentioned above, Adams’s papers reflect that the receiver seeks $164,164.18 in unpaid fees.

Plaintiff’s Opposition

As mentioned above, Plaintiff’s Opposition is limited to a challenge of the total amount of fees sought. Notably, Plaintiff argues that Adams has failed to produce detailed billing records for services provided in the receivership, and “respectfully requests that the Court order the Receiver to produce the detailed billing records supporting these exorbitant fees prior to making its ruling as to whether these fees are reasonable.” (Pl. Opp. 2:1-2.)

Indeed, no detailed billing entries have been submitted with this motion. Rather, it appears that Adams is relying on the monthly billing entries periodically filed in this action. Plaintiff’s counsel, Amanda R. Jones, submits a declaration in which she enumerates the various billing entries to which Plaintiff takes issue.

In reply to Plaintiff’s opposition papers, Adams argues that “[o]f course, not every filing and invoice is going to be resubmitted at the end of the matter, and instead, the amounts owed are compiled, categorized, and presented for review for both the Court and the parties by month.” (Reply to Pl.’s Opp. 2:18-20.) Adams addresses various of Plaintiff’s issues, including the use of 23 employees, increases in hourly fees, and alleged wasteful fee categorization.

Adams explains that the six employees who “were not authorized to work on this case” simply resulted from turnover at California Receivership Group. (Reply to Pl.’s Opp. 4:26.) The Court does not find that the use of 6 employees who were not named nor foreseen at the commencement of the receivership demonstrates a wasteful or inflammatory billing practice. Similarly, Plaintiff fails to submit grounds for its argument that an increase in hourly rate of certain employees over the course of this receivership spanning multiple years should be discounted from the receiver’s recovery.

As to the “duplicate billing entries,” Adams does not offer an explanation. Plaintiff provides the following examples of double billing:

On May 25, 2018, CJ Britz submitted two identical billing entries for "emails Servpro." (Jones 27 Decl. ¶ 6.) On June 1, 2018, CJ Britz submitted two billing entries for "Call from LL re surfboards." 28 (Jones Decl. ¶ 6.) On June 4, 2018, Christmas Meyers included three billing entries for the exact same thing, "Review and send Rapid Legal invoice to SS." (Jones Decl. ¶ 6.) On June 5, 2018, Mark Adams billed twice for "Prep, driving, travel to Azusa return - Facilitating cleanout/meeting with Residents (Hall Family)." (Jones Decl. ¶ 6.) On June 5, 2018, CJ Britz submitted two billing entries for "Talk to ET re car removal." (Jones Decl. ¶ 6.) On June 22, 2018, Mark Adams billed three times for "Email review and f/u w/ Butch Burnett regarding follow up for estimate for JMC for 1010 Alameda Avenue." (Jones Decl. ¶ 6.) On August 15, 2019, Sheila Vossough billed twice for "Email ET re inspections." 7 (Jones Decl. ¶ 6.)

(Pl.’s Opp. 6:26-7:7.)

In his reply, Adams states in a footnote that

[i]s it likely that CJ Britz (a lower level Operations staffer) sent two emails regarding Servpro (the cleanout company)? Is it likely that the paralegal sent three emails with invoices for filing fees? What are the chances that some of the tasks would have to be done two or more times in a month? These questions answer themselves, and the supposed “gotcha” invoices in the Opposition do nothing but show how detailed the fee records are. If these are the worst examples of waste or duplication, then certainly the Receiver and Court can be proud of how efficient this appointment was.

(Reply to Pl.’s Opp. 8, ft. 1.)

To the extent Plaintiff seeks to reduce the recovery by $867.50 for these entries, the Court agrees.

Plaintiff takes issue with the receiver’s billing entries for “organizing” and “cleaning out,” the Property, arguing that such entries are vague and in conflict with CRC 3.1184(d)’s requirement that the final account “state in detail what services have been performed by the receiver or the attorney . . .” (Pl.’s Opp. §§ F, G.) However, the receivership in this action was initiated to rectify the violations caused by a severe hoarding disorder and the subsequent accumulation of junk at the Property. The Court does not deem that a further specification of “organization” or “clean up” is needed to detail what billable activities took place at the Property, given the purpose of and need for this receivership. On July 11, 2017, an inspection of the Property led to a determination that 28 illegal conditions existed,

which are set forth at length on pages 5-11 of his declaration (including, but not limited to, general dilapidation or improper maintenance, accumulation of junk, trash and debris, inadequate means of ingress and egress, accumulation of combustible items, improper use of extension cords, lack of smoke alarms and carbon monoxide detectors, water damage, rodent and insect infestation, improper water heating facilities, improper kitchen sink, improper ventilation system improper window treatments, unsanitary kitchen, dilapidated roofing elements, unpermitted construction [patio covering], unlawful construction [shed], overgrown and dead vegetation, offensive animal odors and waste, dilapidated interior surfaces and inoperable motor vehicles.

(May 22, 2018, Minute Order, p. 5.)

Given the issues present at the Property, and the evidence present in the Court record, the Court does not find that the 75 hours and 79 hours for “organizing” and “cleaning up” require additional detailing. Nor does Plaintiff offer a factual basis as to why such hours were not necessary nor performed.

As to Plaintiff’s argument that the receiver has excessively billed for removal of a wood chipper from the Property, Plaintiff misrepresents the billing entries. Plaintiff argues that “[o]n July 9, 2018, Lou Laurenti billed 8.0 hours to confirm the removal of the wood chipper from the Subject Property,” whereas the billing entry actually provides that Lou Laurenti “responded to location par MA to remove wood shipper [sic] and BMW wood chipper towed and stored BMW was towed to back yard. Stood by and waited for low includes RT travel.” (July Monthly Report, p. 26.) As such, the argument is not well taken.

As mentioned above, “[t]he amount of compensation paid to a receiver is within the court’s discretion. People v. Riverside University (1973) 35 Cal.App.3d 572, 587, 111 Cal.Rptr. 68 [‘It is settled that fees awarded to receivers are in the sound discretion of the trial court and in the absence of a clear showing of an abuse of discretion, a reviewing court is not justified in setting aside an order fixing fees.’].”

Here, aside from the double billed entries calling for an $867.50 reduction of the total fees requested, Plaintiff has not demonstrated that the various targeted billing entries must be stricken from the receiver’s final accounting.

Defendants’ Opposition

In turn, Defendants oppose Adam’s motion to be discharged on the grounds that “Receiver has already been paid the full Certificate amount of $105,080, and now, at the eleventh hour, seeks an additional amount nearly twice that much. Not only are the fees questionable, but given the failure to seek, let alone receive, an increase in the Certificate amount, this request should be denied.” (Defs.’ Opp. 3:1-4.) However, Defendants fail to identify any particular billing entries with which it takes issue, nor does it provide grounds for the argument that the receiver shall not recover fees incurred in excess of the certificate.

Defendants argue that Defendants are entitled to priority over the payment sought by the receiver in excess of the Certificate amount. The Court agrees. On May 22, 2015, this Court ordered as follows:

‘With court authorization, a receiver may be authorized to issue receivership certificates as security for cash loaned to the receivership estate.’ Miller & Starr, 12 Cal. Real Est. (4th ed. 2017) § 41.12; see also, Dom v. Crank (1892) 96 Cal. 381, 382-384 and Title Insurance and Trust Co. v. Cal Development Co. (1915) 171 Cal. 227. A receiver’s certificate becomes a first lien on the property with priority overall all other preexisting liens if the court authorizes as much. Id. at 231.

City’s request for authorization of receiver’s certificate as first lien on the subject property is granted.

Thus, while the receiver has priority for the amount specified in the certificate, the amounts exceeding the certificate shall be subject to regular lien priority, and the excess amounts shall be junior to Defendants’ pre-existing lien on the Property.

In reply to Defendants’ opposition papers, Adams argues that the fees sought are not excessive because Defendants lenders did not partake in the maintenance of the Property, and are merely making a last minute “rock throwing” to reduce the receiver’s recovery. (Reply 6:19.) As discussed above, neither Plaintiff nor Defendants have demonstrated that Adams is not entitled to recover fees for services performed in this receivership action.

Based on the foregoing, Adams’ motion to be discharged as receiver is GRANTED in the reduced amount of $163,296.68.

Defendants Provident Funding Associates, L.P. and Mortgage Electronic Registration Systems, Inc.’s Motion to Terminate Receivership

Responding Party: Plaintiff City of Azusa; Receiver Mark Adams

Tentative Ruling

Background

This action arises from allegations State housing law violations pertaining to real property commonly known as 1010 North Alameda Avenue, Azusa, California 91720 (“the Property”). Defendants Richard Hall and Alice June are owners of the Property, and are alleged to have allowed trash and debris build up thereon, as well as other dangerous conditions.

On May 22, 2018, the Court granted Plaintiff City of Azusa’s (“Plaintiff”) request for appointment of a receiver, and appointed receiver Mark Adams.

Defendants Provident Funding Associates, L.P. and Mortgage Electronic Registration Systems, Inc. (“Defendants’) now contend that the receiver has fulfilled his purpose, and termination of the receivership is now warranted.

Legal Standard

Pursuant to Health and Safety Code § 17980.7(c)(9), “[t]he receiver shall be discharged when the conditions cited in the notice of violation have been remedied in accordance with the court order or judgment and a complete accounting of all costs and repairs has been delivered to the court. Upon removal of the condition, the owner, the mortgagee, or any lienor of record may apply for the discharge of all moneys not used by the receiver for removal of the condition and all other costs authorized by this section.”

Discussion

Defendants move the Court to terminate the receivership of Mark Adams on the Property, contending that he has admitted the violations to be cured, and that no justifiable reason exists for keeping the receivership open.

Defendants refer the Court to the July 3, 2019, Fourth Report of Receiver and Declaration of Mark Adams for their argument that “as recently admitted by the Receiver, all violations existing at the Property were cured after the February 2019 clean-up.” (Motion 5:15-16.) However, this reference appears disingenuous. Defendants cite only to the language that “[f]ollowing the clean-up on February 20-21, 2019,5 on inspections on March 19, 2019, April 11, 2019, April 24, 2019, May 23, 2019, and June 11, 2019, no additional incidents occurred.” (July 3, 2019, Adams Decl. ¶ 6.)

The Court is not convinced that the language of the report warrants a termination of the receivership. First, the statutory authority to which Defendants cite provides for a discharge of the receiver. Second, there do not appear to be grounds for a termination. Adams declares in his report that “[m]y team has continued to ensure the ongoing violations created by Glen Hall, son of Defendants Richard and Alice Hall (“the Halls”), are addressed and abated, while attempting to find a solution for the elderly Halls to remain in their home for the rest of their lives.” (Id. ¶ 1, emphasis added.) Adams further declares as follows:

my staff has continually had to monitor and subsequently abate violations that are created constantly on-site. It remains clear that Defendants acknowledge their son’s compulsion of hoarding and the need for him to “get help”, however they have been unable to manage it due to health conditions and their maternal and paternal relationship.

(Id. ¶ 6.)

Additionally, on November 21, 2019, Adams filed a declaration in which he declares as follows:

[m]y staff has continued to monitor the Property following the July 10, 2019 Case Management Conference continuance, and has continued conducting monthly inspections of the exterior and interior of the Property. This included inspections on July 8, 2019, July 22, 2019, August 19, 2019, September 23, 2019, October 10, 2019, and November 18, 2019. At each inspection, additional debris and junk items were discovered.

. . .

The November 18, 2019 inspection of the interior and exterior of the Property was conducted by representatives of the City of Azusa to determine if all violations were abated. I have not seen their report as of yet, but judging from the new collection of debris and junk items collected by Glen Hall, it is likely these violations still exist. Attached as Exhibit 2 are photos from the November 18, 2019 inspection.

(November 18, 2019, Adams Decl. ¶¶ 7-8.)

As of today, February 21, 2020, there is no clear indication that no on-going violative conditions persist at the Property. A report from July 3, 2019, more than 7 months before this hearing, in which the receiver references reoccurring violations, does not suffice.

Additionally, pursuant to Health and Safety Code § 17980.7(c)(9), a receiver shall be discharged only when “a complete accounting of all costs and repairs has been delivered to the court.” Although no final accounting had been submitted at the time of Plaintiff’s opposition, Adams filed a final accounting concurrently with his own motion to be discharged to be heard concurrently with this motion. Defendants have not met the burden of demonstrating the standards of Health and Safety Code § 17980.7(c)(9) have been met.

Based on the foregoing, Defendants’ motion for termination of receivership is DENIED.

Nevertheless, heard concurrently with this motion on February 21, 2020 , are Receiver Adams’s own Motion to be Discharged as Receiver, and Plaintiff’s Motion to Recover Fees and Costs for initiation and prosecution of this receivership action. Adams’s Motion to be Discharged renders the present motion moot in effect.

Plaintiff City of Azusa’s Motion to Recover Attorneys’ Fees and Costs

Responding Party: Defendants Provident Funding Associates, L.P. and Mortgage Electronic Registration Systems, Inc.; Receiver Mark Adams

Tentative Ruling

Background

This action arises from allegations State housing law violations pertaining to real property commonly known as 1010 North Alameda Avenue, Azusa, California 91720 (“the Property”). Defendants Richard Hall and Alice June are owners of the Property, and are alleged to have allowed trash and debris build up thereon, as well as other dangerous conditions.

On May 22, 2018, the Court granted Plaintiff City of Azusa’s (“Plaintiff”) request for appointment of a receiver, and appointed Mark Adams.

Plaintiff City of Azusa (“Plaintiff”) now moves to recover attorneys’ fees and costs “associated with its efforts to abate dangerous code violations on the Subject Property (“Receivership Action”). (Motion 1:4-5.)

Legal Standard

Pursuant to Health and Safety Code § 17980.7(d)(1), “[i]f the court finds that a building is in a condition which substantially endangers the health and safety of residents pursuant to Section 17980.6, upon the entry of any order or judgment, the court shall do all of the following:

(1) Order the owner to pay all reasonable and actual costs of the enforcement agency including, but not limited to, inspection costs, investigation costs, enforcement costs, attorney fees or costs, and all costs of prosecution.”

Discussion

Plaintiff moves the Court for an order awarding Plaintiff its attorneys’ fees and costs incurred in prosecuting this receivership action.

On May 22, 2018, in granting Plaintiff’s request for the appointment of a receiver, this Court relied on a city inspector’s opinion that “’the conditions on the subject property are so extensive and of such a nature so as to post an immediate and substantial danger to the health and safety of the residents and the public,’ and that ‘the appointment of a receiver is warranted in this case to address the serious and persistent violations on the subject property.’” (May 22, 2018, Minute Order, p. 6.) The subsequent ordered entered by this Court explicitly held that “[t]he building violations on the Subject Property are so extensive and of such a nature that A 19 the health and safety of the residents and the public is substantially endangered.” (May 22, 2019, Order Granting Receivership Motion ¶ 2.)

Plaintiff argues that the receivership was granted to remedy “a condition which substantially endangers the health and safety of residents pursuant to [HSC] Section 17980.6.” (Health & Safety Code § 17980.7(d)(1).) Plaintiff’s position is availing; the order’s language is clearly in line which the attorneys fee recovery provision of § 17980.7(d)(1).

Attorneys’ Fees

Counsel for Plaintiff, Amanda Jones, declares that Plaintiff’s Special Counsel has spent approximately 399.6 hours litigating this receivership action on behalf of Plaintiff. (Jones Decl. ¶ 5.) Plaintiff seeks $82,165.50 for Special Counsel reimbursement. (Id.) In lieu of attaching detailed billing statements, Jones provides a series of paragraphs detailing to a certain extent the time spent on this matter.

Plaintiff cites to Los Angeles County Bd. Of Supervisors v. Superior Court for its argument that “attorney billing records are protected by the attorney-client privilege while litigation is pending or active—Special Counsel’s billing records for this Receivership Action cannot be attached to this Declaration.” (Jones Decl. ¶ 7.) In Los Angeles County Bd. Of Supervisors v. Superior Court, the court held that

[t]o the extent that billing information is conveyed “for the purpose of legal representation”—perhaps to inform the client of the nature or amount of work occurring in connection with a pending legal issue—such information lies in the heartland of the attorney-client privilege. And even if the information is more general, such as aggregate figures describing the total amount spent on continuing litigation during a given quarter or year, it may come close enough to this heartland to threaten the confidentiality of information directly relevant to the attorney's distinctive professional role. The attorney-client privilege protects the confidentiality of information in both those categories, even if the information happens to be transmitted in a document that is not itself categorically privileged. When a legal matter remains pending and active, the privilege encompasses everything in an invoice, including the amount of aggregate fees. Los Angeles Cty. Bd. of Supervisors v. Superior Court (2016) 2 Cal. 5th 282, 297.

However, a request for fees must be support with evidence so that “a neutral judge [could] make a fair evaluation of the time expended, the nature and need for the service, and the reasonable fees to be allowed.” Jordan v. Multnomah Cnty. (1987) 815 F.2d 1258, 1263. “The evidence should allow the court to consider whether the case was overstaffed, how much time the attorneys spent on particular claims, and whether the hours were reasonably expended.” Christian Research Institute v. Alnor (2008) 165 Cal.App.4th 1315, 1320.

Here, for example, Jones begins her declaration as to hours expended into this matter by declaring that

[b]etween September and December of 2013, Special Counsel spent 21.9 hours obtaining the right to inspect the Subject Property, including drafting a compliance demand letter, communications with the Subject Property’s occupant regarding providing consent to inspect the Subject Property, drafting an application for an abatement warrant, obtaining the abatement warrant, and assisting City staff with the execution of the abatement warrant.

(Jones Decl. ¶ 10.)

In opposition, Defendants Provident Funding Associates, L.P. and Mortgage Electronic Registration Systems, Inc. (“Defendants”) argue that this action was initiated on November 16, 2017, more than four years after the hours claimed in paragraph 10 of the Jones declaration. However, Health and Safety Code § 17980.7(d)(1) provides for recovery of inspection and investigation costs. As actions taken in 2013 were a requisite step for the initiation of this action, Plaintiff shall recover expenses expanded therefor.

The remainder of Defendants’ opposition argues that the hours sought by Plaintiff are excessive for the tasks performed. Defendants contend that an entry of 36.5 hours for “Drafting 3-Day Notice and Complaint” is excessive. The Court agrees. A review of the 8-page complaint and 3-day notice does not reveal work of the complexity warranting 36.5 days of attorney time. Similarly, the Court finds that 25.6 hours for the preparation of the opposition to Defendants’ motion for termination of the receivership is excessive in light of Plaintiff’s succinct filing in that matter.

The court also finds that that the 29-hour entry for “Prepare advance filings and attend multiple status conferences and case management conferences,” is too vague to allow for a determination of the work performed. The entry does not provide any relevant dates or what filings were prepared.

The remaining entries raised in Defendants’ opposition to Plaintiff’s motion do not appear excessive.

Administrative Penalties

Plaintiff also requests that the Court authorize recovery of the remaining unpaid administrative penalties for code violations at the Property. Penalties amounted to $13,500, of which Defendant has paid $10,750. (McMinn Decl. ¶ 14.)

Plaintiff shall recover the remaining $2,750 in penalties.

Recovery of Fees

Plaintiff states that “[t]he new lender on the Court Receiver’s Certificate, Housing Group Fund, has agreed to increase the Court Receiver’s Certificate by $40,000 to cover $31,000 of the City’s fees and costs.” (Motion 14:3-4.) Jones declares that “[t]he current lender for the Court Receiver’s Certificate agreed to increase the Court Receiver’s Certificate by $40,000 to cover $31,000 of the City’s fees and costs without disturbing Defendant Alice Hall’s life estate in the Subject Property.” (Jones Decl. ¶ 37.)

Defendants do not oppose his request.

To the extent that counsel Jones declares under oath that the current lender has agreed to fund a $40,000 increase to the certificate, the Court authorizes an increase in the Court Receiver’s Certificate by $40,000, of which $31,000 shall cover the City’s attorneys’ fees and costs.

Plaintiff subsequently requests that “the Court authorize the City to recover its outstanding fees and costs in the amount of $59,205.55 as a super-priority lien on the Subject Property, co-equal with the lien securing the Court Receiver’s Certificate.” (Motion 15:8-10.) Plaintiff cites to Winslow v. Harold G. Ferguson Corp., where the court held that

[i]t would be wholly out of line with the traditional concept of equitable practice to pay the expenses of a receiver and the fees of his counsel prior to the participation of any creditor or beneficiary and at the same time to subordinate the payment of fees to the attorney who has invoked the powers of the court of equity to appoint that same receiver. The expense incurred by a litigant for legal services in causing the appointment of a receiver is as much an expense of administration as the charge of the receiver's counsel and should have priority to the same extent. Winslow v. Harold G. Ferguson Corp. (1944) 25 Cal. 2d 274, 284–85.

Although Plaintiff contends that it is entitled to a “super-priority lien,” the Winslow language suggests “same extent” priority. Id. Here, Plaintiff is recovering $31,000 of its fees from the now-increased Certificate. In light of the aforementioned excessive attorneys’ fees request, the Court reduces the total fees sought to $70,205.55. Thus, $39,205.55 remain to be recovered via subsequent lien. Pursuant to Winslow, the remaining $39,205.55 shall be secured by a lien co-equal with the lien securing the Court Receiver Certificate.

Based on the foregoing, Plaintiff’s Motion to Recover Attorney’s Fees and Costs in GRANTED in the reduced amount of $70,205.55.

Case Number: KC069803    Hearing Date: December 05, 2019    Dept: J

HEARING DATE: Thursday, December 5, 2019

NOTICE: OK

RE: City of Azusa v. Hall, et al. (KC069803)

______________________________________________________________________________

 

Defendants Provident Funding Associates, L.P. and Mortgage Electronic Registration

Systems, Inc.’s MOTION TO TERMINATE RECEIVERSHIP AND ORDER A FINAL

REPORT AND ACCOUNTING

Responding Party: Plaintiff, City of Azusa

Tentative Ruling

See below.

Background

Plaintiff City of Azusa (“Plaintiff”) seeks to enforce state housing laws and seeks the appointment of a receiver over the real property located at 1010 North Alameda Avenue in Azusa. On November 16, 2017, Plaintiff filed a complaint, asserting causes of action against Defendants Richard Francis Hall, Alice June Hall, Provident Funding Associates, L.P. (“Provident”), Mortgage Electronic Registration Systems, Inc. (“MERS”) and Does 1-50 for:

  1. Violation of State Housing Laws

On May 22, 2018, an “Order Granting Receivership Motion” was filed. On June 29, 2018, an “Amended Order Granting Receivership Motion” was filed.

A Case Management Conference is set for December 5, 2019.

Legal Standard

“The receiver is the agent of the court and not of any party, and as such: (1) Is neutral; (2) Acts for the benefit of all who may have an interest in the property; and (3) Holds assets for the court and not for the plaintiff or the defendant.” (California Rules of Court [“CRC”) Rule 3.1179.)

“The power to discharge a receiver [is]. . . a necessary adjunct to the power of appointment.” (Sly v. Superior Court of California in and for Los Angeles County (1925) 71 Cal.App. 290, 294.) “The power of a court of equity to remove or discharge a receiver . . .may be regarded as well settled, and it may be exercised at any stage of the litigation.” (Hozz v. Varga (1958) 166 Cal.App.2d 539, 544 [internal quotations and citation omitted].)

Upon completion of the receivership, the court may discharge the receiver upon the approval of the receiver’s account. The order of discharge also approves payment of any remaining claims to the receivership estate, the payment of any remaining expenses of administration, and compensation of the receiver. (Aviation Brake Systems, Ltd. v. Voorhis (1982) 133 Cal.App.3d 230, 232.)

Health and Safety Code § 17980.7(c)(9) provides that “[t]he receiver shall be discharged when the conditions cited in the notice of violation have been remedied in accordance with the court order or judgment and a complete accounting of all costs and repairs has been delivered to the court. . .” (See also Ahart, CAL. PRAC. GUIDE: ENFORCING JUDGMENTS & DEBTS (The Rutter Group 2018) ¶ 4:940 [“A receivership terminates upon completion of the duties for which the receiver was appointed; or at any other time upon court order”].)

Discussion

Provident and MERS move the court for an order terminating the receivership and ordering a final report and accounting, on the basis that all violations cited in the Notice and Order to Repair or Abate have now been cured and that continuation of the receivership would be for improper purposes.

Request for Judicial Notice

 

The court rules on Provident’s and MERS’ Request for Judicial Notice (“RJN”) as follows: GRANTED as to Exhibit 1 (i.e., Notice of Default and Election to Sell Under Deed of Trust recorded July 12, 2019).

Merits

On November 16, 2017, Plaintiff files its complaint for Violation of State Housing Laws, premised on 28 alleged code violations existing at the subject property. (Complaint, ¶19 and Exhibit B [i.e., Notice and Order to Repair or Abate (“N&O”)].) On May 22, 2018, an “Order Granting Receivership Motion” was filed. On June 29, 2018, an “Amended Order Granting Receivership Motion” (“”Amended Order”) was filed. The Amended Order authorized an initial Receiver’s Certificate of $20,000.00. In July 2018, the receiver filed a “Motion for Order Authorizing Increase to Receiver’s Certificate” (“Motion”), to a total of $232,000.00. With respect to remediation of the subject property, the Receiver indicated that the subject property had been “fully cleaned out” and sought an increase, in part, to accept a bid from JMC Concepts, Inc. to “thoroughly address[] the violations listed in the Notice and Order to Repair or Abate.” (Motion, 1:10-12 and 3:20-24; Adams Decl., ¶10.) The Motion also sought funds to provide for the subject property’s owner’s (i.e., Richard Francis Hall [“Richard”] and Alice June Hall [“Alice”]; collectively, the “Halls”) ongoing living expenses and for psychological treatment for the Halls’ adult son, Glen, whose extreme hoarding contributed to the violations in the first instance. (Motion, 1:12-21; Adams Decl., ¶¶3, 4 and 7.) Provident and MERS opposed the motion on the basis that the requested increase was excessive and that there was no authority that the Receiver could borrow funds to address issues such as the mental health of an adult occupant who contributed to the violations. The court determined that Provident’s and MERS’ position was “well taken” and, as such, the Motion was granted in the reduced amount of $85,080.00, for a total priority Receiver’s Certificate of $105,080.00. (See Order Authorizing Increase to Receiver’s Certificate filed August 13, 2018, ¶2.)

On July 3, 2019, the Receiver filed his Fourth Report. The Receiver states, “[f]ollowing the clean-up on February 20-21,2019, on inspections on March 19, 2019, April 11, 2019, April 24, 2019, May 23, 2019, and June 11, 2019, no additional incidents occurred.” (Adams Decl., ¶6.) This instant motion followed on August 14, 2019.

Plaintiff, in opposition, advises that Richard died in June 2019 and that, as such, the only occupants of the subject property are Alice and Glen. Plaintiff advises that Alice is at least partially blind and dependent upon Glen to take her to doctor’s appointments and provide for other basic care needs, and that Glen is still living at the subject property. Plaintiff states that the excessive accumulation of trash and debris is likely to continue on the subject property until Alice passes away and the subject property is sold or otherwise disposed of, and Glen is forced to vacate the subject property. Plaintiff represents that the Receiver has negotiated the transfer of the deed of trust for the Court Receiver’s Certificate to a lender who is willing to grant Alice a life estate on the subject property. Plaintiff argues that “without the Court Receiver’s continued monitoring of the Subject Property, the excessive accumulation of trash and debris on the Subject Property will continue unabated and there will be nothing to prevent the levels of trash and debris from returning to the conditions that necessitated the appointment of the Court Receiver in the first place.” (Opposition, 3:18-21.) Plaintiff’s Community Improvement Manager Rick McMinn (“McMinn”) advises that, based on his November 18, 2019 inspection of the subject property, the following violations identified in the N&O continue to exist: (1) Substandard Building. Accumulation of Junk, Trash and Debris. Fire Hazard. (2) Substandard Building. Accumulation of Combustible Items. Fire Hazards.(3) Substandard Building. Rodent and Insect Infestation and (4) Property Maintenance. Inoperable Motor Vehicles. (McMinn Decl., ¶29.)

The Receiver, in response, believes that the requested termination would only be appropriate if moving parties took on the ongoing monitoring of the hoarding and human situation at the subject property. The Receiver states that moving parties’ argument based on the July 3, 2019 Fourth Report ignores that conditions were only abated because of the Receiver’s ongoing efforts to keep it that way, not because conditions are “cured.” The Receiver attests that he has found a way to keep Alice in the subject property by its lender assigning the Receivership Deed of Trust to a new lender who agreed to provide effectively a life estate for Alice. (Adams Decl., ¶6.) The foreclosure on the receivership lien has been rescinded and a notice of rescission has been recorded as of November 13, 2019; the new lender has agreed not to attempt to foreclose again at least until Alice dies (Response, 7:16-17; Adams Decl., ¶6.)

The court is inclined to set an Order to Show Cause re: Discharge. The court believes that a continuation of the receivership, with no end in sight, for the sole purpose of monitoring recurrences of hoarding at the subject property is not appropriate and not what is intended by Health and Safety Code § 17980.7. The court will, at the time of the December 5, 2019 hearing, set a briefing schedule for the Receiver to file a final report and accounting, as well as for any oppositions thereto, and for Plaintiff to file a costs motion.