"06 ex parte app to stay judgment"
1 Frances M. Campbell (SBN 211563) 2 Anthony Carr, Of Counsel (SBN 123011) Law Office of Frances M. Campbell, 3 a Professional Corporation 8050 Melrose Avenue, 2nd Floor 4 Los Angeles, CA 90046 5 Tel: (323) 863-5290 Fax: (323) 944-0952 6 Attorney for Defendant Eurasian Auto Body, Inc. 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF LOS ANGELES, WEST DISTRICT 10 BEVERLY HILLS COURTHOUSE 11 PETE’S AUTO, INC., SIMON ) CASE NO.: 10U00096 12 SIMONYAN, ) [ASSIGNED TO THE HON. LESLIE ) E. BROWN, DEPT. 6] 13 Plaintiffs, ) 14 ) EX PARTE MOTION FOR STAY OF ) EXECUTION OF JUDGMENT FOR 15 ) POSSESSION PENDING APPEAL 16 ) [C. CIV. PROC. §§ 1176(A) / 918]; ) MEMORANDUM OF POINTS AND 17 v. ) AUTHORITIES 18 ) ) [[PROPOSED] ORDER LODGED 19 ) CONCURRENTLY HEREWITH] 20 ) ) Date: May 5, 2010 21 ) Time: 1:30 p.m. 22 EURASIAN AUTO BODY INC., et al., ) Dept.: 6 )) Trial date March 5, 2010 23 Defendants. ) Judgment entered April 2, 2010 24 ) Notice of Appeal filed May 4, 2010 ) 25 ) 26 ) ) TO THE COURT, AND TO THE PLAINTIFFS AND THEIR ATTORNEY OF 27 ) RECORD: 28 1 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 PLEASE TAKE NOTICE that Defendant Eurasian Auto Body, Inc. hereby 2 respectfully applies for an Order directed to Plaintiffs and to the Sheriff’s Department 3 of the County of Los Angeles, and to any other person acting on behalf of, or in concert 4 with Plaintiff, staying execution of the judgment for possession entered on April 2, 5 2010 in this matter and the writ of possession issued on April 22, 2010. 6 The application is made pursuant to Code of Civil Procedure sections 1176(a) 7 and 918 on the grounds that 8 (1) Judgment was entered against Defendant on April 2, 2010; 9 (2) the writ of possession was issued on April 22, 2010; 10 (3) Notice of Appeal was filed on May 4, 2010. Therefore, the April 2, 2010 11 judgment may be reversed, or the matter may be remanded to the Court with 12 instructions to take some other action affecting the rights of Defendant. 13 (4) Defendant will suffer considerable hardship if the judgment is not stayed 14 pending appeal, in that it will incur over $200,000.00 if it is forced to move, only to 15 potentially have the judgment against it vacated; and 16 (5) Plaintiff will suffer no hardship at all so long as the Order staying execution 17 of the Judgment is conditioned on Defendant’s payment of rent during the period of 18 the stay, in accordance with Medford v. Superior Court, 140 Cal. App. 3d 236 (1983). 19 The application is based on the Memorandum of Points and Authorities 20 attached hereto, the declarations of Frances M. Campbell and Joe Merdkhanian, upon 21 the Notice of of Appeal filed on May 4, 2010, and upon such other evidence and 22 argument as the Court may consider at the hearing. 23 Dated: November 6, 2012 Respectfully submitted, 24 LAW OFFICE OF FRANCES M. CAMPBELL 25 a Professional Corporation 26 27 By: __________________________________________ Frances M. Campbell 28 Attorney for Defendant Eurasian Auto Body, Inc. 2 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 MEMORANDUM OF POINTS AND AUTHORITIES 2 3 I. 4 INTRODUCTION 5 A. Relief Sought 6 This is a motion for stay of execution of the judgment for possession and writ of 7 possession pending appeal. The writ of possession was issued on April 22, 2010. The 8 lock-out date is imminent. On May 4, 2010, Defendant filed an appeal from the 9 Judgment entered against it on April 2, 2010. This application is made on the basis 10 that Defendant will suffer extreme hardship if such a stay is not granted, because it 11 will have to expend $200,000.00 in moving costs if it is forced to vacate pending 12 appeal. See Declaration of Joe Merdkhanian (the “Merdkhanian decl.”). The stay is 13 necessary to maintain the status quo pending the hearing on the 663 Motion. 14 B. Background 15 Defendant Eurasian Auto Body, Inc. leased the premises at 7500 Santa Monica 16 Boulevard on March 1, 2000. The lease was for five years, at the rate of $4,500.00 per 17 month, with two five-year options to renew. The lease provided that upon the exercise 18 by the lessee of the option to renew after five years, the rent would increase as follows: 19 Year 6 $4,612.50 per month 20 Year 7 $4,727.81 per month 21 Year 8 $4,846.00 per month 22 Year 9 $4,967.15 per month 23 Year 10 $5,091.32 per month 24 At the trial, Defendant testified through its principal that it gave the Plaintiff 25 notice that he was renewing the lease, and further testified that it paid rent according 26 to the schedule set out in the lease for years six through 10, although Defendant never 27 received a notice of rent increase. 28 /// 3 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 In December, 2009, Plaintiff prepared a Three-Day Notice to Pay or Quit, 2 claiming entitlement to rent in the amount of $2,273.96. The Three-Day Notice was 3 given contrary to the terms of the lease agreement, which provided for a period of two 4 months to cure any default in rent. While the Court found that Defendant did not 5 exercise its first option, since Plaintiff never served a notice of rent increase, Plaintiff 6 accepted $32,937.36 in excess rent paid by Defendant over the years. Because this 7 excess payment is more than the amount stated in the notice, Defendant contended 8 that no rent was due to Plaintiff and in fact that Plaintiff had been paid 9 approximately six months in advance. 10 II. 11 ARGUMENT 12 A. THE COURT HAS THE POWER TO STAY ENFORCEMENT OF THE 13 JUDGMENT FOR POSSESSION PENDING APPEAL 14 All courts have the power to stay enforcement of any judgment or order. Code 15 of Civil Procedure section 918 provides as follows: 16 (a) Subject to subdivision (b), the trial court may stay the enforcement of 17 any judgment or order. 18 If there is no stay of execution pending appeal, then the Sheriff’s Department 19 will evict Defendant, causing Defendant to incur approximately $200,000 in moving 20 costs. Then, even if the Defendant prevails on appeal, Defendant would have to 21 expend more money to reoccupy the premises. 22 B. CODE OF CIVIL PROCEDURE SECTION 1176(a) PROVIDES THAT 23 JUDGMENT MAY BE STAYED PENDING APPEAL WHERE DEFENDANT WILL SUFFER EXTREMENT HARDSHIP IF A STAY IS NOT GRANTED. 24 Code of Civil Procedure section 1176(a) provides in pertinent part as follows: 25 An appeal taken by the defendant shall not automatically stay 26 proceedings upon the judgment. Petition for stay of the judgment 27 pendingi appeal shall first be directed to the judge before whom it was rendered. Stay of judgment shall be granted when the court finds that 28 the moving paty will suffer extreme hardship in the absence of a stay 4 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 and that the nonmoving party will not be irreparably injured by its 2 issuance. 3 In this case, the Declaration of Joe Merdkhanian shows that Eurasian Auto 4 Body, Inc. will suffer extreme hardship if a stay of execution pending outcome of the 5 appeal is not issued by this court, because the business will expend approximately 6 $200,000.00 to move its location. See Merdkhanian Declaration. 7 In addition, if there is no stay of execution pending the appeal, then Plaintiff 8 will be free to, and most likely will, rent the subject premises to new tenants. Then, 9 even if the Defendant prevails on appeal, it will not likely be able to be restored to 10 possession of the premises. 11 C. EVEN IF THE COURT DOES NOT FIND EXTREME HARDSHIP HAS 12 BEEN SHOWN BY DEFENDANT, THE COURT HAS THE POWER TO GRANT A STAY OF EXECUTION PENDING APPEAL. 13 Even if the Court does not find that the Defendant has demonstrated extreme 14 hardship, the Court still has the power to stay execution of the Judgment and Writ of 15 Possession where a “substantial question will be raised on appeal,” the appellant will 16 suffer irreparable injury by an eviction prior to determination of the appeal, and that 17 the landlord will not be “sorely prejudiced.” See Mehr v. Superior Court, 139 Cal. App. 18 3d 1044, 1050 (1983). Nothing in Code of Civil Procedure section 1176(a) limits the 19 discretion of the Court in granting a stay even if no exreme hardship is shown. 20 While in many appeals, reversal for the tenants might be a remote possibility it 21 is not so in this appeal. There are many issues of law to be decided by the Appellate 22 Department in this case, for instance: 23 1. The issue of whether the notice correctly stated the exact amount of rent 24 due, when the Defendant had been been paying stepped-up lease payments pursuant 25 to its belief that it had exercised its option, is not an issue that has been directly 26 addressed on appeal in any case. As the Court will recall, this is not a case where the 27 28 5 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 Plaintiff estimated the amount of rent due—in this case Plaintiff posted a three-day 2 notice that purported to state the exact amount of rent due. 3 2. In addition, there is no published authority on whether stepped-up rent 4 provisions stated in a lease agreement that become effective only upon the lessee 5 executing an option can be fairly applied to a tenant that has not exercised the option, 6 or whether the landlord is then required to give a 30 day notice of rent increase if he 7 wishes to increase the rent on what has become a month-to-month tenancy. 8 3. Finally, there will be an issue on appeal of whether a 60-day cure period 9 for non-payment of rent, which applied to the first five years of the lease and not only 10 upon the execution of an option to renew, automatically become inapplicable if a 11 tenant does not exercise an option to renew. 12 The Appellate Division could very well rule differently from this Court on these 13 issues of law. 14 D. PLAINITFF WILL SUFFER NO HARM IF THE STAY IS GRANTED. 15 Despite the extreme hardship that Defendant will suffer if the stay sought 16 herein is not granted, Plaintiff will suffer no harm. Defendant is willing to pay the 17 monthly rental value into court, or directly to the Plaintiff, pending the outcome of the 18 appeal. Thus, Plaintiff would be protected from any adverse monetary consequences 19 resulting from the issuance of a stay. 20 E. THE COURT HAS NO POWER TO CONDITION THE STAY ON 21 PAYMENT OF THE JUDGMENT. 22 During yesterday’s hearing, the Plaintiff argued that any stay ought to be 23 conditioned on an Order that the Defendant pay the Judgment issued by the Court on 24 April 2, 2010 (presumably including attorneys’ fees). However, while it is appropriate 25 for the Court to condition the stay on payment of future rent during the stay, it would 26 be inappropriate for the Court to condition a stay on Defendant satisfying the 27 Judgment from which it is appealing. See Medford v. Superior Court, 140 Cal. App. 3d 28 236 (1983). The payment of going-forward rent is rationally related to protecting the 6 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 landlord from delay incident to the Court’s imposition of a stay. See id. at 240. 2 Requiring the deposit of disputed back rent and accrued damages is not, because it is 3 “not a consequence of granting such relief to the tenant.” See id. at 240-241. “The 4 landlord gains sufficient protection from the deposit of the contract rent as it becomes 5 due.” Id. at 241. 6 III. 7 CONCLUSION 8 For the foregoing reasons, Defendant respectfully requests that the Court issue 9 a stay of execution of the judgment for possession and writ of possession pending the 10 outcome of Defendant’s appeal of the Judgment. 11 Dated: November 6, 2012 Respectfully submitted, 12 LAW OFFICE OF FRANCES M. CAMPBELL 13 a Professional Corporation 14 15 By: __________________________________________ FRANCES M. CAMPBELL 16 Attorneys for Defendant Eurasian Auto Body, Inc. 17 18 19 20 21 22 23 24 25 26 27 28 7 MOTION FOR STAY OF JUDGMENT/EXECUTION PENDING APPEAL 1 DECLARATION OF FRANCES M. CAMPBELL 2 I, Frances M. Campbell, declare: 3 1. I am an attorney duly licensed to practice before all the courts of this 4 State and before this Honorable Court. I am the attorney for Defendant Eurasian 5 Auto Body, Inc. I represented Defendant at the trial of this matter. 6 2. This hearing date was set by the Court on May 4, 2010, with both counsel 7 present. All parties waived notice of the hearing. 8 3. On May 4, 2010, I filed a Notice of Appeal in this matter. A true and 9 correct copy of the Notice of Appeal is attached hereto as Exhibit A. 10 I declare under penalty of perjury under the laws of the State of California that 11 the foregoing is true and correct. 12 Executed on May 5, 2010, at Los Angeles, California. 13 14 _______________________________________ 15 FRANCES M. CAMPBELL 16 17 18 19 20 21 22 23 24 25 26 27 28 1 DECLARATION OF FRANCES M. CAMPBELL 1 DECLARATION OF JOE MERDKHANIAN 2 3 I, Joe Merdkhanian, declare as follows: 4 1. I am over the age of 18. I am the president of Eurasian Auto Body, Inc. 5 2. I started Eurasian Auto Body, Inc. at 7500 Santa Monica Boulevard in 6 March of 1999, and am in charge of its operations. The property was essentially an 7 empty shell. I had all of the equipment installed at that location. Since Judgment was 8 entered against me in this action, I have priced new locations, moving charges and 9 assembly costs by telephoning different vendors. Based on that experience, I have 10 estimated the cost of moving the business to a different location. All of these costs are 11 approximated based on my research: 12 a. Cost of rent and deposit at new location: $24,000.00 13 b. Cost of disassembling and moving equipment and set-up at new 14 location: $20,000.00 15 c. Cost of obtaining new permits and licenses: $2,500.00 to $5,000.00; 16 d. Bins and movers: $2,000.00; 17 e. Loss of business (approx. 2 weeks): $150,000.00. 18 I declare under penalty of perjury under the laws of the State of California that 19 the foregoing is true and correct. 20 Executed on April 5, 2010, at Los Angeles, California. 21 22 __________________________________ 23 JOE MERDKHANIAN 24 25 26 27 28 1 DECLARATION OF JOE MERDKHANIAN 1 Submitted by: 2 Frances M. Campbell (SBN 211563) Law Office of Frances M. Campbell, 3 a Professional Corporation 8050 Melrose Avenue, 2nd Floor 4 Los Angeles, CA 90046 5 Tel: (323) 863-5290 Fax: (323) 944-0952 6 Attorney for Defendant Eurasian Auto Body, Inc. 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF LOS ANGELES, WEST DISTRICT, BEVERLY HILLS COURTHOUSE 10 PETE’S AUTO, INC., SIMON ) CASE NO.: 10U00096 11 SIMONYAN, ) [ASSIGNED TO THE HON. LESLIE ) E. BROWN, DEPT. 6] 12 Plaintiffs, ) ) [PROPOSED] ORDER GRANTING 13 ) STAY OF EXECUTION OF 14 v. ) JUDGMENT FOR POSSESSION ) PENDING APPEAL 15 ) 16 EURASIAN AUTO BODY INC., et al., ) Date: May 5, 2010 ) Time: 8:30 a.m. 17 Defendants. ) Dept.: 6 18 ) Trial date March 5, 2010 ) Judgment entered April 2, 2010 19 ) 20 ) On May 5, 2010, Defendant Eurasian Auto Body, Inc., through counsel, moved ) 21 )) for a stay of execution of the judgment for possession entered on April 2, 2010, and the 22 ) writ of possession issued on April 22, 2010. Upon review of the moving [and opposing] ) 23 papers, and good cause appearing therefor, ) 24 ) IT IS ORDERED that the execution of)the judgment and writ of possession is 25 ) stayed pending outcome of the appeal filed on May 4, 2010. 26 ) 27 DATED: _______________________ _________________________________________ THE HON. LESLIE E. BROWN 28 JUDGE OF THE SUPERIOR COURT 1 PROPOSED ORDER