Memorandum Points and Authorities

Cal. Super. - 6th Dist.March 16, 2021

\DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO 21 CV379031 Santa Clara - Civil Stephen J. Kottmeier (State Bar N0. 77060) sjk@hopkinscarley.com Monique D. Jewett-Brewster (State Bar N0. 217792) mjb@hopkinscarley.com Rachael W. Hiatt (State Bar No. 3 17623) rhiatt@hopkinscarley.com HOPKINS & CARLEY A Law Corporation The Letitia Building 70 South First Street San Jose, CA 951 13-2406 mailing address: P.O. Box 1469 San Jose, CA 95109-1469 Telephone: (408) 286-9800 Facsimile: (408) 998-4790 Attorneys for Plaintiff CATHAY BANK, a California Banking Corporation Electronically Filed by Superior Court of CA, County of Santa Clara, on 4/5/2021 10:46 AM Reviewed By: S. Vera Case #21 CV379031 Envelope: 6171730 SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SANTA CLARA CATHAY BANK, a California Banking Corporation, Plaintiff, V. VIOLET PARVARANDEH and PIROOZ PARVARANDEH and DOES 1 through 50, inclusive, Defendants. 924\3726547.2 CASE NO. 2 1CV379031 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT Date: TBA Time: TBA Dept: TBA S.V MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO TABLE OF CONTENTS Page I. INTRODUCTION .............................................................................................................. 5 II. STATEMENT OF RELEVANT FACTS ........................................................................... 5 A. Plaintiff Extends Credit t0 Borrower in 2015 ......................................................... 5 B. The 2015 Loan Documents are Modified and Restated in 2020 ............................. 6 C. The Modified and Restated Loan Is Guaranteed in 2020 By Each of the Guarantors ............................................................................................................... 7 D. Borrower Defaults Under the Loan Documents ...................................................... 8 E. Guarantors Breached Their Guaranties Of The Loan ........................................... 10 III. LEGAL ARGUMENT ...................................................................................................... 10 A. The Applicable Legal Standard ............................................................................. 10 B. Plaintiff Is Entitled To A Right To Attach Order Against Each of the Guarantors ............................................................................................................. 10 1. Plaintiff s Claim is One upon Which a Writ ofAttachment May Be Issued ........................................................................................................ 1 1 2. Plaintiff’ s Allegations of Breach 0f Guaranty Establish the Probable Validity of Its Claim ................................................................................. 13 3. Plaintiff s Demand is a Fixed and/or Readily Ascertainable Amount, Within the Meaning of Code of Civil Procedure Section 483 .0 1 0 ...................................................................................................... 14 4. The Attachment Is Not Being Sought For Purposes Other Than Recovery On The Claim Upon Which The Attachment Is Based ............ 14 IV. CONCLUSION ................................................................................................................. 15 924\3726547.2 - 2 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO TABLE OF AUTHORITIES Page Cases Advanced Transformer Company v. Superior Court (1974) 44 Cal.App.3d 127 ....................................................................................................... 12 American Guaranty Corp. ofCal. v. Stoody (1964) 230 Cal.App.2d 390 ..................................................................................................... 13 Armstrong Petroleum Corp. v. Tri- Valley Oil & Gas C0. (2004) 116 Cal.App.4th 1375 ................................................................................................. 13 Baker v. Superior Court ofSan Diego (1983) 150 Cal.App.3d 140 ..................................................................................................... 11 Bank ofAmerica v. Salinas Nissan, Inc. (1989) 207 Cal.App.3d 260 ..................................................................................................... 13 Bringas v. Sullivan (1954) 125 Cal.App.2d 693 ..................................................................................................... 14 Cal. First Bank v. Braden (1989) 216 Cal.App.3d 672 ..................................................................................................... 13 Challenge Cream and Butter Association v. Royal Dutch Dairy (1963) 212 Cal.App.2d 901 ..................................................................................................... 11 Johnson v. Alexander (1976) 63 Cal.App.3d 806 ....................................................................................................... 11 Loeb & Loeb v. Beverly Glen Music, Inc. (1985) 166 Cal.App.3d 1110 ............................................................................................. 13, 15 Securily-First Nat. Bank v. Chapman (1940) 41 Cal.App.2d 219 ....................................................................................................... 12 United Central Bank v. Superior Court (2009) 179 Cal.App.4th 212 ............................................................................................. 12, 13 Wiener v. Van Winkle (1969) 273 Cal.App.2d 774 ..................................................................................................... 12 Statutes CiV. Code § 2856 .......................................................................................................................... 12 Code CiV. Proc. § 482.1 10 ............................................................................................................ 14 924\3726547.2 - 3 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT H TABLE OF AUTHORITIES (continued) [\J Page Code CiV. Proc. § 483.010 ...................................................................................................... 11, 14 #UJ Code CiV. Proc. § 483.010(a) ........................................................................................................ 11 U1 Code CiV. Proc. § 483.010(b) ....................................................................................................... 11 ON Code CiV. Proc. § 484.090 ...................................................................................................... 10, 15 \DOON 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY 92497265472 _ 4 _ Effigfiffimo MEMORANDUM 0F POINTS AND AUTHORITIES 1N SUPPORT OF APPLICATION FOR RIGHT T0 ATTACH ORDERS AND WRITs 0F ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO I. INTRODUCTION Plaintiff Cathay Bank, a California Banking Corporation (“Plaintiff”) hereby applies for the issuance of right t0 attach orders and writs 0f attachment in the amount 0f $10,928,576.97 (the “Application”).1 The Application is brought against each 0f the defendants Violet Parvarandeh, an individual (“V. Parvarandeh”), and Pirooz Parvarandeh, an individual (“P. Parvarandeh”). V. Parvarandeh and P. Parvarandeh are collectively referred t0 hereinafter as “Guarantors.” Plaintiff s Application arises from a $10,142,33 1 .77 commercial loan to VIMA Harrison 1, LLC (“Borrower”)2. Borrower defaulted 0n its loan obligations by failing t0 pay Plaintiff the amounts due thereunder, among other defaults. Guarantors also failed t0 pay all sums due despite demands by Plaintiff. Plaintiff therefore brought this action for breach of guaranty against the Guarantors, among other claims. For the reasons set forth in detail below, Plaintiff respectfully requests that the Court grant the instant Application. Plaintiff meets all 0f the requirements for the issuance of a right to attach order and writ 0f attachment against each of the Guarantors, Who are liable for the business debt of Borrower. II. STATEMENT OF RELEVANT FACTS A. Plaintiff Extends Credit t0 Borrower in 2015 On or about March 5, 2015, for valuable consideration, Plaintiff extended credit to US Immigration Investment Center, LLC, in the form 0f a loan (hereinafter the “Loan”) and other agreements in the original principal amount of Eleven Million, Two Hundred and Twenty Eight Thousand Dollars ($1 1,228,000.00). The Loan was extended pursuant to the certain instruments, documents, and agreements (hereinafter collectively the “2015 Loan Documents”) executed and delivered t0 Plaintiffby Borrower and others, including the following: a. That certain Promissory Note dated March 5, 2015 (hereinafter “2015 Note”), in the original principal amount 0f Eleven Million, Two Hundred and Twenty Eight 1 This figure includes principal, interest, and late charges totaling $10,883,576.97 as 0f March 11, 2021, plus estimated attorneys’ fees and costs of $45,000. (See Declaration of Counsel Rachael W. Hiatt In Support of Application For Right T0 Attach Orders and Writs 0f Attachment Against (“Hiatt Decl.”), 1] 2). 2 As will be explained in the factual recitation, this amount is a modified and restated loan from 2015. 924\3726547.2 - 5 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO Thousand Dollars ($1 1,228,000.00). (See Declaration of David Scheiber in Support of Application for Right t0 Attach Orders and Writs 0f Attachment (“Scheiber Decl.”) at EXh. A); b. That certain Deed of Trust dated March 5, 2015 (“Deed of Trust”), encumbering certain real property located in the County 0fAlameda, State of California, commonly known as 2332 Harrison Street, Oakland, California (the “Property”) and more particularly described in the Deed of Trust, which was recorded March 27, 2015, as Instrument N0. 2015081508 in the Official Records 0fAlameda County, California. (Scheiber Decl. at EXh. B). Per the terms 0f the Deed 0f Trust, it secures not only the original 2015 Loan Documents but also any replacements, modifications, etc. to the 2015 Loan Documents; c. That certain Business Loan Agreement (“2015 Loan Agreement”) dated March 5, 2015 (Scheiber Decl. at EXh. C); and d. Other related documents. On 0r about March 5, 2015, Defendant V. Parvarandeh executed that certain written Commercial Guaranty (the “V. Parvarandeh Guaranty”) in favor of Plaintiff, wherein, in exchange for Plaintiff s extension of credit t0 Borrower, Defendant V. Parvarandeh agreed to, among other things, unconditionally and irrevocably guaranty payment 0f all amounts Borrower owes Plaintiff under the 2015 Loan Documents and Borrower’s performance under the 2015 Loan Documents. (Scheiber Decl. at EXh. D). Also 0n 0r about March 5, 2015, Defendant P. Parvarandeh executed that certain written Commercial Guaranty (the “P. Parvarandeh Guaranty”) in favor 0f Plaintiff, wherein in exchange for Plaintiff s extension 0f credit to Borrower, Defendant P. Parvarandeh agreed to, among other things, unconditionally and irrevocably guaranty payment of all amounts Borrower owes Plaintiff under the 2015 Loan Documents and Borrower’s performance under the 20 1 5 Loan Documents. (Scheiber Decl., EXh. E). The V. Parvarandeh Guaranty and the P. Parvarandeh Guaranty are collectively referred to hereinafter as the “2015 Guaranties.” B. The 2015 Loan Documents are Modified and Restated in 2020 At some point between 2015 and February of 2020, Borrower changed its name to VIMA Harrison 1 LLC. (Scheiber Decl., 1] 8). In or about February 2020 at the request of Borrower and 924\3726547.2 - 6 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO Guarantors, Plaintiff agreed to modify and restate the 2015 Loan Documents. Accordingly, the terms and conditions of the 2015 Loan Documents were amended and restated in new loan documents, except for the Deed 0f Trust which continues to secure the Loan. (Id. at fl 9). Accordingly, 0n or about February 4, 2020 and for valuable consideration, Plaintiff extended credit to Borrower in the form 0f an amended and restated loan (hereinafter the “2020 Loan”) and other agreements in the original principal amount of Ten Million Forty-Six Thousand Seven Hundred Ninety-Five Dollars and Thirty-Two Cents ($10,046,795.32). The 2020 Loan was extended pursuant to the certain instruments, documents and agreements (hereinafter collectively the “2020 Loan Documents”) executed and delivered t0 Plaintiffby Borrower and others, including the following: e. That certain Promissory Note dated February 4, 2020 (hereinafter the “2020 Note”), in the original principal amount 0f Ten Million Forty-SiX Thousand Seven Hundred Ninety-Five Dollars and Thirty-Two Cents ($10,046,795.32) (Scheiber Decl., Exh. F); f. That certain Business Loan Agreement dated February 4, 2020 (“2020 Loan Agreement,” collectively with the 2015 Loan Agreement, the “Business Loan Agreement”) (Scheiber Decl., EXh. G); and g. Other related documents. (Scheiber Dec1., 11 10). Thereafter, Borrower and Plaintiff entered into that certain Payment Deferral Agreement dated May 20, 2020, as subsequently amended by that certain Amendment to Payment Deferral Agreement dated August 27, 2020 (collectively the “Payment Deferral Agreement”). (Scheiber Decl., EXh. H). The 2015 Loan Documents, the 2020 Loan Documents and the Payment Deferral Agreement are hereinafter collectively referred to hereinafter as the “Loan Documents.” (Scheiber Decl., 1] 12). C. The Modified and Restated Loan Is Guaranteed in 2020 By Each 0f the Guarantors On or about February 4, 2020, Defendant V. Parvarandeh executed a certain new written Commercial Guaranty (the “2020 V. Parvarandeh Guaranty”) in favor of Plaintiff, wherein in exchange for Plaintiff’ s extension of credit t0 Borrower, Defendant V. Parvarandeh agreed to, 924\3726547.2 - 7 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO among other things, unconditionally and irrevocably guaranty payment 0f all amounts Borrower owes Plaintiff under the Loan Documents and Borrower’s performance under the Loan Documents. (Scheiber Decl., Exh. I). Also 0n 0r about February 4, 2020, Defendant P. Parvarandeh executed a certain new written Commercial Guaranty (the “2020 P. Parvarandeh Guaranty”) in favor 0f Plaintiff, wherein in exchange for Plaintiff s extension of credit t0 Borrower, Defendant P. Parvarandeh agreed t0, among other things, unconditionally and irrevocably guaranty payment 0f all amounts Borrower owes Plaintiff under the Loan Documents and Borrower’s performance under the Loan Documents. (Scheiber Decl., EXh. J). The 2020 V. Parvarandeh Guaranty and the 2020 P. Parvarandeh Guaranty are collectively referred to hereinafter as the “2020 Guaranties.” Under their respective 2020 Guaranties, each 0f the Guarantors agreed t0 pay all expenses Plaintiff incurs to enforce the respective 2020 Guaranties, including, but not limited to, attorneys’ fees and costs. Further, each 0f the Guarantors waived any rights they may have had t0 require Plaintiff to proceed first against the Borrower 0r any other person, or t0 proceed against any security that may be held to secure performance of any 0f the obligations under the Loan Documents, or to pursue any other remedy whatsoever. (Scheiber Decl., 1] 15, and Exh. I and J thereto at p. 2 [“Guarantor’s Waivers”]). As reflected in the Note, the principal balance due and owing thereunder accrued interest at a variable rate 0f percentage points over the Prime Rate as Published in the Wall Street Journal (the “Index”). (Scheiber Decl. at 1] 10, Exh. F thereto). Also, in the event of Borrower’s default under the Loan Documents, the interest rate under the Note immediately increases by an additional 5.00 percentage point margin over the Index. (Id.). D. Borrower Defaults Under the Loan Documents Commencing January 1, 2020, and continuing thereafter, Borrower breached the terms and conditions of the Loan Documents in at least the following ways (collectively, the “Defaults”): A. Borrower’s failure to make the payments due under the Loan Documents from and after November 1, 2020; 924\3726547.2 - 8 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO B. Borrower’s failure t0 maintain the Debt Service Coverage Minimum of at least 1.300 t0 1.000 at FYE 2019 and at FYE 2020; C. Borrower’s failure to pay the Property taxes due in April 2020 and December 2020; D. Material adverse changes in Borrower’s financial condition, arising from, at least, (i) Borrower’s continuing failure to generate operating income by the Property; and (ii) the determination by Alameda County that the Property is seismically unfit with potential repair cost of $5,000,000 t0 $8,000,000; E. Borrower’s grant of a junior security interest in, and lien upon, the Property in favor of the Stephen Kerr Revocable Trust Without Plaintiff’ s prior written consent, in Violation of the “Collateral” provision in the Note; and F. Borrower’s incurring other indebtedness in Violation of the “Negative Covenants” provision in the Business Loan Agreement. (Scheiber Decl., 1] 16). On February 16, 2021, Plaintiff sent a letter t0 Borrower and Guarantors identifying the foregoing defaults and demanded that said defendants pay all sums due and owing under the Loan Documents. (Scheiber Decl., EXh. K.) Borrower and Guarantors thereafter failed to pay all sums due and owing, and Plaintiff proceeded t0 submit its Verified Complaint in the above referenced action for filing, which complaint was filed on or about March 16, 2020. (See Scheiber Decl., 1] 17; see also Request for Judicial Notice in Support of Application for Right t0 Attach Orders and Writs ofAttachment (“RJN”) at Exhibit 1). As of March 11, 2021, the amount owed is comprised of principal of $10,142,331.77, plus interest under the Loan Documents in the amount of $121,496.68 from January 1, 2020 through March 11, 2021 (interest at the Note rate accrues at the rate 0f $1,056.49 per day), plus interest at the Interest After Default Rate under the Loan Documents 0f $609,158. 10 from January 1, 2020 (0r such earlier date as the court may order) through March 11, 2021 (interest at the Interest After Default rate accrues at the rate of $1,408.66 per day), plus late charges of $10,590.42, for a total sum 0f $10,883,576.97 (the “Indebtedness”), exclusive of legal fees and costs. On March 12, 2021 and 0n each day thereafter, combined regular interest at the Note rate and Interest After 924\3726547.2 - 9 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO Default Rate continues t0 accrue under the Loan Documents at a daily rate of $2,465.15, subject t0 periodic adjustment based 0n the Index as set forth in the Note. (Scheiber Dec1., 1] 18). E. Guarantors Breached Their Guaranties Of The Loan In addition t0 making demand upon Borrower for payment, Plaintiff has made demand upon each of the Guarantors for payment. (Scheiber Dec1., 1] 17 and Exhibit K thereto). Each of the Guarantors has failed and refused to make payment. (1d,) On March 16, 2021, Plaintiff filed its Verified Complaint seeking t0 recover the amounts due and owing under the Note and Guaranties. (See RJN at Exhibit 1). As 0fMarch 11, 2021, there is due owing and unpaid from each 0f the Guarantors the sum 0f $10,883,576.97. (Scheiber Decl., 1] 18). As well as the foregoing amounts, other fees and costs, including attorneys’ fees and costs (estimated at $45,000.00 for the case) and have been and Will be incurred by Plaintiff. (See Scheiber Decl., 1] 19; see also Hiatt Decl. at 1] 2). III. LEGAL ARGUMENT A. The Applicable Legal Standard Pursuant to Code 0f Civil Procedure section 484.090, a right to attach order shall issue if the court finds that: 1. The claim upon which the attachment is based is one upon which an attachment may be issued; 2. The Plaintiff has established a probable validity 0f its claim upon which the attachment is based; and 3. The attachment is not sought for purposes other than the recovery of the claim upon which the attachment is based. (Code CiV. Proc. § 484.090). B. Plaintiff Is Entitled T0 A Right To Attach Order Against Each of the Guarantors In this matter, each of the requirements 0f Code of Civil Procedure section 484.090 is satisfied against each of the Guarantors. Plaintiff is therefore entitled t0 a right to attach order and writ of attachment against each of the Guarantors. / / / / / / 924\3726547.2 - 10 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO 1. Plaintiff’s Claim is One upon Which a Writ 0f Attachment May Be Issued Code 0f Civil Procedure section 483.010 defines the cases in Which attachment is authorized. A writ 0f attachment is appropriate for claims for money arising out 0f an express or implied contract where the total amount of the claim is fixed or readily ascertainable and not less than $500.00. (Code CiV. Proc. § 483.010(a)). A writ 0f attachment will issue on a claim that is unsecured. (Code CiV. Proc. § 483.010(b)). A plaintiff need only show by a preponderance of the evidence that the claim is one upon which an attachment may issue. (Johnson v. Alexander (1976) 63 Ca1.App.3d 806, 811 [because Plaintiff had met its burden in the lower court of demonstrating by a preponderance 0f the evidence that the claim was one upon which attachment could issue, the Court 0fAppeal refused t0 dissolve a writ of attachment issued by the lower court]). In an action against an individual, a writ of attachment is authorized on a claim: (1) for money; (2) based 0n contract, express or implied; (3) for a fixed or readily ascertainable amount not less than $500; that is (4) unsecured 0r only partially secured by any interest in real or personal property; and (5) which arises out 0f the conduct by the defendant 0f a trade, business, 0r profession. (Code Civ. Proc. § 483.010). The refusal t0 pay money or t0 perform an obligation to make a direct payment ofmoney pursuant to a contract is a basis upon which a writ of attachment may issue. (Challenge Cream and Butter Association v. Royal Dutch Dairy (1963) 212 Cal.App.2d 901, 908 [upholding writ of attachment from milk sold and delivered for Which defendant refused to pay]). The remedy 0f attachment is also available t0 the party seeking damages as a result of another party’s breach of contractual obligations and/or duties. (Baker v. Superior Court ofSan Diego (1983) 150 Cal.App.3d 140, 147). In the present case, a writ 0f attachment against each of the Guarantors is proper because Plaintiff has properly alleged a claim for breach of an express, written contract. Specifically, each of the Guarantors has failed to pay the Indebtedness under the terms 0f their respective Guaranties, which were executed in favor of Plaintiff. (Scheiber Decl., 1] 18). The Complaint on 924\3726547.2 - 11 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO file herein and the accompanying Scheiber and Hiatt Declarations establish Plaintiff’ s claim in the amount 0f $10,883,576.97. (See RJN at Exhibit 1; see generally Scheiber Decl. and Hiatt Decl.). Accordingly, the amount owed to Plaintiffby each 0f the Guarantors is a total amount well in excess of $500. (Id). The Guaranties are not secured by any interest in real or personal property, nor are they for personal, family or household purposes. (Scheiber Dec., 1] 20, Exhibits I and J thereto). Rather, the Guaranties were executed t0 enhance the credit worthiness 0f Borrower, Which benefited the trade or business in Which Guarantors are intimately involved-Which is asset management, immigration investment, and financial services businesses, among other things. (1d,, 1] 21; see also Advanced Transformer Company v. Superior Court (1974) 44 Cal.App.3d 127, 144 (holding that if the guarantor promoted his own profit through provision 0f credit t0 the primary obligor, a guarantee executed in the course of such activity is an obligation arising out 0f the conduct of the guarantor’s business». Furthermore, defendant V. Parvarandeh owns a fifty percent (50%) membership interest in Borrower and has signed documents 0n behalf 0f Borrower as “co-Member”. (Scheiber Dec., 1] 22, Exhibit L and M thereto). Plaintiff’s claims against Guarantors are, therefore, claims upon Which an attachment may be issued. In California, “[a] contract 0f guaranty gives rise t0 a separate and independent obligation from that which binds the principal debtor.” (Securily-First Nat. Bank v. Chapman (1940) 41 Cal.App.2d 219, 221; Accord, United Central Bank v. Superior Court (2009) 179 Cal.App.4th 212, 215). The Guarantors have breached their obligations t0 Plaintiff and is therefore liable to Plaintiff on claims independent of the claims against the Borrower. Furthermore, a guarantor is permitted t0 waive its right t0 require the creditor to proceed first against the primary borrower, and its right t0 the benefit 0f the security provided by the principal borrower. Here, each of the Guarantors waived any right he may have had t0 require Plaintiff t0 proceed first against Borrower, or any other guarantor, to proceed against any security that may be held t0 secure performance of any 0f the obligations under any loan documents, 0r to pursue any other remedy whatsoever. (Scheiber Decl., Exhibits I and J, at p. 2 therein). Those waivers are fully enforceable under California law. (Civ. Code § 2856; Wiener v. Van Winkle 924\3726547.2 - 12 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO (1969) 273 Cal.App.2d 774, 787; American Guaranty Corp. ofCal. v. Stoody (1964) 230 Cal.App.2d 390, 396). Accordingly, Plaintiff’s claims against Guarantors are unsecured claims for which writs 0f attachment may issue. (American Guaranty Corp. 0fCal., supra, 230 Ca1.App.2d at 394, 396 [Where a guarantor waives his right t0 the benefit of the security given by the principal guarantor, the debt is unsecured and a writ of attachment may issue]; United Central Bank v. Superior Court, supra, 179 Ca1.App.4th at 215-216 [lender entitled to right t0 attach order against guarantor Where guarantor waived right t0 require lender t0 pursue collateral for principal debt first]). 2. Plaintiff’s Allegations 0f Breach 0f Guaranty Establish the Probable Validity 0f Its Claim To obtain a writ 0f attachment, a plaintiff must also show probable validity of the claim. (Bank ofAmerica v. Salinas Nissan, Inc. (1989) 207 Ca1.App.3d 260, 271). A claim has probable validity if a Plaintiff makes a showing that it is more likely than not that the Plaintiff Will obtain a judgment 0n its claim against the Guarantors. (Loeb & Loeb v. Beverly Glen Music, Inc. (1985) 166 Ca1.App.3d 1110, 1118-20). In other words, Plaintiff need only present aprimafacie case t0 establish probable validity. With respect t0 its probability 0f prevailing on its breach 0f guaranty claims, Plaintiff need only demonstrate that: (1) Plaintiff and the Guarantors entered into a contract or contracts; (2) Plaintiff performed on the contract(s); (3) Guarantors breached the contract(s); and (4) Plaintiff has suffered damage as a result. (See Armstrong Petroleum Corp. v. Tri- Valley Oil & Gas C0. (2004) 116 Ca1.App.4th 1375, 1391; Cal. First Bank v. Braden (1989) 216 Ca1.App.3d 672, 674 [applying breach 0f contract analysis to claim that defendant breached guarantyD. Here, Plaintiff has established aprimafacie case of breach 0f guaranty against each of the Guarantors due t0 their failure t0 pay the sums due under their respective Guaranties after Borrower defaulted under the Loan Documents. (See, e.g., Scheiber Dec1., W 5-18). Indeed, the Guarantors cannot dispute the existence of the Guaranties, the underlying loan 0r that they failed and continue to refuse to make the payment required under the terms of the respective Guaranties 924\3726547.2 - 13 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT \DOONONUl-bUJNr-A 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS & CARLEY ATTORNEYS AT LAW SAN JOSE + PALo ALTO after Borrower defaulted under the Loan Documents. As a result, there is n0 reasonable justification for the Guarantors’ knowing and intentional breach 0f their respective Guaranties. Based on the facts set forth herein and the supporting declaration of David Scheiber, Plaintiff has established a primafacz'e case, and therefore, the probable validity 0f its claim against each of the Guarantors. Accordingly, a right t0 attach order and writ of attachment should issue against each 0f the Guarantors. 3. Plaintiff’s Demand is a Fixed and/or Readily Ascertainable Amount, Within the Meaning of Code 0f Civil Procedure Section 483.010 In order to establish that the amount claimed is in a fixed or readily ascertainable amount, all that is required is to be able t0 determine from the contract a basis for computation and a calculation Which is reasonable and definite. The fact that the damages are uncertain or must be proven at trial is no basis upon which to deny the application. (See, e.g., Bringas v. Sullivan (1954) 125 Cal.App.2d 693, 998-699). The Loan Documents and the Guaranties, together with the accompanying Declaration 0f David Scheiber, establish that the amount due and owing as of March 11, 2021 is $10,883,576.97, exclusive 0f attorney fees and costs. (Scheiber Decl. 1] 18). Code of Civil Procedure section 482.1 10 provides that a Plaintiff’ s application for a right t0 attach order and a writ of attachment “may include an estimate 0f the costs and allowable attorney’s fees.” (Code CiV. Proc. § 482.1 10). Here, attorney fees and costs are recoverable pursuant t0 the Loan Documents and the Guaranties. (Scheiber Decl., Exhibits B, F, G, H, I, and J). Accordingly, attorney fees and costs in the estimated sum 0f $45,000.00 may be included as part 0f the writ 0f attachment, bringing the total to $10,928,576.97. (See Scheiber Decl. at fl 19; Hiatt Decl., at 1] 2). Because Plaintiff s claim is fixed and readily ascertainable under Code of Civil Procedure section 483.010, a right to attach order and writ of attachment should issue in the amount 0f $10,928,576.97 against each of the Guarantors. 4. The Attachment Is Not Being Sought For Purposes Other Than Recovery On The Claim Upon Which The Attachment Is Based “The usual and main purpose 0f an attachment is t0 secure and insure the payment 0f any 924\3726547.2 - 14 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT AWNH \OOONQUI 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 HOPKINS 3: CARLEY ATTORNEYS AT LAW SAN JOSE o PALO ALTO judgment that may be recovered in the successful prosecution of an action in order that the ends of successful litigation are not fruitlessly pursued or frustrated.” (Loeb, supra, 166 Cal.App.3d at 1 1 18). The Application is being brought for a proper purpose- recovery 0f the amounts owed to Plaintiffby Guarantors. (See Code Civ. Proc. § 484.090. See also Scheiber Decl., 11 23). The amount due and owing by each of the Guarantors to Plaintiff as ofMarch 11, 2021, was not less than $ 10,883,576.97, Which includes unpaid principal, interest, late charges, and $45,000.00 in estimated attorneys’ fees and costs. This amount cannot be reduced by any sum because each of the Guarantors’ debt is unsecured. (Scheiber Decl. at 11 20). Therefore, it is appropriate t0 attach each of the Guarantors’ property in the full amount due and owing to Plaintiff, plus attorney fees and costs. Based upon the foregoing, the right to attach order is not sought for an improper purpose. A11 of the elements are satisfied and the Court should issue a right t0 attach order and writ of attachment against each 0f the Guarantors. IV. CONCLUSION Plaintiff respectfully requests the Court enter a right t0 attach order and issue a writ 0f attachment against each of the Guarantors in the amount of $10,928,576.97. Dated: April 5, 2021 HOPKINS & CARLEY A Law Corporation Monique . Jewett-Brewster Rachael W. Hiatt Attorneys for Plaintiff CATHAY BANK, a California Banking Corporation 924\3726547.2 - 15 - MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF APPLICATION FOR RIGHT TO ATTACH ORDERS AND WRITS OF ATTACHMENT