Win Win Alexandria Union v. Hujazi CA2/8 ( 2016 )

Filed 1/20/16 Win Win Alexandria Union v. Hujazi CA2/8
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION EIGHT
WIN WIN ALEXANDRIA UNION, LLC, B257298
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. BC456257)
v.
MONICA HUJAZI,
Defendant and Appellant.
KEVIN SINGER,
Receiver.
APPEAL from an order of the Superior Court of Los Angeles County. James C.
Chalfant, Judge. Dismissed.
Monica Hujazi, in pro. per., for Defendant and Appellant.
Wolf, Rifkin, Shapiro, Schulman & Rabkin and Elsa Horowitz, for Plaintiff and
Respondent.
No appearance for Receiver.
_________________________
Win Win Alexandria Union, LLC (Win Win) filed suit against Monica Hujazi,
both individually and in her capacity as the trustee of the Zuercher Trust of 1999 (the
Trust), based on claims relating to two properties owned by the Trust. The trial court
appointed a receiver to maintain the properties and to collect the rents, issues and profits
they generated. After a foreclosure or bankruptcy sale at which Win Win bought the
properties, the trial court granted the receiver’s motion approving and settling his final
report and accounting. Hujazi now appeals, challenging the receiver’s fees. We dismiss
the appeal.
FACTUAL AND PROCEDURAL BACKGROUND
The Trust owned two residential apartment buildings in Los Angeles. In 2005,
East West Bank made two loans to the Trust, secured by deeds of trust against the
properties. According to the complaint in this matter, in 2010, the Trust defaulted under
the terms of the notes and deeds of trust by failing to pay amounts due. Hujazi had
executed personal guaranties in connection with the notes; she too failed to make the
payments due. In 2011, East West Bank sold the notes to Win Win. In March 2011,
Win Win filed a complaint for judicial foreclosure of the two properties. In addition to
foreclosure, the complaint sought specific performance for assignment of rents and the
appointment of a receiver. The complaint also alleged claims against Hujazi for breach
of the personal guaranties.
Win Win subsequently filed an ex parte application seeking appointment of a
receiver to take over the properties. According to declarations accompanying the
application, Hujazi and the Trust had mismanaged and neglected the properties to such an
extent that they had been placed in the Los Angeles City Housing Department’s Rent
Escrow Account Program. The trial court appointed receiver Kevin Singer.
The receiver performed services over the next three years. In November 2012,
the receiver notified the court that the Trust had filed a voluntary Chapter 11 bankruptcy
petition. In December 2012, the bankruptcy court issued an order excusing the receiver
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from turning over the properties.1 The bankruptcy court subsequently issued an order in
July 2013, authorizing and approving the sale of the properties, free and clear of all liens,
claims, and encumbrances. In September 2013, the bankruptcy court issued an order
approving a stipulation in the Trust’s Chapter 11 bankruptcy allowing the receiver to seek
approval of his final report and accounting in the trial court, provided no relief was
sought against the Trustee or the bankruptcy estate. In November 2013, the court issued
an order in what was apparently Hujazi’s personal bankruptcy, granting relief from the
automatic stay to allow the receiver to file the final account and report in the trial court,
provided no relief was sought against Hujazi or the bankruptcy estate.
In March 2014, the receiver filed motions for orders approving and settling his
final report and accounting. The receiver detailed the activities he had conducted,
including tasks such as interacting with tenants, securing proper insurance, negotiating
with the Los Angeles Housing Department regarding delinquent fees, engaging
contractors to conduct required repair work, and successfully rehabilitating the buildings
so that they were removed from the Rent Escrow Account Program. He had incurred
$344,025.80 in fees and expenses in connection with one property, and had already been
paid $320,492.95 from the property operations, or “through the funding of the
Receivership Estate provided by [Win Win].” Only $1,165.65 remained, which the
receiver proposed be satisfied with $981.29 remaining in the receivership trust account.
As to the other property, the receiver incurred $345,772 in fees and expenses. He had
already been paid $336,301.48, leaving $1,476.29, which he proposed be satisfied by
funds from the receivership trust account, with the remaining account balance to be
returned to Win Win. 2 The motions were accompanied by voluminous monthly bills
detailing the receiver’s activities and charges for each month.
1 We have granted Win Win’s unopposed request for judicial notice of orders issued
by the bankruptcy court. (Evid. Code, § 452, subds. (c), (d).)
2 The receiver had given the parties a “professional courtesy credit” of over $20,000
in connection with the first property, and nearly $8,000 on the second.
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Hujazi objected to the motion. She asserted the matter should be stayed due to her
bankruptcy, initiated in March 2013. Hujazi further asserted, through the declaration of
her counsel: “Notwithstanding that I believe this matter is stayed, the basis for the
receivers [sic] motion is not accurate to justify approval at this time. In addition, [Hujazi]
respectfully asserts that the charges of the receivership are excessive and unreasonable.”
Hujazi further claimed the receiver’s motion should not be approved because the sale of
one of the properties was not yet final.
At a hearing on the motion, the court overruled Hujazi’s objection based on the
alleged excessiveness of the receiver’s fees, noting there was nothing supporting the
objection. The court asked the parties about the contention that the automatic stay in
Hujazi’s bankruptcy should apply. It appeared that Hujazi’s counsel had not seen the
November 2013 order from the bankruptcy court allowing the receiver to proceed in state
court to have his final report and accounting approved. The court overruled the objection
and granted the receiver’s motion. This appeal timely followed.3
DISCUSSION
On appeal, Hujazi asserts the trial court abused its discretion in approving the
receiver’s final report and accounting. The argument appears to be based on the assertion
that the trial court made no deductions in the receiver’s requested fees, and this indicates
the trial court did not conduct an independent review of those fees. Hujazi further
suggests this court should undertake a review of the fees in the first instance. Respondent
contends the appeal must be dismissed because, due to the Trust bankruptcy, Hujazi has
no standing to pursue this appeal. We agree.
The record reveals that the Trust went into bankruptcy during the pendency of the
underlying litigation, and a bankruptcy trustee was appointed. “Upon the filing of a
petition for bankruptcy all of the debtor’s assets, including any interest in a cause of
action, pass to the trustee in bankruptcy. (11 U.S.C. § 541(a)(1)); [Citations.] An appeal
is a continuation of a cause of action. The action ‘is deemed to be pending from the time
3 Hujazi is self-represented on appeal.
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of its commencement until its final determination upon appeal, or until the time for
appeal has passed, . . .’ (Code Civ. Proc., § 1049; 9 Witkin Cal.Proc. (3d ed. 1985)
Appeal, § 1, p. 33.)”4 (People v. Kings Point Corp. (1986) 188 Cal.App.3d 544, 548-
549.)
The Trust owned the properties that were placed into receivership. A Chapter 11
Trustee was appointed, and it was he who sold and transferred the properties on behalf of
the Trust, with the approval of the bankruptcy court. Indeed, by the time of the receiver’s
final report and accounting, the properties had been transferred to Win Win. There is no
indication in the record that Hujazi had an interest in the receivership estate separate from
that of the Trust, or that she has any legal basis or authority to appeal a ruling regarding
fees paid or to be paid out of the receivership estate. (Bratcher v. Buckner (2001) 90
Cal.App.4th 1177, 1184 [only those legally aggrieved by an order have standing to
appeal—rights or interests must be injuriously affected].) The interests of the Trust
passed to the bankruptcy estate by operation of law, thus it was the Chapter 11 Trustee,
not Hujazi as trustee of the bankrupt Trust, who was the proper party to appeal any trial
4 Hujazi’s objection to the trial court’s approval of the receiver’s final report and
accounting is not a “cause of action.” However, it is a claim based on a purported
interest in the properties and receivership estate. Once the Trust filed for bankruptcy,
those interests in the property and receivership necessarily passed to the bankruptcy
estate. (See Bostanian v. Liberty Savings Bank (1997) 52 Cal.App.4th 1075, 1083-1084.)
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court ruling affecting the properties and relating to the Trust’s interests.5 (Kings Point,
supra, 188 Cal.App.3d at p. 549.)6
5 We also note it appears that Hujazi herself went into an involuntary Chapter 7
bankruptcy, which would mean claims directly affecting her also would be subject to an
automatic stay. The record is incomplete, however, regarding her individual bankruptcy.
In light of our determination that Hujazi’s objection related to an interest of the Trust
which had passed to the bankruptcy estate, depriving her of standing, we need not
consider the effects of her personal bankruptcy on her ability to appeal the trial court
ruling.
6 Moreover, even if Hujazi had standing, we would reject her arguments. It is a
fundamental principle of appellate review that we do not presume error. (Denham v.
Superior Court (1970) 2 Cal.3d 557, 564; Webman v. Little Co. of Mary Hospital (1995)
39 Cal.App.4th 592, 595.) This court will not independently search the record for error—
it is the appellant’s burden to identify error, with proper citations to the record and legal
argument. (Flores v. Department of Corrections & Rehabilitation (2014) 224
Cal.App.4th 199, 204; Fox v. Erickson (1950) 99 Cal.App.2d 740, 741-742.)
We would reject Hujazi’s arguments to the extent she simply asserts, without
support, that the trial court did not review the receiver’s fees before approving the final
report and accounting, or that the amount of the fees itself demonstrates their
impropriety. “The amount of fees awarded to a receiver is ‘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.’ [Citation.]” (Melikian v.
Aquila, Ltd. (1998) 63 Cal.App.4th 1364, 1368.) We do not presume error in the trial
court’s orders, and Hujazi has not provided any basis for us to conclude the trial court
failed to consider the necessary materials or to conduct an appropriate review prior to
approving the receiver’s final report and accounting.
To the extent Hujazi identified a small number of the receiver’s charges as
inappropriate because they were beyond the scope of the receiver’s authority, or based on
the dates of the services provided, she forfeited the objection by failing to raise it in the
trial court. The trial court is in the best position to evaluate the receiver’s fees. Hujazi
now contends some of the receiver’s actions were beyond the scope of authority granted
by the court, based on the short descriptions of services provided in the billing
statements. Had she raised the argument in the trial court, an appropriate factual record
may have been developed. She did not.
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DISPOSITION
The appeal is dismissed. Respondent is awarded costs on appeal.
BIGELOW, P.J.
We concur:
RUBIN, J.
FLIER, J.
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