JONATHAN EFRIN GALLEGOS VS. PARK PLACE FINANCE, LLC ET AL

As

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such, Defendants have satisfied the requirements of Evidence Code § 453 and the request for judicial notice is granted. LIS PENDENS On May 15, 2026, Plaintiff filed a First Amended Verified Complaint against Park Place Finance LLC, Servis One, Inc. dba BSI Financial Services, Ellington Management Group, LLC, Pacific Life Insurance Company, Maxton Builders, Inc., Valentin Razumovsky, Old Republic Title Company, Cheryl Mallory, JM Insulation Group, Jose Guadalupe Medina, Citadel Spaces, and Alexander Eidemiller.

Defendants filed this motion to expunge notice of lis pendens on June 22, 2026. Defendants claim as the basis for the court to expunge that Plaintiff cannot show a valid real property claim. “A party who asserts a claim to real property can record a notice of lis pendens, which serves as notice to prospective purchasers, encumbrancers and transferees that there is litigation pending that affects the property.” (Amalgamated Bank v. Superior Court (2007) 149 Cal.App.4th 1003, 1011, 57 Cal.Rptr.3d 686 (Amalgamated Bank).) “A lis pendens acts as a cloud against the property, effectively preventing sale or encumbrance until the litigation is resolved or the lis pendens is expunged.” (Ibid.) “A party to an action who asserts a real property claim may record a notice of pendency of action in which that real property claim is alleged,” commonly known as a lis pendens. (§ 405.20.)

Such a party is a “ ‘[c]laimant’ ” for purposes of the lis pendens statute. (§ 405.1.) Once recorded, any party with an interest in the property can move to expunge the lis pendens pursuant to the procedure set forth in section 405.30. A comment to section 405.30 identifies four bases upon which expungement may be sought: (1) the lis pendens is void and invalid (§ 405.23), (2) the action as pleaded does not contain a real property claim (§ 405.31), (3) the claimant fails to establish the probable validity of the claim (§ 405.32), and (4) monetary relief provides an adequate remedy (§ 405.33). (Code com., 14A West's Ann.

Code Civ. Proc. (2004 ed.) foll. § 405.30, par. 2, pp. 336–337.) J&A Mash & Barrel, LLC v. Superior Ct. of Fresno Cnty. (2022), 74 Cal. App. 5th 1, 15–16. The Plaintiff has the burden of proof that the notice lis pendens is valid. Validity of Real Property Claims Plaintiff’s First Amended Complaint (“FAC”) includes causes of action for (1) quiet title and cancellation of instruments; (2) slander of title; (3) disgorgement under Bus. & Prof. Code §§ 7031 and 17200; (4) breach of fiduciary duty (only as against Old Republic Title Company); (5) negligence and enterprise liability and (6) intentional interference with prospective economic advantage.

Defendants contend that only the first and second causes of action could potentially

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be considered real property claims, as the remaining causes of action seek primarily monetary relief rather than a relief affecting title to real property. Defendants assert that Plaintiff cannot establish the probable validity of either claim, as: 1) Plaintiff lacks standing as a stranger to the loan contract to bring these claims; 2) Plaintiff fails to name the actual lender, indispensable party Park Place Finance, Inc.; 3) the allegations basing the quiet title and cancellation claim are disproven by the public record; 4) the borrower has not tendered the indebtedness due under the loan; 5) Plaintiff cannot establish a false statement as to title to prevail in slander of title; and 6) Plaintiff’s remaining causes of action do not relate to real property.

Defendants further request attorney’s fees and costs in the amount of $2,940.00 pursuant to Code of Civil Procedure § 405.38. Plaintiff’s claims for Quiet Title and Cancellation of Instruments and Slander of Title are real property claims, while his remaining causes of action do not support a lis pendens.

1. Standing Defendants assert that Plaintiff was not a party to the underlying loan and the Construction Deed of Trust, Assignment of Rents, Security Agreement and Fixture Filing (the “DOT”) and accordingly lacks standing to make any challenge related thereto. Plaintiff asserts that he has standing, as the Quitclaim Deed recorded on March 16, 2026, conveyed the property to him as an individual eleven days before the March 27, 2026, Notice of Default, as well as individually guaranteeing the construction loan obligations on November 22, 2024. The FAC also identifies Plaintiff as the recorded fee owner of the subject property. The Quitclaim Deed conveyed the property to Plaintiff as an individual. As the record title holder at the time the Notice of Default was recorded, Plaintiff holds a direct ownership interest in the property at issue and accordingly has standing.

2. Indispensable Party Defendants contend that Plaintiff correctly notes the lender of the DOT was Park Place Finance, Inc.; however, Plaintiff does not name this entity as a defendant, but rather Park Place Finances, LLC. Plaintiff’s response does not address the failure to name Park Place Finance, Inc. However, Plaintiff does argue that a Request for Entry of Default has been filed against Park Place Finance, Inc. on July 2, 2026, therefore Defendants cannot use this motion to validate the title rights of nonappearing defaulted entities without first establishing their own authority and connection to the recorded instrument.

Upon review of the Court’s file, the FAC does not name Park Place Finance, Inc. as a defendant, despite mentioning the entity throughout the pleading. However, a Summons was issued on May 15, 2026, which included Park Place Finance, Inc. as a Defendant and was thereafter personally served. A Proof of Service of Summons was filed on June 15, 2026. Service

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of the Summons and FAC on Park Place Finance, Inc. does not bring the entity into the action without being named as a defendant in the FAC. Nevertheless, Plaintiff’s failure to name Park Place Finance, Inc. in the FAC is a curable defect as opposed to a showing of being unable to prevail on the merits of the claims.

3. Quiet Title and Cancellation of Instruments Defendants assert that Plaintiff cannot establish a likelihood of success on the cause of action for Quiet Title and Cancellation of Instruments because the allegations are demonstrably false. Plaintiff’s claim that the title chain is void ab initio because Park Place Finance, LLC purported to assign an interest originally held by Park Place Finance, Inc. without a valid recorded chain bridging the entities is proven false by the record. The Assignment was executed by and on behalf of Park Place Finance, Inc., not Park Place Finance, LLC.

Plaintiff asserts that the Assignment’s notary language identifies Justin Hubbert as “Managing Member of Park Place Finance, LLC, a Texas Limited Liability Company” and the dispute regarding the unreconciled Park Place Finance, Inc./Park Place Finance, LLC dispute supports probable validity of his claims. Code of Civil Procedure § 1207 provides: Any instrument affecting the title to real property, 90 days after the same has been copied into the proper book of record, kept in the office of any county recorder, imparts notice of its contents to subsequent purchasers and encumbrancers, notwithstanding any defect, omission, or informality in the execution of the instrument, or in the certificate of acknowledgment thereof, or the absence of any such certificate; but nothing herein affects the rights of purchasers or encumbrancers previous to the taking effect of this act.

Duly certified copies of the record of any such instrument may be read in evidence with like effect as copies of an instrument duly acknowledged and recorded; provided, when such copying in the proper book of record occurred within five years prior to the trial of the action, it is first shown that the original instrument was genuine. Code of Civil Procedure § 1189 makes clear that a certificate of acknowledgement verifies only the identity of the individual who signed the document to which the certificate is attached, not the truthfulness, accuracy, or validity of that document.

Plaintiff’s causes of action rest entirely on the theory that the assignment and resulting chain are void abinitio because the notary section named Park Place Finance, LLC as the transferring party. This error in the notary section alone does not invalidate the otherwise valid assignment from Park Place Finance, Inc. to Pacific Life Insurance Company.

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Defendants argue that Plaintiff cannot prove the DOT was satisfied and paid in full. Plaintiff argues that tender cannot be used as a forfeiture device when the entities demanding payment do not identify one stable amount or reconcile the default interest, late charges, fees, pending costs, and principal components that produced the moving demand. Plaintiff further asserts that tender exceptions apply, wherein he invokes each applicable exception. Tender is required where the assignment is void, not merely voidable.

Sciarratta v. U.S. Bank National Assn. (2016) 247 Cal.App.4th 552, 568 [202 Cal.Rptr.3d 219, 232]. There are four exceptions to the tender requirement: First, if the borrower's action attacks the validity of the underlying debt, a tender is not required since it would constitute an affirmation of the debt...Second, a tender will not be required when the person who seeks to set aside the trustee's sale has a counterclaim or setoff against the beneficiary. In such cases, it is deemed that the tender and the counterclaim offset one another, and if the offset is equal to or greater than the amount due, a tender is not required...Third, a tender may not be required where it would be inequitable to impose such a condition on the party challenging the sale...Fourth, no tender will be required when the trustor is not required to rely on equity to attack the deed because the trustee's deed is void on its face.

Lona v. Citibank, N.A. (2011) 202 Cal.App.4th 89, 112–113 [134 Cal.Rptr.3d 622, 640–641] As Plaintiff has not demonstrated that the assignment was void, the tender exception based on void assignment does not apply. The Court does not find any of the other exceptions are applicable. Additionally, Plaintiff’s argument that tender cannot be used as a forfeiture device without one stable amount does not substitute for a showing of probable validity on the merits of the underlying claim. The Court finds that Plaintiff has not established by a preponderance of the evidence the probable validity of his cause of action for Quiet Title and Cancellation of Instruments.

4. Slander of Title Defendants assert that none of the documents related to the construction loan contained a false statement, as the Assignment properly assigned the interest of Park Place Finance, Inc. to Pacific Life Insurance Company. Plaintiff’s challenge to the Notice of Default relates to Ms. Mallory’s signature on the attached Declaration, which she executed as an employee of BSI Financial Services, Mortgage Service. Plaintiff plead that BSI is the servicer of the loan, so there are no grounds to find her attestation was false. Additionally, the recording of the documents was privileged and cannot base liability for slander of title. Plaintiff argues that the recorded documents were not privileged, and the evidence supports the inference that Defendants lacked a reasonable basis to treat the recorded amount and

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authority chain as settled. The privilege therefore does not justify expungement before adjudication of malice. To state a claim for slander of title, a plaintiff must allege “(1) a publication, (2) which is without privilege or justification,” (3) which is false, and (4) which “causes direct and immediate pecuniary loss.” (Manhattan Loft, LLC v. Mercury Liquors, Inc. (2009) 173 Cal.App.4th 1040, 1050-1051, 93 Cal.Rptr.3d 457; La Jolla Group II v. Bruce (2012) 211 Cal.App.4th 461, 472, 149 Cal.Rptr.3d 716.)

Schep v. Capital One, N.A. (2017) 12 Cal.App.5th 1331, 1336 [220 Cal.Rptr.3d 408, 411], as modified on denial of reh'g (July 18, 2017). Code of Civil Procedure § 47(b) provides that a privileged publication is one made in any legislative proceeding, judicial proceeding, or in any other official proceeding authorized by law. Code of Civil Procedure § 47 creates two privileges: (1) an absolute privilege, commonly called the litigation privilege, that applies irrespective of the speaker's motive (§ 47, subd. (b)); and (2) a qualified privilege that “applies only to communications made without malice.”

Schep v. Capital One, N.A. (2017) 12 Cal.App.5th at 1337. For the purposes of section 47 ’s qualified privilege, “malice” means that the defendant (1) “ ‘was motivated by hatred or ill will towards the plaintiff,’ ” or (2) “ ‘lacked reasonable grounds for [its] belief in the truth of the publication and therefore acted in reckless disregard of the plaintiff's rights.’ Id. Upon review of the published documents at issue, the Court does not find that the documents were false. Additionally, the recording of these documents was privileged.

The Court finds that Plaintiff has not established by a preponderance of the evidence the probable validity of his cause of action for Slander of Title. ATTORNEY’S FEES Defendants request attorney’s fees and costs in the amount of $2,940.00 pursuant to Code of Civil Procedure § 405.38, which provides: The court shall direct that the party prevailing on any motion under this chapter be awarded the reasonable attorney's fees and costs of making or opposing the motion unless the court finds that the other party acted with substantial justification or that other circumstances make the imposition of attorney's fees and costs unjust.

Plaintiff argues that attorney’s fees should not be awarded because he acted with substantial justification, as the recorded individual deed, executed personal Guaranty, materially inconsistent authority disclosures, moving payoff demands, open servicing review, court-default records, construction-draw directives, and CSLB history form a serious and documented title dispute. The Court does not find that Plaintiff acted with substantial justification. Defendants’ request for attorney’s fees is granted.

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TENTATIVE RULING #5: DEFENDANTS’ MOTION FOR EXPUNGEMENT OF LIS PENDENS AND ATTORNEY’S FEES IS GRANTED. NO HEARING ON THIS MATTER WILL BE HELD UNLESS A REQUEST FOR ORAL ARGUMENT IS TRANSMITTED ELECTRONICALLY THROUGH THE COURT’S WEBSITE OR BY TELEPHONE TO THE COURT AT (530) 621-6551 BY 4:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED. CAL. RULE CT. 3.1308; LOCAL RULE 8.05.07; SEE ALSO LEWIS V. SUPERIOR COURT, 19 CAL.4TH 1232, 1247 (1999). NOTICE TO ALL PARTIES OF A REQUEST FOR ORAL ARGUMENT AND THE GROUNDS UPON WHICH ARGUMENT IS BEING REQUESTED MUST BE MADE BY TELEPHONE OR IN PERSON BY 4:00 P.M.

ON THE DAY THE TENTATIVE RULING IS ISSUED. CAL. RULE CT. 3.1308; EL DORADO COUNTY LOCAL RULE 8.05.07. PROOF OF SERVICE OF SAID NOTICE MUST BE FILED PRIOR TO OR AT THE HEARING. LONG CAUSE HEARINGS MUST BE REQUESTED BY 4:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED AND THE PARTIES ARE TO PROVIDE THE COURT WITH THREE MUTUALLY AGREEABLE DATES ON FRIDAY AFTERNOONS AT 2:30 P.M. LONG CAUSE ORAL ARGUMENT REQUESTS WILL BE SET FOR HEARING ON ONE OF THE THREE MUTUALLY AGREEABLE DATES ON FRIDAY AFTERNOONS AT 2:30 P.M.

THE COURT WILL ADVISE THE PARTIES OF THE LONG CAUSE HEARING DATE AND TIME BY 5:00 P.M. ON THE DAY THE TENTATIVE RULING IS ISSUED. PARTIES MAY PERSONALLY APPEAR AT THE HEARING.

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