GREGORY SCOTT MCALLISTER VS R. SCOTT KINCAID

1. CASE # CASE NAME HEARING NAME GREGORY SCOTT MCALLISTER, AN INDIVIDUAL VS R. SCOTT KINCAID, INDIVIDUALLY AND AS MOTION FOR RELIEF FROM CVPS2200362 CO-TRUSTEES OF THE KINCAID JUDGMENT FAMILY TRUST CREATED BY DECLARATION OF TRUST DATED AUGUST 5, 2005 Tentative Ruling: The Kincaids seek a modification of the Interlocutory Judgment requiring them to remove all encroachments from the McAllister Property pursuant to Civ. Code § 3424 on the grounds that there has been a change in circumstances and the interests of justice would be served by modification.

They ask the Court to find it is financially impossible for the Kincaids to comply with the Interlocutory Judgment; dissolve the injunction requiring removal; permit the encroachments on the McAllister Property to remain; and to enter a monetary judgment in the amount of $1,356,488. (See, Proposed Order.) Civ. Code § 3424(a) states: “Upon notice and motion, the court may modify or dissolve a final injunction upon a showing that there has been a material change in the facts upon which the injunction was granted, that the law upon which the injunction was granted has changed, or that the ends of justice would be served by the modification or dissolution of the injunction.”

The party moving for modification or termination of an injunction has the burden of showing by a preponderance of the evidence that one of the specified circumstances is present and justifies modification or termination. (See, Loeffler v Medina (2009) 174 Cal.App.4th 1495, 1504; United Food & Commercial Workers Union v Superior Court (2000) 83 Cal.App.4th 566, 575-576.) Here, the Kincaids present the following evidence to establish that circumstances have changed because it is financially impossible for them to comply with the Interlocutory Judgment: • The cost of removing the encroachments as required by the Interlocutory Judgment is between $502,500 and $1,375,000 (Kincaid Decl. at ¶ 14); • Kincaid Industries is the sole source of income for the Kincaids, and it ceased doing business in February 2026 due to its earnings deficit and significant liabilities, including business loans of $2,200,000 and $950,000 (Kincaid Decl. at ¶¶ 17-22); • Kincaid Industries defaulted on both loans, which are personally guaranteed by Scott and the Kincaid Trust (Kincaid Decl. at ¶ 21; Bastian Decl. at ¶ 4); • Their basic living expenses and obligations exceed their incoming revenue (Kincaid Decl. at ¶ 24); • They currently have credit card debt of $72,200 and $23,000 in their personal banking accounts (Kincaid Decl. at ¶ 25); • They personally owe $1,358,300.23 to the IRS for a tax lien that Kincaid Industries cannot pay (Kincaid Decl. at ¶ 26); • There are four secured lenders on the Kincaid Property, for two loans on the Kincaid Property of $1.4 million each; a business loan to Kincaid Industries of $3.5 million; and for attorney's fees and costs totaling $679,000 (Kincaid Decl. at ¶ 28); and

• The Kincaids retained an attorney who has reviewed their finances and deemed them insolvent (Bastian Decl. at ¶¶ 2, 6). While this evidence demonstrates that the Kincaids clearly have financial difficulties, it is insufficient to establish changed circumstances based on financial impossibility to comply with the Interlocutory Judgment for the following reasons. The Kincaids contend that the property located at 31065 Plantation Drive, Thousand Palms, California, which is worth $3 million, is an asset of Kincaid Industries. (Kincaid Decl. at ¶ 17, Motion, p. 10, Table, line 3.)

However, the document provided by Scott Kincaid to show the value of this property shows that the Kincaid Trust is the owner/seller of the property. (Kincaid Decl., Ex. 8.) If it is owned by Kincaid Trust and not Kincaid Industries, this is an additional $3 million that the Kincaids have access to. While the IRS did send a letter to Scott proposing a Trust Fund Recovery Penalty assessment of $1,358,300.23 based on Kincaid Industries’ unpaid taxes, the letter gives the Kincaids the option of accepting the proposal, negotiating it, or appealing it. (See, Kincaid Decl. at ¶ 26, Ex. 13.)

There is no information regarding whether the Kincaids agreed to pay this amount, or instead negotiated a lesser payment. If a lesser amount was negotiated, this frees up additional money to the Kincaids. There is evidence that the Kincaids at least partially own two new companies, H2O Services and Legacy, but the Kincaids completely ignore this in their papers. Without knowing what interest they have in these businesses, and what if any income is derived therefrom, the Court does not have a true picture of the Kincaids’ finances.

Regarding the two loans on the Kincaid Property, $1.4 million secured by Franklin Loan Center and $1.4 million secured by Forge Trust, the deeds of trust were recorded on September 28, 2020 and July 28, 2022, six and four years ago respectively. (Kincaid Decl. at ¶¶ 28(1), (2); Exs. 14, 15.) The Kincaids imply that the entire amount of both loans is still owing. However, there is no evidence of what payments have been made on the loans in the past 4-6 years, or how much is actually still owed. Without that information, it is impossible to tell what the Kincaids true liabilities are.

Further, while the personal tax documents provided show, as Scott states, that his and Kaci’s California personal adjusted gross income was -$127,464, the documents also show Federal wages of $369,302, and a Federal adjusted gross income of $117,512. (Kincaid Decl. at ¶ 23, Ex. 12.) Without information about the wages, deductions claimed, etc., it is impossible to determine the Kincaids’ actual income. Additionally, while the Kincaids contend that they cannot sell their house to obtain the money to pay to remove the encroachments required by the Interlocutory Judgment because it cannot be sold for market value while the injunction is in place, there is no admissible evidence to support this claim.

As the Kincaids argue in their motion that if they could sell their house, they could pay a monetary judgment of over $1.3 million to the McAllisters, the failure to establish that they cannot currently sell their house alone defeats their financial impossibility argument. Finally, there is no evidence that the Kincaids made any attempts to obtain funding to pay for the removal of encroachments, or that such attempts were unsuccessful. Given that the Kincaids themselves estimate that the cost complying with the Interlocutory Judgment could be as low as $502,500 [Kincaid Decl. at ¶ 14], and there are many questions about the Kincaids income and liabilities, there is insufficient evidence to establish a change of circumstances based on financial impossibility.

The evidence also does not show that modification of the Interlocutory Judgment is in the interests of justice.

Defendants’ Request for Judicial Notice Exhibits 1 and 2 GRANTED.

Plaintiffs’ Request for Judicial Notice Exhibits 1-10 GRANTED.

Plaintiffs Evidentiary Objections 1, 2, 9 and 10 OVERRULED.

Plaintiffs Evidentiary Objections 3-8 SUSTAINED.

Defendants’ Motion to Modify Interlocutory Judgment is DENIED.

Status Conference re Removal Plan is set for 12.03.26. Parties are to file a joint status report no later than 5 court days prior to the status conference.

Plaintiffs’ Proposed Order filed 7.30.26 detailing the implementation of the Removal Plan shall be signed by the court.

2. CASE # CASE NAME HEARING NAME NIETO VS CREATING A MOTION TO BE RELIEVED AS CVPS2404518 LEGACY, INC., A COUNSEL FOR JESSE GARCIA CALIFORNIA Tentative Ruling: Hearing vacated.

Motion to be Relieved as Counsel for Jesse Garcia GRANTED.

Attorneys John Haubrich Jr. and Kandice Canchan are relieved as attorneys for Defendant Jesse Garcia upon filing the proof of service of the signed court order upon the Defendant.

3. CASE # CASE NAME HEARING NAME RESPONSE INDEMNITY COMPANY OF DEMURRER ON COMPLAINT OF CALIFORNIA, A RESPONSE INDEMNITY COMPANY OF CVPS2602348 CALIFORNIA CALIFORNIA, A CALIFORNIA CORPORATION VS CORPORATION AMTRUST NORTH AMERICA Tentative Ruling: To withstand a demurrer the complaint must contain “a statement of the facts constituting the cause of action, in ordinary and concise language.” (C.C.P. § 425.10.) “[T]he complaint need only allege facts sufficient to state a cause of action, each evidentiary fact that might eventually form part of the plaintiff’s proof need not be alleged. (C.A. v.

William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872.) Generally a plaintiff need only plead facts necessary “to acquaint a defendant with the nature, source and extent of his claims.” (Doe v. City of Los Angeles (2007) 42 Cal.4th 531, 549-550.) On demurrer the court must assume the truth of all facts properly pled, facts that may be implied or reasonably inferred from the facts expressly alleged, and evidentiary facts that are in exhibits attached to the complaint. (Evans v. City of Berkeley (2006) 38 Cal.4th 1,