In the Matter of Total Lender Solutions, Inc.

change the outcome of this Motion. Further, the Court notes that this hearing was continued, on the Court's own motion, from May 21, 2026 to today's date. (5/21/26 Minute Order.) No supplemental declaration has been filed regarding the status of the PMQ deposition, and no ex parte application to continue the Motion has been filed.

Conclusion

Based on the foregoing, Defendant's Motion for Summary Judgment is granted.

Solutions, Inc.'s Motion for Order Depositing Surplus Proceeds; Setting Hearing on Distribution of Surplus Proceeds From the Sale; Awarding Fees and Costs; and, Discharge of Petitioner is DENIED. Petitioner to give notice.

Background

On February 27, 2026, Petitioner Total Lender Solutions, Inc. ("Petitioner") filed this Petition and Declaration regarding unresolved claims and deposit of undistributed surplus proceeds of trustee's sale with respect to real property located at 14561 Leffingwell Road, Whittier Area, California 90604 ("Property"). The trustee sale occurred on February 27, 2025. On March 24, 2025, Petitioner provided written notice of the available surplus funds generated from the foreclosure sale. Petitioner sent an additional notice on April 24, 2025.

Petitioner received three claims from 1) California Department of Tax and Fee Administration, 2) the Franchise Tax Board, and 3) Expedition Industries Inc. On March 9, 2026, Petitioner filed the instant Motion for an order depositing surplus proceeds from the sale and discharging Petitioner, setting a hearing on distribution of surplus proceeds, and directing the clerk to discharge Petitioner upon deposit of the surplus proceeds. Petitioner makes this motion pursuant to Civil Code section 2924j.

Petitioner further requests an award of attorney's fees and costs pursuant to Civil Code section 2924k, subdivision (a)(1) and (b). Legal Standard "[W]ithin thirty days of the of the execution of the trustee's deed resulting from a sale in which there are proceeds remaining after payment of the amounts required by paragraphs (1) and (2) of subdivision (a) of Section 2924k," the trustee must send written notice to individuals who had a recorded interest in the real property prior to the trustee's sale. (Civ.

Code, Sec. 2924j, subd. (a).) This allows those individuals to "contact the trustee at the address provided in the notice to pursue any potential claim" to the surplus funds. (Civ. Code, Sec. 2924j, subd. (a)(3).) Claimants have 30 days to make a claim. (Civ. Code, Sec.¿2924j, subd. (a)(4).) Once claims are received, the trustee must "exercise due diligence to determine the priority of the written claims." (Civ. Code, Sec. 2924j, subd. (b).) If "there is no dispute as to the priority of the written claims submitted to the trustee, proceeds shall be paid within 30 days after the conclusion of the notice period.

If the trustee has failed to determine the priority of written claims within 90 days following

the 30-day notice period, then within 10 days thereafter the trustee shall deposit the funds with the clerk of the court pursuant to subdivision (c)." (Ibid.) Civil Code section 2924j, subdivision (c) provides the following: "If, after due diligence, the trustee is unable to determine the priority of the written claims received by the trustee to the trustee's sale surplus of multiple persons or if the trustee determines there is a conflict between potential claimants, the trustee may file a declaration of the unresolved claims and deposit with the clerk of the superior court of the county in which the sale occurred, that portion of the sales proceeds that cannot be distributed, less any fees charged by the clerk pursuant to this subdivision.

The declaration shall specify the date of the trustee's sale, a description of the property, the names and addresses of all persons sent notice pursuant to subdivision (a), a statement that the trustee exercised due diligence pursuant to subdivision (b), that the trustee provided written notice as required by subdivisions (a) and (d),¿and the amount of the sales proceeds deposited by the trustee with the court. Further, the trustee shall submit a copy of the trustee's sales guarantee and any information relevant to the identity, location, and priority of the potential claimants with the court and shall file proof of service of the notice required by subdivision (d) on all persons described in subdivision (a)." (Civ.

Code, Sec. 2924j, subd. (c).) Thereafter, "[t]he clerk shall deposit the amount with the county treasurer or, if a bank account has been established for moneys held in trust under paragraph (2) of subdivision (a) of Section 77009 of the Government Code, in that account, subject to order of the court upon the application of any interested party. The clerk may charge a reasonable fee for the performance of activities pursuant to this subdivision equal to the fee for filing an interpleader action pursuant to Chapter 5.8 (commencing with Section 70600) of Title 8 of the Government Code.

Upon deposit of that portion of the sale proceeds that cannot be distributed by due diligence, the trustee shall be discharged of further responsibility for the disbursement of sale proceeds. A deposit with the clerk of the court pursuant to this subdivision may be either for the total proceeds of the trustee's sale, less any fees charged by the clerk, if a conflict or conflicts exist with respect to the total proceeds, or that portion that cannot be distributed after due diligence, less any fees charged by the clerk." (Civ.

Code, Sec. 2924j, subd. (c).) "Within 90 days after deposit with the clerk, the court shall consider all claims filed at least 15 days before the date on which the hearing is scheduled by the court, the clerk shall serve written notice of the hearing by first-class mail on all claimants identified in the trustee's declaration at the addresses specified therein." (Civ. Code, Sec. 2924j, subd. (d).)

Discussion

The trustee sale of the Property, which occurred on February 27, 2025, resulted in surplus funds in the total amount of $443,309.24 (Wilkinson Decl., P. 3; Pet., P. 7.) On March 24, 2025, Petitioner provided written notice of available surplus funds to all

persons/entities with a recorded interest in the Property. (Wilkinson Decl., P. 4, Exh. 1.) When Petitioner received no responses, Petitioner served an additional notice on April 24, 2025. (Ibid.) Petitioner received the following three claims: 1) claim in the amount of $1,938,345.08 from the California Department of Tax and Fee Administration (hereinafter "CDTFA"), 2) claim in the amount of $5,431.41 from the Franchise Tax Board (hereinafter, "FTB"), and 3) claim for the entirety of the surplus proceeds from the former trustor, Expedition Industries Inc. (hereinafter, "Expedition Industries"). (Wilkinson Decl., P. 5.)

On December 4, 2025, SLG issued the proposed Distribution Schedule based on the lienholder order of priority. The CDTFA is the first lienholder in the chain of title, based on the Notice of State Tax Lien, recorded on December 15, 2020 ("1 st Tax Lien"). (Wilkinson Decl., P. 7; Pet., Attachs. 11a-12.) The FTB is the second lienholder in the chain of title, based on the Notice of State Tax Lien, recorded on February 20, 2024 ("2 nd Tax Lien"). (Ibid.) The CDTFA is the third lienholder in the chain of title based on the Notice of State Tax Lien, recorded on December 5, 2024 ("3 rd Tax Lien"). (Ibid.)

In the event any surplus funds remain after the lienholders have been paid, the former trustor--here, Expedition Industries--would then be paid. (Ibid.) The proposed Distribution Schedule is summarized by Petitioner as follows: - Distribution of surplus to the CDTFA on the 1 st Tax Lien, in amount of $439,346.82; - No distribution to the FTB on the 2 nd Tax Lien, as surplus funds have been exhausted; - No distribution to the CDTFA on the 3 rd Tax Lien, as surplus funds have been exhausted; - No distribution to the Former Trustor (Expedition Industries) as surplus funds have been exhausted. (Ibid.)

On December 15, 2025, Petitioner's counsel received a Letter of Opposition to the proposed Distribution Schedule ("Opposition") from Omid Shirazi, Counsel for Expedition Industries. (Wilkinson Decl., P. 8, Exh. 4.) The Opposition stated that Expedition Industries opposed the proposed distribution to the CDTFA, including the disbursement of $439,346.82 on the 1st Tax Lien, on grounds that CDTFA should not have assessed taxes on the Expedition Industries (as the former trustor). (Ibid.) In January 2026, chain of email exchanges between Petitioner's counsel and Expedition Industries' counsel revealed that the Opposition was based on a complaint filed by Expedition Industries against CDTFA in the Los Angeles Superior Court that was dismissed ("Litigation Action"). (Wilkinson Decl., P. 9, Exh. 5.)

Around the same time, CDTFA sent an email to Petitioner's counsel stating that and received a copy of the Opposition and providing a copy of the Register of Actions from the Litigation Action, originally filed on May 3, 2022. (Wilkinson Decl., P. 10, Exh. 6.)

Petitioner's counsel informed the CDFTA that as a result of the conflict, Petitioner would be interpleading the funds with the Court. (Ibid.) On January 26, 2026, CDFTA's counsel sent a letter to Petitioner's counsel that the Court sustained the CDFTA's Demurrer to the Expedition Industries' First Amended Complaint in the Litigation Action, and that on these grounds the Litigation Action was dismissed with prejudice. (Wilkinson Decl., P. 11, Exh. 7.) The letter also stated that the California Court of Appeal dismissed Expedition Industries' appeal of the trial court's judgment after sustaining the CDFTA's Demurrer. (Ibi d.)

On January 28, 2026, Petitioner's counsel sent an email to Expedition Industries' counsel and CDFTA's counsel in an attempt to resolve their conflicting positions, but no response was received. (Wilkinson Decl., P. 12, Exh. 8.) Thus, Petitioner argues that, after due diligence, Petitioner has determined that there is a conflict between the potential claimants to the surplus proceeds. (Wilkinson Decl., P. 13, Exh. 9.) Petitioner thus filed the instant Petition for authorization to deposit the surplus funds with the Court.

The Court notes the following developments occurred after the instant Motion was filed: On March 27, 2026, CDTFA filed a Notice of Claim and Claim to Surplus Funds pursuant to Civil Code section 2924j, subdivision (d) [regarding its claim for funds to be considered after the surplus funds are deposited with the clerk]. On July 27, 2026, Expedition Industries filed a Notice of Withdrawal of Claim to Surplus Funds. The Court finds that Expedition Industries' Notice of Withdrawal renders the issues in this Motion moot.

In other words, there is longer a conflict of priorities between CDTFA and Expedition Industries' claims. There is no other indication that Petitioner would not be able to determine the priority of written claims received. Accordingly, Petitioner's Motion for Order Depositing Surplus Proceeds; Setting Hearing on Distribution of Surplus Proceeds From the Sale; Awarding Fees and Costs; and, Discharge of Petitioner is DENIED. | Home -->)" -->