Mares v. Lien Enforcement CA4/1 (2016) · DecisionDepot
Mares v. Lien Enforcement CA4/1
California Court of Appeal Sep 30, 2016 No. D068426Unpublished
Filed 9/30/16 Mares v. Lien Enforcement CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
EDWARD D. MARES, D068426
Plaintiff and appellant,
v. (Super. Ct. No. 37-2014-00001733-CU-BT-CTL) LIEN ENFORCEMENT, INC. et al.,
Defendants and respondents.
APPEAL from judgments of the Superior Court of San Diego County, Joel M.
Pressman, Judge. Affirmed.
Glassey Smith and Sharon Elizabeth Glassey, Christopher Thomas Smith, Joshua
Charles Anaya, for Plaintiff and Appellant.
Carlson & Messer and Jeanne Louise Zimmer, June Grace Felipe, for Defendant
and Respondent Lien Enforcement, Inc.
Thomas Lucas and Timothy D. Lucas, A. Kerry Stack, for Defendant and
Respondent Atlas Towing Services, Inc., doing business as Advanced Towing.
Plaintiff and appellant Edward D. Mares sued defendants and respondents Lien
Enforcement, Inc. (LEI) and Atlas Towing Services, Inc., doing business as Advanced
Towing (Advanced) for negligence, defamation, violation of the Unfair Competition Law
(UCL; Bus. & Prof. Code, § 17200 et seq.) and declaratory relief after LEI, a debt
collector, pursued Mares to collect towing and storage debt for a vehicle that Mares
claimed to have previously sold to a third party. On the parties' cross-motions for
summary judgment/summary adjudication, the trial court denied Mares's motion for
summary adjudication and entered summary judgments in LEI's and Advanced's favor,
ruling in part that Department of Motor Vehicles (DMV) registration information
reflected that Mares was the registered owner of the vehicle, that LEI and Advanced
reasonably relied on this information in directing collection efforts on Mares, and that
Mares had not complied with the notice requirements of Vehicle Code1 section 5900 for
the vehicle's sale and transfer so as to absolve him of liability for the "parking,
abandoning, or operation" of the vehicle.
Mares appeals from the summary judgments. He contends that (1) the trial court
erred by denying summary adjudication of his declaratory relief cause of action because
he presented admissible evidence he complied with section 5602, subdivision (a), under
which a person entering into a bona fide sale of a vehicle will not be considered an
"owner . . . so as to be subject to civil liability for the . . . [vehicle's] abandoning"; (2) the
court erred by ruling that Advanced's statutory and general duties of due care, and LEI's
1 Statutory references are to the Vehicle Code unless otherwise indicated. 2
general duty of due care, was limited to determining the identity of the vehicle's
registered owner; (3) he demonstrated a triable issue of material fact as to whether
Advanced and LEI reasonably investigated the registered owner's liability; (4) the court
erred by granting summary judgment on his defamation claim because defendants
provided false information to credit reporting agencies, and the Fair Credit Reporting Act
(FCRA) did not preempt his claim; and (5) he presented triable issues of material fact as
to whether Advanced and LEI committed unlawful, unfair or fraudulent acts.
We conclude the trial court did not err by denying Mares's motion for summary
adjudication and by granting summary judgment in Advanced and LEI's favor. In part,
we hold Mares did not show as a matter of law he was entitled to a judicial determination
of nonliability under section 5602, subdivision (a), because the reference in that section
to "civil liability for . . . abandoning" does not refer to responsibility for a lienholder's
deficiency claim for towing and storage fees following a lien sale. We also hold
summary judgment on Mares's negligence claims was proper based on undisputed
evidence that Advanced and LEI determined that Mares was the registered owner of
record at the time the vehicle was towed. For these and other reasons set forth below, we
affirm.
FACTUAL AND PROCEDURAL BACKGROUND
In or around February 2012, Mares advertised a Jeep (the vehicle) for sale, and in
response was contacted by a third party. The vehicle was registered in Mares's name at
his grandparents' address. Mares met the buyer on the street, gave him the signed vehicle
certificate of ownership (colloquially, the "pink slip"; Springmeyer v. Ford Motor Co.
3
(1998) 60 Cal.App.4th 1541, 1569), and accepted $1,000 in cash. As Mares began filling
out the notice of release of liability that he had detached from the certificate of
ownership, the buyer drove away with the vehicle.
On March 1, 2012, Mares visited the Department of Motor Vehicles (DMV) and
filled out a DMV form "Notice of Transfer and Release of Liability" (Reg. 138) (the
notice of transfer).2 He entered "Unknown" for the buyer's name and address. The
DMV accepted the form.
In September 2012, in response to a call from the California Highway Patrol
(CHP), Advanced towed and impounded the vehicle, which was found abandoned on a
highway. Advanced relied on a CHP vehicle report showing that Mares was still the
vehicle's registered owner. Advanced retained a lien service company to obtain DMV
certified information regarding the vehicle and to act as its agent in performing activities
relating to the lien sale. Advanced's lien servicer confirmed that Mares was the vehicle's
registered owner and notified Mares of the pending lien sale. Specifically, on October 9,
2012, it sent a "notice of pending lien sale for vehicle valued at $4000 or less" and
"notice of stored vehicle/amnesty offer" to Mares's grandfather's address on record,
advising Mares that Advanced intended to sell the vehicle at a lien sale, and as the
registered owner he was liable for the total towing, storage and lien processing charges
2 The top of the notice of transfer reads in part: "To ensure your liability is released, please follow instructions below. The form must be completed in full." (Capitalization omitted.) It also contains a provision reading: "WARNING! You must provide accurate, legible information: vehicle vessel description, your name/address, buyer's name/address, and the date of sale or lease return, or the information SHALL NOT be updated or retained!" 4
and fee, less the amount received from the sale. Mares's father received the amnesty
offer and told Advanced that the vehicle had been sold and that a notice of transfer had
been filed with the DMV. Following its impound, the vehicle was left unclaimed at
Advanced's facility, declared abandoned, and disposed of pursuant to storage lien
limitations. Advanced sold the vehicle for $200.
Because the lien sale proceeds did not satisfy the towing and storage fees, the
deficiency was placed with LEI for collections. Advanced informed LEI that Mares was
the vehicle's registered owner of record at the time of the tow, and according to the
documents provided by Advanced, LEI also determined that Mares was the registered
owner of the vehicle responsible for the debt. At some point, Mares contacted LEI and
sent it DMV documents showing a notice of transfer had been filed, but LEI informed
him it had verified the debt's legitimacy and would continue to collect it. LEI reported
the debt to credit reporting bureaus.
Mares sued LEI and Advanced, and eventually filed a first amended complaint
setting out causes of action for negligence, defamation as to LEI, violation of the UCL
and declaratory relief. Mares alleged LEI and Advanced failed to use reasonable care in
ascertaining whether he (1) was responsible for the claimed debt; (2) had complied with
section 5602, subdivision (a) which requires proper endorsement and delivery of the
vehicle's title; (3) was absolved of liability by his filing of the notice of transfer; and (4)
made a bona fide sale of his vehicle, delivered possession of the vehicle as well as a
properly endorsed certificate of ownership to the buyer, and filled out and properly filed
the notice of transfer. Mares also alleged that LEI failed to use reasonable care in
5
verifying whether it could legally collect the debt. In his cause of action for defamation,
Mares alleged in part that LEI made false statements to credit reporting agencies that
Mares had failed to pay a debt, causing those agencies to understand he was a higher
credit risk. Many of these allegations were the basis for his UCL cause of action. Mares
sought a judicial declaration as to his rights and duties with regard to the vehicle and
specifically on his contention that he was not "subject to civil or criminal liability for the
parking, abandonment, or operation of the vehicle."
Mares moved for summary adjudication of his negligence and defamation causes
of action. In part, he argued he had extinguished any presumptive liability for the debt by
complying with sections 5602, subdivision (a) and 5900. Mares pointed out he presented
evidence—including via his sworn declaration describing how he had signed and dated
the certificate of ownership3—that he entered into a bona fide sale, delivered possession
of the vehicle, and endorsed and delivered the certificate of ownership to the buyer; that
the buyer's name on the title was not required. Mares argued that though Advanced had
obtained registration information revealing that Mares had sold the vehicle, it made no
independent investigation, ignored information provided by Mares, and continued to
attempt to collect the debt, and Advanced had a statutory duty of care under Vehicle
3 Specifically, Mares averred in paragraph No. 4 of his supporting declaration: "I signed and dated the Jeep vehicle certificate of ownership in two places. First, I signed and dated Line 1a, which is directly below the statement 'I certify under penalty of perjury under the laws of the State of California that THE SIGNATURE(S) BELOW RELEASES INTEREST IN THE VEHICLE.' Second, I filled out the odometer reading in the box on the front of the title, wrote the date in the box labeled 'DATE,' and signed in the box labeled 'TRANSFEROR/SELLER SIGNATURE(S).[']" 6
Code section 10652.5 and Civil Code section 3068.2, and it and LEI had general duties of
care, to investigate whether Mares was the registered owner and liable for the debt. He
asked the court to issue a judicial declaration that he was not liable to LEI or Advanced
for the debt and to adjudicate that Advanced and LEI had duties to investigate whether he
was liable for the towing and storage fees both before collecting them and after he
disputed his liability.
LEI thereafter moved for summary judgment and alternatively summary
adjudication of issues. It argued Mares's negligence claim failed because its collection
efforts against Mares, the vehicle's registered owner according to DMV records, were
reasonable; the FCRA (15 U.S.C. § 1681 et seq.) barred Mares's claim for defamation;
and Mares's UCL and declaratory relief claims failed for lack of a viable underlying
claim or controversy. Advanced joined in LEI's motion.
The court granted Advanced's motion for joinder, denied Mares's motion for
summary adjudication of issues, and granted LEI's motion for summary judgment. In
part, it sustained LEI's objections to Mares's declaration describing how he had signed
and dated the vehicle's certificate of ownership. As for Mares's negligence cause of
action, it ruled Advanced reasonably relied on information that Mares was the registered
owner of the vehicle on the date it was towed, gave LEI documentation including a notice
of pending lien sale identifying Mares as the registered owner, and informed LEI that
Mares was responsible for the debt. It ruled that LEI had no obligation to look beyond
the DMV's registration records to ascertain the vehicle's owner and that both Advanced
and LEI acted reasonably by relying on the DMV registration information as well as the
7
CHP vehicle report in directing collection efforts on Mares. It rejected Mares's argument
that he had complied with section 5602, ruling that even if the section were applicable,
Mares had failed to comply with the requirement of section 5900 that he notify the DMV
of the purchaser's name and address. With respect to Mares's claim for defamation
against LEI, it ruled the information provided by LEI was not false, but even if it was,
Mares had no private right of action against it for reporting to credit reporting agencies
and that the alleged conduct fell under the FCRA, which preempted the claim. The court
ruled that Mares's causes of action under the UCL and for declaratory relief lacked merit
given the absence of a violation of law, negligence or defamation liability.
Mares appeals from the ensuing judgments in LEI's and Advanced's favor.
DISCUSSION
I. Standard of Review
Summary judgment is properly granted "if all the papers submitted show that there
is no triable issue as to any material fact and that the moving party is entitled to a
judgment as a matter of law." (Code Civ. Proc., § 437c, subd. (c).) Summary
adjudication is appropriate only if there is no triable issue of material fact as to one or
more causes of action within an action, one or more affirmative defenses, one or more
claims for damages, or one or more issues of duty. (Code Civ. Proc., § 437c, subd.
(f)(1).)
Where, as here, a plaintiff moves for summary adjudication of a cause of action,
the court shall grant the motion "only if it completely disposes" of the cause of action.
(Code Civ. Proc., § 437c, subd. (f)(1).) The plaintiff bears the initial burden of showing
8
there is no defense to a cause of action by proving each of its elements. (Oldcastle
Precast, Inc. v. Lumbermens Mutual Casualty Co. (2009) 170 Cal.App.4th 554, 564-565;
see Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 853.) "If the plaintiff does
not make this showing, ' "it is unnecessary to examine the [defendant's] opposing
evidence and the motion must be denied." ' [Citation.] ' "However, if the moving papers
establish a prima facie showing that justifies a [ruling] in the [plaintiff's] favor, the
burden then shifts to the [defendant] to make a prima facie showing of the existence of a
triable material factual issue." ' " (See's Candy Shops, Inc. v. Superior Court (2012) 210
Cal.App.4th 889, 900; Oldcastle, at p. 564.) To satisfy this burden, the opposing party
must present admissible evidence and may not rely upon the allegations or denials of its
pleading. (Aguilar, 25 Cal.4th at p. 849.)
"A defendant moving for summary judgment or summary adjudication must show
that one or more elements of the plaintiff's cause of action cannot be established or that
there is a complete defense. [Citation.] The defendant can satisfy its burden by
presenting evidence that negates an element of the cause of action or evidence that the
plaintiff does not possess and cannot reasonably expect to obtain evidence needed to
support an element of the cause of action. [Citation.] If the defendant meets this burden,
the burden shifts to the plaintiff to set forth 'specific facts' showing that a triable issue of
material fact exists." (Securitas Sec. Services USA, Inc. v. Superior Court (2011) 197
Cal.App.4th 115, 119-120.)
We review a trial court's decision on summary adjudication or summary judgment
de novo, liberally construing the evidence in favor of the party opposing the motion and
9
resolving all doubts concerning the evidence in the opposing parties' favor. (Intel Corp.
v. Hamidi (2003) 30 Cal.4th 1342, 1348; Securitas Sec. Services USA, Inc. v. Superior
Court, supra, 197 Cal.App.4th at p. 120.) "We must ' "consider all of the evidence" and
"all" of the "inferences" reasonably drawn therefrom [citation], and must view such
evidence [citations] and such inferences [citations], in the light most favorable to the
opposing party.' " (See's Candy Shops, Inc. v. Superior Court, supra, 210 Cal.App.4th at
p. 900.) Any doubts about the propriety of granting the motion must be resolved in favor
of the party opposing the motion. (Ibid.) This court may affirm an order granting
summary judgment without regard to the trial court's stated reasons, as long as it is
correct on any ground that the parties had an adequate opportunity to address in the trial
court. (Securitas, at p. 120; In re Automobile Antitrust Cases I and II (2016) 1
Mares contends that the trial court erred by denying summary adjudication of his
cause of action for declaratory relief, in which he sought a judicial declaration concerning
his rights and duties with regard to the vehicle and the debt arising from its towing and
sale following its abandonment. More specifically, Mares sought a determination that
under Civil Code section 3068.2 and Vehicle Code sections 5602, subdivisions (a) and
(b), and 5900, he was not "subject to civil or criminal liability for the parking,
abandonment, or operation of the vehicle." Mares maintains the trial court ignored his
10
argument that he had complied with Vehicle Code section 5602, subdivision (a) by
selling the vehicle and delivering the title to the new owner, thus exempting him from
liability for the parking, abandonment and operation of the vehicle. He further contends
the trial court erred when it sustained LEI's objections to paragraph No. 4 of his
declaration in which he described how he signed, dated and otherwise filled out the
certificate of ownership. Finally, Mares maintains his declaratory relief cause of action,
which "seeks to extinguish the debt purportedly owed by [him] to LEI, and halt collection
activity," is sufficiently independent and different from his other causes of action such
that it should be separately determined.
1. Mares's Declaratory Relief Cause of Action Is Cognizable on Summary
Adjudication
We begin with LEI and Advanced's contention that Mares's claim for declaratory
relief is no different from his other causes of action; that the claim raises the same issues
and seeks the same relief as he sought in his negligence and UCL claims. They maintain,
citing a Witkin treatise, that the declaratory relief statute "should not be used for the
purpose of anticipating and determining an issue that can be determined in the main
action." For this proposition, Witkin in turn cites Hood v. Superior Court (1995) 33
Cal.App.4th 319.
Hood does not preclude Mares from seeking summary adjudication, which may be
granted on declaratory relief claims. (See Vector Resources, Inc. v. Baker (2015) 237
Cal.App.4th 46, 54 [summary adjudication is appropriate in a declaratory relief action
when only legal issues are presented for the court's determination]; Spencer v. Hibernia
11
Bank (1960) 186 Cal.App.2d 702, 712.) In Hood, the issue was whether a party may
"select issues (other than duty and punitive damages) implicated in one or more causes of
action in its complaint or cross-complaint, amend that pleading to add a cause of action
for declaratory relief as to those issues, and then obtain a summary adjudication of the
declaratory relief cause of action . . . ." (Hood v. Superior Court, supra, 33 Cal.App.4th
at p. 321, italics added.) The appellate court held that a party cannot extract an element
from another cause of action to resolve by summary adjudication because such a "result
would fully subvert the restrictions of Code of Civil Procedure section 437c, subdivision
(f)(1)." (Id. at p. 321.) Hood deemed the new declaratory relief action to have been
"unnecessary and superfluous . . . ." (Id. at p. 324.) We agree that Hood "does not stand
for the proposition the trial court cannot grant summary adjudication of a properly pled
cause of action for declaratory relief merely because the controversy between the parties
spills over into other causes of action. Rather, the plain lesson of Hood is that parties will
not be allowed to misuse the declaratory relief cause of action in an attempt to subvert the
requirement a summary adjudication must completely dispose of a cause of action."
(Southern Cal. Edison Co. v. Superior Court (1994) 37 Cal.App.4th 839, 846; see also
Supervalu, Inc. v. Wexford Underwriting Managers, Inc. (2009) 175 Cal.App.4th 64, 82-
83.)
2. Mares Is Not Entitled to a Judicial Declaration that He Is Not Liable for the
Deficiency Under Civil Code Section 3068.2 or Vehicle Code Section 5900
However, we conclude that Mares did not establish that as a matter of law he is
entitled to the sought-after judicial declaration under the referenced statutes. A tow truck
12
operator has a statutory lien for the compensation to which it is legally entitled for the
towing and storage of a vehicle that is removed from a public highway. (Civ. Code,
§ 3068.1, subd. (a)(1); see County of Los Angeles v. Superior Court (2015) 242
Cal.App.4th 475, 486.) Civil Code section 3068.2, entitled "Liens and Lien Sales by
Tow Truck Operators for Storage Costs," pertains to deficiency claims of a tow truck
operator who has such a lien. It provides in part: "A tow truck operator who has a lien
on a vehicle pursuant to Section 3068.1 has a deficiency claim against the registered
owner of the vehicle if the vehicle is not leased or leased with a driver for an amount
equal to the towing and storage charges, not to exceed 120 days of storage, and the lien
sale processing fee pursuant to Section 3074, less the amount received from the sale of
the vehicle." (Civ. Code, § 3068.2, subd. (a).) Subdivision (d) of Civil Code section
3068.2 provides in part: "A registered owner who has sold or transferred his or her
vehicle prior to the vehicle's removal and who was not responsible for creating the
circumstances leading to the removal of the vehicle is not liable for any deficiency under
this section if that registered owner executes a notice pursuant to Section 5900 of the
Vehicle Code and submits the notice to the Department of Motor Vehicles. The person
identified as the transferee in the notice submitted to the Department of Motor Vehicles
shall be liable for the amount of any deficiency only if that person received notice of the
transfer and is responsible for the event leading to abandonment of the vehicle or
requested the removal." (Italics added.)
Section 5900 sets forth the required notice to the DMV when a vehicle owner
"sells or transfers his or her title or interest in, and delivers the possession of, the vehicle
13
to another . . . ." (§ 5900, subd. (a).) Whenever that event occurs, "the owner shall,
within five calendar days, notify the department of the sale or transfer giving the date
thereof, the name and address of the owner and of the transferee, and the description of
the vehicle that is required in the appropriate form provided for that purpose by the
department." (§ 5900, subd. (a).)
Mares concedes he did not meet the requirements of Vehicle Code section 5900
because he did not provide the transferee's name and address to the DMV. His
concession disposes of the issue. Neither Civil Code section 3068.2 nor Vehicle Code
section 5900 exclude him from liability for the deficiency on the storage and towing lien
held by Advanced and collected by LEI.
3. Mares Is Not Entitled to A Judicial Declaration That He Is Excluded From
Liability for the Deficiency Under Section 5602
Mares requests a judicial declaration as to his compliance with section 5602,
subdivision (a), which addresses an owner's civil liability for the negligent or wrongful
abandonment of a vehicle by another. As we explain, though Mares presented admissible
evidence he met the requirements of subdivision (a) of that statute,4 such compliance
4 We find merit to Mares's argument that the court erred by sustaining objections to and excluding his supporting evidence regarding his endorsement of the certificate of title, though our conclusion does not alter the outcome of this opinion. LEI purported to object to paragraph No. 4 of Mares's declaration in its opposing separate statement, but did not in its separately-filed evidentiary objections in opposition to Mares's motion. LEI's purported objection to the paragraph was deficient. (Hodiat v. State Farm Mutual Automobile Ins. Co. (2012) 211 Cal.App.4th 1, 7-8.) Advanced objected to the declaration on grounds it lacked foundation, was based on hearsay, assumed facts not in evidence, and violated the secondary evidence rule. It also objected to the paragraph 14
does not resolve his liability for the deficiency stemming from the towing and storage
charges, or the question of whether it was reasonable for Advanced and LEI to direct
their collection efforts for the deficiency at him.
Section 5602 provides two alternative ways for a private seller of a vehicle to
avoid being deemed the "owner of the vehicle so as to be subject to civil liability or
criminal liability for the parking, abandoning, or operation of the vehicle thereafter by
another . . . ." If the seller has made a bona fide sale of the vehicle and has delivered
possession of it to the buyer, the seller is released from such liability thereafter if he or
under Code of Civil Procedure section 437c, subdivision (e), which provides in part that summary adjudication "may be denied in the discretion of the court if the only proof of a material fact offered in support of the summary [adjudication] is an affidavit or declaration made by an individual who was the sole witness to that fact . . . ." Advanced maintains the court did not abuse its discretion in sustaining these objections, characterizing Mares's declaration as "self-serving" and uncorroborated. LEI makes a similar cursory claim. But paragraph No. 4 of Mares's declaration was not the sole evidence on the issue; the record also contains Mares's deposition testimony attesting that he filled out the title. Furthermore, the secondary evidence rule (Evid. Code, § 1521, subds. (a), (d)) was not a bar to admission of Mares's testimony concerning how he filled out the form where the document was missing and there was no evidence of fraudulent intent. (See Evid. Code, § 1523, subd. (b); Dart Industries, Inc. v. Commercial Union Ins. Co. (2002) 28 Cal.4th 1059, 1069-1070 ["A corollary of the rule that the contents of lost documents may be proved by secondary evidence is that the law does not require the contents of such documents be proved verbatim" and the "lost document cases illustrate a few of the many types of secondary evidence that courts have admitted to prove the contents of a missing instrument," including oral testimony that is "often admitted" for this purpose].) We agree Mares's description was within his personal knowledge (Evid. Code, § 702, subd. (a)), it was not hearsay in that it was not concerning an out-of-court statement (Evid. Code, § 1200), and it did not rely on any other evidence. Thus Advanced's foundation and hearsay objections were misplaced. Even construing Mares's evidence in support of his motion strictly as we must (Kight v. CashCall, Inc. (2011) 200 Cal.App.4th 1377, 1386-1387, citing Miller v. Department of Corrections (2005) 36 Cal.4th 446, 460), we conclude the court did not have discretion to exclude paragraph No. 4 of Mares's declaration. As for evidence of Mares's delivery of the certificate to the buyer, the court did not exclude that portion of Mares's declaration, which also was covered in his deposition. 15
she also either properly endorses and delivers the certificate of ownership (§ 5602, subd.
(a)), or delivers or mails to the DMV any of the documents specified in the statute, which
include the notice as provided in section 5900 (§ 5602, subd. (b);5 Hidalgo v. Anderson
(1978) 84 Cal.App.3d 378, 381-383.) Mares concedes he did not meet the requirements
of section 5602, subdivision (b).
The import of section 5602 and the authorities discussing it (including those relied
upon by Mares), is that when a seller provides proof he or she complied with either
alternative in the statute, the seller will no longer be considered an "owner" so as to be
vicariously liable for death, personal injuries or property damage caused by another
person's negligent or wrongful operation, parking or abandonment of the vehicle under
section 17150, otherwise known as the "owner liability statute." (§ 5602; see Lerner v.
Superior Court (1977) 70 Cal.App.3d 656, 658-660 [evidence that the defendant entered
into a bona fide sale and delivery of the vehicle, and also endorsed and delivered the
5 Section 5602 provides in full: "An owner who has made a bona fide sale or transfer of a vehicle and has delivered possession of the vehicle to a purchaser is not, by reason of any of the provisions of this code, the owner of the vehicle so as to be subject to civil liability or criminal liability for the parking, abandoning, or operation of the vehicle thereafter by another when the selling or transferring owner, in addition to that delivery and that bona fide sale or transfer, has fulfilled either of the following requirements: [¶] (a) He or she has made proper endorsement and delivery of the certificate of ownership as provided in this code. [¶] (b) He or she has delivered to the department or has placed in the United States mail, addressed to the department, either of the following documents: [¶] (1) The notice as provided in subdivision (b) of Section 4456 or Section 5900 or 5901. [¶] (2) The appropriate documents and fees for registration of the vehicle to the new owner pursuant to the sale or transfer." In 1987, the Legislature added parking and abandoning to section 5602, releasing a transferring owner of liability for those events in addition to operation. (Stats. 1987, ch. 1097, § 1; see Historical and Statutory Notes, 65D West's Ann. Veh. Code (2015 ed.) foll. § 5602, pp. 14-15.) Mares does not cite any legislative history for this amendment. 16
certificate of ownership, relieved her of exposure to liability for personal injuries and
wrongful death arising from an accident involving the vehicle's buyer]; Savnik v. Hall
(1999) 74 Cal.App.4th 733, 741; Brennan v. Gordon Ball, Inc. (1985) 163 Cal.App.3d
832, 835-836 [reversing judgment for defendant transferor in wrongful death where
defendant did not comply with requirement of delivery of ownership certificate; "[f]or the
purpose of imposing liability under section 17150, the transferor of an automobile
continues to be an owner of the vehicle unless and until he complies with those
conditions prescribed by other provisions of the Vehicle Code to relieve himself of
liability"]; Brown v. Fix (1978) 86 Cal.App.3d 809, 811-813 [a gift is a bona fide transfer
for purposes of applying section 5602 so as to protect the transferor from liability for
damages stemming from an accident caused by another driver]; Hidalgo v. Anderson,
supra, 84 Cal.App.3d at pp. 380-383 [appellants avoided liability for wrongful death and
personal injuries resulting from automobile accident by complying with subdivision (a)
of section 5602]; Durbin v. Fletcher (1985) 165 Cal.App.3d 334, 341-342; Enis v.
Specialty Auto Sales (1978) 83 Cal.App.3d 928, 935-941 [reversing a judgment in favor
of defendants on plaintiff's action for damages and personal injuries where trial court
improperly instructed the jury on the burden of proof; appellate court explained "it is
settled that, for the purpose of imposing liability under section 17150, the transferor of an
automobile continues to be an owner of the automobile unless he complies with the
prerequisites to avoidance of liability as prescribed by section 5602"]; Laureano v.
Christensen (1971) 18 Cal.App.3d 515, 521 [reversing summary judgment in favor of
defendant in personal injury action; defendant who signed but failed to date vehicle
17
ownership certificate did not make a "proper endorsement" under section 5602 and
defendant could not escape liability under section 17150]; Nuss v. Pacht (1971) 22
Cal.App.3d 553 [upholding judgment in personal injury action against seller of vehicle
who had furnished the driver/buyer with an endorsed but undated certificate of
ownership]; Arnold v. Bernay (1950) 95 Cal.App.2d 614 [action for personal injuries by
plaintiff; appellant seller of vehicle was held to have divested himself of ownership and
was protected from liability for the injuries under predecessor statutes (former sections
177 and 178), requiring reversal of the judgment against him]; Woods v. Eastridge (1950)
99 Cal.App.2d 625 [affirming judgment after trial court found defendant was not an
owner liable for personal injuries arising out of an auto collision in which third party
negligently operated the car]; Piacun v. Hexem (1936) 18 Cal.App.2d 145, 149 [reversing
judgment against defendant in an action for personal injury damages stemming from
plaintiff being struck by a car driven by a person other than defendant; defendant
absolved himself as an owner for any liability for imputed negligence—the "statutory
liability for the tortious act of another"—by complying with predecessor statutes to
section 5602].) The " 'statutory liability of the owner [under the owner liability statute] is
predicated on the theory of imputation of wrongdoing and it entirely independent from
any liability based on his or her own negligence.' " (Springmeyer v. Ford Motor Co.,
supra, 60 Cal.App.4th at p. 1571.) To escape such liability, strict compliance with
section 5602 is required as a policy matter for the protection of innocent parties who are
injured by negligently operated vehicles. (Savnik v. Hall, at pp. 741-742; Laureano v.
18
Christensen, at pp. 520-521, 522; Brennan v. Gordon Ball, Inc., at p. 839; Springmeyer v.
Ford Motor Co., at pp. 1570-1571.)
Compliance with section 5602 is not dispositive when the claim is not one of such
vicarious liability. In Springmeyer v. Ford Motor Co., for example, the Court of Appeal
explained that a former vehicle owner's (Avis) compliance with section 5602 was not
implicated by a claim in a product defect case that Avis failed to have a vehicle repaired
in response to the manufacturer's recall notice. The question raised by the evidence was
who owned the vehicle when the recall notice was sent for purposes of a duty to ensure
repair, not whether ownership was effectively transferred for purposes
of the owner liability law. (Springmeyer v. Ford Motor Co., supra, 60 Cal.App.4th at
pp. 1571, 1572 ["Failure to comply with the owner liability statute in connection with the
sale would have left Avis vicariously liable for any negligence on the part of Harvester,
but, again, vicarious liability is not at issue"].)
None of the aforementioned cases, and none of the cases relied upon by Mares
involving section 5602, present issues as to the responsibility for deficiency claims by
tow truck operators following a lien sale after a vehicle is abandoned. The authorities
cited by Mares provide no basis to conclude the Legislature's reference in section 5602 to
"civil liability" refers to such responsibility. Mares engages in no statutory construction,
and he cites no evidence of legislative intent on the question. A judicial declaration as to
Mares's compliance with section 5602 has no bearing on his responsibility for the lien
deficiency at issue; it does not address the subject matter of this dispute. (Accord,
Springmeyer v. Ford Motor Co., supra, 60 Cal.App.4th at pp. 1570-1572.)
19
Rather, as we have summarized above, the Legislature specifically addressed
liability for this very type of claim in Civil Code section 3068.2, and exclusion from
liability under that section requires compliance with Vehicle Code section 5900 only.
Because Mares admits he cannot establish he submitted a notice to the DMV that
identified the name and address of the buyer pursuant to Vehicle Code section 5900, and
further admits the DMV records showed he was the vehicle's registered owner, he was as
a matter of law liable for the debt. On this basis, summary adjudication of his claim for
declaratory relief was properly denied.
Even if we were to assume arguendo that Vehicle Code section 5602's reference to
civil liability encompasses the same subject as Civil Code section 3068.2, that is, liability
for towing and storage charge deficiencies stemming from the abandonment of a vehicle,
we would reach the same conclusion. The two statutes conflict as to the requirements for
absolving a registered owner of such liability. Thus, we would apply the principle that
where two statutes relate to the same subject but irreconcilably conflict, the later and
more specific statute will prevail over the earlier, more general one. (See In re Greg F.
(2012) 55 Cal.4th 393, 407; Wells v. One2One Learning Foundation (2006) 39 Cal.4th
1164, 1208.) Civil Code section 3068.2, enacted in 1994, is the more recent and specific
enactment on the subject than Vehicle Code section 5602, and that provision controls.
20
4. Sections 22523 and 22524
Both parties point to sections 22523 and 22524, and advance arguments as to why
those provisions should be interpreted to either impose responsibility on Mares for costs
related to the vehicle's abandonment, or relieve him of such responsibility. But these
provisions are inapplicable, as a matter of law, to the instant case.
Section 22523 makes it unlawful to abandon a vehicle on a highway, as well as on
public or private property without the express or implied consent of the owner or person
in lawful possession or control of the vehicle. (§ 22523, subds. (a), (b).) The section
makes the offense an infraction punishable by a fine and, absent proof the vehicle was
stolen before abandonment, payment of the costs of removal and disposition of the
vehicle. (§ 22523, subds. (c), (d).)
Vehicle Code section 22523, subdivision (f)(1) addresses who is guilty of an
infraction when the abandoned vehicle is not redeemed after impound, and sets forth
punishment. It provides: "If a vehicle is abandoned in violation of subdivision (b) and is
not redeemed after impound, the last registered owner is guilty of an infraction. In
addition to any other penalty, the registered owner shall be liable for any deficiency
remaining after disposal of the vehicle under Section 3071 or 3072 of the Civil Code or
Section 22851.10 of this code." (Italics added.) Under subdivision (f)(2) of Vehicle
Code section 22523, the owner is relieved of liability "under this subdivision" by "[t]he
filing of a report of sale or transfer of the vehicle pursuant to Section 5602, the filing of a
vehicle theft report with a law enforcement agency, or the filing of a form or notice with
21
the department pursuant to subdivision (b) of Section 4456 or Section 5900 or 5901 . . . ."
(Italics added.)
When a vehicle is abandoned within the meaning of section 22523, the Legislature
has created a "prima facie presumption that the last registered owner of record is
responsible for the abandonment and is thereby liable for the cost of removal and
disposition of the vehicle." (§ 22524, subd. (a).) However, "[a]n owner who has made a
bona fide sale or transfer of a vehicle and has delivered possession of the vehicle to a
purchaser" may overcome that presumption "by demonstrating that he or she has
complied with Section 5900 or providing other proof satisfactory to the court." (§ 22524,
subd. (b).)
We read the release of "liability under this subdivision" language in section 22523,
subdivision (f)(2), along with section 22524, to mean that a registered owner will be
relieved of liability for an infraction and any associated penalties by the filing of the
enumerated documents, and that the rebuttable presumption stated in section 22524 will
apply in infraction proceedings. But there is no evidence Mares was charged with or
underwent any sort of proceeding on an infraction (see People v. Simpson (2014) 223
Cal.App.4th Supp. 6, 9 [describing procedures for infractions]), or that a court imposed
any penalty for such an offense, which could include the deficiency following a lien sale.
We decline to divorce the rebuttable presumption set out in section 22524 from the
infraction set out in section 22523. But if we were to do so, Mares has conceded below
that he did not comply with section 5900, and thus cannot rebut any presumption of
responsibility. Mares claims that his endorsement and delivery of the certificate of title
22
and vehicle to the buyer under section 5602, subdivision (a) constitutes a "transfer of the
vehicle" within the meaning of section 22523, and that such a "transfer" suffices to
release him of liability for the vehicle's abandonment. But we cannot agree with his
parsing of the statute. As we interpret section 22523, subdivision (f)(2), it requires the
"filing of a report of sale or transfer" within the meaning of section 5900 (§§ 5602, subd.
(b), 5900, subd. (a) [referring to giving notice to the department "of the sale or transfer"]),
not merely evidence of delivery of a certificate of title to an unknown buyer, to relieve a
registered owner of liability for an infraction.
B. Advanced's Statutory Duty of Care
Mares contends the trial court erred by denying summary adjudication on the issue
of Advanced's statutory duty of care and limiting Advanced's duty to merely determining
the identity of the vehicle's registered owner. He maintains that Advanced as a tow truck
operator must comply with a number of statutory duties under Vehicle Code sections
5602 and 10652.5, and Civil Code sections 3068.2, 3071, and 3072, which he asserts
require an investigation more thorough than a simple check of the registered owner's
identity, namely, to check the DMV registration and other DMV filings to ascertain the
identities of the "registered owner, the legal owner and any other interested parties."
Mares correctly points out that summary adjudication may be proper as to one or more
issues of duty. (Code Civ. Proc., § 437c, subd. (f)(1).)
As a threshold matter, these claims are procedurally barred by Mares's failure to
allege such specific statutory duties under these statutes in his first amended complaint.
(Accord, Distefano v. Forester (2001) 85 Cal.App.4th 1249, 1266; see Cerna v. City of
of a mandatory duty under a statute].) A motion for summary adjudication may not be
granted on issues not raised by the pleadings; it is the allegations in the complaint to
which the motion must respond. (Laabs v. City of Victorville (2008) 163 Cal.App.4th
1242, 1258; Cerna, at pp. 1349-1350 [pleadings limit the issues on a motion for summary
judgment].)
Were there no procedural bar, Mares has not established he is entitled as a matter
of law to adjudication of any such statutory duty. As stated, under Civil Code section
3068.1, subdivision (a), a tow operator has a statutory lien for certain towing and storage
charges incurred in impounding a vehicle. (Civ. Code, § 3068.1, subd. (a)(1); see County
of Los Angeles v. Superior Court, supra, 242 Cal.App.4th at p. 486.) When the vehicle
has a value not exceeding $4,000, the "lien shall be satisfied pursuant to Section 3072."
(Civ. Code, § 3068.1, subd. (b).) Before the vehicle may be sold to satisfy this lien, the
towing company must provide notice to its registered and legal owner by certified mail,
and it must obtain names and addresses from the DMV to perform its statutory duty to
provide this notice to owners of impounded or stored vehicles. (County of Los Angeles,
at p. 486, citing Civ. Code, §§ 3071, subd. (b)(2), 3072, subd. (b); Veh. Code, § 22851.8,
subd. (b).)6 The disclosure of addresses to tow companies by the DMV "facilitates the
6 Civil Code Sections 3071 and 3072 respectively relate to a lienholder's application for authorization to conduct a lien sale, and the procedures for such a sale. The application "shall" include certain information, including "[t]he names and addresses of the registered and legal owners of the vehicle, if ascertainable from the registration certificates within the vehicle, and the name and address of any person whom the 24
statutory requirement of notice to registered and legal owners of vehicle." (County of Los
Angeles, at p. 486.) Liens for fees or charges for parking and storage of a vehicle "shall
be subject to Section 10652.5 of the Vehicle Code" (Civ. Code, §§ 3071, subd. (l), 3072,
subd. (j)), which limits a claim for storage charges to 15 days unless certain notice
gives a tow truck operator with a statutory lien "a deficiency claim against the registered
owner of the vehicle . . . ." (Civ. Code, § 3068.2, subd. (a), italics added.) As we have
discussed above, a registered owner "is not liable for any deficiency under this section" if
the owner complies with Vehicle Code section 5900 (Civ. Code, § 3068.2, subd. (d)), a
condition Mares agrees he did not meet.
lienholder knows, or reasonably should know, claims an interest in the vehicle." (Civ. Code, § 3071, subd. (a)(2).) A lienholder who seeks to sell a vehicle valued $4,000 or less "shall apply to the department for the names and addresses of the registered and legal owners of record" and send certain information, including a notice of pending lien sale, to those persons and to "any other person known to have an interest in the vehicle." (Civ. Code, § 3072, subds. (a), (b).) Noncompliance with these requirements voids the lien sale. (Civ. Code, §§ 3071, subd. (l), 3072, subd. (j).) 7 Vehicle Code section 10652.5, subdivision (a) provides: "Whenever the name and address of the legal owner of a motor vehicle is known, or may be ascertained from the registration records in the vehicle or from the records of the Department of Motor Vehicles, no fee or service charge may be imposed upon the legal owner for the parking and storage of the motor vehicle except as follows: (1) the first 15 days of possession and (2) following that 15-day period, the period commencing three days after written notice is sent by the person in possession to the legal owner by certified mail, return receipt requested, and continuing for a period not to exceed any applicable time limit set forth in Section 3068 or 3068.1 of the Civil Code." Here, there is no dispute Advanced via its lien servicer obtained DMV records to ascertain the registered owner. We agree with Advanced that Vehicle Code section 10652.5 does not expand the scope of any investigation by a towing company relating to the limits for storage fees and charges beyond looking into the registration records within the vehicle and DMV records. 25
These statutes do not create a special standard of conduct or any affirmative duty
of care upon Advanced to conduct any sort of investigation with respect to collecting on
its deficiency claim beyond ascertaining the registered owner of the vehicle who is
responsible for the deficiency. (Civ. Code, § 3068.2, subd. (a).) These statutes impose
notice obligations on lienholders for purposes of conducting the lien sale or limiting the
fee or service charge amounts, and Mares makes no claim that Advanced failed to
provide adequate notice to him in connection with its lien sale efforts or the amount of
charges. These statutes do not impose obligations relating to later collection efforts on
the deficiency. We do not find in their language any legislative intent to create, nor has
Mares cited authority establishing or suggesting, a statutory duty of care as Mares urges.
We reach the same conclusion with respect to Vehicle Code section 5602, which as we
have explained does not pertain to a registered owner's liability for a deficiency claim for
towing and storage charges following a lien sale.
III. Respondents' Motion for Summary Judgment
A. Advanced's and LEI's Duty of Care
Based on the premise that he complied with section 5602, subdivision (a) so as to
relieve himself from liability from the towing and storage debt, Mares contends he
presented evidence demonstrating a triable issue of material fact as to whether Advanced
conducted a reasonable investigation into whether he was liable for the debt before its
collection efforts. He concedes that the evidence shows Advanced obtained DMV
registration information from its lien servicer, which showed Mares had filed a release of
liability form and had sold the vehicle for $1,000. He argues, "Rather than continue to
26
reasonably inquire about the sale of the vehicle, Advanced ignored the fact that the DMV
had recorded a sale and attempted to collect the debt from Mr. Mares." Mares further
contends that there are triable issues as to whether both Advanced and LEI conducted a
reasonable investigation after he and his father called Advanced to challenge the debt and
inform them he had sold the vehicle.
A negligence action "requires a showing that the defendant owed the plaintiff a
legal duty, that the defendant breached the duty, and that the breach was a proximate or
legal cause of injuries suffered by the plaintiff." (Ambriz v. Kelegian (2007) 146
Cal.App.4th 1519, 1532; see United States Liability Ins. Co. v. Haidinger–Hayes, Inc.
(1970) 1 Cal.3d 586, 594.) It is settled that the existence and scope of a legal duty of due
care are legal questions for the court. (Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465,
477; Vasilenko v. Grace Family Church (2016) 248 Cal.App.4th 146, 152, review
granted September 21, 2016, S235412.) As the moving parties on summary judgment,
LEI and Advanced had the burden of showing that Mares's negligence causes of action
lacked merit because one or more elements could not be established or there was a
complete defense to those causes of action. (Code Civ. Proc., § 437c, subd. (p)(2);
Vasilenko, at p. 153.) In support of its motion, LEI argued that it never breached any
duty of reasonable care it might have owed to Mares because its attempts to collect the
debt were reasonable, and all of the documents and information provided to it identified
Mares as the registered owner.
Whether Mares can maintain a negligence action against Advanced and LEI for
failing to conduct a reasonable investigation, or engaging in illegal collection efforts, is
27
resolved by our conclusion that as a matter of law, Advanced as the lienholder possessed
its deficiency claim against Mares, the registered owner of the vehicle of record. (Civ.
Code, § 3068.2.) The evidence is undisputed that Advanced obtained DMV registration
information showing Mares to be the registered owner, and notified LEI of that fact with
documentation, leading LEI to likewise confirm his status as the person responsible for
the deficiency. While evidence that Mares endorsed and delivered the certificate of title
to a buyer would relieve Mares from liability from a personal injury or property damage
action brought by a third party injured by the vehicle's abandonment, it did not relieve
Mares from responsibility for the deficiency following the lien sale. That evidence does
not create a triable issue of material fact on the question of Advanced and LEI's duty, or
breach of duty, to pursue or collect the debt against the person responsible for it.
Likewise, Mares's filing of the notice of transfer does not raise a triable issue for a jury
because the notice did not identify any buyer and therefore did not meet the requirements
of section 5900, which would absolve Mares of liability for the deficiency due to the
vehicle's sale or transfer. (Civ. Code, § 3068.2, subd. (d).) We conclude the trial court
properly granted summary judgment in Advanced and LEI's favor.
B. Mares's Cause of Action for Defamation Against LEI
Mares contends the trial court erred by granting summary judgment on his cause
of action for defamation against LEI, in which he alleged in part that LEI made false
statements to credit reporting agencies that Mares had failed to pay a debt owed to
Advanced and/or LEI. Mares points to evidence that LEI had a policy or procedure to
collect all towing and storage-related debts from the party listed on the DMV registration
28
information as the owner of record at the time of the vehicle's impoundment. He argues
in view of his lack of liability for the towing and storage bill as well as evidence that LEI
possessed information that he was not liable for the debt but conducted no investigation,
there is a triable issue of material fact as to whether LEI furnished false information to a
consumer reporting agency with malice or willful intent to injure a consumer such that
his claim is not exempt from the FCRA.
We need not reach the FCRA arguments. To state a defamation claim, a plaintiff
must present evidence of a statement of fact that is provably false. (Seelig v. Infinity
Broadcasting Corp. (2002) 97 Cal.App.4th 798, 809 ["There can be no recovery for
defamation without a falsehood"].) Again, the premise of Mares's argument is that he
presented evidence he was not responsible for the towing and storage debt or deficiency,
namely, that he had properly endorsed and delivered the certificate of title to the buyer,
and that the DMV records showed that a sale had occurred. But as we have explained,
Mares was as a matter of law liable for the deficiency under Civil Code section 3068.2
notwithstanding that evidence, because DMV records continued to show Mares was the
vehicle's registered owner, and Mares presented no evidence that he complied with the
filing under section 5900 that would relieve him from liability from that debt. In short,
Mares's cited evidence does not raise a triable issue of material fact for a jury on the
question of whether Advanced or LEI provided false information to any credit agency by
accurately identifying Mares as the debtor on its deficiency claim. Summary judgment
was properly granted on that claim.
29
C. Mares's UCL Cause of Action
"The UCL does not proscribe specific activities, but in relevant part broadly
prohibits 'any unlawful, unfair or fraudulent business act or practice.' [Citation.]
' " 'Because [Business and Professions Code] section 17200 is written in the disjunctive,
it establishes three varieties of unfair competition—acts or practices which are unlawful,
or unfair, or fraudulent. "In other words, a practice is prohibited as 'unfair' or 'deceptive'
even if not 'unlawful' and vice versa." ' " ' [Citations.] [¶] A private party has standing
to bring a UCL action only if he or she 'has suffered injury in fact and has lost money or
property as a result of the unfair competition.' " (Aleksick v. 7–Eleven, Inc. (2012) 205
Cal.App.4th 1176, 1184.)
Mares's claim for violation of the UCL is predicated on his negligence and
defamation claims. Having concluded LEI and Advanced are entitled to summary
judgment on those causes of action, we affirm the ruling disposing of the derivative UCL
claim as well. (Javorsky v. Western Athletic Clubs, Inc. (2015) 242 Cal.App.4th 1386,
Holding. The court held that the plaintiff was not entitled to a judicial declaration of nonliability for towing and storage deficiency fees under Vehicle Code section 5602, subdivision (a), because that provision does not apply to such deficiency claims. Furthermore, the court affirmed summary judgment for the defendants, finding they acted reasonably by relying on DMV records identifying the plaintiff as the registered owner.
Issues
Whether the trial court erred in denying the plaintiff's motion for summary adjudication of his declaratory relief cause of action.
Whether the trial court erred in granting summary judgment for the defendants on the plaintiff's negligence and defamation claims.
Whether the plaintiff's compliance with Vehicle Code section 5602, subdivision (a) absolves him of liability for a lienholder's deficiency claim for towing and storage fees.
Disposition. Affirmed.
Quotations verified verbatim against the opinion
“Mares did not show as a matter of law he was entitled to a judicial determination of nonliability under section 5602, subdivision (a), because the reference in that section to "civil liability for . . . abandoning" does not refer to responsibility for a lienholder's deficiency claim for towing and storage fees following a lien sale.”
“We also hold summary judgment on Mares's negligence claims was proper based on undisputed evidence that Advanced and LEI determined that Mares was the registered owner of record at the time the vehicle was towed.”