Motion for an Order Discharging and Dismissing Escrow from Case, and Order Escrow to Deposit Interpleaded Funds
the stay until the parties complete their scheduled mediation on 9/15/26. Defendant offers perfunctory excuses for failing to pay, in that the case transitioned between defense firms and amongst different attorneys within those firms; and the insurance carrier representative went out on leave in April 2026. (Oppn at 3:2-3:12.)
However, no declaration is offered to support any of these arguments, nor are any specifics given explaining in detail how or why the payment was not made. Thus, it appears to the Court that Defendant’s failure to pay was willful. (See People v. Bollaert (2016) 248 Cal. App. 4th 699, 710 (“[T]he word ‘willfully’ as generally used in the law is a synonym for ‘intentionally,’ . . . and ‘implies no evil intent[,] ‘it implies that the person knows what he is doing, intends to do what he is doing and is a free agent.’”).)
Accordingly, the motion is GRANTED. The stay is lifted. Sanctions shall be addressed by way of separate motion to be brought by Plaintiff pursuant to CCP §1281.98(c). (See also CCP §1281.99.) Plaintiff to give notice.
106 Bunker Hill Apartments, LLC vs. GMS Group Inc.
25-01505195 Motion for an Order Discharging and Dismissing Escrow from Case, and Order Escrow to Deposit Interpleaded Funds
Defendant La Costa Escrow, Inc. (“La Costa”) seeks to interplead funds in the amount of $958,843.27, less La Costa’s attorney fees and escrow fees, and an order discharging La Costa from liability and dismissing it from this action. This action involves the sale of real property by plaintiffs Bunker Hill Apartments LLC and Tony Holder (“Plaintiffs”) to GMS Group Inc. (“GMS”). La Costa was designated as the escrow holder for the transaction. La Costa was notified that the sale was being canceled but did not receive mutually signed instructions from the parties. La Costa has no interest in or claim to the funds. (Declaration of Lauri Shahar ¶ 2.)
Interpleader is a procedure whereby a person holding money or personal property to which conflicting claims are being made by others, can join the adverse claimants and force them to litigate their claims among themselves. (
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Code of Civil Procedure section 386.5 provides: Where the only relief sought against one of the defendants is the payment of a stated amount of money alleged to be wrongfully withheld, such defendant may, upon affidavit that he is a mere stakeholder with no interest in the amount or any portion thereof and that conflicting demands have been made upon him for the amount by parties to the action, upon notice to such parties, apply to the court for an order discharging him from liability and dismissing him from the action on his depositing with the clerk of the court the amount in dispute and the court may, in its discretion, make such order.
“It is the stakeholder’s avowed disinterest in the interpleaded proceeds which gives him the right to interplead.” (Pacific Loan Management Corp. v. Superior Court (1987) 196 Cal.App.3d 1485, 1489.) “[C]ases [have] made [it] clear that a typical situation suitable for interpleader is that where a disinterested escrow holder faces conflicting claims to the escrowed property.” (Ibid.) This includes a situation where “one claimant notified the escrow holder that the contract was canceled and nothing should be paid to the other claimant[,]” (Id. at p. 1490.) “Further, interpleader may be permitted even though one claimant seeks part of the fund and the other claimant seeks the entire fund amount.” (Morgan Hill, 71 Cal.App.4th 1114, 1123.)
Plaintiffs allege they received multiple offers and relied upon a fabricated proof of funds reflecting an account balance exceeding $30 million in accepting GMS’s purchase offer. They further allege that GMS failed to wire the full purchase price before the June 23 foreclosure sale date and Plaintiffs thereafter lawfully canceled the purchase agreement. Plaintiffs allege that they suffered the following damages because of GMS’s breach and fraud: earnest money deposit of $27,000; extension deposit of $50,000; foreclosure rescue funds of $65,708.94; loan repayment of $515,000; lost equity of $293,000; and additional wires to buy out former LLC members, for a total damages claim of $958,708.94.
Dr. Mohammed Khalid Haridy Ghafeer alleges that he deposited $958,843.27 into escrow with La Costa for the purchase of the property on behalf of GMS. Dr. Ghafeer alleges that $30,000 was delivered on May 1, 2025, $50,000 was delivered pursuant to an agreement between Plaintiffs and GMS to extend the close of escrow, $500,000 and $305,000 were deposited on June 25, 2025, and $73,843.27 was deposited on June 26, 2025. Dr. Ghafeer further alleges that Plaintiffs have asserted that they are entitled to the $958,843.27 held by La Costa and that the money should be released to them, which Dr. Ghafeer asserts is wrongful.
Dr. Ghafeer argues that this Court held on June 16, 2026, that Plaintiffs are not entitled to the escrow funds. This is incorrect. The Court merely held that Plaintiffs had not demonstrated that the funds are due to them in support of their own Motion.
Further, while the $1.27 million in losses claimed by Plaintiffs in support of their own Motion for carrying costs, equity loss, and money paid to stop the foreclosure sale are not claims related to the escrow funds, it is clear by their refusal to release the funds to Dr. Ghafeer that they claim entitlement to at least a portion, which is sufficient to support the requested interpleader. Thus, the Court finds that Plaintiffs and Dr. Ghafeer have competing claims to the escrow funds held by La Costa.
Dr. Ghafeer further argues that the Court should authorize the release of the escrow funds to him, as there is no dispute that he supplied them. However, Dr. Ghafeer ignores the fact that Plaintiffs may be entitled to keep all or some portion of the deposit under the sales contract pursuant to the liquidated damages clause included therein, which Dr. Ghafeer acknowledges in his own complaint-in-intervention, if Plaintiffs can prove that Dr. Ghafeer was a buyer in default. Thus, this argument is rejected.
La Costa requests escrow fees and costs totaling $9,417.49. No parties dispute this amount. La Costa also requests $9,603.12 in attorney fees. “In ordering the discharge of such party, the court may, in its discretion, award such party his costs and reasonable attorney fees from the amount in dispute which has been deposited with the court.” (Code Civ. Proc., § 386.6(a).)
Plaintiffs argue the attorney fees should not be granted because the statute requires that the funds be deposited and the party discharged before any discretionary attorney fees are awarded. Plaintiffs cite Wells Fargo Bank, N.A. v. Zinnel (2004) 125 Cal.App.4th 393, where the Court of Appeal held that attorney fees under section 386.6 could not be awarded because the interpleader plaintiff released the funds to a defendant instead of depositing them with the court and fees could be awarded only out of deposited funds. (Id. at p. 403.)
This case is inapposite, as La Costa has not sought an order for it to release the funds to any party and, unlike in Zinnel, seeks to deposit the funds with the Court. Plaintiffs further argue that La Costa improperly seeks reimbursement for fees that go beyond pursuit of the interpleader and the requested fees should be reduced. The Court agrees that anticipated fees and costs that have not yet been incurred should not be included in the award but finds the remaining fees and costs to be proper.
In light of the above, La Costa’s Motion for Interpleader is GRANTED. La Costa is ordered to deposit with the court clerk the escrow funds of 958,843.27 less the escrow fees and costs in the amount of $9,417.49 and attorney fees and costs in the amount of $7,428.12. Upon the ordered deposit, La Costa shall be discharged from liability to either party and dismissed from this action. Moving party to give notice.
107 Child vs. Department of Motor Vehicles
25-01529954 Petition for Writ of Mandate
On 11/26/2025 Petitioner Joshua Child filed an Alternative Writ of Mandate. On 5/20/2026 pursuant to Chambers Work- CMC, this Court set the Petition for Writ for 7/28/2026 and ordered Petitioner to give notice. (ROA 13).
To date, there is nothing in the Court’s file to indicate Plaintiff/Petitioner gave notice to Defendant of the hearing date. Furthermore, there is no certified administrative record before the Court (Govt. Code § 11523), or points and authorities in support of the Petition (Rules of Court, rule 3.1113). As such, the Court denies the writ of mandate.