Keely Gonzalez et al vs Michael D’Alise et al

Case Number

21CV04044

Case Type

Hearing Date / Time

Fri, 05/31/2024 - 10:00

Nature of Proceedings

Motion: Assignment Order

Tentative Ruling

For the reasons set forth herein, plaintiffs’ motion for assignment order is denied without prejudice.

Background:

On October 12, 2021, plaintiffs Keely Gonzalez and Reece Williams (collectively, Plaintiffs) filed their original complaints as two separate actions each asserting 12 causes of action against defendant Michael D’Alise arising out of their former employment with D’Alise. On July 14, 2022, the two actions were consolidated.

The parties to the action entered into a settlement agreement to resolve both matters for payment of $160,000.00 by D’Alise to plaintiffs. Judgment was entered on September 14, 2023. (Pellegrini Dec., ¶ 4.) D’Alise has not paid any amount towards the judgment. (Pellegrini Dec., ¶ 5.)

Plaintiffs’ counsel believes that D’Alise derives his primary source of income from providing music licensing services to music production companies including Capitol Records, Creative Artists Agency, and Paramount Global, and that those entities periodically tender payment to D’Alise for services rendered. (Pellegrini Dec., ¶¶ 6, 7.)

A debtor’s examination took place on January 12, 2024, but was not completed. The debtor’s examination was continued for further examination to take place on March 15, 2024. D’Alise did not appear on March 15, 2024, a bench warrant was issued (stayed), and the debtor’s examination was continued to May 3, 2024.

Plaintiffs now move for an assignment order for any payments to be made to D’Alise by Capitol Records, Creative Artists Agency, and Paramount Global.

No opposition or other document has been filed in response to the motion. D’Alise was served with the motion on April 9, 2024.

Analysis:

Code of Civil Procedure section 708.510 provides:

“(a) Except as otherwise provided by law, upon application of the judgment creditor on noticed motion, the court may order the judgment debtor to assign to the judgment creditor or to a receiver appointed pursuant to Article 7 (commencing with Section 708.610) all or part of a right to payment due or to become due, whether or not the right is conditioned on future developments, including but not limited to the following types of payments:

“(1) Wages due from the federal government that are not subject to withholding under an earnings withholding order.

“(2) Rents.

“(3) Commissions.

“(4) Royalties.

“(5) Payments due from a patent or copyright.

“(6) Insurance policy loan value.

“(b) The notice of the motion shall be served on the judgment debtor. Service shall be made personally or by mail.

“(c) Subject to subdivisions (d), (e), and (f), in determining whether to order an assignment or the amount of an assignment pursuant to subdivision (a), the court may take into consideration all relevant factors, including the following:

“(1) The reasonable requirements of a judgment debtor who is a natural person and of persons supported in whole or in part by the judgment debtor.

“(2) Payments the judgment debtor is required to make or that are deducted in satisfaction of other judgments and wage assignments, including earnings assignment orders for support.

“(3) The amount remaining due on the money judgment.

“(4) The amount being or to be received in satisfaction of the right to payment that may be assigned.

“(d) A right to payment may be assigned pursuant to this article only to the extent necessary to satisfy the money judgment.

“(e) When earnings or periodic payments pursuant to a pension or retirement plan are assigned pursuant to subdivision (a), the amount of the earnings or the periodic payments assigned shall not exceed the amount that may be withheld from a like amount of earnings under Chapter 5 (commencing with Section 706.010) (Wage Garnishment Law).

“(f) Where a specific amount of the payment or payments to be assigned is exempt by another statutory provision, the amount of the payment or payments to be assigned pursuant to subdivision (a) shall not exceed the amount by which the payment or payments exceed the exempt amount.”

The legislative committee comment to section 708.510 explains: “Section 708.510 provides a new procedure for reaching certain forms of property that cannot be reached by levy under a writ of execution, such as the nonexempt loan value of an unmatured life insurance, endowment, or annuity policy. See Sections 699.720(a) (6), 704.100. It also provides an optional procedure for reaching assignable forms of property that are subject to levy, such as accounts receivable, general intangibles, judgments, and instruments.”

An account receivable includes, among other things, “a right to payment of a monetary obligation, whether or not earned by performance . . . for services rendered or to be rendered . . .” (Cal. U. Com. Code, § 9102, subd. (a)(2), adopted by Code Civ. Proc., § 680.130.)

“The wage garnishment law provides the exclusive judicial procedure by which a judgment creditor can execute against the wages of a judgment debtor, except for cases of judgments or orders for support.” (California State Employees’ Assn. v. State of California (1988) 198 Cal.App.3d 374, 377, Italics added.) “Except for an earning assignment order for support, the earnings of an employee shall not be required to be withheld by an employer for payment of a debt by means of any judicial procedure other than pursuant to this chapter.” (Code Civ. Proc., § 706.020, italics added.)

An independent contractor is not an employee. (See People v. Uber Technologies, Inc. (2020) 56 Cal.App.5th 266, 287.)

“Insofar as the attachment law and wage garnishment law reflect or establish public policy, it is obvious that they provide substantial protection for wages against both pretrial attachments and enforcement of judgments. ‘The policy underlying the state’s wage exemption statutes is to insure that regardless of the debtor’s improvidence, the debtor and his or her family will retain enough money to maintain a basic standard of living, so that the debtor may have a fair chance to remain a productive member of the community.’ [Citation.]” (California State Employees’ Assn. v. State of California, supra, 198 Cal.App.3d at p. 377.)

The information plaintiffs provided to the court is insufficient for the court to issue an assignment order at this time. Plaintiffs’ counsel does not state how she knows that D’Alise receives income for providing music licensing services to music production companies, whether D’Alise is an employee (receiving wages) or an independent contractor, whether there are other judgments for which D’Alise is liable, what D’Alise’s living requirements are, whether D’Alise supports any other persons, or whether D’Alise receives income from any other source. Without this information, the court is unwilling to assign the entirety of the payments from the music production companies, as requested by plaintiffs, and potentially leave D’Alise unable to maintain a basic standard of living for himself and his family.

This denial will be without prejudice for plaintiffs to again seek an assignment order should they obtain further information and present it in a foundationally sound and legally sufficient manner.