Joshua Armel vs One Key LLC et al

Case Number

25CV03512

Case Type

Hearing Date / Time

Wed, 11/12/2025 - 10:00

Nature of Proceedings

1) Motion re OSC Why Ex Parte Order Appointing Receiver Should Not Be Vacate; 2) Motion: Set Aside re Default

Tentative Ruling

For Plaintiff Joshua Armel as Trustee of the Forge Trust Co. Joseph A. Armel

Decedent CFBO Revocable Living Trust of Joseph Armel: Jared M. Katz, Parker W. Johnson, Mullen & Henzell

For Defendants One Key LLC, Maksim Anatolyevich Mironov, and Anton Mironov: John J. Thyne III, Thyne Taylor Fox Howard LLP

Receiver: Kevin Singer

                                           

Ekaterina Svensson: Defendants' Agent and purported "tenant" of Receivership Estate real properties.                      

RULING

For the reasons set forth herein:

1. Defendant One Key LLC’s motion to set aside default is granted. One Key LLC shall separately file and serve its answer to Plaintiff’s complaint no later than November 19, 2025.

2. Defendants Maksim Anatolyevich Mironov and Anton Mironov’s motion for order to show cause re why the ex parte order appointing receiver should not be vacated is partially granted as follows:

1. The Court issues an Order to Show Cause re the necessity and appropriateness of a Receiver, with a hearing date of March 11, 2026, at 10:00 a.m. in this department.

2. Counsel for the parties are ordered to appear at the hearing on November 12, 2025, either in person or virtually, and be prepared to discuss a briefing schedule for the hearing on the Order to Show Cause.

3. As an interim order, Kevin Singer will remain as Receiver, but his powers shall be modified as follows:

Defendants shall pay to Receiver the outstanding loan payments, and additional amounts as they become due, and Receiver shall treat the funds as receivership property.

Upon receiving the initial payment, the receiver shall release possession and control of the subject properties to Defendants, including property assets, rents, revenue, etc. related thereto.

Receiver, to the extent he has possession of any, shall also, upon receiving the initial payment, turn over to Defendants possession of all records, books of account, ledgers, and all other documents and papers pertaining to the operation of the properties.

Receivership fees are, at least temporarily, to be paid from the loan payments, and are subject to allocation or reallocation at any later time by order of the Court

4. Defendants continue to be temporarily restrained from transferring, conveying, assigning, pledging, deeding, selling, renting, leasing, encumbering, changing ownership of, vesting title to, or otherwise disposing of the properties.

5. Plaintiff and Defendants are ordered to file and serve status reports regarding Marin County Probate Case No. 25PR0000531, including the status of any orders, claims relevant to the subject Notes, or upcoming hearings, no later than November 21, 2025, and supplemental status reports on February 18, 2026.

Background

This action commenced on June 5, 2025, by the filing of the complaint by Plaintiff Joshua Armel as Trustee of the Forge Trust Co. Joseph A. Armel Decedent CFBO Revocable Living Trust of Joseph Armel (Plaintiff) against Defendants One Key LLC (One Key), Maksim Anatolyevich Mironov (Maksim), and Anton Mironov (Anton) (collectively “Defendants”) for: (1) breach of contract – specific performance, (2) appointment of receiver, (3) breach of contract – monetary damages, (4) enforcement of personal guarantee, and (5) common count – money lent and received. (Note: Due to common surnames, Maksim and Anton will be referred to by their given names for clarity. No disrespect is intended.)

As alleged in the complaint:

From November 9, 2021 to July 11, 2024, Plaintiff and Defendants entered into a series of loans secured by the real property located at: (1) 316 W. Pedregosa St., Santa Barbara (the “Pedregosa Property”), (2) 419 Transfer Ave., Santa Barbara (the “Transfer Property”), (3) 1524 State St., Santa Barbara (the “State Property”), (4) 812 Jennings Ave., Santa Barbara (the “Jennings Property”), and (5) 136 Haley St., Santa Barbara (the “Haley Property”). (Compl., ¶ 10 & Exhs. A-E.)

On November 9, 2021, One Key, with Maksim acting as “owner/manager,” made, executed, and delivered to Plaintiff a written promissory note in the sum of $500,000.00 (the “11/9/2021 note”). (Compl., ¶ 13 & Exh. F.) Maksim is the guarantor of the 11/9/2021 note. (Ibid.)

On February 11, 2023, the 11/9/2021 note was modified to lower the applicable interest rate and monthly payments due. (Compl., ¶ 14 & Exh. G.) To secure payment on the 11/9/2021 note, One Key and Maksim made, executed, and delivered to Plaintiff, as beneficiary, a deed of trust, conveying to Fidelity National Title Company as trustee, the Pedregosa Property, the Transfer Property, the State Property, and the Jennings Property. (Id. at ¶ 15 & Exh. H.) Plaintiff is, and at all relevant to this action was, the lawful owner and holder of the 11/9/2021 note and holds a beneficial interest under the deed of trust. (Id. at ¶ 16.)

On November 22, 2021, One Key, with Maksim acting as “owner/manager,” made, executed, and delivered to Plaintiff a written promissory note in the sum of $600,000.00 (the “11/22/2021 note”). (Compl., ¶ 19 & Exh. I.) Maksim is the guarantor of the 11/22/2021 note. (Ibid.)

On February 11, 2023, the 11/22/2021 note was modified to lower the applicable interest rate and monthly payments due. (Compl., ¶ 20 & Exh. J.) To secure payment on the 11/22/2021 note, One Key and Maksim made, executed, and delivered to Plaintiff, as beneficiary, a deed of trust, conveying to Fidelity National Title Company as trustee, the Original Secured Properties. (Id. at ¶ 21 & Exh. K.) Plaintiff is, and at all relevant to this action was, the lawful owner and holder of the 11/22/2021 note and holds a beneficial interest under the deed of trust. (Id. at ¶ 22.)

On February 9, 2022, One Key, with Maksim acting as “owner/manager,” made, executed, and delivered to Plaintiff a written promissory note in the sum of $100,000.00 (the “2/9/2022 note”). (Compl., ¶ 25 & Exh. L.) Maksim is the guarantor of the 2/9/2022 note. (Ibid.)

On February 11, 2023, the [2/9/2022] note was modified to lower the applicable interest rate and monthly payments due. (Compl., ¶ 26 & Exh. M.) [Note: The complaint appears to have typographical errors in the dates of this paragraph, as it refers to the “11/22/2021 Note,” but the exhibit appears to refer to the 2/9/2022 note. The Court will assume that Plaintiff is attempting to reference the 2/9/2022 note.] To secure payment on the 2/9/2022 note, One Key and Maksim made, executed, and delivered to Plaintiff, as beneficiary, a deed of trust, conveying to Fidelity National Title Company as trustee, the Original Secured Properties. (Id. at ¶ 27 & Exh. N.) Plaintiff is, and at all relevant to this action was, the lawful owner and holder of the 2/9/2022 note and holds a beneficial interest under the deed of trust. (Id. at ¶ 28.)

On March 1, 2024, One Key and Maksim failed to make payments on the 11/9/2021 note, the 11/22/2021 note, and the 2/9/2022 note. (Compl., ¶ 31.) As the result of this failure to make payments, the loans were restructured on July 11, 2024. (Id. at ¶ 32.)

On July 11, 2024, Anton made, executed and delivered to Plaintiff, and the Estate of Joseph A. Armel, a written promissory note titled “Four Year Promissory Note; 7% Interest Rate; Monthly Interest Only Payments; Balloon Payment” in the sum of $300,000.00 (the “7/11/2024 note”). (Compl., ¶ 33 & Exh. O.) Of the $300,000.00 provided by the note, $234,000.00 was proved by and payable to Plaintiff. (Ibid.) The $234,000.00 provided by Plaintiff was applied to the 11/9/2021 note, the 11/22/2021 note, and the 2/9/2022 note to pay down the principal on the 11/9/2021 note by $34,000.00, leaving $466,000.00 in principal due, to pay down the principal on the 11/22/2021 note by $100,000.00, leaving $500,000.00 in principal due, and to pay off the 2/9/2022 note with the remaining $100,000.00. (Id. at ¶ 34.)

On July 16, 2021, One Key and Maksim also made a $20,000.00 payment on the past due amounts on the 11/9/2021 note, the 11/22/2021 note, and the 2/9/2022 note as part of the restructuring. (Compl., ¶ 35.) Despite that payment, the three notes were not brought current and each had outstanding balances due immediately thereafter. (Ibid.) The outstanding balance on the 2/9/2022 note was applied to the 7/11/2024 note, which, in effect, refinanced and replaced the 2/9/2022 note. (Ibid.)

Also, as part of the restructuring, the State Property was reconveyed to One Key and removed as a security under each of the deeds of trust. (Compl., ¶ 36.)

To secure payment on the 7/11/2024 note, One Key, through Anton as “manager,” made, executed, and delivered to Plaintiff, as beneficiary, a deed of trust by the terms of which, One Key, as trustor, conveyed to Thyne Taylor Fox Howard LLP, as trustee, the Haley Property. (Compl., ¶ 37 & Exh. P.) Plaintiff is, and at all relevant to this action was, the lawful owner and holder of the 7/11/2024 note and holds a beneficial interest under the deed of trust. (Id. at ¶ 38.)

Beginning on July 13, 2024, One Key and Maksim have refused to pay and have defaulted on the 11/9/2021 note and the 11/22/2021 note. (Compl., ¶¶ 41, 42.) On July 12, 2024, Anton has refused to pay and has defaulted on the 7/11/2024 note. (Id. at ¶ 43.)

On June 24, 2025, Plaintiff filed a proof of service of summons and complaint on One Key at a UPS Store located at 315 Meigs Road, Suite A #417, Santa Barbara.

On August 6, 2025, Plaintiff filed a request for entry of default as to all three Defendants and the Court, believing that Maksim and Anton had been served, entered the default. Maksim and Anton had not yet been served at the time that their default was entered.

On August 12, 2025, prior to Maksim or Anton being served, but before their improperly entered defaults were set aside, Plaintiff moved ex parte for an order appointing a receiver, or, in the alternative, an order shortening time for hearing on noticed motion to appoint Kevin Singer as receiver.

On August 14, 2025, the Court granted the ex parte application and appointed Kevin Singer as receiver, with broad powers to manage the Pedregosa Property, the Transfer Property, the State Property, the Jennings Property, and the Haley Property.

On August 25, 2025, Defendants filed a notice of related case, identifying In re the Matter of the Revocable Trust of Joseph A. Armel (Marin County Case No. 25PR0000531). On September 2, 2025, Plaintiff filed an opposition to Defendants’ notice of related case. On September 10, 2025, the Court deemed that the cases should not be related.

Also on August 25, 2025, Defendants filed an ex parte application for: (1) order setting aside defaults, (2) order vacating appointment of receiver, (3) order relating cases, (4) order to stay litigation pending collateral action, and (5) order shortening time for motion for preliminary injunction.

On August 26, 2025, Defendants’ ex parte application was denied. In doing so, the Court noted: “This is not an appropriate ex parte motion; it is vastly too expansive and complicated for any thoughtful rulings.”

Also, on August 26, 2025: (1) the Court noted that Maksim and Anton were unserved at the time of the entry of their default and vacated the default as to them, and (2) the Court signed a stipulation and order that removed the State Property from the order appointing Kevin Singer as receiver.

On September 9, 2025, Maksim and Anton answered Plaintiff’s complaint with general denials and 11 affirmative defenses.

Also on September 9, 2025, One Key filed the present motion to set aside default, and Maksim and Anton filed the present motion for order to show cause why the ex parte order appointing receiver should not be vacated.

On October 29, 2025, Plaintiff filed oppositions to both motions, and receiver Singer filed opposition to the motion for order to show cause.

Analysis

Motion to Set Aside Default

One Key moves to set aside the August 6, 2025 default pursuant to Code of Civil Procedure section 473, subdivision (b).

“The Court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken. . . . Notwithstanding any other requirements of this section, the Court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney’s sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the Court finds that the default or dismissal was not in fact caused by the attorney’s mistake, inadvertence, surprise, or neglect.” (Code Civ. Proc., § 473, subd. (b).)

The trial Court has broad discretion to vacate the judgment and/or the clerk’s entry of default that preceded it.  However, “this discretion may be exercised only after the party seeking relief has shown that there is a proper ground for relief, and that the party has raised that ground in a procedurally proper manner, within any applicable time limits.” (Cruz v. Fagor America, Inc. (2007) 146 Cal.App.4th 488, 495.)

Unless the motion to set aside default is accompanied by an attorney affidavit of fault, which is not the case here, relief is discretionary, and the burden is on Defendant to demonstrate mistake, inadvertence, surprise, or excusable neglect. (See Lorenz v. Commercial Accept. Ins. Co. (1995) 40 Cal.App.4th 981, 989.) The party moving for relief on the basis of “mistake, inadvertence, surprise, or excusable neglect” must show specific facts demonstrating that one of these conditions was met. (Hopkins & Carley v. Gens (2011) 200 Cal.App.4th 1401, 1410.)

“The law favors judgments based on the merits, not procedural missteps. Our Supreme Court has repeatedly reminded us that in this area doubts must be resolved in favor of relief, with an order denying relief scrutinized more carefully than an order granting it. As Justice Mosk put it in Rappleyea, “ ‘Because the law favors disposing of cases on their merits, ‘ “any doubts in applying section 473 must be resolved in favor of the party seeking relief from default [citations]. Therefore, a trial Court order denying relief is scrutinized more carefully than an order permitting trial on the merits.” ’ [Citations.]” (Lasalle v. Vogel (2019) 36 Cal.App.5th 127, 134-135.)

 

By way of sworn declaration, Maksim declares:

“My Co-Defendant One Key LLC is a single member California Limited Liability Company of which I am the sole member.” (Maksim Decl., ¶ 2.)

“On November 11, 2024, I updated the Statement of Information for One Key LLC on the Secretary of State’s website and accidentally changed the Agent for Service of Process to myself using a UPS Store post office box that I have. I would not have done this if I understood the legal ramifications of an Agent for Service of Process. On August 22, 2025, I instructed Delfina Hall of Thyne Taylor Fox Howard, LLP to file a new Statement of Information appointing John J. Thyne II as the Agent for Service of Process for One Key LLC. Upon information and belief, Ms. Hall did so.” (Maksim Decl., ¶ 3.)

“The alleged service on One Key LLC did not result in actual notice of the Complaint.” (Maksim Decl., ¶ 4.)

A copy of the proposed answer is attached as Exhibit A to Maksim’s declaration. The proposed answer of One Key is substantially identical to the answers filed by Maksim and Anton.

There is no dispute that service of the complaint was effectuated at the address One Key listed with the Secretary of State and that service was procedurally correct. The question that must be addressed is whether One Key has met its burden under Code of Civil Procedure section 473, subdivision (b) of showing mistake, inadvertence, surprise, or excusable neglect for its failure to timely answer the complaint.

Plaintiff first argues that One Key, through Maksim and Maksim’s attorney, was aware of the lawsuit and was attempting to engage in “shenanigans” by evading service. While Plaintiff provides evidence of some unnecessary gamesmanship, for the Court to rely on this argument as a reason to deny the motion to set aside the default, the Court would be required to speculate as to the actual knowledge and intent of Maksim. Giving the moving party the benefit of the doubt, absent clear and indisputable evidence that One Key, through Maksim, was aware of the lawsuit and simply evading service, the Court is unwilling to deny the motion on these arguments alone.

Plaintiff next argues that because Maksim declared, “I would not have done this if I had understood the legal ramifications of an Agent for Service of Process,” One Key is admitting the failure to timely answer was due to ignorance of the law, and “as a matter of law, ignorance of the law is not a valid excuse in the context of applying Code of Civil Procedure Section 473.”

Plaintiff’s argument is both a mischaracterization of Maksim’s declaration and a misstatement of the law.

First, just because Maksim used the words “legal ramifications of an Agent for Service of Process,” does not necessary make Maksim’s excuse one based on ignorance of the law. The declaration, taken as a whole, and read in a logical manner, leads to the most reasonable conclusion that Maksim is claiming a mistake of fact rather than law. Maksim, in essence, declares that he accidently changed the agent for service of process. That is not a claim of ignorance of the law.

Even if the excuse was based on ignorance of the law, Plaintiff’s argument that that would bar relief under Code of Civil Procedure Section 473 is incorrect. In fact, the authority cited by Plaintiff does not stand for what Plaintiff claims, and the characterization of those cases is improperly misleading.

For example, Plaintiff argues: “it is well established under California law that ignorance of the law - as expressly claimed by Mr. Mironov - is not excusable neglect, mistake or inadvertence. (Harrison v. County of Del Norte (1985) 168 Cal.App.3d 1, 9.) “ ‘[A]ny alleged ignorance of legal matters or failure to properly represent [herself] can hardly constitute ‘mistake, inadvertence, surprise or excusable neglect’ as those terms are used in section 473.’ ” (Goodson v. The Bogerts, Inc. (1967) 252 Cal.App.2d 32, 40.)”

What Harrison v. County of Del Norte holds is:

“Excusable neglect is neglect which might have been the act or omission of a reasonably prudent person under the same or similar circumstances. [Citation.] Not every mistake of law is excusable. [Citation.] To determine whether a person is entitled to relief for a mistake of law, the controlling factor is the reasonableness of the misconception of the law under the circumstances of the particular case. [Citation.]” (Harrison v. County of Del Norte (1985) 168 Cal.App.3d 1, 7.) As can be seen, the case states almost the opposite of what Plaintiff claims it does.

Likewise, none of the other cases cited by Plaintiff stand for the proposition that ignorance of the law bars relief under Code of Civil Procedure Section 473. In fact, it has been established for over a hundred years that in certain circumstances mistakes of law are sufficient excuses to grant relief. “[T]he Court will, in a proper case, grant relief against a mistake of law, exercising the power given it under section 473 of the Code of Civil Procedure. ‘ “The language of this section does not limit the relief to mistakes of fact.” ’ [Citations.]” (Mitchell v. California & O.C.S.S. Co. (1909) 156 Cal. 576, 580.)

The Court will read Plaintiff’s argument to be that, to the extent Key One’s excuse is based on ignorance of the law, it is insufficient to grant relief, rather than it is a bar to relief. In the extremely unlikely event that the misstatement of the law was intentional, counsel is reminded of their ethical obligations of candor towards the Court. “Although counsel have broad discretion in discussing the legal and factual merits of a case [Citation], it is improper to misstate the law [Citation] . . .” (People v. Bell (1989) 49 Cal.3d 502, 538.)

Next, Plaintiff, while providing more in the way of detailed argument, essentially repeats his first argument regarding service being proper and One Key simply avoiding service. This argument is addressed above.

Plaintiff’s final argument is that Maksim is not credible. This argument is made in support of the proposition that the Court should exercise its discretion and deny the motion due to other acts of Maksim and his character. The Court does find this argument somewhat persuasive, but it does not overcome the appropriate weight the Court must give to the representations made, under penalty of perjury, in Maksim’s declaration.

The Court is satisfied that One Key has met its burden of establishing an excusable mistake in accidentally changing the agent of service of process to Maksim using a UPS Store post office box, and that the mistake led to One Key not receiving actual notice of the lawsuit within a sufficient time to respond to the complaint prior to the default being entered. In the interest of having this case decided on the merits, and a lack of a showing of prejudice by Plaintiff, the Court will grant the motion, and the default will be set aside. One Key will be ordered to separately file and serve its answer to Plaintiff’s complaint.

Motion for Order to Show Cause re Why Ex Parte Order Appointing Receiver Should Not be Vacated

A receiver may be appointed:

“In an action by a secured lender for the foreclosure of a deed of trust or mortgage and sale of property upon which there is a lien under a deed of trust or mortgage, where it appears that the property is in danger of being lost, removed, or materially injured, or that the condition of the deed of trust or mortgage has not been performed, and that the property is probably insufficient to discharge the deed of trust or mortgage debt. . . . In all other cases where necessary to preserve the property or rights of any party. . . . In a case brought by an assignee under an assignment of leases, rents, issues, or profits pursuant to subdivision (g) of Section 2938 of the Civil Code.” (Code of Civil Procedure section 564, subds. (b)(2), (b)(9), (b)(12).)

“California rigidly adheres to the principle that the power to appoint a receiver is a delicate one which is to be exercised sparingly and with caution. It is said by the state’s Courts that the appointment of a receiver is ‘ “an extraordinary and harsh,” ’ and ‘ “delicate,” ’ and ‘ “drastic,” ’ remedy to be used ‘ “cautiously and only where less onerous remedies would be inadequate or unavailable. . . .” ’ [Citations.] And a party to an action should not be ‘ “subjected to the onerous expense of a receiver, unless . . . his appointment is obviously necessary to the protection of the opposite party. . . .” ’ [Citation.]” (Morand v. Superior Court (1974) 38 Cal.App.3d 347, 351.)

“Due to the “ ‘extraordinary’ ” nature of this remedy and the special costs it imposes, Courts are strongly discouraged - although not strictly prohibited - from appointing a receiver unless the more intrusive oversight of a receiver is a “ ‘necessity’ ” because other, less intrusive remedies are either “ ‘ “inadequate or unavailable.” ’ ” [Citations.]” (Medipro Medical Staffing LLC v. Certified Nursing Registry, Inc. (2021) 60 Cal.App.5th 622, 628.)

As noted above, the order appointing Singer as receiver to manage Defendants’ property and imposing a temporary restraining order in support of the receiver, was granted by way of ex parte application prior to either Maksim or Anton being served. At that time, default had been improperly entered against Maksim and Anton and they had no notice of the hearing, nor did they have the opportunity to oppose the ex parte application.

By way of the present motion, Defendants represent that the promissory notes in this litigation are the same promissory notes at issue in the Marin County probate action, Case No. PR0000531. Defendants contend that in the Marin County case, Defendants’ mother asserts she was the registered domestic partner to decedent Joseph Armel, who was the original trustor and trustee of the Forge Trust Co. Joseph A. Armel Decedent CFBO Revocable Living Trust of Joseph Armel (Plaintiff in this action), and that she contributed funds to the Trust. Defendants’ mother seeks a Court ruling on the ownership of the Trust property including ownership of the Promissory Notes, and removal of Joshua Armel as trustee. This, Defendants claim, is their reason for not currently making payments on the note.

Defendants’ first argument is that Plaintiff lacked a sufficient basis for ex parte relief in the first place, by failing to make a showing of irreparable harm, immediate danger, or any other statutory basis for granting relief ex parte, as well as concealing material facts.

“A Court will not grant ex parte relief “ ‘in any but the plainest and most certain of cases.’ ” [Citation.] For this reason, the rules governing ex parte applications in civil cases require that “ ‘[a]n applicant . . . make an affirmative factual showing . . . of irreparable harm, immediate danger, or any other statutory basis for granting relief ex parte.’ ” [Citations.] A trial Court should deny an ex parte application absent the requisite showing. [Citation.]” (People ex rel. Allstate Ins. Co. v. Suh (2019) 37 Cal.App.5th 253, 257.)

The Court has reviewed Plaintiff’s declaration in support of the ex parte application and Defendants are correct that the Plaintiff did not make any declaration of fact that tends to show any real possibility of irreparable harm, immediate danger, or any other statutory basis for granting ex parte relief. A review of the argument contained in the ex parte application itself only shows that Plaintiff is concerned that: “Defendants are collecting proceeds from the Subject Properties and retaining said income proceeds. This rental income is the security pledged to the debt owed to the Plaintiff. By dissipating the income and using them for purposes other than paying down the debt, the Defendants are undermining the security pledge to the unfair detriment of Plaintiff” (Aug. 12, 2025, Ex Parte App., p. 3, ll. 7-11.); and “The exigency is that as time passes, and the Defendants continue to abscond with the rental income, there is more damage to Plaintiff as its security continues to be undermined. Moreover, there is a danger that waste could be committed at the Subject Properties if a receiver is not appointed.” (Id. at p. 3, ll. 20-24.) Other than speculation, and the mistaken belief at that time that Maksim and Anton were ignoring this lawsuit, Plaintiff did not adequately present facts that would lead to the conclusion that a receiver was necessary to preserve the property rights of Plaintiff, or that less intrusive measures could not be taken to protect any property rights of Plaintiff.

The Court’s granting of the ex parte application appointing the receiver was largely influenced by the, again mistaken, belief that all three parties had defaulted and that as a result of Defendants’ failure to participate in this lawsuit the receiver was necessary. The fact that the defaults were erroneously entered changes the analysis. Additionally, facts that were not before the Court when the ex parte was granted may have a substantial impact on the Court’s determination of the necessity of a receiver. Those alleged facts include the existence and nature of the probate action as well as the ownership of three of the subject properties lying with the individual Defendants rather than One Key.

Plaintiff contends, among other things, that the motion was not properly brought under the correct Code section and that the section that the motion was brought under does not allow the relief requested. While there is some validity to that argument, Defendants have demonstrated that they are likely entitled to some relief.

“ ‘The proposition that a trial Court may construe a motion bearing one label as a different type of motion is one that has existed for many decades. ‘ “The nature of a motion is determined by the nature of the relief sought, not by the label attached to it. The law is not a mere game of words.” ’ [Citation.] Neither the Legislature, nor the California Supreme Court, nor any Court of Appeal has ever challenged that notion. . . . The principle that a trial Court may consider a motion regardless of the label placed on it by a party is consistent with the Court’s inherent authority to manage and control its docket.’ ” (Austin v. Los Angeles Unified School Dist. (2016) 244 Cal.App.4th 918, 930.)

As this case has only recently been filed, now would be the time to get this matter back on the right path.

The Court will issue an order to show cause, to all parties, re the necessity of a receiver. The hearing will be set out far enough so that this Court can receive further information regarding the status of proceedings in the Marin Probate matter.

Pending further proceedings, the Court finds that it would be prudent to issue an interim order regarding the Receivership.

While the receiver will not be immediately discharged of his appointment, the scope of his powers will be reduced until further order of the Court.

Defendants state:

“Defendants could agree to pay the outstanding loan payments to the Court, or to a third-party escrow holder, pending resolution of the issue of who owns the Promissory Notes. Conversely, Defendants could post an undertaking securing payment of the outstanding and accruing loan payments pending resolution of the ownership issue.” (Motion, p. 10, ll. 6-9.)

The Court will order Defendants to pay the outstanding loan payments, and additional amounts as they become due, to the receiver, who shall treat the funds as receivership property. Upon receiving the initial payment, the receiver shall release possession and control of the subject properties to Defendants, including property assets, rents, revenue, etc. related thereto. Receiver, to the extent he has possession of any, shall also, upon receiving the initial payment, turn over to Defendants possession of all records, books of account, ledgers, and all other documents and papers pertaining to the operation of the properties. Receivership fees are, at least temporarily, to be paid from the loan payments, and are subject to allocation or reallocation at any later time by order of the Court. Defendants continue to be restrained from transferring, conveying, assigning, pledging, deeding, selling, renting, leasing, encumbering, changing ownership of, vesting title to, or otherwise disposing of the properties.

As it may be relevant to the present matter, and indeed may resolve the present matter, the parties will be ordered to provide status reports regarding the Marin Probate case forthwith and shortly before the hearing on the order to show cause.