DeBerard Properties, Ltd. v. Bun Raymond Lim, et al.
Published: Aug. 21, 1999 | Result Date: Jul. 3, 1999 | Filing Date: Jan. 1, 1900 |Case number: S070347 Verdict – $0
Judge
Court
L.A. Superior San Fernando
Attorneys
Plaintiff
Defendant
Paul T. Suzuki
(ADR Services, Inc.)
Facts
In 1990, Myo Za Theresa Lim and Bun Raymond Lim agreed to buy a shopping center from DeBerard Properties, Ltd., for $3.2 million. The Lims tendered a $1,120,000 downpayment, assumed a first trust deed securing an obligation of $1,913,266.92 held by a bank, and signed a promissory note for $170,000 secured by a second trust deed in favor of DeBerard. By September 1993, the Lims could no longer make payments on the obligations secured by the first and second trust deeds. The Lims hired an accountant to renegotiate their obligations to the holders of the trust deeds. The accountant renegotiated both obligations. As a result, the parties to this case executed a forbearance agreement. The agreement halved the monthly payments from $1,416.67 to $708.33 and the interest rate from 10 to 15 percent. Also, DeBerard agreed not to foreclose, and it agreed to subordinate its trust deed to any modification of the bank loan, in order to facilitate the Lims' renegotiation with the bank. In turn, the Lims waived the protection provided by º580b. Despite these changes, the Lims soon defaulted on their obligations to the bank and DeBerard. The bank foreclosed and extinguished DeBerard's junior security interest. DeBerard then filed suit on the promissory note. In a bench trial, the court concluded that º580b may be waived as a matter of law and found that the Lims had voluntarily, knowingly and intelligently waived it. The court awarded DeBerard $241,075.81 plus costs. The Court of Appeal reversed and the Supreme Court affirmed. It concluded that º580b's language precluded its protection from being waived. Per the defendant, the Court of Appeal decision was affirmed by the California Supreme Court; that C.C.P. º580(b) cannot be waived.
Settlement Discussions
The plaintiff made a demand of $_____________. The defendants offered $150,000 before decision of Supreme Court.
Other Information
The defendant owed attorney plus interest of approximately $300,000.
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