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Contracts
Breach of Contract
Wrongful foreclosure

Murrieta Car Wash v. North County Bank

Published: Sep. 8, 2004 | Result Date: May 12, 2004 | Filing Date: Jan. 1, 1900 |

Case number: 808476 Verdict –  $6,724,000

Judge

Steven L. Perk

Court

Orange Superior


Attorneys

Plaintiff

Charles L. Kreindler

Douglas B. Vanderpool
(The Vanderpool Law Firm)


Defendant

Andrew J. Guilford
(Judicate West)

Matthew J. Erwin


Experts

Plaintiff

Roger Doverspike
(technical)

Brian P. Brinig
(technical)

Defendant

Robert Knudsen
(technical)

Patrick G. Shea
(Law Office of Patrick G. Shea APC) (technical)

Robert A. Steele
(technical)

Facts

This was a re-trial on the issue of damages only. In 1995, the plaintiff, Murietta Car Wash, purchased a prime corner parcel in the City of Murrieta, with the plan to open a state of the art service station, car wash, convenience store and detail center. After two years of planning (including entering into a 10-year branding agreement with Chevron), Murietta Car Wash approached North County Bank for a construction loan. The bank agreed to a $1.57 million construction loan which closed on April 29, 1997. However, after closing escrow and recording a first trust deed against the property, the bank refused to release the vouchers to fund the construction loan. Moreover, although the loan included six months of interest payments, the bank required immediate payments from Murietta Car Wash. Ultimately, North County Bank foreclosed on the property, purchased the property at foreclosure and built its new bank branch on the property. Wells Fargo later acquired North County Bank.

Settlement Discussions

In August 2000, before the previous trial, the plaintiff made a C.C.P. Section 998 demand of $350,000; there was no offer from the defendant. In March 2004, the defendant made successive C.C.P. Section 998 offers of $501,000 and $901,000 respectively. The plaintiff countered at $8 million. During trial, the defendant raised its offer to $2 million.

Damages

The plaintiff claimed damages of over $14 million, relating to the value of the real estate lost in the foreclosure; lost rental income to date; loss of business value and lost past profits to date.

Other Information

This was a retrial of damages only. In October 2000, the plaintiff obtained a jury verdict of $4,999,000. The trial court granted the defendant's motions for judgment notwithstanding the verdict and new trial on liability and damages. The plaintiff appealed and the appellate court reversed the judgment notwithstanding the verdict rulings, upheld the liability findings against the bank and remanded the case back for retrial on damages only. The plaintiff was previously awarded $206,314 in appellate fees and costs. On June 4, 2004, the court awarded to plaintiffs an additional $387,900 in attorney fees for the damages re-trial against Wells Fargo. On July 12, 2004, the court denied Wells Fargo's motion for new trial and judgment notwithstanding the verdict. The court partially granted Well Fargo's motion to tax costs and awarded costs for the damages re-trial in the amount of $76,164. Two of Murrieta Car Wash's principals also received a jury verdict in October 2000 of $45,000, which was already been paid by Wells Fargo. The principals were also awarded $300,000 in attorney fees for the first trial, which has not yet been paid by Wells Fargo, and is currently on appeal. The total amount of the judgment against Wells Fargo in this case is now $7,739,448.

Deliberation

five hours

Poll

12-0 (damages), 9-3 (amount)

Length

11 days


#98046

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