Opinion
JOHN A. PERRY, ESQ., Law Offices ROBERT E. WEISS INCORPORATED, Covina, California, Attorneys for Plaintiff SAGE POINT LENDER SERVICES, LLC.
CAROLINE D. CIRAOLO, Acting Assistant Attorney General, AARON M. BAILEY, Trial Attorney, Tax Division U.S. Department of Justice, Washington, D.C. PAMELA PALMIERI, Roseville, California, Attorney for Pedro Trust, Sharon Kidd and Gary Kidd.
SHARON KIDD, Successor Trustee of PEDRO Trust.
STIPULATION TO LIEN PRIORITY, RELEASE OF LIABILITY, AND DISTRIBUTION OF DEPOSITED INTERPLEADED FUNDS; AND ORDER
MORRISON C. ENGLAND, Jr., Chief District Judge.
IT IS HEREBY STIPULATED AND AGREED by Plaintiff Sage Point Lender Services, LLC ("Sage Point"), the United States of America ("United States"), and Defendants Sharon Kidd, individually and in her capacity as Successor Trustee of the PEDRO Trust, and Gary Kidd (collectively referred to herein as "the Kidds") that:
1. Sage Point, a foreclosure trustee, filed this Interpleader action in Sacramento County Superior Court on December 17, 2014.
2. The Interpleader litigation was commenced to resolve conflicting demands for payment of the sum of $141, 794.32 (plus accrued interest, if any) (the "Surplus Funds"), which represents surplus proceeds from the May 28, 2014; foreclosure sale of real property located in the County of Alameda, State of California, commonly known as 1232 Oregon Street, Berkeley, CA 94702 (hereinafter the "Property") previously owned by decedent Shelvie Kidd.
3. The United States removed this matter from the Superior Court on January 22, 2015 pursuant to 28 U.S.C. §§ 1442(a)(1), 1444 and 28 U.S.C. § 2410 because it involves the collection of revenue and the United States' claims to enforce its federal tax liens against codefendant and claimant Gary Kidd.
4. Following the removal to this Court, Sage Point caused the Surplus Funds to be deposited with the Court registry on March 24, 2015.
5. Defendants Gary Kidd and Sharon Kidd were named as defendants in this matter based on their status as heir and claimants to the property of Shelvie Kidd.
6. The Kidds have each asserted a claim to 50% of the funds at issue in this matter.
7. The United States has asserted a claim to a portion of the proceeds based upon its rights under the Federal Tax Lien Act and Internal Revenue Code allowing it to collect the "property and rights to property" of Gary Kidd in satisfaction of certain federal individual income tax liabilities. See Rec. Doc. 5.
8. Sharon Kidd asserts herself as the Successor Trustee of the PEDRO TRUST. A true and correct copy of a Certification of Trust, made pursuant to California Probate Code Section 18100.5 and executed by Sharon Kidd attesting to her status as Successor Trustee of the PEDRO Trust, is attached hereto as Exhibit "1".
9. The PEDRO Trust, through its Successor Trustee, Sharon Kidd, hereby disclaims any interest in the deposited Surplus Funds and releases its prior claim thereto. The PEDRO Trust hereby consents to the disbursement of the Surplus Funds in accordance with Paragraph 13 herein below.
10. After due consideration, the parties have stipulated and agreed to a release of liability between Sage Point and the Kidds and to the priority of various claims and distribution of the Surplus Funds currently deposited in the registry of the Court.
11. Sage Point and the Kidds, including Sharon Kidd (both individually and in her capacity as Successor Trustee of the PEDRO Trust) and Gary Kidd, on behalf of themselves, their descendants, ancestors, dependents, heirs, executors, administrators, directors, officers, assigns, agents, employees, representatives, attorneys, affiliates and successors hereby release and discharge the other party and that parties' descendants, ancestors, dependents, heirs, executors, administrators, directors, officers, assigns, agents, employees, representatives, attorneys, affiliates and successors from all rights, claims and actions which each party and the above-mentioned successors now have against the other party and the above-named successors, stemming from their differences described in the underlying Complaint in Interpleader hereof; provided, however, nothing in this Agreement shall release, waive, modify or effect Sage Point and/or the Kidds' obligations pursuant to the terms contained in this Stipulation.
12.
A. Sage Point and the Kidds acknowledge and agree that the release they give to the other party upon executing this Agreement applies to all claims for injuries, damages, or losses to their own person and property, real or personal (whether those injuries, damages, or losses are known or unknown, foreseen or unforeseen, patent or latent) which that party may have against the other party arising from or in conjunction with the distribution of the Surplus Funds that are issue in the above-captioned Interpleader litigation. Sage Point and the Kidds hereby waive application of California Civil Code § 1542.
B. Sage Point and the Kidds certify that they have read and understood the following provisions of California Civil Code § 1542:
"A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release which if known by him or her must have materially affected his or her settlement with the debtor."
C. Sage Point and the Kidds understand and acknowledge that the significance and consequence of this waiver of California Civil Code § 1542 is that even any of the said parties should eventually suffer additional damages arising out of the facts referred to in the Complaint in Interpleader, that party will not be able to make any claim for those damages. Furthermore, said parties acknowledge that they consciously intend these consequences even as to claims for damages that may exist as of the date of this release but which that party does not know exists, and which, if known, would materially affect that party's decision to execute this release, regardless of whether that party's lack of knowledge is the result of ignorance, oversight, error, negligence, or any other cause. However, nothing in this Stipulation shall release, waive, modify or effect each party's obligations pursuant to the terms contained herein.
13. The parties request an Order directing the Clerk to distribute the funds on deposit with the Court registry in this case as follows:
a. First, Sage Point shall receive the sum of $15, 989.99 for attorney's fees and costs incurred in the investigation of the priority and claims to the Surplus Funds and incurred bringing this Interpleader litigation, made payable as follows:
b. Second, by check made payable to the "United States Treasury, " in the amount of $28, 624.43 with the name "Gary Kidd" and the case number indicated in the memo line, mailed to:
c. Third, Sharon Kidd shall receive the sum of $63, 544.18 in satisfaction of her claim as heir of Shelvie Kidd, made payable as follows:
d. Fourth, Gary Kidd shall receive the sum of $33, 635.72 in satisfaction of his claim as heir of Shelvie Kidd, made payable as follows:
e. Fifth, accrued interest on the deposited Surplus Funds, if any, shall be disbursed equally to Sharon Kidd and Gary Kidd, made payable as follows:
f. Distribution in this manner is intended to exhaust the funds on deposit the with the Court registry.
13. This Stipulation is intended by the parties to resolve the entirety of the above-captioned Interpleader litigation.
THE COURT, having reviewed the foregoing Stipulation, and good cause appearing,
IT IS SO ORDERED.