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Shady Tree Farms v. Omni Financial

May 22, 2012

SHADY TREE FARMS, PLAINTIFF AND APPELLANT,
v.
OMNI FINANCIAL, DEFENDANT AND RESPONDENT.



APPEAL from a judgment of the Superior Court of Fresno County. Donald S. Black, Judge. (Super. Ct. No. 09CECG01170)

The opinion of the court was delivered by: Levy, Acting P.J.

CERTIFIED FOR PUBLICATION

OPINION

Appellant, Shady Tree Farms, LLC (Shady Tree), delivered mature trees for the landscaping of a development known as Granite Park. When Shady Tree did not receive payment, Shady Tree recorded a materialman's lien.

In this appeal, Shady Tree challenges the judgment on the pleadings entered in favor of respondent, Omni Financial, LLC (Omni) on Shady Tree's complaint to foreclose on its materialman's lien. Shady Tree argues the trial court erred in finding that Shady Tree's failure to serve a preliminary 20-day notice under Civil Code*fn1 section 3097 prevented it from foreclosing on the lien.

The trial court correctly granted Omni's motion for judgment on the pleadings. Accordingly, the judgment will be affirmed.

BACKGROUND

The Granite Park development covered several acres of property and was to be filled with a sports complex, restaurants and entertainment for all ages. The entities developing Granite Park were the Zone Sports Center, LLC (Zone), Granite Park Kids' Foundation (Foundation), JEG Ventures, LLC (JEG), and High Speed Development, LLC.

Omni provided an $18 million construction loan to the Zone that was secured by a deed of trust on the properties owned by the Zone. Omni recorded the deed of trust in January 2006. Omni recorded a modification to this deed of trust in March 2007.

Shady Tree is in the business of growing and selling mature trees for landscaping. On August 11, 2008, Shady Tree entered into a contract with JEG to sell trees to the owners of Granite Park. Shady Tree agreed to deliver 1,879 trees for a price of approximately $3.2 million.

Between August 12, 2008 and November 10, 2008, Shady Tree delivered 959 trees to the Granite Park development. A landscaping company immediately planted 47 of these trees and the remaining trees were placed around the development for planting at a later date. The Granite Park entities assumed ownership and responsibility for the trees but failed to care for them. Eventually, all of the trees died.

Except for a $25,000 deposit, Shady Tree was not paid for the trees. On February 3, 2009, Shady Tree recorded a materialman's lien against JEG, the Zone and the Foundation seeking to recover the balance due of $1,959,244.50 plus interest from September 1, 2008.

On April 2, 2009, Shady Tree filed the underlying action to enforce its materialman's lien. Shady Tree further requested a declaration that its materialman's lien had priority over Omni's deed of trust. Shady Tree also sought to enjoin Omni from foreclosing on its deed of trust pending resolution of the priority issue.

In February 2009, Omni recorded a notice of default against the Zone asserting that the Zone owed Omni over $21 million. In June 2009, Omni foreclosed and ...


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