United States District Court, S.D. California
DAVID R. RUBY, Trustee, Plaintiff,
v.
HELEN E. RYAN and JOHN J. RYAN, JR., Defendant.
ORDER ADOPTING IN PART REPORT AND RECOMMENDATION
DENYING MOTION FOR ORDER DETERMINING CLAIM OF EXEMPTION AND
MOTION TO QUASH GARNISHMENT [ECF NO. 33.] [ECF NO.
17.]
Hon.
Gonzalo P. Curiel United States District Judge
INTRODUCTION
On
August 12, 2013, the United States District Court for the
Eastern District of Virginia entered a default judgment in
favor of David Ruby (“Plaintiff” or
“Judgment Creditor”), Chapter 7 Trustee, in the
amount of $34, 093.08 against Helen Ryan and John Ryan, Jr.
(“Judgment Debtors”), jointly and severally, and
in the amount of $318, 431.23 against Helen E. Ryan,
individually. (ECF No. 1 at 1-2; ECF No. 2 at 1; see
also ECF No. 27 at 1.) On September 16, 2015, Judgment
Debtor registered the judgment in this district and
subsequently sought to execute on the judgment. (ECF Nos. 1,
6, 7, 8, 9.) On November 3, 2015, Helen Ryan and Mykal Ryan,
acting as Special Administrator for the Estate of John Ryan
(“Mykal Ryan, Special Administrator”), proceeding
pro se, submitted a claim of exemption. (ECF No.
17-2, Ex. 2 at 2-3.) On November 5, 2015, Helen Ryan and
Mykal Ryan, Special Administrator, filed a Motion to Quash
Garnishment/Execution and Claim Exemption (“Motion to
Quash”). (ECF No. 17.) On March 21, 2016, the
Magistrate Judge filed a Report and Recommendation denying
relief sought by Judgment Debtors. (ECF No. 33.)
Upon
review of the moving papers, the Magistrate Judge’s
Report and Recommendation, the papers filed in response to
the Report and Recommendation, and the applicable law, this
Court ADOPTS in part the recommendation of the Magistrate
Judge and DENIES Helen Ryan’s claim of exemption, (ECF
No. 17-2, Ex. 2 at 3), DENIES Mykal Ryan, Special
Administrator’s, Motion to Quash, and GRANTS in part
and DENIES in part Helen Ryan’s Motion to Quash. (ECF
No. 17).
PROCEDURAL
HISTORY
I.
Writ of Execution Against Judgment Debtors Helen Ryan and
John Ryan
On
September 29, 2015, and October 2, 2015, Judgment Creditor
requested abstracts of judgment, which the Court subsequently
entered against Judgment Debtors. (ECF Nos. 4, 5, 8, 9.) On
September 29, 2015, and October 2, 2015, Judgment Creditor
filed writs of execution against Judgment Debtor Helen Ryan.
(ECF Nos. 3, 7.) On October 28, 2015, Judgment Creditor filed
a notice of levy for “[a]ll bank accounts owned by
Helen E. Ryan and/or John J. Ryan, Jr.” (ECF No. 17-2,
Ex. 1 at 2.)
On
November 3, 2015, Helen Ryan and Mykal Ryan, Special
Administrator, proceeding pro se, submitted a claim
of exemption. (ECF No. 17-2, Ex. 2 at 2-3.) On November 4,
2015, U.S. Bank levied $99, 622.73, as well as a $100.00
garnishment fee, from Helen Ryan’s U.S. Bank account
ending in 4226 (“U.S. Bank account x4226”). (ECF
No. 25; ECF No. 27, Ex. 4 at 50; see also id., Ex.
4, Decl. of Helen Ryan I at 8-10; id., Ex. 5, Decl.
of Helen Ryan II at 53.) On November 5, 2015, Mykal Ryan,
Special Administrator, and Helen Ryan filed a Motion to
Quash. (ECF No. 17.) On November 9, 2015, Helen Ryan
submitted an amended claim of exemption. (ECF No. 27, Ex. 5.)
On
November 16, 2015, Judgment Creditor filed a “Response
in Opposition Re: Objection to Claim of Exemption, ”
(ECF No. 21), and on November 17, 2015, a “Response in
Opposition Re: Motion to Quash Garnishment/Execution, ”
(ECF No. 23). On November 20, 2015, Judgment Creditor filed a
“Memorandum of Points and Authorities in Opposition to
Claim of Exemption Re: U.S. Bank Funds.” (ECF No. 26.)
On November 30, 2015, Helen Ryan filed a “Reply in
Response to the Motion to Quash; Opposition to Garnishment of
Money from Other than the Judgment Debtor.” (ECF No.
27.) On December 4, 2015, a “Memorandum of
Garnishee” was filed with this Court, detailing that
“no funds were available” in the levied Bank of
America account, Helen Ryan’s Bank of America account
ending in x0912 (“Bank of America account
x0912”). (ECF No. 30.) On February 5, 2016, Helen Ryan
filed an “Opposition to Garnishment of Money from Other
than the Judgment Debtor.” (ECF No. 32.)
On
March 21, 2016, the Magistrate Judge filed a Report and
Recommendation denying relief sought by Judgment Debtors.
(ECF No. 33.) The Magistrate Judge recommends that this Court
enter an Order: (1) approving and adopting the Report and
Recommendation; and (2) denying the movants’ requests
to (a) release the funds levied from Helen Ryan’s U.S.
Bank account x4226; (b) reimburse the $100.00 garnishment fee
to Helen Ryan’s U.S. Bank account x4226; and (c) quash
Judgment Creditor’s garnishment actions against Helen
Ryan and the Estate of John Ryan. (Id. at 20.)
On May
27, 2016, now with counsel, Helen Ryan filed an Objection to
Report and Recommendation. (ECF No. 38.) Mykal Ryan, Special
Administrator, did not file an Objection. In her Objection,
Helen Ryan objects to two specific actions: (1) she contends
that “allowing [Judgment Creditor] to retain the funds
levied from [U.S Bank account] ¶ 4226 would improperly
allow Judgment Creditor a greater right to the property than
Judgment Debtor”; and (2) that “the funds in
Helen Ryan’s Bank of America [] account x0912 have been
and will remain exempt from creditors.” (Id.
at 4-5.)
On that
same day, May 27, 2016, Mykal Ryan, now with counsel, filed a
Third Party Motion for a Third Party Claim of Exemption
(“Third Party Motion”) as to funds levied from
U.S. Bank account x4226. (ECF No. 39.) Mykal Ryan’s
Third Party Motion endeavors to correct the deficiencies
noted by the Magistrate Judge in Helen Ryan’s improper
claim of exemption regarding U.S. Bank account x4226.
The
Magistrate Judge recommends that this Court deny Judgment
Debtor Helen Ryan’s claim of exemption regarding U.S.
Bank account x4226 because it constitutes an improper third
party claim.[1] Helen Ryan asserts that “[a]ll the
money deposited” to U.S. Bank account x4226
“belongs to [] Mykal (aka) Michael Ryan, ”
“the judgment is not against Mykal, ” and
“[a]ll the deposits were federal benefits paid to
Mykal.” (ECF No. 27, Ex. 5 at 54; see also Id.
at 52.)
Because
Judgment Debtors concede that Helen Ryan’s claim of
exemption is improper, demonstrated by Mykal Ryan’s
filing of a Third Party Claim of Exemption concerning the
same account (U.S. Bank account x4226), the Court
ADOPTS the Magistrate Judge’s Report
and Recommendation denying Helen Ryan’s claim ...