JMJ Financial Group v. Hewko



























Filed 6/7/13 JMJ Financial Group v. Hewko CA4/3CA4/3













>NOT TO BE PUBLISHED IN OFFICIAL REPORTS





California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
relying on opinions not certified for publication or ordered published, except
as specified by rule 8.1115(b). This
opinion has not been certified for publication or ordered published for
purposes of rule 8.1115.







IN THE COURT OF
APPEAL OF THE STATE OF CALIFORNIA



FOURTH APPELLATE
DISTRICT



DIVISION THREE




>

JMJ FINANCIAL GROUP, Plaintiff and Respondent, v. THOMAS HEWKO et al., Defendants and Appellants.

G046708 (Super. Ct. No. 30-2011-00510117) O P I N I O N

Appeal from orders of
the Superior Court
of href="http://www.adrservices.org/neutrals/frederick-mandabach.php">Orange
County, Gregory H. Lewis, Judge. Affirmed.

Thomas Hewko and Denise
Honc, in pro. per., for Defendants and Appellants.

Law Office of Julian Bach
and Julian Bach for Plaintiff and Respondent.

* * *



Plaintiff and respondent
JMJ Financial Grouphref="#_ftn1" name="_ftnref1"
title="">[1]
commenced foreclosure proceedings with respect to the multi-unit rental
property of defendant and appellant Thomas Hewko. Hewko sought the assistance of defendants
Denise Honc, Boyan Panajotov, and notary public Rita P. Thomas to gum up the
works and delay the foreclosure. Hewko
claims to have tendered payment of all sums due on his loan by delivering to
JMJ Financial Group a “private registered setoff bond” in the amount of
$1,150,000, issued by himself as underwriter, for the credit of JMJ Financial
Group, and payable to the order of the United
States Treasury, which was authorized to demand payment by presentment to
Secretary of the Treasury Timothy F. Geithner.
Hewko and the other defendants, via their respective participation,
signed, notarized and/or recorded, a variety of other documents including a
reconveyance of all interests under the deed of trust of JMJ Financial Group.

JMJ
Financial Group filed a lawsuit and obtained the appointment of a receiver with
respect to Hewko’s property. Hewko and
Honc, each appearing in propria persona, appeal from the order appointing a
receiver and from an order denying a motion for reconsideration.href="#_ftn2" name="_ftnref2" title="">[2] They have failed to meet their burden to show
that the court erred in granting the application to appoint a receiver. In addition, because they have failed to
provide any argument in support of their appeal from the order denying the
motion for reconsideration, they have abandoned any challenge to that
order. We affirm.







I

FACTS

>A.
Introduction:

Hewko and Honc have
filed a limited record on appeal. The
clerk’s transcript does not contain a copy of the complaint, a copy of the
application to appoint a receiver, or for that matter, a copy of any pleading
whatsoever filed by JMJ Financial Group.
Furthermore, Hewko and Honc provide extraordinarily few record
references in their brief.

“[T]he failure to provide citation
to the record is a violation of California Rules of Court, rule
[8.204(a)]. A violation of the rules of
court may result in the striking of the offending document, the waiver of the
arguments made therein, the imposition of fines and/or the dismissal of the
appeal. [Citations.] In addition, it is [a party’s] duty to point
out portions of the record that support the position taken on appeal. The appellate court is not required to search
the record on its own seeking error.
Again, any point raised that lacks citation may, in this court’s
discretion, be deemed waived.
[Citation.]” (>Del Real v. City of >Riverside> (2002) 95 Cal.App.4th 761, 768.)

Because of the limited record on
appeal, and Hewko and Honc’s limited record references, we provide below a
synopsis of each party’s representations concerning the facts. We do not accept any of these representations
as true, but we consider the representations to enable us to better understand
each party’s position. Also, while we
are not required to scour the record on our own, we have nonetheless chosen to
take a look at it and see what support it may contain for the arguments that
Hewko and Honc raise. Having done so, we
also note below certain documents of interest that we located in the clerk’s
transcript.





>B.
Appellants’ Representations:

The following
representations are contained in the opening brief of Hewko and Honc:

Hewko
owns a multi-unit rental property located on Shalimar
Drive in Costa Mesa. It is subject to a deed of trust in favor of
JMJ Financial Group. JMJ Financial Group
claims to be owed $388,288.54. The
property value is about $800,000, so Hewko has about $400,000 in equity in the
property.

Hewko
tendered the entire amount owing to JMJ Financial Group. JMJ Financial Group received and “kept” the
tender, but failed to adjust its books and records to reflect a zero balance
due under the loan and failed to execute a reconveyance. Even though the tender had the effect of
extinguishing the lien of the deed of trust, the court appointed a receiver to
collect the rents on the property.



C. Respondent’s Representations:

The
following representations are contained in the respondent’s brief of JMJ
Financial Group:

Hewko
borrowed $344,000 from JMJ Financial Group, secured by a deed of trust against
Hewko’s multi-unit residential property located on Shalimar
Drive in Costa Mesa. JMJ Financial Group commenced foreclosure
proceedings, but Hewko filed for bankruptcy, and obtained a stay of the foreclosure
proceedings. While the stay was in
effect, “Honc, who is not a party to the loan transaction . . . but is rather
an officious intermeddler who along with her other cohorts seeks out borrowers
with distressed real estate, began recording false and fraudulent documents
against the subject property.”

Those
fraudulent documents included a modification of deed of trust, an assignment of
deed of trust, a full reconveyance, and a notice of rescission of declaration
of default and demand for sale.
Panajotov, who executed certain of the documents, has never been
employed by, has never been affiliated with, and has never been authorized to
sign any documents on behalf of, either JMJ Financial Group or RESS Financial,
a company identified in Panajotov’s documentation as an agent for the
beneficiary and trustee under the deed of trust. Likewise, Honc was not authorized to sign any
documents on behalf of JMJ Financial Group and, in particular, was not
authorized to reconvey the deed of trust.

After
the bankruptcy proceedings were
dismissed, JMJ Financial Group filed a first amended complaint against Hewko,
Honc, and others, for: (1) slander of
title; (2) fraud; (3) cancellation of written instruments; (4) breach of statutory
duties by a notary public; (5) judicial foreclosure; (6) specific performance
of deed of trust; (7) injunctive relief; and (8) declaratory relief.

The
court granted JMJ Financial Group’s application for the appointment of a
receiver and denied the motion for reconsideration filed by Hewko and Honc.



D. Clerk’s
Transcript—Appellants’ Exhibits:

Honc
filed a “NOTICE TO INCLUDE AND AUGMENT THE RECORD” in the trial court. Copies of the following documents, among
others, were attached as exhibits:

1. A “PRIVATE REGISTERED SETOFF BOND” in the
amount of $1,150,000, reflecting an issue date of July 14, 2011. It
is payable to the order of the United States Treasury, for credit to JMJ
Financial Group, Inc., through Thomas Michael Hewko, as principal and
creditor. The bond is signed by “Thomas
Michael Hewko, Principal/Underwriter.”

According
to the terms of the document, the United States Treasury, as payee, “may demand
payment of all or any portion hereof at its discretion by posting the payment
to the Private Offset Account” of Hewko “and transferring the obligation by
TT&L or presentment to” Secretary of the Treasury Timothy F. Geithner. No later than one business day after
presentment, the United States Treasury as payee shall “post the full or partial
value of this bond to satisfy . . . any and all . . . debts . . . attributed to
the Account Holders and Accounts above-noted.”
The two accounts referenced at the top of the bond are the account of
JMJ Financial Group, Inc. and the private offset account of Hewko.

2. A “NOTICE OF TENDER FOR SETOFF” dated July 14, 2011 from Hewko to JMJ
Financial Group, Inc. and RESS Financial Corp.
Hewko claimed to have tendered a “setoff” and requested that his account
be adjusted to zero, “to reflect the ledgering of said TENDER.”

3. A July
7, 2011 letter from JMJ Funding Group, Inc., demanding $381,026.86
by July 28, 2011 for payoff
of the loan. The following words were
stamped across the face of the demand:
“ACCEPTED FOR VALUE — RETURNED FOR VALUE EXEMPT FROM LEVY — PREPAID
COMMON STOCK DISCHARGE ALL PRESENTATIONS AND RELATED FEES ADJUST THE BALANCE TO
ZERO PRIVATE PREPAID TREASURY EXEMPTION # 555041809 AND CHARGE THE SAME TO
THOMAS M. HEWKO 555-04-1809.” Below this
wording was the signature of Hewko, and the date July 14, 2011.

4. A July 14, 2011 “REQUEST REGARDING A
STATEMENT OF ACCOUNT” from Hewko to JMJ Funding Group, Inc. and RESS Financial
Corp. requesting they correct his statement of account to show a zero balance.

5. An August 2, 2011 “NOTICE OF FAULT IN
DISHONOR” whereby Hewko claimed that because Thomas, on his behalf, had
tendered the “PRIVATE REGISTERED SETOFF BOND” to JMJ Financial Group, Inc., and
JMJ Financial Group, Inc. had neither protested nor honored the tender, the
bond had been deemed dishonored, the debt had been discharged, and “a
confession of judgment on the merits [was] warranted.” Hewko’s signature on the notice was notarized
by Thomas.

6. An August 15, 2011 “NOTICE OF DEFAULT IN
DISHONOR CONSENT TO JUDGMENT” in which Hewko claimed that JMJ Financial Group,
Inc.’s “failure to perform by the terms of the Presentment constitute[d] [its]
acceptance and approval of the granting and conveying of a Full Power of
Attorney to [him] to perform the duties of [JMJ Financial Group, Inc.] stipulated
therein.” He also claimed the failure to
perform constituted JMJ Financial Group, Inc.’s “agreement to the stipulated
aggregate amount of unpaid obligations being Zero . . . .” Hewko’s signature on the document was again
notarized by Thomas.

7. A “NOTARY CERTIFICATION OF
NON-RESPONSE/NON-PERFORMANCE,” dated August
15, 2011, executed by Thomas and bearing her notarial seal. In that document Thomas declared, inter alia,
that: (1) she had presented the “PRIVATE
REGISTERED SETOFF BOND,” the “Request Regarding a Statement of Account,” and
the “NOTICE OF FAULT IN DISHONOR” upon JMJ Financial Group, Inc.; (2) JMJ
Financial Group, Inc. had refused to adjust Hewko’s statement of account
through “non-response/non-performance;” and (3) she thereupon “[did] publicly
and solemnly certify the dishonor as against all parties it [might] concern . .
. .”

8. A special power of attorney, dated August 16, 2011 and recorded in the
official records of the Orange County, California Clerk-Recorder on August 23, 2011, as instrument No.
2011000415433. By that special power of
attorney, Hewko appointed Panajotov his attorney in fact, empowered to take
certain acts with respect to the property on Shalimar in Costa
Mesa. The power
of attorney was notarized by Thomas.

9. A modification of deed of trust, executed on August 16, 2011 by Panajotov
purportedly on behalf of JMJ Financial Group, Inc. and recorded in the official
records of the Orange County, California Clerk-Recorder on August 23, 2011, as instrument No. 2011000415541. The document recited that the $344,000
promissory note, payable by Hewko to JMJ Funding Group, Inc. and secured by a
deed of trust against the Shalimar property was thereby modified to reflect a
zero balance. The document was notarized
by Thomas.

10. An assignment of deed of trust dated August 16, 2011 and recorded in the
official records of the Orange County, California Clerk-Recorder on August 23, 2011, as instrument No.
2011000415542. Pursuant to that
document, Panajotov, purportedly on behalf of JMJ Financial Group, did assign
to Honc the beneficial interest under a certain deed of trust executed by Hewko
in favor of JMJ Financial Group and recorded against the property on Shalimar
in Costa Mesa. The assignment was
notarized by Thomas.

11. A substitution of trustee, dated August 16,
2011 and recorded in the official records of the Orange County, California
Clerk-Recorder on August 23, 2011, as instrument No. 2011000415543. By that document, Panajotov, purportedly on
behalf of JMJ Financial Group, Inc. did substitute Honc as trustee under JMJ
Financial Group, Inc.’s deed of trust.
The document was notarized by Thomas.

12. A full reconveyance, dated August 16, 2011
and recorded in the official records of the Orange County, California Clerk-Recorder
on August 23, 2011, as instrument No. 2011000415544. By that document, Honc, as substitute trustee
of JMJ Financial Group, Inc.’s deed of trust against the Shalimar property in
Costa Mesa, reconveyed all right, title and interest of the trustee under that
deed of trust. The document was
notarized by Thomas.

13. A notice of rescission of declaration of
default and demand for sale, dated August 16, 2011 and recorded in the official
records of the Orange County, California Clerk-Recorder on August 23, 2011, as
instrument No. 2011000415931. By that
document, Panajotov, purportedly on behalf of RESS Financial Corporation,
rescinded a declaration of default and demand for sale previously recorded with
respect to the deed of trust of JMJ Financial Group. The document was notarized by Thomas.

14. A “CERTIFICATE OF ADMINISTRATIVE JUDGMENT”
dated September 2, 2011, signed by Thomas and bearing her notarial seal. In that certificate, Thomas declared that she
had, at the request of Hewko, presented a “NOTICE OF DEFAULT IN DISHONOR,
CONSENT TO JUDGMENT” to JMJ Financial Group, Inc., which contained a request
for consent to administrative judgment, that a reasonable time had lapsed
without response, and that she did therefore “publicly and solemnly certify the
consent of all parties” to an administrative judgment. She further declared that she had sent a
notice of administrative judgment to JMJ Financial Group, Inc. on September 2,
2011.



E. Clerk’s Transcript—Orders:

The
clerk’s transcript also contains a copy of a minute order dated January 30,
2012. It indicates that the plaintiff is
JMJ Financial Group and that defendants include Hewko, Honc and Panajotov.

The
court granted the request of JMJ Financial Group for the appointment of a
receiver. The minute order recited that
the deed of trust executed by Hewko provided that upon default, JMJ Financial
Group was entitled to the appointment of a receiver and the collection of
rents. It further stated that JMJ
Financial Group had provided the declaration of its principal, who declared
that a default had taken place in November 2010, so the appointment of a
receiver was proper.

The
clerk’s transcript also contains a copy of an order confirming the appointment
of a receiver, filed on February 6, 2012 and identifying Andrew R. Zimbaldi as
the receiver. It also contains a motion
for reconsideration filed by Hewko and Honc and a copy of an order denying that
motion.





II

DISCUSSION

>A.
Overview:

> Hewko
and Honc raise issues under the following topic headings: (1) the trial court lacked subject matter
jurisdiction to rule on the application for the appointment of a receiver; (2)
the court erred in making its determination without reviewing certified
documents, holding oral argument, or making preliminary findings ; (3) the
court failed to address preliminary elements and factors; (4) JMJ Financial
Group failed to make the necessary evidentiary showing for the appointment of a
receiver; (5) the court failed to make necessary findings; (6) the court made determinations
without a constitutionally required fair hearing; and (7) the judge should have
recused himself.

To
the extent that Hewko and Honc may raise additional issues without separate
topic headings or subheadings, we do not consider them. Rather, we “disregard arguments that do not
comply with California Rules of Court, rule [8.204(a)(1)(B)], which requires
separate headings for each point.
[Citations.]” (>Akins v. State of California (1998) 61
Cal.App.4th 1, 17, fn. 9.)



B. Lack of Subject Matter
Jurisdiction:

Hewko
and Honc allege that the order appointing the receiver was obtained though a
fraud upon the court. They explain that
JMJ Financial Group falsely represented that the loan was outstanding, even
though Hewko had tendered the “private registered setoff bond.” JMJ Financial Group represents that Hewko’s
loan documents require the loan to be paid “in U.S. dollars, payable to ‘JMJ
Financial Group,’” not via the tender of a purported bond. However, Hewko and Honc maintain that when
the “private registered setoff bond” was tendered to JMJ Financial Group, the
loan was deemed satisfied in full. They
further argue that the tender extinguished the deed of trust and the court had
no power “to execute the terms of a dead document.”

Clearly,
the parties disagree as to whether the tender eradicated the debt. However, the issue Hewko and Honc frame on
appeal is whether the court had jurisdiction in this matter. None of the authorities they cite show that
the court did not have jurisdiction.
(See Long v. Shorebank Development
Corp. (7th Cir. 1999) 182 F.3d 548 [federal court jurisdiction over state
law claims]; Lubben v. Selective Service
System Local Bd. No. 27 (1st Cir. 1972) 453 F.2d 645 [federal court
jurisdiction to enjoin induction into armed services]; Winnett v. Roberts (1986) 179 Cal.App.3d 909, 922 [tender of amount
due extinguishes lien]; Lichty v. Whitney
(1947) 80 Cal.App.2d 696, 702 [tender of amount owing under trust deed
extinguishes security]; Code Civ. Proc., § 1008 [motion for reconsideration];
Code Civ. Proc., § 2074 [offer to pay equivalent to tender of money]; Code
Civ. Proc., § 2076 [failure to object to tender constitutes waiver]; Civ.
Code, § 2924c [cure of default]; Cal. U. Com. Code, § 3603 [effect of
tender of payment].) Hewko and Honc have
not met their burden to show error on this point.



C. Decision Without Reviewing
Certified Documents, Holding Oral Argument, or Making Preliminary Findings:

Hewko
and Honc also argue that the court erred in deciding “the issue of ownership of
title to the subject property without the supporting certified documents and
without oral argument; then the court failed to make preliminary findings that
as a matter of law should have caused a denial of the motion to appoint a
receivership.” (Capitalization, boldface
and underscoring omitted.) Having failed
to support their argument with either citations to the record or legal
authority, their argument on these points is deemed waived. (Schubert
v. Reynolds (2002) 95 Cal.App.4th 100, 109.)

Under
the same topic heading, although apparently on a different point, Hewko and
Honc assert that before the court may grant an application for the appointment
of a receiver, it must inquire into the validity of the moving party’s
contentions. They also contend that JMJ
Financial Group, in seeking the appointment of a receiver, fraudulently
concealed from the court the fact that the debt had been extinguished upon
tender of the “private registered setoff bond.”
Their only citation to legal authority, Code of Civil Procedure section
529, subdivision (a), does not address the requirements for the appointment of
a receiver, or the effect of either fraudulent concealment or the extinction of
a debt, just as it does not address whether the court must review “certified
documents,” hold oral argument, or make preliminary findings. The statute only pertains to undertakings in
connection with the issuance of an injunction.



D. Failure to Address
Preliminary Elements and Factors:

In a
related argument, Hewko and Honc contend that the court erred in failing to
“adequately address the preliminary elements and factors for
receivership.” (Capitalization, boldface
and underscoring omitted.) They state
that a receiver may only be appointed in accordance with Code of Civil
Procedure section 564.

We
observe that Code of Civil Procedure section 564, subdivision (b)(2) permits
the appointment of a receiver “[i]n an action by a secured lender for the
foreclosure of a deed of trust . . . where it appears that the property is in
danger of being

. . . materially injured, or
that the condition of the deed of trust . . . has not been performed, and that
the property is probably insufficient to discharge the deed of trust

. . . debt.” Section 564, subdivision (b)(9) authorizes
the appointment of a receiver “[i]n all other cases where necessary to preserve
the property or rights of any party.”
Section 564, subdivision (b)(11) permits the appointment of a receiver
“[i]n an action by a secured lender for specific performance of an assignment
of rents provision in a deed of trust . . . .”
The minute order in the matter before us cites section 564, subdivision
(b)(9) as the authority upon which it relied.

Hewko
and Honc contend it was “illegal” to appoint a receiver because the validity of
the debt had not been determined.
However, they cite no legal authority in support of this point. Consequently, their argument is deemed
waived. (Roden v. AmerisourceBergen Corp. (2010) 186 Cal.App.4th 620,
648-649.)

They
also say the court, in equity, should not have appointed a receiver. They cite “Code of Civil Procedure section
564(7)” in support of this argument.
However, there is no “Code of Civil Procedure section 564(7).” We assume Hewko and Honc mean to refer to
section 564, subdivision (b)(7), which permits the appointment of a receiver in
an unlawful detainer action. However,
the underlying case is not an unlawful detainer action and the court did not
rely on subdivision (b)(7) in any event.



E. Lack of Evidentiary Showing:

Similarly,
Hewko and Honc assert that JMJ Financial Group did not submit the evidence
necessary to support the appointment of a receiver. They claim that the appointment of a receiver
is a drastic remedy that should only be considered as a last resort, and that a
receiver should not be appointed where the appointment would do more harm than
good. They claim that JMJ Financial
Group had an adequate remedy without resort to a receivership since there was
adequate equity in the property to protect it, and that the court failed to
consider whether there was an alternative remedy. However, Hewko and Honc cite no portion of
the record showing the amount of equity in the property and, thus, whether
there was an adequate alternative remedy.

Hewko
and Honc also claim that, given what they characterize as exorbitant receiver
fees, the appointment did more harm than good.
However, they cite no portion of the record containing evidence about
either the amount of the collections or the amount of the receivership fees. Consequently, they have not shown that the
appointment of the receiver did more harm than good. Anyway, whether the receiver performed well
after the fact is not germane to the issue of whether the JMJ Financial Group
provided the evidence necessary to support the appointment of a receiver in the
first place.

They
also contend that a receiver may only be appointed when it is in the best
interests of each of the parties, citing Code of Civil Procedure section
708.620. That statute provides: “The court may appoint a receiver to enforce
the judgment where the judgment creditor shows that, considering the interests
of both the judgment creditor and the judgment debtor, the appointment of a
receiver is a reasonable method to obtain the fair and orderly satisfaction of
the judgment.” As is apparent, section
708.620 applies in the context of the enforcement of a money judgment. However, we are not concerned with the
enforcement of a money judgment here, and the court did not rely on section
708.620 in appointing the receiver. It
relied on Code of Civil Procedure section 564.
Consequently, the citation to Code of Civil Procedure section 708.620 is
unavailing.



F. Failure to Make Findings:

Next,
Hewko and Honc argue that the court erred when, over their objections, it
failed “to make findings of essential elements of a claim to establish a basis
for determination of its ruling.”
(Capitalization and boldface omitted.)
However, they provide no citation to the record to show either that they
requested the court to make findings or that the court failed to make
findings. Consequently, their argument
on the point is waived. “[W]e need not
address any argument that is unsupported by record references. [Citation.]”
(Roden v. AmerisourceBergen Corp.,> supra, 186 Cal.App.4th at p. 634.)







>G.
Denial of Constitutional Right to Fair Hearing:

On another point, Hewko
and Honc assert that they had a due process right to a fair hearing, including
the right to produce evidence and cross-examine witnesses. However, they fail to cite any portion of the
record to show that they were denied those rights. Consequently, their argument on those points
is deemed waived. (Roden v. AmerisourceBergen Corp., supra, 186 Cal.App.4th
at p. 634.)

Hewko
and Honc further contend that “[o]n January 30, 2102, Judge Gregory H. Lewis
refused to hear and denied all motions and objections from defendant and his
agents.” This argument also is
unsupported by citations to the record and thus deemed waived. (Roden
v. AmerisourceBergen Corp., supra,> 186 Cal.App.4th at p. 634.)



H. Recusal:

Finally,
Hewko and Honc claim the judge must have been biased against them. They say a judge must disqualify himself when
an objective observer would reasonably question whether the judge was
impartial. However, they do not state
that they made a motion to disqualify the judge and they cite no portion of the
record to support the assertion that the judge was biased. Their argument is waived for failure to cite
the record. (Roden v. AmerisourceBergen Corp., supra, 186 Cal.App.4th
at p. 634.)



I: Motion for Reconsideration:

Although
the notice of appeal indicates that
Hewko and Honc appeal from both the order appointing a receiver and the order
denying their motion for reconsideration, they make no argument concerning the
denial of the motion for reconsideration.
Consequently, they are deemed to have abandoned any challenge to the
order denying the motion for reconsideration.
(G.R. v. Intelligator (2010)
185 Cal.App.4th 606, 610, fn. 1.)

J. Conclusion:

On
appeal, we presume that the order of the trial court is correct. (Virtanen
v. O’Connell (2006) 140 Cal.App.4th 688, 709.) It is the appellants’ burden to show
error. (Id. at p. 710.) Here, Hewko
and Honc have failed to meet their burden.
The record they present only shows, if anything, that they deployed a
preposterous mass of highly suspect paperwork to gum up the record in an effort
to stave off foreclosure. This case has
all the earmarks of a matter that merits further review by the proper
authorities.

III

DISPOSITION

The
orders are affirmed. JMJ Financial Group
shall recover its costs on appeal. The
clerk of this court is directed to provide copies of this opinion to the
district attorney, the United States Attorney and the California Secretary of
State.









MOORE,
J.



WE
CONCUR:







RYLAARSDAM,
ACTING P. J.







BEDSWORTH,
J.