Windmill Investment Advisors v. Buono CA4/1

Filed 10/27/26 Windmill Investment Advisors v. Buono CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION ONE STATE OF CALIFORNIA WINDMILL INVESTMENT ADVISORS, D083478 INC., Plaintiff and Respondent, (Super. Ct. No. GIC874841) v. PASQUALE BUONO, Defendant and Appellant. PASQUALE BUONO, as trustee, etc., D085956 Plaintiff and Appellant, v. (Super. Ct. No. 37-2021- FARAMARZ YOUSEFZADEH et al., 00048085-CU-BC-CTL) Defendants and Respondents.  CONSOLIDATED APPEALS from a judgment and an order of the Superior Court of San Diego County, Matthew C. Braner, Judge. Affirmed. Mario Iskander for Defendant and Appellant in D083478 and Plaintiff and Appellant in D085956. Brody & Shemwell, David W. Brody and Kenneth R. Shemwell for Plaintiff and Respondent in D083478 and Defendants and Respondents in D085956. Pasquale Buono appeals a judgment and an order that the superior court entered in a pair of lawsuits pertaining to the development and financing of real property in downtown San Diego. He contends the superior court erred (1) in denying him relief from a default judgment in one of the two lawsuits and (2) in granting dispositive motions and entering judgment against him in the other lawsuit. We disagree. Hence we affirm. I. BACKGROUND Both lawsuits arise in the context of efforts to develop real property, at the site of the historic California Theater Building and an adjacent parking lot, located on a portion of the block bounded by B Street, C Street, Third Avenue, and Fourth Avenue in downtown San Diego (the property). At the center of each of the two lawsuits are two individuals: Buono and Faramarz Yousefzadeh. A. The Two Lawsuits The first lawsuit (the Guaranty Enforcement Case) commenced in 2006. It is an action, filed by a Yousefzadeh affiliate named Windmill Investment Advisors, Inc. (Windmill Investment) against Buono, to enforce a 2 loan guaranty. The second lawsuit (the Usury and Fraud Case1) commenced in 2021. It is an action by Buono against Yousefzadeh and six Yousefzadeh affiliates—Sloan Capital Partners, LLC (Sloan); Windmill Realty Advisors, Inc. (Windmill Realty); Windmill Investment; Windmill Capital (CA), Inc.; Windmill Capital, Inc.; and 1122 4th Avenue, LLC—alleging usury, fraud, violation of 18 United States Code section 1962 et seq. (Racketeer Influenced and Corrupt Organizations Act) (RICO), and breach of contract. (We hereafter refer to the seven defendants in the Usury and Fraud Case as Respondents.) B. Chronology of Events 1. 2005–2008: Events Culminating in Entry of Default Judgment and in Dissolution of Windmill Investment Buono met Yousefzadeh in 2005, when the two men were introduced in connection with Buono’s efforts to acquire the property for an entity he had created named the California Theatre Investment Group, LLC (CTIG). In September of that year, Yousefzadeh arranged for Windmill Realty to make a $7 million loan to CTIG to complete the acquisition. The loan was evidenced by a promissory note; and obligations under the note were personally guaranteed by Buono and secured by the lien of a deed of trust to the property. Under the terms of the note, the principal was required to be repaid within 90 days. But when the due date arrived, CTIG defaulted by not repaying the loan. Thus, in 2006, Windmill Investment (a Yousefzadeh affiliate to which Windmill Realty had assigned its beneficial interest under the note and deed of trust) initiated foreclosure proceedings by causing a 1 We refer to the second lawsuit as the Usury and Fraud Case for purposes of convenience only. As discussed post, usury and fraud are just two of four theories of action that Buono pleaded in that case. 3 notice of default and a notice of trustee’s sale to be recorded. But, prior to the time scheduled for the trustee’s sale to occur, CTIG filed a petition for protection in bankruptcy court. Windmill Investment responded to the bankruptcy petition by (1) filing a claim against CTIG in the bankruptcy court, (2) initiating the Guaranty Enforcement Case in superior court, and (3) filing a motion for relief from stay in bankruptcy court, to enable it to move forward with the Guaranty Enforcement Case in superior court. CTIG resisted the claim Windmill Investment had filed in bankruptcy court, alleging among other things that the rate of interest under the note was usurious and that, as a result, the claim was inflated. It also resisted the motion for relief from stay. Negotiations ensued; and, in 2007, the negotiations yielded several written agreements.2 Among the agreements was a stipulation, filed in the bankruptcy court, in which CTIG and Windmill Investment agreed Windmill Investment should be granted relief from stay. Buono contends—and Respondents dispute—that the agreements reached in 2007 included not only written agreements, but also an oral agreement (the purported oral agreement). We discuss the alleged terms of the purported oral agreement in detail in our discussion below. Buono further maintains that in mid-2007, near in time to when the purported oral agreement was reached, he and CTIG’s investors formed a trust named the 2 At least two such agreements were signed by Buono on behalf of CTIG and by Yousefzadeh on behalf of Windmill Investment. Another such agreement (the stipulation for relief from stay) was signed by counsel for CTIG and by counsel for Windmill Investment. 4 CTIG Windmill Trust3 for the purpose of holding title to and enforcing rights of CTIG and its managers, members, and investors under the terms of the purported oral agreement. In addition, Buono contends he and CTIG performed all of their obligations under the terms of the purported oral agreement by assisting Respondents in various ways over the course of the ensuing years. Toward the end of 2007, the bankruptcy court granted Windmill Investment relief from stay.4 Then, in March 2008, Windmill Investment assigned its beneficial interest under the note and deed of trust to Sloan; Sloan completed the foreclosure proceedings that had been commenced by Windmill Investment; and Sloan acquired the property via a credit bid. Eight months later (in December 2008) Windmill Investment filed, in the Guaranty Enforcement Case, a request for entry of default judgment against Buono. Then, later that same month, on December 11, 2008, the 3 Respondents contend the CTIG Windmill Trust “was fabricated” and “is a fraud.” We do not address these contentions; however, as discussed post, we do conclude the trust is invalid. 4 The order granting relief from the bankruptcy stay stated: “Windmill Investment . . . is granted immediate and complete relief from the automatic stay of 11 USC §362 to take any and all action necessary, including foreclosure and sale, to enforce its lien against the [property]. “[¶] . . . [¶] “ . . . This order terminating the automatic stay as to [Windmill Investment] will be enforceable as to all parties to this agreement and any subsequent or converted proceeding.” 5 superior court entered a default judgment, for Windmill Investment and against Buono, and Yousefzadeh dissolved Windmill Investment. 2. 2018–2021: Renewal of Default Judgment, Sale of Property, and Dissolution of Sloan For nearly 10 years following the 2008 entry of the default judgment, the Guaranty Enforcement Case remained virtually inactive. Then, toward the end of 2018, the case was reactivated with the filing by Windmill Investment of an application to renew the default judgment. Buono did not oppose the renewal application. In May 2019, the superior court granted the application, whereupon the default judgment was renewed. Then later that year, according to Buono, an affiliate of Yousefzadeh sold the property for $21.1 million—$2.9 million of which Buono now contends should have been paid to the CTIG Windmill Trust, pursuant to the terms of the purported oral agreement. Thereafter, in 2021, Yousefzadeh dissolved Sloan. 3. 2021–2022: Initiation of Usury and Fraud Case, and Demurrers to the Original and First Amended Complaints in That Case In 2021, Buono initiated the Usury and Fraud Case with the filing of a complaint against Respondents in superior court. Whereas the Guaranty Enforcement Case had been filed against Buono in his individual capacity, Buono filed the Usury and Fraud Case as “Trustee of the CTIG Windmill Trust.” In the original complaint and in a first amended complaint in the Usury and Fraud Case, Buono as trustee alleged that the terms set forth in the 2005 promissory note rendered that instrument usurious and in violation of RICO, that Respondents had entered into the purported oral agreement intending not to honor it, and that they had breached that purported agreement. 6  Respondents demurred to the original and first amended complaints. The superior court overruled the demurrers as to the fraud theory of action but sustained them as to the other three theories. In its ruling on the demurrer to the first amended complaint, the court granted leave to amend as to the usury and RICO theories. 4. 2022–2023: Steps Taken in the Name of Windmill Investment to Enforce the Renewed Default Judgment Against Buono in the Guaranty Enforcement Case During the last two months of 2022 and the first two months of 2023, Windmill Investment obtained a writ of execution and notices of levy in the Guaranty Enforcement Case, and served them in an effort to garnish Buono’s bank accounts pursuant to the renewed default judgment in that case. 7  5. 2023: Buono’s Motion to Cancel the Renewed Judgment in the Guaranty Enforcement Case; His Filing of the Second Amended Complaint in the Usury and Fraud Case; and Respondents’ Demurrer to that Complaint On March 29, 2023, Buono took action in the Guaranty Enforcement Case and the Usury and Fraud Case. In the Usury and Fraud Case, he filed a second amended complaint, reasserting the usury, fraud, and RICO theories of action; and, in the Guaranty Enforcement Case, he filed a motion seeking relief from the renewed default judgment.5 From this point forward, both cases were assigned to the same judge.6 5 The motion seeking relief from the renewed default judgment in the Guaranty Enforcement Case was titled: “Motion to Compel Acknowledgment of Satisfaction of Judgment, Recall Writ of Execution and Cancel Renewal of Judgment” (motion). In the second amended complaint in the Usury and Fraud Case, Buono explained the provenance of that motion as follows: “Yousefzadeh [had] suggested to [Buono in 2007 or 2008, during the pendency of the Guaranty Enforcement Case,] that he could protect him from other creditors by finishing [the Guaranty Enforcement Case] after the foreclosure sale. [To this end, he] proposed obtaining a money judgment and record[ing] an abstract of judgment but promised . . . that he would never actually levy or seek to collect on the judgment [and] would [instead] use it [to help shield Buono] from other creditors. [Buono] relied on Yousefzadeh’s statements and allowed his default to be taken in the [Guaranty Enforcement Case] . . . . Yousefzadeh kept his word and never levied the judgment or sought to enforce the judgment until, for the first time after 14 years, in December 2022, and after [Buono had] filed this action because Yousefzadeh broke his promise to reimburse plaintiff and the CTIG investors their equity in the property, [Windmill Investment] levied the judgment on plaintiff’s bank account. [Thus Buono] will be moving in [the Guaranty Enforcement Case] to compel a satisfaction 8  In the Usury and Fraud case, Respondents filed a demurrer focusing on the usury and RICO theories of action that had been pleaded in the second amended complaint, and the superior court sustained this demurrer without leave to amend. This left fraud as the only remaining theory of action in the Usury and Fraud case. In the Guaranty Enforcement Case, the superior court treated the motion seeking relief from the renewed default judgment as a motion to vacate that judgment. The court issued a tentative decision to grant the motion and vacate the renewed default judgment. But then, on further consideration, it denied the motion. 6. 2024: Summary Judgment Motion and Entry of Judgment in the Usury and Fraud Case In 2024, Respondents filed a motion for summary judgment targeting the fraud theory of action in the Usury and Fraud Case. The superior court granted the motion on the grounds that Buono lacked standing to prosecute the case because the trust in whose name he had initiated the case (the CTIG Windmill Trust) had not been validly formed. Then, each of the four theories of action in the Usury and Fraud Case having been eliminated via dispositive motions, the superior court entered judgment, for Respondents and against Buono, in that case. of judgment based on the improprieties in connection with obtaining the judgment.” 6 The Usury and Fraud Case was assigned to Judge Matthew C. Braner at its inception in November 2021. The Guaranty Enforcement Case was assigned to Judge Braner at the time of the filing of the motion. Prior to that time, the Guaranty Enforcement Case had been assigned to Judge Jay M. Bloom at the time the default judgment was entered, and to Judge Randa Trapp at the time the default judgment was renewed. 9  7. The Appeals Buono timely appealed the judgment in the Usury and Fraud Case and the order denying relief from the renewed default judgment in the Guaranty Enforcement Case. II. DISCUSSION Buono contends the superior court erred (1) in granting the demurrers and the motion for summary judgment, and in entering judgment against him, in the Usury and Fraud Case; and (2) in denying him relief from the renewed default judgment in the Guaranty Enforcement Case. A. The Usury and Fraud Case 1. Standard of Review Buono’s assignments of error in the Usury and Fraud Case challenge the superior court’s judgment after its orders sustaining the demurrers and granting the motion for summary judgment. We review such orders de novo. (Doe v. Finke (2022) 86 Cal.App.5th 913, 921 [demurrer]; Magallanes v. Doctors Medical Center of Modesto (2022) 80 Cal.App.5th 914, 922 [summary judgment].) In reviewing those orders, we begin with a focus on the superior court’s conclusion that the trust had not been validly formed and that, as a result, Buono lacked standing to maintain suit as trustee of the CTIG Windmill Trust. 2. Analysis It is a bedrock tenet of trust law that “[a] trust is created only if there is trust property.” (Prob. Code, § 15202.) So essential is this requirement that it has been described as “ ‘a sine qua non’ ” “ ‘to the creation of a trust.’ ” (Balian v. Balian’s Market (1941) 48 Cal.App.2d 150, 156 (Balian).) Not only is it essential that the trust own property; it also is essential that the property be ascertainable with reasonable certainty. (Reagh v. 10 Kelley (1970) 10 Cal.App.3d 1082, 1089 (Reagh) [“ ‘The declaration of trust . . . must be reasonably certain in its material terms; and this requisite of certainty includes the subject-matter or property embraced within the trust’ ”]; accord Balian, supra, 48 Cal.App.2d at p. 156 [the property for which the trust was created “ ‘ “must be clearly and definitely pointed out” ’ ”]; In re Ralston’s Estate (1934) 1 Cal.2d 724, 726 (Ralston) [“It is essential to the validity of a trust . . . that [its] subject-matter . . . be certain. The authorities are legion to this effect.”].) Thus uncertainty as to what property is being transferred into a trust can render the trust invalid. According to Buono’s opening brief on appeal, the CTIG Windmill Trust was “created by assignments of claims from Buono and family members in 2007 and funded again by CTIG’s express assignment of claims in 2010,” and these “assignments transferred [such persons’] right[s] to payment from Yousefzadeh and Windmill under the [purported oral] agreement.” An examination of the CTIG Windmill Trust declaration of trust and of the assignments confirms that the assignments purport to have done precisely that (i.e., transfer into the trust the trustors’ rights to payment under the purported oral agreement). But what exactly were those “right[s] to payment . . . under the . . . [purported oral] agreement” that were being transferred into the trust? As we explain below, Buono’s descriptions of such “right[s]” shifted significantly over time. According to the declaration of trust that Buono says he signed on May 30, 2007, the answers to these questions are as follows: “Yousefzadeh, Windmill Investment . . . and their related entities . . . promised to pay [CTIG and its managers, members and investors] its invested capital in the 11  [p]roperty and twenty percent of the net sale proceeds on resale of the [p]roperty.”7 Fourteen and a half years later, Buono described the consideration due from Respondents under the purported oral agreement differently from the way in which he had described it in May of 2007. Specifically, in the original complaint that he filed in the Usury and Fraud Case in November 2021, he said: “The parties . . . agreed that when Defendants eventually re-sold the [p]roperty in the marketplace the net sales proceeds would be divided as follows: Buono and the CTIG investors would receive their original investment in the [p]roperty of $2,200,000.00; . . . Defendants would receive reimbursement of their original cash investment in the [p]roperty of $7,800,000; . . . any party who paid out-of- pocket costs for property taxes in the future would be reimbursed that amount; and any surplus sale proceeds after reimbursement of each party’s cash investments would be split 20% to Buono /CTIG and 80% to Defendants.” (Italics added.) Ten months later in the first amended complaint, which he filed in September 2022, Buono added some additional information to the description. Now, the consideration would be due “[w]hen the [p]roperty was [either] re-sold by defendants, or re-developed”; and Respondents would be entitled to be reimbursed, not just for property taxes, but also “for out-of- pocket expenses in carrying the [p]roperty, including property taxes.”8 (Italics added.) 7 The assignments included similar language. 8 The description in the second amended complaint of the consideration due from Respondents is identical to that in the first amended complaint. 12  Four months later, in an interrogatory response that he signed in January 2023, Buono added some new information to his description of the purported oral agreement. In this telling, the parties were to net out in their calculation of profits Windmill Investment’s “out of pocket investment and holding costs,” which he explained included or consisted of “actual cash loaned funds, property taxes, and payoffs to senior lenders and other advancements.” (Italics added.) Six months thereafter, in a supplemental interrogatory response that he signed in July 2023, Buono amplified on the circumstances in which the purported oral agreement had come into existence. He did so by describing a meeting between himself and Yousefzadeh in which the parties allegedly agreed to the purported oral agreement. According to this amplification, in this meeting, Buono articulated to Yousefzadeh his (Buono’s) and CTIG’s objectives. But nowhere in this description is there an indication that any of the Respondents assented to those objectives: “At a meeting between Mr. Buono and Mr. Yousefzadeh in mid-2007, Mr. Yousefzadeh stated his desire to do a deal with Mr. Buono that would allow Windmill [Investment] to take ownership of CTIG’s property. He said that he wanted to re-develop the property, or obtain entitle it [sic], and then sell it. Mr. Buono stated that he had a number of design professionals working on re-development plans for the property and he would turn over everything CTIG had done to Mr. Yousefzadeh and introduce him to his designers and planners. Mr. Buono said that what CTIG wanted in return was reimbursement of the funds its group of investors had paid to acquire the [p]roperty and for plans. Mr. Buono estimated this amount at a little over $2 Million. Mr. Buono said that if Mr. Yousefzadeh – Windmill [sic] would agree to this term, that CTIG and he would fully cooperate with Mr. Yousefzadeh so as to allow Windmill to take ownership of the property. He told Mr. Yousefzadeh that the latter should conceive the plan 13  because Mr. Yousefzadeh was a lawyer. Mr. Yousefzadeh said that he first needed to return all funds which Windmill had loaned out/invested before CTIG would be paid any of their funds. Mr. Yousefzadeh said that Windmill had laid out about $10 million dollars [sic]. Mr. Buono then asked Mr. Yousefzadeh for a share of any profits if Windmill was able to sell the profit for profit of 10-20%. [Sic.] Mr. Yousefzadeh to some profit sharing. [Sic.] Mr. Buono said that he would cooperate and do whatever Mr. Yousefzadeh wanted.” (Italics added.) As can be seen, nowhere in this telling is there any indication that Yousefzadeh assented to what Buono has attested he “asked” or to what he has attested he said CTIG “wanted.” As can also be seen, the investment by Windmill in this telling is now $10 million rather than $7.8 million. In April 2024, nine months after signing the supplemental interrogatory response just discussed, Buono was deposed. In the deposition, he described the purported oral agreement as “very simple,” and he reiterated the 80/20 split: “Q. What did they promise to you? What is the agreement that they offered? “A. Faramarz Yousefzadeh’s money was to be paid back first. My money comes back second. So whatever happened to the property, whether it’s developed or sold, if he sells short, I lose. If he is made whole and there’s enough for me to be made whole, I’m made whole. Then we go 80-20 percent on any upside. And that’s the deal. “[¶] . . . [¶] “A. It was [a] very simple deal. Very simple deal.” But six months later, Buono added two terms—interest and a potential 90/10 split—that had not appeared in any of the descriptions he had provided before. Specifically, in a declaration he filed in October 2024, Buono said: 14  “In or around April or May 2007 . . . I [told Yousefzadeh] that my family, friends and I had invested approximately $2.1 Million . . . in the project and wanted a net payment of that amount . . . . I bargained for a 20% participation in addition to the $2.1M[9] net payment, if Windmill developed the [property]. I bargained for 10% of the project if I was able to secure the other half of the block for Windmill . . . . [10] Mr. Yousefzadeh agreed stating that it was an acceptable arrangement. He noted, however, that[,] as f[a]r as the net payment of $2.1 Million to CTIG, Windmill needed to get all of its money it had advanced into the project with interest before any net payment to CTIG/Buono. We both agreed this would be acceptable.” (Italics added.) Most recently, in the opening brief he filed for the present appeal, Buono described the consideration due from Respondents in a way that differs from all of the descriptions that have come before. Specifically, he has asserted, without citation to the record, that: 9 We presume that this $2.1M figure corresponds to the $2.2 million figure that Buono referenced in his earlier descriptions and that the discrepancy may simply be attributable to a rounding error. 10 The first mention of a 90/10 split that we have been able to locate in the record occurs in the deposition testimony of a witness who testified that he was present at the meeting between Buono and Yousefzadeh during which the purported oral agreement is alleged to have come into existence. That witness, James Massery, testified in his deposition that: “The terms of the agreement were to develop the whole block. It would be a 90/10 split. It would be money back to him [Yousefzadeh] first and then our money back and then 90/10 on the profit.” As can be seen, Massery’s rendition of the purported oral agreement differs from all of Buono’s renditions in that, in Massery’s telling, 90/10 was not an alternative to 80/20 that depended on whether or not the entire block was developed; rather, according to Massery’s deposition testimony, there was no circumstance in which the split was to be 80/20. 15  “Respondents promised . . . to pay CTIG’s investors their original $2,200,000 investment upon resale of the property, provided that Respondents had first recovered their principal and interest. Respondents further agreed that if the entire block were acquired and developed, profits would be divided eighty percent to Respondents and twenty percent to CTIG’s investors, with a ninety-ten split to apply otherwise.” (Italics added.) As can be seen, the description of the “rights” that were transferred into the trust changed materially from one telling to the next to the next. In the first telling, Buono described a return of invested capital plus 20 percent of net proceeds on sale of the property. In subsequent tellings, Buono: 1. Varied the identity of the liquidity event (development versus sale) that would trigger the sharing of net proceeds; 2. Varied the identit(ies) of the persons who would be entitled to share in such proceeds on the occurrence of the liquidity event; 3. Varied the amount of Windmill Investment’s original investment in the property; 4. Serially altered the formula to be used in calculating net proceeds; 5. Added an interest provision without specifying the rate;11 and 6. Asserted three mutually inconsistent formulations for the split of net proceeds, including: 11 The discrepancies relating to interest not only are material (see Reeder v. Specialized Loan Servicing LLC (2020) 52 Cal.App.5th 795, 802–803 [alleged oral agreement that was silent as to interest rate held “too uncertain and indefinite to be enforced”]; Gould v. Callan (1954) 127 Cal.Ap.2d 1, 6 [rate of interest is a “material and essential” term, silence as to which “makes the contract uncertain and indefinite”]); they also are startling in light of the fact that in 2007, when the purported oral cooperation agreement is alleged to have come into existence, the parties were actively litigating allegations of usury. 16  a. Initially, a split purporting to entitle persons associated with CTIG to be paid 20 percent of any net proceeds on the sale of the property irrespective of how much of the block was acquired and developed or sold; b. Beginning in 2024, a split purporting to limit such persons’ percentage share to just 10 percent (instead of 20 percent) in the event of a sale of the entire block; and c. Beginning in 2025, a split purporting to limit such persons’ percentage share to that same 10 percent (again instead of 20 percent) in the event of a sale of just half the block. These discrepancies in Buono’s evolving descriptions of the consideration due from Respondents under the purported oral agreement obviously cast grave doubt on the existence of enforceable contractual rights under such a purported agreement. (See Ladas v. California State Auto. Assn. (1993) 19 Cal.App.4th 761, 770 [“ ‘Where a contract is so uncertain and indefinite that the intention of the parties in material particulars cannot be ascertained, the contract is void and unenforceable.’ ”].) Those same discrepancies render the purported trust property so uncertain that even if Buono were ultimately to succeed in proving that he and Yousefzadeh had entered into an oral agreement—which, as noted, Yousefzadeh disputes—we would be completely unable to articulate with any reasonable certainty what “rights” had been assigned to the trust as the property of the trust. Accordingly, we conclude that the trust is invalid.12 (See Reagh, supra, 12 Like the conclusion by this court that the trust is invalid, the conclusion by the superior court that the trust is invalid is premised on infirmities having to do with the topic of trust property. Whereas the superior court’s conclusion was that no property had been transferred into the trust, our conclusion is that, if property was transferred into the trust, its identity is too uncertain inasmuch as it has not been “ ‘ “clearly and definitely pointed out.” ’ ” (Balian, supra, 48 Cal.App.2d at p. 156.) 17 10 Cal.App.3d at p. 1089; Balian, supra, 48 Cal.App.2d at p. 156; Ralston, supra, 1 Cal.2d at p. 726.) Because the trust as to which he purports to be trustee is an entity that does not exist (because it was not validly formed), Buono is without standing or authority to initiate or maintain suit on its behalf on any theory. Hence the judgment against him in that case was warranted. B. The Guaranty Enforcement Case Buono contends the superior court erred in denying his motion for relief from the renewed default judgment in the Guaranty Enforcement Case. In support of this contention, he argues: (1) that Windmill Investment committed fraud on the court by submitting a false declaration to obtain and renew the default judgment; (2) that the original default judgment was void ab initio because Windmill Investment had assigned the note and deed of trust to Sloan prior to the superior court’s entry of the original default judgment for Windmill Investment; (3) that the renewal of the default judgment was void because it was filed by a dissolved corporation (Windmill Investment); (4) that the 2019 renewal was untimely and procedurally defective; and (5) that the bankruptcy court’s grant of relief from stay applied only to Windmill Investment and not to the party that completed the foreclosure (Sloan).13 We address each of these arguments in turn. 1. Buono’s Argument that Windmill Investment Committed a Fraud on the Court Buono’s first argument challenging the denial of his motion for relief from the renewed default judgment in the Guaranty Enforcement Case is 13 The parties are not in complete agreement as to the standards of review to be applied in evaluating the five arguments enumerated ante; however, we need not resolve their differences, as we conclude each of these arguments is meritless irrespective of the standard to be applied. 18 that Windmill Investment committed a fraud on the court. This argument is premised on a declaration of Yousefzadeh that Windmill Investment filed in 2008 in support of its request for entry of the original default judgment. In that declaration, Yousefzadeh said: “18. On December 19, 2007, after extended litigation in the bankruptcy court action, [Windmill Investment] obtained relief from the automatic stay to proceed to its foreclosure sale against [the property]. “19. On March 13, 2008, [Windmill Investment] conducted its foreclosure sale on [the property] by electing to purchase [it] by credit bid. [Windmill Investment] bid $7,000,000.00 of its existing debt . . . to purchase [the property]. Therefore, a substantial deficiency exists which it seeks to recover from Buono . . . . “20. As of the date of foreclosure, [Windmill Investment] was owed $14,000,221.25 under the terms of the Secured Note.” Some of the statements in paragraphs 19 and 20 were untrue inasmuch as Windmill Investment had assigned its interests in the note and deed of trust to Sloan prior to the foreclosure sale. Thus, it was Sloan (not Windmill Investment) that conducted the foreclosure sale, that bid the $7 million, and that was owed the deficiency. Yousefzadeh acknowledged as much in a declaration in 2023, after Buono had brought the discrepancy to the attention of the superior court in support of his motion for relief from the renewed default judgment. Specifically, Yousefzadeh said: “The statement in paragraph 19 of my Declaration in Support of Default Judgment dated November 6, 2008 that ‘[Windmill Investment] foreclosed’ on the [p]roperty was made in error. This statement was an oversight, and I never intended to mislead the Court in any manner.” 19  The superior court appears to have accepted this explanation, and so do we. Moreover, the fact remains that Buono acknowledges he consented to entry of the original default judgment. (See ante.) Consequently, we find in Yousefzadeh’s incorrect statements from 2008 neither fraudulent intent on the part of Yousefzadeh nor prejudice to Buono. 2. Buono’s Argument that Windmill Investment’s Assignment of the Note and Deed of Trust Rendered the Original Default Judgment Void Buono’s second argument challenging the denial of his motion for relief from the renewed default judgment focuses on the March 2008 assignment by Windmill Investment of its beneficial interest under the note and deed of trust to Sloan. The argument is that, because Windmill Investment was no longer the owner of that interest in December 2008—when it requested a default judgment, and when the superior court granted its request and entered the original default judgment in Windmill Investment’s favor—that judgment and the renewed default judgment that followed must both have been void ab initio. We do not agree. Code of Civil Procedure section 368.5 makes plain that a lawsuit may continue in the name of a party that has assigned away its interest in the lawsuit. In fact, that is the default approach under that code section: “An action or proceeding does not abate by the transfer of an interest in the action or proceeding or by any other transfer of an interest. The action or proceeding may be continued in the name of the original party, or the court may allow the person to whom the transfer is made to be substituted in the action or proceeding.” (Code Civ. Proc., § 368.5, italics added; accord Luster v. Collins (1993) 15 Cal.App.4th 1338, 1345 [“When a party transfers an interest in the subject matter of a pending action, the proceeding may be continued in the name of the original party.”]; Cleverdon v. Gray (1944) 62 Cal.App.2d 612, 616 [“it has 20 been consistently held . . . that ‘under [Code of Civil Procedure section 385], . . . if no substitution is asked for, the case will go on in the name of the original party, as if no transfer had been made, and to have it do so, no application to or action by the court is necessary.’ ”].) What Code of Civil Procedure section 368.5 describes is precisely what happened in the lead up to entry of the original default judgment in the Guaranty Enforcement Case. As a consequence, we find no error in that judgment having been entered for Windmill Investment rather than for Sloan. 3. Buono’s Argument that the Dissolution of Windmill Investment Rendered the Renewal of the Default Judgment Void Buono’s third argument challenging the denial of his motion for relief from the renewed default judgment focuses on the December 2008 dissolution of Windmill Investment, the 2018 filing by that same (dissolved) entity of an application to renew the default judgment in its name, and the ensuing 2019 renewal of that judgment in its name. The argument is that, because Windmill Investment no longer existed and no longer owned assets, it could not appear in court to seek renewal of a judgment and could not be named as the judgment creditor in the renewed judgment. Again, we do not agree. Corporations Code section 2010 provides that: “(a) A corporation which is dissolved nevertheless continues to exist for the purpose of winding up its affairs, prosecuting and defending actions by or against it and enabling it to collect and discharge obligations, dispose of and convey its property and collect and divide its assets, but not for the purpose of continuing business except so far as necessary for the winding up thereof. “(b) No action or proceeding to which a corporation is a party abates by the dissolution of the corporation or by 21  reason of proceedings for winding up and dissolution thereof.” Based on subdivision (a) of Corporations Code section 2010, Windmill Investment continued to exist for the purpose of prosecuting the Guaranty Enforcement Case and enabling it to collect on the default judgment in that case. (See Penasquitos, Inc. v. Superior Court (1991) 53 Cal.3d 1180, 1190 [“a corporation’s dissolution is best understood not as its death, but merely as its retireme