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Tentative Rulings for February 27, 2018
Departments 402, 501, 502, 503
There are no tentative rulings for the following cases. The hearing will go forward on
these matters. If a person is under a court order to appear, he/she must do so.
Otherwise, parties should appear unless they have notified the court that they will
submit the matter without an appearance. (See California Rules of Court, rule 3.1304(c).)
14CECG01653 Marilyn Mikow v. Carlos Juarez, M.D. (Dept. 501)
The court has continued the following cases. The deadlines for opposition and reply
papers will remain the same as for the original hearing date.
________________________________________________________________
(Tentative Rulings begin at the next page)
2
Tentative Rulings for Department 402
(20) Tentative Ruling
Re: Itria Ventures LLC v. The Fort Fresno LLC et al., Superior Court
Case No. 18CECG00095
Hearing Date: None. See below.
Motion: The Fort Fresno LLC’s Motion to Vacate Judgment
Tentative Ruling:
To deny.
Explanation:
The motion is procedurally defective. Defendant moves to set aside a sister-
court judgment, but fails file a notice of motion (Cal. Rules of Court, Rule 3.1110,
3.1112(a)) or memorandum of points and authorities (Cal. Rules of Court, Rule
3.1112(a)), provide a statutory basis for the motion, cite to any legal authority or provide
any evidence supporting the contentions made. In law and motion practice, factual
evidence is supplied to the court by way of declarations. (Calcor Space Facility, Inc. v.
Superior Court (1997) 53 Cal.App.4th 216, 224.) The court must disregard facts stated in
unverified memo of points and authorities, unless supported by reference to evidence
presented in declarations or otherwise. (Smith, Smith & Kring v. Superior Court (1997) 60
Cal.App.4th 573, 578.)
Pursuant to Cal. Rules of Court, Rule 3.1312(a) and Code Civ. Proc. § 1019.5(a),
no further written order is necessary. The minute order adopting this tentative ruling will
serve as the order of the court and service by the clerk will constitute notice of the
order.
Tentative Ruling
Issued By: JYH on 02/26/18
(Judge’s initials) (Date)
3
Tentative Rulings for Department 501 (29) Tentative Ruling
Re: Shew v. Sierra Pacific Enterprises, Inc.
Court Case no. 17CECG01004
Hearing Date: February 27, 2018 (Dept. 501)
Motion: Default Prove Up – Court Judgment
Tentative Ruling:
To continue to March 20, 2018, to allow Plaintiff to dismiss the Doe defendants,
and submit a revised proposed order.
Explanation:
Plaintiff has not dismissed the Doe defendants, so default judgment cannot be
entered at this time. (See Calif. Rules of Court, rule 3.1800(a)(7).) The Court notes also
that the proposed judgment submitted by Plaintiff lists at item 1 $56,025.00, which
amount includes costs and attorney’s fees; however at item 2, Plaintiff lists as “further”
recovery, costs and fees again. Plaintiff to resubmit a proposed order that reflects a
judgment of $50,000 principal, $4,750 in attorney’s fees, and $1,275 in costs.
Pursuant to California Rules of Court, rule 3.1312(a) and Code of Civil Procedure
section 1019.5, subdivision (a), no further written order is necessary. The minute order
adopting this tentative ruling will serve as the order of the court and service by the clerk
will constitute notice of the order.
Tentative Ruling
Issued By: MWS on 02/26/18
(Judge’s initials) (Date)
4
03
Tentative Ruling
Re: Amezcua v. Vita-Pakt Citrus Products Co.
Case No. 16 CE CG 03798
Hearing Date: February 27th, 2018 (Dept. 501)
Motion: Plaintiff’s Motions for Certification of Class Action and for
Preliminary Approval of Class Action Settlement
Tentative Ruling:
To grant plaintiff’s motions for certification of class action and for preliminary
approval of class action settlement.
Explanation:
Plaintiffs seek to certify the class for the purposes of approving the settlement,
and also seek an order preliminarily approving the settlement itself. Therefore, the
court must first determine whether the class should be certified before deciding
whether the settlement should be preliminarily approved.
1. Class Certification
Where certification of a class is sought in conjunction with settlement, the
motion is treated the same as if it were a motion solely for certification but for one
factor – the proponent need not prove the case is manageable for trial. Everything
else has to be proven, with admissible evidence, in order for due process concerns to
be met. The Due Process Clause of course requires that the named plaintiff at all
times adequately represent the interests of the absent class members. (Phillips
Petroleum Co. v. Shutts (1985) 472 U.S. 797, 812.) The certification process ensures that
is the case. This is a basic constitutional requirement which applies to all class actions,
federal and state.
"Confronted with a request for settlement-only class certification, a district court
need not inquire whether the case, if tried, would present intractable management
problems [citation omitted] for the proposal is that there will be no trial. But other
specifications of the rule -- those designed to protect absentees by blocking
unwarranted or overbroad class definitions -- demand undiluted, even heightened,
attention in the settlement context." (Amchem Products v. Windsor (1997) 521 U.S.
591, 620.)
“Code of Civil Procedure section 382 authorizes class actions when the
question is one of a common or general interest, of many persons, or when the
parties are numerous, and it is impracticable to bring them all before the court.
The party seeking certification has the burden to establish the existence of both
an ascertainable class and a well-defined community of interest among class
5
members. The ‘community of interest’ requirement embodies three factors: (1)
predominant common questions of law or fact; (2) class representatives with
claims or defenses typical of the class; and (3) class representatives who can
adequately represent the class.” (Medrazo v. Honda of North Hollywood
(2008) 166 Cal. App. 4th 89, 96-97.)
“Trial courts are accorded great discretion in granting or denying
certification . . . As the focus in a certification dispute is on what type of
questions - common or individual - arise in the action, rather than on the merits
of the case, in determining whether there is substantial evidence to support a
trial court's certification order, we consider whether the theory of recovery
advanced by the proponents of certification is, as an analytical matter, likely
to prove amenable to class treatment.” (Ibid.)
In his renewed motion, plaintiff has presented the new, more detailed
declarations from the plaintiff’s attorneys, Gregg Farley and Sahag Majarian, as well as
a new declaration of plaintiff and class representative Cruz Amezcua. Plaintiff’s
declaration now offers more details showing that he suffered the same type of Labor
Code violations as the other putative class members. For example, he had his work
hours reduced because of defendant’s practice of rounding time for employees in the
electronic timekeeping system. (Amezcua decl., ¶ 4.) He was also subject to the same
meal and rest break policies as the other employees. (Ibid.) He and other employees
were frequently denied meal breaks during the first five hours of a work shift. (Id. at ¶ 5.)
He and other employees were also required to sign blanket waivers of their right to a
second meal break if they worked more than 10 hours but less than 12 hours in a day.
(Ibid.) When he was terminated from his employment, plaintiff did not receive any
compensation for the missed meal and rest breaks, or any compensation for
defendant’s time-rounding practice, and his understanding is that other employees did
not receive such compensation either. (Id. at ¶ 7.) Furthermore, plaintiff claims that he
is unaware of any claim or defense that is unique to him or that is substantially different
from the other class members. He also claims that he is aware of his obligation to
pursue the action on behalf of the other class members and look out for their best
interests. (Id. at ¶ 9.)
Thus, plaintiff’s declaration now establishes that he suffered the same type of
injuries that he has alleged in the complaint, and that the harm that he may have
suffered is similar to the harm that may have been inflicted on the other employees. As
such, his new declaration is now sufficient to establish that the class has common types
of claims, that he suffered the same violations as the other class members, and that he
would be an adequate class representative.
Plaintiff has also presented a declaration from an accountant, Peter Banos, who
testifies as to the basis for his valuation of the damages from the various alleged Labor
Code violations. He discusses in some detail how he calculated damages, including for
defendant’s practice of rounding off time worked by its employees when they clocked
in and out of their shifts, as well as violations due to failure to provide meal and rest
breaks, overtime wages, accurate wage statements, and full final wages upon
termination. In addition, he states that he concluded that plaintiff and virtually all of
6
the other class members experienced the alleged violations, particularly time rounding
that resulted in underpayment of their wages and denial of meal and rest breaks.
Thus, plaintiff has now adequately shown that there is a community of interest
between the class members, that the class members share similar claims and that the
named plaintiff suffered the same types of violations as the other class members, and
that the named plaintiff would be an adequate class representative. As a result, the
court intends to grant the motion for certification of the class for the purpose of
settlement.
2. Preliminary Approval of Class Settlement
“The trial court has broad discretion to determine whether the settlement is fair.
It should consider relevant factors, such as the strength of plaintiffs' case, the risk,
expense, complexity and likely duration of further litigation, the risk of maintaining
class action status through trial, the amount offered in settlement, the extent of
discovery completed and the stage of the proceedings, the experience and views of
counsel, the presence of a governmental participant, and the reaction of the class
members to the proposed settlement.” (Dunk v. Ford Motor Company (1996) 48 Cal.
App. 4th 1794, 1801, citation omitted.)
“[I]n the final analysis it is the Court that bears the responsibility to ensure that
the recovery represents a reasonable compromise, given the magnitude and
apparent merit of the claims being released, discounted by the risks and expenses of
attempting to establish and collect on those claims by pursuing litigation. The court
has a fiduciary responsibility as guardians of the rights of the absentee class members
when deciding whether to approve a settlement agreement.” (Kullar v. Foot Locker
Retail (2008) 168 Cal. App. 4th 116, 129.)
Here, plaintiff has now submitted several new or amended declarations to
support the motion to approve the settlement. In particular, plaintiff has submitted the
declaration of his accountant, Peter Banos, who opines as to the value of the various
claims. He concludes that the potential damages are as much as $2,040.248.
Obviously, the proposed settlement of $775,000 is considerably less than the full
potential damages, which suggests that the settlement may not be fair or reasonable.
However, plaintiff’s counsel opines that the settlement amount is reasonable
under the circumstances, particular since several of the claims will be difficult to prove,
either because defendant did not keep complete records of some events such as rest
breaks, or because some of the claimed violations were arguably not actually violations
of the Labor Code. Also, defendant has taken the position that plaintiff has less than a
50% chance of prevailing if the case went to trial, and therefore defendant is unwilling
to pay more than $775,000 to settle the case. Plaintiff’s counsel states that, in his
experience, defendants in these types of wage and hour cases frequently refuse to
settle for more than 35% or 40% of the total potential damages, and that they usually
prefer to go to trial rather than pay more. Plaintiff’s counsel also admits that some of
the claims may be difficult to prove and trial and thus have little or no value. Thus, it
7
does appear that the amount of the settlement is reasonable and fair under the
circumstances.
Plaintiff’s counsels’ declarations also establish that the attorneys are highly
experienced and qualified to act as class counsel. It also appears that there was fairly
extensive discovery in the case. The fact that the settlement was reached with the
assistance of a mediator after arm’s length negotiations also supports the idea that the
settlement was fair and reasonable.
It is also reasonable that the settlement does not require the class members to fill
out a claim form or do anything else to receive the settlement money. In fact, they
must affirmatively opt out if they do not wish to be part of the settlement. In addition,
any amounts that are not paid out to the class members will not revert back to
defendant, but instead will escheat to the State Department of Industrial Relations
Unpaid Wages Fund. The release of claims language in the settlement also seems
reasonable, since only the claims being released are those alleged in the lawsuit, not
other potential claims that the class members may have based on other facts. These
elements all weigh in favor of the reasonableness of the settlement. Therefore, the
court intends to find that the amount of the proposed settlement is fair and reasonable.
On the other hand, the payment of $15,000 as an enhancement award to
plaintiff is excessive. Plaintiff states that he worked about 30 hours on the case,
including phone conferences, answering discovery, producing documents, and
attending his deposition. If we simply divide the enhancement award by the number of
hours plaintiff worked on the case, plaintiff’s time would be worth $500 per hour. By
contrast, the other class members will only receive $0.24 per hour that they worked
during the class period, which results in an average payment to the class members of
$359.10 per member. In other words, the class representative will receive over 41 times
as much money as the average class member simply because of the enhancement
award.
Plaintiff has not presented any evidence that would tend to show that he did so
much work or that the quality of his work was so extraordinary that he deserves this type
of windfall for being the class representative. Therefore, the court intends to reduce the
requested enhancement significantly. The court finds that a payment of $7,500 to the
class representative will adequately compensate him for his time spent on the case.
Attorney’s Fees and Costs
Plaintiff’s counsel seeks a fee award based on one-third of the gross settlement.
There has been considerable debate in the Courts of Appeal as to whether a
percentage fee should be permitted in class action settlements, or whether the courts
should employ the lodestar fee calculation method. However, the California Supreme
Court recently determined that a percentage fee method is allowable where there is a
common fund settlement.
“Whatever doubts may have been created by Serrano III [citation], or the Court
of Appeal cases that followed, we clarify today that use of the percentage method to
8
calculate a fee in a common fund case, where the award serves to spread the
attorney fee among all the beneficiaries of the fund, does not in itself constitute an
abuse of discretion. We join the overwhelming majority of federal and state courts in
holding that when class action litigation establishes a monetary fund for the benefit of
the class members, and the trial court in its equitable powers awards class counsel a
fee out of that fund, the court may determine the amount of a reasonable fee by
choosing an appropriate percentage of the fund created.” (Laffitte v. Robert Half
Intern. Inc. (2016) 1 Cal.5th 480, 503.)
However, the Supreme Court also observed that the trial court has discretion to
double-check a proposed fee percentage award by using the lodestar method. “Nor
do we perceive an abuse of discretion in the court's decision to double check the
reasonableness of the percentage fee through a lodestar calculation. As noted earlier,
‘[t]he lodestar method better accounts for the amount of work done, while the
percentage of the fund method more accurately reflects the results achieved.’
[Citation.] A lodestar cross-check thus provides a mechanism for bringing an objective
measure of the work performed into the calculation of a reasonable attorney fee. If a
comparison between the percentage and lodestar calculations produces an imputed
multiplier far outside the normal range, indicating that the percentage fee will reward
counsel for their services at an extraordinary rate even accounting for the factors
customarily used to enhance a lodestar fee, the trial court will have reason to
reexamine its choice of a percentage. [Citation.]” (Id. at p. 504.)
Here, plaintiff’s counsel seeks fees equivalent to one-third of the total gross
settlement. Also, plaintiff’s counsel has now provided information about their hourly
rates and time spent on the case so that the court can perform a lodestar calculation
in order to double-check the reasonableness of the requested fees. Mr. Farley
estimates that the lodestar value of his firm’s work on the case is $192,000, based on 320
hours of work billed at $600 per hour. (Farley decl., ¶ 53.) The firm also incurred actual,
out-of-pocket costs of $14,862.12. (Ibid.) Mr. Majarian also billed $16,240 in fees based
on 23.20 hours billed at $700 per hour, plus costs of $5,989.57. (Majarian decl., ¶ 8.)
Thus, the total lodestar fees for plaintiff’s counsel are $208,240, plus combined costs of
$20,851.69. (Ibid.) Co-counsel will split the award of fees 60/40, with Farley receiving
60% of the fees and Majarian receiving the remaining 40%. (Id. at ¶ 9.)
The court finds that the requested fees of $258,333.33 are reasonable and should
be approved. While the requested amount is somewhat higher than the basic lodestar
amount incurred by plaintiff’s counsel, it is not so much higher as to be unreasonable on
its face, and in fact it is probably fair to allow plaintiff’s counsel to recover somewhat
more than the base lodestar amount to compensate them for the risks and
uncertainties of taking the case on a contingent fee basis. As a result, the court intends
to approve the requested fees, as well as the request for an award of counsel’s actual,
out-of-pocket costs of up to $30,000.
Pursuant to CRC 3.1312 and CCP §1019.5(a), no further written order is necessary.
The minute order adopting this tentative ruling will serve as the order of the court and
service by the clerk will constitute notice of the order.
10
(28) Tentative Ruling
Re: Meyers v. Hanks
Case No. 17CECG02094
Hearing Date: February 27, 2018 (Dept. 501)
Motion: By Plaintiff Theresa Meyers for an order appointing referee to sell
real property and apportion costs.
Tentative Ruling:
To grant the motion. Mr. Greg Kosareff is appointed as referee with the authority
detailed below.
Plaintiff will submit an order to the Court consistent with this ruling within five days
of this order. Parties are ordered to cooperate with Mr. Kosareff in the fulfillment of his
duties.
To reserve the issue of damages to a more appropriate legal setting.
Explanation:
The Court has the inherent power to appoint a referee in a partition action (CCP
§§ 873.010, et al.; See Richmond v. Dofflemyer (1980) 105 Cal.App.3d 745, 755 (section
873.010 is not mandatory, but a referee is to be appointed “only where it is determined
that a referee is necessary or would be desirable or helpful” in a partition action.)
Here, it does appear that there is evidence that the parties have irreconcilable
differences and that the appointment of a referee would be helpful. Further, the cost
for the referee does not appear to be prohibitive since the declarations indicate that it
will be paid out of the already agreed-to commissions. The referee is willing to take the
task on.
The Court will reserve any decision on damages incurred by movant for a later
date.
Therefore, Mr. Kosareff is hereby appointed referee pursuant to Code of Civil
Procedure §§638-645.1, with authority to sell the property at public auction to the
highest bidder for cash on notice duly given in the manner required for the sale of real
property on execution, or a private sale in the event the referee shall determine that a
private sale will be the most beneficial to all parties having interests therein, in which
event the private sale shall be conducted in the manner and as required in private
sales of real property estates of deceased persons as required by law.
The referee need not obtain the consent of the parties to list the real property or
accept offers for its sale, or do any other act necessary to sell the real property. Any
11
party with keys to the property shall give them to the receiver within 5 days of being
served with this order. The referee, after making the sale of the real property, is hereby
directed to report to this court his or her proceedings thereon, and, on confirmation of
the sale of the real property by this court and the payment of the purchase price
thereof, the referee is hereby authorized and directed to execute and deliver a deed
of the real property sold to the purchaser thereof.
Unless modified by any order confirming sales hereafter entered herein, the
proceeds from the sale shall be applied after the confirmation of the sale as follows:
a. To pay expenses connected with the sale of the property;
b. To pay the costs of reference, including fees and disbursements of the referee.
c. Unless the Court orders otherwise in the interim, the residue is to be deposited
with the Court pending a judgment or other mechanism for apportionment among the
parties.
Pursuant to California Rules of Court, rule 3.1312, subdivision (a), and Code of
Civil Procedure section 1019.5, subdivision (a), no further written order is necessary. The
minute order adopting this tentative ruling will serve as the order of the court and
service by the clerk will constitute notice of the order.
Tentative Ruling
Issued By: MWS on 02/26/18
(Judge’s initials) (Date)
12
Tentative Rulings for Department 502 (30)
Tentative Ruling
Re: Marcelo Rivas v. Robert Gonzalez
Superior Court No. 17CECG03597
Hearing Date: Tuesday February 27, 2018 (Dept. 502)
Motion: Defendants’ Demurrer and Motion to Strike
Tentative Ruling:
To deny Defendants’ request that Plaintiff’s Complaint be deemed a First
Amended Complaint.
To overrule the demurrer in its entirety.
To deny the motion to strike
Defendants are granted 10 days leave to file an answer. The time in which the answer
may be filed will run from service by the clerk of the minute order. (Code Civ. Proc., §
472b.)
Explanation:
Demurrer
Code Civ. Proc., § 430.10, subd. (f) – failure to separately state causes of action
A complaint that combines multiple, “novel” causes of action into a single cause of
action is defective and subject to special demurrer for uncertainty. (Zumbrun v.
University of Southern California (1972) 25 Cal.App.3d 1, 9 emphasis added.) The first
cause of action does not suffer from this infirmity as it pleads only a claim for
declaratory relief.
Code Civ. Proc., § 430.10, subd. (f) – failure to attach written agreement
Plaintiff has now filed the agreement.
Code Civ. Proc., § 430.10, subd. (g) – failure to allege whether contract is oral/written
Plaintiff has alleged the agreement is partly written and partly oral.
13
Motion to Strike
Code Civ. Proc., § 436, subd. (b) – Code of Civ. Proc., § 761.020
The complaint is verified.
Code Civ. Proc., § 436, subd. (a)- Attorney’s fees
The written agreement clearly sets forth the basis for recovery of attorneys’ fees
Pursuant to California Rules of Court, rule 3.1312(a), and Code of Civil Procedure
section 1019.5, subdivision (a), no further written order is necessary. The minute order
adopting this tentative ruling will serve as the order of the court and service by the clerk
will constitute notice of the order.
Tentative Ruling
Issued By: DSB on 02/26/18
(Judge’s initials) (Date)
14
(17) Tentative Ruling
Re: In re California Management Company, Inc. Cases
Court Case No. 17JCCP04915
Hearing Date: February 27, 2018 (Dept. 502)
Motions: 1. Colligere Farm Management Company’s Demurrer to Complaint
2. Calif. Farm Management Co., Inc.’s Demurrer to Marcos Rentaria
Ag. Services, Inc.’s Amended Answer
3. Calif. Farm Management Co., Inc.’s Demurrer to Tapestry
Vineyards, Inc., dba Frey Farming Vineyard Management’s
Amended Answer
4. Calif. Farm Management Co., Inc.’s Demurrer to Roseann R.
Maravilla’s Answer
5. Calif. Farm Management Co., Inc.’s Demurrer to Precision Hay
Co.’s, Mike McCurdy’s, and Desmond Wilson’s Amended Answer
Tentative Ruling:
To overrule Colligere Farm Management Company’s Demurrer to Complaint.
Colligere shall file and serve its answer within 10 days of the clerk’s service of this minute
order.
With respect to the demurrers to the Answer and Amended Answer to overrule
the demurrers to the first, second, sixth, seventh, ninth, fifteenth, sixteenth, nineteenth,
twenty-third and twenty-seventh affirmative defenses; to sustain the demurrers with
leave to amend as to the tenth, twelfth and seventeenth affirmative defenses; and to
sustain without leave to amend as to the third, fourth, fifth, eighth, eleventh, eighteenth,
twentieth, twenty-first, twenty-fourth, and twenty-eighth affirmative defenses.
Amended answers shall be filed and served within 10 days of the clerk’s service of this
minute order. All new allegations shall be in boldface typefont.
Explanation:
Colligere’s Demurrer to Complaint
First Cause of Action:
A demurrer to a complaint may be general or special. A general demurrer
challenges the legal sufficiency of the complaint on the ground it fails to state facts
sufficient to constitute a cause of action. (Code Civ. Proc., § 430.10, subd. (e).) A
special demurrer challenges other defects in the complaint, including whether a
pleading is uncertain. (Code Civ. Proc., § 430.10, subd. (f).) The term uncertain includes
the issue of whether the pleading is “ambiguous and unintelligible.” (Ibid.) A demurrer
for uncertainty should be sustained if the complaint is drafted in such a manner that the
15
defendant cannot reasonably respond, i.e., the defendant cannot determine what
issues must be admitted or denied, or what counts are directed against the defendant.
(Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 616.)
Colligere raises both general and special demurrers to the first cause of action.
The first cause of action is not uncertain. It is perfectly clear that Cal. Farm is pleading
breach of written contract and the basis of its claim. The special demurrer is overruled.
Contract:
The elements of a cause of action for breach of contract are (1) the existence of
the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's
breach, and (4) the resulting damages to the plaintiff. (Oasis West Realty, LLC v.
Goldman (2011) 51 Cal.4th 811, 821.) Initially, Colligere challenges the adequacy of
Cal. Farm’s allegation of the contractual obligation to pay the assessment. A plaintiff
may plead the existence of a written contract by alleging its terms verbatim, by
alleging its making and attaching and incorporating a copy of the contract, or by
alleging the substance of its material terms. (Scolinos v. Kolts (1995) 37 Cal.App.4th 635,
640; Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189,
198-199.)
Cal. Farm has done both. It has attached a variety of documents which it
alleges form a written contract and alleged specifically that it and Colligere “entered
into a written contract whereby [Cal. Farm] would provide workers compensation
coverage to Colligere and whereby Colligere would pay its contributions and
assessments.” (Complaint at ¶ 29.) Colligere however, focuses only on one document
as the basis for the written contract claim, Exhibit C, the Indemnity Agreement and
Power of Attorney, Form A4-8. Colligere claims nothing in Exhibit C obligates it to pay
the sum demanded in the complaint, or any assessment at all.
It is true that to the extent the factual allegations conflict with the content of the
exhibits to the complaint, the court relies on and accepts as true the contents of the
exhibits and treats as surplusage the pleader's allegations as to the legal effect of the
exhibits. (Barnett v. Fireman's Fund Ins. Co. (2001) 90 Cal.App.4th 500, 505.) And in ruling
on a demurrer the plain meaning of an attached contract controls unless (1) the
plaintiff alleges the existence of “specified parol evidence” contrary to that meaning
and (2) the contract is reasonably susceptible of the plaintiff's claimed interpretation.
(George v. Automobile Club of Southern California (2011) 201 Cal.App.4th 1112, 1122,
1127–28.)
Colligere claims that Exhibit C lacks necessary terms, asserting that that Exhibit C
lacks an expiration date, contains no method of determining breach, does not provide
for terms of payment, collection, and is silent on how damages shall be calculated –
thus, is too vague to be enforced. Nevertheless, “[n]either law nor equity requires that
every term and condition be set forth in a contract.” (Frankel v. Board of Dental
Examiners (1996) 46 Cal.App.4th 534, 545.) Thus, “usual and reasonable terms found in
similar contracts may be considered, unexpressed provisions of the contract may be
inferred from the writing, external facts may be relied upon, and custom and usage
16
may be resorted to in an effort to supply a deficiency if it does not alter or vary the
terms of the agreement.” (Ibid.; Midwest Television, Inc. v. Scott, Lancaster, Mills & Atha,
Inc. (1988) 205 Cal.App.3d 442, 451.) A court may find an implied contract provision
only if (1) the implication either arises from the contract's express language or is
indispensable to effectuating the parties' intentions; (2) it appears that the implied term
was so clearly within the parties' contemplation when they drafted the contract that
they did not feel the need to express it; (3) legal necessity justifies the implication; (4)
the implication would have been expressed if the need to do so had been called to
the parties' attention; and (5) the contract does not already address completely the
subject of the implication. (Civ. Code, § 1655.)
Here, the contract at issue, Exhibit C, is a state-drafted contract and Cal. Farm is
not permitted to vary the terms. Moreover, the existence of self-insured workers’
compensation insurance groups is statutory, and their existence is highly regulated.
Thus, each law and regulation applying to self-insured groups must be read into each
contract and can supply the missing terms, as each party to the self-insurance contract
is bound to know the applicable law.
The law provides that current and former group members in a given plan year
may be subject to special assessments in subsequent years on approval of OSIP. (See
Cal. Code Regs., tit. 8, § 15477, subd. (b)(3); see also § 15479 [CALDIR may enforce “the
liability of group members for any unpaid contributions and assessments”].) A contract
that leaves an amount to be paid to future determination or agreement is not too
vague to be enforced, particularly where applicable statutes and rules set forth a
procedure for determining the amount. (Elite Show Services, Inc. v. Staffpro, Inc. (2004)
119 Cal.App.4th 263, 268-269 [agreement to pay prevailing party’s attorney’s fees].)
“ ‘When reviewing whether a plaintiff has properly stated a cause of action for
breach of contract, we must determine whether the alleged agreement is ‘reasonably
susceptible’ to the meaning ascribed to it in the complaint. [Citation.] “ ‘So long as the
pleading does not place a clearly erroneous construction upon the provisions of the
contract, in passing upon the sufficiency of the complaint, we must accept as correct
plaintiff's allegations as to the meaning of the agreement.’ ” ' ” (Marzec v. Public
Employees' Retirement System (2015) 236 Cal.App.4th 889, 909.)
Exhibit C, read along with the relevant law, and given the interpretation alleged
in the Complaint is susceptible of the interpretation given it by Cal. Farm, that it is an
agreement that Colligere agreed to pay lawful special assessments by Cal. Farm in
exchange for the provision of workers’ compensation coverage.
Damages:
Colligere asserts Cal. Farm has failed to allege the existence of any damages
caused by Colligere’s breach. Colligere is wrong. Cal. Farm has alleged the existence
of a contract to pay assessments, an assessment of $257,205.36, and that Colligere has
failed to pay the assessed sum of $257,205.36. (Complaint at ¶¶ 26, 27, 29, 31.) There is
no requirement under the law that the reason for the assessment be a worker’s
compensation claim of Colligere’s.
17
Statute of Limitations:
“A demurrer may be sustained on statute of limitations grounds if the time bar
clearly and affirmatively appears on the face of the complaint.” (Doe v. Roman
Catholic Archbishop of Los Angeles (2016) 247 Cal.App.4th 953, 960.) Colligere claims
that the first cause of action is time-barred because Cal. Farm’s Board of Trustees knew
of the financial deficits prompting the assessment no later than 2012, but this action was
filed in 2017. Indeed, the shortfalls began to occur in 2006. Thus, Colligere argues, this
action is barred by the four year statute of limitations imposed on actions for breach of
written contracts by Code of Civil Procedure section 337(1).
However, Colligere is not being sued for causing the financial deficits suffered by
Cal. Farm. It is being sued for refusing to pay the particular assessment issued on August
8, 2016, and due on October 1, 2016. (See Exhibit F) This complaint filed, October 12,
2017, is timely.
Second Cause of Action:
The terms of an express contract “are stated in words” (Civ. Code, § 1620), while
the terms and the existence of an implied contract “are manifested by conduct.” (Civ.
Code, § 1621.) The second cause of action alleges the existence of an implied
contract whereby Cal. Farm provided workers’ compensation coverage to Colligere in
exchange for Colligere’s promise to pay its contributions and assessments. (Complaint
at ¶ 34.) Given that the Complaint alleges that Colligere applied for and was granted
consent to self-insure and became a paying member of Cal. Farm. In 2008, an implied
contract to pay special assessments has been clearly alleged. The demurrer for
uncertainty is overruled.
The second cause of action is not barred by the two year statute of limitations
provided by Code of Civil Procedure 339(1), because the suit was filed within 13 months
of Colligere’s refusal to pay its assessment.
Demurrers to Answers
The determination whether an answer states a defense is governed by the same
principles which are applicable in determining if a complaint states a cause of action.
(South Shore Land Co. v. Petersen (1964) 226 Cal.App.2d 725, 732.) A general demurrer
to the answer raises the objection that the answer does not state facts sufficient to
constitute a defense. (Code Civ. Proc., § 430.20, subd. (a).) Here, Cal. Farm demurs to
the 1st-12th, 15th – 24th, and 26th – 28th affirmative defenses. The court has reviewed each
Answer and Amended Answer and each Demurrer. As they appear word for word
identical, the Court treats them as one motion.
“Under Code of Civil Procedure section 431.30, subdivision (b)(2), the answer to a
complaint must include ‘[a] statement of any new matter constituting a defense.’ The
phrase ‘new matter’ refers to something relied on by a defendant which is not put in
issue by the plaintiff. [Citation.] Thus, where matters are not responsive to essential
18
allegations of the complaint, they must be raised in the answer as ‘new matter.’
[Citation.] Where, however, the answer sets forth facts showing some essential
allegation of the complaint is not true, such facts are not ‘new matter,’ but only a
traverse. [Citation.]” (State Farm Mut. Auto. Ins. Co. v. Superior Court (1991) 228 Cal.
App. 3d 721, 725.)
The general rule is that the same pleading of “ultimate facts” rather than
evidentiary matter or legal conclusions is required in pleading an answer as in pleading
a complaint. The answer must aver facts “as carefully and in as much detail as the
facts which constitute the cause of action and which are alleged in the complaint.”
Conclusions of law are not sufficient to state a valid defense, and will not withstand a
general demurrer. (See In re Quantification Settlement Agreement Cases (2011) 201
Cal.App.4th 758, 812–13, quoting FPI Dev., Inc. v. Nakashima (1991) 231 Cal.App.3d 367,
384.)
First Affirmative Defense
The first affirmative defense provides that Cal. Farm’s complaint fails to state
facts sufficient to constitute a cause of action. Defendants’ assertion that the
complaint fails to allege sufficient facts to state a claim is not a statement of new
matter; it is a challenge to the legal sufficiency of the complaint. (Code Civ. Proc., §
431.30, subd. (b)(2).) This objection is never waived (See Code Civ. Proc., § 430.80,
subd. (a)) and may be raised in an answer, as well as a demurrer. (See Code Civ. Proc.,
§ 430.10, subd. (e).)
The demurrer is overruled.
Second Affirmative Defense
Cal. Farm argues that the second affirmative defense based on the statute of
limitations fails because (1) the facts alleged in the complaint demonstrate that its
claims are not barred by the statute of limitations, and (2) Code of Civil Procedure
sections 337, subdivision (3) and 339, subdivision (2) do not apply given the facts
alleged in the complaint.
Code of Civil Procedure section 458 provides that a party need not allege facts
supporting a statute of limitations defense, but must only state “that the cause of action
is barred by the provisions of Section ___ (giving the number of the section and
subdivision thereof, if it is so divided, relied upon).” The second affirmative defense is in
this format and is adequately alleged. The demurrer is overruled.
Third, Fourth, Fifth, Eighth, Ninth, Eleventh, Eighteenth, Twenty-Fourth, and Twenty-
Eighth Affirmative Defenses
Cal. Farm argues that the third, fourth, fifth, eighth, ninth, eleventh, eighteenth,
twenty-fourth, and twenty-eighth affirmative defenses fail to allege facts sufficient to
constitute a defense because they are based in tort and the complaint alleges causes
of action for breach of contract. Cal. Farm further contends that even if the tort-based
19
affirmative defenses applied to its claims, defendants have not pled sufficient facts
supporting the elements of the defenses.
Defendants assert that they may properly allege tort-based defenses in this case,
citing Kransco v. American Empire Surplus Lines Ins. Co. (2000) 23 Cal.4th 390 (Kransco).
Kransco does not help defendants. Kransco involved an action for breach of the
covenant of good faith and fair dealing brought by an insured against an insurer. (Id.
at p. 393-400.) On appeal, the court held that the insurer’s comparative negligence
and bad faith defenses were not viable affirmative defenses. (Id., at pp. 410-12.) The
Court opined that an insurer’s breach of the covenant of good faith and fair dealing is
governed by tort principles, but an insured’s breach of the covenant is not a tort. (Id., at
p. 404.) Because an insured’s breach of the covenant does not sound in tort, the
insured’s contractual breach of an express policy provision cannot be raised by the
insurer as a defense in a bad faith action brought against it by the insured. (Id., at p.
405.) Thus, Kransco does not stand for the proposition that defendants may assert tort-
based defenses to Cal. Farm’s claims for breach of contract.
The third affirmative defense of comparative fault, the fourth affirmative defense
of negligence of third parties, the fifth affirmative defense of third party fault, the eighth
affirmative defense of willful or intentional acts of third parties, the eleventh affirmative
defense of assumption of the risk, the eighteenth affirmative defense of proximate
cause, the twenty-fourth affirmative defense of alternate cause, and the twenty-eighth
defense of indemnity from third parties, as pleaded, sound in tort. Because the
complaint pleads only breach of contract claims, these tort-based defenses are not
appropriate. The demurrers to these affirmative defenses are sustained without leave
to amend.
The ninth affirmative defense – despite its name: “no violation of duty” – alleges
that defendants performed all of the obligations under the alleged agreements such
that they have not committed any breach of contract. Accordingly, the ninth
affirmative defense only challenges Cal. Farm’s ability to prove an element of its
breach of contract claims, and is a traverse. (Oasis West Realty, LLC v. Goldman,
supra, 51 Cal.4th at p. 821.) Accordingly, the demurrer to the ninth affirmative defense
is overruled.
Sixth Affirmative Defense
Cal. Farm argues that the Court should sustain its demurrer to the sixth affirmative
defense of failure to mitigate because defendants do not plead facts describing how it
could have mitigated its damages.
“‘It is generally held to be the duty of the defendant to plead the facts in
mitigation of damages if he would rely thereon.’” (Steelduct Co. v. Henger-Seltzer Co.
(1945) 26 Cal.2d 634, 655.) Here, defendants allege that Cal. Farm failed to mitigate its
damages because it was aware, as early as 2012, that a financial deficit existed, but it
did not take any corrective action for four years. Accordingly, defendants have pled
facts describing how Cal. Farm failed to mitigate its damages.
20
The demurrer is overruled.
Seventh, Fifteenth, Sixteenth, Twenty-Third, and Twenty-Seventh Affirmative
Defenses
Cal. Farm argues that the Court should sustain its demurrer to these affirmative
defenses because the defenses are mere denials of its claims and defendants do not
plead facts supporting their denials.
The seventh affirmative defense of full performance, the fifteenth affirmative
defense of speculative damages, sixteenth affirmative defense of lack of standing, the
twenty-third affirmative defense of no breach, and the twenty-seventh affirmative
defense of no resulting damages challenge Cal. Farm’s ability to prove elements of its
breach of contract claims. (Oasis West Realty, LLC v. Goldman, supra, 51 Cal.4th at p.
821.) The defenses are mere traverses and the demurrers are overruled.
Tenth Affirmative Defense
Cal. Farm argues that the tenth affirmative defense of offset fails because
defendants do not allege any facts showing that the parties had cross-demands for
money. The affirmative defense of offset requires “cross-demands for money [to] have
existed between persons at any point in time when neither demand was barred by the
statute of limitations.” (Code Civ. Proc., § 431.70.) The tenth affirmative defense does
not include any facts showing that cross-demands for money existed between the
parties at any point in time. Consequently, the demurrer to the tenth affirmative
defense for failure to allege a defense is sustained with leave to amend.
Twelfth Affirmative Defense
Cal. Farm argues that the Court should sustain its demurrer to the twelfth
affirmative defense because defendants do not allege facts showing that it
intentionally relinquished a known right.
Defendants allege that Cal. Farm’s claims are barred by the doctrine of release
because Cal. Farm’s Board of Trustees became aware of the deficit prior to 2012, but it
failed to take timely action to resolve the deficit. Defendants contend that Cal Farm
thereby intentionally relinquished a known right such that it is barred from recovering
damages.
Based on these allegations, the twelfth affirmative defense is based on waiver,
not on an executed release of claims. “Waiver is the intentional relinquishment of a
known right after full knowledge of the facts” (DRG/Beverly Hills, Ltd. v. Chopstix Dim
Sum Cafe & Takeout III, Ltd. (1994) 30 Cal.App.4th 54, 59.) Here, defendants allege
sufficient facts showing that Cal. Farm had knowledge of the deficit and, thereafter,
failed to timely resolve it. However, defendants do not plead facts demonstrating that
Cal. Farm’s failure to timely resolve the deficit constituted an intentional relinquishment
of a known right.
21
Thus, the demurrer to the twelfth affirmative defense on the ground of failure to
allege sufficient facts to state a defense is sustained with leave to amend.
Seventeenth Affirmative Defense
Cal. Farm alleges that the seventeenth affirmative defense fails because the
alleged agreements do not set out perpetual liability; even if the alleged contracts
were in perpetuity, such an agreement is not void under California law; and the
defense is pled as a terse legal conclusion.
The seventeenth affirmative defense alleges that the contract alleged in the
complaint is void or unenforceable because the contract sets out liability into
perpetuity. The seventeenth affirmative defense, as alleged, fails to state sufficient facts
showing that the alleged contract is void for lack of a duration clause. The contract
provision referenced by defendants simply provides that defendants are jointly and
severally liable for paying the liabilities of group members resulting from an occurrence
with a date of injury period their period of membership. (Complaint, Ex. C.) Nothing
pled, or judicially noticeable, suggests that the membership in a self-insured group is
perpetual, thus the duration of the contract does not continue in perpetuity.
Accordingly, the demurrer to the seventeenth affirmative defense on the ground of
failure to state a defense is sustained with leave to amend.
Nineteenth Affirmative Defense
Cal. Farm argues that the Court should sustain its demurrer to the nineteenth
affirmative defense of unclean hands because defendants do not: identify the
representatives on the Board of Trustees that purportedly favored other group
members; state the timeframe of the alleged actions; describe how the representatives
favored other group members; explain how the favoritism prejudiced them; or show
that the favoritism has any bearing on the alleged breach of contract.
Affirmative defenses need only be pled in “ultimate facts” rather than
evidentiary matter or legal conclusions. The answer must aver facts “as carefully and in
as much detail as the facts which constitute the cause of action and which are alleged
in the complaint.” (See In re Quantification Settlement Agreement Cases, supra, 201
Cal.App.4th at pp. 812–13.) Defendants have met that standard here by alleging that
members of Cal. Farm’s Board of Trustees, who are representatives of members of the
self-insured group, influenced assessment rate distributions in a manner that favored
those members that had representatives on the Board of Trustees. These acts and
others allegedly substantially contributed to Cal. Farm’s deficit. The identities of the
Board Members and the time frame involved are evidentiary matter which can be
found out in discovery. Accordingly, the demurrer to the nineteenth affirmative defense
is overruled.
Twentieth Affirmative Defense
Cal. Farm argues that the twentieth affirmative defense of laches is unavailable
because the claims for breach of contract are actions in law for which laches is not a
22
defense. This is correct. In Abbott v. City of Los Angeles (1958) 50 Cal.2d 438, the high
court held that the equitable doctrine of laches was not available as an affirmative
defense to a contract action for money damages. (Id. p. 498.) The demurrer to this
affirmative defense is sustained without leave to amend.
Twenty-First Affirmative Defense
Cal. Farm argues that the twenty-first affirmative defense fails because unjust
enrichment is a cause of action, not a defense.
Unjust enrichment is not a cause of action, nor a defense. (Melchior v. New Line
Productions, Inc. (2003) 106 Cal.App.4th 779, 793 [Unjust enrichment is not a cause of
action, however, or even a remedy, but rather “ ‘ “a general principle, underlying
various legal doctrines and remedies” ’ .... [Citation.] It is synonymous with restitution.
[Citation.]”].) Defendants cite no legal authority, and the Court is aware of none,
providing that unjust enrichment is an affirmative defense.
Therefore, the demurrer to the twenty-first affirmative defense is sustained without
leave to amend.
Pursuant to California Rules of Court, rule 3.1312(a) and Code of Civil Procedure
section 1019.5, subdivision (a), no further written order is necessary. The minute order
adopting this tentative ruling will serve as the order of the court and service by the clerk
will constitute notice of the order.
Tentative Ruling
Issued By: DSB on 02/26/18
(Judge’s initials) (Date)
23
Tentative Rulings for Department 503
(2)
Tentative Ruling
Re: Soto et al. v. Rocha
Superior Court Case No. 17CECG00261
Hearing Date: February 27, 2018 (Dept. 503)
Motion: Petition to Compromise a Minor’s Claim
Tentative Ruling:
To deny without prejudice. Petitioner must file an amended petition, with
appropriate supporting papers and proposed orders, and obtain a new hearing date
for consideration of the amended petition. (Super. Ct. Fresno County, Local Rules, rule
2.8.4.)
Explanation:
The attorney seeks fees in the amount of 25% of gross. The attorney is entitled to
25% of the net settlement (gross settlement minus costs).
The distribution of the proceeds is not properly supported. The proceeds may be
delivered to the petitioner/mother to be held in trust for the minor if the requirements of
Probate Code §3401(c) have been satisfied. However, the requirements of Probate
Code §3401(c) have not been satisfied. There is no evidence that the petitioner/parent
has provided a written assurance, verified by oath that the total estate of the minor,
including the money or other property to be paid or delivered to the parent, does not
exceed five thousand dollars ($5,000) in value. Nor is there an attachment 19(5) as
required by the petition.
Pursuant to California Rules of Court, rule 3.1312 and Code of Civil Procedure
section 1019.5(a), no further written order is necessary. The minute order adopting this
tentative ruling will serve as the order of the court and service by the clerk will constitute
notice of the order.
Tentative Ruling
Issued By: KAG on 02/26/18
(Judge’s initials) (Date)
24
03
Tentative Ruling
Re: Taylor v. Community Regional Medical Center Fresno
Case No. 15CECG00142
Hearing Date: February 27, 2018 (Dept. 503)
Motion: Defendant Fresno Community Hospital and Medical
Center’s Motion for Summary Judgment
Tentative Ruling:
To grant defendant Fresno Community Hospital and Medical Center’s motion for
summary judgment. (Code Civ. Proc. § 437c.)
Explanation:
“The standard of care in a medical malpractice case requires that physicians
exercise in diagnosis and treatment that reasonable degree of skill, knowledge and
care ordinarily possessed and exercised by members of the medical profession under
similar circumstances. [Citations.] ‘“The standard of care against which the acts of a
physician are to be measured is a matter peculiarly within the knowledge of experts; it
presents the basic issue in a malpractice action and can only be proved by their
testimony [citations], unless the conduct required by the particular circumstances is
within the common knowledge of the layman.” [Citations.]’ [Citation.]” (Munro v.
Regents of University of California (1989) 215 Cal.App.3d 977, 983–984.)
“California courts have incorporated the expert evidence requirement into their
standard for summary judgment in medical malpractice cases. When a defendant
moves for summary judgment and supports his motion with expert declarations that his
conduct fell within the community standard of care, he is entitled to summary judgment
unless the plaintiff comes forward with conflicting expert evidence.” (Hutchinson v.
United States (9th Cir. 1988) 838 F.2d 390, 392.)
Here, defendant Fresno Community Hospital and Medical Center has presented
the declaration of its expert in hospital and nursing care, Deborah Mills, R.N., who
opines that defendant’s care and treatment of plaintiff did not fall below the standard
of care and did not cause plaintiff’s injuries. (Mills decl., ¶¶ 9, 10.) Therefore, defendant
has met its burden of showing that plaintiff cannot prevail on her negligence claim
against it, and the burden shifts to plaintiff to submit her own expert declaration
indicating that defendant did breach the standard of care and that the breach
caused plaintiff’s injuries. However, plaintiff has not submitted any opposition or
evidence to raise a triable issue of material fact as to defendant’s breach of the
standard of care. As a result, the court intends to grant summary judgment in favor of
defendant Fresno Community Hospital and Medical Center.
25
Pursuant to CRC 3.1312 and CCP §1019.5(a), no further written order is necessary.
The minute order adopting this tentative ruling will serve as the order of the court and
service by the clerk will constitute notice of the order.
Tentative Ruling
Issued By: KAG on 02/26/18
(Judge’s initials) (Date)
26
(17) Tentative Ruling
Re: The Diocese of San Joaquin v. The Rev. James Snell, et al.
Court Case No. 10CECG00908
Hearing Date: February 27, 2018 (Dept. 503)
Motion: Defendants’ Motion to Dismiss Complaints for Failure to Bring to Trial
Within Five Years [C.C.P. § 583.310]
Tentative Ruling:
To deny the motion to dismiss.
Explanation:
Code of Civil Procedure section 583.310 requires an action “be brought to trial
within five years after the action is commenced against the defendant.” Otherwise,
dismissal of the action is “mandatory and . . . not subject to extension, excuse, or
exception except as expressly provided by statute.” (Code Civ. Proc., § 583.360, subd.
(b).) In computing the time within which an action must be brought to trial, courts must
exclude the time during which “[p]rosecution or trial of the action was stayed or
enjoined.” (Code Civ. Proc., § 583.340(b).) Courts must also exclude the time during
which “[b]ringing the action to trial, for any other reason, was impossible,
impracticable, or futile,” in computing the time within which an action must be brought
to trial. (Code Civ. Proc., § 583.340(c); Bruns v. E–Commerce Exchange, Inc. (2011) 51
Cal.4th 717, 726.) Thus, subdivisions (b) and (c) of section 583.340 represent two
separate tolling conditions. (Gaines v. Fidelity National Title Ins. Co. (2016) 62 Cal.4th
1081, 1087 (Gaines).)
On November 7, 2013, this court issued the following order:
On November 5, 2013 this matter came on for hearing regarding the issue
of whether or not a stay of the proceedings should be imposed until the
case Diocese of San Joaquin et. al., v. John-David Schofield, case No.
08CECG01425 is resolved. After submission of briefs and argument, the
Court STAYS the instant action until the resolution of the case referenced
above. This stay applies to all proceedings in this case. The parties may, if
they wish, stipulate that certain depositions taken in case no.
08CECG01425 will not have to be retaken in this case, but the court leaves
that decision up to the parties.
As to the five year statute, an action must be brought to trial within five
years after it is commenced against the defendant. If not, dismissal is
mandatory on motion of any party, or on the court's own motion. (CCP
583.310, 583.360). The five year statute begins to run when the action is
“commenced against the defendant.” It continues to run until the action
27
is “brought to trial.” (Id.) The parties may extend the five year period by
either written stipulation, or oral agreement entered into in open court
and recorded in the minutes or a transcript of the proceedings. (CCP
583.330). If, as here, the parties fail to stipulate to extend the five year
deadline, the court may still extend the deadline by staying the action
completely. Bruns v. E-Commerce Exch., Inc. (2011) 51 Cal.4th 716. “If a
complete stay is in effect, bringing the action to trial is impossible” and
therefore, that time is excluded from the calculation pursuant to CCP
section 583.340(b) and (c). Id. The “clock” will not begin to run again until
the stay is lifted and the case placed back on the court's active docket.
(Emphasis added.)
Defendants argue that the stay expired when the main action ended in July of
2016 when the California Supreme Court denied certiorari and the Fifth District Court of
Appeal issued the remittitur, focusing on the language of the first paragraph of the
Court’s order (“the Court STAYS the instant action until the resolution of the case
referenced above”). Defendants argue that, because a plaintiff always has the
burden of prosecuting his or her case, plaintiffs here were required to act diligently in
ending the stay. Plaintiffs counter that subdivisions (b) and (c) of section 583.340 are
separate; once a complete stay has been imposed, a plaintiff need not act diligently
to seek relief from the stay. Plaintiffs rely on the last paragraph of the order and
emphasize that this court intended the stay to toll the five-year statute until the case
was restored to the civil active list, which did not occur until December of 2017.
Plaintiffs are correct.
Ocean Services Corp. v. Ventura Port Dist. (1993) 15 Cal.App.4th 1762, is directly
on point. In that matter, the defendant moved to dismiss for failure to bring the case to
trial within five years. However, the trial court found that an order of the Court of
Appeal staying the case tolled the five-year period under Code of Civil Procedure
section 583.340, subdivision (b), and denied the motion. (Id., at pp. 1773-1774.) On
appeal, the defendant argued that the motion should have been granted because,
with reasonable diligence, the plaintiff could have had the stay vacated six months
earlier, and subtracting those six months from the tolling period would have brought the
case past the five-year limit. (Id. at pp. 1773-1774.)
The Court of Appeal rejected this argument. “Code of Civil Procedure section
583.340, subdivision (b), provides that the five-year period ‘shall be’ tolled if
‘[p]rosecution or trial of the action was stayed or enjoined.’ The statute is unconditional
and is intended to have uniform application. ‘“This is consistent with the treatment
given other statutory excuses; it increases certainty and minimizes the need for a
judicial hearing to ascertain whether or not the statutory period has run.” [Citation.] It
also is consistent with the general policy favoring trial over dismissal. (§ 583.130.)’
(Holland v. Dave Altman's R.V. Center (1990) 222 Cal.App.3d 477, 484.)” (Ocean
Services Corp. v. Ventura Port Dist., supra, 15 Cal.App.4th at p. 1774.)
Defendants argue that reliance on Ocean Services is misplaced because the
basis of the Ocean Services decision was lack of jurisdiction, not reasonable diligence.
28
However, the language from the case contradicts this argument: “The five-year statute
was also tolled because the trial court lacked jurisdiction to try the action.” (Ocean
Services Corp. v. Ventura Port Dist., supra, 15 Cal.App.4th at p. 1774 (emphasis added).)
The use of the word “also” demonstrates that the Ocean Services court considered lack
of jurisdiction a secondary argument to the stay argument, and not the sole justification
for the tolling.
Defendants argue that the stay was not “complete” and thus not effective to toll
the five-year statute because plaintiffs could have sought relief from the stay and set a
trial date once the main action ended. But this is generally true of all stays – parties are
always free to seek court relief. Even if this stay was wrongly issued, plaintiffs had no
obligation to seek relief in court. (Ocean Services, supra, 15 Cal.App.4th at 1775.)
In Gaines, supra, 62 Cal.4th 1081, the California Supreme Court held that the
legal effect of the event triggering a stay is what matters: “[t]he label the trial court
uses is not dispositive of the inquiry[,]” and what “matters is whether the order is
functionally in the nature of a stay . . . .” (Gaines, supra, 62 Cal.4th at p. 1092.) The high
court in Gaines examined the nature of the continuance orders before it to determine
whether they were, in fact, continuances the parties could control, or stays they had no
control over, but at no time did the Supreme Court engraft a diligence requirement
onto the “bright-line” stay tolling. Gaines requires that a stay “be functionally in the
nature of a stay.” (Gaines, supra, 62 Cal.4th at p. 1092.) It must be “extrinsic to the
litigation and beyond the plaintiff’s control.” (Ibid.) A stay of the prosecution of the
action qualifies under Code of Civil Procedure section 583.340, subdivision (b), “only
when the stay encompasses all proceedings in the action.” (Id. at p. 1094 (italics in
original).) It is clear that a stay of the entire instant action issued on November 7, 2013
and that stay was not lifted until December 7, 2017. (“This stay applies to all
proceedings in this case[,]” Order dated November 7, 2013.) The five-year statute was
tolled between those two dates.
Pursuant to California Rules of Court, rule 3.1312(a) and Code of Civil Procedure
section 1019.5, subdivision (a), no further written order is necessary. The minute order
adopting this tentative ruling will serve as the order of the court and service by the clerk
will constitute notice of the order.
Tentative Ruling
Issued By: KAG on 02/26/18
(Judge’s initials) (Date)