Tentative Rulings

The Tentative Rulings for Tuesday, May 31, 2022 are:

Re:              Gonzalez, Esperanza Hansen vs. Asset-Backed Lending

Case No.:    VCU284145

Date:             May 31, 2022

Time:             8:30 A.M. 

Dept.             7-The Honorable Bret D. Hillman

Motion:       Defendant’s Motion for Summary Adjudication as to Plaintiff

Tentative Ruling: To grant the motion as to issues 1, 2, 4, 6, 7, 8, and 9. To find issues 3 and 5 moot based on the Court’s granting adjudication as to issues 2 and 4.

Facts

Defendant ABLP’s motion for summary adjudication is limited to Plaintiff Arnulfo Gonzalez’s causes of action for breach of contract, wrongful foreclosure regarding both the Douglas Ave. property and Lewis Lane property intentional misrepresentation, breach of covenant of good faith and fair dealing, slander and intentional interference with prospective economic advantage.

In support, Defendant sets forth the following undisputed material facts.

Arnulfo Gonzalez's first cause of action for breach of contract is based upon the January 27, 2017 Note Secured by Deed of Trust and the June 8, 2017 Modification of Note and Deed of Trust. (Undisputed Material Fact (“UMF”) No. 1) Arnulfo was not a party to the January 27, 2017 Note Secured by Deed of Trust. (UMF Nos. 2, 9, 16, 25, 31.) Arnulfo was not a party to the June 8, 2017 Modification of Note and Deed of Trust. (UMF No. 3, 10, 17, 26, 32.)

Arnulfo asserts a second cause of action for wrongful foreclosure related to the property at 2948 and 2950 East Douglas Avenue, Visalia, California 93292 (“Douglas Property.”) (UMF No. 4.) Defendant ABLP conducted a nonjudicial foreclosure of the Douglas Property on November 22, 2019 pursuant to a Deed of Trust executed by Magnolia Group (“Douglas Deed of Trust”). (UMF No. 5.) Arnulfo was not the trustor under the Douglas Deed of Trust. (UMF No. 6.) Arnulfo did not own the Douglas Property at any point prior to the foreclosure by Defendant ABLP. (UMF Nos. 7, 20, 29, 33.)

Arnulfo’s second cause of action as to wrongful foreclosure of the Douglas Property is based upon alleged breaches of the January 27, 2017 Note Secured by Deed of Trust and the June 8, 2017 Modification of Note and Deed of Trust. (UMF No. 8.)

Arnulfo asserts a third cause of action for wrongful foreclosure related to the property at 1333 Lewis Lane, Tulare, California 93274. (UMF No. 11.) Defendant ABLP conducted a nonjudicial foreclosure of the Lewis Property on June 30,2020, Pursuant to a Deed of Trust executed by Magnolia Group (“Lewis Deed of Trust.”) (UMF No. 12.) Arnulfo was not the trustor under the Lewis Deed of Trust. (UMF No. 13.) Arnulfo did not own the Lewis Property at any point prior to the foreclosure by Defendant ABLP. (UMF Nos. 14, 21, 34.)

Arnulfo’s third cause of action for wrongful foreclosure of the Lewis Property is based upon alleged breaches of the January 27, 201 7 Note Secured by Deed of Trust and the June 8,2017 Modification of Note and Deed of Trust. (UMF No. 15.)

Arnulfo’s fourth cause of action for fraud by intentional misrepresentation is based upon alleged statements about securing financing for the Douglas Property and Lewis Property. (UMF No. 18.) This cause of action alleges that the statements were made with the intention of causing all Plaintiffs to lose Douglas Ave, Lewis Lane and profits for Magnolia Park. (UMF No. 19.) Arnulfo is not an owner of Magnolia Group, Inc. or Magnolia Park, LLC. (UMF Nos. 22 and 23.)

Arnulfo’s fifth cause of action for breach of the covenant of good faith and fair dealing is based upon the January 27, 2017 Note Secured by Deed of Trust and the June 8, 2017 Modification of Note and Deed of Trust. (UMF No. 24.)

Arnulfo asserts a sixth cause of action for slander of title related to the Deed of Trust recorded on the Douglas Property by the Jacobsons in 2018. (UMF No. 27.) Arnulfo alleges that each defendant is, and at all relevant times was, the agent, servant, employee, partner, alter ego, co-conspirator or principal of each other defendant. (UMF No. 28.)

Arnulfo’s seventh cause of action for intentional interference with prospective economic advantage is based upon Plaintiffs attempt to refinance their existing loans from ABLP REIT. (UMF No. 30.)

Authority and Analysis

A motion for summary adjudication may be made by itself or as an alternative to a motion for summary judgment and shall proceed in all procedural respects as a motion for summary judgment.  (Code Civ. Proc. § 437c, subd. (f)(2).) A party may move for summary adjudication therefore “if it is contended that the action has no merit or that there is no defense to the action or proceeding.”  (Code Civ. Proc. § 437c, subd. (a).) “[I]f all the evidence submitted, and all inferences reasonably deducible from the evidence and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law,” the moving party will be entitled to summary judgment or adjudication on the individual issues.  (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.)

The moving party bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact, and if it does so, the burden shifts to the opposing party to make a prima facie showing of the existence of a triable issue of material fact.  (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850; accord Code Civ. Proc. § 437c, subd. (p)(2).)

Once the defendant has met that burden, the burden shifts to the plaintiff to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto.  (Aguilar, supra, 25 Cal.4th at 850.)  

Plaintiff Arnulfo’s complaint alleges Defendant ABLP, amongst others, breached its agreements with Magnolia Group in order to interfere with Magnolia Group's ability to pay back the loan from Defendant. Arnulfo further alleged that Defendant wrongfully foreclosed on the Douglas and Lewis properties. Arnulfo further alleged that Magnolia Group attempted to refinance the loan, but the process was interrupted when a deed of trust on the Douglas Property was recorded. Arnulfo asserted these causes of action collectively against all Defendants, including ABLP.

Defendant ABLP asserts this motion on the basis that Plaintiff Arnulfo lacks standing to bring any of the claims he asserts for breach of contract, wrongful foreclosure, intentional misrepresentation, breach of covenant of good faith and fair dealing, slander of title and intentional interference with prospective economic advantage. Plaintiff was not, at all relevant times, a party to the 2017 note or 2017 loan modification, was never an owner or trustor of the Douglas or Lewis Properties, was never an owner of the corporation or limited liability company.

Breach of Contract (First Cause of Action) and Breach of Covenant of Good Faith and Fair Dealing (Fifth Cause of Action)

The existence of a contract between the parties is an element of a breach of contract action. (See Coles v. Glaser (2016) 2 Cal.App.5th 384, 391.) Defendant ABLP argues this element is absent since Plaintiff is neither a named party, beneficiary or designated in any manner on the 2017 note or 2017 modification. (UMF Nos. 2, 3.)

The elements of a third party beneficiary breach of contract cause of action “determine not only (1) whether the third party would in fact benefit from the contract, but also (2) whether a motivating purpose of the contracting parties was to provide a benefit to the third party, and (3) whether permitting a third party to bring its own breach of contract action against a contracting party is consistent with the objectives of the contract and the reasonable expectations of the contracting parties." (Goonewardene v. ADP, LLC (2019) 6 Cal.5th 817, 830.) Here, the Court notes no evidence has been presented by Plaintiff that would indicate he is a third party beneficiary that would otherwise have standing to enforce the note and modification against Defendant on which he is not named expressly.

The Court, therefore, grants summary adjudication as to the first cause of action for breach of contract on issue 1.

As to the breach of the implied covenant, there must be an underlying contract for the covenant to exist:

“Every contract contains an implied covenant of good faith and fair dealing providing that no party to the contract will do anything that would deprive another party of the benefits of the contract…The scope of conduct prohibited by the implied covenant depends on the purposes and express terms of the contract. Although breach of the implied covenant often is pleaded as a separate count, a breach of the implied covenant is necessarily a breach of contract.”  Digerati Holdings, LLC v. Young Money Entertainment, LLC (2011) 194 Cal.App.4th 873, 885 (internal citations omitted).

For the same reasons as above, the Court grants the motion for summary adjudication as to the fifth cause of action for breach of implied covenant on issue 7.

Wrongful Foreclosure (Douglas and Lewis)

Sciarratta v. U.S. Bank National Assn. (2016) 247 Cal.App.4th 552, 561–562 described the cause of action for wrongful foreclosure:

“A wrongful foreclosure is a common law tort claim.  It is an equitable action to set aside a foreclosure sale, or an action for damages resulting from the sale, on the basis that the foreclosure was improper.  The elements of a wrongful foreclosure cause of action are:  ‘(1) The trustee or mortgagee caused an illegal, fraudulent, or willfully oppressive sale of real property pursuant to a power of sale in a mortgage or deed of trust; (2) the party attacking the sale (usually but not always the trustor or mortgagor) was prejudiced or harmed; and (3) in cases where the trustor or mortgagor challenges the sale, the trustor or mortgagor tendered the amount of the secured indebtedness or was excused from tendering.’ ” (Citations and alterations omitted.)

As noted by Defendant, maintenance of this cause of action requires that the plaintiff be the owner of the property, trustor under the deed of trust or a party to the loan agreement. Plaintiff here lacks such a status and thus cannot maintain these causes of action regarding the Douglas or Lewis Properties (UMF Nos. 6, 7, 13, 14.) Defendants have carried their burden on this motion. Plaintiff presents no evidence in opposition.

The Court grants the motion as to the wrongful foreclosure (second cause of action and third cause of action) as to issues 2 and 4. The Court finds issues 3 and 5 moot by way of ruling on 2 and 4 in favor of Defendant.

Fraud by Intentional Misrepresentation

Here, Defendant argues that because Plaintiff does not own the Douglas (UMF No. 20) or Lewis (UMF No. 21) Properties, or the Magnolia corporation (UMF No. 22)  or the associated Magnolia limited liability company (UMF No. 23), he cannot establish that any statements were made with the intent to deceive him, induce his justifiable reliance or result in damages to him. “A complaint for fraud must allege the following elements: (1) a knowingly false representation by the defendant; (2) an intent to deceive or induce reliance; (3) justifiable reliance by the plaintiff; and (4) resulting damages.” (Service by Medallion, Inc. v. Clorox Co. (1996) 44 Cal.App.4th 1807, 1816.) The Court agrees that a non-owner of property, corporation or LLC cannot be said to have been damaged by any statement regarding the property, corporation or LLC, have his reliance induced in any way or that such reliance would be justifiable. In short, Plaintiff was not the object of any alleged misrepresentations and thus cannot maintain this cause of action.

The Court grant summary adjudication as to fraud on issue 6.

Slander of Title

As noted by Defendant, actual title to the property is a requisite element of this cause of action. Defendant’s motion states “[i]n Broadway Fed., etc., Loan Assoc. v. Howard (1955) 133 Cal.App.2d 382,399, a demurrer to a claim for slander of title by the husband was sustained where the appellant's wife was alleged to be the owner of the property in question. The court noted the ‘pleading not only fails to allege the invasion of any legally protected interest in appellant, but inferentially even negatives such an implication .’ Id. at p. 401.” Here, the facts have established Plaintiff is not on title as owner or otherwise has an interest in the Douglas Property (UMF No. 29.)

The Court grant summary adjudication as to slander of title on issue 8.

Intentional Interference with Prospective Economic Relationship

Under Youst v. Longo (1987) 43 Cal.3d 64, 71, the elements of the tort of intentional interference with prospective economic relationship include the following: 

(a) An economic relationship between the plaintiff and some third party, with the probability of future economic benefit to the plaintiff. 

(b) The defendant's knowledge of the relationship. 

(c) Intentional acts by the defendant designed to disrupt the relationship. 

(d) Actual disruption of the relationship. 

(e) Economic harm to the plaintiff proximately caused by the acts of the defendant. 

(f) Conduct that was wrongful by some legal measure other than the fact of interference itself.  

Additionally, a claim for intentional interference with economic advantage is “made out when interference resulting in injury to another is wrongful by some measure beyond the fact of the interference itself.”  (Della Penna v. Toyota Motor Sales, U.S.A., Inc. (1995) 11 Cal. 4th 376, 385.) 

Here, Plaintiff’s is based on Magnolia corporation’s attempts to refinance the loans from Plaintiff in Fall of 2018. (UMF No. 30.) These loans were provided to Magnolia and not Plaintiff. As noted, Plaintiff was not a party or named beneficiary to the 2017 note or modification. (UMF Nos. 31, 32) As such, any disruption as to the refinance of the loans would fail to have any “probability of future economic benefit” to Plaintiff.

The Court grant summary adjudication as to intentional interference with prospective economic relationship on issue 9.

If no one requests oral argument, under Code of Civil Procedure section 1019.5(a) and California Rules of Court, rule 3.1312(a), no further written order is necessary. The minute order adopting this tentative ruling will become the order of the court and service by the clerk will constitute notice of the order. If anyone requests oral argument, the matter will be heard on June 7, 2022 at 8:30 AM in Dept. 7. 

Re:              Daglish, Hannah vs. Mainland Skate & Surf, INC

Case No.:    VCU281006

Date:            May 31, 2022

Time:            8:30 A.M. 

Dept.            7-The Honorable Bret D. Hillman

Motion:       Continued Motion for Preliminary Approval of Class Action and PAGA Settlement

Tentative Rulings: To grant the motion to preliminarily approve the settlement. The Final Approval Hearing is set for November 22,  2022 at 8:30am in Department 7.

Counsel, as directed, has filed supplemental declarations addressing the issues in the Court’s prior ruling.

1. Sufficiency of Amount of Settlement (Net Estimated: $457,000.00)

The gross settlement amount is $1,200,000.00. The Class Members consist of:

“All current and former hourly-paid, non-exempt employees of Defendant who worked in the State of California at any time from January 7, 2017 through August 31, 2021.”

Plaintiffs estimate approximately 1,250 proposed Class Members with an average payment of approximately $365.60 each. The individual PAGA payments to each member are, on average, expected to be $69.13.

Plaintiffs, by way of the proposed first amended complaint, bring claims for (1) failing to pay all overtime and (2) minimum wages, failing to provide compliant (3) meal and (4) rest periods and associated premium pay, failing to timely pay wages (5) during employment and (6) upon termination of employment, (7) failing to provide compliant wage statements, (8) failing to maintain requisite payroll records, and (9) failing to reimburse necessary business expenses, and (10) thereby engaged in unfair business practices in violation of California Business and Professions Code section 17200, et seq. and (11) conduct that gives rise to penalties pursuant to PAGA.

Plaintiffs provide estimates of the maximum recovery for each of the asserted wage and hour claims and penalties with information showing how the estimates were calculated including the damages models utilized. (Declaration of Burns ¶¶ 12 – 14.) The total estimated maximum recovery in the event of an outright victory is $10,980,358 including PAGA penalties. Plaintiffs have provided detailed discussion of the value of each claim, applied various discount rates regarding the chance of success as to each claim which correspond to the final gross settlement amount. Plaintiffs’ discussion includes evaluation of the various strengths and weaknesses of Plaintiffs’ case and Defendant’s defenses to Plaintiffs’ claims for each category above including the risk of being unsuccessful on the merits of each claim. This reduces the potential recovery to approximately $510,684. The proposed gross settlement amount of $1,200,000 is therefore more than double Plaintiff’s estimated recovery after discounting the risks and defenses.

Plaintiffs’ deductions from the gross settlement of $1,200,000 are proposed as follows:

Court Approved Attorney Fees (35%):                                                        $        420,000

Attorney Costs (up to):                                                                                          $        40,000

Enhancement Payment to Plaintiff – Daglish:                                         $        6,500

Enhancement Payment to Proposed Plaintiff – Hutchison:            $        6,500

Settlement Administrator Costs                                                                      $        20,000

PAGA payment to the LWDA                                                                             $        250,000

Net Settlement Amount                                                                    $        457,000

The Court finds the information provided sufficient to support the gross settlement amount

2.  Class Notice

The Court previously approved the notice period of 60 days and the contents of the Class Notice.

3.  Enhancement Awards to Class Representatives

The Court previously approved Plaintiffs Hannah Daglish and Proposed Plaintiff Jordyn Hutchison as the Class Representatives for settlement purposes, as well as their proposed enhancement awards of $6,500.

4. Attorneys’ Fees and Costs

Attorneys’ fees of 35% of the gross settlement fund of $1,200,000 or $420,000 and costs not to exceed $40,000 are sought by Plaintiff’s counsel.

The ultimate goal of the Court is to award reasonable attorneys’ fees irrespective of the method of calculation. As such, the court needs to know the estimate of the approximate lodestar supported by declarations for preliminary approval. Counsel has submitted information as to the time spent on this action and the hourly rates of all counsel working on the case. Here, counsel indicates that 452.20 hours have been expended on this matter. (Declaration of Burns ¶18.) The reasonable blended rate provided is $785. (Declaration of Burns ¶18.) This creates a lodestar figure of $354,977. (Declaration of Burns ¶18.) Therefore, counsel’s request for preliminary approval would require a multiplier of 1.18. The Court preliminarily approves the fees.

Counsel has also provided the current costs expended in an amount of $15,839.59. (Declaration of Burns ¶21.) The Court preliminarily approves costs not to exceed $40,000.00.

The Court previously found that Plaintiffs’ counsel are experienced class action attorneys through the declarations of counsel.

5.  Claims Administrator

The court previously approved Simpluris, Inc. as the claims administrator for this class action based on prior experience. Having now been provided a declaration, the Court preliminarily approves administration costs not to exceed $13,100 based upon the Declaration of Springer and the attached itemized estimate.

6. Unclaimed Settlement Proceeds

The Court has already approved the distribution of unclaimed settlement proceeds to California Controller’s Office Unclaimed Property Division.

7. Release

The Court previously found the proposed release of claims reasonable under the circumstances.

8. LWDA Notice

The Court notes that the proof of service filed March 10, 2022 indicates submission of the settlement to the LWDA via their online submission system in conformance with Labor Code section 2699(1).

9. Class Certification

The Court previously preliminarily certified the class for settlement purposes.

10. Filing a First Amended Complaint

The Court previously granted leave to file the First Amended Complaint.

Accordingly, the Motion is granted and the class action and PAGA settlement is preliminarily approved. The Final Approval Hearing is set for November 22, 2022 at 8:30am in Department 7.

If no one requests oral argument, under Code of Civil Procedure section 1019.5(a) and California Rules of Court, rule 3.1312(a), no further written order is necessary. The minute order adopting this tentative ruling will become the order of the court and service by the clerk will constitute notice of the order. If anyone requests oral argument, the matter will be heard on June 7, 2022 at 8:30 AM in Dept. 7. 

Re:              Aqra, Somia vs. Burton Elementary School District et al

Case No.:   PCU277093

Date:            May 31, 2022

Time:            8:30 A.M. 

Dept.            23-The Honorable Gary M. Johnson

Motion:      Plaintiff’s Counsel’s Motion to Withdraw

Tentative Ruling: To grant the motion.

Facts

On May 6, 2022, Plaintiff’s Counsel Anastasi Mazzella, Kabateck LLP, filed a motion to be relieved as counsel as to Plaintiff Somia Aqra, by and through her guardian ad litem Karen Aqra. Plaintiff’s Counsel filed the following with respect to withdrawing:

(1) MC-051 - Notice of Motion and Motion to be Relieved as Counsel;

(2) MC-052 – Declaration in Support of Attorney's Motion to Be Relieved as Counsel; and

(3) MC-053 - Order Granting Attorney's Motion to Be Relieved as Counsel

Additionally, Plaintiff’s Counsel has filed proofs of service of these documents to Plaintiff by mail as well as to counsel by email.

Authority and Analysis

CCP §284 provides that “[t]he attorney in an action or special proceeding may be changed at any time before or after judgment of final determination, as follows:
1. Upon the consent of both client and attorney, filed with the clerk, or entered upon the minutes; [or] 2. Upon the order of the court, upon the application of either client or attorney, after notice from one to the other.”

California Rule of Court 3.1362(a) requires that the “notice of motion and motion to be relieved as counsel under Code of Civil Procedure section 284(2) must be directed to the client and must be made on the Notice of Motion and Motion to Be Relieved as Counsel-Civil (form MC-051).”

As noted above, Attorney Mazzella has complied with California Rule of Court 3.1362(a) by submitting the notice and motion on MC-051 and by directing the notice and motion to Plaintiff.

California Rule of Court 3.1362 (c) further mandates that: “The motion to be relieved as counsel must be accompanied by a declaration on the Declaration in Support of Attorney's Motion to Be Relieved as Counsel--Civil (form MC-052). The declaration must state in general terms and without compromising the confidentiality of the attorney-client relationship why a motion under Code of Civil Procedure section 284(2) is brought instead of filing a consent under Code of Civil Procedure section 284(1). Specifically, the declaration that Rule 3.1362(c) requires must state that the moving attorney attempted to secure a “Substitution of Attorney” from the client as required under CCP §284(1) and that the client refused to so stipulate.

Here, the declaration is properly made on form MC-052 and uses general terms without compromising confidentiality and indicates that Counsel has attempted to obtain a substitution by stipulation, but that Plaintiff refused. 

Next, service under Rule 3.1362(d) requires personal service, electronic service, or mail and counsel’s declaration must note the service made. Here, service was by mail on February 10, 2022. The declaration of Mazzella indicates that Plaintiff’s address was confirmed as current.

Finally, Rule 3.1362(e) requires the proposed order be lodged with the Court on MC-053 with the moving papers, specifying all hearing dates scheduled, including date of trial. Plaintiff’s Counsel has complied with this requirement.

Therefore, the Court grants Plaintiff’s Counsel’s Motion to Withdraw as to Plaintiff Aqra. If no one requests oral argument, the Court is prepared to sign the order entitled “Order Granting Attorney’s Motion to be Relieved as Counsel - Civil” that the moving party lodged with the Court.  This order will be deemed effective upon the filing with the court of a proof of personal service of the “Order Granting Attorney’s Motion to be Relieved as Counsel – Civil” as to Plaintiff Aqra.

The Court further directs Attorney Mazzella to attach to the Order an additional notice of the date, time, and Department of this court for any future hearing dates for this case as calendared.

If no one requests oral argument, under Code of Civil Procedure section 1019.5(a) and California Rules of Court, rule 3.1312(a), no further written order is necessary. The minute order adopting this tentative ruling will become the order of the court and service by the clerk will constitute notice of the order.

Examiner Notes for Probate Matters Calendared

• Visalia Division 
• South County Justice Center Division