Motion Summary Judgment Adjudication

Cal. Super. - 6th Dist.July 31, 2015

SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER R. Placone vs Dixon Development Company, Llc, et al Hearing start Time: 9:00 AM Hearing Type: Motion: Summary 2015 1 CV 283832 Judgment/Adjudication Date of Hearing: 08/21/2018 Comments: Heard By: Zayner, Theodore C Location: Department 6 Courtroom Reporter: - No Court Reporter Courtroom Clerk: Maggie Castellon Court Interpreter: Court Investigator: Parties Present: Future Hearings: Exhibits: - Tentative ruling not contested. Tentative ruling is adopted as follows; Sagorac s Motion 1. Scope and Nature of the Motion As a preliminary matter, it is necessary to clarify the scope and nature of the instant motion before addressing the merits thereof because it is unclear from Sagorac s presentation of the motion whether Sagorac is moving for summaryjudgment of the cross-complaint or summary adjudication of specific causes of action alleged therein. In his notice of motion, Sagorac states that he is moving for summaryjudgment as the Cross-Complaint herein filed on March 22, 2017 for the causes of action for breach of contract and equitable indemnification; and summary adjudication of his cause of action for conversion. (Sic.) (Ntc. Mtn., p. 125-8.) He further states that the motion is made on the grounds that there is no triable issue of material fact as to the claims for breach of contract, conversion, and equitable indemnification. (Id. at p. 1:9-22.) Next, in his memorandum of points and authorities, Sagorac states that his breach of contract claim is ripe for summaryjudgment ; his conversion claim is ripe for summary adjudication; and he should be granted summary judgement [sic] as to his equitable indemnification claim. (Mem. Ps. & As., pp. 6:22-16.) Additionally, Sagorac s separate statement of undisputed material facts only addresses the first cause of action for breach of contract, the seventh cause of action for conversion, and the tenth cause of action for indemnity. In his papers, Sagorac does not present any argument with respect to claims alleged in his cross-complaint other than those for breach of contract, conversion, and indemnity. Given that Sagorac s motion is not directed at the cross-complaint in its entirety and, instead, only addresses the claims for breach of contract, conversion, and indemnity, the Court construes the instant motion as solely one for summary adjudication of the first cause of action for breach of contract, the seventh cause of action for conversion, and the tenth cause of action for indemnity. (See Code Civ. Proc., 437c, subd. (a) [A motion Printed: 8/22/2018 08/21/2018 Motion: Summary Iudgment/Adjudication - 2015-1-CV- Page 1 offi 283832 SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER for summary judgment must dispose of the entire action].) 2. Request for Judicial Notice In connection with his opposition, Moltyaner asks the Court to take judicial notice of all prior exhibits previously filed in [his] Motion for Summary Judgment Or in the Alternative, Summary Adjudication of Issues on the Cross-Complaint filed by James M. Sagorac, Jr. filed with this Court on May 23, 2018. (RJN, p. 225-8.) The subject court records are generally proper subjects ofjudicial notice under Evidence Code section 452, subdivision (d). Evidence Code section 452, subdivision (d) states that the court may take judicial notice of [r]ecords of any court of this state. That provision permits the trial court to take judicial notice of the existence ofjudicial opinions and court documents, along with the truth of the results reached in the documents such as orders, statements of decision, and judgments but [the court] cannot take judicial notice of the truth of hearsay statements in decisions or court files, including pleadings, affidavits, testimony, or statements of fact. (People v. Woodell (1998) 17 Cal.4th 448, 455 (Woodell).) Consequently, Court will only take judicial notice of the existence of the subject documents and the truth of the results reached in any court order. The Court will not take judicial notice of the truth of hearsay statements in those documents. Accordingly, Moltyaner s request for judicial notice is GRANTED as to the existence of the subject documents and the truth of the results reached in any court order. 3. First Cause of Action |n the first cause of action for breach of contract, Sagorac alleges that he entered into an agreement with Moltyaner to make sure Plaintiffs were repaid ; Moltyaner failed to perform his/its/their obligations and responsibilities under the agreements we had; [d]uring all times pertinent herein, [he] performed all of [his] obligations by developing the Property for [Moltyaner] to take over the next phase as part of [their] partnership ; and [a]s a direct and proximate result of the breach of contracts by [Moltyaner], Plaintiffs and [he] have suffered damages to be proved at trial. (Cross-Complaint, 16-19.) Notably, in the general allegations of the cross-complaint, Sagorac specifically alleges that his agreement with Moltyaner regarding repayment to Placone was a written agreement attached as an exhibit to Plaintiffs Complaint. (Id. at 8-9.) Sagorac argues that he is entitled to summary adjudication of the first cause of action because Moltyaner entered into a contract with him providing that Moltyaner would pay him the remaining profit from the project on the Property and his invested funds and Moltyaner failed to pay him those monies. (Mem. Ps. & As., pp. 7225-11-13.) As Moltyaner persuasively argues, Sagorac s argument on summary adjudication is improper because it goes beyond the scope of the issues raised in the first cause of action. As previously stated, the pleadings limit the issues presented for summary adjudication and such a motion may not be granted or denied based on issues not raised by the pleadings. (See Government, supra, 79 Cal.App.4th at p. 98; Laabs, supra, 163 Cal.App.4th at p. 1258; Nieto, supra, 181 Cal.App.4th at p. 73.) As currently pleaded, the first cause of action for breach of contract is predicated upon and only alleges the existence of a contract between Moltyaner and Sagorac to Printed: 8/22/20 1 8 08/21/201 8 Motion: Summary Iudgmenl/Adjudication - 2015-1-CV- Page 2 of 6 283832 SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER make sure Plaintiffs were repaid. (Cross-Complaint, 8-9, 11, 13, 16.) The claim, as pleaded, does not allege that the parties had a contract whereby Moltyaner was to pay Sagorac remaining profit from the project on the Property and Sagorac s invested funds. Consequently, Sagorac s arguments regarding the existence and breach of such an agreement are not a basis on which the motion for summary adjudication may be granted. Accordingly, Sagorac s motion for summary adjudication of the first cause of action for breach of contract is DEN | ED. 4. Seventh Cause of Action In the seventh cause of action for conversion, Sagorac alleges that [p]ursuant to the terms and conditions of the above-alleged agreements, repayment of all creditors, especially Plaintiffs, was to be completed and made upon the completion ofthe project at the Property. (Cross-Complaint, 50.) Moltyaner allegedly completed the project at the Proerty [sic] and kept all of the money and did not pay Plaintiffs or [Sagorac] as [he] agreed and [was] otherwise obligatied [sic] to do and in so doing, deprived Plaintiffs and [Sagorac] from possession of the funds and converting said monies for [him] use. (Id. at 51.) Sagorac alleges that [a]s a direct and proximate result of [Moltyaner s] conversion of the monies representing the repayment of the principal and all unpaid and accrued interest under the loan agreements with Plaintiffs, Plaintiffs have suffered damages to be proved at trial. (Id. at 52.) Sagorac argues that he is entitled to summary adjudication of the seventh cause of action because Moltyaner failed to pay him monies due and owing to him under an agreement and Moltyaner took those monies and used them for his exclusive advantage. (Mem. Ps. & As., pp. 6:24-28.) Specifically, Sagorac contends that Moltyaner used the monies due [to him] from the Dixon Project for his own purposes thereafter, making a profit in excess of the specific amount due [to him] plus pre-judgment interest thereon. (Id. at p. 12:12-14.) Sagorac also states that [he] is not advised of the amount of monies earned by [Moltyaner] on the monies that are due to him. (Id. at pp. 6:28-7:1.) Sagorac states that he is reserving for trial or other proceeding the establishment of the full amount of damages due [to him]. (Id. at pp. 7:4-6 and 12:18-20.) Nonetheless, Sagorac contends that the claim is ripe for summary adjudication. As Moltyaner persuasively argues, Sagorac is not entitled to summary adjudication of the seventh cause of action because he has not established that there is no triable issue of material fact regarding the amount of damages. Summary adjudication is inappropriate where issues of the calculation of damages remain to be determined (See Dept. of Indus. Relations v. UI Video Stores, Inc. (1997) 55 Cal.App.4th 1084, 1097; see also Paramount, supra, 227 Cal.App.4th at p. 241.) A plaintiff must prove each element of the cause of action entitling the party to judgment on that cause of action. (See Paramount, supra, 227 Cal.App.4th at p. 241 [as damages are an element of a breach of contract cause of action, a plaintiff cannot obtain judgment on a breach of contract cause of action in an amount of damages to be determined later].) The elements of conversion are the plaintiff s ownership or right to possession of the property at the time of the conversion; the defendant s conversion by a wrongful act or disposition of property rights; and damages. (Oakland Village Group v. Fong (1996) 43 Cal.App.4th 539, 543-44.) As damages are an element of a conversion claim and Sagorac indicates that the calculation of the total amount of damages allegedly sustained by him remains to be determined, summary adjudication of the seventh cause of action is inappropriate. Accordingly, Sagorac s motion for summary adjudication of the seventh cause of action for conversion is Printed: 8/22/20 1 8 08/21/201 8 Motion: Summary Iudgment/Adjudication - 2015-1-CV- Page 3 of 6 283832 SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER DENIED. 5. Tenth Cause of Action In the tenth cause of action for indemnity, Sagorac alleges that Placone s first amended complaint alleges, among other things, conduct entitling [Placone] to damages against [him] ; [he] contends that [he] is not liable for the events and occurrences described in Placone s pleading; [Moltyaner] is responsible, in whole or in part, for the damages, if any suffered by [Placone] ; if he is judged liable to plaintiffs, [Moltyaner] should be required to pay Plaintiffs judgment for causing Plaintiffs' damages and to reimburse [him] for any payment [he] make to Plaintiffs; and [a]s a direct and proximate result of the above, [he] has been damaged by reason of investigation, expenses, attorneys fees, and costs that have been, and will be, incurred, in a sum not currently known. (Cross-Complaint, 65-69.) Sagorac argues that he is entitled to summary adjudication of the tenth cause of action because Moltyaner was his successor in the Dixon Project and assumed the obligations under the [Placone] loans to the Dixon Project. (Mem. Ps. & As., pp. 12228-1322) Sagorac states that Moltyaner purchased his interest in the Dixon project and Moltyaner s purchase of the Dixon project venture was a mere continuation of [his] Dixon Project venture. (Id. at p.13z7-10.) |n support of his successor liability argument, Sagorac cites Ray v. Alad Corp. (1977) 19 Cal.3d 22 (Ray). Sagorac contends that his settlement agreement with Placone obligates [him] to defray [Moltyaner s] obligation to pay the [Placone] loan obligations and, therefore, [he] is entitled to be equitably indemnified for being put in a position to make good on [Moltyaner s] obligation to [Placone s] loans to the Dixon Project. (Id. at p. 13:2-6.) Indemnity refers to the obligation resting on one party to make good a loss or damage another party has incurred. (Jocer Enterprises, Inc. v. Price (2010) 183 Cal.App.4th 559, 573 (Jocer), internal citations and quotation marks omitted.) There are two types of indemnity: express and equitable. (|bid.) Express indemnity relies on an express contract providing for indemnification, whereas equitable indemnification requires no contractual relationship between the parties. (|bid.) The purpose of equitable indemnification is to avoid the unfairness, under joint and several liability theory, of holding one defendant liable for the plaintiff's entire loss while allowing another responsible defendant to escape scot free. (Platt v. Coldwell Banker Residential Real Estate Services (1990) 217 Cal.App.3d 1439, 1444 (Platt), internal citations and quotation marks omitted.) An action for equitable indemnity is premised on a joint legal obligation to the plaintiff; thus, if the court determines a defendant or cross-defendant is not liable for the injuries, another defendant may not properly pursue an indemnity claim against that defendant. (Children s Hospital v. Sedgwick (1996) 45 Cal.App.4th 1780, 1787 (Sedgwick).) |n other words, an essential element of an indemnity claim is common liability. (|bid.; Major Clients Agency v. Diemer (1998) 67 Cal.App.4th 1116, 1131 (Major) [The basis for an action for equitable indemnity is a joint legal obligation to another for damages. As we previously stated, there can be no indemnity without liability , meaning that if the record does not establish that a defendant is a concurrent tortfeasor responsible in some measure for the injuries suffered by the plaintiff, that defendant is not subject to a claim for indemnity by another defendant. ], internal citations omitted.) Here, as Moltyaner persuasively argues, Sagorac fails to meet his initial burden to show that Moltyaner had a joint legal obligation to Placone to repay the subject loans. As articulated above, Sagorac contends that he and Moltyaner had a joint legal obligation to repay the subject loans because Moltyaner is his successor and Moltyaner s purchase of the Dixon project venture was a mere continuation of [his] Dixon Project venture. (Mem. Ps. & As., p.13:7-10.) The only legal authority cited in support of Sagorac s contention is Ray. Printed: 8/22/20 1 8 08/21/201 8 Motion: Summary Iudgment/Adjudication - 2015-1-CV- Page 4 of 6 283832 SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER Ray involved one corporation purchasing the principal assets of another corporation. (Ray, supra, 19 Cal.3d at pp. 26 and 28.) In that case, the California Supreme Court opined that under California law a purchaser does not assume the seller s liabilities unless (1) there is an express or implied agreement of assumption, (2) the transaction amounts to a consolidation or merger of the two corporations, (3) the purchasing corporation is a mere continuation of the seller, or (4) the transfer of assets to the purchaser is for the fraudulent purpose of escaping liability for the seller s debts. (Id. at p. 28.) |t further opined that California decisions holding that a corporation acquiring the assets of another corporation is the latter s mere continuation and therefore liable for its debts have imposed such liability only upon a showing of one or both of the following factual elements: (1) no adequate consideration was given for the predecessor corporation s assets and made available for meeting the claims of its unsecured creditors; (2) one or more persons were officers, directors, or stockholders of both corporations. (Id. at p. 29.) This case is readily distinguishable from Ray. First, this case is not one involving a corporation purchasing the principal assets of another corporation. Sagorac does not provide any reasoned argument or legal authority indicating that the principles articulated in Ray apply to individuals as opposed to corporations. (See Badie v. Bank of America (1998) 67 Cal.App.4th 779, 784-85 (Badie); see also Schaeffer Land Trust v. San Jose City Council (1989) 215 Cal.App.3d 612, 619, fn. 2 (Schaeffer) [ [A] point which is merely suggested by a party s counsel, with no supporting argument or authority, is deemed to be without foundation and requires no discussion. ].) Second, Sagorac does not present any argument or evidence showing that: (1) no adequate consideration was given for the purchased assets and made available for meeting the creditor claims; or (2) one or more persons were officers, directors, or stockholders of both the predecessor and successor entity. Consequently, Sagorac fails to demonstrate that Moltyaner s alleged business was a mere continuation of his business such that Moltyaner had a joint legal obligation to repay Placone s loans. Accordingly, Sagorac s motion for summary adjudication of the tenth cause of action for indemnity is DEN | ED. - ooOoo - PREVAILING PARTY SHALL PREPARE THE ORDER (SEE RULE 0F COURT 3.1312 PROPOSED ORDER MUST BE E-FILED BY COUNSELAND SUBMITrED PER 3.1312(0) Printed: 8/22/20 1 8 08/21/201 8 Motion: Summary Iudgment/Adjudication - 2015-1-CV- Page 5 of 6 283832 SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA MINUTE ORDER Printed: 8/22/20 1 8 08/21/201 8 Motion: Summary Iudgment/Adjudication - 2015-1-CV- Page 6 of 6 283832