Reply To OppositionReplyCal. Super. - 4th Dist.July 12, 2017© 0 9 O N nn kA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo MICHAEL E. GALLAGHER, ESQ. (SBN 195592) mgallagher@behblaw.com EARL L. HAGSTROM, ESQ. (SBN 150958) ehagstrom@behblaw.com ERIN K. POPPLER, ESQ. (SBN 267724) epoppler@behblaw.com DANIEL E. TROWBRIDGE, ESQ. (SBN 301301) dtrowbridge@behblaw.com BASSI, EDLIN, HUIE & BLUM LLP 500 Washington Street, Suite 700 San Francisco, CA 94111 Telephone: (415) 397-9006 Facsimile: (415) 397-1339 Attorneys for Defendant C.E. ALLEN COMPANY, INC., D/B/A ALLENCO SUPERIOR COURT OF THE STATE OF CALIFORNIA IN AND FOR THE COUNTY OF ORANGE SA ATHNASSIA, LLC, A CALIFORNIA LIMITED LIABILITY COMPANY, et al. , Plaintiffs, VS. C.E. ALLEN COMPANY, INC.. d/b/a ALLENCO, Defendants. N r N r N r N r N a N r a a a a a a C.E. ALLEN COMPANY, INC. d/b/a ALLENCO, Cross-Complainants Vs. PIECO, INC., a Nevada Corporation; and SA ATHNASSIA, LLC Cross-Defendants - N r N r N r a N r a a a Case No. 30-2017-00931311-CU-BC-CJ REPLY IN SUPPORT OF DEFENDANT C.E. ALLEN COMPANY, INC’S MOTION FOR SUMMARY ADJUDICATION Judge: Hon. Thomas Delaney Date: January 10, 2020 Time: 10:00 a.m. Dep’t: C24 Reservation No.: 73104430 Trial Date: December 2, 2019 Complaint Filed: August 17.2017 Oo 0 9 O N wn BA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo I. INTRODUCTION Plaintiff SA ATHNASSIA LLC’s (“Athnassia”) Opposition fails to dispute any material fact. First, Athnassia’s total failure to submit a statement of disputed material facts which complies with code of Civil Procedure section 437c(b)(3) and California Rules of Court 3.1350(f) is fatal to its Opposition. AllenCo’s Motion should be granted on this basis alone. See CODE OF C1v. PROC. § 437¢(b)(3); CAL. RULES OF COURT 3.1350(f); Lewis v. County of Sacramento, 93 Ca.4th 107, 115, 113 (2001) (emphasis added). Second, Athnassia fails to carry its burden to produce substantial admissible and competent evidence demonstrating the existence of a triable issue of material fact. While Athnassia attempts to introduce a plethora of inadmissible evidence and speculation, it fails to dispute the key material facts. Namely, following the Second Agreement with C.E. ALLEN COMPANY, INC. (“AllenCo”), Athnassia entered into an accord and satisfaction which released any contractual claims that may have existed at the time of the agreement. Third, even if Athnassia’s evidence were considered, it does not create a triable issue of fact about whether there was an accord and satisfaction and waiver of the breach claims currently at issue when a settlement was reached between Athnassia and AllenCo. All of the purported evidence Athnassia offers relates to what it subjectively intended when it entered the settlement with AllenCo. Athanssia’s subjective intent is irrelevant. Contract formation is governed by objective manifestations and what a reasonable person would have been lead to believe. Roth v. Malson, 67 Cal.App.4th 552, 557 (1998). The undisputed evidence establishes an accord and satisfaction, and waiver of Athnassia’s breach claim occurred when it made a final payment to AllenCo related to its work on Well #20. Athnassia’s “throw everything against the wall” strategy does not establish the existence of any valid disputed material fact. As Athnassia has failed to dispute any material fact ! Disapproved on other grounds in Kaufman & Broad Communities, Inc. v. Performance Plastering, Inc., 133 Cal.4th 26, 41-42 (2005) © 0 9 O N nn kA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo demonstrating the accord and satisfaction did not constitute a release or waiver of any breach claims, AllenCo respectfully request the Court grant its motion in its entirety. II. ARGUMENT A. ATHNASSIA FAILS TO DEMONSTRATE THE EXISTENCE OF A TRIABLE ISSUE OF MATERIAL FACT WITH COMPETENT EVIDENCE 1. Athnassia Does Not Properly Dispute Material Facts In responding to a moving party’s separate statement of undisputed material facts, the opposing party's separate statement must state unequivocally whether each fact in the moving party's separate statement is “disputed” or “undisputed.” See CODE OF Civ. PROC. § 437¢c(b)(3); CAL. RULES OF COURT 3.1350(f). The opposing party must respond to each material fact, and identify any other material facts the opposing party contends are disputed. Each material fact must be followed by a reference to supporting evidence. See CODE OF Civ. PROC. § 437¢c(b)(3); CAL. RULES OF COURT 3.1350(f). “Without a separate statement of undisputed facts with references to supporting evidence...it is impossible...to demonstrate the existence of disputed facts.” Lewis, 93 Ca.4th at 115, 113. When a moving party makes the required prima facie 2 6 showing, the opposing party’s “[f]ailure to comply with this requirement may, in the court's discretion, constitute a sufficient ground for granting the motion.” CODE OF CIV. PROC. § 437c(b)(1); See Oldcastle Precast, Inc. v. Lumberman’s Mutual Casualty Co., 170 Cal. App.4th 554, 568 (2009). “The requirement of a separate statement from the moving party and a responding statement from the party opposing summary judgment serves two functions: to give the parties notice of the material facts at issue in the motion and to permit the trial court to focus on whether those facts are truly undisputed.” Old Castle Precast, Inc., 170 Cal. App.4th at 569 (internal citations omitted). Here, AllenCo submitted a separate statement of undisputed material facts, which included twenty-three separate entries. See AllenCo’s Separate Statement of Undisputed Material Facts (“UMF”). Along with its Opposition, Athnassia submitted a “Separate Statement of Disputed Material Facts in Opposition,” (“SSDMF”’) including only five allegedly disputed © 0 9 O N nn kA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo facts which neither correspond to nor dispute the facts asserted by AllenCo, clearly failing to comply with the requirements of CCP section 437c and CRC 3.1350(f). The “disputed facts” identified by Athnassia do not respond to AllenCo’s UMF, and do not demonstrate the existence of triable issue of material facts as to Athnassia’s waiver and release of its breach of contract claim. As AllenCo has made a prima facie showing in its initial moving papers, Athnassia’s failure to submit a responsive separate statement renders it impossible to establish disputed material facts. On this basis alone, AllenCo’s motion should be granted. a. Athnassia Offers no Competent Evidence to Dispute the Existence of the Accord and Satisfaction Athnassia offers no competent evidence to dispute the existence of an accord and satisfaction, or the release contained therein. A party against whom a motion is directed must produce evidence demonstrating some “triable issue” of material fact. CODE OF C1v. PROC. § 437c(b)(3). “An issue of fact is not created by speculation, conjecture, imagination, or guesswork, it can be created only by a conflict in the evidence submitted to the trial court....” Lewis, 93 Cal.App.4th at 116-117. To establish a triable issue of material fact, the party opposing the motion must produce substantial responsive evidence.” Sangster v. Paetkau, 68 Ca.4th 151, 166 (1998). An opposition that contains no evidence, but simply asserts a triable issue exists on the issues involved, is insufficient. Shepherd v. Jones, 136 Ca.3d 1049, 1062 (1982). Unless controverted, a moving party’s declaration must ordinarily be accepted as true on a motion for summary judgment or adjudication. Trujllo v. First American Registry, Inc., 157 Ca.4th 628, 632 (2007) disapproved on other grounds by Connor v. First Student, Inc., 5 Cal.5th 1026, 1038 (2018). Further, the evidence must be admissible. See Overland Plumbing v. Transamerica Ins. Co.,119 Ca.3rd 476, 483 (1981) (“only admissible evidence in opposing declarations liberally construed in deciding whether there is a triable issue”). Here, Athnassia fails to offer any competent and admissible evidence to dispute any material fact asserted in AllenCo’s moving papers. Athnassia’s Opposition acknowledges the existence of an “accord and satisfaction.” Opposition, p. 5:11-18. Athnassia acknowledges that following negotiation of the outstanding obligations under the Second Agreement, it tendered © 0 9 O N nn kA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo “final payment” pursuant to the agreement. While Athnassia attempts to confuse the issues by including a number of irrelevant, speculative and inadmissible assertions, it does not dispute it entered into the Final Settlement (See UMF 22-23, Exh. 11 to AllenCo’s Compendium) which included the statement that “Per your offer of $47,000.00 AllenCo has agreed To accept ‘forty seven thousand US Dollars, to Settle any and all difference between Allenco and Well #20 [sic].” Opposition, p. 4:8-11; 5:12-15. b. Contract Formation is Governed by Objective Manifestations, not Subjective Intent of Any Individual Involved “Contract formation is governed by objective manifestations, not subjective intent of any individual involved. The test is ‘what the outward manifestations of consent would lead a reasonable person to believe.” Roth, 67 Cal.App.4th at 557. “Whether a contract is sufficiently definite to be enforceable is a question of law for the Court.” Ladas v. California State Automobile Assn., 19 Cal.App.4th 761, 770 (1993). Interpretation of a contract consists of ascertaining the meaning to be given to the expression of the parties. See CAL Civ. CODE § 1635; et seq. Where the language of a contract is clear and not absurd, it will be followed. CAL Civ. CoDE § 1638. When a contract is reduced to writing, the parties’ intention is ascertained from the writing alone, if possible. CAL Civ. CODE § 1638. It is undisputed the Parties entered into the Final Settlement, and that the Final Settlement constitutes a valid contract. It is undisputed that each party agreed to give up something of value. UMF 920-22. Athnassia acknowledges in its Opposition that it was concerned AllenCo would file a mechanic’s lien due to Athnassia’s admitted failure to comply with the terms of the Second Agreement. See Athnassia’s Separate Statement of Disputed Material Facts (“SSDMEF”) p. 3:6-11. AllenCo agreed to forego $50,297.33, which it was owed under the Agreements, to settle all differences between the Parties; including AllenCo’s right to pursue Athnassia for breach of contract for its failure to pay the amount due upon Athnassia’s decision to discontinue the abandonment. UMF 9 20-22. By the plain language of the Final Settlement Athnassia likewise forewent any claims which may have existed under the Agreements. 1d. If the agreement to settle any and all differences between the Parties did not include Athnassia’s Oo 0 9 O N wn BA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo release of any obligations it contends it was owed under the previous agreement, Athnassia would not have been giving up anything in exchange for AllenCo’s substantial consideration. Plainly, the Final Settlement between the Parties to settle any and all differences between themselves included allegations of breach of the Agreements by either Party. It is undisputed that all of Plaintift’s breach of contract claims pertain to AllenCo’s work on Plaintiff’s well, well #20. SSDMF q 1-2. The straightforward language of the Final Settlement makes clear there is no other reasonable interpretation of the Final Settlement. While Athnassia simply asserts there were no settlement discussions, it goes on to describe the settlement discussions that occurred. It asserts that following AllenCo’s attempts to collect the amounts due under the Second Agreement,> Emad Bolous and Makram Youseff set up a meeting to discuss settlement of the AllenCo’s potential claim. See Declaration of Makram Youssef (“Yousef Declaration”) qq 8-10, 13-14. Simply stating Mr. Youssef and Mr. Bolous did not intend to release AllenCo does not constitute competent evidence disputing the plain language of the release, wherein Athnassia agreed to pay less than half of the amount due under the Second Agreement to settle all differences between the parties related to well 20, the subject of both the First and Second Agreements. Athnassia offers no competent evidence to explain what other “differences” could have been the subject of the Final Settlement. Nothing in Athnassia’s opposition papers constitutes competent evidence which could demonstrate an “objective manifestation” of its intention not to settle “any and all differences” related to the well as the Final Settlement clearly provides. C. ATHNASSIA MISSTATES THE STANDARD FOR WAIVER In evaluating a waiver claim, there must be an existing right, a knowledge of its existence, an actual intention to relinquish it, or conduct so inconsistent with the intent to enforce the right as to induce a reasonable belief that it has been relinquished.” DuBeck v. California Physician’s Service, 234 Cal. App.4th 1254, 1265 (2015) (emphasis added). 2 Plaintiff does not assert any breach under the Second Agreement, or provide any explanation for why it was not obligated to pay the amount due. Oo 0 9 O N wn BA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo Even if Athnassia did not intend to waive any claim under the Agreements, Athnassia’s conduct was sufficient to induce a reasonable belief it relinquished its contract claims against AllenCo. An objective interpretation of the Final Settlement, the existence of which is not refuted by Athnassia, demonstrates the release was intended to include all differences pertaining to AllenCo’s work on well 20, the only work for which AllenCo was ever hired to perform for Plaintiff. UMF 922-23. As demonstrated below, Athnassia was undisputedly aware of its allege breach of contract claim when it entered into the Final Settlement. Given the Final Settlement involved a discount of more than 50% of the total contract amount on AllenCo’s behalf, there is no other reasonable interpretation of the Final Settlement. B. ATHNASSIA ACKNOWLEDGES IT WAS AWARE OF THE ALLEGED “BREACH” AT THE TIME IT ENTERED INTO THE SECOND AGREEMENT, AND THE ACCORD AND SATISFACTION Even if, arguendo, Athnassia’s “disputed facts” are considered, Athnassia only disputes the nature of the alleged breach, and fails to dispute the key facts relevant to AllenCo’s argument that Athnassia waived any such breach when it entered into the Second Agreement, or the subsequent accord and satisfaction. See SSDMF qq 1-2. Athnassia does not dispute the key allegations, that at the time Athnassia entered into the Second Agreement with AllenCo, it was aware of the alleged breach. UMF qq 11-13. Based on Athnassia’s own assertion, AllenCo’s alleged breach is limited to its failure to comply with the DOGGR permit; and it is undisputed Athnassia was aware of this alleged breach months before it entered into the Second Agreement. See SSDMF 1 1-2. At the time Athnassia entered into the Second Agreement, the “Notice of Violation” had been issued, Athnassia, including Mr. Bolous himself, participated in a meeting with DOGGR regarding the alleged failure to comply with the permit, and that following that meeting, and prior to entering into the Second Agreement, Athnassia received a letter from DOGGR advising it would not rescind or amend the Notice of Violation, leading to the Second Agreement. See UMF q 11; Bolous Declaration 99 15-16; See Exhibit 5 to Athnassia’s Compendium of Evidence © 0 9 O N nn kA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo (“Athnassia’s Compendium”). While Athnassia alleges it was not aware of the decision to cement the well at a lesser depth than required to comply with the DOGGR permit prior to alleged cement pouring occurring, it is absolutely undisputed that Athnassia was aware of this alleged breach at the time it entered into the Second Agreement, and the subsequent accord and satisfaction. See UMF q 11; See also Bolous Declaration 4 15-16.; See also Exhibit 5 to Athnassia’s Compendium. Accordingly, Athnassia’s argument that it could not have intended to release its breach claims when it paid the final settlement to AllenCo because these claims were unknown to Athnassia at that time, is belied by the undisputed facts. See Opp at 4:15-22. C. ATHNASSIA DID NOT DISPUTE IT OPTED TO “DISCONTINUE THE ABANDONMENT” WITH ALLENCO Athnassia does dispute its representative, Mr. Bolous, testified that Athnassia fired AllenCo following the Second Agreement, and upon presentation of a third proposal. While he seeks to clarify, “we simply decided not to rehire them for a third attempt,” it is undisputed that Athnassia chose to discontinue the re-abandonment with AllenCo. UMF 9 16-17; See Also Bolous Declaration § 45. When Athnassia opted to discontinue the abandonment with AllenCo, AllenCo was no longer subject to any further obligation to perform pursuant to the Agreements. UMF 9 16-17. D. PLAINTIFF DID NOT SUBMIT COMPETENT ADMISSIBLE EVIDENCE TO SUPPORT ITS OPPOSITION For the following reasons, and as detailed in AllenCo’s Objections filed with this Reply, Plaintiff failed to submit competent admissible evidence and it should not be considered by this Court when ruling on AllenCo’s motion: Deposition Testimony of Mick Beyer (Exhibit 3 to Athnassia’s Compendium of Evidence (“Athnassia’s Compendium”): Plaintiff fails to disclose to the Court that the excerpt cited in Plaintiff’s opposition does not address the Second Agreement, or the Final Settlement. This testimony is completely irrelevant to the interpretation of the Final Settlement. See SSDMF p. 3:8-11; See Also AllenCo Objections to Athnassia’s Evidence, 9 7-8. Further, Plaintiff’s inadmissible declarations make clear that Mr. Beyer was not involved in the discussions Oo 0 9 O N wn BA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo involving the Final Settlement, rendering this testimony irrelevant, prejudicial, and thus, inadmissible. Bruce King Testimony (Exhibit 1 to Athnassia’s Compendium): Although Plaintiff makes clear the only breach it alleges pertains to AllenCo’s failure to comply with the DOGGR permit under the First Agreement, Plaintiff seeks to use testimony from the deposition transcript of cross-defendant Pieco, Inc.’s person most knowledgeable, Bruce King, simply to muddy the waters. While not cited in the actual opposition memorandum, Plaintiff attempts to cite this testimony to demonstrate AllenCo damaged the well. This testimony is completely irrelevant to the Final Settlement. Further, Athnaassia fails to disclose to the Court that this testimony conflicts with Mr. King’s testimony in a prior lawsuit, wherein he acknowledges Pieco, the company Plaintiff hired subsequent to AllenCo, knocked over the casing. “A: I have my theory, but the best logic is the fact that the cavity shot that was shot down created so much damage, and we did so many trips in and out of the hole to try to complete the abandonment that it broke off and fell over.” See, Deposition Transcript of Bruce King pp. 139:22-140:2, taken August 20, 2018 in the Armstrong Oil v. Pieco, Inc. OCSC Sup. Ct. Case No. 30-2016-00881376-CU-PO- CJC. Additionally, this testimony completely lacks foundation, as Mr. King acknowledges Pieco has never abandoned or re-abandoned a well, and just like Plaintiff, he has no experience with such work which would qualify him to render such an opinion. See AllenCo Objections to Athnassia’s Evidence, 9 6. Declaration of Makram Youseff: This declaration is not a sworn affidavit made under penalty of perjury as required by Code of Civil Procedure section 2015.5. See Kulshrestha v. First Union Commercial Corp, 33 Cal.4th 601, 612-613 (2004); See AllenCo Objections to Athnassia’s Evidence, 9 10. This declaration does not constitute admissible evidence disputing any material fact relevant to the instant motion. The declaration provides no relevant, admissible evidence as to Athnassia’s objective manifestations of consent when it agreed to the Final Settlement. Declaration of Emad Bolous: A majority of this declaration constitutes pure speculation, and lacks foundation. Mr. Bolous states “it is important to know that I am a complete neophyte © 0 9 O N nn kA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo with absolutely no experience with oil wells, drilling, [DOGGR].” Bolous Decl. 9 19; See AllenCo Objections to Athnassia’s Evidence, 9 1-3. Mr. Bolous’s speculative allegations are further contradicted by the statements made in its verified complaint wherein it alleged that Pieco itself was the one who damaged [the stub of the casing at about 720 ft. underground.” See Request for Judicial Notice, No. 1, Plaintiff's Complaint against Pieco. Deposition Testimony of Mr. Bolous (Exhibit 2 to Athnassia’s Compendium): This testimony is completely irrelevant. See AllenCo Objections to Athnassia’s Evidence, q 4. Whether or not Mr. Bolous was aware AllenCo was going to pour cement at a lower depth prior to it doing so is not at issue in the motion. This testimony does not refute AllenCo’s undisputed statement of fact (See UMF q 11), that at the time Plaintiff entered into the Second Agreement, and the Final Settlement, it was aware of the alleged breach. Deposition Testimony of Tim Parker (Exhibit 4 to Athnassia’s Compendium): While it is not clear what relevance Athnassia’s reference to Mr. Parker’s deposition from a different action has on the instant motion, this testimony, given in a different matter, is inadmissible hearsay, as Athnassia has not made the foundational showing required by Evidence Code section 1291. See AllenCo Objections to Athnassia’s Evidence, 4 9. Letter from DOGGR to Emad Bolous, Athnassia (Exhibit 5 to Athnassia’s Compendium): This letter is completely irrelevant to the instant motion, as it appears to be referred to in order to describe the nature of the breach. Nonetheless, while the letter constitutes inadmissible hearsay to the extent it is offered for the truth of the matter asserted within, it demonstrates Athnassia was undisputedly aware of the alleged breach prior to entering the Final Settlement Agreement as it was dated August 24, 2015, more than two months prior to the Final Settlement. See AllenCo Objections to Athnassia’s Evidence, 4 11. III. CONCLUSION AllenCo’s motion should be granted in its entirety based on Athnassia’s complete failure to dispute the material facts established in AllenCo’s moving papers. Even if Athnassia’s deficient opposition is considered on its face, Athnassia fails to establish the existence of a 10 Oo 0 9 O N wn BA W N = N N N N N N N N ND m m e m e m e m e m e m e m e m co JI NN wn BRA W N Y D = D O O N N N R A W ND = Oo triable issue of disputed fact with competent and admissible evidence to defeat AllenCo’s motion. AllenCo respectfully requests the Court grant its motion in its entirety. Date: January 3, 2019 BASSI, EDLIN, HUIE & BLUM LLP J D0 1 ¥ DANIEL E. TROWBRIDGE Attorneys for Defendant C.E. ALLEN COMPANY, INC., D/B/A ALLENCO 11
