On 02/18/2020 LAW OFFICES OF DILIP VITHLANI, A PC filed a Contract - Other Contract lawsuit against PRIORITYWORKFORCE INC. This case was filed in Los Angeles County Superior Courts, Spring Street Courthouse located in Los Angeles, California. The Judge overseeing this case is SERENA R. MURILLO. The case status is Disposed - Judgment Entered.
Disposed - Judgment Entered
SERENA R. MURILLO
LAW OFFICES OF DILIP VITHLANI A PC
WITT ESQ TREVOR R
12/29/2020: Opposition (name extension) - Opposition to Motion for Summary Judgment/Adjudication
12/29/2020: Separate Statement - Separate Statement
12/29/2020: Objection (name extension) - Objection Evidentiary Objections to Declaration of DeLozier
1/8/2021: Response (name extension) - Response DEFENDANTS RESPONSE TO PLAINTIFFS SEPARATE STATEMENT OF DISPUTED AND UNDISPUTED FACTS IN SUPPORT OF ITS REPLY TO MOTION FOR SUMMARY JUDGMENT, OR IN THE ALTERNATI
1/8/2021: Reply (name extension) - Reply REPLY
1/8/2021: Objection (name extension) - Objection EVIDENTIARY
1/13/2021: Certificate of Mailing for - Certificate of Mailing for (Hearing on Motion for Summary Judgment) of 01/13/2021
1/13/2021: Minute Order - Minute Order (Hearing on Motion for Summary Judgment)
8/12/2020: Brief (name extension) - Brief COMPENDIUM OF EVIDENCE IN SUPPORT OF DEFENDANTS MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, SUMMARY ADJUDICATION OF ISSUES
8/12/2020: Memorandum of Points & Authorities - Memorandum of Points & Authorities
8/12/2020: Motion for Summary Judgment - Motion for Summary Judgment
8/12/2020: Separate Statement - Separate Statement
4/29/2020: Answer - Answer
2/20/2020: Summons - Summons on Complaint
2/20/2020: Civil Case Cover Sheet - Civil Case Cover Sheet
2/18/2020: First Amended Standing Order - First Amended Standing Order
2/18/2020: Complaint - Complaint
2/18/2020: Notice of Case Assignment - Limited Civil Case - Notice of Case Assignment - Limited Civil Case
DocketNon-Jury Trial scheduled for 08/17/2021 at 08:30 AM in Spring Street Courthouse at Department 26 Not Held - Vacated by Court on 08/09/2021Read MoreRead Less
DocketOrder to Show Cause Re: Failure to File Proof of Service scheduled for 02/21/2023 at 08:30 AM in Spring Street Courthouse at Department 26 Not Held - Vacated by Court on 08/09/2021Read MoreRead Less
DocketUpdated -- Motion for Summary Judgment: Filed By: PriorityWorkForce Inc. (Defendant); Result: Granted; Result Date: 01/13/2021Read MoreRead Less
DocketCourt orders judgment entered for Defendant PriorityWorkForce Inc. against Plaintiff Law Offices of Dilip Vithlani, A PC on the Complaint filed by Law Offices of Dilip Vithlani, A PC on 02/18/2020 for a total of $0.00.Read MoreRead Less
DocketMinute Order (Hearing on Motion for Summary Judgment)Read MoreRead Less
DocketCertificate of Mailing for (Hearing on Motion for Summary Judgment) of 01/13/2021; Filed by: ClerkRead MoreRead Less
DocketHearing on Motion for Summary Judgment scheduled for 01/13/2021 at 10:30 AM in Spring Street Courthouse at Department 26 updated: Result Date to 01/13/2021; Result Type to Held - Motion GrantedRead MoreRead Less
DocketResponse DEFENDANT?S RESPONSE TO PLAINTIFF?S SEPARATE STATEMENT OF DISPUTED AND UNDISPUTED FACTS IN SUPPORT OF ITS REPLY TO MOTION FOR SUMMARY JUDGMENT, OR IN THE ALTERNATIVE, SUMMARY ADJUDICATION OF ISSUES; Filed by: PriorityWorkForce Inc. (Defendant)Read MoreRead Less
DocketObjection EVIDENTIARY; Filed by: PriorityWorkForce Inc. (Defendant)Read MoreRead Less
DocketReply REPLY; Filed by: PriorityWorkForce Inc. (Defendant)Read MoreRead Less
DocketAnswer; Filed by: PriorityWorkForce Inc. (Defendant); As to: Law Offices of Dilip Vithlani, A PC (Plaintiff)Read MoreRead Less
DocketProof of Personal Service; Filed by: Law Offices of Dilip Vithlani, A PC (Plaintiff); As to: PriorityWorkForce Inc. (Defendant); Service Date: 02/26/2020; Service Cost Waived: NoRead MoreRead Less
DocketNon-Jury Trial scheduled for 08/17/2021 at 08:30 AM in Spring Street Courthouse at Department 26Read MoreRead Less
DocketOrder to Show Cause Re: Failure to File Proof of Service scheduled for 02/21/2023 at 08:30 AM in Spring Street Courthouse at Department 26Read MoreRead Less
DocketSummons on Complaint; Issued and Filed by: Law Offices of Dilip Vithlani, A PC (Plaintiff); As to: PriorityWorkForce Inc. (Defendant)Read MoreRead Less
DocketCivil Case Cover Sheet; Filed by: Law Offices of Dilip Vithlani, A PC (Plaintiff)Read MoreRead Less
DocketCase assigned to Hon. Serena R. Murillo in Department 26 Spring Street CourthouseRead MoreRead Less
DocketComplaint; Filed by: Law Offices of Dilip Vithlani, A PC (Plaintiff); As to: PriorityWorkForce Inc. (Defendant)Read MoreRead Less
DocketNotice of Case Assignment - Limited Civil Case; Filed by: ClerkRead MoreRead Less
DocketFirst Amended Standing Order; Filed by: ClerkRead MoreRead Less
Case Number: 20STLC01625 Hearing Date: January 13, 2021 Dept: 26
Law Offices of Dilip Vithlani, PC v. Priority Workforce, Inc., et al.
MOTION FOR SUMMARY JUDGMENT / ADJUDICATION
(CCP § 437c)
Defendant Priority WorkForce, Inc.’s Motion for Summary Judgment is GRANTED.
Plaintiff Law Offices of Dilip Vithlani, PC (“Plaintiff”) filed the instant action for fraud in the inducement and breach of contract against Defendant Priority WorkForce, Inc. (“Defendant”) on February 18, 2020. Defendant filed its Answer on April 29, 2020.
Defendant filed the instant Motion for Summary Judgment, or in the alternative, Summary Adjudication (“the Motion”) on August 12, 2020. Plaintiff filed an opposition on December 29, 2020.
Evidentiary objections on a motion for summary judgment or adjudication must comport with the formatting requirements of Cal. Rules of Court Rule 3.1354. Defendant’s evidentiary objections are not in the required format, in fact, they are not even numbered. In any event, the objections made to the declaration of Robin DeLozier are that it “misstates the contents of the documents.” The Court is not aware of any such evidentiary objection to the contents of a document and Defendant offers no citation to legal authority in support of the objection. Therefore, the objections are overruled.
Allegations in the Complaint
Plaintiff alleges that it entered into an agreement with Defendant for the payment of attorney fees, which Defendant has since breached. Specifically, one of Defendant’s employees, Gerardo Garcia (“Garcia”) retained Plaintiff about bringing claims for failure to timely pay wages. (Compl., ¶¶7-10.) On February 5, 2020, Plaintiff contacted Defendant to settle the claims. (Id. at ¶11.) On February 6, 2020, Defendant offered to pay Garcia’s waiting time penalties under Cal. Labor Code section 203 and $1,000.00 in attorney fees as to Plaintiff. (Id. at ¶12.) Plaintiff counter-offered for payment of the penalties and $2,000.00 in fees. (Id. at ¶13.) Defendant allegedly accepted the offer the same day. (Id. at ¶14.) Despite paying Garcia the waiting time penalties, Plaintiff alleges that Defendant has not paid the attorney fees as agreed. (Id. at ¶¶15-17 and Exh. A.)
The Complaint alleges one cause of action for fraudulent inducement of contract, which additionally seeks punitive damages, and one cause of action for breach of contract.
1st Cause of Action for Fraud in the Inducement
Fraud in the inducement occurs when “ ‘the promisor knows what he is signing but his consent is induced by fraud, mutual assent is present and a contract is formed, which, by reason of the fraud, is voidable ....’ ” [Citation.]’ ” (Julius Castle Restaurant Inc. v. Payne (2013) 216 Cal.App.4th 1423, 1440.) As with any cause of action for intentional fraud, Plaintiff must prove (1) a misrepresentation (false representation, concealment, or nondisclosure); (2) scienter or knowledge of its falsity; (3) intent to induce reliance; (4) justifiable reliance; and (5) resulting damage. (See Hinesley v. Oakshade Town Ctr. (2005) 135 Cal.App.4th 289, 294.)
a. Economic Loss Rule (Issue 1)
Defendant first argues against this cause of action based on the economic loss rule, which prohibits the recovery of purely economic damages through a tort claim. (Citing Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 988.) “The existence of damages other than purely economic loss is an element of a plaintiff’s common law cause of action.” (Greystone Homes, Inc. v. Midtec, Inc. (2008) 168 Cal.App.4th 1194, 1215.) Therefore, Plaintiff bears the burden of demonstrating the existence of non-economic loss.
Contrary to Plaintiff’s assertion that the economic loss rule only applies in contracts for good, in Food Safety Net Services v. Eco Safe Systems USA, Inc. (2012) 209 Cal.App.4th 1118, 1130-1132, the Court of Appeals upheld a finding by the trial court that the economic loss rule barred a claim for fraud in the inducement on a contract for services. (Safety Net Services v. Eco Safe Systems USA, Inc. (2012) 209 Cal.App.4th 1118.) Specifically, the Court of Appeals affirmed that because the plaintiff had not demonstrated any misrepresentation beyond a broken contractual promise, it could not recover non-economic damages. (Id. at 1131-1132.)
While the economic loss rule could be applied in this action, Defendant has not shown that the rule bars Plaintiff’s fraud cause of action. Defendant simply argues that the fraud and breach of contract claim are identically based solely on the failure to pay the attorney fees. (Motion, p. 5:6-10.) The causes of action, however, are not identical. Paragraph 20 of the Complaint makes the specific allegation that “Defendants made representations to the Plaintiff that payment of fees would be made in order to prevent Plaintiff from filing a complaint with the Los Angeles Superior Court thus entitling Plaintiff to attorney’s fees and costs. [In other words], Defendant made a promise to the Plaintiff that fees would be paid without judicial intervention.” (Compl., ¶20 (emphasis added).) Nor does Defendant’s separate statement for this issue even address this allegation. Instead, the facts pertain only to whether the parties entered into a valid contract. (Motion, Separate Statement, Facts Nos. 1-16.)
b. Reasonable Reliance
Defendant also argues that the fraud cause of action fails because Plaintiff could not have reasonably relied on any representation to his detriment. Since Plaintiff was negotiating a settlement on behalf of its client, Garcia, and not to obtain any personal benefit, Plaintiff could not have changed its position based on anything Defendant said. Defendant further suggests that Plaintiff would be violating Professional Rules of Conduct 1-500 if it claims to be a party to the settlement agreement between Defendant and Garcia.
In support of this, Defendant points to the settlement negotiations in which it specifically offered to pay 17 days’ worth of wages and $1,000.00 in attorney fees to Garcia. (Motion, Separate Statement, Issue III, Fact No. 2; DeRozier Decl., Exh. A, p. 4.) In rejecting that offer and during the parties’ further discussions, Plaintiff did not address whether the attorney fees were to be paid directly to Garcia or separately to Plaintiff. (Motion, Separate Statement, Issue III, Fact Nos. 2-9; DeRozier Decl., Exh. A.) Defendant also points to the settlement negotiations as evidence that the only claims at play were those asserted by Garcia, such that Plaintiff could not have been deprived of any benefit from statements made by Defendant. (Motion, Separate Statement, Issue III, Fact Nos. 2-9; DeRozier Decl., Exh. A.) This carries Defendant’s initial burden of proof with respect to the element of reasonable reliance in the fraud cause of action and shifts the burden of proof to Plaintiff.
Plaintiff’s evidence in opposition does not address what it had at stake in the negotiations regarding Garcia’s claims for wage and hour violations against Defendant. The opposition argues only that in reliance on the agreement, Plaintiff emailed Defendant a W-9 form and did not file a complaint to recover waiting time penalties. (Opp., p. 6:12-20; Opposing Separate Statement, Issue VII, Fact No. 32.) Notably, the opposition does not explain how either action was to Plaintiff’s own detriment. Emailing Defendant a W-9 form did not make Plaintiff’s position worse, nor did not filing a case for waiting time penalties. A case for waiting time penalties on behalf of Garcia had nothing to do with Plaintiff’s rights against Defendant.
Therefore, the Court finds that no triable issues of material fact exist with respect to Plaintiff’s inability to prove the element of reasonable reliance for the first cause of action for fraud.
c. Existence of a Contract
Finally, Defendant argues there can be no cause of action for fraudulent inducement without the existence of a contract and that the contract cannot exist without a “meeting of the minds.” “The failure to reach a meeting of the minds on all material points prevents the formation of a contract even though the parties have orally agreed upon some of the terms or have taken some action related to the contract.” (Bustamante v. Intuit, Inc. (2006) 141 Cal.App.4th 199, 215.)
Defendant presents evidence that the parties did not reach an agreement on the terms, as follows: On February 5, 2020, Plaintiff contacted Defendant to resolve Garcia’s alleged labor code violations. (Motion, Separate Statement, Fact No. 1; DeRozier Decl., Exh. A, p. 5; Witt Decl., Exh. C.) Defendant made an offer of payment of 17 days of Garcia’s wages and $1,000.00 in attorney fees. (Motion, Separate Statement, Fact No. 1; DeRozier Decl., Exh. A, p. 4.) In order to accept the offer, Plaintiff was to provide Defendant with a W-9 and a settlement release. (Motion, Separate Statement, Fact No. 2; DeRozier Decl., Exh. A, p. 4.) Plaintiff rejected the offer because his attorney fees were “not subject to negotiation.” (Motion, Separate Statement, Fact No. 3; DeRozier Decl., Exh. A, p. 3.) On February 6, 2020, Defendant again requested a W-9 form and release agreement, which Plaintiff refused to provide because there was no agreement. (Motion, Separate Statement, Fact Nos. 7-8; DeRozier Decl., Exh. A, p. 2.) Defendant then agreed to the term of $2,000.00 in attorney fees. (Motion, Separate Statement, Fact No. 9; DeRozier Decl., Exh. A, p. 1.)
Defendant never believed that it was negotiating direct benefits for Plaintiff under the settlement agreement. (Motion, Separate Statement, Issue II, Fact Nos. 14-15; DeLozier Decl., ¶¶15-16; Witt Decl., ¶4.) It was always Defendant’s position that the negotiations were solely to address Garcia’s claims and not to resolve any claims Plaintiff might have against Defendant. (Motion, Separate Statement, Issue II, Fact Nos. 14-15; DeLozier Decl., ¶¶15-16; Witt Decl., ¶4.)
In a similar vein, Defendant argues that there was no contract because there was no consideration exchanged. Consideration is defined as “[a]ny benefit conferred, or agreed to be conferred, upon the
promisor, by any other person, to which the promisor is not lawfully entitled, or any prejudice
suffered, or agreed to be suffered, by such person, other than such as he is at the time of consent
lawfully bound to suffer, as an inducement to the promisor.” (Civ. Code, § 1605.) As discussed above, Plaintiff itself did not suffer any prejudice to induce the promise of payment from Defendant.
Defendant’s evidence, therefore, demonstrates that there was no agreement between itself and Plaintiff that provided for payment of attorney fees. To the extent any agreement existed, it was between Defendant and Garcia, with Plaintiff acting as Garcia’s representative. This carries Defendant’s initial burden of proof regarding the lack of any contract that was fraudulently induced. The burden now shifts to Plaintiff to present evidence creating a triable issue of material fact.
In opposition, Plaintiff presents the declarations of Garcia and its principal, Dilip Vithlani. Neither declaration, however, demonstrates that the parties were on the same page regarding payment of attorney fees directly to Plaintiff such that there was any agreement directly between Plaintiff and Defendant. (Opp., Separate Statement, Issue II, Fact Nos. 14-15; Garcia Decl., ¶¶6-10; Vithlani Decl., ¶¶10-13.) Therefore, Plaintiff has not demonstrated any triable issues of fact regarding the existence of an agreement between the parties that would support a cause of action for fraud in the inducement.
2nd Cause of Action for Breach of Contract
“The essential elements of a claim of breach of contract, whether express or implied, are the contract, the plaintiff's performance or excuse for nonperformance, the defendant’s breach, and the resulting damages to the plaintiff.” (Green Valley Landowners Assn. v. City of Vallejo (2015) 241 Cal.App.4th 425, 433.) As discussed above, no triable issues of material fact have been shown regarding the existence of a contract. Therefore, Plaintiff cannot prevail on its cause of action for breach of contract.
Defendant Priority WorkForce, Inc.’s Motion for Summary Judgment is GRANTED.
Moving party to give notice.
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