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This case was last updated from Los Angeles County Superior Courts on 12/21/2019 at 15:46:24 (UTC).

GLENDALE ACCEPTANCE VS YVONNE JOHNSON

Case Summary

On 06/17/2016 GLENDALE ACCEPTANCE filed a Property - Other Real Property lawsuit against YVONNE JOHNSON. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The Judge overseeing this case is DALILA CORRAL LYONS. The case status is Pending - Other Pending.

Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    ****4204

  • Filing Date:

    06/17/2016

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Property - Other Real Property

  • Court:

    Los Angeles County Superior Courts

  • Courthouse:

    Stanley Mosk Courthouse

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judge

DALILA CORRAL LYONS

 

Party Details

Plaintiff and Petitioner

GLENDALE ACCEPTANCE

Defendants, Respondents and Cross Defendants

DOES 1 - 10

JOHNSON YVONNE

MANESH YVONNE

JOHNSON YVONNE AKA YVONNE MANESH AKA YVONNE YVONNE JOHNSON

Defendants and Respondents

DOES 1 - 10

JOHNSON YVONNE

MANESH YVONNE

Defendants, Cross Plaintiffs and Cross Defendants

JOHNSON YVONNE AKA YVONNE MANESH AKA YVONNE YVONNE JOHNSON

JOHNSON YVONNE AKA YVONNE MANESH

DAVANI JEFF

WESTCO INSURANCE COMPANY

DAVANI M. J. AKA MAHMOOK JAFARZADEH DAVANI

DAVANI JEFF DBA ARINA BUILDERS

STATE NATONAL INSURANCE COMPANY INC.

BUSINESS ALLIANCE INSURANCE COMPANY

GONZALEZ ASCENCION AKA ASENCION GONZALEZ

ISAYAN KHOREN

GLENDALE ACCEPTANCE LLC

DAVANI MASOOD

AGC BUILDLERS INC A CALIFORNIA CORPORATION ERRONEOUSLY SUED AS ROE 6

Attorney/Law Firm Details

Plaintiff and Petitioner Attorneys

PARIKH SAGAR ESQ.

PARIKH SAGAR P. ESQ.

Cross Plaintiff and Cross Defendant Attorneys

LIBO DAVID J.

SANDERS STEPHEN M.

SOSA CARLOS

REIN STEVEN

MINASSIAN NATALIA

DORENFELD DAVID K

 

Court Documents

Minute Order - MINUTE ORDER (COURT ORDER:)

5/16/2019: Minute Order - MINUTE ORDER (COURT ORDER:)

Notice of Mandatory Evaluation Conference - NOTICE OF MANDATORY EVALUATION CONFERENCE NOTICE OF MANDATORY SETTLEMENT CONFERENCE

7/23/2019: Notice of Mandatory Evaluation Conference - NOTICE OF MANDATORY EVALUATION CONFERENCE NOTICE OF MANDATORY SETTLEMENT CONFERENCE

Proof of Service by Substituted Service

8/12/2019: Proof of Service by Substituted Service

Memorandum of Costs (Summary)

8/23/2019: Memorandum of Costs (Summary)

Summons - SUMMONS ON AMENDED CROSS COMPLAINT (1ST)

9/10/2019: Summons - SUMMONS ON AMENDED CROSS COMPLAINT (1ST)

Request for Entry of Default / Judgment

10/7/2019: Request for Entry of Default / Judgment

Answer

10/21/2019: Answer

Opposition - OPPOSITION TO MOTION TO TAX COSTS

11/13/2019: Opposition - OPPOSITION TO MOTION TO TAX COSTS

NOTICE OF MOTION AND MOTION TO BE RELIEVED AS COUNSEL-CIVIL

1/26/2018: NOTICE OF MOTION AND MOTION TO BE RELIEVED AS COUNSEL-CIVIL

DEFENDANT AND CROSS-COMPLAINANT YVONNE JOHNSON'S NOTICE OF MOTION AND MOTION FOR AN ORDER COMPELLING CROSSDEFENDANT JEFF DAVANI'S RESPONSES TO REQUEST FOR PRODUCTION OF DOCUMENTS, SET ONE AND FOR AN O

3/28/2018: DEFENDANT AND CROSS-COMPLAINANT YVONNE JOHNSON'S NOTICE OF MOTION AND MOTION FOR AN ORDER COMPELLING CROSSDEFENDANT JEFF DAVANI'S RESPONSES TO REQUEST FOR PRODUCTION OF DOCUMENTS, SET ONE AND FOR AN O

DEFENDANT AND CROSS-COMPLAINANT YVONNE JOHNSON'S NOTICE OF MOTION AND MOTION FOR AN ORDER DEEMING MATTERS IN REQUESTS FOR ADMISSION SET ONE ADMITTED AND FOR AN ORDER IMPOSING MONETARY SANCTIONS AGAINS

3/28/2018: DEFENDANT AND CROSS-COMPLAINANT YVONNE JOHNSON'S NOTICE OF MOTION AND MOTION FOR AN ORDER DEEMING MATTERS IN REQUESTS FOR ADMISSION SET ONE ADMITTED AND FOR AN ORDER IMPOSING MONETARY SANCTIONS AGAINS

NOTICE OF RULING AFTER STATUS CONFERENCE

4/3/2018: NOTICE OF RULING AFTER STATUS CONFERENCE

PROOF OF SERVICE OF DECLARATION RE DEFENDANT'S MOTION TO COMPEL WRITTEN DISCOVERY, ATTENDANCE AND TESTIMONY OF JEFF DAVANI

4/27/2018: PROOF OF SERVICE OF DECLARATION RE DEFENDANT'S MOTION TO COMPEL WRITTEN DISCOVERY, ATTENDANCE AND TESTIMONY OF JEFF DAVANI

OPPOSITION TO DEFENDANT/CROSS- COMPLAINANT YVONNE JOHN SON'S (1) MOTION TO COMPEL RESPONSES TO FORM INTERROGATORIES, SET ONE; (2) MOTION TO COMPEL RESPONSES TO REQUEST FOR PRODUCTION OF DOCUMENTS; ETC

5/1/2018: OPPOSITION TO DEFENDANT/CROSS- COMPLAINANT YVONNE JOHN SON'S (1) MOTION TO COMPEL RESPONSES TO FORM INTERROGATORIES, SET ONE; (2) MOTION TO COMPEL RESPONSES TO REQUEST FOR PRODUCTION OF DOCUMENTS; ETC

RULING

5/10/2018: RULING

Proof of Service by 1st Class Mail -

6/13/2017: Proof of Service by 1st Class Mail -

DECLARATION OF STEPHEN M. SANDERS RE OSC

6/28/2017: DECLARATION OF STEPHEN M. SANDERS RE OSC

Minute Order -

7/10/2017: Minute Order -

157 More Documents Available

 

Docket Entries

  • 06/01/2020
  • Hearing06/01/2020 at 09:30 AM in Department 20 at 111 North Hill Street, Los Angeles, CA 90012; Jury Trial

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  • 05/20/2020
  • Hearing05/20/2020 at 08:30 AM in Department 20 at 111 North Hill Street, Los Angeles, CA 90012; Final Status Conference

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  • 05/14/2020
  • Hearing05/14/2020 at 08:30 AM in Department 20 at 111 North Hill Street, Los Angeles, CA 90012; Status Conference

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  • 01/29/2020
  • Hearing01/29/2020 at 08:30 AM in Department 20 at 111 North Hill Street, Los Angeles, CA 90012; Hearing on Motion to Tax Costs

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  • 12/10/2019
  • DocketNotice Re: Continuance of Hearing and Order ([of Motion]); Filed by Clerk

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  • 12/03/2019
  • Docketat 1:30 PM in Department 20, Dalila Corral Lyons, Presiding; Hearing on Motion to Tax Costs (Filed by Plaintiff Glendale Acceptance - crs# 398263289967) - Not Held - Advanced and Continued - by Court

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  • 12/02/2019
  • Docketat 09:30 AM in Department 20, Dalila Corral Lyons, Presiding; Jury Trial - Not Held - Advanced and Continued - by Court

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  • 11/20/2019
  • Docketat 08:30 AM in Department 20, Dalila Corral Lyons, Presiding; Final Status Conference (AndStatus of Cross-Complaint filed on 9/10/19 by Wesco Insurance) - Not Held - Advanced and Continued - by Court

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  • 11/18/2019
  • Docketat 08:30 AM in Department 20, Dalila Corral Lyons, Presiding; Hearing on Ex Parte Application (to Continue Trial and Extend Discovery and Other Deadlines Consistent with the new Trial Date; Declaration of Steven Rein; Memorandum of Points and Authorities) - Held - Advanced and Heard

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  • 11/15/2019
  • Docketat 3:34 PM in Department 20, Dalila Corral Lyons, Presiding; Ex-Parte Proceedings

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322 More Docket Entries
  • 08/16/2016
  • DocketOSC-Failure to File Proof of Serv; Filed by Clerk

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  • 08/16/2016
  • DocketNOTICE OF CASE MANAGEMENT CONFERENCE

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  • 07/29/2016
  • Docketat 1:30 PM in Department 24; Unknown Event Type - Held

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  • 07/29/2016
  • DocketMinute order entered: 2016-07-29 00:00:00; Filed by Clerk

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  • 06/21/2016
  • DocketPEREMPTORY CHALLENGE TO JUDICIAL OFFICER (CODE CIV. PROC., 170.6)

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  • 06/21/2016
  • DocketPeremptory Challenge to Judicial Officer (CCP 170.6) against the Honorable Robert L. Hess, Dept. 24; Filed by Glendale Acceptance (Plaintiff)

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  • 06/20/2016
  • DocketSUMMONS

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  • 06/17/2016
  • DocketNOTICE OF PENDENCY OF ACTION

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  • 06/17/2016
  • DocketCOMPLAINT FOR: 1. QUANTUM MERUIT 2. WORK, LABOR, AND MATERIALS 3. FORECLOSURE OF MECHANIC'S LIEN

    Read MoreRead Less
  • 06/17/2016
  • DocketComplaint; Filed by null

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Tentative Rulings

Case Number: BC624204    Hearing Date: November 19, 2020    Dept: 20

Tentative Ruling

Judge David J. Cowan

Department 20


Hearing Date:     Thursday, November 19, 2020

Case Name: Glendale Acceptance v. Yvonne Johnson

Case No.: BC624204

Motion: Summary Judgment

Moving Party: Cross-Defendant Business Alliance Insurance Company

Responding Party: Cross-Complainant Yvonne Johnson

Notice: OK


Ruling: The Motion for Summary Judgment is DENIED.

Johnson to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LA Court Connect rather than in person in view of the ongoing COVID-19 pandemic


BACKGROUND

On June 17, 2016, Plaintiff Glendale Acceptance LLC filed a Complaint against Defendant Yvonne Johnson, stating claims for quantum meruit, work, labor and materials, and foreclosure of mechanic’s lien. The claims arose out of a construction project undertaken for Johnson by Plaintiff’s assignor, contractor Arina Builders, for which Johnson allegedly did not pay.

On April 19, 2017, Johnson filed a Cross-Complaint against Jeff Davani, an individual dba Arina Builders; Glendale Acceptance LLC; State National Insurance Company, Inc.; Business Alliance Insurance Company (“BAIC”); and Roes 1-50, stating claims for negligence, breach of contract, fraud, breach of fiduciary duty, constructive fraud, disgorgement against unlicensed contractor, recovery on contractor's license bond, tortious interference with contract, implied equitable indemnity, and seeking declaratory relief.

On April 27, 2017, Johnson filed a First Amended Cross-Complaint stating the same claims against the same parties.

On August 10, 2017, Johnson filed a Second Amended Cross-Complaint (“SACC”) against Davani (dba Arina Builders); Glendale Acceptance LLC; BAIC; and Roes 1-50, stating the same claims with an additional slander of title claim. Johnson seeks to recover against BAIC on the contractor’s bond it issued to Davani. Separately, Johnson seeks disgorgement of funds paid to Davani on the ground that Davani is unlicensed for failing to obtain workers’ compensation insurance for all the employees on the construction project.

On May 29, 2020, BAIC filed a Motion for Summary Judgment on Johnson’s contractor’s bond crossclaim in the SACC on the ground that the bond was voided when Davani’s license was automatically suspended for not obtaining workers’ compensation insurance when required.

On September 29, 2020, Johnson filed an Opposition.

On October 9, 2020, BAIC filed a Reply.

On October 15, 2020, the Court continued the Motion for Summary Judgment, requesting input on the following issues: (1) whether Bus. & Prof. Code sec. 7071.5 is consistent with that provision of the Bond which causes it to automatically void upon violations of Bus. & Prof. Code sec. 7000 et seq. even though the contractor’s bond is for the benefit of a homeowner “damaged as a result of a violation of this chapter by the licensee,” and whether this is an equitable result; (2) when exactly Johnson’s construction project finished; (3) whether authentication and/or a hearsay exception is required for admission of the CSLB’s citation of Davani; and (4) whether authentication and/or a hearsay exception is required for admission of the CSLB’s workers’ compensation insurance exemption history for Davani.

On November 9, 2020, BAIC filed its Supplemental Brief on these issues.

On November 13, 2020, Johnson filed her Supplemental Brief on these issues.

 

DISCUSSION

Applicable Law

Summary judgment is proper when the moving party is entitled to judgment as a matter of law and there are no triable issues of material fact. (CCP sec. 473c(c).) In analyzing such motions, courts must apply a three-step analysis: “(1) identify the issues framed by the pleadings; (2) determine whether the moving party has negated the opponent’s claims; and (3) determine whether the opposition has demonstrated the existence of a triable, material factual issue.” (Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 294.) The moving party must satisfy the initial burden of proof by presenting facts to negate or establish an essential element of each claim at issue. (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520.) Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.” (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.)

Once the moving party has met its burden, the burden shifts to the opposing party to show via specific facts that a triable issue of material fact exists. (CCP § 437c(o)(2).) “Materiality is measured by the law applicable to the legal theories put in issue by the complaint [or petition].” (Panattoni v. Superior Court (1988) 203 Cal.App.3d 1092, 1094.) Factual issues are immaterial if they are “outside the scope of the pleadings.” (AARTS Production, Inc. v. Crocker National Bank (1986) 176 Cal.App.3d 1601, 1065.)

Application to Facts

Judicial Notice

BAIC requests judicial notice of the May 5, 2017 citation against Davani for abandoning a project and failing to obtain workers’ compensation insurance. (See Dorenfeld Decl., Ex. C). Johnson objects to judicial notice of this citation on the ground that it is unclear whether the citation was challenged and, if so, ultimately upheld by the reviewing board. However, this does not preclude judicial notice; the citation is still an official action of a government agency, the CSLB. Johnson objects in her Supplemental Brief that the Court cannot take judicial notice of the truth of the matters in the citation. The Court agrees; the Court cannot take judicial notice of the facts stated in the citation (e.g. that Davani failed to obtain workers’ compensation insurance) and takes notice only that the CSLB cited Davani on that ground. Thus, the Court takes judicial notice of the citation in that regard.

Next, Johnson requests judicial notice of the CSLB’s certified license history for Davani from January 1, 2014 to March 3, 2017. The certified license history states that Davani’s license “has an ‘Exemption from Workers’ Compensation Insurance’ in effect 01/01/14, on file.” The record states: “Contractor’s Bond . . . written by Business Alliance Insurance Company in the amount of $12,500 was in effect 01/01/14; upgraded to $15,000 effective 01/01/16.” The history indicates that Davani was suspended on April 23, 2015, reinstated on May 8, 2015, suspended again on July 20, 2016, and reinstated on August 4, 2016. BAIC does not object to the Court taking judicial notice of the licensing record; the Court takes judicial notice.

Evidentiary Objections

Johnson objects to all three items of evidence provided by BAIC in the Dorenfeld Declaration (Davani’s deposition, exemption record, and CSLB citation) on the grounds of lack of personal knowledge, lack of foundation, irrelevance, hearsay, and improper use of deposition testimony. At the outset, the “improper use of deposition testimony” objection is clearly meritless as to the CSLB records submitted and is OVERRULED. The relevance and hearsay objections are also OVERRULED.

Johnson argues Davani’s deposition is inadequately authenticated and lacks foundation because it is neither signed nor certified. However, Johnson already used Davani’s March 2019 deposition in support of her own Motion for Summary Judgment filed July 15, 2019. The Court takes judicial notice of the Khalilpour Declaration submitted in support of that Motion, in which Exhibit C is Davani’s March 2019 deposition. Therefore, this objection is OVERRULED. (See Ambriz v. Kelegian (2007) 146 Cal.App.4th 1519, 1527 (holding it was error to sustain a party’s authenticity/foundation objections to deposition excerpts if that party previously used excerpts from that deposition in support of its own motion); Evid. Code sec. 1414.)

Johnson argues the CSLB citation and exemption history are inadequately authenticated. Dorenfeld declared that the CSLB exemption history in Exhibit B “is a true and correct copy of a printout” from the CSLB. Dorenfeld declared that the CSLB citation(s) in Exhibit C “are true and correct copies . . . which w[ere] produced by Cross-Complainant in response to discovery requests.” This is adequate authentication. (Landale-Cameron Court, Inc. v. Ahonen (2007) 155 Cal.App.4th 1401, 1409 (“Although a more elaborate authentication could have been presented . . . counsel for the HOA sufficiently authenticated the document[s] when he declared that they were true and correct copies of documents sent by and received from prior counsel for the HOA involved in this litigation.”)) Similarly here, Dorenfeld declared that the citations were true and correct copies of documents received from Johnson during discovery. Dorenfeld declared that the exemption history in Exhibit B is a “true and correct copy” of a printout from the CSLB—this is “not a case . . . where the record is silent as to the authorship of the letters.” (Id.) The objections are OVERRULED.

Summary Judgment

BAIC seeks summary judgment in its favor on Johnson’s Cross-Complaint. BAIC contends that Davani’s $15,000 bond, which was in effect from February 1, 2013 to February 21, 2016, was null and void under its own terms because Davani was not licensed during the relevant period due to failing to obtain workers’ compensation insurance when required. It is undisputed that the “Bond provides that the obligations of BAIC ‘shall be null and void’ in the event that the Principal (Davani and/or Arina) fail to ‘comply with and be subject to the provisions of Division 3, Chapter 9 (commencing with Section 7000) of the Business and Professions Code.’” (UMF no. 5.) It is undisputed that the Bond “states that, ‘This bond shall be deemed continuous in form and shall remain in full force and effect and shall run concurrently with the license period for which licensee is granted and each and every succeeding license period or periods for which said Principal may be licensed, after which liability hereunder shall cease except as to any liability or indebtedness therefore incurred or accrued hereunder.” (UMF no. 6.)

Licensure and Workers’ Compensation Insurance

BAIC argues that Davani was unlicensed because he did not hold workers’ compensation insurance for the period at issue. (Bus. & Prof. Code sec. 7125.2 (“The failure of a licensee to obtain or maintain workers’ compensation insurance coverage, if required under this chapter, shall result in the automatic suspension of the license by operation of law.”)) A “contractor’s license is automatically suspended as of the date the contractor was required to obtain workers’ compensation insurance but did not. This language cannot be clearer.” (Wright v. Issak (2007) 149 Cal.App.4th 1116, 1121.)

The Court requested further briefing on whether notice from the CSLB is required to effectuate an automatic suspension; it appears notice is not required in the case of automatic suspension for failure to obtain insurance. “Under the language of section 7125.2, a contractor whose license is subject to suspension for allowing his or her workers' compensation insurance to lapse is entitled to notice prior to the suspension of his or her license; but a contractor . . . subject to suspension for failing to obtain workers' compensation insurance is subject to automatic suspension without notice.” (Loranger v. Jones (2010) 184 Cal.App.4th 847, 856 (emphasis in original)) It does not appear disputed that this is a “failure to obtain” case rather than an insurance “lapse” case. Therefore, the Court concludes notice to Davani was not required for automatic suspension to be effective.

As evidence that Davani did not hold workers’ compensation, BAIC points to the CSLB’s May 5, 2017 citation against Davani for failing to obtain workers’ compensation insurance. The Court took judicial notice of the citation. Davani did not contest the citation and paid a $3,000 fine. Next, BAIC presents Davani’s deposition testimony that he was cited two other times for failing to obtain workers’ compensation insurance. (Dorenfeld Decl., Ex. A (3/12/19 Davani Depo.)) Davani also testified that he did not maintain workers’ compensation insurance “2014 to 2017.” (Id. at p. 50.) Finally, BAIC presents a record of the periods during which Davani claimed a workers’ compensation exemption. (Dorenfeld Decl., Ex. B.) The Court notes the exemption has a gap between April 17, 2017 and May 19, 2017 and that Davani’s citation was issued during that gap. As evidence that Davani’s license “was active and not otherwise suspended during the relevant time period,” Johnson points to the CSLB’s licensure history for Davani, which “covers the period 01/01/14 to 03/13/17,” two months before Davani was cited. Johnson presents no other evidence.

The moving party must “present[] facts to negate or establish an essential element of each claim at issue” to obtain summary judgment. BAIC has presented facts showing that, in May 2017, Davani was cited for failure to obtain workers’ compensation insurance. BAIC has presented supporting evidence that Davani did not claim a workers’ compensation exemption at the time he was cited (Dorenfeld Decl., Ex. B); moreover, Davani admittedly did not contest that citation. Davani received two other citations within the same “three-to-six month period” as the May 2017 citation. (Davani Depo, p. 65:6:13.) Davani had claimed an exemption from May 20, 2014 to March 28, 2016 and then from March 28, 2016 to April 14, 2017; there is a one-month gap in the exemption between April 14 and May 19, 2017. Davani then claims an exemption from May 19, 2017 to June 18, 2018. (Dorenfeld Decl., Ex. B.) Thus, within six months in either direction of May 5, 2017, Davani’s exemption was ineffective only between April 14 and May 19, 2017. Significantly, it appears Davani contested and appealed both of the other citations that involved failure to obtain workers’ compensation insurance. (Id. at p. 67:21-68:14 (Sadeghi); p. 68:16-69:6 (Khosravi); p. 70:5-7 (confirming appeal in Khosravi and Sadeghi.)) This, combined with the foregoing analysis of Davani’s exemption records, strongly indicates that Davani may have appealed the other citations on the basis that he had an exemption—which was not the case for the May 5, 2017 citation. Davani admitted he did not maintain workers’ compensation insurance 2014 through 2017. (Davani Depo., p. 50.)

Therefore, the Court concludes BAIC has met its initial burden to present facts establishing an essential element of its defense. BAIC’s defense is that the bond is null and void by its own terms if and when Davani becomes unlicensed. The bond provides that BAIC’s obligations “shall be null and void” if Davani fails to “comply with and be subject to . . . Chapter 9 . . . of the Business and Professions Code.” (UMF no. 5.) The bond also provides that it is effective only “concurrently with the license period for which licensee is granted and each and every succeeding license period or periods for which said Principal may be licensed.” (UMF no. 6.) BAIC has presented facts showing that Davani (1) was cited for failing to obtain workers’ compensation insurance in May 2017 and chose not to contest that citation; (2) did not have a workers’ compensation exemption in effect when he was cited; (3) appealed two other citations issued “within a three-to-six month period” for failure to obtain workers’ compensation insurance; and (4) did not obtain workers’ compensation insurance in 2014 through 2017. Under the foregoing provisions, the bond would have voided itself. Thus, the burden shifts to Johnson to “show via specific facts that a triable issue of material fact exists.” It is not clear Johnson has carried this burden; however, for the reasons set forth below, the Court finds BAIC is not entitled to judgment as a matter of law, so the existence of a triable issue of fact is irrelevant.

Initially, the Court was not persuaded that the voiding provision of the bond was consistent with Section 7071.5 and requested supplemental briefing on that point. In relevant part, Section 7071.5 provides that a “contractor’s bond shall be for the benefit” of “[a] homeowner contracting for home improvement upon the homeowner's personal family residence damaged as a result of a violation of this chapter by the licensee” or “[a] person damaged as a result of a willful and deliberate violation of this chapter by the licensee, or by the fraud of the licensee in the execution or performance of a construction contract.” BAIC argues the reference to a “violation . . . by the licensee” impliedly excludes violations by “former” licensees. (Supp. Brief, p. 3 (“This section does not state that a homeowner may be able to collect against a bond for damages caused by a ‘former licensee.’”)) Further, BAIC argues this interpretation is fair because a homeowner has the remedy of disgorgement available against an unlicensed contractor (i.e., a “former licensee”).

The Court agrees in part with BAIC that Johnson has an adequate alternative remedy even if the bond is void—the remedy of disgorgement. Johnson has not shown why a homeowner should be permitted to double dip by recovering both what was paid to the damaging contractor and the contractor’s bond. Further, while the Court is not entirely convinced that the Legislature needed to specify a “former licensee” in Section 7071.5 to provide for recovery against an unlicensed contractor, the Court notes that the statutory definition of “licensee” in Section 7096 expressly does not include an unlicensed contractor. “For purposes of this chapter,” i.e. Chapter 9 of Bus. & Prof. Code (“Contractors”) which includes Section 7071.5, “licensee” is defined as “an individual, partnership, corporation, limited liability company, joint venture, or any combination or organization licensed under this chapter.” (Bus. & Prof. Code sec. 7096.) A suspended contractor is by definition not “licensed under this chapter” and therefore is not a licensee for purposes of Section 7071.5. If the Legislature intended the term “licensee” to include suspended contractors in other parts of Chapter 9, it could have so provided.

However, the purpose of a bond is provide a remedy for homeowners damaged by “a violation of this chapter by the licensee.” The BAIC bond voids itself upon any violation of Bus. & Prof. Code sec. 7000 et seq. by the contractor; in other words, upon any “violation of this chapter,” Chapter 9, by the licensee. The BAIC bond therefore appears to specifically contract around the statutory purpose of a contractor’s bond. The bond is supposed to protect against violations of Chapter 9; that purpose is plainly defeated if the bond voids upon any violation of Chapter 9. It is entirely unclear to the Court when recovery on BAIC’s bond under Section 7071.5 is possible; it appears the homeowner would never be able to recover on such a violation. Thus, while the Court agrees disgorgement is an adequate alternative remedy, BAIC’s bond contradicts the Legislature’s clear statement that a homeowner can recover on the contractor’s bond for violations of Bus. & Prof. Code sec. 7000 et seq.; the Court cannot enforce a provision of a contractor’s bond which is so facially contradictory to the statute providing for such a bond. The Court therefore concludes the bond is not null and void, even assuming that Davani was unlicensed for the relevant period for failure to obtain insurance. As this is the sole basis upon which BAIC seeks summary judgment, BAIC has failed to demonstrate entitlement to judgment as a matter of law, regardless of whether there are triable issues of fact.

CONCLUSION

The Motion for Summary Judgment is DENIED.

Johnson to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LA Court Connect rather than in person in view of the COVID-19 pandemic.

Case Number: BC624204    Hearing Date: October 15, 2020    Dept: 20

Tentative Ruling

Judge David J. Cowan

Department 20


Hearing Date:     Thursday, October 15, 2020

Case Name: Glendale Acceptance v. Yvonne Johnson

Case No.: BC624204

Motion: Summary Judgment

Moving Party: Cross-Defendant Business Alliance Insurance Company

Responding Party: Cross-Complainant Yvonne Johnson

Notice: OK


Ruling: The Motion is CONTINUED to November 11, 2020 at 8:30 a.m. in this Department.

BAIC shall submit its response, if any, at least ten days before the hearing. Johnson shall submit her response, if any, at least five days before the hearing.

BAIC to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LA Court Connect rather than in person in view of the ongoing COVID-19 pandemic.


BACKGROUND

On June 17, 2016, Plaintiff Glendale Acceptance LLC filed a Complaint against Defendant Yvonne Johnson, stating claims for quantum meruit, work, labor and materials, and foreclosure of mechanic’s lien. The claims arose out of a construction project undertaken for Johnson by Plaintiff’s assignor, contractor Arina Builders, for which Johnson allegedly did not pay.

On April 19, 2017, Johnson filed a Cross-Complaint against Jeff Davani, an individual dba Arina Builders; Glendale Acceptance LLC; State National Insurance Company, Inc.; Business Alliance Insurance Company (“BAIC”); and Roes 1-50, stating claims for negligence, breach of contract, fraud, breach of fiduciary duty, constructive fraud, disgorgement against unlicensed contractor, recovery on contractor's license bond, tortious interference with contract, implied equitable indemnity, and seeking declaratory relief.

On April 27, 2017, Johnson filed a First Amended Cross-Complaint stating the same claims against the same parties.

On August 10, 2017, Johnson filed a Second Amended Cross-Complaint (“SACC”) against Davani (dba Arina Builders); Glendale Acceptance LLC; BAIC; and Roes 1-50, stating the same claims with an additional slander of title claim. Johnson seeks to recover against BAIC on the contractor’s bond it issued to Davani. Separately, Johnson seeks disgorgement of funds paid to Davani on the ground that Davani is unlicensed for failing to obtain workers’ compensation insurance for all the employees on the construction project.

On May 29, 2020, BAIC moved for summary judgment on Johnson’s contractor’s bond crossclaim in the SACC on the ground that the bond was null and void when Davani’s license was automatically suspended for not obtaining workers’ compensation insurance when required.

On September 29, 2020, Johnson filed an Opposition.

On October 9, 2020, BAIC filed a Reply.

DISCUSSION

The Court has reviewed the Motion, Opposition, Reply, and supporting evidence—as well as Johnson’s evidentiary objections to BAIC’s evidence. The Court has the following concerns, on which further input is required:

1. Is Bus. & Prof. Code sec. 7071.5 consistent with that provision of the Bond which causes it to automatically void upon violations of Bus. & Prof. Code sec. 7000 et seq.? Section 7071.5 provides that a contractor’s bond is for the benefit of a homeowner “damaged as a result of a violation of this chapter by the licensee.” The Bond appears to state the opposite—that a homeowner cannot recover if there is “a violation of this chapter by the licensee.”

2. Further, if this automatic voiding provision is consistent with Section 7071.5, is the result equitable for the homeowner? On BAIC’s automatic suspension theory under Bus. & Prof. Code sec. 7125.2, there appears to be no requirement to give notice to the contractor or homeowner that the bond is invalid.

a. As a secondary question: Do the automatic suspension provisions of Section 7125.2 require notice of license suspension from the CSLB or is suspension effective notwithstanding lack of notice to the licensee?

3. When did the construction project finish? In her Opposition, Johnson states that the project started in 2015 and continued “through an undetermined date.” The (rough) date on which the project ended appears relevant in assessing whether the CSLB citation is adequate evidence to find automatic license suspension. If Davani was cited after the project ended, it is unclear that this would cause the bond to void as to Johnson if Davani’s license was in effect for the duration of the project. Further, the duration of the project is presumably within Johnson’s knowledge as the homeowner.

4. What authentication is required for the CSLB citation (if any)? Does the CSLB citation constitute inadmissible hearsay?

5. What authentication is required for the CSLB exemption history (if any)? Does the CSLB exemption history constitute inadmissible hearsay?

a. As a secondary question: Does Evid. Code sec. 1280 et seq. require special authentication for official acts or records such as these, e.g., an official seal or declaration from custodian of records?

The Court requests further input from the parties on these points. Therefore, the Motion is CONTINUED to November 11, 2020 at 8:30 a.m. in this Department.

BAIC shall submit its response, if any, at least ten days before the hearing. Johnson shall submit her response, if any, at least five days before the hearing.

BAIC to give notice.

If counsel do not submit on the tentative, they are strongly encouraged to appear by LA Court Connect rather than in person in view of the ongoing COVID-19 pandemic.

Case Number: BC624204    Hearing Date: January 29, 2020    Dept: 20

Tentative Ruling

Judge Dalila C. Lyons

Department 20


Hearing Date: Wednesday, January 29, 2020

Case Name: Glendale Acceptance, LLC v. Yvonne Johnson

Case No.: BC624204

Motion: Tax Costs

Moving Party: Plaintiff Glendale Acceptance, LLC

Responding Party: Defendant/Cross-Complainant Yvonne Johnson

Notice: DEFECTIVE


Ruling: Plaintiff Glendale Acceptance, LLC’s motion to tax Defendant/Cross-Complainant Yvonne Johnson’s costs is DENIED.

Moving Party shall give notice.


On August 20, 2019, Plaintiff dismissed without prejudice the Complaint against Defendant. On August 23, 2019, Defendant filed a memorandum of costs. On September 13, 2019, Plaintiff filed the present motion to tax costs.

Plaintiff moves to strike all six items from Defendant’s memorandum of costs because those costs were not incurred to defend against the Complaint, rather to prosecute Defendant’s cross-complaints. Because there has been no prevailing party determined on the SECOND Amended Cross Complaint (SAXC), Defendant cannot recover the claimed costs from Plaintiff.

Defendant opposes the motion to strike because the motion to strike was filed more than 15 days after the memorandum of costs was served. Also, the notice of the hearing on the motion to strike gave the original hearing date as December 2, 2019, when the original hearing was December 3, 2019. Finally, Defendant reframes the costs incurred in prosecuting her SAXC as necessary to defend against the Complaint because those costs were necessary to show Defendant was not liable to Plaintiff, since Plaintiff’s Assignor had an invalid claim against Defendant.

ANALYSIS

I. Procedural Defects

A. Time Limit for Contesting Costs

California Rules of Court, Rule 3.1700, provides that: “A prevailing party who claims costs must serve and file a memorandum of costs within 15 days after the date of mailing of the notice of entry of judgment or dismissal by the clerk under Code of Civil Procedure section 664.5 or the date of service of written notice of entry of judgment or dismissal, or within 180 days after entry of judgment, whichever is first. The memorandum of costs must be verified by a statement of the party, attorney, or agent that to the best of his or her knowledge the items of cost are correct and were necessarily incurred in the case.” CRC 3.1700(a).

Here, dismissal was entered and mailed on August 20, 2019. Defendant filed a memorandum of costs on August 23, 2019. Defendant timely sought costs.

California Rules of Court, Rule 3.1700, also provides that: “any notice of motion to strike or tax costs must be served and filed 15 days after service of the cost memorandum. If the cost memorandum was served by mail, the period is extended as provided in Code of Civil Procedure section 1013.” CRC 3.1700(b)(1). Code of Civil Procedure section 1013 states service by mail extends the notice period by five days if the place of mailing and the place of address are within California. CCP § 1013(a).

Here, Defendant served the memorandum of costs by mail on August 23, 2019, from Simi Valley, California, to Beverly Hills, California. Thus, Plaintiff received notice of the memorandum of costs on August 28, 2019. Therefore, Plaintiff had until September 12, 2019, to file and serve a notice of motion to tax costs. Plaintiff filed and served the present motion to tax costs on September 13, 2019, one day late. Accordingly, Plaintiff’s motion is barred by California Rule of Court, Rule 3.1700(b)(1).

“The party claiming costs and the party contesting costs may agree to extend the time for serving and filing the cost memorandum and a motion to strike or tax costs. This agreement must be confirmed in writing, specify the extended date for service and be filed with the clerk. In the absence of an agreement, the court may extend the times for serving and filing the cost memorandum or the notice of motion to strike or tax costs for a period not to exceed 30 days.” CRC 3.1700(b)(3).

Here, the Court will not exercise its discretion to allow Plaintiff’s motion because Plaintiff’s motion fails for the substantive reasons discussed below as well as the procedural reason discussed above.[1]

II. Prevailing Party

A “prevailing party” entitled to costs: In general, the “prevailing party” is entitled as a matter of right to recover costs for suit in any action or proceeding. CCP § 1032(b); Santisas v. Goodin (1998) 17 Cal.4th 599, 606; Scott Co. of Calif. v. Blount, Inc. (1999) 20 Cal.4th 1103, 1108. Assuming the “prevailing party” requirements are met, the trial court has no discretion to order each party to bear his or her own costs of suit. Michell v. Olick (1996) 49 Cal.App.4th 1194, 1198; Nelson v. Anderson (1999) 72 Cal.App.4th 111, 129. The term “prevailing party” for costs purposes is defined by statute to include:

C The party with a net monetary recovery;

C A defendant who is dismissed from the action;

C A defendant where neither plaintiff nor defendant recovers anything; and

C A defendant as against those plaintiffs who do not recover any relief against that defendant. (CCP § 1032(a)(4).)

If the party does not fall within one of these four express categories, the court may exercise its discretion to award or deny costs. See Lincoln v. Schurgin (1995) 39 Cal.App.4th 100, 105.

Here, it is undisputed that Plaintiff dismissed Defendant from this action on August 20, 2019. Under CCP § 1032(a)(4), Defendant is a prevailing party entitled to recover costs from Plaintiff only.

III. Costs: Items and Amounts

“If the items appearing in a cost bill appear to be proper charges, the burden is on the party seeking to tax costs to show that they were not reasonable or necessary.” Ladas v. California State Auto. Assn. (1993) 19 Cal.App.4th 761, 774. “On the other hand, if the items are properly objected to, they are put in issue and the burden of proof is on the party claiming them as costs.” Ibid.

CCP § 1033.5 provides the items that are allowable as costs under CCP § 1032. The losing party may dispute any or all of the items in the prevailing party’s memorandum of costs by a motion to strike or tax costs. CRC Rule 3.1700(b). Technically, a motion to strike challenges the entire costs bill whereas a motion to tax challenges particular items or amounts.

Here, Plaintiff challenges all six items of Defendant’s costs arguing Defendant incurred those costs prosecuting Defendant’s SAXC rather than defending against Plaintiff’s Complaint. Defendant is the prevailing party on the Complaint only, so Defendant should not be allowed to recover the listed costs. Defendant retorts that the costs were necessary to defend against the Complaint’s assertion of a mechanic’s lien and claims for non-payment by deposing the general contractor, Jeff Davani.

The Court agrees with Defendant that the costs were reasonable and necessary to not only prosecute Defendant’s SAXC but also defend against the Complaint because the factual issues significantly overlap between the Complaint and the SAXC. Plaintiff sued Defendant on a mechanic’s lien and claims for non-payment of plumbing work on Defendant’s house, which causes of action were assigned to Plaintiff by Arina Builders. Defendant’s SAXC alleges Jeff Davani d/b/a Arina Builders poorly performed the plumbing work on Defendant’s house. Therefore, the factual issues surrounding the plumbing work done at Defendant’s house are highly relevant to both the Complaint and the SAXC. Because these facts apply to both the Complaint and the SAXC, any costs incurred to establish these facts would also apply to both the Complaint and the SAXC. Therefore, Defendant’s costs were incurred in the action in which Defendant is the prevailing party.

Further, it is doubtful that Plaintiff would have dismissed the Complaint if Defendant had not incurred costs to establish the claims assigned to Plaintiff by Cross-Defendant Jeff Davani d/b/a Arin Builders were not as valid as they first appeared. Plaintiff raises no other arguments against Defendant’s costs.

Accordingly, Plaintiff’s motion to tax/strike costs is DENIED.


[1] Defendant also argues that notice of the original hearing was improper because Plaintiff’s Notice listed the wrong date for the original hearing. The Court need not address that argument because the hearing has been rescheduled and the Court itself gave proper notice of the rescheduled hearing. Defendant has suffered no prejudice.

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