Tentative Rulings

Case Number: BC616313    Hearing Date: March 05, 2021    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiffs Onesimo Benitez Hernandez (“Hernandez”) and Maricela Benitez (jointly, “Plaintiffs”) filed this personal injury action on April 8, 2016. This action arises from injuries sustained by Hernandez when he was allegedly struck by a dumpster or container that was pushed into him by a tractor-trailer backing up into the loading dock of a Food 4 Less store near where Hernandez was working. The tractor-trailer was allegedly being driven and operated by Rodolfo Trujillo (“Trujillo”).

In the Complaint, Plaintiffs named The Kroger Co., (“Kroger”), Ralphs Grocery Company (“Ralphs”), Food 4 Less Holdings, Inc., and Food 4 Less of Southern California as defendants. These defendants were alleged to have owned and operated the tractor-trailer and employed the driver of the tractor-trailer.

On July 6, 2016, Alpha Beta filed an Answer to the Complaint, noting that it had been incorrectly named and served as Food 4 Less of Southern California. On October 18, 2016, Plaintiffs dismissed without prejudice Kroger, Ralphs, and Food 4 Less Holdings, Inc.

On November 8, 2017, Alpha Beta filed a Cross-Complaint for declaratory relief and indemnification against Cross-Defendants Doo-Rite Painting, Inc. (“Doo-Rite”) and FP Contracting Inc. (“FP”). At the time of the incident, Hernandez was employed by Doo-Rite, which itself was subcontracted by FP to provide painting services at the Food 4 Less store.

On April 11, 2018, Alpha Beta filed the operative First Amended Cross-Complaint (“FACC”) against FP and Doo-Rite, asserting causes of action for (1) breach of contract – third party beneficiary, (2) express indemnity, (3) equitable indemnity, (4) apportionment of fault, and (5) declaratory relief. On August 5, 2020, the Court granted FP’s motion for summary judgment as to Alpha Beta’s FACC.

On September 28, 2020, the Court granted Ralphs, Kroger, and Kroger Dedicated Logistics Co. (“Kroger Logistics”) (collectively, the “Kroger Parties”) leave to file a Cross-Complaint against FP for express indemnity and breach of contract. The Kroger Parties’ Cross-Complaint was filed on October 1, 2020.

FP now demurs to the Kroger Parties’ Cross-Complaint. The Kroger Parties oppose.

Request for Judicial Notice

The Court grants the Kroger Parties’ request for judicial notice.

Discussion

A demurrer can be used only to challenge defects that appear on the face of the pleading under attack or from matters outside the pleading that are judicially noticeable. ((Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) “To survive a demurrer, the complaint need only allege facts sufficient to state a cause of action; each evidentiary fact that might eventually form part of the plaintiff's proof need not be alleged.” ((C.A. v. William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872.) For the purpose of testing the sufficiency of the cause of action, the demurrer admits the truth of all material facts properly pleaded. ((Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 966-967.) A demurrer “does not admit contentions, deductions or conclusions of fact or law.” ((Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695, 713.)

In the Kroger Parties’ Cross-Complaint, the Kroger Parties allege that on March 21, 2014, they entered into a contract with FP whereby FP would perform a remodel of a Food 4 Less store in Los Angeles (the “Contract”). (Cross-Compl., ¶ 11.) Hernandez was hired by FP as a subcontractor to perform painting services in connection with the remodel and was engaged in such work when he was injured. (Cross-Compl., ¶ 12.) The Kroger Parties allege that pursuant to the Contract (Cross-Compl., Ex. 1), along with the General Conditions (Cross-Compl., Ex. 2), FP was expressly required to indemnify, hold harmless, and defend the Kroger Parties as a result of Hernandez’s injuries. (Cross-Compl., ¶¶ 13, 17.)

FP contends that both causes of action must fail as to Kroger and Kroger Logistics because neither is a party to the Contract or the General Conditions. As set forth in the Contract, the parties to the Contract are FP (defined as the “Contractor”) and Ralphs Grocery Company, dba Food 4 Less (defined as the “Owner”). (Cross-Compl., Ex. 1, p. 1.) The Contract identifies a number of documents that form the contract, including the “General Conditions of the Contract.” (Cross-Compl., Ex. 1, p. 1.) The General Conditions identify its parties as “Contractor” and “Owner.” “Contractor” is defined as “[t]he person or entity identified as such in the Agreement . . .” and means “the Contractor or the Contractor’s authorized representative.” (Cross-Compl., Ex. 2, § 1.1.1.12.) “Owner” is defined as “[t]he person or entity identified as such in the Agreement . . . and means “ ” (Cross-Compl., Ex. 2, § 1.1.1.11.) FP asserts that neither Kroger nor Kroger Logistics is defined in the contract documents as an “Owner” and neither Kroger nor Kroger Logistics is alleged to be a “Project Manager” as defined in the General Conditions. Therefore, FP argues that there is no contract or indemnity provision with Kroger or Kroger Logistics that can be breached.

The Kroger Parties counter that the General Conditions expressly require FP to have insurance with Ralphs and its subsidiaries as additional insureds. The Kroger Parties argue that there is no reason to do that unless it is understood by all that Ralphs and its subsidiaries have an interest in the contract of which the General Conditions is a part. But as noted by FP, the indemnity clause is in favor of the “owner” and does not include subsidiaries, affiliates, or related entities. The fact that the subsidiaries were included as additional insureds does not change the clear language of the indemnity provision.

Next, FP argues that none of the cross-complainants are defendants in this action, and so any claim for express indemnity or breach of contract is moot. FP points out that the Kroger Parties have been dismissed without prejudice by Plaintiffs, and therefore, they have expended no costs or fees in the defense of Plaintiffs’ lawsuit. The Kroger Parties counter that it would be premature to rule that they have not been harmed because there is a potential for damages. The Kroger Parties point out that FP filed a cross-complaint against the Kroger Parties for indemnity. The Kroger Parties also argue that they incurred fees and expenses while originally named by Plaintiffs and continue to incur fees and expenses defending against FP’s cross-complaint. The Kroger Parties argue that the indemnity provision is broad enough to encompass these expenses, because it covers “all loss, claims, suits, damages…expenses and attorney’s fees arising out of bodily injury, sickness, disease or death…arising out of or encountered in connection with the construction of the Project.” FP does not respond to this argument. In any event, the Court finds that this argument has merit for purposes of demurrer.

Lastly, FP argues that the statute of frauds precludes the Kroger Parties from receiving indemnity or defense pursuant to the General Conditions. FP points out that the Contract does not contain an indemnity clause, only the General Conditions do. FP also points out that the General Conditions are not signed and the General Conditions do not expressly identify FP as the “Contractor.” “The statute of frauds requires any contract subject to its provisions to be memorialized in a writing subscribed by the party to be charged or by the party’s agent.” ((Rossberg v. Bank of America, N.A. (2013) 219 Cal.App.4th 1481, 1503.) Pursuant to Civil Code section 1624, subdivision (a)(2), a “special promise to answer for the debt, default, or miscarriage of another” is subject to the writing and subscription requirement. The Kroger Parties correctly counter that the Contract expressly incorporates the General Conditions as part of the Contract, and no separate signature is required on documents that are incorporated by reference so long as the contract itself is signed. ((See Harrison v. California State Auto. Assn. Inter-Ins. Bureau (1976) 56 Cal.App.3d 657, 664-665 [noting that the failure to sign a cover sheet or endorsement for an insurance policy did not render the terms on the cover sheet or endorsement ineffective].)

Conclusion

For the reasons set forth above, the Court sustains FP’s demurrer to the Cross-Complaint of the Kroger Parties as to Kroger and Kroger Logistics, without leave to amend. FP has not proffered any proposed amendment. The Court otherwise overrules FP’s demurrer.

The Court orders FP to file and serve an answer within 10 days of the date of this order.

FP is ordered to give notice of this ruling.

DATED: March 5, 2021 ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court

Case Number: BC616313    Hearing Date: September 28, 2020    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiffs Onesimo Benitez Hernandez (“Hernandez”) and Maricela Benitez (jointly, “Plaintiffs”) filed this personal injury action on April 8, 2016. This action arises from injuries sustained by Hernandez when he was allegedly struck by a dumpster or container that was pushed into him by a tractor-trailer backing up into the loading dock of a Food 4 Less store near where Hernandez was working. The tractor-trailer was allegedly being driven and operated by Rodolfo Trujillo (“Trujillo”).

In the Complaint, Plaintiffs named The Kroger Co., (“Kroger”), Ralphs Grocery Company (“Ralphs”), Food 4 Less Holdings, Inc., and Food 4 Less of Southern California as defendants. These defendants were alleged to have owned and operated the tractor-trailer and employed the driver of the tractor-trailer.

On July 6, 2016, Alpha Beta filed an Answer to the Complaint, noting that it had been incorrectly named and served as Food 4 Less of Southern California. On October 18, 2016, Plaintiffs dismissed without prejudice Kroger, Ralphs, and Food 4 Less Holdings, Inc.

On November 8, 2017, Alpha Beta filed a Cross-Complaint for declaratory relief and indemnification against Cross-Defendants Doo-Rite Painting, Inc. (“Doo-Rite”) and FP Contracting Inc. (“FP”). At the time of the incident, Hernandez was employed by Doo-Rite, which itself was subcontracted by FP to provide painting services at the Food 4 Less store.

On April 11, 2018, Alpha Beta filed the operative First Amended Cross-Complaint (“FACC”) against FP and Doo-Rite, asserting causes of action for (1) breach of contract – third party beneficiary, (2) express indemnity, (3) equitable indemnity, (4) apportionment of fault, and (5) declaratory relief.

On January 16, 2018, FP filed a Cross-Complaint against Doo-Rite and Alpha Beta. The operative Second Amended Cross-Complaint (“SACC”) was filed on August 1, 2019, asserting claims for (1) equitable indemnity, (2) express indemnity, (3) equitable contribution, (4) breach of contract, and (5) declaratory relief against Alpha Beta, Doo-Rite, Ralphs, Kroger, and Kroger Dedicated Logistics Co. (“Kroger Logistics”). On July 12, 2019, FP dismissed the first and third causes of action (for equitable indemnity and equitable contribution).

During the course of this litigation, counsel for Alpha Beta informed the parties and the Court that a mistake had been made. Alpha Beta had originally responded to Plaintiffs’ Complaint because the incident occurred at a Food 4 Less store. Evidently, Trujillo was not employed by Alpha Beta, and the tractor-trailer driven by Trujillo was not owned by Alpha Beta. Rather, Trujillo was employed by Ralphs, and the tractor-trailer was owned by Ralphs. However, the Court denied Alpha Beta’s motion for leave to amend all of its pleadings to substitute Ralphs as the correct responding party on October 1, 2019, encouraging the parties to informally reach an agreement regarding Ralphs’s entry into the case (and Alpha Beta’s exit from the case). It does not appear that such an agreement has been made.

On August 5, 2020, the Court granted FP’s motion for summary judgment as to Alpha Beta’s FACC. On August 10, 2020, the Court granted Doo-Rite’s motion for summary judgment as to Alpha Beta’s FACC.

There are now two motions before the Court. The first is Doo-Rite’s motion for an award of defense costs (i.e., attorney fees and costs) against Alpha Beta pursuant to Code of Civil Procedure section 1038. Alpha Beta opposes the motion. The second is the motion by Ralphs, Kroger, and Kroger Logistics for leave to file a Cross-Complaint against FP for express indemnity and breach of contract. FP opposes that motion.

Doo-Rite’s Motion for Fees and Costs

Discussion

Code of Civil Procedure section 1038, subdivision (a) provides as follows:

“In any civil proceeding under the Government Claims Act . . . or for express or implied indemnity or for contribution in any civil action, the court, upon motion of the defendant or cross-defendant, shall, at the time of the granting of any summary judgment, . . . determine whether or not the plaintiff, petitioner, cross-complainant, or intervenor brought the proceeding with reasonable cause and in the good faith belief that there was a justifiable controversy under the facts and law which warranted the filing of the complaint, petition, cross-complaint, or complaint or answer in intervention. If the court should determine that the proceeding was not brought in good faith and with reasonable cause, an additional issue shall be decided as to the defense costs reasonably and necessarily incurred by the party or parties opposing the proceeding, and the court shall render judgment in favor of that party in the amount of all reasonable and necessary defense costs, in addition to those costs normally awarded to the prevailing party. An award of defense costs under this section shall not be made except on notice contained in a party's papers and an opportunity to be heard.”

“Defense costs” include “reasonable attorney’s fees, expert witness fees, the expense of services of experts, advisers, and consultants in defense of the proceeding, and where reasonably and necessarily incurred in defending the proceeding.” (Code Civ. Proc., § 1038, subd. (b).)

As an initial matter, the Court notes that Alpha Beta contends that section 1038 applies only to cases proceeding under the Government Claims Act, and therefore, it applies only to cases involving public entities. The Court finds that a plain reading of the statute does not support this interpretation. Section 1038 clearly applies to two types of cases: (1) any civil proceedings under the Government Claims Act, and (2) any civil proceedings for express or implied indemnity or for contribution in any civil action. This interpretation is also supported by established case law. (See, e.g., Suarez v. City of Corona (2014) 229 Cal.App.4th 325, 332 [“Section 1038 ‘provides public entities . . . and other specified defendants with a way to recover the costs of defending against unmeritorious and frivolous litigation.” (emphasis added)]; Ford Motor Co. v. Schultz (1983) 147 Cal.App.3d 941, 951 [in a case not involving a public entity, holding that granting of a section 1038 motion requires “a finding [that] a cross-complaint for indemnity was brought without reasonable cause and a good faith belief there was a justiciable controversy under the facts and law which warranted the filing of the cross-complaint”]; Crib Retaining Walls, Inc. v. NBS/Lowry, Inc. (1996) 47 Cal.App.4th 886, 891 [Section 1038 provides that “when a party named as a cross-defendant in a cross-complaint seeking express or implied indemnity obtains dismissal of the cross-complaint by certain summary methods (e.g., summary judgment motion, nonsuit, directed verdict or motion under § 631.8), the cross-defendant may be entitled to recover a broad category of otherwise nonrecoverable costs.”]; Gonzales v. ABC Happy Realty (1997) 52 Cal.App.4th 391, 392 [Section 1038 “directs a trial court to assess costs against a party who has brought a proceeding for indemnity or contribution without good faith or reasonable cause.”].)

Doo-Rite contends that Alpha Beta lacked reasonable cause and good faith in bringing its cross-claims (for breach of contract, express indemnity, equitable indemnity, apportionment of fault, and declaratory relief) against Doo-Rite.

Section 1038 “indicates plaintiffs must not only bring (or maintain) their action ‘with reasonable cause,’ but must also bring (or maintain) it ‘in the good faith belief that there [is] a justifiable controversy under the facts and law.’” (Kobzoff v. Los Angeles County Harbor/UCLA Medical Center (1998) 19 Cal.4th 851, 861.) “Thus, before denying a section 1038 motion, a court must find the plaintiff brought or maintained an action in the good faith belief in the action’s justifiability and with objective reasonable cause.” (Id. at p. 862.)

“’Reasonable cause’ is an objective standard which asks whether any reasonable attorney would have thought the claim tenable.” (Suarez v. City of Corona, supra, 229 Cal.App.4th at p. 336.) “Good faith, or its absence, involves a factual inquiry into the plaintiff’s subjective state of mind [citations]: Did he or she believe the action was valid? What was his or her intent or purpose in pursuing it?” (Hall v. Regents of University of California (1996) 43 Cal.App.4th 1580, 1586 [emphasis in original].)

Doo-Rite contends that before Alpha Beta filed its original Cross-Complaint, Alpha Beta knew that workers’ compensation exclusivity barred its noncontract claims against Doo-Rite, pursuant to Labor Code section 3864[1]. First, Doo-Rite points out that Alpha Beta knew that Hernandez was acting in the course and scope of his employment prior to filing its Cross-Complaint against Doo-Rite because Alpha Beta had deposed Hernandez on two occasions prior to filing the Cross-Complaint. (Bennion Decl., ¶ 23.) By the time Doo-Rite had filed its motion for summary judgment, it was undisputed that Hernandez was acting in the course and scope of his employment at the time of the incident. (Bennion, ¶ 18, Ex. 17, Fact No. 20.) Second, Doo-Rite points to the fact that on the day Doo-Rite first appeared in this case, Alpha Beta served requests for admission to Doo-Rite which attached Doo-Rite’s certificate of liability insurance. (Bannion Decl., ¶ 9, Ex. 8.) The certificate of liability insurance lists NorGuard Insurance as an insurer for “workers compensation and employers’ liability insurance,” as well as a policy number and the dates the policy was in effect. (Bannion Decl., ¶ 8, Ex. 7.) Later, on July 13, 2018, Doo-Rite produced documents from NorGuard Insurance Company confirming that it had active workers’ compensation insurance covering Hernandez’s injuries at the time of the incident. (Bannion Decl., ¶ 10, Ex. 9.)

Alpha Beta counters that there was a disputed issue as to the applicability of workers’ compensation exclusivity to this case. Alpha Beta contends that because there was evidence that although Doo-Rite’s owner, David Kim, maintained workers’ compensation insurance, when Hernandez was injured, Mr. Kim paid Hernandez a few hundred dollars cash instead of filing a workers’ compensation claim. (Naples Decl., ¶ 4, Ex. A.) Alpha Beta argues that the exclusive remedy of workers’ compensation is not available if an employer “does not carry insurance or has not otherwise secured the payment of compensation.” (Le Parc Community Assn. v. Workers' Comp. Appeals Bd. (2003) 110 Cal.App.4th 1161, 1172.) Although Alpha Beta does not go on to provide citations for what it means to otherwise secure the payment of compensation, the Court notes that Alpha Beta cites to Lee v. Cranford (1951) 107 Cal.App.2d 677, 678 for the proposition that where an employer had workers’ compensation insurance and it “failed to cover” an injured employee, the employer could be directly sued. Alpha Beta also cites to Coffin v. Bloodworth (1938) 28 Cal.App.2d 522, wherein an employer that did not have workers’ compensation insurance paid the injured employee’s medical bills as a result of the accident and used that payment to argue that workers’ compensation had been secured. (Id. at p. 523.) The Court of Appeal disagreed, noting that the workers’ compensation laws requires that compensation be secured “before a contingency arises that requires the payment of such compensation and not . . . the actual payment thereof.” (Id. at p. 524.) Thus, Coffin has little application to the instant case because it is undisputed that Doo-Rite had “secured” workers’ compensation insurance prior to Hernandez’s accident. The question is whether Doo-Rite’s failure to actually utilize the insurance affects the application of the exclusivity rule. Based on the facts presented, the Court finds that Alpha Beta had reasonable cause to pursue its noncontract claims despite Doo-Rite’s claim that workers’ compensation exclusivity applied. Further, the Court finds that there is no evidence that Alpha Beta did not have a subjective good faith belief in the justifiability of its noncontract claims.

As for the contract claims (and specifically, the express indemnity claim), Alpha Beta alleged in its FACC that it was expressly intended to benefit from the indemnity provision in Doo-Rite’s subcontract with FP because the subcontract expressly referred to “Owner” as a covered party.[2] Alpha Beta took the position that it was “Owner.” Doo-Rite argues that Alpha Beta’s assertion that it was “Owner” and thus entitled to the benefits of the indemnity provision was and is untenable. Doo-Rite argues that the subject subcontract never defined “Owner” and that the closest reference to the identity of “Owner” was contained in the Prime Contract between FP (the contractor on the Food 4 Less store project) and Ralphs Grocery Company dba Food 4 Less. Thus, to the extent that “Owner” is defined, it had only ever been defined as Ralphs, not Alpha Beta. (Bannion Decl., ¶ 7, Ex. 6.)

The Court notes here the confusion and lack of clarity regarding the Alpha Beta/Ralphs issue. Alpha Beta/Ralphs have variously taken the position that they were the correct entity to be sued in this case (i.e., Trujillo’s employer). Alpha Beta contends that because both entities do business as Food 4 Less, they are essentially interchangeable. Alpha Beta further contends that they have actively been attempting to correct their mistake since it became clear to them that Ralphs was the correct entity. In any event, the Court notes that there is no disagreement that Alpha Beta always took the position that it was a third-party beneficiary to the subcontract. Such a third party “need not be named or identified individually to be an express beneficiary.” (Kaiser Eng'rs v. Grinnell Fire Prot. Sys. Co. (1985) 173 Cal.App.3d 1050, 1055.) It is further undisputed that because “Owner” is not defined in the subcontract, it is ambiguous as to who was actually intended to benefit from the indemnity provision. Based on this ambiguity, the Court finds that Alpha Beta had reasonable cause to pursue its contract-based claims against Doo-Rite. Further, the Court finds that there is no evidence that Alpha Beta did not have a subjective good faith belief in the justifiability of these claims.

Conclusion

Accordingly, the Court denies Doo-Rite’s motion for fees and costs pursuant to Code of Civil Procedure section 1038.

Alpha Beta is ordered to give notice of this ruling.

Ralphs, Kroger, and Kroger Logistics’ Motion for Leave to File Cross-Complaint

Discussion

Where a defendant wishes to assert a “related cause of action” against plaintiff, it must do so in a cross-complaint. Failure to plead it will bar defendant from asserting it in a later lawsuit. (Code Civ. Proc., § 426.30; Code Civ. Proc., § 426.10 [“‘Related cause of action’ means a cause of action which arises out of the same transaction, occurrence, or series of transactions or occurrences as the cause of action which the plaintiff alleges in his complaint.”].)

A cross-complaint against a plaintiff may be filed as a matter of right if it is filed before or at the same time as the answer. (Code Civ. Proc., § 428.50, subd. (a).) Otherwise, leave of court must be obtained. (Code Civ. Proc., § 428.50, subd. (c).)

Code of Civil Procedure section 426.50 provides the standard for granting leave to amend where a cross-complaint is related to the underlying complaint. That section provides:

“A party who fails to plead a cause of action subject to the requirements of this article, whether through oversight, inadvertence, mistake, neglect, or other cause, may apply to the court for leave to amend his pleading, or to file a cross-complaint, to assert such cause at any time during the course of the action. The court, after notice to the adverse party, shall grant, upon such terms as may be just to the parties, leave to amend the pleading, or to file the cross-complaint, to assert such cause if the party who failed to plead the cause acted in good faith. This subdivision shall be liberally construed to avoid forfeiture of causes of action.” (Code Civ. Proc., § 426.50.)

Courts have interpreted this section to require that a motion to file a cross-complaint be granted at any time during the course of the action unless bad faith of the moving party is demonstrated. (Silver Orgs. v. Frank (1990) 217 Cal.App.3d 94, 98-99 [“Factors such as oversight, inadvertence, neglect, mistake or other cause, are insufficient grounds to deny the motion unless accompanied by bad faith.”]; Sidney v. Superior Court (1988) 198 Cal.App.3d 710, 718 [a “strong showing of bad faith” is required].)

Ralphs, Kroger, and Kroger Logistics (collectively, the “Kroger Parties”) move for leave to file a cross-complaint against FP to assert causes of action for breach of contract and express indemnity. The Kroger Parties assert that on August 25, 2020, their counsel discovered and came into possession of the General Conditions, a separate document specifically incorporated and included in the Executed Agreement between FP and Ralphs. (Naples Decl., ¶ 10.) The Executed Agreement relates to the construction project at the Food 4 Less store where Hernandez was injured. The General Conditions contain an indemnification provision requiring FP to indemnify the Kroger Parties, and it is pursuant to that provision that the Kroger Parties assert their claims for breach of contract and express indemnity. The Kroger Parties also assert that there is no bad faith on their part in bringing the proposed cross-complaint. The Kroger Parties contend that they served notices of depositions of Ron Folka and the Person Most Knowledgeable Regarding the Contract between Ralphs and FP in March 2019. (Naples Decl., ¶ 15.) Mr. Folka was the president of FP and signed the subject contract. (Naples Decl., ¶ 15.) Due to circumstances outside of their control, the depositions have not taken place. (Naples Decl., ¶ 16.) The Kroger Parties contend that if Mr. Folka had been deposed as originally scheduled, the information concerning the General Conditions would have been discovered sooner.

FP argues that there is no basis for a claim for express indemnity or breach of contract by the Kroger Parties for a number of reasons. First, FP argues that the General Conditions attached to the proposed cross-complaint is dated 2018, and the Executed Agreement is dated 2014, so the General Conditions could not possibly apply. In reply, counsel for the Kroger Parties states that she mistakenly included the 2018 General Conditions instead of the 2013 General Conditions, and the 2013 version is attached to her reply declaration. (Naples Decl.-Reply, ¶ 3.) The Kroger Parties contend that the indemnity language of both versions is the same. (Guth Decl., ¶ 5, Ex. B.) Next, FP argues that the General Conditions do not identify FP expressly. But as noted by the Kroger Parties, the General Conditions are expressly incorporated in the Executed Agreement. (Naples Decl., ¶ 3, Ex. A (Prop. Cross-Compl.), Ex. 1, § 1.) Finally, FP argues that the Kroger Parties are not defendants in Hernandez’s operative complaint – the only defendant remaining in Hernandez’s lawsuit is Alpha Beta. Thus, the Kroger Parties have not incurred any costs to defend the main action and have no damages. Nevertheless, these arguments go to the substance of the Kroger Parties’ proposed claims. FP has not otherwise argued or demonstrated that the Kroger Parties acted in bad faith in seeking to bring this cross-complaint. FP argues that the Kroger Parties have delayed, but counsel for the Kroger Parties has already attested to the fact that she did not discover the General Conditions until August 2020, and that the failure to discover the General Conditions earlier was due to her mistake.

Again, the Court notes that the confusion between Ralphs and Alpha Beta has still not been resolved. By now, after more than a year’s worth of law and motion and discovery, it should be clear to all the parties that it is in all of their interests for there to no longer be any confusion as to which parties should remain in this case. Accordingly, the Court again strongly encourages the parties to informally resolve the problem so that future law and motion is not unnecessarily complicated.

Conclusion

Based on the foregoing, the Kroger Parties’ motion for leave to file a cross-complaint is granted. The Court orders the Kroger Parties to file and serve the Cross-Complaint within three days of the date of this order.

The Kroger Parties are ordered to give notice of this ruling.

DATED: September 28, 2020 ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court

Case Number: BC616313    Hearing Date: August 27, 2020    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiffs Onesimo Benitez Hernandez (“Hernandez”) and Maricela Benitez (jointly, “Plaintiffs”) filed this personal injury action on April 8, 2016. This action arises from injuries sustained by Hernandez when he was allegedly struck by a dumpster or container that was pushed into him by a tractor-trailer backing up into the loading dock near where Hernandez was working. Various cross-complaints were filed in this action, and Cross-Defendant and Cross-Complainant Doo-Rite Painting, Inc. (“Doo-Rite”) moves for an order that there be separate trials of Plaintiffs’ Complaint and the remaining cross-complaints of Cross-Complainants Alpha Beta Company[1], FP Contracting, Inc., and Doo-Rite. Plaintiffs do not oppose as long as bifurcation would permit full disposition of Plaintiffs’ claims in the main action before any trial on the cross-actions would occur.

Discussion

Code of Civil Procedure section 1048(b) provides: “The court, in furtherance of convenience or to avoid prejudice, or when separate trials will be conducive to expedition and economy, may order a separate trial of any cause of action, including a cause of action asserted in a cross-complaint, or of any separate issue or of any number of causes of action or issues, preserving the right of trial by jury required by the Constitution or a statute of this state or of the United States.” ((Code Civ. Proc., § 1048, subd. (b).)

Code of Civil Procedure sections 597 and 598 allow a court to order that the trial of any issue or part thereof proceed before the trial of any other issue to promote the ends of justice or the economy and efficiency of handling the litigation. Additionally, Evidence Code section 320 provides that trial courts have discretion to regulate the order of proof. “[T]rial courts have broad discretion to determine the order of proof in the interests of judicial economy.” ((Grappo v. Coventry Fin. Corp. (1991) 235 Cal.App.3d 496, 504.) The objective of bifurcation is “avoidance of the waste of time and money caused by the unnecessary trial of damage questions in cases where the liability issue is resolved against the plaintiff.” ((Horton v. Jones (1972) 26 Cal.App.3d 952, 955.)

Doo-Rite contends that severing the cross-actions from the main action will simplify the case for all parties and promote judicial efficiency. Doo-Rite argues that the main action, which is brought by Plaintiffs against Alpha Beta Company only, can easily be separated from the cross-actions, which all sound in indemnity. Doo-Rite argues that Plaintiffs’ claims against Alpha Beta Company are straightforward, while the cross-claims are more complicated and involve facts which are irrelevant to the Complaint. The cross-claims may implicate evidence related to insurance coverage and workers’ compensation insurance, which may potentially confuse the jury and unfairly prejudice Plaintiffs and/or Doo-Rite.

Based on the foregoing, and in light of the lack of a substantive opposition from any of the parties, the Court finds good cause to order that trial on Plaintiffs’ Complaint proceed and be completed before trial on any of the cross-complaints may commence .

Conclusion

Based on the foregoing, the Court grants Doo-Rite’s motion.

Defendant is ordered to provide notice of this ruling.

DATED: August 27, 2020 ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court

Case Number: BC616313    Hearing Date: August 10, 2020    Dept: 50

THE COURT HAS REVIEWED THE ISSUES RAISED AT THE LAST HEARING AND REVIEWED THE BRIEFS PREVIOUSLY FILED.  THE COURT HAS NOT CHANGED THE SUBSTANCE OF THE TENTATIVE WHICH APPEARS BELOW.  THE COURT DID NOTICE TWO TYPOGRAPHICAL ERRORS THAT IT CORRECTED (P. 7 LINE 5  IN THE PARAGRAPH THAT STARTS WITH "DOO-RITE ARGUES":  THE PHRASE "DOES NOT CONTAIN" WAS ORIGINALLY OMITTED AFTER THE WORDS "SUBCONTRACT AGREEMENT" AND PAGE 13, LINE 18 IN THE PARGARAPH THAT STARTS WITH "THE PARTIES AGREE":  THE WORD "INDEMNITY" SHOULD HAVE BEEN "INDEMINIFY.)  THE COURT ALSO MODIFIED A RULING ON THE SECOND OBJECTION OF DOO-RITE TO ALPHA BETA'S EVIDENCE TO ADD AN ADDITIONAL SENTENCE THAT WAS NOT OVERRULED.  THAT CHANGE ALSO HAD NO IMPACT ON THE TENTATIVE.

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiffs Onesimo Benitez Hernandez (“Hernandez”) and Maricela Benitez (jointly, “Plaintiffs”) filed this personal injury action on April 8, 2016. This action arises from injuries sustained by Hernandez when he was allegedly struck by a dumpster or container that was pushed into him by a tractor-trailer backing up into the loading dock near where Hernandez was working. The tractor-trailer was allegedly being driven and operated by Rodolfo Trujillo (“Trujillo”).

Various cross-complaints were filed in this action, and now Cross-Defendant Doo-Rite Painting, Inc. (“Doo-Rite”) moves for summary judgment or, in the alternative, summary adjudication as to the operative First Amended Cross-Complaint of Defendant Alpha Beta Company dba Food 4 Less (“Alpha Beta”) and the operative Second Amended Cross-Complaint of Cross-Defendant FP Contracting Inc. (“FP”).

Parties

In the Complaint, Plaintiffs named The Kroger Co., (“Kroger”), Ralphs Grocery Company (“Ralphs”), Food 4 Less Holdings, Inc., and Food 4 Less of Southern California as defendants. These defendants were alleged to have owned and operated the tractor-trailer and employed the driver of the tractor-trailer.

Alpha Beta

On July 6, 2016, Alpha Beta filed an Answer to the Complaint, noting that it had been incorrectly named and served as Food 4 Less of Southern California. On October 18, 2016, Plaintiffs dismissed without prejudice Kroger, Ralphs, and Food 4 Less Holdings, Inc.

On November 8, 2017, Alpha Beta filed a Cross-Complaint for declaratory relief and indemnification against Doo-Rite and FP. At the time of the incident, Hernandez was employed by Doo-Rite, which itself was subcontracted by FP to provide painting services at the Food 4 Less store. On April 11, 2018, Alpha Beta filed the operative First Amended Cross-Complaint (“FACC”) against FP and Doo-Rite, asserting causes of action for (1) breach of contract – third party beneficiary, (2) express indemnity, (3) equitable indemnity, (4) apportionment of fault, and (5) declaratory relief.[1]

FP

On January 16, 2018, FP filed a Cross-Complaint against Doo-Rite and Alpha Beta. The operative Second Amended Cross-Complaint (“SACC”) was filed on August 1, 2019, asserting claims for (1) equitable indemnity, (2) express indemnity, (3) equitable contribution, (4) breach of contract, and (5) declaratory relief against Alpha Beta, Doo-Rite, Ralphs, Kroger, and Kroger Dedicated Logistics Co. On July 12, 2019, FP dismissed the first and third causes of action (for equitable indemnity and equitable contribution).

Ralphs

During the course of this litigation, counsel for Alpha Beta informed the parties and the Court that a mistake had been made. Alpha Beta had originally responded to Plaintiffs’ Complaint because the incident occurred at a Food 4 Less store. Evidently, Trujillo was not employed by Alpha Beta, and the tractor-trailer driven by Trujillo was not owned by Alpha Beta. Rather, Trujillo was employed by Ralphs, and the tractor-trailer was owned by Ralphs. However, the Court denied Alpha Beta’s motion for leave to amend all of its pleadings to substitute Ralphs as the correct responding party on October 1, 2019, encouraging the parties to informally reach an agreement regarding Ralphs’s entry into the case (and Alpha Beta’s exit from the case). It does not appear that such an agreement has been made.

Evidence

The Court rules on Alpha Beta’s evidentiary objections as follows:

Objection 1: sustained

Objection 2: sustained

Objection 3: sustained as to the first sentence and overruled as to the second sentence

Objection 4: sustained

Objection 5: sustained as to “or anyone else” and overruled as to the remainder

The Court rules on Doo-Rite’s objections to Alpha Beta’s evidence as follows:

Objection 1: overruled (see Sweetwater Union High School Dist. v. Gilbane Building Co. (2019) 6 Cal.5th 931, 943-944, fn. 8, disapproving Gatton v. A.P. Green Services, Inc. (1998) 64 Cal.App.4th 688.)

Objection 2: overruled as to “I remember there was a lady, but she didn’t give me her name or address. She had like a little girl or a little boy with her” and sustained as to the remainder

Objection 3: overruled

Objection 4: overruled

Objection 5: overruled

Objection 6: overruled

Objection 7: overruled

Objection 8: overruled

The Court rules on Doo-Rite’s objections to FP’s evidence as follows:

Objection 1: overruled

Objection 2: overruled

Objection 3: overruled

Objection 4: overruled

Legal Standard

“[A] motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 437c, subd. (c).) The moving party bears the initial burden of production to make a prima facie showing that there are no triable issues of material fact. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) If the moving party carries this burden, the burden shifts to the opposing party to make a prima facie showing that a triable issue of material fact exists. ((Ibid.) 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.)

When a defendant seeks summary judgment, he/she must show either (1) that one or more elements of the cause of action cannot be established; or (2) that there is a complete defense to that cause of action. (Code Civ. Proc., § 437c, subd. (p)(2).)

Discussion

FP’s SACC

FP alleges the following: FP entered into a subcontract with Doo-Rite (SACC, ¶¶ 17, 26); the subcontract requires Doo-Rite to indemnify and defend FP from the losses alleged by Plaintiffs (SACC, ¶ 17); Doo-Rite refused to indemnify or defend FP in Plaintiffs’ action (SACC, ¶ 20); the subcontract also requires Doo-Rite to obtain and utilize workers compensation insurance and to name FP and “Owner” as additional insureds (SACC, ¶¶ 26-27); Doo-Rite failed to utilize its workers compensation insurance (SACC, ¶ 29); and the subcontract also requires Doo-Rite to name “Owner” as an additional insured, but Doo-Rite failed to name “Owner” as an additional insured and/or failed to accept FP’s tender as an additional insured (SACC, ¶ 30).

Doo-Rite moves for summary judgment or, in the alternative, summary adjudication of the remaining three causes of action (express indemnity, breach of contract, and declaratory relief) of FP’s SACC.

First, Doo-Rite contends that FP’s causes of action for express indemnity and declaratory relief[2] have no merit because the indemnity provision of the subcontract does not apply to Plaintiff’s accident. That provision provides in pertinent part as follows:

“To the fullest extent permitted by law, Subcontractor shall indemnify, hold harmless and defend Owner, Contractor and their agents, employees, sureties and representatives from all claims, demands, causes of actions and liabilities of every kind and nature whatsoever arising out of or in connection with Subcontractor’s operations, work performed under this Agreement, and the scope of work identified in this Agreement. This indemnity and duty to defend shall apply regardless of any passive negligent act or omission of Owner or Contractor, or their agents or employees. However, Subcontractor’s obligation to indemnify and defend pursuant to this Agreement shall not pertain to any claims arising from the active negligence or sole willful misconduct of Owner or Contractor or their agents or employees, or caused solely by any defect in the designs provided by them.” (Doo-Rite’s Ex. 28, § 7.) In the subcontract, “Subcontractor” is defined as Doo-Rite; and “Contractor” is defined as FP. (Doo-Rite’s Ex. 28, p. 1.) “Owner” is undefined in the subcontract. (Doo-Rite’s Undisputed Material Fact (“UMF”) 6.)

Doo-Rite contends that the exception for “active negligence or sole willful misconduct of Owner or Contractor or their agents or employees” applies in this case, characterizing the accident as the result of Trujillo’s active negligence. Doo-Rite presents evidence that Trujillo was Alpha Beta’s employee. (UMF 21.[3]) Doo-Rite also presents evidence that Trujillo was actively negligent because he failed to adequately check his surroundings in order to safely back up the tractor-trailer. (UMF 24-28.) However, Doo-Rite fails to address a threshold issue: whether “Owner” means Alpha Beta. Doo-Rite itself asserts that “[t]he language of the Subcontract is ambiguous at best, and there is evidence that the ‘Owner’ referred to in the Subcontract may mean an entirely different entity [from Alpha Beta].” (Mot., p. 12:11-12.) Based on the plain language of the indemnity provision in the subcontract, there are two elements to the exception—(1) there must be active negligence or sole willful misconduct, and (2) the active negligence or sole willful misconduct must be by the Owner or Contractor or their agents or employees. There is no dispute that the individual whose conduct is at issue is Trujillo, and there is no evidence that Trujillo is an agent or employee of FP/“Contractor”. Therefore, in order to make its prima facie case in support of summary judgment, Doo-Rite must establish that Trujillo was an agent or employee of “Owner,” and in order to do that, Doo-Rite must establish who “Owner” is. The Court finds that Doo-Rite has failed to do so. Indeed, Doo-Rite effectively takes the position that Alpha Beta is not “Owner” in arguing that Alpha Beta is not a third-party beneficiary to the subcontract. (See Mot., pp. 11:20-12:25.)

Next, Doo-Rite contends that FP’s breach of contract cause of action has no merit because FP cannot show that Doo-Rite breached any terms of the subcontract agreement. FP alleges that Doo-Rite breached the subcontract agreement by (1) failing to accept FP’s tender on the basis as an additional insured, (2) failing to name “Owner” as an additional insured, and (3) failing to utilize the required workers compensation insurance.

Doo-Rite argues that FP cannot demonstrate breach for failing to accept FP’s tender as an additional insured because the subcontract agreement does not contain such an obligation. Doo-Rite points out that there is no allegation in the SACC that the subcontract agreement contains a term requiring Doo-Rite to accept FP’s tender as an additional insured. Because a defendant’s motion for summary judgment or summary adjudication “necessarily includes a test of the sufficiency of the complaint,” when a defendant asserts that a cause of action has no merit because it does not state facts sufficient to constitute a cause of action, the court may “treat the motion as a motion for judgment on the pleadings.” (American Airlines, Inc. v. County of San Mateo (1996) 12 Cal.4th 1110, 1117-1118.) The Court notes that FP does not address this argument in its opposition. Therefore, the Court construes FP’s silence as a concession of the merits of Doo-Rite’s argument and declines to grant FP leave to amend the cause of action.

Next, Doo-Rite argues that FP cannot demonstrate breach for failing to name “Owner” as an additional insured because FP waived that requirement. It is undisputed that Doo-Rite provided FP with a certificate of liability insurance on or about March 20, 2014. (UMF 10.) The certificate names FP as an additional insured, but does not name any other additional insureds. (UMF 12; Doo-Rite’s Ex. 44.) Thereafter, Doo-Rite commenced work pursuant to the subcontract agreement; Hernandez’s accident occurred on April 16, 2016, while he was acting within the course and scope of his employment with Doo-Rite. (UMF 2, 18-20.) It is undisputed that FP did not give notice of any purported defects with the certificate of liability insurance prior to this litigation. (UMF 11.) It is further undisputed that FP paid Doo-Rite in full for its work under the subcontract agreement and did not withhold any payment from Doo-Rite for work at the premises or any other projects. (UMF 38.)

“Waiver is an intentional relinquishment of a known right.” (Gould v. Corinthian Colleges, Inc. (2011) 192 Cal.App.4th 1176, 1179.) “It may be implied through conduct manifesting an intention to waive.” (Ibid.) “Acceptance of benefits under a lease is conduct that supports a finding of waiver.” (Ibid.) Here, the evidence presented demonstrates that FP accepted the benefits of the subcontract agreement—Doo-Rite’s painting services—and therefore, FP waived any defect in Doo-Rite’s provision of liability insurance. The Court notes that FP does not address this argument in its opposition, either.

The only theory of breach of contract addressed by FP in its opposition is the argument that Doo-Rite breached the subcontract by failing to utilize the required workers’ compensation insurance.

The subcontract provision at issue provides in pertinent part as follows:

“Before starting work on the project, Subcontractor and its subcontractors will supply to contractor duly issued certificated [sic] of insurance, which name Contractor and Owner as additional insured, showing in force insurance per the Contract Documents and in no case less then [sic] the following: (a) Comprehensive general liability policies that are in comprehensive form …. (b) Automobile liability policy in comprehensive form …. (c) Workers compensation insurance shall comply with the statutory form.” (Doo-Rite’s Ex. 28, § 13.)

Doo-Rite contends that FP cannot demonstrate breach because the subcontract agreement did not require Doo-Rite to “utilize” workers’ compensation insurance, but only to obtain it. (UMF 14-17.) FP disputes this by pointing to deposition testimony by Doo-Rite’s person most knowledgeable and its signatory to the subcontract agreement, David Kim. (FP’s Responses to UMF 14-17.) Mr. Kim testified that he understood that Doo-Rite had the responsibility to both obtain and use workers’ compensation insurance in the event that one of Doo-Rite’s employees became injured in the scope of employment. (FP’s Ex. C, pp. 38:18-41:18.) Specifically,

Mr. Kim responded “Yes, I guess” to the following question: “Regardless of who injured your employee, was your understanding of this clause in this workers’ – of this contract was that you had to report an injury of your employee to your workers’ compensation insurance carrier?” (FP’s Ex. C, p. 41:11-18.)

Doo-Rite argues that the term “utilize” is vague and therefore a failure to “utilize” workers’ compensation insurance cannot be the basis for the finding of a breach. The Court disagrees that the term “utilize” is vague. In the testimony cited above from Mr. Kim’s testimony, it is evident that “utilize” means reporting an employee’s injury to the workers’ compensation insurance carrier. Moreover, FP submits evidence that Mr. Kim was aware of Hernandez’s injury but chose not to report Hernandez’s injury to the workers’ compensation insurance carrier because Mr. Kim was afraid that his insurance premiums would go up. (FP’s Ex. B, pp. 24:24-25:1; FP’s Ex. C, pp. 42:1-44:15.) Instead of reporting Hernandez’s injury, Doo-Rite paid him directly while he took time off work to recover from his injury. (FP’s Ex. B, p. 25:2-25.) This evidence raises a triable issue of fact as to the element of breach.

Nevertheless, Doo-Rite also argues that FP cannot demonstrate that it was damaged as a result of the breach. The Court first notes that FP’s asserted theory of damage is that FP was damaged by Doo-Rite’s failure to submit a workers’ compensation claim for Hernandez’s injuries because when Hernandez did eventually submit the claim, it was denied as being untimely, resulting in Hernandez incurring costs for medical treatment on a liened basis. (FP’s Opp’n, p. 7:5-7; see also FP’s Additional Material Fact (“AMF”) 2.) FP asserts that these costs are greater than if Hernandez had undergone treatment through the workers’ compensation system. (FP’s Opp’n, p. 1:21-24.) In other words, the damages are that FP has been exposed to liability for Hernandez’s medical costs (as asserted in the instant lawsuit) even though it contracted with Doo-Rite to limit that liability (by requiring purchase of workers’ compensation insurance).

Doo-Rite contends that FP is shielded from liability to Hernandez through the doctrine of workers’ compensation exclusivity. But the entire argument for why this is so is contained in one conclusory sentence: “FP is still shielded from liability to plaintiff through the exclusive remedy doctrine and Privette v. Superior Court (Contreras) (1993) 5 Cal.4th 689 and its progeny.” (Mot., p. 18:14-16.) There is no actual discussion of Privette in Doo-Rite’s moving papers, and no application of Privette to the facts of this case. The only substantive discussion of Privette is contained in Doo-Rite’s reply. Nevertheless, the Court also notes that FP does not address this argument in its opposition and offers no rebuttal to Doo-Rite’s assertion that workers’ compensation exclusivity insulates FP from liability for Hernandez’s injuries.

An employee is “generally prohibited from pursuing any tort remedies against [an] employer or its agents” because the employer is already liable for an employee’s injuries arising out of and in the course of the employment under the workers’ compensation system. (Light v. Department of Parks & Recreation (2017) 14 Cal.App.5th 75, 96); (Lab. Code, § 3600, subd. (a) [workers’ compensation liability “shall, without regard to negligence, exist against an employer for any injury sustained by his or her employees arising out of and in the course of the employment . . . in those cases where the . . . conditions of compensation concur.”].) Workers’ compensation is the exclusive remedy for injuries linked “in some causal fashion” to employment. (King v. CompPartners, Inc. (2018) 5 Cal.5th 1039, 1052.) “[A]ll that is required is that the employment be one of the contributing causes without which the injury would not have occurred.” (Ibid.)

In Privette v. Superior Court (1993) 5 Cal.4th 689 (Privette), the general exclusivity rule was extended beyond an employer to a hirer of the employer. “[A]n independent contractor’s employee generally may not recover tort damages for work-related injuries from the contractor’s hirer” because the hirer is “indirectly paying for the cost of [workers’ compensation] coverage, which the [hired] contractor presumably has calculated into the contract price.” (Alvarez v. Seaside Transportation Services LLC (2017) 13 Cal.App.5th 635, 639-640.) In the context of a summary judgment motion, “[t]he Privette line of decisions establishes a presumption that an independent contractor’s hirer ‘delegates to that contractor its tort law duty to provide a safe workplace for the contractor’s employees.’” (Id. at p. 642.) This presumption “affects the burden of producing evidence,” which means that a moving party on summary judgment “need only show it is entitled to the benefit of [the] presumption . . . in order to shift the burden of proof to the opposing party to show there are triable issues of fact.” (Id. at pp. 643-644.) In other words, once the moving party establishes the “foundational facts” that the Privette presumption applies, the burden shifts to the opposing party to show that a triable issue of material fact exists, such as by showing that an exception to the Privette rule applies. (Id. at p. 644 [the evidence cited by the Court of Appeal establishing the “foundational facts” was (1) as to the defendant owner, evidence that the plaintiff’s employer was hired to perform work on a specific project by the owner, (2) as to the other defendants who were the owner’s contractors, evidence that the contractors were also hired by the owner to perform work on the same project, and (3) evidence that the plaintiff was injured while working on the project].)

Here, the Court finds that Doo-Rite has established the foundational facts. Doo-Rite presents evidence that Doo-Rite was hired by FP to perform painting services at a Food 4 Less store (UMF 2) and that Hernandez, an employee of Doo-Rite, was injured while performing the contracted painting work at the Food 4 Less store (UMF 18, 20, 28). Therefore, the burden shifts to FP to show that a triable issue of fact exists. The Court finds that FP has failed to meet that burden. Accordingly, the Court finds that Doo-Rite has met its burden of showing that the breach of contract cause of action has no merit because FP cannot show that it was damaged as a result of any breach, and that FP has failed to show that a triable issue of fact exists thereto.

Alpha Beta’s FACC

Alpha Beta alleges the following: Alpha Beta entered into a contract with FP to perform a remodel of the subject Food 4 Less store (Doo-Rite, Ex. 3, FACC, ¶ 10); FP and Doo-Rite entered into a subcontract to provide painting services for the remodel (Doo-Rite, Ex. 3, FACC, ¶ 10); the subcontract includes a provision for Doo-Rite to indemnify Alpha Beta from all claims arising out of the remodel project (Doo-Rite, Ex. 3, FACC, ¶ 11); Alpha Beta is an intended third party beneficiary of the subcontract (Doo-Rite, Ex. 3, FACC, ¶ 12); and Doo-Rite breached the subcontract by failing to indemnify and defend Alpha Beta in Plaintiffs’ lawsuit (Doo-Rite, Ex. 3, FACC, ¶ 13).

As a threshold matter, Doo-Rite argues that Alpha Beta has no valid claims against Doo-Rite because counsel for Alpha Beta has asserted that Ralphs, and not Alpha Beta, is the proper entity that should be named as a defendant in this lawsuit. As already noted above, Alpha Beta requested leave to amend its pleadings to substitute Ralphs in for Alpha Beta, and Doo-Rite contends that Alpha Beta’s conduct is “effectively” an admission that Alpha Beta has no valid claims against Doo-Rite. (Mot., p. 8:25-26.) Whatever type of admission Alpha Beta has made, it is not a “judicial admission.” “Judicial admissions may be made in a pleading, by stipulation during trial, or by response to request for admission.” (Barsegian v. Kessler & Kessler (2013) 215 Cal.App.4th 446, 451.) Moreover, “a judicial admission is ordinarily a factual allegation by one party that is admitted by the opposing party.” (Id. at p. 452 [emphasis in original].) There is no evidence that Doo-Rite agrees or admits that Ralphs is the proper entity in this lawsuit. Therefore, the Court declines to grant summary judgment against Alpha Beta on this basis.

As to the substantive arguments, Doo-Rite contends that Alpha Beta’s claims for equitable indemnity, apportionment, and declaratory relief are barred by workers’ compensation exclusivity. In its FACC, Alpha Beta alleges that to the extent that Alpha Beta is found liable for Plaintiffs’ claims, Doo-Rite is required to indemnify Alpha Beta because Doo-Rite is the primary wrongdoer. (Doo-Rite, Ex. 3, FACC, ¶¶ 21-22, 26-27, 29.) Doo-Rite argues that the exclusive remedy of workers’ compensation applies to bar these types of claims.

Labor Code section 3864 provides: “If an action as provided in this chapter prosecuted by the employee, the employer, or both jointly against the third person results in judgment against such third person, or settlement by such third person, the employer shall have no liability to reimburse or hold such third person harmless on such judgment or settlement in absence of a written agreement so to do executed prior to the injury.”

Alpha Beta argues workers’ compensation law is inapplicable because Hernandez’s injuries did not arise solely out of his work. In support, Alpha Beta points to deposition testimony by Mr. Kim and by Hernandez regarding the fact that neither of them reported Hernandez’s injury to Doo-Rite’s workers’ compensation insurance carrier. (Alpha Beta’s Ex. 4 (Hernandez Depo.), p. 73:5-19; Alpha Beta’s Ex. 6 (Kim Depo.), pp. 26:22-27:2.) But as already noted above, workers’ compensation is the exclusive remedy for injuries linked “in some causal fashion” to employment. (King v. CompPartners, Inc., supra, 5 Cal.5th at p. 1052.) “[A]ll that is required is that the employment be one of the contributing causes without which the injury would not have occurred.” (Ibid.) Here, it is undisputed that Hernandez would not have been injured in the manner that he was but for his employment. (UMF 28.)

Alpha Beta next argues that Labor Code section 3864 does not apply when there has been a violation of Labor Code section 5401, which requires employers to apprise their employees of potential workers’ compensation claims. (Within one working day of receiving notice or knowledge of injury . . . which results in lost time . . . or which results in medical treatment beyond first aid, the employer shall provide . . . a claim form and a notice of potential eligibility for benefits under this division to the injured employee . . . .Lab. Code, § 5401, subd. (a) [“Within one working day of receiving notice or knowledge of injury . . . which results in lost time . . . or which results in medical treatment beyond first aid, the employer shall provide . . . a claim form and a notice of potential eligibility for benefits under this division to the injured employee . . . .”].) But as noted by Doo-Rite, “the remedy for breach of an employer’s duty to notify is a tolling of the statute of limitations if the employee, without that tolling, is prejudiced by that breach.” (Kaiser Found. Hosps. Permanente Medical Group v. Workers' Comp. Appeals Bd. (1985) 39 Cal.3d 57, 64 (emphasis added).)

The parties agree that Labor Code section 3864 would not bar Alpha Beta’s indemnity claims if a written indemnity agreement existed that obligated Doo-Rite to indemnify Alpha Beta with respect to Hernandez’s accident. There is no dispute that such an agreement clearly exists as between Doo-Rite and FP. And Alpha Beta alleges that Doo-Rite’s indemnity obligations to Alpha Beta arise out of the FP/Doo-Rite subcontract agreement. In the FACC, Alpha Beta alleges that it is a third-party beneficiary to the FP/Doo-Rite subcontract agreement. (Doo-Rite, Ex. 3, FACC, ¶ 12.)

“A third party beneficiary may enforce a contract made expressly for his or her benefit.” (Kaiser Eng'rs v. Grinnell Fire Prot. Sys. Co. (1985) 173 Cal.App.3d 1050, 1055.) “The intent of the contracting parties to benefit expressly that third party must appear from the terms of the contract.” (Ibid.) “[T]he third person need not be named or identified individually to be an express beneficiary.” (Ibid.) “A third party may enforce a contract if it can be shown that he or she is a member of the class for whose express benefit the contract was made.” (Ibid.)

Once again, the Court sets forth the indemnity provision at issue.

“To the fullest extent permitted by law, Subcontractor shall indemnify, hold harmless and defend Owner, Contractor and their agents, employees, sureties and representatives from all claims, demands, causes of actions and liabilities of every kind and nature whosoever arising out of or in connection with Subcontractor’s operations, work performed under this Agreement, and the scope of work identified in this Agreement. This indemnity and duty to defend shall apply regardless of any passive negligent act or omission of Owner or Contractor, or their agents or employees. However, Subcontractor’s obligation to indemnify and defend pursuant to this Agreement shall not pertain to any claims arising from the active negligence or sole willful misconduct of Owner or Contractor or their agents or employees, or caused solely by and defect in the designs provided by them.” (Doo-Rite’s Ex. 28, § 7.)

The issue comes down to whether “Owner” is Alpha Beta. Doo-Rite asserts that it did not understand “Owner” to mean Alpha Beta at the time the subcontract was executed. (Doo-Rite’s Ex. 9 (Kim Decl.), ¶ 9.) Alpha Beta counters that Mr. Kim testified at deposition that he understood “Owner” to mean “Food 4 Less.” (Alpha Beta’s AMF 2; Alpha Beta’s Ex. 6, pp. 51:25-52:3, 55:14-19, 59:17-19.) Alpha Beta argues that the FP/Doo-Rite subcontract references a Prime Contract, and that Prime Contract defines the term “Owner” (as used in the Prime Contract) as “Ralphs Grocery Company, an Ohio corporation dba Food 4 Less.” (Doo-Rite’s Ex. 29.) Alpha Beta contends that Alpha Beta is merely a “form” of Food 4 Less but does not define what that means in the context of this lawsuit. Alpha Beta offers no evidence in support of this assertion, nor is the Court aware of any law that allows two distinct entities to become interchangeable because they are “forms” of the same entity. Thus, the Court finds that Alpha Beta has failed to raise a triable issue of fact as to whether the parties to the subcontract agreement intended for Alpha Beta to be a third-party beneficiary to the indemnity provision. Accordingly, Labor Code section 3864 bars Alpha Beta’s equitable indemnity, apportionment, and declaratory relief claims. Similarly, the Court finds that Doo-Rite has demonstrated that Alpha Beta’s claims for breach of contract and express warranty, which are both based on its status as a third-party beneficiary to the FP/Doo-Rite subcontract agreement (Doo-Rite’s Ex. 3, FACC, ¶¶ 12, 16), are without merit because Alpha Beta has failed to raise a triable issue of fact as to whether it was a third-party beneficiary to the FP/Doo-Rite subcontract agreement.

Conclusion

Based on the foregoing, the Court grants Doo-Rite’s motion for summary judgment as to Alpha Beta.

The Court denies Doo-Rite’s motion for summary judgment as to FP. The Court grants Doo-Rite’s motion for summary adjudication as to FP’s breach of contract cause of action. The Court denies Doo-Rite’s motion for summary adjudication as to FP’s express indemnity and declaratory relief causes of action.

The Court orders Doo-Rite to file and serve a proposed form of judgment as to Alpha Beta within 10 days of the date of this order.

Doo-Rite is ordered to give notice of this ruling.

DATED: August 10, 2020 ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court

Case Number: BC616313    Hearing Date: August 05, 2020    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiffs Onesimo Benitez Hernandez (“Hernandez”) and Maricela Benitez (jointly, “Plaintiffs”) filed this personal injury action on April 8, 2016. This action arises from injuries sustained by Hernandez when he was allegedly struck by a dumpster or container that was pushed into him by a tractor-trailer backing up into the loading dock near where Hernandez was working. The tractor-trailer was allegedly being driven and operated by Rodolfo Trujillo (“Trujillo”). In the Complaint, Plaintiffs named The Kroger Co., (“Kroger”), Ralphs Grocery Company (“Ralphs”), Food 4 Less Holdings, Inc., and Food 4 Less of Southern California as defendants. These defendants were alleged to have owned and operated the tractor-trailer and employed the driver of the tractor-trailer.

On July 6, 2016, Alpha Beta filed an Answer to the Complaint, noting that it had been incorrectly named and served as Food 4 Less of Southern California. On October 18, 2016, Plaintiffs dismissed without prejudice Kroger, Ralphs, and Food 4 Less Holdings, Inc.

On November 8, 2017, Alpha Beta filed a Cross-Complaint for declaratory relief and indemnification against Doo-Rite and FP. At the time of the incident, Hernandez was employed by Doo-Rite, which itself was subcontracted by FP to provide painting services at the Food 4 Less store.

On April 11, 2018, Alpha Beta filed the operative First Amended Cross-Complaint (“FACC”) against FP and Doo-Rite, asserting causes of action for (1) breach of contract – third party beneficiary, (2) express indemnity, (3) equitable indemnity, (4) apportionment of fault, and (5) declaratory relief.[1] Of the five causes of action, only the third, fourth, and fifth causes of action are asserted against FP.

FP now moves for summary judgment as to Alpha Beta’s operative First Amended Cross-Complaint. Alpha Beta[2] opposes.

Legal Standard

“[A] motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” ((Code Civ. Proc., § 437c, subd. (c).) The moving party bears the initial burden of production to make a prima facie showing that there are no triable issues of material fact. ((Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) If the moving party carries this burden, the burden shifts to the opposing party to make a prima facie showing that a triable issue of material fact exists. ((Ibid. .) 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.)

When a defendant seeks summary judgment, he/she must show either (1) that one or more elements of the cause of action cannot be established; or (2) that there is a complete defense to that cause of action. ((Code Civ. Proc., § 437c, subd. (p)(2).)

Evidence

The Court rules on FP’s evidentiary objections as follows:

Objection 1: sustained

Objection 2: sustained

Discussion

FP contends that all of Alpha Beta’s claims against it are without merit because they require a showing of joint and several liability on the part of FP, and FP is immune to any such liability pursuant to the Privette doctrine.

“In general, indemnity refers to the obligation resting on one party to make good a loss or damage another party has incurred.” ((Prince v. Pacific Gas & Electric Co. (2009) 45 Cal.4th 1151, 1157 [internal quotations omitted].) In California, “we now recognize there are [] two basic types of indemnity: express indemnity and equitable indemnity.” ((Ibid. .) As is relevant here, equitable indemnity “is premised on a joint legal obligation to another for damages.” ((Id. at p. 1158.) “Although traditional equitable indemnity once operated to shift the entire loss upon the one bound to indemnify, the doctrine is now subject to allocation of fault principles and comparative equitable apportionment of loss.” ((Ibid. .) Nevertheless, “there can be no indemnity without liability.” ((Id. at p. 1159.) “To state a claim for indemnification, a defendant must allege that the same harm for which he may be held liable is properly attributable—at least in part—to the alleged indemnitor.” (Molko v. Holy Spirit Assn. (1988) 46 Cal.3d 1092, 1127, superseded by statute on other grounds.) “It is not sufficient, for purposes of indemnification, for a defendant simply to claim someone else caused all or part of the plaintiff’s damages.” (Ibid. .) “Absent some claim of mutual liability for the same harm, []—under joint-and-several or vicarious liability principles, for example—an indemnification action will not lie.” ((Id. at p. 1128.)

Similarly, a cause of action for contribution is grounded in the existence of a joint, or joint and several obligation. ((See Civ. Code, § 1432 [“[A] party to a joint, or joint and several obligation, who satisfies more than his share of the claim against all, may require a proportionate contribution from all the parties joined with him.”].) Without such an obligation, there is no right to recover contribution from another party.

Accordingly, FP argues that if there is no basis for finding FP liable for Hernandez’s injuries, then there is no merit to Alpha Beta’s claims for equitable indemnity, contribution, and declaratory relief.[3] In support of the contention that FP cannot be liable for Hernandez’s injuries, FP cites to Privette v. Superior Court (1993) 5 Cal.4th 689 (Privette).

In Privette, an owner hired a roofing contractor to install a tar and gravel roof on a duplex he owned, and during the course of the project, one of the roofing contractor’s employees was severely burned by hot tar. (Id. at p. 692.) In addition to seeking recovery under workers’ compensation, the employee sued the owner, asserting that “because of the inherent danger of working with hot tar, [the owner] should, under the doctrine of peculiar risk, be liable for injuries to [the employee] that resulted from [the contractor’s] negligence.” (Ibid.) The doctrine of peculiar risk was created as an exception to the common law rule that “a person who hired an independent contractor generally was not liable to third parties for injuries caused by the contractor’s negligence in performing the work.” (Id. at p. 693.) The doctrine “pertains to contracted work that poses some inherent risk of injury to others” and was adopted “to ensure that innocent third parties injured by the negligence of an independent contractor hired by a landowner to do inherently dangerous work on the land would not have to depend on the contractor’s solvency in order to receive compensation for the injuries.” (Id. at pp. 693-694.) “Gradually, the peculiar risk doctrine was expanded to allow the hired contractor’s employees to seek recovery from the nonnegligent property owner for injuries caused by the negligent contractor.” (Id. at p. 696.) The California Supreme Court in Privette rejected that expansion, holding that “[w]hen, as here, the injuries resulting from an independent contractor’s performance of inherently dangerous work are to an employee of the contractor, and thus subject to workers’ compensation coverage, the doctrine of peculiar risk affords no basis for the employee to seek recovery of tort damages from the person who hired the contractor but did not cause the injuries.” (Id. at p. 702.)

FP’s argument is that, in line with Privette, Hernandez cannot sue FP for his injuries under a peculiar risk theory (and therefore, the general rule of nonliability applies), and consequently, Alpha Beta cannot recover from FP under equitable indemnity principles. Alpha Beta counters that framing this action as one involving the peculiar risk doctrine is inapplicable because there were no peculiar risks involved. Indeed, Alpha Beta contends that being hit by a truck is not a risk inherent in painting. “The term ‘peculiar risk’ means neither a risk that is abnormal to the type of work done, nor a risk that is abnormally great; it simply means ‘a special, recognizable danger arising out of the work itself.’” ((Id. at p. 695 [internal quotations omitted].) Such a risk may arise “either from the nature or the location of the work” and is the type of risk “against which a reasonable person would recognize the necessity of taking special precautions.” ((Ibid. .) Instead, Alpha Beta argues that the controlling doctrine is that found in the Restatement of Torts, section 414, which provides: “One who entrusts work to an independent contractor, but who retains the control of any part of the work, is subject to liability for the physical harm to others for whose safety the employer owes a duty to exercise reasonable care, which is caused by his failure to exercise his control with reasonable care.”

Regardless of whether the peculiar risk doctrine applies, the “retained control” theory set forth in the Restatement of Torts, section 414 is the same “retained control” theory that operates as an exception to the general rule of nonliability. (See Alvarez v. Seaside Transportation Services, LLC, supra, 13 Cal.App.5th at p. 641 [noting that “when the hirer retains control over safety conditions at the worksite” and “exercise[s] that control in a way that affirmatively contribute[s] to the employee’s workplace injury,” the hirer may be held liable (internal quotations omitted)].) Stated otherwise, if a triable issue exists as to “retained control,” then there is a triable issue as to FP’s liability.

It is undisputed that FP was the general contractor and hiring party of Doo-Rite for the renovation work at the subject Food 4 Less store. (FP’s Undisputed Material Fact (“UMF”) 1-2.) It is further undisputed that Hernandez was employed by Doo-Rite to perform services at the Food 4 Less store and that he was injured while performing such services. (UMF 3-6.) FP contends that it retained no control over the safety conditions at Hernandez’s work site, and in support, offers evidence that Alpha Beta made the final decision about the scheduling of any deliveries to the worksite during construction (UMF 8, 13); that FP did not rent the stationary container bin that Trujillo backed into (UMF 10); that nobody other than Doo-Rite gave Hernandez instructions on what to do at the premises (UMF 15); that Doo-Rite was responsible for supplying and placing its own safety equipment (UMF 19); and that Doo-Rite supplied its own portable lighting for the worksite (UMF 9).

“In order for a worker to recover on a retained control theory, the hirer must engage in some active participation.” ((Tverberg v. Fillner Constr. (2012) 202 Cal.App.4th 1439, 1446.) “An affirmative contribution may take the form of actively directing a contractor or an employee about the manner of performance of the contracted work.” (Ibid. .) “When the employer directs that work be done by use of a particular mode or otherwise interferes with the means and methods of accomplishing the work, an affirmative contribution occurs.” (Ibid. .) “By contrast, passively permitting an unsafe condition to occur rather than directing it to occur does not constitute affirmative contribution.” (Ibid. .) “The failure to institute specific safety measures is not actionable unless there is some evidence that the hirer or the contractor had agreed to implement these measures.” (Ibid. .)

Alpha Beta contends that there is evidence that FP retained control over the worksite that actively contributed to Hernandez’s injuries. First, Alpha Beta asserts that FP told Doo-Rite where and when to paint. (Alpha Beta’s Additional Material Fact (“AMF”) 7.) In support, Alpha Beta cites to the deposition testimony of Christopher Hinck, the FP project manager for the construction project at the subject Food 4 Less store, but the Court sustained FP’s evidentiary objection to this particular testimony (Alpha Beta’s Ex. 2, Hinck Depo., p. 23:11-15). Next, Alpha Beta asserts that FP was so involved in the details of the work that it told subcontractors where they could and could not place their refuse bins. (AMF 8.) But the evidence cited in support does not bear out this assertion. Mr. Hinck testified that FP tells subcontractors where to place the bins, but then stated that “[t]hat direction usually comes from the Kroger project manager.” (Alpha Beta’s Ex. 2, Hinck Depo., p. 18:14-19.) Alpha Beta contends that FP had the authority to decide if a particular Doo-Rite employee could work on a project (AMF 9), but there is no evidence that FP did, in fact, make such a decision on the subject Food 4 Less project. Alpha Beta asserts that FP was responsible for making decisions about safety (AMF 14) and that if FP had seen something unsafe at a job site, FP would have done something about it (AMF 13). But neither of those facts suggest an affirmative contribution by FP to Hernandez’s injuries.

Alpha Beta cites to McCarty v. Department of Transportation (2008) 164 Cal.App.4th 955, 963-964 for the proposition that, in a case where a hirer had the authority to stop work it considered unsafe and failed to prevent an unsafe method of work, there was sufficient retained control to potentially impose liability on the hirer. But the portion of the case where the Court of Appeal discussed the sufficiency of the evidence to support the jury’s verdict under the retained control doctrine is unpublished. ((See Id. at p. 980.) Thus, McCarty is not binding authority as to the sufficiency of evidence to support a retained control theory of liability. Alpha Beta also cites to Ray v. Silverado Constructors (2002) 98 Cal.App.4th 1120, 1131-1132 for the proposition that where a contractor is contractually obligated to ensure compliance with safety requirements and fails to do so, a contractor may be held vicariously liable for a subcontractor’s employee’s injuries. But Ray is likewise inapposite. As noted by FP, there is no admissible evidence of a contract between FP and Alpha Beta.

Alpha Beta separately argues that FP can be liable to Hernandez under a negligent undertaking theory, which Alpha Beta characterizes as another exception to the Privette doctrine. The Court notes that Alpha Beta cites to no binding authority setting forth negligent undertaking as a recognized exception to the Privette doctrine or as a recognized exception to the general rule of nonliability. Regardless, as set forth in the case cited by Alpha Beta, a cause of action for negligent undertaking requires showing that “[FP] undertook, gratuitously or for consideration, to render services to [Hernandez].” ((Peredia v. HR Mobile Services, Inc. (2018) 25 Cal.App.5th 680, 688.) There is no showing of that basic element here.

Accordingly, the Court finds that FP has met its burden of showing that Alpha Beta’s causes of action for equitable indemnity, contribution, and declaratory relief have no merit and that Alpha Beta has failed to raise a triable issue of fact thereto.

Conclusion

Based on the foregoing, the Court grants FP’s motion for summary judgment.

The Court orders FP to file and serve a proposed form of judgment within 10 days of the date of this order.

FP is ordered to give notice of this ruling.

DATED: August 5, 2020 ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court

Case Number: BC616313    Hearing Date: March 03, 2020    Dept: 50

THE COURT NEEDS ADDITIONAL TIME TO CONSIDER THE MOTION OF DOO-RITE AS TO THE FACC OF ALPHA bETA AND THE SACC OF FP CONSULTING. THE HEARING IS CONTINUED TO MARCH 24, 2020 AT 1:30 PM.  MOVING PART IS ORDERED TO GIVE NOTICE.

Case Number: BC616313    Hearing Date: December 17, 2019    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Cross-Defendant Doo-Rite Painting, Inc. (“Doo-Rite”) moves for summary judgment or, in the alternative, summary adjudication of the First Amended Cross-Complaint of Alpha Beta Company dba Food 4 Less and the Second Amended Cross-Complaint of FP Contracting, Inc.

The Court did not timely receive the required binder/spiral compilations with courtesy copies of all moving, opposing, and reply papers and all supporting or related documents. Accordingly, the Court continues the hearing on the MSJ/MSA to a date that will be set by the Clerk after consulting with counsel. The Clerk will contact counsel so no appearance is necessary.

The Court orders Doo-Rite to lodge directly in Department 50, at least 5 court days before the new MSJ/MSA hearing date, the fully indexed and tabbed binders or preferably spiral bound compilations of all of the moving, opposing, reply and supporting papers (e.g., declarations, requests for judicial notice, etc., but not proposed orders or proofs of service).

Doo-Rite is ordered to give notice of this Order.

DATED: December 16, 2019

________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court