Pending - Other Pending
Contract - Other Contract
BASTEDO JEFFREY BRUCE
SUNLAND WOOD PRODUCTS INC.
MCKINNISS MARK ROBERT
6/13/2022: Substitution of Attorney
5/20/2022: Order - ORDER RE: CROSS-DEFENDANT JOSE FLORES'S DEMURRER AND MOTION TO STRIKE THE CROSS-COMPLAINT
5/23/2022: Answer - ANSWER TO THE CROSS- COMPLAINT BY CROSS- DEFENDANT JOSE FLORES.
5/20/2022: Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITH MOTION TO STRIKE (CCP 430.10) CROS...)
5/9/2022: Opposition - OPPOSITION OPPOSITION TO AMENDED MOTION TO STRIKE
5/9/2022: Opposition - OPPOSITION OPPOSITION TO AMENDED DEMURRER
5/9/2022: Request for Judicial Notice
5/10/2022: Notice - NOTICE OF NON-RECEIPT
5/11/2022: Notice - NOTICE OF WITHDRAWAL
5/11/2022: Reply - REPLY TO SUNLAND'S OPPOSITION TO PLAINTIFF'S DEMURRER WITH MOTION TO STRIKE
3/22/2022: Case Management Statement
3/23/2022: Case Management Statement
4/5/2022: Minute Order - MINUTE ORDER (CASE MANAGEMENT CONFERENCE; ORDER TO SHOW CAUSE RE: FAILURE T...)
4/14/2022: Notice of Ruling
3/11/2022: Motion to Strike (not initial pleading) - MOTION TO STRIKE (NOT INITIAL PLEADING) AMENDED
3/11/2022: Demurrer - with Motion to Strike (CCP 430.10) - DEMURRER - WITH MOTION TO STRIKE (CCP 430.10) AMENDED
3/11/2022: Declaration - DECLARATION IN SUPPORT OF AMENDED NOTICE OF DEMURRER
2/22/2022: Opposition - OPPOSITION TO EX PARTE APPLICATION OF PLAINITFF/CROSS- DEFENDANT JOSE FLORES FOR LEAVE TO FILE FIRST AMENDED COMPLAINT
Hearing07/25/2022 at 08:30 AM in Department 26 at 111 North Hill Street, Los Angeles, CA 90012; Case Management ConferenceRead MoreRead Less
Hearing07/25/2022 at 08:30 AM in Department 26 at 111 North Hill Street, Los Angeles, CA 90012; Hearing on Motion for Leave to Amend PLAINTIFF?S NOTICE OF MOTION AND MOTION FOR LEAVE TO FILE HIS FIRST AMENDED COMPLAINTRead MoreRead Less
DocketSubstitution of Attorney; Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketAnswer (TO THE CROSS- COMPLAINT BY CROSS- DEFENDANT JOSE FLORES.); Filed by Jose Flores (Cross-Defendant)Read MoreRead Less
Docketat 08:30 AM in Department 26, Elaine Lu, Presiding; Hearing on Demurrer - with Motion to Strike (CCP 430.10) (CROSS-DEFENDANT JOSE FLORES DEMURRER TO THE CROSS-COMPLAINT WITH MOTION TO STRIKE THE ENTIRE CROSS COMPLAINT) - HeldRead MoreRead Less
Docketat 08:30 AM in Department 26; Case Management Conference - Not Held - Continued - Court's MotionRead MoreRead Less
DocketMinute Order ( (Hearing on Demurrer - with Motion to Strike (CCP 430.10) CROS...)); Filed by ClerkRead MoreRead Less
DocketOrder (RE: CROSS-DEFENDANT JOSE FLORES'S DEMURRER AND MOTION TO STRIKE THE CROSS-COMPLAINT); Filed by ClerkRead MoreRead Less
DocketReply (to Sunland's opposition to plaintiff's demurrer with motion to strike); Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketNotice (of withdrawal); Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketAnswer; Filed by Jeffrey Bruce Bastedo (Defendant); Sunland Wood Products, Inc. (Defendant)Read MoreRead Less
DocketOrder to Show Cause Failure to File Proof of Service; Filed by ClerkRead MoreRead Less
DocketNotice of Case Management Conference; Filed by ClerkRead MoreRead Less
DocketProof of Personal Service; Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketProof of Personal Service; Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketCivil Case Cover Sheet; Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketOrder on Court Fee Waiver (Superior Court); Filed by ClerkRead MoreRead Less
DocketNotice of Case Assignment - Unlimited Civil Case; Filed by ClerkRead MoreRead Less
DocketSummons (on Complaint); Filed by Jose Flores (Plaintiff)Read MoreRead Less
DocketComplaint; Filed by Jose Flores (Plaintiff)Read MoreRead Less
Case Number: *******3451 Hearing Date: May 20, 2022 Dept: 26
JEFFREY BRUCE BASTEDO; SUNLAND WOOD PRODUCTS, INC.; et al.,
Case No.: *******3451
Hearing Date: May 20, 2022
[TENTATIVE] ORDER RE:
CROSS-DEFENDANT JOSE FLORES’S DEMURRER AND MOTION TO STRIKE THE CROSS-COMPLAINT
On November 29, 2021, Plaintiff Jose Flores (“Flores”) filed the instant breach of contract action against Defendants Jeffrey Bruce Bastedo (“Bastedo”) and Sunland Wood Products, Inc. (“SWPI”). The complaint asserts four causes of action for (1) Breach of Contract, (2) Unfair Trade Practices, (3) Breach of the Implied Duty of Good Faith and Fair Dealing, and (4) Fraud in the Inducement.
On December 29, 2021, Cross-Complainant SWPI filed a cross-complaint against Cross-Defendant Flores asserting two causes of action for (1) Recovery of Money Paid to Unlicensed Contractor, and (2) Declaratory Relief.
On January 19, 2022, Flores filed the instant demurrer and motion to strike the cross-complaint. On March 11, 2022, Flores filed an amended demurrer and motion to strike the cross-complaint. On May 9, 2022, SWPI filed an opposition to both the demurrer and motion to strike. On May 11, 2022, Flores filed a joint reply for the demurrer and motion to strike.
Allegations of the Operative Complaint and Cross-Complaint
The Complaint alleges that:
On September 10, 2021, Flores and Defendants Bastedo and SWPI met at SWPI and Bastedo’s shop in North Hollywood where SWPI and Bastedo contracted to have Flores’ workers – Jesus Diaz and Alejandro Hernandez – to perform finished carpentry installations for at least three years. (Complaint 13.) Pursuant to this agreement, SWPI and Bastedo agreed to pay Flores for his workers’ time at $40 and hour. (Id. 14.) Further, the parties agreed that “they w[ould] not approach or solicit each other's workers, employees, clients or suppliers for the purpose for transactions outside the agreement.” (Id. 15.) In reliance on this agreement, Flores terminated an agreement with another contractor and prioritized this agreement with Defendants. (Id. 16.)
“On 10/28/2021 [Flores] sent an email to [SWPI and Bastedo] with a written version of the agreement which was a list of the terms verbally agreed by the parties on 9/10/2021.” (Id. 18.) “[SWPI and Bastedo] paid [Flores] for his workers upon an invoice dated 9/25/2021 and 10/9/2021 just like it was agreed.” (Id. 19.)
“On 10/24/2021 Alejandro Hernandez called [Flores] to inform him That [sic] he and Jesus Diaz decided to stop working for plaintiff, terminating their business relationship.” (Id. 20.) SWPI and Bastedo had – in violation of the agreement – poached Flores’ workers by offering them more money and other incentives to work directly for SWPI and Bastedo cutting out Flores. (Id. 20.)
The Cross-Complaint alleges that:
“SWPI is in the business of selling wood products and performing carpentry construction work for third parties. As such, virtually all of its projects require SWPI and any subcontractors it utilizes to be duly licensed by the California Contractors State License Board (‘CSLB’) at all times during performance of the work.” (Cross-Complaint 10.)
On September 10, 2021, Flores approached the president of SWPI – Bastedo – about working on future projects but failed to inform Bastedo or SWPI that he did not have a contractor’s license. (Id. 11.) Bastedo, while familiar with Flores, did not know that Flores did not have a contractor’s license. (Id. 12.)
Flores supplied workers from his company for various projects being worked on by SWPI and submitted invoices for such work. (Id. 13.) Specifically, from September 27, 2021 through October 9, 2021, Flores submitted, and SWPI paid for invoices for work performed totaling $17,200.00. (Id. 15.) “[Flores] w[as] not properly licensed at all times during performance of the work[,] and the work was of the nature which required a contractor’s license.” (Id. 17.)
Accordingly, SWPI seeks recovery of the $17,200.00 paid under Business and Professions Code section 7031 subdivision (b), damages under Code of Civil Procedure section 1029.8, and declaratory relief finding that Flores cannot bring an action against SWPI pursuant to Business and Professions Code section 7031 subdivision (a). (Id. 17-24.)
Request for Judicial Notice
SWPI requests that the Court take Judicial Notice of:
A. Flores’ Verified Responses to SWPI’s Requests for Admissions, Set No. One
“[T]he court passing upon the question of the demurrer may look to affidavits filed on behalf of plaintiff, and the plaintiff's answers to interrogatories [Citation], as well as to the plaintiff's response to request for admissions.” (Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604.) Thus, “[t]he court will take judicial notice of records such as admissions, answers to interrogatories, affidavits, and the like, when considering a demurrer, only where they contain statements of the plaintiff or his agent which are inconsistent with the allegations of the pleading before the court.” (Id. at pp.604-605.)
Here, the pleading before the Court for purposes of the instant demurrer and motion to strike is the Cross-Complaint – not the Complaint. Moreover, Flores’s Responses to the Request for Admission are not inconsistent with the Cross-Complaint but rather support the allegations of the cross-complaint. Accordingly, the request for judicial notice is DENIED.
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.) No other extrinsic evidence can be considered (i.e., no “speaking demurrers”). (Ion Equipment Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881.)
A demurrer for sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal. App. 4th 740, 747.) When considering demurrers, courts read the allegations liberally and in context. (Taylor v. City of Los Angeles Dep’t of Water & Power (2006) 144 Cal. App. 4th 1216, 1228.) In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal. App. 4th 968, 994.) “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.” (SKF Farms v. Superior Ct. (1984) 153 Cal. App. 3d 902, 905.) “The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.” (Hahn, supra, 147 Cal.App.4th at 747.)
A special demurrer for uncertainty, Code of Civil Procedure 430.10(f), is disfavored and will only be sustained where the pleading is so bad that defendant cannot reasonably respond—i.e., cannot reasonably determine what issues must be admitted or denied, or what counts or claims are directed against him/her. (Khoury v. Maly’s of Calif., Inc. (1993) 14 Cal.App.4th 612, 616.) Moreover, even if the pleading is somewhat vague, “ambiguities can be clarified under modern discovery procedures.” (Ibid.)
Motion to Strike Standard
Motions to strike are used to reach defects or objections to pleadings that are not challengeable by demurrer (i.e., words, phrases, prayer for damages, etc.). (See CCP 435-437.) A party may file a motion to strike in whole or in part within the time allowed to respond to a pleading, however, if a party serves and files a motion to strike without demurring to the complaint, the time to answer is extended. (CCP 435(b)(1), 435(c).)
A motion to strike lies only where the pleading has irrelevant, false, or improper matter, or has not been drawn or filed in conformity with laws. (CCP 436.) The grounds for moving to strike must appear on the face of the pleadings or by way of judicial notice. (CCP 437.)
Meet and Confer Requirement
Code of Civil Procedure section 430.41, subdivision (a) requires that “[b]efore filing a demurrer pursuant to this chapter, the demurring party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.” The parties are to meet and confer at least five days before the date the responsive pleading is due and if they are unable to meet the demurring party shall be granted an automatic 30-day extension. (CCP 430.41(a)(2).) The demurring party must also file and serve a declaration detailing the meet and confer efforts. (Id. at (a)(3).) If an amended pleading is filed, the parties must meet and confer again before a demurrer may be filed to the amended pleading. (Id. at (a).) There is a similar meet and confer requirement for motions to strike. (CCP 435.5.)
The Court notes that Flores has fulfilled the meet and confer requirement. (Demurrer, Exh. A.)
Discussion - Demurrer
The Cross-Complaint seeks disgorgement pursuant to Business and Professions Code section 7031(b) and a declaration that Flores was never entitled to any payment from SWPI by because Flores did not have the required contractor's license for purposes of Business and Professions Code section 7031(a). (Cross-Complaint 17-24.)
Cross-Defendant Flores demurrers to the Cross-Complaint on the grounds that the Cross-Complaint fails to demonstrate that Flores was required to have a contractor’s license. Flores further contends that he was not the employer of the workers he sent to SWPI but instead was acting as a staffing agent.
Business and Professions Code “Section 7031 is part of the Contractors' State License Law ( 7000 et seq.). It ‘imposes strict and harsh penalties for a contractor's failure to maintain proper licensure. Among other things, the [Contractors' State License Law] states a general rule that, regardless of the merits of the claim, a contractor may not maintain any action, legal or equitable, to recover compensation for “the performance of any act or contract” unless he or she was duly licensed “at all times during the performance of that act or contract.” ( 7031, subd. (a).)’ [Citation.]” (Kim v. TWA Construction, Inc. (Cal. Ct. App., May 13, 2022, No. H045900) -- Cal.Rptr.3d -- 2022 WL 1515516, at *6.) “[S]ection 7031 bars all actions, regardless of the equities and however they are characterized, which effectively seek ‘compensation’ for illegal unlicensed contract work. [Citation.] Thus, if the primary ‘relief sought is compensation’ for the unlicensed work, then ‘section 7031 bars the action.’ [Citation.]” (Id. at *7.)
Further, pursuant to Business and Professions Code section 7031(b), “[e]xcept as provided in subdivision (e), a person who utilizes the services of an unlicensed contractor may bring an action in any court of competent jurisdiction in this state to recover all compensation paid to the unlicensed contractor for performance of any act or contract.” (Alatriste v. Cesar's Exterior Designs, Inc. (2010) 183 Cal.App.4th 656, 664.)
In sum, Business and Professions Code section 7031 acts as both a shield and a sword preventing any recovery from those who do unlicensed construction work and “ ‘allow[ing] persons who utilize unlicensed contractors to recover compensation paid to the contractor for performing unlicensed work.’ [Citations.]” (Id. at p.666.)
A “ ‘Contractor,’ … is synonymous with ‘builder’ and, … is any person who undertakes to or offers to undertake to, or purports to have the capacity to undertake to, or submits a bid to, or does himself or herself or by or through others, construct, alter, repair, add to, subtract from, improve, move, wreck or demolish any building, highway, road, parking facility, railroad, excavation or other structure, project, development or improvement, or to do any part thereof, … ‘Contractor’ includes subcontractor and specialty contractor.” (Bus. & Prof. Code, 7026, [italics added].)
Flores contends that he acted as a staffing agent by facilitating two individuals to work for SWPI. Further, Flores contends that the two individuals were not his employees but employees of SWPI. These contentions are beyond the scope of a demurrer as a demurrer can be used only to challenge defects that appear on the face of the pleading under attack – i.e., the cross-complaint – or from matters outside the pleading that are judicially noticeable. (Blank, supra, 39 Cal 3d at p.318.) Whether Flores was acting as a staffing agent or as a contractor is a matter beyond the face of the cross-complaint. Moreover, Flores has not provided matter of which the Court can take judicial notice showing that Flores was not acting as a contractor when facilitating the two individuals to work for SWPI. Rather, to state a claim under Business and Professions Code section 7031(b) the cross-complaint need only allege that Flores was unlicensed, did work that required a license, and that Flores received payment for unlicensed work. To state a defense under Business and Professions Code section 7031(a), the pleading need only allege that Flores is attempting to recover compensation for unlicensed work. The Cross-Complaint does allege these elements.
Here, the cross-complaint alleges in relevant part that SWPI performs carpentry construction work for third parties. (Cross-Complaint 10.) This work required SWPI and any subcontractors it used to be licensed during the performance of the work. (Ibid.) Flores approached SWPI about doing work on future projects – i.e., submitted a bid. (Id. 11.) Flores provided workers from his company to perform finished carpentry installations for SWPI’s projects – i.e., did construction work through others. (Id. 13-14.) Flores did not have a contractor’s license. (Id. 11-12.) SWPI paid $17,200.00 for the work that Flores’ workers did. (Id. 15.) Moreover, Flores has filed suit seeking recovery for additional funds owed for the work performed by his workers on SWPI’s projects. (Id. 23.) Though these allegations do not specify how Flores was working through the individuals he provided or how Flores submitted the bid, these allegations are sufficient to state a claim under Business and Professions Code section 7031. “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 [cross-complainant]’s proof need not be alleged.” (C.A. v. William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872.)
Accordingly, Flores’ demurrer is OVERRULED.
Discussion – Motion to Strike
The motion to strike seeks to strike the entire cross-complaint on the grounds that the claims under Business and Professions Code section 7031 are unsupported. As discussed above with the demurrer, the Court disagrees. Accordingly, Flores’ motion to strike is DENIED.
CONCLUSION AND ORDER
Based on the foregoing, Cross-Defendant Jose Flores’ demurrer to the Cross-Complaint is OVERRULED
Cross-Defendant Jose Flores’ motion to strike is DENIED.
Cross-Defendant Jose Flores is to file and serve an answer to the Cross-Complaint within fifteen (15) days of notice of this order.
The case management conference is continued to July 25, 2022 at 8:30 am.
Sunland Wood Products, Inc. is to give notice and file proof of service of such.
DATED: May 20, 2022
Judge of the Superior Court
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