Pending - Other Pending
Personal Injury - Other Personal Injury
HUEY P. COTTON
MICHAEL J. CONVEY
PREMIER JETS INC.
SOCAL JETS INC.
LEADER & BERKON LLP
WILLNER ARTHUR IRWIN
GRIFFITH DOUGLAS C. ESQ.
RUIZ RODOLFO F. ESQ.
4/20/2018: SUBSTITUTION OF ATTORNEY
9/18/2018: DEFENDANT'S NOTICE OF MOTION AND MOTION TO COMPEL PLAINTIFF'S RESPONSES TO DEFENDANT'S REQUEST FOR PRODUCTION OF DOCUMENTS (SET TWO); SPECIAL INTERROCATORIES (SET TWO); FORM INTERROGATORIES ? GENERAL
10/2/2018: PLAINTIFF'S OPPOSITION TO DEFENDANT'S MOTION TO COMPEL; DECLARATION OF ARTHUR I. WILLNER; EXHIBIT A
10/15/2018: Minute Order
10/30/2018: Minute Order
10/31/2018: Notice of Case Management Conference
11/21/2018: Case Management Statement
12/7/2018: Minute Order
2/8/2019: Notice of Case Reassignment and Order for Plaintiff to Give Notice
3/11/2019: Ex Parte Application
DocketStipulation and Order (for an Order); Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketNotice of Ruling; Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
Docketat 10:00 AM in Department U, Michael J. Convey, Presiding; Informal Discovery Conference (IDC) - Held[+] Read More [-] Read Less
DocketMinute Order ( (Informal Discovery Conference (IDC))); Filed by Clerk[+] Read More [-] Read Less
Docketat 08:30 AM in Department U, Michael J. Convey, Presiding; Hearing on Ex Parte Application (For an Order to Continue Trial, Final Status Conference, and all Related Cut-off Dates) - Held - Motion Granted[+] Read More [-] Read Less
DocketMinute Order ( (Hearing on Ex Parte Application For an Order to Continue Tria...)); Filed by Clerk[+] Read More [-] Read Less
DocketOpposition (Plaintiff's Opposition to Defendant's Ex Parte Motion to Continue Trial); Filed by Premier Jets, Inc. (Plaintiff)[+] Read More [-] Read Less
DocketEx Parte Application (for an Order to Continue Trial, FSC, and All Related Cut-Off Dates); Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketDeclaration in Support of Ex Parte Application; Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketNotice (of Informal Discovery Conference); Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketDEFENDANT'S NOTICE OF MOTION AND MOTION TO COMPEL PLAINTIFF'S RESPONSES TO DEFENDANT'S REQUEST FOR PRODUCTION OF DOCUMENTS (SET TWO); SPECIAL INTERROCATORIES (SET TWO); FORM INTERROGATORIES GENERAL (SET ONE); AND REQUEST FOR MONETARY SANCTIONS AGAINST P[+] Read More [-] Read Less
DocketSubstitution of Attorney; Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketSUBSTITUTION OF ATTORNEY[+] Read More [-] Read Less
DocketProof of Service[+] Read More [-] Read Less
DocketProof of Service (not Summons and Complaint); Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketAnswer; Filed by SoCal Jets, Inc. (Defendant)[+] Read More [-] Read Less
DocketANSWER OF SOCAL JETS, INC. TO COMPLAINT[+] Read More [-] Read Less
DocketCOMPLAINT FOR DAMAGES[+] Read More [-] Read Less
DocketComplaint; Filed by Premier Jets, Inc. (Plaintiff)[+] Read More [-] Read Less
DocketSUMMONS[+] Read More [-] Read Less
Case Number: ****2915 Hearing Date: August 24, 2020 Dept: U
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES - NORTHWEST DISTRICT
PREMIER JETS, INC.,
SOCAL JETS, INC. and DOES 1-10, inclusive,
CASE NO: ****2915
[TENTATIVE] ORDER RE: SOCAL JET’S MOTION FOR SUMMARY ADJUDICATION
August 24, 2020
On August 18, 2017, Premier Jets, Inc. (Premier) filed a complaint against SoCal Jets, Inc. (SoCal Jets) and Does 1-10, alleging damages for (1) negligence and (2) breach of contract.
Premier and SoCal Jets entered into a written contract whereby SoCal Jets was to inspect, perform maintenance, and repair a Learjet 36/36A aircraft (the “Aircraft”) owned by Premier. Under the Return to Service Agreement (RTSA) that was part of the parties’ contract, SoCal Jets was to perform its work and return the Aircraft to Premier within 21 days of its arrival. The RTSA included a clause providing:
SoCal Jets charges for the work will be reduced by $500 Dollars ($) per day for each day that it is required for SoCal Jets to complete the work beyond the completion date, except with respect to any excusable delays or extensions due to changes in the work scope. SoCal Jets charges for the work will be increased by same $500 Dollars ($) per day for each day SoCal Jets beats the Return to Service date. The sole and exclusive remedy of the customer and the sole and exclusive liability of SoCal Jets with respect to any failure of SoCal Jets to complete the work by the completion date, as extended due to any excusable delay or extensions due to changes in the work scope shall be limited to such reduction in SoCal Jets charges.
Although the parties have ascribed their own names to this provision, the Court will refer to this provision as the “$500-per-day clause.”
The Aircraft was delivered to SoCal Jets on October 11, 2016 and the completion date was 21 calendar days from arrival. The Aircraft was not returned to Premier within 21 days of arrival. Premier alleges this delay was caused by SoCal Jets’ failure to properly inspect, maintain, and repair the Aircraft causing it to become damaged and its component parts to become defective, inoperable, and malfunctioning.
SoCal Jets filed this motion for summary adjudication on February 27, 2020, arguing that Premier’s recovery is limited by the $500-per-day clause included in the RSTA, which it contends is a valid liquidated damages provision that covers any damages arising from delays. Premier counters that the $500-per-day clause applies only to delays in servicing and not to Premier’s damages for loss of use caused by SoCal Jets’ alleged negligence, but that it does not contest the validity of the liquidated damages clause if limited to its proper scope.
II. LEGAL STANDARD
In relevant part, Code of Civil Procedure section 437c, subdivision (f)(1) provides:
A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if that party contends that the cause of action has no merit or that there is no affirmative defense thereto, or that there is no merit to an affirmative defense as to any cause of action, or both, or that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more SoCal Jetss either owed or did not owe a duty to the Premier or Premiers. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.
As an exception to subdivision (f), “a party may a party may move for summary adjudication of a legal issue or a claim for damages other than punitive damages that does not completely dispose of a cause of action, affirmative defense, or issue of duty pursuant to this subdivision,” so long as the parties to the action “stipulate that the court shall hear this motion and that the resolution of this motion will further the interest of judicial economy by decreasing trial time or significantly increasing the likelihood of settlement.” (Code of Civil Procedure section 437c(t).)
“Summary adjudication is properly granted when there is no triable issue of material fact as to a cause of action and the moving party is entitled to judgment as a matter of law.” (Barnes v. Black (1999) 71 Cal.App.4th 1473, 1477.) Summary adjudication is procedurally identical to summary judgment motions and the same rules apply equally. (Blue Shield of California Life & Health Ins. Co. v. Superior Court (2011) 192 Cal.App.4th 727; Serri v. Santa Clara University (2014) 226 Cal.App.4th 830.)
A defendant making a motion for summary adjudication has the initial burden of showing that the cause of action lacks merit because one or more elements of the cause of action cannot be established or there is a complete defense to that cause of action, and if the defendant fails to make this initial showing, it is unnecessary to examine the plaintiff’s opposing evidence and the motion must be denied, but if the moving papers establish a prima facie showing that justifies a judgment in the defendant’s favor, the burden then shifts to the plaintiff to make a prima facie showing of the existence of a triable material factual issue. (Rehmani v. Superior Court (2012) 204 Cal.App.4th 945; RC Royal Development and Realty Corp. v. Standard Pacific Corp. (2009) 177 Cal.App.4th 1410.)
If a motion for summary adjudication is granted, at the trial of the action, the cause or causes of action within the action, affirmative defense or defenses, claim for damages, or issues of duty or other issues adjudicated shall be deemed to be established and the action shall proceed as to the cause or causes of action, affirmative defense or defenses, claim for damages, or issues remaining. (Code Civ. Proc. ; 437c(n)(1).)
SoCal Jets’ motion for summary adjudication rests on the interpretation of the $500-per-day clause. SoCal Jets argues that the clause should be interpreted to apply to any loss of use arising from the contract between the parties and, thus, restricts Premier’s recovery for such damages to the daily charges regardless of whether the delay was caused by Premier’s negligent repairs or by mere postponements in completion of the servicing of the Aircraft. Premier’s interpretation differs significantly from SoCal Jets’ construction of the $500-per-day clause. Premier argues that the provision provides a penalty for delayed completion of the work and an incentive for accelerated completion but says nothing about loss of use caused by negligent repair work and, thus, places no restrictions on Premier’s ability to recover damages for such losses.
The Court’s goal in interpreting a contract is to give effect to the mutual intention of the contracting parties at the time of contract formation. (Civ. Code, ; 1636.) If possible, the parties’ intention should be deduced from the written contract, but the Court may also consider the circumstances under which it was made and the matter to which it relates. (Id., ;; 1639, 1647.) The Court’s charge is to consider the contract as a whole and interpret its language in context giving effect to each provision, rather than interpret contractual language in isolation. (Id., ; 1641.)
Extrinsic evidence is admissible to explain the meaning of a written contract provided that the contract is reasonably susceptible of the meaning supported by the extrinsic evidence. (Casa Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336, 343.) A written contract should be construed most strongly against the drafting party (Civ. Code, ; 1654), but only if the other rules of interpretation and any extrinsic evidence do not resolve the ambiguity. (Steller v. Sears, Roebuck & Co. (2010) 189 Cal.App.4th 175, 183–184.)
“Where the meaning of the words used in a contract is disputed, the trial court must provisionally receive any proffered extrinsic evidence which is relevant to show whether the contract is reasonably susceptible of a particular meaning. . . . Indeed, it is reversible error for a trial court to refuse to consider such extrinsic evidence on the basis of the trial court's own conclusion that the language of the contract appears to be clear and unambiguous on its face. Even if a contract appears unambiguous on its face, a latent ambiguity may be exposed by extrinsic evidence which reveals more than one possible meaning to which the language of the contract is yet reasonably susceptible. . . .” (Wolf v. Superior Court (2004) 114 Cal. App. 4th 1343, 1350-1351 [citations and internal quotations omitted.)
“The interpretation of a contract involves ‘a two-step process: “First the court provisionally receives (without actually admitting) all credible evidence concerning the parties' intentions to determine ‘ambiguity,’ i.e., whether the language is ‘reasonably susceptible’ to the interpretation urged by a party. If in light of the extrinsic evidence the court decides the language is ‘reasonably susceptible’ to the interpretation urged, the extrinsic evidence is then admitted to aid in the second step—interpreting the contract.” (Winet v. Price (1992) 4 Cal.App.4th 1159, 1165, 6 Cal.Rptr.2d 554.) The trial court's determination of whether an ambiguity exists is a question of law, subject to independent review on appeal. (Ibid.) The trial court's resolution of an ambiguity is also a question of law if no parol evidence is admitted or if the parol evidence is not in conflict. However, where the parol evidence is in conflict, the trial court's resolution of that conflict is a question of fact and must be upheld if supported by substantial evidence. (Id. at p. 1166, 6 Cal.Rptr.2d 554.) Furthermore, “[w]hen two equally plausible interpretations of the language of a contract may be made ... parol evidence is admissible to aid in interpreting the agreement, thereby presenting a question of fact which precludes summary judgment if the evidence is contradictory.” [Citation]’” (Wolf v. Superior Court, supra, at p. 1351.)
Contract interpretation is solely a judicial function unless the interpretation turns on the resolution of a factual dispute concerning the credibility of extrinsic evidence. (Garcia v. Truck Ins. Exchange (1984) 36 Cal.3d 426, 439.) Absent a factual dispute concerning the credibility of extrinsic evidence, the trial court interprets a contract in light of the extrinsic evidence and resolves any ambiguity. (Legacy Vulcan Corp. v. Superior Court (2010) 185 Cal.App.4th 677, 688; Wolf v. Walt Disney Pictures & Television (2008) 162 Cal.App.4th 1107, 1126–1127.) Where the evidence creates a legitimate dispute as to the truth or falsity of a fact that is both extraneous to the contract and material to its interpretation, there is a triable issue that must be decided by the jury before the contract can be interpreted by the court. (Wolf, supra, 162 Cal.App.4th at p. 1127.)
In this case, SoCal Jets’ motion for summary adjudication asserts its preferred meaning of the $500-per-day clause and launches into its argument that the provision is a valid liquidated damages clause that precludes recovery of loss of use damages in excess of the daily charge under the provision. As a result, SoCal Jets’ offer of parol evidence in support of its contract interpretation is extremely thin, as its moving papers are focused solely on an evaluation of the provision’s character as a liquidated damages clause.
Specifically, SoCal Jets submitted evidence that Premier insisted on including the $500-per-day clause that “would reduce the amount owed to SoCal Jets by $500 per day if the work on the Plane was not completed by the agreed-to completion date.” (Roig Decl., ¶5.) SoCal’s President also testified that his company had never had a liquidated damages clause in any of its contracts and stated it was “only included because Roger Kelsay, the president of Premier Jets, requested that it be included.” (Id., ¶6.) He also stated that SoCal Jets’ technical sales representative sent a proposed draft of the desired liquidated damages provision to Premier managers, who requested no modifications in the language. (Id., ¶¶ 7-8.)
In opposition to the motion, Premier urges the Court to decide the motion based on the “undisputed facts (i.e., the plain language of the relevant contract terms).” (Opposition, p. 2.) While focused largely on the language of the RTSA, Premier also submitted evidence about the circumstances leading to the execution of the parties’ contract, including the RTSA.
Premier submitted a declaration from its founder and President, Roger Kelsay, who described the contracted work that was to be done by SoCal Jets and explained that, “[w]hen extensive work of this nature is improperly or negligently performed, it can potentially jeopardize the safety and lives or the crewmembers and passengers and cause significant economic loss due to the damage to and loss of use of the aircraft.” (Kelsay Decl., ¶ 3.) Kelsay also stated that Premier did not draft the RTSA which was provided by Jack Levandowski, Technical Sales Representative of SoCal Jets. (Id., ¶¶ 3-5.) According to Kelsay, Premier did not “insist upon or negotiate the terms of the RTSA that provided for reduction in the contract price of $500 per day for each day required for SoCal Jets to complete the work beyond the completion date, and that also provided for a $500 per day increase in the price for each day that SoCal Jets beat the completion date.” (Id., ¶5.)
Kelsay explained in his deposition that, on or about January 20, 2017, SoCal Jets finished its work on the Aircraft and delivered it to Premier to conduct a test flight, which revealed the serious defects that are at issue in this action. (Premier’s Exh. C, pp. 2-5.) When these defects were disclosed, Premier arranged for repairs to be conducted by another company. (Id., pp. 7-9.) Although SoCal Jets paid for the subsequent repair work, Premier seeks damages of $2,934,500, plus interest, for its lost use of the Aircraft and related damages. (Premier’s Exh. D, p. 2.)
The Court finds that SoCal Jets has failed to meet its initial burden of proof on the motion for summary adjudication. The bare statement of SoCal Jets’ President that the $500-per-day clause was included to “reduce the amount owed to SoCal Jets by $500 per day if the work on the Plane was not completed by the agreed-to completion date” does not tend to show that the RTSA is “reasonably susceptible” to the interpretation being urged by SoCal Jets. In the Court’s view, this statement undermines SoCal Jets’ preferred interpretation. Because SoCal Jets’ evidence does not permit the Court to conduct an assessment of whether there is any ambiguity in the contract language or whether the contract is susceptible of the interpretation suggested by SoCal Jets, the Court finds that SoCal Jets has not met its burden of proof on this motion.
Even if the burden shifts to Premier, moreover, there are factual disputes that bar summary adjudication of the issue. SoCal Jets’ President declares under oath that Premier drafted and insisted on the $500-per-day clause, while Premier’s President swears to the contrary. If the Court were to find an ambiguity based on a full record of parol evidence, this factual debate centers on a key issue that would have to be resolved by a jury, that is, who is the drafter against whom the language should be construed. (Civ. Code, ;1654.) Further, even if the Court concluded that SoCal Jets’ showing was sufficient to shift the burden of production, Premier’s responsive evidence about the context of the parties’ transaction, where a contractor’s negligently performed repairs can cause “significant economic loss due to the damage to and loss of use of the aircraft,” may raise a triable issue about how the $500-per-day clause should be interpreted. (Kelsay Decl., ¶ 3.)
Accordingly, the Court finds that SoCal Jets has not demonstrated that it is entitled to summary adjudication of the “liquidated damages” clause based on undisputed material facts.
For the foregoing reasons, SoCal Jet’s motion for summary adjudication is DENIED.
Premier is ordered to give notice of the Court’s ruling.
DATED: August 24, 2020
Hon. Theresa M. Traber
Judge of the Superior Court
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