T.A. STUDIO CITY, LLC VS 11906 SAN VICENTE, LLC

Tentative Rulings

Case Number: *******6541    Hearing Date: July 23, 2020    Dept: 39

T.A. Studio City, LLC v. 11906 San Vicente, LLC, et al., 19STCV26641

July 23, 2020

1.  Motion for Leave to File First Amended Complaint by Plaintiff T.A. Studio City, LLC

The motion is GRANTED. Plaintiff is to file the proposed First Amended Complaint by July 31, 2020.

2.   Motion to Compel Responses to Discovery by Plaintiff T.A. Studio City, LLC: the unopposed motion is GRANTED.

Defendant 11906 San Vicente, LLC is ORDERED to provide complete, verified, substantive, objection-free responses to Plaintiff’s form interrogatories, special interrogatories, and requests for production by August 14, 2020, along with all responsive documents. The court DEEMS Plaintiff’s requests for admissions admitted.

The court GRANTS the request for monetary sanctions in the amount of $2,640 against Defendant 11906 San Vicente, LLC and its counsel of record. Monetary sanctions are due and payable by August 14, 2020.

Background

This case arises in connection with plaintiff T.A. Studio City, LLC (hereinafter T.A. Studio or Plaintiff)’s alleged commercial lease of retail space from defendant 11906 San Vicente, LLC (hereinafter 11906 San Vicente or Defendant). (Compl. at p. 1.) Defendant allegedly knowingly overcharged Plaintiff under the commercial lease by increasing the rent in a greater amount than allowed by the lease. (Ibid.) Plaintiff further alleges that Defendant also violated the lease by improperly charging Plaintiff a fixed monthly charge rather than charging it a pro rata share of the landlord’s actual expenses and by charging Plaintiff more than the fixed management fee of 2.5% that is allowed.

Plaintiff filed the Complaint on July 29, 2019, alleging six causes of action for: (1) breach of contract, (2) breach of the covenant of good faith and fair dealing, (3) conversion, (4) unfair business practices in violation of Business & Professions Code, ; 17200, et seq. (the Unfair Competition Law or UCL), (5) accounting, and (6) declaratory relief.

1. Plaintiff’s Motion for Leave to file a First Amended Complaint (FAC):

Discussion

I. Legal Standard

California law holds that leave to amend is to be granted liberally, to accomplish substantial justice for both parties. (Code Civ. Proc., ; 473, subd. (a); Hirsa v. Superior Court (1981) 118 Cal.App.3d 486, 488-489 (Hirsa).) “If the motion to amend is timely made and the granting of the motion will not prejudice the opposing party, it is error to refuse permission to amend….” (Morgan v. Superior Court (1959) 172 Cal.App.2d 527, 530 (Morgan).) Prejudice includes “delay in trial, loss of critical evidence, or added costs of preparation.” (Solit v. Tokai Bank, Ltd. New York Branch (1999) 68 Cal.App.4th 1435, 1448 (Solit).)

“Assuming proper notice, the trial court has wide discretion in determining whether to allow the amendment, but the appropriate exercise of that discretion requires the trial court to consider a number of factors: ‘including the conduct of the moving party and the belated presentation of the amendment. The law is well settled that a long-deferred presentation of the proposed amendment without a showing of excuse for the delay is itself a significant factor to uphold the trial court’s denial of the amendment. [Citation.]’ ” (Leader v. Health Ind. of America, Inc. (2001) 89 Cal.App.4th 603, 613 (Leader).) “The power to permit amendments is interpreted very liberally as long as the plaintiff does not attempt to state facts which give rise to a wholly distinct and different legal obligation against the defendant.” (Herrera v. Superior Court (1984) 158 Cal.App.3d 255, 259 (Herrera).)

While the court has the discretion to deny an amendment that fails to state a cause of action or defense (Foxborough v. Van Atta (1994) 26 Cal.App.4th 217, 230 (Foxborough)), the court normally should not consider the viability of the proposed amendments in deciding whether or not to grant a motion for leave to amend a pleading (Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048 (Kittredge)). “[E]ven if the proposed legal theory is a novel one, ‘the preferable practice would be to permit the amendment and allow the parties to test its legal sufficiency by demurrer, motion for judgment on the pleadings or other appropriate proceedings.’ [Citation.]” (Kittredge, ibid.)

II. Analysis

A. Procedural Considerations

A motion to amend a pleading before trial must include a copy of the proposed amendment or amended pleading and state which allegations were deleted from and which allegations were added to the previous pleading and identify the changes “by page, paragraph, and line number.” (Cal. Rules of Court, rule 3.1324(a).)

Plaintiff has attached a redline copy of the proposed verified FAC as Exhibit B to the Declaration of Michael T. Boardman (Boardman Declaration). This is sufficient to satisfy rule 3.1324(a).

Under rule 3.1324(b), “[a] separate declaration must accompany the motion and must specify: (1) The effect of the amendment; (2) Why the amendment is necessary and proper; (3) When the facts giving rise to the amended allegations were discovered; and (4) The reasons why the request for amendment was not made earlier.” (Cal. Rules of Court, rule 3.1324(b).)

The Boardman Declaration does not state the effect of the amendment, why the amendment was not made earlier, when the facts giving rise to the amended allegations were discovered, or the reasons why the request for amendment was not made earlier, and the motion is procedurally defective. Nevertheless, the submitted documents make clear that Plaintiff seeks to amend the Complaint to allege that Defendant also breached the lease in January 2020 by renting space in the shopping center to a company named Hot Pilates. (Boardman Decl. ¶ 4, Ex. B at p. 2 and ¶ 25.) Plaintiff’s moving papers establish that Plaintiff learned of the facts giving rise to the amended allegations in or around January 2020.

As Defendant does not object to the motion on procedural grounds, the court will exercise its discretion to consider the motion on its merits. The court, however, advises the parties that it expects them to comply with all statutory requirements and court rules.

B. Analysis

Generally, motions for leave to amend will be granted unless the party seeking to amend has been dilatory in bringing the proposed amendment before the court and the delay in seeking leave to amend will cause prejudice to the opposing party. (See Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 761 (Atkinson); Hirsa, supra, 118 Cal.App.3d at p. 490.) Indeed, “courts are much more critical of proposed amendments ... when offered after long unexplained delay or on the eve of trial [citations], or where there is a lack of diligence, or there is prejudice to the other party [citations].” (Permalab-Metalab Equip. Corp. v. Maryland Cas. Co. (1972) 25 Cal.App.3d 465, 472 (Permalab).)

Plaintiff moves for leave to add allegations that Defendant breached the lease during the pendency of this action by leasing space in the shopping center to a competing fitness company in violation of Article 27 of the Lease. (Mot. at p. 4.) Plaintiff argues that allowing the amendment would allow it to prosecute all of its claims in a single action, promoting judicial economy and preventing the risk of inconsistent ruling since all of the claims arise from the same Lease. (Mot. at p. 6.) According to Plaintiff, Defendant would not be prejudiced since it previously agreed to allowing an amendment to be filed. (Id. at pp. 6-7.)

Defendant opposes the motion on the grounds that the new allegations lack merit because Plaintiff did not proper notice to Defendant of its breach under the Lease. (Opp. at pp. 1-2.) Defendant further argues that the proposed claim is moot because the purported default was corrected with the termination and cancellation of the other tenant’s lease as of June 19, 2020. (Opp. at p. 2.)

Defendant’s arguments do not speak as to whether it would be proper to allow the amendment, but are an attempt to dismiss these proposed claims on their merits. While the court has the discretion to deny an amendment that fails to state a cause of action or defense (Foxborough, supra, 26 Cal.App.4th at p. 230), the court normally should not consider the viability of the proposed amendments in deciding whether or not to grant a motion for leave to amend a pleading (Kittredge, supra, 213 Cal.App.3d at p. 1048.) “[E]ven if the proposed legal theory is a novel one, ‘the preferable practice would be to permit the amendment and allow the parties to test its legal sufficiency by demurrer, motion for judgment on the pleadings or other appropriate proceedings.’ [Citation.]” (Kittredge, ibid.)

III. Conclusion

Accordingly, the court GRANTS the motion and leave to file the FAC. Plaintiff is ordered to file the proposed FAC by July 31, 2020. 

All that needs to be shown is that the discovery was properly served on the opposing party, that the time to respond has expired, and that no response been served. (Sinaiko Healthcare Consulting, Inc. v. Pacific Healthcare Consultants (2007) 148 Cal.App.4th 390, 403-404.) The moving party is not required to show a reasonable and good faith attempt to resolve the matter informally before filing the motion. The failure to timely respond also waives all objections, “including one based on privilege” or the protection of attorney work product. (Ibid.)

Plaintiff presents evidence that it propounded discovery on Defendant on December 18, 2019, including Plaintiff’s Requests for Production of Documents – Set One (RFPs), Form Interrogatories – General – Set One (FROGs), Special Interrogatories – Set One (SROGs), and Requests for Admissions – Set One (RFAs). (Boardman Decl. Exs. 1-4.) As this discovery was propounded by mail, Defendant’s responses were due on or before January 22, 2020. (See Code Civ. Proc., ;; 1013, subd. (a); 2030.260, subd. (a); 2031.260, subd. (a); 2033.260, subd. (a).) According to Plaintiff’s counsel Michael T. Boardman (Boardman) Plaintiff has not received responses to this discovery as of the filing of the motion on March 27, 2020. (Boardman Decl. ¶ 7.) Defendant has not filed an opposition and does not demonstrate that it served timely responses to the subject discovery.

As Defendant does not appear to have served responses to the propounded discovery, the court GRANTS the subject motions and ORDERS Defendant to serve complete, verified, substantive, objection-free responses to Plaintiff’s form interrogatories, special interrogatories, and requests for production and by August 14, 2020, along with all responsive documents. The court DEEMS Plaintiff’s requests for admissions admitted.

Monetary Sanctions

“If a party fails to serve a timely response [to interrogatories and inspection demands], and the propounding party moves for and obtains a court order compelling a response, the trial court must impose a monetary sanction against the delinquent party unless that party acted with ‘substantial justification’ or the sanction would otherwise be unjust.” (Sinaiko, supra, 148 Cal.App.4th at p. 404; see also Code Civ. Proc., ;; 2030.290, subd. (c); 2031.300, subd. (c).) The court must impose monetary sanctions on the party or attorney, or both, whose failure to serve a timely response to requests for admissions necessitated a motion. (Code Civ. Proc., ; 2033.280, subd. (c).)

Plaintiff requests monetary sanctions of $2,640 against Defendant and its counsel in connection with the subject motion. (Mot. at p. 2.) This amount is substantiated by Plaintiff’s counsel Boardman, who attests to an hourly rate of $645 on this matter and to spending approximately 4 hours in preparing and finalizing this motion and its related papers. (Boardman Decl. ¶ 9.) Plaintiff also incurred filing fees of $60 for each of the four motions, for a total of $240.

The court finds that monetary sanctions are reasonable, and GRANTS Plaintiff’s request. Defendant and his counsel of record are to pay monetary sanctions in the amount of $2,640. These monetary sanctions are due and payable by August 14, 2020.