Judge Alison Mackenzie, Case Number: 24STCV16648, Date: 2024-09-03 Tentative Ruling

Plaintiffs RJRP Family Trust Dates 5/8/1995 and Richard J. Rosiak Settlor/Trustee (collectively, “Plaintiff”) brought this action against Defendant Margarita Rosiak and unknown defendants seeking to quiet title to the following properties:

1308 Campbell Drive, Las Vegas, NV 89102

1805 Villa De Conde Way, Las Vegas, NV 891021

1901 Villa De Conde Way, Las Vegas, NV 89102

1913 Villa De Conde Way, Las Vegas, NV 89102

Defendant demurs to the complaint. Rosiak filed a late declaration contesting the service of the demurrer and that the trust has been revoked and requesting a continuance of the demurrer and for sanctions. Plaintiff does not otherwise oppose the merits of the demurrer.

The demurrer is granted.

The Court grants Defendant’s motion for judicial notice of the April 28, 2020, Notice of Revocation of the Trust (RJN #1) and the September 11, 2022, Nevada District Court’s Findings of Fact and Conclusions of Law (RJN #2).

With the demurrer, Defendant filed a declaration of counsel attaching an email from defense counsel to Plaintiff’s counsel. In the email, defense counsel explains the basis for the demurrer and requests to meet and confer with Plaintiff’s counsel. Rosenthal Decl. and Ex. The declaration states that defense counsel received no response to the email. Id. Rosiak complains that defense counsel did not meet and confer with him about the demurrer, but of course, he is represented by counsel and thus defense counsel correctly sought to meet and confer with Rosiak’s counsel, not Rosiak. Notably, Plaintiff’s counsel does not dispute that defense counsel attempted to meet and confer with him about the demurrer or that Defendant served a copy of the demurrer to Plaintiff’s counsel. The Court thus finds that Defendant has complied with the meet and confer requirement set forth under Code of Civil Procedure Section 430.41.

When considering demurrers, courts read the allegations liberally and in context. Wilson v. Transit Authority of City of Sacramento (1962) 199 Cal.App.2d 716, 720-21. 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 pleading alone, and not on the evidence or facts alleged.” E-Fab, Inc. v. Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315. As such, the court assumes the truth of the complaint’s properly pleaded or implied factual allegations. Id. However, it does not accept as true deductions, contentions, or conclusions of law or fact. Stonehouse Homes LLC v. City of Sierra Madre (2008) 167 Cal.App.4th 531, 538.

1. Whether Plaintiff has Standing To Sue

Unlike a corporation, a trust is not a legal entity and lacks standing to sue or be sued. Galdjie v. Darwish (2003) 113 Cal.App.4th 1331, 1343. “Where a cause of action is prosecuted on behalf of an express trust, the trustee is the real party in interest because the trustee has legal title to the cause.” Saks v. Damon Raike & Co. (1992) 7 Cal.App.4th 419, 427. When an action is mistakenly brought in the name of a trust, courts liberally allow amendments to permit substitution of the trustee as plaintiff. Jo Redland Trust, U.A.D. 4-6-05 v. CIT Bank, N.A. (2023) 92 Cal.App.5th 142, 149. “A trust terminates when it is revoked. On termination of the trust, the trustee continues to have the powers reasonably necessary under the circumstances to wind up the affairs of the trust. The winding up process involves distribution and conveyance of the trust property to those entitled to it.” Sterling v. Sterling (2015) 242 Cal.App.4th 185, 200 (citations omitted) (internal quotation marks omitted).

Here, the complaint names both RJRP Family Trust Dated 5/8/1995 (the trust) and Richard J. Rosiak, as settlor and trustee, as plaintiffs. However, because a trust is not a legal entity and lacks the capacity to sue and be sued, Richard is the only plaintiff in this action. See Galdjie v. Darwish supra, 113 Cal.App.4th at 1343.

The Court judicially notices the revocation of the trust. RJN #1; RJN #2 at p. 99 ¶ 54.2 This judicially noticed fact completely contradicts Rosiak’s bald assertion that the trust was not revoked. However, just because the trust was revoked does not necessarily mean that Plaintiff lacks standing to sue as trustee. To the extent the suit is reasonably necessary to distribute trust property, Plaintiff has standing as trustee to bring it.

2. Whether Plaintiff’s Cause of Action is Barred by Collateral Estoppel

Where “all of the facts necessary to show that an action is barred by [collateral estoppel] are within the complaint or subject to judicial notice, a trial court may properly sustain a general demurrer.” Shine v. Williams-Sonoma, Inc. (2018) 23 Cal.App.5th 1070, 1076-1077.

“Collateral estoppel, or issue preclusion, ‘precludes relitigation of issues argued and decided in prior proceedings.’” Gabriel v. Wells Fargo Bank, N.A. (2010) 188 Cal.App.4th 547, 556 (quoting, Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896). “Collateral estoppel precludes the relitigation of an issue only if (1) the issue is identical to an issue decided in a prior proceeding; (2) the issue was actually litigated; (3) the issue was necessarily decided; (4) the decision in the prior proceeding is final and on the merits; and (5) the party against whom collateral estoppel is asserted was a party to the prior proceeding or in privity with a party to the prior proceeding.” Zevnik v. Superior Court (2008) 159 Cal.App.4th 76, 82, 70 Cal.Rptr.3d 817.

“[A] decree of divorce which does not adjudicate or dispose of property interests does not bar a subsequent suit. On the other hand, a decree which does adjudicate property rights and makes a division is final as to the property which is actually divided.” Lewis v. Superior Court (1978) 77 Cal.App.3d 844, 847.

All requirements for collateral estoppel are present here. The four properties Plaintiff seeks to quiet title to were previously the subject of divorce proceedings between Plaintiff and Defendant in Nevada. RJN #2. The ownership of the properties, as between Plaintiff, both individually and as trustee, and Defendant was actually litigated and necessarily decided. RJN #2 p. 96-99, ¶¶ 44-54, p. 124. As determined by the Nevada court, the 2012 transfer of the three properties on Villa De Conde Way to the trust was void. RJN #2 p. 99, ¶ 54. In dividing the marital assets, the Nevada court awarded Defendant a 100% interest in each of the four properties at issue here. RJN #2 p.124. Because the Nevada divorce proceeding is final, on the merits, and Plaintiff was a party to that proceeding he is precluded from relitigating the issue here. Accordingly, the Court sustains Defendant’s demurrer.

Rosiak’s declaration does not dispute that the Nevada court already adjudicated the ownership of the properties he seeks to relitigate in this action. He instead asserts that Defendant did not serve the demurrer on him. As noted above, Plaintiff is represented by counsel and thus Defendant properly served Plaintiff’s counsel with the demurrer. The proof of service attached to the demurrer demonstrates proper service and the Court does not find credible Rosiak’s assertion that defense counsel “fabricated” the service of the demurrer and attempt to meet and confer. The Court declines both parties’ requests for sanctions.