Judge: Anne Hwang, Case: 20STCV25715, Date: 2023-11-14 Tentative Ruling

Case Number: 20STCV25715    Hearing Date: February 21, 2024    Dept: 32

PLEASE NOTE:   Parties are encouraged to meet and confer concerning this tentative ruling to determine if a resolution may be reached.  If the parties are unable to reach a resolution and a party intends to submit on this tentative ruling, the party must send an email to the Court at sscdept32@lacourt.org indicating that party’s intention to submit.  The email shall include the case number, date and time of the hearing, counsel’s contact information (if applicable), and the identity of the party submitting on this tentative ruling.  If the Court does not receive an email indicating the parties are submitting on this tentative ruling and there are no appearances at the hearing, the Court may place the motion off calendar or adopt the tentative ruling as the order of the Court.  If all parties do not submit on this tentative ruling, they should arrange to appear in-person or remotely.  Further, after the Court has posted/issued a tentative ruling, the Court has the inherent authority to prohibit the withdrawal of the subject motion and adopt the tentative ruling as the order of the Court. 

TENTATIVE RULING

BACKGROUND

On July 8, 2020, Plaintiff Laura Castaneda, through guardian ad litem Esther Mendoza (“Plaintiff”) filed a complaint against Defendants Aaron’s Towing, Inc., John Doe 1, John Doe 2, and Does 3 to 100. Plaintiff alleges that she suffers from cerebral palsy and on July 12, 2018, was in the back seat of her mother’s parked car. Plaintiff alleges that tow truck operators (Doe 1 and Doe 2) attempted to tow the car while Plaintiff was inside, causing injuries to Plaintiff.

On April 21, 2023, Plaintiff passed away.

On October 23, 2023, Plaintiff filed the instant motion to amend the complaint to reflect Plaintiff’s death, and name Plaintiff’s mother, Esther Mendoza, as successor in interest. Plaintiff also seeks to add Defendant A7 Towing to the complaint as the “alter ego” of Aaron’s Towing, Inc., which is dissolved. Trial is currently set for April 19, 2024. No opposition has been filed.  

LEGAL STANDARD

Amendment to Pleadings: General Provisions

Under Code of Civil Procedure section 576, “[a]ny judge, at any time before or after commencement of trial, in the furtherance of justice, and upon such terms as may be proper, may allow the amendment of any pleading or pretrial conference order.”

Code of Civil Procedure section 473, subdivision (a)(1) provides, in relevant part: “[t]he court may, in furtherance of justice, and on any terms as may be proper, allow a party to amend any pleading or proceeding by adding or striking out the name of any party, or by correcting a mistake in the name of a party, or a mistake in any other respect; and may, upon like terms, enlarge the time for answer or demurrer.¿ The court may likewise, in its discretion, after notice to the adverse party, allow, upon any terms as may be just, an amendment to any pleading or proceeding in other particulars; and may upon like terms allow an answer to be made after the time limited by this code.”¿ 

“This discretion should be exercised liberally in favor of amendments, for judicial policy favors resolution of all disputed matters in the same lawsuit.”¿(Kittredge Sports Co. v. Superior Court¿(1989) 213 Cal.App.3d 1045, 1047.)¿ The Court of Appeal in Morgan v. Superior Court held “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 and where the refusal also results in a party being deprived of the right to assert a meritorious cause of action or a meritorious defense, it is not only error but an abuse of discretion.”  (Morgan v. Superior Court (1959) 172 Cal.App.2d 527, 530, citations omitted.)  Moreover, “it is an abuse of discretion for the court to deny leave to amend where the opposing party was not misled or prejudiced by the amendment.”  (Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048 [opposing party did not establish harm by the delay in moving to amend the complaint].)

“The court may grant leave to amend the pleadings at any stage of the action.” (Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2022) ¶ 6:636 (hereafter Weil & Brown).)  Denial of a motion to amend is rarely justified if the motion is timely made and granting the motion will not prejudice the opposing party. (Id. at ¶ 6:639, citations omitted.)  However, if the party seeking the amendment has been dilatory, and the delay has prejudiced the opposing party, the judge has discretion to deny leave to amend. (Id. at ¶ 6:655, citations omitted. Absent prejudice, any claimed delay alone is not grounds for denial. “If the delay in seeking the amendment has not misled or prejudiced the other side, the liberal policy of allowing amendments prevails. Indeed, it is an abuse of discretion to deny leave in such a case even if sought as late as the time of trial. (Id. at ¶ 6:653 (citing Higgins v. Del Faro (1981) 123 Cal.App.3d 558, 564-565).)  “Prejudice exists where the amendment would result in a delay of trial, along with loss of critical evidence, added costs of preparation, increased burden of discovery, etc.  . . .  But the fact that the amendment involves a change in legal theory which would make admissible evidence damaging to the opposing party is not the kind of prejudice the court will consider.”  (Weil & Brown, supra, at ¶ 6:656, citations omitted.)

“Even if some prejudice is shown, the judge may still permit the amendment but impose conditions, as the Court is authorized to grant leave ‘on such terms as may be proper.’”  (Weil & Brown, supra, at ¶ 6:663, citation omitted.)  For example, the court may cause the party seeking the amendment to pay the costs and fees incurred in preparing for trial. (Id. at ¶ 6:664 (citing Fuller v. Vista Del Arroyo Hotel, 42 Cal.App.2d 400, 404).)

California Rules of Court, rule 3.1324:  Procedural Requirements

Pursuant to California Rules of Court, rule 3.1324(a), a motion to amend a pleading before trial must:

“(1) Include a copy of the proposed amendment or amended pleadings, which must be serially numbered to differentiate it from previous pleadings or amendments;

(2) state what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph, and line number, the deleted allegations are located; and

(3) State what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located.”

In addition, under Rule 3.1324(b), a motion to amend a pleading before trial must be accompanied by a separate declaration that specifies the following:

“(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.”

DISCUSSION

As an initial matter, although the declaration in support does not state when the amended allegations were discovered, or the reasons why they were not made earlier, Plaintiff has satisfied the other procedural requirements. Accordingly, the Court exercises its discretion to consider the motion.

Successor in Interest

First, Plaintiff moves to amend in order to name Esther Mendoza as Plaintiff’s successor in interest.

California Code of Civil Procedure section 377.31 provides that the decedent’s personal representative or, if none, the decedent’s successor in interest may continue a decedent’s pending action. (Code Civ. Proc., § 377.30; see Adams v. Superior Court (2011) 196 Cal.App.4th 71, 78-79.) A successor in interest is the beneficiary of the decedent’s estate or other successor in interest who succeeds to a cause of action or to a particular item of the property that is the subject of the cause of action. (Code Civ. Proc., § 377.11.) Section 377.33 provides that the court in which an action is continued may make any order concerning parties that is appropriate to ensure proper administration of justice, including the appointment of the decedent’s successor in interest as a special administrator or guardian ad litem. 

Section 377.32 provides that a person who seeks to commence such an action as the decedent’s successor in interest must file an affidavit or declaration providing certain information, including the decedent’s name, date and place of decedent’s death, and statements regarding whether the estate has been administered and that the affiant or declarant is the successor in interest on decedent’s claim. (Id., § 377.32(a).) A certified copy of the decedent’s death certificate must also be attached to the affidavit or declaration. (Id., § 377.32(c).)

            Plaintiff did not file a motion to substitute under section 377.31. Nevertheless, Plaintiff provides the following information:

Plaintiff passed away on April 21, 2023. A certified copy of Plaintiff’s death certificate has been attached. (Mendoza Decl. ¶ 3, Exh. A.) The Court finds that Esther Mendoza has filed a declaration, under penalty of perjury, that she is Plaintiff’s successor in interest to Plaintiff’s interest in this action. Therefore, Esther Mendoza has satisfied the requirements for continuing the decedent Plaintiff’s action.

Additional Defendant

Plaintiff also seeks to add as defendant, A7 Towing, Inc. as the alter ego of Aaron Towing, Inc. Each share the same corporate address. (Burns Decl. ¶ V.) Aaron Towing, Inc. filed a Certificate of Dissolution on April 12, 2021 during the pendency of this action. (Id. ¶ IX.)

The doctrine of joint enterprise, or alter ego liability, is applied when one corporation uses another to perpetrate fraud, circumvent a statute, or accomplish some other wrongful or inequitable purpose. In these situations, a court may disregard the corporate entity and treat the corporation's acts as if they were done by the persons actually controlling the corporation. [Citation.] ‘Because society recognizes the benefits of allowing persons and organizations to limit their business risks through incorporation, sound public policy dictates that imposition of alter ego liability be approached with caution.’ [Citation.] Indeed, ‘the corporate form will be disregarded only in narrowly defined circumstances.’ [Citation.]” (Gopal v. Kaiser Foundation Health Plan, Inc. (2016) 248 Cal.App.4th 425, 431.) “Generally, alter ego liability is reserved for the parent-subsidiary relationship. However, under the single-enterprise rule, liability can be found between sister companies.” (Las Palmas Associates v. Las Palmas Center Associates (1991) 235 Cal.App.3d 1220, 1249.)

“Two conditions are generally required for the application of joint enterprise liability: (1) such a unity of interest and ownership that the separate corporate personalities are merged, so that one corporation is a mere adjunct of another or the two companies form a single enterprise, and (2) an inequitable result if the acts in question are treated as those of one corporation alone. [Citation.]” (Gopal, supra, 248 Cal.App.4^th at 431.) “Factors for the trial court to consider include the commingling of funds and assets of the two entities, identical equitable ownership in the two entities, use of the same offices and employees, disregard of corporate formalities, identical directors and officers, and use of one as a mere shell or conduit for the affairs of the other. No one characteristic governs, but the courts must look at all the circumstances to determine whether the doctrine should be applied.” (Toho-Towa Co., Ltd. v. Morgan Creek Productions, Inc. (2013) 217 Cal.App.4th 1096, 1108–09 [internal citations omitted].)

Here, Plaintiff has shown that the proposed defendant shares the same address as Aaron Towing, Inc. and that Aaron Towing, Inc. was dissolved during the pendency of this action. Therefore, given the liberal policy of allowing amendments, and seeing no opposition, the motion for leave to amend is granted.

CONCLUSION AND ORDER

Accordingly, Plaintiff’s motion for leave to amend their complaint is granted. Plaintiff shall file and serve the amended complaint within 10 days.

Plaintiff to provide notice and file a proof of service of such.