Judge Anne Hwang, Case Number: 22STCV01539, Date: 2023-08-15 Tentative Ruling

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 (which is highly encouraged). 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.

Plaintiff Francisco Ramirez (“Plaintiff”) filed this action against Defendant Dena Holdings, LLC (“Defendant”) for premises liability for a slip and fall incident that Plaintiff suffered when he fell down a flight of stairs at Defendant’s premises. Defendant now moves the Court to dismiss this action on the grounds that Plaintiff lacks standing, this action was filed for improper purpose and to perpetuate an ongoing fraud, Plaintiff’s allegations have no evidentiary support, and this action is barred under the doctrine of unclean hands. Plaintiff opposes the motion. Defendant has filed a reply.

Plaintiff moves for leave to file an amended complaint alleging Plaintiff’s true name as an “aka.” Defendant opposes the motion. Plaintiff has filed a reply.

Defendant’s grounds for moving to dismiss this action are that Plaintiff, whose true name is Pascual Cotiy Tambriz (“Tambriz”),[1] engaged in fraudulent conduct when he filed this lawsuit under the fraudulent identity of “Francisco Ramirez,” who was “made up” by Tambriz, and is a person that does not exist.[2] (Cordova Decl., Exh. D, 12:4-22, 13:3-18, 16:3-10, 96:15-20.) In response to discovery, Tambriz represented that the only name he had ever used was Plaintiff’s name. (Id., Exh. B.) At deposition and in response to discovery requests, Plaintiff admitted to making up Plaintiff’s identity, which includes a false birthdate and social security number, in order to receive Medi-Cal benefits. (Id. Exh. D, 12:4-22, 13:3-18, 16:3-10, 96:15-20.) He further admitted to falsifying at least one social security number on his employment records and receiving payments. (Id.)

Defendant first moves to dismiss this action on the grounds that “Francisco Ramirez” lacks standing. Separately, Plaintiff moves for leave to amend to “correct” Plaintiff’s name to “Francisco Ramirez aka Pascual Cotiy Tambriz.”

“A lack of standing is a jurisdictional defect to an action that mandates dismissal.” (Cummings v. Stanley (2009) 177 Cal.App.4th 493, 501.)

Under Code of Civil Procedure section 473, subdivision (a)(1), “The 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.”

To wit, without notice to the other party the Court has wide discretion to allow either party (i) to add or strike the name of a party or (ii) to correct a mistake in the name of a party or a mistake in any other respect “in furtherance of justice” and “on any terms as may be proper.” (See Code Civ. Proc., § 473, subd. (a)(1); see also Marriage of Liss (1992) 10 Cal.App.4th 1426, 1429.) Alternatively, after notice to the other party, the Court has wide discretion to allow either party to amend pleadings “upon any terms as may be just.” (See Code Civ. Proc., § 473, subd. (a)(1).) Similarly, Code of Civil Procedure section 576 states “Any 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.”

Judicial policy favors resolution of all disputed matters between the parties and, therefore, leave to amend is liberally granted. (Berman vs. Bromberg (1986) 56 Cal.App.4th 936, 945; Hirsa v. Superior Court (1981) 118 Cal.App.3d 486, 488-489 [this has been an established policy in California since 1901] (citing Frost v. Whitter (1901) 132 Cal. 421, 424; Thomas v. Bruza (1957) 151 Cal.App.2d 150, 155).) 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].)

“Trial courts are vested with the discretion to allow amendments to pleadings ‘in furtherance of justice.’ That trial courts are to liberally permit such amendments, at any stage of the proceeding, has been established policy in this state since 1901.” (Hirsa v. Superior Court (Vickers) (1981), 118 Cal.App.3d 486, 488-89 (citations omitted) (emphasis in original).) However, “[a] different result is indicated ‘[w]here inexcusable delay and probable prejudice to the opposing party’ is shown.” (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 487 (citations omitted).)

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:

The Court agrees with Defendant that “Francisco Ramirez” lacks standing to assert a cause of action for premises liability, as he is a fictitious person, and the person who allegedly suffered an injury on the date of the subject incident was Tambriz. (Cordova Decl., Exh. D, 19:21-20:6, 35:23-41:3.) However, while “Francisco Ramirez” cannot prosecute this action, Tambriz may prosecute this action under his true name, as he is the person who suffered an injury and has the right to sue. (See Code Civ. Proc., § 367; Gantman v. United Pac. Ins. Co. (1991) 232 Cal.App.3d 1560, 1566.) California courts have liberally allowed substitution of plaintiffs when it has been determined they lack standing. (Branick v. Downey Savings & Loan Assn. (2006) 39 Cal.4th 235, 243 [“[California] courts have permitted plaintiffs who have been determined to lack standing, or who have lost standing after the complaint was filed, to substitute as plaintiffs the true real parties in interest.”])

Defendant argues that leave to amend should be denied because Plaintiff unreasonably delayed in seeking relief, that Plaintiff’s excuses for using a fake identity are untenable, and that Defendant will suffer undue prejudice. Plaintiff’s counsel replies that he discovered his client’s true identity in September 2022 and in December 2022, he attempted to meet and confer to obtain a stipulation to amend the complaint. He then reserved a hearing date for a motion to amend the complaint on December 22, 2022. Plaintiff further argues that Defendant will not suffer prejudice because to date, Defendant has not served subpoenas, and has only propounded one set of form interrogatories, special interrogatories, request for admissions, and request for documents.

The Court finds that Defendant’s effort to amend the complaint was timely, notwithstanding his inability to have his motion heard earlier. Moreover, trial in this matter is set for February 29, 2024, giving the parties sufficient time to conduct discovery. To the extent that discovery is limited to what has been described in Plaintiff’s reply brief, the Court finds that while there may be some added costs of preparation and increase in discovery burdens, those costs and increases are minimal.

Taking into account the liberal policy of allowing plaintiffs to substitute into cases, the Court DENIES Defendant’s Motion to Dismiss on the ground of lack of standing and GRANTS Plaintiff’s motion to amend the complaint. However, there appears to be no basis to maintain the Plaintiff’s name as “Francisco Ramirez,” even if an “aka” is alleged, given that it appears undisputed that Francisco Ramirez is not Plaintiff’s true identity. Accordingly, the Court will permit Plaintiff to amend to allege his true identity. To the extent that there are different spellings for that name, those different spellings should be alleged as an “aka,” along with “Francisco Ramirez” and any other identities used by Plaintiff.

Defendant contends that Tambriz’s claim is barred by the doctrine of unclean hands because Tambriz admitted that he committed actual fraud when he created a false identity and used that same identity to file the instant lawsuit.[3] Defendant further argues that it has been put on notice of a Medi-Cal lien for treatment related to alleged injuries from the incident under the name of Francisco Ramirez. Moreover, Defendant contends that Plaintiff will not be able to meet his burden as all the evidence “is under a separate identity with no legal or authorized ties to Pascual Tambriz.” (Motion at pg. 11.) Defendant further argues that Plaintiff’s deposition testimony “is riddled with additional inconsistencies that cannot be reconciled,” including when he started using the fake name, who lived with him, and his current employment status. (Motion at pgs. 6-8.) “As Plaintiff’s damages in this matter are inextricably intertwined with his continued fraud, to allow Plaintiff to proceed with this matter would not only allow his fraud to continue but potentially reward Plaintiff for his actions by allowing him to additionally recover in a court of law.” (Motion at pg. 11.)

Tambriz contends that his conduct of using an “alias” to seek medical treatment and filing his Compliant has nothing to do with whether Tambriz slipped and fell, and that the use of an alias should not give Defendant a “free pass” for its negligent conduct. While the majority of the opposition presents arguments regarding the issuance of sanctions, Plaintiff argues that he “like many immigrants to this Country, adopted an alias to avoid immigration issues. To avoid confusion, Plaintiff wishes to amend his complaint to reflect his legal name in Guatemala as well as the name he uses in the United States.” (Opp. at pg. 1.) “The incorrect name does not prejudice defendants in anyway, i.e., they have been able to retrieve all medical records and investigate the claim properly. (Opp. at pg. 3.)

“The [unclean hands] doctrine demands that a plaintiff act fairly in the matter for which he seeks a remedy. He must come into court with clean hands ... or he will be denied relief, regardless of the merits of his claim. The doctrine of unclean hands requires unconscionable, bad faith, or inequitable conduct by the plaintiff in connection with the matter in controversy. Unclean hands applies when it would be inequitable to provide the plaintiff any relief, and provides a complete defense to both legal and equitable causes of action. The plaintiff's misconduct must be of such a prejudicial nature that it would be unfair to grant him the relief he seeks in court. Whether the defense applies in particular circumstances depends on the analogous case law, the nature of the misconduct, and the relationship of the misconduct to the claimed injuries. The defense applies only where it would be inequitable to grant the plaintiff any relief. The decision of whether to apply the defense based on the facts is a matter within the trial court's discretion.” (Bank of America, N.A. v. Roberts (2013) 217 Cal.App.4th 1386, 1400.)

“Although the venerable unclean-hands defense has been described in many iterations, courts have developed and now consistently apply a ‘three-pronged test to determine the effect to be given to the plaintiff’s unclean hands conduct. Whether the particular misconduct is a bar to the alleged claim for relief depends on (1) analogous case law, (2) the nature of the misconduct, and (3) the relationship of the misconduct to the claimed injuries.’” (Padideh v. Moradi (2023), 89 Cal.App.5th 418, 426 (quoting Kendall-Jackson Winery, Ltd. V. Superior Court (1999) 76 Cal.App.4th 970, 979.) “As to the second prong – the nature of the misconduct – a plaintiff’s actions giving rise to the unclean-hands defense ‘need not be a crime or actionable tort. Any conduct that violates good conscience, or good faith, or other equitable standards of conduct is sufficient to invoke the doctrine.’” (Id. (citation omitted.) As to the third prong, the unclean hands “must relate directly to the transaction concerning which the … complaint is made. It must infect the cause of action involved and affect the equitable relations between the litigants. Still, the defense ‘goes beyond the justification for filing the […] suit; unclean hands concerns the far broader questions of a party’s misconduct in the matter.” (Id. (citation and quotations omitted).)

“[T]he improper conduct must be ‘in the particular transaction or connected with the subject matter of the litigation that is a defense.’” (Brown v. Grimes (2011) 192 Cal.App.4th 265, 282 (citation and quotation omitted) (unclean hands did not apply because the inequitable conduct did not occur in the transaction to which the relief sought relates).) “The question is whether the unclean conduct relates directly ‘to the transaction concerning which the complaint is made,’ i.e., to the ‘subject matter involved’ and not whether it is part of the basis upon which liability is being asserted.” (Peregrine Funding, Inc. v. Sheppard Mullin Richter & Hampton, LLP (2005) 133 Cal.App.4th 658, 681 (citations and quotation omitted, alteration in original).)

This Court does not “countenance the giving of willfully false testimony. Such conduct is anathema to our system of justice which depends upon truthful testimony in the determination of legal rights and liabilities, of guilt or innocence.” (Collins v. Superior Court (2001) 89 Cal.App.4th 1244, 1248.) However, while Defendant has presented sufficient evidence that Plaintiff provided false information and filed the case under a false identity, Defendant has not established analogous case law (prong 1) or the relationship of the misconduct to the claimed injuries (prong 3).

Accordingly, the motion to dismiss based on unclean hands is DENIED without prejudice.

Code of Civil Procedure section 128.7 states that the Court may impose sanctions on an unrepresented party or attorney that presents a pleading, petition, motion, or other similar papers in the following circumstances:¿

1) the document is presented primarily for an improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.¿¿

2) the claims, defenses, and other legal contentions therein are not warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law.¿¿

3) the allegations and other factual contentions have no evidentiary support;¿¿

Section 128.7 permits the Court to impose monetary sanctions on an attorney or an unrepresented party that violates any one of these requirements.¿¿(Eichenbaum¿v. Alon¿(2003) 106 Cal.App.4th 967, 976.)¿¿Additionally,¿Code of Civil Procedure¿§¿128.7 does not require a¿finding of subjective bad¿faith, but¿it¿only¿requires¿a finding¿that the conduct¿is¿objectively unreasonable.¿¿(In re Marriage of Reese & Guy¿(1999) 73 Cal.App.4th 1214, 1221.)¿¿

¿ Under¿Code of Civil Procedure¿§¿128.7, a¿court¿may¿impose sanctions if it concludes a pleading was filed for an improper purpose or was indisputably without merit, either legally or factually.¿¿(Bucur v. Ahmad¿(2016) 244 Cal.App.4th 175, 189-90.)¿¿A claim is factually frivolous if it is “not well grounded in fact” and is legally frivolous if it is “not warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law.”¿¿(Id.)¿¿In either case, to obtain¿sanctions, the moving party must show the party's conduct in asserting the claim was objectively unreasonable.¿¿(Id.)¿¿A claim is objectively unreasonable if “any reasonable attorney would agree that [it] is totally¿and completely without merit.”¿¿(Id.)¿¿However, “section 128.7 sanctions¿should be ‘made with restraint,’¿and are not mandatory¿even if a claim is frivolous.”¿¿(Peake v. Underwood¿(2014) 227 Cal.App.4th 428. at 448.)¿¿

The Legislature enacted section 128.7 based on rule 11 of the¿Federal Rules of Civil Procedure (“FRCP”) Rule 11.¿¿(Musaelian¿v. Adams¿(2009) 45 Cal.4th 512, 518, fn. 2.)¿¿As a result,¿federal case law construing FRCP Rule 11 is persuasive authority on the meaning of¿Code of Civil Procedure¿§¿128.7.¿¿(Guillemin v. Stein¿(2002) 104 Cal.App.4th 156, 168.)¿¿Under FRCP Rule 11, even though an action may not be frivolous when it is filed, it may become so if later-acquired evidence refutes the findings of a prefiling investigation and the attorney continues to file papers¿supporting the client's claims.¿¿(Childs v. State Farm Mut. Auto. Ins. Co. 29 F.3d 1018, 1025 (5th Cir. 1994).)¿ As a result, a plaintiff's attorney cannot “just cling tenaciously to the investigation he had done at the outset of the litigation¿and bury his head in the sand.”¿¿(Id.)¿ This requires an attorney to¿conduct a reasonable inquiry to determine if his or her client's claim was well-grounded in fact¿and to take¿into account the adverse party's evidence.¿¿(Id.)¿¿

In addition, Code of Civil Procedure¿§¿128.7(c)(1)¿requires¿that a motion for sanctions be made separately from other motions and that notice of the motion must be served, but not filed with the Court, unless, within 21 days after service of the motion, the challenged paper is not withdrawn.¿ This 21-day time period is known as a "safe harbor" period and its purpose is to permit an offending party to avoid sanctions by withdrawing the improper pleading¿during the safe harbor period.¿¿(Li v. Majestic Industry Hills LLC¿(2009) 177 Cal. App. 4th 585, 591.)¿ This permits a party to withdraw a questionable pleading without penalty, thus saving the court and the parties time and money litigating the pleading as¿well as the sanctions request.¿¿(Id.)¿ “[N]otice¿of motion shall be served as provided in Section 1010, but shall not be filed with or presented to the court unless, within 21 days after service of the motion, or any other period as the court may prescribe, the challenged paper, claim defense, contention, allegation, or denial is not withdrawn or appropriately corrected.”¿ (Code of Civ. Proc. §128.7(c)(1).)¿ “Notices must be in writing, and the notice of a motion, other than for a new trial, must state when, and the grounds upon which it will be made, and the papers, if any, upon which it is to be based.¿ If any such paper has not previously been served upon the party to be notified and was not filed by him, a copy of such paper must accompany the notice.”¿ (Code of Civ. Proc. § 1010.)¿

As a preliminary matter, Tambriz contends that Defendant failed to comply with the 21-day safe harbor rule because Defendant did not submit evidence of when the motion was served on Tambriz, but a review of Defendant’s counsel’s declaration in support of the motion reveals that the motion was served on Tambriz on April 18, 2023, and filed with the Court on May 11, 2023, which complies with the 21-day safe harbor rule. (Cordova Decl., ¶ 8.)

Defendant seeks to have sanctions issued against Tambriz’s attorney in the amount of $1,421.61 (which represents 8 hours of work on this motion at a rate of $170/hour plus a $61.61 filing fee). (Cordova Decl., ¶¶ 8-9.) Defendant represents it was forced to file this motion after Plaintiff did not withdraw the Complaint during the 21-day safe harbor period after Defendant had served the instant motion on him, but before it was filed with the Court. (Id.)

In light of the Court’s denial of the motion to dismiss, sanctions pursuant to section 128.7 are not warranted.[4]

Plaintiff’s Motion for Leave to File First Amended Complaint is GRANTED in part, in that Plaintiff may file an amended complaint alleging the true identity of Plaintiff, along with prior identities used by Plaintiff.

Defendant shall provide notice of this order and file a proof of service of such.

[1] Defendant argues even this is unclear, as the name has been spelled differently in different contexts.

[2] Defendant argues that the identity could be stolen, but there is no such evidence currently before the Court.

[3] Defendant also argues that Plaintiff knowingly filed this case to try to mislead the Court to seek benefits to which Francisco Ramirez is not entitled. (Motion at pg. 9.) The motion does not cite any authority for its request that the Court dismiss the action on the basis that Plaintiff filed this complaint for an improper purpose and that the complaint contains false statements, other than generally Code of Civil Procedure §§ 581(m) and 128.7. In some egregious circumstances, dismissal may be the only viable sanction, and the Court has the power to issue terminating sanctions for “pervasive misconduct.” (Stephen Slesinger, Inc. v. Walt Disney Co. (2007) 155 Cal.App.4th 736, 765 (investigator trespassed to take confidential documents from opposing party then altered documents with intent to mislead).) However, the Court cannot find that Plaintiff’s misconduct here - while significant - is pervasive, particularly given’s counsel’s effort to amend the complaint. (Cf. Guardianship of A.H. (2022) 83 Cal.App.5th 155, 160.) “[D]ismissal is always a drastic remedy to be employed only in the rarest of circumstances.” (Id. at 160-61 (citation omitted).)

[4] The Court does not address any other possible grounds for monetary sanctions because the motion does not provide notice of a request for monetary sanctions under any other provision of the Code of Civil Procedure. However, the denial of the request for sanctions in no way expresses an opinion about the seriousness of Plaintiff’s conduct. Plaintiff’s counsel’s attempt to justify Plaintiff’s conduct both in this court and throughout the litigation is unavailing.

DEPARTMENT	32
HEARING DATE	August 15, 2023
CASE NUMBER	22STCV01539
MOTIONS	(1) Dismiss and Request for Sanctions (2) Leave to Amend Complaint
MOVING PARTY	(1) Defendant/Cross-Complainant Dena Holdings, LLC (2) Plaintiff Francisco Ramirez
OPPOSING PARTY	(1) Plaintiff Francisco Ramirez (2) Defendant/Cross-Complainant Dena Holdings, LLC