Judge: Anne Richardson, Case: 21STCV12559, Date: 2023-05-16 Tentative Ruling

Case Number: 21STCV12559    Hearing Date: May 16, 2023    Dept: 40

Superior Court of California

County of Los Angeles

Department 40

MOVING PARTY:              Defendants Atlantic Park Plaza, LLC, Yehezkel Hezi Kashanian, and Javid Somekh.

OPPOSITION:                      Plaintiffs Mehran Haghani and Khanoum Agha Akhavan.

Background

Undisputed Facts Summarizing Litigation Background (Based on SAC’s Pleadings)

Based on misrepresentations by Defendants Atlantic Park Plaza, LLC, Yehezkel Hezi Kashanian, and Javid Somekh (Defendants), on or about April 15, 2005, Plaintiffs Mehran Haghani and Khanoum Agha Akhavan and Defendants purchased real property as tenants-in-common.

On or about April 2007, Defendants Javid and Hezi told Plaintiffs that they were desperately in need of capital and pleaded with Plaintiffs to temporarily transfer their ownership interest in the property to Defendants so that Defendants could offer the property as collateral to a lender in exchange for a loan on the property. Defendants promised Plaintiffs that Defendants would transfer back to Plaintiffs their 26% ownership interest in the property after the bank issued Defendants the loan.

Plaintiffs became increasingly frustrated with Defendants, and on or about February 8, 2009, presented Defendants with an ultimatum to transfer back to Plaintiffs their original ownership interest in the property or face litigation.

In response to Plaintiffs’ grievances, on or about March 5, 2009, the parties set up an informal mediation and designated non-attorney intermediaries in the Persian-Jewish community with expertise in real estate to mediate the parties’ disputes. All Defendants were present at this meeting. The non-attorney intermediaries present at the meeting were Rahim Golbari, Frank Rad, and Habib Saghezi.

The meeting concluded when the parties agreed that Defendants would pay Plaintiffs $1.5 million over a 36-month period in consideration for the 26% interest of the Property that Plaintiffs transferred to Defendants. The parties also agreed that Defendants Javid “Mousa” Somekh and Yehezkel “Hezi” Kashanian would personally guarantee the payments. (Collectively, the Agreement.)

In or around June 2012, the Property was sold by Defendants to South Gate Tweety, LLC for $3,010,000.

After the signing of the Agreement, in dozens of face-to-face meetings with mutual friends and respected non-attorney intermediaries in the Persian-Jewish community, as well as in telephone calls, Defendants reaffirmed their promise that they intended to perform under the Agreement. Nonetheless, Defendants failed to perform under the Agreement.

On or about August 21, 2019, during a meeting between Plaintiffs, Defendants, and several intermediaries, Defendants again reaffirmed their promise that they intended to perform under the Agreement and begged Plaintiffs to not file a lawsuit because Defendants intended to pay the outstanding debt called for in the Agreement within three months, warning that filing a lawsuit would only hinder Defendants’ ability to pay Plaintiffs.

On or about November 11, 2020, the last mediation between the parties occurred, during which, for the first time, Defendants indicated that they would not pay the monies called for in the Agreement, and that despite their previous promises to honor the Agreement, Plaintiffs are no longer entitled to enforce the Agreement on basis that it would be barred by statute of limitations.

(The Court notes that the Complaint, First Amended Complaint, and Second Amended Complaint all state that Defendants repudiated their promise to compensate Plaintiffs according to the terms of the Agreement on November 11, 2021. However, the Complaint was filed on April 1, 2021, i.e., before the alleged repudiation date. As a result, November 11, 2021 cannot be, based on the history of the pleadings, the date of repudiation, as alleged therein. As a result, the Court adopts November 11, 2020 as the most reasonable repudiation date connoted by the Complaint, First Amended Complaint, and Second Amended Complaint collectively.)

Disputed Facts on Summary Judgment

The only disputed fact on summary judgment relates to the September 20, 2022 deposition of Plaintiff Mehran Haghani and whether Mr. Haghani’s testimony at that deposition proves that, contrary to the allegations in the Second Amended Complaint, Defendants never reaffirmed their promise to pay Plaintiffs $1.5 million according to the parties’ March 5, 2009 Agreement.

Plaintiffs dispute that Plaintiff Haghani’s deposition testimony proves that Defendants never reaffirmed their intent to comply with the March 5, 2009 Agreement on the ground that any testimony to that effect by Plaintiff Haghani was amended on November 14, 2022—i.e., allegedly within the statutory period for making such a change to deposition testimony. The amendment indicates that, due to translator error, the question that was asked at the deposition—whether Defendants ever renewed their promise to compensate Plaintiffs, to which Plaintiff Haghani answered with a “no”—was understood by Plaintiff Haghani to ask whether Defendants had ever entered into a different and new agreement with Plaintiffs to honor the March 5, 2009 Agreement. Plaintiff Haghani argues that his amended deposition answer amounts to testimony that, no, Defendants did not enter a new agreement with Plaintiffs regarding Defendants’ promise to compensate Plaintiffs in the amount of $1.5 million because Defendants instead reaffirmed their intent to comply with the terms of the original March 5, 2009 Agreement until November 11, 2020, when Defendants, for the first time, repudiated the Agreement.

Procedural History

On April 21, 2021, Plaintiffs Haghani and Akhavan sued Defendants Atlantic Plaza, Kashanian, and Somekh pursuant to claims of (1) Breach of Contract, (2) Breach of Personal Guaranty, (3) Fraud and Deceit, (4) Negligent Misrepresentation, and (5) Intentional Infliction of Emotional Distress (IIED), arising from allegations relating to (a) Defendants’ promise regarding the size of the shopping mall to be built by Defendants on the real property purchased by the parties, (b) Defendants’ promise to return to Plaintiffs their 26% interest in the Subject Property, and (c) Defendants’ promise to pay Plaintiffs under the terms of the March 5, 2009 agreement.

After several rounds of demurrers, on November 21, 2022, Plaintiffs Haghani and Akhavan filed a Second Amended Complaint (SAC), alleging the five causes of action pleaded in the original April 1, 2021 Complaint—(1) Breach of Contract, (2) Breach of Personal Guaranty, (3) Fraud and Deceit, (4) Negligent Misrepresentation, and (5)  IIED. The claims arose largely from the same allegations made in prior pleadings—the April 1, 2021 Complaint and September 21, 2021 First Amended Complaint—with the exception of references to the typewritten and unsigned agreement between the parties dated March 5, 2009.

On December 12, 2022, Defendants filed a summary judgment motion against the SAC’s five causes of action based on arguments related to the claims’ respective statute of limitations.

On December 14, 2022, Defendants demurred to the entire SAC based on sham pleading, to the SAC’s first two causes of action based on uncertainty and statute of frauds grounds, and to the SAC’s fifth cause of action based on Plaintiffs adding this claim back into the pleadings without leave of court.

On March 9, 2023, the Court overruled the demurrer to the SAC insofar as it challenged the SAC in its entirety based on sham pleading and insofar as it challenged the first two causes of action, but sustained the demurrer, without leave to amend, as to the IIED claim for failure to obtain leave of court to allege the IIED claim in the SAC.

On May 2, 2023, Plaintiffs opposed the summary judgment motion.

On May 5, 2023, Defendants replied to the May 2nd opposition.

The summary judgment motion is now before the Court. 

Request for Judicial Notice

Per Defendants’ request, the Court TAKES JUDICIAL NOTICE of the November 21, 2022 Second Amended Complaint. (Mot., RJN, p. 1, Ex. A.) 

Motion for Summary Judgment

Preliminary Notes

The Court briefly notes that the evidence that supports most of Defendants’ motion and separate statement consists of the allegations made by Plaintiffs in the SAC. (See Mot., Separate Statement generally.) Such evidentiary support is permitted. A party can use another party’s pleadings as evidence to support or oppose a motion for summary judgment or adjudication. (See Mark Tanner Constr., Inc. v. HUB Int’l Ins. Servs. (2014) 224 Cal.App.4th 574, 586; Food Safety Net Servs. v. Eco Safe Sys. USA, Inc. (2012) 209 Cal.App.4th 1118, 1126-1127.) This is because statements in an opponent’s pleadings are treated as judicial admissions. (Mark Tanner Constr., Inc. v. HUB Int’l Ins. Servs., supra, 224 Cal.App.4th at p. 586.) By contrast, a party cannot use its own pleadings as evidence to support or oppose a motion for summary judgment or adjudication. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849; see Code Civ. Proc., § 437c, subd. (p)(2); Moore v. Williams Jessup Univ. (2015) 243 Cal.App.4th 427, 433.)

Legal Standard

A motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. (Code of Civ. Proc., § 437c, subd. (c).) A party may also seek summary adjudication of an entire a cause of action or, under certain circumstances, parts thereof, which may be made by a standalone motion or as an alternative to a motion for summary judgment and proceeds in all procedural respects as a motion for summary judgment. (Code Civ. Proc., § 437c, subds. (f)(1)-(2), (t); see Lilienthal & Fowler v. Superior Court (1993) 12 Cal.App.4th 1848, 1854-1855, questioned by dictum in Bagley v. TRW, Inc. (1999) 73 Cal.App.4th 1092, 1094, fn. 2; see also Public Utilities Com. v. Superior Court (2010) 181 Cal.App.4th 364, 380.) The moving party bears the initial burden of production to make prima facie showing no triable material fact issues. (Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at p. 850.) This burden on summary judgment “is more properly one of persuasion rather than proof, since he must persuade the court that there is no material fact for a reasonable trier of fact to find, and not to prove any such fact to the satisfaction of the court itself as though it were sitting as the trier of fact.” (Id. at p. 850, fn. 11.) If the moving party meets this burden, the burden shifts to the opposing party to make converse prima facie showing that a triable issue of material fact exists. (Ibid.) The evidence of the moving party is strictly construed, and the evidence of the opposing party liberally construed. (Crouse v. Brobeck, Phleger & Harrison (1988) 67 Cal.App.4th 1509, 1524.) Doubts as to the propriety of granting the motion must be resolved in favor of the party resisting the motion. (Stationers Corp. v. Dun & Bradstreet, Inc. (1965) 62 Cal.2d 412, 417.)

I. Statute of Limitations Standard

“The proper remedy [for a statute of limitations argument against a claim] ‘is to ascertain the factual basis of the contention through discovery and, if necessary, file a motion for summary judgment ….’ [Citation.]” (Roman v. County of Los Angeles (2000) 85 Cal.App.4th 316, 325.)

Generally, a “statute of limitations begins to run when the plaintiff suspects or should suspect that her injury was caused by wrongdoing, that someone has done something wrong to her” (the “discovery rule”). (Bernson v. Browning–Ferris Industries (1994) 7 Cal.4th 926, 932.) “[A] cause of action accrues at ‘the time when the cause of action is complete with all of its elements.’” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 806-807.) However, if the complaint alleges wrongful conduct commencing at a time now barred by the statute of limitations, but continuing until a date not barred, the last overt act supporting the tort controls the trigger date for the statute of limitations. (See Wyatt v. Union Mortg. Co. (1979) 24 Cal.3d 773, 786 [holding that the statute of limitations on continuing tort cause of action does not begin to run until commission of last overt act].)

If the uncontradicted facts regarding the statute of limitations issues are susceptible to only one legitimate inference, summary judgment is proper. (Kline v. Turner (2001) 87 Cal.App.4th 1369, 1374.)

II. Discussion

SAC, First and Second Causes of Action, Statute of Limitations: DENIED.

The first and second causes of action alleged in the SAC plead Breach of Contract and Breach of Personal Guaranty against Defendants based on Defendants’ failure to abide by the terms of the March 5, 2009 Agreement. (SAC, ¶¶ 31-44, 45-57.)

In their motion, Defendants argue that these claims fail on summary judgment because material facts show that the claims are beyond their statute of limitations. (Mot., p. 8.)

Specifically, Defendants argue that the two claims are subject to a four-year statute of limitations, which lapsed before the original Complaint in this action was filed on April 1, 2021 because the Agreement at issue was entered into in 2009, and Plaintiff Haghani testified on September 20, 2022 that Defendants never reaffirmed their promise to pay the $1.5 million debt contemplated therein. (Mot., pp. 6-8.) For evidentiary support, Defendants refer to the SAC at paragraphs 16, 18, 19, and 25—pleadings related to when the limitations period began—as well as the deposition of Plaintiff Haghani. (See Mot., RJN, p. 1, Ex. A [copy of SAC]; see also Mot., Ex. E [relevant portion of deposition transcript at page 125, in which Plaintiff Haghani answered “no” to question as to whether Defendants ever renewed their promises to compensate Plaintiffs].)

Defendants also argue that a subsequent November 14, 2022 amendment to the deposition testimony by Plaintiff Haghani was improper because a deponent may only amend their deposition testimony within 30 days of the deposition officer providing written notice of the deposition transcript’s availability, and here, such notice was given by the deposition officer on October 13, 2022, with the 30-day deadline ending on November 12, 2022. (Mot., pp. 6-7.) For legal support, Defendants cite Code of Civil Procedure section 2025.520, subdivisions (a), (b), and (f). (Mot., pp. 6-7.) For evidentiary support, Defendants provide a relevant copy of the October 13, 2022 notice by the deposition officer, a copy of the November 14, 2022 amendment by Plaintiff Haghani, and a copy of the relevant portion of the September 20, 2022 transcript. (Mot., Exs. B [October 13, 2022 deposition availability notice], C [November 14, 2022 amendment to page 125, line 7], E [copy of September 20, 2022 deposition testimony, page 125].)

For the reasons explained by Plaintiffs in their opposition, the amendment argument fails and Defendants fail to carry their burden on summary judgment as to the first and second causes of action.

Code of Civil Procedure section 2025.520, subdivision (b) provides that “[f]or 30 days following [in relevant part] … notice … [of the availability of the deposition transcript], unless [an extension agreement is reached], the deponent may change the form or the substance of the answer to a question, and may either approve the transcript of the deposition by signing it, or refuse to approve the transcript by not signing it.”

However, Defendants’ time calculations are incorrect. If the deposition transcript was noticed as available on October 13, 2022 (Mot., Ex. B), then the 30-day period ended on Saturday, November 12, 2022, necessarily pushing the final date to amend the deposition to Monday, November 14, 2022. (Cal. Rules of Court, rule 1.10, subd. (b).) As such, the November 14, 2022 amendment by Plaintiff Haghani—which clarified that his deposition testimony was meant to indicate only that Defendants never entered into a new and distinct agreement to honor the Agreement to compensate Plaintiffs in the amount of $1.5 million, but rather, that Defendants reaffirmed promises to comply with the March 5, 2009 Agreement (Mot., Ex. C)—was timely.

If the November 14, 2022 amendment was timely, then Defendants fail to provide any evidence showing that Plaintiff Haghani ever testified that Defendants have never reaffirmed to Plaintiffs their promise to compensate Plaintiffs in the amount of $1.5 million. As a result, Defendants fail to provide evidence undercutting the SAC’s material allegations that Defendants reaffirmed their intent to abide by the terms of the Agreement up until November 11, 2020, when, per the SAC’s allegations, Defendants first repudiated their promise. (Compare SAC, ¶ 29 [alleging Defendants repudiated promises to compensate Plaintiffs on November 11, 2021], with Complaint, ¶ 26 [despite being filed on April 1, 2021, alleging Defendants repudiated promises to compensate Plaintiffs on November 11, 2021, best pointing to November 11, 2020 as repudiation date].) If the discovery date of injury or the last overt act by Defendants relating to Plaintiffs’ alleged injuries took place on November 11, 2020, then the filing of the Complaint on April 1, 2021 was well within the four-year statute of limitations for the SAC’s first two causes of action. (Code Civ. Proc., § 337, subd. (a) [four-year statute of limitations for contract claims].) As a result, because Defendants provide no evidence undercutting the allegations at paragraph 29 of the SAC related to discovery date/last overt act date and showing that the statute of limitations lapsed as to the first and second causes of action, summary judgment cannot be granted as to these claims. (See Juge v. County of Sacramento (1993) 12 Cal.App.4th 59, 66 [moving party must show that the undisputed facts, when applied to the issues framed by the pleadings, entitle the moving party to judgment].)

The Court does not find any arguments raised by Defendants in reply related to the application of California Rules of Court, rule 1.10 availing. (See Reply, pp. 1-3.) The law is clear that an obligation to perform landing on a weekend or holiday cannot be the end stop for a deadline to act. (See Cal. Rules of Court, rule. 1.10.)

Alternatively, even if the Court found that California Rules of Court, rule 1.10 was not applicable—which it does not—and that Defendants carried their burden on summary judgment—which they have not—the deposition officer’s notice of the availability of transcript was effected via email, which, per the Code of Civil Procedure, permits an additional two court days for a party to act, pushing the Saturday, November 12, 2022 deadline to Tuesday, November 15, 2022, which would carry Plaintiffs’ burden on summary judgment of the SAC’s first two causes of action. (See Opp’n, p. 8 [making this argument]; Code Civ. Proc., § 1010.6, subd. (a)(3)(B) [permitting two extra court days to act when service of paper made via email]; Opp’n, Safvati Decl., ¶ 2 [deposition officer emailed transcript]; see also Reply, pp. 1-3 [failing to dispute the application of section 1010.6, subdivision (a)(3)(B)].)

Last, the Court notes that Defendants, by adopting the pleadings as evidence in their motion and separate statement, have further relied on the very allegations they seek to repudiate. If the Court were to accept that the November 14, 2022 amendment by Plaintiff Haghani was not timely and that the September 20, 2022 deposition testimony by Plaintiff Haghani stood for the proposition that Plaintiff Haghani testified that Defendants never reaffirmed their promise to compensate Plaintiffs in the amount of $1.5 million per the terms of the Agreement, Defendants’ separate statement nevertheless incorporates paragraphs 20, 22, and 27 to 29 of the SAC into evidence. (See, e.g., Mot., Separate Statement, UMF Nos. 7-10 [incorporating SAC, ¶¶ 20, 22 into evidence], 13-14, 16-17, 19-20 [incorporating SAC, ¶¶ 27-29 into evidence]; see Mark Tanner Constr., Inc. v. HUB Int’l Ins. Servs., supra, 224 Cal.App.4th at p. 586; Food Safety Net Servs. v. Eco Safe Sys. USA, Inc., supra, 209 Cal.App.4th at pp. 1126-1127.) These paragraphs in the SAC plead that Defendants made repeated promises to abide by the terms of the March 5, 2009 Agreement up until November 11, 2020, when Defendants for the first time repudiated their promise to compensate Plaintiffs in the amount of $1.5 million. (See SAC, ¶¶ 20, 22, 27-29.) As a result, Defendants present evidence that both supports their burden on summary judgment and at the same, completely undercuts their position on summary judgment.

Defendant’s motion for summary judgment of the first and second causes of action alleged in the SAC is therefore DENIED.

SAC, Third and Fourth Causes of Action, Statute of Limitations: DENIED.

The third and fourth causes of action alleged in the SAC plead Fraud and Negligent Misrepresentation against Defendants based on misrepresentations relating to the size of the shopping mall to be built on the property, when Defendants would convey back Plaintiffs’ interest in the property, and Defendants’ intent to abide by the terms of the March 5, 2009 Agreement. (SAC, ¶¶ 58-70, 71-77.)

Per Defendants, the relevant statute of limitations for these claims is three years and two years respectively. (Mot., p. 8 [citing to Code Civ. Proc., §§ 338, subd. (d), 339 respectively].)

The Court adopts its discussion as to the first and second causes of action to find that Defendants’ evidence does not undercut the material allegations in the SAC pleading that either the discovery date for Plaintiffs’ injuries or the last overt act by Defendants relating to Plaintiffs’ injuries took place on November 11, 2020, less than a year before this action was filed on April 1, 2021, well within any two- or three-year statute of limitations. (Compare SAC, ¶ 29 [alleging Defendants repudiated promises to compensate Plaintiffs on November 11, 2021], with Complaint, ¶ 26 [despite being filed on April 1, 2021, alleging Defendants repudiated promises to compensate Plaintiffs on November 11, 2021, pointing to November 11, 2020 as repudiation date].)

Defendant’s motion for summary judgment of the third and fourth causes of action alleged in the SAC is therefore DENIED.

SAC, Fifth Cause of Action, Statute of Limitations: MOOT.

Based on the Court’s March 9, 2023 ruling, the IIED claim pleaded as the SAC’s fifth cause of action was dropped from this action in light of a sustained demurrer to this claim, without leave to amend. (See 3/9/23 Minutes, p. 14.) 

Conclusion

 Defendants Atlantic Park Plaza, LLC, Yehezkel Hezi Kashanian, and Javid Somekh’s Motion for Summary Judgment is DENIED, in Part, and MOOT, in Part, as follows:

(1) DENIED as to summary judgment of the SAC’s first to fourth causes of action because Defendants’ fail to carry their burden of showing no triable issues of material fact as to these claims; and

(2) MOOT as to summary judgment of the SAC’s fifth cause of action because on March 9, 2023, the Court sustained a demurrer to this cause of action, without leave to amend.