Judge: Barbara M. Scheper, Case: 22STCV15690, Date: 2023-05-23 Tentative Ruling
Case Number: 22STCV15690 Hearing Date: May 23, 2023 Dept: 30
Calendar No.
Preferred Bank
vs. Beach Orangethorpe, LLC, et. al., Case No. 22STCV15690
Tentative Ruling
re: Cross-Complainant’s Motion for Leave
to Amend Cross-Complaint
Beach Orangethorpe, LLC (BO1) moves for leave to file the
Third Amended Cross-Complaint (TACC). The motion is opposed by BO Lenders
United, LLC (BO Lenders). The motion is denied.
The court may, in its discretion
and after notice to the adverse party, allow, upon any terms as may be just, an
amendment to any pleading, including adding or striking out the name of any
party, or correcting a mistake in the name of a party, or a mistake in any
other respect. (Code Civ. Proc., § 473, subd. (a)(1).)
California courts are required to
permit liberal amendment of pleadings in the interest of justice between the
parties to an action. (Code Civ. Proc., § 473, subd. (a); Dieckmann v. Superior Court (1985) 175 Cal.App.3d 345, 352.)
“Public policy dictates that leave to amend be liberally granted.” (Centex Homes v. St. Paul Fire & Marine
Ins. Co. (2015) 237 Cal.App.4th 23, 32.)
Under 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 pleading, 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.
BO1’s proposed TACC asserts seven
causes of action against BO Lenders. Relative to BO1’s operative Second Amended
Cross-Complaint (SACC), which was filed in November 2022, the TACC adds factual
allegations regarding BO1’s written consent votes that took place in September
2022 and March 2023 that both allegedly confirmed BO1’s decision to remove BO
Lenders as manager of BO1. (Motion, p. 9:3; Ex. A, ¶¶ 49-58, 60-67, 77-89
[30].) The TACC also edits the second cause of action for declaratory relief to
reflect those alleged facts: under the second cause of action in the SACC, BO1
sought a declaration as to whether the February 7, 2022 Written Consent
effectively removed BO Lenders as manager (SACC ¶ 78); in the TACC, BO1 seeks a
declaration that the February 2022 Written Consent, or, alternatively, the
September 2022 Written Consent or the March 2023 Consent, was valid and
effective to remove BO Lenders as manager. (Motion, Ex. A, ¶ 98 [33].)
The TACC also adds allegations
regarding conversations that took place in January and February 2022, which BO1
states have only recently come to its attention. (Motion pp. 9-10; Ex. A ¶¶
25-27.) BO1 states in its motion that the proposed amendments are necessary to
add allegations of relevant facts that have recently transpired or recently come
to BO1’s attention. (Motion p. 6.)
Rules of Court, rule 3.1324(b)
requires that a motion to amend a pleading be accompanied by a separate,
supporting declaration, specifying (1) the amendment’s effect, (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.
The attached declaration of BO1’s
counsel discusses BO1’s March 27, 2023 Written Consent vote (Motion, Ex. B),
but does not address any of the newly-added allegations regarding the events in
January and February 2022, or the September 2022 consent vote. (Motion, Ex. A
¶¶ 25-27, 49-58.) BO1’s memorandum also fails to explain when those facts were
discovered or why they were not added earlier. (Rules of Court, rule 3.1324,
subds. (b)(3)-(4).) BO1 only states, without further explanation, that the
facts “have only recently come to BO1’s attention.” (Motion p. 9:17.) This
fails to satisfy the requirements set by rule 3.1324.
In addition, BO1 has not attached a
redlined copy of the TACC, though the Motion refers to one. (Motion p. 10:7.)
BO1 describes the proposed changes in various parts of the Memorandum, but it
is difficult to tell what allegations have been added and deleted in violation
of CRC 3.1324.