Judge Christian R. Gullon, Case Number: 22PSCV00439, Date: 2024-08-27 Tentative Ruling

Judge: Christian R. Gullon, Case: 22PSCV00439, Date: 2024-08-27 Tentative Ruling

The Court may change tentative rulings at any time. Therefore, attorneys are advised to check this website to determine if any changes or updates have been made to the tentative ruling.

Counsel may submit on the tentative rulings by calling the clerk in Dept. O at 909-802-1126 before 8:30 the morning of the hearing. Submission on the tentative does not bind the court to adopt the tentative ruling at the hearing should the opposing party appear and convince the court of further modification during oral argument.

The Tentative Ruling is not an invitation, nor an opportunity, to file any further documents relative to the hearing in question. No such filing will be considered by the Court in the absence of permission first obtained following ex-parte application therefore.

Plaintiffs’ Application for Entry of Default Judgment is DENIED without prejudice (namely for insufficient evidence of damages).

This case arises from a home renovation. Plaintiffs ARJAN IDNANI and SHAUN IDNANI[1] allege the following against Defendants DH BUILDING, INC. (“DH”); ALISA LI aka DAN LI (“Alisa”); GEORGE TOC (“George”)[2] and Doe Defendants: On October 16, 2019, Plaintiffs and DH entered into a written contract whereby DH would perform certain construction work (to build a first and second floor remodel and two-story addition) on Plaintiffs’ residence for $300,000. Defendants began the work on September 10, 2020. However, the work was delayed; Defendants failed to complete the work; Defendants used inferior quality materials; and Defendants damaged the premises. Additionally, Plaintiffs allege that Defendants failed to secure the work site resulting in theft of personal property and also brought a dog onto the premises that attacked and bit one of the Plaintiffs.

On May 6, 2022, Plaintiffs filed suit asserting the following seven causes of action (COAs):

On April 24, 2024, Plaintiffs filed a POS as to George indicating that he was served via substituted service on 4/19/24 by serving George’s brother.

On July 18, 2024, Plaintiffs filed the instant application for entry of default judgment.

Plaintiffs seek entry of default judgment against Defendants (DH, Alisa, and George) in the total amount of $330,593.42, comprised of $262,052 in damages; $58,006.32 in prejudgment interest;[3] $8,511.04 in attorney fees;[4] and $2,024.06 in costs. (See JUD-100 form.)

As more specifically laid out in Plaintiffs’ declarations, the total property and economic damages resulting from the acts and omissions of Defendants are as follows (see Idnani Decls., ¶32):

Here, the application is denied for insufficient evidence. (See Kim v. Westmoore Partners, Inc. (2011) 201 Cal.App.4th 267 [setting forth trial court’s role in ensuring sufficient evidence is provided that support well pled allegations].)

First, Plaintiffs contend that their new contractor has estimated it will cost an additional $350,000 to complete the work. (¶26.) However, no evidence (i.e., statement from contractor) has been submitted.

Second, Plaintiffs contend that “[b]ecause of the wrongful acts of Li, Toc and DH Building, I have had to pay $800 per month for 13 months for alternative housing because the delays and negligence totaling $10,400.00.” (¶28.) However, no evidence (i.e., receipts or billing statements) have been submitted to support these damages.

Third, Plaintiffs, contend that they “also had to pay the following additional costs that they would not have otherwise had to pay as a direct and proximate result of the negligence of Li and DH Building, in the amount of $5,272.00 including without limitation (a) Storage at CubeSmart in the amount of $2,512….” (¶29.) For similar reasons above, absent evidence, this cost is not recoverable.

Fourth, Plaintiffs seek damages for trespass wherein the workers used the garage as a break room; they seek $1,120 per month from September 2020 to April 2022 for a total of $21,280. (¶30.) However, according to Plaintiffs’ declarations, there were months wherein workers did not even work. (See ¶13 [“For numerous days, and entire weeks and months they ceased all Work on the Contract, and even when workers did arrive at the Residence, they often only performed marginal tasks while waiting for direction or supervision that never arrived. For example, they performed no work during the following weeks: September 21 to 27, October 5 to November 12, November 24 to December 2, 2020, January 7 to 13, 2021, February 4 to 9, September 27 to October 9, November 26 to 28, 2021, January 14 to 31, 2022, February 1 to 19, 2022, March 6 to the present.”], emphasis added.). Thus, the court seeks clarification as to the damages relating to the trespass COA.

Based on the foregoing—namely insufficient evidence—the application for entry of default judgment is denied without prejudice.

[1] Arjan is the father and Shaun is his son. (Arjan Idnani Decl., ¶1.)

[2] According to the complaint, Alisa is the responsible managing officer, president, and chief executive officer of DH and George is the construction manager on the project at the premises and an employee of DH. Additionally, Plaintiffs allege that they believe DH is an alter ego of Alisa. (Complaint p. 2.) Generally, a corporate officer may not be personally liable for the acts or obligations of their corporation. However, there are some exceptions. One is when the director or officer directly authorized or actively participated in wrongful or tortious conduct. (See Frances T. v. Village Green Owners Assn. (1986) 42 Cal.3d 490, 503-504; see also Wyatt v. Union Mortgage Co. (1979) 24 Cal.3d 773, 858.) Another is “piercing the corporate veil” which occurs when the individual (officer/director) abused the corporate form such that it would be unfair to shield the individual from personal liability. (See Sonora Diamond Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 538-599 [background and framework for alter ego/piercing the corporate veil].) Here, a review of the evidence provides a sufficient basis for piercing the corporate veil because Alisa directed Plaintiffs to directly pay her for construction materials and it became evident that DH didn’t have adequate capitalization to pay for the construction materials. (Idnani Decl., ¶4.) (The exhibits provide that checks were made to DH, but that some payments were made to George; none were made to Alisa.) Additionally, there is sufficient evidence to hold Alisa personally liable as she directly made misrepresentations. (See e.g., Idnani Decl., ¶8 [“[Alisa] went so far as to misrepresent [] that permits had been approved, when in fact, they had not. [She] also falsely blamed the City of Diamond Bar for the failure to timely approve the applications….”].) Therefore, Plaintiffs attempt to seek default judgment against all defendants is permissible.

[3] Plaintiffs seek prejudgment interest pursuant to Civil Code section 3289(b). (See Goldberg Decl., ¶3.) (Civil Code 3289(b) only sets forth the legal rate of interest; considering that Plaintiffs seek prejudgment interest from the date of filing the complaint, then the court presumes Plaintiffs seek interest pursuant to Civil Code section 3287(a) [liquidated damages since damages for dog bite are not sought]; see Maurice L. Bein, inc. v. Housing Auth. of City of Los Angeles (1958) 157 Cal.Ap.2d 679, 686.) Calculation: 808 days (5/6/22 (date complaint filed) to 7/17/24 (date application filed) x $71.79 daily interest.

[4] Attorney fees were calculated using the Local Rules.