Judge: Curtis A. Kin, Case: 21STCV31344, Date: 2023-01-24 Tentative Ruling
Case Number: 21STCV31344 Hearing Date: January 24, 2023 Dept: 72
MOTION FOR SUMMARY JUDGMENT, OR IN THE ALTERNATIVE,
FOR SUMMARY ADJUDICATION
Case: One Cal Plaza Owner, LLC v.
Broadway Elite, LLC et al. (21STCV31344)
TENTATIVE
RULING:
Plaintiff One Cal Plaza Owner, LLC’s Motion for Summary
Judgment, or in the Alternative, for Summary Adjudication is GRANTED.
Plaintiff One Cal Plaza Owner, LLC’s requests for judicial
notice of the Complaint and Answer are GRANTED, but only for the existence of
the documents, not the truth of the matters asserted therein. (See Evid. Code §
452(d); Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1564-69.)
Plaintiff’s evidentiary objections are OVERRULED.
Plaintiff One Cal Plaza Owner, LLC moves for summary
judgment, or in the alternative, summary adjudication as to the breach of
lease, breach of guaranty, and declaratory relief causes of action.
With respect to the third cause of action for declaratory
relief, plaintiff prays for a judicial declaration that the term of the subject
lease commenced on June 23, 2016 and expired on June 22, 2021. (Compl. ¶ 33;
Prayer ¶ 2.)
Plaintiff provides evidence that the beginning date for the
subject lease was June 23, 2016, and the end date for the lease was June 22, 2021,
including the Notice of Lease Term Dates dated October 19, 2016 and the Tenant
Estoppel Letter dated September 6, 2017, both signed by defendant Broadway
Elite, LLC’s (“Broadway Elite”) former Executive Vice President, Danny Wei.
(UMF 5.)
Defendants Broadway Elite and SCG America Group, Inc.
maintain that there are triable issues based on affirmative defendants of
waiver, acquiescence, estoppel, or promissory estoppel.
Defendants refer to an email dated November 30, 2020 to
plaintiff’s broker, Jones Lang LaSalle Brokerage, Inc., wherein defendants
indicated their understanding that the lease was to expire on January 30, 2011
and that they were scheduled to move into their new office the week of January
15, 2021. (Defs. Exs. C, D.) In response, the broker referred defendants to
plaintiff’s management company, Rising Realty Partners, who coordinated
defendants with the vacating of the subject premises. (Defs. Ex. E.) Defendants
maintain that by not correcting them on the asserted June 22, 2021 end date,
plaintiff’s broker and management company modified the end date of the lease.
(Resp. to UMF 9.)
The communications from the broker and the management
company are insufficient to modify the end date of the lease. The lease
provided that it could not be modified except in writing signed by the landlord
(One Cal Plaza Owner, LLC) and the tenant (Broadway Elite). (UMF 6.) Defendants
do not present any writing signed by plaintiff, as opposed to the broker or
management company, indicating any agreement from plaintiff to advance the end
date of the lease to January 30, 2011.
Regardless of whether the affirmative defenses of waiver,
acquiescence, estoppel, or promissory estoppel were pled or adequately pled,
defendants’ evidence is insufficient to demonstrate a triable issue concerning
these affirmative defenses. (Harper v. Kaiser Cement Corp. (1983) 144
Cal.App.3d 616, 619 [“Waiver may occur by intentional relinquishment or by
conduct so inconsistent with an intent to enforce the right as to induce a
reasonable belief that such right has been relinquished”]; In re Marriage of
Kalinawan (2017) 15 Cal.App.5th 1265, 1273 [equitable estoppel “provides
that a person may not deny the existence of a state of facts if he
intentionally led another to believe a particular circumstance to be true and
to rely upon such belief to his detriment”]; Granadino v. Wells Fargo Bank,
N.A. (2015) 236 Cal.App.4th 411, 416 [elements of a promissory estoppel
claim are “(1) a promise clear and unambiguous in its terms; (2) reliance by
the party to whom the promise is made; (3)[the] reliance must be both
reasonable and foreseeable; and (4) the party asserting the estoppel must be
injured by his reliance”].)
According to the Tenant Estoppel Letter, signed by Broadway
Elite’s Executive Vice President, the end date for the lease was June 22, 2021.
(UMF 10.) “[U]nder [Evidence Code] section 622, when a tenant signs and
delivers an estoppel certificate, as required under the commercial lease
agreement, that tenant is bound to the recitations of fact contained therein.”
(Plaza Freeway Ltd. Partnership v. First Mountain Bank (2000) 81
Cal.App.4th 616, 629; see also Martin Decl. ¶ 8 & Ex. 4 at Art. 17
[requirement to provide an estoppel certificate].)
Plaintiff also demonstrates that defendants were aware of
the end lease date of June 22, 2021. On December 21, 2020, before defendants
vacated the premises, Broadway Elite’s business consultant sent an email on
behalf of the current EVP, Charles Qi Wang, indicating Broadway Elite’s
awareness that the Notice of Lease Term Dates signed by former EVP Danny Wei
provides for a lease end date of June 22, 2021. (UMF 60.) Henry Yong, Broadway
Elite’s Director of Corporate Affairs, also testified during deposition that he
reviewed the Tenant Estoppel Letter in December 2020 but Broadway Elite elected
to vacate the premises because it was finalizing a lease at a different
property. (UMF 61-63.)
Based on defendants’ failure to present any writing signed
by plaintiff indicating that the end lease date on the Tenant Estoppel Letter
was modified, defendants are precluded from demonstrating reliance on the
representations of the broker and management company. (See Ostayan v.
Serrano Reconveyance Co. (2000) 77 Cal.App.4th 1411, 1418-19, disapproved
of on other grounds by Black Sky Capital, LLC v. Cobb (2019) 7 Cal.5th
156 [reliance on statements contradicting governing legal agreement and absence
of misrepresentation from defendants precludes finding of reliance].)
Defendants also fail to show that plaintiff waived or
acquiesced to any assertion of a June 22, 2021 end lease date. Defendants do
not dispute that plaintiff sent notices of nonpayment of rent due for each
month from February 2021 through June 2021. (UMF 66.)
Plaintiff is therefore entitled to summary adjudication as
to the third cause of action for declaratory relief, namely, a judicial
declaration that the term of the subject lease commenced on June 23, 2016 and
expired on June 22, 2021.
With respect to the first cause of action for breach of
contract and second cause of action for breach of guaranty, it is undisputed
that Broadway Elite vacated the premises on January 31, 2021 (before the lease
expired) and ceased paying rent. (UMF 13, 14.) Defendants adduce no evidence to
the contrary. Defendants, however, dispute
whether plaintiff may prevail on its claims for breach of contract as a matter
of law, arguing that plaintiff failed to mitigate its claimed damages of $138,896.21
for the outstanding rent (Resp. to UMF 17).
(See Paramount Petroleum Corp. v. Superior Court (2014) 227
Cal.App.4th 226, 241 [because damages are an element of a breach of contract
cause of action, a triable issue as to damages will defeat summary adjudication].)
“If [defendant] breached the contract and the breach caused harm,
[plaintiff] is not entitled to recover damages for harm that [defendant] proves
[plaintiff] could have avoided with reasonable efforts or expenditures.” (CACI
358.) “The doctrine of mitigation of damages holds that ‘[a] plaintiff who
suffers damage as a result of ... a breach of contract ... has a duty to take
reasonable steps to mitigate those damages and will not be able to recover for
any losses which could have been thus avoided.’” (Valle de Oro Bank v.
Gamboa (1994) 26 Cal.App.4th 1686, 1691.)
Here, on its initial burden, plaintiff presents evidence
that it immediately listed the subject premises for lease beginning on July 1,
2021 (UMF 71), less than ten days after the lease terminated on June 22, 2021. This is sufficient to shift the burden to
defendant to raise a triable issue of fact as to whether defendant can meet its
burden at trial to prove plaintiff failed to reasonably mitigate damages. On its shifted burden, defendant presents no
evidence that plaintiff’s effort to rent the subject premises starting on July
1, 2021 was unreasonable.
Accordingly, defendant fails to raise a triable issue of
material fact as to either the breach of contract or breach of guaranty claims
in plaintiff’s first and second causes of action, respectively.
For the foregoing reasons, plaintiff’s Motion for Summary
Judgment is GRANTED. Plaintiff shall
submit a proposed judgment in accordance herewith within five (5) Court days.