Judge: Curtis A. Kin, Case: 21STCV31683, Date: 2023-04-18 Tentative Ruling

Case Number: 21STCV31683    Hearing Date: April 18, 2023    Dept: 72

MOTION FOR LEAVE TO FILE CROSS-COMPLAINT

Date:               4/18/23 (8:30 AM)

Case:               Andrew Scott Robertson et al. v. Phase 5 Energy LTD et al. (21STCV31683)

TENTATIVE RULING:

Defendants Phase 5 Energy LTD, Andrew Smart, and Philip Plough’s Motion for Leave to File Cross-Complaint is GRANTED.

Defendants’ requests to take judicial notice are DENIED as “unnecessary to the resolution” of the issues before the Court. (Martinez v. San Diego County Credit Union (2020) 50 Cal.App.5th 1048, 1075.)

Defendants Phase 5 Energy LTD (“Phase 5”), Andrew Smart, and Philip Plough seek leave to file a Cross-Complaint against plaintiffs Scott Robertson and Scott Robertson Design, LLC, as well as Christopher Patton.

Defendants’ proposed claims are compulsory because they arise out of the operation of Phase 5, a defendant in the Complaint and a proposed cross-complainant. (See CCP §426.10(c) [“‘Related cause of action’ means a cause of action which arises out of the same transaction, occurrence, or series of transactions or occurrences as the cause of action which the plaintiff alleges in his complaint.”]; Proposed XC ¶¶ 1-5.) In the Complaint, plaintiffs Andrew Scott Robertson and Scott Robertson Design, LLC seek damages against Phase 5 and its officers, defendants Andrew Smart, and Philip Plough, for breach of agreements regarding their compensation, return on investments, and unpaid rent and for destruction of the value of Robertson’s shares in Phase 5 arising from the termination of Phase 5’s business. In the proposed Cross-Complaint, defendants allege that the cause of the harm alleged in the Complaint is the fault of Robertson and Patton. (Proposed XC ¶¶ 1, 104, 105.)

Plaintiffs oppose the motion on the ground that the proposed Cross-Complaint is duplicative of another action filed in Florida and that the Court does not have jurisdiction over Patton. In the interest of avoiding forfeiture of any causes of action, as required under CCP § 426.50, plaintiffs’ contentions do not bar the filing of the Cross-Complaint. Patton may seek any relief to which he believes he is entitled after the filing of the Cross-Complaint.

Plaintiffs also contend that the Cross-Complaint is not proposed in good faith because defendants were purportedly aware of the claims against Patton since February 2021 and did not file this motion until two years later. Defendants adequately explain that, after their current counsel substituted into the action in February 2023, counsel reviewed the file and discovered the claims against plaintiffs. (Downes Decl. ¶¶ 2, 3.) Plaintiffs fail to show substantial evidence of bad faith that would warrant denial of the filing of the proposed Cross-Complaint. (Silver Organization, Ltd v. Frank (1990) 217 Cal.App.3d 94, 99 [“A motion to file a cross-complaint at any time during the course of the action must be granted unless bad faith of the moving party is demonstrated where forfeiture would otherwise result”].)

The motion is GRANTED. Defendants are ordered to file the Cross-Complaint as proposed in the motion within two (2) court days hereof.