Judge Cynthia A Freeland, Case 37-2023-00013078-CU-NP-NC 2023-10-20 Tentative Ruling

Judge: Cynthia A Freeland, Case: 37-2023-00013078-CU-NP-NC, Date: 2023-10-20 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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SOUTH BUILDING TENTATIVE RULINGS - October 19, 2023

10/20/2023 01:30:00 PM N-27 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Cynthia A. Freeland

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Civil - Unlimited Non-PI/PD/WD tort - Other Demurrer / Motion to Strike 37-2023-00013078-CU-NP-NC 555 ESCONDIDO LAND TRUST VS. KADAKIA [IMAGED] CAUSAL DOCUMENT/DATE FILED: Demurrer, 08/15/2023

Defendants Rajesh Kadakia, Greens Global, Inc., and MCD Services, Inc. (collectively, 'Defendants')'s demurrer to Plaintiff Nasser Masaudnejad as Trustee for 555 Escondido Land Trust ('555' and, together with Mr. Masaudnejad, 'Plaintiff')'s First Amended Complaint (the 'FAC') is sustained.

Defendants' request for judicial notice ('RJN') is granted.

A demurrer tests the legal sufficiency of a pleading. See McKell v. Washington Mutual, Inc. (2006) 142 Cal. App. 4th 1457, 1469. When reviewing a demurrer, the court 'give[s] the complaint a reasonable interpretation, reading it as a whole and its parts in their context.' Blank v. Kirwan (1985) 39 Cal. 3d 311, 318. The court 'treats the demurrer as admitting all material facts properly pleaded. The court does not, however, assume the truth of contentions, deductions or conclusions of law.' Durell v. Sharp Healthcare (2010) 183 Cal. App. 4th 1350, 1358. The court's analysis is limited to the complaint, exhibits attached to the complaint and incorporated by reference, and matters properly subject to judicial notice. See Performance Plastering v. Richmond American Homes of California, Inc. (2007) 153 Cal. App. 4th 659, 665; Thorburn v. Department of Corrections (1998) 66 Cal. App. 4th 1284, 1287-1288; Donabedian v. Mercury Ins. Co. (2004) 116 Cal. App. 4th 968, 994.

Defendants' demurrer to the FAC is sustained. Collateral estoppel, or issue preclusion, 'is a judicially-created doctrine which operates to bar the re-litigation of issues previously adjudicated in order to limit harassment and preserve judicial resources.' Conservatorship of Buchenau (2011) 196 Cal. App. 4th 1031, 1040. Collateral estoppel applies only if the following requirements are met: (1) the issue sought to be precluded from re-litigation is identical to that decided in the former proceeding; (2) the issue must have been actually litigated in the former proceeding; (3) the issue must have been necessarily decided in the former proceeding; (4) the decision in the former proceeding is final and on the merits; and (5) the party against whom preclusion is sought is the same as, or in privity with, the party to the former proceeding. See Proctor v. Vishay Intertechnology, Inc. (2013) 213 Cal. Ap. 4th 1258, 1272. The party asserting collateral estoppel bears the burden of demonstrating each of its elements.

See Jenkins v. County of Riverside (2006) 138 Cal. App. 4th 593, 617.

The court finds that Defendants have established that Plaintiff is collaterally estopped from asserting his sole cause of action for conversion against them. The court has taken judicial notice of the Complaint filed on August 9, 2021 in Masoudnejad v. Gundersen et al. (Case No. 37-2021-00034000-CU-MC-NC) (the 'First Case'). See Defendants' RJN, Ex. 1; O'Keefe Decl., Ex. B. In the First Case, Mr.

Masaudnejad, in his individual capacity, sued Defendants, Erik Gundersen, and Gundy's Garage and Restoration for conversion, conspiracy to commit conversion, and civil extortion. The Complaint in the Calendar No.: Event ID: TENTATIVE RULINGS

3018882 CASE NUMBER: CASE TITLE: 555 ESCONDIDO LAND TRUST VS. KADAKIA [IMAGED] 37-2023-00013078-CU-NP-NC First Case alleged that Mr. Masaudnejad owns and leases a commercial building in Escondido, CA through the entity 555 Car Complex, Inc. Mr. Gundersen owned and operated Gundy's Garage and Restoration in Unit B of the commercial building pursuant to a written lease between 555 Car Complex and Mr. Gundersen. Several fixtures were located in and part of the lease of Unit B, all of which were owned by Mr. Masaudnejad. After the lease expired, Mr. Gundersen allegedly sold various fixtures in Unit B to Mr. Kadakia, including vehicle lifts, a brake lathe, a tire balancer, a tire machine, a floor jack, tool boxes, a battery charger, transmission jack, strut compressor, chairs, a desk, an air conditioner, and an air hose. Mr. Gundersen also allegedly sold Mr. Kadakia a commercial air compressor, but Mr.

Masaudnejad intervened before the sale could be consummated. The Complaint in the First Case further alleged that Defendants, despite having actual or constructive knowledge that Mr. Gundersen stole the fixtures from Unit B, agreed to purchase the fixtures and subsequently refused to return them to Mr.

Masaudnejad unless he executed a hold harmless agreement. On March 29, 2023, the jury returned a special verdict in the First Case as to Mr. Masaudnejad's conversion claim, finding that he did not own the three lifts. See Defendants' RJN, Ex. 2; O'Keefe Decl., Ex. C.

On March 30, 2023 – the day after the jury's special verdict form was filed in the First Case – 555 commenced this action by filing a Complaint for conversion against Defendants. See Defendants' RJN, Ex. 1; O'Keefe Decl., Ex. B. On July 17, 2023, Plaintiff filed the FAC alleging a single cause of action for conversion against Defendants. The FAC, unlike the Complaint in the First Case, has been brought by Mr. Masaudnejad in his capacity as Trustee for 555. The allegations in the FAC and in the Complaint in the First Case are identical except for owner of the commercial building and its fixtures – the FAC alleges that 555 owns them whereas the Complaint in the First Case alleged that Mr. Masaudnejad owned them. More specifically, the FAC, like the Complaint in the First Case, alleges that Mr. Gundersen leased Unit B from 555 through its property manager, 555 Car Complex. Mr. Gundersen allegedly sold several fixtures in Unit B to Defendants, including three vehicle lifts. Defendants, despite having actual or constructive knowledge that the fixtures belonged to 555, purchased the fixtures from Mr. Gundersen and refused to return them to 555 absent a hold harmless agreement.

The court finds that all the requirements for application of collateral estoppel are present in this instance.

First, the issue that Plaintiff seeks to litigate in the present case is identical to the one litigated in the First Case, i.e., whether Defendants converted the fixtures located at Unit B when they purchased them from Mr. Gundersen and refused to return them despite knowing that Mr. Gundersen had stolen them. See Lucido v. Sup. Ct. (1990) 51 Cal. 3d 335, 342 ('The 'identical issue' requirement addresses whether 'identical factual allegations' are at stake in the two proceedings, not whether the ultimate issues or dispositions are the same.').

Second, this issue was actually litigated and necessarily decided. 'When an issue is properly raised, by the pleadings or otherwise and is submitted for determination, and is determined, the issue is actually litigated . . . Whether an issue was 'necessarily decided' has been interpreted to mean that the issue was not 'entirely unnecessary' to the judgment in the prior proceeding.' Murphy v. Murphy (2008) 164 Cal. App. 4th 376, 400. The issue of Defendants' conversion of the fixtures was properly raised by way of the Complaint in the First Case. Moreover, the issue was necessary to the judgment in the First Case – indeed, the jury found in Defendants' favor on Mr. Masaudnejad's conversion claim because he failed to demonstrate that he owned the three lifts. Absent ownership or a right to possession of the personal property, Defendants could not be found liable to Mr. Masaudnejad for conversion. See Regent Alliance Ltd. v. Rabizadeh (2014) 231 Cal. App. 4th 1177, 1181.

Fourth, the decision in the First Case is final and on the merits. The court takes judicial notice of the fact that on May 2, 2023, the court in the First Case entered a Judgment based on the jury's special verdict.

Mr. Masaudnejad did not file a notice of appeal of the Judgment within the time to do so.

Finally, the party against whom preclusion is sought, i.e., Mr. Masaudnejad in his capacity as Trustee for 555, is the same as, or in privity with, the party in the First Case. 'The concept of privity for purposes of .

. . collateral estoppel refers to a mutual or successive relationship to the same rights of property, or to such an identification in interest of one person with another as to represent the same legal rights Calendar No.: Event ID: TENTATIVE RULINGS

3018882 CASE NUMBER: CASE TITLE: 555 ESCONDIDO LAND TRUST VS. KADAKIA [IMAGED] 37-2023-00013078-CU-NP-NC [citations] and, more recently, to a relationship between the party to be estopped and the unsuccessful party in the prior litigation which is 'sufficiently close' so as to justify application of the doctrine of collateral estoppel. [Citations.]' Rodgers v. Sargent Controls & Aerospace (2006) 136 Cal. App. 4th 82, 90-91. In the First Case, Mr. Masaudnejad claimed to own the commercial building and the same fixtures that are the subject of the instant action. In this case, it has been alleged that 555, an entity to which Mr. Masaudnejad serves as Trustee, owns the commercial building and fixtures. Given the close relationship between Mr. Masaudnejad and 555 as well as their respective past and present claims of ownership in the fixtures, the court finds that the existence of privity is sufficient to justify the application of collateral estoppel in this case.

Accordingly, the court sustains the demurrer without leave to amend as Plaintiff has failed to demonstrate a reasonable possibility that the foregoing deficiencies can be cured by amendment. See Aubry v. Tri-City Hospital Dist. (1992) 2 Cal. 4th 962, 967.

In light of the foregoing, the court sustains the demurrer without leave to amend. Defendants are directed to submit a proposed Judgment within ten (10) days of this hearing.

This is the tentative ruling for the hearing at 1:30 p.m. on Friday, October 20, 2023. If no party appears at the hearing, this tentative ruling will become the order of the court as of October 20, 2023. If the parties are satisfied with the court's tentative ruling or do not otherwise wish to argue the motion, they are encouraged to give notice to the court and each other of their intention not to appear, though this notice is not required.

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