Judge: David S. Cunningham, Case: JCCP5326, Date: 2024-07-12 Tentative Ruling

Case Number: JCCP5326    Hearing Date: July 12, 2024    Dept: 11

Metropolis Homeowners Association Cases (JCCP 5326)

Tentative Ruling Re: Petition for Coordination

Date:                                       7/12/24

Time:                                      1:45 pm

Moving Party:                       Oleg Pariser (“Petitioner”)

Opposing Party:                    Greenland LA Metropolis I LLC, et al. (collectively “Greenland”)

Department:                          11

Judge:                                    David S. Cunningham III

________________________________________________________________________

TENTATIVE RULING

Petitioner’s request for judicial notice and Greenland’s request for judicial notice are granted in full.  The documents are court records.  The Court will judicially notice the existence of the documents but not the truth of their contents.

Petitioner’s petition for coordination is denied.

BACKGROUND

Petitioner submitted a petition to the Chairperson of the Judicial Council for pretrial coordination of the following cases (“Included Actions”):

* Metropolis Master Association v. Pariser (23STCV27046 [Los Angeles County]) (“MMA”);

* Pariser v. Metropolis Master Association (23STSC04388 [Los Angeles County]); and

* Greenland LA Metropolis Development I LLC v. Metropolis I Condominium Owners’ Association (30-2023-01346055-CU-NP-CJC [Orange County]) (“Greenland”).

Petitioner describes the Included Actions this way:

This litigation arises from a developer/declarant’s failure to tender timely payment of assessments levied by its successor master homeowner association and its subassociation.  In 2022, a member of the master homeowner association who was also a volunteer director for the subassociation, Oleg Pariser, blew the proverbial “whistle” on years of non-payments in reliance on purported assessment abatement agreements entered into when the developer/declarant controlled the boards of directors for both non-profit corporations.  This action stems from the developer/declarant’s continued failure to pay assessments due and owing to the master homeowner association and failure to disqualify its candidates in accordance with applicable statute and its Governing Documents, as that term is defined in section 4150 of the Civil Code.

This action is also part of a larger dispute currently pending in several different forums that[, in addition to the Included Actions,] includes . . . an arbitration[] and an administrative action brought by the Department of Real Estate . . . .  At the heart of each of these actions is the developer/declarant’s failure to pay levied assessments due and owing in reliance on purported assessment abatement agreements entered while the developer/declarant controlled the boards of directors for both non-profit corporations.

(Petitioner’s Memorandum of Points and Authorities (“MP&A”), pp. 1-2, emphasis deleted.)

The Chief Justice and Chair of the Judicial Council issued an order assigning this Court to sit as the coordination motion judge to determine whether the Included Actions are complex and, if so, whether coordination is appropriate.

DISCUSSION

I.         Complex Determination

Only “complex” cases may be coordinated.  (Edmon & Karnow, Cal. Practice Guide: Civ. Procedure Before Trial (The Rutter Group June 2023 Update) ¶ 12:374.5.)  A “complex” case requires “exceptional judicial management to avoid placing unnecessary burdens on the court or the litigants and to expedite the case, keep costs reasonable, and promote effective decision making by the court, the parties, and counsel.”  (Cal. Rules of Court, rule 3.400(a).) 

In deciding whether an action is a complex case under (a), the Court must consider, among other things, whether the action is likely to involve:

(1) Numerous pretrial motions raising difficult or novel legal issues that will be time-consuming to resolve;

(2) Management of a large number of witnesses or a substantial amount of documentary evidence;

(3) Management of a large number of separately represented parties;

(4) Coordination with related actions pending in one or more courts in other counties, states, or countries, or in a federal court; or

(5) Substantial postjudgment judicial supervision.

(Id. at rule 3.400(b).)

[A]n action is provisionally a complex case if it involves one or more of the following types of claims:

(1) Antitrust or trade regulation claims;

(2) Construction defect claims involving many parties or structures;

(3) Securities claims or investment losses involving many parties;

(4) Environmental or toxic tort claims involving many parties;

(5) Claims involving mass torts;

(6) Claims involving class actions; or

(7) Insurance coverage claims arising out of any of the claims . . . .

(Id. at rule 3.400(c).)

Petitioner admits that the Included Actions are not provisionally complex. (See Petitioner’s MP&A, p. 10.)

He also admits that Parisher is a small claims action (see id. at p. 5), “[n]one of the parties have requested a ‘complex’ designation” (id. at p. 10), “the pre-trial motions will neither be difficult nor novel” (ibid.), “there are approximately a dozen witnesses total, with all the witnesses being the same” (ibid.), the Included Actions will not “be[] overly document intensive” (ibid.), and “no postjudgment supervision is anticipated.”  (Ibid.)

Indeed, he contends there is only one factor that “weighs in favor of a complex designation” – improper venue.  (Id. at p. 10 [claiming Orange County is an improper venue for Greenland].)

The Court disagrees.  Venue is a routine issue and does not bear on complexity.  It does not transform a noncomplex case into a complex one.  Moreover, since the venue issue exclusively pertains to Greenland, it fails to make MMA and Pariser complex.  These facts plus Petitioner’s admissions render rule 3.400 unsatisfied at to all three cases. 

This is reason enough to deny the petition.[1]

II.        Code of Civil Procedure Section 404.1

Section 404.1 states that a petition for coordination should be granted if doing so will “promote the ends of justice,” taking into account the following seven factors:

[W]hether the common question of fact or law is predominating and significant to the litigation; the convenience of parties, witnesses and counsel; the relative development of the actions and the work product of counsel; the efficient utilization of judicial facilities and manpower; the calendar of the courts; the disadvantages of duplicative and inconsistent rulings, orders, or judgments; and the likelihood of settlement of the actions without further litigation should coordination be denied.

(Code Civ. Proc. § 404.1.)

A.        Predominating Common Questions

Petitioner asserts that the Included Actions “concern the same Development, the same parties, and the same predominant issues of fact and law, to wit, whether the Illegal Abatement Agreements purportedly consummated while Greenland controlled the Met Master-Board and Met I-Board are enforceable or result in liability.”  (Petitioner’s MP&A, p. 7; see also Petitioner’s Reply, pp. 3-4 [claiming “[t]he dispositive issue in each action is whether Greenland was required to tender timely payment of all assessments due and owing to Met I and Met Master”].)

On March 28, 2024, Judge Michele Williams Court granted Petitioner’s motion for leave to submit a petition for coordination.  (See 3/28/24 Pariser Minute Order, p. 1.)  She held that Petitioner demonstrated a common issue of fact or law.  Importantly, though, she did not find that common issues predominated.  As she pointed out, the motion before her did not require her to “determine the ultimate issue of whether the cases should be coordinated.”  (Id. at p. 6.)  She merely had to assess whether Petitioner showed the existence of “civil actions sharing a common question of fact or law [] pending in different courts.”  (Ibid., emphasis added.)

This factor favors denial.  Petitioner’s burden now is to establish predominating common questions.  The Court agrees with Greenland that Petitioner fails to meet his burden because:  

. . . The matters involve entirely separate disputes relating to separate legal entities with 12 different legal counsel.

The Orange County Action involves the improper disqualification of Greenland's representative before she was able to participate in the election for Met I Association's board of directors. In the Los Angeles Action and Small Claims Action, no individual is being disqualified from an election; rather, an association member is challenging the already-existing board of directors for the separate legal entity Master Association – i.e., not Met I Association – and past election as being allegedly inconsistent with Master Association's election rules.

While one could overgeneralize to say there is a common fact in that the same real estate development is involved and both disputes loosely entail election disputes related to disputed assessments, these factors are not sufficient to . . . rise to the level of being "predominating and significant" to the litigation. Met I Association and Master Association are separate legal entities, with separate governing documents, separate boards of directors, and separate counsel. The election for one association's board of directors would have no bearing on the election for the other, and an individual could be ineligible to serve on one association's board and still be eligible to serve on the other association's board. Likewise, the issue of whether or not assessments are allegedly owed by Greenland to either association would involve entirely separate analyses, as there are different assessments, different abatements, and different associations implicated. Notably, despite Mr. Pariser's currently developed theory of Greenland's alleged "illegal" abatements, he was a member of the board of directors at the time of Greenland's abatements, was present at the meetings where the abatements were proposed, and did not vote against the abatements.

Additionally, out of at least fourteen different named parties across the three actions, the only two parties in common are Mr. Pariser himself and Master Association, which was only added to the Orange County Action by way of Mr. Pariser's own cross-complaint in the matter. Greenland does not contend that Master Association is responsible for Met I Association's misconduct during the subject election at issue in the Orange County Action.

Coordination of the actions is simply not necessary, as the matters involve different disputes implicating different entities, different governing documents, different elections, different boards of directors, and different counsel. The inquiry as to one association would not impact the inquiry as to the other, as separate election rules, separate assessments, and separate abatements are involved. . . .

(Greenland’s Opposition, pp. 10-11, emphasis deleted.)[2]

B.        Convenience of the Parties, Witnesses, and Counsel

Petitioner contends coordination would

promote forum convenience as it is undisputed that this is a local action (the Metropolis complex is 1.6 miles from the Stanley Mosk Courthouse), the Governing Documents for both CIDs disclose their principal offices at locations in Los Angeles County, their corporate disclosures do the same, their statutory disclosures do the same, and the Projects are indisputably located in Los Angeles County.

(Petitioner’s MP&A, p. 9.)

This factor is neutral or favors denial.  Deciding common issues in one forum typically conveniences the parties, witnesses, and counsel, but the present situation is different.  The overlap is minimal.  To reiterate, the disputes, entities, governing documents, elections, boards of directors, and counsel all differ.  “The inquiry as to one association would not impact the inquiry as to the other[.]”  (Greenland’s Opposition, p. 11.)  Individual issues predominate, so coordination would yield minor convenience at best.[3]

C.        Development of the Cases and the Work Product of Counsel

Petitioner does not appear to address this factor in his moving brief.  (See Petitioner’s MP&A, pp. 9-12.)

In reply, he claims the Included Actions are “in their infancy.”  (Petitioner’s Reply, p. 5.)  He states that “[n]o trial dates have been set, no depositions have been taken, minimal written discovery has been served, no experts have been disclosed, and no dispositive motions are pending.”  (Ibid.)

This factor favors denial.  The cases are not at the same stage.  Pariser has already been adjudicated and is on appeal, and, in Greenland, there is a motion to compel arbitration pending.  (See Greenland’s Opposition, pp. 11-13.)  Under these circumstances, the Court doubts that coordinating discovery and motion practice would produce the usual benefits and efficiencies.

D.        Efficient Use of Judicial Resources and Manpower

This factor favors denial.  For the reasons stated in sections II.A. and II.B, the threat of separate courts duplicating case efforts on the same issues and claims is low.

E.        Calendars of the Courts

This factor is neutral or favors denial.  Petitioners’ brief fails to address the individual court calendars.  (See Petitioner’s MP&A, pp. 9-12.)

F.         Duplicative and Inconsistent Rulings

This factor favors denial.  The analysis is the same as sections II.A., II.B., and II.D.  (See also Greenland’s Opposition, pp. 13-14.)

G.        Likelihood of Settlement in the Absence of Coordination

Petitioner argues:

. . . coordination in a single forum that permits all stakeholders to adjudicate their common claims and their common defenses will not only best serve the interests of justice, judicial economy, alleviate burdens on parties and witnesses, but also promote any possible resolution by way of compromise and settlement.  In the absence of coordination, Greenland’s ongoing efforts at piecemeal resolution will do little more than promote piecemeal compromise which by its very definition will not fully and finally resolve a dispute entirely caused by Greenland’s corporate malfeasance and nonfeasance.

(Petitioner’s Reply, p. 7.)

This factor is neutral or favors denial.  The inquiry is not whether coordination will promote settlement; it is whether settlement is expected “without further litigation should coordination be denied.” (Code Civ. Proc. § 404.1.)  Pariser is on appeal; Greenland is participating in an abatement arbitration right now; an arbitration motion is pending in Greenland; and none of the cases has settled.  The Court sees nothing in the record that suggests Defendants intend to settle prior to filing discovery motions and, possibly, motions for summary judgment.  Some additional litigation seems probable.  Given the predominating individual issues and minimal overlap, the Court believes coordination would have either no impact or a negative impact on settlement.

H.        Summary

On balance, the factors support denial.  The Court finds that coordination should be denied.

III.      Site for the Coordinated Proceedings

Rule of Court 3.530(b) sets forth the factors that the coordination motion judge may consider in making a recommendation for the site of the coordination proceedings. The factors include: the number of included actions in particular locations; whether the litigation is at an advanced stage in a particular court; the efficient use of court facilities and judicial resources; the locations of witnesses and evidence; the convenience of the parties and witnesses; the parties' principal places of business; the office locations of counsel for the parties; and the ease of travel to and availability of accommodations in particular locations.  (Cal. Rules of Court, rule 3.530(b).) 

In light of the preceding analysis, this issue is moot.

IV.       Stay Request

Petitioner does not request a stay.