Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 205 

 

 

MOVING PARTY: Defendant Negative Asset L.P.  

 

RESPONDING PARTY: Plaintiff 7th Street Associates Inc., as General Partner of Lance Jay Robbins Paloma Partnership 

 

BACKGROUND 

This case arises from the alleged breach of a partnership agreement.  Plaintiff 7th Associates Inc. is the general partner of Lance Jay Robbins Paloma Partnership (“the Partnership”).  (Compl. ¶7.)  Defendants Duane Weaver and Negative Asset L.P. are each limited partners of the Partnership.  (Id.)  The sole asset of the partnership is a 58 unit apartment building located at 15 Paloma Avenue, Venice, California, commonly referred to as the Ellison. 

The partnership agreement for the Partnership was amended and restated on October 23, 2015 and further amended on July 20, 2019 (the “Amendment”).  (Id.)  The Amendment states Defendants owe the Partnership for past capital contributions of $219,495.94 and future capital contributions of $361,326, plus interest at 10%.  (Id. ¶¶ 9, 10.)  The Amendment requires that Defendants pay the foregoing amounts by 26 months after July 20, 2019, making the payments due on September 20, 2021.  (Id. ¶11.)   

The operative complaint was filed on June 20, 2023 (the “7th Street Case”) and alleges a single claim for breach of contract based on Defendants’ alleged failure to pay their capital contributions within the agreed time period.  (Id. ¶15.)  

Over a month before the operative complaint was filed, on May 10, 2023, Negative Asset sued 7th Street, the Partnership and Lance Jay Robbins who is the managing partner of the Partnership (the “Negative Asset Case”).  Negative Asset alleges 7th Street and Robbins grossly mismanaged the Ellison so that it has fallen into disrepair, is the subject of numerous city violations and orders, and is the target of multiple lawsuits and legal proceedings relating to its operation.  Negative Asset further alleges 7th Street and Robbins failed to make required distributions to Negative Asset, claiming insufficient cashflow when 7th Street received its monthly distributions even though Negative Asset was not paid.  Negative Asset also alleges 7th Street and Robbins have billed and demanded payment for grossly inflated capital expenditures in an effort to avoid paying monthly distributions to Negative Asset.        

This hearing is on Negative Asset’s (“Moving Defendant’s”) demurrer to the complaint.  Moving Defendant argues that (1), there is another action pending between the same parties on the same cause of action, and therefore the complaint in this action is barred under Code Civ. Proc. § 430.10 and the rule of exclusive concurrent jurisdiction and (2) the complaint fails to properly set forth the terms of the written contract it alleges was breached or attach a copy of the contract to the complaint.  No opposition was filed as of the posting of this tentative ruling.   

LEGAL STANDARD 

“[A] demurrer tests the legal sufficiency of the allegations in a complaint.” (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.)  A demurrer can be used only to challenge defects that appear on the face of the pleading under attack or from matters outside the pleading that are judicially noticeable.  (See Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994 (in ruling on a demurrer, a court may not consider declarations, matters not subject to judicial notice, or documents not accepted for the truth of their contents).)  For purposes of ruling on a demurrer, all facts pleaded in a complaint are assumed to be true, but the reviewing court does not assume the truth of conclusions of law. (Aubry v. Tri-City Hosp. Dist. (1992) 2 Cal.4th 962, 967.)  

A demurrer to a complaint may be general or special.¿ A general demurrer challenges the legal sufficiency of the complaint on the ground it fails to state facts sufficient to constitute a cause of action. (Code Civ. Proc., § 430.10, subd. (e).)¿ A special demurrer challenges other defects in the complaint, including whether a pleading is uncertain. (Code Civ. Proc., § 430.10, subd. (f).)¿ The term uncertain means “ambiguous and unintelligible.”¿ (Id.)¿ A demurrer for uncertainty should be sustained if the complaint is drafted in such a manner that the defendant cannot reasonably respond, i.e., the defendant cannot determine what issues must be admitted or denied, or what counts are directed against the defendant. (Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 616.)¿ 

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (court shall not “sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment”); Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037 (“A demurrer should not be sustained without leave to amend if the complaint, liberally construed, can state a cause of action under any theory or if there is a reasonable possibility the defect can be cured by amendment.”).)  The burden is on the complainant to show the Court that a pleading can be amended successfully. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) 

MEET AND CONFER 

Code Civ. Proc. § 430.41 requires that before the filing of a demurrer the moving party “shall meet and confer in person or by telephone” with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.  (Code Civ. Proc. § 430.41(a).)  The parties are to meet and confer at least five days before the date the responsive pleading is due. (Code Civ. Proc. § 430.41(a)(2).)  Thereafter, the moving party shall file and serve a declaration detailing their meet and confer efforts. (Code Civ. Proc. § 430.41(a)(3).)  Moving Defendant submits the Declaration of Lisa G. Salisbury, which shows the parties met and conferred by telephone.  This satisfies the meet and confer requirements of Code Civ. Proc. § 430.41. 

   

REQUEST FOR JUDICIAL NOTICE 

 Moving Defendant requests judicial notice of a complaint filed by it against 7th Street and the Partnership in Case No. 23STCV10614 (the “Negative Asset Case”).  The Court grants the request pursuant to Evid. Code §§ 452(d) and 453.   

DISCUSSION 

Moving Defendant argues that the entire complaint is subject to demurrer because there is another (earlier filed) action involving the same parties and the same transaction.¿ The Court agrees.¿¿¿ 

Pursuant to Code Civ. Proc. § 430.10(c), a defendant may demur to a complaint if “[t]here is another action pending between the same parties on the same cause of action.”¿ (Plant Insulation Co. v. Fibreboard Corp. (1990) 224 Cal.App.3d 781.)¿¿¿¿¿¿ 

Here, Moving Defendant filed an earlier complaint based on the same transaction, breach of the partnership agreement, and over the same facts, 7th Street and the Partnership’s alleged “grossly inflated” demand for capital contributions.  Accordingly, these claims are subject to demurrer pursuant to § 430.10(c).   

Lawyers Title Ins. Corp. v. Superior Court (1984) 151 Cal.App.3d 456, is instructive.  There the parties were involved in two lawsuits, first a San Francisco lawsuit for declaratory relief, and second a Santa Clara lawsuit for money damages.  A defendant in the San Francisco lawsuit brought the later Santa Clara lawsuit as the Plaintiff.  Both suits arose out of the same transaction involving Lawyer Title’s liability to its insureds as escrow holder and title insurer of two lots of commercial real property.  Even though the claims were not identical – one seeking declaratory relief and the other seeking monetary damages, the Court held that abatement was appropriate.  (Id. at 458.)  ¿The Court noted there was no obstacle to preclude the Plaintiff in the Santa Clara action from filing a cross-complaint in the San Francisco action and from securing a determination of all issues.  (Id. at 459.) 

As in Lawyers Title, the two actions here arise out of the same transaction, involving alleged breaches of the Partnership Agreement.  While the parties are not in the same sides of the v. in both cases and the causes of action are different, there is no barrier to 7th Street asserting the same breach of contract claim as a cross-complaint in the Negative Asset Case so that the earlier filed action can resolve all issues.   

Moreover, under the doctrine of exclusive concurrent jurisdiction, when two or more courts have subject matter jurisdiction over a dispute, the court that first asserts jurisdiction assumes it to the exclusion of the others.¿ (Franklin & Franklin v. 7-Eleven Owners for Fair Franchising¿(2000) 85 Cal.App.4th 1168, 1175.)¿ The rule is based upon the public policies of avoiding conflicts that might arise between courts if they were free to make contradictory decisions or awards relating to the same controversy and preventing vexatious litigation and multiplicity of suits.¿ (BBBB Bonding Corp. v. Caldwell¿(2021) 73 Cal.App.5th 349, 374.)¿ 

“‘Although the rule of¿exclusive jurisdiction is similar in effect to the statutory plea in abatement [Code Civ. Proc., § 430.10, subd. (c)], it has been interpreted and applied more expansively, and therefore may apply where the narrow grounds required for a statutory plea [in] abatement do not exist. [Citation.]¿ Unlike the statutory plea [in] abatement, the rule of¿exclusive concurrent jurisdiction¿does not require absolute identity of parties, causes of action or remedies sought in the initial and subsequent actions. [Citations.]¿ If the court exercising original jurisdiction has the power to bring before it all the necessary parties, the fact that the parties in the second action are not identical does not preclude application¿of the rule.¿ Moreover, the remedies sought in the separate actions need not be precisely the same so long as the court exercising original jurisdiction has the power to litigate all the issues and grant all the relief to which any of the parties might be entitled under the pleadings.’”¿ (People ex rel. Garamendi¿v. American Autoplan, Inc.¿(1993) 20 Cal.App.4th 760, 770.)¿ Where the¿exclusive concurrent jurisdiction rule applies, the second action should be stayed.¿(Id.¿at 771.)¿¿¿ 

Here, the allegations in the Negative Asset Case and 7th Street Case arise out of the same transaction and involve the same facts relating to alleged breaches of the Partnership Agreement.  Accordingly, the Court stays this action and declines to consider the other arguments raised by Moving Defendant for a demurrer.¿¿¿¿ 

CONCLUSION 

For the foregoing reasons, the Court SUSTAINS the demurrer without leave to amend. 

The Court stays the current action pending resolution of the earlier filed action in 23STCV10614.  The Court sets a case management conference for February 29, 2024 at 9:00 a.m., to determine the status of the earlier filed action. 

 

DATED:  November 2, 2023 ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court