Judge: Elaine Lu, Case: 20STCV35045, Date: 2023-08-25 Tentative Ruling

Case Number: 20STCV35045    Hearing Date: October 23, 2023    Dept: 26

Superior Court of California

County of Los Angeles

Department 26

Procedural Background

On September 14, 2020, Plaintiff Michael Talley (“Plaintiff”) filed the instant breach of construction contract action against defendants Ramon Cartznes dba Precision Construction Experts, Inc. (“Cartznes”), Precision Construction Experts, Inc. (“Precision”), Stephen Andrew Myers (“Myers”), Alliance Insurance Company, Old Republic Surety Company, and Leon Krous Drilling, Inc.[1] 

            On November 10, 2021, Plaintiff filed the operative Fifth Amended Complaint (“5AC”) against Cartznes, Precision, Myers, Business Alliance Insurance Company (“BAIC”), Old Republic Surety Company, and Leon Krous Drilling, Inc.  The 5AC asserts five causes of action for (1) Breach of Contract against Defendants Cartznes, Precision, and Myers; (2) Unfair Practices against Defendants Cartznes, Precision, and Myers; (3) Penal Code § 496 against Defendants Cartznes, Precision, and Myers; (4) Negligence against Defendants Cartznes, Precision, and Myers; and (5) Foreclosure on Surety Bonds against Defendants Cartznes, Precision, Myers, BAIC, and Old Republic Surety Company.[2]

            On September 28, 2023, Defendants Cartznes, Precision, and Myers (collectively “Moving Defendants”) filed the instant motion to bifurcate trial.  On October 13, 2023, Plaintiff filed a response.  No reply has been filed.

Legal Standard

“The court, in furtherance of convenience or to avoid prejudice, or when separate trials will be conducive to expedition and economy, may order a separate trial of any cause of action, including a cause of action asserted in a cross-complaint, or of any separate issue or of any number of causes of action or issues, preserving the right of trial by jury required by the Constitution or a statute of this state or of the United States.”  (CCP § 1048(b).)  Whether there shall be a severance and separate trials of issues in a single action is a matter within the trial court’s discretion. (McArthur v. Shaffer (1943) 59 Cal.App.2d 724, 727.)

Where a separate trial is ordered on the issue of liability, the procedure is commonly referred to as “bifurcation.”  The objective of bifurcation is to avoid wasting time and money on the trial of damages issues if the liability issue is resolved against plaintiff.  (Horton v. Jones (1972) 26 Cal.App.3d 952, 954.)  Granting or denying of a motion for bifurcation lies within the trial court’s sound discretion and is subject to reversal on appeal only for clear abuse.  (Grappo v. Coventry Financial Corp. (1991) 235 Cal.App.3d 496, 503-504.) 

Discussion

            Moving Defendants seek to bifurcate trial as to the prayer  for punitive damages.

Right to Bifurcate Punitive Damages for Trial

            Pursuant to Civil Code section 3295(d), “[t]he court shall, on application of any defendant, preclude the admission of evidence of that defendant's profits or financial condition until after the trier of fact returns a verdict for plaintiff awarding actual damages and finds that a defendant is guilty of malice, oppression, or fraud in accordance with Section 3294. Evidence of profit and financial condition shall be admissible only as to the defendant or defendants found to be liable to the plaintiff and to be guilty of malice, oppression, or fraud. Evidence of profit and financial condition shall be presented to the same trier of fact that found for the plaintiff and found one or more defendants guilty of malice, oppression, or fraud.”  (Id.)  “While the statute refers only to evidence of the defendant's financial condition, in practice bifurcation under this section means that all evidence relating to the amount of punitive damages is to be offered in the second phase, while the determination whether the plaintiff is entitled to punitive damages (i.e., whether the defendant is guilty of malice, fraud or oppression) is decided in the first phase along with compensatory damages.”  (Holdgrafer v. Unocal Corp. (2008) 160 Cal.App.4th 907, 919.)

            “As an evidentiary restriction, section 3295(d) requires a court, upon application of any defendant, to bifurcate a trial so that the trier of fact is not presented with evidence of the defendant's wealth and profits until after the issues of liability, compensatory damages, and malice, oppression, or fraud have been resolved against the defendant. Bifurcation minimizes potential prejudice by preventing jurors from learning of a defendant's ‘deep pockets’ before they determine these threshold issues.”  (Torres v. Automobile Club of So. California (1997) 15 Cal.4th 771, 777–778.) 

            Here, Plaintiff seeks punitive damages against Moving Defendants.  (See e.g., 5AC ¶ 30, 5AC Prayer ¶¶ 2, 7.)  Accordingly, Moving Defendants are entitled to a bifurcation of trial such that evidence of the Moving Defendants’ wealth, profits, and financial condition is not heard until after the issues of liability, compensatory damages, and malice, oppression, or fraud have been resolved against Moving Defendants.  (Torres, supra, 15 Cal.4th at pp.777–778.)  Moreover, Plaintiff has responded that Plaintiff does not oppose the instant motion. 

CONCLUSION AND ORDER

            Based on the foregoing, Defendants Ramon Cartznes dba Precision Construction Experts, Inc., Precision Construction Experts, Inc., and Stephen Andrew Myers’ motion to bifurcate is GRANTED. 

            Plaintiff Michael Talley’s prayer for punitive damages is bifurcated for purposes of trial, and evidence regarding Defendants Ramon Cartznes dba Precision Construction Experts, Inc., Precision Construction Experts, Inc., and Stephen Andrew Myers’ financial condition is precluded unless and until a verdict is reached awarding actual damages on Plaintiff’s claims seeking punitive damages and finding that Defendant acted with oppression, fraud, or malice.

DATED: October ___, 2023                                                  ___________________________

                                                                                          Elaine Lu

                                                                                    Judge of the Superior Court