Judge Gary Y. Tanaka, Case 19STCV05087 2023-02-22 Tentative Ruling

LOS ANGELES SUPERIOR COURT – SOUTHWEST DISTRICT

Honorable Gary Y. Tanaka Wednesday, February 22, 2023

Department B Calendar No. 8

Maria Cursage, Trustee of the Maria Cursage Trust v. Steve Larkin dba SRL Construction, et al.

Toal Engineering, Inc.’s (“Toal”) Motion for Summary Adjudication is denied.

Plaintiff filed the Complaint on February 19, 2019. Plaintiff’s Second Amended Complaint was filed on June 22, 2020. Plaintiff alleges the following facts. This case involves the alleged defective construction of Plaintiff’s multi-million-dollar home located at 38 Saddleback Road in Rolling Hills, California. The project consisted of the construction of an approximately 9,500 square foot single family residence as well as appurtenances, including hardscape, a swimming pool and spa, outdoor patios, barbeques, and other facilities, and landscaping, which was to be built pursuant to architectural and building plans provided to Defendant Steve Larkin. Defendant Larkin was the general contractor and construction manager on the project. Plaintiff alleges defects in construction and fraudulent overbilling practices. Plaintiff alleges the following causes of action: 1. Recovery of Damages Pursuant to SB 800; 2. Breach of Oral Contract; 3. Breach of Implied Warranty; 4. Fraud.

Several Cross-Complaints have been filed in this action including a Cross-Complaint filed by Toal Engineering Inc. against Maria Cursage (“Cursage”). Cross-Complainant alleged the following causes of action: 1. Express Indemnity 2. Equitable Indemnity 3. Contribution/Comparative Fault 4. Declaratory Relief – Duty to Defend 5. Declaratory Relief – Duty to Indemnify 6. Declaratory Relief 7. Declaratory Relief – Breach of Contract.

Toal’s objections to Cursage’s Responsive Separate Statement of Facts are overruled. Toal objected to Cursage’s statements set forth in her separate statement of facts rather than the specific pieces of evidence which were filed by Cursage in support of her separate statement of facts.

The purpose of a motion for summary judgment or summary adjudication “is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) “Code of Civil Procedure section 437c, subdivision (c), requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal. App. 4th 1110, 1119.)

“On a motion for summary judgment, the initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal. App. 4th 1510, 1519.) A defendant moving for summary judgment or summary adjudication “has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action . . . cannot be established, or that there is a complete defense to the cause of action.” CCP § 437c(p)(2). “Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” CCP § 437c(p)(2). “If the plaintiff cannot do so, summary judgment should be granted.” Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal. App. 4th 463, 467.

“A plaintiff or cross-complainant has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action. Once the plaintiff or cross-complainant has met that burden, the burden shifts to the defendant or cross-defendant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” Code Civ. Proc., § 437c(p)(1).

“When deciding whether to grant summary judgment, the court must consider all of the evidence set forth in the papers (except evidence to which the court has sustained an objection), as well as all reasonable inferences that may be drawn from that evidence, in the light most favorable to the party opposing summary judgment.” (Avivi, 159 Cal.App.4th at 467; CCP § 437c(c).)

Toal Engineering, Inc. moves for an order summarily adjudicating the following issue against Cross-Defendant Maria Cursage, trustee of the Maria Cursage Trust. Issue 1: “Cross-Complainant Toal is entitled to summary adjudication against Cross-Defendant Cursage as to Toal’s Fourth Cause of Action, as Cursage owes a contractual duty to defend Toal against the claims made by Defendant/Cross-Complainant Steve Larkin dba SRL Construction.” (Notice of Motion, page 2, lines 7-10.)

“The existence and scope of duty are legal questions for the court.” Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465, 477. “If any party moves for summary judgment or adjudication (Code Civ. Proc., § 437c) with respect to the duty to defend against litigation still in progress, the court may proceed as it deems expedient. For example, the court may resolve legal issues then ripe for adjudication, such as whether any of the contracts at issue include a duty to defend, and, if so, whether the underlying suit or proceeding as to which a defense is sought falls within the scope of any of the parties’ contractual duty to defend.” Crawford v. Weather Shield Mfg. Inc. (2008) 44 Cal.4th 541, 565, fn. 12.

“In the interpretation of a contract of indemnity, the following rules are to be applied, unless a contrary intention appears:

1. Upon an indemnity against liability, expressly, or in other equivalent terms, the person indemnified is entitled to recover upon becoming liable;

2. Upon an indemnity against claims, or demands, or damages, or costs, expressly, or in other equivalent terms, the person indemnified is not entitled to recover without payment thereof;

3. An indemnity against claims, or demands, or liability, expressly, or in other equivalent terms, embraces the costs of defense against such claims, demands, or liability incurred in good faith, and in the exercise of a reasonable discretion;

4. The person indemnifying is bound, on request of the person indemnified, to defend actions or proceedings brought against the latter in respect to the matters embraced by the indemnity, but the person indemnified has the right to conduct such defenses, if he chooses to do so;

5. If, after request, the person indemnifying neglects to defend the person indemnified, a recovery against the latter suffered by him in good faith, is conclusive in his favor against the former;

6. If the person indemnifying, whether he is a principal or a surety in the agreement, has not reasonable notice of the action or proceeding against the person indemnified, or is not allowed to control its defense, judgment against the latter is only presumptive evidence against the former;

7. A stipulation that a judgment against the person indemnified shall be conclusive upon the person indemnifying, is inapplicable if he had a good defense upon the merits, which by want of ordinary care he failed to establish in the action.”

If there is no contrary intention that is provided in the agreement, the indemnification provision would encompass a duty to defend. By specifying a duty to defend, Civil Code § 2778(4) places in every indemnity contract, unless the agreement provides otherwise, a duty to assume the indemnitee’s defense, if tendered, against all claims embraced by the indemnity. Crawford v. Weather Shield Mfg. Inc. (2008) 44 Cal.4th 541, 557. In UDC-Universal Dev., LP. v. CH2M Hill (2010) 181 Cal.App.4th 10, 17, the Court found that, under the indemnity provision, a sub-contractor owed a duty to defend the developer from the time the defense was tendered, even though the Complaint did not specifically allege negligence by the sub-contractor, and even though the jury found the sub-contractor not negligent. Id.

Toal identifies section 18 of the parties’ alleged agreement which states as follows: “If the scope of services contained in this agreement does not include construction-phase services for this project, Client acknowledges such construction-phase services will be provided by Client or by others and Client assumes all responsibility for interpretation of the contract documents and for construction observation and supervision and waives any claim against Consultant that may in any way be connected thereto. In addition, Client agrees, to the extent permitted by law, to indemnify and hold Consultant harmless from any loss, claim, or cost, including reasonable attorney’s fees and costs of defense, arising or resulting from the performance of such services by other persons or entities and from any and all claims arising from the modification, clarification, interpretation, adjustments or changes made to the contract documents to reflect changed field or other conditions, except for claims arising from the sole negligence or willful misconduct of Consultant.” (Decl., Caleb Rios, Ex. A.)

Toal argues that the duty to defend “is triggered by Larkin’s claims against Toal, because those claims largely if not entirely arise from the performance of construction-phase services by other parties.” (Motion, page 4, lines 3-5.) The Court finds that Toal has met its initial burden of showing that Cursage owed a duty to defend Toal against Larkin’s Cross-Complaint. CCP § 437c(f)(1). However, Cursage has met her burden to show the existence of a triable issue of material fact. Id.

A simple reading of the indemnity provision establishes that the duty to defend clause is not triggered because Larkin’s claims against Toal do not arise from the performance of construction related services. Here, Larkin is not alleging against Toal claims “arising from or resulting from the performance of such [construction-related] services by other persons or entities.” Nor is Larkin alleging claims against Toal “arising from the modification, clarification, interpretation, adjustments or changes made to the contract documents to reflect changed field or other conditions, . . .” Larkin is suing Toal for its own active negligence related to the grading and drainage plan services provided to the project. The indemnification provision above only applies claims made and arising from construction related services. Here, the claims against Toal do not arise from construction related services. In the Reply, Toal argues that the Plaintiff is reading this provision too narrowly. However, the provision itself is worded in a manner to support the narrow reading. The drafter of the provision could have eliminated the language concerning “construction related services” if the drafter intended a broader indemnification provision which would contemplate indemnification and a duty to defend in the manner argued by Toal.

Also, the indemnity provision, on its face, states that it would not apply to claims arising from Toal’s sole negligence or willful misconduct. Toal submitted no facts to show that the claims do not arise from its sole negligence or willful misconduct. Therefore, Cross-Defendant Cursage has met her burden to show the existence of a triable issue of material fact as to the fourth cause of action. (Cursage’s Additional Separate Statement of Facts and Supporting Evidence, 2-16, 19.)

Thus, for the foregoing reasons, Toal’s motion for summary adjudication is denied.