Judge Gregory Keosian, Case 19STCV21127 2023-03-07 Tentative Ruling

Plaintiffs Sina and Azadeh Mardani’s Motions for Leave to File an Amended Answer and Supplemental and Amended Complaint are GRANTED.

The court may, in furtherance of justice, and on any terms as may be proper, allow a party to amend any pleading or proceeding by adding or striking out the name of any party, or by correcting a mistake in the name of a party, or a mistake in any other respect; and may, upon like terms, enlarge the time for answer or demurrer. The court may likewise, in its discretion, after notice to the adverse party, allow, upon any terms as may be just, an amendment to any pleading or proceeding in other particulars; and may upon like terms allow an answer to be made after the time limited by this code.

“The trial court has discretion to permit or deny the amendment of the complaint, but instances justifying the court's denial of leave to amend are rare.” (Armenta ex rel. City of Burbank v. Mueller Co. (2006) 142 Cal.App.4th 636, 642.)

“Although courts are bound to apply a policy of great liberality in permitting amendments to the complaint at any stage of the proceedings, up to and including trial [Citations], this policy should be applied only ‘[w]here no prejudice is shown to the adverse party . . .’ [Citation.] A different result is indicated ‘[w]here inexcusable delay and probable prejudice to the opposing party’ is shown. [Citation.]” (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 487.)

Pursuant to California Rule of Court Rule 3.1324, “[a] motion to amend a pleading before trial must: (1)Include a copy of the proposed amendment or amended pleading, which must be serially numbered to differentiate it from previous pleadings or amendments; (2) State what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph, and line number, the deleted allegations are located; and (3)State what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located.”

Such a motion must include a supporting declaration stating, “(1) The effect of the amendment; (2) Why the amendment is necessary and proper; (3) When the facts giving rise to the amended allegations were discovered; and (4) The reasons why the request for amendment was not made earlier.” (CRC Rule 3.1324, subd. (b).)

Plaintiffs Sina Mardani and Azadeh Mardani (Plaintiffs) seek leave to file an amended answer and a supplemental, amended complaint. The proposed amended answer is to allege new affirmative defenses against County of Los Angeles’s (Defendant) complaint for breach of contract for lack of consideration, impossibility, misrepresentation, unclean hands, voidness, and unconscionability. (Bahar Decl. ¶¶ 6–11.) The consideration defense is based on inadequate payments included in the settlement agreement underlying Defendant’s contract claim for the installation of a backwater valve. (Bahar Decl. ¶ 6.) The impracticability defense is based on the contention that installing a backwater valve would not prevent sewage overflows through the sewer main line maintained by the county. (Bahar Decl. ¶ 7.) The misrepresentation defense is based on the contention that Defendant misrepresented the cause of the 2013 sewage overflow as being root blockage, when in reality there were structural problems. (Bahar Decl. ¶ 8.) The unclean hands defense is based on the contention that Defendant obtained Plaintiffs’ signature on one version of the settlement agreement, then had them sign a second version including an attorney fee provision favorable to Defendant. (Bahar Decl. ¶ 9.) Plaintiff contend these defenses are based on new evidence acquired in 2022 concerning installation estimates of a backwater valve, and the obtaining of documents from other sources regarding negotiations on the settlement and earlier versions of the same. (Bahar Decl. ¶¶ 6–11.)

Defendant argues that these defenses open new fields of inquiry into the facts surrounding the formation of the settlement agreement, and that Plaintiffs do not articulate a reasonable basis for delaying amendment here when they ought to have known the facts of the contract’s formation from the outset of the case. (Opposition at pp. 10–11.) Defendant also argues that it will suffer prejudice, as Defendant will need to take a new deposition of Sina Mardani, who has already been deposed. (Opposition at p. 10.) Defendant also contends that new affirmative defenses would impede the upcoming settlement conference in June 2023. (Opposition at p. 10.) Defendant further argues that the motion does not state by line and page number where new additions are proposed, or provide a red-lined copy of the proposed pleading, and that the accompanying declaration does not state when the facts supporting each defense were learned, and not alleged sooner. (Opposition at pp. 8–9.) Defendant further argues that each defense is inadequately pleaded. (Opposition at pp. 12–14.)[1]

Plaintiffs have presented sufficient justification for the timing of the present motion. The new defenses are based on documentary information obtained from Defendant and other sources in the previous year. (Bahar Decl. ¶¶ 6–9.) As to prejudice, the only concrete item of prejudice identified by Defendant is the necessity of obtaining leave to re-depose Sina Mardani. Time remains to conduct discovery in this action, as trial is set for August 29, 2023, and discovery remains open in relation to that date. Plaintiffs in reply express willingness to produce Sina Mardani for deposition concerning any new matters, Although the affirmative defenses do raise some new matters, they address the same circumstances that are addressed in Plaintiff’s other affirmative defenses, such as the second affirmative defense for failure to disclose and the sixth affirmative defense for equitable estoppel. Finally, although Defendant contends the defenses are inadequate, “[t]he preferable practice [is] to permit the amendment and allow the parties to test its legal sufficiency by demurrer, motion for judgment on the pleadings or other appropriate proceedings.” (Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048.)

The motion is therefore GRANTED as to the motion for leave to file an amended answer.

Plaintiffs also seek leave to file an amended complaint including supplemental allegations related to a sewer overflow that occurred in October 2022, as well as new facts concerning Defendant’s knowledge of a structural defect in the sewer main line that was not disclosed to Plaintiffs before the execution of the 2013 settlement agreement. (Bahar Decl. ¶¶ 5–13.) Defendant in opposition contends that allowing leave to amend to allege facts as to the October 2022 overflow — including the addition of Sohrab Mardani as a new plaintiff, who has allegedly suffered illness as a result of the overflow — would prejudice Defendant by requiring new discovery and likely the continuance of trial. (Opposition at pp. 5–7.)

“The plaintiff and defendant, respectively, may be allowed, on motion, to make a supplemental complaint or answer, alleging facts material to the case occurring after the former complaint or answer.” (Code Civ. Proc. § 464, subd. (a).) Supplemental pleadings for “occurring-after” facts are permitted with “liberality.” (Flood v. Simpson (1975) 45 Cal.App.3d 644, 647.) The facts that Plaintiff allege here will inevitably require additional discovery, and may require continuance of trial, as Defendant notes. But Plaintiffs in reply express no resistance to rescheduling trial to allow for discovery concerning these new facts. (Reply at p. 2.) Although Defendant argues that a new trial date and a further deposition of Sina Mardani should be included in this court’s order as a condition for granting Plaintiffs’ motion, there is little reason to believe that the parties cannot confer and come to agreement concerning the any further discovery and trial continuance.

[1] Defendant also submits objections to the declaration of Plaintiffs’ counsel on the grounds that he lacks personal knowledge of the evidence that he describes. (Opposition at pp. 14–16.) But the attorney declaration is sufficient for the purposes of that required under CRC Rule 3.1324, which is to state why the amendment is sought and the facts giving rise to same. Defendant’s objections are OVERRULED.