Judge: H. Jay Ford, III, Case: 19SMCV02113, Date: 2022-09-15 Tentative Ruling

Case Number: 19SMCV02113    Hearing Date: September 15, 2022    Dept: O

Case Name:  Wurm v. Dobson, et al.

SUBJECT:                MOTION FOR SUMMARY JUDGMENT, OR IN THE ALTERNATIVE, SUMMARY ADJUDICATION OF (1) THE SINGLE CAUSE OF ACTION IN CASE NO 20STCV35079 AND (2) THE SINGLE CROSS-CLAIM AGAINST THEM FOR RESCISSION IN CONSOLIDATED CASE NO. 19SMCV02113

MOVING PARTY:  Plaintiffs/Cross-Defendants Porfirio Ballardo and Irene Ballardo

RESP. PARTY:        Defendants/Responding Parties Venice Terrace, LLC and Michael J. Dobson

TENTATIVE RULING

            Plaintiffs/Cross-Defendants Porfirio Ballardo and Irene Ballardo’s Motion for Summary Judgment, or in the Alternative Summary Adjudication is DENIED. 

            The Ballardos move for summary judgment or adjudication of (1) the sole cause of action in their complaint against Defendants Venice Terrace, LLC and Michael J. Dobson for breach of contract in 20STCV35079 and (2) the 3^rd cause of action for rescission in Venice Terrace LLC’s Amended Cross-Complaint in 19SMCV02113.

            The motion is moot as to the 3^rd cause of action for rescission in the Amended CROSS-Complaint.  Venice Terrace LLC dismissed the 3^rd cause of action for rescission against the Ballardos on 8-17-22. 

            The Court does not rule on Plaintiffs’ evidentiary objections per CCP §437c(q), as they are immaterial to the Court’s ruling. 

I.  Burden of plaintiff moving for summary judgment

            “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.” CCP §437c(p)(1).  

            “A party is entitled to summary judgment only if it meets its initial burden of showing there are no triable issues of fact and the moving party is entitled to judgment as a matter of law. This is true even if the opposing party fails to file any opposition.  The court's assessment of whether the moving party has carried its burden—and therefore caused a shift—occurs before the court's evaluation of the opposing party's papers.  Therefore, the burden on the motion does not initially shift as a result of what is, or is not, contained in the opposing papers.”  Mosley v. Pacific Specialty Insurance Company (2020) 49 Cal.App.5th 417, 434–435 (landlord’s failure to address issue of whether they were aware of their tenant’s marijuana growing operation was not grounds to grant summary judgment where moving party failed to satisfy its initial burden as to the issue); Thatcher v. Lucky Stores, Inc. (2000) 79 Cal.App.4th 1081, 1086-1087 (court cannot grant summary judgment based merely on lack of opposition; court must first determine if the moving party has satisfied its burden).  

            In addition, the evidence and affidavits of the moving party are construed strictly, while those of the opponent are liberally read.  See Government Employees Ins. Co. v. Sup. Ct. (2000) 79 Cal.App.4th 95, 100.  “All doubts as to the propriety of granting the motion (whether there is any issue of material fact [Code of Civil Procedure] § 437c) are to be resolved in favor of the party opposing the motion (i.e., a denial of summary judgment).”  Hamburg v. Wal-Mart Stores, Inc. (2004) 116 Cal.App.4th 497, 502.  

II.  Plaintiffs have failed to meet their burden to support an award of damages of pre-judgment interest.

            “To prevail on a cause of action for breach of contract, the plaintiff must prove (1) the contract, (2) plaintiff's performance of the contract or excuse for nonperformance, (3) defendant's breach, and (4) resulting damage to the plaintiff.”  Richman v. Hartley (2014) 224 Cal.App.4th 1182, 1186; CACI 303.

            Plaintiff establishes that the parties entered into a Side Letter Agreement date March 2, 2018.  See Plaintiffs’ SSUMF No. 5; Dec. of I. Ballardo, ¶8, Ex. 1.  Plaintiffs establish that under the Side Letter Agreement, Plaintiffs were required to reduce their escrow demand from $823,000 to $300,000 and Plaintiffs fulfilled this obligation.  See Plaintiff’s SSUMF Nos. 6 and 7 ; Dec. of I. Ballardo, ¶¶8 and 9, Ex. 1; Dec. of Gorham, ¶2, Ex. 47, 37:24-38:6. 

            Plaintiffs establish that Defendant Venice Terrace agreed to pay them $300,000 by May 1, 2018 under the Side Letter Agreement.  See Plaintiffs SSUMF No. 9, Dec. of I. Ballardo, ¶8, Ex. 1, Recital E.  Plaintiffs establish that Dobson executed the Side Letter Agreement and personally guaranteed Venice Terrace’s payment obligation thereunder.  See Plaintiffs’ SSUMF No. 10, Dec. of I. Ballardo, ¶8, Ex. 1, at ¶4. 

            Plaintiff establishes that Defendant failed to make the $300,000 payment under the Side Letter Agreement by May 1, 2018 or the orally extended deadline of July 1, 2018.  See Plaintiffs’ SSUMF Nos. 14-16; Dec. of I. Bllardo, ¶¶10, 12; Dec. of Gorham, Ex. 47, 38:12-39:6.  Plaintiffs establish that Defendant Venice Terrace made late payments to the Ballardos totaling $120,000.  See Dec. of I. Ballardo, ¶12. 

            Plaintiff fails to submit any evidence to support an award of prejudgment interest. Plaintiffs evidence only supports an award of the principle balance due of of $120,000. Plaintiffs’ complaint alleges damages in the amount of $180,000, plus prejudgment interest on that amount and interest on the Late Partial Payments of $120,000.  Plaintiff offers no evidence to show the amount of those additional sums and how they were calculated.  Plaintiffs were required to prove each element of their cause of action for breach of contract, which includes damages.  See CCP §437c(p)(1); CACI 303; Oasis West LLC v. Goldman (2011) 51 Cal.4^th 811, 821; Paramount Petroleum Corp. v. Supr. Ct. (2014) 227 CalApp.4^th 226, 242-243 (summary adjudication cannot be granted on the issue of liability with trial on damages alone).

            Plaintiffs have not dismissed or waived their claim to prejudgment interest or interest on the Late Partial Payments.  Plaintiffs confirm in their reply that they are requesting prejudgment interest on the $180,000.  Plaintiffs were required to submit evidence to substantiate any amount of prejudgment interest.  “It is well established that prejudgment interest is not a cost, but an element of damages.  This distinction persuades us that the cost bill is not an appropriate vehicle for requesting interest under section 3287. In our view, prejudgment interest should be awarded in the judgment on the basis of a specific request therefor made before entry of judgment.”  North Oakland Medical Clinic v. Rogers (1998) 65 Cal.App.4th 824, 830. 

            Evidence and briefing on the amount of prejudgment interest sought is especially crucial here, because there are two potential dates of breach—the May 1, 2018 due date under the Side Letter Agreement and the July 1, 2018 pursuant to the Plaintiffs’ verbal extension of the due date. Moreover, to the extent Plaintiffs seek interest on the Late Partial Payments, those Late Partial Payments were made in multiple installments on different dates, which would affect the interest calculation. 

            Plaintiffs’ Motion for Summary Judgment of the 1^st cause of action for breach of contract is DENIED.