Judge: H. Jay Ford, III, Case: 21SMCV01885, Date: 2023-02-28 Tentative Ruling

Case Number: 21SMCV01885    Hearing Date: February 28, 2023    Dept: O

  Case Name:  5916 S. Village Dr. LLC v Flying Tigers, Inc., et al.

Case No.:                    21SMCV01885            

Complaint Filed:                   12-1-21

Hearing Date:            2-28-23

Discovery C/O:                     N/A

Calendar No.:            4

Discover Motion C/O:          N/A

POS:                           OK

Trial Date:                             8-8-22

SUBJECT:                MOTION FOR ATTORNEY’S FEES

MOVING PARTY:   Defendant Flying Tigers, Inc.

RESP. PARTY:         Plaintiff 5916 S. Village Dr. LLC

 

TENTATIVE RULING

            Defendant Flying Tigers, Inc.’s Motion for Attorney’s Fees is DENIED.  Defendant has already exceeded the cap on recoverable fees and costs under ¶36 of the Lease Agreement. Plaintiff establishes that it denied the subject RFAs based on a reasonable good faith belief grounded in evidence. 

 

            Plaintiff filed this UD action on 12-1-21 based nonpayment of rent under the lease agreement.  Defendant obtained a judgment in its favor on 8-16-22 after jury trial.  Judgment was entered on 9-19-22. 

 

I.  Defendant is limited to recovery of $1000 in fees and costs under ¶36 of the Lease Agreement and it has already recovered $5,012.91 in uncontested costs

 

            Under ¶36 of the Lease Agreement, Defendant is entitled to a maximum of $1000 in reasonable attorney’s fees and costs capped at $1000 “In any action or proceeding arising out of this Agreement, the prevailing party between Landlord and Tenant shall be entitled to reasonable attorney’s fees and costs, collectively not to exceed $1,000 (or $___________), except as provided in paragraph 35A.”  See Motion, Ex. 4.  Defendant has already been awarded $5,012.91 in uncontested costs pursuant to its memo of costs filed on 9-21-23.  Defendant is therefore not entitled to recover any fees under ¶36 of the Lease Agreement.

 

II.  Defendant not entitled to cost of proof sanctions under CCP §2033.420, because Plaintiff establishes that it had a reasonable basis to deny the subject RFAs


            A. Applicable Law

 

            Showing required to recover sanctions by moving party.  “If a party fails to admit the genuineness of any document or the truth of any matter when requested to do so under this chapter, and if the party requesting that admission thereafter proves the genuineness of that document or the truth of that matter, the party requesting the admission may move the court for an order requiring the party to whom the request was directed to pay the reasonable expenses incurred in making that proof, including reasonable attorney's fees.”  CCP §2033.420(a).

 

            The party seeking cost of proof sanctions under CCP §2033.420(a) must show they spent the amounts claimed to prove the issues that should have been admitted.  See Grace v. Mansourian (2015) 240 Cal.App.4th 523, 530.  The requested amounts must be segregated from costs and fees expended to prove other issues.  Id. 

 

            Costs of proof sanctions “are recoverable only where the moving party actually proves the matters that are the subject of the requests.  Further, those amounts cannot be awarded if the parties stipulated to facts, even if the responding party had previously denied them.  The purpose of requests for admission is to expedite trial and a stipulation achieves that goal.”  Id.

 

            Exceptions to sanctions award.  “The court shall make this order unless it finds any of the following:  (1) an objection the request was sustained or a response to it was waived under Section 2033.290. (2) The admission sought was of no substantial importance. (3) The party failing to make the admission had reasonable ground to believe that the party would prevail on the matter. (4) There was other good reason for the failure to admit.”  CCP §2033.420(b). 

 

            “The party seeking to benefit from an exception listed in section 2033.420, subdivision (b) bears the burden to establish the exception.  In evaluating whether a ‘good reason’ exists for denying a request to admit, a court may properly consider whether at the time the denial was made the party making the denial held a reasonably entertained good faith belief that the party would prevail on the issue at trial.  A party's reasonable belief must be grounded in the evidence; it cannot be based merely on hope or a roll of the dice.  It is also not enough for a party making the denial to hotly contest the issue; instead, there must be some reasonable basis for contesting the issue in question before sanctions can be avoided.  A party's reliance on ‘self-serving testimony’ may be insufficient to establish a reasonable refusal to admit a request for admission.”  Spahn v. Richards (2021) 72 Cal.App.5th 208, 216–217 (plaintiff had no reasonable basis to believe that he would prevail on issue of existence of oral agreement with defendant where plaintiff’s undisputed statements during the time the oral agreement was allegedly formed, admitted that there was no such agreement); Doe v. Los Angeles County Dept of Children & Family Services (2019) 37 Cal.App.5th 675, 691 (plaintiff did not reasonably deny the RFAs where she did not conduct reasonable investigation to answer them); Gracie v. Mansourian (2015) 240 Cal.App.4th 523, 532 (defendant did not have reasonable belief that he would prevail on issue of his liability for car accident at trial where plaintiff and witnesses testifies that defendant ran through a red light, police report indicated defendant ran through red light, plaintiff’s accident reconstruction expert indicated he ran through a red light and defendant did not have any expert testimony on the issue, nor did defendant ever testify that he saw the color of the light when he actually went through the intersection).

 

            B.  Application to facts

           

            Defendant propounded RFAs pertaining to nonpayment of rent, the basis of the UD action. In RFA Nos. 5, 9, 15, 24, 26 and 27, Defendant asked Plaintiff to admit that Defendant did not owe Plaintiff any rent and Plaintiff was not entitled to any rent sought in the UD action.  See Motion, Dec. of R. Jacobs, Ex. 1, RFAs (set one) and Plaintiff’s responses.  Plaintiff denied these RFAs and the jury ultimately found that Defendant did not fail to make any rental payments during the relevant period identified in the 15-day notice.  Id. at Ex. 2.  Defendants therefore establish that they proved the matters denied in the RFAs.

 

            In opposition, Plaintiff establishes that it “held a reasonably entertained good faith belief that the party would prevail on the issue at trial.”  Based on the evidence presented at trial, Plaintiff’s good faith belief was grounded in evidence.  Moreover, the Court recalls that prior to trial the Defendant’s counsel sought to challenge Plaintiff’s ownership and suggested the monies Plaintiff received by Plaintiff was not paid for rent; but rather, was payment toward the defendant’s purchase of the property.  Other than cross-examining Mr.  At trial, other than cross-examining Mr. Mohamed Shaaban, defendant presented no evidence that the funds Defendant sent to Plaintiff were intended to be payment of rent. Only because The Court refused defendant’s request to try issues of title, the Defendant then shift it position to argue those funds were paid as rent.  The Court is not satisfied that Mr. Shaaban did not have a good faith belief Plaintiff would prevail at trial when the requests for admission were denied.