Judge: Holly J. Fujie, Case: 21STCV12788, Date: 2023-04-21 Tentative Ruling

Case Number: 21STCV12788    Hearing Date: April 21, 2023    Dept: 56

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES - CENTRAL DISTRICT

MOVING PARTY: Defendant Move Sales, Inc. (“Move Defendant”)

RESPONDING PARTY: Plaintiffs

The Court has reviewed the moving, opposition and reply papers.

BACKGROUND

This action arises out of the alleged breach of a contractual relationship.  On April 2, 2021, Plaintiffs filed a complaint (the “Complaint”) alleging: (1) breach of contract; and (2) unfair competition. 

On February 17, 2023, Moving Defendant filed a motion for leave to file a cross-complaint (the “Motion”).  Moving Defendant seeks to file a cross-complaint (the proposed “XC”) against Plaintiffs alleging: (1) breach of contract; (2) account stated; and (3) goods and services rendered.  (See Declaration of Michael G. King (“King Decl.”) ¶ 3, Exhibit A.) 

DISCUSSION

California Code of Civil Procedure (“CCP”) section 426.30, subdivision (a) provides that a party against whom a complaint has been filed and served who fails to allege in a cross-complaint any related cause of action which, at the time of serving his answer to the complaint, he has against the plaintiff may not thereafter assert the unpleaded related cause of action against the plaintiff in any other action.  (CCP § 426.30, subd. (a).)  A related cause of action is a cause of action which arises out of the same transaction, occurrence, or series of transactions or occurrences as the cause of action which the plaintiff alleges in his complaint.  (CCP § 426.10, subd. (c).) 

CCP section 426.50 provides that the court, after notice to the adverse party, shall grant, upon such terms as may be just to the parties, leave to amend a pleading or to file a cross-complaint.  A policy of liberal construction of CCP section 426.50 to avoid forfeiture of causes of action is imposed on the trial court.  (Silver Organizations Ltd. v. Frank (1990) 217 Cal.App.3d 94, 98-99.)  A motion for leave to file a cross-complaint at any time during the course of the action must be granted unless bad faith of the moving party is demonstrated where forfeiture would otherwise result.  (Id. at 99.)  Factors such as oversight, inadvertence, neglect, mistake or other cause are insufficient grounds to deny the motion unless accompanied by bad faith.  (Id.)  Bad faith is defined as the opposite of “good faith,” generally implying or involving actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation, not prompted by an honest mistake, but by some interested or sinister motive, not simply bad judgment or negligence, but rather the conscious doing of a wrong because of dishonest purpose or moral obliquity.  (Id. at 100.)  Substantial evidence must support the court’s decision that a defendant has not acted in good faith.  (Id. at 99.)

In support of the Motion, Moving Defendant provides evidence that it did not seek leave to assert its cross-claims against Plaintiffs earlier in the litigation in hopes that the matter would settle before the trial.  (See King Decl. ¶¶ 3-4.)  In their opposition (the “Opposition”), Plaintiffs do not dispute the proposed XC is a compulsory cross-complaint; instead, Plaintiffs argue that Moving Defendant belatedly decided to pursue its claims in bad faith in order to drive up litigation costs and prejudice Plaintiffs.  The Court finds that the Opposition does not set forth substantial evidence that Moving Defendant did not file the Motion in good faith.  The Court therefore GRANTS the Motion.  The trial date is continued to February 13, 2024 at 9:30 a.m. in this department and the Final Status Conference is continued to February 6, 2024 at 8:30 a.m. in this department.  All pre-trial deadlines are reset based upon the new trial date.  Moving Defendant is ordered to file the proposed XC within five court days.

Moving party is ordered to give notice of this ruling. 

In consideration of the current COVID-19 pandemic situation, the Court¿strongly¿encourages that appearances on all proceedings, including this one, be made by LACourtConnect if the parties do not submit on the tentative.¿¿If you instead intend to make an appearance in person at Court on this matter, you must send an email by 2 p.m. on the last Court day before the scheduled date of the hearing to¿SMC_DEPT56@lacourt.org¿stating your intention to appear in person.¿ The Court will then inform you by close of business that day of the time your hearing will be held. The time set for the hearing may be at any time during that scheduled hearing day, or it may be necessary to schedule the hearing for another date if the Court is unable to accommodate all personal appearances set on that date.¿ This rule is necessary to ensure that adequate precautions can be taken for proper social distancing.

Parties who intend to submit on this tentative must send an email to the Court at SMC_DEPT56@lacourt.org as directed by the instructions provided on the court website at www.lacourt.org.  If the department does not receive an email and there are no appearances at the hearing, the motion will be placed off calendar. 

  Dated this 21st day of April 2023