Judge: James C. Chalfant, Case: 22STCV39344, Date: 2023-01-12 Tentative Ruling

Case Number: 22STCV39344    Hearing Date: January 12, 2023    Dept: 85

Shipflex Logistics LLC v. Pilot Inc. and Calvin Wang, 22STCV39344
Tentative decision on applications for preliminary injunction enjoining self-help eviction efforts:  granted


 

           

            Plaintiff Shipflex Logistics LLC (“Shipflex”) applies for a preliminary injunction enjoining Defendants Pilot Inc. (“Pilot”) and Calvin Wang (“Calvin”) from using self-help to evict Shipflex from 13000 Temple Avenue, City of Industry, CA 91746 (“Property”).

            The court has read and considered the moving papers, opposition,[1] and reply, and renders the following tentative decision.

 

            A. Statement of the Case

            1. Complaint

            Plaintiff Shipflex filed its Complaint on December 17, 2022, alleging (1) breach of lease, (2) breach of the covenant of quiet enjoyment, (3) intentional interference with prospective economic enjoyment, and (4) violation of Business and Professions Code section 17200 (“Section 17200”).  The Complaint alleges in pertinent part as follows.

            Shipflex operates a warehouse on the Property.  On March 7, 2022, Shipflex entered into an Operating Services Agreement (“Agreement”) to rent the Property from Pilot for 60 months.  Shipflex performed all obligations under the Agreement.

            From May 2022, Pilot has engaged in increasing harassment as a form of self-help to induce Shipflex to leave the Property, which Shipflex believes has occurred because Pilot received offers of higher rent payments.  Pilot has (1) blocked access to the Property with automobiles, trailers, and pallets, (2) billed for utilities which Pilot is liable to pay under the Agreement and threatened to stop cleaning restrooms if Shipflex does not pay, and (3) assigned 30 truck parking spaces to unrelated third parties which are designated for Shipflex.

            On November 5, 2022, Pilot locked Shipflex out of the Property.  On December 5, 2022, Pilot cut off the electricity. Pilot then demanded that Shipflex sign an “Operating Services Termination Agreement” (“Termination Agreement”) before it would restore electricity.  Pursuant to the proposed Termination Agreement, if Shipflex did not leave the Property by February 28, 2023, Pilot could (1) shut off the power; (2) liquidate all assets remaining on the Property; and (3) charge a 200% holdover rate.  Shipflex refused to sign.

            Shipflex seeks (1) at least $200,000 in compensatory damages for Pilot’s breach of the Agreement, (2) injunctive relief to prevent further constructive eviction, (3) punitive damages, (4) a temporary restraining order (“TRO”), preliminary injunction, and permanent injunction enjoining Pilot from interfering with Shipflex’s quiet enjoyment of the Property, and (5) costs of suit.

           

            2. Course of Proceedings

            On December 22, 2022, Department 1 (Hon. Michelle Williams Court) granted Shipflex’s ex parte application for a TRO and order to show cause re: preliminary injunction (“OSC”) enjoining Defendants from any self-help eviction efforts.  The court set the OSC hearing for January 12, 2023 and ordered proof of service to be filed by January 3, 2023.

            That same day, Shipflex served Defendants by email with the Complaint, Summons, and notice and moving papers for the ex parte application for a TRO and OSC re: preliminary injunction.

            On December 23, 2022, Shipflex served Calvin and Pilot with the Complaint, Summons, and moving papers by substitute service, effective January 2, 2023.

            On December 29, 2022, Shipflex served Calvin the Complaint, Summons, and moving papers by substitute service, effective January 8, 2023.

                       

            B. Applicable Law

            An injunction is a writ or order requiring a person to refrain from a particular act; it may be granted by the court in which the action is brought, or by a judge thereof; and when granted by a judge, it may be enforced as an order of the court.  CCP §525.  An injunction may be more completely defined as a writ or order commanding a person either to perform or to refrain from performing a particular act.  See Comfort v. Comfort, (1941) 17 Cal.2d 736, 741. McDowell v. Watson, (1997) 59 Cal.App.4th 1155, 1160.[2]  It is an equitable remedy available generally in the protection or to prevent the invasion of a legal right.  Meridian, Ltd. v. City and County of San Francisco, et al., (1939) 13 Cal.2d 424.

            The purpose of a preliminary injunction is to preserve the status quo pending final resolution upon a trial.  See Scaringe v. J.C.C. Enterprises, Inc., (1988) 205 Cal.App.3d 1536. Grothe v. Cortlandt Corp., (1992) 11 Cal.App.4th 1313, 1316; Major v. Miraverde Homeowners Assn., (1992) 7 Cal.App.4th 618, 623.  The status quo has been defined to mean the last actual peaceable, uncontested status which preceded the pending controversy.  Voorhies v. Greene (1983) 139 Cal.App.3d 989, 995, quoting United Railroads v. Superior Court, (1916) 172 Cal. 80, 87. 14859 Moorpark Homeowner’s Assn. v. VRT Corp., (1998) 63 Cal.App.4th 1396. 1402.

            A preliminary injunction is issued after hearing on a noticed motion.  The complaint normally must plead injunctive relief.  CCP §526(a)(1)-(2).[3]  Preliminary injunctive relief requires the use of competent evidence to create a sufficient factual showing on the grounds for relief.  See e.g. Ancora-Citronelle Corp. v. Green, (1974) 41 Cal.App.3d 146, 150.  Injunctive relief may be granted based on a verified complaint only if it contains sufficient evidentiary, not ultimate, facts.  See CCP §527(a).  For this reason, a pleading alone rarely suffices.  Weil & Brown, California Procedure Before Trial, 9:579, 9(ll)-21 (The Rutter Group 2007).  The burden of proof is on the plaintiff as moving party.  O’Connell v. Superior Court, (2006) 141 Cal.App.4th 1452, 1481.

            A plaintiff seeking injunctive relief must show the absence of an adequate damages remedy at law.  CCP §526(4); Thayer Plymouth Center, Inc. v. Chrysler Motors, (1967) 255 Cal.App.2d 300, 307; Department of Fish & Game v. Anderson-Cottonwood Irrigation Dist., (1992) 8 Cal.App.4th 1554, 1565.  The concept of “inadequacy of the legal remedy” or “inadequacy of damages” dates from the time of the early courts of chancery, the idea being that an injunction is an unusual or extraordinary equitable remedy which will not be granted if the remedy at law (usually damages) will adequately compensate the injured plaintiff.  Department of Fish & Game v. Anderson-Cottonwood Irrigation Dist., (1992) 8 Cal.App.4th 1554, 1565.

            In determining whether to issue a preliminary injunction, the trial court considers two factors: (1) the reasonable probability that the plaintiff will prevail on the merits at trial (CCP §526(a)(1)), and (2) a balancing of the “irreparable harm” that the plaintiff is likely to sustain if the injunction is denied as compared to the harm that the defendant is likely to suffer if the court grants a preliminary injunction.  CCP §526(a)(2); 14859 Moorpark Homeowner’s Assn. v. VRT Corp., (1998) 63 Cal.App.4th 1396. 1402; Pillsbury, Madison & Sutro v. Schectman, (1997) 55 Cal.App.4th 1279, 1283; Davenport v. Blue Cross of California, (1997) 52 Cal.App.4th 435, 446; Abrams v. St. Johns Hospital, (1994) 25 Cal.App.4th 628, 636.  Thus, a preliminary injunction may not issue without some showing of potential entitlement to such relief.  Doe v. Wilson, (1997) 57 Cal.App.4th 296, 304.  The decision to grant a preliminary injunction generally lies within the sound discretion of the trial court and will not be disturbed on appeal absent an abuse of discretion.  Thornton v. Carlson, (1992) 4 Cal.App.4th 1249, 1255.

            A preliminary injunction ordinarily cannot take effect unless and until the plaintiff provides an undertaking for damages which the enjoined defendant may sustain by reason of the injunction if the court finally decides that the plaintiff was not entitled to the injunction.  See CCP §529(a); City of South San Francisco v. Cypress Lawn Cemetery Assn., (1992) 11 Cal.App.4th 916, 920.

 

            C. Statement of Facts

            1. Shipflex’s Evidence

            On March 7, 2022, Shipflex and Pilot entered into the 60-month Agreement for the 100,000 square-foot Property.  Wang Decl., ¶7; App. Ex. A.  The Agreement explains that Shipflex will perform third-party logistics services on the Property consisting of warehousing and distribution.  Ex. A, Schedule 1.1.  Shipflex is accorded a specific area in the warehouse in which it will warehouse furniture, office supplies, pet, consumer electronics, and home décor.  Ex. A, Schedules 1.2, 1.4.  Shipflex shall pay rent for this space is $1.40 per square foot beginning May 1, 2022, with Pilot to cover all taxes and utilities during the lease.  Ex. A, Schedule 2.1.  Shipflex must also to pay a security deposit equal to triple the monthly rent.  Ex. A, Schedule 2.1.

            Shipflex performed all obligations under the Agreement.  Wang Decl., ¶8.  Shipflex believes that Pilot has received offers of higher rent payments for Shipflex’s space.  Wang Decl., ¶9. 

            Beginning in May 2022, Pilot has engaged in increasing harassment as a form of self-help to induce Shipflex to end the Agreement.  Wang Decl., ¶9.  Pilot has (1) blocked access to the Property with automobiles, trailers, and pallets, (2) billed for utilities Pilot is liable for under the Agreement and threatened to stop cleaning restrooms and lock doors if Shipflex does not pay, and (3) assigned 30 truck parking spaces to unrelated third parties that are designated for Shipflex.  Wang Decl., ¶10. 

Pilot did not follow the mandatory notices and procedures in use for unlawful detainer litigation per CCP section 1171.  Wang Decl., ¶9.  On November 18, 2022, Pilot locked Shipflex out of the Property.  Wang Decl., ¶10.  On December 5, 2022 and thereafter Pilot cut the electricity.  Wang Decl., ¶10.

            Pilot demanded that Shipflex sign the Termination Agreement before it would restore electricity.  Wang Decl., ¶11, Ex. B.  Pursuant to that document, Shipflex must (1) leave the Property by February 28, 2023, (2) pay the rent for December 2022 and January 2023, (3) surrender the deposit to pay for damages Shipflex caused, with the remaining balance to be refunded after, and (4) waive all right to sue Pilot.  Ex. B.  If Shipflex did not vacate the Property on time, Pilot could (1) shut off the power, (2) liquidate all remaining assets on the Property, and (3) charge a 200% holdover rate.  Ex. B.

            Pilot did not negotiate the Termination Agreement with Shipflex before it presented the document for Shipflex to sign.  Wang Decl., ¶11.  Pilot texted that one of its employees would email the contract.  Wang Decl., ¶12, Ex. C.  If all was well, Shipflex could sign it to get the electricity immediately restored.  Wang Decl., ¶12, Ex. C.  Shipflex has not signed the Termination Agreement.  Wang Decl., ¶14, Ex. B.  The electricity and heat are still cut off, and the business relations have suffered as a result.  Wang Decl., ¶15.  Shipflex has not received any notice of unlawful detainer.  Wang Decl., ¶14.

 

            2. Pilot’s Evidence

            On January 24, 2022, Shipflex negotiated the Agreement with Pilot’s Chief Financial Officer (“CFO”).  Opp. Ex. A.  Shipflex’s Chief Executive Officer (“CEO”) informed Pilot’s CFO that its attorney would draft the Agreement and send it to Pilot for review.  Opp. Ex. A.  The draft became the Agreement.  Opp. Ex. B. 

 

            a. Insurance

            Section 7.2 of the Agreement requires Shipflex to secure general liability and workers’ compensation insurance.  Opp. Ex. B.

            On June 15, 2022, Pilot Office Manager Martha Gonzalez (“Gonzalez”) asked Shipflex to provide the certificate of general liability insurance, but it never responded.  Gonzalez Decl., ¶2; Opp. Ex. C.  On June 29, 2022, Gonzalez repeated the request and asked for the certificate of workers’ compensation insurance.  Gonzalez Decl., ¶3; Opp. Ex. C.  Felix Wu (“Wu”) of Shipflex emailed a copy of a certificate of insurance for general liability insurance and promised to send the certificate of workers’ compensation insurance soon.  Gonzalez Decl., ¶4; Opp. Ex. C. 

Gonzalez noted that the certificate of insurance was incorrect and requested that Wu correct it.  Gonzalez Decl., ¶5; Opp. Ex. C.  Gonzalez followed up on her request for both certificates of insurance on July 15, July 19, and August 2, 2022.  Gonzalez Decl., ¶¶ 6-8; Opp. Ex. C. 

            On August 2, 2022, Shipflex emailed a certificate of insurance for worker’s compensation insurance for Zenith Technologies (“Zenith”).  Gonzalez Decl., ¶9; Opp. Ex. C.  Gonzalez requested that Shipflex change the certificate because Zenith’s name is not on the lease.  Gonzalez Decl., ¶10; Opp. Ex. C.  Shipflex explained that Zenith is the parent company that paid all employees.  Opp. Ex. C. 

            As of January 5, 2023, Shipflex has not provided the corrected certificate of insurance for either type of required insurance.  Gonzalez Decl., ¶11.  On October 10, 2022, Gonzalez emailed Shipflex a notice that this failure constituted a default under the Agreement and Shipflex should vacate the premises by the end of 2022.  Gonzalez Decl., ¶25.

 

            b. Fire Code

            Section 4.1(b) of the Agreement requires Shipflex to comply with all applicable federal, state and local laws, rules, regulations, statutes, ordinances, codes and regulatory policies in effect, and any applicable judicial or administrative interpretation thereof.  Opp. Ex. B.

            On September 23, 2022, the Los Angeles Fire Department’s (“LAFD”) official inspection report claimed that Dreamway Express (“Dreamway”) violated several regulations on the Property.  Gonzalez Decl., ¶12; Opp. Ex. E.  LAFD issued five code violations against Shipflex between September and November 2022.  Gonzalez Decl., ¶¶ 13-17; Opp. Ex. E. 

 

            c. Property Damage and Other Breaches

            On May 27, 2022, Gonzalez emailed Wu about damage to the warehouse or Property.  Gonzalez Decl., ¶19.  Gonzalez also emailed Shipflex about (1) damages to rolling doors on July 19, 2022, (2) damages to a door on September 21, 2022, and (3) damages to the east dock fence caused by one of Shipflex’s drivers on September 26, 2022.  Gonzalez Decl., ¶¶ 20-22; Opp. Ex. D.  Shipflex also removed and added construction improvements without notice to Pilot or permission from the city.  Gonzalez Decl., ¶27.

            Shipflex has entered other warehouse space on the Property, including Pilot’s, without permission or informing the owner who just entered.  Escanuela Decl., ¶2.  Customers also complained that they cannot pick up an order because Shipflex’s trucks are blocking the door.  Escanuela Decl., ¶2; Opp. Ex. D.  Shipflex has backed its trucks into doors and walls, breaking them multiple times.  Escanuela Decl., ¶2; Yanez Decl., ¶4.

            Shipflex parks its trucks near propane tanks in the red areas marked “DO NOT PARK HERE.”  Yanez Decl., ¶2; Opp. Ex. D.  Shipflex performs maintenance on its trucks in those areas.  Yanez Decl., ¶2.  Requests for Shipflex to move the trucks have failed.  Yanez Decl., ¶3.  Shipflex sometimes claims it does not even know who owns the trucks.  Yanez Decl., ¶4. 

            Shipflex also has left a great deal of trash in the parking lot.  Escanuela Decl., ¶2; Yanez Decl., ¶5; Opp. Ex. D. 

 

            3. Reply Evidence

            Pilot continues to deny Shipflex parking spaces under the Agreement.  Reply Wang Decl., ¶3.  Due to the fact that Pilot never provided the required 30 parking spaces, Shipflex has not had enough spaces.  Reply Wang Decl., ¶4.  As a result, Shipflex has had to constantly move its cars and trucks around the yard.  Reply Wang Decl., ¶4.  Whenever Gonzalez asked Shipflex to move its trucks, Shipflex reacted immediately.  Reply Wang Decl., ¶4.

            Shipflex’s personnel sometimes enter Pilot’s warehouse because, under the Agreement Pilot allows Shipflex to use Pilot’s office, kitchen, and restroom.  Reply Wang Decl., ¶4.

            Shipflex is covered by a commercial insurance policy that complies with the Agreement and was provided to Piolot in October 2022.  Reply Wang Decl., ¶9.  Shipflex does not carry worker’s compensation insurance because it has no employees.  Reply Wang Decl., ¶10.  Shipflex’s business is carried out by employees of its parent, Zenith Technology, Inc., which does have worker’s compensation insurance.  Reply Wang Decl., ¶10.

Since LAFD’s first visit, Shipflex has worked closely with the inspector to obtain the necessary permit.  Reply Wang Decl., ¶11.  Every time Shipflex has caused accidental damage to the Property, it has paid the repair cost immediately.  Reply Wang Decl., ¶412

           

            D. Analysis

            Plaintiff Shipflex seeks a preliminary injunction enjoining Defendants Pilot and Calvin from efforts to evict Shipflex from the Property not authorized under CCP section 1171 et. seq.  App. at 2.

 

            1. Probability of Success

            The Complaint alleges claims for (1) breach of lease, (2) breach of the covenant of quiet enjoyment, (3) intentional interference with prospective economic enjoyment, and (4) violation of section 17200. 

            Shipflex presents evidence that Pilot has engaged in self-help eviction methods.  Shipflex asserts that Pilot’s self-help actions are prohibited by CCP section 1161 and case law.  Kassan v. Stout, (1973) 9 Cal.3d 39, 43.  App. at 6.  The Agreement explains that Shipflex operates a warehousing business on the Property.  Wang Decl., ¶7; App. Ex. A.  Pilot’s efforts to evict Shipflex through self-help or otherwise harm its business without complying with unlawful detainer law would violate section 17200 and breach the covenant of quiet enjoyment in the Agreement.

  A person is guilty of a forcible entry who “after entering peaceably upon real property, turns out by force, threats, or menacing conduct, the party in possession.”  CCP §1159(a)(2).  The “party in possession” refers to any person who “hires real property,” including tenants, lessees, boarders, and lodgers.  CCP §1159(b); Spinks v. Equity Residential Briarwood Apartments, (“Spinks”) (2009) 171 Cal.App.4th 1004, 1037.

A person is guilty of a forcible detainer who “[b]y force, or by menaces and threats of violence, unlawfully holds and keeps the possession of any real property, whether the same was acquired peaceably or otherwise.”  CCP §1160(a)(1).  This statute protects the “occupant of real property,” meaning one “in the peaceable and undisturbed possession of such lands.”  CCP §1160; Spinks, supra, 171 Cal.App.4th at 1038.

CCP sections 1159 and 1160 “reflect a policy, with deep roots in English law, barring the use of forceful self-help to enforce a right to possession of real property and requiring instead the use of judicial process to gain possession.”  Glass v. Najafi, (2000) 78 Cal.App.4th 45, 49.

Pilot admits that it turned the electricity off to at least part of the warehouse on the Property.  Opp. at 3.[4]  Pilot will not turn the electricity back on until Shipflex signs the Termination Agreement requiring it to vacate the premises by February 2023 or pay a 200% holdover fee.  Wang Decl., ¶¶ 11-12, App. Exs. B-C.  Pilot employee Gonzalez admits that she told Shipflex that it must vacate the premises by the end of 2022.  Gonzalez Decl., ¶25.

            Pilot asserts that the Agreement is a license agreement that permits Shipflex to perform a acts on the Property and conveys no estate in land.  Eastman v. Piper, (1924) 68 Cal.App. 554.   As a result, Pilot suggests that the Agreement is not a lease.  Opp. at 3. 

Agreements for use of space where others are also permitted to use the space for ingress and egress are mere licenses.  San Jose Parking, Inc. v. Superior Court, (“San Jose Parking”) (2003) 110 Cal.App.4th 1321, 1328; Qualls v. Lake Berryessa Enterprises, Inc., (“Qualls”) (1999) 76 Cal.App.4th 1277, 1285.  Whether a contract confers a mere license or instead creates a tenancy is a question of law.  Spinks, supra, 171 Cal.App.4th at 1040.  Courts look to the contract to determine the parties’ expressed intent.  Qualls, supra, 76 Cal.App.4th at 1283.

The fundamental goal of contractual interpretation is to give effect to the mutual intention of the parties.  Bank of the West v. Superior Court, (1992) 2 Cal.4th 1254, 1264.  This mutual intention is determined by objective manifestations of the parties’ intent, including the words used in the agreement, as well as extrinsic evidence of such objective matters as the surrounding circumstances under which the parties negotiated or entered into the contract, the object, nature and subject matter of the contract, and the subsequent conduct of the parties.  Civil Code §§1635-56; Morey v. Vannucci, (1998) 64 Cal.App.4th 904.  The parties’ intent should be ascertained from the contract alone, if possible.  Civil Code §1639.  The interpretation should give effect to every part of the contract, if reasonably practicable.  Civil Code §1640.  The words of a contract are to be interpreted in their ordinary sense (Civ. Code §1644), and technical words are to be interpreted as usually understood by persons in the business to which they relate.  Civil Code §1645.  Words inconsistent with the main intention of the parties are to be rejected.  Civil Code §1653.  Any uncertainty in a contract is to be construed most strongly against the party responsible for it.  Civil Code §1654.[5]

The parties present different versions of the Agreement, and Shipflex’s version contains language reflecting that it is a lease.  App. at Ex. A; Opp. at Ex. B.  Assuming arguendo that Pilot’s version is the actual Agreement, it provides for Shipflex to provide warehouse services on the Property.  However, Shipflex is not simply accorded a right of ingress and egress to the warehouse but rather is given a unique space.  Ex B, Schedule 1.2.  The Agreement also provides that if there is any additional space available to rent, Shipflex has priority to lease the space from Pilot “with the same terms and conditions as this original lease agreement.” Ex. B, Schedule 2.1.  For this space, Shipflex must pay rent of $1.40 per square foot plus a security deposit. Ex. B, Schedule 2.1.  Pilot employee Gonzalez also called the Agreement a lease when she said that the insurance certificates needed to be in Shipflex’s name because Shipflex’s name was on the lease.  Gonzalez Decl., ¶10; Opp. Ex. C.  The Agreement is a lease.

            Given that Shipflex leases warehouse space under the Agreement, the rest of Pilot’s arguments have no merit.  Pilot presents evidence that Shipflex has breached the Agreement by violating fire code regulations and failed to correct them (Gonzalez Decl., ¶¶ 13-17; Opp. Exs. B, E), failing to provide certificates of insurance for general liability and worker’s compensation insurance in its own name (Gonzalez Decl., ¶¶ 3-11; Opp. Exs. B, C), entering other warehouses on the Property without permission (Escanuela Decl., ¶2), blocking doors and walls on the Property (Escanuela Decl., ¶2; Opp. Ex. D; Yanez Decl., ¶¶ 3-4), leaving mountains of cardboard in the parking lot (Yanez Decl., ¶5; Opp. Ex. D), damaging the Property (Gonzalez Decl., ¶¶ 20-22; Opp. Ex. D), and removing and adding construction improvements without notice to Pilot or permission from the city (Gonzalez Decl., ¶27).  These breaches do not give Pilot the right to evict Shipflex except through the unlawful detainer process.

            Shipflex has demonstrated a probability of success on its section 17200 and breach of the covenant of quiet enjoyment claims based on tenant protections against self-help evictions.

 

            2. Balance of Hardships

            In determining whether to issue a preliminary injunction, the second factor which a trial court examines is the interim harm that plaintiff is likely to sustain if the injunction is denied as compared to the harm that the defendant is likely to suffer if the court grants a preliminary injunction.  Donahue Schriber Realty Group, Inc. v. Nu Creation Outreach, (2014) 232 Cal.App.4th 1171, 1177.  This factor involves consideration of the inadequacy of other remedies, the degree of irreparable harm, and the necessity of preserving the status quo.  Id.

            Shipflex alleges, and Pilot does not deny, that the loss of electricity and supposed lockdown of the Property has harmed important business relations.  Wang Decl., ¶15.  Were Pilot to engage in self-help eviction efforts again, it could prevent Shipflex operations and impact its revenue and its viability as a company.  App. at 5.

            Pilot argues that a preliminary injunction will harm the other companies that use the warehouse and the general public.  Opp. at 6-8.  Pilot ignores the fact that it can file an unlawful detainer action against Shipflex to protect itself and its customers.  Pilot can also sue Shipflex for tort damages based on the harm Shipflex has caused to the Property, and to Pilot’s reputation with its customers.  A preliminary injunction will only prohibit self-help eviction efforts which Pilot admits it should not do.  Opp. at 5.

            The balance of hardships favors a preliminary injunction.

 

            E. Conclusion

            The application for a preliminary injunction is granted.  Shipflex has not provided a proposed preliminary injunction and must do so within two court days or it will be waived.

The court must require a bond supporting the preliminary injunction.¿ The purpose of a bond is to cover the defendant’s damages from an improvidently issued injunction.¿ CCP §529(a).¿ In setting the bond, the court must assume that the preliminary injunction was wrongly issued.¿ Abba Rubber Co. v. Seaquist, (1991) 235 Cal.App.3d 1, 15.¿ The damages include any lost profits resulting from the injunction.  See Allen v. Pitchess, (1973) 36 Cal.App.3d 321, 327-28.  The attorney’s fees necessary to successfully procure a final decision dissolving the injunction also are damages that should be included in setting the bond.  Abba, supra, 235 Cal.App.3d at 15-16.  While Abba reasoned that the plaintiff’s likelihood of prevailing is irrelevant to setting the bond, a more recent case disagreed, stating that the greater the likelihood of the plaintiff prevailing, the less likely the preliminary injunction will have been wrongly issued, and that is a relevant factor for setting the bond.  Oiye v. Fox, (2012) 211 Cal.App.4th 1036, 1062.  In lieu of a bond, the judge may permit a deposit into court.  CCP §995.710.

            Neither party discusses the bond to be issued.  As discussed above, the only actions to be enjoined are those constituting self-help eviction efforts.  The bond to prevent this unlawful action should be modest.  The court will discuss the amount of the bond with counsel at hearing.



[1] Defendant Pilot failed to lodge a courtesy copy of its opposition and supporting declarations in violation of the Presiding Judge’s First Amended General Order for Electronic Filing.  Pilot’s counsel is admonished to lodge courtesy copies of all filings in this lawsuit.

            [2] The courts look to the substance of an injunction to determine whether it is prohibitory or mandatory.  Agricultural Labor Relations Bd. v. Superior Court, (1983) 149 Cal.App.3d 709, 713.  A mandatory injunction — one that mandates a party to affirmatively act, carries a heavy burden: “[t]he granting of a mandatory injunction pending trial is not permitted except in extreme cases where the right thereto is clearly established.”  Teachers Ins. & Annuity Assoc. v. Furlotti, (1999) 70 Cal.App.4th 187, 1493.

            [3] However, a court may issue an injunction to maintain the status quo without a cause of action in the complaint.  CCP §526(a)(3).

[4] Pilot’s opposition is unpaginated in violation of CRC 2.109.  Pilot’s counsel is ordered to paginate all further filings in this lawsuit.

[5] Where the meaning of words used in a contract is disputed, the court must provisionally receive any proffered extrinsic evidence which is relevant to show whether the contract is reasonably susceptible of a particular meaning.  Pacific Gas & Electric Co. v. G.W. Thomas Drayage, (1968) 69 Cal.2d 33, 39-40.  Even if a contract appears unambiguous on its face, a latent ambiguity may be exposed by extrinsic evidence which reveals more than one possible meaning to which the language of the contract is susceptible.  Id. at 40, n.8.  Extrinsic evidence is thus admissible to interpret the contract, as long as such evidence is not used to give the contract a meaning to which it is not reasonably susceptible. Morey v. Vannucci, (1998) 64 Cal.App.4th 904. 

Neither side offers extrinsic evidence of the Agreement’s negotiation or performance that would bear on interpretation.