Judge Jill Feeney, Case Number: 23STCV20167, Date: 2023-10-23 Tentative Ruling

Plaintiff Blvd Foods, LLC (“Plaintiff”) owns real property located at 520 W Whittier Blvd, Unit A, Montebello, CA 90640 (the “Subject Property”). On May 1, 2021, Defendant The Chicken Koop LLC entered into a monthly lease with Plaintiff to occupy the Subject Property. Defendant has since defaulted on its rent payments.

A party may move for summary judgment “if it is contended that the action has no merit or that there is no defense to the action or proceeding.” (Code Civ. Proc. § 437c, subd. (a).) “[I]f all the evidence submitted, and all inferences reasonably deducible from the evidence and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law,” the moving party will be entitled to summary judgment. (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.) A motion for summary adjudication may be made by itself or as an alternative to a motion for summary judgment and shall proceed in all procedural respects as a motion for summary judgment. (Code Civ. Proc. § 437c, subd. (f)(2).)

The moving party bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact, and if he does so, the burden shifts to the opposing party to make a prima facie showing of the existence of a triable issue of material fact. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850; Code Civ. Proc. § 437c, subd. (p)(2).) On a plaintiff’s motion, the plaintiff must present evidence that would require a reasonable trier of fact to find any underlying material fact more likely than not. (Id at p.845.) The plaintiff meets his burden of showing that there is no defense to a cause of action if he has proved each element on that cause of action. (Id at p.849.) The burden then shifts to the defendant to show that a triable issue of one or more material facts exists as to that cause of action or defense. (Id.)

“When deciding whether to grant summary judgment, the court must consider all of the evidence set forth in the papers (except evidence to which the court has sustained an objection), as well as all reasonable inferences that may be drawn from that evidence, in the light most favorable to the party opposing summary judgment.” (Avivi v. Centro Medico Urgente Med. Ctr. (2008) 159 Cal.App.4th 463, 467; see also Code Civ. Proc., § 437c(c).)

In an unlawful detainer action, notice of a motion for summary judgment must be given in compliance with Code of Civil Procedure sections 1013 and 1170.7. (Cal. Rules of Court, Rule 3.1351(a).) Code Civ. Proc., §¿1170.7 provides that a motion for summary judgment may be made at any time after the answer is filed upon giving five days’ notice. Summary judgment shall be granted or denied on the same basis as a motion under Section 437c. (Code Civ. Proc., §¿1170.7.) A separate statement need not be filed in support of or in opposition to a motions for summary judgment in an unlawful detainer action. (Code Civ. Proc., §437 subd. c(b),(s).)

Any opposition to the motion and any reply to an opposition may be made orally at the time of hearing. (Cal. Rules of Court, Rule 3.1351(b).) If a party seeks to have a written opposition considered in advance of the hearing, the written opposition must be filed and served on or before the court day before the hearing. (Cal. Rules of Court, Rule 3.1351(c).) Service must be by personal delivery, facsimile transmission, express mail, or other means consistent with Code Civ. Proc., §§¿1010-1013, and reasonably calculated to ensure delivery to the other party or parties no later than the close of business on the court day before the hearing. (Id.) The court, in its discretion, may consider written opposition filed later. (Id.)

“The basic elements of unlawful detainer for nonpayment of rent contained in Code of Civil Procedure section 1161, subdivision (2), are (1) the tenant is in possession of the premises; (2) that possession is without permission; (3) the tenant is in default for nonpayment of rent; (4) the tenant has been properly served with a written three-day notice; and (5) the default continues after the three-day notice period has elapsed.” (Kruger v. Reyes (2014) 232 Cal.App.4th Supp. 10, 16 (internal citations omitted).) “The failure of the tenant to pay rent does not ipso facto work a forfeiture of the leasehold; it merely gives the lessor the right to terminate the lease in the manner provided by law...[.]’ The essential element, therefore, is the notice and whether or not it comports with the fundamental requirements of the law.” (Id.)

“The amount of back-due rent is generally limited to that demanded in the three-day notice. A landlord proceeding by way of a three-day notice for nonpayment of rent may also recover damages for rental losses occurring after the period covered by the three-day notice expires.” (Hong Sang Market, Inc. v. Peng (2018) 20 Cal.App.5th 474, 491–492 (internal citations omitted).) Service of this notice on commercial tenants may be made by personal delivery, by substituted service on a person of suitable age and discretion at the tenant’s property followed by mailing of the notice addressed to the tenant, or by affixing a copy of the notice on the property followed by mailing of the notice addressed to the tenant. (Code Civ. Proc., § 1162(b).)

Here, Plaintiff provides the declaration of Joel Rodstein, CEO and Managing Agent for Plaintiff. Rodstein testifies that Plaintiff owns the subject property. (Rodstein Decl., ¶2.) Rodstein maintains Plaintiff’s books and records, and testifies that the parties entered into a rental agreement for the subject property. (Id., ¶5.) Defendant was to pay a monthly rent of $2,900 on the 1st of each month. (Id.) On May 1, 2023, Plaintiff increased rent to $3,076.61. (Id., ¶6.) In addition to rent, Defendant was responsible for common area operating expenses that changed each month. (Id., ¶7.) On July 31, 2023, Rodstein served a 10-Day Notice to Pay Rent or Quit for $50,301.69 on Defendant for unpaid rent and common area operating charges going back seven months. (Id., ¶8.) Defendant has not tendered any payment between the service of the notice and September 26, 2023, the date of the declaration. (Id., ¶12.) Defendant continues to occupy the subject property. (Id., ¶13.) The daily fair rental value of the property is $102.55 ($3,076.61/30). (Id., ¶14.)

Plaintiff also provides a copy of the lease (Exhibit A), copies of the notice (Exhibit B), proof of service of the notice (Exhibit C), and a ledger showing Defendant owed $69,839.46 as of July 1, 2023, the last entry before the 10-day notice was served on July 31, 2023. (Exhibit D). The parties’ lease required Plaintiff to provide a 10-day notice in the event of default. (Exhibit B, pdf p.17.)

Plaintiff’s evidence shows that Defendant is in possession of the premises. Additionally, Defendant defaulted on rent beginning in February 2023. Because Defendant defaulted on its obligation to pay rent, Defendant’s continued possession is without Plaintiff’s permission. Plaintiff properly served a 10-day notice to quit as required under the lease by affixing a copy of the notice at the subject property and thereafter mailing a copy to Defendant. After the notice period expired, Defendant failed to pay rent or quit the premises.

Plaintiff meets its burden of showing no triable issues of material fact remain as to each element of its unlawful detainer cause of action. The Court notes that Plaintiff’s recovery is limited to the $50,301.69 demanded in the 10-day notice and rental losses beginning after the expiration of the notice period until entry of judgment at a rate of $102.55 per day.

First, Defendant argues that the notice was not served to the address agreed upon in the lease. Specifically, Articles 1.13 and 33.24 of the lease provide that the parties agreed to serve notices addressed as specified in article 1.12.

In commercial leases, the landlord and commercial tenant may lawfully agree to notice procedures that differ from those provided in the statutory provisions governing unlawful detainer. (Culver Center Partners East #1, L.P. v. Baja Fresh Westlake Village, Inc. (2010) 185 Cal.App.4th 744, 750.) If a lease contains service requirements for the notice to quit at variance with the requirements in the unlawful detainer statutes, the lease provisions control. (Id.)

Here, Article 23 states “In addition to the defaults described in Article 22 hereinabove and in Article 27 hereafter, the occurrence of any one or more of the following events shall constitute a default and breach of this Lease by Tenant: (a) the failure to pay any rental or other payment required hereunder to or on behalf of Landlord where such default shall continue for a period of ten (10) days after written notice thereof from Landlord to Tenant, which notice shall be deemed to be the statutory notice so long as such notice complies with statutory requirements”

Article 33.24 states “Wherever in this Lease it shall be required or permitted that notice and demand be given or served by either party to this Lease to or on the other, such notice or demand shall be given or served in writing and shall not be deemed to have been duly given or served unless in writing, and personally served or forwarded by overnight mail such as Federal Express or certified mail, postage prepaid, addressed as specified in Article 1.12. Either party may change the address set forth in Section 1.12 by written notice by certified mail to the other. Any notice or demand given by certified mail shall be effective one (1) day subsequent to mailing. All options to extend, if any, shall be delivered by certified mail only and shall be effective only if delivered by certified mail.”

Article 1.12 pertains to the tenant’s share of additional rent expenses. Thus, the reference to Article 1.12 in Article 33.24 appears to be a typographical error. Article 1.13 provides that Defendant’s address for notices is The Chicken Koop, LLC 7028 Greenleaf Ave #N Whittier, CA 90602.

Defendant argues that Plaintiff failed to serve the notice to quit according to the lease because it was not served at the correct address. Article 33.24 states that whenever in the lease it shall be required or permitted that notice be served the address in 1.12 should be used. Although the Article references Article 1.12, it is clear this was a typographical error because the address for notice is in Article 1.13.

Plaintiff’s initial motion did not address the issue of where notice should be sent pursuant to the terms of the lease. Plaintiff’s reply does not address this issue either. Plaintiff maintains that the notice was also served via certified mail as set forth in the lease. However, all the proofs of service indicate that the notices were sent to the property address, 520 Whittier Blvd., Unit A, Montebello, CA 90640, not the corporate address provided in the lease.

Here, there appears to be some ambiguity in the contract given that Article 23 seems to require Plaintiff to provide notice that complies with the statutory requirements of Code of Civil Procedure Section 1162 and given that sending notice to corporate headquarters would not meet the requirements of that code section. Given this ambiguity, summary judgment cannot be granted.

Second, Defendant alleges that it did not receive a copy of the notice and did not find a copy of the notice posted at the subject property. Defendant’s Chief Executive Officer, Mischelle Leblanc, testifies that she and her employees did not receive the notice to quit in the mail and did not find a copy of the notice posted in a conspicuous place in the restaurant. (Leblanc Decl., ¶¶9-11.)

Pursuant to Evidence Code Section 647 there is a statutory presumption of the facts set forth in the proof of service filled out by a registered process server. This provision applies in unlawful detainer cases. (Palm Property Investments, LLC v. Yadegar (2011) 194 Cal.App.4th 1419, 1428.) Once that evidentiary presumption is met, the other side bears the burden of providing evidence that they were not properly served. (Id. at 1428.)

Here, Plaintiffs provide two proof of service signed under penalty of perjury by a registered California process server indicating that the notice was posted on the property and mailed to the property on July 31, 2023.

To rebut this presumption, Defendant offers the declarations of Leblanc. For purposes of summary judgment, Leblanc has established sufficient knowledge that had employees at the restaurant received the mailed notice or seen the posted notice, they would have let her know in the ordinary course of business and that they did not do so. This is sufficient to show a dispute of material fact finding all inferences in favor of Defendant as the Court must do at the summary judgment stage.