Superior Court of California 

County of Los Angeles 

Department 78 

 

HAJOCA CORPORATION,

Plaintiff,

vs. 

GOODSON REAL ESTATE, CO., et al.,

Defendants. Case No.: 23STCV30386

DEMURRER AND MOTION TO STRIKE FILED BY CROSS-DEFENDANT THE HAJOCA CORPORATION.

This matter is continued to June 11, 2024. The automatic stay only pertains to Jacob Mullen at this time. Cross-Complainants may file an opposition to Hajoca’s demurrer and motion to strike no later than May 29, 2024. Hajoca may file a reply no later than June 4, 2024.

Moving party to provide notice.

FACTUAL BACKGROUND

This motion pertains to a Cross-Complainant filed by Goodson Real Estate Co. (GRE) and HIMR Normandie JV, LLC (HIMR) against Cross-Defendants Express Remodeling & Plumbing Inc. (Express), Jacom Mullem, The North River Insurance Company (North River), Hudson Insurance Company (Hudson), and Hajoca Corporation (Hajoca). Cross-Complainants bring causes of action for breach of contract, negligence, fraud, conversion, contractors license bond, violation of Bus. & Prof. Code, section 17200, et seq., tortious interference, and an accounting. Cross-Complainants allege that in 2021, GRE entered into a subcontracting agreement with Express to do plumbing work on an property owned by HIMR in Koreatown. Jacob Mullen is the principal of Express. GRE paid Express more than $194,000 for the work. Express and Mullen failed to perform the work in a timely manner, staff the property, and supply and install lines. The work they did perform was done in a negligent manner. Express and Mullen held up construction on the property, causing Cross-Complainants to spend a significant sum to find a new subcontractor and correct the defective work. 

Hajoca furnished materials to Express and Mullen without GRE’s authorization and opened an unauthorized charge account to GRE. Although GRE demanded that the unauthorized charges be removed and charged to Express and Mullen, Hajoca issued a Preliminary Notice for $150,000 and fabricated invoices and other information to circumvent California law on Preliminary Notices.  

PROCEDURAL HISTORY 

On December 12, 2023, Plaintiff Hajoca filed its Complaint against Goodson Real Estate Co., HIMR Normandie JV, LLC, Merchants Bonding Company, and Business Alliance Insurance Company.

On January 31, 2024, Cross-Complainants filed their Cross-Complaint.

On February 1, 2024, Cross-Complainants filed a First Amended Complaint (FAC).

On March 4, 2024, Cross-Defendant Hajoca filed this demurrer and motion to strike.

On April 14, 2024, Jacob Mullen filed a notice of stay of proceedings.

On May 1, 2024, Cross-Complainants filed a non-substantive opposition.

On May 2, 2024, Hajoca filed an objection to the notice of stay of proceedings.

DISCUSSION 

Cross-Complainants argue in their opposition to Hajoca’s demurrer that the demurrer is automatically stayed because Cross-Defendant Mullen filed a notice of automatic stay. 

The filing of a bankruptcy proceeding automatically stays all state and federal proceedings outside of the bankruptcy court against the debtor and the debtor’s property. (11 U.S.C., section 362(a).) The bankruptcy of one defendant in a case with multiple defendants does not stay the case as to the remaining defendants. (In re Miller (2001) 262 BR 499, 503-504, fn. 6; Higgins v. Superior Court (2017) 15 Cal.App.5th 973, 981. 

The bankruptcy stay may be extended to non-debtor defendants where unusual circumstances exist. (Strobel v. Johnson & Johnson (2021) 70 Cal.App.5th 796, 830.) Unusual circumstances exist where the identities of the debtor and a third party defendant are such that a judgment against the third party defendant would be in effect a judgment or finding against the debtor. (Id.) 

Here, proceedings in this case are only stayed as to Jacob Mullen at this time. Hajoca’s demurrer and motion to strike Cross-Complainants’ Cross-Complaint would only affect the causes of action against Hajoca. There are no unusual circumstances in this case which would warrant extending the stay to the other parties in this case.  Therefore, the demurrer is not stayed. The notice of stay filed by Mullen on April 25, 2024 checked box 2a. in error.

Hajoca’s demurrer and motion to strike will proceed. To allow Cross-Complainants to file a substantive opposition, the motions are continued to June 11, 2024. The parties must follow the filing schedule described above.

DATED: May 14, 2024

__________________________

Hon. Jill Feeney 

Judge of the Superior Court