Judge John J. Kralik, Case Number: 24NNCV01111, Date: 2025-02-05 Tentative Ruling

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Superior Court of California

County of Los Angeles

Department B

Plaintiff Incentax, LLC (“Plaintiff”) filed this action against defendants MGS Ventures, Inc. (“MGS”), Monika Wojcik (“Wojcik”), and Greg Sierota (“Sierota”) (together “Defendants”) on April 22, 2024 for (1) breach of written contract, (2) breach of the implied covenant of good faitha and fair dealing, (3) goods and services rendered, (4) account stated, (5) open book account, and (6) quantum meruit.

As alleged in the complaint and confessed upon Defendants’ default: Plaintiff provided tax consulting services to Defendants beginning June 7, 2022, pursuant to a written contract attached to the complaint as Exhibit A (“the Agreement”). The Agreement is between Plaintiff and “CLIENT”, defined to include MGS and “its members, partners, and other interested stakeholders”. (Compl., Exh. A, p. 1.) Wojcik signed the Agreement in her capacity as MGS’ CEO, beneath a signature line labeled “CLIENT”. (Id., at p. 5.)

As of filing the complaint, Defendants had failed to pay Plaintiff $59,368.80, inclusive of late fees.

Plaintiff personally served all defendants on May 2 and 4, 2024. The clerk entered their defaults on June 13, 2024. Plaintiff dismissed all unnamed defendants on June 28, 2024. Plaintiff’s June 13, 2024 Request for Default contains signed declarations of mailing and non-military status. Plaintiff’s signed Request for Court Judgment contains equivalent declarations and an attestation to $888.30 in costs.

Plaintiff’s demand is less than or equal the amount demanded in the complaint, so Defendants were given proper notice of their potential liability.

As to MGS, the confessed allegations in the complaint and supplemental declarations prove its liability.

As to the individual defendants, the Court ordered supplemental briefing to establish their liability through MGS based on an alter ego theory.

Plaintiff alleges all three defendants are liable on the Agreement because MGS serves as alter ego for its co-defendants. As alleged in the complaint, with all facts (but not conclusions) confessed upon default:

“7. Plaintiff is informed and believes and thereon alleges that WOJCIK and SIEROTA are, and at all times herein mentioned were, the alter egos of MGS and there exists, and at all times herein mentioned has existed, a unity of interest and ownership between MGS, WOJCIK and SIEROTA such that any separateness has ceased to exist.

8. Plaintiff is further informed and believes and thereon alleges that WOJCIK and SIEROTA, on the one hand, and MGS, on the other, are, and at all times herein mentioned were, alter egos and there exists, and at all times herein mentioned has existed, a unity of interest and ownership between MGS, WOJCIK and SIEROTA such that any separateness between them has ceased to exist in that WOJCIK and SIEROTA completely controlled, dominated, managed, and operated MGS to suit the convenience of WOJCIK and SIEROTA.

9. Plaintiff is informed and believes and thereon alleges that MGS is, and at all times herein mentioned was, a mere shell. instrumentality, and conduit through which WOJCIK and SIEROTA carried on their business in thc corporate name, exercising complete control and dominance of such business to such an extent that any individuality or separateness of MGS, WOJCIK and SIEROTA docs not exist and at all times herein mentioned, did not exist.

10. Plaintiff is informed and believes and thereon allcges that adherence of [sic] the fiction of the separate existence of WOJCIK and SIEROTA as distinct from MGS would permit an abuse of the corporate privilege and promote injustice, as well as sanction fraud, as the alter ego Defendants have deliberately rendered themselves financially unable to respond to money judgments.”

As to its alter ego allegations, Plaintiff also submitted supplemental briefing establishing that MGS is authorized to issue only 100 common shares, and Wojcik was the sole owner of MGS at all relevant times. (Ganczak Decl., ¶¶ 13-14.)

Plaintiff also alleges defendant Sierota is MGS’ chief executive officer, but presents no evidence to that effect. (09-16-2024 Summ. of Case, 3:17-18 [no citation to evidence].)

The Court finds this evidence satisfactory to show MGS operated as alter ego of Wojcik, but not Sierota. Service as chief executive – not proven as to Sierota – does not show alter ego by itself. But as to Wojcik, the Court finds Plaintiff has shown, through confessed allegations and evidence, that (1) Wojcik is sole owner of MGS, (2) she also acts as its executive, (3) she and her co-defendant, as alleged and confessed, have rendered themselves financially unable to satisfy debts. The Court also notes that Wojick signed the Agreement in her capacity as CEO, but purported to bind herself not only MGS but herself as it owner, according to the definition of “CLIENT”. This suggests unity of interest.

Plaintiff has established both Wojcik and MGS are liable on the Agreement. Judgment may be entered against both defendants upon dismissal of Sierota.

Plaintiff’s complaint and exhibits establish it is owed principal damages of $59,368.80.

Plaintiff’s prejudgment interest calculation is inflated. Plaintiff’s calculation is based on the total principal owed, and it calculates its interest to accrue beginning July 25, 2023. But it is not clear the entire principal was owed on that date. The principal encompasses late fees charged monthly through at least December 2023, and further interest charged on the past-due amounts through March 2, 2024. These amounts were not necessarily owed as early as July 25, 2023, and it appears some of the amounts already accrued interest as agreed in the parties’ contract; to apply pre-judgment interest would duplicate Plaintiff’s recovery.

As a result, the Court applies interest from the last date of each invoice attached to the complaint, at 10% annually, as follows:

Principal	Per diem interest	Beginning date	Total Days	Total interest
$20,992.18	$5.75	2/26/24	345	$1,983.75
$22,712.10	$6.22	3/3/24	339	$2,108.58
$15,664.52	$4.29	3/1/24	341	$1,462.89
TOTAL				$5,555.22

Plaintiff has demonstrated it is entitled to prejudgment interest totaling $5,555.22 as of the proposed date of judgment, with $16.26 accruing daily thereafter.

Plaintiff has also attested to a reasonable $888.30 in filing fees and service costs.

Attorneys’ fees are awarded according to the parties’ contract at p. 5 (“ATTORNEYS’ FEES”) based on the default schedule appearing in Los Angeles Local Court Rule 3.214. For a principal recovery of $59,368.80, the awarded totals $1,890.00 plus 2% of $9,368.80, for a total award of $2,077.37. Plaintiff demanded the same in its Request for Judgment.

Based on the current record, the Court may award judgment in Plaintiff’s favor, against MGS and Wojick only, in the total amount of $67,889.69 on February 5, 2024. Plaintiff’s current documents do not reflect this result; most importantly, they are based on a prejudgment interest calculation dating only through June 28, 2024.

Plaintiff is ordered to submit an updated CIV-100 Request for Court Judgment and JUD-100 Proposed Judgment reflecting these terms. Service on the defaulted defendants is unnecessary.

Plaintiff is ordered to comply with the proposed order on or before February 12, 2024. The Court continues this hearing to March 6, 2025, at which it will sign a Proposed Judgment if Plaintiff has complied with the terms of this Order.