Judge: Jon R. Takasugi, Case: 21STCV12443, Date: 2023-04-17 Tentative Ruling

Case Number: 21STCV12443    Hearing Date: April 17, 2023    Dept: 17

Superior Court of California

County of Los Angeles

DEPARTMENT 17

TENTATIVE RULING

AWAC’s motion to bifurcate is DENIED.

On 4/1/2021, Plaintiffs Caruso Affiliated Holdings, LLC, Caruso Management Company, Ltd., Americana Housing L.P., Americana Homes, LLC, Americana Homes II, LLC, and the Americana at Brand, LLC (collectively, Plaintiffs), filed suit against Allied World Assurance Company (U.S.) Inc., (AWAC) Endurance American Specialty Insurance Company, Endurance Assurance Corporation, Arthur J. Gallagher & Co. Insurance Brokers of California (Gallagher). On 1/10/2023, Plaintiffs filed a first amended complaint (FAC) alleging: (1) declaratory relief; (2) reformation; (3) negligence; (4) negligent misrepresentation; and (5) breach of fiduciary duty.

Now, AWAC moves to bifurcate trial.

Discussion

AWAC moves the Court for an order to have a bench trial on the reformation and declaratory relief action against AWAC, separate from the trial on the remaining causes of action against Gallagher. AWAC argues that bifurcation is appropriate because reformation sounds in equity, the determination of the reformation issue will be “quick”, bifurcation will prevent AWAC from having to otherwise participate in a lengthy trial in which it has no witnesses, evidence or stake in the outcome, and will avoid jury confusion over the differing burdens of proof for the claims asserted.  

            The Court disagrees that bifurcation is appropriate here.

            Generally, “whether there shall be a severance and separate trials on issues in a single action is a matter within the discretion of the trial court.” (Shade Foods, Inc. v. Innovative Products Sales & Marketing, Inc. (2000) 78 Cal.App.4th 847, 911.) CCP section 598 provides:

The court may, when the convenience of witnesses, the ends of justice, or the economy and efficiency of handling the litigation would be promoted thereby, on motion of a party . . . that the trial of any issue or any party thereof, shall precede the trial of any other issue or any part thereof shall precede the trial of any other issue or any part thereof in the case, except for special defenses which may be trial first pursuant to Sections 597 and 597.5. The court, on its own motion, may make such an order at any time. Where the trial or trial of the issue of liability as to all causes of action precedes the trial of other issues or parts thereof, and the decision of the court, or the verdict of the jury upon such issue so tried is in favor of any party on whom liability is sought to be imposed, judgment in favor of such party shall thereupon be entered and no trial of other issues in the action as against such party shall be had unless judgment shall be reversed upon appeal or otherwise set aside or vacated.

As noted by AWAC, legal issues such as contract reformation and the accompanying declaratory relief against AWAC are matters for the Court, not the jury (Jones v. First American Title Ins. Co. (2003) 107 Cal. App. 4th 381; Martinez v. Martinez (1950) 99 Cal. App. 2d 425.) There is generally no right to a jury trial in an equitable proceeding. (Loftus v. Fischer (1896) 113 Cal. 286.) As such, Plaintiffs’ reformation claims are properly decided by the Court.

However, as pointed out in opposition, at least three witnesses—Patelson, Moraitis, and either Jackie Levy or Samantha Azulay—will be called to testify in both the reformation and declaratory relief claims against AWAC and in the jury trial’s fiduciary duty and negligence claims against Gallagher. As a result, bifurcation would actually unnecessarily require the duplication of evidence. Moreover, AWAC’s argument ignores the fact that the Court can consider the evidence simultaneously with the jury and reach a determination of the reformation and declaratory relief claims while the jury is considering the remaining non-equity claims. The Court agrees with Plaintiffs that this is the more efficient and appropriate way to proceed. 

            Based on the foregoing, AWAC’s motion for bifurcation is denied.

It is so ordered.

Dated:  April    , 2023

   Hon. Jon R. Takasugi
   Judge of the Superior Court

Parties who intend to submit on this tentative must send an email to the court at smcdept17@lacourt.org by 4 p.m. the day prior as directed by the instructions provided on the court website at www.lacourt.org.  If a party submits on the tentative, the party’s email must include the case number and must identify the party submitting on the tentative.  If all parties to a motion submit, the court will adopt this tentative as the final order.  If the department does not receive an email indicating the parties are submitting on the tentative and there are no appearances at the hearing, the motion may be placed off calendar. 

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