Judge Lee W. Tsao, Case Number: 22NWCV00639, Date: 2023-09-28 Tentative Ruling

Judge: Lee W. Tsao, Case: 22NWCV00639, Date: 2023-09-28 Tentative Ruling

Case Number: 22NWCV00639 Hearing Date: January 4, 2024 Dept: C

NATIONAL COMMERCIAL RECOVERY, INC. v. L.A. GRAND CLOTHING, INC.

CASE NO.: 22NWCV00639

HEARING: 01/04/24

Cross-Defendants HWAN KIM and PVE EK LLC’s Demurrer to the Cross-Complaint is OVERRULED.

Opposing Party to give Notice.

No Reply filed as of January 2, 2024.

Cross-Defendants Request for Judicial Notice is GRANTED as to the existence of the document, but not as to any hearsay statements contained therein. (Cal. Ev. Code §452.)

This collections action was filed by Plaintiff/Cross-Defendant NATIONAL COMMERICAL RECOVERY, INC. (“Cross-Defendant”) on July 26, 2022. On September 15, 2022, a First Amended Complaint (“FAC”) was filed.

On February 24, 2023, the subject Cross-Complaint (“XC”) was filed by Defendants/Cross-Complainants L.A. GRAND CLOTHING INC.; SSS APPAREL INC.; GUILBERT TEX, INC.; SM CLOTHING INC.; and SIAMIAK OKHOVAT, individually and as trustee of The Okhovat Revocable Family Trust, Dated May 12, 2004 (collectively ‘Cross-Complainants’).

The Cross-Complaint alleges the following relevant facts: “The claims brought by [Cross-Defendant] in this action were assigned to it by J. Label, Inc.” (XC ¶6.) “In the FAC, [Cross-Defendant] alleges that Cross-Complainants, operating under the name ‘Angel Kiss’, purchased and obtained wholesale fabric from NCR’s assignor, J Label, and are thus indebted to J Label in the net amount of $215,357.89.” (XC ¶12.) “Cross-Complainants have never operated under the name ‘Angel Kiss. [¶] Cross-Complainants have never purchased fabric, or any other good or service, from J Label.” (XC ¶¶14-15.) “Cross-Complainants… allege, that Kim and PVE… purchased and obtained from J Label the wholesale fabrics referenced in the FAC.” (XC ¶17.) Cross-Complainants allege that that Kim and PVE, solely, are responsible for the amounts alleged to be due and owing to NCR and J Label from ‘Angel Kiss’ in the FAC.” (XC ¶18.)

The XC asserts one sole cause of action for Declaratory Relief.

Cross-Defendants HWAN KIM and PVE EK LLC (collectively “Cross-Defendants”) argue that they were not involved in the subject transactions and have no personal knowledge of any facts relevant to a determination of liabilities between J. Label on the one hand, and Cross-Complainants L.A. Grand Clothing, Inc., SSS Apparel, Inc. and Okhovat on the other.

There are two essential elements for declaratory relief: “(1) a proper subject of declaratory relief, and (2) an actual controversy involving justiciable questions relating to [plaintiff’s] rights or obligations.” (Brownfield v. Daniel Freeman Marina Hospital (1989) 208 Cal.App.3d 405, 410.)

Declaratory relief is a broad remedy, and the rule that a pleading is to be liberally construed is particularly applicable to a claim for declaratory relief. (See City of Tiburon v. Northwestern Pac. R.R. Co. (1970) 4 Cal.App.3d 160, 170.)

The Demurrer is OVERRULED.

Here, the XC sufficiently alleges the following facts: “Kim and PVE… operated under the name ‘Angel Kiss.’” (XC ¶16.) “Cross-Complainants allege that Kim and PVE, solely, are responsible for the amounts alleged to be due and owing to NCR and J Label from ‘Angel Kiss’ in the FAC.” (XC ¶18.)

The Court finds the XC adequately alleges that an actual and immediate controversy exists between the parties regarding their rights and duties with respect to each other for purposes of surviving demurrer. The arguments raised in the instant demurrer raise factual determinations inappropriately resolved at this stage in the litigation.