Judge: Malcolm Mackey, Case: 19STCV23612, Date: 2023-01-11 Tentative Ruling
Case Number: 19STCV23612 Hearing Date: January 11, 2023 Dept: 55
LORENZO
v. LOS MORALES TRUCKING, INC. 19STCV23612
Hearing Date: 1/11/23
Dept. 55
#10:
MOTION FOR SUMMARY JUDGMENT ON PLAINTIFFS’ OPERATIVE
SECOND AMENDED COMPLAINT.
MOTION FOR SUMMARY JUDGMENT ON PLAINTIFFS’ OPERATIVE
SECOND AMENDED COMPLAINT.
Notice: Okay
Opposition
MP:
Defendant COMMODITY TRUCKING ACQUISITION LLC dba
DISPATCH TRANSPORTATION.
Defendant COMMODITY TRUCKING HOLDINGS, LLC
RP:
Plaintiffs
Summary
On 7/3/19, plaintiffs filed the lead action,
Lorenzo v. Los Morales (19STCV23612) against the trucking defendants.
On 3/30/20, plaintiffs filed the Complaint,
Lorenzo v. LAUSD (20STCV12415), against LAUSD and others.
On 1/13/21, this lead case was ordered consolidated
for all purposes with 20STCV23961 and 20STCV12415.
On 2/3/21, plaintiffs filed the Second Amended
Complaint, regarding separately filed wrongful death lawsuits that arise
out of the same double fatal pedestrian accident. Allegedly, plaintiffs are the
parents of two sisters who died in April 2019, after being run over by a dump
truck, while they were pedestrians in a crosswalk, on route to middle school,
due to the failure to provide for previously school-arranged crossing guards
for student safety on particularly dangerous streets near the school, at a time
a substitute crossing guard was needed.
On 4/2/21, GREEN DOT PUBLIC SCHOOLS CALIFORNIA and
GREEN DOT PUBLIC SCHOOLS NATIONAL were added as DOE defendants 1 and 2, to
the Second Amended Complaint.
On 7/16/21, Defendant/Cross-Complainant LOS ANGELES
UNIFIED SCHOOL DISTRICT (LAUSD) filed an official form Cross-Complaint
against GREEN DOT PUBLIC SCHOOLS CALIFORNIA, GREEN DOT PUBLIC SCHOOLS NATIONAL, ORIVERA TRUCKING, LLC; LOS MORALES TRUCKING
INC; GLOBAL HAWK INSURANCE COMPANY RISK RETENTION GROUP; and STANLEY RANDLE. The causes of action are: 1) Indemnification,
2) Apportionment of Fault and 3) Declaratory Relief.
On 6/15/21, the Court overruled the Demurrer of
LAUSD, and, on 10/6/21, the Court of Appeal summarily denied an unopposed
petition for writ of mandate filed 8/16/21, by Defendant LAUSD, which
had requested to overturn the demurrer ruling.
The Complaint in consolidated case number
20STCV23961 alleges that GLOBAL CENTURY, as insurance broker, was used by
THANDI as a device to broker insurance policies between California trucking
insureds, like LOS MORALES, a small trucking company, and the
non-California-admitted, insolvent insurer, Global Hawk, provided a policy for
indemnity in the event of catastrophic loss, but now the Lorenzo plaintiffs are
unlikely to receive any compensation from GLOBAL HAWK’S liquidation
proceedings.
MP
Position
Motion
Of Defendant COMMODITY TRUCKING ACQUISITION LLC
Moving party requests an order granting summary
judgment as against plaintiffs Second Amended Complaint, on bases including the
following:
·
At the time of the alleged accident, a
dump truck driven by Stanley Randle (an employee of Los Morales Trucking, Inc.,
a subcontractor of defendant Commodity Trucking Acquisition LLC DBA Dispatch
Transportation (CTA) was involved in a fatal collision with two pedestrians.
·
CTA neither employed Mr. Randle nor owned
or provided the subject vehicle.
·
With respect to the alleged
imputed/vicarious liability of Defendant CTA, the alleged tortfeasor (defendant
Stanley Randle) was not performing work or in the course and scope of
employment at the time of the alleged accident, but merely was going to work.
·
The accident location is not located
nearby the staging area, the job site or the 110 Freeway. A “staging” area for
dump trucks bound for the 100 S. Grand Avenue job site was located at 23rd and
Broadway, Los Angeles, California.
·
CTA has no information regarding why Mr.
Randle was driving in the accident location at close to 8:00 a.m. and he had not
been to the staging area that morning prior to the accident.
Motion Of Defendant
COMMODITY
TRUCKING HOLDINGS, LLC
Moving party requests an order granting summary
judgment as against plaintiffs Second Amended Complaint, on bases including the
following:
·
Defendant COMMODITY TRUCKING HOLDINGS, LLC
(CTH) is a holding entity that has no employees, holds no licenses, provides no
services, and was not involved with the subject Grand Avenue job.
·
CTH did not provide or contract for any
goods or services in connection with the subject job and did not act as a
principal or agent of Commodity Trucking Acquisition LLC dba Dispatch
Transportation or anyone else with respect to that job.
·The
alleged tortfeasor (defendant Stanley Randle) was not performing work at the
time of the accident.
·
CTH was not engaged in an
employer-employee, principal-agent, or contractual relationship with Stanley
Randle or Los Morales. As such, CTH owed no duty to the decedents and there
were no circumstances that could lead to vicarious liability or an indemnity obligation
for CTH.
·
The cross-complaint of LAUSD seeking
equitable indemnity and apportionment against CTH (named therein as “Roe 5”)
similarly has no merit.
RP Position
Opposition Re: Defendant
COMMODITY TRUCKING ACQUISITION LLC
Opposing parties advocate denying, for reasons
including the following:
Defendant COMMODITY
TRUCKING ACQUISITION LLC DBA DISPATCH TRANSPORTATION (“Commodity”) owes a
non-delegable duty to Plaintiffs as a “Regulated hirer.” The “Regulated hirer”
exception imputes liability to the hirer of an independent contractor when the
work delegated to the contractor involves an unreasonable risk of harm to
others and can lawfully be performed only under a license or franchise granted
by public authority. (Vargas v. FMI (2015) 233 Cal.App.4th 638, 652-654; Serna
v. Pettey (2003) 110 Cal.App.4th 1475, 1486; Eli v. Murphy (1952) 39 Cal.2d
598, 599-601; Taylor v. Oakland (1941) 17 Cal.2d 594; Rest.2d Torts 428;
California Practice Guide (Rutter) Personal Injury at ¶ 2:890.)
Under controlling
California and Federal law, although hirer Defendants including Core/Related,
Calex, Rivera, and Commodity may act through a subcontractor such as Los
Morales and its employee, Randle, nonetheless the hirer Defendants are
vicariously liable for Randle’s negligence. Such is because the underlying
activities (exporting dirt pursuant to a City issued exportation permit, and
operating double bottom dumps pursuant to state and federal for hire motor
carrier permits) are highly regulated activities involving an unreasonable risk
of harm which can only be lawfully carried out under a public franchise or
authority.
….
The hirer Defendants
benefit from Randle bringing a double bottom dump to the staging area at 23rd
and Broadway to haul dirt away from the 100 Grand jobsite, which puts his trip
in the course and scope. The risks of a double bottom dump hitting two
pedestrians is a foreseeable cost of the project, given that the project
required hundreds of millions of pounds of dirt to be hauled away, by thousands
of dump trucks, at a cost of millions of dollars on public roadways….
(Opposition, pp. 1 – 2.)
Opposition Re: Defendant COMMODITY TRUCKING HOLDINGS, LLC
Opposing parties advocate denying, for reasons
including the following:
Commodity Trucking Holdings, LLC is
the sole manager/member of Commodity Trucking Acquisition, LLC. (PAMF 1; Ex.
33, Statement of Information; Ex. 32, Operating Agreement.) The undisputed
facts establish that Commodity Trucking Holdings, LLC is the equitable owner of
the operations entity (Commodity Trucking Acquisition). The holding company
here is not an independent business, nor an ongoing concern. Rather, it only
exists to hold the equitable ownership, separate and apart from the operating
entity, so that assets can be quickly transferred to avoid liabilities. It
would be unfair to permit Commodity to escape liability for this tragic
accident simply by transferring ownership of the holding company to another
company. (‘A very numerous and growing class of cases wherein the corporate
entity is disregarded is that wherein it
is so organized and controlled, and
its affairs are so conducted, as to make it merely
an instrumentality, agency, conduit,
or adjunct of another corporation.’ [Citations.]”
(Las Palmas v. Las Palmas (1991) 235
Cal.App.3d 1220.)
It would be unjust to permit those
who control the company (i.e. the holding
company) to treat the operating
entity (Commodity Trucking Acquisition) as a
single or unitary enterprise, and
then assert their corporate separateness in order
to commit frauds and other misdeeds
with impunity.
Here, in addition to triable issue of
alter ego liability, there are triable issues
of the holding company’s culpability
for aiding and abet, and failing to abate large
scale tortious and criminal conduct
of Commodity, including operating an illegal
truck stage in school zones, and
fraudulent “pass-through” contract schemes that
that make a mockery of public
contracts designed to promote disadvantaged
business.
(Opposition, p.1.)
Tentative
Ruling
Both motions are denied.
Independent
Contractor and Regulated Hirer Exception
There is a regulated hirer exception to the general
rule of nonliability for hirers of independent contractors. Secci v. United Independant Taxi Drivers,
Inc. (2017) 8 Cal. App. 5th 846, 860.
Cf. Vargas v. FMI, Inc.
(2015) 233 Cal.App.4th 638, 644 (trucking
business regulated by Department of Transportation could not delegate
responsibility to independent contractor drivers).
Here, the Court determines that, in response to moving
parties’ evidence referenced in the separate statements, there are triable
issues of material fact, as to each issue raised, including whether the hirer
defendant effectively contracted with Los Morales and became subject to
vicarious liability operating double dumps related to regulated activities
involving an unreasonable risk of harm lawfully carried out under a public
authority (e.g., “PLAINTIFFS’
EVIDENCE IN OPPOSITION TO DEFENDANT COMMODITY TRUCKING ACQUISITION LLC DBA
DISPATCH TRANSPORTATION’S MOTION FOR SUMMARY JUDGMENT, VOLUME 5 OF 8,” exs. 17
(Deposition of Stanley Randle, pp. 11 – 165), and 27 – 28 (Commodity’s
Responses to Special Interrogatories and Admissions Requests); PLAINTIFFS’ EVIDENCE IN OPPOSITION TO
DEFENDANT COMMODITY TRUCKING ACQUISITION LLC DBA DISPATCH TRANSPORTATION’S
MOTION FOR SUMMARY JUDGMENT, VOLUME 3 OF 8,” ex. 10 (Deposition of John
Sullivan (Commodity Trucking Acquisition), pp. 28 - 31)).
Going-and-Coming
Rule and Special Risk and Special Benefit Exceptions
“ ‘Under one test, the employer is liable if the
activities that caused the employee to become an instrument of danger to others
were undertaken with the employer's permission and were of some benefit to the
employer,…” Marez v. Lyft, Inc.
(2020) 48 Cal. App. 5th 569, 577. Additionally,
“ ‘an employee's conduct is within the scope of his or her employment if (1)
the act performed was either required or incident to his duties or (2) the
employee's misconduct could be reasonably foreseen by the employer in any
event.’ ” Ibid.
As to the instant motions, the Court determines that
there are triable issues of material fact, as to each issue raised, including
whether Mr. Randle was in the course and
scope of his employment in bringing a requested tractor hauling two trailers,
to wait with other trucks for approaching the staging area, as being required
or incident to his duties, or was too late to work, and whether the conduct was
reasonably foreseeable to the employer (e.g., “PLAINTIFFS’ EVIDENCE IN
OPPOSITION TO DEFENDANT COMMODITY TRUCKING ACQUISITION LLC DBA DISPATCH
TRANSPORTATION’S MOTION FOR SUMMARY JUDGMENT, VOLUME 5 OF 8,” exs. 17
(Deposition of Stanley Randle, pp. 11 - 165), and 27 – 28 (Commodity’s
Responses to Special Interrogatories and Admissions Requests); “PLAINTIFFS’ EVIDENCE IN OPPOSITION TO
DEFENDANT COMMODITY TRUCKING ACQUISITION LLC DBA DISPATCH TRANSPORTATION’S
MOTION FOR SUMMARY JUDGMENT, VOLUME 2 OF 8,” ex. 6 (Deposition of Gabriela
Briones), pp. 36 – 37); and exh. 13 (Deposition
of Cynthia Zorn (Rivera Trucking), pp. 23 – 27)).
Alter
Ego and Aiding and Abetting
No one test controls as to the alter ego doctrine
which involves considering all of the circumstances, which may include: The commingling of funds; identical equitable ownership; the same offices; identical officers, directors and employees;
disregarding of corporate formalities; and use of one as a mere shell or
conduit for the other’s affairs. Morrison
Knudsen Corp. v. Hancock, Rothert & Bunshoft, LLP (1999) 69 Cal.App.4th
223, 250.
The elements of aiding and abetting are:
Das v. Bank of America,
N.A. (2010) 186 Cal.App.4th
727, 744; Schulz v. Neovi Data Corp. (2007)152 Cal. App. 4th 86,
95; Austin B. v. Escondido Union
School Dist. (2007) 149 Cal.App.4th 860, 879; Casey v. U.S. Bank Nat. Assn. (2005)
127 Cal. App. 4th 1138, 1144, 1149; Saunders
v. Sup. Ct. (1994) 27 Cal. App. 4th 832, 845. See
also Heckmann v. Ahmanson
(1985) 168 Cal.App.3d 119, 127 (one aiding and abetting is jointly liable even
without participating in the wrongs); Smith
v. Blodget (1921) 187 Cal. 235, 244 (aiding and abetting may be actionable
even where one was not a party to a scheme from its inception.); Am. Master Lease LLC v. Idanta Partners,
Ltd. (2014) 225 Cal. App. 4th 1451, 1477 (aider and abettor may commit an
independent tort by making a conscious decision to assist another in performing
wrongful acts.).
Here, the Court determines that there are triable
issues of material fact, as to each issue raised, including whether Defendant
COMMODITY TRUCKING HOLDINGS, LLC could be liable as an alter ego of Defendant COMMODITY
TRUCKING ACQUISITION, or as an aider-and-abettor of unsafe trucking operations (e.g.,
separate statements, fact numbers 1 - 5; and additional fact numbers 28 – 58).
Evidentiary
Objections
The Court has considered the filed evidentiary
objections in making its ruling. As to
summary judgment motions, judges need only rule on evidentiary objections
deemed material to the disposition. CCP
§437c(Q).