Judge: Malcolm Mackey, Case: 20STCV43214, Date: 2023-01-23 Tentative Ruling


Case Number: 20STCV43214    Hearing Date: January 23, 2023    Dept: 55

RADOSEVICH v. LOS FELIZ BLISS, LLC                                            20STCV43214

Hearing Date:  1/23/23,  Dept. 55

#3:   MOTION FOR SUMMARY ADJUDICATION OF LFB’S DUTY TO DEFEND AMC WITH RESPECT TO THE PLAINTIFF’S COMPLAINT.

 

Notice:  Okay

Opposition

 

MP:  Defendant/Cross-Complainant, AMC, CA, INC. dba APARTMENT MANGEMENT CONSULTANTS.

RP:  Defendant/Cross-Defendant LOS FELIZ BLISS, LLC.

 

Summary

 

On 11/12/20, Plaintiff MATTHEW SMITH RADOSEVICH filed a Complaint alleging:   Plaintiff leased 4646 Los Feliz Boulevard, apartment 312, Los Angeles, owned by Defendant LOS FELIZ BLISS LLC, and initially managed by Defendant SUREN SINGH doing business as MONDIAL PROPERTIES, including Addendum #3 providing for $8,220.00 rent paid through January 31, 2021.  In or about May 2020, the owner, and successor manager APARTMENT MANAGEMENT CONSULTANTS LLC  (AMC) changed the locks on the apartment, to prevent Plaintiff’s reentry, and also disposed of his personal property.

The causes of action are:

(1) FRAUD

(2) BREACH OF CONTRACT

(3) CONVERSION

(4) MONEY RECEIVED

(5) BREACH OF COVENANT OF GOOD FAITH AND FAIR DEALING

(6) BREACH OF COVENANT AND RIGHT TO QUIET ENJOYMENT

(7) NEGLIGENCE

(8) WRONGFUL EVICTION.

 

On 1/20/22, Defendant APARTMENT MANAGEMENT CONSULTANTS, LLC filed a Cross-Complaint against Defendant LOS FELIZ BLISS, LLC., having causes of action for (1) BREACH OF CONTRACT (CONTRACTUAL INDEMNIFICATION) and (2) DECLARATORY RELIEF.

On 3/3/22, LOS FELIZ served a cross-complaint against defendants MZL PROPERTIES INC, SUREN SINGH and MONDIAL PROPERTIES, having causes of action for (1) Equitable Indemnity, (2) Partial Equitable Indemnity, (3) Contribution and Equitable Apportionment, (4) Declaratory Relief, and (5) Implied Equitable Indemnity.

On 7/19/22, Defendant/Cross-Defendant MZL PROPERTIES INC. filed a motion for leave to file a Cross-Complaint against LOS FELIZ, for breach of a Management Agreement’s indemnity and hold harmless provisions.

 

 

MP Positions

 

Moving party requests an order granting summary adjudication of opposing party’s duty to defend with respect to the Complaint, on bases including the following:

 

·         The claims alleged against AMC in the plaintiff’s complaint potentially fall within the coverage of the indemnity obligation under the subject contract, and AMC has tendered the defense of the plaintiff’s complaint to LFB.  LFB is contractually obligated to defend AMC, the duty to defend has been triggered by AMC’s tender. 

·         Duty can be summarily adjudicated.  Whether AMC can prove that it sustained damages, from LFB’s breach of this duty, will be determined at trial. Whether AMC’s and/or LFB’s insurance is already providing a defense to AMC, are issues that are independent of and not relevant to a summary adjudication of LFB’s contractual duty to defend AMC with respect to the claims alleged in the plaintiff’s complaint.

·         Section 11.1(A) of the subject Property Management Agreement (“PMA”) between LFB, as Owner, and AMC, as Manager, provides:

o   “[LFB] shall indemnify, defend and save [AMC] harmless from any and all claims . . . relating to or arising out of the performance by [AMC] if its services under this Agreement, except for that which is caused by the gross negligence of [AMC].” Section 11.1(B) of the PMA provides that “[LFB] shall indemnify, defend and save [AMC] harmless from any and all claims . . . involving an alleged or actual violation by [LFB] of any statute, rule or regulation pertaining to the premises, property, the management or operation of the Project [the subject apartment complex], except to the extent that such a claim . . . resulted from the negligence and/or intentional misconduct of AMC.”

·         If the allegations of the complaint potentially fall within the coverage of a contractual indemnity obligation, then the indemnitor will be obligated to assume the defense of the action. Crawford v. Weather Shield Mfg., Inc. (2008) 44 Cal.4th 541, 558.

·         Unless a contractual indemnity agreement expressly states otherwise, a duty to defend under a contractual indemnity agreement arises immediately upon the tendering of a claim alleging facts that would give rise to a duty to indemnify; the duty to defend is not dependent upon an evaluation or determination of the indemnitee’s liability. See Civil Code Section 2278(4); Crawford, supra; Centex Homes v. R-Help Construction Co., Inc. (2019) 32 Cal.App.5th 1230, 1233-1234.

·         The claims alleged in the plaintiff’s complaint against AMC are based on the plaintiff’s alleged tenancy in an apartment building owned by LFB and managed by AMC, and the plaintiff’s alleged wrongful eviction from the property caused, at least in part, from AMC’s performance of its management services under the PMA.

·         AMC’s motion is not seeking an adjudication of a duty under Section 11.2.B of the PMA, and LFB’s opposition fails to articulate why an issue of fact with respect to Section 11.2.B of the PMA somehow creates a triable issue of fact as to the duty to defend under Section 11.1.A of the PMA.

 

 

RP Positions

 

Opposing party advocates denying the motion, on grounds including the following:

 

1. A triable issue of material fact exists as to LFB’s duty to defend AMC;

2. AMC’s Motion for Summary Adjudication is Prohibited as it Seeks an Advisory

Opinion;

3. AMC’s Motion Should Be Denied as it Has Failed to Show it Has Incurred Defense

Fees and Costs to Trigger a Duty to Defend; and

4. The Motion Fails as Both AMC and LFB are Insured, and Their Respective Insurance

Carriers are Providing a Defense.

(Opposition, p. 1.)

 

 

Tentative Ruling

 

The motion is granted, as prayed.

 

            Procedure

Defendants may seek summary adjudication of issues of duty without seeking to resolve an entire cause of action.  Public Utilities Com. v. Sup. Ct. (2010) 181 Cal. App. 4th 364, 380;  Linden Partners v.  Wilshire Linden Assocs.  (2d. Dist. 1998) 62 Cal.App.4th 508, 519.   But see  Regan Roofing Co.  v.  Sup.  Ct.  (4th Dist. 1994) 24 Cal.App.4th 425, 436 (split of authority), disapproved on other grounds by  Crawford v. Weather Shield Mfg. Inc. (2008) 44 Cal. 4th 541, 563.

Where there is a split of authority, trial courts have discretion to choose between the decisions.  Auto Equity Sales, Inc.  v.  Sup.  Ct.  (1962) 57 Cal.2d 450, 456.  Where there is a split of authority, “[a]s a practical matter, a superior court ordinarily will follow an appellate opinion emanating from its own district even though it is not bound to do so.”  McCallum v. McCallum  (1987) 190 Cal.App.3d 308, 316 n.4.

 

            Duty to Defend

 

The opposition raises immaterial arguments, such as whether there was negligence or gross negligence, or damages.  "The presence of a factual dispute will not defeat a motion for summary judgment unless the fact in dispute is a material one."  Saldana v.  Globe-Weis Systems Co.  (1991) 233 Cal.App.3d 1505, 1518.

Here, the facts of the subject contract and Complaint are material to analyze the issues.  The Complaint does not allege that only the indemnity exceptions of negligence or gross negligence were involved in the alleged violations, and therefore the allegations are covered.  Additionally, the subject indemnification provision does not require damages, or the lack of any defending insurers, as any precondition to the duty to defend.

 

A treatise summarizes applicable substantive law on express indemnity as to non-insurers, as follows:

 

Crawford v. Weather Shield Mfg. (2008) 44 C.4th 541, 79 C.R.3d 721, 187 P.3d 424, involved the scope of the duty to defend in an indemnity provision between a contractor and subcontractor. Homeowners sued the contractor and subcontractor for construction defects, and the contractor cross-complained against the subcontractor for indemnity and defense under the indemnity provision, requiring the subcontractor to indemnify the contractor for damages arising from the execution of the subcontractor's work and to defend “any suit or action” brought against the contractor “founded upon” a claim of such damages. The jury found that the subcontractor was not negligent, but in a separate proceeding on the cross-complaint, the trial court ordered the subcontractor to pay attorneys' fees the contractor had incurred. Held, affirmed.

(a) Parties to a construction contract may define their duties toward one another, may require one party to indemnify the other, and may assign one party the responsibility for the other's legal defense against third-party claims. These agreements are construed under the same rules as other contracts, but C.C. 2782 imposes some absolute limits on the enforceability of noninsurance indemnity agreements in the construction industry. C.C. 2778 sets forth general rules for the interpretation of indemnity contracts, including the defense obligations of indemnitors. (44 C.4th 551.)

(b) Here, the parties' agreement expressly obligated the subcontractor to defend, from the outset, any action against the contractor founded on the subcontractor's negligent role in the construction, even if it was later determined in the same litigation that the subcontractor was not negligent. (44 C.4th 553.) Under C.C. 2778(3) and 2778(4), the indemnitor's duty to defend is different from an obligation, after the fact, to pay defense costs another has incurred. (44 C.4th 554.) By specifying a duty to defend, C.C. 2778(4) places in every indemnity contract, unless the agreement provides otherwise, a duty to assume the indemnitee's defense, if tendered, against all claims embraced by the indemnity. (44 C.4th 557.) The agreement here did not limit the subcontractor's duty to defend only to those claims to which the subcontractor ultimately owed indemnity. (44 C.4th 558.) (See UDC-Universal Dev., LP. v. CH2M Hill (2010) 181 C.A.4th 10, 17, 103 C.R.3d 684 [under broad indemnity provision, subcontractor had duty to defend developer from time defense was tendered, even though underlying complaint did not specifically allege negligence on part of subcontractor, and jury ultimately found subcontractor not to be negligent; following Crawford]; 50 Santa Clara L. Rev. 825 [Crawford and its consequences for design professionals].)

SUPPLEMENT

See Centex Homes v. R-Help Const. Co. (2019) 32 C.A.5th 1230, 1233, 244 C.R.3d 574 [question whether subcontractor had duty to defend developer in tort action under indemnity agreement was question of law, and trial judge improperly delegated issue to jury; duty to defend arises as matter of law from mere allegation in underlying tort action that plaintiff's injuries arose out of subcontractor's work].

 

Duty To Defend Where Indemnitor Is Found Not Negligent., 5 Witkin, Summary 11th Torts § 234 (2022).

 

 

            Objections

 

The Court has considered the evidentiary objections in making its ruling.  As to summary judgment or adjudication motions, judges need only rule on evidentiary objections deemed material to the disposition.  CCP §437c(Q).