Judge: Mark A. Young, Case: 21STCV02647, Date: 2023-03-08 Tentative Ruling
Case Number: 21STCV02647 Hearing Date: March 8, 2023 Dept: M
CASE NAME: Sanchez v. Mizban,
et al.
CASE NO.: 21STCV02647
MOTION: Motion
for Leave to File Cross-Complaint
Motion for Leave to Amend Answer
HEARING DATE: 3/8/2023
Legal
Standard
Defendant’s Answer
If a party
wishes to amend a pleading after an answer has been filed, or after a demurrer
has been filed and after the hearing on the demurrer, or if he or she has
already amended the pleading as a matter of course, the party must obtain permission
from the court before amendment. (CCP §§ 473(a)(1), 576.)
Motions
for leave to amend the pleadings are directed to the sound discretion of the
court. “The court may, in furtherance of justice, and on any terms as may be
proper, allow a party to amend any pleading . . ..” (CCP § 473(a)(1); see CCP §
576.) Policy favors liberally granting leave to amend so that all disputed
matters between the parties may be resolved. (See Howard v. County of San Diego (2010) 184 Cal.App.4th 1422,
1428.) Absent prejudice to the adverse party, the court may permit amendments to
the complaint “at any stage of the proceedings, up to and including trial.” (Atkinson v. Elk Corp. (2003) 109
Cal.App.4th 739, 761 [internal quotes omitted].) Where leave is sought to add
entirely new claims, the court may grant leave to amend if the new claims are
based on the same general set of facts, and the amendment will not prejudice
the opposing party. (Austin v.
Massachusetts Bonding & Ins. Co. (1961) 56 Cal.2d 596, 600-602; Glaser v. Meyers (1982) 137 Cal.App.3d 770, 777 [holding
trial court did not abuse its discretion in permitting amendment of complaint,
which originally alleged constructive eviction, to allege retaliatory eviction
where the new claim was based on the same general set of facts].)
Although
denial is rarely justified, a judge has discretion to deny leave to amend if
the party seeking the amendment has been dilatory, and the delay has prejudiced
the opposing party. (Morgan v. Superior
Court (1959) 172 Cal.App.2d 527, 530; Hirsa v. Superior Court
(1981) 118 Cal.App.3d 486, 490). An opposing party is prejudiced where the
amendment would necessitate a trial delay along with a loss of critical
evidence, added preparation expense, increased burden of discovery, etc. (Magpali
v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 486-488 [leave properly
denied where plaintiff sought leave on the eve of trial, nearly two years after
the complaint was originally filed and gave no explanation for the delay which
prejudiced defendant who did not discover or depose many of the witnesses who
would support the new allegations and had not marshaled evidence in opposition
of the new allegations].)
Procedurally,
a motion for leave to amend must state with particularity what allegations are
to be amended. Namely, it must state what allegations in the previous pleading
are proposed to be deleted and/or added, if any, and where, by page, paragraph,
and line number. (CRC, Rule 3.1324(a)(2)-(3).) The motion must be accompanied
by a declaration specifying: (1) the effect of the amendment; (2) why the
amendment is necessary and proper; (3) when the facts giving rise to the
amended allegations were discovered; and (4) the reasons why the request for
amendment was not made earlier. (CRC, Rule 3.1324(b).) The motion must also be accompanied
by the proposed amended pleading, numbered to differentiate it from the prior
pleadings or amendments. (CRC, Rule 3.1324(a)(1).) It is within the court’s
discretion to require compliance with Rule 3.1324 before granting leave to
amend. (Hataishi v. First American Home Buyers Protection Corp. (2014)
223 Cal.App.4th 1454, 1469.)
Cross-Complaint
Generally, a party must file a cross-complaint against any
of the parties who filed the complaint or cross-complaint against him or her
before or at the same time as the answer to the complaint or cross-complaint. (CCP,
§ 428.50(a).) The court may grant leave to file a cross-complaint if the
failure to plead a cause of action was the result of oversight, inadvertence,
mistake, neglect, or other cause. (CCP, § 426.50.) Where the proposed
cross-complaint arises out of the same transaction as plaintiff’s claim, the
court must grant leave to file the cross-complaint as long as defendant
is acting in good faith. (Id.) Judicial policy favors resolution of all
disputed matters between the parties in the same lawsuit and discretion will
usually be exercised liberally to permit amendment of the pleadings. (Nestle
v. Santa Monica (1972) 6 Cal.3d 920, 929.)
A party may obtain leave of court to file a cross-complaint
at any time during the course of a lawsuit, and leave may be granted in the
interest of justice. (CCP, §§ 426.50, 428.50.) Courts have interpreted section
426.50 to require that a motion to file a cross-complaint be granted at any
time during the course of the action unless bad faith of the moving party is
demonstrated. (Silver Orgs. v. Frank (1990) 217 Cal.App.3d 94,
98-99 [“Factors such as oversight, inadvertence, neglect, mistake or other
cause, are insufficient grounds to deny the motion unless accompanied by bad
faith.”]; Sidney v. Superior Court (1988) 198 Cal.App.3d 710, 718
[a “strong showing of bad faith” is required].)
Analysis
First Amended Answer
Defendants Kasra Misban and Nasser
Mizban (Defendants) seek to file their First Amended Answer (FAA) with five new
affirmative defenses (20th – 24th Affirmative Defenses). Defendants
propose this FAA based on discovery, specifically, Plaintiff’s perjury and
insurance fraud relating to this action, and further facts evidencing
Plaintiff’s comparative fault. Defendant meets the procedural requirements for
this motion. Defendant provides a copy of the proposed pleading. (Kang Decl.,
Ex. X.) Defendant also shows the effect of the amendment, why the amendment is
necessary, when the facts of the amendment were discovered, and, thusly, why
the amendment was not made earlier. To sum, Defendant discovered evidence
during the course of discovery that Plaintiff who was incompetent and unfit to
drive, and that he lied prior to and during this lawsuit. According to Defendants,
Plaintiff lied about the fact that he had no insurance, that his driver’s
license was suspended, that he took medication at the time of the accident,
used his cellphone at the time of the accident, and his activity after the
accident. (See Kang Decl., ¶¶ 4-5, 10-14, 21, 25-26.) Defendants therefore
offer facts demonstrating Plaintiff’s comparative fault in the accident.
Plaintiff argues that they will be
prejudiced due to unexcused delay in seeking to amend the answer, and the
corresponding change in legal theories after two years of litigation. However,
the addition of defenses would not tend to prejudice Plaintiff as Defendant is
not significantly changing legal theories. Plaintiff has always been on notice
that Defendant contested liability and asserted that Plaintiff contributed to
and/or was at fault for the accident. The FAA’s additions do not stray from
this general argument. Conversely, denial of leave to amend would risk
prejudice to Defendants. The Court sees little value in denying leave,
especially in light of liberal amendment policies.
Plaintiff argues that none of the
proposed affirmative defenses are applicable to this matter. However, Plaintiff
provides no reasoning as to why these defenses would not apply. Even so,
Plaintiff’s substantive objections to the merits of any defense should
be addressed outside of this context. Instead, if Plaintiff believes that the
FAA fails to state a defense, Plaintiff may attack the pleading with a demurrer
or other appropriate motion.
Accordingly, Defendants’ motion for leave to
amend his answer is GRANTED.
Cross-Complaint
Defendants request that the Court
allow leave to file a compulsory cross-complaint against Plaintiff and his
sister, Veronica Garcia. Defendants seek to allege that Sanchez negligently
caused or contributed to the accident at issue in this case through his
negligent driving of the subject vehicle, and that Garcia negligently entrusted
the subject vehicle to Sanchez, despite knowing or having reason to know that
his driver’s license had been suspended by the State of California, Department
of Motor Vehicles, for medical reasons deeming him an “immediate” threat to
others and himself. Thus, Defendants argue that Plaintiff and his sister’s negligent
conduct caused or contributed to the accident at issue here. Defendants present
the proposed cross-complaint for negligent entrustment, negligence, equitable
indemnity, contribution, apportionment of fault, and declaratory relief. (Kang
Decl., Ex. X.)
Defendant notes that significant
new facts have recently come to light that previously had been actively
concealed by Sanchez and Garcia through their perjury and obstruction. Further,
Defendant argues that there is a complete overlap of parties, facts, and issues
presented by the Cross-Complaint justify granting leave. Defendant also argues
that allowing leave will not significantly delay trial of this matter given
that Garcia has already been deposed in this matter and produced her documents.
Plaintiff argues that Defendants delayed
in bringing this motion. Plaintiff filed his complaint on January 22, 2021. Defendants
filed their answer on March 8, 2021. Defendant did not first bring this motion
until a little over a year later, on March 25, 2022. Plaintiff notes that delay
is further evidenced by discovery in this matter. On June 28, 2021, in response
to Form Interrogatory No. 20.11 Plaintiff identified Veronica Garcia as the
owner of the vehicle he was driving on the date of the incident. (Hakim Decl.,
Ex. 3). On August 10, 2021, in a supplemental response to Form Interrogatory
No. 2.3, Plaintiff stated his New York driver’s license was expired at the time
of the Incident. (Ex. 4.)
Notably, prior to transfer to this
department, the Court denied leave to file the proposed cross-complaint. The
Court held that this was a permissive cross-complaint, and denied leave
because “Defendants do not explain why there has been such a delay in bringing
this motion, especially as trial is scheduled for July 22, 2022.” (May 9, 2022,
Minute Order.) The Court concludes, however, that this is not a permissive
cross-complaint, but a compulsory cross-complaint. Furthermore, in addition to
the trial no longer being set, the prior court did not note any evidence of bad
faith in delaying the motion.
On this record, the Court does not
find any substantial evidence supporting Plaintiff’s claim of prejudice or bad
faith on the part of Defendants. Defendants did not act in bad faith by waiting
until deposing Garcia to bring this cross-action against her. Defendants first
filed this motion within a reasonable time after that deposition. While
Defendants may have asserted a cross-complaint earlier, this does not substantially
evidence bad faith, or lack of good faith. At worst, this shows that any delay
was the result of oversight, inadvertence, mistake, or
neglect.
Critically,
Plaintiff does not cite any substantial prejudice that would stem from allowing
leave to file this cross-action. As Defendants recognize, this may be brought
as an independent action. As a practical matter, if Defendants file such an
action, it will be related to this action and transferred into this department.
Denying leave would only tend to complicate this case. Thus, there is little
reason to require Defendants to file a separate action.
Finally,
any substantive challenges to the pleading may be addressed via a procedurally
proper attack on the pleading. Accordingly, Defendants’ motion to file the
proposed cross-complaint is GRANTED.
Defendants
are ordered to file their proposed cross-complaint within three court days.