Judge: Mark A. Young, Case: 21STCV30134, Date: 2023-01-10 Tentative Ruling

Case Number: 21STCV30134    Hearing Date: January 10, 2023    Dept: M

CASE NAME:           Delbuck, v. Bristol Farms, et al.

CASE NO.:                21STCV30134

MOTION:                  Motion for Summary Judgment/Adjudication

HEARING DATE:   1/10/2023

 

Legal Standard

 

            A party may move for summary judgment in any action or proceeding if it is contended the action has no merit or that there is no defense to the action or proceeding. (CCP § 437c(a).) “The purpose of the law of summary judgment is to provide courts with a mechanism to cut through the parties' pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.)

 

“A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has no merit, that there is no affirmative defense to the cause of action, that there is no merit to an affirmative defense as to any cause of action, that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs.” (CCP, § 437c(f)(1).) If a party seeks summary adjudication as an alternative to a request for summary judgment, the request must be clearly made in the notice of the motion. (Gonzales v. Superior Court (1987) 189 Cal.App.3d 1542, 1544.)  “[A] party may move for summary adjudication of a legal issue or a claim for damages other than punitive damages that does not completely dispose of a cause of action, affirmative defense, or issue of duty pursuant to” subdivision (t). (CCP, § 437c(t).) 

 

            To prevail, the evidence submitted must show there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law. (CCP, § 437c(c).) The motion cannot succeed unless the evidence leaves no room for conflicting inferences as to material facts; the court has no power to weigh one inference against another or against other evidence. (Murillo v. Rite Stuff Food Inc. (1998) 65 Cal.App.4th 833, 841.) In determining whether the facts give rise to a triable issue of material fact, “[a]ll doubts as to whether any material, triable, issues of fact exist are to be resolved in favor of the party opposing summary judgment…” (Gold v. Weissman (2004) 114 Cal.App.4th 1195, 1198-99.) “In other words, the facts alleged in the evidence of the party opposing summary judgment and the reasonable inferences there from must be accepted as true.” (Jackson v. County of Los Angeles (1997) 60 Cal.App.4th 171, 179.) However, if adjudication is otherwise proper the motion “may not be denied on grounds of credibility,” except when a material fact is the witness’s state of mind and “that fact is sought to be established solely by the [witness’s] affirmation thereof.” (CCP, § 437c(e).) 

 

            Once the moving party has met their burden, the burden shifts to the opposing party “to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto.” (CCP § 437c(p)(1).) “[T]here is no obligation on the opposing party... to establish anything by affidavit unless and until the moving party has by affidavit stated facts establishing every element... necessary to sustain a judgment in his favor.” (Consumer Cause, Inc. v. SmileCare (2001) 91 Cal.App.4th 454, 468.) 

 

“The pleadings play a key role in a summary judgment motion. The function of the pleadings in a motion for summary judgment is to delimit the scope of the issues and to frame the outer measure of materiality in a summary judgment proceeding.” (Hutton v. Fidelity National Title Co. (2013) 213 Cal.App.4th 486, 493, quotations and citations omitted.) “Accordingly, the burden of a defendant moving for summary judgment only requires that he or she negate plaintiff's theories of liability as alleged in the complaint; that is, a moving party need not refute liability on some theoretical possibility not included in the pleadings.” (Ibid.) 

 

EVIDENTIARY ISSUES

 

Cross-Defendant Jade’s Objections

 

Objection nos. 1-2, which refer to the deposition of Jeffory Southard in the matter of Rembaum v. Bristol Farms, et al., LASC Case No. 19STCV14789, attached as Exhibit B to Compendium of Evidence, and referenced in Paragraph 2 of the Declaration of Mark I. Melo.

 

In opposition, Jade argues Bristol Farms failed to authenticate or lay the foundation for the operative contract – the Floor Services Agreement – through the Southard Deposition.  At his June 16, 2020, Deposition, Jade Opco’s current President and CEO (and Paramount’s former President and CEO) confirmed that Jade Opco both assumed and was bound by the relevant contract. (UMF 7.)  As cited in the Motion, Mr. Southard testified that Jade Opco continued to provide floor care services to Bristol Farms as outlined in the original Agreement, long after Jade Opco acquired the assets of its predecessor, Paramount Building Solutions. (UMF 6 & 7.)

 

Mr. Southard testified regarding the nature of the contractual relationship between Bristol Farms and Jade Opco as follows:

 

“Q. …And at that time that the – that the company was purchased by Jade Opco, Paramount had a contract dated January ‘17 between itself and Bristol Farms that you have been looking at today. You are aware of that, correct? A Yes. Q And as far as what has been shown to you at this deposition, that's the contract that you were operating under in 2017, correct? A That's correct. Q And it was a contract you were operating under in 2018, correct? A That's correct. Q And it was the contract you were operating under on the day of this incident on January 6th, 2019, correct? A Correct. Q And as far as you are concerned, that contract was in full force and effect at this time of this incident, correct? ... [Objection.] …Just as far as your understanding as the president and CEO of the company. I understand the objection. THE WITNESS: Yeah, absolutely. That's what we’re – that's what we're operating under.

 

(UMF No. 7; Exhibit B, Southard Depo., pp. 83:13-84:5.)

 

“Q And you believe that the 2017 contract was binding on Jade Opco, correct? A Yes.” (UMF No. 7; Exhibit B, Southard Depo., pp. 94:12-14.)

 

“Q With regard to the contract, even though the contract identifies Paramount as one of the parties to the written contract, you believe that it is binding on Jade Opco, right? … THE WITNESS: Yes, we -- yeah, we accepted that contract. When we acquired the company, we took on that contract.”

 

(UMF No. 7; Exhibit B, Southard Depo., pp. 94:20-95:5.)

 

“Evidence of a statement is not made inadmissible by the hearsay rule when offered against the declarant in an action to which he is a party in either his individual or representative capacity, regardless of whether the statement was made in his individual or representative capacity.” (Evid. Code § 1220.) Thus, an out-of-court statement is admissible to prove its truth if offered against the declarant in an action to which the declarant is a party. (Estate of Anderson (1997) 60 Cal.App.4th 436, 441.) This hearsay exception recognizes that an agent's statements within the scope of the agent's actual or implied authority are binding on the principal. (See Civ. C. § 2330 et seq.) Therefore, a statement by a party's agent who is authorized to speak for the party on the subject matter of the statement is imputed to the party and, when offered against the party, is admissible as a party admission. (See Colarossi v. Coty US Inc. (2002) 97 Cal.App.4th 1142, 1150.)  

 

Here, Jade’s CEO/President’s former testimony related to the operative contract, and it is admissible under Evidence Code sections 1220 and 1222. Mr. Southard’s statements regarding Jade’s ongoing relationship with Bristol Farms in compliance with the Service Agreement, and his admissions that Jade was bound to it, constitute admissions against Jade Opco’s interests. Therefore, Jade’s hearsay objections are OVERRULED.

 

Objection nos. 3-6, which refer to the declaration of Lynn Melillo.  Ms. Melillo testifies that she has personal knowledge of the Jade Opco Agreement (the “Agreement”), and that the Agreement includes the store where Plaintiff’s incident occurred and was in effect at the time of the incident. Ms. Melillo also lays a foundation for her testimony that a Jade Opco employee was working at the subject store on the date of the incident as part of her regular work duties. Thus, the personal knowledge objection is OVERRULED.

 

Objection nos. 7-9, which refer to the tender letters (exhibits E, G).  The tender letters are not offered for the truth of any matters asserted therein. Likewise, the interrogatory responses are not offered for the truth of the matters asserted, but only that Plaintiff was making such claims. Thus, the hearsay objections are OVERRULED.

 

Analysis

 

Initial Burden

 

Cross-Complainant moves for adjudication on the following two issues:

 

Issue No. 1: Jade Opco has no defense as to Bristol Farms’ Seventh Cause of Action for Declaratory Relief – Duty to Defend, as Jade Opco has a contractual duty to defend Bristol Farms against Plaintiff’s instant action as a matter of law.

 

Issue No. 2: Jade Opco currently has, and has had, a duty to defend Bristol Farms in this case since the October 29, 2021 date of Bristol Farms’ tender to Jade Opco.

 

Both issues embrace Jade’s contractual duty to defend Bristol in the underlying case. In general, indemnity refers to “the obligation resting on one party to make good a loss or damage another party has incurred.” (Rossmoor Sanitation, Inc. v. Pylon, Inc. (1975) 13 Cal.3d 622, 628.)  Historically, the obligation of indemnity took three forms: (1) indemnity expressly provided for by contract (express indemnity); (2) indemnity implied from a contract not specifically mentioning indemnity (implied contractual indemnity); and (3) indemnity arising from the equities of particular circumstances (traditional equitable indemnity). (PPG Industries, Inc. v. Transamerica Ins. Co. (1999) 20 Cal.4th 310, 318.) Express indemnity refers to an obligation that arises “‘by virtue of express contractual language establishing a duty in one party to save another harmless upon the occurrence of specified circumstances.’” (Bay Development, Ltd. v. Superior Court (1990) 50 Cal.3d 1012, 1029–1030.) Express indemnity generally is not subject to equitable considerations or a joint legal obligation to the injured party; rather, it is enforced in accordance with the terms of the contracting parties' agreement. (Markley v. Beagle (1967) 66 Cal.2d 951, 961.)

 

In the context of noninsurance indemnity agreements, if a party seeks to be indemnified for its own active negligence, or regardless of the indemnitor's fault, the contractual language on the point “must be particularly clear and explicit, and will be construed strictly against the indemnitee.” (Crawford v. Weather Shield Mfg. Inc. (2008) 44 Cal.4th 541, 552.) In this sense, express indemnity allows contracting parties “great freedom to allocate [indemnification] responsibilities as they see fit,” and to agree to “protections beyond those afforded by the doctrines of implied or equitable indemnity.” (Id. at 551–552.)

 

In Crawford, the California Supreme Court held a subcontractor who signed an agreement to indemnify a general contractor owed that general contractor an implied duty to defend. There, the Court considered whether that duty was triggered where the subcontractor’s indemnification obligation was potentially triggered by the allegations in the underlying action. Civil Code § 2778(4) mandated a separate and immediate duty to defend, stating that “unless the parties' agreement expressly provides otherwise, a contractual indemnitor has the obligation, upon proper tender by the indemnitee, to accept and assume the indemnitee's active defense against claims encompassed by the indemnity provision.” (Id. at 555.)  The Court held that even though the subcontractor was found to be without fault for negligence at trial, the mere allegations by plaintiff were sufficient to trigger the obligation to immediately defend the contractor in the negligence action under the indemnity agreement.

 

Bristol Farms presents the governing Service Agreement, and how Jade acquired interests under it.  The Agreements, holds in relevant part:

 

INSURANCE. PERMITS. LICENSES & INDEMNIFICATION Contractor will obtain all necessary permits, authorizations and licenses, and will pay all fees, licenses, and taxes in connection with the work. Contractor is an independent contractor, and Customer is not accountable in any manner for any violations of City, County, State or Federal Laws, Ordinances or regulations, or for the injury, death, loss or damage arising from any cause in the performance of such work. Contractor shall indemnify, defend and hold Customer harmless from and against the following: Any and all losses or damage to Customer's property, and any and all liability, loss or expense (including costs of investigation and attorneys fees) in connection with any claim, demand, liability, action or cause of action asserted against Customer because of any injury to or death of any person or for the loss of or damage to any property when such injury, death, loss or damage, however caused, allegedly results from, arises out of, or is in any way connected with the performance of the work or Contractor's breach of this Agreement, whether before or after completion, by Contractor, its agents, and employees. [¶] Contractor agrees to provide Commercial General Liability Insurance, Auto Liability Insurance and Workers Compensation Insurance to the limits required by Customer.

 

(UMF No. 2; Exhibit A, pp. 2-3, emphasis added.)

 

Additionally,

 

Contractor shall maintain a policy of Commercial General Liability Insurance with coverage at least as broad as the Insurance Service Office (ISO) Commercial General Liability Coverage ‘occurrence’ form, with no coverage deletions. The limit shall not be less than $2,000,000 each occurrence for bodily injury, property damage and personal injury. If coverage is subject to general aggregate limit, this aggregate limit shall be twice the occurrence limit. [¶] Coverage shall: a) By Additional Insured'' endorsement ads as [sic] insured's Customer, its directors, officers, agents and employees with respect to liability arising out of work performed by or for the Contractor; b) Be endorsed to specify that the Contractor's insurance is primary and that any insurance or self-insurance maintained by Customer or its parent shall not contribute with it.

 

(UMF No. 3; Exhibit A, pp. 3.)

 

            Plaintiff’s claims against Bristol Farms triggered the indemnity provision. In her complaint, Plaintiff alleges that she suffered injuries to both of her knees when she slipped on olive oil or some other liquid substance on the floor near the olive bar at a grocery store operated by Bristol Farms in West Hollywood, California on December 10, 2020. In formal discovery, Plaintiff contended that “[t]he spill was partially cleaned by Defendant and/or its agent(s) prior to Ms. Delbuck’s fall.” (Exhibit H, Suppl. Response No. 23.)

 

Under the Agreement, Jade Opco was obligated to provide various custodial and floor care cleaning services to Bristol Farms at the Store, including but not limited to, maintaining and cleaning the floors.  For example, the “Contractor agrees to sweep, dust, mop, clean and buff the floors daily, and to scrub, recoat, and strip the floors as needed as more particularly described in Exhibit 'A’; Scope of Work.” (UMF No. 4.) “Bristol expects… All areas will be cleaned with an eye for detail. For example, no stains on carpets from water or chemical splashing onto carpet edges from the scrubber. Tile surfaces must be clean, bright and shiny every day. Dirt must be cleaned in the corners, behind base deck corner guards and along walls and doors.  Pursuant to section 3B of the Agreement, Sales Floor, the following obligations are imposed:

• Dust mop, damp mop, auto scrub and apply finish (if applicable) to all sales floor hard surfaces as described in Hard Surfaces…

• Ensure flooring is slip-free by store opening – Daily

And under section 5, Day Porter Responsibilities:

• Sweeping sales floor as needed throughout the day – Daily

 

Bristol Farms also provides evidence as to how Jade Opco became responsible under the Agreement.  In January 2017, prior to the subject Incident, Bristol Farms entered into a Floor Care Service Agreement with Jade’s predecessor-in-interest, Paramount Building Solutions, LLC (“Paramount”). Paramount filed for bankruptcy protection prior to the loss, and its assets – including the January 2017 Agreement – were acquired by Jade Opco. Thereafter, Jade Opco assumed Paramount’s rights and obligations under the Agreement, and continued to act in accordance with the terms and conditions thereof. (Exhibit B, Southard Depo., pp. 20:9-22:19.)

 

The evidence further demonstrates that Jade Opco and Bristol Farms continued to act in compliance with the terms of the Agreement. (UMF No. 8.) Jade Opco continued to provide day porter and floor care services as described in the Agreement at the Bristol Farms’ stores listed therein (including the subject Store), and Bristol Farms paid Jade Opco for those services. (UMF No. 8.) Jade Opco had liability insurance coverage effective from November 30, 2020, through November 30, 2021, and Bristol Farms was specifically listed as an additional insured under Jade Opco’s liability insurance coverage during that time period, as required by the Agreement. (UMF No. 8; Exhibit C.)

 

On August 13, 2021, Plaintiff filed her complaint against Bristol Farms asserting causes of action for: (1) Premises Liability; and (2) Negligence. Plaintiff expressly alleges that Bristol Farms and Does “so negligently owned, leased, occupied, controlled, possessed, supervised, inspected, leased, maintained, and/or managed the area where Plaintiff was injured such that unsafe and dangerous conditions existed, which led to the incident causing Plaintiffs’ injuries at the Premises.” (Compl., ¶ 6.) The complaint further alleges that “Defendants also failed to take reasonable steps to repair, replace, and/or give adequate warning of the dangerous and unsafe condition of the area that Defendants, and each of them, created and/or failed to repair or give adequate warning of the dangerous condition, despite substantial time to take corrective action.” (Compl., ¶ 11.) “The subject dangerous and unsafe condition created an unreasonable risk of harm about which Defendants, and each of them, knew because said defendants created the condition, or the condition was one which Defendants, in the exercise of reasonable care, should have discovered through reasonable periodic inspections of the Premises.” (Compl., ¶ 12.)

 

On October 29, 2021, and May 3, 2022, Bristol Farms tendered its defense and indemnity to Jade Opco based on the express terms and conditions of the Floor Care Service Agreement. (Exs. E & G.) In the interim, on November 18, 2021, Bristol Farms filed its own Cross-Complaint against Jade Opco, asserting causes of action for: (1) Comparative Indemnity and Apportionment of Fault; (2) Total Equitable Indemnity; (3) Contribution; (4) Declaratory Relief; (5) Contractual Indemnity (as to Jade Opco); (6) Breach of Contract (as to Jade Opco); (7) Declaratory Relief – Duty to Defend (as to Jade Opco); and (8) Declaratory Relief – Duty to Indemnify (as to Jade Opco). (Exhibit F.)

 

Jade argues that the underlying complaint did not trigger the indemnity provisions. However, the underlying claims made by plaintiff are “embraced” by the indemnity provision because Plaintiff alleged that she fell as the result of the floor being “negligently… inspected… [and] maintained.”  Under Crawford, Jade’s duty to defend Bristol in this action was immediately triggered by the allegations pertaining to negligent maintenance of floors. Although named as a doe, Jade had sufficient information from its contract and Plaintiff’s complaint to determine that the indemnification obligation was potentially triggered.

 

Therefore, Bristol meets its initial burden demonstrating that Jade had a duty to defend Bristol Farms.

 

Jade Opco’s Response

 

Jade Opco does not meet its burden to demonstrate that there is triable issue of fact as to whether the Floor Care Services Agreement is the full and complete contract between the parties. Jade proffers contentions and speculation that there might be more to the contract.  At the second stage of the summary adjudication analysis, Jade must show that these issues, including whether there was a contract between the parties, the terms of the contract etc., would defeat summary judgment. More importantly, Jade Opco must answer these questions with support from substantive evidence to create a dispute of material fact. If there is a different contract between the parties, Jade should have produced that contract for the Court’s consideration in light of the evidence submitted by Bristol Farms.

 

            Accordingly, Bristol Farm’s motion is GRANTED.