Judge Mark E. Windham, Case Number: 23NWLC06651, Date: 2024-05-13 Tentative Ruling

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Creditors Adjustment Bureau, Inc. v. Figueroa Maintenance Services, Inc., et al.

LEAVE TO AMEND PLEADING

Plaintiff Creditors Adjustment Bureau, Inc.’s Motion for Leave to File a First Amended Complaint is GRANTED. THE FIRST AMENDED COMPLAINT IS TO BE FILED AND SERVED WITHIN 20 DAYS OF THIS ORDER.

Plaintiff Creditors Adjustment Bureau, Inc. (“Plaintiff”) filed the instant action against Defendant Figueroa’s Maintenance Services, Inc. aka Figueroa’s Maintenance Services (“Defendant”) on March 13, 2023. On June 27, 2023, Defendant filed an answer. The case was originally assigned to the collections hub before being transferred to the limited jurisdiction court. (Minute Orders, 11/28/23 and 12/03/23.)

Plaintiff filed the instant Motion for Leave to File a First Amended Complaint on March 6, 2024. No opposition has been filed to date.

The Complaint alleges causes of action for breach of contract, open book account, account stated, and reasonable value with respect to Defendant’s alleged failure to pay insurance premiums owed to Plaintiff’s assignor, State Compensation Insurance Fund. (Compl., ¶¶11-14.) Plaintiff now moves for leave to file a First Amended Complaint under Code of Civil Procedure section 473, subdivision (a) and section 576. Specifically, Plaintiff seeks leave to file a First Amended Complaint to assert treble damages in the prayer for damages based on Defendant’s failure to complete a physical audit for the 2021 insurance policy at issue. (Motion, Aphosian Decl., ¶¶3-8.) Discovery to complete the audit was propounded on Defendant in June 2023 but Defendant did not comply with the requirements to complete the audit. (Id. at ¶¶3-8 and Exh. 1.) Treble damages for Defendant’s alleged non-cooperation with the audit are available pursuant to Insurance Code section 11760.1. (Id. at ¶7.)

A motion for leave to amend a pleading must comply with the procedural requirements of California Rules of Court, Rule 3.1324, which requires a supporting declaration to set forth explicitly what allegations are to be added and where, and explicitly stating what new evidence was discovered warranting the amendment and why the amendment was not made earlier. The motion must also include (1) a copy of the proposed and numbered amendment, (2) specifications by reference to pages and lines of the allegations that would be deleted and added, and (3) a declaration specifying the effect, necessity and propriety of the amendments, date of discovery and reasons for delay. (Cal. Rules of Court, Rule 3.1324, subds. (a), (b).)

As noted above, Plaintiff’s Motion is supported by a declaration explaining what new evidence was discovered warranting the amendment and why the amendment was not made earlier. A copy of the proposed First Amended Complaint is attached to the Motion. (Id. at Exh. 3.) Finally, the Motion “set[s] forth explicitly what allegations are to be added and where” with “specifications by reference to pages and lines of the allegations that would be deleted and added” as required by CRC Rule 3.1324. (Motion, pp. 5:12-7:13.)

The policy favoring amendment and resolving all matters in the same dispute is “so strong that it is a rare case in which denial of leave to amend can be justified. . . .” (Magpali v. Farmers Group (1996) 48 Cal.App.4th 471, 487.) However, “[a] different result is indicated ‘where inexcusable delay and probable prejudice to the opposing party’ is shown. [Citation].” (Ibid.) Here, Plaintiff seeks leave to amend the Complaint to address Defendant’s filing of the cross-complaint There is no indication of excusable delay nor prejudice to Defendant.

Therefore, Plaintiff Creditors Adjustment Bureau, Inc.’s Motion for Leave to File a First Amended Complaint is GRANTED. THE FIRST AMENDED COMPLAINT IS TO BE FILED AND SERVED WITHIN 20 DAYS OF THIS ORDER.