Judge: Michael Shultz, Case: 22CMCV00331, Date: 2024-07-16 Tentative Ruling

Case Number: 22CMCV00331    Hearing Date: July 16, 2024    Dept: A

22CMCV00331 Antonio Carlin, Guillermo Rios v. Esteban Carlin

Tuesday, July 16, 2024, at 8:30 a.m.

[TENTATIVE] ORDER GRANTING LEAVE TO FILE AN AMENDED ANSWER

                                                                                        I.          BACKGROUND

The complaint, filed on September 21, 2022, alleges that pursuant to an oral agreement, Plaintiffs and Defendant agreed to buy real property together, to share title and expenses equally, and to split profits if the house was sold. Because of Plaintiffs’ difficulties, only Defendant was placed on title to the home. Defendant now claims to be the sole owner. Plaintiffs allege claims for partition, accounting, breach of contract, breach of the implied covenant of good faith and fair dealing, fraud, constructive trust, and declaratory relief.

                                                                                        II.          ARGUMENTS

Defendant moves to amend the answer to allege affirmative defenses which have become necessary based on written discovery obtained from Plaintiffs. The amended pleading will also narrow and clarify the issues. Plaintiffs will not suffer prejudice from the amended answer.

Plaintiffs request an order awarding sanctions against Defendant under Code Civ. Proc., § 128.5 because the motion is frivolous.  It has been over one year since Defendant filed his answer. Defendant has not explained the delay. Plaintiffs will suffer prejudice because discovery is complete. The amended answer will require Plaintiffs to engage in further discovery and cause a trial delay. The evidence does not substantiate the absence of an agreement to sell the property as Defendant proposes to add in the amended answer.

In reply, Defendant argues that where it appears that amendment is necessary, the court may postpone trial. Plaintiffs have not shown that Defendant intentionally engaged in dilatory litigation.

                                                                              III.          LEGAL STANDARDS

      The court can permit amendment of any pleading on any terms and “in other particulars” as may be proper.” (Code Civ. Proc., § 473(a).) The court’s discretion will usually be exercised liberally to permit amendment of the pleadings. (Nestle v. City of Santa Monica (1972) 6 Cal.3d 920, 939.) If the motion is timely made, and the granting of the motion will not result in prejudice to the opposing party, it is error to refuse permission to amend. (Morgan v. Superior Court of Cal. In and For Los Angeles County (1959) 172 Cal.App.2d 527, 530 ["… it is error to refuse permission to amend and where the refusal also results in a party being deprived of the right to assert a meritorious cause of action or a meritorious defense, it is not only error but an abuse of discretion.”].) Amendments are liberally permitted up to the date of trial or during trial where no prejudice is shown. (Atkinson v. Elk Corp. (2003) 109 Cal.App.4th 739, 761.)

      Whether an amendment should be allowed “rests in the sound discretion of the trial court. [Citations.] And courts are much more critical of proposed amendments to answers when offered after long unexplained delay or on the eve of trial [citations], or where there is a lack of diligence, or there is prejudice to the other party (citations).” (Hulsey v. Koehler (1990) 218 Cal.App.3d 1150, 1159.)

                                                                                       IV.          DISCUSSION

      While Plaintiff argues that the evidence does not substantiate the proposed amendments, the court does not consider the validity of the amendments at this stage. The “better course is to allow a plaintiff to amend the complaint and then let the parties test its legal sufficiency in other appropriate proceedings.” (Brown v. Ralphs Grocery Co. (2018) 28 Cal.App.5th 824, 843.) Nor may a court condition leave to amend on production of admissible evidence substantiating the allegations of the amended pleading. (Sanai v. Saltz (2009) 170 Cal.App.4th 746, 770.)

      Defendant has shown diligence and reason for the delay in amending the answer which was predicated upon receipt of responses to discovery which is ongoing. (Robert Krasney decl., ¶¶ 14-15.) Plaintiffs contend that they will suffer prejudice because they are required to incur additional costs for discovery pertaining to the new affirmative defenses. Defendant contends the amendments will assert dispositive defenses and narrow the issues. Thus, the only “true” prejudice to Plaintiffs is that they will “now have to go back and try the case on the merits. But since the law strongly favors trial and disposition on the merits, there is no prejudice." (Rogalski v. Nabers Cadillac (1992) 11 Cal.App.4th 816, 822.)

      Trial is presently set for November 20, 2024. Plaintiffs have not explained what lengthy discovery is required that cannot be completed before the trial date. To the extent discovery cannot be completed prior to trial, any party may move the court for leave to continue trial and discovery as necessary.

      Plaintiffs have not shown that the motion is frivolous and requires imposition of sanctions. A court has discretion to award reasonable expenses including attorney’s fees incurred as a result of "actions or tactics, made in bad faith, that are frivolous or solely intended to cause unnecessary delay." (Code Civ. Proc., § 128.5 subd. (a).) “Frivolous” actions or tactics means "totally and completely without merit or for the sole purpose of harassing an opposing party." (Code Civ. Proc., § 128.5 subd. (b)(1) and (2).)

      The moving party’s burden is to establish that the action or tactic was "(1) totally and completely without merit, measured by the objective, ‘reasonable attorney’ standard, or (2) motivated solely by an intention to harass or cause unnecessary delay, measured by a subjective standard. [Citations.] Whether sanctions are warranted depends on an evaluation of all the circumstances surrounding the questioned action.” (Wallis v. PHL Associates, Inc. (2008) 168 Cal.App.4th 882, 893.)

      Plaintiffs’ request for imposition of sanctions under Section 128.5 is procedurally defective in that the motion is required to be filed separately from other motions or requests. (Code Civ. Proc., § 128.5 subd. (f)(2)(a).) Secondly, since Plaintiffs contend that filing the motion was frivolous, Plaintiffs must comply with the 21-day safe harbor provision which applies where the “action or tactic” is the filing of a motion or pleading that is frivolous and without merit. First, the ‘moving party must serve on the offending party a motion for sanctions.’ (Ibid.) Service of the sanctions motion triggers the 21-day safe harbor period during which the moving party may not file the motion. (Ibid.) That is because the offending party may avoid sanctions by withdrawing the challenged pleading during the 21-day period. (Ibid.) Second, if the offending party does not withdraw the challenged pleading during that period, then the moving party may file the sanctions motion.” (Id.) Strict compliance with the safe harbor provision is required, and failing to comply precludes an award of sanctions. (Id. at 551.)

                                                                                        V.     CONCLUSION

    Based on the foregoing, Defendant’s motion for leave to file an amended answer is GRANTED. Defendant is ordered to file and serve its first amended answer forthwith.  Plaintiffs’ request for imposition of sanctions is DENIED.