Judge Michelle Williams Court, Case Number: 23STCV27046, Date: 2024-03-28 Tentative Ruling

Judge: Michelle Williams Court, Case: 23STCV27046, Date: 2024-03-28 Tentative Ruling

Case Number: 23STCV27046 Hearing Date: March 28, 2024 Dept: 1

23STCV27046 METROPOLIS MASTER ASSOCIATIATION vs OLEG PARISER

Defendant’s Motion to Submit Petition for Coordination

TENTATIVE RULING: Defendant Pariser’s Motion to Submit Petition for Coordination is GRANTED. The Court shall sign the provided proposed order. Clerk to give notice.

Background of Los Angeles Superior Court Cases 23STCV27046 and 23STSC04388

On November 3, 2023, Metropolis Master Association filed 23STCV27046 against Oleg Pariser seeking validation of the election of its corporate officers and declaratory relief.

Metropolis Master Association alleges it is “a mix-used master planned community consisting of a hotel, three high rise condominium buildings, approximately 32 commercial condominiums, Master Association Property, and a total of approximately 1,555 residential condominiums to be governed by three condominium associations.” (Compl. ¶ 4.) All units are allegedly subject to a Master Declaration of Covenants, Conditions, and Restrictions as well as the Bylaws and the Election and Voting Rules. (Id. ¶ 5.) Metropolis Master Association alleges Pariser challenged the September 2022 election of the Association’s Board of Directors, and all prior elections, by arguing “the elections have been conducted in violation of California Code of Regulations Title 10, Section 2792.19.” Metropolis Master Association notes Pariser filed a small claims complaint in Los Angeles Superior Court case 23STSC04388, “seeking declaratory and equitable relief pursuant to Civil Code 5145.” (Id. ¶ 8.) Metropolis Master Association requests the court adjudicate the validity of the September 2022 election under Corporations Code section 7616 and confirm that the Association’s governing documents regarding election rules are valid and enforceable.

On January 29, 2024, Judge Richard L. Fruin issued an order finding this action related to small claims case 23STSC04388 Pariser v. Metropolis Master Association. In the small claims case, Pariser alleged the Association failed to follow its election rules because the Association’s developer, Greenland, was not current in its payment of regular and special assessments and the elections violated California Code of Regulations Title 10, Section 2792.19(c)(1) because Greenland’s membership votes elected all of three directors up for election. The court entered judgment in the small claims action against Metropolis Master Association, which it appealed.

On February 20, 2024, Judge Fruin issued an order stating “[t]his case is hereby determined to be complex within the meaning of rule 3.400 of the California Rules of Court.”

On March 18, 2024, the Court denied Pariser’s motion for leave to file a cross-complaint.

Background of Orange County Case 30-2023-01346055-CU-NP-CJC

On August 28, 2023, Greenland LA Metropolis Development I, LLC and Greenland LA Metropolis Development I-A, LLC (collectively “Greenland”) filed a civil action against Metropolis I Condominium Owners’ Association (“Met I Association”), Meredith Spira, Oleg Pariser, Jacinta Tian, and Matt Ragusano in Orange County Superior Court case 30-2023-01346055-CU-NP-CJC. The complaint asserted causes of action for: (1) violation of the CC&RS – Civil Code § 5975;(2) breach of fiduciary duty; (3) declaratory relief; (4) removal of director (Cal. Corp. Code § 7223); (5) violation of Corp. Code Section 8333, et seq.; and (6) breach of implied covenant of good faith and fair dealing.

The complaint alleges Greenland owns fifty residential units and two retail units within one of the towers of the Metropolis development in downtown Los Angeles. Defendant Met I Association, and its directors, Defendants Meredith Spira, Oleg Pariser, Jacinta Tian, and Matt Ragusano, allegedly filed a Demand for Arbitration against Plaintiff Greenland LA Metropolis Development I seeking millions of dollars in alleged unpaid assessments and asserted the unpaid assessments were grounds to disqualify Greenland’s representative from serving on the board of directors on August 8, 2023. Greenland also alleges Met I Association failed to issue annual reports as required and refused to provide Greenland with information regarding legal and financial matters. The complaint seeks a determination that Greenland does not owe any amount to Met I Association, that the disqualification of its representative was improper, that the election is void, and the removal of Defendants Spira, Pariser, Tian, and Ragusano as directors of Met I Association.

On November 1, 2023, Met I Association and Pariser filed a cross-complaint against Greenland, Greenland LA Metropolis Acquisition, LLC, and Metropolis Master Association. The cross-complaint asserts causes of action for: (1) breach of covenant; (2) breach of fiduciary duty; (3) declaratory relief; (4) accounting; and (5) negligence. The cross-complaint alleges Greenland failed to pay assessments on its units to Met I Association beginning on April 1, 2017 based upon a purported Abatement Agreement, which the parties failed to provide to the Department of Real Estate. Metropolis Master Association and Greenland also allegedly failed to establish and manage Cost Centers as required by the applicable CC&Rs. Met I Association alleges it faces a significant financial shortfall and seeks to enforce the assessment obligations, declare the Abatement Agreement void, and obtain a judicial declaration of its right to foreclose on its assessment liens. Pariser also seeks to enforce his right to financial records of Metropolis Master Association.

Request for Judicial Notice

On February 27, 2024, Defendant Pariser filed a request for judicial notice and a supplemental request for judicial notice, both seeking judicial notice of the February 20, 2024 minute order in 23STCV27046. On March 21, 2024, Defendant Pariser filed a request for judicial notice of the January 2, 2024 minute order in 23STSC04388. The requests are GRANTED. (Evid. Code § 452(d).)

Motion for Leave to Submit Petition for Coordination

Standard

Code of Civil Procedure section 404 provides: “[w]hen civil actions sharing a common question of fact or law are pending in different courts, a petition for coordination may be submitted to the Chairperson of the Judicial Council, by the presiding judge of any such court, or by any party to one of the actions after obtaining permission from the presiding judge, or by all of the parties plaintiff or defendant in any such action. . . . a motion for permission to submit a petition, shall be supported by a declaration stating facts showing that the actions are complex, as defined by the Judicial Council and that the actions meet the standards specified in Section 404.1.” (See also Cal. R. Ct., rule 3.520(b)(1) (“If a direct petition is not authorized by Code of Civil Procedure section 404, a party may request permission from the presiding judge of the court in which one of the included actions is pending to submit a petition for coordination to the Chair of the Judicial Council.”).) In Los Angeles Superior Court, the presiding judge has designated the supervising judge of the civil division (who sits in Dept. 1) to exercise this authority and responsibility. (Code Civ. Proc. § 404.9.)

Defendant’s Motion Satisfies the Applicable Procedural Requirements

A motion seeking permission to submit a petition for coordination “must specify the matters required by rule 3.521(a) and must be made in the manner provided by law for motions in civil actions generally.” (Cal. R. Ct., rule 3.520(a).) Rule 3.521(a) requires the submission of “memorandum and declarations showing:

(1) The name of each petitioner or, when the petition is submitted by a presiding or sole judge, the name of each real party in interest, and the name and address of each party's attorney of record, if any;

(2) The names of the parties to all included actions, and the name and address of each party's attorney of record, if any;

(3) If the party seeking to submit a petition for coordination is a plaintiff, whether the party's attorney has served the summons and complaint on all parties in all included actions in which the attorney has appeared;

(4) For each included action, the complete title and case number, the date the complaint was filed, and the title of the court in which the action is pending;

(5) The complete title and case number of any other action known to the petitioner to be pending in a court of this state that shares a common question of fact or law with the included actions, and a statement of the reasons for not including the other action in the petition for coordination or a statement that the petitioner knows of no other actions sharing a common question of fact or law;

(6) The status of each included action, including the status of any pretrial or discovery motions or orders in that action, if known to petitioner;

(7) The facts relied on to show that each included action meets the coordination standards specified in Code of Civil Procedure section 404.1; and

(8) The facts relied on in support of a request that a particular site or sites be selected for a hearing on the petition for coordination.

(Cal. R. Ct., rule 3.521(a).) Defendant Pariser’s motion is accompanied by the proposed petition for coordination, which includes the information required by Rule 3.521(a) and Code of Civil Procedure section 404. (Rogers Decl. Ex. B, Feb. 27 RJN Ex. A.)

The motion also must be “accompanied by a proposed order. The proposed order must state that the moving party has permission to submit a petition for coordination to the Chair of the Judicial Council under rules 3.521-3.523.” (Cal. R. Ct., rule 3.520(b)(1).) On February 27, 2024, Defendant Pariser submitted the required proposed order. (Cal. R. Ct., rule 3.520(b)(1).) Because the other parties do not agree to the filing of a petition for coordination, Defendant Pariser was required to bring a motion for permission. (Code Civ. Proc. § 404.)

Defendant Pariser Demonstrated a Common Issue of Fact or Law

“Coordination may be requested when civil actions sharing a common question of fact or law are pending in different courts.” (Keenan v. Superior Court (1980) 111 Cal.App.3d 336, 340.) Defendant Pariser argues “the dispositive issue in each action stems from the enforceability of the Illegal Abatement Agreements entered into at the direction of Greenland as that issue determines whether: (a) Met Master had a duty to disqualify Greenland candidates; (b) Met I correctly disqualified Greenland candidates; (c) Greenland owes millions of dollars in unpaid assessments; and (d) Greenland directors violated their fiduciary duties to both non-profit community associations and their respective membership as a whole.” (Mot. at 8:14-19.) In reply, Pariser reiterates the cases “share common questions of fact and law as to Greenland’s improper control of both associations, the legality of abatement agreements, the factual circumstances that resulted in abatement agreements, Greenland’s failure to pay assessments due and owing to Met I and Met I’s failure to pay Greenland’s share of assessments to Met Master at Greenland’s direction and control. . . all raise common questions of law as to the enforceability of abatement agreements . . . [and] the disqualification of directors in common interest development elections.” (Reply at 3:9-4:1.)

In opposition, the Greenland parties argue against the ultimate coordination of the cases, citing Code of Civil Procedure section 404.1. The Greenland parties also argue Orange County is the proper venue for the claims asserted in that action, which Pariser contests. (Greenland Opp. at 6:1-12; Reply at 4:8-5:7.) However, these arguments are not properly before the Court on Pariser’s motion herein. Similarly, Metropolis Master Association’s joinder primarily relies upon Section 404.1. While the motion must include information relevant to Section 404.1, this Court does not determine the ultimate issue of whether the cases should be coordinated. (Code Civ. Proc. § 404.) The only requirement to submit a petition for coordination of cases deemed complex, (Feb. 27 RJN Ex. A), is to demonstrate there are “civil actions sharing a common question of fact or law are pending in different courts.” (Ibid.)

In addressing this requirement, the Greenland parties contend “the three actions at issue do not share a common question of fact or law, nor is there is a risk as to inconsistent rulings, as the matters involve different entities, different assessments, different abatements, and therefore different analyses.” (Greenland Opp. at 4:26-5:21.) Pariser’s argument in reply regarding Greenland’s standing to oppose the motion, (Reply at 5:8-6:10), lacks merit as Greenland are parties to litigation encompassed within the proposed petition. In the joinder, Metropolis Master Association summarily contends “the Orange County action involves a dispute regarding the election for the Board of Directors for Metropolis I Condominium Owners’ Association (‘Met I Association’), which is a completely separate entity from the Metropolis Master Association” and therefore the cases “do not share a common question of fact or law.” (Joinder at 3:6-12.)

In 23STCV27046, Metropolis Master Association seeks an adjudication of the parties’ rights regarding the election of the board of directors and challenges related thereto, citing Pariser’s filing of the small claims complaint in 23STSC04388. The small claims complaint specifically alleged “[p]er Defendant’s Master Election Rules adopted 02/28/2022 Section IV.B.1, a Candidate or Director must be current in the payment of regular and special assessments. Defendant’s developer, Greenland is not current in its payment of regular and special assessments.” In 30-2023-01346055-CU-NP-CJC, Greenland LA Metropolis Development I LLC, a Delaware and Greenland LA Metropolis Development I-A, LLC seek a judicial declaration that they are current on all assessments and Pariser argues they are not current and the abatement agreements relied upon by Greenland are void. The Court agrees with Pariser that the cases share common questions of law and fact and therefore meet “the threshold standard set forth in section 404.” (Keenan, supra, 111 Cal.App.3d at 342.)

Accordingly, the motion is GRANTED. Los Angeles Superior Court cases 23STCV27046 and 23STSC04388 are stayed for 30 days. (Cal. R. Ct, rule 3.520(b)(3) (“To provide sufficient time for a party to submit a petition, the presiding judge may stay all related actions pending in that court for a reasonable time not to exceed 30 calendar days.”).)