Judge Peter A. Hernandez, Case Number: 20PSCV00334, Date: 2023-09-05 Tentative Ruling

Defendant Tracy Lenhart’s Motion for Summary Judgment or, in the Alternative, Summary Adjudication is DENIED in full.

Plaintiff Jennifer Buckley, Trustee of the Frank Raymond Restivo Revocable Trust Dated May 2010 (“Plaintiff”) alleges as follows:

Frank Restivo (“Frank”), Plaintiff’s father, became good friends with Defendants Leroy Lenhart (“Leroy”) and Tracy Lenhart (“Tracy”), both dba Covina Coin (together, “the Lenharts”). Over the course of 11 years, and pursuant to a verbal agreement, Frank loaned the Lenharts over $800,000.00. Frank died on July 19, 2019. The Lenharts still owed Frank $537,720.00 as of the date of Frank’s death, including $277,115.00 remaining in uncashed checks.

On October 30, 2023, Plaintiff filed a First Amended Complaint, asserting causes of action against the Lenharts and Does 1-20 for:

The Final Status Conference is set for January 23, 2024. Trial is set for February 6, 2024

The purpose of a motion for summary judgment or summary adjudication “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.) “Code of Civil Procedure section 437c, subdivision (c), requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119 [emphasis omitted].)

“On a motion for summary judgment, the initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D.B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1519.) A defendant moving for summary judgment or summary adjudication “has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action . . . cannot be established, or that there is a complete defense to the cause of action.” (Code Civ. Proc., § 437c, subd. (p)(2).) “Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437, subd. (p)(2).) “If the plaintiff cannot do so, summary judgment should be granted.” (Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal.App.4^th 463, 467.)

“When deciding whether to grant summary judgment, the court must consider all of the evidence set forth in the papers (except evidence to which the court has sustained an objection), as well as all reasonable inferences that may be drawn from that evidence, in the light most favorable to the party opposing summary judgment.” (Id. at 467; Code Civ. Proc., § 437c, subd. (c).)

Tracy moves the court for summary judgment in her favor and against Plaintiff; in the alternative, Tracy seeks summary adjudication of the following issues:

Issue #1: Plaintiff’s first cause of action (i.e., for Breach of Oral Contract) fails, because Plaintiff cannot point to any admissible evidence establishing an oral agreement or any other elements of an oral contract, such as mutual assent, breach, causation or damages. Plaintiff’s claim is also barred by the Statute of Frauds and statute of limitations.

Issue #2: Plaintiff’s second cause of action (i.e., for Open Book Account) fails, because Plaintiff cannot point to any admissible evidence establishing an agreement for an open book account. Plaintiff’s claim is also barred by the Statute of Frauds and statute of limitations.

Issue #3: Plaintiff’s third cause of action (i.e., for Account Stated) fails, because Plaintiff cannot point to any admissible evidence establishing that Plaintiff and Tracy agreed on a final amount due. Plaintiff’s claim is also barred by the Statute of Frauds and statute of limitations.

Issue #4: Plaintiff’s fourth cause of action (i.e., for Promissory Estoppel) fails, because Plaintiff cannot point to any admissible evidence establishing that Plaintiff made any representations, that there was reliance and harm. Plaintiff’s claim is also barred by the Statute of Frauds and statute of limitations.

Issue #6: Plaintiff’s sixth cause of action (i.e., for Breach of Written Contract) fails, because Plaintiff cannot point to any admissible evidence establishing that Tracy entered into an agreement or that the Commercial Code subsumes contract law and imposes contract law on checks in that checks are not promises; breach, causation or damages. Plaintiff’s claim is also barred by the Statute of Frauds and statute of limitations.

At the outset, the court notes that on October 11, 2023, a “Stipulation [and Order] for Leave to File First Amended Complaint and Attendant Discovery” was entered. The instant motion was filed on October 24, 2023. Plaintiff’s FAC was not filed until October 30, 2023. “Because there is but one complaint in a civil action, the filing of an amended complaint moots a motion directed to a prior complaint.” (State Compensation Ins. Fund v. Superior Court (2010) 184 Cal.App.4th 1124, 1131). However, although this instant motion was filed when the original complaint was the operative pleading and before the FAC was filed, the instant motion contemplated the filing of the FAC and addressed Plaintiff’s cause of action for “Breach of Written Contract (Negotiable Instruments)” which was added via the FAC.

Tracy’s alternate request for summary adjudication is deficient. Code of Civil Procedure § 437, subdivision (f)(1) states that “[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. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.” (Emphasis added).

California Rules of Court (“CRC”) Rule 3.1350, subdivision (b) provides that “[i]f summary adjudication is sought, . . . , the specific cause of action, affirmative defense, claims for damages, or issues of duty must be stated specifically in the notice of motion and be repeated, verbatim, in the separate statement of undisputed material facts.” (Emphasis added). Subdivision (d) provides that “[t]he separate Statement of Undisputed Material Facts in support of a motion must separately identify: (A) Each cause of action, claim for damages, issue of duty, or affirmative defense that is the subject of the motion; and (B) Each supporting material fact claimed to be without dispute with respect to the cause of action, claim for damages, issue of duty, or affirmative defense that is the subject of the motion.” (Emphasis added). Tracy improperly seeks summary adjudication of specific causes of action and affirmative defenses within the same framed “issue” (i.e., for instance, Issue #1 seeks summary adjudication of the first cause of action for Breach of Oral Contract and of the affirmative defenses of Statute of Frauds and statute of limitations). Tracy’s separate statement, moreover, fails to address each of the causes of action and affirmative defenses separately; in fact, it does not appear that the statute of frauds and/or statute of limitations are referenced whatsoever therein. The court will treat the instant motion as one for summary judgment only.

Further, Plaintiff’s moving separate statement fails to comply with Code of Civil Procedure § 437c, subdivision (b)(1) (the separate statement must set forth “plainly and concisely all material facts that the moving party contends are undisputed”). (See Reeves v. Safeway Stores, Inc. (2004) 121 Cal.App.4th 95, 105-106 [“[D]efendant asserts ‘undisputed facts’ in terms not of relevant events but of what a witness has said about events. . . It seems indisputably true that Brian Sparks so testified in deposition. . . [b]ut what Sparks. . . might have said in deposition is not, as such, a ‘material fact.’ It is of interest only as evidence of a material fact, e.g., that plaintiff made a damaging admission about his confrontation with Juarez. . .”].)

Plaintiff’s “Response to Defendant’s Separate Statement of Facts” and “Defendant’s Response to Plaintiff’s Separate Statement of Additional Material Facts in Dispute” both impermissibly include evidentiary objections. “[A] separate statement is not evidence; it refers to evidence submitted in support of or opposition to a summary judgment motion. (Jackson v. County of Los Angeles (1997) 60 Cal.App.4th 171, 178, fn. 4 [emphasis theirs].) The parties’ evidentiary objections contained therein are summarily overruled on this basis.

Further, Tracy’s moving papers reflect non-compliance with CRC Rule 3.1116(c) (i.e., “[t]he relevant portion of any testimony in the deposition must be marked in a manner that calls attention to the testimony”).

The court declines to rule on Defendant’s “Objections to Evidence[, etc].” as unnecessary to the disposition of the motion. (See Code Civ. Proc., § 437c, subdivision (q).)

First, the court notes that Tracy’s motion repeatedly cites to unpublished/noncitable opinions (i.e., Setareh v. Elyaszaseh, 2020 WL 3467840; Rolfe v. Bohannon, 2002 WL 31341627; and Sweringer v. Humenik, 2016 WL 1601857 and Mejia v. Bank of America, N.A., 2016 WL 1752958). CRC Rule 8.1115, subdivision (a) provides that “[e]xcept as provided in (b)[1], an opinion of a California Court of Appeal or superior court appellate division that is not certified for publication or ordered published must not be cited or relied on by a court or a party in any other action.” The court admonishes counsel for Tracy and declines to consider same.

On October 30, 2023, Plaintiff filed a FAC against Tracy, Leroy[2] (together, the “Lenharts”) and Does 1-20 for Breach of Oral Contract, Open Book Account, Account Stated, Promissory Estoppel, Unjust Enrichment and Breach of Written Contract (Negotiable Instruments).

Plaintiff became the successor trustee of her father, Frank Restivo’s (“Frank”) trust upon his July 19, 2019 death and is the sole successor trustee. (FAC, ¶ 1). The Lenharts are doing business as Covina Coin located in Covina, California. (Id., ¶ 2). Frank and the Lenharts met in approximately 2008 and became good friends. (Id., ¶ 7). Having an interest in rare coins, Frank would often visit the Lenharts at their coin shop in Covina to chat with them and discuss the coins in stock. (Id.) The Lenharts came to know that Frank willingly lent money to friends in need, particularly to help keep their businesses running. (Id., ¶ 8).

On or about October 2007, the Lenharts approached Frank and asked that Frank lend them money for personal and business reasons. (Id., ¶ 9). Frank agreed and lent the Lenharts $60,000.00 on October 15, 2007. (Id.) The Lenharts verbally agreed to begin repaying Frank on a monthly basis as soon as possible, but no later than six years after the funds had been lent. (Id.)

Frank ultimately lent the Lenharts approximately $812,000.00 between October 2007 and November 2018. (Id., ¶ 10). At some point, Frank began maintaining a handwritten ledger of the amounts lent to the Lenharts and the amounts that had been paid. (Id.) The Lenharts did not begin repaying any amounts until August 15, 2012, when they repaid $2,000.00. (Id.) As of November 13, 2018, Frank was still owed $535,720.00. (Id.) The Lenharts repeatedly verbally agreed to repay the loans on a monthly basis and in full when they were able to do so. (Id., ¶ 11). In about 2016, the Lenharts started writing and signing post-dated checks to Frank, which Frank then held and cashed on a weekly or monthly basis. (Id.)

Starting in 2017 the Lenharts often did not have sufficient funds to pay the checks they had written, so Frank ended up holding dated checks for a long period of time before cashing them. (Id.) In approximately 2018, Frank went to the bank to deposit a check Leroy had signed and the bank indicated the checks were starting to be too old and would soon be stale dated. (Id., ¶ 12). As a result, the Lenharts began writing and signing checks and omitting the date so Frank could fill in the date when the check was going to be negotiated. (Id.) On November 9, 2018, Frank wrote his last check to Covina Coin for a further loan, in the amount of $9,000.00. (Id., ¶ 15). Later in November 2018, a check from the Lenharts bounced for the first time; that month, the Lenharts stopped making repayments to Frank. (Id.) Frank did not deposit any further checks after November 2018 because the Lenharts had insufficient funds in their account. (Id.) After the first check bounced in November 2018, Frank spoke with his children, including Plaintiff, about the loans to the Lenharts and Covina Coin and advised them, inter alia, that the Lenharts still owed him close to $600,000.00. (Id., ¶ 16). After Frank’s death, Plaintiff located Frank’s accounting ledger, as well as the stack of uncashed checks from the Lenharts. (Id., ¶ 17). On December 19, 2019, Plaintiff’s counsel sent a demand for repayment to Leroy and proposed that Plaintiff begin negotiating the uncashed signed checks which totaled $277,115.00. (Id., ¶ 18). Leroy disputed the amount owed. (Id., ¶ 19).

The elements of a breach of contract cause of action are the “(1) existence of the contract; (2) plaintiff's performance or excuse for nonperformance; (3) defendant's breach; and (4) damages to plaintiff as a result of the breach.” (Aton Center, Inc. v. United Healthcare Ins. Co. (2023) 93 Cal.App.5th 1214, 1230.) The elements of a book account include: 1) a detailed statement which constitutes the principal record of one or more transactions between a debtor and a creditor; 2) that arises out of a contract or some fiduciary relation; 3) that shows the debts and credits against whom and in favor of whom; 4) that is entered in the regular course of business; 6) that is kept in a reasonably permanent form or manner; and 7) that is in a bound book or on a sheet or sheets fastened in a book or to backing but detachable therefrom or on a card or cards of a permanent character or is kept in any other reasonably permanent form and manner. (Code Civ. Proc., § 337a).

"The essential elements of an account stated are: (1) previous transactions between the parties establishing the relationship of debtor and creditor; (2) an agreement between the parties, express or implied, on the amount due from the debtor to the creditor; (3) a promise by the debtor, express or implied, to pay the amount due.” (Zinn v. Fred R. Bright Co. (1969) 271 Cal.App.2d 597, 600). “The elements of a promissory estoppel claim are (1) a promise clear and unambiguous in its terms; (2) reliance by the party to whom the promise is made; (3)[the] reliance must be both reasonable and foreseeable; and (4) the party asserting the estoppel must be injured by his reliance.” (Aceves v. U.S. Bank, N.A. (2011) 192 Cal.App.4th 218, 225 [citation and internal quotations omitted].) Finally, unjust enrichment is a “general principle, underlying various legal doctrines and remedies,” and is “synonymous with restitution.” (Melchior v. New Line Productions, Inc. (2003) 106 Cal.App.4th 779, 793 [citation and internal quotations omitted].)

Tracy has proffered the following evidence in support of her motion for summary judgment:

Leroy died on April 13, 2021. (Defendants’ Undisputed Material Fact [“DUMF”] No. 1). Plaintiff knows of at least 4-5 individuals to whom Frank extended credit. (DUMF No. 2). From October 2007-November 2018, the period during which Plaintiff alleges Frank extended credited [sic], “Covina Coin” was a fictious name (‘DBA’) solely registered under Leroy Lenhart. (DUMF No. 3). No other person other than Frank was involved in keeping the handwritten ledger. (DUMF No. 4). Plaintiff does not know how often the handwritten ledger was updated. (DUMF No. 5). Plaintiff does not know when the handwritten ledger was last updated. (DUMF No. 6). Plaintiff admits that Plaintiff has no written agreements relating to money loaned to Defendant (or Leroy). (DUMF No. 7). Plaintiff admits that she does not know whether the undated checks in Frank’s possession at the time of his death were to replace dated checks. (DUMF No. 8). Plaintiff admits that Frank never told her that Tracy agreed to repay him moneys loaned. (DUMF No. 9). The sole reason Plaintiff believes that the checks in Frank Restivo’s possession at the time of his death related to a loan was because Frank Restivo allegedly told her that. (DUMF No. 10).

The foregoing material facts proffered by Tracy are insufficient to shift Tracy’s moving burden, inasmuch as they do not show that one or more elements of each of Plaintiff’s causes of action cannot be established or that there is a complete defense to the causes of action.

[1] Subdivision (b) is not applicable; it reads that “[a]n unpublished opinion may be cited or relied on: (1) When the opinion is relevant under the doctrines of law of the case, res judicata, or collateral estoppel; or (2) When the opinion is relevant to a criminal or disciplinary action because it states reasons for a decision affecting the same defendant or respondent in another such action.”

[2] Leroy was dismissed from the action, with prejudice, on April 22, 2022. The dismissal indicates that he is “now deceased.”