Judge: Peter A. Hernandez, Case: 22PSCV00103, Date: 2023-10-09 Tentative Ruling

Case Number: 22PSCV00103    Hearing Date: November 13, 2023    Dept: K

Defendants John JoonHyo Shin and Sue SeungOk Shin, individually and as co-trustees of The Joon Hyo Shin Family Trust’s unopposed Motion for Leave to File Cross-Complaint is GRANTED.

Background[1]  

Plaintiff Mickey’s Liquor & Market Inc. (“Plaintiff”) alleges as follows:

Plaintiff is the current tenant of a commercial property located at 13512 East Valley Boulevard, La Puente, CA 91746 (“Premises”) via the May 2012 assignment/amendment (“2012 Amendment”) of a 2006 lease (“2006 Lease”); Joon Hyo Shin and Seung Ok Shin are the landlords and co-trustees of the Joon Hyo Shin Family Trust dated May 20, 2003, which is the actual owner of the Premises. The 2012 Amendment extended the lease term to June 5, 2022 and provided Plaintiff with a right to exercise an option to further extend the lease term for 5 more years provided Plaintiff was in compliance with its obligations at the time of the exercise. Plaintiff exercised this option via a notice dated November 16, 2021, but it was denied.

On January 31, 2022, Plaintiff filed a complaint, asserting causes of action against Joon Hyo Shin and Seung Ok Shin, individually and as co-trustees of The Joon Hyo Shin Family Trust dated May 20, 2003 and Does 1-10 for:

1.                  Declaratory Relief

2.                  Breach of Lease

3.                  Breach of Covenant of Quiet Enjoyment

4.                  Fraud (Deceit/False Promise)

5.                  Breach of Statute

The Final Status Conference is set for December 12, 2023. Trial is set for January 16, 2024.

Legal Standard

“A party against whom a cause of action has been asserted in a complaint or cross-complaint may file a cross-complaint setting forth. . . : (a) Any cause of action he has against any of the parties who filed the complaint or cross-complaint against him…” (Code Civ. Proc. § 428.10, subd. (a).) “A party shall file a cross-complaint against any of the parties who filed the complaint or cross-complaint against him or her before or at the same time as the answer to the complaint or cross-complaint.” (Code Civ. Proc. § 428.50, subd. (a).)

“Except as otherwise provided by statute, if a party against whom a complaint has been filed and served fails to allege in a cross-complaint any related cause of action which (at the time of serving his answer to the complaint) he has against the plaintiff, such party may not thereafter in any other action assert against the plaintiff the related cause of action not pleaded.” (Code Civ. Proc. § 426.30, subd. (a).) A “‘[r]elated cause of action’ means a cause of action which arises out of the same transaction, occurrence, or series of transactions or occurrences as the cause of action which the plaintiff alleges in his complaint.” (Code Civ. Proc. § 426.10, subd. (c).)

“A party who fails to plead a cause of action subject to the requirements of this article, whether through oversight, inadvertence, mistake, neglect, or other cause, may apply to the court for leave to amend his pleading, or to file a cross-complaint, to assert such cause at any time during the course of the action. The court, after notice to the adverse party, shall grant, upon such terms as may be just to the parties, leave to amend the pleading, or to file the cross-complaint, to assert such cause if the party who failed to plead the cause acted in good faith. This subdivision shall be liberally construed to avoid forfeiture of causes of action.” (Code Civ. Proc. § 426.50(a).)

Discussion

Defendants John JoonHyo Shin and Sue SeungOk Shin, individually and as co-trustees of The Joon Hyo Shin Family Trust (“Defendants”) move the court for an order granting them leave to file a proposed cross-complaint.

The proposed cross-complaint is compulsory, inasmuch as it is asserted against Plaintiff and involves a “related cause of action” as defined by Code of Civil Procedure § 426.10, subdivision (c). Causes of action arise out of the “same transaction or occurrence” if there is “a logical relationship between the prior complaint and the cross-complaint.” (ZF Micro Devices, Inc. v. TAT Capital Partners, Ltd. (2016) 5 Cal.App.5^th 69, 82). The term “transaction” “is construed broadly; it is not confined to a single, isolated act or occurrence. . . but may embrace a series of acts or occurrences logically interrelated.” (Heshejin v. Rostami (2020) 54 Cal.App.5th 984, 993-994 [internal quotations and citation omitted].) “In the breach of contract context, the rule means any claims the defendant has against the plaintiff based on the same contract generally must be asserted in a cross-complaint, even if the claims are unrelated to the specific breach or breaches that underlie the plaintiff's complaint.” (Id. at 994 [quotations and citation omitted].)

Plaintiff’s complaint and the proposed cross-complaint both pertain to the commercial lease agreement for Plaintiff’s tenancy at the subject property.

The question remaining, then, is whether or not Defendants have acted in good faith. “The provision in section 425.60 relating to ‘good faith’ does allow trial courts a ‘modicum of discretion’ in allowing amendments to cross-complaints. Nonetheless, what constitutes ‘good faith’ must be determined in conformity with the liberality conferred upon the trial courts by the section and by prior law.” (Sidney v. Superior Court (1988) 198 Cal.App.3d 710, 718.) “[T]his principle of liberality requires that a strong showing of bad faith be made in order to support a denial of the right to file a cross-complaint under this section.” (Id. [quotations and citation omitted].)

There is no evidence that Defendants have acted in bad faith; in fact, the motion is not opposed. The motion, then, is granted.