Judge: Rafael A. Ongkeko, Case: SC125743, Date: 2023-04-07 Tentative Ruling

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Case Number: SC125743    Hearing Date: April 7, 2023    Dept: D

SUPERIOR COURT OF THE STATE OF CALIFORNIA

COUNTY OF LOS ANGELES

Matters:  

1.      Defendant Tisha Bennett’s motion to determine that Bennett is the prevailing party and to award and fix the reasonable amount of attorneys’ fees (filed 2/1/23);

2.      Plaintiff’s Motion to strike and tax costs sought by Defendant Bennett (filed 2/21/23).

Counsel for plaintiff TERESIJA SIGMUND:  Sarvenaz Bahar (Limited Scope).
Counsel for defendant TISHA BENNETT: Roy Koletsky and Kristyn Mintesnot of Koletsky, Mancini, Feldman & Morrow, LLP.

Other counsel:  Omitted.

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(Tentative) RULINGS

Re Bennett’s motion:  Prevailing party status under the CC&Rs and Civil Code § 5975 is DENIED; attorneys’ fees are DENIED.  Evidentiary ruling:  Plaintiff’s objections to Exhibits A and B of the Reply are overruled.  No prejudice.

Re Plaintiff’s motion:  Deny motion to strike; grant motion to tax expert costs; deny remainder.  Final cost bill for Bennett is $15,957.82 per CCP § 1032.

DISCUSSION

Defendant Bennett’s Motion

Fees and costs under Article 19.02 of the CC&Rs.   These provisions allow attorney fees to the prevailing party in an action to enforce the governing documents, as here.  Plaintiff opposes on the following grounds:

1.      Because Plaintiff was denied a fair trial, the court should deny prevailing party status on equitable grounds;

2.      Bennett is not entitled to claim fees under the CC&Rs (Art. 19.02) or Civil Code § 5975 because Plaintiff’s claims against Bennett were not for breach of the CC&Rs, but for her individual liability, separate and apart from her representative capacity for the HOA; and

3.      Plaintiff denies seeking fees from Bennett individually, and even Bennett in her Answer acknowledged Plaintiff’s inability to seek fees against Bennett.

As far as Plaintiff’s first point, the court has already denied Plaintiff’s new trial motion which raised similar grounds and the matter is before the Court of Appeal.   However, the court agrees with Plaintiff’s second and third arguments.  Bennett is not entitled to claim fees under the CC&Rs or Civil Code § 5975 because Plaintiff’s claims against Bennett, while intertwined with the HOA’s governing documents, were of the tort variety in her individual capacity and thus beyond the scope of the CC&Rs or Civil Code § 5975.

Fees and costs under CCP § 2033.420(b).

A party to a civil action may propound a written request that another party “admit the genuineness of specified documents, or the truth of specified matters of fact, opinion relating to fact, or application of law to fact.”  (CCP § 2033.010.)  “Requests for admission are not restricted to facts or documents, but apply to conclusions, opinions, and even legal questions.”  (City of Glendale v. Marcus Cable Associates, LLC (2015) 235 Cal.App.4th 344, 353.)  “The primary purpose of requests for admissions is to set at rest triable issues so that they will not have to be tried; they are aimed at expediting trial.”  (Brooks v. American Broadcasting Co. (1986) 179 Cal.App.3d 500, 509.) 

Properly and carefully drafted, RFAs can be powerful tools for trial because an admission is generally considered conclusive on the matter requested to be admitted, and no contradictory evidence may be introduced without leave of court.  (Murillo v. Superior Court (2006) 143 Cal.App.4th 730, 736 and citations therein.) 

As Defendant Bennett attempts to avail of here, RFAs provide an unusual incentive to narrow what needs to be proven at trial.  CCP § 2033.420 subd. (a) provides:  “If a party fails to admit the genuineness of any document or the truth of any matter when requested to do so under [section 2033.010], and if the party requesting that admission thereafter proves the genuineness of that document or the truth of that matter, the party requesting the admission may move the court for an order requiring the party to whom the request was directed to pay the reasonable expenses incurred in making that proof, including reasonable attorney's fees.”[1]

However, before the ”sanctions” Defendant seeks here are available, the party who propounded the RFA must “prove the truth” of the matter at issue before being entitled to recover expenses.  (CCP § 2033.420(a); Evid. Code § 190 [“ ‘Proof’ is the establishment by evidence of a requisite degree of belief concerning a fact in the mind of the trier of fact or the court.”].)  Once the party propounding the RFAs “proves the truth” of the particular RFA matter, the responding party has certain obligations if it wishes  to avoid an order to pay the propounding party’s expenses for having to prove the matter it sought to be admitted.  Pursuant to CCP § 2033.420, subd. (b), the responding/denying party must establish at least one of these four exceptions to the general rule in subd.(a):

(1)  An objection to the request was sustained or a response to it was waived under Section 2033.290.

(2)  The admission sought was of no substantial importance.

(3)  The party failing to make the admission had reasonable ground to believe that that party would prevail on the matter.

(4)  There was other good reason for the failure to admit. 

See Samsky v. State Farm (2019) 37 Cal.App.5^th 517, 523. 

Here, Defendant seeks all of her legal fees and costs purportedly incurred in proving the matters in certain RFAs propounded by Bennett to Plaintiff, by arguing as follows:

“On May 31, 2017, Defendant served a set of written discovery upon Plaintiff, including for the purposes of this Motion, a set of Requests for Admission ("RFA"). The RFAs asked Plaintiff to admit, among other things, that she did not have any evidence to support her causes of action against Defendant for breach of fiduciary duty, intentional infliction of emotional distress and nuisance.  On July 25, 2017, Plaintiff served responses to the RFAs which unequivocally denied each and every one of them.” (Motion 2:10-15)

Aside from moving party’s failure to specify the actual RFAs and responses (belatedly cured in her reply), Plaintiff offers evidence supporting at least one of the exceptions, i.e., that she had “reasonable ground to believe that that [she] would prevail on [the specified RFA/causes of action.]”  Defendant Bennett’s request for costs of proof sanctions is DENIED.

Reasonableness of fees.  Although the issue is moot, the court agrees that moving party has not met its burden to establish the reasonableness of the fees requested.  Without even a minimal showing of contemporaneous time records with sufficient descriptions of work performed by all counsel in this multi-party, multi-issue case, the court is unable to determine the elements required for the usual lodestar analysis.

Plaintiff’s motion

Defendant Bennett relies on a timely pre-trial statutory offer of $25,001 potentially triggering the following CCP § 998 provision against the Plaintiff:

“(c)  (1)  If an offer made by a defendant is not accepted and the plaintiff fails to obtain a more favorable judgment or award, the plaintiff shall not recover his or her postoffer costs and shall pay the defendant’s costs from the time of the offer. In addition, in any action or proceeding …, the court…, in its discretion, may require the plaintiff to pay a reasonable sum to cover postoffer costs of the services of expert witnesses, who are not regular employees of any party, actually incurred and reasonably necessary in either, or both, preparation for trial or arbitration, or during trial or arbitration, of the case by the defendant.”

Is Defendant’s 998 offer valid?

Paragraph 4 of Defendant’s 998 conditions acceptance upon the following:

“4.  This Offer to Compromiser, if accepted, will proceed by way of a general release, including a waiver of any and all claims known and unknown pursuant to California Civil Code § 1542.  (See Goodman v. Bank of San Pedro 1994) 27 Cal. App. 4^th 899, 905-906.)”

Neither party has submitted a copy of the contemplated “general release.”  Moreover, what “any and all claims” means is not spelled out. 

Plaintiff contends Defendant’s 998 offer is invalid on various grounds.  The court finds one ground dispositive “because it was conditioned on not only ending the current litigation but having Plaintiff release all claims, known and unknown, against her and, as such, was not capable of valuation.”  (Motion 4:18-20)

Plaintiff rightfully cites the recent 2^nd DCA case of Ignacio v. Caracciolo (2016) 2 Cal.App.5^th 81, where the 998 Offer was expressly conditioned upon the execution of an unattached ”Full and Final Release of All Claims,” which was to include a waiver of Civil Code Section 1542.  General releases which seek to release defendant and others from claims outside the scope of the current action render the offer invalid for purposes of 998 analysis.  Id. at 83. 

Including a waiver of the protections of Civil Code § 1542 in the actual release language found in the exemplar release submitted in Ignacio (Id., at 85) led that court to describe the language as “incredibly overbroad, and encompasses numerous claims the releasors may have against the releasees beyond those at issue in the lawsuit.” (Id., at 88)

Here, as Plaintiff points out, Defendant’s opposition fails to address the issue at all.  Because section 1542 provides that a general release “does not extend to claims that the creditor or releasing party does not know or suspect to exist..,” such a waiver would necessarily include a waiver of all known and unknown claims.  Defendant Bennett has not offered any evidence that would support a limited application of the release to the instant case. 

The holding in Ignacio has been recognized in a recent case:

“A valid section 998 offer may include terms requiring the release of all claims (by parties or nonparties) arising from the injury at issue in the lawsuit. (Citing Ignacio, supra, at 88) [“Boilerplate language identifying individuals and entities beyond the named parties in the case as releasors and releasees does not invalidate the offer, if the claims released relate only to the subject matter of the current litigation.”]…”  Khosravan v. Chevron Corp. (2021) 66 Cal. App. 5th 288, 296; emphasis added.)

Neither the proposed release, nor its specific terms, are before the court.   Defendant has not submitted evidence or authority to show that her 998 offer adheres to the Ignacio line of cases, e.g., that the released claims relate only to the matters against Bennett in the Third Amended Complaint), the court finds Bennett’s 998 invalid.  Defendant is not entitled to claim 998 costs.  Plaintiff’s motion to tax specific items in the memorandum is GRANTED in part, striking expert fees; DENIED in part, as to the remainder.