Judge Richard S. Whitney, Case 37-2022-00030661-CU-PO-CTL 2023-08-18 Tentative Ruling

Judge: Richard S. Whitney, Case: 37-2022-00030661-CU-PO-CTL, Date: 2023-08-18 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - August 17, 2023

08/18/2023 10:30:00 AM C-68 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Richard S. Whitney

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Civil - Unlimited PI/PD/WD - Other Demurrer / Motion to Strike 37-2022-00030661-CU-PO-CTL SAN DIEGO GAS & ELECTRIC COMPANY VS FLATIRON WEST INC [IMAGED] CAUSAL DOCUMENT/DATE FILED:

TENTATIVE RULING: CROSS-DEFENDANT SAN DIEGO GAS & ELECTRIC COMPANY'S DEMURRER TO FLATIRON WEST, INC.'S CROSS-COMPLAINT is OVERRULED.

Plaintiff/Cross-Defendant SAN DIEGO GAS & ELECTRIC COMPANY ('Plaintiff') asserts that Defendant and Cross-Complainant Flatiron West, Inc.'s ('Defendant') cross-complaint fails because the scope of the subject settlement agreement does not include the incident that is the subject of this action. The parties' requests for judicial notice are granted.

Defendant asserts the Court must accept Defendant's interpretation of the settlement whereas Plaintiff asserts Defendant's interpretation is unreasonable.

'[W]here an ambiguous contract is the basis of an action, it is proper, if not essential, for a plaintiff to allege its own construction of the agreement. So long as the pleading does not place a clearly erroneous construction upon the provisions of the contract, in passing upon the sufficiency of the complaint, we must accept as correct plaintiff's allegations as to the meaning of the agreement.' (Marina Tenants Assn. v. Deauville Marina Development Co. (1986) 181 Cal.App.3d 122, 128 [226 Cal.Rptr. 321].) (Aragon-Haas v. Family Security Ins. Services, Inc. (1991) 231 Cal.App.3d 232, 239.) '[A] general demurrer to the complaint admits not only the contents of the instrument but also any pleaded meaning to which the instrument is reasonably susceptible.' (Id.) 'Unless the interpretation proffered in the complaint is conclusively negated by a provision in the contract, a demurrer is improper.' (Hayter Trucking, Inc. v. Shell Western E&P, Inc. (1993) 18 Cal.App.4th 1, 12.) The Court agrees that there is enough ambiguity in the settlement agreement to permit the Court to accept Defendant's interpretation of the settlement attached to the cross-complaint for purposes of this demurrer. The mutual release broadly states that the parties release the parties as to 'any and all past, present or future known or unknown claims... that are alleged or could have been alleged in the ACTION.' (Cross-complaint, Exhibit A.) The release also provides that '[s]ubject to the exclusions stated below, this release is to be broadly construed and includes all issues, claims, losses, liabilities and damages relating to any and all acts, omissions, statements, non-feasance, misfeasance, and/or conduct of SETTLING DEFENDANTS relating to or arising out of the INCIDENT.' (Cross-complaint, Exhibit A.) The term 'INCIDENT' is defined in the settlement as being Plaintiff's lawsuit filed 'with the San Diego Superior Court, styled San Diego Gas & Electric Company v. Avar Construction, Inc,, et al., bearing San Diego Superior Court Case No. 37-2021-00008957-CU-P0-CTL, seeking damages related to a March 7, 2018 gas line breach located at the PROJECT.' (Cross-complaint, Exhibit A.) Calendar No.: Event ID: TENTATIVE RULINGS

2939263 58 CASE NUMBER: CASE TITLE: SAN DIEGO GAS & ELECTRIC COMPANY VS FLATIRON WEST INC 37-2022-00030661-CU-PO-CTL Plaintiff argues that it would be unreasonable to interpret the release as applying to an incident that happened after March 7, 2018, to an electric facility, not a gas line. However, the settlement explicitly states it is to be interpreted broadly and that 'any and all past, present or future known or unknown claims... that are alleged or could have been alleged in the ACTION' are released. (Cross-complaint, Exhibit A.) While Plaintiff is correct that the settlement states, in a separate sentence, that the release also releases 'all issues, claims, losses, liabilities and damages relating to any and all acts, omissions, statements, non-feasance, misfeasance, and/or conduct of SETTLING DEFENDANTS relating to or arising out of the INCIDENT' where the 'INCIDENT' is defined as the damages related to a March 7, 2018 gas line breach, this limitation does not necessarily modify the release as to claims that 'could have been alleged in the ACTION.' (Cross-complaint, Exhibit A.) The two separate sentences could be interpreted as being cumulative and not mutually exclusive such that the limitation that the release applies to damages 'arising out of the INCIDENT' would not limit the fact the release broadly applies to any claim that 'could have been alleged in the ACTION.' It is undisputed that the 'ACTION' was not filed until after the incident alleged in this action. Therefore, it is arguable that the settlement could possibly apply to the incident in this action which had occurred by the time the prior 'ACTION' was filed.

Moreover, the settlement contemplated exclusions to the release that did not include the incident in this action. It is undisputed that the parties negotiated the settlement in the prior action after the incident occurred in this action. Therefore, it is not unreasonable to infer that if the parties intended to exclude the claims in this action, they would have so stated in the settlement. The fact the parties did not include the incident in this action among the issues to be excluded from the broad settlement could be interpreted as a sign of intent on the part of the negotiating parties that such incident was released.

Therefore, the Court cannot conclude that the settlement must be interpreted as Plaintiff suggests.

There are sufficient ambiguities in the settlement to preclude this demurrer. The demurrer is overruled.

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