Judge: Robert B. Broadbelt, Case: 20STCV46465, Date: 2023-03-23 Tentative Ruling
Tentative rulings are sometimes, but not always, posted. The purpose of posting a tentative ruling is to to help focus the argument. The posting of a tentative ruling is not an invitation for the filing of additional papers shortly before the hearing.
Case Number: 20STCV46465 Hearing Date: March 23, 2023 Dept: 53
Superior Court of California
County of Los Angeles – Central District
Department
53
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fitness international, llc vs. wedge office, llc |
Case
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20STCV46465 |
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Hearing
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March
23, 2023 |
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[Tentative]
Order RE: motion for summary judgment or, in the
alternative, summary adjudication |
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MOVING PARTY: Defendant Wedge Office, LLC
RESPONDING PARTY: Plaintiff
Fitness International, LLC
Motion for Summary Judgment or, in the Alternative, Summary
Adjudication
The court
considered the moving, opposition, and reply papers filed in connection with
this motion.
EVIDENTIARY OBJECTIONS
The court notes that plaintiff
Fitness International, LLC (“Plaintiff”) has filed various objections to the
evidence filed by defendant Wedge Office, LLC (“Defendant”), and in some
instances, has not numbered the objections as required by California Rules of
Court, rule 3.13542, subdivision (b).
The court exercises its discretion to rule on the objections notwithstanding
this procedural defect. The court rules
on the objections in numerical order.
The court rules on Plaintiff’s evidentiary objections to Defendant’s
Request for Judicial Notice, filed on January 18, 2023, as follows:
The court overrules Objection No. 1.
The court sustains Objection Nos. 2-30.
The court rules on Plaintiff’s evidentiary objections to the
declaration of Matthew A. Montgomery, filed on January 18, 2023, as follows:
The court sustains Objection No. 6.
The court overrules Objections Nos. 1-5 and 7-19.
The court rules on Plaintiff’s evidentiary objections to Defendant’s Compendium
of Exhibits, filed on January 18, 2023, as follows:
The court sustains Objections Nos. 5-6.
The court overrules Objections Nos. 1-4
The court declines to rule on the remaining objections because they
are directed to evidence that is not material to the court’s disposition of this
motion. (Code Civ. Proc., § 437c,
subd. (q).)
The court rules on Plaintiff’s evidentiary objections to the
declaration of Fred L. Wilks, filed on January 18, 2023, as follows:
The court sustains Objections Nos. 4-5.
The court overrules Objections Nos. 1-3 and 6.
The court declines to rule on
the remaining objections because they are directed to evidence that is not
material to the court’s disposition of this motion. (Code Civ. Proc., § 437c, subd. (q).)
The court rules on Defendant’s evidentiary objections to the
declaration of Diann D. Alexander, filed on January 27, 2023, as follows:
The court sustains Objections Nos. 2 and 3.
The court overrules Objections Nos. 1, 4, 9-10, and 17-18.
The court declines to rule on the remaining objections because they
are directed to evidence that is not material to the court’s disposition of the
motion. (Code Civ. Proc., § 437c,
subd. (q).)
JUDICIAL NOTICE
The court grants Defendant’s
request for judicial notice as to Exhibit 1.
(Evid. Code, § 452, subd. (c).)
The court denies Defendant’s request for judicial notice as to Exhibits
2 through 30 because they are not relevant to material issues presented by this
motion. (Malek Media Group, LLC v.
AXQG Corp. (2020) 58 Cal.App.5th 817, 825 [“Any matter to be judicially
noticed must be relevant to a material issue”].)
The court grants Plaintiff’s
request for judicial notice, filed on January 18, 2023, as to Exhibits 20,
23-35, 39, 40, and 41. (Evid. Code, §
452, subd. (c).) The court denies
Plaintiff’s request for judicial notice as to Exhibits 21-22 and 36-38. The court denies Plaintiff’s request for
judicial notice as to Exhibits 42-48 because they are not relevant to material
issues presented by this motion. (Malek
Media Group, LLC, supra, 58 Cal.App.5th at p. 825.)
The court denies Defendant’s supplemental
request for judicial notice, filed on January 27, 2023, because it is an
improper attempt to submit new evidence in reply. (Jay v. Mahaffey (2013) 218
Cal.App.4th 1522, 1537-1538.)
The court notes that, even
though the court has denied some of the parties’ requests for judicial notice
as to the exhibits specified above, the court may still consider them as
evidence in ruling on this motion, except as to the exhibits to which the court
has sustained objections. (Code Civ.
Proc., § 437c, subd. (c) [“the court shall consider all of the evidence
set forth in the papers, except the evidence to which objections have been
made and sustained by the court] [emphasis added].)
LEGAL STANDARD
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 judgment as a matter of law.” (Adler
v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.)
“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 or cross-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 or cross-defendant has met that burden, the burden shifts to the
plaintiff or cross-complainant 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., § 437c, 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.4th 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
p. 467; Code Civ. Proc., § 437c, subd. (c).)
Defendant moves for an order granting its
motion for summary judgment, or, in the alternative, summary adjudication as to
each cause of action alleged by Plaintiff in its Complaint. The parties have addressed the relief
requested in Plaintiff’s sixth cause of action for declaratory judgment
first. The court therefore rules on
Defendant’s motion as to the sixth cause of action for declaratory judgment
first, and addresses the remaining causes of action in numerical order.
1. Sixth
Cause of Action for Declaratory Judgment
Any
person interested under a written instrument or under a contract, or who
desires a declaration of his rights or duties with respect to another, may, in
cases of actual controversy relating to the legal rights and duties of the
respective parties, bring an original action for a declaration of rights and
duties, and the court may make a binding declaration of these rights or
duties. (Code Civ. Proc., § 1060.) “‘The fundamental basis of
declaratory relief is the existence of an actual, present controversy over
a proper subject.’” (City of Cotati v. Cashman (2002) 29 Cal.4th
69, 79.)
Plaintiff
requests the following judicial declarations: (1) Plaintiff has no obligation
to pay rent to Defendant during the closure period; (2) Defendant is required
to excuse Plaintiff’s performance under the parties’ lease during the closure
period by operation of California law, including Civil Code section 1511; (3)
Defendant is required to excuse Plaintiff’s performance under the lease because
the parties’ intent in entering the lease is frustrated during the closure
period; (4) Defendant is required to excuse Plaintiff’s performance under the
lease because performance is temporarily impossible during the closure period;
(5) Defendant is required to excuse Plaintiff’s performance under the lease
because performance is impracticable during the closure period; (6) Defendant
is required to return to Plaintiff all monies paid by Plaintiff to Defendant
during the closure period; (7) rent during the period of the time Plaintiff is
subject to the ongoing restrictions is proportionately abated; (8) Plaintiff
may recover its reasonable costs and attorney’s fees; and (9) Plaintiff may
recover any other such relief deemed just and reasonable. (Compl., ¶ 101.)
A.
Excusal of Performance under Civil Code section
1511
Plaintiff
seeks a judicial declaration that “Defendant is required to excuse Plaintiff’s
performance under the Lease during the Closure Period by operation of
California law, including, without limitation, California Civil Code [section]
1511 [subdivision] (1)[.]” (Compl.,
¶ 101, subd. (b).)
Performance
of an obligation is excused “[w]hen such performance or offer is prevented or
delayed … by the operation of law….”
(Civ. Code, § 1511, subd. (1); SVAP III Poway Crossings, LLC v.
Fitness International, LLC (2023) 87 Cal.App.5th 882, 873 (“SVAP III”)
[“Section 1511(1) provides that a party’s performance of its contractual
obligation is excused where the operation of law prevents or delays the performance”].)
The
court finds that Defendant has met its burden of showing that Plaintiff
cannot establish that its performance under the parties’ lease was excused
pursuant to Civil Code section 1511 since Defendant has shown that an element of
the defense (the prevention or delay of performance by operation of law) cannot
be established.
Defendant
submits a copy of the parties’ “Water’s Edge Retail Lease” dated May 25, 2012
(the “Lease”). (Def.
Compendium of Evidence (“Def. COE”) Ex. A, Lease; Undisputed Material Fact
(“UMF”) No. 1 [undisputed as to fact that Plaintiff and Defendant are parties
to the Lease for the subject premises].)
Pursuant
to the Lease, Plaintiff is obligated to pay to Defendant the amount of rent
specified in the agreement each month, “without any setoff or deduction
whatsoever except as otherwise expressly provided” by the terms of the Lease. (Def. COE Ex. A, Lease,
§ 6.1.) Defendant contends that
Plaintiff’s performance of this obligation was not prevented or delayed by operation
of law, and specifically, was not prevented or delayed by the government orders
enacted in response to COVID-19.
Defendant presents (1) Executive Order
N-28-20, issued by Governor Newsom on March 16, 2020, which ordered that (i)
any cause of action that could be used to evict a residential or commercial
tenant is suspended as set forth in the order, but (ii) its terms did not
“relieve a tenant of the obligation to pay rent[;]” (2) an ordinance adding
Article 14.6 to the Los Angeles Municipal Code to temporarily prohibit
residential and commercial evictions due to COVID-19, which states that its
terms do not eliminate any obligation to pay lawfully charged rent; (3)
Plaintiff’s further supplemental responses to Defendant’s requests for
admission, in which Plaintiff admitted that no government body prohibited
Plaintiff from paying rent due under the lease from January 1, 2020, through
the present; and (4) the deposition testimony of Diann Alexander, Plaintiff’s
person most qualified, who stated that she was unaware of any law that made it
illegal to pay rent and confirmed that Plaintiff paid all rent owed to
Defendant. (RJN Ex. 1, ¶ 2; Def.
COE Ex. G, § 49.99.3; Def. COE Ex. X, Response to Requests for Admission,
pp. 2:9-10, 3:1-7; Def. COE Ex. R, Alexander Dep., pp. 67:24-68:17.) The parties do not dispute that Plaintiff has
paid all rent and other charges due and owing under the Lease. (UMF No. 49.)
The
court finds that Defendant has met its burden of producing evidence showing
that (1) Plaintiff’s obligation under the Lease is to pay rent to Defendant,
and (2) Plaintiff was not prevented or delayed from the performance of this
obligation by the operation of law, because (i) the executive order and
ordinances did not discharge the obligation to pay rent, (ii) Plaintiff has
admitted that there was no law that made performance of this obligation
illegal, and (iii) Plaintiff actually performed this obligation by paying all
rent specified in the lease. (Def. COE
Ex. A, Lease, § 6.1; RJN Ex. 1; Def. COE Ex. R, Alexander Dep., pp.
67:24-68:9; UMF No. 49.)
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of the prevention or delay
of Plaintiff’s performance by operation of law.
In opposition and in its Complaint, Plaintiff contends that the
closure orders prevented Plaintiff from using the premises during the closure
periods and therefore excused Plaintiff’s obligation to pay rent. Plaintiff appears to base this argument on
the contention that the purpose of the Lease was for Plaintiff to operate a health
club and fitness facility; therefore, Plaintiff argues, because Plaintiff was
prevented from operating its health club and fitness facility, it was excused
from its obligation to pay rent.
Plaintiff relies on two provisions in the Lease in support of this
argument. First, section 1.11 of the
Lease, entitled “Permitted Use,” provides as follows: “Operation of a health club and fitness
facility initially under the Trade Name reference in Section 1.4 above
and in accordance with this Lease . . ., which shall include [various equipment
and lessons] (collectively, the ‘Primary Permitted Use(s)’). The Premises shall be used principally for
the Primary Permitted Use.” (Def. COE
Ex. A, Lease, § 1.11.) Certain
other uses, to the extent ancillary to the Primary Permitted Use, are permitted
(defined as the “Ancillary Permitted Use(s)” in the Lease). (Ibid.) Second, section 4.1, subdivision (a) of the
Lease states the following: “Tenant
shall use the Premises solely for the Permitted Use (as defined in Section
1.11) and Tenant shall not use or permit the Premises to be used for any other
purpose or purposes whatsoever without the prior written consent of Landlord,
which consent Landlord shall not unreasonably withhold provided Tenant
continues to operate for Tenant’s Primary Permitted Use.” (Def. COE Ex. A, Lease, § 4.1, subd.
(a).)
The court acknowledges that sections 1.11 and 4.1 restrict
Plaintiff’s use of the premises to a particular use (i.e., the operation of a
health club and fitness facility with certain designated ancillary uses). However, Plaintiff has not pointed to any
language in the Lease which requires Plaintiff to perform by using the premises
in the specified manner. Although the
Lease limits Plaintiff’s use of the premises for a particular purpose, the
Lease does not impose an affirmative obligation on Plaintiff to use the
premises in that manner no matter the circumstance. For example, it appears that there would be
no breach of the Lease if Plaintiff had chosen to continue paying rent while
opting to leave the premises vacant and declining to operate a health club and
fitness facility on the premises. Thus,
the language of the Lease does not affirmatively obligate Plaintiff to perform
by operating a health club and fitness facility.
Even if the court were to find that the Lease required Plaintiff
to perform by operating a health club and fitness facility, Plaintiff does not
request a declaration that it was excused from performance of that obligation.
Plaintiff does not appear to dispute that it was required to pay
rent pursuant to the terms of the Lease, and the court has found that Plaintiff
was so obligated. (Def. COE Ex. A,
Lease, § 6.1 [“Tenant shall pay, without notice or demand except as otherwise
expressly provided herein . . . base
rent”].) It is performance of this
obligation from which Plaintiff seeks to be excused. Specifically, Plaintiff has
alleged the following: Plaintiff’s
obligations under the Lease, including the payment of rent, were legally
excused; the purpose of the Lease was frustrated since Plaintiff was prohibited
from using the premises; performance was impossible because Plaintiff was
prohibited from using the premises; and performance was impracticable because
Plaintiff was prohibited from using the premises and was not generating revenue
from membership fees and dues. (Compl.,
¶¶ 34-38.) In its Complaint, Plaintiff
has generally asserted that Defendant’s demand that Plaintiff pay rent in full was
improper and seeks reimbursement of rent paid during the relevant time
periods. (Compl., ¶¶ 5, 46-52.)
The court finds that, because Plaintiff seeks to be excused from
performing its obligation to pay rent, that is the obligation to be
evaluated. Thus, the determinative issue
is whether Plaintiff has submitted evidence sufficient to show that a triable
issue of material fact exists as to whether its performance of this obligation was
“prevented or delayed . . . by the operation of law . . . .” (Civ. Code, § 1511, subd. (1).)
The court finds that Plaintiff has not met that burden. Plaintiff has not submitted any evidence
showing that the subject government orders prevented Plaintiff from paying rent
to Defendant. Instead, Plaintiff has
generally presented evidence showing that it was unable to operate its fitness
facility (1) from March 16, 2020 to June 11, 2020, and (2) from July 13, 2020
through March 14, 2021. (Pl. Compendium
of Evidence (“Pl. COE”) Ex. 24, ¶ 7 [March 15, 2020 Public Order closing
gyms and fitness centers to the public], Ex. 25, Ex. 26A, ¶ 3, subd.
(h)(ii) [April 10, 2020 Stay at Home Order mandating the continued closure of
gyms and fitness centers], Ex. 33, ¶ 3, subd. (a) [ordering certain
counties to close all indoor operations of gyms and fitness centers]; Alexander
Decl., ¶¶ 30, 33 [“Since March 15, 2021, [Plaintiff] has remained open in the
Premises, operating its health club and fitness facility”].) The court finds that this evidence is
insufficient to show a triable issue of material fact exists as to whether the
government orders prevented or delayed Plaintiff from fulfilling its
obligations under the Lease to pay rent to Defendant.
B.
Excusal of Performance under Doctrine of
Frustration of Purpose
Plaintiff seeks a judicial declaration that “Defendant is required
to excuse Plaintiff’s performance under the Lease because the parties’ intent
and purpose in entering the Lease is frustrated during the Closure
Period[.]” (Compl., ¶ 101, subd.
(c).)
Application of the doctrine of frustration of purpose discharges
the promisor from the duty of performing their promise. (20th Century Lites, Inc. v. Goodman (1944)
64 Cal.App.2d Supp. 938, 945.) “[A]
promisor seeking to excuse himself from performance of his obligations [is
required] to prove that the risk of the frustrating event was not reasonably
foreseeable and that the value of counterperformance is totally or nearly
totally destroyed, for frustration is no defense if it was foreseeable or
controllable by the promisor, or if counterperformance remains valuable.” (Lloyd v. Murphy (1944) 25 Cal.2d 48,
54.) “[L]aws or other governmental acts
that make performance unprofitable or more difficult or expensive do not excuse
the duty to perform a contractual obligation [citations].” (Id. at p. 55.)
The court finds that Defendant has met its burden to show
that Plaintiff cannot establish its entitlement to a declaratory judgment that
its performance under the lease is excused under the doctrine of frustration of
purpose because Defendant has shown that an element of the doctrine (the value
of the counter performance is totally or nearly totally destroyed) cannot be
established.
As to the remaining tenancy under the Lease, Defendant presents
evidence showing that (1) the Lease includes an initial term of 15 years, with
two options to extend for five years each; (2) the term of the Lease commenced
on September 4, 2013; and (3) therefore the initial term of the Lease expires
on September 3, 2028, with the option to renew the lease for another 10 years,
or until September 3, 2038. (Def. COE
Ex. A, Lease, §§ 1.7, 5.4, subd. (a); Def. COE Ex. B, Memorandum of Lease
Commencement, §§ 2-3.) Defendant
also submits evidence showing that (1) Plaintiff did not terminate the Lease,
and instead continued to store equipment, furniture, and other infrastructure
on the property; (2) Plaintiff did not surrender possession of the premises to
Defendant; and (3) Plaintiff had access to the premises. (UMF Nos. 41-42 [Plaintiff has not terminated
the Lease or surrendered the premises]; Def. COE Ex. R, Alexander Dep., pp.
101:10-13 [Defendant did not remove Plaintiff’s equipment from premises],
60:6-19 [Plaintiff’s employee checked on the premises during the closure
orders], 61:3-10 [employees checked on premises, on average, once a week or
once every other week], 61:19-24 [Defendant did not restrict Plaintiff’s access
to premises].) Finally, Defendant asserts
that the Lease provides Plaintiff with the ability to change the use of the
premises with Defendant’s consent but did not do so. (Def. COE Ex. A, Lease, § 4.1, subd. (a)
[providing that Plaintiff shall use the premises solely for the permitted use and
shall not use the premises for any other purpose “without the prior written
consent of [Defendant], which consent [Defendant] shall not unreasonably
withhold” provided that Plaintiff continue to operate for its permitted use].)
The court finds that this evidence is sufficient to show that any
interference with Plaintiff’s ability to operate its business under the subject
governmental orders did not totally destroy the value of the Lease, therefore
precluding application of the doctrine of frustration of purpose. “‘Even more clearly with respect to leases
than in regard to ordinary contracts the applicability of the doctrine of
frustration depends on the total or nearly total destruction of purpose for
which, in the contemplation of both parties, the transaction was entered
into.’” (Lloyd, supra, 25
Cal.2d at p. 53.) Defendant has
presented evidence showing that any temporary interruption caused by the
government closure orders did not result in “the total or nearly total
destruction of purpose” of the parties’ lease, which provides for up to an
initial tenancy of 15 years, and the possibility of a 25-year tenancy. (Ibid; SVAP III, supra,
87 Cal.App.5th at p. 895.)
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of the total or near
total destruction of the value of counter performance. In its opposition, Plaintiff contends that
the doctrine of frustration applies and excuses its performance under the Lease
because (1) the parties’ purpose in entering into the Lease was for Plaintiff
to operate a health club and fitness facility on the Lease, which was
frustrated during the closure periods, and (2) the concept of temporary
frustration is recognized in California and applies to the circumstances
presented here.
First, Plaintiff has not submitted evidence showing that the total
value of the Lease was destroyed. As set
forth above, Plaintiff has submitted evidence showing that (1) it was unable to
operate its business pursuant to government orders (i) from March 16, 2020 to
June 11, 2020, and (ii) from July 13, 2020 to March 14, 2021, and (2) Plaintiff
reopened on March 15, 2021 and has remained open since that date. (Alexander Decl., ¶¶ 30, 32-33.) Thus, at best, Plaintiff has shown that it
was unable to operate its fitness facility for approximately 11 months.
Even if the court concluded—as Plaintiff argues—that the purpose
of the Lease was for Plaintiff to operate a health club and fitness facility, “[t]he
temporary government closure of a fitness facility for a period of months when
the premises have been leased for more than [six years]—and the lease term
spans more than [15 years for the initial term, with two options to extend the
term for five years each]—does not amount to the kind of complete frustration
required for the doctrine to apply.” (SVAP III, supra, 87 Cal.App.5th at p. 895; Def. COE
Ex. B, Memorandum of Lease Commencement [term of Lease commenced on September
4, 2013]; Def. COE Ex. A, Lease, § 1.7 [defining term].)
Second, although Plaintiff argues that temporary frustration
excused its performance under Maudlin v. Pac. Decision Sciences (2006)
137 Cal.App.4th 1001, the court disagrees.
As noted by the Court of Appeal in the recent SVAP III decision,
“that case involved temporary impossibility.” (SVAP, III, supra, 87
Cal.App.5th at p. 896; Maudlin, supra, 137 Cal.App.4th at p. 1017
[“California law on temporary impossibility mirrors the Restatement
Second of Contracts, section 269”].)
The court therefore finds that Plaintiff has failed to meet its
burden of producing evidence sufficient to show that a triable issue of material
fact exists as to the total or near total destruction of the Lease and
therefore has not shown that a triable issue of material fact exists as to the
application of the doctrine of frustration of purpose to excuse Plaintiff’s
performance under the Lease.
C. Excusal
of Performance under Doctrine of Impossibility
Plaintiff seeks a judicial declaration that “Defendant is required
to excuse Plaintiff’s performance under the Lease because performance is
temporarily impossible during the Closure Period[.]” (Compl., ¶ 101, subd. (d).)
Impossibility is defined “as not only strict impossibility but as
impracticability because of extreme and unreasonable difficulty, expense,
injury or loss involved.” (Oosten v.
Hay Haulers Dairy Emp. & Helpers Union (1955) 45 Cal.2d 784, 788.) “The defense of impossibility may apply where
. . . a government order makes it unlawful for a party to perform its
contractual obligations.” (SVAP III,
supra, 87 Cal.App.5th at p. 893.)
In assessing the application of the defense of impossibility, “the
question to be decided is whether the party asserting the defense has
demonstrated that it was impossible to perform its own contractual obligations
to the other contracting party such that it may avoid liability for its non-performance.” (Ibid.)
The court finds that Defendant has met its burden to show
that Plaintiff cannot establish its entitlement to a declaratory judgment that
its performance under the lease is excused under the doctrine of impossibility
because Defendant has shown that it was not impossible for Plaintiff to perform
its contractual obligations to pay rent.
As set forth above, the court has concluded that, because
Plaintiff seeks to be excused from performance of its obligation to pay rent,
that is the contractual obligation that must be evaluated in the context of
each of the doctrines under which Plaintiff alleges it is entitled to
relief. The court finds that Defendant
has met its burden of showing that the relevant contractual obligation to pay
rent was not unlawful or impossible. First,
Defendant presents Plaintiff’s discovery response in which it admitted that no
government body prohibited Plaintiff “from paying rent due under the [Lease] at
any time during the period from January 1, 2020 through the present.” (Def. COE Ex. X, pp. 2:8-10, 3:1-2.) Second, it is undisputed that Plaintiff has
paid all rent and other charges under the Lease. (UMF No. 49.) Thus, the court finds that Defendant has
produced evidence showing that the government orders did not prevent or make it
impossible for Plaintiff to perform its own contractual obligations (i.e., to
pay rent) to Defendant.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of the impossibility
to perform Plaintiff’s own contractual obligations to Defendant.
Plaintiff argues that the government orders “made performance of
the object of the Lease impossible and impracticable—that is, [Plaintiff] could
not operate a health club and fitness facility, as the Lease required it to
do.” (Opp., p. 25:12-14.) As above, Plaintiff bases this contention on
the ground that the purpose in entering the Lease was for Plaintiff to operate
a health club and fitness facility on the premises. However, the court has found that (1) the
Lease did not impose an affirmative obligation on Plaintiff to use the premises
in this manner, and instead only limited the permitted use of the premises to
the ones specified therein, and (2) even if Plaintiff had shown that it was
obligated to perform under the Lease by, at all times and during the relevant
closure periods, operating a health club and fitness facility, Plaintiff has
not sought to be excused from performing that obligation.
Thus, the court finds that the relevant obligation to evaluate—and
question to be decided—is whether Plaintiff “has demonstrated that it was
impossible to perform its own contractual obligation” to pay rent to Defendant,
“such that it may avoid liability for its non-performance.” (SVAP III, supra, 87
Cal.App.5th at p. 893.) Plaintiff has
not presented any evidence or sufficient argument showing that payment of rent
to Defendant was impossible or unlawful due to the government closure orders. The court therefore finds that Plaintiff has
not met its burden to show that a triable issue of material fact exists as to
whether performance of its obligation to pay rent under the Lease was rendered
impossible due to the subject government mandates. (Ibid. [“Nothing about the pandemic or
resulting closure orders has made Fitness’s performance of its obligation to
SVAP—paying rent—impossible”].)
D. Excusal
of Performance under Doctrine of Impracticability
Plaintiff seeks a judicial declaration that “Defendant is required
to excuse Plaintiff’s performance under the Lease because performance is
impracticable during the Closure Period[.]”
(Compl., ¶ 101, subd. (e).)
“‘[A] thing is impracticable when it can only be done at an
excessive and unreasonable cost.’” (Mineral
Land Co. v. Howard (1916) 172 Cal.289, 293; SVAP III, supra,
87 Cal.App.5th at p. 893 [quoting Mineral Land Co., supra, 172
Cal. at p. 293].) “This does not mean
that a party can avoid performance simply because it is more costly than
anticipated or results in a loss.
[Citation.] Impracticability does
not require literal impossibility but applies when performance would require
excessive and unreasonable expense.” (Habitat
Trust for Wildlife, Inc. v. City of Rancho Cucamonga (2009) 175 Cal.App.4th
1306, 1336 [internal citation omitted].)
The court finds that Defendant has met its burden to show that
Plaintiff cannot establish its entitlement to a declaratory judgment that its
performance under the Lease is excused under the doctrine of impracticability
because Defendant has shown that Plaintiff’s performance could have only been
done “at an excessive and unreasonable cost.”
(Mineral Land Co., supra, 172 Cal. at p. 293.)
Defendant submits evidence showing that the government
restrictions put in place due to COVID-19 “did not increase the rental rate or
the amount of rent [Defendant] claimed was due under the Lease.” (UMF No. 56 [undisputed in part on the ground
that there is no claim that the rent was increased]; Montgomery Decl.,
¶ 10.) Thus, the court finds that
Defendant has submitted evidence sufficient to show that Plaintiff’s
performance under the Lease could not have been done at an excessive or
unreasonable cost.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of an excessive and
unreasonable cost of its performance.
As argued in connection with the doctrine of impossibility,
Plaintiff contends that its performance under the Lease was impracticable
because Plaintiff could not operate a health club and fitness facility. (Opp., p. 25:12-14.) However, as set forth above, Plaintiff seeks
not to be excused from its performance of its operation of its fitness
facility, but instead seeks to be relieved from its obligation to pay rent,
thus requiring the court to evaluate the impracticability of the performance of
that obligation.
Plaintiff has not presented any evidence showing that paying rent
to Defendant pursuant to the terms of the Lease could have “only be done at an
excessive and unreasonable cost.” (Mineral
Land Co., supra, 172 Cal. at p. 293.) Although the court recognizes that Plaintiff
argues that it was forced to bear the loss of nearly all revenue from its
facility due to the government orders, Plaintiff has not presented evidence
showing that performing its obligation to pay rent to Defendant, at the same
rate as before the government closure orders, could only have been done at an
excessive and unreasonable cost.
E. Obligation
to Pay Rent
Plaintiff requests a judicial declaration that “Plaintiff has no
obligation to pay Rent to Defendant during the Closure Period[.]” (Compl., ¶ 101, subd. (a).)
The court finds that Defendant has met its burden to show that
Plaintiff cannot establish its entitlement to a declaratory judgment that
Plaintiff has no obligation to pay rent to Defendant during the closure period
because, as set forth above, Defendant has shown that Plaintiff’s performance
under the Lease was not excused pursuant to the doctrines of frustration of
purpose, impossibility, impracticability, or under Civil Code section 1511.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to whether Plaintiff had an
obligation to pay rent to Defendant during the closure periods because, as set
forth above, Plaintiff did not produce evidence showing that its obligation to
pay rent was excused or otherwise not required during that time period.
F. Return
of Monies Paid to Plaintiff
Plaintiff requests a judicial declaration that “Defendant is
required to return to Plaintiff all monies paid by Plaintiff to Defendant
during the Closure Period[.]” (Compl.,
¶ 101, subd. (f).)
The court finds that Defendant has met its burden to show that
Plaintiff cannot establish its entitlement to a declaratory judgment that
Defendant is required to return to Plaintiff all money paid during the closure
period because, as set forth above, Defendant has shown that Plaintiff’s
performance was not excused and therefore has shown that Defendant is not
“required to return to Plaintiff all monies paid” during the relevant time
period.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of the requirement to
return to Plaintiff all money paid during the closure period because, as set
forth above, Plaintiff has not met its burden of producing evidence to show
that (1) Plaintiff was not required to pay rent to Defendant during the closure
periods, and therefore (2) Defendant improperly collected money from Plaintiff
that must be returned.
G. Abatement
of Rent
Plaintiff requests a judicial declaration that “Rent during the
period of time [Plaintiff] is subject to the On-Going Restrictions is
proportionately abated (e.g., if 10% capacity, Rent is reduced to
10%)[.]” (Compl., ¶ 101, subd.
(g).)
The court finds that Defendant has met its burden to show that
Plaintiff cannot establish its entitlement to a declaratory judgment that rent
during the relevant time period is proportionately abated because Defendant has
shown that the provisions providing for abatement of rent do not apply to the
circumstances presented by the government closure and restriction orders.
The Lease includes the following relevant provisions concerning
the abatement of rent or offset of costs: (1) Plaintiff was not obligated to
pay the base rent for the second through fifth months of the initial term,
provided Plaintiff was not in default; (2) if Defendant fails to timely
reimburse Plaintiff for self-help work costs, Plaintiff is entitled to offset
all self-help work costs through rental offset, provided that amount is not
more than 50 percent of the base rent, per month; (3) in the event that damage
to or destruction of the premises is caused by fire or other casualty renders
the premises untenable and prevents feasible operation of business from all or
part of the premises, Plaintiff’s obligation to pay rent shall be abated
proportionally; (4) in the event that the premises is taken by any lawful power
or authority by exercise of the right of eminent domain, or sold to prevent
that taking, rent shall be abated in proportion to the time during which, and
to the part of the premise of which, Plaintiff is deprived of on account of the
taking; and (5) except in the event of damage, if the premises is rendered
untenable and is not used by Plaintiff for a period of at least five business
days or 10 business days in any 12 month period as a result of (i) a failure of
the building systems or lack of reasonable access to the premises, or (ii)
interruption in utility services solely or primarily because of Defendant’s
failure to supply utilities as required under the lease, rent shall be reduced
and abated. (Def. COE Ex. A, Lease,
§§ 6.2, 17.3, subd. (a)(4), 20.1, 21.1, 30.)
Defendant has presented evidence showing that the Lease does not
require Defendant to abate rent based on the government closure orders. As noted by Defendant, Plaintiff’s Complaint
does not allege that Defendant failed to abate rent under the Lease (1) for the
second through fifth months of the initial term; (2) to reimburse Plaintiff for
self-help work costs; (3) to compensate Plaintiff for untenable premises due to
damage to or destruction of the premises by fire or other casualty; or (4) due
to the exercise of eminent domain.
(Compl., ¶¶ 65-71.)
In opposition, Plaintiff contends that Defendant was required to
abate rent pursuant to section 30 of the Lease.
Section 30 provides for the abatement of rent, as follows: “Except in the event of Damage (which is
separately addressed in Article 20 above), if the Premises or any
portion thereof is rendered untenantable and is not used by Tenant for a period
of at least five (5) consecutive business days or ten (10) business days in any
twelve (12) month period (each five (5) consecutive day or ten (10) day in
twelve (12) months, as applicable, the ‘Eligibility Period’) as a result of (a)
failure of the Building Systems, or lack of reasonable access to the Premises
within the Project, or (b) interruption in utility services solely or primarily
because of the failure by Landlord to supply utilities to the Premises to the
extent, if any, that Landlord is specifically obligated under this Lease to
supply the same, then Minimum Annual Rental and (subject to the balance of this
Article 30) Additional Rent shall be reduced and abated after the
expiration of the Eligibility Period for such time as the Premises or such
portion thereof remain untenantable and are not used by Tenant, in the
proportion that the rentable area of the portion of the Premises rendered
untenantable and not used by Tenant bears to the total rentable area of the
Premises.” (Def. COE Ex. A, Lease, §
30.)
Defendant has presented evidence showing that it did not prohibit
Plaintiff’s access to the premises, which would otherwise constitute a
circumstance for abatement under this section.
(Def. COE Ex. A, Lease, § 30; Def. COE Ex. R, Alexander Dep., pp.
60:6-19 [during the closure orders, employees of Plaintiff checked on premises],
61:3-10 [employees conducted these checks once a week or every other week, on
average], 61:19-24 [Defendant did not restrict Plaintiff’s access to the
premises].)
Further, Defendant has presented evidence and argument to show
that the force majeure clause does not require the abatement of rent. The force majeure clause states as follows:
“Neither [Defendant] nor [Plaintiff] shall be liable for any failure to comply
or delay in complying with its obligations hereunder if such failure or delay
is due to acts of God, inability to obtain labor, strikes, lockouts, lack of
materials, governmental restrictions, enemy actions, war, terrorism,
bioterrorism, civil commotion, fire, earthquake, unavoidable casualty or other
similar causes beyond the reasonable control of the party obligated for
performance (all of which events are herein referred to as force majeure
events). . . . . In no event shall failure to pay rent or other
sums due hereunder from one party to the other be excused as a result of any
force majeure event.” (Def. COE Ex. A,
Lease, § 40.9 [emphasis added].)
This clause expressly provides that, to the extent that the government
closure orders constituted a force majeure event, Plaintiff’s obligation to pay
rent shall not be excused. (Ibid.) Thus, even if the government orders issued in
response to COVID-19 could be considered a force majeure event under the Lease,
the language of the parties’ agreement (1) does not obligate Defendant to abate
the rent in any amount, and (2) does not excuse Plaintiff from its obligations
to pay rent.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to whether Defendant was required to
abate rent under the Lease.
As set forth above, section 30 provides that rent shall be reduced
and abated if the premises are rendered untenable and not used by Plaintiff for
the period of five consecutive business days or 10 days in a 12-month period as
a result of “lack of reasonable access to the Premises….” (Def. COE Ex. A, Lease, § 30.) Plaintiff contends that this section requires
the abatement of rent because (1) Plaintiff was denied “reasonable access” to
the Premises since its employees and customers could not access the property
pursuant to the government orders; (2) Plaintiff had no access to the premises
from at least March 16, 2020 through April 10, 2020; and (3) Defendant denied
access to the premises on at least once occasion.
The court finds that this evidence is insufficient to show the
existence of a triable issue of material fact as to whether Defendant was
required to abate the rent due under the Lease based on lack of reasonable
acess to the premises.
First, the court finds that Plaintiff has not met its burden to
show that the government mandates that its employees and customers stay at home
constituted a denial of reasonable access to the premises. In its moving and reply papers, Defendant
cites to authority defining “access” to mean physical access to, or ingress and
egress to, property. (Council of San
Benito County Governments v. Hollister Inn, Inc. (2012) 209 Cal.App.4th
473, 489 [stating that, as to Code of Civil Procedure section 1240.350,
“‘Access may refer to ‘a way by which a thing or place may be approached or
reached’”]; Bacich v. Board of Control of California (1943) 23 Cal.2d
343, 349-350 [defining property right of access of an owner of property
abutting upon a public street “as an easement of ingress and egress to and from
his property”].) Plaintiff cites to
various executive orders which mandated the closure of gyms and fitness centers
to the public or requiring individuals to stay home except to access essential
businesses. (Pl. COE, Ex. 24, ¶ 7
[ordering gyms and fitness centers to be closed to the public], Ex. 26A,
¶ 3, subd. (h)(ii) [ordering continued closure of gyms and fitness
centers].) However, the evidence cited
by Plaintiff did not prevent access to its premises, specifically, and instead
only generally precluded the operation of gyms and fitness centers. Thus, Plaintiff has not shown that it was
denied reasonable access to the premises based on these orders.
Second, the court finds that Plaintiff has not met its burden to
show that its inability to operate its business under the government orders
during the period of time between March 16, 2020 through April 10, 2020
constitutes a denial of access to the premises for the same reasons set forth
above.
Third, the court finds that Plaintiff has not met its burden to
show that Defendant denied Plaintiff reasonable access to the property. Plaintiff submits evidence establishing that
on April 7, 2020, Defendant’s security personnel denied access to an employee
who was attempting to check on the premises for Plaintiff. (Alexander Decl., ¶ 52; Pl. COE Ex. 15
[April 7, 2020 email from Alexander to Matt Montgomery advising that security
would not let Plaintiff’s “VP” in].)
However, section 30 provides for the abatement of rent if the premises
were not used by Plaintiff “for a period of at least five (5) consecutive
business days or ten (10) business days in any twelve (12) month period” as a
result of the lack of reasonable access to the premises. (Def. COE Ex. A, Lease, § 30.) Plaintiff has provided evidence showing that
Defendant denied access to the premises on only one occasion. However, pursuant to section 30, the denial
of reasonable access to the premises on one day or for any period of time less
than five consecutive business days or ten business days in a 12-month period
does not require the proportional abatement of rent. Thus, this evidence is insufficient to show a
triable issue of material fact exists as to whether Plaintiff was denied
reasonable access to the premises such that Plaintiff would be entitled to
abatement of rent under section 30 of the Lease.
H. Conclusion
Finally, Plaintiff requests judicial declarations that it may
recover its reasonable attorney’s fees and costs and may recover other relief
deemed just and reasonable. (Compl.,
¶ 101, subds. (h), (i).) However,
these requests do not concern proper subjects for declaratory relief.
The court has found, as set forth above, that Plaintiff has not
met its burden of showing that there exists a triable issue of material fact as
to the declarations requested in its sixth cause of action for declaratory
judgment.
The court therefore grants Defendant’s motion for summary
adjudication as to Plaintiff’s sixth cause of action for declaratory judgment.
2. First
Cause of Action for Breach of Lease—Breach of Landlord’s Representations
“[T]he elements of a cause of action for breach of contract are
(1) the existence of the contract, (2) plaintiff’s performance or excuse for
nonperformance, (3) defendant’s breach, and (4) the resulting damages to the
plaintiff.” (Oasis West Realty, LLC
v. Goldman (2011) 51 Cal.4th 811, 821.) Plaintiff alleges that Defendant “is in breach
of the representations, warranties, and covenants” set forth in the Lease, and
specifically, the provisions that provide that (1) Plaintiff shall have the
right throughout the term of the Lease to use the premises, or any portion
thereof, and operate its business from the premises; (2) Plaintiff shall
quietly enjoy and possess the premises; and (3) Plaintiff’s use of the premises
shall be free and clear of any conditions or restrictions which might prevent
or adversely affect its use of the premises.
(Compl., ¶ 60.)
The court finds that Defendant has met its burden of showing that
the first cause of action for breach of lease—breach of landlord’s
representations has no merit because Defendant has shown that an element of the
cause of action (Defendant’s breach of the Lease) cannot be established.
First, Defendant has met its burden of showing that it did not
breach the provisions of the Lease entitling Plaintiff (1) to use the premises
and operate its business there, and (2) to quietly enjoy and possess the
premises.
The Lease provides as follows:
“[Defendant] agrees that [Plaintiff], upon paying the rent and
performing each of the covenants, agreements and conditions of this Lease
required to be performed by [Plaintiff], shall lawfully and quietly hold,
occupy, and enjoy the Premises during the Term without hindrance or molestation
of anyone lawfully claiming by, through or under [Defendant], subject, however,
to the provisions set forth in this Lease.”
(Def. COE Ex. A, Lease, § 15.)
Defendant presents evidence showing that (1) Defendant did not, after
the government authorities issued restrictions in response to COVID-19, take
any action to restrict Plaintiff’s access to the premises, including by
erecting barriers to entry, changing the locks, or restricting Plaintiff’s
ability to enter the premises; (2) Defendant has not interfered with
Plaintiff’s business operations, including by attempting to remove Plaintiff’s
equipment, furniture, or other property located on the premises; and (3)
Plaintiff’s employees have not stated that Defendant “had ever done anything to
restrict [Plaintiff’s] access to the premises[.]” (Montgomery Decl., ¶¶ 17-18; Def. COE Ex. R,
Alexander Dep., pp. 60:6-10, 61:19-24.)
Moreover, Plaintiff has alleged that it ceased its operations in
response to the closure orders issued by the government, and not Defendant. (Compl., ¶¶ 26, 29-32.)
Second, Defendant has met its burden of showing that it did not
breach the provision of the Lease warranting that the premises are clear of all
restrictions which may prevent or affect the use of the premises by Plaintiff.
The Lease provides that Defendant warrants to Plaintiff that it
“has good and insurable title to the Project and Premises in fee simple, free
and clear of all tenancies, covenants, conditions, restrictions, liens,
encumbrances and easements which may prevent or materially adversely affect the
improvement and use of the Premises…by [Plaintiff] for the Permitted
Use….” (Def. COE Ex. A, § 36.1, subd.
(b).) Defendant presents evidence
establishing that no third party “has made any type of property right claim
adverse to [Defendant’s] ownership of the Premises” and no documents have been
recorded that would affect its title.
(Montgomery Decl., ¶ 19.) Further,
Plaintiff has not notified Defendant of any defect in Defendant’s title other
than in relation to COVID-19. (Ibid.)
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of Defendant’s breach
of the contract.
Plaintiff does not separately address this cause of action in its
memorandum of points and authorities in opposition to Defendant’s motion. Instead, Plaintiff has generally set forth
arguments regarding whether its performance under the Lease (i.e., the
obligation to pay rent) was excused or requires the abatement of rent. In the separate statement, Plaintiff appears
to argue that Defendant breached the provisions set forth above based on (1)
Defendant’s denial of access to Plaintiff on one occasion, and (2) the argument
that Defendant did not have title and ownership to the premises that was free
and clear of all restrictions throughout the closure period. (Response to Def. Material Fact Nos. 4-5.)
First, the court finds that the evidence showing that Defendant’s
security personnel denied access to Plaintiff on one occasion is insufficient
to show a triable issue of material fact as to whether Defendant hindered
Plaintiff’s use and enjoyment of the property.
As set forth above, Plaintiff has presented evidence showing that, on
April 7, 2020, one of Plaintiff’s employees “attempted to check on the
premises, but [Defendant’s] security personnel would not permit access.” (Alexander Decl., ¶ 52.) Plaintiff does not submit evidence (1)
explaining whether its subsequent email requesting assistance to Defendant went
unanswered, (2) establishing that this employee was not permitted to access the
premises upon speaking with Defendant, or (3) establishing that Defendant had,
at any other time, prevented Plaintiff from using the premises. Instead, Plaintiff has only shown that there
was one instance in which a security guard did not permit an employee
inside. “[I]n order to avert summary
judgment the plaintiff must produce substantial responsive evidence sufficient
to establish a triable issue of material act on the merits of the defendant’s
showing.” (Sangster v. Paetkau (1998)
68 Cal.App.4th 151, 162-163.) The court
finds that Plaintiff has not met its burden to “produce substantial responsive
evidence” as to whether Defendant breached the Lease by hindering Plaintiff’s
use of the premises.
Second, Plaintiff has not presented meaningful argument, nor
pointed to any authority, showing that the restriction on its operations
pursuant to the government closure orders clouded Defendant’s title or
otherwise impacted Defendant’s title within the meaning of section 36.1 of the
Lease.
The court therefore grants Defendant’s motion for summary
adjudication as to the first cause of action for breach of lease—breach of
landlord’s representations, warranties, and covenants.
3. Second
Cause of Action for Breach of Lease—Failure to Provide Credit
“[T]he elements of a cause of action for breach of contract are
(1) the existence of the contract, (2) plaintiff’s performance or excuse for
nonperformance, (3) defendant’s breach, and (4) the resulting damages to the
plaintiff.” (Oasis West Realty, LLC,
supra, 51 Cal.4th at p. 821.) In
connection with this cause of action, Plaintiff alleges that (1) “Defendant is
in breach of the Lease for failing to provide a credit to [Plaintiff] for Rent
paid during the Closure Period[,]” (2) it is entitled to a credit for rent
“paid during the Closure Period in accordance with the Lease including, without
limitation, Civil Code [section] 1511(1), and under the circumstances,” and (3)
Plaintiff has been damaged due to Defendant’s “failure to allow Plaintiff a
credit for Rent paid during the Closure Period, and to proportionately abate
Rent….” (Compl., ¶¶ 66, 69, 70.)
The court finds that Defendant has met its burden of showing that
the second cause of action for breach of lease—failure to provide no credit has
no merit because Defendant has shown that an element of the cause of action
(Defendant’s breach of the Lease) cannot be established.
First, to the extent that Plaintiff bases this cause of action on
the ground that its performance was excused pursuant to Civil Code section
1511, Defendant has met its burden to show that such a theory is without merit
because, as set forth above, Defendant has produced evidence showing that this statute
is inapplicable and does not excuse Plaintiff’s performance of its obligation
to pay rent. Second, Defendant has
shown, for the reasons set forth above, that the other asserted doctrines of
frustration of purpose, impossibility, and impracticability do not excuse
Plaintiff from its obligation to pay rent to Defendant and therefore has shown
that Plaintiff is not entitled to a credit for rent paid during the closure
periods. Third, Defendant has presented
evidence showing that the Lease does not require Defendant to abate rent based
on the government closure orders. (Compl.,
¶ 70 [Defendant damaged Plaintiff by (1) failing to allow Plaintiff a
credit, and (2) failing to proportionately abate Rent].) Specifically, Defendant has presented evidence
showing that it did not prohibit Plaintiff’s access to the premises, which
would otherwise constitute a circumstance for abatement under section 30 of the
Lease, as set forth more fully in connection with the discussion on the sixth
cause of action. (Def. COE Ex. A, Lease,
§ 30; Def. COE Ex. R, Alexander Dep., pp. 101:10-13, 60:6-19, 61:3-10,
61:19-24.)
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of Defendant’s breach
of the contract because, as set forth above, Plaintiff has not met its burden
to show that a triable issue of material fact exists as to (1) the
applicability of Civil Code section 1511 so as to require the abatement of
rent, or (2) whether the Lease requires the abatement of rent due to the
government closure orders pursuant to the doctrines of impossibility,
impracticability, and frustration of purpose.
The court therefore grants Defendant’s motion for summary
adjudication as to the second cause of action for breach of lease—failure to
provide credit.
4. Third
Cause of Action for Breach of Lease—Failure to Excuse Rent
“[T]he elements of a cause of action for breach of contract are
(1) the existence of the contract, (2) plaintiff’s performance or excuse for
nonperformance, (3) defendant’s breach, and (4) the resulting damages to the
plaintiff.” (Oasis West Realty, LLC,
supra, 51 Cal.4th at p. 821.)
Plaintiff alleges that “Defendant is in breach of the Lease for
demanding Rent and late fees during the Closure Period, and not proportionately
abating Rent during the time period the On-Going Restrictions are in
effect.” (Compl., ¶ 73.)
The court finds that Defendant has met its burden of showing that
the third cause of action for breach of lease—failure to excuse rent has no
merit because Defendant has shown that an element of the cause of action
(Defendant’s breach of the Lease) cannot be established. As set forth in connection with the second
cause of action for failure to provide credit, Defendant has presented evidence
showing that (1) the Lease set forth specific, defined circumstances in which
abatement was required, and (2) none of those expressly defined conditions
occurred and required Defendant to abate Plaintiff’s rent.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of Defendant’s breach
of the contract because Plaintiff has not met its burden of producing evidence
to show a triable issue of material fact exists as to whether (1) Civil Code
section 1511 excused its obligation to pay rent or Defendant was required to
excuse payment of rent under other circumstances, or (2) Defendant was required
to proportionately abate rent.
The court therefore grants Defendant’s motion for summary
adjudication as to the third cause of action for breach of lease—failure to
excuse rent.
5. Fourth
Cause of Action for Common Count—Monies Had and Received
A cause of action for money had and received “is viable wherever
one person has received money which belongs to another, and which in equity and
good conscience should be paid over to the latter.” (Avidor v. Sutter’s Place, Inc. (2013)
212 Cal.App.4th 1439, 1454 [internal quotations omitted].) “[T]he plaintiff must prove that the
defendant received money intended to be used for the benefit of [the
plaintiff], that the money was not used for the plaintiff’s benefit, and that
the defendant has not given the money to the plaintiff.” (Ibid. [internal quotations omitted].)
Plaintiff alleges that Defendant became
indebted to and received money that belongs to Plaintiff by (1) improperly
charging and receiving rent during the closure period, (2) refusing to provide
a credit to Plaintiff for rent paid during the closure period, and (3) refusing
to prorate rent during the time period in which the ongoing restrictions were
in place. (Compl., ¶ 81.)
The court finds that Defendant has met its burden of showing that
the fourth cause of action for common count—monies had and received has no
merit because Defendant has shown that an element of the cause of action (Defendant’s
receipt of money that belongs to Plaintiff) cannot be established. As set forth above, Defendant has produced
evidence showing that Plaintiff was not excused from its obligation to pay
Defendant rent, and therefore Defendant (1) did not improperly charge or
receive rent, (2) was not required to provide a credit to Plaintiff for rent
paid during the closure period, and (3) was not required to prorate or abate
rent during that time period.
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of Defendant’s
receipt of money that belongs to Plaintiff.
As set forth above, Plaintiff has not met its burden to show that Defendant
(1) improperly charged and received rent, (2) improperly refused to provide
Plaintiff a credit for rent paid, or (3) improperly refused to prorate
rent.
The court therefore grants Defendant’s motion for summary
adjudication as to the fourth cause of action for common count—monies had and
received.
6. Fifth
Cause of Action for Common Count—Monies Paid by Mistake
“[M]oney paid under a mistake of fact may be recovered back,
however negligent the party paying may have been in making the mistake, unless
the payment has caused such a change in the position of the other party that it
would be unjust to require him to refund.”
(Doyle v. Matheron (1957) 148 Cal.App.2d 521, 522-523.)
The court finds that Defendant has met its burden of showing that
the fifth cause of action for common count—monies paid by mistake has no merit
because Defendant has shown that an element of the cause of action (Plaintiff’s
payment of money to Defendant by mistake) cannot be established. Defendant has produced evidence showing that
Plaintiff paid rent and other charges owing under the Lease “under
protest.” First, Plaintiff’s person most
qualified testified that Plaintiff paid all rent under the Lease, “a portion of
which was paid under protest with full reservation of rights because it was not
owed.” (Def. COE Ex. R, Alexander Dep.,
p. 68:10-17.) Second, in its discovery
responses, Plaintiff stated that Plaintiff “paid rent, under protest, reserving
all rights.” (Def. COE Ex. X, pp.
2:8-10, 3:6-7.) The court therefore
finds that Defendant has met its burden to produce evidence showing that the
money paid by Plaintiff was not “under a mistake of fact” since Plaintiff had
always maintained that the amounts paid were not due. (Doyle, supra, 148 Cal.App.2d
at p. 522-523.)
The court finds that Plaintiff has not met its burden to show that
a triable issue of material fact exists as to the element of Plaintiff’s
payment of money to Defendant under a mistake of fact because Plaintiff has
confirmed that it paid all rent to Defendant with the belief that its payment
of rent was not required. In its
separate statement, Plaintiff expressly states that it “paid all rent and other
charges under protest, reserving all rights.”
(Pl. Response to Def. Material Fact No. 31.) Moreover, Plaintiff’s Director of Lease
Administration, Vice President, and Senior Real Estate Counsel has stated that
Plaintiff paid the rent demanded by Defendant “under protest” and “with a full
reservation of rights….” (Alexander
Decl., ¶¶ 38, 40-46, 48.)
The court therefore grants Defendant’s motion for summary
adjudication as to the fifth cause of action for common counts—monies paid by
mistake.
7. Conclusion
Because the court has granted summary adjudication on each cause
of action alleged by Plaintiff in its Complaint, the court finds that all of
the papers submitted show that there is no triable issue as to any material
fact and that Defendant is entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd.
(c).) The court therefore grants
Defendant’s motion for summary judgment on Plaintiff’s Complaint.
ORDER
The court grants defendant Wedge Office, LLC’s motion for summary
judgment on plaintiff Fitness International, LLC’s Complaint.
The court orders defendant Wedge Office, LLC to prepare, serve, and
lodge a proposed judgment no later than 10 days from the date of service of
this order.
The court sets an Order to Show Cause re entry of judgment for hearing
on _________, 2023, at 11:00 a.m., in Department 53.
The court orders defendant Wedge Office, LLC to give notice of this
ruling.
IT IS SO ORDERED.
DATED:
_____________________________
Robert
B. Broadbelt III
Judge
of the Superior Court