Judge: Shirley K. Watkins, Case: BC685113, Date: 2022-12-16 Tentative Ruling

Case Number: BC685113    Hearing Date: December 16, 2022    Dept: T

            [TENTATIVE] ORDER:  Defendant Meir Isaacs’ Motion for Summary Judgment is DENIED.

Defendant Meir Isaacs’ Motion for Summary Adjudication is DENIED as to Issues 1, 2, 4 and 7-8; and GRANTED as to Issues 3, 5 & 6.

Introduction

            Defendant Meir Isaacs (Defendant) moved for summary judgment (MSJ) or alternatively for summary adjudication (MSA) against Plaintiff Robert Gasparian (Gasparian) and Sarkis Akopyan’s (Akopyan) First Amended Complaint[1] (FAC) (lead case no. BC685113) and against Plaintiff Beauty Star Enterprise, Inc. (Beauty Star) and A1 Palliative and Hospice Care, Inc.’s (A1) Complaint (consolidated case no. 19VECV00489.)  (Gasparian, Akopyan, Beauty Star, and A1 collectively, Plaintiffs.)  Defendant’s MSA presented eight issues to be adjudicated.  MSA Issue 1 moved against the entirety of both actions.  MSA Issues 2-6 moved against the six causes of action (COA) alleged in Gasparian and Akopyan’s FAC.  MSA Issues 7 & 8 moved against the second COA for premises liability and third COA for breach of contract alleged in Beauty Star and A1’s Complaint.

            The Court notes that Plaintiff Nationwide Mutual Insurance Company’s (consolidated case no. 19VECV01548) Complaint is not at issue in the MSJ/MSA.

            Discussion 

            As to the MSJ and MSA Issue 1 and 7, Defendant placed into issue all Plaintiffs’ negligence-based claims, which include Gasparian/Akopyan’s first thru third COAs for negligence, gross negligence, and negligent entrustment and Beauty Star/A1’s first and second COAs for negligence and premise liability.  Defendant argued that there is no triable issue of fact as to the defense of waiver because all parties’ leases’ contained release and/or indemnification provisions.  (Defendant’s Separate Statement of Fact (DSSF) 22[2]-27.) 

Defendant’s reliance on Section 14.C of Gasparian, Beauty Star, and A1’s leases (not Akopyan’s lease) does not provide an affirmative defense to the entirety of the negligence-based claims because the release is limited to the “…property loss, property damage, or personal injury to the extent covered by insurance… .”  (hereinafter, Release Provision.) (DSSF 22 and 27.)  The Release Provision is insufficient to show release of all damages incurred by Plaintiffs because of the language limiting the scope to property damages.  Further, if insurance was obtained by the tenants, it is unclear if the property damages they suffered are within such insurance limits or exceed the insurance limits.   There is also no evidence as to the amount of property damages suffered by Plaintiffs.  Without evidence showing Plaintiffs entire damages suffered being limited to property damage and the scope of insurance coverage, the argument contains an inherent triable issue of fact.  As argued by Plaintiffs, they asserted other damages outside of property damage.  Further, Section 14.C. is only included in the leases entered by Gasparian, Beauty Touch-Nails-Brides, A1, Beauty Touch – Hair, Crystal Blue (Defendant’s Exhs. 5, 7-10.)  Beauty Touch-Nails-Brides, Beauty Touch – Hair, and Crystal Blue are businesses owned by Beauty Star.  Because there are triable issues as to scope and amount of damages, Defendant’s argument relying upon the Waiver Provision in the leases (except as to Akopyan’s lease,) is not persuasive.

Akopyan’s lease included an Insurance and Indemnity Provision instead of the above referenced Release Provision.  (DSSF 23 and 25-26 and Exh. 6 at Par. 11.)  Subsection 11(c) is a “Waiver of Subrogation” provision.  (DSSF 23.)  Defendant’s reliance upon this subsection suffers the same limiting language as the above Release Provision because it is limited to property loss or damages covered by insurance.  Without a showing that Akopyan’s damages are limited to property damage and also covered by insurance, Defendant’s argument contains an inherent triable issue of fact.  Subsection 11(d) is the “Hold Harmless” subsection. (DSSF 25.)  This provision required Akopyan to indemnify and hold Defendant harmless from claims arising from Akopyan’s use or occupation of the premise or from the conduct of its business or from activity, work, or things which may be permitted or suffered by Akopyan in or about the premise.  Akopyan assumed the risk of damage to property in or about the premise and waives all claims to such claims.  However, this action is not based upon Akopyan’s damages from use/occupation of his leased premise of the strip mall.  The origination of the fire is alleged to have been in a portion of the strip mall outside Akopyan’s leased premise.  Because there are facts, presented by Defendant, that the fire originated outside of Akopyan’s leased premise, there is a triable issue of fact as to whether the Hold Harmless subsection applies.  Defendant’s reliance upon this provision is insufficient to meet Defendant’s initial burden of proof on the motion. 

Subsection 11(e) is the “Exemption of Landlord from Liability” subsection.  (Exemption Provision.)  (DSSF 26.)  This subsection provided a release from “any injuries” to Akopyan’s property, business, or loss of income and includes injuries caused by defects/conditions from “portions of the building in which the Premises are a part, or from any other sources or places.”  The Exemption Provision would apply to the fire at issue in this action in that it originated outside of Akopyan’s leased premise and damaged Akopyan, inclusive all types of damages.  At least, as to Akopyan lease, Defendant’s citation Subsection 11(e) appears to provide a defense to Akopyan’s negligence-based claims and the granting of Defendant’s MSA limited solely to Akopyan’s negligence-based claims. 

To raise a triable issue of fact, Akopyan argued that the Exemption Provision expressly excepts “Landlord’s willful or grossly negligent conduct.”  Gross negligence is defined as:  “Gross negligence is the lack of any care or an extreme departure from what a reasonably careful person would do in the same situation to prevent harm to oneself or to others.”  (CACI 425.)”  Akopyan argued that Defendant was grossly negligent in knowingly leasing a unit in the strip mall to an illegal marijuana growing operations. Akopyan asserted that Defendant leased unit 13649 to World Work Solutions, Inc., which operated an illegal marijuana growing operation, and that Defendant knew of the marijuana growing operation.  (Plaintiff’s Dispute of Defendant’s Facts (PDDF) 28.)  (The Court notes that Unit 13649 was also leased to Crystal Blue, a dba of Beauty Star.  However, this fact is irrelevant to the discussion as to gross negligence.)  Defendant’s evidence shows that illegal marijuana growing operations occupied several units of Defendant’s building.  (See Defendant’s Exh. 3: Los Angeles Fire Dept. Fire Investigation Report.)  Knowingly renting a space for unlawful manufacture of a controlled substance is punishable by imprisonment for not more than a year.  (Health & Saf. Code sec. 11366.5.) Because knowingly renting to a marijuana growing operation is a crime, Akopyan provided facts to show a potential triable issue as to gross negligence. 

An inherent issue to the above issue on gross negligence is the fire’s alleged origination point.  Defendant’s Separate Statement provided that the fire started in Unit 13645B (aka Unit 13645 ½) due to an electrical overload from an illegal marijuana grow operation (DSSF 2, 3, 30, 31, 38, 39, 71, and 72.)  However, Defendant’s evidence, the fire department investigation report (Defendant’s Exh. 3,) does not support the contention that the fire started “in Unit 13645B.”  The fire department only opined that the fire started “in the attic directly above a unit which was illegally converted to a marijuana grow operation” and due to an “electrical overload.”  The report further noted that several units in the building had illegal grow operations.  The report also stated that it was confirmed that “the electrical had been illegally tampered with throughout the structure.”  The report only lists Unit 13647 as the incident address/location.  The report does not reference Unit 13645B.  The report is unclear as to which of the illegal marijuana growing operations was below the fire origination point.  Because there is evidence that Defendant had knowledge that marijuana was being illegally grown in at least of the units on his property, an inference can be made that the fire could have originated from or been caused by the illegal marijuana growing operation that Defendant had knowledge of, creating a triable issue of fact. 

            Akopyan also argued that his lease expired in 2008 to argue the above provisions are unenforceable.  However, holdover tenants continue in possession under the same terms of the written lease.  Akopyan’s argument as to expiration of his lease is unpersuasive.

            Defendant’s MSJ and MSA Issues 1 and 7 are DENIED.

As to MSA Issue 2, 4 and 8, Defendant placed into issue Gasparian and Akopyan’s second COA for gross negligence and fourth COA for trespass to land and Beauty Star/A1’s third COA for breach of contract.  In broad terms, Defendant argued that there is no triable issue of fact as to these claims because Defendant did not breach his duty or that it was Plaintiff Beauty Star’s duty to maintain the electrical system because Beauty Star leased Unit 13645B. 

Defendant argued that his sole responsibility in maintaining the building was limited to the roof, foundation and structural components, and exterior walls.  (DSSF 33-35, 41-44, 69, and 73.)  Defendant argued that it was the tenants’ responsibility to maintain the electrical systems.  (DSSF 33-34.)  Because Beauty Star leased Unit 13645B, Defendant argued that it was Beauty Star’s obligation to maintain the electrical system.  Defendant places liability at Beauty Star’s doorstep because Defendant argued that the fire started in Unit 13645B (DSSF 2, 3, 30, 31, 38, 39, 71, and 72).  Defendant’s argument that it was Beauty Star’s responsibility to maintain the electrical system is unpersuasive because the undisputed evidence does not establish as a matter of law that the fire did or did not originate in Unit 13645B.  Because Defendant’s evidence provided that the fire started in the attic, it is unclear whether the duty of maintenance lies with the landlord or the tenant, creating a triable issue of fact.  Insufficient facts are provided to show if the attic area and the wires in the attic are part of the leased premise or not.  Insufficient facts are provided to show if the wires in the attic supplied electricity to only the leased premises or supplied electricity to common areas.  Beauty Star/A1 argued that Defendant was responsible for common area Water and Power Bills (PDDF 34.)  These issues, with the submitted evidence or lack thereof, present triable issues of fact regarding Defendant’s breach, or lack thereof. 

Defendant’s MSA as to Issues 2, 4, and 8 is DENIED.

            As to MSA Issue 3, Defendant placed into issue Gasparian/Akopyan’s third COA for negligent entrustment.  The only fact presented to support Defendant’s MSA is that Beauty Star’s lease for “Beauty Touch-Nails-Brides” limited the use of the premise to bridal hair and makeup.  (DSSF 36: Exh. 7.)  Defendant argued that the leasing of commercial property is not a dangerous instrumentality.  However, Gasparian/Akopyan argued that the leasing activity placed Plaintiffs’ safety at risk.  However, Plaintiffs’ safety is not the element placed into issue by the motion.  Plaintiffs further argued that the dangerous instrument was Defendant’s consent given to other tenants to change an electrical sub-panel.  However, giving consent is not an instrumentality.  Consent is not a thing or chattel that has an inherent dangerous propensity.  Because Gasparian/Akopyan cannot show a triable issue of fact as to a dangerous instrumentality, there is no triable issue of material fact as to the negligent entrustment COA.

            Defendant’s MSA Issue 3 is GRANTED.

As to MSA Issues 5 and 6, Defendant placed into issue Gasparian and Akopyan’s fraud-based claims – their FAC’s fifth and sixth COAs for negligent and intentional misrepresentation.  Defendant argued that there is no triable issue of fact because there is no evidence as to any representation made by Defendant.  Gasparian/Akopyan’s FAC alleged that Defendant misrepresentations as to the safety of the electrical system and the legality of marijuana growing operations at the property.  Defendant provided evidence showing that Gasparian could not recall the contents of conversations with Defendant regarding the marijuana smell and Akopyan did not discuss the marijuana smell with Defendant. (DSSF 46-49.)  Defendant’s citation to evidence shows that Gasparian/Akopyan lack evidence regarding the alleged misrepresentations.  Defendant met his initial burden on Issues 5 and 6 and the burden transferred to Gasparian/Akopyan.  Gasparian/Akopyan’s opposition failed to present any evidence or argument as to these two issues.  Gasparian/Akopyan’s separate statement disputed DSSF 46-49, however, the evidence cited by Gasparian/Akopyan related to Defendant’s knowledge of the marijuana growing business in units that are alleged to be separate from the area where the fire originated.  Gasparian/Akopyan’s evidence did not address the element of fraud being placed into issue that there is a lack of evidence showing Defendant making a misrepresentation as to electrical system or the legality of the marijuana growing operations.  Because Gasparian/Akopyan’s disputed facts do not show a triable issue of fact as to whether Defendant made misrepresentations, Gasparian/Akopyan failed to meet their burden of proof. 

            Defendant’s MSA Issue 5 & 6 is GRANTED.