Judge: Stephen P. Pfahler, Case: 20CHCV00472, Date: 2023-04-20 Tentative Ruling

Case Number: 20CHCV00472    Hearing Date: April 20, 2023    Dept: F49

Dept. F-49                                                          

Date: 4-20-23

Case # 20CHCV00472

Trial Date: 7-24-23 c/f 1-23-23

FURTHER INTERROGATORIES

MOVING PARTY: Defendant, Tul-Anthony Limited

RESPONDING PARTY: Plaintiff, Tasha Realty, Inc.

RELIEF REQUESTED

Motion to Compel Further Responses to Special Interrogatories (set one)

SUMMARY OF ACTION

Plaintiff Tasha Realty, Inc. alleges defendants Balboa Plaza, LLC, Tul-Anthony Limited, and the Stelmach parties, own certain commercial property in Chatsworth. In October 2019, Michael Hasim, primary shareholder of the business entity identified as Plaintiff, entered into a contract for the purchase of the premises.

Escrow closed on March 2020 for an ultimate purchase price of $8.4 million. Prior to the close, on February 18, 2020, defendants provided an estoppel certificate for the 99 Cents Only tenant, with the remainder of the certificates executed by defendant Stelmach. Upon assuming possession of the property, Plaintiff discovered alleged misrepresentations in the  Stelmach executed certificates, such as concealed, unlicensed/illegal alterations to the premises, and fraudulent rental agreements/rental payments with certain tenants.

On August 13, 2020, Plaintiff filed a complaint for Breach of Contract, Fraud and Unjust Enrichment. On August 16, 2021, Plaintiff filed a first amended complaint for Breach of Contract and Fraud – Intentional Misrepresentation. Plaintiff filed a first amended complaint on August 16, 2021 for Breach of Contract and Actual Fraud/Intentional Misrepresentation.

RULING: Granted in Part/Denied in Part.

Defendant, Tul-Anthony Limited moves to compel further responses to Special Interrogatories (set one), numbers 9, 22, 23, 26, 29, 30, 31 and 32 from plaintiff Tasha Realty, Inc. The requests seek the identification of all tenants, rents received from said tenants, Covid relief loan information from any government agency, and the capitalization rate. Plaintiff objected on grounds of relevance and privacy, including third party privacy. Defendant in reply emphasizes the relevance of the requests, and contends the supplemental requests remain defective.

The motion was timely filed less than 45 days from the October 10, 2022, date of service of the responses.

Defendant challenges the validity of the objections, including good cause for seeking the information on the basis of defenses, such as mitigation, as well as the lack of any privacy rights for a corporate entity. Plaintiff in opposition contends the arguments “mischaracterize” the case brought against defendants, and reiterates the basis of the fraud claims arising from the presentation of false presale data. Plaintiff further contends the motion constitutes an effort to invade the financial privacy of Plaintiff, and a form of general harassment.

“But ‘[f]or discovery purposes, information is relevant if it “might reasonably assist a party in evaluating the case, preparing for trial, or facilitating settlement….” [Citation.] Admissibility is not the test and information, unless privileged, is discoverable if it might reasonably lead to admissible evidence. [Citation.] These rules are applied liberally in favor of discovery [citation], and (contrary to popular belief), fishing expeditions are permissible in some cases. [Citation.]’ (Citations.)” (Cruz v. Superior Court (2004) 121 Cal.App.4th 646, 653–654.)

Defendant seeks information regarding the subject property transaction. The amount of rent received directly relates to the claims of an inflated valuation of the property based at least in part on rent projections. Plaintiff strenuously objects on grounds that the complaint is NOT based on rent estimations, but a more specific claim regarding the “vacancy rate” at the time of the sale.

The court cannot determine a material distinction between a claim arising from estoppel certificates and the damages sought from the diminished rent. [First Amend. Comp., ¶¶ 23, 36.] Regardless, Plaintiff at least somewhat concedes to the merits of the argument in representing service of supplemental responses to numbers 9, 22 and 23, following service of the motion, but no proof of service of further responses to numbers 26, 29, 30, 31 and 32. [Declaration of Joseph Brown, Ex. A.]

"Whether a particular response does resolve satisfactorily the issues raised by a motion is a matter best determined by the trial court in the exercise of its discretion, based on the circumstances of the case. In many cases involving untimely responses, the propounding party will take the motion off calendar or narrow its scope to the issue of sanctions. If the propounding party proceeds with the motion, however, the trial court has the discretion to rule on the motion. The trial court might compel responses without objection if it finds no legally valid responses have been provided to one or more interrogatories; it might deny the motion to compel responses as essentially unnecessary, in whole or in part, and just impose sanctions; it might treat the motion as one under section 2030.300 and either determine that further answers are required, or order the propounding party to “meet and confer” (§ 2030.300, subd. (b)) and file a separate statement (Cal. Rules of Court, rule 3.1020(a)(2), (c)); or it might take the motion off calendar, thereby requiring the propounding party to file a motion under section 2030.300."

(Sinaiko Healthcare Consulting, Inc. v. Pacific Healthcare Consultants (2007) 148 Cal.App.4th 390, 408–409.)

The court accepts the represented service of the supplemental responses, as acknowledged by Defendant. The responses preserve the objections, but also provide additional information non-privileged information directly responsive to the requests. In context of the privacy objections addressed below, the court finds the supplemental responses sufficient for purposes of the subject motion. Other than a conclusion in the reply regarding the insufficiency of the supplemental responses, the court finds no substantive supporting argument.

Nevertheless, the court finds insufficient justification on the relevance objections for the remaining items. The court therefore grants the motion to compel further responses of non-privileged information to numbers 26, 29, 30, 31 and 32.

As for the privacy objection, the parties agree that the corporate entity lacks any basis to assert any privacy objection. The court therefore overrules any privacy objections on behalf of the corporate entity. (SCC Acquisitions, Inc. v. Superior Court (2015) 243 Cal.App.4th 741, 755.) The motion, separate statement, opposition and opposing separate statement otherwise lack any substantive address of the potential third party or individual privacy objections. The court declines to make the arguments regarding the validity of the privacy objection; an order compelling interest to overcome the objection, if applicable as to any non-corporate entities; and/or, potential solutions for addressing third party privacy concerns. (Williams v. Superior Court (2017) 3 Cal.5th 531, 557; Pioneer Electronics (USA), Inc. v. Sup. Ct. (2007) 40 Cal.4th 360, 374-375; Los Angeles Gay & Lesbian Center v. Superior Court (2011) 194 Cal.App.4th 288, 307, 311; Belaire-West Landscape, Inc. v. Sup. Ct. (2007) 149 Cal.App.4th 554, 561-562.) Notwithstanding, given the supplemental responses, the court deems this portion of the motion moot as well.

The motion is therefore denied in part as to numbers 9, 22 and 23, based on service of sufficient supplemental responses, and the lack of sufficient address regarding the insufficiency of said responses. The motion lacks sufficient address of the third party privacy objections, and therefore denied on this basis. Again, the motion is granted on grounds that the relevance objection is overruled as to numbers 26, 29, 30, 31 and 32. Plaintiff is ordered to serve code compliant supplemental responses without relevance objections within 15 days of this order.

Court policy generally allows for the imposition of sanctions against parties only providing supplemental responses following the filing of a motion. While it’s not clear how much the motion prompted the supplemental responses and/or whether the subject motion was required rather than solved with a better meet and confer effort, the remaining outstanding responses justify sanctions. The court accordingly awards Defendant $500 in sanctions joint and several against Plaintiff and payable within 30 days.

Three motions for judgment on the pleadings set for June 1, 5 and 12, 2023, respectively. Trial also remains set for July 24, 2023.

Moving party to give notice.