Judge: Stephen P. Pfahler, Case: 21STCV28820, Date: 2024-08-26 Tentative Ruling

Case Number: 21STCV28820    Hearing Date: August 26, 2024    Dept: 68

Dept. 68

Date: 8-26-24

Case: 21STCV28820

Trial Date: Not Set

LEAVE TO AMEND

MOVING PARTY: Plaintiff, Ruth Wilson, et al.

RESPONDING PARTY: Defendant, Loancare, LLC

RELIEF REQUESTED

Motion for Leave to File a First Amended Complaint

SUMMARY OF ACTION

Plaintiff Ruth Lynn Wilson trustee of the Wilson Family Trust purchased 1218 Stevely Avenue, Long Beach. Servicing on the loan was ultimately assigned to Defendant Loancare, LLC, beginning on April 1, 2019.

Beginning in May 2020, Plaintiff alleges a series of false statements demanding additional payments for insurance, an escrow account, false delinquency charges, and improper credit for payments towards the loan balance. Plaintiff was unable to resolve the dispute.

On August 4, 2021, Plaintiff filed a complaint for 1. Fraud 2. Breach Of Contract 3. Breach Of Covenant Of Good Faith And Fair Dealing 4. Accounting 5. Violation Of Business, and Professions Code Sections 17200, Et Seq. Defendant answered on September 7, 2021.

On April 7, 2024, the assigned judicial officer recused from the action upon the substitution of new defense counsel into the case. The case was reassigned to Department 68 on April 12, 2024.

RULING: Granted.

Plaintiff Ruth Lynn Wilson trustee of the Wilson Family Trust moves for leave to file a first amended complaint in order to add three (3) new causes of action for 6. Elder Abuse 7. Negligent Misrepresentation and 8. Negligent Infliction Of Emotional Distress. Plaintiff also seeks to substitute in as Ruth Wilson individually rather than as trustee on behalf of the Wilson Family Trust. [Declaration of Declaration of Darren Trone, Ex. 1.]

Defendant Loancare, LLC in opposition challenges the motion as dilatory and extraordinarily prejudicial due to the addition/substitution of a new plaintiff, and three new causes of action. Defendant maintains the first motion for leave to amend was denied, notwithstanding the later minute order vacating the hearing upon the recusal of the court.

Plaintiff in reply cites to the liberal public policy favoring amended pleadings. Plaintiff counters with a claim of prejudice if leave is not granted. Plaintiff also offers a substantive legal response to the challenges against the proposed new causes of action for elder abuse, and maintains the motion compiles with California Rules of Court 3.1324.

A motion for leave to amend must comply with the requirements set forth in California Rules of Court Rule 3.1324, which states as follows:

“(a)      Contents of motion

A motion to amend a pleading before trial must:

(1)               Include a copy of the proposed amendment or amended pleading, which must be serially numbered to differentiate it from previous pleadings or amendments;

(2)               State what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph, and line number, the deleted allegations are located; and

(3)               State what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located.

(b)        Supporting declaration

A separate declaration must accompany the motion and must specify:

(1)        The effect of the amendment;

(2)        Why the amendment is necessary and proper;

(3)        When the facts giving rise to the amended allegations were discovered; and

(4)               The reasons why the request for amendment was not made

earlier…” (emphasis added).

Dilatory delays and prejudice to the opposing parties is a valid ground for denial. (Hirsa v. Superior Court (1981) 118 Cal.App.3d 486, 490.)  Prejudice exists where the amendment would require delaying the trial, resulting in loss of critical evidence, or added costs of preparation such as an increased burden of discovery. (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 486-488.)

Leave to amend is generally liberally granted. (Code Civ. Proc., § 473(a); Mesler v. Bragg Management Co. (1985) 39 Cal.3d 290, 296.) The court will not generally consider the validity of the proposed amended pleading in ruling on a motion for leave, instead deferring such determinations for a demurrer or motion to strike, unless the proposed amendment fails to state a valid claim as a matter of law. (Kittredge Sports Co. v. Sup.Ct. (Marker, U.S.A.) (1989) 213 Cal. App.3d 1045, 1048; California Casualty Gen. Ins. Co. v. Superior Court (1985) 173 Cal.App.3d 274, 280–281 disapproved of on other grounds by Kransco v. American Empire Surplus Lines Ins. Co. (2000) 23 Cal.4th 390.)

The court finds the motion sufficiently complies with the procedural requirements. On the timing, new counsel substituted into the case in November 2023. The motion for leave to amend previously filed on March 26, 2024, was vacated upon the judicial officer for Department 19 recusing from the case upon the substitution of new defense counsel into the action. The renewed motion was filed on May 16, 2024, approximately one month after reassignment of the action. The court declines to consider any prior orders (especially vacated orders), especially given the circumstances to the recusal and transfer. As presented in this court, the court finds no dilatory conduct establishing any form of prejudice. The trial date was vacated upon the transfer of the action. The cause of the transfer was the substitution of new counsel by Defendant. Plaintiff is in no way at fault for circumstances involving the substitution of defense counsel and the prior judicial officer decisions.

As for the legal challenge regarding the propriety of substituting in Wilson, an individual and removing the trust, the argument is extrinsic to the scope of consideration for a motion for leave. The court declines to rule as a matter of law to the impropriety of the requested substitution of parties. The instant motion is NO WAY governed by Code of Civil Procedure Section 473, or allows for consideration of relation back doctrine under statute of limitations, as presented in the extensive opposition. (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 408-409; Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1118; California Air Resources Bd. v. Hart (1993) 21 Cal.App.4th 289, 300; Diliberti v. Stage Call Corp. (1992) 4 Cal.App.4th 1468, 1470-1471.) Again, under the standard for LEAVE TO AMEND, the court will also NOT otherwise consider the factual sufficiency of each and every new proposed claim, including elder abuse, and negligent misrepresentation. The court finds none of the proposed changes constitute an invalid amendment as a matter of law for purposes of the subject motion.

Finally, because the changes arise from the common core of facts and only challenges the substitution of the parties, the court finds no showing of significant prejudice to Defendant. Again, the motion is in no way an “eleventh hour” request given the transfer and order vacating of all previously set dates. The case is not even at issue in this courtroom. Defendants will have sufficient time to address the claims against them. Any potential claimed prejudice insufficiently outweighs the liberal policy for leave to amend. (See Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 486-487; Hulsey v. Koehler (1990) 218 Cal.App.3d 1150, 1159.) When and how Defendant choses to respond can be addressed in due course.

The motion is therefore GRANTED. Plaintiff to file and serve a separate copy of the first amended complaint within 10 days of the order.

Plaintiff to provide notice.