Judge Teresa A. Beaudet, Case Number: 22STCV18736, Date: 2023-08-18 Tentative Ruling

On February 14, 2023, Plaintiffs filed the operative Second Amended Complaint, alleging causes of action for (1) breach of covenant of good faith and fair dealing, (2) fraud,

(3) cancellation of title, and (4) intentional interference with prospective economic advantage.

On October 5, 2023, the Court entered a Judgment of Dismissal in this action providing, inter alia, as follows:

Katt Living Trust and Marks & Associates, An Accountancy Corporation (‘Defendants’) to the Second Amended Complaint filed by plaintiffs Eugene Chorny and Irina Ermakova (‘Plaintiffs’), came on for hearing in the above-entitled court before the Honorable Teresa A. Beaudet, Judge presiding. Having read the moving, opposition, and reply papers and after oral argument, the court sustained the demurrer as to all causes of action plead against Defendants in the Second Amended Complaint, without leave to amend. THEREFORE,

1. All causes of action against Defendants in Plaintiffs’ Second Amended Complaint are hereby dismissed with prejudice. 2. Defendants shall have and recover from Plaintiffs their statutory costs and attorneys’ fees pursuant to a timely filed Memorandum of Costs and a motion for attorneys’ fees.”

In addition, on November 15, 2023, another Judgment of Dismissal was entered in this action providing, inter alia, as follows:

“[O]n April 12, 2023, the demurrer by defendants Samuel Ohana and Tamim, LLC (collectively ‘Defendants’) to the second, third and fourth causes of actions in the Second Amended Complaint filed by plaintiffs Eugene Chorny and Irina Ermakova (‘Plaintiffs’), were sustained without leave to amend, leaving only the first cause of action for breach of the covenant of good faith and fair dealing against Defendants. On October 18, 2023, the Motion for Judgment on the Pleadings (the ‘Motion’) by Defendants to the Second Amended Complaint filed by Plaintiffs, came on for hearing in the above-entitled court before the Honorable Judge Rolf Treu, Judge Presiding for Honorable Teresa A. Beaudet. Having read the moving, opposition, and reply papers, and after oral argument, the Court granted the Motion, and dismissed the first cause of action for Breach of the Implied Covenant of Good Faith and Fair Dealing in the Second Amended Complaint, without leave to amend.

1. The first cause of action for Breach of the Implied Covenant of Good Faith and Fair Dealing in the Second Amended Complaint is hereby dismissed with prejudice. 2. Plaintiffs’ Second Amended Complaint against Defendants is hereby dismissed with prejudice.”

On April 19, 2023, Ohana and Tamim (jointly, the “Cross-Complainants”) filed a Cross-Complaint against Chorny, Ermakova, and the Trust, alleging causes of action for (1) fraud,

(2) negligent misrepresentation, (3) indemnity, (4) contribution, and (5) declaratory relief. The first and second causes of action of the Cross-Complaint are alleged against Chorny and Ermakova. The third, fourth, and fifth causes of action of the Cross-Complaint are alleged against all cross-defendants.

The Trust and Marks and Associates, an Accountancy Corporation[1] (jointly, the “Demurring Parties”) now demur to the third, fourth, and fifth causes of action of the Cross-Complaint. The demurrer is unopposed.

A demurrer can be used only to challenge defects that appear on the face of the pleading under attack or from matters outside the pleading that are judicially noticeable.¿(¿Blank v. Kirwan (1985) 39 Cal.3d 311, 318¿.)¿“¿To survive a demurrer, the complaint need only allege facts sufficient to state a cause of action; each evidentiary fact that might eventually form part of the plaintiff’s proof need not be alleged.¿”¿(¿C.A. v. William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872¿.)¿For the purpose of testing the sufficiency of the cause of action, the demurrer admits the truth of all material facts properly pleaded.¿(¿Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 966-967¿.)¿A demurrer “¿does not admit contentions, deductions or conclusions of fact or law.¿”¿(¿Daar v. Yellow Cab Co. (1967) 67 Cal.2d 695, 713¿.)¿

In the Cross-Complaint, Cross-Complainants allege that in June 2005, Chorny and Ermakova (the “Lessees”) entered into a lease (the “Lease”) with the Trust to rent the property located at 13300 Burbank Blvd., Sherman Oaks, CA 91401 (the “Property”). (Cross-Compl., ¶¶ 2, 9.) The Lease was for an original term of 10 years (the “Original Term”) and contained a “First Addendum” which provided Chorny and Ermakova a right of first refusal (“ROFR”) to purchase the Property during the Original Term of the Lease. (Cross-Compl., ¶ 9.) The ROFR required Chorny and Ermakova to provide written notice of their intent to exercise their ROFR within five days of receiving a notice of sale from the Trust. (Cross-Compl., ¶ 9.)

Cross-Complainants allege that sometime in March 2021, and after the expiration of the Original Term, the Trust accepted a third party offer to purchase the Property. (Cross-Compl., ¶ 10.) On June 22, 2021, the Trust emailed Lessees and provided them with a written notice of sale and the right to match the terms of said offer within 5 days (the “Notice of Sale”). (Cross-Compl., ¶ 11.) Lessees had until June 27, 2021 (the “Deadline”) to provide written notice of their intent to purchase the Property on the same terms as set forth in the Notice of Sale. (Cross-Compl., ¶ 11.)

Cross-Complainants allege that on June 29, 2021, two days after the Deadline, Lessees declined and waived their right to exercise their right to the ROFR in writing by sending an email to the Trust that stated, “[u]nfortunately, my financial situation does not allow me to purchase the property at this time…” (Cross-Compl., ¶ 12.) Cross-Complainants further allege that after having declined the ROFR, Lessees informed Ohana about the potential sale of the Property, and asked Ohana if he would be interested in purchasing the Property with them. (Cross-Compl., ¶ 13.)

Cross-Complainants allege that thereafter, and because Lessees did not have the funds necessary to purchase the Property with Ohana, Lessees put Ohana on notice that they no longer wanted to purchase the Property. (Cross-Compl., ¶ 16.) Cross-Complainants allege that “[t]hereafter, Tamim, LLC purchased the Property without objection from the Lessees, who…at all times before and after the sale were aware that the Property was going to be and that it was ultimately sold to Tamim, LLC.” (Cross-Compl., ¶ 20.)

In the third cause of action or indemnity, Cross-Complainants allege that “[o]n or about June 8, 2022, Plaintiff and Cross-Defendants [Chorny and Ermakova] filed a complaint in the above entitled action, seeking damages against Cross-Complainants (the ‘Complaint’).” (Cross-Compl., ¶ 33.) Cross-Complainants allege that “[i]f Cross-Complainants are held liable for the claims made in the Complaint or for damages as a result of the incidents and occurrences alleged in the Complaint, Cross-Complainants’ liability would be based solely on a derivative form of liability not resulting from their conduct, but from an obligation imposed on them by law; whereas Cross-Defendants [Chorny and Ermakova] and the Trust, and each of them, were actively negligent in causing the damages, if any, and were at fault as a result of their own respective acts and/or omissions. Therefore, Cross-Complainants would be entitled to complete indemnity from cross-defendants, and each of them.” (Cross-Compl., ¶ 35.)

The Demurring Parties assert that here, “[n]o contractual relationship between the parties or law giving rise to an indemnity claim is alleged in the Cross-Complaint.” (Demurrer at p. 8:1-2.) Cross-Complainants do not oppose the demurrer and thus do not point to any such allegations. The Demurring Parties also assert that “as the claims of Plaintiffs against Cross-Complainants have all been dismissed, Cross-Complainants can no longer allege that they have been damaged, another element of the claim for indemnity. While they allege that they have incurred attorneys’ fees and costs defending the action, they do not allege a basis for a recovery of such fees and costs…” (Demurrer at p. 8:10-13.) This point is not disputed by Cross-Complainants, who, as discussed, do not oppose the demurrer.

Based on the foregoing, the Court sustains the demurrer to the third cause of action of the Cross-Complaint.

In the fourth cause of action for contribution, Cross-Complainants allege that “[i]f Cross-Complainants are held liable to Plaintiffs, or to anyone else, for damages as a result of the incidents and occurrences alleged in plaintiffs Complaint, the damages, if any, were either wholly or in part directly and proximately caused by the negligence or culpable conduct of Cross-Defendants [Chorny and Ermakova] and the Trust, and each of them. Each cross-defendant should be required to pay a share of the damages that is in proportion to the comparative negligence and responsibility of that cross-defendant in causing the damages, and should further be required to reimburse Cross-Complainants for any payment of damages they makes [sic] in excess of their proportional share, if any, of all parties’ negligence and responsibility for the damages.” (Cross-Compl., ¶ 37.)

“(a) Where a money judgment has been rendered jointly against two or more defendants in a tort action there shall be a right of contribution among them as hereinafter provided.

(b) Such right of contribution shall be administered in accordance with the principles of equity.

(c) Such right of contribution may be enforced only after one tortfeasor has, by payment, discharged the joint judgment or has paid more than his pro rata share thereof. It shall be limited to the excess so paid over the pro rata share of the person so paying and in no event shall any tortfeasor be compelled to make contribution beyond his own pro rata share of the entire judgment.” (Code Civ. Proc., § 875, subds. (a)-(c).)

The Demurring Parties note that “[t]he fourth cause of action for contribution fails to allege either that a money judgment has been rendered jointly against two or more defendants or that Cross-Complainants have paid more than their pro rata share of the judgment.” (Demurrer at p. 9:6-8.) Cross-Complainants do not oppose the demurrer and thus do not dispute this point.

Based on the foregoing, the Court sustains the demurrer to the fourth cause of action of the Cross-Complaint.

In the fifth cause of action for declaratory relief, Plaintiff alleges, inter alia, that “[a]n actual controversy exists between cross-complainants and cross-defendants, and each of them. Plaintiffs and Cross-Defendants [Chorny and Ermakova] contend that they had a ROFR to purchase the Property. Cross-Defendant the Trust claims that they gave notice to [Chorny and Ermakova] of the potential sale to Tamim, LLC and in doing so, met their contractual obligation in the Lease to provide a Notice of Sale to [Chorny and Ermakova] or that they otherwise waived their ROFR. Cross-Complainants contend that they were informed by the Cross-Defendants, and each of them, that all the prerequisites necessary to purchase the Property from the Trust and been met, including any waiver of the ROFR, Notice of Sale and/or declining the same, and that based on said representations, Cross-Complainants purchased the Property.” (Cross-Compl., ¶ 39.) Cross-Complainants further allege that “Cross-Defendants deny that if Cross-Complainants are held liable under the Complaint or for any cause of action related to their purchase of the Property, or as a result of the incidents and occurrences alleged in plaintiff’s Complaint, the liability would be based solely on a derivative form of liability not resulting from any action or omission of Cross-Complainants, but only from an obligation imposed by law; whereas Cross-Defendants, and each of them, were actively negligent and/or are at fault as a result of their own acts and/or omissions.” (Cross-Compl., ¶ 40.) Cross-Complainants “desire a judicial declaration of the rights and duties of the parties with respect to the matters alleged in [the] cross-complaint.” (Cross-Compl., ¶ 41.)

The Demurring Parties cite to The Tiburon v. Northwestern P. R. Co. (1970) 4 Cal.App.3d 160, 170, where the Court of Appeal noted that “[i]t is general rule that in an action for declaratory relief the complaint is sufficient if it sets forth facts showing the existence of an actual controversy relating to the legal rights and duties of the respective parties under a contract and requests that the rights and duties be adjudged.” With regard to the declaratory relief cause of action, the Demurring Parties assert that “[a]s the Plaintiff’s claims have been resolved in favor of both Cross-Complainants and Cross-Defendants, and no showing is made in the Cross-Complaint that Cross-Complainants have any independent claim against Cross-Defendants, the cause of action fails to state facts showing an actual controversy involving justiciable questions relating to the rights or obligations of a party.” (Demurrer at p. 10:12-16.) Cross-Complainants do not oppose the demurrer and thus do not dispute this point.

Based on the foregoing, the Court sustains the demurrer to the fifth cause of action of the Cross-Complaint.

Based on the foregoing, the Demurring Parties’ demurrer to the third, fourth, and fifth causes of action of the Cross-Complaint is sustained, with leave to amend.

The Court orders Cross-Complainants to file and serve an amended cross-complaint, if any, within 20 days of the date of this order. If no amended cross-complaint is filed within 20 days, the Court orders the Demurring Parties to file and serve a proposed judgment of dismissal within 30 days of the date of this order.¿

[1]The Court notes that Marks and Associates, an Accountancy Corporation does not appear to be named as a cross-defendant in the Cross-Complaint.

EUGENE CHORNY, et al., Plaintiffs, vs. SAMUEL OHANA, et al., Defendants.	Case No.:	22STCV18736
	Hearing Date:	March 20, 2024
	Hearing Time: 2:00 p.m. [TENTATIVE] ORDER RE: DEMURRER BY DEFENDANTS THE BARBARA WILLA JOHANNA KATT LIVING TRUST AND MARKS & ASSOCIATES, AN ACCOUNTANCY CORPORATION, TO CROSS-COMPLAINT OF DEFENDANTS SAMUEL OHANA AND TAMIM, LLC
AND RELATED CROSS-ACTION

Superior Court of California

County of Los Angeles

Department 50