Judge: Teresa A. Beaudet, Case: 24STCV00905, Date: 2024-10-31 Tentative Ruling

Case Number: 24STCV00905    Hearing Date: October 31, 2024    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

Background

Plaintiff Bruce Cislini (“Plaintiff”) filed this action on January 12, 2024 against Defendants Cathy Gardner, Dennis Gardner, The Gardner Family Trust Dated May 5, 2008, Keller Williams Beach Cities, and Alexis Balner Hsu. The Complaint alleges causes of action for (1) violation of Los Angeles Municipal Code section 151.9, (2) breach of covenant of good faith and fair dealing, (3) breach of covenant of quiet enjoyment of the premises, (4) fraud, and

(5) negligent hiring, supervision and retention.

            In the Complaint, Plaintiff alleges, inter alia, that “Defendants Cathy and Dennis Gardner own, through their family trust (defendant Gardner Family Trust Dated May 5, 2008) (collectively ‘Landlord’), a parcel of real property commonly known as 209 Montreal Street, Playa Del Rey, California, 16 90293 (the ‘Property’).” (Compl., ¶ 9.) “On or about December 15, 2019, Plaintiff entered into a lease agreement with Landlord to rent the Property for a period of one year at a monthly rental rate of $7,500.00…” (Compl., ¶ 10.) “In addition, Plaintiff paid Landlord a $7,500.00…security deposit.” (Compl., ¶ 10.)

            Plaintiff alleges that “beginning in or about June 2023, defendant Keller Williams Beach Cities…through its agent defendant Alexis Bainer Hsu (‘Hsu’), began misrepresenting to Landlord that Plaintiff intended to move out of the Property and further mis-representing that if Plaintiff did move out Landlord might not be able to find suitable tenants and that they should instead sell the Property.” (Compl., ¶ 11.) “On or about June 20, 2023, defendant Hsu sent a text message to Plaintiff in which she stated that she was providing Plaintiff with a 30 day-notice to quit at the direction of Landlord. Two days later Hsu let herself into the Property without giving any notice and posted a 30-day notice to quit on the door. Plaintiff was surprised by this information and contacted the Landlord to find out why he was being forced to vacate the Property. Landlord initially informed Plaintiff that he could stay as long as he liked and agreed to a new lease until October 31, 2023. Hsu failed to send the lease for several weeks and continued to pressure the owners to sell the Property. Finally, Hsu did send a lease to Plaintiff but shortly thereafter served him with another 60-day notice to quit. Plaintiff contacted Landlord several times and even offered to buy the Property rather than be forced to move out but ultimately was unable to secure any form of agreement with either Landlord or Hsu…Plaintiff reluctantly vacated the Property on October 3, 2023. After Plaintiff vacated, Landlord failed to return the $7,500.00…security deposit or send a list of any itemized deductions being withheld by Landlord.” (Compl., ¶¶ 12-13.)

            On April 2, 2024, Defendants Alexis Balner Hsu and Beach Cities RE, Inc. d.b.a. Keller Williams Beach Cities (“KWBC”) filed an answer to the Complaint.

            KWBC now moves for leave to file a cross-complaint. The motion is unopposed.

Discussion

Pursuant to Code of Civil Procedure section 428.50, subdivision (a), “[a] party shall file a cross-complaint against any of the parties who filed the complaint or cross-complaint against him or her before or at the same time as the answer to the complaint or cross-complaint.” Pursuant to Code of Civil Procedure section 428.50, subdivision (b), “[a]ny other cross-complaint may be filed at any time before the court has set a date for trial.” Pursuant to Code of Civil Procedure section 428.50, subdivision (c), “[a] party shall obtain leave of court to file any cross-complaint except one filed within the time specified in subdivision (a) or (b). Leave may be granted in the interest of justice at any time during the course of the action.”

Pursuant to Code of Civil Procedure section 426.50, “[a] party who fails to plead a cause of action subject to the requirements of this article, whether through oversight, inadvertence, mistake, neglect, or other cause, may apply to the court for leave to amend his pleading, or to file a cross-complaint, to assert such cause at any time during the course of the action. The court, after notice to the adverse party, shall grant, upon such terms as may be just to the parties, leave to amend the pleading, or to file the cross-complaint, to assert such cause if the party who failed to plead the cause acted in good faith. This subdivision shall be liberally construed to avoid forfeiture of causes of action.” “A policy of liberal construction of¿¿section 426.50¿¿to avoid forfeiture of causes of action is imposed on the trial¿court. A motion to file a cross-complaint at any time during the course of the action must be granted unless bad faith of the moving party is demonstrated where forfeiture would otherwise result. Factors such as oversight, inadvertence, neglect, mistake or other cause, are insufficient grounds to deny the motion unless accompanied by bad faith.” (¿Silver Orgs. v. Frank (1990) 217 Cal.App.3d 94, 98-99¿.)  

KWBC’s counsel attaches as Exhibit 3 to his supporting declaration a copy of the proposed cross-complaint. (Haven Decl., ¶ 10, Ex. 3.) The proposed cross-complaint is by Cross-Complainant KWBC against Cross-Defendant Southbay Passive Income, Inc. d.b.a. Keller Williams South Bay. (Ibid.) The proposed Cross-Complaint alleges causes of action for

(1) equitable indemnity and/or contribution, (2) express or implied contractual indemnity and/or contribution, (3) apportionment of fault, and (4) declaratory relief. (Ibid.)

            The proposed cross-complaint alleges, inter alia, that “[t]he Action arises out of the Plaintiff’s residential lease, and the named defendants are the asserted landlords and/or property owners, real estate agent Alexis Balner Hsu, and real estate broker KWBC. Among other things, the complaint alleges, on information and belief, that ‘beginning in or about June 2023, defendant Keller Williams Beach Cities [KWBC], through its agent defendant Alexis Bainer Hsu (‘Hsu’),’ began making certain alleged misrepresentations to the landlord regarding Plaintiff’s move out and/or the landlord’s ability to find suitable tenants…The complaint also asserts a cause of action against KWBC for alleged negligent hiring, supervision, and/or retention. In support of this claim, the complaint alleges that KWBC breached alleged duties of supervision, etc…From on or about July 7, 2022, to November 1, 2023, however, Hsu was affiliated with KWSB. During the time alleged in the Action complaint, ‘beginning in or about June 2023,’ Hsu was not with KWBC.” (Haven Decl., ¶ 10, Ex. 3, ¶¶ 6-7, emphasis omitted.)

            In his supporting declaration, KWBC’s counsel states that mediation was scheduled in this action for July 24, 2024, and that “[o]n June 25, 2024, while I was preparing for the mediation, I realized that the allegations in the complaint – namely that Hsu was affiliated with KWBC during the alleged period in 2023 – were incorrect. Publicly available on-line records with the Department of Real Estate (DRE) indicated that, on July 7, 2022, Ms. Hsu left KWBC and moved and transferred her salesperson license to [Southbay Passive Income, Inc. d.b.a. Keller Williams South Bay (‘KWSB’)], where she remained until November 1, 2023.” (Haven Decl., ¶¶ 5-6.) Plaintiff’s counsel attaches as Exhibit 1 to his declaration a “copy of Ms. Hsu’s on-line DRA record information.” (Haven Decl., ¶ 6, Ex. 1.) KWBC’s counsel states that “[m]y initial confusion as to the issue was caused, in large part, by lease forms created by Ms. Hsu, which forms contained footer references to KWBC, even though Ms. Hsu had transferred and moved to KWSB. Attached hereto as Exhibit 2 are true and correct copies of two of these real estate lease forms…” (Haven Decl., ¶ 6.)  

            KWBC asserts that “[t]he cross-complaint is clearly related to the claims in the underlying complaint,” that “[t]here is no bad faith,” and that “[l]aw and policy mandate that leave be granted.” (Mot. at p. 7:19-21.)

Based on the foregoing, and in light of the lack of any opposition, the Court finds that KWBC has demonstrated good cause to file the proposed cross-complaint.  

Conclusion

Based on the foregoing, KWBC’s motion for leave to file a cross-complaint is granted. The Court orders the KWBC to file and serve the proposed cross-complaint within 3 days of the date of this Order. KWBC is ordered to give notice of this Order. 

DATED:  October 31, 2024                     ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court