Judge Theresa M. Traber, Case BC715362 2023-01-27 Tentative Ruling

MOVING PARTY: Plaintiffs and Cross-Defendants Vichit, Sudatip, and Somsak Tilakamonkul

RESPONDING PARTY(S): Defendant and Cross-Complainant T-Team Investment, LLC.

This is a dispute involving a partnership in which Plaintiffs sought to quiet title, dissolve a partnership, and partition and sell the partnership property, among other causes of action. Plaintiffs’ Second Amended Complaint asserts claims for quiet title, breach of oral contract, negligence, partnership accounting, partnership dissolution and accounting, partition and sale of partnership property, breach of fiduciary duty, and breach of the covenant of good faith and fair dealing.

In its Second Amended Cross-Complaint, T-Team Investments, LLC asserts causes of action for declaratory relief, quiet title, breach of contract, account stated, and goods and services rendered.

Plaintiffs and Cross-Defendants move for summary adjudication on the fourth, fifth, seventh, and eighth causes of action in the Second Amended Cross-Complaint (SAXC.)

Plaintiffs request that the Court take judicial notice of (1) the Second Amended Cross-Complaint in this action; (2) the Court’s June 30, 2022 statement of decision and September 1, 2022 Amendment to Statement of Decision; (3) Official Los Angeles County Recorder record No. 20071236815, Grant Deed from T-Team to Somsak Tilakamonkul, recorded 5/22/2007; (4) Official Los Angeles County Recorder record No. 20071424017, Trust Deed on 4201 Ransom Street, Long Beach, CA, signed by Somsak Tilakamonkul, recorded 6/13/2007; (5) Statement of Trial Testimony of Virut and Narlong Tilakamonkul filed in this case on 4/1/2022; (6) Trial exhibit No. 43 in this case; (7) Trial Exhibit No. 333 in this case; (8) Corporations Code sections 17343(a)(1) and (3); (9) The answers of Cross-Defendants Vichit, Sudatip, and Somsak Tilakamonkul to the Second Amended Cross-Complaint; (10) Official San Diego County Recorder record No. 2006-0612507, Grant Deed to Virut Tilakamonkul on 4941 Mt. Bigelow, San Diego, CA., filed on 8/28/2006; (11) Trial Exhibit No. 304 in this case; (12) Trial Exhibit No. 307 in this case; and (13) Defendants’ opposition to Plaintiff’s ex parte application to continue Temporary Restraining Order filed on 08/01/2022.

Plaintiffs’ Requests Nos. 1 and 2 are GRANTED pursuant to Evidence Code section 452(d) (court records). The remainder of Plaintiffs’ requests are DENIED as irrelevant to the Court’s ruling. (Gbur v. Cohen (1979) 93 Cal.App.3d 296, 301 (“[J]udicial notice . . . is always confined to those matters which are relevant to the issue at hand.”].)

Cross-Complainant objects to the Declaration of Vichit Tilakamonkul in Support of Plaintiffs’ Reply brief. As the Court does not rely on this declaration in reaching its decision on these issues, the Court declines to rule on Cross-Complainant’s objections. (Code Civ. Proc. § 437c(q).)

Cross-Defendants filed a document with their reply brief entitled “Separate Statement of Moving Parties Response to Opposition to Plaintiffs’ Motion for Summary Adjudication.” This document is not authorized by the Code of Civil Procedure or the California Rules of Court. (Code Civ. Proc. § 437c; Cal. Rules of Court Rule 3.1350.) The Court therefore refuses to consider this document.

On July 25, 2018, Plaintiff Vichit Tilakamonkul (Vichit)[1] filed a verified complaint for damages and other relief against Defendants Vichai Tilakamonkul, Virut Tilakamonkul, Somsak Tilakamonkul, Marasri (Mary) Tilakamonkul, Narong Tilakamonkun, Sumeth Tilakamonkul,[2] and others claiming an interest in certain described real and personal property. In the initial complaint, Vichit asserted claims for breach of written contract, partnership accounting, dissolution of partnership and accounting, conversion, breach of fiduciary duty, constructive fraud, and partition and sale and accounting.

After several revised iterations of the complaint, the Second Amended Complaint was filed on August 21, 2019, which was the operative complaint at trial. In that pleading, Vichit Tilakamonkul joined with brother and former defendant, Somsak Tilakamonkul (jointly "Plaintiffs") to assert twelve causes of action against their brothers, Defendants Vichai, Virut, Narlong, Sumeth, and Pramorte, as well as Siriratn Tilakamonkul and several entities owned by some or all of the seven Tilakamonkul brothers. These entity defendants included Royal Thai Cuisine II, Inc. ("RT II"), Royal Thai Cuisine IV, Inc. ("RT IV"), and T-Team Investments, LLC. ("T-Team"). The Second Amended Complaint asserted claims for quiet title, breach of oral contract, negligence, partnership accounting, partnership dissolution and accounting, partition and sale of partnership property, breach of fiduciary duty, and breach of the covenant of good faith and fair dealing.

Various defendants filed Cross-complaints in the action. By the time of trial. there were three at issue. In its Second Amended Cross-Complaint, filed on March 25, 2021, Defendant T-Team sues Plaintiffs Vichit and Somsak, as well as Sudatip Tilakamonkul, who is also known as Dawn Tilakamonkul, alleging causes of action for declaratory relief, quiet title, breach of contract, account stated, and goods and services rendered. T-Team's cross-complaint focuses on the ownership of real property located at 4941 Mount Bigelow in San Diego ("Mt. Bigelow Property") and at 4199 and 4201 Ransom Street in Long Beach ("Ransom Properties"), and the related issue of whether funds paid to Vichit in 2007 constituted a buyout of his interest or a loan still owed by Vichit to T-Team. RT II intervened in the action on or about March 12, 2019 to bring a claim for declaratory relief against Plaintiffs, seeking a judgment regarding the ownership of the Royal Thai Cuisine restaurant in Newport Beach. Further, Defendants Vichai, Virut, Narlong and Sumeth cross-complained against Plaintiffs for declaratory relief on June 30, 2018, requesting a declaration that Plaintiffs own no part of the restaurant businesses or real property they claim to own jointly with the five defendant brothers.

On October 1, 2020, the Court bifurcated trial in this matter and ordered that the following equitable causes of action in the Second Amended Complaint would be tried first to the Court: (1) quiet title, (8) partnership accounting, (9) partnership dissolution and accounting, (10) partition and sale of partnership property, and (11) breach of fiduciary duty. (10/1/20 Order, p. 10.) In addition, the Court ordered that the following equitable causes of action in the Second Amended Cross-Complaint would be tried in the first-phase bench trial: the first, third and sixth causes of action for declaratory relief and the second cause of action for quiet title. The Court ordered that all other causes of action would be tried in a second phase, with the legal claims being tried to a jury along with an intertwined equitable cause of action that would be tried to the Court.

At the close of the first phase of trial, the Court issued its statement of decision, finding that Plaintiffs did not establish that RT II, RT IV, or RT V are partnerships, but rather that the evidence shows they are and have been properly functioning corporations, duly organized under the laws of the state. (Amended Statement of Decision.) The Court therefore declined to address Plaintiffs’ contentions that they suffered damages because of their partners’ alleged breaches of fiduciary duty. (Id.)

The Court also concluded that Plaintiffs demonstrated by clear and convincing evidence that the Ransom and Mt. Bigelow properties were “jointly owned by all seven brothers until their transfer to T-Team, which has been jointly owned by all seven brothers,” but not that they possessed any ownership share in the Georgia Sue property, which has been continuously owned by Sumeth and Virut alone. (Original Final Statement of Decision.) The Court modified its statement of decision in this respect on October 11, 2022 to clarify that each of the seven brothers owns a beneficial interest in the Ransom and Mt. Bigelow properties and that they are each entitled to a one-seventh share of these properties. (Amended Statement of Decision; see RJN Exh. B.)

The Court denied Defendants’ request for declaratory relief to the effect that Vichit’s interest in the family business was bought out in 2007 and that Somsak’s ownership rights were terminated in 2014 because of his wife Pankee’s alleged misappropriation of corporate funds. (Amended Statement of Decision.) The Court also rejected Defendants’ affirmative defenses based on statute of limitations, laches, estoppel, and unclean hands, finding that the facts did not support the application of these defenses. (Id.)

Plaintiffs now move for summary adjudication on the fourth, fifth, seventh, and eighth causes of action in the Second Amended Cross-Complaint prior to commencement of the second phase of trial.

The function of a motion for summary judgment or adjudication is to allow a determination as to whether an opposing party can show evidentiary support for a pleading or claim and, if not, to enable an order of summary dismissal without the need for trial. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) Code of Civil Procedure Section 437c(c) “requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.) “The function of the pleadings in a motion for summary judgment is to delimit the scope of the issues; the function of the affidavits or declarations is to disclose whether there is any triable issue of fact within the issues delimited by the pleadings.” (Juge v. County of Sacramento (1993) 12 Cal.App.4th 59, 67, citing FPI Development, Inc. v. Nakashima (1991) 231 Cal. App. 3d 367, 381-82.)

As to each claim as framed by the complaint, the (cross-)defendant moving for summary judgment must satisfy the initial burden of proof by presenting facts to negate an essential element, or to establish a defense. (Code Civ Proc. § 437c(p)(2); Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520.) Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.” (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.) The lack of opposition by a plaintiff or cross-complainant is not grounds to grant a motion for summary judgment if a defendant cannot meet their initial burden of proof. (See Thatcher v. Lucy Stores, Inc. (2000) 79 Cal.App.4th 1081, 1087.)

Once the defendant has met that burden, the burden shifts to the plaintiff to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto. To establish a triable issue of material fact, the party opposing the motion must produce substantial responsive evidence. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 166.)

On December 13, 2022, this Court ruled that Cross-Complainant T-Team’s fourth cause of action for breach of contract and fifth cause of action for account stated were disposed of by the Court’s Amended Statement of Decision following the trial of the equitable claims and defenses in this action. (December 13, 2022 Minute Order.) Therefore, the only issues remaining on this motion are the seventh cause of action for breach of contract relating to the Mt. Bigelow property and the eighth cause of action for goods and services rendered.

Cross-Defendants move for summary adjudication on the seventh cause of action for breach of contract in connection with the Mt. Bigelow property.

The seventh cause of action alleges that Cross-Defendants entered into an oral contract with Cross-Complainant T-Team to rent the Mt. Bigelow property for Cross-Defendants to reside in. (SAXC ¶ 89, 91.) The Court addressed this allegation in its Amended Statement of Decision, ruling that Vichit owned a one-seventh beneficial interest in the Mt. Bigelow property. (Amended Statement of Decision p. 17.) As Cross-Complainant concedes, “[i]t is the general rule that each tenant in common has a right to occupy the common property, and, generally speaking, one such tenant cannot recover rent from the other tenant.” (Brunscher v. Reagh (1958) 164 Cal.App.2d 174, 176.) Cross-Defendants have demonstrated on this basis that Cross-Complainant cannot prevail on the seventh cause of action. The burden therefore shifts to Cross-Complainant to establish a triable issue of fact.

In opposition to this motion, Cross-Complainant contends that, although the Court ruled that Vichit held a beneficial interest in the property, he never had an interest as a tenant in common or had any right to possession of the property or any right to control it. Cross-Complainant is incorrect. The Court ruled on October 11 that each of the seven brothers had a one-seventh undivided interest in the Mt. Bigelow property. The brothers are therefore, definitionally at least tenants in common of the Mt. Bigelow property. (Civ. Code § 685.)

Cross-Complainant next argues that even if Cross-Defendants were tenants in common, Vichit can still be charged rent because he allegedly ousted Cross-Complainant by refusing to leave the property. It is true that the rule that a tenant in common cannot recover rent from another tenant in common does not apply when one cotenant wrongfully ousts another. (Brunscher, supra, 164 Cal.App.2d at 176.) However, ouster requires that another cotenant be dispossessed or excluded from the property. (See, e.g, Estate of Hughes (1992) 5 Cal.App.4th 1607, 1611-12.) Cross-Complainant’s conclusory assertion that Vichit’s refusal to leave the property constitutes an ouster, where Cross-Complainant offers no evidence nor even allegations of any dispossession of or exclusion from the property by Vichit, is not remotely sufficient to establish a triable issue of fact on this basis.

Finally, Cross-Complainant argues that Vichit could still be charged rent because he allegedly agreed, according to Cross-Complainant Virut’s declaration, to pay rent at a rate of $500 per month to occupy a room on the Mt. Bigelow property. (Declaration of Virut Tilakamonkul ISO Opp., ¶ 11.) According to Virut’s recently filed declaration, he acted with Sumeth, “on behalf of T-Team,” to reach this oral lease agreement, which was in place from September 1, 2017 through 2019 when the property was sold, but Vichit failed to pay the rent that was due. (Id., ¶¶ 11-13.) In reply, Cross-Defendants object to this declaration as improperly contradicting prior testimony to create a triable issue of fact. (See, e.g., Peach v. Monter Rainbow (1993) 12 Cal.App.4th 1441, 1451.) The Court agrees.

Virut’s recent declaration stands in sharp contrast to his testimony at trial. During trial, Virut testified that he gave “permission” for Vichit and his family to live at the Mt. Bigelow property, at a time when Virut employed Vichit as a worker at his restaurant named The Sablai Thai Kitchen. (Trial Transcript [TT] 12-15-21, pp. 49:19-50:16.) There was no mention at trial of Sumeth’s involvement in agreeing to Vichit’s residency, nor any suggestion that the deal struck with Vichit was done “on behalf of T-Team.” Nor did Virut state that Vichit assumed any obligation to pay rent. To the contrary, Virut explicitly stated that Vichit did not pay rent and that, instead, Virut’s company paid utilities for Mt. Bigelow “because Vichit live[d] there,” and that Virut considered “the payment of the utilities to be some sort of rent or compensation to T-Team because [Virut] gave Vichit permission to live there.” (Id., pp 54:16-18; 56:2-14.) This arrangement is identical to that used for employees of Royal Thai Cuisine V which paid rent on behalf of its employees who lived in the Mt. Bigelow property. (Trial Transcript [TT], 12-21-21, p. 43; Settled Statement, p. 11; TT 12-16-21, pp. 64-66; TT 12-20-21, pp. 56-57.) Virut’s trial testimony reflected an arrangement where Vichit was allowed to live at Mt. Bigelow in connection with his employment in Virut’s restaurant, which paid rent in the form of utilities to compensate T-Team for the use of Mt. Bigelow. Because no aspect of the arrangement described at trial supports the existence of a lease that imposed any rental obligation on Vichit, the Court rejects the new declaration as a sham that contradicts Virut’s prior sworn testimony. As a result, the Court concludes that Cross-Complainant has failed to satisfy its burden of demonstrating a triable issue of fact.

The Court finds, therefore, that because Cross-Defendants have established that Cross-Complainant cannot prevail on this cause of action and Cross-Complainant has failed to establish a triable issue of fact, summary adjudication is warranted on the seventh cause of action for breach of contract.

The parties agree that the eighth cause of action survives or fails with the seventh cause of action. Therefore, as the Court has concluded that summary adjudication is warranted for the seventh cause of action, summary adjudication is likewise warranted for the eighth cause of action.

For the reasons explained above, Cross-Defendants’ Motion for Summary Adjudication is GRANTED in its entirety.

[1] Most of the parties are brothers with the same or nearly identical last names. for clarity, the Court refers to each brother by his first name but means no disrespect to the parties in doing so.

[2] Where a party's name has been misspelled in an original pleading, the Court has simply corrected the spelling without restating the original misspelling to denote the name under which the party was erroneously sued.