Case Number: 20STCV33044    Hearing Date: March 7, 2023    Dept: 73

MYRA L. WEISS v. MAPLE & VAIL LLC

Counsel for Plaintiff/opposing party: 

Counsel for Defendant/moving party: 

MOTION FOR SUMMARY ADJUDICATION (filed 12/16/2022)

TENTATIVE RULING

Discussion

Plaintiff Myra L. Weiss filed this action on August 31, 2020. This action arises from four properties in Montebello, CA, two on Maple Street and another two on South Vail Street (the “Maple Vail Properties.”) Abe Michlin (deceased) had four children and, during his lifetime, conveyed title in the Maple Vail Properties to his four children as tenants in common. (Complaint, ¶¶ 11-12). One of the siblings sold his interest to the remaining siblings, such that the remaining three siblings each have an undivided one-third interest in the Maple Vail Properties as tenants in common. (Complaint, ¶ 13). The three siblings who own the Maple Vail Properties are [the parties to this action are both bolded/italicized in this section for ease of reference]:

·         Plaintiff Myra Weiss (1/3 interest in Maple Vail Properties): She brings this action:

o   Individually: She alleges the second and third causes of action in her individual capacity.

o   As Trustee: She alleges the first, fourth, fifth, and sixth causes of action in her capacity as trustee of the David E. Weiss Family Revocable Living Trust Dated 3/14/1997 (the “Weiss Trust”) (which holds a 1/3 ownership interest in the Maple Vail Properties).

·         Defendant Sybil Flom (1/3 interest in Maple Vail Properties)

o   Trustee: She is the trustee of the Sybil Flom Trust Dated 10/31/2007 (the “Flom Trust”), which holds a 1/3 ownership interest in the Maple Vail Properties.

o   Mother to Defendant Noah Flom: Noah Flom has no interest in the properties, individually, but is the trustee of the SF-Apex Trust (“SF-Apex”) and is an agent/controls Defendant Maple & Vail, LLC, which manages the Maple Vail Properties. When referred collectively, the “Flom Defendants.”

·         Defendant Bernard Michlin (1/3 interest in Maple Vail Properties)

o   Trustee: He is the trustee of the Bernard A. Michlin Trust, dated June 28, 2010 (the “Michlin Trust”), which holds a 1/3 ownership interest in the Maple Vail Properties.

Plaintiff, 77, generally alleges that Noah Flom has repeatedly made attempts to have Plaintiff and Michlin transfer their interests in the Maple Vail Properties to Maple & Vail, LLC (unsuccessfully). Plaintiff alleges that the Flom Defendants have used funds derived from the rents of the Maple Vail Properties to pay for the attorney’s fees incurred to create Maple & Vail LLC and for other expenses solely benefitting the Flom Defendants without Plaintiff’s consent. (FAC ¶ 26). Further, Plaintiff alleges that the Flom Defendants have collected rents, but refused to raise rents to fair market value to allow for certain employees to occupy the premises and/or to store industrial drums belonging to their business without payment. (FAC, ¶ 29). They have also refused to account for rents and profits (including renting out one of the properties for filming, but not sharing/accounting the $25,000 N. Flom received with the owners). (FAC ¶ 30.).

The First Amended Complaint alleges the following causes of action: (1) Partition of Real Property by Sale (against Sybil and Bernard); (2) Financial Abuse [W&I Code § 15610.07(a)(3)] (against Flom Defendants); (3) Pain and Mental Suffering Elder Abuse [W&I Code § 15610.07(a)(1)] (against Flom Defendants); and (4) Unjust Enrichment (against Flom Defendants).  On June 11, 2021, the Court sustained Defendants demurrer to the third cause of action without leave to amend.

On January 14, 2021, Defendant Bernard A. Michlin, individually and as trustee of The Bernard A. Michlin Trust Dated June 28, 2010, filed a cross-complaint against Maple & Vail LLC, Noah N. Flom, individually and as trustee of the SF-APEX Trust, Sybil M. Flom, individually and as trustee of the Sybil Flom Trust, Apex Drum Company Inc., and Myra L. Weiss, individually and as trustee of the David E. Weiss Family Revocable Living Trust.

On December 7, 2021, the Court granted Myra and Bernard’s motion to bifurcate the Partition causes of action from all other causes of action in the FAC. Trial of the Partition causes of action is set for March 8, 2022.

On November 4, 2022, Myra filed a motion for summary adjudication as to the following Affirmative Defenses contained in the Answers filed by the Sybil Flom, Noah Flom, Maple & Vail LLC (“M&V”), and Apex Drum Company, Inc. (collectively, “Flom Defendants”): (1) Sixth Affirmative Defense (Estoppel); (2) Seventh Affirmative Defense (Waiver); (3) Eighth Affirmative Defense (Laches); and (4) Ninth Affirmative Defense (Unclean Hands).

On January 19, 2023, the Court continued this motion and allowed Defendants to submit supplemental briefing solely about the $225,000 unclean hands issue.

On November 4, 2022, Myra filed the motion for summary adjudication as to the four affirmative defenses, arguing:

·         Defendants’ boilerplate affirmative defenses are defective as a matter of law and, when given an opportunity to substantiate them with facts, Defendants have failed to do so. The Affirmative Defenses contain no facts whatsoever, thus they are defective on their face.

o   Defendants failed to substantiate their affirmative defenses with a statement of facts. In response to Form Interrogatories, Defendants’ objected to discovery responses asking for “facts supporting your affirmative defenses.” (Owens Decl. ¶ 3, Ex. 2 [Form Interrogatorry 15.1.].) Plaintiff argues that she can rely on this factually devoid discovery response to meet plaintiff’s initial burden and to shift the burden.

·         There is no evidence that Myra ever made a valid waiver of her statutory right to partition the Properties.

o   There is no evidence of an express waiver. No express waiver was ever made. (Myra Decl. ¶¶ 2-11; David Decl. ¶¶ 12-14; Owens Decl. ¶ 6, Ex. 5 [Sybil Depo. 23:5-23, 31:17-22, 59:12-22].)

o   There is no evidence to support an implied waiver of Myra’s right to partition.

§  Here, Noah testified that he could not recall seeing any lease for Apex Drum on the Maple Vail Properties since the Lease signed in 1985. (Owens Decl. ¶ 7, Ex. 6 [Noah Depo. 251:24-25, 252:1-4, 258:14-17].)

§  This 2020 Lease is not an “implied waiver” because (1) Myra was not informed and did not approve of such a lease; and (2) Myra was not and has never been a member of Maple & Vail LLC (the “Lessor”) or an owner of Apex Drum (the “Tenant”). (Myra Decl. ¶¶ 8-9; David Decl. ¶¶ 12, 15, 16.)

§  No long-term lease agreement was ever made between the cotenants and Apex Drum. (Myra Decl. ¶¶ 8, 9; David Decl. ¶¶ 12, 15, 16.)

·         There are no facts to support the sixth affirmative defense of estoppel.

o   The Joint Statement regarding the Partition trial submitted on April 23, 2022, concedes that “Defendants Noah and Maple and Vail, LLC are not involved in the partition action, as neither of them own any interest in the properties. Further, Sybil cannot raise the defense that she is losing income from the operations of Apex Drum. (Owens Decl. ¶ 9, Ex. 8.)

o   Sybil has testified that historically the home of Apex Drum has always been located at 6170-6176-6202-6226 Ferguson Drive in the City of Commerce, California, not on these two lots in Montebello, and the cutting, grinding, cleaning, painting of the plastic drums takes place at Ferguson, not Montabello. (Owens Decl. ¶ 6, Ex. 5. [Sybil Decl. 122:14-22, 56:12-57:1-4, 58:22-24, 59:4-6].) Thus, there is no evidence that Apex Drum will go out of business if the Maple Vail Properties are partitioned.

o   No facts exist that Myra is estopped.

·         There are no facts to support the affirmative defense of laches.

o   UNDISPUTED: In 2018, Sybil continued to send Myra rent that was due from Apex Drum. (UMF No. 22.) There were numerous discussions throughout 2018 regarding issues with management of the Properties. (UMF No. 23.) These discussions continued throughout 2019. (UMF No. 24-25.)

o   In order to establish laches, the party must show: 1) an omission to assert a right; 2) a delay in the assertion of the right for some appreciable period; and 3) circumstances which would cause prejudice to an adverse party if assertion of the right is permitted. (Stafford v. California Canning Peach Growers (1938) 11 Cal.2d 212.)

o   There are no facts showing that Myra’s omission to assert her right to partition, that Myra delayed in asserting the right for an appreciable period, and circumstances would cause prejudice to Sybil if the right is permitted.

o   There was no delay in asserting Myra’s right to partition. In late 2018, Noah began to try to acquire Myra and Bernard’s title to the Maple Vail Properties, and started to form M&V. (Owens Decl. ¶ 17, Ex. 16.) This continued in 2019, where Bernard was urging Myra to sign a grant deed transferring her interest. (Myra Decl. ¶¶ 13-15.)  It was not until June 23, 2020 family meeting that Myra becamse convinced that it would not be possible to come to a mutually satisfactory resolution of the issues involving Maple Vail Properties. (Myra Decl. ¶ 14, 18.) The lawsuit was filed two months after. (Myra Decl. ¶ 15.)

o   Sybil is not prejudiced (the other Defendants lack standing). It is Sybil’s burden to demonstrate prejudice. The real estate has increased in the passage of time from $1.632 million in March 2017 to $4,831,540 in January 25, 2022 for the Vail Properties, and $886,000 in March 2017 to $4,186.420 in January 2022. (Weiss Decl. ¶¶ 7-9, Exs. B-D.)

·         The unclean hands affirmative defense is without merit

o   Defendants have been unable to produce any evidence of “unclean hands.”

§  They allege that David, almost eight years ago, received a $20,000 fee from life insurance proceeds. This fee was suggested and discussed with Sybil’s CPA. (Weiss Decl. ¶ 17.) They also complain that David took a short term loan from a bank account, which he repaid in full in four months, and then repaid in full 11 months later. (David Decl. ¶¶ 18-23.)

§  These incidents have nothing to do with the real property at issue in this case. IT is not “directly related” the partition cause of action.

In opposition filed on 1/9/23, and the supplemental briefing on the unclean hands issue, filed on 2/27/23, Flom Defendants argue that:

·         Plaintiff never demurred or requested Defendants to amend their answer. Plaintiff agreed not to demur to demur to a similar answer filed by Apex Drum Company when Plaintiff added it as a party. (Eisemann Decl. Exhibit 42.) Plaintiff agreed that Apex Drum would not need to allege any facts in its assertion of its affirmative defenses.

·         Plaintiff waited more than a year to serve Form Interrogatories, and then denied Defendants request for additional time to respond. Defendants argue that they were forced to let their objections stand, after Plaintiff’s counsel failed to respond sixteen hours later after Plaintiff’s counsel made the initial request for an extension. (Eisemann Decl. Ex. 46.) Plaintiff then filed the response eight days after the initial response deadline.

·         The cause of action for estoppel is applicable.

o   Noah Flom invested millions of dollars in Apex Drum because of his expectation that plaintiff would continue the decades-long practice of allowing the family business to continue operating on the Maple and Vail Properties. (Noah Decl. ¶¶ 6-7.) Noah changed his life plans to return to carry on the family business, which he did for twenty years, generating income by paying rent which has been distributed to Myra, Bernard, and Sybil. (Noah Decl. ¶ 4, Sybil Decl. ¶ 5, 24-25.)

§  Sybil’s 20% interest in Apex Drum will be significantly impacted on destroying the business that she spent years of her life managing.

·         Waiver is a valid defense.

o   This is a question of fact. To permit partition would frustrate the very purpose for which the land was acquired by the investors. “Courts have held that there may be an implied waiver of the right to partition based on an implied agreement to postpone partition when partition would defeat the purpose for which the parties acquired the property. (American Medical International v. Feller (1976) 59 Cal.App.3d 1008, 1013.)

o   Sybil stated in her declaration that her parents “purchased the land on which Apex Drum stores its inventory of drums . . . specifically so that Apex Drum could run its business by storing its inventory there.” Sybil Decl. ¶ 2.

o   Myra implicitly relinquished or waived her right to seek partition. (Sybil Decl. (1/5/23) ¶¶ 5, 26, 28; Sybil Decl. (7/27/22) (Eisemann Decl. Exh. 54) ¶¶ 17, 23, 24, 26; Noah Decl. ¶¶ 4-7; Eisemann Decl. Exh. 14, 26, 27, 32, 33, 36, 37, 38, 39, 40, 41, 50, 51, 53, 58, 59; Myra Arb. Tr. (Eisemann Decl. Exh. 4) at 736:9-737:9, 742:13-16; Noah Arb. Tr. (Eisemann Decl. Exh. 4) at 662:14-664:20, 666:20-667:1.)

o   Myra agreed with Noah that if her daughter could obtain a long-term lease, then she would agree to transfer her interest in M&V. (Eisemann Decl. Ex. 3 [352:25-255:1].) This never happened.

o   Myra implicitly agreed that Maple and Vail Properties would not be sold as long as Apex Drum continued to operate. Myra implicitly agreed that Apex Drum could operate by accepting benefits of it paying rent, which was distributed to her. (Sybil Decl. ¶¶ 26, 28.)

o   The parties conduct evinced a waiver of any right they had to partition and to obtain a sale outside of the family. Myra had agreed to sell her interest in the properties to Sybil. (Exhibits 14, 26, 27, Sybil Decl ¶ 48.)

·         Laches is a valid defense.

o   Noah took steps in reliance on the implied agreement that Apex Drum would be allowed to continue operating on the property. Had they initiated this partition action earlier, Noah would not have had such detrimental reliance.

o   Their delay has prejudiced Noah and Sybil’s ability to defend the case because recollections and documents have been lost.

·         Unclean hands is a valid defense. In the supplemental declaration, the parties argue that:

o   David misappropriated the $225,000 without Sybil or Bernard’s permission because he needed that money to purchase a property he planned to “flip.” (Eisemann Supp. Decl. Ex. A [David Depo. 25:19-26:4, 30:15-19].)

o   Myra testified that she was unaware of David’s original $225,000 misappropriateion, claiming she learned about it only when she reconciled the bank account’s checkbook. (Eisemann Supp. Decl. Ex. B [Myra Depo. 293:8-10, 293:20-25, 311:23-312:10].) She testified she was unaware of the “first repayment” or the “second repayment (Id. [Myra Depo. 319:13-320:13].) However, the check register proves her awareness because most of the entries are in Myra’s handwriting before and after David recorded the balance for the repayment. (Eisemann Supp. Decl. Ex. D at MYRA000568.) David has testified that Myra routinely reconciled the bank account every three months. (Eisemann Supp. Decl. Ex. A. [David Depo. 24:21-24, 25:3-4, 25:13-18].) They argue that the relative amounts of handwriting show that Myra perjured herself.

§  The handwriting is not authenticated.

o   In addition, they argue that the claimed circumstances surrounding David’s repayment of the $225,000 are sufficiently absurd as to make it likely that David concocted the story about the second accidental repayment.

o   David said “could not recall” misappropriating funds from the Sinking Fund Trust that he maintained as trustee. [David Depo. 87:22-88:15, 90:2-10, 91:24-94:5; 104:15-105:5. 114:7-19.] They say this response “speaks volumes.”

In reply, filed on 1/13/23, Plaintiff argues that a continuance should not be granted. However, it was granted on 1/19/23.

ANALYSIS

1. Legal Standard for Motion for Summary Adjudication

“A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if that party contends that the cause of action has no merit or that there is no affirmative defense thereto, or that there is no merit to an affirmative defense as to any cause of action, or both, or that there is no merit to a claim for damages . . . or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.” (Code of Civ. Proc., §¿437c,¿subd. (f)(1).)¿ A¿motion for summary adjudication shall proceed in all procedural respects as a motion for summary judgment. (Code of Civ. Proc.,¿§¿437c,¿subd. (f)(2).)  

A plaintiff moving for summary judgment must show “that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action. Once the plaintiff or cross-complainant has met that burden, the burden shifts to the defendant or cross-defendant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto. The defendant or cross-defendant shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(2); see also, Code Civ. Proc., § 437c, subd. (o).) 

As noted in Aguilar, “the party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact.”  (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.)  Thus, courts usually follow a three-step analysis: “First, we identify the issues framed by the pleadings . . . . [¶] Secondly, we determine whether the moving party’s showing has established facts which negate the opponent’s claim and justify a judgment in movant’s favor. . . . [¶] When a . . . motion prima facie justifies a judgment, the third and final step is to determine whether the opposition demonstrates the existence of a triable, material factual issue.”  (Ojavan Investors, Inc. v. Cal. Coastal Comm. (1997) 54 Cal.App.4th 373, 385 [citation and footnote omitted].) 

Opposing parties must present substantial evidence in order to avoid summary judgment.  (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 163.)  “In some instances…, ‘evidence may be so lacking in probative value that it fails to raise any triable issue.’”  (Whitmire v. Ingersoll-Rand Co. (2010) 184 Cal.App.4th 1078, 1083-1084.)  “A complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial.”  (Hunter v. Pacific Mechanical Corp (1995) 37 Cal.App.4th 1282, 1286, disapproved on other grounds by Aguilar, supra, at 865; accord Saelzler v. Advanced Group 400 (2001) 25 Cal.4th 763, 780 [“‘If the plaintiff is unable to meet her burden of proof regarding an essential element of her case, all other facts are rendered immaterial.’”].) 

Courts “construe the moving party's affidavits strictly, construe the opponent's affidavits liberally, and resolve doubts about the¿propriety¿of granting the motion in favor of the party opposing it.’” (Unilab Corp.v. Angeles-IPA (2016) 244 Cal.App.4^th 622, 636; internal citation omitted.)  “The court focuses on issue finding; it does not resolve issues of fact. The court seeks to find contradictions in the evidence, or inferences reasonably deducible from the evidence, which raise a triable issue of material fact.”  (Johnson v. United Cerebral Palsy, etc. (2009) 173 Cal.App.4^th 740, 754; internal citation omitted.)    "[S]ummary judgment cannot be granted when the facts are susceptible [of] more than one reasonable inference...” (Rosas v. BASF Corp.¿(2015) 236 Cal.App.4^th 1378, 1392.)

B.      Evidentiary Objections

Plaintiff’s evidentiary objections to Noah Flom Declaration:

Overruled: 1, 2, 3, 4, 5 (first half), 6, 7.

Sustained: 5 (hearsay as to “He told me on a number of occasions that he wanted it to do that…”)

Plaintiff’s evidentiary objections to Sybil Flom Declaration:

Overruled: 2, 6, 7, 9, 10, 11, 12, 13, 14, 15, 16, 20, 27, 32, 33, 34, 35, 38, 40, 42, 43, 44.

Sustained: 1 (lack of foundation), 3, 4, 5, 8 (hearsay), 17 (lacks foundation), 18 (improper opinion), 19 (lacks foundation), 21, 22 (hearsay), 23, 24, 25, 26 (improper opinion), 28, 29, 30, 31 (lacks foundation), 36, 37, 39, 41, 45  (legal conclusion).

Plaintiff’s evidentiary objections to Alex Eisemann Declaration are all overruled.

C.      Affirmative Defenses to Partition Action

On December 7, 2021, the Court granted Myra and Bernard’s motion to bifurcate the Partition causes of action from all other causes of action in the FAC. Trial of the Partition causes of action is set for March 8, 2022.

On November 4, 2022, Myra filed a motion for summary adjudication as to the following Affirmative Defenses contained in the Answers filed by the Sybil Flom, Noah Flom, Maple & Vail LLC (“M&V”), and Apex Drum Company, Inc. (collectively, “Flom Defendants”): (1) Sixth Affirmative Defense (Estoppel); (2) Seventh Affirmative Defense (Waiver); (3) Eighth Affirmative Defense (Laches); and (4) Ninth Affirmative Defense (Unclean Hands).

Code Civil Procedure section 872.710(b) states that “Except as provided in Section 872.730, partition as to concurrent interests in the property shall be as of right unless barred by a valid waiver.” 

1.      Failure of Affirmative Defenses to State Facts Sufficient to Constitute a Defense

First, Plaintiff argues that Defendants’ boilerplate affirmative defenses are defective as a matter of law because they contain no facts, and, when given an opportunity to substantiate them with facts, Defendants have failed to do so.

A party can object to an answer that does not state facts sufficient to constitute a defense at any time. This objection is not waived by failure to demur. (Code Civ. Proc. § 430.80.) However, at the motion for summary judgment stage, the separate statement can be read to remedy some defects in the pleading of an ultimate fact. (FPI Develop Inc. v. Nakashima (1991) 231 Cal.App.3d 367, 381-382 [“We will treat the defendants' showing in the summary judgment proceeding as allegations of fact which amplify the conclusory allegations of affirmative defense in the answer where there is a plausible connection between them”].) It would be unfair for the court to ground a ruling on the inadequacy of the pleadings if the pleadings, read in the light of the facts adduced in the summary judgment proceeding, give notice to the plaintiffs of a potentially meritorious defense because the court could have given defendants leave to amend. (See id.)

Thus, the Court finds that the failure of Plaintiff to bring this objection until the summary judgment motion effectively waives this argument, especially considering the proximity to trial.

Plaintiffs put forward evidence that Defendants failed to substantiate their affirmative defenses with a statement of facts because, in response to Form Interrogatories, Defendants’ objected to discovery responses asking for “facts supporting your affirmative defenses.” (Owens Decl. ¶ 3, Ex. 2 [Form Interrogatorry 15.1.].) Plaintiff argues that she can rely on this factually devoid discovery response to meet plaintiff’s initial burden and to shift the burden. However, this objection-only response does not on its own show that Defendants lack evidence, as Plaintiff objected to the response. Where plaintiffs have had adequate opportunity for discovery, their factually-devoid responses to discovery requests may “show” that one or more elements of their claim “cannot be established.” (Union Bank v. Sup.Ct. (1995) 31 CA4th 573, 590.) This is not the case here, as this was not a “factually-devoid” response, but an objection only response.  

2.      Waiver

The absolute right to partition by a co-owner of real property may be waived by contract, either express or implied. (Code Civ. Proc. § 872.710(b); Orien v. Lutz (2017) 16 Cal.App.5th 957, 962.) Waiver is the intentional relinquishment of a known right after knowledge of the facts. (Roesch v. De Mota (1944) 24 Cal.2d 563, 572.) “The waiver may be either express, based on the words of the waiving party, or implied, based on conduct indicating an intent to relinquish the right. [Citation] [Citation]

‘“California courts will find waiver when a party intentionally relinquishes a right or when that party’s acts are so inconsistent with an intent to enforce the right as to induce a reasonable belief that such right has been relinquished.” (Wind Dancer Production Group v. Walt Disney Pictures (2017) 10 Cal.App.5th 56, 78.) “Waiver is ordinarily a question for the trier of fact; ‘[h]owever, where there are no disputed facts and only one reasonable inference may be drawn, the issue can be determined as a matter of law.’” (DuBeck v. California Physicians’ Service (2015) 234 Cal.App.4th 1254, 1265.)

In the motion, Plaintiff argues that there is no evidence of an express waiver agreeing to no partition. The evidence shows that Myra never expressly waived the ability to seek partition and that Sybil admitted that Myra never “expressed the view that none of the Maple and Vail properties could be sold if they were needed by Apex Drum.” (Myra Decl. ¶¶ 2-11; David Decl. ¶¶ 12-14; Owens Decl. ¶ 6, Ex. 5 [Sybil Depo. 23:5-23, 31:17-22, 59:12-22].) This evidence satisfies Plaintiff’s burden of proving there was no express waiver.

Myra also argues that there is no evidence to support an implied waiver of Myra’s right to partition. Courts have held that there may be an implied waiver of the right to partition based on an implied agreement to postpone partition when partition would defeat the purpose for which the parties acquired the property. (American Medical International v. Feller (1976) 59 Cal.App.3d 1008, 1013.) “Implied waiver of partition has been found where cotenants agreed to a plan designed to develop property over a period of time or invested in property which was subject to a long-term lease with a view toward obtaining a secure source of investment income.” (American Medical Int’l., supra, 59 Cal.App.3d at 1015 citing Thomas v. Witte (1963) 214 Cal.App.2d 322; Pine v. Tiedt (1965) 232 Cal.App.2d 733.)

Myra puts forth evidence that she never agreed that Apex Drum could operate indefinitely. (Myra Decl. ¶ 7, David Decl. ¶ 12.) Further, she puts forth evidence that the Lease with Apex Drum was not an agreement between the parties where they were to develop the property over a period of time. The evidence shows that there has been no official lease for Apex Drum on the Maple Vail Properties since the Lease signed in 1985. (Owens Decl. ¶ 7, Ex. 6 [Noah Depo. 251:24-25, 252:1-4, 258:14-17].) There was no lease with Apex Drum at the time of Abe Michlin’s death when Myra, Sybil, and Bernard acquired the property. (David Decl. ¶ 5.) Further, Myra argues that the 2020 Lease with Apex Drum is not an “implied waiver” because (1) Myra was not informed and did not approve of such a lease; and (2) Myra was not and has never been a member of Maple & Vail LLC (the “Lessor”) or an owner of Apex Drum (the “Tenant”). (Myra Decl. ¶¶ 8-9; David Decl. ¶¶ 12, 15, 16.) It is undisputed that Myra is not a member of Maple and Vail, LLC, nor do they own an interest in Apex Drum. (UMF No. 8-9.) Myra never signed a lease allowing Apex Drum to operate on Maple Vail Properties. (UMF No. 10.) Further, no long-term lease agreement was ever made between the cotenants and Apex Drum. (Myra Decl. ¶¶ 8, 9; David Decl. ¶¶ 12, 15, 16.)

This meets Plaintiff’s burden of showing that there is no implied waiver of Myra’s right to partition, as there was no plan to develop the property with a long-term lease that was subject to a long-term investment goal.

In opposition, Defendants argue that the land was purchased by Sybil and Myra’s parents specifically so that Apex Drum could run its business by storing its inventory there. (See e.g. Sybil Decl. ¶ 2.) However, disregarding the fact that this evidence mostly consists of inadmissible hearsay about what Abe allegedly told Sybil and Noah, this evidence still would not show that the parties acquired the property to use it to store the inventory for Apex Drum. The parties here acquired the property as tenants-in-common with equal 1/3 interests. There is no evidence that the parties were given the property specifically for the storage of Apex Drum, or that the long-term was a part of a long-term plan between the cotenants to develop the property. Further, it is undisputed that Sybil and Noah are the owners of Apex Drum, and Myra does not have an interest. Therefore, Myra would not benefit from the long-term lease in this instance.

Defendants also attempt to argue that Myra implicitly waived her right to partition by engaging in discussions where Sybil and Noah attempted to acquire her interest in the Maple and Vail Properties in 2018 and 2019. (Sybil Decl. ¶¶ 26, 28.) However, Defendants do not argue that Myra ultimately consented to these agreements, and it is undisputed that she did not sign these agreements. (UMF No. 24, 25.)

Defendants also attempt to argue that Myra implicitly agreed that Maple and Vail Properties would not be sold as long as Apex Drum continued to operate because she accepted benefits of Apex paying rent, which was distributed to her. (Sybil Decl. ¶¶ 26, 28.) However, as a cotenant, Myra had a right to take a part of the rent. Rent received from a third party for use of the property belongs to all the cotenants in common in accordance with their proportionate undivided interests. (Dabney-Johnston Oil Corp. v. Walden (1935) 4 Cal.2d 637, 655.) Thus, the fact that Myra accepted rent from Apex Drum, as is her right as a cotenant, cannot constitute a waiver.

The Court finds that Defendants have not met their burden of showing that a dispute of material fact exists as to the affirmative defense of waiver. Thus, summary adjudication is granted as to this affirmative defense.

3.      Estoppel

Although the Code of Civil Procedure provides that partition shall be as a matter of right unless barred by a valid waiver, it is unlikely that the Legislature intended to restrict the court’s powers of equity by barring the other affirmative defenses, especially when it did not expressly refer to such a limitation. (Miller & Starr 4 Cal. Real Est. § 11:20 (4th ed.).) Thus, the Court considers the other defenses.

In order to establish a defense of equitable estoppel the party must satisfy the following elements: 1) the party to be estopped must have been apprised of the facts; 2) the party to be estopped must have intended that his or her conduct be acted on, or must have acted so that the party asserting estoppel had a right to believe that it was so intended; 3) the party asserting the estoppel must have been ignorant of the true facts; and 4) the party asserting estoppel must have relied on the conduct to his or her injury. (City of Long Beach v. Mansell (1970) 3 Cal.3d 462; County of Sonoma v. Rex (1991) 231 Cal.App.3d 1289).

Myra argues that there was no estoppel. It appears that the defense of estoppel is that Noah and Sybil’s interest in Apex Drum will be affected because they have relied upon the ability to lease the property to Apex Drum, and Apex Drum will go out of business if it is not able to Lease the property. However, the Joint Statement regarding the Partition trial submitted on April 23, 2022, concedes that “Defendants Noah and Maple and Vail, LLC are not involved in the partition action, as neither of them own any interest in the properties. Further, Sybil cannot raise the defense that she is losing income from the operations of Apex Drum. (Owens Decl. ¶ 9, Ex. 8.)

Myra also argues that Sybil has testified that historically the home of Apex Drum has always been located at 6170-6176-6202-6226 Ferguson Drive in the City of Commerce, California, not on these two lots in Montebello, and the cutting, grinding, cleaning, painting of the plastic drums takes place at Ferguson, not Montabello. (Owens Decl. ¶ 6, Ex. 5. [Sybil Decl. 122:14-22, 56:12-57:1-4, 58:22-24, 59:4-6].) Thus, Myra argues that there is no evidence that Apex Drum will go out of business if the Maple Vail Properties are partitioned because they have other space.

Further, the evidence above shows that Myra was not a signatory of any Lease with Apex Drum. Thus, as argued above, she has not consented to the Lease and could not then have induced Noah, Sybil, and Apex to believe it could remain. Further, Sybil herself stated that Myra has not expressed that the Property could not be sold if Apex remained as a lessee.  Owens Decl. ¶ 6, Ex. 5 [Sybil Depo. 23:5-23, 31:17-22, 59:12-22].)

This evidence meets Myra’s burden of proving that there was no estoppel.

In opposition, Defendants’ evidence primarily puts forward facts showing that Noah invested millions of dollars in Apex Drum because of his expectation that plaintiff would continue the decades-long practice of allowing the family business to continue operating on the Maple and Vail Properties. (Noah Decl. ¶¶ 6-7.) Noah changed his life plans to return to carry on the family business, which he did for twenty years, generating income by paying rent which has been distributed to Myra, Bernard, and Sybil. (Noah Decl. ¶ 4, Sybil Decl. ¶ 5, 24-25.) They also argue that Sybil’s 20% interest in Apex Drum will be significantly impacted on destroying the business that she spent years of her life managing.

However, these arguments are unavailing because the Stipulation specifically states that Noah is not involved in the partition action, as he does not own an interest in the property. Thus, Noah’s reliance on the ongoing lease of the property is not relevant, as he is not a party to the partition action. Further, “[t]he fact that lands are leased does not prevent partition of the property that is subject to the possession of the lessee until termination of the lease notwithstanding that the lease may also be a cotenant owning a share of the property.” (Buhrmeister v. Buhrmeister (1909) 10 Cal.App. 392.)

Even if Noah’s interest was relevant, the evidence put forth in Noah’s declaration is conclusory and not based on any extrinsic evidence that would tend to prove that Apex Drum would go out of business without the ability to use the Maple and Vail Properties as storage. (See Noah Decl. ¶¶ 4-5.)

Further, this evidence put forth by Myra does not show that Myra’s actions induced Defendants to rely on the fact that they would be able to continually lease the Property. As mentioned above, Myra was not a signatory to any lease with Apex.

Defendants also argue that Sybil’s 20% interest in Apex Drum will be significantly impacted on destroying the business that she spent years of her life managing. However, this argument was also waived in the Stipulation. (See Owens Decl. ¶ 9, Ex. 8.)

Thus, Defendants have not met their burden here of showing a dispute of material fact. Thus, summary adjudication is granted as to this affirmative defense.

4.      Laches 

In order to establish laches, the party must show: 1) an omission to assert a right; 2) a delay in the assertion of the right for some appreciable period; and 3) circumstances which would cause prejudice to an adverse party if assertion of the right is permitted. (Stafford v. California Canning Peach Growers (1938) 11 Cal.2d 212.)

Myra argues there are no facts showing that Myra delayed in asserting the right to partition for an appreciable period, and circumstances would cause prejudice to Sybil if the partition is permitted.

Myra argues that there was no delay in asserting Myra’s right to partition because there were ongoing discussions and Myra did not know that the right needed to be invoked until mid-2020. It is undisputed that in late 2018, Noah began to try to acquire Myra and Bernard’s title to the Maple Vail Properties, and started to form M&V. (Owens Decl. ¶ 17, Ex. 16.) This continued in 2019, where Bernard was urging Myra to sign a grant deed transferring her interest. (Myra Decl. ¶¶ 13-15.)  It was not until a June 23, 2020 family meeting that Myra became convinced that it would not be possible to come to a mutually satisfactory resolution of the issues involving Maple Vail Properties. (Myra Decl. ¶ 14, 18.) The lawsuit was filed two months after. (Myra Decl. ¶ 15.)

Myra additionally argues that Sybil is not prejudiced because the real estate value has increased. (Weiss Decl. ¶¶ 7-9, Exs. B-D.) This evidence meets Plaintiff’s burden.

In response, Defendants offer similar evidence to the argument above for estoppel, arguing that Noah took steps in reliance on the implied agreement that Apex Drum would be allowed to continue operating on the property. Had Plaintiff initiated this partition action earlier, Noah would not have had such detrimental reliance. However, as mentioned above, Noah is not involved in the partition action, and Noah’s declaration submitted as evidence is conclusory and without additional supporting evidence.

They also argue that the delay has prejudiced Noah and Sybil’s ability to defend the case because recollections and documents have been lost. However, they produce no evidence to support this statement.

Thus, the court finds that Defendants have not put forward evidence to create a triable dispute of material fact.

Thus, summary adjudication is granted as to this affirmative defense.

5.      Unclean Hands

The doctrine of unclean hands “demands that a plaintiff act fairly in the matter for which he seeks a remedy.” (Kendall-Jackson Winery Ltd. v. Superior Court (1999) 76 Cal.App.4th 970, 978.) Not every wrongful act constitutes unclean hands. But, the misconduct need not be a crime or an actionable tort. Any conduct that violates conscience, or good faith, or other equitable standards of conduct is sufficient cause to invoke the doctrine. (DeRosa v. Transamerica Title Ins. Co. (1989) 213 Cal.App.3d 1390, 1395–1396.) “The misconduct that brings the clean hands doctrine into play must relate directly to the cause at issue. Past improper conduct or prior misconduct that only indirectly affects the problem before the court does not suffice. The determination of the unclean hands defense cannot be distorted into a proceeding to try the general morals of the parties.” (Kendall-Jackson Winery, supra, 76 Cal.App. at 978.) Unclean hands can be asserted when “the manner of dirtying renders inequitable the assertion of such rights against the defendant. [Citation] The misconduct must prejudicially affect the rights of the person against whom the relief is sought so that it would be inequitable to grant such relief.” (Id.)

Plaintiff argues that Defendants have been unable to produce any evidence of “unclean hands.” The unclean hands argument surrounds Myra’s husband, David, allegedly misappropriating $225,000 from the proceeds of the property. Plaintiff argues that this unclean hands argument can be determined as a matter of law because the incident is not “directly related” to the partition cause of action.

Defendants argue that David misappropriated $225,000 of the Maple and Vail Property funds from the Morning Star Trust without Sybil or Bernard’s permission. (Eisemann Supp. Decl. Ex. A [David Depo. 25:19-26:4, 30:15-19].) Plaintiffs argue that the $225,000 loan was repaid almost one year after the loan had been repaid in full, and then accidentally repaid again. (UMF No. 33, 34; David Decl. ¶ 19.) Defendants do not directly dispute the $225,000 was repaid. (UMF No. 33.) However, they dispute that the money was repaid a second time. (UMF No. 34.)

Defendants argue that Myra testified that she was unaware of David’s original $225,000 misappropriation, claiming she learned about it only when she reconciled the bank account’s checkbook. (Eisemann Supp. Decl. Ex. B [Myra Depo. 293:8-10, 293:20-25, 311:23-312:10].) She testified she was unaware of the “first repayment” or the “second repayment (Id. [Myra Depo. 319:13-320:13].) However, Defendants argue that the check register proves her awareness because most of the entries are in Myra’s handwriting before and after David recorded the balance for the repayment. (Eisemann Supp. Decl. Ex. D at MYRA000568.) David has testified that Myra routinely reconciled the bank account every three months. (Eisemann Supp. Decl. Ex. A. [David Depo. 24:21-24, 25:3-4, 25:13-18].) Regardless, they argue that Myra benefitted from the $225,000. They argue that Myra perjured herself because the evidence shows she should have been aware.

In addition, Defendants argue that David said he “could not recall” misappropriating funds from the Sinking Fund Trust that he maintained as trustee for the Maple and Vail Properties, when asked in a deposition. [David Depo. 87:22-88:15, 90:2-10, 91:24-94:5; 104:15-105:5. 114:7-19.] They say this response “speaks volumes” about David’s history of “misappropriating funds and makes it likely that he did so on other occasions, quite probably involving the Maple and Vail Property funds.” This evidence is not satisfactory to show that David misappropriated funds from the Sinking Funds Trust.

Although there appears to be a dispute as to whether David misappropriated funds from the Trust managing the Maple and Vail Properties, as Plaintiff has pointed out, Defendants cannot show that this incident is directly related to the partition action. Defendants make no argument showing how this incident is directly related to the partition action or how this alleged misappropriation incident prejudiced Defendants’ rights in the partition action.  

Further, from Defendants evidence, it appears that the $225,000 was repaid twice over. The first repayment occurred shortly after the funds were withdrawn, in December 2017, and the second repayment occurred in November 2018. (Eisemann Supp. Decl. Ex. C.) This double repayment does not tend to help Defendants’ argument, as it seems clear that the allegedly misappropriated funds were repaid back twice over.

Thus, summary adjudication is granted as to this affirmative defense.