Judge: William A. Crowfoot, Case: 20GDCV00924, Date: 2023-03-21 Tentative Ruling

Case Number: 20GDCV00924    Hearing Date: March 21, 2023    Dept: 3

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES - NORTHEAST DISTRICT

I.       INTRODUCTION

           This is an action to recover money for pharmaceutical services provided by plaintiff Corona Medical, Inc. (“Plaintiff”) to Med Star Hospice Care, Inc. (“Med Star”).  The action was originally filed on October 29, 2020 and named Med Star and Maria Cecilia Tran (“Tran”) as defendants.  Moving parties Anil Donald Mall (“Mall”) and Silverlake Management LLC (“Silvelakes”) were named as Doe 1 and Doe 2 in Plaintiff’s Complaint on June 4, 2021.  A First Amended Complaint (“FAC”) was filed on August 9, 2021.  On March 9, 2022, Tran was dismissed from the FAC. 

          On September 14, 2022, Plaintiff filed the operative Second Amended Complaint (“SAC”) with leave of court. 

On September 26, 2022, Mall and Silverlakes filed a cross-complaint against Med Star and Tran for indemnity and declaratory relief, which was amended on October 12, 2022. 

On December 12, 2022, Tran filed a cross-complaint (“Cross-Complaint”) against Med Star, Mall, and Silverlakes for declaratory relief, breach of oral contract, indemnity, and contribution.  Tran alleges that Mall is the true and beneficial owner of Med Mal and that any shares that were acquired on July 1, 2019 were acquired on Mall’s behalf.  (Cross-Compl., ¶ 7-8.)  Tran also alleges that she executed a management agreement with Silverlakes and that Silverlakes is owned or controlled by Mall.  (Id., ¶ 9.)  As a result, Tran held the shares for Med Star for the benefit of Mall while Mall controlled Med Star through Silverlakes.  (Id., ¶ 10.)  She disclaims any right to profit from or control of the operations of Med Star and Silverlakes and claims that Mall selected and contracted with Plaintiff as a vendor in 2019.  (Id., ¶ 17-18.) 

On January 13, 2023, Mall and Silverlakes filed the instant demurrer to Tran’s Cross-Complaint.  Mall and Silverlakes argue that Tran’s causes of action for breach of oral contract, indemnity, and contribution fail to state sufficient facts. 

II.      LEGAL STANDARDS

A demurrer tests the legal sufficiency of the pleadings and will be sustained only where the pleading is defective on its face. (City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1998) 68 Cal.App.4th 445, 459.)  “We treat the demurrer as admitting all material facts properly pleaded but not contentions, deductions or conclusions of fact or law.  We accept the factual allegations of the complaint as true and also consider matters which may be judicially noticed.  [Citation.]”  (Mitchell v. California Department of Public Health (2016) 1 Cal.App.5th 1000, 1007; Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604 [“the facts alleged in the pleading are deemed to be true, however improbable they may be”].)  Allegations are to be liberally construed.  (Code Civ. Proc., § 452.)  A demurrer may be brought if insufficient facts are stated to support the cause of action asserted.  (Code Civ. Proc., § 430.10, subd. (e).) 

Leave to amend must be allowed where there is a reasonable possibility of successful amendment.  (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.)  The burden is on the complainant to show the Court that a pleading can be amended successfully.  (Ibid.)

III.     DISCUSSION

          Breach of Oral Contract

          Tran’s second cause of action for breach of oral contract alleges that on July 1, 2019, she entered into an agreement with Mall and Med Star to receive employment compensation for serving as the administrator (and later, as CEO) of Med Star and for holding the shares of Med Star on Mall’s behalf.  (Cross-Comp., ¶ 29.)  She alleges that on or about the end of April 2020, Mall and Med Star breached the agreement by stopping all communications with her regarding her duties and refusing to compensate her for her services. 

          Mall and Silverlakes argue that Tran’s contract claim is barred by the statute of limitations and the statute of frauds.  They are correct.  A breach of an oral contract has a two-year statute of limitations.  (CCP § 339.)  Tran alleges that the breach occurred on or around April 2020 and filed this cross-complaint on December 12, 2022, which is more than 2 years after the alleged breach.  As for the statute of frauds, it applies to an agreement that cannot be completed within one year of its formation.  (See Blaustein v. Burton (1970) 9 Cal.App.3d 161, 185.) 

          Accordingly, the demurrer to Tran’s second cause of action is SUSTAINED.

          Indemnity and Contribution

          Mall and Silverlakes argue that Tran’s claims for indemnity and contribution fail because Tran fails to identify any agreement to indemnify her. 

In general, indemnity refers to “the obligation resting on one party to make good a loss or damage another party has incurred.”  (Rossmoor Sanitation, Inc. v. Pylon, Inc. (1975) 13 Cal.3d 622, 628.)  There are two basic types of indemnity: express indemnity, which relies on an express contract term providing for indemnification, and equitable indemnity.  (Prince v. Pacific Gas & Electric Co. (2009) 45 Cal.4th 1151, 1157.) 

Here, Tran is not being sued by Plaintiff and Plaintiff is not seeking damages from her; on the contrary, Tran has been dismissed from the action.  Therefore, there is nothing to indemnify her against. 

          Similarly, Similarly, Tran’s cause of action for contribution fails because a contribution claim relies on the existence of a judgment rendered against joint tortfeasors.  (CCP § 875.)  Again, Tran is not being sued by Plaintiff and Plaintiff does not seek any damages.  Instead, Tran is being sued by Mall and Silverlakes.  Therefore, her request for contribution is an incorrect assertion of a denial or affirmative defense.   

          Accordingly, the demurrer to the third and fourth causes of action is also SUSTAINED. 

IV.     CONCLUSION

Mall and Silverlakes’ demurrer is SUSTAINED in its entirety.  As Tran did not oppose this demurrer, no leave to amend is granted. 

Moving party to give notice.

Parties who intend to submit on this tentative must send an email to the Court at ALHDEPT27@lacourt.org indicating intention to submit on the tentative as directed by the instructions provided on the court website at www.lacourt.org.  Please be advised that if you submit on the tentative and elect not to appear at the hearing, the opposing party may nevertheless appear at the hearing and argue the matter.  Unless you receive a submission from all other parties in the matter, you should assume that others might appear at the hearing to argue.  If the Court does not receive emails from the parties indicating submission on this tentative ruling and there are no appearances at the hearing, the Court may, at its discretion, adopt the tentative as the final order or place the motion off calendar.

Dated this 21st day of March 2023