Tentative Ruling

Judge Donna Geck
Department 4 SB-Anacapa
1100 Anacapa Street P.O. Box 21107 Santa Barbara, CA 93121-1107

CIVIL LAW & MOTION
Matthew P Quirk et al vs Berl Golomb et al
Case No: 17CV00966
Hearing Date: Fri Dec 13, 2019 9:30

Nature of Proceedings: Motion: Leave to File First Amended Cross-Complaint

TENTATIVE RULING: The motion is granted. The Towbes defendants are directed to separately file their First Amended Cross-Complaint forthwith.

Background: This action arose as a result of personal injuries sustained by Trader Joe’s customer Matthew P. Quirk when an elderly driver, defendant Berl Golomb, drove his vehicle through the entrance of the store and struck plaintiff. His complaint, filed March 6, 2017, asserted claims against Golomb, Trader Joe’s Company, Earl M. Hill Family Limited Partnership, and The Towbes Group. Defendant Golomb settled out of the action in late 2017, and the court granted a good faith determination with respect to the settlement.

The remaining parties unsuccessfully attempted to mediate the action in early 2018. A conflict arose after the mediation between the remaining defendants, which caused new attorneys to substitute in for Trader Joe’s, and for the Limited Partnership and Towbes Group (Towbes defendants), who had previously been represented jointly by the same attorneys. Trader Joes filed a motion for leave to file a cross-complaint against the Towbes defendants in June, 2018, based upon its contention that its lease with the Towbes entities entitled it to certain defense and immunity rights. The unopposed motion was granted in July 2018.

Further mediations were conducted in December 2018, January 2019, and June 2019. The mediations were unsuccessful in resolving the claims among the defendants, but the plaintiffs’ claims were resolved at the January 2019 mediation.

The Towbes defendants sought leave to file a cross-complaint for equitable indemnity, implied indemnity, contribution, and declaratory relief against defendant and cross-complainant Trader Joe’s Company, in August 2019. The motion was granted over Trader Joe’s opposition, although only as to the cross-complaint which had been the subject of the moving papers, and not the cross-complaint (which added a cause of action for breach of contract) which was submitted to the Court for the first time attached to a sur-reply which was filed two days prior to the hearing, without providing any justification for or explanation of the eleventh hour switch. The Court advised the Towbes defendants that if they truly believed the late-presented cross-complaint was critical to their litigation, the court would consider allowing leave to file it in a separately-filed motion which met the requirements for doing so in the moving papers.

The Towbes defendants filed the current motion for leave to file the cross-complaint containing the breach of contract cause of action, on November 5, 2019. Based on the policy of resolving disputes on their merits, and to allow amendment at any time to ensure resolution of all disputes at time of trial, the Towbes defendants assert that leave to amend their cross-complaint should be granted. They assert that the FACC is compulsory, because their claims arise from the same occurrence (the accident) and transaction (the lease agreement) as the allegations in the Trader Joe’s cross-complaint against them. The only matter being added to the existing cross-complaint is the cause of action for breach of contract. Trader Joe’s will not be prejudiced by addition of the claim, as it is well aware of Towbes’ position and competing claims, which have been discussed throughout the case and the multiple mediations. After the prior motion had been filed, but before the hearing, Towbes’ counsel was contacted by an attorney retained by Towbes’ insurance carrier to consult on the litigation, and that attorney suggested adding the breach of contract cause of action, as another theory for recovery on the same facts alleged. Litigation counsel agreed with his analysis, and attempted to add it through the filing of the sur-reply.

Trader Joe’s once again opposes the motion, asserting that the cross-complaint is permissive and not compulsory, since it had not accrued when the Towbes defendants answered plaintiffs’ complaint. Even if compulsory, Trader Joe’s asserts that the Towbes defendants’ delay was unjustified and prejudicial. They failed to allege the claim at the time they answered Trader Joe’s cross-complaint, failed to allege the claim when they first moved for leave to file a cross-complaint, and failed to diligently file the current motion after the court’s 8/9/19 order. Trader Joe’s asserts that the Towbes defendants at all times had possession of the lease agreement that underlies the new cause of action. Finally, Trader Joe’s asserts that the filing of the FACC will prejudice it, contending that it will have to adopt a new trial strategy shortly before the 3/20/20 trial date, and will also be prejudiced because it has filed a motion for summary adjudication.

In reply, the Towbes’ defendants dispute Trader Joe’s contention that the cross-complaint is not compulsory. Further, Trader Joe’s has already agreed that it is to its benefit to have the competing contractual claims resolved in this litigation. Further, the motion is not untimely, given that it was filed 5 months before the current trial date, and Trader Joe’s has long known of the Towbes’ defendants’ intent to assert the arguments. Trader Joe’s arguments about prejudice are unpersuasive, given that it has already advised the court that it would be beneficial to resolve all contract claims in this litigation. Given liberality allowed in amending pleadings, the Towbes’ defendants assert that the motion should be granted.

ANALYSIS: The motion is granted. The Towbes defendants are directed to separately file their FACC forthwith.

Whether or not the cross-complaint is compulsory, it makes sense to have it heard with the rest of the disputes among these parties. But for the fact that the pleading that is now the FACC was submitted in August only 2 days prior to the hearing on the motion for leave, and the sur-reply to which it attached provided no explanation as to why it was being presented at that time, or why leave should be granted to file it, the Court would likely have continued the hearing on the original motion to allow Trader Joe’s an opportunity to address the second cross-complaint, and resolved the entire issue at one time. Because no explanation or justification was provided, it appeared to the Court to be a “bait-and-switch” tactic, and the Court could not simply allow its filing without such information. It now has that information, and has determined that the interests of justice and judicial efficiency support the resolution of the breach of contract cause of action in the current litigation.

Trader Joe’s claims of prejudice involve its contention that it will incur substantial fees and costs, but other than a vague claim that it will need to alter its trial strategy, does not articulate any discovery or other specific actions which will be require with the amended cross-complaint, that would not already have been required with the original cross-complaint. While it further objects that it will be prejudiced because it has “already” filed a motion for summary adjudication, the Court notes that the motion for summary adjudication was filed more than three weeks after the motion for leave to file a FACC was filed. The Court does not find the claimed prejudice sufficient to outweigh the liberal policy of amendment of pleadings, or the need to resolve all of the disputes between these parties in this litigation.

If the parties honestly believe that they need additional time to prepare for trial, such that the current March 20, 2020 trial date is unworkable, the Court would be amenable to a brief continuance of that date.