18-CIV-06194 AMERICAN ASIAN UNITED BUSINESS ASSOCIATION, INC. VS. JOHN C. AKKAYA, ET AL.

AMERICAN ASIAN UNITED BUSINESS ASSOCIATION, INC. JOHN C. AKKAYA
ANDREW G. WATTERS MARC G. HYNES

PLAINTIFF’S MOTION FOR LEAVE TO AMEND TENTATIVE RULING:

Plaintiff/Cross-Defendant American Asian United Business Association’s motion for leave to amend its complaint is DENIED.

Plaintiff seeks to amend the complaint to substitute “American And Asian Unite Association Corp.” as Plaintiff and to add a cause of action for declaratory relief “concerning the real party in interest on the lease.” Separate Stmt. of Amendments. Plaintiff claims it “mistakenly used the wrong legal name for the corporation in the complaint,…” Notice of Motion filed December 23, 2019 at 1:10-12. Trial was originally set for December 2, 2019, assigned a trial judge, and trial was continued so that the Law and Motion department could decide this matter. Trial is now scheduled for March 23, 2020.

The Court is well aware of the policy favoring amendment and that the court’s discretion is to be exercised liberally to permit amendments of pleadings. Weil & Brown, California Practice Guide: Civil Procedure Before Trial § 6:638 (TRG 2019). If plaintiff can show that the motion is timely and that there is no prejudice to the opposing party, the motion should be granted. Id. at 6:639. This case, however, is one of those rare cases where, based upon a review of the facts, the Court using its discretion DENIES the motion to amend because Plaintiff should have discovered earlier the “mistake” that its own name was incorrect and the prejudice to Defendants, as a result of the “mistake” is substantial.

Plaintiff claims that it only discovered in November 22, 2019 that it had named the wrong plaintiff and no one had picked it up earlier. Declaration of Andrew Watters, parag. 7, 8. The attorney declaration in support of the motion states that when he took on the case in 2018, he relied upon his clients for the correct name of the Plaintiff. Id. parag. 2. The failure to discover for over one year that the correct plaintiff has been named shows a lack of diligence by the Plaintiff. The correct name is a fundamental element of the right to recover. From the outset of the litigation and in discovery responses, Plaintiff had opportunities and failed to discover this error. David Chan (“Chan”), in a declaration signed November 15, 2018 in support of a temporary restraining order, declared under penalty of perjury that he was one of Plaintiff’s corporate officers and stated that Plaintiff signed a lease. Declaration of Marc G. Hynes in opposition to Plaintiff’s motion to amend, ex. A at 3:18-22; see also id., ex. B at .3:11-15 (declaration signed by Chan under penalty of perjury on November 19, 2018 attesting to the same information). In responses to Requests for Admissions, Plaintiff admitted that Chan was a corporate officer and agent of Plaintiff. Id., exs. C and D, Response to Request for Admissions 3 and 4 signed November 7, 2019. At a PMK deposition, Chan testified that he was the vice president and a member of the board of directors of the corporation (referring to Plaintiff). Id., ex. E at 13:1-12. Then, in answers to form interrogatories, Plaintiff stated that it was a corporation and that the name in current articles of incorporation was American and Asian Unite Association Corp. and, from 2018 to the present, it has used the name of American Asian United Business Association, Inc. Id., exs. G and H, response to No. 3.1. Plaintiff’s motion is devoid of any facts explaining the relationship, if any, between the named Plaintiff American Asian United Business Association and American And Asian Unite Association Corp. The interrogatory answer suggests that there was a change in corporate name, but Plaintiff’s motion is based upon “a mistake” as to the legal name. Plaintiff’s Motion at 2:2-3: “The parties jointly made a mistake as to the legal name of the Plaintiff.” The Court notes that Defendants correctly points out that the mistake was Plaintiff’s mistake alone. Accordingly, if leave to amend was granted the case would have to basically start anew.

At this point in the proceedings, allowing the complaint to be amended would be prejudicial to Defendant. Based on the current trial date of March 23, Defendant does not have a meaningful opportunity to conduct additional discovery relating to the new plaintiff, the new plaintiff’s proposed cause of action or to potential claims for fraud or corporate piercing. The discovery done to date needs to be redone, including the deposition of the PMK. The trial date would have to be continued. “There is a platoon of authority to the effect that a long unexcused delay is sufficient to uphold a trial judge’s decision to deny the opportunity to amend pleadings, particularly where the new amendment would interject a new issue which requires further discovery.” Green v. Rancho Santa Margarita Mortgage Co. (1994) 28 Cal.App.4th 686, 692. Consistent with this authority, the court denies Plaintiff’s motion.

The parties’ requests for judicial notice are GRANTED. Evid. Code § 452(c), (d). Judicial notice is taken of the documents’ filing/recording, contents, and legal effect, but not the truth of allegations therein.

Defendants’ objection to the Declaration of Andrew Watters at 2:19-21 on the basis of hearsay is OVERRULED for non-hearsay purposes, e.g. the effect on the listener, but SUSTAINED on hearsay grounds for the truth of the matter.

If the tentative ruling is uncontested, it shall become the order of the Court. Thereafter, counsel for Plaintiff shall prepare a written order consistent with the Court’s ruling for the Court’s signature, pursuant to California Rules of Court, Rule 3.1312, and provide written notice of the ruling to all parties who have appeared in the action, as required by law and the California Rules of Court.