Case Number: BC510184    Hearing Date: July 30, 2014    Dept: 32

CASE NAME: JTNA Enterprises, LLC v. Yang Liu, et al.
CASE NO.: BC510184
HEARING DATE: 07/30/14
DEPARTMENT: 32
CALENDAR NO.: 2
SUBJECT: Motion for Leave to File Cross-Complaint
MOVING PARTY: Defendants Yang Liu, Nick Tsuei, and Mao Yang Trading, Inc.
RESP. PARTY: None

COURT’S TENTATIVE RULING

Motion for Leave to File Cross-Complaint GRANTED. Cross-Complaint to be filed within 5-days.

ANALYSIS

The Code of Civil Procedure (CCP) allows the fling of cross complaints so that all disputes between parties to a case can be resolved in a single proceeding if appropriate. To that end, “[a] party against whom a cause of action has been asserted in a complaint or cross-complaint may file a cross-complaint setting forth … (b) Any cause of action he has against a person alleged to be liable thereon, whether or not such person is already a party to the action, if the cause of action asserted in his cross-complaint (1) arises out of the same transaction, occurrence, or series of transactions or occurrences as the cause brought against him.” (CCP § 428.10(b).)

CCP § 428.50 states the following regarding the circumstances under which leave to amend is required to file a cross-complaint:

(a) A party shall file a cross-complaint against any of the parties who filed the complaint or cross-complaint against him or her before or at the same time as the answer to the complaint or cross-complaint.
(b) Any other cross-complaint may be filed at any time before the court has set a date for trial.
(c) A party shall obtain leave of court to file any cross-complaint except one filed within the time specified in subdivision (a) or (b). Leave may be granted in the interest of justice at any time during the course of the action.

“[D]iscretion should be exercised liberally in favor of amendments, for judicial policy favors resolution of all disputed matters in the same lawsuit.” (Kittredge Sports Co. v. Sup. Ct. (1989) 213 Cal.App.3d 1045, 1047.) It is generally abuse of discretion to deny leave to amend if the opposing party does not show prejudice. (Ibid.)

In the motion, Defendants seek leave to file a cross-complaint against Emi Liang for equitable indemnity, contribution, and declaratory relief. Defendants contend that Otto Liang and Emi Liang were dismissed from the action after Otto Liang filed for bankruptcy. However, Emi Liang has not filed for bankruptcy, and Plaintiffs contend that they have a claim for indemnity against her since she was the assignee of the lease. Defendants’ counsel declares that he did not discover that only Otto Liang had filed for bankruptcy, and not Emi Liang, until February 2014. (Gross Decl. ¶¶ 4-9.) Based on the foregoing, Defendants have shown good cause for the cross-complaint and have adequately explained the delay. Trial is set for September 2, 2014, and it appears there is sufficient time before trial so that no party would be prejudiced. The above ruling is without prejudice to an application by Emi Liang for any appropriate relief, such as a trial continuance or a severance of the cross complaint.

The motion is GRANTED. Cross-Complaint to be filed within 5-days.