30-2015-00826121 Laguna Sound Studio, LLC. vs. Yrizarry

The motion by defendant Huang Enterprises, LP (“Huang”) for summary judgment or in the alternative, for summary adjudication is denied in its entirety.

This case involves a dispute between a father (defendant Nicholas Yrizarry) and his adult son (plaintiff Dustin Yrizarry), and a lessor of commercial space (Huang). Plaintiff Dustin and his company, Laguna sound Studio, LLC (“LSS”), initiated this lawsuit against Huang, Nicholas and Nicholas Yrizarry Wealth management Group (“Nicholas’ Firm”) for (1) conversion, (2) violation of Penal Code section 496, (3) wrongful eviction (against Huang only), and (4) breach of contract (against Nicholas’ Firm only). As to Huang, plaintiff alleges he was wrongfully evicted from the premises he and his father jointly lease from Huang, and that Huang, and that Huang assisted Nicholas in depriving Dustin and LSS of their equipment and personal property located in the leased premises.

Huang moves for summary judgment on plaintiffs’ entire complaint or, in the alternative, for summary adjudication of the first, second and third causes of action against Huang, and on plaintiffs’ prayer for punitive damages.

In support of its motion, Huang submitted evidence showing the tenants defaulted under the lease by failing to make the November 2015, monthly payment. Huang then served a three-day notice to pay or quit on November 12, 2015, by substituted serve on an employee at Nicholas’ Firm, and also mailed copies to the tenants at the premises. The lessees did not cure the default. Instead, Nicholas sent a letter to Huang on November 23, 2015, indicating he did not intend to pay the November past-due rent on behalf of Laguna Sound Studio, LLC, and that he would “have [his] set of keys for the space for you to pick up.” Nicholas did not copy Dustin on the letter, or provide an address for Dustin. Nicholas then turned over possession of the premises to Huang. Then, on November 30, 2015, Huang prepared a Notice of Right to Reclaim Abandoned Property addressed only to Nicholas, and served copies by mail to all three tenants at the address of Nicholas’ Firm. Nicholas claimed the equipment, and Huang turned it over to him. Nicholas then entered into a new lease with Huang for the premises with Nicholas listed as the only tenant.

Relevant to all three causes of action against Huang, Huang failed to meet its initial burden of showing it properly served the three-day notice and terminated the lease. Huang also failed to meet its burden of showing proper service on all tenants of the Notice of Right to Reclaim Abandoned Property.

The operative commercial lease is attached to plaintiffs’ complaint. The provision governing notices appears on page 10 at Section 23.1, and provides as follows:

“23.1 Notice Requirements. All notices required or permitted by this Lease or applicable law shall be in writing and may be delivered in person (by hand or by courier) or may be sent by regular, certified or registered mail or U.S. Postal Service Express Mail, with postage prepaid, or by facsimile transmission, and shall be deemed sufficiently given if served in a manner specified in this Paragraph 23. The addresses noted adjacent to a Party’s signature on this Lease shall be that Party’s address for delivery or mailing of notices. Either Party may by written notice to the other specify a different address for notice, except that upon Lessee’s taking possession of the Premises, the Premises shall constitute Lessee’s address for notice. . . .”

LSS, Nicholas and Dustin are all named as co-tenants under the lease, and Huang acknowledges its understanding in the motion that Dustin, Nicholas and LSS were all tenants under the lease.

When the tenants defaulted by not paying November 2015 rent, Huang opted to serve a three-day notice, but does not show it was property served. Huang attempted to effectuate service solely by mailing the three-day notice to the tenants at the address of the leased premises. The notice was not also posted at the premises or hand delivered to the tenants. (See, Code Civ. Proc. § 1162(b).) Only Nicholas acknowledged receipt of service and agreed to terminate the lease. Therefore, Huang has not met its burden on the third cause of action for wrongful eviction.

Huang also failed to meet its burden of showing proper service on all tenants of the Notice of Right to Reclaim Abandoned Property. Huang was required under Civil Code section 1993.03 to serve written notice to the “tenant.” Huang only admittedly directed the notice to one tenant only (Nicholas), and failed to show that service of that notice at Nicholas’ Firm on all three tenants constituted proper notice. Huang, therefore, has not established it has immunity under Civil Code section 1993.08.

Having failed to meet its burden on the motion as to the first three causes of action, the burden never shifted to plaintiffs on the motion.

The motion for summary adjudication of the prayer for punitive damages also is denied. Punitive damages are recoverable conversion and wrongful eviction. Here, at least an inference arguably can be made that Huang colluded with Nicolas Yrizarry, one tenant, to deprive Dustin Yrizarry, the other tenant, of notice of the lease termination and disposition of the personal property.

Defendant Huang to give notice.