Case Name: Mario Hidalgo, et al. v. Pacific Gas and Electric Co., et al.
Case No.: 2016-CV-297926

Motion for Summary Judgment to the Complaint by Defendants Florence Sordello, individually, and in her capacity as trustee of the Sordello Family Trust

Factual and Procedural Background

This case arises from a Pacific Gas and Electric Company (“PG&E”) gas meter explosion and three-alarm fire that occurred on August 26, 2015 at the Poinciana Plaza strip mall (“Plaza”) in Santa Clara County. (Complaint at ¶ 1.) Immediately to the north of the subject gas meter was a parking lot for an adjacent 7-Eleven, Inc. (“7-Eleven”) convenience store. (Id. at ¶ 23.) Between the gas meter and the boundary of the parking lot there were only 10 feet or so of empty space. (Ibid.) The 7-Eleven parking lot itself had only a small parking curb and no other structure or enclosure existed along its southern boundary so as to stop or slow a vehicle from entering the Plaza property. (Ibid.)

As for the PG&E gas meter unit, no signs or markings alerted drivers of its presence. (Complaint at ¶ 24.) Rather, all that protected the gas meter was a small enclosure of chain-link fence. (Ibid.)

The explosion was triggered when a car in the 7-Eleven parking lot adjacent to the Plaza, driven by defendant Sara Desugura and owned by defendant Samual Donis, who was also present in the vehicle, struck an exposed and/or unmarked PG&E gas meter on the north side of the Plaza. (Complaint at ¶¶ 2, 22.)

PG&E was called out to shut off the gas, but it took several hours and use of a backhoe in numerous locations before PG&E discovered its own shut-off point, thereby allowing the fire to damage the entire Plaza over the course of five hours. (Complaint at ¶ 3.) By the time PG&E did cap the gas line, the Plaza was destroyed. (Ibid.) The fire decimated five local small businesses; four of which are plaintiffs named in this action and all of which were lessees of the Plaza. (Id. at ¶ 21.)

This was not the first time that a 7-Eleven consumer drove a vehicle from the 7-Eleven parking lot into the north side of the Plaza. (Complaint at ¶ 28.) There were at least two other incidents involving cars from the 7-Eleven parking lot striking the northern side of the Plaza that occurred between 2010 and 2015. (Ibid.) In one of these incidents, the motorist struck an exposed electrical box adjacent to the subject gas meter, which caused damage to the electrical box and required the attention of PG&E and Florence Sordello (“Sordello”), the landlord and owner of the Plaza, at the scene. (Ibid.)

Despite these prior instances and the obvious danger of having an exposed gas meter immediately adjacent to a parking lot, neither PG&E, 7-Eleven nor Sordello, undertook any mitigation efforts against this hazard. (Id. at ¶ 29.)

The operative Complaint sets forth causes of action for: (1) negligence; (2) premises liability; (3) private nuisance; (4) public nuisance; (5) trespass; (6) inverse condemnation; and (7) negligent entrustment. Various cross-complaints were also filed in this action.

On February 4, 2019, defendant PG&E filed a Notice of Bankruptcy Stay.

Motion for Summary Judgment

Currently before the Court is the motion for summary judgment to the Complaint by defendant Sordello, individually, and in her capacity as trustee of the Sordello Family Trust. The second, third, and fourth causes of action are directed to defendant Sordello. Plaintiffs filed written opposition and objections to evidence. Defendant 7-Eleven filed written opposition, a request for judicial notice, and objections to evidence. Defendant Sordello filed reply papers and objections to evidence. Trial is set for April 15, 2019.

7-Eleven’s Request for Judicial Notice

In opposition, defendant 7-Eleven filed a request for judicial notice of certain documents, orders, and pleadings in this action. The request is GRANTED with respect to Exhibit 3 as Plaintiffs’ Complaint constitutes a record of the superior court subject to judicial notice under Evidence Code section 452, subdivision (d). (See Stepan v. Garcia (1974) 43 Cal.App.3d 497, 500 [the court may take judicial notice of its own file].) The Court declines to take judicial notice of the remaining Exhibits as they are not material in resolving issues raised by the motion for summary judgment. (See Gbur v. Cohen (1979) 93 Cal.App.3d 296, 301 [judicial notice is confined to those matters which are relevant to the issue at hand].)

Plaintiffs’ Evidentiary Objections

In opposition, Plaintiffs filed objections to evidence submitted in the moving papers. The objections appear to be well-taken and thus they are SUSTAINED.

7-Eleven’s Evidentiary Objections

In opposition, defendant 7-Eleven filed objections to evidence submitted in the moving papers. Objection Nos. 1-3 are SUSTAINED. The Court declines to rule on the remaining objections as they are not material in resolving issues raised by the motion. (See Code Civ. Proc., § 437c, subd. (q) [in granting or denying a motion for summary judgment or summary adjudication, the court need rule only on those objections to evidence that it deems material to its disposition of the motion].)

Sordello’s Evidentiary Objections

In reply, defendant Sordello submitted objections to evidence submitted in the opposition papers. The Court declines to rule on the objections as they are not material in resolving issues raised by the motion. (See Code Civ. Proc., § 437c, subd. (q) [in granting or denying a motion for summary judgment or summary adjudication, the court need rule only on those objections to evidence that it deems material to its disposition of the motion].)

Legal Standard

Any party may move for summary judgment. (Code Civ. Proc., § 437c, subd. (a); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843 (Aguilar).) The motion “shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 437c, subd. (c); Aguilar, supra, at p. 843.) The object of the summary judgment procedure is “to cut through the parties’ pleadings” to determine whether trial is necessary to resolve the dispute. (Aguilar, supra, at p. 843.)

The “party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact…” (Aguilar, supra, 25 Cal.4th at p. 850; see Evid. Code, § 110.) “A prima facie showing is one that is sufficient to support the position of the party in question.” (Aguilar, supra, at p. 851.) A defendant moving for summary judgment may satisfy its initial burden either by producing evidence of a complete defense or by showing the plaintiff’s inability to establish a required element of the case. (Code Civ. Proc., § 437c, subd. (p)(2); Aguilar, supra, at p. 853.)

If a moving defendant makes the necessary initial showing, the burden of production shifts to the plaintiff to make a prima facie showing of the existence of a triable issue of material fact. (Code Civ. Proc., § 437c, subd. (p)(2); see Aguilar, supra, 25 Cal.4th at p. 850.) A triable issue of material fact exists “if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Aguilar, supra, at p. 850, fn. omitted.) If the plaintiff opposing summary judgment presents evidence demonstrating the existence of a disputed material fact, the motion must be denied. (Id. at p. 856.)
Throughout the process, the trial court “must consider all of the evidence and all of the inferences drawn therefrom.” (Aguilar, supra, 25 Cal.4th at p. 856.) The moving party’s evidence is strictly construed, while the opponent’s is liberally construed. (Id. at p. 843.)

Issues Framed by the Pleadings

“[A] summary judgment motion is directed to the issues framed by the pleadings. [Citation.] These are the only issues a motion for summary judgment must address. [Citation.]” (Canales v. Wells Fargo Bank, N.A. (2018) 23 Cal.App.5th 1262, 1268-1269.) “Accordingly, the burden of a defendant moving for summary judgment only requires that he or she negate plaintiff’s theories of liability as alleged in the complaint; that is, a moving party need not refute liability on some theoretical possibility not included in the pleadings. [Citations.]” (Hutton v. Fidelity National Title Co. (2013) 213 Cal.App.4th 486, 493.)

Plaintiffs allege claims for premises liability and public and private nuisance against defendant Sordello. With respect to premises liability, Plaintiffs allege Sordello and other defendants owned, leased, occupied, controlled, operated, managed and/or maintained the Plaza. (Complaint at ¶ 40.) Defendant Sordello allegedly allowed an unreasonably dangerous condition to exist on the property by failing to properly inspect, maintain, and/or repair said property, including but not limited to: (a) failing to properly maintain or protect the subject gas meter; (b) failing to properly maintain or erect a safety barrier at or near the subject gas meter; (c) failing to properly maintain or erect a warning at or near the subject gas meter; and/or (d) failing to maintain, install, erect and/or repair a barrier and/or enclosure to the parking lot approximately ten feet adjacent to a gas meter. (Id. at ¶ 44.)

With respect to the nuisance claims, Plaintiffs allege Sordello and other defendants created a condition that (a) was indecent and/or offensive to the senses; (b) was an obstruction of the free use of property, so as to interfere with the comfortable enjoyment of life or property; and/or (c) unlawfully obstructed the free passage or use, in the customary manner, of public streets and sidewalks in and around the Plaza. (Complaint at ¶¶ 48, 55.) As to the private nuisance cause of action, Plaintiffs allege this permanent condition interfered with their free use and enjoyment of the property. (Id. at ¶ 49.) Also, as to the public nuisance claim, Plaintiffs allege this condition affected a substantial number of people at the same time as the community endured fire and smoke for approximately five hours resulting in lost retail and service businesses in the area where they live and raise their families. (Id. at ¶ 56.)

With these issues in mind, defendant Sordello moves for summary judgment on the ground such claims are barred by the exculpatory clause in the parties’ lease agreement.

Exculpatory Clauses

“The general rule in California is that all persons are responsible ‘for an injury occasioned to another by his or her want of ordinary care or skill in the management of his or her property…’ [Citations.] However, parties may contract for the release of liability for future ordinary negligence so long as such contracts do not violate public policy. [Citations.] ‘A valid release precludes liability for risks of injury within the scope of the release.’ [Citation.]” (Anderson v. Fitness Internat., LLC (2016) 4 Cal.App.5th 867, 877.)

“The language of an agreement in order to exclude liability for negligence must be ‘clear and explicit’ and ‘free of ambiguity or obscurity.’ [Citation.] The law generally looks with disfavor on attempts to avoid liability or to secure exemption for one’s own negligence. [Citation.] The law requires exculpatory clauses to be strictly construed against the party relying on them. [Citation.]” (Philippine Airlines, Inc. v. McDonnell Douglas Corp. (1987) 189 Cal.App.3d 234, 237.)

“Whether an exculpatory clause ‘covers a given case turns primarily on contractual interpretation, and it is the intent of the parties as expressed in the agreement that should control. When the parties knowingly bargain for the protection at issue, the protection should be afforded. This requires an inquiry into the circumstances of the damage or injury and the language of the contract; of necessity, each case will turn on its own facts.’ [Citations.]” (Frittelli, Inc. v. 350 North Canon Drive, LP (2011) 202 Cal.App.4th 35, 44 (Frittelli).)

Analysis

Defendant Sordello argues her lease agreement with Plaintiffs contains an exculpatory clause which bars the claims for premises liability and nuisance. In support, Sordello submits evidence showing that she entered into the subject lease agreement with Plaintiffs in October 2014. (See Sordello’s Separate Statement of Undisputed Facts at Nos. 1-4.) As a preliminary matter, as pointed out in opposition, such evidence fails to demonstrate that Sordello entered into such agreement with plaintiff Mario Hidalgo. (See Plaintiffs’ Disputed Fact at No. 1; Plaintiffs’ OPP at p. 8, fn. 1; Plaintiffs’ Evid. Objections at Nos. 1-3; 7-Eleven’s Evid. Objections at Nos. 1-3.) This is because the lease agreement submitted by defendant Sordello fails to establish that plaintiff Mario Hidalgo signed the contract. (See Sordello’s Separate Statement of Undisputed Facts at No. 1 [Sordello Decl. at Ex. A].) Sordello thus fails to provide evidence showing plaintiff Mario Hidalgo was a party to the lease agreement or otherwise intended to be bound by the exculpatory clause. Therefore, at a minimum, defendant Sordello fails to meet her initial burden on summary judgment as to plaintiff Mario Hidalgo.

As to the remaining plaintiffs, defendant Sordello contends they are bound by the exculpatory clause set forth in section 19.02 of the lease agreement. Such language provides:

“Loss and Damage: Owner shall not be liable for any damage to property of Tenant or of others located on the leased premises, nor the loss of or damage to any property of Tenant or of others by theft or otherwise. Owner shall not be liable for any injury or damage to persons or property resulting from fire, explosions, falling plaster, steam, gas, electricity, water, rain or leaks from any part of the leased premises or from the pipes, appliances or plumbing works or from the roof, street or subsurface or from any other place or by dampness or by any other cause of whatsoever nature. Owner shall not be liable for any such damage caused by other tenants or persons in the leased premises, occupants of adjacent property, of the Shopping Center, or the public or caused by operations in construction of any private, public or quasi-public work. Owner shall not be liable for any latent defect in the leased premises or in the building of which they form a part. All property of Tenant kept or stored on the lease premises shall be so kept or stored at the risk of Tenant only and Tenant shall hold Owner harmless from any claims by Tenant’s insurance carriers, unless such damage shall be caused by the willful act or gross neglect of the Owner, and through no fault of Tenant.”

(See Sordello’s Separate Statement of Undisputed Facts at No. 5 [Sordello Decl. at Exs. A-D].)

Here, the language in Section 19.02 of the lease agreement appears to limit Plaintiffs’ right to recover damages attributed to their property or personal injury. Also, Plaintiffs would not be able to recover damages subject to any latent defects in the premises or building. For purposes of this action, Plaintiffs are not seeking relief for any latent defects in the leased premises. Plaintiffs however are seeking damages above and beyond property damage or personal injury. Such damages include the following: (1) loss of the use, benefit, goodwill, and enjoyment of Plaintiffs’ real and/or personal property; (2) loss of wages, earning capacity, and/or business profits or proceeds and/or any related displacement expenses; and (3) general damages for annoyance, disturbance, inconvenience, discomfort, and loss of quiet enjoyment of property. (Complaint at Prayer for Relief, Nos. 3-5.) In reply, defendant Sordello argues these other damages are incorporated as part of Section 19.02 as they arise from the fire and explosion in this case. (See Reply at pp. 7-8.) This argument is not persuasive as the plain language of the lease agreement refers specifically to injury to persons or property. As written, it is not clear if the parties intended to expand the scope of damages to items such as business profits, lost wages, or loss of goodwill. Therefore, the exculpatory clause at issue in Section 19.02 of the lease agreement does nothing to limit or restrict Plaintiffs’ ability to recover such damages in this action.

In addition, “[f]or an agreement to be construed as precluding liability for ‘active’ or ‘affirmative’ negligence, there must be express and unequivocal language in the agreement which precludes such liability. [Citations.] An agreement which seeks to limit liability generally without specifically mentioning negligence is construed to shield a party only for passive negligence, not for active negligence. [Citations.]” (Salton Bay Marina, Inc. v. Imperial Irrigation Dist. (1985) 172 Cal.App.3d 914, 932-933.)

“Whereas passive negligence involves ‘mere nonfeasance, such as the failure to discover a dangerous condition or to perform a duty imposed by law,’ active negligence involves ‘an affirmative act,’ knowledge of or acquiescence in negligent conduct, or failure to perform specific duties. [Citation.]” (Frittelli, supra, 202 Cal.App.4th at p. 48.) For example, “[p]assive negligence has been found or assumed from the failure to discover a defective condition created by others [citation], failure to exercise a right to inspect certain work and specify changes [citation], and failure to exercise a supervisory right to order removal of defective material [citation]. Active negligence has been found in digging a hole which later caused an injury [citation], knowingly supplying a scaffold which did not meet the requirements of a safety order [citation], creating a perilous condition that resulted in an explosion [citation], and failing to install safety nets in violation of a contract [citation].” (Rossmoor Sanitation, Inc. v. Pylon, Inc. (1975) 13 Cal.3d 622, 629 (Rossmoor).)

“Whether conduct constitutes active or passive negligence depends upon the circumstances of a given case and is ordinarily a question for the trier of fact; active negligence may be determined as a matter of law, however, when the evidence is so clear and undisputed that reasonable persons could not disagree. [Citations.]” (Rossmoor, supra, 13 Cal.3d at p. 629)

Section 19.02 of the lease agreement does not mention negligence and thus defendant Sordello would only be able to limit her liability for acts of passive negligence. However, it is not readily apparent from allegations in the Complaint if Plaintiffs are seeking relief based on passive negligence or active negligence. For example, if Sordello knowingly failed to properly maintain a warning or safety barrier near the subject gas meter, such actions may be construed as active negligence. In any event, the moving papers fail to address whether defendant Sordello should be released from liability based on alleged acts of passive or active negligence. Defendant Sordello argues in reply that the alleged acts constitute passive negligence. (See Reply at pp. 7, 9, 10.) The Court however declines to consider this argument as it is raised for the first time in the reply papers. (See Reichardt v. Hoffman (1997) 52 Cal.App.4th 754, 764 [points raised for the first time in reply brief will ordinarily not be considered, because such consideration would deprive the respondent of an opportunity to counter the argument].) Therefore, whether such actions constitute active or passive negligence remains an issue to be decided by the trier of fact at the time of trial.

Accordingly, defendant Sordello fails to meet her initial burden on the motion for summary judgment based on the exculpatory clause.

Disposition

The motion for summary judgment is DENIED. In light of this ruling, the Court declines to address Plaintiffs’ request to amend the Complaint raised in the opposition.

The Court will prepare the Order.

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