Case Number: BC640522 Hearing Date: August 09, 2018 Dept: 47

Michael F. Sedrak, M.D., et al. v. Donald Davison, M.D., et al.

MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, SUMMARY ADJUDICATION

MOVING PARTY: Plaintiffs/Cross-Defendants Michael Sedrak, M.D., and individual, and Michael F. Sedrak, M.D., a professional corporation

RESPONDING PARTY(S): Cross-Complainants Donald Davidson, M.D., a professional corporation, and Donald Davidson, M.D., an individual

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

Plaintiffs allege that Defendants breached a partnership agreement by terminating the partnership and continuing to conduct the partnership business without Plaintiffs.

Cross-Complainants Donald Davidson, M.D., a professional corporation, and Donald Davidson, M.D., an individual, Sankar Sridaran, M.D., Maysa Alavi, M.D., and Christopher McNamara, M.D. filed a Cross-Complaint alleging that Plaintiffs breached their partnership obligations and have failed to distribute income earned by Cross-Complainants.

Plaintiffs/Cross-Defendants Michael Sedrak, M.D., and individual, and Michael F. Sedrak, M.D., a professional corporation move for summary judgment or, in the alternative, summary adjudication.

TENTATIVE RULING:

Plaintiffs/Cross-Defendants Michael Sedrak, M.D., and individual, and Michael F. Sedrak, M.D., a professional corporation’s motion for summary judgment is DENIED. The alternative motion for summary adjudication is DENIED in its entirety.

DISCUSSION:

Motion For Summary Judgment/Summary Adjudication

Cross-Defendants’ Evidentiary Objections

Declaration of Donald Davidson

No. 1: SUSTAINED. Hearsay.

Page Limit

As has become a regrettable trend as of late among parties in general, Cross-Complainants filed a 22-page brief without obtaining the Court’s permission.

CRC Rule 3.1113(d) sets forth a 20-page limit on points and authorities in support of or in opposition to summary judgment motions, unless the party applies for an application to file a longer memorandum, which did not occur here. CRC Rule 3.1113(d) & (e). A memorandum filed in excess of the page limits “must be filed and considered in the same manner as a late-filed paper.” CRC Rule 3.1113(g). The Court has discretion to disregard a late-filed brief. CRC Rule 3.1300(d). Accordingly, while the Court could completely disregard the entirety of the opposition, instead, the Court will only read the first 20 pages of the Opposition. Nonetheless, the Court will consider all admissible evidence in support of the opposition (i.e., that evidence as to which evidentiary objections have been overruled).

Analysis

CRC Rule 3.1350(b) provides:

If made in the alternative, a motion for summary adjudication may make reference to and depend on the same evidence submitted in support of the summary judgment motion. If summary adjudication is sought, whether separately or as an alternative to the motion for summary judgment, the specific cause of action, affirmative defense, claims for damages, or issues of duty must be stated specifically in the notice of motion and be repeated, verbatim, in the separate statement of undisputed material facts.

(Bold emphasis and underlining added.)

CRC Rule 3.1350(d) provides:

The Separate Statement of Undisputed Material Facts in support of a motion must separately identify each cause of action, claim, issue of duty, or affirmative defense, and each supporting material fact claimed to be without dispute with respect to the cause of action, claim, issue of duty, or affirmative defense. In a two-column format, the statement must state in numerical sequence the undisputed material facts in the first column followed by the evidence that establishes those undisputed facts in that same column. Citation to the evidence in support of each material fact must include reference to the exhibit, title, page, and line numbers.

(Bold emphasis and underlining added.)

Here, the Separate Statement does not identify each cause of action as to which Defendants are moving for summary adjudication, as required by CRC Rule 3.1350(d) & (e). Accordingly, the separate statement does not support summary adjudication, and the Court treats this as a motion for summary judgment only.

The Court finds that Cross-Defendants have not met their initial burden of demonstrating that they are entitled to summary judgment (or even summary adjudication if the Court were to entertain such). A summary judgment or summary adjudication motion must address the “issues framed by the pleadings since it is these allegations to which the motion must respond by establishing a complete defense or otherwise showing there is no factual basis for relief on any theory reasonably contemplated by the opponent’s pleading.” Carleton v. Tortosa (1993) 14 Cal.App.4th 745, 753 (bold emphasis and underlining added). “Under the statute, the burden does not shift to a plaintiff resisting summary judgment until a moving defendant has met his or her initial burden to negate the plaintiff’s action.” Rubenstein v. Rubenstein (2000) 81 Cal.App.4th 1131, 1142 (bold emphasis and underlining added).

The first cause of action alleges that Cross-Defendants breached the partnership agreement in the following ways:

¿ Failing to reimburse the Davidson Cross-Complainants for substantial funds expended by the Davidson Cross-Complainants on business expenses. Cross-Complaint, ¶ 21. The separate statement does not cite evidence demonstrating that Cross-Defendants reimbursed Cross-Complainants’ business expense expenditures as allegedly agreed to by the parties.

¿ Failing to adequately contribute their medical expertise and labor to the partnership. Id. The separate statement does not cite evidence demonstrating that Cross-Defendants “adequately contributed their medical expertise and labor to the partnership.” (Bold emphasis added.)

¿ Failing to work on scheduled days and times. Id. The separate statement does not cite evidence demonstrating that Cross-Defendants worked on all scheduled days and times.

¿ Refusing to allow the Davidson Cross-Complainants to take appropriate steps to expand the business. Id. The separate statement does not cite evidence demonstrating that Cross-Defendants allowed Cross-Complainants to take appropriate steps to expand the business.

¿ Failing to pay funds due to the Davidson Cross-Complainants under the agreement. Id. The separate statement does not cite evidence demonstrating that Cross-Defendants have paid all funds due to the Cross-Complainants under the agreement.

The second cause of action alleges that Cross-Defendants breached their fiduciary duty by:

¿ Failing to contribute their skills, efforts and labor to the business. Cross-Complaint, ¶ 25. The separate statement does not cite evidence demonstrating that Cross-Defendants have contributed their skills, efforts and labor to the business in a quantity and quality consistent with the fiduciary duties of a partner.

¿ Failing to remit funds due. Id. The separate statement does not cite evidence demonstrating that Cross-Defendants have paid all funds due to the Cross-Complainants under the agreement.

The third cause of action alleges that Cross-Defendants made the following false promises without intend to perform:

¿ That Cross-Defendants would be responsible for 50% of the business expenses. Cross-Complaint, ¶ 29.a. The separate statement does not cite evidence demonstrating that Cross-Defendants have paid 50% of all business expenses.

¿ That Cross-Defendants would contribute their medical expertise and labor to the partnership. ¶ 29.b. The separate statement does not cite evidence demonstrating the quantity and quality in which Cross-Defendants have contributed their medical expertise and labor to the partnership.

¿ That Cross-Defendants would make their best efforts to expand the business. ¶ 29.c. The separate statement does not cite evidence demonstrating that Cross-Defendants used their “best efforts” to expand the business.

¿ That Cross-Defendants would remit funds due to the Davidson Cross-Complainants under the agreement. ¶ 29.d. The separate statement does not cite evidence demonstrating that Cross-Defendants have paid all funds due to the Cross-Complainants under the agreement.

The fourth cause of action for conversion alleges that, as a result of their control of the partnership’s bank accounts and finances, Cross-Defendants received funds from patients, and portions of those funds were to be distributed to all Cross-Complainants, either as flat fees per patient to Cross-Complainants Sirdaran, Alvai and McNamara—or as half of the partnership profits to the Davidson Cross-Complainants. Cross-Complaint, ¶ 37. After the partnership had been terminated, Cross-Defendants continued to receive funds earned from services provided by Cross-Complainants during the existence of the partnership, which funds belong to Cross-Complainants and were to be turned over to Cross-Defendants immediately upon receipt. ¶¶ 38, 39. However, without Cross-Complainant’s consent, Cross-Defendants failed and continue to refuse to remit the funds to Cross-Complainants. ¶ 41.

The separate statement does not cite evidence demonstrating that Cross-Defendants have paid all funds due to the Cross-Complainants under the agreement. Although Cross-Defendants claim in their points and authorities that the remainder of the contested funds have been placed in a segregated account, pending judicial determination of ownership, this does not negate a conversion claim because good intentions are not a defense to conversion. In fact, it may very well be an admission of conversion of the amount of the contested funds; at the very least, it raises a triable issue of material fact as to conversion:

Conversion is the wrongful exercise of dominion over the property of another. The elements of a conversion claim are: (1) the plaintiff’s ownership or right to possession of the property; (2) the defendant’s conversion by a wrongful act or disposition of property rights; and (3) damages. Conversion is a strict liability tort. The foundation of the action rests neither in the knowledge nor the intent of the defendant. Instead, the tort consists in the breach of an absolute duty; the act of conversion itself is tortious. Therefore, questions of the defendant’s good faith, lack of knowledge, and motive are ordinarily immaterial. (Citations omitted.)

Burlesci v. Peterson (1998) 68 Cal.App.4th 1062, 1066 (bold emphasis and underlining added).

Moreover, Cross-Defendant is not entitled to summary judgment because the notice of motion does not even identify the fifth cause of action for money had and received or the sixth cause of action for an accounting as causes of action to which Cross-Defendants are seeking to have judgment entered in their favor. “To prevail on a summary judgment motion that does not request summary adjudication in the alternative, the defendant must show conclusively that all of the plaintiff’s causes of action or legal theories fail as a matter of law.” Slovensky v. Friedman (2006) 142 Cal.App.4th 1518, 1526.

For the foregoing reasons, Cross-Defendants have failed to meet their initial burden of demonstrating that they are entitled to either summary judgment or summary adjudication as to any causes of action. The burden does not shift to Cross-Complainants to raise a triable issue of material fact.

The motion for summary judgment is DENIED. The alternative motion for summary adjudication is DENIED in its entirety.

Moving party to give notice, unless waived.

IT IS SO ORDERED.

Dated: August 9, 2018 ___________________________________

Randolph M. Hammock

Judge of the Superior Court