Tentative Ruling

Judge Colleen Sterne
Department 5 SB-Anacapa
1100 Anacapa Street P.O. Box 21107 Santa Barbara, CA 93121-1107

CIVIL LAW & MOTION
Pico Rivera First Mortgage Investors LP v. Henry Aguila
Case No: 18CCV04958
Hearing Date: Mon Feb 10, 2020 9:30

Nature of Proceedings: Motion Leave to File Second Amended Cross-Complaint

Pico Rivera First Mortgage Investors, LP, v. Aguila (Judge Sterne)

Case No. 18CV04958

Hearing Date: February 10, 2020

HEARING: Motion of Cross-Complainant Henry Aguila for Leave to File a Second Amended Cross-Complaint

ATTORNEYS:

For Plaintiff and Cross-Defendant Pico Rivera First Mortgage Investors LP and Cross-Defendants Mortgage Co. of Santa Barbara and Carl Lindros: Eric A. Woosley

For Defendant and Cross-Complainant Henry Aguila: Self-represented

For Cross-Defendant Forward Beverly Hills, Inc., dba Keller Williams Realty and dba Keller Williams Commercial: Andrew L. Leff, Spile, Leff & Goor, LLP

For Specially-Appearing Cross-Defendants Wolf Baschung, Guru Thapar, and Forward Beverly Hills, Inc.: Rinat Klier-Erlich, Michael Zaiderman, Manning & Kass Ellrod, Ramirez, Trester LLP

TENTATIVE RULING:

The motion of cross-complainant Henry Aguila for leave to file a second amended cross-complaint is denied without prejudice to the filing of a new motion setting forth the items required by California Rules of Court, rule 3.1324, as discussed herein.

Background:

On October 10, 2018, plaintiff Pico Rivera First Mortgage Investors LP (PRFM) filed its original complaint in this action asserting one cause of action for breach of guaranty against defendant Henry Aguila.

On January 14, 2019, Aguila filed his answer to the complaint, generally denying the allegations of the complaint and asserting 32 affirmative defenses. Aguila concurrently filed his original cross-complaint against cross-defendants Blackwood, Keller Williams Realty, Keller Williams Commercial, Wolf Baschung, Guru Thapar, PRFM, Mortgage Co. of Santa Barbara, Inc., and Carl Lindros, asserting seven causes of action: (1) breach of oral contract (specific performance requested); (2) breach of fiduciary duty; (3) fraud and deceit; (4) negligent misrepresentation; (5) unfair business practices; (6) interference with prospective advantage; and, (7) constructive trust.

On February 4, 2019, PRFM filed a notice of related cases, identifying the case of Hernandez, et al., v. Blackwood, et al., Los Angeles County Superior Court case number VC067404, as a related case.

Also on February 4, 2019, without any party having responded to the original complaint, Aguila filed his first amended cross-complaint (FACC), which appears to be the same text as the original cross-complaint, but with the page 22 that was missing from the original cross-complaint included in the FACC.

On March 7, 2019, PRFM, Mortgage Co. of Santa Barbara, and Lindros filed their answer to the FACC, generally denying the allegations thereof and asserting 14 affirmative defenses.

On April 22, 2019, Aguila requested, and the court entered, dismissal without prejudice as to cross-defendants Keller Williams Realty and Commercial, Baschung, and Thapar.

On May 21, 2019, Aguila filed an amendment to the FACC identifying PR Mixed Use LLC as “Doe 1.”

On May 22, 2019, Aguila filed amendments to the FACC identifying ERDM Inc. as “Doe 3,” Santiago Acuna as “Doe 4,” Edgar Fragoso as “Doe 5,” and Eva Meneses as “Doe 6.”

On May 23, 2019, Aguila filed amendments to the FACC identifying Forward Beverly Hills, Inc. dba Keller Williams Realty as “Doe 2” and identifying Forward Beverly Hills, Inc. dba Keller Williams Commercial as “Doe 7.”

On August 5, 2019, at a case management conference, the court set trial for March 23, 2020.

On August 19, 2019, Aguila requested, and the court entered, dismissal without prejudice as to cross-defendant PR Mixed Use LLC.

On August 27, 2019, Aguila filed amendments to the FACC identifying Wolf Baschung, previously dismissed without prejudice, as “Doe 8” and identifying Guru Thapar, previously dismissed without prejudice, as “Doe 9.”

On September 18, 2019, Aguila requested, and the court entered, dismissal without prejudice as to cross-defendant Blackwood.

On December 10, 2019, PRFM filed a notice related cases, identifying the case of Three Aguila, Inc., v. Blackwood LLC, et al., Los Angeles County Superior Court case number 19NWCV00417, as a related case.

On December 13, 2019, the court ordered, on the parties’ stipulation, a continuance of trial, and related dates, to July 20, 2020.

On January 13, 2020, Aguila filed this motion for leave to file a second amended cross-complaint. The proposed second amended cross-complaint (PSACC) is attached to the motion as exhibit A.

On January 16, 2020, Forward Beverly Hills Inc. dba Keller Williams Commercial and dba Keller Williams Realty (FBH) filed is answer to the FACC, generally denying the allegations thereof and asserting 14 affirmative defenses.

Aguila’s motion for leave is opposed by (1) cross-defendants PRFM, Mortgage Co. of Santa Barbara, and Carl Lindros (the Lender parties), and (2) by “specially-appearing” cross-defendants Baschung, Thapar, and FBH.

Analysis:

The opposing parties argue that the motion is both procedurally and substantively improper.

“A motion to amend a pleading before trial must:

“(1) Include a copy of the proposed amendment or amended pleading, which must be serially numbered to differentiate it from previous pleadings or amendments;

“(2) State what allegations in the previous pleading are proposed to be deleted, if any, and where, by page, paragraph, and line number, the deleted allegations are located; and

“(3) State what allegations are proposed to be added to the previous pleading, if any, and where, by page, paragraph, and line number, the additional allegations are located.” (Cal. Rules of Court, rule 3.1324(a).)

“A separate declaration must accompany the motion and must specify:

“(1) The effect of the amendment;

“(2) Why the amendment is necessary and proper;

“(3) When the facts giving rise to the amended allegations were discovered; and

“(4) The reasons why the request for amendment was not made earlier.” (Cal. Rules of Court, rule 3.1324(b).)

The court agrees that the motion is procedurally improper. The motion states that Aguila engaged in written discovery as a result of which undiscovered and additional facts came to light necessitating the filing of the PSACC. (Motion, p. 3.) The declaration of Aguila states that the PSACC replaces the seventh cause of action (constructive trust) with a cause of action for express contractual indemnity against ERDM, Fragoso, Acuna, and Menses, adds operative facts, and corrects corporate identities for the Keller Williams cross-defendants. (Aguila decl., ¶¶ 7-8.) Although the motion generally identifies these items, it is clear that the PSACC asserts claims against parties who had been previously dismissed and fails to identify specifically where in the PSACC changes have been made apart from the seventh cause of action. Page, paragraph, and line numbers are needed (and a redlined version helpful) in order for the court and the parties to identify specifically what changes are included in the PSACC.

With respect to the timing of the amendment, Aguila generally identifies discovery and settlement efforts, but fails to identify what discovery occurred—apart from the deposition of Gilad Garnish relating to Lindros and Baschung—and how that discovery necessitated the amendments. (See Aguila decl., ¶ 5.) In particular, Aguila fails to explain why cross-defendants were voluntarily dismissed, why some of these cross-defendants were re-inserted into the cross-complaint as “Doe” defendants, and what specifically led to this motion being filed now.

The court therefore will deny the motion for leave to file the PSACC without prejudice to the filing of a new motion setting forth the items required by rule 3.1324.

With respect to the substantive issues, the court notes at least some of the PSACC would be appropriate to clarify the role of cross-defendants and their identities, and to provide allegations regarding Doe defendants for which there may now be insufficient allegations. The court notes with respect to contested legal issues arising from the allegations in the PSACC that the better practice is to permit an amendment and address such legal issues by demurrer or other motion properly suited to legal challenges. (See Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048.) The court therefore does not address these issues here.