Case Name:   Professional Collection Consultants v. Lauron, et al.

Case No.:       1-11-CV-213127

 

 

Cross-defendant Chase Bank USA, N.A. (“Chase”) demurs to plaintiff and cross-complainant Professional Collection Consultants’ (“PCC”) Fourth Amended Cross-Complaint (“4ACC”) on the ground that there is another action pending between the parties (Code Civ. Proc, § 452, subd. (c) and, in the alternative, moves to stay the action.  Chase also moves to sever the 4ACC from the remainder of this action.  Lastly, Chase demurs to each cause of action in the 4ACC on the ground that each cause of action fails to state facts sufficient to constitute a cause of action.  (Code Civ. Proc, § 452, subd. (e).)

 

Chase’s requests for judicial notice are GRANTED.  (Evid. Code, § 452, subd. (d).)

 

PCC’s request for judicial notice is GRANTED.  (Evid. Code, § 452, subd. (d).)

 

1. Motion to Sever

 

Chase seeks to have PCC’s 4ACC against Chase severed from the remainder of this action.  Code of Civil Procedure section 1048, subdivision (b) provides:

 

The court, in furtherance of convenience or to avoid prejudice, or when separate trials will be conducive to expedition and economy, may order a separate trial of any cause of action, including a cause of action asserted in a cross-complaint, or of any separate issue or of any number of causes of action or issues, preserving the right of trial by jury required by the Constitution or a statute of this state or of the United States.

 

Pursuant to this section a complaint can be severed from a cross-complaint.  (See Omni Aviation Managers, Inc. v. Municipal Court (1976) 60 Cal. App. 3d 682, 684.)  Chase argues that the 4ACC should be severed from the underlying litigation because it greatly expands the scope of the case and threatens to overwhelm what otherwise would be a straightforward proceeding.  Chase’s argument is well taken.  The underlying Complaint is simply a collection action by PCC against defendant Krystal Lauron.  The 4ACC, on the other hand, involves PCC’s claims of unfair business practices and violations of RICO involving thousands of accounts and millions of dollars.  PCC argues that Lauron is an indispensable party; however, Lauron is not a party to the 4ACC.  The 4ACC only involves claims between PCC and Chase.  As pointed out by Chase, when the issues raised by a cross-complaint are “much more complicated” than those in the underlying litigation, a court is within its discretion to sever the cross-complaint from the rest of the litigation.  (See Roylance v. Doelger (1962) 57 Cal. 2d 255, 261-262.)  Accordingly, Chase’s motion to sever is GRANTED.

 

1. Demurrer on Ground of Another Action Pending and Alternative Motion to Stay

 

A plea in abatement pursuant to section 430.10, subdivision (c), may be made by demurrer or answer when there is another action pending between the same parties on the same cause of action.  In determining whether the causes of action are the same for purposes of pleas in abatement, the rule is that such a plea may be maintained only where a judgment in the first action would be a complete bar to the second action.  Where a demurrer is sustained on the ground of another action pending, the proper order is not a dismissal, but abatement of further proceedings pending termination of the first action.

 

(Plant Insulation Co. v. Fibreboard Corp. (1990) 224 Cal. App. 3d 781, 787-788, citations omitted.)

 

Similarly,

 

[u]nder the rule of exclusive concurrent jurisdiction, when two superior courts have concurrent jurisdiction over the subject matter and all parties involved in litigation, the first to assume jurisdiction has exclusive and continuing jurisdiction over the subject matter and all parties involved until such time as all necessarily related matters have been resolved. The rule is based upon the public policies of avoiding conflicts that might arise between courts if they were free to make contradictory decisions or awards relating to the same controversy, and preventing vexatious litigation and multiplicity of suits. The rule is established and enforced not so much to protect the rights of parties as to protect the rights of Courts of co-ordinate jurisdiction to avoid conflict of jurisdiction, confusion and delay in the administration of justice. The rule of exclusive concurrent jurisdiction may constitute a ground for abatement of the subsequent action.

 

(Plant Insulation Co. v. Fibreboard Corp., supra, 224 Cal. App. 3d at pp. 786-787, quotation marks and citations omitted.)

 

Although the rule of exclusive concurrent jurisdiction is similar in effect to the statutory plea in abatement, it has been interpreted and applied more expansively, and therefore may apply where the narrow grounds required for a statutory plea of abatement do not exist. Unlike the statutory plea of abatement, the rule of exclusive concurrent jurisdiction does not require absolute identity of parties, causes of action or remedies sought in the initial and subsequent actions. If the court exercising original jurisdiction has the power to bring before it all the necessary parties, the fact that the parties in the second action are not identical does not preclude application of the rule. Moreover, the remedies sought in the separate actions need not be precisely the same so long as the court exercising original jurisdiction has the power to litigate all the issues and grant all the relief to which any of the parties might be entitled under the pleadings.

 

(Plant Insulation Co. v. Fibreboard Corp., supra, 224 Cal. App. 3d at p. 788, quotation marks and citations omitted.)

 

The instant action was filed on November 14, 2011.  A similar debt-collection action against Robert M. Lujan was filed in San Francisco County Superior Court on June 21, 2011.  Another debt-collection action was filed against Scott L. Brown in Santa Barbara County Superior Court on July 31, 2012.  Therefore, the first-filed action is the San Francisco action.

 

A comparison of the cross-complaints in these cases shows that the parties are the same – PCC and Chase.  Further, the factual and legal issues are essentially the same.  All of the cases deal with thousands of credit card accounts on which an allegedly illegal late charge of $39 was imposed.  Accordingly, the demurrer is SUSTAINED and any further proceedings related to the 4ACC are stayed.

 

1. Demurrer on Ground of Failure to State Facts Sufficient to Constitute a Cause of Action 

 

In light of the order of abatement, the hearing on the demurrer on the ground of failure to state facts sufficient to constitute a cause of action is CONTINUED with the new hearing date to be determined after the stay on proceedings related to the 4ACC is lifted.