Case Name: Sandra Carbone v. O’Connor Hospital Foundation, et al.
Case No.: 2015-1-CV-281925

I. Background

This is an elder abuse action arising out of a dispute over the termination of annuity payments brought by Sandra Carbone (“Plaintiff”) against O’Connor Hospital Foundation (“Defendant”). On July 1, 1991, the parties created a charitable remainder annuity trust identified as the Eugene H. and Sandra Carbone Irrevocable Annuity Trust. (Compl., ¶¶ 5-6.) Pursuant to the terms of the trust agreement, Plaintiff transferred to Defendant four parcels of real property valued at $1,225,000.00. (Compl., ¶ 7.) In exchange, Defendant agreed to pay Plaintiff $108,696.00 annually for her lifetime. (Compl., ¶ 8.) Upon the later of the death of Mr. Carbone or Plaintiff or the date marking 20 years from the creation of the trust, any remaining trust assets would be distributed to Defendant. (Compl., ¶ 12.) On January 18, 2000, attorney Stanley Weithorn (“Weithorn”), Defendant’s planned giving counsel who drafted the trust agreement, wrote to Plaintiff confirming her entitlement to the annuity payments for her lifetime. (Compl., ¶ 9.) In July 2011, Defendant refused to make any more annuity payments to Plaintiff. (Compl., ¶¶ 13-14.) Plaintiff asserts a sole cause of action for financial elder abuse against Defendant.

Defendant moves for summary judgment on the ground the statute of limitations and doctrine of laches provide a complete defense to Plaintiff’s claim. Defendant’s motion is accompanied by a request for judicial notice. Plaintiff opposes the motion and objects to portions of Defendant’s evidence.

II. Discussion

A. Standard of Review

“A party may move for summary judgment in any action or proceeding if it is contended that the action has no merit. . . .” (Code Civ. Proc., § 437c, subd. (a)(1).) An action has no merit if the defendant can show there is a complete defense to the action. (Code Civ. Proc., § 437c, subd. (o)(2); see also Drake v. Pinkham (2013) 217 Cal.App.4th 400, 402 [summary judgment proper if claim barred by statute of limitations or doctrine of laches].)

A defendant moving for summary judgment bears the initial burden of showing he or she has a complete defense to the action. (Code Civ. Proc., § 437c, subd. (p)(2); see also Raghavan v. Boeing Co. (2005) 133 Cal.App.4th 1120, 1132.) “If the defendant fails to make this initial showing, it is unnecessary to examine the plaintiff’s opposing evidence and the motion must be denied.” (Intrieri v. Superior Court (2004) 117 Cal.App.4th 72, 82.) “However, if the moving papers establish a prima facie showing that justifies a judgment in the defendant’s favor, the burden then shifts to the plaintiff to make a prima facie showing of the existence of a triable material factual issue.” (Ibid.; see also Code Civ. Proc., § 437c, subd. (p)(2).)

B. Evidentiary Matters

1. Defendant’s Request for Judicial Notice

Defendant requests judicial notice of the complaint. The complaint is a court record that is relevant to the pending matter and is therefore the proper subject of judicial notice. (See Evid. Code, § 452, subd. (d) [permitting judicial notice of court records]; see also People ex rel. Lockyer v. Shamrock Foods Co. (2000) 24 Cal.4th 415, 422, fn. 2 [matter must be relevant to be judicially noticed].)

Defendant also requests judicial notice of the obituary of Weithorn, the attorney who drafted the trust agreement. The obituary is a printout from the website of the New York Times. Defendant appears to be requesting judicial notice of this matter as evidence that Weithorn is deceased, which is relevant to its argument that Plaintiff’s claim is barred by the doctrine of laches. Defendant does not, however, articulate a specific statutory basis for its request.

The only conceivable statutory basis for Defendant’s request is Evidence Code section 452, subdivision (h), which states a court may take judicial notice of “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” Even so, courts generally do not take judicial notice of the truth of the contents of websites or public documents. (See Searles Valley Minerals Operations, Inc. v. State Bd. of Equalization (2008) 160 Cal.App.4th 514, 519.) Consequently, even though Plaintiff does not dispute Weithorn is deceased, the Court may not take judicial notice of the truth of the statements in the obituary, including statements as to the date or fact of Weithorn’s death. The Court denies the request for judicial notice of the obituary.

In conclusion, Defendant’s request for judicial notice is GRANTED as to the complaint and DENIED as to the obituary.

2. Plaintiff’s Objections to Evidence

Plaintiff objects to the admissibility of portions of Defendant’s evidence attached to the declaration of Henry M. Su.

As a threshold matter, Plaintiff’s objections are not properly presented. Objections to evidence in connection with a motion for summary judgment must be presented in a separate document and must be properly formatted. (See Cal. Rules of Court, rule 3.1354(b).) This means objections cannot be stated and argued in a separate statement. (Ibid.; see also Hodjat v. State Farm Mutual Automobile Ins. Co. (2012) 211 Cal.App.4th 1, 8-9.) Here, Plaintiff stated her objections in her separate statement; she did not file a separate document setting forth her objections. Consequently, Plaintiff’s objections are not properly presented.

Additionally, in setting forth objections, a party must identify the document and exhibit in which the objectionable material is located, quote or identify the objectionable statement, and state the ground for the objection. (See Cal. Rules of Court, rule 3.1354(b)(1)-(4).) Plaintiff did not include all of the required information in her objections and they are therefore deficient in this regard as well.

It is within a court’s discretion to decline to rule on objections improperly presented in a separate statement. (Hodjat v. State Farm Mutual Automobile Ins. Co., supra, 211 Cal.App.4th at pp. 8-9.) Nonetheless, the Court will exercise its discretion to rule on Plaintiff’s objections, although improperly presented, given their limited scope. Plaintiff shall comply with the California Rules of Court going forward.

Turning to the merits of her objections, Plaintiff objects to the trust agreement attached as part of Exhibit E to the declaration of Henry M. Su on the ground it “is not a copy of the Trust and does not contain the terms of the Trust.” (Pl. Sep. Stat. at p. 2:4-6.) Plaintiff thus appears to be objecting to the authenticity of the trust agreement, but does not otherwise explain her objection.

For context, Plaintiff produced a 19-page document entitled “Irrevocable Annuity Trust Agreement” in response to Defendant’s requests for the production of documents, set one. (Su Decl., Exh. B.) Defendant then served Plaintiff with requests for admissions, set three (“RFA”). (Su Decl., Exh. E.) As relevant here, RFA No. 15 asked Plaintiff to authenticate the trust agreement. (Su Decl., Exh. E.) The document attached to RFA No. 15 consisted of the following pages: (1) the 19-page document produced by Plaintiff; (2) a single page, without a page number, entitled “Schedule A” identifying three parcels of real property; (3) an apparent continuation of “Schedule A” identifying a fourth parcel of real property and bearing the page number 22; and (4) an unpaginated document identified as “Exhibit A-Description of Properties” containing four descriptions of real property including tract and lot numbers. (Su Decl., Exh. E.)

In response to RFA No. 15, Plaintiff admitted the first 19 pages constituted a true and accurate copy of the trust agreement. (Su Decl., Exh. F.) Plaintiff also stated Schedule A appeared to be a true and accurate copy of Schedule A to the trust agreement, but could not confirm whether the document entitled “Exhibit A-Description of Properties” was originally part of the agreement. (Su Decl., Exh. F.) In responding to RFA No. 15, Plaintiff did not raise any issue with respect to the contents of these documents and merely noted an apparent defect in the continuous pagination of Schedule A and Exhibit A, which follow the first 19 pages of the trust agreement. (Su Decl., Exh. F.) To summarize, there was no dispute that the 19 pages culminating in an executed signature page made up the body of the trust agreement. Rather, Plaintiff took issue with the pagination of the property descriptions that followed.

A generic authenticity objection may be overcome by evidence that the objecting party has admitted a document’s authenticity at some point in time or relied upon it as authentic, such as by offering the evidence in support of his or her own motion. (See Ambriz v. Kelegian (2007) 146 Cal.App.4th 1519, 1527.) Here, while Plaintiff took issue with the pagination of the real property descriptions following the body of the trust agreement, she admitted its authenticity. Moreover, she relies upon the 19-page agreement as authentic because she submits it as evidence in support of her opposition to Defendant’s motion. Plaintiff does not further explain her objection and the real property descriptions following the terms of the agreement are not material to the disposition of the motion for summary judgment. Plaintiff’s objection therefore lacks merit and is overruled.

Additionally, Plaintiff objects to 3 letters sent in September, October, and December 2010 on the ground of the Secondary Evidence Rule. (See Su Decl., Exhs. C-D.) Generally, the Secondary Evidence Rule allows a party to prove the contents of a writing by “‘otherwise admissible secondary evidence.’” (People v. Skiles (2011) 51 Cal.4th 1178, 1187, quoting Evid. Code, § 1521, subd. (a).) The Secondary Evidence Rule does not operate to exclude evidence if there is no genuine dispute as to the material terms of the writing. (See In re Kirk (1999) 74 Cal.App.4th 1066, 1073.)

Here, Plaintiff affirmatively states she does not dispute the contents of these letters. Consequently, the applicability of the Secondary Evidence Rule is not immediately apparent. Additionally, to the extent Plaintiff is actually objecting to the authenticity of the letters, the basis for her objections is not obvious given she admitted their authenticity. (See Su Decl., Exh. D.) Plaintiff’s objections therefore lack merit and are overruled.

C. Merits of Motion for Summary Judgment

Defendant moves for summary judgment on the ground Plaintiff’s sole cause of action has no merit because it is barred by the statute of limitations and the doctrine of laches.

1. Defendant’s Initial Burden

i. Statute of Limitations

Defendant argues Plaintiff’s claim is barred by the statute of limitations because she filed her complaint more than four years after discovering its decision to terminate the annuity payments.

Pursuant to Welfare and Institutions Code section 15657.7, a plaintiff must bring an action for financial elder abuse within four years of the accrual of the cause of action. Generally, an elder abuse cause of action accrues when “the plaintiff discovers or, through the exercise of reasonable diligence, should have discovered, the facts constituting the financial abuse.” (Welf. & Inst. Code, § 15657.7.)

Defendant argues Plaintiff’s claim accrued in 2010 because that is when she discovered it planned to stop making annuity payments. In support of this argument, Defendant presents a letter it sent to Plaintiff in September 2010 stating it was “nearing the end of fulfilling [its] obligation to her and would be making three final annuity payments in the reduced amount of $3,992.25. (Su Decl., Exh. C.) Defendant also offers a letter from Plaintiff’s counsel from October 2010 threatening to file an elder abuse action based on the September 2010 letter. (Su Decl., Exh. C.) While these letters show Plaintiff was aware of reduced payments as early as 2010, the financial elder abuse alleged in this case is the failure to make recurring annuity payments; Plaintiff’s claim is not limited to the initial refusal and failure to tender the full annuity payment in 2010.

“‘When an obligation or liability arises on a recurring basis, a cause of action accrues each time a wrongful act occurs, triggering a new limitations period.’” (Aryeh v. Canon Business Solutions, Inc. (“Aryeh”) (2013) 55 Cal.4th 1185, 1199, quoting Hogar Dulce Hogar v. Community Dev. Com. (2003) 110 Cal.App.4th 1288, 1295.) “However, [ ] the theory of continuous accrual supports recovery only for damages arising from those breaches falling within the limitations period.” (Aryeh, supra, 55 Cal.4th at p. 1199 [compiling cases; plaintiff may recover for recurring private obligations, not just public obligations like pension payments].)

Here, Defendant’s own evidence undercuts its argument that Plaintiff’s claim is time-barred. More specifically, Defendant submits the trust agreement, which states annuity payments shall continue “until the last to occur of 1) the date of death of Eugene H. Carbone, 2) the date of death of Sandra Carbone or 3) the date which marks the twentieth (20th) anniversary of the date of execution of this Annuity Trust Agreement.” (Su Decl., Exh. E.) While it has been more than 20 years since the execution of the agreement, the agreement clearly states the payments shall continue until the last to occur of the three triggering events. Defendant offers no evidence that either Plaintiff or her husband are deceased. Consequently, Defendant fails to demonstrate its recurring obligation to make annuity payments terminated. Given Defendant’s continuing obligation to make annuity payments, each withheld payment triggered a new limitations period.

Plaintiff filed her complaint in June 2015. Accordingly, any unpaid annuity payments within the four preceding years fell within the limitations period and are not conclusively barred. While Plaintiff may ultimately be precluded from recovering damages for payments withheld in 2010, Defendant does not demonstrate all of the recurring violations took place outside of the limitations period. Defendant therefore does not carry its burden of showing Plaintiff’s entire claim is barred by the statute of limitations.

ii. Laches

Defendant argues Plaintiff’s claim is barred by the doctrine of laches. “The doctrine of laches bars equitable relief where the party seeking relief has been guilty of excessive, unjustified delay in asserting rights . . . .” (Potter v. Contra Costa Realty Co. (1934) 220 Cal. 31, 34.) Laches is not a defense to an action at law. (Pratali v. Gates (1992) 4 Cal.App.4th 632, 645.) “Whether an action is in law or equity . . . depends in large measure upon the mode of relief to be afforded [citations], is ascertained from the gist of the action as framed by the pleadings and the facts in the case [citations], but is not fixed by the prayer or the title.” (Paularena v. Superior Court (1965) 231 Cal.App.2d 906, 911-12 [discussing distinction between legal and equitable rescission].) “Where an action at law is adequate, relief in equity is not available [citations] and a request for equitable relief therein will not convert it to an action in equity. (Id. at p. 912.) An action to recover damages will not be deemed equitable where any equitable relief afforded the plaintiff is merely ancillary. (Id. at p. 914.)

Here, Plaintiff seeks damages and rescission of the trust agreement in connection with her statutory claim for financial elder abuse. The clear focus of her claim, however, is on damages. While rescission could theoretically be equitable in nature, in this instance it is ancillary. Simply listing rescission in the prayer for relief does not convert her claim into an equitable action.

To this point, Defendant acknowledges laches is limited to equitable actions by stating: “To the extent that this action could be deemed an equitable action, [it] can assert laches as a defense to the equitable claims.” (Mem. of Pts. & Auth. at p. 8:11-12.) Even so, Defendant provides no analysis with respect to the limited applicability of this defense. Defendant makes no attempt to explain and it is not otherwise obvious how the doctrine of laches provides a complete defense to this action. Moreover, other than stating the death of Weithorn is prejudicial, Defendant fails to address the elemental prerequisites of the doctrine of laches, such as how Plaintiff is guilty of unjustified delay. Defendant therefore fails to substantiate its argument and the motion for summary judgment cannot be granted on this basis.

2. Conclusion

In conclusion, Defendant’s motion for summary judgment is DENIED because it fails to carry its initial burden of demonstrating there is a complete defense to the action.

The Court will prepare the order.