Case Number: BC290553 Hearing Date: June 12, 2014 Dept: 58

JUDGE ROLF TREU
DEPARTMENT 58
________________________________________
Hearing Date: Thursday, June 12, 2014
Calendar No: 7
Case Name: Jogani v. Jogani, et al.
Case No.: BC290553
Motion: (1) Motion for Summary Adjudication
(2) Motion to Disqualify Counsel
Moving Party: Defendants Haresh Jogani; H.K. Realty, Inc.; Commonwealth Investments, Inc.; Mooreport Holdings Limited; Gilu Investments Limited; and J.K. Properties, Inc.
Responding Party: (1) Plaintiff Shashikant Jogani
(2) Plaintiff Shashikant Jogani and Respondent Steven E. Glass
Notice: OK

Tentative Ruling: (1) Motion for summary adjudication is denied.

(2) Motion to disqualify counsel is denied.
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I. BACKGROUND
On 2/18/03, Plaintiff Shashikant Jogani (also referred to as “Shashi”) filed this action arising out of an alleged partnership for the acquisition of real estate. The operative Second Amended Complaint was filed on 11/3/03 and asserted causes of action for (1) breach of contract, (2) breach of fiduciary duty, (3) fraud, (4) conspiracy to defraud, (5) dissolution of partnership, (6) quantum meruit, (7) unjust enrichment, and (8) constructive trust.

After years of law and motion, a jury trial commenced on 10/28/09 as to Plaintiff’s sole remaining cause of action for quantum meruit against Defendants J.K. Properties, Inc; H.K. Realty, Inc.; Hansa Investments, Inc.; Commonwealth Investments, Inc.; Mooreport Holdings Limited; and Gilu Investments Limited (collectively “Holding Companies”), and Haresh Jogani. On 11/20/09, the jury returned a special verdict partly in favor of Plaintiff. On 11/12/10, judgment was entered in favor of Plaintiff against J.K. Properties, H.K. Realty, Hansa Investments, and Commonwealth Investments; judgment was entered in favor of Mooreport Holdings, Gilu Investments, and Haresh against Plaintiff. On 2/19/10, the Court granted a motion for new trial filed by J.K. Properties, H.K. Realty, Hansa Investments, and Commonwealth Investments.

On 4/18/13, remittitur issued on the Court of Appeal’s opinion which affirmed in part and reversed in part the Court’s orders and judgment. See Jogani v. Jogani (2012) 2012 WL 6042366 (“Jogani IV”). The Court of Appeal affirmed the Court’s decision to vacate the verdict and ordered the matter to be retried. Id. at *12. The Court of Appeal reversed the Court’s summary adjudication in favor of Haresh as to Plaintiff’s claims for breach of contract, breach of fiduciary duty, fraud, and dissolution of partnership; and reversed the judgment in favor of Haresh, Mooreport Holdings, and Gilu Investments on the quantum meruit claim. Id. at *15, 16.

On 6/4/13, this action was assigned to this Court. Trial is set for 8/4/14; FSC for 7/17/14.

II. MOTION FOR SUMMARY ADJUDICATION
H.K. Realty, Inc.; Commonwealth Investments, Inc.; Mooreport Holdings Limited; Gilu Investments Limited; and J.K. Properties, Inc. (collectively “Holding Companies”) and Haresh (collectively “Moving Defendants”) move for summary adjudication as to the 1st through 5th COAs.

The Court notes that the Court of Appeal considered the 4th COA for conspiracy to defraud as alleged against Pinkal Jogani only (Jogani IV, 2012 WL 6042366 at *2) and affirmed the Court’s summary judgment/adjudication favor of Pinkal on the 4th COA (id. at *15). Therefore, only the 1st through 3rd and 5th COAs are the subject of Moving Defendants’ motion for summary adjudication.

1. Evidentiary Objections
Plaintiff objects to the declaration of Jennifer L. Keller: all objections are overruled.

Moving Defendants object to portions of the declarations of Bina Modi and Dinesh Shah: all objections are overruled. Moving Defendants also object to portions of the declaration of Sashikant Jogani: Objection Nos. 43, 47-48, and 53 are sustained; remainder overruled.

2. Request for Judicial Notice
In their reply, Moving Defendants requested judicial notice of the SAC; portions of and exhibits from Plaintiff’s testimony at trial, deposition, and judgment debtor examination; pleadings, judgments, and other documents filed in this action and other actions. Plaintiff objects to the RJN as being new matter submitted in the reply and on the ground that Moving Defendants attempt to improperly request judicial notice of the contents of pleadings, depositions, and declarations.

The Court notes that all of the evidence of which Moving Defendants requested judicial notice had previously been submitted in Moving Defendants’ compendium of evidence in support of the motion for summary adjudication. The Court grants judicial notice only as to the fact of the filing of the pleadings, judgments, and other documents in this action and other actions; otherwise, the RJN is denied.

3. Procedural Deficiency
Plaintiff’s opposition separate statement responded to every fact in Moving Defendants’ separate statement as disputed. However, Plaintiff only cited to portions of evidence submitted in opposition, referred to his objections, asserted language in Jogan v. Jogani (2006) 141 Cal.App.4th 158, 187 (“Jogani I”), and requested a continuance to take discovery concerning Steven Glass. This violates CRC 3.1350(f) in failing to indicate the nature of the dispute or describe the supporting evidence. The Court would normally exercise its discretion to continue the hearing to permit Plaintiff to file an amended and compliant opposition separate statement (See Parkview Villas Ass’n, Inc. v. State Farm Fire & Cas. Co. (2005) 133 Cal.App.4th 1197, 1212, 1214-15); however, after reviewing the procedural history of this action and the parties’ papers, the Court finds that this is not necessary.

4. Enforceable Partnership Agreement (“Illegality Argument”)
Moving Defendants argue that the alleged partnership is unenforceable because it was intended to defraud creditors, lenders, and tax authorities. The Court notes that the 1st through 3rd and 5th COAs all depend on an enforceable partnership agreement. Cf. Jogani IV, 2012 WL 6042366 at *15 (concluding that triable issues pertaining to the existence of a partnership agreement required the judgments in favor of Haresh and the summary adjudication of the 1st through 3rd COAs to be reversed).

“’The general principle is well established that a contract founded on an illegal consideration, or which is made for the purpose of furthering any matter or thing prohibited by statute, or to aid or assist any party therein, is void. This rule applies to every contract which is founded on a transaction malum in se, or which is prohibited by a statute on the ground of public policy.’” Homami v. Iranzadi (1989) 211 Cal.App.3d 1104, 1109 (citations omitted).

Moving Defendants submit that Plaintiff represented to financial institutions that he had no ownership interest in the Holding Companies (Defs.’ Sep. Statement [“SS”] ¶¶ 10, 23) and testified in various judgment debtor examinations in creditor actions against him that he had no partnership or ownership interests (id. ¶¶ 13-22). In contrast, Moving Defendants submit that Plaintiff has testified as to his control over and interest in the alleged partnership (id. ¶¶ 25-28, 33) and that he has transferred or contributed assets to the alleged partnership at significant discounts (id. ¶¶ 9, 35-44). Moving Defendants submit that several creditor judgments against Plaintiff were settled and purchased by the alleged partnership. Id. ¶ 12. Moving Defendants also submit that Plaintiff entered into a Consulting Agreement so that he could receive money to be deducted for tax purposes and to demonstrate his relationship to lenders (id. ¶ 8) and that the alleged partnership was to limit Plaintiff’ perceived connection to the Holding Companies (id. ¶¶ 34, 45-46).

a. Law of the Case
In opposition, Plaintiff argues that Moving Defendants illegality argument has been previously raised and impliedly rejected by the Court of Appeal. The law of the case doctrine applies where the Court of Appeal’s decision stating a necessary rule of law, and any implied determination essential to the decision, conclusively establishes that rule in any subsequent retrial or appeal. See Eldridge v. Burns (1982) 136 Cal.App.3d 907, 920-22.

To the extent Plaintiff argues that the enforceability argument has been rejected by the Court of Appeal’s decisions, this is incorrect. Plaintiff argues that when illegality of a contract is raised by the evidence, the court has the power and duty to ascertain the true facts on its own motion even on appeal. Fellom v. Adams (1969) 274 Cal.App.2d 855, 863. However, in Jogani I, the Court of Appeal expressly noted that the trial court did not rule on the illegality argument and the Court of Appeal did not discuss it because it was not raised on appeal (Jogani I, 141 Cal.App.4th at 168 n.1). A review of the Court of Appeal decisions in this action (see Friedman Decl. Exs. 11-14) indicate that none of the decisions were based on the illegality argument, and an implied determination on the illegality argument was not essential to any of the decisions. Therefore, the Court of Appeal’s decisions do not provide the law of the case on the illegality argument.

b. Merits
The Court of Appeal has concluded that Plaintiff’s “allegations and deposition testimony in this action are totally inconsistent with the statements he made in the judgment debtor examinations.” Jogani I, 141 Cal.App.4th at 188. Nevertheless, the Court of Appeal did not apply judicial estoppel to bar Plaintiff’s action and stated that the trier of fact is to assess the truth of such inconsistent testimony with respect to Plaintiff’s claims on the merits. Id. Additionally, the Court of Appeal has rejected Moving Defendants’ objections to Plaintiff’s inconsistent evidence. Jogani IV, 2012 WL 6042366 at *14-15.

In addition to Plaintiff’s testimony at the judgment debtor examinations, Moving Defendants’ motion is also based on Plaintiff’s previous deposition testimony offered in this action (see Keller Decl. Ex. 3) which Moving Defendants argue is inconsistent with Plaintiff’s opposition evidence to which Moving Defendants submit objections (see, e.g., Reply p. 7:16-8:16. It is important to note that the inconsistency previously addressed by the Court of Appeal concerns the existence of the alleged partnership agreement. Moving Defendants’ argument on this motion argues that the intent and purpose of the alleged partnership agreement and transactions related thereto has been admitted in Plaintiff’s previous deposition testimony to be illegal. The Court disagrees.

Plaintiff’s previous deposition testimony is equivocal as to whether there was an illegal intent or purpose. Plaintiff’s opposition evidence explains the intent and purpose of the alleged partnership agreement and transactions related thereto: this evidence does not contradict Plaintiff’s previous deposition testimony. See Scalf v. D.B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1524-25 (“While the D’Amico rule permits a trial court to disregard declarations by a party which contradict his or her own discovery responses (absent a reasonable explanation for the discrepancy), it does not countenance ignoring other credible evidence that contradicts or explains that party’s answers or otherwise demonstrates there are genuine issues of factual dispute.” (citing to D’Amico v. Board of Medical Examiners (1974) 11 Cal.3d 1, 21-22)). While Moving Defendants’ may assert this argument at trial, the assessment and determination of such intent and purpose is to be determined by the trier of fact (see Redke v. Silvertrust (1971) 6 Cal.3d 94, 103).

Therefore, the motion for summary adjudication is denied.

III. MOTION TO DISQUALIFY COUNSEL
Moving Defendants seek to disqualify Steven Glass from acting as Plaintiff’s counsel, to enjoin communications with Mr. Glass, and to preclude Mr. Glass from testifying in this action. Moving Defendants submit that Mr. Glass has previously represented them in numerous transactions including real estate transactions that are the subject of this action (see Mot’n p. 3:24-7:18) and that that Mr. Glass has continued to represent adverse parties with respect to this dispute after a conflict had arisen (id. at p. 7:19-9:25).

Mr. Glass does not dispute that he previously represented the Holding Companies, and Mr. Glass has agreed to refrain from acting as counsel or communicating with Plaintiff or Plaintiff’s counsel in connection with the litigation of this action provided there are no factual or legal findings against him. Parker Decl. ¶ 3. However, Mr. Glass and Plaintiff oppose Moving Defendants’ request to exclude his testimony.

Mr. Glass and Plaintiff argue that there is no authority to preclude Mr. Glass from testifying as a percipient witness. Plaintiff additionally argues that Moving Defendants’ deposition of Mr. Glass, and the filing of such testimony in the Court, as to the facts giving rise to this action results in any claim of privilege being waived (Motown Record Corp. v. Superior Court (1984) 155 Cal.App.3d 482, 492; Jones v. Superior Court (1981) 119 Cal.App.3d 534, 547) or subject to the crime-fraud exception (State Farm Fire & Casualty Co. v. Superior Court (1997) 54 Cal.App.4th 625, 643).

Moving Defendants rely on Brand v. 20th Century Ins. Co./21st Century Ins. Co. (2004) 124 Cal.App.4th 594, 606-7, to argue that Mr. Glass cannot testify in this action. However, Brand concerned an attorney who was retained to testify as an expert in an insurance coverage action concerning the attorney’s former client’s claims handling policies and procedures. Additionally, with respect to Mr. Glass’ testimony, the ethical prohibition against an attorney’s successive representation of clients adverse to the attorney’s former client (see, e.g., City Nat’l Bank v. Adams (2002) 96 Cal.App.4th 315, 323-29; Fiduciary Trust Int’l of Cal. v. Superior Court (2013) 218 Cal.App.4th 465, 482-86) is not implicated. Moving Defendants fail to cite to any authorities that extend the principles supporting disqualification from representation (either as successive attorney or as an expert) to preclude the testimony of an attorney (subject to considering applicable claims of privilege).

The Court accepts Mr. Glass’ offer to refrain from acting as counsel or communicating with Plaintiff or Plaintiff’s counsel in connection with the litigation of this action. Additionally, the Court finds no authority submitted by Moving Defendants that supports blanket preclusion of Mr. Glass’ testimony, without prejudice to claims of privilege being raised as proper. Therefore, the motion to disqualify counsel is denied.