State Street Palazzio Trattoria Italiana, Inc. v. Jesus Blanco, et al.
Case No: 16CV03166
Hearing Date: Tue Apr 03, 2018 9:30

Nature of Proceedings: Motion Leave to File Third Amended Complaint

Motion for Leave to File Third Amended Complaint

Attorneys:

For Plaintiff: David J. Tappeiner (Fell, Marking, et al.)

For Defendant: in pro per

Ruling: The Court grants plaintiff State Street Palazzio Trattoria Italiana, Inc.’s motion for leave to file a third amended complaint. On or before April 13, 2018, plaintiff shall file the third amended complaint with the Court (plaintiff may clean up the list of causes of action in the caption) and serve it on defendants Diversified Coatings and Linings Co., Inc., and Richard Hovey.

Background: This action arises out of damage to the subflooring and crawlspace area at premises that plaintiff State Street Palazzio Trattoria Italiana, Inc. (“Palazzio”) leased. Palazzio commenced this action on July 21, 2016. The operative complaint is the second amended complaint (“SAC”) against defendants Jesus Blanco; Blanco Heating and Air, Inc.; Diversified Coatings and Linings Co., Inc.; Ronald L. Wolfe & Associates, Inc.; and Victoria Kearny, Trustee of the Elaine Kearny Trust.

On September 20, 2017, the Court granted Jesus Blanco and Blanco Heating and Air, Inc.’s application for good faith settlement; they dismissed their cross-complaint; and the SAC has been dismissed as to these two defendants. On November 30, 2017, the Court granted Victoria Kearny, Trustee of the Elaine Kearny Trust; and Ronald L. Wolfe & Associates, Inc.’s application for good faith settlement; Kearny dismissed her cross-complaint; and the SAC has been dismissed as to these two defendants.

Diversified Coatings and Linings Co., Inc. (“Diversified”) is the sole remaining defendant and it’s cross-complaint also remains. Palazzio asserts only the first (breach of contract), second (negligence), and third (breach of implied warranties) causes of action in the SAC against Diversified. On March 6, 2018, the Court granted Diversified’s counsel’s motion to be relieved as counsel. A corporation cannot appear in pro per.

There is no trial date. A CMC is scheduled for June 5, 2018.

Motion: Palazzio moves to file a third amended complaint (TAC) against Diversified and its owner, Richard Hovey. The proposed TAC adds causes of action for fraud and unfair business practices and alter ego allegations against Hovey. (Plaintiff deletes the former fourth through tenth causes of action from the proposed TAC, but the caption still lists those causes of action and does not list the two new causes of action.) There is no opposition to the motion.

Palazzio has made the Court’s review of the motion more difficult by not including electronic bookmarks of exhibits as required in CRC 3.1110(f)(4).

The reason for the proposed TAC is that, in 2017, Diversified claimed that there was no insurance for the work it did on the premises. On November 7, 2017, Kenneth Boxer, president of Palazzio, found the September 8, 2006, proposal that Diversified and Hovey submitted, in which they represented that Diversified carried full liability insurance in the amount of $2,000,000.

A Court may, “in its discretion, after notice to the adverse party, allow, upon any terms as may be just, an amendment to any pleading….” CCP § 473(a). A court may allow an amendment to a pleading in the furtherance of justice at any time. CCP § 576. Courts exercise their discretion to allow amendments liberally. Nestle v. Santa Monica, 6 Cal.3d 920, 939 (1972). The liberal policy of permitting amendments should be applied only where no prejudice is shown to the adverse party. Magpali v. Farmers Group, 48 Cal.App.4th 471, 487 (1996).

CRC 3.1324(b) requires a supporting declaration specifying: “(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.”

The declarations are a little vague about the discovery of facts giving rise to the complaint. Boxer says that in 2017, Diversified claimed it had no insurance. He does not say when in 2017 or in what context. In the motion, Palazzio says Diversified disclosed this information at a mediation on July 26, 2017, but neither Boxer nor his counsel states this fact in a declaration. Boxer says he found the 2006 representation on November 7, 2017, but he does not state why he did not find that earlier.

Given that the information was discovered in the last year and there is no trial date, the motion does not appear to be untimely. Therefore, the Court grants plaintiff State Street Palazzio Trattoria Italiana, Inc.’s motion for leave to file a third amended complaint. On or before April 13, 2018, plaintiff shall file the third amended complaint with the Court (plaintiff may clean up the list of causes of action in the caption) and serve it on defendants Diversified Coatings and Linings Co., Inc., and Richard Hovey. (A new summons must be served on Hovey.)