Justia Civil Procedure Opinion Summaries

PGA West Residential Association, Inc. (PGA West) alleged defendant Dempsey Mork tried to fraudulently insulate the equity in his condominium from creditors by naming Hulven International, Inc. (Hulven), a sham corporation entirely owned and controlled by Mork, as the beneficiary of a deed of trust and note, and by later directing Hulven to foreclose on the condominium. Hulven demurred to the complaint, arguing PGA West's lawsuit was barred by a seven-year limitations period for actions under the former Uniform Fraudulent Transfer Act. The superior court overruled the demurrer and, after conducting a bench trial, entered judgment for PGA West. In this appeal, Hulven argued the superior court erred by overruling its demurrer. According to Hulven, the allegedly fraudulent activities by Mork and Hulven were a “transfer” for purposes of the UFTA and, therefore, this lawsuit was governed by that act and its seven-year limitations period. Because PGA West filed its lawsuit more than seven years after the alleged fraudulent transfer, Hulven contends PGA West's claims were completely extinguished. The Court of Appeal agreed with Hulven that Mork's alleged fraudulent attempt to insulate the equity in his condominium from creditors by naming a sham corporation as the beneficiary on the deed of trust constituted a “transfer” for purposes of the UFTA and that the act's limitations period applied here: "the seven-year limitations period for actions under the UFTA is not simply a procedural statute of limitations that bars a remedy and is forfeited if not properly raised by a defendant. Rather, the UFTA's seven-year limitations period is a substantive statute of repose that completely extinguishes a right or obligation and, under the majority view that we adopt, a statute of repose is not subject to forfeiture." Because PGA West filed its lawsuit after the UFTA's statute of repose had run, its rights under the act were completely extinguished. Therefore, the Court concluded the superior court erred as a matter of law by overruling Hulven's demurrer. View "PGA West Residential Assn. v. Hulven International" on Justia Law

This case arose from a community college’s decision to buy a plot of vacant land from a regional park district for potential future use as the site of a new campus. Plaintiffs-appellants Martha Bridges and John Burkett, residents of Wildomar (where the land was located) sued respondent Mt. San Jacinto Community College District (the community college, or the college) alleging it violated California Environmental Quality Act (CEQA) by failing to prepare an environmental impact report (EIR) before executing a purchase agreement for the property. Appellants also alleged the community college violated CEQA by failing to adopt local CEQA implementing guidelines. The trial court dismissed the action in its entirety, and the Court of Appeal affirmed: (1) appellants did not exhaust their administrative remedies before filing this suit and did not demonstrate they were excused from doing so; and (2) even if the exhaustion doctrine did not bar appellants’ suit, the Court would have affirmed the trial court’s ruling because both of their CEQA claims lacked merit. View "Bridges v. Mt. San Jacinto Community College Dist." on Justia Law

Plaintiff Melony Light appealed judgments in favor of her employer, defendant California Department of Parks and Recreation (Department), and her former supervisors, defendants Leda Seals and Kathy Dolinar, following orders granting defendants' motions for summary judgment. Light worked for the Department's Ocotillo Wells District. She alleged numerous claims against the Department, Seals, and Dolinar, including retaliation, harassment, disability discrimination, assault, false imprisonment, negligent infliction of emotional distress, and intentional infliction of emotional distress. The trial court disposed of several claims at the pleading stage. After two and a half years of litigation, the Department, Seals, and Dolinar moved for summary judgment on the remaining claims against them. As to the Department, the Court of Appeal concluded triable issues of material fact precluded summary adjudication of Light's retaliation claim, but not her disability discrimination claim. Light's claim against the Department for failure to prevent retaliation or discrimination therefore survived based on the retaliation claim. As to Seals and Dolinar, the Court concluded contrary to the trial court that workers' compensation exclusivity did not bar Light's claim for intentional infliction of emotional distress under the circumstances here. However, as to the merits of that claim, the Court concluded Light has raised a triable issue of fact only as to Seals, not Dolinar. Furthermore, the Court concluded Light raised triable issues of fact on her assault claim against Seals. Therefore, the Court affirmed in part and reversed in part the judgments in favor of the Department and Seals, and affirmed in full the judgment in favor of Dolinar. View "Light v. Calif. Dept. of Parks & Rec." on Justia Law

Prior to its dissolution, Culver City’s former redevelopment agency made an unauthorized transfer to the City of about $12.5 million. The Department of Finance (DOF) discovered the unauthorized transfer after the former redevelopment agency was dissolved and the City took over as the successor agency. Based on that discovery, DOF authorized the county auditor-controller to reduce by about $12.5 million the tax increment revenue made available to the successor agency to pay the successor agency’s enforceable obligations. In a prior action, the Sacramento Superior Court held that the former redevelopment agency should have retained the $12.5 million to pay its bills rather than transferring it to the City. DOF did not seek an order requiring the City to repay the $12.5 million. And neither party appealed the superior court’s judgment. Since judgment was entered in “Culver City I”, the City has not repaid the $12.5 million to the successor agency, and DOF has continued to authorize successive reductions to the allotment of tax increment revenue to the successor agency to pay its enforceable obligations. DOF asserts that those funds held by the City are available to the successor agency for payment of its enforceable obligations, but the City maintains that it has no duty to pay the money back. In this action, the City, both in its municipal capacity and as the successor agency of the former redevelopment agency, sought mandamus relief to stop DOF’s successive reductions of tax increment revenue to pay the successor agency’s enforceable obligations. DOF sought an order reversing the former redevelopment agency’s transfer of $12.5 million to the City and requiring the City to return the money. The superior court in this action held that DOF’s successive reductions were not authorized by the Dissolution Law. Based on this holding, the superior court granted the City’s petition for writ of mandate. While recognizing Culver City I’s holding that the former redevelopment agency’ss transfer to the City was unauthorized, the superior court denied DOF’s petition for an equitable writ of mandate requiring the return of the money because there was a statutory remedy for this situation. The State Controller conducted a review and ordered the City to return the $12.5 million to the successor agency. DOF appealed, asserting that the superior court erred by: (1) denying DOF’s petition for writ of mandate directing the City to return the money and (2) finding that successive reductions to the tax increment revenue provided to the successor agency for the same $12.5 million held by the City was not authorized by the Dissolution Law. The Court of Appeal affirmed. View "City of Culver City v. Cohen" on Justia Law

In an earlier action in which Florencia Garcia petitioned to dissolve her marriage to Juan Garcia (Dissolution Action), the family court found that Florencia did not meet her burden of establishing a valid marriage and quashed service as to Juan and dismissed the action. Florencia then filed the underlying action in which she petitioned for nullity of marriage (Nullity Action). In the Nullity Action, Juan appealed two family court orders: (1) one in which the court found that Florencia was Juan’s spouse or putative spouse, and she could proceed with the claims in her petition (Putative Spouse Order); and (2) one in which the court directed Juan to pay Florencia spousal support arrears, ongoing spousal support and attorney fees and costs (Support Order). In challenging the two orders, Juan raised a single legal issue for review on appeal: under res judicata, did the judgment in the Dissolution Action bar the relief Florencia sought in the Nullity Action? The Court of Appeal concluded the Dissolution Action and the Nullity Action involved different primary rights, and thus affirmed the Support Order. Because the Putative Spouse Order was not final, the Court dismissed Juan’s appeal. View "In re Marriage of Garcia" on Justia Law

In 1999, Ayala, unable to qualify for a mortgage to buy a five-unit Vacaville residential property, sought assistance from Dawson, a real estate broker. According to Ayala, they orally agreed that Dawson would obtain the loan and buy the property in Dawson’s name for $330,000; Ayala would pay the 20% downpayment and pay Dawson a $200 per month fee, plus the monthly principal and interest on the mortgage. The parties executed a written contract provided by Dawson, which Ayala claims he understood to confirm an installment contract on terms the two had previously discussed. Ayala moved into one of the units and claims he spent hundreds of thousands of dollars improving the property. From 2000-2008, he paid Dawson $2,700 per month; from 2008-2012, he paid $2,900 per month. Ayala actually had signed a standard form lease/option; the option expired in 2004. In 2011 Dawson offered to sell Ayala the property for $330,000, with a credit for the down payment. In Dawson’s unlawful detainer action, Ayala defended by claiming he held equitable title. Dawson prevailed. In Ayala's separate action against Dawson for fraud, the court granted Dawson summary judgment. The court of appeal affirmed, stating that, under the doctrine of collateral estoppel, Ayala is barred from relitigating his fraud-in-the-inducement theory. View "Ayala v. Dawson" on Justia Law

K.W.’s one-year conservatorship (Welf. & Inst. Code 5000) was established in 2015 following a contested bench trial. The Conservator petitioned for reappointment in 2016. K.W. requested a jury trial. Bravo, certified by the American Board of Psychiatry and Neurology, testified as an expert in forensic psychiatry. He was a consulting member of K.W.’s treatment team and conducted a 50-minute face-to-face interview with K.W. Bravo had previously interviewed K.W. and personally observed K.W. at the county’s psychiatric emergency facilities. Bravo consulted medical records and spoke to K.W.’s former psychiatrist, a social worker, and others. Bravo diagnosed K.W. as suffering from a schizoaffective disorder with “disorganized thinking and behaviors” resulting in lack of impulse control, impaired judgment, and “paranoid and grandiose” delusions. Bravo opined that K.W. lacked insight into his mental illness and that K.W met the Act's criteria for grave disability and was unable to care for himself. The jury found K.W. gravely disabled; the court ordered reestablishment of the conservatorship. The court of appeal affirmed. Any error by the trial court in permitting the jury to consider case-specific hearsay testimony of K.W.’s behavior was harmless. The only medical evidence before the jury was an unimpeached opinion from a well-qualified expert. The jury could reasonably have rejected K.W.’s contrary view of his own abilities. View "Conservatorship of the Person of K.W." on Justia Law

Marlene Baker LaBerge, a 73-year-old woman, was a resident and patient of a 24- hour skilled nursing facility owned by Italian Maple Holdings, LLC dba La Paloma Healthcare Center (La Paloma). LaBerge's heirs, Paul LaBerge, Suzanne Marx, and Talmadge Baker (collectively Plaintiffs) sued La Paloma and Plum Healthcare, LLC (together Defendants) for elder abuse, violations of the Patient's Bill of Rights as codified at Health and Safety Code section 1430, negligence, and wrongful death. In response, Defendants filed a petition to compel arbitration based on the two arbitration agreements that LaBerge had executed. The two arbitration agreements included language required by Code of Civil Procedure section 1295, subdivision (c), requiring such agreements to include a 30-day "cooling off" period, during which the parties to the agreement may rescind it. Ten days after LaBerge signed the agreements (and therefore, prior to the expiration of the statutorily-required 30- day rescission period), LaBerge passed away. The superior court denied the petition to compel arbitration, relying on Rodriguez v. Superior Court, 176 Cal.App.4th 1461 (2009) to conclude that the agreements were not effective until the 30-day rescission period passed without either party rescinding the agreements; because LaBerge died before the expiration of the 30-day rescission period, the agreements could not be given effect. On appeal, Defendants contended the trial court’s interpretation was wrong, and the Court of Appeal should decline to follow Rodriguez because that case was factually distinguishable from this case. The Court of Appeal concluded the trial court erred in interpreting section 1295, subdivision (c), and that the arbitration agreements were valid and enforceable. Pursuant to the plain language of section 1295, subdivision (c), the terms of those agreements governed the parties' relationship upon their execution; the fact that one signatory died before the expiration of the statutory 30-day rescission period does not render the terms of the parties' agreements unenforceable in the absence of other grounds for not enforcing them. View "Baker v. Italian Maple Holdings" on Justia Law

Spanish Peaks is a 3000-acre luxury resort in Big Sky Country, Montana. Development began in 2002; featured residences were to be “high-end settlement cabins,” close to a massive lodge, containing restaurants, stores, recreation facilities, and other amenities. Beginning in 2004 the five plaintiffs acquired eight undeveloped lots in Spanish Peaks and five with cabins--one cost over $3,000,000. By July 2011 all but two of the 13 properties had been lost, usually by foreclosure. The developer was bankrupt. Plaintiffs alleged fraud and negligence in construction and in soil remediation, asserting that Spanish Peaks was a “landslide complex.” Plaintiffs made numerous procedural mistakes: though four of the five plaintiffs had taken title via LLCs, the lawsuit was brought in their individual names; their statement of facts did not comply with the Rules of Court, despite two opportunities to comply. The court granted the defendants summary judgment based on plaintiffs’ noncompliance. The court of appeal affirmed; the trial court did not abuse its discretion. “The trial court specified deficiencies in appellants’ initial filing, identified the precise manner in which those deficiencies could be rectified, and afforded appellants ample opportunity to prepare new papers in compliance with applicable rules. Precisely this and no more was required.” View "Rush v. White Corp." on Justia Law

Defendants Beachcomber Management Crystal Cove, LLC (Management) and Douglas Cavanaugh (collectively, Defendants) challenged a trial court’s order disqualifying the law firm of Kohut & Kohut LLP (Kohut) from continuing to represent Defendants in the underlying matter. In March 2016, Plaintiffs filed this lawsuit on behalf of Beachcomber at Crystal Cove, LLC as a shareholder derivative action against Defendants. The complaint named the Company as a nominal defendant and alleged claims for fraud, breach of fiduciary duty, abuse of control, gross negligence and mismanagement, breach of duty of honest services, unjust enrichment, declaratory relief, and accounting. Plaintiffs alleged Defendants abused their position as the Company’s managers by diverting Company funds to other Cavanaugh entities, paying themselves unauthorized management fees, misallocating expenses the Company shares with other entities, and refusing to provide Plaintiffs complete access to the Company’s books and records. Defendants hired Kohut to represent them in this lawsuit, and the Company hired independent counsel, the law firm of Corbin, Steelman & Specter, to represent it in this lawsuit. In May 2016, Plaintiffs filed a motion to disqualify Kohut “from any further participation in this case” based on conflicts of interests arising from its past and present representation of the Company and Defendants. Specifically, Plaintiffs argued disqualification was required based on the conflicts of interest arising from: (1) Kohut’s concurrent representation of the Company and Defendants; (2) Kohut’s successive representation of the Company and Defendants concerning the disputes over the Company’s operations; and (3) the need for Kohut to testify in this lawsuit about the services it provided to the Company and Defendants. Here, the trial court concluded disqualification was mandatory because: (1) Defendants and the Company had conflicting interests because the Company is the true plaintiff in this derivative suit that Plaintiffs brought against Defendants on the Company’s behalf; and (2) Kohut previously represented the Company concerning some of the issues raised in this suit, and a substantial relationship therefore existed between that representation and Kohut’s representation of Defendants in this lawsuit. The Court of Appeal concluded the trial court erred because it failed to apply a more specific line of cases that governed an attorney’s successive representation of clients in a derivative lawsuit brought on a small or closely held company’s behalf against the insiders who run the company. View "Beachcomber Management Crystal Cove v. Super. Ct." on Justia Law