Lakeview Village Corp. vs. Court

A claim for wrongful termination based upon FEHA cannot survive if the underlying FEHA claims upon which it depends cannot survive. (Featherstone v. S. California Permanente Med. Grp. (2017) 10 Cal.App.5th 1150, 1169 [“if an employer did not violate FEHA, the employee’s claim for wrongful termination in violation of public policy necessarily fails.”].)

Here, Defendants argue that the “sixteenth cause of action for wrongful termination in violation of public policy as to Defendant Swift Transportation fails as a matter of law, because Plaintiff cannot establish that he was terminated for statutory discrimination or retaliation.” For all the reasons discussed above, the Court finds that there are triable issues of material fact regarding the undisputed facts set forth in the separate statement for this cause of action. The Motion is DENIED as to the sixteenth cause of action for wrongful termination in violation of public policy.

J. Summary

In sum, the Court rules as follows:

• The Motion is GRANTED as to the second cause of action for failure to provide overtime compensation, third cause of action for failure to provide rest breaks, fifth cause of action for waiting time penalties, and sixth cause of action for failure to provide accurate itemized wage statements.

• The Motion is DENIED as to the first cause of action for failure to pay wages, seventh cause of action for disability/perceived disability discrimination, eighth cause of action for race discrimination, ninth cause of action for work environment harassment, tenth cause of action for retaliation pursuant to Government Code section 12940(h), eleventh cause of action for failure to prevent harassment, discrimination, and retaliation, twelfth cause of action for retaliation pursuant to Labor Code section 98.6 and 1102.5, thirteenth cause of action for failure to provide reasonable accommodation, fourteenth cause of action for failure to engage in good faith interactive process, fifteenth cause of action for violation of Business and Professions code section 17200, and sixteenth cause of action for wrongful termination in violation of public policy.

The Court did not address the fourth cause of action for failure to indemnify/reimburse.

Plaintiff to give notice.

9. 30-2024-01399839 1. Motion for Summary Judgment and/or Adjudication

Lakeview Village Corp. Cross Complainants and Cross-Defendants Pete John Coury (DOB 04/08/1936) (“Pete Coury”) vs. Court and Patricia Ovilia Coury (“Trish Coury”), individually and as Co-Trustees of the Pete J. Coury Revocable Trust dated August 21, 2002 (collectively, “Trustees” or “Moving Parties/MP”) move the Court for an Order Granting Summary Adjudication on: (1) the Twelfth Cause of Action for Declaratory Relief in the Trustees’ First Amended Cross-Complaint (“Trustees’ FACC”); and (2) the Fourteenth Cause of Action for Aiding and Abetting Breach of Fiduciary Duty in the First Amended Cross-Complaint (“PJ Coury Parties’ FACC”) of Cross-Complainant and Cross- Defendant Pete John Coury (DOB 02/14/2003) (“PJ Coury”), and Cross-Complainants Homes West, Inc. (“Homes West”) and La Alcancia, Inc. (“La Alcancia,” and together with Homes West and PJ Coury, the “PJ Coury Parties”).

ISSUE 1: Moving Parties are entitled to Summary Adjudication on the Twelfth Cause of Action for Declaratory Relief in the Trustees’ FACC, because as a matter of law on the undisputed facts, the October 11 and 31, 2011 transfers of stock in La Alcancia and Homes West, respectively, by Pete Coury, as Trustee of the Trust, to John Pete Coury, as Custodian for PJ Coury under UTMA, were not valid transfers under the California Uniform Transfer to Minors Act (“UTMA”), Probate Code section 3900 et seq., and therefore were not irrevocable, because all requirements of Probate Code sections 3906(c) and/or 3909(b) were not satisfied in connection with those transfers.

Notably, as to the 12th cause of action for Declaratory Relief in the Trustees’ FACC, MP must sustain the initial, substantive burden to establish each element of that cause of action. The elements of Declaratory Relief are: (1) a proper subject of declaratory relief, and (2) an actual controversy involving justiciable questions relating to [the party's] rights or obligations.

Here, MPs fail to mention the elements of the declaratory relief cause of action, let alone support their arguments with reference to law and evidence.

Furthermore, it appears the cause of action is improper as the alleged repudiation of the obligation has already occurred. That is, the cause of action as framed would not operate prospectively to declare future rights. Rather, MPs are attempting to use it to understand whether there were past wrongs.

As such, Motion for Summary Adjudication is denied as to Issue 1.

ISSUE 2: Moving Parties are entitled to Summary Adjudication on the Fourteenth Cause of Action for Aiding and Abetting Breach of Fiduciary Duty in the PJ Coury Parties’ FACC, because as a matter of law on the undisputed facts, the October 11 and 31, 2011 transfers of stock in La Alcancia and Homes West, respectively, by Pete Coury, as Trustee of the Trust, to John Pete Coury, as Custodian for PJ Coury under UTMA, were not valid transfers under the California Uniform Transfer to Minors Act (“UTMA”), Probate Code section 3900 et seq., because all requirements of Probate Code sections 3906(c) and/or 3909(b) were not satisfied in connection with those transfers, and therefore no fiduciary duty arose under Probate Code section 3912(b) for which Pete Coury and Trish Coury could be held liable on an aiding and abetting theory.

Because the 14th cause of action is set forth in PJ Coury Parties’ FACC, MP has the burden to “show” that either: • one or more elements of the “cause of action ... cannot be established”; OR • there is a complete defense to that cause of action. [CCP § 437c(p)(2) (emphasis added)]

Here, while MPs clearly argue that “no fiduciary duty arose”, it is unclear if they are suggesting this is because that element “cannot be established”, or because there is “a complete defense” to the cause of action.

MPs argue there was effectively no transfer to minor PJ under the Trust instruments and Probate Code.

Here, it is undisputed that Pete created a revocable trust. [UMF No. 1.]

In reading through the Trust, it appears that the purpose of it was to provide Pete Coury with an income while he was alive, and for the trust assets to be distributed upon his death. Section 2.0 of

the Trust allows the Trustor to “revoke or amend...or withdraw a portion or all of the Trust Estate at any time.”

Here, the Trust corpus consisted, in relevant part, of shares of common stock of Homes West Inc. and shares of common stock in La Alcancia Inc.

It appears undisputed that on October 11, 2011, Stock Power instruments were signed by Pete J. Coury, Trustee of the Pete J. Coury Revocable Trust dated August 21, 2002, purporting to “gift, assign, transfer” the subject shares to “John Pete Coury, as Custodian for Pete John Coury under the UTMA”. [See ROA 416, Ex. 7,8]

Notably, the actual Common Share certificate No, 6 as to La Alancia, Inc. was signed by Pete Coury as President. [Ex. 7.] This is the same as the Common Share certificate relating to Homes West Inc. [Ex. 8.]

As is clearly indicated from the Trust itself, the Trustor (Pete Coury) had the right to “withdraw a portion or all of the Trust at any time.” The only requirement was that a “notice of withdrawal must be in a written document other than a Will and will be effective when received by the Trustee.”

Here, because Pete J. Coury is still alive, he is both the Trust and Trustee of the Trust. Arguably, the signed “Stock Power” instruments suffice as notices of withdrawal of the subject shares in compliance with 2.0.

Therefore, the disposition of a portion of the trust property (the shares) by the trustee (who is also the trustor) and set forth in the Stock Power instruments appears to comply with the Trust itself.

MPs argue that the trust does not allow a gift to be made, and the Shares went from the Trustee to the Custodian instead of from the trust back to Pete Coury as an individual. However, only a revoked portion would revert to the Trustor as if the Trust had not been created. It is unclear if withdrawn corpus had to first go back to Pete Coury as an individual. And, while the Stock Power instruments were signed by Pete Coury as Trustee, the Common Share certificates were signed by Pete Coury apparently as director/officer of the corporations.

As such, the action taken by Pete Coury appears to comply with the Trust, but if not, whether the shares were revoked or withdrawn (and in what capacity by Pete Coury) should be determined by the trier of fact.

For the same reasons, it appears there are triable issues of material fact as to whether Ca Probate Code was complied with.

Here, the transfer did not comply with Ca Probate Code§3906(c)(3) because it is undisputed that the shares were worth more than $10,000 and no court authorization was obtained. [UMF 15-19]

However, PJ argues that Probate Code § 3905(a) and Probate Code § 15401(a) apply and not Probate Code § 3906.

Prob. Code, § 3905 provides, “(a) A personal representative or trustee may make an irrevocable transfer pursuant to Section 3909 to a custodian for the benefit of a minor as authorized in the governing will or trust.” This section does not appear to require Court approval for assets over $10,000.

Notably, nothing in the trust establishes that a transfer may be made to a minor under §3909 while Pete is still living. Arguably, however, this section could be construed to mean, the trust allowed Pete to revoke, amend, withdraw the property, which was then transferred to John for the benefit of PJ.

As to 3909, it appears compliance was made. The Declaration of Pete John Coury (d.o.b. 4-8- 1936), paragraph 6, page 3:6-13 and Exhibits 7 and 8 show that the 300 shares of each corporation were a “certificated security in registered form,” within the meaning of Probate Code § 3909(a)(1)(A), registered on the books and records of each corporation.

Furthermore, even if there was no strict compliance with the Probate Code, equitable principles seemingly apply to warrant a denial of motion for summary adjudication as to Issue 2.

Indeed, PJ argues equitable estoppel prevents a party from taking inconsistent positions. PJ cites to Evidence Code§623 which provides:

Whenever a party has, by his own statement or conduct, intentionally and deliberately led another to believe a particular thing true and to act upon such belief, he is not, in any litigation arising out of such statement or conduct, permitted to contradict it.

[Evid. Code, § 623]

Here, the Declaration of Attorney Henry B, LaTorraca states: 5. Attached hereto as Exhibit “10” is a true and correct copy of a page from IRS form 709, the United States Gift (and Generation-Skipping Transfer) Tax Return, produced by Pete John Coury (d.o.b. 4-8-36) with the Bates Stamp LVC.COURY1505, showing the gifts made by him to John Pete Coury as Custodian for Pete John Coury (d.o.b. 2-14-03) under the UTMA. No other pages of that form were produced.

Case law also reveals the four elements which must be present in order to apply the doctrine of equitable estoppel: the party to be estopped must be apprised of the facts; he must intend that his conduct shall be acted upon, or must so act that the party asserting the estoppel had a right to believe it was so intended; the other party must be ignorant of the true state of facts; and he must rely upon the conduct to his injury. [City of Long Beach v. Mansell (1970) 3 Cal.3d 462, 466.]

Here, PJ argues that Pete obviously knew that he was submitting a gift tax return signed by him under penalty of perjury with appraised values for the UTMA transfers; that he must intend that his gift tax return be acted upon by the IRS or that he knew that the IRS had the right to believe that he was honestly representing those facts; that he intended that the IRS believe in the truth of his gift tax return signed by him under penalty of perjury with appraised values for the UTMA transfers; that the IRS had a right to believe that he was truthfully and honestly submitting that gift tax return under penalty of perjury; that the IRS had no reason to believe that he was being untruthful; and that the IRS relied on that gift tax return upon filing.

Additionally, while not argued by PJ, it is clear that an action for breach of fiduciary duty is an action in equity. [Northbay Wellness Group, Inc. v. Beyries (9th Cir. 2015) 789 F.3d 956.]

In terms of equity and the arguments made by the MP herein, the maxim of “no man may take advantage of his own wrong” comes to mind.

“Deeply rooted in our jurisprudence this principle has been applied in many diverse classes of cases by both law and equity courts, (Glus v. Brooklyn Eastern Dist. Terminal (1959) 359 U.S. 231, 232–233) and should act as a bar to MPs position herein.

Accordingly, motion is DENIED as to Issue 2.

RJN of pleadings is GRANTED.

PJ to give notice.