Cemex Construction Materials Pacific, LLC vs. Gunner Concrete, Inc.

Plaintiffs contend that the work toward their case against Fletcher Jones could be used in their case against Defendant Mercedes-Benz USA. Plaintiffs note that Defendant Mercedes-Benz USA knows that Fletcher Jones is an authorized Mercedes-Benz warranty repair facility that performed warranty repairs on the Plaintiff’s vehicle on dates including February 14, 2023; March 13, 2023; and July 12, 2024.

Furthermore, the settlement agreement between the parties did not provide that Mercedes-Benz would only pay apportioned fees. Rather, the settlement agreement provides:

“MBUSA will pay Releasor’s statutory costs and expenses under Civil Code § 1794(d), in the amount determined by the Court to have been reasonably incurred by Releasor in connection with the commencement and prosecution of this action. In ruling on Releasor’s fee/cost motion(s), and except as otherwise provided for in this paragraph, the fees, expenses, and costs amount shall be calculated as if Releasor were found to have prevailed in this action under section 1794(d) of the California Code of Civil Procedure.” (Decl. of Urner, Exhibit A).

Accordingly, the court rejects Defendant’s argument.

Costs

Plaintiffs seek to recover $828.05 in costs.

Defendant does not challenge any specific item of costs. Accordingly, the court awards the full amount.

Plaintiffs shall give notice.

13 Cemex TENTATIVE RULING: Construction Materials Motion for Summary Judgment Pacific, LLC vs. Gunner Concrete, Inc. Plaintiff Cemex Construction Materials Pacific, LLC moves for summary judgment on its Complaint as to Defendants Douglas Scott Milne, II and Geneva Milne (“Defendants”). For the following reasons, the motion is GRANTED. Plaintiff’s evidentiary objections are OVERRULED. Plaintiff’s request for judicial notice is GRANTED.

Statement of Law

A plaintiff moving for summary judgment “bears the burden of persuasion that ‘each element of’ the ‘cause of action’ in question has been ‘proved,’ and hence that ‘there is no defense’ thereto. [Citation.]” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850; Code Civ. Proc. § 437c, subd. (p)(1).) “Once the plaintiff ... has met that burden, the burden shifts to the defendant ... to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto. The defendant ... may not rely upon the mere allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to that cause of action or a defense thereto.” (Code Civ. Proc. § 437c, subd. (p)(1).)

In determining whether the parties have met their respective burdens, “the court must ‘consider all of the evidence’ and ‘all’ of the ‘inferences’ reasonably drawn therefrom [citation], and must view such evidence [citations] and such inferences [citations], in the light most favorable to the opposing party.” (Aguilar, supra, 25 Cal.4th at p. 843.) “There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Id. at p. 850, fn. omitted.)

Thus, a party “ ‘cannot avoid summary judgment by asserting facts based on mere speculation and conjecture, but instead must produce admissible evidence raising a triable issue of fact. [Citation.]’ [Citation.]” (Dollinger DeAnza Associates v. Chicago Title Ins. Co. (2011) 199 Cal.App.4th 1132, 1144-1145.)

The moving party’s papers are to be strictly construed, while the opposing party’s papers are to be liberally construed. (Committee to Save Beverly Highland Homes Ass’n v. Beverly Highland (2001) 92 Cal.App 4th 1247, 1260.) A court may not make credibility determinations or weigh the evidence on a motion for summary judgment or adjudication, and all evidentiary conflicts are to be resolved against the moving party. (McCabe v. American Honda Motor Corp. (2002) 100 Cal.App.4th 1111, 1119.)

Merits

As to the individual Defendants, the Complaint asserts only one cause of action – the second cause of action for breach of personal guaranty.

The elements of a cause of action for breach of a guaranty are similar to a breach of contract claim: (1) a guaranty contract; (2) default by the borrower; (3) notice to the guarantor of the default; (4) nonpayment of the debt by the guarantor; and (5) resulting damages. (Gray1 CPB, LLC v. Kolokotronis (2011) 202 Cal.App.4th 480, 486; Torrey Pines Bank v. Superior Court (1989) 216 Cal.App.3d 813, 819.)

On November 10, 2021, Plaintiff Cemex and Defendant Gunner Concrete, Inc. (“Gunner”) entered into a written Credit Application and Agreement (“Agreement”). (Hansen Dec., ¶ 3.) In that Agreement, Defendants executed a personal guaranty:

In signing this agreement I (we) acknowledge that I (we) have read and fully understand the Standard Terms and Conditions set change conditions set forth in the second page of this agreement and agree to be bound by all of the terms and conditions set forth therein. I (we) hereby represent and warrant that I (we) am authorized to enter into this Agreement on behalf of the business. I (we) also agree to pay all purchases within the term set. If the above business is other than an individual, the undersigned agrees to be personally responsible and pay for any purchases made by such business pursuant to this Agreement.

The undersigned hereby gives a personal guarantee and acts as a payment bond surety for the applicant. If it becomes necessary to effect collections, both I (we) and the business will pay reasonable attorney fees, agency fees, and court costs. A designation of payment is required on jobs where real property has been improved. If no designation is made, payment will be applied to the oldest unpaid balance. This Agreement will remain in effect until a new agreement is received and approved by an authorized manager or until revoked in writing by certified mail or overnight delivery regardless of any subsequent change in the legal status of the account.

(Plaintiff’s Material Fact (“PMF”) 1-6; Hansen Dec., ¶ 3 and Ex. A [emphasis in original].) Defendants signed immediately below this personal guaranty language. (Ibid.)

Plaintiff has met its initial burden of establishing a guaranty contract. Plaintiff has also met its initial burden of establishing that Gunner defaulted on the Agreement, that Defendants had notice of Gunner’s default and they have not paid the debt, and Plaintiff has suffered damages in the outstanding principal amount of $728,642.94.

Plaintiff supplied materials to Gunner under the Agreement and Gunner failed to pay for those materials. (PMF 8.) The Court entered a default judgment against Gunner in this matter. (PMF 9-10.) Defendants have not paid the unpaid balance on Gunner’s account with Plaintiff. (PMF 11.)

Defendants contend that the Agreement contains conflicting provisions regarding when personal liability applies. The Agreement states “If the above business is other than an individual, the undersigned agrees to be personally responsible and pay for any purchases made by such business pursuant to this Agreement. The undersigned hereby gives a personal guarantee and acts as a payment bond surety for the applicant.” (PMF 2.) However, Defendants also point to Paragraph 2 of the Agreement, which states:

“If Applicant is not a corporation or limited liability entity, Applicant acknowledges that CEMEX is relying on the credit worthiness and financial ability of the owner(s) of Applicant. Each owner shall be jointly and severally liable for all indebtedness of Applicant to CEMEX under this Agreement.”

(Defendant’s Material Fact (“DMF”) No. 23; Hansen Dec., ¶ 3 and Ex. A.)

Gunner is a corporation, so Defendants seem to argue guaranty liability under the Agreement is limited to non-corporate applications and thus does not apply to this case. The personal guaranty applies when the application is “other than an individual.” Paragraph 2 imposes liability for non-entity applicants. Despite Defendants’ contention to the contrary, there is no irreconcilable conflict in these two provisions. Defendant Gunner is a corporation, so Paragraph 2 does not apply in this instance.

Defendants also contend that Plaintiff did not identify the Agreement as a personal guaranty and that they “understood” the document to be a credit application. However, the document speaks for itself. The document is titled “Credit Application and Agreement – Standard Terms and Conditions.” That Defendants did not understand the Agreement to be an agreement is irrelevant. Defendants have not shown that the Agreement is internally inconsistent or ambiguous. Defendants signed directly below a statement that they agree “to be bound by all of the terms and conditions” and agree “to be personally responsible and pay for any purchases made by such business pursuant to this Agreement. The undersigned hereby gives a personal guarantee and acts as a payment bond surety for the applicant.” (PMF 2 [emphasis in original].)

California law requires courts to interpret contracts based on the mutual intention of the parties as it existed at the time of contracting (Civ. Code § 1636.) This intention is to be ascertained from the writing alone if possible, with the language of the contract governing its interpretation if the language is clear and explicit (Civ. Code § 1639; 1638.) The fundamental principle is that “the whole of a contract is to be taken together, so as to give effect to every part, if reasonably practicable, each clause helping to interpret the other.” (Civ.

Code §1641.) Mutual consent necessary to establish a contract is determined not by a party’s unexpressed understanding or intention but by an objective standard applied to their outward manifestations or expressions (Bustamante v. Intuit, Inc. (2006) 141 Cal.App.4th 199, 208; see also R.W.L. Enterprises v. Oldcastle, Inc. (2017) 17 Cal.App.5th 1019, 1031 [treating a “credit application” as an enforceable contract].)

Finally, Defendants point to their motion for leave to file a Cross- Complaint as a reason not to enter a final judgment. Defendants’ motion for leave to file a Cross-Complaint is not a defense to the cause of action for breach of guaranty and is thus not a basis to deny summary judgment. (See, e.g., Code Civ. Proc. § 437c(k).)

Plaintiff is ordered to give notice of this ruling.

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