Demurrer to Complaint
102 Afakori v. Balfour DEMURRER TO COMPLAINT – OVERRULED Beatty Construction Plaintiff Afakori Inc. dba AAF Steel Structural LLC 2025-01511251 (“Plaintiff”) sued Defendant Balfour Beatty Construction, LLC (“Defendant”) for breach of a construction subcontract. (ROA #2) Defendant demurs to the complaint on the grounds that (1) Plaintiff lacks standing to assert the causes of action alleged and (2) judicial estoppel bars the causes of action.
In 2024, Plaintiff filed Chapter 11 bankruptcy. Defendant contends the claims asserted in this case were never identified as assets in the BK matter and were never abandoned by the BK trustee, meaning the BK trustee is the proper plaintiff in this case.
“ ‘As a general matter, upon the filing of a petition for bankruptcy, “all legal or equitable interests of the debtor in property” become the property of the bankruptcy estate and will be distributed to the debtor’s creditors. [Citation].’ ” (M & M Foods, Inc. v. Pacific American Fish Co., Inc. (2011) 196 Cal.App.4th 554, 561.) “ ‘In the context of bankruptcy proceedings, it is well understood that “a trustee, as the representative of the bankruptcy estate, is the real party in interest, and is the only party with standing to prosecute causes of action belonging to the estate once the bankruptcy petition has been filed.” [Citation].’ ” (Id. at p. 562.)
“ ‘An outstanding legal claim that is abandoned by the trustee reverts back to the original debtor-plaintiff.’ ” (Id. at p. 563.) “But property not formally scheduled in the bankruptcy proceeding is not abandoned at the close of the bankruptcy proceeding, even if the trustee was aware of the existence of the property.” (Ibid.) “Although there are ‘no bright-line rules for how much itemization and specificity is required,’ [the debtor] was required to be as particular as is reasonable under the circumstances.” (Id. at p. 564.)
In M & M Foods, M & M’s asset disclosure referenced M & M’s personal property as including “interest in collections obtained on outstanding accounts receivable from former business activities.” The court held that M & M had no standing to assert its causes of action for
$700,000 accounts receivable because its “asset disclosure schedule did not mention Pacific American, M & M, or the asset purchase agreement, much less the accounts receivable Pacific American was obligated to collect on behalf of M & M under that agreement.” (Ibid.)
The present case is factually distinguishable. The summary of assets and liabilities identifies an account receivable over 90 days old in the face amount of $715,625. (ROA #19, ex. 2) This is sufficient. Although Defendant argues “The schedules did not identify Balfour Beatty, the Project, the Subcontract, the alleged escalation amounts, any disputed contract balance, or any contingent, unliquidated, or disputed right to payment tied to the Project. Nor did the schedules list any pending or potential litigation, breach of contract claim, or account receivable traceable to Balfour Beatty.” (ROA #21 p. 5) The preprinted US government form, however, does not require such detail (nor does it provide space for such detail or invite attachments where such detail might be included. (See Cusano v. Klein (9th Cir. 2001) 264 F.3d 936.)
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The court finds Defendant has not established Plaintiff’s lack of standing.
Defendant argues that Plaintiff is judicially estopped from pursuing its claims against Defendant because its failure to disclose any dispute with Defendant is directly inconsistent with its position in this litigation.
Plaintiff argues that judicial estoppel does not apply because there was no plan or discharge in the bankruptcy action and there is no evidence that Plaintiff acted in bad faith.
“Judicial estoppel . . . ‘applies to preclude a party from assuming a position in a legal proceeding inconsistent with one previously asserted[.]’ ” (Hamilton v. Greenwich Investors XXVI, LLC (2011) 195 Cal.App.4th 1602, 1609.) Defendant argues that Plaintiff took directly inconsistent positions in its bankruptcy case and in this litigation by not disclosing any dispute with Defendant, contingent or unliquidated claims arising
from the subcontract, any accounts receivable tied to the project, or any potential litigation rights whatsoever. As with above, this argument fails because the Court finds that Plaintiff provided sufficient specificity regarding the accounts receivable related to Defendant.
Defendant to file an answer to the complaint within 20 days.
Defendant to give notice. 103
104 Esteban v. Urth Payroll DEFENDANT URTH PAYROLL SERVICES’ MOTION Services, 2025- TO COMPEL ARBITRATION – GRANTED 01511289 DEFENDANT VASQUEZ’S MOTION TO JOIN MOTION TO COMPEL ARBITRATION – GRANTED
Plaintiff Alejandro Esteban was employed by Defendant Urth as a barista, busboy, and food server. Defendant Vasquez is employed in the human resources department by Urth. Plaintiff alleges discrimination claims under FEHA, as well as wage and hour violations. On January 13, 2023, Esteban signed an arbitration agreement (which was provided to him in English and Spanish). Defendants contend this court should compel arbitration of Esteban’s claims based on the arbitration agreement.
On a motion to compel arbitration, the court’s role is limited to deciding: “(1) whether there is an agreement to arbitrate between the parties; and (2) whether the agreement covers the dispute.” (Brennan v. Opus Bank (9th Cir. 2015) 796 F.3d 1125, 1130.) If these conditions are satisfied, the court is without discretion to deny the motion and must compel arbitration. (9 U.S.C. § 4; Dean Witter Reynolds, Inc. v. Byrd (1985) 470 U.S. 213, 218 [“By its terms, the [FAA] leaves no place for the exercise of discretion by a district court, but instead mandates that district courts shall direct the parties to proceed to
arbitration.”].) “[T]he party resisting arbitration bears the burden of proving that the claims at issue are unsuitable for arbitration.” (Green Tree Fin. Corp. v. Randolph (2000) 531 U.S. 79, 91.)
Defendants have met their prima facie burden of establishing the existence of an arbitration agreement. (Vera Decl., ¶¶ 13-16, Ex. 1)
“If the moving party meets its initial prima facie burden and the opposing party disputes the agreement, then in the second step, the opposing party bears the burden of producing evidence to challenge the authenticity of the agreement. [Citation.]” (Gamboa v. Northeast Community Clinic (2021) 72 Cal.App.5th 158, 165.) “To bear this burden, the arbitration opponent must offer admissible evidence creating a factual dispute as the authenticity of their signatures.” (Iyere v. Wise Auto Group (2023) 87 Cal.App.5th 747,755.)
In opposition to this Motion, Plaintiff submits his Declaration wherein he states (as relevant to this motion): “3. My first language is Spanish. I am not fluent in English. I reviewed the purported MUTUAL AGREEMENT TO MEDIATE/ ARBITRATE (Hereinafter “Disputed Arbitration”) a true and correct copy is attached as Exhibit 1. [¶] 4. I was not offered arbitration. [¶] 5. I did not agree to arbitration.[¶] 12. After 2022 and 2023, the electronic documents were presented during busy working hours and repeatedly we were told that If we do not sign documents electronically on the spot, we would be terminated. [¶] 13. I do not agree to waive court rights. I do not agree to the arbitration.” (Esteban Decl.)
Here, Mr. Estaban’s declaration is somewhat vague, confusing and contradictory. He does not equivocally state that he never saw the agreement. He states he was not offered arbitration. Perhaps this is the same thing. He indicates he does not speak English, but Defendant’s evidence establishes the agreement was in English and in Spanish. Curiously, he seems to admit to signing documents in 2022 and 2023, but does not suggest what they were—he suggests he was forced to execute the