GRANITE CONSTRUCTION COMPANY v. FIDELITY AND DEPOSIT COMPANY OF MARYLAND, et al.

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 17, 2026 TIME: 8:30 A.M.

No. 26CV00774

GRANITE CONSTRUCTION COMPANY v. FIDELITY AND DEPOSIT COMPANY OF MARYLAND, et al.

PLAINTIFF GRANITE CONSTRUCTION COMPANY’S APPLICATION FOR CHRISTOPHER OLSEN TO APPEAR PRO HAC VICE

The application of Christopher Olsen, on behalf of plaintiff Granite Construction Company, complies with Cal. Rules of Court, rule 9.40 and is granted.

DEFENDANTS SWINERTON BUILDERS, FIDELITY AND DEPOSIT COMPANY, ZURICH AMERICAN INSURANCE, AND LIBERTY MUTUAL INSURANCE COMPANY’S MOTION FOR STAY AND TO COMPEL ARBITRATION

Defendants’ motion to stay this action is granted. The court declines to rule on defendants’ alternative request that any dispute solely between plaintiff and defendants is compelled to arbitration under their agreement; no such dispute appears to be at issue. In the event one arises and the parties do not agree to arbitrate, a motion to compel arbitration can be filed.

I. INTRODUCTION AND PARTIES

This dispute relates to the Phase 2 Kresge College contract at UCSC. The Regents (“Owner”) hired Swinerton as the general contractor. (Burke Declaration, Exhibit 1, “Prime Contract”.) Swinerton hired Granite Construction Company (Granite) as a subcontractor for demolition, earthwork and utility work. (Burke Decl., Ex. 2 [Master Subcontractor Agreement (“MSA”)].) Granite thereafter entered into subcontracts with at least three lower-tier subcontractors. Over the course of the work performed under the MSA, the MSA sum escalated from over $17 million to over $24 million. (First Amended Complaint (FAC) ¶¶ 19-20.)

Granite filed this action alleging Swinerton breached the MSA by refusing to compensate Granite for delays not in Granite’s control, allowance work in excess of the adjusted values for allowance items, and change order work due to scope and design changes during performance. (FAC ¶ 21- 35.) Granite alleges it is entitled to recover all such unpaid costs under the $20 million payment bond on the project. (FAC Ex. C.) Granite filed its amended complaint on April 8, 2026, for one cause of action for recovery on payments bond (Civil Code § 9564) and named Fidelity and Deposit Company of Maryland, Zurich American Insurance Company, Liberty Mutual Insurance Company, and Swinerton Builders as defendants.

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 17, 2026 TIME: 8:30 A.M.

II. LEGAL STANDARDS

“[W]hen a petition to compel arbitration is filed and accompanied by prima facie evidence of a written agreement to arbitrate the controversy, the court itself must determine whether the agreement exists and, if any defense to its enforcement is raised, whether it is enforceable.” (Esparza v. Sand & Sea, Inc. (2016) 2 Cal.App.5th 781, 787.) The trial court decides whether there is an agreement to arbitrate between the parties, and whether the agreement covers the dispute at issue. (Omar v. Ralphs Grocery Co. (2004) 118 Cal.App.4th 955, 960.) If defendant meets its burden of proving the existence of a valid arbitration agreement by a preponderance of the evidence, the burden then shifts to plaintiff: “a party opposing the petition bears the burden of proving by a preponderance of the evidence any fact necessary to its defense.” (Esparza, supra, 2 Cal.App.5th at 787.)

“Only the valid and binding agreement of the parties, including all material terms welldefined and clearly expressed, may be ordered specifically performed.” (Avery v. Integrated Healthcare Holdings, Inc. (2013) 218 Cal.App.4th 50, 71.) An arbitration agreement “must be so interpreted as to give effect to the mutual intention of the parties as it existed at the time of contracting, so far as the same is ascertainable and lawful.” (Civil Code § 1636.) The language of the contract governs its interpretation if it is clear and explicit. (Civil Code § 1368.)

III. DISCUSSION

A. Contract terms at issue

The MSA requires arbitration only as to disputes solely between Granite and Swinerton: “Disputes between Contractor and Subcontractor. If a Dispute is only between Contractor and Subcontractor, then the dispute resolution procedure set forth in Paragraphs 15(e) through 15(f) below shall apply. Contractor reserves the right to consolidate any mediation, lawsuit or arbitration arising under this Agreement or a WO [work order] with any mediation, lawsuit or arbitration relating to disputes between Contractor and Owner. Subcontractor shall include in each of its sub-tier agreements a specific provision whereby the necessary party agrees to be joined or consolidated with any dispute procedure between Contractor and Subcontractor.” [Emphasis added.] (Burke Decl., Ex. 2, § 15(d)).

Further, the MSA provides that where a dispute pertains in any way to a dispute or claim between the Regents and Swinerton, the Prime Contract’s dispute resolution provisions govern. “Disputes under the Prime Contract. If a Dispute between Subcontractor and Contractor pertains in any way to a claim, dispute, or matter in question between Contractor and Owner arising out of or relating to the Prime Contract Documents, then the Dispute will be decided using the same law, procedures, forum, and process set forth in the Prime Contract Documents, regardless of whether Subcontractor formally joins the process as a litigant or named party. [...] Subcontractor

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 17, 2026 TIME: 8:30 A.M.

further agrees to stay any action filed by the Subcontractor against Contractor until the dispute between Contractor and Owner is resolved....” (Burke Decl., Ex. 2, § 15(b), emphasis added.)

The Prime Contract sets forth the procedures for submission of change order requests to the Regents, followed by its review and decision as to them. (Burke Decl., Ex. 1, Prime Contract, General Conditions, Article 4.2.) While Swinerton may contest decisions on change order requests by filing claims, only “final decisions” may be contested. (Burke Decl., Ex. 1, Prime Contract, Articles 4.2.4 and 4.3.2.) Following claim submissions, the dispute resolution procedures of the Prime Contract provide for an informal conference to meet and confer, mediation, and ultimately, litigation or arbitration. (Burke Decl., Ex. 1, Prime Contract, Articles 4.3, 4.5.2, 4.6, and 4.7.)

B. Prime Contract, not MSA, controls timing here

During its work on the project, Granite submitted its change order requests to Swinerton. Swinerton, in turn, submitted all such change order requests on a “pass through” basis, in change order requests to the Regents. (Burke Decl., ¶ 7.) Granite’s amended complaint against Swinerton and its sureties alleges $6.2 million in unpaid labor, materials and equipment furnished by Granite and its lower-tier subcontractors. As of this motion, those change order requests are still pending – the Regents have yet to make a “decision . . . which states that it is final” or “written final decision” under Articles 4.2.3 and 4.3.2 of the Prime Contract – so no valid claims have arisen under the Prime Contract’s dispute resolution provisions. (Burke Decl., ¶ 8.)

Swinerton and the Regents have continued to meet diligently, in an effort to resolve the change orders, including Granite’s claims. (Burke Decl., ¶ 9.)

Here, the court finds that the dispute between Granite and Swinerton (based on the MSA) necessarily relates to and is intertwined with the Prime Contract and the Prime Contract therefore governs this dispute. Swinerton passed through Granite’s change orders to the Regents but the Regents have yet to act on them, allegedly causing delays which are the subject of Granite’s claims against Swinerton. Since the dispute is subject to the Prime Contract and its dispute resolution procedures, Granite’s claims must be stayed pending resolution as between Swinerton and the Regents.

Further, the MSA contemplates this situation: “Contractor [Swinerton] reserves the right to consolidate any mediation, lawsuit or arbitration arising under this Agreement or a WO [work order] with any mediation, lawsuit or arbitration relating to disputes between Contractor and Owner.” (Burke Decl., Ex. 2, § 15(d)). Therefore, Granite had ample notice based upon the terms of the MSA that its claims against Swinerton could and likely would be consolidated in any dispute resolution process between Swinerton and the Regents.

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 17, 2026 TIME: 8:30 A.M.

Granite cannot avoid this sequence of events by bringing a purely statutory claim for recovery on the payment bond. Granite’s bond claims against the sureties are derivative of its claims against Swinerton and survive the claims dispute. (Civil Code § 2809; see also Cates Construction Inc. v. Talbot Partners (1999) 21 Cal.4th 28, 38 [in absence of default of the principal, the surety has no obligation]; Morgan Creek Residential v. Kemp (2007) 153 Cal.App.4th 675, 685-6 [“Generally, a surety's liability for an obligation is secondary to, and derivative of, the liability of the principal for that obligation.”]; Fed.

Ins. Co. v. Superior Court (1998) 60 Cal.App.4th 1370, 1373 [“[t]he carriers’ liability under the bond will arise only if the contractor fails to pay for work performed under the contract” and the claim on the bond “necessarily involves the determination of whether [claimant] is entitled to be paid.”]) Payment on the bond can only be made once the payment dispute is resolved. (Id. at p. 1374.)

Granite argues its claim against the surety defendants exists entirely independent of any contractual relationship between it and Swinerton. But that makes little sense. The only reason the payment bond exists is to protect the interests of Swinerton’s subcontractors on the project in the event of nonpayment. (Olsen Decl., Ex. 6.) Additionally, payment on the subcontracts is directly related to approval of change orders by those subcontractors, thereby making the payment bond dependent on Granite’s and Swinerton’s contractual relationship (as well as the Prime Contract). Further, delayed payment – not refusal to pay or nonpayment – has occurred.

Granite also argues that Swinerton abandoned the procedures for resolving disputes under the Prime Contract by deviating from the designated process and engaging in private, noncontractual mediation for the past 16 months with the Regents. Granite argues it was not invited to participate and has not agreed it would delay enforcement of its alleged statutory rights indefinitely while those parties mediate. However, there are no contractual provisions that allow Granite to proceed against Swinerton for lack of payment without a final decision on change orders. (Burke Decl., Ex. 1, Prime Contract, General Conditions, Articles 4.2.4, 4.3.2.) Regardless of how the Regents and Swinerton have conducted their efforts to finalize claims – in private mediation or not – Granite’s passed-through change orders are not yet resolved, requiring its dispute be stayed.

Based upon the terms of the MSA, Granite’s claims against Swinerton shall be stayed pending resolution of the Regents/Swinerton dispute. (Burke Decl., Ex. 2, § 15(b).)

C. Defendants’ request for judicial notice

1. April 9, 2025, Order, Granite Construction Company v. Swinerton Builders, et al., Santa Cruz County Superior Court no. 24CV02012: Granted.

2. August 27, 2025, Order, Granite Construction Company v. Swinerton Builders, et al., Santa Cruz County Superior Court no. 24CV02012: Granted.

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 17, 2026 TIME: 8:30 A.M.

No. 25CV02436

BANK OF AMERICA, N.A. v. FARLEY

DEFENDANT’S MOTION TO DISMISS

PLAINTIFF’S MOTION FOR ORDER THAT MATTERS IN REQUESTS FOR ADMISSIONS OF TRUTH OF FACTS BE DEEMED ADMITTED

The motion to dismiss is denied. The motion for an order deeming admitted the truth of facts in the request for admissions is granted unless defendant provides proof of service of responses in substantial compliance with Code of Civil Procedure section 2033.220.

I. BACKGROUND AND MOTIONS This is a collections case based upon unpaid credit card debt. Plaintiff seeks $18,530.54 and alleged breach of contract. On September 19, 2025, self-represented defendant filed an answer, arguing plaintiff failed to provide a signed contract.

Plaintiff filed a motion to deem admitted certain requests for admission. The hearing on this motion occurred on July 20, 2025. The court’s tentative ruling was to grant the motion. However, plaintiff’s counsel failed to appear at the hearing and the court noted that defendant had filed a motion to dismiss which was pending. The court continued the discovery hearing August 17, 2026, along with defendant’s motion to dismiss.

A. Defendant’s motion to dismiss First, defendant failed to file a proof of service showing that the motion was served on defendant. “Unless otherwise ordered or specifically provided by law, all moving and supporting papers shall be served and filed at least 16 court days before the hearing.” Proof of service of the moving papers must be filed no later than five court days before the hearing date. (Code of Civ. Proc. § 1005, subd. (b); Cal. Rules of Ct., rule 3.1300(c).)

Even assuming the motion was properly served, it would be denied. Defendant asks the court to dismiss the case based upon “lack of evidence” of a signed promissory note and/or signed contract or agreement. Defendant asserts she was the victim of identity theft. It appears defendant is seeking the court to summarily adjudicate plaintiff’s claims. However, she did not bring a motion for summary judgment. The motion to dismiss is denied for these reasons.

B. Plaintiff’s motion to deem admitted requests for admissions On December 12, 2025, plaintiff served requests for admission set one, on defendant, attached to the declaration of Smita Suman as Exhibit 1. Plaintiff states defendant has failed to