E&T Foods, Inc. v. RHE, LLC

states that he did not avoid service and that he only learned about this action on April 10, 2026, when a friend informed him of the attempted service at the Hacienda Heights address. (See Chen Decl., P.P. 8-10.) Even if the court accepts as true Chen's claim that he did not avoid service, his declaration does not provide a sufficient basis for the court to find that his inattention to service was excusable. (See Chen Decl., P. 10, only vaguely stating that his "failure to respond was the result of inadvertence, surprise, mistake, or excusable neglect [because he is] not fluent in English and require[s] a Mandarin interpreter in court[.]") Thus, the court finds Chen failed to meet his burden of demonstrating that his lack of notice was not caused by inexcusable neglect.

Therefore, the motion to set aside the entry of default is DENIED. CONCLUSION For these reasons, the motion to set aside default and default judgment, if entered, is DENIED.

Plaintiff E&T Foods, Inc.'s Complaint Respondent: Plaintiff E&T Foods, Inc.

Defendant RHE, LLC's Demurrer to Plaintiff E&T Foods, Inc.'s Complaint is SUSTAINED WITH TWENTY (20) DAYS LEAVE TO AMEND. BACKGROUND This is an action for breach of contract. On September 15, 2008, plaintiff E&T Foods, Inc. (E&T Foods) allegedly entered into a commercial lease agreement with defendant RHE, LLC (RHE) for an initial lease term of fifteen years, including three five-year renewal options followed by an eleven-month renewal option and a right of first refusal to purchase the property if RHE decided to sell and received a bona fide offer.

In 2020, E&T Foods allegedly fell behind on rent payments during the COVID-19 pandemic. On March 19, 2021, RHE allegedly inquired about the missed rental payments, and on March 25, 2021, E&T Foods allegedly expressed its intent to renew the lease and cure the arrearages. On March 30, 2021, RHE allegedly represented that it would not negotiate until E&T Foods cured the arrearages, and on August 30, 2021, RHE allegedly followed up about the arrearages. E&T Foods allegedly paid all arrears in full.

From 2021 to 2025, RHE allegedly accepted E&T Foods's rent payments, including step-up increased payments. In September 2023, E&T Foods allegedly retained possession of the property after the initial fifteen year lease term expired and allegedly continued to

pay rent according to the lease's renewal schedule. In 2025, E&T Foods allegedly learned that RHE intended to sell the property. On February 2, 2026, RHE allegedly declined E&T Foods's offer to purchase the property, even though E&T Foods submitted the highest offer. On February 18, 2026, E&T Foods filed the Complaint, alleging causes of action for (1) breach of contract, (2) declaratory relief, (3) specific performance, (4) breach of the covenant of good faith and fair dealing, and (5) injunctive relief.

On June 25, 2026, RHE filed this demurrer. On July 10, 2026, E&T Foods filed the opposition, and on July 16, 2026, RHE filed the reply. On July 23, 2026, the court continued the hearing on the demurrer to allow the parties to properly meet and confer. This case is set for a case management conference and a continued hearing on the demurrer on August 20, 2026. ANALYSIS RHE generally demurs to the Complaint on the ground that E&T lost its rights under the lease after it defaulted on rent payments.

For the following reasons, the demurrer is SUSTAINED WITH LEAVE TO AMEND. Legal Standard "When any ground for objection to a complaint, cross-complaint, or answer appears on the face thereof, or from any matter of which the court is required to or may take judicial notice, the objection on that ground may be taken by a demurrer to the pleading." (Code Civ. Proc., Sec. 430.30, subd. (a).) A party may demurrer to a cause of action on the ground that the claim is barred, as long as the applicability of the bar appears on the face of the pleading or via proper judicial notice. (See Marshall v.

Gibson, Dunn & Crutcher (1995) 37 Cal.App.4th 1397, 1403, explaining the rule as it applied to a bar raised by a statute of limitations; see also Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994, stating that the ground for demurrer must appear on the face of the pleading or via proper judicial notice.) If the terms of a contract are clear and unambiguous, the court may construe the language of the contract on its face to determine whether it is reasonably susceptible to the plaintiff's claims, and in such cases, the court may sustain a demurrer if the contract is not reasonably susceptible to the meaning alleged in the complaint. (See Shine v.

Williams-Sonoma, Inc. (2018) 23 Cal.App.5th 1070, 1081-1082.)

Discussion

RHE argues that E&T cannot assert any causes of action pursuant to the lease because it defaulted on rent payments.

The court agrees. Under the express terms of the lease between the parties: (c) An Option shall terminate and be of no further force or effect, notwithstanding Lessee's due and timely exercise of the Option, after such exercise and prior to the commencement of the extended term, [] Lessee fails to pay Rent for a period of 30 days after such Rent becomes due without any necessity of Lessor to give notice thereof. . . . (Compl., Exh. A, P. 39.4(c).) The Complaint claims that E&T defaulted on rent payments, paid off its arrearage, and continued to pay rent after the expiration of the original lease term. (See Compl., P.P. 15, 21, 24-25.)

Based on these allegations, the Complaint asks that the fact finder interpret E&T's holdover tenancy as a renewal of the lease term, which would entitle E&T to exercise its options to continually renew the lease and the right of first refusal. (See Compl., P.P. 12-13.) However, E&T's interpretation is inconsistent with the terms of the lease as provided in the attachment to the Complaint. The lease defined the lease term as fifteen (15) years from the commencement date, meaning the final day of the lease term was September 15, 2023. (See Compl., Exh.

A, P. 50; see also Compl., P.P. 11, 25.) As the lessee, E&T did not have a right to holdover after the end of the lease term. (See Compl., Exh. A, P. 26.) However, E&T had an option to renew the lease after the expiration of the lease term. (See Compl., Exh. A, P. 50.) Nevertheless, E&T could only exercise the renewal option "[i]f not under default under the lease." (Compl., Exh. A, P. 50; see also Compl., Exh. A, P. 39.4(c).) Additionally, E&T's default also terminated its ability to exercise its right of first refusal. (See Compl., Exh.

A, P.P. 39.1, 39.4(c).) E&T argues that default does not terminate the lease. (See Opp., pp. 6-7; see also Compl., Exh. A, P. 13.2(b).) However, even if default does not terminate the lease, the court finds it terminates the options of renewal and the right of first refusal. (See Compl., Exh. A, P.P. 39.1, 39.4(c).) Moreover, even though RHE accepted rent payments after the expiration of the original lease term, it did not constitute a waiver of RHE's rights under the lease; the lease permitted RHE to "recover the [r]ent as it becomes due" in the event of E&T's breach, and as stated above, E&T did not have a right to holdover. (Compl., Exh.

A, P. 13.2(b); see Compl., Exh. A, P. 26.) Under these circumstances, the court cannot find that E&T's lease term automatically renewed after the expiration of the original lease term such that E&T retained its right to continue renewing the lease and its right of first refusal after it defaulted on rent. Therefore, the demurrer is SUSTAINED WITH TWENTY (20) DAYS LEAVE TO AMEND.

CONCLUSION For these reasons, the demurrer is SUSTAINED WITH TWENTY (20) DAYS LEAVE TO AMEND. | Home -->)" -->