American Business Bank v. Los Angeles Produce Distributors, LLC, et al.

CASE NUMBER: 25STCV01594 OPPOSED ___________________________________________________________________ Plaintiff American Business Bank's Motion for Summary Judgment against Defendant Los Angeles Produce Fresh ___________________________________________________________________ Facts: This matter arises from a breach of contract. Plaintiff American Business Bank ("Plaintiff") alleges, in relevant part, as follows. Plaintiff, as a lender, entered into a loan agreement (the "First Agreement") with Los Angeles Produce Distributors, LLC ("LAPD") for $3 million, with a maturity date for the loan of July 15, 2022. (Compl., P. 12.)

The First Agreement was guaranteed for $1 million by several defendants, including The Jesus Modesto and Maritza Garcia Living Trust dated March 12, 2014 (the "Trust"). (Ibid.) Defendants Jesus Modesto Garcia ("Jesus") [1] and Maritza Garcia ("Maritza") (collectively "Defendants"), in their capacities as trustees of the Trust, executed a commercial guaranty for $1 million in favor of Plaintiff relating to the First Agreement (the "First Guaranty"). (Id. at P. 17.) Plaintiff and LAPD entered into a second agreement (the "Second Agreement") reducing the principal loan from $3 million to $2 million and extending the maturity date of the First Agreement to January 15, 2024. (Id. at P. 21.)

The Second Agreement was also guaranteed by several defendants, including the Trust for an "unlimited" amount. (Ibid.) The Trust executed a commercial guaranty for an unlimited amount in favor of Plaintiff relating to the Second Agreement (the "Second Guaranty"). (Id. at P. 25.) LAPD defaulted on the loan, and Plaintiff sent a notice of acceleration to the several defendants guaranteeing the loan (the "Notice"), including the Trust. (Id. at P. 28.) The Notice demanded that the guaranteeing parties, including the Trust, pay the sum of $2,019,818.06, plus $694.44 per day for interest, by November 22, 2024. (Id. at P. 30.)

The guaranteeing parties, including the Trust, failed to pay the amount due by November 22, 2024, and Plaintiff seeks to recover the amount due on the

loans. (Ibid.) Procedural History: Plaintiff filed the Complaint on January 21, 2025, alleging causes of action for: 1. Breach of Written Business Loan Agreement; 2. Breach of Written Promissory Note; 3. Breach of Commercial Guaranty; 4. Unjust Enrichment; 5. Fraudulent Inducement; 6. Fraud; 7. Open Book Account; and 8. Account Stated. On March 19, 2025, Plaintiff dismissed the causes of action for unjust enrichment, fraudulent inducement, and fraud against Jesus and the Trust. On August 27, 2025, this court sustained Defendants Jose and Maritza's demurrer to the Complaint, with leave toa mend.

Plaintiff filed the First Amended Complaint ("FAC") on August 27, 2025, alleging eight causes of action in the caption but nine causes of action in the body of the FAC as follows: 1. Breach of Written Loan Agreement (LAPD) 2. Breach of Written Promissory Note (LAPD) 3. Breach of Commercial Guaranty (Clark) 4. Breach of Commercial Guaranty (Jesus Garcia) 5. Breach of Commercial Guaranty (Jesus Garcia and Maritza Garcia as Trustees) 6. Breach of Commercial Guaranty (Fresh) 7. Unjust Enrichment 8.

Fraudulent Inducement

9. Fraud 10. Open Book Account 11. Account Stated On April 15, 2026, this court granted Plaintiff's motion for leave to file a second amended complaint. Plaintiff filed the SAC on April 15, 2026, alleging the same causes of action. On April 20, 2026, Plaintiff dismissed the seventh cause of action for unjust enrichment. On June 25, 2026, this court granted Defendant Los Angeles Produce Fresh, LLC's ("Fresh") motion to compel further responses to requests for production from Plaintiff ABB. This court on June 30, 2026, granted in part Fresh's motion to compel further responses from Plaintiff ABB to interrogatories.

On July 21, 2026, this court denied Plaintiff's motions for summary judgment against Defendants Matthew Clark and Jesus Garcia. On July 23, 2026, this court denied Plaintiff's motion for summary adjudication against Defendant Los Angeles Produce Distributors. On August 10, 2026, this court overruled the demurrer of Defendants Jesus Garcia and Maritza Garcia, as trustees of the Jesus Modesto Garcia and Maritza Garcia Living Trust dated March 12, 2024, to the SAC of Plaintiff. Plaintiff filed the present motion for summary judgment against Defendant Fresh on May 22, 2026.

Defendant Fresh filed an opposition on July 30, 2026. Plaintiff filed a reply on August 6, 2026. Analysis: I. OBJECTIONS Plaintiff American Business Bank's ("Plaintiff") objections to Defendant Los Angeles Produce Fresh, LLC's ("Fesh") submission of the ruling of February 26, 2026, of Department 86 denying Plaintiff's application for writ of attachment are SUSTAINED, as the determinations from such proceedings are not admissible under Code of Civil Procedure Sec. 484.100. II.

MOTION FOR SUMMARY JUDGEMENT A party may move for summary judgment "if it is contended that the action has no merit or that there is no defense to the action or proceeding." (Code Civ. Proc. Sec. 437c, subd. (a).) "[I]f all the evidence submitted, and all inferences reasonably deducible from the evidence and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law," the moving party will be entitled to summary judgment. (Adler v.

Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.) A motion for summary adjudication may be made by itself or as an alternative to a motion for summary judgment and shall proceed in all procedural respects as a motion for summary judgment. (Code Civ. Proc. Sec. 437c, subd. (f)(2).) The moving party bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact, and if he does so, the burden shifts to the opposing party to make a prima facie showing of the existence of a triable issue of material fact. (Aguilar v.

Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850; accord Code Civ. Proc. Sec. 437c, subd. (p)(2).) Plaintiffs moving for summary judgment may meet their initial burden by "prov[ing] each element of the cause of action entitling the party to judgment on the cause of action." (Code Civ. Proc. Sec. 437c(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. (Code Civ.

Proc. Sec. 437c(p)(1).) 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. Sec. 437c(p)(1).) To establish a triable issue of material fact, the party opposing the motion must produce substantial responsive evidence. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 166.)

Plaintiff American Business Bank ("Plaintiff") moves for summary judgment on its sixth cause of action for breach of commercial guaranty against Defendant Los Angeles Produce Fresh, LLC ("Fresh") on the grounds that no triable issues exist as to the existence, validity, and enforceability of the commercial guaranty executed by Fresh to secure an underlying loan agreement between Plaintiff and Defendant Los Angeles Produce Distributors, LLC ("LAP Distributors").) A breach of contract claim requires the plaintiff to show "(1) the existence of the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to the plaintiff." (D'Arrigo Bros. of California v.

United Farmworkers of America (2014) 224 Cal.App.4th 790, 800.) "A lender is entitled to judgment on a breach of guaranty claim based upon undisputed evidence that (1) there is a valid guaranty, (2) the borrower has defaulted, and (3) the guarantor failed to perform under the guaranty." (Gray1

CPB, LLC v. Kolokotronis (2011) 202 Cal.App.4th 480, 486.) Plaintiff presents evidence that it entered into a business loan agreement with Defendant LAP Distributors in October 2023, which was modified pursuant to a "change in terms agreement" dated January 30, 2024, wherein Plaintiff agreed to extend to LAP Distributors a $2 million revolving line of credit with a maturity date of January 15, 2025. (Munson Decl. Exhs. 1, 2.) The modified loan agreement was secured by commercial guaranties executed by Defendants Matthew Clark, Jesus Garcia, and most pertinent to the present motion, both persons purporting to sign a commercial guaranty on behalf of Defendant Fresh. (Munson Decl.

Exhs. 3, 4.) Plaintiff thereafter extended to LAP Distributors via several payments the full $2 million promised under the line of credit, which matured on January 15, 2025, without payment by LAP Distributors or its guarantors. (Munson Decl. P.P. 11-33.) Fresh in its discovery responses has challenged the validity of the signatures on the commercial guaranty, reasoning that Plaintiff failed to obtain the authorization of the majority of managers required under Fresh's operating agreement. (Weiss Decl.

Exh. 2 (Response to Interrogatories No. 41, 48).) That operating agreement states that Fresh is to be governed by managers, subject to election and removal by a majority of the members: Subject to the terms of this Agreement and the California Revised Uniform Limited Liability Company Act, the business and affairs of the Company will be managed by the Board of Managers, as further described below. The Members initially nominate and elect the Person(s) set forth on Exhibit B to serve as the Manager(s) of the Company.

The Managers will act under the direction of the Members and may be elected or removed at any time, for any reason or no reason, by the Members holding a majority of the Voting Interest of the Company. Exhibit B must be amended to reflect any changes in Managers. (Munson Decl. Exh. 5 (Sec. 4.1, A).) Approval and Action. Unless greater or other authorization is required pursuant to this Agreement or under the California Revised Uniform Limited Liability Company Act for the Company to engage in an activity or transaction, all activities or transactions must be approved by a majority of Managers, to constitute the act of the Company or serve to bind the Company, but if the Managers cannot reach a majority vote, the dispute will be submitted to the Members to be resolved by the affirmative vote of the Members holding at least a majority of the Voting Interest of the Company.

With such approval, the signature of any Managers authorized to sign on behalf of the Company is sufficient to bind the Company with respect to the matter or matters so approved. Without such approval, no Managers acting alone may bind the Company to any agreement with or obligation to any third party or represent or claim to have the ability to so bind the Company. (Munson Exh. 5, (Sec. 4.1, B).) Plaintiff argues for

the validity of the guaranty, as follows. Per the above operating agreements, Fresh is a manager-managed LLC. The operating agreement lists in an attached exhibit the following membership interests in the entity: a 51% interest for LAP Distributors, a 30% interest for Patrick Kotani, and a 19% interest for Brian Matsumoto. (Munson Decl. Exh. 5.) Thus a majority membership interest in Fresh was held by Defendant LAP Distributors. Exhibit B to the same agreement lists the managers of Fresh as being LAP Distributors and Patrick Kotani. (Munson Decl.

Exh. 5.) Defendant Matthew Clark sent this operating agreement to Plaintiff on January 12, 2024, prior to the execution of the commercial guaranty at issue. (Munson Decl. P. 8, Exh. 5.) On February 1, 2024, prior to the execution of Fresh's commercial guaranty via Docusign on February 5 and 6, 2024, Clark sent another operating agreement for Fresh, this time with an Exhibit B stamped with the word "Amended," listing Fresh's managers as "Los Angeles Produce Distributors, LLC, and or Matthew Clark." (Munson Decl.

Exh. 6.) Plaintiff also received a document entitled "Resolution of Limited Liability Company Member," certifying Jesus Garcia's status as a managing member of LAP Distributors, Matthew Clark's status as a managing member of Sierra Nevada Produce, LLC, that company's status as a managing member of LAP Distributors, and LAP Distributors' status as controlling member of Fresh. (Munson Decl. Exh. 7.) Plaintiff argues from the above facts for the validity of Fresh's commercial guaranty. LAP Distributors was at all times the majority member of Fresh and one of its managers.

Under the operating agreement, LAP Distributors thus had the authority to appoint or remove managers at any time for any reason, and to make decisions for the company when a majority vote of the managers could not be had. Under the operating agreement, LAP Distributors was one of two managers, alongside Patrick Kotani. And LAP Distributors, as the majority member of Fresh, had the authority to appoint or remove managers at any time and for any reason, and accordingly removed Kotani as a manager, and added Matthew Clark, in an amended operating agreement that was presented to Plaintiff prior to execution of the Fresh guaranty.

The Fresh guaranty was thereafter executed by the managing members of LAP Distributors, as permitted by the amended operating agreement. (Motion at pp. 19, 21-22.) Additionally, Plaintiff points to Corporations Code Sec. 17703.01, subd. (d), which states as follows: (d) Notwithstanding the provisions of subdivision (c), any note, mortgage, evidence of indebtedness, contract, certificate, statement, conveyance, or other instrument in writing, and any assignment or endorsement thereof, executed or entered into between any limited liability company and any other person, when signed by at least two managers, or by one manager in the case of a limited liability company whose articles of organization state that it is managed by only one manager, is not invalidated as to the limited liability company by any lack of authority of the signing managers or manager in the absence of actual knowledge on the part of the other person that the signing managers or manager had no authority to execute the same.

(Corp. Code Sec. 17701.03, subd. (d).) Plaintiff thus argues that even if the managerial signatories to the Fresh guaranty lacked actual authority to bind Fresh, this lack of authority does not obviate the validity of the guaranty unless Plaintiff had actual knowledge that they had no authority to execute the document. (Motion at pp. 19-20.) But Plaintiff argues that it did not have actual knowledge of the signatories' lack of authority, as the signatories were in fact acting as managers of Fresh, and affirmatively represented that they had authority to sign for the guaranty.(Ibid.)

Fresh in opposition challenges the validity of the guaranty on the following grounds. Per the original operating agreement, "a majority of managers" were required to bind Fresh to any transaction. (Opposition at p. 10-12.) As the original operating agreement lists two managers -- LAP Distributors and Kotani -- the act of any one was insufficient to bind Fresh without the signature of the other, as the unilateral act of either would constitute only the act of half the managers, not the required majority. (Ibid.)

It is undisputed that only LAP Distributors, through Defendants Clark and Garcia, signed the guaranty at issue, and that Kotani did not. Fresh argues that the operating agreement with the amended exhibit B listing LAP Distributors and Clark as managers was invalid. (Opposition at pp. 13-15.) Fresh notes that section 4.1, C of the operating agreement requires "unanimous approval of the Members in a consent in writing" for certain specified corporate acts, including "[t]he amendment of this agreement." (Munson Decl.

Exh. 5, (Sec. 4.1, C(vi)).) And because the agreement requires the amendment of Exhibit B listing its managers following any change thereto, Fresh argues that the removal of Kotani from the list of managers required unanimous consent of the members, which was not obtained. (Opposition at p. 13.) Fresh further argues that even if LAP Distributors, as the majority member of Fresh, possessed the unilateral authority to appoint or remove managers, in doing so it was still required to abide by Article 6 of the operating agreement. (Opposition at p. 14.)

That section states: The Members have the right and power to vote on all matters with respect to which the Articles of Organization, this Agreement, or the California Revised Uniform Limited Liability Company Act requires or permits. Unless otherwise stated in this Agreement (for example, in Section 4.l(c)) or required under the California Revised Uniform Limited Liability Company Act, the vote of the Members holding at least a majority of the Voting Interest of the Company is required to approve or carry out an action. (Munson Decl.

Exh. 5 (Sec. 6.1).) The agreement elsewhere states the process necessary for members to act: In any instance in which the approval of the Members is required under this Agreement, such approval may be obtained in any manner permitted by the California Revised Uniform Limited Liability Company

Act, including by conference call or similar communications equipment. Any action that could be taken at a meeting may be approved by a consent in writing that describes the action to be taken and is signed by Members holding the minimum Voting Interest required to approve the action. If any action is taken without a meeting and without unanimous written consent of the Members, notice of such action must be sent to each Member that did not consent to the action. (Munson Decl. Exh. 5 (Sec. 6.2).)

Thus under the above section, even if LAP Distributors as majority member was entitled to unilaterally remove or appoint managers for Fresh, Fresh argues it was required to send "notice of such action to each Member that did not consent to the action." (Ibid.) But Fresh's other members, Kotani and Brian Matsumoto, present declarations stating that their consent was never sought for the change in managers, they were never notified of any proposed amendment to the manager list in Exhibit B, and were not informed of the Fresh guaranty until commencement of litigation here. (Kotani Decl.

P.P. 10-17; Matsumoto Decl. P.P. 5-11.) Fresh further argues that, even taking the operating agreement with the amended Exhibit B as operative, it does not save the guaranty agreement, because even with the amended manager list, a majority of managers -- i.e. both LAP Distributors and Clark -- would have had to approve the commercial guaranty, whereas the guaranty here is signed only by Clark and Garcia in their capacity as managing members (or the principal of a corporate managing member) for LAP Distributors, and Clark does not sign in his capacity as manager for Fresh. (Opposition at p. 17.)

Fresh thus argues that under either version of the operating agreement, containing either manager list, Plaintiff cannot avail itself of the safe harbor provision of Corporations Code Sec. 17701.03, subd. (d), because the defectiveness of the commercial guaranty is apparent from the face of Fresh's operating agreements. No triable issues exist as to the validity of the commercial guaranty under Corporations Code Sec. 17701.03, subd. (d), because Defendant LAP Distributors had the unilateral authority to appoint or remove directors, and both it and Clark presented operating agreements and other documents affirmatively representing that they possessed authority as managers of Fresh to bind it pursuant to the commercial guaranty, and no evidence suggests that Plaintiff had actual knowledge of any lack of authority.

First, as Plaintiff notes, although the operating agreement requires majority approval of managers to enter into any transaction on behalf of Fresh, it also includes a provision permitting the majority member to unilaterally remove or appoint the managers. (Munson Decl. Exh. 5 (Sec. 4.1, A.) The other provision requiring unanimous member approval for amendments to the operating agreement must be read in concert with this express grant of unilateral authority, and thus be understood to mean that the replacement of managers, or the list thereof in Exhibit B, does not constitute an amendment to the operating agreement requiring unanimous approval.

Plaintiff was thus entitled to rely upon the amended manager list presented to it by the manager and majority member of Fresh with the authority to appoint and remove managers. If such change in managers was secured without the notice to other members required of Article 6 of the operating agreement,

there is no argument that the failure to provide such post hoc notice could have retroactively invalidated the removal or appointment, nor any evidence that Plaintiff was ever aware of this lack of notice. There are no triable issues as to the validity of the commercial guaranty because there are no triable issues as to whether Plaintiff was aware of any lack of authority of its signatories. First, although Garcia and Clark signed the agreement only listing their capacities as managing members for LAP Distributors or Sierra Nevada Produce, LLC, the operating agreement does not require that a majority of managers sign the guaranty -- only that the transaction be "approved" by a majority thereof. (Munson Decl.

Exh. 5 (Sec. 4.1, B.) Having been presented with an amended manager list describing Clark and LAP Distributors as managers, and with several documents signed by Clark approving the guaranty, Plaintiff had no basis to believe that Clark did not approve the transaction in his capacity as manager for Fresh. To the extent Clark's execution was necessary on the guaranty, it is under the safe harbor provision of Corporations Code Sec. 17703.01, subd. (d), which requires as condition for application of the safe harbor that the writing be " signed by at least two managers, or by one manager in the case of a limited liability company whose articles of organization state that it is managed by only one manager." (Corp.

Code Sec. 17703.01, subd. (d).) But applicable case authority holds that Clark's signature on the guaranty, even in the wrong or incomplete capacity, is sufficient to avail Plaintiff of the safe harbor provision. In the case Western Surety Co. v. La Cumbre Office Partners, LLC (2017) 8 Cal.App.5th 125, the court summarized its facts and holding as follows: A natural person is the managing member of a limited liability company (LLC 1) that is the sole manager of another limited liability company (LLC 2).

The person signs an agreement on behalf of LLC 2, but misstates his position as the managing member of LLC 2 instead of the managing member of LLC 1, LLC 2's manager. LLC 1 does not have actual authority to execute the agreement on behalf of LLC 2. In these circumstances, does the person's signature bind LLC 2? We conclude that it does pursuant to Corporations Code former Corporations Code section 17157, subdivision (d) (now Sec. 17703.01, subd. (d)), provided that the other party to the agreement does not have actual knowledge of the person's lack of authority to execute the agreement on behalf of LLC 2. (Western Surety Co. v.

La Cumbre Office Partners, LLC (2017) 8 Cal.App.5th 125, 127-128.) The court there relied on cases applying earlier versions of the same statute at issue here, or similar provisions applicable to corporations: In Greve the defendant was a corporation that had entered into a commission agreement. Various officers of the corporation signed the agreement "without any designation as to their official characters [i.e., positions]." (Greve, supra, 101 Cal.App. at p. 349, 281 P. 641.) The corporation contended "that the affixing of [its] name ... to the commission agreement by the officers without setting forth their

official designation is insufficient to constitute the agreement an obligation of the corporation." (Ibid.) The appellate court held to the contrary: "[W]hen the name of a corporation is attached to an agreement by its proper officers, it is unnecessary to attach to the names of the persons executing the agreement for the corporation the official designation of the one who signs his name, but ... such official designation may be otherwise established." (Id., at p. 350, 281 P. 641; see also Snukal, supra, 23 Cal.4th at p. 780, fn. 8, 98 Cal.Rptr.2d 1, 3 P.3d 286 [citing Greve as supporting authority, Supreme Court noted, "At common law, when the corporate officer's actual authority to execute the agreement has been established or is not in doubt, the circumstance that he or she does not specify the office held does not invalidate the agreement as to the corporation"].) (Western Surety Co., supra, 8 Cal.App.5th at pp. 133-134.)

The court went on to describe another case with analogous facts: In Snukal a corporate official, Lyle, executed a lease on behalf of the corporation, Flightways. Lyle was president, chief financial officer, and secretary of Flightways. He signed the lease only as president. To fall within the safe harbor of section 313, the statute required that the lease be signed by a person holding at least one corporate office in each of two separate categories of offices. (See fn. 4, ante.) The office of president is in one category, while the offices of chief financial officer and secretary are in another category.

Thus, for Flightways to be bound under section 313, both the president and chief financial officer or secretary, were required to sign the lease. Our Supreme Court rejected Flightways's claim that Corporations Code section 313 "applies only when two officers holding the offices specified in the statute execute an instrument and name the corporate offices held --whether the requisite offices are held by the same person or by two persons." (Snukal, supra, 23 Cal.4th at p. 777, 98 Cal.Rptr.2d 1, 3 P.3d 286.)

The court held: "Corporations Code section 313 does not contain any language directing that the signing officers be separate individuals, or that the signing officers specify the office or offices they hold. Accordingly, although Corporations Code section 313 applies only where corporate officers in each of the two designated series or categories execute the instrument, that statute ... is satisfied when one individual who in fact holds two of the specified corporate offices executes the instrument. [Citation.]" (Id., at p. 786, 98 Cal.Rptr.2d 1, 3 P.3d 286,fn.omitted, italics added.) "In the present case, therefore, because Lyle served both as Flightways's president and as its chief financial officer (and secretary), and because plaintiff did not have actual knowledge of any lack of authority on Lyle's part, the lease agreement was not invalidated by Lyle's lack of authority to enter into such an agreement on behalf of Flightways." (Id., at p. 787, 98 Cal.Rptr.2d 1, 3 P.3d 286, fn.omitted.) (Western Surety Co. v.

La Cumbre Office Partners, LLC (2017) 8 Cal.App.5th 125, 134.) The court drew from this case the reasoning that, "the signer's offices need not be set forth in the instrument signed. What matters is whether the signer is the person he is statutorily

required to be." (Id. at p. 135.) Here, the guaranty that Plaintiff seeks to enforce was signed by Defendants Garcia and Clark on behalf of LAP Distributors as manager of Fresh, but Clark did not list himself in his capacity as manager of Fresh in his own right. Under the above authority, this is immaterial. Having been named as a manager by the majority member of Fresh, he was the person he was statutorily required to be, and Plaintiff had no basis for believing otherwise. Fresh finally argues that Plaintiff ought to have suspected that Clark and Garcia were not authorized to sign on behalf of LAP Distributors -- separate and apart from Fresh -- because no statement of information for the entity was filed until August 2024, after the execution of loan agreements, listing Garcia and Sierra Nevada Produce as managing members. (Opposition at pp. 18-19.)

But Plaintiff does not contend that either Sierra Nevada Produce or Garcia were not who they said they were in relation to LAP Distributors. It only offers this argument as evidence that Plaintiff failed to do its due diligence. (Opposition at pp. 18-1.) Fresh articulates no basis upon which the failure of Plaintiff to exercise due diligence, or to comply with any internal investigation guidelines, could afford it any relief from the guaranty. (See Colony Ins. Co. v. Crusader Ins. Co. (2010) 188 Cal.App.4th 743, 752 ["Colony cites no authority for the proposition that Crusader's internal Guidelines, standing alone, created any rights enforceable by Colony."].)

Even if Fresh had demonstrated that Plaintiff was negligent in proffering the guaranty to managers without authority to sign, that guaranty would still be valid absent Plaintiff's actual knowledge of the lack of such authority, even if Plaintiff had been negligent in its assessment. (Snukal v. Flightways Mfg., Inc. (2000) 23 Cal.4th 754, 783 ["Because the statute applies even when the other party should have, but does not have, actual knowledge of the officers' lack of authority, that party is relieved of the burden of establishing justifiable reliance upon the authority of the executing officers."].)

However, the above analysis applies only in relation to the validity of the guaranty agreement, and questions remain concerning whether Plaintiff is entitled to judgment on its breach of guaranty claim. In the time since the present motion was filed, two other motions for summary judgment filed by Plaintiff against other defendants have been denied, including a motion directed to a commercial guaranty executed by Clark as to the same underlying loan, in which the court found that triable issues existed as to whether Plaintiff breached the underlying loan agreement by issuing a notice of acceleration based on alleged defaults that it had waived in the preceding months, thus preventing LAP Distributors from paying the amounts owed under the revolving line of credit. (See 7/21/2026 Order.)

The parties do not discuss whether the triable issues of fact identified in these prior orders militate against summary judgment here, as Fresh's guaranty agreement secures the same underlying debt for which triable issues were found. Accordingly, hearing on the present motion is CONTINUED to permit additional briefing concerning the effect of this court's orders of July 21 and 23, 2026, denying Plaintiff's

motions for summary judgment against Defendants Los Angeles Produce Distributors, LLC and Matthew Clark, upon the present motion. Superior Court of California County of Los Angeles Department 732 American Business Bank, Plaintiff, v. Los Angeles Product Distributors, LLC, et al. Defendant(s). | Case No.:

Hearing Date: August 20, 2026 [TENTATIVE] RULING RE: Plaintiff American Business Bank's Motion for Summary JUDGMENT against Defendant Los Angeles Produce Fresh. | Hearing on Plaintiff American Business Bank's Motion for Summary Judgment against Defendant Los Angeles Produce Fresh is CONTINUED to permit additional briefing concerning the effect of this court's orders of July 21 and 23, 2026, denying Plaintiff's motions for summary judgment against Defendants Los Angeles Produce Distributors and Matthew Clark, upon the present motion.

Plaintiff to give notice. Dated: August 20, 2026 __________________________________________ Hon. Richard S. Kemalyan Judge of the Superior Court [1] In light of the parties sharing the same last name, the Court shall respectfully refer to the parties by their first name, where applicable. Case Number: 25STCV08480 Hearing Date: August 20, 2026 Dept: 732 Thelma Romero Ortiz v. LPQ USA, LLC et al. Thursday, August 20, 2026 |