BELVEDERE LAGOON LLC v. HACHMAN CONSTRUCTION INC., ET AL

On July 30, 2026, the court entered summary adjudication on Defendants Hachman Construction, Inc. (“HCI”) and Timothy Hachman’s (“Hachman”; together with HCI, “Defendants”) motion for summary adjudication of Plaintiff Belvedere Lagoon, LLC’s (“Plaintiff”) as to the Fifth Cause of Action in the Complaint. In that order, the court carefully noted that that ruling did not bear on Plaintiff’s ability to amend to complaint to assert a cause of action by John and Charlotte Doyle, individually.

A rereading of that order explains that this lawsuit was filed in the name of Plaintiff Belvedere Lagoon LLC only. Plaintiff Belvedere Lagoon LLC consist of Jon and Charlotte Doyle (“the Doyles”) and members of the LLC. They created Plaintiff to hold title to 54 Peninsula Boulevard, the property at the center of this litigation. The Doyles arranged for Defendants to perform the remodel. Using the LLC as a shield, they are not plaintiffs in this case.

It is undisputed that all of the money paid to Defendant HCI in connection with the project at 54 Peninsula Boulevard ($1,582,896.38 in total) was paid from bank accounts that were in the name of John and Charlotte Doyle or their trust, not in the name of Plaintiff, the couple’s LLC. “A limited liability company is an entity distinct from its members.” (Corp. Code, § 17701.04, subd. (a).) Money held in an account in the name of the Doyles or their trust necessarily belongs to the Doyles or to their trust and not to Plaintiff, a separate legal entity. Plaintiff did not pay any funds to HCI.

Plaintiff necessarily cannot prevail on a cause of action under Section 7031(b) because the section enables “a person who utilizes the services of an unlicensed contractor” to “bring an action . . . to recover all compensation paid to the unlicensed contractor for performance of any act or contract.” (Bus. & Prof. Code, § 7031, subd. (b).) The most natural reading of this

language is that Section 7031(b) enables a person who paid an unlicensed contractor for his services to claw back the money paid, and a person who did not give an unlicensed contractor any money cannot reap any benefit from the same statute. (See Eisenberg Village etc. v. Suffolk Construction Co., Inc. (2020) 53 Cal.App.5th 1201, 1211; [Section 7031(a) “precludes an unlicensed contractor (but not the other party to the contract) from enforcing the contract[,]” and if the other party to the contract brings a timely action under Section 7031(b), that provision “requires the unlicensed contractor to return all compensation received from that party”] [emphasis added].) Here, the Plaintiff LLC did not make the payments, and therefore cannot claw back funds, which is why the Doyles wish to enter the lawsuit by an Amended Complaint.

“We hold that the one-year statute of limitations applies to claims for disgorgement under section 7031(b). We also hold that the discovery rule does not apply, and that a section 7031(b) claim accrues upon the completion or cessation of the performance of the act or contract at issue.” (Eisenberg Village etc. v. Suffolk Construction Co., Inc. (2020) 53 Cal.App.5th 1201, 1203; accord, SF CDC, LLC v. Webcor Construction, LLC (2021) 62 Cal.App.5th 266 at 277-281.

Eisenberg rejected a parties ability to seek cover under the “delayed discovery” rule at 1214- 1215:

To avoid such absurd results, and because there is no reason in equity to apply it, we hold that the discovery rule does not apply to section 7031(b) claims. ...In the case of a section 7031(b) claim, the cause of action is complete when an unlicensed contractor completes or ceases performance of the act or contract at issue.

Checks were written by the Doyles to HCI invoices totaling $1,586,066.78 from their own bank account, not their LLC’s bank account. The Doyles did not make a mistake; they specifically intended to create an LLC to deal with the construction, while at the same time were the actual payors to HCI. They did not make a mistake which would qualify them as being a misnamed or mistaken Plaintiff. Their position with the LLC was open and notorious by their independent check writing. They intentionally attempted to limit their personal liability by using the LLC to manage the construction. The problem here was created by the LLC in an effort to protect the Doyles from liability. (See, Bartalo v. Superior Court (1975) 51 Cal.App.3d 526.)

Substituting the Doyles does not cure a technical pleading defect. Rather, adding new plaintiffs allows them to assert independent statutory rights after the statutory limitations period applicable to that right has expired. In cases where the wrong LLP party was plead, a partner or entity may not join after the Statute of Limitations has expired, standing in the same shoes as the misidentified entity, particularly when the sole reason for the party to come to the litigation at the late hour was to cure an obvious pleading defect. (See, Engel v. Pech (2023) 95 Cal.App.5th 1227, 1231.)

Most requests for leave to amend a complaint are routinely granted, in an effort by the court to move the case along when there is a finding of no prejudice to the Defendant. In this case however, the weight of California authority stands in the way of Plaintiff’s request. The request for leave to amend is the complaint is DENIED.

Parties must comply with Marin County Superior Court Local Rules, Rule 2.10(A), (B), which provides that if a party wants to present oral argument, the party must contact the Court at (415) 444- 7046 and all opposing parties by 4:00 p.m. the court day preceding the scheduled hearing. Notice may be by telephone or in person to all other parties that argument is being requested (i.e., it is not necessary to speak with counsel or parties directly.) Unless the Court and all parties have been notified of a request to present oral argument, no oral argument will be permitted except by order of the Court. In the event no party requests oral argument in accordance with Rule 2.10(B), the tentative ruling shall become the order of the court.

IT IS ORDERED that evidentiary hearings shall be in-person in Department L. For routine appearances, the parties may access Department L for video conference via a link on the court website. Kindly turn your camera on when your case is called and make sure the party or lawyer making the appearance is properly identified on the screen.

FURTHER ORDERED that the parties are responsible for ensuring that they have a good connection and that they are available for the hearing while using the virtual remote courtroom. If the connection is inadequate, the Court may proceed with the hearing in the party’s absence. If it is determined that you are diving your car during the hearing, you will be removed from the virtual courtroom. (Yes, this happens).