Ryan Caudill vs. Ivan Katrenyak

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undisputed material facts (“UMFs”) to support adjudication of the first and third causes of action, and also failing to establish sufficient support for Plaintiffs’ asserted UMFs 2, 7, 8, 9, 10, 13, 14, 15, 17, 18, 19, 21, 25, 26, 27, 28, 31, 32, 33, 35 and 36. The Court denied Plaintiffs’ prior motion in its entirety and did not order that such denial was without prejudice to re-filing of Plaintiffs’ motion in the future. (See December 9, 2025 Order.)

On March 26, 2026, the Court approved the parties’ stipulation to advance the hearing on Plaintiffs’ motion so as to hold hearings of the two motions for summary adjudication on this date. However, the Court specifically stated in its order that by allowing the hearing on Plaintiffs’ motion to be advanced, the Court was not addressing at that time whether Plaintiffs’ present motion for summary adjudication was properly made.

Trial is now set for July 20, 2026.

Moving Papers

Despite the Court’s December 9, 2025 denial of their prior motion of summary adjudication as to Plaintiffs’ first, third and fourth causes of action, Plaintiffs again move for summary adjudication of their first cause of action for disgorgement and of their third cause of action, violation of Business and Professions Code section 7195. (See Plaintiffs’ Notice of Motion and Motion for Summary Adjudication (present motion), filed March 3, 2026.)

Applicable Law

In ruling on a motion for summary judgment/adjudication, the Court engages in a three-step process. First, the issues framed by the pleadings must be identified since the pleadings themselves define the scope of what may be addressed via a motion for summary judgment/adjudication (FPI Development Inc. v. Nakashima (1991) 231 Cal.App.3d 367, 381- 382) and the evidence submitted in support of or in opposition to the motion must be addressed to the claims and defenses raised in the pleadings. The Court cannot consider an unpleaded issue in ruling on a motion for summary judgment/adjudication. (Roth v. Rhodes (1994) 25 Cal.App.4th 530, 541.) The papers filed in response to such a motion may not create triable issues beyond the scope of the pleadings, nor are they a substitute for filing amended pleadings. (Tsemetzin v. Coast Federal Savings & Loan Assn. (1997) 57 Cal.App.4th 1334, 1342.)

Next, the Court must determine whether the moving party has met its initial burden of production. Code of Civil Procedure §437c, subdivision (p)(1), explains that a plaintiff moving for summary judgment/adjudication meets its “burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action.” This same statutory provision further specifies that only when the moving party has met this initial burden does the burden of production shift to the opposing defendant to “set forth the specific facts showing that a triable issue of material fact exists as to

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the cause of action or a defense thereto.” In other words, a party opposing summary judgment/adjudication has no evidentiary burden unless the moving party has first met its initial burden of production. (Binder v. Aetna Life Ins. Co. (1999) 75 Cal.App.4th 832, 840; see also Rubenstein v. Rubenstein (2000) 81 Cal.App.4th 1131, 1151-1152; Thatcher v. Lucky Stores, Inc. (2000) 79 Cal.App.4th 1081, 1085-1086.)

Only where the moving party makes the requisite initial showing does a court need to examine the opposition papers to determine if the latter demonstrate the existence of a triable issue of material fact which precludes summary judgment/adjudication. (Salazar v. Southern Cal. Gas Co. (1997) 54 Cal.App.4th 1370, 1376; Binder v. Aetna Life Ins. Co. (1999) 75 Cal.App.4th 832, 840.) The opposing party must present admissible evidence and may not rely upon the allegations or denials of its pleading. (Id.)

As noted above, Code of Civil Procedure §437c, subdivision (p)(1), clarifies that the opposing party must “set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.” Additionally, in ruling on the motion, a court must construe the evidence of the opposing party liberally and that of the moving party strictly, resolving any doubts in the opposing party’s favor. (Miller v. Bechtel Corp. (1983) 33 Cal.3d 868, 874; Cortez v. Vogt (1997) 52 Cal.App.4th 917, 925-926; see also Salazar v.

Southern Cal. Gas Co. (1997) 54 Cal.App.4th 1370, 1376; Brown v. FSR Brokerage, Inc. (1998) 62 Cal.App.4th 766, 773.)

While a summary adjudication motion is treated largely the same as one for summary judgment, there are a few important differences. One of these differences is found in CRC Rule 3.1350(b), which mandates that issues presented for summary adjudication be stated in the notice of motion and repeated verbatim in the separate statement. Another difference is that summary adjudication cannot be granted unless it “completely disposes” of a cause of action, affirmative defense, claim for punitive damages, or question of duty. (Code Civ. Proc., § 437c, subd. (f)(1).)

Request for Judicial Notice

Defendants’ request for judicial notice in opposition of Plaintiffs’ motion regarding documents previously filed in this case is granted, but only for the limited purposes appropriate for judicial notice. (See, Evid. Code § 451, subd. (a); § 452, subds, (b)-(d); see also, Johnson & Johnson v. Superior Court (2011) 192 Cal.App.4th 757, 768 [court may take judicial notice of the existence of court documents but not the truth of any statements contained therein].; Kilroy v. State of California (2004) 119 Cal.App.4th 140, 145-148; Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1569-70.)

Objections to Evidence

The Court finds no objections to evidence on file.

Discussion

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Plaintiffs’ Renewed Motion for Summary Adjudication

Although not raised by the parties, a critical threshold issue is whether Plaintiffs’ present motion for summary adjudication complies with the requirements for a renewed motion pursuant to Code of Civil Procedure section 1008, subdivision (b) (Section 1008(b)). As noted, Plaintiffs filed a previous motion for summary adjudication of their first, third, and fourth causes of action, which the Court denied.[1] (See Minute Order, Dec. 9, 2025.) In order to make a subsequent motion for summary adjudication of the same causes of action, Plaintiffs must establish compliance with Section 1008(b), which states:

A party who originally made an application for an order which was refused in whole or part, or granted conditionally or on terms, may make a subsequent application for the same order upon new or different facts, circumstances, or law, in which case it shall be shown by affidavit what application was made before, when and to what judge, what order or decisions were made, and what new or different facts, circumstances, or law are claimed to be shown. For a failure to comply with this subdivision, any order made on a subsequent application may be revoked or set aside on ex parte motion.

(Code Civ. Proc., § 1008, subd. (b); see also § 437c, subd. (f)(2) [“A party shall not move for summary judgment based on issues asserted in a prior motion for summary adjudication and denied by the court unless that party establishes, to the satisfaction of the court, newly discovered facts or circumstances or a change of law supporting the issues reasserted in the summary judgment motion”].) Notably, Code of Civil Procedure section 1008(b) applies to any renewed motions, including Plaintiffs’ motion here.

While Code of Civil Procedure section 437c(f)(2) also prohibits specifically a motion for summary judgment from being made after a motion for summary adjudication on the same grounds was previously denied, Courts of Appeal have applied the same prohibition to any successive motions made pursuant to section 437c. (See Patterson v. Sacramento City Unified School District (2007) 155 Cal.App.4th 821, 827 [extending section 437c(f)(2) to repeated motions for summary judgment].)

Here, there is no question that Plaintiffs’ present motion for summary adjudication is directed to the same causes of action as their prior failed motion for summary adjudication. (See Plaintiffs’ Notice of Motion and Motion for Summary Adjudication (prior motion), filed August 1, 2025; Plaintiffs’ Notice of Motion and Motion for Summary Adjudication (present motion), filed March 3, 2026.) However, Plaintiffs in their moving papers have neither addressed section 1008(b) nor section 437c(f)(2). Plaintiffs have not demonstrated any “new or different facts, circumstances, or law” which support a renewed motion.

Again, the instant motion for summary adjudication is based on the same substantive grounds asserted in the previous motion – (i) that Defendants’ contractor’s license was suspended as a matter of law as a result of the cancellation of their worker’s compensation insurance coverage, and (ii) the construction contract did not comply with Business and Professions Code section 7159. Plaintiffs’ memorandum of points

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and authorities is almost entirely identical to the memorandum in support of the previous motion for summary adjudication. Additionally, Plaintiffs present no new or substantively different undisputed material facts or evidence in support thereof. (Compare Plfs. Sep. Stmnt., Aug. 1, 2025; Plfs. Sep. Stmnt., Mar. 3, 2026.) Plaintiffs’ failure to address section 1008(b) and section 437c(f)(2) and failure present any “new or different facts, circumstances, or law” alone warrants denial of this motion.

Further, even if Plaintiffs had addressed section 1008(b) and section 437c(f)(2) and argued that their present motion presents “new or different facts, circumstances, or law” as compared to their prior failed motion, such mere showing would not be sufficient to avoid denial of this motion. That is because the law imposes an additional limitation that the moving party also demonstrate that the “new or different facts” or law could not, even with reasonable diligence, have been earlier discovered and produced in connection with the earlier motion. (Wilcox v.

Ford (1998) 206 Cal.App.3d 1170, 1180.) Not only have Plaintiffs failed to demonstrate their own reasonable diligence and why its currently presented facts and evidence could not have been discovered and produced in their prior motion, but the actual facts and evidence that Plaintiffs attempt to offer now (as well as their arguments) appear to be either virtually or entirely identical to that in their prior motion. Thus, Plaintiffs’ failure to demonstrate their own diligence provides yet another ground that warrants denial of this motion.

Notably, Plaintiffs’ current motion instead appears to constitute nothing more than an attempt to correct certain deficiencies identified in the Court’s ruling in denying Plaintiffs’ previous motion for summary adjudication, such as identifying in the separate statement the specific causes of action to which the motion is addressed, and other issues. However, denial of Plaintiffs’ motion for summary adjudication was based upon numerous deficiencies, including substantive deficiencies. More importantly, the Court did not specifically rule that its denial of the motion was “without prejudice” to Plaintiffs’ attempting another future motion for summary adjudication.

Thus, the requirements of Section 1008(b) and 437c(f)(2) each apply. Both sections 437c(f)(2) and 1008(b) were enacted to limit redundant or abusive motion practice. (See Bagely v. TRW, Inc. 73 Cal.App.4th 1092, 1096, fn. 3 ['[T]he prohibition against repeated summary judgment motions was added to make the summary judgment process more efficient and to reduce the opportunities for abuses of the procedure [citation] which the additional of subdivision (f)(2) accomplished by overruling the cases that had held that an order denying a motion for summary judgment did not preclude renewal of the same motion at any time before trial'].)

For all of the reasons discussed above, the Court denies Plaintiff’s current motion for summary adjudication in its entirety.

While the Court need not proceed further, it does so only to demonstrate that even if Plaintiffs satisfied the requirements of section 1008(b) and section 437c(f)(2) (which Plaintiffs have not done), their motion would be denied in any event.

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First Cause of Action – Disgorgement pursuant to Bus. & Prof. Code, § 7031, subd. (b).

Under Business and Professions Code section 7031, subdivision (b), a person who hires an unlicensed contractor may 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).)

As indicated earlier, the first step of the summary judgment/adjudication analysis is to determine the issues as framed by the pleadings. (FPI Development Inc. v. Nakashima (1991) 231 Cal.App.3d 367, 381- 382) In this regard, Plaintiffs’ first cause of action alleges they are entitled to recover the amounts they paid to Defendants under this statute because neither IMKAT nor Mikhail had workers’ compensation insurance coverage for Ivan or any other employees when remodel work on Plaintiffs’ home was performed. Business and Business and Professions Code section 7125.2 (hereafter, Section 7125.2) provides for the “automatic suspension” by operation of law of the license of a contractor who fails to obtain or maintain workers’ compensation insurance coverage. (Bus. & Prof. Code, § 7125.2; Loranger v. Jones (2010) 184 Cal.App.4th 847, 849.)

The next step is to determine whether Plaintiffs have satisfied their initial burden as moving party. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850; Code Civ. Proc. § 437c(p)(2).) In their motion for summary adjudication, Plaintiffs argue that because Mikhail’s and IMKAT’s contractor’s license was suspended by operation of section 7125.2, Defendants had no valid contractor’s license when they performed the work at issue and Plaintiffs are entitled to judgment as a matter of law on their disgorgement claim under Business and Professions Code section 7031 (hereafter, Section 7031).

In analyzing whether Plaintiffs would have satisfied their initial burden, the Court notes that Plaintiffs’ motion as to the first cause of action, according to their notice of motion, is that “[a]s a matter of law, IMKAT’s license was automatically suspended when its employees performed work without workers compensation insurance.” (Plaintiff’s Notice of Motion at 2:4-5.) In support of this ground, Plaintiffs do not offer any UMF indicating that the Contractors State License Board (CSLB) sent any type of notice to Defendants regarding the suspension of their license. (See generally, Plaintiffs’ Separate Statement in Support of Motion for Summary Adjudication.) This omission from Plaintiffs’ evidence is presumably based upon Plaintiffs’ argued premise that no such notice was required in order for Defendants’ license to be “automatically suspended.”

In light of Plaintiffs’ argument and its lack of any UMF demonstrating that CSLB sent any notice to Defendants, the Court finds that assessment of whether Plaintiffs have satisfied their initial burden requires the resolution of a question of law: Was IMKAT/Mikhail’s contractor’s license automatically suspended upon the cancellation of its worker’s compensation insurance coverage, or was the CSLB required to notify IMKAT/Mikhail of the pending suspension of its license in

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order for the “automatic suspension” under Section 7125.2 to take effect?

To address this question, the Court begins with the language of Section 7125.2. The relevant provisions of that section state:

The failure of a licensee to obtain or maintain workers' compensation insurance coverage, if required under this chapter, shall result in the automatic suspension of the license by operation of law in accordance with the provisions of this section, but this suspension shall not affect, alter, or limit the status of the licensee as an employer for purposes of Section 3716 of the Labor Code.

(a) The license suspension imposed by this section is effective upon the earlier of either of the following: (1) On the date that the relevant workers' compensation insurance coverage lapses. (2) On the date that workers' compensation coverage is required to be obtained.

(b) A licensee who is subject to suspension under paragraph (1) of subdivision (a) shall be provided a notice by the registrar that includes all of the following: (1) The reason for the license suspension and the effective date. (2) A statement informing the licensee that a pending suspension will be posted to the license record for not more than 45 days prior to the posting of any license suspension periods required under this article. (3) The procedures required to reinstate the license.

(Bus. & Prof. Code, § 7125.2, subds. (a), (b).)

Language in the opening paragraph of Section 7125.2 states that the license suspension is to be “automatic” and shall occur “by operation of law,” which if considered alone, would permit the argument that no action by CSLB is necessary to suspend a contractor’s license once workers’ compensation insurance coverage lapses. (Id. at § 7125.2, subd. (a)(1).) However, the “automatic suspension of the license by operation of law” is specifically modified by the phrase, “in accordance with the provisions of this section,” which includes the notice requirements set forth in subdivision (b). (Id. at § 7125.2.)

As set forth under subdivision (b) of Section 7125.2, a licensee who is subject to suspension for a lapse in workers’ compensation insurance coverage “shall be provided a notice by the registrar [of the CSLB] that includes [t]he reason for the license suspension and the effective date [as well as a] statement informing the licensee that a pending suspension will be posted to the license” for no more than 45 days prior the posting of any license suspension periods. (Bus. &

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Prof. Code, § 7125.2, subd. (b).)

The Court finds that the provisions of subdivision (b) indicate that an “automatic suspension” resulting from a lapse of workers’ compensation insurance coverage is not effective until the CSLB provides the notice required by that subdivision and actually suspends the license. Indeed, to construe Section 7125.2 otherwise would be inconsistent with its specific language in subdivision (b) which not only requires CSLB to give notice to the licensee but provides that the notice contain language explaining that a “pending suspension will be posted to the license record for not more than 45 days prior to the posting of any license suspension periods required under this article.” (Bus. & Prof.

Code, § 7125.2, subds. (a), (b) [emphasis added].) Furthermore, this is the interpretation adopted by the reviewing courts, which draw a distinction between a suspension resulting from the failure to obtain any workers’ compensation coverage at all and suspension following a lapse of coverage:

Under the language of section 7125.2, a contractor whose license is subject to suspension for allowing his or her workers' compensation insurance to lapse is entitled to notice prior to the suspension of his or her license; but a contractor whose license is subject to suspension for failing to obtain workers' compensation insurance is subject to automatic suspension without notice.

(Loranger v. Jones, supra, 184 Cal.App.4th at p. 856, citing Wright v. Issak (2007) 149 Cal.App.4th 1116, 1122 [italics in original; underline added].) This construction is also supported by American Building Innovation LP v. Balfour Beatty Construction, LLC, where the court described the suspension process following cancellation of a contractor’s worker’s compensation insurance as follows: “The Board gave [contractor] notice of the license suspension on January 29 and informed [contractor] that its contractor’s license would be suspended if [contractor] failed to submit a valid insurance certificate or exemption of certificate within 45 days.” (American Building Innovation LP v. Balfour Beatty Construction, LLC (2024) 104 Cal.App.5th 954, 960, italics added.)

Therefore, in the absence of notice from the CSLB pursuant to Section 7125.2, subdivision (b), the lapse or cancellation of a licensed contractor’s worker’s compensation insurance coverage does not in and of itself effect suspension of the contractor’s license.

Given the Court’s interpretation of Section 7125.2 as requiring CSLB to send notice to Defendants prior to any “automatic suspension” occurring, the Court finds that Plaintiffs’ have failed to satisfy their initial burden on their present motion for summary adjudication. As Plaintiffs’ moving papers concede, Plaintiffs have provided no evidence that such notice was given by CSLB. Because Plaintiffs have failed to satisfy their initial burden as to their motion directed to the first cause of action, the burden does not shift to Defendants to raise a triable issue of material fact.

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Therefore, in addition to denial based upon Code of Civil Procedure sections 1008(b) and 437c(f)(2), the Court finds that Plaintiff’s motion for summary adjudication of their first cause of action is denied on this additional ground.

Third Cause of Action – “Breach” of Bus. & Prof. Code, § 7159

Plaintiffs also move for summary adjudication of their third cause of action. There, they allege that the contract signed by Ivan for the remodel project did not comply with the consumer protection requirements provided in Business & Professions Code, section 7159 (Section 7159). (2nd Am. Comp. ¶ 24.) Therefore, they allege, Defendants Ivan and IMKAT are barred from recording any lien against the subject property. (Ibid.)

As discussed above, Plaintiffs’ motion for summary adjudication of their third cause of action is denied for Plaintiffs’ failure to comply with Code of Civil Procedure sections 1008(b) and 437c(f)(2). There is no question that Plaintiffs’ present motion and stated grounds for this cause of action are identical to that set forth in their notice of motion for their prior failed motion summary adjudication. (See Plaintiffs’ Notice of Motion and Motion for Summary Adjudication (prior motion), filed August 1, 2025, at 3:1-3; Plaintiffs’ Notice of Motion and Motion for Summary Adjudication (present motion), filed March 3, 2026, at 2:6-8.).) Again, while the Court need not proceed further, it does so only to note that even if Plaintiffs’ motion as to the third cause of action were not fatally defective, it would be denied in any event.

In the Second Amended Complaint, Plaintiffs seek the following relief in connection with the third cause of action: “[J]udgment that the contract is void and unenforceable and for preliminary and permanent injunctive barring IVAN and/or IMKAT from recording a mechanic's lien against the Property,” as well as attorneys’ fees, costs, and other relief deemed appropriate by the Court. (2nd Am. Compl. 6:16-20.) Plaintiffs present evidence that the contract they signed with IMKAT did not comply with Section 7159 in several respects.

They indicate that the contract did not provide the required notice regarding lien rights (Defs. Resp. to Plfs. UMF 25), the contract was signed by Ivan, who was not a licensed contractor or a licensed salesperson (Defs. Resp. to Plfs. UMF 26), and the contract required a $9000 deposit, which exceeded the amount permitted by Section 7159 (Defs. Resp. to Plfs. UMF 27).

Defendants do not dispute these facts. (Defs. Resp. to Plfs. UMF 25-27.) They concede that the contract “does not strictly conform to § 7159” and concede “Defendants have no defense to this claim, only a mitigating factor: the form was provided to them by [Plaintiffs’] own construction lender.” (Def. Opp. 4:19-21.) However, as Defendants argue, the fact that a contract does not comply with Section 7159 does not, in and of itself, entitle Plaintiffs to relief. It is well settled that a contract that does not comply with Section 7159 is voidable, but not void. (Asdourian v. Araj (1985) 38 Cal.3d 276, 293, superseded on other grounds by statute; see also Hinterfeld- Ward, Inc. v. Lipian (2010) 188 Cal.App.4th 86, 94-95 [noting holding in Asdourian that “a

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contract in violation of section 7159 does not present the type of illegality that automatically renders a contract void”].)

Instead, where a violation of Section 7159 is established, whether or not the contract should be voided as a result of the violation “depend[s] on the factual context and the public policies involved.” (Asdourian v. Araj, supra, 38 Cal.3d at p. 293.) A plaintiff seeking to void a construction contract based on non-compliance with Section 7159 must establish that they “fall within the class of homeowners the Legislature sought to protect in enacting section 7159.” (Hinterfeld-Ward, Inc. v. Lipian, supra, 188 Cal.App.4th at 94.) This analysis involves consideration of various factors, including “the sophistication of the parties in construction matters.” (Ibid; see also Davenport & Co. v. Spieker (1988) 197 Cal.App.3d 566, 570 [contractor’s noncompliance with Section 7159 did not preclude enforcement of contract based on application of principles established in Asdourian].)

Here, Plaintiffs have made no showing that they “fall within the class of homeowners the Legislature sought to protect in enacting section 7159.” (Hinterfeld-Ward, Inc. v. Lipian, supra, 188 Cal.App.4th at 94.) Instead, they assert that the IMKAT contract did not comply with Section 7159 and conclude that “[a]s a result, [Plaintiffs] are entitled to a declaratory judgment that the Contract did not comply with the requirements of [Section 7159].” (Plf. MSA Mem., 9:7-9.) As discussed, however, more is required in order to establish that a contract is void for violation of Section 7159.

The Court must consider “the factual context and the public policies involved” in a determination that a violation of Section 7159 should render a contract void. As the Court noted in its Order denying Plaintiffs’ previous motion for summary adjudication, one such consideration here is the fact that the construction contract at issue was provided by Plaintiffs’ lender and was not prepared or presented by Defendants. (Defs. Resp. to Plfs. SS Add’l UMF 42; Plf. MSA Mem., 9:6-7.) Accordingly, Plaintiffs have not met their initial burden to demonstrate entitlement to any relief under the third cause of action.

Therefore, in addition to denial based upon Code of Civil Procedure sections 1008(b) and 437c(f)(2), the Court finds that Plaintiff’s motion for summary adjudication of their third cause of action is denied on this additional ground.

Disposition

For the reasons set forth above, Plaintiffs’ Motion for Summary Adjudication is denied in its entirety.

The Minute Order is effective immediately. No formal order pursuant to CRC Rule 3.1312 or further notice is required.

[1] To the degree Plaintiffs indicate in their memorandum an intent to seek summary

adjudication of the fourth cause of action, the notice of motion and separate statement

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do not address the fourth cause of action. The instant motion is therefore defective as to the fourth cause of action, and any motion for summary adjudication of the fourth cause of action is denied on this basis. The Court also notes that Plaintiffs’ prior motion for summary adjudication was also made as to the fourth cause of action.