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RICHARD DOYLE, City Attorney (88625)
NORA FRIMANN, Assistant City Attorney (93249)
ARDELL JOHNSON, Chief Deputy City Attorney (95340)
Office of the City Attorney
200 East Santa Clara Street, 16 th Floor
San José, California 95113-1905
Telephone Number: (408) 535-1900
Facsimile Number: (408) 998-3131
E-Mail Address: cao.main@sanjoseca.gov
Attorneys for CITY OF SAN JOSE
SUPERIOR COURT OF CALIFORNIA, COUNTY OF SANTA CLARA
UNLIMITED JURISDICTION
SUTTER'S PLACE, INC. dba BAY 101, a Case Number: 1-14-CV-267311
California corporation, LEAD FILE
Plaintiff, Consolidated with 16CV298883
v. DEFENDANT’S MOTION IN LIMINE
NO. 5 TO EXCLUDE CLAIMS AND
CITY OF SAN JOSE, a California EVIDENCE BARRED BY THE
municipal corporation, and DOES 1-100,
inclusive, STATUTE OF LIMITATIONS
Defendants.
TRIAL: November 27, 2018
TIME: 9:00 a.m.
DEPT: 8
JUDGE: Hon. Sunil R. Kulkarni
NOTICE OF CITY OF SAN JOSE’S MOTION TO EXCLUDE CLAIMS AND
EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS
TO: PLAINTIFF, SUTTER’S PLACE, INC. dba BAY 101, AND ITS ATTORNEY OF
RECORD:
PLEASE TAKE NOTICE that Defendant, City of San Jose, hereby moves the Court
for an order excluding any and all evidence, references to evidence, testimony or argument
relating to attorney fees and other expenditures incurred by Plaintiff, Sutter’s Place, Inc.
dba Bay 101, in support of or in connection with any and all litigation against the City. This
DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311
EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS
1575328
1 motion is based on the ground that such evidence is irrelevant and immaterial to the issues
2 in this action and, therefore, inadmissible. The motion is supported by the accompanying
3 memorandum of points and authorities, declarations by Ardell Johnson and Nora Frimann,
4 the pleadings and papers on file in this action, and on such oral or documentary evidence
5 as may be presented prior to or at the hearing of this matter.
6 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF IN LIMINE
7 MOTION TO EXCLUDE CLAIMS AND EVIDENCE BARRED BY THE STATUTE
OF LIMITATIONS.
8
A. INTRODUCTION
9
10 This motion seeks an order barring Bay 101 from presenting claims and offering
11 evidence relating to claims barred by the statute of limitations set forth in California
12 Government Code § 911.2, which required Bay 101 to file a claim for breach of contract
13 within one year of the alleged breach. In this case, Bay 101 first asserted the City
14 breached the Settlement Agreement in 2010; but did not submit a government claim for
15 the alleged breach of the Settlement Agreement until January 26, 2016. Defendant
16 contends the applicable statute of limitations set forth in section 911.2 bars Bay 101’s
17 claims.
18 The motion also seeks to preclude Bay 101 from offering evidence relating to its
19 claims for declaratory and injunctive relief, and argument that it is entitled to any equitable
20 remedy, on the grounds that all such claims for equitable relief are barred by California
21 Code of Civil Procedure § 377 and the doctrine of laches.
22 B. STATEMENT OF FACTS RELEVANT TO MOTION
23 Plaintiff, Sutter’s Place, Inc. dba Bay 101, owns one of two cardrooms allowed to
24 operate a gambling business in San Jose. Plaintiff entered into a Settlement Agreement
25 with the City of San Jose on, or about, March 12, 2009. That agreement resolved three
26 lawsuits Plaintiff had filed challenging the City’s gaming regulations and the legality of
27 regulatory fees the City had charged Bay 101. The material terms involved modifications
28 to the City’s gaming regulations, the removal of regulatory constraints on Bay 101’s
2
DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311
EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS
1575328
1 gaming operations and dismissal of the lawsuits, although Bay 101 reserved the right to
2 sue the City again over future regulatory fees. The Settlement Agreement also contained
3 the following vague sentence, which is the sole basis for Plaintiff’s breach of contract claim
4 seeking damages in this lawsuit:
5
The City agrees that it will provide an annual accounting of table fees in
6 sufficient detail to allow Bay 101 to determine the use of all amounts paid as
table fees.
7
8 Plaintiff submitted a letter, dated January 28, 2010, seeking an accounting for the
9 use of table fees paid in fiscal year 2008-2009. After the City responded with information
10 identifying the amounts expended for personnel and non-personnel costs, Plaintiff
11 complained in a letter dated June 16, 2010, that the information the City provided “does
12 not comply with the parties’ settlement agreement executed in March 2009.” Bay 101 did
13 not file a complaint for breach of contract seeking declaratory and injunctive relief until
14 June 30, 2014. Bay 101 did not make a claim for damages until January 26, 2016, when it
15 submitted a government claim for damages allegedly arising from the same breach
16 alleged in its June 30, 2014 complaint.
17
C. ARGUMENT
18
1. Bay 101’s Cause of Action for Breach of Contract Accrued No Later Than
19 June 16, 2010.
20 A cause of action based upon a breach of contract accrues at the time of the breach.
21 E.O.C. Ord, Inc. v. Kovakovich (1988) 200 Cal. App. 3d 1194, 1203, citing Niles v. Louis H.
22 Rapoport & Sons (1942) 53 Cal.App.2d 644, 651 [“The statute of limitations does not begin
23 to run from the time of making a contract, but commences from the time the cause of action
24 accrues.”]. In this case, Bay 101 has only one cause of action for breach of contract. It
25 accrued no later than June 16, 2010 because Bay 101 wrote a letter to the City on that date
26 accusing the City of breaching the Settlement Agreement. Bay 101 did not file its complaint
27 for declaratory relief until June 30, 2014, fourteen days beyond the four-year statute of
28 limitations set forth in Code of Civil Procedure § 337 governing claims for breach of a written
3
DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311
EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS
1575328
1 contract. Therefore, Bay 101’s claims for equitable relief are all barred. See Mangini v.
2 Aerojet-General Corp. (1991) 230 Cal.App.3d 1125, 1155 [“The statute of limitations
3 governing a request for declaratory relief is the one applicable to an ordinary legal or
4 equitable action based on the same claim.”]; and, Maguire v. Hibernia S. & L. Soc. (1944) 23
5 Cal.2d 719, 733 [“Thus, if declaratory relief is sought with reference to an obligation which
6 has been breached and the right to commence an action for ‘coercive’ relief upon the cause
7 of action, arising therefrom is barred by the statute, the right to declaratory relief is likewise
8 barred.].
9 Bay 101 cannot rely on the discovery rule to argue its cause of action accrued at a
10 later date. That rule applies where a breach of contract occurs in the context of a fiduciary
11 relationship. See April Enterprises, Inc. v. KTTV (1983) 147 Cal. App. 3d 805, 827 [“It is
12 well-settled that the discovery rule applies to causes of action involving the breach of a
13 fiduciary relationship.”]. The City has regulatory authority over Bay 101. That is not a
14 fiduciary relationship. Regardless, even under the discovery rule, a cause of action accrues
15 when the plaintiff discovers or should have discovered all facts essential to his cause of
16 action. Id. Here, Bay 101’s June 16, 2010 letter establishes it believed the City provided
17 information that “does not comply with,” in other words, breached the agreement. Even if the
18 discovery rule applied, June 16, 2010 still is the date Bay 101’s cause of action accrued.
19 The doctrine of laches also applies to bar Bay 101’s June 30, 2014 complaint for
20 injunctive and declaratory relief. Laches is an equitable defense based on the principle that
21 those who neglect their rights may be barred from obtaining relief in equity. The defense
22 requires unreasonable delay plus either acquiescence in the act about which the plaintiff
23 complains or prejudice to the defendant resulting from the delay. The trial court may rule on
24 the defense of laches as a matter of law where the relevant facts are undisputed, otherwise it
25 is a question of fact for the court to decide. Clary v. City of Crescent City (2017) 11
26 Cal.App.5th 274, 286.
27 Here, Bay 101’s cause of action accrued no later than June 16, 2010, when it
28 asserted the City had breached the contract. Nevertheless, Bay 101 failed to act on its
4
DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311
EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS
1575328
1 claim, thereby acquiescing in the City’s interpretation of the contract for more than four years
2 before filing suit to have a court issue a declaration interpreting the contract and/or enjoin the
3 City from performing it based on the City’s interpretation of the contract. These are the
4 relevant facts and they warrant applying the doctrine of laches to bar Bay 101’s equitable
5 claims.
6 2. The Statute of Limitations Bars Bay 101 From Recovering Damages For
7 Which Bay 101 Failed to Submit a Timely Government Claim.
8 California Government Code § 911.2 required Bay 101 to file a claim for damages
9 arising from the alleged breach of contract within one year of the alleged breach. Therefore,
10 all evidence relating to any conduct, claimed breach, or damage arising before January 26,
11 2015 is irrelevant and should be excluded under Evidence Code sections 350 and 352
12 because all such claims are barred by the applicable statute of limitations.
13
D. CONCLUSION
14
15 For the foregoing reasons, Defendant requests the Court grant this motion and
16 issue an in limine order precluding Plaintiffs from introducing evidence, testimony or
17 argument relating to claims barred by the applicable statutes of limitation.
18
19 Respectfully submitted,
20
Dated: November 21, 2018 RICHARD DOYLE, City Attorney
21
22
By: __/s/ Ardell Johnson_______________
23 ARDELL JOHNSON
Chief Deputy City Attorney
24
Attorneys for Defendant City of San Jose
25
26
27
28
5
DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311
EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS
1575328
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RICHARD DOYLE, City Attorney (88625) NORA FRIMANN, Assistant City Attorney (93249) ARDELL JOHNSON, Chief Deputy City Attorney (95340) Office of the City Attorney 200 East Santa Clara Street, 16 th Floor San José, California 95113-1905 Telephone Number: (408) 535-1900 Facsimile Number: (408) 998-3131 E-Mail Address: cao.main@sanjoseca.gov Attorneys for CITY OF SAN JOSE SUPERIOR COURT OF CALIFORNIA, COUNTY OF SANTA CLARA UNLIMITED JURISDICTION SUTTER'S PLACE, INC. dba BAY 101, a Case Number: 1-14-CV-267311 California corporation, LEAD FILE Plaintiff, Consolidated with 16CV298883 v. DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND CITY OF SAN JOSE, a California EVIDENCE BARRED BY THE municipal corporation, and DOES 1-100, inclusive, STATUTE OF LIMITATIONS Defendants. TRIAL: November 27, 2018 TIME: 9:00 a.m. DEPT: 8 JUDGE: Hon. Sunil R. Kulkarni NOTICE OF CITY OF SAN JOSE’S MOTION TO EXCLUDE CLAIMS AND EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS TO: PLAINTIFF, SUTTER’S PLACE, INC. dba BAY 101, AND ITS ATTORNEY OF RECORD: PLEASE TAKE NOTICE that Defendant, City of San Jose, hereby moves the Court for an order excluding any and all evidence, references to evidence, testimony or argument relating to attorney fees and other expenditures incurred by Plaintiff, Sutter’s Place, Inc. dba Bay 101, in support of or in connection with any and all litigation against the City. This DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311 EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS 1575328 1 motion is based on the ground that such evidence is irrelevant and immaterial to the issues 2 in this action and, therefore, inadmissible. The motion is supported by the accompanying 3 memorandum of points and authorities, declarations by Ardell Johnson and Nora Frimann, 4 the pleadings and papers on file in this action, and on such oral or documentary evidence 5 as may be presented prior to or at the hearing of this matter. 6 MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF IN LIMINE 7 MOTION TO EXCLUDE CLAIMS AND EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS. 8 A. INTRODUCTION 9 10 This motion seeks an order barring Bay 101 from presenting claims and offering 11 evidence relating to claims barred by the statute of limitations set forth in California 12 Government Code § 911.2, which required Bay 101 to file a claim for breach of contract 13 within one year of the alleged breach. In this case, Bay 101 first asserted the City 14 breached the Settlement Agreement in 2010; but did not submit a government claim for 15 the alleged breach of the Settlement Agreement until January 26, 2016. Defendant 16 contends the applicable statute of limitations set forth in section 911.2 bars Bay 101’s 17 claims. 18 The motion also seeks to preclude Bay 101 from offering evidence relating to its 19 claims for declaratory and injunctive relief, and argument that it is entitled to any equitable 20 remedy, on the grounds that all such claims for equitable relief are barred by California 21 Code of Civil Procedure § 377 and the doctrine of laches. 22 B. STATEMENT OF FACTS RELEVANT TO MOTION 23 Plaintiff, Sutter’s Place, Inc. dba Bay 101, owns one of two cardrooms allowed to 24 operate a gambling business in San Jose. Plaintiff entered into a Settlement Agreement 25 with the City of San Jose on, or about, March 12, 2009. That agreement resolved three 26 lawsuits Plaintiff had filed challenging the City’s gaming regulations and the legality of 27 regulatory fees the City had charged Bay 101. The material terms involved modifications 28 to the City’s gaming regulations, the removal of regulatory constraints on Bay 101’s 2 DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311 EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS 1575328 1 gaming operations and dismissal of the lawsuits, although Bay 101 reserved the right to 2 sue the City again over future regulatory fees. The Settlement Agreement also contained 3 the following vague sentence, which is the sole basis for Plaintiff’s breach of contract claim 4 seeking damages in this lawsuit: 5 The City agrees that it will provide an annual accounting of table fees in 6 sufficient detail to allow Bay 101 to determine the use of all amounts paid as table fees. 7 8 Plaintiff submitted a letter, dated January 28, 2010, seeking an accounting for the 9 use of table fees paid in fiscal year 2008-2009. After the City responded with information 10 identifying the amounts expended for personnel and non-personnel costs, Plaintiff 11 complained in a letter dated June 16, 2010, that the information the City provided “does 12 not comply with the parties’ settlement agreement executed in March 2009.” Bay 101 did 13 not file a complaint for breach of contract seeking declaratory and injunctive relief until 14 June 30, 2014. Bay 101 did not make a claim for damages until January 26, 2016, when it 15 submitted a government claim for damages allegedly arising from the same breach 16 alleged in its June 30, 2014 complaint. 17 C. ARGUMENT 18 1. Bay 101’s Cause of Action for Breach of Contract Accrued No Later Than 19 June 16, 2010. 20 A cause of action based upon a breach of contract accrues at the time of the breach. 21 E.O.C. Ord, Inc. v. Kovakovich (1988) 200 Cal. App. 3d 1194, 1203, citing Niles v. Louis H. 22 Rapoport & Sons (1942) 53 Cal.App.2d 644, 651 [“The statute of limitations does not begin 23 to run from the time of making a contract, but commences from the time the cause of action 24 accrues.”]. In this case, Bay 101 has only one cause of action for breach of contract. It 25 accrued no later than June 16, 2010 because Bay 101 wrote a letter to the City on that date 26 accusing the City of breaching the Settlement Agreement. Bay 101 did not file its complaint 27 for declaratory relief until June 30, 2014, fourteen days beyond the four-year statute of 28 limitations set forth in Code of Civil Procedure § 337 governing claims for breach of a written 3 DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311 EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS 1575328 1 contract. Therefore, Bay 101’s claims for equitable relief are all barred. See Mangini v. 2 Aerojet-General Corp. (1991) 230 Cal.App.3d 1125, 1155 [“The statute of limitations 3 governing a request for declaratory relief is the one applicable to an ordinary legal or 4 equitable action based on the same claim.”]; and, Maguire v. Hibernia S. & L. Soc. (1944) 23 5 Cal.2d 719, 733 [“Thus, if declaratory relief is sought with reference to an obligation which 6 has been breached and the right to commence an action for ‘coercive’ relief upon the cause 7 of action, arising therefrom is barred by the statute, the right to declaratory relief is likewise 8 barred.]. 9 Bay 101 cannot rely on the discovery rule to argue its cause of action accrued at a 10 later date. That rule applies where a breach of contract occurs in the context of a fiduciary 11 relationship. See April Enterprises, Inc. v. KTTV (1983) 147 Cal. App. 3d 805, 827 [“It is 12 well-settled that the discovery rule applies to causes of action involving the breach of a 13 fiduciary relationship.”]. The City has regulatory authority over Bay 101. That is not a 14 fiduciary relationship. Regardless, even under the discovery rule, a cause of action accrues 15 when the plaintiff discovers or should have discovered all facts essential to his cause of 16 action. Id. Here, Bay 101’s June 16, 2010 letter establishes it believed the City provided 17 information that “does not comply with,” in other words, breached the agreement. Even if the 18 discovery rule applied, June 16, 2010 still is the date Bay 101’s cause of action accrued. 19 The doctrine of laches also applies to bar Bay 101’s June 30, 2014 complaint for 20 injunctive and declaratory relief. Laches is an equitable defense based on the principle that 21 those who neglect their rights may be barred from obtaining relief in equity. The defense 22 requires unreasonable delay plus either acquiescence in the act about which the plaintiff 23 complains or prejudice to the defendant resulting from the delay. The trial court may rule on 24 the defense of laches as a matter of law where the relevant facts are undisputed, otherwise it 25 is a question of fact for the court to decide. Clary v. City of Crescent City (2017) 11 26 Cal.App.5th 274, 286. 27 Here, Bay 101’s cause of action accrued no later than June 16, 2010, when it 28 asserted the City had breached the contract. Nevertheless, Bay 101 failed to act on its 4 DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311 EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS 1575328 1 claim, thereby acquiescing in the City’s interpretation of the contract for more than four years 2 before filing suit to have a court issue a declaration interpreting the contract and/or enjoin the 3 City from performing it based on the City’s interpretation of the contract. These are the 4 relevant facts and they warrant applying the doctrine of laches to bar Bay 101’s equitable 5 claims. 6 2. The Statute of Limitations Bars Bay 101 From Recovering Damages For 7 Which Bay 101 Failed to Submit a Timely Government Claim. 8 California Government Code § 911.2 required Bay 101 to file a claim for damages 9 arising from the alleged breach of contract within one year of the alleged breach. Therefore, 10 all evidence relating to any conduct, claimed breach, or damage arising before January 26, 11 2015 is irrelevant and should be excluded under Evidence Code sections 350 and 352 12 because all such claims are barred by the applicable statute of limitations. 13 D. CONCLUSION 14 15 For the foregoing reasons, Defendant requests the Court grant this motion and 16 issue an in limine order precluding Plaintiffs from introducing evidence, testimony or 17 argument relating to claims barred by the applicable statutes of limitation. 18 19 Respectfully submitted, 20 Dated: November 21, 2018 RICHARD DOYLE, City Attorney 21 22 By: __/s/ Ardell Johnson_______________ 23 ARDELL JOHNSON Chief Deputy City Attorney 24 Attorneys for Defendant City of San Jose 25 26 27 28 5 DEFENDANT’S MOTION IN LIMINE NO. 5 TO EXCLUDE CLAIMS AND 1-14-CV-267311 EVIDENCE BARRED BY THE STATUTE OF LIMITATIONS 1575328