Grove Way Investments, LLC v. Centene Management Company, LLC ( 2020 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 GROVE WAY INVESTMENTS, LLC, No. 2:19-cv-00696-JAM-JDP 12 Plaintiff, 13 v. ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF’S 14 CENTENE MANAGEMENT COMPANY, MOTION FOR PARTIAL SUMMARY LLC, JUDGMENT AND DENYING DEFENDANT’S 15 MOTION FOR SUMMARY JUDGMENT Defendant. 16 17 Grove Way Investments, LLC (“Grove Way” or “Plaintiff”) 18 filed suit against its tenant, Centene Management Company, LLC 19 (“Centene” or “Defendant”) for declaratory relief and breach of 20 contract. See Compl., ECF No. 1. Centene filed counterclaims 21 against Grove Way for breach of contract, breach of the covenant 22 of good faith and fair dealing, breach of the implied duty to 23 perform with reasonable care, quantum meruit/unjust enrichment, 24 declaratory relief and accounting. See Answer and Countercl. 25 ¶¶ 22-59, ECF No. 5. The parties filed cross-motions for partial 26 summary judgment. See Pl.’s Mot. Summ. J. (“Pl.’s Mot.”), ECF 27 No. 51; Def.’s Mot. Summ. J. (“Def.’s Mot.”), ECF No. 56. Each 28 1 side has opposed the other and replied. See Pl.’s Opp’n, ECF No. 2 62; Def.’s Mot.; Def.’s Reply, ECF No. 67. 3 For the reasons set forth below, the Court GRANTS in part 4 and DENIES in part Plaintiff’s motion for partial summary 5 judgment and DENIES Defendant’s motion for partial summary 6 judgment.1 7 8 I. FACTUAL ALLEGATIONS AND PROCEDURAL BACKGROUND 9 On or around January 24, 2017, RF3 International Drive, LLC 10 (“RF3”) and Centene entered into a Single Tenant Office Lease 11 Agreement (“Original Lease”) for an office building in Rancho 12 Cordova (“the Property”). Pl.’s Resp. to Def.’s Undisputed Facts 13 (“Def.’s SUF”) No. 1, ECF No. 62. In addition to the original 14 lease, a Construction Rider provided that if certain conditions 15 were met, the tenant, Centene, would be provided a one-time 16 payment of up to $1,857,210.80 (“the Allowances”), reimbursing 17 them for the costs of improvements made to the property. Def.’s 18 Resp. to Pl.’s Undisputed Facts (“Pl.’s SUF”) No. 6-7, ECF No. 19 56; Def.’s SUF No. 2-3. 20 On June 23, 2017, Grove Way purchased the property and RF3 21 assigned to Grove Way all of its rights and obligations under the 22 original lease, including the obligation to pay the allowances. 23 Pl.’s SUF No. 1-2; Def.’s SUF No. 13, 15. In October, 2017, 24 Grove Way and Centene amended the lease which among other things, 25 revised Section 2.2 of the Construction Rider, extending the 26 27 1 This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was 28 scheduled for September 29, 2020. 1 deadline Centene was required to “submit a request for 2 application or disbursement of the entire Allowances, or of its 3 election to apply up to $5 per square foot against Rent” from 4 December 31, 2017 to June 30, 2018. Pl.’s SUF No. 4; Def.’s SUF 5 No. 18. 6 On January 25, 2018 Grove Way approved Centene’s construction 7 plans, conditioned on Centene reimbursing Grove Way for the cost 8 of review, paying an additional oversight fee equal to 1% of the 9 total construction costs and paying to replace a security system 10 that had been removed during demolition. Pl.’s SUF No. 19; 11 Def.’s SUF No. 23-26. Centene agreed to the conditions shortly 12 thereafter. Pl.’s SUF No. 19; Def.’s SUF No. 27. 13 On April 5, 2018, Centene provided Grove Way with revised 14 tenant plans reflecting the removal of the kitchen, gym, related 15 bathrooms and generator. Pl.’s SUF No. 25-26; Def.’s SUF No. 28. 16 On June 30, 2018, Grove Way sent an approval of the updated plans 17 that was conditioned on Centene paying for a security system, an 18 upgraded temperature control system and additional smoke 19 detectors. Pl.’s SUF No. 34-35; Def.’s SUF No. 29-30, 41, 46. 20 Centene paid to have the temperature control system upgraded but 21 was not agreeable to paying for the security system, as Centene 22 contends it was substantially more expensive than the one that 23 had been removed and that it had previously agreed to pay for in 24 January. Def.’s SUF No. 30, 33, 45. The fire detectors were not 25 installed as set forth in the conditions for reasons which are 26 disputed. See Def.’s SUF No. 45-56. 27 On June 22, 2018 Centene submitted to Grove Way a written 28 request for application of the entire allowances but acknowledged 1 that disbursement would not be made until it had satisfied all 2 the conditions laid out in Section 2.4 of the Construction Rider. 3 Pl.’s SUF No. 32; Def.’s SUF No. 64. On February 7, 2019 Centene 4 submitted a letter entitled “Disbursement of Allowances” to Grove 5 Way, as well as a binder of materials, purportedly to comply with 6 Section 2.4. Def.’s SUF No. 66-67. The parties dispute whether 7 the items sent met all of the conditions. See Pl.’s Mot. at 16- 8 19; Def.’s Mot. at 18-29. In total Centene paid over three 9 million dollars to improve the premise. See Def.’s SUF No. 79- 10 80. Grove Way has not paid Centene any portion of the 11 allowances. Def.’s SUF No. 92. Grove Way invoiced Centene for 12 the security system, which Centene did not pay. See Pl.’s SUF 13 No. 50D. 14 Grove Way then brought this action against Centene in 15 Sacramento Superior Court for declaratory relief and breach of 16 contract. See generally Compl. Centene removed the case to 17 federal court based on diversity jurisdiction. Notice of Removal 18 at 1, ECF No. 1. Centene brought counterclaims against Grove Way 19 for breach of contract, breach of the covenant of good faith and 20 fair dealing, breach of the implied duty to perform with 21 reasonable care, quantum meruit/unjust enrichment, declaratory 22 relief and accounting. See generally Def.’s Answer and 23 Countercl. Grove Way moved for partial summary judgment on 24 Centene’s breach of contract, breach of the covenant of good 25 faith and fair dealing, quantum meruit/unjust enrichment and 26 accounting counterclaims. See generally Pl.’s Mot. Centene 27 filed a cross motion for partial summary judgment on its breach 28 of contract, quantum meruit/unjust enrichment and declaratory 1 relief counterclaims, as well as Grove Way’s first cause of 2 action for declaratory relief. See generally Def.’s Mot. 3 4 II. OPINION 5 A. Evidentiary Objections 6 Plaintiff and Defendant raise several evidentiary 7 objections. See Pl.’s Obj., ECF No. 63, 70; Def.’s Obj., ECF 8 No. 62. The Court has reviewed these evidentiary objections but 9 declines to rule on each one individually as courts self-police 10 evidentiary issues on motions for summary judgment and a formal 11 ruling is unnecessary to the determination of this motion. See 12 Burch v. Regents of the University of California, 433 F.Supp.2d 13 1110, 1118-1122 (E.D. Cal. 2006) (objections challenging the 14 characterization of the evidence are improper on a motion for 15 summary judgment). 16 B. Legal Standard 17 A Court must grant a party’s motion for summary judgment 18 “if the movant shows that there is no genuine dispute as to any 19 material fact and the movant is entitled to a judgment as a 20 matter of law.” Fed. R. Civ. Proc. 56(a). The movant bears the 21 initial burden of “informing the district court of the basis for 22 its motion, and identifying [the documents] which it believes 23 demonstrate the absence of a genuine issue of a material fact.” 24 Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). A fact is 25 material if it “might affect the outcome of the suit under the 26 governing law.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 27 248 (1986). Once the movant makes this initial showing, the 28 burden rests upon the nonmoving party to “set forth specific 1 facts showing that there is a genuine issue for trial.” Id. An 2 issue of fact is genuine if “the evidence is such that a 3 reasonable jury could return a verdict for the nonmoving party.” 4 Id. 5 C. Analysis 6 1. Breach of Contract 7 In order to prevail on its breach of contract claim Centene 8 must prove: (1) the existence of a contract, (2) Centene’s 9 performance of the contract or excuse for nonperformance, (3) 10 Grove Way’s breach, and (4) resulting damages. See Richman v. 11 Hartley, 169 Cal. Rptr. 3d 475, 478 (Ct. App. 2014). 12 Both parties have sought summary judgment on Centene’s 13 first counterclaim for breach of contract. See Pl.’s Mot. at 14 15; Def.’s Mot. at 18. The existence of a contract is not 15 contended. See Pl.’s Mot. at 15-19; Def.’s Mot. at 18-30. In 16 dispute, however, is whether Centene has satisfied all 17 conditions, triggering Grove Way’s obligation to pay the 18 allowances. See Pl.’s Mot. at 16-19; Def.’s Mot. at 18-30. 19 Centene claims that all conditions have been met or excused, 20 such that Grove Way breached by failing to pay the allowances. 21 See Def.’s Mot. at 18-30; see also Def.’s Answer and Countercl. 22 at 10-11. Grove Way on the other hand, contends it was not 23 obligated to pay, as not all the required conditions have been 24 met. See Pl.’s Mot. at 16-19. 25 A. Section 2.2 and the June 30, 2018 Deadline 26 The first contention is over the interpretation of Section 27 2.2 of the Construction Rider. The pertinent portion states: 28 1 If Tenant does not submit a request for application or disbursement of the entire Allowances, or of its election 2 to apply up to $5 per square foot against Rent, as described in the preceding sentences, in accordance with 3 this Section 2.2 by June 30, 2018, any unused portion of 4 the Allowances shall be forfeited and shall accrue for the sole benefit of Landlord. 5 6 The language of a contract is to govern its interpretation, 7 if the language is clear and explicit, and does not involve an 8 absurdity. Cal. Civ. Code § 1638. When a contract is reduced 9 to a writing, the intention of the parties is to be ascertained 10 from the writing alone if possible. Id. at § 1639. However, 11 under California law, extrinsic evidence is admissible if it is 12 relevant to prove a meaning to which the language is reasonably 13 susceptible. Pac. Gas & Elec. Co. v. G.W. Thomas Drayage & 14 Rigging Co., 442 P.2d 641, 644 (Cal. 1968). 15 Grove Way argues that under 2.2, Centene was required to 16 both complete construction of the improvements and submit all 17 the necessary paperwork required of Section 2.4 to Grove Way by 18 June 30, 2018 in order to receive the allowances. Pl.’s Mot. at 19 2. Grove Way argues that the language in Section 2.2 referring 20 to tenant’s “request for application” refers to tenant’s request 21 to apply the $5.00 per rentable square foot credit to its rent, 22 not a request for the improvement allowances. Pl.’s Opp’n at 23 12. Centene on the other hand, argues it was only required to 24 submit a request for application of the allowances to Grove Way 25 by the June 30, 2018 deadline, which it met when it submitted a 26 written request for application before such date. Def.’s Mot. 27 at 19. Centene contends Section 2.2 did not require it to 28 complete construction or all the conditions of 2.4 by then in 1 order to receive the allowance. Id. 2 The plain reading of the contract supports Centene’s 3 position. The Court reads the statement “request for 4 application or disbursement of the entire Allowances” to mean 5 that Centene was able to meet this requirement by notifying 6 Grove Way of its intent to use the full allowances by the 7 deadline. The explicit terms do not mention meeting all the 8 conditions set forth in 2.4 or completing construction by the 9 June 30, 2018 date. However, under California law, the test of 10 whether parol evidence is admissible to construe an ambiguity is 11 not whether the language appears to the court to be unambiguous, 12 but whether the evidence presented is relevant to prove a 13 meaning to which the language is reasonably susceptible. Winet 14 v. Price, 6 Cal. Rptr. 2d 554, 557 (Ct. App. 1992). Grove Way 15 has introduced numerous exhibits it contends show that its 16 interpretation was the true intent of the parties. See Pl.’s 17 Opp’n 2-4. The Court has considered these but finds they are 18 not relevant to prove a meaning to which the language is 19 reasonably susceptible, as they are also consistent with the 20 plain language meaning. See Def.’s Mot. at 5 (noting the 21 evidence is consistent with Centene wanting to spend the entire 22 allowance by the deadline so no portion would be unused and in 23 order to submit the request in good faith). Even if the 24 contract was reasonably susceptible to Grove Way’s 25 interpretation, that Centene had to complete construction and 26 the conditions of 2.4 by the deadline, Centene would still have 27 not forfeited their right to allowances. Section 2.2 28 specifically states that if the tenant did not submit a request 1 for application or disbursement by the deadline, “any unused 2 portion of the Allowances” would be forfeited. See Pl.’s SUF 3 No. 6; Def.’s SUF No. 2 (emphasis added). By the time the 4 deadline passed, Centene had already completed tenant 5 improvements in excess of the allowance. Def.’s SUF No. 65. As 6 such, no portion of the allowance was unused and forfeited. 7 B. Landlord Approval 8 Grove Way also argues that under Section 6.0 of the Lease 9 and Section 3.2 and 3.4 of the Construction Rider, Centene was 10 required to obtain Grove Way’s approval of the improvements, 11 which it did not. Pl.’s Mot. at 18. But as Centene notes, this 12 was not one of the condition precedents laid out in Section 2.4 13 to receiving disbursement of the allowance. See Def.’s Mot. at 14 26; Pl.’s SUF No. 7; Def.’s SUF No. 4. In order then, to excuse 15 Grove Way’s performance this would have to constitute a material 16 breach. See Brown v. Grimes, 192 Cal. App. 4th 265, 277 17 (2011)(“When a party’s failure to perform a contractual 18 obligation constitutes a material breach of the contract, the 19 other party may be discharged from its duty to perform under the 20 contract). At this point the Court cannot find as a matter of 21 law that this does or does not constitute a material breach as 22 there are too many genuine disputes of material fact. See Pl.’s 23 Mot. at 18-19; Def.’s Mot. 26-29. As such, neither party is 24 entitled to summary judgment. 25 C. Conditions of 2.4 26 Additionally, Grove Way argues that Centene failed to meet 27 several of the conditions to disbursement required of Section 28 2.4 of the Construction Rider. That provision states: 1 2.4 Conditions to Disbursement. No disbursement of the 2 Allowances shall be made unless and until Tenant shall have performed and/or submitted to Landlord all of the 3 following: 4 (a) A factually accurate Commencement Date Memorandum pursuant to Section 2.4 of the Lease demonstrating that the 5 Rent Commencement Date shall have occurred; (b) Certificates of insurance showing that the 6 insurance required of Tenant under Section 11.1 of the Lease is in place and fully effective; 7 (c) Request for Taxpayer Identification Number and 8 Certification (IRS Form W-9) signed and dated by Tenant; (d) An unconditional lien waiver and release from each 9 construction contractor and subcontractor covering the full amount of the Tenant Improvements; 10 (e) Copies of all licenses, permits and approvals required for the Tenant Improvements; 11 (f) Original paid invoices for the work performed; 12 (g) Tenant has delivered to Landlord “as built” plans for the Tenant Improvements 13 (h) Tenant’s architect certifies to Landlord that the Tenant Improvements comply with all Laws, all Permits (as 14 defined below) and the Final Plans (as defined below); (i) Certificate of Occupancy (or its equivalent) have 15 been issued for the Premises; and (j) No mechanic’s liens have been recorded against the 16 Premises or any portion thereof. 17 18 Grove Way first claims Centene failed to meet condition 19 2.4(e) because Centene did not submit approvals from the 20 landlord. Pl.’s Mot. at 17-18. Centene argues that it was not 21 required to do so as “approvals” in 2.4(e) refers to approvals 22 by the relevant governing authorities, not landlord approvals. 23 Def.’s Mot at 24-25. The Court agrees with Centene. As Centene 24 points out, Grove Way is the landlord. It would make little 25 sense for the provision to require the tenant to submit the 26 landlord’s own approvals back to the landlord. Id.; see County 27 of Marin v. Assessment Appeals Bd.,134, Cal. Rptr. 349, 352 (Ct. 28 App. 1976)(“The court shall avoid an interpretation which will 1 make a contract extraordinary, harsh, unjust, inequitable or 2 which would result in absurdity.”) Because Centene sent copies 3 of all licenses, permits and approvals from the relevant 4 authorities, the Court finds Centene has met this condition. 5 Def.’s SUF No. 72. 6 Grove Way also contends that Centene did not satisfy 2.4(g) 7 because although Grove Way received the “as built” plans they 8 were in electronic rather than hard copy form. Pl.’s Mot. at 9 18. Grove Way points out that under Section 22.1 of the lease 10 “any notice, demand, or request, consent or approval that either 11 party desires or is required to give the other Party under this 12 Lease shall be in writing.” Id. While Centene sent its 13 February 7, 2019 request for disbursement in writing and in full 14 compliance with 22.1, as well as a disbursement binder, it did 15 not include hard copies of the voluminous as built plans. Pl.’s 16 SUF No. 43; Def.’s SUF No. 74. Instead, Centene sent these 17 records electronically. Id. The Court finds Centene satisfied 18 this condition. The as built plans were not required to be 19 delivered in hard copy under 22.1 as they are not a notice, 20 demand, request, consent or approval. Centene complied with 21 22.1 by mailing a written request for disbursement and satisfied 22 2.4(g) when it sent Grove Way, electronically, a copy of the as 23 built plans. Id. 24 The parties also dispute whether 2.4(h) has been satisfied. 25 Grove Way argues that the tenant’s architect didn’t certify the 26 tenant improvements complied with the final plans approved by 27 Grove Way. Pl.’s Opp’n at 8. Centene contends this condition 28 was excused because Grove Way unreasonably withheld and delayed 1 its approval in violation of Section 6.1 of the Lease.2 See 2 Jacobs v. Tenneco W., Inc., 231 Cal. Rptr. 351, 353 (Ct. App. 3 1986) (“Where a party’s breach by non-performance contributes 4 materially to the non-occurrence of a condition of one of his 5 duties, the non-occurrence is excused.”) Under Section 6.1 6 Grove Way was only able to withhold its consent if the Tenant 7 Improvements would adversely affect the structure or safety of 8 the Building, otherwise, the Lease provided that Grove Way would 9 not unreasonably withhold or delay its consent to the proposed 10 alterations. Pl.’s SUF No. 10; Def.’s SUF No. 19. Grove Way 11 conditioned its June 30, 2018 approval on having additional 12 smoke detectors installed. Pl.’s SUF No. 34-25; Def.’s SUF No. 13 46. Because there is a genuine dispute as to whether these 14 smoke detectors affected the safety of the building, the Court 15 cannot determine as a matter of law whether or not Grove Way’s 16 withholding of approval was reasonable. Def.’s SUF No. 47-57. 17 Also relevant is the parties’ dispute over whose fault it was 18 that the smoke detectors were not installed. Def.’s SUF No. 53. 19 Centene claims Grove Way is at fault for not signing the 20 proposal or sending the necessary letter to the Fire Department. 21 See id. Grove Way, on the other hand, contends it did not 22 2 Grove Way claims this argument is barred by Section 29.1 of the 23 Lease which states: “[i]f it is determined that Landlord failed to give consent where it was required to do so under this Lease, 24 Tenant shall be entitled to injunctive relief but shall not be entitled to monetary damages.” Pl.’s Mot. at 19. But Centene is 25 not seeking monetary relief based on Grove Way’s failure to give consent. See Def.’s Mot. at 26-29. Instead, Centene is seeking 26 monetary relief based on Grove Way’s failure to pay the 27 allowances. Id. This argument regarding the unreasonable withholding of consent supports Centene’s position that certain 28 conditions were excused, which is not barred by 29.1. 1 follow through with the necessary requirements because Centene 2 would not pay for it. Id. Accordingly, the Court cannot find 3 as a matter of law that this condition was or was not excused. 4 Finally, Grove Way argues that Centene failed to meet 5 condition 2.4(b) requiring Centene to submit certificates of the 6 insurance required under Section 11.1. Pl.’s Opp’n at 7-8. The 7 parties’ statement of facts indicates a dispute over whether the 8 insurance certificates Centene sent met all the requirements of 9 Section 11.1. See Def.’s SUF No. 69. However, the parties do 10 not fully address in their briefing why the items sent do or do 11 not comply with the extensive list of requirements laid out in 12 11.1, which from its own review cannot readily be determined by 13 the Court. See Pl.’s Opp’n at 7; Def.’s Mot. at 24-26; Def.’s 14 Reply at 9. As such, the Court does not find either party has 15 met its burden of showing as a matter of law that this condition 16 has or has not been met. 17 D. Conclusion 18 For the foregoing reasons Grove Way’s motion and Centene’s 19 cross motion for partial summary judgment on Centene’s breach of 20 contract counterclaim are DENIED. Centene’s cross motion for 21 partial summary judgment on its counterclaim for declaratory 22 relief and Grove Way’s first cause of action for declaratory 23 relief is also DENIED. 24 2. Breach of Covenant of Good Faith and Fair Dealing 25 The covenant of good faith and fair dealing, implied by law 26 in every contract, exists to prevent one contracting party from 27 unfairly frustrating the other party’s right to receive the 28 benefits of the agreement. Gus v. Bechtel Nat. Inc., 8 P.3d 1 1089, 1110 (Cal. 2000). If a claim does not go beyond the 2 statement of a mere contract breach, and relying on the same 3 alleged acts, simply seeks the same damages or other relief 4 claimed in a companion contract claim, it may be disregarded as 5 superfluous, as no additional claim is actually stated. Careau 6 & Co. v. Sec. Pac. Bus. Credit, Inc., 272 Cal. Rptr. 387, 398 7 (Ct. App. 1990). 8 Grove Way seeks summary judgment on Centene’s second 9 counterclaim for the breach of the implied covenant of good 10 faith and fair dealing, arguing that it fails to go beyond the 11 breach of contract claim. Pl.’s Mot. at 20-22. Specifically, 12 both counterclaims allege Grove Way breached by attempting to 13 force Centene to pay for a substantially upgraded security 14 system, unreasonably delaying and withholding approval of their 15 construction plans and refusing to pay the allowances due. See 16 Answer and Countercl. ¶¶ 22-36. However, as Centene’s motion 17 clarifies, their breach of contract claim is based on Grove 18 Way’s failure to pay the allowances. See Def.’s Mot. at 29. 19 The other facts alleged regarding the security system and 20 withholding of approvals, support Centene’s position that 21 certain performance obligations of theirs were excused. See id. 22 at 18-30. In addition, Centene claims Grove Way’s insistence on 23 payment for a security system and unreasonable approval delays 24 amounted to a breach of the covenant of good faith and fair 25 dealing by unfairly frustrating their right to receive 26 allowances. See Def.’s Mot. at 31. Because Centene’s breach of 27 the implied covenant of good faith and fair dealing rests on 28 different conduct of Grove Way’s, not claimed to be a violation 1 of an explicit term of the lease, the Court finds that this 2 counterclaim is not superfluous as a matter of law. See 3 Digerati Holdings, LLC v. Young Money Entertainment, LLC, 123 4 Cal. Rptr. 3d 736, 745 (Ct. App. 2011)(noting the gravamen of 5 the two claims rests on different facts and different harm); see 6 also CACI No. 325 (noting the harm alleged in a breach of the 7 implied covenant of good faith and fair dealing may produce 8 contract damages that are different from those claimed for 9 breach of the express contract provisions). 10 Grove Way also argues that to the extent Centene’s claim 11 rests on Grove Way’s conduct regarding the security cameras, it 12 fails because Centene agreed to pay them. Pl.’s Mot at 21-22. 13 But Grove Way cites no authority that this would preclude 14 Centene from bringing a claim that Grove Way placing 15 unreasonable conditions on approval violated the implied 16 covenant of good faith and fair dealing. Id. Further, it is in 17 dispute what type of security system Centene agreed to pay for. 18 See Pl.’s SUF No. 58. Centene’s claim is that it was in bad 19 faith for Grove Way to condition its approval of the revised 20 plans on Centene paying for a substantially more expensive 21 system than it had removed and previously agreed to replace. 22 See Def.’s Mot. at 31-32. 23 For these reasons Grove Way’s motion for partial summary 24 judgment on Centene’s second counterclaim for breach of the 25 implied covenant of good faith and fair dealing is DENIED. 26 3. Quantum Meruit/Unjust Enrichment 27 A quantum meruit or quasi-contractual recovery rests upon 28 the equitable theory that a contract to pay for services is 1 implied by law for reasons of justice. Hedging Concepts, Inc. 2 v. First Alliance Mortgage Co., 41 Cal. App. 4th 1410, 1419 3 (1996). However, it is well settled that there is no equitable 4 basis for an implied-in-law promise to pay reasonable value when 5 the parties have an actual agreement covering compensation. 6 Id.; see also Durell v. Sharp Healthcare, 183 Cal. App. 4th 7 1350, 1370 (2010)(“As a matter of law, an unjust enrichment 8 claim does not lie where the parties have an enforceable express 9 contract.”) 10 Here, there is a valid, enforceable contract, making the 11 quantum meruit/unjust enrichment claim inapplicable. See id. 12 For this reason, Grove Way’s motion for partial summary judgment 13 on Centene’s quantum meruit/unjust enrichment counterclaim is 14 GRANTED and Centene’s cross motion for partial summary judgment 15 on this counterclaim is DENIED. 16 4. Accounting 17 “An accounting is an equitable proceeding which is proper when 18 there is an unliquidated and unascertained amount owing that 19 cannot be determined without an examination of the debts and 20 credits on the books to determine what is due and owing.” 21 Prakashpalan v. Engstrom, Lipscomb & Lack, 167 Cal. Rptr. 3d 22 832, 859 (Ct. App. 2014). 23 Centene’s sixth counterclaim is for accounting. Answer and 24 Countercl. ¶¶ 54-59. Centene contends this claim is necessary 25 to ascertain the amounts due and owing under the Lease, as Grove 26 Way in its breach of contract claim asserts that Centene is past 27 due on rent. Def.’s Mot. at 33; Compl. ¶ 28. Centene claims it 28 does not owe rent and that Grove Way has misappropriated ——— mE IIE I III II OIE SIN 1 Centene’s rent payments to disputed amounts. Def.’s Mot. at 33. 2 | Accordingly, an accounting is valid and necessary to determine 3 what has been paid to Grove Way, where this money has been 4 allocated and what if anything is currently due under the Lease. 5 For these reasons Plaintiff’s motion for partial summary 6 judgment on Defendant’s accounting counterclaim is DENIED. 7 Til. ORDER 8 For the reasons set forth above: 9 (1) Plaintiff’s motion for summary judgment on Defendant’s 10 first, second and sixth counterclaim is DENIED. 11 (2) Plaintiff’s motion for summary judgment on Defendant’s 12 fourth counterclaim is GRANTED. 13 (3) Defendant’s motion for summary judgment on its first, 14 fourth and fifth counterclaims is DENIED. 15 (4) Defendant’s motion for summary judgment on Plaintiff’s 16 first cause of action is DENIED. 17 (5) Pursuant to Federal Rule of Civil Procedure 56(g) any 18 fact not genuinely in dispute is deemed established in 19 the case. 20 IT IS SO ORDERED. 21 Dated: December 28, 2020 Lklpot, HN A, MENDEZ, 24 UNITED STATES DISTRICT 25 26 27 28 17