Borden, LLC v. Elegant Fireplace Mantels CA2/5
B334666M
Cal. Ct. App.Jun 9, 2025Background
- Borden LLC (landlord) sued its tenant, Elegant Fireplace Mantels, Inc., and the individuals Eytan Libesman and Mark Tzalka for breach of lease after the tenant failed to pay rent and vacate the premises at the lease's end.
- The individuals were listed as "Lessee" in the lease's preamble and signature block, but it was ambiguous whether they signed in an individual or representative capacity.
- After failing to name Libesman and Tzalka in a prior unlawful detainer action, Borden filed a separate civil lawsuit seeking damages under the lease.
- The trial court overruled defendants’ demurrers and denied their summary judgment motions, then entered a default judgment against all defendants due to defense counsel's failure to comply with local rules for joint trial documents.
- Defendants appealed, arguing (among other things) that they should not have been defaulted for their attorney’s misconduct and that summary judgment should have been granted in favor of the individuals.
Issues
| Issue | Borden's Argument | Libesman/Tzalka's Argument | Held |
|---|---|---|---|
| Overruling Demurrer | Lease shows individuals as lessees; complaint sufficiently pleads breach | Lease ambiguous, should not be liable as individuals | Demurrer properly overruled; ambiguity lets complaint survive |
| Denial of Summary Judgment | There is a factual dispute over who is liable | Lease/evidence shows individuals not liable; prior litigation bars claim | Summary judgment properly denied; factual disputes remain, no issue preclusion |
| Striking Answers & Default | Defendants (and not solely counsel) failed to comply with local rules and orders | Only counsel failed to comply; clients should not be punished for attorney error | Default judgment reversed; penalty against clients improper under statute |
| Issue Preclusion from Unlawful Detainer | Prior case resolved individuals' liability | Not named as parties in prior case; no preclusion | No issue preclusion; prior action only resolved possession, not liability |
Key Cases Cited
- Garcia v. McCutchen, 16 Cal.4th 469 (Cal. 1997) (counsel’s procedural mistakes should not impair the client’s case)
- Lang v. Hochman, 77 Cal.App.4th 1225 (Cal. Ct. App. 2000) (standard for reviewing sanctions orders)
- Moyal v. Lanphear, 208 Cal.App.3d 491 (Cal. Ct. App. 1989) (dismissal appropriate only if client caused counsel’s failures)
- In re Marriage of Colombo, 197 Cal.App.3d 572 (Cal. Ct. App. 1987) (sanctions improper absent client responsibility for attorney delay)
- Falkowski v. Imation Corp., 132 Cal.App.4th 499 (Cal. Ct. App. 2005) (corporate officer not personally liable if signing above title)