Articles Tagged with liability

Who says the economy is stagnant? California’s commercial construction industry shows the highest level of activity since 2001, and further growth is expected over the next three years, according to an article published in L.A. Biz.

This promising news originated in a study conducted by Allen Matkins, a California law firm, and UCLA’s Anderson School of Management. The study examined seven of California’s major markets for indicators of future commercial construction. More easily accessible financing and low cap rates, along with increased demand from technology, advertising, media and information companies has helped spur the commercial construction growth.

With Commercial Construction Growth Comes Increased Risk of Litigation

In the recent ruling of DKN Holdings, LLC v. Wade Faerber (decided on July 13, 2015) the California Supreme Court helped clarify the meaning of joint and several liability holding. Parties that are jointly and severally liable on the same obligation can be sued in separate actions which are not barred by the doctrines of claim preclusion or issue preclusion.

The cause of action for this case arose from Caputo, Faerber, and Neel, three individuals who each signed a ten-year lease to operate a gym in a shopping center. Caputo later sued DKN, the landlord, for damages and rescission of the lease based on fraud, breach of contract, and other claims. DKN cross-complained for rent and other monies due under the lease. DKN won at a bench trial and was awarded over $2.8 million in damages. DKN then sued Faerber and Neel for breach of the lease.

Faerber demurred, arguing that, because the landlord’s rights under the lease was adjudicated in the first action, suit against him was barred by the rule against splitting a cause of action. In opposition, the landlord argued that separate actions are permitted against parties who are jointly and severally liable. The trial court sustained the demurrer without leave to amend and entered judgment for Faerber.

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