West et al v. All Aboard America Bus et al

Filing 35

ORDER by Magistrate Judge Jacqueline Scott Corley denying 24 Motion to Dismiss. (ahm, COURT STAFF) (Filed on 2/1/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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MICHAEL WEST, et al.,
Plaintiffs,

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United States District Court
Northern District of California

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ORDER DENYING MOTION TO
DISMISS

v.
ALL ABOARD AMERICA! HOLDINGS,
INC.,

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Case No.16-cv-04071-JSC

Re: Dkt. No. 24

Defendant.
ALL ABOARD AMERICA! HOLDINGS,
INC.,
Cross-Complainant,

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v.
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CITY AND COUNTY OF SAN
FRANCISCO and ROES 1 TO 5
Cross- Defendants.

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This action arises out of a vehicle accident between a bus and cable car. Plaintiffs,

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passengers of the cable car, allege physical injury as a result of the accident. Now pending before

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the Court is the motion of Third–Party Defendant City and County of San Francisco (“San

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Francisco”) to dismiss the Cross-Complaint of All Aboard America! Holdings, Inc. (“All

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Aboard”) for failure to comply with the California Tort Claims Act. (Dkt. No. 24.) The primary

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issue is whether All Aboard timely filed its Cross-Complaint. After carefully considering the

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parties’ submissions, and having had the benefit of oral argument on January 26, 2017, the Court

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DENIES the motion to dismiss. San Francisco has not shown as a matter of law that All Aboard

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failed to comply with the time requirements of the Act.

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BACKGROUND

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The accident which led to this lawsuit occurred on May 19, 2015. (Dkt. No. 1 at 11. 1) A

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bus, operated by All Aboard, collided with a cable car, operated by San Francisco, injuring three

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passengers: Michael West, Cherilyn Donato, and Elizabeth Ortiz. (Id.) All Aboard presented a

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government claim to San Francisco on July 14, 2015. 2 (Dkt. No. 26-1 at 2.) San Francisco denied

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the claim 13 days later, on July 27, 2015. (Dkt. No. 26-1 at 4.)
Nearly a year later, on June 6, 2016, Plaintiffs Michael West, Cherilyn Donato, and

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Elizabeth Ortiz filed suit against All Aboard in San Francisco County Superior Court. (Dkt. No. 1

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at 7.) Plaintiffs allege All Aboard breached the duty of reasonable care in operating a motor

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vehicle when its employee negligently struck a cable car, injuring Plaintiffs. All Aboard was

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United States District Court
Northern District of California

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served on June 15, 2016. (Dkt. No. 30 at 4.)
One month after the lawsuit was filed All Aboard presented another government claim to

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San Francisco, which was denied on July 22. (Dkt. No. 26-1 at 7, 9.) Two days before San

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Francisco denied this second government claim, All Aboard removed the case to federal court

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based on diversity of citizenship pursuant to 28 U.S.C. Section 1441(b). (Dkt. No. 1 at 1-2.)
On November 11, 2016, All Aboard filed a Third-Party complaint against San Francisco,

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seeking equitable indemnity in the event it is found liable in the underlying action. (Dkt. No. 22 at

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2.) San Francisco thereafter filed the instant motion to dismiss. (Dkt. No. 24.)

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DISCUSSION

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San Francisco moves to dismiss All Aboard’s Third-Party Complaint for equitable

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indemnity on the grounds that it fails to state a claim upon which relief can be granted. 3

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Record citations are to material in the Electronic Case File (“ECF”); pinpoint citations are to the
ECF-generated page numbers at the top of the documents.
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San Francisco requests that the Court take judicial notice of the dates of All Aboard’s two
government claims. (Dkt. No. 26 at 2.) All Aboard has not objected to San Francisco’s request.
The Court GRANTS the Request for Judicial Notice as to Exhibits A, B, C, and D which are part
of the public record and easily verifiable. See Fed. R. Evid. 201.
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The Court has diversity jurisdiction of Plaintiffs’ claims against All Aboard, 28 U.S.C. §
1332(a), and supplemental jurisdiction of All Aboard’s claim against San Francisco. 28 U.S.C. §
1367(a).
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The California Tort Claims Act, see Cal. Gov’t. Code §§ 810, et seq.—commonly referred

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to as the California Government Claims Act, see City of Stockton v. Sup. Ct., 42 Cal.4th 730, 741-

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42 (2007)— provides an avenue for individuals to bring suits against public agencies. Under the

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Act, all claims for money or damages against a local public entity must first be filed with the

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entity as a “condition precedent to the maintenance of the action.” Cal. Gov’t Code § 945.4; City

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of San Jose v. Sup. Ct., 12 Cal.3d 447, 454 (1974). The purpose of Section 945.4 is to provide the

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public agency an opportunity to investigate the facts underlying the claim, as well as to settle the

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claim and avoid litigation. City of San Jose, 12 Cal.3d at 447. Compliance with this “claim

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presentation requirement” constitutes an element of a cause of action for damages against a public
entity or official. Garedakis v. Brentwood Union School District, 183 F.Supp.3d 1032, 1040

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United States District Court
Northern District of California

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(N.D.Cal. 2016) (internal citations and quotation marks omitted). “[F]ailure to allege facts

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demonstrating or excusing compliance with the claim presentation requirement subjects a claim

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against a public entity to [dismissal] for failure to state a cause of action.” D.V. v. City of

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Sunnyvale, 65 F.Supp.3d 782, 786 (N.D.Cal. 2014) (internal citations and quotation marks

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omitted).

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Two claim presentation requirements are relevant here. First, All Aboard, as a party

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making a claim for equitable indemnity, was required to present its claim to San Francisco within

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six months of service on All Aboard of the complaint giving rise to All Aboard’s claim against the

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City for equitable indemnity. Cal. Gov’t Code §§ 901, 911.2; Centex Homes v. Superior Court,

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214 Cal.App.4th 1090, 1104 (Cal. Ct. App. 2013). Second, All Aboard was required to file its

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equitable indemnity claim against San Francisco within six months of San Francisco having given

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notice to All Aboard of its denial of the claim. Cal. Gov’t Code §§ 913, 945.6(a)(1).

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On June 15, 2016 individuals injured in the bus accident served a complaint on All

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Aboard, starting the six-month time limit for All Aboard to present an equitable indemnity claim

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to San Francisco. Cal. Gov’t Code §§ 901, 911.2 . All Aboard presented San Francisco with an

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equitable indemnity claim on July 8, 2016, which San Francisco denied on July 22. Following

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denial, All Aboard filed a cross-claim alleging equitable indemnity against San Francisco on

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November 11, 2016. Thus, All Aboard met the six-month claim presentment requirement, as well
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as the six month deadline to file suit against San Francisco.
San Francisco nonetheless insists that the claim is time-barred because All Aboard did not

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file its cross-complaint against San Francisco within six months of San Francisco’s rejection of

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All Aboard’s earlier July 2015 claim. It argues, in effect, that once All Aboard made a claim and

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the claim was rejected it had to file suit or lose the claim forever. In other words, even though the

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second claim was timely under the Act, it is of no force or effect: a claimant gets to make one

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claim and one claim only, even if subsequent claims are timely. The Court disagrees.

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First, San Francisco cites no authority for the proposition that a claim that is timely

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presented and timely filed is nonetheless barred merely because the claimant presented an earlier
claim. This omission is unsurprising given that there is no policy reason to so hold. Plaintiff’s

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United States District Court
Northern District of California

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July 2016 claim and subsequent lawsuit complied with the Act and thus San Francisco received all

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the notice (indeed more notice) than the Act requires. That is the end of the Court’s inquiry.

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Second, San Francisco’s argument is premised on the assumption that All Aboard’s first

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and second government claims are identical, that is, both presented the same claim for equitable

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indemnity. However, the Court cannot accept this assumption because on a motion to dismiss the

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Court must draw all reasonable inferences in favor of the nonmoving party. Manzarek v. St. Paul

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Fire & marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). Although All Aboard’s first

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government claim includes insurance information and identified the cable car passengers as the

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injured, the claim does not expressly mention equitable indemnity. Further, San Francisco

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indicated during oral argument that it automatically denies repeat claims, but All Aboard’s second

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claim was not denied as a repeat. Finally, All Aboard’s equitable indemnity claim had not accrued

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for purposes of presenting a claim. See Cal. Gov’t Code §§ 901, 911.2. While one could infer

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that the first claim was for equitable indemnity, drawing all inferences on the current record in All

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Aboard’s favor does not require the inference.

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Thus, San Francisco has failed to prove as a matter of law that All Aboard failed to comply
with presentment requirements of the California Tort Claims Act.
CONCLUSION
For the reasons stated above, the Court DENIES the motion to dismiss. (Dkt. No. 24.)
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IT IS SO ORDERED.
Dated: February 1, 2017

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JACQUELINE SCOTT CORLEY
United States Magistrate Judge

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United States District Court
Northern District of California

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