Judge: Andrew E. Cooper, Case: 23CHCV03054, Date: 2024-01-04 Tentative Ruling

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Case Number: 23CHCV03054    Hearing Date: January 4, 2024    Dept: F51

DEMURRER WITH MOTION TO STRIKE

Demurrer with Motion to Strike Filed: 11/15/23

MOVING PARTY: Defendant State Farm Mutual Automobile Insurance Company (“Defendant”)

RESPONDING PARTY: Plaintiff Larry Brent, in pro per (“Plaintiff”)

NOTICE: OK

RELIEF REQUESTED: Defendant demurs to the second and third causes of action in Plaintiff’s complaint. Defendant also seeks an order striking Plaintiff’s’ references to punitive damages and attorney fees from the complaint.

TENTATIVE RULING: The unopposed demurrer is sustained, and the unopposed motion to strike is granted. Plaintiff is granted 30 days leave to amend.

BACKGROUND 

This is a breach of contract action in which Plaintiff alleges that Defendant failed to pay him benefits owed for damages to his vehicle caused by a 3/7/22 collision, in breach of the agreed-upon insurance policy between the parties. (Compl. ¶¶ 7–12.)

On 10/11/23, Plaintiff filed his complaint against Defendant, alleging the following causes of action: (1) Breach of Contract; (2) Tortious Breach of the Covenant of Good Faith and Fair Dealing; and (3) Declaratory Relief.

On 11/15/23, Defendant filed the instant demurrer and motion to strike. No opposition has been filed to date.

DEMURRER

As a general matter, a party may respond to a pleading against it by demurrer based on any single or combination of eight enumerated grounds, including that “the pleading does not state facts sufficient to constitute a cause of action.” (Code Civ. Proc., § 430.10, subd. (e).) In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice.¿(Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.)¿

“A demurrer tests the pleading alone, and not the evidence or facts alleged.” (E-Fab, Inc. v. Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.) As such, the court assumes the truth of the complaint’s properly pleaded or implied factual allegations. (Ibid.) The only issue a demurrer is concerned with is whether the complaint, as it stands, states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) 

Here, Defendant demurs to the second and third causes of action in Plaintiff’s complaint on the basis that Plaintiff fails¿to allege facts sufficient to¿constitute¿those causes of action.

A.    Meet and Confer

Before filing its demurrer, “the demurring party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.” (Code Civ. Proc. § 430.41, subd. (a).) The demurring party must file and serve a meet and confer declaration stating either: “(A) The means by which the demurring party met and conferred with the party who filed the pleading subject to demurrer, and that the parties did not reach an agreement resolving the objections raised in the demurrer;” or “(B) That the party who filed the pleading subject to demurrer failed to respond to the meet and confer request of the demurring party or otherwise failed to meet and confer in good faith.” (Id. at subd. (a)(3).)

Here, Defendant’s counsel declares that on 11/15/23, she and Plaintiff met and conferred telephonically to resolve the issues raised in the instant demurrer and motion to strike, but the parties were unable to come to a resolution. (Decl. of Christy Gargalis, ¶ 4.) Accordingly, the Court finds that counsel has satisfied the preliminary meet and confer requirements of Code of Civil Procedure section 430.41, subdivision (a).

B.     Breach of Implied Covenant of Good Faith and Fair Dealing

Plaintiff’s third cause of action alleges Tortious Breach of the Implied Covenant of Good Faith and Fair Dealing (Insurance Bad Faith) against Defendant. Every contract contains an implied covenant of good faith and fair dealing that neither party will do anything to interfere with the other party's right to receive the benefits of the agreement. (Howard v. American Nat'l Fire Ins. Co. (2010) 187 Cal.App.4th 498, 528.) The precise nature and extent of the duty depends on the nature and purpose of the underlying contract and the parties’ legitimate expectations arising from the contract. (Ibid.)

In the insurance context, “an insurer’s erroneous failure to pay benefits under a policy does not necessarily constitute bad faith entitling the insured to recover tort damages. The ultimate test of [bad faith] liability in the first party cases is whether the refusal to pay policy benefits was unreasonable.” (Opsal v. United Services Auto. Assn. (1991) 2 Cal.App.4th 1197, 1205 [internal quotations and citations omitted].) “In other words, before an insurer can be found to have acted tortiously, i.e., in bad faith, in refusing to bestow policy benefits, it must have done so without proper cause.” (Ibid. [internal quotations omitted].)

However, “if the allegations [of breach of implied covenant of good faith and fair dealing] do not go beyond the statement of a mere contract breach and, relying on the same alleged acts, simply seek the same damages or other relief already claimed in a companion contract cause of action, they may be disregarded as superfluous as no additional claim is actually stated.” (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1395.)

Here, Plaintiff alleges that Defendant “wrongfully and unreasonably denied the claim made by [Plaintiff] and by wrongfully and unreasonably withholding benefits due under the subject policy of insurance.” (Compl. ¶ 19.) “Despite Plaintiff’s repeated demands for reimbursement and for payment for covered losses, defendants and each of them have continued to wrongfully and unreasonably refuse payment and to indemnify the plaintiff for the damages of the vehicle and have continued wrongfully and unreasonably to engage in unlawful insurance practices and representations.” (Id. at ¶ 20.)

Defendant argues that here, “Plaintiff simply repeats the allegations that State Farm did not pay benefits Plaintiff believes were owed (i.e. breach of contract) and that Plaintiff contends such conduct was unreasonable. Plaintiff does not allege any facts at all, let alone facts to show State Farm acted in an unreasonable manner. Plaintiff's conclusory allegations that State Farm's conduct was ‘wrongful’ and ‘unreasonable’ is simply a conclusory allegation.” (Dem. 6:21–24, citing Compl. ¶ 21.) The Court agrees and finds that Plaintiff’s complaint lacks factual allegations supporting his claim that Defendant’s withholding of benefits compensation was done so wrongfully or unreasonably. Moreover, the conduct alleged by way of this cause of action appears to be the same conduct alleged in Plaintiff’s first cause of action for Breach of Contract. The Court notes that Plaintiff has failed to oppose the instant demurrer.

Based on the foregoing, the Court finds that Plaintiff has failed to allege facts sufficient to constitute a cause of action for Breach of the Implied Covenant of Good Faith and Fair Dealing. Accordingly, the demurrer is sustained as to Plaintiff’s second cause of action.

C.    Declaratory Relief

Plaintiff’s third cause of action against Defendant alleges Declaratory Relief. “To qualify for declaratory relief, a party would have to demonstrate its action presented two essential elements: (1) a proper subject of declaratory relief, and (2) an actual controversy involving justiciable questions relating to the party’s rights or obligations.” (Jolley v. Chase Home Finance, LLC (2013) 213 Cal.App.4th 872, 909.) “There is no basis for declaratory relief where only past wrongs are involved.” (Osseous Technologies of America, Inc. v. DiscoveryOrtho Partners LLC (2010) 191 Cal.App.4th 357, 366.) A cause of action for declaratory relief should not be used as a second cause of action for the determination of identical issues raised in another cause of action. (General of America Insurance Co. v. Lilly (1968) 258 Cal.App.2d 465, 470.)

Here, Plaintiff alleges that “defendants and each of them owe a duty to the plaintiff to honor the claim and to … compensate the plaintiff for the damages of the FERRARI. Unfortunately, to date, defendants and each of them have wrongfully and constructively refused to honor the claim made and have unreasonably and wrongfully refused to indemnify the plaintiff for the valid claims for damages that have been presented.” (Compl. ¶¶ 24–25.)

Defendant argues that “Plaintiff's claim has crystalized into an accrued cause of action for breach of contract against State Farm.” (Dem. 7:23–24.) As such, “Plaintiff's cause of action for declaratory relief has matured into causes of action for alleged past wrongs, and a money judgment will fully resolve the dispute.” (Id. at 8:1–2.) The Court agrees and finds that Plaintiff’s declaratory relief claim concerns “only past wrongs” in that Defendant allegedly wrongfully withheld benefits from Plaintiff. (Osseus, 191 Cal.App.4th at 366.) Therefore, on the face of the complaint, there is no basis for Plaintiff’s declaratory relief claim. (Ibid.) Accordingly, the Court sustains the demurrer to Plaintiff’s third cause of action.

MOTION TO STRIKE

The court may, upon a motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading. (Code Civ. Proc., § 436, subd. (a).) The court may also strike all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court. (Id., § 436, subd. (b).) The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. (Id., § 437.)

A.    Punitive Damages

Here, Defendant moves to strike Plaintiff’s references to punitive damages from the complaint. Punitive damages may be recovered in actions not arising from breach of contract, upon a proper showing of malice, fraud, or oppression by clear and convincing evidence. (Civ. Code § 3294, subd. (a).) “Malice” is defined as conduct intended to cause injury to a person or despicable conduct carried on with a willful and conscious disregard for the rights or safety of others. (Id. at subd. (c); Turman v. Turning Point of Cent. Cal., Inc. (2010) 191 Cal.App.4th 53, 63.) “Oppression” means despicable conduct subjecting a person to cruel and unjust hardship, in conscious disregard of the person’s rights. (Ibid.) “Fraud” is an intentional misrepresentation, deceit, or concealment of a material fact known by defendant, with intent to deprive a person of property, rights or otherwise cause injury. (Ibid.)

Punitive damages must be supported by factual allegations. Conclusory allegations, devoid of any factual assertions, are insufficient to support a conclusion that parties acted with oppression, fraud or malice. (Smith v. Superior Court (1992) 10 Cal.App.4th 1033, 1042; Anschutz Entertainment Group, Inc. v. Snepp (2009) 171 Cal.App.4th 598, 643.)

Here, Defendant argues that “because the only viable cause of action is for breach of contract, Plaintiff's claim for punitive damages fails. A breach of contract claim cannot form the basis for punitive damages.” (MTS 4:23–24.) Defendant further argues that Plaintiff’s factual “allegations are entirely conclusory and insufficient to state a claim for punitive damages.” (Id. at 6:3–4.) The Court agrees and finds that to the extent that Plaintiff’s sole viable cause of action against Defendant is for breach of contract, he is not entitled to punitive damages. (Civ. Code § 3294, subd. (a).) Moreover, the Court finds that Plaintiff’s complaint is devoid of factual allegations supporting a showing of “malice, fraud, or oppression” such as to warrant a prayer for punitive damages. Accordingly, the Court grants Defendant’s motion to strike Plaintiff’s references to punitive damages from the complaint.

LEAVE TO AMEND

Where a demurrer is sustained, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Id.; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.) However, “[i]f there is any reasonable possibility that the plaintiff can state a good cause of action, it is error to sustain a demurrer without leave to amend.” (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240, 245).

Here, the Court notes that while Plaintiff has failed to oppose the instant demurrer, this is the first demurrer brought against Plaintiff’s original complaint. Therefore, under the Court’s liberal policy of granting leave to amend, Plaintiff is granted 30 days leave to amend the complaint to cure the defects set forth above.

CONCLUSION 

The unopposed demurrer is sustained, and the unopposed motion to strike is granted. Plaintiff is granted 30 days leave to amend.