Judge: Andrew E. Cooper, Case: 24CHCV03053, Date: 2025-02-06 Tentative Ruling

Case Number: 24CHCV03053    Hearing Date: February 6, 2025    Dept: F51

Dept. F-51¿ 

Date: 2/6/25

Case #24CHCV03053

LOS ANGELES SUPERIOR COURT

NORTH VALLEY DISTRICT

DEPARTMENT F-51

DEMURRER

Demurrer Filed: 10/11/24

MOVING PARTY: Defendant Gino Ferrari (“Defendant”)

RESPONDING PARTY: Plaintiff Marcello Ferrari (“Plaintiff”)

NOTICE: OK

RELIEF REQUESTED: Defendant demurs against Plaintiff’s second cause of action.

TENTATIVE RULING: The demurrer is sustained with 20 days leave to amend.

BACKGROUND

This is a contract action in which Plaintiff alleges that he was the General Manager of Ferrari For Metal (the “Company”), of which Defendant was the principal and sole owner. (Compl. ¶¶ 3–4, 7.) On 6/6/23, Plaintiff and Defendant entered into a profit-sharing agreement in which “the parties would share the Company’s costs evenly and after all costs were covered, Gino would receive 60% of the profits and Marcello would receive 40% of the profits. Furthermore, the Agreement stated that both individuals were to be paid after a client had paid their invoice and all expenses for the project had been covered.” (Id. at ¶¶ 12–13.) Plaintiff alleges that despite their agreement, “between June 6 and November 7, 2023, Gino failed to provide Marcello with his share of the profits the Company generated according to the Agreement.” (Id. at ¶ 14.)

On 8/22/24, Plaintiff filed his complaint alleging the following causes of action against Defendant: (1) Breach of Contract; (2) Unjust Enrichment; and (3) Promissory Estoppel.

On 10/11/24, Defendant filed the instant demurrer. On 1/23/25, Plaintiff filed his opposition. No reply has been filed to date.

ANALYSIS

As a general matter, a party may respond to a pleading against it by demurrer on the basis of 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 Plaintiff’s second cause of action on the basis that Plaintiff fails to allege facts sufficient to constitute a cause of action for Unjust Enrichment.

A.    Meet and Confer

Moving Defendant’s counsel declares that on 10/4/24, he sent Plaintiff’s counsel a meet and confer letter discussing the issues raised in the instant demurrer, but the parties were unable to reach an agreement. (Decl. of Sepehr Omrani ¶¶ 3–5.) Therefore, the Court finds that counsel has satisfied the preliminary meet and confer requirements of Code of Civil Procedure section 430.41, subdivision (a).

B.     Unjust Enrichment

Plaintiff’s second cause of action alleges Unjust Enrichment against Defendant. “The elements for a claim of unjust enrichment are receipt of a benefit and unjust retention of the benefit at the expense of another. The theory of unjust enrichment requires one who acquires a benefit which may not justly be retained, to return either the thing or its equivalent to the aggrieved party so as not to be unjustly enriched.” (Lyles v. Sangadeo-Patel (2014) 225 Cal.App.4th 759, 769 [quotations and citations omitted.])

Here, Defendant argues that Plaintiff is barred from bringing his second cause of action because “plaintiff has plead the existence of an enforceable agreement and does not deny the existence or enforceability of that agreement. Therefore, the existence of a binding contract precludes plaintiff from alleging unjust enrichment in the alternative to breach of contract.” (Dem. 5:14–16, citing Klein v. Chevron U.S.A., Inc. (2012) 202 Cal.App.4th 1342.)

In Klein, the Court of Appeal found that “if a plaintiff was uncertain as to whether the parties had entered into an enforceable agreement, the plaintiff would be entitled to plead inconsistent claims predicated on both the existence and absence of such an agreement,” including pleading a cause of action for unjust enrichment. (202 Cal.App.4th at 1388.) “A plaintiff may not, however, pursue or recover on a quasi-contract claim if the parties have an enforceable agreement regarding a particular subject matter.” (Ibid.) The Klein court ultimately found that “although a plaintiff may plead inconsistent claims that allege both the existence of an enforceable agreement and the absence of an enforceable agreement, that is not what occurred here. Instead, plaintiffs’ breach of contract claim pleaded the existence of an enforceable agreement and their unjust enrichment claim did not deny the existence or enforceability of that agreement. Plaintiffs are therefore precluded from asserting a quasi-contract claim under the theory of unjust enrichment.” (Id. at 1389–1390.)

Plaintiff argues in opposition that the enforceability of the agreement is disputed, therefore Plaintiff is not barred from presenting a claim for unjust enrichment. Plaintiff asserts that during the parties’ meet and confer discussions, Plaintiff offered to withdraw his second cause of action “if Gino agreed to stipulate to the enforceability of the contract.” (Pl.’s Opp. 3:6–7, citing Ex. 1 to Decl. of Robert Paredes.) “Here, Gino will not acknowledge the enforceability of the document he identified as an agreement between him and Marcello. As long as that is the case, Marcello may plead Unjust Enrichment in the alternative.” (Id. at 5:10–12.)

However, the Court notes that the Court’s analysis is limited to the four corners of the complaint and judicially noticeable. Therefore, the Court declines to consider the parties’ meet and confer discussions as they pertain the factual sufficiency of Plaintiff’s complaint. Here, as in Klein, Plaintiff’s Unjust Enrichment cause of action does not “deny the existence or enforceability” of the profit-sharing agreement alleged in Plaintiff’s Breach of Contract cause of action. (202 Cal.App.4th at 1389.) In fact, Plaintiff’s second cause of action “repeats and incorporates herein by reference all of the allegations set forth above,” including that the parties entered into the subject agreement. (Compl. ¶ 27.)

Based on the foregoing, the Court finds that Plaintiff has failed to allege facts sufficient to constitute a cause of action for unjust enrichment. Accordingly, the demurrer is sustained.

C.    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 this is the first demurrer brought against Plaintiff’s original complaint, and that Plaintiff seeks leave to amend in the event that the Court sustains the demurrer. (Pl.’s Opp. 5:15–22.) Accordingly, under the Court’s liberal policy of granting leave to amend, the Court grants Plaintiff 20 days leave to amend the complaint to cure the defects set forth above.

CONCLUSION

The demurrer is sustained with 20 days leave to amend.