Judge: Armen Tamzarian, Case: 23STCV09594, Date: 2025-01-29 Tentative Ruling

Case Number: 23STCV09594    Hearing Date: January 29, 2025    Dept: 52

Defendants Abraham Melchor Espinoza and Olivia Valentin’s Motion for Summary Judgment, Summary Adjudication, or Judgment on the Pleadings

Defendants Abraham Melchor Espinoza and Olivia Valentin move for summary judgment of this action against them by plaintiff CoriAndre Crane.  In the alternative, defendants move for summary adjudication of each cause or action, or for judgment on the pleadings.

Legal Standard

            A defendant moving for summary adjudication of a cause of action must show “that one or more elements of the cause of action… cannot be established, or that there is a complete defense to the cause of action.”  (Code Civ. Proc., § 437c, subd. (p)(2).)  Once the defendant does so, the burden shifts to the plaintiff to show a triable issue of at least one material fact.  (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849.)

Summary of Allegations

            Plaintiff’s first amended complaint brings seven causes of action against Espinoza and Valentin: the first cause of action for breach of contract, the third for fraudulent misrepresentation, the fourth for nondisclosure of material facts, the fifth for breach of the implied covenant of good faith and fair dealing, the sixth for unjust enrichment, the seventh for negligence, and the eighth for unfair business practices.

The first amended complaint alleges that in January 2022, plaintiff agreed to purchase real property from Espinoza and Valentin.  (FAC ¶ 12.)  The sellers’ real estate transfer disclosure statement stated the sellers “were not aware of any significant defects or malfunctions with the foundation, electrical system, plumbing system or roof on the Property.”  (¶ 14.) 

Plaintiff alleges, “In reality, there were major defects and many of them were clearly visible per the inspection report on the Property.  The entire foundation has cracks and other issues that affect the structural integrity of the entire Property.  There are electrical system issues that prevent the use of multiple lights and outlets at the same time, requiring significant repairs and upgrades of the Property.  There were plumbing issues that could result in sewage backing up into drains in the bathrooms and kitchen.  The roof was in need of serious repair.  The HVAC system is deficient for the needs of the Property.”  (¶ 15.)  She further alleges, “The January 28, 2022 inspection of the Property confirmed the above undisclosed defects.”  (¶ 17.)  “Crane was never informed of these defects by the Seller Defendants, nor the Sellers’ Agents, nor was she informed by her realtor, [Darrell] Burns, or her broker, Savient … .  The defects were also withheld by the Sellers’ Agents.”  (¶ 18.) 

Plaintiff further alleges that her agent, Burns, “email[ed] the January 28, 2022 inspection report to Crane without comment on February 8, 2022.” (¶ 19.)  “Crane had no idea of the importance of the inspection report emailed to her because Burns failed to advise her.  Crane went ahead and signed the final escrow papers at the direction of Burns.”  (¶ 21.)  Finally, plaintiff alleges she “signed a ‘Contingency Removal’ on February 10, 2022 pursuant to Burns’ instructions.  Burns failed to advise Crane as to the importance of this document as well.  Burns never advised or mentioned to Crane that signing this document meant that she waived a pre-closing inspection.”  (¶ 22.)

Discussion

Espinoza and Valentin meet their burden of showing they are entitled to summary judgment on all causes of action against them.  Each of plaintiff’s claims rely on the same theory: that defendants failed to disclosure material defects in the property, she relied on defendants’ disclosures, and their misrepresentations or omissions caused damages to her.  Defendants present evidence that any reliance on their disclosures was unjustified and did not cause plaintiff’s damages.

            “[T]he reasonableness of the reliance is ordinarily a question of fact.  [Citations.]  However, whether a party’s reliance was justified may be decided as a matter of law if reasonable minds can come to only one conclusion based on the facts.”  (Guido v. Koopman (1991) 1 Cal.App.4th 837, 843.)  “ ‘[T]he right to rely upon the representations … does not exist where a purchaser chooses to inspect the property before purchase, and, in making such inspection, learns the true facts, for the obvious reason that he has not been defrauded unless he has been misled, and he has not been misled where he has acted with actual or imputed knowledge of the true facts.’ ”  (Blackman v. Howes (1947) 82 Cal.App.2d 275, 279-280.)

            The only reasonable conclusion based on this record is that plaintiff’s reliance on defendants’ representations or omissions was not justifiable.  Plaintiff chose to inspect the property before the purchase and thereby learned or should have learned the true facts.  Plaintiff’s first amended complaint alleges, “The January 28, 2022 inspection of the Property confirmed the above undisclosed defects.”  (FAC, ¶ 17, italics added.)  It is undisputed that plaintiff received a copy of the inspection report on February 8, 2022 (Crane Decl., ¶ 4), before she removed the inspection contingency two days later (id., ¶ 7).  Defendants’ alleged misrepresentations or omissions therefore also did not proximately cause plaintiff’s damages. 

            In real property transactions, “a buyer is not relieved of ‘the duty to exercise reasonable care to protect himself or herself, including those facts … which are known to or within the diligent attention and observation of the buyer’ (Civ. Code, § 2079.5); and a buyer is held to be aware of obvious and patent conditions.”  (Furla v. Jon Douglas Co. (1998) 65 Cal.App.4th 1069, 1079.)  A diligent buyer would have reviewed the inspection report that “confirmed” the property’s defects.  (FAC, ¶ 17.)  Removing the inspection contingency and completing the transaction constitutes failure to exercise reasonable care.

Plaintiff’s opposition does not demonstrate any triable issue of material fact.  The opposition argues defendants made false representations.  This motion does not seek to prove otherwise.  The motion contends that, assuming defendants made false disclosures to plaintiff, they are still entitled to judgment as a matter of law.

The opposition further argues plaintiff lacked experience and relied on her real estate agent, Darrell Burns, whom she asserts failed to “provide guidance or clarify the significance of the … inspection report” and “directed” her to remove the inspection contingency.  (Opp., p. 6.)  Plaintiff provides no authority supporting the proposition that her reliance on her agent made it justifiable to rely on the sellers’ representations.  Plaintiff’s reliance on Burns might bolster her claims against him, but it is irrelevant to her claims against the sellers.

Plaintiff’s opposition cites Hinesley v. Oakshade Town Center (2005) 135 Cal.App.4th 289, 301 for the proposition that “reliance is reasonable when the buyer cannot verify the truth of the seller’s representations.”  In that case, the court noted prior authority that a “ ‘seller of real property has a duty to disclose where seller knows facts materially affecting value or desirability of the property which are known or accessible only to him and seller knows facts are not known or within reach of diligent attention and observation of buyer.’ ”  (Id. at p. 303.)  The facts were within the reach of plaintiff’s diligent attention and observation.  She had an expert inspect the property.  She received an email containing the inspector’s report. 

Finally, plaintiff argues the sellers’ conduct constitutes constructive fraud.  Plaintiff’s reliance on Salahutdin v. Valley of California, Inc. (1994) 24 Cal.App.4th 555 is misplaced.  “ ‘Constructive fraud is a unique species of fraud applicable only to a fiduciary or confidential relationship.’ ”  (Id. at p. 563.)  Plaintiff provides no authority that, in real property transactions, sellers have a fiduciary or confidential relationship with buyers.  “[T]he ‘relationship of seller to buyer is not one ordinarily vested with fiduciary obligation.’ ”  (Martinez v. Welk Group, Inc. (S.D. Cal. 2012) 907 F.Supp.2d 1123, 1133; accord Holmes v. Summer (2010) 188 Cal.App.4th 1510, 1528 “[the seller’s agent does not generally owe a fiduciary duty to the buyer”].) 

Disposition

            Defendants Abraham Melchor Espinoza and Olivia Valentin’s motion for summary judgment is granted.