Judge: Armen Tamzarian, Case: 23STCV20653, Date: 2023-11-09 Tentative Ruling
Case Number: 23STCV20653 Hearing Date: November 9, 2023 Dept: 52
Defendant
FPI Management, Inc.’s Demurrer and Motion to Strike Portions of Plaintiff’s Complaint
Demurrer
Defendant FPI Management, Inc. demurs to all
eight causes of action alleged by plaintiff Mez, Inc. doing business as Luxe
Concierge and doing business as Luxe Security Services.
1st Cause of Action: Breach of Contract
Plaintiff alleges sufficient facts for this
cause of action. The elements are: “(1)
the existence of the contract, (2) plaintiff’s performance or excuse for
nonperformance, (3) defendant’s breach, and (4) the resulting damages to the
plaintiff.” (Oasis West Realty, LLC
v. Goldman (2011) 51 Cal.4th 811, 821.)
A
complaint alleging breach of contract “may plead the legal effect of the
contract” and is not required to attach the contract or plead its terms
verbatim. (Construction Protective Services, Inc. v. TIG Specialty Ins. Co.
(2002) 29 Cal.4th 189, 199.)
Plaintiff
alleges the parties “entered into a written agreement wherein Plaintiff agreed
to provide security guard services to Defendant FPI, a manager of residential
real properties.” (Comp., ¶ 13.) Plaintiff alleges it performed under the
agreement. (¶ 14.) It alleges defendant breached the contract “by
failing and refusing to pay Plaintiff for the services.” (¶ 15.)
It alleges plaintiff suffered damages in that defendant did not pay
everything owed. (¶¶ 15-16.)
Defendant argues plaintiff fails to allege
the relevant parties to the contract because FPI is a property manager, not a
property owner, and does not allege which properties the contract applies
to. Plaintiff clearly alleges the
parties to the contract: “Plaintiff and Defendant FPI and each of them, entered
into a written agreement.” (¶ 13.) Whether FPI manages or owns the properties
and the properties’ addresses are irrelevant.
This cause of action is crystal clear: defendant agreed to pay for
services, plaintiff provided the services, and defendant did not pay.
2nd Cause of Action: Civil Code § 1719
Defendant
demurs to this cause of action on the basis that plaintiff did not allege it
sent defendant a demand for payment via certified mail. “In the case of a stop payment, a court may
not award damages or costs under this section unless the court receives into
evidence a copy of the written demand that, in that case, shall have been sent
to the drawer and a signed certified mail receipt showing delivery, or
attempted delivery if refused, of the written demand to the drawer’s last known
address.” (Civ. Code, § 1719(d).) This subdivision refers to what the court
must “receive[] into evidence,” not what the plaintiff’s complaint must
allege. Regardless, plaintiff’s
complaint attaches and incorporates five written demands to make payment, each
of which state “via certified mail (return receipt requested).” (Comp., ¶ 21,
Ex. 1.)
3rd, 4th, and 5th Causes of Action: Common
Counts
Plaintiff
alleges sufficient facts for the third cause of action for open account, the
fourth cause of action for account stated, and the fifth cause of action for
goods and services rendered. These are three
forms of common counts. Rather than “a specific cause of action,” a
common count “is a simplified form of pleading normally used to aver the
existence of various forms of monetary indebtedness” often “used as an
alternative way of seeking the same recovery demanded in a specific cause of
action.” (McBride v. Boughton (2004)
123 Cal.App.4th 379, 394.) “The only
essential allegations of a common count are ‘(1) the statement of indebtedness
in a certain sum, (2) the consideration, i.e., goods sold, work done, etc., and
(3) nonpayment.’ ” (Farmers Ins.
Exchange v. Zerin (1997) 53 Cal.App.4th 445, 460.)
The complaint alleges all essential
facts. It alleges defendant owes it $253,752. (Comp., ¶¶ 25, 28, 3233.) It alleges plaintiff provided services:
security at properties defendant managed.
(¶¶ 13-15.) And it alleges
defendant did not pay the $253,752 owed.
(¶¶ 26, 29, 33.)
Defendant’s demurrer relies on cases about
the sufficiency of evidence, not the allegations of the complaint. (Tsemetzin v. Coast Federal Savings &
Loan Assn. (1997) 57 Cal.App.4th 1334, 1343 [plaintiff did not allege the
theory of open book account, but summary judgment also proper because plaintiff
“produced no evidence sufficient to raise a material issue of fact on the point”];
Maggio, Inc. v. Neal (1987) 196 Cal.App.3d 745, 752 [“no evidence of an
agreement between the parties that the loans to Neal would be carried as a book
account”] & 753 [“no evidence that Neal knew that he was indebted to Maggio
or that he was aware that Maggio was maintaining an account which showed his
increasing indebtedness”]; H. Russell Taylor's Fire Prevention Service, Inc.
v. Coca Cola Bottling Corp. (1979) 99 Cal.App.3d 711, 728 [finding “sufficient
evidence supporting the trial court’s conclusion that Taylor was barred from seeking
relief on the basis of an open book account”].)
These cases do not support defendant’s argument that plaintiff’s
complaint fails to state sufficient facts to constitute these causes of action.
6th
and 7th Causes of Action: Fraud and Negligent Misrepresentation
Plaintiff does not allege these causes of action
with the required level of specificity. “Fraud
and negligent misrepresentation must be pleaded with particularity and by facts
that ‘ “ ‘show how, when, where, to
whom, and by what means the representations were tendered.’ ” ’ ” (Charnay v. Cobert (2006) 145
Cal.App.4th 170, 185, fn. 14.) “ ‘This
particularity requirement necessitates pleading facts which
show how, when, where, to whom, and by what means the representations were
tendered.’ ” (Lazar v. Superior Court (1996)
12 Cal.4th 631, 645.) “A plaintiff’s
burden in asserting a fraud claim against a corporate employer is even
greater. In such a case, the plaintiff
must ‘allege the names of the persons who made the allegedly fraudulent
representations, their authority to speak, to whom they spoke, what they said
or wrote, and when it was said or written.’ ”
(Ibid.)
Intentional misrepresentation requires: “(a)
misrepresentation; (b) defendant’s knowledge of the statement’s falsity; (c)
intent to defraud (i.e., to induce action in reliance on the
misrepresentation); (d) justifiable reliance; and (e) resulting damage.” (Hunter v. Up-Right, Inc. (1993) 6
Cal.4th 1174, 1184.) Negligent
misrepresentation requires the same elements as intentional misrepresentation
except for “knowledge of falsity.” (Apollo
Capital Fund, LLC v. Roth Capital Partners, LLC (2007) 158 Cal.App.4th 226,
243.) It instead requires
misrepresentation “without reasonable ground for believing it to be true.” (Ibid.)
The complaint alleges, “In or about November 2022,
Defendant FPI, by and through Joshua Moore, represented, warranted and promised
to Plaintiff, via telephone calls and written communications, that occurred in Los
Angeles, California, that they: (i) had the financial means and ability to
enter into the Agreement and to pay for services rendered by Plaintiff; and
(ii) they could and would pay Plaintiff in connection with the Agreement and
the services rendered by Plaintiff.”
(Comp., ¶ 35.)
Plaintiff thus alleges how, when, where, and by
what means the misrepresentations were made.
Plaintiff also alleges the name of the person who made the
representations and what he said. The
complaint does not, however, allege Joshua Moore’s authority to speak on behalf
of defendant. It makes no allegations
about his relationship to defendant FPI Management, Inc. or how he is
authorized to speak for it. The
complaint also does not allege the person to whom Moore spoke. It only alleges he spoke “to Plaintiff,” a
corporation.
8th Cause of Action: Unjust Enrichment
Plaintiff does not allege sufficient facts for the
eighth cause of action because the law does not recognize unjust enrichment as
a cause of action, per se. “[T]here is
no cause of action in California for unjust enrichment.” (Melchior v. New Line Productions, Inc.
(2003) 106 Cal.App.4th 779, 793.)
“Unjust enrichment is ‘ “a general principle, underlying various legal
doctrines and remedies,” ’ rather than a remedy itself.” (Ibid.)
Plaintiff argues unjust enrichment is equivalent to
a “ ‘quasi-contract claim seeking restitution.’ ” (Opp., p. 11.) But, for “quasi-contractual recovery … it is well settled that there is no equitable
basis for an implied-in-law promise to pay reasonable value when the parties
have an actual agreement covering compensation.” (Hedging Concepts, Inc. v. First Alliance
Mortgage Co. (1996) 41 Cal.App.4th 1410, 1419.)
Motion to Strike
Defendant
FPI Management, Inc. moves to strike paragraphs 34-47 of the complaint and its
prayer for punitive and exemplary damages.
Paragraphs 34-47
Defendant moves to strike all paragraphs
under the sixth and seventh causes of action.
“Where a whole cause of action is the proper subject of a pleading
challenge, the court should sustain a demurrer to the cause of action rather
than grant a motion to strike.” (Quiroz
v. Seventh Ave. Center (2006) 140 Cal.App.4th 1256, 1281.) The court will sustain the demurrer to the
sixth and seventh causes of action. Striking
these paragraphs is unnecessary.
Prayer for Punitive Damages
The complaint does
not allege sufficient facts to recover punitive damages. Courts may strike a “demand for judgment
requesting relief not supported by the allegations of the complaint.” (Code Civ. Proc., § 431.10, subd.
(b)(3).)
Plaintiff’s claim
for punitive damages relies on its fraud claim.
Punitive damages are available “[i]n an action for the breach of an
obligation not arising from contract.”
(Civ. Code, § 3294, subd. (a).) The
court will sustain the demurrer to plaintiff’s causes of action for fraud and
negligent misrepresentation. The
remaining causes of action allege breach of an obligation arising from contract. They all arise from allegations that
defendant did not pay what it owed under the parties’ written agreement.
Plaintiff also
does not allege sufficient facts to make defendant FPI Management, Inc. liable
for punitive damages as a corporation. Civil
Code section 3294, subdivision (b) provides that for a corporate employer to be
liable for punitive damages, “the advance knowledge and conscious disregard [of
an employee’s unfitness], authorization, ratification or act of oppression,
fraud, or malice must be on the part of an officer, director, or managing agent
of the corporation.”
The complaint
alleges Joshua Moore committed the act of fraud. (Comp., ¶ 35.) It does not allege he was an officer,
director, or managing agent of FPI Management, Inc. Nor does it allege any officer, director, or
managing agent of FPI Management, Inc. knew Joshua Moore was unfit or authorized
or ratified Moore’s purported fraud.
Disposition
Defendant FPI Management, Inc.’s demurrer to plaintiff Mez, Inc.’s first through
fifth causes of action is overruled.
Defendant FPI
Management, Inc.’s demurrer to the sixth through eighth causes of action is sustained
with 20 days’ leave to amend.
Defendant FPI Management, Inc.’s motion to
strike is granted only as to the prayer for punitive damages. The court hereby strikes the following
portion of the complaint with 20 days’ leave to amend: “For punitive and
exemplary damages in an amount to be determined at time of trial.” (Comp., prayer ¶ 6, page 9, lines 3-4.)