Judge: Ashfaq G. Chowdhury, Case: 24GDCV00368, Date: 2024-08-08 Tentative Ruling
Case Number: 24GDCV00368 Hearing Date: August 8, 2024 Dept: E
Case No: 24GDCV00368
Hearing Date: 08/08/2024 – 8:30am
Trial Date: UNSET
Case Name: ALEKSANDRA TERTYCHNAI v. CALIFORNIA COMMUNITY
HOUSING AGENCY; GREYSTAR CALIFORNIA, INC.; DOUG VERBOON; RUSTY ROBINSON; JOE
NEVES; RICHARD VALLE; RICHARD FAGUNDES
[TENTATIVE RULING ON
DEMURRER AND MOTION TO STRIKE]
Moving Party: Defendants, California Community Housing Agency
and Greystar California, Inc.
Responding Party: Plaintiff,
Aleksandra Tertychnaia
Proof of Service
Timely Filed (CRC Rule 3.1300): Ok
16/21 Court Days Lapsed (CCP § 1005(b)): Ok
Proper Address: Ok
Moving Papers: Memo; Demurrer;
Notice; Chung Decl.; Proposed Order
Opposing Papers:
Opposition
Reply Papers: Reply
RELIEF REQUESTED
Defendants, California Community Housing Agency and Greystar California, Inc.,
demur to the causes of action in the SAC as follows:
1.
First cause of action (fraud, intentional misrepresentation) does not state
facts sufficient to constitute a cause of action (CCP § 430.10(e)) and pleading
is uncertain, ambiguous, and unintelligible (CCP §
430.10(f)).
2. Second cause of action (breach of fiduciary duty)
does not state facts sufficient to constitute a cause of action.
3. Third cause of action (breach of fiduciary duty)
does not state facts sufficient to constitute a cause of action.
4. Fourth cause of action (fraud, intentional
misrepresentation) does not state facts sufficient to constitute a cause of
action and the pleading is uncertain, ambiguous, and unintelligible.
5. Fifth cause of action (discriminatory action) does
not state facts sufficient to constitute a cause of action.
BACKGROUND
This
case involves a household that did not qualify for low-income housing because
they made too much money. Plaintiff and her husband Vitalli Tertychnyi
submitted to Greystar, the property manager, an Income Verification Form for
entry into the Essential Housing Program operated by the property owner, the
California Community Housing Agency (CalCHA). See Plaintiffs SAC, ,I 25. The
income provided by Plaintiff reflected that Plaintiffs household was
over-income and thus not eligible for the Essential Housing Program. In an
attempt to qualify, Plaintiff sought to provide tax returns that reflected a
lower household income and is now upset that Defendants did not consider the
tax returns. Plaintiff references a Regulatory Agreement as evidence that tax
returns should have been considered. See Plaintiffs SAC, Exhibit C. But the
Regulatory Agreement, in section 4( d), states the following:
The
Owner shall cause the Manager to verify that the income information provided by
an applicant in an Income Ce1iification is accurate by taking one or more of
the following steps as part of the verification process: (1) obtain pay stubs
for the three most recent pay periods, (2) obtain an income tax return for the
most recent tax year, (3) obtain a credit rep01i or conduct a similar type
credit search, ( 4) obtain an income verification from the applicant's current
employer, (5) obtain an income verification from the Social Security
Administration and/or the California Department of Social Services if the
applicant receives assistance from either of such agencies, or (6) if the
applicant is unemployed and does not have an income tax return, obtain another
form of independent verification reasonably acceptable to the Owner. Nothing in
this Regulatory Agreement shall prevent the Administrator or the Manager from
applying usual, customary and legal tenant eligibility criteria, including
without limitation, consideration as to whether an applicant has sufficient
income or other financial resources from which to pay rent.
Defendants
followed the Regulatory Agreement and took pay stubs that reflected that
Plaintiffs household was over-income and thus not eligible for the Essential
Housing Program.
California's
Civil Rights Department has already investigated the sum and substance of this
matter and closed the case. See Plaintiffs SAC, ¶¶ 31-32. However, Plaintiff
has filed this matter in Los Angeles County Superior Court alleging many of the
same claims. In her SAC, Plaintiff asserts two claims of fraud by intentional
misrepresentation, two claims of breach of fiduciary duty, 2 and one claim of
discriminatory action.
PROCEDURAL
Meet
and Confer
A party filing a
demurrer “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 parties
shall meet and confer at least five days before the date the responsive
pleading is due. If the parties are not able to meet and confer at least five
days prior to the date the responsive pleading is due, the demurring party
shall be granted an automatic 30-day extension of time within which to file a
responsive pleading, by filing and serving, on or before the date on which a
demurrer would be due, a declaration stating under penalty of perjury that a
good faith attempt to meet and confer was made and explaining the reasons why
the parties could not meet and confer.”
(Code Civ. Proc., §430.41, subd. (a)(2).) Failure to sufficiently meet and
confer is not grounds to overrule or sustain a demurrer. (Id., §430.41(a)(4).)
Here,
Defendants’ counsel, Daniel Chung, states that a meet and confer occurred but
no resolution was met. (See Chung Decl. ¶ 4.)
LEGAL STANDARDS FOR DEMURRERS
Demurrer
– Sufficiency
A demurrer for
sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda, (2007) 147 Cal.App.4th
740, 747.) When considering demurrers,
courts read the allegations liberally and in context. (Taylor v. City of Los Angeles Dept. of
Water and Power (2006) 144 Cal.App.4th 1216, 1228.) The court “treat[s] the demurrer as admitting
all material facts properly pleaded, but not contentions, deductions or
conclusions of fact or law ….” (Berkley
v. Dowds (2007) 152 Cal.App.4th 518, 525.)
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 pleadings
alone and not the evidence or other extrinsic matters; therefore, it lies only
where the defects appear on the face of the pleading or are judicially
noticed. (Code Civ. Proc., §§ 430.30,
430.70.) The only issue involved in a
demurrer hearing is whether the complaint, as it stands, unconnected with
extraneous matters, states a cause of action. (Hahn, supra, 147
Cal.App.4th at 747.)
The
general rule is that the plaintiff need only allege ultimate facts, not
evidentiary facts. (Doe v. City of
Los Angeles (2007) 42 Cal.4th 531, 550.)
“All that is required of a plaintiff, as a matter of pleading … is that
his complaint set forth the essential facts of the case with reasonable
precision and with sufficient particularity to acquaint the defendant with the
nature, source and extent of his cause of action.” (Rannard v. Lockheed Aircraft Corp.
(1945) 26 Cal.2d 149, 156-157.)
On
demurrer, a trial court has an independent duty to “determine whether or not
the … complaint alleges facts sufficient to state a cause of action under any
legal theory.” (Das v. Bank of
America, N.A. (2010) 186 Cal.App.4th 727, 734.) Demurrers do not lie as to only parts of
causes of action, where some valid claim is alleged but “must dispose of an
entire cause of action to be sustained.”
(Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97,
119.) “Generally
it is an abuse of discretion to sustain a demurrer without leave to amend if
there is any reasonable possibility that the defect can be cured by
amendment.” (Goodman v. Kennedy
(1976) 18 Cal.3d 335, 349.)
Demurrer – Uncertainty
A special demurrer for uncertainty, CCP section
430.10(f), is disfavored and will only be sustained where the pleading is so
bad that defendant cannot reasonably respond—i.e., cannot reasonably determine
what issues must be admitted or denied, or what counts or claims are
directed against him/her. (Khoury v. Maly’s of Calif., Inc. (1993)
14 Cal.App.4th 612, 616.) Moreover, even if the pleading is somewhat
vague, “ambiguities can be clarified under modern discovery procedures.” (Ibid.)
ANALYSIS
Preliminary
Matter
As a preliminary matter,
the moving, opposing, and reply papers are difficult to understand because on
several occasions both parties make arguments/conclusions and don’t cite legal
authority to support their arguments/conclusions.
For
contextual purposes for this entire tentative ruling, Plaintiff alleges that
Defendant Greystar California, Inc. (Greystar) is doing business in Los Angeles
County, California. (SAC ¶ 2.) Plaintiff also alleges that Defendant California
Community Housing Agency (CalCHA) is doing business in Los Angeles, County,
California. (SAC ¶ 3.) Further, Plaintiff alleges that the CalCHA is a joint
powers agency created in January 2019 to provide housing for low and moderate
income households by issuing tax-exempt government bonds to acquire existing
market-rate apartment complexes. (SAC ¶ 12.)
Further,
Plaintiff alleges that Greystar is a Property Management Company of Next on
Lex, and that since September of 2019 Plaintiff has been a resident of Next on
Lex. (See Compl. ¶¶ 18 & 21.)
First Cause of Action – Fraud Intentional Misrepresentation
The first cause of
action is alleged against Defendants Greystar California, Inc. (Greystar) and
California Community Housing Agency (CalCHA).
CalCHA
first cites to Government Code § 815. “Except as otherwise provided by statute:
(a) A public entity is not liable for an injury, whether such injury
arises out of an act or omission of the public entity or a public employee or
any other person.” (Gov. Code § 815(a).)
Defendant
then cites to case law and other portions of the Government Code to argue that
Plaintiff fails to identify with particularity the statute that gives rise to
this cause of action against CalCHA.
In
relevant part of Searcy v. Hemet Unified School District:
Secondly, in California all government tort liability is dependent
on the existence of an authorizing statute or “enactment” (Gov. Code, §
815, subd. (a), 815.6; Tolan v. State of California ex
rel. Dept. of Transportation, supra., 100 Cal.App.3d
980, 983; Morris v. State of California, supra., 89
Cal.App.3d 962, 964; Susman v. City of Los Angeles (1969) 269
Cal.App.2d 803, 808 [75 Cal.Rptr. 240]), and to state a cause of
action every fact essential to the existence of statutory liability must be
pleaded with particularity, including the existence of a statutory duty.
( Susman v. City of Los Angeles, supra., 269 Cal.App.2d
803, 809.) Duty cannot be alleged simply by stating “defendant had a duty under
the law”; that is a conclusion of law, not an allegation of fact. The facts
showing the existence of the claimed duty must be alleged. (Id.; see
also Rubinow v. County of San Bernardino (1959) 169 Cal.App.2d
67, 71 [336 P.2d 968].) Since the duty of a governmental agency can
only be created by statute or “enactment,” the statute or “enactment” claimed
to establish the duty must at the very least be identified.
(Searcy v. Hemet Unified School Dist. (1986)
177 Cal.App.3d 792, 802.)
“Fraud is an intentional tort[.]” (City of
Atascadero v. Merril Lynch, Pierce, Fenner & Smith, Inc. (1998) 68
Cal.App.4th 445, 482.)
Defendant
also cites to Government Code § 818.8 which states, “A public entity is not
liable for an injury caused by misrepresentation by an employee of the public
entity, whether or not such misrepresentation be negligent or intentional.”
(Gov. Code § 818.8.)
The
Court has several problems with CalCHA’s arguments, and it has several problems
with Plaintiff’s arguments in Opposition. The Court will explain those
problems.
First,
while the citation to Searcy seems to be persuasive to the extent that Plaintiff
did not allege the existence of the statutory duty that forms the basis to hold
CalCHA liable, CalCHA conclusorily argues that CalCHA is a public entity.
CalCHA comes to this conclusion simply by referring to paragraphs 12-16 of the
SAC.
“The
California Community Housing Agency (CalCHA) is a joint powers agency created
in January 2019 to provide housing for low and moderate income households by
issuing tax-exempt government bonds to acquire existing market-rate apartment
complexes.” (SAC ¶ 12.)
CalCHA
thus concludes “CalCHA is a joint powers agency and is thus a public entity.”
(Def. Memo. p. 3.)
The
problem with this argument is that CalCHA provides no legal authority as to
what is considered a public entity. Further CalCHA provides no legal authority
that supports its argument that when a complaint alleges that a defendant is a
joint powers agency, this means that the defendant is a public entity for the
purposes of the government code.
Therefore,
even if CalCHA’s argument about the SAC not alleging the statutory authority
with enough particularity is correct, the Court does not find CalCHA’s argument
persuasive that CalCHA is a public entity when CalCHA provided no legal
authority for its argument and when the SAC does not allege that CalCHA is a
public entity.
Or
to phrase it differently, CalCHA asserts several arguments with respect to the
Government Code, but CalCHA bases these arguments on its own self-serving
conclusion and assumption that the Government Code is applicable because CalCHA
is a public entity. The SAC did not allege CalCHA to be a public entity.
All
that being said, the Opposition is equally unpersuasive.
Despite
CalCHA seeming to assume and conclude CalCHA is a public entity for purposes of
the Government Code, in Opposition, Plaintiff does not address any of the
arguments that CalCHA brought up.
Plaintiff
cites to Government Code § 814 which states, “Nothing in this part affects
liability based on contract or the right to obtain relief other than money or
damages against a public entity or public employee.” (Ibid.) Plaintiff argues
that § 814 clarifies that Government Code § 815 does not apply to contracts.
“The doctrine of sovereign immunity has not protected public entities in California from liability
arising out of contract. This section makes clear that this
statute has no effect on the contractual liabilities of public entities or
public employees.” (Arthur L. Sachs, Inc. v.
City of Oceanside (1984) 151 Cal.App.3d 315, 320.)
Tentative Ruling First Cause of Action
with Respect to CalCHA
The
Court will hear argument.
While CalCHA provided no legal authority as to
CalCHA being a public entity and thus no legal authority as to why the
Government Code applies here, confusingly, in Opposition, Plaintiff almost
seems to concede that CalCHA is a public entity by also citing to the
Government Code in Opposition to argue that § 814 allows Plaintiff to hold
CalCHA liable. Therefore, if Plaintiff is conceding that CalCHA is a public
entity, then it would appear that CalCHA’s argument about Plaintiff not
alleging the statutory basis with enough particularity to hold CalCHA liable
would be availing.
Further, if we assume Government Code § 814 applies
for the sake of Plaintiff’s argument, the problem is that § 814 references
liability based on contract. Here, Plaintiff’s fraud intentional
misrepresentation cause of action is not based on contract. It is based on the
tort of fraud intentional misrepresentation. “Fraud is an intentional tort[.]”
(City of Atascadero v. Merril Lynch, Pierce, Fenner & Smith, Inc. (1998)
68 Cal.App.4th 445, 482.)
Therefore, Plaintiff does not allege a breach of
contract cause of action even if it as arguing that Government Code § 814
applies.
Government Code § 818.8 states, “A public entity is
not liable for an injury caused by misrepresentation by an employee of the
public entity, whether or not such misrepresentation be negligent or
intentional.” (Gov. Code § 818.8.)
Further, if Plaintiff is conceding that CalCHA is a
public entity, and considering
Plaintiff is not alleging a breach of contact cause of action, it seems as if §
818.8 would potentially bar the action.
Further, as will be explained with respect to
Greystar, Plaintiff also appears to not allege the specificity requirements set
forth in Fritz.
First Cause of Action – Greystar
Greystar’s
first argument in its memorandum on page 4, lines 15-25, does not address
pleading requirements. This demurrer hearing has nothing to do with “establishing”
a false representation, it deals with what the SAC alleges.
Greystar argues that it is unclear which
representation is being alleged as false. In Opposition, Plaintiff argues that
the absence of an “s” at the end of the word “representation” in SAC ¶ 46 and ¶
124 does not make the SAC unclear to the Defendants and that the Plaintiff was
referring to all of the enumerated representations.
Legal
Standard Fraud Intentional Misrepresentation
“ ‘The elements of fraud, which gives rise to the tort action for deceit,
are (a) misrepresentation (false representation, concealment, or
nondisclosure); (b) knowledge of falsity (or “scienter”); (c) intent to
defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting
damage.’ “ (Small v. Fritz Companies, Inc. (2003) 30Cal.4th 167, 173 citing Lazar v. Superior Court (1996)
12 Cal.4th 631, 638.)
(1)
Misrepresentation
Fraud must be pleaded with specificity rather than
with “‘general and conclusory allegations.’” (Small v. Fritz Companies, Inc.
(2003) 30 Cal.4th 167, 184. (Fritz.))
The specificity requirement means a plaintiff must allege facts showing how,
when, where, to whom, and by what means the representations were made, and, in
the case of a corporate defendant, the plaintiff must allege the names of the
persons who made the representations, their authority to speak on behalf of the
corporation, to whom they spoke, what they said or wrote, and when the
representation was made. (Lazar v. Superior Court (1996)12 Cal.4th 631,
645.)
Plaintiff alleges:
43. On or about July 1, 2021 Holly
Savant, who is the agent and employee of Defendant Greystar, made the following
representation to Plaintiff: She stated that Plaintiff need to provide Form of
Income Certification to determine eligibility.
44. On or about July 1, 2021 Holly
Savant, who is the agent and employee of Defendant Greystar, made the following
representation to Plaintiff: She stated that Plaintiff did not need to provide
any other document to determine eligibility.
(SAC ¶¶ 43-44.)
In relevant part of
the SAC, the SAC also alleges that “The representation made by Defendant
Greystar was in fact false.” (SAC ¶ 46.)
The Court notes that
throughout the entire first cause of action in the SAC, Plaintiff only refers
to “representation” as opposed to “representations.”
Tentative Ruling First cause of Action as to Greystar
The
Court is hesitant to sustain Greystar’s demurrer based on the difference
between the word “representation” and “representations.”
A special demurrer for uncertainty, CCP § 430.10(f),
is disfavored and will only be sustained where the pleading is so bad that
defendant cannot reasonably respond—i.e., cannot reasonably determine what
issues must be admitted or denied, or what counts or claims are
directed against him/her. (Khoury v. Maly’s of Calif., Inc. (1993)
14 Cal.App.4th 612, 616.) Moreover, even if the pleading is somewhat
vague, “ambiguities can be clarified under modern discovery procedures.” (Ibid.)
Greystar argues that it is unclear which
representation is being alleged as false. Opposition argues that the SAC was
referring to all of the representations to be false. However, the problem with
Plaintiff’s argument is that the SAC does not allege as such.
Either way, considering that both parties either
bring up arguments that are not on point and both fail on multiple occasions to
cite legal authority for their arguments, the Court refers the parties to the
legal standard it cited above in Fritz.
Plaintiff did not allege the specificity requirements for a fraud intentional
misrepresentation cause of action. Plaintiff did not allege how, where, and by
what means the representations were made.
Additionally, the demurrer to the first cause of
action with respect to CalCHA, setting aside the public entity issues, it also
appears as if it could be sustained for not meeting the particularity
requirements of Fritz.
TENTATIVE RULING FOURTH CAUSE OF ACTION
– Fraud Intentional Misrepresentation
As
to the fourth cause of action for fraud by intentional misrepresentation, it is
alleged against Greystar and CalCHA.
While this cause of action is based on different
representations than the first cause of action, the moving and opposing parties
make the same exact arguments they made with respect to the first cause of
action.
Therefore, the Court will do the same with the
fourth cause of action as it does with the first cause of action—which will depend
on the arguments the parties present at the hearing.
Second and Third Causes of Action –
Breach of Fiduciary Duty
As a preliminary matter, CalCHA argues that it is a
public entity and Plaintiff fails to identify with particularity the statute
that gives rise to this cause of action against CalCHA. CalCHA appears to be
referring to the same exact arguments the Court mentioned in the first cause of
action with respect to the government code, public entities, immunity, and
identifying with particularity the statutory basis for which Plaintiff intends
to hold Defendant liable.
As stated in O’Neal:
“The elements of a
claim for breach of fiduciary duty are (1) the existence of a fiduciary
relationship, (2) its breach, and (3) damage proximately caused by that
breach.” (Mendoza v. Continental Sales Co. (2006) 140 Cal.App.4th
1395, 1405, 45 Cal.Rptr.3d 525.) Although subject to exceptions, the
determination whether a breach of fiduciary duty occurs under a particular set
of facts is “ ‘mainly for the trier of facts.’ ” (Mueller v. MacBan (1976)
62 Cal.App.3d 258, 276, 132 Cal.Rptr. 222; see Marzec v. Public
Employees’ Retirement System (2015) 236 Cal.App.4th 889, 915, 187
Cal.Rptr.3d 452 [“ ‘Whether a fiduciary duty exists is generally a
question of law. [Citation.] Whether the defendant breached that duty towards
the plaintiff is a question of fact. [Citation.]’ ”]; Harvey
v. The Landing Homeowners Assn. (2008) 162 Cal.App.4th 809, 822, 76
Cal.Rptr.3d 41 [“Breach of duty is usually a fact issue for the jury.
[Citation.] Breach may be resolved as a matter of law, however, if the
circumstances do not permit a reasonable doubt as to whether the defendant's
conduct violates the degree of care exacted of him or her.”].) Expert testimony
demonstrating a breach is not required, but is admissible in circumstances
where the conduct supporting the alleged breach is beyond common knowledge.
(See Stanley v. Richmond (1995) 35 Cal.App.4th 1070, 1087, 41
Cal.Rptr.2d 768.)
(O’Neal v.
Stanislaus County Employees’ Retirement Assn. (2017) 8. Cal.App.5th 1184, 1215.)
Further, as stated in Wolf v. Superior Court:
A fiduciary relationship is “ ‘any
relation existing between parties to a transaction wherein one of the parties
is in duty bound to act with the utmost good faith for the benefit of the other
party. Such a relation ordinarily arises where a confidence is reposed by one
person in the integrity of another, and in such a relation the party in whom
the confidence is reposed, if he voluntarily accepts or assumes to accept the
confidence, can take no advantage from his acts relating to the interest of the
other party without the latter's knowledge or consent....’ ” (Herbert
v. Lankershim (1937) 9 Cal.2d 409, 483, 71 P.2d 220; In re
Marriage of Varner (1997) 55 Cal.App.4th 128, 141, 63 Cal.Rptr.2d
894; see also Rickel v. Schwinn Bicycle Co. (1983) 144
Cal.App.3d 648, 654, 192 Cal.Rptr. 732 [“ ‘A “fiduciary relation” in
law is ordinarily synonymous with a “confidential relation.” It is ... founded
upon the trust or confidence reposed by one person in the integrity and fidelity
of another, and likewise precludes the idea of profit or advantage resulting
from the dealings of the parties and the person in whom the confidence is
reposed.’ ”].)
Traditional examples of fiduciary
relationships in the commercial context include trustee/beneficiary, directors
and majority shareholders of a corporation, business partners, joint
adventurers, and agent/principal. (See, e.g., Evangelho v. Presoto (1998)
67 Cal.App.4th 615, 621, 79 Cal.Rptr.2d 146 [trustee and
beneficiary]; Jones v. H.F. Ahmanson & Co. (1969) 1 Cal.3d
93, 108–109, 81 Cal.Rptr. 592, 460 P.2d 464 [controlling shareholder of
corporation]; April Enterprises, Inc. v. KTTV (1983) 147
Cal.App.3d 805, 818–819, 195 Cal.Rptr. 421 [joint adventurers]; Michelson
v. Hamada (1994) 29 Cal.App.4th 1566, 1580, 36 Cal.Rptr.2d
343 [agent/principal].)
Inherent in each of these relationships
is the duty of undivided loyalty the fiduciary owes to its beneficiary,
imposing on the fiduciary obligations far more stringent than those required of
ordinary contractors. As Justice Cardozo observed, “Many forms of conduct
permissible in a workaday world for those acting at arm's length, are forbidden
to those bound by fiduciary ties. A trustee is held to something stricter than
the morals of the marketplace. Not honesty alone, but the punctilio of an honor
the most sensitive is then the standard of behavior.” (Meinhard v.
Salmon (1928) 249 N.Y. 458, 164 N.E. 545, 546.)
(Wolf v. Superior Court (2003) 107
Cal.App.4th 25, 29-30.)
TENTATIVE RULING Second and Third Causes
of Action
The
Court will hear argument.
Tentative
Ruling Fifth Cause of Action – Discriminatory Action
Defendants’
demurrer to the fifth cause of action is OVVERRULED. Defendants provide no
legal authority to support their arguments as to this cause of action.
MOTION TO STRIKE
MOTION 2 – Motion to Strike
Moving
Party: Defendants, CalCHA and Greystar
Responding Party: Plaintiff, Aleksandra Tertychnaia
Proof of Service
Timely Filed (CRC Rule 3.1300) : Ok
16/21 Court Days Lapsed (CCP § 1005(b)): Ok
Proper Address: Ok
Moving Papers: Motion
to Strike; Proposed Order; Notice; Chung Declaration; Memorandum
Opposition Papers:
Opposition
Reply Papers: Reply
RELIEF REQUESTED
Defendants,
CalCHA and Greystar, move to strike ¶66 and ¶ 135 of the SAC as it relates to
Defendants CalCHA and Greystar.
PROCEDURAL
Meet
and Confer
Before filing a motion to strike pursuant to
this chapter, the moving party shall meet and confer in person or by telephone
with the party who filed the pleading that is subject to the motion to strike
for the purpose of determining if an agreement can be reached that resolves the
objections to be raised in the motion to strike. If an amended pleading is
filed, the responding party shall meet and confer again with the party who
filed the amended pleading before filing a motion to strike the amended
pleading. (CCP §435.5(a).)
Defendants’ counsel,
Daniel Chung, alleged a meet and confer, but a resolution was not met between
the parties. (See Chung Decl. ¶ 4.)
Legal Standard Motion to Strike
The grounds for moving to strike must appear on
the face of the pleading or by way of judicial notice. (Code. Civ. Proc.
§ 437; Turman v. Turning Point of Central California, Inc. (2010)
191 Cal.App.4th 53, 63 [“judges read allegations of a pleading subject to a
motion to strike as a whole, all parts in their context, and assume their
truth”].)
Further, CCP § 431.10(a)-(c) states as follows:
(a) A material
allegation in a pleading is one essential to the claim or defense and which
could not be stricken from the pleading without leaving it insufficient as to
that claim or defense.
(b) An immaterial
allegation in a pleading is any of the following:
(1) An allegation
that is not essential to the statement of a claim or defense.
(2) An allegation
that is neither pertinent to nor supported by an otherwise sufficient claim or
defense.
(3) A demand for
judgment requesting relief not supported by the allegations of the complaint or
cross-complaint.
(c) An “immaterial
allegation” means “irrelevant matter” as that term is used in Section 436.
(CCP §431.10(a)-(c).)
ANALYSIS
Punitive Damages
In an action for the breach of an
obligation not arising from contract, where it is proven by clear and
convincing evidence that the defendant has been guilty of oppression, fraud, or
malice, the plaintiff, in addition to the actual damages, may recover damages
for the sake of example by way of punishing the defendant. (Cal. Civ. Code
§3294(a).) “‘Malice’ means conduct
which is intended by the defendant to cause injury to the plaintiff or
despicable conduct which is carried on by the defendant with a willful and
conscious disregard of the rights or safety of others.” (CCP §3294(c)(1).)
“‘Oppression’ means despicable conduct that subjects a person to cruel and
unjust hardship in conscious disregard of that person’s rights. (CCP
§3294(c)(2).) “‘Fraud’ means an intentional misrepresentation, deceit, or
concealment of a material fact known to the defendant with the intention on the
part of the defendant of thereby depriving a person of property or legal rights
or otherwise causing injury. (CCP §3294(c)(3).)
“In order to survive a motion to strike
an allegation of punitive damages, the ultimate facts showing an entitlement to
such relief must be pled by a plaintiff.” (Clauson v. Superior Court
(1998) 67 Cal. App. 4th 1253, 1255.) Conclusory allegations, devoid of any
factual assertions, are insufficient to support a conclusion that parties acted
with oppression, fraud or malice. (Smith v. Sup. Ct. (1992) 10 Cal. App.
4th 1033, 1042.)
TENTATIVE RULING
Paragraph 66 of the SAC states, “The aforementioned conduct of
Defendant was an intentional, so as to justify an award of exemplary and
punitive damages.”
Paragraph 135 of the SAC states, “The aforementioned
conduct of Defendant was an intentional, so as to justify an award of exemplary
and punitive damages.”
The requests for punitive damages in ¶¶ 66 and 135 are
located in the fraud causes of action, which are both only alleged against
Greystar and CalCHA.
Defendants cite Government Code § 818. “Notwithstanding
any other provision of law, a public entity is not liable for damages awarded
under Section 3294 of the Civil Code or other damages imposed primarily for the
sake of example and by way of punishing the defendant.”
CalCHA argues that because it is a public entity it
cannot be held liable for punitive damages.
In Opposition, Plaintiff states, “Plaintiff is agree
with Defendant’s strike punitive damages for CalCHA.” (Oppo. p. 2.)
Defendants’ motion to strike ¶ 66 of the SAC is
GRANTED as to both CalCHA and Greystar.
Defendants’ motion to strike ¶ 135 is also GRANTED.
As the Court previously stated, whether or not the
Government Code is applicable, Plaintiff did not successfully allege a cause of
action for fraud intentional misrepresentation as to either CalCHA or Greystar
based on the specificity requirements in Fritz.