Judge: Bruce G. Iwasaki, Case: 22STCV04496, Date: 2023-02-16 Tentative Ruling

Case Number: 22STCV04496    Hearing Date: February 16, 2023    Dept: 58

Judge Bruce G. Iwasaki

Department 58

Hearing Date:             February 16, 2023

Case Name:                 Mirna Cuellar et al. v. Fok Family Trust, by May Fok, Trustee et al.

Case No.:                    22STCV04496

Motion:                       Demurrer w/motion to strike

Moving Party:             Defendant Fok Family Trust and May Fok

Tentative Ruling:      The Demurrer is sustained with 20 days leave to amend.  The motion to strike is granted.

Background

            Plaintiffs Mirna and Hector Cuellar sues Defendant May Fok in her personal capacity and as trustee of the Fok Family Trust for breach of contract and various Labor Code violations such as failure to pay minimum wage and waiting time penalties.  Mirna alleged that she worked as a property manager of the Property pursuant to a written agreement.  Hector alleged that he entered into an oral agreement to work forty hours per week and that Defendants have not paid him any of his wages.

            Defendants May Fok, individually and as trustee of the Fok Family Trust, demurs to the entire Second Amended Complaint (Complaint).  Plaintiff filed an opposition, but Defendants did not file a Reply.  Defendants’ counsel’s declaration satisfies the meet-and-confer requirement.  (Moss Decl., ¶¶ 3-4.) 

            Defendants also move to strike several lines in Paragraphs 2 and 10 of the Complaint that describe Plaintiff Mirna Cuellar’s contract with the Fok Family Trust.

Legal Standard

            A demurrer is an objection to a pleading, the grounds for which are apparent from either the face of the complaint or a matter of which the court may take judicial notice.  (Code Civ. Proc., § 430.30, subd. (a); see also Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)  The purpose of a demurrer is to challenge the sufficiency of a pleading “by raising questions of law.”  (Postley v. Harvey (1984) 153 Cal.App.3d 280, 286.)  “In the construction of a pleading, for the purpose of determining its effect, its allegations must be liberally construed, with a view to substantial justice between the parties.”  (Code Civ. Proc., § 452.)  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.) 

Discussion

First and seventh causes of action –breach of contract

Plaintiff Mirna Cuellar

            To state a claim for breach of contract, a plaintiff must allege sufficient facts to establish: (1) a contract between the parties; (2) plaintiff's performance or excuse for nonperformance; (3) defendant's breach; and (4) damages to plaintiff from the breach. (Wall Street Network, Ltd. v. New York Times Co. (2008) 164 Cal.App.4th 1171, 1178.)

            Defendants argue that the attached exhibit to the Complaint do not show that they are parties to the contract with Plaintiff Mirna Cuellar (Mirna).  Exhibit A to the Complaint is titled “Property Management Agreement” and is between “Cliff Fok,” who is described to be the “Owner,” and “Mirna Cuellar,” as “Manager.”  The “Fok Family Trust” is not mentioned anywhere in this document.  (See Prob. Code, § 18000, subd. (a) [“a trustee is not personally liable on a contract properly entered into in the trustee’s fiduciary capacity . . . unless the trustee fails to reveal the trustee’s representative capacity or identify the trust in the contract”].)[1]

            Plaintiffs argue that a contract in the name of an agent “ ‘may be enforced against an undisclosed principal.’ ”  They rely on Sterling v. Taylor (2007) 40 Cal.4th 757, 773.  Sterling is inapposite because that case involved a statute of frauds issue in the context of a motion for summary judgment, where “extrinsic evidence is admissible to identify the principal.”  Here, on a demurrer, the contract is clear that Cliff Fok is the other party. 

            It is true that Mirna alleged that she was “employed pursuant to a written contract with the Fok Family Trust, by Cliff Fok as trustee, as personal assistant to Cliff Fok.”  (Complaint, ¶ 2.)  But “[f]acts appearing in exhibits attached to a complaint will also be accepted as true and will be given precedence over any contrary allegations in the pleadings.”  (Banis Restaurant Design, Inc. v. Serrano (2005) 134 Cal.App.4th 1035, 1044-1045.)  Plaintiffs do not allege any alter ego, third-party beneficiary, or some other method in which the trust may be held liable.  (See, e.g., Goonewardene v. ADP, LLC (2019) 6 Cal.5th 817, 821 [discussing third party beneficiary doctrine].)

The demurrer is sustained with leave to amend.  Plaintiffs should specify the chain of subsequent and successor owners, as necessary.  

Plaintiff Hector Cuellar

Defendants contend that Plaintiff Hector Cuellar’s alleged damages are less than the minimum jurisdiction amount of $25,000.  This is unavailing.  “If any of several claims joined in the complaint exceeds $25,000, no part of the case is subject to the rules governing limited civil cases.”  (Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2022) ¶¶ 3:104.)  Here, it is sufficient that Mirna alleges that her damages are at least $110,000.  (Complaint, ¶¶ 21, 27; See Emery v. Pacific Employers Insurance Co. (1937) 8 Cal.2d 663, 667.)  The demurrer is overruled on the seventh cause of action.

Second through sixth causes of action – violation of minimum wage, overtime requirement, meal period requirement, wage statement requirement, and waiting time penalty

            As to these Labor Code violations, Defendants cite to the Probate Code for the proposition that a trustee can be “personally liable for obligations arising from ownership or control of trust property only if the trustee is personally at fault.”  (Prob. Code, § 18001.)  They argue there is no personal liability because May Fok and the Trust were not parties to the contract.  Plaintiffs respond that they are not seeking personal liability as to these claims.  If that is so, Plaintiffs should amend to sue May Fok in her capacity as trustee, not in her individual capacity.

            To the extent that these Labor Code violations arise from Mirna’s property management agreement with Cliff Fok, the demurrer is sustained with leave to amend. 

Motion to strike

“The court may, upon a motion made pursuant to Section 435, or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading. (b) Strike out 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.”¿ (Code Civ. Proc., § 436.)

Defendants seek to strike several lines in two paragraphs that relate to Plaintiff Mirna Cuellar alleging that she was employed pursuant to a written contract with the Fok Family Trust.  As the demurrer is sustained pursuant to the above reasoning, the motion to strike is granted.

Conclusion

            The demurrer is sustained with 20 days leave to amend to clarify the employer and chain of parties.  The motion to strike is granted.