Judge Bruce G. Iwasaki

Department 58

Hearing Date: January 13, 2025

Case Name: Golubski v. General Motors, LLC

Case No.: 24STCV08710

Matter: Demurrer to the First Amended Complaint and Motion to Strike

Moving Party: Defendant General Motors, LLC

Responding Party: Plaintiff Calon Golubski

Tentative Ruling: The Demurrer to the fifth cause of action in the First Amended Complaint is sustained. The Motion to Strike is granted.

On or about June 29, 2023, Plaintiff Calon Golubski (Plaintiff) purchased a 2023 Chevrolet Silverado 1500 (Vehicle). Plaintiff alleges that, at the time of the purchase, his Vehicle contained defects covered under the express warranty and that Defendant General Motors LLC (GM) failed to repair the Vehicle in compliance with the warranty. Plaintiff also claims that Defendant GM’s fraudulent conduct contributed to his decision to purchase the Vehicle.

On April 5, 2024, Plaintiff sued GM. The First Amended Complaint contains causes of action for breach of warranty claims under the Song-Beverly Act, and a fraud claim.

Defendant GM now demurs to the fifth cause of action for fraud. GM also moves to strike the request for punitive damages. Plaintiff opposes the demurrer and the motion to strike.

The Court sustains the demurrer with leave to amend. The motion to strike is granted.

Legal Standard for Demurrers

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.) In applying these standards, the court liberally construes the complaint to determine whether a cause of action has been stated. (Picton v. Anderson Union High School Dist. (1996) 50 Cal.App.4th 726, 733.)

Analysis

Fifth Cause of Action for Fraud:

Defendant GM argues that the fraudulent concealment claims contained within the fifth cause of action fails to state a claim. Defendant argues that the FAC does not state a claim because Plaintiff has not alleged fraud with the requisite specificity and the allegations are insufficient to demonstrate a duty to disclose.

The Complaint fails to allege facts sufficient to support fraudulent concealment.

Defendant contends that the FAC fails to allege (i) the identity of the salespersons who purportedly concealed material facts about his Vehicle, (ii) their authority to speak and act on behalf of GM, (iii) GM’s knowledge about alleged defects in Plaintiff’s Silverado at the time of purchase; (iv) any interactions with GM before or during the purchase of the Silverado, or (v) GM’s intent to induce reliance by Plaintiff to purchase the specific Silverado at issue and (iv). (Dem., 9:8-13.)

To state a claim for fraudulent inducement-concealment, Plaintiffs must allege: (1) the defendant “concealed or suppressed a material fact,” (2) the defendant was “under a duty to disclose the fact to the plaintiff,” (3) the defendant “intentionally concealed or suppressed the fact with the intent to defraud the plaintiff,” (4) the plaintiff was “unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact,” and (5) “as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” (BiglerEngler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 310-311.)

As a preliminary matter, Plaintiff adequately alleges reliance. (FAC ¶ 67 [“Had Plaintiff known that the Vehicle suffered from the Transmission Defect, Plaintiff would not have purchased the Vehicle.”]; 72.) Based on this material fact, the allegation claiming Defendant intended to induce reliance is adequate. (FAC ¶¶ 72-74.)

Also, Defendant GM’s argument that the concealment is not alleged with adequate specificity is also not well-taken.

The ordinary rule about pleading fraud with specificity is less demanding when the alleged fraud is concealing the truth. Ordinarily, “fraud must be pleaded specifically; general and conclusory allegations do not suffice.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.). “This particularity requirement necessitates pleading facts which show how, where, to whom, and by what means” the alleged fraud occurred. (Id.) The purpose of the particularity requirement is to “separate meritorious and nonmeritorious cases, if possible in advance of trial.” (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.)

Some cases, however, conclude that this standard is less stringent when the defendant already has “ ‘full information concerning the facts of the controversy.’ ” (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 217, superseded by statute on other grounds as stated in Californians for Disability Rights v. Mervyn's, LLC (2006) 39 Cal.4th 223, 227.) Relaxation of the specificity requirement is particularly appropriate in a concealment case. Unlike intentional misrepresentation, which requires some affirmative representation or promise, a fraudulent concealment is the absence of something, the suppression of a fact. (Civ. Code § 1710.)

This distinction was recognized in Turner v. Milstein (1951) 103 Cal.App.2d 651. In rejecting a demurrer based on uncertainty, the Turner court explained that the uncertainty doctrine does not apply when the facts are known by the demurring party:

The only specification of uncertainty was that it could not be determined how, or in what manner, Milstein concealed from plaintiff the time and place of the sale of the real property. The ultimate fact is pleaded. It is an old and elemental rule of pleading that a demurrer for uncertainty does not lie if what is sought is a statement of matter already within the knowledge of the demurring party.... If, in truth, Milstein concealed from plaintiff the fact that the property was to be sold, he knows it and he knows the time and place of concealment, if there was a time and place. It would seem that concealment is negative and that it would occur without any time or place. Milstein knows the facts.

(103 Cal.App.2d at p. 658.)

Thus, based on the nature of this type of claim, a plaintiff in a fraud by omission suit will not be able to specify the time, place, and specific content of an omission as precisely as would a plaintiff in a false representation claim. Here, the Court cannot conclude that the contents of the alleged concealment was not pleaded with the adequate level of specificity.

However, Defendant also argues that the FAC does not adequately allege facts showing a duty to disclose.

Absent a fiduciary relationship between the parties (which Plaintiff does not allege here), a duty to disclose can arise in only three circumstances: (1) the defendant had exclusive knowledge of the material fact; (2) the defendant actively concealed the material fact; or (3) the defendant made partial representations while also suppressing the material fact. (BiglerEngler, supra, 7 Cal.App.5th at p. 311; LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336.) The California Supreme Court “has described the necessary relationship giving rise to a duty to disclose as a ‘transaction’ between the plaintiff and defendant ….” (Bigler-Engler, supra, 7 Cal.App.5th at p. 311; Warner Construction Corp. v. City of Los Angeles (1970) 2 Cal.3d 285, 294 [“In transactions which do not involve fiduciary or confidential relations”]; Hoffman v. 162 North Wolfe LLC (2014) 228 Cal.App.4th 1178, 1187–89 [rejecting concealment claim where plaintiffs “were not involved in a transaction with the parties they claim defrauded them”]; LiMandri, supra, 52 Cal.App.4th at p. 337 [“such a relationship can only come into being as a result of some sort of transaction between the parties”].)

Defendant GM argues there are no facts alleged that would support a duty to disclose. The FAC contains no allegations of any direct dealing with GM. Instead, the FAC alleges Plaintiff visited and purchased the Vehicle from Wittmeier Chevrolet. (FAC ¶ 6.)

In opposition, Plaintiff argues that GM had exclusive knowledge of the Defective Transmission. In support, Plaintiff argues that the dealer’s warranty agreement with GM create a sufficient transactional relationship, citing Dhital v. Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 844. (Opp. 3:23-5-7.)

Dhital found that the plaintiffs’ statutory warranty claims under the Song-Beverly Act were the equivalent of contract claims for the purposes of determining whether the economic loss rule applies. This did not, however, establish a duty to disclose. (Dhital, 84 Cal. App. 5th at 838, fn. 3.) Only later in its decision did the Dhital court state that the plaintiffs’ allegations were sufficient to overcome the defendant's argument that there was no buyer-seller relationship giving rise to a duty to disclose. (Id. at 844.) The Dhital court explained that the plaintiffs sufficiently alleged that the requisite buyer-seller relationship existed because the plaintiffs had alleged that they bought the car from a Nissan dealership, Nissan backed the purchase with an express warranty, and Nissan's authorized dealerships are its agents for purposes of the sale of Nissan vehicles to customers. (Id.)

In this case, Plaintiff’s allegations are distinguishable because Plaintiff does not allege that he bought the Vehicle from a GM dealership. (FAC ¶ 31.) Although the FAC refers to Wittmeier Chevrolet as “GM’s authorized dealer” – this conclusory allegation is unsupported by any ultimate facts that the dealer was an agent in fact of Defendant. (See Avalon Painting Co. v. Alert Lumber Co. (1965) 234 Cal.App.2d 178, 184 [“A . . . dealer or retailer may in a layman’s view be an agent of the [auto manufacturer], but he is not an agent in the legal sense of that relationship”].)

Further, the FAC does not adequately allege GM’s exclusive knowledge of the Transmission Defect in the Vehicle that Plaintiff purchased. Although Plaintiff cites Paragraphs 62, 70a-70b -- these citations do not contain factual allegations – as opposed to conclusory statements – to support the exclusive knowledge about a Transmission Defect in Plaintiff’s specific Vehicle. (FAC ¶ 62.)

Similarly, Plaintiff’s argument that the allegations show active concealment of material facts by Defendant is not well taken. (Opp. 4:23-25 [citing Paragraphs 27, 29, 35-36, 64, 67-68, 71-72, 74, 76].) Like Plaintiff’s other allegations, these allegations are entirely conclusory and lacking ultimate facts.

Thus, Plaintiff has not pled a transactional relationship giving rise to a duty to disclose. This is a ground for sustaining the demurrer to the fifth cause of action.

Legal Standard for Motions 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.) “Immaterial” or “irrelevant” matters include allegations not essential to the claim, allegations neither pertinent to nor supported by an otherwise sufficient claim or a demand for judgment requesting relief not supported by the allegations of the complaint. (Code Civ. Proc., § 431.10, subds. (b)(1)-(3).)

Discussion

Punitive Damages Allegations

Defendant GM moves to strike the request for punitive damages in the FAC. Defendant argues, based on its demurrer arguments, Plaintiff lacks any viable fraud-based claims to support the punitive damage request. Further, even with the fraud claim, GM argues the allegations in the FAC do not satisfy the statutory standards required to seek punitive damages.

Punitive damages are recoverable where the defendant has been guilty of oppression, fraud, or malice, express or implied. (Civ. Code § 3294.) “Something more than the mere commission of a tort is always required for punitive damages. There must be circumstances of aggravation our outrage, such as spite or malice, or a fraudulent or evil motive on the part of the defendant, or such a conscious and deliberate disregard of the interests of others that his conduct may be called willful or wanton.” (Taylor v. Superior Court (1979) 24 Cal.3d 890, 894.) Specific intent to injure is not necessary for a showing of malice—it is sufficient that the defendant’s conduct was so “wanton or so reckless as to evince malice or conscious disregard of others’ rights.” (McConnell v. Quinn (1925) 71 Cal. App. 671, 682.)

A request for punitive damages that is not supported with specific allegations of oppression, fraud, or malice is subject to a motion to strike. Conclusory allegations that defendants acted “willfully,” “maliciously,” or with “oppression, fraud, or malice” are not, without more, sufficient to give rise to a claim for punitive damages, but such language is permissible where the complaint contains sufficient factual support for the conclusions. (Perkins v. Superior Court (1981) 117 Cal.App.3d 1, 6-7.)

Here, given the Court’s ruling sustaining the demurrer to the fifth causes of action, there is no underlying claim to support a request for punitive damages. The motion to strike the punitive damage allegations is granted.

Conclusion

The demurrer to the fifth cause of action is sustained. The motion to strike is granted. Plaintiff shall have leave to amend. An amended pleading shall be filed and served on or before February 13, 2025.