Judge: Carolyn M. Caietti, Case: 37-2023-00012022-CU-BC-CTL, Date: 2024-01-05 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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HALL OF JUSTICE

TENTATIVE RULINGS - January 04, 2024

01/05/2024  10:30:00 AM  C-70 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Carolyn Caietti

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Civil - Unlimited  Breach of Contract/Warranty Demurrer / Motion to Strike 37-2023-00012022-CU-BC-CTL IGOLF INC VS ALLIED EQUITY LLC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Motion to Strike, 05/31/2023

Defendants Allied Equity LLC, Cornerstone Management, LLC and Donna Nelson's Demurrer to Complaint is SUSTAINED IN PART WITH LEAVE TO AMEND (as to the first, third, fourth, fifth cause of action against Cornerstone Management, LLC and Donna Nelson and sixth causes of action) and OVERRULED IN PART (as to the second cause of action and fifth cause of action against Allied Equity LLC).

Defendants Allied Equity LLC, Cornerstone Management, LLC and Donna Nelson's Motion to Strike the Complaint is OFF CALENDAR as moot in light of the ruling on the demurrer.

Demurrer A demurrer can be used only to challenge defects that appear on the face of the pleading under attack; or from matters outside the pleading that are judicially noticeable. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) No other extrinsic evidence can be considered (i.e., no 'speaking demurrers'). (Ion Equip. Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881.) The complaint must be liberally construed and given a reasonable interpretation, with a view to substantial justice between the parties. (Amarel v. Connell (1988) 202 Cal.App.3d 137, 140–141; see also, Poseidon Development, Inc. v. Woodland Lane Estates, LLC (2007) 152 Cal.App.4th 1106, 1111-12 [in ruling on demurrers, courts treat as being true 'not only the complaint's material factual allegations, but also facts that may be implied or inferred from those expressly alleged'].) First Cause of Action – Fraud; Third Cause of Action – Negligent Misrepresentation; Fourth Cause of Action – Intentional Misrepresentation To plead a cause of action for fraud, plaintiffs must allege: (i) misrepresentation (false representation, concealment, or nondisclosure); (ii) knowledge of falsity (or 'scienter'); (iii) intent to defraud, i.e., to induce reliance; (iv) justifiable reliance; and (v) resulting damage. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.) Each element 'must be pled specifically; general and conclusory allegations do not suffice.' (Id., at p. 645.) Accordingly, plaintiffs must plead facts which 'show how, when, where, to whom, and by what means the representations were tendered.' (Ibid.) The first, third and fourth causes of action do not state sufficient facts to constitute fraud, negligent misrepresentation and intentional misrepresentation and are uncertain. (C.C.P., § 430.10(e), (f).) The Calendar No.: Event ID:  TENTATIVE RULINGS

2980275  44 CASE NUMBER: CASE TITLE:  IGOLF INC VS ALLIED EQUITY LLC [IMAGED]  37-2023-00012022-CU-BC-CTL claims are not plead with particularity as required for fraud claims. (Daniels v. Select Portfolio Servicing, Inc. (2016) 246 Cal.App.4th 1150, 1166, disapproved of on other grounds by Sheen v. Wells Fargo Bank, N.A. (2022) 12 Cal.5th 905, 948.) For example on the first cause of action, the Complaint alleges Defendants 'intentionally misrepresented to L1 that the Premises was in a certain condition and would be in that condition for the term of the Lease.' (Complaint, at ¶ 39.) The Complaint does not describe the 'certain condition.' But in opposition, Plaintiff takes a contradictory position and argues the misrepresentation was in Nelson affirming the source of the flood. This also makes the pleading confusing. The first cause of action is also confusing because it raises elements of a false promise theory. (See, Complaint, at ¶¶ 41-42, 59-60, 70.) In opposition, Plaintiff does not clarify whether it is pursuing false promise, which is a subspecies of the action for fraud and deceit. (Lazar, supra, 12 Cal.4th at p. 638.) In addition, Plaintiff does not differentiate between the defendants, nor identify what each defendant represented. This also becomes important as to the entity-defendants. To assert a cause of action for fraud against a corporation, a plaintiff must allege the name of the person who allegedly made the fraudulent representation, his or her authority to speak, to whom he or she spoke, what was said and when it was said. (Kalnoki v. First American Trustee Servicing Solutions, LLC (2017) 8 Cal.App.5th 23, 35.) Plaintiff did not do that here.

Similarly, the third cause of action alleges Defendants 'had no reasonable grounds for believing the representations made to Plaintiff regarding the Premises' without further specifying what the representations were. (Complaint, at ¶ 59.) Thus, the demurrer to the first, third and fourth causes of action are SUSTAINED WITH LEAVE TO AMEND.

Second Cause of Action: Negligence The second cause of action states sufficient facts to constitute negligence. Defendants rely on an exculpatory clause found in section 8.8 of the lease and the cases of Fritelli, Inc. v. 350 North Canon Drive, LP (2011) 202 Cal.App.4th 35 and Garcia v. D/AQ Corp. (2020) 57 Cal.App.5th 902, 905. In both cases, the courts reviewed summary judgment rulings and acknowledged whether an exculpatory clause covers a given case turns primarily on contractual interpretation, which requires an inquiry into the circumstances of the damage or injury and the language of the contract; 'each case will turn on its own facts.' (Fritelli, Inc., supra, at p. 44; Garcia, supra, at p. 908.) Defendants did not assess any of these factual issues or sufficiently show how it makes the Complaint devoid of sufficient facts.

The Complaint also does not show on its face how the second cause of action is time-barred. A demurrer based on a statute of limitations 'will not lie where the action may be, but is not necessarily, barred.' (Geneva Towers Ltd. Partnership v. City of San Francisco (2003) 29 Cal.4th 769, 781.) In order for the bar of the statute of limitations to be raised by demurrer, the defect must clearly and affirmatively appear on the face of the complaint; it is not enough that the complaint shows that the action may be barred. (Ibid.) Here, Plaintiff alleges several acts of negligence occurring within the three-year statute of limitations. (E.g., Complaint, at ¶¶ 23(b)-(w).) Defendants also have not met its burden to show how Donna Nelson did not owe a duty to Plaintiff. No legal authority is offered in support except for a general statement that a duty of care is an essential prerequisite of a negligence cause of action.

Thus, the demurrer to the second cause of action is OVERRULED.

Fifth Cause of Action: Breach of Contract The elements of a breach of oral contract cause are: '(1) existence of the contract; (2) plaintiff's performance or excuse for nonperformance; (3) defendant's breach; and (4) damages to plaintiff as a result of the breach.' (Aton Center, Inc. v. United Healthcare Ins. Co. (2023) 93 Cal.App.5th 1214, 1230.) Calendar No.: Event ID:  TENTATIVE RULINGS

2980275  44 CASE NUMBER: CASE TITLE:  IGOLF INC VS ALLIED EQUITY LLC [IMAGED]  37-2023-00012022-CU-BC-CTL Here, the fifth cause of action sufficiently states facts to constitute a breach of contract against Allied.

(E.g., Complaint, at Ex. A & ¶¶ 17, 80.) However, there are no facts alleged to show Defendants Cornerstone Management, LLC and Donna Nelson entered into a contract with Plaintiff. (Cf., ¶ 10 ['Allied entered into a Lease agreement with L1...'].) Plaintiff argues the lease was executed by Defendants Cornerstone Management, LLC and Nelson as a broker, but this does not show how they entered into a contract with Plaintiff.

As to Defendant Allied Equity, LLC, Defendants have not met their burden the Complaint fails to state sufficient facts as none of the elements of a breach of contract are addressed. Rather, Defendants focus on Plaintiff's remedies. (Memo., at p. 9:21-22 ['Plaintiff must look solely to the Remedies set forth in the Complaint, which it has failed to do.'].) But without showing how the Complaint fails to state a claim.

Sufficient facts are alleged to constitute a breach of contract. (Aton Center, Inc., supra; Complaint, at ¶¶ 17-21, 80-84.) Thus, the demurrer to the fifth cause of action is SUSTAINED IN PART WITH LEAVE TO AMEND as to Defendants Cornerstone Management, LLC and Donna Nelson and OVERRULED IN PART as to Defendant Allied Equity, LLC.

Sixth Cause of Action – Unlawful Business Practices The demurrer to the sixth cause of action is SUSTAINED WITH LEAVE TO AMEND. A UCL plaintiff must plead and prove the defendant engaged in a business practice that was either unlawful (forbidden by law), unfair (harm to the victim outweighs any benefit), or fraudulent (likely to deceive members of the public). (Albillo v. Intermodal Container Services, Inc. (2003) 114 Cal.App.4th 190, 206.) 'By prescribing 'any unlawful' business practice, the UCL borrows violations of other laws and treats them as unlawful practices that the UCL makes independently actionable.' (Gutierrez v. Carmax Auto Superstores California (2018) 19 Cal.App.5th 1234, 1265.) Here, The Complaint alleges 'Defendants violated the UCL by engaging in unlawful business acts or practices.' (Complaint, at ¶ 87.) The 'unlawful' business act is not further identified. (See, Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 619 (holding demurrer properly sustained as the operative complaint did not identify a particular section of the statutory scheme that was violated, nor describe with 'reasonably particularity' the facts supporting the violation).) For these reasons, the demurrer is SUSTAINED WITH LEAVE TO AMEND IN PART AND OVERRULED IN PART.

Motion to Strike The motion to strike is OFF CALENDAR as moot in light of the ruling on the demurrer with leave to amend the Complaint.

Concluding Orders Plaintiff is ordered to file and serve an amended complaint by January 19, 2024.

If the tentative ruling is confirmed without modification, the minute order will be the Court's final ruling.

Defendants are ordered to serve written notice of the Court's final ruling on all appearing parties by January 9, 2024.

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