Judge Christian R. Gullon, Case Number: 23PSCV00895, Date: 2023-09-19 Tentative Ruling

Judge: Christian R. Gullon, Case: 23PSCV00895, Date: 2023-09-19 Tentative Ruling

(1) DEMURRER TO PLAINTIFF’S VERIFIED THIRD AMENDED COMPLAINT is SUSTAINED in its entirety without leave to amend.

(2) DEFENDANT BO SUN’S MOTION TO STRIKE PLAINTIFF WENDY LIN’S VERIFIED THIRD AMENDED COMPLAINT is GRANTED, without leave to amend.

This is a quiet title action regarding properties located at 16485 Monte Cristo Drive, Hacienda Heights, CA 91745 (the “Monte Cristo Property”), 1621 Derringer Lane, Diamond Bar, CA (the “Derringer Lane Property”), and 14211 Skyline Drive, Hacienda Heights, CA (the “Skyline Drive Property”).

On June 14, 2022, Plaintiff filed the complaint against BO SUN, an individual; ALL PERSONS UNKNOWN, Claiming Any Legal or Equitable Right, Title, Estate, Lien, or Interest in the Property Described in this Complaint Adverse to Plaintiff’s title, or any Cloud upon Plaintiff’s Title Thereto; and DOES 1 through 20, inclusive for:

On August 24, 2022, Defendant filed a Demurrer, which on October 4, 2022 the court sustained with leave to amend.

On December 5, 2022, Plaintiff filed a FAC for 1. BREACH OF FIDUCIARY DUTY 2. QUIET TITLE 3. FRAUD 4. DECLARTORY RELIEF 5. INJUNCTIVE RELIEF 6. UNJUST ENRICHMENT/ CONSTRUCTIVE TRUST 7. QUANTUM MERUIT.

On January 12, 2023 Defendant filed its demurrer to the FAC, which on 2/28/23 the court sustained with leave to amend as to the fraud and quiet title causes of action, and overruled as to the others.

On June 14, 2023, the parties filed a stipulation for leave for Plaintiff to file a proposed third amended complaint (TAC). That same day, Plaintiff filed a TAC, alleging the following COAs:

On August 3, 2023, Defendant filed a demurrer and motion to strike (MTS) to the TAC.

Previously, the court sustained the demurrer because “the complaint [was] unintelligible” as it listed a variety of properties without indicating their relevance to each cause of action. Then, in the FAC, the pleadings more clearly stated that the properties are relevant as to the parties’ joint venture agreement (“Joint Venture Agreement”) and arbitration agreement.

That said, upon a third amended complaint, the court determines the fraud and quiet title causes of action are again conclusively pled; thus, after numerous attempts at amendments, leave to amend will be denied.

Defendant demurs on the grounds that the fraud cause of action (predicated upon purported misrepresentation and concealment) is premised upon conclusory allegations.

The court again agrees. Turning to the TAC, the cause of action for Count 1 is predicated upon the following pertinent allegations:

- As to the Derringer Lane Property, Defendant concealed the fact that he had no intention of placing Plaintiff’s name on title

- Plaintiff’s reliance was reasonable because of the fiduciary relationship between the parties

- Defendant’s representation that the loan was safe because he had the equivalent of 8 million dollars of cash in China was a misrepresentation because Defendant did not have 8 million dollars anywhere such that it was a ruse to convince Plaintiff to lend Defendant $460,006 which he would never repay

As noted, before, fraud requires pleading with specificity but merely pleading that Defendant did not fulfill a promise does not amount to fraud. And while Plaintiff’s citation to Committee On Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 217 for the proposition that “less particularity is required when the facts lie more in the knowledge of the opposite party,” the case still requires at least some specificity; merely reiterating elements of the cause of action satisfy pleading standards.

Therefore, as plaintiff’s opposition merely repleads allegations in the TAC, the court sustains the demurrer without leave to amend.

Quiet title actions are governed by Code of Civil Procedure section 760.020, subdivision (a). In turn, the CCP statute permits a party to bring an action “to establish title against adverse claims” to real property. The first step is that a plaintiff files a verified complaint, which is to delineate “[t]he adverse claims to the title of the plaintiff against which a determination is sought” and name as defendants “the persons having adverse claims that are of record or known to the plaintiff or reasonably apparent from an inspection of the property. (Code Civ. Proc., § 761.020, subd. (b).) Moreover, the plaintiff is required to “[i]mmediately” record a lis pendens. (Id.) The court is then required to “examine into and determine the plaintiff's title against the claims of all the defendants.” (Code. Civ. Proc., §764.010.)

Plaintiff again (via identical allegations) asserts this cause of action as to the Derringer Lane Property and is premised upon the following allegation: “Plaintiff transferred $520,000 to Defendant as her share of the purchase price with the expectation that Plaintiff would be entitled to rights to title and equity” but “Defendant did not put Plaintiff on title and instead took title entirely in his own name without ever disclosing this material fact to Plaintiff. Defendant has breached his agreement.” (TAC ¶¶44, 45.)

As previously held, the owner of an equitable interest cannot maintain an action to quiet title against the owner of the legal title. (Stafford v. Ballinger (1962) 199 Cal. App.2d 289, 294-295.) At most Plaintiff has alleged an “expectation” in the title, but Plaintiff has not provided legal authority to support the fact that an expectation of a right, in of itself, could give rise to a quiet title claim.

To the extent that Plaintiff attempts to use allegations of fraud to support an equitable title COA (Opp. pp. 5-6), as noted above, the fraud COA is not properly pled. And to the extent that Plaintiff conclusively cites to Evidence Code section 662 for the proposition that the holder of legal title as being the owner of full beneficial title may be rebutted “only by clear and convincing evidence,” here, this is merely the pleading stage wherein the court is not concerned with evidence but allegations that could support discovery of certain evidence.

As for the motion to strike, as punitive damages are predicated upon the allegation that “defendant fraudulently concealed information that he was obligated to disclose” (Opp. to MTS p. 4:13-15), but as noted above, the court finds fraud is insufficiently pled, punitive damages are unsupported. Thus, as the gist of the TAC is that Defendant allegedly failed to repay money—and failure to repay does not support malice, oppression, or fraud under Civil Code §3294—the motion is granted.[3]

Based on the foregoing, the demurrer is sustained without leave to amend, notably as the TAC is largely similar to the previous complaints and still largely based upon information and belief, not upon facts. To permit Plaintiff to proceed with these COAs against Defendant without facts would permit a plaintiff to assert any COA against a defendant and make any claims against a defendant, which undermines the very purpose of the judicial system.

[1] The opposition is largely a recitation of various law without an adequate analysis.

[2] Defendant notes that Plaintiff has added new allegations and pleads inconsistent allegations. As the court does not find the allegations amount to sham pleadings such that the previous pleadings must be considered nor has Defendant provided an analysis as to how certain inconsistences amount to sham pleadings and exceed scope of leave to amend, the court will not elaborate on the point.

[3] Plaintiff’s opposition largely takes issue with Defendant’s citations in that the cases are inapposite. However, Defendant’s motion provided the definitions of malice, oppression, and fraud, which the definitions in and of themselves undermine Plaintiff’s conclusory allegations of fraud.