Judge Cynthia A Freeland, Case 37-2022-00001190-CU-BC-NC 2023-08-11 Tentative Ruling

Judge: Cynthia A Freeland, Case: 37-2022-00001190-CU-BC-NC, Date: 2023-08-11 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

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SOUTH BUILDING TENTATIVE RULINGS - August 10, 2023

08/11/2023 01:30:00 PM N-27 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Cynthia A. Freeland

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Civil - Unlimited Breach of Contract/Warranty Demurrer / Motion to Strike 37-2022-00001190-CU-BC-NC AVI-CON INC VS BOOTH [IMAGED] CAUSAL DOCUMENT/DATE FILED: Demurrer, 03/27/2023

Plaintiff/Cross-Defendant Avi-Con Inc. dba CA Construction ('Cross-Defendant')'s demurrer to Defendants/Cross-Complainants Gordon Booth and Nancy Booth (collectively, 'Cross-Complainants')'s Cross-Complaint is overruled.

A demurrer tests the legal sufficiency of a pleading. See McKell v. Washington Mutual, Inc. (2006) 142 Cal. App. 4th 1457, 1469. When reviewing a demurrer, the court 'give[s] the complaint a reasonable interpretation, reading it as a whole and its parts in their context.' Blank v. Kirwan (1985) 39 Cal. 3d 311, 318. The court 'treats the demurrer as admitting all material facts properly pleaded. The court does not, however, assume the truth of contentions, deductions or conclusions of law.' Durell v. Sharp Healthcare (2010) 183 Cal. App. 4th 1350, 1358. The court's analysis is limited to the complaint, exhibits attached to the complaint and incorporated by reference, and matters properly subject to judicial notice. See Performance Plastering v. Richmond American Homes of California, Inc. (2007) 153 Cal. App. 4th 659, 665; Thorburn v. Department of Corrections (1998) 66 Cal. App. 4th 1284, 1287-1288; Donabedian v. Mercury Ins. Co. (2004) 116 Cal. App. 4th 968, 994.

The demurrer to the third cause of action for intentional misrepresentation is overruled. 'The elements of a cause of action for intentional misrepresentation are (1) a misrepresentation, (2) with knowledge of its falsity, (3) with the intent to induce another's reliance on the misrepresentation, (4) actual and justifiable reliance, and (5) resulting damage.' Chapman v. Skype Inc. (2013) 220 Cal. App. 4th 217, 230-231.

Under California law, intentional misrepresentation is subject to heightened pleading requirements. See Lazar v. Sup. Ct. (1996) 12 Cal. 4th 631, 645; Rossberg v. Bank of America, N.A. (2013) 219 Cal. App. 4th 1481. This means that '(1) general pleading of the legal conclusion of fraud is insufficient; and (2) every element of the cause of action must be alleged in full, factually and specifically, and the policy of liberal construction of pleading will not usually be invoked to sustain a pleading that is defective in any material respect.' Wilhelm v. Pray, Price, Williams & Russell (1986) 186 Cal. App. 3d 1324, 1331.

Indeed, '[t]he 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.' West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal. App. 4th 780, 793. See also Small v. Fritz Co., Inc. (2003) 30 Cal. 4th 167, 184.

The court finds that the Cross-Complaint alleges facts with the requisite specificity sufficient to constitute a cause of action for intentional misrepresentation. The Cross-Complaint alleges that on August 18, 2020, Cross-Defendant caused an invoice to be sent to Cross-Complainants in which Cross-Defendant Calendar No.: Event ID: TENTATIVE RULINGS

2954831 CASE NUMBER: CASE TITLE: AVI-CON INC VS BOOTH [IMAGED] 37-2022-00001190-CU-BC-NC represented that it had completed 32% of the work and, as a result, sought payment of 32% of the contract price, i.e., $48,432.66. See Cross-Complaint, ¶ 30. The Cross-Complaint further alleges that Cross-Defendant knew this was false as it had not begun any work on the project. Ibid., ¶ 31. Such misrepresentations were made to induce Cross-Complainants' reliance and to secure the payment, and Cross-Complainants reasonably relied on the representation and paid the amount to their detriment.

Ibid., ¶¶ 32-36. The foregoing is sufficient to survive the pleading stage.

Accordingly, the court overrules the demurrer to the third cause of action.

The demurrer to the fourth cause of action for unfair business practices/violation of California Business & Professions Code ('BPC') §§ 17200 et seq. is overruled. BPC § 17200 defines unfair competition as 'any unlawful, unfair or fraudulent business act or practice . . . .' Cal. Bus. & Prof. Code § 17200. The law is 'sweeping, embracing anything that can properly be called a business practice and at the same time is forbidden by law.' Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Company (1999) 20 Cal. 4th 163, 180. Since BPC § 17200 is written in the disjunctive, Cross-Complainants state a cause of action provided any of the three prongs are satisfied. See Podolsky v. First Healthcare Corp.

(1996) 50 Cal. App. 4th 632, 647; Berryman v. Merit Property Management, Inc. (2007) 152 Cal. App. 4th 1544, 1554. In relevant part, under the fraudulent prong, '[a] business practice is fraudulent under the UCL if a plaintiff can show that 'members of the public are likely to be deceived.'' Kaldenbach v. Mutual of Omaha Life Ins. Co. (2009) 178 Cal. App. 4th 830, 847 (quoting Bardin v. Daimlerchrysler Corporation (2006) 136 Cal. App. 4th 1255, 1261).

In this case, the demurrer's focus is on the 'fraudulent' prong. More specifically, Cross-Defendant argues: Defendants and Cross-complainants have sprinkled throughout their cause of action for Unfair Business Practices, fraud or deceit or misrepresentation, all of which are under the umbrella of fraud. As stated in Plaintiff and Cross-defendants [sic] demurrer to Defendants and Cross-complainants third cause of action for Fraud, the particularities required are absent.

See Demurrer, Section III, ll. 21-24. As discussed above, however, the Cross-Complaint sufficiently states a cause of action for fraud/intentional misrepresentation. Additionally, the Cross-Complaint alleges that Cross-Defendant's conduct, separate and apart from the alleged intentional misrepresentation and, which is specifically identified in the operative pleading, violates BPC §§ 7159.5(a)(3), (4), 7159(c)(2), (3)(B)(ii), (5), and 7159(d), (d)(9)(C). See Cross-Complaint ¶¶ 40-48. If ultimately proven, the alleged violations would support a UCL claim under the 'unlawful' prong. As a result, the foregoing is sufficient to survive the pleading stage.

Accordingly, the court overrules the demurrer to the fourth cause of action.

In light of the foregoing, the court overrules the demurrer. Cross-Defendant shall file and serve an answer or otherwise plead to the Cross-Complaint within ten (10) days of this hearing. See Cal. R. Ct.

3.1320(j).

This is the tentative ruling for the hearing at 1:30 p.m. on Friday, August 11, 2023. If no party appears at the hearing, this tentative ruling will become the order of the court as of August 11, 2023. If the parties are satisfied with the court's tentative ruling or do not otherwise wish to argue the motion, they are encouraged to give notice to the court and each other of their intention not to appear, though this notice is not required.

Calendar No.: Event ID: TENTATIVE RULINGS

2954831