Judge Daniel M. Crowley, Case Number: 23STCV21150, Date: 2024-01-12 Tentative Ruling

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Defendants Ford Motor Company’s and Bob Wondries Ford’s demurrer to Plaintiffs Virginia Diaz’s and Juan Diaz’s complaint is sustained as to the 3rd cause of action with 20 days leave to amend, and overruled as to the 1st and 2nd causes of action.

Defendants Ford Motor Company (“Ford”) and Bob Wondries Ford (“Bob Wondries”) (collectively, “Defendants”) demur to Plaintiffs Virginia Diaz’s (“Virginia”) and Juan Diaz’s (“Juan”) (collectively, “Plaintiffs”) complaint (“Complaint”). (Notice of Demurrer, pg. 1.)

Before filing a demurrer, the moving party must meet and confer in person or by telephone with the party who filed the pleading to attempt to reach an agreement that would resolve the objections to the pleading and obviate the need for filing the demurrer. (C.C.P. §430.41.)

Defendant’s counsel declares that on October 26, 2023, Sara K. Ross, of Defendant’s firm, met and conferred telephonically with Plaintiff’s counsel regarding the instant motion, and the parties were unable to reach a resolution regarding the deficiencies in the Complaint. (Decl. of Liu ¶3.) Defendant’s declaration demonstrates a good faith effort to resolve the issues in the instant motion out of court. Therefore, Defendant’s demurrer is proper.

Plaintiffs filed the operative Complaint on September 1, 2023, against Defendants alleging three causes of action: (1) violation of the Song-Beverly Consumer Warranty Act Civil Code §§1790 et seq. (“Song-Beverly”)- breach of express warranty [against Ford]; (2) fraudulent inducement- concealment [against Ford]; and (3) negligent repair [against Bob Wondries]. Plaintiff’s causes of action arise from their December 13, 2017, purchase of a new 2018 Ford Mustang (“Subject Vehicle”) and a transmission defect in the Subject Vehicle. (See Complaint.)

Defendants filed the instant demurrer on October 30, 2023. Plaintiffs filed their opposition on December 29, 2023. Defendants filed their reply on January 5, 2024.

Defendants demur to all three causes of action in Plaintiffs’ Complaint on the basis they each fail to state facts sufficient to constitute causes of action against Defendants. (Demurrer, pg. 2; C.C.P. §430.10(e).)

“[A] demurrer tests the legal sufficiency of the allegations in a complaint.” (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.) 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. (See Donabedian v. Mercury Insurance Co. (2004) 116 Cal.App.4th 968, 994 [in ruling on a demurrer, a court may not consider declarations, matters not subject to judicial notice, or documents not accepted for the truth of their contents].) For purposes of ruling on a demurrer, all facts pleaded in a complaint are assumed to be true, but the reviewing court does not assume the truth of conclusions of law. (Aubry v. Tri-City Hospital District (1992) 2 Cal.4th 962, 967.)

Civil Code §1793.2 requires a manufacturer to replace a defective “new motor vehicle” or make restitution if, after a reasonable number of attempts, the manufacturer (or its representative) is unable to repair the vehicle to conform to the applicable express warranty. (Civil Code §1793.2(d)(2).)

To state a cause of action under the statute, a plaintiff must allege the following: (1) plaintiff bought a consumer good manufactured by the defendant; (2) defendant gave plaintiff a warranty by making a written statement of an express warranty; (3) the consumer good did not match the quality as set forth in the written statement; (4) plaintiff delivered the consumer good to the defendant or its authorized repair facilities for repair; (5) defendant or its representative failed to repair the consumer good to match the written statement after a reasonable number of opportunities; and (6) defendant did not replace the consumer good or reimburse plaintiff an amount of money equal to the purchase price of the consumer good, less the value of its use by plaintiff before discovering the defect. (CACI 3200.)

Plaintiffs allege on or around April 27, 2018, Plaintiffs delivered the Subject Vehicle to South Bay Ford Lincoln, an authorized Ford repair facility, for repair. (Complaint ¶60.) Plaintiffs allege they complained that the Subject Vehicle would clunk when placing a foot on the brake and adjusting the gear shifter to drive that could be heard in downshift from fifth to fourth gear. (Complaint ¶60.) Plaintiffs allege the repair facility technicians asked Plaintiffs to return another day. (Complaint ¶60.) Plaintiffs allege the Subject Vehicle was returned to Plaintiffs. (Complaint ¶60.) Plaintiffs allege the service technician represented to Plaintiffs that the Subject Vehicle was safe to drive. (Complaint ¶60.) Plaintiffs allege they reasonably relied on this representation by the service technician at the authorized Ford repair facility. (Complaint ¶60.) Plaintiffs allege all repairs were covered under Ford written warranty. (Complaint ¶60.)

Plaintiffs allege on or around April 30, 2018, Plaintiffs delivered the Subject Vehicle to South Bay Ford Lincoln, an authorized Ford repair facility, for repair. (Complaint ¶61.) Plaintiffs allege on or around June 9, 2018, Plaintiffs delivered the Subject Vehicle to South Bay Ford Lincoln, an authorized Ford repair facility, for repair. (Complaint ¶62.) Plaintiffs allege on or around March 19, 2020, Plaintiffs delivered the Subject Vehicle to South Bay Ford Lincoln, an authorized Ford repair facility, for repair. (Complaint ¶63.) Plaintiffs allege on or around August 31, 2022, Plaintiffs delivered the Subject Vehicle to South Bay Ford Lincoln, an authorized Ford repair facility, for repair. (Complaint ¶64.)

Plaintiffs allege on or around December 9, 2022, Plaintiffs delivered the Subject Vehicle to South Bay Ford Lincoln, an authorized Ford repair facility, for repair. (Complaint ¶65.) Plaintiffs allege on or around January 6, 2023, Plaintiffs delivered the Subject Vehicle to Bob Wondries, an authorized Ford repair facility, for repair. (Complaint ¶66.) Plaintiffs allege on or around December 9, 2022, was the earliest date that Plaintiffs discovered or could reasonably discovered the facts that give rise to Plaintiffs’ fraud cause of action. (Complaint ¶75.) Plaintiffs allege on or around that date, was the second time that the Subject Vehicle’s transmission was replaced. (Complaint ¶75.)

Plaintiffs allege they could not have discovered their fraud claims prior to December 9, 2022. (Complaint ¶76.) Plaintiffs allege they could not, even with reasonable and diligent investigation, have discovered Plaintiffs’ claims on an earlier date because of Ford’s concealment of the defects in Plaintiffs’ vehicle, as previously alleged, and because of the repeated false assurances from Ford and its service dealership agents to Plaintiffs, on which Plaintiffs reasonably relied, that Ford had and would repair any problems with the transmission in Plaintiffs’ vehicle that occurred during the applicable warranty periods. (Complaint ¶76.)

Defendants argue Plaintiffs’ breach of express warranty cause of action is barred by the applicable four-year statute of limitations. (See Krieger v. Nick Alexander Imports, Inc. (1991) 234 Cal.App.3d 205, 213-214; Com. Code §§2725(1)-(2).)

A cause of action does not accrue until the plaintiff discovers or could have discovered through the exercise of reasonable diligence all facts essential to his cause of action. (April Enterprises, Inc. v. KTTV (1983) 147 Cal.App.3d 805, 826-827; see also Hebrew Academy of San Francisco v. Goldman (2007) 42 Cal.4th 883, 894.) Whether the plaintiff exercised reasonable diligence is a question for the trier of fact. (Fox v. Ethicon-Endo Surgery, Inc. (2005) 35 Cal.4th 797, 810; Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1112.) Here, Plaintiffs sufficiently allege, at the pleading stage, that their cause of action did not accrue until December 9, 2022. (Complaint ¶76.) This same logic applies to Defendants’ argument on the statute of limitations for Plaintiffs’ fraud cause of action.

Accordingly, Defendants’ demurrer to Plaintiff’s 1st cause of action is overruled.

The required elements for fraudulent concealment are: “(1) concealment or suppression of a material fact; (2) by a defendant with a duty to disclose the fact to the plaintiff; (3) the defendant intended to defraud the plaintiff by intentionally concealing or suppressing the fact; (4) the plaintiff was unaware of the fact and would not have acted as he or she did if he or she had known of the concealed or suppressed fact; and (5) plaintiff sustained damage as a result of the concealment or suppression of the fact.” (See Bank of America Corp. v. Superior Court (2011) 198 Cal.App.4th 862, 870; Civ. Code §1710(3); CACI 1901.) The rule of specificity of pleading is only intended for affirmative fraud cases not fraud by concealment. (See Alfaro v. Community Housing Improvement Systems & Planning Association, Inc. (2009) 171 Cal.App.4th 1356, 1384.)

Plaintiffs failed to plead with sufficient particularity what representations Ford made to these particular Plaintiffs regarding the Transmission Defect that these Plaintiffs relied on in purchasing the Subject Vehicle. Plaintiffs do not plead that Ford made any specific representations directly to Plaintiffs. Plaintiffs do not allege any direct contact with Ford before purchasing the Subject Vehicle where representations regarding the Transmission Defect at issue should or could have been revealed. Merely alleging that Ford omitted facts about an alleged Transmission Defect in its general advertisements to an unknown audience cannot establish: (1) knowledge of a particular defect in a particular vehicle, or (2) intent to conceal this particular knowledge from these particular Plaintiffs. (See Tenzer v. Superscope, Inc. (1985) 39 Cal. 3d 18, 30 [“something more than nonperformance is required to prove the defendant’s intent not to perform his promise”].)

Plaintiffs’ interactions with a third-party dealership, i.e. “statements made during the sales process” are not pled as specific to the Transmission Defect and would amount to standard sales “puffery” that courts have repeatedly held to be non-actionable anyway. (Hauter v. Zogarts (1975) 14 Cal. 3d 104, 111 [statements of opinion, or “puffing,” are non-actionable].) Further, even if Plaintiffs claim to have relied on representations, misstatements, or omissions by an authorized dealer, such conduct is not attributable to Defendant or actionable against Defendant.

Plaintiffs do not claim there were ever representations by Defendant or a dealership about the transmission of the Subject Vehicle on which they relied. Therefore, the concealed or omitted fact—the Transmission defect—cannot be “contrary to a [material] representation actually made by the defendant.” (Gutierrez v. Carmax Auto Superstores California (2018) 19 Cal.App.5th 1234, 1258.)

Additionally, Plaintiffs improperly rely on the issuance of TSBs, as a TSB does not establish knowledge of the alleged defect. (See American Honda Motor Co., Inc. v. Superior Court (2011) 199 Cal.App.4th 1367, 1378 [“A TSB is not and cannot fairly be construed by a trial court as an admission of a design or other defect, because TSBs are routinely issued to dealers to help diagnose and repair typical complaints.”].)

As Plaintiffs have not sufficiently alleged Ford’s exclusive knowledge and active concealment of the engine defects, Plaintiffs have also failed to show Defendant had a duty to disclose to Plaintiffs. (See Los Angeles Memorial Coliseum Commission v. Insomniac, Inc. (2015) 233 Cal.App.4th 803, 831 [detailing the ways in which a fiduciary duty may arise].)

Accordingly, Defendant’s demurrer to Plaintiff’s 2nd cause of action is sustained with 20 days leave to amend.

A repairer is negligent if it fails to use the amount of care in repairing the product that a reasonably careful repairer would use in similar circumstances to avoid exposing others to a foreseeable risk of harm. (CACI 1221.)

Plaintiffs allege they delivered the Subject Vehicle to Bob Wondries for repair. (Complaint ¶133.) Plaintiffs allege Bob Wondries owed a duty to Plaintiffs to use ordinary care and skill in storage, preparation and repair of the Subject Vehicle in accordance with industry standards. (Complaint ¶134.) Plaintiffs allege Bob Wondries breached its duty to Plaintiffs to use ordinary care and skill by failing to properly store, prepare and repair of the Subject Vehicle in accordance with industry standards. (Complaint ¶135.) Plaintiffs allege Bob Wondries’ negligent breach of its duties owed to Plaintiffs were proximate cause of Plaintiffs’ damages. (Complaint ¶136.)

Defendants’ demurrer to Plaintiffs’ negligent repair cause of action based on the economic loss rule is unavailing. Here, Plaintiffs delivered their vehicle for repair—a professional service—and reasonably expected that Bob Wondries Ford would perform the repair “with care, skill, reasonable expedience, and faithfulness.” (North American Chemical Co. v. Superior Court (1997) 59 Cal.App.4th 764, 774.) The negligent performance of the repair service brings Plaintiffs’ claims outside the ambit of the economic loss rule, and Plaintiffs do not allege the parties formed a contract for the repair of services.

Further, under Jimenez v. Superior Court (2002) 29 Cal.4th 473, “the economic loss rule does not necessarily bar recovery in tort for damage that a defective product (e.g., a window) causes to other portions of a larger product (e.g., a house) into which the former has been incorporated.” (Jimenez v. Superior Court (2002) 29 Cal.4th 473, 483.) Here, Plaintiffs allege they delivered the Subject Vehicle for repair of a specific part, the transmission, and Bob Wondries failed to properly repair the vehicle.

Accordingly, Defendants’ demurrer to Plaintiffs’ 3rd cause of action is overruled.

Defendants’ demurrer to Plaintiffs’ 2nd cause of action is sustained with 20 days leave to amend.

Defendants’ demurrer to Plaintiffs’ 1st and 3rd causes of action is overruled.

Hon. Daniel M. Crowley

Judge of the Superior Court