Judge: Daniel S. Murphy, Case: 24STCV09643, Date: 2024-09-09 Tentative Ruling

Case Number: 24STCV09643    Hearing Date: September 9, 2024    Dept: 32

BACKGROUND

            On April 17, 2024, Plaintiffs SAS Investment Management, LLC and EJS Enterprises Corp. filed this action against Defendants Mona Ghadiriforoushani (Mona); Mike Kyser Gooch dba MKG Realty & Property Management (MKG); and Professional Property Managers, Inc. (PPMI). The complaint asserts causes of action for (1) professional negligence, (2) breach of fiduciary duty, (3) constructive fraud, (4) statutory violations, and (5) negligence per se.

            The action concerns eight investment properties owned or controlled by Plaintiffs: Hobart, Hayworth, Ave 53, Occidental, Clark, Jasmine, Newcastle, and La Mirada (collectively, the Properties). Mona allegedly managed the properties for Plaintiffs from 2018 to 2022, first as an agent for MKG, then as an agent for PPMI.

Defendants allegedly breached their duties to Plaintiffs and violated the law in the following ways: (i) Mona leased a unit on the Hobart property to her son without properly tying that tenancy to his tenure as resident manager; (ii) Defendants fraudulently included Mona as one of the Hobart tenants without Plaintiffs’ knowledge; (iii) Defendants failed to provide Plaintiffs with copies of the Hobart leases and resident manager agreement; (iv) Defendants failed to submit paperwork to the Housing Authority to obtain reimbursement for certain retrofit costs for the Hobart and Hayworth properties; (v) Defendants failed to implement a certain program (RUBS) to allow the passthrough of certain utility costs to tenants of the Properties; and (vi) Defendants lied to Plaintiffs about the above matters.        

On July 23, 2024, Defendants filed the instant demurrer to the complaint. Plaintiffs filed their opposition on August 26, 2024.

LEGAL STANDARD

A demurrer for sufficiency tests whether a pleading states a cause of action or defense. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) When considering demurrers, courts read the allegations liberally and in context. (Taylor v. City of Los Angeles Dept. of Water and Power (2006) 144 Cal.App.4th 1216, 1228.) In a demurrer proceeding, the defects must be apparent on the face of the pleading or by proper judicial notice. (Code Civ. Proc., § 430.30, subd. (a).) A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. (SKF Farms v. Superior Court (1984) 153 Cal.App.3d 902, 905.) Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed. (Ibid.) The only issue involved in a demurrer hearing is whether the pleading, as it stands, unconnected with extraneous matters, states a cause of action or defense. (Hahn, supra, 147 Cal.App.4th at 747.)

MEET AND CONFER

Before filing a demurrer or a motion to strike, the demurring or moving party is required to meet and confer with the party who filed the pleading demurred to or the pleading that is subject to the motion to strike for the purposes of determining whether an agreement can be reached through a filing of an amended pleading that would resolve the objections to be raised in the demurrer. (Code Civ. Proc., §§ 430.41, 435.5.) The Court notes that Defendants have complied with the meet and confer requirement. (See Bakhos Decl.)

DISCUSSION

I. Property Management Agreement

Defendants begin their demurrer argument by stating: “Defendants intend to demur in that the property management agreement was not attached to the complaint. In regard to Defendant MGK, the property management agreement states Agent assumes no liability for prior management or agent acts . . . Also, per the management agreement, there must be mediation prior to filing a lawsuit, therefore Defendant MGK also intends to demur generally to the complaint for failure to conduct mediation.” (Dem. 3:6-13.)

Defendants cite no authority suggesting that the failure to attach the purported management agreement is grounds for a demurrer. Plaintiffs have not asserted a breach of contract claim, and even if they had, attaching the contract would not be required. (See Miles v. Deutsche Bank National Trust Co. (2015) 236 Cal.App.4th 394, 402.) Whether a contract exists which absolves MGK of liability is a factual issue not suited for resolution on a demurrer. The Court cannot consider extrinsic evidence of the purported agreement on a demurrer. Lastly, Defendants cite no authority supporting their contention that the failure to mediate is grounds for demurrer.

II. Extraneous Facts

            The remainder of Defendants’ demurrer is a narrative of extraneous facts beyond the four corners of the complaint. Defendants cite no authority and make no legal argument about the sufficiency of the allegations that are actually in the complaint. Defendants simply attempt to rebut the allegations through their own version of events, even though Plaintiff’s allegations are assumed true on a demurrer. Because no valid argument has been made about the sufficiency of the complaint, there is no basis for sustaining the demurrer.

CONCLUSION

            Defendants’ demurrer is OVERRULED.