Judge: David A. Rosen, Case: 22GDCV00874, Date: 2023-05-05 Tentative Ruling

Case Number: 22GDCV00874    Hearing Date: May 5, 2023    Dept: E

Case No: 22GDCV00874
Hearing Date:  05/05/2023 – 10:00am

Trial Date: Unset

Case Name: HRVOJIE VEJIC v. DIANA HERRERA, an individual; and DOES 1 to 50

 

TENTATIVE RULING ON DEMURRER

[The Court docket erroneously says the instant hearing is for a demurrer with a motion to strike;              however, there is no motion to strike.]

Moving Party: Defendant, Diana Hererra Galvez

Responding Party: Plaintiff, Hrvoje Vejic

(Oppo and Reply Submitted)

Proof of Service Timely Filed (CRC Rule 3.1300): Ok
16/21 Court Days Lapsed (CCP 1005(b)): Ok
Proper Address: Ok

Moving Papers: Demurrer; Request for Judicial Notice; Proposed Order

Opposition Papers: Opposition

Reply Papers: Reply

The Court notes that the Reply was submitted late. The Court still considers the Reply.

RELIEF REQUESTED
Defendant, Diana Herrera Galvez demurs to the First through Eighth causes of action in Plaintiff’s Complaint pursuant to CCP §430.10(e).

BACKGROUND
The instant Complaint was filed on 11/15/2022 and alleged eight causes of action – (1) Fraudulent Inducement, (2) Unjust Enrichment, (3) Violation of 15 U.S.C. §771 et seq., (4) Breach of Oral Contract, (5) Breach of Contract, (6) Conversion, (7) Promissory Estoppel, and (8) Fraudulent Misrepresentation.

The instant action pertains to Plaintiff’s allegations that Defendant Herrera, introducing herself to Plaintiff using the alias of Olivia Sarah Smith, fraudulently duped Plaintiff out of money by getting Plaintiff to invest in Defendant’s cryptocurrency investment portfolio.

PROCEDURAL
Meet and Confer
A party filing a demurrer “shall meet and confer in person or by telephone with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.”  (Code Civ. Proc., §430.41, subd. (a).)  “The parties shall meet and confer at least five days before the date the responsive pleading is due. If the parties are not able to meet and confer at least five days prior to the date the responsive pleading is due, the demurring party shall be granted an automatic 30-day extension of time within which to file a responsive pleading, by filing and serving, on or before the date on which a demurrer would be due, a declaration stating under penalty of perjury that a good faith attempt to meet and confer was made and explaining the reasons why the parties could not meet and confer.”  (Code Civ. Proc., §430.41, subd. (a)(2).) Failure to sufficiently meet and confer is not grounds to overrule or sustain a demurrer. (Id., §430.41(a)(4).)

Here, moving party alleged it met and conferred. (Decl. Banos ¶4-7.)

LEGAL STANDARDS FOR DEMURRERS
Demurrer – Sufficiency
A demurrer for sufficiency tests whether the complaint states a cause of action.  (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.)  The court “treat[s] the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law ….”  (Berkley v. Dowds (2007) 152 Cal.App.4th 518, 525.)  In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice.  (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.)  A demurrer tests the pleadings alone and not the evidence or other extrinsic matters; therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.  (Code Civ. Proc., §§ 430.30, 430.70.)  The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action. (Hahn, supra, 147 Cal.App.4th at 747.) 

The general rule is that the plaintiff need only allege ultimate facts, not evidentiary facts.  (Doe v. City of Los Angeles (2007) 42 Cal.4th 531, 550.)  “All that is required of a plaintiff, as a matter of pleading … is that his complaint set forth the essential facts of the case with reasonable precision and with sufficient particularity to acquaint the defendant with the nature, source and extent of his cause of action.”  (Rannard v. Lockheed Aircraft Corp. (1945) 26 Cal.2d 149, 156-157.) 

On demurrer, a trial court has an independent duty to “determine whether or not the … complaint alleges facts sufficient to state a cause of action under any legal theory.”  (Das v. Bank of America, N.A. (2010) 186 Cal.App.4th 727, 734.)  “A demurrer does not lie to a portion of a cause of action.” (PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682.)  “Generally it is an abuse of discretion to sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment.”  (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.)

Demurrer – Uncertainty
A special demurrer for uncertainty, CCP section 430.10(f), is disfavored and will only be sustained where the pleading is so bad that defendant cannot reasonably respond—i.e., cannot reasonably determine what issues must be admitted or denied, or what counts or claims are directed against him/her.  (Khoury v. Maly’s of Calif., Inc. (1993) 14 Cal.App.4th 612, 616.)  Moreover, even if the pleading is somewhat vague, “ambiguities can be clarified under modern discovery procedures.” (Ibid.)

 

ANALYSIS

Preliminary Matter
Defendant’s demurrer is poorly written and sometimes unintelligible. At several points in the moving papers, Defendant makes arguments without citing any supporting legal basis.

Venue
Defendant objects to Plaintiff’s choice of venue in Los Angeles County.

Defendant argues that Defendant resides in San Bernardino, that Plaintiff fails to allege facts indicating the time, place, and manner in which the allegations occurred, and that Plaintiff fails to allege any facts establishing any nexus between this matter and Los Angeles County.

As to those arguments, Defendant provided no legal authority to support its argument that Plaintiff must allege those facts and Defendant provided no legal authority that if Plaintiff does not allege those facts a demurrer must be sustained.

Further, Defendant cited CCP §395 and 116.370.

CCP §116.370 is inapplicable as this statute pertains to venue in small claims actions.

As to CCP §395, Defendant cited no subsection of this statute, and the Court notes that this statute has three subsections – CCP §395(a), 395(b), and 395(c). Defendant did not cite or quote to any specific subsection of CCP §395.

Therefore, it is not entirely clear as to the legal basis Defendant is attempting to object to venue.

Further, based on the Court’s research, it does not appear that Defendant’s objection to venue is properly asserted in a demurrer hearing.

As stated in CCP §396b(a):

Except as otherwise provided in Section 396a, if an action or proceeding is commenced in a court having jurisdiction of the subject matter thereof, other than the court designated as the proper court for the trial thereof, under this title, the action may, notwithstanding, be tried in the court where commenced, unless the defendant, at the time he or she answers, demurs, or moves to strike, or, at his or her option, without answering, demurring, or moving to strike and within the time otherwise allowed to respond to the complaint, files with the clerk, a notice of motion for an order transferring the action or proceeding to the proper court, together with proof of service, upon the adverse party, of a copy of those papers. Upon the hearing of the motion the court shall, if it appears that the action or proceeding was not commenced in the proper court, order the action or proceeding transferred to the proper court.

 

(Ibid. [emph. added.])

 

Based on the Court’s reading of CCP §396b(a), and based on the fact that Defendant provided no legal authority, it appears that Defendant’s objection to venue is not yet properly before this Court since Defendant did not file a notice of motion for an order transferring this action or proceeding to the proper court. Additionally, the Court notes that Defendant’s notice of motion for its demurrer made no mention that this motion was a motion for transfer of venue.

 

Pages 9-10 of Demurrer

In Defendant’s demurrer on pages 9 and 10, Defendant: states how Defendant’s full name is Diana Melissa Herrera Galvez; mentions a FINRA license; refers to a driver’s license; and argues that Plaintiff fails to allege facts confirming Defendant’s identity.

 

Again, Defendant provides no legal authority or case citations to give the Court any context as to why any of these arguments or assertions are relevant. It is unclear as to what legal argument Defendant is trying to make.

 

First Cause of Action – Fraudulent Inducement
Defendant argues that Plaintiff did not allege facts sufficient to constitute an action for fraudulent inducement. Defendant cites no legal authority as to what the elements are for fraudulent inducement, and thus in no clear manner does Defendant assert which elements of a fraudulent inducement cause of action Plaintiff has failed to allege or failed to allege sufficient facts.

 

For example, Defendant argues:

 

Here, Plaintiff alleges that thousands of dollars were swindled from a digital wallet controlled by Olivia Sarah Smith, and further [erroneously] alleges Defendant Herrera Galvez to be this individual through a California Driver’s License for Olivia Sarah Smith and photos provided to Plaintiff. (See Plaintiff’s Complaint, ¿43) No other facts are alleged by Plaintiff to unequivocally identify Defendant Herrera Galvez as the perpetrator of a cause of action for fraudulent inducement. In fact, Plaintiff’s factual allegations fail to provide facts as to personally meeting Defendant Herrera Galvez, confirming the identification and alleged credentials of Olivia Sarah Smith, or exercise of due diligence as a reasonable investor. Such factual deficiencies make it further unclear and uncertain as to how, where, and why Plaintiff’s thousands of dollars were transferred from Croatia to a wallet allegedly controlled by Defendant Herrera Galvez, a resident of and employed in San Bernardino, California; and how, where, and why Plaintiff’s cryptocurrency ownership and/or United States Domination (USD) funds were allegedly removed, stolen, or otherwise secreted away by Defendant Herrera Galvez; or that Defendant Herrera Galvez even had access to Plaintiff’s property in the foreign country of Croatia, at all. (See Plaintiff’s Complaint, ¿89-94.)

 

(Def. Mot. p. 11-12.)

 

Nowhere in Defendant’s argument does Defendant provide any legal authority that Plaintiff must allege the specific allegations that Defendant purports Plaintiff must allege.

 

However, Defendant did argue that Plaintiff did not allege facts as to how, when, where, to whom, and by what means the representations were tendered. As to that issue, Defendant appears to have a valid argument.

 

As stated in Lazar:

 

“Promissory fraud” is a subspecies of the action for fraud and deceit. A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such intention, there is an implied misrepresentation of fact that may be actionable fraud. (Union Flower Market, Ltd. v. Southern California Flower Market, Inc. (1938) 10 Cal.2d 671, 676, 76 P.2d 503; see Civ.Code, § 1710, subd. (4); 5 Witkin, Summary of Cal.Law, supra, § 685, pp. 786–787.)

 

An action for promissory fraud may lie where a defendant fraudulently induces the plaintiff to enter into a contract… [citation omitted.]

 

(Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.)

 

Further stated in Lazar, “The elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.)

 

(a)Misrepresentation

In California, fraud must be pled specifically, general and conclusory allegations do not suffice. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.) This particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered. (Id.) A plaintiff’s burden in asserting a fraud claim against a corporate employer is even greater. (Id.) In such a case, the plaintiff must allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written. (Id.)

 

Here, Defendant is not a corporate entity, so those additional requirements need not be pleaded. However, Plaintiff must still plead facts which show how, when, where, to whom, and by what means the representations were tendered.

 

In Plaintiff’s Complaint, Plaintiff appears to identify the false representations in Paragraph 56 of the Complaint. Problematic with the allegations in Paragraph 56 is that for each misrepresentation alleged from ¶56(a)-56(d), Plaintiff does not allege facts which show how, when, where, to whom, and by what means each representation was tendered.

 

Confusingly, Plaintiff identifies in its Opposition on pages 6-7 that the misrepresentations are located in ¶24, 26, 30, 31, 37, 38, and 41. If  Plaintiff is arguing that the misrepresentations are not located in ¶56 of the Complaint, then the misrepresentations themselves are entirely unclear. Either way, Plaintiff did not allege facts which show how, when, where, to whom, and by what means each representation was tendered.

 

(b)Knowledge of Falsity (or scienter)

Here, Plaintiff appears to have sufficiently alleged this element in ¶57 of the Complaint.

 

(c)Intent to defraud, i.e., to induce reliance

It is not entirely clear if Plaintiff alleged this element. Plaintiff alleged in ¶57, “Defendant knew these representations were false when made and Defendant intended Plaintiff rely on these statements when entrusting her with several large deposits into his Wallet as an investment in her Scheme.”

 

Here, Plaintiff doesn’t explicitly state that Defendant intended to defraud Plaintiff, nor did Plaintiff explicitly stated that Defendant “intended to induce reliance.” Plaintiff alleged that Defendant “intended Plaintiff rely on these statements.”

 

(d)Justifiable Reliance
Here, Plaintiff sufficiently alleged this element by alleging, “Plaintiff justifiably relied on Defendant’s false representations.” (Compl. ¶58.)

 

(e) Resulting Damage
Here, Plaintiff alleged, “As a result of Defendant’s fraudulent conduct, Plaintiff has suffered damages in an amount to be determined at trial.” (Compl. ¶61.) Therefore, Plaintiff sufficiently alleged this element.

 

Tentative Ruling – First Cause of Action – Fraudulent Inducement
Defendant’s demurrer to Plaintiff’s first cause of action for failure to state facts sufficient to constitute a cause of action is SUSTAINED with 20 days’ leave to amend.

 

Second Cause of Action – Unjust Enrichment
Defendant argues that a cause of action for unjust enrichment is inapplicable because it is not recognized as a proper cause of action in California.

 

Defendant argues in the alternative that even if the Court were to recognize unjust enrichment as a proper cause of action in California, unjust enrichment only applies where there is no enforceable contract. Defendant cites LeBrun v. CBS Television Studios, Inc. (2021) 68 Cal. App.5th 199, 209. Thus, Defendant argues that since Plaintiff alleged an oral contract and a written contract, the Plaintiff’s cause of action for unjust enrichment must be dismissed.

 

In Opposition, Plaintiff argues: There is a split of authority as to whether unjust enrichment is a cause of action; the Second District, where this Court sits, has held that unjust enrichment is a viable cause of action; unjust enrichment is covered in CACI No. 370 and by incorporating these jury instructions, California courts ensure that juries are properly educated on these elements in unjust enrichment claims therefore unjust enrichment is a valid cause of action; and the Court of Appeals has held that properly plead claims for both breach of contract and unjust enrichment could survive demurrer.

 

Tentative Ruling – Second Cause of Action – Unjust Enrichment

As a preliminary matter, Defendant arguing that in the alternative, “[e]ven if the Court were to recognize unjust enrichment as a proper cause of action in California, unjust enrichment only applies where there is no enforceable contract,” is unavailing. Defendant appears to be arguing that because Plaintiff alleged breach of oral and written contract, Plaintiff cannot allege unjust enrichment. However, Defendant ignores the fact that whether or not this contract is enforceable has not been determined yet. The instant case is only at the pleading stage. Further, a party may plead alternative legal theories and make inconsistent allegations in the pleading. (See Mendoza v. Rast Produce Co., Inc. (2006) 140 Cal.App.4th 1395, 1402; Rader Co. v. Stone (1986) 178 Cal.App.3d 10, 29.)

 

Further, Plaintiff cited Elder v. Pacific Bell Telephone Co. (2012) 205 Cal. App.4th 841 wherein the Court of Appeal allowed a breach of contract claim and a claim for restitution/unjust enrichment to be alleged.

 

Additionally, Plaintiff is correct to note that Lectrodryer v. SeoulBank (2000) 77 Cal.App.4th 723, a case in the Second District, recognized a cause of action for unjust enrichment.  

 

In Plaintiff’s Complaint, Plaintiff alleged in ¶63 of the second cause of action that all prior allegations were incorporated herein. In ¶64-67, Plaintiff alleged, “Plaintiff conferred benefits on Defendant. Defendant knowingly accepted these benefits. It is against equity and good conscience that Defendants retain such benefits, and the same should be disgorged and returned to Plaintiff. Defendant is thus liable to Plaintiff in an amount to be determined at trial.” (Compl. ¶64-67.)


When appellate decisions are in conflict on a point, the court exercising inferior jurisdiction must choose between the conflicting decisions. (Auto Equity Sales, Inc. v. Superior Court of Santa Clara County (1962) 57 Cal.2d 450, 456.)

In California, there is no cause of action for unjust enrichment. (See Rutherford Holdings LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 231; Levine v. Blue Shield of California (2010) 189 Cal.App.4th 1117, 1138.)

The Court notes that while Plaintiff cites a Second District case recognizing an unjust enrichment claim under California law, the more recent cases of Rutherford Holdings and Levine have confirmed that unjust enrichment is not a cause of action in California.  “Unjust enrichment is not a cause of action, however, or even a remedy, but rather a general principle, underlying various legal doctrines and remedies…it is synonymous with restitution.” (Rutherford Holdings LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 231.)

“Under the law of restitution, an individual is required to make restitution if he or she is unjustly enriched at the expense of another. A person is enriched if the person receives a benefit at another’s expense. However, the fact that one person benefits another is not, by itself, sufficient to require restitution. The person receiving the benefit is required to make restitution only if the circumstances are such that, as between the two individuals, it is unjust for the person to retain it.” (Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1370 citing McBride v. Boughton (2004) 123 Cal.App.4th 379, 388.)

“There are several potential bases for a cause of action seeking restitution. For example, restitution may be awarded in lieu of breach of contract damages when the parties had an express contract, but it was procured by fraud or is unenforceable or ineffective for some reason.” (McBride v. Boughton (2004) 123 Cal.App.4th 379, 388.) Thus, a party to an express contract can assert a claim for restitution based on unjust enrichment by alleging in that cause of action that the express contract is void or was rescinded. (Rutherford Holdings LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 231 citing Lance Camper Manufacturing Corp.v. Republic Indemnity Co. (1996) 44 Cal.App.4th 194, 203.)

Here, Plaintiff does not appear to be seeking restitution based on unjust enrichment, nor does Plaintiff appear to be alleging an express contract was void or rescinded.

“Alternatively, restitution may be awarded where the defendant obtained a benefit from the plaintiff by fraud, duress, conversion or similar conduct. In such cases, the plaintiff may choose not to sue in tort, but instead to seek restitution on a quasi-contract theory (an election referred to at common law as “waiving the tort and suing in assumpsit”). In such cases, where appropriate, the law will imply a contract (or rather, a quasi-contract), without regard to the parties’ intent, in order to avoid unjust enrichment.” (McBride v. Boughton (2004) 123 Cal.App.4th 379, 388.)

Here, Plaintiff does not allege in the Complaint that it is seeking restitution nor does Plaintiff appear to allege it is seeking restitution on a quasi-contract theory.

Defendant’s demurrer as to the second cause of action is sustained with 20 days’ leave to amend.

Third Cause of Action – Violation of 15  U.S.C. §771 et seq.
Defendant argues that Plaintiff failed to allege facts sufficient to constitute a cause of action for Violation of 15 U.S.C. §771 et seq. However, Defendant makes arguments without citing legal authority and gives the Court no explanation as to why its arguments provide a legal basis to sustain a demurrer as to this cause of action. The Court also notes that Opposition’s brief is equally unhelpful as it provides no legal authority and gives no explanation as to why its arguments provide a legal basis that it did in fact sufficiently allege facts for this cause of action.

Tentative Ruling – Third Cause of Action - Violation of 15  U.S.C. §771 et seq.
Defendant’s demurrer as to the third cause of action is OVERRULED. Defendant provided no legal basis and cited no legal authority as to why the instant set of facts are grounds for sustaining a demurrer as to this cause of action.

Fourth Cause of Action – Breach of Oral Contract.

After failing to present clear, legally supported arguments in the moving papers as to this cause of action, in its Reply brief, Defendant asserts that the oral contract alleged by Plaintiff would be barred by the statute of frauds. The Court is entirely unclear as to what Defendant is trying to argue on this point. Defendant continued to not cite any legal authority for its arguments.

In Plaintiff’s Complaint in Paragraph 74, Plaintiff incorporated the prior allegations of the Complaint.

Then, in Paragraphs 75-81, Plaintiff alleged:

Defendant represented to Plaintiff that if he invested in her Scheme, he would receive a return on his investment. Defendant recruited Plaintiff to deposit multiple, increasingly large sums of money in an electronic cryptocurrency Wallet, with the promise of significant profit. Plaintiff did actually deposit these sums in the Wallet. Defendant did not produce any return on investment, and, in fact, continued to make grandiose promises to entice and compel Plaintiff to sink larger and larger sums of money into her Scheme. Defendant’s proposition and Plaintiff’s affirmative action of investing in Defendant’s Scheme created an implied contract. Defendant clearly breached the implied contract by failing live up to any of her many promises. As a direct result of Defendant’s breach of oral contract to return Plaintiff’s investment, Plaintiff has suffered damages in an amount to be determined at trial.

 

(Compl. ¶75-81.)

 

To state a cause of action for breach of contract, Plaintiff must allege “(1) the existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) resulting damages to the plaintiff.”  (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.)  A cause of action for breach of contract is subject to demurrer if “it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.”  (Code Civ. Proc., §430.10(g).) A written contract must be pled verbatim in the body of the complaint, be attached to the complaint and incorporated by reference, or be pled according to its legal effect.  (Bowden v. Robinson (1977) 67 Cal.App.3d 705, 718.)  An allegation of an oral agreement must “set[] forth the substance of its relative terms.”  (Gautier v. General Tel. Co. (1965) 234 Cal.App.2d 302, 305.)

Here, it is unclear as to whether the Plaintiff is alleging an oral contract, or a contract implied by conduct. The caption of the Complaint refers to the Fourth Cause of action as a Breach of Oral Contract, and the Fourth Cause of Action in the body of the Complaint is labeled as a Breach of Oral Contract. However, in Paragraphs 79 and 80 of the Complaint, Plaintiff alleges that an implied contract was created and that an implied contract was breached. A cause of action for breach of contract is subject to demurrer if “it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.”  (Code Civ. Proc., §430.10(g).

 

Further, if Plaintiff is alleging an oral contract, the Complaint is entirely unclear as to the substance of the relative terms of the oral contract. An allegation of an oral agreement must “set[] forth the substance of its relative terms.”  (Gautier v. General Tel. Co. (1965) 234 Cal.App.2d 302, 305.)

 

Further, Plaintiff did not allege Plaintiff’s performance or excuse for nonperformance.

 

Tentative Ruling – Fourth Cause of Action – Breach of Oral Contract
Defendant’s demurrer as to the fourth cause of action is SUSTAINED with 20 days’ leave to amend.

Fifth Cause of Action – Breach of Contract
Defendant argues that Defendant has no contractual privity with Plaintiff, not only as to the fifth cause of action, but it appears as if Defendant is making this argument of a lack of contractual privity with respect to every cause of action. As to this argument, Defendant provides no legal authority or explanation as to its argument. Defendant’s argument on contractual privity is entirely unclear as to every cause of action, and the Court therefore finds it unavailing.

Further, as to Defendant’s Demurrer on page 15 from line 5 to line 25, Defendant provides no legal authority to support any of its arguments. Defendant made arguments as to what must be alleged, but provided no legal authority that the level of specificity Defendant urges must be alleged.

Defendant also argues that Plaintiff failed to establish the existence of a contract. The Court notes that this argument is outside the scope of a demurrer. Further, the Defendant makes arguments outside the scope of demurrer with respect to who actually signed the alleged agreement.

Plaintiff’s Opposition is equally unhelpful as Plaintiff provides no legal authority to support any of its arguments.

To state a cause of action for breach of contract, Plaintiff must allege “(1) the existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) resulting damages to the plaintiff.”  (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.)  A cause of action for breach of contract is subject to demurrer if “it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.”  (Code Civ. Proc., §430.10(g).) A written contract must be pled verbatim in the body of the complaint, be attached to the complaint and incorporated by reference, or be pled according to its legal effect.  (Bowden v. Robinson (1977) 67 Cal.App.3d 705, 718.) 

The existence of a contract alleged with adequate specificity at ¶84 when Plaintiff alleges that Defendant signed the Agreement. Further, ¶13 states the Agreement is Exhibit A. Plaintiff’s performance seems to be alleged at ¶85. Breach seems to be alleged at ¶87. Damages seems to be alleged at ¶88.

A cause of action for breach of contract is subject to demurrer only if “it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.”  (Code Civ. Proc., §430.10(g).)

Tentative Ruling – Fifth Cause of Action – Breach of Contract
The Demurrer to the 5th cause of action is overruled.

Sixth Cause of Action – Conversion
As stated in Regent Alliance Ltd. v. Rabizadeh:

“Conversion is generally described as the wrongful exercise of dominion over the personal property of another.[Citation.] The basic elements of the tort are (1) the plaintiff's ownership or right to possession of personal property; (2) the defendant's disposition of the property in a manner that is inconsistent with the plaintiff's property rights; and (3) resulting damages. [Citation.]” (Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119, 55 Cal.Rptr.3d 621.) “Conversion is a strict liability tort. The foundation of the action rests neither in the knowledge nor the intent of the defendant. Instead, the tort consists in the breach of an absolute duty; the act of conversion itself is tortious. Therefore, questions of the defendant's good faith, lack of knowledge, and motive are ordinarily immaterial.” (Burlesci v. Petersen (1998) 68 Cal.App.4th 1062, 1066, 80 Cal.Rptr.2d 704.)

 

(Regent Alliance Ltd. v. Rabizadeh (2014) 231 Cal.App.4th 1177, 1181.)

 

In Plaintiff’s Complaint in Paragraph 89, Plaintiff incorporates prior paragraphs of the Complaint.

 

In Paragraphs 90-97 of the Complaint, Plaintiff alleges:

 

At the behest of the Defendant, Plaintiff deposited thousands of dollars. over multiple transfers, into the Wallet she created and controlled. Defendant repeatedly requested more and more money in order to effectuate any return, due to the purported “double spend” nature of the transactions. There has never been a recorded instance in the history of Bitcoin of a successful “double spend” transaction, according to Investopedia. Defendant created Plaintiff’s Wallet containing all transactions related her Scheme and had control over the use and movement of funds therein. Upon information and belief, Defendant has removed, stolen, or otherwise secreted away Plaintiff’s cryptocurrency ownership and/or United States Denomination (USD) funds. Due to the aggressive and illicit acts of the Defendant, Plaintiff does not have access to his Wallet to assess the extent of the fiscal damage and/or access any remaining funds. By reason of the foregoing, Plaintiff has suffered damages in an amount to be determined at trial. The conduct of Defendant described above is outrageous. Defendant’s conduct that harmed the Plaintiff was malicious, oppressive, and in reckless disregard of the Plaintiff’s rights. The acts and omissions described above were willful and performed with actual or implied malice. Punitive and exemplary damages are therefore appropriate and should be imposed in this instance.

 

(Compl. ¶90-97.)

 

 

 

Tentative Ruling – Sixth Cause of Action – Conversion

Defendant’s demurrer as to the sixth cause of action for conversion is sustained with 20 days’ leave to amend. It is unclear and uncertain to the Court how these allegations sufficiently allege facts sufficient to constitute a cause of action for conversion.

 

Seventh Cause of Action – Promissory Estoppel

Although Defendant demurs on the ground that Plaintiff failed to state facts sufficient to constitute a cause of action, Defendant confusingly argues, “Plaintiff’s cause of action for promissory estoppel is predicated on communications, an alleged oral and written contract, to which Defendant Herrera Galvez was not privy, or a party, to wit; and for the same arguments provided in Defendant’s demur to causes of action one through six, this Seventh Cause of Action is defective, an erroneous naming of Defendant Herrera Galvez as a Defendant, and does not plead facts sufficient to constitute a cause of action.” (Def. Mot. p. 18.)

 

The Court notes that this argument is entirely unclear and that Defendant provides no legal authority to sustain the demurrer based on Defendant’s unclear argument.

 

The Opposition is also poorly written and makes no attempt at making a legal argument.

 

“The elements of a promissory estoppel claim are (1) a promise clear and unambiguous in its terms; (2) reliance by the party to whom the promise is made; (3) [the] reliance must be both reasonable and foreseeable; and (4) detriment-the party asserting the estoppel must be injured by his reliance.” (Jones v. Wachovia Bank (2014) 230 Cal.App.4th 935, 945.)

“Because promissory estoppel is an equitable doctrine to allow enforcement of a promise that would otherwise be unenforceable, courts are given wide discretion in its application. (US Ecology, Inc. v. State of California (2005) 129 Cal.App.4th 887, 902.)

In Plaintiff’s Complaint, Paragraph 98 incorporates the prior allegations of the Complaint.

In Paragraphs 99-101 of the Complaint, Plaintiff alleges:

Defendant made clear and unambiguous promises, in the form of written assurances and the Agreement, to safeguard and wisely invest Plaintiff’s numerous deposits into the cryptocurrency exchange wallet to which she had created and had access. Plaintiff relied, to his detriment, on the clear and unambiguous promises made by Defendant. By reason of the foregoing, Plaintiff has suffered damages in an amount to be determined at trial.

 

(Compl. ¶99-100.)

 

Here, Plaintiff did not allege that the reliance was reasonable and foreseeable. Further, Plaintiff did not allege that Plaintiff was injured by Plaintiff’s reliance.

 

Tentative Ruling – Seventh Cause of Action – Promissory Estoppel

Defendant’s demurrer as to the seventh cause of action is sustained with 20 days’ leave to amend.

 

Eighth Cause of Action – Fraudulent Misrepresentation

“ ‘The elements of fraud, which gives rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or “scienter”); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.’ “ (Small v. Fritz Companies, Inc. (2003) 30Cal.4th  167, 173 citing Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.)

(a)Misrepresentation

Fraud must be pled with specificity rather than with “‘general and conclusory allegations.’” (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.) The 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. (Lazar v. Superior Court (1996)12 Cal.4th 631, 645.)

 

Here, Defendant is not a corporate defendant; however, Plaintiff still did not meet the specificity requirements of alleging facts showing how, when, where, to whom, and by what means the representations were made.

 

(b)Knowledge of Falsity or scienter

Here, Plaintiff sufficiently alleged this element by alleging, “Defendant knew these statements were false when they were made.” (Compl. ¶106.)

 

(c)Intent to defraud, i.e., induce reliance

Here, Plaintiff sufficiently alleged this element by alleging, “Defendant intended for Plaintiff to rely on these false statements.” (Compl. ¶107.)

 

(d)Justifiable Reliance

Here, Plaintiff sufficiently alleged this element by alleging, “Plaintiff justifiably relied on the false statements when Plaintiff invested.” (Compl. ¶108.)

 

(e)Resulting Damage

Here, Plaintiff sufficiently alleged this element by alleging, “As a result of Defendant’s fraudulent conduct, Plaintiff has suffered damages in an amount to be determined at trial.” (Compl. ¶109.)

 

Tentative Ruling – Eighth Cause of Action – Fraudulent Misrepresentation

Defendant’s demurrer as to the eighth cause of action is sustained with 20 days’ leave to amend.