Judge: Deborah C. Servino, Case: 30-2022-01253272, Date: 2022-07-22 Tentative Ruling

Defendant Craig R. Oosdyke’s demurrer to Plaintiffs Robert Ward Macey V.’s and Emily S. Grimmond’s Complaint is overruled.

A demurrer presents an issue of law regarding the sufficiency of the allegations set forth in the complaint.  (Lambert v. Carneghi (2008) 158 Cal.App.4th 1120, 1126.) The challenge is limited to the “four corners” of the pleading (which includes exhibits attached and incorporated therein) or from matters outside the pleading which are judicially noticeable under Evidence Code sections 451 or 452.  Although California courts take a liberal view of inartfully drawn complaints, it remains essential that a complaint set forth the actionable facts relied upon with sufficient precision to inform the defendant of what plaintiff is complaining, and what remedies are being sought.  (Leek v. Cooper (2011) 194 Cal.App.4th 399, 413.)  On demurrer, a complaint must be liberally construed.  (Code Civ. Proc., § 452; Stevens v. Superior Court (1999) 75 Cal.App.4th 594, 601.)  All material facts properly pleaded, and reasonable inferences, must be accepted as true.  (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 966-967.)

Breach of Oral Contract as Third-Party Beneficiary (First Cause of Action)

“A cause of action for breach of contract requires proof of the following elements: (1) existence of the contract; (2) plaintiff's performance or excuse for nonperformance; (3) defendant's breach; and (4) damages to plaintiff as a result of the breach.” (Miles v. Deutsche Bank National Trust Company (2015) 236 Cal.App.4th 394, 402; see also Prob. Code, § 21700 [regarding contracts to make a will].)  To plead a third-party beneficiary claim, Plaintiffs must allege facts to show the contracting parties intended to benefit that person and the intent must appear in the terms of the agreement.  (Brinton v. Bankers Pension Services, Inc. (1999) 76 Cal.App.4th 550, 558.)

Here, Plaintiffs allege that Defendant and their mother, Peggy Oosdyke, entered into an oral agreement in 2015 as to the family home.  Plaintiffs were the intended beneficiaries of the agreement.  Craig breached the contract when he executed his will in 2021.  As a result, Plaintiffs have suffered damages in the form of a diminished inheritance.  (Complaint, at ¶¶ 71-73, 76, 78, 80.)  These allegations are sufficient to state a claim for breach of contract.

Defendant argues that the statute of frauds, as stated in Civil Code section 1624 precludes Plaintiffs’ claim for breach of contract.  The statute of frauds provides that certain contracts are invalid, including agreements regarding interests in real property unless “they, or some note or memorandum thereof, are in writing and subscribed by the party to be charged or by the party's agent . . . ” (Civ. Code, § 1624.)  Here, the Complaint alleges that the terms of the oral agreement between Defendant and Peggy J. Oosdyke are reflected in writing. Specifically, Plaintiffs allege that the oral contract is reflected in writing in the Oosdyke Trust. (Complaint, at pp. 7-8.) Further, the Complaint includes allegations that the oral agreement is reflected in writing in Peggy Oosdyke’s journals. (Complaint, at pp. 6-8; see generally, King v. Stanley (1948) 32 Cal.2d 584, 588 [informal memorandum is sufficient]; Seck v. Foulks (1972) 25 Cal.App.3d 556, 566.) 

Defendant also argues that the agreement cannot be timely preformed.  On the contrary, the Complaint’s allegations suggest that the agreement can be performed during Defendant’s lifetime, as the agreement was for Defendant to prepare an estate plan consistent with Peggy Oosdyke’s wish for the home to pass to Plaintiffs.

Defendant also contends that the parol evidence rule precludes this claim.  The parol evidence rule “generally prohibits the introduction of any extrinsic evidence, whether oral or written, to vary, alter, or add to the terms of an integrated written instrument.”  (Casa Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336, 343.)  The rule does not prohibit the introduction of extrinsic evidence to explain the meaning of a written contract if the meaning urged is one to which the written contract terms are reasonably susceptible.  (Ibid.) Defendant points to provisions of the Oosdyke Trust regarding the property passing to Defendant under certain circumstances.  He asserts that these provisions allegedly contradict the oral agreement.  The alleged contradictions that Defendant points out, do not render this cause of action defective.  Pursuant to the Complaint, it does not appear that Plaintiffs seek simply to have the deed or trust set aside.  Rather, they seek a constructive trust that would eventually result in Plaintiffs’ inheritance of the family home.  (Complaint, at p. 14.)  

Defendant contends that the agreement violates Probate Code section 21700, subdivision (a)(3).  Subdivision (a)(3) requires a contract to make a will be in writing and signed by the decedent.  This contention is similarly unavailing.  Section 21700 provides alternative ways to establish a contract to make a will, such as evidence of an agreement or promise between the decedent and the claimant. (See Prob. Code, § 21700, subd. (a)(4).)  This has been alleged in the Complaint. (Complaint, at p. 6.)  The demurrer as to the first cause of action is overruled.

Intentional Interference with Expected Inheritance (Second Cause of Action)

The elements of intentional interference with expected inheritance (“IIEI”) are (1) plaintiffs had an expectancy of an inheritance; (2) defendant knew of that expectancy; (3) defendant engaged in conduct determined to be wrongful; (4) by engaging in this conduct, defendant intended to interfere with plaintiffs’ expected inheritance; (5) there was a reasonable certainty that plaintiffs would have received the inheritance if defendant had not interfered; (6) plaintiffs were harmed; (7) defendant’s conduct was a substantial factor in causing that harm. (Beckwith v. Dahl (2012) 205 Cal.App.4th 1039, 1054-1057.)

In Beckwith, the plaintiff, Beckwith, was in a relationship with MacGinnis who shared an unsigned will he had saved on his computer, dividing his estate between Beckwith and MacGinnis’ sister (Dahl).  MacGinnis never printed or signed the will.  (See Beckwith v. Dahl (2012) 205 Cal.App.4th 1039, 1046-1048.)  The court of appeal recognized that Beckwith was left without recourse in probate, and held that “. . . a court should recognize the tort of IIEI if it is necessary to afford an injured plaintiff a remedy.” (Id. at p. 1056.) The court reasoned that “[t]he integrity of the probate system and the interest in avoiding tort liability for inherently speculative claims are very important considerations.” (Ibid.) However, a court should not permit the “. . . drastic consequence of an absolute rule which bars recovery in all . . . cases . . . when a new tort cause of action can be defined in such a way so as to minimize the costs and burdens associated with it.” (Ibid.)

Here, Plaintiffs do not have an adequate probate remedy. While they are the heirs of Peggy Oosdyke’s estate, the estate itself has no assets.  The subject of the lawsuit, the Macey Family Home, was funded into the Oosdyke Trust and is not an asset belonging to Peggy Oosdyke’s estate. (Complaint, at ¶¶ 63, 78, 90.)  Plaintiffs have alleged facts to support standing, contrary to Defendant’s argument.

Defendant additionally argues that Plaintiffs fail to allege the element of causation.  In paragraphs 97 and 98 of the Complaint, Plaintiffs allege that they have sustained damages including a loss of equitable interest in the family home as a result of Defendant’s conduct in interfering with what should have been their inheritance. This is sufficient to plead causation.  In addition, in paragraphs 84 through 98 of the Complaint, Plaintiffs have adequately alleged facts to support the remaining elements of IIEI.

With respect to both causes of action, Defendant argues that because the Oosdyke Trust is still revocable and can be amended, Plaintiffs have not yet suffered any damages, and thus their claims are premature. No legal authority is cited to support this argument. 

Finally, Defendant argues that this case belongs in Probate Division.  Breach of contract and IIEI are civil claims.  As discussed above, Plaintiffs have pled facts suggesting they have no adequate probate remedy with respect to their claims, because the estate of Peggy Oosdyke lacks assets. Furthermore, Plaintiffs have a right to a jury in this action, having posted jury fees.  (Not. of Posting Jury Fees [ROA 19].)   

Accordingly, based on the foregoing, the demurrer is overruled.  Within 15 days, Defendant shall file an answer to the Complaint.  Defendant shall serve the answer in accordance with the Code of Civil Procedure.

Plaintiffs shall give notice of the ruling.