Judge: Deirdre Hill, Case: 22TRCV00417, Date: 2023-02-10 Tentative Ruling

Case Number: 22TRCV00417    Hearing Date: February 10, 2023    Dept: M

Hearing Date:                         February 10, 2023

Moving Parties:                      Defendants Eun Jae Park and Eun Bin Park

Responding Party:                  Plaintiff Mary Maguire

(1)   Demurrer to FAC

(2)   Motion to Strike Portions of FAC

            The court considered the moving, opposition, and reply papers.

RULING

The demurrer is OVERRULED as to the 1^st cause of action and SUSTAINED WITHOUT LEAVE TO AMEND as to the 2^nd and 3^rd causes of action.  The motion to strike is ruled on as stated below.  Defendants Eun Bin Park and Eun Jae Park are ordered to file an answer within ten days.

BACKGROUND

            On June 2, 2022, Mary Maguire filed a complaint against Sung Soo Park, Kyung Mee Jyung, Eun Bin Park, Eun Jae Park, Awesome Medical Company, and HepaHope for (1) fraud and deceit, (2) conversion, (3) elder abuse under Welfare & Institutions Code § 15610 et seq., (4) intentional infliction of emotional distress, (5) negligent infliction of emotional distress, and (6) breach of contract. 

On October 17, 2022, the court sustained with leave to amend defendant Eun Jae Park’s

demurrer as to the 1st, 3rd, and 4th causes of action and sustained the demurrer without leave to

amend as to the 2nd and 5th causes of action.  The motion to strike was deemed moot.

On November 4, 2022, plaintiff filed a FAC for (1) fraud and deceit, (2) elder abuse, (3) IIED, and (4) breach of contract.

            On January 25, 2023, the court granted the motion to quash service of summons as to the proofs of service of summons filed on September 29, 2022 as to defendants Sung Soo Park and Kyung Mee Jyung.

LEGAL AUTHORITY

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.  “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.”  SKF Farms v. Superior Court (1984) 153 Cal. App. 3d 902, 905.  “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 v. Mirda (2007) 147 Cal. App. 4th 740, 747.

“The court may, upon a motion . . ., or at any time in its discretion, and upon terms it deems proper:  (a) Strike any irrelevant, false, or improper matter inserted in any pleading.  (b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.”  CCP §436(b).

            CCP §431.10 states:  “(a) A material allegation in a pleading is one essential to the claim or defense and which could not be stricken from the pleading without leaving it insufficient as to that claim or defense. 

(b) An immaterial allegation in a pleading is any of the following:  (1) An allegation that is not essential to the statement of a claim or defense.  (2) An allegation that is neither pertinent to nor supported by an otherwise sufficient claim or defense.  (3) A demand for judgment requesting relief not supported by the allegations of the complaint or cross-complaint. 

(c) An ‘immaterial allegation’ means ‘irrelevant matter’ as that term is used in Section 436.”

The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice.  CCP §437.

DISCUSSION

            Defendants Eun Jae Park and Eun Bin Park demur to the 1^st through 3^rd causes of action in the FAC on the ground that they fail to state sufficient facts to constitute a cause of action.

            The FAC alleges that defendants use a series of defunct business entities to make it appear as through they are wealthy individuals who own and operate several successful companies.  Defendants proclaim that they are the owners of valuable patents in the medical field.  Sung Soo Park claims to be a medical doctor.  Defendants made these and other false representations to plaintiff to trick plaintiff into leasing the subject property in 2019.  FAC, ¶11.  In May 2019, defendants conspired to trick plaintiff into agreeing to lease the subject property to them.  Defendants, in their oral and written communications with plaintiff, represented that they were very wealthy individuals who owned valuable medical patents and companies.  Specifically, defendants represented that Sung Soo Park was owner and operator of defendant Awesome Medical Company, LLC from which he made a salary of $750,000 per year.  They also claimed that he was the owner and operator of HepaHope, Inc. from which he made a salary of $350,000 per year.  These claims were false and defendants knew them to be false and intended that plaintiff would rely on such statements in agreeing to lease the subject property to them.  Id., ¶12.

            The FAC further alleges that in early May 2019, defendant Eun Jae Park told plaintiff’s agent Molly Hobin that his dad defendant Sung Soo Park was a doctor who held many valuable patents.  He told Hobin that he and the other defendants were in the process of looking for 20,000 square feet of commercial space in El Segundo to house their company.  These statements were not true.  In reality, defendants were not paying their rent for their commercial space and would be evicted for such later in the year.  Id., ¶13.  In early May 2019, defendant Eun Jae Park and the other defendants told Hobin that they had sold their house in Palos Verdes and that that was the reason they were looking for a rental.  On the rental application, defendants Eun Jae Park and Eun Bin Park, who helped their parents fill out the rental application, stated that the reason for leaving their prior property was that they had “sold it,” but this was not true as they had not sold their property; rather it was foreclosed upon by a bank.  These statements were made to Hobin and on the rental application to create a false impression that defendants were wealthy people who could easily afford the rent being charged by plaintiff for her property.  Id., ¶14.  On the rental application dated May 6, 2019, defendants Eun Jae Park and Eun Bin Park filled out for their parents, the sons stated that their dad worked for two companies, Awesome Medical Company LLC and Hepahope, Inc.  Neither of these company appear to have actually existed other than on paper and both are listed as suspended on the California Secretary of State’s website.  The rental application lists Sung Soo Park’s income from these two companies as $1.1 million.  Id., ¶15.

The FAC also alleges that after defendants scammed and influenced plaintiff into relinquishing control of the property, defendants continued to make false promises and representations to plaintiff.  Defendants conspired to use coercion, misrepresentations, and undue influence against plaintiff in an effort to continue to not pay the rent that was due.  They also made false promises and representations regarding their ability to pay future rent, their ability to move out, and their future plans with regard to the property.  Id., ¶16.  They refused to provide information regarding the property and refused to allow plaintiff entry despite plaintiff’s proper and lawful notices.  They refused to cooperate with plaintiff and allow plaintiff or her representatives onto the property (1) for required insurance verification procedures, (2) to allow plaintiff to access and fix a heater that defendants complained about and that at the time was under warranty, and (3) plaintiff’s attempts to market the property for sale.  Defendant Kyung Mee Yung impersonated plaintiff to forestall lawful service of process on her.  Id., ¶17.  Beginning in 2020 and continuing to 2022, defendants exercised total control over the subject property and refused to yield such control to plaintiff, despite plaintiff’s legal ownership of the property.  Id., ¶18.

The demurring defendants Eun Jae Park (“EJ Park”) and Eun Bin Park (“EB Park”) are alleged to be the sons, agents, and authorized representatives of defendants Sung Soo Park and Kyung Mee Jyung.  Plaintiff alleges that Sung Soo Park and EB Park previously resided at the property.

                        1^st cause of action for fraud

The elements of fraud 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.” Charnay v. Cobert (2006) 145 Cal. App. 4th 170, 184.  Fraud, including negligent misrepresentation, must be pled with specificity. Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.  “The particularity demands that a plaintiff plead facts which show how, when, where, to whom, and by what means the representations were tendered.”  Cansino v. Bank of America (2014) 224 Cal. App. 4th 1462, 1469.

Plaintiff alleges that in May 2019, defendants knowingly made false, fraudulent, and misleading representations to plaintiff regarding the true nature of their employment, their wealth, their business history, and their prior rental history in an attempt to gain possession and control of the subject property from plaintiff.  Defendants EJ Park, EB Park, and Sung Soo Park misrepresented that Sung Soo Park was a medical doctor who owned a big company with valuable medical patents.  FAC, ¶20.  In early May 2019, defendant EJ Park told Hobin that he and the other defendants were in the process of looking for 20,000 square feet of commercial space in El Segundo to house their company.  These statements were not true.  Id., ¶21.  In early May 2019, defendant EJ Park and the other defendants told Hobin that they sold their house in Palos Verdes and that that was the reason they were looking for a rental.  On the rental application for plaintiff’s property, defendants EJ Park and EB Park, who helped their parents fill out the rental application, stated that the reason for leaving their prior property was that they had “sold it,” but the statements were not true as the property had been foreclosed upon.  The statements were made to Hobin and on the rental application to create a false impression that defendants were wealthy people who could easily afford the rent being charged by plaintiff for her property.  Id., ¶22.

The FAC further alleges that on the rental application dated May 6, 2019, that defendants EJ Park and EB Park filled out for their parents, the sons stated that their dad worked for two companies, Awesome Medical Company LLC and HepaHope, Inc.  Neither of these companies appear to have actually existed other than on paper, and both are listed as suspended on the California Secretary of State’s website.  The rental application lists Sung Soo Park’s income from these two companies as $1.1 million.  This was not true.  Additionally, defendants made numerous false statements and represented themselves to plaintiff as legitimate in an attempt to convince plaintiff that defendants were suitable renters for plaintiff’s property and would pay the rent due.  Defendants represented to plaintiff that they were wealthy individuals who made a lot of money from the companies that they owned and controlled, that they had good history as tenants, and that they would pay all rent when due and vacate the property upon expiration of the lease.  Id., ¶23.

The FAC further alleges that these representations and documents were false and defendants knew them to be false.  Id., ¶24.  Plaintiff was unaware of the falsity and justifiably relied upon them.  Id., ¶25.  Plaintiff could not have with reasonable diligence have discovered defendants’ misrepresentations.  Id., ¶26.

The court finds that the allegations are sufficient to meet the elements and are pled with particularity.

The demurrer is OVERRULED as to the 1^st cause of action.

                        2^nd cause of action for violation of Welfare and Institutions Code §§ 15610, et seq.

            Financial elder abuse occurs when a person takes the property of an elder for a wrongful use or with intent to defraud or by undue influence.  See Welf. & Inst. Code § 15610.30(a).  A person is deemed to have taken the property when he or she has deprived an elder of any property right.  See id. § 15610.30(c).  Although bad faith or intent to defraud is no longer required, wrongful use of property must still be alleged.  Stebley v. Litton Loan Servicing, LLP (2011) 202 Cal. App. 4th 522, 527-28.  “A person . . . shall be deemed to have taken . . . property for a wrongful use if . . . the person  . . . takes  . . . the property and the person . . . knew or should have known that this conduct is likely to be harmful to the elder . . . .”  Id. § 15610.30(b).

            The FAC alleges the same as under the 1^st cause of action.

            The court finds that the allegations are insufficient as to intent to defraud or undue influence of an elder.  The allegations do not support that defendants knew or should have known that their conduct was likely to be harmful to plaintiff.  Rather the FAC alleges that the misrepresentations were made to Hobin (and not to plaintiff) and that the rental application was to The Hobin Company.  There are no allegations that defendants were aware that plaintiff was an elder before making the misrepresentations or entering into the lease agreement.  Further, the allegations do not show that moving defendants wrongfully took property as they did not enter into the lease agreement for possession of the property. 

            The demurrer is SUSTAINED WITHOUT LEAVE TO AMEND as to the 2^nd cause of action.

                        3^rd cause of action for intentional infliction of emotional distress

             The elements of an intentional infliction of emotional distress cause of action are:  (1) extreme and outrageous conduct by the defendant; (2) intention to cause or reckless disregard of the probability of causing emotional distress; (3) severe emotional suffering; and (4) actual and proximate causation of the emotional distress.  See Moncada v. West Coast Quartz Corp. (2013) 221 Cal. App. 4th 768, 780; Wilson v. Hynek (2012) 207 Cal. App. 4th 999, 1009.  To satisfy the element of extreme and outrageous conduct, defendant’s conduct “‘must be so extreme as to exceed all bounds of that usually tolerated in a civilized society.’”  Moncada, supra, at 780 (citation omitted).

            “Behavior may be considered outrageous if a defendant (1) abuses a relation or position which gives him power to damage the plaintiff’s interest; (2) knows the plaintiff is susceptible to injuries through mental distress; or (3) acts intentionally or unreasonably with the recognition that the acts are likely to result in illness through mental distress.”  McDaniel v. Gile (1991) 230 Cal. App. 3d 363, 372.

“[I]t is not enough that the defendant has acted with an intent which is tortious or even criminal, or that he has intended to inflict emotional distress, or even that his conduct has been characterized by ‘malice,’ or a degree of aggravation which would entitle the plaintiff to punitive damages for another tort.”  Cochran v. Cochran (1998) 65 Cal.App.4th 488, 496.  “Liability has been found only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community.”  Id.  While there is no bright-line as to what constitutes outrageous conduct and thus this involves a case-by-case analysis, courts can determine whether conduct was sufficiently outrageous at the demurrer stage.  Id. at 494.  However, when reasonable persons may differ, it is for the jury, subject to the control of the Court, to determine whether, in the particular case, the conduct has been sufficiently extreme and outrageous to result in liability.¿ Alcorn v. Anbro Engineering, Inc. (1970) 2 Cal.3d 493, 499.

The court finds that the allegations are insufficient as they do not show extreme and outrageous conduct.  Further, plaintiff did not allege anything more in the FAC after the court sustained the demurrer to this cause of action with leave to amend.  Plaintiff does not address in the opposition.

The demurrer is SUSTAINED WITHOUT LEAVE TO AMEND as to the 3^rd cause of action.

            Motion to Strike

            Defendants request that the court strike 2:3 (“punitive damages”), 8:21-23 [¶28] (“. . . maliciously, oppressively and fraudulently . . . punitive damages.”), 11:10-12 [¶38] (attorney’s fees), 11:13-15 [¶39] (“. . . maliciously, oppressively and fraudulently . . . punitive damages.”), 11:16-17 [¶40] (treble damages under Civil Code §3345), 14:1-3 [¶49] (“. . . maliciously, oppressively and fraudulently . . . punitive damages.”), 15:6-8, prayer 3 (punitive damages), 15:9-11, prayer 5 (attorney’s fees), 15:12-13, prayer 6 (treble damages under Civil Code §3345), and 15:14-15, prayer 7 (damages double value of property wrongfully taken pursuant to Probate Code §859).

            The court rules as follows:  As to punitive damages, the allegations are sufficient as plaintiff has adequately pled fraudulent conduct by moving defendants and thus a basis for recovery of punitive damages.  The motion is DENIED as to 2:3, para. 28 (under the 1^st cause of action for fraud), and prayer 3 except the court STRIKES the amount.  See Civil Code §3295(e) (“No claim for exemplary damages shall state an amount or amounts.”).

The motion is GRANTED as to paras. 38, 39, 40, 49, and prayer 5, 6, and 7 in light of the ruling on the demurrer as to the 2^nd and 3^rd causes of action.

Moving defendants are ordered to give notice of this ruling.