Judge: Donald F. Gaffney, Case: Kutzman v. HPT CW Properties, Date: 2022-12-21 Tentative Ruling

TENTATIVE RULING:

Demurrer to First Amended Complaint

Defendants Sonesta International Hotels Corporation and HPT CW Properties Trust (“Defendants”) demur to the first, second, and third causes of action of Plaintiff Rick Kutzman’s First Amended Complaint (“FAC”). For the following reasons, Defendants’ demurrer is SUSTAINED, with leave to amend.

A demurrer challenges the defects appearing on the face of the pleading or from other matters properly subject to judicial notice. (See Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) The issue is the sufficiency of the pleading, not the truth of the facts alleged. (Cundiff v. GTE Cal., Inc. (2002) 101 Cal.App.4th 1395, 1404-05.) Questions of fact cannot be decided on demurrer. (Berryman v. Merit Prop. Mgmt., Inc. (2007) 152 Cal.App.4th 1544, 1556.) Because a demurrer tests only the sufficiency of the complaint, a court will not consider facts that have not been alleged in the complaint unless they may be reasonably inferred from the matters alleged or are proper subjects of judicial notice. (Hall v. Great W. Bank (1991) 231 Cal.App.3d 713, 718 n.7.)

First Cause of Action for Violation of Civil Code Section 1942.5

The FAC alleges Defendants and their employees retaliated against Plaintiff after Plaintiff indicated that he would not be able to pay rent due to COVID. (FAC ¶ 23.) The FAC alleges Defendants violated Civil Code section 1942.5 by cutting off all services, refusing to make repairs, refusing to clean Plaintiff’s room, and harassing Plaintiff so that he would move out. (Id.)

California Civil Code sections 1940 through 1956 provide numerous statutory rights to “all persons who hire dwelling units located within this state including tenants, lessees, boarders, lodgers, and others, however denominated.” (Civ. Code, § 1940(a).) As an initial matter, the FAC does not identify the subdivision on which Plaintiff’s section 1942.5 claim is based. Nevertheless, section 1940 provides for three exceptions to the definition of “persons who hire.” First, “persons who hire” does not include a person who maintains “[t]ransient occupancy in a hotel, motel, residence club, or other facility when the transient occupancy is or would be subject to tax under Section 7280 of the Revenue and Taxation Code [because the occupancy is 30 days or less].” (Civ. Code, § 1940(b)(1); Revenue. & Taxation Code, § 7280.) Second, the definition does not include a person who maintains a transient occupancy of 30 days or less when the person fails to pay room or related charges. (Civ. Code, § 1940(b)(1).) Third, the definition does not include a person who maintains an occupancy at a hotel or motel where an innkeeper “retains a right of access to and control of the dwelling unit” and the hotel or motel “provides or offers all of the following services to all of the residents”:

(A) Facilities for the safeguarding of personal property pursuant to Section 1860.

(B) Central telephone service subject to tariffs covering the same filed with the California Public Utilities Commission.

(C) Maid, mail, and room services.

(D) Occupancy for periods of less than seven days.

(E) Food service provided by a food establishment, as defined in Section 113780 of the Health and Safety Code, located on or adjacent to the premises of the hotel or motel and owned or operated by the innkeeper or owned or operated by a person or entity pursuant to a lease or similar relationship with the innkeeper or person or entity affiliated with the innkeeper.

(Civ. Code., § 1940(b)(2)(A)-(E).)

The FAC does not allege sufficient facts from which it is plausible to infer that Plaintiff does not fall within any of the three exceptions to the definition of “persons who hire.” The FAC does not allege that Defendants do not charge Plaintiff a room tax. Additionally, the FAC does not allege that Defendants do not offer or provide “all of the following services to all of the residents”: facilities for safeguarding property, central telephone service, maid service, mail service, room service, occupancy of periods for seven days or less, and food service provided by a food establishment. The demurer to the first cause of action is sustained.

Second Cause of Action for Negligent Hiring and Supervision

“An employer can be held liable for negligent supervision if it knows or has reason to believe the employee is unfit or fails to use reasonable care to discover the employee’s unfitness. [Citation.] ‘[T]here can be no liability for negligent supervision “in the absence of knowledge by the principal that the agent or servant was a person who could not be trusted to act properly without being supervised.” ’ ” (Alexander v. Community Hospital of Long Beach (2020) 46 Cal.App.5th 238, 253.)

The FAC alleges Defendants “should have trained their managers, employees, and agents how to properly treat Plaintiff during the pandemic, who had lived continuously at the Subject Property for longer than 30 days, and to advise such managers, employees, and agents that Plaintiff could not be forcefully removed from the hotel without judicial process in the event that there was a dispute regarding his tenancy, nor could services be cut off from Plaintiff during the period of the pandemic when Plaintiff was unable to pay rent.” (FAC ¶ 28.)

The FAC does not allege facts that would demonstrate Defendants had or should have had knowledge that their employees were unfit or that Defendants failed to use reasonable care to discovery their employees’ unfitness. The demurrer to the second cause of action is sustained.

Third Cause of Action for Breach of the Implied Covenant of Quiet Enjoyment

“In the absence of language to the contrary, every lease contains an implied covenant of quiet enjoyment, whereby the landlord impliedly covenants that the tenant shall have quiet enjoyment and possession of the premises. [Citations.] The covenant of quiet enjoyment ‘insulates the tenant against any act or omission on the part of the landlord, or anyone claiming under him, which interferes with a tenant's right to use and enjoy the premises for the purposes contemplated by the tenancy. [Citations.]’ [Citation.]” (Ginsberg v. Gamson (2012) 205 Cal.App.4th 873, 896, quoting Andrews v. Mobile Aire Estates (2005) 125 Cal.App.4th 578, 588.) The implied covenant of quiet enjoyment or possession may be breached in multiple ways, but is inextricably tied to eviction. (Ginsberg, 205 Cal.App.4th at 897.)

If the landlord ousts the tenant, there is an actual eviction. (Petroleum Collections Inc. v. Swords (1975) 48 Cal.App.3d 841, 847.) If the landlord’s acts or omissions affect the tenant’s use of the property and compel the tenant to vacate, there is a constructive eviction. (Green v. Superior Court (1974) 10 Cal.3d 616, 625, fn. 10.) In either case, the tenant must vacate. (Lori, Ltd. v. Wolfe (1948) 85 Cal.App.2d 54, 65 [“In order that there be a constructive eviction it is essential that the tenant should vacate the property. There is no constructive eviction if the tenant continues in possession of the premises however much he may be disturbed in the beneficial enjoyment”].) Many courts have accordingly repeated the general premise that “the covenant of quiet enjoyment is not broken until there has been an actual or constructive eviction....” (Petroleum Collections, 48 Cal.App.3d at 847.)

However, in Guntert v. City of Stockton (1976) 55 Cal.App.3d 131, the court distinguished claims in which the landlord has actually or constructively ousted the tenant from those in which the landlord’s interference with the tenant’s enjoyment or use of the property does not lead to ouster. The Guntert court recognized that a tenant has alternative remedies to respond to the landlord's interference and, instead of vacating, may “stand upon the lease and sue for damages.” (Id. at 140.) “The rule requiring ouster or surrender prior to suit for wrongful eviction does not preclude the tenant from his election to stand upon the lease, remain in possession and sue for breach of contract damages.” (Id. at 141.) Similarly, in Cunningham v. Universal Underwriters (2002) 98 Cal.App.4th 1141, 1153, the court explained: “While a claim for breach of the covenant of quiet enjoyment is similar to a constructive eviction claim, the critical difference is that the latter claim may not be brought until the tenant has vacated the property.” Thus, breach of the implied covenant of quiet enjoyment encompasses claims for wrongful eviction, and also claims in which the tenant’s use of the premises is disturbed, but the tenant remains in possession. (Ginsberg, 205 Cal.App.4th at 898.)

An alleged breach of the covenant of quiet enjoyment that, as here, does not result in a wrongful constructive or actual eviction is a breach of contract. (Bevis v. Terrace View Partners, LP (2019) 33 Cal.App.5th 230, 250-251; Ginsberg, 205 Cal.App.4th at 898-902.) Plaintiff did not attach copies of the parties’ contract or allege the substance of the contract’s relevant terms, and even concedes that the terms of the contract could have been pled with more specificity. The demurrer to the third cause of action is sustained.

Defendants’ demurrer for uncertainty is overruled.  The FAC is not “so incomprehensible that [Defendants] cannot reasonably respond.” (Lickiss v. Financial Indus. Regulatory Auth. (2010) 208 Cal.App.4th 1125, 1135; see also A.J. Fistes Corp. v. GDL Best Contractors, Inc. (2019) 38 Cal.App.5th 677, 695.)

Should Plaintiff desire to file an amended complaint addressing the issues in this ruling, Plaintiff must file and serve within 30 days of service of notice of ruling.

Defendants to give notice.