Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 205 

 

 

MOVING PARTY: Defendant Essex Property Trust, Inc. 

 

RESPONDING PARTY: Plaintiff Jorie Esposito 

 

BACKGROUND 

This case arises from a landlord tenant dispute.  Plaintiff Jorie Esposito entered into a lease agreement with Defendant Essex Property Trust, Inc. for property located at 4750 Lincoln Blvd, Marina Del Rey, California (the “Property”).  Upon moving in, Plaintiff noticed the kitchen sink pipe was loose; the pipe was leaking, and the inside of the kitchen cabinet had water damage and a moldy smell.  (Compl. ¶ 9.)  The washer and dryer also needed to be replaced.  (Ibid.)   

After Plaintiff requested a repair of these issues, Defendant replaced the washer dryer and fixed the leaking pipe.  (Compl. ¶12.)  Defendant also scheduled an inspection with Benchmark, an environmental company that conducts mold tests, to address the mold and water damage in the kitchen cabinet.  (Compl. ¶13.)  Defendant relocated Plaintiff to another unit until the work on her kitchen cabinet was completed.  (Compl. ¶15.)   

Plaintiff requested a second mold inspection report from Benchmark, and Defendant informed Plaintiff that the second report showed it was safe for Plaintiff to move back into her unit.  (Compl. ¶17.)  Plaintiff then requested that all filters and vents be replaced and cleaned by Defendant.  Defendant replaced the filters, but did not clean the vents.  (Compl. ¶18.)   

Thereafter, Plaintiff ordered a professional mold test from a different company, and its report showed untreated elevated levels of mold present in Plaintiff’s unit.  The report concluded a large portion of the unit was uninhabitable until proper remedial measures were taken.  (Compl. ¶21.)   Plaintiff also saw a lung specialist who concluded that Plaintiff had mycobacterium adium complex, a condition associated with mold exposure.  (Compl. ¶20.) 

The operative complaint alleges claims for (1) breach of warranty of habitability (violation of Civil Code § 1941.1), (2) breach of warranty of habitability (violation of Health & Safety Code § 17920.3), (3) negligence – premises liability, (4) nuisance, (5) intentional infliction of emotional distress, (6) breach of contract, (7) breach of the covenant of quiet possession, (8) fraud/deceit/intentional misrepresentation of fact, and (9) breach of the implied covenant of good faith and fair dealing.   

This hearing is on Defendant’s demurrer and motion to strike.  Defendant argues that (1) Plaintiff’s fifth cause of action for intentional infliction of emotional distress fails because Plaintiff has not alleged outrageous conduct; (2) Plaintiff’s sixth cause of action for breach of contract fails because Plaintiff failed to attach the contract or to state verbatim the terms of the contract and the claim is also duplicative of her breach of habitability claims; (3)  Plaintiff’s seventh cause of action for breach of the covenant of quiet possession fails because Defendant did not substantially interfere with Plaintiff’s use or enjoyment of the unit; (4) Plaintiff’s eighth cause of action for fraud fails because Plaintiff has not alleged the claim with the required specificity; and (5) Plaintiff’s ninth cause of action for breach of the implied covenant of good faith and fair dealing fails because Plaintiff has not alleged that Defendant consciously and deliberately acted to deprive Plaintiff of the benefits of their contract and the claim is also duplicative of Plaintiff’s breach of contract claim.  Defendant further moves to strike Plaintiff’s claim for punitive damages and request for attorneys’ fees.   

LEGAL STANDARD 

“[A] demurrer tests the legal sufficiency of the allegations in a complaint.” (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.)  A demurrer can be used only to challenge defects that appear on the face of the pleading under attack or from matters outside the pleading that are judicially noticeable.  (See Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994 (in ruling on a demurrer, a court may not consider declarations, matters not subject to judicial notice, or documents not accepted for the truth of their contents).)  For purposes of ruling on a demurrer, all facts pleaded in a complaint are assumed to be true, but the reviewing court does not assume the truth of conclusions of law. (Aubry v. Tri-City Hosp. Dist. (1992) 2 Cal.4th 962, 967.)  

Further, the court may, upon motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading.  (Code Civ. Proc., § 436, subd. (a).)  The court may also strike 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. (Code Civ. Proc., § 436, subd. (b).)  The grounds for a motion to strike are that the pleading has irrelevant, false, or improper matter, or has not been drawn or filed in conformity with laws.  (Code Civ. Proc., § 436.)  The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. (Code Civ. Proc., § 437.) 

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (court shall not “sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment”); Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037 (“A demurrer should not be sustained without leave to amend if the complaint, liberally construed, can state a cause of action under any theory or if there is a reasonable possibility the defect can be cured by amendment.”); Vaccaro v. Kaiman (1998) 63 Cal.App.4th 761, 768 (“When the defect which justifies striking a complaint is capable of cure, the court should allow leave to amend.”).)  The burden is on the complainant to show the Court that a pleading can be amended successfully. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)  

DISCUSSION 

Intentional Infliction of Emotional Distress 

The elements of a claim for intentional infliction of emotional distress are “(1) extreme and outrageous conduct by the defendant with the intention of causing, or reckless disregard of the probability of causing emotional distress, (2) the plaintiff’s suffering severe or extreme emotional distress, and (3) actual and proximate causation of the emotional distress by the defendant’s outrageous conduct.”  (Wilson v. Hynek (2012) 207 Cal.App.4th 999, 1009.)  To be outrageous, conduct must be “so extreme as to exceed all bounds of that usually tolerated in a civilized community.”  (Id.)  The defendant must have engaged in conduct “intended to inflict injury or engaged in with the realization that injury will result.  It is not enough that the conduct be intentional and outrageous.  It must be conduct directed at the plaintiff, or occur in the presence of a plaintiff of whom the defendant is aware.”  (Christenson v. Superior Court (1991) 54 Cal.3d 868, 903.)   

To avoid a demurrer, the plaintiff must allege with “great specificity the acts which he or she believes are so extreme as to exceed all bounds of that usually tolerated in a civilized society.”  (Vasquez v. Franklin Management Real Estate Fund, Inc. (2013) 222 Cal.App.4th 819, 832.)  “Whether behavior is extreme or outrageous is a legal determination to be made by the court, in the first instance.”  (Faunce v. Cate (2013) 222 Cal.App.4th 166, 172; Fowler v. Varian Associates, Inc. (1987) 196 Cal.App.3d 34, 44.) 

Plaintiff alleges Defendant failed to notify her of mold issues and “failed to take reasonable measures” to eliminate the mold.  (Compl. ¶72.)  But Plaintiff’s own allegations show that Defendant responded to her requests to repair the mold issues by having the property inspected for mold, replacing the moldy kitchen cabinet, moving her to a different unit while the repair was being done, obtaining a second report showing the unit was safe for Plaintiff to move back in, and replacing the filters.  As a matter of law, this conduct is not so extreme or outrageous as to be beyond the pale of decency.  (Rivera v. Johnson, 2022 Cal. Super. LEXIS 7718 at *2 (finding no extreme and outrageous conduct where landlord was alleged to have failed to make repairs or do adequate maintenance; “These factual allegations constitute an ordinary landlord-tenant dispute, not extreme and outrageous conduct beyond the bounds of human decency.”); Gruver v. Ih2 Prop. W., 2021 Cal. Super. LEXIS 105245 at *5 (finding no extreme and outrageous conduct where complaint contains numerous allegations of landlord’s attempts to correct complaints raised by tenants); Mason v. Lund, 2022 Cal. Super. LEXIS 58761 at *10 (finding no extreme and outrageous conduct where Plaintiffs allege Landlord failed to address a growing mold problem for over four and a half years).   

This case is unlike cases where courts have found extreme and outrageous conduct in the context of a landlord-tenant dispute.  Stoiber v. Honeychuck (1980) 101 Cal.App.3d 903 presents the classic case.  There, the plaintiff-tenant alleged that her landlords knew of and failed to repair multiple defective conditions in the plaintiff’s apartment, including leaking sewage from the bathroom plumbing, defective and dangerous electrical wiring, structural weaknesses in the walls, deteriorated flooring, falling ceiling, leaking roof, dilapidated doors, and broken windows.  (Id. at 912.)  Defendants were also cited by the health department for heavy cockroach infestation, broken interior walls, broken deteriorated flooring on front porch, falling ceiling, deteriorated and defective electrical wiring, lack of proper plumbing connection to sewage system in bathroom, sewage under bathroom floor, leaking roof, broken windows, and fire hazard.  (Id.) The trial court sustained the various defendants’ demurrers and granted motions for judgment on the pleadings on the basis that the cause of action for breach of the warranty of habitability was the exclusive remedy available to the plaintiff.  (Id. at 911.)  The court of appeal overruled the trial court, holding that a tenant may seek legal redress for breach of implied warranty of habitability and intentional infliction of emotional distress if the landlord’s acts are extreme and outrageous and result in severe mental distress. (Id. at 922.)  The court of appeal further found that, based on the facts alleged in the plaintiff's complaint, the issue of whether the landlords’ conduct was sufficiently extreme and outrageous was a factual issue that could not be determined on a demurrer or motion for judgment on the pleadings. (Id.)  This case does not come close to the allegations in Stoiber.   

Based on the foregoing, the Court sustains the demurrer with leave to amend as to Plaintiff’s intentional infliction of emotional distress claim.   

Breach of Contract 

Defendant argues that where a breach of contract claim is predicated on a written contract, the terms of the contract must be stated verbatim in the complaint or, in the alternative, the contract must be attached to and incorporated in the complaint.  Defendant draws its argument from Otworth v. Southern Pac. Transportation Co. (1985) 166 Cal.App.3d 452, which does indeed state, “If the action is based on an alleged breach of a written contract, the terms must be set out verbatim in the body of the complaint or a copy of the written instrument must be attached and incorporated by reference.” (Id. at 459 (citing Wise v. Southern Pacific Co. (1963) 223 Cal.App.2d 50, 59).)   

However, this opinion has been criticized in Miles v. Deutsche Bank National Trust Co. (2015) 236 Cal.App.4th 394, 401.  Miles noted that the Otworth court did not offer any analysis to support its proposition.  Instead, it simply cited Wise v. Southern Pacific Co. (1963) 223 Cal.App.2d 50, 59, 35 Cal.Rptr.652 (overruled on other grounds in Applied Equipment Corporation v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510, 521).  The Wise court stated, “where a written instrument is the foundation of a cause of action, it may be pleaded in haec verba by attaching a copy as an exhibit and incorporating it by proper reference.” (Id. at 402.)  “It is readily apparent that the Otworth court read more into that statement than is actually there. The Wise court was simply stating one available method of pleading the contract --- it was not specifying the exclusive means of pleading a contract.” (Id.)  More importantly, Miles concluded that even if Otworth’s statement of the law was correct, it was effectively overruled by the California Supreme Court’s holding, in 2002, that “a plaintiff may plead the legal effect of the contract rather than its precise language.” (Id. at 402  (quoting Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 199).) 

Plaintiff has pled the legal effect of the contract by alleging “Plaintiff entered into the Lease with Defendant whereby she obtained possession and enjoyment of the Property as a tenant.  The purpose of the Lease was for Plaintiff to obtain a habitable residence from Defendant in return for payment of a monthly sum.  Therefore, the contract presupposed that Defendant and its servicing agents and employees would put the Property in condition suitable for a habitable residence.”  (Compl. ¶¶ 79-80.) 

Defendant next argues that the breach of contract claim is duplicative of Plaintiff’s first and second causes of action for breach of habitability.  They all allege a breach of warranty that the premises are and will be maintained in a habitable condition.  However, Plaintiff is allowed to allege different causes of action based on essentially the same facts that state a separate theory.  (Nava v. Inglewood Props. II LLC, 2021 Cal. Super. LEXIS 94401 at *11 (overruling demurrer on ground breach of habitability claim is duplicative of breach of contract claim); Alexander v. City of Inglewood, 2022 Cal. Super. LEXIS 40708 at *14 (overruling demurrer that claim for breach of statutory warranty of habitability was duplicative of breach of contract claim).) 

Accordingly, the Court overrules Defendant’s demurrer to Plaintiff’s fourth cause of action for breach of contract.     

Breach of Covenant of Quiet Possession 

The elements of a claim for breach of the covenant of quiet enjoyment are (1) a lease agreement between plaintiff and defendant, (2) absence of language contrary to the implied covenant that tenant shall have quiet enjoyment and possession, (3) act or omission of the landlord which “substantially interfere[s] with a tenant[‘]s right to use and enjoy the premises for the purposes contemplated by the tenancy”; and (4) an applicable remedy.  (Andrews v. Mobile Aire Estates (2005) 25 Cal.App.4th 578, 588-591.)   

Minor inconveniences and annoyances are not actionable breaches.  (Id. at 589.)  To be actionable as a breach of the covenant of quiet possession or quiet enjoyment, a landlord's act or omission must substantially interfere with a tenant’s right to use and enjoy the premises.  (Id.)  This is an outgrowth of the original rule, under California law, that the covenant of “quiet possession” is not breached until there is an actual or constructive eviction.  See Standard Live Stock Co. v. Pentz (1928) 204 Cal. 618, 625 (“The law is too well settled to require extensive comment or citation of authority that the covenant of quiet possession in a lease is not breached until there has been an actual or constructive eviction.”); see also Friedman & Garcia (2005) § 4:21, at 4-9; 7 Miller & Starr, California Real Estate (3d ed.) § 19:156; id. § 19:159.  This rule has now been expanded so that a tenant may sue under this covenant even while remaining in possession of the property.  (Nativi v. Deutsche Bank Nat’l Trust Co., 223 Cal.App.4th 261, 292 (citing Guntert v. City of Stockton (1976) 55 Cal.App.3d 131, 141).) 

Here, Plaintiff has alleged substantial interference.  A professional mold test showed there were elevated levels of mold present in her kitchen, living room and bedroom.  The report concluded these areas were uninhabitable until proper remedial measures were taken.  (Compl. ¶21.)   

Defendant argues that “so long as the landlord acts reasonably in fulfilling the statutory duty to make repairs (Cal. Civ. Code § 1941), the interference with a tenant’s use of the premises in order to make repairs does not breach the covenant.”  But the interference here goes beyond inconvenience to Plaintiff for the period Defendant was repairing the kitchen cabinet.  Rather, the interference remains to this day because major portions of Plaintiff’s apartment, including her kitchen, living room and bedroom, are uninhabitable.   

Accordingly, the Court overrules Defendant’s demurrer to Plaintiff’s seventh cause of action for breach of quiet enjoyment.    

Fraud/Intentional Misrepresentation 

The elements of fraud are (1) a misrepresentation, (2) scienter or knowledge of falsity, (3) intent to induce reliance, (4) justifiable reliance, and (5) resulting damage.  (Hinesley v. Oakshade Town Ctr. (2005) 135 Cal.App.4th 289, 294.)  The facts constituting the alleged fraud must be alleged specifically as to every element of fraud in order to give defendant notice.  (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)  Further, to properly allege fraud against a corporation, the plaintiffs must plead the names of the person allegedly making the false representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.  (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 157.)    

Plaintiff alleges Defendant (1) concealed from Plaintiff that the Property contained dangerous levels of toxic mold and denied the presence of toxic mold, (2) made repeated and constant misrepresentations concerning the source of the mold and toxic contamination and the effects of the same to Plaintiff’s physical health, (3) intentionally misrepresented that Defendant would promptly and properly remediate the toxic mold contamination, and (4) concealed the fact that Defendant did not even test for mold (only testing for moisture).  None of these allegations identify the names of the person who allegedly made the false representations, their authority to speak, what they specifically said or wrote, and when it was said or written.     

Accordingly, the Court sustains the demurrer to Plaintiff’s cause of action for fraud with leave to amend.   

Breach of the Implied Covenant of Good Faith and Fair Dealing 

“[T]he law implies in every contract a covenant of good faith and fair dealing.  Broadly stated, that covenant requires that neither party do anything which will deprive the other of the benefits of the agreement.” (Seaman's Direct Buying Service, Inc. v. Standard Oil Co. (1984) 36 Cal.3d 752, 768; see also Rest.2d Contracts, § 205, p. 99.)  

“A breach of the implied covenant of good faith and fair dealing involves something beyond breach of the contractual duty itself and it has been held that bad faith implies unfair dealing rather than mistaken judgment.”  (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1394.)  “If the allegations do not go beyond the statement of a mere contract breach and, relying on the same alleged acts, simply seek the same damages or other relief already claimed in a companion contract cause of action, they may be disregarded as superfluous as no additional claim is actually stated … [T]he only justification for asserting a separate cause of action for breach of the implied covenant is to obtain a tort recovery.”  (Id. at 1394-1395.)   

To recover in tort for breach of the implied covenant, the defendant must “have acted unreasonably or without proper cause.”  (Id. at 1395.)  “Allegations which assert such a claim must show that the conduct of the defendant, whether or not it also constitutes a breach of a consensual contract term, demonstrates a failure or refusal to discharge contractual responsibilities, prompted not by an honest mistake, bad judgment or negligence but rather by a conscious and deliberate act, which unfairly frustrates the agreed common purposes and disappoints the reasonable expectations of the other party thereby depriving that party of the benefits of the agreement.”  (Id.) 

Plaintiff fails to allege that Defendant’s actions were the result of a conscious and deliberate act as opposed to bad judgment or negligence.  The allegations in the Complaint indicate that Defendant attempted to repair the toxic mold contamination, although they were apparently unsuccessful in doing so.  The fact they failed to remediate the problem was not the result of a conscious and deliberate act but at most, was the product of negligence.   

Plaintiff’s breach of implied covenant of good faith and fair dealing claim is also duplicative of her contract claim.  The claims contain virtually identical allegations; in both, Defendant is alleged to have breached by failing to provide habitable premises to Plaintiff.  (Compare Compl. ¶82 with Compl. ¶110).  A duplicative cause of action which adds nothing to the complaint by way of fact or theory is subject to demurrer.  (Award Metals Inc. v. Superior Court (1991) 228 Cal.App.3d 1128; see also Couch v. San Juan Unified School Dist. (1995) 33 Cal.App.4th 1491, 1504 (“When claims for invasion of privacy and emotional distress are based on the same factual allegations as those of a simultaneous libel claim, they are superfluous and must be dismissed.”); Rodrigues v. Campbell Industries (1978) 87 Cal.App.3d 494, 501 (sustaining demurrer to cause of action which contains all allegations of preceding four causes and action and thus “adds nothing to the complaint by way of fact or theory of recovery”).)   

Punitive Damages 

Defendant moves to strike Plaintiff’s claim for punitive damages.  Defendant argues Plaintiff has only made conclusory allegations that she is entitled to punitive damages without stating facts supporting a finding of malice, oppression or fraud.  The Court agrees.    

A motion to strike is the proper procedure to challenge a claim for punitive damages.   

(Weil & Brown, Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2008) 7:185, p: 7(l)-69; Caliber Bodyworks. Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 385 overruled on other grounds by ZB, N.A. v. Superior Court (2019) 8 Cal. 5th 175, 195.) “In order to survive a motion to strike an allegation of punitive damages, the ultimate facts showing an entitlement to such relief must be pled by a plaintiff.”  (Clauson v. Superior Court (1998) 67 Cal.App.4th 1253, 1255.)  “The mere allegation an intentional tort was committed is not sufficient to warrant an award of punitive damages.  Not only must there be circumstances of oppression, fraud or malice, but facts must be alleged in the pleading to support such a claim.”  (Grieves v. Superior Court (1984) 157 Cal.App.3d 159, 166 (citations omitted).)  Allegations that merely plead the statutory phraseology are wholly insufficient to state a basis for recovery of punitive damages.  (Smith v. Superior Court (1992) 10 Cal.App.4th 1033, 1041.)  Conclusory characterizations of defendant’s conduct as willful, intentional or fraudulent is a patently insufficient statement of the necessary factual grounds for punitive damages.  (Brousseau v. Jarrett (1977) 73 Cal.App.3d 864, 872.)     

To establish “malice”, a plaintiff must demonstrate that (1) the defendant intended to cause injury to plaintiff or (2) despicable conduct with a willful and conscious disregard of the rights or safety of others.  (Civ. Code §3294(c)(1).).  “[A]bsent an intent to injure the plaintiff, malice requires more than a willful and conscious disregard of the plaintiffs’ interest.  The additional component of ‘despicable conduct’ must be found.”  (College Hosp. Inc. v. Superior Court (1994) 8 Cal.4th 704, 725.)  To establish “oppression,” Plaintiff must allege “despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.”  (Id.)  To establish “fraud,” Plaintiffs must allege “an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.”  (Id.)   

Malice and oppression both require a finding of despicable conduct.  “Despicable” means conduct that is “so vile, contemptible, miserable, wretched or loathsome that it would be looked down upon and despised by ordinary decent people.”  (Scott v. Phoenix Schools, Inc. (2009) 175 Cal.App.4th 702, 715.)  “Such conduct has been described as having the character of outrage frequently associated with [a] crime.”  (Id.)   

Punitive damages are disfavored by public policy and are allowed only under the most extreme circumstances and in the clearest cases.  (Woolstrum v. Mailloux (1983) 141 Cal.App.3d Supp. 1, 9.)  “To contain the generosity and emotionality of juries, appellate courts have set the threshold high in defining situations in which punitive damages can be given.  Conduct which may be characterized as unreasonable, negligent, grossly negligent or reckless does not satisfy the highly culpable state of mind warranting punitive damages. Conduct which warrants punitive damages must be of "such severity or shocking character [as] warrants the same treatment as accorded to willful misconduct -- conduct in which defendant intends to cause harm."  (Id. at 10 (citations omitted).) 

Here, the factual allegations in the complaint do not sufficiently plead malice, oppression or fraud and at best, can only be characterized as “unreasonable, negligent, grossly negligent or reckless” conduct which does not satisfy the “highly culpable state of mind” warranting punitive damages.  Plaintiff alleges Defendant immediately replaced the washer/dryer and fixed the leaking pipe.  Defendant hired a company to test for mold and repaired the cabinet where mold was found, moving Plaintiff to a separate unit while repairs were being undertaken.  Defendant also replaced all the filters at Plaintiff’s request.  Defendant conducted another mold test which concluded the apartment was safe for Plaintiff to move back into.  These allegations do not support a finding of malice, oppression or fraud.       

McDonnell v. American Trust (1955) 130 Cal.App.2d 296 is instructive.  There, plaintiff tenant sued defendant landlord for injuries sustained when the tenant slipped and fell on water that had entered her store due to defects in the roof and roof drains.  Tenant alleged the landlord knew of the problems with the roof and roof drains and the problems could cause injury to plaintiff’s person or property but did not remedy the conditions.  The tenant sued landlord for punitive damages.  The trial court sustained a demurrer to the complaint without leave to amend and entered judgment for landlord.  The trial court held that the facts did not support a claim for an intentional tort or conduct in reckless disregard of the rights of others as would show the malice in fact which Cal. Civ. Code § 3294 required as a predicate for punitive damages.  The tenant appealed.  The Court of Appeal held that the facts did not support a finding of malice.  “Calling this a ‘willful’ failure to repair was not the same as saying defendant acted with a wrongful personal intent to injure or in reckless disregard of the rights of others.”  (Id. at 300.)  As in McDonnell, here, Defendant’s knowledge of problems with mold contamination and purported failure to properly repair the problem do not rise to the level of malice, oppression or fraud, necessary to state a claim for punitive damages. 

In addition, when seeking punitive damages against a corporation like Defendant, the plaintiff must allege “advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud or malice … on the part of an officer, director or managing agent of the corporation” of the wrongful conduct.”  Civ. Code § 3294.  Plaintiff has not alleged any advance knowledge, authorization or ratification by any officer, director or managing agent of Defendant. 

Plaintiff’s authorities are unavailing.  All but one of them predate the 1980 amendments to Civ. Code § 3294, and all of them predate the 1987 amendments to the statute.   

In 1980, the Legislature added section 3294, subdivision (b), which “limited the circumstances under which an employer could be held liable for punitive damages ‘based upon acts of an employee.’” (College Hospital Inc. v. Superior Court (1994) 8 Cal.4th 704, 712–713, quoting § 3294, subd. (b); see also White v. Ultramar, Inc. (1999) 21 Cal.4th 563, 572  (“The drafters’ goals [in amending section 3294 to add subdivision (b)] were to avoid imposing punitive damages on employers who were merely negligent or reckless and to distinguish ordinary respondeat superior liability from corporate liability for punitive damages”).)  The Legislature also defined the terms “oppression,” “fraud,” and “malice.”  (§ 3294, subd. (c); Butte Fire Cases (2018) 24 Cal. App. 5th 1150, 1160.) 

The Legislature revisited section 3294 in 1987.  (College Hospital, supra, 8 Cal.4th at 713; Stats. 1987, ch. 1498, §§ 1–7, pp. 5777–5782.)  The Legislature increased the plaintiffs' burden of proving punitive damages to “clear and convincing evidence.” (College Hospital, 8 Cal.4th at 713.)  The Legislature also refined the definition of “malice” by adding the terms “despicable” and “willful.” (Stats. 1987, ch. 1498, § 5, p. 5780; Lackner v. North (2006) 135 Cal.App.4th 1188, 1211 (“As amended, malice, based upon a conscious disregard of the plaintiff’s rights, requires proof that the defendant’s conduct is ‘despicable’ and ‘willful’”).)  The statute’s reference to “despicable conduct” represents “a new substantive limitation on punitive damage awards.”  (Lackner 135 Cal.App.4th at 1210-1211.) 

Because Plaintiff’s authorities pre-date significant amendments to § 3294, they are not controlling, and the Court does not consider them.   

Accordingly, the Court grants Defendant’s motion to strike Plaintiff’s punitive damages claim. 

Attorneys’ Fees    

Defendant moves to strike Plaintiff’s request for attorneys’ fees pursuant to Civ. Code § 1942.5.  Section 1942.5 states “In any action brought for damages for retaliatory eviction, the court shall award reasonable attorneys’ fees to the prevailing party if either party requests attorney’s fees upon the initiation of the action.”  Defendant argues Plaintiff has not alleged retaliatory eviction and thus attorneys’ fees under this section are unavailable.   

Plaintiff does not dispute that it is not alleging retaliatory eviction.  Plaintiff argues, however, that it is entitled to attorneys fees under other provisions.  Plaintiff contends Civ. Code § 1942.4 allows attorneys fees to the prevailing party in “circumstances where a dwelling substantially lacks any of the characteristics outlined in Civ. Code §1941.1 or violates the Health and Safety Code or is otherwise deemed substandard pursuant to the Health and Safety Code.”  Plaintiff also claims entitlement to attorneys’ fees under the parties’ contract which states: “In the event of any litigation relating to this Agreement or the rights or liabilities of any party arising under this Agreement, the prevailing party of such litigation shall be entitled to its costs, including reasonable attorneys’ fees, incurred in such litigation, not to exceed a maximum total of two thousand dollars ($2,000) fees and costs.”  (Ex. A ¶57.)  In its reply, Defendant does not address any of these arguments.   

The Court agrees in part with Plaintiff.  The Court concludes § 1942.4 does not allow for fees as two requirements for seeking fees under that section are not met:  No “public officer or employee who is responsible for the enforcement of any housing law, after inspecting the premises, has notified the landlord or the landlord’s agent in writing of his or her obligations to abate the nuisance or repair the substandard conditions,” and there is no showing that the conditions have “not been abated 35 days beyond the date of service of [a] notice” by a public officer or employee.   

However, the parties’ contract does allow for attorneys’ fees.  And the Complaint does allege entitlement to such fees under the contract.  (Compl. ¶ 43 (“Plaintiff will also seek and is entitled to recover attorney’s fees under the attorneys’ fees clause in the Lease.”).) 

Accordingly, the Court will strike the reference to Civ. Code § 1942.5 in the prayer for relief, but will not strike the request for attorneys’ fees.   

CONCLUSION 

Based on the foregoing, the Court SUSTAINS IN PART and OVERRULES IN PART Defendant’s demurrer.  The demurrer is sustained with leave to amend as to the fifth cause of action for intentional infliction of emotional distress, eighth cause of action for fraud/deceit/intentional misrepresentations of fact, and ninth cause of action for breach of the implied covenant of good faith and fair dealing.  The Court also GRANTS IN PART and DENIES IN PART Defendant’s motion to strike.  Specifically, the Court will strike paragraphs 44, 70, 91, 104 paragraph 6 of the prayer for relief, and the clause “pursuant to Code of Civil Procedure § 1942.5” in paragraph 8 of the prayer for relief.      

 

IT IS SO ORDERED. 

 

DATED: March 1, 2023 ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court