Judge Elaine Lu, Case 21STCV42612 2022-12-06 Tentative Ruling

On November 18, 2021, Plaintiff the Law Office of Shaun Setareh (“Plaintiff”) filed the instant nuisance action against Defendants De Pacific 9665, LLC (“DE Pacific”), Douglas Emmett, Inc. (“DEI”), and Douglas Emmett Builders (“DEB”) (collectively “Defendants”). On August 30, 2022, Plaintiff filed the operative FAC against Defendants. The FAC asserts four causes of action for (1) Breach of Contract against DE Pacific, (2) Negligence against Defendants, (3) Promissory Fraud, and (4) Private Nuisance.

On October 11, 2022, Defendants filed the instant demurrer and motion to strike portions of the FAC. On November 22, 2022, Plaintiff filed an opposition. On November 29, 2022, Defendants filed a reply.

On September 15, 2020, Plaintiff entered into a written lease agreement with Defendant DE Pacific. (FAC ¶ BC-1.) From October 15, 2020 onward, Defendant DE Pacific “failed to comply with the terms of the lease agreement. DE PACIFIC breached the warranty of quiet use and enjoyment of the property by scheduling, allowing, and/or failing to prevent upon notice, substantial interference of use from banging, drilling, yelling, and other activities which interfered with Plaintiff's ability to use the property as a ‘first-class office building’. Plaintiff has notified Defendant multiple times of the interference and the harm that Plaintiff was experiencing as a result. However, DE PACIFIC did not act to remedy the situation. Based on the same facts, DE PACIFIC 9665 further breached the implied covenant of good faith and fair dealing. DE PACIFIC 9665 further failed to ‘furnish a reasonable level’ of heating, ventilation and air conditioning to the property as provided in their lease agreement. Plaintiff has reported to Defendant that the temperature in the Premises is either too cold or too hot on multiple occasions, yet these problems keep re-occurring.” (FAC ¶ BC-2.)

“Defendants owed a duty of reasonable care to Plaintiff to prevent harm. Defendants breached that duty by constantly made [sic] excessively loud and severe noises which included but was not limited to banging, drilling, yelling, and playing loud music. Plaintiff complained numerous times to Defendants times to Defendants regarding the noise. Plaintiff believes that many if not all of the activities causing the severe and excessive noise could have been done either off site or outside of regular working hours, which could have potentially remedied the breach. Instead, the excessively loud noises continued for months. The noise was so excessive, persons speaking with Plaintiff’s employees over telephone, video conference, or other means were able to hear the noise extremely loudly and requested or demanded that Plaintiff’s employees either stop the noise or go somewhere quitter [sic]. The excessive noise cause Plaintiff damages, which Plaintiff now seeks in this action for back pay of rent, lost revenue, loss productivity, and lost business opportunities. For the reasons above, Plaintiff alleges that Defendants acted with negligence and/or gross negligence.” (FAC ¶ GN-1.)

From October 15, 2020 to the present, “Defendants promised to maintain the leased property free from interference with quiet enjoyment and use, Defendants further promised to provide a reasonable level of heating, ventilation, and air conditioning to the property.” (FAC ¶ FR-4.) In reliance upon this promise Plaintiff was induced into entering into the lease agreement with Defendant DE Pacific. (FAC ¶ FR-5.)

“Plaintiff is leasing the property at 9665 Wilshire Blvd., Suite 430, Beverly Hills, CA, 90212.” (FAC ¶ N-1.) “After Plaintiff moved-in to the above address, Plaintiff started hearing excessively loud noises caused by Defendants during regular work hours. Plaintiff is unsure which entity is responsible for the noise, but believes on information and belief that at least one of the Defendants is responsible for the noise. The noise was so excessive and severe that it disturbed Plaintiff’s employees and prevented from working productively.” (FAC ¶ N-2.) “Plaintiff complained numerous times to Defendants regarding the noise.” (FAC ¶ N-3.) “Plaintiff was not able to effectively conduct its business due to the excessively loud and severe noise.” (FAC ¶ N-4.) “Even persons speaking with Plaintiff’s employees over telephone, video conference, or other means were able to hear the noise extremely loudly and requested or demanded that Plaintiff’s employees either stop the noise or go somewhere quieter. These persons included Plaintiff’s clients, other attorneys, and judges. Plaintiff not only suffered a loss of productivity and business, but a loss of reputation in front of the court.” (FAC ¶ N-5.) “For the reasons above, the excessive and severe noise substantially interfered with Plaintiff’s ability to use the property.” (FAC ¶ N-6.) “Plaintiff believes that many if not all of the activities causing the severe and excessive noise could have been done either offsite or outside of regular working hours.” (FAC ¶ N-7.)

As the Court may take judicial notice of court records and actions of the State, (See Evid. Code, § 452(c),(d)), Defendants’ unopposed request for judicial notice is granted. However, the Court does not take judicial notice of the truth of hearsay assertions within these judicially noticed court records. (See Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375.)

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. (Blank v. Kirwan (1985) 39 Cal 3d 311, 318.) No other extrinsic evidence can be considered (i.e., no “speaking demurrers”). (Ion Equipment Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881.)

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 “give the complaint a reasonable interpretation, and read it in context.” (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.) 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.” (SKF Farms v. Superior Ct. (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, supra, 147 Cal.App.4th at 747.)

Motions to strike are used to reach defects or objections to pleadings that are not challengeable by demurrer (i.e., words, phrases, prayer for damages, etc.). (See CCP §§ 435-437.) A party may file a motion to strike in whole or in part within the time allowed to respond to a pleading. However, if a party serves and files a motion to strike without demurring to the complaint, the time to answer is extended. (CCP §§ 435(b)(1), 435(c).)

A motion to strike lies only where the pleading has irrelevant, false, or improper matter, or has not been drawn or filed in conformity with laws. (CCP § 436.) The grounds for moving to strike must appear on the face of the pleadings or by way of judicial notice. (CCP § 437.)

Code of Civil Procedure § 430.41, subdivision (a) requires that “[b]efore filing a demurrer pursuant to this chapter, the demurring party 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.” The parties are to meet and confer at least five days before the date the responsive pleading is due and if they are unable to meet the demurring party shall be granted an automatic 30-day extension. (CCP § 430.41(a)(2).) The demurring party must also file and serve a declaration detailing the meet and confer efforts. (Id.¿at (a)(3).)¿ If an amended pleading is filed, the parties must meet and confer again before a demurrer may be filed to the amended pleading. (Id.¿at (a).) There is a similar meet and confer requirement for motions to strike. (CCP § 435.5.)

Here, Defendant has fulfilled the meet and confer requirements. (Meyer Decl. ¶ 3.)

Defendants demurrer to the second and third causes of action asserted against them.

Defendants contend that the second cause of action for negligence (1) is barred by the economic loss rule and (2) fails to sufficiently allege duty or causation.

The economic loss rule provides that “[i]n general, there is no recovery in tort for negligently inflicted ‘purely economic losses,’ meaning financial harm unaccompanied by physical or property damage.” (Sheen v. Wells Fargo Bank, N.A. (2022) 12 Cal.5th 905, 922.) “[T]he rule functions to bar claims in negligence for pure economic losses in deference to a contract between litigating parties.” (Ibid.) However, “[n]ot all tort claims for monetary losses between contractual parties are barred by the economic loss rule. But such claims are barred when they arise from — or are not independent of — the parties’ underlying contracts.” (Id. at p.923.)

Here, the claim for negligence is independent of the contractual claim between Plaintiff and Defendant DE Pacific. The negligence claim alleges in relevant part that:

Defendants owed a duty of reasonable care to Plaintiff to prevent harm. Defendants breached that duty by constantly made [sic] excessively loud and severe noises which included but was not limited to banging, drilling, yelling, and playing loud music. Plaintiff complained numerous times to Defendants times to Defendants regarding the noise. Plaintiff believes that many if not all of the activities causing the severe and excessive noise could have been done either off site or outside of regular working hours, which could have potentially remedied the breach. Instead, the excessively loud noises continued for months. The noise was so excessive, persons speaking with Plaintiff’s employees over telephone, video conference, or other means were able to hear the noise extremely loudly and requested or demanded that Plaintiff’s employees either stop the noise or go somewhere quitter [sic]. The excessive noise cause Plaintiff damages, which Plaintiff now seeks in this action for back pay of rent, lost revenue, loss productivity, and lost business opportunities. For the reasons above, Plaintiff alleges that Defendants acted with negligence and/or gross negligence.

The negligence allegations arise from Defendants constantly making excessive and loud noises. In contrast, the claim for breach of contract – which is solely against DE Pacific – is based on the breach of the warranty of quiet use and enjoyment of the property by “failing to prevent upon notice” the noise caused by Defendants. (FAC ¶ BC-2.) In sum, the negligence claim arises from Defendants negligently causing excessive noise whereas the breach of contract claim arises from Defendant DE Pacific breaching the covenant of quiet enjoyment by failing to prevent the noise from occurring. These duties are clearly independent of one another. The duty to prevent noises under the covenant of quiet enjoyment in the lease would arise even if DE Pacific was not causing the noise. In contrast. the negligence cause of action arises out of Defendants’ actions in affirmatively causing the noise -- not a negligent breach to prevent noise, i.e., not a negligent breach of contract. Thus, the economic loss rule is inapplicable to the instant action.

Further, the economic loss rule clearly does not apply to Defendants DEI and DEB for the additional reason that there is no allegation of any contractual relationship between Plaintiff and Defendants DEI or DEB.

“‘The elements of a negligence cause of action are the existence of a legal duty of care, breach of that duty, and proximate cause resulting in injury.’ [Citations.]” (McIntyre v. The Colonies-Pacific, LLC (2014) 228 Cal.App.4th 664, 671.)

“Duty is not universal; not every defendant owes every plaintiff a duty of care. A duty exists only if ‘ “the plaintiff's interests are entitled to legal protection against the defendant's conduct.” ’ [Citations.]” (Brown v. USA Taekwondo (2021) 11 Cal.5th 204, 213.) “Whether a duty exists is a question of law to be resolved by the court.” (Ibid.) “[T]he law imposes a general duty of care on a defendant only when it is the defendant who has ‘ “created a risk” ’ of harm to the plaintiff, including when ‘ “the defendant is responsible for making the plaintiff's position worse.” ’ [Citations.]” (Id. at p.214.) Thus, “[a]s a general principle, a ‘defendant owes a duty of care to all persons who are foreseeably endangered by his conduct, with respect to all risks which make the conduct unreasonably dangerous.’ ” (Tarasoff v. Regents of University of California (1976) 17 Cal.3d 425, 434–435.)

Here, the claim for negligence is that Defendants made excessively loud noise harming Plaintiff. (FAC ¶ GN-1.) A general duty of care arises from Defendants making the noise to the extent that the harm is foreseeable. Contrary to Defendants’ claims, the FAC directly alleges that each of the Defendants caused the noise that harmed Plaintiff. (FAC ¶ GN-1, [“Defendants breached that duty by constantly made [sic] excessively loud and severe noises which included but was not limited to banging, drilling, yelling, and playing loud music.”], [italics added].) With regard to the negligence claim, it is clear that the FAC alleges that all Defendants are making the noise. The cited language upon which Defendant relies -- “Plaintiff is unsure which entity is responsible for the noise, but believes on information and belief that at least one of the Defendants is responsible for the noise…” (FAC ¶ N-2) – pertains to the nuisance cause of action -- not the negligence cause of action.[1] Thus, the FAC sufficiently alleges duty and causation with respect to the negligence cause of action.

Defendants contend that the third cause of action fails because (1) it is barred by the economic loss rule, and (2) Plaintiff has failed to allege fraud with sufficient specificity.

As noted above, “[i]n general, there is no recovery in tort for negligently inflicted ‘purely economic losses,’ meaning financial harm unaccompanied by physical or property damage.” (Sheen, supra, 12 Cal.5th at p.922.) “[T]he rule functions to bar claims in negligence for pure economic losses in deference to a contract between litigating parties.” (Ibid.) However, “[n]ot all tort claims for monetary losses between contractual parties are barred by the economic loss rule. But such claims are barred when they arise from — or are not independent of — the parties’ underlying contracts.” (Id. at p.923.)

As to an independent duty, fraudulent inducement of a contract is one means by which California law recognizes the existence of a duty independent of the duties imposed by the contract. (See Erlich, supra, 21 Cal.4th at pp. 551–552.) Fraud in the inducement occurs where a party’s assent to a contract is obtained through “conscious misrepresentation, or concealment, or non-disclosure of a material fact which induces the innocent party to enter the contract.” (Odorizzi v. Bloomfield School Dist. (1966) 246 Cal.App.2d 123, 128; see also Civ. Code, § 1572.)

Here, the FAC alleges fraud in the inducement. Specifically, that in reliance on Defendants’ promise Plaintiff entered into the lease agreement with DE Pacific. Thus, the economic loss rule is inapplicable to the third cause of action.

“The elements of promissory fraud . . . are: (1) a promise made regarding a material fact without any intention of performing it; (2) the existence of the intent not to perform at the time the promise was made; (3) intent to deceive or induce the promise to enter into a transaction; (4) reasonable reliance by the promisee; (5) nonperformance by the party making the promise; and (6) resulting damage to the promisee.” (Rossberg v. Bank of America, N.A. (2013) 219 Cal.App.4th 1481, 1498.) “As with any other form of fraud, each element of a promissory fraud claim must be alleged with particularity.” (Ibid.) “Fraud allegations ‘involve a serious attack on character’ and therefore are pleaded with specificity. [Citation.] General and conclusory allegations are insufficient. [Citation.] The particularity requirement demands that a plaintiff plead facts which ‘‘‘show how, when, where, to whom, and by what means the representations were tendered.’’’ [Citation.]” (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1469.)

Here, the allegations of fraud are insufficient. There is no indication of how any of the alleged promises were made, when these specific promises were made, when they were made, to whom at Plaintiff these representations were made, or by what means these promises were made. Without such allegations, it is unclear how Plaintiff could have reasonably relied upon the unspecified promises. Moreover, in opposition, Plaintiff does not contend that the allegations are sufficient to allege fraud but rather requests leave to amend.

Accordingly, Defendants’ demurrer to the third cause of action is SUSTAINED for lack of specificity.

Defendants move to strike specific allegations from the FAC regarding noise, loss of business revenue, and the prayer for punitive damages. Specifically, Defendants move to strike portions of paragraphs BC-2, the reference to De Pacific for the negligence cause of action at GN-1, the allegation of loss of profits for the breach of contract claim at BC-4, and the promissory fraud allegation at N-1, N-2.

Defendants contend that the Court should strike the allegations regarding noise and loss of business revenue because the lease limits liability.

Under Civil Code section 1927, “there is an implied covenant on the part of a landlord that a tenant shall have quiet enjoyment and possession of the premises during the continuation of the term.” (Lee v. Placer Title Co. (1994) 28 Cal.App.4th 503, 512.) However, “the covenant of quiet enjoyment can be modified or waived by the tenant in a commercial lease setting.” (Id. at p.513.) These “agreements are valid and binding on the parties to the lease unless they are unenforceable in whole or in part because they are unconscionable or significantly against public policy.” (Ibid., Fn. 7.)

Landlord shall not be liable to any Tenant Party for any damages (including any consequential damages, such as interference with Tenant’s business or any loss of profits), by abatement of Rent (except as expressly provided in this Section 10.4) or otherwise, based on any such Claims. Tenant acknowledges and agrees that: (a) the Premises are part of an office building owned, operated, managed and leased by Landlord and occupied by numerous tenants; (b) Landlord and such tenants are engaged from time to time in a variety of construction projects inside individual premises as well as in Common Areas as part of the normal course of business in the Building; and (c) such construction activities may cause, among other things, noise, vibration, dust, odors, increased foot traffic in the Building and in elevators and corridors, and increased motor vehicle traffic in parking facilities. This Lease shall not be affected, nor shall any liability be imposed on any Landlord Party, by reason of (A) any diminution or shutting off of light, air or view by any structure which is now or may hereafter be erected on the Building, the Real Property or on lands adjacent to the Building, (B) noise, dust or vibration or other ordinary incidents to construction of improvements on the Building, the Real Property or on lands adjacent to the Building, whether or not by Landlord or (C) obstruction or the view or light from any windows of the Premises by reason of any repairs, improvements, maintenance or cleaning in or about the Building.

Plaintiff previously alleged that the noise was caused by construction in the building. (RJN Exh. A.) Thus, the lease provision limiting DE Pacific’s liability for breach of the covenant of quiet enjoyment for noise caused by construction applies absent an allegation that the clause is unconscionable or contrary to law. The FAC makes no such allegation. Accordingly, Defendant DE Pacific’s motion to strike the paragraph BC-2 is granted as to “Defendant DE PACIFIC 9665 (‘DE PACIFIC’) failed to comply with the terms of the lease agreement. DE PACIFIC breached the warranty of quiet use and enjoyment of the property by scheduling, allowing and/or failing to prevent upon notice, substantial interference of use from banging, drilling, yelling, and other activities which interfered with Plaintiff’s ability to use the property as a “first class office building. Plaintiff has notified Defendant multiple times of the interference and the harm that Plaintiff was experiencing as a result. However DE PACIFIC did not act to remedy the situation.” (FAC ¶ BC-2.)

As to lost business revenue, the FAC also alleges that DE Pacific breached the implied covenant of quiet enjoyment because “DE PACIFIC 9665 further failed to ‘furnish a reasonable level’ of heating, ventilation and air conditioning to the property as provided in their lease agreement. Plaintiff has reported to Defendant that the temperature in the Premises is either too cold or too hot on multiple occasions, yet these problems keep re-occurring.” (FAC ¶ BC-2.) However, these damages are similarly limited by the lease. The lease expressly provides “[s]uch right to abatement shall be Tenant's sole and exclusive remedy for any Claims arising from any failure or delay in furnishing any services or utilities as required by this Lease, and Tenant (1) shall not be entitled to claim any … disturbance of Tenant's use and possession based on any such Claims and (2) Landlord shall not be liable to any Tenant Party for any damages (including interference with Tenant's business or any loss of profits), by abatement of Rent or otherwise (except as expressly provided in this Section 7.7), based on any such Claims.” (RJN Exh. A at § 7.7.)

These two cited clauses limit Plaintiff’s remedies for damages due to the alleged noise and heating issues. Absent allegations of these clause being unconscionable or otherwise invalid, the prayer for loss of profits for the breach of contract claim is improper. Accordingly, Defendant DE Pacific’s motion to strike is GRANTED as to BC-4 as to “Due to the interference, Plaintiff has suffered a loss of efficiency to their business activities including but not limited to lost revenue and lost business opportunities. Moreover, Plaintiff suffered a loss of full rental value of premises as negotiated and agreed upon. Finally, Plaintiff seeks rescission of the contract.” (FAC ¶ BC-4.)

Defendants further contend that the above clause in the lease prohibits Plaintiff from making claims against Defendant DE Pacific and its agents DEI and DEB for the noise interference and business loss damages. The Court disagrees.

“To the extent the exemption in paragraph [10.4.2] also purports to shield the lessor and its agents from liability for negligence, the exemption is subject to the public policy disfavoring attempts by contract to limit liability for future torts.” (Frittelli, Inc. v. 350 North Canon Drive, LP (2011) 202 Cal.App.4th 35, 43.) “All contracts which have for their object, directly or indirectly, to exempt anyone from responsibility for his own fraud, or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law.” (Civ. Code, § 1668.) “[T]he statute invalidates contracts that purport to exempt an individual or entity from liability for future intentional wrongs [Citation] and gross negligence [Citation].” (Frittelli, Inc., supra, 202 Cal.App.4th at p.43.)

An exculpatory clause such as section 10.4.2 of the lease at issue, as cited above, is “subject to special scrutiny, insofar as it purports to exempt the lessor from liability for ordinary negligence.” (Id. at p.44) “[T]he law does not look with favor upon attempts to avoid liability or secure exemption for one's own negligence, and such provisions are strictly construed against the person relying upon them. [Citations.]” (Basin Oil Co. of Cal. v. Baash–Ross Tool Co. (1954) 125 Cal.App.2d 578, 594.) “For an agreement to be construed as precluding liability for ‘active’ or ‘affirmative’ negligence, there must be express and unequivocal language in the agreement which precludes such liability. [Citations.] An agreement which seeks to limit generally without mentioning negligence is construed to shield a party only for passive negligence, not for active negligence. [Citations.]” (Salton Bay Marina, Inc. v. Imperial Irrigation Dist. (1985) 172 Cal.App.3d 914, 933.) “Whether an exculpatory clause ‘covers a given case turns primarily on contractual interpretation, and it is the intent of the parties as expressed in the agreement that should control. When the parties knowingly bargain for the protection at issue, the protection should be afforded. This requires an inquiry into the circumstances of the damage or injury and the language of the contract; of necessity, each case will turn on its own facts.’ [Citation.]” (Burnett v. Chimney Sweep (2004) 123 Cal.App.4th 1057, 1066.)

As to the fraud claim, Defendant DE Pacific’s intentional conduct is, as a matter of law, outside any exculpatory clause as asserted in the judicially noticed documents. (Civ. Code, § 1668.) As to the negligence claim, the FAC asserts that Defendants actively caused harmful noise. (FAC ¶ GN-1.) The clause in the lease at issue does not specifically mention negligence, and thus, the exculpatory clause protects against only passive negligence. (Salton Bay Marina, Inc., supra, 172 Cal.App.3d at p.933 [“An agreement which seeks to limit liability generally without specifically mentioning negligence is construed to shield a party only for passive negligence, not for active negligence.”].) Therefore, the exculpatory clauses and limitation of remedies clauses are inapplicable to the non-breach of contract claims.

Defendants' motion to strike the allegations regarding noise and lost business profits is DENIED.

Civil “Code section 3294 provides that punitive damages may be awarded in an action for breach of an obligation not arising from contract, if the plaintiff proves by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice.” (Scott v. Phoenix Schools, Inc. (2009) 175 Cal.App.4th 702, 715.) “The clear and convincing standard ‘‘requires a finding of high probability . . . . ‘‘so clear as to leave no substantial doubt’; ‘sufficiently strong to command the unhesitating assent of every reasonable mind.’’ [Citation.]’ [Citations.]’ [Citation.]” (Id.) “‘Malice’ means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.” (Civ. Code § 3294(c)(1).) “‘Oppression’ means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” (Civ. Code § 3294(c)(2).) “[M]ere negligence, which—even if gross, or reckless—cannot justify punitive damages.” (Krusi v. Bear, Stearns & Co. (1983) 144 Cal.App.3d 664, 679.)

Negligence is insufficient to support the prayer for punitive damages. The sole basis for punitive damages within the FAC is the promissory fraud claim. However, as noted above, the Court has sustained Defendants’ demurrer to the promissory fraud claim. Therefore, there is no basis remaining for punitive or exemplary damages. Accordingly, Defendants’ motion to strike the prayer for punitive damages is GRANTED.

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the plaintiff to show the court that a pleading can be amended successfully. (Goodman v. Kennedy, supra, 18 Cal.3d at p.348; Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.)

As this is the first time that the Court has sustained a demurrer to Plaintiff’s complaint, the Court finds it is proper to allow Plaintiff an opportunity to cure the defects discussed in this order. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349; Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037.)

Based on the foregoing, Defendants De Pacific 9665, LLC, Douglas Emmett, Inc., and Douglas Emmett Builders’ demurrer to the First Amended Complaint is SUSTAINED WITH LEAVE TO AMEND as to the third cause of action and otherwise OVERRULED.

Defendants’ motion to strike is GRANTED IN PART with leave to amend as to the prayer for punitive damages and as to:

“Defendant DE PACIFIC 9665 (‘DE PACIFIC’) failed to comply with the terms of the lease agreement. DE PACIFIC breached the warranty of quiet use and enjoyment of the property by scheduling, allowing and/or failing to prevent upon notice, substantial interference of use from banging, drilling, yelling, and other activities which interfered with Plaintiff’s ability to use the property as a ‘first class office building.’ Plaintiff has notified Defendant multiple times of the interference and the harm that Plaintiff was experiencing as a result. However DE PACIFIC did not act to remedy the situation.”

“Due to the interference, Plaintiff has suffered a loss of efficiency to their business activities including but not limited to lost revenue and lost business opportunities. Moreover, Plaintiff suffered a loss of full rental value of premises as negotiated and agreed upon. Finally, Plaintiff seeks rescission of the contract.”

Plaintiff is to file an amended complaint within twenty (20) days of notice of this order.

[1] The Court notes that in preparing the Second Amended Complaint, Plaintiff should amend this allegation to state what facts support this information and belief. (See Doe v. City of Los Angeles (2007) 42 Cal.4th 531, 550; [A “[p]laintiff may allege on information and belief any matters that are not within his personal knowledge, if he has information leading him to believe that the allegations are true.”], [italics added].)

Superior Court of California

County of Los Angeles

Department 26