Judge: Frank M. Tavelman, Case: 23BBCV00628, Date: 2023-10-20 Tentative Ruling
Case Number: 23BBCV00628 Hearing Date: October 20, 2023 Dept: A
LOS
ANGELES SUPERIOR COURT
NORTH
CENTRAL DISTRICT - BURBANK
DEPARTMENT
A
TENTATIVE
RULING
(Revised)
OCTOBER 20,
2023
DEMURRER
Los Angeles Superior Court
Case # 23BBCV00628
|
MP: |
Vickie Stark, M.D., Alexandar
Astafiev, and Janet Minassian (Plaintiffs) |
|
RP: |
Rediger Investment Corporation
(Defendant) |
NOTICE
The Court is not requesting oral argument on
this matter. Pursuant to California Rules of Court, Rule 3.1308(a)(1)
notice of intent to appear is required. Unless the Court directs argument
in the Tentative Ruling, no argument will be permitted unless a “party notifies
all other parties and the court by 4:00 p.m. on the court day before the
hearing of the party’s intention to appear and argue. “The tentative
ruling will become the ruling of the court if no notice of intent to appear is
received.”
Notice may be given either by email at BurDeptA@LACourt.org
or by telephone at (818) 260-8412.
ALLEGATIONS:
Vickie Stark, M.D. (“Stark”),
Alexandar Astafiev (“Astafiev”), and Janet Minassian (“Minassian”)
(collectively “Plaintiffs”) bring this action against Rediger Investment
Corporation (“Defendant”). Plaintiffs allege Defendant failed to adhere to its
obligations under a lease agreement for a commercial space at 500 Olive Ave,
Ste. #101 and #103, Burbank, CA, 91501 (“Property”). Among other things,
Plaintiffs allege Defendant failed to remediate issues of mold, faulty plumbing,
faulty ventilation, and broken air conditioning. Stark alleges these building
defects interfere with her ability to operate her MRI imaging business at the
Property. Astafiev and Minassian, Stark’s employees, allege they have suffered
negative health effects from working at the Property.
The Complaint contains
causes of action for (1) Breach of Express Contract (as to Stark only), (2)
Breach of Implied Contract (as to Stark only), (3) Breach of the Implied
Covenant of Quiet Enjoyment, (4) Negligence, (5) Unfair Business Practices, (6)
Unjust Enrichment, and (7) Intentional Infliction of Emotional Distress.
Defendant now demurs to
each cause of action, except for the fourth for Negligence. Defendant’s grounds
for demurrer to each cause of action is that the Complaint fails to allege sufficient
facts. Plaintiffs oppose the demurrer.
ANALYSIS:
I.
LEGAL
STANDARD
The grounds for a demurrer must appear on the
face of the pleading or from judicially noticeable matters. (C.C.P. §
430.30(a); Blank v. Kirwan (1985) 39 Cal. 3d 311, 318.) A demurrer for
sufficiency tests whether the complaint states a cause of action. (Hahn v.
Mirda (2007) 147 Cal.App.4th 740, 747.) The only issue involved in a
demurrer hearing is whether the complaint states a cause of action. (Id.)
A demurrer assumes the truth of all factual,
material allegations properly pled in the challenged pleading. (Blank v.
Kirwan, supra, 39 Cal. 3d at 318.) No matter how unlikely or improbable,
the plaintiff’s allegations must be accepted as true for the purpose of ruling
on the demurrer. (Del E. Webb Corp. v. Structural Materials Co. (1981)
123 Cal. App. 3d 593, 604.) But this does not include contentions;
deductions; conclusions of fact or law alleged in the complaint; facts
impossible in law; or allegations contrary to facts of which a court may take
judicial notice. (Blank, supra, 39 Cal. 3d at 318.)
Pursuant to C.C.P. §§ 430.10(e) and (f), the
party against whom a complaint has been filed may demur to the pleading on the
grounds that the pleading does not state facts sufficient to constitute a cause
of action, or that the pleading is uncertain, ambiguous and/or unintelligible.
It is an abuse of discretion to sustain a demurrer without leave to amend if
there is a reasonable probability that the defect can be cured by amendment. (Schifando
v. City of Los Angeles (2003) 31 Cal. 4th 1074, 1082.)
II.
MEET & CONFER
C.C.P. §§ 430.41(a) requires that the moving party meet
and confer with the party who filed the pleading that is subject to the
demurrer. Upon review the Court finds the meet and confer requirements were
met. (Laird Decl.)
III.
MERITS
First Cause of Action –
Breach of Contract – Overruled
To state a cause of action
for breach of contract, Plaintiff must be able to establish “(1) the existence
of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3)
defendant’s breach, and (4) the resulting damages to the plaintiff.” (Oasis West Realty, LLC v. Goldman (2011)
51 Cal.4th 811, 821.)
If a breach of contract
claim “is based on 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 agreement
must be attached and incorporated by reference.” (Harris v. Rudin, Richman & Appel (1999) 74 Cal.App.4th 299,
307.) In some circumstances, a plaintiff may also “plead the legal effect of
the contract rather than its precise language.” (Construction Protective Services, Inc. v. TIG Specialty Ins. Co.
(2002) 29 Cal.4th 189, 198-199.) In order to plead a contract by its legal
effect, plaintiff must allege the substance of its relevant terms. This is more
difficult, for it requires a careful analysis of the instrument,
comprehensiveness in statement, and avoidance of legal conclusions.” (McKell
v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1489 [internal
citations and quotations omitted].)
Defendant demurs to this
cause of action because Stark failed to attach the lease agreement between
them. Defendant argues Stark has not pled the terms of the lease agreement such
that she has pleaded the legal effect of the contract.
Stark’s factual allegations
are as follows:
Stark entered into a lease
agreement, by assignment, with Defendant concerning the Property for 48 months.
(Compl. ¶ 13.) The lease was to last until October of 2024 and rent was set at
$6,965 per month. (Id.) The agreement stated that the parties agreed to
incorporate and keep the original lease agreement and terms would remain
unchanged. (Compl. ¶ 37.) The lease was to be governed by the laws of the
state where the property was located. (Compl. ¶ 38.) Defendant was aware of
Stark’s intent to operate an MRI imaging business and the Property had been
used for such purposes before. (Compl. ¶¶ 39-40.) The lease obligated Defendant
to keep the Property in “good condition and repair”. (Compl. ¶ 41.) The lease
required Defendant to provide maintenance and repairs withing 30 days of a
complaint. (Compl. ¶42.)
The Court finds the
allegations in the Complaint are sufficient to plead the legal effect of the
contract. Stark has sufficiently alleged terms establishing the nature of the
contract and the obligations of the parties under that contract. Failure to
attach a contract or set out verbatim its terms is not fatal to a breach of
contract cause of action. (Miles v. Deutsche Bank National Trust Co.
(2015) 236 Cal.App.4th 394, 402.) Here Stark has alleged the essential terms of
the lease agreement between the parties and the terms which are relevant to her
cause of action for breach of contract.
Defendant argues Stark’s
omission of the contract is an attempt to avoid terms of the contract which are
unfavorable to her. The Court notes that the ruling on a demurrer has no effect
on the admissibility of the lease agreement as evidence. To the extent that
Defendant feels there are terms harmful to Stark’s cause of action, they are
free to present them. However, it cannot be said Stark has not pleaded the
legal effect of the contract so as to survive demurrer. Accordingly, the
demurrer to the first cause of action is OVERRULED.
Second Cause of Action –
Breach of Implied Contract – Sustained with Leave to Amend
“[A]n action based on an
implied-in-fact or quasi-contract cannot lie where there exists between the
parties a valid express contract covering the same subject matter.” (Lance
Camper Mfg. Corp. v. Republic Indem. Co. of Am. (1996) 44 Cal.App.4th 194,
203. See also Falkowski v. Imation Corp. (2005) 132 Cal.App.4th 499,518
[“implied contract cannot override the terms of an express agreement”].)
Here, Stark’s second cause
of action for breach of implied contract is based on the same operative facts
as her first cause of action for breach of express contract. Stark’s primary
allegation is that she informed Defendant of her intent to operate an MRI
imaging business in the space and that Defendant failed to provide a proper
space to conduct this business. (Compl. ¶ 59.) These allegations are
indistinguishable from the allegations that Defendant violated the condition in
the express contract to keep the leased space in “good condition and repair.”
Stark has alleged no facts which set apart her claim for breach of implied
contract from her claim of breach of express contract.
Accordingly, the demurrer
to the second cause of action is SUSTAINED with leave to amend. Leave to amend
is granted only to the extent that Stark may add facts speaking to an implied
contract not encompassed in express contract between the parties.
Third Cause of Action –
Covenant of Quiet Enjoyment –Overruled
Astafiev and Minassian:
Defendant first argues that
Astafiev and Minassian’s claim for breach of the covenant cannot be sustained
because they have no standing. Defendant argues that neither Astafiev nor
Minassian are third-party beneficiaries of the express contract between Stark
and Defendant. Plaintiffs argue that Astafiev or Minassian are indeed third-party
beneficiaries. Plaintiffs cite Schauer v. Mandarin Gems of Cal., Inc.
(2005) 125 Cal.App.4th 949 in stating that only one party needs to intend to
create the contract for the benefit of a third party.
The Court finds the holding
of Schauer to be inapplicable to this situation. For a third-party to
bring a breach of contract action the contract must be made expressly
for the benefit of that third-party. (Civ. Code § 1559.) Here, the facts pled
make clear Stark was not entering the contract for the express benefit of her
employees. Rather, Stark entered into the contract to operate a medical
business for profit and the presence of her employees was merely incidental. As
the court in Schauer made clear, “[P]ersons only incidentally or
remotely benefited by the contract are not entitled to enforce it.” (Schauer
supra, 125 Cal.App.4th at 958.)
Accordingly as to Astafiev
and Minassian, the demurrer is SUSTAINED without leave to amend.
Stark:
Defendant next argues that
Stark cannot state a claim for breach of the implied covenant because she
remains in possession of the premises and is withholding rent. Plaintiffs’
opposition does not address this argument. Regardless, the Court finds
Defendant’s arguments do not speak to the standard of a demurrer. Defendant’s
argument that Stark has not paid rent has nothing to do with the sufficiency of
facts stated in the complaint. It is true that, pursuant to Petroleum
Collections Inc. v. Swords (1975) 48 Cal.App.3d 841, a tenant electing to
remain in possession is obligated to pay rent. However, it does not follow that
the obligation to pay rent precludes Stark from bringing her claim for breach
of the implied covenant of quiet enjoyment. It may be that Stark will be found
liable for the amount of rent withheld, but this determination is irrelevant to
the determination of a demurrer.
Accordingly, the demurrer
to this cause of action as to Stark is OVERRULED.
Fifth Cause of Action –
Unfair Business Practices - Overruled
Defendant argues Stark has
not pled facts speaking to fraud with sufficient particularity to sustain a
claim for UCL violations. Defendant argues that fraud must be pled as to the
specific acts committed and Stark’s complaint contains only conclusory
allegations.
The Court finds the general
fraud pleading standards inapplicable to claims brought under the UCL. “The
term fraudulent as used in section 17200 does not refer to the common law tort
of fraud but only requires a showing members of the public are likely to be
deceived. Unless the challenged conduct targets a particular disadvantaged or
vulnerable group, it is judged by the effect it would have on a reasonable
consumer.” (Puentes v. Wells Fargo Home Mortgage, Inc. (2008) 160
Cal.App.4th 638, 45 [internal quotations and citations omitted].) Here, Stark
has adequately alleged an act by Defendant which deceived her into entering the
lease under the belief the premises was suited for operation of her business.
The Court finds these allegations are sufficient to state Stark’s cause of
action. Accordingly, the demurrer to the fifth cause of action is OVERRULED.
Sixth Cause of Action –
Unjust Enrichment – Sustained with Leave to Amend
The Court notes there is a
split of authority on whether unjust enrichment is a cause of action. “The
phrase ‘Unjust Enrichment’ does not describe a theory of recovery, but an
effect: the result of a failure to make restitution under circumstances where
it is equitable to do so.” (Lauriedale Associates, Ltd. v. Wilson (1992)
7 Cal. App. 4th 1439, 1448.) “Unjust enrichment is ‘a general principle,
underlying various legal doctrines and remedies,’ rather than a remedy itself.”
(Melchior v. New Line Cinema (2003) 106 Cal. App. 4th 779, 793.)
“[A]s a matter of law, a
quasi-contract action for unjust enrichment does not lie where, as here,
express binding agreements exist and define the parties’ rights.” (California
Medical Ass’n, Inc. v. Aetna U.S. Healthcare of California, Inc. (2001) 94
Cal.App.4th 151, 172; see also Wal-Noon Corp. v. Hill (1975) 45
Cal.App.3d 605, 650) Here, Stark has pled no facts which differentiate her
cause of action for breach of express contract and her cause of action for
unjust enrichment. Accordingly, the demurrer to the sixth cause of action is
SUSTAINED with leave to amend. Leave to
amend is granted only in so far as Stark may add facts separate of the lease
agreement which constitute unjust enrichment.
Seventh Cause of Action –
Intentional Infliction of Emotional Distress – Sustained with Leave to Amend
The elements of a prima
facie case for the tort of intentional infliction of emotional distress (“IIED”)
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. Conduct to be outrageous must be so extreme as
to exceed all bounds of that usually tolerated in a civilized community.” (Wilson v. Hynek (2012) 207 Cal.App.4th
999, 1009, [citation and ellipses omitted].)
Defendant argues Plaintiffs
have not alleged behavior which can be classified as “extreme and outrageous”.
Defendant argues the allegation that they intentionally did not perform their
maintenance obligations is not extreme and outrageous conduct.
Courts have held that
failure to remediate degrading building conditions can serve as a basis for a
claim of IIED. In Burnett v. Chimney Sweep (2004) 123 Cal.App.4th
1057, plaintiffs repeatedly complained of a mold issue and defendant landlord
refused to remediate. The trial court in Burnett granted defendant’s
motion for judgment on the pleadings without leave to amend. The Court of
Appeals reversed the judgment, holding that whether the landlord’s refusal to
rectify the mold issue was extreme and outrageous was a question of fact for
the jury. (Id. at 1069.) The Court of Appeals held that whether the
refusal to act was extreme and outrageous presented a factual question. (Id.,
citing Stoiber v. Honeychuck (1980) 101 Cal.App.3d 903.)
Here, Plaintiffs allege
that Stark notified Defendant of the issues with the property via email, text
message, and verbal complaint. (Compl. ¶ 19.) Plaintiffs allege Defendant
failed to respond to the complaints “at all, or in a timely manner”. (Compl. ¶
20.) The allegations in Plaintiffs’ Complaint are dissimilar to those in Burnett
which supported an IIED cause of action. The plaintiffs in Burnett specifically
alleged the landlord was notified and explicitly refused to remediate the
issue. Conversely, Plaintiffs’ allegations regarding failure to remediate are
conclusory in nature. Plaintiffs’ allegations imply that on some occasions the
requests were ignored and on other occasions they were not, albeit Defendant’s
response was untimely. As such,
Plaintiff has not stated facts sufficient to establish the element of extreme
or outrageous behavior required to sustain the IIED cause of action.
Accordingly, the demurrer to the seventh cause of action is SUSTAINED with
leave to amend.
---
RULING:
In the event the parties
submit on this tentative ruling, or a party requests a signed order or the
court in its discretion elects to sign a formal order, the following form will
be either electronically signed or signed in hard copy and entered into the
court’s records.
ORDER
Rediger Investment
Corporation’s Demurrer came on regularly for hearing
on October 20, 2023, with appearances/submissions as noted in the minute order
for said hearing, and the court, being fully advised in the premises, did then
and there rule as follows:
THE
DEMURRER TO THE FIRST AND THIRD CAUSES OF ACTION ARE OVERRULED.
THE
DEMURRER TO THE FIRST AND FIFTH CAUSES OF ACTION ARE OVERRULED.
THE
DEMURRER TO THE SECOND, SIXTH AND SEVENTH CAUSES OF ACTION ARE SUSTAINED WITH
20 DAYS’ LEAVE TO AMEND.
THE
DEMURRER TO THE THIRD CAUSE OF ACTION IS SUSTAINED WITHOUT LEAVE TO AMEND AS TO
PLAINTIFFS ASTAFIEV AND MINASSIAN, AND OVERRULED AS TO PLAINTIFF STARK.
DEFENDANT
TO GIVE NOTICE UNLESS ALL PARTIES WAIVED NOTICE.
IT IS SO
ORDERED.
DATE:
October 20, 2023 _______________________________
F.M.
TAVELMAN, Judge
Superior Court of California
County of
Los Angeles