Judge Gail Killefer, Case 20STCV26377 2022-10-20 Tentative Ruling

MOTION: Demurrer to the Second Amended Complaint in Intervention; Motion to Strike Portions of the Second Amended Complaint in Intervention

Tentative: Defendant’s demurrer is sustained, without leave to amend. Having sustained the demurrer, Defendant’s motion to strike is moot. Defendant is to give notice.

This action arises in connection with real property located at 6031 Lindley Avenue, Unit 26, Tarzana, California (the “Property”). Ilana Zelener (“Plaintiff”) alleges that she owns a fifty (50) percent share of the Property and Daniel M. Parzivand (“Defendant”) owns the other 50 percent. Plaintiff requests partition of the Property through the Complaint. Additionally, the Complaint alleges that Defendant owed a fiduciary duty to Plaintiff based on the parties agreement that Defendant would manage the Property. According to the Complaint, Defendant failed to do so by “engaging in acts and omissions to Plaintiff’s detriment.”

Plaintiff’s Complaint, filed on July 14, 2020, alleges three causes of action as follows: (1) partition, (2) accounting, (3) breach of fiduciary duty.

Defendant’s Cross-Complaint, filed on August 31, 2020, alleges four causes of action as follows: (1) partition, (2) accounting, (3) breach of fiduciary duty, and (4) equitable lien.

On March 26, 2021, the court granted Jacqueline Zelener FKA Jacqueline Parzivand (“Ms. Parzivand” or “Intervenor”)’s motion for leave to intervene in this action. Ms. Parzivand filed a Complaint in Intervention (“CI”) on April 1, 2021, for the sole cause of action for declaratory relief.

On May 3, 2022, the court granted Intervenor’s motion for leave to file a First Amended Complaint in Intervention (“FACI”). Intervenor filed her FACI on May 3, 2022, alleging causes of action for: (1) declaratory relief; (2) breach of contract; (3) unjust enrichment; and (4) fraudulent inducement.

On July 11, 2022, the court sustained Defendant’s demurrer to the FACI in its entirety and granted Intervenor leave to amend.

On August 9, 2022, Intervenor filed the operative Second Amended Complaint in Intervention (“SACI”), alleging causes of action for: (1) declaratory relief; (2) breach of contract; and (3) fraudulent inducement.

Defendant now again demurs to the entire SACI, and moves to strike portions of the SACI. Intervenor opposes both motions.

Intervenor requests judicial notice of the following in support of their opposition:

1. Intervenor’s opposition to Defendant’s demurrer and motion to strike the FACI, filed in this matter. (Exhibit A)

Defendant objects to the judicial notice of Exhibit A, to the extent it asks this court to take judicial notice of the arguments of counsel in a pleading filed in the present action, citing Hebberd-Kulow Enterprises, Inc. v. Kelomar, Inc. (2013) 218 Cal.App.4th 272, 283. The Hebberd-Kulow court specifically found, “[a]n attorney's argument in pleadings is not evidence.” (Id.) As such, the court sustains Defendant’s objection and does not grant judicial notice of Exhibit A.

Defendant requests judicial notice of the following in support of their demurrer and reply:

1. The First Amended Complaint In Intervention filed by Jacqueline Parzivand (nee Zelener) in the present action. (Exhibit 1).

2. The Notice of Ruling sustaining Parzivand’s demurrer to Jacqueline’s First Amended Complaint in Intervention filed on July 11, 2022 in the present action. (Exhibit 2.)

3. The Defendant’s Interlocutory Judgment Of Partition entered on May 3, 2022 in the present action. (Exhibit 3.)

4. Intervenor’s Further Responses To Daniel M. Parzivand’s Requests For Admissions, Set Two served by Jacqueline Parzivand in the present action on July 20, 2022. (Exhibit 4.)

5. Intervenor’s Further Responses To Daniel M. Parzivand’s Form Interrogatories, Set Two served by Jacqueline Parzivand in the present action on July 20, 2022. (Exhibit 5.)

6. The Complaint in Intervention filed by Intervenor in the present action. (Exhibit 6.)

7. Intervenor’s Responses To Daniel M. Parzivand’s [sic] Form Interrogatories, Set One served by Jacqueline Parzivand in the present action on January 20, 2022. (Exhibit 7.)

Defendant’s request is granted. The existence and legal significance of these documents are proper matters for judicial notice. (Evid. Code § 452(d), (h)).

A demurrer is an objection to a pleading, the grounds for which are apparent from either the face of the complaint or a matter of which the court may take judicial notice. (CCP § 430.30(a); see also Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) The purpose of a demurrer is to challenge the sufficiency of a pleading “by raising questions of law.” (Postley v. Harvey (1984) 153 Cal.App.3d 280, 286.) The court “treat[s] the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. . . .” (Berkley v. Dowds (2007) 152 Cal.App.4th 518, 525.) “In the construction of a pleading, for the purpose of determining its effect, its allegations must be liberally construed, with a view to substantial justice between the parties.” (CCP § 452; see also Stevens v. Sup. Ct. (1999) 75 Cal.App.4th 594, 601.) “When a court evaluates a complaint, the plaintiff is entitled to reasonable inferences from the facts pled.” (Duval v. Board of Trustees (2001) 93 Cal.App.4th 902, 906.)

The general rule is that the plaintiff need only allege ultimate facts, not evidentiary facts. (Doe v. City of Los Angeles (2007) 42 Cal.4th 531, 550.) “All that is required of a plaintiff, as a matter of pleading, even as against a special demurrer, is that his complaint set forth the essential facts of the case with reasonable precision and with sufficient particularity to acquaint the defendant with the nature, source and extent of his cause of action.” (Rannard v. Lockheed Aircraft Corp. (1945) 26 Cal.2d 149, 156-157.) “[D]emurrers for uncertainty are disfavored and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.” (Mahan v. Charles W. Chan Ins. Agency, Inc. (2017) 14 Cal.App.5th 841, 848, fn. 3, citing Lickiss v. Fin. Indus. Regulatory Auth. (2012) 208 Cal.App.4th 1125, 1135.) In addition, even where a complaint is in some respects uncertain, courts strictly construe a demurrer for uncertainty “because ambiguities can be clarified under modern discovery procedures.” (Khoury v. Maly’s of California, Inc. (1993) 14 Cal.App.4th 612, 616.)

Demurrers do not lie as to only parts of causes of action where some valid claim is alleged but “must dispose of an entire cause of action to be sustained.” (Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119.) “Generally it is an abuse of discretion to sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment.” (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.)

“Under the sham pleading doctrine, plaintiffs are precluded from amending complaints to omit harmful allegations, without explanation, from previous complaints to avoid attacks raised in demurrers or motions for summary judgment.” (Deveny v. Entropin, Inc. (2006) 139 Cal.App.4th 408, 425.) If there is an inconsistency between the original and amended complaint, the pleader is required to “explain satisfactorily” any inconsistency or omission. (Id. at 426.)

Here, Defendant first contends the SACI involves sham pleadings as it “omits several allegations from the [FACI] in order to insulate it against the issues raised in [Defendant’s] prior demurrer.” (Demurrer, 3.) Defendant contends these omissions include: details of the three-party $150,000 loan from lender Oransky; that Intervenor was induced into taking out the loan to purchase the Property; that the Property was purchased for Intervenor’s benefit; that Intervenor conditioned her marriage to Defendant on living in the Los Angeles Area, and Defendant could not afford such living circumstances without the loan. (Demurrer, 3.)

In opposition, Intervenor contends “[Intervenor] is not trying to avoid any allegations and to the extent there are any omissions, they are merely syntax and are not, in any way, determinative of a single cause of action alleged in the SACI.” (Opposition, 4.) Intervenor contends the terms of the Oranksy loan are not omitted, and,

“[a]ll iterations of the Complaint in Intervention have always focused on [Intervenor’s] allegations to enforce the terms of her agreement with [Defendant] concerning the funds borrowed from Mr. Oransky, not against Mr. Oransky himself. ... The Complaint, FACI, and SACI allege that the money came from Mr. Oransky, how [Intervenor] and [Defendant] agreed to repay Mr. Oransky, and addresses exactly what the Court found at issue in its prior ruling; alleging clear and sufficient facts to establish the terms of the agreement between [Intervenor] and [Defendant]... it was always [Intervenor’s] intent to enforce an agreement between [Intervenor] and [Defendant] as to the borrowed funds, and as in the prior demurrer, [Defendant] attempts to sidestep these allegations by focusing on a third-party contract when that is not what is directly at play. At no point in time is the borrowing of funds from Mr. Oransky ever omitted.” (Opp., 4-5.)

Intervenor goes on to explain that claims the Property was bought for their mutual benefit have been realleged, and any conditioning of their marriage on living in the Los Angeles area have been removed because they were irrelevant. (Opp., 6.) “The SACI does not omit any material facts which are harmful to [Intervenor], and which would serve as any basis for a sham pleading doctrine to be invoked by the Court. As stated herein, [Intervenor]was simply following the Court’s guidance from the previous Demurrer and Motion to Strike to add more focused allegations as to what was important.” (Id.)

In reply, Defendant points to two examples of contradictory changes made in the SACI. (Reply, 2.) Specifically, Defendant points to:

-“Parzivand never intended to make the down-payment for both of their benefits and instead sought to purposefully have this Property without Intervenor.” (SACI, ¶27.)

-“Zelener and Parzivand purchased the [Property] for the benefit of Parzivand and Intervenor on or around October 27, 2017 to serve as their marital residence. (FACI, ¶10.) Intervenor and Parzivand further agreed that $120,000 of this amount would be used as a down payment to purchase the Property. (FACI ¶16.)

- “Intervenor now understands and alleges that Parzivand had no intention of performing his obligations as promised to Intervenor pursuant to the Agreement. (SACI, ¶29.)

- “Intervenor and Parzivand also agreed that they would make (and did so make) monthly interest payments of $500.00 per month on the loan. From the time of their marriage to approximately the time of their separation, Parzivand and Intervenor made said monthly payments.” (FACI, ¶17.) (Reply, 1.)

Defendant contends these changes show Intervenor’s request for declaration “has been effectively abandoned for direct monetary claims against Daniel based on a breach and an inducement of a two-party oral guarantee. As the facts and circumstances become solid, the complaint in intervention has changed to survive.” (Reply, 1-2.) Defendant further contends the SACI now contradicts “its priors to better support a claim for malicious inducement of an oral guarantee instead of a declaration concerning a three-party loan.” (Reply, 2.)

Upon review of the FACI, the court notes that the first amended pleading also included the contention of a “mutual understanding” between Intervenor and Defendant, stating: “To purchase the Property, Intervenor and Parzivand borrowed approximately $150,000.00 from Leon Oranksy with the mutual understanding that Intervenor and Parzivand would make monthly payments to pay down the loan, and repay any outstanding amounts from the sale of the Property. That money along with Intervenor’s own separate property money was also used to repair and upgrade the Property between October 2017 and August 2018.” (FACI, ¶10.) The court also notes that its prior Minute Order sustaining Defendant’s demurrer to the FACI acknowledged the alleging of claims against “arrangements” between the parties here, outside of the Oranksy loan. (Minute Order, July 11, 2022, 4-6.)

As such, the court does not find substantive omissions in the SACI and concludes the SACI is not a sham pleading. Therefore, the court overrules Defendant’s demurrer on these grounds and continues with an analysis of the merits of the claims.

A cause of action for¿breach of contract consists of the following elements: (1) the existence of a contract; (2) the plaintiff’s performance or excuse for nonperformance; (3) the defendant’s breach; and (4) the resulting damages to the plaintiff.¿ (Oasis West Realty, LLC v. Goldman¿(2011) 51 Cal.4th 811, 821.)¿“The essence of a contract is the meeting of minds on the essential features of the agreement.” (Krasley¿v. Superior Court¿(1980) 101 Cal.App.3d 425, 431.) A contract “is unenforceable if the parties fail to agree on a material term or if a material term is not reasonably certain.” (Lindsay v. Lewandowski¿(2006) 139 Cal.App.4th 1618, 1623.)¿

A¿written¿contract must be pled verbatim in the body of the complaint, be attached to the complaint and incorporated by reference, or be pled according to its legal effect.¿¿(Bowden v. Robinson¿(1977) 67 Cal.App.3d 705, 718.)¿¿An allegation of an oral agreement must “set[] forth the substance of its relative terms.”¿ (Gautier v. General Tel. Co.¿(1965) 234 Cal.App.2d 302, 305.)¿¿¿

The statute of frauds bars enforcement of agreements that by its terms is not to be performed within a year from its making, unless confirmed in some form of writing and “subscribed by the party to be charged.” (See Civ. Code § 1624(a).)

Defendant contends the second cause of action of the SACI is insufficiently pled pursuant to the Statute of Frauds, and specifically Civ. Code § 1624. (Demurrer, 3-4.) Defendant correctly explains “[a] to pay the debt of another is unenforceable unless in writing.” (Demurrer, 3; citing Civ. Code § 1624(a)(2).) “The SACI’s oral agreement is thus a second promise to pay [Defendant] and [Intervenor’s] already-existing debt, which in this context is unenforceable. Because the agreement is oral, the SAC agreement cannot be enforced to make [Defendant] pay the interest or loan principal promised in the three-party Oransky loan agreement.” (Demurrer, 4.) As such, Defendant contends the oral agreement as alleged is unenforceable. (Id.)

Defendant also contends that the second cause of action is further insufficiently pled as it does not allege when or how a breach of the two-person oral contract occurred, does not request relief as permitted by the agreement, and that Intervenor lacks further standing to recover any monies owed to third party lender Oranksy. (Demurrer, 4-6.) Lastly, Defendant contends any new allegations of an anticipatory breach are a new theory of liability for a breach of contract which was not permissible following the court’s sustaining of Defendant’s earlier demurrer. (Demurrer, 6.)

In opposition, Intervenor contends that the SACI is enforceable under the statute of frauds because the parties made their agreement before obtaining the Oransky loan. (Opp., 7.) Intervenor also contends that all elements for a breach of contract have been alleged, and specifically, “the pleading alleges that [Defendant] breaches the terms of the agreement by ceasing to make or contribute to any monthly interest payments.” (Opp., 8; citing SACI ¶22.) Intervenor also contends she has standing to bring her claims as “[Intervenor] is the one who has suffered and will suffer as a result of [Defendant’s] breach of the agreement in failing to make the monthly payments, but in also denying the existence of the loan and the parties’ agreement altogether.” (Opp., 9-10.) Lastly, Intervenor contends the allegations of an “anticipatory breach” do not introduce a new theory of liability as they are the identical allegations in the FACI and are further irrelevant as Defendant “has already breached the terms of the agreement by not making his monthly interest payments.” (Opp., 10-11.)

In reply, Defendant correctly points out that Civil Code §§ 1624(a)(1-2) are applicable here, as the agreement between Intervenor and Defendant was not to be performed within a year, and in making an agreement to pay as part of another agreement to secure a loan, Intervenor and Defendant made an oral promise to be liable for the debt of another. (Reply, 3-4.) Pursuant to the statute of frauds, these agreements cannot be enforced.

Thus, Intervenor and Defendant made an oral agreement which would not have been performed within a year, and further made an agreement to be liable to one another for the debt of the other to a third-party, here the Oranksy loan. Based on a review of the allegations of the SACI and the relevant portions of the statute of frauds, the court finds the agreement between Intervenor and Defendant to be unenforceable.

Therefore, for these reasons, the court sustains Defendant’s demurrer as to this cause of action.

California courts have recognized that “[t]he existence of an ‘actual controversy relating to the legal rights and duties of the respective parties,’ suffices to maintain an action for declaratory relief.”¿ (Ludgate Ins. Co. v. Lockheed Martin Corp.¿(2000) 82 Cal.App.4th 592, 605 (Ludgate).)¿ “Any person interested under a written instrument, ... or under a contract, or who desires a declaration of his or her rights or duties with respect to another, or in respect to, in, over or upon property,¿ ... may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action or cross-complaint in the superior court ... for a declaration of his or her rights and duties in the premises, including a determination of any question of construction or validity arising under the instrument or contract."¿ (Ibid., quoting CCP § 1060.)¿¿¿

Here, Defendant again contends the first cause of action to be derivate of the other causes of action of the SACI, and therefore contends the first cause of action to also be insufficiently pled. (Demurrer, 11.) Defendant again further contends the first cause of action seeks adjudication of past events, and seeks to change of the alleged agreement since the relief sought “would amount to a reformation of the oral guarantee agreement.” (Demurrer, 12-13.) Defendant again contends “Declaratory Relief cannot be used to accomplish such a radical modification.” (Id.)

In opposition, Intervenor accedes the first cause of action is derivative but states “it should survive [the] demurrer because as explained above, the breach of contract claim itself is sufficiently pled.” (Opp., 13.)

As the court has sustained Defendant’s demurrer as to the other causes of action, the court also finds this cause of action to be derivative of those claims. Therefore, the court again sustains Defendant’s demurrer to this cause of action as well.

Fraud must be pled in the complaint specifically. General and conclusory allegations are not sufficient. (Nagy v. Nagy (1989) 210 Cal.App.3d 1262, 1268.) Unlike most causes of action where the “the policy of liberal construction of the pleadings,” fraud requires particularity, that is, “pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.) Every element of a fraud cause of action must be alleged both factually and specifically. (Hall v. Department of Adoptions (1975) 47 Cal.App.3d 898, 904; Cooper v. Equity General Insurance (1990) 219 Cal.App.3d 1252, 1262.)

The elements of a fraud cause of action are: (1) misrepresentation (false representation, concealment, or omission); (2) knowledge of falsity; (3) intent to induce reliance; (4) justifiable reliance; and (5) resulting damage. (Davis v. Southern California Edison Co. (2015) 236 Cal.App.4th 619.) Fraud must be pled in the complaint specifically. General and conclusory allegations are not sufficient. (Stansfield v. Starkey¿(1990)¿220 Cal.App.3d 59,¿74;¿Nagy v. Nagy¿(1989) 210 Cal.App.3d 1262, 1268.) Unlike most causes of action where the “the policy of liberal construction of the pleadings,” fraud requires particularity, that is, “pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Stansfield, supra, 220 Cal.App.3d at 73;¿Lazar v. Superior Court¿(1996) 12 Cal.4th 631, 645.) Every element of a fraud cause of action must be alleged both factually and specifically. (Hall v. Department of Adoptions¿(1975) 47 Cal.App.3d 898, 904; Cooper v. Equity General Insurance¿(1990) 219 Cal.App.3d 1252, 1262.)¿

Here, Defendant again contends Intervenor has failed to meet the heightened pleading requirements for fraud claims, and thus contends the third cause of action to be insufficiently pled. (Demurrer, 7-8.) Defendant further contends that the amendments to the fraud cause of action seek to introduce a new theory for liability and again fails to allege the “when” and the “how” of any alleged fraudulent misrepresentations. (Demurrer, 8-9.) Lastly, Defendant contends the third cause of action is further insufficiently pled as Intervenor does not allege “any financial detriment that she has supposedly suffered.” (Demurrer, 10-11.)

In opposition, Intervenor does not point to specific factual allegations made with regard to the heightened pleading standard, but rather goes on to reassert the conclusory contentions regarding Defendant’s intentions solely. (Opp., 12.)

As such, the court agrees with Defendant that the SACI again lacks sufficient allegations demonstrating fraudulent intent and damages suffered. (Reply, 7-9.) In the absence of allegations regarding the fraudulent intent again and the damages suffered as a result of justifiable reliance on these misrepresentations, the court finds the third cause of action to be insufficiently pled again.

The court therefore again sustains Defendant’s demurrer as to this cause of action.

Defendant’s demurrer is sustained, without leave to amend. Defendant is to give notice.

[1] Defendant again submits the declaration of their counsel, Terry J. Kent (“Kent”), to demonstrate compliance with statutory meet and confer requirements. Kent attests that on August 10, 2022, counsel emailed Intervenor’s counsel a meet and confer letter outlining the alleged deficiencies in the SACI. (Kent Decl. ¶ 3.) Kent attests on August 18, 2022, counsel met and conferred with Intervenor’s counsel and the parties did not reach a resolution regarding the issues raised in this Demurrer. (Kent Decl. ¶4.) The court finds that Defendant’s meet and confer efforts prior to filing the instant demurrer and motion to strike are sufficient for purposes of CCP §§ 430.41 and 435.5.