Judge Gail Killefer, Case Number: 22STCV37626, Date: 2024-04-15 Tentative Ruling

CASE NAME: Brendan Schultz v. Israaid (US) Global Humanitarian Assistance, Inc.

TENTATIVE: The demurrer to the first, second, third, fourth, and ninth causes of action is sustained without leave to amend. The demurrer to the ninth cause of action is sustained with leave to amend. Plaintiff is granted 30 days leave to amend. The court sets the OSC RE: Amended Complaint for May 29, 2024, at 8:30 a.m. Defendant to give notice.

On December 1, 2022, Brendan Schultz (“Plaintiff”) filed a Complaint against Issraaid (US) Global Humanitarian Assistance, Inc. (“Defendant”) and Does 1 to 100.

The operative Second Amended Complaint (“SAC”), filed August 28, 2023, alleges nine causes of action: (1) Negligence; (2) Gross Negligence; (3) Willful Misconduct; (4) Reckless Misconduct; (5) Failure to Pay Minimum Wage; (6) Failure to Provide Meal Periods; (7) Failure to Pay Rest Periods; (8) Negligent Misrepresentation; and (9) Negligent Infliction of Emotional Distress.

On January 25, 2024, Defendant filed a demurrer to Plaintiff’s SAC. Plaintiff opposes the demurrer. The matter is now before the court.

Discussion

Where pleadings are defective, a party may raise the defect by way of a demurrer. (Coyne v. Krempels (1950) 36 Cal.2d 257, 262.) A demurrer tests the sufficiency of a pleading, and the grounds for a demurrer must appear on the face of the pleading or from judicially noticeable matters.¿ (CCP, § 430.30(a); Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) In evaluating a demurrer, the court accepts the complainant’s properly pled facts as true and ignores contentions, deductions, and conclusory statements. (Daar v. Yellow Cab Co. (1976) 67 Cal.2d 695, 713; Serrano v. Priest (1971) 5 Cal.3d 584, 591.) Moreover, the court does not consider whether a plaintiff will be able to prove the allegations or the possible difficulty in making such proof. (Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590, 604.)

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 complainant to show the Court that a pleading can be amended successfully. (Ibid.)

The SAC alleges that Plaintiff worked as a volunteer with Defendant’s food distribution program during the summer of 2020. (SAC ¶ 3, 6, 7.)

On February 4, 2021, in a virtual meeting with Defendant, Defendant offered Plaintiff a contract position as a volunteer coordinator for its volunteer program. (SAC ¶ 10.) Plaintiff accepted the position, signed a contract, and entered an employment relationship with Defendant on February 15, 2021. (SAC ¶¶ 11, 12.)

Plaintiff alleges that Defendant falsely represented that the position would abide by the requirements for contract worker classification. Plaintiff alleges he should have been classified as a regular employee. (SAC ¶¶ 13, 14, 15.)

As Plaintiff should have been classified as an employee, he contends he should have been paid minimum wage and provided meal/rest breaks or overtime pay. (SAC ¶ 16.) After informing Defendant’s supervisor in early May 2021 that he thought the requirements of the position did not comply with California labor law, Defendant informed Plaintiff of the intent to terminate the employment relationship. (SAC ¶¶ 16, 17.)

Plaintiff filed this action on December 1, 2022. Defendant now demurs to the first, second, third, fourth, eighth, and ninth causes of action on the basis that the facts pled are insufficient to support said causes of action (CCP, § 430.10(3).)

The court is aware that Plaintiff has failed to file a proof of service for its opposition and that Defendant asserts they could only review the opposition until April 10, 2024. (Albert Supp. Decl. ¶ 4.) However, as Defendant has failed to allege that it was prejudiced by the late opposition, the court will proceed to address the demurrer on the merits. (See Tate v. Superior Court (1975) 45 Cal.App.3d 925, 930 [The court may treat the appearance of Defense counsel at the hearing and her opposition to the motion on its merits as a waiver of defective notice of the motion.].)

C. First, Second, Third, and Fourth Causes of Action – Negligence, Gross Negligence, Willful Misconduct, Reckless Misconduct

“The elements of a cause of action for negligence are well established. They are (a) a legal duty to use due care; (b) a breach of such legal duty; [and] (c) the breach as the proximate or legal cause of the resulting injury.” (Ladd v. County of San Mateo (1996) 12 Cal.4th 913, 917 [internal quotations omitted].) “A duty may arise through statute, contract, or the relationship of the parties.” (Lichtman v. Siemens Industry Inc. (2017) 16 Cal.App.5th 914, 920 [internal quotations and citations omitted].) The existence of a legal duty is a question of law for the court to decide. (Adams v. City of Fremont (1998) 68 Cal.App.4th 243, 265.) “However, the elements of breach of that duty and causation are ordinarily questions of fact for the jury's determination.” (Vasquez v. Residential Investments, Inc. (2004) 118 Cal.App.4th 269, 278.)

Defendant argues that the first cause of action (negligence) fails because the only duty an employer owes an employee is the duty to provide a safe working environment. Although Labor Code § 226.8 imposes on employers a legal duty to not willfully misclassify an individual as an independent contractor, there is no private right of action for violations of section 226.8. (Noe v. Superior Court (2015) 237 Cal.App.4th 316, 341.) Accordingly, Plaintiff fails to show that Defendant owed Plaintiff a legal duty to not misclassify employees^{^[2]}.

With respect to the second cause of action (gross negligence), the Judicial Council of California Civil Jury Instructions (“CACI”) No. 425 clarifies that gross negligence is not a cause of action, but a judicial instruction given when a statute or contract provides for a high standard of care. “California does not recognize a distinct cause of action for ‘gross negligence’ independent of a statutory basis.” (Eriksson v. Nunnink (2011) 191 Cal.App.4th 826, 856.)

With respect to the third cause of action (willful misconduct), willful misconduct is not a cause of action but “‘an aggravated form of negligence, differing in quality rather than degree from ordinary lack of care’ [Citations.]” (Berkley v. Dowds (2007) 152 Cal.App.4th 518, 526.) “Its pleading requirements are similar to negligence but stricter.” (Id. at p. 526.)

With regard to the fourth cause of action (reckless misconduct), reckless misconduct is similarly a form of aggravated negligence “differing in quality rather than degree from lack of ordinary care.” (Morgan v. Southern Pacific Trans. Co. (1974) 37 Cal.App.3d 1006, 1011.)

Plaintiff fails to cite case law or statute to show that Defendant had a duty to not misclassify Plaintiff or that a specific statute imposed on Defendant a heightened duty of care that prohibited gross negligence or willful or reckless misconduct.

Accordingly, the court sustains the demurrer to the first, second, third, and fourth causes of action without leave to amend.

“The elements of negligent misrepresentation, a form of deceit, are misrepresentation of a past or existing material fact, without reasonable ground for believing it to be true, and with intent to induce another's reliance on the fact misrepresented; ignorance of the truth and justifiable reliance on the misrepresentation by the party to whom it was directed; and resulting damage.” (Home Budget Loans, Inc. v. Jacoby & Meyers Law Offices (1989) 207 Cal.App.3d 1277, 1285.) Claims for negligent misrepresentation, like fraud claims, must be pled with the requisite specificity. (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.)

The eighth cause of action alleges that Defendant misrepresented that Plaintiff was a formal employee as opposed to a contractor. (SAC ¶ 76.) Plaintiff alleges that had he known he was an independent contractor he would not have performed “labor for defendant” and he was harmed because he did not receive minimum wage. (SAC ¶¶ 79, 80.)

The SAC fails to allege who specifically told Plaintiff that he would be hired and managed as an independent contractor rather than an employee or what authority that individual had to speak on behalf of Defendant. Moreover, Plaintiff failed to plead the element of reliance: that because he relied on the representation that he would be managed as an independent contractor, he would have still performed the same work as an employee and would have “performed labor for the defendant.” (SAC ¶ 79.) The difference between being an independent contractor and an employee is the degree of control exercised over Plaintiff and the wages due rather than the labor performed.

Based on the above, the demurrer to the eighth cause of action is sustained with leave to amend.

California courts have repeatedly recognized that NIED is not an independent tort, but the tort of negligence such that the traditional elements of duty, breach of duty, causation, and damages apply. (See, e.g., Spates v. Dameron Hospital Association (2003) 114 Cal.App.4th 208, 213; Marlene F. v. Affiliated Psychiatric Medical Clinic, Inc. (1989) 48 Cal.3d 583, 588.) other duty to the plaintiff.” (Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965, 984.) “[U]nless the defendant has assumed a duty to plaintiff in which the emotional condition of the plaintiff is an object, recovery is available only if the emotional distress arises out of the defendant’s breach of some other legal duty and the emotional distress is proximately caused by that breach of duty.” (Id. at 985.) “Even then, with rare exceptions, a breach of the duty must threaten physical injury, not simply damage to property or financial interests.” (Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965, 984.)

As Plaintiff’s negligence claim fails, so does Plaintiff’s NIED claim. “Whether plaintiffs can recover damages for NIED is dependent upon traditional tort analysis and the elements of duty, breach of duty, causation, and damages must exist to support the cause of action.” (Klein v. Children’s Hospital Medical Center (1996) 46 Cal.App.4th 889, 894.)

The demurrer to the first, second, third, fourth, and ninth causes of action is sustained without leave to amend. The demurrer to the ninth cause of action is sustained with leave to amend. Plaintiff is granted 30 days leave to amend. The court sets the OSC RE: Amended Complaint for May 29, 2024, at 8:30 a.m. Defendant to give notice.

[1] Pursuant to CCP § 430.41, the meet and confer requirement has been met. (Albert Decl. ¶ 5, Ex. D.)

[2] “[W]here a statute creates a right that did not exist at common law and provides a comprehensive and detailed remedial scheme for its enforcement, the statutory remedy is exclusive.” (Stevenson v. Superior Court (1997) 16 Cal.4th 880, 900 [internal citations and quotations omitted].)