Judge: Gary I. Micon, Case: 22CHCV00789, Date: 2024-04-03 Tentative Ruling
Case Number: 22CHCV00789 Hearing Date: April 3, 2024 Dept: F43
Dept. F43
Date: 4-3-24
Case # 22CHCV00789, Edgar Ramirez vs. Mercedes Benz
USA, LLC, et al.
Trial Date: N/A
DEMURRER TO FIRST AMENDED COMPLAINT WITH
MOTION TO STRIKE
MOVING PARTY: Defendant Mercedes-Benz USA, LLC
RESPONDING PARTIES: No response has been filed
RELIEF REQUESTED
Demurrer to the First Amended Complaint (FAC)
·
1st Cause of Action for Breach of
Written Contract
·
2nd Cause of Action for Intentional
Misrepresentation
·
3rd Cause of Action for Violation of
California’s Consumers Legal Remedies Act (CLRA)
Motion to Strike
·
Any reference to Merecedes-Benz USA, LLC as
having a DBA
RULING: Demurrer sustained in its entirety; motion
to strike granted
SUMMARY OF ACTION
On February 25, 2019, Plaintiff Edgar Ramirez (Plaintiff)
purchased a used 2016 Mercedes C300W from Keyes European in Van Nuys. Plaintiff
purchased the vehicle through a Retail Installment Sales Contract (RISC) with
Keyes European. There was an optional debt cancellation agreement/GAP insurance
policy included with the RISC. Defendant Mercedes-Benz USA, LLC (Defendant
MBUSA) was not a party to the RISC.
Plaintiff was involved in a collision on December 22,
2019, that rendered the vehicle a total loss. At some point thereafter,
Plaintiff invoked the protection of the Ownerguard debt cancellation insurance
policy, but Plaintiff’s claim was denied. Plaintiff appears to allege that the
claim was denied because Ownerguard was replaced with MBF on the RISC.
Plaintiff understood MBF to be Mercedes Benz Financial. After the denial,
Plaintiff also submitted claims to Mercedes Benz Financial, Mercedes-Benz USA,
LLC, and Keyes European, but these were all denied, as well. Plaintiff
submitted a pre-litigation demand pursuant to the CLRA to Defendant Hak Inc.
(Keyes European).
Plaintiff filed his complaint on September 27, 2022. The
Court granted with leave to amend Ownerguard’s demurrer to Plaintiff’s causes
of action for breach of contract, breach of express warranty, intentional
misrepresentation, and libel.
Plaintiff filed his FAC on October 16, 2023. Plaintiff
alleged four causes of action for breach of contract, intentional
misrepresentation, violation of the CLRA, and negligence per se. Defendant
MBUSA filed its demurer with motion to strike on November 16, 2023. No
opposition has been filed.
Request for Judicial Notice: Defendant has requested that
the Court take judicial notice of the entity details of Mercedes Benz Financial
Services USA from the Department of State for the State of Delaware showing that
Mercedes Benz Financial Services USA is a distinct corporate entity. Defendant
has also request that the Court take judicial notice of the webpage from The
Michigan Department of Licensing and Regulatory Affairs showing the entity
information for Mercedes Benz Financial Services. Finally, Defendant has
requested that the Court take judicial notice of Plaintiff’s complaint. The
Court takes judicial notice of these documents.
ANALYSIS
Defendant MBUSA brings a demurrer to Plaintiff’s First,
Second, and Third Causes of Action on the basis that they fail to state facts
sufficient to constitute causes of action against Defendant.
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.) “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.) 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 applying these standards, the court liberally
construes the complaint to determine whether a cause of action has been stated.
(Picton v. Anderson Union High School
Dist. (1996) 50 Cal.App.4th 726, 733.)
First Cause of Action
Defendant demurs to Plaintiff’s breach of contract cause of
action.
To establish a claim for breach of contract, Plaintiff must
show (1) the existence of a valid contract between Plaintiff and Defendant, (2)
Plaintiff’s performance or excuse of non-performance, (3) Defendant failed to
do something required by the contract; (4) Plaintiff was harmed and; (5) that
the breach of contract was a substantial factor in causing Plaintiff’s harm.
(See Richman v Hartley (2014) 224 Cal.App.4th 1182, 1186.) Where there
is no contractual relationship between plaintiff and the defendant charged with
the breach, no claim for breach of contract lies. (Austero v National Cas.
Co. (1976) 62 Cal.App.3d 511, 515-517.)
Defendant argues that there is no contractual relationship
between it and Plaintiff because the Retail Installment Sales Contract (RISC)
upon which Plaintiff bases his complaint was between Plaintiff and Sell-Creditor
Keyes European. (See RJN, Ex. C, Ex. A.) Because Defendant Mercedes-Benz USA is
not a party to the contract, it cannot be held liable for a breach of the
contract.
To that end, Plaintiff’s FAC is also vague as to what
exactly constituted the breach. Plaintiff alleges something about one insurance
company being replaced by another in the RSIC after Plaintiff had signed it,
and that this constituted the breach. (FAC, ¶ 30.) Plaintiff also refers to a
GAP insurance policy being breached, but Plaintiff fails to provide any of the
terms of this policy or how that policy was breached. Plaintiff’s FAC further
states that Plaintiff is demanding that the Manufacturer cancel the sale (FAC,
¶ 33), but it does not appear, from the facts alleged and the attached RSIC,
that the manufacturer was a party to the sale.
To the extent that Plaintiff included allegations about
Mercedes Benz Financial Services USA and is attempting to allege that Mercedes
Benz Financial Services USA is a DBA of Defendant MBUSA, that is clearly not
the case, as the State entity reports attached to Defendant’s Request for
Judicial Notice demonstrate that it is a distinct legal entity.
For these reasons, Defendant’s demurrer to Plaintiff’s First
Cause of Action for breach of contract is sustained with leave to amend.
Second Cause of Action
Defendant demurs to the Second Cause of Action for
intentional misrepresentation.
The elements for intentional misrepresentation are (1)
misrepresentation of a material fact; (2) knowledge of falsity (scienter); (3)
intent to deceive and induce reliance; (4) justifiable reliance on the
misrepresentation (or concealment); (5) resulting damage (City of Atascadero
v. Merrill Lynch (1998) 68 Cal.App.4th 445, 482.)
Unlike most causes of action where the policy is “liberal
construction of the pleadings,” claims for fraud require particularity, that
is, “pleading facts which show how, when, where, to whom, and by what means the
representations were tendered.” (Stansfield v. Starky (1990) 220
Cal.App.3d 59, 73; Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)
The policy of liberally construing pleadings is not invoked for defective fraud
claims. (See Wilhelm v. Pray, Price, Williams & Russell (1986) 186
Cal.App.3d 1324, 1332.) The specificity requirement applies to every element of
a fraud cause of action. (Hall v. Department of Adoptions (1975) 47
Cal.App.3d 898, 904; Cooper v. Equity General Insurance (1990) 219
Cal.App.3d 1252, 1262.)
Plaintiff’s FAC fails to allege with particularity the “how,
when, where, to whom, and by what means” of fraud claims. Plaintiff’s FAC just
states that “Defendants” in general “intentionally misrepresented the terms of
the agreement.” (FAC, ¶ 40.) Plaintiff does not say which Defendants, or say
who was making these misrepresentations on behalf of Defendants. Plaintiff also
does not allege what assertions made by Defendants were misrepresentations.
Plaintiff’s cause of action for intentional
misrepresentation is too vague and does not contain the required specificity
for a fraud cause of action. Defendant’s demurrer to Plaintiff’s Second Cause
of Action is sustained with leave to amend.
Third Cause of Action
Defendant demurs to Plaintiff’s Third Cause of Action for
Violation of the CLRA.
The purpose of the CLRA is to protect consumers from injury
caused by false representations made by merchants as part of a transaction for
the sale of consumer goods. (Nelson v. Pearson Ford Co. (2010) 186
Cal.App.4th 983, 1021.) Plaintiff does not allege that Defendant MBUSA was
involved in the transaction for the sale of the vehicle.
Despite stating that the Third Cause of Action was against
all Defendants, Plaintiff only states that Defendant Hak, Inc., (Keyes European
LLC) violated the CLRA. (FAC, ¶ 48.) There is no mention of Defendant MBUSA
under this cause of action.
Furthermore, prior to filing a claim pursuant to the CLRA
seeking damages, a plaintiff is required to notify the prospective defendant of
the alleged violation of the CLRA and demand that the violation be rectified
and corrections made within a reasonable time. This demand must be made at
least 30 days before the filing of a Complaint or the cause of action will not
lie. (Civil Code § 1782; Morgan v AT&T Wireless Services, Inc.
(2009) 177 Cal.App.4th 1235, 1259-1260.) Plaintiff’s FAC only alleged that he
notified Hak, Inc., (Keyes European) of the violations of the CLRA. (FAC, ¶
50.) Not alleging that he notified MBUSA is also grounds for sustaining the
demurrer.
Defendant’s demurrer to Plaintiff’s Third Cause of Action is
sustained with leave to amend.
Motion to Strike
Defendant has moved to strike any references to
Mercedes-Benz USA, LLC as having a DBA, as no such DBA exists.
This Court may strike from the complaint any irrelevant,
false, or improper matter. Under CCP § 435, “[a]ny party, within the time
allowed to respond to a pleading may serve and file a notice of motion to
strike the whole or any part thereof.” Under CCP § 436(a), “[t]he court may,
upon a motion made pursuant to Section 435, or at any time in its discretion,
and upon terms it deems proper . . . [s]trike out any irrelevant, false, or
improper matter inserted in any pleading.”
Based on its Request for Judicial Notice showing that Mercedes
Benz Financial is a distinct entity, Defendant is requesting that the Court
strike references to MBUSA having a DBA as false allegations. The only obvious
reference to the DBA is in the caption on the first page of the FAC. The DBA
appears to be implied in the rest of the FAC.
As demonstrated by Exhibits A and B to the Request for
Judicial Notice, it is false and improper for Plaintiff to refer to Mercedes
Benz Financial as a DBA of MBUSA. Any such references, or implied references,
are ordered stricken from the complaint.
Conclusion
Defendant’s demurrer is sustained with leave to amend for
Plaintiff’s First, Second, and Third Causes of Action. Defendant’s motion to
strike is granted.
Plaintiff is given 30 days to file an amended complaint.
Moving party to give notice.