Judge: Gary I. Micon, Case: 23CHCV02864, Date: 2024-03-19 Tentative Ruling

Case Number: 23CHCV02864    Hearing Date: March 19, 2024    Dept: F43

Dept. F43

Date: 3/19/2024

Case # 23CHCV02864, Rico Ellis v. Exeter Finance, LLC

Trial Date: None

DEMURRER TO ANSWER

MOVING PARTY: Plaintiff Rico Ellis

RESPONDING PARTY: Defendant Exeter Finance LLC

RELIEF REQUESTED

Moving party requests the Court to enter an order sustaining his demurrer to the affirmative defenses raised in Defendant Exeter Finance LLC’s Answer.

RULING: The demurrer hearing is CONTINUED to April 30, 2024, at 8:30 a.m., Dept. F43, Chatsworth Courthouse. Defendant Exeter Finance LLC’s Motion to Compel Arbitration and Stay Action shall be heard first, followed by the demurrer.  

SUMMARY OF ACTION

On September 26, 2023, Plaintiff Rico Ellis (“Plaintiff”) filed this action against Defendants Exeter Finance, LLC (“Defendant”) and Does 1 to 5, asserting causes of action for (1) negligence, (2) fraud, and (3) conversion.

The Complaint alleges the following.

On or around October 11, 2021, Plaintiff purchased a 2018 Hyundai Ioniq vehicle financed by Defendant. (Compl., ¶ 6.)  

On or around “2016” (even though the vehicle is a “2018” vehicle and bought in “2021”), in Texas, Plaintiff received a citation (the Complaint does not explain the reason for the citation). (Compl., ¶ 7.)

On or around July 23, 2023, the Los Angeles County Sheriff’s Department pulled Plaintiff over, informed him that a $20 administration fee associated with the 2016 Texas citation remained outstanding (despite Plaintiff’s receipt showing the fee had been paid), and impounded the vehicle. (Compl., ¶¶ 8-10.)

On or around August 10, 2023, the defendants told Plaintiff they could retrieve his vehicle on his behalf to preclude additional fees, liens, and sales. (Compl., ¶ 12.)

Despite those representations, the fact that Plaintiff had been making payments on his car note, and Plaintiff was not in breach of his contractual obligations, the defendants, on or around August 10, 2023, sent Plaintiff a letter titled Notice of Our Plan to Sell Property, informing him that they will sell his vehicle at a private sale in August 2023 because Plaintiff had “broken promises in [the parties’] agreement.” (Compl., ¶¶ 14-17.)

Despite Plaintiff sending the defendants letters to cease the sale of his vehicle, on or around September 1, 2023, the defendants sold his vehicle and reported the repossession to Equifax, Experian, and TransUnion, making it difficult for Plaintiff to obtain credit from lending institutions. (Compl., ¶¶ 14-17.)

On November 6, 2023, Defendant filed its Answer to the Complaint.

On November 14, 2023, Plaintiff filed the instant demurrer to the Answer.

On February 8, 2024, Defendant filed its pending Motion to Compel Arbitration and Stay Action set for hearing on April 30, 2024.

On March 6, 2024, Exeter Finance filed its opposition to the demurrer.

As of March 16, 2024, no reply to the opposition has been filed.

ANALYSIS

Requests for Judicial Notice: No requests for judicial notice have been filed.

Evidentiary Objections: No evidentiary objections have been filed.

Summary of Arguments

Plaintiff argues the following in his moving papers. None of the affirmative defenses in Defendant’s Answer state facts sufficient to constitute a defense to the Complaint or any cause of action in the Complaint. In addition, all of the defenses are uncertain. Each affirmative defense is nothing more than terse conclusions of law without any factual support. Accordingly, the Court should sustain the demurrer, and the Defendant should be ordered to file an amended answer. 

In its opposition, Defendant argues the following. The parties’ contract contains an arbitration provision requiring Plaintiff to arbitrate his claims. Given that arbitration agreement, the Court is not the right forum to adjudicate the sufficiency of Defendant’s affirmative defenses. Therefore, Defendant asks the Court to defer its ruling on the demurrer until the Court has heard Defendant’s motion to compel arbitration. If the Court decides to consider the demurrer on its merits, then the Court should overrule the demurrer for two reasons. First, Defendant has pleaded its affirmative defenses with as much factual specificity as necessary. Second, leave to amend must be liberally granted should the Court find the Answer insufficient.

Case Law

Code of Civil Procedure section 430.20 provides: “A party against whom an answer has been filed may object, by demurrer …, to the answer upon any or more of the following grounds: ¶ (a) The answer does not state facts sufficient to constitute a defense. ¶ (b) The answer is uncertain. As used in this subdivision, ‘uncertain’ includes ambiguous and unintelligible.”

“A demurrer for uncertainty is strictly construed, even where a complaint is in some respects uncertain, because ambiguities can be clarified under modern discovery procedures.” (Khoury v. Maly’s of Cal., Inc. (1993) 14 Cal.App.4th 612, 616.) Such demurrers “are disfavored, and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.” (Mahan v. Charles W. Chan Insurance Agency, Inc. (2017) 14 Cal.App.5th 841, 848.)         

“The granting or refusing of leave to amend an answer is within the sound discretion of the court. Such discretion will seldom be disturbed where exercised for the purpose of allowing the true facts to be alleged.” (Hyman v. Tarplee (1944) 64 Cal.App.2d 805, 813.) “The rule that the court should be liberal in allowing amendments when they do not seriously impair the rights of the opposite party is particularly applicable to answers.” (Id. at pp. 813-814.)

Application to Case

The ruling on Defendant’s Motion to Compel Arbitration and Stay Action may render the demurrer moot.

Accordingly, the Court will continue the demurrer hearing to the same date as the hearing on Defendant’s motion.  

Conclusion

The demurrer hearing is CONTINUED to April 30, 2024, at 8:30 a.m., Dept. F43, Chatsworth Courthouse. Defendant Exeter Finance LLC’s Motion to Compel Arbitration and Stay Action shall be heard first, followed by the demurrer.  

Moving party to give notice.