Judge: H. Jay Ford, III, Case: 23SMCV04586, Date: 2024-07-11 Tentative Ruling

Case Number: 23SMCV04586    Hearing Date: July 11, 2024    Dept: O

  Case Name:  Gilerman v. Lisitsa, et al.

SUBJECT:                 DEMURRER W/O MOTION TO STRIKE

MOVING PARTY:   (1) Defendants Yevgeniya Lisitsa and Lisitsa Law, Inc.;

                                    (2) Defendant Michael Shemtoub

RESP. PARTY:         Plaintiff Erina Gilerman

TENTATIVE RULING

            Defendants Yevgeniya Lisitsa and Lisitsa Law, Inc. (collectively “Lisitsa”) Demurrer to the 1^st cause of action for breach of contract and the 3^rd cause of action for fraud is SUSTAINED WITHOUT LEAVE TO AMEND.

            Defendant Michael Shemtoub  and Lisitsa (collectively “Defendants”) Demurrer to 3^rd cause of action for fraud is SUSTAINED WITHOUT LEAVE TO AMEND

            Defendants RJN is GRANTED as to the documents requested but not to the truth of the facts asserted within the documents. (See Glaski v. Bank of America (2013) 218 Cal.App.4th 1079, 1090 [“Courts can take judicial notice of the existence, content and authenticity of public records and other specified documents, but do not take judicial notice of the truth of the factual matters asserted in those documents.”].)

            Plaintiffs RJN is GRANTED as to the documents requested but not to the truth of the facts asserted within the documents. (See Glaski, supra, 218 Cal.App.4th at p. 1090.)

REASONING

An action against an attorney for a wrongful act or omission, other than for actual fraud, arising in the performance of professional services shall be commenced within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first.

(Code Civ. Proc., § 340.6, subd. (a).)

            The CCP § 340.6(a) “time bar applies to claims whose merits necessarily depend on proof that an attorney violated a professional obligation in the course of providing professional services.” (Foxen v. Carpenter (2016) 6 Cal.App.5th 284, 292.) “In this context, a ‘professional obligation’ is an obligation that an attorney has by virtue of being an attorney, such as fiduciary obligations . . . the obligations embodied in the State Bar Rules of Professional Conduct.” (Ibid.) The Duty to Communicate is “an integral part of competent professional performance as an attorney.” (Calvert v. State Bar (1991) 54 Cal.3d 765, 782.)

I.                Demurrer to the first cause of action for Breach of Contract – WITHOUT LEAVE TO AMEND.

            The essential elements of breach of contract are “(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." (D'Arrigo Bros. of California v. United Farmworkers of America (2014) 224 Cal.App.4th 790, 800.)          

            Lisitsa argues the CCP § 340.6(a) one-year statute of limitations applies to the breach of contract claim because the claim arises out of an alleged breach of an attorney’s duty to communicate. (See Motion, pp. 11–13.)  The Court agrees. The FAC states, “LISITSA breached her contractual obligation to keep GILERMAN informed of her case and to be able to make intelligent decisions concerning how to best proceed with her case.” (FAC, ¶ 24.) Plaintiff Erina Gilerman (“Gilerman”) essentially pleads that Lisitsa breached the contract by breaching the attorney’s professional duty to communicate during the course of providing Gilerman with professional services. The time bar for allegations of a breach of attorney’s professional duties including the duty to communicate, are governed by the one-year statute of limitations under CCP § 340.6(a).  Austin v. Medicis (2018) 21 Cal.App.5th 577, 587

            The underlying case was dismissed on 4-15-21, denied a motion for new trial on 6-24-21, with the decision affirmed on appeal on 3-20-23. The statute of limitations for actions against attorneys are not tolled by appeal and so the latest the limitations period can start running was on 4-1-21 when the initial adverse judgment occurred. (See Laird v. Blacker (1992) 2 Cal.4th 606, 618, as modified on denial of reh'g (July 16, 1992) [“Section 340.6 and its legislative history make clear that once a client has been injured by an adverse judgment, the limitations period commences and is not tolled by filing an appeal absent continuous representation by the trial attorney.”].)

            Additionally, “[F]or purposes of Code of Civil Procedure section 340.6, subdivision (a)(2) . . . the representation ends when the client actually has or reasonably should have no expectation that the attorney will provide further legal services.” (GoTek Energy, Inc. v. SoCal IP Law Group, LLP (2016) 3 Cal.App.5th 1240, 1247.) Gilerman filed for a substitution of attorney on 4-30-21consenting to new representation under Zhonette Reed, objectively ending Defendants representation of Gilerman. (See RJN, Ex. 5.)

            Based on the allegations of Gilerman’s FAC and the Court’s judicial notice of the date of the dismissal of the underlying case, Gilerman cannot allege any new facts that would overcome the the statute of limitations defense.  Therefore, Gilerman’s request for leave to amend is denied.

II.             Demurrer to the third cause of action for Fraud – SUSTAINED WITHOUT LEAVE TO AMEND.

            "A complaint for fraud must allege the following elements: (1) a knowingly false representation by the defendant; (2) an intent to deceive or induce reliance; (3) justifiable reliance by the plaintiff; and (4) resulting damages. Every element must be specifically pleaded. [citations omitted]" (Service by Medallion, Inc. v. Clorox Co. (1996) 44 Cal.App.4th 1807, 1816.)

            “[T]he elements of a cause of action for fraud based on concealment are: (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” (Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 310–311, citations omitted; see also CACI 1901)

            CCP §340.6 expressly excludes an action for “actual fraud” from the one-year statute of limitation.  Regardless, Lisitsa argues “The test for determining whether a cause of action falls within the statute of limitations contained in section 340.6(a) is “whether the claim, in order to succeed, necessarily depends on proof that an attorney violated a professional obligation as opposed to some generally applicable nonprofessional obligation.” (Lee v. Hanley (2015) 61 Cal.4th 1225, 1238.) Further, section 340.6(a) applies to any claims that meet this test, notwithstanding how they are styled. (Id. at p. 1239; see also Bergstein v. Stroock & Stroock & Lavan LLP (2015) 236 Cal.App.4th 793, 819 [“ ‘[w]hen determining which statute of limitations applies to a particular action, a court considers what the principal purpose or “gravamen” of the action is, rather than the form of action or the relief demanded.’ ”].)”  The Court agrees.  Again, as alleged, Gilerman’s claim for fraud is the Defendant’s failure to disclose to her the addition of Berhend in the second amended complaint, and the improper purpose for doing so, and the fact of Defendant’s prior representation of Berhend.  Although unartfully pleaded, the Court agrees that the allegations of the second cause of action labeled “fraud” allege a breach of Defendant’s professional duties of disclosure, not actual fraud.  As alleged, this claim, therefore, is barred by the one-year statue of limitation under Section 340.6.