Judge: H. Jay Ford, III, Case: 24SMCV00435, Date: 2024-10-01 Tentative Ruling

Case Number: 24SMCV00435    Hearing Date: October 1, 2024    Dept: O

 Case Name:  FF CA Policy Parternship LP v. Estate of Olga Mellican, et al.

SUBJECT:                 DEMURRER WITH MOTION TO STRIKE

MOVING PARTY:   Defendants the Estate of Olga Mellican, by its Special Administrator, Ingrid Mellican; Ramona Mellican; Yasmin Gilleran; and Ingrid Mellican

RESP. PARTY:         Plaintiff FF CA Policy Partnership LP

TENTATIVE RULING

            Defendants Demurrer to the 1^st through 4^th causes of action for Declaratory Relief is OVERRULED. Plaintiff alleges the necessary facts to state claims for declaratory relief.

            Defendants Demurrer to the 5^th cause of action is SUSTAINED WITH 20 DAYS LEAVE TO AMEND. Plaintiff does not allege the harm Plaintiff incurred resulted from the alleged breach.

The Court notes that although this motion was filed as a Demurrer with Motion to Strike, no motion to strike was filed..

            Defendants RJN (filed 5-7-2024) No. 1 is DENIED. The Court will not take judicial notice of email correspondence without evidence those facts meet the elements CCP §452(h). Defendants RJN Nos 2 and 3 are GRANTED as to the existence of articles, court documents, and the administrative ruling documents, but not to the “truth of the hearsay statements in the documents” or the factual finding made in court orders. (In re Vicks (2013) 56 Cal.4th 274, 314.)  Defendants RJN filed on9-23-2024 with the reply is denied as untimely.

REASONING

I.                Demurrer to the 1^st –4^th causes of action for Declaratory Relief—OVERRULED

“To allege facts sufficient to state a cause of action for declaratory relief, the plaintiff must allege two essential elements: (1) a proper subject of declaratory relief, and (2) an actual controversy involving justiciable questions relating to the rights or obligations of a party.” Childhelp, Inc. v. City of Los Angeles (2023) 91 Cal.App.5th 224, 235, as modified (May 5, 2023), [internal citations omitted].) “The “actual controversy” language in Code of Civil Procedure section 1060 encompasses a probable future controversy relating to the legal rights and duties of the parties.” (Environmental Defense Project of Sierra County v. County of Sierra (2008) 158 Cal.App.4th 877, 885, as modified (Jan. 9, 2008).)

“An action for declaratory relief is authorized by Code of Civil Procedure section 1060, which provides in pertinent part: “Any person interested under a written instrument, ... 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.” (Doan v. State Farm General Ins. Co. (2011) 195 Cal.App.4th 1082, 1094–1095.)

Plaintiff FF CA Policy Partnership LP (“Plaintiff”) alleges the necessary facts to state a cause of action for declaratory relief in the 1^st–4^th causes of action.  In the 1^st –4^th causes of action for Declaratory Relief Plaintiff alleges a proper subject of declaratory relief based on the interpretation of policy agreements between Plaintiff and Defendant. (Compl., ¶¶47–115.)

In the 1^st cause of action for Declaratory Relief – Policy Validity Plaintiff alleges “[t]here exists an actual, justiciable, and substantial controversy between the parties concerning the rights to the Policy’s Death Benefit—i.e., whether Plaintiff is entitled to retain the Policy’s Death Benefit, or whether Defendant Estate is entitled to “recover” some or all of the Policy’s Death Benefit.” (Compl., ¶ 118.) Plaintiff alleges the policy is covered under California Law, the policy insured the life of a California Resident, and the policy is valid. (Compl., ¶¶ 119–122.) Plaintiff alleges an actual controversy by stating that Defendants made their position clear in a separate Delaware Action that that the Policy is invalid under Delaware Law, and Plaintiff alleges Defendants Policy theory being under Delaware Law is wrong. (Id., ¶¶ 126–129.) Plaintiff alleges they are entitled to a judgment from the Court declaring the rights among Plaintiff and Defendant, that Plaintiff is the rightful owner of the Policy’s Death Benefit, and that Defendant is “barred from recovering any portion of the Policy’s Death Benefit from Plaintiff.” (Id., ¶¶ 139–141.) Plaintiff has successfully plead a cause of action for declaratory relief – policy validity.

In the 2^nd cause of action for Declaratory Relief – Lack of Standing Plaintiff alleges “[t]here exists an actual, justiciable, and substantial controversy between the parties concerning whether Defendant Estate has standing to challenge the Mellican Policy’s validity for lack of insurable interest.” (Compl., ¶ 144.) Plaintiff alleges an actual controversy because Defendant “made clear its position that it has standing to challenge the Mellican Policy as void ab initio for lack of insurable interest,” however Plaintiff alleges “its position is that Defendant Estate lacks standing to challenge the validity of the Mellican Policy.” (Id., ¶¶ 146–147.) Plaintiff requests judgment from the Court “declaring that Defendant Estate lacks standing to challenge the Mellican Policy’s validity for lack of insurable interest.” (Id., ¶ 148.) Plaintiff has successfully plead a cause of action for declaratory relief – lack of standing.

In the 3^rd cause of action for Declaratory Relief–statute of limitations Plaintiff alleges there “exists an actual, justiciable, and substantial controversy between the parties concerning whether any claims by Defendant Estate to “recover” the Policy’s Death Benefit under the Delaware Insurable Interest Law are time barred under either California or Delaware’s one-year statute of limitations for penalties and forfeitures.” (Compl., ¶ 151.) Plaintiff further alleges an actual controversy by stating Plaintiff disagrees with Defendants position that the claims are not time barred. (Id., ¶¶ 153–161.) Plaintiff requests a judgment from the Court “declaring that any claims by Defendant Estate to “recover” the Policy’s Death Benefit under a lawsuit brought under the Delaware Insurable Interest Law are time barred under either California or Delaware’s one-year statute of limitations for penalties and forfeitures.” (Id., ¶ 162.) Plaintiff has successfully plead a cause of action for declaratory relief – statute of limitations.

In the 4^th cause of action for Declaratory Relief- Waiver Plaintiff alleges there “exists an actual, justiciable, and substantial controversy between the parties concerning whether, to the extent Delaware law applies, Defendant Estate has waived its claim to “recover” the Policy’s Death Benefit.” (Compl., ¶ 165.) Plaintiff further alleges that Plaintiff’s position is that Defendants “waived any and all claims to “recover” the Policy’s Death Benefit when the Mellican Family sold the beneficial interest in the Mellican Trust in 2007,” however Defendant’s position is that is claims have not been waived. (Id., ¶¶ 167–177.) Plaintiff requests judgment from the Court “declaring that, to the extent Delaware law applies, Defendant Estate, Ingrid Mellican, Ramona Mellican (a/k/a Ramona Schneider), and Yasmin Gilleran have waived any claim to recover the Policy’s Death Benefit.” (Id., ¶ 178.) Plaintiff has successfully plead a cause of action for declaratory relief –waiver.

Thus, Defendants demurrer to the 1^st through 4^th causes of action are OVERRULED.

II.             Demurrer to 5^th cause of action for Breach of Contract—SUSTAINED WITH 20 DAYS 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.)

Plaintiff alleges the cause of action as to Defendant Ingrid Mellican (“Ingrid”) alone. Plaintiff alleges there exists a “valid and binding sale contracts (i.e., the Successor Beneficiary Agreement and related agreements),” in which Defendant “Ingrid Mellican consented to the sale of the Policy to Ocean Gate and waived any right to challenge its validity or claim the Policy’s Death Benefit.” (Compl., ¶ 180; see also, id., ¶¶ 63, 65–68) Plaintiff does not attach the agreements which they are alleging were breached, but they do set out some “actual terms of the contract.” (See id., ¶¶ 63–67; Gautier v. General Tel. Co. (1965) 234 Cal.App.2d 302, 305 [the “law nonetheless requires that there be an allegation of such verbal agreement by setting forth the substance of its relative terms.”].)

Plaintiff alleges Plaintiff has “satisfied all obligations under any agreements relating to the Mellican family’s sale of the Policy or the beneficial interest in the Trust that owned the Policy.” (Id., ¶ 181.) Plaintiff alleges that Ingrid “breached the sale contracts by “seeking to be appointed as Special Administrator for Defendant Estate in order to file a lawsuit to “recover” proceeds under life insurance policies that had insured Olga Mellican’s life and by filing the Delaware Action challenging the validity of the Policy and claiming the Policy’s Death Benefit.” (Id., ¶ 182.)

Plaintiff alleges they were harmed by the breach, but they do not specifically state any how they were harmed. (Compl., ¶ 183; See Comstock v. Coronet Heating Supply Co. (1952) 111 Cal.App.2d 600, 603 [“Where . . . damages do not necessarily result from the wrongful breach of a contract, an injured party must specifically plead the facts showing the damage which has resulted to him because of the wrongful act.”].) Plaintiff fails to allege how the clamed damages were caused by the breach of the contract. (Compl., ¶ 184.)