Judge: Helen Zukin, Case: 21SMCV01179, Date: 2022-08-18 Tentative Ruling
Case Number: 21SMCV01179 Hearing Date: August 18, 2022 Dept: 207
Background
This action stems from remodeling work performed at the
residence owned by Plaintiffs Francine Fisher and Howard Fisher (collectively
“Plaintiffs”). Plaintiffs bring this action against Defendants Sterling West
and Sterling Landscaping, Inc. (collectively “Defendants”), as well as other
individuals and entities alleging various defects and deficiencies in the remodeling
of Plaintiffs’ backyard. Plaintiffs’ operative pleading is the First Amended
Complaint (“FAC”) filed on June 2, 2022, which alleges causes of action against
Defendants for (1) breach of written contract, (2) breach of oral contract, (3)
fraud, (4) negligence, (5) professional negligence, and (6) disgorgement under
Business and Professions Code § 7159.
Defendants bring this demurrer to the first, third, fourth,
and fifth causes of action asserted against them in the FAC, alleging they fail
to state sufficient facts to constitute a cause of action against them and are
uncertain under Code Civ. Proc. § 430.10(e)-(f). Defendants also move to strike
allegations in the FAC concerning Plaintiffs’ claim for punitive damages.
Demurrer Standard
When considering demurrers, courts read the allegations
liberally and in context. (Wilson v. Transit Authority of City of Sacramento
(1962) 199 Cal.App.2d 716, 720-21.) In a demurrer proceeding, the defects must
be apparent on the face of the pleading or via proper judicial notice. (Donabedian
v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) “A demurrer tests the
pleading alone, and not on the evidence or facts alleged.” (E-Fab, Inc. v.
Accountants, Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.) As such, the
court assumes the truth of the complaint’s properly pleaded or implied factual
allegations. (Id.) However, it does not accept as true deductions,
contentions, or conclusions of law or fact. (Stonehouse Homes LLC v. City of
Sierra Madre (2008) 167 Cal.App.4th 531, 538.)
A special demurrer for uncertainty under Section 430.10(f) is disfavored
and will only be sustained where the pleading is so unintelligible a defendant
cannot reasonably respond—i.e., cannot reasonably determine what issues must be
admitted or denied, or what counts or claims are directed against him/her. (Khoury
v. Maly’s of Calif., Inc. (1993) 14 Cal.App.4th 612, 616.) Moreover, even
if the pleading is somewhat vague, “ambiguities can be clarified under modern
discovery procedures.” (Id.)
Motion to Strike Standard
The court may, upon a motion,
or at any time in its discretion, and upon terms it deems proper, strike any
irrelevant, false, or improper matter inserted in any pleading. (Code Civ.
Proc., § 436(a).) The court may also strike all or any part of any pleading not
drawn or filed in conformity with the laws of this state, a court rule, or an
order of the court. (Id., § 436(b).)
The grounds for a motion to strike are: the pleading has irrelevant, false, or
improper matter, or has not been drawn or filed in conformity with laws. (Id. § 436.) The grounds for moving to
strike must appear on the face of the pleading or by way of judicial notice. (Id. § 437.)
Analysis
1. Meet and
Confer Requirement
Before filing a
demurrer or a motion to strike, the demurring or moving party is required to
“meet and confer in person or by telephone” with the party who filed the
pleading demurred to or the pleading subject to the motion to strike for the
purposes of determining whether an agreement can be reached through a filing of
an amended pleading to resolve the objections to be raised in the demurrer.
(C.C.P. §§ 430.41 and 435.5.) Under
Code Civ. Proc. § 430.41(a)(3) the demurring party is required to file and
serve a declaration with the demurrer attesting to the “means by which the
demurring party met and conferred with the party who filed the pleading subject
to demurrer, and that the parties did not reach an agreement resolving the
objections raised in the demurrer” or a statement “[t]hat the party who filed
the pleading subject to demurrer failed to respond to the meet and confer
request of the demurring party.” Code Civ. Proc. § 435.5(a)(3) imposes the same
requirement on a party bringing a motion to strike. Defendants have satisfied
these requirements. (An Decls. at ¶5.)
2. Code of
Civil Procedure section 430.41(b)
Plaintiffs claim Defendants
demurrer is barred by Code Civ. Proc. § 430.41(b), claiming this code section
“provides that a party shall not demurrer to any portion of the amended complaint
on grounds that could have been raised by demurrer to the earlier version of
the complaint.” (Opposition at 3.) Plaintiffs’ argument ignores critical
language in the statute. Section 430.41(b) is expressly made contingent on the
demurring party having successfully demurred to the prior version of the
complaint: “A party demurring to a pleading that has been amended after a
demurrer to an earlier version of the pleading was sustained shall not
demur to any portion of the amended complaint, cross-complaint, or answer on
grounds that could have been raised by demurrer to the earlier version of the
complaint, cross-complaint, or answer.” (Emphasis added.) Here, no demurrer was
brought or sustained as to Plaintiff’s original Complaint. Accordingly, by its
own terms Code Civ. Proc. § 430.41(b) does not apply to Defendants’ demurrer to
the FAC.
3. Defendants’
Notice of Demurrer
Plaintiffs also ask the Court to
reject Defendants’ demurrer due to typographical errors in Defendants’ notice.
For example, Plaintiffs complain that Defendants’ notice references the “second
cause of action for Fraud or Deceit” while the actual second cause of action in
the FAC is for breach of contract and Plaintiffs’ fraud cause of action is
actually the third cause of action asserted in the FAC. (Opposition at 5.) Plaintiffs’
claim that the Defendants’ demurrer fails to give proper notice of the claims
and defects of each cause of action is unpersuasive as the content of
Defendant’s demurrer, which is attached to the notice, makes it clear
Defendants are attacking Plaintiffs’ claim of fraud. Further, it appears the
typographical error in Defendants’ notice stems from Plaintiffs’ own
typographical error in the caption of the FAC, which lists the second cause of
action as fraud and the third cause of action as negligence. Plaintiffs dismiss
their own error as “not substantive.” (Opposition at 6.) The Court agrees the
error is not substantive, whether made by Plaintiffs or Defendants.
Accordingly, the Court disregards Plaintiffs’ arguments for rejection of
Defendants’ demurrer on this basis.
For the sake of clarity, the Court
will discuss the causes of action based on their appearance in the body of the
FAC and will ignore Plaintiffs’ defective caption to the FAC.
4. First
Cause of Action – Breach of Contract
To state a cause of action for
breach of contract, Plaintiff must be able to establish “(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.” (Oasis
West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.)
As Defendants assert, if a breach
of contract claim “is based on alleged breach of a written contract, the terms
must be set out verbatim in the body of the complaint or a copy of the written
agreement must be attached and incorporated by reference.” (Harris v. Rudin,
Richman & Appel (1999) 74 Cal.App.4th 299, 307.) Defendants correctly
point out the FAC does not attach a copy of the purported written contract or
set forth its verbatim terms. Plaintiffs offer no response to this argument,
and instead assert the FAC properly alleges every element of a cause of action
for breach of contract. However, a pleading must do more than simply recite the
elements of a cause of action, Plaintiffs must allege facts showing those
elements are satisfied. The FAC here does not allege such facts.
For example, the FAC merely states
“Defendants have breached their obligations under [the] agreement” in a
conclusory fashion without stating any facts establishing what Defendants’
obligations were under the agreement. (FAC at ¶60.) Similarly, the FAC states
“Plaintiff has incurred general and special damages” without asserting facts
showing Plaintiffs were damaged by Defendants’ alleged breaches. (Id. at
¶62.) It is also unclear whether the first cause of action is being brought by
both Plaintiffs. The FAC refers to Plaintiff Francine Fisher individually as
“Francine” and Plaintiff Howard Fisher individuals as “Howard” and both
collectively as “Plaintiffs.” Yet paragraphs 56 through 62 refer only to a
singular “Plaintiff” without identifying which of the two Plaintiffs is being
referred to. (See, e.g., FAC at ¶58 [“Plaintiff and Defendants entered into a
written ‘service agreement’…”]; FAC at ¶59 [“Plaintiff performed all
conditions…”].)
The Court finds the first cause of
action in the FAC fails to state facts sufficient to constitute a cause of
action against Defendants and accordingly Defendant’s demurrer to this cause of
action is SUSTAINED. Plaintiffs will be given leave to amend to plead additional
facts and either attach a copy of the subject written agreement or state its
verbatim terms.
5. Third
Cause of Action – Fraud
“The elements of fraud are (a) a misrepresentation (false
representation, concealment, or nondisclosure); (b) scienter or knowledge of
its falsity; (c) intent to induce reliance; (d) justifiable reliance; and (e)
resulting damage.” (Hinesley v. Oakshade
Town Ctr. (2005) 135 Cal.App.4th 289, 294.) The facts constituting the
alleged fraud must be alleged factually and specifically as to every element of
fraud, as the policy of “liberal construction” of the pleadings will not
ordinarily be invoked. (Lazar v. Superior
Court (1996) 12 Cal.4th 631, 645.) To properly allege fraud against a corporation, the plaintiffs
must plead the names of the persons allegedly making the false representations,
their authority to speak, to whom they spoke, what they said or wrote, and when
it was said or written. (Tarmann v. State
Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 157.)
Defendants argue Plaintiffs’ fraud
claim is not pled with the requisite level of specificity. The Court agrees.
Plaintiffs’ cause of action for fraud is contained in paragraphs 74-82 of the
FAC. Those paragraphs do not identify any specific statement which is alleged
to form the basis of Plaintiffs’ fraud claim. Rather, the FAC refers generally
to all the allegations contained therein and asserts “At the time that
Sterling/Sterling-L, Karri and Derian made the statement and took the actions
as set forth herein, they knew that said statements were not true, and were in
fact were [sic] false, and they took such actions with the intent to deceive
Plaintiff.” (FAC at ¶76.) Again, these are merely conclusory recitations of the
elements of a fraud claim, not factual allegations showing those elements have
been satisfied here.
Further, a review of the FAC
reveals only two statements pled with any level of specificity. Paragraph 25 of
the FAC states:
When
Plaintiff suggested to Sterling that he should consider other lighting systems,
Sterling extolled the virtues of the Luxor system, including it’s [sic] flexibility
and longevity, and that it was the best system to meet Plaintiff’s needs, all
the while he know [sic] it was not an appropriate system, and it greatly exceeded
the Plaintiff’s requirements, and he concealed same from Plaintiff.
Paragraph 48 of the SAC alleges:
Karri/Sterling
represented that the decking material would retain a ‘well maintained’ look
with proper maintenance - which they said meant once a year the deck needed to
[be] cleaned and ‘re-oiled’, at a cost of approximately $800+ per treatment. We
have employed Karri’s recommended person to maintain the deck. Karri/Sterling
knew that their statement was false that the deck would require re-finishing
more than once a year at the time the statement was made. It turns out that the
deck requires cleaning/refinishing two to three times a year to maintain the
maintained look, not once a year, hence requiring at least $1,600+ a year, plus
the loss of the use of the deck for a week-a-year, for the life of the deck,
which is at least 20 years.
Neither paragraph is sufficient to
state a cause of action for fraud against Defendants. Paragraph 25 does not
identify which Plaintiff Defendant Sterling West is alleged to have spoken to,
or when or where this conversation took place. The same is true of Paragraph
48, which also fails to identify which individual is alleged to have made the
statement in question and instead attributes the statement to both Defendant Sterling
West and Defendant Karry McCoy.
Further, as with Plaintiffs’ claim
for breach of contract discussed above, the fraud cause of action in the FAC
refers only to a singular, unidentified “Plaintiff” and as such it is unclear
whether the cause of action is being asserted by both Plaintiffs.
Accordingly, the Court SUSTAINS
Defendants’ demurrer to Plaintiffs’ cause of action for fraud with leave to
amend.
6. Fourth and
Fifth Causes of Action – Negligence & Professional Negligence
Defendants argue the fourth and
fifth causes of action are duplicative as a claim for general negligence and
professional negligence are the same and “only a single cause of action for
Negligence should survive the FAC.” The Court disagrees. Plaintiffs’ fourth
cause of action for negligence alleges Defendants “were negligent in selecting
the contract/subcontractor and/or employees who worked on the Project.” (FAC at
¶86.) Plaintiffs’ fifth cause of action for professional negligence alleges
Defendants “failed to properly design the Plaintiff’s project, in that they
selected sub-part materials, materials that were not appropriate for the
project, and failed to design the hardscape, saying that we would do it as the
project evolved. However, Sterling/Sterling-L had expended little time at the
project, and failed to properly over see [sic] the project, resulting in many
aspects of the project not being properly designed.” (Id. at ¶94.)
Negligent hiring and supervision is a claim of negligence which is separate and
distinct from negligent design. Accordingly, the Court finds the two causes of
action assert different claims of negligence and are thus not duplicative.
Defendants do not cite to any authority which requires a plaintiff to assert
all bases or theories of negligence collectively in a single cause of action
and the Court is unaware of any such authority.
The Court finds Plaintiffs
properly asserted different claims of negligence as separate causes of action.
Defendants further claim these
causes of action “are also uncertain.” (Demurrer at 8.) However, Defendants do
not offer any argument or elaboration as to how these causes of action are
uncertain. The Court does not find these causes of action to be uncertain and
accordingly Defendants’ demurrer to these causes of action is OVERRULED.
7. Motion to
Strike Allegations Concerning Punitive Damages
Defendants also move to strike
allegations in the FAC concerning punitive damages. Plaintiffs’ claim for
punitive damages is dependent on its cause of action for fraud. As the Court
has sustained Defendants’ demurrer to Plaintiffs’ cause of action for fraud
with leave to amend, the same result follows with respect to Defendants’ motion
to strike. Accordingly, Defendants’ motion to strike is GRANTED with leave to
amend.
Conclusion
Defendants’ demurrer to the first cause of action for breach
of contract and third cause of action for fraud is SUSTAINED with 30 days’
leave to amend. Defendants’ demurrer to the fourth cause of action for
negligence and fifth cause of action for professional negligence is OVERRULED.
Defendants’ motion to strike allegations in the FAC concerning punitive damages
is GRANTED with 30 days’ leave to amend.