Judge: John J. Kralik, Case: 24BBCV00450, Date: 2024-06-28 Tentative Ruling
Case Number: 24BBCV00450 Hearing Date: June 28, 2024 Dept: NCB
North
Central District
|
Alltime
maintenance inc., Plaintiff, v. bold partners, llc, et al., Defendants. |
Case
No.: 24BBCV00450 Hearing Date: June 28, 2024 [TENTATIVE]
order RE: demurrer |
BACKGROUND
A.
Allegations
Plaintiff Alltime Maintenance, Inc.
(“Plaintiff”) alleges that Defendant Lauren 5807 LP (“Laurel”) is the owner of
the real property located at 5807 Laurel Canyon Boulevard, Valley Village, CA
91607 and that Defendant Bold Partners, LLC (“BPL”) was created by Laurel for the
sole purpose of owning the property.
Plaintiff is alleged to be a licensed contracting company.
Plaintiff alleges that in September 2022,
Meghan Hayner and Michael Strevel on behalf of BPL requested that Plaintiff
provide a bid to work on the property.
Plaintiff alleges in November 2022, Plaintiff entered into a Contractor
Agreement with Laurel at the request of BPL.
Plaintiff alleges that communications concerning the contract and all
subsequent change orders and requests on behalf of Laurel were undertaken by
agents on behalf of BPL for BPL and Laurel’s benefit. Plaintiff alleges that it performed all the
work requested, provided materials and equipment, and completed the work on
behalf of Laurel and BPL, but Defendants failed to pay all monies due and owing
under the contract.
The complaint, filed on February 23, 2024,
alleges causes of action for: (1) breach of contract against Laurel; (2)
quantum meruit against Laurel and BPL; (3) common count – account stated
against Laurel and BPL; (4) common count – open book against Laurel and BPL;
and (5) to enforce mechanic’s lien against Laurel.
B.
Demurrer on Calendar
On May 8, 2024, Defendant BPL filed a
demurrer to the complaint.
On June 6, 2024, Plaintiff filed an
opposition brief.
On June 21, 2024, BPL filed a reply brief.
REQUEST
FOR JUDICIAL NOTICE
BPL requests judicial notice of
Exhibit 1, a copy of the Grant Deed recorded December 21, 2021. The request is granted.
DISCUSSION
BPL demurs to the 2nd, 3rd,
and 4th causes of action in the complaint. The Court notes that BPL does not specifically
address the quantum meruit and common count causes of action in the demurrer
papers but makes general arguments about the complaint. It is not until the reply brief that BPL
makes specific arguments about the causes of action at issue.
First, BPL argues that Plaintiff’s
allegations for alter ego is not sufficient.
Plaintiff must factually allege that there is “a unity of interest and
ownership between the corporation and its equitable owner that the separate
personalities of the corporation and the shareholder do not in reality exist.
Second, there must be an inequitable result if the acts in question are treated
as those of the corporation alone.” (Sonora
Diamond Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 526.) Bare
conclusory allegations that a corporation is an alter ego of an individual is
insufficient to justify the court in disregarding the corporate entity in the
absence of allegations of facts from which it appears that justice cannot
otherwise be accomplished. (Vasey v. Cal. Dance Co. (1977) 70
Cal.App.3d 742, 749.) To succeed on a
cause of action to disregard the corporate form, the plaintiff must “…plead and
prove such a unity of interest and ownership that the separate personalities of
the corporation and the individuals do not exist, and that an inequity will
result if the corporate entity is treated as the sole actor.” (Id.) While the plaintiff may not have alleged
specific facts to support an alter ego theory, the plaintiff is only required
to allege “ultimate rather than evidentiary facts.” (Rutherford
Holdings, LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 235-36 [finding
sufficient to withstand a demurrer, allegations stating that “… Caswell
dominated and controlled PDR; that a unity of interest and ownership existed
between Caswell and PDR; that PDR was a mere shell and conduit for Caswell's
affairs; that PDR was inadequately capitalized; that PDR failed to abide by the
formalities of corporate existence; that Caswell used PDR assets as her own;
and that recognizing the separate existence of PDR would promote injustice.”].)
Paragraph 6 of the complaint alleges: “Alltime is informed and believes and thereon alleges that Bold and
Laurel are the alter ego’s[sic] of each other, and at all times since their
formation, a unity of interest and ownership has existed such that any
separateness between Bold and Laurel ceased to exist and that Bold, and its
principals, have controlled, dominated, managed and operated Laurel to
its/their[sic] own benefit.” (Compl.,
¶6.) The complaint does not sufficiently
allege facts regarding whether there would be an inequitable result if the acts
in questions were treated as those of one corporation alone. The demurrer to the complaint will be
sustained so that Plaintiff may allege further facts regarding alter ego
liability.
Second, BPL argues that it is not a
party to the contract and is not the owner to the property, such that
Plaintiff’s complaint fails as alleged against BPL. While the complaint alleges that Laurel
entered into the contract with Plaintiff, Plaintiff also alleges that all
actions were undertaken at the direction of BPL and for the benefit of BPL and
Laurel. (See Compl., ¶¶11-13.) BPL does not direct the demurrer to the 1st
cause of action for breach of contract, but only for the 2nd to 4th
causes of action.
“A quantum
meruit or quasi-contractual recovery rests upon the equitable theory that a
contract to pay for services rendered is implied by law for reasons of justice. [Citation.] However, it is well settled that
there is no equitable basis for an implied-in-law promise to pay reasonable
value when the parties have an actual agreement covering compensation.” (Hedging Concepts, Inc. v. First
Alliance Mortgage Co. (1996) 41 Cal.App.4th 1410, 1419.) “To recover on a claim for the reasonable
value of services under a quantum meruit theory, a plaintiff must establish
both that he or she was acting pursuant to either an express or implied request
for services from the defendant and that the services rendered were intended to
and did benefit the defendant. (Ochs v. PacifiCare of
California (2004) 115 Cal.App.4th 782, 794.) Here, the complaint does not allege that Plaintiff and BPL explicitly
have a contract and Exhibit A to the complaint also shows that the Contractor
Agreement was entered between Plaintiff and Laurel. The complaint also alleges that the work was
performed for the benefit of both Laurel and BPL and that Defendants failed to
pay for the reasonable value of labor, equipment, and materials. (Compl., ¶¶13, 16, 29), but this is
contradicted by the Agreement itself. The demurrer is sustained as to the 2nd
cause of action with leave to amend.
An account
stated is an agreement, based on prior transactions between the parties, that
the items of an account are true and that the balance struck is due and owing. (Professional Collection
Consultants v. Lujan (2018) 23
Cal.App.5th 685, 691.) When an
account stated is assented to, either expressly or impliedly, it becomes a new
contract. (Id.) An account
stated claim is not based on the parties’ original transactions, but on the new
contract under which the parties have agreed to the balance due. (Id.)
In the 3rd cause of action, Plaintiff alleges that an account
was written between Plaintiff and Defendants, such that Defendants were
indebted to Plaintiff in connection with work, material, and equipment. (Compl., ¶32.) However, supporting facts
regarding the nature of the written indebtedness and whether this constituted a
new contract for the balance due has not been alleged. The contract is an integrated contract and
there is no evidence of an amendment that would add BPL as a party. The
demurrer to the 3rd cause of action is sustained with leave to
amend.
A “book account” is “a detailed statement which constitutes the
principal record of one or more transactions between a debtor and a creditor
arising out of a contract or some fiduciary relation, and shows the debits and
credits in connection therewith ....” (Professional Collection Consultants v. Lujan (2018) 23 Cal.App.5th 685, 690–691.) “The creditor
must keep these records in the regular course of its business and ‘in a
reasonably permanent form,’ such as a book or card file. (Code Civ. Proc., §
337a.) ‘A book account is “open” where a balance remains due on the
account.’” (Id. at 691.) The elements of a cause of
action in common count includes: (1) the statement of indebtedness in a certain
sum; (2) the consideration, i.e., goods sold, work done, money loaned; and (3) nonpayment. (Allen
v. Powell (1967) 248 Cal.App.2d 502, 510.)
In the 4th cause of action, Plaintiff alleges that Defendants
became indebted to Plaintiff on an open book account in the last year. (Compl., ¶35.) The allegations are general and do not state
any facts supporting an open book account cause of action. The demurrer to the 4th cause of
action is sustained with leave to amend.
CONCLUSION
AND ORDER
Defendant Bold
Partners, LLC’s demurrer to the complaint is sustained with 20 days leave to
amend.
Defendant shall give notice of
this order.
DATED: June 28,
2024 ___________________________
John
Kralik
Judge
of the Superior Court