Judge: Joseph Lipner, Case: 20STCV03048, Date: 2023-09-14 Tentative Ruling
Case Number: 20STCV03048 Hearing Date: April 4, 2024 Dept: 72
SUPERIOR COURT OF CALIFORNIA
COUNTY OF LOS ANGELES
DEPARTMENT 72
TENTATIVE
RULING
|
SUSIE SENIURA, Plaintiff, v. BENJAMIN M. LANG, Defendant. |
Case No:
20STCV03048 Hearing Date: April 4, 2024 Calendar Number: 1 |
Plaintiff and Cross-Defendant Susie Seniura (“Plaintiff”),
as Trustee of the Ngook Quen Lang Trust (the “NQL Trust”) and as Personal
Representative of the Estate of Ngook Quen Lang (the “Estate”), and
Cross-Defendant Eugene Seniura (“Eugene”) (collectively, “Cross-Defendants”)
demurs to and move to strike portions of the Second Amended Cross-Complaint
(“SACC”) filed by Defendant and Cross-Complainant Tammy P. Lang-Tanaka
(“Defendant”) as Successor Trustee of the Benjamin M. Lang Trust of 2017 dated
May 18, 2017 (the “BML Trust”). Defendant separately moves for leave to amend
the SACC.
The Court OVERRULES the demurrer.
The Court DENIES the motion to strike.
The Court Grants Defendant’s leave to amend. Defendant shall file the amended
cross-complaint within 10 days.
Plaintiff filed this action on January 24, 2020, seeking
Partition by Sale of Real Property.
On May 12, 2023, Defendant filed a cross-complaint.
On October 10, 2023, the Court issued an order granting in
part and denying without prejudice in part Defendant’s motion to amend the
cross-complaint.
On October 16, 2023, Defendant filed the SACC, the operative
cross-complaint, against Cross-Defendants, raising claims for (1) conversion;
(2) unjust enrichment; (3) accounting; (4) theft in violation of Penal Code,
section 484; (5) theft in violation of Penal Code, section 496, subd. (a); (6)
receipt of stolen property in violation of Penal Code, section 496, subd. (a);
(7) breach of trust (failure to maintain accurate trust records); (8) breach of
trust (failure to provide accurate accounting); (9) breach of trust
(commingling of assets); (10) breach of trust (dissipation of trust estate
assets); (11) breach of trust (embezzlement in violation of Penal Code, section
338); (12) breach of trust (failure to maintain insurance); (13) theft by fraud
in violation of Penal Code, section 484; and (14) unjust enrichment.
On November 15, 2023, Cross-Defendants filed the demurrer
and motion to strike against the SACC. Defendant filed an opposition and
Cross-Defendants filed a reply.
Defendant moved for leave to amend the SACC on December 26,
2023. Cross-Defendants filed an opposition and Defendant filed a reply.
On March 14, 2024, the Court held a hearing for the motions.
The Court continued the hearing and ordered the parties to filed supplemental
briefs.
As a general matter, 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 the evidence or facts alleged.” (E-Fab, Inc. v. Accountants,
Inc. Servs. (2007) 153 Cal.App.4th 1308, 1315.) The court assumes the truth
of the complaint’s properly pleaded or implied factual allegations. (Ibid.) The only issue a demurrer is
concerned with is whether the complaint, as it stands, states a cause of
action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.)
Where a demurrer is sustained, leave to amend must be
allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335,
348.) The burden is on the plaintiff to show the court that a pleading can be
amended successfully. (Ibid.;
Lewis v. YouTube, LLC (2015) 244 Cal.App.4th 118, 226.) However, “[i]f
there is any reasonable possibility that the plaintiff can state a good cause
of action, it is error to sustain a demurrer without leave to amend.” (Youngman v. Nevada Irrigation Dist.
(1969) 70 Cal.2d 240, 245).
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.
(Code Civ. Proc., § 436(b).) The grounds for a motion to strike are that the
pleading has irrelevant, false or improper matter, or has not been drawn or
filed in conformity with laws. (Code Civ. Proc., § 436.) The grounds for moving
to strike must appear on the face of the pleading or by way of judicial notice.
(Code Civ. Proc., § 437.)
A complainant may obtain leave from the trial court to amend
their pleading beyond the number of amendments allowed under Code of Civil
Procedure section 472 (a) by filing a noticed motion. (Cal. Rules of Court,
Rule 3.1324.) The motion must be accompanied by a declaration stating: (1) the
effect of the amendment; (2) why the amendment is necessary and proper; (3)
when the facts giving rise to the amended allegations were discovered; and (4)
why the request was not made earlier.¿(Cal. Rules of Court, Rule 3.1324 (b).)
“Any judge, at any time before or after commencement of
trial, in the furtherance of justice, and upon such terms as may be proper, may
allow the amendment of any pleading or pretrial conference order.”¿(Code Civ.
Proc., § 576.) In the absence of a showing of prejudice from the opposing side,
the trial court ordinarily lacks discretion to deny a motion to amend a
pleading. (Honig v. Financial Corp. of America (1992) 6 Cal.App.4th 960,
965.)
The Court grants Cross-Defendants’ request for judicial
notice.
Subject Matter Jurisdiction
Cross-Defendants argue that the 7th through 12th causes of
action all concern the internal affairs of a trust and therefore fall under the
exclusive jurisdiction of the probate court.
“The superior court having jurisdiction over the trust
pursuant to this part has exclusive jurisdiction of proceedings concerning the
internal affairs of trusts.” (Probate Code, § 17000, subd. (a).)
The NQL Trust is currently being administered in Orange
County, California (SACC ¶¶ 2-3.) Cross-Defendants argue that the Orange County
Superior Court therefore has exclusive jurisdiction over proceedings concerning
the internal affairs of the NQL Trust pursuant to § 17000.
“Use of the term “exclusive jurisdiction” in these contexts
is somewhat misleading. The term does not refer to jurisdiction in the
‘fundamental,’ ‘in personam’ or ‘in rem’ sense. Rather, it concerns assigning
exclusive responsibility over certain actions to the department of the superior
court assigned to hear probate matters as against other departments in that
same county superior court, such as the departments that hear civil matters.
‘Exclusive jurisdiction’ in the Probate Code does not distinguish between
different county superior courts.” (Capra v. Capra (2020) 58 Cal.App.5th
1072, 1083.)
“[E]ven in a county having a formal probate department, a
nonprobate department does not lack fundamental jurisdiction over a probate
matter. Instead, and as that court held in [citation], the probate department
has ‘primary’ jurisdiction and a nonprobate department ‘secondary’ jurisdiction
of probate-related proceedings.” (Harnedy v. Whitty (2003) 110
Cal.App.4th 1333, 1344 [citations omitted].) “Probate Code sections 17000 and
17001 did not change this state of affairs. Those statutes were enacted (in
original form in 1986) to make clear that the probate departments of the
California superior courts could exercise the full and complete jurisdiction of
a regular superior court when hearing and deciding a probate matter.” (Id.
at p. 1345.)
This Court is therefore not divested of jurisdiction by section
17000.
The Court therefore does not sustain the demurrer on this
basis.
Personal Jurisdiction
Cross-Defendants argue that the Court does not have personal
jurisdiction over the NQL Trust because the Trustor of the NQL Trust was a
resident of Orange County at the time of her death and the trust is being
administered in Orange County.
“[A] party who seeks relief on any basis other than a motion
to quash for lack of personal jurisdiction will be deemed to have made a
general appearance and waived all objections to defects in service, process, or
personal jurisdiction.” (Dial 800 v. Fesbinder (2004) 118 Cal. App. 4th
32, 52.)
Cross-Defendants have appeared in order to move to strike
portions of the SACC for lack of standing and to demur to the SACC for lack of
subject matter jurisdiction. They have therefore consented to personal
jurisdiction.
Furthermore, “[a] party against whom a cause of action has
been asserted in a complaint or cross-complaint may file a cross-complaint
setting forth either or both of the following: (a) Any cause of action he has
against any of the parties who filed the complaint or cross-complaint against
him …. (b) Any cause of action he has against a person … whether or not such
person is already a party to the action, if the cause of action asserted in his
cross-complaint (1) arises out of the same transaction, occurrence, or series
of transactions or occurrences as the cause brought against him or (2) asserts
a claim, right, or interest in the property or controversy which is the subject
of the cause brought against him.” (Code Civ. Proc., § 428.10.)
Defendant’s cross-claims are thus explicitly permitted by
statute as a result of Plaintiff’s complaint in this action.
The Court therefore does not sustain the demurrer on this
basis.
Cross-Defendants argue that Defendant does not have standing
to sue for violations of the Penal Code and that the Court must therefore
dismiss the following cross-claims: (4) theft in violation of Penal Code,
section 484; (5) theft in violation of Penal Code, section 496, subd. (a); (6)
receipt of stolen property in violation of Penal Code, section 496, subd. (a);
(11) breach of trust (embezzlement in violation of Penal Code, section 338); and
(13) theft by fraud in violation of Penal Code, section 484.
Defendant responds that Penal Code, section 496 provides
that “Any person who has been injured by a violation of subdivision (a) or (b)
may bring an action for three times the amount of actual damages, if any,
sustained by the plaintiff, costs of suit, and reasonable attorney's fees.”
(Penal Code, § 496, subd. (c).)
Thus, Defendant’s fifth and sixth causes of action for
violation of section 496 are facially authorized by section 496(c).
Section 496(a) generally incorporates any form of theft or
extortion in its ambit. (Penal Code, § 496, subd. (a) [“Every person who buys
or receives any property that has been stolen or that has been obtained in any
manner constituting theft or extortion knowing the property to be so stolen or
obtained, or who conceals, sells, withholds, or aids in concealing, selling, or
withholding any property from the owner, knowing the property to be so stolen
or obtained, shall be punished …”].)
The California Supreme Court has stated that the meaning of
“theft” sections 496(c) and 496(a) must be read together with section 484. (Siry
Investment, L.P. v. Farkhondehpour (2022) 13 Cal.5th 333, 361.) Thus, a
violation of section 484 also violates 496(a), thereby triggering the private
right of action under 496(c). The fourth and thirteenth cross-claims are
therefore proper.
Defendant
contends that, although the eleventh cause of action states the incorrect Penal
Code section, it correctly alleges embezzlement under Penal Code sections 503,
506, and 484. The Court agrees.
(Defendant shall state the correct Penal Code sections in the amended
cross-claims.)
Sections
503 and 506 criminalize as embezzlement the fraudulent appropriation of
property by a person to whom it has been entrusted. Section 484 similarly
criminalizes as theft the fraudulent appropriation of property which has been
entrusted to a defendant. Thus, embezzlement is a category of theft under 484.
The eleventh cause of action therefore states a claim that is cognizable under
section 496(c) for the same reasons that section 484 violations can be alleged
under section 496(c).
The Court therefore overrules the demurrer with respect to
the fourth, fifth, sixth, eleventh, and thirteenth cross-claims.
Cross-Defendants argue that Defendant’s cross-claims under
the Penal Code must be stricken for the same reasons argued in the demurrer.
The Court has already disposed of these arguments above.
The Court therefore denies the motion to strike the fourth,
fifth, sixth, eleventh, and thirteenth cross-claims.
Punitive damages are appropriate when a defendant acted with
malice, oppression, or fraud. (Civ. Code, § 3294, subd. (a).) “Malice” is
defined as conduct intended to cause injury to a person or despicable conduct
carried on with a willful and conscious disregard for the rights or safety of
others. (Turman v. Turning Point of Cent.
Cal., Inc. (2010) 191 Cal.App.4th 53, 63.) “Oppression” means despicable
conduct subjecting a person to cruel and unjust hardship, in conscious
disregard of the person’s rights. (Ibid.)
“Fraud” is an intentional misrepresentation, deceit, or concealment of a
material fact known by defendant, with intent to deprive a person of property,
rights or otherwise cause injury. (Ibid.)
“In order to survive a motion to strike an allegation of
punitive damages, the ultimate facts showing an entitlement to such relief must
be pled by a plaintiff.” (Clauson v. Superior Court (1998) 67
Cal.App.4th 1253, 1255.) “In passing on the correctness of a ruling on a motion
to strike, judges read allegations of a pleading subject to a motion to strike
as a whole, all parts in their context, and assume their truth.” (Ibid.)
“In ruling on a motion to strike, courts do not read allegations in isolation.”
(Ibid.) Conclusory allegations, devoid of any factual assertions, are
insufficient to support a conclusion that parties acted with oppression, fraud
or malice. (Smith v. Superior Court
(1992) 10 Cal.App.4th 1033, 1042.)
Defendant argues that punitive damages are appropriate
because the eleventh and thirteenth cross-claims allege theft by fraud. Prior
to the first hearing, the Court tentatively planned to strike these allegations
because it expected to sustain the demurrer to those claims. However, because
the Court overrules the demurrer in light of Defendant’s supplemental briefing,
the Court also denies the motion to strike punitive damages.
Defendant has supplied declarations facially meeting the
statutory requirements for amendment.
Cross-Defendants argue that leave to amend must be denied
for the jurisdictional reasons asserted on demurrer. As discussed above, these
reasons do not deprive the Court of its ability to hear this case.