Judge: Joseph Lipner, Case: 22STCV40869, Date: 2023-09-21 Tentative Ruling

Case Number: 22STCV40869    Hearing Date: September 21, 2023    Dept: 72

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

            Defendant Robert Seng demurs to Plaintiff Bonsall Properties LLC’s complaint on the grounds that each cause of action fails to state a claim and is uncertain.

          The court sustains Defendant’s demurrer with leave to amend.  Plaintiff shall amend the complaint within 20 days. 

Background

          This action arises out of a real property dispute. Plaintiff Bonsall Properties LLC (“Plaintiff”) alleges that it entered into a written agreement (the “Purchase Agreement”) with Defendant Robert Seng, as Trustee of the Mary Lou Walbergh Qualified Personal Residence Trust (“Defendant”) regarding the purchase of real property located at 5838 Bonsall Dr., Malibu, CA 90265 (the “Property”). Plaintiff alleges that it made a deposit towards the purchase of the Property and that after execution of the Purchase Agreement, Plaintiff discovered numerous issues with the Property that would prohibit Plaintiff’s intended development plans for it. Plaintiff also alleges that the Purchase Agreement provided the Property would be vacant, but that Plaintiff recently discovered persons occupying the Property with Defendant’s knowledge and that they occupied the Property at the time of the original closing and there is no current binding agreement for them to vacate the Property.

          Plaintiff filed this action on December 29, 2022, alleging causes of action against Defendant for reformation of contract based on mistake and misrepresentation, and for specific performance. Defendant filed a cross-complaint on February 1, 2023, alleging causes of action against Plaintiff and Sonny Astani for breach of contract, quiet title, declaratory relief, and slander of title.

          On February 1, 2023, Defendant demurred to Plaintiff’s complaint, on the grounds that each cause of action fails to state a claim and is uncertain. On June 2, 2023, Plaintiff opposed the demurrer. On June 7, 2023, Defendant replied.

Legal Standard

A demurrer is a pleading used to test the legal sufficiency of other pleadings. It raises issues of law, not fact, regarding the form or content of the opposing party's pleading (complaint, answer or cross-complaint). (Code Civ. Pro., §§ 422.10, 589; see Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) It is not the function of the demurrer to challenge the truthfulness of the complaint; and for purposes of the ruling on the demurrer, all facts pleaded in the complaint are assumed to be true. (Donabedian, supra, 116 Cal.App.4th at p. 994.) 

A demurrer can be used only to challenge defects that appear on the face of the pleading under attack; or from matters outside the pleading that are judicially noticeable. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian, supra, 116 Cal.App.4th at p. 994.) No other extrinsic evidence can be considered. (Ion Equip. Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881 [error for court to consider facts asserted in memorandum supporting demurrer]; see also Afuso v. United States Fid. & Guar. Co. (1985) 169 Cal.App.3d 859, 862 [disapproved on other grounds in Moradi-Shalal v. Fireman’s Fund Ins. Cos. (1988) 46 Cal.3d 287] [error to consider contents of release not part of court record].) 

A demurrer can be utilized where the “face of the complaint” itself is incomplete or discloses some defense that would bar recovery. (Guardian North Bay, Inc. v. Super. Court (2001) 94 Cal.App.4th 963, 971-72.) The “face of the complaint” includes material contained in attached exhibits that are incorporated by reference into the complaint; or in a superseded complaint in the same action. (Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94; see also Barnett v. Fireman’s Fund Ins. Co. (2001) 90 Cal.App.4th 500, 505 [“[W]e rely on and accept as true the contents of the exhibits and treat as surplusage the pleader’s allegations as to the legal effect of the exhibits.”]). 

A demurrer can only be sustained when it disposes of an entire cause of action. (Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97,119; Kong v. City of Hawaiian Gardens Redev. Agency (2003) 108 Cal.App.4th 1028, 1046.)

Discussion

          Preliminarily, the parties met the meet and confer requirements. (Decl. Fok ¶¶ 3-9.) (Code Civ. Pro. § 430.41, subd. (a).)

          First Cause of Action – Reformation of Contract – Mistake

“A complaint for reformation based on mutual mistake must allege facts showing how the mistake was made, whose mistake it was, and what brought it about, so that the mutuality may appear… If the mistake was unilateral, which the other at the time knew or suspected… the complaint must allege supporting facts, and the plaintiff may not rely on conclusory allegations.” (Komorsky v. Farmers Ins. Exch. (2019) 33 Cal.App.5th 960, 974-975). “A mistake of fact may be the basis for reformation of a written agreement only if the mistake is material to the agreement.” (Cottle v. Gibbon (1962) 200 Cal.App.2d 1, 8)

The complaint lacks allegations detailing how the alleged mistake was made, whose mistake it was, and what brought it about. (Komorsky, supra, at pp. 974-975.) The extent of the allegations regarding the alleged mistake are simply that Plaintiff discovered problems with developing the Property after executing the Purchase Agreement. (Compl., ¶¶ 11-12.) These allegations are insufficient because they do not satisfy the criteria set forth in Komorsky for mutual mistake. (Komorsky, supra, at pp. 974-975.) The court finds that the Complaint fails to allege sufficient facts to state a cause of action for reformation of contract by mistake.

The court sustains the demurrer as to this cause of action with leave to amend.

          “[D]emurrers for uncertainty are disfavored and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.”  (Mahan v. Charles W. Chan Ins. Agency, Inc. (2017) 14 Cal.App.5th 841, 848, fn. 3, citing Lickiss v. Fin. Indus. Regulatory Auth. (2012) 208 Cal.App.4th 1125, 1135.)  In addition, even where a complaint is in some respects uncertain, courts strictly construe a demurrer for uncertainty “because ambiguities can be clarified under modern discovery procedures.”  (Khoury v. Maly’s of Cal., Inc. (1993) 14 Cal.App.4th 612, 616.) 

          Here, the pleading is not so incomprehensible that a defendant cannot reasonably respond.

Thus, the court overrules the demurrer as to this cause of action on this ground.

          Second Cause of Action – Reformation of Contract – Misrepresentation

The elements of an action for fraud and deceit based on a 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) because of the concealment or suppression of the fact,

the plaintiff must have sustained damage.” (Boschma v. Home Loan Center, Inc.

(2011) 198 Cal.App.4th 230, 248)

The complaint lacks allegations that Defendant had the duty to disclose that Plaintiff could lawfully occupy and further develop the improvements. It also lacks allegations that Defendant intentionally concealed or suppressed the fact with the intent to defraud the plaintiff. The complaint further lacks allegations that Plaintiff was unaware and would not have acted as it did had it known of the concealed or suppressed fact and that because of the concealment or suppression of the fact, the plaintiff must have sustained damage.

The court sustains the demurrer as to this cause of action with leave to amend.

          As discussed above, demurrers for uncertainty are disfavored and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.  (Mahan v. Charles W. Chan Ins. Agency, Inc., supra, 14 Cal.App.5th 841 at p. 848, fn. 3.)  In addition, even where a complaint is in some respects uncertain, courts strictly construe a demurrer for uncertainty “because ambiguities can be clarified under modern discovery procedures.”  (Khoury v. Maly’s of Cal., Inc., supra, 14 Cal.App.4th 612 at p. 616.) 

          Here, the pleading is not so incomprehensible that a defendant cannot reasonably respond.

Thus, the court overrules the demurrer as to this cause of action on this ground.

          Third Cause of Action – Specific Performance

“To obtain specific performance after a breach of contract, a plaintiff must generally show: ‘(1) contract breach; (2) the inadequacy of legal remedy; (3) an underlying contract that is both reasonable and supported by adequate consideration; (4) the existence of a mutuality of remedies; (5) contractual terms which are sufficiently definite to enable the court to know what it is to enforce; and (6) a substantial similarity of the requested performance to that promised in the contract.’” (Real Est. Analytics, LLC v. Vallas (2008) 160 Cal.App.4th 463, 472.) The buyer in a suit for specific performance must show that he or she paid, offered to pay, or is willing and able to pay the purchase price if specific performance is awarded. (Buckmaster v. Bertram (1921) 186 Cal. 673, 677.)

The court finds that the complaint fails to allege facts to state a claim for specific performance because Plaintiff has not alleged a breach of contract.

The court sustains the demurrer as to this cause of action with leave to amend.

          As discussed above, demurrers for uncertainty are disfavored and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.  (Mahan v. Charles W. Chan Ins. Agency, Inc., supra, 14 Cal.App.5th 841 at p. 848, fn. 3.)  In addition, even where a complaint is in some respects uncertain, courts strictly construe a demurrer for uncertainty “because ambiguities can be clarified under modern discovery procedures.”  (Khoury v. Maly’s of Cal., Inc., supra, 14 Cal.App.4th 612 at p. 616.) 

          Here, the pleading is not so incomprehensible that a defendant cannot reasonably respond.

Thus, the court overrules the demurrer as to this cause of action on this ground.

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

            Cross-Defendants demur to the breach of contract and quiet title causes of action on the grounds that that they do not state facts sufficient to constitute causes of action and they are uncertain.

          The court overrules cross-defendants’ demurrer to both causes of action.

Background

          This action arises out of a real property dispute. Plaintiff Bonsall Properties LLC (“Plaintiff”) alleges that it entered into a written agreement (the “Purchase Agreement”) with Defendant Robert Seng, as Trustee of the Mary Lou Walbergh Qualified Personal Residence Trust (“Defendant”) regarding the purchase of real property located at 5838 Bonsall Dr., Malibu, CA 90265 (the “Property”). Plaintiff alleges that it made a deposit towards the purchase of the Property and that after execution of the Purchase Agreement, Plaintiff discovered numerous issues with the Property that would prohibit Plaintiff’s intended development plans for it. Plaintiff also alleges that the Purchase Agreement provided the Property would be vacant, but that Plaintiff recently discovered persons occupying the Property with Defendant’s knowledge and that they occupied the Property at the time of the original closing and there is no current binding agreement for them to vacate the Property.

          Plaintiff filed this action on December 29, 2022, alleging causes of action against Defendant for reformation of contract based on mistake and misrepresentation, and for specific performance. Defendant filed a cross-complaint on February 1, 2023, alleging causes of action against Plaintiff and Sonny Astani for breach of contract, quiet title, declaratory relief, and slander of title.

          On March 9, 2023, Cross-Defendants Bonsall Properties LLC and Sonny Astani demurred to the breach of contract and quiet title cause of action in the cross-complaint. On June 22, 2023, Cross-Complainant Robert Seng opposed. On September 14, 2023, Cross-Defendants replied.

Legal Standard

A demurrer is a pleading used to test the legal sufficiency of other pleadings. It raises issues of law, not fact, regarding the form or content of the opposing party's pleading (complaint, answer or cross-complaint). (Code Civ. Pro., §§ 422.10, 589; see Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) It is not the function of the demurrer to challenge the truthfulness of the complaint; and for purposes of the ruling on the demurrer, all facts pleaded in the complaint are assumed to be true. (Donabedian, supra, 116 Cal.App.4th at p. 994.) 

A demurrer can be used only to challenge defects that appear on the face of the pleading under attack; or from matters outside the pleading that are judicially noticeable. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian, supra, 116 Cal.App.4th at p. 994.) No other extrinsic evidence can be considered. (Ion Equip. Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881 [error for court to consider facts asserted in memorandum supporting demurrer]; see also Afuso v. United States Fid. & Guar. Co. (1985) 169 Cal.App.3d 859, 862 [disapproved on other grounds in Moradi-Shalal v. Fireman’s Fund Ins. Cos. (1988) 46 Cal.3d 287] [error to consider contents of release not part of court record].)  Where written documents are the foundation of an action and are attached to the complaint and incorporated therein by reference, they become a part of the complaint and may be considered on demurrer. (Byrne v. Harvey (1962) 211 Cal.App.2d 92, 103.) The complaint must be construed liberally by drawing reasonable inferences from the facts pleaded. (Flynn v. Higham (1983) 149 Cal.App.3d 677, 679.)

A demurrer can be utilized where the “face of the complaint” itself is incomplete or discloses some defense that would bar recovery. (Guardian North Bay, Inc. v. Super. Court (2001) 94 Cal.App.4th 963, 971-72.) The “face of the complaint” includes material contained in attached exhibits that are incorporated by reference into the complaint; or in a superseded complaint in the same action. (Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94; see also Barnett v. Fireman’s Fund Ins. Co. (2001) 90 Cal.App.4th 500, 505 [“[W]e rely on and accept as true the contents of the exhibits and treat as surplusage the pleader’s allegations as to the legal effect of the exhibits.”]). 

A demurrer can only be sustained when it disposes of an entire cause of action. (Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97,119; Kong v. City of Hawaiian Gardens Redev. Agency (2003) 108 Cal.App.4th 1028, 1046.)

Discussion

          Preliminarily, the parties did not meet the meet and confer requirements because they did not meet by telephone or in person. (Decl. Hooks ¶¶ 2-4.) (Code Civ. Pro. § 430.41, subd. (a).)

          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.) The facts alleging a breach must be pleaded with specificity. (Levy v. State Farm Mutual Auto Ins. Co. (2007) 150 Cal.App.4th 1, 5.) General allegations of due performance may not suffice if the facts as alleged do not constitute due performance. (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1389-1390.)

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.) In some circumstances, a plaintiff may also “plead the legal effect of the contract rather than its precise language.” (Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 198-199.) 

          Here, Cross-Defendant argues that Cross-Complainant did not adequately plead the second element, plaintiff’s performance or excuse for nonperformance, because Cross-Defendant does not address whether the issue of a tenant on the property has been resolved. Cross-Defendant further argues that the issue of a tenant on the property is a material breach of the parties’ agreement and relevant to the question of Cross-Complainant’s performance of the terms of the agreement.

          Nowhere does Cross-Complaint allege the presence of a tenant on the property. As discussed above, a demurrer can be used only to challenge defects that appear on the face of the pleading under attack; or from matters outside the pleading that are judicially noticeable. (Blank v. Kirwan, supra, 39 Cal.3d at p. 318; Donabedian v. Mercury Ins. Co., supra, 116 Cal.App.4th at p. 994.) No other extrinsic evidence can be considered. (Ion Equip. Corp. v. Nelson, supra, 110 Cal.App.3d at p. 881.)

          In its reply, Cross-Complainant argues that the court can and should take judicial notice of the existence of a tenant on the property, but Cross-Complaint has not requested judicial notice of this or any matter.

          Thus, the court overrules Cross-Defendant’s demurrer as to breach of contract on this ground.

            “[D]emurrers for uncertainty are disfavored and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.”  (Mahan v. Charles W. Chan Ins. Agency, Inc. (2017) 14 Cal.App.5th 841, 848, fn. 3, citing Lickiss v. Fin. Indus. Regulatory Auth. (2012) 208 Cal.App.4th 1125, 1135.)  In addition, even where a complaint is in some respects uncertain, courts strictly construe a demurrer for uncertainty “because ambiguities can be clarified under modern discovery procedures.”  (Khoury v. Maly’s of Cal., Inc. (1993) 14 Cal.App.4th 612, 616.) 

          Here, the pleading is not so incomprehensible that a defendant cannot reasonably respond.

          Thus, the court overrules the Cross-Defendant’s demurrer to breach of contract on this ground too.

          Second Cause of Action – Quiet Title

In an action for quiet title, Plaintiff must plead (1) “[a] description of the property that is the subject of the action,” specifically the location of tangible personal property and the legal description and street address or common designation of real property, (2) “[t]he title of the plaintiff as to which a determination under this chapter is sought and the basis of the title,” (3) “[t]he adverse claims to the title of the plaintiff against which a determination is sought,” (4) “[t]he date as of which the determination is sought,” and (5) “[a] prayer for the determination of the title of the plaintiff against the adverse claims.” (Code Civ. Proc., § 761.020.) 

Here, Cross-Defendant argues that Cross-Complainant has only named Sonny Astani and Bonsall Properties, LLC as cross-defendants and not the tenant occupying the property. For the same reasons discussed above, the demurrer as to quiet title is overruled.

          Additionally, like the above, the pleading is not so incomprehensible that a defendant cannot reasonably respond.

Thus, the court overrules the Cross-Defendant’s demurrer to quiet title on this ground too.

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

Defendant moves to expunge lis pendens and for an award of attorney’s fees and costs of $3,054.43.

The Court continues the Motion to Expunge Lis Pendens to December 21, 2023 and sets a Case Management Conference for the same day. 

Background

          This action arises out of a real property dispute. Plaintiff Bonsall Properties LLC (“Plaintiff”) alleges that it entered into a written agreement (the “Purchase Agreement”) with Defendant Robert Seng, as Trustee of the Mary Lou Walbergh Qualified Personal Residence Trust (“Defendant”) regarding the purchase of real property located at 5838 Bonsall Dr., Malibu, CA 90265 (the “Property”). Plaintiff alleges that it made a deposit towards the purchase of the Property and that after execution of the Purchase Agreement, Plaintiff discovered numerous issues with the Property that would prohibit Plaintiff’s intended development plans for it. Plaintiff also alleges that the Purchase Agreement provided the Property would be vacant, but that Plaintiff recently discovered persons occupying the Property with Defendant’s knowledge and that they occupied the Property at the time of the original closing and there is no current binding agreement for them to vacate the Property.

          Plaintiff filed this action on December 29, 2022, alleging causes of action against Defendant for reformation of contract based on mistake and misrepresentation, and for specific performance. Defendant filed a cross-complaint on February 1, 2023, alleging causes of action against Plaintiff and Sonny Astani for breach of contract, quiet title, declaratory relief, and slander of title.

          On March 24, 2023, Defendant filed a motion to expunge lis pendens and for an award of attorney’s fees and costs of $3,054.43. On June 2, 2023, Plaintiff opposed the Motion. On June 7, 2023, Defendant replied.

Legal Standard

“A lis pendens is a recorded document giving constructive notice that an action has been filed affecting title or right to possession of the real property described in the notice.¿A lis pendens may be filed by any party in an action who asserts a ‘real property claim.’”¿(Kirkeby v. Super. Ct. (2004) 33 Cal.4th 642, 647.) Real property claim’ means the cause or causes of action in a pleading which would, if meritorious, affect (a) title to, or the right to possession of, specific real property or (b) the use of an easement identified in the pleading, other than an easement obtained pursuant to statute by any regulated public utility. (Code Civ. Proc., § 405.4.) 

With exceptions not applicable here, “[a]t any time after notice of pendency of action has been recorded, any party, or any nonparty with an interest in the real property affected thereby, may apply to the court in which the action is pending to expunge the notice.”¿(Code Civ. Proc., § 405.30.) “[T]he court shall order that the notice be expunged if the court finds that the claimant has not established by a preponderance of the evidence the probable validity of the real property claim.”¿(Code Civ. Proc., § 405.32.) “Unlike most other motions, when a motion to expunge is brought, the burden is on the party opposing the motion to show the existence of a real property claim.”¿(Kirkeby, supra, 33 Cal.4th at 647.) 

“The expungement statutes provide that a lis pendens may be expunged on three grounds: (1) ‘the pleading on which the notice is based does not contain a real property claim’ (Code Civ. Proc., § 405.31); (2) ‘the claimant has not established by a preponderance of the evidence the probable validity of the real property claim’ (Code Civ. Proc., § 405.32); or (3) ‘adequate relief can be secured to the claimant by the giving of an undertaking’ (Code Civ. Proc., § 405.33).” (Carr v. Rosien (2015) 238 Cal.App.4th 845, 857.) Probable validity is met when the Plaintiff establishes his claim by a preponderance of the evidence. (Code Civ. Proc., § 405.32.) 

The party prevailing on an expungement motion must be awarded reasonable attorney fees and costs incurred in making or opposing the motion unless the court finds the other party acted with “substantial justification” or that other circumstances make the imposition of attorney fees and costs “unjust.” (Code Civ. Proc., § 405.38.) 

Discussion

Defendant filed this Motion to Expunge Lis Pendens based on Code of Civil Procedure sections 405.32 and 405.33, which seek to expunge Plaintiff’s lis pendens recorded against the property based on Plaintiff’s purported inability to prove claims in the complaint. However, considering that the court has sustained Defendant’s demurrer with leave to amend as to each cause of action, there is presently no cause of action to assess the Motion against.  The Court will be in a better position to assess the parties’ arguments and counterarguments when the pleadings are set.

Accordingly, the Court continues this motion to December 21, 2023.  The Court also sets a case management conference for the same day.