Judge: Joseph Lipner, Case: 23STCV25631, Date: 2024-11-19 Tentative Ruling

Case Number: 23STCV25631    Hearing Date: November 19, 2024    Dept: 72

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

Defendant Linda J. Maultsby (“Maultsby”) demurs to the Second Amended Complaint (“SAC”) filed by Plaintiff Mural Media, LLC 401K Plan (“Plaintiff”).

The Court OVERULES the demurrer.  Maultsby shall file an answer within 10 days.

Background

This is an unlawful detainer case. The following facts are taken from the allegations and attached exhibits in Plaintiff’s Complaint, except where otherwise noted.

Plaintiff is the owner of real property that is legally described as “Lot 446 of Tract No. 1446, in the City of Los Angeles, County of Los Angeles, State of California, as per Map recorded in Book 20, Page 34 of Maps, in the office of the County recorder of said County” (the “Property”). The Property contains a multi-unit building which is comprised of four units with the following addresses: (1) 2757 South Mansfield Avenue, Los Angeles, CA 90016; (2) 2759 South Mansfield Avenue, Los Angeles, CA 90016; (3) 5107 Westhaven St., Los Angeles, CA 90016; and (4) 5109 Westhaven St., Los Angeles, CA 90016.

Maultsby is a tenant at the Property pursuant to a lease agreement that pre-dates Plaintiff’s ownership of the Property. Maultsby occupies 2759 South Mansfield Avenue, Los Angeles, CA 90016 (the “Unit”).

Plaintiff entered an agreement to sell the Property to a third party. The third party wished to inspect the Property, including the Unit. On August 9, 2023, Plaintiff served on Defendant a notice requiring Defendant to permit an inspection of the Property and Unit. Plaintiff subsequently delivered a second letter requesting the same, on an unspecified date. Defendant did not allow Plaintiff to inspect the Property and the Unit.

On September 1, 2023, Plaintiff filed a complaint against Defendant in the Superior Court for the County of Los Angeles Stanley Mosk Courthouse, Department 78, Case No. 23STCV21442 (the “Department 78 Action”), raising a claim for unlawful detainer. The complaint in the Department 78 Action seeks restitution and possession of the Property and Unit, damages, and costs of suit. The complaint in the Department 78 action attaches as Exhibit 2 a three-day notice to quit that was served on August 24, 2023 and is identical to the August 24 Notice attached as Exhibit 2 in this action.

On October 20, 2023, Plaintiff filed this action (the “Department 72 Action”), raising a claim against Plaintiff for unlawful detainer. The Complaint seeks restitution of the Unit, damages, and costs of suit.

On February 29, 2024, the Court stayed the Department 72 Action pending the resolution of the Department 78 Action under the doctrine of exclusive concurrent jurisdiction.

On May 14, 2024, judgment was entered for Defendant in the Department 78 Action as a result of Defendant’s demurrer in that case.

On July 18, 2024, the Court issued an order lifting the stay on the Department 72 Action and granting Plaintiff leave to amend to correct a number of deficiencies in the Complaint, to plead an alternate cause of action based on a Notice to Quit that was served after this case was initiated by Plaintiff, and to name additional alleged occupants of the Property as defendants.

On July 25, 2024, Plaintiff filed the First Amended Complaint (“FAC”) against Defendants Maultsby, Jaccoma Maultsby, Jezreel Maultsby, Charmaine Thompson, Blanca Estala Tinoco, Jorge Tinoco, and Olivia Weaver, raising two causes of action for unlawful detainer.

On September 3, 2024, the Court sustained Maultsby’s demurrer to the FAC on the basis of incapacity. The Court granted leave to amend so that Plaintiff could allege what type of entity it is and the legal basis for its capacity to sue.

On September 13, 2024, Plaintiff filed the SAC, which raises two claims for unlawful detainer.

On September 25, 2024, Maultsby demurred to the SAC. Plaintiff filed an opposition and Maultsby filed a reply.

Requests for Judicial Notice

The Court grants Maultsby’s requests for judicial notice and takes notice of the requested public records.

Legal Standard

“The party against whom a complaint or cross-complaint has been filed may object, by demurrer or answer as provided in Section 430.30, to the pleading on any one or more of the following grounds:

(a) The court has no jurisdiction of the subject of the cause of action alleged in the pleading.

(b) The person who filed the pleading does not have the legal capacity to sue.

(c) There is another action pending between the same parties on the same cause of action.

(d) There is a defect or misjoinder of parties.

(e) The pleading does not state facts sufficient to constitute a cause of action.

(f) The pleading is uncertain. As used in this subdivision, “uncertain” includes ambiguous and unintelligible.

(g) In an action founded upon a contract, it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.

(h) No certificate was filed as required by Section 411.35.”

(Code Civ. Proc., § 430.10.)

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).

Discussion

Uncertainty and Failure to State a Claim

Although Maultsby raises these grounds for demurrer in her notice, she does not make any argument as to them. The Court therefore does not find that these grounds are a basis for sustaining the demurrer.

Capacity to Sue

As discussed above, lack of capacity is properly raised on demurer. (Code Civ. Proc., § 430.10, subd. (b).)

A limited liability company has the capacity to sue and be sued. (Corp. Code, § 17701.05, subd. (b).)

Mural Media LLC (not Plaintiff) is a limited liability company organized in the State of Oregon on December 31, 1996 and dissolved by the Secretary of State for the State of Oregon on February 28, 2019. (Plaintiff’s Request for Judicial Notice in Support of Demurrer to FAC, Ex. E.) Mural Media LLC was never reinstated by the State of Oregon and there are currently no active filings for the exact name “Mural Media LLC” in the State of Oregon. (Plaintiff’s Request for Judicial Notice in Support of Demurrer to FAC, Ex. B.) Mural Media, LLC was registered as a foreign LLC in the State of California to conduct intrastate transactions on March 30, 2000, and its registration was terminated by the California Secretary of State on February 14, 2022. (Plaintiff’s Request for Judicial Notice in Support of Demurrer to FAC, Ex. C.)

The Court previously found that the FAC did not reflect that Plaintiff has capacity to sue. In its opposition to Maultsby’s demurrer to the FAC, Plaintiff argued that it is not an LLC, but rather, a retirement plan. (Opposition to Demurrer to FAC at pp. 8:21-9:2.) Plaintiff stated that Mural Media, LLC is a separate entity from Plaintiff Mural Media, LLC 401k Plan. (Opposition to Demurrer to FAC at pp. 8:21-9:2.)

Plaintiff now alleges that it is a retirement plan, and not an LLC. (SAC ¶ 1.) Plaintiff alleges that it is a separate entity from Mural Media, LLC. (SAC ¶ 2.) Plaintiff alleges that, as a separate entity, it generally has capacity to sue. (SAC ¶ 3.)

“ ‘A pension plan […] is a formal plan or program whereby funds are accumulated to pay for retirement income or other deferred income to employees of an employer, payable at a future date, generally at the normal retirement age as specified in the plan. The plan […] constitutes a separate entity from the employer[.]’ ” (Coastline JX Holdings LLC v. Bennett (2022) 80 Cal.App.5th 985, 1005 fn. 8 [citation to practice guide omitted] [holding at p. 1006 that profit-sharing plan established subject to ERISA was not subject to claims by creditors of the employer].)

            “In general, any person or entity has capacity to sue or defend a civil action in the California courts. This includes artificial ‘persons’ such as corporations, partnerships and associations.” (American Alternative Energy Partners II v. Windridge, Inc. (1996) 42 Cal.App.4th 551, 559.) “A partnership or other unincorporated association has capacity both to sue and be sued in the name it has assumed or by which it is known.” (Ibid.)

            Maultsby contends that a pension plan cannot properly be considered a person because Family Code, section 105 defines “person” to include “a natural person, firm, association, organization, partnership, business trust, corporation, limited liability company, or public entity.” (Fam. Code, § 105.) The Family Code separately defines “employee benefit plan” to include “public and private retirement, pension, annuity, savings, profit sharing, stock bonus, stock option, thrift, vacation pay, and similar plans of deferred or fringe benefit compensation, whether of the defined contribution or defined benefit type whether or not such plan is qualified under the Employee Retirement Income Security Act of 1974 (P.L. 93-406) (ERISA), as amended. The term also includes “employee benefit plan” as defined in Section 3 of ERISA (29 U.S.C.A. Sec. 1002(3)).” (Fam. Code, § 80.)

            There are two problems with this argument. First, the definitions in sections 80 and 105 were written to cover the construction of the Family Code. (Fam. Code, § 50.) Plaintiff has not provided authority indicating that these definitions were intended to control California corporations law or civil procedure. Second, insofar as an employee benefit plan is a ‘separate entity’ (see Coastline JX Holdings LLC, supra, 80 Cal.App.5th at p. 1005 fn. 8), it appears to constitute an organization. Thus, even if Family Code, section 105 controls, it does not appear to exclude an entity retirement plan.

            Thus, the Court finds that Plaintiff has adequately alleged its capacity to sue.

            The Court therefore overrules the demurrer.