Judge: Joseph Lipner, Case: 23STCV31738, Date: 2025-05-15 Tentative Ruling

Case Number: 23STCV31738    Hearing Date: May 15, 2025    Dept: 72

SUPERIOR COURT OF CALIFORNIA

COUNTY OF LOS ANGELES

DEPARTMENT 72

TENTATIVE RULING

Plaintiff and Cross-Defendant Renante Perez (“Plaintiff”) moves for summary adjudication on the second and third claims in the Cross-Complaint filed by Defendant and Cross-Complainant Nurses Resource Home Health, Inc. (“NRHH”).

The Court GRANTS the motion for summary adjudication.

Background

This is a corporate dispute.

Plaintiff was employed as the CFO of NRHH. NRHH alleges that in October 2020, when Plaintiff was employed as CFO, Plaintiff transferred approximately $250,000.00 from an NRHH bank account to Plaintiff’s personal bank account for his personal use and for no legitimate business purpose (the “October 27 Transfer”). (Cross-Complaint ¶ 12.) NRHH alleges that Plaintiff embezzled this money through trickery, cunning, fraud, and deception. (Cross-Complaint ¶ 16.)

Plaintiff filed this action against Defendants NRHH and Sheila M Paguio (“Paguio”) on December 28, 2023. The operative complaint is now the First Amended Complaint (“FAC”). The FAC raises claims for (1) declaratory relief; (2) breach of contract (against Paguio); (3) fraudulent inducement (against Paguio); (4) promissory estoppel (against Paguio); (5) conversion – equity interest (against Paguio); (6) conversion – personal belongings; (7) breach of oral contract (against NRHH); (8) breach of obligation to pay money on account stated (against NRHH); and (9) restitution for unjust enrichment (against NRHH).

On February 26, 2024, NRHH filed the Cross-Complaint against Plaintiff, which raises claims for (1) conversion; (2) breach of fiduciary duty; and (3) constructive trust.

On January 21, 2025, Plaintiff filed this motion for summary adjudication. No party has filed an opposition.

Request for Judicial Notice

The Court grants Plaintiff’s request for judicial notice and takes notice of the submitted records from this case.

Legal Standard

The purpose of a motion for summary judgment or summary adjudication “is to provide courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at p. 843.) “Code of Civil Procedure section 437c, subdivision (c), requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.) 

“In ruling on the motion, the court must consider all of the evidence and all of the inferences reasonably drawn therefrom [citation] and must view such evidence [citations] and such inferences [citations] in the light most favorable to the opposing party.” (Aguilar, supra, at pp. 844-845 [quotation marks omitted].) 

“On a motion for summary judgment, the initial burden is always on the moving party to make a prima facie showing that there are no triable issues of material fact.” (Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1519.) 

“A plaintiff or cross-complainant has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action. Once the plaintiff or cross-complainant has met that burden, the burden shifts to the defendant or cross-defendant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto. The defendant or cross-defendant shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.” (Code Civ. Proc. § 437c, subd. (p)(1).)

To establish a triable issue of material fact, the party opposing the motion must produce substantial responsive evidence. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 166.) “If the [opposing party] cannot do so, summary judgment should be granted.” (Avivi v. Centro Medico Urgente Medical Center (2008) 159 Cal.App.4th 463, 467.)

Discussion

Second Claim – Breach of Fiduciary Duty

“The elements of a cause of action for breach of fiduciary duty are the existence of a fiduciary relationship, breach of fiduciary duty, and damages.” (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 820.)

“The statute of limitations for breach of fiduciary duty is three years or four years, depending on whether the breach is fraudulent or nonfraudulent.” (American Master Lease LLC v. Idanta Partners, Ltd. (2014) 225 Cal.App.4th 1451, 1479.) “The limitations period is three years … for a cause of action for breach of fiduciary duty where the gravamen of the claim is deceit, rather than the catchall four-year limitations period that would otherwise apply [citation].” (Fuller v. First Franklin Financial Corp. (2013) 216 Cal.App.4th 955, 963.)

NRHH alleges that Plaintiff committed embezzlement via fraud, meaning that the three  year statute applies. The allegedly wrongful conduct occurred in October 2020. NRHH filed its Cross-Complaint on February 26, 2024. Thus, the face of the Cross-Complaint discloses a statute of limitations issue. 

Plaintiff anticipates NRHH will contend that the delayed discovery rule applies (although NRHH does not oppose this motion to make such an argument).

“A cause of action accrues when the claim is complete with all of its elements. [Citation.] Although this ordinarily occurs on the date of the plaintiff's injury, accrual is postponed until the plaintiff either discovers or has reason to discover the existence of a claim, i.e., at least has reason to suspect a factual basis for its elements.” (Slovensky v. Friedman (2006) 142 Cal.App.4th 1518, 1528–1529.)

“[T]he delayed discovery rule ‘postpones accrual of a cause of action until the plaintiff discovers, or has reason to discover, the cause of action.’ [Citation.]” (Ross v. Seyfarth Shaw LLP (2023) 96 Cal.App.5th 722, 741.) “For these purposes, ‘[a] plaintiff has reason to discover a cause of action when he or she ‘has reason at least to suspect a factual basis for its elements.’ [Citations.] ... [S]uspicion of one or more of the elements of a cause of action, coupled with knowledge of any remaining elements, will generally trigger the statute of limitations period. [Citations.] ... Rather than examining whether the plaintiffs suspect facts supporting each specific legal element of a particular cause of action, we look to whether the plaintiffs have reason to at least suspect that a type of wrongdoing has injured them.’ [Citation.] The party claiming the benefit of the delayed discovery rule bears the burden of showing its applicability.” (Ibid.)

The April 2020 bank statement of the NRHH Operating Account reflects that $700,000.00 was transferred from the Operating Account to the NRHH Money Market Account on April 27, 2020. (Undisputed Fact (“UF”) 8.) Sheila Paguio, NRHH’s CEO, had knowledge of this transfer at the time of the transfer. (UF 9.)

On October 27, 2020, Perez transferred $250,010.00 from the Money Market Account to his personal bank account. (UF 10.) The October 27 Transfer was reflected on the October 2020 Money Market Account bank statement. (UF 11.) The October 2020 Money Market Account bank statement was addressed to NRHH’s office. (UF 14.)

Angelica Paguio (“Angelica”), a bookkeeper for NRHH, performed accounting work for NRHH. (UF 5.) Angelica had access to the Money Market Account bank statement for October 2020 near the time of the October 27 Transfer. (UF 13.) Paguio also had access to the Money Market Account bank statement. (UF 12.) Angelica learned about the October 27 transfer around the time of the transfer when she was preparing the reconciliation for tax purposes. (UF 15.) Angelica testified at her deposition that she would have informed Paguio, the CEO, about the transfer when she discovered it. (UF 16.) Further, there is no evidence that Plaintiff deceived NRHH as to the October 27 Transfer.

The undisputed facts show that the statute of limitations has run and that NRHH had access to the bank account statements at or near the time of the October 27 Transfer. Accordingly, Plaintiff has met his initial burden on this summary adjudication motion.  The burden shifts to NRHH.

NRHH has not filed any opposition or contrary evidence.  Thus, NRHH has shown no triable issue of fact, included no triable issue about whether NRHH had reason to suspect that Plaintiff had enacted the transfer shortly after the transfer was completed. Plaintiff is therefore entitled to summary adjudication on this claim.

Third Claim – Constructive Trust

“Imposition of ‘[a] constructive trust is an equitable remedy to compel the transfer of property by one who is not justly entitled to it to one who is. [Citation.]’ [Citations.] It is not ‘a substantive claim for relief.’ [Citation.]” (American Master Lease LLC v. Idanta Partners, Ltd. (2014) 225 Cal.App.4th 1451, 1485.)

The Court therefore grants summary adjudication as to this claim.  The Court expresses no opinion as to whether NRHH can assert a constructive trust as a remedy in this matter on its cross-claim for conversion.