Judge Kerry Bensinger, Case Number: 24STCV33471, Date: 2025-04-23 Tentative Ruling

On December 18, 2024, Plaintiffs, Alejandra Gonzalez and Eder Hernandez, filed this Song-Beverly action against Defendants, Ford Motor Company and LAD-F, Inc. dba Ford of Downtown LA (“LAD-F”), alleging causes of action for (1) Violation of Song-Beverly Act –Breach of Express Warranty, (2) Violation of Song-Beverly Act – Breach of Implied Warranty, and (3) Negligent Repair. The Third Cause of Action is the only cause of action asserted against LAD-F.

A demurrer for sufficiency tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747.) When considering demurrers, courts read the allegations liberally and in context, accepting the alleged facts as true. (Nolte v. Cedars-Sinai Medical Center (2015) 236 Cal.App.4th 1401, 1406.) “Because a demurrer challenges defects on the face of the complaint, it can only refer to matters outside the pleading that are subject to judicial notice.” (Arce ex rel. Arce v. Kaiser Found. Health Plan, Inc. (2010) 181 Cal.App.4th 471, 556.)

LAD-F’s unopposed request for judicial notice is GRANTED. (Evid. Code, § 452(d).)

The Third Cause of Action is for negligent repair. As alleged in the Complaint, Plaintiffs delivered the vehicle to LAD-F for repair during the express warranty period for a warranted defect (Complaint, ¶ 40), LAD-F breached its duty to use ordinary care and skill by failing to properly store, prepare and repair of the subject vehicle in accordance with industry standards (Complaint, ¶ 42), and LAD-F’s negligent breach of its duties owed to Plaintiffs was a proximate cause of Plaintiff's’ damages (Complaint, ¶ 43).

LAD-F argues the negligent repair claim fails for two reasons: (1) the economic loss rule bars Plaintiff’s negligent repair claim; (2) the component part exception to the economic loss rule does not apply; and (3) Plaintiffs do not allege the element of damages. The court agrees in considerable part with LAD-F’s third argument.

The necessary elements for negligence are: (1) the existence of a legal duty of care that the defendant owed to the plaintiff; (2) breach; (3) causation; and (4) damages. (County of Santa Clara v. Atlantic Richfield Co. (2006) 137 Cal.App.4th 292, 318; see CACI No. 1220.)

Here, Plaintiffs fails to specify in either the Complaint or their opposition brief the type of damages they suffered because of LAD-F’s alleged negligence. Contrary to Plaintiffs’ position, they are required to allege specific facts showing that LAD-F’s negligence caused or contributed to a non-economic injury. (See County of Santa Clara, 137 Cal.App.4th at p. 318 [“economic loss alone, without physical injury, does not amount to type of damage that causes negligence cause of action to accrue]; see also Seely v. White Motor Co. (1965) 63 Cal.2d 9, 17-18; Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 988 (Robinson).) The negligent repair claim is not sufficiently pleaded.

Further, because it is not clear what damages Plaintiffs suffered as a result of LAD-F’s negligence, the court cannot determine the merits of LAD-F’s economic loss argument.

The economic loss rule provides that, “[i]n general, there is no recovery in tort for negligently inflicted ‘purely economic losses,’ meaning financial harm unaccompanied by physical or property damage.” (Sheen v. Wells Fargo Bank, N.A. (2022) 12 Cal.5th 905, 922.)¿¿¿ “California Courts define economic loss as ‘damages for inadequate value, costs of repair and replacement of the defective product or consequent loss of profits—without any claim of personal injury or damages to other property.’” (Department of Water & Power v. ABB Power T & D Co. (C.D .Cal. 1995) 902 F.Supp. 1178, 1186, fn. 4.) The economic loss rule requires a purchaser to recover in contract for purely economic loss due to disappointed expectations unless she can demonstrate harm above and beyond a broken contractual promise. (Robinson, supra, 34 Cal.4th at pp. 988, 993 [economic loss rule prevents law of contract and law of tort “from dissolving one into the other”].)

There exist four (4) exceptions to the economic loss rule barring recovery in tort in a breach of contract action: (1) where the breach of duty directly caused physical injury; (2) where there was a breach of the covenant of good faith and fair dealing in insurance contracts; (3) for wrongful discharge in violation of fundamental public policy; or (4) where the contract was fraudulently induced. (See Erlich v. Menezes (1999) 21 Cal.4th 543, 551-552; see Robinson, supra, 34 Cal.4th at pp. 989-990.)

The parties spar over whether an exception applies to Plaintiffs’ negligent repair claim. However, without properly identifying the alleged damages, the arguments are undeveloped. For instance, Plaintiffs argue the economic loss rule does not necessarily bar recovery in tort for damage a defective product (e.g., a window) causes to other portions of a larger product (e.g., a house) into which the former has been incorporated. However, there are no allegations of a defect in the vehicle that caused damage to another portion of the vehicle.

Based on the foregoing, the demurrer to the Third Cause of Action is SUSTAINED. Leave to amend is GRANTED.

Plaintiffs are ordered to serve and file the First Amended Complaint within 20 days of the date of this order.

Kerry Bensinger

Judge of the Superior Court