Judge: Lee W. Tsao, Case: 22NWCV01407, Date: 2023-08-15 Tentative Ruling
Case Number: 22NWCV01407 Hearing Date: February 28, 2024 Dept: C
Hinojosa, et al. v. General Motors LLC
CASE NO.: 22NWCV01407
HEARING: 2/28/24 @ 9:30 AM
#4
TENTATIVE RULING
I.
Defendant General Motor LLC’s demurrer to plaintiffs’ first amended
complaint is OVERRULED.
II.
Defendant General Motor LLC’s motion to strike is DENIED.
Moving Party to give NOTICE.
Defendant General Motors LLC demurs to the
First Amended Complaint’s (FAC) fourth cause of action for fraud on the grounds
that it is time-barred and does not state facts sufficient to constitute a
cause of action. Defendant also moves to strike the claim for punitive damages.
Plaintiffs
Karina Hinojosa and Luis Alejandro Garcia allege that defendant General Motors
LLC violated the Song-Beverly Act and fraudulently induced plaintiffs into
purchasing a 2018 GMC Sierra manufactured by the defendant. They allege that defendant
misrepresented that there were no transmission defects in the said vehicle.
Legal
Standard
The party against whom
a complaint has been filed may object to the pleading, by demurrer, on several
grounds, including that the pleading does not state facts sufficient to
constitute a cause of action. (Code Civ. Proc., § 430.10, subd. (e).) A party
may demur to an entire complaint, or to any causes of action stated therein. (Code
Civ. Proc., § 430.50, subd. (a).)
Motions
to strike are used to reach defects or objections to pleadings which are not
challengeable by demurrer (i.e., words, phrases, prayer for damages, etc.). (Code
Civ. Proc., §§ 435, 436 & 437.) A motion to strike lies only where 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.)
Fourth
Cause of Action – Fraudulent Concealment
As a preliminary matter, the parties have
sufficiently met and conferred. (Decl. Valencia ¶¶ 2,3.) (Code Civ. Proc., § 430.41,
subd. (a)(3); Code Civ. Proc., § 435.5, subd. (a)(3).)
“Fraudulent inducement is a viable tort claim under California law. ‘The
elements of fraud are (a) a misrepresentation (false representation,
concealment, or nondisclosure); (b) scienter or knowledge of its falsity; (c)
intent to induce reliance; (d) justifiable reliance; and (e) resulting
damage.¿¿Fraud in the inducement is a subset of the tort¿of fraud. It ‘occurs
when ‘the promisor knows what he is signing but his consent is induced by
fraud, mutual assent is present and a contract is formed, which, by reason of
the fraud, is voidable.’” (Dhital v. Nissan North America, Inc.
(2022) 84 Cal.App.5th 828, 838-839.) The statute of limitations for bringing a fraud cause of action is
three years. (Civ. Code, § 338, subd. (d).)
Statute of Limitations
Plaintiffs purchased the subject vehicle on
April 17, 2019, and did not file suit until November 23, 2022. (FAC, ¶ 4.)
Defendant argues that the fraud cause of action
is barred by the statute of limitations because plaintiffs cannot invoke
tolling for delayed discovery. The court finds that the delayed discovery rule
may be applied to these facts. Plaintiffs alleged that they first delivered the
subject vehicle for repairs in September 2022 for issues relating to the
transmission defects. (FAC, ¶ 70.) Thus, the running of the statute of limitations
does not appear “clearly and affirmatively” from the face of the complaint. (Com. for Green Foothills v. Santa Clara County
Bd. of Supervisors (2010) 48 Cal. 4th 32, 42.)
Hence, plaintiffs’ fraud cause of action is not
barred by the statute of limitations.
Facts
Sufficient to State Cause of Action
Defendant also argues that the fraud cause of
action does not state sufficient facts to state a cause of action because it
was not pleaded with particularity. Defendant further argues that in a fraud
action against a corporation, plaintiff must allege the name of the persons who
made the allegedly fraudulent representations, their authority to speak, to
whom they spoke, what they said or wrote, and when it was said or written. The
FAC details allegations that defendant concealed that the subject vehicle was
defective; defendant had the duty to disclose that the transmission posed a
safety issue; defendant intentionally concealed the defect from plaintiffs with
the intent to defraud by inducing plaintiffs to purchase the subject vehicle;
plaintiffs were not aware that the transmission was defect and would not have
bought it had they known; and plaintiffs suffered damages as a result of the
concealment. (FAC, ¶¶ 4-22, 31-84, 126-146.) Courts have found the above to be
sufficiently pleaded for a fraud cause of action against a company. (Dhital
v. Nissan North America, Inc., supra, 84 Cal.App.5th 828 at p. 844.)
Thus, the FAC contains adequate allegations to
support a cause of action for fraud.
In addition, the defendant argues that
plaintiffs do not allege that they purchased their vehicle directly from it or
otherwise entered a transaction with it giving rise to a duty to disclose.
In transactions which do not involve fiduciary or confidential
relations, a cause of action for non-disclosure of material facts may arise in
at least three instances: (1) “the defendant had exclusive knowledge of
material facts not known to the plaintiff,” (2) “the defendant actively
conceals a material fact from the plaintiff,” and (3) “the defendant makes
partial representations but also suppresses some material facts.” (Bigler-Engler
v. Breg, Inc. (2017) 7 Cal.App.5th 276, 311.) These three circumstances assume
the existence of some other relationship between the plaintiff and defendant in
which a duty to disclose can arise. (Ibid.)
“Our Supreme Court has described the necessary relationship giving rise
to a duty to disclose as a ‘transaction’ between the plaintiff and defendant ....”
(Bigler-Engler v. Breg, Inc., supra, 7 Cal.App.5th 276 at p. 311.)
The FAC details allegations that plaintiffs
bought the car from defendant’s dealership, that defendant backed the car with
an express warranty, and that defendant’s authorized dealerships are its agents
for purposes of the sale of defendant’s vehicles to consumers. (FAC, ¶¶ 4, 86.)
Courts have found the above to be pleaded sufficiently for a buyer-seller
relationship and hence, a transaction between two parties. (Dhital v. Nissan
North America, Inc., supra, 84 Cal.App.5th 828 at p. 844.)
Therefore, defendant’s demurrer to the fraud
cause of action is overruled on all three grounds.
Finally, the defendant argues that plaintiffs’
claim for punitive damages should be struck from the FAC because there are no
supporting allegations of fraud. However, this court finds that plaintiffs
properly alleged a fraud cause of action. Thus, defendant’s motion to strike punitive
damages is denied.
Accordingly, defendant’s
demurrer is OVERRULED and its motion to strike is DENIED.