Judge: Lisa K. Sepe-Wiesenfeld, Case: 24SMCV01151, Date: 2025-03-27 Tentative Ruling

Case Number: 24SMCV01151    Hearing Date: March 27, 2025    Dept: N

REASONING

The court may, upon motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading. (Code Civ. Proc., § 436, subd. (a).) The court may also strike all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court. (Code Civ. Proc., § 436, subd. (b).) The grounds for a motion to strike are that 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.)

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 [court shall not “sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment”]; Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037 [“A demurrer should not be sustained without leave to amend if the complaint, liberally construed, can state a cause of action under any theory or if there is a reasonable possibility the defect can be cured by amendment.”]; Vaccaro v. Kaiman (1998) 63 Cal.App.4th 761, 768 [“When the defect which justifies striking a complaint is capable of cure, the court should allow leave to amend.”].) The burden is on the complainant to show the Court that a pleading can be amended successfully. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)

Defendant 2500 Briarcrest Road, LLC (“Defendant”) moves to strike Plaintiff Oakhurst Income Fund II, LP (“Plaintiff”)’s prayer for relief in Plaintiff’s First Amended Complaint seeking “attachment of the 2500 Briarcrest Property and any proceeds thereof.” (First Am. Compl., p. 6, l. 4.) Defendant argues that the prayer is improper because Civil Code section 3439.04 and 3439.05 do not allow for the requested attachment of real property and “any proceeds thereof.” Defendant argues that the statutes reference only claims against a debtor, which would be third party Don Caverhill here, not a third party transferee like Defendant.

Plaintiff counters that it has alleged a fraudulent transfer of property. “A fraudulent conveyance is a transfer by the debtor of property to a third person undertaken with the intent to prevent a creditor from reaching that interest to satisfy its claim.” (Nautilus, Inc. v. Yang (2017) 11 Cal.App.5th 33, 40, quotation marks omitted.) The Uniform Voidable Transactions Act, codified at Civil Code section 3439, et seq., provides that a transfer “is voidable as to a creditor, whether the creditor’s claim arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation as follows: (1) With actual intent to hinder, delay, or defraud any creditor of the debtor. [¶] (2) Without receiving a reasonably equivalent value in exchange for the transfer or obligation, and the debtor either: [¶] (A) Was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction. [¶] (B) Intended to incur, or believed or reasonably should have believed that the debtor would incur, debts beyond the debtor’s ability to pay as they became due.” (Civ. Code, § 3439.04, subd. (a).)

Plaintiff cites to Civil Code section 3439.07, subdivision (a)(2), which allows attachment against the asset transferred. Civil Code section 3439.07, subdivision (b), provides that an asset may be attached if a creditor like Plaintiff has commenced an action on a claim against the debtor, which, here, may be Defendant given the transfer of property. In other words, there are no allegations in the complaint that Defendant Don Caverhill alone is the debtor, i.e., Defendant may also be a debtor, and this is a question of fact that must be determined at a later juncture. Put simply, the First Amended Complaint does not establish that Defendant is not a debtor, and the Court makes no findings here as to Plaintiff’s ability to obtain attachment at a later juncture. For that reason, Defendant 2500 Briarcrest Road, LLC’s Motion to Strike Portions of First Amended Complaint is DENIED. Defendant 2500 Briarcrest Road, LLC shall file and serve an answer to Plaintiff Oakhurst Income Fund II, LP’s First Amended Complaint within ten (10) days of entry of this order. (Cal. Rules of Court, rule 3.1320(j).)