Judge Lisa K. Sepe-Wiesenfeld, Case Number: 24SMCV01175, Date: 2025-01-10 Tentative Ruling

Judge: Lisa K. Sepe-Wiesenfeld, Case: 24SMCV01175, Date: 2025-01-10 Tentative Ruling

Prior to filing a demurrer or a motion to strike, the demurring or moving party is required to meet and confer in person, by telephone, or by videoconference with the party who filed the pleading demurred to or the pleading that is subject to the motion to strike for the purposes of determining whether an agreement can be reached through a filing of an amended pleading that would resolve the objections to be raised in the demurrer. (Code Civ. Proc., §§ 430.41 and 435.5.)

Here, Cross-Defendants Uncommon Builders LLC and Leon Benrimon’s counsel, Christopher K. Trembley attests to sending a meet and confer letter via email to Defendant/Cross-Complainant Precision Design & Build, Inc.’s counsel, Robert G. Klein regarding their objections to the Cross-Complaint. (Trembley Decl., ¶2, Ex. A.) Mr. Trembley further attests to receiving a response to the meet and confer letter from Mr. Klein. (Id. at ¶3, Ex. B.) However, there is no indication that Mr. Trembley attempted to meet and confer in person, by telephone, or videoconference as required by the Code of Civil Procedure Section 430.41 and 435.5. As such, the Court finds that Mr. Trembley’s meet and confer efforts are insufficient. Nonetheless, determination that the meet and confer process was insufficient is not grounds to overrule or sustain a demurrer nor to grant or deny a motion to strike. (Code Civ. Proc., §§ 430.41, subd. (a)(4) and 435.5, subd. (a)(4).)

“A demurrer tests the legal sufficiency of the factual allegations in a complaint.” (Ivanoff v. Bank of America, N.A.(2017) 9 Cal.App.5th 719, 725.) The Court looks to whether “the complaint alleges facts sufficient to state a cause of action or discloses a complete defense.” (Id.) The Court does not “read passages from a complaint in isolation; in reviewing a ruling on a demurrer, we read the complaint ‘as a whole and its parts in their context.’ [Citation.]” (West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 804.) The Court “assume[s] the truth of the properly pleaded factual allegations, facts that reasonably can be inferred from those expressly pleaded and matters of which judicial notice has been taken.” (Harris, supra, 56 Cal.4th p. 240.) “The court does not, however, assume the truth of contentions, deductions or conclusions of law. [Citation.]” (Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1358.)

A general demurrer may be brought under Code of Civil Procedure section 430.10, subdivision (e) if insufficient facts are stated to support the cause of action asserted or under section 430.10, subdivision (a), where the court has no jurisdiction of the subject of the cause of action alleged in the pleading. All other grounds listed in Section 430.10, including uncertainty under subdivision (f), are special demurrers. Special demurrers are not allowed in limited jurisdiction courts. (Code Civ. Proc., § 92, subd. (c).)

Cross-Defendants Uncommon Builders LLC and Leon Benrimon (“Cross-Defendants”) demur to the second cause of action of the cross-complaint on the grounds that the Cross-Complaint fails to state facts sufficient to constitute a cause of action against Cross-Defendants. Specifically, Cross-Defendants argue they are not strangers to the contract but rather were construction managers/agents of Cross-Defendant 144 Monovale LLC, who hired Defendant/Cross-Complainant Precision Design & Build, Inc. (“Precision”) pursuant to the contract at issue.

“To prevail on a cause of action for intentional interference with contractual relations, a plaintiff must plead and prove (1) the existence of a valid contract between the plaintiff and a third party; (2) the defendant’s knowledge of that contract; (3) the defendant’s intentional acts designed to induce a breach or disruption of the contractual relationship; (4) actual breach or disruption of the contractual relationship; and (5) resulting damage.” (Reeves v. Hanlon (2004) 33 Cal.4th 1140, 1148.) “To establish the claim, the plaintiff need not prove that a defendant acted with the primary purpose of disrupting the contract, but must show the defendant’s knowledge that the interference was certain or substantially certain to occur as a result of his or her action.” (Id.)

Here, the Cross-Complaint alleges Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC entered into a first written contract for construction services at the property located at (the “Property”) for $81,200.00 for remodeling the main house. (Cross-Compl., ¶¶10, 33, Ex. 1.) The Cross-Complaint further alleges that Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC entered into a second written contract for construction services at the Property for $168,000.00 for remodeling the guest house. (Id. at ¶¶11, 33, Ex. 2.) The Cross-Complaint further alleges that Cross-Defendant Jason Larian gave Precision change orders totaling $644,108.72 for additional work bringing the contract amount to $893,308.72. (Id. at ¶13.) Such allegations raise a reasonable inference that a valid contract existed between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC. However, there are no facts alleged in the Cross-Complaint to suggest that Cross-Defendants were parties to the two purported contracts. (See Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 514 holding “the tort cause of action for interference with contract does not lie against a party to the contract.”) To the extent Cross-Defendants argue they are not strangers to the contract, such argument is better suited on a summary judgment motion not a demurrer, which only tests the sufficiency of the pleadings.

Moreover, the Cross-Complaint alleges that Cross-Defendants knew of the written contracts between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC because Cross-Defendant Benrimon was heard saying that Isaac Larian was angry that the Property project was over-budget. (Cross-Compl., ¶34.) The Cross-Complaint also alleges that in or about September 2023, Cross-Defendant Benrimon met with Cross-Defendant Jason Larian and falsely represented that Precision was furnishing defective and substandard work, causing harm to the Property and of other trades and work-in-place, failing to pay their suppliers and subcontractors, failing to perform the work in a workmanlike manner, and overbilling for work not performed. (Id. at ¶36.) These allegations if taken as true are sufficient to support a reasonable inference that Cross-Defendants were not parties to the two written contracts but had knowledge of the contracts. A reasonable jury could also infer that Cross-Defendant Benrimon’s act of telling Cross-Defendant Jason Larian that Precision was furnishing defective work, failing to pay suppliers, etc. was intentionally done to disrupt the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC. On the other hand, the Cross-Complaint fails to allege any false representations by Plaintiff/Cross-Defendant Uncommon Builders LLC’s officer, director, or managing agent that interfered with the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC.

Additionally, the Cross-Complaint alleges that Cross-Defendants false representation to Cross-Defendant Jason Larian caused him to cancel the contract with Precision on December 6, 2023. (Cross-Compl., ¶39.) The Cross-Complaint further alleges that Precision suffered damages in the amount of $82,649.20 as a result of the induced breach of contract due to Cross-Defendants’ conduct. (Id. at ¶42.) Reading these allegations as true, a reasonable jury could infer that Cross-Defendant Benrimon’s conduct caused an actual breach of the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC. A reasonable jury could also infer that Precision suffered actual damages as a result of the breach of contracts. By contrast, the Cross-Complaint fails to allege any conduct by Cross-Defendant Uncommon Builders LLC’s officer, director, or managing agent that caused the actual breach of the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC.

Cross-Defendants Uncommon Builders LLC and Leon Benrimon (“Cross-Defendants”) also move for an order striking portions of the Cross-Complaint relating to Precision’s request for punitive damages and attorney fees. Specifically, Cross-Defendants argue that the allegations in the Cross-Complaint are vague, conclusory, and lack specificity required to support a request for punitive damages. Likewise, Cross-Defendants argue the Cross-Complaint fails to plead any statutory or contractual basis which would entitle Precision to recovery of attorneys’ fees and is silent as to whom Precision seeks attorneys’ fees against.

Malice is defined as either “conduct which is intended by the defendant to cause injury to the plaintiff,” or “despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.” (Civ. Code, § 3294, subd. (c)(1).) “Despicable conduct is conduct which is so vile, base, contemptible, miserable, wretched or loathsome that it would be looked down upon and despised by ordinary decent people.” (Mock v. Michigan Millers Mutual Ins. Co. (1992) 4 Cal. App. 4th 306, 331.) Fraud under California Civil Code Section 3294, subdivision (c)(3) “means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.” (Civ. Code, § 3294, subd. (c)(3).) The California Civil Code Section 3294, subdivision (2) defines oppression as “despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” (Civ. Code, § 3294, subd. (2).)

Punitive damages thus require more than the mere commission of a tort. (Taylor v. Superior Court (1979) 24 Cal.3d 890, 894-95.) Specific facts must be pled in support of punitive damages. (Hillard v. A.H. Robins Co. (1983) 148 Cal.App.3d 374, 391-392.) A “conclusory characterization of [a] defendant’s conduct as intentional, wilful and fraudulent [is] [a] patently insufficient statement of oppression, fraud, or malice.” (Brousseau v. Jarrett (1977) 73 Cal.App.3d 864, 865.) Facts must be pled to show that a defendant “act[ed] with the intent to vex, injure or annoy, or with a conscious disregard of the plaintiff’s rights.” (Silberg v. California Life Ins. Co. (1974) 11 Cal.3d 452, 462.) “When nondeliberate injury is charged, allegations that the defendant’s conduct was wrongful, willful, wanton, reckless or unlawful do not support a claim for exemplary damages; such allegations do not charge malice.” (G.D. Searle & Co. v. Superior Court (1975) 49 Cal.App.3d 22, 29.) Conduct that is merely negligent will not support a claim for punitive damages. (Tomaselli v. Transamerica Ins. Co. (1994) 25 Cal.App.4th 1269, 1288.)

However, “An employer shall not be liable for damages pursuant to subdivision (a), based upon acts of an employee of the employer, unless the employer had advance knowledge of the unfitness of the employee and employed him or her with a conscious disregard of the rights or safety of others or authorized or ratified the wrongful conduct for which the damages are awarded or was personally guilty of oppression, fraud, or malice. With respect to a corporate employer, the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud, or malice must be on the part of an officer, director, or managing agent of the corporation.” (Civ. Code § 3294, subd. (b) (emphasis added).)

Here, the Court finds that the Cross-Complaint alleges sufficient facts to support a request for punitive damages as to Cross-Defendant Benrimon but not as to Plaintiff/Cross-Defendant Uncommon Builders LLC. The Cross-Complaint alleges that in or about September 2023, Cross-Defendant Benrimon met with Cross-Defendant Jason Larian and falsely represented that Precision was furnishing defective and substandard work, causing harm to the Property and of other trades and work-in-place, failing to pay their suppliers and subcontractors, failing to perform the work in a workmanlike manner, and overbilling for work not performed. (Cross-Compl., ¶36.) The Cross-Complaint further alleges that Cross-Defendants false representation to Cross-Defendant Jason Larian caused him to cancel the contract with Precision on December 6, 2023. (Id. at ¶39.) The Cross-Complaint further alleges that Precision suffered damages in the amount of $82,649.20 as a result of the induced breach of contract due to Cross-Defendants’ conduct. (Id. at ¶42.) Reading these allegations as true, a reasonable jury could infer that Cross-Defendant Benrimon’s act of falsely representing to Cross-Defendant Jason Larian that Precision was furnishing defective work, failing to pay suppliers, etc. was intentionally done to disrupt the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC. A reasonable jury could also infer that Cross-Defendant Benrimon’s conduct caused an actual breach of the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC, and resulted in damages to Precision. On the other hand, the Cross-Complaint fails to allege any false misrepresentations by Plaintiff/Cross-Defendant Uncommon Builders LLC through an officer, director, or managing agent that interfered with the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC. Similarly, the Cross-Complaint fails to allege any conduct by Cross-Defendant Uncommon Builders LLC that caused the actual breach of the contractual relationship between Precision, Cross-Defendant Jason Larian, and Cross-Defendant 144 Monovale LLC.

As to the request for attorneys’ fees, the Cross-Complaint as currently plead is insufficient to support such a request. First, the Cross-Complaint is silent as to from whom Precision seeks to recover attorneys’ fees. Second, the Cross-Complaint does not allege any statutory or contractual basis for recovering the requested attorneys’ fees. In opposition, Precision asserts that the “tort of another” doctrine could allow it to recover attorneys’ fees. “The tort of another doctrine holds that ‘[a] person who through the tort of another has been required to act in the protection of his interests by bringing or defending an action against a third person is entitled to recover compensation for the reasonably necessary loss of time, attorney's fees, and other expenditures thereby suffered or incurred.’ ” (Mega RV Corp. v. HWH Corp. (2014) 225 Cal.App.4th 1318, 1337, as modified on denial of reh'g (May 20, 2014).) However, the Cross-Complaint makes no mention of this doctrine to support the request for attorneys’ fees.