Judge Lisa K. Sepe-Wiesenfeld, Case Number: 24SMCV01801, Date: 2025-05-14 Tentative Ruling

Judge: Lisa K. Sepe-Wiesenfeld, Case: 24SMCV01801, Date: 2025-05-14 Tentative Ruling

Defendants Pickford Real Estate, Inc. dba Berkshire Hathaway HomeServices California Properties, Laurence M. Young, and Pickford Escrow Company, Inc.’s Demurrer to Plaintiff’s First Amended Complaint is SUSTAINED with thirty (30) days leave to amend.

Defendants Pickford Real Estate, Inc. dba Berkshire Hathaway HomeServices California Properties, Laurence M. Young, and Pickford Escrow Company, Inc.’s Motion to Strike Plaintiff’s First Amended Complaint is DENIED as MOOT as to paragraph 79 and GRANTED with thirty (30) days leave to amend as to the prayer for exemplary and punitive damages.

Plaintiff Mohammad Elikaee may amend his complaint only as authorized by the Court’s order and may not amend the complaint to add a new party or cause of action without having obtained permission to do so. (Harris v. Wachovia Mortgage, FSB (2010) 185 Cal.App.4th 1018, 1023.)

“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.” (Hinesley v. Oakshade Town Ctr. (2005) 135 Cal.App.4th 289, 294.) The facts constituting the alleged fraud must be alleged factually and specifically as to every element of fraud, as the policy of “liberal construction” of the pleadings will not ordinarily be invoked. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.) To properly allege fraud against a corporation, the plaintiff must plead the names of the persons allegedly making the false representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written. (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 157.)

In the third cause of action, Plaintiff Mohammad Elikaee (“Plaintiff”) alleges that Defendants Pickford Real Estate, Inc. dba Berkshire Hathaway HomeServices California Properties, Laurence M. Young, and Pickford Escrow Company, Inc. (“Defendants”) knew that a Real Estate Agreement had been signed with another buyer, and escrow was opened prior to entering into the agreement and opening escrow with Plaintiff, but they concealed such facts from Plaintiff and opened a second escrow, which caused Plaintiff to forgo other real estate purchases. (First Am. Compl. ¶¶ 71-76.) First, while Plaintiff alleges this claim against all defendants, there are no allegations within the body of the cause of action as to any conduct by Defendant Young. Second, Plaintiff fails to allege any specific conduct as to either corporate defendant about the names of the persons allegedly making any false representations, their authority to speak, what they said or wrote, and when it was said or written. Accordingly, Defendants’ demurrer to the third cause of action is SUSTAINED with thirty (30) days leave to amend.

“A breach of the implied covenant of good faith and fair dealing involves something beyond breach of the contractual duty itself and it has been held that bad faith implies unfair dealing rather than mistaken judgment.” (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1394.) “If the allegations do not go beyond the statement of a mere contract breach and, relying on the same alleged acts, simply seek the same damages or other relief already claimed in a companion contract cause of action, they may be disregarded as superfluous as no additional claim is actually stated . . . [T]he only justification for asserting a separate cause of action for breach of the implied covenant is to obtain a tort recovery.” (Id. at pp. 1394-1395.) To recover in tort for breach of the implied covenant, the defendant must “have acted unreasonably or without proper cause.” (Id. at p. 1395, citations and italics omitted.)

In the fifth cause of action, Plaintiff alleges that Defendants failed to act in good faith or deal fairly with Plaintiff by secretly hiding the fact that a third party had agreed to purchase the property while signing a new agreement with Plaintiff. (First Am. Compl. ¶ 92.) The nature of the underlying duty owed to Plaintiff is not clear, as he states that it is based on contractual obligations (First Am. Compl. ¶ 90), but there are no further allegations to this effect. Thus, Defendants’ demurrer to the fifth cause of action is SUSTAINED with thirty (30) days leave to amend.

Punitive damages may be recovered upon a proper showing of malice, fraud, or oppression. (Civ. Code, § 3294, subd. (a).) “Malice” is defined as conduct intended to cause injury to a person or despicable conduct carried on with a willful and conscious disregard for the rights or safety of others. (Turman v. Turning Point of Cent. Cal., Inc. (2010) 191 Cal.App.4th 53, 63.) “Oppression” means despicable conduct subjecting a person to cruel and unjust hardship, in conscious disregard of the person’s rights. (Ibid.) “Fraud” is an intentional misrepresentation, deceit, or concealment of a material fact known by defendant, with intent to deprive a person of property, rights or otherwise cause injury. (Ibid.) Conclusory allegations, devoid of any factual assertions, are insufficient to support a conclusion that parties acted with oppression, fraud, or malice. (Smith v. Superior Court (1992) 10 Cal.App.4th 1033, 1042.)

Insofar as Plaintiff seeks to strike paragraph 79, that motion is DENIED as MOOT based on the Court’s ruling above. As to the prayer for exemplary and punitive damages, the basis for such damages is unclear given the Court’s ruling on demurrer. Accordingly, Defendants Pickford Real Estate, Inc. dba Berkshire Hathaway HomeServices California Properties, Laurence M. Young, and Pickford Escrow Company, Inc.’s Motion to Strike Plaintiff’s First Amended Complaint is DENIED as MOOT as to paragraph 79 and GRANTED with thirty (30) days leave to amend as to the prayer for exemplary and punitive damages.