Judge Lynette Gridiron Winston, Case Number: 23PSCV01346, Date: 2024-01-16 Tentative Ruling

Judge: Lynette Gridiron Winston, Case: 23PSCV01346, Date: 2024-01-16 Tentative Ruling

Case Number: 23PSCV01346 Hearing Date: January 16, 2024 Dept: 6

CASE NAME: Maria de Jesus Preciado v. General Motors LLC

General Motors LLC’s Demurrer to Plaintiff’s First Amended Complaint

TENTATIVE RULING

The Court SUSTAINS the demurrer to the First Amended Complaint with leave to amend. The Court also GRANTS the motion to strike with leave to amend. Plaintiff must file and serve the Second Amended Complaint within 20 days of the Court’s order, and then Defendant must file a responsive pleading per statute. Alternatively, if Plaintiff does not file and serve the Second Amended Complaint within 20 days of the Court’s order, Defendant must file and serve an Answer to the remaining causes of action in the First Amended Complaint within 30 days of the Court’s order.

Defendant is ordered to give notice of the Court’s ruling within five calendar days of this order.

BACKGROUND

This is a lemon law case. On May 3, 2023, plaintiff Maria de Jesus Preciado (Plaintiff) filed this action against defendant General Motors LLC (Defendant) and Does 1 through 10, alleging causes of action for breach of express warranty, breach of implied warranty, violation of the Song-Beverly Act section 1793.2, and fraud (fraudulent inducement – concealment). On September 7, 2023, Plaintiff filed the operative First Amended Complaint (FAC) alleging the same causes of action.

On October 4, 2023, Defendant filed a demurrer to the fourth cause of action in the FAC and a motion to strike the FAC’s request for punitive damages. The motions are unopposed.

LEGAL STANDARD – Demurrer

A demurrer is a pleading used to test the legal sufficiency of other pleadings. It raises issues of law, not fact, regarding the form or content of the opposing party's pleading (complaint, answer or cross-complaint). (Code Civ. Proc., § 422.10; see Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) It is not the function of the demurrer to challenge the truthfulness of the complaint; and for purposes of ruling on the demurrer, all facts pleaded in the complaint are assumed to be true. (Id.)

A demurrer can be used only to challenge defects that appear on the face of the pleading under attack, or from matters outside the pleading that are judicially noticeable. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian, supra, 116 Cal.App.4th at p. 994.) No other extrinsic evidence may be considered. (Ion Equip. Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881 [error for court to consider facts asserted in memorandum supporting demurrer]; see also Afuso v. United States Fid. & Guar. Co. (1985) 169 Cal.App.3d 859, 862, disapproved on other grounds in Moradi-Shalal v. Fireman’s Fund Ins. Cos. (1988) 46 Cal.3d 287 [error to consider contents of release not part of court record].)

A demurrer can be utilized where the “face of the complaint” itself is incomplete or discloses some defense that would bar recovery. (Guardian North Bay, Inc. v. Superior Court (2001) 94 Cal.App.4th 963, 971-972.) The “face of the complaint” includes material contained in attached exhibits that are incorporated by reference into the complaint, or in a superseded complaint in the same action. (Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94; see also Barnett v. Fireman’s Fund Ins. Co. (2001) 90 Cal.App.4th 500, 505 [“[W]e rely on and accept as true the contents of the exhibits and treat as surplusage the pleader’s allegations as to the legal effect of the exhibits.”])

A demurrer can only be sustained when it disposes of an entire cause of action. (Poizner v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 119; Kong v. City of Hawaiian Gardens Redev. Agency (2003) 108 Cal.App.4th 1028, 1046.)

DISCUSSION - Demurrer

Meet and Confer

Per Code of Civil Procedure section 430.41, subdivision (a), Defendant was required to meet and confer in person or by telephone before bringing the demurrer. (Code Civ. Proc., § 430.41, subd. (a).) The Court finds Defendant’s meet-and-confer efforts to be adequate. (Valencia Decl., ¶ 3.)

Analysis

To plead a cause of action for fraudulent misrepresentation, the plaintiff must allege facts demonstrating, “(1) the defendant represented to the plaintiff that an important fact was true; (2) that representation was false; (3) the defendant knew that the representation was false when the defendant made it, or the defendant made the representation recklessly and without regard for its truth; (4) the defendant intended that the plaintiff rely on the representation; (5) the plaintiff reasonably relied on the representation; (6) the plaintiff was harmed; and (7) the plaintiff's reliance on the defendant's representation was a substantial factor in causing that harm to the plaintiff. [Citation.]” (Graham v. Bank of Am., N.A. (2014) 226 Cal.App.4th 594, 605-606, internal quotation marks omitted.)

To plead a cause of action for fraudulent concealment, the plaintiff must allege facts demonstrating, “(1) concealment or suppression of a material fact; (2) by a defendant with a duty to disclose the fact to the plaintiff; (3) the defendant intended to defraud the plaintiff by intentionally concealing or suppressing the fact; (4) the plaintiff was unaware of the fact and would not have acted as he or she did if he or she had known of the concealed or suppressed fact; and (5) plaintiff sustained damage as a result of the concealment or suppression of the fact. [Citation.]” (Hambrick v. Healthcare Partners Med. Grp., Inc. (2015) 238 Cal.App.4th 124, 162.)

Defendant demurs to the fourth cause of action for fraudulent misrepresentation/fraudulent concealment on the grounds that the FAC fails to state a viable claim for fraud by omission, that the concealment allegations are insufficient as a matter of law, the FAC fails to allege fraud with the requisite specificity, and that fraud cannot be based on non-actionable puffery. With respect to fraud by omission, Defendant contends that the FAC does not allege a specific omission by Defendant or the details surrounding any such omission, such as: (1) whether Plaintiff communicated with Defendant before purchasing the subject vehicle; (2) whether the purported defect was covered under the warranty; (3) what alleged representations were made to Plaintiff; (4) how the subject vehicle does not allegedly conform to its intended use; (5) how Defendant failed to repurchase or replace the subject vehicle; (6) how Defendant owed a duty to Plaintiff; and (7) what facts support Plaintiff’s allegation that the subject vehicle is unsafe or ever exhibited a safety concern. Defendant contends the allegations of the FAC in regard to this matter are conclusory.

With respect to the FAC’s concealment allegations being insufficient as a matter of law, Defendant contends that there is no allegation that Defendant was aware of any material fact that allegedly impacted the subject vehicle’s safety at the time of the purchase or that Plaintiff had any direct contact with Defendant at the time of purchase. Defendant further contends it did not have a duty to disclose either, as there was no fiduciary relationship between Plaintiff and Defendant, and Defendant is not liable for the independent conduct of a dealership employee.

With respect to the FAC’s failure to allege fraud with the requisite specificity, Defendant contends the FAC fails to identify the manager or consultant with whom Plaintiff spoke when leasing the subject vehicle, when Plaintiff had any such conversations, or what advertisements or marketing materials Plaintiff reviewed or relied upon in purchasing[1] the subject vehicle. Defendant contends the allegations here are otherwise conclusory.

Finally, with respect to non-actionable puffery, Defendant contends the FAC does not allege what statements Plaintiff might have relied on from Defendant. Defendant contends that, to the extent Plaintiff may have relied on some unspecified statement, it was nothing more than puffery, which is not actionable.

The Court finds that the fourth cause of action for fraudulent misrepresentation/fraudulent concealment is subject to demurrer. The FAC fails to allege facts demonstrating that the sales representative at the dealership was authorized to make any statements or representations on behalf of Defendant. (Avalon Painting Co. v. Alert Lumber Co. (1965) 234 Cal.App.2d 178, 184 [a dealer or retailer is not an agent of the manufacturer].) While the FAC does allege that there was an agency relationship between Defendant and the auto dealer in this matter, (See, e.g., FAC, ¶¶ 5, 8), the Court finds such allegations to be conclusory and unsupported by facts elsewhere in the FAC, and therefore disregards them. (Wexler v. California Fair Plan Association (2021) 63 Cal.App.5th 55, 70).

The Court also finds the FAC fails to allege facts with the specificity required for fraud claims. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.) The FAC does not allege the name of the sales representative with whom Plaintiff purportedly spoke or their authority to speak, which is particularly important when alleging fraudulent misrepresentations made on behalf of a corporation. (See Id.; Mason v. Drug, Inc. (1939) 31 Cal.App.2d 697, 703 [“if the plaintiff would charge the defendant corporation with making fraudulent misrepresentations it was necessary for him to allege the name of the person who spoke, his authority to speak, to whom he spoke, what he said or wrote, and when it was said or written.”])

The Court further finds the FAC fails to allege facts demonstrating that Defendant was in a relationship with Plaintiff that required Defendant to disclose information for purposes of a fraudulent concealment claim.

There are ‘four circumstances in which nondisclosure or concealment may constitute actionable fraud: (1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material facts...’

Each of the [non-fiduciary relationship] circumstances in which nondisclosure may be actionable presupposes the existence of some other relationship between the plaintiff and defendant in which a duty to disclose can arise…

As a matter of common sense, such a relationship can only come into being as a result of some sort of transaction between the parties. [Citations.]

(LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336, italics in original and internal citations omitted; see also Shin v. Kong (2000) 80 Cal.App.4th 498, 509 [“A duty to disclose facts arises only when the parties are in a relationship that gives rise to the duty, such as ‘seller and buyer, employer and prospective employee, doctor and patient, or parties entering into any kind of contractual agreement.’”])

The FAC does not allege facts demonstrating that Defendant and Plaintiff were in a fiduciary relationship with each other or in any other sort of transactional relationship. The FAC does not allege that Defendant sold the subject vehicle to Plaintiff or that the parties directly entered into a contract with each other. The FAC also does not allege facts showing that Defendant had exclusive knowledge for purposes of concealment, or that Defendant actively concealed information from Plaintiff or made partial representations to Plaintiff.

Finally, the Court construes Plaintiff’s lack of opposition to the demurrer as a tacit admission that it is meritorious. (Holden v. City of San Diego (2019) 43 Cal.App.5th 404, 418; C. Opposing the Motion—and Rebutting the Opposition, Cal. Prac. Guide Civ. Pro. Before Trial Ch. 9(I)-C, ¶ 9:105.10.)

Based on the foregoing, the Court SUSTAINS the demurrer to the fourth cause of action with leave to amend.

LEGAL STANDARD – Motion to Strike

“Any party, within the time allowed to respond to a pleading may serve and file a notice of motion to strike the whole or any part thereof, but this time limitation shall not apply to motions specified in subdivision (e).” (Code Civ. Proc., § 435, subd. (b)(2).) “The court may, upon a motion made pursuant to Section 435, or at any time in its discretion, and upon terms it deems proper: (a) Strike out any irrelevant, false, or improper matter inserted in any pleading. (b) Strike out 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.” (Id., § 436.)

DISCUSSION – Motion to Strike

Meet and Confer

Per Code of Civil Procedure section 435.5, subdivision (a), Defendant was required to meet and confer telephonically or in person before bringing this motion to strike. (Code Civ. Proc., § 435.5, subd. (a).) The Court finds Defendant’s meet-and-confer efforts to be adequate. (Valencia Decl., ¶ 3.)

Analysis

Defendant seeks to strike item 6 from the prayer for relief of the FAC, which is Plaintiff’s request for punitive damages. In light of the Court sustaining the demurrer with leave to amend as to the fourth cause of action for fraudulent misrepresentation/fraudulent concealment, the Court further finds the FAC has not alleged a cause of action that provides for punitive damages. (See Civ. Code § 3294, subd. (a); Id. § 1794; Anderson v. Ford Motor Co. (2022) 74 Cal.App.5th 946, 963-964 [punitive damages available for other causes of action based on different conduct in connection with lemon law case].) The Court also construes Plaintiff’s lack of opposition to the motion to strike as a tacit admission that it is meritorious. (Holden v. City of San Diego (2019) 43 Cal.App.5th 404, 418; C. Opposing the Motion—and Rebutting the Opposition, Cal. Prac. Guide Civ. Pro. Before Trial Ch. 9(I)-C, ¶ 9:105.10.)

Based on the foregoing, the Court GRANTS the motion to strike with leave to amend.

CONCLUSION

Defendant is ordered to give notice of the Court’s ruling within five calendar days of this order.

[1] The Court presumes Defendant meant to say “leasing”. (Demurrer, 11:27-12:3.)