Judge Marcella O. Mclaughlin, Case 37-2023-00015474-CU-BC-CTL 2024-02-16 Tentative Ruling

Judge: Marcella O. Mclaughlin, Case: 37-2023-00015474-CU-BC-CTL, Date: 2024-02-16 Tentative Ruling

SUPERIOR COURT OF CALIFORNIA,

DEPT.:

EVENT DATE:

EVENT TIME:

HALL OF JUSTICE

TENTATIVE RULINGS - February 15, 2024

02/16/2024 01:30:00 PM C-72 COUNTY OF SAN DIEGO

JUDICIAL OFFICER:Marcella O McLaughlin

CASE NO.:

CASE CATEGORY:

EVENT TYPE:

CASE TITLE: CASE TYPE:

Civil - Unlimited Breach of Contract/Warranty Demurrer / Motion to Strike 37-2023-00015474-CU-BC-CTL PHILLIPS VS SOLID FOUNDATION LLC [IMAGED] CAUSAL DOCUMENT/DATE FILED: Demurrer, 10/09/2023

A. The demurrer to the FAC is SUSTAINED with leave to amend.

Counts 1 and 2 The demurrer to counts 1 and 2 is sustained with leave to amend.

The statute of limitations is four years for breach of written contract (Code Civ. Proc. § 337(a)) and three years for tortious injury to real property three years (Code Civ. Proc. § 338(b)). 'A statute of limitations is triggered, and thus the legislatively prescribed limitations period begins to run, when a claim 'accrues' – that is, when all elements of the claim have occurred.' Piedmont Capital Management, L.L.C. v. McElfish (2023) 94 Cal.App.5th 961, 968. The 'discovery rule' is an exception to this general rule and postpones accrual of a cause of action until the plaintiff discovers, or has reason to discover, the cause of action. Fox v. Ethicon Endo-Surgery (2005) 35 Cal.4th 797, 807. 'To rely on the discovery rule for delayed accrual of a cause of action, a plaintiff whose complaint shows on its face that his claim would be barred without the benefit of the discovery rule must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence.' Carrillo v. County of Santa Clara (2023) 89 Cal.App.5th 227, 234.

Here, plaintiff alleges that escrow closed on the property in April 2018. (FAC at ¶¶ 1, 18.) Thus, her claims accrued – at the latest – sometime in April 2018. See Piedmont Capital, 94 Cal.App.5th at 968 ('Because the very existence of a contract is what gives rise to the duty to perform, and because damages generally flow from the breach of that duty, the statute of limitations period for most breach of contract claims begins to run when a party breaches that contract.'); see also Wilshire Westwood Associates v. Atlantic Richfield Co. (1993) 20 Cal.App.4th 732, 739 ('[W]hen a party sues for injuries caused by a latent construction defect, the court first determines whether the claim was filed within the limitations period applicable to the claim, and then considers whether the claim was filed more than 10 years after substantial completion of the project.'). Taking into account the tolling period provided by Emergency rule 9, plaintiff had until the end of October 2022 to file her lawsuit. Code Civ. Proc. §§ 337(a), 338(b). She did not do so. The FAC therefore shows on its face that the breach of contract and negligence claims are time-barred.

In an attempt to postpone accrual of these claims, plaintiff alleges as follows: 'Prior to two years from the date this action was filed, Plaintiff did not discover, and did not know of facts that would have caused a reasonable person to suspect, that she had suffered harm caused by the actions of SOLID FOUNDATION and JEFFRIES as alleged herein; alternatively, Plaintiff did not discover, and a Calendar No.: Event ID: TENTATIVE RULINGS

3037763 CASE NUMBER: CASE TITLE: PHILLIPS VS SOLID FOUNDATION LLC [IMAGED] 37-2023-00015474-CU-BC-CTL reasonable and diligent investigation would not have disclosed, that the actions of SOLID FOUNDATION and JEFFRIES as alleged herein contributed to Plaintiff's harm or damage.' (FAC at ¶ 12.) These allegations fail to meet the heightened pleading standards that apply when a plaintiff seeks to rely on the discovery rule. See Carrillo, 89 Cal.App.5th at 234 ('In assessing the sufficiency of the allegations of delayed discovery...[c]onclusory allegations will not withstand demurrer.'). Thus, plaintiff has failed to plead sufficient facts to demonstrate delayed accrual of her breach of contract and negligence claims.

Counts 3 and 4 The demurrer to counts 3 and 4 is sustained with leave to amend.

A three-year statute of limitations governs fraud-based causes of action. Code Civ. Proc. § 338(d). The discovery rule is applied to fraud actions by statute. Id. '[I]f an action is brought more than three years after commission of the fraud, plaintiff has the burden of pleading...that he did not make the discovery until within three years prior to the filing of his complaint.' Hobart v. Hobart Estate Co. (1945) 26 Cal.2d 412, 437. To excuse failure to discover the fraud within three years after its commission, a plaintiff also must plead 'facts showing that he was not negligent in failing to make the discovery sooner and that he had no actual or presumptive knowledge of facts sufficient to put him on inquiry.' Id. 'The discovery related facts should be pleaded in detail to allow the court to determine whether the fraud should have been discovered sooner.' Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1472.

In this case, the alleged fraud occurred not later than the close of escrow in April 2018. Plaintiff filed this action in April 2023 – i.e., five years later – but has failed to plead any facts showing when or how she discovered the fraud. Thus, as currently pled, the concealment and negligent misrepresentation claims are time-barred.

B. The motion to strike portions of the FAC is DENIED as moot in light of the court's ruling on defendants' companion demurrer.

C. 'Liberality in permitting amendment is the rule, if a fair opportunity to correct any defect has not been given.' Angie M. v. Superior Court (1995) 37 Cal.App.4th 1217, 1227. Accordingly, plaintiff is granted leave to amend the FAC. Plaintiff must file and serve the second amended complaint by February 26, 2024.

Calendar No.: Event ID: TENTATIVE RULINGS

3037763