Judge: Margaret L. Oldendorf, Case: 22BBCV00172, Date: 2023-08-14 Tentative Ruling
Case Number: 22BBCV00172 Hearing Date: August 14, 2023 Dept: P
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES
NORTHEAST DISTRICT
I.
INTRODUCTION
Plaintiff Tamazi Gogadze purchased
certain commercial real property from the LA County Tax Assessor at auction. The
property has been subject to abatement orders from Defendant State of
California Department of Toxic Substances Control (DTSC), stemming from its
prior use as a metal plating business.
The gist of the pleading is that
Gogadze could not obtain title insurance for the property, and lost several
opportunities to sell the property because there was a lien on the property;
and because DTSC employees, including Defendant Patrick Movlay, told Plaintiff
(and at least one prospective buyer) that anyone who owns the property must
enter into a 30-year Operations and Maintenance Agreement for monitoring the
groundwater aquifer, and prepay hundreds of thousands of dollars for monitoring
costs. Plaintiff alleges that these statements were false. Gogadze’s First
Amended Complaint contains one cause of action for slander of title.
Defendants’ demurrer to the original
pleading was sustained with leave to amend on the ground that public entity
liability must be based on statute. The First Amended Complaint continues to assert
the single cause of action for slander of title. Gogadze has added allegations that Movlay is
liable for injury caused by his act or omission pursuant to Gov. Code §820; and
that DTSC is derivatively liable pursuant to Gov. Code §815.2. These facts,
along with the matters that may be judicially noticed, fail to state a cause of
action because Movlay’s statements regarding Gogadze’s title were not false.
In addition (as with the previous
version of the Complaint), to the extent slander of title is based on the
recorded judgment lien it is absolutely privileged.
For these reasons, the demurrer to the
First Amended Complaint (FAC) is sustained. It does not appear that amendment
can cure these defects, so the tentative is to deny leave to amend. In light of the ruling on the demurrer, the
motion to strike is taken off calendar.
II. SUMMARY
OF ALLEGATIONS
The is litigation concerns the real property located
at 1102 West Isabel Street in Burbank. DTSC is a public agency organized under
the laws of the State of California. Patrick Movlay is a DTSC employee. (Two
other previously named employees were dropped from the FAC.)
Gogadze purchased the Isabel Street property for
$190,000 on October 21, 2019. Two days later he learned from a title company
representative that DTSC had a lien on the property, which was imposed in
connection with the business activities of the prior owner.
In November 2019, Gogadze spoke to Movlay, and told
him that the lien must be removed immediately so that he could have clear title
and obtain title insurance. Instead of releasing the lien, DTSC thereafter
attempted to get Gogadze to enter into an Operations and Maintenance Agreement.
He refused to sign such an agreement.
In January 2020, Gogadze received an offer to
purchase the property for $1.1 million; the offer was allegedly never
consummated because Gogadze could not remove the lien. Instead of removing the
lien, DTSC allegedly attempted to pressure Gogadze into signing the Operations
and Maintenance agreement. Shortly after that, Gogadze contacted DTSC’s
attorney Robin McGinnis to request that the lien be removed.
In March 2020, Gogadze received an offer to lease
the property for $3,042 per month, which he also allegedly lost because he
could not get DTSC to remove the lien.
From April to June of 2020, Gogadze received offers
to purchase the property for $975,000 and then $700,000. He alleges he lost them for the same reason.
In November 2020, Gogadze received an offer to
purchase the property for $875,000. Again,
this offer allegedly could not be consummated for the same reason.
Paragraph 19 contains Gogadze’s central charging
allegation. It is quoted here in full:
“The potential buyer of the property, Arthur
Aslabekyan telephoned and spoke directly to DTSC employee, defendant Patrick
Movlay, an employee of defendant DTSC, while conducting his due diligence
research. Defendant Movlay told the
potential buyer that, by law, an existing owner and any future owners, must
enter into an Operation and Maintenance Agreement with DTSC and must
prepay hundreds of thousands of dollars in advance to the DTSC because the
water underneath the land in the aqueduct or aquifer that spreads throughout
the Burbank, San Fernando Valley, and Glendale areas, was very bad quality, and
in addition, that the Operations and Maintenance Agreement with DTSC was
required to be recorded with the Los Angeles County Recorder. This statement by Mr. Movlay to Mr.
Aslabekyan, however, was false, and Movlay knew it to be false when he made
it. The statement disparaged the title
to Plaintiff’s Property directly to this potential buyer. Defendant Movlay made the false and
disparaging statement to the buyer, Mr. Aslabekyan, with actual malice because
Mr. Movlay’s intent was to harm Plaintiff Gogadze and his business interests
because Mr. Gogadze was refusing to enter into an Agreement with DTSC. Defendant Movlay was
upset that Plaintiff would not agree to enter into the long term agreement with
DTSC. He wanted Plaintiff to feel
pressured into entering into such the [sic] agreement with the DTSC, and was
trying to hurt Plaintiff’s business interests to the extent that Plaintiff
would give in to the coercive tactics, and then sign the agreement being
proffered by DTSC. Mr. Movlay made the aforementioned
statement with a conscious intent to deceive the potential Buyer so that he
would not purchase the Property. Again,
this was designed to accomplish the goal of coercing Plaintiff into entering a
voluntary agreement with DTSC that was not required by law.”
In January 2021, Gogadze alleges that he received
yet another offer to purchase the property; and that deal was also lost because
the buyer was told by Molvay they would be required to enter into an Operations
and Maintenance Agreement. Plaintiff
alleges this was false, and done to harm Gogadze.
Statutory liability is alleged in ¶¶28 and 29
pursuant to Gov. Code §820 and §815.2.
III. REQUEST
FOR JUDICIAL NOTICE
Code Civ. Proc. §430.30, subdivision (a) provides, “When any
ground for objection to the complaint . . . appears from… matter of
which the court is required to or may take judicial notice, the objection on
that ground may be taken by a demurrer to the pleading.”
Defendants’ request that the Court take judicial
notice of the following documents is granted:
Exhibits 1, 2, and 6, which are records of the Los
Angeles Superior Court. Judicial notice is granted pursuant to Evid. Code §452(d).
- Exhibit 1 is the verified complaint in the prior
action for quiet title, Tamazi Gogadaze v. State of California DTSC, et al.,
21BBCV00264.
- Exhibit 2 is the quiet title judgment in that
action.
- Exhibit 6 is the original complaint in this
action.
As to each of these documents, judicial notice is
taken of the document itself, but not of the truth of any matter stated
therein. Freemont Indemnity Co. v. Freemont General Corp. (2007) 148 Cal.App.4th 97, 113-114; Sosinksy v. Grant (1992) 6 Cal.App.4th
1548, 1564-1569.
Exhibits 3-5 are orders issued by DTSC. Judicial
notice of these documents is granted pursuant to Evid. Code §452(c) -- not as
to any factual findings contained in the orders themselves but as to the legal
effect of the orders. In Rodas v. Spiegel (2001) 87 Cal.App.4th 513, 518,
judicial notice of the decision and order of the Contractors’ State Licensing
Board was appropriate: “We may take judicial notice of ‘[o]fficial acts of the
legislative, executive, and judicial departments of the United States and of
any state of the United States.’ (Evid.Code, § 452, subd. (c).) Official acts
include records, reports and orders of administrative agencies.” In Hogen v.
Valley Hospital (1983) 147 Cal.App.3d 119, judicial notice was taken of the
files of the Board of Medical Quality Assurance. Here, as to Exhibits 3-5, it
is not appropriate to take judicial notice of findings of fact within those
orders. Sosiknsky, supra, 6 Cal.App.4th at 1568: “Taking judicial
notice of the truth of a judge’s factual finding would appear to us to be
tantamount to taking judicial notice that the judge’s factual finding must
necessarily have been correct and that the judge is therefore infallible. We
resist the temptation to do so.”
However, as to Exhibits 3-5, judicial notice is
taken of the orders themselves as legally operative documents. Scott
v. JP Morgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 754: “Where, as
here, judicial notice is requested of a legally operative document -- like
a contract -- the court may take notice not only of the fact of the document
and its recording or publication, but also facts that clearly derive from its legal
effect. (Fontenot, supra, 198 Cal.App.4th at p. 265, 129
Cal.Rptr.3d 467.) Moreover, whether the fact derives from the legal effect of a
document or from a statement within the document, the fact may be judicially
noticed where, as here, the fact is not reasonably subject to dispute.”
(Emphasis in original.)
- Exhibit 3 is an “Imminent and Substantial
Endangerment Order,” dated April 2007.
- Exhibit 4 is a letter dated September 2011 to the
property’s former owner. It informs the owner that DTSC had completed a “Site
Characterization” report for the site, and concluded that no further action for
remediation of the soil is needed if use of the property is limited to
commercial or industrial (not residential or school) use. It also states that
the “implementation of a Land Use Covenant” limiting the property to such use
signed by the owner is required. It also states that an “Operation and Maintenance
Agreement” is required for the proper maintenance and periodic monitoring of
groundwater underneath the site, which is “impacted with tetracholoethene and
tricholoethene.” Also attached are emails concerning this report, in which the former
owner expresses his understanding that a deed restriction is required.
- Exhibit 5 is an “Environmental Compliance Order”
dated December 7, 2020, issued to Gogadze.
IV. THE
DEMURRER IS SUSTAINED
A. Legal Standard
Code
Civ. Proc. §430.10(e) provides for a demurrer on the basis that a complaint
fails to state a cause of action. A demurrer admits, provisionally for purposes
of testing the pleading, all material facts properly pleaded. Tindell v. Murphy (2018) 22 Cal.App.5th
1239, 1247. A demurrer tests the legal sufficiency of a complaint. Donabedian v. Mercury Ins. Co. (2004)
116 Cal.App.4th 968, 994.
B. Slander of Title Cannot Be Alleged on These Facts
Slander of title,
as its name implies, concerns title to property:
“Slander of title is a false and unprivileged
disparagement, oral or written, of the title to real or personal property,
resulting in actual pecuniary damage. . . . The statement is disparaging if it
throws any doubt on the ownership of the property.” 5 Witkin, Summary of Cal. Law
(11th ed.) Torts, §747, bolding added.
“The elements of a cause of action for slander of title are
‘(1) a publication, (2) which is without privilege or justification, (3)
which is false, and (4) which causes direct and immediate pecuniary loss.’ (Manhattan
Loft, LLC v. Mercury Liquors, Inc. (2009) 173 Cal.App.4th 1040, 1051, 93
Cal.Rptr.3d 457, italics added; see also Howard v. Schaniel (1980) 113
Cal.App.3d 256, 263–264, 169 Cal.Rptr. 678.)” Alpha & Omega Development,
LP v. Whillock Contracting, Inc. (2011) 200 Cal.App.4th 656, 664.
According to CACI 1730, the first element of the tort is: “That
[name of defendant] [made a statement/[specify other act, e.g., recorded a
deed] that cast doubts about [name of plaintiff]’s ownership of the property.” The
first case cited in the Directions for Use for CACI 1730 is as follows: “Slander
of title may be either by words or an act that clouds title to the
property,” citing Alpha & Omega Development, LP v. Whillock Contracting,
Inc. (2011) 200 Cal.App.4th 656, 661, bolding added.
In arguing that slander of title does not necessarily
involve title, Gogadze relies on four cases. His argument is unpersuasive,
however, as each of the cases in fact involves title.
M.F. Farming Co. v. Couch Distributing Co., Inc.
(2012) 207 Cal.App.4th 180 involves title to real property. The Court of Appeal
in that case stated: “The slander of
title cause of action alleged that . . . defendant Couch Distributing
published, without privilege or justification, false maps and plot plans that
cast doubt on plaintiff’s title. The cancellation of cloud on title cause of
action alleged that the improperly published documents were false and
fraudulently indicated that defendant Couch Distributing owned the property at
issue and plaintiff MF owned only an easement.” Id. at 187-188.
Gudger v. Munton (1943) 21 Cal.2d 537 concerned enforcement
of a judgment through the recording of a writ of execution on real property. In
that case, a husband’s separate real property was the subject of the writ,
while the judgment involved a premarital judgment against wife alone. The husband
prevailed in his action for quiet title and disparagement of title.
Finch v. Aerospace Corp. v. City of San Diego (2017)
8 Cal.App.5th 1248 concerned title to airport hangars.
Appel v. Burman (1984) 159 Cal.App.3d 1209 involved a
boundary dispute between neighbors. One neighbor had plans to move an existing
boundary fence to correspond to the actual boundary between the properties, and
to have a utility pole moved at the same time. The other neighbor resisted, falsely
telling the power company that the boundary fence was on the actual boundary,
thus disparaging title.
The central issue raised by the demurrer in this case is
whether the FAC alleges sufficient facts demonstrating false and unprivileged disparagement
of Gogadze’s title. At paragraph 19 of the FAC, Gogadze alleges that Movlay’s
statement to prospective buyer Aslabekyan
disparaged his title, because Movlay purportedly told the prospective buyer that
an Operations and Maintenance Agreement with DTSC was required and had to be
recorded with the Los Angeles County Recorder. It is also alleged that Molvay
told the prospective buyer that he would have to prepay hundreds of thousands
of dollars; but it is not clear how that disparages title to the property.
Based on the judicially noticed documents,
including documents evidencing DTSC’s
orders, it is apparent that the property is in fact encumbered by a recorded deed
restriction regarding use of the property (commercial or industrial only), and an
Operations and Maintenance Agreement, which is publicly available on DTSC’s “EnviroStor”
website. Consequently, DTSC argues, Molvay was only making true statements. While
it is alleged that Molvay told the prospective buyer the Operations and
Maintenance Agreement would need to be recorded, which is slightly
different than publicly available, the statement is not false.
Based on the allegations and the
matters of which the Court takes judicial notice, it does not appear that
slander of title has been (or can be) adequately alleged.
C.
The Litigation Privilege Bars Slander of Title as to the Judgment Lien
The litigation privilege applies to recorded judgment liens
which follow and are related to litigation that has already taken place. Weeden
v. Hoffman (2021) 70 Cal.App.5th 269, 288. To the extent Gogadze’s slander
of title claim is based on the recorded judgment lien, the FAC fails to state a
cause of action, as such an act is protected by the litigation privilege.
Gogadze’s opposition brief clarifies that he is not basing
his slander of title claim on the judgment lien. This was not clear from the FAC,
however, or even from Gogadze’s summary of salient allegations at pages 4 and 5
of his opposition -- most of which discuss the lien. However, the Court accepts
Gogadze’s concession that this argument is moot, since he is no longer seeking
relief based on the judgment lien. Opposition at 10:19-22.
As Gogadze’s claim is not tied to the lien, DTSC’s
causation argument is also moot.
D. The Misrepresentation Privilege Does Not Apply
DTSC urges that to the extent Gogadze’s claim is based on
statements Molvay made, Gov. Code §822.2 provides immunity. At least one case
has concluded to the contrary. “[S]lander of title is not a form of deceit. It
is a form of the separate common law tort of disparagement, also sometimes
referred to as injurious falsehood. [fn. 3] (Compare Rest.2d Torts, § 525 with
Rest.2d Torts, §§ 623A, 624; see 3 Dobbs et al., The Law of Torts, supra, §
656, p. 617; see also Hartford, supra, 59 Cal.4th 277, 289–290,
172 Cal.Rptr.3d 653, 326 P.3d 253.) Consequently, the immunities in sections
818.8 and 822.2 do not apply to slander of title. (See Costa Mesa, supra,
214 Cal.App.4th at p. 383, 154 Cal.Rptr.3d 698.)” Finch, supra, 8
Cal.App.5th at 1253.
V. MOTION
TO STRIKE
Code Civ. Proc. §436 permits courts to
strike any irrelevant, false, or improper matter inserted in a pleading. Here,
with the sustaining of the demurrer, there is no operative pleading from which
anything may be stricken. The motion to strike is therefore denied as moot.
VI. CONCLUSION
AND ORDER
The demurrer is sustained on the ground that, based on the
facts alleged and those that are judicially noticed, slander of title cannot be
successfully alleged because Molvay’s statements were true. Leave to amend is denied.
The motion to strike is denied as moot.
Defendants are ordered to give notice of this ruling, and
to lodge forthwith a proposed judgment of dismissal.
Dated: _______________________________
MARGARET L. OLDENDORF
JUDGE
OF THE SUPERIOR COURT
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES
NORTHEAST DISTRICT
I.
INTRODUCTION
Plaintiff Tamazi Gogadze purchased
certain commercial real property from the LA County Tax Assessor at auction. The
property has been subject to abatement orders from Defendant State of
California Department of Toxic Substances Control (DTSC), stemming from its
prior use as a metal plating business.
The gist of the pleading is that
Gogadze could not obtain title insurance for the property, and lost several
opportunities to sell the property because there was a lien on the property;
and because DTSC employees, including Defendant Patrick Movlay, told Plaintiff
(and at least one prospective buyer) that anyone who owns the property must
enter into a 30-year Operations and Maintenance Agreement for monitoring the
groundwater aquifer, and prepay hundreds of thousands of dollars for monitoring
costs. Plaintiff alleges that these statements were false. Gogadze’s First
Amended Complaint contains one cause of action for slander of title.
Defendants’ demurrer to the original
pleading was sustained with leave to amend on the ground that public entity
liability must be based on statute. The First Amended Complaint continues to assert
the single cause of action for slander of title. Gogadze has added allegations that Movlay is
liable for injury caused by his act or omission pursuant to Gov. Code §820; and
that DTSC is derivatively liable pursuant to Gov. Code §815.2. These facts,
along with the matters that may be judicially noticed, fail to state a cause of
action because Movlay’s statements regarding Gogadze’s title were not false.
In addition (as with the previous
version of the Complaint), to the extent slander of title is based on the
recorded judgment lien it is absolutely privileged.
For these reasons, the demurrer to the
First Amended Complaint (FAC) is sustained. It does not appear that amendment
can cure these defects, so the tentative is to deny leave to amend. In light of the ruling on the demurrer, the
motion to strike is taken off calendar.
II. SUMMARY
OF ALLEGATIONS
The is litigation concerns the real property located
at 1102 West Isabel Street in Burbank. DTSC is a public agency organized under
the laws of the State of California. Patrick Movlay is a DTSC employee. (Two
other previously named employees were dropped from the FAC.)
Gogadze purchased the Isabel Street property for
$190,000 on October 21, 2019. Two days later he learned from a title company
representative that DTSC had a lien on the property, which was imposed in
connection with the business activities of the prior owner.
In November 2019, Gogadze spoke to Movlay, and told
him that the lien must be removed immediately so that he could have clear title
and obtain title insurance. Instead of releasing the lien, DTSC thereafter
attempted to get Gogadze to enter into an Operations and Maintenance Agreement.
He refused to sign such an agreement.
In January 2020, Gogadze received an offer to
purchase the property for $1.1 million; the offer was allegedly never
consummated because Gogadze could not remove the lien. Instead of removing the
lien, DTSC allegedly attempted to pressure Gogadze into signing the Operations
and Maintenance agreement. Shortly after that, Gogadze contacted DTSC’s
attorney Robin McGinnis to request that the lien be removed.
In March 2020, Gogadze received an offer to lease
the property for $3,042 per month, which he also allegedly lost because he
could not get DTSC to remove the lien.
From April to June of 2020, Gogadze received offers
to purchase the property for $975,000 and then $700,000. He alleges he lost them for the same reason.
In November 2020, Gogadze received an offer to
purchase the property for $875,000. Again,
this offer allegedly could not be consummated for the same reason.
Paragraph 19 contains Gogadze’s central charging
allegation. It is quoted here in full:
“The potential buyer of the property, Arthur
Aslabekyan telephoned and spoke directly to DTSC employee, defendant Patrick
Movlay, an employee of defendant DTSC, while conducting his due diligence
research. Defendant Movlay told the
potential buyer that, by law, an existing owner and any future owners, must
enter into an Operation and Maintenance Agreement with DTSC and must
prepay hundreds of thousands of dollars in advance to the DTSC because the
water underneath the land in the aqueduct or aquifer that spreads throughout
the Burbank, San Fernando Valley, and Glendale areas, was very bad quality, and
in addition, that the Operations and Maintenance Agreement with DTSC was
required to be recorded with the Los Angeles County Recorder. This statement by Mr. Movlay to Mr.
Aslabekyan, however, was false, and Movlay knew it to be false when he made
it. The statement disparaged the title
to Plaintiff’s Property directly to this potential buyer. Defendant Movlay made the false and
disparaging statement to the buyer, Mr. Aslabekyan, with actual malice because
Mr. Movlay’s intent was to harm Plaintiff Gogadze and his business interests
because Mr. Gogadze was refusing to enter into an Agreement with DTSC. Defendant Movlay was
upset that Plaintiff would not agree to enter into the long term agreement with
DTSC. He wanted Plaintiff to feel
pressured into entering into such the [sic] agreement with the DTSC, and was
trying to hurt Plaintiff’s business interests to the extent that Plaintiff
would give in to the coercive tactics, and then sign the agreement being
proffered by DTSC. Mr. Movlay made the aforementioned
statement with a conscious intent to deceive the potential Buyer so that he
would not purchase the Property. Again,
this was designed to accomplish the goal of coercing Plaintiff into entering a
voluntary agreement with DTSC that was not required by law.”
In January 2021, Gogadze alleges that he received
yet another offer to purchase the property; and that deal was also lost because
the buyer was told by Molvay they would be required to enter into an Operations
and Maintenance Agreement. Plaintiff
alleges this was false, and done to harm Gogadze.
Statutory liability is alleged in ¶¶28 and 29
pursuant to Gov. Code §820 and §815.2.
III. REQUEST
FOR JUDICIAL NOTICE
Code Civ. Proc. §430.30, subdivision (a) provides, “When any
ground for objection to the complaint . . . appears from… matter of
which the court is required to or may take judicial notice, the objection on
that ground may be taken by a demurrer to the pleading.”
Defendants’ request that the Court take judicial
notice of the following documents is granted:
Exhibits 1, 2, and 6, which are records of the Los
Angeles Superior Court. Judicial notice is granted pursuant to Evid. Code §452(d).
- Exhibit 1 is the verified complaint in the prior
action for quiet title, Tamazi Gogadaze v. State of California DTSC, et al.,
21BBCV00264.
- Exhibit 2 is the quiet title judgment in that
action.
- Exhibit 6 is the original complaint in this
action.
As to each of these documents, judicial notice is
taken of the document itself, but not of the truth of any matter stated
therein. Freemont Indemnity Co. v. Freemont General Corp. (2007) 148 Cal.App.4th 97, 113-114; Sosinksy v. Grant (1992) 6 Cal.App.4th
1548, 1564-1569.
Exhibits 3-5 are orders issued by DTSC. Judicial
notice of these documents is granted pursuant to Evid. Code §452(c) -- not as
to any factual findings contained in the orders themselves but as to the legal
effect of the orders. In Rodas v. Spiegel (2001) 87 Cal.App.4th 513, 518,
judicial notice of the decision and order of the Contractors’ State Licensing
Board was appropriate: “We may take judicial notice of ‘[o]fficial acts of the
legislative, executive, and judicial departments of the United States and of
any state of the United States.’ (Evid.Code, § 452, subd. (c).) Official acts
include records, reports and orders of administrative agencies.” In Hogen v.
Valley Hospital (1983) 147 Cal.App.3d 119, judicial notice was taken of the
files of the Board of Medical Quality Assurance. Here, as to Exhibits 3-5, it
is not appropriate to take judicial notice of findings of fact within those
orders. Sosiknsky, supra, 6 Cal.App.4th at 1568: “Taking judicial
notice of the truth of a judge’s factual finding would appear to us to be
tantamount to taking judicial notice that the judge’s factual finding must
necessarily have been correct and that the judge is therefore infallible. We
resist the temptation to do so.”
However, as to Exhibits 3-5, judicial notice is
taken of the orders themselves as legally operative documents. Scott
v. JP Morgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 754: “Where, as
here, judicial notice is requested of a legally operative document -- like
a contract -- the court may take notice not only of the fact of the document
and its recording or publication, but also facts that clearly derive from its legal
effect. (Fontenot, supra, 198 Cal.App.4th at p. 265, 129
Cal.Rptr.3d 467.) Moreover, whether the fact derives from the legal effect of a
document or from a statement within the document, the fact may be judicially
noticed where, as here, the fact is not reasonably subject to dispute.”
(Emphasis in original.)
- Exhibit 3 is an “Imminent and Substantial
Endangerment Order,” dated April 2007.
- Exhibit 4 is a letter dated September 2011 to the
property’s former owner. It informs the owner that DTSC had completed a “Site
Characterization” report for the site, and concluded that no further action for
remediation of the soil is needed if use of the property is limited to
commercial or industrial (not residential or school) use. It also states that
the “implementation of a Land Use Covenant” limiting the property to such use
signed by the owner is required. It also states that an “Operation and Maintenance
Agreement” is required for the proper maintenance and periodic monitoring of
groundwater underneath the site, which is “impacted with tetracholoethene and
tricholoethene.” Also attached are emails concerning this report, in which the former
owner expresses his understanding that a deed restriction is required.
- Exhibit 5 is an “Environmental Compliance Order”
dated December 7, 2020, issued to Gogadze.
IV. THE
DEMURRER IS SUSTAINED
A. Legal Standard
Code
Civ. Proc. §430.10(e) provides for a demurrer on the basis that a complaint
fails to state a cause of action. A demurrer admits, provisionally for purposes
of testing the pleading, all material facts properly pleaded. Tindell v. Murphy (2018) 22 Cal.App.5th
1239, 1247. A demurrer tests the legal sufficiency of a complaint. Donabedian v. Mercury Ins. Co. (2004)
116 Cal.App.4th 968, 994.
B. Slander of Title Cannot Be Alleged on These Facts
Slander of title,
as its name implies, concerns title to property:
“Slander of title is a false and unprivileged
disparagement, oral or written, of the title to real or personal property,
resulting in actual pecuniary damage. . . . The statement is disparaging if it
throws any doubt on the ownership of the property.” 5 Witkin, Summary of Cal. Law
(11th ed.) Torts, §747, bolding added.
“The elements of a cause of action for slander of title are
‘(1) a publication, (2) which is without privilege or justification, (3)
which is false, and (4) which causes direct and immediate pecuniary loss.’ (Manhattan
Loft, LLC v. Mercury Liquors, Inc. (2009) 173 Cal.App.4th 1040, 1051, 93
Cal.Rptr.3d 457, italics added; see also Howard v. Schaniel (1980) 113
Cal.App.3d 256, 263–264, 169 Cal.Rptr. 678.)” Alpha & Omega Development,
LP v. Whillock Contracting, Inc. (2011) 200 Cal.App.4th 656, 664.
According to CACI 1730, the first element of the tort is: “That
[name of defendant] [made a statement/[specify other act, e.g., recorded a
deed] that cast doubts about [name of plaintiff]’s ownership of the property.” The
first case cited in the Directions for Use for CACI 1730 is as follows: “Slander
of title may be either by words or an act that clouds title to the
property,” citing Alpha & Omega Development, LP v. Whillock Contracting,
Inc. (2011) 200 Cal.App.4th 656, 661, bolding added.
In arguing that slander of title does not necessarily
involve title, Gogadze relies on four cases. His argument is unpersuasive,
however, as each of the cases in fact involves title.
M.F. Farming Co. v. Couch Distributing Co., Inc.
(2012) 207 Cal.App.4th 180 involves title to real property. The Court of Appeal
in that case stated: “The slander of
title cause of action alleged that . . . defendant Couch Distributing
published, without privilege or justification, false maps and plot plans that
cast doubt on plaintiff’s title. The cancellation of cloud on title cause of
action alleged that the improperly published documents were false and
fraudulently indicated that defendant Couch Distributing owned the property at
issue and plaintiff MF owned only an easement.” Id. at 187-188.
Gudger v. Munton (1943) 21 Cal.2d 537 concerned enforcement
of a judgment through the recording of a writ of execution on real property. In
that case, a husband’s separate real property was the subject of the writ,
while the judgment involved a premarital judgment against wife alone. The husband
prevailed in his action for quiet title and disparagement of title.
Finch v. Aerospace Corp. v. City of San Diego (2017)
8 Cal.App.5th 1248 concerned title to airport hangars.
Appel v. Burman (1984) 159 Cal.App.3d 1209 involved a
boundary dispute between neighbors. One neighbor had plans to move an existing
boundary fence to correspond to the actual boundary between the properties, and
to have a utility pole moved at the same time. The other neighbor resisted, falsely
telling the power company that the boundary fence was on the actual boundary,
thus disparaging title.
The central issue raised by the demurrer in this case is
whether the FAC alleges sufficient facts demonstrating false and unprivileged disparagement
of Gogadze’s title. At paragraph 19 of the FAC, Gogadze alleges that Movlay’s
statement to prospective buyer Aslabekyan
disparaged his title, because Movlay purportedly told the prospective buyer that
an Operations and Maintenance Agreement with DTSC was required and had to be
recorded with the Los Angeles County Recorder. It is also alleged that Molvay
told the prospective buyer that he would have to prepay hundreds of thousands
of dollars; but it is not clear how that disparages title to the property.
Based on the judicially noticed documents,
including documents evidencing DTSC’s
orders, it is apparent that the property is in fact encumbered by a recorded deed
restriction regarding use of the property (commercial or industrial only), and an
Operations and Maintenance Agreement, which is publicly available on DTSC’s “EnviroStor”
website. Consequently, DTSC argues, Molvay was only making true statements. While
it is alleged that Molvay told the prospective buyer the Operations and
Maintenance Agreement would need to be recorded, which is slightly
different than publicly available, the statement is not false.
Based on the allegations and the
matters of which the Court takes judicial notice, it does not appear that
slander of title has been (or can be) adequately alleged.
C.
The Litigation Privilege Bars Slander of Title as to the Judgment Lien
The litigation privilege applies to recorded judgment liens
which follow and are related to litigation that has already taken place. Weeden
v. Hoffman (2021) 70 Cal.App.5th 269, 288. To the extent Gogadze’s slander
of title claim is based on the recorded judgment lien, the FAC fails to state a
cause of action, as such an act is protected by the litigation privilege.
Gogadze’s opposition brief clarifies that he is not basing
his slander of title claim on the judgment lien. This was not clear from the FAC,
however, or even from Gogadze’s summary of salient allegations at pages 4 and 5
of his opposition -- most of which discuss the lien. However, the Court accepts
Gogadze’s concession that this argument is moot, since he is no longer seeking
relief based on the judgment lien. Opposition at 10:19-22.
As Gogadze’s claim is not tied to the lien, DTSC’s
causation argument is also moot.
D. The Misrepresentation Privilege Does Not Apply
DTSC urges that to the extent Gogadze’s claim is based on
statements Molvay made, Gov. Code §822.2 provides immunity. At least one case
has concluded to the contrary. “[S]lander of title is not a form of deceit. It
is a form of the separate common law tort of disparagement, also sometimes
referred to as injurious falsehood. [fn. 3] (Compare Rest.2d Torts, § 525 with
Rest.2d Torts, §§ 623A, 624; see 3 Dobbs et al., The Law of Torts, supra, §
656, p. 617; see also Hartford, supra, 59 Cal.4th 277, 289–290,
172 Cal.Rptr.3d 653, 326 P.3d 253.) Consequently, the immunities in sections
818.8 and 822.2 do not apply to slander of title. (See Costa Mesa, supra,
214 Cal.App.4th at p. 383, 154 Cal.Rptr.3d 698.)” Finch, supra, 8
Cal.App.5th at 1253.
V. MOTION
TO STRIKE
Code Civ. Proc. §436 permits courts to
strike any irrelevant, false, or improper matter inserted in a pleading. Here,
with the sustaining of the demurrer, there is no operative pleading from which
anything may be stricken. The motion to strike is therefore denied as moot.
VI. CONCLUSION
AND ORDER
The demurrer is sustained on the ground that, based on the
facts alleged and those that are judicially noticed, slander of title cannot be
successfully alleged because Molvay’s statements were true. Leave to amend is denied.
The motion to strike is denied as moot.
Defendants are ordered to give notice of this ruling, and
to lodge forthwith a proposed judgment of dismissal.
Dated: _______________________________
MARGARET L. OLDENDORF
JUDGE
OF THE SUPERIOR COURT
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES
NORTHEAST DISTRICT
I.
INTRODUCTION
Plaintiff Tamazi Gogadze purchased
certain commercial real property from the LA County Tax Assessor at auction. The
property has been subject to abatement orders from Defendant State of
California Department of Toxic Substances Control (DTSC), stemming from its
prior use as a metal plating business.
The gist of the pleading is that
Gogadze could not obtain title insurance for the property, and lost several
opportunities to sell the property because there was a lien on the property;
and because DTSC employees, including Defendant Patrick Movlay, told Plaintiff
(and at least one prospective buyer) that anyone who owns the property must
enter into a 30-year Operations and Maintenance Agreement for monitoring the
groundwater aquifer, and prepay hundreds of thousands of dollars for monitoring
costs. Plaintiff alleges that these statements were false. Gogadze’s First
Amended Complaint contains one cause of action for slander of title.
Defendants’ demurrer to the original
pleading was sustained with leave to amend on the ground that public entity
liability must be based on statute. The First Amended Complaint continues to assert
the single cause of action for slander of title. Gogadze has added allegations that Movlay is
liable for injury caused by his act or omission pursuant to Gov. Code §820; and
that DTSC is derivatively liable pursuant to Gov. Code §815.2. These facts,
along with the matters that may be judicially noticed, fail to state a cause of
action because Movlay’s statements regarding Gogadze’s title were not false.
In addition (as with the previous
version of the Complaint), to the extent slander of title is based on the
recorded judgment lien it is absolutely privileged.
For these reasons, the demurrer to the
First Amended Complaint (FAC) is sustained. It does not appear that amendment
can cure these defects, so the tentative is to deny leave to amend. In light of the ruling on the demurrer, the
motion to strike is taken off calendar.
II. SUMMARY
OF ALLEGATIONS
The is litigation concerns the real property located
at 1102 West Isabel Street in Burbank. DTSC is a public agency organized under
the laws of the State of California. Patrick Movlay is a DTSC employee. (Two
other previously named employees were dropped from the FAC.)
Gogadze purchased the Isabel Street property for
$190,000 on October 21, 2019. Two days later he learned from a title company
representative that DTSC had a lien on the property, which was imposed in
connection with the business activities of the prior owner.
In November 2019, Gogadze spoke to Movlay, and told
him that the lien must be removed immediately so that he could have clear title
and obtain title insurance. Instead of releasing the lien, DTSC thereafter
attempted to get Gogadze to enter into an Operations and Maintenance Agreement.
He refused to sign such an agreement.
In January 2020, Gogadze received an offer to
purchase the property for $1.1 million; the offer was allegedly never
consummated because Gogadze could not remove the lien. Instead of removing the
lien, DTSC allegedly attempted to pressure Gogadze into signing the Operations
and Maintenance agreement. Shortly after that, Gogadze contacted DTSC’s
attorney Robin McGinnis to request that the lien be removed.
In March 2020, Gogadze received an offer to lease
the property for $3,042 per month, which he also allegedly lost because he
could not get DTSC to remove the lien.
From April to June of 2020, Gogadze received offers
to purchase the property for $975,000 and then $700,000. He alleges he lost them for the same reason.
In November 2020, Gogadze received an offer to
purchase the property for $875,000. Again,
this offer allegedly could not be consummated for the same reason.
Paragraph 19 contains Gogadze’s central charging
allegation. It is quoted here in full:
“The potential buyer of the property, Arthur
Aslabekyan telephoned and spoke directly to DTSC employee, defendant Patrick
Movlay, an employee of defendant DTSC, while conducting his due diligence
research. Defendant Movlay told the
potential buyer that, by law, an existing owner and any future owners, must
enter into an Operation and Maintenance Agreement with DTSC and must
prepay hundreds of thousands of dollars in advance to the DTSC because the
water underneath the land in the aqueduct or aquifer that spreads throughout
the Burbank, San Fernando Valley, and Glendale areas, was very bad quality, and
in addition, that the Operations and Maintenance Agreement with DTSC was
required to be recorded with the Los Angeles County Recorder. This statement by Mr. Movlay to Mr.
Aslabekyan, however, was false, and Movlay knew it to be false when he made
it. The statement disparaged the title
to Plaintiff’s Property directly to this potential buyer. Defendant Movlay made the false and
disparaging statement to the buyer, Mr. Aslabekyan, with actual malice because
Mr. Movlay’s intent was to harm Plaintiff Gogadze and his business interests
because Mr. Gogadze was refusing to enter into an Agreement with DTSC. Defendant Movlay was
upset that Plaintiff would not agree to enter into the long term agreement with
DTSC. He wanted Plaintiff to feel
pressured into entering into such the [sic] agreement with the DTSC, and was
trying to hurt Plaintiff’s business interests to the extent that Plaintiff
would give in to the coercive tactics, and then sign the agreement being
proffered by DTSC. Mr. Movlay made the aforementioned
statement with a conscious intent to deceive the potential Buyer so that he
would not purchase the Property. Again,
this was designed to accomplish the goal of coercing Plaintiff into entering a
voluntary agreement with DTSC that was not required by law.”
In January 2021, Gogadze alleges that he received
yet another offer to purchase the property; and that deal was also lost because
the buyer was told by Molvay they would be required to enter into an Operations
and Maintenance Agreement. Plaintiff
alleges this was false, and done to harm Gogadze.
Statutory liability is alleged in ¶¶28 and 29
pursuant to Gov. Code §820 and §815.2.
III. REQUEST
FOR JUDICIAL NOTICE
Code Civ. Proc. §430.30, subdivision (a) provides, “When any
ground for objection to the complaint . . . appears from… matter of
which the court is required to or may take judicial notice, the objection on
that ground may be taken by a demurrer to the pleading.”
Defendants’ request that the Court take judicial
notice of the following documents is granted:
Exhibits 1, 2, and 6, which are records of the Los
Angeles Superior Court. Judicial notice is granted pursuant to Evid. Code §452(d).
- Exhibit 1 is the verified complaint in the prior
action for quiet title, Tamazi Gogadaze v. State of California DTSC, et al.,
21BBCV00264.
- Exhibit 2 is the quiet title judgment in that
action.
- Exhibit 6 is the original complaint in this
action.
As to each of these documents, judicial notice is
taken of the document itself, but not of the truth of any matter stated
therein. Freemont Indemnity Co. v. Freemont General Corp. (2007) 148 Cal.App.4th 97, 113-114; Sosinksy v. Grant (1992) 6 Cal.App.4th
1548, 1564-1569.
Exhibits 3-5 are orders issued by DTSC. Judicial
notice of these documents is granted pursuant to Evid. Code §452(c) -- not as
to any factual findings contained in the orders themselves but as to the legal
effect of the orders. In Rodas v. Spiegel (2001) 87 Cal.App.4th 513, 518,
judicial notice of the decision and order of the Contractors’ State Licensing
Board was appropriate: “We may take judicial notice of ‘[o]fficial acts of the
legislative, executive, and judicial departments of the United States and of
any state of the United States.’ (Evid.Code, § 452, subd. (c).) Official acts
include records, reports and orders of administrative agencies.” In Hogen v.
Valley Hospital (1983) 147 Cal.App.3d 119, judicial notice was taken of the
files of the Board of Medical Quality Assurance. Here, as to Exhibits 3-5, it
is not appropriate to take judicial notice of findings of fact within those
orders. Sosiknsky, supra, 6 Cal.App.4th at 1568: “Taking judicial
notice of the truth of a judge’s factual finding would appear to us to be
tantamount to taking judicial notice that the judge’s factual finding must
necessarily have been correct and that the judge is therefore infallible. We
resist the temptation to do so.”
However, as to Exhibits 3-5, judicial notice is
taken of the orders themselves as legally operative documents. Scott
v. JP Morgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 754: “Where, as
here, judicial notice is requested of a legally operative document -- like
a contract -- the court may take notice not only of the fact of the document
and its recording or publication, but also facts that clearly derive from its legal
effect. (Fontenot, supra, 198 Cal.App.4th at p. 265, 129
Cal.Rptr.3d 467.) Moreover, whether the fact derives from the legal effect of a
document or from a statement within the document, the fact may be judicially
noticed where, as here, the fact is not reasonably subject to dispute.”
(Emphasis in original.)
- Exhibit 3 is an “Imminent and Substantial
Endangerment Order,” dated April 2007.
- Exhibit 4 is a letter dated September 2011 to the
property’s former owner. It informs the owner that DTSC had completed a “Site
Characterization” report for the site, and concluded that no further action for
remediation of the soil is needed if use of the property is limited to
commercial or industrial (not residential or school) use. It also states that
the “implementation of a Land Use Covenant” limiting the property to such use
signed by the owner is required. It also states that an “Operation and Maintenance
Agreement” is required for the proper maintenance and periodic monitoring of
groundwater underneath the site, which is “impacted with tetracholoethene and
tricholoethene.” Also attached are emails concerning this report, in which the former
owner expresses his understanding that a deed restriction is required.
- Exhibit 5 is an “Environmental Compliance Order”
dated December 7, 2020, issued to Gogadze.
IV. THE
DEMURRER IS SUSTAINED
A. Legal Standard
Code
Civ. Proc. §430.10(e) provides for a demurrer on the basis that a complaint
fails to state a cause of action. A demurrer admits, provisionally for purposes
of testing the pleading, all material facts properly pleaded. Tindell v. Murphy (2018) 22 Cal.App.5th
1239, 1247. A demurrer tests the legal sufficiency of a complaint. Donabedian v. Mercury Ins. Co. (2004)
116 Cal.App.4th 968, 994.
B. Slander of Title Cannot Be Alleged on These Facts
Slander of title,
as its name implies, concerns title to property:
“Slander of title is a false and unprivileged
disparagement, oral or written, of the title to real or personal property,
resulting in actual pecuniary damage. . . . The statement is disparaging if it
throws any doubt on the ownership of the property.” 5 Witkin, Summary of Cal. Law
(11th ed.) Torts, §747, bolding added.
“The elements of a cause of action for slander of title are
‘(1) a publication, (2) which is without privilege or justification, (3)
which is false, and (4) which causes direct and immediate pecuniary loss.’ (Manhattan
Loft, LLC v. Mercury Liquors, Inc. (2009) 173 Cal.App.4th 1040, 1051, 93
Cal.Rptr.3d 457, italics added; see also Howard v. Schaniel (1980) 113
Cal.App.3d 256, 263–264, 169 Cal.Rptr. 678.)” Alpha & Omega Development,
LP v. Whillock Contracting, Inc. (2011) 200 Cal.App.4th 656, 664.
According to CACI 1730, the first element of the tort is: “That
[name of defendant] [made a statement/[specify other act, e.g., recorded a
deed] that cast doubts about [name of plaintiff]’s ownership of the property.” The
first case cited in the Directions for Use for CACI 1730 is as follows: “Slander
of title may be either by words or an act that clouds title to the
property,” citing Alpha & Omega Development, LP v. Whillock Contracting,
Inc. (2011) 200 Cal.App.4th 656, 661, bolding added.
In arguing that slander of title does not necessarily
involve title, Gogadze relies on four cases. His argument is unpersuasive,
however, as each of the cases in fact involves title.
M.F. Farming Co. v. Couch Distributing Co., Inc.
(2012) 207 Cal.App.4th 180 involves title to real property. The Court of Appeal
in that case stated: “The slander of
title cause of action alleged that . . . defendant Couch Distributing
published, without privilege or justification, false maps and plot plans that
cast doubt on plaintiff’s title. The cancellation of cloud on title cause of
action alleged that the improperly published documents were false and
fraudulently indicated that defendant Couch Distributing owned the property at
issue and plaintiff MF owned only an easement.” Id. at 187-188.
Gudger v. Munton (1943) 21 Cal.2d 537 concerned enforcement
of a judgment through the recording of a writ of execution on real property. In
that case, a husband’s separate real property was the subject of the writ,
while the judgment involved a premarital judgment against wife alone. The husband
prevailed in his action for quiet title and disparagement of title.
Finch v. Aerospace Corp. v. City of San Diego (2017)
8 Cal.App.5th 1248 concerned title to airport hangars.
Appel v. Burman (1984) 159 Cal.App.3d 1209 involved a
boundary dispute between neighbors. One neighbor had plans to move an existing
boundary fence to correspond to the actual boundary between the properties, and
to have a utility pole moved at the same time. The other neighbor resisted, falsely
telling the power company that the boundary fence was on the actual boundary,
thus disparaging title.
The central issue raised by the demurrer in this case is
whether the FAC alleges sufficient facts demonstrating false and unprivileged disparagement
of Gogadze’s title. At paragraph 19 of the FAC, Gogadze alleges that Movlay’s
statement to prospective buyer Aslabekyan
disparaged his title, because Movlay purportedly told the prospective buyer that
an Operations and Maintenance Agreement with DTSC was required and had to be
recorded with the Los Angeles County Recorder. It is also alleged that Molvay
told the prospective buyer that he would have to prepay hundreds of thousands
of dollars; but it is not clear how that disparages title to the property.
Based on the judicially noticed documents,
including documents evidencing DTSC’s
orders, it is apparent that the property is in fact encumbered by a recorded deed
restriction regarding use of the property (commercial or industrial only), and an
Operations and Maintenance Agreement, which is publicly available on DTSC’s “EnviroStor”
website. Consequently, DTSC argues, Molvay was only making true statements. While
it is alleged that Molvay told the prospective buyer the Operations and
Maintenance Agreement would need to be recorded, which is slightly
different than publicly available, the statement is not false.
Based on the allegations and the
matters of which the Court takes judicial notice, it does not appear that
slander of title has been (or can be) adequately alleged.
C.
The Litigation Privilege Bars Slander of Title as to the Judgment Lien
The litigation privilege applies to recorded judgment liens
which follow and are related to litigation that has already taken place. Weeden
v. Hoffman (2021) 70 Cal.App.5th 269, 288. To the extent Gogadze’s slander
of title claim is based on the recorded judgment lien, the FAC fails to state a
cause of action, as such an act is protected by the litigation privilege.
Gogadze’s opposition brief clarifies that he is not basing
his slander of title claim on the judgment lien. This was not clear from the FAC,
however, or even from Gogadze’s summary of salient allegations at pages 4 and 5
of his opposition -- most of which discuss the lien. However, the Court accepts
Gogadze’s concession that this argument is moot, since he is no longer seeking
relief based on the judgment lien. Opposition at 10:19-22.
As Gogadze’s claim is not tied to the lien, DTSC’s
causation argument is also moot.
D. The Misrepresentation Privilege Does Not Apply
DTSC urges that to the extent Gogadze’s claim is based on
statements Molvay made, Gov. Code §822.2 provides immunity. At least one case
has concluded to the contrary. “[S]lander of title is not a form of deceit. It
is a form of the separate common law tort of disparagement, also sometimes
referred to as injurious falsehood. [fn. 3] (Compare Rest.2d Torts, § 525 with
Rest.2d Torts, §§ 623A, 624; see 3 Dobbs et al., The Law of Torts, supra, §
656, p. 617; see also Hartford, supra, 59 Cal.4th 277, 289–290,
172 Cal.Rptr.3d 653, 326 P.3d 253.) Consequently, the immunities in sections
818.8 and 822.2 do not apply to slander of title. (See Costa Mesa, supra,
214 Cal.App.4th at p. 383, 154 Cal.Rptr.3d 698.)” Finch, supra, 8
Cal.App.5th at 1253.
V. MOTION
TO STRIKE
Code Civ. Proc. §436 permits courts to
strike any irrelevant, false, or improper matter inserted in a pleading. Here,
with the sustaining of the demurrer, there is no operative pleading from which
anything may be stricken. The motion to strike is therefore denied as moot.
VI. CONCLUSION
AND ORDER
The demurrer is sustained on the ground that, based on the
facts alleged and those that are judicially noticed, slander of title cannot be
successfully alleged because Molvay’s statements were true. Leave to amend is denied.
The motion to strike is denied as moot.
Defendants are ordered to give notice of this ruling, and
to lodge forthwith a proposed judgment of dismissal.
Dated: _______________________________
MARGARET L. OLDENDORF
JUDGE
OF THE SUPERIOR COURT