Judge: Martha K. Gooding, Case: 22-01271705, Date: 2023-08-07 Tentative Ruling
1) Demurrer to Amended Complaint
2) Motion to Strike Portions of Complaint
3) Case Management Conference
Defendant General Motors LLC (“Defendant”) demurs generally to the fourth cause of action for fraud/fraudulent inducement/concealment alleged in the First Amended Complaint (“FAC”) filed by Plaintiff Lisa M. Olson (“Plaintiff”). Plaintiff also seeks an order striking Plaintiff’s prayer for punitive damages from the FAC.
DEMURRER
Contrary to Plaintiff’s contention, the demurrer is not untimely. Plaintiff filed and electronically served the FAC on 1/9/2023. Defendant timely served and filed Defendant’s 2/8/2023 declaration on 2/8/2023. (Code Civ. Proc., § 430.41, subd. (a)(2).) Although Defendant’s 2/8/2023 declaration referenced the complaint in the caption and part of the declaration, the declaration also references the FAC. (Valencia 2/8/2023 Decl., ROA No. 46, 1:16 and ¶ 2.) The erroneous references to the complaint are not fatal to this demurrer.
There is no dispute that the fourth cause of action for fraud/fraudulent inducement/concealment is governed by the 3-year statute of limitations in CCP section 338, subdivision (d).
“In order for the bar of the statute of limitations to be raised by demurrer, the defect must clearly and affirmatively appear on the face of the complaint; it is not enough that the complaint shows that the action may be barred.” (Marshall v. Gibson, Dunn & Crutcher (1995) 37 Cal.App.4th 1397, 1403.)
Plaintiff alleges Plaintiff purchased the Subject Vehicle on 5/29/2019, at which time Defendant concealed material facts regarding the existing defects in the Subject Vehicle. (FAC, ¶¶ 4, 11, 25, and 35.) Plaintiff filed the initial complaint on 7/25/2022, more than 3 years after Plaintiff purchased the Subject Vehicle.
Plaintiff’s opposition argues only that Plaintiff alleged sufficient facts to show the delayed discovery rule tolled the statute of limitations.
“[U]nder the delayed discovery rule, a cause of action accrues and the statute of limitations begins to run when the plaintiff has reason to suspect an injury and some wrongful cause, unless the plaintiff pleads and proves that a reasonable investigation at that time would not have revealed a factual basis for that particular cause of action. In that case, the statute of limitations for that cause of action will be tolled until such time as a reasonable investigation would have revealed its factual basis.” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 803 (Fox).)
For delayed discovery, plaintiff “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.’ [Citation.] In assessing the sufficiency of the allegations of delayed discovery, the court places the burden on the plaintiff to ‘show diligence’; ‘conclusory allegations will not withstand demurrer.’ ” (Id., at 808.)
Plaintiff’s FAC does not allege sufficient facts to meet Plaintiff’s burden to allege tolling. (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1472.) The FAC does not allege when or the manner Plaintiff discovered the defects. Plaintiff also did not allege sufficient facts to show an inability to have made earlier discovery despite reasonable diligence. (Fox v. Ethicon Endo-Surgery, 35 Cal.4th at 808-809.)
Accordingly, the demurrer is sustained on this ground with 15 days leave to amend.
The Court notes Plaintiff’s fourth cause of action states that it is for “Fraud – fraudulent inducement – concealment.” (FAC, 21:20.) Fraudulent inducement and concealment are two separate species of fraud. Plaintiff’s opposition only addresses concealment. (Opposition, 10:14-22.) Accordingly, the Court considers this an implicit acknowledgement by Plaintiff that she intends to assert only a claim for fraudulent concealment.
The elements for a cause of action for deceit by concealment are: (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage. (Boschma v. Home Loan Center, Inc. (2011) 198 Cal.App.4th 230, 248.)
“A duty to speak may arise in four ways: it may be directly imposed by statute or other prescriptive law; it may be voluntarily assumed by contractual undertaking; it may arise as an incident of a relationship between the defendant and the plaintiff; and it may arise as a result of other conduct by the defendant that makes it wrongful for him to remain silent.” (Blickman Turkus, LP v. MF Downtown Sunnyvale, LLC (2008) 162 Cal.App.4th 858, 867.)
The Court can infer Defendant chose not to disclose the defects so that Defendant could sell the car to consumers like Plaintiff. (See, Lovejoy v. AT&T Corp. (2001) 92 Cal.App.4th 85, 96.)
Every element of fraud must be pleaded with specificity. Nonetheless, “[l]ess specificity is required when it appears from the nature of the allegations that the defendant must necessarily possess full information concerning the facts of the controversy.” (Committee on Children’s Television, 35 Cal. 3d at 216 [citation and internal quote marks omitted].)
The Court finds Plaintiff has sufficiently alleged this cause of action. The demurrer on this ground is overruled.
MOTION TO STRIKE
Defendant seeks an order striking Plaintiff’s prayer for punitive damages from the FAC. Plaintiff is not seeking punitive damages on the first three causes of action and is only seeking punitive damages on the fourth cause of action. (Opposition, ROA No. 73, 2:27-3:2.)
In light of the Court’s ruling above, the motion to strike is moot.
Defendant is ordered to give notice.