Judge: Maurice A. Leiter, Case: 22STCV17343, Date: 2023-02-15 Tentative Ruling

Case Number: 22STCV17343    Hearing Date: February 15, 2023    Dept: 54

Hearing Date: February 15, 2023

Department 54, Judge Maurice A. Leiter

(2) Demurrers to Complaint

Moving Party: (1) Defendants Masoud Koshki, Shlomo Koshki and P & J La Brea LLC; (2) Ellie Page, Trustee of the Jill Ilana Wizel Special Needs Trust

Responding Party: Plaintiff Arthur Edward Ezor

T/R:    DEFENDANTS MASOUD KOSHKI, SHLOMO KOSHKI AND P & J LA BREA LLC’S DEMURRER TO THE FOURTH CAUSE OF ACTION IS SUSTAINED. THE DEMURRER TO THE REMAINING CAUSES OF ACTION IS OVERRULED.

DEFENDANT ELLIE PAGE’S DEMURRER TO THE FIRST THROUGH FOURTH CAUSES OF ACTION IS SUSTAINED. THE DEMURRER TO THE REMAINING CAUSES OF ACTION IS OVERRULED.

PLAINTIFF TO FILE AND SERVE A FIRST AMENDED COMPLAINT WITHIN 30 DAYS OF NOTICE OF RULING. DEFENDANTS TO FILE AND SERVE RESPONSES WITHIN 30 DAYS THEREAFTER.

            DEFENDANTS to notice. 

If the parties wish to submit on the tentative, please email the courtroom at¿SMCdept54@lacourt.org¿with notice to opposing counsel (or self-represented party) before 8:30 am on the day of the hearing. 

            The Court considers the moving papers, oppositions, and replies.

BACKGROUND

            On May 26, 2022, Plaintiff Arthur Edward Ezor sued Defendants Ellie Page, Doe 1, all persons unknown claiming any legal or equitable right, title, estate, lien, or interest in the Property, Masoud Koshki, Shlomo Harari, Norma Diller, Jose Jaime, Dagoberto Jaime, P&J Labrea, LLC, and Does 2-100, inclusive. The complaint asserts causes of action for (1) Negligence; (2) Declaratory Relief to Set Aside Sheriff’s Sale; (3) Recission Voiding or Cancelling Sheriff’s Sale; (4) Wrongful Foreclosure; (5) Unjust Enrichment; (6) Violation of California Business and Professions Code § 17200; (7) Quiet Title; (8) Conspiracy to Commit Fraudulent Conveyance; (9) Intentional Interference with Economic Relations; and (10) Breach of Oral Contract.

Plaintiff alleges that Page, his judgment creditor on a past judgment, conspired to sell his real property at sheriff’s sale to Masoud Koshki, Shlomo Koshki, and P & J La Brea LLC for less than fair market value. Plaintiff also alleges Defendants wrongfully sought a sheriff’s sale while escrow with another buyer was pending.

REQUESTS FOR JUDICIAL NOTICE

            Defendant Page’s request for judicial notice is GRANTED.

ANALYSIS

A demurrer to a complaint may be taken to the whole complaint or to any of the causes of action in it.  (CCP § 430.50(a).)  A demurrer challenges only the legal sufficiency of the complaint, not the truth of its factual allegations or the plaintiff's ability to prove those allegations.  (Picton v. Anderson Union High Sch. Dist. (1996) 50 Cal. App. 4th 726, 732.)  The court must treat as true the complaint's material factual allegations, but not contentions, deductions or conclusions of fact or law.  (Id. at 732-33.)  The complaint is to be construed liberally to determine whether a cause of action has been stated.  (Id. at 733.)

A. Defendants Masoud Koshki, Shlomo Koshki, and P & J La Brea LLC’s Demurrer to Complaint

1. Negligence

            Defendants, the buyers of the property, demur to the first cause of action on the ground that they did not owe Plaintiff a duty of care. This cause of action is not asserted against moving Defendants, it is only asserted against Page.

            The demurrer to the first cause of action is OVERRULED.

2. Declaratory Relief, Cancellation of Instruments

            Defendants demur to the second and third causes of action on the ground that the the judgment is not in contention and Plaintiff has not alleged the violation of a due process right. These are not grounds for demurrer.

            The demurrer to the second and third causes of action is OVERRULED.

3. Wrongful Foreclosure

            Defendants assert that the claim for wrongful foreclosure fails because a sheriff’s sale is not a foreclosure. Plaintiff does not address this in opposition.

            The demurrer to the fourth cause of action is SUSTAINED.

4. Unjust Enrichment UCL Violations, Quiet Title, Fraud, Tortious Interference, IIED

            Defendants argue that Plaintiff cannot allege causes of action for unjust enrichment, UCL violations, quiet title, fraud, tortious interference, and IIED because Defendants tendered the necessary funds to the sheriff for the property and abided by the proper legal procedure to purchase the property. This is not alleged in the complaint.

            The demurrer to the fifth through ninth causes of action is OVERRULED.  

B. Defendant Ellie Page’s, Trustee of the Jill Ilana Wizel Special Needs Trust, Demurrer to Complaint

1. Statute of Limitations

A demurrer lies where the dates alleged in the complaint show “clearly and affirmatively” that the action is barred by a statute of limitations.  It is not enough that the complaint shows that the action may be barred.  (Geneva Towers Ltd. Partnership v. City of San Francisco (2003) 29 Cal.4th 769, 781.)  

Page argues that Plaintiff’s causes of action are barred by the applicable statutes of limitations because the sale of the property occurred more than four years before this action was filed. In opposition and in the complaint Plaintiff asserts that the statutes of limitation were equitably tolled while Plaintiff sought relief in federal court. The complaint is not clearly and affirmatively barred on its face. The demurrer cannot be sustained on this basis.

2. Negligence

The elements for negligence are: (1) a legal duty owed to the plaintiff to use due care; (2) breach of duty; (3) causation; and (4) damage to the plaintiff. (County of Santa Clara v. Atlantic Richfield Co. (2006) 137 Cal.App.4th 292, 318.)  

            Page asserts that Plaintiff’s cause of action for negligence fails because she did not owe Plaintiff a duty. Plaintiff alleges “PAGE had a duty to exercise reasonable care and skill to ensure that the escrow on the subject property was properly adhered to and respected.” Plaintiff alleges Page breached a duty of care to Plaintiff by executing a “rigged” sheriff’s sale.

            These allegations are insufficient to support a negligence cause of action. Plaintiff does not cite authority showing a judgment creditor owes a duty of care not to interfere with an escrow.

            The demurrer to the first cause of action for negligence is SUSTAINED.

3. Declaratory Relief, Cancellation of Instruments

            Page demurs to the causes of action for declaratory relief and cancellation of instruments on the ground that sheriff’s sales cannot be set aside for any reason per CCP § 701.680. Plaintiff does not address this argument in opposition.

            The demurrer to the second and third causes of action is SUSTAINED.

4. Wrongful Foreclosure

            Page demurs to the fourth cause of action on the ground that Civ. Code § 2923.5 applies to traditional lender/borrower foreclosures, not sheriff’s sales. Plaintiff does not address this argument in opposition.

            The demurrer to the fourth cause of action is SUSTAINED.

5. Unjust Enrichment

            Page asserts that the fifth cause of action fails on the ground that the courts authorized the sheriff’s sale and because Page received only half of the judgment amount from the sale. These are not grounds for demurrer. That Page received half the judgment amount is not alleged in the complaint and Page does not cite authority stating court authorization defeats unjust enrichment.

            The demurrer to the fifth cause of action is OVERRULED.

6. UCL Violations

            Page demurs to the cause of action for UCL violations on the grounds that the court authorized the sale, and that the sale was a single incident rather than pattern of behavior. Page does not cite authority stating court approval defeats a cause of action for UCL violations.

            The demurrer to the sixth cause of action is OVERRULED.

7. Quiet Title and Fraud

The elements of fraud are: “(a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.” (Charnay v. Cobert (2006) 145 Cal.App.4th 170, 184.) In California, fraud, including negligent misrepresentation, must be pled with specificity. (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.) “The particularity demands that a plaintiff plead facts which show how, when, where, to whom, and by what means the representations were tendered.” (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1469.)  

Page argues that the causes of action for fraud and quiet title fail because Page could have made more money by purchasing the property herself and because Plaintiff does not have evidence showing the buyers did not actually pay for the property. These are not grounds for demurrer.

The demurrer to the seventh and eighth causes of action is OVERRULED.

8. Intentional Interference with Economic Relations

The elements for the tort of intentional interference with prospective economic advantage are: “(1) an economic relationship between the plaintiff and some third party, with the probability of future economic benefit to the plaintiff; (2) the defendant’s knowledge of the relationship; (3) intentional acts on the part of the defendant designed to disrupt the relationship; (4) actual disruption of the relationship; and (5) economic harm to the plaintiff proximately caused by the acts of the defendant.” (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1153.)  

Page demurs to the ninth cause of action on the ground that the property was sold at fair market value and Page acted in good faith. These facts are not alleged in the complaint. The demurrer cannot be sustained on this basis.

The demurrer to the ninth cause of action is OVERRULED.