Judge: Maurice A. Leiter, Case: 23STCV17242, Date: 2024-01-31 Tentative Ruling

Case Number: 23STCV17242    Hearing Date: January 31, 2024    Dept: 54

Hearing Date: January 31, 2024

Department 54, Judge Maurice Leiter

Demurrer to First Amended Complaint and Motion to Strike

Moving Party: Defendants Buxbaum & Chakmak and Buxbaum Chakmak & Wynder PC

Responding Party: Plaintiff Peter Raspudic

T/R:     DEFENDANTS’ DEMURRER IS OVERRULED.

THE MOTION TO STRIKE IS DENIED.

DEFENDANTS TO FILE AND SERVE ANSWERS TO THE FIRST AMENDED COMPLAINT WITHIN 30 DAYS OF NOTICE OF RULING.

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 8:00 am on the day of the hearing.

The Court considers the moving papers, opposition, and reply.

BACKGROUND

On October 23, 2023, Plaintiff Peter Raspudic filed the operative first amended complaint against Defendants Charles Lyon Zetterberg, Buxbaum & Chakmak and Buxbaum Chakmak & Wynder PC, asserting causes of action for (1) breach of contract; (2) negligent misrepresentation; (3) intentional misrepresentation; and (4) fraud. Plaintiff alleges Defendants failed to respond to discovery and oppose discovery motions in an underlying trust & estate action, resulting in evidentiary sanctions against Plaintiff. Plaintiff alleges he was unable to present evidence in his defense, forcing him to take a low settlement in mediation. Plaintiff also alleges Defendants failed to disclose potential conflicts.

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. 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.)  The statute of limitations begins to run when the cause of action “accrues.”  (CCP § 312.) A cause of action “accrues” when, under the substantive law, the wrongful act is done or the wrongful result occurs, and the consequent liability arises.  (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 397.)  That is, a cause of action accrues “upon the occurrence of the last element essential to the cause of action.”  (Howard Jarvis Taxpayers Ass’n v. City of La Habra (2001) 25 Cal.4th 809, 815.) 

Defendants demur to the first cause of action for breach of contract and the second cause of action for negligent misrepresentation on the ground that they are barred by the one-year statute of limitations for attorney malpractice actions. (CCP § 340.6.) Plaintiff alleges Defendants were relieved as counsel in the underlying action on November 21, 2021. Defendants assert this began the clock for a legal malpractice action, making the last day to file suit November 21, 2022. Plaintiff filed this action on July 24, 2023.

In opposition, Plaintiff argues that the claims are not barred because the underlying action was not settled until November 30, 2022. Plaintiff asserts that he did not suffer damages until the settlement and the action did not accrue until that date. In reply, Defendants argue the claim accrued no later than June 23, 2022 when Plaintiff’s new counsel in the underlying action moved to set aside the earlier discovery/sanction motions.

As stated, a cause of action accrues “upon the occurrence of the last element essential to the cause of action.” (Howard Jarvis Taxpayers Ass’n v. City of La Habra (2001) 25 Cal.4th 809, 815.) Plaintiff alleges that damages accrued on November 30, 2022. This is sufficient to establish for purposes of demurrer that the FAC is not clearly and affirmatively barred by the statute of limitations.

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

B. 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.) 

Defendants demur to the fraud causes of action on the ground that Plaintiff has failed to allege any intentional misrepresentation. Plaintiff alleges in detail that Defendants concealed deadlines, discovery obligations, sanctions, and conflicts of interest. This is sufficient to allege intentional misrepresentation and/or concealment.

Defendants also assert that Defendant Buxbaum Chakmak & Wynder, who Plaintiff alleges is the successor-in-interest to Defendant Buxbaum & Chakmak, cannot be held liable for fraud because they are distinct entities. Plaintiff alleges the two firms merged and alleges they are only distinct entities to escape liability for malpractice. This is sufficient on demurrer to permit claims against Buxbaum Chakmak & Wynder.

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

C. Motion to Strike

Defendants move to strike the claim for punitive damages on the ground that Plaintiff has failed to allege fraud, malice, or oppression. As discussed, Plaintiff has sufficiently alleged fraud.

The motion to strike is DENIED.