Judge: Maurice A. Leiter, Case: 23STCV30964, Date: 2024-03-21 Tentative Ruling

Case Number: 23STCV30964    Hearing Date: March 21, 2024    Dept: 54

Hearing Date: March 21, 2024

Department 54, Judge Maurice Leiter

Demurrer with Motion to Strike

Moving Party:            Defendants Senator 2015, LP and SRHT Property Management  

Responding Party:   Plaintiffs Michael Binns, Yomi Vincent, Darren Boyce, James Perkins, Crystalee Horlacher, Carroll Mercadel, Andra Stevens, Shirlemadeline Bailey, Earl Hammons, Henry Duncan, Rahman Smith, Paul Harway, Ralph Locurcio, Fred Schoenahl, Jose Leon, David Valdevia, Ashley Brooks, Audry Monroy, Fushchia Hayes, David Watson, Enrique Velez, Cordell Marshall, Richard Walker, Paula Bilson, Lorissa Pugh, Anthony Jeffries, Victor Pantoja and Gerald Pierce

T/R:     Defendants’ Demurrer is OVERRULED.  Defendants’ Motion to Strike is DENIED. 

DEFENDANTS TO PROVIDE 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, late-filed opposition,[1] and reply.

BACKGROUND

Plaintiffs are the tenants in a building owned and managed by Defendants.  Plaintiffs allege their units suffered from multiple defects that rendered them dangerous and uninhabitable, including inadequate weather protection, inadequate plumbing, dampness and mold, inadequate sanitation, lack of heating and ventilation, vermin infestation, structural hazards, inadequate wiring, and inadequate mechanical equipment. 

On December 19, 2023, Plaintiffs sued Defendants Senator 2015 LP and SRHT Property Management Company, alleging (1) breach of the covenant of quiet enjoyment/warranty of habitability; (2) tortious breach of the implied warranty of habitability; (3) negligence; (4) violation of Civil Code §1942.4; (5) violation of unfair business practices; and (6) tenant harassment.

ANALYSIS

A.   Demurrer

The grounds for a demurrer must appear on the face of the pleading or from judicially noticeable matters.  (Code Civ. Proc. § 430.30(a); Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)  Concerning the legal sufficiency of a pleading, the sole issue on demurrer is whether the facts pleaded, if true, state a valid cause of action – i.e., if the complaint pleads facts that would entitle the plaintiff to relief.  (LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 339.)

            A general demurrer admits the truth of all factual, material allegations properly pled in the challenged pleading, regardless of possible difficulties of proof.  (Blank, supra, 39 Cal.3d at p. 318.)  Thus, no matter how unlikely or improbable, plaintiff’s allegations must be accepted as true for the purpose of ruling on the demurrer.  (Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604.)  Nevertheless, this rule does not apply to allegations expressing mere conclusions of law, or allegations contradicted by the exhibits to the complaint or by matters of which judicial notice may be taken.  (Vance v. Villa Park Mobilehome Estates (1995) 36 Cal.App.4th 698, 709.)  A general demurrer does not admit contentions, deductions, or conclusions of fact or law alleged in the complaint; facts impossible in law; or allegations contrary to facts of which a court may take judicial notice.  (Blank, supra, 39 Cal.3d at p. 318.)

            Defendants demur to the first cause of action for breach of contract and the fifth cause of action for unfair business practices.  Defendants argue the first cause of action for breach of contract fails because Plaintiff fails to allege the terms of the lease agreement, the specific term of the lease agreement breached and when it was breached.  Defendants argue that without such information, they cannot tell if the action is barred by the statute of limitations. 

            Defendants argue the first cause of action also is uncertain, because it attempts to allege three separate causes of action in one.  Defendants argue they cannot determine the nature of the allegations against them. 

            The elements for a breach of contract cause of action are: (1) the existence of a contract; (2) plaintiff’s performance or excuse for nonperformance; (3) defendant’s breach; and (4) resulting damages.  (Reichert v. General Ins. Co. (1968) 68 Cal.2d 822, 830.)  A written contract may be pleaded either word for word or generally “according to its legal intendment and effect” (e.g., “Defendant agreed to sell the described property to Plaintiff for $100,000”).  (Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 198–199.) 

            “In addition to asserting a breach of the habitability warranty as a defense to an unlawful detainer action, a tenant may bring suit against the landlord for damages resulting from such breach.  The elements of such an affirmative claim are the existence of a material defective condition affecting the premises' habitability, notice to the landlord of the condition within a reasonable time after the tenant's discovery of the condition, the landlord was given a reasonable time to correct the deficiency, and resulting damages.”  (Erlach v. Sierra Asset Servicing, LLC (2014) 226 Cal.App.4th 1281, 1296-1297 (warranty of habitability implied by common law into every residential lease in California.)

            Plaintiffs’ allegations sufficiently allege the elements of breach of contract, breach of the implied covenant of quiet enjoyment, and breach of the warranty of habitability.  Each of these claims is essentially a breach of contract claim. Plaintiffs allege the dates on which they entered into written lease agreements with Defendants (Complaint, ¶¶10-37).  Plaintiffs allege in detail the nature of the alleged breaches of the covenant of quiet enjoyment and warranty of habitability.  (Complaint, ¶¶42-54.)  Plaintiffs also allege that they each suffered personal injury, property damage, mental and emotional distress, excessive rent payments and other damages at the premises.  (Complaint, ¶58.)  No further allegations of damage are necessary.

            Plaintiffs are not required to allege the date of breach. “Where a complaint does not reveal on its face that it is barred by the statute of limitations, a plaintiff has no obligation to plead around the defense.”  (JPMorgan Chase Bank, N.A. v. Ward (2019) 33 Cal.App.5^th 678, 688.) 

            Defendants also argue that Plaintiffs’ combining three causes of action into one renders the complaint uncertain.  Defendants did not include CCP §430.10(f) in their notice of demurrer; in any event, combining all three claims in the caption of the first cause of action does not make the claim uncertain.  As discussed above, these are all in essence breach of contract claims.  Defendants will be able to reasonably respond to the allegations.  (Khoury v. O’Maly (1993) 14 Cal.App.4th 612, 616 (demurrer based on uncertainty will only be sustained where complaint is so poorly drafted that defendant cannot reasonably respond).) 

            Defendants argue the fifth cause of action for violation of Business and Professions Code §17200 fails because Plaintiffs’ allegations are devoid of any facts and merely reference statutes allegedly violated by Defendants.  Defendants argue Plaintiffs fail to allege any basis for standing or causation under section 17200 on behalf of the twenty-eight individual plaintiffs.  Defendants argue only nine plaintiffs allegedly suffered actual injury, and there are no allegations of injury as to the remaining nineteen.

“‘Unlawful business activity' proscribed under section 17200 includes anything that can properly be called a business practice and that at the same time is forbidden by law.” (Farmers Ins. Exchange v. Supr. Ct. (1992) 2 Cal.4th 377, 383.)  An action under B&PC 17200 based on an unlawful business practice “borrows violations of other laws and treats these violations, when committed pursuant to business activity, as unlawful practices independently actionable under section 17200 et seq. and subject to the distinct remedies provided thereunder.”  (Id.)

            Plaintiffs allege code and statutory violations allegedly committed in managing the subject property.  (Complaint, ¶¶70-75.)  Plaintiffs allege Defendants are “slum lords,” who lease out premises that suffer from serious habitability issues and legal violations.  (Id. at ¶¶73-75) Plaintiffs allege Defendants collected rent despite failing to remediate the habitability issues.  Plaintiffs seek restitution based on overpayment of rent for lease of uninhabitable premises.  (Complaint, ¶76.)  Plaintiff sufficiently alleges a claim for Bus. & Prof. C. §17200 based on Defendants’ unfair and illegal business practices. 

B.   Motion to Strike Punitive Damages

            “In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.”  (CC §3294(a).)

            Defendants move to strike the claim for punitive damages asserted in connection with the second cause of action for tortious breach of the implied warranty of habitability and fourth cause of action for violation of Civil Code §1942.4.  Defendants argue that no facts are alleged that would support a finding of malice, oppression, or fraud.  Defendants argue the facts alleged merely support a finding that they knew of violations and delayed in fixing them.

Plaintiffs have pleaded grounds for punitive damages based on the “conscious disregard” prong of “malice” under CC §3294(c)(1), “despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.” 

            Plaintiffs allege egregious habitability violations that repeatedly were brought to Defendants’ attention by Plaintiffs and government agencies.  (Complaint, ¶¶42, 44-45.)  The substandard maintenance of the subject property allegedly was a widespread business practice of Defendants, involving multiple properties.  (Complaint, ¶40.)  Defendants allegedly willfully refused to attend to the issues plaguing the property, exposing Plaintiffs to dangerous, uninhabitable conditions.  These allegations are sufficient to plead malice under Civil Code §3294 and Civil Code §1942.5(h)(2), which incorporates the requirement of malice, fraud or oppression in Civil Code §3294.