Judge: Monica Bachner, Case: 22STCV16127, Date: 2023-03-15 Tentative Ruling

Case Number: 22STCV16127    Hearing Date: March 15, 2023    Dept: 71

Superior Court of California

County of Los Angeles

DEPARTMENT 71

TENTATIVE RULING

Defendant Florentino Apeles’s demurrer to Plaintiff National Robertson Car Wash Care Inc.’s first amended complaint is sustained with 20 days leave to amend.

          Defendant Florentino Apeles (“Apeles”) (“Defendant”) demurs to Plaintiff National Robertson Carwash Care Inc.’s (“NRCCI”) (“Plaintiff”) first amended complaint (“FAC”) in its entirety on the grounds that the person who filed the pleading does not have legal capacity to sue, the FAC fails to state facts sufficient to constitute a cause of action, the pleading is uncertain, and it cannot be ascertained from the pleading whether the contract is written, oral, or implied by conduct.  (Demurrer, pg. 1; C.C.P. §§430.10(b), (e), (f), (g).) 

Request for Judicial Notice

Defendant’s 9/19/22 request for judicial notice of the search results for “Car Consultants Inc.” from the Secretary of State of Nevada Business Entity Search website (D-RJN, Exh. 1); the search results for “National Robertson Carwash Care, Inc.” and articles of incorporation showing the formation date from the Secretary of State of California Business Entity Search website (D-RJN, Exh. 2); and the stipulated judgment in Los Angeles Superior Court Case No. 22SMCV00232 signed by Car Consultants, Inc. and National Robertson Carwash Care, Inc. (D-RJN, Exh. 3) is granted.

Background

On May 13, 2022, Plaintiff filed its complaint against Defendant in the instant action.  On August 30, 2022, Plaintiff filed the operative FAC alleging eight causes of action: (1) intentional interference with contractual relationship, (2) intentional interference with prospective economic advantage, (3) negligent interference with prospective economic advantage, (4) breach of contract, (5) breach of good faith and fair dealing, (6) breach of covenant of quiet enjoyment, (7) constructive eviction, and (8) declaratory relief arising from alleged Defendant landlord and Plaintiff tenant’s car wash lease agreement for the car wash portion of real property at 3071 S. Robertson Blvd., Los Angeles, CA 90034 (“Subject Property”).   (See FAC.)   Defendant filed the instant demurrer to Plaintiff’s FAC on September 19, 2022.  On March 2, 2023, Plaintiff filed its opposition.  As of the date of this hearing, Defendant has not filed a reply.

          Summary of Allegations

Plaintiff alleges on or about November 21, 2014, Car Consultant Inc. entered into a car wash lease agreement (“Lease Agreement”) with Defendant for the car wash portion of the Subject Property.  (FAC ¶7, Exh. 1.)  Plaintiff alleges Car Consultant Inc. was entitled to use the entire car wash portion of the Subject Property, which include the vacuum area, the car wash tunnel, including entrance and exit areas, office, two storage rooms, electric room, employee restroom, drying, parking and detail area adjacent to the tunnel exit; the parking space directly east of the air and water area; and one parking space adjacent to the trash area before the car wash tunnel.  (FAC ¶8.)  Plaintiff alleges the parties agreed to transfer Car Consultant Inc.’s rights under the Lease Agreement to Plaintiff, that the actions were ratified by Defendants, and since then, Plaintiff has been in possession of the Subject Property and paid any rent previously owned [sic].  (FAC ¶9.)  Plaintiff alleges Defendant, without notice, substantially reduced Plaintiff’s use of the Subject Property by eliminating a lane for ingress to the car wash tunnel and the drying, parking, and detailing areas, and notwithstanding this reduction in services, Defendant continued to charge Plaintiff rent which exceeded the terms of the Lease Agreement.  (FAC ¶10.)  Plaintiff alleges when it invoked its rights under the Los Angeles Commercial Eviction Moratorium, Defendant retaliated by filing an unlawful detainer for nonpayment of rent, and Plaintiff was left with no choice but to vacate the Subject Property.  (FAC ¶10.) 

Plaintiff alleges in October 2020, Defendant found a buyer for Plaintiff to sell the car wash business to, Armen Takayan (“Takayan”) or his assignee.  (FAC ¶11.)  Plaintiff alleges Defendant represented that Takayan was a bona fide purchaser, and that Defendant would meet any and all obligations necessary to proceed forward with the sale.  (FAC ¶12.)  Plaintiff alleges that based on Defendant’s representation, in or about October 2020, Plaintiff and Takayan executed a written purchase agreement, wherein Plaintiff would sell the car wash business subject to the Lease Agreement to Takayan for $500,000.00.  (FAC ¶13.)  Plaintiff alleges that shortly thereafter, Defendant unreasonably refused to perform his obligations necessary to close the sale.  (FAC ¶14.)  Plaintiff alleges it and Takayan were left with no choice but to cancel the sale.  (FAC ¶15.)   

Demurrer

In support of his demurrer to Plaintiff’s FAC, Defendant argues Plaintiff’s FAC fails because (1) Plaintiff is not a legal entity entitled to bring this action; (2) the FAC fails to state facts sufficient to constitute a cause of action against Defendant; (3) the allegations in the FAC are uncertain; and (4) the alleged agreement to transfer the rights of Car Consultants Inc. to Plaintiff is not properly alleged.  (Demurrer Memorandum, pg. 2.)

Legal Standard

A demurrer is a pleading used to test the legal sufficiency of other pleadings, i.e., it raises issues of law, not fact, regarding the form or content of the opposing party’s pleading (complaint, petition, answer, or cross-complaint).  (C.C.P. §§422.10, 589; see Donabedian v. Mercury Insurance Co. (2004) 116 Cal.App.4th 968, 994 [citing text]; Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388 [citing text].)

A demurrer can be used only to challenge defects that appear on the face of the pleading under attack; or from matters outside the pleading that are judicially noticeable.  (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian, 116 Cal.App.4th at pg. 994 [citing text].)

Legal Capacity to Sue

The Court may take notice of official acts of any state, county, or federal legislative, executive or judicial department.  (Evid. Code §452(c).)

Defendant argues Plaintiff National Robertson Carwash Care Inc., a California Corporation, was not an entity in existence when the lessee, Car Consultants, Inc., was terminated in the state of Nevada.  (Demurrer Memorandum, pg. 3.)  Defendant argues Car Consultants, Inc. was formed in 2014 but failed to file a 2015 annual report and was subsequently terminated in or about 2016.  (D-RJN, Exh. 1.)  Defendant argues Plaintiff was not formed until 2017.  (D-RJN, Exh. 2.)  Defendant argues there is no way that Car Consultants, Inc. could have effectively transferred its rights under the lease to Plaintiff before 2017, and therefore, Plaintiff does not have the capacity to sue as a lessee under the Lease Agreement.

Defendant’s argument fails on the basis that Plaintiff alleged sufficient facts in the FAC that through the course of performance the Lease Agreement was transferred to Plaintiff.  (FAC ¶¶7-9; see Com. Code §1303 [“(a) A ‘course of performance’ is a sequence of conduct between the parties to a particular transaction that exists if: (1) the agreement of the parties with respect to the transaction involves repeated occasions for performance by a party; and (2) the other party, with knowledge of the nature of the performance and opportunity for objection to it, accepts the performance or acquiesces in it without objection.”].)  In a demurrer, the allegations in Plaintiff’s FAC that the Lease Agreement was transferred to Plaintiff in the course of performance are construed as true.

Based on the foregoing, Defendant’s demurrer to Plaintiff’s FAC is overruled.

Failure to State a Claim

          Entire FAC

“A written contract may be pleaded either by its terms—set out verbatim in the complaint or a copy of the contract attached to the complaint and incorporated therein by reference—or by its legal effect. [Citation.] In order to plead a contract by its legal effect, plaintiff must ‘allege the substance of its relevant terms. This is more difficult, for it requires a careful analysis of the instrument, comprehensiveness in statement, and avoidance of legal conclusions.”  (Heritage Pacific Financial, LLC v. Monroy (2013) 215 Cal.App.4th 972, 993, citations omitted.)

Defendant argues Plaintiff’s FAC fails to attach the alleged assignment or plead its terms verbatim and therefore fails to state sufficient facts to constitute a cause of action.  (Demurrer Memorandum, pg. 4.)

Plaintiff’s FAC fails to allege the alleged assignment or plead its terms verbatim.  (C.C.P. §430.10(g).)  Plaintiff’s argument that it sufficiently alleged the lease transferred by the acts of the parties by the course of performance in FAC ¶¶7-9 is unavailing.  Plaintiff merely alleges the following conclusory legal assertion: “The parties agreed to transfer Car Consultant Inc.’s rights under the Lease Agreement to [Plaintiff]. These actions were ratified by [Defendant]. Since then, [Plaintiff] has been in possession of the Subject Property and had paid any rent previously owned [sic].”  (FAC ¶9.)  Plaintiff does not allege how Defendant’s ratification took place, fails to recite the terms of the modification, and fails to allege whether the modification of the least was written, oral, or implied.

Based on the foregoing, Defendant’s demurrer to Plaintiff’s FAC is sustained with 20 days leave to amend.

Dated:  March ____, 2023

Hon. Monica Bachner

Judge of the Superior Court