Judge Peter A. Hernandez, Case Number: 23PSCV00720, Date: 2023-08-10 Tentative Ruling

Judge: Peter A. Hernandez, Case: 23PSCV00720, Date: 2023-08-10 Tentative Ruling

Case Number: 23PSCV00720 Hearing Date: August 10, 2023 Dept: K

Defendants Wanda International Freight (U.S.A.) and Xiaoyu Liu’s Demurrer to First Amended Complaint is SUSTAINED with leave to amend.

Background

Plaintiff O.E.I. International Inc. (“Plaintiff”) alleges as follows:

On or about April 25, 2022, Xiaoyu Liu (“Liu”), President of Wanda International Freight U.S.A., Inc. (“Wanda”), promised that Wanda would deliver goods Plaintiff entrusted to Wanda to a designated Amazon warehouse; instead, the goods were delivered to a close-by Amazon warehouse.

On March 10, 2023, Plaintiff filed a complaint, later amended, asserting the following causes of action:

1. Fraud and Deceit

2. Breach of Contract

3. Violation of Cal. Bus. & Prof. Code § 17200, et seq.

4. Unjust Enrichment

A Case Management Conference is set for August 10, 2023.

Legal Standard

A demurrer may be made on the grounds that the pleading, inter alia, does not state facts sufficient to constitute a cause of action and/or is uncertain. (Code Civ. Proc., § 430.10, subds. (e) and (f).)

When considering demurrers, courts read the allegations liberally and in context. In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.” (SKF Farms v. Superior Court (1984) 153 Cal.App.3d 902, 905 [citations omitted].) At the pleading stage, a plaintiff need only allege ultimate facts sufficient to apprise the defendant of the factual basis for the claim against him. (Semole v. Sansoucie (1972) 28 Cal. App. 3d 714, 721.) “[A] demurrer does not, however, admit contentions, deductions or conclusions of fact or law alleged in the pleading, or the construction placed on an instrument pleaded therein, or facts impossible in law, or allegations contrary to facts of which a court may take judicial knowledge.” (S. Shore Land Co. v. Petersen (1964) 226 Cal.App.2d 725, 732 [citations omitted].)

Discussion

Wanda and Lui demur, pursuant to Code of Civil Procedure § 430.10, subdivisions (e) and (f), to the first through fourth causes of action in Plaintiff’s First Amended Complaint (“FAC”), on the basis that they each fail to state facts sufficient to constitute a cause of action and are uncertain.

First Cause of Action (i.e., Fraud and Deceit)

“Fraud must be pleaded with specificity…[t]o withstand a demurrer, the facts constituting every element of the fraud must be alleged with particularity, and the claim cannot be salvaged by references to the general policy favoring the liberal construction of pleadings.” (Goldrich v. Natural Y Surgical Specialties, Inc. (1994) 25 Cal.App.4th 772, 782 [emphasis in original].) “This particularity requirement necessitates pleading facts which ‘show how, when, where, to whom, and by what means the representations were tendered.’” (Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 73 (emphasis in original), quoting Hills Trans. Co. v. Southwest (1968) 266 Cal.App.2d 702, 707.)

“The requirement of specificity in a fraud action against a corporation requires the plaintiff to allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.” (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 157.)

Although the FAC alleges more facts, the court finds that it still lacks the requisite specificity. Plaintiff alleges that around 2012 or 2013, Rocky, the owner of Wanda, contacted Sylvia Chiu, the manager of export operation in OEI to obtain shipment delivery from Plaintiff. (FAC ¶ 6.) Rocky represented to Chiu that Wanda shall fulfill the requirement of delivery order, to timely deliver the goods entrusted by OEI to Wanda to the specified destination. (Id.) Further, there appears to be a discrepancy in the amended complaint from the original Complaint, where Plaintiff alleged that Liu, president of Wanda, represented to its manager on April 25, 2022 that “Wanda [shall] deliver the goods entrusted on Wanda by O.E.I., to the designated warehouse of Amazon.” (Compl., ¶ FR-2). The FAC fails to elaborate on this particular representation. Plaintiff does not provide any information as to how, where, and by what means the representation by Liu was tendered. The representation by Rocky is also unspecified as to when it was made and how that representation was tendered.

Defendant’s demurrer to the first cause of action is sustained.

Second Cause of Action (i.e., Breach of Contract)

“[T]he elements of a cause of action for breach of contract are (1) the existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) the resulting damages to the plaintiff.” (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4^th 811, 821.) “If the action is based on an alleged breach of a written contract, the terms must be set out verbatim in the body of the complaint or a copy of the written instrument must be attached and incorporated by reference.” (Otworth v. Southern Pac. Transportation Co. (1985) 166 Cal.App.3d 452, 459.)

The FAC alleges that “[f]rom approximately April 25, 2022, OEI issued at least 5 delivery orders to WANDA with each contains a specified destination for the goods to be delivered (“Delivery Orders”). OEI prepaid the delivery charges to plaintiff. WANDA accepted the Delivery Orders. However, WANDA delivered goods under the Delivery Orders to near-by Amazon fulfillment centers and not the fulfillment centers specified in the Delivery Orders. Since WANDA’s delivery charges are based on the distance of travel, WANDA overcharged OEI at an approximate sum of $ 19,785.00.” (FAC ¶ 18.) Plaintiff refers to at least 5 delivery orders, but only attaches two documents showing one delivery order made on 4/25/22. (Exhib. A.) The attached exhibits do not show the overcharge that Plaintiff claims in the FAC. Plaintiff states that it will amend the complaint when the final sum of overcharge is ascertained, but the Court still finds that Plaintiff has failed to set forth the terms of the oral contract. (FAC ¶ 20.)

Defendant’s demurrer to the second cause of action is sustained.

Third Cause of Action (i.e., Violation of California Business and Professions Code § 17200)

California Business and Professions Code section 17200 prohibits “any unlawful, unfair or fraudulent business act or practice.” (Cal. Bus. & Prof. Code § 17200; see Clark v. Superior Court (2010) 50 Cal.4th 605, 610.) A violation of other laws is deemed independently actionable under the UCL. (See Law Offices of Mathew Higbee v. Expungement Assistance Services (2013) 214 Cal.App.4th 544, 554.) “‘Virtually any law—federal, state or local—can serve as a predicate for a section 17200 action.’” (Id. (quoting Troyk v. Farmers Group, Inc. (2009) 171 Cal.App.4th 1305, 1335).) To establish a fraudulent practice under the UCL, the plaintiff must show that members of the public are likely to be deceived. (See West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 806.) “A business practice is unfair within the meaning of the UCL if it violates established public policy or if it is immoral, unethical, oppressive or unscrupulous and causes injury to consumers which outweighs its benefits.” (McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1473.) Further, Statutory claims must be pled with particularity. (Carter v. Prime healthcare Paradise Valley LLC (2011) 198 Cal.App.4th 396, 410.)

Plaintiff incorporates its allegations from the paragraphs 1-22 in the FAC. The only relevant allegations to this cause of action concern Plaintiff’s fraud and deceit claims, which the Court noted was insufficiently pled. However, even if fraud was sufficiently pled, Plaintiff fails to explain how members of the public are likely to be deceived as a result of Defendant’s unlawful, unfair, or fraudulent business practice.

Defendant’s demurrer to the third cause of action is sustained.

Fourth Cause of Action (Unjust Enrichment)

“Unjust enrichment is not a cause of action, however, or even a remedy, but rather ‘ “ ‘ “a general principle, underlying various legal doctrines and remedies” ’ .... [Citation.] It is synonymous with restitution. [Citation.]” [Citation.]’ Unjust enrichment has also been characterized as describing ‘ “ ‘the result of a failure to make restitution....’ ” ’ [Citation.]” (McBride v. Boughton (2004) 123 Cal.App.4th 379, 387.)

The FAC fails to allege sufficient facts which would entitle it to equitable relief. As discussed above, the FAC does not allege fraud and deceit with particularity. “In keeping with the doctrine's focus on the unjust nature of the enrichment, ‘[i]t is well settled that restitution will be denied where application of the doctrine would involve a violation or frustration of the law or opposition to public policy. [Citations.]’ [Citation.]” (McBride, supra, 123 Cal.App.4th at 387.) The FAC also does not provide any public policy argument or other facts to show Defendants were unjustly enriched at Plaintiff’s expense.

Defendant’s demurrer to the fourth cause of action is sustained.