Judge Ralph C. Hofer, Case Number: 24NNCV02609, Date: 2024-12-13 Tentative Ruling

Plaintiff 911 Housing Solutions alleges that in February of 2023, plaintiff and defendants Oren Gold and Natalie Gold entered into a written lease pursuant to which defendants leased premises in Studio City, and then they entered into possession of the premises pursuant to the agreement.

Plaintiff alleges that plaintiff performed all conditions, covenants and promises on its part to be performed, but that commencing in April of 2023, defendants breached the agreement by refusing and failing to pay rent. Plaintiff alleges that defendants vacated and abandoned the premises in January of 2024. The complaint alleges that as a direct result of defendants’ breaches of the agreement, plaintiff has lost rent in the total sum of $349,358.70, plus interest.

Defendants Oren Gold and Natalie Gold have filed a cross complaint against plaintiff 911 Housing Solutions as cross-defendant, alleging that cross-complainants are a married couple, and the owners of real property, including a single family residence in Westlake Village.

Cross-complainants allege that in February of 2023, a severe and sudden sewage backup occurred in the sewer mainline in the street above the Gold residence, as a result of which raw sewage flooded the entire residence with foul smelling category 3 black water and feces. The cross-complaint alleges that at the same time as the incident, another sewage backup occurred at a neighboring home, so that defendants are informed and believe that the City of Thousand Oaks’ sewer infrastructure is failing. The cross-complaint indicates that the City of Thousand Oaks (the City) is a defendant in a separate prior lawsuit pending in Ventura County, and may be a pending additional cross-defendant in this case, to be determined pursuant to pending discovery.

The cross-complaint alleges that cross-complainants submitted a claim to the City, which agreed it was liable for the damage to the residence, and that the residence required extensive repairs, and provided and encouraged cross-complainants to use alternative housing accommodations leading to the lease agreement for the property in Studio City. Cross-complainants allege that the City agreed to pay for cross-complainant’s temporary housing, but that after paying the first month of temporary housing changed course, and has since refused to pay for any further costs. Cross-complainants allege that due to the City’s refusal to pay, cross-complainants faced eviction from the housing they were led to believe for which they would be paid.

The cross-complaint alleges that cross-defendant 911 Housing Solutions represented to cross-complainants that the property was in good condition, fully furnished and suitable for immediate occupancy, when the property in fact had numerous defects, including non-functioning appliances, plumbing issues, pest infestation, and mold issues. Hence it is alleged that cross-complainants were fraudulently induced to their damage into entering the lease agreement. It is also alleged that these conditions breached the implied warranty of habitability, the covenant of quiet enjoyment, the covenant of good faith and fair dealing, and that they resulted in violations of Civil Code section 1942.4, unfair business practices, and intentionally caused cross-complainants emotional distress.

It is also alleged that cross-defendant engaged in discrimination and violated the Fair Employment and Housing Act as cross-defendant regularly made remarks about cross-complainants’ Jewish race status, and they allegedly made various antisemitic remarks.

The file shows that on September 25, 2024, cross-complainants Oren Gold and Natalie Gold submitted a Request for Enty of Default, requesting Judgment to be entered against cross-defendant 911 Housing Solutions on the cross-complaint in a sum to be determined at a prove up hearing for damages and for costs in the sum of $1,005.00. The default was entered as requested the same date.

There is no meet and confer declaration submitted with the demurrer. CCP § 430.41 requires that before filing a demurrer, the demurring party must submit such a declaration:

“(a) Before filing a demurrer pursuant to this chapter, the demurring party shall meet and confer in person or by telephone with the party who filed the pleading that is subject to demurrer for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer. If an amended complaint, cross-complaint, or answer is filed, the responding party shall meet and confer again with the party who filed the amended pleading before filing a demurrer to the amended pleading.

(1) As part of the meet and confer process, the demurring party shall identify all of the specific causes of action that it believes are subject to demurrer and identify with legal support the basis of the deficiencies. The party who filed the complaint, cross-complaint, or answer shall provide legal support for its position that the pleading is legally sufficient or, in the alternative, how the complaint, cross-complaint, or answer could be amended to cure any legal insufficiency.

(2) The parties shall meet and confer at least five days before the date the responsive pleading is due. If the parties are not able to meet and confer at least five days prior to the date the responsive pleading is due, the demurring party shall be granted an automatic 30-day extension of time within which to file a responsive pleading, by filing and serving, on or before the date on which a demurrer would be due, a declaration stating under penalty of perjury that a good faith attempt to meet and confer was made and explaining the reasons why the parties could not meet and confer. The 30-day extension shall commence from the date the responsive pleading was previously due, and the demurring party shall not be subject to default during the period of the extension. Any further extensions shall be obtained by court order upon a showing of good cause.

(A) The means by which the demurring party met and conferred with the party who filed the pleading subject to demurrer, and that the parties did not reach an agreement resolving the objections raised in the demurrer.

(B) That the party who filed the pleading subject to demurrer failed to respond to the meet and confer request of the demurring party or otherwise failed to meet and confer in good faith.

There is no meet and confer declaration submitted with this demurrer. The demurrer refers to a Phoenix Thottam declaration, but such a declaration is not attached to the copy of the moving papers submitted to the court. Such a declaration is also not attached to the reply. The demurrer attaches what purports to be an email chain, showing three attempts to contact plaintiff’s counsel by telephone, which calls were evidently never picked up or returned. [Ex. A].

Again, this is recitation not part of, or authenticated by, a declaration. The exhibit also does not show that counsel for defendant met defendant’s obligation of identifying with legal support the basis of the deficiencies defendant has identified in the pleading, as required under the statute. The reply again submits the exhibit and argues that defendant’s counsel was left on hold during the various calls. It is not clear why correspondence was not sent to counsel explaining the specific deficiencies and providing the legal support. The reply indicates that the parties did meet and confer on the day before the demurrer was filed, and counsel for defendant “advised” of the “problems relating to Defendant Natalie Gol’s lack of a signature on the subject lease for the case.” [Reply, p.2:14-18]. These facts again are not evidenced by a declaration.

The Court would be within its discretion to continue the matter and require the parties to meet and confer. However, the court requires the parties to meet and confer and submit the required declaration on or before the hearing date, before the matter will be heard.

Defendant Natalie Gold demurs to the sole cause of action of the complaint, for breach of contract, arguing that the complaint fails to allege any facts showing that this defendant specifically was a party to the contract at issue or had any involvement in signing the lease agreement. The demurrer also claims that that the complaint is uncertain and fails to state a cause of action, and that plaintiff’s complaint violates the alleged lease agreement as it has failed in breach of the parties’ agreement to mediate any disputes before filing a court action.

The complaint here alleges that plaintiff and defendants “and each of them,” entered into a written lease, that plaintiff performed, that defendants breached the agreement, and that as a result of the breach, plaintiff suffered damages. [Complaint, paras. 6, 7, 10, 11(second para. 11)].

Plaintiff argues that there is a misjoinder of parties here because there are no facts alleged showing that moving defendant Natalie Gold was a party to the lease agreement described in the complaint.

Plaintiff argues that the pleading refers to an attached lease agreement but fails to allege that plaintiff Natalie Gold was a signatory to this agreement or had any involvement with it.

This assertion seems to be an argument that the attached lease agreement contradicts the clear allegation in the complaint that all defendants were parties to the lease agreement.

Although not cited by plaintiff, it is held that where an incorporated written instrument is the foundation of a cause of action, its recitals may serve as a substitute for direct allegations ordinarily essential to the pleading. Lambert v. Haskell (1889) 80 Cal. 611. Where these recitals are contrary to allegations in the pleading, the recitals will be given precedence, and the pleader’s inconsistent allegations as to the meaning and effect of an unambiguous document will be disregarded. Stoddard v. Treadwell (1864) 26 Cal. 294, 303; See also Mission Oaks Ranch, Ltd. v. Santa Barbara (1998) 65 Cal.App.4th 713, 719 (disapproved on other grounds in Briggs v. Eden Council for Hope and Opportunity (1999) 19 Cal.4th 1106, 1123 n.10).

Here, the lease agreement is attached, and incorporated by reference. [Complaint, para. 6, Ex. 1]. The lease agreement states that the agreement is between plaintiff and “Oren Gold,” as “Tenant.” [Ex. 1, p. 1]. It also states that “The Premises are for the sole use as a personal residence by the following named person(s) only: Oren Gold, Nataly Gold & Family.” [Ex. 1, para. 1 B]. The signatories to the agreement are Oren Gold and plaintiff. [Ex. 1, p. 8].

The opposition argues that there has been no request for judicial notice filed of the lease agreement, but, as discussed above, the lease agreement is attached and incorporated, so that the defect technically appears from the face of the pleading under applicable case law.

The opposition also argues that the demurring defendant is obligated under the contract based on principles of vicarious liability supported by allegations in the pleading of agency and employment.

“Plaintiff is informed and believes, and thereon alleges that each of the defendants is, and at all times herein mentioned was, the agent and employee of each of the remaining defendants, and in doing the things herein alleged, was acting within the course and

scope of such agency and employment. Plaintiff is informed and believes, and thereon alleges that each of the defendants ratified, approved and accepted the benefits of the acts of each of the

Plaintiff relies on Gold v. Gibbons (1960) 178 Cal.App.2d 517, with an incorrect citation in the moving papers and reply of 130 Cal.App.2d 614, 617, in which it was held that the trial court properly had sustained a demurrer to a second amended complaint with leave to amend, where plaintiff declined to further amend. The court of appeal concluded that the complaint was insufficient to allege that a collective bargaining agreement was enforceable against new owners who had not signed the contract and argued there was no privity of contract. The court of appeal noted:

“There can be no contract unless the minds of the parties have met and mutually agreed. German Savings & Loan Soc. v. McLellan, 154 Cal. 710, 99 P. 194; Rancho San Carlos v. Bank of Italy, etc., 123 Cal.App. 291, 11 P.2d 424; Webster v. Parra, 72 Cal.App. 639, 237 P. 804.

Breach of contract cannot be made the basis of an action for damages against defendants who did not execute it and who did nothing to assume its obligations. Galusha v. Fraser, 178 Cal. 653, 174 P. 311; Tiffany & Co. v. Spreckels, 202 Cal. 778, 262 P. 742; Gause v. Pacific Gas & Electric Co., 60 Cal.App. 360, 212 P. 922.”

The court of appeal held that plaintiff “failed to allege any facts which would bring the case within” exceptions, “or to show either an express or implied assumption by” defendants “of the obligations of the agreement.” Gold, at 521.

Gold was a pleading case. Moreover, similarly here the current allegations in the complaint are insufficient to allege facts showing the assumption of the obligations of the lease agreement which moving defendant did not execute as a party.

The opposition relies on legal authority under which allegations of the making of the contract by the principal via an agent need be alleged. However, this allegation in this complaint, consisting merely of an allegation that both defendants entered into the contract, is contradicted by the incorporated lease agreement, and there are no facts alleged suggesting that Oren Gold was acting as agent within the scope of an agency to bind Natalie Gold as principal; the only principal identified as a party and signatory to the contract in the lease agreement itself is Oren Gold. The demurrer is sustained with leave to amend to permit plaintiff to more clearly plead facts and legal theories showing that moving defendant can be held responsible for breach of the subject contract despite her status as a non-signatory.

The opposition also makes a brief argument that while moving defendant claims she is not a party to the contract, she and her co-defendant have filed a cross-complaint in this action which alleges claims for breach of implied covenants of such an agreement, so that on the face of her own allegations in the cross-complaint, she is a party to the contract. This fact is not alleged in the complaint. In addition, there has been no request for judicial notice of the cross-complaint. The material is not before the court, and the argument is not fully developed. The demurrer on this ground is overruled. However, on amendment, plaintiff may include allegations supporting this theory, if appropriate.

Defendant Natalie Gold also argues that plaintiff’s claims are barred in whole or in part because the parties agreed in clause 35 of the lease that they necessarily would first act to mediate any dispute before resorting to court action. Defendant argues that the mediation mandatory step was not taken before plaintiff initiated these proceedings.

“Pursuant to paragraph 35A of the Agreement, Plaintiff has demanded, and hereby demands, that Defendants, and each of them, participate in mediation of the dispute that is the subject of this Complaint, but Defendants, and each of them, have refused and failed to participation in mediation. Plaintiff is informed and believes, and thereon alleges that by such actions in refusing to mediate, Defendants, and each of them, have waived the right to mediate. Plaintiff is informed and believes, and thereon allege that such refusal to mediate was intended to be relied upon by Plaintiff, and that Plaintiff did, in fact rely on such acts of Defendants, and by reason thereof, Defendants are estopped to enforce said mediation clause.”

The demurrer on this ground is accordingly a speaking demurrer, which improperly argues that the complaint’s allegations are false. There is no contradiction pointed out contained in the lease agreement. The allegations of the pleading must be accepted as true for purposes of demurrer. See Serrano v. Priest (1971) 5 Cal.3d 584, 591; Del E. Webb Corp. v. Structural Materials Co. (1981, 2nd Dist.) 123 Cal.App.3d 593, 604 (“As a general rule in testing a pleading against a demurrer the facts alleged in the pleading are deemed to be true, however improbable they may be.”)

There is no meet and confer declaration submitted with this demurrer, as required under CCP § 430.41. The parties are ordered to engage in the required meet and confer before the matter will be called for hearing. Moving defendant is ordered to prepare the required declaration and file it on eCourt before the matter will be called for hearing.

Defendant Natalie Gold’s Demurrer to Plaintiff’s Complaint is SUSTAINED WITH LEAVE TO AMEND on the ground the cause of action for breach of contract is alleged against a non-signatory to the alleged contract, who is not identified as a party to the contract in the incorporated written instrument, and insufficient facts have been alleged establishing a valid theory under which this party can be shown to have assumed the contractual obligations of the subject lease agreement.

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