La Donna M. Lucas v. Bank of America, N.A., et al.

DEMURRER TO COMPLAINT

 

MOVING PARTY: Defendant Bank of America, N.A.

RESPONDING PARTY(S): Plaintiff La Donna M. Lucas

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

Plaintiff La Donna M. Lucas brings this action against Defendant Bank of America, N.A., for alleged fraud, breach of contract, and unfair business practices. Plaintiff is disputing the terms of her mortgage loan with Defendant.

Defendant now demurrers to each cause of action in the Complaint. Plaintiff opposed.

TENTATIVE RULING:

Defendant’s Demurrer to the Complaint is SUSTAINED.

Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) Based on the fact that Plaintiff knew the terms of the mortgage loan in 2010, it would appear unlikely that Plaintiff can allege delayed discovery or some other equitable doctrine to toll the statute of limitations, as needed. Be that as it may, Plaintiff will be given the opportunity at the hearing to make an “offer of proof” to show that she can plead, in good-faith, delayed discovery of the alleged fraud. If she cannot, no leave to amend will be given. 

Moving party is ordered to give notice.

DISCUSSION:

Demurrer

I. Meet and Confer

Plaintiff is ordered to provide Defendant with a valid means of contact (phone or email) for all communications going forward.

II. Timing

As an initial matter, Plaintiff contends in opposition that Defendant’s demurrer was untimely. 

“A person against whom a complaint or cross-complaint has been filed may, within 30 days after service of the complaint or cross-complaint, demur to the complaint or cross-complaint.” (CCP § 430.40(a).) Additionally, “[i]f the parties are not able to meet and confer at least 5 days before 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…” (§ 430.41(a)(2).)

Here, while there is no proof of service in the court docket, Defendant represents that it was served with the Complaint on October 16, 2024. On November 15, 2024—30-days after service—Defendant filed a declaration for a 30-day extension to file a responsive pleading. With the 30-day extension, the date to file a responsive pleading fell on December 15, 2024. Because this was a Sunday, the day to respond was extended to the following day, December 16, 2024. (See CCP § 12a(a), § 10.) Defendant filed the demurrer on that date, and it is therefore timely. 

Alternatively, to the extent the demurrer is untimely, it is well-settled that a trial court has discretion to consider an untimely demurrer. (See Jackson v. Doe (2011) 192 Cal. App. 4th 742, 749.) Under the circumstances here, including the absence of any undue prejudice to Plaintiff if the demurrer is heard at this time, the court exercises is discretion to consider it.

III. Legal Standard

A demurrer for sufficiency tests whether the complaint states a cause of action.  (Hahn v. Mirda (2007) 147 Cal. App. 4th 740, 747.)  When considering demurrers, courts read the allegations liberally and in context.  (Taylor v. City of Los Angeles Dept. of Water and Power (2006) 144 Cal. App. 4th 1216, 1228.)  In a demurrer proceeding, the defects must be apparent on the face of the pleading or by proper judicial notice.  (CCP § 430.30(a).)  A demurrer tests the pleadings alone and not the evidence or other extrinsic matters.  (SKF Farms v. Superior Court (1984) 153 Cal. App. 3d 902, 905.)  Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.  (Id.)  The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.  (Hahn, 147 Cal.App.4th at 747.)

IV. Analysis 

First, Defendant argues each cause of action is barred by the applicable statute of limitations. 

“The statute of limitations usually commences when a cause of action ‘accrues,’ and it is generally said that ‘an action accrues on the date of injury.’ [Citation.]  Alternatively, it is often stated that the statute commences ‘upon the occurrence of the last element essential to the cause of action.’”  (Bernson v. Browning-Ferris Indus. (1994) 7 Cal. 4th 926, 931.)  As the California Supreme Court has explained: “In a long line of cases we have held that a cause of action for fraud or mistake accrues, and the limitations period commences to run, when the aggrieved party could have discovered the fraud or mistake through the exercise of reasonable diligence.” (Sun’n Sand, Inc. v. United Cal. Bank (1978) 21 Cal. 3d 671, 701.)

Plaintiff alleges that from “2003 through 2008, Defendant Bank of America…developed and implemented a program of systemic banking fraud…” (Compl. ¶ 1.) In 2009, Defendant allegedly “induc[ed] Plaintiff to enter into a mortgage” with Bank of America. (Id. ¶ 3.) As of August 2024, Plaintiff has paid $128,702.34 on the loan. (Id. ¶ 4.) Plaintiff has “never missed a payment and was never late with making the payment.” (Id.)

Plaintiff alleges that on March 4, 2024, she disputed Defendants’ claim that she owes an additional $57,068.75 for the payoff. (Id. ¶ 5.) Plaintiff is disputing “the terms of the loan transaction,” the “illegally high Annual Percentage Rate (APR) of 6.125%,” the “$100,706.54 interest,” the “entire Truth in Lending Disclosure Statement,” the “Amortization Schedule,” and “any other documents related to this transaction.” (Id.) Plaintiff alleges that “she owes the Defendants zero balance,” and should actually be refunded $9,399.53. (Id.)

The Statute of Limitations period for a cause of action for fraud is three years. (Broberg v. The Guardian Life Ins. Co. of Amer. (2009) 171 Cal.App.4th 912, 920 (citing Code Civ. Proc., § 338, subd. (d)). “A four-year limitations period applies to claims based on written contracts.” (Church v. Jamison (2006) 143 Cal.App.4th 1568, 1577 (citing Code Civ. Proc., § 337(1)). To the extent Plaintiff asserts a cause of action for unfair business practices under the UCL, the statute of limitations is four years. (Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal.4th 1185, 1192.)

As the court understands the allegations, Plaintiff is disputing the terms of her mortgage, which she contends are fraudulent or predatory. However, these terms were established in 2009 or 2010 when Plaintiff entered into the relevant agreement(s) with Defendant. (Compl. ¶ 14.)  Therefore, on the face of Complaint, each cause of action is time-barred under each relevant statute of limitations. 

This court is mindful that a cause of action for fraud “is not to be deemed to have accrued until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.” (Brandon G. v. Gray (2003) 111 Cal.App.4th 29, 35.) Here, however, it appears Plaintiff was aware of the fraud—including the allegedly unlawful APR—at the time she was presented with these documents. Because that occurred in 2010, the three-year and four-year statute of limitations have long expired. 

Accordingly, Defendant’s Demurrer to the Complaint is SUSTAINED.

Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) Based on the fact that Plaintiff knew the terms of the mortgage loan in 2010, it would appear unlikely that Plaintiff can allege delayed discovery or some other equitable doctrine to toll the statute of limitations. Be that as it may, Plaintiff will be given the opportunity at the hearing to make an “offer of proof” to show that she can plead delayed discovery of the alleged fraud. If she cannot, no leave to amend will be given. 

IT IS SO ORDERED.

Dated:   January 31, 2025 ___________________________________

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept49@lacourt.org by no later than 4:00 p.m. the day before the hearing.  All interested parties must be copied on the email.  It should be noted that if you submit on a tentative ruling the court will still conduct a hearing if any party appears. By submitting on the tentative you have, in essence, waived your right to be present at the hearing, and you should be aware that the court may not adopt the tentative, and may issue an order which modifies the tentative ruling in whole or in part.