Judge: Randy Rhodes, Case: 21CHCV00316, Date: 2023-03-09 Tentative Ruling
Case Number: 21CHCV00316 Hearing Date: March 9, 2023 Dept: F51
Dept. F-51¿
Date: 3/9/23
Case #21CHCV00316
¿
DEMURRER
Demurrer without Motion to Strike Filed: 12/12/22
MOVING PARTY: Defendant/Cross-Complainant Krupe
Investments, Inc., a Delaware corporation registered in California (“Moving Defendant”)
RESPONDING PARTY: Plaintiff/Cross-Defendant Lucy
Holdings, LLC, a Wyoming limited liability company (“Plaintiff”)
NOTICE: OK
RELIEF REQUESTED: Moving Defendant demurs to Plaintiff’s
entire second amended complaint (“SAC”).
TENTATIVE RULING: The demurrer is overruled. Moving
Defendant’s Request for Judicial Notice (RJN) is granted as to Nos. 1, 4, 6, 7,
9, and 15, and denied as to Nos. 2, 3, 5, 8, 11, and 14.
At the outset, both D’s demurrer and RJN are somewhat
unintelligible – with regard to the RJN, D has not made any argument that any
of the materials attached thereto should be judicially noticed. Moreover, the
exhibits are not bookmarked, nor is every requested item attached as an
exhibit. The exhibits themselves are missing pages, out of order, and some
contain documents which are not cited to in the text of the RJN.
Moving Defendant is reminded to review the 5/3/19 First
Amended General Order Re Mandatory Electronic Filing for Civil.¿When e-filing
documents, parties must comply with the “TECHNICAL REQUIREMENTS” which are set
forth at page 4, line 4 through page 5, line 12 of the Court’s 5/3/19 First
Amended General Order Re Mandatory Electronic Filing for Civil (particularly
bookmarking declarations and exhibits). (CRC 3.1110(f)(4).) Failure to comply
with these requirements in the future may result in papers being rejected,
matters being placed off calendar, matters being continued so documents can be
resubmitted in compliance with these requirements, documents not being
considered and/or the imposition of sanctions.
BACKGROUND
This quiet title action arises out
of a dispute over certain property located at 28212 Kelly Johnson Parkway,
Santa Clarita, California 91355 (the “Subject Property”). Plaintiff alleges
that a 12/2/20 deed of trust was fraudulently executed and recorded between the
two commonly owned and controlled entities, Moving Defendant and nonmoving
defendant Roshmore Development, Inc. (“Roshmore”), and subsequently foreclosed
on by Moving Defendant. (SAC ¶¶
45, 48, 69.)
On 4/23/21, Plaintiff filed its
original complaint in this action alleging a cause of action for declaratory
relief/quiet title against Moving Defendant and nonmoving defendant Witkin & Associates, LLC (“Witkin”), the foreclosure
trustee (collectively, “Defendants”) and a cause of action for fraud
against Moving Defendant. On 8/2/21, this Court overruled Defendants’ demurrer
as to the declaratory relief/quiet title cause of action and sustained the
demurrer, with leave to amend, as to the fraud cause of action.
8/23/21, Plaintiff filed its First
Amended Complaint (“FAC”), asserting a single cause of action for declaratory
relief/quiet title. On 11/5/21, the Court overruled Defendants’ demurrer to
Plaintiff’s FAC.
On 11/7/22, Plaintiff filed its
SAC, alleging against Defendants the following causes of action: (1)
Declaratory Relief/Quiet Title; (2) Slander of Title; and (3) Conspiracy to
Slander Title. On 12/12/22, Moving Defendant filed the instant demurrer and
request for judicial notice. On 2/24/23, Plaintiff filed its opposition. No
reply has been filed to date.
ANALYSIS
Meet-and-Confer
Before filing its demurrer, “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.” (Code Civ. Proc. § 430.41, subd.
(a).) The demurring party
must file and serve a meet and confer declaration stating either: “(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;” or “(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.” (Id. at subd. (a)(3).)
Here, counsel for Moving Defendant
declares that he sent Plaintiff’s counsel a meet and confer email on 12/2/22
regarding the issues raised in the demurrer, and the parties discussed further
on 12/5/22, but were unable to come to a resolution. (Decl. of Eric Rasmussen, ¶¶ 1–2.) Therefore, counsel
has satisfied the preliminary meet and confer requirements of Code of Civil
Procedure section 430.41, subdivision (a).
Legal Standard
As a general matter, a¿party may
respond to a pleading against it by demurrer on the basis of any single or
combination of eight enumerated grounds, including¿that¿“the pleading does not
state facts sufficient to constitute a cause of action” or is uncertain,
meaning “ambiguous and unintelligible.” (Code Civ. Proc., § 430.10, subds. (e)
and (f).)
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 pleading alone, and not the evidence or facts
alleged.” (E-Fab, Inc.¿v.¿Accountants, Inc. Servs.¿(2007) 153
Cal.App.4th 1308, 1315.) As such, the court assumes the truth of the
complaint’s properly pleaded or implied factual allegations. (Ibid.) The
only issue a demurrer is concerned with is whether the complaint, as it stands,
states a cause of action. (Hahn v. Mirda¿(2007) 147 Cal.App.4th 740,
747.)
Here, Moving Defendant¿demurs to
Plaintiff’s SAC pursuant Code of Civil Procedure section 430.10, subdivisions¿(e)
and (f),¿arguing that the pleading fails¿to allege facts sufficient to¿state¿a
cause of action for Declaratory Relief/Quiet Title against it, and is uncertain.
Moving Defendant also realleges that Plaintiff lacks the standing to bring the
instant action, another action is pending involving the same parties, issues,
and property, and that the transaction sued upon is void ab initio.
A.
Declaratory Relief/Quiet Title Cause of
Action
“A party demurring to a pleading
that has been amended after a demurrer to an earlier version of the pleading
was sustained shall not demur to any portion of the amended complaint,
cross-complaint, or answer on grounds that could have been raised by demurrer
to the earlier version of the complaint, cross-complaint, or answer.” (Code
Civ. Proc. § 430.41, subd. (b).)
As the Court previously stated in
overruling Defendants’ demurrer to Plaintiff’s FAC: “The sole basis set forth
in Defendants’ demurrer to the original complaint as to the declaratory
relief/quiet title cause of action was that Witkin and Associates, LLC was not
a proper party to the cause of action because it has no interest in or
ownership of the Property. (See 8/2/21 Minute Order). Defendants now improperly
demur to declaratory relief/quiet title cause of action on different grounds
which could have been raised by the demurrer to the original complaint. See
Code of Civil Procedure Section 430.41(b). Even if the demurrer on these
additional grounds was proper at this point in time, it would be overruled on
the merits.” (11/5/21 Minute Order, p. 2.)
Here, the same holds true. Moving
Defendant essentially makes the same arguments as previously asserted in its
demurrer to the FAC, thus the instant demurrer is improper under Code of Civil
Procedure section 430.41, subdivision (b).
As previously stated by the Court,
“Plaintiff has sufficiently alleged the claim for quiet title. Whether
Plaintiff has good title to the Property is what is to be determined in this
action. Additionally, Plaintiff’s allegation that the grant deed transferring
the Property from Roshmore to Plaintiff forms the basis of the quiet title
claim. (First Amended Complaint ¶34). The deed is dated November 19, 2020.
(First Amended Complaint, Exhibit 2). For purposes of Code of Civil Procedure
Section 761.020(d), the date of which a determination is sought is the date of
the filing of the complaint, or another date, if the plaintiff so alleges. See
Deutsche Bank National Trust Company (2012) 206 CA4th 201, 213. Similarly, the
declaratory relief claim seeking to quiet title is properly stated. See Code of
Civil Procedure Section 1060.” (11/5/21 Minute Order, p. 3.)
Based on the foregoing, the Court
overrules the instant demurrer as to Plaintiff’s first cause of action for
declaratory relief/quiet title.
B.
Standing
Moving Defendant argues that
Plaintiff has no standing to being the instant action because it has no
interest in the Subject Property. On the contrary, Plaintiff has alleged in its
SAC that it was deeded a Grant Deed to the Subject Property by Roshmore on 11/19/20.
(SAC ¶ 43.) This
assertion is further substantiated by the Grant Deed attached as Exhibit O to
Moving Defendant’s RJN.
Moving Defendant further argues
that the 11/19/20 transfer of the Subject Property to Plaintiff is void ab
initio for violation of Delaware General Corporations Law section 271,
subdivision (a)(1) because Roshmore’s shareholders were not notified thereof,
and its board of directors did not vote to approve the transfer. (Dem.
12:7–23.)
Plaintiff argues in opposition that
“it is not established that Delaware law would even apply here to govern an LLC
registered in California and as to real property located in the State of
California.” (Pl.’s Opp., 4:14–16.) Moreover, Plaintiff has alleged in its SAC
that Roshmore and Moving Defendant are alter ego companies with the same sole
shareholder and director. (SAC ¶¶
11, 13.)
The Court notes that Moving
Defendant has made various additional factual allegations to argue that
Plaintiff lacks standing to bring this action, but declines to reach the merits
of these arguments at the demurrer stage. As previously stated, it is
sufficient that Plaintiff has properly alleged its interest in the Subject
Property, affording it the basis to bring the cause of action to quiet title.
Based on the foregoing, Defendant
has failed to establish that the transfer of the Subject Property to Plaintiff
is void as a matter of law. “Whether Plaintiff will ultimately prevail on its
claim cannot be determined on demurrer.” (11/5/21 Minute Order, p. 3.)
Accordingly, the demurrer is overruled on this ground.
C.
Separate Pending Action
Moving Defendant further argues
that the demurrer should be sustained because there exists another pending
action involving the same parties, case, property, and issues. (Dem. 15:7–21.)
A party may demur to a complaint if “there is another action pending between
the same parties on the same cause of action.” (Code Civ. Proc. § 430.10, subd. (c).)
Moving Defendant cites to LASC Case
No. 20CHCV00631, a Breach of Contract action brought by Mark A. Liker against
nonmoving defendants Cochrane, Inc. and Roshmore. Moving Defendant also cites
to LASC Case No. 22STCV13647, an action for (1) Breach of Contract; (2) Quantum
Meruit; and (3) Express and Implied Indemnity brought by nonmoving defendant
Eliezer Appel against Mark A. Liker, Airlux Aircraft, Inc., and LG Aviation
Inc.
The Court finds that neither of the
above-mentioned cases involve the same parties nor the same causes of action as
in the instant action. In accordance with the Court’s previous finding, “there
is no other action pending between Plaintiff and Defendants.” (11/5/21 Minute
Order, p. 2.) Accordingly, the demurrer is overruled on this ground.
Generally speaking, “demurrers for
uncertainty are disfavored and thus are strictly construed because ambiguities
can reasonably be clarified under modern rules of discovery. Such demurrers are
granted only if the pleading is so incomprehensible that defendant cannot
reasonably respond.” (Cal.Jur.3d § 137.) “Where the complaint contains
substantive factual allegations sufficiently apprising defendant of the issues
it is being asked to meet, a demurrer for uncertainty should be overruled or
plaintiff given leave to amend.” (Williams v. Beechnut Nutrition Corp.
(2011) 185 Cal.App.3d 135, 139 fn.2.)¿¿
Here, Moving Defendant argues that
Plaintiff’s entire SAC is uncertain pursuant to Code of Civil Procedure section
430.10, subdivision (f). In applying the stringent standard for demurrers filed
on this ground, the Court finds that the SAC is not “so incomprehensible” that
Moving Defendant cannot respond, especially given the extensive analyses it has
offered in attacking the pleading. Accordingly, the demurrer is overruled on
this ground.¿
CONCLUSION
The demurrer is overruled.