Judge: Robert B. Broadbelt, Case: 20STCV46095, Date: 2023-02-24 Tentative Ruling

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Case Number: 20STCV46095    Hearing Date: February 24, 2023    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTY:                Defendant Levin Prado

RESPONDING PARTIES:    Plaintiffs Noble Collection, Inc., and The Novel Collection, LLC

Demurrer to Second Amended Complaint

The court considered the moving and opposition papers filed in connection with this demurrer.  No reply papers were filed.

BACKGROUND

On June 29, 2022, plaintiffs Noble Collection, Inc. and The Novel Collection, LLC (“Plaintiffs”) filed the operative Second Amended Complaint in this action against defendants City of Beverly Hills, EIJ, Inc., dba Beverly Hills Watch Company, Jadelle Jewelry and Diamonds, LLC, Jona Rechnitz, and Levin Prado.  Plaintiffs allege five causes of action for (1) replevin, (2) breach of contract, (3) conversion, (4) fraud, and (5) passing checks on insufficient funds.

Defendant Levin Prado (“Defendant”) moves the court for an order sustaining his demurrer to Plaintiffs’ fifth cause of action for passing checks on insufficient funds.

DEMURRER

The court overrules Defendant’s demurrer to the fifth cause of action for passing checks on insufficient funds on the ground of uncertainty because it is not ambiguous or unintelligible.  (Code Civ. Proc., § 430.10, subd. (f).)

The court sustains Defendant’s demurrer to the fifth cause of action for passing checks on insufficient funds because it does not state facts sufficient to constitute a cause of action since Plaintiffs have not alleged facts establishing that Defendant had an enforceable obligation to pay the dishonored checks.  (Code Civ. Proc., § 430.10, subd. (e); Civ. Code, § 1719, subd. (a); Cohen v. Disner (1995) 36 Cal.App.4th 855, 861.)

Civil Code section 1719 provides for the recovery of specified damages from any person who passes a check on insufficient funds.  (Civ. Code, § 1719, subds. (a)(1), (a)(2).)  “‘[T]o pass a check on insufficient funds’ means to make, utter, draw, or deliver any check…for the payment of money” upon any bank or entity that refuses to honor the check due to, inter alia, lack of funds or credit in the account to pay the check.  (Civ. Code, § 1719, subd. (a)(6)(A).)  However, this is not a strict liability statute, and the defendant may raise defenses under the Uniform Commercial Code.  (Cohen, supra, 36 Cal.App.4th at pp. 857, 862; Civ. Code, § 1719, subd. (k) [nothing in this Section is intended to curtail the defenses under Division 3 of the Commercial Code].)  Thus, this section “permits the maker of a dishonored check to prove he has no enforceable obligation to pay the check.”  (Cohen, supra, 36 Cal.App.4th at p. 862.) 

Here, Plaintiffs do not allege facts establishing that Defendant has an enforceable obligation to pay the dishonored checks.  Although Plaintiffs allege that Defendant was one of the individuals that placed the orders to purchase the subject diamonds, the memoranda and invoices state that they were issued to “Jadelle” (i.e., defendant Jadelle Jewelry and Diamonds, LLC).  (SAC ¶¶ 17-18; SAC Exs. C-D; Panterra GP, Inc. v. Superior Court (2022) 74 Cal.App.5th 697 [“Facts appearing in exhibits attached to a complaint are accepted as true and are given precedence over any contrary allegations in the pleadings”].)  Further, the dishonored checks, though signed by Defendant, were made and delivered on behalf of defendant Jadelle Jewelry and Diamonds, LLC.  (SAC Exs. E-F; SAC ¶ 60 [“On or about December 2019, [Defendant] on behalf of [Jadelle Jewelry and Diamonds, LLC], delivered two checks” to Plaintiffs] [emphasis added].)  The court therefore finds that Plaintiffs have not alleged facts establishing that Defendant has an enforceable obligation to pay the amounts due on the checks because the facts alleged establish that (1) the diamonds were purchased by Jadelle Jewelry and Diamonds, LLC, and (2) the checks were made and delivered on behalf of Jadelle Jewelry and Diamonds, LLC, thus making Defendant an intermediary with no obligation to pay the amounts due on the checks. 

The burden is on the plaintiff “to articulate how it could amend its pleading to render it sufficient.”¿ (Palm Springs Villas II Homeowners Assn., Inc. v. Parth (2016) 248 Cal.App.4th 268, 290.)¿ To satisfy that burden, a plaintiff “must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading.”¿ (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.)  The court finds that Plaintiffs have not met their burden of showing how they could amend their cause of action for passing checks on insufficient funds against Defendant.  The court therefore sustains the demurrer without leave to amend.

ORDER

The court sustains defendant Levin Prado’s demurrer to plaintiffs Noble Collection, Inc., and The Novel Collection, LLC’s fifth cause of action for passing checks on insufficient funds without leave to amend.

The court orders defendant Levin Prado to file an answer to the remaining cause of action alleged against him in the Second Amended Complaint within 10 days from the date of service of this order.

The court orders defendant Levin Prado to give notice of this ruling.

IT IS SO ORDERED.

DATED:  February 24, 2023

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court