Judge: Robert B. Broadbelt, Case: 23STCV00230, Date: 2024-04-12 Tentative Ruling

Case Number: 23STCV00230    Hearing Date: April 12, 2024    Dept: 53

Superior Court of California

County of Los Angeles – Central District

Department 53

MOVING PARTY:                 Defendant Susan Caldwell a/k/a Caldwell Law Group           

RESPONDING PARTY:        Plaintiff Aaron Celious

Demurrer to First Amended Complaint

The court considered the moving papers filed on December 8, 2023, in connection with this demurrer.

The court did not consider the “[Amended] Demurrer to the Plaintiff’s First Amended Complaint Pursuant to CCP §430.10,” filed by defendant Susan Caldwell aka Caldwell Law Group on March 27, 2024.  The amended demurrer was not served on plaintiff Aaron Celious at least 16 court days (plus two court days for electronic service) before the hearing on this demurrer in violation of Code of Civil Procedure sections 1005, subdivision (b) and 1010.6, subdivision (a)(3)(B).  (Amended Demurrer, p. 28 [proof of electronic service of amended demurrer on March 22, 2024, i.e., 14 court days before the hearing].) 

Although the moving defendant asserts that the amended version is substantially identical to the original demurrer, except that it corrects the citations to the operative complaint and removed some arguments, it appears that the moving papers make a number of changes.  (Def. Mar. 25, 2024 Notice of Errata, p. 2:5-10.)  Specifically, it appears that the amended demurrer makes many stylistic changes, and includes authorities not included in the original demurrer.  For example, the amended demurrer filed on March 27, 2024 adds footnote 1, which was not set forth in the original demurrer.  (Amended Demurrer, p. 7, n. 1.)  The amended demurrer also argues that there was no lawful assignment of claims and that the exception to California’s prohibition of assignment of legal malpractice claims does not apply, citing White Mountains Reinsurance Co. of Am. v. Borton Petrini, LLP (2013) 221 Cal.App.4th 890.  (Amended Demurrer, pp. 7:19-23, 17:15-21.)  However, the original demurrer filed on December 8, 2023 does not include this argument or authority.  (Demurrer, pp. 7:15-21, 14:15-25.)

Thus, the court finds that (1) the amended demurrer contains substantive changes from the original demurrer, and (2) therefore the amended demurrer should have been filed and served at least 16 court days (plus two court days for electronic service) on plaintiff Aaron Celious before the hearing.  Because the amended demurrer was not filed and served with the notice required by Code of Civil Procedure section 1005, subdivision (b), the court has not considered that filing.

The court did not consider the “Opposition to Demurrer,” filed by plaintiff Aaron Celious on April 10, 2024, because it was not filed and served at least nine court days before the hearing as required by Code of Civil Procedure section 1005, subdivision (b).  

REQUEST FOR JUDICIAL NOTICE

The court grants defendant Susan Caldwell a/k/a Caldwell Law Group’s request for judicial notice.  (Evid. Code, § 452, subd. (d).)  The court notes that it does not take judicial notice of the truth of the matters asserted therein.  (Arce v. Kaiser Foundation Health Plan, Inc. (2010) 181 Cal.App.4th 471, 482 [“the truth of matters asserted in [court documents] is not subject to judicial notice”].)

DISCUSSION

Plaintiff Aaron Celious (“Plaintiff”) filed the operative First Amended Complaint in this action against defendants Susan L. Caldwell and Caldwell Law Group on October 9, 2023, alleging five causes of action for (1) professional negligence (legal malpractice); (2) breach of contract; (3) breach of fiduciary duty; (4) constructive fraud; and (5) conversion.

Defendant Susan Caldwell a/k/a Caldwell Law Group (“Defendant”) now moves the court for an order sustaining her demurrer to each cause of action alleged by Plaintiff in his First Amended Complaint.

The court overrules Defendant’s demurrer to the First Amended Complaint in its entirety on the ground that Plaintiff does not have standing to bring this action because (1) Plaintiff has expressly alleged—and therefore the court must accept as true—that he entered into a representation agreement with Defendant “that specifically named [Plaintiff] as the Client[,]” and therefore has alleged facts to establish that he has standing to assert legal malpractice claims against Defendant, and (2) even if Defendant had shown that the allegations establish that Plaintiff was not a client of Defendant’s, Defendant did not present evidence or argument showing that Plaintiff would not have standing to allege claims other than legal malpractice against Defendant.  (Code Civ. Proc., § 430.10, subd. (e); FAC ¶¶ 22-23, 107 [“Plaintiff was the named client in the Contract for legal services in the Unison matter”]; Borissoff v. Taylor & Faust (2004) 33 Cal.4th 523, 529 [“an attorney will normally be held liable for malpractice only to the client with whom the attorney stands in privity of contract, and not to third parties”] [emphasis added].)

The court overrules Defendant’s demurrer to the first cause of action for professional negligence (legal malpractice) because it states facts sufficient to constitute a cause of action.  (Code Civ. Proc., § 430.10, subd. (e).)

As a threshold matter, the court notes that Defendant has organized the demurrer’s arguments into three sections: (1) lack of standing (discussed above), (2) the sufficiency of the “Unison Claims,” and (3) the sufficiency of the “Shah Claims.”  (Demurrer, pp. 14:15 [Sec. IV, Standing], 15:2 [Sec. V, Unison Claims], 20:10 [Sec. VI, Shah Claims].)  As to the sufficiency of the Unison Claims, it appears that Defendant has challenged the claims insofar as they allege legal malpractice.  Defendant has not specifically addressed the second through fifth causes of action.  Thus, the court evaluates Defendant’s argument regarding the Unison Claims in the context of the first cause of action for professional negligence (legal malpractice) only.

First, the court finds that Defendant has not shown that this cause of action is barred by the statute of limitations.

“An action against an attorney for a wrongful act or omission, other than for actual fraud, arising in the performance of professional services shall be commenced within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first.”  (Code Civ. Proc., § 340.6, subd. (a).)  However, that time period “shall be tolled during the time that any of the following exist: [¶¶] (2) The attorney continues to represent the plaintiff regarding the subject matter in which the wrongful act or omission occurred.”  (Code Civ. Proc., § 340.6, subd. (a)(2).)  

The court acknowledges that Plaintiff has alleged that (1) he executed a retainer agreement with Illinois counsel on August 9, 2019, (2) Illinois counsel litigated the Unison action on Plaintiff’s behalf from August 2019 and January 2022, and (3) Defendant “had limited involvement with the case after August 2019.”  (FAC ¶¶ 57, 61, 58.)  However, these allegations appear to indicate that Defendant did perform at least some work on behalf of Plaintiff after August 2019, which would toll the one-year period beyond August 2020.  (FAC ¶ 58 [Defendant “had limited involvement with the case after August 2019”]; Code Civ. Proc., § 340.6, subd. (a)(2).)  Whether Defendant performed work only tangentially related to the legal representation was not pleaded in the First Amended Complaint.  (Lockton v. O’Rourke (2010) 184 Cal.App.4th 1051, 1064 [“‘the limitations period is not tolled when an attorney’s subsequent role is only tangentially related to the legal representation the attorney provided to the plaintiff’”].)  Moreover, Defendant has not pointed to any specific matters set forth in the judicially noticed documents establishing that Defendant did not perform work on behalf of Plaintiff in the Unison action after August 2019.  (Demurrer, p. 17:5-6 [referencing court record without citation].)

Thus, while this cause of action may be barred by the one-year statute of limitations, the court finds that Defendant has not shown that this cause of action is necessarily barred.  (Raja Development Co., Inc. v. Napa Sanitary District (2022) 85 Cal.App.5th 85, 92 [“A demurrer based on a statute of limitations will not lie where the action may be, but is not necessarily, barred”] [internal citations and quotations omitted].)

Second, Defendant argues that Plaintiff’s allegations that Defendant should have argued that Maroon was a third-party beneficiary of the Unison contract “is a fundamentally flawed argument.”  (Demurrer, p. 17:17.)  However, Defendant has not addressed Plaintiff’s other allegations that Defendant breached her duty to Plaintiff to use “the skill and diligence needed to overcome the heavy burden of ‘forum selection’” by failing to show “that enforcing the Illinois forum selection clause of the subcontract would be unreasonable due to fraud or undue influence, California public policy, or prohibitive difficulty.”  (FAC ¶ 43.)  Thus, Defendant has not shown that the entire cause of action for legal malpractice based on the alleged failure to successfully defend against the motion to transfer fails.  (PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682 [“A demurrer does not lie to a portion of a cause of action”].)

            Third, although Defendant contends that Plaintiff has not pleaded actual injury, the court disagrees.  Plaintiff has alleged that, as a result of Defendant’s conduct, Plaintiff’s action was transferred to Illinois “where a settlement was reached for far less than what Plaintiff would have been able to secure[.]”  (FAC ¶¶ 20, 62 [Defendant knew that transferring the case to Illinois “would reduce the value of the case from both a settlement and trial perspective”], 63 [the settlement with Unison “left Plaintiff in a deficit of $181,218.41”], 110 [Defendant’s conduct “was a substantial factor in Plaintiff’s exceedingly deficient settlement with Unison” and the proper handling of the complaint and opposition to the motion to dismiss or transfer “would have resulted in a collectible judgment or settlement for a much higher amount”]; Namikas v. Miller (2014) 225 Cal.App.4th 1574, 1582 [“The plaintiff must prove, by a preponderance of the evidence, that but for the attorney’s negligent acts or omissions, he would have obtained a more favorable judgment or settlement in the action in which the malpractice allegedly occurred”].)

            The court overrules Defendant’s demurrer to the second cause of action for breach of contract because it states facts sufficient to constitute a cause of action.  (Code Civ. Proc., § 430.10, subd. (e).)

            As a threshold matter, the court notes that it is unclear which causes of action Defendant challenges in section six of the demurrer, entitled “The Shah Claims (Also) Fail to State a Cause of Action.”  Although Defendant briefly mentions the conversion and fraud causes of action (Demurrer, p. 22:3-4), Defendant does not mention any other cause of action.  It appears that Defendant primarily challenges the second cause of action for breach of contract (which is based, in part, on the alleged incompetence in performing professional duties on the part of Defendant in the Shah action).  The court finds that Defendant has not shown that the second cause of action for breach of contract does not state facts sufficient to constitute a cause of action since Defendant has not shown that this cause of action does not allege damages.  (FAC ¶¶ 20, 63, 104.)

Moreover, although Defendant has argued that Plaintiff’s damages fall below the jurisdictional minimum, improper classification is not a ground for demurrer.  (Demurrer, pp. 20:26-1, 22:5-6; Code Civ. Proc., § 430.10 [grounds for demurrer].)

 The court overrules Defendant’s demurrer to the fourth cause of action for constructive fraud because it states facts sufficient to constitute a cause of action since Plaintiff has pleaded facts with the requisite particularity in support of this cause of action.  (Code Civ. Proc., § 430.10, subd. (e); FAC pp. 5:20-6:11 [chart of alleged misrepresentations and dates thereof]; FAC ¶¶ 28, 38, 130-133; Lauckhart v. El Macero Homeowners Assn. (2023) 92 Cal.App.5th 889, 903-904 [describing particularity requirement for fraud].)

The court overrules Defendant’s demurrer to the fifth cause of action for conversion because it states facts sufficient to constitute a cause of action since (1) Plaintiff has pleaded specific facts in support of this cause of action, and (2) Defendant has not argued or shown that Plaintiff did not plead facts establishing any particular element of this cause of action.  (Code Civ. Proc., § 430.10, subd. (e); Lee v. Hanley (2015) 61 Cal.4th 1225, 1240 [elements of conversion claim]; Demurrer, p. 22:3-5 [arguing only that this cause of action does not meet specificity requirement].)

ORDER

            The court overrules defendant Susan Caldwell a/k/a Caldwell Law Group’s demurrer to plaintiff Aaron Celious’s First Amended Complaint.

The court orders defendant Susan Caldwell a/k/a Caldwell Law Group’s to file an answer to plaintiff Aaron Celious’s First Amended Complaint within 20 days of the date of this order.   

            The court orders plaintiff Aaron Celious to give notice of this ruling.

IT IS SO ORDERED.

DATED:  April 12, 2024

_____________________________

Robert B. Broadbelt III

Judge of the Superior Court