Judge Robert S. Draper, Case 21STCV11739 2022-12-05 Tentative Ruling

Judge: Robert S. Draper, Case: 21STCV11739, Date: 2022-12-05 Tentative Ruling

Case Number: 21STCV11739 Hearing Date: December 5, 2022 Dept: 47

Tentative Ruling

Judge Theresa M. Traber, Department 47

HEARING DATE: December 5, 2022 TRIAL DATE: NOT SET

CASE: Avraham Bibi v. Roey Burg, et al.

CASE NO.: 21STCV11739

DEMURRER TO COMPLAINT AND MOTION TO STRIKE x2

MOVING PARTY: (1) Defendant Revital Agi; (2) Defendant Eydan Berger

RESPONDING PARTY(S): No response on eCourt as of 11/30/22

CASE HISTORY:

· 03/26/21: Complaint filed

· 08/01/22: Cross-Complaint filed by Roey Burg and ADB Group Inc. as to Avraham Bibi

STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:

This is an action for breach of contract, breach of fiduciary duty, and fraud arising from the breakdown of a joint venture between the parties in the beauty supply and spa business. Plaintiff alleges that Defendants entered into unauthorized partnership agreements and misappropriated company assets.

Defendants Revital Agi and Eydan Berger demur to the Complaint and move to strike portions of the Complaint as improper.

TENTATIVE RULING:

Defendants’ Demurrers to the Complaint are SUSTAINED with leave to amend as to the first and third causes of action with respect to these Defendants and otherwise OVERRULED.

Defendants Motions to Strike are GRANTED. Lines 33:18-20 and 34:14 of the Complaint are ordered stricken.

Plaintiff shall have 20 days leave to amend the Complaint from the date of this order.

DISCUSSION:

Demurrer of Revital Agi to Complaint

Defendant Revital Agi demurs to the Complaint in its entirety as uncertain, to the first cause of action for failure to allege the nature of the agreement at issue, and to the first and third causes of action for failure to state facts sufficient to constitute a cause of action.

Legal Standard

A demurrer 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 via proper judicial notice. (Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.) “A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed.” (SKF Farms v. Superior Court (1984) 153 Cal.App.3d 902, 905.) “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, supra, 147 Cal.App.4th at p. 747.) The ultimate facts alleged in the complaint must be deemed true, as well as all facts that may be implied or inferred from those expressly alleged. (Marshall v. Gibson, Dunn & Crutcher (1995) 37 Cal.App.4th 1397, 1403; see also Shields v. County of San Diego (1984) 155 Cal.App.3d 103, 133 [stating, “[o]n demurrer, pleadings are read liberally and allegations contained therein are assumed to be true”].) “This rule of liberal construction means that the reviewing court draws inferences favorable to the plaintiff, not the defendant.” (Perez v. Golden Empire Transit Dist. (2012) 209 Cal.App.4th 1228, 1238.)

Meet and Confer

Before filing a demurrer, the demurring party shall meet and confer in person or by telephone with the party who has filed the pleading subject to the demurrer and file a declaration detailing their meet and confer efforts. (Code Civ. Proc., § 430.41(a).) However, an insufficient meet and confer process is not grounds to overrule or sustain a demurrer. (Code Civ. Proc., § 430.41(a)(4).)

The declaration of Ryan Davis states that Defendant’s counsel sent a meet and confer letter on July 13, 2022, regarding the deficiencies in the Complaint, but Plaintiff never responded. (Declaration of Ryan Davis ISO Mot. ¶¶ 2-3, Exh. A.) The Court therefore finds that Defendant has met her statutory meet-and-confer obligations.

First Cause of Action: Breach of Partnership Agreement

Defendant contends that Plaintiff has not properly pled the elements of a breach of contract claim, and that Plaintiff has not properly pled the nature of the contract at issue.

To plead a cause of action for breach of a contract, a plaintiff must allege: (1) the existence of a valid contract; (2) that plaintiff performed, or his performance was excused; (3) defendant’s breach; and (4) resulting damages. (See, e.g, D’Arrigo Bros. of Cal v. United Farmworkers of Am. (2014) 224 Cal.App.4th 790, 800.) In lieu of setting out the terms of the contract verbatim, a plaintiff may allege the substance of the contract’s relevant terms. (See, e.g., Heritage Pac. Fin., LLC v. Monroy (2013) 215 Cal.App.4th 972, 994.) The complaint must plead whether the contract is written, oral, or implied by conduct. (Code Civ. Proc. § 430.10(g).)

Defendant contends that the Complaint does not set forth the elements of a breach of contract because it does not allege the relevant terms of any contract, and that the Complaint does not state whether the contract is written, oral, or implied by conduct. The Complaint alleges that the parties, including Does 1-5, entered into oral agreements with Plaintiff reflecting their partnership and joint ownership, which were memorialized in writing. (Complaint ¶ 83.) Defendant Agi substituted into this action in place of Doe 4 and, thus, is included in this broad allegation. The Complaint also asserts that the parties developed a course of dealing regarding the allocation of responsibilities and profits. (Complaint ¶ 85-86.) The Complaint does not set forth the terms of any oral agreement, nor does it allege that Plaintiff either performed all his obligations or was excused from doing so. Construing the Complaint in the light most favorable to Plaintiff, as required on a demurrer, the Complaint sets forth two sets of agreements: a set of oral agreements alleged in paragraph 83, and a set of agreements implied by conduct in paragraphs 85 and 86. This is sufficient to satisfy the requirements of section 430.10(g). The Complaint can also plausibly be read to state relevant terms of the apparent agreement implied by conduct in paragraphs 85 and 86, although not with respect to the oral agreement. Even under this construction, however, there is no allegation that Plaintiff either performed or was excused from performing. The Court therefore finds that Plaintiff has not stated facts sufficient to constitute a cause of action for breach of contract with respect to this Defendant.

Third Cause of Action for Fraud

Defendant also contends that Plaintiff has failed to state facts sufficient to constitute a cause of action for fraud.

“The elements of fraud that will lead to a tort action are: (a) misrepresentation; (b) knowledge of falsity; (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage. (Engalla v. Permanente Medical Group, Inc. (1997) 15 Cal.4th 951, 974.) Every element of the cause of action for fraud must be alleged in the proper manner and the facts constituting the fraud must be alleged with sufficient specificity to allow defendant[s] to understand fully the nature of the charge made. (Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 73.) “This particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Ibid.) “[G]eneral and conclusory allegations do not suffice.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)

Defendant contends that the allegations are not sufficiently specific to sustain a fraud claim. Specifically, Defendant contends that the central allegation that Defendants falsely promised Plaintiff a 50% profit-sharing interest in all business is insufficient because it does not state the misrepresentations with specificity. The relevant portion of the complaint states that “[i]n operating under a Joint Venture/Partnership, Defendant BURG, Does 1-5 promised Plaintiff a 50% profit sharing interest in all business and, in so doing, documented through numerous transactions and tax reporting that Plaintiff was a 50/50 partner and co-owner of the entire company.” (Complaint ¶ 117.) The Complaint offers no specificity as to when this representation was made except that it was made after 2011. (Complaint ¶ 115.) The Complaint does not state where these representations were made, to whom they were made, or how, except that they were made “by operating under a Joint Venture/Partnership.” In the Court’s view, these allegations are not sufficiently specific to sustain a cause of action for fraud. Further specificity is required if Plaintiff is to maintain this claim.

Uncertainty

Defendant also demurs to the Complaint in its entirety as uncertain.

"A demurrer for uncertainty is strictly construed, even where a complaint is in some respects uncertain, because ambiguities can be clarified under modern discovery procedures." (Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 616.) "A demurrer for uncertainty will be sustained only where the complaint is so bad that defendant cannot reasonably respond--i.e., he or she cannot reasonably determine what issues must be admitted or denied, or what counts or claims are directed against him or her." (Weil & Brown, Civil Procedure Before Trial (The Rutter Group) § 7:85 (emphasis in original).) "The objection of uncertainty does not go to the failure to allege sufficient facts." (Brea v. McGlashan (1934) 3 Cal.App.2d 454, 459.)

Defendant contends that the Complaint is uncertain because it inconsistently alleges that Defendant, as Doe 4, is both an individual and a corporate entity, and alleges that Defendant Revital, as a named third party, entered into agreements with the then-Doe 4 Defendant. (See, e.g, Complaint ¶ 60.) The Court is not persuaded that the Complaint is uncertain. The fact that certain allegations in the Complaint are impossible or incorrect on their face is not sufficient to sustain a demurrer for uncertainty. Such defects only go to whether the Complaint states facts sufficient to constitute a cause of action.

Leave to Amend

When a demurrer is sustained, the Court determines whether there is a reasonable possibility that the defect can be cured by amendment. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318). When a plaintiff “has pleaded the general set of facts upon which his cause of action is based,” the court should give the plaintiff an opportunity to amend his complaint, since plaintiff should not “be deprived of his right to maintain his action on the ground that his pleadings were defective for lack of particulars.” (Reed v. Norman (1957) 152 Cal.App.2d 892, 900.) Accordingly, California law imposes the burden on the plaintiffs to demonstrate the manner in which they can amend their pleadings to state their claims against a defendant. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.) “Denial of leave to amend constitutes an abuse of discretion unless the complaint shows on its face it is incapable of amendment. [Citation.] Liberality in permitting amendment is the rule, if a fair opportunity to correct any defect has not been given." (Angie M. v. Superior Court (1995) 37 Cal.App.4th 1217, 1227.)

Here, Plaintiff has not responded to the Demurrer, and thus has not demonstrated how the pleadings could be amended to cure these defects. However, in light of the nature of the defects in the Complaint, the Court will exercise its discretion to grant leave to amend.

Conclusion

Accordingly, Defendant Agi’s Demurrer is SUSTAINED with respect to the first and third causes of action with leave to amend, and otherwise OVERRULED.

Revital Agi’s Motion to Strike

Defendant Agi also moves to strike portions of the Complaint as irrelevant.

Meet and Confer

Before filing a motion to strike, the moving party shall meet and confer in person or by telephone with the party who has filed the pleading subject to the motion to strike and file a declaration detailing their meet and confer efforts. (Code Civ. Proc., § 435.5(a).) However, an insufficient meet and confer process is not grounds to grant or deny a motion to strike. (Code Civ. Proc., § 435.5(a)(4).)

For the reasons stated above in connection with the Demurrer, the Court finds that Defendant has complied with the statutory meet and confer requirements.

Legal Standard

The court may, upon a motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading. Code Civ. Proc., § 436(a). The court may also strike all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court. Id., § 436(b). The grounds for a motion to strike are that the pleading has irrelevant, false or improper matter, or has not been drawn or filed in conformity with laws. Id.§ 436. The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. Id.§ 437. “When the defect which justifies striking a complaint is capable of cure, the court should allow leave to amend.” Vaccaro v. Kaiman (1998) 63 Cal.App.4th 761, 768. A motion to strike can be used where the complaint or other pleading has not been drawn or filed in conformity with applicable rules or court orders. Code Civ. Proc., § 436(b). This provision is for "the striking of a pleading due to improprieties in its form or in the procedures pursuant to which it was filed." Ferraro v. Camarlinghi (2008) 161 Cal.App.4th 509, 528 (emphasis in original).

Analysis

Defendant moves to strike Plaintiff’s prayer for money damages in connection with the fourth cause of action for unfair competition, and to strike the request for attorney’s fees and costs.

Money damages are not available under the Unfair Competition Law. (Korea Supply Co. v. Lockheed Martin Corp., (2003) 29 Cal.4th 1134, 1144.) Further, attorney’s fees are not recoverable as costs unless authorized by statute or agreement. (Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 124, 127.) Here, Plaintiff requests money damages in connection with his claim for unfair business practices. (Complaint at 33:18-20.) Plaintiff also seeks attorney’s fees without identifying a basis for the request either by statute or pursuant to an agreement. (Complaint at 34:14.) The Court agrees with Defendant that these requests are improper as framed and should be stricken.

Conclusion

Defendant Agi’s Motion to Strike is GRANTED.

Demurrer of Eydan Berger to Complaint

Defendant Eydan Berger, substituted in as Doe 5, demurs to the Complaint for the same reasons as Defendant Agi, above.

Meet and Confer

The declaration of Ryan Davis states that Defendant’s counsel sent a meet and confer letter on August 1, 2022, regarding the deficiencies in the Complaint, but Plaintiff never responded. (Declaration of Ryan Davis ISO Mot. ¶¶ 2-3, Exh. A.) The Court therefore finds that Defendant has met the statutory meet-and-confer obligations.

Analysis

Defendant Berger demurs to the Complaint on the same basis as Defendant Agi. As the allegations in the Complaint are identical with respect to Doe 5 as to Doe 4, the Court finds that the Complaint does not state facts sufficient to sustain a cause of action with respect to the first and third causes of action, for the reasons explained above.

Conclusion

Accordingly, for the foregoing reasons, Defendant Berger’s Demurrer is SUSTAINED with respect to the first and third causes of action with leave to amend, and otherwise OVERRULED.

Eydan Berger’s Motion to Strike

Defendant Berger also moves to strike portions of the Complaint as irrelevant. Defendant Berger seeks to strike the same portions of the Complaint as Defendant Agi, on the same basis. Therefore, for the foregoing reasons, Defendant’s Motion to Strike is GRANTED.

CONCLUSION:

For the reasons explained above, Defendants’ Demurrers to the Complaint are SUSTAINED with leave to amend as to the first and third causes of action with respect to these Defendants and otherwise OVERRULED.

Plaintiff shall have 20 days leave to amend the Complaint from the date of this order.

Defendants Motions to Strike are GRANTED. Lines 33:18-20 and 34:14 of the Complaint are ordered stricken.

Moving Parties to give notice.

IT IS SO ORDERED.

Dated: December 5, 2022 ___________________________________

Theresa M. Traber

Judge of the Superior Court

Any party may submit on the tentative ruling by contacting the courtroom via email at Smcdept47@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.