Judge: Robert S. Draper, Case: 22STCV03370, Date: 2022-08-10 Tentative Ruling

Case Number: 22STCV03370    Hearing Date: August 10, 2022    Dept: 78

Superior Court of California 

County of Los Angeles 

Department 78 

Defendants Holt Avenue Housing Partners, LP and Holt Avenue Development Co., LLC’s Demurrer to the Complaint is SUSTAINED as to the Sixth and Tenth Causes of Action only. Plaintiff is granted twenty days leave to amend.

Defendants Holt Avenue Housing Partners, LP and Holt Avenue Development Co., LLC’s Demurrer to the Complaint is OVERRULED as to all other causes of action.

Defendant Holt Avenue Housing Partners, LP and Holt Avenue Development Co., LLC’s Motion to Strike Portions of Plaintiff’s Complaint is DENIED.

FACTUAL BACKGROUND   

This is an action for uninhabitable conditions in a residential property. The Complaint alleges as follows.

Plaintiff Kandee Gilbert Lewis (“Plaintiff”) lives in a residential unit (the “Subject Property”) managed or maintained by Defendants Holt Avenue Housing Partners, LLC, Holt Avenue Development Co., LLC, and Shield of Faith Economic Development Corporation (together “Defendants”). (Compl. ¶¶ 1-2.) Beginning in February 2020, Plaintiff became aware of toxic mold in the Subject Property. (Compl. ¶ 7.) Since then, Plaintiff has repeatedly informed Defendants of the uninhabitable conditions in the Subject Property. (Compl. ¶ 8.) Defendants not only failed to remedy the issues, but actively worked to conceal the existence of the dangerous conditions. (Compl. ¶ 9.) As a result, Plaintiff has suffered numerous health conditions. (Compl. ¶¶ 12(a-i).)

PROCEDURAL HISTORY 

On January 26, 2022, Plaintiff filed the Complaint asserting ten causes of action:

1.    Breach of Warranty of Habitability (Civil Code § 1941.1);

2.    Breach of Warranty of Habitability (Health & Safety Code § 17290.3)

3.    Breach of Warranty of Habitability (Civil Code § 1942.4);

4.    Negligence – Premises Liability;

5.    Nuisance;

6.    Intentional Infliction of Emotional Distress;

7.    Breach of Contract;

8.    Breach of Covenant of Quiet Enjoyment;

9.    Fraud/Deceit/Intentional Misrepresentation of Fact; and

10. Housing Discrimination in Violation of Government Code § 12921.  

On June 13, 2022, Defendants Holt Avenue Housing Partners, L.P. and Holt Avenue Development Co., LLC (together “Holt”) filed the instant Demurrer.

On June 15, 2022, Holt filed the instant Motion to Strike.

On July 28, 2022, Plaintiff filed an Opposition.

On August 3, 2022, Holt filed a Reply.

DISCUSSION 

                         I.     REQUEST FOR JUDICIAL NOTICE  

In ruling upon demurrers, courts may consider matters that are proper for judicial notice.  (ABF Capital Corp. v. Berglass (2005) 130 Cal.App.4th 825, 834.)  

The court may take judicial notice of “official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States,” “[r]ecords of (1) any court of this state or (2) any court of record of the United States or of any state of the United States,” and “[f]acts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code § 452, subds. (c), (d), and (h).)  

Evidence Code Section 452 provides that judicial notice may be taken for facts and propositions that are “not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Cal. Evid. Code § 452(h).) Further, “a court may take judicial notice of [recorded documents and] the fact of a document's recordation, the date the document was recorded and executed, the parties to the transaction reflected in a recorded document, and the document's legally operative language, assuming there is no genuine dispute regarding the document's authenticity. From this, the court may deduce and rely upon the legal effect of the recorded document, when that effect is clear from its face.” (Scott v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 743, 745-755.)  

Taking judicial notice of a document is not the same as accepting the truth of its contents or accepting a particular interpretation of its meaning. (Fremont Indem. Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 113-14 (citations and internal quotations omitted).) In addition, judges “consider matters shown in exhibits attached to the complaint and incorporated by reference.”  (Performance Plastering v. Richmond American Homes of California, Inc. (2007) 153 Cal.App.4th 659, 665.)  However, “[w]hen judicial notice is taken of a document . . . the truthfulness and proper interpretation of the document are disputable.” (Aquila, Inc. v. Sup. Ct. (2007) 148 Cal.App.4th 556, 569 (quoting StorMedia Inc. v. Sup. Ct. (1999) 20 Cal.4th 449, 457 n. 9).) 

The party requesting judicial notice must (a) give each adverse party sufficient notice of the request to enable the adverse party to prepare to meet the request and (b) provide the court with sufficient information to enable it to take judicial notice of the matter. (Cal. Evid. Code § 453.) 

Holt requests judicial notice of the following:

1.    Unlawful Detainer stipulated judgment executed and filed on 2/17/21 in Los Angeles Superior Court Case No. 20WCUD00714 (Ex. A.)

2.    Third-party Envirocheck Official Mold Report dated April 7, 2021. (Ex. B.)

3.    Lease agreement for the premised signed by Plaintiff dated 11/6/19 and upon which Plaintiff is relying for her breach of contract and attorney’s fees claims. (Ex. C.)

Holt’s Requests for Judicial Notice numbers 1 and 3 are GRANTED.

Holt’s Request for Judicial Notice number 2 is DENIED.

                       II.          DEMURRER

Holt Demurs to all causes of action in the Complaint pursuant to California Code of Civil Procedure section 430.10(e).

A demurrer should be sustained only where the defects appear on the face of the pleading or are judicially noticed. (Code Civ. Pro., §§ 430.30, et seq.) As is relevant here, a court should sustain a demurrer if a complaint does not allege facts that are legally sufficient to constitute a cause of action. (See id. § 430.10, subd. (e).) As the Supreme Court held in Blank v. Kirwan (1985) Cal.3d 311: “We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. . . . Further, we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context.” (Id. at p. 318; see also Hahn. v. Mirda (2007) 147 Cal.App.4th 740, 747 [“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. [Citation.]”)  

“In determining whether the complaint is sufficient as against the demurrer … if on consideration of all the facts stated it appears the plaintiff is entitled to any relief at the hands of the court against the defendants the complaint will be held good although the facts may not be clearly stated.”  (Gressley v. Williams (1961) 193 Cal.App.2d 636, 639.) 

A demurrer should not be sustained without leave to amend if the complaint, liberally construed, can state a cause of action under any theory or if there is a reasonable possibility the defect can be cured by amendment. (Schifando v. City of Los Angeles, supra, 31 Cal.4th at p. 1081.) The demurrer also may be sustained without leave to amend where the nature of the defects and previous unsuccessful attempts to plead render it probable plaintiff cannot state a cause of action. (Krawitz v. Rusch (1989) 209 Cal.App.3d 957, 967.) 

A.   Res Judicata

First, Holt argues that Plaintiff’s breach of contract, breach of quiet enjoyment, breach of habitability, negligence and nuisance causes of action are precluded by the doctrine of res judicata.

“The doctrine of res judicata gives certain conclusive effect to a former judgment in subsequent litigation involving the same controversy.” (People v. Barragan (2001) 32 Cal. 4th 236, 252-253.) The primary aspect of res judicata is claim preclusion, which bars a second suit between the same parties on the same cause of action. (Boeken v. Philip Morris USA, Inc. (2010) 48 Cal.4th 788, 797.) The secondary aspect of res judicata is issue preclusion, which acts “as an estoppel or conclusive adjudication as to such issues in the second action as were actually litigated and determined in the first action.” (Ibid.) 

Here, Holt argues that all controversies regarding the habitability of the Subject Property were adjudicated in the Unlawful Detainer action. Accordingly, Holt argues, any claims arising from allegations occurring between Plaintiff’s initial tenancy in 2019 and the termination of the jurisdiction of the Unlawful Detainer Court in August 2021, are precluded by issue preclusion. Holt contends that the stipulated judgment (the “Stipulated Judgment”) reached in the Unlawful Detainer action represents a final judgment on the issues raised in the Complaint.

The Stipulated Judgment states that “Defendant agrees that any future communication with management staff and employees” regarding issues of habitability “shall be via email only.” (RFJN Ex. A ¶ 5.) Additionally, the Stipulated Judgement states that it will “remain enforceable for six (6) months after it has been executed by the parties. (Id., ¶ 1.) Holt interprets these provisions to mean that Plaintiff raised the issue of habitability in the UD action, and that as Plaintiff did not re-open the UD case for habitability issues in the subsequent six months, those claims are precluded here.

To support this argument, Plaintiff relies primarily on Needelman v. DeWolf Realty Co., Inc. (2015) 239 Cal.App.4^th 750. In Needleman, plaintiff sued his lessor landlord for damage to personal property that plaintiff had left in his rental unit after he was evicted. The eviction was carried out pursuant to a stipulated judgment which explicitly stated that plaintiff “waived any claims he may have, which [the lessors] assert do not exist, to bring an attempted wrongful eviction against [the lessors] or any action in any way arising out of or concerned with his tenancy. . .” (Needelman at p. 754.) Additionally, the stipulation stated that plaintiff “agrees that any of his personal property remaining in the unit after he vacates or is evicted therefrom shall be considered abandoned property, and [the lessors] shall be entitled to dispose of it without any notice to [Needelman] or his attorney.” (Ibid.)

The Needelman Court, in affirming the dismissal of plaintiff’s action via demurrer, held that plaintiff’s claims were precluded as the “settlement agreement specifically provided that Needelman waived ‘any claims he may have. . . arising out of or concerned with his tenancy.’” (Id. at 757.) Additionally, the Court noted that the issue of personal property remaining in the unit after eviction was specifically and dispositively addressed in the settlement agreement. (Ibid.)

Here, there is no such explicit waiver of Plaintiff’s right to bring suit, nor any unambiguous indication that the issue of habitability was finally adjudicated in the UD action.

While Holt argues that the provision allowing the UD Court to maintain jurisdiction over the case for six months following the stipulated judgment constitutes a waiver of habitability claims, there is no clear language that this was the parties’ intent, as in Needelman. As such, it would be improper for the Court to determine at the pleading stage, as a matter of law, that res judicata applies.

B.   Sixth Cause of Action – Intentional Infliction of Emotional Distress

Next, Holt argues that the Complaint fails to state a viable claim for Intentional Infliction of Emotional Distress (“IIED”).

The elements of an intentional infliction of emotional distress cause of action are: (1) extreme and outrageous conduct by the defendant; (2) intention to cause or reckless disregard of the probability of causing emotional distress; (3) severe emotional suffering; and (4) actual and proximate causation of the emotional distress. (See Moncada v. West Coast Quartz Corp. (2013) 221 Cal.App.4th 768, 780; Wilson v. Hynek (2012) 207 Cal.App.4th 999, 1009.) To satisfy the element of extreme and outrageous conduct, defendant’s conduct “‘must be so extreme as to exceed all bounds of that usually tolerated in a civilized society.’” (Moncada, supra, 221 Cal.App.4th at 780 (quoting Trerice v. Blue Cross of California (1989) 209 Cal.App.3d 878, 883).)  

“Behavior may be considered outrageous if a defendant (1) abuses a relation or position which gives him power to damage the plaintiff’s interest; (2) knows the plaintiff is susceptible to injuries through mental distress; or (3) acts intentionally or unreasonably with the recognition that the acts are likely to result in illness through mental distress.” (McDaniel v. Gile (1991) 230 Cal.App.3d 363, 372.) 

Here, Holt argues that the only facts Plaintiff alleges to support her claim for IIED pertain to Defendants’ failure or refusal to repair the property, and that this alone cannot constitute extreme and outrageous conduct as required to successfully state a claim. Additionally, Holt argues that the allegations demonstrating Plaintiff’s emotional distress are boilerplate.

In response, Plaintiff argues that the Complaint, when read as a whole, alleges extreme and outrageous conduct. Plaintiff highlights Paragraph 8, which states:

Between February, 2020 and the present, Plaintiffs have repeatedly notified Defendants of the defects in the subject premises with toxic mold and other uninhabitable conditions. In spite of repeated and persistent notice to Defendants, Defendants have failed and refused to remedy the situation and cure all defects in the premises.

While this certainly demonstrates callous and unreasonable behavior, “[i]naction, absent an intent to injure, is insufficient to constitute extreme and outrageous behavior for intentional infliction of emotional distress liability.” (Davidson v. City of Westminster (1982) 32 Cal.3d 197, 210.) 

Here, Plaintiff has alleged gross mismanagement and an abject failure to properly maintain the Subject Property. However, without some indication of an intent to injure, Defendants’ failure to properly maintain the Subject Property cannot constitute a cause of action for IIED.

Additionally, the Court finds that the only allegation regarding emotional distress; that Plaintiff “has endured many sleepless nights and much emotional and mental distress, coupled with other physical conditions associated with severe and emotional distress” (Compl. ¶ 133); is too conclusory to show severe emotional distress.

Accordingly, Holt’s Demurrer to the Sixth Cause of Action for Intentional Infliction of Emotional Distress is SUSTAINED. Plaintiff is granted twenty days leave to amend.

C.  Ninth Cause of Action – Fraud/Deceit/Intentional Misrepresentation of Fact

Next, Holt demurs to the Ninth Cause of Action for Fraud/Deceit/Intentional Misrepresentation of fact.

The elements of fraud are: “(a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.” (Charnay v. Cobert (2006) 145 Cal.App.4th 170, 184.) In California, fraud, including negligent misrepresentation, must be pled with specificity. (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184.) “The particularity demands that a plaintiff plead facts which show how, when, where, to whom, and by what means the representations were tendered.” (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1469.)  “[I]n the case of a corporate defendant, the plaintiff must allege the names of the persons who made the representations, their authority to speak on behalf of the corporation, to whom they spoke, what they said or wrote, and when the representation was made. (West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 793.) 

Here, Holt argues that the Complaint fails to allege with particularity facts constituting fraudulent concealment.

The Complaint alleges that “[o]n or about November 6, 2019, Defendants’ manager and authorized agent defendant Rachel Sproul. . .concealed from Plaintiff that defendants were aware from complaints from other tenants that the subject property was completely contaminated with toxic mold and/or fungi. . .” (Compl. ¶ 152(a).) The Complaint also alleges that Sproul knew her representations were false (Compl. ¶ 154), that the misrepresentations “were made in a deliberate effort to deceive and defraud Plaintiff and to induce her to act in reliance on these misrepresentations” (Compl. ¶ 156), and that as a result, “Plaintiff was forced to expend additional time and effort in an attempt to recover money owed from defendants.” (Compl. ¶ 159.)

Together, these allegations state, with specificity, a cause of action for fraud.

Additionally, Holt argues that as there was no mold found in the subject property, Defendants did not deceive Plaintiff. However, as there is no judicially notable material demonstrating the lack of mold, Holt’s argument is unavailing.

Accordingly, Holt’s Demurrer to the Ninth Cause of Action is OVERRULED.

D.  Tenth Cause of Action – Housing Discrimination in Violation of Government Code § 1291 et seq.

Finally, Holt demurs to Plaintiff’s Tenth Cause of Action for Housing Discrimination Violation of Government Code § 12921, the Fair Employment and Housing Act.

Section 12921 states:

The opportunity to seek, obtain, and hold housing without discrimination because of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, genetic information, or any other basis prohibited by Section 51 of the Civil Code is hereby recognized as and declared to be a civil right.

Here, Holt argues that the only allegation in the Complaint proving that Defendants prevented Plaintiff from seeking, obtaining, or holding housing is that Defendants refused to renew Plaintiff’s lease in November 2019 and demanded that she vacated the property based on her age, race, sex, and physical abilities. Holt argues this is factually inaccurate, as the bulk of events described in the Complaint occurred while Plaintiff was residing in the Subject Property after she was allegedly withheld housing.

In Opposition, Plaintiff argues, first, that Defendants’ attempt to refuse to renew Plaintiff’s lease represents an attempt to prevent Plaintiff from holding housing. Plaintiff does not explain the discrepancy in the timeline.

The Complaint also alleges that Plaintiff was a member of a protected category due to her age, race, national origin, sex, and physical ability (Compl. ¶ 163), that Sproul, acting in her capacity as a Holt manager, made disparaging remarks regarding Plaintiff’s protected traits (Compl. ¶ 164), and that Defendants have refused to address the uninhabitable conditions of her unit due to her protected traits. (Compl. ¶ 166.)

However, as Holt notes in its reply, “[u]nlike common law causes of action, statutory claims must be pled with particularity. (Reply at p. 6; quoting Covenant Care, Inc. v. Superior Court (2004) 32 Cal.4^th 771, 790.)

Here, there are not specific facts indicating what type of harassment Plaintiff received, or facts demonstrating that the alleged attempt to prevent Plaintiff from holding housing was related to her protected traits.

Accordingly, Holt’s Demurrer to the Tenth Cause of Action is SUSTAINED. Plaintiff is granted twenty days leave to amend.

                     III.          Motion to Strike

Holt also moves to strike portions of the Complaint.

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.) 

Here, Holt moves to strike Plaintiff’s prayer for Punitive Damages and Attorney’s Fees.

A.   Punitive Damages

First, Holt moves to strike Plaintiff’s references to, and prayer for, punitive damages.

California Civil Code section 3294 authorizes the recovery of punitive damages in non-contract cases where “the defendant has been guilty of oppression, fraud, or malice . . . .” (Civ. Code § 3294(a).) “‘Malice’ means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.” (Id. § 3294(c)(1).) Punitive damages thus require more than the mere commission of a tort. (See Taylor v. Superior Court (1979) 24 Cal.3d 890, 894-95.) Specific facts must be pleaded in support of punitive damages. (See Hillard v. A.H. Robins Co. (1983) 148 Cal.App.3d 374, 391-92.)  

A plaintiff must establish the defendant was aware of the probable dangerous consequences of his conduct and that he willfully and deliberately failed to avoid those consequences to support an award of punitive damages based on conscious disregard of the safety of others. (Penner v. Falk (1984) 153 Cal.App.3d 858, 867.) Punitive damages thus require more than the mere commission of a tort. (See Taylor v. Superior Court (1979) 24 Cal.3d 890, 894-95.) Specific facts must be pleaded in support of punitive damages. (See Hillard v. A.H. Robins Co. (1983) 148 Cal.App.3d 374, 391-92.) 

“‘Oppression’ means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” (Id.,§ 3294(c)(2).) 

“‘Fraud’ means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.” (Id., § 3294(c)(3).) 

Here, Plaintiff’s Fraud Cause of Action survives demurrer, and supports a prayer for punitive damages.

Accordingly, Holt’s Motion to Strike Punitive Damages from the Complaint is DENIED.

B.   Attorney’s Fees

Next, Holt moves to strike the references to, and prayer for, attorney’s fees from the Complaint.

The parties primarily debate whether fees are recoverable under CCP section 1021.5, which allows for attorney fees to be awarded to a party that has prevailed in an action resulting in the enforcement of an important right affecting the public interest. (Vasquez v. State of California (2008) 45 Cal.4^th 243, 250-51.)

Holt argues that “actions that enforce a party’s own interests do not qualify for an award of fees under § 1021.5.” (Motion at p. 6; quoting Davis v. Farmers Insurance Exchange (2016) 245 Cal.App.4^th 1302, 1329.)

In response, Plaintiff contends that the complaint alleges “any judgment or settlement with the Defendants Holt Avenue confers a significant benefit upon a large class of persons [including] the homeowners and tenants who live in the area around the Subject Property.” (Compl. ¶ 84.) Additionally, Plaintiff notes that the Court is not required to strike a prayer for attorneys’ fees under section 1021.5 before the plaintiff has had a full opportunity to determine, through discovery, whether a basis for recovery exists. (Id; quoting Camenisch v. Superior Court (1996) 44 Cal.App.4^th 1689, 1699.)

As the Complaint alleges uninhabitable conditions in units beyond Plaintiff’s own (Compl. ¶ 4), it is feasible that the discovery process could reveal facts by which the instant action extends to the public benefit.

Accordingly, the Complaint properly asserts a prayer for attorney’s fees pursuant to section 1021.5, and Holt’s Motion to Strike is DENIED.

DATED: August 10, 2022 

____________________________

Hon. Robert S. Draper 

Judge of the Superior Court