Judge: Ronald F. Frank, Case: 22TRCV00913, Date: 2023-03-28 Tentative Ruling

Case Number: 22TRCV00913    Hearing Date: March 28, 2023    Dept: 8

Tentative Ruling¿ 

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HEARING DATE:                 March 28, 2023

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CASE NUMBER:                  22TRCV00913

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CASE NAME:                        Elbashier M. Kheir v. Bon Hoa Patrice, Wells Fargo, Eric Doe, and Does 1-10.

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MOVING PARTY:                Defendant Wells Fargo, N.A. (erroneously sued as Wells Fargo, a Financial Service Company).

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RESPONDING PARTY:       Plaintiff Elbashier M. Kheir

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TRIAL DATE:                        Not Set

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MOTION:¿                              (1) Defendant Wells Fargo Bank, N.A.’s Demurrer to Plaintiff’s First Amended Complaint

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Tentative Rulings:                  (1) SUSTAINED; without leave to amend.

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I. BACKGROUND¿¿ 

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A.    Factual¿¿ 

This action arises out of an alleged fraud committed against Elbashier Kheir (“Plaintiff”) who responded to an advertisement by Bon Hoa Patrice (“Defendant Patrice”) for a housing rental in April of 2022. (First Amended Complaint, hereinafter, “FAC”, ¶ 10). Defendant Patrice instructed Plaintiff to deposit two separate deposits of $2,000 to be made into two Wells Fargo bank accounts before Plaintiff could receive the keys to the home. (FAC, ¶ 11 & 13). After the second deposit, Plaintiff did not receive the keys. Plaintiff later visited a Wells Fargo (“Defendant Wells Fargo”) location in Gardena where the deposits were made and informed the branch that he had become victim to a scam. (FAC, ¶ 19). Plaintiff alleges that he was ignored. (Ibid.) Plaintiff then visited a separate branch of Defendant Wells Fargo where he was told that he would need to contact the San Francisco office to resolve this issue. (FAC, ¶ 20).  

B.     ¿ Procedural

On October 11, 2022, Plaintiff filed his initial complaint, followed by an FAC on January 23, 2023. The Court had sustained Wells Fargo’s Demurrer to several causes of action in the original complaint, but as to the negligence claim it granted Plaintiff leave to amend., resulting in the FAC.  The FAC alleges multiple causes of action, but only one as against Wells Fargo, cause of action # 6.  Defendant Wells Fargo filed the instant demurrer on February 17, 2023, demurring to the sixth cause of action for negligence. Plaintiff filed opposition papers on March 10, 2023. Reply papers were received by the Court on March 17, 2023.

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¿II. MEET AND CONFER

Legal Standard for Meet and Confer Requirement

“Before filing a 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.”  (CCP § 430.41(a); see also CCP § 435.5 (imposing similar requirements for a motion to strike).)

Analysis for Meet and Confer Requirement

On February 6, 2023, Defendant, the moving party here, spoke with Plaintiff over the phone and informed them of the intent to demur to the FAC. After the conversation, the parties were not able to reach an agreement. (Demurrer, Declaration of Compliance with Code of Civ. Proc. § 430.41, ¶ 2).

Conclusion for Meet and Confer Requirement

Despite no agreement, the efforts made here to meet and confer are sufficient. Accordingly, the meet and confer requirement pursuant to CCP § 430.41(a) has been met.

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¿III. ANALYSIS¿ 

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A.    Legal Standard ¿ 

“[A] demurrer tests the legal sufficiency of the allegations in a complaint.” (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.) A demurrer can be used only to challenge defects that appear on the face of the pleading under attack or from matters outside the pleading that are judicially noticeable. (See Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994 [in ruling on a demurrer, a court may not consider declarations, matters not subject to judicial notice, or documents not accepted for the truth of their contents].) For purposes of ruling on a demurrer, all facts pleaded in a complaint are assumed to be true, but the reviewing court does not assume the truth of conclusions of law. (Aubry v. Tri-City Hosp. Dist. (1992) 2 Cal.4th 962, 967.)

B.     Discussion 

¿Legal Standard for Negligence

In order to state a claim for negligence, Plaintiff must allege the elements of (1) “the existence of a legal duty of care,” (2) “breach of that duty,” and (3) “proximate cause resulting in an injury.” (McIntyre v. Colonies-Pacific, LLC (2014) 228 Cal.App.4th 664, 671.)

Analysis of Negligence

A bank’s “basic duty of care - to act with reasonable care in its transactions with its customers –

arises out of the bank’s contract with its customer. (Rodriguez v. Bank of the West (2008) 162

Cal.App.4th 454, 460.) California Commercial Code § 4104, subd. (a)(5) defines a bank’s

customer as “a person having an account with a bank or for whom the bank has agreed to collect

items.” A bank’s duty of care is owed to its depositors, i.e., customers with whom the bank has a account, not to strangers.  The law recognizes and exception, not applicable here, where the bank

has allowed a person to deposit a check payable into the customer’s account, notwithstanding

that the check was payable to someone else. (Sun ‘n Sand, Inc. v. United California Bank (1978)

21 Cal.3d 671.)

Defendant Wells Fargo’s primary contention is that Plaintiff cannot establish the first element of duty because Wells Fargo only owes a duty to its customers. (See Software Design & Application, Ltd. (1996) 49 Cal.App.4th 472, 479 [“…a bank does not owe a duty of care to a noncustomer”].   This Court agrees.

At no point in the FAC does Plaintiff show he was a Wells Fargo customer. In ¶ 54, on page 12 at line 12 Plaintiff admits he was and is not a “Defendant customer,” i.e., he did not have an account at Wells Fargo.  Plaintiff attempts to circumvent this issue by arguing that when he notified Wells Fargo of the fraud, Wells Fargo then had a duty to investigate (Opposition to Defendant’s Demurrer, hereinafter, “Opposition Papers”, 3:12-20). Plaintiff uses his opposition papers to assert that “Banks like any other institution has a duty to investigate fraud so as to protect service and interest of its customer, non-customer, or the general public.” (Opposition Papers, 3:12-13). However, this contention runs contrary to existing law, and Plaintiff provides no legal authority to support this contention. Moreover, there are no facts to show that Wells Fargo was informed of the fraud until well after Plaintiff himself authorized both deposits. (FAC, ¶ 11-15). Although unfortunate that Plaintiff fell victim to wrongdoing, the wrongdoing was not committed by Defendant Wells Fargo, and as a matter of law Wells Fargo owed no duty of care to Plaintiff on the fact presented in the original nor in the amended complaint.

Legal Standard for Leave to Amend

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 [court shall not “sustain a demurrer without leave to amend if there is any reasonable possibility that the defect can be cured by amendment”]; Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1037

Analysis and Conclusion for Leave to Amend

Because the only proper amendment here would have been for Plaintiff to have been a customer of Defendant Wells Fargo at the time of the alleged fraud, and Plaintiff has alleged in the FAC that he was not a Wells Fargo customer, the Court sees no possibility of successful amendment. Therefore, leaved to amend is denied.  

IV. CONCLUSION¿¿