Judge Salvatore Sirna, Case 20STCV23813 2023-03-06 Tentative Ruling

Judge: Salvatore Sirna, Case: 20STCV23813, Date: 2023-03-06 Tentative Ruling

The Court may change tentative rulings at any time. Therefore, counsel are advised to check this website periodically to determine whether any changes or updates have been made to the tentative ruling. Counsel may submit on the tentative rulings by calling the clerk in Department G at (909) 802-1104 prior to 8:30 a.m. the morning of the hearing.

Case Number: 20STCV23813 Hearing Date: March 6, 2023 Dept: G

Defendants Pac W. Dong; Clement Ziroli; Clement Ziroli, Jr.; Homeowners Equity Corporation; and Fin-West Group’s Demurrer to Plaintiffs’ Seventh Amended Complaint

Respondent: Plaintiffs Estate of Hugo Rivero, Jr. by and through its successors in interest, Hugo Rivero and Rubidelma Merida Damian; Hugo Rivero; Rubidelma Merida Damian; and Diana Rubi Gamboa

Defendants Masters Realty Services, Inc. and Cecilia Gonzalez Alvarez’s Demurrer to Plaintiffs’ Seventh Amended Complaint

Respondent: Plaintiffs Estate of Hugo Rivero, Jr. by and through its successors in interest, Hugo Rivero and Rubidelma Merida Damian; Hugo Rivero; Rubidelma Merida Damian; and Diana Rubi Gamboa

TENTATIVE RULING

Defendants Pac W. Dong; Clement Ziroli; Clement Ziroli, Jr.; Homeowners Equity Corporation; and Fin-West Group’s Demurrer to Plaintiffs’ Complaint is SUSTAINED IN PART without leave to amend and OVERRULED IN PART.

Defendants Masters Realty Services, Inc. and Cecilia Gonzalez Alvarez’s Demurrer to Plaintiffs’ Complaint is SUSTAINED IN PART without leave to amend and OVERRULED IN PART.

BACKGROUND

This is a wrongful death action arising from the tragic drowning of a child. In 2018, Hugo Rivero and Rubidelma Merida Damian (collectively, Buyers) purchased a house in Baldwin Park with a pool for their family, including Diana Rubi Gamboa (Gamboa) and Hugo Rivero, Jr. (Hugo Jr.), a 35-month-old toddler. Buyers were represented by JMA Legacy, Inc.; Luis Eduardo Fajardo; and Sergio Omar Becerra (collectively, Buyers’ Agents) as real estate agents. The property had been sold by Pac W. Dong; Homeowners Equity Corporation; Clement Ziroli; Clement Ziroli, Jr.; and Fin-West Group (collectively, Sellers), who were house flippers and represented by Masters Realty Services, Inc., and Cecilia Gonzalez Alvarez (collectively, Sellers’ Agents). Sellers hired Richard Bash and R B Real Estate Investments, Inc. (collectively, Bash Defendants), as well as S2W Construction, Inc. (S2W Construction), to remodel the Baldwin Park property.

On September 9, 2019, Hugo Jr. was able to gain access to the pool due to a single-feature barrier system and fell into the pool, ultimately suffering brain injuries that were fatal. Prior to purchasing the property, Buyers had informed Buyers’ Agents that they had children, including Hugo Jr. According to the Buyers, Hugo Jr. was able to access the pool undetected through a sliding glass door that provided direct pool access and bypassed the pool’s gate. The Buyers also allege the absence of any first layer of protection or backup drowning prevention safety features.

On June 24, 2020, the Estate of Hugo Rivero, Jr., the Buyers, and Gamboa (collectively, Plaintiffs) filed a complaint that has since been amended seven times. In the operative Seventh Amended Complaint (7AC) filed by Plaintiffs on January 3, 2023 against Sergio Fernandez, doing business as Bullseye Home Inspector; Buyers’ Agents; Sellers; Sellers’ Agents; S2W Construction; Bash Defendants; and Does 1-50, Plaintiffs alleged the following causes of action: (1) wrongful death: negligence; (2) negligence (negligent infliction of emotional distress – bystander); (3) wrongful death: breach of fiduciary duty and constructive fraud; (4) deceit; and (5) civil conspiracy (deceit).

On January 23, 2023, Sellers filed the present demurrer. Prior to filing on January 6, Sellers’ counsel met and conferred over email with Plaintiffs’ counsel and was unable to reach a resolution. (Lopez Decl., ¶ 3-4.) On February 16, the court continued the hearing on the demurrer and ordered Sellers’ counsel to attempt a code-compliant meet and confer. On the same day, Sellers’ counsel and Plaintiffs’ counsel briefly spoke over the telephone and agreed to talk later. (Lopez Suppl. Decl., ¶ 6.) However, on February 17 and February 22, Sellers’ counsel attempted to call Plaintiffs’ counsel but was unable to obtain a response. (Lopez Suppl. Decl., ¶ 7-8.)

On February 6, 2023, Sellers’ Agents filed the present demurrer. Prior to the filing, counsel for Sellers’ Agents sent a meet and confer letter to Plaintiffs’ counsel on January 25, requesting counsel’s availability for a phone call. (Grosch Decl., ¶ 4.) On January 27, counsel for Sellers’ Agents called Plaintiffs’ counsel but was unable to get a response. (Grosch Decl., ¶ 4.) On January 30 during a deposition, Plaintiffs’ counsel promised to call counsel for Sellers’ Agents back but never did. (Grosch Decl., ¶ 4.)

Hearings on the two present demurrers are set for March 6, 2023, along with a further status conference re: Status of Parties. A hearing on a demurrer by the Bash Defendants and case management conference are set for March 15.

REQUESTS FOR JUDICIAL NOTICE

Sellers’ request for judicial notice of prior filings in this action is GRANTED. Plaintiffs’ request for judicial notice of prior filings in this action is also GRANTED.

ANALYSIS

Sellers and Sellers’ Agents both demur to Plaintiffs’ first cause of action (wrongful death), second cause of action (negligent infliction of emotional distress), fourth cause of action (deceit), and fifth cause of action (civil conspiracy – deceit). For the following reasons, the court SUSTAINS the demurrers to Plaintiffs’ first and second causes of action without leave to amend and OVERRULES the demurrers to Plaintiffs’ fourth and fifth causes of action.

Legal Standard

A party may demur to a complaint on the grounds that it “does not state facts sufficient to constitute a cause of action.” (Code Civ. Proc., § 430.10, subd. (e).) A demurrer tests whether the complaint states a cause of action. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 747 (Hahn).) When considering demurrers, courts accept all well pleaded facts as true. (Fox v. JAMDAT Mobile, Inc. (2010) 185 Cal.App.4th 1068, 1078.) 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, at p. 747.)

Wrongful Death: Negligence (First Cause of Action)

Both Sellers and Sellers’ Agents argue Plaintiffs’ first cause of action for wrongful death (negligence) fails to plead sufficient facts to state a claim as Plaintiffs have not established Sellers and their agents owed a duty. The court agrees.

“The elements of a cause of action for wrongful death are a tort, such as negligence, and resulting death.” (Lopez v. City of Los Angeles (2011) 196 Cal.App.4th 675, 685.) The basic of elements of a negligence claim are (1) duty, (2) breach, (3) causation, and (3) damages. (Leslie G. v. Perry & Associates (1996) 43 Cal.App.4th 472, 480.) “[W]here the seller knows of facts materially affecting the value or desirability of the property which are known or accessible only to him and also knows that such facts are not known to, or within the reach of the diligent attention and observation of the buyer, the seller is under a duty to disclose them to the buyer. [Citations.] When the seller’s real estate agent or broker is also aware of such facts, he [or she] is under the same duty of disclosure.” (Holmes v. Summer (2010) 188 Cal.App.4th 1510, 1518-1519 [quotation marks and citations omitted].)

In this case, the defects that Plaintiffs allege were latent, not discoverable, and not within the diligent attention or observation of Buyers included (1) the lack of self-closing and self-latching doors adjacent to the pool, (2) the lack of alarm chimes, (3) the illegality of the wall-to-wall partial gate around the pool, (4) the lack of multiple drowning prevention safety measures, and (5) the fact that these defects were noncompliant with the Pool Safety Act. (7AC, ¶ 43.) However, although Plaintiffs allege these defects were not discoverable and within the diligent observation of the Buyers, the court finds this legal conclusion to be unsupported by the list of pled defects. (B & P Development Corp. v. City of Saratoga (1986) 185 Cal.App.3d 949, 953 [“In evaluating a demurrer, we assume the truth of all material facts properly pleaded in the complaint unless they are contradicted by facts judicially noticed [Citations] but no such credit is given to pleaded contentions or legal conclusions.”].)

In a similar case, the absence of a fence around a pool was deemed to be a patently obvious defect as a matter of law. (Mattingly v. Anthony Industries, Inc. (1980) 109 Cal.App.3d 506, 511-512.) In another case, design defects in stairs were held to be patent at the demurrer stage as a visual inspection and use of the stairs by the average consumer would have revealed the defects. (Delon Hampton & Associates, Chartered v. Superior Court (2014) 227 Cal.App.4th 250, 256.) Similarly here, the absence of self-latching or closing doors, gates that completely enclosed the pool, door chimes, and other pool safety features are open and obvious defects not outside the attention or diligent observations of a buyer.

In fact, Plaintiffs’ own pleadings suggest Buyers were well aware of the defects. When Buyers visited the property prior to purchase, they noticed the pool lacked a barrier system or gate and requested one be provided. (7AC, ¶ 22.) After Sellers accepted Buyers’ offer and before the close of escrow, Buyers again visited the property and after noting the pool still lacked a gate, sought assurances that a gate or barrier system would be installed that was in full compliance with safety standards. (7AC, ¶ 23.) On October 17, 2018, Buyers’ Agents communicated to Sellers’ Agents that Buyers wanted a new pool gate. (7AC, ¶ 24.) When Sellers’ Agents responded that Sellers could install an alarm chime for the door accessing the pool instead, Buyers’ Agents responded, stating “I relayed that information to my client, but it’s a concern for her since they have 2 small children. She was going to talk to her husband about it. When they give me a response I’ll let you know.” (7AC, ¶ 24.) Sellers’ Agents then responded, stating Sellers agreed to install a partial gate and Buyers’ Agents responded claiming Buyers would be happy. (7AC, ¶ 24.)

When Buyers visited the property again, Buyers noted the partial gate had been completed and were told by Buyers’ agent that the gate was compliant with safety standards. (7AC, ¶ 29-30.) Thus, Plaintiffs’ own pleadings establish that Buyers were aware of pool safety issues from the very beginning and that their agents tried to negotiate which safety barriers would be installed. As a result, the court finds that Sellers and Sellers’ Agents had no duty to disclose these defects. Thus, Plaintiffs’ cause of action for negligence against Sellers and Sellers’ Agents fails.

The court notes that it has allowed seven (7) amendments to the complaint, beyond the number permitted pursuant to Code of Civil Procedure, §430.41 (e)(1). Accordingly, the demurrers by Sellers and Sellers’ agents to Plaintiffs’ first cause of action is SUSTAINED without leave to amend.

Negligent Infliction of Emotional Distress (Second Cause of Action)

Sellers and Sellers’ Agents contend Plaintiffs’ second cause of action for negligent infliction of emotional distress (NIED) fails to plead sufficient facts to state a claim because Plaintiffs have failed to establish negligence. The court agrees.

Because Plaintiffs failed to establish a claim for wrongful death against Sellers and Seller’s Agents for lack of duty, Plaintiffs’ NIED claim also necessarily fails. Such a claim requires emotional distress caused by “observing the negligently inflicted injury of a third person.” (Thing v. La Chusa (1989) 48 Cal.3d 664, 667.)

Accordingly, Sellers and Sellers Agents’ demurrers to Plaintiffs’ second cause of action is SUSTAINED without leave to amend.

Deceit (Fourth Cause of Action)

Sellers and Sellers’ Agents maintain Plaintiffs’ fourth cause of action for deceit fails to plead sufficient facts to state a claim. The court disagrees.

“California law generally recognizes four forms of deceit: intentional misrepresentation, negligent misrepresentation, concealment, and failure to perform a promise.” (Finch Aerospace Corp. v. City of San Diego (2017) 8 Cal.App.5th 1248, 1252, citing Civ. Code, §§ 1572, 1710.) Here, Plaintiffs allege intentional misrepresentation and concealment of a material fact. (7AC, ¶ 84.)

“To establish a claim for deceit based on intentional misrepresentation, the plaintiff must prove seven¿essential elements: (1) the¿defendant¿represented¿to the¿plaintiff¿that an¿important¿fact¿was¿true; (2) that¿representation¿was¿false; (3) the¿defendant¿knew¿that the¿representation¿was¿false¿when the¿defendant¿made¿it, or the¿defendant¿made¿the¿representation¿recklessly¿and without¿regard¿for¿its¿truth; (4) the¿defendant¿intended¿that the¿plaintiff¿rely¿on the¿representation; (5) the plaintiff¿reasonably relied on the representation;¿(6) the plaintiff was harmed; and (7) the plaintiff's reliance on the defendant's representation was a substantial factor in causing that harm to the plaintiff.” (Manderville v. PCG&S Group, Inc. (2007) 146 Cal.App.4th 1486, 1498.) “A fraud claim based upon the suppression or concealment of a material fact must involve a defendant who had a legal duty to disclose the fact.” (Hoffman v. 162 North Wolfe LLC (2014) 228 Cal.App.4th 1178, 1186.) Furthermore, the facts constituting the alleged fraud must be alleged factually and specifically as to every element of fraud, as the policy of “liberal construction” of the pleadings will not ordinarily be invoked. (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)

In this case, Sellers and Sellers’ Agents claim Plaintiffs fail to plead specific facts establishing deceit. Plaintiffs repeatedly allege Sellers made misrepresentations that only cosmetic repairs had been performed (7AC, ¶ 16), that the property did not suffer from any defects (7AC, ¶ 16), that the pool and pool gate had no defects (7AC, ¶ 17), and that the pool complied with safety laws (7AC, ¶ 36). Plaintiffs also allege that Sellers’ Agents claimed the pool’s barrier system contained no defects. (7AC, ¶ 21.) However, these allegations all remain vaguely pled and lack the specificity required for fraud allegations as they do not identify the exact who, what, when, where, and how for each allegation.

Plaintiffs also allege Sellers and Sellers’ Agents concealed material facts by failing to disclose the pool’s lack of safety features. (7AC, ¶ 17, 32, 41-42, 78.) “A claim of fraud based on mere nondisclosure may arise when there is a confidential relationship, when the defendant has made a representation that is likely to mislead absent a disclosure, when there is active concealment of the undisclosed matter, or ‘when one party to a transaction has sole knowledge or access to material facts and knows that such facts are not known to or reasonably discoverable by the other party.’” (Alfaro v. Community Housing Improvement System & Planning Assn., Inc. (2009) 171 Cal.App.4th 1356, 1382, quoting Goodman v. Kennedy (1976) 18 Cal.3d 335, 347.)

Here, in response to Plaintiffs’ request for a new pool gate that complied with the law and regulations, Sellers’ Agents responded that “[t]he seller is willing to install a gate at the pool area, but only from wall to wall. I have attached the seller response and a picture with what kind of gate that will be installed (this is an old pic of the house of course, wanted to be clear as to what it will look like) Thank you!” (7AC, ¶ 78.) While Sellers and Sellers’ Agents did not affirmatively represent that their proposal met Plaintiffs’ request for a legally compliant pool gate, the court finds this allegation is sufficient to qualify as a representation likely to mislead absent disclosure. California courts recognize “[a] duty to disclose may also arise in the so-called ‘half truth’ context—that is, when a speaker makes a representation which, though not false, he knows will be misleading absent full disclosure of additional facts known to him which qualify the initial representation.” (San Diego Hospice v. County of San Diego (1995) 31 Cal.App.4th 1048, 1055, fn. 4.)

In Barder v. McClung (1949) 93 Cal.App.2d 692, the court held it was fraud when a seller failed to inform a buyer that modifications seller made to the property were illegal. (Id., at p. 696-697.) In Watt v. Patterson (1954) 125 Cal.App.2d 788, the court held a seller did not have a duty to inform the buyer of an applicable zoning ordinance where neither party was aware of the zoning ordinance. (Id., at p. 793-794 & fn. 1.) Conversely here, Plaintiffs specifically allege that Sellers knew that the proposed pool gate “was old, outdated, illegal, and ineffectual and, contrary to the Buyers’ written request, was not ‘according to law and regulations’”, and would require the installation of alarm chimes. (7AC, ¶ 40.) Thus, Plaintiffs have sufficiently alleged Sellers and Sellers’ Agents had a duty to disclose that their proposal did not meet pool safety standards.

In response, Sellers contend that Plaintiffs failed to establish the pool gate was illegal under the Pool Safety Act. According to Plaintiffs’ 7AC, “[w]hen an existing residential swimming pool is updated or remodeled, the swimming pool shall be equipped with at least two (2) of seven (7) drowning prevention safety features that are listed in subdivision (a) of Section 115922 of the Health and Safety Code (emphasis added).” (7AC, ¶ 3(c).) Later, Plaintiffs allege the defendants, including Sellers, “demolished, removed, altered, reinstalled, remodeled and/or furnished materials for numerous structural and barrier components and safety aspects of the Property, including the interior and exterior doors, bars, and gates, sliding glass doors leading directly to the Pool, the framing, plumbing, light fixtures, the Pool, the Pool gate, and the Pool’s structural and barrier components.” (7AC, ¶ 10.) While Sellers contend this allegation is unclear, and point to other allegations only referencing modifications to the pool barrier system and not the pool itself, the court declines to adopt Sellers’ narrow interpretation of the pleadings. Instead, the court finds this allegation mentions not only the barrier components and safety aspects, but also references framing, plumbing, and light fixtures.

Next, Sellers contend Plaintiffs failed to establish justifiable reliance. “Except in the rare case where the undisputed facts leave no room for a reasonable difference of opinion, the question of whether a plaintiff's reliance is reasonable is a question of fact.” (Alliance Mortgage Co. v Rothwell (1995) 10 Cal.4th 1226, 1239.) Here, Plaintiffs alleged their reliance was justified because Sellers and Sellers’ Agents held themselves out to be real estate professionals. (7AC, ¶ 32.) While, as previously noted, Buyers conducted multiple inspections of the property, “[a]n independent investigation or an examination of property does not preclude reliance on representations where the falsity of the statement is not apparent from an inspection, or the person making the representations has a superior knowledge, or the party relying thereon is not competent to judge the facts without expert assistance.” (Bagdasarian v. Gragnon (1948) 31 Cal.2d 744, 748.) Thus, even though Buyers conducted an inspection and were aware of the incomplete pool gate, the court finds that Plaintiffs sufficiently alleged justifiable reliance because (1) the gates were constructed in response to their request for compliant safety gates and (2) Sellers were alleged to be real estate professionals engaged in house-flipping.

Last, Sellers’ Agents contend Plaintiffs have failed to establish causation between the wrongful death of their child and the alleged fraud. “Ordinarily proximate cause is a question of fact which cannot be decided as a matter of law from the allegations of a complaint.” (See Weissich v. County of Marin (1990) 224 Cal.App.3d 1069, 1084.) Here, Plaintiffs allege that the failure to inform them of the lack of pool safety barriers led to their “false sense of security” and the loss of their minor child. (7AC, ¶ 82-83.) The court finds this sufficient.

Accordingly, the court finds Plaintiffs alleged sufficient facts to establish fraud by concealment as to Sellers and sellers’ Agents. Therefore, the demurrers by Sellers and Sellers’ Agents to Plaintiff’s fourth cause of action are OVERRULED.

Civil Conspiracy (Fifth Cause of Action)

Sellers and Sellers’ Agents argue Plaintiffs’ fifth cause of action for civil conspiracy fails to plead sufficient facts to state a claim. The court disagrees.

“Conspiracy is not a cause of action, but a legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasors a common plan or design in its perpetration.” (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510-511.) “The elements of a civil conspiracy are (1) the formation of a group of two or more persons who agreed to a common plan or design to commit a tortious act; (2) a wrongful act committed pursuant to the agreement; and (3) resulting damages.” (City of Industry v. City of Fillmore (2011) 198 Cal.App.4th 191, 212.)

In this case, Sellers and Sellers’ Agents suggest Plaintiffs cannot establish civil conspiracy due to the absence of tortious conduct. However, the court overruled the demurrers by Sellers and Sellers’ Agents to Plaintiff’s fourth cause of action for fraud. Therefore, this argument no longer holds merit.

Here, Plaintiffs allege that Sellers, Sellers’ Agents, and Buyers’ Agents had an agreement to deceive Buyers into believing the pool gate was installed in compliance with safety regulations. (7AC, ¶ 86.) As noted above, Plaintiffs have sufficiently alleged Sellers and Sellers’ Agents engaged in concealment. Finally, Plaintiffs established damages in the form of the wrongful death of their child. Thus, Plaintiffs have pled facts sufficient to establish the liability under civil conspiracy of Sellers and Sellers’ Agents’.

Accordingly, the demurrers by Sellers and Sellers’ Agents’ to Plaintiffs’ fifth cause of action are OVERRULED.

CONCLUSION

Based on the foregoing, the demurrers by Sellers and Sellers’ Agents to the first and second causes of action of Plaintiffs’ 7AC are SUSTAINED without leave to amend.

The demurrers by Sellers and Sellers’ Agents to the fourth and fifth causes of action of Plaintiffs’ 7AC are OVERRULED.

Sellers and Seller’s Agents to file their respective answers in twenty (20) days.