Judge Salvatore Sirna, Case 22PSCV00902 2023-04-18 Tentative Ruling

Judge: Salvatore Sirna, Case: 22PSCV00902, Date: 2023-04-18 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: 22PSCV00902 Hearing Date: April 18, 2023 Dept: G

Defendant General Motors LLC’s Demurrer to Plaintiffs’ First Amended Complaint

Respondent: Plaintiffs Camilo Rivera Guzman and Christian Rivera Gomez

Defendant General Motors LLC’s Motion to Strike Punitive Damages from Plaintiffs’ First Amended Complaint

Respondent: Plaintiffs Camilo Rivera Guzman and Christian Rivera Gomez

TENTATIVE RULING

Defendant General Motors LLC’s Demurrer to Plaintiffs’ First Amended Complaint is OVERRULED.

Defendant General Motors LLC’s Motion to Strike Punitive Damages from Plaintiffs’ First Amended Complaint is DENIED.

BACKGROUND

This is a lemon law action. On July 5, 2020, Camilo Rivera Guzman and Christian Rivera Gomez (collectively, Plaintiffs) entered into a warranty contract with Defendant General Motors LLC by purchasing a 2020 Chevrolet Colorado. The warranty contract included a 3-year/36,000-mile express bumper to bumper warranty and a 5-year/60,000-milpowertrain warranty. Shortly after purchasing their vehicle, Plaintiffs began experiencing transmission defects.

On August 22, 2022, Plaintiffs filed a complaint against Defendant and Does 1-10, alleging (1) breach of express warranty in violation of the Song-Beverly Act, (2) breach of implied warranty in violation of the Song-Beverly Act, (3) violation of Section 1793.2, subdivision (b) of the Song-Beverly Act, and (4) fraud by concealment.

On December 28, 2022, Plaintiffs filed a First Amended Complaint (FAC) against same Defendants alleging the same causes of action.

On February 27, 2023, Defendant filed the present demurrer and motion to strike. Prior to filing, Defendant’s counsel attempted to meet and confer telephonically with Plaintiffs’ counsel but was unsuccessful. (Valencia Decl., ¶ 2.) On March 28, the court continued a hearing on the motions to give Defendant adequate time to meet and confer further. The same day, parties met and conferred over the telephone. (Valencia Supp. Decl., ¶ 7.)

A hearing on the demurrer and motion to strike is set for April 18, 2023, along with a case management conference.

ANALYSIS

Defendant demurs to Plaintiffs’ fourth cause of action (concealment). For the following reasons, the court OVERRULES Defendant’s demurrer.

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.)

Discussion

Defendant argues Plaintiffs’ fourth cause of action for fraud based on concealment fails because it is not pled with specificity and does not establish Defendant had a duty to disclose. The court disagrees.

“[T]he elements of a cause of action for fraud based on concealment are: ‘(1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.’” (Kaldenbach v. Mutual of Omaha Life Ins. Co. (2009) 178 Cal.App.4th 830, 850, quoting Roddenberry v. Roddenberry (1996) 44 Cal.App.4th 634, 665-666.)¿ 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.)

“A duty to disclose facts arises only when the parties are in a relationship that gives rise to the duty, such as ‘seller and buyer, employer and prospective employee, doctor and patient, or parties entering into any kind of contractual agreement.’” (Shin v. Kong (2000) 80 Cal.App.4th 498, 509, quoting Wilkins v. National Broadcasting Co. (1999) 71 Cal.App.4th 1066, 1082.) In this case, the FAC is silent on the issue of from whom Plaintiffs purchased their vehicle. (FAC, ¶ 4.) Pointing to this silence, Defendant argues Plaintiffs failed to establish a buyer-seller transaction that would create a duty of disclosure. However, while Defendant is correct with regards to the existence of a buyer-seller transaction, Plaintiffs also allege Defendant made express written warranties. (FAC, ¶ 4.) Express warranties are contractual in nature. (See Hauter v. Zogarts (1975) 14 Cal.3d 104, 117.) Because Defendant does not address this issue or point to any authority holding express warranties are insufficient to create a relationship between the parties, Defendant’s argument fails.

Defendant also contends Plaintiffs failed to plead fraud with specificity because (1) they did not identify the individual who concealed material facts, (2) establish that Defendant knew of the defects at time of Plaintiffs’ purchase, (3) point to any interactions with Defendant before or during the purchase of their vehicle, and (4) allege Defendant intended to induce reliance with respect to Plaintiffs’ specific vehicle. However, the specificity requirement is relaxed “when the allegations indicate that ‘the defendant must necessarily possess full information concerning the facts of the controversy’” (Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 158, quoting Bradley v. Hartford Acc. & Indem. Co. (1973) 30 Cal.App.3d 818, 825) or if “the facts lie more in the knowledge of the opposite party.” (Ibid, quoting Turner v. Milstein (1951) 103 Cal.App.2d 651, 658.)

In this case, Plaintiffs allege that Defendant knew of transmission defects before Plaintiffs purchased their car and as early as September 2014. (FAC, ¶ 25, 34, 40.) Plaintiffs allege Defendant has exclusive knowledge of these defects and intentionally concealed them. (FAC, ¶ 121, 125.) Lastly, Plaintiffs allege Defendant intentionally concealed the transmission defects in vehicles like Plaintiffs’ so they could be sold for the maximum price. (FAC, ¶ 129-130.) Thus, Plaintiffs have alleged sufficient facts to establish fraudulent concealment.

Accordingly, Defendant’s demurrer to Plaintiffs’ fourth cause of action is OVERRULED. Furthermore, because Defendant’s motion to strike Plaintiffs’ prayer for punitive damages is based on the grounds that Plaintiffs have not adequately alleged fraud, it is DENIED for the same reasons described above.

CONCLUSION

Based on the foregoing, Defendant’s demurrer to Plaintiffs’ FAC is OVERRULED. Furthermore, Defendant’s motion to strike Plaintiffs’ prayer for punitive damages is DENIED.

Defendant to answer Plaintiff’s complaint in ten (10) days.