Judge: Shirley K. Watkins, Case: 20VECV01216, Date: 2023-03-28 Tentative Ruling

If ALL parties submit on the tentative, then no appearance is necessary unless some other matter (i.e., Case Management Conference) is on calendar. It is not necessary to call the court to request oral argument. Oral argument is permitted on all tentative rulings.

Case Number: 20VECV01216    Hearing Date: March 28, 2023    Dept: T

[TENTATIVE] RULING: DEMURRER TO AND MOTION TO STRIKE FIRST AMENDED COMPLAINT[1]. THE DEMURRER IS SUSTAINED WITHOUT LEAVE  TO AMEND. THE MOTION TO STRIKE IS GRANTED IN FULL.  ANSWER DUE  IN 20 DAYS.

DEMURRER

THIRD COA (LOSS OF RENTAL PROPERTY): Sustained without leave to amend.  There is no cause of action for loss of rental property income.  If anything, this is an item of damages.

FOURTH COA: (PREMISES LIABILITY) Sustained without leave to amend.  The essence of a premises liability claim is that there was negligence or some other wrongful act on premises causing injury to plaintiff, not damages to property. See, CACI 1000, Premises Liability. Damages to property is an element of damages attached to a primary right.

FIFTH COA (UNJUST ENRICHMENT): Sustained without leave to amend.  “[U]njust enrichment is not a cause of action. Rather, it is a general principle underlying various doctrines and remedies, including quasi-contract.” (Jogani v.Superior Court (2008) 165 Cal.App.4th 901, 911 [81 Cal.Rptr.3d 503], internal citation omitted.)

SIXTH COA (QUANTUM MERUIT): Sustained without leave to amend. “Quantum meruit refers to the well-established principle that ‘the law implies a promise to pay for services performed under circumstances disclosing that they were not gratuitously rendered.’ [Citation.] To recover in quantum meruit, a party need not prove the existence of a contract [citations], but it must show the circumstances were such that ‘the services were rendered under some understanding or expectation of both parties that compensation therefor was to be made.’ ” [Citation.]’ ‘The underlying idea behind quantum meruit is the law’s distaste for unjust enrichment. If one has received a benefit which one may not justly retain, one should “restore the aggrieved party to his [or her] former position by return of the thing or its equivalent in money.” [Citation.]’ “ ‘The measure of recovery in quantum meruit is the reasonable value of the services rendered provided they were of direct benefit to the defendant.” [Citations.]’ In other words, quantum meruit is equitable payment for services already rendered.” (E. J. Franks Construction, Inc. v. Sahota (2014) 226 Cal.App.4th1123, 1127-1128 [172 Cal.Rptr.3d 778], original italics, internal citations omitted.) There is no claim for quantum meruit.  The facts alleged do not and cannot result in a quantum meruit claim.  Cee, CACI 371.

SEVENTH COA (CONVERSION):  Sustained without leave to amend.  The First Amended Complaint alleges that plaintiff made payments to defendant. “To prove a cause of action for conversion, the plaintiff must show the defendant acted intentionally to wrongfully dispose of the property of another.” (Duke v.Superior Court (2017) 18 Cal.App.5th 490, 508 [226 Cal.Rptr.3d 807].)  Here, plaintiff seeks to turn a breach of contract claim (i.e., overpayment of loan payments) into a tort claim.  The economic loss rule applies.  The claim is based on a contractual duty by plaintiff to make payments on a loan, and the claim that he overpaid and is owed a refund.  “Tort damages have been permitted in contract cases where a breach of duty directly causes physical injury [citation]; for breach of the covenant of good faith and fair dealing in insurance contracts [citation]; for wrongful discharge in violation of fundamental public policy [citation]; or where the contract was fraudulently induced. [Citation.]” (Erlich v. Menezes (1999) 21 Cal.4th 543, 551–552.)  This is not that type of case.

EIGHTH COA (MONEY HAD AND RECEIVED): Sustained without leave to amend.  Money Had and Received and Quantum Meruit are essentially the same and are generally known as "common counts."  The facts alleged do not and cannot result in a quantum meruit claim.  Cee, CACI 371.

NINTH COA (FRAUD): Sustained without leave to amend.  Plaintiff has attempted to allege fraud in the inducement.  The essence of the claim is that the defendant issued a loan secured by real property (a mortgage) but secretly intended all along to force the plaintiff into foreclosure.  The elements of fraud are (a) a misrepresentation (false representation, concealment, or nondisclosure); (b) scienter or knowledge of its falsity; (c) intent to induce reliance; (d) justifiable reliance; and (e) resulting damage. CACI 1900. Lazar v. Super. Ct, (1996) 12 Cal.4th 631, 638; Engalla v. Permanente Medical Group, Inc., (1997) 15 Cal.4th 951, 974; Perlas v. GMAC Mortg., LLC (2010) 187 Cal.App.4th 429, 434. Reviewing the allegations of the First Amended Complaint, there are substantial failures to allege sufficient facts to support a claim for fraud.  Again, this claim seems to be a reworking of the other tort claims in an attempt to plead around the economic loss rule.

TENTH COA (UNFAIR BUSINESS PRACTICES): Sustained without leave to amend. Plaintiff has failed to allege any conduct which is an unfair business practice and based on the facts of this case, cannot do so.  “Unfair” practices constitute “conduct that threatens an incipient violation of an antitrust law, or violates the policy or spirit of one of those laws because its effects are comparable to or the same as a violation of the law, or otherwise significantly threatens or harms competition.” Cal– Tech Communications, Inc. v. Marin Cellular Tel. Co. (1999) 20 Cal.4th 163, 187. When determining “whether the challenged conduct is unfair within the meaning of the unfair competition law…, courts may not apply purely subjective notions of fairness.” Id. at 184. The “fraudulent” prong under the UCL requires a showing of actual or potential deception to some members of the public, or harm to the public interest. Id. at 180; see also McKell v. Wash. Mut., Inc. (2006) 142 Cal.App.4th 1457.  Plaintiff also does not demonstrate proper standing under §17200, which requires showing that he suffered an injury-in-fact as a result of the unfair competition. Bus. & Prof. Code § 17204; Durrell v. Sharp Healthcare (2010) 183 Cal.App.4th, 1359. Plaintiff cannot do so. In the context of foreclosures, a plaintiff must show a causal link between the alleged economic injury, the loss or impending loss of property to foreclosure and the defendant’s alleged unfair, unlawful, or fraudulent business practices. Jenkins v. JP Morgan Chase Bank, N.A. (2013) 216 Cal.App.4th 497, 523, disapproved on other grounds in Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919 (Plaintiff unable to satisfy standing where she admitted default on loan). That is, Plaintiff’s default on the Loan is what triggered the foreclosure, not Defendants’ actions. Thus, there is no economic injury.

ELEVENTH COA (DECLARATORY RELIEF): Sustained without leave to amend.  Declaratory relief is not available for determination of past events. Declaratory relief “'operates prospectively, and not merely for the redress of past wrongs. It serves to set controversies at rest before they lead to repudiation of obligations, invasion of rights or commission of wrongs; in short, the remedy is to be used in the interests of preventive justice, to declare rights rather than execute them.' " Babb v. Superior Court (1971) 3 Cal. 3d 841, 848, quoting Travers v. Louden (1967) 254 Cal. App. 2d 926, 931.

Finally, the demurrer mentions that the court did not state whether the First Amended Complaint would relate back to the original filing.  That is correct.  However, the statute of limitations was not listed as the basis for the demurrer.  Therefore, the court does not address this issue.      

MOTION TO STRIKE

The court agrees with defendant's reasoning in support of its motion to strike references to punitive damages.  The motion is granted in full.

IT IS SO ORDERED, CLERK TO GIVE NOTICE.