Judge: Shirley K. Watkins, Case: 22VECV00619, Date: 2022-09-13 Tentative Ruling

Case Number: 22VECV00619    Hearing Date: September 13, 2022    Dept: T

            [TENTATIVE] ORDER:  Defendant Arthur Page and Defendant Arthur Page Company LLC’s Demurrer to Cienega Spa, Inc and Rose’s Garden Bar LLC’s Complaint is OVERRULED as to the second, fifth and sixth causes of action and SUSTAINED WITH 20 DAYS LEAVE TO AMEND as to the third, fourth causes of action.

            Defendant Arthur Page and Defendant Arthur Page Company LLC’s Demurrer to the entirety of Rose’s Garden Bar LLC’s Complaint is OVERRULED.

Defendant Arthur Page and Defendant Arthur Page Company LLC’s Motion to Strike Portions of the Complaint is DENIED as to Complaint paragraphs 101-104, punitive damages under the second and fifth causes of action, and attorney’s fees; MOOT as to punitive damages under the third cause of action; GRANTED WITHOUT LEAVE TO AMEND as to punitive damages under the fourth cause of action.

Introduction

Defendant Arthur Page (Page) and Defendant Arthur Page Company LLC (APC) (collectively Defendants) demur to Plaintiff Cienega Spa, Inc. (CS) and Plaintiff Rose’s Garden Bar, LLC (RGB) (collectively Plaintiffs) Complaint.  Defendants demur to the second through sixth and eighth causes of action (COA.)  Defendants also demur to the entirety of RGB’s Complaint.  Defendants move to strike allegations in Complaint paragraphs 101-104; the requests for punitive damages and attorney’s fees.

            Discussion 

Second COA for Concealment:

Defendants argue that an architect’s licensure is public information and available online.  Defendants’ contention appears to be a defense on the merits rather than an argument to show a defect in the pleading.  Further, this argument is grounded on facts not within the four corners of the pleading or a judicially noticeable fact.  Because Defendants’ argument relies upon outside facts, it is improper to be the basis of a demurrer.  Defendants’ argument is unpersuasive. 

Defendants further assert that there are no facts showing that Defendants prevented Plaintiffs from discovering facts regarding non-licensure.  However, Defendants’ contention only addresses a single factor in the first pleading element of concealment fraud.  The first element of concealment fraud is listed in the disjunctive and can include: (1) Defendants’ intentional failure to disclose facts; or (2) Defendants’ disclosure of some but not all facts making the disclosure deceptive; or (3) Defendants’ intentional failure to disclose facts known only to Defendants and that Plaintiffs could not have discovered; (4) or Defendants’ preventing Plaintiffs from discovering facts.  (CACI 1901.)  Plaintiffs allege that Defendants represented himself to be an architect but failed disclose his lack of licensure.  (Compl. par. 13.)  This fact pleading is sufficient to support the second pleading factor of the first element of concealment fraud.  Defendants’ argument that they did not prevent Plaintiffs from discovery of the truth misses the relevant concealment fraud claim.  The argument is unpersuasive. 

            Defendants then argue, in a single sentence and in conclusory fashion, that Plaintiffs did not plead sufficient facts as to the other pleading element of concealment fraud.  (Demurrer pg. 4:23-25.)  It is not upon the Court “to seek out theories [a party] might have advanced, or to articulate for him that which … [a party] has left unspoken.'”  (Mesecher v. County of San Diego (1992) 9 Cal.App.4th 1677, 1686.)  Because Defendants’ contention is conclusory and does not apply legal authority to the facts pled in the Complaint, the single sentence argument is unsupported. 

            The demurrer to the second COA is OVERRULED.

Third and Fourth COAs for Intentional and Negligent Misrepresentation

            Defendants argue that there are insufficient facts to allege an actual misrepresentation.  Despite Defendants’ contention, Plaintiffs expressly alleges that Defendants misrepresented to them that he was an architect.  (Compl. pars. 13-15.)  Defendants’ argument ignores the express factual allegation made as to the alleged misrepresentation by only citing to Complaint paragraphs 61-77.  (Demurrer pg. 5:20-21.)  Further, Defendants’ arguments relying upon allegations related to plans/documents submitted to the City of Calabasas misses the actual allegations made to support these fraud-based claims.  Plaintiffs expressly allege that Co-Defendant Ronald Marshall’s stamp on the plans were fraudulently placed by Page and Plaintiffs allege that Marshall did not review any of the plans submitted to Calabasas.  (Compl. pars. 31-34.)  Defendants’ argument that Plaintiffs cannot allege that Page improperly submitted plans under his own name that bears another architect’s stamp number, again, misses the mark as to the actual misrepresentation made.  Plaintiffs are not alleging that Page used his own name on the plans.  Plaintiffs are alleging that Page used Marshall’s name without Marshall’s authorization or knowledge.  Defendants’ arguments are without support. 

Defendants argue that these two fraud-based claims lack specific fact pleading – the how, when, where, to whom and by what means the representations were made.  Plaintiffs allege that the misrepresentation was made on November 21, 2020 by Page and to CS’s staff.  (Compl. par. 13.)  These facts show the when and to whom the representations were made.  Plaintiffs’ allegations do not show where, how and by what means the representations were made.  On this pleading defect, the demurrer to the fraud-based claims are not sufficiently pled with specific facts.

Defendants then characterize the services that they provided as interior design service and argue that they did not provide any architectural services (i.e., plans/designs that consisted of structural elements of a building.)  Specifically as to the “interior design” argument, the argument is again using facts outside the four corners of the pleading and facts not judicially noticeable.  Plaintiffs expressly alleged that Defendants provided “architectural services” (Compl. pars. 33-35, 39.)  For demurrer purposes, this allegation is deemed true.  Defendants’ arguments are contradicted by the allegations of the Complaint.  As to Defendants’ argument in the Reply arguing that specific “architectural services” were not identified, again Defendants ignore the express allegations in the Complaint.  Plaintiffs expressly alleges that Defendants’ services included: “schematic design floorplan layouts,” “mechanical, electrical, and plumbing (commonly known as “MEP”) engineering drawings,” and “architectural drawings, structural engineering drawings, and MEP drawings.”  (Compl. par. 39a.-c.)  Defendants’ argument is unpersuasive.

For the above defect in specific fact pleading, the demurrer to the third and fourth COAs is SUSTAINED WITH LEAVE TO AMEND.

Fifth COA Breach of Fiduciary Duty

            Defendants argue that architects are not fiduciaries unless other facts give rise to establish the relationship.  Defendants contention lacks any supportive legal authority.  Plaintiffs, however, cite to case law showing that architects owe their clients a fiduciary duty of loyalty and good faith because architects are “trusted agents” of the owner.  (Palmer v. Brown (1954) 127 Cal.App.2d 44, 59.) Plaintiffs sufficiently provide authority to show that architects are fiduciaries to the owner of the property. 

Defendants argue that the pleading contains an inconsistency in the facts alleged.  Plaintiffs assert that Defendants are not architects under the second through fourth COAs and Defendants defrauded Plaintiffs in claiming that they were architects.  In the instant COA, Plaintiffs appear to allege that Defendants are architects and allege that Defendants owe a fiduciary duty under such capacity.  Either Defendants are or are not architects.  This is potentially an inconsistency.  However, the argument is too narrow in its assessment of the pleading.  Plaintiffs allege that Defendants “acted on Plaintiffs’ behalf in performing architectural services for the Project.”   (Compl. par. 79.)  The allegation shows that Plaintiffs are not alleging a fiduciary relationship based upon Defendants purported status as architects.  Plaintiffs are alleging a fiduciary relationship under a generalized principal-agent relationship because Defendants performed “architectural services.”  Because Plaintiffs maintain that Defendants are not licensed architects and that Defendants acted as Plaintiffs’ agents, there are sufficient facts to show a fiduciary relationship as between a principal and agent.

            The demurrer to the fifth COA is OVERRULED.

            It is noted that this analysis regarding principal/agent relationship creating a fiduciary duty is equally applicable to the second COA for concealment fraud’s first pleading element regarding fiduciary relationship.  The second COA sufficiently pleads a fiduciary relationship based upon the facts showing a principal/agent relationship between the parties.

Sixth COA Constructive Fraud

            Defendants argue a lack of facts showing a fiduciary relationship, however, as analyzed above, the contention is not persuasive.  It is noted that Defendants’ argument citing to Complaint paragraph 85 ignores the first sentence of the paragraph.  Plaintiffs allege that Page was “Plaintiffs’ trusted agents [sic].”  Despite Plaintiffs claiming Defendants “holding” themselves out as architects, there are sufficient facts, as analyzed above, to show a principal-agent relationship outside the bounds of client-architect. 

            The demurrer to the sixth COA is OVERRULED.

Eighth COA for Bus. & Prof. Code sec. 17200

            Defendants argue that Plaintiffs’ eighth COA for Bus. & Prof. Code sec. 17200 (UCL) violation insufficiently pleads the remedy for damages and injunctive relief.  However, the Court notes that disgorgement or injunctive relief are both proper remedies under UCL.  (Bus. & Prof. Code sec. 17204.)  Arguments as to improper remedies is not proper for a demurrer.  If any valid COA is pled, the pleading overcomes the demurrer.  (Venice Town Council, Inc. v. City of Los Angeles (1996) 47 Cal.App.4th 1547, 1561-1562.) 

            Defendants argue that the UCL claim is insufficiently pled as to the borrowed claim under Business & Professions Code sec. 5536.  (Compl. par. 100.)  Preliminarily, it is noted that the UCL COA is not solely based upon a Business & Professions Code sec. 5536 violation.  Plaintiffs allege four other statutory violations from which the UCL claim borrows.  (See Compl. pars. 101-104.)  Because Defendants argument does not address the entirety of the UCL COA, there is insufficient grounds to sustain the demurrer.  Even if the Court were to consider Defendants’ argument, the Court notes that Defendants’ arguments as to a required writing under Business and Professions Code section 5536 ignores the entirety of the statute.  The statute also states that it is unlawful for any unlicensed person to practice architecture.  Plaintiffs’ allegations expressly allege that Defendants practiced architecture without a license.  There are sufficient facts to show a violation of Business and Professions Code section 5536 without addressing the statute’s requirements as to use of a stamp of a licensed architect, advertisement or sign, card or other device indicating architect status.  Defendants’ argument reviews the pleading’s allegations too narrowly.  Defendants’ argument that the UCL claim lacks sufficient facts to show unlawful conduct is unpersuasive.

            The demurrer to the eighth COA is OVERRULED. 

RGB’s Entire Complaint

            Defendants argue that there are no facts to show that Defendants performed any work on RGB’s property.  Again, Defendants take a very restricted view of the allegations.  Plaintiffs define the “Project” as a “medical spa location with a connected restaurant.”  The restaurant is owned by RGB.  (Compl. par. 16.)  The alleged facts expressly show that Defendants were hired to provide architectural services related to the connected restaurant owned by RGB.  Because Defendants’ argument is not supported by the factual allegation, the demurrer is unpersuasive.

            The demurrer against RGB’s entire Complaint is OVERRULED.

Allegations in Complaint pars. 101-104

            Defendants argue that Complaint paragraph 101 (Bus. & Prof. Code sec. 6787) should be stricken because there are no facts alleged to show that Defendants provided engineering services.  However, Defendants’ argument fails to recognize that Plaintiffs expressly alleged that Defendants provided engineering services (i.e., MEP drawings) and identified themselves as either the “Architect or Engineer in charge of project.”  (Compl. pars. 26, 39.)  Defendants’ argument as to paragraph 101 again is based upon an incomplete reading of the allegations.

            As to Complaint paragraphs 102-104 (Bus. & Prof. Code secs. 5536.22, 5535 and 5535.25,) Defendants argue that the allegations are irrelevant because Defendants are not alleged to be an architect.  It is undisputed that Defendants are not alleged to be architects and that these statutes are relevant to licensed architects.  However, the argument ignores that Plaintiffs also allege that Defendants collaborated with Co-Defendant Marshall, a licensed architect.  The statutory violations are relevant to claims made under such collaboration and Defendants’ request to strike the allegations are unpersuasive.

            The Motion to Strike paragraphs 101-104 is DENIED. 

Punitive Damages

            Plaintiffs’ Complaint requests punitive damages under the second through fifth COAs (Prayer par. 4.) 

The request for punitives under the second and fifth COA for concealment and breach of fiduciary duty is sufficiently pled to allege punitives under the fraud prong.  Plaintiffs sufficiently allege Defendants’ concealment of the fact that they were not licensed which deprived Plaintiffs of their property/legal rights and causing Plaintiffs’ injuries.  Plaintiffs allege that Defendants concealment of their lack of licensure caused them to incur more costs in restarting the Project.  (Compl. pars. 38 and 43.)  Because of these allegations, there is sufficient and specific fact pleading to support punitive damages.  The Motion to Strike punitive damages under the second and fifth COAs is DENIED.

The motion to strike punitive damages requested under the third COA for intentional misrepresentation is MOOT due to the Court’s ruling on the concurrent demurrer. 

As for punitives under the fourth COA for negligent misrepresentation, Civil Code section 3294(c)(3) does not include negligent misrepresentation as grounds to seek punitive damages under the fraud prong of the statute.  The Motion to Strike Punitive Damages under the fourth COA is GRANTED WITHOUT LEAVE TO AMEND.

Attorney’s Fees

            Plaintiffs request attorney’s fees under Code of Civil Procedure section 1029.8 which provides for fees when unlicensed persons cause injury to others as a result of performing services for which a license is required.  Despite Defendants’ contention otherwise, Plaintiffs sufficiently plead the statute and grounds to show that they were injured by Defendants lack of licensure as architects.  Defendants’ arguments that they are interior designers and that they performed non-architectural services are addressed in the analysis for the concurrent demurrer.  The arguments are not persuasive and insufficient to support the request to strike attorney’s fees.

            The motion to strike attorney’s fees is DENIED. 

            IT IS SO ORDERED, CLERK TO GIVE NOTICE.