Judge: Stephen I. Goorvitch, Case: 22STCV06694, Date: 2022-12-08 Tentative Ruling
Case Number: 22STCV06694 Hearing Date: December 8, 2022 Dept: 39
Gustavo Valdez, et
al. v. 21st Century Management, Inc., et al.
Case No.
22STCV06694
Demurrer
Plaintiffs
Gustavo Valdez and Norma Valdez (collectively, “Plaintiffs”) filed this action on
February 23, 2022, alleging that they fell victim to a mortgage refinancing
fraud. Plaintiffs allege that they
sought to refinance their property in 2010 and sought the assistance of
Defendant Global Team Consulting (“Defendant Global”). Plaintiffs paid Defendant Global a total of
$30,000 for the purported loan modification.
However, in March 2010, Defendant Laura Ngocdiep Mai, also known as
Jacqueline Mai (“Defendant Mai”) forged a quit claim deed transferring the
property. The quit claim deed was
notarized by Defendant Sandy Lorraine Alvarez-Molina (“Defendant Alvarez-Molina”). Based upon these allegations, Plaintiffs
assert causes of action for fraud, fraudulent conveyance, forgery, and
conspiracy, as well as quiet title, unfair competition, cancellation of deed,
and declaratory relief.
Defendant Alvarez-Molina previously
demurred to these causes of action. The
Court sustained Defendant Alvarez-Molina’s demurrer with leave to amend. (See Court’s Minute Order, dated September 1,
2022.) Plaintiffs filed a first amended
complaint on October 3, 2022, asserting the same causes of action. Defendant Alvarez-Molina demurs to the first
amended complaint.
“It is black letter law that a
demurrer tests the legal sufficiency of the allegations in a complaint.”
(Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.) In
ruling on a demurrer, the court must “liberally construe[]” the allegations of
the complaint. (Code Civ. Proc., § 452.)
“This rule of liberal construction means that the reviewing court draws
inferences favorable to the plaintiff, not the defendant.” (Perez v.
Golden Empire Transit Dist. (2012) 209 Cal.App.4th 1228, 1238.)
Per Code of Civil Procedure section
338, subdivision (f)(3), “an action against a notary public on the notary
public’s bond or in the notary public's official capacity shall be commenced
within six years.” (Code Civ. Proc., §
338, subd. (f)(3).) “[E]very action
against a notary in his official capacity is subject to a six-year maximum
limitation period running from the date of the notarial act. The six-year limit applies regardless of
whether the action is based on malfeasance and whether its discovery is
delayed.” (Purdum v. Holmes (2010)
187 Cal.App.4th 916, 923.) Here, Plaintiffs allege that Defendant notarized a
forged quitclaim deed in March 2010.
(Complaint, ¶ 25.) Plaintiffs did
not file their complaint until February 23, 2022, which is more than six years after
the alleged forgery. Accordingly,
Plaintiffs’ complaint is untimely.
In opposition, Plaintiffs argue that their claims are not against
Defendant Alvarez-Molina in her official capacity as a notary. The Court disagrees. The only specific allegations against
Defendant Alvarez-Molina is that she notarized the deed:
Plaintiffs
upon information and belief, and thereupon allege, Mai conspired with
Alvarez-Molina, including reliance on false identification of Plaintiffs and/or
use of false documents and forged signatures, to notarize the forged March 2010
Quitclaim Deed. . . .
.
. .
Plaintiffs upon information and beief, and thereupon allege that at all
relevant times herein, Alvarez-Molina’s notarization of the March 2010
Quitclaim Deed and in committing the wrongful acts alleged herein, was acting
individually and as the agent and/or representative of Mai in furtherance of
the fraudulent conveyance. Mai and
Alvarez-Molina relied on false identification of Plaintiffs and/or use of false
documents and forged signatures, to notarize the forged March 2010 Quitclaim
deed.
(First Amended
Complaint, ¶¶ 24, 29.) These allegations
are based upon Alvarez-Molina’s role as a notary. “A notary’s official duties include taking
the acknowledgment of deeds, verifying the identity of signatories, and
collecting their signatures in a journal. The nature of the right sued upon, not the
form of action or relief demanded, determines the applicable statute of
limitations. (Purdum v. Holmes (2010)
187 Cal.App.4th 916, 923–924, internal quotations and citations omitted.)
Plaintiffs allege that Defendant
Alvarez-Molina was part of the fraud, independent of her act of notarizing the
quitclaim deed. Plaintiffs may pursue
their claims against Defendant Alvarez-Molina, independent of her notarizing
the quitclaim deed, if they have sufficient facts to establish that she was an
active participant in the fraud. Indeed,
a notary who actively participates in a scheme to defraud, independent of her
notarization of a document, cannot rely upon Code of Civil Procedure section 338
with respect to the underlying fraud. However,
Plaintiffs’ complaint does not satisfy the pleading standard for fraud claims. Plaintiffs must allege fraud with
particularity. “This means: (1) general
pleading of the legal conclusion of fraud is insufficient; and (2) every
element of the cause of action for fraud must be alleged in full, factually and
specifically, and the policy of liberal construction of pleading will not
usually be invoked to sustain a pleading that is defective in any material
respect.” (Wilhelm v. Pray, Price,
Williams & Russell (1986) 186 Cal.App.3d 1324, 1331.)
Plaintiffs fail to do so in this
case. The only factual allegation
against Defendant Alvarez-Molina is that she notarized false documents based
upon forged signatures. There are no
specific allegations against Defendant Alvarez-Molina independent of her role
as a notary. For example, Plaintiffs
allege that Defendant Mai, not Defendant Alvarez-Molina, created the quit claim
deed and forged the signatures. (First
Amended Complaint, ¶ 23.) Plaintiffs
allege no details concerning the alleged conspiracy between the two defendants. Nor do Plaintiffs allege that Defendant Alvarez-Molina
shared in the proceeds in the fraud and received vastly more than a mere notary
should have received for the notarization.
At heart, Plaintiffs allege nothing more than the fact that Alvarez-Molina
notarized the deed purportedly based upon an unspecified agreement with
Defendant Mai. If the Court were to permit
this case to proceed based upon these allegations, section 338 would become
meaningless, as any plaintiff could assert claims against any notary merely based
upon the notarization.
Based upon
the foregoing, the Court orders as follows:
1. The Court sustains the demurrer of Defendant
Sandy Lorraine Alvarez-Molina without leave to amend.
2. The Court continues the case management
conference to February 21, 2023, at 8:30 a.m., as not every defendant has been
served.
3. Counsel for Defendant Sandy Lorraine
Alvarez-Molina shall provide notice and file proof of such with the Court.