Judge: Stephen P. Pfahler, Case: 22CHCV00200, Date: 2023-04-05 Tentative Ruling

Case Number: 22CHCV00200    Hearing Date: April 5, 2023    Dept: F49

Dept. F-49

Date: 4-5-23                                                     

Case # 22CHCV00200

Trial Date: Not Set

 

DEMURRER/MOTION TO DISMISS

 

MOVING PARTY: Defendants, Kevin Park, et al.

RESPONDING PARTY: Plaintiffs, Chul Chang, et al.

 

RELIEF REQUESTED

Demurrer to the Second Amended Complaint

·         1st Cause of Action: Cancellation of Written Instruments

·         2nd Cause of Action: Quiet Title

·         3rd Cause of Action: Fraud

·         4th Cause of Action: Undue Influence (elder abuse)

·         5th Cause of Action: Declaratory Relief

 

Motion to Dismiss the Action

 

SUMMARY OF ACTION

“Plaintiff is the widow of Thomas P. Kim,” and “Choon S. Kim is Decedent’s predeceased first spouse who died in 2015.” Defendant Leslie Hyun Park “is the daughter of Decedent,” and defendant Kevin Sachun Park is the spouse” of Leslie Park, “and the son-in-law of Decedent.”

 

Plaintiff asserts a community property interest in 23740 Forest View Court, Santa Clarita. Thomas Kim passed away on October 6, 2021. On October 4, 2021, Thomas “purportedly executed a Grant Deed transferring the Property to ‘Kevin Sachun Park and Leslie Hyun Park, as Trustees of the Kevin and Leslie Partk 2015 Trust dated December 9, 2015.” The Grant Deed was recorded on October 5, 2021.

 

On March 24, 2022, Plaintiffs filed a (verified) complaint for Cancellation of Written Instruments, Quiet Title, Fraud, Undue Influence (elder abuse), and Declaratory Relief. On April 4, 2022, Plaintiffs recorded a Notice of Pendency of Action (Lis Pendens). On July 14, 2022, Plaintiffs filed their first amended (verified) complaint for Cancellation of Written Instruments, Quiet Title, Fraud, Undue Influence (elder abuse), and Declaratory Relief. On September 9, 2022, Plaintiff Kyong Chang filed a second verification for the first amended complaint.

 

On October 25, 2022, the court sustained the demurrer to the first amended complaint with leave to amend. On November 30, 2022, Plaintiffs filed a second amended verified complaint for Cancellation of Written Instruments, Quiet Title, Fraud, Undue Influence (elder abuse), and Declaratory Relief.

 

RULING

Motion to Dismiss: DENIED

Defendant submits a motion to dismiss and demurrer to the second amended complaint. Because the motion to dismiss repeats part of the argument raised in the demurrer, the court addresses the motion to dismiss as part of the demurrer.

 

Demurrer: Sustained With Leave To Amend In Part/Overruled in Part.

Defendants Kevin Sachun Park and Leslie Hyun Park, individually, and as Trustees of the Kevin and Leslie Partk 2015 Trust dated December 9, 2015 demurrer to the second amended complaint on grounds that the second amended complaint improperly substitutes parties without leave of court, Plaintiffs lack any claim of a community property interest, and the individual cause of action lack sufficient facts to pled any cause of action. Plaintiffs in opposition represents the first amended complaint is now verified, Plaintiff holds a community property interest in the property, and all causes of action are properly alleged. Defendants in reply reiterate the arguments of the demurrer.

 

A demurrer is an objection to a pleading, the grounds for which are apparent from either the face of the complaint or a matter of which the court may take judicial notice. (Code Civ. Proc., § 430.30, subd. (a); see also Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) The purpose of a demurrer is to challenge the sufficiency of a pleading “by raising questions of law.” (Postley v. Harvey (1984) 153 Cal.App.3d 280, 286.) “In the construction of a pleading, for the purpose of determining its effect, its allegations must be liberally construed, with a view to substantial justice between the parties.” (Code Civ. Proc., § 452.) The court “ ‘ “treat[s] the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law . . . .” ’ ” (Berkley v. Dowds (2007) 152 Cal.App.4th 518, 525.) In applying these standards, the court liberally construes the complaint to determine whether a cause of action has been stated.  (Picton v. Anderson Union High School Dist. (1996) 50 Cal.App.4th 726, 733.)

 

Defendants generally submit the demurrer on grounds of uncertainty. “A demurrer for uncertainty is strictly construed, even where a complaint is in some respects uncertain, because ambiguities can be clarified under modern discovery procedures.” (Khoury v. Maly's of California, Inc. (1993) 14 Cal.App.4th 612, 616; Williams v. Beechnut Nutrition Corp. (1986) 185 Cal.App.3d 135, 139 [“[U]nder our liberal pleading rules, where the complaint contains substantive factual allegations sufficiently apprising defendant of the issues it is being asked to meet, a demurrer for uncertainty should be overruled or plaintiff given leave to amend.]

 

New Party Substitution

Defendants first challenge the second amended complaint on grounds that Plaintiffs substituted Kyong Cha Chang as Plaintiff through attorney in fact Chul Chang without leave of court. The first amended complaint identified Plaintiff as Chul Chang, as Attorney in Fact for Kyong Cha Chang. Plaintiff maintains the change was proper following the October 25, 2022, minute order whereby the court noted the lack of any power of attorney form to the operative complaint in support of the identified relationship between Plaintiff and the attorney in fact. The change is presented as a means of “clarifying the identity of Plaintiff.” Defendants in reply challenge the lack of any opposition to the motion to dismiss. As for the reply to the demurrer, Defendants reiterate the “improper” substitution of party argument.

 

The court finds the switch from Chul Chang, as attorney in fact for Kyong Cha Chang to Kyong Cha Chang by her attorney in fact Chul Chang constitutes a non-prejudicial distinction without prejudice. An update of facts in support of existing claims is both allowed and specifically addressed in the October 25, 2022 minute order sustaining the demurrer to the first amended complaint. (Harris v. Wachovia Mortgage, FSB (2010) 185 Cal.App.4th 1018, 1023.) The demurrer is therefore overruled on this argument. The court also DENIES the unopposed MOTION TO DISMISS or alternative motion to strike on this basis as well.

 

The court also finds the argument regarding the late-filed second amended complaint lacking any support. [See Motion to Dismiss 4:25-27.] The second amended complaint was not only timely filed on November 30, 2022, but the representation of the lack of filing of any complaint as of the December 12, 2022, filed notice of motion dismiss directly contradicts the court filed and scanned document.

 

Community Property

Defendants challenge the lack of an alleged community property interest in the property. Defendants contend the lack of any community property interest due to the acquisition of the property prior to the marriage, and therefore the presumption of separate property. [Sec. Amended Comp., ¶¶ 8, 17-19, 21.] (Fam. Code, §§ 760, 770.)

 

Defendants also deny the existence of any community property interest simply from the payment of debts, maintenance and taxes on the property from 2016 to 2018, with community property funds. Defendants qualitatively challenge the source of said contributory funds by Plaintiff as social security retirement income. [Sec. Amended Comp., ¶¶ 22-23.]

 

Plaintiff in opposition cites to paragraph 22 of the second amended complaint for the premise of an alleged community property interest. The community property interest in and of itself arises from the contributory payments, and any arguments challenging qualitative distinctions exceeds the scope of the demurrer.

 

Defendants in reply contend Plaintiff “intentionally” seek to “misinform the court.” The argument more specifically challenges Plaintiff’s interpretation of the case law. Defendants also reiterate the lack of any “qualifying” payments towards establishing a community property interest.

 

The court finds no basis for a rebuttal of the presumption for a finding of separate property, such as a transmutation of title by Kim. (Fam. Code, § 852, sub. (a).) The death of Kim in no way alters the presumption of separate title as well. (In re Brace (2020) 9 Cal.5th 903, 932-933.)

 

As for a community property interest based on the approximate two-year period of contribution, Defendants also challenge any such claim. The court reviews the standard based on the allegations of contributory payments towards the jointly occupied home.

 

“Where community funds are used to make payments on property purchased by one of the spouses before marriage ‘the rule developed through decisions in California gives to the community a pro tanto community property interest in such property in the ratio that the payments on the purchase price with community funds bear to the payments made with separate funds.’ (Citations.) This rule has been commonly understood as excluding payments for interest and taxes. For example in Bare v. Bare, the Court of Appeal directed the trial court to determine the increase in equity in the house during marriage and the fair market value of it before and after the marriage, stating: ‘the community is entitled to a minimum interest in the property represented by the ratio of the community investment to the total separate and community investment in the property. In the event the fair market value has increased disproportionately to the increase in equity the wife is entitled to participate in that increment in a similar proportion.’” (In re Marriage of Moore (1980) 28 Cal.3d 366, 371–372.) “The formula gives recognition to the economic value of any loan proceeds contributed toward the purchase of the property.” (In re Marriage of Marsden (1982) 130 Cal.App.3d 426, 437.)

 

The plain language of paragraph 22 of the operative complaint states: “From 2016 to 2021, Thomas and Plaintiff resided together on the Property. Prior to February 2018, Thomas functioned as the financial manager of the marital estate. During that time, all payments associated with the Property, including debt service, property taxes, insurance, maintenance and repairs were made from community funds of Thomas and Plaintiff.” While the allegations regarding taxes and perhaps maintenance are not factors towards any determination of a community property interest, the complaint specifically articulates “debt service,” which the court considers as a contribution towards the equity in the property. The arguments raised in reply challenging the qualitative definition of debt service constitutes extrinsic inference beyond the scope of the demurrer. Thus, for purposes of the demurrer, the contributions to the equitable share of the property allege a claim for community property.

 

Still, Defendants present an unopposed argument distinguishing the source of the funds as barred under the community property equitable contribution standard. Paragraph 23 of the operative complaint states: “Plaintiff paid for the daily needs of herself and Thomas from her savings and Thomas’ Social Security, but otherwise had no access to Thomas’ accounts.” Social Security benefits incurred prior to the marriage in fact remain separate property. (In re Marriage of Peterson (2016) 243 Cal.App.4th 923, 930–931.)

 

While Defendants correctly cite to the bar on the social security reference, the argument also disregards any reference to personal “savings,” and cites no authority against it. The later argument in the reply characterizing the preexisting savings account “as separate property” improperly ignores the act of utilizing said funds towards the payment of funds. Again, the court declines to consider said extrinsic, qualitative distinctions. The demurrer is therefore overruled as to any bar on the lack of a community property interest for the period of time contributions towards the equity in the property were made.

 

1st Cause of Action, Cancellation of Written Instruments: Overruled.

The operative complain seeks to rescind the October 4, 2021, executed Grant Deed. Defendants challenge the cancellation of written instruments claim on grounds that Plaintiff fails to allege a claim for title to on the property, even accepting the community property payments towards the home. Even if the 2021 grant deed were cancelled, the property would still revert to the prior separate property of the defendants. Plaintiff in opposition relies on the community property interest as the basis of support, and cites to the elements of the claim for support. Defendants in reply reiterate the community property challenges.

 

“A written instrument, in respect to which there is a reasonable apprehension that if left outstanding it may cause serious injury to a person against whom it is void or voidable, may, upon his application, be so adjudged, and ordered to be delivered up or canceled.” (Civ. Code, § 3412.) “Under Civil Code section 3412, ‘[a] written instrument, in respect to which there is a reasonable apprehension that if left outstanding it may cause serious injury to a person against whom it is void or voidable, may, upon his application, be so adjudged, and ordered to be delivered up or canceled.’ To prevail on a claim to cancel an instrument, a plaintiff must prove (1) the instrument is void or voidable due to, for example, fraud; and (2) there is a reasonable apprehension of serious injury including pecuniary loss or the prejudicial alteration of one's position.” (U.S. Bank National Assn. v. Naifeh (2016) 1 Cal.App.5th 767, 778.)

 

As addressed above, Plaintiff successfully alleges a community property interest in the property based on equitable contribution to the property. The cause of action itself only seeks to challenge the 2021 grant deed. While Defendants correctly note the lack of any allegations overcoming the prior assumption regarding separate property as addressed above, nothing in such an argument prevents Plaintiff from challenging the 2021 grant deed without further extrinsic inference into the consequences of the result. In other words, nothing in the potential recission of the 2021 grant deed thereby restoring title under the prior alleged state in any way bars the subject action. The court otherwise finds no challenge to the elements or validity of the claim for purposes of the demurrer. The demurrer is therefore overruled.

 

2nd Cause of Action, Quiet Title: Overruled.

Like the Cancellation of Written Instruments, the Quiet Title cause of action challenge derives from the community property interest claim and reversion to the prior title argument. Plaintiff cites back to the community property interest in opposition. Defendants in reply reiterate the community property challenges.

 

A quiet title action requires the following:

 

The complaint shall be verified and shall include all of the following:

 

(a) A description of the property that is the subject of the action. In the case of tangible personal property, the description shall include its usual location. In the case of real property, the description shall include both its legal description and its street address or common designation, if any.

(b) The title of the plaintiff as to which a determination under this chapter is sought and the basis of the title. If the title is based upon adverse possession, the complaint shall allege the specific facts constituting the adverse possession.

(c) The adverse claims to the title of the plaintiff against which a determination is sought.

(d) The date as of which the determination is sought. If the determination is sought as of a date other than the date the complaint is filed, the complaint shall include a statement of the reasons why a determination as of that date is sought.

(e) A prayer for the determination of the title of the plaintiff against the adverse claims.

 

Code Civ. Proc., § 761.020

 

As addressed above, the community property interest is properly pled, and the court declines to consider any extrinsic inferences regarding the absence of the 2021 grant deed. Defendants otherwise offer no challenge to the validity of the elements of the quiet title claim. The demurrer is overruled.

 

3rd Cause of Action, Fraud: Sustained with Leave to Amend.

On Fraud, Defendants argue a lack of sufficient facts. Plaintiffs counter that the complaint sufficiently articulates fraud based on either representation or concealment. Defendants in reply reiterates the factual insufficiency argument.

 

“‘The elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or “scienter”); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage.’” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.) 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. (Civ.Code, § 1710, subd. (3) [a deceit includes “[t]he suppression of a fact, by one who is bound to disclose it, or who gives information of other facts which are likely to mislead for want of communication of that fact”]; Citation.)” (Hoffman v. 162 North Wolfe LLC (2014) 228 Cal.App.4th 1178, 1186.)

 

The second amended complaint again relies on conclusions of false representations to the decedent, without articulation of any alleged statement. The operative complaint alternatively lacks any basis of disclosure. To the extent any false representations were made to the decedent, it’s not clear how Plaintiffs allege any basis of reliance. Voiding the last grant deed still vests the property back to the separate property agreement. Further, Plaintiffs lack any pled basis of standing to bring any claim on behalf of decedent, if Plaintiffs in fact seek to allege such a claim.

 

The demurrer is sustained with leave to amend.

 

4th Cause of Action, Undue Influence (elder abuse): Sustained with Leave to Amend.

Defendants challenge the lack of facts in support of the elder financial abuse claim. Plaintiff counters with citation to the operative complaint as support for the claim. Defendants in reply contend Plaintiff insufficiently articulates the claim or resulting inequity.

 

Welfare and Institutions Code section 15610.30 defines financial abuse.

 

(a) “Financial abuse” of an elder or dependent adult occurs when a person or entity does any of the following:

(1) Takes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.

(2) Assists in taking, secreting, appropriating, obtaining, or retaining real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.

(3) Takes, secretes, appropriates, obtains, or retains, or assists in taking, secreting, appropriating, obtaining, or retaining, real or personal property of an elder or dependent adult by undue influence as defined in Section 15610.70.

(b) A person or entity shall be deemed to have taken, secreted, appropriated, obtained, or retained property for a wrongful use if, among other things, the person or entity takes, secretes, appropriates, obtains, or retains the property and the person or entity knew or should have known that this conduct is likely to be harmful to the elder or dependent adult.

(c) For purposes of this section, a person or entity takes, secretes, appropriates, obtains, or retains real or personal property when an elder or dependent adult is deprived of any property right, including by means of an agreement, donative transfer, or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.

…

 

(a) “Undue influence” means excessive persuasion that causes another person to act or refrain from acting by overcoming that person's free will and results in inequity. In determining whether a result was produced by undue influence, all of the following shall be considered:

(1) The vulnerability of the victim. Evidence of vulnerability may include, but is not limited to, incapacity, illness, disability, injury, age, education, impaired cognitive function, emotional distress, isolation, or dependency, and whether the influencer knew or should have known of the alleged victim's vulnerability.

(2) The influencer's apparent authority. Evidence of apparent authority may include, but is not limited to, status as a fiduciary, family member, care provider, health care professional, legal professional, spiritual adviser, expert, or other qualification.

(3) The actions or tactics used by the influencer. Evidence of actions or tactics used may include, but is not limited to, all of the following:

(A) Controlling necessaries of life, medication, the victim's interactions with others, access to information, or sleep.

(B) Use of affection, intimidation, or coercion.

(C) Initiation of changes in personal or property rights, use of haste or secrecy in effecting those changes, effecting changes at inappropriate times and places, and claims of expertise in effecting changes.

(4) The equity of the result. Evidence of the equity of the result may include, but is not limited to, the economic consequences to the victim, any divergence from the victim's prior intent or course of conduct or dealing, the relationship of the value conveyed to the value of any services or consideration received, or the appropriateness of the change in light of the length and nature of the relationship.

(b) Evidence of an inequitable result, without more, is not sufficient to prove undue influence.

 

Welf. & Inst. Code, § 15610.70

 

Like the fraud cause of action, the court finds no basis of standing. The court also finds the mere existence of the execution of the grant deed two days before death lacks sufficient support of harm to Kim, thereby supporting the claim. The demurrer is sustained with leave to amend.

 

5th Cause of Action, Declaratory Relief: Sustained with Leave to Amend.

Defendants challenge the lack of a any actual controversy based on the continuing challenge to any claimed property interest. Defendants also cite to the statute of frauds as a basis of undermining the claim. Plaintiff counters that declaratory relief is properly pled. Defendants in reply reiterate the community property challenges.

 

Declaratory relief arises under Code of Civil Procedure section 1060, which states in part:

 

“Any person interested under a written instrument … or under a contract, or who desires a declaration of his or her rights or duties with respect to another, or in respect to, in, over or upon property … may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an original action or cross-complaint in the superior court for a declaration of his or her rights and duties in the premises, including a determination of any question of construction or validity arising under the instrument or contract. He or she may ask for a declaration of rights or duties, either alone or with other relief; and the court may make a binding declaration of these rights or duties, whether or not further relief is or could be claimed at the time. The declaration may be either affirmative or negative in form and effect, and the declaration shall have the force of a final judgment. The declaration may be had before there has been any breach of the obligation in respect to which said declaration is sought.”

 

“‘[S]ection 1060 does not require a breach of contract in order to obtain declaratory relief, only an ‘actual controversy.’ Declaratory relief pursuant to this section has frequently been used as a means of settling controversies between parties to a contract regarding the nature of their contractual rights and obligations.’” (Osseous Technologies of America, Inc. v. DiscoveryOrtho Partners LLC (2010) 191 Cal.App.4th 357, 365.) Declaratory relief operates prospectively. (Id. at p. 366.)

 

“[U]nder California rules, an actual controversy that is currently active is required for such relief to be issued, and both standing and ripeness are appropriate criteria in that determination. (Citation.) One cannot analyze requested declaratory relief without evaluating the nature of the rights and duties that plaintiff is asserting, which must follow some recognized or cognizable legal theories, that are related to subjects and requests for relief that are properly before the court.”

 

(Otay Land Co.v. Royal Indemn. Co. (2008) 169 Cal.App.4th 556, 563.)

 

The arguments regarding the statute of frauds is not a proper defense to declaratory relief. The court therefore declines to consider this argument.

 

To the extent the operative complaint relies on the invalidity of the grant deed, the subject cause of action both incorporates the properly alleged challenges under the claims for cancellation of instruments and quiet title, as well as the defective claims under the fraud and elder abuse claims. Still, the crux of the dispute arises from a challenge to the validity of the transfer rather than a declaration of rights under the established community property interest. [Sec. Amend. Comp., ¶¶ 54-56.] The court therefore finds a factually insufficient pled declaratory relief claim in that the fraud based claims lack support for the articulation of an ongoing controversy. The demurrer is therefore sustained.

 

 

The demurrer is therefore overruled as to the cancellation of instruments and quiet title causes of action, and sustained with 20 days leave to amend as to fraud, elder abuse, and declaratory relief. Plaintiff may not add a new cause of action. (Harris v. Wachovia Mortgage, FSB (2010) 185 Cal.App.4th 1018, 1023.) Plaintiff may provide additional factual allegations in order to support the claims.

 

The court has now twice considered challenges to the complaint. “In response to a demurrer and prior to the case being at issue, a complaint or cross-complaint shall not be amended more than three times, absent an offer to the trial court as to such additional facts to be pleaded that there is a reasonable possibility the defect can be cured to state a cause of action. The three-amendment limit shall not include an amendment made without leave of the court pursuant to Section 472, provided the amendment is made before a demurrer to the original complaint or cross-complaint is filed.” (Code Civ. Proc., § 430.41, subd. (e)(1).) Should an a third amended complaint be filed and a third demurrer presented to the court, the court will consider the applicable standard in determining whether Plaintiff can properly allege the challenged claims. Any demurrer may only be made to the three sustained causes of action.

 

If Plaintiff choses to forego amending the complaint, Defendants are ordered to answer the remaining causes of action in the operative complaint within 10 days of the lapsed amendment period.

 

Defendants to give notice.