Judge: Stephen P. Pfahler, Case: 22CHCV00637, Date: 2023-03-13 Tentative Ruling

Case Number: 22CHCV00637    Hearing Date: March 13, 2023    Dept: F49

Dept. F-49

Date: 3-13-23

Case # 22CHCV00637

Trial Date: N/A

 

DEMURRER

 

MOVING PARTY: Defendant, Northwestern Mutual Life Insurance Company

RESPONDING PARTY: Plaintiffs, Albert Hughes, et al.

 

RELIEF REQUESTED

Demurrer to the Complaint

·         1st Cause of Action: Breach of Civil Code section 1710.2

·         2nd Cause of Action: Fraud, Deceit, and Misrepresentation

·         3rd Cause of Action: Breach of Contract

·         4th Cause of Action: Intentional Infliction of Emotional Distress

·         5th Cause of Action: Negligence

·         6th Cause of Action: Negligent Hiring, Supervision, Retention of Employee

·         7th Cause of Action: Breach of Business and Professions Code section 17200

·         8th Cause of Action: Breach of Civil Code section 1942.4

 

Motion to Strike

·         Allegations in Support of, and Claim for, Punitive and Treble Damages

·         Claim for Attorney Fees

 

SUMMARY OF ACTION

On October 30, 2021, plaintiffs Albert Hughes and Sabrina Crawford toured the premises of 9400 Corbin Ave., Northridge, for a potential apartment unit rental. The apartments are owned and/or managed by defendant The Northwestern Mutual Life Insurance Company dba Terrena. Defendant Laura De Leon is identified as the leasing agent, and person Plaintiffs met with at the time of the October 30, 2021 tour.

 

Plaintiffs were shown apartment 4089, and expressed an interest in renting the unit. On November 24, 2021, Plaintiffs appeared on the premises to execute a lease for unit 4089. Plaintiffs took a tour of the unit prior to signing, and noticed a broken window in the hallway of an unidentified unit. Upon inquiry, the broken window was described as a result of “rowdy tenants.” A damaged door on unit on unit 4088 was also blamed on college student parties.

 

Plaintiffs signed a 10-month lease, and commenced their occupation on November 27, 2021. Plaintiffs subsequently learned that the damage to the property was caused by a homicide on the premises on August 6, 2021. The damage to the window was the result of gunfire.

 

Upon confronting Defendants for the failure to disclose the homicide on the premises, Defendants disputed any purported homicide on the premises and maintained the violence occurred off-site. Plaintiffs also maintain the security standards on the premises were lacking, such as the locked gate, thereby allowing criminals to freely roam.

 

On August 15, 2022, Plaintiffs filed their complaint for Breach of Civil Code section 1710.2; Fraud, Deceit, Misrepresentation, Concealment; Breach of Contract; Intentional Infliction of Emotional Distress; Negligence; Negligent Hiring, Supervision, or Retention of Employee; Breach of Business and Professions Code section 17200; and Breach of Civil Code section 1942.4.

 

RULING

Demurrer: Sustained with Leave to Amend in Part/Overruled in Part.

Defendant Northwestern Mutual Life Insurance Company (Northwestern) brings the subject demurrer to the entire complaint Breach of Civil Code section 1710.2; Fraud, Deceit, Misrepresentation, Concealment; Breach of Contract; Intentional Infliction of Emotional Distress; Negligence; Negligent Hiring, Supervision, or Retention of Employee; Breach of Business and Professions Code section 17200; and Breach of Civil Code section 1942.4. Northwestern challenges the complaint on grounds of uncertainty and insufficient facts. Plaintiffs in opposition maintain all claims are properly pled. Defendant in reply challenges the late served opposition, contends the opposition fails to sufficiently respond to the arguments raised in the demurrer, and challenges any request for leave to amend in order to add new causes of action.

 

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.)

 

“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.]

 

The court accepts the timely filed, but later served and corrected opposition.

 

1st Cause of Action, Breach of Civil Code section 1710.2: Sustained with Leave to Amend.

Northwestern challenges the lack of any claim in that nothing in the complaint alleges an actual homicide occurring in unit 4089, thereby triggering the disclosure requirement.

 

Civil Code section 1710.2 requires the disclosure of a death on the premises for a three-year period following, with certain non-applicable exceptions. (Civ. Code, § 1710.2.) Northwestern maintains the statute only applies to the unit itself and incidents outside the unit are not subject to mandatory disclosure rules. Northwestern cites to Plaintiffs’ own complaint regarding the representation of the homicide occurring in the fitness center, though it’s not clear from the operative complaint whether said area constitutes a common area of the premises or an off-site area. [Comp., ¶ 16.] The parties treat the area as “common area” under control of Northwestern, but such argument is extrinsic to the scope of the pleading and therefore the demurrer.

 

The arguments regarding the parameters for the scope of disclosure requirements lack any legal support—the rental unit versus the common areas. Nevertheless, the plain language of the statute uses the word “occupant” which supports the argument that the disclosure applies to the unit itself, since a tenant does not “occupy” a common area, and instead only enjoys license of access. The court therefore sustains the demurrer due to the failure to sufficiently articulate a violation of the statute.  The demurrer is sustained.

 

2nd Cause of Action, Fraud, Deceit, and Misrepresentation: Sustained with Leave to Amend.

Northwestern submits the subject demurrer to the fraud cause of action in on grounds of insufficient factual particularity. Plaintiff maintains the complaint sufficiently articulates fraud.

 

“‘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.’” … [¶] ‘Promissory fraud’ is a subspecies of the action for fraud and deceit. A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such intention, there is an implied misrepresentation of fact that may be actionable fraud.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.)

 

“‘Active concealment or suppression of facts by a nonfiduciary “is the equivalent of a false representation, i.e., actual fraud.” [Citation.] (Citation).)’ 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.) “[T]he elements of an action for fraud and deceit 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.” (Marketing West, Inc. v. Sanyo Fisher (USA) Corp. (1992) 6 Cal.App.4th 603, 612–613.) “A plaintiff's burden in asserting a fraud claim against a corporate employer is even greater. In such a case, the plaintiff must ‘allege the names of the persons who made the allegedly fraudulent representations, their authority to speak, to whom they spoke, what they said or wrote, and when it was said or written.’” (Lazar v. Superior Court, supra,12 Cal.4th at p. 645.)

 

Plaintiffs, at least in part, specifically allege Civil Code section 1710.2, as the basis of disclosure. [Comp., ¶ 41.] While subject statute supports the basis of disclosure, given the deficiencies noted with the failure to establish a violation of any disclosure requirements, Plaintiffs lack actual support for the fraud claim. The demurrer is sustained.

 

3rd Cause of Action, Breach of Contract: Overruled.

Northwestern characterizes the subject claim as one for fraudulent inducement, but specifically challenge the cause of action on grounds that the complaint fails to identify the parties to the lease, or any basis of breach. Plaintiff counters that the complaint properly states the claim.

 

“To state a cause of action for breach of contract, [a plaintiff] must plead the contract, his performance of the contract or excuse for nonperformance, [defendant’s] breach and the resulting damage. (Citation.) Further, the complaint must indicate on its face whether the contract is written, oral, or implied by conduct. (Citation.)” (Otworth v. Southern Pac. Transportation Co. (1985) 166 Cal.App.3d 452, 458–59.) In examining a breach of contract claim, the court is required to examine the terms, or at least the legal effect of the contract. (Blank v. Kirwan, supra, 39 Cal.3d at p. 318 [“we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context”]; Otworth v. Southern Pac. Transportation Co., supra, 166 Cal.App.3d at p. 459 [“If the action is based on an alleged breach of a written contract, the terms must be set out verbatim in the body of the complaint or a copy of the written instrument must be attached and incorporated by reference”]; Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 198–199 [“In an action based on a written contract, a plaintiff may plead the legal effect of the contract rather than its precise language”].) Formation of a contract requires four elements: The parties capable of contracting, the parties consent, the contract is for a lawful object, and sufficient consideration is given. (Civ. Code, § 1550.) Consent of the parties must be free, mutual and communicated by each to the other. (Civ. Code, § 1565.) A cause of action for damages for breach of contract is comprised of the following elements: (1) the contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting damages to plaintiff.” (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1388.)

 

The complaint lacks a copy of the actual lease. Notwithstanding Plaintiffs identify the parties to the lease in paragraph 1 of the operative complaint. Plaintiffs also identify the material terms of the agreement in support of the cause of action. [Comp., ¶ 44.] The court otherwise finds the argument of the demurrer unsupported. The demurrer is overruled as to this cause of action.

 

4th Cause of Action, Intentional Infliction of Emotional Distress: Sustained with Leave to Amend.

Northwestern challenges the lack of facts supporting a claim for intentional infliction of emotional distress. Plaintiffs cite to the non-disclosure under Civil Code section 1710.2 as the basis of outrageous conduct.

 

“‘The elements of a cause of action for intentional infliction of emotional distress are (1) outrageous conduct by the defendant, (2) intention to cause or reckless disregard of the probability of causing emotional distress, (3) severe emotional suffering, and (4) actual and proximate causation of the emotional distress.’ [¶] Conduct is extreme and outrageous when it exceeds all bounds of decency usually tolerated by a decent society, and is of a nature which is especially calculated to cause, and does cause, mental distress. Liability does not extend to mere insults, indignities, threats, annoyances, petty oppressions, or other trivialities.” (Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590, 617.)

 

Other than citation to conclusions conforming to the elements for emotional distress, the operative complaint lacks any specific facts ascribing any conduct to the parties. Furthermore, Plaintiffs cannot rely on the defective non-disclosure cause of action for purposes of opposing the subject demurrer. The demurrer is sustained.

 

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

Northwestern challenges the negligence claim on grounds of insufficient facts. Plaintiffs cite back to the lack of disclosure.

 

“The elements of a cause of action for negligence are well established … (a) a legal duty to use due care; (b) a breach of such legal duty; [and] (c) the breach as the proximate or legal cause of the resulting injury.” (Ladd v. County of San Mateo (1996) 12 Cal.4th 913, 917.) Like the emotional distress claim, the complaint relies on a series of conclusions without any factually pled basis of duty. Again, Plaintiffs cannot rely on the defective non-disclosure cause of action for purposes of opposing the subject demurrer. The demurrer is sustained.

 

6th Cause of Action: Negligent Hiring, Supervision, Retention of Employee: Overruled.

Northwestern challenges the lack of specific identification of the parties responsible for the maintenance of the premises. Plaintiffs counter the complaint sufficiently articulates the claim, and the responsible parties can be identified through discovery.

 

“Liability is based upon the facts that the employer knew or should have known that hiring the employee created a particular risk or hazard and that particular harm materializes.” (Doe v. Capital Cities (1996) 50 Cal.App.4th 1038, 1054.) “Liability for negligent hiring and supervision is based upon the reasoning that if an enterprise hires individuals with characteristics which might pose a danger to customers or other employees, the enterprise should bear the loss caused by the wrongdoing of its incompetent or unfit employees.” (Mendoza v. City of Los Angeles (1998) 66 Cal.App.4th 1333, 1339.)

 

The complaint sufficiently articulates insufficient maintenance of the premises for purposes of alleging negligent hiring, supervision, and retention. The demurrer is overruled.

 

7th Cause of Action: Breach of Business and Professions Code section 17200: Overruled.

Northwestern challenges the subject claim on grounds of no unlawful, unfair or fraudulent conduct. Plaintiffs contend the complaint finds support based, at least in part, on the non-disclosure of the prior homicide.

 

“The UCL does not proscribe specific acts, but broadly prohibits ‘any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising....’” [¶] “‘A private plaintiff must make a twofold showing: he or she must demonstrate injury in fact and a loss of money or property caused by unfair competition.’ (Citation.)” (Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1359.) Fact specific pleading is not required in order to allege an unfair business practice. (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 46–47.

 

An “unlawful” practice “means any practices forbidden by law, be it civil or criminal, federal, state, or municipal, statutory, regulatory, or court-made.… ‘Unfair’ simply means any practice whose harm to the victim outweighs its benefits. (Citation.) ‘Fraudulent,’ as used in the statute, does not refer to the common law tort of fraud but only requires a showing members of the public ‘“are likely to be deceived.”’” (Saunders v. Superior Court (1994) 27 Cal.App.4th 832, 838–839.) “[A]n unfair business practice also means” the relied upon public policy provision is “tethered” to a specific regulatory provisions. (Lueras v. BAC Home Loans Servicing, LP (2013) 221 Cal.App.4th 49, 81.)

 

To the extent Plaintiffs entirely and exclusively on statutory sections other than Civil Code section 1710.2, and given the terse support for the demurrer, the court finds a sufficient basis of support for the subject cause of action. The demurrer is overruled.

 

8th Cause of Action: Breach of Civil Code section 1942.4: Overruled.

Northwestern challenges the subject claim on grounds that the complaint insufficiently articulates the allegedly unsafe conditions. Plaintiffs concede to the lack of articulated facts, but maintain the complaint sufficiently alleges the elements.

 

The complaint sufficiently articulates the elements. The parties may conduct discovery into the specifics. The demurrer is overruled.

 

 

Motion to Strike: Moot/Granted.

To the extent Plaintiff challenges the punitive damages under the fraud claim, the motion to strike is MOOT. The court cannot otherwise determine the basis of the claims for treble damages or attorney fees. The court declines to consider whether Plaintiffs can properly seek attorney fees as a function of the breach of contract claim, in that the complaint itself only minimally pleads the terms of the contract, which can withstand the demurrer, but falls below the required specificity for attorney fees. The motion is therefore granted.

 

 

In summary, the demurrer to the Breach of Civil Code section 1710.2; Fraud, Deceit, Misrepresentation, Concealment; Intentional Infliction of Emotional Distress; and Negligence causes of action is sustained with 30 days leave to amend, and the remainder as to the Breach of Contract; Negligent Hiring, Supervision, or Retention of Employee; Breach of Business and Professions Code section 17200; and, Breach of Civil Code section 1942.4 are overruled. The motion to strike is moot in part and granted as to the remainder.

 

Plaintiffs may NOT add new causes of action and are only granted leave to add additional facts. (Harris v. Wachovia Mortgage, FSB (2010) 185 Cal.App.4th 1018, 1023.) Any new causes of action added without leave from court are subject to a motion to strike. If Plaintiffs fails to file an amended pleading within 30 days of this order, Northwestern is ordered to answer the remaining causes of action within 10 days of the lapsed amendment deadline.

 

The court docket shows a demurrer scheduled for April 26, 2023. The court reserves the right to take the demurrer off-calendar in case of an amended pleading filed before the hearing date.

 

Moving party to give notice to all parties.