Judge: Theodore R. Howard, Case: 21-1210100, Date: 2022-11-03 Tentative Ruling
Plaintiff Xin He’s (“Plaintiff”) Motion for Summary Adjudication (“Motion”) against defendant Ashley Lui (“Defendant”) is GRANTED in part and MOOT in part.
“[T]he party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law. That is because of the general principle that a party who seeks a court's action in his favor bears the burden of persuasion thereon. (See Evid. Code, § 500.) There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Aguilar v. Atl. Richfield Co. (2001) 25 Cal. 4th 826, 850.)
“(f)(1) A party may move for summary adjudication as to one or more causes of action within an action, one or more affirmative defenses, one or more claims for damages, or one or more issues of duty, if the party contends that the cause of action has no merit, that there is no affirmative defense to the cause of action, that there is no merit to an affirmative defense as to any cause of action, that there is no merit to a claim for damages, as specified in Section 3294 of the Civil Code, or that one or more defendants either owed or did not owe a duty to the plaintiff or plaintiffs. A motion for summary adjudication shall be granted only if it completely disposes of a cause of action, an affirmative defense, a claim for damages, or an issue of duty.
(2) A motion for summary adjudication may be made by itself or as an alternative to a motion for summary judgment and shall proceed in all procedural respects as a motion for summary judgment. A party shall not move for summary judgment based on issues asserted in a prior motion for summary adjudicate on and denied by the court unless that party establishes, to the satisfaction of the court, newly discovered facts or circumstances or a change of law supporting the issues reasserted in the summary judgment motion.” (Civ. Proc. Code § 437c(f).)
“For purposes of motions for summary judgment and summary adjudication:
(1) A plaintiff or cross-complainant has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action. Once the plaintiff or cross-complainant has met that burden, the burden shifts to the defendant or cross-defendant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto. The defendant or cross-defendant shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.” (Civ. Proc. Code § 437c(p)(1).)
Plaintiff seeks judgment/adjudication as to causes of action (“COA”) Nos. 1 – Breach of Contract; 2 – Fraud; and 4 – Breach of Covenant of Good Faith and Fair Dealing.
COA No. 1 – Breach of Contract
The elements for breach of contract are: (1) parties capable of contracting, (2) mutual consent, (3) a lawful object, (4) sufficient cause or consideration, (5) plaintiff’s performance or excuse for failure to perform, (6) defendant’s breach, and (7) damage. (Civil Code §§ 1550, 1605; Stockton Mortgage, Inc. v. Tope (2014) 233 Cal.App.4th 437, 453.)
Parties agreed to exchange RMB for USD. (Sep. Statement Breach of Contract (“SSBOC”) Nos. 1-2.) Plaintiff sent RMB 2.1 million to Plaintiff. (SSBOC No. 3.) Defendant breached the agreement by not sending $350,000 to Plaintiff and instead only sent $10,000. (SSBOC Nos. 4-5.) Defendant did not repay the $340,000 despite a demand by Plaintiff. (SSBOC Nos. 8, 10, 11.) Plaintiff has shown each of the elements of the breach of contract COA, the burden transfers to Defendant to show there are triable issues of material fact.
Though Plaintiff has not followed CA ST CIVIL RULES Rule 3.1350(b) to the exact format, filing three different separate statements (one on each COA) instead of one separate statement with all information in one pleading, the court in its discretion will consider the pleadings and rule on the merits of the issues. (Truong v. Glasser (2009) 181 Cal. App. 4th 102, 118.)
For this COA, Defendant failed to make any arguments in her opposition about issue of material facts and has failed to meet the transferred burden of showing triable issues of material fact remain as to this COA. The court notes that Defendant’s separate statements omit fact No. 4 that was presented in each of Plaintiff’s separate statements, which states: “Defendant received RMB 2.1 million from Plaintiff.” The omitted fact would support consideration/payment on the part of Plaintiff for the allegations that Defendant was required to transfer USD to Plaintiff. The court also notes that while a breach of contract COA and breach of covenant of good faith and fair dealing COA can be superfluous in certain situations, even if that is the case, it does not permit the court to disregard both of the COA.
The Motion is GRANTED as to this COA.
COA No. 2 – 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.” (Lazar v. Superior Court (1996) 12 Cal. 4th 631, 638.) “In California, fraud must be pled specifically; general and conclusory allegations do not suffice. [Citations.] “Thus ' ”the policy of liberal construction of the pleadings ... will not ordinarily be invoked to sustain a pleading defective in any material respect.“ ' [Citation.] [¶] This particularity requirement necessitates pleading facts which 'show how, when, where, to whom, and by what means the representations were tendered.' ”’” (Id., at 645.)
Plaintiff has shown Defendant promised to exchange RMB for USD, but did not actually intend to follow through with the promise and did not actually follow through with the exchange. (Sep. Statement Fraud (“SSF”) Nos. 2-8.) Plaintiff has shown Defendant intended to defraud Plaintiff. (SSF Nos. 2, 4, 6-10.) Plaintiff’s justifiably relied on Defendant’s representation that Defendant would wire USD in exchange for the RMB Plaintiff had wired to Defendant. (SSF Nos. 1-3, 7, 9-11.) Plaintiff was damaged when Defendant failed/refused to transfer the agreed upon USD, or to repay the RMB. (SSF Nos. 3-8, 10, 13.) Plaintiff has met his initial burden.
Defendant’s only argument was whether there was justifiable reliance on the part of Plaintiff. Defendant showed Plaintiff copies of Defendant’s bank statements reflecting that Defendant had sufficient funds to follow through with statements regarding the transfer. Plaintiff then transferred the funds as required under the terms of the agreement and tried repeatedly to have Defendant either transfer the USD or reimburse RMD.
“Under the facts of the instant case it cannot be said that plaintiff's conduct in the light of her own intelligence and information was manifestly unreasonable. Therefore, she will not be denied recovery. Defendant [] cannot be heard to complain that plaintiff reposed too much confidence in him. “No rogue should enjoy his ill-gotten plunder for the simple reason that his victim is by chance a fool” [Citation.]. The law does not applaud fraud and condemn the victim thereof for his credulity.” (Anderson v. Thacher (1946) 76 Cal. App. 2d 50, 70.) ““The courts will not lightly seize upon some small circumstance to deny relief to a party plainly shown to have been actually defrauded against those who defrauded him on the ground, forsooth, that he did not discover the fact that he had been cheated as soon as he might have done. It is only where the party defrauded should plainly have discovered the fraud except for his own inexcusable inattention that he will be charged with a discovery in advance of actual knowledge on his part. The present case is not of that character.” (15) The possible but antiquated authority that one must assume that everyone with whom he has a business transaction is a rogue and act accordingly will not receive judicial approval. Courts rather will hold that one can act upon the presumption that there exists no intention to defraud him.” (Id.)
It was not so unreasonable that Plaintiff was justified in Defendant’s representations. Defendant has failed to meet the transferred burden of showing there are triable issues of material fact as to this COA.
The Motion is GRANTED as to this COA.
COA No. 4 – Breach of Covenant of Good Faith and Fair Dealing
“There is no obligation to deal fairly or in good faith absent an existing contract. [Citation.] If there exists a contractual relationship between the parties. . . the implied covenant is limited to assuring compliance with the express terms of the contract, and cannot be extended to create obligations not contemplated in the contract.” (Racine & Laramie, Ltd. v. Dep't of Parks & Recreation (1992)11 Cal. App. 4th 1026, 1032.) “If the allegations do not go beyond the statement of a mere contract breach and, relying on the same alleged acts, simply seek the same damages or other relief already claimed in a companion contract cause of action, they may be disregarded as superfluous as no additional claim is actually stated. Thus, absent those limited cases where a breach of a consensual contract term is not claimed or alleged, the only justification for asserting a separate cause of action for breach of the implied covenant is to obtain a tort recovery.” (Careau & Co. v. Sec. Pac. Bus. Credit, Inc. (1990) 222 Cal. App. 3d 1371, 1395.)
Plaintiff’s complaint alleges Plaintiff performed all of his duties and conditions under the agreement with Defendant and wired RMB 2.1 million to accounts designated by Defendant. (Complaint ¶ 41.) Defendant knew Plaintiff had fulfilled his duties under the contract, but Defendant breached the “implied covenant of good faith and fair dealing” under the contract. (Complaint ¶ 42.) As a result of Defendant’s breach, Plaintiff suffered harm in the amount of the debt, plus costs incurred to collect the debt. (Complaint ¶ 43.) Plaintiff’s allegations under this COA do not go beyond a mere statement of a breach of contract COA and Defendant seeks the same damages already claimed under the breach of contract COA. This COA is therefore superfluous as no additional claim is actually stated.
The Motion is MOOT as to this COA.
Plaintiff to give notice.