Judge Upinder S. Kalra, Case Number: 22STCV38881, Date: 2023-08-08 Tentative Ruling

1. Demurrer to the First Cause of Action for failure to state facts sufficient and for uncertainty. (CCP §§ 430.10(e) and 430.10(f).)

2. Demurrer to the Fourth Cause of Action for failure to state facts sufficient and for uncertainty. (CCP §§ 430.10(e) and 430.10(f).)

On December 14, 2022, Plaintiff Arthur Ross Allen (Plaintiff) filed a Complaint against Defendants Jaime A. Calderon and Raul Trevino.

On June 2, 2023, Defendant Raul Trevino (Defendant Trevino) filed a Demurrer to the Complaint, which the court SUSTAINED on August 8, 2023 with leave to amend.

On August 25, 2023, Plaintiff filed a First Amended Complaint (FAC) with four causes of action for: (1) Breach of Contract, (2) Conversion, (3) Unjust Enrichment, and (4) Declaratory Relief.

According to the FAC, Plaintiff provided $200,000 to Defendants as an investment to help Defendants invest in another company, 1041 Wall Street Inc., a marijuana growing and dispensary business. However, Plaintiff alleges that Defendants breached their agreement by failing to pay back Plaintiff’s original investment and any net profits. Plaintiff also alleges that they are entitled to some of the settlement monies that are held in a trust account based on Defendants’ separate litigation with 1041 Wall Street Inc.

On October 3, 2023, Defendant Raul Trevino (Defendant Trevino) filed the instant Demurrer. Plaintiff timely filed an opposition on October 25, 2023. Defendant Trevino’s timely filed a reply on November 1, 2023.

A demurrer for sufficiency tests whether the complaint states a cause of action.¿(Hahn v. Mirda¿(2007) 147 Cal.App.4th 740, 747.) When considering demurrers, courts read the allegations liberally and in context.¿In a demurrer proceeding, the defects must be apparent on the face of the pleading or via proper judicial notice.¿(Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.)¿“A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. …. The only issue involved in a demurrer hearing is whether the complaint, as it stands, unconnected with extraneous matters, states a cause of action.”¿(Hahn¿147 Cal.App.4th at 747.)

When considering demurrers, courts read the allegations liberally and in context, accepting the alleged facts as true. (Nolte v. Cedars-Sinai Medical Center (2015) 236 Cal.App.4th 1401, 1406.) Courts also consider exhibits attached to the complaint and incorporated by reference. (See Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94 (Frantz).)

Prior to filing a demurrer, the demurring party is required to satisfy their meet and confer obligations pursuant to Code of Civ. Proc. §430.41, and demonstrate that they so satisfied their meet and confer obligation by submitting a declaration pursuant to Code of Civ. Proc. §430.41(a)(2) & (3). Upon reviewing the Declaration of Aaron J. Flores, it does not appear that the parties met and conferred prior to Defendant Trevino’s filing the instant demurrer. (Flores Decl. ¶ 12.)

The court is unaware of any legal authority which requires a court to rule on evidentiary objections on a motion, except as to a motion for summary motion/adjudication [CCP § 437c (q)] or a special motion to strike [CCP § 425.16 (b)(2); see also, Sweetwater Union High School Dist. v. Gilbane Building Co. (2019) 6 Cal.5th 931, 947-949.] As such, the court respectfully declines to rule on any of these objections. The court is well aware of the rules of evidence, and to how much weight, if any, should be given to any of the proposed evidence.[1]

As a threshold matter, the court declines to develop Defendant Trevino’s argument that the First and Fourth Causes of Action are uncertain. “[D]emurrers for uncertainty are disfavored, and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.” (Morris v. JPMorgan Chase Bank, N.A. (2022) 78 Cal.App.5th 279, 292.) Here, the court does not agree with Defendant Trevino that the FAC is “so incomprehensible” that he cannot “reasonably respond” to the claims against him.

Defendant Trevino contends that the statute of limitations accrued at the latest on May 23, 2018 and that Plaintiff’s new allegations in the FAC would make this date earlier, not later. As such, Plaintiff’s filing on December 14, 2022 was after the limitations period ran.[2] Plaintiff argues that the statute of limitations began to run on January 30, 2019, 60 weeks after the parties executed the Agreement on December 6, 2017.[3]

The statute of limitations for breach of written contract is four years from the date of the breach. (CCP § 337(a).)

Upon reviewing the FAC, Plaintiff has still failed to unambiguously alleged that the statute of limitations does not bar the instant action. While Plaintiff alleges that Defendants did not inform Plaintiff that they had filed a lawsuit on May 23, 2018 at the time of the lawsuit, reading the entire FAC in context, it is clear that Plaintiff learned of the lawsuit at some time earlier.[4] The unanswered allegation is WHEN? This is significant because this date would potentially trigger the running of the statute of limitations. It could also defeat Plaintiff’s performance contention (i.e., repayment of the initial investment proceeds) was not due until January 30, 2019 (60 weeks after the parties entered the Agreement) if Plaintiff had knowledge that there was no longer any type of valid cultivation agreement because of the pending lawsuit. (FAC ¶¶ 12, 25.)

1. The court SUSTAINS Defendant Trevino’s Demurrer as to the two causes of action that are challenged with 20 days leave to amend.[5]

[1] The court notes that because Mr. Allen’s declaration was not an exhibit to the FAC, the court is not obligated to consider it. (See Frantz, supra, at p. 94.)

[2] Defendant Trevino’s challenge to the Fourth Cause of Action for Declaratory Relief is on statute of limitations grounds only (contending that it fails since the Breach of Contract claim fails). The court did not see any argument from Defendant Trevino that addresses the elements of Declaratory Relief. Accordingly, the court will not analyze whether Plaintiff alleged facts sufficient to support such a cause of action or whether this cause of action is uncertain.

[3] Plaintiff cites Steiner v. Parker (1959) 169 Cal.App.2d 22, 25 to support his position that the limitations period did not begin to run until expiration of the 60-week period.

[4] Plaintiff alleges that he was “recently” told by Defendant Trevino that he was not entitled to any settlement monies resulting from the June 2022 settlement of the May 23, 2018 lawsuit which clearly suggests knowledge of the lawsuit at an earlier date. (FAC ¶ 18, 19, 20, 21, 22.)

[5] This will also give Plaintiff an opportunity to cure purported scrivener errors and include allegations Plaintiff deems appropriate from the supplemental declaration attached to the Reply.