Judge William A. Crowfoot, Case 23AHCV00013 2023-04-17 Tentative Ruling

Judge: William A. Crowfoot, Case: 23AHCV00013, Date: 2023-04-17 Tentative Ruling

On January 4, 2023, plaintiff Marvin Mendez Martinez (“Plaintiff”) filed this action against defendant General Motors LLC (“Defendant”) asserting three causes of action under the Song-Beverly Act (“SBA”) and one cause of action for fraudulent inducement. Plaintiff alleges that he purchased a 2019 Chevrolet Silverado on August 8, 2019, which had a defective transmission. (Compl., ¶ 4.)

On March 6, 2023, Defendant filed this demurrer and motion to strike. Defendant argues that Plaintiff’s fraud claim is barred by the statute of limitations, fails to state facts relevant to the elements of the claim, and fails to allege a transactional relationship giving rise to a duty to disclose. Defendant also moves to strike Plaintiff’s demand for punitive damages.

Plaintiff filed opposition briefs on April 4, 2023. As of April 11, 2023, Defendant has not filed reply briefs (although Defendant filed a Notice of Plaintiff’s Non-Opposition and asks the Court to deem it a reply).

A demurrer tests the legal sufficiency of the pleadings and will be sustained only where the pleading is defective on its face. (City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1998) 68 Cal.App.4th 445, 459.) “We treat the demurrer as admitting all material facts properly pleaded but not contentions, deductions or conclusions of fact or law. We accept the factual allegations of the complaint as true and also consider matters which may be judicially noticed. [Citation.]” (Mitchell v. California Department of Public Health (2016) 1 Cal.App.5th 1000, 1007; Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604 [“the facts alleged in the pleading are deemed to be true, however improbable they may be”].) Allegations are to be liberally construed. (Code Civ. Proc., § 452.) A demurrer may be brought if insufficient facts are stated to support the cause of action asserted. (Code Civ. Proc., § 430.10, subd. (e).)

Any party, within the time allowed to respond to a pleading may serve and file a notice of motion to strike the whole or any part thereof. (Code Civ. Proc., § 435, subd. (b)(1).) The court may, upon a motion, or at any time in its discretion, and upon terms it deems proper, strike any irrelevant, false, or improper matter inserted in any pleading. (Code Civ. Proc., § 436, subd. (a); Stafford v. Shultz (1954) 42 Cal.2d 767, 782 [“Matter in a pleading which is not essential to the claim is surplusage; probative facts are surplusage and may be stricken out or disregarded”].) The court may also strike all or any part of any pleading not drawn or filed in conformity with California law, a court rule, or an order of the court. (Code Civ. Proc., § 436, subd. (b).) An immaterial or irrelevant allegation is one that is not essential to the statement of a claim or defense; is neither pertinent to nor supported by an otherwise sufficient claim or defense; or a demand for judgment requesting relief not supported by the allegations of the complaint. (Code Civ. Proc., § 431.10, subd. (b).) The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. (Code Civ. Proc., § 437.)

Leave to amend must be allowed where there is a reasonable possibility of successful amendment. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 348.) The burden is on the complainant to show the Court that a pleading can be amended successfully. (Ibid.)

Before filing a demurrer or motion to strike, the demurring or moving party shall meet and confer with the party who has filed the pleading and shall file a declaration detailing their meet and confer efforts. (Code Civ. Proc., §§ 430.41, subd. (a); 435.5, subd. (a).)

Plaintiff’s counsel, Harry H. Terzian, declares that defense counsel failed to contact his office or provide the legal reasoning for the demurrer and motion to strike. (Terzian Decl., ¶ 4.) A determination by the court that the meet and confer process was insufficient shall not be grounds to overrule or sustain a demurrer or grant or deny the motion to strike. (Code Civ. Proc., §§ 430.41, subd. (a)(4); 435.5, subd. (a)(4).) As Plaintiff opposes the merits of Defendant’s demurrer and motion to strike, the Court proceeds to analyze the merits of the filings.

Defendant argues that Plaintiff’s fraud claim is barred by the 3-year statute of limitations period set forth in CCP 338(d). Defendant contends that Plaintiff’s claim is barred because the vehicle was purchased on August 8, 2019, and Plaintiff had to file his action no later than August 8, 2022. (Demurrer, 8:1-.) Defendant claims that the delayed discovery rule does not apply because the vehicle was already delivered to Plaintiff with defects and Plaintiff does not plead facts showing that he was “not negligent in failing to make the discovery sooner” or that “he had no actual or presumptive knowledge of facts sufficient to put him on inquiry.” (Demurrer, 8:7-8.)

In opposition, Plaintiff argues that he sufficiently pleads around the statute of limitations by alleging his delayed discovery. Plaintiff alleges that he had no way of knowing of the alleged fraud about the defective transmission until the defect became manifest and Defendant and its representatives were unable to repair the Vehicle after a reasonable number of attempts. Plaintiff also alleges that he first presented the Vehicle for repair on May 2020, and again on July 2022, and was told by the authorized repair facility that the Vehicle had no defects. (Compl., ¶¶ 62-65.) Plaintiff further alleges that he did not discover the defective transmission until shortly before this action was filed and could not have discovered these facts because Defendant concealed the defective nature of the transmission defect. (Compl., ¶¶ 68-71.) This is sufficient, at the pleading stage, to allege that the delayed discovery rule tolled the running of the statute of limitations.

Accordingly, Defendant’s demurrer to the fourth cause of action on this ground is OVERRULED.

Next, Defendant demurs to Plaintiff’s fraud claim on the grounds that Plaintiff fails to plead the cause of action with the requisite specificity. (Demurrer, 8:21-10:6.) This is unpersuasive. The rule of specifically pleading how, when, where, to whom and by what means, misrepresentations were communicated is intended to apply to affirmative misrepresentations and not to concealment. (Alfaro v. Community Housing Improvement System & Planning Assn, Inc. (2009) 171 Cal.App.4th 1356 at 1384.) “The requirement of specificity is relaxed when the allegations indicate that ‘the defendant must necessarily possess full information concerning the facts of the controversy.” (Tarmann v. State Farm (1991) 2 Cal.App.4th 153, 58.) Defendant’s demurrer on this ground is OVERRULED.

Last, Defendant demurs to Plaintiff’s fraud claim on the grounds that Plaintiff failed to allege a transactional relationship giving rise to a duty to disclose. This argument fails. When any claim for fraud is based on an omission, one of the following four circumstances must apply in order to establish the defendant’s duty to disclose information to the plaintiff: (1) the defendant is the plaintiff’s fiduciary; (2) the defendant has exclusive knowledge of material facts not known or reasonably accessible to the plaintiff; (3) the defendant actively conceals a material fact from the plaintiff; and (4) the defendant makes partial representations that are misleading because some other material fact has not been disclosed. (LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 336.)

Defendant relies largely on Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 311 and argues that that Plaintiff cannot allege any actionable concealment because there are no allegations of a direct transaction. In opposition, Plaintiff persuasively argues that no direct transactional relationship is necessary because he alleges safety concerns regarding the Vehicle’s transmission and that these safety-related concerns triggered Defendant’s obligation to disclose. (See Daugherty v. Am. Honda Motor Co. (2006) 144 Cal.App.4th 824, 836.) Plaintiff alleges that the transmission defect is material and presents a safety risk because it affects the driver’s ability to control the car’s speed, acceleration, and deceleration, making it difficult to safely merge into traffic, and drivers have reported sudden lurching into intersections. (Compl., ¶ 32.) The defective transmission can also cause delayed downshifting and deceleration when the brakes are depressed. (Ibid.) This is sufficient to allege the existence of a safety concern giving rise to a duty to disclose.

Defendant moves to strike Plaintiff’s request for punitive damages on the grounds that punitive damages are not recoverable based on the SBA and Plaintiff fails to allege facts to support his fraud claim.

Civil Code section 3294 provides in relevant part that a plaintiff may seek punitive damages “[i]n an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice….” (Civ. Code, § 3294, subd. (a).) “ ‘Fraud’ means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property or legal rights or otherwise causing injury.” (Civ. Code, § 3294, subd. (c)(3).)

To survive a motion to strike a request for punitive damages, “the ultimate facts showing an entitlement to such relief must be pled by a plaintiff.” (Clauson v. Superior Court (1998) 67 Cal.App.4th 1253, 1255; accord, Blegen v. Superior Court (1981) 125 Cal.App.3d 959, 963.) “Pleading in the language of the statute is not objectionable when sufficient facts are alleged to support the allegation.” (Perkins v. Superior Court (1981) 117 Cal.App.3d 1, 6-7.)

Having overruled the demurrer to the fourth cause of action for fraudulent concealment, the Court DENIES the motion to strike.

Parties who intend to submit on this tentative must send an email to the Court at ALHDEPT3@lacourt.org indicating intention to submit on the tentative as directed by the instructions provided on the court website at www.lacourt.org. Please be advised that if you submit on the tentative and elect not to appear at the hearing, the opposing party may nevertheless appear at the hearing and argue the matter. Unless you receive a submission from all other parties in the matter, you should assume that others might appear at the hearing to argue. If the Court does not receive emails from the parties indicating submission on this tentative ruling and there are no appearances at the hearing, the Court may, at its discretion, adopt the tentative as the final order or place the motion off calendar.

William A. Crowfoot

Judge of the Superior Court