tentative rulings for october 3, 2017 departments … rulings for october 3, 2017 departments 402,...

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Tentative Rulings for October 3, 2017

Departments 402, 403, 501, 502, 503

There are no tentative rulings for the following cases. The hearing will go forward on

these matters. If a person is under a court order to appear, he/she must do so.

Otherwise, parties should appear unless they have notified the court that they will

submit the matter without an appearance. (See California Rules of Court, rule 3.1304(c).)

16CECG03213 Callison v. Strang (Dept. 501)

16CECG03443 Wilshusen v. Advance Auto Parts, Inc. (Dept. 501)

14CECG02293 Smith v. Community Regional Medical Centers (Dept. 501)

The court has continued the following cases. The deadlines for opposition and reply

papers will remain the same as for the original hearing date.

16CECG02048 Renfro v. Lopez is continued to Wednesday, October 11, 2017 at

3:30 p.m. in Dept. 502.

________________________________________________________________

(Tentative Rulings begin at the next page)

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Tentative Rulings for Department 402 (2)

Tentative Ruling

Re: Chavez et al. v. Medina et al.

Superior Court Case No. 17CECG02076

Hearing Date: October 3, 2017 (Dept. 402)

Motion: Petitions to Compromise Minors” Claims

Tentative Ruling:

To grant. Orders signed. Hearing off calendar.

Pursuant to California Rules of Court, rule 3.1312 and Code of Civil Procedure

section 1019.5(a), no further written order is necessary. The minute order adopting this

tentative ruling will serve as the order of the court and service by the clerk will constitute

notice of the order.

Tentative Ruling

Issued By: JYH on 10/02/17

(Judge’s initials) (Date)

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(20) Tentative Ruling

Re: Contreras v. Ashria, LLC, Superior Court Case No.

15CECG03848

Hearing Date: November 7, 2017 (Dept. 402)

Motion: (1) Plaintiff’s Motion to Seal Records; (2) Plaintiff’s Motion to

Enforce Settlement Agreement

Tentative Ruling:

To continue the motion to seal records to October 31, 2017, at 3:30 p.m. in

Department 402. Within 10 days of service of the order by the clerk, defendant Ashria,

LLC, shall file a motion to seal.

To continue the motion to enforce the settlement agreement to November 7,

2017, at 3:30 p.m. in Department 402. Nothing further shall be filed in support of this

motion, as it is fully briefed.

Explanation:

Initially, plaintiff should note that no memorandum of points and authorities in

support of the motion to enforce the settlement was e-filed on September 8, 2017.

Instead, two copies of the notice of motion were e-filed. The memorandum should be

e-filed promptly.

The parties orally reached a settlement on August 11, 2017 at the pretrial

settlement conference. The agreement was reduced to writing and executed on

August 14. Plaintiff contends that defendant breached the settlement agreement, and

moves to enforce it under Code of Civil Procedure section 664.6.

Before addressing the motion to enforce the settlement, the motion to seal must

be resolved. The parties agreed in the Settlement Agreement to keep the contents

thereof confidential. Plaintiff moves to seal the Settlement Agreement and any

mention of the terms thereof in the motion to enforce.

“Unless confidentiality is required by law, court records are presumed to be

open.” (Cal. Rules of Court, Rule 2.550(c).) “A record must not be filed under seal

without a court order. The court must not permit a record to be filed under seal based

solely on the agreement or stipulation of the parties.” (Cal. Rules of Court, Rule 2.551,

subd. (a), emphasis added.)

The court must make certain express findings in order to seal records.

Specifically, the court must find that the facts establish:

(1) There exists an overriding interest that overcomes the right of public access to

the record;

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(2) The overriding interest supports sealing the record;

(3) A substantial probability exists that the overriding interest will be prejudiced if

the record is not sealed;

(4) The proposed sealing is narrowly tailored; and

(5) No less restrictive means exist to achieve the overriding interest.

(Cal. Rules of Court, Rule 2.550, subd. (d).)

The sole justifications for the requested sealing order are (1) the fact of the

parties’ confidentiality agreement, and (2) plaintiffs’ concern that disclosing the terms

in the motion to enforce would expose her to a breach of contract claim by

defendant.

However, under Rule of Court 2.551, subdivision (a), “The court must not permit a

record to be filed under seal based solely on the agreement or stipulation of the

parties.” (Cal. Rules of Court, Rule 2.551, subd. (a).) Thus, the mere fact that the parties

agreed to keep the settlement confidential is not enough, by itself, to justify sealing the

portions of the petition and order related to the terms of the settlement.

Plaintiff cites to Universal City Studios, Inc. v. Superior Court (2003) 110

Cal.App.4th 1273 in support of their contention that a contract not to disclose

settlement amounts can constitute an overriding interest for the purposes of Rule of

Court 2.551. However, the court in Universal City went on to state that the mere fact

that the parties contracted to keep the settlement confidential is not enough to justify

sealing the settlement, absent a specific factual showing that the parties would suffer

prejudice if the settlement is disclosed.

Defendant has identified such a potential overriding interest—a binding

contractual agreement not to disclose. The second element of the

overriding interest analysis is there must be a substantial probability that it

will be prejudiced absent closure or sealing. [Citations.] As we will note,

defendant has not shown a substantial probability any such interest in the

present case will be prejudiced—the second element of overriding

interest analysis identified in NBC Subsidiary. This analysis has now been

promulgated by the Judicial Council as one of the findings that must be

returned before a sealing order can be entered. [Citation.].)

(Id. at p. 1283.)

Since the court there found that defendant had not shown that a party’s interest

would be prejudiced if the settlement was disclosed, the court denied the motion to

seal the settlement. (Id. at p. 1287.)

In the present case, the existence of an agreement between the parties not to

disclose the terms of the settlement may constitute an “overriding interest” for the

purposes of Rule 2.551. However, this is not the end of the analysis, and the parties must

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still show through specific facts that revealing the amount of the settlement would

cause actual harm to them. (Id. at p. 1283.)

It is apparent that the confidentiality provision was included at the insistence of

defendant. Plaintiff’s only interest in sealing the records is to not suffer a claim for

breach of contract and damages by defendant for disclosing the settlement. If that

were sufficient to justify a sealing order, then the second prong of the analysis is

subsumed by the first.

Since the confidentiality provision was included in the settlement agreement

apparently solely to benefit defendant, there needs to be a showing that defendant

would be prejudiced by disclosure. No such showing is made here.

The court recognizes the predicament in which plaintiff finds herself. She

apparently has no interest in disclosing the settlement terms, but cannot enforce the

agreement without disclosing the terms thereof. The Judicial Council has adopted a

procedure for just this situation, where a party needs to rely on and submit to the court

documents that the other insists on keeping confidential. Rule 2.551, subdivision (b)(3)

provides:

(3) Procedure for party not intending to file motion or application

(A) A party that files or intends to file with the court, for the purposes of

adjudication or to use at trial, records produced in discovery that are

subject to a confidentiality agreement or protective order, and does not

intend to request to have the records sealed, must:

(i) Lodge the unredacted records subject to the confidentiality

agreement or protective order and any pleadings, memorandums,

declarations, and other documents that disclose the contents of the

records, in the manner stated in (d);

(ii) File copies of the documents in (i) that are redacted so that they do

not disclose the contents of the records that are subject to the

confidentiality agreement or protective order; and

(iii) Give written notice to the party that produced the records that the

records and the other documents lodged under (i) will be placed in the

public court file unless that party files a timely motion or application to

seal the records under this rule.

(B) If the party that produced the documents and was served with the

notice under (A)(iii) fails to file a motion or an application to seal the

records within 10 days or to obtain a court order extending the time to file

such a motion or an application, the clerk must promptly transfer all the

documents in (A)(i) from the envelope, container, or secure electronic file

to the public file. If the party files a motion or an application to seal within

10 days or such later time as the court has ordered, these documents are

to remain conditionally under seal until the court rules on the motion or

application and thereafter are to be filed as ordered by the court.

The court will adopt this procedure for purposes of this motion to seal, albeit

slightly modified.

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While the rule was drafted to address the scenario of use of documents

produced in discovery that the producing party claims is confidential, the rationale for

this procedure applies equally here. Because defendant Ashria is the party that wants

this information concealed from the public, it is the party that should have the burden

of making the required showing for a sealing order.

As the parties have already submitted unredacted copies of their papers

conditionally under seal, the 10 days for defendant to file a motion to seal will run from

service of the minute order on this motion. Since plaintiff was the party initially filing the

motion to seal, the court does not expect any opposition from her to defendant’s

motion seal. Accordingly, the hearing on the motion to seal will be set for October 31,

2017, to give the court time to review defendant’s motion prior to the hearing. If

defendant opts not to file a motion to seal, or the motion to seal is denied, then all

documents lodged conditionally under seal will be placed in the public file. If the

motion to seal is granted, then the court can proceed to rule on the motion to enforce

the settlement agreement by reference to the sealed records. In any case, there will

be no basis for any claim against plaintiff for breach of the confidentiality agreement

because she did her part in maintaining confidentiality.

Pursuant to Cal. Rules of Court, Rule 3.1312(a) and Code Civ. Proc. § 1019.5(a),

no further written order is necessary. The minute order adopting this tentative ruling will

serve as the order of the court and service by the clerk will constitute notice of the

order.

Tentative Ruling



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03

Tentative Ruling

Re: Eggman v. Kullberg

Case No. 15 CE CG 03775

Hearing Date: If a request for oral argument is made in compliance with Local

Rule 2.2.6(B) on today’s date, the court will hear argument on

Thursday October 5, 2017 (Dept. 402)

Motion: Defendant/Cross-Defendant Panu’s Motion for Summary

Judgment on the Complaint and Cross-Complaint

Defendants Tanya and Kelly Hinton’s Motion for Summary

Adjudication

Tentative Ruling:

To grant the motion of defendant Panu for summary judgment as to the

complaint and cross-complaint. (Code Civ. Proc. § 437c.) Plaintiffs’ request for a

continuance of the hearing to obtain more discovery is denied.

To grant the motion for summary adjudication of defendants Tanya and Kelly

Hinton as to the negligent entrustment cause of action. (Ibid.)

Explanation:

Panu’s Motion: Defendant Panu contends that he is immune from liability for

supplying the alcohol that Kullberg drank on the day of the incident, and thus he is

entitled to summary judgment of all claims against him. He contends that Civil Code

section 1714, subdivision (c) and Business and Professions Code section 25602 both

provide him with complete immunity for providing alcohol to Kullberg.

Under Civil Code section 1714, subdivision (c), “Except as provided in subdivision

(d), no social host who furnishes alcoholic beverages to any person may be held legally

accountable for damages suffered by that person, or for injury to the person or

property of, or death of, any third person, resulting from the consumption of those

beverages.” (Civil Code § 1714, subd. (c).)

However, under Civil Code section 1714, subdivision (d)(1), “Nothing in

subdivision (c) shall preclude a claim against a parent, guardian, or another adult who

knowingly furnishes alcoholic beverages at his or her residence to a person whom he or

she knows, or should have known, to be under 21 years of age, in which case,

notwithstanding subdivision (b), the furnishing of the alcoholic beverage may be found

to be the proximate cause of resulting injuries or death.” (Civ. Code, § 1714, subd.

(d)(1), emphasis added.)

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“Section 1714, as presently constituted, was designed to reinstate in California a

common law rule that immunized from civil liability those who provided alcoholic

beverages to someone who then injured himself or a third party due to intoxication.

The theory behind the rule is that the furnishing of alcohol is not the proximate cause of

injuries resulting from intoxication; rather, it is the consumption of alcohol that is the

proximate cause of such injuries.” (Rybicki v. Carlson (2013) 216 Cal.App.4th 758, 762.)

In addition, under Business and Professions Code section 26502, subdivision (b),

“No person who sells, furnishes, gives, or causes to be sold, furnished, or given away,

any alcoholic beverage pursuant to subdivision (a) of this section shall be civilly liable to

any injured person or the estate of such person for injuries inflicted on that person as a

result of intoxication by the consumer of such alcoholic beverage.” (Bus. & Prof. Code

§ 25602, subd. (b).)

Here, Panu has met his burden of showing that he is immune under Civil Code

section 1714, subdivision (c) and Business and Professions Code section 25602,

subdivision (b). While the evidence indicates that Panu furnished alcohol to Kullberg,

and that Kullberg consumed the alcohol and then drove while intoxicated and caused

plaintiffs’ injuries, Panu is immune from civil liability. Civil Code section 1714, subdivision

(c) bars a private person like Panu from being held civilly liable for simply furnishing or

providing alcohol to another person, who then causes injuries to himself or others.

(Rybicki, supra, at p. 764.)

Panu is not a commercial seller of alcohol, and he did not “sell” alcohol to

Kullberg. He merely purchased the alcohol from a liquor store by using the money that

his friends provided to him, and then they shared the alcohol together. Likewise, the

exception to immunity under Civil Code section 1714, subdivision (d) does not apply

here because Panu did not furnish the alcohol at his residence. The alcohol was

obtained at a liquor store, and the parties drank it in their car just before the accident.

However, plaintiffs argue that Panu fits within the exception under Business and

Professions Code section 25602.1, which provides for civil liability for “any other person

who sells, or causes to be sold, any alcoholic beverage, to any obviously intoxicated

minor where the furnishing, sale or giving of that beverage to the minor is the proximate

cause of the personal injury or death sustained by that person.” (Bus. & Prof. Code §

25602.1, Italics added.)

Plaintiffs cite to Ennabe v. Manosa (2014) 58 Cal.4th 697, in which the California

Supreme Court held that a minor who held at a party at her parents’ house and

charged a fee to some of the guests in order to buy more alcohol could be held liable

when one of the guests drove while intoxicated and ran over another guest, killing him.

The Supreme Court relied on the exception to immunity under Business and Professions

Code section 25602.1 in finding civil liability could exist. “[A] private ‘person’ may be

held to have shed her civil immunity if she sold alcoholic beverages (or caused them to

be sold) within the meaning of section 25602.1.” (Id. at p. 713.) Thus, the Supreme

Court found that the defendant had “sold” alcohol for the purposes of section 25602.1

by charging for admission, and that title to the alcohol passed to the driver. (Id. at p.

715.) “Because she sold Garcia alcoholic beverages at her party, section 25602.1

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permits ‘a cause of action [to] be brought [against her] by or on behalf of any person

who has suffered injury or death.’” (Id. at p. 718.)

In the present case, however, Panu did not charge a cover fee or require

Kullberg or the plaintiffs to pay to access alcohol. He did collect money from them for

the purchase of the bottle of vodka at the liquor store, but he did not charge them for

the privilege of drinking, as the defendant did in Ennabe. Thus, he did not “sell” alcohol

to Kullberg within the meaning of section 25602.1.

Also, while plaintiffs contend that Panu “caused alcohol to be sold” to Kullberg

by using his fake ID for the purchase of drinks at Takumi, and later to buy vodka at the

liquor store, again it does not appear that section 25602.1 was intended to cover this

situation. Panu’s actions here are more similar to the actions of the defendants in

Rybicki, supra, who purchased alcohol for a party that was later consumed by the

driver, who then injured the plaintiff. The Rybicki court found that such actions could

not be used to impose civil liability on the defendants, as they were immune under Civil

Code section 1714, subdivision (c), and the exception under subdivision (d) did not

apply. (Id. at p. 764.) While the plaintiffs in Rybicki did not raise the possibility of

immunity under Business and Professions Code section 25602.1, it does not appear that

such immunity would have applied in any event, as there was no evidence that

defendants had charged the driver for the right to consume the alcohol.

Sakanaya also argues in its opposition that Panu “sold” alcohol to Kullberg

because he received consideration for the purchase of the vodka in the form of the

right to drink from the bottle. In Ennabe, the Supreme Court discussed the definition of

“sale” for the purposes of sections 25602 and 25602.1. “Section 23025 defines the terms

‘sell,’ ‘sale,’ and ‘to sell’ as including ‘any transaction whereby, for any consideration,

title to alcoholic beverages is transferred from one person to another.’ (Italics added.)

Because sections 25602 and 25602.1 also appear in the ABC Act, section 23025's

definition of ‘sale’ applies to those sections. We thus agree with the Department of

ABC that the definition of a sale of alcoholic beverages in section 23025 applies to

section 25602.1.” (Id. at p. 714.) Also, “the definition of a sale under section 23025 is

broad enough to encompass indirect sales; the statute requires simply a transfer of title,

not necessarily a transfer of possession of a particular drink.” (Id. at p. 714.)

However, Ennabe also discussed the fact that the Department of ABC does not

regulate the transactions between private parties who pool money together to

purchase alcohol. “The Department of ABC agrees, explaining that ‘situations involving

casual reimbursement among friends who have agreed to purchase alcohol together

rarely, if ever, arise for the Department, and the Department does not make a practice

of intruding into clearly private parties to assess the casual pooling of money among

friends to buy alcohol. On the other hand, circumstances in which alcohol is clearly

being transferred in return for a purchase price, and the only defense to licensure is

either that the alcohol is priced at cost or that a fee is charged for the privilege of

entering [the] premises and consuming alcohol there, present clear cases of sales

requiring a license.’ (Italics added.)” (Id. at p. 720, emphasis in original.)

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Thus, it appears that section 25602.1 was intended to apply to transactions

where there was some kind of “purchase price” and alcohol was exchanged in return

of money or some other form of consideration. Casual situations where friends pool

their money together are not covered, but situations where a person charges for drinks

or charges a fee for entrance to the premises where drinks can be consumed are

covered by the exception to immunity.

In the present case, the parties did not pay Panu for the right to consume

alcohol, and there was no exchange of consideration or transfer of title for the alcohol.

They simply pooled their money so that they could buy alcohol and consume it

together. Under these circumstances, section 25602.1 does not apply, and the general

rule of civil immunity bars the plaintiffs’ claims against Panu. As a result, the court

intends to grant summary judgment in favor of Panu as to plaintiffs’ complaint.

Likewise, the court intends to also grant summary judgment as to the cross-

complaint of Sakanaya against Panu. Sakanaya argues that there are facts suggesting

that there is at least a triable issue of material fact as to whether Kullberg was

“obviously intoxicated” at the time he purchased drinks at Takumi Restaurant. Thus,

Sakanaya argues that summary judgment cannot be granted on the cross-complaint,

as section 25602.1 provides an exception for licensed persons who sell alcohol to minors

who are obviously intoxicated. (Bus. & Prof. Code § 25602.1.) Sakanaya relies on the

fact that Eggman testified at her deposition that Kullberg “looked very intoxicated. His

face was red. His eyes were droopy. He was slurring his words. Again, being very

repetitive. Being very rowdy, very rambunctious. And it only got worse the more he

drank. But he looked red and very drunk.” (Exhibit A to Clark decl., Eggman depo., p.

150, lines 5-21.) Thus, Sakanaya argues that there is a triable issue as to whether the

exception to immunity applies here.

However, while there may be a triable issue of material fact as to whether

section 25602.1 applies to the claims against Sakanaya, since Sakanaya is a licensed

seller of alcohol that allegedly sold alcohol to an obviously intoxicated minor, Panu is

immune from civil liability under Civil Code section 1714, subdivision (c), as discussed

above. Since Panu is not civilly liable to plaintiffs, he cannot be held liable on an

indemnity or contribution theory to Sakanaya either. Again, Panu did not sell or cause

to be sold alcohol for the purposes of section 25602.1. The fact that Sakanaya may be

liable to plaintiffs does not permit it to sue Panu for indemnity where Panu owed no

duty of care toward the plaintiffs due to the application of section 1714. Therefore, the

court intends to grant summary judgment on the cross-complaint as to Panu.1

1 Plaintiffs have also requested that the court continue the hearing date on the summary

judgment motion under Code of Civil Procedure section 437c, subd. (h), contending that they

have pending discovery requests and may be able to obtain additional information that would

defeat summary judgment. However, the court intends to deny the request for a continuance.

Plaintiffs have not shown that they are likely to obtain any new information that would change

the outcome, especially in light of the fact that Panu is immune from civil liability under Civil

Code § 1714, subd. (c). The only evidence that plaintiff seeks to obtain is the testimony of

employees at Takumi and Liquor Junction, but this evidence would not affect the application of

the statutory immunity.

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The Hintons’ Motion: The Hintons also move for summary adjudication of the

negligent entrustment claim alleged against them.

“It has been stated that in order to impose liability for negligent entrustment, the

lending owner must know, or from facts known to him should know, that the entrustee

driver was intoxicated, incompetent, or reckless.” (Hartford Accident & Indemnity Co.

v. Abdullah (1979) 94 Cal.App.3d 81, 91, internal citation omitted.)

Here, the Hintons have provided their own declarations, in which they state that

they had no knowledge that their son, Cameron Kullberg, was unfit or incompetent to

drive. They point out that Kullberg had his driver’s license, that they were not aware of

him receiving any traffic tickets prior to the subject accident and in fact he had not

received any tickets, that they were not aware of him being involved in any other

accidents and he had not been involved in any other accidents, and that they were

not aware of him ever operating a vehicle under the influence of drugs or alcohol and

he had not ever operated a vehicle under the influence of drugs or alcohol.

(Defendants’ UMF’s 1-8.) Thus, they claim that they had no reason to believe that their

son was unfit to drive a car before the subject accident. (UMF No. 9.) Thus, the Hintons

have met their burden of showing that they are entitled to summary adjudication of the

negligent entrustment cause of action, as the evidence presented by them indicates

that they had no advance knowledge or reason to believe that their son would drive

under the influence of alcohol before the accident.

In opposition to the Hintons’ motion, plaintiffs present an extensive amount of

evidence, most of which is irrelevant to the issue of whether the Hintons had knowledge

or reason to suspect prior to the subject accident that their son was not fit to drive a

car. Much of plaintiffs’ evidence relates to the events on the day of the accident, most

of which occurred without the knowledge of the parents of Kullberg, or after the

accident. Such evidence is immaterial to the issue of whether the Hintons knew or

should have known before the accident that their son might be unfit to drive.

Therefore, the court intends to disregard it.

On the other hand, the plaintiffs do submit some evidence that they claim raises

a triable issue of material fact as to whether the Hintons might have known before the

accident that their son had regularly been out drinking and driving with his friends.

Plaintiffs claim that Kullberg regularly went out drinking and that he often came home

late at night, drunk. In fact, according to Eggman, Kullberg would go out drinking with

her and their friends at least two to four times a week before the accident. (Eggman

depo., pp. 44:24 – 45:13.)

Diaz Bravo claims that, “During the approximate 2 to 3 month period before this

collision I had been dating Cameron Kullberg regularly. Every weekend we would be

together with other friends drinking alcohol. We also got together several times during

the week and drank as well depending upon the week. We drank at Hanalei's house,

our friend Jacob's house and in Cameron's car. I had driven with him before the

collision on several occasions where he was driving while intoxicated. Whenever I

offered to drive he always refused.” (Diaz Bravo decl., ¶ 16.)

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“On one occasion after we had been out drinking, Cameron had driven home

and he later confided in me that his mother was awake when he arrived home and she

noticed he was drinking and had been driving as well.” (Diaz Bravo decl., ¶ 17.)

“On another occasion, about two weeks before the collision, while driving under

the influence of alcohol, Cameron was dropping off Kevin at his house. Kevin was

extremely intoxicated and Cameron had to walk him inside his house. Cameron was

also intoxicated and on the way home Cameron continued to drink while driving and

had to pull over to throw up. He hit a stop sign and dented and damaged his vehicle

that was always parked at his house. There was no way to hide it from his parents.” (Id.

at ¶ 18.)

However, the Hintons argue in their opposition that the evidence is largely

speculative and inadmissible, and does not show that the Hintons were aware of

Kullberg’s drinking and driving. They also contend that the statement that Mrs. Hinton

“noticed” he had been drinking and driving is hearsay and thus inadmissible.

It does appear that the statement of Kullberg to Diaz Bravo about his mother’s

“noticing” his drunkenness is hearsay, and not subject to any exceptions to the hearsay

rule. Therefore, the court intends to disregard the statement.

The other events discussed by plaintiffs in their depositions and declarations

occurred out of the presence of the Hintons, as the plaintiffs admit they did their

drinking outside of the Hinton home. The incident where Kullberg allegedly hit a stop

sign and damaged his car while driving drunk also occurred outside the presence of

the Hintons. While it is possible to speculate that they might have noticed the damage

to his car, there is no evidence that they actually did so. Although Kullberg was living at

home and it is certainly possible that the Hintons saw the damage, it is also possible that

they did not see the damage because it was minor or difficult to see when the car was

parked.

As the plaintiffs have not presented any evidence that could allow a reasonable

jury to infer that the Hintons knew or should have known of their son’s unfitness to drive,

the court intends to grant summary adjudication of the negligent entrustment claim in

favor of the Hintons.

Pursuant to CRC 3.1312 and CCP §1019.5(a), no further written order is necessary.

The minute order adopting this tentative ruling will serve as the order of the court and

service by the clerk will constitute notice of the order.

Tentative Ruling



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(5)

Tentative Ruling

Re: Thomas Emerzian v. Wilsonart, LLC et al. et al.

Superior Court Case No. 17 CECG 02495

Hearing Date: If a request for oral argument is made in compliance with

Local Rule 2.2.6(B) on today’s date, the court will hear

argument on Thursday October 5, 2017 (Dept. 402)

Motion: Strike by Defendant Western Building Materials Co.

Tentative Ruling:

To treat the motion to strike as a motion for judgment on the pleadings. To grant

the motion for judgment on the pleadings as to the second and eighth causes of

action with leave to amend. The motion to strike the claims for punitive damages and

the remedies set forth in the eighth cause of action is rendered moot. To strike the third

cause of action sua sponte pursuant to CCP § 436 with leave to amend.

The time in which the complaint can be amended will run from service by the

clerk of the minute order. All new allegations in the first amended complaint are to be

set in boldface type.

Explanation:

Plaintiffs are correct in their argument that a motion to strike generally

does not lie against a defect or objection that may be raised by demurrer. But a

“motion to strike” for failure to state a cause of action (ground for general

demurrer) may be treated by the court as a motion for judgment on the pleadings.

[Pierson v. Sharp Memorial Hosp., Inc. (1989)216 Cal.App.3d 340,342-343] This approach

will be taken here because there is a fundamental flaw in Plaintiff’s fraud based causes

of action.

Second Cause of Action—Fraud via Intentional Misrepresentation and

Third Cause of Action—Fraud via Negligent Misrepresentation

Judicial Council of California Civil Jury Instruction (CACI) No. 1900 Intentional

Misrepresentation states:

[Name of plaintiff] claims that [name of defendant] made a false representation that

harmed [him/her/it]. To establish this claim, [name of plaintiff] must prove all of the

following:

1. That [name of defendant] represented to [name of plaintiff] that a fact was true;

2. That [name of defendant]'s representation was false;

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3. That [name of defendant] knew that the representation was false when [he/she]

made it, or that [he/she] made the representation recklessly and without regard for its

truth;

4. That [name of defendant] intended that [name of plaintiff] rely on the

representation;

5. That [name of plaintiff] reasonably relied on [name of defendant]'s representation;

6. That [name of plaintiff] was harmed; and

7. That [name of plaintiff]'s reliance on [name of defendant]'s representation was a

substantial factor in causing [his/her/its] harm.

CACI No. 1903 “Negligent Misrepresentation” states:

Name of plaintiff] claims [he/she/it] was harmed because [name of defendant]

negligently misrepresented a fact. To establish this claim, [name of plaintiff] must prove

all of the following:

1. That [name of defendant] represented to [name of plaintiff] that a fact was true;

2. That [name of defendant]'s representation was not true;

3. That [although [name of defendant] may have honestly believed that the

representation was true,] [[name of defendant]/he/she] had no reasonable grounds for

believing the representation was true when [he/she] made it;

4. That [name of defendant] intended that [name of plaintiff] rely on this

representation;

5. That [name of plaintiff] reasonably relied on [name of defendant]'s representation;

6. That [name of plaintiff] was harmed; and

7. That [name of plaintiff]'s reliance on [name of defendant]'s representation was a

substantial factor in causing [his/her/its] harm.

Of note, Plaintiffs do not specifically allege who made the representations and

how they were made. Instead they allege: “Defendants represented and advertised

that the Wilsonart® 1730/1 California Compliant Bulk Contact Adhesive that plaintiffs

used was ‘designed with outstanding bond and heat strength,’ that it ‘bonds flatwork

(non-postforming) applications,’ and that Wilsonart contact adhesives are ‘unmatched

in terms of performance’ and “have held together many of America’s foremost

projects since 1970.’” See ¶ 20. Thus, it appears that the representations were made

via advertising.

But, advertising is not made to any plaintiff on a personal basis. Advertising is

made to the public in general. CACI Nos. 1900, 1901 and 1903 require that the

representation be made to a particular person. As a policy consideration, this prevents

a consumer from bringing a common law cause of action for fraud based upon false

advertising. Therefore, the motion for judgment on the pleadings as to the second

cause of action will be granted. The third cause of action for negligent

misrepresentation will be stricken sua sponte pursuant to CCP § 436.

“Representations of opinion, particularly involving matters of value, are ordinarily

not actionable representations of fact. A representation is an opinion ‘“if it expresses

only (a) the belief of the maker, without certainty, as to the existence of a fact; or (b) his

15

judgment as to quality, value … or other matters of judgment.”’” Graham v. Bank of

America, N.A. (2014) 226 Cal.App.4th 594, 606−607.) “Puffing,” or sales talk, is generally

considered opinion, unless it involves a representation of product safety. (Hauter v.

Zogarts (1975) 14 Cal.3d 104, 112.) Leave to amend is granted on the condition that

Plaintiffs must be able to allege that representations of fact not opinion were personally

made and were not in the form of advertising.

In addition, as a matter of law, fraud be pleaded "with particularity" so that the

court can weed out nonmeritorious actions before defendant is required to answer. This

is said to be the "last remaining habitat" of common law pleading standards. See

Committee on Children's Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197,

216. Every element of the cause of action for fraud must be alleged in full, factually and

specifically. The policy of liberal construction of pleading will not be invoked to sustain

a pleading defective in any material respect. See Wilhelm v. Pray, Price, Williams &

Russell (1986) 186 Cal.App.3d 1324, 1332.

The particularity requirement necessitates pleading facts that "show how, when,

where, to whom, and by what means the representations were tendered." See Lazar v.

Sup.Ct. (Rykoff-Sexton, Inc.) (1996) 12 Cal.4th 631, 645 and Stansfield v. Starkey (1990)

220 Cal.App.3d 59, 73. Plaintiff must also specially plead the "detriment proximately

caused" by defendant's tortious conduct. See Civil Code § 3333. ''In order to recover

for fraud, as in any other tort, the plaintiff must plead and prove the 'detriment

proximately caused' by the defendant's tortious conduct. Deception without resulting

loss is not actionable fraud.'' (Service by Medallion, Inc., (1996) 44 Cal.App.4th 1807 at

p. 1818, internal citations omitted.)

Also, in order to state a cause of action for fraud against a corporation, plaintiff

must allege:

--the names of the persons who made the misrepresentations;

--their authority to speak for the corporation;

--to whom they spoke;

--what they said or wrote; and

--when it was said or written. See Lazar v. Sup.Ct. (Rykoff-Sexton, Inc.) (1996) 12 Cal.4th

631, 645 and Tarmann v. State Farm Mut. Auto. Ins. Co. (1991) 2 Cal.App.4th 153, 157.

Eighth Cause of Action—Unfair Business Practices

“False advertising” is actionable pursuant to Bus. & Prof. Code § 17500.

Importantly, neither actual nor compensatory damages may be awarded in an action

for false advertising. [Bank of the West v. Sup.Ct. (Industrial Indem. Co.) (1992) 2 Cal.4th

1254, 1266—“damages are not available under section 17203”; Chern v. Bank of

America (1976) 15 Cal.3d 866, 875—§§ 17500 and 17535 “do not authorize recovery of

damages”] Punitive damages are not available. [People v. Sup.Ct. (Jayhill Corp.)

(1973) 9 Cal.3d 283, 287]

In the causes of action at bench, Plaintiff seeks both compensatory and punitive

damages. See ¶¶ 65-66 of the Complaint. This is not permitted. Therefore, the motion

https://a.next.westlaw.com/Link/Document/FullText?findType=L&pubNum=1000199&cite=CABPS17203&originatingDoc=Iec11d88e90bc11e28578f7ccc38dcbee&refType=LQ&originationContext=document&transitionType=DocumentItem&contextData=(sc.Document)



16

for judgment on the pleadings will granted as to the eighth causes of action with leave

to amend.

Pursuant to California Rules of Court, Rule 3.1312, subd. (a) and Code of Civil

Procedure section 1019.5, subd. (a), no further written order is necessary. The minute

order adopting this tentative ruling will serve as the order of the court and service by

the clerk will constitute notice of the order.

Tentative Ruling



17


Re: Arteaga v. Fresno Community

Court Case No. 13CECG03906


Motion: Motion by Pervaiz A. Chaudhry, Valley Cardiac Surgery Medical

Group, and Chaudhry Medical, Inc. for Judgment on the Pleadings

on the Tenth Cause of Action to the Fourth Amended Complaint

Tentative Ruling:

To order off calendar as moot, given plaintiffs’ dismissal of the Tenth cause of

action. (Wells v. Marina City Properties, Inc. (1981) 29 Cal.3d 781, 789-790.)

Explanation:



ruling will serve as the order of the court, and service by the clerk of the minute order

will constitute notice of the order.

Tentative Ruling



18

Tentative Rulings for Department 403


Re: Bella-Gala, Inc. v. Alvarez et al., Superior Court Case No.

16CECG00511


Motion: Plaintiff’s Motion to Vacate and Set Aside Entry of Default

and to Amend Complaint

Tentative Ruling:

To grant. Plaintiff may file the proposed amended complaint, which will have

the effect of vacating the default of defendant Andy Alvarez

IF ORAL ARGUMENT IS REQUESTED, IT WILL BE ENTERTAINED ON THURSDAY, OCTOBER 5,

2017 AT 3:00 PM.

Explanation:

It was not necessary for plaintiff to file this motion. Plaintiff has the right to amend

the complaint once without leave of court before a defendant’s answer or demurrer is

filed. (Code Civ. Proc. § 472; Woo v. Superior Court (1999) 75 Cal.App.4th 169, 175.)

The fact that a default has been entered does not affect this right – if a defendant's

default has already been entered, service of the amended complaint “opens” the

default—entitling it to plead to the amended complaint. (Weil & Brown, Cal. Practice

Guide: Civ. Proc. Before Trial (TRG 2017) ¶ 6:609; Engebretson & Co., Inc. v. Harrison

(1981) 125 Cal.App.3d 436, 442-443.) Plaintiff should have just gone ahead and filed the

amended complaint, which would have had the effect of setting aside the default.

Pursuant to Cal. Rules of Court, Rule 3.1312(a) and Code Civ. Proc. § 1019.5(a),

no further written order is necessary. The minute order adopting this tentative ruling will

serve as the order of the court and service by the clerk will constitute notice of the

order.

Tentative Ruling

Issued By: KCK on 10/02/17


19

(5)

Tentative Ruling

Re: Karen Johnson v. Zenique Development, LLC et al.

Superior Court Case No. 16 CECG 03831


Motion: Demurrer to the First Amended Complaint

Tentative Ruling:

To take the demurrer off calendar for failure to comply with CCP § 430.41(a). It

states in relevant part: “Before filing a demurrer pursuant to this chapter, the demurring

party shall meet and confer in person or by telephone with the party who filed the

pleading that is subject to demurrer...” Here, there was no declaration submitted by

the Defendants regarding this requirement.

The parties are ordered to meet & confer as required by CCP § 430.41(a). If the

meet & confer is unsuccessful, then the demurring party may calendar a new date for

hearing the demurrer to the First Amended complaint.


2017 AT 3:00 PM.

Pursuant to California Rules of Court, Rule 391(a) and Code of Civil Procedure §

1019.5, subd. (a), no further written order is necessary. The minute order adopting this



Tentative Ruling



20

(30)

Tentative Ruling

Re: Bryan Moon v. Sina Vong


Hearing Date: Tuesday October 3, 2017 (Dept. 403)

Motion: Petition to Compromise a Minor’s Claim

Tentative Ruling:

TO GRANT provided that Minor’s mother, Alma Ruiz Pranger is present at the hearing on

October 5, 2017 and testifies regarding the current status of Minor’s anxiety.


2017 AT 3:00 PM.

Explanation:

Paragraph 9 (a) of the Petition indicates Minor is fully recovered, but medical records

do not fully substantiate this claim. (Amend. Pet., Attach 9.)

Regarding anxiety: Minor was treated for anxiety (Pet. filed: 6/12/17, ¶ 8), but no

medical records are submitted indicating that Minor has fully recovered from this

condition. In Attorney Torem’s July 26 letter, he states that he has been unable to have

Minor evaluated on this basis, but states that he is fully recovered. He agrees to

produce Minor’s mother, Alma Ruiz Pranger at the hearing to testify as to Minor’s

current status.

Pursuant to California Rules of Court, rule 3.1312(a) and Code of Civil Procedure

section 1019.5, subdivision (a), no further written order is necessary. The minute order

adopting this tentative ruling will serve as the order of the court and service by the clerk


Tentative Ruling



21

Tentative Rulings for Department 501

(29)

Tentative Ruling

Re: Samira Lyahyaoui v. Khalid Chaoui, et al.



Motion: Set aside default

Tentative Ruling:

To deny. (Calif. Rules of Court, rule 3.1113(a).)

Explanation:

“Unless otherwise provided by the rules in this division, the papers filed in support

of a motion must consist of at least the following:

(1) a notice of hearing on the motion;

(2) the motion itself; and

(3) a memorandum in support of the motion[.]”

(Calif. Rules of Court, rule 3.1112(a).)

The court may construe the absence of a memorandum as an admission that

the motion is not meritorious and cause for its denial. (Calif. Rules of Court, rule

3.1113(a).)

In the case at bench, the Court found no moving papers in support of the instant

motion. Accordingly, the motion is denied.

Pursuant to California Rules of Court, rule 3.1312(a), and Code of Civil Procedure




Tentative Ruling

Issued By: MWS on 10/02/17


22

(30)

Tentative Ruling

Re: Joey Smith v. Community Regional Medical Center

Superior Court No. 14CECG02293

Hearing Date: Tuesday October 3, 2017 (Dept. 501)

Motions: Plaintiffs’ Motion for Reconsideration of This Court’s Order (dated

8/11/17), granting Defendant Johnson, Kapoor, and Regent’s

Motion for Summary Judgment

Tentative Ruling:

To Order Off Calendar

Explanation:

Either party may seek reconsideration by the same judge within 10 days upon showing

“new or different facts, circumstances or law.” (Code Civ. Proc., § 1008, subd. (a).) But,

the motion must be made and decided before entry of judgment. (Aguilar v. Atlantic

Richfield Co. (2001) 25 Cal.4th 826, n.29; Passavanti v. Williams (1990) 225 Cal.App.3d

1602, 1606; see also APRI Ins. Co. v. Superior Court (1999) 76 Cal.App.4th 176, 181

[immaterial that motion filed before entry of judgment]; Ramon v. Aerospace Corp.

(1996) 50 Cal.App.4th 1233, 1237–1238.)

Here, Plaintiffs seek reconsideration of the order issued on August 11, 2017. However,

because judgment was entered on August 18, 2017, This Court has no further power to

rule. And it is irrelevant that this motion was filed prior to entry of judgment.





Tentative Ruling

Issued By: ____ on .


23


Tentative Ruling

Re: In re Yaritzell Gaxiola



Motion: Petition to Compromise Minor’s Claim

Tentative Ruling:

To grant. Order signed. Hearing off calendar.





Tentative Ruling

Issued By: RTM on 09/22/17


24


Tentative Ruling

Re: Martinez v. Packard

Superior Court Case No.: 16CECG02429


Motion: Default prove-up

Tentative Ruling:

To deny, without prejudice, pending correction of the items noted below.

Any new hearing date must be obtained pursuant to The Superior Court of

Fresno County, Local Rules, rule 2.2.1.

Explanation:

Because Plaintiff is not seeking a judgment against Ameaca Packard and the

Doe Defendants, they must be dismissed from the case. (Cal. Rules of Court, rule

3.1800(a)(7).)

Because the statement of damages included just $1 million for the amount of

special damages/medical expenses, this element of the judgment will be limited to that

amount, not the entire $1,079,982.26 in medical bills attached to Plaintiff’s declaration.

(Code Civ. Proc., §§ 580, subd. (a); 425.11.) Should Plaintiff not wish to accept the $1

million for past medical expenses, default can be stricken, and Plaintiff must personally

serve on Defendant John Packard an amended statement of damages seeking

$1,079,982.26, before default is entered again and the process continue from there.

The Court is satisfied with the proof of the special damages/medical bills. Plaintiff

need only establish a prima facie case for damages; its evidence need not

preponderate because, by defaulting, the defendant admits the material allegations

of the complaint. (Johnson v. Stanhiser (1999) 72 Cal.App.4th 357, 361.)

While a personal injury plaintiff may obtain, on default, an award of future

medical expenses (present value), such evidence is going to require expert testimony

and calculation. (Niles v. City of San Rafael (1974) 42 Cal.App.3d 230, 243 [Future

medical expenses are a subject sufficiently beyond common knowledge that the

opinion of an expert would assist the trier of fact, with the testimony by actuaries

frequently used to show discount rates and the present value of future benefits.]) This

would include the probability and type of such future medical expenses, requiring

medical expert testimony, as well as the actuarial information about the expense.

25

Plaintiff may either re-submit this, or delete the future medical expenses from his request

for default judgment.

While there is no requirement that loss of future earning capacity be proved by

expert testimony, with Plaintiff’s own testimony concerning his or her occupational goals

and opportunities and the effect of his or her injury thereon being sufficient evidence of

such damages (Gargir v. B’nei Akiva (1998) 66 Cal.App.4th 1269, 1280-1282), the Court

would need to know Plaintiff’s age to know if his claimed $500,000 in loss of future

earnings capacity (present value) is reasonable. (See Judicial Council of Cal. Civ. Jury

Instns (Feb. 2007 rev.) CACI No. 3932 [Life expectancy tables].)





Tentative Ruling

Issued by: A.M. Simpson on 10/02/17


26


Re: Avila v. Sierra Pacific Mortgage Company, Inc.

Court Case No. 17CECG00459


Motion: 1) JPMorgan Chase Bank, N.A.’s Demurrer to the Third Amended

Complaint

2) JPMorgan Chase Bank, N.A.’s Motion to Strike Portions of Third

Amended Complaint

3) Demurrer of CitiMortgage, Inc. and Mortgage Electronic

Registration System to the Third Amended Complaint

Tentative Ruling:

To strike, sua sponte, the First and Fourth causes of action from the complaint as

they were improperly inserted in the pleading. (Code Civ. Proc. § 436.) This order is

expressly made applicable to all defendants. No leave to amend is granted, as this can

only be obtained via a duly noticed motion.

To sustain the demurrers of JPMorgan Chase Bank, N.A., CitiMortgage, Inc. and

Mortgage Electronic Registration System to the Second, Third, Fifth, Sixth, Seventh, and

Eighth causes of action, without leave to amend.

Explanation:

Chase’s Motion to Strike:

JPMorgan Chase Bank, N.A. (“Chase”) moves to strike the two causes of action

which were inserted in the Third Amended Complaint (“TAC”) without leave of court:

the First cause of action for violations of the HBOR and the Fourth cause of action for

violations of the TILA. Plaintiff’s authority to amend was limited in scope to those causes

of action alleged in the complaint. (People By and Through Dept. of Public Works v.

Clausen (1967) 248 Cal.App.2d 770, 785.) He had no leave of court to raise new causes

of action.

While only Chase moved to strike these causes of action, and CitiMortgage, Inc.

(“CMI”) and Mortgage Electronic Registration System (“MERS”) raised this issue by way

of demurrer, the order striking these causes of action must apply to all defendants.

Therefore, the court has stricken them from the complaint, sua sponte, so the order will

be applicable to all defendants. (Code Civ. Proc. § 436.)

Chase’s Demurrer to Entire Complaint (Judicial Estoppel):

Judicial estoppel is an equitable doctrine designed to preclude a party from

asserting one position and gaining an advantage thereby, and then later taking a

clearly inconsistent position. (Hamilton v. State Farm Fire & Cas. Co. (9th Cir. 2001) 270

27

F.3d 778, 782 (“Hamilton/State Farm”).) Specific to the context here, the doctrine

prevents a bankruptcy debtor who fails to disclose a lender liability claim (whether filed

yet or not), as is required to be listed in the bankruptcy petition, from later litigating that

claim. “The result of a failure to disclose [any litigation likely to arise in a nonbankruptcy

context] triggers application of the doctrine of equitable estoppel, operating against a

subsequent attempt to prosecute the actions.”(Hamilton v. Greenwich Investors XXVI,

LLC (2011) 195 Cal.App.4th 1602, 1609 (“Hamilton/Greenwich”) (Citation and internal

quotes omitted; brackets in the original).)

Chase argues that here the judicially noticed documents show that plaintiff’s

seventh bankruptcy petition was filed on January 19, 2016, so it occurred after all of the

pertinent documents relative to the foreclosure were recorded. Accordingly, he then

knew all facts necessary to allow him to be aware of any claims he had against Chase,

and indeed against all the defendants. However, he never disclosed the existence of

any claims or litigation against Chase or any other defendant when he filed the

schedules detailing his assets. (See RJN, Ex. 22, Bates No. 122.) Defendant is not asking

that the court accept the truth of the matter (i.e., that plaintiff had no claims against

anyone), but that the petition “says what it says,” i.e., that this was the position plaintiff

took in the bankruptcy action. Thus, Chase argues plaintiff should be judicially

estopped from asserting any such claims now.

In “Hamilton/Greenwich,” supra, the Second District Court of Appeal expressly

held that when ruling on a demurrer to a borrower’s fraud action against a lender there

was no error in the trial court taking judicial notice of the bankruptcy documents where

1) all documents could be verified by using the bankruptcy court’s electronic file

system, 2) plaintiff did not dispute that the documents were what they purported to be,

and 3) the judicial notice was not being requested for the truth of the matters asserted,

but rather to determine that the documents were filed and that “they say what they

say.” (Hamilton/Greenwich, supra, 195 Cal.App.4th at p. 1609, fn 3.) Here, all of these

apply, so the court has taken judicial notice of the bankruptcy documents to determine

whether the doctrine of judicial estoppel should apply to bar plaintiff’s claims.

Demurrer cannot be sustained based on the doctrine of judicial estoppel. First, in

discussing the factors where the doctrine could be applied, the court in

Hamilton/Greenwich clearly recognized that it could not be asserted by a defendant in

the lawsuit who was not also a party to the bankruptcy proceeding, since application

of judicial estoppel “in the absence of any basis for a res judicata finding [such as]

where the later lawsuit is against a noncreditor” would penalize both sides to the

bankruptcy while “bestowing a windfall upon the third party noncreditor defendant.”

(Hamilton/Greenwich, 195 Cal.App.4th at pp. 1612-1613 (brackets added), citing to

and quoting Cloud v. Northrop Grumman Corp. (1998) 67 Cal.App.4th 995, 1020.) Here,

Chase was not listed as a bankruptcy creditor on the petition and thus it stands as a

third party noncreditor defendant, so there is no basis for application of judicial

estoppel in its favor. At best, the doctrine might be asserted in favor of defendant CMI,

who was named as a creditor in the bankruptcy.

However, judicial estoppel cannot be applied on this motion for a second

reason (i.e., even if Chase had been a bankruptcy creditor): Chase failed to establish

28

that plaintiff’s seventh bankruptcy petition was on the proper footing for application of

the doctrine. Judicial estoppel will only be applied where the bankruptcy court has

confirmed a plan of reorganization, thereby establishing that the bankruptcy court

adopted or accepted the truth of the debtor’s position that he did not have any legal

claims. The court in Hamilton/Greenwich recognized this principal as set forth in Gottlieb

v. Kest (2006) 141 Cal.App.4th 110, and summarized the point as follows: “[W]hen the

bankruptcy court dismisses a case without confirming a plan of reorganization, judicial

estoppel does not bar a claim that should have been disclosed in bankruptcy, because

nothing that happened in the bankruptcy court affected any unpaid creditor's right to

pursue the debtor.” (Hamilton/Greenwich, supra, 195 Cal.App.4th at 1610 (and

discussing Gottlieb further at p. 1613).) The Ninth Circuit has recognized this same

limitation: “This court has restricted the application of judicial estoppel to cases where

the court relied on, or ‘accepted,’ the party's previous inconsistent position.” (See

Hamilton/State Farm, supra, 270 F.3d at p. 783.) Here, Chase requested judicial notice

of plaintiff’s bankruptcy petition, only. There is no indication that the court ever

confirmed a plan of reorganization for plaintiff, or if the case was dismissed just as the

other ones were. The court cannot find that the doctrine should apply here, even to a

named creditor.

Demurrers to Remaining Counts:

The court will combine the discussion of the demurrers by each set of

defendants, as the rulings and bases for each are the same.

First (Homeowner’s Bill of Rights) and Fourth (Truth in Lending) Causes of Action:

As these causes of action have been dealt with by way of being stricken from

the complaint, the demurrers are rendered moot.

Second Cause of Action: Fraud in the Concealment

In the earlier versions of the complaint, the Fraud in the Concealment cause of

action was stated only against defendant Sierra Pacific Mortgage Company, Inc.

(“Sierra Pacific”). In the TAC plaintiff has dropped the designation indicating who this

count is raised against. Since the prior demurrer by CMI and MERS was not raised

against this cause of action, the court’s ruling did not concern it, so plaintiff had no

permission to amend it in any way and thus had no right to add any other defendant to

this cause of action; nor did plaintiff request it by way of a motion to amend. (Phoenix

of Hartford Ins. Companies v. Colony Kitchens (1976) 57 Cal.App.3d 140, 147—new

party may not be added to cause of action by an amended complaint with leave of

court.) Thus, to the extent plaintiff intended this cause of action in the TAC to be raised

against any of the demurring defendants, both demurrers are sustained without leave

to amend absent this being requested and obtained via a duly noticed motion.

Third Cause of Action: Wrongful Foreclosure

This cause of action is premised on challenging defendants’ authority to

foreclose on the property because they “have failed to perfect any security interest” in

29

the property, or they “cannot prove to the court they have a valid interest” in the Deed

of Trust. (TAC, ¶79.) Further, plaintiff challenges MERS’ authority to foreclose. (See TAC, ¶

82.) He claims there is no authority to foreclose because the loan was improperly

securitized due to a violation of the pooling and servicing agreement (“PSA”) for the

securitized trust into which the Note and Deed of Trust was assigned. (TAC, ¶¶27-28.)

As to MERS’ authority to foreclose, this is clearly granted in the Deed of Trust at

issue here. It states that MERS, as nominee for the Lender, had “the right to foreclose

and sell the Property; and to take any action required of Lender including, but not

limited to, releasing and canceling this Security Instrument.” (RJN, Ex. 1, p. 2, Bates

Stamp 7.)

Furthermore, California law does not require a beneficiary or a foreclosing entity

to prove ownership of the Note, or record an assignment prior to commencing

foreclosure and plaintiff cannot demand such proof as a condition to the sale. (Gomes

v. Countrywide Home Loans, Inc. (2011) 192 Cal.App.4th 1149, 1156—“California's

nonjudicial foreclosure law does not provide for the filing of a lawsuit to determine

whether MERS has been authorized by the holder of the Note to initiate a foreclosure.”

Debrunner v. Deutsche Bank Nat. Trust Co. (2012) 204 Cal.App.4th 433, 440—Nonjudicial

foreclosure statute “does not mandate physical possession of the underlying promissory

note in order for this initiation of foreclosure to be valid.”)

Courts have found that borrowers facing nonjudicial foreclosure lack standing to

bring preemptive actions to challenge a foreclosing entity’s authority based on alleged

improper securitization. “California courts do not allow such preemptive suits because

they “would result in the impermissible interjection of the courts into a nonjudicial

scheme enacted by the California Legislature.” (Saterbak v. JPMorgan Chase Bank,

N.A. (2016) 245 Cal.App.4th 808, 814 (internal quotes and citation omitted).) The

California Supreme Court recently held, in Yvanova v. New Century Mortg. Corp. (2016)

62 Cal.4th 919, 934-935, that a borrower had standing to sue for wrongful foreclosure

where the alleged defect in securitization rendered the assignment void rather than

voidable, but the Court expressly limited its ruling to the post-foreclosure context. It

clearly recognized there was no right to bring such a suit pre-foreclosure: “We do not

hold or suggest that a borrower may attempt to preempt a threatened nonjudicial

foreclosure by a suit questioning the foreclosing party's right to proceed.” (Id. at p. 924.)

Furthermore, while the Supreme Court in Yvanova left unresolved the question of

whether an untimely assignment to a securitized trust rendered the transfer void or

merely voidable, the court in Saterbak, relying on a case out of the Second Circuit,

expressly resolved the question: “We conclude such an assignment is merely voidable.”

(Saterbak, supra at p. 815, relying on Rajamin v. Deutsche Bank Nat. Trust Co. (2d Cir.

2014) 757 F.3d 79, 88-89.) Thus, the securitization issue is something only parties to that

transaction can challenge, and not a third-party borrower such as plaintiff.

After amending the complaint several times, plaintiff has failed to show he has

any basis for maintaining this claim. Both demurrers must be sustained, without leave to

amend.

30

Fifth Cause of Action: Unconscionable Contract

This cause of action was also initially only stated against defendant Sierra Pacific,

and no leave was granted in ruling on the prior demurrer for plaintiff to raise it against

any other defendant. Furthermore, it is not a valid cause of action: it is a defense to

enforcement of a contract, permitting the court to deny enforcement of

unconscionable provisions. (Civ. Code § 1670.5; Dean Witter Reynolds, Inc. v. Superior

Court (1989) 211 Cal.App.3d 758, 766; Jones v. Wells Fargo Bank (2003) 112 Cal.App.4th

1527, 1539.) Thus, to the extent plaintiff intended this cause of action in the TAC to be

raised against any defendant other than Sierra Pacific, both demurrers must be

sustained, and without leave to amend because it is not a valid cause of action.

Sixth Cause of Action: Breach of Contract

The text of this cause of action is unchanged from the prior version except for an

added sentence alleging defendants’ knowing breach and plaintiff’s damage (¶ 125).

The “breach” alleged is that Sierra Pacific “and specifically MERS” were obligated

under “paragraph 23 – Release” of the Deed of Trust to reconvey the Deed of Trust to

plaintiff once Sierra Pacific “sold and relinquished its interested in Plaintiff’s real

property,” i.e., in a third party sale. (See TAC, ¶¶ 122-124.)

As none of the allegations of this cause of action are directed to any of the

moving defendants, at best it is subject to a demurrer for uncertainty. However, no

leave to amend can be granted to clarify this uncertainty, since this count is also

subject to general demurrer since it is deficient as a matter of law and the defects have

not been cured despite plaintiff being given an opportunity to amend.

Generally, a plaintiff’s interpretation of a contract will be accepted as correct in

testing the sufficiency of a complaint, but only if the pleaded meaning is one to which

the instrument is reasonably susceptible. (Aragon-Haas v. Family Security Ins. Services,

Inc. (1991) 231 Cal.App.3d 232, 239; Marina Tenants Assn. v. Deauville Marina

Development Co. (1986) 181 Cal.App.3d 122, 128—pleaded meaning accepted as

long as it “does not place a clearly erroneous construction upon the provisions of the

contract.”) Here, plaintiff’s allegations of breach place a clearly erroneous construction

upon the provisions of the Deed of Trust which cannot be accepted as true on

demurrer: namely, plaintiff contends that because Sierra Pacific sold the Note and

Deed of Trust to another creditor he should have been released from any obligation

under either instrument and own the home free and clear of any debt, and defendants

breached the trust by not reconveying the Deed of Trust to him.

Not surprisingly, the Deed of Trust at issue has no such terms. First, the reference

to “paragraph 23” is erroneous, as this deals with riders to the instrument, and not

“releases.” Instead, paragraph 19 deals with “reconveyance,” and it merely provides

that the Lender (and/or its successors and assigns, see ¶12) must reconvey the Deed of

Trust to the person(s) “legally entitled to it” upon payment of all sums secured under it.

Since even after a sale/transfer of the Note and Deed of Trust plaintiff remained

obligated to the Lender and the Lender’s successors and assigns to pay all sums due,

and he acknowledges he is in default on the debt, he cannot allege he has paid all

31

sums due under the Note and is “legal entitled to” reconveyance, much less can he

claim breach for any defendant’s failure to reconvey.

Moreover, plaintiff has failed to add any allegations that might avoid the claim

being barred by the 4-year statute of limitations, as was noted in the prior ruling on

demurrer. Both demurrers must be sustained, without leave to amend.

Seventh Cause of Action: Breach of Fiduciary Duty

The ruling on the earlier demurrer found that plaintiff had failed to allege any

special relationship between the parties which created any fiduciary duty, and pointed

out that absent special circumstances, there is no such relationship between a

borrower and a lender. (Perlas v. GMAC Mortg., LLC (2010) 187 Cal.App.4th 429, 436.)

The only allegation plaintiff has added to the TAC is that Sierra Pacific “owed a duty to

Plaintiff to act in its best interest.” This fails to allege the requisite fiduciary relationship,

but pertinent to the motions at issue, fails to address any such relationship regarding

any of the moving defendants. Both demurrers must be sustained, without leave to

amend.

Eighth Cause of Action: Quiet Title

The earlier demurrer to this cause of action was sustained because, among other

things, plaintiff had not alleged he had rightful title to the property. Plaintiff has

attempted to cure this defect by alleging (and attaching an exhibit showing) that he

regained record title to the property by a Grant Deed from Michelle Avila to him earlier

this year. However, this is insufficient to aid him in maintaining a quiet title cause of

action. The allegation that plaintiff is the rightful owner of the property means he must

plead that he has satisfied his obligation on the debt. (Kelley v. Mortgage Electronic

Registration Systems, Inc. (N.D. Cal. 2009) 642 F.Supp.2d 1048, 1057—“A basic

requirement of an action to quiet title is an allegation that plaintiffs "are the rightful

owners of the property, i.e., that they have satisfied their obligations under the Deed of

Trust" (emphasis added). Shimpones v. Stickney (1934) 219 Cal. 637, 649—“It is “settled in

California that a mortgagor cannot quiet his title against the mortgagee without paying

the debt secured.”) “It is well established in the law that a mortgagor in possession may

not maintain an action to quiet title, even though the debt is unenforceable because

of the statute of limitations.” (Mix v. Sodd (1981) 126 Cal.App.3d 386, 390; Miller v.

Provost (1994) 26 Cal.App.4th 1703, 1707.) Here, there is no question that plaintiff has not

paid the secured debt; therefore, he may not maintain this cause of action. Both

demurrers must be sustained, without leave to amend.



ruling will serve as the order of the court, and service by the clerk of the minute order


Tentative Ruling



32

(29)

Tentative Ruling

Re: Dorothy Adrian, et al. v. Scott Radtke, et al.



Motion: Defendant Keylex, Inc.’s petition to compel arbitration

Tentative Ruling:

To grant Defendant Keylex, Inc.’s petition to compel arbitration of Plaintiffs’

financial elder abuse cause of action. To stay the judicial action pending resolution of

the arbitration.

Explanation:

In Prima Paint Corp. v. Flood & Conklin Mfg. Co. (1967) 388 U.S. 395, 402, the U.S.

Supreme Court specifically and expressly found a distinction between allegations of

fraud directed at the arbitration agreement itself, and allegations of fraud directed at

the principal contract, holding that only fraud directed at the making or performance

of the arbitration agreement is to be determined by the court. (See also Rosenthal v.

Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 415.) Where the fraud goes to

the inception or execution of the agreement, the promisor is deceived as to the nature

of his or her act, and does not actually know what he or she is signing, or does not

intend to enter into a contract at all; in such an instance, mutual assent is lacking, and

the contract is void. (Ibid.) On the other hand, fraud in the inducement occurs where

the party signing knows what he or she is signing, but his or her consent has been

induced by fraud; in that case, mutual assent is present and a contract is formed,

though due to the fraud is voidable. (Rosenthal, supra, 14 Cal.4th at p. 415.) “The

question in all cases simply is whether the agreement to arbitrate itself was induced by

some fraud.” (Hayes Children Leasing Co. v. NCR Corp. (1995) 37 Cal.App.4th 775, 781.)

The issue of fraud in the inducement of a contract containing an arbitration

provision is arbitrable. (Ericksen, Arbuthnot, McCarthy, Kearney & Walsh, Inc. v. 100 Oak

Street (1983) 35 Cal.3d 312.) Accordingly, where a party seeking to resist arbitration

does not allege facts showing that the resisting party never intended to agree to

arbitrate the issues raised, or that its assent to the agreement to arbitrate was the

product of wrongful coercion, “the matter should be referred to the arbitrators without

any preliminary judicial consideration of the question of fraud in the inducement.”

(Hayes, supra, 37 Cal.App.4th at p. 781; see also Engalla v. Permanente Medical Group,

Inc. (1997) 15 Cal.4th 951, 973 [party seeking to defeat petition to compel arbitration on

grounds of fraud must show alleged fraud goes specifically to making of arbitration

agreement, rather than to making of contract in general]; Ericksen, Arbuthnot,

McCarthy, Kearney & Walsh Inc. v. 100 Oak Street (1983) 35 Cal.3d 312, 323 [claims of

fraud in the inducement of contract containing arbitration clause, distinguished from

claims of fraud directed to arbitration clause itself, are to be decided by arbitrator, not

33

the court]; Rosenthal v. Great Western Fin. Securities Corp. (1996) 14 Cal.4th 394, 416

[claims of fraud in the execution of entire agreement not arbitrable under either state

or federal law].)

A party that shows it is a third party beneficiary of an arbitration agreement may

be entitled to enforce that agreement. (Valley Casework, Inc. v. Comfort Construction,

Inc. (1999) 76 Cal.App.4th 1013, 1021; see Mormile v. Sinclair (1994) 21 Cal.App.4th 1508,

1511 [arbitration agreements enforced “with regularity” against nonsignatory parties].)

Where a party attempts to assert an arbitration provision pursuant to third party

beneficiary status, only a “minimal [pleading] requirement” is needed, including an

allegation of a controversy between the parties, facts demonstrating the existence of

an arbitrable controversy, the existence of a written agreement, and an allegation that

the other party has refused to arbitrate. (Bouton v. USAA Cas. Ins. Co. (2008) 167

Cal.App.4th 412, 425.)

When one party to a contract performs pursuant to it and the other party

accepts the performance without objection, the contract is enforceable. (Bohman v.

Berg (1960) 54 Cal.2d 787, 795.)

In the case at bench, Defendant Keylex petitions the Court to compel Plaintiffs to

arbitrate their financial elder abuse claim against moving party pursuant to (1) the

contract between Plaintiffs and Defendant Keylex (“Keylex Agreement”), or (2) the

contract between Plaintiffs and Defendant California Motoring Company Champions,

Inc. (“CAM Agreement”), which Defendant Keylex argues it is entitled to enforce on a

third party basis. Plaintiffs argue that the Keylex Agreement is invalid because Plaintiffs

never signed it; and the CAM Agreement is invalid because only Plaintiffs signed it, the

other party did not.

With regard to the CAM Agreement, though the contract does not appear to be

signed by Defendant California Motoring, the contract became enforceable when it

was accepted through performance, i.e., when Plaintiffs accepted delivery of the

vehicle. As to the Keylex Agreement, Plaintiffs’ argument applies so far as moving party

attempts to enforce the arbitration provision in that agreement; however, moving party

seeks to enforce the arbitration agreement in either contract, seeking to enforce the

arbitration provision of the CAM Agreement pursuant to a third party beneficiary

theory.

Plaintiffs plainly state they executed the CAM Agreement, though they did so in

reliance on misrepresentations made by Defendant Radtke. (Decls. of D. and M.

Adrian, ¶7.) Pursuant to Prima Paint, supra, 388 U.S. 395, and Engalla, supra, 15 Cal.4th

951, Plaintiffs must arbitrate their claims that arise from the CAM Agreement. Claims of

fraudulent inducement to enter an agreement are arbitrable. Plaintiffs do not argue

that they were unable to read the CAM Agreement, or that they were prevented from

doing so; rather, Plaintiffs state they understood that the CAM Agreement was a

formality, and would only be used if Plaintiffs’ check for the vehicle did not clear;

Plaintiffs state they signed the CAM Agreement. In other words, Plaintiffs do not argue

that they did not know they were entering the CAM agreement, that the arbitration

provision was hidden from them, or that any limitations prevented them from learning

34

the contents of the agreement.

Moving party asserts it is a third party beneficiary of the CAM Agreement

pursuant to the contract’s terms. The CAM Agreement specifically states that it is

intended to apply to any claim or dispute arising from or relating to Plaintiffs’ credit

application, purchase or condition of the vehicle, the contract, or any resulting

transactions or relationships, specifically including those with third-party non-signatories.

(See Decls. of D. and M. Adrian, Exh. C, p. 4, §3.) Each of Plaintiffs’ claims relates to the

purchase of the vehicle.

Plaintiffs admit they knowingly entered into the CAM Agreement; there is no

allegation of fraud in the inducement of the contract. The CAM Agreement contains

an arbitration provision that clearly states it extends to third parties where the claim

arises out of or relates to Plaintiffs’ purchase of the vehicle. The allegations against

Defendant Keylex arise from Plaintiffs’ purchase of the vehicle. Accordingly, Defendant

Keylex’s petition to compel arbitration is granted, and the instant action stayed

pending the conclusion of the arbitration proceedings.

Pursuant to California Rules of Court, rule 3.1312, and Code of Civil Procedure




Tentative Ruling



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