This case was last updated from Los Angeles County Superior Courts on 03/24/2023 at 01:06:18 (UTC).

FLAIR CAPITAL MANAGEMENT LLC, A CALIFORNIA LIMITED LIABILITY COMPANY VS ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006

Case Summary

On 10/24/2022 FLAIR CAPITAL MANAGEMENT LLC, A CALIFORNIA LIMITED LIABILITY COMPANY filed a Property - Other Real Property lawsuit against ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006. This case was filed in Los Angeles County Superior Courts, Pasadena Courthouse located in Los Angeles, California. The Judge overseeing this case is MARGARET L. OLDENDORF. The case status is Pending - Other Pending.
Case Details Parties Documents Dockets

 

Case Details

  • Case Number:

    *******0903

  • Filing Date:

    10/24/2022

  • Case Status:

    Pending - Other Pending

  • Case Type:

    Property - Other Real Property

  • County, State:

    Los Angeles, California

Judge Details

Presiding Judge

MARGARET L. OLDENDORF

 

Party Details

Plaintiffs and Cross Defendants

FLAIR CAPITAL MANAGEMENT LLC A CALIFORNIA LIMITED LIABILITY COMPANY

JP MORGAN CHASE BANK N.A.

PACIFIC TELEPHONE AND TELEGRAPH COMPANY

SOUTHERN CALIFORNIA EDISON COMPANY

Cross Plaintiff and Defendant

ALLAN KWOK AND KITTY KWOK AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST

Attorney/Law Firm Details

Plaintiff Attorneys

HSU ROGER C.

SARGSYAN GURGEN

Defendant Attorney

SHACKELFORD JOEL THOMAS

 

Court Documents

Answer - ANSWER (TO CROSS-COMPLAINT)

3/10/2023: Answer - ANSWER (TO CROSS-COMPLAINT)

Notice of Ruling

3/7/2023: Notice of Ruling

Case Management Statement

3/6/2023: Case Management Statement

Order - ORDER OVERRULING CROSS-DEFENDANTS' DEMURRER TO THE CROSS-COMPLAINT

3/6/2023: Order - ORDER OVERRULING CROSS-DEFENDANTS' DEMURRER TO THE CROSS-COMPLAINT

Stipulation and Order - INTERLOCUTORY JUDGMENT BETWEEN CROSS-COMPLAINANTS AND CROSS-DEFENDANT, SOUTHERN CALIFORNIA EDISON COMPANY

3/6/2023: Stipulation and Order - INTERLOCUTORY JUDGMENT BETWEEN CROSS-COMPLAINANTS AND CROSS-DEFENDANT, SOUTHERN CALIFORNIA EDISON COMPANY

Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITHOUT MOTION TO STRIKE)

3/6/2023: Minute Order - MINUTE ORDER (HEARING ON DEMURRER - WITHOUT MOTION TO STRIKE)

Case Management Statement

3/1/2023: Case Management Statement

Request for Dismissal

3/1/2023: Request for Dismissal

Request for Dismissal

3/1/2023: Request for Dismissal

Reply - REPLY REPLY IN SUPPORT OF DEMURRER TO CROSS-COMPLAINT

2/24/2023: Reply - REPLY REPLY IN SUPPORT OF DEMURRER TO CROSS-COMPLAINT

Stipulation and Order - STIPULATION AND ORDER STIPULATION FOR INTERLOCUTORY JUDGMENT BETWEEN CROSS-COMPLAINANTS AND CROSS-DEFENDANT

2/23/2023: Stipulation and Order - STIPULATION AND ORDER STIPULATION FOR INTERLOCUTORY JUDGMENT BETWEEN CROSS-COMPLAINANTS AND CROSS-DEFENDANT

Opposition - OPPOSITION OPPOSITION OF CROSS-COMPLAINANTS, ALLAN KWOK AND KITTY KWOK, TO DEMURRER OF CROSS-DEFENDANT, FLAIR CAPITAL MANAGEMENT, LLC, TO VERIFIED CROSS-COMPLAINT

2/21/2023: Opposition - OPPOSITION OPPOSITION OF CROSS-COMPLAINANTS, ALLAN KWOK AND KITTY KWOK, TO DEMURRER OF CROSS-DEFENDANT, FLAIR CAPITAL MANAGEMENT, LLC, TO VERIFIED CROSS-COMPLAINT

Notice of Lis Pendens

1/23/2023: Notice of Lis Pendens

Proof of Personal Service

1/20/2023: Proof of Personal Service

Proof of Personal Service

1/20/2023: Proof of Personal Service

Proof of Service by Substituted Service

1/12/2023: Proof of Service by Substituted Service

Summons - SUMMONS ON CROSS COMPLAINT

1/10/2023: Summons - SUMMONS ON CROSS COMPLAINT

Answer

1/9/2023: Answer

34 More Documents Available

 

Docket Entries

  • 03/24/2023
  • Hearing03/24/2023 at 08:30 AM in Department P at 300 East Walnut St., Pasadena, CA 91101; Case Management Conference

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  • 03/10/2023
  • DocketAnswer (To Cross-Complaint); Filed by: FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company (Cross-Defendant); As to: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Cross-Complainant)

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  • 03/07/2023
  • DocketNotice of Ruling; Filed by: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Cross-Complainant)

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  • 03/06/2023
  • DocketUpdated -- Demurrer - without Motion to Strike: Filed By: FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company (Cross-Defendant); Result: Overruled ; Result Date: 03/06/2023

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  • 03/06/2023
  • DocketOrder Overruling Cross-Defendants' Demurrer to the Cross-Complaint; Signed and Filed by: Clerk

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  • 03/06/2023
  • DocketInterlocutory Judgment between Cross-Complainants and Cross-Defendant, Southern California Edison Company; Signed and Filed by: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Cross-Complainant); As to: Southern California Edison Company (Cross-Defendant)

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  • 03/06/2023
  • DocketCase Management Statement; Filed by: FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company (Plaintiff)

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  • 03/06/2023
  • DocketMinute Order (Hearing on Demurrer - without Motion to Strike)

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  • 03/06/2023
  • DocketHearing on Demurrer - without Motion to Strike scheduled for 03/06/2023 at 08:30 AM in Pasadena Courthouse at Department P updated: Result Date to 03/06/2023; Result Type to Held

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  • 03/01/2023
  • DocketCase Management Statement; Filed by: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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43 More Docket Entries
  • 10/25/2022
  • DocketOrder to Show Cause Re: Failure to File Proof of Service scheduled for 01/03/2023 at 08:30 AM in Pasadena Courthouse at Department P

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  • 10/24/2022
  • DocketUpdated -- Summons on Complaint: As To Parties changed from ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant) to ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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  • 10/24/2022
  • DocketUpdated -- Civil Case Cover Sheet: As To Parties changed from ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant) to ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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  • 10/24/2022
  • DocketCertificate of Mailing for [Summons on Complaint]; Filed by: Clerk

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  • 10/24/2022
  • DocketUpdated -- Summons on Complaint: As To Parties changed from ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant) to ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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  • 10/24/2022
  • DocketComplaint; Filed by: FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company (Plaintiff); As to: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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  • 10/24/2022
  • DocketSummons on Complaint; Issued and Filed by: FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company (Plaintiff); As to: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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  • 10/24/2022
  • DocketCivil Case Cover Sheet; Filed by: FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company (Plaintiff); As to: ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK JOINT LIVING TRUST DATED JUNE 7, 2006 (Defendant)

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  • 10/24/2022
  • DocketNotice of Case Assignment - Unlimited Civil Case; Filed by: Clerk

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  • 10/24/2022
  • DocketCase assigned to Hon. Margaret L. Oldendorf in Department P Pasadena Courthouse

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Tentative Rulings

Case Number: *******0903 Hearing Date: March 6, 2023 Dept: P

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

NORTHEAST DISTRICT

FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company,

Plaintiff,

vs.

ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK LIVING TRUST DATED JUNE 7 2006; and DOES 1 through 10, inclusive,

Defendants.

And related cross-action.

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Case No.: *******0903

[TENTATIVE] ORDER SUSTAINING IN PART AND OVERRULING IN PART CROSS-DEFENDANTS’ DEMURRER TO THE CROSS-COMPLAINT

Date: March 6, 2023

Time: 8:30 a.m.

Dept.: P

I. INTRODUCTION

This action concerns a boundary dispute between the owners of real properties located in South Pasadena on which multi-unit residential dwellings are located. Defendants Allan and Kitty Kwok (the Kwoks) own real property (held in trust) that allegedly encroaches on property owned by Plaintiff Flair Capital Management, LLC (Flair).

There is a block wall, sometimes called a retaining wall (which seems to indicate that the Kwok property is on a higher elevation than the Flair property), dividing the two properties. On the Kwok side of the boundary is a driveway. The allegation is that the wall encroaches on the Flair property along the entire boundary. The strip of land in dispute (the Encroached Property) is less than three feet wide and amounts to approximately 480 square feet. Based on the allegations and surveys attached to both the verified complaint and verified cross-complaint, the retaining wall is entirely on the Flair property and the wall prevents Flair’s access to the Encroached Property. Flair sued the Kwoks for Trespass, Declaratory Relief, and Quiet Title. The Kwoks responded by demurring to Flair’s complaint, and by filing a cross-complaint. The demurrer to Flair’s complaint was overruled January 3, 2023.

Before the Court is Flair’s demurrer to the Kwok cross-complaint. The cross-complaint alleges claims for Quiet Title, Prescriptive Easement, and Equitable Easement. Based on the facts alleged, the easement claims are sufficiently alleged. Demurrer to the quiet title cause of action is sustained with leave to amend, because the Kwoks have failed to allege a title interest.

II. LEGAL STANDARD

Code Civ. Proc. 430.10(e) provides for a demurrer on the basis that a complaint fails to state a cause of action. A demurrer admits, provisionally for purposes of testing the pleading, all material facts properly pleaded. Tindell v. Murphy (2018) 22 Cal.App.5th 1239, 1247. A demurrer tests the legal sufficiency of a complaint. Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.

III. DISCUSSION

A. Summary of the Kwok Cross-Complaint

The Kwoks allege they are the trustees of the Kwok Family Trust, which owns real property located at 1734 Ellincourt in South Pasadena. They allege they have owned the real property since April 7, 2011. Immediately next door at 1720 Ellincourt is the property owned by Flair. Flair purchased the property in 2017. The Kwoks allege that in 2017 Flair contacted them about the retaining wall that runs between their properties, requesting that they share in the expense of its repair. Also in 2017, Flair informed the Kwoks that a 480- square foot portion of land on the north side of the wall, used by the Kwoks and its predecessor as a driveway (referred to in the Cross-Complaint as “Disputed Property”), was in fact part of the 1720 property.

The Kwoks allege an absolute necessity to use the driveway, and further allege Flair has no use for the land. The alleged reasons for the Kwok’s need to continue using the Disputed Property are set forth in 10: zoning requirements would be violated if the lot line were moved; the recorded power pole easement straddles both properties, which restricts movement of the wall without exorbitant cost; moving the wall would be of little or no benefit to the 1720 property owned by Flair; moving the wall would put the 1734 property’s driveway out of compliance with zoning laws.

The Kwoks allege that several years passed after the 2017 discussions, but in 2021 Flair again made demands about wall repair. The Kwoks allege at that time they had a survey done, copies of which are attached to the cross-complaint. In 12, they allege that they discovered at that time the boundary wall is several feet south of the boundary line and sits entirely on the Flair property. The Kwoks allege they tried several times to resolve the matter with Flair, without success. In 14 the Kwoks allege that they have no responsibility for the boundary and that they have right, title, and/or interest in the Disputed Property.

B. Demurrer to the Quiet Title Cause of Action is Sustained

A claim of title is essential to a quiet title cause of action.

Code Civ. Proc. 760.010 defines “claim” as “a legal or equitable right, title, estate, lien, or interest in property or cloud upon title.”

Section 760.020 (a) provides that, “An action may be brought under this chapter to establish title against adverse claims to real or personal property or any interest therein.”

(Bolding and italics added.)

Section 761.020 provides the elements that must be alleged:

(a) A description of the property that is the subject of the action. In the case of tangible personal property, the description shall include its usual location. In the case of real property, the description shall include both its legal description and its street address or common designation, if any.

(b) The title of the plaintiff as to which a determination under this chapter is sought and the basis of the title. If the title is based upon adverse possession, the complaint shall allege the specific facts constituting the adverse possession.

(c) The adverse claims to the title of the plaintiff against which a determination is sought.

(d) The date as of which the determination is sought. If the determination is sought as of a date other than the date the complaint is filed, the complaint shall include a statement of the reasons why a determination as of that date is sought.

(e) A prayer for the determination of the title of the plaintiff against the adverse claims.

“An element of a cause of action for quiet title is ‘[t]he adverse claims to the title of the plaintiff against which a determination is sought.’ (Code Civ. Proc., 761.020, subd. (c).)” West v. JP Morgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 802, bolding added.

Flair argues that not all elements of a quiet title claim have been plead, because the facts as alleged do not indicate the Kwoks have a claim of title. The Kwoks oppose by arguing that a claim for quiet title extends to other legal or equitable interests in real property. As is clear from the statute, quiet title concerns title, as challenged by other property rights/claims. The case on which the Kwoks rely supports this: “Title is not quieted as to boundaries, moving or otherwise; it is quieted as to legal interests in property.” Lechuza Villas West v. California Coastal Commission (1997) 60 Cal.App.4th 218, 242.

The Cross-Complaint does not contain any allegation regarding the source of the Kwoks’ title. Rather, the Kwoks allege they are the sole users and occupiers of the Disputed Property and that their use (and that of their predecessors) has been open and hostile for decades. Absent an allegation that they have paid taxes for the Disputed Property, this is not enough to constitute a claim of title. The Kwoks’ argument that they can seek rights other than title by means of the quiet title statute is not supported by the law they cite. The demurrer is therefore sustained as to this cause of action.

C. Prescriptive Easement

“To establish the elements of a prescriptive easement, the claimant must prove use of the property, for the statutory period of five years, which use has been (1) open and notorious; (2) continuous and uninterrupted; (3) hostile to the true owner; and (4) under claim of right. [Citations.] To establish adverse possession, the claimant must prove: (1) possession under claim of right or color of title; (2) actual, open, and notorious occupation of the premises constituting reasonable notice to the true owner; (3) possession which is adverse and hostile to the true owner; (4) continuous possession for at least five years; and (5) payment of all taxes assessed against the property during the five-year period.” (Mehdizadeh, supra, 46 Cal.App.4th at p. 1305, 54 Cal.Rptr.2d 284.)” Hansen v. Sandridge Partners, L.P. (2018) 22 Cal.App.5th 1020, 1032-1033, bolding added.

Each of these elements is alleged in 16, 20-24. Flair fairly concedes that this is so (Demurrer at 9:15) but argues that because the Kwoks allege that their use of the Encroached Property is exclusive, the complaint is deficient (Demurrer at 10:6). Based on the facts pleaded, including copies of surveys attached to the Cross-Complaint, the Kwoks’ use of the Encroached Property is exclusive. That anyone could potentially walk on the Kwok driveway does not alter the fact that Flair has lost the use of the Encroached Property. But the argument Flair raises goes to the merits rather than the sufficiency of the pleading. Some cases hold that where possession of disputed property is exclusive, the elements of adverse possession must be established in order to obtain a prescriptive easement.

“Because of the taxes element, it is more difficult to establish adverse possession than a prescriptive easement. The reason for the difference in relative difficulty is that a successful adverse possession claimant obtains ownership of the land (i.e., an estate), while a successful prescriptive easement claimant merely obtains the right to use the land in a particular way (i.e., an easement). (Mehdizadeh, supra, 46 Cal.App.4th at p. 1300, 54 Cal.Rptr.2d 284.)

“Unsurprisingly, claimants have often tried to obtain the fruits of adverse possession under the guise of a prescriptive easement to avoid having to satisfy the tax element. (Kapner v. Meadowlark Ranch Assn (2004) 116 Cal.App.4th 1182, 1187, 11 Cal.Rptr.3d 138.) That is, they seek judgments ‘employing the nomenclature of easement but ... creat[ing] the practical equivalent of an estate.’ (Raab, supra, 51 Cal.App.3d at p. 877, 124 Cal.Rptr. 590.) Such judgments ‘pervert[ ] the classical distinction in real property law between ownership and use.’ (Silacci, supra, 45 Cal.App.4th at p. 564, 53 Cal.Rptr.2d 37.) The law prevents this sophistry with the following rule: If the prescriptive interest sought by a claimant is so comprehensive as to supply the equivalent of an estate, the claimant must establish the elements of adverse possession, not those of a prescriptive easement. (Raab, at pp. 876–877, 124 Cal.Rptr. 590.) In other words, the law simply ‘does not allow parties who have possessed land to ignore the statutory requirement for paying taxes by claiming a prescriptive easement.’ (Kapner, at p. 1187, 11 Cal.Rptr.3d 138.)” Hansen, supra, 22 Cal.App.5th at 1033, bolding added.

The Kwoks rely on Otay Water District v. Beckwith (1991) 1 Cal.App.4th 1041, 1047, for the proposition that where possession has been exclusive the court may determine a prescriptive easement has been established. That holding is still law, though its holding has been more often distinguished than followed. Whether or not Otay will ultimately provide the rule in this action is not presently before the Court.

D. Equitable Easement

The Second District recently summarized the law governing equitable easements this way:

“Where there has been an encroachment on land without any legal right to do so, the court may exercise its powers in equity to affirmatively fashion an interest in the owner's land which will protect the encroacher's use, namely, a judicially created easement sometimes referred to as an ‘equitable easement.’ (Hirshfield, supra, 91 Cal.App.4th at pp. 764–765, 110 Cal.Rptr.2d 861; Tashakori v. Lakis (2011) 196 Cal.App.4th 1003, 1008, 126 Cal.Rptr.3d 838 (Tashakori).) In making its determination, the court engages in equitable balancing to determine, on the one hand, whether to prevent such encroachment or, on the other hand, permit such encroachment and award damages to the property owner. (Hirshfield, at p. 759, 110 Cal.Rptr.2d 861.)

“California courts have ‘discretionary authority to deny a landowner's request to eject a trespasser and instead force the landowner to accept damages as compensation for the judicial creation of an [equitable] easement over the trespassed-upon property in the trespasser’s favor, provided that the trespasser shows that (1) her trespass was “ ‘innocent’ ” rather than “ ‘willful or negligent,’ ” (2) the public or the property owner [seeking the injunction] will not be “ ‘irreparabl[y] injur[ed]’ ” by the easement, and (3) the hardship to the trespasser from having to cease the trespass is “ ‘greatly disproportionate to the hardship caused [the owner] by the continuance of the encroachment.’ ” ’ (Shoen v. Zacarias (2015) 237 Cal.App.4th 16, 19, 187 Cal.Rptr.3d 560 (Shoen); accord Tashakori, supra, 196 Cal.App.4th at pp. 1008–1009, 126 Cal.Rptr.3d 838 [factors apply to both physical encroachments and disputed rights of access over neighbors’ properties].)

“Unless all three elements are established, a court lacks discretion to grant an equitable easement. (Shoen, supra, 237 Cal.App.4th at p. 19, 187 Cal.Rptr.3d 560; see Ranch at the Falls LLC v. O'Neal (2019) 38 Cal.App.5th 155, 184–185, 250 Cal.Rptr.3d 585.) This is true even if the court believes the imposition of an equitable easement is fair and equitable under all circumstances. (Shoen, at pp. 19–21, 187 Cal.Rptr.3d 560.) Thus, the court’s focus must be on the three elements, rather than ‘“a more open-ended and free-floating inquiry into which party will make better use of the encroached-upon land, which values it more, and which will derive a greater benefit from its use.”’ (Id. at p. 21, 187 Cal.Rptr.3d 560.)” Romero v. Shih (2022) 78 Cal.App.5th 326, 355-356.

The Cross-Complaint alleges each of the necessary three elements for an equitable easement. The Kwoks’ innocent trespass/use of the Encroached Property is alleged in 5, 10, 16, and 27. The lack of irreparable harm to Flair is alleged in 28. And the Kwoks’ hardship from having to cease trespassing/using the Encroached Property is alleged in 29.

Flair urges that the Kwoks must allege facts establishing that they are innocent; but the facts alleged show that the Kwoks have been using the property in the same manner since they purchased it in 2011, just as their predecessors in interest had, and that they did not learn of the encroachment issue until 2017. Flair urges that the Kwoks cannot pass the relative hardship test. That is not a question to be resolved at the demurrer stage. The factual allegations regarding the hardships involved in ceasing use of the Encroached Property are sufficiently plead.

IV. CONCLUSION AND ORDER

Demurrer to the quiet title cause of action is sustained for failure to state a cause of action. Code Civ. Proc. 430.10(e). The pleading lacks any allegation that the Kwoks have an ownership interest in the Encroached Property.

Demurrers to the prescriptive easement and equitable easement causes of action are overruled.

The Kwoks are granted leave to amend the quiet title cause of action.

Any amended complaint must be filed within 14 days of today’s date (i.e., by March 20).

If no pleading is filed by that date, Flair is to answer within 10 days thereafter (by March 30).

Flair is ordered to give notice of this ruling.

Dated:

MARGARET L. OLDENDORF

JUDGE OF THE SUPERIOR COURT



Case Number: *******0903 Hearing Date: January 3, 2023 Dept: P

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

NORTHEAST DISTRICT

FLAIR CAPITAL MANAGEMENT LLC, a California Limited Liability Company,

Plaintiff,

vs.

ALLAN KWOK AND KITTY KWOK, AS TRUSTEES OF THE ALLAN KWOK AND KITTY KWOK LIVING TRUST DATED JUNE 7 2006; and DOES 1 through 10, inclusive,

Defendants.

And related cross-action.

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Case No.: *******0903

[TENTATIVE] ORDER OVERRULING DEFENDANTS’ DEMURRER AND GRANTING DEFENDANTS’ MOTION TO STRIKE

Date: January 3, 2023

Time: 8:30 a.m.

Dept.: P

I. INTRODUCTION

This action concerns a boundary dispute between the owners of real properties located in South Pasadena on which multi-unit residential dwellings are located. Defendants Allan and Kitty Kwok (the Kwoks) own real property (held in trust) that encroaches on property owned by Plaintiff Flair Capital Management, LLC (Flair).

There is a block wall sometimes called a retaining wall (which seems to indicate that the Kwok property is on higher elevation than the Flair property) dividing the two properties. On the Kwok side of the boundary is a driveway. The allegation is that the wall encroaches on the Flair property along the entire boundary. The strip of land in dispute is less than three feet wide and amounts to approximately 480 square feet. Based on the allegations and surveys attached to both the verified complaint and verified cross-complaint, the retaining wall is entirely on the Flair property and the wall cuts off Flair’s access to the Encroached Property. Flair sues for Trespass, Declaratory Relief, and Quiet Title. The Kwoks have filed a cross-complaint for Quiet Title, Prescriptive Easement, and Equitable Easement.

At issue is the Kwoks’ demurrer to the Flair Complaint and their motion to strike. The demurrer is mainly based on a statute of limitations argument that cannot be established on the pleadings; the demurrer is therefore overruled. The motion to strike is addressed to the prayer for punitive damages and attorney fees. As the allegations are insufficient to support the prayer, the motion to strike is granted.

II. DEMURRER

A. Legal Standard

1. Law Governing Demurrers

Code Civ. Proc. 430.10(e) provides for a demurrer on the basis that a complaint fails to state a cause of action. A demurrer admits, provisionally for purposes of testing the pleading, all material facts properly pleaded. Tindell v. Murphy (2018) 22 Cal.App.5th 1239, 1247. A demurrer tests the legal sufficiency of a complaint. Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994.

2. Law Governing Judicial Notice

“It is the consequence of judicial notice that the ‘fact’ noticed is, in effect, treated as true for purposes of proof. ‘Under the doctrine of judicial notice, certain matters are assumed to be indisputably true, and the introduction of evidence to prove them will not be required. Judicial notice is thus a substitute for formal proof. [Citation.]’ (1 Witkin, Cal. Evidence (3d ed. 1986) 80, p. 74.) Therefore, a finding of fact that was judicially noticed would be removed as a subject of dispute and would be accepted for evidentiary purposes as true. The effect would be that without resort to concepts of collateral estoppel or res judicata that would litigate whether the issue was fully addressed and resolved, a finding of fact would be removed from dispute in the other action in which it was judicially noticed.”

Sosinksy v. Grant (1992) 6 Cal.App.4th 1548, 1564 (declining to take judicial notice of findings of fact made by a judge in a prior proceeding).

“Although the existence of a document may be judicially noticeable, the truth of statements contained in the document and its proper interpretation are not subject to judicial notice if those matters are reasonably disputable. StorMedia, Inc. v. Superior Court (1999) 20 Cal.4th 449, 457, fn. 9, 84 Cal.Rptr.2d 843, 976 P.2d 214. The California Supreme Court stated in StorMedia: ‘In ruling on a demurrer, a court may consider facts of which it has taken judicial notice. (Code Civ. Proc., 430.30, subd. (a).) This includes the existence of a document. When judicial notice is taken of a document, however, the truthfulness and proper interpretation of the document are disputable. (Joslin v. H.A.S. Ins. Brokerage (1986) 184 Cal.App.3d 369, 374 [228 Cal.Rptr. 878].)’ (Ibid.)” Freemont Indemnity Co. v. Freemont General Corp. (2007) 148 Cal.App.4th 97, 113.

3. Law Governing Statute of Limitations for Quiet Title

“The Legislature has not established a specific statute of limitations for actions to quiet title. (Muktarian v. Barmby (1965) 63 Cal.2d 558, 560).) Therefore, courts refer to the underlying theory of relief to determine the applicable period of limitations. (Ibid.; see 53 Cal.Jur.3d (2012) Quieting Title, 34, pp. 412-413.) An inquiry into the underlying theory requires the court to identify the nature (i.e., the ‘gravamen’) of the cause of action. (Hensler v. City of Glendale (1994) 8 Cal.4th 1, 22.) [ ] Generally, the most likely time limits for a quiet title action are the five-year limitations period for adverse possession, the four-year limitations period for the cancellation of an instrument, or the three-year limitations period for claims based on fraud and mistake.” Salazar v. Thomas (2015) 236 Cal.App.4th 467, 476 (internal citations shortened and footnotes omitted).

In action based on a boundary dispute to recover real property or possession thereof, the statute of limitations is five years. Martin v. Van Bergen (2012) 209 Cal.App.4th 84, citing Code Civ. Proc. 318.

The statute of limitations does not run against one in possession of the real property. Reuter v. Macal (2020) 57 Cal.App.5th 571, 578. A landowner who knows of potential adverse claims has no reason to go to the expense of litigation until such claim is pressed against him. Salazar, supra, 236 Cal.App.4th at 477-478; Reuter v. Macal (2020) 57 Cal.App.5th 571, 578.

4. Law Governing Statute of Limitations for Trespass

The demurrer argues that Flair alleges a permanent trespass (rather than a continuing trespass), and therefore that Code Civ. Proc. 338(b)’s three-year statute of limitation applies. “The crucial test of the permanency of a trespass or nuisance is whether the trespass or nuisance can be discontinued or abated.” Mangini v. Aerojet-General Corp. (1996) 12 Cal.4th 1087, 1097.

“Where a trespass consists of a physical entry upon the lands of another and taking possession thereof under such circumstances as to indicate an intention that the trespass shall be permanent, the law may regard the wrong done in such case as complete at the time of the entry and allow recovery in a single action of all damages resulting therefrom, including prospective as well as past damages. . . . But where the wrong consists of an encroachment which was not willful but unintentional, and which is abatable, the law does not presume that such an encroachment will be permanently maintained.” Kafka v. Bozio (1923) 191 Cal. 746, 750-751, bolding added.

In a recent Second District Case on somewhat similar facts, a boundary dispute was found to be a continuing rather than permanent trespass because the fence at issue in that case could be moved: “Under this test, sometimes referred to as the ‘abatability test’ (see, e.g., Beck, supra, 44 Cal.App.4th at p. 1220, 52 Cal.Rptr.2d 518), a trespass or nuisance is continuing if it ‘can be remedied at a reasonable cost by reasonable means.’ (Mangini, supra, 12 Cal.4th at p. 1103, 51 Cal.Rptr.2d 272, 912 P.2d 1220.)” Madani v. Rabinowitz (2020) 45 Cal.App.5th 602, 609.

B. Analysis

1. The Complaint Is Not On Its Face Time-Barred

The defendants’ central argument on demurrer is that since the Complaint admits at 7 that Flair has known since 2017 about the encroachment, and since the trespass is permanent, the trespass cause of action is time-barred as it was not filed within three years thereafter. Defendants further argue that the other claims (quiet title and declaratory relief) stem from and are grounded in the alleged trespass and are therefore barred as well.

The trespass is permanent, the Kwoks argue, “because the driveway, which itself is permanent, cannot be moved as there is no room for the driveway in any other location, and moving or shrinking of the driveway would cause the 1734 Property to be in violation of the City of South Pasadena zoning ordinances as to driveway width (as it would be less than 10 ft. in width),” citing South Pasadena’s zoning ordinance 36.220.050(C). Memorandum of Points and Authorities at 9:24 – 10:2. This argument cannot be made at the demurrer stage, because it goes beyond the four corners of the pleading. There are no allegations in the Flair Complaint about the width of the Kwok’s driveway, or whether or not it can be moved to another location. The Kwoks did not request that judicial notice be taken of their own verified cross-complaint, which alleges at 10.d that moving the wall would cause the driveway to be out of compliance with the ordinance’s 10-foot requirement. But even if they had, and even if judicial notice were taken of the allegation, it is not enough to sustain the demurrer. This is so because while Evid. Code 452(d) permits judicial notice of court records, taking judicial notice does not establish the truth of the allegations contained therein. Sosinksy v. Grant (1992) 6 Cal.App.4th 1548; Freemont Indemnity Co. v. Freemont General Corp. (2007) 148 Cal.App.4th 97. If the rule were otherwise, there would be no need for litigation; one could proceed from a verified complaint straight to judgment. Finally, even if the Court could take judicial notice of the fact that the Kwok’s driveway would be less than 10 feet wide if the boundary wall were moved to the correct location (causing them to be in violation of the city ordinance), this would only be a factor, but not the sole factor, in determining whether the trespass is permanent or continuing.

The parties make various arguments about whether the trespass can be abated, none of which is appropriately resolved at the pleading stage. Thus, to the extent the demurrer is based on the argument that Flair’s claims are barred by the statute of limitations for trespass, the demurrer is overruled.

In opposing the demurrer, Flair urges that the statute of limitations for quiet title is five years and that it is essentially based on an adverse possession claim that did not accrue until the Kwoks filed their cross-complaint. The Kwoks vigorously disagree with the adverse possession analysis in their Reply, arguing they are not claiming any ownership interest. That argument is at odds with their cross-complaint, which pleads a competing quiet title claim and prays for a judgment quieting title in them.

In sum, whether grounded in trespass or adverse possession, the Kwoks have not shown that the quiet title claim is on its face time-barred. The issues of which statute of limitations applies and when it accrued cannot be decided at the demurrer stage.

2. Plaintiff May Allege A Declaratory Relief Cause Of Action

The other demurrer argument is that declaratory relief is a remedy, not a cause of action. While cases have affirmed the sustaining of a demurrer where a declaratory relief claim is based on other nonviable causes of action (as in Faunce v. Cate (2013) 222 Cal.App.4th 166, 173), the reasoning is that declaratory relief should not be permitted as a way around those non-viable claims. Other cases state that where the claims in a declaratory relief cause of action are “fully engaged” by other causes of action, declaratory relief may be “unnecessary and superfluous.” Hood v. Superior Court (1995) 33 Cal.App.4th 319, 324.

In this case Flair’s declaratory relief cause of action seeks a determination that it is and has been the sole owner of the Encroached Property, and that the Kwoks must either return it or pay fair market value for it. That part may be redundant of the quiet title cause of action. But Flair also alleges that once the correct boundary is settled, it seeks a determination that the Kwoks must contribute 50% to the upkeep of the boundary. Complaint, 25. This is not redundant of the other claims.

In sum, the pleading alleges sufficient facts to demonstrate that there is an existing controversy relating to the rights and duties of the parties with respect to real property. Code Civ. Proc. 1060. Consequently, sufficient facts are alleged to state a cause of action for declaratory relief.

The demurrer is therefore overruled on all grounds.

III. MOTION TO STRIKE

A. Legal Standard

1. Motions to Strike

Code Civ. Proc. 436: “The court may, upon a motion made pursuant to Section 435, or at any time in its discretion, and upon terms it deems proper:

(a) Strike out any irrelevant, false, or improper matter inserted in any pleading.

(b) Strike out all or any part of any pleading not drawn or filed in conformity with the laws of this state, a court rule, or an order of the court.”

2. Punitive Damages

Civ. Code 3294:

“(a) In 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, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.”

“(c) As used in this section, the following definitions shall apply:

(1) ‘Malice’ means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.

(2) ‘Oppression’ means despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person's rights.

(3) ‘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.”

B. Motion to Strike is Granted

The Kwoks move to strike the prayer for punitive damages and attorney fees. This motion has merit. The pleading does not allege any facts to support the recovery of attorney fees, making the prayer for fees improper. In fact, Flair concedes this in its opposition to the motion to strike.

As for punitive damages, the only pertinent allegation is that the Kwoks “intentionally, recklessly, and/or negligently entered the property.” Given the facts here, an existing retaining wall that does not mark the true boundary line, the trespass appears to be unavoidable until the dispute is resolved. These facts do not demonstrate malice, fraud or oppression. As such, the prayer for punitive damages is improper and properly stricken. Flair’s request for leave to amend is denied at this time; but it is without prejudice to a later motion requesting leave to amend, if appropriate, after evidence has been developed to support such allegations.

IV. CONCLUSION AND ORDER

For the foregoing reasons, the demurrer to the complaint is overruled. The Kwoks are ordered to file an answer within ten days.

The motion to strike the prayer for attorney fees and for punitive damages is granted. This order is without prejudice to a later motion for leave to amend to allege a right to punitive damages, if appropriate.

Plaintiff Flair is ordered to give notice of this ruling.

Dated:

MARGARET OLDENDORF

JUDGE OF THE SUPERIOR COURT