On 02/23/2018 REVERSE MORTGAGE SOLUTIONS INC filed a Property - Other Real Property lawsuit against KMC LANDSCAPING SERVICES. This case was filed in Los Angeles County Superior Courts, Stanley Mosk Courthouse located in Los Angeles, California. The Judges overseeing this case are MICHAEL L. STERN, GREGORY W. ALARCON and DANIEL S. MURPHY. The case status is Pending - Other Pending.
Pending - Other Pending
Los Angeles County Superior Courts
Stanley Mosk Courthouse
Los Angeles, California
MICHAEL L. STERN
GREGORY W. ALARCON
DANIEL S. MURPHY
REVERSE MORTGAGE SOLUTIONS INC
COHICK MATTHEW JAY
KMC LANDSCAPING SERVICES INC
PIPER DAVID D. ESQ.
WOO MELISSA W.
WOO MELISSA W. ESQ.
3/6/2019: Minute Order
11/19/2018: Minute Order
11/19/2018: Notice of Case Reassignment/Vacate Hearings
11/13/2018: Challenge To Judicial Officer - Peremptory (170.6)
9/14/2018: CASE MANAGEMENT STATEMENT
9/18/2018: NOTICE OF CONTINUANCE OF CASE MANAGEMENT CONFERENCE AND OF ORDER TO SHOW CAUSE RE DISMISSAL FOR FAILURE TO PROSECUTE
8/21/2018: Minute Order
6/27/2018: NOTICE RE: CONTINUANCE OF HEARING
5/10/2018: DECLARATION OF STEFAN PEROVICH IN SUPPORT OF REQUEST TO CONTINUE OSC RE SERVICE AND CASE MANAGEMENT CONFERENCE FOR 90- DAYS TO FACILITATE SETTLEMENT AND PROPOSED ORDER
5/11/2018: Minute Order
5/4/2018: PLAINTIFF'S REQUEST TO CONTINUE OSC RE SERVICE AND CASE MANAGEMENT CONFERENCE FOR 90-DAYS TO FACILITATE SETTLEMENT
5/4/2018: Minute Order
2/23/2018: COMPLAINT FOR: 1. CANCELLATION OF INSTRUMENT ;ETC
Hearingat 08:30 AM in Department 32 at 111 North Hill Street, Los Angeles, CA 90012; Status Conference Re: BankruptcyRead MoreRead Less
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DocketMinute Order ( (Status Conference Re: Bankruptcy)); Filed by ClerkRead MoreRead Less
Docketat 08:30 AM in Department 32, Daniel S. Murphy, Presiding; Hearing on Motion to Compel Further Discovery Responses - Not Held - Taken Off Calendar by PartyRead MoreRead Less
Docketat 08:30 AM in Department 32, Daniel S. Murphy, Presiding; Hearing on Demurrer - without Motion to StrikeRead MoreRead Less
DocketNotice (of Proof of Claim General Bar Date); Filed by Reverse Mortgage Solutions INc (Plaintiff)Read MoreRead Less
Docketat 08:30 AM in Department 32, Daniel S. Murphy, Presiding; Case Management Conference - Not Held - Vacated by CourtRead MoreRead Less
DocketCertificate of Mailing for (Minute Order (Case Management Conference) of 03/06/2019); Filed by ClerkRead MoreRead Less
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DocketCOMPLAINT FOR: 1. CANCELLATION OF INSTRUMENT ;ETCRead MoreRead Less
DocketComplaint; Filed by Reverse Mortgage Solutions INc (Plaintiff)Read MoreRead Less
DocketSUMMONSRead MoreRead Less
Case Number: BC695601 Hearing Date: July 13, 2020 Dept: 32
reverse mortgage solutions, inc.,
KMC LANDSCAPING SERVICES INC. & MATTHEW JAY COHICK,
Case No.: BC695601
Hearing Date: July 13, 2020
[TENTATIVE] order RE:
demurrer to first amended complaint
Plaintiff Reverse Mortgage Solutions, Inc. (RMS) commenced this action against Defendants KMC Landscaping Services Inc. (KMC) and Matthew Jay Cohick (Cohick) on February 23, 2018. The operative pleading is the First Amended Complaint (FAC) filed on January 2, 2020. The FAC names two additional defendants: Suretec Indemnity Company (SIC) and American Contractors Indemnity Company (ACIC). The FAC asserts causes of action for (1) slander of title against KMC and Cohick, (2) fraud against KMC and Cohick, (3) negligent misrepresentation against KMC and Cohick, (4) unfair business practices against KMC and Cohick, (5) intentional interference with a prospective economic advantage against KMC and Cohick, and (6) foreclosure on contractor’s bonds against KMC, SIC, and ACIC. The FAC alleges in pertinent part as follows.
RMS owns certain real properties that have been foreclosed on or that are in the process of being foreclosed upon pursuant to loans that are federally insured through the Federal Housing Administration. RMS had an arrangement with National Field Network (NFN) for NFN to provide property preservation services (e.g., grass cutting) for these properties. NFN has its own network of subcontractors, including Defendant KMC, that NFN separately contracted with to perform these services.
Beginning in September 2017, KMC through its principal Cohick began recording mechanics liens against more than 85 properties owned by RMS. These liens are invalid because KMC did not provide RMS with proper preliminary notice. When RMS learned about the liens, RMS requested that Defendants provide supporting documentation. In response, Defendants submitted fraudulent invoices. RMS has demanded that Defendants release the liens, and Defendants have refused. Because of the liens, RMS cannot deliver clear title upon foreclosure.
Defendants KMC, Cohick, SIC, and ACIC (collectively, Defendants) demur to each cause of action in the FAC.
A. All Causes of Action
Defendants contend that each cause of action fails because each is predicated on the recording of a mechanic’s lien, an act which Defendants claim is immunized from liability under Civil Code section 47(b), the litigation privilege. RMS responds, among other things, that the fraudulent recording of a mechanic’s lien is not protected by the litigation privilege and thus may form a basis for tort liability. The Court agrees with RMS.
The litigation privilege codified at Civil Code section 47(b) precludes tort liability arising from certain statements. (Kerner v. Superior Court (2012) 206 Cal.App.4th 84, 120-21.) “The usual formulation is that the privilege applies to any communication (1) made in judicial or quasi-judicial proceedings; (2) by litigants or other participants authorized by law; (3) to achieve the objects of the litigation; and (4) that have some connection or logical relation to the action.” (Silberg v. Anderson (1990) 50 Cal.3d 205, 212.) Communications made in judicial proceedings include “[c]ommunications preparatory to or in anticipation of the bringing of an action.” (Digerati Holdings, LLC v. Young Money Entertainment, LLC (Digerati) (2011) 194 Cal.App.4th 873, 889.) However, “[a] prelitigation communication is privileged only if it ‘relates to litigation that is contemplated in good faith and under serious consideration.’ ” (Ibid.) These additional requirements “provide some assurance that the communication has some ‘connection or logical relation’ to a contemplated action that is made ‘to achieve the objects’ of the litigation.” (Ibid.) These additional requirements present issues of fact. (Ibid.)
Here, as Defendants point out, the recording of a mechanic’s lien is an act ordinarily protected under the litigation privilege because the recording is “clearly authorized by law” and “is related to an action to foreclose.” (Frank Pisano & Associates v. Taggart (Pisano) (1972) 29 Cal.App.3d 1, 25 (citing Mechanic’s Lien statutes); see also Wilton v. Mountain Wood Homeowners Assn. (Wilton) (1993) 18 Cal.App.4th 565, 569 (relying on Pisano in holding that the publication of a homeowners’ assessment lien is privileged).)
Chiefly relying on Pisano, Defendants contend that their alleged motive — fraudulent or not — in recording the mechanic’s lien is irrelevant because “the litigation privilege is absolute, which means it applies regardless of the existence of malice or intent to harm.” (Wise v. Thrifty Payless, Inc. (2000) 83 Cal.App.4th 1296, 1302.) But Defendants overlook the fact that the recording of a mechanic’s lien is a prelitigation communication. As such, intent is relevant in determining whether the recording “relates to litigation that is contemplated in good faith and under serious consideration.” (Digerati, supra, 194 Cal.App.4th at 889.)
Illustrating this point is A.F. Brown Electrical Contractor, Inc. v. Rhino Electric Supply, Inc. (Brown) (2006) 137 Cal.App.4th 1118. In Brown, a school district hired an electrical contractor to perform electrical services. The contractor issued two purchase orders to suppliers of electrical goods and paid the suppliers the amounts that the contractor believed were owed. The suppliers asserted that the contractor owed additional monies so they issued two stop notices to the school district and used a collection agency to pursue a claim against the contractor’s bond. The contractor subsequently sued the suppliers for libel, slander, and unfair business practices. The suppliers filed a special motion to strike which the trial court denied. The suppliers appealed. (Brown, supra, 137 Cal.App.4th at 1123-24.)
On appeal, the suppliers contended that stop notices are generally subject to the litigation privilege. The appellate court concurred. The appellate court likened the stop notices to a mechanic’s lien as both “are authorized by law and relate to an action for collection.” Moreover, the appellate court noted that both are “part of the California lien law scheme” and, as such, “must be construed together” to create “an integrated and harmonious scheme.” Citing Wilton’s conclusion that the recording of a mechanic’s lien is privileged, the appellate court concluded that stop notices should be treated the same for purposes of the litigation privilege. (Brown, supra, 137 Cal.App.4th at 1127-28.)
The critical question became whether the litigation privilege applied to the stop notices at issue in the case. The appellate court found that the privilege did not apply. The appellate court reasoned that stop notices are “prelitigation communications” that are protected only if the communications are “made in connection with a proposed litigation that is ‘contemplated in good faith and under serious consideration.’ ” The appellate court concluded that the suppliers had failed to establish that the lawsuit was under serious consideration so they failed to demonstrate that that litigation privilege covered the stop notices. (Brown, supra, 137 Cal.App.4th at 1128-29.)
The same result attaches here. The recording of a mechanic’s lien, like the issuance of a stop notice, is a prelitigation communication covered by the litigation privilege only if the recording was made in connection with a proposed litigation that is contemplated in good faith and under serious consideration. RMS alleges that the liens’ recordings were not made with this intent. According to RMS, “the Mechanics Liens were fraudulent” because, among other things, Defendants seek payment for services never provided. (FAC ¶ 60.) On demurrer, the Court must accept these allegations and conclude the litigation privilege does not apply.
Pisano and Wilton do not militate against this conclusion. Pisano was an early case extending the litigation privilege to prelitigation communications so it was decided at a time when courts had not yet fully developed the prelitigation communication requirements. (See Edwards v. Centex Real Estate Corp. (1997) 53 Cal.App.4th 15, 31.) Nonetheless, Pisano noted that the litigation privilege applied to the recording of the mechanic’s lien, in part, because the recording “had a reasonable relation to an action to foreclose the lien.” (Pisano, supra, 29 Cal.App.3d at 25.) In the Court’s view, this requirement that the lien have a “reasonable relation” to a foreclosure action is akin to the requirement that the communication be made “in connection with a proposed litigation that is contemplated in good faith and under serious consideration.” In Wilton, the appellate court reviewed homeowners’ assessment liens, not mechanic’s liens, and did not evaluate whether the litigation privilege would apply if a party recorded a lien in bad faith.
B. Sixth Cause of Action
In RMS’s sixth cause of action for foreclosure on contractor’s bond, RMS alleges that ACIC and SIC are surety companies which posted indemnity bonds for KMC. (FAC ¶¶ 94-95.) RMS alleges that KMC is liable to RMS for its wrongful and fraudulent acts and that ACIC and SIC are, in turn, liable to RMS for KMC’s wrongful acts. (FAC ¶¶ 96-97.) Per this cause of action, RMS seeks to foreclose and collect on the bonds. (FAC ¶ 98.)
Defendants argue that this cause of action fails because a surety’s liability for a contractor’s bond is established by statute and the governing statute (Bus. & Prof. Code § 7071.5) does not provide for liability under the circumstances. The Court disagrees.
Business and Professions Code section 7071.5 states that a contractor’s bond “shall be for the benefit of,” among others, “[a] person damaged as a result of a willful and deliberate violation of this chapter by the licensee, or by the fraud of the licensee in the execution or performance of a construction contract.” (§ 7071.5(c).) Under section 7071.5, the contractor’s bonds “are essentially third-party beneficiary contracts, the penal sum protecting certain specified classes of people who are harmed in specified ways in dealing with the contractor.” (In re Buna Painting & Drywall Co., Inc. (9th Cir. 1974) 503 F.2d 618, 619.) Accordingly, the persons protected by the bond may maintain an action against the contractor and its surety for damages. (9 Miller & Starr, Cal. Real Estate (4th ed. 2020) § 32:127.)
According to the FAC, RMS is “[a] person damaged … by the fraud of the licensee in the execution of performance of a construction contract” because KMC and Cohick submitted to RMS fraudulent invoices and documentation to receive payment for their services. (FAC ¶ 40.) On this basis, RMS can maintain a claim against KMC’s contractor’s bond.
Defendants respond that KMC’s and Cohick’s purportedly fraudulent act does not arise from the “execution or performance of a construction contract.” Defendants note that the purportedly fraudulent acts occurred after KMC rendered the property preservation services to NFN. (FAC ¶ 34.) This argument is unpersuasive. The contract at issue is “reasonably susceptible” to RMS’s interpretation that contractual performance entails the contractor’s submission of invoices to the client in order to receive payment. (Aragon-Haas v. Family Security Ins. Services, Inc. (1991) 231 Cal.App.3d 232, 239 (noting that demurrer admits “any pleaded meaning to which the instrument is reasonably susceptible”).) Uncertainties about the scope and obligations of the contract at issue can be resolved through discovery.
Defendants’ demurrer to RMS’s sixth cause of action is overruled.
Defendants’ demurrer to the FAC is overruled.
 Defendants’ requests for judicial notice are granted. (Evid. Code § 452(d).)
 In their briefs, RMS and Defendants both rely upon unpublished California Court of Appeals opinions. (Sirkus v. Love ; Mohammadian v. Neff Rental, Inc. Their reliance on these cases violates the well-established rule of court prohibiting parties from citing or relying upon unpublished decisions. (CRC Rule 8.1115(a).) Accordingly, the Court did not read or consider these decisions.
Case Number: BC695601 Hearing Date: November 15, 2019 Dept: 32
TINA ABDOLHOSSEINI, et al.
Case No.: 19STCV26150
Hearing Date: November 15, 2019
[TENTATIVE] order RE:
(1) demurrer to complaint
(2) motion to strike portions of the COMPLAINT
Plaintiff Khosrow Gharib (“Plaintiff”) commenced this action against Defendant Tina Abdolhosseini (“Defendant”) on July 26, 2019. The Complaint asserts causes of action for (1) professional negligence, (2) breach of fiduciary duty, and (3) breach of contract. The Complaint alleges in pertinent part as follows.
Plaintiff and Bahar Gharib (“Bahar”) were parties in a marital dissolution action in Los Angeles Superior Court. On October 12, 2017, Bahar filed a request for order (“RFO”) to determine past due child support. Plaintiff filed a responsive declaration denying, in general terms, the allegations asserted by Bahar in her RFO. On a hearing on the RFO held on December 1, 2017, the trial court determined that supplemental evidence was required to make a final determination. The trial court continued the hearing to March 7, 2018 to provide Plaintiff with time to gather and submit supplemental evidence in support of his opposition to the RFO.
On December 29, 2017, Plaintiff retained Defendant to represent him in the marital dissolution action. Because Defendant claimed to have difficulties obtaining a copy of the December 1, 2017 hearing transcript, Bahar’s counsel agreed to continue the hearing on the RFO to May 24 and 25, 2018. The Los Angeles Court Reporter’s Office informed Defendant that the transcript was available for pick-up on April 16, 2018, but Defendant failed to pick it up until April 24, 2018.
On May 22, 2018, Defendant appeared before the trial court ex parte to request a continuance of the evidentiary hearings. In support of the ex parte application, Defendant submitted a declaration citing difficulty in obtaining the transcript as the basis for the continuance. The trial court denied Defendant’s request, and Defendant failed to timely submit supplemental evidence. At the hearings, Ira M. Friedman, Esq. (“Friedman”), Defendant’s co-counsel in the matter, was limited to presenting impeachment evidence.
Following the hearing, Plaintiff through Friedman filed an RFO for relief under CCP section 473(b). Plaintiff submitted another declaration from Defendant citing difficulties in obtaining the transcript, calendaring errors by her staff, and her mother’s illness as bases for her failure to timely prepare for the evidentiary hearing. The trial court denied this RFO, finding that Defendant committed inexcusable neglect. The trial court determined that Plaintiff’s remedy lay against Defendant for malpractice.
Ultimately, the trial court awarded Bahar $586,265 in child support arrears. Due to Defendant’s malpractice, Plaintiff suffered damages because he was forced to incur additional attorney fees and pay more in child support arrears.
Defendant demurs to each cause of action in the Complaint on the ground that each fails to state facts sufficient to constitute a valid cause of action against her.
A. Legal Standard
A demurrer challenges only the legal sufficiency of the complaint, not the truth of its factual allegations or the plaintiff's ability to prove those allegations. (Picton v. Anderson Union High Sch. Dist. (1996) 50 Cal. App. 4th 726, 732.) The court must treat as true all the complaint’s material factual allegations, but not contentions, deductions or conclusions of fact or law. (Id. at 732-33.) The complaint is to be construed liberally to determine whether a cause of action has been stated. (Id. at 733.)
Defendant argues that each of Plaintiff’s causes of action is time-barred by the one-year statute of limitations set forth at CCP section 340.6.
“The soundness of a statute of limitations defense depends on four variables: (1) What is the governing limitations period? (2) On what date did the cause of action accrue, such that the limitations period began to run? (3) How much time elapsed between accrual and the filing of the complaint? (4) For what period(s) of time, if any, was the running of the statute suspended (tolled)? If the elapsed time from accrual to filing, less any period of tolling, exceeds the limitations period, then the statute ran before the complaint was filed and the action is barred.” (Schmidlin v. City of Palo Alto (2007) 157 Cal.App.4th 728, 746-47.)
The parties agree on resolution of the first variable: CCP section 340.6 is the governing limitations period. That statute states in relevant part: “An action against an attorney for a wrongful act or omission, other than for actual fraud, arising in the performance of professional services shall be commenced within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first.” The statute, on its face, plainly applies to legal malpractice claims (first cause of action). Case law has confirmed that this statute also extends to a breach of a fiduciary duty claim in the attorney-client context (second cause of action) and breach of a legal services agreement (third cause of action). (Stoll v. Superior Court (1992) 9 Cal.App.4th 1362, 1363 (“[T]he statute of limitations within which a client must commence an action against an attorney on a claim for legal malpractice or breach of a fiduciary duty is identical.”); see Levin v. Graham & James (1995) 37 Cal.App.4th 798, 805 (noting that section 340.6’s statute of limitations applies to “any wrongful act or omission of an attorney arising in the performance of professional services … whether the theory of liability is based on the breach of an oral or written contract…”).)
The parties disagree on resolution of the second variable. Defendant posits that Plaintiff’s claims accrued “as early as May 24-25, 2018 but certainly no later than July 18, 2018.” (Dem. at 6-7.) Plaintiff does not concede the same.
“Generally speaking, a cause of action accrues at ‘the time when the cause of action is complete with all of its elements.’ ” (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 806.) A legal malpractice claim has the following elements: (1) the duty of the attorney to use such skill, prudence, and diligence as members of his or her profession commonly possess and exercise; (2) a breach of that duty; (3) a proximate causal connection between the breach and the resulting injury; and (4) actual loss or damage resulting from the attorney’s negligence. (Wilkinson v. Zelen (2008) 167 Cal.App.4th 37, 45.) In addition, section 340.6 “makes the plaintiff’s actual or constructive discovery of the defendant’s wrongdoing an element of its one-year-from-discovery limitations defense.” (Samuels v. Mix (1999) 22 Cal.4th 1, 8.)
Plaintiff’s legal malpractice claim rests on the assertion that Defendant was negligent in preparing for the continued hearing on Bahar’s RFO to determine past due child support. According to Plaintiff, Defendant’s failure to timely submit supplemental evidence at the May 24 and 25, 2018 hearings caused Plaintiff to suffer damages. (Compl. ¶¶ 10-11, 17-18.)
An examination of the face of the Complaint discloses that most of the elements of this statute of limitations defense were satisfied more than one year before the Complaint was filed. Defendant owed Plaintiff a duty as his attorney and allegedly breached that duty by May 24 and 25, 2018 when Defendant failed to timely submit supplemental evidence. Further, Plaintiff knew or should have known about Defendant’s alleged breach because Defendant’s failure to submit this evidence was the subject of an ex parte application and a motion for relief under CCP section 473. Most tellingly, the trial court advised Plaintiff on July 18, 2018 that his remedy lay against Defendant for Defendant’s malpractice. (Compl. ¶ 11, Ex. 3.)
The issue of damages is more complicated. Case law examining the presence of damages looks for “actual injury.” (See Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 748 (noting that “actual injury,” as used in section 340.6, was intended to invoke Budd’s discussion of damages and appreciable harm).) “Actual injury occurs when the client suffers any loss or injury legally cognizable as damages in a legal malpractice action based on the asserted errors or omissions.” (Id. at 743.) That is, “[a]ctual injury refers only to the legally cognizable damage necessary to assert the cause of action. There is no requirement that an adjudication or settlement must first confirm a causal nexus between the attorney’s error and the asserted injury. The determination of actual injury requires only a factual analysis of the claimed error and its consequences. The inquiry necessarily is more qualitative than quantitative because the fact of damage, rather than the amount, is the critical factor. (Id. at 752.) Notably, “[t]he mere breach of a professional duty, causing only nominal damages, speculative harm, or the threat of future harm — not yet realized — does not suffice to create a cause of action for negligence.” (Id. at 750.)
Relying on Jordache, Defendant argues that Plaintiff suffered actual injury “when Plaintiff was advised by the [trial court] on July 18, 2018 that Plaintiff’s ‘remedy lies against Defendant for Defendant’s malpractice….’ ” (Dem. at 6.) The Court disagrees. While this statement may be arguably dispositive of actual or constructive discovery, this statement standing alone did not cause Plaintiff to suffer actual injury. The actual injury allegedly suffered by Plaintiff is, of course, the trial court’s ruling that Plaintiff must pay Bahar $586,265.00. The trial court issued this ruling on September 4, 2018, less than one year before Plaintiff commenced this action. (Compl. ¶ 12, Ex. 4.) Therefore, the statute of limitations has not expired on Plaintiff’s claims.
To show an earlier accrual date, Defendant also relies on Plaintiff’s allegation that “[b]ut for Defendant’s failure to timely submit supplemental evidence … Plaintiff would not have suffered damages.” (Compl. ¶ 18.) This allegation is not probative because it simply presents a theory of causation. Moreover, Defendant overlooks the underlying premise of this allegation — but for Defendant’s failure to timely submit supplemental evidence and the trial court’s ruling on the RFO, Plaintiff would not have suffered damages. The trial court’s ruling on the RFO is plainly a central component of Plaintiff’s causation element: “To establish causation in a legal malpractice action, the plaintiff must show that but for some error on the part of the defendant attorney, the plaintiff would have obtained a more favorable result.” (Hearn v. Howard (2009) 177 Cal.App.4th 1193, 1208 (emphasis added).)
Because the Complaint does not clearly disclose that these claims are time-barred, Defendant’s statute of limitations argument fails. (See Czajkowski v. Haskell & White, LLP (2012) 208 Cal.App.4th 166, 174.)
Assuming arguendo that Plaintiff’s claims did accrue as Defendant posits, the Court examines Plaintiff’s primary argument that the tolling exception codified at CCP section 340.6(a)(2) applies. That subdivision states that the limitations period “shall be tolled during the time that … [t]he attorney continues to represent the plaintiff regarding the specific subject matter in which the alleged wrongful act or omission occurred.” Plaintiff argues that this exception applies for two reasons: (1) Defendant never filed a substitution of attorney nor a notice of withdrawal as counsel in the marital dissolution action and (2) Plaintiff never alleged that Defendant ceased representing her.
Because Plaintiff is relying a on a tolling exception, Plaintiff must plead facts showing that the exception applies. (See 5 Witkin, Cal. Procedure (5th ed. 2008) Pleading, § 931 (“Where the complaint shows on its face that the cause of action is apparently barred, but the plaintiff relies on disability, absence of the defendant, or some other ground for suspension of the running of the statute [Citation], he or she must plead these facts or a demurrer will lie.”); Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 641 (“When a plaintiff relies on a theory of fraudulent concealment, delayed accrual, equitable tolling, or estoppel to save a cause of action that otherwise appears on its face to be time-barred, he or she must specifically plead facts which, if proved, would support the theory.”); Simpson Strong-Tie Co., Inc. v. Gore (2010) 49 Cal.4th 12, 23 (noting that burden of proving exception to statute falls on the one advancing the exception).) Plaintiff has not plead facts that Defendant continued to represent her during the limitations period, so Plaintiff’s second reason is without merit on this demurrer.
Plaintiff’s first reason is well-taken. CCP section 384 “governs the withdrawal or substitution of counsel in both civil and criminal cases.” (Lempert v. Superior Court (2003) 112 Cal.App.4th 1161, 1171.) That section states that the attorney in an action “may be changed at any time before or after judgment … (1) Upon the consent of both client and attorney, filed with the clerk, or entered upon the minutes [or] (2) Upon the order of the court, upon the application of either client or attorney, after notice from one to the other.” On its own motion, the Court has taken judicial notice of the files in the marital dissolution action between Plaintiff and Bahar. In those files, the Court has not found a substitution of attorney or withdrawal of attorney pertaining to Defendant. Absent this evidence, Plaintiff has, at least, a colorable argument that Defendant continued to represent her and that the statute of limitations was consequently tolled.
Defendant’s demurrer to the Complaint is OVERRULED.
MOTION TO STRIKE
Defendant moves to strike (1) Plaintiff’s prayer for punitive damages and (2) his allegations and exhibits relating to a CCP section 473 declaration filed by Defendant in the underlying martial dissolution action (FAC ¶¶ 11, 17b, 17d, 20, Exs. 2-3).
A. Legal Standard
Any party, within the time allowed to respond to a pleading, may serve and file a notice of motion to strike the whole or any part of that pleading. (CCP § 435(b).) The court may, upon a motion, or at any time in its discretion, and upon terms it deems proper, strike (1) any irrelevant, false, or improper matter inserted in any pleading and (2) 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. (CCP § 436.) The grounds for moving to strike must appear on the face of the pleading or by way of judicial notice. (CCP § 437.) When the defect which justifies striking a complaint is capable of cure, the court should allow leave to amend. (Perlman v. Municipal Court (1979) 99 Cal. App. 3d 568, 575.)
1. Punitive Damages
The parties have stipulated to allowing the Court to strike Plaintiff’s prayer for punitive damages. (Mot. at 9; Opp. at 7.) Accordingly, Defendant’s motion to strike Plaintiff’s prayer for punitive damages is GRANTED.
2. CCP Section 473 Declaration
Defendant contends that the section 473 declaration allegations should be stricken because they are irrelevant and inadmissible as a matter of public policy in this action. In support, Defendant relies exclusively on Smith v. Lewis (1975) 13 Cal.3d 349 disapproved on other grounds in In re Marriage of Brown (1976) 15 Cal.3d 838.
In Smith, a legal malpractice action, the trial court admitted into evidence at trial a CCP 473 declaration that the defendant attorney had submitted in the underlying action in support of the plaintiff client’s case. On appeal, the defendant challenged the declaration’s admission. The California Supreme Court held that this evidentiary ruling was mistaken in two respects. (Smith, supra, 13 Cal.3d at 364.)
First, “it properly should have been excluded from evidence on the ground that it had insubstantial probative value. (Evid. Code, § 352.) … [T]he evidence here has dubious relevance to the issues in the lawsuit. Not only is the declaration conclusionary in form and nondescriptive of defendant’s actual conduct, but it was filed on behalf of plaintiff at her request and represents merely an effort by defendant to advance his client’s cause. In contrast to its probative value, the harmful effect of the declaration in the eyes of the jury was potentially significant. On its face the declaration, under oath, is manifestly a confession of error on the part of defendant. The jury possibly could have misunderstood its context or its purpose, or confused the quantum of asserted negligence necessary to permit the amendment of a judgment with that required to support a finding of malpractice.” (Smith, supra, 13 Cal.3d at 364.)
Second, “as is the case with offers of compromise and subsequent remedial conduct, extrinsic policy reasons exist for excluding the declaration from evidence. (See Evid. Code, § 1150 et seq.) Were we to sanction the admissibility of such evidence, tension might develop between an attorney’s duty to zealously represent his client (A.B.A. Code of Prof. Responsibility, Canon 7) and his instinct of self-protection. As a result, the attorney could become reluctant to seek an amended judgment under Code of Civil Procedure section 473, and the quality of legal representation in the state might suffer accordingly. In short, an attorney should be able to admit a mistake without subjecting himself to a malpractice suit.” (Smith, supra, 13 Cal.3d at 364-65.)
Defendant’s reliance on Smith is unavailing. In Smith, the California Supreme Court was evaluating an evidentiary ruling issued at trial, not the propriety of section 473 declaration allegations in a pleading. To this end, the California Supreme Court did not find the declaration irrelevant but instead found that public policy and the danger of prejudice warranted the declaration’s exclusion. This Court is not making an evidentiary exclusion determination in a motion to strike. Suffice it to say, Defendant’s section 473 declaration may be relevant in some manner in this legal malpractice action.
Defendant’s motion to strike these allegations is DENIED.
Defendant’s motion to strike is GRANTED as to Plaintiff’s prayer for punitive damages and DENIED as to the remainder.
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