Brandon Spitzack v. Ford Motor Company et al.

Spread Your Wings, LLC (2023) 88 Cal.App.5th 243, 253.) Extrinsic evidence cannot be considered. That includes declarations. The court has considered the declaration from Ford’s counsel only to the extent it discusses the meet and confer efforts required by statute. The court has not considered the attached exhibit. The court has also not considered the declaration of Plaintiff’s counsel submitted with the late opposition.

DISCUSSION

Ford failed to adequately meet and confer before bringing this motion. Code of Civil Procedure section 439, subdivision (a) states that, before bringing a motion for judgment on the pleadings, the moving party shall meet and confer “in person, by telephone, or by video conference” with the other side. Sending a letter does not comply with the statute. But 7

because Code of Civil Procedure section 439, subdivision (a)(4) states that a failure to meet and confer is not itself a basis for denying a motion for judgment on the pleadings, the court will consider it on its merits.

Ford’s notice of motion targets the sixth cause of action solely on the ground that “Plaintiff failed to allege sufficient material factual allegations to support a claim for fraud.” (Notice of Motion and Motion at pp. 1:28-2:1.) In its supporting memorandum, Ford attempts to make other, unsupported, arguments that were not raised in the notice of motion, such as that sixth cause of action is uncertain and is barred by the statute of limitations. Those unsupported arguments are forfeited. (Kim v.

Sumitomo Bank (1993) 17 Cal.App.4th 974, 979 [court need not consider point unsupported by legal authority]; see also Allen v. City of Sacramento (2015) 234 Cal.App.4th 41, 52 [“We are not required to examine undeveloped claims or to supply arguments for the litigants”].) Ford’s supporting memorandum also lacks the table of contents and table of authorities required by California Rules of Court, rule 3.1113(f).

The sixth cause of action alleges fraudulent inducement of the vehicle purchase through concealment. “The elements of fraudulent concealment are: (1) the defendant concealed or suppressed a material fact; (2) the defendant was under a duty to disclose the fact to the plaintiff; (3) the defendant intentionally concealed or suppressed the fact with the intent to defraud the plaintiff; (4) the plaintiff was unaware of the fact and would not have acted as he or she did if the plaintiff had known of the concealed or suppressed fact; and (5) as a result of the concealment or suppression of the fact, the plaintiff sustained damage.” (Burch v.

CertainTeed Corp. (2019) 34 Cal.App.5th 341, 348 (Burch), citing Bigler-Engler v. Breg, Inc. (2017) 7 Cal.App.5th 276, 310-311 (Bigler-Engler).) “With respect to concealment, there are four circumstances in which nondisclosure or concealment may constitute actionable fraud: (1) when the defendant is in a fiduciary relationship with the plaintiff; (2) when the defendant had exclusive knowledge of material facts not known to the plaintiff; (3) when the defendant actively conceals a material fact from the plaintiff; and (4) when the defendant makes partial representations but also suppresses some material facts.

The latter three circumstances presuppose the existence of some other relationship between the plaintiff and defendant in which a duty to disclose can arise. This relationship has been described as a transaction, such as that between seller and buyer, employer and prospective employee, doctor and patient, or parties entering into any kind of contractual arrangement.” (Id. at pp. 349-350, internal quotations and citations omitted.)

Ford contends that the sixth cause of action is not alleged with sufficient particularity. Each element in a fraud cause of action must generally be pleaded with particularity. (Cadlo v. Owens-Illinois, Inc. (2004) 125 Cal.App.4th 513, 519.) But in the case of fraud by concealment or omission, courts require less particularity because “[h]ow does one show ‘how’ and ‘by what means’ something didn’t happen, or ‘when’ it never happened, or ‘where’ it never happened?” (Alfaro v. Community Housing Improvement System & Planning Ass’n., Inc. (2009) 171 Cal.App.4th 1356, 1384 (Alfaro).)

Less specificity is required when it appears from the nature of the allegations that the defendant necessarily possesses full information concerning the facts of the controversy. (Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal.3d 197, 217 (Committee), superseded by statute on other grounds as stated in Californians for Disability Rights v. Mervyn’s, LLC (2006) 39 Cal.4th 223, 227.)

The complaint alleges that Ford manufactures, distributes, markets, and sells motor vehicles in Santa Clara County, California. (Complaint, ¶ 4.) It alleges Plaintiff entered into a 8

warranty contract with Ford as part of purchasing the vehicle; that Ford knew of the transmission defect prior to Plaintiff acquiring the vehicle and actively concealed it; that Plaintiff would not have purchased the vehicle had he known of the defect; and that Plaintiff has suffered damages in part because the vehicle is now worthless. (Id. at ¶¶ 7, 14, 22, 24, 34 and 35.) The sixth cause of action incorporates those allegations by reference and makes similar allegations. (Id. at ¶¶ 63-78.) At least one appellate court has found similar allegations sufficient to support a cause of action for fraudulent concealment. (Dhital v.

Nissan North America, Inc. (2022) 84 Cal.App.5th 828, 843-844.) Although the Supreme Court initially granted review in Dhital, it subsequently dismissed review, which means Dhital is precedential authority. (Cal. Rules of Court, rule 8.1115(e)(2)).) Dhital is persuasive. All elements of the sixth cause of action are pleaded with adequate specificity.

Ford’s argument that the complaint fails to allege a fiduciary relationship is unpersuasive. No fiduciary relationship is required to support the sixth cause of action. The complaint alleges a direct contractual relationship between Plaintiff and Ford via the warranty agreement attached as exhibit A. “[A]ny kind of contractual relationship” is sufficient to impose a duty to disclose. (Burch, supra, 34 Cal.App.5th at p. 350.) Even if the warranty contract was not enough to give rise to a duty to disclose, in California a “vendor has a duty to disclose material facts not only to immediate purchasers, but also to subsequent purchasers when the vendor has reason to expect that the item will be resold.” (OCM Principal Opportunities Fund, L.P. v.

CIBC World Markets Corp. (2007) 157 Cal.App.4th 835, 859.) As a vehicle manufacturer and distributor, Ford had reason to know that its vehicles are likely to be sold by dealerships to consumers. The duty to disclose as a vendor is therefore triggered.

Finally, Ford argues the sixth cause of action is barred by the economic loss rule. But “the economic loss rule does not apply to limit recovery for intentional tort claims like fraud.” (Rattagan v. Uber Technologies, Inc. (2024) 17 Cal.5th 1, 38.) More specifically, the economic loss rule does not apply to fraudulent inducement of a contract. (Erlich v. Menezes (1999) 21 Cal.4th 543, 552 (Erlich); Robinson Helicopter Co. v. Dana Corp. (2004) 34 Cal.4th 979, 989-990 (Robinson); County of Santa Clara v.

Atlantic Richfield Co. (2006) 137 Cal.App.4th 292, 328-329 [“The analysis [in Robinson] suggested that fraud itself is immune from application of the economic loss rule because fraud is particularly blameworthy and therefore unlike both contract causes of action and products liability causes of action.”], internal citation omitted.) Rattagan concerned fraud alleged to have occurred during a contractual relationship, not fraud in the inducement of a purchase. (Rattagan, at p. 41, fn. 12 [“Rattagan’s tort claims are, of course, based on alleged conduct committed during the contractual relationship but purportedly outside the parties’ chosen rights and obligations.”].)

The Rattagan court made clear it was not addressing fraudulent inducement of contract. Where fraudulent inducement of a contract is alleged, the fraud occurs prior to the formation of the contract and is separate from the contract.

CONCLUSION

Ford’s motion for judgment on the pleadings as to the complaint’s sixth cause of action is denied.

The court will prepare the order.

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Calendar Line 8 Case Name: Eric Wiedemann v. Juggernaut Consulting, LLC et al.