GREER’S CONTRACTING AND CONCRETE, INC. VS CAREY

1. CASE # CASE NAME HEARING NAME GREER'S CONTRACTING CVSW2404655 AND CONCRETE, INC. DEMURRER ON CROSS-COMPLAINT VS CAREY Tentative Ruling: Demurrer overruled on the Sixth and Eighth Causes of Action. Demurrer is Sustained to the Ninth Cause of Action without leave to amend. Cross Defendant to respond within 20 days.

Meet and Confer - CCP § 430.41(a) provides that “[b]efore 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 for the purpose of determining whether an agreement can be reached that would resolve the objections to be raised in the demurrer.” The demurring party must file and serve with the demurrer a declaration stating the means by which the demurring party met and conferred, and that the parties did not reach an agreement resolving the objections raised in the demurrer. (CCP § 430.41(a)(3).)

Counsel for GCC asserts that beginning February 2026, he attempted to meet and confer with Careys’ counsel on at least four occasions via email and telephone voice messages. (Decl. fo Diefenbach, ¶ 3 and 4.) The emails and phone calls were not returned. (Id at ¶ 5.) Because GCC attempted to meet and confer by telephone, this satisfies the meet and confer requirement.

Standard - A party may object by demurrer to a complaint on grounds that the pleading does not state facts sufficient to constitute a cause of action. (Cal. Code Civ. Pro. §430.10(e).) For the purposes of a demurrer, the allegations in the complaint must be accepted as true. (Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 604.) “In short, the ruling on a demurrer determines a legal issue on the basis of assumed facts, i.e., all those material, issuable facts properly pleaded in the complaint, regardless of whether they ultimately prove to be true.” (State of California ex rel.

Bowen v. Bank of America Corp. (2005) 126 Cal. App. 4th 225, 240.) “To survive a demurrer, the complaint need only allege facts sufficient to state a cause of action; each evidentiary fact that might eventually form part of the plaintiff's proof need not be alleged.” (C.A. v. Williams S. Hart Union High School Dist. (2012) 53 Cal. 4th 861.)

Sixth Cause of Action for Breach of Implied Covenants of Good Faith and Fair Dealing - “The covenant of good faith and fair dealing, implied by law in every contract, exists merely to prevent one contracting party from unfairly frustrating the other party’s right to receive the benefits of the agreement actually made.” (Guz v. Bechtel National, Inc. (2000) 24 Cal. 4th 317, 349-350.) The implication must arise from the language of the contract or be indispensable to effectual the intention of the parties. (Third Story Music, Inc. v. Waits (1995) 41 Cal. App. 4th 798, 804.) “A party violates the covenant if it subjectively lacks belief in the validity of its act or if its conduct is objectively unreasonable.” (Moore v. Wells Fargo Bank, N.A. (2019) 39 Cal. App. 5th 280, 291.)

GCC argues that the sixth cause of action is barred by the economic loss rule. An omission to perform a contract obligation is never a tort, unless that omission is also an omission of a legal duty.” (Erlich v. Menezes (1999) 21 Cal. 4th 543, 551.) The

economic loss rule bars “a plaintiff’s tort recovery of economic damages unless such damages are accompanied by some form of physical harm (i.e. personal injury or property damage.)” (North American Chemical Co. v. Superior Court (1997) 59 Cal.App.4th 764, 777.) However, the rule does not apply where the conduct amounting to a breach of contract also violates a duty independent of the contract constituting a tort. (Erlich, supra, 21 Cal. 4th at 551.) A tortious breach of contract may be found when the breach is accompanied by a traditional common law tort, such as fraud or conversion. (Robinson Helicopter Co. v. Dana Corp. (2004) 34 Cal. 4th 979, 990.) In such cases, the duty that gives rise to tort liability is either completely independent of the contract or arises from conduct which is both intentional and intended to harm. (Id.)

As stated, the implied covenant creates a duty to act in good faith and deal fairly in the performance of contract, which may be independent from the breach of the contract. Thus, breach of covenant claims are not barred by the economic loss rule. Here, the Careys allege that GCC breached this duty by failing to complete work in a workmanlike manner, employing unlicensed laborers, covering up construction defects, charging for work and materials that were already included in the contract, plans and specifications and representing the Careys did not pay for work. (XComp, ¶71.)

This is sufficient to state a cause of action for breach of implied covenants. GCC argues that the Careys may only recover contract damages. “The failure to deal fairly or in good faith gives rise to an action for damages.” (Moore, supra, 39 Cal. App. 5th at 291.) Because the breach of the implied covenants is a contract concept, such claims generally lead to the imposition of contract damages rather than tort damages. (Foley v. Interactive Data Corp. (1988) 47 Cal. 3d 654, 684.) However, the amount or type of damages is not a proper subject for demurrer because “a demurrer must dispose of an entire cause of action to be sustained.” (Fremont Indemnity Co. v.

Fremont General Corp. (2007) 148 Cal.App.4th 97, 119.) Accordingly, the Demurrer is overruled.

Eighth Cause of Action for Violation of Penal Code §496 - “Every person who buys or receives any property that has been stolen or that has been obtained in any manner constituting theft or extortion, knowing the property to be so stolen or obtained, or who conceals, sells, withholds, or aids in concealing, selling, or withholding any property from the owner, knowing the property to be so stolen or obtained, shall be punished by imprisonment in a county jail for not more than one year, or imprisonment.” (Pen.

Code §496(a).) Any person who has been injured by a violation of subdivision (a) may bring an action for three times the amount of actual damages, if any, sustained by the plaintiff, costs of suit, and reasonable attorney’s fees. (Pen. Code §496(c).) “While section 496(a) covers a spectrum of impermissible activity relating to stolen property, the elements required to show a violation of section 496(a) are simply that (i) property was stolen or obtained in a manner constituting theft, (ii) the defendant knew the property was so stolen or obtained, and (iii) the defendant received or had possession of the stolen property.” (Switzer v.

Wood (2019) 35 Cal. App. 5th 116, 126.) An essential element of a section 496 violation is the defendant’s knowledge that the property was stolen. (Lacagnina v. Comprehend Systems, Inc. (2018) 25 Cal. App. 5th 955, 971.)

Section 496 applies to theft by false pretense, which involves knowingly and designedly defrauding a person of money, labor or property by false or fraudulent representations or pretense. (Bell v. Feibush (2013) 212 Cal. App. 4th 1041, 1048.) However, “to prove theft, a plaintiff must establish criminal intent of the party of the defendant beyond mere

proof of nonperformance or actual falsity,” which “prevents ordinary commercial defaults from being transformed into a theft.” (Siry Investment, L.P. v. Farkhondehpour (2022) 13 Cal. 5th 333, 361-362.) Thus, not all disputes alleging that a defendant obtained money through fraud will amount to a theft under Penal Code § 496. (Id at 361.)

The Careys allege that Cross-Defendants, including GCC, knowingly and willfully conspired to breach their contractual duties by fraudulently diverting cash distributions for the payment of unlicensed work in violation of CSLL and construction statutes. (XComp, ¶ 93.) The claim that the fraud was the result of careful planning and deliberation reflecting criminal intent. (Ibid.) While these allegations seem specious, they must be accepted as true for the purpose of the demurrer. Arguably, the Careys have stated sufficient facts to constitute a cause of action. The demurrer is overruled.

Ninth Cause of Action for Declaratory Relief - Pursuant to CCP §1060, any person under a written instrument who desires a declaration of his or her rights or duties with respect to another, may, in cases of actual controversy relating to the legal rights and duties of the respective parties, bring an action or cross-complaint in the superior court for a declaration of his or her rights or duties. The purpose of declaratory relief is to eliminate uncertainties and controversies that may result in future litigation. (Marina Development Co. v.

County of Los Angeles (1984) 155 Cal.App.3d 435, 443.) To demonstrate entitlement to declaratory relief, a plaintiff must show that the action presents “two essential elements: (1) a proper subject of declaratory relief, and (2) an actual controversy involving justiciable questions relating to the rights or obligations of a party.” (Lee v. Silveira (2016) 6 Cal.App.5th 527, 546.) An actual controversy “encompasses a probable future controversy relating to the legal rights and duties of the parties. [Citation].

It does not embrace controversies that are conjectural, anticipated to occur in the future, or an attempt to obtain an advisory opinion from the court.” (Ibid; see also City of Cotati v. Cashman (2002) 29 Cal.4th 69, 79.)

Where there is an accrued cause of action for breach of contract, declaratory relief may be denied. (Baldwin v. Marina City Properties, Inc. (1978) 79 Cal. App. 3d 393, 407.) “The declaratory relief statute should not be used for the purpose of anticipating and determining an issue which can be determined in the main action. The object of the statute is to afford a new form of relief where needed and not to furnish a litigant with a second cause of action for the determination of identical issues.” (Hood v. Superior Court (1995) 33 Cal. App. 4th 319, 324.)

The Careys assert that an actual controversy exists between Cross-Complainants and Cross-Defendants concerning their respective rights and duties in that they maintain that representations made by GCC were false and that GCC hired unlicensed workers who were not covered under GCC’s CSLB License, in violation of Bus & Prof. Code sections 7031, 7125.2, 7159, 7160 and 7161. (XComp., ¶102.) The Careys seek a judicial declaration in order to ascertain their rights and duties under the written Construction Contract, liability for their injuries responsibility for the cost to repair their construction related damages and damages for fraud and misrepresentation and finally liability under the Contractor's License Bond issued by Cross-Defendant Hudson. (XComp., ¶105.)

Thus, it appears that the ninth cause of action is duplicative of the substantive causes of action. Moreover, declaratory relief is not appropriate to remedy past wrongs. (California Insurance Guarantee Assn. v. Superior Court (1991) 231

Cal.App. 3d 1617.) “If there is a controversy which calls for a declaration of rights, it is no objection that past wrongs are also to be redressed; but there is no basis for declaratory relief where only past wrongs are involved.” (Baldwin v. Marina City Properties, Inc. (1978) 79 Cal. App. 3d 393, 407.) Here, it appears that the allegations regarding misrepresentations and the use of unlicensed laborers are based entirely on past wrongs. The demurrer is sustained without leave to amend.

2. CASE # CASE NAME HEARING NAME KING-STEELE VS HEARING ON PRELIMINARY CVME2608128 COUNTY OF RIVERSIDE INJUNCTION Tentative Ruling: Hearing Required.

3. CASE # CASE NAME HEARING NAME MOTION TO COMPEL: DANKO RESTAURANT CVME2507574 ANSWER/RESPONSE TO PRODUCTION GROUP, INC VS PATTAH OF DOCUMENTS Tentative Ruling: Motion is continued until November 25, 2026 at 8:30 am M301. Both parties are required to submit a declaration at least 10 days before the next hearing detailing compliance with the meet and confer requirements and addressing the Court’s concerns with the responses.

Pursuant to CCP §2031.010, a party may demand that any other party produce and inspect a document that is in the possession of another party. The demanding party must designate documents by specifically describing individual items or reasonably particularizing categories of documents. (CCP §2031.030(c)(1).) The responding party must respond to each request by either a statement that the party will comply, a representation that the party is unable to comply or an objection. (CCP §2031.210(a)(1)- (3).)

A demanding party may move for an order compelling further responses to a demand for inspection if the party determines that the statement of compliance or representation of inability to comply is incomplete or if an objection is without merit. (CCP §2031.310(a)(1)-(3).) A moving party must establish good cause justifying discovery. (CCP §2031.310(b)(1).) To establish good cause, the moving party must demonstrate relevance and facts justifying discovery. (Kirkland v. Superior Court (2002) 95 Cal.App.4th 92, 98.)

Once good cause is established, the responding party has the burden to justify any objections. (Ibid.)

Meet and Confer - A motion to compel a further response to an inspection demand or interrogatory must be accompanied by a declaration stating facts showing a “reasonable and good faith attempt” to resolve informally the issues presented by the motion before filing the motion. (CCP §§ 2031.310(b)(2); 2030.300(b).) “This rule is designed to encourage the parties to work out their differences informally so as to avoid the necessity for a formal order.” (Townsend v. Superior Court (1998) 61 Cal. App. 4th 1431, 1435.) The level of effort necessary to satisfy the requirement varies depending on the circumstances of the case, but a serious effort is required. (Stewart v. Colonial Western Agency, Inc. (2001) 87 Cal.App.4th 1006, 1016.) Whether a “reasonable and good faith attempt” was made requires an “evaluation of whether, from the perspective