STEINMAN VS. FORD MOTOR COMPANY

than 16 court days before the continued hearing date regarding the parties meet and confer efforts. Should Cross-Complainant file an amended pleading in the time provided under the Court’s ruling on the demurrer, the parties need not comply with this ruling as to this motion.

10. STEINMAN VS. FORD MOTION FOR SUMMARY JUDGMENT AND/OR MOTOR COMPANY ADJUDICATION

Defendant Ford Motor Company’s unopposed Motion for Summary Adjudication is GRANTED.

Ford moves for summary adjudication of the sixth causes of action for fraudulent inducement – concealment.

Legal Standard:

Code of Civil Procedure section 437c(c) provides: “(c) The motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. In determining if the papers show that there is no triable issue as to any material fact, the court shall consider all of the evidence set forth in the papers, except the evidence to which objections have been made and sustained by the court, and all inferences reasonably deducible from the evidence, except summary judgment shall not be granted by the court based on inferences reasonably deducible from the evidence if contradicted by other inferences or evidence that raise a triable issue as to any material fact.

Section 437c(o)-(p) states:

“(o) A cause of action has no merit if either of the following exists: (1) One or more of the elements of the cause of action cannot be separately established, even if that element is separately pleaded. (2) A defendant establishes an affirmative defense to that cause of action. (p) For purposes of motions for summary judgment and summary adjudication: (1) A plaintiff or cross-complainant has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action.

Once the plaintiff or cross- complainant has met that burden, the burden shifts to the defendant or cross-defendant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto. The defendant or cross-defendant shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a

triable issue of material fact exists as to the cause of action or a defense thereto. (2) A defendant or cross-defendant has met his or her burden of showing that a cause of action has no merit if the party has shown that one or more elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense to the cause of action. Once the defendant or crossdefendant has met that burden, the burden shifts to the plaintiff or cross-complainant to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.

The plaintiff or cross-complainant shall not rely upon the allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to the cause of action or a defense thereto.”

“The pleadings define the issues to be considered on a motion for summary judgment. As to each claim as framed by the complaint, the defendant must present facts to negate an essential element or to establish a defense. Only then will the burden shift to the plaintiff to demonstrate the existence of a triable, material issue of fact.” (Scalf v. D.B. LogHomes, Inc. (2005) 128 Cal.App.4th 1510, 1519-1520 [cleaned-up].)

Summary of FAC:

Plaintiff alleges that on or about 3/29/23, he entered into a warranty contract with defendant Ford regarding a 2023 Ford Mustang vehicle (“Subject Vehicle”), which was manufactured and or distributed by Ford. (¶ 10.) Plaintiff purchased the Subject Vehicle from one of Ford’s authorized retail dealerships. (¶ 12.) Thereafter, Plaintiff presented the Subject Vehicle to Ford’s authorized repair facility on at least two occasions with transmission related complaints. (¶¶ 14-16.)

Prior to his purchase of the Subject Vehicle, Ford knew that a Transmission Defect (as that term is defined in the FAC) existed in vehicles equipped with the same 10-speed transmission as the Subject Vehicle. (¶¶ 34, 77.) Despite this knowledge, Ford actively concealed the Transmission Defect from Plaintiff at the time of purchase, repair, and thereafter. (¶¶ 47, 79, 80.) Ford committed fraud by allowing the Subject Vehicle to be sold to Plaintiff without disclosing that the Subject Vehicle and its transmission was defective and susceptible to sudden and premature failure. (¶ 75.)

Ford was under a duty to Plaintiff to disclose the defective nature of the Subject Vehicle and its transmission, its safety consequences and/or the associated repair costs for several reasons. (¶ 81.) In failing to disclose the defects in the Subject Vehicle's transmission, Ford has knowingly and intentionally concealed material facts and breached its duty not to do so. (FAC, ¶ 82.) The concealed facts

were material. (¶ 83.) Had Plaintiff known that the Subject Vehicle suffered from the Transmission Defect, he would not have purchased it or would have paid less for it. (¶¶ 46, 79, 83.) Plaintiff was harmed by purchasing a vehicle that he would not have purchased had he known the true facts about the Transmission Defect. (¶ 87.)

Merits

“[T]he elements of an action for fraud and deceit based on concealment are: (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as he did if he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” (Boschma v. Home Loan Center, Inc. (2011) 198 Cal.App.4th 230, 248 [cleaned up].)

Ford contends Plaintiff cannot establish his fraudulent inducement by concealment claim because he cannot establish Ford had knowledge of a defect at the time of sale; Ford had any transactional relationship triggering any duty to disclose a known defect at the time of sale; damages as a result of Ford’s alleged concealment; and the fraudulent inducement exception to the economic loss rule.

Knowledge of Defect

“Actual fraud consists, among other things, of [t]he suppression of that which is true, by one having knowledge or belief of the fact or [a]ny other act fitted to deceive.” (Boschma, supra, 198 Cal.App.4th at p. 248.)

The undisputed material facts establish Plaintiff has no evidence to prove Ford had knowledge of the Transmission Defect in the Subject Vehicle before Plaintiff purchased it. (See UMF 18-24.) For example, Plaintiff produced all documents supporting his claims yet none show Ford’s pre-sale knowledge of the Transmission Defect in the Subject Vehicle. (UMF 18-20.) As another example, in response to Ford’s interrogatory requesting that Plaintiff state “all material facts that YOU allege Ford had exclusive knowledge of and failed to disclose prior to YOUR lease or purchase of the VEHICLE[,]” Plaintiff merely restated that Ford “knew” of a purported transmission defect, failed to disclose it to Plaintiff, and cited three publicly available technical service bulletins (“TSBs”) issued in March 2018, September 2018, and September 2021 relating to some 2017 and 2018 F-150 vehicles, even though the Subject Vehicle is a 2023 Mustang Mach 1. (UMF 21.)

Plaintiff produced no evidence

establishing that these TSBs applied to the Subject Vehicle, demonstrate a defect or show that Ford had knowledge of any defect in the Subject Vehicle at the time of sale. (UMF 22.) Therefore, Ford has met its initial burden regarding knowledge.

Damages

Civil Code section 3343, section (a) provides, in relevant part:

“(a) One defrauded in the purchase, sale or exchange of property is entitled to recover the difference between the actual value of that with which the defrauded person parted and the actual value of that which he received, together with any additional damage arising from the particular transaction, including any of the following: (1) Amounts actually and reasonably expended in reliance upon the fraud. (2) An amount which would compensate the defrauded party for loss of use and enjoyment of the property to the extent that any such loss was proximately caused by the fraud.” (Civ. Code, § 3343, subd. (a)(1), (2).)

Thus, in fraud cases involving “the purchase, sale or exchange of property,” the out-of-pocket measure of damages applies. (Alliance Mortgage Co. v. Rothwell (1995) 10 Cal.4th 1226, 1240–1241, citing Civ. Code, § 3343, subd. (a) [footnote omitted].) As used in the statute, “actual value” means the market value of the property at the time of the purchase. (Nece v. Bennett (1963) 212 Cal.App.2d 494, 497-498 [reversing trial court judgment and remanding for new trial after finding the plaintiffs failed to their fraud by concealment claim because there was no substantial evidence to prove the market value of the property at the time of the purchase].)

The undisputed material facts establish Plaintiff does not allege or claim any personal injury or damage to property other than the vehicle itself and instead seeks only economic losses. (UMF 6-7.) The undisputed material facts also establish Plaintiff has no evidence to prove he sustained damages as a result of the alleged concealment. (UMF 8-17.) Therefore, Ford has met its initial burden regarding damages.

Plaintiff has not filed an opposition and, therefore, has not met his burden of establishing any triable issues of material fact.

Because Ford has established Plaintiff cannot establish at least two elements of his fraud claim, the court need not address Ford’s remaining arguments. The motion is granted.

Defendant to give notice.