Joy C&C LLC v. Yang

Austin and Layla are only alleged to be residents on the property. (Id. at ¶¶ 2, 3.) It is unclear how Austin or Layla have any ownership rights to the property under the alleged contract, or how they were harmed by the breach of contract, fraudulent concealment, or any of the other alleged wrongful acts of plaintiff/crossdefendants. The cross-complaint is also vague and ambiguous with regard to the contract or contracts that are being alleged, what the terms of the contracts are, who

1 The court will refer to cross-complainants by their first names for clarity and brevity, as they all

share the same last name. No disrespect is intended. 3

the parties to the contracts are, how the contracts were breached, and who was harmed by the breach. Cross-complainants also vaguely allege their claims against three different cross-defendants without alleging which cross-defendants committed which wrongful acts. Therefore, the entire cross-complaint is vague and uncertain.

First Cause of Action: Next, the first cause of action for quiet title fails to state a valid cause of action. While John seeks to quiet title to the property, he admits that he has only a 20% interest in the property, which is consistent with the allegations of plaintiff’s complaint, which alleges that plaintiff has an 80% interest and John has a 20% interest in the property. (Compare Cross-Complaint, ¶¶ 1, 28 and Complaint, ¶ 4.) Thus, the crosscomplaint is ambiguous and fails to state any facts showing that John is entitled to quiet title when he admits that he has only a 20% interest in the property and he seems to admit that plaintiff is not seeking to challenge his 20% interest in the property.

John seems to be alleging that he has a 50% interest in the property because the short-form deed of trust/assignment of rents states that there is a “80%/20% joint tenancy”, which is inconsistent with Civil Code section 683(a), which requires equal shares for a joint tenancy. Therefore, John alleges that the parties own a tenancy in common and have equal shares of the property. (Cross-complaint, ¶ 13.) However, he also alleges inconsistently that he owns an undivided 20% interest in the real property. (Id. at ¶¶ 1, 28.) It is unclear what adverse interest John is alleging that plaintiff has asserted, as they both seem to agree that plaintiff has an 80% interest and John has a 20% interest in the property.

Also, John’s apparent allegation that the parties must automatically own equal interests in the property because the title states that there is a joint tenancy is incorrect, as the parties may agree to an unequal division of the property and pay unequal amounts to purchase the property even if the title is held in a “joint tenancy”. (Kershman v. Kershman (1961) 192 Cal.App.2d 23, 26-27.) Here, John concedes that he owns a 20% interest in the property, and he seems to be alleging that he only paid $35,000 toward the purchase price for the property (Cross-Complaint, ¶ 9), which is inconsistent with his apparent allegation that he owns a 50% interest in the property. Therefore, the first cause of action is uncertain and fails to state a cause of action for quiet title.

Second Cause of Action: The second cause of action for cancellation of instruments under Civil Code section 3412 also fails to state a claim and is uncertain. Under Civil Code section 33412, “A written instrument, in respect to which there is a reasonable apprehension that if left outstanding it may cause serious injury to a person against whom it is void or voidable, may, upon his application, be so adjudged, and ordered to be delivered up or canceled.” (Civ. Code, § 3412.)

Here, cross-complainants assert that the short-form deed of trust and assignment of rents and other encumbrances recorded by cross-defendants are void or voidable, as they were allegedly recorded without a legal description and without trustor execution/acknowledgement, and they were recorded during the periods when crossdefendant Joy C&C LLC was suspended as a corporation. (Cross-Complaint, ¶ 32.) They also claim that the ownership recordings and deeds showing an 80% ownership are also void or voidable. (Ibid.) They allege that the instruments are causing them serious injury

by clouding title and impairing alienability, and therefore they should be cancelled or expunged. (Ibid.)

Again, however, Austin and Layla admit that they have no ownership interest in the property, so they have no standing to seek to cancel or expunge the deed of trust and assignment of rents or other deeds based on any alleged flaws in those instruments. Nor is it clear how John could have been injured by the recording of the instruments, which he admits show that he has a 20% interest in the property. While he claims that the instruments created a cloud on his title, he also alleges that he is the 20% owner of the property based on the same instruments.

His allegations of being harmed by the deed and assignment of rents are inconsistent with his own admission that his ownership is based on the same instruments. If he succeeds in voiding the instruments, it would effectively destroy any ownership interest he has in the property, so his allegation that the instruments are harming him makes no sense.

Also, contrary to the allegations of the cross-complaint, the recorded short form deed of trust and assignment of rents includes a legal description and the notarized signatures of John Yang and Cindy Cha, representative of Joy C&C LLC. (Cross- Complainants’ Request for Judicial Notice, Exhibit C. The court will take judicial notice of the recorded deed of trust and assignment of rents for the property.) In addition, crossdefendant Joy C&C LLC is not a suspended corporation, and therefore cross-complaint’s allegation that the instruments are void because Joy C&C is a suspended corporation is inconsistent with judicially noticeable facts. (Cross-Defendants’ Request for Judicial Notice, Exhibit C.

The court will take judicial notice of the Secretary of State’s certificate of status for Joy C&C.) Therefore, the second cause of action is uncertain and fails to state a claim for cancellation of the instruments.

Third Cause of Action: The third cause of action is also uncertain and fails to state a claim. Cross-complainants allege that they are entitled to declaratory relief with regard to the “REI Contract (no AOR clause)”, that Joy LLC lacks contractual standing absent assignments/novation/merger, that John holds at least a 20% legal/equitable interest, that “the recorded AOR/DOT lacks a legal description and trustor execution and is therefore unenforceable and non-notice as to the Property”, that acts during the suspension of Joy C&C’s suspension are voidable, that the unlawful detainer is nonpreclusive as to title ownership, and that “the 10/29/2021 memo reflects 24 months prepaid credit that must be applied/offset.” (Cross-Complaint, ¶ 34.)

These allegations are vague and confusing, and do not show that cross-complainants are entitled to a declaration regarding their rights under the contracts or other instruments.

As discussed above, there does not appear to be any real dispute between the parties that John owns a 20% interest in the property. The allegation that Joy C&C lacks standing is inconsistent with the contract language. Likewise, the recorded deed of trust and assignment of rents does include a legal description and was executed by the parties, as shown in the recorded deed of trust. In addition, while cross-complainants allege that Joy C&C was suspended and thus the instruments are void or voidable, the judicially noticeable records of the Secretary of State show that Joy C&C LLC is in good standing. Since cross-complainants have not alleged any facts showing the existence of an actual controversy regarding their rights and duties under the agreements, they have not stated a claim for declaratory relief. 5

Fourth Cause of Action: Next, the fourth cause of action for breach of contract fails to state a valid cause of action and is uncertain. The elements of a cause of action for breach of contract are (1) a contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) resulting damages. (D'Arrigo Bros. of California v. United Farmworkers of America (2014) 224 Cal.App.4th 790, 800.)

Here, the cross-complaint alleges the existence of an agreement formed on October 29, 2021. However, cross-complainants do not allege the subject matter of the agreement, its terms, or what the duties of the parties were under the agreement. The cross-complaint does refer to the “Residential Lease Agreement”, attached as Exhibit B to the compendium of exhibits to the cross-complaint. (Cross-Complaint, ¶ 36, and Exhibit B to Compendium of Exhibits to Cross-Complaint.) Cross-complainants also allege that plaintiff only credited $30,000 of the $35,000 they paid under the agreement, and refused to account for payments. (Ibid.)

Cross-complainants also vaguely allege that plaintiff recorded adverse instruments inconsistent with the agreement, but they do not allege what documents plaintiff recorded or how they were inconsistent with the agreement. (Ibid.) They allege they lost equity and incurred title-clearing costs, but it is not clear how much damages they actually suffered. (Ibid.) They also allege that plaintiff filed an unlawful detainer action to demand additional sums and thus caused additional damages. (Id. at ¶ 37.)

Again, however, it is unclear what additional damages they suffered from the filing of the unlawful detainer case.

If parties only entered into a lease agreement, it is unclear how cross-complainants could have lost equity in the property. It appears that cross-complainants may be alleging some type of lease-to-own agreement existed, but they allege no facts showing what the terms of the agreement were, that they performed under the agreement, or how plaintiff breached the agreement and caused them damages. Therefore, the breach of contract claim is uncertain and fails to state facts sufficient to constitute a valid cause of action.

Fifth Cause of Action: The fifth cause of action for breach of the implied covenant of good faith and fair dealing is also uncertain and fails to state a valid cause of action. Cross-complainants allege that plaintiff frustrated the contractual benefits by declining for years to invoice or credit payments, mis-recorded an assignment of rents without contractual foundation, targeted a non-signer in the unlawful detainer action, and attempted to transform non-collection into forfeiture. (Id. at ¶ 39.) Plaintiff also allegedly demanded amounts already prepaid, refused to ledger credits, and used the unlawful detainer case to coerce concessions, thus unreasonably interfering with crosscomplainants’ contractual benefits. (Id. at ¶ 40.)

“Implied in every contract is a covenant of good faith and fair dealing. The implied covenant prevents one side from unfairly frustrating the other's right to receive the benefits of the agreement actually made. The covenant does not impose substantive terms beyond those of the contract. A plaintiff claiming breach must allege the defendant's wrongful conduct was contrary to the contract's purpose and the parties’ legitimate expectations.” (Cordoba Corp. v. City of Industry (2023) 87 Cal.App.5th 145, 156, citations omitted.)

Here, since cross-complainants have not alleged facts to support their breach of contract claim, or even clearly alleged what the nature of the contract was and how plaintiff breached it, they also have not stated a valid claim for breach of the implied covenant. Without clear allegations regarding the nature and terms of the underlying contract, there is no way for cross-complainants to state a claim for breach of the implied covenant, as they cannot show that plaintiff frustrated the purpose of the contract and the parties’ expectations under the contract if they have not alleged what the contract’s purpose was. Therefore, the court intends to sustain the demurrer to the fifth cause of action for uncertainty and failure to state facts sufficient to constitute a cause of action.

Sixth Cause of Action: The sixth cause of action for accounting, constructive trust, and unjust enrichment is also vague and does not state a claim. Cross-complainants vaguely allege that there are complex accounts among the parties (taxes, insurance, mortgage, necessary repairs, improvements, occupancy credits/charges) that require an accounting. (Cross-Complaint, ¶ 42.) “The Property and related proceeds form a res subject to a constructive trust/equitable lien in at least $35,000 (or, at minimum, $30,000 credited), plus lawful interest, with set-offs for the ’24 months’ prepaid term.” (Ibid.) Crosscomplainants request that the court impose a constructive trust/equitable lien to secure credits for the $35,000 inception payment and require set-offs against any rent/damages claims encompassed by the “24 months” prepaid term. (Id. at ¶ 43.)

It is unclear what cross-complainants are attempting to allege here. They appear to be asserting that the plaintiff failed to properly account for a $35,000 payment made either for rent or to purchase part of the property, but without clearly alleging the terms of the underlying agreement, it is difficult to understand what the nature of the payment was or how it was to be credited. They also seem to allege that they paid money to repair or maintain the property, but again the allegations are so vague and confusing that it is impossible to determine exactly what payments were made or what their purpose was.

Also, it is unclear why Austin and Layla would have any right to an accounting or constructive trust, as they admit they are only residents on the property and apparently do not assert any ownership rights. Therefore, the court intends to sustain the demurrer to the sixth cause of action for uncertainty and failure to state facts sufficient to state a cause of action.

Seventh Cause of Action: The seventh cause of action seeks to set aside the judgment in the unlawful detainer case. Cross-complainants allege that the unlawful detainer judgment was obtained through fraud and concealment, including misidentifying the operative agreement, serving three-day notices naming Austin, Layla, and John while suing only Austin, attaching inconsistent lease forms, and concealing capacity defects. (Cross-Complaint, ¶ 45.) Cross-complainants also allege that they possess meritorious defenses, including a “recorded 20%, wrong entity, no AOR clause, non-collection”, and that there is no adequate remedy at law because UD does not adjudicate title. (Ibid.)

However, cross-complainants have not alleged any facts showing that they are entitled to equitable relief from the judgment in the unlawful detainer case. They allege only vague conclusions of fraud and concealment, without any supporting facts showing that they were actually misled into agreeing to a stipulated judgment in the UD case. Also, the court notes that the UD judgment was entered on April 2, 2024, which is over a 7

year and a half before cross-complainants filed their cross-complaint in December of 2025. (The court will take judicial notice of the stipulated judgment filed in case no. 24CEL01675 on April 2, 2024.) Therefore, it appears that any action to set aside the judgment may be untimely. In any event, the seventh cause of action is uncertain and fails to state facts sufficient to state a claim, so the court intends to sustain the demurrer as to the cause of action.

Eighth Cause of Action: The eighth cause of action for rescission and restitution is also uncertain and fails to state a claim. The eighth cause of action has been brought by Austin only with regard to the stipulated UD judgment. Austin claims that he is rescinding the settlement “for fraud, concealment, illegality (capacity defects) and failure of consideration, and seeks restitution and related equitable relief.” (Cross- Complaint, ¶ 47.) Again, however, cross-complainants allege no facts showing how the UD judgment and settlement were obtained by fraud, concealment, or illegality.

Nor have they alleged any facts showing that there was a failure of consideration. There are also no facts alleged showing why Austin is entitled to any restitution or other relief. Crosscomplainants allege only conclusions, not facts, so they have not stated a valid claim for rescission or restitution. Therefore, the court intends to sustain the demurrer to the eighth cause of action.

Ninth Cause of Action: The ninth cause of action for fraudulent concealment is also uncertain and fails to state a cause of action. “The required elements for fraudulent concealment are (1) concealment or suppression of a material fact; (2) by a defendant with a duty to disclose the fact to the plaintiff; (3) the defendant intended to defraud the plaintiff by intentionally concealing or suppressing the fact; (4) the plaintiff was unaware of the fact and would not have acted as he or she did if he or she had known of the concealed or suppressed fact; and (5) plaintiff sustained damage as a result of the concealment or suppression of the fact.” (Graham v. Bank of America, N.A. (2014) 226 Cal.App.4th 594, 606, citation omitted.)

“Fraud must be pleaded with specificity rather than with ‘“‘general and conclusory allegations.’”’ The specificity requirement means a plaintiff must allege facts showing how, when, where, to whom, and by what means the representations were made, and, in the case of a corporate defendant, the plaintiff must allege the names of the persons who made the representations, their authority to speak on behalf of the corporation, to whom they spoke, what they said or wrote, and when the representation was made.” (West v.

JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 793, citations omitted.) Here, the cross-complaint alleges only vague conclusions, not specific facts to support the elements of the fraud claim. Cross-complainants allege “Who: Cha and JOY LLC. What concealed: SOS/FTB suspension; absence of any AOR term in the executed REI Contract; wrong-entity recordings; invalid ‘joint tenancy’ recital; insider title flips; and the source/character of John's $35,000. When/Where: negotiations from 2021 onward and during the UD.

Duty: arising from partial representations, exclusive knowledge, and statutory capacity rules. Reliance: Austin's UD settlement and the Yang family's continued performance. Damages: clouded title, costs, and lost equity growth. Punitive damages are warranted against Cha for malice, oppression, and fraud.” (Cross-Complaint, ¶ 49.)

These vague allegations do not contain any specific facts showing exactly what was concealed, when it was concealed, or how cross-complainants would have acted differently if they had known the truth. Cross-complainants seem to be alleging that plaintiff concealed facts regarding the property or payments to purchase the property, but the allegations are too vague to clarify what facts were concealed or how they affected cross-complainants. They also seem to be alleging concealments regarding the UD proceeding, but again it is not clear what facts plaintiffs concealed or how they damaged cross-complainants.

They appear to allege that they relied on the concealed facts by entering into the UD settlement and continuing to perform under the agreement, but it is not clear how they were damaged by any concealment, as they apparently continue to reside in the property. Therefore, the court intends to sustain the demurrer to the ninth cause of action for fraudulent concealment.

Tenth Cause of Action: The court will also sustain the demurrer to the tenth cause of action for abuse of process. “The common law tort of abuse of process arises when one uses the court's process for a purpose other than that for which the process was designed. It has been ‘interpreted broadly to encompass the entire range of “procedures” incident to litigation.’ [¶] ‘[T]he essence of the tort [is] ... misuse of the power of the court; it is an act done in the name of the court and under its authority for the purpose of perpetrating an injustice.’ To succeed in an action for abuse of process, a litigant must establish that the defendant (1) contemplated an ulterior motive in using the process, and (2) committed a willful act in the use of the process not proper in the regular conduct of the proceedings.” (Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1056–1057, citations omitted.)

Here, cross-complainants allege that “Cross-Defendants used unlawful detainer and partition procedures not to fairly resolve possession or partition, but to coerce title concessions, chill testimony, and create reputational harm to family members who are key witnesses. (Exh. F.)” (Cross-Complaint, ¶ 51.) “The institution of successive meritless proceedings against non-signatory family members (Austin and Layla) was an improper and ulterior use of the judicial process intended to intimidate, discredit, and silence witnesses in connection with the disputed ownership and cash consideration.” (Id. at ¶ 52.) “As a direct and proximate result, Austin and Layla suffered damages, including emotional distress, reputational harm, attorney's fees and costs to defend meritless actions, and other special damages according to proof.

Punitive damages are warranted to deter similar misconduct.” (Id. at ¶ 53.) “Cross-Defendants continue to brandish the UD judgment to pressure Cross-Complainants, demand money already prepaid, and discredit Austin and Layla as witnesses, causing ongoing economic and noneconomic damages. (Exh. F.)” (Id. at ¶ 54.) “Cross-Defendants' refusal to credit the 24-month prepaid rent while invoking the UD constitutes a double-recovery scheme and a willful misuse of process to obtain collateral objectives unrelated to fair adjudication. (Exhs.

F, G-l.)” (Id. at ¶ 55.)

However, these vague allegations fail to state any facts showing that plaintiff intentionally abused the court process by using court procedures for an illegal purpose. There are no facts alleged that tend to show that plaintiff had an improper purpose in instituting either the UD or the present partition actions, or that cross-complainants were actually damaged by the institution and prosecution of the actions. Therefore, the court

intends to sustain the demurrer to the tenth cause of action for uncertainty and failure to state facts sufficient to constitute a cause of action.

Eleventh Cause of Action: The court will also sustain the demurrer to the eleventh cause of action for slander of title. “To establish slander of title, a plaintiff must show: ‘(1) a publication, (2) which is without privilege or justification, (3) which is false, and (4) which causes direct and immediate pecuniary loss.’” (Klem v. Access Ins. Co. (2017) 17 Cal.App.5th 595, 612, citation omitted.)

Here, cross-complainants allege that “Cross-Defendants published false statements and recorded instruments asserting ownership or AOR rights without privilege and with malice or reckless disregard, causing special damages including attorney's fees, title-clearing costs, and impaired marketability. (Exhs. C, D.)” (Cross-Complaint, ¶ 57.)

However, cross-complainants allege no facts showing that plaintiff published any documents that were false and unprivileged, and that caused them to suffer any harm. Cross-complainants admit that John has only a 20% interest in the property, which is what the short-form deed of trust and assignment of rents shows. (Exhibit C to Compendium of Exhibits.) Thus, cross-complainants’ own exhibits show that the title documents published by plaintiff are true. It is not clear how the publication harmed crosscomplainants either, as the documents accurately reflect John’s share of the property and the other two cross-complainants admit that they do not own any share in the property. Therefore, the court intends to sustain the demurrer to the eleventh cause of action for uncertainty and failure to state a claim.

Twelfth Cause of Action: Next, the twelfth cause of action attempts to state a claim for injunctive relief. Cross-complainants request that the court restrain further transfers, encumbrances, or changes to possession while the case is pending. However, they allege no facts showing that they will suffer any irreparable harm if injunctive relief is not granted, or that they are likely to prevail on the merits of any of their claims. (Integrated Dynamic Solutions, Inc. v. VitaVet Labs, Inc. (2016) 6 Cal.App.5th 1178, 1183.) Thus, they have not stated a claim for injunctive relief, and the court intends to sustain the demurrer to the twelfth cause of action.

Thirteenth Cause of Action: The thirteenth cause of action simply states that crosscomplainants reserve their right to amend the cross-complaint as discovery reveals the true legal status, formation, and ownership of Joy C&C LLC, including substituting true names and capacities and asserting additional claims such as malicious prosecution upon favorable termination of the UD case. (Cross-Complaint, ¶ 60.) However, there is no cause of action for “reservation of the right to amend.” If cross-complainants wish to amend their cross-complaint, they will need to follow the statutory procedures for doing so. Therefore, the court intends to sustain the demurrer to the thirteenth cause of action for failure to state a claim, without leave to amend.

Fourteenth Cause of Action: Next, the fourteenth cause of action is for “Evidentiary Foundations; Self-Authentication; and Requests for Judicial Notice.” This “cause of action” is nonsensical and fails to state any recognizable claim. To the extent that crosscomplainants wish to lodge certified copies of recorded instruments or request judicial notice of documents, they may file separate requests with the court. However, they have 10

not and cannot state a claim based on such requests. Therefore, the court intends to sustain the demurrer to the fourteenth cause of action for failure to state a claim, without leave to amend.

Leave to Amend: Finally, the court will grant leave to amend as to the first through twelfth causes of action, as it is possible that cross-complainants might be able to allege more facts to state valid claims. However, it intends to deny leave to amend as to the thirteenth and fourteenth causes of action, which are not valid causes of action.

Motion to Strike: The court intends to deny the motion to strike in its entirety, as it is moot in light of the fact that the court intends to sustain the demurrer to the entire crosscomplaint.

Pursuant to California Rules of Court, rule 3.1312(a), and Code of Civil Procedure section 1019.5, subdivision (a), no further written order is necessary. The minute order adopting this tentative ruling will serve as the order of the court and service by the clerk will constitute notice of the order.

Tentative Ruling

Issued By: KCK on 05/18/26. (Judge’s initials) (Date)

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