aska Sakan, Inc. vs. Yorba Cw, Inc.

Opposition

Cal. Super. - 4th Dist.November 2, 2015

cw N N Wn Bs Oo 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Adam I. Miller (SBN 269990) Mathieu H. Putterman (SBN 306845) MILLER MILLER GERBER LLP 18301 Von Karman Avenue, Suite 950 Irvine, CA 92612 (714) 450-3800 Phone (714) 450-3801 Facsimile amiller@mmeg-llp.com Attorneys for Plaintiffs, Aska Sakan, Inc., a California corporation; and Abdurrezag Kaal, an individual Ca fe S pen irC o By Ck D ep t Cl ELE CTR ONI CAL LY FLED par r Cout o Cal f, Cour y o f Or ing Sa SUPERIOR COURT OF THE STATE OF CALIFORNIA, COUNTY OF ORANGE CENTRAL JUSTICE CENTER - UNLIMITED Aska Sakan, Inc., a California Corporation; and | Case. No. 30-2015-00818011-CU-BC-CJC Abdurrezag Kaal, an individual, Reassigned for All Purposes to: Plaintiffs, Judge Melissa McCormick, Dept. C-13 -VS- : : fo PLAINTIFFS’ OPPOSITION TO THE Lota cw, Ty Corporation; and | NATION FOR JUDGMENT ON THE ’ ’ PLEADINGS FILED BY DEFENDANT, Defendants. YORBA CW, INC. Date: March 14,2019 Time: 1:30 pm Dept. C-13 Complaint Filed: November 2, 2015 COME NOW, Plaintiffs Aska Sakan, Inc. (“Aska”) and Abdurrezag Kaal (“Kaal”, and together with Aska, “Plaintiffs”) and respectfully submit this opposition to the motion for judgment on the pleadings filed by defendant, Yorba CW, Inc. (hereinafter “Yorba” or “Defendant™). 111 [11 -1- PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. OO 0 3 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MEMORANDUM OF POINTS AND AUTHORITIES L INTRODUCTION This action was originally filed on November 2, 2015. However, due to the disbarment and disappearance of defendants’ prior counsel, Jimmy P. Mettias, in August of 2017, discovery has been at a stand-still since then. When Plaintiffs’ current counsel of record discovered this after its substitution into the case in February of 2018, a motion to have the answer stricken was filed and set for hearing. While this motion was pending, Plaintiffs’ counsel spent countless time and effort seeking to provide the appropriate notice to defendants and ascertain whether counsel would be substituting into the defense in the action. Finally, enters Mr. Peter Wittlin, Esq. who deems it appropriate at this late hour to file challenges to the Complaint by way of a demurrer and motion for judgment on the pleadings. Although the challenges to the pleadings are wholly inappropriate from a timing perspective, they are also substantively and procedurally inept for other reasons. First off, Defendant’s Motion for Judgment on the Pleadings (“Motion”) served upon Plaintiffs> counsel appears to be missing several of the referenced exhibits, making it decidedly difficult for Plaintiffs to oppose the arguments therein in their entirety. (See Declaration of Adam I. Miller, and the Exhibit A thereto.) What’s more, Defendants’ Motion purports to attach additional exhibits that were not included in the complaint. In this regard, Defendants are asking this Court to consider matters outside of the allegations made in the Complaint, which would be entirely improper at this stage. Next, the Motion’s arguments are mostly conjecture, without any rationale legal arguments supporting them. To the extent the arguments therein present more than mere conjecture, they are substantively flawed for several reasons as set forth below. As such, the Motion should be denied in its entirety. II. LEGAL STANDARD ON MOTION FOR JUDGMENT ON THE PLEADINGS A motion for judgment on the pleadings is equivalent to a demurrer and is subject to the same legal standard. A demurrer is a pleading used to test the legal sufficiency of other pleadings. It raises issues of law, not fact, regarding the form or content of the opposing party’s pleading. Cal. Code of Civ. Proc. $§442.10, 589; see Donabedian v. Mercury Ins. Co. (2004) 116 Cal.App.4th 968, 994; -2- PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Lewis v. Safeway, Inc. (2015) 235 Cal. App.4th 385, 388. At the demurrer stage, the Court accepts as true the material factual allegations of the complaint. Hoffman v. Smithwoods RV Park, LLC (2009) 179 Cal.App.4th 390, 400. A complaint is liberally construed, with a view to substantial justice between the parties. Cal. Code of Civ. Proc. § 452. “In testing the legal sufficiency of a pleading against a general demurrer, all properly pleaded allegations, including those that arise by reasonable inference, are deemed admitted regardless of the possible difficulty of proof at trial.” Saxer v. Philip Morris, Inc. (1975) 54 Cal.App.3d 7, 18. The complaint must be liberally construed and survives a general demurrer insofar as it states, however inartfully, facts disclosing some right to relief. Longshore v. County of Ventura (1979) 25 Cal.3d 14, 22. A demurrer can be used only to challenge defects that appear on the face of the pleading under attack; or from matters outside the pleading that are judicially noticeable. Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Donabedian, supra, 116 Cal.App.4th at 994. No other extrinsic evidence can be considered (i.e., no “speaking demurrers™). lon Equip. Corp. v. Nelson (1980) 110 Cal.App.3d 868, 881 (error for court to consider facts asserted in memorandum supporting demurrer); Afuso v. United States Fid. & Guar. Co., Inc. (1985) 169 Cal. App.3d 859, 862 (disapproved on other grounds in Moradi-Shalal v. Fireman's Fund Ins. Cos. (1988) 46 Cal.3d 287 - error for court to consider contents of release which was not part of any court record). III. ARGUMENT At the outset, aside from the Motion missing several exhibits referenced therein, making it decidedly difficulty to oppose in its entirety, there are inconsistencies with respect to the Motion’s representations as to the allegations made in the Complaint that should be noted. For example, the Motion misrepresents that the complaint alleges that Aska received the Phase I report over two years after the close of escrow. (See Motion p. 3, Ins. 8-11.) This is simply not true. In paragraph 23 of the complaint, it is alleged that “Plaintiffs did not receive the Phase I report from Yorba until July 8, 2015”, approximately one month after the close of escrow date alleged. (See Complaint p. 6, § 23.) There are various other dates mentioned in the Motion that are misquoted from the Complaint. -3- PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. 10 11 12 13 14 15 16 17 18 19 20 21 22 24 25 26 27 28 Next, the Motion generally argues that waiver - a fact-intensive defense with many components - should apply and cites to portions of one segment of the contract attached to the complaint as a basis for such a defense. First off, the defense of waiver is hardly a decision for demurrer. Indeed, the burden is on the party claiming a waiver of a right to prove it by clear and convincing evidence that does not leave the matter to speculation, and “doubtful cases will be decided against a waiver”. City of Ukiah v. Fones (1966) 64 Cal.2d 104, 107-108; DRG/Beverly Hills, Ltd. V. Chopstix Dim Sum Café and Takeout 111, Ltd. (1994) 30 Cal. App.4th 54, 61. “There can be no waiver where the one against whom it is asserted has acted without full knowledge of the facts. It cannot be presumed, in the absence of such knowledge, that there was an intention to waive an existing right.” Craig v. White (1921) 187 Cal. 489, 498. As acknowledged by the Motion, the Complaint alleges that Plaintiffs did not receive the Phase I report disclosing the hazardous conditions on the property until after the close of escrow. Accordingly, based on the allegations made in the Complaint and reasonable inferences derived therefrom, Plaintiffs did not have any knowledge of the hazardous condition of the property until after the occurrence of the purported “waiver”. Taking such allegations as true on their face, the defense of waiver must fail as Plaintiffs did not possess the prerequisite knowledge necessary for wavier to have occurred. As such, the Motion must be denied in this regard. As to the Motion’s challenge to the specific causes of action, they are not appropriate matters to be decided on demurrer, and, at any rate, the Complaint pleads the causes of action with sufficient facts to survive the Motion. A. The Motion Should be Denied As To Its’ Challenge to the First Cause of Action. The Motion references a document purportedly titled “Business Purchase Agreement and Joint Escrow Instructions” as Exhibit 2 to the Motion, which Defendant argues “should have been included in the complaint”, however, the Motion that Plaintiffs were served with fails to attach any Exhibit 2 or document titled as such. Moreover, the purported document was not included in the Complaint, nor were Plaintiffs required to include it therein. Defendant’s attaching evidence to their Motion and asking this Court to rule on such information outside of the allegations in the Complaint is wholly improper. See E.g., Afuso, supra. Aside from the procedural defects, it appears that the basis of this 4. PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 2 28 argument is also waiver, and thus it is substantively flawed for the same reasons as set forth above regarding waiver. Accordingly, as to the first cause of action, the Motion should be denied as the arguments made therein are procedurally and substantively flawed. B. The Motion Should be Denied As To Its’ Challenge to the Second Cause of Action. There is an implied covenant of good faith and fair dealing in every contract that neither party will do anything which will injure the right of the other to receive the benefits of the agreement. Comunale v. Traders & General Ins. Co. (1958) 50 Cal.2d 654, 658. “In essence, the covenant is implied as a supplement to the express contractual covenants, to prevent a contracting party from engaging in conduct which (while not technically transgressing the express covenants) frustrates the other party’s rights to the benefits of the contract.” Racine & Laramie, Ltd. v. Department of Parks & Recreation (1992) 11 Cal. App.4th 1026, 1031-32. The Complaint sufficiently alleges the existence of the contract at issue. Moreover, Defendant’s argument that Yorba had no duty to “discover and disclose the condition of the Property” misses the point. The Complaint’s allegations are sufficient from a pleading perspective to demonstrate Defendants breach of the implied covenant of good faith and fair dealing with respect to their misrepresentations and intentional omissions regarding the hazardous conditions of the property subject to the contract for sale. Again, Defendant’s attempts to argue waiver are futile as set forth in detail above. C. The Motion’s General Challenge to the Complaint Regarding Kaal Not Being a Party to the Contract is Moot. The Motion only challenges Kaal’s standing to sue upon the contract at issue. Yet, it is not disputed that Aska is a party to the contract attached to the Complaint and, as such, Aska unquestionably has standing to sue. Thus, the argument here is moot as Aska is a plaintiff in this action and has standing to sue upon the contract alleged. D. The Motion Should be Denied As To Its’ Challenge to the Third Cause of Action. Defendants argue that the Complaint fails to allege that Defendants knew or had reason to believe the property was contaminated. This assertion is contrary to the allegations in the Complaint. -5- PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. 10 11 12 14 15 16 17 18 19 20 21 22 24 2 26 27 28 The Complaint alleges upon information and belief that Defendants possessed such knowledge, and bases their information and belief upon Defendant Yorba concurrently being in escrow to purchase the carwash. (See Complaint p. 6, 4927 & 28.) As such, the third cause of action is sufficiently pled. E. The Motion Should be Denied As To Its’ Challenge to the Fourth Cause of Action. Contrary to the Motion’s assertion, the Complaint alleges sufficient facts to identify “whom” the statements regarding the intentional misrepresentations alleged were made. The complaint alleges that Defendants Gadi Emein and Saied Aminpour made such statements. (See Complaint p. 5, § 20; p. 11,9 54.) Defendants include both Emein and Aminpour. As such, the Complaint has sufficiently alleged whom such statements were made by. F. The Motion Should be Denied As To Its’ Challenge to the Sixth Cause of Action. The Motion here offers nothing more than conjecture. No actual legal arguments are made, much less is any case law or citations to statute provided. That aside, the Complaint sufficiently alleges the elements required for fraudulent concealment; namely, the concealment and suppression of the existence of the environmental hazards and contamination issues, the materiality of such facts, which in their absence induced Plaintiffs into purchasing the Carwash for $4.5 million cash, Plaintiffs reasonable reliance, the resulting harm that was proximately caused by Defendants concealment and suppression alleged. (See Complaint pp. 12-13, 49 57-63.) Defendant’s argument here also appears to be predicated on “waiver” again, which likewise is dealt with in the arguments set forth above. G. The Motion Should be Denied As To Its’ Challenge to the Seventh Cause of Action. Once again, Defendant’s arguments here are predicated on a fact not alleged in the Complaint. The timing of when the notice to rescind the Contract is a factual issue that is not ripe to be decided on demurrer. H. The Motion Should be Denied As To Its’ Challenge to the Eighth Cause of Action. Again, the argument offered here is conjecture and nothing more. Negligence is sufficiently alleged in the Complaint. (See Complaint p. 14, 4 69-73.) 111 [17 «ie PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. Ww oo 0 J DD 10 11 12 13 14 15 16 17 18 19 20 21 93 23 24 25 26 9 28 IV. LEAVE TO AMEND SHOULD BE GRANTED. The same standards apply in granting leave to amend as for demurrers and leave is routinely granted. People v. $20,000 U.S. Currency (1991) 235 Cal. App.3d 682, 692. Courts are very liberal in permitting amendments, not only where a complaint is defective in form, but also where substantive defects are apparent: “Liberality in permitting amendment is the rule, if a fair opportunity to correct any defect has not been given.” Angie M. v. Sup. Ct. (Hiemstra) (1995) 37 Cal. App.4th 1217, 1227; Stevens v. Sup. Ct. (API Ins. Services, Inc.) (1999) 75 Cal.App.4th 594, 601. This is especially true where, as here, the challenge is brought against an original complaint. Indeed, in the case of an original complaint, plaintiff need not even request leave to amend: “Unless the complaint shows on its face that it is incapable of amendment, denial of leave to amend constitutes an abuse of discretion, irrespective of whether leave to amend is requested or not.” McDonald v. Sup. Ct. (Flintkote Co.) (1986) 180 Cal. App.3d 297, 303-304; see also City of Stockton v. Sup. Ct. (Civic Partners Stockton, LLC) (2007) 42 Cal.4th 730, 747 (where plaintiff has not had opportunity to amend complaint in response to demurrer, “leave to amend is liberally allowed as a matter of fairness unless the complaint shows on its face that it is incapable of amendment”). In the case of a motion for judgment on the pleadings where no previous demurrer has been interposed, it is an abuse of discretion to deny leave to amend after granting a motion for judgment on the pleadings. Maclsaac v. Pozzo (1945) 26 Cal.2d 809, 815 (finding that pleaders should have the same opportunity to cure defects in their pleadings as they would have had after a normal ruling on demurrer). If this Court were to agree that the Complaint fails to state a cause of action, and therefore sustains Defendant’s Motion, leave to amend the Complaint should be granted. yi Il 111 "= PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. oO 0 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 V. CONCLUSION. For the foregoing reasons, Defendant’s Motion for Judgment on the Pleadings should be denied in its’ entirety. However, if this Court should grant the Motion, then leave to amend the Complaint should be afforded to Plaintiffs. March 1, 2019 MILLER MILLER GERBER LLP ATTORNEYS AT LAW A 7 = CP pl By: Adam I. Miller Mathieu H. Putterman Attorneys for Plaintiffs Aska Sakan, Inc., a California corporation; and Abdurrezag Kaal -8- PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT YORBA CW, INC. 10 11 12 13 14 15 16 IF 18 19 20 21 22 23 24 25 26 27 28 DECLARATION OF ADAM I. MILLER I, Adam I. Miller, declare as follows: 1. I am an attorney at law licensed to practice before all the courts of the State of California. That I am a member of the law firm Miller Miller Gerber LLP, attorneys of record for the above titled Plaintiffs. Pn I am the handling attorney for this matter and I am familiar with the matter. 3, That attached hereto as Exhibit A is a true and correct copy of the Motion for Judgment on the Pleadings of Defendants Yorba CW, Inc. as served upon my office. 4. If called to testify I can do so competently. I declare the above is true and correct under penalty of perjury. Executed this 1%" day of March, 2019, in Irvine, California. I er” ADAM I. MILLER _9. DECLARATION OF ADAM 1. MILLER EXHIBIT A ua o x Ww nN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Peter C. Wittlin CSB#75222 Attorney at Law 8 Corporate Park, Suite 300 Irvine, CA 92660 (949) 430-6529 pwittlinegmail.com Attorney for Defendants, Yorba CW, Inc., a California corporation; Gadi Emein, & Saied Aminpour Superior Court of California County of Orange - Central Justice Center Case No. 30-2015-00818011 -CU-CO-~-CJcC Aska Sakan, Inc., a California Corporation; and Abdurrezag Kaal, an individual; Assigned to Judge Melissa McCormick C13 Plaintiffs, Vv. Notice of Motion; Motion for Judgment on the Pleadings; Points & Authorities; Declaration of Peter C. Wittlin [Code.Civ.Proc. Yorba CW Inc., a California Corporation, and Does 1 to 30, inclusive, Defendants. §§ 438(B) (ii) (2) (A)] Date: March qh, 2019 Time: |:A0 .m Dept: C13 To Plaintiffs and to Their Attorneys of Record: Please take notice that on March qin, 2019, on the | 30) ____.m. calendar in department C13 of the above-entitled court located at 700 Civic Center Drive West, Santa Ana, California 92701, that defendant Yorba CW, Inc., a California corporation ("Yorba"), shall move, and hereby moves, for judgment on the pleadings against plaintiffs, and each of them, pursuant to California Code of Civil Procedure section 438 (B) (ii) (2) (A) on grounds that each alleged cause of action of the complaint fails -1- /Motien for Judgment on the Pleadings - mm arr bie FS A EMS STINE EXHIE x J o n On 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 to state facts sufficient to constitute a cause of action against defendant Yorba. Hearing of this motion shall be based on this notice of motion, on the pleadings and records already on file in this civil action, on the accompanying declaration of Peter C. Wittlin, and on such other evidence as may be presented at hearing of this motion. Dated: February 12, 2019 J X PCL Peter C. Wittlin Attorney for De dans Yorba CW, Inc. Gadi Emein, & Saied Aminpour /Motion for Judgment on the Pleadings co d o y U r a Ww NN 10 11 12 13 14 15 16 17 18 19 20 2.1 22 23 24 25 26 27 28 - Introduction This case filed November 2, 2015, arises out of the June 2, 2015, close of escrow on the sale of a Carwash business, and the land upon which it is located at 17091 Imperial Highway in Yorba Linda, California ("the Property"), by then owner, defendant Yorba CW, Inc. ("Yorba"), to purchaser, Aska Sakan, Inc. ("Aska") Aska contends in its complaint that on July 8, 2017, after it closed escrow on June 2, 2015, on its purchase of the land, that it received an April 17, 2015, dated "Phase I (Environmental) Report," and that, "After reviewing (the report), thet plaintiffs have determined thet the property is and bes been contaminated and that it is and has been subject to remediation for hazardous materials and their use of the Property would be restricted." [{ 24, Complaint] Plaintiffs, who are Aska and its president, Abdurrezag Kaal ("Kaal"), sue on eight causes of action concerning the alleged contamination, i.e., for (1) breach of contract, (2) breach of implied covenant of good faith and fair dealing, (3) violation of Health Code Section 25359.7 (a), (¢) intentional misrepresentation; (5) negligent misrepresentation; (6) fraudulent concealment, (7) rescission based on fraud, and (6) negligence. The thrust of this motion for judgment on the pleadings is that plaintiffs, in incorporating by reference paragraph 24 of the contract upon which they sue, effectively waived their right to complain about the condition of the Property. Paragraph 24 of the contract (Exhibit "1" to the complaint) says in boldface -3- /Hotion for Judgment on the Pleadings a 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 capital letters, "BUYERS DEPOSIT OF FINAL CLOSING FUNDS SHALL BE DEEMED BUYER'S FULL APPROVAL AND ACCEPTANCE OF . . . ALL INSPECTIONS, DISCLOSURES AND THE CONDITION OF SUBJECT PROPERTY." When Aska closed escrow on June 2, 2015, on its purchase of the Property, it thereby fully approved and accepted the alleged contaminated condition of the Property. This renders the entire complaint for relief for alleged contamination non-actionable based upon Buyer-Aska waiver. 1. The first cause of action, for "breach of contract," fails to state a cause of action because the very language of the contract upon which it sues waives Buyer's right to complain about the condition of the property. A demurrer can be utilized where the complaint itself discloses some defense that would bar recovery [Guardian North Bay, Inc. v. Sup. Ct. (Myers) 2001 94 Cal.4th 963, 971-972]. Defects appearing on the face of the complaint include matters shown in exhibits attached to the complaint and incorporated by reference [Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94; Barnett v. Fireman's Fund Ins. Co. (2001) 90 Cal.App.4th 500, 505 ("we rely on and accept as true the contents of the exhibits and treat as surplusage the pleader's allegations as to the legal effect of the exhibits"); George v. Automobile Club of §. Calif. (2011) 201 Cal.App.4th 1112, 1130 ("trial court was not required to credit plaintiff's allegations that extrinsic evidence ‘'renders the insurance contract at issue here ambiguous'"® where the language of the policy attached to ~4- /Wotion for Judgment on the Pleadings g x WwW N D © J oO 10 11 12 13 15 16 17 18 19 20 23 22 23 24 25 26 27 28 complaint showed otherwise.") The underlying "Business Purchase Agreement and Joint Escrow Instructions" dated two days earlier, December 15, 2017, a copy of which is attached hereto as Exhibit vwaw (which should have been included in the complaint as part of Exhibit mim) like Exhibit "1" contains no obligation of seller-Yorba to disclose the condition of the Property, only that the "PURCHASE IS SUBJECT TO A CLEAN ENVIRONMENTAL REPORT ONSITE." [§ 24]. That presumably means a "clean" Phase T Report. Yet plaintiffs in their own "breach of contract" cause of action plead paragraph 24 of the contract that by closing escrow on June 2, 2015, they accepted the condition of the Property, thereby waiving their right thereafter to complain about it. This express waiver is fatal to their "breach of contract" cause of action, which cannot be amended to state one unless perchance plaintiffs were to attach and incorporate by reference a written amendment to escrow extending the time beyond June 2, 2015, within which to complain about the Property's condition. Unless plaintiffs' counsel can now state in a declaration under penalty of perjury that such a written amendment exists, leave to amend the first cause of action should not be granted. 2. Bs to the second cause of action, no covenant of good faith and fair dealing may be implied in the contract to contradict its express limited covenant that seller-Yorba's only contractual obligation to Buyer-Aska concerning the Property was to provide it with a "clean" Phase I Report. The implied covenant of good faith and fair dealing is “5 /Motion for Judgment on the Pleadings O Y WO S o y s e w Nd N O N R N N N N N N N RE PR E l R E e R WwW J y U s W N R E O Ww m d e sy Ww N E applied as a means of "filling" the terms of the contract only when the express terms of the contract are silent or ambiguous regarding the obligation of the parties. A term may not be implied when the contract terms are clear and specific regarding the performance that is required of the parties, and the implied covenant may not be used to impose a duty on a party that is inconsistent with, or in addition to and independent of the express provisions of the contract. [Carma Developers (Cal), Inc. Vv. Marathon Development California Inc. (1992) 2 Cal.4th 342, 371-3761. In the instant case, imposing a duty upon seller-Yorba to discover and disclose to Buyer-Aska soil contamination of the Property is (a) inconsistent with, or (b) in addition to, or (c) independent of the express provision of the contract only to provide buyer-Aska with a Phase I Report. Even absent Aska's express waiver as to the condition of the Property, seller-Yorba had no covenant to Buyer-Aska, express or implied, to discover and disclose the condition of the Property. Disclosure of the Property's condition was expressly covenanted to be contained in the Phase I Report, - a condition which Buyer-Aska waived. 3. Plaintiff Kaal is not a proper party to Buver-Aska's "breach of contract" or "implied covenant" cause of action. Kaal can state no contract cause of action, for he has no standing to assert one. He is not a party in the purchase agreement, but only the agent of a party. There is no law which allows him to sue as a party to a contract made by his principal. Only his principal, the party to the contract, may sue on it. Unless Kaal can point to some legal authority which allows him as -6- /Motion for Judgment on the Pleadings w N R <4 oy os 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 party to sue for breach of a contract to which he is not a party, he can state no breach of contract claim, and should be dismissed from both the first and second causes of action. CACI No. 303, a copy of which is attached hereto as Exhibit "3," provides that it is the party to the contract who may sue for its breach. Nowhere does it say that a party's agent has standing to sue for breach of his principal's contract. 4. The third cause of action for "violation of H&S Code § 25359.7(a) states no cause of action against seller-Yorba. Section 25359.7(a), a copy of which is attached hereto as Exhibit "4," is specific. It says that If the owner of the property knows, or has reasonable cause to believe, that any release of hazardous substance which is on or beneath the real broperty, he must give written notice of that condition to buyer. It doesn't say when. Presumably it should be before the close of escrow. Plaintiffs fail to allege in this cause of action that defendant-Yorba knew or had reasonable cause to believe the Property was contaminated, only that if it did it had a duty to disclose the condition to Buyer-Aska. Without an affirmative allegation that Seller-Yorba knew of contamination, or had reason to know of it, no cause of action for violation of section 25359.7({a) is stated. Assuming plaintiffs may so amend the cause of action to allege seller-Yorba's requisite scienter, is that enough to make the cause of action viable? No, because the pleading itself expressly waives Buyer-Aska's right to receive Seller-Yorba's disclosure or to protest about the condition of the Property by ~7- /Motion for Judgment on the Pleadings N Y o s Ww 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - allowing escrow to close on June 2, 2015, without receiving it. One can't complain about what one in his own words has expressly waived. Plaintiff-Kaal is not the purchaser of the Property. He has no standing as a non-owner to complain about its condition through H&S Code section 25359.7(a), as alleged. 5. Plaintiffs state no cause of action for "intentional or negligent misrepresentation" against defendant Yorba. In order to state a cause of action for "fraud" against a defendant-corporation, per the California Supreme Court case of Lazar v. Superior Court (1996) 12 Cal.4th 631, the pleader must allege each of the following elements: a) the names of those who made the misrepresentations; b) their authority to speak for the corporation; c) to whom they spoke; d) what they said or wrote, and e) when it was said or written. Nowhere in either of these two causes of action do plaintiffs identify which persons spoke, with authority from whom, to which persons he or they spoke, or whether anything said was written. Hence no cause of action for intentional or negligent misrepresentation has been stated. Even if plaintiffs may amend the cause of action to comply with the Lazar pleading requirements, they still need to deal with buyer-Aska's express contractual waiver as to the condition of the Property. How may they do that? Only with a written amendment to escrow preserving Aska's right to complain about the condition of the Property after close of escrow. Otherwise they -8- /Motion for Judgment on the Pleadings ~~ o n w m 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 - -~- % cannot state a cause of action for intentional or negligent misrepresentation for failure to disclose the Property's condition. May plaintiffs’ counsel declare under penalty of perjury that there is such a written amendment floating around? If he can't, leave to amend both the fourth and fifth causes of action should be denied. No cause of action for "fraud" can be stated by plaintiff- Kaal, because he, a non-owner of the Property, has no standing to assert it. 6. No cause of action is stated in the sixth cause of action for "fraudulent concealment." Even assuming that defendant-Yorba knew, or has reason to know, that the Property's soil was contaminated, Buyer-Aska covenanted in writing that Yorba's only duty to Aska was to provide Aska with a "clean" Phase I Report. One may expressly contract away one's otherwise existing duty, as here. Here, Seller-Yorba agreed to do one better for Aska, to present a written environmental report prepared by an environmental specialist to detail any contamination of the Property. Buyer- Aska, by closing escrow on June 2, 2015, without receiving or reading the Report, waived any right it had to complain about the condition of the Property, or about Seller-Yorba's alleged failure to disclose it. Buyer-Aksa affirmatively pleaded in its own complaint its waiver to complain of contamination. Plaintiff Kaal, a non-owner of the Property, has no standing Lo complain about its condition. Nor was there any duty of disclosure owed to him. 7. The seventh cause of action fails to state one for -9- /Motion for Judgment on the Pleadings Ww N E QO ww Ow J o y U n 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 "rescission" because it does not allege that plaintiffs promptly notified Seller-Yorba of its intent to rescind the purchase. The complaint alleged that escrow closed on June 2, 2015, and on July 8, 2015, plaintiffs received the Phase TI Report upon which they protest. They did not file suit until November 2, 2014, more than three and half months later, or 86 days later, giving no notice of rescission other than as contained in the complaint itself. Prompt notice of rescission is required under the law. Civil Code section 1691 (a) provides: "Subject to Section 1693, to effect a rescission a party to the contract must promptly upon discovering the facts which entitled him to rescind (a) Give notice of rescission to the party as to whom he rescinds." (Emphasis added.) Per the statute, absent an allegation of duress, menace, undue influence, or disability, it is inconceivable that prompt notice of rescission may be effected 86 days after discovering the alleged contamination. Plaintiffs expressly allege in the complaint that upon receiving the Report on July 8, 2015, that they read it and base their allegations of wrongdoing on having read it. A defendant who seeks to vacate a default entered against him, generally has no more than 40-50 days after discovering it to move to vacate it. Here, plaintiffs waited &6 days to react, - well after they learned of the alleged contamination to begin to rescind their purchase. They simply waited too long to "rescind." According to Estrada v. Alvarez (1952), diligence is -10- /Motion for Judgment on the Pleadings a U s W N 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 a condition of the right to rescind. Plaintiffs demonstrate no diligence in giving notice to rescind 86 days later. Plaintiff Kaal has no standing to rescind the transaction, because he was not a party to it. As to the eighth and last cause of action, i.e., for ‘negligence, " it fails for the same reason as do the 4%, 5th op 6" causes of action because of Buyer-Aska's express waiver to complain about the condition of the Property after close of escrow. Buyer-Aska, in closing escrow on June 2, 2015, expressly accepted the condition of the Property, and hence alleviated Seller-Yorba of any duty to disclose the condition. One may voluntarily waive another's allegedly negligent conduct. So done here by Seller-Aska. Plaintiff Kaal, a non-owner of the Property, has no standing to sue Seller-Yorba for negligence concerning it. Summary: Judgment on the pleading should be granted on each of the eight (8) causes of action without leave to amend unless plaintiff's counsel can affirmatively represent that Seller-Yorba and Buyer-Aska agreed in writing to waive Buyer-Aska's June 2, 2015, waiver as to the condition of the Property. Unlikely. Dated: February 12, 2019 Respectfully submitted, x PUM Peter C. Wittlin Attorney for Defendant Yorba CW, Inc., Gadi Emein, & Saied Aminpour -11- Motion for Judgment on the Pleadings Ww ww ~~ o n wm 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 20 26 27 28 Declaration of Peter C. Wittlin I, Peter C. Wittlin, declare: 1. I am the attorney of record for defendant-Yorba in this case. 2. On January 8, 2019, I emailed to plaintiffs' counsel, Mathieu H. Putterman, my "meet and confer" letter to him requesting that we meet and confer by telephone pursuant to Code of Civil Procedure section 439 for the purpose of determining if an agreement could be reached between us to resolve the prospective motion's claims.” A copy of my letter is attached hereto, marked Exhibit "5." I have to date heard nothing from Attorney Putterman in ths regard. I did yesterday, on February 11, 2019, received word from his superior, Adam Miller, that plaintiffs would not be amending their complaint. Hence I am filing and serving this motion now. I am familiar with the certified escrow file on the subject sale of the Property, and append hereto a copy, marked Exhibit "2," of the underlying purchase agreement which plaintiffs failed to do. Attached hereto, marked Exhibit "6," is a copy of the Phase I Report, which provides at its end that no remediation is needed. I declare under penalty of perjury per California law that the foregoing is true and correct and is executed in Irvine, California this 12" day of February 2019. wo POSH Ts Peter C. Wittlin -12- /Motion for Judgment on the Pleadings Ww O e a AN 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 PROOF OF SERVICE (Sakan, et al. v. Yorba CW, Inc., et al. OCSC Case No. 30-2015-00818011) STATE OF CALIFORNIA ) ) COUNTY OF ORANGE ) I am employed in the County of Orange, State of California. I am over the age of 18 and not a party to the within action; my business address is 18301 Von Karman Ave., Suite 950, Irvine, CA 92612. On March 1, 2019, I served the foregoing document described as PLAINTIFFS’ OPPOSITION TO THE MOTION FOR JUDGMENT ON THE PLEADINGS FILED BY DEFENDANT, YORBA CW, INC. on the interested parties in this action by placing a true and correct copy thereof enclosed in sealed envelopes addressed as follows: Peter C. Wittlin, Esq. Attorney at Law 8 Corporate Park, Ste. 300 Irvine, CA 92606 (949) 430-6529; Fax: (949) 247-8977 pwittlin@gmail.com Attorneys for Defendants, Yorba CW, Inc.; Gadi Emein; and Saeid Aminpour (}] BY MAIL I am "readily familiar" with the firm's practice of collection and processing correspondence for mailing. Under that practice it is deposited with U.S. postal service in a sealed envelope on the same day with postage thereon fully prepaid at Newport Beach, California in the ordinary course of business. I am aware that on motion of the party served, service is presumed invalid if the postal cancellation date or postage meter date is more than one day after the date of deposit for mailing stated in the affidavit. [| BY ELECTRONIC SERVICE. By submitting a true copy of the foregoing on the Clerk of the Orange County Superior Court using One Legal Online Court Services [1 BY PERSONAL SERVICE I delivered such envelope by hand to the office of the addressee. [XX] BY FEDERAL EXPRESS I caused said envelope to be sent by overnight delivery to the addressee. [] BY FACSIMILE I caused said documents to be transmitted by fax transmission from (714) 450- 3801 and the transmission was reported as complete and without error. A copy of the transmission report is attached to the proof of service. I declare under penalty of perjury pursuant to the laws of the State of California that the foregoing is true and correct. Executed on March 1, 2019 at Irvine, California. Mashadec bw) NAGHINDER K. JOHAL -10- PROOF OF SERVICE