Case Number: EC064906??? Hearing Date: April 29, 2016??? Dept: A
Top Remodeling, Inc. v Gonzalez
DEMURRER
Calendar: 13
Case: EC064906
Date: 4/29/16
MP: Defendants, Francisco Gonzalez, Francisco Lopez, Javier Gonzalez, and
Francisco Gonzalez
RP: Plaintiff, Top Remodeling Inc.
ALLEGATIONS IN COMPLAINT:
The Defendant entered into the office of the Plaintiff?s attorney and threatened to make a complaint to OSHA if the Plaintiff did not write a check to him. In addition, the Defendant contacted two current or form employees and published false information to disrupt the Plaintiff?s relationship with the employees. Further, the Defendant converted the Plaintiff?s personal property when he left. Finally, the Defendant breached a loan agreement by failing to repay amounts due on the loan.
CAUSES OF ACTION IN COMPLAINT:
1) Extortion
2) Intentional Interference with Contractual Relations
3) Intentional Interference with Prospective Economic Relations
4) Slander
5) Trespass to Personal Property
6) Conversion
7) Unlawful Business Practices
8) Breach of Contract
9) Common Count
10) Accounting
RELIEF REQUESTED:
Demurrer to first, second, third, seventh, and ninth causes of action.
DISCUSSION:
This hearing concerns the Defendants? demurrer to the Complaint. The demurrer is moot with regards to Francisco Lopez, Javier Gonzalez, and Francisco Gonzalez because the Plaintiff dismissed these Defendants on April 8, 2016. Accordingly, the only remaining named Defendant is Francisco Gonzalez.
1. First Cause of Action for Extortion
The Defendant argues that an extortion claim does not plead that the Plaintiff paid the money demanded or that the Defendant knew of the falsity of his claim. Neither is a required element.
The Supreme Court discussed the civil remedy for extortion in Flatley v. Mauro (2006) 39 Cal. 4th 299 and based its analysis on the Penal Code sections that define the crime of extortion. The crime is defined in Penal Code sections 518 to 527. Under Penal Code section 518, extortion is the obtaining of property from another, with his consent induced by a wrongful use of force or fear. Penal Code section 519 states that fear, for purposes of extortion may be induced by a threat, either:
1) To do an unlawful injury to the person or property of the individual threatened or of a third person; or,
2) To accuse the individual threatened, or any relative of his, or member of his family, of any crime; or,
3) To expose, or to impute to him or them any deformity, disgrace or crime; or,
4) To expose any secret affecting him or them.
The Penal Code criminalizes both extortionate conduct that obtains property and extortionate conduct that attempts to obtain property. Penal Code section 523 states that every person who, with intent to extort any money or other property from another, sends or delivers to any person any letter or other writing, whether subscribed or not, expressing or implying, or adapted to imply, any threat such as is specified in Section 519, is punishable in the same manner as if such money or property were actually obtained by means of such threat (italics added for emphasis).
The Supreme Court in Flatley v. Mauro (2006) 39 Cal. 4th 299, 326-332 was discussing the law related to extortion in order to analyze an anti-SLAPP motion. In Flatley, the plaintiff, Michael Flatley, who is a well known performer and choreographer in Irish dance, brought an extortion claim against the defendant, Tyna Robertson, on the ground that she had threatened to say that he had raped her unless she paid him a
substantial sum of money, “seven figures”. The plaintiff also sued the defendant’s attorney, D. Dean Mauro, because the attorney had written a letter and made phone calls to demand that the plaintiff pay the money to avoid being ruined by the story. The plaintiff did not pay the money; instead, he filed a complaint to seek damages and pleaded a claim for extortion.
The attorney, D. Dean Mauro, filed an anti-SLAPP motion on the ground that his communications to the plaintiff were protected under CCP section 425.16 because they were made in furtherance of the right to petition. The trial court denied his motion. The Court of Appeal affirmed the trial court on the ground that the communications were criminal extortion and not protected under CCP section 425.16. The Supreme Court affirmed the Court of Appeal on the same ground, which is that the communications were criminal extortion, i.e., illegal speech, and not protected under section 425.16. As a matter of law, extortion is not a constitutionally protected form of speech. See e.g., United States v. Quinn (5th Cir. 1975) 514 F.2d 1250, 1268 (?It may categorically be stated that extortionate speech has no more constitutional protection than that uttered by a robber while ordering his victim to hand over the money, which is no protection at all?). Accordingly, the Supreme Court found that the trial court had correctly denied the motion to strike under the anti-SLAPP statute because the communications made by the attorney did not fall within a category protected by CCP section 425.16.
Further, the Supreme Court noted that extortion is a paradoxical crime because it criminalizes the making of threats that, in and of themselves, may not be illegal, e.g., to report a crime. The wrongful conduct of extortion arises from the coupling of the threat with a demand for money. As noted above, Penal Code section 523 makes this wrongful conduct a crime even when no money or property was actually obtained by means of the threat.
Therefore, it is not an essential element of an extortion cause of action that money or property be surrendered or that the defendant know his statement is false. As noted in Flatley, a civil cause of action for extortion arises when there is a written threat coupled with a demand for money, irrespective of whether the plaintiff surrendered the money or whether the statement is true. See Penal Code section 523 (the written extortionate conduct is punishable in the same manner as if such money or property were actually obtained by means of such threat). Since it is not an essential element for the Plaintiff to pay the money or the Defendant to know his statement is false, this is not grounds for a demurrer.
Accordingly, the Court will overrule the demurrer to the first cause of action.
2. Demurrer to Second Cause of Action for Interference with Contractual Relationship
The Defendant argues that this cause of action lacks specific allegations that he intended to disrupt the Plaintiff?s relationship that the Defendant?s conduct made it more difficult to perform the contract, or that the Plaintiff was harm. The Defendant does not cite to any legal authority to show that these are requirement. There is no requirement that the cause of action be pleaded with specific facts. Further, as the following shows, there is no essential element that is pleaded with facts showing that the Defendant intend to disrupt the relationship or that the Defendant?s conduct made it more difficult to perform the contract.
The elements of this cause of action are the following:
1) the plaintiff had a valid and existing contract with a third party;
2) the defendant had knowledge of the contract;
3) the defendant committed intentional and unjustified acts designed to interfere with or disrupt the contract;
4) actual interference with or disruption of the relationship; and
5) resulting damages.
Davis v. Nadrich (2009) 174 Cal.App.4th 1, 10
In paragraph 21, the Plaintiff alleges that the Defendant contacted at least two current or former employees in an attempt to forment displeasure and to encourage additional Federal or State complaints against the Plaintiff. This is sufficient to plead that the Defendant engaged in intentional acts designed to interfere with or disrupt the Plaintiff?s contracts.
In paragraph 23, the Plaintiff alleges that the Defenant disrupted the Plaintiff?s ongoing relationship with its employees when he contacted the employees. This is sufficient to plead that the Defendant actually interfered or disrupted the relationship.
In paragraph 24, the Plaintiff alleges that as a result of the Defendant?s contact with its employees, the Plaintiff suffered damages. This is sufficient to plead that the resulting damages caused by the Defendant?s alleged conduct.
Accordingly, the Court will overrule the demurrer to the second cause of action.
3. Demurrer to Third Cause of Action for Intentional Interference with Prospective Economic Relations
The Defendant argues that the Plaintiff did not allege that the Defendant intended to disrupt the performance, that the relations were disrupted, or that the Plaintiff was harmed. This cause of action has the following elements:
1) economic relationship existing between the plaintiff and third party;
2) probability of future economic benefit to the plaintiff;
3) defendant’s knowledge of the relationship;
4) defendant’s intentional acts designed to disrupt the relationship;
5) defendant engaged in an independently wrongful act in disrupting the relationship beyond just inducing disruption of economic advantage;
actual disruption of the relationship; and
6) economic harm to the plaintiff caused by the acts.
Salma v. Capon (2008) 161 Cal.App.4th 1275, 1290.
In paragraph 26, the Plaintiff alleges that the Defendant contacted employees in an attempt to forment displeasure and to encourage additional Federal or State complaints against the Plaintiff. This is sufficient to plead that the Defendant engaged in intentional acts designed to disrupt the Plaintiff?s relationship.
In paragraph 28, the Plaintiff alleges that the Defenant disrupted the Plaintiff?s ongoing and future relationship with its employees when he contacted the employees. This is sufficient to plead that the Defendant actually disrupted the relationship.
In paragraph , the Plaintiff alleges that 29 as a result of the Defendant?s contact with its employees, the Plaintiff suffered damages. This is sufficient to plead that the resulting damages caused by the Defendant?s alleged conduct.
Accordingly, the Court will overrule the demurrer to the third cause of action.
4. Demurrer to Seventh Cause of Action for Violation of Business and Professions Code section 17200
The Defendant argues that the Plaintiff did not identify the business practices that were a violation of Business and Professions Code section 17200, which defines an unfair business practice to include any business practice that is unlawful, fraudulent, or unfair.
In paragraphs 56 to 68, the Plaintiff alleges that the Defendant charged the Plaintiff for time that he did not work, absconded with the Plaintiff?s personal property, and by defamed the Plaintiff to the Plaintiff?s employees. These allegations identify the unlawful business practices in which the Defendant engaged. This is sufficient to plead the claim.
Accordingly, the Court will overrule the demurrer to the seventh cause of action.
5. Demurrer to Ninth Cause of Action for Common Counts
The Defendant does not identify any missing element or grounds for a demurrer. The cause of action is based on common counts and has the following elements:
1) the statement of indebtedness in a certain sum,
2) the consideration, i.e., goods sold, work done, money loaned, and
3) nonpayment.
Allen v. Powell (1967) 248 Cal. App. 2d 502, 510.
The Plaintiff alleges in paragraphs 68 and 69 that the Defendant is indebted for at least $500 and that he has not repaid it. This is sufficient to plead the common count.
Accordingly, the Court will overrule the demurrer to the ninth cause of action.
RULING:
Overrule demurrers to first, second, third, seventh, and ninth causes of action.