Case Number:?BC688815????Hearing Date:?October 29, 2018????Dept:?47
Sharona Khorramian v. General Motors, LLC
(1) DEMURRER TO SECOND AMENDED COMPLAINT
(2) MOTION TO STRIKE
MOVING PARTY:???????????????(1) & (2) Defendant General Motors, LLC
RESPONDING PARTY(S): (1) & (2) Plaintiff Sharona Khorramian
STATEMENT OF MATERIAL FACTS AND/OR PROCEEDINGS:? ? ? ? ?
????????????Plaintiff alleges that there were steering, engine and other defects with the 2010 Chevrolet Equinox she purchased.
????????????Defendant General Motors, LLC demurs to the second amended complaint and moves to strike portions thereof.
TENTATIVE RULING:
Defendant General Motors, LLC?s demurrer to the second amended complaint is SUSTAINED.
Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment.?Goodman v. Kennedy?(1976) 18 Cal.3d 335, 348.???Plaintiff must demonstrate this possibility at the hearing.??If he doesn?t, no leave to amend will be given.
????????????Defendant?s motion to strike?the prayer for punitive damages at ? f., page 17:14 is GRANTED.??Whether leave to amend is granted or not will depend on whether leave is granted on the demurrer.
????????????If leave to amend is granted Plaintiff is given 30 days leave to amend.??Plaintiff will only be given?one more?opportunity to amend.
DISCUSSION:
Demurrer
Meet and Confer
????????????The Declaration of Joseph Dankert reflects that the meet and confer requirement set forth in CCP ? 430.41 was satisfied.
Discussion:
- Seventh Cause of Action (Fraud by Omission).
- ????????Re: Statute of Limitations.
????????????A cause of action for relief on the ground of fraud or mistake is subject to a three-year statute of limitations.??CCP ? 338(d).??The cause of action in that case is not deemed to have accrued until the discovery, by the aggrieved party, of the facts constituting the fraud or mistake.???Id.??However, if the facts pled in the complaint show that discovery occurred outside of the limitations period, the plaintiff must allege the date and manner of such discovery and why the delay in discovery is excused:
It is true that the three-year statute does not commence to run against an action for fraud or mistake until discovery thereof??Code Civ. Proc. ? 338, subd. 4; Hobart v. ?[*545]? Hobart Estate Co., 26 Cal.2d 412 [159 P.2d 958]). But?the burden is upon plaintiff to allege and prove facts which show the date and manner of such discovery.
As it is often stated,?plaintiff must plead facts to excuse the late discovery?(Johnson v. Ehrgott, 1 Cal.2d 136, 137 [34 P.2d 144]; Lady Washington Consol. Co. v. Wood, 113 Cal. 482 [45 P. 809]).?It is not sufficient merely to allege ignorance at one time and discovery at another?(Burke v. Maguire, 154 Cal. 456, 465 [98 P. 21]). Rather, the circumstances of the claimed discovery must be pleaded (English v. City of Long Beach, 126 Cal.App.2d 414, 420 [272 P.2d 875]), and it is then for the court to determine from such allegations whether the delay was excusable (Bank of America v. Vannini, 140 Cal.App.2d 120 [295 P.2d 102]).
Wilson v. Wilson?(1962) 199 Cal.App.2d 542, 544-45 (bold emphasis added).
????????????Here, Plaintiff purchased the subject vehicle in October 2010 (the exact date is still not specified).??2AC ? 17.??Plaintiff alleges at ? 19 that during the warranty period the vehicle contained or developed defects, including but not limited to, engine defects.??The seventh cause of action for fraud by omission is based on the alleged concealment by Defendant that the 2.4L engine was defective and susceptible to sudden and premature failure.???? 58 – 78.
????????????Here, Plaintiff alleges that she brought the vehicle in for repairs on December 8, 2011, March 21, 2012, July 17, 2012, November 8, 2012, November 12, 2012, March 6, 2013, May 9, 2013 and June 24, 2013 for various transmission, oil consumption and engine problems.??2AC., ? 20.??These are among the type of defects Plaintiff alleges the vehicle contained or developed, to wit: defects causing the vehicle to have frequent oil changes, a rattling notice in the engine, necessitating an oil consumption test, relating to the transmission, including having no reverse and slips.??? 19. Indeed, with regard to the seventh cause of action, Plaintiff alleges that Defendant knew the engine oil defect caused the engine to be unable to properly utilize engine oil and, in fact, to improperly burn off and/or consumer abnormally high amounts of oil.??? 60.??Yet, Plaintiff alleges that, from December 2011 through June 24, 2013, these symptoms of the engine defect had repeatedly manifested themselves.??Thus, a reasonable person would have investigated whether such an engine defect was known by Defendant to have existed.
????????????Indeed, Plaintiff alleges in her 2AC that she discovered Defendant?s wrongful conduct when she requested a buyback of the vehicle in June 2017.??2AC, ? 75.??However, Plaintiff does not allege why she could not have reasonably discovered such defect with reasonable diligence beginning no later than June 2013, given the eight repair attempts over 1 ? year period, less than 3 years after she bought the vehicle.??The delayed discovery rule will not operate to avoid application of the statute of limitations if the only reasonable conclusion is that Plaintiff should have known there was an excessive oil consumption problem with the engine, and should have with reasonable investigation learned that Defendant knew about his defect:
??[W]hen a plaintiff?reasonably should have discovered facts?for purposes of the accrual of a ca[u]se of action or application of the?delayed discovery?rule is generally a?question?of?fact,?properly decided as a matter of law only if?the evidence (or, in this case, the allegations?in?the complaint and facts properly subject to judicial notice)?can support only one reasonable conclusion.? [Citations.]?
Rosas v. BASF Corp.?(2015) 236 Cal.App.4th?1378, 1394 (bold emphasis and underlining added).
????????????Additionally, Plaintiff alleges that the applicable statute of limitations for her fraudulent omission claims was tolled by equitable tolling in the matter of the class action,?Parenteau v. General Motors, LLC?(C.D, Cal. No. 14-04961), filed on June 25, 2014, on behalf of owners of 2010 Chevrolet Equinox vehicles equipped with a 2.4L engine, which included Plaintiff as a class member, and was dismissed on September 17, 2015.??2AC, ? 15.??This is a period of 449 days (1 year, 2 months, 23 days).??As noted above, however, absent an allegation why Plaintiff could not have with reasonable diligence discovered there was an excessive oil consumption problem with the engine, and should have with reasonable investigation learned that Defendant knew about his defect soon then June 2013?her eighth repair attempt in less than three years of vehicle ownership?the?Parenteau?class action could not toll the statute of limitations because it would have already expired before the?Parenteau?class action was filed.
????????????The Court finds Defendant?s statute of limitations argument to be persuasive.
????????????The demurrer to the seventh cause of action is SUSTAINED.
Generally speaking, leave to amend must be allowed where there is a reasonable possibility of successful amendment.?Goodman v. Kennedy?(1976) 18 Cal.3d 335, 348.???Plaintiff must demonstrate this possibility at the hearing.??If he doesn?t, no leave to amend will be given.
Motion To Strike
Meet and Confer
????????????The Declaration of Joseph Dankert reflects that the meet and confer requirement set forth in CCP ? 435.5 was satisfied.
Discussion
????????????Defendant?s motion to strike the prayer for punitive damages at ? f., page 17:14 is GRANTED.???Whether leave to amend is granted or not will depend on whether leave is granted on the demurrer.
????????????By virtue of the ruling on the demurrer to the seventh cause of action for fraud by omission, that cause of action is currently not a viable basis to recover punitive damages for fraud, malice or oppression.
????????????As to the Song-Beverly Act, punitive damages are available:
?The Johnsons sued Ford and Decker for intentional and negligent misrepresentation and concealment,?violations of the Song-Beverly Consumer Warranty Act (Civ. Code, ?? 1790?1795.7) (Lemon Law), the Consumer Legal Remedies Act (Civ. Code, ?? 1750?1784), the unfair competition law (Bus. & Prof. Code, ?? 17200?17210), and the prohibition?on false or misleading advertising (Bus. & Prof. Code, ? 17500). Plaintiffs settled with Decker prior to trial and, after the jury verdict, voluntarily dismissed their unfair competition and false advertising causes of action against Ford.? (Johnson,?supra, 35 Cal.4th at pp. 1197?1198, fn. omitted.)
. . .
The jury awarded plaintiffs $ 17,811.60 in compensatory damages and punitive damages of $ 10 million. The Supreme Court summarized our disposition of defendant’s appeal: ?The Court of Appeal found substantial evidence not only that Ford had fraudulently concealed material facts from the Johnsons by?failing to provide them the warranty buyback notice required under section 1793.24, but also that?punitive?damages against the corporation were justified because ?defendant’s entire customer response program was structured precisely to short-circuit lemon law claims whenever defendant plausibly could,? by restrictively interpreting state lemon laws and ignoring the possibility of nonpresumptive lemons.? (Johnson,?supra, 35 Cal.4th at p. 1200.)?In conducting our de novo review of the punitive damages for constitutional excessiveness, however, we modified the $ 10 million judgment, concluding that punitive damages of $ 53,435 (three times the compensatory damages) was the maximum award permitted under the due process clause of the federal Constitution.
Johnson v. Ford Motor Co.?(2005) 135 Cal.App.4th 137, 141, 143 (bold emphasis added).
As we stated?in our earlier opinion in this case, the Song-Beverly Consumer Warranty Act is the most comparable statutory regulation of the kind of conduct involved in this case. Song-Beverly provides for a civil penalty equal to twice the compensatory damages award when the defendant has committed a ?willful? violation of the act. Here, however, the jury found, in essence, that defendant?intentionally?concealed information with the?intent?to defraud plaintiffs. Thus, on the one hand, the statutory scheme does not (with its double damages penalty) ?tend to support the present award of [$ 10 million] in punitive damages, a sum [560] times the financial harm defendant’s fraud caused plaintiff.? (Simon,?supra, 35 Cal.4th at p. 1184 [in?Simon?the bracketed amounts were $ 1.7 million and 340 times the compensatory damages, respectively].)?On the other hand, the present intentional conduct (based, as it was, on formal company-wide practices and policies) was?significantly more egregious than the?minimum ?willful? conduct sufficient to support a?Song-Beverly?civil penalty. Accordingly, in our view, the comparison with?Song-Beverly?does not begin to justify the $ 10 million?punitive?damages?award,?but?neither does?Song-Beverly?represent a legislative determination that?punitivedamages?for the intentional conduct before us must be limited to the lower end of the ordinary range of such damages.
. . .
We conclude that punitive damages of $ 175,000, or just less than 10 times the compensatory award, will sufficiently vindicate California’s ?legitimate interests in punishing unlawful conduct and deterring its repetition.? (BMW,?supra, 517 U.S. at p. 568.)
Johnson,?supra, 135 Cal.App.4th at 148-149, 150 (bold emphasis and underlining added).
????????????However, as to the Song-Beverly causes of action, Plaintiff has not factually pled malice, oppression, or fraud in connection with the violation of those causes of action, especially with the allegations in the seventh cause of action no longer being a part of the operative complaint.
????????????Defendant to give notice, unless waived.
IT IS SO ORDERED.
Dated:???October 29, 2018??????????????????????????????___________________________________
????????????????????????????????????????????????????????????????????????????????????Randolph M. Hammock
????????????????????????????????????????????????????????????????????????????????????Judge of the Superior Court