Case Number: BC661702 Hearing Date: July 26, 2019 Dept: 74
BC661702 LAZBEN INVESTMENT CO VS LAWRENCE M DEUTSCH
DEMURRER TO THE SECOND AMENDED COMPLAINT
TENTATIVE RULING: The demurrer to the ninth and tenth causes of action are sustained without leave to amend. The remaining demurrers are overruled. Lawrence Deutsch is to file an answer to the complaint within 20 days.
Background
The complaint alleges plaintiff is a family-owned partnership and defendant is a general partner. Plaintiff purchases real property and develops the properties as shopping centers, self-storage facilities and apartment complexes. Westbrook Development, LLC, an affiliate of plaintiff, has assigned its claims to Westbrook. Defendant currently provides no services to plaintiff and has no interest in it. Defendant held himself out as a representative of Westbrook, renting space and collecting rent and key money, which he kept. Defendant provides no current services to plaintiff. Defendant lives in property owned by plaintiff, and defendant was responsible for the costs of the property. Gas was shut off in the property due to a leak defendant refused to fix. Defendant leased the property to a production company, kept the rents, and failed to pay property taxes and insurance. Defendant collected rents on other residential properties which he kept. He paid personal expenses from plaintiff’s bank account. He ordered goods from a commercial tenant, and failed to pay for the goods. The complaint alleges causes of action in: (1) breach of contract; (2) breach of the covenant of good faith and fair dealing; (3) breach of fiduciary duty; (4) expulsion from partnership; (5) conversion; (6) quiet title; (7) quiet title; (8) ejectment; (9) declaratory relief; (10) declaratory relief; (11) constructive trust; (12) unjust enrichment; and (13) accounting.
The cross-complaint alleges defendant Lawrence Deutsch (hereafter “Lawrence”, first names are used as many of the parties to this action share the same last name) is the beneficiary of the trust which owns the property in which he resided. Lawrence paid to build a home on the real property, living in a smaller home on the same property until it was completed. False deeds were filed to transfer real properties from various trusts to plaintiff Lazben and affiliated LLCs. Lawrence has paid the property taxes and is owner of the property, subject to a deed of trust. Lazben attempted to remove Lawrence from the property through an unlawful detainer. Cross-defendants are attempting through illegal conduct to force Lawrence from the property and Lazben without compensation. They are withholding income from the companies, and interfering with his attempts to rent the property. The cross-complaint alleges causes of action in: (1) quiet title; (2) declaratory relief; (3) constructive trust; (4) slander of title; (5) judicial dissolution; (6) accounting; (7) breach of contract; (8) breach of fiduciary duty; (9) intentional interference with contractual relations; (10) intentional interference with prospective economic advantage; (11) receivership; and (12) fraud.
Lawrence demurs to the fifth, ninth, tenth, eleventh, twelfth and thirteenth causes of action on the grounds that they fails to state facts sufficient to constitute a cause of action and are uncertain.
Fifth, Eleventh, Twelfth and Thirteenth Causes of Action
Lawrence demurs to this cause of action on the grounds that there is a misjoinder of parties as the claims allege belong to Westbrook Development, LLC, and the allegations that the claims were assigned to Lazben are insufficient.
Allegations of an assignment to the plaintiff are sufficient to overcome a demurrer. (Stanton v. Pratt (1941) 18 Cal. 2d 599, 602.)
The demurrer is overruled on this ground.
Ninth Cause of Action for Declaratory Relief and Tenth Cause of Action for Declaratory Relief
An action in declaratory relief will not lie to determine an issue which can be determined in the underlying action. (Cal. Ins. Guar. Assoc. v. Superior Court (1991) 231 Cal. App. 3d 1617, 1623.) The object of declaratory relief as set forth in Code of Civil Procedure section 1061 is to afford a new form of relief where needed and not to furnish a litigant with a second cause of action for the determination of identical issues. (Id. at p. 1624.) The availability of another form of relief that is adequate will usually justify refusal to grant declaratory relief. (Ibid.)
Lazben counters Lawrence’s argument that the causes of action are duplicative of the breach of contract cause of action by stating that relief is sought in these causes of action which is not available in the breach of contract cause of action.
Lazben is partially correct. It is seeking to quiet title and remove Lawrence from the property. However, the causes of action for quiet title provide the title relief Lazben is seeking, and the cause of action for ejectment will provide the possession relief it is seeking. The declaratory relief causes of action are duplicative of other causes of action.
The demurrer is sustained without leave to amend.
Eleventh Cause of Action for Constructive Trust
To impose a constructive trust, the plaintiff must allege: (1) the existence of a res (property or some interest in property); (2) the plaintiff’s right to that res; and (3) the defendant’s gain of the res by fraud, accident, mistake, undue influence, the violation of a trust or other wrongful act. (Lazar v. Hertz Corp. (1983) 143 Cal. App. 3d 128, 139.)
When the elements are pleaded, a cause of action is stated. The cause of action alleges Lawrence received money and benefits which belong to Lazben, the benefits are described, and that Lawrence’s gain of the money and benefits was wrongful.
The demurrer is overruled.
Twelfth Cause of Action for Unjust Enrichment
Unjust enrichment does not describe a theory of recovery, but an effect: the result of a failure to make restitution under circumstances where it is equitable to do so. (Melchior v. New Line Productions, Inc. (2003) 106 Cal. App. 4th 779, 793.) Unjust enrichment is synonymous with restitution. (Ibid.) Where a plaintiff pleads and proves restitution, he may recover under unjust enrichment. (Ibid.)
This cause of action alleges Lawrence received and retained money and benefits belonging to Lazben and which should returned to Lazben. The demurrer is overruled.
Thirteenth Cause of Action for Accounting
A cause of action for an accounting requires a showing that a relationship exists between the plaintiff and defendant that requires an accounting, and that some balance is due the plaintiff that can only be ascertained by an accounting….” (Teselle v. McLoughlin (2009) 173 Cal.App.4th 156, 179.)
This cause of action alleges a relationship between Lawrence and Lazben, that Lawrence misused assets belonging to Lazben, and that an accounting is necessary to determine the funds Lawrence acquired which belong to Lazben. The demurrer is overruled.