Case Name: Philip L.B. Scott, et. al., v. Miller, Morton, Caillat & Nevis, LLP, SCA, et. al.

Case No.: 17CV311567

I. Background

This case brought by Dr. Philip L.B. Scott, his attorney, guardian ad litem Andre Hary, and Andre Hary, Successor Trustee of the Philip L.B. Scott Declaration of Trust Agreement, (“Plaintiffs”) against Miller, Morton, Caillet & Nevis, LLP, and several attorneys in that law firm (“Defendants”), arises from legal services provided by Defendants to Plaintiff in a business dispute.

According to the allegations of the Third Amended Complaint, (“TAC”), AAA Mini Storage is a storage business. Mr. Walter E. Parks (“Mr. Parks”) owned the business, and had refinanced it with 866 Inc. Profit Sharing Plan, Inc. (“866”). 866 refused to renew or extend a loan to Mr. Parks without additional security. William Strohmeyer, a mortgage broker, contacted Dr. Scott on Mr. Parks’ behalf. Mr. Strohmeyer ask if Dr. Scott would become a new lender, replacing 866. Dr. Scott declined to replace 866 as the lender, or provide money. Instead, Dr. Scott agreed to co-sign the loan with Mr. Parks, and provide a first deed of trust on a property he owned as security. In exchange, Dr. Scott would receive a 25% interest in the AAA Mini Storage property and business, and a grant deed for his 25% interest. Dr. Scott became co-obligor on this loan and a co-owner of AAA Mini Storage. Subsequently, Plaintiffs learned that both the loan Dr. Scott was co-obligor for, and an earlier loan against the AAA Mini-storage business, were in default.

In response to the default, Dr. Scott, and Mr. Strohmeyer formed Willscott, LLC. Plaintiffs’ intent was to transfer ownership of the storage business to Willscott, LLC. Defendants advised Plaintiff on this action, but did not inform Plaintiffs’ that taking this action would subject Plaintiffs to liability from Mr. Parks. Defendants knew or should have known such Dr. Scott had fiduciary duties to Mr. Parks. Nor did Defendants at any time disclose the potential for malpractice liability related to their handling of the takeover. On the advice of Defendants, Dr. Scott paid off the relevant loan on the property, and assigned the deed of trust to Willscott, LLC. Plaintiffs then commenced foreclosure against AAA storage. Mr. Parks filed for bankruptcy, leading to a bankruptcy proceeding involving Willscott, LLC. Eventually, Willscott, LLC bought the property for a credit bid. Willscott, LLC then expelled Mr. Parks from the property and took over control of the property. Thereafter, Parks sued Plaintiffs, alleging the takeover of the property was improper. Plaintiffs retained Defendants to defend the action. In defending the action, Defendants told Dr. Scott that Mr. Parks had no case, and pushed Dr. Scott to proceed to trial. The jury found for Mr. Parks, and awarded damages over 1.3 million dollars against Dr. Scott.

During the course of the litigation Defendants took various actions against Mr. Scott’s wishes. For instance, during the time of that litigation Andre Hary was a financial advisor for Dr. Scott. Dr. Scott, Andre Hary, and one defendant agreed that Defendants would communicate with Mr. Hary regarding this legal matter, due to Dr. Scott’s declining health. Defendants failed to communicate with Mr. Hary. Furthermore, Defendants proceeded to trial, contrary to Dr. Scott’s express wishes to avoid the expense of trial.

Defendants also advised Plaintiffs incorrectly, and failed to take various actions they should have taken. Defendants incorrectly advised Plaintiffs that Mr. Parks had a weak case. Defendants did not advise Dr. Scott of their potential malpractice in assisting him with the takeover. Defendants failed to properly discuss the potential costs and benefits of going to trial in this case with Plaintiffs. Defendants failed to propound discovery, and did not appoint a damage expert.

According to Plaintiffs, these failures to follow Plaintiffs’ direction and other errors were intentionally or recklessly committed by Defendants to help them charge attorneys’ fees for unnecessary services.

Plaintiffs assert four causes of action in the TAC: (1) professional negligence; (2) breach of contract; (3) breach of fiduciary duty; and (4) financial elder abuse.

Defendants demur only to the fourth cause of action for financial elder abuse. This demurrer follows a previous demurrer to the Second Amended Complaint, which was sustained as to the financial elder abuse claim. The previous demurrer was sustained with leave to amend, based upon failure to allege with particularity Defendants wrongfully used the attorney’s fees or accepted fees with the intent to defraud. The Court remarked “To the extent Plaintiffs’ theory is that Defendants intended to defraud Scott or wrongfully took his property because they accepted attorney’s fees for unnecessary legal services arising from the position they took in the underlying litigation, they do not clearly plead such a theory with particularity.”

Currently before the Court is Defendants’ demurrer to the fourth cause of action in the TAC, for financial elder abuse. Defendants argue Plaintiffs do not pled elder abuse with sufficient particularity.

II. Request for Judicial Notice

Defendants request judicial notice of some sixteen documents related to the underlying case between Dr. Scott and Mr. Parks, as well as a related bankruptcy proceeding. The court may consider as grounds for a demurrer any matter that is judicially noticeable under Evidence Code sections 451 or 452. (Code Civ. Proc., § 430.30, subd. (a).) Defendants submitted a separate request for judicial notice, (“RJN”) as required by the California Rules of Court. (See Cal. Rules of Court, rule 3.1113, subd. (l).) Plaintiffs filed an opposition to this request for judicial notice.

As a preliminary matter Defendants do not distinctly identify the precise legal basis for requesting judicial notice. Rather, Defendants simply cite Evidence Code section 452, and Evidence Code section 453, at the beginning of the RJN. While Evidence Code sections 452, and 453 do provide various reasons for granting judicial notice, Defendants do not clarify which subsection they assert applies. Where it is obvious which applies, the Court will use its judgment.

A. Court Records

Several of the documents in the RJN are court records from the bankruptcy proceeding In re Walter E. Parks, United States Bankruptcy Court, Northern District of California, Case Number 11-30595-TC. These include: (E) Motion for Relief From Automatic Stay or in the Alternative for Adequate Protection filed by Julie Rome-Banks on behalf of Willscott, LLC; (F) Motion for Relief From Automatic Stay or in the Alternative for Adequate Protection filed by Julie Rome-Banks on behalf of Willscott, LLC; (G) Online Case Docket; (I) Opposition to Motion for Relief From Automatic Stay on in the Alternative for Adequate Protection filed by Walter E. Parks; (J) Adversary Complaint filed by Walter E. Parks against Willscott, LLC and Philip L.B. Scott; (K) Reply to Opposition to Motion for Relief From Automatic Stay or in the Alternative for Adequate Protection filed by Julie Rome-Bans on behalf of Willscott, LLC; and (M) Order Granting Relief from Stay; (O) Proof of Service of Summons.

Court records are proper subjects of judicial notice. (Evid. Code §§ 451, 452 subdivision (d).) The Court does not consider the truth of hearsay statements in a court document simply because judicial notice has been taken of the document. (See Sosinsky v. Grant (1992) 6 CA4th 1548, 1564-1569, 8 CR2d 552, 561-565; Fremont Indem. Co. v. Fremont Gen. Corp. (2007) 148 CA4th 97, 113, [judicial notice of contents of court documents improper].)

Based upon the forgoing, judicial notice is GRANTED as to these documents.

B. Recorded Documents

Defendants also request judicial notice of several recorded documents related to real property. These include: (A) Notice of Default and Election to Sell Under Deed of Trust recorded on December 8, 2010; (B) Notice of Default and Election to Sell Under Deed of Trust recorded December 21, 2010; (L) the Assignment of Deed of Trust recorded on February 16, 2011; (N) the Deed of Trust recorded on November 5, 2009 attached as Exhibit A to Willscott, LLC’s Motion for Relief for Automatic Stay; (O) Trustee’s Deed Upon Sale, certified by American Title Insurance Company to be a Copy of the Document recorded on July 11, 2011.

Recorded documents are proper subjects of judicial notice, pursuant to Evidence Code section 452, subdivision (c), which permits judicial notice of any official acts of the legislative, executive, and judicial departments of the United States and of any state of the United States. (Evid. Code § 452, subd. (c); see also Fontenot v. Wells Fargo Bank, N.A. (2011) 198 Cal.App.4th 256, 264-65 [“a court may take judicial notice of the fact of a document’s recordation, the date the document was recorded and executed, the parties to the transaction reflected in a recorded document, and the document’s legally operative language . . . [and, f]rom this, the court may deduce and rely upon the legal effect of the recorded document”].)

Based upon the forgoing, judicial notice is GRANTED as to these documents.

C. Other Documents

Defendants also request judicial notice as to several other documents. These are: (C) the Operating Agreement of Willscott, LLC entered into by Philip L.B. Scott and William M. Strohmeyer on January 18, 2011; (D) the Limited Liability Company Articles of Organization of Willscott, LLC; (E) the Agreement To Purchase Promissory Note and Deed of Trust between Dr. Scott, and 866 Inc. Profit Share.

Plaintiffs argue in their reply that courts have taken judicial notice of articles of organization. Courts have indeed taken judicial notice of the existence of such documents. (See Cody F. v. Falletti (2001) 92 Cal.App.4th 1232, 1236, fn.2 [allowing judicial notice of articles of incorporation]; Cal. Aviation Council v. County of Amador (1988) 200 Cal.App.3d 337, 344 fn.7.) However, as with court records, judicial notice of the existence of corporate documents does not imply judicial notice was taken of their contents. (See People v. Thacker (1985) 175 Cal.App.3d 594, 598-599.)

Although documents related to the formation of a limited liability corporation are generally filed with the state, private documents filed with the state do not become judicially noticeable by such filing. (See Stevens v. Superior Court (1999) 75 Cal.App.4th 594, 607–608 [“Papers prepared by private parties but filed with state and federal agencies are not official government acts, and are not proper subjects of judicial notice.”]; Hughes v. Blue Cross of Northern California (1989) 215 Cal.App.3d 832, 856, citing Evid. Code, § 452, subd. (c).) Judicial notice of private documents is inappropriate because the Court has no way to determine that these documents are indisputably true. (See Mack v. State Bd. of Education (1964) 224 CA2d 370, 373, 36 CR 677, 679; Evid. Code § 454.)

Accordingly, the Court GRANTS judicial notice as to (C) and (D), but DENIES judicial notice of the contents of (C) and (D). The Court DENIES judicial notice of the Agreement To Purchase Promissory Note and Deed of Trust, because it is nothing more than a private document.

III. Documents Attached to Opposition

Plaintiffs attach several documents to their opposition. Defendants filed objections to these documents. The Court did not consider these documents because the court cannot consider extrinsic evidence on demurrer. Rather, the court is limited to the relevant pleading and judicially noticeable matters. The attached documents are neither, and thus the court did not consider them.

IV. Merits of Demurrer

Defendants argue that Plaintiffs’ allegations lack the requisite specificity. Defendants divide Plaintiffs complaint into two general theories. First, Defendants took money in the form of attorney’s fees to defend Dr. Scott, in which they knew they had a conflict of interest. Second, Plaintiffs claim Defendants took money in the form of attorney’s fees for unnecessary legal services by advising Dr. Scott that Mr. Parks had no legal basis for his claims, causing Dr. Scott to go to trial.

A. Taking Money While Knowing of a Conflict of Interests

1. Existence of Conflict of Interests

First, Defendants dispute whether there was in fact any conflict of interest with regard to their representation of Willscott, LLC in the takeover plan. Defendants assert that there was no conflict of interest in that, “[a]t the time of the takeover plan, the interests of Dr. Scott, Strohmeyer and Willscott, LLC were aligned.” (Dem., p. 13:13-14.) Plaintiffs assert Defendants have not alleged any specific conflict of interests “arising from Miller Morton’s allege joint representation of Dr. Scott, Strohmeyer and Willscott, LLC regarding the takeover plan.” (Id., p. 13:15-16.)

Plaintiffs describe two different conflicts of interests in the TAC. Plaintiffs allege one conflict of interest running being between Defendants and Plaintiffs stemmed from Plaintiffs’ bad advice. (See TAC, ¶ 9 (“When Dr. Scott contacted [Defendants] upon being served with the Parks’ complaint, [Defendants] did not disclose to Dr. Scott, Strohmeyer or Willscott any potential or actual conflicts stemming from [Defendants’] participation in the take-over plan and the fact that the conduct for which Dr. Scott was being sued was the conduct Miller Morton had approved and itself engaged in”].) Plaintiffs allege a second conflict of interest stemming from Plaintiffs’ multi-party representation of Dr. Scott, Willscott, LLC, and Strohmeyer simultaneously. (See TAC, ¶ 6 [“At this time and no time thereafter did Defendants inform Dr. Scott or Strohmeyer that there was an existing or potential conflict of interest were Defendants to represent Dr. Scott and the LLC or Strohmeyer”].)

Insomuch as Defendants assert there was no conflict between Dr. Scott, Strohmeyer and Willscott, LLC, such argument ignores the allegation of a conflict of interest between Defendants and Plaintiffs. Plaintiffs do not need to allege both conflicts of interest to show intent. Even if Defendants were to conclusively prove through judicial notice that Defendants had not pled any conflict of interest between Dr. Scott, Willscott, LLC, and Strohmeyer, it would not result in a sustainable demurrer because of the remaining conflict. (See PH II, Inc. v. Superior Court (1995) 33 Cal.App.4th 1680, 1682 [“A demurrer will lie against part of a cause of action”].) The demurrer is not sustainable on this basis.

2. Causation of Unnecessary Legal Fees

Defendants next contend that Plaintiffs have not pled how failing to disclose the conflict of interest lead to unnecessary legal costs, or pled with particularity what unnecessary legal fees would not have occurred but for the conflict of interest. Defendants assert statutory claims, including elder abuse, must be pled with particularity. (See Covenant Care, Inc. v. Superior Court (2004) 32 Cal.4th 771, 790.)

Defendants seem to misunderstand Plaintiffs’ claim. Plaintiffs’ claim that the poor advice given regarding the takeover created the need for the underlying action. Defendants then continued to work on the case all the way through trial motivated by a desire for attorney’s fees and to conceal the previous bad advice. In that respect, the TAC is reasonably read to mean that all attorney’s fees in the underlying action were unnecessary and caused by Defendants’ errors, greed, or concealment. (TAC, ¶¶ 8-9 [“The essence of Parks’ claim against [Plaintiffs] arose out of the very take-over plan formulated and carried out in accordance with advice given by Miller Morton . . . the conduct for which Dr. Scott was bring sued was the conduct that Miller Morton had approved and itself engaged in”].) Therefore, Defendants demurrer is not sustainable on the basis of a failure to allege causation with particularity.

3. Defendants’ Involvement In Takeover

Defendants also claim that they were not involved in the takeover plan, arguing that steps of the takeover plan occurred before they were allegedly consulted in February 2011. This argument is based upon Defendants’ RJN, supposedly showing Dr. Scott and Strohmeyer had created Willscott, LLC “before Miller Morton became involved and approved the ‘takeover plan.’” (Dem. p. 14:1-9.) Specifically, Defendants rely on the recorded Notice of Default and Election to Sell Under Deed of Trust to show foreclosure proceedings began in December of 2010, well before their allege involvement in February of 2011. Also, Defendants rely on documents related to the establishment of Willscott, LLC before February of 2011, including the operating agreement and articles of organization. The Court declined to take judicial notice of the documents surrounding the formation of Willscott, LLC. Thus, they cannot support Defendants’ argument.

To be resolved on judicial notice a fact must be beyond reasonable dispute. (See Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 113, 55 Cal.Rptr.3d 621.) Plaintiffs have alleged that Plaintiffs retained Defendants “on or before early February 2011, to provide their advice[.]” (TAC, ¶ 6.) Also, Defendants provided legal services to Dr. Scott in various matters from 2006 onward. Thus, the TAC is entirely consistent with Defendants advising Plaintiffs earlier than February of 2011, including at the time when the Notice of Default was entered in late 2010. No matter how construed, the Notice of Default and Election to Sell Under Deed of Trust, dated in late 2010, does not indisputably show Defendants arrived too late to advise Plaintiffs regarding the takeover.

Judicially noticed documents do not affirmatively prove that Defendants arrived too late to be involved in approving the takeover plan. Thus, the Court will not disregard the allegations of the TAC on this issue.

4. Independent Counsel

Additionally, Defendants argue that Plaintiffs had independent counsel at the time of the takeover. Thus, there was no conflict between Defendants and Plaintiffs. Defendants’ claim is based upon judicial notice of several documents in the bankruptcy proceeding. These documents do not support Defendants’ claims. They show that an attorney named Julie Rome-Banks represented Willscott, LLC in the bankruptcy proceeding. The fact that another attorney filed papers in bankruptcy court on behalf of Willscott, LLC does not make it indisputably true that Dr. Scott himself had independent counsel. (See RJN, Ex. E & K.) Nor does the complaint filed by Mr. Parks’ attorney support this contention. (See RJN Ex. J.) Thus, this argument is insufficiently supported.

5. Causation of the Underlying Suit

Next, Defendants argue that Mr. Parks filed the suit prior to action by Willscott, LLC, so any advice given by Defendants related to the takeover could not have caused the suit. Defendants do not cite to their RJN, and it is unclear what document they are relying on in making that assertion. The Court is limited to considering the TAC and matters judicially noticeable on demurrer. (See Big Valley Band of Pomo Indians v. Superior Court (2005) 133 Cal.App.4th 1185, 1190, 1192.) If Defendants rely upon the summons which is part of their RJN, it is dated in late 2012, which is long after the other documents in the RJN show the takeover occurred.

In the absence of judicially noticeable documents directly contrary to the TAC, the Court must accept the TAC as true. (See Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App3d 593, 604 [absent judicially noticeable facts, court must accept pleadings].) Generally speaking, the TAC alleges that Defendants’ deficient advice was a cause of the underlying suit. Furthermore, even if Defendants did not cause the underlying suit, the elder abuse claim could still be adequately pled based upon intentional charging of unnecessary attorney’s fees.

In sum, Defendants first line of argument is unavailing and the demurrer is not sustainable on that basis.

B. Taking Money in the Form of Unnecessary Legal Fees

1. Lack of Wrongful Use or Intent to Defraud

Defendants also argue that any allegation they took money from Plaintiff through unnecessary attorneys’ fees is nothing more than an allegation they “made a judgment call and pursued a litigation strategy that proved unsuccessful at trial.” (Dem., p. 14:14-19.) Therefore, according to Defendants, there is no allegation that Defendants took Plaintiffs’ property for wrongful use. This is a challenge to the third element of an elder abuse claim, requiring “wrongful use of the property or intent to defraud the elder.” (See Welf. & Inst. Code, § 15610.30.) Defendants repeat this argument in their reply with some modification.

Plaintiffs direct the Court’s attention to several allegations of concealment, presumably to show Defendants’ intent to defraud. Plaintiffs allege Defendants told Plaintiffs that Mr. Parks had a weak case and Defendants would not be liable at trial. Additionally, Defendants failed to communicate with Plaintiffs regarding the potential costs and benefits of going to trial. Furthermore, Defendants communicated with Dr. Scott, contrary to an agreement to communicate with Mr. Hary because of Dr. Scott’s declining health. Finally, Defendants failed to disclose Defendants’ own potential malpractice stemming from their legal advice to Plaintiffs. Plaintiffs argue Defendants concealed various facts from them, evidencing intent to defraud.

As Plaintiffs note, concealment is a species of fraud. Fraud must be pled with specificity. (Linear Technology Corp. v. Applied Materials, Inc. (2007) 152 Cal.App.4th 115, 132.) This specify requirement includes specifically pleading intent; conclusory allegations of bad faith are not sufficient. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 347 [“[M]ere conclusory allegations that the omissions were intentional and for the purpose of defrauding and deceiving plaintiffs […] are insufficient for the foregoing purposes”].)

Here, to support the third element of their elder abuse claim Plaintiffs have alleged several actions that they argue are concealment – and which may be concealment, if Plaintiffs prove they were done or taken with the requisite intent. Plaintiffs allege these purported omissions were intentional, and that they were made intentionally, with the purpose of obtaining unnecessary legal fees and/or concealing their own alleged malpractice. These allegations are now pleaded with sufficient specificity to allege the factual basis supporting the required element of “intent to defraud”.

Accordingly, the demurrer will be overruled on this ground.

2. Mere Negligent Legal Advice

Defendants characterize the TAC as alleging Defendants charged Plaintiffs’ attorney’s fees for allegedly negligent advice. Defendants’ discuss Delaney v. Baker (“Delaney”) (1999) 20 Cal.4th 23, 32, which states “the acts proscribed by section 1567 do not include acts of simply professional negligence, but refer to forms of abuse or neglect performed with some state of culpability greater than mere negligence.” In Delaney, the California Supreme Court found a distinction between recklessness and mere professional negligence in elder abuse. (See Delaney, supra, 20 Cal.4th at 31-32.) The court indicated that the elder abuse statute did not include simple negligence based upon inadvertence, incompetence, unskillfulness. (See Delaney, supra, 20 Cal.4th at 31-32.) Rather, it required a more culpable mental state. (Ibid.)

Plaintiffs counter that if they can show deliberate intentional abuse, case law supports an elder abuse claim based upon legal malpractice. Plaintiffs cite Wood v. Jamison (2008) 167 Cal.App.4th 156, 164. In that case, a lawyer convinced an elderly woman to provide substantial monies to him. (Ibid.) Without the elder’s knowledge, the lawyer intentionally used that money to secure loan for a third party, and kept a “finder’s fee” of several thousand dollars for himself. (Ibid.) Defendants’ citation to Delaney is apt, but Defendants’ argument ignores several allegations in the TAC. In the TAC Plaintiffs have alleged a theory of intentional or reckless conduct with the aim of charging legal fees for unnecessary work. In taking the alleged actions, according to TAC, Defendants “placed their pecuniary above those of the [sic] Dr. Scott’s.” (TAC, ¶ 65.)

The Court must accept the pleadings as true, and cannot weigh the likelihood of their truth at this stage. (See Del E. Webb Corp. v. Structural Materials Co. supra, 123 Cal.App.3d at 604 [“As a general rule in testing a pleading against a demurrer the facts alleged in the pleading are deemed to be true, however improbable they may be”].) Admittedly, many or all of the actions or inactions described in the TAC might well have been the result of an unsuccessful legal strategy pursued in good faith, miscommunication, a good faith misreading of applicable law, or some form of professional negligence. If Defendants conduct was in good faith, and amounted to simple professional negligence, under Delaney, the elder abuse claim will not stand. (See Delaney, supra, 20 Cal.4th at 31-32 [discussing mental state required for elder abuse].) Yet Plaintiffs have alleged it was not negligent, but intentional or reckless. Whether Defendants’ motivation for certain strategic choices in the underlying litigation was pure or greedy is a factual issue which cannot be resolved on demurrer. (See Ramsden v. Western Union (1977) 71 Cal.App.3d 873, 879 [“A demurrer is simply not the appropriate procedure for determining the truth of disputed facts”].)

Accordingly, based upon the reasoning above, Defendants’ demurrer is not sustainable on the basis that the TAC alleges professional negligence.

C. Judicial Estoppel

Defendants assert Plaintiffs should be judicially estopped from arguing that “the alleged ‘takeover’ plan was negligent or that Dr. Scott believed he was engaged in a joint venture with Parks running AAA Mini Storage.” (Dem., p. 15:11-13.)

It is unclear how this would provide a basis for sustaining a demurrer and why Defendants have placed this argument in the midst of their section on insufficient particularity. At least some of Plaintiffs allegations do not depend upon Defendants being negligent, or any assertion by Dr. Scott that he was engaged in a joint venture. For instance, Plaintiffs’ allegation that Defendants falsely told Plaintiffs Mr. Parks had a weak case, and charged unnecessary attorney’s fees in pursuit of trial does not depend on either of these.

Never the less, the Court will address the arguments raised.

For context, the doctrine of judicial estoppel applies where the same party has taken two positions, the positions were taken in judicial or quasi-judicial administrative proceedings, the party successfully asserted the first position (i.e., the first tribunal adopted the position or accepted it as true), the two positions are totally inconsistent, the first position was not taken as a result of ignorance, fraud, or mistake. (Jackson v. Los Angeles (1997) 60 C.A.4th 171, 181.)

According to Defendants, Plaintiffs’ description of their position in bankruptcy court is distinct from the position taken in the TAC. This is argument is based upon documents in the RJN, which supposedly show that in bankruptcy court Plaintiffs’ claimed Dr. Scott was an obligor for his 25% interest and surety for 75% interest in the property. (RJN, Ex. E, L.) This position was successful in that the relief was granted from the stay. Whereas, in the TAC, Dr. Scott alleges he was a co-owner and tenant in common with Parks in both the property and the mini-storage business.

The Court granted the RJN of the court records relied upon by Defendants, but the noticed documents do not support Defendants’ argument. The Motion for Relief from Automatic Stay or in the Alternative for Adequate Protection, (RJN. Ex E) is not brought by Dr. Scott, but rather by Willscott, LLC. It is not indisputably true that representations made by Willscott, LLC were made by Dr. Scott. Quite the contrary, LLCs are distinct legal entities from their members. (See PacLink Communications Intern., Inc. v. Superior Court (2001) 90 Cal.App.4th 958, 963 [A corporation, including an LLC, is a distinct legal entity from its shareholders or members].) As Plaintiffs point out in their opposition, “Willscott, LLC, not Scott, was involved in the bankruptcy action.” (Opp., p. 16:15-16.)

In sum, the first element of judicial estoppel, the same party is taking the two positions, is not met. It is immaterial whether Dr. Scott takes a different position in the present litigation then Willscott, LLC, a different party, did in bankruptcy court. Defendants’ judicial estoppel arguments are therefore insufficient in that Defendant fails to show that Willscott, LLC and Dr. Scott are the same party.

V. Conclusion

For the reasons discussed above, the demurrer to the 4th cause of action is OVERRULED.