Case Name: Michelle Groleau v. Panion Group, LLC, et al.

Case No.: 16CV299461

(1) Defendants’ Amended Demurrer to Plaintiff’s First Amended Complaint
(2) Defendants’ Amended Motion to Strike Portions of Plaintiff’s First Amended Complaint

Factual and Procedural Background

Defendant SJ North First LP (“SJNF”) is the owner of record and/or manager responsible to maintain, repair and upkeep the hotel located at 1350 N. 1st Street in San Jose (“Subject Property”) in a lawful, safe, habitable condition. (First Amended Complaint (“FAC”), ¶24.)

On or about September 3, 2014, plaintiff Michelle Groleau (“Plaintiff”) entered into an agreement with SJNF to stay as a guest at the Subject Property. (FAC, ¶25.) Plaintiff stayed at SJNF’s hotel as part of her job as a traveling nurse/replacement nurse. (FAC, ¶26.) Plaintiff noticed a bed bug infestation a couple hours after staying as a guest at the Subject Property, identifying over 56 large red welts on her body caused by bed bug bites. (FAC, ¶27 – 28.) Defendant SJNF was aware of bed bug complaints in the room Plaintiff stayed prior to Plaintiff’s arrival. (FAC, ¶¶30 – 31.) Defendant allowed Plaintiff to stay at the Premises knowing that there was a bed bug infestation and knowing that room 229 was being treated for bed bugs. Defendant should have completed treatment, made sure the bed bugs are eradicated before allowing anyone to stay in at the infested property. (FAC, ¶86.)

On September 1, 2016, Plaintiff filed a complaint.

On July 20, 2017, the court issued an order allowing Plaintiff to amend her complaint to substitute SJNF for a Doe defendant. On November 21, 2017, the court (Hon. Folan) sustained SJNF’s demurrer and granted SJNF’s motion to strike Plaintiff’s complaint.

On December 6, 2017, Plaintiff filed her FAC against SJNF, among others, asserting causes of action for:

(1) Negligence – Premises Liability/ Failure to Warn – Negligence Per Se
(2) Nuisance
(3) Intentional Infliction of Emotional Distress
(4) Breach of Contract
(5) Breach of Covenant of Quiet Enjoyment

On April 25, 2018, Plaintiff substituted Pacifica San Jose, LP (“Pacifica”) for a Doe defendant.

On June 8, 2018, defendant Pacifica filed a demurrer and motion to strike portions of Plaintiff’s FAC.

On June 13, 2018, defendant Pacifica, together with defendant SJNF (collectively, “Defendants”), filed an amended demurrer and motion to strike portions of Plaintiff’s FAC. These two motions are now presently before the court.
I. Defendants’ demurrer to the FAC is OVERRULED.

A. Defendants’ demurrer to the fourth cause of action [breach of contract] in Plaintiff’s FAC is OVERRULED.

“A cause of action for breach of contract requires pleading of a contract, plaintiff’s performance or excuse for failure to perform, defendant’s breach and damage to plaintiff resulting therefrom.” (McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1489; see also CACI, No. 303.)

Initially, Defendants demur by arguing that Plaintiff has not attached the actual agreement or incorporated, by reference, the terms. “A written contract is usually pleaded by alleging its making and then setting it out verbatim (‘in haec verba’) in the body of the complaint or as a copy attached and incorporated by reference. (4 Witkin, California Procedure (4th ed. 1997) Pleading, §479, p. 572.) If the contract is written, “the terms must be set out verbatim in the body of the complaint or a copy of the written instrument must be attached and incorporated by reference.” (Otworth v. Southern Pacific Transportation Co. (1985) 166 Cal.App.3d 452, 459.) Alternatively, “[i]n an action based on a written contract, a plaintiff may plead the legal effect of the contract rather than its precise language.” (Construction Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 199.) “This is more difficult, for it requires a careful analysis of the instrument, comprehensiveness in statement, and avoidance of legal conclusions, and it involves the danger of variance where the instrument proved differs from that alleged; it is not frequently employed. Nevertheless, it is an established method.” (4 Witkin, California Procedure (4th ed. 1997) Pleading, §480, p. 573.)

Here, Plaintiff alleges she “entered into a valid agreement, setting forth the terms surrounding the Plaintiff’s stay at the Premises.” (FAC, ¶94.) However, absent from the FAC are any allegations setting forth what those terms are, either explicitly or by their legal effect. Plaintiff later alleges that Defendants “breached the agreement by failing to provide habitable Premises to Plaintiff.” (FAC, ¶98.) Plaintiff does not allege the existence of a specific contractual provision requiring Defendants provide habitable premises. Instead, Plaintiff alleges, in relevant part, “The purpose of the agreements was for Plaintiff to obtain a habitable room from Defendants in return for payment for that hotel room. Therefore, the contract presupposed that Defendants would put the Premises in condition suitable for a habitable hotel room.” (FAC, ¶96.)

“An implied in fact contract arises from conduct, without express words of agreement. [Citation.] Accordingly, ‘only the facts from which the promise is implied must be alleged.’” (4 Witkin, California Procedure (4th ed. 1997) Pleading, §487, p. 578.) “Whether or not an implied contract has been created is determined by the act and conduct of the parties and all the surrounding circumstances involved and is a question of fact.” (Del E. Webb Corp. v. Structural Materials Co. (1981) 123 Cal.App.3d 593, 611; see also CACI No. 305.) Here, there are enough allegations for Plaintiff to assert that an implied contract exists which requires Defendants to provide habitable premises. While it would have been better for Plaintiff to clarify that she is alleging the breach of an implied contract, the cause of action is not so uncertain that Defendants could not make this determination.

Accordingly, Defendants’ demurrer to the fourth cause of action in Plaintiff’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for breach of contract and on the ground that the pleading is uncertain [Code Civ. Proc., §430.10, subd. (f)] is OVERRULED.

B. Defendants’ demurrer to the second cause of action [nuisance] in Plaintiff’s FAC is OVERRULED.

Initially, Defendants demur to Plaintiff’s second cause of action by citing Koll-Irvine Center Property Owners Assn. v. County of Orange (1994) 24 Cal.App.4th 1036, 1041 where the court stated:

A nuisance may be both public and private, but to proceed on a private nuisance theory the plaintiff must prove an injury specifically referable to the use and enjoyment of his or her land. The injury, however, need not be different in kind from that suffered by the general public.

(Emphasis added.)

“A private nuisance cause of action requires the plaintiff to prove an injury specifically referable to the use and enjoyment of his or her land.” (Adams v. MHC Colony Park, L.P. (2014) 224 Cal.App.4th 601, 610; see also CACI, No. 2021.) Defendants apparently contend that Plaintiff has not sufficiently alleged that she was injured with reference to her use and enjoyment of land. Specifically, Defendants contend Plaintiff has not alleged that she was a lessee of real property. Defendants cite no legal authority which would require Plaintiff allege she was a lessee. Plaintiff alleges she was a guest at Defendants’ hotel and it is reasonably inferred that Plaintiff had a right to use and enjoy the hotel room assigned to her during her stay.

The chief distinction between a tenant and a lodger lies in the character of possession. A ‘tenant’ has exclusive legal possession of premises and is responsible for their care and condition. A ‘lodger’ has only the right to use the premises, subject to the landlord’s retention of control and right of access to them. To make one a tenant, as respects an owner’s liability for injuries sustained by occupant on the premises, he must have exclusive possession and control. Marden v. Radford, 229 Mo.App. 789, 84 S.W.2d 947, 954; see also 64 Yale Law Journal 391-411. When premises are under the direct control and supervision of the owner and rooms are furnished and attended to by him, he or his servants retaining the keys to them, a person renting such a room is a lodger and not a tenant.

(Stowe v. Fritzie Hotels (1955) 44 Cal.2d 416, 421 (Stowe); emphasis added.)

Even as a lodger, Plaintiff had a right to use the premises. “A nuisance is an interference with the interest in the private use and enjoyment of the land and does not require interference with the possession.” (McBride v. Smith (2018) 18 Cal.App.5th 1160, 1178.)

Defendants argue next that the Plaintiff’s claim for nuisance fails because there are no allegations of malice. However, “A nuisance may be either a negligent or an intentional tort. If the latter, then exemplary damages are recoverable.” (Stoiber v. Honeychuck (1980) 101 Cal.App.3d 903, 920.) The absence of malice is not dispositive.

Accordingly, Defendants’ demurrer to the second cause of action in Plaintiff’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for nuisance is OVERRULED.

C. Defendants’ demurrer to the third cause of action [intentional infliction of emotional distress] in Plaintiff’s FAC is OVERRULED.

“The tort of intentional infliction of emotional distress is comprised of three elements: (1) extreme and outrageous conduct by the defendant with the intention of causing, or reckless disregard of the probability of causing, emotional distress; (2) the plaintiff suffered severe or extreme emotional distress; and (3) the plaintiff’s injuries were actually and proximately caused by the defendant’s outrageous conduct.” (Cochran v. Cochran (1998) 65 Cal.App.4th 488, 494 (Cochran); see also Ross v. Creel Printing & Publishing Co., Inc. (2002) 100 Cal.App.4th 736, 744 – 745; see also CACI, Nos. 1600 and 1602.)

Defendants initially demur to the third cause of action by arguing that the alleged conduct is not outrageous as a matter of law. “There is no bright line standard for judging outrageous conduct and its generality hazards a case-by-case appraisal of conduct filtered through the prism of the appraiser’s values, sensitivity threshold, and standards of civility. The process evoked by the test appears to be more intuitive than analytical.” (Cochran, supra, 65 Cal.App.4th at p. 494.) “Even so, the appellate courts have affirmed orders which sustained demurrers on the ground that the defendant’s alleged conduct was not sufficiently outrageous.” (Id.) The Cochran court went on to state, “the mere fact that the actor knows that the other will regard the conduct as insulting, or will have his feelings hurt, is not enough.” (Id. at p. 496.) “In evaluating whether the defendant’s conduct was outrageous, it is not enough that the defendant has acted with an intent which is tortious or even criminal.” (Id.)

“In order to state a cause of action for intentional infliction of emotional distress a plaintiff must show, [among other things], outrageous conduct by the defendant.” (Trerice v. Blue Cross of California (1989) 209 Cal.App.3d 878, 883.) “Conduct, to be ‘outrageous’ must be so extreme as to exceed all bounds of that usually tolerated in a civilized society. While the outrageousness of a defendant’s conduct normally presents an issue of fact to be determined by a trier of fact, the court may determine in the first instance, whether the defendant’s conduct may reasonably be regarded as so extreme and outrageous as to permit recovery.” (Id.)

Defendants contend the allegations do not show outrageous conduct and, on the contrary, evidence their reasonable conduct in attempting to eradicate the bed bug infestation. Defendants seemingly invite the court to take judicial notice of the fact that bed bugs are generally known to be difficult to eradicate. The court does not take judicial notice of such a fact. Defendants also point to paragraph 31 where it is alleged that “Plaintiff was informed that Defendant treated in a three-room rotation and that Plaintiff’s room was one of those three rooms.” Defendants ask the court to view this allegation as their attempt to correct the problem. However, Plaintiff alleges further at paragraph 86 that “Defendant acted outrageously by allowing Plaintiff to stay at the Premises knowing that there was a bed bug infestation and knowing that room 229 was being treated for bed bugs. Defendant should have completed treatment, made sure the bed bugs are eradicated before allowing anyone to stay in at the infested property.” In other words, Plaintiff is alleging that Defendants were in the process of correcting the problem, but placed Plaintiff in a room that was in still in the process of and had not yet completed treatment. The court finds this a sufficient allegation of outrageous conduct or, at the very least, will not decide this as a matter of law on a demurrer.

Accordingly, Defendants’ demurrer to the third cause of action in Plaintiff’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for intentional infliction of emotional distress is OVERRULED.

D. Defendants’ demurrer to the fifth cause of action [breach of covenant of quiet enjoyment] in Plaintiff’s FAC is OVERRULED.

Civil Code section 1927 states, “An agreement to let upon hire binds the letter to secure to the hirer the quiet possession of the thing hired during the term of the hiring, against all persons lawfully claiming the same.” “[T]he implied covenant of quiet possession … gives rise to duty in the landlord to preserve the quiet enjoyment of all tenants.” (Andrews v. Mobile Aire Estates (2005) 125 Cal.App.4th 578, 588 (Andrews); internal punctuation omitted.) “The covenant of quiet enjoyment protects not only ‘tenants’ per se but all ‘hirers’ of real property.” (Friedman et al., CAL. PRAC. GUIDE: LANDLORD-TENANT (The Rutter Group 2017) ¶4:1 citing Civ. Code §§1927 and 1940, subd. (a).)

Defendants contend the cause of action for breach of covenant of quiet enjoyment fails because Plaintiff has not attached a copy of the hotel agreement or set forth any of its terms. Since the covenant of quiet enjoyment is implied, the court is not persuaded by Defendants’ argument that the actual terms of the hotel agreement must be specifically pleaded. It is enough that Plaintiff has alleged the existence of an agreement with Defendants to stay as a guest at the Subject Property. (FAC, ¶25.) For purposes of demurrer, the court accepts this allegations as true.

Accordingly, Defendants’ demurrer to the fifth cause of action in Plaintiff’s FAC on the ground that the pleading does not state facts sufficient to constitute a cause of action [Code Civ. Proc., §430.10, subd. (e)] for breach of covenant of quiet enjoyment and on the ground that the pleading is uncertain [Code Civ. Proc., §430.10, subd. (f)] is OVERRULED.

II. Defendants’ motion to strike portions of the FAC is GRANTED, in part, and DENIED, in part.

Defendants move to strike various allegations from Plaintiff’s FAC. Initially, Defendants move to strike allegations relating to Plaintiff’s breach of contract and breach of covenant of quiet enjoyment causes of action. Defendants renew the arguments made in their demurrer to these same two causes of action and argue that, as contract claims, they cannot serve as the basis for punitive damages. For the reasons discussed above, the court is not persuaded by Defendants’ arguments regarding the sufficiency of the breach of contract and breach of covenant of quiet enjoyment claims. However, the court agrees that contract claims cannot serve as the basis for punitive damages. (See Civ. Code, §3294—“In an action for the breach of an obligation not arising from contract…”) Accordingly, Defendants’ motion to strike paragraph 109 and that portion of paragraph 3 from the prayer for relief which seeks “attorney’s fees” is GRANTED with 10 days’ leave to amend.

Defendants also ask this court to strike the Plaintiff’s claim for attorney’s fees because Plaintiff has not attached a copy of the contract or specifically pleaded the provision of the contract which allows for the recovery of attorney’s fees. Instead, Plaintiff alleges only that she “incurred reasonable attorneys’ fees and costs, pursuant to the rental agreement.” (FAC, ¶101.) The general rule set forth in Code of Civil Procedure section 1021 is, “that each party is to bear his or her own attorney fees unless a statute or the agreement of the parties provide otherwise.” (Gray v. Don Miller & Associates, Inc. (1984) 35 Cal.3d 498, 504.) Plaintiff has not adequately alleged that the agreement at issue here provides for the recovery of attorney’s fees. Accordingly, Defendants’ motion to strike paragraph 101 of the Plaintiff’s FAC is GRANTED with 10 days’ leave to amend.

Finally, Defendants move to strike Plaintiff’s claim for punitive damages. Pursuant to Civil Code section 3294, punitive damages may be recovered “where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice.” In G.D. Searle & Co. v. Superior Court (1975) 49 Cal.App.3d 22, 26 (Searle), the court wrote, “In California the award of damages by way of example or punishment is controlled by Civil Code section 3294, which authorizes that kind of award against a tortfeasor who has been guilty of ‘oppression, fraud or malice, express or implied.’” “Notwithstanding relaxed pleading criteria, certain tortious injuries demand firm allegations. Vague, conclusory allegations of fraud or falsity may not be rescued by the rule of liberal construction. When the plaintiff alleges an intentional wrong, a prayer for exemplary damage may be supported by pleading that the wrong was committed willfully or with a design to injure. When nondeliberate injury is charged, allegations that the defendant’s conduct was wrongful, willful, wanton, reckless or unlawful do not support a claim for exemplary damages; such allegations do not charge malice.” (Id. at p. 29; internal citations omitted; emphasis added.)

“In determining whether a complaint states facts sufficient to sustain punitive damages, the challenged allegations must be read in context with the other facts alleged in the complaint. Further, even though certain language pleads ultimate facts or conclusions of law, such language when read in context with the facts alleged as to defendants’ conduct may adequately plead the evil motive requisite to recovery of punitive damages.” (Monge v. Superior Court (1986) 176 Cal.App.3d 503 citing Perkins v. Superior Court (1981) 117 Cal.App.3d 1, 6 – 7.)

Here, Plaintiff has alleged an intentional wrong, i.e., the intentional infliction of emotional distress. Plaintiff alleges Defendants “intended to cause or consciously disregarded the near certainty that Plaintiff would suffer emotional distress, discomfort and annoyance.” (FAC, ¶88.) “Intent, like knowledge, is a fact.” (5 Witkin, California Procedure (4th ed. 1997) Pleading, §684, p. 143.) This is enough to support a claim for punitive damages.

Accordingly, Defendants’ motion to strike portions of Plaintiff’s FAC is otherwise DENIED.