Case Number: KC066690 Hearing Date: June 25, 2014 Dept: J

Re: Adam C. Broyles, et al. v. Bank of America, N.A. (KC066690)

DEMURRER TO COMPLAINT

Moving Party: Defendant Bank of America, N.A.

Respondents: Plaintiffs Adam C. Broyles and Kimberly Avram

POS: Moving OK; Opposing served by regular mail contrary to CCP § 1005(c)

Plaintiffs’ Complaint, filed 2/25/14, asserts causes of action for:

1. Breach of Contract
2. Fraud
3. Negligence

The Case Management Conference is scheduled for 6/25/14.

In their Complaint, Plaintiffs allege that they purchased a two-story townhome located at 13822 Ramona, Baldwin Park, CA 91706 from Defendant in 2008; that the original Purchase Agreement included a detailed description of the property being sold which would include a detached two car garage (¶ 19); that the MLS listing and all other marketing materials produced by Defendant and its agents included a specific description that the garage was included in the listing (ibid.); that Defendant’s listing broker showed the garage to the Plaintiffs and represented that it would be included in the sale (id.); that the keys to the garage were delivered to the Plaintiffs, who were given dominion and control over the garage (id.); that Plaintiffs reliably made their mortgage and property tax payments (¶ 4); that in October of 2012, Plaintiffs received a Notice of Sale as a result of apparent unpaid taxes on the Property (¶ 5); that Plaintiffs became aware that the Property actually consisted of two parcels of land; that the garage was actually on a different parcel than the townhome (ibid.); that Plaintiffs notified Defendant of the alleged defect in title, but instead of correcting it, Defendant used over $4,000 from Plaintiffs’ escrow account to pay the delinquent taxes on a property which was still not owned by the Plaintiffs (¶ 6); that Defendant raised the mortgage payments by $500 to account for the deficiency in the escrow account (ibid.); that Plaintiffs’ December mortgage payment was insufficient; that Defendant immediately reported Plaintiffs payment to the credit bureaus as late (id.); that Defendant’s failure to timely correct the title defect has caused Plaintiffs to lose an offer of $305,000 for the Property, costing Plaintiffs $35,000 (¶ 14); that Plaintiffs have not been able to sell the property, forcing them to continue holding and maintaining the Property at a cost of $38,000 (¶ 15).

Defendant Bank of America (“Bank”) demurs to the second cause of action for fraud on the grounds that it fails to state facts sufficient to constitute a cause of action pursuant to CCP Section 430.10(e).

Judicial Notice:

“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, assuming there is no genuine dispute regarding the document’s authenticity. From this, the court may deduce and rely upon the legal effect of the recorded document, when that effect is clear from its face.” (Fontenot v. Wells Fargo Bank, N.A., 198 Cal.App.4th 256, 265).

Under Evidence Code § 453, the Court may take judicial notice of recorded documents, but only after a copy has been furnished to the opposing side to permit them the opportunity to object. Evidence Code § 453. Here, Defendant requests judicial notice of the following: (1) Grant Deed recorded 6/21/05; (2) Trustee’s Deed Upon Sale recorded 4/22/08; Grant Deed recorded 8/08/08; and (4) Grant Deed recorded 9/12/13. Plaintiffs have been served a copy of these documents, and have not objected to the request for judicial notice, which is granted.

SECOND CAUSE OF ACTION FOR FRAUD:

The elements of fraud are: a representation, usually of fact, which is false; knowledge of its falsity; intent to defraud; justifiable reliance upon the misrepresentation; and damages resulting from that justifiable reliance. (Stansfield v. Starkey (1990) 220 Cal.App.3d 59, 72-73). “In California, Fraud must be pled specifically; general and conclusory allegations do not suffice. Thus, the policy of liberal construction of the pleadings will not ordinarily be invoked to sustain a pleading defective in any material respect. This particularity requirement necessitates pleading facts which show how, when where, to whom, and by what means the representations were tendered.” (See Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 184). In the case of a corporate defendant, plaintiff must allege who made the misrepresentations as well as that individual’s authority to bind the corporation. These requirements serve as “a device to separate meritorious and non-meritorious cases” before trial. (Id.). In this case, Plaintiffs have failed to allege facts to support Defendant’s knowledge of the falsity. Further, most of the other elements are set forth with legal conclusions rather then ultimate facts.

The demurrer is sustained. The court will hear from counsel for Plaintiffs as to whether leave to amend is requested.