Case Number: 18STCV06803 Hearing Date: March 02, 2020 Dept: 78

Superior Court of California

County of Los Angeles
Department 78

AEROSERVICIOS AVE., S.A., et al.;

Plaintiff,

vs.

SARKIS GARABETIAN, et al.;

Defendants.

Case No.:

18STCV06803Click here to enter text.

Hearing Date:

March 2, 2020

[TENTATIVE] RULING RE:

Defendants SARKIS GARBETIAN, S&S AVIATION SERVICES, INC., AND AVIATION SUPPLIES (NZ)’ DEMURRER TO PLAINTIFF’S UNVERIFIED COMPLAINT.

Defendants Sarkis Garbetian, S&S Aviation Services, Inc., and Aviation Supplies (NZ)’ Demurrer to Plaintiff’s Unverified Complaint is OVERRULED.

Factual Background

This is an action for fraud and conversion. The Complaint alleges as follows. Plaintiffs Aeroservicios, S.A. (“Avesa”) and Distribuidora Piper, S.A. (“Distribuidora”) are corporations organized and existing in Guatemala. (Compl. ¶¶ 1-2.) Around August 15, 2015, Plaintiffs owned a Rolls-Royce aircraft M250-C39O Engine, which had been in an accident. (Compl. ¶¶ 14.) Plaintiffs shipped the engine in August 2015 to Defendant Sarkis Garabetian (“Garabetian”) at Defendant S&S Aviation (“S&S”) in Los Angeles, a division of Defendant Aeromaritime America, Inc. (“Aeromaritime”). (Compl. ¶¶ 15-16.) On September 30, 2016, Avesa inquired into the status of the engine, and Garabetian informed Avesa that after it was received, disassembled, and inspected, it was found to be beyond economical repair and scrapped by S&S Aviation. (Compl. ¶ 19.) Just prior to this, Garabetian responded to an inquiry from Avesa about purchasing another M250-C30P engine and told Avesa that Aeromaritime had an overhauled M250-C30P available for $335,000. (Compl. ¶ 21.) The fact sheet accompanying the offer included a list of the component parts and their serial numbers, 90% of which matched the parts in the engine Avesa has shipped for repair. (Compl. ¶ 21.)

procedural history

Plaintiffs filed the Complaint on November 30, 2018, alleging three causes of action:

Conversion

Fraud

Conspiracy

On November 3, 2019, Garbetian, S&S, and Aviation Supplies (NZ) (the“Moving Defendants”) filed the instant Demurrer.

On November 12, 2019, Aeromaritime filed an Answer to the Complaint. On the same day, Aeromaritime filed a Cross-Complaint alleging three causes of action:

Equitable indemnity

Fraud

Declaratory relief

Plaintiffs have not filed an Opposition to the instant Demurrer.

Discussion

DEMURRER

A demurrer should be sustained only where the defects appear on the face of the pleading or are judicially noticed. (Code Civ. Pro., §§ 430.30, et seq.) In particular, as is relevant here, a court should sustain a demurrer if a complaint does not allege facts that are legally sufficient to constitute a cause of action. (See id. § 430.10, subd. (e).) As the Supreme Court held in Blank v. Kirwan (1985) Cal.3d 311: “We treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law. . . . Further, we give the complaint a reasonable interpretation, reading it as a whole and its parts in their context.” (Id. at p. 318; see also Hahn. v. Mirda (2007) 147 Cal.App.4th 740, 747 [“A demurrer tests the pleadings alone and not the evidence or other extrinsic matters. Therefore, it lies only where the defects appear on the face of the pleading or are judicially noticed. [Citation.]”)

“In determining whether the complaint is sufficient as against the demurrer … if on consideration of all the facts stated it appears the plaintiff is entitled to any relief at the hands of the court against the defendants the complaint will be held good although the facts may not be clearly stated.” (Gressley v. Williams (1961) 193 Cal.App.2d 636, 639.)

“A demurrer for uncertainty is strictly construed, even where a complaint is in some respects uncertain, because ambiguities can be clarified under modern discovery procedures.” (Khoury v. Maly’s of Cal., Inc. (1993) 14 Cal.App.4th 612, 616.) Such demurrers “are disfavored, and are granted only if the pleading is so incomprehensible that a defendant cannot reasonably respond.” (Mahan v. Charles W. Chan Insurance Agency, Inc. (2017) 14 Cal.App.5th 841, 848.)

A demurrer should not be sustained without leave to amend if the complaint, liberally construed, can state a cause of action under any theory or if there is a reasonable possibility the defect can be cured by amendment. (Schifando v. City of Los Angeles, supra, 31 Cal.4th at p. 1081.) The demurrer also may be sustained without leave to amend where the nature of the defects and previous unsuccessful attempts to plead render it probable plaintiff cannot state a cause of action. (Krawitz v. Rusch (1989) 209 Cal.App.3d 957, 967.)

Here, the moving Defendants demurrer to the Complaint as to all three causes of action.

ALL CAUSES OF ACTION – EXISTENCE OF A CONTRACT

The Moving Defendants argue that although the complaint alleges that there was an oral promise between the parties for repair of the engine, there was instead a contract for sale of the engine. (Motion at p. 10.) The Moving Defendants contend that the “lack of a written agreement is evidence of the non-existence of an agreement” per the Parol Evidence Rule.” (Motion at p. 10.)

Plaintiffs have not submitted an Opposition. However, for purposes of demurrer, it is irrelevant if the Moving Defendants that the contract was written rather than oral, as alleged in the complaint. Allegations of a complaint must be accepted as trust for the purposes of demurrer. (Brakke v. Economic Concepts, Inc. (2013) 213 Cal.App.4th 761, 767.) The Complaint in this case alleges that Garabetian told Plaintiffs that if they shipped the damaged engine, S&S would disassemble, inspect, and evaluate the engine, and then prepare a written report indicating the nature and extent of the damages. (See Compl. ¶ 39.) This is sufficiently alleges that there was an oral contract between the parties and the fact that it was not written is irrelevant the demurrer on the grounds that there was no contract is OVERRULED.

ALL CAUSES OF ACTION – STATUTE OF LIMITATIONS

The Moving Defendants argue that the statute of limitations for the fraud and conversion claims is three years and that, even with delayed discovery, the Complaint was filed late. (Motion at pp. 13-14.) The Moving Defendants contend that the purported damage to the engine took place in October 2014, and the engine was shipped around August 2015, thus that the Complaint should have been filed by August 2018. (Motion at p. 14.)

While Plaintiffs have not filed an Opposition, the Complaint alleges that in September 2016 they inquired as to the status of the engine and were informed on September 30, 2016 that the engine had been scrapped. (Compl. ¶¶ 19, 22.) Thus, on the face on the Complaint, the injury was discovered on September 30, 2016 and the filing of the Complaint on November 30, 2018 was well-within the three-year statute of limitations.

Further, if a complaint does not affirmatively show that a claim is barred, as in this case, it a demurrer on the grounds that the claim is barred by the statute of limitations must be denied. (California Safe Deposit & Trust Co. v. Sierra Valleys Ry. Co. (1910) 158 Cal. 690, 698.) Accordingly, the demurrer on the grounds that the claim is barred by the statute of limitation is OVERRULED.

FRAUD — SECOND CAUSE OF ACTION

The Moving Defendants argue that the Complaint fails to establish the element of reliance because Plaintiff waited over a year to inquire and because Plaintiffs allege only that “Defendants failed to comply with some arbitrary FAA Rules and Regulations because they failed to notify Plaintiffs that the engine was beyond repair and failed to obtain Plaintiff’s written authorization.” (Motion at p. 11.) The Moving Defendants also argue that the Complaint does not meet the heightened pleading standard for fraud. (Motion at p. 12.)

“The elements of fraud are (1) misrepresentation, (2) knowledge of falsity, (3) intent to induce reliance on the misrepresentation, (4) justifiable reliance on the misrepresentation, and (5) resulting damages.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.)) “To satisfy [the element of reliance] at the pleading stage a plaintiff must allege facts showing that he or she suffered an economic injury caused by the alleged violation. (Kwikset Corp. v. Superior Court (2011) 51 Cal.4th 310, 322, 326.)

The Complaint alleges that Garabetian made false representations to Plaintiff regarding the process that the engine would undergo, “with the intent that Plaintiffs would rely on them and think its engine was beyond repair, thereby agreeing to spend $335,000 on the purchase of an overhauled and refurbished engine. The representations made by Garabetian, and the other Defendants, were intended to induce Plaintiffs to take the actions they did and deliver the engine to Defendants, and each of them.” (Compl. ¶ 44.) This allegation reliance is further sufficient.

Additionally, because the Complaint also alleges circumstances establishing that it would be reasonable for Plaintiffs to rely on Garabetian, (with Garabetian travelling to Guatemala to meet with them, representing that S&S was licensed by the FAA, etc..) The complaint alleges facts sufficient to show that such reliance was justified.

Moving Defendants assert that fraud has a heightened pleading standard. The fraud “particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Lazar v. Superior Court, supra, 12 Cal.4th at 645.) But Moving Defendants do not provide any citations or examples of any deficiencies in the specificity of the allegations of the complaint. The complaint alleges that it was Garabetian who made the misrepresentations, it alleges what the misrepresentations were made, and, and it alleges how and why they were false.

Accordingly, the demurrer to the Second Cause of Action is OVERRULED

CONSPIRACY – THIRD CAUSE OF ACTION

“The elements of a civil conspiracy are: “(1) formation and operation of the conspiracy and (2) damage resulting to plaintiff (3) from an act done in furtherance of the common design.” (I-CA Enterprises, Inc. v. Palram Americas, Inc. (2015) 235 Cal.App.4th 257, 272 fn. 2.)

The Moving Defendants argue that conspiracy is not a cause of action, and that if there is a contract, it is vague as to the whether the parties agreed to repair or sell the damaged engine. (Motion at p. 13.) The Moving Defendants further contend that “it is completely unclear what act was defrauding Plaintiffs and what actions were taken in furtherance of the purported conspiracy.” (Motion at p. 13.)

As a preliminary matter, the Court finds that conspiracy is a legal cause of action.

The Complaint alleges that each of the Defendants “knowingly and willfully conspired and agreed among themselves to lie, deceive and mislead Plaintiffs” into shipping their damaged engine so that they could disassemble it and re-sell a refurbished engine back to Plaintiffs. (Compl. ¶ 49.)

As the Court stated in AREI II Cases (2013) 216 Cal.App.4th 1004, 1022 citing Choate v. County of Orange (2000) 86 Cal.App.4th 312, 333, 103 Cal.Rptr.2d 339.) “[A] complaint [alleging a conspiracy] is sufficient if it apprises the defendant of the “character and type of facts and circumstances upon which [plaintiff] was relying to establish the conspiracy.” citing Schessler v. Keck (1954) 125 Cal.App.2d 827, 833.) This is due to the nature of a conspiracy, wherein the existence frequently must be “inferentially and circumstantially derived from the character of the acts done, the relations of the parties and other facts and circumstances suggestive of concerted action.” (Id. citing Schessler, supra, 125 Cal.App.2d at p. 833.)

Accordingly, the demurrer is to the Third Cause of Action is OVERRULED.

Plaintiff to give notice.

DATED: March 2, 2020

________________________________

Hon. Robert S. Draper

Judge of the Superior Court