Case Name: Dely C. Juani v. HSBC Bank USA, N.A., et al.
Case No.: 2015-1-CV-284250

This is a dispute arising from alleged misrepresentations to a homeowner concerning a residential loan contract and deed of trust. Currently before the Court is the demurrer to the operative Second Amended Complaint (“SAC”) by Defendant HSBC Bank USA, N.A. (“Defendant”). The SAC, filed February 2, 2016, states a single cause of action for Intentional Misrepresentation.

As an initial matter the Court notes that Plaintiff’s 19 page opposition exceeds the page limits set forth in Rule of Court 3.1113(d). Papers filed in excess of page-limits without prior permission are considered in the same manner as late-filed papers. (Rule of Court 3.1113(g).) “A trial court has broad discretion to under rule 3.1300(d) of the California Rules of Court to refuse to consider papers served and filed beyond the deadline without a prior court order finding good cause for late submission.” (Bozzi v. Nordstrom, Inc. (2010) 186 Cal.App.4th 755, 765.) The Court has the discretion to disregard the opposition papers or those pages in excess of the limits set by the Rules of Court, but has reviewed and considered the entire pleading, despite its failure to comply.

The Court in ruling on a demurrer treats it “as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law.” (Piccinini v. Cal. Emergency Management Agency (2014) 226 Cal.App.4th 685, 688, citing Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) Facts appearing in exhibits attached to the complaint (part of the “face of the pleading”) are given precedence over inconsistent allegations in the complaint. (See Barnett v. Fireman’s Fund Ins. Co. (2001) 90 Cal.App.4th 500, 505 [“[T]o the extent the factual allegations conflict with the content of the exhibits to the complaint, we rely on and accept as true the contents of the exhibits and treat as surplusage the pleader’s allegations as to the legal effect of the exhibits.”])

Defendant’s demurrer to the SAC’s sole cause of action for Intentional Misrepresentation on the ground that it fails to state sufficient facts against Defendant HSBC Bank (see Demurrer at 2:3-4) is SUSTAINED.

“The elements of fraud are (1) the defendant made a false representation as to a past or existing material fact; (2) the defendant knew the representation was false at the time it was made; (3) in making the representation, the defendant intended to deceive the plaintiff; (4) the plaintiff justifiably relied on the representation; and (5) the plaintiff suffered resulting damages.” (West v. JPMorgan Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 792 [citation omitted].) “Fraud must be pleaded with specificity rather than with general and conclusory allegations. The specificity requirement means a plaintiff must allege facts showing how, when, where, to whom, and by what means the representations were made, and, in the case of a corporate defendant, the plaintiff must allege the names of the persons who made the representations, their authority to speak on behalf of the corporation, to whom they spoke, what they said or wrote, and when the representation was made.” (Id. at 793 [citation and quotation marks omitted].) Courts enforce the specificity requirement in consideration of its two purposes. (Id. at 793.) The first purpose is to give notice to the defendant with sufficiently definite charges that the defendant can meet them. (Ibid.) The second is to permit a court to weed out meritless fraud claims on the basis of the pleadings; thus, the pleading should be sufficient to enable the court to determine whether, on the facts pleaded, there is any foundation, prima facie at least, for the charge of fraud. (Ibid.)

The SAC continues to fail to sufficiently state a claim for intentional misrepresentation against Defendant. Plaintiff fails to specifically allege that any intentional misrepresentations were made to her by Defendant. In fact Plaintiff has not alleged any direct contact or communication between her and this Defendant. The claim as pled is solely based on alleged misrepresentations in documents by third party Rebecca Cosgrove. Exhibit 2 to the SAC establishes that during the relevant time period Ms. Cosgrove was an agent for non-party Mortgage Electronic Registration System (“MERS”) and this controls over any contrary allegations in the SAC at 66-68. The SAC itself is internally contradictory on this point as it also alleges at 25 that during the relevant time period Ms. Cosgrove was not an agent for Defendant or MERS but rather an employee of a law firm not alleged to have been retained by Defendant.

The general agency allegation in the SAC at 1 is insufficient to establish any agency as to any defendant. Such secondary liability allegations have been described by the Supreme Court as “egregious examples of generic boilerplate.” (Moore v. Regents of the Univ. of Cal. (1990) 51 Cal 3d 120, 134, fn. 12.) Where, as here, the operative pleading “does not allege any conduct on [the defendant’s] part caused any harm, loss or damage on the plaintiff[’]s[] part,” the inclusion of boilerplate agency allegations “do not result in the complaint stating a cause of action against” the defendant. (Falahati v. Kondo (2005) 127 Cal.App.4th 823, 829.) The more specific agency relationship between Cosgrove and MERS, established by ex. 2 to the SAC, controls over the general agency allegation. (See Garton v. Title Ins. & Trust Co. (1980) 106 Cal.App.3d 365, 376 [“specific allegations of a complaint [may] overcome [a] general allegation of agency by showing that no such relationship existed”].)

Further leave to amend is DENIED. (See Medina v. Safe-Guard Products (2008) 164 Cal.App.4th 105, 112 fn. 8 [“As the Rutter practice guide states: ‘It is not up to the judge to figure out how the complaint can be amended to state a cause of action. Rather, the burden is on the plaintiff to show in what manner he or she can amend the complaint, and how that amendment will change the legal effect of the pleading.’”] See also Drum v. San Fernando Valley Bar Ass’n. (2010) 182 Cal.App.4th 247, 253 [citing Medina].)