2016-00199650-CU-BC

Ezatullah Ghulam vs. Mohamad Aalemkhiel

Nature of Proceeding: Hearing on Demurrer to the First Amended Complaint

Filed By: Coleman, Michael

** If any party requests oral argument, then the hearing will take place at 9:00 AM in this department on Wednesday, March 14, 2018 . If this date is inconvenient for the parties, they shall meet and confer regarding a mutually convenient date and call the clerk in Department 54 by no later than 4:00 p.m on Monday, March 12, 2018 to notify the clerk of the new date. Any request for oral argument must still be made Monday, March 12, 2018, 4:00 p.m. (See Local Rule 1.06.) **

*** If oral argument is requested, the parties must at the time oral argument is requested notify the clerk and opposing counsel of the causes of action that will be addressed at the hearing. The parties are also reminded that pursuant to local court rules, only limited oral argument is permitted on law and motion matters. ***

Defendants Mohamad Aalemkhiel (“Mohamad”), Shakhofa Aalemkheil (“Shakhofa”) (collectively “Aalemkheil”) and East Eagle, LLC’s (“LLC”) (collectively “Defendants”) demurrer to Plaintiff Ezatullah Gulam’s first amended complaint (“FAC”) is ruled upon as follows.

Overview

This case arises from a joint investment in a grocery store and restaurant. Plaintiff alleges that in early 2015, he and his brother Zinatulla Gelaman (“Gelaman”) were approached by Mohamad to partner in opening an Afghan Restaurant/Grocery Store. For various reasons, Mohamed told Plaintiff that he needed to put the Partnership Agreement in his wife, Shakhofa’s name. Plaintiff executed a power of attorney with Gelaman who had agreed to invest in the grocery store but lives in the U.K. Gelaman was going to allow Plaintiff to work on his behalf in the Partnership, but wanted to be listed on any agreements and/or documents. (FAC, ¶ 5.)

On March 18, 2015, Mohamed emailed a draft of the Partnership Agreement to Plaintiff. The Partnership Agreement was already signed by Shakhofa. Plaintiff then forwarded

the executed agreement to Gelaman, who subsequently executed and returned it via email. Plaintiff then forwarded the completely executed Partnership Agreement back to Mohamad. (FAC, ¶ 6.)

Although Plaintiff and Gelaman had originally intended to start a new limited liability company, Mohamad informed them it was unnecessary because the LLC was already open, and he would add Plaintiff and Gelaman to the LLC. (FAC, ¶ 7.) Mohamed then informed them that it would take 90 days for the County to recognize and to legitimize the executed Partnership Agreement and only then he could add Plaintiff and Gelaman to the LLC. (FAC, ¶ 8.)

On March 20, 2015, Plaintiff and Mohamad entered into a lease agreement with Ethan Conrad Properties for a location. Plaintiff secured the electricity account under his name with Mohamad opening the bank accounts. (FAC, ¶ 9.) Plaintiff, Gelaman and Mohamed agreed that Mohamed would handle all banking and provide the brothers with a quarterly accounting. (FAC, ¶ 10.) Plaintiff began working at the store.

Plaintiff alleges that he consulted with an attorney regarding adding Plaintiff to the LLC or obtaining a new LLC. Plaintiff decided to obtain a new LLC, and on March 24,

2017, the new LLC filing documents were stamped for ZS Investments, LLC. Mohamad, however, stated that he would not sign any new LLC documents because Plaintiff was not his partner, and locked Plaintiff out of the business. (FAC, ¶¶ 12-22.)

The FAC asserts causes of action for: (1) breach of oral contract, (2) fraudulent misrepresentation, and (3) fraudulent concealment.

Defendants demur to each on the grounds of uncertainty and failure to state sufficient facts.

Breach of Oral Contract

With respect to the breach of oral contract cause of action, Plaintiff alleges that in early 2015 he entered into an oral contract with “Defendants” to open a grocery store as business partners-East Market and Restaurant. Under the terms of the agreement. Plaintiff, among other things, promised to provide half- of-the initial start-up capital as well as carry the 50% burden of day-to-day operation. (FAC, ¶ 25.) Under the terms of the agreement, “Defendants”, among other things, promised to provide half-of-the initial start-up capital as well as carry the 50% burden of day-to-day operation. (FAC, ¶ 26.)

The demurrer for uncertainty is SUSTAINED with leave to amend. Here, there are three named defendants. Plaintiff alleges that he entered into an oral contract with all three, however, the FAC only alleges discussions with Mohamad. To the extent Plaintiff asserts alter ego liability, his conclusory allegation that the LLC, Shakhofa and Mohamad are “alter egos” is insufficient, failing to plead any facts to support alter ego liability.

Having sustained the demurrer on this ground, the Court need not address Defendants’ remaining arguments.

Fraudulent Misrepresentation and Fraudulent Concealment

The demurrer for uncertainty is SUSTAINED with leave to amend Plaintiff alleges that “Defendants” made certain misrepresentations or concealed certain material facts. The FAC, however, only alleges discussions/interactions with Mohamad. To the extent Plaintiff asserts alter ego liability, his conclusory allegation that the LLC, Shakhofa and Mohamad are “alter egos” is insufficient, failing to plead any facts to support alter ego liability

Having sustained the demurrer on this ground, the Court need not address Defendants’ remaining arguments.

Plaintiff may file and serve a first amended complaint (“FAC”) by no later than March 23, 2018, Response to be filed and served within 30 days thereafter, 35 days if the

FAC is served by mail. (Although not required by any statute or rule of court, Plaintiff is requested to attach a copy of the instant minute order to the FAC to facilitate the filing of the pleading.)