2013-00145133-CL-CL

Northern California Collection vs. Donald Eugene Kruse

Nature of Proceeding:     Hearing on Demurrer

Filed By:   Cribb, Steven D. The Demurrer of Northern California Collection Service (“NCCS”) to the Cross-
complaint of Donald Kruse d.b.a. Priority Electric is SUSTAINED, with and without
leave to amend.

The notice of motion does not provide notice of the Court’s tentative ruling system as
required by with C.R.C., Rule 3.1308 and Local Rule 1.06(D).  Local Rules for the
Sacramento Superior Court are available on the Court’s website at
<http://www.saccourt.ca.gov/local-rules/local-rules.aspx> Counsel for moving party is
ordered to notify opposing party immediately of the tentative ruling system and to be
available at the hearing, in person or by telephone, in the event opposing party
appears without following the procedures set forth in Local Rule 1.06(B).

The underlying complaint filed by NCCS against Donald Kruse d.b.a. Priority Electric is
a collection action, brought by NCCS as the assignee of Surewest Directories for open
book account, for the principal amount of $10,160.26  which Kruse allegedly failed to
pay Surewest.

The Cross-complaint by Kruse against Surewest and NCCS alleges two causes of
st                                       nd
action: the 1   for breach of contract and the 2           for unfair business / trade practices.
NCCS demurs to both.

st
Demurrer to the 1   for breach of contract is SUSTAINED, without leave to amend.

The elements of the cause of action for breach of contract are (1) the existence of the
contract, (2) performance by the plaintiff or excuse for nonperformance, (3) breach by
the defendant and (4) damages. First Commercial Mortgage Co. v. Reece (2001) 89
Cal. App. 4th 731, 745.

Kruse has failed to allege that NCCS was a signatory to the alleged contract, and no
copy of that contract has been attached.  A general agency allegation is insufficient to
allege privity of contract against NCCS.

The cross-complaint is fatally defective because it fails to show that NCCS was a party
to the contract. Gordon Bldg. Corp. v. Gibraltar Sav. & Loan Assoc. (1966) 247 Cal.
App. 2d 1, 6.

Demurrer to the 2nd for unfair business / trade practices is SUSTAINED, with leave to
amend.

The cross-complaint alleges violation of the Rosenthal Fair Debt Collection Practices
and the Fair Debt Collection Practices Act.  Both the Rosenthal Act and the Fair Debt
Collection Practices Act apply to consumer credit transactions obtained “primarily for
personal, family, or household purposes.” Civil Code § 1788.2(e); 15 USCS § 1692a
(5).

Here, where the debt is alleged to be for a business listing by Kruse d.b.a. Priority 1
Electric, for advertising in Surewest’s directory, no consumer debt has been alleged.

In opposition, cross-complaint Kruse asserts that he is alleging fraud in addition to
violation of the consumer protection acts.

However, although Kruse prays for restitution of the sum of $10,160, he fails to allege
that he has overpaid that sum, or any sum at all.  In the absence of an allegation of
overpayment, he is not entitled to restitution.

If Kruse can truthfully allege overpayment and fraud he shall have leave to amend the
second cause of action. The First Amended Cross complaint shall be due filed and
served not later than Friday, Jan. 3, 2014. The responsive pleadings shall be due filed
and served 10 days thereafter, 15 days if service is by mail.

The minute order is effective immediately.  No formal order pursuant to CRC Rule
3.1312 or further notice is required.