Case Name:   Melnyk v. Kralian, et al.

Case No.:       1-14-CV-263018

After full consideration of the arguments and the authorities submitted by each party, the court makes the following rulings:

This is a breach of contract action.  In the complaint, plaintiff Paul Melnyk (“Plaintiff”) alleges that he is a real estate broker who represented defendants Elizabeth Kralian, Maureen McMahon, Fadi Semaan a.k.a. Frank Kralian (“Semaan”), and Elie Semaan a.k.a. Elie Kralian (“Elie”) (collectively, “Defendants”) in a negotiation with a lessee regarding the lease of real property in Morgan Hill (“the Property”).  (Compl., ¶¶ 11-16.)  The lease agreement (“the Lease”) allegedly provides that Plaintiff was to be paid a commission in two installments.  (Id., ¶ 17.)  Over Plaintiff’s objections, Defendants allegedly amended the Lease to lower his commission, and ultimately failed to pay his commission.  (Id., ¶¶ 18-19.)  Plaintiff filed the complaint on March 28, 2014, asserting causes of action for breach of contract and breach of the covenant good faith and fair dealing.

Defendants demur to both causes of action on the grounds of uncertainty, failure to allege sufficient facts, and failure to allege whether a contract is written, oral, or implied by conduct; and move to strike portions of the complaint.  (See Code Civ. Proc., §§ 430.10, subds. (e)-(g) & 435-436.)

Defendants’ requests for judicial notice in support of the demurrer and motion to strike are DENIED.  The contents of the Lease are reasonably disputable facts not capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy. (See Evid. Code, §§ 450 [“[j]udicial notice may not be taken of any matter unless authorized or required by law”] & 452, subd. (h).)

Defendants’ demurrer on the ground of uncertainty is OVERRULED.  (See Khoury v. Maly’s of California, Inc. (1993) 14 Cal.App.4th 612, 616 [“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”].)

Defendants’ demurrer on the ground of failure to allege sufficient facts is OVERRULED.  To state a claim for breach of contract or breach of the covenant of good faith and fair dealing, a plaintiff must allege the existence of a contract.  (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371; Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 349, 350.)  Plaintiff sufficiently alleges the existence of the Lease by pleading its general legal effect and by pleading that he is the intended third party beneficiary of that contract.  (See Khoury v. Maly’s of Cal., Inc. (1993) 14 Cal.App.4th 612, 616 [alleging legal effect of an oral contract]; see also Constr. Protective Services, Inc. v. TIG Specialty Ins. Co. (2002) 29 Cal.4th 189, 198-99 [alleging legal effect of a written contract]; see also Civ. Code, § 1559 [“[a] contract, made expressly for the benefit of a third person, may be enforced by him”]; see also Vahle v. Barwick (2001) 93 Cal.App.4th 1323, 1328 [an intended beneficiary has standing].)  Since Plaintiff does not allege that the Lease is an oral contract, Defendants’ argument that a broker cannot enforce an oral promise for compensation is unavailing.  (See Hall v. Great Western Bank (1991) 231 Cal.App.3d 713, 719, fn.7 [“[a] court will not consider facts which have not been alleged in the complaint unless they may be reasonably inferred from the matters which have been pled or are proper subjects of judicial notice”].)  Similarly, Defendants contend that Plaintiff has not sufficiently alleged the existence of a contract because the alleged terms of the Agreement contradict the terms Defendants proffer in their request for judicial notice, and that Elie and Semaan are not parties to the Lease because they do not own the Property.  These arguments rely on a request for judicial notice that has been denied, and are based on facts contrary to those alleged in the complaint.  Therefore, Defendants’ arguments are not well-taken.  (See id.)

Defendants’ demurrer on the ground of failure to allege whether the contract is written, oral, or implied by conduct is SUSTAINED WITH 10 DAYS’ LEAVE TO AMEND.  The complaint does not specify whether the lease was written, oral, or implied by conduct.

In light of the foregoing, the motion to strike portions of the complaint is MOOT.

The Court will prepare the order.