Defendant Melody Buchholz’s initial request for judicial notice of four documents (Exhibits A-D) in support of her Demurrer to the SAC is GRANTED pursuant to Evid. Code §452(d). Exhibits A and B are also offered in support of Melody Buchholz’s Motion to Strike. Exhibits A and B establish that Plaintiffs Yolanda Tidwell and Arletta Anderson have been co-Trustees of the Jimmie and Joyce Bunnell Family Living Trust since August 2008 and that Jimmie Bunnell was not removed as a co-Trustee because of incapacity until March 15, 2010. Exhibits C and D, copies of the March 4, 2013 original Complaint and the July 1, 2013 FAC respectively, are noticed both as to their existence and filing dates and as to their contents (but not the truth of their contents) given Defendants’ sham pleading argument. “The policy against sham pleadings permits the court to take judicial notice of the prior pleadings and requires that the pleader explain the inconsistency. If he fails to do so the court may disregard the inconsistent allegations.” Owens v. Kings Supermarket (1988) 198 Cal App 3d 379, 384.

Defendant Melody Buchholz’s supplemental request for judicial notice of an Oct. 24, 2013 Order of the Court (Hon. Cain) in the related probate matter, case no. 1-10-PR-166743, ordering payment of $83,751.75 for legal services and $6,345.39 for costs to Richard A. Gorini Esq. from the Trust (Ex. E) is GRANTED pursuant to Evid. Code §452(d). The Court also on its own motion takes judicial notice pursuant to Evid. Code §452(d) of 1) the Feb. 18, 2014 Order of the Court in the probate matter denying the motion to reconsider and reaffirming its Order approving compensation, and; 2) The prior Dec. 2, 2013 Order of the Court (Hon. McKenney) in this matter on the demurrers to and motions to strike portions of the First Amended Complaint (“FAC”).

On demurrer all properly pled material facts are accepted as true, but not contentions or conclusions of law. Allegations are not accepted as true on demurrer if they contradict or are inconsistent with facts judicially noticed. Similarly, 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 Holland v. Morse Diesel Int’l, Inc. (2001) 86 Cal App 4th 1443, 1447. “While inconsistent theories of recovery are permitted, a pleader cannot blow hot and cold as to the facts positively stated.” Manti v. Gunari (1970) 5 Cal.App.3d 442, 449, internal citation omitted. See also Witkin, California Evidence (4th Ed., 2000) 1 Judicial Notice §3(3) (“It has long been established in California that allegations in a pleading contrary to judicially noticed facts will be ineffectual; i.e., judicial notice operates against the pleader.”)

The separate demurrers by Melody Buchholz and by William Buchholz and the Family Community Church (“FCC”) to the SAC’s 1st cause of action for Breach of Fiduciary Duty, on the ground that it fails to state sufficient facts, are both SUSTAINED. As the prior Dec. 2, 2013 Order of the Court (Hon. McKenney) explained in sustaining the demurrer to this claim as alleged in the FAC while “reluctantly” granting leave to amend for the second time:

“The existence of a fiduciary duty of care, as with duties of care generally, is a question of law for the Court. ‘In order to plead a cause of action for breach of fiduciary duty, there must be shown the existence of a fiduciary relationship, its breach, and damage proximately caused by that breach. The absence of any one of these elements is fatal to the cause of action.’ Brown v. California Pension Administrators & Consultants, Inc. (1996) 45 Cal.App.4th 333, 347-348; see also CACI, No. 605. ‘While breach of fiduciary duty is a question of fact, the existence of legal duty in the first instance and its scope are questions of law.’ Kirschner Brothers Oil, Inc. v. Natomas Co. (1986) 185 Cal.App.3d 784, 790.”

“Contrary to Plaintiffs’ arguments, under modern authority confidential relationships and fiduciary relationships are not synonymous and the allegation of a close confidential relationship does not in itself establish the existence of a fiduciary duty. This was clearly explained in the Court’s prior Order. ‘[B]ecause of ‘[t]he vagueness of the common law definition of the confidential relation that gives rise to a fiduciary duty, and the range of the relationships that can potentially be characterized as fiduciary,’ the ‘essential elements’ have been distilled as follows: ‘1) The vulnerability of one party to the other which 2) results in the empowerment of the stronger party by the weaker which 3) empowerment has been solicited or accepted by the stronger party and 4) prevents the weaker party from effectively protecting itself.’’ Persson v. Smart Inventions, Inc. (2005) 125 Cal. App. 4th 1141, 1160-1161, internal quotations and citations omitted, emphasis added. See also City of Hope Nat. Med. Center v. Genentech, Inc. (2008) 43 Cal 4th 375, 386, quoting Committee on Children’s Television, Inc. v. General Foods Corp. (1983) 35 Cal 3d. 197, 221 (“’[B]efore a person can be charged with a fiduciary obligation, he must either knowingly undertake to act on behalf and for the benefit of another, or must enter into a relationship which imposes that undertaking as a matter of law.’”)”

See Dec. 2, 2013 Order at 2:16-3:15.

The 1st cause of action as alleged in the SAC continues to fail to state sufficient facts as it fails to establish that either Melody or William Buchholz or FCC ever expressly agreed to act as a fiduciary to the Bunnells or entered into a relationship imposing such a duty as a matter of law during the relevant time period.

The basic family relation between an adult child and her parents and/or between a son-in-law and his in-laws does not in itself give rise to a fiduciary relationship regardless of the presence of trust in the relationship. Attendance at a particular church led by a particular pastor or other clergy does not in itself give rise to a fiduciary relationship regardless of the presence of trust in the relationship. See Richelle L. v. Roman Catholic Archbishop (2003) 106 Cal App 4th 257, 271 (“Unlike confidential relations, fiduciary relations arise out of certain canonical relationships that are legally defined and regulated.”) A contractual relationship does not in itself give rise to a fiduciary relationship. See Wolf v. Superior Court (2003) 107 Cal.App.4th 25, 30-31, 33-34. It therefore follows that an adult child and his/her parent’s decision to enter into a contract and/or a parishioner and church’s decision to enter into a business contract also does not give rise to a fiduciary duty absent express language in such a contract stating that such a duty is undertaken by one of the parties. “It is not at all unusual for a party to enter into a contract for the very purpose of obtaining the superior knowledge or expertise of the other party. Standing alone, that circumstance would not necessarily create fiduciary obligations, which generally come into play when one party’s vulnerability is so substantial as to give rise to equitable concerns underlying the protection afforded by the law governing fiduciaries. . . . And one party’s ‘ability to exploit a disparity of bargaining power’ between the parties does not necessarily create a fiduciary relationship.” City of Hope National Medical Center v. Genentech, Inc. (2008) 43 Cal 4th 375, 389, internal citations omitted.

Plaintiffs “cannot blow hot and cold as to the facts positively stated.” Manti, supra. Judicially noticed material establishes that Jimmie Bunnell was not found to be incapacitated until March 15, 2010. The SAC at 9-10 alleges that from March 19, 2001 until at least 2008 Jimmie Bunnell exercised primary responsibility for trust administration and managed his and his wife’s finances. The events this claim is based on took place in 2003 (the purchase of the Sacramento apartment building) on June 20, 1997, August 22, 1997 and June 20, 2006 (the three promissory notes evidencing loans to FCC) and the alleged wrongful transfer of the Sacramento building in 2009. Accordingly any allegations that Mr. Bunnell was so substantially vulnerable during this period as to give rise to equitable concerns that could create a fiduciary duty must be disregarded. Further leave to amend the 1st cause of action is DENIED. Plaintiffs have had more than adequate opportunity to properly state this claim.

The separate demurrers by Melody Buchholz and by William Buchholz and the FCC to the SAC’s 2nd cause of action for Fraud, 3rd cause of action for Conversion and 4th cause of action for Financial Elder Abuse on statute of limitations grounds are both SUSTAINED. The question is whether the SAC now states sufficient facts to alter the Court’s prior determination that these causes of action are each barred by the applicable statute of limitations (three years under CCP §338(d), three years under CCP §338(c) and four years under Welfare & Institutions Code §15657.7) and that delayed discovery had not been sufficiently alleged. All three claims are based on the promissory notes entered into in 1997 and 2006, the purchase of the apartment building in 2003 and its related transfer in 2009. In their Oppositions to both demurrers Plaintiffs offer various arguments as to why the claims should not be found barred, only some of which are supported by allegations in the SAC and may be considered on demurrer. “When a plaintiff relies on a theory of fraudulent concealment, delayed accrual, equitable tolling, or estoppel to save a cause of action that otherwise appears on its face to be time-barred, he or she must specifically plead facts which, if proved, would support the theory.” Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 641, emphasis added.

Plaintiffs’ argument for statutory tolling under CCP §352(a) is not pled in the SAC and has no application here as not only has the Trust always had Trustees with capacity representing it but also judicially noticed material establishes that Jimmie Bunnell was not found to lack capacity until March 15, 2010, well after the events allegedly giving rise to these claims. See CCP §357 (“No person can avail himself of a disability, unless it existed when his right of action accrued.”) There are also no allegations in the SAC supporting a continuing violation or continuous accrual argument and these doctrines have no clear application here. To the extent the promissory notes entered into in 1997 (the first two notes) and 2006 (the third or “bridge loan”) and the purchase of the apartment building in 2003 were harmful or unfair to Jimmie Bunnell and/or the Bunnell Trust, that harm had occurred when the transactions were completed. The same is true for the alleged fraudulent transfer of the apartment building and wrongful use of funds to pay property taxes in 2009, which is part of the earlier 2003 wrong. These are discrete, independent (alleged) wrongs that were complete at the time they were (allegedly) performed. These allegations do not show a wrongful course of conduct that became apparent only through the accumulation of small harms to which the continuing violation doctrine could apply (particularly given Plaintiffs’ newly added allegations as to their knowledge from 1997 forward); nor do they show a violation of a continuing or recurring obligation that could support application of the continuous accrual doctrine. See Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal 4th 1185, 1197-1199.

As for the SAC’s allegation of delayed discovery, “[i]n order to rely on the discovery rule for delayed accrual of a cause of action, ‘[a] plaintiff whose complaint shows on its face that his claim would be barred without the benefit of the discovery rule must specifically plead facts to show (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence.’ In assessing the sufficiency of the allegations of delayed discovery, the court places the burden on the plaintiff to ‘show diligence’; ‘conclusory allegations will not withstand demurrer.’” Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 808, internal citations omitted, emphasis added. To be entitled to the benefit of the delayed discovery rule a plaintiff must specifically plead the time and manner of discovery and show the following: 1) Plaintiff had an excuse for late discovery; 2) Plaintiff was not at fault in discovering facts late; 3) Plaintiff did not have actual or presumptive knowledge to be put on inquiry; 4) Plaintiff was unable to make earlier discovery despite reasonable diligence. E-Fab, Inc. v. Accountants, Inc. Services (2007) 153 Cal App 4th 1308, 1319, 1324-1325.

“Under the discovery rule, the statute of limitations begins to run when the plaintiff suspects or should suspect that her injury was caused by wrongdoing, that someone has done something wrong to her. The limitations period begins once the plaintiff has notice or information of circumstances to put a reasonable person on inquiry. A plaintiff need not be aware of the specific ‘facts’ necessary to establish the claim; that is a process contemplated by pretrial discovery. Once the plaintiff has a suspicion of wrongdoing, and therefore an incentive to sue, she must decide whether to file suit or sit on her rights. So long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her.” Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 642-643, emphasis added.

“A plaintiff has reason to discover a cause of action when he or she ‘has reason at least to suspect a factual basis for its elements.’ Under the discovery rule, suspicion of one or more of the elements of a cause of action, coupled with knowledge of any remaining elements, will generally trigger the statute of limitations period. Norgart explained that by discussing the discovery rule in terms of a plaintiff’s suspicion of ‘elements’ of a cause of action, it was referring to the ‘generic’ elements of wrongdoing, causation, and harm. In so using the term ‘elements,’ we do not take a hypertechnical approach to the application of the discovery rule. Rather than examining whether the plaintiffs suspect facts supporting each specific legal element of a particular cause of action, we look to whether the plaintiffs have reason to at least suspect that a type of wrongdoing has injured them.” Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 807, internal citations omitted.

The SAC does not sufficiently allege delayed discovery. Plaintiffs’ original complaint was filed on March 4, 2013. Plaintiffs became Co-Trustees in August 2008 and Jimmie Bunnell remained a Trustee until March 2010, yet Plaintiffs still have not explained their inability—despite the presumed exercise of reasonable diligence both generally and in their roles as Trustees—to discover wrongdoing allegedly based on transactions involving the Trust and/or false or misleading representations made to Jimmie Bunnell that took place in 1997, 2003, 2006 and 2009 any earlier than March 23, 2010. SAC at 17. Furthermore, the newly added allegations in the SAC at 53-54 claiming for the first time that Plaintiffs were not only part of conversations regarding these Trust transactions but “expressed concern” to Defendants Melody and William regarding the security of the investments beginning in 1997 and received assurances in 1997, 2006 and 2010 flatly contradict the allegation in the SAC at 17 of “first suspicion” in March 2010, contradict any argument of fraudulent concealment by Defendants and establishes that Plaintiffs had suspicion and knowledge sufficient to put them on inquiry notice from 1997 forward and had a responsibility to exercise reasonable diligence to investigate their suspicions long before March 2010.

Finally Plaintiffs argue that the SAC alleges facts that can support equitable tolling. Equitable Tolling “may suspend or extend the statute of limitations when a plaintiff has reasonably and in good faith chosen to pursue one among several remedies and the statute of limitations notice function has been served.” Aryeh, supra at 1192. Even if it is assumed that this doctrine could have preserved civil claims regarding Trust transactions not already time barred when the related probate action began in March 2010 it could not revive any claims whose limitations periods had already expired.

Leave to amend the SAC’s 2nd, 3rd and 4th causes of action is DENIED as it is apparent, particularly given the newly added allegations, that Plaintiffs cannot amend to allege that these claims are not barred by the applicable statutes of limitation without contradicting present fact pleading.

The separate Motions to Strike portions of the SAC by Melody Buchholz and by William Buchholz and FCC are MOOT in light of the rulings on the demurrers.