Case Name: Sergiu Deac v. Sahajananda Talla, et al.
Case No.: 1-14-CV-268791

This action arises from a dispute over a construction contract. Defendants and cross-complainants Sahajananda Talla and Sandhya Sri Thota (“Cross-Complainants”) retained plaintiff and cross-defendant Sergiu Deac (“Deac”) to remodel their home, and allege that Deac made a number of misrepresentations and violated the law and the parties’ contract in performing the work at issue. Deac filed this action to recover sums allegedly owed by the Cross-Complainants on the contract, and Cross-Complainants counterclaimed on August 19, 2014. The Court (Hon. Carol Overton) sustained Deac’s demurrer to the original cross-complaint with leave to amend; Cross-Complainants did not oppose that motion in substance, but had attempted to file an amended pleading that was rejected by the clerk. (See December 9th, 2014 order.)

On December 12, 2014, Cross-Complainants filed the operative first amended cross-complaint (the “FAXC”) against Deac. On December 29, 2014, Deac demurred to the second cause of action for constructive fraud and the fourth cause of action for intentional infliction of emotional distress.

I. Request for Judicial Notice

Cross-Complainants’ request for judicial notice of declarations previously filed in this action is GRANTED. (Evid. Code, § 452, subd. (d).) To the extent that the request is granted, however, the Court takes judicial notice of the existence and content of these documents only, and not of the truth of statements contained therein. (See Sosinsky v. Grant (1992) 6 Cal.App.4th 1548, 1564-1568 [a court may take judicial notice of the existence and content of each document in a court file, but cannot take judicial notice of the truth of statements or factual findings therein].)

II. Demurrer to the Second Cause of Action for Constructive Fraud

Constructive fraud consists of “1. … any breach of duty which, without an actually fraudulent intent, gains an advantage to the person in fault, or anyone claiming under him, by misleading another to his prejudice, …; or, 2. … any such act or omission as the law specially declares to be fraudulent, without respect to actual fraud.” (Civ. Code, § 1573.) To state a claim for the first type of constructive fraud, a plaintiff must allege a fiduciary or confidential relationship between the parties giving rise to a duty on the part of the defendant. (See Salahutdin v. Valley of California, Inc. (1994) 24 Cal.App.4th 555, 562 [“Constructive fraud is a unique species of fraud applicable only to a fiduciary or confidential relationship.”], quoting 2 Miller & Starr, Cal. Real Estate (2d ed. 1989) § 3:20, p. 119; Stokes v. Henson (1990) 217 Cal.App.3d 187, 197 [“The elements for the cause of action for constructive fraud are: (1) fiduciary relationship; (2) nondisclosure (breach of fiduciary duty); (3) intent to deceive, and (4) reliance and resulting injury (causation).”], quoting Younan v. Equifax Inc. (1980) 111 Cal.App.3d 498, 516, fn. 14.)

Here, Cross-Complainants fail to allege facts giving rise to a confidential or fiduciary relationship. (See McCauley v. Dennis (1963) 220 Cal.App.2d 627, 635-636 (hereinafter, “McCauley”) [no fiduciary relationship arose between contractor and landowner based upon contractor’s representation relied upon by landowner, contractor’s license as a general contractor, or the parties’ contract]; Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 649, 657 [citing McCauley for the proposition that no fiduciary or confidential relationship exists between a building contractor and his clients, even where plaintiff homeowners had no experience in construction].)

Cross-Complainants contend that a confidential relationship arose in this case because they “spoke very little English and had never contracted with a general contractor before.” (Opp., p. 8.) However, the FAXC contains no such allegations, and, as the Court held above, such facts are not proper subjects of judicial notice.

In light of the above, the demurrer to the second cause of action is SUSTAINED WITH 10 DAYS’ LEAVE TO AMEND.

III. Demurrer to the Fourth Cause of Action for Intentional Infliction of Emotional Distress

On January 22, 2015, Cross- Complainants filed a request for dismissal of the fourth cause of action. Consequently, the demurrer is MOOT as to this claim.