Theodore Stewart-Yogman et al vs Juergen U Boehr et al

Case Number

23CV03697

Case Type

Hearing Date / Time

Mon, 01/22/2024 - 10:00

Nature of Proceedings

Motion: Strike

Tentative Ruling

Theodore Stewart-Yogman, et al. v. Sierra Property Group, Inc., et al.

Case No. 23CV03697

           

Hearing Date: January 22, 2024                                                        

MATTER:                Defendant’s Motion To Strike Punitive Damages Allegations

                                   

ATTORNEYS:        For Plaintiffs Natalie Stewart and Theodore Stewart-Yogman, a minor by and through his guardian ad litem Natalie Stewart: Morgan E. Pietz, Cyrus E. Shahriari, Pietz & Shahriari, LLP

                             For Defendant Sierra Property Group, Inc.: Ty S. Vanderford, Todd A. Picker, Guy Chezrony, Vanderford & Ruiz, LLP

                                    For Defendant Juergen U. Boehr: Gerald B. Velasco, Law Offices of Scott C Stratman

TENTATIVE RULING:

The motion of defendant Sierra Property Group, Inc., to strike plaintiffs’ demand for punitive damages is granted with leave to amend in accordance with this ruling. The following matters shall be stricken from plaintiffs’ complaint: prayer for relief paragraph 4. Any amended pleading must be filed and served by plaintiffs on or before February 1, 2024.

Background:

Plaintiffs Natalie Stewart (Natalie) and Theodore Stewart-Yogman (Theodore), a minor by and through his guardian ad litem Natalie (collectively, plaintiffs), filed their complaint against defendants Sierra Property Group, Inc. dba Sierra Property Management (Sierra) and Juergen U. Boehr (Boehr) (collectively, defendants) on August 23, 2023. (Note: To avoid confusion due to common surnames, the court will refer to plaintiffs by their first names. No disrespect is intended.) As alleged in plaintiffs’ complaint:

Plaintiffs are former tenants of a single-family home located at 121 Olive Mill Road #B, in Santa Barbara, California (the property). Boehr, the owner of the property, hired Sierra to manage the property. Plaintiffs agreed to lease the property from defendants as a primary residence and moved in on June 1, 2019, Plaintiffs rented the property for three and one-half years until January 1, 2023, when plaintiffs were forced to vacate the property due to allegedly unfit and substandard conditions that were not sufficiently addressed by defendants.

When plaintiffs moved into the property, they discovered gas leaks, a black film of dust all over the floors, dead insects, black substances on the window sills and screens that appeared to be black mold, dirty sinks and bathtubs, flooring in disrepair, and an overpowering musty odor. A few months after plaintiffs moved into the property, the dryer overheated and incinerated a load of Natalie’s laundry. The washer and dryer appeared to be very old. The dryer was irreparably damaged because of the fire and replaced by Sierra but Sierra did not reimburse Natalie for her destroyed clothing.

The property also had chronic plumbing issues which caused significant water damage. At times, Sierra did not respond to Natalie’s reports regarding the plumbing issues and at other times, Sierra attempted failed superficial repairs for which Sierra improperly charged Natalie.

In October 2019, the bathtub at the property clogged. After Sierra failed to respond, Natalie hired a plumber who snaked a video line into the pipes. The plumber discovered that the pipes were corroded and significantly damaged as a result of roots growing inside of the pipes. The plumber advised Natalie that the tap water was unsafe to drink and that the pipes needed to be replaced. Defendants declined to make the recommended repairs and instead criticized the competence of the plumber hired by Natalie.

In early 2020, the property lacked sufficient heating after the bathroom and living room heaters broke down.

In June 2020, Natalie found a black substance growing on the walls of the shower and a brown substance on the ceiling in the bathroom. Sierra sent its property manager to personally inspect the bathroom. The property manager stated that the substance was not mold and was not hazardous or a health risk, but was the result of a household cleaning issue.

In 2021, a sewage leak in the back garden at the property resulted in a severe odor. Sierra sent out a plumber who did not replace any pipes at the property. The smell would periodically return. There was also a black widow infestation at the property in 2021 and 2022.

In October 2022, there were leaks in the bathroom around the toilet and bathtub. A representative of Sierra who investigated these leaks commented that the bathroom needed renovation and that plumbing issues were common at the property. Sierra’s representative also stated that Boehr was conservative about repair expenditures and that it was challenging to get Boehr to approve maintenance requests. Sierra’s attempts at repairing the toilet did not address the problem and the toilet continued to leak.

On October 28, 2022, Natalie notified Sierra’s representative that more water than usual was leaking and pooling around the base of the toilet. When a plumber attempted to install a new toilet, he advised Natalie that the old toilet did not have a wax ring. As a result, sewage had been leaking under the laminate floor resulting in water damage to the subfloor and contamination throughout the bathroom. The leakage created an unsafe environment for mold and toxins to grow. Despite these conditions, Sierra’s representative told Natalie that the property was safe and habitable.

Between October 28 and 31, 2022, Natalie paid for a hotel room for plaintiffs because the property was unfit for human occupation due to defendants’ refusal to sufficiently address the problems with the bathroom floor and toilet. On November 1, 2022, Sierra advised Natalie that they had hired a remediation service to address the issues in the bathroom.

Plaintiffs hired a mold inspector on November 2, 2022. The inspection indicated elevated and abnormal levels of aspergillus/penicillium, Chaetomium and Basidiospores.

On November 3, 2022, Natalie discovered that defendants had changed the locks to the property without notice. Sierra refused to provide Natalie with the code to the lockbox at the property despite Natalie continuing to pay rent for the property.

In November 2022, Sierra advised Natalie that the remediation was complete and the home safe and habitable. When Natalie returned to the property on December 17, 2022, she discovered that the mold and other conditions had not been remediated or resolved. Natalie had to discard personal belongings that were covered in mold and irreparably damaged. Sierra claimed that Natalie’s personal belongings were merely covered in dust due to inadequate housekeeping.

Plaintiffs believe that heavy flooding and mudslides in Santa Barbara County in 2018 exacerbated the conditions at the property. Defendants failed to inspect or make repairs at the property after the flooding and mudslides to ensure that the property was safe for habitation.

The complaint alleges six causes of action: (1) negligence (against defendants); (2) breach of the implied warranty of habitability; (3) failure to return security deposit (Civil Code section 1950.5); (4) breach of the implied covenant of quiet enjoyment (Civil Code section 1927); (5) illegal prevention of access to tenant’s property (Civil Code section 789.3); and (6) unfair business practices (Business and Professions Code section 17200 et seq.).

On October 30, 2023, Sierra filed a motion to strike the demand for punitive damages in plaintiffs’ complaint. Plaintiffs oppose the motion of Sierra.

On October 31, 2023, Sierra filed an answer to plaintiffs’ complaint, generally denying its allegations and asserting twenty-nine affirmative defenses.

Boehr filed an answer to plaintiffs’ complaint on December 4, 2023.

Analysis:

“Any party, within the time allowed to respond to a pleading may serve and file a notice of motion to strike the whole or any part thereof[.]” (Code Civ. Proc., § 435, subd. (b)(1).) In ruling on a motion to strike, a court may “strike out any irrelevant, false, or improper matter inserted in any pleading” or “strike  all or part of any pleading not filed in conformity with applicable law, court rules, or an order of the court” (Code Civ. Proc., §436.) The grounds for a motion to strike must appear on the face of the pleading or from matters which the court may take judicial notice. (Code Civ. Proc., § 437, subd. (a).)

Defendants move to strike the entirety of plaintiffs demand for “punitive and exemplary damages in an amount appropriate to punish and make an example of defendants” appearing at page 17, lines 10 through 11, of plaintiffs’ complaint. To survive a motion to strike allegations of punitive damages, ultimate facts showing an entitlement to such relief must be pleaded. (Clauson v. Superior Court (1998) 67 Cal.App.4th 1253, 1255.) In addition, the facts and circumstances constituting the claim for punitive damages must be set forth “with sufficient particularity to apprise the opposite party of what he is called on to answer, and to enable the court to determine whether, on the facts pleaded, there is any foundation [for the claim].” (Lehto v. Underground Construction Company (1977) 69 Cal.App.3d 933, 944.)

Under Civil Code section 3294, subdivision (a), punitive damages are recoverable where it is shown by clear and convincing evidence that the defendant acted with malice, oppression, or fraud. “Malice” means “conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others.” (Civ. Code, § 3294, subd. (c)(1).) “Oppression” means “despicable conduct that subjects a person to cruel and unjust hardship in conscious disregard of that person’s rights.” (Civ. Code, § 3294, subd. (c)(2).) While the term “despicable” is not defined in Civil Code section 3294, subdivision (c), the term includes “circumstances that are ‘base,’ ‘vile,’ or ‘contemptible.’ [Citation.]” (College Hospital Inc. v. Superior Court (1994) 8 Cal.4th 704, 725.) “Fraud” means an intentional misrepresentation, deceit, or concealment of a material fact known to the defendant with the intention on the part of the defendant of thereby depriving a person of property, legal rights, or otherwise causing injury. (Civ. Code, § 3294, subd. (c)(3).)

In their complaint, plaintiffs do not allege a statutory basis for an award of punitive damages. (See Civ. Code, § 1950.5, subd. (l) [describing statutory damages of up to twice the amount of security in addition to actual damages recoverable upon a landlord’s bad faith retention of security]; Civ. Code, § 3304 [prescribing the measure of damages for a breach of the covenant of quiet enjoyment under Civil Code section 1927]; Civ. Code, § 789.3, subd. (c) [setting forth damages available against a landlord who willfully prevents a tenant from gaining “reasonable” access to the property by changing the locks].)

In addition, though plaintiffs allege that Sierra indicated that the property would be clean, sanitary and habitable and that Sierra delivered the property with unsanitary and substandard conditions, there are no allegations establishing that Sierra knew its purported representations were false or that Sierra intended to defraud plaintiffs. (See Lazar v. Superior Court (1996) 12 Cal.4th 631, 638 [“[t]he elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or ‘scienter’); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage”].) The same analysis applies with respect to plaintiffs’ allegations that Sierra told plaintiffs that black substances were mildew or dust and not mold, and that the property had been sufficiently remediated. For these reasons, giving the complaint a reasonable interpretation, plaintiffs do not sufficiently allege, either expressly or by inference, that Sierra engaged in conduct constituting fraud.

Furthermore, to the extent plaintiffs allege a claim for punitive damages based on Sierra changing the locks to the property are conclusory and do not by themselves support a claim for punitive damages. For example, it can be inferred from facts expressly alleged in the complaint that Sierra changed the locks in connection with Sierra’s efforts to complete repairs to and remediation of the property, and not for an improper purpose. (See Compl., ¶ 43 [alleging that a mold remediation company hired by Sierra to perform the remediation sprayed a “vinegar fog” inside the property and that plaintiff was able to return to the property after Sierra completed the remediation].) As further discussed above, punitive damages are not expressly authorized under Civil Code section 789.3, subdivision (c), based on a landlord willfully preventing a tenant from accessing a property by changing the locks at the property.

The remaining allegations of the complaint state nothing more than a claim for ordinary negligence resting on, at most, arguably reckless or careless conduct by Sierra in allegedly failing to sufficiently investigate or remediate the conditions of the property alleged in the complaint. (Lackner v. North (2006) 135 Cal.App.4th 1188, 1210-1211 [defendant’s carelessness, recklessness, or ignorance is insufficient to justify imposition of punitive damages].) Plaintiffs have not alleged conduct sufficient to constitute fraud, malice, or oppression.

The cases cited by plaintiffs do not change the court’s analysis. For example, in Stoiber v. Honeychuck, the court held that a tenant’s remedies for a failure by a landlord to maintain premises are not limited to an action for breach of the warranty of habitability, but also include a right to sue in tort for damages. (Stoiber v. Honeychuck (1980) 101 Cal.App.3d 903, 931-932.) The court did not, however, determine whether the allegations of the complaint at issue in that case pleaded facts sufficient to demonstrate an entitlement to punitive damages. (Ibid.)

In addition, the conduct by Sierra as alleged in the complaint is not analogous to the type of conduct alleged by the plaintiff in Tooke v. Allen (1948) 85 Cal.App.2d 230. For example, plaintiffs do not plead that Sierra made threats against plaintiffs, assaulted plaintiffs, forcibly entered the property, stole plaintiffs’ personal belongings, or shut off gas or electricity at the property for an improper purpose during plaintiffs’ tenancy. (See Tooke v. Allen (1948) 85 Cal.App.2d 230, 233.)

In Aweeka v. Bonds, the court found that plaintiffs had sufficiently alleged causes of action for retaliatory eviction and intentional infliction of emotional distress such that plaintiffs could seek punitive damages. (Aweeka v Bonds (1971) 20 Cal.App.3d 278, 281.) The court did not, however, consider or make any findings as to whether the allegations of the complaint at issue in that case were sufficient to allege an entitlement to punitive damages.  

For all reasons discussed above, the complaint fails to allege facts sufficient to support a claim for punitive damages against Sierra. Therefore, the court will grant Sierra’s motion to strike, with leave to amend. Leave to amend will be limited to providing further allegations relating to a claim for punitive damages. In the event that plaintiffs seek to add any other cause of action, plaintiffs will need to obtain leave of court either by stipulation or by noticed motion.