Tentative Ruling: Luis Ibarra v. 4647 Carp Ave LLC, et al.
Case Number
25CV01602
Case Type
Hearing Date / Time
Mon, 04/27/2026 - 10:00
Nature of Proceedings
Defendants’ Demurrer to Plaintiff’s First Amended Complaint
Tentative Ruling
Luis Ibarra v. 4647 Carp Ave LLC, et al.
Case No. 25CV01602
Hearing Date: April 27, 2026
HEARING: Defendants’ Demurrer to Plaintiff’s First Amended Complaint
ATTORNEYS: For Plaintiff Luis Ibarra: John J. Thyne III, Law Offices of John J. Thyne III
For Defendants 4647 Carp Ave LLC, Juan Rodriguez, and Sara Dandona: Travis C. Logue, Mandy D. Moua, Presidio Law Firm LLP
TENTATIVE RULING:
- The demurrer as to the first, second, third, fourth, fifth, sixth, seventh, eighth, and tenth causes of action is overruled.
- The demurer as to the ninth cause of action is provisionally overruled as follows:
- Plaintiff shall file and serve a verification of the first amended complaint as required by Code of Civil Procedure section 761.020 no later than May 11, 2026. If plaintiff files and serves the verification as directed, defendants shall file and serve their answers to the first amended complaint no later than May 26, 2026.
- Should plaintiff fail to file and serve a verification of the first amended complaint by May 11, 2026, the demurrer to the ninth cause of action is sustained with leave to amend. If the demurrer is sustained with leave to amend, plaintiff shall file and serve his second amended complaint no later than May 18, 2026, and defendants shall file and serve any responsive pleading no later than June 5, 2026.
- Counsel for defendants shall give notice of this ruling to plaintiff’s counsel no later than April 30, 2026, and file proof of service of the same no later than May 1, 2026.
Background:
On March 14, 2025, plaintiff Luis Ibarra (Ibarra) filed his original complaint against defendants 4647 Carp Ave LLC (the LLC), Juan Rodriguez (Rodriguez), and Sara Dandona (Dandona) (collectively “defendants”), for: (1) conversion; (2) fraud; (3) constructive fraud; (4) breach of fiduciary duty; (5) breach of contract; (6) unjust enrichment; (7) negligence; (8) equitable estoppel; (9) quiet title; and (10) accounting.
Following the partial sustaining of a motion to strike punitive damages, with leave to amend, on October 28, 2025, Ibarra filed the operative first amended complaint (FAC) asserting the same 10 causes of action.
As alleged in the FAC:
Ibarra purchased real property located at 4647 Carpinteria Avenue, Carpinteria (the Real Property) and worked with Rodriguez and Dandona, who are husband and wife, to help finance the purchase and ultimately to participate in ownership of the LLC. (FAC, ¶ 1.)
Ibarra created the LLC on December 20, 2023, with his wife, by entering an Operating Agreement, filing Articles of Organization with the Secretary of State, and obtaining a taxpayer identification number. (FAC, ¶ 14.)
On January 4, 2024, Ibarra purchased the Real Property in the name of the LLC. (FAC, ¶ 15.) As part of the purchase, Ibarra deposited $103,636.34 into escrow plus $13,000.00 as an origination point toward the purchase loan. (FAC, ¶ 16.) As part of the purchase, Ibarra signed a promissory note to the seller of the Real Property in the amount of $1,500,000 and, to induce the holder to subrogate the note to a new first loan to Rodriguez and Dandona, Ibarra’s attorney personally guaranteed the promissory note. (FAC, ¶ 17.) As part of the purchase, Ibarra signed a promissory note to Rodriguez and Dandona in the amount of $1,350,000. (FAC, ¶ 18.)
Notwithstanding the face failure of the promissory note, Rodriguez and Dandona transferred only $1,300,000 to the seller of the Real Property on Ibarra’s behalf. (FAC, ¶ 19.)
On January 8, 2024, almost immediately after closing, Rodriguez and Dandona demanded that Ibarra convey Ibarra’s interest in the LLC to Rodriguez and Dandona, claiming that they needed to have title to the Real Property in order to refinance the Real Property to pay off the seller and to cash out their equity from the Real Property so they could use the funds for other purposes. (FAC, ¶ 20.) On the same date, at the direction of Rodriguez, Ibarra revised the Operating Agreement of the LLC to replace Rodriguez and Dandona as the members of the LLC and Ibarra updated the Statement of Information filed with the Secretary of State to reflect the change. (FAC, ¶ 21.)
Notwithstanding the change of ownership of the LLC, Ibarra asserts he remains entitled to 24.87 percent ownership of the Real Property due to Ibarra’s agreement with Rodriguez and Dandona, as well as Ibarra’s contributions to the venture. (FAC, ¶ 22.)
In January 2024, Ibarra expended in excess of $313,648.78 in materials and labor to renovate the Real Property. (FAC, ¶ 23.)
Beginning in February 2024, after Ibarra expended over $430,000 to acquire, pay a financing charge, and improve the Real Property, Rodriguez and Dandona began leasing the Real Property to tenants but did not share copies of the leases with Ibarra or inform Ibarra of the income received from the leases. (FAC, ¶ 24.)
In September 2024, Ibarra, Rodriguez, and Dandona discussed a transfer of Rodriguez’s and Dandona’s interest in and to the LLC in exchange for Ibarra returning to Rodriguez and Dandona their initial contribution of $1,300,000. (FAC, ¶ 25.) Also in September 2024, Ibarra procured a loan commitment in order to return to Rodriguez and Dandona their initial $1,300,000 in exchange for a return of the LLC to Ibarra. (FAC, ¶ 26.)
In September 2024, Rodriguez’s and Dandona’s attorney drafted a Purchase, Sale, and Assignment of Membership Interest Agreement to transfer the LLC back to Ibarra, but, instead of the $1,300,000 discussed, the attorney drafted the agreement for a repayment to Rodriguez and Dandona of $1,474,000. (FAC, ¶ 27.) Because Rodriguez and Dandona materially changed the terms of the business transaction, the transfer of the LLC back to Ibarra in September 2024 did not conclude. (FAC, ¶ 28.)
On February 21, 2025, Rodriguez and Dandona listed the Real Property for sale without consulting Ibarra. (FAC, ¶ 29.) As of March 13, 2025, Rodriguez and Dandona have apparently accepted an offer to sell the Real Property without making arrangements to pay Ibarra his more than $430,000 contributed to the venture. (FAC, ¶ 30.) Ibarra opposes the sale of the Real Property without a return to him of $430,285.21. (FAC, ¶ 31.)
Ibarra remains legally obligated to pay the loans secured by the Real Property, including a promissory note for $1,500,000 that Ibarra’s counsel has personally guaranteed, plus a promissory note to Rodriguez and Dandona in the face amount of $1,350,000 (for which Rodriguez and Dandona only advanced $1,300,000). (FAC, ¶ 32.)
Additional allegations contained in the FAC will be discussed below where relevant.
Defendants now demur to each of the 10 causes of action. According to the proof of service, the demurrer and supporting documents were served on January 20, 2026.
Ibarra has not filed opposition or any other responsive document to the demurrer.
Analysis:
Request for Judicial Notice
Defendants request the court to take judicial notice of: (1) Notarized Quitclaim Deed signed by Ibarra on January 8, 2024; (2) Amended Operating Agreement of 4647 Carp Ave LLC, executed on January 4, 2024; (3) Resignation of Luis Ibarra from all positions held at 4647 Carp Ave LLC, executed by Ibarra on January 8, 2024; (4) Statement of Change in Control and Ownership of Legal Entities signed by Ibarra on March 6, 2024, to the State Board of Equalization; and (5) Purchase, Sale and Assignment of Membership Interest Agreement entered into on January 6, 2024, between Ibarra and Rodriguez and Dandona.
“When the ground of demurrer is based on a matter of which the court may take judicial notice pursuant to Section 452 or 453 of the Evidence Code, such matter shall be specified in the demurrer, or in the supporting points and authorities for the purpose of invoking such notice, except as the court may otherwise permit.” (Code Civ. Proc., § 430.70.)
Judicial notice may be taken of: “Facts and propositions that are not reasonably subject to dispute and are capable of immediate and accurate determination by resort to sources of reasonably indisputable accuracy.” (Evid. Code, § 452, subd. (h).)
“The trial court shall take judicial notice of any matter specified in Section 452 if a party requests it and:
“(a) Gives each adverse party sufficient notice of the request, through the pleadings or otherwise, to enable such adverse party to prepare to meet the request; and
“(b) Furnishes the court with sufficient information to enable it to take judicial notice of the matter.” (Evid. Code, § 453.)
“[J]udicial notice of a document does not extend to the truthfulness of its contents or the interpretation of statements contained therein, if those matters are reasonably disputable. [Citations.] Our Supreme Court noted this limitation in StorMedia Inc. v. Superior Court (1999) 20 Cal.4th 449, 84 Cal.Rptr.2d 843, 976 P.2d 214 (StorMedia), explaining: “ ‘In ruling on a demurrer, a court may consider facts of which it has taken judicial notice. (Code Civ. Proc., § 430.30, subd. (a).) This includes the existence of a document. When judicial notice is taken of a document, however, the truthfulness and proper interpretation of the document are disputable. [Citation.] . . ..’ ” [Citation.]” (Apple Inc. v. Superior Court (2017) 18 Cal.App.5th 222, 241.)
“The hearing on demurrer may not be turned into a contested evidentiary hearing through the guise of having the court take judicial notice of documents whose truthfulness or proper interpretation are disputable.” (Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 114 (Fremont).)
“ ‘Courts can take judicial notice of the existence, content and authenticity of public records and other specified documents, but do not take judicial notice of the truth of the factual matters asserted in those documents.’ ” [Citation.]” (Dominguez v. Bonta (2022) 87 Cal.App.5th 389, 400.)
The court will take judicial notice of the documents but not the truth of factual matters asserted in the documents. The court notes that, as they pertain to the present demurrer, the documents are largely irrelevant and open to conflicting interpretations.
Standard on Demurrer
“The party against whom a complaint or cross-complaint has been filed may object, by demurrer or answer as provided in Section 430.30, to the pleading on any one or more of the following grounds:
“(a) The court has no jurisdiction of the subject of the cause of action alleged in the pleading.
“(b) The person who filed the pleading does not have the legal capacity to sue.
“(c) There is another action pending between the same parties on the same cause of action.
“(d) There is a defect or misjoinder of parties.
“(e) The pleading does not state facts sufficient to constitute a cause of action.
“(f) The pleading is uncertain. As used in this subdivision, “uncertain” includes ambiguous and unintelligible.
“(g) In an action founded upon a contract, it cannot be ascertained from the pleading whether the contract is written, is oral, or is implied by conduct.
“(h) No certificate was filed as required by Section 411.35.” (Code Civ. Proc., § 430.10.)
“When any ground for objection to a complaint, cross-complaint, or answer appears on the face thereof, or from any matter of which the court is required to or may take judicial notice, the objection on that ground may be taken by a demurrer to the pleading.” (Code Civ. Proc., § 430.30, subd. (a).)
“[A] court must treat a demurrer as admitting all material facts properly pleaded, it does not, however, assume the truth of contentions, deductions or conclusions of law.” (Travelers Indem. Co. of Connecticut v. Navigators Specialty Ins. Co. (2021) 70 Cal.App.5th 341, 358, citing Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967.)
“To survive a demurrer, the complaint need only allege facts sufficient to state a cause of action; each evidentiary fact that might eventually form part of the plaintiff’s proof need not be alleged.” (C.A. v. William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872.)
A demurrer searches for defects in the allegations of the pleading. “A demurrer is simply not the appropriate procedure for determining the truth of disputed facts.” (Ramsden v. Western Union (1977) 71 Cal.App.3d 873, 879.)
First Cause of Action for Conversion
“Conversion is generally described as the wrongful exercise of dominion over the personal property of another. [Citation.] The basic elements of the tort are (1) the plaintiff’s ownership or right to possession of personal property; (2) the defendant’s disposition of the property in a manner that is inconsistent with the plaintiff’s property rights; and (3) resulting damages. [Citation.]” (Fremont, supra, 148 Cal.App.4th at p. 119.)
Defendants argue that the FAC “alleges that Plaintiff advanced funds and performed work with the understanding that he would be repaid if and when the Property sold, and only from the proceeds of that sale. The FAC does not allege that the Property has sold or that Defendants refused to pay Plaintiff any amounts that are presently due. Where payment is contingent on a future sale that has not yet occurred, Plaintiff has no immediate right to possession of funds, and Defendants’ retention of money pending that contingency cannot constitute conversion. At most, Plaintiff alleges dissatisfaction with the timing or amount of a potential repayment, claims that sound in contract or equity, not tort.” (Demurrer, p. 12, ll. 16-23.)
The court notes that nowhere in the FAC does Ibarra allege that he had an understanding that he would only be repaid “if and when the Property sold.” Ibarra, in fact, alleges that he opposes the sale without the return to him of $430,285.21. (FAC, ¶ 31.)
In addition to the allegations of the FAC cited above, Ibarra alleges:
“Defendants 4647 Carp Ave LLC, owned by co-Defendants Juan Rodriguez and Sara Dandona acted in concert with one another, and aided and abetted each other, to solicit and receive $430,285.21 of funds owned by Plaintiff Luis Ibarra.” (FAC, ¶ 34.)
“Defendants converted $430,285.21 of Plaintiff Luis Ibarra’s property by wrongful acts. Namely, Defendants convinced Plaintiff to use his funds to acquire and then improve the Real Property but have not made arrangements to return these funds to Plaintiff while Defendants are attempting to sell the Real Property without Plaintiff’s consent or knowledge.” (FAC, ¶ 35.)
In the most simplistic terms, Ibarra has adequately alleged that defendants took possession of Ibarra’s funds, utilized it for purposes that are inconsistent with Ibarra’s rights to those funds, and that Ibarra has been financially damaged by defendants’ disposition of those funds. The allegations are sufficient to overcome demurrer.
The demurrer to the first cause of action will be overruled.
Second Cause of Action for Fraud and Third Cause of Action for Constructive Fraud
Reading the FAC as a whole, Ibarra’s fraud allegations sound in promissory fraud. Ibarra alleges: “Defendants 4647 Carp Ave LLC, owned by co-Defendants Juan Rodriguez and Sara Dandona represented to Plaintiff that Defendants would return to Plaintiff the $430,285.21 worth of funds that Plaintiff spent to acquire and improve the Real Property and pay a financing charge.” (FAC, ¶ 39.)
“ ‘An action for promissory fraud may lie where a defendant fraudulently induces the plaintiff to enter into a contract.’ ” [Citation.] The action is one of deceit, which requires proof that the defendant made a misrepresentation of fact or a promise without any intention of performing it. (Civ. Code, § 1710.) A complaint for fraud must allege the following elements: (1) a knowingly false representation by the defendant; (2) an intent to deceive or induce reliance; (3) justifiable reliance by the plaintiff; and (4) resulting damages. [Citation.] Every element must be specifically pleaded.” (Service by Medallion, Inc. v. Clorox Co. (1996) 44 Cal.App.4th 1807, 1816.)
“[F]raud must be pled specifically; general and conclusory allegations do not suffice. . . . This particularity requirement necessitates pleading facts which show how, when, where, to whom, and by what means the representations were tendered.” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.)
“Less specificity should be required of fraud claims “ ‘when ‘it appears from the nature of the allegations that the defendant must necessarily possess full information concerning the facts of the controversy,’ ” [citation]; “ ‘[e]ven under the strict rules of common law pleading, one of the canons was that less particularity is required when the facts lie more in the knowledge of the opposite party. . . .’ ” [Citation.] (Alfaro v. Community Housing Improvement System & Planning Assn., Inc. (2009) 171 Cal.App.4th 1356, 1384.)
Viewing the complaint as a whole, and all subparts in context, Ibarra has pled all elements of fraud, including the “how, when, where, to whom, and by what means the representations were tendered.” Specific facts are set forth not only in the portions of the FAC cited above but in the section entitled “Overview of Case” beginning at page 4 of the FAC. Ibarra also sufficiently pleads the elements of fraud noted above.
For constructive fraud: “Unlike actual fraud, constructive fraud depends on the existence of a fiduciary relationship of some kind, and this must be alleged.” (Younan v. Equifax Inc. (1980) 111 Cal.App.3d 498, 516–517.) “The elements of 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).” (Id. at p. 516, fn. 14.)
Defendants argue that Ibarra has failed to plead sufficient facts of a fiduciary relationship. However, Ibarra clearly, despite defendants’ argument to the contrary, alleges a joint venture.
“ ‘A joint venture exists when there is ‘ “an agreement between the parties under which they have a community of interest, that is, a joint interest, in a common business undertaking, an understanding as to the sharing of profits and losses, and a right of joint control.” ’ ” (Connor v. Great Western Sav. & Loan Assn. (1968) 69 Cal.2d 850, 863; CACI No. 3712.)” (Simmons v. Ware (2013) 213 Cal.App.4th 1035, 1053, as modified on denial of reh’g (Mar. 13, 2013).)
While defendants argue that Ibarra had no right of joint control, reading the complaint as a whole, Ibarra alleges that he did, and does, have that right. Whether he had a right of joint control is a matter of proof that is unsuitable for disposition at the pleading stage. The allegations are sufficient.
It has long been the law in California that: “The responsibilities of parties participating in a joint venture are governed by the same standards as are applicable to partners. [Citation.] Thus it follows that the relationship between the parties hereto was that of a fiduciary, and hence each party owed to the other the highest loyalty and utmost good faith. [Citation.]” (Nielsen v. Wong (1960) 182 Cal.App.2d 582, 586.)
The demurrer to the second and third causes of action will be overruled.
Fourth Cause of Action for Breach of Fiduciary Duty
“ ‘ “The elements of a cause of action for breach of fiduciary duty are: (1) existence of a fiduciary duty; (2) breach of the fiduciary duty; and (3) damage proximately caused by the breach.” ’ ” [Citation.] The breach of fiduciary duty can be based upon either negligence or fraud, depending on the circumstances. [Citations.]” (Tribeca Companies, LLC v. First American Title Ins. Co. (2015) 239 Cal.App.4th 1088, 1114.)
Defendants’ argument is essentially that Ibarra has failed to allege sufficient facts to establish the existence of a joint venture or a fiduciary relationship. Both of those arguments are addressed above, and they fail here for the same reasons.
The demurrer to the fourth cause of action will be overruled.
Fifth Cause of Action for Breach of Contract
“A contract is an agreement to do or not do a certain thing.” (Civ. Code, § 1549.)
“It is essential to the existence of a contract that there should be:
“1. Parties capable of contracting;
“2. Their consent;
“3. A lawful object; and,
“4. A sufficient cause or consideration.” (Civ. Code § 1550.)
The essential elements of a cause of action for breach of contract are “(1) the contract; (2) the plaintiff’s performance of the contract or excuse for nonperformance; (3) the defendant’s breach; and (4) the resulting damage to the plaintiff.” (Richman v Hartley (2014) 224 Cal. App. 4th 1182, 1186.)
“A contract is either express or implied.” (Civ. Code, § 1619.) “An implied contract is one, the existence and terms of which are manifested by conduct.” (Civ. Code, § 1621.)
Implied contractual terms ordinarily stand on equal footing with express terms. (See, e.g., Kahsmiri v. Regents of University of California (2007) 156 Cal.App.4th 809, 829.)
Typically, in a breach of contract action, plaintiffs either set out the terms of a contract verbatim, or, more frequently, include a copy of the contract as an exhibit to the complaint. Heritage Pacific Financial, LLC v. Monroy (2013) 215 Cal.App.4th 972 (Heritage), addresses this often-argued issue. Heritage does not require plaintiffs to plead all terms of the contract verbatim or to include a copy of the contact as an exhibit to the complaint. Heritage specifically holds that a contract may be pleaded by its legal effect. “In order to plead a contract by its legal effect, plaintiff must allege the substance of its relevant terms.” (Id., at p. 993, italics added.)
Here, in addition to the allegations cited above and those in the “Overview of Case” section, Ibarra alleges:
“Defendants 4647 Carp Ave LLC, owned by co-Defendants Juan Rodriguez and Sara Dandona are in an oral contract with Plaintiff to return to Plaintiff his capital contribution of at least $430,285.21, which oral agreement is memorialized by written memoranda including the closing statement for the purchase of the Real Property, the LLC Operating Agreement, receipts of funds by First American Title Company, and written communications via text and emails between Plaintiff and Defendants in which the parties agreed they would own the Real Property in pro-rata portions [based upon the actual numbers, this is 24.87% to Plaintiff; 75.13% to Defendants.” (FAC, ¶ 58.)
It is clear from the FAC that the “contract” refers to a series of agreements between Ibarra and Rodriguez and Dandona. It is also clear from the FAC what the alleged breaches of those contracts consist of.
Ibarra also alleges his performance of the contract, defendants’ breach of the contract, and resulting damages.
The demurrer to the fifth cause of action will be overruled.
Sixth Cause of Action for Unjust Enrichment
Defendants argue that unjust enrichment is not recognized as an independent cause of action. Defendants are correct.
“[T]here is no cause of action in California for unjust enrichment. “ ‘The phrase ‘ “Unjust Enrichment” ’ does not describe a theory of recovery, but an effect: the result of a failure to make restitution under circumstances where it is equitable to do so.’ ” [Citation.] Unjust enrichment is “ ‘ “a general principle, underlying various legal doctrines and remedies,” ’ ” rather than a remedy itself. [Citation.] It is synonymous with restitution. [Citation.]” (Melchior v. New Line Productions, Inc. (2003) 106 Cal.App.4th 779, 793.)
The issue is merely one of labeling.
“If the complaint states a cause of action under any theory, regardless of the title under which the factual basis for relief is stated, that aspect of the complaint is good against a demurrer. “ ‘[W]e are not limited to plaintiffs’ theory of recovery in testing the sufficiency of their complaint against a demurrer, but instead must determine if the factual allegations of the complaint are adequate to state a cause of action under any legal theory. The courts of this state have . . . long since departed from holding a plaintiff strictly to the ‘form of action’ he has pleaded and instead have adopted the more flexible approach of examining the facts alleged to determine if a demurrer should be sustained.’ ” [Citations.]” (Quelimane Co. v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 38-39.)
Even though not technically a recognized cause of action, “we will construe the [unjust enrichment] cause of action as a quasi-contract claim seeking restitution.” (Rutherford Holdings, LLC v. Plaza Del Rey (2014) 223 Cal.App.4th 221, 231.)
Defendants are also correct that an unjust enrichment, or quasi-contract claim seeking restitution, applies only where there is no enforceable contract.
However: “[M]odern rules of pleading generally permit plaintiffs to “ ‘set forth alternative theories in varied and inconsistent counts.’ ” (Rader Co. v. Stone (1986) 178 Cal.App.3d 10, 29; see Mendoza v. Continental Sales Co. (2006) 140 Cal.App.4th 1395, 1402, [“ ‘the modern practice allows that party to plead in the alternative and make inconsistent allegations’ ”].) Thus, if a plaintiff was uncertain as to whether the parties had entered into an enforceable agreement, the plaintiff would be entitled to plead inconsistent claims predicated on both the existence and absence of such an agreement. (See Rader Co. v. Stone, supra, 178 Cal.App.3d at p. 29, [plaintiff “ ‘is not precluded by law from alleging in one cause of action the breach of a contract and an inconsistent theory of recovery in another cause of action’ ”].)” (Klein v. Chevron U.S.A., Inc. (2012) 202 Cal.App.4th 1342, 1388, as modified on denial of reh’g (Feb. 24, 2012).)
The court will view the sixth cause of action as a quasi-contract claim seeking restitution on an alternative theory of recovery.
The demurrer to the sixth cause of action will be overruled.
Seventh Cause of Action for Negligence
“To succeed in a negligence action, the plaintiff must show that (1) the defendant owed the plaintiff a legal duty, (2) the defendant breached the duty, and (3) the breach proximately or legally caused (4) the plaintiff’s damages or injuries.” (Thomas v. Stenberg (2012) 206 Cal.App.4th 654, 662.)
“[I]t is established that a cause of action may be stated in which negligence is alleged in general terms . . ..” (Guilliams v. Hollywood Hospital (1941) 18 Cal.2d 97, 101.)
Defendants argue that there was no duty to Ibarra and cite Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965, 985, stating “a duty may be (1) imposed by law, (2) assumed by defendant, or (3) arise out of a special relationship between plaintiff and defendant.” (Demurrer, p. 18, ll. 22-24.) As discussed above, the parties to a joint venture do have a special relationship, as the existence of the joint venture creates a fiduciary relationship.
Defendants next argue that Ibarra’s tort claims are based on defendants’ alleged breach of contract and that a breach of contract becomes tortious only when it violates an independent duty arising from principles of tort law. (Demurrer, p. 19, ll. 2-7.)
While it is true that there is a general rule prohibiting tort damages for breach of contract, there are exceptions.
“[A] party’s contractual obligation may create a legal duty and that a breach of that duty may support a tort action. We stated, ‘ “[C]onduct amounting to a breach of contract becomes tortious only when it also violates a duty independent of the contract arising from principles of tort law. [Citation.]” ’ (Ibid.) [¶] We went on to describe several instances where tort damages were permitted in contract cases. ‘ “Tort damages have been permitted in contract cases where a breach of duty directly causes physical injury [citation]; for breach of the covenant of good faith and fair dealing in insurance contracts [citation]; for wrongful discharge in violation of fundamental public policy [citation]; or where the contract was fraudulently induced. [citation.]” ’ ‘ “[I]n each of these cases, the duty that gives rise to tort liability is either completely independent of the contract or arises from conduct which is both intentional and intended to harm. [Citation.]” ’ [Citations.]’ ” [Citation.]” (Benavides v. State Farm General Ins. Co. (2006) 136 Cal.App.4th 1241, 1251–1252, italics added.)
Here, in addition to the existence of a special relationship, there are allegations of fraudulent inducement. The negligence cause of action is not barred in these circumstances.
The demurrer to the seventh cause of action will be overruled.
Eighth Cause of Action for Equitable Estoppel
“The basic principles of equitable estoppel are well established and easily stated. “ ‘Whenever a party has, by his own statement or conduct, intentionally and deliberately led another to believe a particular thing true and to act upon such belief, he is not, in any litigation arising out of such statement or conduct, permitted to contradict it.’ ” (Evid.Code, § 623.) “ ‘ “Generally speaking, four elements must be present in order to apply the doctrine of equitable estoppel: (1) the party to be estopped must be apprised of the facts; (2) he must intend that his conduct shall be acted upon, or must so act that the party asserting the estoppel had a right to believe it was so intended; (3) the other party must be ignorant of the true state of facts; and (4) he must rely upon the conduct to his injury.” ’ ” [Citations.]” (Honeywell v. Workers’ Comp. Appeals Bd. (2005) 35 Cal.4th 24, 37.)
In addition to the allegations discussed above, Ibarra alleges:
“Defendants 4647 Carp Ave LLC, owned by co-Defendants Juan Rodriguez and Sara Dandona knew that they intended to convert Plaintiff’s funds, Defendants knew that they were not intending to return Plaintiff’s funds to Plaintiff, and Defendants knew that they should have obtained Plaintiff’s consent and informed Plaintiff that they intended to sell the Real Property without making arrangements to return Plaintiff’s funds to Plaintiff.” (FAC, ¶ 74.)
“Defendants intended their conduct and representations to be acted upon by Plaintiff and Defendants repeatedly told Plaintiff they would return Plaintiff’s funds to him.” (FAC, ¶ 75.)
“Plaintiff was unaware that Defendants intended to defraud Plaintiff and deprive Plaintiff of his funds.” (FAC, ¶ 76.)
“Plaintiff relied upon Defendants’ conduct and representations to Plaintiff’s detriment in a sum of not less than $430,285.21.” (FAC, ¶ 77.)
“Plaintiff is entitled to an Equitable Lien against the Real Property to protect Plaintiff’s interest in the Real Property and Plaintiff’s $430,285.21 of funds expended to acquire and improve the Real Property.” (FAC, ¶ 78.)
The allegations are sufficient to overcome defendants’ demurrer. The demurrer to the eighth cause of action will be overruled.
Ninth Cause of Action for Quiet Title
A quiet title complaint “shall be verified and shall include all of the following:
“(a) A description of the property that is the subject of the action. In the case of tangible personal property, the description shall include its usual location. In the case of real property, the description shall include both its legal description and its street address or common designation, if any.
“(b) The title of the plaintiff as to which a determination under this chapter is sought and the basis of the title. If the title is based upon adverse possession, the complaint shall allege the specific facts constituting the adverse possession.
“(c) The adverse claims to the title of the plaintiff against which a determination is sought.
“(d) The date as of which the determination is sought. If the determination is sought as of a date other than the date the complaint is filed, the complaint shall include a statement of the reasons why a determination as of that date is sought.
“(e) A prayer for the determination of the title of the plaintiff against the adverse claims.” (Code Civ. Proc., § 761.020, italics added.)
Ibarra alleges:
“Plaintiff asserts that Plaintiff is a co-owner of the Real Property in an amount of not less than 24.87% based upon Plaintiff’s financial contribution of $430,285.21 when compared to Defendants’ contribution of $1,300,000.” (FAC, ¶ 80.)
“Plaintiff therefore owns at least 24.87% of the following Real Property:
“The Land referred to herein is situated in the County of Santa Barbara, State of California, and is described as follows:
“Lots 43 and 44 of Official Records of the Reynolds Subdivision in the City of Carpinteria as shown on map filed in Book 15, Page 62 of Maps in the Office of the County Recorder of said County, State of California described as follows:
“Beginning at the Northeast corner of said Lot 43;
“Thence along the Northerly boundary line of said Lots 43 and 44, North 85°52’00” West, 108.00 feet to the Northwest corner of said Lot 44;
“Thence along the Westerly boundary line of said Lot 44, South 4°08’00” West, 100.00 feet to the Southwest corner of said Lot 44;
“Thence along the Southerly boundary line of said Lots 44 and 43, South 85°52’00” East, 108.00 feet to the Southeast corner of said Lot 43;
“Thence along the Easterly boundary line of said Lot 43, North 4°08’00” East, 100.00 feet to the point of beginning.
“Said land is described and depicted in that certain Certificate and Declaration of Voluntary Merger recorded March 7, 2005 as Instrument No. 2005-0020262 of Official Records.
“Santa Barbara County Assessor’s Parcel Number 039-311-003 which currently has the address of 4647 Carpinteria Avenue, Carpinteria, CA 93013.” (FAC, ¶ 81.)
“Plaintiff acquired title to the Real Property as the original owner of the LLC as per that Grant Deed recorded in the Official Records of Santa Barbara County Document #2024-0000389 recorded on January 4, 2024.” (FAC, ¶ 82.)
“Defendants 4647 Carp Ave LLC, owned by co-Defendants Juan Rodriguez and Sara Dandona defrauded Plaintiff into changing ownership of the LLC in order to deprive Plaintiff of his rightful title to 4647 Carp Ave LLC.” (FAC, ¶ 83.)
“Plaintiff remains legally obligated to pay the loans secured by the Real Property including a promissory note for $1,500,000 that Plaintiff’s undersigned counsel has personally guaranteed, plus a promissory note to Defendants in a face amount of $1,350,000 (for which Defendants only advanced $1,300,000 and thus Plaintiff owes Defendants $1,300,000 secured by the Real Property).” (FAC, ¶ 84.)
While defendants improperly attempt to argue the merits of the cause of action on demurrer, the allegations themselves are sufficient to overcome demurrer. However, the complaint must be verified.
The demurrer to the ninth cause of action will be provisionally overruled and Ibarra will be ordered to file and serve a verification of the FAC. If Ibarra fails to file and serve a verification of the FAC by the date given, the demurrer to the ninth cause of action will be sustained with leave to amend.
Tenth Cause of Action for Accounting
“An action for an accounting has two elements: (1) “ ‘that a relationship exists between the plaintiff and defendant that requires an accounting’ ” and (2) “ ‘that some balance is due the plaintiff that can only be ascertained by an accounting.’ ” [Citations.] The action carries with it an inherent limitation; an accounting action “ ‘is not available where the plaintiff alleges the right to recover a sum certain or a sum that can be made certain by calculation.’ ” [Citations.]” (Sass v. Cohen (2020) 10 Cal.5th 861, 869.)
Defendants’ first argument is that Ibarra has failed to allege facts establishing any fiduciary relationship between the party. Although Ibarra has, as discussed above, pled facts sufficient to show the existence of a fiduciary relationship, a fiduciary relationship is not required for an accounting cause of action.
“[A] fiduciary relationship between the parties is not required to state a cause of action for accounting. All that is required is that some relationship exists that requires an accounting. [Citation.] The right to an accounting can arise from the possession by the defendant of money or property which, because of the defendant’s relationship with the plaintiff, the defendant is obliged to surrender.” (Teselle v. McLoughlin (2009) 173 Cal.App.4th 156, 179–180.)
Defendants next, and final argument, is that an accounting is unavailable where plaintiff seeks to recover a sum certain or a sum that can be made certain by calculation. This is a correct statement of the law. However, reading the complaint as a whole, and all subparts in context, the FAC is not seeking a sum certain. Defendants fail to acknowledge that, in addition to the request that defendants account for the $430,285.21, Ibarra is seeking information regarding rents that Ibarra claims he is entitled to as a partial owner of the Real Property. As Ibarra alleges he does not know how much rent was received, or how the rent proceeds were used, Ibarra is not necessarily seeking a sum certain.
“Defendants claimed repeatedly to Plaintiff that they would return Plaintiff’s funds by Defendants did not account to Plaintiff for rents received by the de facto joint venture between Plaintiffs and Defendants.” (FAC, ¶ 87.)
“Defendants failed to account to Plaintiff for his funds used to acquire and improve the Real Property and Defendants did not account to Plaintiff for rents received by the de facto joint venture between Plaintiff and Defendants.” (FAC, ¶ 88.)
The allegations are sufficient to overcome demurrer. The demurrer to the tenth cause of action will be overruled.