Enamorado v. Pimentel

Filed 8/29/06 Enamorado v. Pimentel CA2/7

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

APPEAL from an order of dismissal of the Superior Court of Los Angeles County, Barbara Scheper, Judge. Reversed and remanded with directions.

Law Offices of Tabone and Derek L. Tabone for Plaintiff and Appellant.

No appearances for Defendants and Respondents.

Karina Pena Enamorado appeals from the order of dismissal entered after the trial court sustained without leave to amend the demurrers filed by all defendants to her first amended complaint for fraud, fraudulent concealment, breach of contract, breach of the implied covenant of good faith and fair dealing and intentional infliction of emotional distress. Enamorado contends she adequately pleaded facts sufficient to support her contract and tort claims and, at minimum, was entitled to leave to amend. We reverse in part and remand for further proceedings consistent with this opinion.

Factual and Procedural Background

1. Enamorado’s Ill-fated Effort to Purchase a Home[1]

Enamorado wanted to purchase a home. In August 2003 she located a town house for sale in Panorama City that interested her. However, when she spoke to her real estate agent, Vallarta Finance and Realty (Vallarta), about purchasing the property, Vallarta and its employee Rossana Reyes informed her she would be unable to obtain financing.

Enamorado then contacted Pedro Mendez. (Enamorado’s first amended complaint fails to describe Mendez’s relationship to Enamorado or to the other defendants.) Mendez suggested Enamorado find a “straw buyer” who would obtain the loan necessary to purchase the town house and then transfer the property to her after she paid a service fee. Mendez introduced Enamorado to Luis Pimentel, Sr., who offered to obtain a loan in his name, purchase the property and execute a quit claim deed to Enamorado after payment of a $5,000 service fee. Enamorado and Pimentel, Sr. orally agreed to this transaction. Unbeknownst to Enamorado, Luis Pimentel, Jr., Pimentel, Sr.’s son, not Pimentel, Sr. himself, obtained the necessary loans and purchased the property.

Enamorado paid the $4,000 down payment required to purchase the property (whether the payment was made directly to the seller or to Pimentel, Sr. or Pimentel, Jr. is not specified) and began making payments to Pimentel, Sr. for his service fee and to the two lenders who had provided financing for the transaction. After sending her final $1,300 payment to Pimentel, Sr., Enamorado learned it was actually Pimentel, Jr. who had obtained the loans and purchased the property. Pimentel, Jr. initially agreed to convey the property to Enamorado upon her full payment of the $5,000 service fee. Shortly thereafter, however, Pimentel, Jr. demanded more money from Enamorado: $15,000, $20,000 and finally $30,000. At that point, Enamorado stopped payment on her $1,300 check and filed a small claims action against Pimentel, Sr. Hours before the small claims action was scheduled for trial, Pimentel, Jr. sold the property to Vidal Arreguin.

2. The Small Claims Case

In her small claims action against Pimental, Sr., filed on August 6, 2004, Enamorado sought $2,600 “she had paid him to transfer a grant deed for a town home.” Following an evidentiary hearing, the court ruled in favor of Enamorado and awarded her $2,600 plus $52 in costs. The court’s judgment was enforceable “unless the property transfer [to Enamorado was] completed and recorded by September 15, 2004.” The court also stated its intention to refer the matter to the District Attorney to investigate “violation of consumer fraud lending laws, possible harassment, and possible forgery of Pimentel’s son’s signature.” Enamorado’s efforts to enforce the judgment against Pimentel, Sr. were unsuccessful.

3. Enamorado’s Action for Breach of Contract, Fraud and Related Torts

a. Enamorado’s original complaint and the defendants’ demurrers

On October 28, 2004 Enamorado filed a complaint in Los Angeles Superior Court against Pimentel, Sr., Pimentel, Jr., Vallarta, Reyes, Mendez and Arreguin alleging fraud, fraudulent concealment, conspiracy, intentional infliction of emotional distress, breach of contract and breach of the implied covenant of good faith and fair dealing. Against Arreguin alone she also purported to state causes of action for injunction and constructive trust.

Arreguin demurred to the complaint, arguing the action was barred by res judicata and collateral estoppel, as well as by the statute of frauds, and the claims against him were fatally uncertain. In considering his demurrer Arreguin requested the court take judicial notice of the small claims judgment, a petition for a civil harassment restraining order filed by Enamorado against “Luis Pimentel” (whether Pimentel, Sr. or Pimentel, Jr. is not specified) and the grant deed for the property. Vallarta, Reyes and Mendez also filed a general demurrer to the complaint, asserting the same grounds as Arreguin.[2]

The trial court sustained Arreguin’s demurrer without leave to amend as to the constructive trust and injunction claims, ruling they were remedies, not causes of action. The trial court also sustained without leave to amend both demurrers to the conspiracy claim, finding Enamorado had not pleaded “with specificity the alleged acts which form the basis of the conspiracy” and that “conspiracy is not a cause of action“ and “cannot stand alone.” The demurrers to all other causes of action were sustained with leave to amend: The court found all claims against Arreguin were barred because he was a bona fide purchaser for value of the property. The demurrer of Reyes, Mendez and Vallarta to the fraudulent concealment claim was sustained because Enamorado had failed to plead the basis for a duty to disclose and to the fraud claim because she did not plead with specificity when and how the alleged fraud had been committed. The alleged breach of contract claim was defective because Enamorado did not allege these defendants were parties to her contract with Pimentel, Sr. or otherwise plead facts that would support liability for an alleged breach of contract, including the implied covenant of good faith and fair dealing. Finally, the court found insufficient Enamorado’s allegations that the demurring defendants had intentionally engaged in outrageous conduct.

b. The first amended complaint, the defendants’ demurrers and the orders sustaining the demurrers without leave to amend and dismissing the action

Enamorado filed a first amended complaint, again alleging fraudulent concealment (against Reyes, Mendez and Vallarta), fraud (against all defendants), breach of contract (against Pimentel, Sr. and Pimentel, Jr.), breach of the implied covenant of good faith and fair dealing (against Pimentel, Sr., Pimentel, Jr., Reyes, Vallarta and Mendez) and intentional infliction of emotional distress (against all defendants).[3] Arreguin filed his own demurrer to the first amended complaint; the other defendants (including Pimentel, Sr. and Pimentel, Jr.) collectively demurred to the first amended complaint and joined Arreguin’s demurrer.

The defendants argued Enamorado’s first amended complaint still did not plead her fraud claims with sufficient specificity and failed to allege facts to support all elements of her intentional infliction of emotional distress claim. Arreguin again asserted Enamorado’s claims against him were prohibited by his status as a bona fide purchaser, and Pimentel, Sr. argued res judicata barred all of Enamorado’s claims as to him. All defendants asserted Enamorado’s contract claims were precluded by the statute of frauds and she was barred from litigating her claims on the basis of collateral estoppel, arguing the small claims court’s monetary judgment in Enamorado’s favor constituted an implied finding she was not entitled to possession of the property.

The trial court sustained the demurrers to all causes of action without leave to amend, finding Enamorado’s first amended complaint failed to cure the various pleading deficiencies identified by the court in sustaining the demurrers to the original complaint. The court entered an order dismissing the action pursuant to Code of Civil Procedure section 581, subdivision (f)(1),[4] and Enamorado filed a timely notice of appeal.

Discussion

1. Standard of Review

On appeal from an order dismissing a complaint after the sustaining of a demurrer, we independently review the pleading to determine whether the facts alleged state a cause of action under any possible legal theory. (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967; Berger v. California Ins. Guarantee Assn. (2005) 128 Cal.App.4th 989, 998.) We give the complaint a reasonable interpretation, “treat[ing] the demurrer as admitting all material facts properly pleaded,” but do not “assume the truth of contentions, deductions or conclusions of law. [Citation.]” (Aubry, at p. 967.) We liberally construe the pleading with a view to substantial justice between the parties. (§ 452; Kotlar v. Hartford Fire Ins. Co. (2000) 83 Cal.App.4th 1116, 1120.)

“‘Where the complaint is defective, “[i]n the furtherance of justice great liberality should be exercised in permitting a plaintiff to amend his [or her] complaint.”’” (Aubry v. Tri-City Hospital Dist., supra, 2 Cal.4th at p. 970.) Leave to amend may be granted on appeal even in the absence of a request by the plaintiff to amend the complaint. (Id. at p. 971; see § 472c, subd. (a).) We determine whether the plaintiff has shown “in what manner he [or she] can amend [the] complaint and how that amendment will change the legal effect of [the] pleading.” (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349.) “[L]eave to amend should not be granted where . . . amendment would be futile.” (Vaillette v. Fireman’s Fund Ins. Co. (1993) 18 Cal.App.4th 680, 685.) Leave to amend should be granted when the plaintiff has demonstrated a “reasonable possibility” that she can amend any of her claims to state viable causes of action. (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.)

2. The Trial Court Properly Sustained the Demurrers to Enamorado’s Claims for Breach of Contract and Breach of the Covenant of Good Faith and Fair Dealing.

a. Res judicata bars Enamorado’s contract claims against Pimentel, Sr.

Under the doctrine of res judicata, a valid, final judgment on the merits precludes parties or their privies from relitigating the same “cause of action” in a subsequent suit. (Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896 (Mycogen); Slater v. Blackwood (1975) 15 Cal.3d 791, 795.) “Res judicata, or claim preclusion, prevents relitigation of the same cause of action in a second suit between the same parties or parties in privity with them . . . . [Citation.] Under the doctrine of res judicata, if a plaintiff prevails in an action, the cause is merged into the judgment and may not be asserted in a subsequent lawsuit; a judgment for the defendant serves as a bar to further litigation of the same cause of action.” (Mycogen, at pp. 896-897, fn. omitted.)

The doctrine of res judicata is properly applied based on the judgment of the small claims court: “[The] judgment of the small claims court may operate to merge with or bar a subsequent proceeding on the same cause of action . . . .” (Perez v. City of San Bruno (1980) 27 Cal.3d 875, 884.) A judgment of any court, “whether of high or low jurisdiction, and of record or not, [can act as] a complete bar against a second suit on the same cause of action.” (Sanderson v. Niemann (1941) 17 Cal.2d 563, 573, italics omitted.)

The claim Enamorado successfully pursued in small claims court sought recovery of $2,600 she had paid pursuant to her agreement with Pimentel, Sr. Whether viewed as a request for rescission or for damages,[5] there can be no question Enamorado was asserting a contract claim that now prevents her from relitigating that same cause of action. (Mycogen, supra, 28 Cal.4th at p. 896.)

b. Enamorado failed to plead the existence of an independent contract claim against Pimentel, Jr. and res judicata bars any claim that Pimentel, Sr. was his agent

Although paragraph 17 of the first amended complaint includes an allegation that “Pimentel, Jr. had agreed to execute a quit claim deed in favor of [Enamorado] for the subject property” in exchange for payment of $5,000 to Pimentel, Sr. and Pimentel, Jr., Enamorado does not contend Pimentel, Jr. was a party to her agreement with his father. Instead, she argues an agency relationship existed between Pimentel, Sr. and Pimentel, Jr., which permits her to assert her contract claims against both father and son. Under this theory, however, Enamorado’s claim is also barred by res judicata because Pimentel, Jr., although not a party to the small claims court action, stands in privity to Pimentel, Sr. (Mycogen, supra, 28 Cal.4th at p. 896; see Clemmer v. Hartford Insurance Co. (1978) 22 Cal.3d 865, 875 [“Privity is a concept not readily susceptible of uniform definition. Traditionally it has been held to refer to an interest in the subject matter of litigation acquired after rendition of the judgment through or under one of the parties, as by inheritance, succession or purchase. [Citation.] The concept has also been expanded to refer to a mutual or successive relationship to the same rights of property, or to such an identification in interest of one person with another as to represent the same legal rights [citations] and, more recently, to a relationship between the party to be estopped and the unsuccessful party in the prior litigation which is ‘sufficiently close’ so as to justify application of the doctrine of collateral estoppel.”].)

c. Enamorado’s claims for breach of the implied covenant of good faith and fair dealing are contract claims that require an enforceable contractual relationship

“The covenant of good faith and fair dealing, implied by law in every contract, exists merely to prevent one contracting party from unfairly frustrating the other party’s right to receive the benefits of the agreement actually made.“ (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 349.) “[T]he remedy for breach of an . . . agreement, including the covenant of good faith and fair dealing implied by law therein, is solely contractual.“ (Id. at p. 352.) The cause of action for breach of the implied covenant depends on the existence of an enforceable contract: In the absence of a contract there is no cause of action for breach of the implied covenant. (Id. at p. 353.)

Because Enamorado’s contract claims against Pimentel, Sr. and Pimentel, Jr. are barred by the doctrine of res judicata, her contractual claims for breach of the implied covenant are similarly barred. As to Vallarta, Reyes and Mendez, although purporting to assert a claim for breach of the implied covenant of good faith and fair dealing, Enamorado concedes they were not parties to her oral agreement with Pimentel, Sr. Enamorado has failed to allege the existence of any other contractual relationship between her and these defendants that could support a claim for breach of the implied covenant and has not shown “in what manner [she] can amend [the] complaint [or] how that amendment will change the legal effect of [the] pleading.” (Goodman v. Kennedy, supra, 18 Cal.3d at p. 349.) Accordingly, the trial court properly sustained the demurrers to the cause of action for breach of the implied covenant without leave to amend.

3. Enamorado Has Stated Causes of Action for Fraud and Fraudulent Concealment Except as to Her Concealment Claim Against Mendez

a. Res judicata does not bar Enamorado’s fraud claim against Pimentel, Sr.

California law defines a “cause of action” for purposes of the res judicata doctrine by analyzing the primary right at stake: “[A] ‘cause of action’ is comprised of a ‘primary right’ of the plaintiff, a corresponding ‘primary duty’ of the defendant, and a wrongful act by the defendant constituting a breach of that duty. [Citation.] The most salient characteristic of a primary right is that it is indivisible: the violation of a single primary right gives rise to but a single cause of action. [Citation.] A pleading that states the violation of one primary right in two causes of action contravenes the rule against ‘splitting’ a cause of action. [Citation.]” (Crowley v. Katleman (1994) 8 Cal.4th 666, 681.) “‘[I]f two actions involve the same injury to the plaintiff and the same wrong by the defendant then the same primary right is at stake even if in the second suit the plaintiff pleads different theories of recovery, seeks different forms of relief and/or adds new facts supporting recovery. [Citations.]’” (Tensor Group v. City of Glendale (1993) 14 Cal.App.4th 154, 160.) “On the other hand, different primary rights may be violated by the same wrongful conduct.” (Branson v. Sun-Diamond Growers (1994) 24 Cal.App.4th 327, 342; see, e.g., Agarwal v. Johnson (1979) 25 Cal.3d 932, 954; Brenelli Amedeo, S.P.A. v. Bakara Furniture, Inc. (1994) 29 Cal.App.4th 1828; Sawyer v. First City Financial. Corp. (1981) 124 Cal.App.3d 390, 399-403.)

In Sawyer v. First City Financial Corp., supra, 124 Cal.App.3d 390, vendors brought suit against purchasers and lien holders for breach of contract on a note, deed of trust and loan and development agreement. After entry of a final judgment in favor of the defendants, the vendors sued in tort for an alleged conspiracy among the defendants to conduct a sham foreclosure sale. The Court of Appeal held the two actions involved distinct primary rights: “[O]ne’s breach of contract by failing to pay a note violates a ‘primary right’ which is separate from the ‘primary right’ not to have the note stolen.” (Id. at p. 402.) “While the monetary loss may be measurable by the same promissory note amount, and hence in a general sense the same ‘harm’ has been done in both cases, theoretically the plaintiffs have been ‘harmed’ differently by tortious conduct destroying the value of the note, than by the contractual breach of simply failing to pay it. We conclude, therefore, Sawyer II is based upon a separate and severable cause of action from that litigated in Sawyer I . . . .” (Id. at p. 403; see Brenelli Amedeo, S.P.A. v. Bakara Furniture, Inc., supra, 29 Cal.App.4th at p. 1837 [“the right to have contractual obligations performed is distinct from the right to be free from tortious behavior preventing collection of a judgment”].)

Enamorado’s contract and fraud claims against Pimentel, Sr. are analogous to the situations presented in Sawyer v. First City Financial Corp., supra, 124 Cal.App.3d 390, and Brenelli Amedeo, S.P.A. v. Bakara Furniture, Inc., supra, 29 Cal.App.4th 1828 for purposes of a primary rights analysis. The small claims action was for breach of contract based on Pimentel, Sr.’s failure to comply with the parties’ oral agreement. Enamorado’s fraud claim, although largely involving the same wrongful conduct, nonetheless seeks to vindicate Enamorado’s right to be free from tortious conduct that allegedly destroyed not only the value of her agreement with Pimentel, Sr. but also her rights to continued possession of the town house on which she had made both a down payment and monthly financing payments. At the very least, because the case is only at the pleading stage, we cannot conclude as a matter of law that Enamorado has impermissibly split a single cause of action into two parts. (See Agarwal v. Johnson, supra, 25 Cal.3d at p. 954 [“Unless the requisite identity of causes of action is established . . . the first judgment will not operate as a bar.”].)

b. The first amended complaint pleads Pimentel, Sr.’s fraud with sufficient specificity

“In California, fraud must be pled specifically; general and conclusory allegations do not suffice. [Citations.] ‘Thus “‘the policy of liberal construction of the pleadings . . . will not ordinarily be invoked to sustain a pleading defective in any material respect.’” [Citation.]

This particularity requirement necessitates pleading facts which “show how, when, where, to whom, and by what means the representations were tendered.”’ [Citation.]” (Lazar v. Superior Court (1996) 12 Cal.4th 631, 645.) The elements of a fraud claim are (1) a misrepresentation, (2) knowledge of its falsity, (3) intent to defraud, (4) justifiable reliance and (5) resulting damages. (Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 991.)

The first amended complaint alleged that “[a]n oral agreement was made with Defendant Pimentel Sr. . . . to purchase the subject property . . . [and] convey the property to Plaintiff, for the sum of $5,000.00 payable to Pimentel, Sr.” However, “[u]nknown to Plaintiff, Pimentel Sr. actually intended to have his son, Pimentel Jr., become the borrower and nominal purchaser. [Thus], at the time Pimentel Sr. entered into the agreement, he had no intent to perform as agreed.” “The intent not to perform by Pimentel Sr. was unknown to Plaintiff.” “As a result of [Pimentel, Sr.]’s fraud, Plaintiff has been damaged by an unascertained amount.” These specific factual allegations adequately plead each element necessary for Enamorado’s fraud claim (promise made without intent to perform) against Pimentel, Sr. (See O’Mary v. Mitsubishi Electronics America, Inc. (1997) 59 Cal.App.4th 563, 579 [“‘”[I]n order to support a claim of fraud based upon the alleged failure to perform a promise, it must be shown that the promisor did not intend to perform at the time the promise was made.’” [Citations.]”].)[6]

c. Enamorado’s allegations of civil conspiracy are sufficient to permit her to proceed with her misrepresentation claims against the other defendants

Enamorado’s first amended complaint alleged that, commencing in mid-August 2003, Pimentel, Sr., Vallarta, Reyes and Mendez participated in a civil conspiracy “to make fees from the sale and financing of the subject property by misrepresenting the identity of the true purchaser of the subject property [and] completing and submitting a false loan application to complete the transaction.” Enamorado further alleged “Pimentel, Jr. joined the conspiracy by submitting the offer to purchase and loan application [in] accordance with the instructions of Pimentel, Sr.,” and “Arreguin joined the conspiracy on August 6, 2004 when he obtained title to the subject property [from] Pimentel, Jr. and acted to evict [Enamorado] therefrom.”

The allegations that Pimentel, Jr., Vallarta, Reyes, Mendez and Arreguin joined with Pimentel, Sr. in a civil conspiracy to defraud Enamorado are sufficient to permit her to proceed with her fraud cause of action against each of them notwithstanding the absence of any specific allegations those other defendants personally misrepresented anything in connection with the purchase of the town house. (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510-511 [conspiracy is “a legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasors a common plan or design in its perpetration. [Citation.] By participation in a civil conspiracy, a coconspirator effectively adopts as his or her own the torts of other coconspirators within the ambit of the conspiracy. [Citation.] In this way, a coconspirator incurs tort liability co-equal with the immediate tortfeasors.”].) “‘”[T]he major significance of the conspiracy lies in the fact that it renders each participant in the wrongful act responsible as a joint tortfeasor for all damages ensuing from the wrong, irrespective of whether or not he was a direct actor and regardless of the degree of his activity.”’ [Citations.]” (Id. at p. 511.)

d. The first amended complaint places Arreguin’s status as a bona fide purchaser for value at issue

In sustaining his demurrer to the original complaint, the trial court ruled Arreguin was a bona fide purchaser for value and could not be liable for fraud as a matter of law.[7] In her first amended complaint Enamorado substantially expanded her allegations regarding Arreguin and specifically alleged, “Arreguin is not a bona fide purchaser in that (a) no or inadequate consideration was paid for the subject property; (b) the sale did not take place in any reasonable manner, such as through an escrow or with title insurance; (c) the sale does not include any financing and the existing financing contains due on sale provisions; and (d) the property was occupied at the time of transfer and no contract [sic?] was made with the occupant (Plaintiff).”

In his demurrer to the first amended complaint, Arreguin argued the grant deed from Pimentel, Jr., which was the subject of judicial notice by the court, reflected that he had paid valuable consideration for the property and Enamorado had failed to record any document that would have placed a subsequent purchaser on notice she claimed an interest in the real property. Whether or not those facts if proved by competent evidence, will be sufficient for a successful motion for summary judgment, they are simply inadequate to sustain a demurrer to the first amended complaint on the ground Arreguin is a bona fide purchaser for value. Enamorado has alleged Arreguin gave “no or inadequate consideration” in payment for the property. Under the rule mandating a liberal construction of pleadings (§ 452; see Buxbom v. Smith (1944) 23 Cal.2d 535, 542), that allegation is sufficient to put Arreguin’s status as a bona fide purchaser for value at issue. Moreover, although Enamorado did not record any interest in the property (and, indeed, may have possessed no recordable interest), her allegations that she was occupying the property at the time of transfer and Arreguin failed to contact her also places his status as a bona fide purchaser for value at issue. (Oakdale Village Group v. Fong (1996) 43 Cal.App.4th 539, 547 [“[A]bsence of notice is an essential requirement in order that one may be regarded as a bona fide purchaser.”].)

e. The trial court should have overruled the demurrer to the claims for fraudulent concealment against Vallarta and Reyes

“[T]he elements of an action for . . . concealment are: (1) the defendant must have concealed or suppressed a material fact, (2) the defendant must have been under a duty to disclose the fact to the plaintiff, (3) the defendant must have intentionally concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the plaintiff must have been unaware of the fact and would not have acted as [s]he did if [s]he had known of the concealed or suppressed fact, and (5) as a result of the concealment or suppression of the fact, the plaintiff must have sustained damage.” (Weiner v. Fleischman (1991) 54 Cal.3d 476, 481, fn. 1; Marketing West, Inc. v. Sanyo Fisher (USA) Corp. (1992) 6 Cal.App.4th 603, 612-613.)

In sustaining the demurrer to this cause of action, the trial court ruled Enamorado had not adequately pleaded either the source of defendants’ duty to disclose or their intentional concealment with an intent to defraud her. Neither conclusion is correct with respect to Enamorado’s claim against Vallarta and Reyes.[8]

Enamorado specifically alleged Vallarta and Reyes owed her a duty to disclose material facts because they were her real estate agents “in her attempt to purchase the subject property.” That allegation, supporting the existence of a real estate broker/purchaser relationship, is sufficient to establish that Vallarta and Reyes owed Enamorado a fiduciary duty to disclose material facts. (See Civ. Code, § 2079.16; Brown v. FSR Brokerage, Inc. (1998) 62 Cal.App.4th 766, 775; Leko v. Cornerstone Bldg. Inspection Service (2001) 86 Cal.App.4th 1109, 1116.)

With respect to the Vallarta and Reyes’s tortious intent, Enamorado alleged, “Defendants were aware of all these facts, and more, and aware of their obligation to disclose them . . . [but] intentionally concealed these facts . . . with the intent that Plaintiff be defrauded into the purchase of the subject property.

. . . Plaintiff, unaware of the concealment, acted as alleged . . . [but] would not have purchase [sic] the subject property” if she was aware of the true facts. Although general in nature, these allegations are adequate to support the concealment claim against Vallarta and Reyes.

f. The trial court properly sustained the demurrer to the fraudulent concealment claim against Mendez but should have granted leave to amend

The trial court’s finding Enamorado has not adequately pleaded the element of duty for her fraudulent concealment claim against Mendez is correct, and his demurrer to the concealment cause of action was properly sustained. Enamorado has alleged only that Mendez “owed a duty to [her] because of the position of trust which he held with respect to her and his knowledge that [she] was relying on him for advise [sic], information, protection and assistance.” That allegation merely states that Enamorado trusted and relied upon Mendez, not that any fiduciary or other confidential relationship existed between them that would give rise to a duty to disclose material facts regarding the purchase of the Panorama City town house.

Enamorado has requested leave to amend her first amended complaint to the extent her factual allegations are too general. We believe, if given the opportunity, it is reasonably possible Enamorado can include additional details in an amended pleading regarding her relationship with Mendez and the functions he agreed to perform for her that will support the existence of a fiduciary relationship and the concomitant duty to disclose material facts regarding the purchase transaction. (See Schifando v. City of Los Angeles, supra, 31 Cal.4th at p. 1081.) Accordingly, on remand further amendment on this point should be permitted by the trial court.

4. Enamorado Has Stated a Cause of Action for Intentional Infliction of Emotional Distress

“The elements of a prima facie case of intentional infliction of emotional distress consist of: (1) extreme and outrageous conduct by the defendant with the intent to cause, or reckless disregard for the probability of causing, emotional distress; (2) suffering of severe or extreme emotional distress by the plaintiff; and (3) the plaintiff's emotional distress is actually and proximately the result of defendant’s outrageous conduct.” (Conley v. Roman Catholic Archbishop (2002) 85 Cal.App.4th 1126, 1133.) Extreme and outrageous conduct is behavior “‘so extreme as to exceed all bounds of that usually tolerated in a civilized community.’” (Potter v. Firestone Tire & Rubber Co. (1993) 6 Cal.4th 965, 1001.) “‘”[I]t is for the court to determine, in the first instance, whether the defendant’s conduct may reasonably be regarded as so extreme and outrageous as to permit recovery.”’ [Citations.]” (Fowler v. Varian Associates, Inc. (1987) 196 Cal.App.3d 34, 44.)

The first amended complaint alleged Pimentel, Sr., Vallarta, Reyes and Mendez jointly participated in a plan to misrepresent to Enamorado the purpose and nature of the “straw purchase” of the Panorama City town house in order to generate fees and commissions. Thereafter, joined by Pimentel, Jr. and Arreguin, they attempted to extract even more money from Enamorado by withholding the deed to the property and threatening to evict her and her family from the property. Enamorado further alleged the defendants “knew and expected that [Enamorado] would suffer severe emotional distress due to the anticipated loss of her home and intended to use that emotional distress to force [Enamorado] to give in to their demands.”

Allegations the defendants defrauded Enamorado of her life savings causing her “great financial and emotional distress,” standing alone, may be insufficient to state a cause of action for intentional infliction of emotional distress. But the use of threats (eventually carried out) to evict Enamorado and her family and to leave them homeless as part of an effort to reap improper financial gain, at least at the pleading stage, constitutes a sufficient allegation of outrageous conduct to permit Enamorado to proceed with her claim. (Alcorn v. Anbro Engineering, Inc. (1970) 2 Cal.3d 493, 499 [“‘Where reasonable [people] may differ, it is for the [fact finder] . . . to determine whether, in the particular case, the conduct has been sufficiently extreme and outrageous to result in liability.’”].)

Similarly, Enamorado has adequately pleaded that Pimentel, Sr., Pimentel, Jr. and Arreguin, together with their coconspirators, intended to cause her severe emotional distress; indeed, she has alleged that creating not only financial pressure but also emotional distress was an essential element of the plan to coerce additional money from her. Finally, Enamorado alleged, albeit in general terms, that she suffered severe emotional distress as a result of defendants’ outrageous conduct and that each additional demand for money and the threat of eviction “increase[ed] the distress suffered.” As a technical matter, those allegations may be too broad. (See, e.g., Bogard v. Employers Casualty Co. (1985) 164 Cal.App.3d 602, 617 [allegation of “severe emotional distress” insufficient absent allegations concerning nature or extent of mental suffering caused by defendants’ alleged outrageous conduct]; Angie M. v. Superior Court (1995) 37 Cal.App.4th 1217, 1227 [describing emotional distress as “severe” insufficient without additional factual allegations detailing nature of distress suffered].) But that deficiency, easily rectified by requiring Enamorado to respond to a properly drafted interrogatory, was neither argued by the defendants nor identified by the trial court as a ground for sustaining the demurrer to this cause of action;[9] and we decline to consider it sua sponte on appeal. (See Kim v. Sumitomo Bank (1993) 17 Cal.App.4th 974, 979 [although review on appeal from summary judgment is de novo, it is not the appellate court’s function to address arguments not raised on appeal]; Lopez v. Baca (2002) 98 Cal.App.4th 1008, 1016 & fn. 5 [same].)

Disposition

The order dismissing the action is reversed. On remand the trial court is directed to vacate its order sustaining the demurrers as to all causes of action without leave to amend and to enter a new order sustaining the demurrers to the causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing without leave to amend and overruling the demurrers to the causes of action for fraud, fraudulent concealment and intentional infliction of emotional distress except as to Mendez, whose demurrer to the cause of action for fraudulent concealment only is to be sustained with leave to amend.

Enamorado is to recover her costs on appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

PERLUSS, P. J.

We concur:

JOHNSON, J. ZELON, J.

Publication courtesy of San Diego pro bono legal advice.

Analysis and review provided by Poway Property line Lawyers.

[1] We accept as true all facts properly pleaded in the first amended complaint to determine whether the demurrer should be overruled. (Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 373; Casterson v. Superior Court (2002) 101 Cal.App.4th 177, 182-183 [“The reviewing court accepts as true all facts properly pleaded in the complaint in order to determine whether the demurrer should be overruled.”]; see Mack v. Soung (2000) 80 Cal.App.4th 966, 971 [all properly pleaded allegations deemed true, regardless of plaintiff’s ability to later prove them].)

[2] Pimentel, Sr. and Pimentel, Jr. both answered the original complaint.

[3] In sustaining the original demurrers, in part, with leave to amend, the trial court ordered Enamorado to file her first amended complaint within 10 days. Enamorado failed to comply with the court’s order, filing her first amended complaint more than 30 days after the hearing on the demurrers. Nonetheless, the trial court denied defendants’ motion to dismiss the action on that basis.

[4] Statutory references are to the Code of Civil Procedure unless otherwise indicated.

[5] It is not clear why Enamorado sought only $2,600 in the small claims action since she has pleaded she paid Pimentel, Sr. $3,700 (his full $5,000 service fee less the $1,300 final check on which she stopped payment after Pimentel, Jr. allegedly demanded more money) and also made a $4,000 down payment on the town house.

[6] Pointing to Enamorado’s small claims court action and her petition for a civil harassment restraining order, defendants noted in the trial court that Enamorado has been somewhat inconsistent as to the date on which she allegedly entered into her oral agreement with Pimentel, Sr. Although the trial court in ruling on a demurrer may disregard allegations that contradict those contained in prior pleadings unless adequately explained (e.g., Vallejo Development Co. v. Beck Development Co. (1994) 24 Cal.App.4th 929, 946; see Reichert v. General Ins. Co. (1968) 68 Cal.2d 822, 836), we fail to see the legal significance of the exact date of the parties’ agreement for purposes of Enamorado’s fraud and other tort claims.

[7] To be a bona fide purchaser, Arreguin must have made the purchase of the property for value, in good faith and without actual or constructive notice of another person’s rights to the property. (Oakdale Village Group v. Fong (1996) 43 Cal.App.4th 539, 547.)

[8] There is no question Enamorado pleaded Vallarta and Reyes failed to disclose to her numerous material facts, including the risk that Pimentel, Sr. or Pimentel, Jr. would transfer or refinance the property without Enamorado’s knowledge or consent; the fact that the scheme necessarily involved misrepresentations made to the lender and could violate various state and federal laws; and the risk that, even if the Pimentels complied with the contract, upon transfer of the property the lenders would accelerate the loans pursuant to due-on-sale clauses.

[9] The defendants argued only Enamorado had failed to adequately allege either that they had engaged in unprivileged conduct that was sufficiently extreme and outrageous to be actionable or that their conduct caused Enamorado to suffer emotional distress -- the grounds identified by the trial court in sustaining the demurrer to the cause of action for intentional infliction of emotional distress as pleaded in Enamorado’s original complaint. The trial court sustained the demurrer to this cause of action in the first amended complaint “for the reasons set forth in the moving papers.”