1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 JOSHUA GOENS, an individual, Case No.: 19-CV-02299 W (KSC)
14 Plaintiff, ORDER GRANTING DEFENDANTS’ 15 v. MOTION TO EXPUNGE LIS PENDENS AND FOR AWARD OF 16 VICTORIA BLOOD et al., ATTORNEY’S FEES AND COSTS 17 Defendants. [DOC. 13] 18 19 20 Pending before this Court is a motion to expunge a lis pendens and for an award of 21 attorney’s fees and costs filed by Defendants Victoria L. Blood and Vondell M. Forrester, 22 each individually and as co-trustees of The Nathan A. Blood 1992 Trust. Plaintiff Joshua 23 Goens opposes. 24 The Court finds the matter is appropriate for decision on the papers submitted and 25 without oral argument. See Civ.L.R. 7.1d1. For the following reasons, the Court 26 GRANTS Defendant’s motion to expunge Lis Pendens #1 and Lis Pendens #2 [Doc. 13] 27 and AWARDS attorney’s fees in the amount of $3,300. 28 1 I. INTRODUCTION 2 On June 1, 2018, Plaintiff Joshua Goens entered into a lease agreement for 3 commercial property located at 5909 Mission Gorge Road in San Diego, California. 4 (FAC [Doc. 3] ¶ 11.) The property, along with 5901 and 5913 Mission Gorge Road, are 5 owned by Defendants Victoria L. Blood and Vondell M. Forrester, as co-trustees of The 6 Nathan A. Blood 1992 Trust (the “Trust”). (Id. ¶¶ 8, 13.) 7 In January 2019, Goens raised concerns with the Trust about the dilapidated 8 condition of the property. (FAC ¶¶ 15, 16.) Specifically, Goens raised issues about 9 “unsafe working conditions, mold remediation, and interior and exterior dilapidation.” 10 (Id. ¶ 17.) Goens spent “a great amount of time, energy and effort” remedying the 11 problems. (Id. ¶ 18.) And in the months that followed, Defendants elicited his help 12 evicting the previous master lessor who had caused problems at the property. (Id. ¶ 20.) 13 Defendants also began talking to and treating Goens as if he were the property manager 14 of 5901, 5909 and 5913 Mission Gorge Road (collectively referred to as, the “Subject 15 Property”). (Id. ¶¶ 21–24.) 16 On June 1, 2019, Goens and Defendants entered a second Commercial Lease 17 Agreement for 5909 (“Lease #1”) for a term of two years. (FAC ¶¶ 25, 26.) Goens 18 contends that before entering the agreement, the parties had many discussions regarding 19 the property. (Id. ¶ 27.) According to Goens, there was also “a mutual oral agreement 20 that [Goens] would be the master lessor of the Subject Property, and in time, obtain the 21 lease to all three properties owned by Defendant: 5901, 5909, and 5913 Mission Gorge 22 Road, San Diego, California, 92120.” (Id. ¶ 28.) Additionally, before entering Lease #1, 23 Defendants informed Goens that the “Subject Property was listed for sale, but expressly 24 stated that ‘it would not be sold, because it had been on and off the market for the past 25 five years” and that “the sale of the property ‘would not interfere with [Plaintiff’s] lease 26 term.’” (Id. ¶¶ 29, 30.) 27 On August 1, 2019, Goens and Defendants entered a Commercial Lease 28 Agreement for 5901 Mission Gorge Road (“Lease #2”). (FAC ¶ 36.) Although the 1 parties never entered a lease for 5913 Mission Gorge Road, Goens acted as the property 2 manager for the entire Subject Property. (Id. ¶¶ 37, 38.) 3 In approximately September 26, 2019, Goens became aware of a potential buyer 4 for the Subject Property. (FAC ¶ 39.) Goens’ attorney contacted Defendants’ attorney to 5 discuss “various issues at the Subject Property, including but not limited to, Defendants’ 6 representations regarding the sale of the Subject Property and potential settlement of any 7 claims.” (Id. 40.) Discussions were unsuccessful, and on November 1, 2019, Goens 8 received a 60-day Notice to Quit for 5909 Mission Gorge Road. (Id. ¶¶ 41, 42.) 9 On December 3, 2019, Goens filed this lawsuit. (See Compl. [Doc. 1].) The FAC 10 alleges sixteen causes of action: (1) breach of the implied covenant of good faith and fair 11 dealing; (2) negligent misrepresentation; (3) intentional misrepresentation; (4) promissory 12 estoppel; (5) unjust enrichment; (6) unfair business practices; (7) failure to pay minimum 13 wage; (8) failure to reimburse business expenses; (9) intentional interference with 14 contractual relations; (10) intentional interference with prospective economic relations; 15 (11) defamation – slander per se; (12) defamation – slander per quod; (13) intentional 16 infliction of emotional distress; (14) injunctive relief; (15) injunctive relief; and (16) 17 reformation. (See FAC.) Causes of action one through thirteen seek monetary damages. 18 (Id.) The fourteenth cause of action appears to seek an injunction preventing Defendants 19 from breaching Lease #1 and Lease #2. (Id. ¶¶ 181–186.) The fifteenth cause of action 20 seeks an injunction preventing Goens from losing possession of the Subject Property, and 21 the sixteenth cause of action seeks reformation of Lease #1 and Lease #2 to conform to 22 “the representations made by Defendants, stating that the Subject Property will not be 23 sold during Plaintiff’s term of lease.” (Id. ¶¶ 187–204.) 24 On December 13, 2019, Goens recorded a Notice of Pendency of Action, 25 Document Number 2019-0582227 of the Official Records of San Diego County (“Lis 26 Pendens #1), and on December 18, 2019, Goens recorded a second Notice of Pendency of 27 Action, Document Number 2019-0592937 of the Official Records of San Diego County 28 for the Subject Property (“Lis Pendens #2”). Defendants now move to expunge the lis 1 pendens under California Code of Civil Procedure §§ 405.31 and §405.32, and for 2 payment of attorneys’ fees related to the motion. Goens opposes the motion. 3 4 II. STANDARD 5 California Code of Civil Procedure § 405.20 provides that a “party to an action 6 who asserts a real property claim may record a notice of pendency of action, in which the 7 real property claim is alleged.” A “‘[r]eal property claim’ means the cause or causes of 8 action in a pleading, which would, if meritorious, affect (a) title to, or the right to 9 possession of, specific real property....” Code Civ. Proc. § 405.4. 10 A party seeking to expunge a lis pendens may move under Code of Civil Procedure 11 § 405.31 or § 405.32. Under section 405.31, “the court shall order the notice expunged if 12 the court finds that the pleading on which the notice is based does not contain a real 13 property claim.” The analysis under this section is “analogous to, but more limited than, 14 the analysis undertaken by a court on a demurrer. Rather than analyzing whether the 15 pleading states any claim at all, as on a general demurrer, the court must undertake the 16 more limited analysis of whether the pleading states a real property claim.” BGJ 17 Associates, LLC v. Superior Court, 75 Cal. App. 4th 952, 956 (1999) (quoting comments 18 in Deering’s and West’s Annotated California Codes (hereinafter “Comment”) to § 19 405.31). 20 Section 405.32 in contrast provides that “the court shall order the notice be 21 expunged if the court finds that the claimant has not established by a preponderance of 22 the evidence the probable validity of the real property claim.” Under this section, 23 evidence is used to determine “the probability the proponent will be able to establish a 24 valid real property claim.” BGJ Associates, LLC, 75 Cal.App.4th at 956–957 (quoting 25 Comment to 405.32). “Probable validity” of a claim means that it is more likely than not 26 27 28 1 that the claimant will obtain a judgment against the Defendant on the claim. Code Civ. 2 Proc. 405.3. 3 4 III. ANALYSIS 5 A. Under existing California law, Goens is not entitled to maintain the lis 6 pendens. 7 Goens contends the FAC alleges a real property claim because a “leasehold is an 8 estate in real property and falls within the purview of an action concerning real property 9 or affecting the title to, or the right of possession over the real property.” (Opp’n [Doc.
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1 2 3 4 5 6 7 8 9 10 UNITED STATES DISTRICT COURT 11 SOUTHERN DISTRICT OF CALIFORNIA 12 13 JOSHUA GOENS, an individual, Case No.: 19-CV-02299 W (KSC)
14 Plaintiff, ORDER GRANTING DEFENDANTS’ 15 v. MOTION TO EXPUNGE LIS PENDENS AND FOR AWARD OF 16 VICTORIA BLOOD et al., ATTORNEY’S FEES AND COSTS 17 Defendants. [DOC. 13] 18 19 20 Pending before this Court is a motion to expunge a lis pendens and for an award of 21 attorney’s fees and costs filed by Defendants Victoria L. Blood and Vondell M. Forrester, 22 each individually and as co-trustees of The Nathan A. Blood 1992 Trust. Plaintiff Joshua 23 Goens opposes. 24 The Court finds the matter is appropriate for decision on the papers submitted and 25 without oral argument. See Civ.L.R. 7.1d1. For the following reasons, the Court 26 GRANTS Defendant’s motion to expunge Lis Pendens #1 and Lis Pendens #2 [Doc. 13] 27 and AWARDS attorney’s fees in the amount of $3,300. 28 1 I. INTRODUCTION 2 On June 1, 2018, Plaintiff Joshua Goens entered into a lease agreement for 3 commercial property located at 5909 Mission Gorge Road in San Diego, California. 4 (FAC [Doc. 3] ¶ 11.) The property, along with 5901 and 5913 Mission Gorge Road, are 5 owned by Defendants Victoria L. Blood and Vondell M. Forrester, as co-trustees of The 6 Nathan A. Blood 1992 Trust (the “Trust”). (Id. ¶¶ 8, 13.) 7 In January 2019, Goens raised concerns with the Trust about the dilapidated 8 condition of the property. (FAC ¶¶ 15, 16.) Specifically, Goens raised issues about 9 “unsafe working conditions, mold remediation, and interior and exterior dilapidation.” 10 (Id. ¶ 17.) Goens spent “a great amount of time, energy and effort” remedying the 11 problems. (Id. ¶ 18.) And in the months that followed, Defendants elicited his help 12 evicting the previous master lessor who had caused problems at the property. (Id. ¶ 20.) 13 Defendants also began talking to and treating Goens as if he were the property manager 14 of 5901, 5909 and 5913 Mission Gorge Road (collectively referred to as, the “Subject 15 Property”). (Id. ¶¶ 21–24.) 16 On June 1, 2019, Goens and Defendants entered a second Commercial Lease 17 Agreement for 5909 (“Lease #1”) for a term of two years. (FAC ¶¶ 25, 26.) Goens 18 contends that before entering the agreement, the parties had many discussions regarding 19 the property. (Id. ¶ 27.) According to Goens, there was also “a mutual oral agreement 20 that [Goens] would be the master lessor of the Subject Property, and in time, obtain the 21 lease to all three properties owned by Defendant: 5901, 5909, and 5913 Mission Gorge 22 Road, San Diego, California, 92120.” (Id. ¶ 28.) Additionally, before entering Lease #1, 23 Defendants informed Goens that the “Subject Property was listed for sale, but expressly 24 stated that ‘it would not be sold, because it had been on and off the market for the past 25 five years” and that “the sale of the property ‘would not interfere with [Plaintiff’s] lease 26 term.’” (Id. ¶¶ 29, 30.) 27 On August 1, 2019, Goens and Defendants entered a Commercial Lease 28 Agreement for 5901 Mission Gorge Road (“Lease #2”). (FAC ¶ 36.) Although the 1 parties never entered a lease for 5913 Mission Gorge Road, Goens acted as the property 2 manager for the entire Subject Property. (Id. ¶¶ 37, 38.) 3 In approximately September 26, 2019, Goens became aware of a potential buyer 4 for the Subject Property. (FAC ¶ 39.) Goens’ attorney contacted Defendants’ attorney to 5 discuss “various issues at the Subject Property, including but not limited to, Defendants’ 6 representations regarding the sale of the Subject Property and potential settlement of any 7 claims.” (Id. 40.) Discussions were unsuccessful, and on November 1, 2019, Goens 8 received a 60-day Notice to Quit for 5909 Mission Gorge Road. (Id. ¶¶ 41, 42.) 9 On December 3, 2019, Goens filed this lawsuit. (See Compl. [Doc. 1].) The FAC 10 alleges sixteen causes of action: (1) breach of the implied covenant of good faith and fair 11 dealing; (2) negligent misrepresentation; (3) intentional misrepresentation; (4) promissory 12 estoppel; (5) unjust enrichment; (6) unfair business practices; (7) failure to pay minimum 13 wage; (8) failure to reimburse business expenses; (9) intentional interference with 14 contractual relations; (10) intentional interference with prospective economic relations; 15 (11) defamation – slander per se; (12) defamation – slander per quod; (13) intentional 16 infliction of emotional distress; (14) injunctive relief; (15) injunctive relief; and (16) 17 reformation. (See FAC.) Causes of action one through thirteen seek monetary damages. 18 (Id.) The fourteenth cause of action appears to seek an injunction preventing Defendants 19 from breaching Lease #1 and Lease #2. (Id. ¶¶ 181–186.) The fifteenth cause of action 20 seeks an injunction preventing Goens from losing possession of the Subject Property, and 21 the sixteenth cause of action seeks reformation of Lease #1 and Lease #2 to conform to 22 “the representations made by Defendants, stating that the Subject Property will not be 23 sold during Plaintiff’s term of lease.” (Id. ¶¶ 187–204.) 24 On December 13, 2019, Goens recorded a Notice of Pendency of Action, 25 Document Number 2019-0582227 of the Official Records of San Diego County (“Lis 26 Pendens #1), and on December 18, 2019, Goens recorded a second Notice of Pendency of 27 Action, Document Number 2019-0592937 of the Official Records of San Diego County 28 for the Subject Property (“Lis Pendens #2”). Defendants now move to expunge the lis 1 pendens under California Code of Civil Procedure §§ 405.31 and §405.32, and for 2 payment of attorneys’ fees related to the motion. Goens opposes the motion. 3 4 II. STANDARD 5 California Code of Civil Procedure § 405.20 provides that a “party to an action 6 who asserts a real property claim may record a notice of pendency of action, in which the 7 real property claim is alleged.” A “‘[r]eal property claim’ means the cause or causes of 8 action in a pleading, which would, if meritorious, affect (a) title to, or the right to 9 possession of, specific real property....” Code Civ. Proc. § 405.4. 10 A party seeking to expunge a lis pendens may move under Code of Civil Procedure 11 § 405.31 or § 405.32. Under section 405.31, “the court shall order the notice expunged if 12 the court finds that the pleading on which the notice is based does not contain a real 13 property claim.” The analysis under this section is “analogous to, but more limited than, 14 the analysis undertaken by a court on a demurrer. Rather than analyzing whether the 15 pleading states any claim at all, as on a general demurrer, the court must undertake the 16 more limited analysis of whether the pleading states a real property claim.” BGJ 17 Associates, LLC v. Superior Court, 75 Cal. App. 4th 952, 956 (1999) (quoting comments 18 in Deering’s and West’s Annotated California Codes (hereinafter “Comment”) to § 19 405.31). 20 Section 405.32 in contrast provides that “the court shall order the notice be 21 expunged if the court finds that the claimant has not established by a preponderance of 22 the evidence the probable validity of the real property claim.” Under this section, 23 evidence is used to determine “the probability the proponent will be able to establish a 24 valid real property claim.” BGJ Associates, LLC, 75 Cal.App.4th at 956–957 (quoting 25 Comment to 405.32). “Probable validity” of a claim means that it is more likely than not 26 27 28 1 that the claimant will obtain a judgment against the Defendant on the claim. Code Civ. 2 Proc. 405.3. 3 4 III. ANALYSIS 5 A. Under existing California law, Goens is not entitled to maintain the lis 6 pendens. 7 Goens contends the FAC alleges a real property claim because a “leasehold is an 8 estate in real property and falls within the purview of an action concerning real property 9 or affecting the title to, or the right of possession over the real property.” (Opp’n [Doc. 10 20] 6:6–11.) Defendants disagree because most of the sixteen causes of action in the 11 FAC seek monetary damages. (P&A [Doc. 13] 8:25–12:11.) 12 Under existing California case law, whether Goens has alleged a real property 13 claim for purposes of section 405.20 is a close call. In Parker v. Superior Court, 9 14 Cal.App.3d 397 (1970), the court held that a leasehold is an estate in real property and 15 “under the broad language of” the lis pendens statute, “an action concerning … the right 16 of possession of real property….” Id. at 400 (italics in original). Because two of Goens’ 17 causes of action seek possession of real property under a leasehold interest, Parker 18 supports a finding that Goens has pled a real property claim. 19 What complicates the issue is the more recent California Court of Appeal decision, 20 BGJ Associates, LLC v. Superior Court, 75 Cal.App.4th 952 (1999), which limited the 21 availability of a lis pendens. There, plaintiffs Robert Goldman and Jerome Janger agreed 22 to form a joint venture with defendant Maynard Brittan to purchase certain real property. 23 When plaintiffs expressed hesitation about the purchase, Brittan and defendant Jeff 24 Wilson purchased the property. Plaintiffs then filed a complaint alleging eleven causes of 25 action. Nine of the causes of action sought monetary damages. The last two causes of 26 action sought the imposition of a constructive trust, and an order compelling defendants 27 to convey to plaintiffs “‘their interest in Parcel 1,’ and ‘an order granting [plaintiffs] 28 1 possession of Parcel 1.’” Id. at 965–66. Plaintiffs then filed a notice of lis pendens, and 2 defendants moved to expunge the lis pendens. 3 The Court of Appeal began its analysis by discussing the history of the lis pendens 4 statute: 5 The history of the lis pendens legislation shows a legislative intent to restrict the common law notion of constructive notice [that an action has been filed 6 affecting title or right to possession of the real property]. This is because of 7 the ease with which a lis pendens can be recorded and the serious consequences flowing from it. Once a lis pendens is filed, it clouds the title 8 and effectively prevents the property’s transfer until the litigation is resolved 9 or the lis pendens is expunged. Accordingly, a lis pendens is a provisional remedy which should be applied narrowly. 10
11 Id. at 966–67. The court also explained that because of the consequences flowing from a 12 lis pendens, other California cases have “long recognized that … ‘the lis pendens 13 procedure [is] susceptible to serious abuse, providing unscrupulous plaintiffs with a 14 powerful lever to force the settlement of groundless or malicious suits.’” Id. at 969 15 (brackets in original). Previous case law, therefore, declared that “lis pendens is not 16 available in what ‘is essentially a fraud action seeking money damages with additional 17 allegations urged to support the equitable remedies of a constructive trust or an equitable 18 lien.” Id. at 970. Accordingly, in determining whether claims in the pleading affect title 19 to or possession of specific real property, “courts have looked to the substance of the 20 dispute to determine whether it is ‘essentially’ a fraud action seeking money damages, 21 with constructive trust allegations ‘appended.’” Id. at 971–72. Based on these principles, 22 the court stated that “where the pleading combines theories of liability for monetary 23 damages and for a constructive trust, we hold that plaintiffs should not be able to 24 maintain a lis pendens. The danger is too great that a lis pendens, which effectively 25 renders the property unmarketable, will have the coercive effects condemned by cases.” 26 Id. at 972 27 This case is more analogous to BGJ Associates because the vast majority of 28 Goens’ causes of action seek monetary damages; only two of the sixteen seek possession 1 of the Subject Property. Moreover, the BGJ Associates plaintiffs had a more significant 2 property interest than Goens, because they sought title and not simply temporary 3 possession. Yet the California Court of Appeal refused to find plaintiffs’ interest in title 4 sufficiently “affected” the property to constitute a real property claim under the lis 5 pendens statute. Because Goens’ interest in temporary possession of the Subject Property 6 is less compelling than an interest in title, BGJ Associates supports the conclusion that 7 Goens failed to sufficiently allege a real property claim under section 405.4. 8 9 B. Goens has failed to establish the probability of success on his causes of 10 action for injunctive relief and reformation. 11 Under section 405.32, the lis pendens must be expunged unless Goens establishes 12 “by a preponderance of the evidence the probable validity of [his] real property claim.” 13 Goens’ real property claim is based on his causes of action seeking (1) injunctive 14 relief to prevent the sale of the Subject Property until the end of the terms of the 15 commercial lease agreements, and (2) reformation of the agreements due to Defendants’ 16 alleged fraudulent misrepresentations. (Opp’n 6:15–19.) In arguing the probable validity 17 of these causes of action, Goens relies exclusively on the contention that the FAC 18 adequately pleads fraudulent misrepresentation: 19 Plaintiff’s claim for injunctive relief and reformation of the lease agreement based on Defendants’ fraudulent misrepresentation is properly plead and 20 likely to obtain judgment. “A complaint for fraud must allege the following 21 elements: (1) a knowingly false representation by the defendant; (2) an intent to deceive or induce reliance; (2) justifiable reliance by the plaintiff; and (4) 22 resulting damages.” (Service by Medallion, Inc. v. Clorox Co., 44 23 Cal.App.4th 1807, 1816 (1996).) “In California, fraud must be pled specifically; general and conclusory allegations do not suffice.” (Lazar v. 24 Superior Court, 12 Cal. 4th 631, 645 (1996).) “The specificity required 25 when pleading a cause of action for fraud necessitates pleading facts which show how, when, where, to whom, and by what means the representations 26 were tendered.” (Id.) 27 28 1 (Id. 8:22–9:8.) Goens’ opposition then goes on to cite the supporting allegations in the 2 FAC. (Id. 9:9–16, citing FAC, ¶¶ 29, 30, 91.) These paragraphs allege that before 3 signing Lease #1, Defendants expressly stated that ‘[the property] would not be sold, 4 because it had been on and off the market for the past five years’” and that when the lease 5 agreement was signed, Defendants were aware the Subject Property was in the process of 6 being sold, yet represented to Goens that “he would retain rights to use the subject 7 property for the two (2) year term listed in the lease agreement signed on June 1, 2019.” 8 (FAC, ¶¶ 29, 30, 91.2) There are multiple problems with Goens’ argument. 9 First, Goens appears to misconstrue section 405.32’s requirement. The language 10 of the statute requires that he establish the probable validity of his claims by “a 11 preponderance of the evidence.” Code Civ. Proc § 504.32. Goens has failed to submit 12 any evidence supporting any of his claims. There is no evidence attached to his 13 opposition. And although the FAC purports to cite numerous exhibits, there are no 14 exhibits attached to the FAC. (See FAC.) 15 Goens’ failure to submit evidence is made even more problematic by Defendants’ 16 submission of evidence contradicting the fraudulent misrepresentation claims. 17 Specifically, the Addendum to Lease #1 explicitly notified Goens that 5909 Mission 18 Gorge Road was for sale and Goens agreed to cooperate with the sale of the property: 19 Lessee understands that Lessor has listed the Premises “For Sale.” Lessee agrees to cooperate with Lessor or Lessor’s broker for the purpose of 20 showing the Premises to Buyers. 21 (Blood Dec. [Doc. 13-6] ¶ 5, Ex. B [Doc. 13-9] p. 1.) Similar language notifying Goens 22 that 5901 Mission Gorge Road was for sale was also included in the Addendum to Lease 23 #2. (Blood Dec. ¶ 10, Ex. E [Doc. 13-12] p. 1.) These provisions directly contradict the 24 allegation that Defendants “expressly stated” the property would not be sold. The 25 Addendums to Lease #1 and Lease #2 also provide that the “Lessor… shall have the right 26 27 28 1 to terminate this Lease with sixty (60) days’ notice to Lessee.” (Ex. B ¶ 52, Ex. E. ¶ 52.) 2 This contradicts Goens’ allegation that, in essence, he was guaranteed to remain on the 3 Subject Property until the expiration the lease agreements. 4 Next, even if Goens’ unsupported allegations in the FAC could be considered 5 evidence, they do not establish the probable validity of Goens’ real property claim. The 6 FAC admits that before signing Lease #1, Defendants “informed [Goens] that the Subject 7 Property was listed for sale, but expressly stated that it would not be sold, because it had 8 been on and off the market for the past five years.” (FAC ¶ 29.) While Goens appears to 9 construe this statement as an unequivocal representation that the Subject Property would 10 not be sold, a more reasonable interpretation is that Defendants were pessimistic about 11 the prospect of selling the property given their experience over the past five years. 12 Indeed, the equivocal nature of Defendants’ representation is consistent with the next 13 paragraph in the FAC alleging that “Defendants also assured [Goens] prior to signing of 14 the two-year commercial lease agreement, that the sale of the property ‘would not 15 interfere with [his] lease term.’” (Id. ¶ 30, emphasis added.) This allegation necessarily 16 admits that Goens understood the property might sell during his lease. 17 Finally, Defendants also argue that Goens cannot prevail on his claim because the 18 lease agreements include an integration clause that provides in relevant part: 19 No Prior or Other Agreements; Broker Disclaimer. This Lease contains all agreements between the Parties with respect to any matter mentioned 20 herein, and no other prior or contemporaneous agreement or understanding 21 shall be effective.
22 (Blood Decl. ¶¶ 4, 9, Ex. A [Doc. 13-8] ¶ 22; Ex. D [Doc. 13-11] ¶ 22.) Tenant Estoppel 23 Certificates that Goens signed in connection with Lease #1 and Lease #2 reiterated the 24 integration clause: 25 The Tenant represents that the original Lease remains in full force and effect 26 and constitutes the entire agreement between Tenant and Landlord…There are no verbal or written agreements or understandings between Landlord and 27 Tenant with respect to the Premises, except as set forth above. 28 1 (Blood Decl. ¶¶ 6, 11, Ex. C [Doc. 13-10] ¶ 2; Ex. F [Doc. 13-11] ¶ 2.) According to 2 Defendants, “[w]hen a written agreement is complete and integrated, parol evidence, such 3 as what Plaintiff is attempting to utilize here with the alleged oral representations, cannot 4 be used to add or vary its terms. [Citations omitted.]” (P&A 13:25–14:3.) Goens 5 responds that because the parol evidence rule “was designed to prevent fraud, [it] may 6 not be used as a shield, aid or protect a party who relies on it in perpetration of a fraud. 7 [Citation omitted.]” (Opp’n 10:19–22.) Thus, Goens argues the parol evidence rule does 8 not apply, and the Court may grant the causes of action for injunctive relief and 9 reformation based on Defendants’ alleged misrepresentations. (Id. 11:8–12:5.) 10 California’s parol evidence rule is codified in Code of Civil Procedure § 1856, 11 which provides in relevant part: 12 (a) Terms set forth in a writing intended by the parties as a final expression of their agreement with respect to the terms included therein may not be 13 contradicted by evidence of a prior agreement or of a contemporaneous oral 14 agreement.
15 However, subdivision (f) sets forth a broad exception to the rule “[w]here the validity of 16 the agreement is the fact in dispute….” Subdivision (g) further provides that the parol 17 evidence rule does not “exclude other evidence of the circumstances under which the 18 agreement was made … to establish … illegality or fraud.” The California Supreme 19 Court explained the reason for this exception to the parol evidence rule: 20 This provision rests on the principle that the parol evidence rule, intended to 21 protect the terms of a valid written contract, should not bar evidence challenging the validity of the agreement itself. “Evidence to prove that the 22 instrument is void or voidable for mistake, fraud, duress, undue influence, 23 illegality, alteration, lack of consideration, or another invalidating cause is admissible. This evidence does not contradict the terms of an effective 24 integration, because it shows that the purported instrument has no legal 25 effect.” (2 Witkin, Cal. Evidence (5th ed. 2012) Documentary Evidence, § 97, p. 242; see also id., §§ 66 & 72, pp. 206 & 211.) 26
27 Riverisland Cold Storage, Inc. v. Fresno-Madera Production Credit Association, 55 28 Cal.4th 1169, 1175–76 (2013). 1 In their reply, Defendants argue that although Goens is alleging fraud in 2 connection with the formation of the lease agreements, the fraud exception to the parol 3 evidence rule does not apply because he is not seeking to void the leases, but instead to 4 enforce the oral agreements. (Reply [Doc. 22] 6:10–17.) This Court agrees. Although 5 Riverisland did not explicitly hold that the fraud exception does not apply where the 6 plaintiff is seeking to reform a written agreement, its explanation recognizes that the 7 exception is allowed to show the “instrument is void or voidable” and that evidence of 8 fraud is admissible to “show[] that the purported instrument has no legal effect.” Id. at 9 1175. 10 Defendants also point out that at least two district courts in California have 11 interpreted Riverisland’s explanation to preclude the fraud exception in cases where the 12 plaintiff is not seeking to void the contract, but instead to enforce an oral agreement / 13 representation. See Clear Connection Corp. v. Comcast Cable Communs. Mgmt., 2013 14 WL 6275313 (E.D. Cal. Dec. 4, 2013) (fraud exception to parol evidence does not apply 15 because plaintiff “does not seek to invalidate the contract; to the contrary… [it] seeks, via 16 compensatory damages, to enforce the alleged oral promises….”); Groth-Hill Land 17 Company v. General Motors, LLC, 2013 WL 3853160, *15 (N.D. Cal. Jul. 23, 2013) 18 (fraud exception to parol evidence rule does not apply where plaintiff is not attacking the 19 written agreement’s validity, but instead “seek[s] to recover based on promises 20 [defendant] allegedly made to them over the phone….”). Because Goens seeks to 21 enforce the alleged oral agreement allowing him to remain on the Subject Property until 22 the expiration of the lease agreements, and not simply invalidate the leases, the fraud 23 exception to the parol evidence rule does not apply. For this additional reason, the Court 24 finds Goens failed to establish that he will likely prevail on his causes of action for 25 injunctive relief and reformation. 26 27 28 1 IV. ATTORNEY’S FEES & COSTS 2 Defendants also seek an award of attorney’s fees and costs for bringing the motion 3 to expunge. Under section 405.38, a party that successfully moves to expunge a lis 4 pendens is entitled to an award of reasonable attorney’s fees and costs “unless the court 5 finds that the other party acted with substantial justification or that other circumstances 6 make the imposition of attorney’s fees and costs unjust.” 7 Because Goens failed to provide evidence supporting his claims, the Court finds 8 Defendants are entitled to an award of attorney’s fees. However, as discussed above, 9 whether Goens pled a real property claim under section 405.31 is a difficult question 10 under California law. Under these circumstances, the Court finds an award of $3,300 in 11 attorney’s fees is reasonable.3 12 13 V. CONCLUSION & ORDER 14 For the reasons set forth above, the Court GRANTS Defendant’s motion to 15 expunge [Doc. 13] and ORDERS as follows: 16 1. The notices of pendency of action (lis pendens) as (1) Document Number 2019- 0582227, recorded on December 13, 2019, and (2) Document Number 2019- 17 0592937, recorded on December 18, 2019, both in the office of the County 18 Recorder of San Diego County, are expunged.
19 2. Plaintiff Joshua Goens shall pay Defendants $3,300 in attorney’s fees. 20 3. Any Notice of Pendency of Action or Lis Pendens filed by the Plaintiff Joshua 21 Goens in relation to this matter shall be expunged, forthwith.
22 4. A copy of this Order may be filed with the San Diego County Recorder’s Office 23 and the applicable chain of title for the property described as 5901, 5909, and 5913 Mission Gorge Road, San Diego, CA 92120 (“Property”), and more particularly 24 described and identified as follows: 25 26 27 28 1 Those portions of Lots 1 and 2, in Block 46 of the "Amended Map 7 No. 1 of GRANTVILLE and Out Lots," in the City of San Diego, State of California, according to Map thereof No. 776, filed in the 3 Office of the County Recorder of San Diego County, February 16, A 1894, described as follows: 5 Commencing at the Northwest corner of Lot | in said Block 46: 6 thence North 89°36'20" (Record North 89°40'45" East) along the Northerly line of Lots 1 and 2 in said Block 46, to its intersection with 7 the Southeasterly line of County Road Survey No. 1287 as said Road g is described in deed to the County of San Diego, dated December 15, 1950 and recorded in Book 3935, Page 468 of Official Records being 9 the TRUE POINT OF BEGINNING; thence continuing North 10 89°36'20" East along the Northerly line of said Lot 2, a distance of 214.53 feet to. the Northwest corner of land conveyed to Earl L. 11 Hafer, et ux, by deed dated February 18, 1995, and recorded in Book 12 5561, Page 368 of Official Records; thence along the boundary of said land, South 13°30'30" East, 279.00 feet to the Northerly line of a 13 parcel of land described in deed to Jules C. Jaussaud, et ux. dated 14 November 30, 1939, and recorded in Book 1000, Page 114 of Official Records; thence along said Northerly line South 89°36'20" West 15 352.68 feet to the Southeast corner of the land conveyed to Dale 16 Arthur Worm, et ux, dated July 19, 1951, and recorded in Book 4201, Page 112 of Official Records; thence along the Easterly line of said 17 land 64°43'40" East to the TRUE POINT OF BEGINNING. 18 Assessor’s Parcel No.: 461-320-06-00 19 20 IT IS SO ORDERED. 71 Dated: January 31, 2020 \ p □ 73 Hn. 7 omas J. Whelan United States District Judge 24 25 26 27 28