On August 08, 2008 a
Motion-Secondary
was filed
involving a dispute between
Beacon Residential Community Association,
Catellus Commericial Development Corp.,
Catellus Development Corporation,
Catellus Operating Limited Partnership,
Catellus Residential Construction, Inc.,
Catellus Third And King Investors Llc,
Catellus Third And King Llc,
Catellus Urban Development Corporation,
Catellus Urban Development Group, Llc, A Delaware,
Centurion Real Estate Investors Iv,Llc,
Centurion Real Estate Partners, Llc,
Mission Place Llc,
Mission Place Mezzanine Llc,
Mission Place Mezz Holdings Llc,
Mission Place Partners Llc,
Prologis,
Shooter & Butts, Inc.,
Third And King Investors Llc,
Third And King Investors, Llc, A Delaware Limited,
Thyssenkrupp Elevator Corporation (Erroneously,
Webcor Builders,Inc,
Webcor Construction Inc.,
Webcor Construction, Inc Dba Webcor Builders,
Window Solutions, Inc.,
and
All Defendants See Scanned Documents,
Allied Fire Protection,
Anning-Johnson Company,
Architectural Glass & Aluminum Co., Inc,
Blue'S Roofing Company,
Carefree Toland Pools, Inc.,
Catellus Commerical Development Corporation,
Catellus Commericial Development Corp.,
Catellus Development Corporation,
Catellus Operating Limited Partnership,
Catellus Residential Construction, Inc.,
Catellus Third And King Investors Llc,
Catellus Third And King Llc,
Catellus Urban Development Corporation,
Catellus Urban Development Group, Llc, A Delaware,
Catellus Urban Development, Llc,
Centurion Partners, Llc,
Centurion Real Estate Investors Iv,Llc,
Centurion Real Estate Partners, Llc,
Creative Masonry, Inc,
Critchfield Mechanical, Inc.,
Cupertino Electric,Inc.,
Does 1 Through 200,
Does 52-200, Inclusive,
F. Rodgers Corporation,
F. Rodgers Corporation (Fka F. Rodgers Insulation,
F. Rodgers Insulation Residential, Inc.,
Hks Architects, Inc,
Hks, Inc,
Hks, Inc Individually And Dba Hks Architects, Inc,
J.W. Mcclenahan Co.,
Mission Place Llc,
Mission Place Mezzanine Llc,
Mission Place Mezz Holdings Llc,
Mission Place Partners Llc,
N.V. Heathorn, Inc.,
Poma Corporation,
Prologis,
Roofing Constructors, Inc. Dba Western,
Shooter & Butts, Inc.,
Skidmore Owings & Merrill Llp,
Skimore Owings & Merrill Llp,
Third And King Investors Llc,
Thyssen Krupp Elevator Corporation,
Thyssenkrupp Elevator Corporation (Erroneously,
Thyssenkrupp Elevators Corporation,
Tractel Inc.,
Van-Mulder Sheet Metal, Inc.,
Webcor Builders,Inc,
Webcor Construction Inc.,
Webcor Construction, Inc,
Webcor Construction, Inc Dba Webcor Builders,
Webcor Construction Inc.,Individually And Doing,
Webcor Construction Lp Individually And Dba Webcor,
Webcor Construction Partners Llc,
West Coast Protective Coatings, Inc.,
Western Roofing Service,
Window Solutions, Dba Window Solutions, Inc.,
Window Solutions, Inc.,
for CONSTRUCTION
in the District Court of San Francisco County.
Preview
‘WOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 84520-7882
TELEPHONE 925 222 3400 + FAx 925 222 3250
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Stacey F. Blank (State Bar No. 174378)
David S. Webster (State Bar No. 154301)
Woop, SMITH, HENNING & BERMAN LLP
1401 Willow Pass Road, Suite 700
Concord, California 94520-7982
Phone: 925 222 3400 ¢ Fax: 925 356 8250
John A. Koeppel (State Bar No. 71526)
Todd J. Wenzel ( Bar No. 158880)
Ropers, MAJESKI, KOHN & BENTLEY
201 Spear Street, Suite 1000
San Francisco, CA 94105
Phone: 415 543 4800 Fax: 415 972 6301
ELECTRONICALLY
FILED
Superior Court of California,
County of San Francisco
DEC 07 2012
Clerk of the Court
BY: ANNIE PASCUAL
Deputy Clerk
Attorneys for Defendants, CATELLUS THIRD AND KING LLC; CATELLUS
DEVELOPMENT CORPORATION; CATELLUS COMMERCIAL DEVELOPMENT
CORP.; CATELLUS OPERATING LIMITED PARTNERSHIP; CATELLUS URBAN
DEVELOPMENT CORPORATION; CATELLUS URBAN DEVELOPMENT GROUP LLC;
THIRD AND KING INVESTORS LLC; and PROLOGIS
SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF SAN FRANCISCO - UNLIMITED JURISDICTION
BEACON RESIDENTIAL COMMUNITY
ASSOCIATION,
Plaintiff,
v.
CATELLUS THIRD AND KING LLC;
CATELLUS DEVELOPMENT
CORPORATION, et al.
Defendants.
AND RELATED CROSS-ACTIONS
LEGAL:05863-0005/2485527.1
CASE NO. CGC-08-478453
MEMORANDUM OF POINTS AND
AUTHORITIES IN SUPPORT OF REPLY
TO PLAINTIFF'S OPPOSITION TO
MOTION FOR SUMMARY
ADJUDICATION OF CATELLUS ON
EIGHTH CAUSE OF ACTION
Complaint Filed: August 8, 2008
DATE: December 14, 2012
TIME: 10:00 a.m.
DEPT.: 304
JUDGE: Hon. Richard Kramer
Trial Date: 2/43
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY ADJUDICATION OF CATELLUS ON EIGHTH CAUSE OFAtlomeys at Law
WOOD, SMITH, HENNING & BERMAN LLP
1601 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 94520-7982
TELEPHONE 925 2223400 # Fax 925 2223250
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1. INTRODUCTION
Plaintiff Beacon Residential Community Association ("Plaintiff' or "BRCA") is a
homeowner association who continues to purport to prosecute individual claims of real
estate non-disclosure relating to unit temperatures on behalf of original and remote
subsequent owners of 595 separate Units at this Project despite its lack of standing.
After four sets of attorneys, six years of litigation, four endlessly-challenged complaints,
and countless hours of depositions, Plaintiff finally admits in its Opposition that Catellus
did not sell one Unit at this Project, and does not contest that all original purchasers
received Mission Place's written Disclosure Statement, and initialed the page containing
Mission Place's "Unit Temperature" disclosure.
One would think this would end the discussion and permit this Court to grant
Catellus' Motion for Summary Adjudication ("MSA"). However, Plaintiff now grasps to a
belief that Catellus has a legal duty, as a matter of law, to disclose what was disclosed by
the undisputed seller, Mission Place LLC. Absent a recognizable duty by Catellus
pursuant to Civil Code section 1710, Plaintiff's theory never leaves the ground.
In its Opposition, Plaintiff now asks this Court to deny Catellus' MSA after
conceding Catellus sold no Units and after failing to present any evidence whatsoever
that Catellus was ever in a fiduciary or confidential relationship with any purchaser, or
that Catellus had exclusive knowledge of material facts not otherwise known to Mission
Place. Plaintiff's Opposition to the Catellus Motion challenging the Eighth cause of action
for concealment and the claim for punitive damages fails to satisfy Plaintiff's burdens on
summary adjudication in many respects. Most notably, Plaintiff applies a wholly
inapplicable legal doctrine of “indirect deception" without presenting any evidence that
Catellus made any "fraudulent representation" required of that doctrine. Accordingly, as
Catellus has satisfied its initial and moving burdens, the Court is requested to grant
Catellus' MSA and dismiss such claims as a matter of law. In doing so, Plaintiff is free to
pursue its SB800 and/or alternative tort claims without resort to an unmeritorious claim.
LEGAL:05863-0005/2485527.1 ~1-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFE'S
OPPOSITION TO MOTION FOR SUMMARY ADJUDICATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
GONGORD, CALIFORNIA 94520-7982
TELEPHONE 925 222 3400 # FAX 925 2223250
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I ANALYSIS OF PLAINTIFF'S EVIDENCE AND ADDITIONAL MATERIAL FACTS
Plaintiff provides an Additional Statement of Undisputed Facts to supports its
claims. Those facts are discussed and described, in part, below.
As Plaintiff's evidence shows, in May of 2005, Mission Place sold the first units at
the Project. Plaintiff then incorrectly states, that in December of 2004, Catellus and its
management agent Prometheus Real Estate Group, Inc. (‘Prometheus’) had already
received "numerous" complaints from its tenants about excessive temperatures in their
units. Further, Plaintiff submits a series of hearsay statements prepared by Unit tenants
regarding their complaints relating to unit temperatures from September 2004 to March
2005. As such, such complaints are inadmissible as hearsay to properly oppose
summary adjudication. Moreover, Plaintiff's Opposition pleadings to the Catellus Motion
mischaracterizes this evidence in that it purports to say that such complaints were only
submitted to Catellus during applicable rental period in late 2004 and until Mission
Place's purchase was completed in late December 2004. Hf accepted over evidentiary
objections, this evidence actually demonstrates that such complaints were largely
submitted to Mission Place, who, in turn, shared such complaints with Catellus, the
property management company, Prometheus, Mission Place's lender, Lehman Brothers,
its real estate consultant, Marx Okubo, and its window film engineer and installer.
As discussed in Plaintiff's evidence, tenant complaints were limited to only four to
six units during Catellus' rental period as of November 2004 when some 266 units were
rented. Furthermore, Plaintiff states that, on November 3, 2004, Catellus Vice President
for Asset Management, Anni Chapman, whose supervised Prometheus, informed her
supervisor, Keith Anderson, that tenants at the Project were circulating a petition relating
to excessive temperatures in their units. However, Plaintiffs evidence shows that this
unsigned, proposed petition was actually submitted to Mission Place.
Plaintiff also attempts to submit evidence supporting the fact that Catellus
concealed the fact to Mission Place that a value engineering decision was made by
LEGAL:05863-0005/2485527.1 -2-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY ADIUDICATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 84520-7982
TELEPHONE 926 222 3400 + Fax 925 222 3250
Catellus to utilize clear glass instead of Low-E glass on the residential units. Despite only
citing to Robert Schlesinger's deposition testimony that he was personally not aware of
this specification until much later, Plaintiff fails to advise that Court that Jeff Worthe of
Mission Place testified that someone from Mission Place reviewed the specifications
during its due diligence investigation from August to December 2004. It is also
reasonable to infer from the evidence that clear glass was present as Mission Place was
itself investigating the tenant complaints and determining the proper window film to apply.
In many instances, Plaintiff's additional facts are simply immaterial and irrelevant
to the legal issues presented by the allegations in the TAC and the applicable law relating
to "duty" relating to claims of non-disclosure. Plaintiff admits that Catellus did not sell any
of the 595 units. However, Plaintiff then submits additional facts to invent triable issues
of fact to resist summary adjudication.’ Such facts and evidence are wholly immaterial to
determine whether Catellus owed a duty to disclose based on privity of contract, or,
alternatively, a fiduciary or confidential relationship, or exclusively known facts.
Thus, this evidence and reasonable inferences therefrom negate any duty by
Catellus and result in the conclusion that Mission Place and a multitude of others were
fully aware of such complaints, which Mission Place then considered and evaluated in
preparing its written Disclosure Statement. Such evidence also compels the conclusion
that Catellus did not have "exclusive knowledge" of these facts to give rise to a legal duty
to disclose to Mission Place's purchasers.
Plaintiff's Opposition fails to explain why its own evidence negates this legal
requirement, or any fiduciary of confidential relationship, to trigger a duty to disclose.
"For example, Plaintiff submits facts relating to select language in the CC&Rs purporting to
support that Catellus intended to sell units or that there was a strategy to market the Project. Such
evidence is inadmissible as hearsay and not properly the subject of judicial notice as to the content of the
language therein. Plaintiff also submits facts and deposition testimony relating to leasehold estates, which
is completely immaterial since Mission Place never soid land to its purchasers and there are no allegations
by Plaintiff in the TAC relating to the real property interests.
(LEGAL-:05863-0005/2485527.1 -3-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY AIUD ATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomays at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 94520-7962
TELEPHONE 825 222 3400 # Fax 925 222 3250
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Il, LEGAL ARGUMENT
A. Plaintiffs Opposition Misquides the Court as to the Proper Legal
Frincip| s Applicable to the Allegations in the Thi mended
omplaint.
Plaintiff incorrectly misguides this Court and blurs the clear distinction between
active fraudulent misrepresentation and fraudulent concealment, which are separate and
distinct species of fraud. In doing so, Plaintiff argues that a party who sells property
intended for future resale has an affirmative duty to disclose conditions to foreseeable
purchasers. Plaintiff cites to several cases for this same proposition, but fails to
appreciate that the doctrine of "indirect deception" is not the applicable legal standard to
be applied to the allegations within its own Third Amended Complaint (hereinafter "TAC").
Furthermore, these cases all involve instances where the prior owner made an active
statement of fact to another, which statement was the basis for the court's holdings.
Plaintiff's Opposition fails to set forth any evidence that Catellus had a duty or
actually made a statement of material fact regarding the Units, and fails to address the
proper legal requirements for duty of disclosure.
41. The allegations of non-disclosure in the TAC govern and limit
the materiality of facts subject to this Motion.
The allegations of the TAC set the framework for legal issues in the summary
adjudication motion. (See Goverment Employees ins. Co. v. Superior Court (Sims)
(2000) 79 Cal. App. 4th 95, 98 [the pleadings serve as the "outer measure of materiality"
in a summary judgment motion, and the motion may not be granted or denied on issues
not raised by the pleadings] and Nieto v. Blue Shield of Calif. Life & Health Ins. Co.
(2010) 181 Cal. App. 4th 60, 73 ["the pleadings determine the scope of relevant issues
on a summary judgment motion."].)”
7 as such, the TAC alleges that failures to disclose and suppressions of fact occurred when the
Members and their predecessors: "(1) entered into Contracts of Sale to purchase Units at the Subject
Property from defendants PROLOGIS/CATELLUS and MISSION PLACE, LLC; and (2) authorized the
close of escrow under said Contracts." (See TAC; para. 121, 54:22-25,) If the Members and their
LEGAL.05863-0005/2485527.1
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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY ADJUDICATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 94520-7982
TELEPHONE 925 2223400 ¢ Fax 925 222 3250
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Neither the above allegations nor Plaintiff's Opposition set forth any evidence that
Catellus made an actual representation of fact concerning the condition of the Units to
trigger the application of the legal elements relating to fraudulent misrepresentation as
discussed in Plaintiff's cited legal authority or Restatement 2d Torts, section 533.
2. Plaintiff's cited legal authority is inapposite to the issue of
whether Catellus owed a legally recognizable duty to disclose
already disclosed conditions to Mission Place, Mission Place's
purchasers, or subsequent purchasers.
The premise of Plaintiff's cited legal authority and doctrine of “indirect deception" in
the absence of privity of contract stems from Restatement 2d, section 533.° The
language of that section alone renders it and Plaintiff's legal argument without merit.
Here, Plaintiffs allege that Catellus failed to disclose and suppressed facts which
should have been disclosed by Catellus to Mission Piace's purchasers; and not that
Catellus made a fraudulent misrepresentation to Mission Place's or its purchasers, which
was intended to be repeated or its substance communicated to another.
The only application of the above Restatement to the material facts is as between
Catellus and Mission Place, which is not part of the MSA. Regardless, the facts and
evidence submitted by both parties make it clear and undisputed that both Mission Place
and Catellus received the five (5) tenant complaints regarding unit temperatures. Thus,
Catellus had no duty to disclose these facts to Mission Place where it was equally in
predecessors had been aware of such facts, the TAC alleges that they would not have". . . entered into
contracts of sale to purchase the Units and authorized the close of escrow under said contracts." (See
TAC; para. 721, 56:1-2.)
3 Restatement 2d of Torts, section 533, states as follows:
The maker of a fraudulent misrepresentation is subject to liability for pecuniary loss to
another who acts in justifiable reliance upon it if the misrepresentation, although not
made directly to the other, is made to a third person and the maker intends or has reason
to expect that its terms will be repeated or its substance communicated to the other, and
that it will influence his conduct in the transaction or type of transaction involved.
(emphasis added.)
The Comments to both section 533 and its origin, section 531, also make it clear that this Section
"deals with the persons to whom the maker of a fraudulent misrepresentation may be liable."
LEGAL:05863-0005/2485527.1 -#5-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY AQJUDICATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 94520-7982
TELEPHONE 925 222 3400 # Fax 925 222 3250
possession of the same tenant complaints.
Furthermore, Plaintiff's cited legal authority is inapposite as each holding
specifically relies on the fact that each defendant seller made an actual and express
tepresentation of fact to another.
In Shapiro v. Sutherland (1998) 64 Cal. App. 4th 1534, the appellate court
reversed the granting of a summary judgment motion where the mation was granted
based on the defendant being a "remote" seller and tacking privity with plaintiff.
However, Plaintiff BRCA fails to advise this Court that Sutherland, who sold the residence
to Prudential Relocation pursuant to an |BM employee relocation policy, actually
completed and signed a Civil Code section 1102.6 disclosure stating they were unaware
of any neighborhood noise problems. (/d. at 1539.) The evidence then demonstrated
that Sutherland's neighbors were a source of noise over a 15-year period and prompted
police reports for years, and that Prudential, as an agent for IBM, passed on Sutherland's
section 1102.6 disclosure to any buyer, including Plaintiff. Thus, the principles of indirect
deception and Restatement section 533 are satisfied. (/d. at 1539-40.)
In contrast, Catellus made no actual or express representations to Mission Place
or its purchasers, and certainly Catellus did not sign a section 1102.6 disclosure.
Instead, the evidence shows that the few tenant complaints and proposed petition were
submitted to both Catellus and Mission Place in late 2004, which was investigated by
Mission Place and its third party consultants as part of its purchase of the Project.
Likewise, in OCM Principal Opportunities Fund v. CIBC World Markets Corp.
(2007) 157 Cal. App. 4th 835, the court affirmed, in part, and reversed, in part, a
judgment after trial after finding that defendant CIBC made actual representations to
plaintiff investment funds within an offering memorandum concerning RCI's business
strategy and financial status in violation of various SEC regulations. However, the court
goes on, at length, to explain CIBC's extensive and active involvement in a string of
transactions involving the investment notes, and concludes that it owes a legal duty
LEGAL:05863-0005/2485527.1 -6-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY ADHUDICATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
CONCORD, CALIFORNIA 94570-7982
TELEPHONE 025 222 3400 ¢ Fax 925 2223250
1401 WILLOW PASS ROAD, SUITE 700
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under the appropriate legal standards. (/d. at 859-62.) Here, the evidence reveals that
Catellus, unlike CIBC, did not make an actual representation to Mission Place based on
knowledge exclusive to it at the time of acquisition in December 2004. Thus, Catellus
had no duty to disclose to Mission Place’s purchasers what Mission Place already knew.
The above holdings and Plaintiff rely on the holding in Geemaert v. Mitchell (1995)
31 Cal. App. 4th 601, which followed the sustaining of a demurrer based on lack of
allegations of duty, and not summary judgment or adjudication. Although the court
reverses the judgment sustaining the demurrer without leave to amend, it directs that a
seller's liability for indirect fraud may be resolved by demurrer or summary judgment, and
that "[t]hose who are without guilty knowledge or who had no reason to expect reliance
by the plaintiffs will still be entitled to expeditious relief upon a proper showing. (fd. at
609.) Moreover, unlike here, the court's holding that plaintiff alleged adequate facts
against Mitchell, the original owner-seller, included that he made several specific false
and fraudulent representations to others regarding the foundation system when he sold
the house in 1982, and that he knew that his foundation modifications were not
performed to code and that the residence was not sound. (/d. at 604-05.) The court
allowed the pleading in applying the principles of indirect deception from Restatement
section 533.
Plaintiff entire line of legal authority‘ is misplaced and should be disregarded.
3. Plaintiff's Opposition wholly fails to address the proper legal
standards to establish a duty to disclose set forth in the Motion.
Catellus' Motion sets forth substantial legal authority directly on point with identical
claims by homeowner associations and their members for nondisclosure against non-
4 Lastly, Plaintiff relies on the holding in Varwig v. Anderson-Behe! Porsche/Audi, Inc. (1977) 74
Cal. App. 3d 578, despite the fact that the court relies heavily on the fact that defendant dealer made an
actual and false representation to a later dealer that the vehicle had transferable title when, in fact, it was
repossessed. Relying on Restatement section 533, the court held that such evidence could support a
claim of indirect deception where the subsequent dealer and plaintiff would rely on this representation of
title as being true when that dealer sold the vehicle to plaintiff.
LEGAL: MEMORANDUM 1 -T-
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY ADIUDICATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA 84520-7882
TELEPHONE 925 222 3400 © Fax 826 222 3250
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selling defendants for allegedly defective building components. Inextricably, Plaintiff
chose not to even comment or address this legal authority or argument.
More specifically, Civil Code section 1710 defines deceit, in part, as "the
suppression of a fact, by one who is bound to disclose it, or who give information or other
facts which are likely to mislead for want of communication of that fact." (emphasis
added.) Thus, the only person subject to a claim for concealment, as a species of deceit,
is one with an obligation to disclose the fact. Civil Code Section 1102.3 requires that the
“transferor of any real property” shall deliver the prospective transferee the required
written Transfer Disclosure Statement set forth in section 1102.6. Plaintiff, and Mission
Place in its Motion, do not dispute that Mission Place sold the Units to the Members, and
that Mission Place provided the written Disclosure Statement to each purchaser.
In addressing Civil Code section 1710(3), the court in LaJolla Village Homeowners
Association v. Superior Court (Quality Roofing) (1989) 212 Cal.App.3d 1131, 1152, held
that "[t]o fasten liability under this section on a party alleged to be guilty of non-disclosure
or fraudulent concealment of certain facts, it is necessary to show that the party was
under a legal duty to disclose them. The court cited to Lingsch v. Savage (1963) 213
Cal App.2d 729, 735-736, for the rule that such a duty may arise from a fiduciary or
confidential relationship, privity of contract, or from special circumstances, oftentimes in
cases dealing with the sale of property.
Plaintiff's Opposition glaringly fails to present any competent evidence or argument
that Catellus is in a fiduciary or confidential relationship with the close to 600 purchasers
of Mission Place to trigger any legal duty to disclose; not to mention the multitudes of
subsequent purchaser Members. Plaintiff also concedes that Mission Place sold all Units
and provided the written Disclosure Statement advising of unit temperature conditions,
but fails to address how these undisputed facts would otherwise negate any of the above
factors to trigger a legal duty by Catellus to disclose. Moreover, Plaintiff cannot do so
when its own evidence demonstrates that Mission Place independently received the
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same tenant unit temperature complaints as received by Catellus in late 2004. Thus, the
undisputed evidence also demonstrates that Catellus did not have "exclusive knowledge”
of material facts contemporaneously known to Mission Place or the Members upon
receipt of the Mission Place's Disclosure Statement. (See Limandri v. Judkins (1997) 52
Cal.App.4th 326, 337; and BAJI No. 12.36 (8th ed. 1994.)
Even Plaintiff's red herring argument relating to the decision not to install Low-E
glazing on the windows cannot create a duty. Mission Place reviewed the specifications
while purchasing the Project. Moreover, in disclosing facts regarding real property, a
party is not required to provide details. "Once the essential facts are disclosed, a seller is
not under a duty to provide details that would merely serve to elaborate on the disclosed
facts." (Calemine v. Samuelson (2009) 171 Cal. App. 4th 153, 161.)°
Accordingly, without a legally recognized duty to disclose, the Eighth cause of
action for nondisclosure or concealment against Catellus should be dismissed.
B. Plaintiff Fails To Satisfy Its Burden To Resist Summary Adjudication
n Its Punitive Damages Claim Against Catellus Where No Merit To Its
concealment Exists and No Supporting Evidence Exists.
Plaintiff opposes summary adjudication of the punitive damages claim based on
the same non-existent claims of concealment regarding unit temperatures within Units.
This is based on evidence that "many" and "several" tenants complained of severe
overheating problems, including in a “formal protest petition.” Plaintiff also cites to
complaints of physical injury, that units were uninhabitable for 11 months a year, and that
there is a “convection oven-like situation." (See Opposition; 13: 15-14:11.) Plaintiff
argues that such evidence creates a triable issue of fact.
However, Plaintiff concedes, as it must, that such complaints were known to
5 Mission Place's written Disclosure Statement advised all original purchasing Members that the
Units do not have air conditioning and that “[clertain units may become uncomfortably warm when exposed
to sunny conditions and/or hot weather." As argued in Mission Place's Motion, this is an adequate
disclosure as required by California law and no elaboration is required by law. (See Mission Place Motion
for Summary Adjudication Memorandum §il1.B.1, at pp. 8:10 ~ 9:16.)
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MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY AQJUDIC ATION OF CATELLUS ON EIGHTH CAUSE OFWOOD, SMITH, HENNING & BERMAN LLP
Attomeys at Law
1401 WILLOW PASS ROAD, SUITE 700
CONCORD, CALIFORNIA $4520-7982
TELEPHONE 925 222.3400 + FAX 925222 9250
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Mission Place, which is fatal to this argument once Mission Place issued the written
Disclosure Statement to its purchasers. (Opposition; 13:16.)
In fact, a careful review of the presented evidence demonstrates that only four to
six of 266 tenant units (i.e. (1.5-2%) actually made complaints during the four-month
rental tenancy period between approximately August to November 2004 before close of
escrow in December 2004. (See Mission Place Motion for Summary Adjudication
Memorandum at page 10, line 11.) Moreover, many of these scant complaints were
provided directly to Mission Place, who, in turn, conveyed them to Catellus. (See Sung
Shim Declaration, Exhs. AA, BB, and CC.) This includes the 'so-called' formal petition,
which was merely a proposed, unsigned, circulated one-page petition prepared by two
residents of one unit. Plaintiff presents no evidence of one signature to this petition.
In the end, Plaintiff fails to satisfy its burden to successfully resist summary
adjudication as to its punitive damages claim against a defendant in Catellus who has no
established legal duty. Without any supporting “clear and convincing" evidence, Plaintiff
cannot prosecute an unmeritorious fraud claim on behalf of its Members without proper
standing and in the face of an undisputed and acknowledged written Disclosure
Statement from Mission Place regarding the actual conditions of certain Units.
IV. CONCLUSION
Defendant Catellus respectfully requests that this Court grant this Motion for
Summary Adjudication as to Plaintiffs Eighth Cause of Action for Concealment and the
allegations and claim for punitive damages set forth within the Eighth Cause of Action.
DATED: December 7, 2012 WOOD, SMITH, HENNING & BERMAN LLP
By: A)
DAVID S. WEBSTI
ROBIN L. KURTZSCH
Attorneys for “CATELLUS" Defendants
LEGAL:05863-0005/2485527.1
MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF REPLY TO PLAINTIFF'S
OPPOSITION TO MOTION FOR SUMMARY ADJUDICATION OF CATELLUS ON EIGHTH CAUSE OF