Preview
1 10/16/2020
KATHLEEN C. LYON, CSB # 236224
klyon@asilaw.org
2 KATRINA L. JOHNSON, CSB #213479
kjohnson@asilaw.org
3 ARONOWITZ SKIDMORE LYON
A Professional Law Corporation
4 200 Auburn Folsom Road, Suite 305
Auburn, California 95603
5 Telephone: (530) 823-9736
Fax: (530) 823-5241
6
Attorneys for Terry Murphy
7
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 IN AND FOR THE COUNTY OF PLACER
10 Case No.: S-CV-0044249
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
RUSSELL ROARK,
11 REPLY OF DEFENDANT TERRY
PLAINTIFF,
Tel (530)823-9736, Fax (530) 823-5241
MURPHY IN SUPPORT OF HER
12 DEMURRER TO THE FIRST
vs. AMENDED COMPLAINT
13
TERRY MURPHY; and DOES 1 through 10,
14 inclusive, Date: October 23, 2020
Time: 8:30am
15
DEFENDANTS. Dept.: 3
16
Complaint: February 13, 2020
17 FAC: June 29, 2020
18
19
20
21
22 Pursuant to Code of Civil Procedure section 430.10(e) – (g), defendant, TERRY
23 MURPHY (“Defendant” or “Murphy”) submits the following reply (“Reply”) to plaintiff,
24 RUSSELL ROARK’s (“Plaintiff”) opposition to the (“Demurrer”) to the First Amended
25 Complaint (“FAC”).
26 ///
27 ///
28 ///
1
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
1 REPLY
2 A. Plaintiff’s highly unusual method of filing a verified complaint is not appropriate.
3 Plaintiff admits he did not file a verification with the FAC, claiming that it, as the last
4 page, did not scan properly. Plaintiff thereafter filed a verification seven weeks later. However,
5 no where in the FAC does it state that the complaint is verified. Murphy has pointed out extremely
6 damaging statements in the FAC and misrepresentations of the truth to the Court contained
7 therein. If Plaintiff asks the Court to rely solely on his conclusory allegations against Murphy to
8 overcome the statute of frauds, the statute of limitations and unclean hands, to gain an interest in
9 property title solely in the name of Murphy, he should at the very least be made to clearly state a
10 verified complaint should the FAC survive demurrer. It should further be noted that the
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
11 verification would come after the signature page and prior to the Exhibits, which Exhibits
Tel (530)823-9736, Fax (530) 823-5241
12 immediately followed the signature page without interruption.
13 B. Plaintiff admits he did not amend the lis pendens to reflect the new party.
14 When new parties are added to an action under CCP § 742, they must be named in the
15 notice of pendency of action (“Lis Pendens”). The Lis Pendens must be amended, served,
16 recorded and filed. (CCP §405.22.) Plaintiff admits he did not do this. (Opposition Part III.)
17 “Any notice of pendency of action shall be void as to any adverse party or owner of record
18 unless the requirements of Section 405.22 are met for that party or owner.” (CCP § 405.23.)
19 Therefore, the currently filed Lis Pendens does not reflect the action, which is fatal to the FAC.
20 C. All Causes of Action based on an oral agreement to transfer real property fails
for the statute of frauds.
21
22 Plaintiff admits the breach of contract claims fail for the statute of fraud unless it can be
23 saved by an equitable doctrine. (Opposition IV.A.) Plaintiff relies solely on a 60 year old case,
24 Harrison v. Hanson (1958) 165 Cal.App.2d 370, for the proposition that Plaintiff’s alleged
25 $40,000 deposit and $10,000 in improvements constitutes part performance enough to except
26 this action from the statute of frauds. Plaintiff’s reliance on Harrison v. Hanson is misplaced.
27 Harrison v. Hanson clearly states such an exception has a high standard. In rejecting plaintiff’s
28 claim the court held:
2
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
1 “A cause of action seeking specific performance of an oral contract for the sale of real
property, being clearly within the statute of frauds, can only be taken out of the statute
2 and enforced in equity by reason of part performance thereof 1. The payment of money,
which formed the consideration of an oral agreement, even the full amount agreed upon,
3 would not justify the relief sought, 2 hence additional facts must be alleged which
establish a sufficient change in the plaintiffs' position that the application of the statutory
4 bar would result in an unjust and unconscionable loss. 3 This might have been
accomplished by the vendee's taking possession in reliance on the oral agreement 4, the
5 subsequent making of valuable improvements 5, or other acts unequivocally referable to
the verbal agreement. 6 (Harrison v. Hanson (1958) 165 Cal.App.2d 370, 376 [(S)light
6 and temporary improvements, or trivial outlays . . . do not raise an equity in the donee]”
7 (Id. at 377 [emphasis added].) This is supported by Francis v. Colendich (1961) 193 Cal.App.2d
8 128, “Mere payment of money is not enough, but taking possession in reliance on the oral
9 agreement, if it is actual, visible, notorious and exclusive so that it furnishes evidence of the
10 agreement between the parties as good as a writing, is sufficient to take the agreement out of
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
11 the statute.” (Id. at 131 [emphasis added].)
Tel (530)823-9736, Fax (530) 823-5241
12 Plaintiff offers no evidence outside of initial payment of money to support the alleged
13 oral agreement. In fact, the absence of a written request to put his name on title for six years and
14 the fact that Plaintiff forwent collecting any rents on the Property for six years clearly evidences
15 the lack of any agreement between the parties. Therefore, neither the initial alleged deposit,
16 forming the consideration of an oral agreement, nor the trivial amounts spent in repair, justify
17 an exception to the statute of frauds. As this is the only exception put forth in opposition,
18 Plaintiff by his own cited authority fails to overcome the very high burden required and the
19 breach of oral agreement on real property fails.
20 Plaintiff had ample opportunity to insist in writing that Murphy put title to the Property
21 into both his and Murphy’s names, but voluntarily chose not to do so due to tax evasion and
22 creditor fraud. (FAC ¶¶ 12, 24; RFJN Exh 1-8.) Plaintiff has not, and cannot, allege a written
23 agreement to transfer an interest in the Property to him after its purchase. Therefore, the
24 Demurrer should be sustained without leave to amend based on the statute of frauds.
25
1
26 Davis v. Judson, 159 Cal. 121, 131.
2
Shive v. Barrow, 88 Cal.App.2d 838, 848.
3
27 Mason v. Home Ins. Co., 10 Cal.App.2d 696.
4
Halloran v. Isaacson, 95 Cal.App.2d 357, 367.
5
Laughton v. McDonald, 61 Cal.App. 678, 681.
28 6
Baker v. Bouchard, 122 Cal.App. 708, 711.
3
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
1 D. Plaintiff admits an action for breach of an oral agreement fails after two years.
2 Plaintiff admits the statute of limitations for an oral contract is two years. Plaintiff
3 further admits the oral contract, if any, was formed in early 2014. However, Plaintiff attempts to
4 save the action by stating that it was not until Murphy and Plaintiff broke up in August 2017
5 that Plaintiff demanded to be put on title. (Opposition IV.B.) This fails for several reasons.
6 Paragraph 17 of the FAC does not say August 2017 was the first time Plaintiff
7 demanded to be put on title. In fact, nowhere in the FAC does it state when Murphy should
8 have, or was asked to, put Plaintiff on title. Plaintiff pleads the oral agreement, at the time of
9 purchase, was that Murphy would put Plaintiff on title to the Property. It does not allege
10 Murphy would put Plaintiff on title if and when they broke up. It does not allege that would
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
11 happen when the tax liens lifted. Plaintiff ignores that on the face of the complaint, the two-year
Tel (530)823-9736, Fax (530) 823-5241
12 limitation accrued when the Property closed and Plaintiff was not on title, with his full
13 knowledge (and at his request). Plaintiff’s claim that the statute tolled while he was in a
14 relationship has no merit in law or equity. Plaintiff does not even attempt to claim delayed
15 discovery based on being in love. It begs the question of whether there even was a “contract” of
16 definite terms as to when Plaintiff was to be put on title and it begs the questions of what was
17 the breach and when did the breach occurred. The Opposition argues Plaintiff right out of a
18 definitive contract by these questions.
19 Furthermore, by exhibits to the Request for Judicial Notice (“RFJN”) to the Demurrer,
20 one might assume Plaintiff was at least put on notice to request to be put on title once his tax
21 fraud was no longer pronounced. The latest date at is when he paid off the last federal tax lien in
22 February 2016. In hiding those liens from the Court, Plaintiff could not make that argument in
23 the FAC.
24 E. Plaintiff’s fraud claims are similarly time-barred.
25 For the same reasons set forth in Section D above, the three-year statute of limitations for
26 fraud is similarly time barred from April 2014, or at the latest, after the last lien was paid in
27 February 2016.
28
4
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
F. Plaintiff admits his tax fraud is a direct link to the Property title precluding
1 Plaintiff from recovery by the doctrine of unclean hands.
2 Plaintiff admits in the Opposition to committing tax fraud to avoid liens by not being on
3 title. In response to that admission in the Opposition, who cares what Plaintiff used his money
4 for instead of paying his tax liens. (Opposition p. 8:12-14.) The fact that he alleges he used the
5 money for a deposit that he is now seeking equitable recovery of, is ironic. Plaintiff claims,
6 “since each lien was subsequently release,” no harm no foul. (FAC p.8:11-15.) Perhaps that is
7 why Plaintiff withheld this information from the Court, an instead states in the FAC, “turns out,
8 there was no threat of tax liens.” (FAC ¶ 12 & 24.) That is glaringly untrue. This is a man who
9 lays his claims in equity. There is no factual finding required when Plaintiff admits to his tax
10 fraud and the Exhibits to the RFJN proves he withheld it from the Court, committing a fraud
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
11 upon the Court.
Tel (530)823-9736, Fax (530) 823-5241
12 Plaintiff goes on to be so bold, “even if the court were to find Plaintiff guilty of tax fraud
13 as a matter of law…” I’m still not bad. (FAC p. 8:19-20.) He then proceeds to newly blame the
14 entire fraud on Murphy, claiming he was entrapped by the girlfriend when he removed himself
15 from title knowing he had tax liens. The FAC states Plaintiff decided not to be on title for fear
16 the tax liens would affect his interest in the Property. (FAC ¶ 12.) Rather than pay $40,000 to
17 his delinquent taxes in 2014, Plaintiff alleges he made an initial payment on the Property.
18 Plaintiff was not merely hiding from his tax debt, he made a conscience decision to put his
19 money into the Property instead of into his debt.
20 Plaintiff’s reliance on Warren v. Merrill (2006) 143 Cal.App.4th 96 (“Warren”) is
21 entirely misplaced. In Warren the buyer had poor credit and could not get a loan. His broker, in
22 his fiduciary capacity, told him that he could put the loan in the broker’s daughter’s name and
23 thereafter convinced buyer to amend the purchase agreement to put title in the broker’s
24 daughter’s name only. (Id. at 100.) Here, not only is Murphy not in a fiduciary relationship with
25 Plaintiff, as stated above, Plaintiff decided to put money into property rather than his taxes, not
26 Murphy. Additionally, no state court in the Country has cited the Second District opinion in
27 Warren and the two Ninth Circuit citations are to other issues in Warren.
28 Murphy’s reliance on Katz v. Karlsson (1948) 84 Cal.App.2d 469 should control.
5
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
1 “Whenever a party, who, as actor, seeks to set the judicial machinery in motion and obtain some
2 remedy, has violated conscience, or good faith, or other equitable principle, in his prior conduct,
3 then the doors of the court will be shut against him, in limine; the court will refuse to interfere
4 on his behalf, to acknowledge his right, or to award him any remedy. (Id. at 474-475 7.)
5 As set forth in the moving paper, A demurrer will be sustained based on unclean hands
6 where: (1) there is supporting case law; (2) the nature of the misconduct is sufficient to support
7 the doctrine of unclean hands; and (3) the relationship between the misconduct is sufficiently
8 related to the claimed injuries. (Unilogic, Inc. v. Burroughs Corp. (1992) 10 Cal.App.4th 612,
9 619-20.) There are no factual disputes as to Plaintiff’s tax fraud. There is no dispute, in fact it is
10 admitted, that the relationship between the tax fraud and title is directly related, and there is
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
11 supporting case law. Unclean hands is ripe for decision as a matter of law.
Tel (530)823-9736, Fax (530) 823-5241
12 G. Plaintiff fails to sufficiently address laches.
13 Plaintiff does not argue that laches is not applicable. He only argues that Murphy cites
14 no prejudice to assert laches. After six years, Plaintiff is claiming he is owed monies paid in
15 2014 and rents collected since 2014, plus an accounting of all expenses and income since 2014
16 on the Property, and yet states Murphy is not prejudice by the six year delay? The prejudice lies
17 in Plaintiff’s claim of damages that never existed prior to the filing of the complaint. He now
18 wants Murphy to regurgitate amounts over $100,000. The defense of Laches is evident on the
19 fact of the FAC.
20 H. Plaintiff’s fraud claim is merely conclusory to which the Opposition does not
respond.
21
22 Plaintiff does not even respond to the lack of evidentiary evidence supporting fraud.
23 Without citation to authority, or rebuttal of Murphy’s authority, Plaintiff merely submits in a
24 conclusory fashion that fraud is sufficiently pleaded. The Opposition relies solely on a single
25 conclusory allegation in the FAC that Murphy had “no intention of ever adding Plaintiff on title.”
26 The FAC actually alleges this “on information and belief.” (FAC ¶24.) Contentions and
27
7
The Moving papers cite this case incorrectly as Katz v. Karlsson (1948) 84 Cal.App.2d 474. An apology is offered
28
to the Court and counsel for any delay or concern the mis-citation caused.
6
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
1 conclusory allegations will not be deemed true where the legal sufficiency of a complaint is
2 challenged on a demurrer or motion to strike. (Serrano v. Priest (1971) 5 Cal.App.3d 584, 591.)
3 There is not a single fact in support of this information and belief that Murphy knew, at a
4 misrepresentation that it was false, or that she knew it to be false at the time of making it, nine
5 years into their twelve year relationship. Taking the Opposition on its face, Plaintiff did not
6 request to be put on title until after they broke up, which fact is not pleaded in the FAC). Even if
7 that were true, that does no allege Murphy new at the time of purchase in 2014 that she made a
8 representation she knew, at the time, to be false.
9 Even more concerning here is that lack of allegation that Murphy induced Plaintiff into
10 putting her solely on title. Quite the opposite. An action for promissory fraud may lie where a
200 Auburn Folsom Road, Suite 305, Auburn, CA 95603
11 defendant fraudulently induces the plaintiff to enter into a contract. (Lazar v. Superior Court
Tel (530)823-9736, Fax (530) 823-5241
12 (1996) 12 Cal.4th 631, 638.) The FAC alleges, “MURPHY took title in her name alone because
13 Plaintiff was worried that he might have outstanding debts that could negatively impact the
14 closing and / or future ownership of the property through encumbrances.” (FAC ¶ 12.) It was
15 clearly Plaintiff’s idea to evade taxes. There is no allegation Plaintiff would have put himself on
16 title but for Murphy’s inducement. Plaintiff could not have put himself on title because the state
17 and federal government would have seized his investment to pay his taxes. Because Plaintiff
18 could not have been on title to the Property in any event, Plaintiff cannot plead detrimental
19 reliance. (Id. at 642.) All reference to punitive damages must be stricken as prayed.
20 I. The Second Cause of Action for Fraud fails for the statute of limitations.
21 For the same reasons set forth in Section H above, Plaintiff claims no reasonable
22 delayed discovery. Although the FAC is devoid of dates he requested to be put on title, he is
23 now claiming that it first occurred when Plaintiff and Murphy broke up. Why?
24 J. The Second Cause of Action for Actual Fraud is barred by unclean hands as a
matter of law.
25
The Second Cause of Action is barred by unclean hands for the reasons stated above.
26
Plaintiff cannot as a matter of law claim Murphy defrauded him when he was the one
27
attempting to defraud the government. Nowhere in the FAC is it plead Murphy was complicit in
28
7
Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint
I Plaintiff s Fraud.
2 K. Plaintiff fails to cite authority for duty.
3 The existence of a duty is a matter of law. (KentuclE Fried Chicken of Cal., Inc. v.
4 Superior Court (1997) 14 Cal.4th 814, 819.) The FAC and Opposition rely only on a boyfriend-
5 girlfriend relationship to create a duty without a shred of support. That theory could take some
6 high schoolers aback! No California court has held that a "boyfriend-girlfriend" relationship
7 gives rise to a confidential relationship.
8 CONCLUSION
9 The Demurrer to the FAC should be sustained in full as to each cause of action jointly or
c-t 10 severally without leave to amend. Plaintiff attempts to refute the remaining causes of action on
\o
Z (n
o\
tl the same ground as distinguished above. The moving papers clearly set forth why the Demurrer
I
)-l
u+
JN
a
r't
tr(nI
c.)
l2 to each cause of action jointly and severally should be sustained without leave to amend.
,-( *= c.l
r+
i-l ioo
v 13 Plaintiff proffers no new facts to support the causes of action with the possible exception of
a ".i =
oX cc
.= 14 filing a second amended complaint with the proper verification. Anything else would be deemed
g
t-(
-l
a=rt
o ^\o
Eca
a d[*-
oo\ 15 a sham pleading by judicial admission.
N
i-a
&"\
(- C\
I trm
o
aO 16 Dated: October 16,2020 Respectful ly submitted,
,-- =cn
,? (n
Z tro")
17 ARONOWITZ SKIDMORE LYON
=F
-o
tV
r-{
A Professional Law Corporation
l8
c\
19
KATHLEEN C. N
20 Attorney for Te Murphy
21
22
23
24
25
26
27
28
Defendant,s Reply to Plaintiffs Opposition to Demurrer to the First Amended Complaint
Preview
1 10/16/2020 KATHLEEN C. LYON, CSB # 236224 klyon@asilaw.org 2 KATRINA L. JOHNSON, CSB #213479 kjohnson@asilaw.org 3 ARONOWITZ SKIDMORE LYON A Professional Law Corporation 4 200 Auburn Folsom Road, Suite 305 Auburn, California 95603 5 Telephone: (530) 823-9736 Fax: (530) 823-5241 6 Attorneys for Terry Murphy 7 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 IN AND FOR THE COUNTY OF PLACER 10 Case No.: S-CV-0044249 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 RUSSELL ROARK, 11 REPLY OF DEFENDANT TERRY PLAINTIFF, Tel (530)823-9736, Fax (530) 823-5241 MURPHY IN SUPPORT OF HER 12 DEMURRER TO THE FIRST vs. AMENDED COMPLAINT 13 TERRY MURPHY; and DOES 1 through 10, 14 inclusive, Date: October 23, 2020 Time: 8:30am 15 DEFENDANTS. Dept.: 3 16 Complaint: February 13, 2020 17 FAC: June 29, 2020 18 19 20 21 22 Pursuant to Code of Civil Procedure section 430.10(e) – (g), defendant, TERRY 23 MURPHY (“Defendant” or “Murphy”) submits the following reply (“Reply”) to plaintiff, 24 RUSSELL ROARK’s (“Plaintiff”) opposition to the (“Demurrer”) to the First Amended 25 Complaint (“FAC”). 26 /// 27 /// 28 /// 1 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint 1 REPLY 2 A. Plaintiff’s highly unusual method of filing a verified complaint is not appropriate. 3 Plaintiff admits he did not file a verification with the FAC, claiming that it, as the last 4 page, did not scan properly. Plaintiff thereafter filed a verification seven weeks later. However, 5 no where in the FAC does it state that the complaint is verified. Murphy has pointed out extremely 6 damaging statements in the FAC and misrepresentations of the truth to the Court contained 7 therein. If Plaintiff asks the Court to rely solely on his conclusory allegations against Murphy to 8 overcome the statute of frauds, the statute of limitations and unclean hands, to gain an interest in 9 property title solely in the name of Murphy, he should at the very least be made to clearly state a 10 verified complaint should the FAC survive demurrer. It should further be noted that the 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 11 verification would come after the signature page and prior to the Exhibits, which Exhibits Tel (530)823-9736, Fax (530) 823-5241 12 immediately followed the signature page without interruption. 13 B. Plaintiff admits he did not amend the lis pendens to reflect the new party. 14 When new parties are added to an action under CCP § 742, they must be named in the 15 notice of pendency of action (“Lis Pendens”). The Lis Pendens must be amended, served, 16 recorded and filed. (CCP §405.22.) Plaintiff admits he did not do this. (Opposition Part III.) 17 “Any notice of pendency of action shall be void as to any adverse party or owner of record 18 unless the requirements of Section 405.22 are met for that party or owner.” (CCP § 405.23.) 19 Therefore, the currently filed Lis Pendens does not reflect the action, which is fatal to the FAC. 20 C. All Causes of Action based on an oral agreement to transfer real property fails for the statute of frauds. 21 22 Plaintiff admits the breach of contract claims fail for the statute of fraud unless it can be 23 saved by an equitable doctrine. (Opposition IV.A.) Plaintiff relies solely on a 60 year old case, 24 Harrison v. Hanson (1958) 165 Cal.App.2d 370, for the proposition that Plaintiff’s alleged 25 $40,000 deposit and $10,000 in improvements constitutes part performance enough to except 26 this action from the statute of frauds. Plaintiff’s reliance on Harrison v. Hanson is misplaced. 27 Harrison v. Hanson clearly states such an exception has a high standard. In rejecting plaintiff’s 28 claim the court held: 2 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint 1 “A cause of action seeking specific performance of an oral contract for the sale of real property, being clearly within the statute of frauds, can only be taken out of the statute 2 and enforced in equity by reason of part performance thereof 1. The payment of money, which formed the consideration of an oral agreement, even the full amount agreed upon, 3 would not justify the relief sought, 2 hence additional facts must be alleged which establish a sufficient change in the plaintiffs' position that the application of the statutory 4 bar would result in an unjust and unconscionable loss. 3 This might have been accomplished by the vendee's taking possession in reliance on the oral agreement 4, the 5 subsequent making of valuable improvements 5, or other acts unequivocally referable to the verbal agreement. 6 (Harrison v. Hanson (1958) 165 Cal.App.2d 370, 376 [(S)light 6 and temporary improvements, or trivial outlays . . . do not raise an equity in the donee]” 7 (Id. at 377 [emphasis added].) This is supported by Francis v. Colendich (1961) 193 Cal.App.2d 8 128, “Mere payment of money is not enough, but taking possession in reliance on the oral 9 agreement, if it is actual, visible, notorious and exclusive so that it furnishes evidence of the 10 agreement between the parties as good as a writing, is sufficient to take the agreement out of 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 11 the statute.” (Id. at 131 [emphasis added].) Tel (530)823-9736, Fax (530) 823-5241 12 Plaintiff offers no evidence outside of initial payment of money to support the alleged 13 oral agreement. In fact, the absence of a written request to put his name on title for six years and 14 the fact that Plaintiff forwent collecting any rents on the Property for six years clearly evidences 15 the lack of any agreement between the parties. Therefore, neither the initial alleged deposit, 16 forming the consideration of an oral agreement, nor the trivial amounts spent in repair, justify 17 an exception to the statute of frauds. As this is the only exception put forth in opposition, 18 Plaintiff by his own cited authority fails to overcome the very high burden required and the 19 breach of oral agreement on real property fails. 20 Plaintiff had ample opportunity to insist in writing that Murphy put title to the Property 21 into both his and Murphy’s names, but voluntarily chose not to do so due to tax evasion and 22 creditor fraud. (FAC ¶¶ 12, 24; RFJN Exh 1-8.) Plaintiff has not, and cannot, allege a written 23 agreement to transfer an interest in the Property to him after its purchase. Therefore, the 24 Demurrer should be sustained without leave to amend based on the statute of frauds. 25 1 26 Davis v. Judson, 159 Cal. 121, 131. 2 Shive v. Barrow, 88 Cal.App.2d 838, 848. 3 27 Mason v. Home Ins. Co., 10 Cal.App.2d 696. 4 Halloran v. Isaacson, 95 Cal.App.2d 357, 367. 5 Laughton v. McDonald, 61 Cal.App. 678, 681. 28 6 Baker v. Bouchard, 122 Cal.App. 708, 711. 3 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint 1 D. Plaintiff admits an action for breach of an oral agreement fails after two years. 2 Plaintiff admits the statute of limitations for an oral contract is two years. Plaintiff 3 further admits the oral contract, if any, was formed in early 2014. However, Plaintiff attempts to 4 save the action by stating that it was not until Murphy and Plaintiff broke up in August 2017 5 that Plaintiff demanded to be put on title. (Opposition IV.B.) This fails for several reasons. 6 Paragraph 17 of the FAC does not say August 2017 was the first time Plaintiff 7 demanded to be put on title. In fact, nowhere in the FAC does it state when Murphy should 8 have, or was asked to, put Plaintiff on title. Plaintiff pleads the oral agreement, at the time of 9 purchase, was that Murphy would put Plaintiff on title to the Property. It does not allege 10 Murphy would put Plaintiff on title if and when they broke up. It does not allege that would 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 11 happen when the tax liens lifted. Plaintiff ignores that on the face of the complaint, the two-year Tel (530)823-9736, Fax (530) 823-5241 12 limitation accrued when the Property closed and Plaintiff was not on title, with his full 13 knowledge (and at his request). Plaintiff’s claim that the statute tolled while he was in a 14 relationship has no merit in law or equity. Plaintiff does not even attempt to claim delayed 15 discovery based on being in love. It begs the question of whether there even was a “contract” of 16 definite terms as to when Plaintiff was to be put on title and it begs the questions of what was 17 the breach and when did the breach occurred. The Opposition argues Plaintiff right out of a 18 definitive contract by these questions. 19 Furthermore, by exhibits to the Request for Judicial Notice (“RFJN”) to the Demurrer, 20 one might assume Plaintiff was at least put on notice to request to be put on title once his tax 21 fraud was no longer pronounced. The latest date at is when he paid off the last federal tax lien in 22 February 2016. In hiding those liens from the Court, Plaintiff could not make that argument in 23 the FAC. 24 E. Plaintiff’s fraud claims are similarly time-barred. 25 For the same reasons set forth in Section D above, the three-year statute of limitations for 26 fraud is similarly time barred from April 2014, or at the latest, after the last lien was paid in 27 February 2016. 28 4 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint F. Plaintiff admits his tax fraud is a direct link to the Property title precluding 1 Plaintiff from recovery by the doctrine of unclean hands. 2 Plaintiff admits in the Opposition to committing tax fraud to avoid liens by not being on 3 title. In response to that admission in the Opposition, who cares what Plaintiff used his money 4 for instead of paying his tax liens. (Opposition p. 8:12-14.) The fact that he alleges he used the 5 money for a deposit that he is now seeking equitable recovery of, is ironic. Plaintiff claims, 6 “since each lien was subsequently release,” no harm no foul. (FAC p.8:11-15.) Perhaps that is 7 why Plaintiff withheld this information from the Court, an instead states in the FAC, “turns out, 8 there was no threat of tax liens.” (FAC ¶ 12 & 24.) That is glaringly untrue. This is a man who 9 lays his claims in equity. There is no factual finding required when Plaintiff admits to his tax 10 fraud and the Exhibits to the RFJN proves he withheld it from the Court, committing a fraud 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 11 upon the Court. Tel (530)823-9736, Fax (530) 823-5241 12 Plaintiff goes on to be so bold, “even if the court were to find Plaintiff guilty of tax fraud 13 as a matter of law…” I’m still not bad. (FAC p. 8:19-20.) He then proceeds to newly blame the 14 entire fraud on Murphy, claiming he was entrapped by the girlfriend when he removed himself 15 from title knowing he had tax liens. The FAC states Plaintiff decided not to be on title for fear 16 the tax liens would affect his interest in the Property. (FAC ¶ 12.) Rather than pay $40,000 to 17 his delinquent taxes in 2014, Plaintiff alleges he made an initial payment on the Property. 18 Plaintiff was not merely hiding from his tax debt, he made a conscience decision to put his 19 money into the Property instead of into his debt. 20 Plaintiff’s reliance on Warren v. Merrill (2006) 143 Cal.App.4th 96 (“Warren”) is 21 entirely misplaced. In Warren the buyer had poor credit and could not get a loan. His broker, in 22 his fiduciary capacity, told him that he could put the loan in the broker’s daughter’s name and 23 thereafter convinced buyer to amend the purchase agreement to put title in the broker’s 24 daughter’s name only. (Id. at 100.) Here, not only is Murphy not in a fiduciary relationship with 25 Plaintiff, as stated above, Plaintiff decided to put money into property rather than his taxes, not 26 Murphy. Additionally, no state court in the Country has cited the Second District opinion in 27 Warren and the two Ninth Circuit citations are to other issues in Warren. 28 Murphy’s reliance on Katz v. Karlsson (1948) 84 Cal.App.2d 469 should control. 5 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint 1 “Whenever a party, who, as actor, seeks to set the judicial machinery in motion and obtain some 2 remedy, has violated conscience, or good faith, or other equitable principle, in his prior conduct, 3 then the doors of the court will be shut against him, in limine; the court will refuse to interfere 4 on his behalf, to acknowledge his right, or to award him any remedy. (Id. at 474-475 7.) 5 As set forth in the moving paper, A demurrer will be sustained based on unclean hands 6 where: (1) there is supporting case law; (2) the nature of the misconduct is sufficient to support 7 the doctrine of unclean hands; and (3) the relationship between the misconduct is sufficiently 8 related to the claimed injuries. (Unilogic, Inc. v. Burroughs Corp. (1992) 10 Cal.App.4th 612, 9 619-20.) There are no factual disputes as to Plaintiff’s tax fraud. There is no dispute, in fact it is 10 admitted, that the relationship between the tax fraud and title is directly related, and there is 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 11 supporting case law. Unclean hands is ripe for decision as a matter of law. Tel (530)823-9736, Fax (530) 823-5241 12 G. Plaintiff fails to sufficiently address laches. 13 Plaintiff does not argue that laches is not applicable. He only argues that Murphy cites 14 no prejudice to assert laches. After six years, Plaintiff is claiming he is owed monies paid in 15 2014 and rents collected since 2014, plus an accounting of all expenses and income since 2014 16 on the Property, and yet states Murphy is not prejudice by the six year delay? The prejudice lies 17 in Plaintiff’s claim of damages that never existed prior to the filing of the complaint. He now 18 wants Murphy to regurgitate amounts over $100,000. The defense of Laches is evident on the 19 fact of the FAC. 20 H. Plaintiff’s fraud claim is merely conclusory to which the Opposition does not respond. 21 22 Plaintiff does not even respond to the lack of evidentiary evidence supporting fraud. 23 Without citation to authority, or rebuttal of Murphy’s authority, Plaintiff merely submits in a 24 conclusory fashion that fraud is sufficiently pleaded. The Opposition relies solely on a single 25 conclusory allegation in the FAC that Murphy had “no intention of ever adding Plaintiff on title.” 26 The FAC actually alleges this “on information and belief.” (FAC ¶24.) Contentions and 27 7 The Moving papers cite this case incorrectly as Katz v. Karlsson (1948) 84 Cal.App.2d 474. An apology is offered 28 to the Court and counsel for any delay or concern the mis-citation caused. 6 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint 1 conclusory allegations will not be deemed true where the legal sufficiency of a complaint is 2 challenged on a demurrer or motion to strike. (Serrano v. Priest (1971) 5 Cal.App.3d 584, 591.) 3 There is not a single fact in support of this information and belief that Murphy knew, at a 4 misrepresentation that it was false, or that she knew it to be false at the time of making it, nine 5 years into their twelve year relationship. Taking the Opposition on its face, Plaintiff did not 6 request to be put on title until after they broke up, which fact is not pleaded in the FAC). Even if 7 that were true, that does no allege Murphy new at the time of purchase in 2014 that she made a 8 representation she knew, at the time, to be false. 9 Even more concerning here is that lack of allegation that Murphy induced Plaintiff into 10 putting her solely on title. Quite the opposite. An action for promissory fraud may lie where a 200 Auburn Folsom Road, Suite 305, Auburn, CA 95603 11 defendant fraudulently induces the plaintiff to enter into a contract. (Lazar v. Superior Court Tel (530)823-9736, Fax (530) 823-5241 12 (1996) 12 Cal.4th 631, 638.) The FAC alleges, “MURPHY took title in her name alone because 13 Plaintiff was worried that he might have outstanding debts that could negatively impact the 14 closing and / or future ownership of the property through encumbrances.” (FAC ¶ 12.) It was 15 clearly Plaintiff’s idea to evade taxes. There is no allegation Plaintiff would have put himself on 16 title but for Murphy’s inducement. Plaintiff could not have put himself on title because the state 17 and federal government would have seized his investment to pay his taxes. Because Plaintiff 18 could not have been on title to the Property in any event, Plaintiff cannot plead detrimental 19 reliance. (Id. at 642.) All reference to punitive damages must be stricken as prayed. 20 I. The Second Cause of Action for Fraud fails for the statute of limitations. 21 For the same reasons set forth in Section H above, Plaintiff claims no reasonable 22 delayed discovery. Although the FAC is devoid of dates he requested to be put on title, he is 23 now claiming that it first occurred when Plaintiff and Murphy broke up. Why? 24 J. The Second Cause of Action for Actual Fraud is barred by unclean hands as a matter of law. 25 The Second Cause of Action is barred by unclean hands for the reasons stated above. 26 Plaintiff cannot as a matter of law claim Murphy defrauded him when he was the one 27 attempting to defraud the government. Nowhere in the FAC is it plead Murphy was complicit in 28 7 Defendant’s Reply to Plaintiff’s Opposition to Demurrer to the First Amended Complaint I Plaintiff s Fraud. 2 K. Plaintiff fails to cite authority for duty. 3 The existence of a duty is a matter of law. (KentuclE Fried Chicken of Cal., Inc. v. 4 Superior Court (1997) 14 Cal.4th 814, 819.) The FAC and Opposition rely only on a boyfriend- 5 girlfriend relationship to create a duty without a shred of support. That theory could take some 6 high schoolers aback! No California court has held that a "boyfriend-girlfriend" relationship 7 gives rise to a confidential relationship. 8 CONCLUSION 9 The Demurrer to the FAC should be sustained in full as to each cause of action jointly or c-t 10 severally without leave to amend. Plaintiff attempts to refute the remaining causes of action on \o Z (n o\ tl the same ground as distinguished above. The moving papers clearly set forth why the Demurrer I )-l u+ JN a r't tr(nI c.) l2 to each cause of action jointly and severally should be sustained without leave to amend. ,-( *= c.l r+ i-l ioo v 13 Plaintiff proffers no new facts to support the causes of action with the possible exception of a ".i = oX cc .= 14 filing a second amended complaint with the proper verification. Anything else would be deemed g t-( -l a=rt o ^\o Eca a d[*- oo\ 15 a sham pleading by judicial admission. N i-a &"\ (- C\ I trm o aO 16 Dated: October 16,2020 Respectful ly submitted, ,-- =cn ,? (n Z tro") 17 ARONOWITZ SKIDMORE LYON =F -o tV r-{ A Professional Law Corporation l8 c\ 19 KATHLEEN C. N 20 Attorney for Te Murphy 21 22 23 24 25 26 27 28 Defendant,s Reply to Plaintiffs Opposition to Demurrer to the First Amended Complaint