Demin v. Shamsian

Filed 10/2/08 Demin v. Shamsian CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

Appeal from a judgment of the Superior Court of Orange County, Gregory H. Lewis, Judge. Affirmed.

Jeffrey B. McMillen for Plaintiff and Appellant.

Robinson & Robinson, Jeffrey A. Robinson; Rutan & Tucker, Treg A. Julander for Defendant and Respondent.

Ali Demin sued Aliakbar Shamsian for fraud. Shamsians motion for summary judgment was granted on the grounds the three‑year statute of limitations applicable to a fraud cause of action (Code Civ. Proc.,  338, subd. (d))[1] had expired. Demin contends there was a material issue of fact as to whether he knew or should have known about Shamsians alleged wrongdoing more than three years prior to filing his complaint. We reject his contention and affirm the judgment.

FACTS

1. Complaint and Default Judgment

Demin, a resident of England, filed his fraud complaint against Shamsian on May 19, 2004. Demin alleged that in 1999, Shamsian, who had been his close friend and financial adviser for many years (they had known each other since the early 1970s when both lived in Iran), advised him how to invest his money to avoid paying taxes. Shamsian told Demin to transfer his funds to a bank account in Luxembourg belonging to a man named Aliakbar Rad, over which Shamsian represented he had no power or control. The money would remain in Rads account for some period of time and then all funds would be returned to Demin upon his request with 20 percent annual interest free of British taxes. In July 1999, Demin transferred over $750,000 into Rads bank account. When Demin subsequently asked for the return of his money, Shamsian gave him various excuses as to why the funds were unavailable. Demins complaint alleged he did not learn that Shamsian had fraudulently taken all his money until on or about December 8, 2001.

In January 2005, Demin obtained a default judgment against Shamsian for $1,158,141.98. In June 2006, Shamsian succeeded in having the default judgment set aside and he answered the complaint.

2. Summary Judgment Motion

Shamsian filed a motion for summary judgment on the grounds the three‑year statute of limitations applicable to a fraud cause of action had expired. He asserted Demin was put on notice of his cause of action as early as March 2000 when he asked Shamsian to return all his funds and he did not return the money.

Shamsians motion was supported by Demins December 28, 2004, declaration filed in support of the default judgment, and Demins May 2006 declaration filed in opposition to the motion to set aside the earlier default judgment. In the first declaration, Demin stated that early in the year 2000, he asked Shamsian for all the money he had transferred to the Luxembourg account. The money was not returned, and after that, every time Demin asked Shamsian for his money, Shamsian had some excuse as to why Rad was unavailable to access the bank account so as to transfer Demins money back to him. After several weeks of pressur[ing] Shamsian to get his money, Shamsian told Demin that Rad had died unexpectedly in Iran and the funds in his bank account could not be accessed until 40 days passed (the traditional mourning period in Islamic countries). When the 40 days passed, Shamsian told Demin he must wait until Rads will went through probate.

By June 2000, Demin was still asking Shamsian for his money, and Shamsian became very angry with him. Shamsian wrote Demin a letter saying that while Shamsian wanted to help Demin get his money back, he could not disturb Rads grieving widow. Shamsian instructed Demin he should get legal assistance in preparing an indemnification letter so Shamsian would not incur legal liability for accessing the joint account . . . .

In August 2000, Demin and his wife went to Amsterdam and met with Shamsian and a friend of Demins from Iran, Reza Montevalian. Demins declaration stated the purpose of the meeting was to ask Shamsian to return Demins money to him. Shamsian indicated he was going to Iran soon and would do his best to get Demins money from Rads bank account. In September 2000, Shamsian went to visit Montevalian and Demins brother in Iran. When Montevalian suggested the three go visit Rads widow to offer their condolences, Shamsian became very angry and left [Montevalians] house in a temper . . . . Demin declared that [a]t this point, [he] suddenly became suspicious, as []Shamsians behavior and reaction was very abnormal and unwarranted. Montevalian and Demins brother started investigating and in September 2000 told Demin they found no records of Rads death or burial in Tehrans main cemetery.

In the fall of 2001, Demin learned Rad was not dead, and he was living in Tehran. When Demin finally spoke with Rad, Rad explained the Luxembourg bank account to which Demin had transferred his funds was a joint account owned by Rad and Shamsian, and Shamsian had withdrawn the funds within days of Demins original deposit. Demin claimed [t]his was really the time that I discovered []Shamsian had perpetrated a fraud upon me.

Shamsian also submitted his own declaration explaining he was in the business of representing manufacturers in selling products to various Iranian government agencies. Demin had a network of family and friends living in Iran who assisted Shamsian and who were paid commissions on sales. Shamsian frequently advanced money to Demin to be used to pay these commissions. Money Demin transferred to the Luxembourg account was a refund by Demin of unpaid commission advances after Shamsian ceased doing business in Iran.

In November 2000, Demins attorney in London, Lynne Brooke, wrote to Shamsian directing him to remit $750,000 to Demin no later than November 30, 2000. On December 1, 2000, Demins attorney wrote to Shamsian asking him to confirm that the money would be transferred. Copies of the two letters were attached to Shamsians declaration.

In opposition to the summary judgment motion, Demin submitted a third declaration stating it was not until January 5, 2002, when he confronted Shamsian that he understood he had been defrauded. Prior to that time, Demin had believed Shamsians various excuses as to why his money could not be accessed. Demin stated the November 2000 letter to Shamsian from Brooke, was not a collection matter. Rather, Demin expected Shamsian would transfer the $750,000 to him soon, and Demin wanted that money remitted to his attorney so it could be transferred into a Malta trust account the attorney was setting up for him.

Brooke submitted his declaration confirming he sent letters to Shamsian on Demins behalf on November 2, 2000, and December 1, 2000, directing Shamsian as to where to transfer the money. Brooke stated the letters were not intended as a debt collection process. No response was ever received from Shamsian.

Demin also submitted a declaration from Montevalian. He confirmed that in 2000 he met with Shamsian in Iran, and Shamsian became very angry when Montevalian suggested they go together to visit Rads widow. Montevalian declared he immediately became suspicious of Shamsian, but denied he ever conveyed his suspicions to Demin.

3. Ruling

The trial court granted Shamsians motion for summary judgment and entered judgment in his favor. In its ruling, the court stated Demin had information as early as September 2000 that would have put a reasonable person on inquiry of Shamsians alleged wrongdoing.

DISCUSSION

Demin contends the trial court erred in granting Shamsians motion for summary judgment. We disagree.

1. Summary Judgment Standard of Review

Summary judgment is properly granted when there is no triable issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law. ( 437c, subd. (c).) A defendant seeking summary judgment bears the initial burden of proving the cause of action has no merit by showing that one or more elements of plaintiffs cause of action cannot be established or there is a complete defense. [Citations.] Once the defendants burden is met, the burden shifts to the plaintiff to show that a triable issue of fact exists as to that cause of action. [Citation.] (Horn v. Cushman & Wakefield Western, Inc. (1999) 72 Cal.App.4th 798, 805.)

On appeal, we review the record de novo to determine whether the moving party met its burden of proof. [Citations.] But this de novo review does not obligate us to cull the record for the benefit of the appellant in order to attempt to uncover the requisite triable issues. As with an appeal from any judgment, it is the appellants responsibility to affirmatively demonstrate error and, therefore, to point out the triable issues the appellant claims are present by citation to the record and any supporting authority. In other words, review is limited to issues which have been adequately raised and briefed. [Citations.] (Lewis v. County of Sacramento (2001) 93 Cal.App.4th 107, 116; see also Claudio v. Regents of University of California (2005) 134 Cal.App.4th 224, 230.)

2. Statute of Limitations

Demin agrees his complaint is governed by the three‑year statute of limitations contained in section 338, subdivision (d). Under that section, the cause of action accrues upon the discovery, by the aggrieved party, of the facts constituting the fraud. . . .  The statute of limitations commences when the plaintiff suspected or should have suspected that an injury was caused by wrongdoing. (Kline v. Turner (2001) 87 Cal.App.4th 1369, 1374 (Kline); see also Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1110‑1111 (Jolly).) The knowledge element exists when the plaintiff has notice or information of circumstances to put a reasonable person on inquiry, or has the opportunity to obtain knowledge from sources open to [her] investigation (such as public records or corporation books) . . . . [Citation.] (Kline, supra, 87 Cal.App.4th at p. 1374; see also Parsons v. Tickner (1995) 31 Cal.App.4th 1513, 1525.) In applying this rule, the term wrongdoing is construed as a layperson understands it. (Kline, supra, 87 Cal.App.4th at p. 1374; see also Jolly, supra, 44 Cal.3d at p. 1110, fn. 7.) The accrual of a fraud cause of action generally presents a question of fact, but it may be resolved by a summary judgment motion when the uncontradicted facts are susceptible of only one legitimate inference . . . . (Kline, supra, 87 Cal.App.4th at p. 1374; Jolly, supra, 44 Cal.3d at p. 1112.)

The trial court correctly concluded Demins action was time‑barred. The only legitimate inference that may be drawn from the uncontroverted facts is that a reasonable person in Demins position would have been put on notice of Shamsians alleged wrongdoing by the end of the year 2000. Demins complaint was filed more than three years later in May 2004.

In his own declarations, Demin stated he first asked Shamsian to return all of his money in early 2000. The money was not returned. Demin kept asking Shamsian for his money, and Shamsian always had some excuse. By June 2000, when Demin was still asking Shamsian for his money, Shamsian became angry and wrote Demin a letter indicating he could not disturb Rads widow to get the money back at that time. In August 2000, Demin met with Shamsian again asking about the return of his money and Shamsian indicated he would try to help get it back from Rads widow. In September 2000, Demin learned from his brother and Montevalian that Shamsian became very angry with them upon Montevalian suggesting the three men go see Rads widow and Shamsian stormed out. Demin specifically declared that At this point, [he] suddenly became suspicious of Shamsian. He learned from Montevalian later that month there was no record of Rads death or burial at Tehrans main cemetery. In November 2000, Demins attorney wrote to Shamsian directing him to remit the $750,000 to Demin no later than November 30, 2000. No response (or money) was ever received from Shamsian.

Demin protests the trial court improperly weighed the credibility of Demins above‑described admissions contained in his two declarations against other assertions of fact he made. Specifically, he notes his complaint alleged he did not learn of Shamsians fraud until on or about December 8, 2001, and in his declaration filed in opposition to the summary judgment motion, he stated Shamsians incessant lies prevented him from discovering the wrongdoing until January 2002. But a party cannot rely on its own pleadings as evidence to support or oppose a summary judgment motion. [Citations.] (Cassady v. Morgan, Lewis & Bockius LLP (2006) 145 Cal.App.4th 220, 241.) And Demin is bound by the admissions made in his declarations. (See Thompson v. Williams (1989) 211 Cal.App.3d 566, 573 [[A] party cannot rely on contradictions in his own testimony to create a triable issue of fact].)

Finally, Demin argues that even though he had suspicions about Shamsian in the summer of 2000, it was only suspicio[n] of conduct on that specific occasion, not suspicion of wrongdoing. Demins lack of subjective knowledge of Shamsians fraud is not decisive. The discovery rule is not purely subjectiveit has an objective component as well. The words plaintiff . . . should suspect refer to an objective test requiring a showing that a reasonable person would have suspected the injury was caused by wrongdoing. [Citation.] (Kitzig v. Nordquist (2000) 81 Cal.App.4th 1384, 1391.) The facts known to Demin in 2000 were such that any reasonable person would have suspected wrongdoing.

DISPOSITION

The judgment is affirmed. Respondent is awarded his costs on appeal.

OLEARY, J.

WE CONCUR:

RYLAARSDAM, ACTING P. J.

ARONSON, J.

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[1] All further statutory references are to the Code of Civil Procedure.