Pierce v. Silverston & Associates

Filed 5/7/08 Pierce v. Silverston & Associates CA2/3

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

SECOND APPELLATE DISTRICT

DIVISION THREE

APPEAL from a judgment of the Superior Court of Los Angeles County,

Allan J. Goodman, Judge. Reversed.

Pierce & Weiss and Eric A. Forstrom for Plaintiffs and Appellants.

Fuchs & Associates, Inc., John R. Fuchs and Gail S. Gilfillan for Defendants and Respondents.

_________________________

David and Ilysia Pierce (the Pierces) appeal the judgment of dismissal entered after the trial court sustained the demurrer of defendants Silverston and Associates, Inc., Gary Silverston and Diana Morton, aka, Diana Silverston, to the negligence cause of action in the Pierces second amended construction defect complaint without leave to amend. We reverse and remand for further proceedings.

FACTUAL AND PROCEDURAL BACKGROUND

1. Construction and sale of the residence; the Pierces initiate litigation.

In 1998, Fiorella Urbinati contracted with Silverstein and Associates, Inc., Gary Silverston and Diana Morton (the builders) to construct a single family residence in Brentwood, California. On June 14, 2004, Urbinati sold the residence to the Pierces. On June 19, 2006, the Pierces sued Urbinati and the builders for construction defects in the home.

2. The first amended complaint.

On September 11, 2006, the Pierces filed a first amended complaint (FAC) after the trial court sustained Urbinatis demurrer to the complaint. The FAC alleged fraud as to Urbinati and alleged negligence as to Urbinati and the builders. The negligence cause of action in the FAC alleged that, based on a preliminary inspection of the premises, the Pierces had discovered [d]efects in the planning, development, design, engineering, supervision, construction, installation, manufacturing and materials in the subject property, and consequential and resulting damages therefrom. Such defects and damages include, but are not limited to, deteriorated siding; use of single pane windows without requisite window coverings; leaking windows; leaking roofs; fungal growth; defective retaining walls; masonry cracking; interior drywall cracks; deteriorated cabinets; voided roof warranty and other sheet metal defects and general substandard construction.

The FAC alleged negligence based on the asserted duty to design, build, manufacture, modify, advertise, sell and to resell the subject property in a manner free of defects, and in a workmanlike manner, and in compliance with any approved and required plans or specifications, and/or industry standards, properly following the applicable standard of care in the industry, [the California] Uniform Building Code, and other applicable standards required of owners/builders, contractors.

The Pierces asserted they had been damaged by being required to pay for property damage, property replacement, mold remediation and additional expenses for the loss of use of portions of the subject property during those repairs and remediation, and including litigation costs, loss of use, expenses, contractors fees and consultants fees to inspect, repair, remediate and mitigate damages incurred or to be incurred . . . in the prosecution of this action, all in [an] amount to be determined at trial, but in excess of $500,000.

3. The defendants demurrer to the FAC.

Urbinati and the builders demurred to the FAC. The builders argued the FAC contained a vague list of defects and general allegations that was insufficient to give notice of the facts on which liability was being asserted. The builders claimed the allegations of the FAC intentionally were vague to avoid defenses that otherwise could be applied at the pleading stage such as the four-year statute of limitations for patent construction defects. (Code Civ. Proc., 337.1.)^[1] Further, the Pierces failed to specify how they had suffered damages in excess of $500,000. The demurrer noted the FAC alleged the builders had been involved in the sale of the residence. However, the sales contract, which was attached to the FAC, identified Urbinati as the seller. The builders requested their demurrers^[2]be sustained without leave to amend unless the Pierces demonstrated they could amend the FAC to allege the basis for liability with specificity.

4. The trial court sustains the builders demurrers with leave to amend.

On December 6, 2006, the Pierces counsel attempted to continue the hearing on the builders demurrers pursuant to a stipulation. The trial court declined to continue the matter and conducted a hearing on the demurrers.^[3] Plaintiffs counsel argued the FAC properly alleged breach of the duty to build a home free of defects. The trial court sustained the demurrers with leave to amend and instructed the Pierces to be more specific.

5. The second amended complaint.

On December 22, 2006, the Pierces filed a second amended complaint (SAC). The cause of action for negligence in the SAC alleged Urbinati and the builders had a duty to design, build, manufacture, modify, advertise, sell and resell the Subject Property in a manner free of defects, and in a workmanlike manner, and in compliance with any approved and required plans or specifications, and/or industry standards, properly following the applicable standard of care in the industry, the California Uniform Building Code, and other applicable standards required of owners/builders, contractors and sellers of property.

The SAC alleged Urbinatis 1998 contract with the builders was for a specific scope of work from foundation up through drywall, exterior siding, windows, roof, sheet metal, and exterior decks, including waterproofing. After that portion of the work was complete, URBINATI was to finish the remaining construction, including all interior finishes, final grading and site work, and flat work. The plaintiffs alleged the defendants breached their respective duties because the residence contained latent defects within the scopes of work described, and identified in paragraph 14 herein above, proximately causing consequential and resulting property and other damage . . . . Paragraph 14 states: Based upon the preliminary results of PLAINTIFFS[] inventory, observation, inspection and investigation PLAINTIFFS have discovered the following defects in the planning, development, design, engineering, supervision, construction, installation, manufacturing and materials . . . : [] a) improper grading; [] b) insufficient under floor ventilation; [] c) deteriorated siding; [] d) use of single pane windows without requisite window coverings; [] e) leaking windows; [] f) leaking decks; [] g) leaking roof; [] h) fungal growth at the interior of the home; [] i) overburdened and insufficient retaining walls; [] j) masonry cracking; [] k) improper stove top design; [] l) improper design and/or installation of marble; [] m) interior drywall cracks; [] n) deteriorated cabinets; [] o) improper installation of roofing, resulting in a voided roof warranty and other sheet metal defect; and [] p) miscellaneous and substandard construction, including various violations of the California Uniform Building Code and National Electrical Code.

The SAC further alleged that, by reason of the negligence of the defendants, plaintiffs have been damaged by being required to pay for property damage, property replacement, mold remediation and additional expenses for the loss of use of portions of the Subject Property during those repairs and remediation, and including litigation costs, loss of use, expenses, contractors fees and consultants fees to inspect, repair, remediate and mitigate damages incurred or to be incurred . . . in [the] amount to be determined at trial, but in excess of $500,000.

6. The trial court sustains the builders demurrer without leave to amend.

The builders demurred to the cause of action for negligence in the SAC on the same grounds they previously had asserted. Urbinati also demurred to the SAC. The Pierces filed opposition which claimed the SAC adequately stated a cause of action for negligence.

At the hearing on the demurrers, the Pierces counsel argued that negligence need only be pleaded generally. The trial court found the cause of action for negligence remained uncertain and, even in the opposition to the demurrer, the Pierces failed to suggest how the cause of action for negligence might be amended to cure the defects. The trial court sustained the builders demurrer without leave to amend and thereafter dismissed the matter as to the builders.

DISCUSSION

1. General principles.

In reviewing the sufficiency of a complaint against a general demurrer, we assume the truth of all facts properly pleaded and review the complaint de novo to determine whether it states facts sufficient to state a cause of action. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318; Breneric Associates v. City of Del Mar (1998) 69 Cal.App.4th 166, 180.)

It is well settled that [n]egligence may be alleged in general terms. (Miller v. Pacific Constructors, Inc. (1945) 68 Cal.App.2d 529, 539.) [A] plaintiff is required only to set forth the essential facts of his case with reasonable precision and with particularity sufficient to acquaint a defendant with the nature, source and extent of his cause of action. (Youngman v. Nevada Irrigation Dist. (1969) 70 Cal.2d 240, 245.) The particularity required in pleading facts depends on the extent to which the defendant in fairness needs detailed information that can be conveniently provided by the plaintiff; less particularity is required where the defendant may be assumed to have knowledge of the facts equal to that possessed by the plaintiff. [Citation.] (Jackson v. Pasadena City School Dist. (1963) 59 Cal.2d 876, 879.) There is no need to require specificity in the pleadings because modern discovery procedures necessarily affect the amount of detail that should be required in a pleading. [Citation.] (Ludgate Ins. Co. v. Lockheed Martin Corp. (2000) 82 Cal.App.4th 592, 608.)

With these principles in mind, we turn to the issue presented.

2. The SAC adequately states a cause of action for negligence.

In this case, the SAC identifies the scope of the work performed by the builders pursuant to the contract and alleges the builders had a duty to design, build and manufacture the residence in a manner free of defects, and in a workmanlike manner, and in compliance with any approved and required plans or specifications, and/or industry standards . . . . The SAC alleges breach of this duty by failing to construct the residence in a reasonable and workmanlike manner and according to industry standards . . . . The SAC alleges the builders breached these duties resulting in latent defects including interior drywall cracks, leaking windows, fungal growth at the interior of the home, leaking roof and leaking decks.

With respect to damages, the SAC alleges that, as a result of the builders breach of their duty, the Pierces suffered damages in that they have been required to pay for property damage and mold remediation, they have replaced certain property, they have incurred expenses relating to the loss of use of the home, litigation, consultants fees and contractors fees, and they will incur other costs in the prosecution of the lawsuit. The SAC also alleges the Pierces will be required to incur expenses to evaluate, correct, replace and reconstruct defective improvements and damages to the Subject Property . . . , all in a sum to be determined according to proof at the time of trial.

We conclude the SAC identifies the scope of the work done by the builders, the various defects in the work and their resulting damages. Moreover, because the builders are more familiar with the work they performed on the property than the plaintiffs, the plaintiffs properly may plead negligence in general terms. (Smith v. Beauchamp (1945) 71 Cal.App.2d 250, 254-255.) Thus, the SAC was sufficient to withstand the builders demurrer.

3. The builders arguments to the contrary are not persuasive.

Citing Aas v. Superior Court (2000) 24 Cal.4th 627, 646, the builders claim the SAC fails to allege damage to property or involuntary out-of-pocket losses. However, in Aas the construction defects had not yet caused property damage. Consequently, the plaintiff was unable to allege appreciable, nonspeculative, present injury, which is a fundamental prerequisite to a tort claim. (Id. at p. 646.) In this case, the SAC alleges property damage and out of pocket expenses incurred in remedial efforts. Thus, Aas does not assist the builders.

The builders also rely on the rule that, where the facts pleaded disclose that a cause of action is time-barred, the plaintiff must plead facts that demonstrate the discovery rule prevents application of the statute of limitations. Thus, where a cause of action is barred on the face of a complaint, the plaintiff must plead facts showing (1) the time and manner of discovery and (2) the inability to have made earlier discovery despite reasonable diligence. (See CAMSI IV v. Hunter Technology Corp. (1991) 230 Cal.App.3d 1525, 1536; Iverson, Yoakum, Papiano & Hatch v. Berwald (1999) 76 Cal.App.4th 990, 995.)

Applying this rule, the builders contend the SAC alleges the residence was constructed approximately eight years prior to the filing of the lawsuit. Thus, according to the builders, many of the claimed defects, such as deteriorated siding, masonry cracking and deteriorated cabinets, are barred by the four-year statute of limitations applicable to patent construction defects. (Code Civ. Proc., 337.1.) Based thereon, the builders argue the SAC must plead specific facts either showing that the defects are latent or that there is a legal basis to avoid the four-year statute of limitations.

This argument fails because Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 638, the case cited by the builders for the proposition that defective siding is a patent defect and therefore subject to a four-year statute of limitations, in fact, held defective siding is a latent defect. (Id. at p. 645.) Thus, at the pleading stage of this case, the absolute 10-year statute of limitations of Code of Civil Procedure section 337.15^[4]applies until the defect is sufficiently appreciable . . . to put [the plaintiffs] on notice to pursue their remedies, and consequently to start the . . . four-year statute[] of limitation to run. (Mills v. Forestex Co., supra, at p. 650; North Coast Business Park v. Nielsen Construction Co. (1993) 17 Cal.App.4th 22, 27.)

Here, because the vast majority of the defects claimed in the SAC are latent, it does not appear on the face of the SAC that the cause of action for negligence is barred by the statute of limitations. The running of the statute must appear clearly and affirmatively from the dates alleged; it is not enough that the complaint may be time-barred. (Marshall v. Gibson, Dunn & Crutcher (1995) 37 Cal.App.4th 1397, 1403.)

The builders reliance on Lantzy v. Centex Homes (2003) 31 Cal.4th 363, 374, in this connection also is misplaced. In Lantzy, the complaint was filed more than 10 years after substantial completion of the construction project. Thus, on the face of the complaint, the allegations of negligence were barred.

In sum, reasonably construing the allegations of the SAC, we conclude the Pierces have alleged that latent defects caused property damage to the residence. Whether the alleged defects were patent or should have been discovered sooner are factual matters that cannot be resolved on demurrer.

4. Conclusion.

We conclude the SAC adequately stated a cause of action for negligence. We therefore reverse the judgment of dismissal and remand for further proceedings.^[5]

DISPOSITION

The judgment in favor of defendants Silverston and Associates, Inc., Gary Silverston and Diana Morton, aka, Diana Silverston is reversed. Each party to bear its own costs on appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

KLEIN, P. J.

We concur:

CROSKEY, J.

ALDRICH, J.

Publication Courtesy of California lawyer directory.

Analysis and review provided by Escondido Property line Lawyers.

San Diego Case Information provided by www.fearnotlaw.com

^[1] Code of Civil Procedure section 337.1 states in part: (a) Except as otherwise provided in this section, no action shall be brought to recover damages from any person performing . . . the . . . construction of an improvement to real property more than four years after the substantial completion of such improvement for any of the following: (1) Any patent deficiency in the . . . construction of an improvement to . . . real property; [] (2) Injury to property, real or personal, arising out of any such patent deficiency; or [] . . . [] (e) As used in this section, patent deficiency means a deficiency which is apparent by reasonable inspection.

^[2] Diana Morton filed a separate demurrer to the FAC.

^[3] The minute order filed with respect to the hearing on the demurrers notes the stipulation to continue the hearing was not received until after the hearing.

^[4] Code of Civil Procedure section 337.15 provides in relevant part: No action may be brought to recover damages from any person, or the surety of a person, who develops real property or performs or furnishes the design, specifications, surveying, planning, supervision, testing, or observation of construction or construction of an improvement to real property more than 10 years after the substantial completion of the development or improvement for any of the following: [] (1) Any latent deficiency in the design, specification, surveying, planning, supervision, or observation of construction or construction of an improvement to, or survey of, real property. [] (2) Injury to property, real or personal, arising out of any such latent deficiency. [] (b) As used in this section, latent deficiency means a deficiency which is not apparent by reasonable inspection.

^[5] The builders request that this court take judicial notice of the fact that David Pierce is a partner in a law firm that handles construction defect cases. (See Royal Surplus Lines Insurance, Co. v. Yi (Dec. 30, 2003, B164999) [nonpub. opn.]; Franciscan Hill Homeowners Assoc. v. Newhall Land and Farming Co. (Dec. 30, 2003, B139859) [nonpub. opn.].) Thus, David Pierce is experienced in construction defect disputes and should know how to plead a claim of negligence against contractor defendants. Because we conclude the SAC adequately stated a cause of action for negligence, we decline the builders request for judicial notice.