Cohen v. Kabbalah Ctr. Int'l, Inc.

• Decision Date: 07 May 2019
• Docket Number: B284446
• Citation: 246 Cal.Rptr.3d 774,35 Cal.App.5th 13
• Court: California Court of Appeals Court of Appeals
• Parties: Carolyn COHEN et al., Plaintiffs and Appellants, v. KABBALAH CENTRE INTERNATIONAL, INC., et al., Defendants and Respondents.

35 Cal.App.5th 13

246 Cal.Rptr.3d 774

Carolyn COHEN et al., Plaintiffs and Appellants,

v.KABBALAH CENTRE INTERNATIONAL, INC., et al., Defendants and Respondents.

B284446

Court of Appeal, Second District, Division 8, California.

Filed May 7, 2019

Law Offices of Alain V. Bonavida and Alain V. Bonavida, Beverly Hills, for Plaintiffs and Appellants.

Polsinelli LLP, Noel S. Cohen, and J. Alan Warfield, Los Angeles, for Defendants and Respondents.

WILEY, J.

Appellant Carolyn Cohen and her company Here We Grow, Inc., donated about a half million dollars to a San Diego spiritual group called Kabbalah Centre International, Inc. ("Centre"). Later Cohen wanted her money back. The trial court ruled she had no such right. We reverse one of the trial court's rulings that concerns $ 25,000 and affirm all the rest.

I

We summarize the factual record.

Centre is an organization whose members seek spiritual fulfillment. Cohen alleged Centre "holds itself out to the public as a spiritual and educational, albeit non-religious, organization dedicated to the study of Kabbalah."

Cohen joined Centre in San Diego in 2002. According to Cohen, "Some members of the Kabbalah Centre -- i.e., those they perceive to possess celebrity or personal wealth -- are given special treatment. Such members (including [Cohen]) are assigned personal teachers and counselors." Counseling sessions were "extremely intense and frequent."

Centre designated defendants Yosef Shvili, and later his wife Esther Shvili, as Cohen's spiritual guides. The Shvilis told Cohen that to receive the light and to promote her spiritual health she should "give money until it hurts." Cohen gave.

Cohen gave to two Centre causes. Her larger donation was $ 452,000 to Centre's building fund. Centre was in leased quarters. This donation was to help it buy a building that would be Centre's permanent home in San Diego. Cohen's other donation was an added $ 25,000 for Centre's "Spirituality for Kids" program. Cohen financed her donations partly through loans on a house.

Alongside other Centre members, Cohen, a real estate agent, scouted candidate buildings for Centre's future home. She visited between 12 and 75 sites. She was looking at property as late as 2011, but by 2013 Cohen concluded Centre was not truly planning to buy a building at all and was using the supposed real estate hunt only as a front for soliciting more donations.

Between 2003 and 2007, Cohen helped develop and manage Centre's "Spirituality for Kids" program. In 2007, Centre discontinued the kids program with promises to reinstate it someday, but Centre never did.

Cohen sued Centre, its affiliates, and several individuals on 10 causes of action. We refer to all defendants collectively as Centre. Pretrial motions whittled away defendants and causes of action. The trial court kept granting Cohen leave to amend her complaint until the fifth round of pleading. Then Centre filed a motion for summary judgment and summary adjudication. The trial court took supplemental briefing. After two separate oral arguments, the court granted the motion and entered judgment against Cohen.

Cohen appeals four orders in this series of rulings: the trial court's orders (1) granting summary judgment on Cohen's claims for breach of contract and (2) for fraud, and (3) the order sustaining a demurrer to the breach of fiduciary duty claim in her first amended complaint. (4) Finally, Cohen challenges the trial court order sustaining a demurrer to the Penal Code section 496 claim in her second amended complaint. We reverse the contract order in part and otherwise affirm.

II

We describe pertinent law for Cohen's first argument, which challenges the summary adjudication of her claim for breach of contract.

To win summary judgment or adjudication, a defendant must show the plaintiff cannot establish at least one element of a cause of action. ( Code Civ. Proc., § 437c, subd. (o) ; Aguilar v. Atl. Richfield Co. (2001) 25 Cal.4th 826, 853, 107 Cal.Rptr.2d 841, 24 P.3d 493.) Our review is independent. ( Id. at p. 860, 107 Cal.Rptr.2d 841, 24 P.3d 493.)

Cohen argues Centre must satisfy a more demanding standard under Probate Code section 16004, subdivision (c), which she says places the burden of proof on Centre, which in turn heightens the showing Centre must make for summary judgment. Cohen forfeited this argument when she did not make it to the trial court. ( DiCola v. White Bros. Performance Prod., Inc. (2008) 158 Cal.App.4th 666, 676, 69 Cal.Rptr.3d 888.)

The trial court properly granted summary adjudication against Cohen's contract claim concerning money Cohen donated for Centre's building (issue one in Centre's motion), but erred in adjudicating Cohen's contract claim about the $ 25,000 donation to the kids program (issue three). We treat these points in order.

A

The trial court's summary adjudication of the building fund contract claim was proper.

Cohen said she orally contracted that Centre would return her building donations if it did not use her money for a building, and Centre breached this oral contract by failing to return her donation when it decided against buying a building. The trial court properly granted summary adjudication because Cohen had no valid evidence of this contract.

To establish this contract, Cohen sought to rely on an invalid portion of her own declaration. This portion was invalid because it contradicted Cohen's own repeatedly-amended complaint. Courts properly disregard this tactic.

The tactical details are as follows.

Even after repeated demurrers, Cohen's pleading remained vague about her supposed contract with Centre. During oral argument about a demurrer on February 8, 2017, the trial court voiced concern about Cohen's vagueness.

The court sustained this demurrer. Cohen does not challenge this ruling. Cohen, however, implored the trial court for leave to file a fifth version of her complaint, promising to fix the vagueness problem. The court asked that Cohen allege the particulars of her supposed oral contract, especially "the date of the period when the conversations occurred " that Cohen claimed created the oral contract. Cohen responded: "Okay."

On March 13, 2017 Cohen filed her newly amended complaint. Paragraph 31 alleged Cohen entered an oral contract about the Centre's building fund "on or about mid-April 2004 ...."

Specifying this mid-April 2004 contract date was significant because Centre already had deposed Cohen about it.

Four days after Cohen filed her amended complaint, Centre filed a motion for summary judgment and summary adjudication on March 17, 2017. This motion took aim at Cohen's newly amended complaint. Cohen opposed this motion on May 22, 2017, but with this opposition Cohen now declared the building fund oral contract was in 2003 , not mid-April 2004.

By filing a declaration that changed the date of the building contract from 2004 to 2003, Cohen evidently hoped to avoid her past deposition admission that in 2004 she had not asked Centre to restrict its use of her donations to building construction. Cohen came up with a new story to create a factual dispute and to avoid summary judgment.

The tactic of changing one's story to avoid summary adjudication is improper. ( Castillo v. Barrera (2007) 146 Cal.App.4th 1317, 1324, 53 Cal.Rptr.3d 494 [defendants moving for summary judgment are entitled to rely on allegations in the complaint, which are judicial admissions and conclusive concessions and which frame the disputed issues].)

The point of the summary adjudication procedure is to test whether a full trial is necessary. The complaint is supposed to set forth the plaintiff's proposed case, which the defendant's summary adjudication motion then aims to test as a matter of law. But if the plaintiff's opposition moves the factual target after the defendant has fired off its motion, this unfair tactic defeats the utility of the procedure.

The trial court correctly summarized the matter: "I read her declaration very carefully. And if it was her initial statement, it might have had greater effect; but it came after her deposition was taken where she made statements that were to the contrary."

The trial court correctly disregarded Cohen's new and contradictory version of events. That left Cohen with no evidence to support her claim about an oral contract about her building fund donations, which rightly failed in the trial court and now fails on appeal. The proper adjudication of issue one in Centre's motion extinguished Cohen's claim, because Cohen could not show the existence of a contract for the return of her building fund donations.

B

The trial court erred in summarily adjudicating the kids program contract claim.

Issue three in Centre's motion attacked this claim. The trial court awarded summary adjudication in Centre's favor, but this was error because Cohen legitimately raised a material fact issue on this point.

In her deposition, Cohen testified she donated to the kids program between 2003 and 2007 and personally managed the program between 2004 to 2007. In her operative pleading, Cohen alleged she entered "another" oral contract, different from the building fund contract. This contract was that Centre would return any of Cohen's $ 25,000 donation for the Spirituality For Kids program that Centre did not use for that specific purpose. The date on this different contract was 2003. This 2003 date did not conflict with any of Cohen's previous allegations or statements. Cohen's later declaration in opposition to Centre's motion also was consistent with her pleading and her deposition.

Cohen's opposition identified and supported a genuine dispute of material fact: Cohen swore there was an oral contract for the kids program donation; Centre's witnesses swore there was no such contract. This factual clash meant it was error to grant Centre's motion to adjudicate issue three.

Centre had an alternate theory involving the statute of limitations. But Cohen correctly notes she discovered a crucial fact only in 2013, which was the...