Wilner v. Sunset Life Ins. Co.
Decision Date | 29 February 2000 |
Docket Number | No. B137561.,No. B133804.,B133804.,B137561. |
Citation | 78 Cal.App.4th 952,93 Cal.Rptr.2d 413 |
Court | California Court of Appeals Court of Appeals |
Parties | Mina WILNER, Plaintiff and Appellant, v. SUNSET LIFE INSURANCE COMPANY, Defendant and Respondent. Sunset Life Insurance Company, Petitioner, v. The Superior Court of Los Angeles County, Respondent; Mina Wilner, Real Party in Interest. |
In these related proceedings, plaintiff Mina Wilner (Wilner) appeals from an order sustaining without leave to amend a demurrer to the class action allegations of her first amended complaint.1 Defendant Sunset Life Insurance Company (Sunset) petitions for a writ commanding the superior court to sustain a demurrer to the sixth cause of action of Wilner's second amended complaint, which alleges a violation of the unfair competition law (Bus. & Prof.Code, §§ 17200-17209). We reverse the order sustaining the demurrer to the class action allegations and deny the writ petition.
Wilner originally sued Sunset and one of its agents for various forms of deceit, breach of fiduciary duty and negligence in connection with the sale to her of a universal life insurance policy as a replacement for an existing policy. She thereafter filed a first amended complaint that, in addition to the causes of action originally stated, added class action allegations and a cause of action seeking declaratory and injunctive relief. Sunset demurred. Following a hearing, the trial court sustained without leave to amend the demurrer to the class action allegations and to the fifth cause of action for breach of fiduciary duty. In all other respects, the court overruled the demurrer. Wilner thereafter filed a second amended complaint, in which she restated her various deceit and negligence claims and added a cause of action for violation of the unfair competition law (Bus. & Prof.Code, §§ 17200-17209). Sunset again demurred. The court overruled the demurrer.
Wilner contends the trial court abused its discretion in sustaining without leave to amend the demurrer to the class action allegations of her first amended complaint.
Sunset asserts the trial court abused its discretion in overruling its demurrer to the sixth cause of action, for violation of California's unfair competition law (Bus. & Prof.Code, § 17200-17209), of Wilner's second amended complaint.
Wilner contends the trial court abused its discretion in sustaining without leave to amend the demurrer to the class action allegations of her first amended complaint. We agree.
A demurrer tests the sufficiency of a complaint by raising questions of law. (Rader Co. v. Stone (1986) 178 Cal.App.3d 10, 20, 223 Cal.Rptr. 806.) In determining the merits of a demurrer, all material facts pleaded in the complaint and those that arise by reasonable implication, but not conclusions of fact or law, are deemed admitted by the demurring party. (Moore v. Conliffe (1994) 7 Cal.4th 634, 638, 29 Cal.Rptr.2d 152, 871 P.2d 204; Interinsurance Exchange v. Narula (1995) 33 Cal. App.4th 1140, 1143, 39 Cal.Rptr.2d 752.) The complaint must be construed liberally by drawing reasonable inferences from the facts pleaded. (Flynn v. Higham (1983) 149 Cal.App.3d 677, 679, 197 Cal.Rptr. 145.)
On appeal, we do not review the validity of the trial court's reasoning but only the propriety of the ruling itself. (Lee v. Bank of America (1990) 218 Cal. App.3d 914, 919, 267 Cal.Rptr. 387; May-flower Ins. Co. v. Pellegrino (1989) 212 Cal.App.3d 1326, 1332, 261 Cal.Rptr. 224.) This court is not bound by the trial court's construction of the complaint, but must make its own independent interpretation. (Rader Co. v. Stone, supra, 178 Cal.App.3d at p. 20, 223 Cal.Rptr. 806.)
It is an abuse of discretion to sustain a demurrer without leave to amend if there is a reasonable possibility any defect can be cured by amendment. (Mmsky v. City of Los Angeles (1974) 11 Cal.3d 113, 118, 113 Cal.Rptr. 102, 520 P.2d 726; Interinsurance Exchange v. Narula, supra, 33 Cal.App.4th at p. 1143, 39 Cal. Rptr.2d 752.) A demurrer may be sustained without leave to amend where the nature of the defects and previous unsuccessful attempts to plead render it probable plaintiff cannot state a cause of action. (Taliaferro v. Wampler (1954) 127 Cal.App.2d 306, 310, 273 P.2d 829.) To avoid this result, plaintiff must demonstrate how she can amend her complaint to change the legal effect of her pleading. (Goodman v. Kennedy (1976) 18 Cal.3d 335, 349, 134 Cal.Rptr. 375, 556 P.2d 737; Wade v. 20th Century Ins. Co. (1988) 206 Cal.App.3d 32, 39, 253 Cal.Rptr. 361.)
As noted in Vasquez v. Superior Court (1971) 4 Cal.3d 800, 94 Cal.Rptr. 796, 484 P.2d 964, (At p. 808, 94 Cal.Rptr. 796, 484 P.2d 964.)
There are two essential elements for maintenance of a class action: an "ascertainable class" and "a well-defined community of interest in the questions of law and fact involved." (Vasquez v. Superior Court, supra, 4 Cal.3d at p. 809, 94 Cal.Rptr. 796, 484 P.2d 964.) In order for there to be an ascertainable class, "the right of each individual to recover may not be based on a separate set of facts applicable only to him." (Ibid., fn. omitted.) Community of interest (Ibid.)
Wilner alleges that she is bringing the action "on behalf of all persons and/or entities residing in California who have (or had at the time of the policy's termination) an ownership interest in one or more permanent[, or universal,] life insurance policies that were issued by [Sunset] ... which were purchased as a result of deceptive or fraudulent sales practices described herein from January 1, 1985 to the present ... and were thereby harmed...." This describes the class sufficiently to make it ascertainable. (Vasquez v. Superior Court, supra, 4 Cal.3d at pp. 810-811, 94 Cal.Rptr. 796, 484 P.2d 964.)
To establish successfully a community of interest in this case, plaintiff must demonstrate that Sunset "made false representations with knowledge of their falsity, that these representations were made with intent to and did induce reasonable reliance by plaintiff[ ], and that plaintiff[ ] suffered damages as a result." (Vasquez v. Superior Court, supra, 4 Cal.3d at p. 811, 94 Cal.Rptr. 796, 484 P.2d 964.) As did the defendant in Vasquez, Sunset argues (Ibid.) As the Supreme court noted in Vasquez, however, that the transaction between Sunset and each class member was consummated separately "is not determinative so long as each class member will not be required to litigate numerous and substantial issues to establish [that member's] individual right to recover." (Ibid.)
Wilner alleges that Sunset, through its agents, "engaged in a common course of conduct designed to induce thousands of [its] existing and prospective policyholders to purchase `replacement' or `financed' life insurance policies for [it] by using the cash value of ... existing policies, by surrendering, borrowing or stripping such cash or cumulative value for the purchase of new policies [Sunset] issued." It "developed and...
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