Hasbun v. O'Connor CA2/7 ( 2021 )

Filed 3/16/21 Hasbun v. O’Connor CA2/7
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for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 SEVEN
SALEH HASBUN, B299648
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. PC058689)
v.
GARY O’CONNOR, individually
and as Trustee, etc.,
Defendants and
Respondents.
APPEAL from judgment of the Superior Court of
Los Angeles County, Melvin Sandvig, Judge. Affirmed.
Law Offices of John S. Nagle, John Nagle and Robert A.
Brown for Plaintiff and Appellant.
Law Offices of Michael Welch and Michael Welch for
Defendants and Respondents.
__________________________
Saleh Hasbun sued Gary O’Connor individually and as
trustee of the Money Market Retirement Trust Dated 1-94
(collectively “O’Connor”) alleging financial abuse, physical abuse
and intentional infliction of emotional distress in violation of the
Elder Abuse and Dependent Adult Civil Protection Act (Elder
Abuse Act or Act) (Welf. & Inst. Code, § 15600 et seq.) and breach
of fiduciary duty. The trial court sustained O’Connor’s demurrer
to the complaint, ruling Hasbun lacked standing to sue for
financial elder abuse, his causes of action for physical and
emotional distress elder abuse were untimely and he failed to
allege a factual basis for finding a fiduciary relationship existed
with O’Connor.
Hasbun argues on appeal from the judgment of dismissal
that the Elder Abuse Act applies to the taking of property
indirectly owned by an elder; a three-year, not two-year, statute
of limitations applies to physical and emotional distress elder
abuse claims; and the complaint alleges facts sufficient to
establish that O’Connor owed Hasbun a fiduciary duty. Hasbun
also requests leave to amend his causes of action for physical and
emotional distress elder abuse if we conclude, as did the trial
court, a two-year statute of limitations applies to those claims.
We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
1. Hasbun’s Complaint for Elder Abuse and Breach of
Fiduciary Duty
In a complaint filed August 1, 2018, Hasbun alleged he was
over the age of 65 and had suffered several strokes that affected
his mental abilities and general health. O’Connor was a
“sophisticated real estate licensed broker and or agent and an
investor for over twenty years in real estate in Southern
2
California” and the trustee of the Money Market Retirement
Trust dated 1-94.
Hasbun through Boostz, Inc., a California-based
subchapter S corporation he owns, and O’Connor invested money
as lenders and held secured interests in two real properties in
Los Angeles. Other unnamed investors also held secured
interests in the properties. In 2011 the investors foreclosed on
unpaid notes and acquired the properties. Hasbun alleged
O’Connor had collected more than $100,000 in rental income from
the properties over a period beginning sometime prior to 2011
and had refused to pay Boostz its share of rental income or to
provide an accounting for the rents he had collected.
According to Hasbun’s complaint, in 2014 and 2015
O’Connor found parties interested in buying the properties for a
sum in excess of $1 million. By this time O’Connor had bought
out most of the other investors and owned more than 90 percent
of the properties; Boostz owned a 4.2 percent interest. O’Connor
began negotiations to acquire the interests of the other investors;
those efforts were ultimately unsuccessful. “Enraged” when he
was unable to purchase the interests of the other investors, in
October or November 2015 O’Connor began stalking and
harassing Hasbun. “[A]fter weeks of stalking” O’Connor
assaulted Hasbun at his office and “screamed” at Hasbun for
30 minutes while “towering over him and threatening to have
him beat up.”
Based on these allegations Hasbun asserted claims against
O’Connor for violations of the Elder Abuse Act and breach of
fiduciary duty.
3
2. O’Connor’s Demurrer and the Trial Court’s Order
O’Connor demurred to the complaint. O’Connor argued,
because a cause of action for financial elder abuse requires the
“real or personal property of an elder” be wrongfully taken or
retained (see Welf. & Inst. Code, § 15610.30, subd. (a)(1)) and the
complaint alleged Boostz, not Hasbun, owned the interest in the
properties, Hasbun’s claim for financial elder abuse failed as a
matter of law. Hasbun had not, and could not, allege any
property belonging to him had been wrongfully taken by
O’Connor. As to Hasbun’s physical and emotional distress elder
abuse claims, O’Connor argued the two-year statute of
limitations for personal injuries in Code of Civil Procedure
1
section 335.1 applied and barred the claims. Lastly, O’Connor
asserted Hasbun’s cause of action for breach of fiduciary duty
failed because the complaint alleged insufficient facts to support
the existence of a fiduciary relationship between the two men.
In his opposition papers Hasbun contended the Elder
Abuse Act applied to deprivations of property held indirectly, as
well as directly, by an individual 65 years or older. He also
argued the three-year limitations period in section 338,
subdivision (a), for liabilities created by statute applied to his
claims for physical abuse and intentional infliction of emotional
distress under the Elder Abuse Act. Finally, Hasbun claimed
O’Connor owed him fiduciary duties because they were co-owners
and joint investors in real property. Hasbun requested leave to
amend his complaint to address any deficiencies that might be
found by the court.
1
Statutory references are to this code unless otherwise
stated.
4
The trial court sustained O’Connor’s demurrer following a
hearing on May 31, 2019. The court agreed with O’Connor that,
because Hasbun had alleged a corporation owned the interests in
the properties, Hasbun could not state facts sufficient to
constitute a cause of action for financial elder abuse. Similarly,
Hasbun’s cause of action for breach of fiduciary duty failed
because the corporation owned the property interests and there
was no co-ownership or joint investor relationship between
Hasbun and O’Connor. The demurrer to these claims was
sustained without leave to amend. The court also held
section 335.1’s two-year limitations period barred Hasbun’s
physical and emotional distress elder abuse claims. The minute
order from the May 31, 2019 hearing notes Hasbun requested
leave to amend to allege conduct by O’Connor that occurred
through August 2016 and plainly indicated, but did not expressly
2
state, that leave to amend had been granted.
The court entered a judgment of dismissal on June 28, 2019
having sustained the demurrer and “plaintiff electing not to
amend” his claims for physical and emotional distress elder
abuse. Hasbun timely appealed.
2
The minute order also continued the case management
conference from June 19, 2019 to September 12, 2019. There
would be no reason for a case management conference to remain
on calendar if the demurrer had been sustained without leave to
amend in its entirety. To the extent Hasbun was uncertain
whether he was authorized to amend the causes of action for
physical and emotional distress elder abuse, it was his
responsibility to seek clarification from the trial court before his
time to amend expired.
5
DISCUSSION
1. Standard of Review
A demurrer tests the legal sufficiency of the factual
allegations in a complaint. We independently review the trial
court’s ruling on a demurrer and determine de novo whether the
pleading alleges facts sufficient to state a cause of action or
discloses a complete defense. (Mathews v. Becerra (2019)
8 Cal.5th 756, 768; T.H. v. Novartis Pharmaceuticals Corp. (2017)
4 Cal.5th 145, 162.) We assume the truth of the properly pleaded
factual allegations, facts that reasonably can be inferred from
those expressly pleaded and matters of which judicial notice has
been taken. (Evans v. City of Berkeley (2006) 38 Cal.4th 1, 20;
Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.)
However, we are not required to accept the truth of the legal
conclusions pleaded in the complaint. (Mathews, at p. 768; Zelig
v. County of Los Angeles (2002) 27 Cal.4th 1112, 1126.) We
liberally construe the pleading with a view to substantial justice
between the parties. (§ 452; Ivanoff v. Bank of America, N.A.
(2017) 9 Cal.App.5th 719, 726; see Schifando, at p. 1081
[complaint must be read in context and given a reasonable
interpretation].)
“‘Where the complaint is defective, “[i]n the furtherance of
justice great liberality should be exercised in permitting a
plaintiff to amend his [or her] complaint.”’” (Aubry v. Tri-City
Hospital Dist. (1992) 2 Cal.4th 962, 970-971.) We determine
whether the plaintiff has shown “in what manner he [or she] can
amend [the] complaint and how that amendment will change the
legal effect of [the] pleading.” (Goodman v. Kennedy (1976)
18 Cal.3d 335, 349.) “[L]eave to amend should not be granted
where . . . amendment would be futile.” (Vaillette v. Fireman’s
6
Fund Ins. Co. (1993) 18 Cal.App.4th 680, 685; see generally
Ivanoff v. Bank of America, N.A., supra, 9 Cal.App.5th at p. 726;
Graham v. Bank of America, N.A. (2014) 226 Cal.App.4th 594,
618 [the burden of proving a reasonable possibility that the
complaint’s defects can be cured by amendment “‘“is squarely on
the plaintiff”’”].)
2. The Trial Court Properly Sustained the Demurrer to
Hasbun’s Elder Abuse Claims
a. Governing law
The Elder Abuse Act was enacted to protect elders—defined
as “any person residing within this state, 65 years of age or older”
(Welf. & Inst. Code, § 15610.27)—and dependent adults “by
providing heightened remedies that encourage private
enforcement of laws against abuse and neglect.” (Mahan v.
Charles W. Chan Ins. Agency, Inc. (2017) 14 Cal.App.5th 841, 858
(Mahan); accord, Strawn v. Morris, Polich & Purdy, LLP (2019)
30 Cal.App.5th 1087, 1103; see Tepper v. Wilkins (2017)
10 Cal.App.5th 1198, 1204 [the Elder Abuse Act was adopted to
“protect a particularly vulnerable portion of the population from
gross mistreatment in the form of abuse and custodial neglect”].)
The Act protects against “[a]buse of an elder” including
“[p]hysical abuse . . . or other treatment with resulting physical
harm or pain and mental suffering” and “[f]inancial abuse.”
(Welf. & Inst. Code, § 15610.07, subd. (a)(1) & (3).)
“Physical abuse” includes assault as defined in Penal Code
section 240 (Welf. & Inst. Code, § 15610.63, subd. (a)), which
provides, “An assault is an unlawful attempt, coupled with a
present ability, to commit a violent injury on the person of
another.” “Mental suffering” means “fear, agitation, confusion,
severe depression, or other forms of serious emotional distress
7
that is brought about by forms of intimidating behavior, threats,
harassment, or by deceptive acts performed or false or misleading
statements made with malicious intent to agitate, confuse,
frighten, or cause severe depression or serious emotional distress
of the elder or dependent adult.” (Id., § 15610.53.) The Act
defines “financial abuse” as occurring when “a person or entity
. . . [¶] [t]akes, secretes, appropriates, obtains, or retains real or
personal property of an elder or dependent adult for a wrongful
use or with intent to defraud, or both.” (Id., § 15610.30,
subd. (a)(1).)
The Elder Abuse Act requires varying standards of proof
depending on the type of abuse claimed and provides for remedies
that may be sought “in addition to all other remedies provided by
law.” (See, e.g., Welf. & Inst. Code, §§ 15657 [reasonable
attorney fees and costs shall be awarded upon “clear and
convincing evidence that a defendant is liable for physical abuse
. . . and that the defendant has been guilty of recklessness,
oppression, fraud, or malice in the commission of this abuse”],
15657.5 [authorizing action for damages and recovery of
enhanced remedies in certain circumstances involving financial
elder abuse].)
b. Hasbun lacks standing to assert a financial elder
abuse claim
Hasbun concedes the property interests at issue were
owned by a corporation, not by him. However, Hasbun argues he
has standing to pursue a financial abuse claim because the Elder
Abuse Act applies to the taking of property owned “directly or
indirectly” by an elder and he owned the property interests
indirectly as the sole shareholder of Boostz.
8
Although Hasbun is correct that, under certain defined
circumstances, the Elder Abuse Act covers the deprivation of
property not held directly by an elder or dependent adult, the
Act’s scope is not nearly as broad as he contends. Financial
abuse under the Act occurs “when an elder or dependent adult is
deprived of any property right, including by means of an
agreement, donative transfer, or testamentary bequest,
regardless of whether the property is held directly or by a
representative of an elder or dependent adult.” (Welf. & Inst.
Code, § 15610.30, subd. (c).) The following subdivision, however,
narrowly defines a “representative” as “a person or entity that is
either . . . : [¶] (1) [a] conservator, trustee, or other representative
of the estate of an elder or dependent adult [or] [¶] (2) [a]n
attorney-in-fact of an elder or dependent adult who acts within
the authority of the power of attorney.” (Id., § 15610.30,
subd. (d).)
This statutory language cannot be read to include property
owned by a corporation. (See In re Bryce C. (1995) 12 Cal.4th
226, 231 [“[g]enerally, the expression of some things in a statute
implies the exclusion of others not expressed”]; Gikas v. Zolin
(1993) 6 Cal.4th 841, 852 [same]; Lucioni v. Bank of America,
N.A. (2016) 3 Cal.App.5th 150, 159 [same].) None of the indirect
holding exceptions specified in the Act applies in this case. The
property interests at issue were not held by a conservator, trustee
or other representative of Hasbun’s estate or by Hasbun’s
attorney-in-fact acting pursuant to a power of attorney. Instead,
they were owned by a corporation, which exists as a legal entity
separate and apart from its shareholders. (See Grosset v. Wenaas
(2008) 42 Cal.4th 1100, 1108 [“[i]t is fundamental that a
corporation is a legal entity that is distinct from its
9
shareholders”]; Presta v. Tepper (2009) 179 Cal.App.4th 909, 910
[a corporation “is a distinct legal entity separate from its
stockholder and from its officers . . . and deemed a person within
many legal constructs”; internal quotation marks omitted];
see also § 17, subd. (b)(6) [“‘[p]erson’ includes a corporation as
well as a natural person”].) Because a corporation, and not
Hasbun, owned the property interests, Hasbun did not have
standing to pursue a claim for financial abuse under the Elder
Abuse Act. (See Hilliard v. Harbour (2017) 12 Cal.App.5th 1006,
1015 [plaintiff did not have standing to sue individually for
financial elder abuse because his claim did not “originate in
circumstances independent of his status as a shareholder in the
Companies, and his claim therefore cannot be deemed
personal”].)
Hasbun’s reliance on Bounds v. Superior Court (2014)
229 Cal.App.4th 468 (Bounds), for the proposition that property
owned by a corporation is akin to property held in a trust is
misplaced. In Bounds an elderly widow and her living trust, of
which she was trustee, sued for financial elder abuse based on
allegations the defendants had defrauded her into entering into
escrow to sell real property held in the trust. (Id. at p. 472.)
Although the escrow was canceled and the trust retained the
property, the widow claimed the existence of escrow instructions
impaired the right to sell the property at fair market value or to
use the property to secure a loan on favorable terms. (Ibid.) The
court of appeal granted mandamus relief, vacating the order
sustaining the demurrer to the financial elder abuse claims,
because “property right[s]” under the Elder Abuse Act included
the right to use and sell real property. (Ibid.)
10
Bounds addressed a legal issue very different from the
3
question of standing before us. In any event, as discussed, the
Elder Abuse Act expressly authorizes a claim for financial elder
abuse based on the deprivation of an elder’s property held in
trust. Moreover, in Bounds the protected elder was the trustee
and, as such, retained ownership of the property at issue in that
capacity. Unlike a corporation, which exists as a distinct legal
entity from its shareholders, “[a]n ordinary express trust is not
an entity separate from its trustees.” (Moeller v. Superior Court
(1997) 16 Cal.4th 1124, 1132, fn. 3, internal quotation marks
omitted; accord, Presta v. Tepper, supra, 179 Cal.App.4th at
p. 910.) A trust is a fiduciary relationship with respect to
property; the real party in interest in litigation involving a trust
is always the trustee. (See Moeller, at p. 1132, fn. 3; Presta, at
p. 910; cf. § 369, subd. (a)(2) [trustee of an express trust “may sue
without joining as parties for whose benefit the action is
prosecuted”].) These characteristics that differentiate a trust
from a corporation undermine Hasbun’s proposed analogy.
Hasbun’s reliance on Mahan, supra, 14 Cal.App.5th 841 to
support his argument an indirect deprivation of his property
owned by a corporation is sufficient to confer standing under the
Elder Abuse Act is also unavailing. Mahan involved life
insurance policies purchased by the elder plaintiffs that named
3
As summarized by the court of appeal, the issue before it
was “whether to allege a ‘taking’ of a property right under the
Act, it is sufficient to plead that an elder has entered into an
unconsummated agreement which, in effect, significantly impairs
the value of the elder’s property, or whether the Act requires that
the agreement have been performed and title have been
conveyed.” (Bounds, supra, 229 Cal.App.4th at p. 472.)
11
their children as beneficiaries. (Id. at p. 846.) The policies were
held in a trust, created as part of their estate plan, of which their
daughter was the trustee and beneficiary. Although the trust
(and its trustee)—not the elder plaintiffs—owned the life
insurance policies, the court held the elder plaintiffs had
standing to pursue claims under the Act because “[t]he linchpin
of the alleged scheme by Respondents was the ‘donative transfer’
of money and assets by the Mahans to the Trust.” The monies
the elder plaintiffs allegedly were defrauded into transferring to
the trust to pay for term coverage and commissions, along with
the damage caused to their estate plan, were properly considered
“property of an elder.” (Id. at p. 862.) Thus, using the trust as
the vehicle for deprivation, the defendants indirectly deprived the
elder plaintiffs of their property. (Id. at pp. 861-862.)
Unlike in Mahan, Hasbun has not alleged that O’Connor
used Boostz as a vehicle to somehow deprive Hasbun of his
property or that O’Connor defrauded Hasbun into transferring
money to Boostz, which O’Connor then wrongfully took. Nor are
there any allegations Hasbun set up the corporation as part of his
estate plan. Even apart from the difference for purposes of the
Elder Abuse Act between an asset held in trust and one owned by
a corporation, these factual differences render Mahan inapposite.
Hasbun’s remaining argument attempts to distinguish
between the corporation’s ownership interest in the real
properties and the rental income generated by those properties
based on the fact that, because Boostz is a subchapter
S corporation, the rental income would have been treated as
12
4
personal income for tax purposes. (See In re Marriage of Morton
(2018) 27 Cal.App.5th 1025, 1032, fn. 3 [explaining income and
losses of an S corporation, like those of a partnership, ““‘pass[ ]
through’” on a pro rata basis to its shareholders, who report those
items on their personal tax returns”]; see Saltzman et al., IRS
Practice & Procedure (2013) ¶ 13.10 (2)(a) [a “subchapter S”
corporation is one “whose separate identity is disregarded for tax
purposes”].) But Hasbun cites no authority for the proposition
that the tax treatment of income generated by an S corporation
somehow converts ownership of that income from corporate to
personal. Regardless of special provisions in the tax laws, any
rental income remains derivative of the interests in the
properties owned by the corporation. “But for his shareholder
status,” Hasbun would not have been injured by O’Connor’s
alleged withholding of rental income. (Hilliard v. Harbour,
supra, 12 Cal.App.5th at p. 1015 [elder plaintiff “created the . . .
LLC in order to limit his liability; there is no policy reason to
permit him to enjoy the benefits of that limitation without
accepting the concomitant burdens it entails”].) Characterizing
the taken property as rental income does not bring Hasbun’s
financial abuse claim within the ambit of the Elder Abuse Act.
4
At oral argument counsel for Hasbun asserted the
complaint alleged that the rental income was to have been paid
directly to Hasbun. It did not. In fact, the complaint repeatedly
alleged Hasbun’s interests in the properties and the rental
income were “vis a vis his S Corp.” Further, when probed at oral
argument, counsel for Hasbun stated only that Hasbun could
plead with greater specificity that rental income was to be paid to
him directly as pass-through income from Boostz, not that he was
entitled to that income in his individual capacity, separate from
his status as a shareholder of the subchapter S corporation.
13
c. A two-year statute of limitations applies to Hasbun’s
physical abuse and emotional distress causes of
action
The Elder Abuse Act does not specify the limitations period
applicable to claims for physical abuse and infliction of emotional
distress under the Act. The trial court applied the two-year
statute of limitations applicable to personal injury claims as set
forth in section 335.15 and ruled Hasbun’s claims were time-
barred. Hasbun contends the three-year statute of limitations in
section 338, subdivision (a), applicable to statutory causes of
action, governs his claims under the Elder Abuse Act and that he
6
timely filed these two causes of action.
Section 338, subdivision (a), specifies a three-year
limitations period for “[a]n action upon a liability created by
statute, other than a penalty or forfeiture.” “Courts have held
that ‘liability created by statute’ means “‘“the liability is
embodied in a statutory provision and was of a type which did
not exist at common law.”’”” (Lehman v. Superior Court (2006)
145 Cal.App.4th 109, 118; see Briano v. Rubio (1996)
5
Section 335.1 establishes a two-year limitations period for
“[a]n action for assault, battery, or injury to, or for the death of,
an individual caused by the wrongful act or neglect of another.”
6
Benun v. Superior Court (2004) 123 Cal.App.4th 113, 125-
126, relied upon by the trial court, held the two-year limitations
period in section 335.1, not the three-years-from-injury/one-year-
from-discovery statute of limitations in the Medical Injury
Compensation Reform Act (MICRA) (§ 340.5), applied to a
physical elder abuse claim against a healthcare provider. Benun
did not consider the possible applicability of section 338,
subdivision (a).
14
46 Cal.App.4th 1167, 1175 [“[a] cause of action is based upon a
liability created by law only if it exists by virtue of an express
statute or constitutional provision, and did not exist at common
law,” italics omitted]; see also Coombes v. Getz (1933) 217 Cal.
320, 335 [analyzing the phrase “created by law” contained in
section 359 and explaining the phrase refers to liability that was
first authorized by statute or the Constitution, not the common
law].)
Because the three-year statute of limitations in section 338,
subdivision (a), applies only if liability in some form would not
exist but for the statute, it does not govern Hasbun’s claims
under the Elder Abuse Act. (Cf. Jackson v. Cedars-Sinai Medical
Center (1990) 220 Cal.App.3d 1315, 1320-1321 [acknowledging
the Lanterman-Petris-Short Act “clearly refined the law with
respect to involuntary mental patients” but holding section 338
did not apply “[b]ecause the common law recognized that one
wrongfully taken into custody on psychiatric grounds had an
actionable wrong”].) “‘Any statutory “modification, alteration or
conditioning” of a common-law cause of action which falls short of
creating a previously unavailable cause of action does not
transform that cause of action into “an action . . . upon a liability
created by statute.”’” (Lehman v. Superior Court, supra,145 Cal.App.4th at p. 119; see Brandenburg v. Eureka
Redevelopment Agency (2007) 152 Cal.App.4th 1350, 1363
[holding section 338 did not apply to claims under Government
Code section 1090 because the “expan[sion] or modifi[cation] [of]
the basic common law prohibition against public officials having
an interest in public contracts to include contracts made by a
board or body of which the official is a member” did not create a
previously unavailable cause of action].) Nor is liability created
15
by the expansion of available remedies for a breach of duty
existing at common law. (Lehman, at p. 119.)
The Elder Abuse Act undoubtedly expanded remedies
available to elders and dependent adults who have suffered
physical abuse and emotional distress (Welf. & Inst. Code,
§§ 15657, 15657.5), but the Act did not create new causes of
action to address those wrongs. Though it has long been codified,
liability for physical abuse, and specifically assault, existed first
at common law. (See People v. Yslas (1865) 27 Cal. 630, 633
[explaining “[t]he common law definition of an assault is
substantially the same as that found in the statute”]; see also
People v. Bailey (2012) 54 Cal.4th 740, 750 [“[i]n determining the
meaning of ‘attempt’ in [Penal Code] section 240, we have looked
to the historical “‘common law definition’” of assault”].) Likewise,
liability for intentional infliction of emotional distress existed,
and continues to exist, at common law. (See State Rubbish
Collectors Assn. v. Siliznoff (1952) 38 Cal.2d 330, 338 [intentional
infliction of emotional distress is a common law tort].)
Accordingly the trial court correctly ruled a two-year limitations
period applied to these causes of action. (See Code of Civ. Proc.,
§ 335.1 [action for assault must be commenced within two years];
Wassmann v. South Orange County Community College Dist.
(2018) 24 Cal.App.5th 825, 852-853 [“[i]ntentional infliction of
emotional distress has a two-year statute of limitations”].)
The holding in Perlin v. Fountain View Management, Inc.
(2008) 163 Cal.App.4th 657, 666, that the Elder Abuse Act
“creates an independent cause of action” and does not merely
enhance remedies, made in the context of evaluating the
elements of a successful elder abuse claim necessary for an award
16
7
of attorney fees, does not affect our conclusion. Even if the Act
has created independent causes of action, the question for
limitations purposes is whether the type of liability encompassed
by the statute is one that did not previously exist at common law.
As discussed, liability for physical abuse and infliction of
emotional distress under the Act are simply variants of causes of
action that existed at common law.8
7
A split of authority exists whether the Act creates an
independent cause of action or simply provides additional
remedies for existing causes of action. (Compare Perlin v.
Fountain View Management, Inc., supra, 163 Cal.App.4th at
p. 666 with Berkley v. Dowds (2007) 152 Cal.App.4th 518, 529
[“[t]he Act does not create a cause of action as such, but provides
for attorney fees, costs, and punitive damages under certain
conditions”].) At least one court of appeal has observed, “An elder
abuse claim could be a ‘cause of action’ for some statutory
purposes but not others.” (Smith v. Ben Bennett, Inc. (2005)
133 Cal.App.4th 1507, 1525 [“[w]e are not convinced that a
Platonic approach—under which an elder abuse claim must
abstractly be either a ‘cause of action’ or a plea for ‘enhanced
remedies’—is fruitful”].)
8
Hasbun’s argument in his reply brief for a three-year
limitations period because his allegations of stalking and
intimidation constitute “physical abuse” under the Elder Abuse
Act, but not common law assault, is mistaken. “Physical abuse”
under the Act is expressly defined by Welfare and Institutions
Code section 15610.63 and does not include intimidation and
stalking. If asserted in a timely manner, however, harassment of
that sort could be part of a claim for emotional distress under the
Act, which includes “serious emotional distress that is brought
about by forms of intimidating behavior, threats, harassment, or
by deceptive acts.” (Welf. & Inst. Code, § 15610.53.)
17
The analysis generally utilized to determine the applicable
limitations period for a particular claim further supports our
conclusion that section 335.1 applies to Hasbun’s physical and
emotional distress elder abuse causes of action. “[T]o determine
the statute of limitations which applies to a cause of action it is
necessary to identify the nature of the cause of action, i.e., the
‘gravamen’ of the cause of action.” (Hensler v. City of Glendale
(1994) 8 Cal.4th 1, 22; accord, Smith v. Ben Bennett, Inc. (2005)
133 Cal.App.4th 1507, 1525.) “The nature of the cause of action
and the primary right involved, not the form or label of the cause
of action or the relief demanded, determine which statute of
limitations applies.” (Carter v. Prime Healthcare Paradise Valley
LLC (2011) 198 Cal.App.4th 396, 412; accord, Smith, at p. 1525;
Hydro-Mill Co., Inc. v. Hayward, Tilton & Rolapp Ins. Associates,
Inc. (2004) 115 Cal.App.4th 1145, 1153; see Jefferson v. J.E.
French Co. (1960) 54 Cal.2d 717, 718.) The gravamen of
Hasbun’s claims is that O’Connor violated his right to be free
from physical and emotional abuse. (See Estate of Dito (2011)
198 Cal.App.4th 791, 802 [Elder Abuse Act claims address the
primary rights “not to be abused or defrauded”].) The two-year
statute of limitations in section 335.1 applies to claims of
personal injury and, therefore, applies to Hasbun’s physical
abuse and emotional distress claims under the Elder Abuse Act.
3. The Trial Court Properly Sustained the Demurrer to
Hasbun’s Cause of Action for Breach of Fiduciary Duty
Hasbun contends O’Connor owed him a fiduciary duty
because they were co-investors in real estate and because
O’Connor acted in his capacity as a licensed real estate agent on
behalf of the co-investors, including as a property manager
collecting rental income. Although it is “well established that a
18
joint venturer owes fiduciary duties to his coventurers” (Galardi
v. State Bar (1987) 43 Cal.3d 683, 691), Hasbun failed to allege
facts establishing he and O’Connor were engaged in a joint
venture or that he had any other business affiliation with
O’Connor that would create a fiduciary relationship between the
two men.
Hasbun admitted that Boostz, not Hasbun, was the co-
investor in the properties. Hasbun’s alternative argument that
O’Connor owed him a fiduciary duty as a “majority shareholder”
is misdirected. The authorities Hasbun cites concern the
fiduciary duties owed by majority shareholders of a corporation to
minority shareholders of the same corporation. (See, e.g.,
Stephenson v. Drever (1997) 16 Cal.4th 1167, 1178 [“‘[m]ajority
shareholders may not use their power to control corporate
activities to benefit themselves alone or in a manner detrimental
to the minority’”]; Steinberg v. Amplica, Inc. (1986) 42 Cal.3d
1198, 1202 [determining the remedies available to a minority
shareholder who alleged his shares were undervalued during a
merger because of fraud and breach of fiduciary duty by the
majority stockholders in the corporation].) Hasbun and O’Connor
were never shareholders of the same corporation. The trial court
properly sustained O’Connor’s demurrer to this cause of action.
4. Hasbun Has Forfeited His Right to Request Leave To
Amend
Hasbun requests leave to amend if we rule a two-year
statute of limitations applies to his physical and emotional
distress elder abuse claims, asserting O’Connor’s “conduct in non-
financial abuse persisted through August 2016,” that is, within
two years of the August 1, 2018 filing date of his complaint.
19
The trial court granted Hasbun leave to amend his causes
of action for physical and emotional distress elder abuse, but he
elected not to amend his complaint. Hasbun thereby forfeited his
right to request leave to amend in this court. (See Foxen v.
Carpenter (2016) 6 Cal.App.5th 284, 296 [plaintiff forfeited right
to request leave to amend on appeal because the court sustained
defendant’s demurrer with leave to amend and plaintiff chose not
to file an amended complaint]; see Las Lomas Land Co., LLC v.
City of Los Angeles (2009) 177 Cal.App.4th 837, 861 [declining
opportunity to amend complaint in the trial court forfeits right on
appeal to request leave to amend].)
“‘[W]hen a plaintiff is given the opportunity to amend his
complaint and elects not to do so, strict construction of the
complaint is required and it must be presumed that the plaintiff
has stated as strong a case as he can.’” (Reynolds v. Bement
(2005) 36 Cal.4th 1075, 1091; see Zolly v. City of Oakland (2020)
47 Cal.App.5th 73, 82 [same].) In that circumstance, “unlike
when a demurrer is sustained without leave to amend, we
determine only whether the plaintiff stated a cause of action, and
not whether the plaintiff might be able to do so.” (Lyles v.
Sangadeo-Patel (2014) 225 Cal.App.4th 759, 764; see Soliz v.
Williams (1999) 74 Cal.App.4th 577, 585 [“‘[w]hen a plaintiff
elects not to amend the complaint, it is presumed that the
complaint states as strong a case as is possible [citation]; and the
judgment of dismissal must be affirmed if the unamended
complaint is objectionable on any ground raised by the
demurrer’”].) Because the allegations as pleaded fail to state
causes of action, we affirm the judgment of dismissal.
20
DISPOSITION
The judgment is affirmed. O’Connor is to recover his costs
on appeal.
PERLUSS, P. J.
We concur:
FEUER, J.
*
McCORMICK, J.
*
Judge of the Orange County Superior Court, assigned by
the Chief Justice pursuant to article VI, section 6 of the
California Constitution.
21