Opinion
A149854
06-29-2018
DONALD GLAUDE, Plaintiff and Appellant, v. FREDERICK TINSLEY et al., Defendants and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Alameda County Super. Ct. No. HG14743483)
Donald Glaude sued his former employer (Macy's, Inc.), his union, and his nephew Frederick Tinsley. As to his nephew, he alleged fraud and quiet title claims concerning the ownership of real property. As to all three defendants he alleged a conspiracy to defraud him by intentionally misrepresenting evidence at an arbitration hearing that affirmed the termination of his employment. After each defendant demurred to the operative second amended complaint, the trial court: 1) sustained the nephew's demurrer with leave to amend the fraud and quiet title claims, and sustained the demurrer without leave to amend as to the conspiracy claim; and 2) sustained the demurrers by Macy's, Inc. (Macy's) and the union without leave to amend and dismissed them from the case. Glaude purports to appeal from the orders on the conspiracy claim. We dismiss Glaude's appeal as to the nephew, because the order sustaining the nephew's demurrer on the conspiracy claim is not an appealable order. We affirm the orders dismissing Macy's and the union.
FACTUAL AND PROCEDURAL BACKGROUND
We briefly describe the pertinent facts alleged by Glaude.
Glaude was a member of the International Union of Operating Engineers, Stationary Engineers, Local 39 (the Union) and employed by Macy's. His nephew, Frederick Tinsley, falsely claimed to own certain real property that was previously owned by Tinsley's grandmother, who is also Glaude's mother. In 2011, Tinsley signed an agreement to surrender the property and quitclaim it to Glaude, but reneged on the agreement, leading Glaude to allege against him causes of action for fraud and to quiet title.
The initial complaint in this matter is not part of the record; apparently it alleged only claims against Tinsley concerning the disputed property. In December 2015, Glaude filed a first amended complaint that added a cause of action for conspiracy that arose from Glaude's 2012 termination from Macy's for violating Macy's travel policy and theft of company time. The termination was upheld at an arbitration hearing, and in the conspiracy claim, Glaude alleged that Tinsley (who, like Glaude, was employed by Macy's), Macy's, the Union, and the lawyer and firm who represented Glaude at the arbitration conspired to misrepresent the facts and withhold material evidence at the hearing.
Glaude dismissed the lawyer and her firm from the case after they filed a demurrer to the conspiracy claim and a motion to strike. Macy's and Tinsley demurred to the conspiracy claim in the first amended complaint, and the demurrers were sustained with leave to amend. The Union responded to the first amended complaint with a motion to quash service of summons. The court denied the motion and ordered the Union to respond to the second amended complaint.
In his second amended complaint, Glaude realleged his causes of action against Tinsley for fraud and quiet title as to the real property, and amended his cause of action for conspiracy, alleging that Tinsley, Macy's and the Union conspired to intentionally misrepresent facts at the arbitration hearing on his termination, with the result that the termination was upheld.
According to the second amended complaint, Glaude was terminated as a result of an investigation that Macy's began in December 2011 as retaliation for his refusal to cooperate with a request from his superiors that he reprimand one of his subordinates for an alleged violation that the subordinate had not committed. But Macy's claimed that the termination resulted from an investigation that began in January 2012 after Tinsley submitted a written report that accused Glaude of violating Macy's travel policy, clocking into work remotely, and stealing time (i.e., receiving wages for time not actually worked). This report, Glaude alleges, cast Tinsley as a whistleblower and was collectively fabricated by Tinsley, Macy's and the Union with the goal of harming Glaude and the knowledge that it would be used against him, as it eventually was at the arbitration.
In his opening brief, Glaude claims that Tinsley seized an opportunity presented to him by Macy's and participated in fabricating the report so that Glaude would be terminated and unemployable, with the result that Glaude would have no resources to pursue his legal claims against Tinsley regarding the disputed real property.
Glaude alleges that the Union, through its business representative, falsely told Glaude that he would receive "the best representation available" at the arbitration hearing. The representative also asked Glaude to send him any information that Glaude thought would be useful to his case, for the representative to forward to Glaude's attorney. Instead, the Union conspired with Macy's by refusing to interview or contact the four potential witnesses that Glaude identified, and refusing to call those witnesses to testify at the arbitration. Glaude also claims that the Union conspired with Macy's to conceal certain material facts that were helpful to Glaude's case by failing to present them at the hearing and by not challenging purported facts and evidence presented by Macy's. In particular, the Union and Macy's conspired to present as evidence telephone records from a phone number that Glaude never used. And the Union allegedly conspired with Macy's even after the arbitration was finished by concealing from Glaude that he had 100 days to challenge the arbitrator's ruling.
Tinsley demurred to the entire second amended complaint under Code of Civil Procedure section 430.10 on the ground that Glaude failed to state a cause of action; Macy's and the Union each demurred to the cause of action for conspiracy, the only one that pertained to them, on the same ground.
Statutory references are to the Code of Civil Procedure unless otherwise stated.
After briefing and extensive oral argument, the trial court issued orders sustaining Macy's and the Union's demurrers without leave to amend and dismissing them from the case. The trial court also sustained Tinsley's demurrer to the conspiracy cause of action without leave to amend, but sustained with leave to amend Tinsley's demurrers to the other causes of action, and therefore did not dismiss Tinsley from the case.
Glaude filed a notice of appeal.
DISCUSSION
A. The Order Sustaining Tinsley's Demurrer is Not Appealable
Glaude purports to appeal from the order sustaining Tinsley's demurrer insofar as the order dismisses the conspiracy claim without leave to amend, but the order is not appealable. (Kong v. City of Hawaiian Gardens Redevelopment Agency (2002) 108 Cal.App.4th 1028, 1032, fn.1 [order sustaining demurrer without leave to amend is not appealable, but is subject to review on appeal from order of dismissal].) Accordingly we shall dismiss the appeal with respect to the order on Tinsley's demurrer. B. The Trial Court Did Not Err in Sustaining Macy's and the Union's Demurrers
1. Applicable Law and Standard of Review
The cause of action at issue in this case is entitled, "Conspiracy to defraud plaintiff by intentionally misrepresenting factual evidence at arbitration hearing." It is well-settled that "[c]onspiracy is not a cause of action, but a legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasors a common plan or design in its perpetration." (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510-511.) Thus, for Glaude's conspiracy claim to survive he must allege an underlying tort and resulting damages, as well as the formation and operation of a conspiracy. (Unruh v. Truck Insurance Exchange (1972) 7 Cal.3d 616, 631, superseded by statute on other grounds as stated in Hendy v. Losse (1991) 54 Cal.3d 723, 732, fn. 6.) To state a cause of action for fraud, Glaude must plead the following elements: "(1) a misrepresentation of a material fact; (2) knowledge of falsity; (3) intent to deceive and induce reliance; (4) justifiable reliance on the misrepresentation; and (5) resulting damages." (Century Surety Co. v. Crosby Ins. Inc. (2004) 124 Cal.App.4th 116, 122.)
In reviewing orders of dismissal when a demurrer has been sustained without leave to amend, "courts must assume the truth of the complaint's properly pleaded or implied factual allegations. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) Courts must also consider judicially noticed matters. (Ibid.) In addition, we give the complaint a reasonable interpretation, and read it in context. (Ibid.)" (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081 (Schifando).) "We do not, however, assume the truth of contentions, deductions, or conclusions of fact or law." (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 125.) We independently "determine whether the complaint states facts sufficient to state a cause of action." (Schifando, supra, 31 Cal.4th at p. 1081.) A demurrer is properly sustained "where the complaint 'has included allegations that clearly disclose some defense or bar to recovery.' " (Casterson v. Superior Court (2002) 101 Cal.App.4th 177, 183.) "The fact that we examine the complaint de novo does not mean that plaintiffs need only tender the complaint and hope we can discern a cause of action. It is plaintiffs' burden to show . . . that the demurrer was sustained erroneously . . . ." (Keyes v. Bowen (2010) 189 Cal.App.4th 647, 655 (Keyes).)
"If the court sustained the demurrer without leave to amend, as here, we must decide whether there is a reasonable possibility the plaintiff could cure the defect with an amendment. ([Blank v. Kirwan, supra, 39 Cal.3d at p. 318].) If we find that an amendment could cure the defect, we conclude that the trial court abused its discretion and we reverse; if not, no abuse of discretion has occurred. (Ibid.) The plaintiff has the burden of proving that an amendment would cure the defect. (Ibid.)" (Schifando, supra, 31 Cal.4th at p. 1081.)
2. Conspiracy Claim Against Macy's
Glaude argues that he pleaded the elements of fraud against Macy's as follows: he alleged that Macy's misrepresented material facts by presenting false phone records as evidence in the arbitration hearing, that Macy's knew the records were false, that Macy's intended to induce the arbitrator to rely on the records, that the arbitrator justifiably relied on the evidence (because the Union did not object to or question the evidence), and that Glaude was damaged as a result of arbitrator upholding the termination.
These allegations, however, do not constitute a claim for fraud because Glaude does not plead that he relied on Macy's misstatements; instead, he pleads that the arbitrator relied on Macy's misstatements. (Mirkin v. Wasserman (1993) 5 Cal.4th 1082, 1088-1089 (Mirkin).) Glaude asserts that misrepresentations to the arbitrator are deemed misrepresentations to him, and likewise that misrepresentations to him are deemed misrepresentations to the arbitrator, but he cites no authority to support those assertions, and we are aware of none. To the extent Glaude alleged that Macy's committed fraud by concealing from the arbitrator material facts about his employment record, Glaude fails to state a claim for fraud because Glaude does not allege that his record was concealed from him, nor that Macy's owed him a duty of care. (Hahn v. Mirda (2007) 147 Cal.App.4th 740, 745 ["To state a cause of action for fraudulent concealment, the defendant must have been under a duty to disclose some fact to the plaintiff"].)
The trial court further ruled that to the extent Glaude's fraud claim is based on representations that Macy's made during the arbitration, the claim is barred by the litigation privilege (Civ. Code, § 47, subd. (b)), which applies in contractual arbitrations like the one here. (Moore v. Conliffe (1994) 7 Cal.4th 634, 637-638.) Glaude cites Civil Code section 47, subdivision (b)(2) for the proposition that the litigation privilege does not apply to "any communication made in furtherance of an act of intentional destruction or alteration of physical evidence undertaken for the purpose of depriving a party to litigation of the use of that evidence." (Capitalization omitted.) Glaude argues on appeal that Macy's altered records and submitted them to the arbitrator as evidence, but his second amended complaint contains no allegation of destruction or alteration of evidence, despite the fact that the trial court previously gave him the opportunity to amend the complaint to add such allegations. Furthermore, Glaude neither alleges nor argues that any purported destruction or alteration of evidence was undertaken to deprive him of the use of such evidence. (Civ. Code, § 47, subd. (b)(2).)
Construing Glaude's complaint liberally, as required by section 452, the trial court considered whether the complaint might be understood as a petition to vacate the arbitrator's award on the ground that it was procured by fraud. (§ 1286.2, subd. (a)(1).) The trial court concluded that such a claim is barred by Glaude's failure to file a petition to vacate the award no later than 100 days after the award was served on him. (§ 1288.) As the trial court explained, even assuming that the 100-day period did not start to run until Glaude discovered the conspiracy upon receiving a copy of the arbitration report in January 2014, the complaint would be untimely as a petition to vacate the award, because Glaude first alleged his conspiracy claims in a complaint filed in December 2015, almost two years later. Glaude apparently concedes the point, and we see no error in the trial court's conclusion.
In sum, because Glaude's allegations against Macy's fail to state a claim, the trial court did not err in sustaining Macy's demurrer.
3. Conspiracy Claim Against the Union
Glaude's argument on appeal that he has pleaded the elements of fraud as to the Union is unclear. The trial court concluded that the alleged misrepresentations made by the Union are not statements of present or existing facts on which a fraud cause of action can be based, and Glaude does not argue that issue on appeal. To the extent Glaude's claim of fraud against the Union rests on allegations that the Union made false statements to him about the quality of legal representation it would provide or the actions the lawyers would take on receiving information from him, the complaint fails to state a cause of action because those alleged misrepresentations are not actionable. They are not misrepresentations of existing fact, but instead are statements of opinion or statements as to another party's future action, which do not give rise to a claim for fraud. (Nibbi Brothers, Inc. v. Home Federal Sav. & Loan Assn. (1988) 205 Cal.App.3d 1415, 1423.) To the extent his claim of fraud against the Union rests on allegations that the arbitrator relied on the Union's misrepresentations or concealments during the arbitration hearing, the complaint fails to state a cause of action because those alleged misrepresentations and concealments were not directed at Glaude. (See Mirkin, supra, 5 Cal.4th at pp. 1088-1089.)
The trial court further ruled that Glaude's fraud claim against the Union is barred by the litigation privilege. (Civ. Code, § 47, subd. (b).) Glaude does not address that issue with respect to the Union, except to state that the Union's only defense to his allegations is a claim of immunity under the litigation privilege. --------
Construing Glaude's complaint liberally, the trial court considered whether Glaude's allegations against the Union, including allegations that the Union breached its duty to him by failing to provide him with the representation it promised, by failing to present evidence or make objections at the arbitration hearing and by failing to interview and present witnesses, amount to a claim that the Union breached its duty of fair representation. (See Peterson v. Kentucky (9th Cir. 1985) 771 F.2d 1244, 1253-1254 [union breaches duty of fair representation when its conduct toward a member is " 'arbitrary, discriminatory, or in bad faith' "]; Beck v. United Food and Commercial Workers Union, Local 99 (9th Cir. 2007) 506 F.3d 874, 880 [to show bad faith, "plaintiff must show 'substantial evidence of fraud, deceitful action or dishonest conduct' "].) The trial court noted that a cause of action for breach of the duty of fair representation must be brought within six months (29 U.S.C. § 160(b)), and Glaude does not contest the trial court's conclusion that, because he learned of the wrongful conduct in January 2014 but did not complain of the Union's conduct until December 2015, the claim is barred by the statute of limitations.
Finally, as it did with respect to Glaude's claim against Macy's, the trial court considered whether the complaint against the Union the complaint could be understood as a petition to vacate the arbitration award on the ground that it was procured by fraud. (§ 1286.2, subd. (a)(1).) The trial court concluded that such a claim is barred, just as such a claim against Macy's is barred, and Glaude does not argue otherwise.
In sum, Glaude's allegations against the Union fail to state a claim, the trial court did not err in sustaining the Union's demurrer.
4. Denial of Leave to Amend
Glaude contends that the trial court erred in sustaining the demurrers by Macy's and the Union without leave to amend. The amendment he proposes on appeal is that the wrongful actions he alleges on the part of Macy's and the Union were undertaken by agents of Macy's and agents of the Union, but such amendments would not cure the fundamental flaws in Glaude's underlying tort claims, and therefore we conclude that the trial court did not abuse its discretion in sustaining the demurrers without leave to amend. (Schifando, supra, 31 Cal.4th at p. 1081.)
DISPOSITION
The appeal from the trial court's order on Tinsley's demurrer is dismissed. The orders dismissing Macy's and the Union are affirmed. The parties shall bear their own costs on appeal.
/s/_________
Miller, J. We concur: /s/_________
Kline, P.J. /s/_________
Richman, J.