PI Properties No. 79 v. Romero CA2/4

INTRODUCTION

In 2018, appellant PI Properties No. 79, LLC (PI Properties) bought a three story, 15-unit apartment building from respondent Fremont Oaks, LLC (Fremont). Two years after the sale, PI Properties received a citation from the City of Los Angeles (City) indicating 12 of the 15 units were unpermitted. Two years after receiving the citation, PI Properties sold the property at a loss. PI Properties sued Fremont and its principal, respondent Everilda Romero, for fraud and breach of contract, among other claims. Fremont and Romero demurred, arguing the terms of the sale contract barred any claim by PI Properties. The trial court agreed, sustained the demurrer without leave to amend, and entered judgment for Fremont and Romero. We conclude the contract does not bar fraud claims, and therefore reverse the judgment.

FACTS AND PROCEDURAL BACKGROUND

I. The Sale

In May 2018, Romero, acting on behalf of Fremont, hired Kevin Russell, a real estate broker, to sell a three-story apartment building on Alhambra Avenue in Los Angeles.1 Romero instructed Russell to advertise the property as a 15-unit apartment building containing “bachelor” apartment units and valued at $2 million;…