Software Design & Application, Ltd. v. Hoefer & Arnett, Inc.

This is an appeal from judgments of dismissal after the court sustained demurrers and appellants declined to amend. Although they were strangers to, not customers of, the respondent banks and brokerage firms, appellants attempted to recover from them on several theories, including negligence and conversion. The real culprit, appellants’ faithless financial consultant entrusted with a valuable portfolio, liquidated the assets with the help of his sister through an ingenious scheme involving a series of fictitious accounts. The trial court correctly concluded there was no liability under the pleadings and, accordingly, we affirm the judgments.

I. Factual Background

On appeal we treat the demurrer as admitting all properly pleaded material facts and consider matters which may be judicially noticed. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318 [ 216 Cal.Rptr. 718 , 703 P.2d 58 ]; Stanton Road Associates v. Pacific Employers Ins. Co. (1995) 36 Cal.App.4th 333, 340 [ 43 Cal.Rptr.2d 1 ].) We thus turn to the complaint for the factual contour, as follows: Appellant Manu Chatterjee is founder and sole owner of SDA, a Hong Kong corporation. In 1991 Chatterjee hired Patrick McDonald…