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Edvard Eshagh v. the Terminix International Co.

July 25, 2011

EDVARD ESHAGH,
PLAINTIFF,
v.
THE TERMINIX INTERNATIONAL CO., L.P., ET AL.,
DEFENDANTS.



The opinion of the court was delivered by: Oliver W. Wanger United States District Judge

MEMORANDUM DECISION RE: MOTION TO DISMISS (Doc. 10)

I. INTRODUCTION.

Edvard Eshagh ("Plaintiff") proceeds with an action against Terminix International Company, L.P. and Terminix International, Inc., ("Defendants") pursuant to 28 U.S.C. § 1332.*fn1

On April 7, 2010, Defendants filed a motion to dismiss Plaintiff's complaint. (Doc. 10). Plaintiff filed opposition on June 24, 2011. (Doc. 18). Defendants filed a reply on July 5, 2011. (Doc. 23).

II. FACTUAL BACKGROUND.

Defendants provide termite prevention services. From 1999 to the present, Plaintiff has contracted with Defendants for termite prevention services at his residence under a Control Service Agreement ("CSA").

Pursuant to Defendants' internal policy, certain "Minimum Basic Requirements" must be satisfied in order for a property to qualify for a "Terminix Guarantee." At all times relevant, Plaintiff's property has been in violation of two of the Minimum Basic Requirements. First, Plaintiff's property has an "uncorrected stucco hazard" within the meaning of Defendants' internal policies. Second, Plaintiff's property is incapable of receiving an "entire structure treatment" due to various attributes of the property. Despite these deficiencies, Defendants issued Terminix Guarantees for Plaintiff's property and falsely represented that they had performed "all necessary services" within the meaning of the CSA.

Defendants did not disclose to Plaintiff that they were not performing all "necessary services" required by Defendants internal procedures. Defendants internal policies set forth the following options for addressing a stucco condition such as Plaintiff's: (1) lower the exterior grade to expose the bottom edge of the stucco and create three inches clearance of exposed foundation; (2) seal off or recommend sealing off the stucco; or (3) cut stucco back from ground contact for proper inspection and treatment. Defendants did not address the stucco condition on Plaintiff's property as required by Defendants' policies, leaving Plaintiff's property susceptible to termite damage.

In February 2008, Plaintiff discovered a termite infestation at his property when a section of flooring gave way. In 2009, another area of floor gave way in a different area of Plaintiff's property. The State of California inspected Plaintiff's property in 2010 and concluded that Terminix had not adequately treated Plaintiff's property for termite prevention.

III. DISCUSSION.

A. Statute of Limitations

1. Breach of Contract Cause of Action

Plaintiff's fourth cause of action is for breach of contract. Plaintiff alleges that Defendants breached the terms of the CSA by failing to perform "all necessary services" within the meaning of the CSA. Plaintiff complains that Defendants did not correct the stucco hazard and did not provide an "Entire Structure Treatment." (Comp. at 39).

Under California law, the ordinary statute of limitations for breach of a written contract is four years. Cal. Civ. Pro. § 337; e.g., Vu v. Prudential Property & Casualty Ins. Co., 26 Cal. 4th 1142, 1148 (Cal. 2001). The limitations period commences when the cause of action accrues. Cal. Civ. Pro. § 312; Fox v. Ethicon Endo-Surgery, Inc., 35 Cal.4th 797, 806 (2005). "Generally speaking, a cause of action accrues at 'the time when the cause of action is complete with all of its elements.'" Id.

The discovery rule "postpones accrual of a cause of action until the plaintiff discovers, or has reason to discover, the cause of action." E-Fab, Inc. v. Accountants, Inc. Services, 153 Cal. App. 4th 1308, 1318 (Cal. Ct. App. 2007) (citation omitted). Delayed accrual of a cause of action may result where the relationship between the parties is one of special trust. Id. Where the discovery rule applies, the limitations period does not accrue until the aggrieved party has notice of the facts constituting the injury. Id. A person with actual notice of circumstances sufficient to put a prudent person upon inquiry is deemed to have constructive notice ...


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