Is there an abuse of authority in sustaining the demurrer without leave to amend?

We now address ourselves to the issue as to whether there was an abuse of discretion in sustaining the demurrer without leave to amend. While the plaintiffs have made unsuccessful attempts to correct the defects in their pleadings in order to state a cause of action, we find that they should be permitted leave to file amended pleadings correcting their defects as the defects, although of substance, appear to be curable by supplying omitted allegations. (See Greenberg v. Equitable Life Assur. Society (1973) 34 Cal.App.3d 994, 998, 110 Cal.Rptr. 470.) While plaintiffs' allegations of wrongful acts by defendants appear to be weak, under the principle of both wilful and negligent liability as set forth in section 1714 of the Civil Code and under the concept that reasonable foreseeability of harm can create a duty of care, we concluded that the plaintiffs can plead an actionable wrong against defendants. Plaintiffs must accept the fact that their action against defendants is an action by secured parties whose collateral or security interest has been impaired by the alleged wrongful acts of defendants and that plaintiffs do not "stand in the shoes" of the partners so that they can sue for breach of the partnership agreement or for breach of a fiduciary duty. In addition plaintiffs must recognize that the amount of compensatory damages that they may request is limited by any impairment in the value of their collateral caused by defendants' alleged wrongful acts and is further limited to a sum not greater than the balance due on the security indebtedness plus collection costs.

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