Justia California Court of Appeals Opinion Summaries

Defendants Charles and Stella Ohaeri leased space for a thrift store in a shopping center owned by plaintiff AP-Colton LLC. The thrift store was not a success, and the Ohaeris stopped paying rent. According to the Ohaeris, AP-Colton had fraudulently induced them to enter into the lease by stating that a church was going to move into the space next to theirs, but a competing store moved in instead. AP-Colton originally filed this case as a limited civil action, in which damages were limited to $25,000. The Ohaeris filed a cross-complaint seeking more than $25,000, but they did not pay the $140 fee required to reclassify the case as an unlimited civil action. Thereafter, AP-Colton filed an amended complaint seeking more than $25,000, because the Ohaeris should already have paid the reclassification fee, so AP-Colton did not pay it. After a bench trial, the trial court rejected the Ohaeris' fraud claims and awarded AP-Colton $126,437.25. The Ohaeris argued on appeal of that judgment that among other things, the case remained a limited civil action, and thus, the trial court erred by awarding damages of more than $25,000. The Court of Appeal agreed that the case should have remained a limited civil action. The Ohaeris, however, took the position below that the case had become an unlimited civil action, and the trial court accepted this position by awarding AP-Colton damages in excess of $25,000. The Court of Appeal held that as a result, the Ohaeris were judicially estopped to deny that the case was an unlimited civil action. Accordingly, on condition that it pays the $140 reclassification fee, AP-Colton can recover the full award. View "AP-Colton v. Ohaeri" on Justia Law

The trial court found that a general contractor, Jeff Tracy, Inc., doing business as Land Forms Construction, did not have a valid license while performing work on a project for City of Pico Rivera. Therefore, the court ordered Land Forms to disgorge all compensation paid to it by the City. Land Forms appealed, contending that the trial court improperly denied it a jury trial. The court concluded that Land Forms was entitled to a jury trial on these issues, and therefore reversed the judgment. However, the court found that Land Forms is not entitled to any apportionment where Business and Professions Code section 7031, subdivision (b) does not allow apportionment as a matter of law. Accordingly, the court reversed the trial court's judgment. View "Jeff Tracy, Inc. v. City of Pico Rivera" on Justia Law

In this accounting action, plaintiff did not give notice of damages to defendants before their default was entered. Although the court agreed with cases finding that a plaintiff in an action for accounting need not give notice of damages before a defendant’s default is entered, the court also found that an exception to that rule applies: where, as here, plaintiff knew what his damages were and defendants did not have access to that information, notice must be given before default is entered. Accordingly, the court reversed the order denying defendants’ motion to set aside their default and default judgment. View "Warren v. Warren" on Justia Law

Robert Benson appealed the denial of his motion for attorney fees and costs from respondent Southern California Auto Sales, Inc. (SCAS), after he obtained a favorable judgment based on the Consumer Legal Remedies Act (CLRA). The court found that SCAS had offered Benson an appropriate correction upon receiving the statutorily required notice of problems with its used car. Benson contended the trial court erred in deciding SCAS had offered him an appropriate correction under the CLRA, and further that he was entitled to attorney fees as the prevailing party. After review, the Court of Appeal chose to defer to the trial court's determination of whether a correction offer was appropriate in this case. "Whether a plaintiff can recover attorney fees and costs incurred in an action for damages after being offered an appropriate correction is a matter of statutory interpretation, and we conclude CLRA fees and costs are not available under these circumstances." View "Benson v. Southern Cal. Auto Sales" on Justia Law

Tribeca sued after First American refunded a $1 million deposit to a real estate investor out of an escrow account that Tribeca had opened. Tribeca claimed it was entitled to the deposit and asserted claims for breach of contract, breach of fiduciary duty, fraud, and negligence. The trial judge and court of appeal ruled in favor of First American. The escrow instructions did not require that the funds, which had been deposited by a third party, be subject to Tribeca’s directions. First American’s expert witness testified that its conduct fell within the standard of care and that returning the money to the depositor was proper. The court credited the testimony of that expert above the testimony of the Tribeca expert. View "Tribeca Co. v. First American Title Ins." on Justia Law

Plaintiff Duarte Nursery, Inc. sold grape rootstock. It challenged mandatory assessments it had to pay to the California Grape Rootstock Improvement Commission to help fund research for pest-resistant and drought-resistant rootstock, arguing this “Commission Law” and the Commission’s operation as an unconstitutional exercise of the state’s police power in violation of plaintiff’s liberty interests and due process rights under the federal and state Constitutions. In this appeal, instead of claiming impairment of its rights to free speech or free association, plaintiff asserted a right to refuse to help fund research that benefitted the industry as a whole. Plaintiff sought injunctive and declaratory relief and refunds. After a bench trial, the trial court entered judgment in favor of defendants, the Commission and the Secretary of the California Department of Food and Agriculture (Secretary). Finding no reversible error, the Court of Appeal affirmed. View "Duarte Nursery v. Cal. Grape Rootstock Improvement Comm." on Justia Law

Plaintiffs Alamo Recycling, LLC and Chino Valley Recycling, LLC operated “recycling center[s]” where beverage containers sold in California may be redeemed for their “California Redemption Value.” In this action, plaintiffs sued defendant Anheuser Busch Inbev Worldwide, Inc. and other companies that sell or distribute beverages containers in California, alleging that defendants knowingly and “falsely” label beverage containers sold both inside and outside California with “CA CRV,” “California Redemption Value,” or similar labels when, in fact, under California law, only containers purchased inside California may be redeemed in California. The complaint alleged that containers sold outside California are transported into California and redeemed at recycling centers like those operated by plaintiffs, and this exposed plaintiffs to state regulatory fines and penalties, risks rendering the “California Beverage Recycling Fund” insolvent, and thereby risks the economic viability of plaintiffs’ recycling businesses. The trial court sustained defendants’ general demurrer to the complaint without leave to amend, dismissed the complaint, and entered judgment in favor of defendants. Plaintiffs appealed. The Court of Appeal concluded that the injunctive and compensatory relief plaintiffs sought could not be awarded by a California court because it would violate the “dormant” commerce clause of the federal Constitution. The Court therefore affirmed the judgment of dismissal. View "Alamo Recycling v. Anheuser Busch Inbev Worldwide" on Justia Law

The Judicial Council of California, (JCC) entered into a contract with Jacobs Facilities, a wholly owned subsidiary of Jacobs. Performance of the contract required a license under the Contractors’ State License Law. Facilities was properly licensed when it commenced work. Later, Jacobs, as part of a corporate reorganization, transferred the employees responsible for the JCC contract to another subsidiary and caused the new subsidiary to obtain a contractor’s license, while permitting the Facilities license to expire. Facilities remained the signatory on the JCC contract until a year later, when the parties entered into an assignment to the new, licensed subsidiary. JCC sued under Bus. & Prof. Code 7031(b), which requires an unlicensed contractor to disgorge its compensation. Defendants contended that Facilities had “internally” assigned the contract to the new subsidiary prior to expiration of its license; JCC ratified the internal assignment when it consented to the assignment to the new subsidiary; and Facilities had “substantially complied” with the law. After the jury found for defendants on the other defenses, the substantial compliance issue was not decidedd. The court of appeal reversed, concluding Facilities violated the statute when it continued to act as the contracting party after its license expired, and remanded for a hearing on substantial compliance. View "Judicial Council of Cal. v. Jacobs Facilities, Inc." on Justia Law

Defendants Spanish Inn, Inc. (Spanish Inn), Hormoz Ramy, and Nejat Kohan owned or otherwise held an interest in the Spanish Inn Hotel property in Palm Springs. In order to renovate and rehabilitate the property, Spanish Inn borrowed $6 million from Nara Bank under a written construction loan agreement. To secure the loan, Nara Bank recorded a construction deed of trust against the property. To protect its construction deed of trust, Nara Bank required that Spanish Inn procure a lender's title insurance policy to protect against loss resulting from mechanic's liens. First American Title Insurance Company (First American) issued the policy. Before it would do so, however, First American required that defendants agree to indemnify it if any mechanic's liens were recorded against the property due to the contractor's or the owners' failure to pay for work furnished to the project. In this appeal, the project's developers challenged the trial court's grant of summary adjudication in favor of the title insurer, which sought contractual indemnity from the developers for legal expenses incurred in defending the project's construction lender against mechanic's lien foreclosure actions. The developers argued the trial court erred because triable issues of fact existed regarding whether the mechanic's lien claims were covered by the title policy and regarding the amount of the title insurer's damages. Finding no error, the Court of Appeal affirmed. View "First American Title Ins. Co. v. Spanish Inn" on Justia Law

Plaintiffs Robert Coldren and his wife Brook sued defendants Hart, King & Coldren, Inc. (HKC) and William Hart asserting several causes of action arising out of Coldren’s departure from his law practice at HKC. Defendants appealed an order disqualifying HKC’s counsel, Grant, Genovese & Barratta LLP (Grant Genovese), who had been representing both Hart and HKC. The court held there was an unwaivable actual conflict between the two. The court concluded a conflict existed because Coldren was a 50 percent shareholder of HKC, and HKC would have duties to Coldren that were in conflict with Hart’s interests in defeating the litigation. Accordingly, the court ordered Hart to confer with Coldren on the appointment of “neutral” counsel for HKC. The Court of Appeal reversed: Coldren sued both Hart and HKC directly, "not derivatively," on essentially the same claims. The Court surmised Hart’s interest was perfectly aligned with HKC’s interest in seeing Coldren’s claims defeated. Coldren’s contended he could sue his company and then, because he is a 50 percent shareholder, have a say in its defense. "That is not the law." Moreover, the COurt concluded Grant Genovese’s duty of loyalty, as counsel for HKC, ran to HKC, not its shareholders. HKC was free to defend itself and assert relevant counter claims to the detriment of Coldren. View "Coldren v. Hart, King & Coldren" on Justia Law