Vestar/Kimco Tustin v. Sesbar CA4/3 ( 2014 )

Filed 5/30/14 Vestar/Kimco Tustin v. Sesbar CA4/3
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
VESTAR/KIMCO TUSTIN, L.P.,
Plaintiff and Appellant, G048831
v. (Super. Ct. No. 30-2011-00514253)
AYOUB SESAR, OPINION
Defendant and Respondent.
Appeal from a judgment of the Superior Court of Orange County, Robert J.
Moss, Judge. Reversed.
Bewley, Lassleben & Miller and Ernie Zachary Park for Plaintiff and
Appellant.
Ghods Law Firm, Mohammed K. Ghods, William A. Stahr and Ruben
Escobedo III for Defendant and Respondent.
* * *
The trial court sustained defendant Ayoub Sesar’s demurrer to a breach of
lease cause of action and overruled his demurrer to a breach of guaranty cause of action.
Plaintiff Vestar/Kimco Tustin, L.P. (Vestar) subsequently filed a voluntary dismissal of
its complaint on the date of trial. The court thereafter awarded Sesar attorney fees in
connection with the breach of lease cause of action. Vestar appealed, contending the
court erred in sustaining the demurrer to the breach of lease cause of action, and as a
result, Sesar was not a prevailing party entitled to attorney fees. We agree and reverse.
I
FACTS AND PROCEDURAL BACKGROUND
Vestar filed its initial complaint against Kboby, Inc., Syed H. Miremad; Pei
Chun Lin; Ayoub Sesar,1and Does one through 20. The complaint alleged two causes of
action. As to Kboby, Inc. and Does one through 10, Vestar alleged a cause of action for
breach of lease. As to Sesar, Miremad, Lin, and Does 11 through 20, the complaint
alleged breach of guaranty.
Vestar filed a first amended complaint in response to Sesar’s demurrer to
the initial complaint. Sesar demurred to the four-page first amended complaint, which
again alleged causes of action for breach of lease and breach of guaranty. The court
sustained the demurrer to the breach of lease cause of action without leave to amend and
overruled the demurrer to the breach of guaranty cause of action. Approximately eight
months later, on December 4, 2012, the clerk of the court entered Vestar’s voluntary
dismissal without prejudice on the date of trial and after counsel met with the assigned
trial judge in chambers.
Sesar subsequently filed a motion for attorney fees based on provisions in
the lease and the guaranty. (See Civ. Code, § 1717; all undesignated statutory references
are to the Civil Code.) Vestar opposed the motion, contending Sesar’s demurrer to the
1 Sesar was sued as Ayoub Sesur. Sesar is the only defendant appearing on
appeal.
2
first amended complaint was overruled2 and as it had voluntarily dismissed the
complaint, Civil Code section 1717, subdivision (b)(2)3 precludes an award of attorney
fees. Vestar also asserted that if the court decided to award attorney fees, the amount
requested was “grossly excessive.” In a supplemental brief, Vestar argued that although
the court had sustained the demurrer to the breach of lease cause of action, it never
entered a judgment on that action and therefore Vestar’s voluntary dismissal was as to
both causes of action.
The court’s tentative ruling on Sesar’s motion for $32,424 in attorney fees
was to grant it in part and deny it in part. The court reasoned that Sesar was the
prevailing party on the cause of action for breach of lease and was entitled to attorney
fees under the terms of the lease and section 1717, but there was no prevailing party on
the breach of guaranty, that action having been voluntarily dismissed. The court
calculated the fees incurred in defending the breach of lease cause of action at
$16,875.50. The hearing on the motion was continued and the parties filed supplemental
briefs. Vestar suggested the court vacate the dismissal of the first cause of action and
enter a judgment in Sesar’s favor on that cause of action, which would preserve the
court’s order awarding attorney fees to Sesar and permit Vestar to appeal from the
judgment.
The court’s May 17, 2013 minute order stated the dismissal on the breach
of lease cause of action was vacated and entry of judgment dismissing that cause of
action was ordered. Additionally, the court awarded Sesar $22,230 in attorney fees. That
figure included the amount set forth in the court’s tentative ruling plus $5,742.50 incurred
by Sesar during supplemental briefing. Judgment was thereafter entered on July 15,
2 As noted above, only the demurrer to the breach of guaranty was
overruled.
3 “Where an action has been voluntarily dismissed or dismissed pursuant to
a settlement of the case, there shall be no prevailing party for purposes of this section.”
(§ 1717, subd. (b)(2).)
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2013. The judgment stated the earlier dismissal on the breach of lease cause of action
was vacated and “[i]n lieu of said dismissal, a judgment of dismissal is entered in favor of
. . . Sesar and against [Vestar] as to the First Cause of Action of the First Amended
Complaint based upon the court having previously sustained [Sesar’s] demurrer as to [the
breach of lease] cause of action without leave to amend.” On August 8, 2013, Vestar
appealed from the judgment, “including both the judgment of dismissal and the award of
attorney’s fees and costs.”
II
DISCUSSION
As a general rule, the parties to a lawsuit must pay their own attorney fees.
(Kirby v. Immoos Fire Protection, Inc. (2012) 53 Cal. 4th 1244, 1259.) An exception
exists where a contract provides for the payment of such fees. (Trope v. Katz (1995) 11
Cal. 4th 274, 279.) Section 1717 provides a clause in a contract entitling one party to
attorney fees incurred in enforcing the contract is deemed to be mutual and entitles the
prevailing party to obtain attorney fees even if the contract limits the right to the other
party. (§ 1717, subd. (a).) However, subdivision (b)(2) of section 1717 precludes finding
a defendant in a breach of contract action to be a prevailing party for purposes of
awarding attorney fees when the action was voluntarily dismissed prior to trial. (Santisas
v. Goodin (1998) 17 Cal. 4th 599, 615.)
After Vestar voluntarily dismissed its complaint on the date of trial, Sesar
filed his motion for attorney fees incurred in defending the lawsuit. Vestar’s initial
response was two-fold. First, it argued Sesar was not entitled to any attorney fees
because the matter was voluntarily dismissed. Second, Vestar claimed the amount sought
was “grossly excessive.” In response to the superior court’s tentative ruling to award
Sesar those attorney fees incurred in defending the breach of lease cause of action, given
he prevailed on his demurrer to that cause of action, Vestar urged the court to vacate its
voluntary dismissal as to the breach of lease cause of action only and to enter a new
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dismissal thereon based on the sustaining of Sesar’s demurrer to that cause of action.
Vestar urged such an action would “preserve[]” the court’s decision to award Sesar
attorney fees incurred in defending the breach of lease cause of action and permit Vestar
to appeal the propriety of the court’s decision sustaining the demurrer to that cause of
action.
A. Timeliness of the Appeal
Prior to addressing whether Sesar was entitled to an award of attorney fees
for defending against the breach of lease cause of action, the procedural history in this
matter requires us to determine whether Vestar’s appeal is timely. If it is not, we lack
jurisdiction to address the merits of Vestar’s argument and must dismiss the appeal.
(Faunce v. Cate (2013) 222 Cal. App. 4th 166, 170.) “[N]either mistake, accident,
misfortune, estoppel, nor waiver will confer appellate jurisdiction. [Citation.]” (In re
Marriage of Micalizio (1988) 199 Cal. App. 3d 662, 669.)
Sesar contends Vestar’s August 8, 2013 notice of appeal was untimely and
argues Vestar should have filed his notice of appeal within 180 days of his December 4,
2012 dismissal in order to challenge the trial court’s order sustaining the demurrer to the
breach of lease cause of action. (Cal. Rules of Court, rule 8.104(a)(1)(C).) The 180-day
period is binding, “[u]nless a statute or rule 8.108 provides otherwise.” (Cal. Rules of
Court, rule 8.104(a)(1).) Vestar takes the position it could not have appealed from its
own voluntary dismissal. Although voluntary dismissals have not traditionally been
considered judgments from which a plaintiff may appeal (see Stewart v. Colonial
Western Agency, Inc. (2001) 87 Cal. App. 4th 1006, 1012), more recently it has been
found a trial “court’s order sustaining . . . demurrers without leave to amend, combined
with the dismissal of the action, had the legal effect of a final, appealable order” (Gutkin
v. University of Southern California (2002) 101 Cal. App. 4th 967, 974).
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Although no extension of the time to appeal listed in rule 8.108 occurred,
the court’s action in entering its May 17, 2013 minute order vacating the December 4,
2012 dismissal of the breach of lease cause of action prior to expiration of the time to
appeal operated to prohibit an appeal from the earlier dismissal. (Ferraro v. Pacific Fin.
Corp. (1970) 8 Cal. App. 3d 339, 345 [a party cannot appeal a vacated judgment].)
Because the court’s action occurred at a time when Vestar could still have filed a timely
notice of appeal, there is no reason to deny Vestar the right to appeal from the portion of
the July 15, 2013 judgment entering a dismissal of the breach of lease cause of action
based on the court having previously sustained, without leave to amend, a demurrer to
that cause of action.4 Vestar timely appealed from the July 15, 2013 judgment when it
filed its August 8, 2013 notice of appeal.
B. Attorney Fees
Sesar was awarded attorney fees because he prevailed on his demurrer to
the breach of lease cause of action. Vestar contends the trial court erred because Sesar
was not a defendant in that cause of action and consequently, his demurrer should not
have been sustained. As Sesar is precluded from an award of attorney fees on the breach
of guaranty cause of action, given that cause of action was voluntarily dismissed
(Santisas v. Goodin, supra, 17 Cal.4th at p. 615; § 1717, subd. (b)(2)), we review whether
the trial court erred in sustaining Sesar’s demurrer to the breach of lease cause of action.
In reviewing a trial court’s decision sustaining a demurrer, “we examine the
complaint de novo to determine whether it alleges facts sufficient to state a cause of
action under any legal theory, such facts being assumed true for this purpose.
[Citations.]” (McCall v. PacifiCare of Cal., Inc. (2001) 25 Cal. 4th 412, 415.) We also
review exhibits attached to the complaint, here the lease. (Thaler v. Household Finance
4 Sesar did not appeal from the July 15, 2013 judgment and does not argue
the court lacked authority to vacate the earlier dismissal.
6
Corp. (2000) 80 Cal. App. 4th 1093, 1101.) Additionally, we give the complaint “a
reasonable interpretation, reading it as a whole and its parts in their context. [Citation.]”
(Blank v. Kirwan (1985) 39 Cal. 3d 311, 318.)
A defendant may demur to a cause of action if it fails to state a cause of
action or is uncertain. (Code Civ. Proc., § 430.10, subds. (e) [failure to state a cause of
action], (f) [uncertain].) For purposes of a demurrer, “‘uncertain’ includes ambiguous
and intelligible.” (Ibid.) According to Sesar’s demurrer, the breach of lease cause of
action was uncertain and failed to state a cause of action. However, in the section of his
points and authorities directed to the breach of lease cause of action, he did not argue
uncertainty. Rather, he argued Vestar failed to allege facts supporting the elements of
breach of contract. In support of his contention, Sesar quoted a paragraph in the breach
of lease cause of action: “On or about March 15, 2011, plaintiff and defendants, and each
of them, entered into a written agreement (‘the Lease’) under the terms of which
defendants, and each of them would rent from Plaintiff the premises. Defendants, and
each of them, have breached the Lease by vacating the Premises prior to the termination
thereof and by failing to pay the sums due thereunder.” In response to Sesar’s demurrer,
Vestar pointed out the lease attached to the complaint showed Kboby, Inc. was the only
defendant who was a party to the lease.
The court erred in sustaining Sesar’s demurrer to the breach of lease cause
of action. In compliance with California Rules of Court, rule 2.112, that cause of action
contained a heading clearly stating the cause of action was against Kboby, Inc. and Does
one through 10. Sesar was not named as a defendant in that cause of action, a fact driven
home by the heading for the breach of guaranty cause of action which stated it was
against Miremad, Lin, Sesar, and Does 11 through 20. Giving the complaint “a
reasonable interpretation, reading it as a whole and its parts in their context” (Blank v.
Kirwan, supra, 39 Cal.3d at p. 318), the reference in the breach of lease cause of action to
“[d]efendants, and each of them” must be interpreted as meaning the defendants listed in
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the heading to that cause of action. Sesar was not a defendant in the breach of lease
cause of action. His demurrer to a cause of action in which he was not a defendant
should have been overruled.
It must have been obvious to Sesar that if Vestar could not prevail on the
breach of lease cause of action against Kboby, Inc., Sesar would not have to pay anything
on the breach of guaranty action. Thus he apparently attempted to step into Kboby Inc.’s
shoes at the demurrer stage in the breach of lease cause of action even though he was not
a defendant in that cause of action.
Because Sesar could not have prevailed on his demurrer to the breach of
lease cause of action, the court erred in awarding him attorney fees under section 1717.
(Poseidon Development, Inc. v. Woodland Lane Estates, LLC (2007) 152 Cal. App. 4th
1106, 1120.) We therefore reverse the attorney fee award.
III
DISPOSITION
The judgment is reversed. Vestar shall recover its costs on appeal.
MOORE, J.
WE CONCUR:
RYLAARSDAM, ACTING P. J.
BEDSWORTH, J.
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