Frampton v. Baer CA2/6 ( 2014 )

Filed 1/23/14 Frampton v. Baer CA2/6
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified
for publication or ordered published for purposes of rule 8.1115.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
SECOND APPELLATE DISTRICT
DIVISION SIX
KEVIN FRAMPTON, 2d Civil No. B245833
(Super. Ct. No. 1303311)
Appellant, Cross-Respondent, (Santa Barbara County)
v.
MERIDITH BAER,
Respondent, Cross-Complainant.
This is the second appeal in this matter. In the first appeal, Kevin Frampton
appealed from the judgment entered in favor of Meribear Productions, Inc. (Meribear),
dba Meridith Baer & Associates, following a court trial.1 Frampton and Meribear sued
each other for breach of contract. The judgment awarded damages to Meribear in the
amount of the contract price - $68,000. In an unpublished opinion (Frampton v. Baer
(Jan. 17, 2012, B228002), we reversed the $68,000 damages award and remanded the
matter for retrial on the amount of damages. We affirmed in all other respects.
1
Frampton erroneously sued Meribear as "Meridith Baer, individually and dba
Meridith Baer & Associates." The judgment correctly named Meribear as the
defendant.
After retrial, the court awarded Meribear damages of $41,480. Frampton
appeals from the judgment incorporating this award, and Meribear cross-appeals. We
affirm.
Evidence at Original Trial2
Frampton is a developer of custom homes in Montecito. In the summer of
2008, he put on the market a newly constructed, unfurnished 11,000-square-foot home
(the home). To increase its appeal to potential buyers, Frampton hired Meribear to
"stage" the home with temporary furnishings. Meridith Baer (Baer) is the founder and
owner of Meribear.
On September 22, 2008, the parties entered into a written contract (the
contract). In consideration of $68,000, Meribear agreed to provide "for design and
decorating services, and the delivery, installation and rental of furniture, antiques, fine
art, linens, rugs, lighting, temporary window treatments, potted plants and/or other
furnishings ('the Inventory')." The contract required Frampton to pay Meribear
$40,000 upon its signing and $28,000 upon completion of the staging on
"approximately October 6, 2008." Frampton used a credit card to pay the $40,000
deposit. The total payment of $68,000 would cover both the staging and the lease of
the Inventory for a six-month period beginning on October 6, 2008, and ending on
April 5, 2009 (the free-rental period). If Frampton wanted to continue to lease the
Inventory after the free-rental period, the contract required him to pay monthly rent of
$6,480. At any time, Frampton could cancel the lease by giving a 15-day written
notice.
Baer estimated that it would take from five to seven truckloads of Inventory to
stage the home. On September 28, 2008, Frampton inspected the first truckload
delivered to the home. He testified: "I was shocked, dismayed, confused. The
2
The summary of the evidence presented at the original trial, as well as the procedural
history through the conclusion of that trial, is based on pages two through six of our
opinion in the first appeal.
2
condition of the material was chipped, broken, damaged, worn, old." Frampton
complained to Baer.
On September 29, 2009, Baer drove to the home to try to sort things out. When
she arrived, one of her trucks was there to deliver a second truckload of Inventory.
Baer's workers told her that Frampton would not let them unload the truck. Baer met
with Frampton and arranged for the unloading of the second truckload. She agreed to
remove the pieces that Frampton found unsatisfactory. Since two truckloads of
Inventory had been delivered, not all of the unsatisfactory pieces could fit into the
single truck that was there. The truck left with a full load, and Baer told Frampton that
the remaining unsatisfactory pieces would be removed by the truck that would deliver
the third truckload of Inventory.
On September 30, 2008, Frampton emailed Baer that, after inspecting the
second truckload of Inventory, he felt "strongly that we need to stop the process at this
point." Frampton asked Baer when her "truck can pick the items up." Baer interpreted
the email as meaning that Frampton was " 'not going forward with the staging.' "
On October 3, 2008, Baer discovered that Frampton had canceled the $40,000
credit card payment made when the contract was signed. Later that same day,
Meribear's counsel emailed and faxed a letter to Frampton. Counsel wrote:
"Unfortunately, you have chosen to interfere with [Meribear's] ability to complete the
job and accordingly . . . we are hereby declaring you in default and we are accordingly
terminating the contract."
On October 6, 2008, Meribear removed its furnishings from the home. The
furnishings "went into other jobs." In November 2008 approximately 65 to 70 percent
of the Inventory was used to stage a home in Hot Springs. This staging was still in
place at the time of trial.
Frampton's Complaint and Meribear's Cross-Complaint
In October 2008 Frampton filed a complaint for breach of contract against
Meribear. Frampton claimed that Meribear had breached the contract by "twice
3
deliver[ing] furniture and furnishings that did not match the quality or characteristics
agreed to be provided." Meribear filed a cross-complaint against Frampton for breach
of contract.
Trial Court's Decision
The trial court decided that Meribear had not breached the contract. On the
other hand, it concluded that Frampton had "materially breached the Contract by
refusing to allow Meribear to complete the staging and by refusing to pay Meribear the
contract price for its services." The court awarded Meribear damages "in the amount
of the Contract's bargained for price for the staging fees, $68,000."
First Appeal
Frampton appealed from the judgment; respondent did not cross-appeal. In
reversing the $68,000 damages award, we concluded that "Meribear was entitled to
recover its lost profits and the costs that it had actually incurred, not the full contract
price." (Slip Op., p. 13.) We reasoned: "When Frampton prevented Meribear from
completing the staging of the home, Meribear's performance under the contract was
not substantially complete. Baer estimated that it would take from five to seven
truckloads of Inventory to stage the home. . . . Meribear had delivered two truckloads
and had removed one truckload of Inventory. Thus, to complete the staging, Meribear
needed to deliver four to six more truckloads of inventory. Furthermore, the contract
price included a six-month lease of the Inventory. The lease was supposed to begin on
October 6, 2008, the same day that Meribear removed the remainder of the Inventory
from the home. [¶] . . . During the six-month period that the Inventory was supposed
to be leased to Frampton for the contract price, Meribear mitigated damages by using
the Inventory to stage other homes." (Slip Op., p. 14.) We remanded the matter "for
retrial on the amount of damages." (Slip Op., p. 15.)
Evidence and Argument at Retrial
At the retrial of the damages issue, Baer testified that "90 percent of the job was
done before [Meribear] started to install [the Inventory inside the home]." In
4
connection with the project, Baer claimed that Meribear had paid the following
"salaries": $6,800 to Brett Baer as commission for bringing Frampton's business to
Meribear; $6,800 to Patti Pierce, the project designer; $2,500 to Diana Green, another
designer; $600 to Anna Viola for 30 hours of office work at $20 per hour; $900 to
Ianne Diwa, Meribear's bookkeeper, for 30 hours of work at $30 per hour; $800 to
Emily Baker, an art expert, for 40 hours of work at $20 per hour; $900 to Negin
Dumoulin, Meribear's attorney; and $7,650 to Meribear's crew for 510 hours of work
at $15 per hour. Baer explained that the crew pulled the Inventory from Meribear's
warehouse, wrapped it, transported it to the home, installed it on the premises, and
returned it to the warehouse after the termination of the contract. Baer personally
worked 70 hours on the project at $400 per hour for a total of $28,000. Meribear had
not yet paid her the $28,000.
Baer testified that Meribear had incurred travel expenses of $6,000 plus an
additional expense of $2,500 for moving some of Frampton's personal furnishings
from his residence to the home. Meribear's overhead was $5,000.
Based on Baer's testimony, Meribear's total cost for the project was $68,450,
i.e., $450.00 more than the contract price. Meribear did not produce any documentary
evidence in support of its alleged expenses.
The parties stipulated that the home was sold in May 2012. Meribear argued
that, if Frampton had not breached the contract, "the staging would have been
successful . . . and . . . would have continued until at least May of 2012 when the
house was sold." The free rental period ended on April 5, 2008. For the 37 months
from that date until May 2012, Meribear maintained that it was entitled to recover its
"lost profits" at the contractual rent of $6,480 per month for a total of $239,760. In
view of its alleged costs of approximately $68,000, Meribear requested damages of
$307,760 ($239,760 + $68,000 = $307,760).
5
Trial Court's Decision on Retrial
The trial court filed an 11-page document entitled "Decision." It found that
Baer was not a credible witness and that her alleged expenses "seemed very
significantly overstated." The court continued: "[T]he contract was signed on 9/22/08
and [Frampton's] breach was before 10/2/08; the Court of Appeal appears to have
correctly assumed that the contract price overstated the actual damages on this very
short contract; that is to say the damages should have been less than the $68,000 to
meet the particular facts of this contract; on the other hand there was the necessity to
pay salaries and some rental sum should [be] permitted, particularly when the fact is
that a lot of the work is done early on." The court awarded Meribear damages of
$41,480, consisting of $35,000 for "salaries" and $6,480 for one month's rental of the
Inventory. The court awarded no damages for lost profits.
FRAMPTON'S APPEAL
Trial Court's Alleged Failure to Follow the Law of the Case
The rules of law established on matters properly presented in the first appeal are
the law of the case, and the trial court was required to follow these rules in its retrial of
the damages issue. (Lucky United Properties Investments, Inc. v. Lee (2013) 213
Cal. App. 4th 635, 651.) Frampton contends that the trial court failed to follow the rule
that "Meribear was entitled to recover its lost profits and the costs that it had actually
incurred, not the full contract price." (Slip Op., p. 13.) Frampton argues that the trial
court "applied its own 'common sense' to make an 'appropriate' award." His argument
is based on the following excerpt from the trial court's decision: "The law is clear; no
fixed standard exists for deciding the amount of the damages; the fact finder must use
its judgment to decide a reasonable amount based on the evidence and common sense.
In this case the damage numbers sought by Meribear have been overstated and the
court has used its common sense based upon the evidence to set sums that are
appropriate."
6
The above excerpt does not show that the trial court disregarded the law of the
case that "Meribear was entitled to recover its lost profits and the costs that it had
actually incurred, not the full contract price." (Slip Op., p. 13.) We presume that the
court was aware of the law of the case doctrine and did not violate it. (Cahill v. San
Diego Gas & Elec. Co. (2011) 194 Cal. App. 4th 939, 956.) The court used its
"common sense based upon the evidence" to determine Meribear's lost profits, if any,
and the costs that it had actually incurred.
Trial Court's Alleged Failure to Exclude
Baer's Testimony for Discovery Violation
The trial court overruled Frampton's objection that Baer's testimony concerning
Meribear's costs was based on "documents that she's reviewed that she did not bring or
produce in discovery." Frampton argues that, because of this discovery violation, the
trial court should have excluded Baer's testimony.
Frampton has failed to carry his burden of establishing trial court error. He has
not cited any portion of the record showing that during discovery Meribear was asked
to produce, but did not produce, the documents in question and that Frampton filed a
motion to compel discovery. (See Cal. Rules of Court, rule 3.1348(a) ["The court may
award sanctions under the Discovery Act in favor of a party who files a motion to
compel discovery"].) Nor has Frampton cited any legal authority requiring the court to
exclude Baer's testimony. " 'A judgment or order of the lower court is presumed
correct.' " (Denham v. Superior Court (1970) 2 Cal. 3d 557, 564.) "To demonstrate
error, appellant must present meaningful legal analysis supported by citations to
authority and citations to facts in the record that support the claim of error.
[Citations.]" (In re S.C. (2006) 138 Cal. App. 4th 396, 408.) "If a party fails to support
an argument with the necessary citations to the record, that portion of the brief may be
stricken and the argument deemed to have been waived. [Citation.]" (Duarte v. Chino
Community Hospital (1999) 72 Cal. App. 4th 849, 856.) "When an issue is unsupported
by pertinent or cognizable legal argument it may be deemed abandoned and discussion
7
by the reviewing court is unnecessary. [Citations.]" (Landry v. Berryessa Union
School Dist. (1995) 39 Cal. App. 4th 691, 699 -700.)
Best Evidence Rule
Frampton contends that the trial court erroneously overruled his objection that
Baer's testimony about Meribear's costs violated the former "best evidence rule," now
the secondary evidence rule (Evid. Code, § 1520 et seq.), because she had failed to
bring into court the documents upon which her testimony was based. The secondary
evidence rule provides: "Except as otherwise provided by statute, oral testimony is not
admissible to prove the content of a writing." (Id., § 1523, subd. (a).)
"We review a trial court's rulings on the admission and exclusion
of evidence under the abuse of discretion standard. [Citation.]" (People v.
Thompson (2010) 49 Cal. 4th 79, 128.) "A trial court abuses its discretion only where
its action is clearly wrong and without reasonable basis. [Citation.]" (Pipefitters
Local No. 636 Defined Benefit Plan v. Oakley, Inc. (2010) 180 Cal. App. 4th 1542,
1548.)
The trial court did not abuse its discretion. The secondary evidence rule applies
only when secondary evidence is offered to prove the content of a writing. Baer's
testimony was offered to prove the costs that Meribear had incurred in connection with
the staging of the home, not to prove the content of any writing.
Hearsay
Frampton maintains that, in violation of the hearsay rule, the trial court
erroneously admitted Meribear's Exhibit 80, a one page document that summarized its
costs. Baer prepared Exhibit 80, and she referred to the document during her
testimony The trial court stated that Exhibit 80 "will be admitted just as if she wrote it
on the board . . . on the theory that it's a method to preserve the witness's testimony."
The admission of Exhibit 80 did not violate the hearsay rule. Evidence Code
section 1200, subdivision (a) defines "hearsay evidence" as "evidence of a statement
that was made other than by a witness while testifying at the hearing and that is offered
8
to prove the truth of the matter stated." Exhibit 80 was not an out-of-court statement;
it was an integral part of Baer's testimony. She discussed the costs listed in the exhibit
and explained how she had calculated them. Furthermore, the trial court did not admit
Exhibit 80 to prove the truth of the matters stated therein; it admitted the exhibit as "a
method to preserve the witness's testimony."
Sufficiency of the Evidence
Frampton asserts that the evidence is insufficient to support the trial court's
damages awards of $35,000 for salaries and $6,480 for one month's rental of the
inventory. "[W]e apply the familiar substantial evidence standard of review: We view
all of the evidence in the light most favorable to the judgment, drawing every
reasonable inference and resolving every conflict to . . . support the judgment.
[Citation.]" (Jonkey v. Carignan Const. Co. (2006) 139 Cal. App. 4th 20, 24.) "The
term 'substantial evidence' means such relevant evidence as a reasonable mind would
accept as adequate to support a conclusion; it is evidence which is reasonable in
nature, credible, and of solid value. [Citation.]" (In re J.K. (2009) 174 Cal. App. 4th
1426, 1433.) " 'The ultimate determination is whether a reasonable trier of fact could
have found for the respondent based on the whole record. [Citation.]' " (In re Estate
of Young (2008) 160 Cal. App. 4th 62, 76.)
Substantial evidence supports the damages award of one month's rental.
According to the contract, the rental value of the Inventory was $6,480 per month.
The trial court could reasonably infer that, as a result of Frampton's breach of the
contract, the Inventory sat idle for one month without generating any rental income. In
our previous opinion we noted that in November 2008, one month after Frampton's
breach, approximately 65 to 70 percent of the Inventory was used to stage a home in
Hot Springs. (Slip Op., p. 5)
Frampton argues that there is no reasonable basis for the rental damages award
because the contract provided that he would not pay rent for the first six months of the
staging. The argument is devoid of merit. The free rental period applied only if
9
Frampton complied with the contract, and he breached it without paying any portion of
the $68,000 contract price.
Substantial evidence also supports the damages award of $35,000 for "salaries."
Baer testified that "90 percent of the job was done before [Meribear] started to install
[the Inventory inside the home]." She also testified that Meribear had paid $26,950 in
"salaries" and that it owed her $28,000 for her own services.
Frampton contends that we should reject Baer's testimony concerning "salaries"
because it "was untrustworthy at best." He requests that we consider Baer's "
'credibility' by comparing her 'statements previously made [at the original trial],' with
the inconsistent evidence given in this proceeding [the retrial] and then find that there
is no substantial evidence to support an award [of damages for salaries]." Frampton
misunderstands the role of an appellate court. "We do not retry cases on appeal . . . ."
(FLIR Systems, Inc. v. Parrish (2009) 174 Cal. App. 4th 1270, 1276.) "The trier of fact
determines the credibility of witnesses, weighs the evidence, and resolves factual
conflicts. We cannot reject the testimony of a witness that the trier of fact chooses to
believe unless the testimony is physically impossible or its falsity is apparent without
resorting to inferences or deductions. As part of its task, the trier of fact may [as it did
here] believe and accept as true only part of a witness's testimony and disregard the
rest. On appeal, we must accept that part of the testimony which supports the
judgment. [Citation.]" (In re Daniel G. (2004) 120 Cal. App. 4th 824, 830.)
MERIBEAR'S CROSS-APPEAL
Meribear Cannot Recover More than the Contract Price of $68,000
Meribear argues that "it is entitled to damages of $307,760, which this Court is
empowered to award, without a second retrial." Meribear, however, is precluded from
seeking damages greater than $68,000, the amount awarded in the original trial,
because it did not cross-appeal from the original $68,000 judgment. "[I]t is the general
rule that a respondent who has not appealed from the judgment may not urge error on
appeal. [Citations.] . . . Here, without [cross-appealing from the original $68,000
10
judgment], respondent seeks not to save the judgment but to overthrow it. This cannot
be done; we will not review [Meribear's] contentions of error. [Citations.]"
(California State Employees' Assn. v. State Personnel Bd. (1986) 178 Cal. App. 3d 372,
382, fn. 7.) Furthermore, since it is the law of the case that Meribear was not entitled
to recover the contract price of $68,000 (Slip Op., pp. 13-14), it is also the law of the
case that Meribear cannot recover more than the contract price.
In any event, Meribear's alleged entitlement to damages greater than $68,000 is
based on speculation: if Frampton had not breached the contract, he would have leased
the Inventory at $6,480 per month from the end of the free rental period until the home
was sold in May 2012, even though he had no obligation to do so. " ' "It is
fundamental that [contract] damages which are speculative, remote, imaginary,
contingent, or merely possible cannot serve as a legal basis for recovery." '
[Citation.]" (Scott v. Pacific Gas & Electric Co. (1995) 11 Cal. 4th 454, 473,
disapproved on another ground in Guz v. Bechtel Nat. Inc.(2000) 24 Cal. 4th 317, 352,
fn. 17; see also Civ. Code, § 3301 ["No damages can be recovered for a breach of
contract which are not clearly ascertainable in both their nature and origin"].)
Substantial Completion of Performance
At the retrial Baer testified that Meribear had completed 90 percent of the work
before it started to install the inventory inside the home. In view of this testimony,
Meribear contends that it is entitled to recover the full contract price of $68,000
because "it did, in fact substantially complete its work under the contract." But it is
the law of the case that, "[w]hen [Frampton] prevented Meribear from completing the
staging of the home, Meribear's performance under the contract was not substantially
complete." (Slip Op., p. 14.)
Lost Volume Seller
Meribear contends that the trial court erroneously concluded that it was not a
lost volume seller. The lost volume seller doctrine applies to the sale of goods.
Pursuant to this doctrine, if the buyer breaches the sales contract and the seller resells
11
the goods at a profit, the seller is entitled to recover its anticipated profit from the
breaching buyer if it proves "that had the breaching buyer performed, the seller would
have realized profits from two sales. [Citation.]" (National Controls, Inc. v.
Commodore Bus. Machines, Inc. (1985) 163 Cal. App. 3d 688, 697; see also Teradyne,
Inc. v. Teledyne Industries, Inc. (1st Cir. 1982) 676 F.2d 865, 868, fns. omitted ["it is
universally agreed that in a case where after the buyer's default a seller resells the
goods, the proceeds of the resale are not to be credited to the buyer if the seller is
a lost volume seller - that is, one who had there been no breach by the buyer, could and
would have had the benefit of both the original contract and the resale contract"].)
Meribear maintains that it qualifies as a lost volume seller because if Frampton
had not breached the contract and had leased the Inventory for the six-month free
rental period, Meribear would not "have turned down work [during this period]
because of the Frampton staging." Accordingly, Meribear asserts that its "damages
should not be reduced even if Meribear re-deployed certain of its inventory in other
homes during the time the inventory would have been used in the Frampton home had
Mr. Frampton not breached the contract."
The trial court concluded, and we agree, that the lost volume seller doctrine
does not apply to Meribear because "[t]hat is a doctrine for dealings between
merchants in the sale of goods, in Division 2 of the UCC . . . ." (See Cal. U. Com.
Code § 2708, subd. (2); 4 Witkin, Summary of Cal. Law (10th ed. 2005) Sales, § 191,
p. 170 ["When a buyer repudiates a fixed price contract to purchase goods, U.C.C.
2708(2) permits a seller to recover lost profits upon establishing that he or she is a
'lost volume' seller, i.e., a seller who would have made the sale to a third party
regardless of the buyer's breach"].)
Even if the lost volume seller doctrine had applied to Meribear, substantial
evidence would have supported the trial court's finding that Meribear had failed to
prove its entitlement to an award for lost profits. According to Baer's testimony, the
cost of performing the contract exceeded the $68,000 contract price. Baer testified
12
that Meribear had expected that "the profit in the project would come from the
monthly rental[]" for the Inventory that Frampton would pay after the expiration of the
free rental period. But Frampton had no obligation to lease the Inventory after that
date.
Disposition
The judgment is affirmed. The parties shall bear their own costs on
appeal.
NOT TO BE PUBLISHED.
YEGAN, J.
We concur:
GILBERT, P.J.
PERREN, J.
13
Thomas P. Anderle, Judge
Superior Court County of Santa Barbara
______________________________
David W. Magnusson; Haws, Record & Magnusson, for Appellant and
Cross-Respondent..
Leviton Law Group, Stuart L. Leviton, for Respondent and Cross-
Appellant.
14