Case Number: GC051054    Hearing Date: October 31, 2014    Dept: NCD

TENTATIVE RULING (10/31/14)
#4
GC 051054
YOUNG v. NEWLIFE CONSULTING, LLC

Defendant New Life Consulting, LLC’s Motion for New Trial

TENTATIVE:
Motion for new trial is DENIED.
With respect to the argument that there was insufficient of the evidence to justify the decision, the moving papers fail to establish that the decision was not supported by the evidence, and the court, after weighing the evidence, cannot find from the entire record, including reasonable inferences to be drawn therefrom, that the court should have reached a different decision.

With respect to the argument that there was error in law, the court finds no ambiguity in its Statement of Decision, and declines to modify it. The court also notes that the ambiguity urged, even if an ambiguity were found, is not of a nature that materially affects the substantial rights of the aggrieved party, which party would be subject to the identical judgment in any event.

The case went to trial before the court in July, 2014. The parties submitted post-trial briefs, and on July 28, 2014, the court issued its detailed tentative Statement of Decision. Defendants filed objections to the proposed Statement of Decision, and the court on August 20, 2014, in a detailed minute order, indicated it had reviewed the objections, and tentatively declined to modify its Statement of Decision. At a hearing on August 29, 2014, the court heard oral argument concerning oppositions to the tentative Statement of Decision, and ordered that “The Court’s Tentative Statement of Decision becomes the final Statement of Decision.”

Judgment was accordingly entered on September 8, 2014, the court ordering that judgment be entered in favor of plaintiff JBY International, Inc. and against NewLife Consulting, LLC in the sum of $25,000, with interest to accrue from the date of judgment at the legal rate of 10% per annum, and that plaintiff JBY International, Inc. be entitled to recover costs of suit.

ANALYSIS:
CCP section 657 provides that a verdict may be vacated and any other decision may be modified or vacated and a new or further trial granted on all or part of the issues, on the application of the party aggrieved for a cause, including
“6. Insufficiency of the evidence to justify the verdict or other decision, or the verdict or other decision is against law.”

Defendant also relies on CCP § 662, which provides:
“In ruling on such motion, in a cause tried without a jury, the court may, on such terms as may be just, change or add to the statement of decision, modify the judgment, in whole or in part, vacate the judgment, in whole or in part, and grant a new trial on all or part of the issues, or, in lieu of granting a new trial, may vacate and set aside the statement of decision and judgment and reopen the case for further proceedings and the introduction of additional evidence with the same effect as if the case had been reopened after the submission thereof and before a decision had been filed or judgment rendered. Any judgment thereafter entered shall be subject to the provisions of sections 657 and 659.”

In considering a motion for a new trial, the evidence must be construed in favor of the prevailing party and all reasonable inferences must be presumed in favor of the judgment. Kuhn v. Department of General Services (1994) 22 Cal. App. 4th 1627, 1632. A new trial may only be granted on a finding of prejudicial error, and there is no discretion to grant a new trial for harmless error. Sherman v. Kinetic Concepts, Inc. (1998) 67 Cal.App.4th 1152, 1161.

Sufficiency of the Evidence
The motion states it is based on insufficiency of the evidence, but it is not clear how there was insufficiency of the evidence to justify the court’s decision, and the motion basically argues that there was error in law, as discussed below, and that certain issues were not addressed in the Statement of Decision, including whether the signatures of all parties were contemplated as being a condition precedent to the validity of Trial Exhibit 1.

With respect to a motion for new trial on the ground of insufficiency of the evidence, CCP § 657 specifically provides:
“A new trial shall not be granted upon the ground of insufficiency of the evidence to justify the verdict or other decision, nor upon the ground of excessive or inadequate damages, unless after weighing the evidence the court is convinced from the entire record, including reasonable inferences therefrom, that the court or jury clearly should have reached a different verdict or decision.”

On review, the appellate court will accept the trial court’s credibility determinations if supported by substantial evidence. Enyart v. City of Los Angeles (Second District 1999) 17 Cal.App.4th 499, 507.

The Court finds that there was sufficient evidence for the court to conclude that the contract in this case was not formed because plaintiffs revoked their acceptance prior to defendant executing the document, and that the agreement was not final until such execution. This basic finding and conclusion is discussed in great detail in the Statement of Decision.

Error in Law
The argument seems to be that the court erred in its Statement of Decision to the extent it stated:
“Plaintiffs contend that the revocation here was timely and was clearly communicated to counsel for Park Place, Mr. Kim, and that the necessity for the revocation of the assents to the settlement agreement (the assents of JBY’s principals, William and Jennifer Young) arose from ‘unilateral mistake.’ Plaintiffs’ Trial Brief 5:6-9. The Court agrees.

Further, plaintiffs cite the black letter law that governs here: ‘It is a well settled principal of contract law that an offer may be revoked by the offeror any time prior to acceptance.”
Statement of Decision, 11:15-24.

The argument seems to be that the Statement of Decision creates ambiguity with respect to whether the court finding is that there was rescission based on “unilateral mistake,” which only occurs when there is a fully formed contract, or whether the court finding is that there was never an enforceable contract to begin with.

There is no ambiguity with respect to what the court found here—in effect, that the contract was never formed—as the previous sentences in the Statement of Decision set forth in some detail how an agreement was never formed, and the succeeding sentences explain how any other result would be improper. In fact, the immediately preceding sentence states: “The manner in which this particular settlement agreement was handled is in some respects a poster child for contract failure.” Statement of Decision, 11:14-15

The court elsewhere unequivocally stated that “the purported contract was never properly formed,” and “the subject settlement agreement that is Exhibit 1 was never consummated and is not enforceable under the circumstances.” Statement of Decision, 11:7, 10:3-6

The term “unilateral mistake” basically referred to the reason that the contract was revoked, and that there was never a meeting of the minds, not a ground for rescission of a fully formed contract under Civil Code section 1689, which applies to rescission of a contract already formed:
“(b) A party to a contract may rescind the contract in the following cases:
(1) If the consent of the party rescinding, or of any party jointly contracting with him, was given by mistake, or obtained through duress, menace, fraud, or undue influence, exercised by or with the connivance of the party as to whom he rescinds, or of any other party to the contract jointly interested with such party.”

In addition, as argued in the opposition, it is not clear how this is a proper motion for a new trial or to modify the Statement of Decision, as regardless of which construction the court articulated—that the contract was never formed or that it was formed but was then rescinded based on unilateral mistake—there is no prejudice to defendant, who would in any case be unable to enforce the terms of the settlement agreement, so the judgment would not change. Under CCP § 657, a decision may be “modified or vacated, in whole or in part… for any of the following causes, materially affecting the substantial rights” of the aggrieved party. There appears to have been no material impact on the substantial rights of defendant, even if it were determined that there is ambiguity one way or another here.