Case Name: California Ranch Supermarket, Inc. v. Island Pacific Enterprises, Inc.
Case No.: 2015-1-CV-284597

I. Background

This lawsuit arises from a dispute over the sale of a supermarket. Plaintiff California Ranch Supermarket, Inc. (“California Ranch”) agreed to sell the supermarket business it operated at a leased space on Morrill Avenue in San Jose to defendant Island Pacific Enterprises, Inc. (“Island Pacific”) for the price of $250,000. Pursuant to the terms of the Purchase Agreement, Island Pacific agreed to pay an initial deposit of $25,000, an additional $75,000 upon the close of escrow, and the remaining purchase price of $150,000 in three installments payable in October, November, and December 2013. California Ranch alleges Island Pacific breached the Purchase Agreement because it took over the business but thereafter failed to pay “the remaining amount due into escrow to close the transaction” or the balance of the purchase price. (First Amended Complaint (“FAC”) at p. 3.)

In an attempt to amicably resolve their dispute, the parties participated in a mediation conducted by Judicial Arbitration and Mediation Services. (FAC at p. 3; see also FAC, Ex. A, ¶ N [dispute resolution clause in Purchase Agreement].) They reached a settlement in July 2015. (FAC, Ex. B [Settlement Agreement].)

Pursuant to the parties’ Settlement Agreement, Island Pacific agreed to deposit $75,000, “escrow costs (50-50),” and “[Board of Equalization] sales tax” before the close of escrow on August 15, 2015. (FAC, Ex. B.) Island Pacific would thereafter pay $50,000 upon “proof of release of UCC-1 by East West Bank” and then the remaining $100,000 in three, equal, monthly installments. (FAC, Ex. B.) California Ranch alleges Island Pacific breached the Settlement Agreement by failing to deposit funds in escrow by the closing date and otherwise “refus[ing]” to close escrow. (FAC at p. 3.)
California Ranch asserts one cause of action for breach of contract based on both the Purchase Agreement and the Settlement Agreement. Currently before the Court is California Ranch’s motion for summary judgment.

II. Standard of Review

A plaintiff may move for summary judgment “if it is contended that. . . there is no defense to the action or proceeding.” (Code Civ. Proc., § 437c, subd. (a)(1).) “A plaintiff [ ] has met his or her burden of showing that there is no defense to a cause of action if that party has proved each element of the cause of action entitling the party to judgment on the cause of action.” (Code Civ. Proc., § 437c, subd. (p)(1).)

“Once the plaintiff [ ] has met that burden, the burden shifts to the defendant [ ] to show that a triable issue of one or more material facts exists as to the cause of action or a defense thereto.” (Code Civ. Proc., § 437c, subd. (p)(1).) “The party opposing the summary judgment must make an independent showing by a proper declaration or by reference to a deposition or another discovery product that there is sufficient proof [ ] to raise a triable question of fact if the moving party’s evidence, standing alone, is sufficient to entitle the party to judgment.” (Wiz Technology, Inc. v. Coopers & Lybrand (2003) 106 Cal.App.4th 1, 10-11; Code Civ. Proc., § 437c, subds. (b)(2), (p)(1).)

“The motion for summary judgment shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” (Code Civ. Proc., § 437c, subd. (c).)

III. Evidentiary Matters

Island Pacific did not separately file written objections to evidence. But in its opposition, it takes issue with the fact that California Ranch relies exclusively on the declaration of its counsel and documents attached thereto. Island Pacific then proceeds to ask the Court to disregard the declaration and objects to portions thereof on various grounds, such as it “is simply a recapitulated contents [sic] of second writings [,] as well as his own delusional pontifications about which he has no personal knowledge[,] and should be inadmissible hearsay.” (Opp. at p. 9:18-20.) There are many problems with Island Pacific’s presentation.

First, “[a]ll written objections to evidence must be served and filed separately from the other papers in support of or in opposition to the motion [for summary judgment].” (Cal. Rules of Court, rule 3.1354(b).) Island Pacific did not separately file written objections to evidence. Rather, it improperly includes objections in its opposition, and so the Court need not consider them. (See Hodjat v. State Farm Mutual Automobile Insurance Co. (2012) 211 Cal.App.4th 1, 8-9.)

Second, Island Pacific does not comply with the content requirements in rule 3.1354(b) of the California Rules of Court, and its objections are rendered unintelligible as a result. More specifically, Island Pacific does not quote or set forth the objectionable statements and clearly identify the ground for objecting to each statement. Instead, Island Pacific makes conclusory characterizations about the declaration, appearing to conflate concepts such as hearsay, authenticity, and secondary evidence in the process. (See Pajaro Valley Water Management Agency v. McGrath (“Pajaro Valley”) (2005) 128 Cal.App.4th 1093, 1108.) Thus, it is impossible discern what Island Pacific’s objections are to any particular portions of or exhibits attached to the declaration of California Ranch’s counsel.

Finally, the statement of objections is full of accusations and characterizations of opposing counsel that are unprofessional, irrelevant, and not otherwise supported by the record before the Court. For example, Island Pacific states the declaration of California Ranch’s counsel consists solely of “his delusional pontifications.” (Opp. at p. 9:18-20.) The Judges of the Santa Clara County Superior Court have adopted by standing order the Santa Clara County Bar Association’s Code of Professionalism, and expect attorneys to comport themselves in accordance with the guidelines set forth therein. “Written materials submitted to the court should always be factual, concise, accurately state current law, and fairly represent the parties’ positions without unfairly attacking the opposing party or opposing counsel.” (SCCBA Code of Professionalism, § 7.) Island Pacific’s inclusion of inaccurate and unfair attacks on opposing counsel that are entirely immaterial to the legal issues before the Court is improper.

In conclusion, Island Pacific does not present proper evidentiary objections or otherwise demonstrate there is any basis for disregarding all or any portion of the declaration of California Ranch’s counsel. Thus, there are no evidentiary matters to resolve before turning to the merits of the motion.

IV. Merits of the Motion

California Ranch’s memorandum of points and authorities is not a model of clarity. It does not frame its argument with respect to the pleading and/or any articulable legal standard. Accordingly, it is necessary to first provide some context before addressing the arguments it advances.

“The pleadings play a key role in a summary judgment motion.” (Hutton v. Fidelity National Title Co. (2013) 213 Cal.App.4th 486, 493.) They “delimit the scope of the issues” that must be proven. (Ibid. [internal quotation marks and citations omitted].) For example, a party moving for summary judgment need only address the causes of action pleaded, not every “theoretical possibility” for liability. (Ibid.) Thus, in evaluating California Ranch’s motion for summary judgment, the Court must first look to California Ranch’s complaint.

The complaint purports to contain one cause of action for breach of contract. But therein, California Ranch alleges breaches of two different contracts, namely the Purchase Agreement and the Settlement Agreement, occurring at two different points in time. In other words, the first cause of action consists of “separate and distinct wrongful acts which are combined in the same cause of action.” (Lilienthal & Fowler v. Super. Ct. (1993) 12 Cal.App.4th 1848, 1854-55.) Arguably, these actually constitute two different causes of action for breach of contract. (Ibid.) In either case, because California Ranch moves for summary judgment, it must prove its claim relative to both breaches alleged. (See Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 859-60, 876.)

“[T]he elements of a cause of action for breach of contract are (1) the existence of the contract, (2) plaintiff’s performance or excuse for nonperformance, (3) defendant’s breach, and (4) the resulting damages to the plaintiff.” (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.) Accordingly, California Ranch must present evidence to prove these essential elements relative to each agreement. (See Code Civ. Proc., § 437c, subd. (p)(1).)

With respect to the Purchase Agreement, it simply is not addressed in California Ranch’s memorandum of points and authorities. This is problematic because the first cause of action is based on breach of the Purchase Agreement and the Purchase Agreement may have some relationship to the Settlement Agreement.

As for the Settlement Agreement, although California Ranch presents a copy of a document bearing that title, it is not apparent the document constitutes a contract. (See Civ. Code, § 1550 [essential elements of a contract are capacity, consent, a lawful object, and consideration].) Significantly, it is unclear from the face of the Settlement Agreement what California Ranch agreed to do or refrain from doing or that Island Pacific promised to do anything other than what it already agreed to under the Purchase Agreement. (See U.S. Ecology, Inc. v. State of California (2001) 92 Cal.App.4th 113, 128-29 [discussing element of consideration].) Thus, it is not obvious the Settlement Agreement is a valid contract supported by consideration.

Additionally, California Ranch does not address the terms of the Settlement Agreement and whether it performed or was excused from performing in accordance therewith. (See Wiz Technology, Inc., supra, 106 Cal.App.4th at pp. 12-13.) The fact of California Ranch’s performance or excuse for nonperformance is not obvious, particularly because it is unclear if and to what extent the parties’ performances under the Settlement Agreement relate to and/or depend on the parties’ performances under the Purchase Agreement. Furthermore, the Settlement Agreement does not resolve a pending lawsuit, it predates this litigation, and so the Court is not presented with the typical scenario in which dismissal of a lawsuit is conditioned on receipt of a payment and a release of the claims asserted. (See, e.g., Hurvitz v. St. Paul Fire & Marine Insurance Co. (2003) 109 Cal.App.4th 918, 923-24.) In summary, California Ranch does not demonstrate it performed or was excused from performing.

California Ranch skips straight to the element of breach. Its discussion of the element of breach is tantamount to no discussion at all because it is not supported by any legal analysis. (See Quantum Cooking Concepts, Inc. v. LV Associates, Inc. (2011) 197 Cal.App.4th 927, 934; see also People v. Dougherty (1982) 138 Cal.App.3d 278, 282.) For example, although the Settlement Agreement required Island Pacific to deposit in escrow $75,000 prior to closing on August 15, and Island Pacific tendered its payment a few days late, California Ranch does not discuss applicable contract law or the terms of the Settlement Agreement as necessary to demonstrate this constituted an actionable breach. Additionally, California Ranch does not demonstrate Island Pacific breached the Settlement Agreement because it does not establish the existence of a valid contract and its own performance or excuse for nonperformance in the first place. (See Pry Corp. of America v. Leach (1960) 177 Cal.App.2d 632, 639 [“He who seeks to enforce a contract must show that he has complied with the conditions and agreements of the contract on his part to be performed.”].)

California Ranch’s discussion of the element of damages also lacks clarity and support because it focuses on entitlement to prejudgment interest without first establishing the amount of damages to which it is entitled. A plaintiff moving for summary judgment must present evidence “showing both the fact and the amount of damages.” (Pajaro Valley, supra, 128 Cal.App.4th at p. 1106.) “As damages are an element of a breach of contract cause of action [citation], a plaintiff cannot obtain judgment on a breach of contract cause of action in an amount of damages to be determined later.” (Paramount Petroleum Corp. v. Super. Ct. (2014) 227 Cal.App.4th 226, 241-42.) In the FAC, California Ranch simply alleges it seeks “damages according to proof,” and now asserts it “has been damaged at least in the amount of $150,000.” (FAC at p. 3; Mem. of Pts. & Auth. at p. 4:27-28.) But at least $150,000 is not a specific amount of damages.

Even if California Ranch took the position that it is entitled to $150,000 only, it does not present evidence or legal analysis to support that amount of damages. The only evidence California Ranch presents in support is a conclusory statement by its counsel that it “suffered damages in the amount of $150,000.” (Do Decl., ¶ 7.) A declaration in support of a motion for summary judgment must contain “evidentiary facts, not legal conclusions or ‘ultimate’ facts.” (Hayman v. Block (1986) 176 Cal.App.3d 629, 638-39; accord Hope Internat. University v. Super. Ct. (2004) 119 Cal.App.4th 719, 739, fn. 9 [“[C]onclusions of fact are not binding on a summary judgment motion.”].) Thus, the statement by California Ranch’s counsel, which is not otherwise supported by facts in his declaration or other evidence, has no evidentiary value. It is not otherwise obvious what the factual or legal basis for such an amount of damages is. Consequently, California Ranch does not establish it is entitled to $150,000 or any other amount of damages.

For the reasons set forth above, California Ranch does not carry its initial burden. The motion for summary judgment is therefore DENIED.