Filed 8/4/20 Soracco v. Bravo CA2/8

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 EIGHT

E. ROBERT SORACCO,

Plaintiff and Respondent,

v.

PATRICIA DEL CARMEN BRAVO,

Defendant and Appellant.

B291790

(Los Angeles County

Super. Ct. No. BC560739)

APPEAL from a judgment of the Superior Court of Los Angeles County, Gregory Keosian, Judge. Affirmed.

Law Offices of Malcolm R. Tator and Malcolm Tator for Defendant and Appellant.

E. Robert Soracco, in pro. per., for Plaintiff and Respondent.

_________________________

With noteworthy understatement, the trial court described this case as one which “arises from a complicated relationship between an uncle and niece, involves a bankruptcy, the acquisition of real property, the obtaining of a mortgage, various oral agreements, numerous refinances, and the eventual dispute as to who is the owner of the real property” located at 121 Hope Street, Unit 506, Los Angeles, California (the Hope property). Following a court trial, the court found plaintiff Robert Soracco to be the owner, not his niece, defendant Patricia Del Carmen Bravo.

Bravo appeals from the judgment entered after trial, raising just two interrelated issues. She contends her uncle lacked standing to prosecute this action and he should be judicially estopped from bringing this action. Both claims are based on filings Soracco submitted in his Chapter 7 bankruptcy proceeding which began on July 31, 1995. In the trial court, Bravo contended 1) Soracco had a pre-bankruptcy option agreement to purchase the Hope property; 2) the option was an executory contract within the meaning of bankruptcy law; and 3) Soracco was required to but did not list this contract in his bankruptcy filing. Bravo argued this omission meant that either 1) the right to bring this action belonged to the bankruptcy estate and so Soracco lacked standing to bring it; or 2) Soracco should be judicially estopped from bringing this action based on taking inconsistent positions in the two legal proceedings.

Bravo has now modified and expanded her claims, contending that Soracco’s “prepetition contract rights,” consisting of Soracco’s contract with the previous owners of the Hope property, and then his contract with her, were the property of the bankruptcy estate. She now also contends the Hope property is the property of the bankruptcy estate. We affirm the judgment.

BACKGROUND

In 1994, Soracco leased the Hope property from the Egans. The lease contained an option to purchase the property. The trial court summarized what followed: “Due to financial difficulties and the filing of a bankruptcy [in 1995], [Soracco] was unable to exercise the option to purchase the property and/or take title in his name. With the arrival of [Bravo] from Argentina, [Soracco] and [Bravo] entered into an oral agreement which for the most part is undisputed. The oral agreement called for [Bravo] to obtain a mortgage to purchase the property and obtain title in her name, while [Soracco] would be responsible for the payments. [Bravo] would transfer title to the property to [Soracco] once he was able to refinance the property, after the loan was paid off, or within 6–8 months, depending on the version believed.”

“This agreement continued until the year 2000, when the loan became due. As [Soracco] was still unable to qualify, [Bravo] obtained a new loan, again in her name.” Bravo contended she and Soracco renegotiated their oral agreement before she obtained the new loan, that is, Soracco agreed to give her a 50 percent ownership in the Hope property, increasing to 100 percent when Soracco died. Soracco denied they had renegotiated their agreement and the trial court found the parties’ behavior was not consistent with such an agreement.

“In 2013, [Soracco] made the final payment on the mortgage and demanded title to the property from [Bravo]. [Bravo] refused, relying upon the 2000 oral agreement. Further, unbeknownst to [Soracco], [Bravo] had taken out a line of credit on the property in approximately 2012.” Bravo was still making payments on the line of credit during this lawsuit.

In 2014, Soracco filed this action against Bravo, alleging causes of action for quiet title, declaration of resulting trust, fraud and conversion. He did not allege breach of contract. Bravo successfully demurred to the quiet title and conversion causes of action. A court trial followed in July 2017 on the constructive trust and fraud claims.

At the beginning of that trial, Bravo raised her standing and judicial estoppel claims, pointing out that if either defense applied, no trial need occur. The court indicated it could not decide these defenses without hearing evidence. Trial proceeded.

When the trial court issued its statement of decision on January 5, 2018, the court did not mention Bravo’s claims of standing or judicial estoppel. Bravo filed written objections to the statement, and pointed out that the trial court had not addressed the issues of judicial estoppel or standing. Bravo argued the evidence showed that Soracco’s option agreement in the lease, which expired by its own terms on May 31, 1995, was extended and modified by agreement of the parties. The modification was that Bravo’s name would be on the title. Bravo characterized the option agreement as an executory contract which became the property of the bankruptcy estate.

The trial court did not modify its tentative statement, ruling: “[A]fter review of the responsive documents received, the Tentative Statement of Decision is the Final Statement of Decision and Judgment.” Bravo filed a motion for new trial, which did not raise any issues relevant to this appeal. This appeal followed.

DISCUSSION

A. Statement of Decision
B.
Bravo’s initial claim on appeal is that the trial court’s statement of decision is inadequate because it does not contain any findings on standing or judicial estoppel. Although she contends the omission is reversible per se in light of her timely objections, she also contends this court can remedy the omission by making findings based on undisputed facts.

“The specific rules concerning the adequacy of a statement of decision are derived from the Code of Civil Procedure. Section 632 requires a statement of decision to explain ‘the factual and legal basis for [the] decision as to each of the principal controverted issues’ of the case.” (Central Valley General Hospital v. Smith (2008) 162 Cal.App.4th 501, 513.) Standing was a controverted issue in this case. Judicial estoppel was relatedly an issue.

“ ‘When a statement of decision does not resolve a controverted issue . . it shall not be inferred on appeal . . . that the trial court decided in favor of the prevailing party as to those facts or on that issue.’ ” (Central Valley General Hospital v. Smith, supra, 162 Cal.App.4th at p. 513.)

The trial court’s findings adequately address the standing issue and the related issue of judicial estoppel. The trial court expressly found Soracco “was unable to exercise the option to purchase the property.” The court further found Soracco acquired the property through his conduct after Bravo took title. Soracco made “all payments on the property, including mortgage, insurance, taxes, utilities, improvements, and all other costs associated with ownership.” The trial court found Soracco acquired ownership through a resulting trust.

These findings are a direct rejection of Bravo’s claim that Soracco lacked standing. Even assuming the unexercised option agreement was the property of the bankruptcy estate, Soracco would not lack standing to pursue his claim to title to the property. That claim to the property arose from his payments, over a 20-year period, of all costs associated with ownership, not from his unexercised option agreement with the Egans.

B. Soracco Has Standing.

On appeal, Bravo abandons her claim that the option agreement was an executory contract and makes much broader claims about Soracco’s lack of standing. “[It] is well settled that ‘ “[c]ontentions based on a lack of standing involve jurisdictional challenges and may be raised at any time in the proceeding.” ’ ” (City of Los Angeles v. Metropolitan Water Dist. of Southern California (2019) 42 Cal.App.5th 290, 310.) As a practical matter, like other parties who raise a new theory of standing on appeal, Bravo is limited to the evidence in the record to support her contentions.

Bravo claims: “ ‘All legal or equitable interests of the debtor in property as of the commencement of the case.’ Obviously, the debtor’s prepetition contract rights became [bankruptcy] estate property. (In re Ryerson (9th Cir. 1984) 739 F.2d 1423, 1425 [(Ryerson)]. Those would be his contracts with Ms. Bravo and his landlord, the Egans.”

The Bankruptcy Code is far more complicated and nuanced than Bravo’s bare statement suggests, as Ryerson itself shows. That case involves a debtor’s right to compensation under an employment contract in the event the contract was cancelled or terminated. The contract existed prepetition, the termination occurred postpetition and the Court declared that some but not all of the compensation belonged to the bankruptcy estate. (Ryerson, supra, 739 F.2d at pp. 1425–1426.)

The broad general statement of the court in Ryerson, upon which Bravo presumably relies, discusses legal rights of action arising from contracts. The Ryerson court stated: “Among the debtor’s legal interests that become a part of the bankruptcy estate under the [Bankruptcy] Code are his choses in action and claims against third parties as of the commencement of the case. S. Rep. No. 989, 95th Cong., 2d Sess. 82, reprinted in 1978 U.S. Code Cong. & Ad. News 5787, 5868. These choses in action and claims clearly include rights of action based upon contract.” (Ryerson, supra, 739 F.2d at p. 1425.) As we discuss below, on the record before us, neither of the two “contracts” would have been enforceable under California law. Bravo offers no legal authority or argument that an unenforceable contract can be the basis of a right of action under bankruptcy law, or that such a contract becomes part of the bankruptcy estate. “In order to demonstrate error, an appellant must supply the reviewing court with some cogent argument supported by legal analysis and citation to the record.” (City of Santa Maria v. Adam (2012) 211 Cal.App.4th 266, 286–287 (City of Santa Maria).) We may and do “disregard conclusory arguments that are not supported by pertinent legal authority or fail to disclose the reasoning by which the appellant reached the conclusions he wants us to adopt.” (Id. at p. 287; Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956 (Cahill) [claim not supported with reasoned argument and citations to legal authority deemed waived].)

1. Bravo’s Offer of Assistance to Soracco Was Not a Contract Which Soracco Was Required to Disclose in Bankruptcy Proceedings.

Bravo fails to explain how her offer to hold legal title to the Hope property for Soracco rose to the level of a contract, or how Soracco had a right of action based on that contract. She has thus forfeited her claim on appeal that Soracco had a prepetition right of action in that “contract” which he was required to list in his bankruptcy filing. (City of Santa Maria, supra, 211 Cal.App.4th at pp. 286–287; Cahill, supra, 194 Cal.App.4th at p. 956.)

Even assuming Bravo had not forfeited this claim, the record shows at least two omissions preventing the formation of a contract. The contract was uncertain and indefinite in at least one material particular: the length of time Bravo would hold the title. This was disputed at trial, and the court tried but was unable to make a definite finding on that particular fact. (See Ladas v. California State Auto. Assn. (1993) 19 Cal.App.4th 761, 770 [whether agreement is too vague and indefinite to be a contract is a question of law].)

Bravo’s prospective performance, which appears to have been to put her name on the title and hold it for some period of time, is unlimited under her version of the agreement. A contract for personal services cannot be specifically enforced (Civ. Code, § 3390, subd. (a)), nor is specific performance available when the duty to be performed is a continuous one, extending possibly over a long period of time. (Long Beach Drug Co. v. United Drug Co. (1939) 13 Cal.2d 158, 171.)

Further, consideration must be adequate for specific performance (Civ. Code, § 3391, subd. (1)) and we see no compensation at all here. There is nothing in the record to suggest Soracco agreed to provide any consideration to Bravo for her services. (Civ. Code, § 1550.)

2. The Option Extension Was Not Enforceable.

Bravo’s claim on appeal that Soracco had a prepetition right in the option agreement suffers from the same flaw as did her argument in the trial court that the option agreement was an executory contract: Soracco’s claim to the Hope property was not based on that “contract.”

A further defect in Bravo’s appellate argument is that she failed to offer evidence during trial that Soracco had an enforceable contractual right under the option extension, assuming there was such an extension. The original option agreement, which was in writing, expired on May 31, 1995, well before Soracco’s July 31, 1995 bankruptcy filing. Although there is some evidence in the record that the agreement was extended, there is nothing to show that this extension was in writing. Under California law, an option to purchase real property comes within the statute of frauds and so must be in writing. (Pacific Southwest Development Corp. v. Western Pac. R. Co. (1956) 47 Cal.2d 62, 66.) An agreement that modifies a contract subject to the statute of frauds is likewise subject to the statute of frauds. (Granadino v. Wells Fargo Bank, N.A. (2015) 236 Cal.App.4th 411, 416; Civ. Code, § 1698, subd. (c).)

There are exceptions to the statute of frauds, although Bravo does not argue any exception applies. Thus, any claim of an exception is waived or forfeited. (City of Santa Maria, supra, 211 Cal.App.4th at pp. 286–287; Cahill, supra, 194 Cal.App.4th at p. 956.)

Notwithstanding the forfeiture of this issue, we note Bravo argues Soracco purchased the Hope property pursuant to the option agreement, which might support a performance-based exception to the statute. As she acknowledges, however, Soracco testified to the contrary and the trial court found the purchase was not a result of an exercise of the option. We also note that, as part of this argument, Bravo points to Exhibits 91 and 130, contending these documents, apparently email printouts, show Soracco and the Egans agreed Soracco purchased the Hope property pursuant to the option agreement. These exhibits might constitute a writing; however, they were apparently created during the pendency of this action and were not admitted into evidence. The index of the reporter’s transcript for the court trial does not show any exhibit marked as number 91 and admitted into evidence. Similarly, the index does not show that Exhibit 130 was admitted into evidence. The court’s rulings at the end of Soracco’s case and again at the end of Bravo’s case do not confirm Exhibit 130 (or the non-existent Exhibit 91) was admitted into evidence. Bravo has not provided us with any citations to the record showing when the documents were admitted into evidence. An appellant must “[s]upport any reference to a matter in the record by a citation to the volume and page number of the record where the matter appears.” (Cal. Rules of Court, rule 8.204(a)(1)(C).) We are not required to search the record on our own. When a party fails to support an argument with the necessary citations to the record, the argument is deemed to have been waived. (United Grand Corp. v. Malibu Hillbillies, LLC (2019) 36 Cal.App.5th 142, 156.)

3. The Bankruptcy Estate Does Not Encompass The Hope Property.

Bravo claims “the estate did not end there,” presumably meaning that the estate did not end simply with Soracco’s supposed contract rights. She contends the estate also includes “ ‘the proceeds, product [and] offspring . . . of or from property of the estate’ ” pursuant to section 541(a)(6) of Title 11 of the United States Code and “ ‘any interest in property that the estate acquires after the commencement of the case’ ” pursuant to section 541(a)(7) of Title 11 of the United States Code. We clarify, as Bravo has not, that section 541(a)(7)’s reference to property acquired by the estate applies to property which was “created with or by property of the estate.” (In re Neidorf (Bankr. 9th Cir. 2015) 534 B.R. 369, 372.)

Bravo argues it is undisputed that Soracco acquired his interest in the Hope property “thru his pre-bankruptcy contract with Ms. Bravo [and] as a product or offspring of that contract.” This is only “undisputed” because Bravo did not make this claim before filing her opening brief on appeal and so there has been no opportunity for anyone to dispute it. As we have just explained, Bravo has forfeited her claim that her offer of assistance to Soracco rose to the level of a valid contract, and the record shows a lack of consideration and a fatally vague term for her services. Accordingly, she has not shown that her “offer of assistance” was the property of the bankruptcy estate.

C. Judicial Estoppel Does Not Apply.

Bravo’s judicial estoppel claim is predicated on her belief that Soracco deliberately concealed the option extension and her offer of assistance from the bankruptcy court and then in this case took the inconsistent position that both were valid agreements.

Judicial estoppel applies when: “(1) the same party has taken two positions; (2) the positions were taken in judicial or quasi-judicial administrative proceedings; (3) the party was successful in asserting the first position (i.e., the tribunal adopted the position or accepted it as true); (4) the two positions are totally inconsistent; and (5) the first position was not taken as a result of ignorance . . . or mistake.” (Jackson v. County of Los Angeles (1997) 60 Cal.App.4th 171, 183.) More specifically, California courts have used the doctrine of judicial estoppel “where a debtor in bankruptcy violates its statutory and fiduciary duty to disclose a current claim during a bankruptcy proceeding . . . as a bar to further litigation by the debtor.” (International Engine Parts, Inc. v. Feddersen & Co. (1998) 64 Cal.App.4th 345, 350.)

Soracco did not have a duty to disclose his option extension or Bravo’s offer of assistance. The trial court found Soracco did not believe he could exercise the option agreement to purchase the Hope property. Moreover, any oral extension of the original expired option agreement, as we have explained, was not valid. In his complaint here, Soracco did not claim he had a right to the property as the result of his option agreement with the Egans. The pleadings in this case show Soracco sought to enforce a constructive trust arising from his own conduct over the years, not any contractual rights. This is consistent with Soracco’s implicit position in bankruptcy proceedings: he did not view the option as an enforceable contract that should be listed as an asset. Nor did he view Bravo’s offer of assistance as part of an enforceable contract. Soracco has taken no inconsistent positions in the 20 years since this dispute arose. Judicial estoppel does not apply.

DISPOSITION

The judgment is affirmed. Costs are awarded to respondent E. Robert Soracco.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

STRATTON, J.

We concur:

GRIMES, Acting P. J.

WILEY, J.