Filed 6/11/20 Spevakov v. China Unicom etc. CA6

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

SIXTH APPELLATE DISTRICT

LIANG SPEVAKOV,

Plaintiff and Appellant,

v.

CHINA UNICOM (AMERICAS) OPERATIONS LIMITED et al.,

Defendants and Respondents.

H046118

(Santa Clara County

Super. Ct. No. CV299573 )

Plaintiff Liang Spevakov challenges a judgment of dismissal after the court granted summary judgment to defendants China Unicom (Americas) Operations Limited (hereafter CU-Americas) and China Unicom (Hong Hong) Operations Limited (hereafter CU-Hong Kong). Plaintiff contends that triable issues of fact precluded summary judgment. We conclude that the trial court did not err in granting summary judgment, and we affirm.

I. Factual and Procedural Background

In 2009, plaintiff, an experienced salesperson specializing in the telecommunications industry, accepted a job with CU-Americas as an account manager. CU-Americas provided plaintiff with an offer letter outlining the terms of her employment. The offer letter stated that plaintiff was being offered “employment with China Unicom (Americas) Operations Limited (‘the Company’) on the terms and conditions stated below.” Plaintiff’s compensation included a monthly base salary and the ability to earn commissions on sales. Plaintiff’s ability to earn commissions was governed by a commission plan. Specifically, the offer letter stated: “You are entitled to participate in the Company’s commission plan, which is subject to change from time to time at the Company’s discretion. Please consult with your supervisor or HR department for details.”

In March 2015, CU-Americas issued an updated commission plan entitled, “China Unicom Americas Sales Commission Policy V2.0.” This four-page document was drafted by CU-Americas and issued only to CU-Americas’ employees. It included a section on “Scope and application,” which stated: (1) “This policy shall be used as a general guideline in the administration of the commission scheme for commission based sales persons,” and (2) “The specific commission scheme for each individual sales person shall, in principle, be designed within the scope of the terms set forth in this policy.” Under “Definitions,” “Commission Base” was “defined as the monthly service fees and charges booked and payment received by the company.” Further, “Commission Base exclude[d]: [¶] 1) Any non-recurring fees or charges, 2) Any cost which include[s] but not limited to, taxes and payments to third parties, and settlement costs to China Unicom Group and its affiliates[,] 3) Any SLA or other forms of credit back to the customer.”

According to the 2015 commission plan, salespeople would receive tiered percentages of their “Commission Base” for new contracts or new orders. The tiered percentages were: “First year 30%, second year 20%, third year 15%, 4th year 10%, 5th year 5%, and no commission shall be paid for the contract period thereafter.” Under “General Guidelines Applied to All Products,” the 2015 commission plan elaborated that “revenue will be eligible for commission only if the aging of the [accounts receivable] is less than 6 months,” and that “the commission rate will drop to 50% of the original rate if the aging of the [accounts receivable] is more than 6 months when payment is received by China Unicom Americas.” The “General Guidelines” also provided that when a salesperson’s employment with “China Unicom Americas is terminated voluntarily or involuntary” that employee “will be paid at the end of employment if the [minimum sales turnover of $10,000] is met at the end of employment . . . .” Elsewhere, the 2015 commission plan defined “Minimum Sales Turnover” “as the net contribution to China Unicom Americas Monthly Recurring Charge,” and specified that “[i]n order to receive commission payments, an individual sales person must attain a [minimum sales turnover] level of USD $10,000 during the current calendar year.” If that requirement was not satisfied, “no commission will be distributed.”

Under the heading, “Effective date,” the 2015 commission plan stated: “1. CUA Sales Commission Policy V2.0 shall be approval [sic] by management and become effective upon announcement. [¶] 2. Any contracts signed and orders fully executed after the announcement of this CUA Sales Commission Policy V2.0 will follow this policy. [¶] 3. Any previous cases in which commissions have been calculated by the previous version of the CUA Sales Commission Policy will continue to comply with the previous Sales Commissions Policy until end of 2015. All of those previous cases will be converted to be in compliance with this CUA Sales Commission Policy V2.0 starting on January 1st, 2016. [¶] 4. China Unicom Americas reserves all rights to revise this policy without any further notice.”

In August 2015, Apple, Inc. and CU-Americas entered into a Network Services Agreement (NSA). According to plaintiff, this deal was “the payoff to years of effort . . . to cultivate Apple’s business in the U.S.” The NSA provided the “ ‘general terms, conditions and framework within which Apple may from time to time purchase certain telecommunications and related infrastructure services . . . from Supplier as described in statement of work (also referred to as “Service Orders”).’ ” The NSA also provided that the requested services may be procured in “various countries where the parties wish to transact business by executing an Affiliate Agreement” substantially in the form attached to the NSA. The NSA further provided that the Affiliate Agreement “will incorporate by reference this Agreement,” “[e]ach Affiliate Agreement shall be deemed a separate contract between the parties who sign it,” and “[t]he Affiliate of Apple who signs an Affiliate Agreement shall be solely responsible for its obligations under such Affiliate Agreement, including, without limitation, its obligation to make payments for goods and services provided under such Affiliate Agreement.”

In September, Apple Asia Limited and CU-Hong Kong executed a separate “Affiliate Agreement for Hong Kong.” The two-page document incorporated by reference the NSA signed between Apple, Inc. and CU-Americas, and provided that CU-Hong Kong was the supplier of the requested services identified in the NSA. Although the rationale and details of the request are disputed, the parties agree that it was Apple’s decision to have the services identified in the NSA provided by CU-Hong Kong.

In February 2016, China Unicom Global Limited (CU-Global) implemented a “2016 Sales Incentive Scheme (Data Business)” replacing previous data sales incentive schemes in all overseas subsidiaries. Plaintiff was ultimately compensated for the Apple deal under the 2016 commission plan.

A. Complaint

In September 2016, plaintiff filed the instant action against defendants. In January 2018, she filed an amended complaint for damages, alleging: (1) breach of contract; (2) breach of the implied covenant of good faith and fair dealing; (3) promissory estoppel; (4) nonpayment of wages, in violation of Labor Code sections 204, et seq.; (5) unjust enrichment; and (6) declaratory relief.

The gravamen of plaintiff’s complaint was this: she contended that she should have been paid commissions under the 2015 commission plan, not the 2016 commission plan. The terms of the 2016 commission plan, according to plaintiff, “were far less generous to salespeople than the 2015 Plan.” Plaintiff pointed to the definition of the “Commission Base” in the 2015 commission plan, which was “defined as ‘the monthly service fees and charges booked and payment received by the company.’ ” From that commission base, plaintiff alleged that she should have received commissions of 30 percent for the first year of the contract, 20 percent for the second year, 15 percent for the third year, 10 percent for the fourth year, and 5 percent for the fifth year.

B. Summary Judgment Motion

Defendants moved for summary judgment. They argued, in relevant part, that plaintiff’s claims failed because she was not entitled to commissions under the terms of the 2015 commission plan. Plaintiff was not entitled to commissions, defendants contended, because payment for the Apple deal was remitted to CU-Hong Kong, and not CU-Americas. Under the terms of the 2015 commission plan, commissions could be earned only when “payment” was “received by the company”, i.e., CU-Americas. Although the term “company” was undefined, defendants argued that “[e]very indication” in the 2015 commission plan reflected that “the company” was “the entity issuing and administering the plan—CU Americas,” and that “nothing suggest[ed] payments received by other entities qualif[ied] for commissions.”

In support, defendants noted that the 2015 commission plan repeatedly referenced CU-Americas: (1) the definition of “ ‘Minimum Sales Turnover’ ” was “defined as ‘the net contribution to China Unicom Americas Monthly Recurring Charge,’ ” (2) the plan limits commissions when the accounts receivable was older than six months, “with the relevant time period being ‘when payment [was] received by China Unicom Americas,’ ” (3) “under the heading ‘Effective Date,’ ” “[a]ll four paragraphs . . . specifically reference CU-Americas,” and (4) the plan was “titled ‘China Unicom Americas Sales Commission Policy V.2.0’ and under the terms of the plan ‘China Unicom Americas reserve[d] all rights to revise this policy without any further notice.’ ”

Defendants also argued that the 2015 commission plan should be “interpreted together” with plaintiff’s offer letter, “as they are between the same parties and make up one transaction.” In that regard, defendants noted that plaintiff’s offer letter defined “ ‘Company’ as CU-Americas and provide[d] that Plaintiff [was] ‘entitled to participate in the Company’s commission plan.’ ”

C. Summary Judgment Opposition

Plaintiff filed opposition to the summary judgment motion. She argued that there were only two ways of understanding the 2015 commission plan: (1) either the terms of the 2015 commission plan were ambiguous, or (2) it “clearly preclude[d] Plaintiff from receiving commissions from payments made to other entities, in which case it [was] unlawfully unconscionable.”

If the 2015 commission plan was deemed ambiguous, plaintiff asserted that extrinsic evidence established that plaintiff should receive commissions “from payments made to any China Unicom entity.” Plaintiff asserted that she “reasonably believed the term ‘company’ referred to China Unicom as a whole . . . .” She noted that a salesperson would expect to be paid commissions on a sale regardless of which corporate entity was ultimately paid, and that an arrangement that “depend[ed] on the whims of China Unicom and its customers” was irrational.

Plaintiff also identified extrinsic evidence, which she argued supported her reading of the 2015 commission plan. She noted that the CU-Americas’ employee handbook “said that Plaintiff was an employee of ‘China Unicom’ and repeatedly referenced ‘the company’ without defining the term.” She also noted that CU-Americas’ Web site referenced “ ‘China Unicom’ under the headings, ‘Our Company,’ ” and that her “managers frequently used the term ‘China Unicom’ or ‘the company’ in reference to China Unicom’s overall business.” Finally, she argued that her 2009 offer letter was signed six years before the 2015 commission plan was enacted and thus there “was no reason she should have thought the definitions in her employment contract would apply to the 2015 commission plan . . . .”

Plaintiff further argued that if the 2015 commission plan was unambiguous, then the plan was procedurally and substantively unconscionable. She asserted that the contract was one of adhesion and that she was surprised that the contract was interpreted to deny her commissions in this case. She also asserted that the denial of commissions “shocks the conscience,” because it was a “vague contract term, written by the party in the stronger negotiating position, causing an employee to forfeit seven-figure commissions from a deal she cultivated over years simply because the customer wanted to pay a different subsidiary” as part of the deal.

Finally, plaintiff alleged, for the first time, that “[e]ven if, arguendo, Plaintiff is not entitled to commissions from Apple under the ‘company payment’ provision discussed [in the operative amended complaint], she is still owed [commissions] under the provision requiring that salespeople be paid commissions when other China Unicom entities take all revenues from deals they secure.” She alleged that the provision “entitled salespeople to commissions [of 1 percent] whenever there was a ‘revenue settlement rate with China Unicom Group of 100% . . . .’ ” Although the term “revenue settlement rate” was undefined in the 2015 commission plan, plaintiff alleged that her “managers told her that this provision would apply whenever China Unicom entities took all revenues from its sister companies’ sales . . . .”

D. Defendants’ Reply

Defendants rejected plaintiff’s arguments regarding extrinsic evidence. Defendants asserted that plaintiff’s subjective belief was immaterial to the interpretation of the 2015 commission plan. Defendants also noted that the employee handbook clearly identified it “as the handbook of ‘China Unicom Americas (Operations) Ltd.,’ ” and that the “receipt and acknowledgment at the end of the Handbook” stated the same.

Defendants also contended that plaintiff’s opposition attempted to expand the scope of the pleadings. Specifically, defendants noted that plaintiff had never before alleged in her pleadings that she was entitled to commissions under the 2015 commission plan’s “ ‘100-Percent Settlement Provision,’ ” and argued that “[t]he court should disregard this last ditch effort to defeat [the summary judgment] motion.”

E. The Trial Court’s Ruling

The trial court issued an order granting the motion for summary judgment. The trial court found that plaintiff had failed to raise triable issues regarding her causes of action for breach of contract, breach of the implied covenant of good faith and fair dealing, promissory estoppel, unpaid wages under the Labor Code, unjust enrichment, and declaratory relief.

II. Discussion

“Appellate review of a ruling on a summary judgment or summary adjudication motion is de novo.” (Brassinga v. City of Mountain View (1998) 66 Cal.App.4th 195, 210.) “In performing our independent review of a defendant’s summary judgment motion ‘we identify the issues framed by the pleadings since it is these allegations to which the motion must respond . . . .’ ” (Jones v. Wachovia Bank (2014) 230 Cal.App.4th 935, 945.) “[T]he party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that [the party] is entitled to judgment as a matter of law.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.) The moving party “bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact.” (Ibid.) “There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof.” (Ibid.)

 

A. Breach of Contract

1. The Contract is Not Ambiguous

Plaintiff recognizes that “[t]his dispute largely centers on a single word in the 2015 Plan, ‘company’, and whether it can reasonably be interpreted to include China Unicom as a whole and/or its subsidiaries.” Plaintiff argues that the 2015 commission plan was ambiguous, and that extrinsic evidence confirms that “the company” means China Unicom as a whole.

Under statutory rules of contract interpretation, the mutual intention of the parties at the time the contract is formed governs interpretation. (Civ. Code, § 1636.) “When a contract is reduced to writing, the intention of the parties is to be ascertained from the writing alone, if possible.” (Civ. Code, § 1639.) “The language of a contract is to govern its interpretation, if the language is clear and explicit, and does not involve an absurdity.” (Civ. Code, § 1638.) “The whole of a contract is to be taken together, so as to give effect to every part, if reasonably practicable, each clause helping to interpret the other.” (Civ. Code, § 1641.)

Here, the 2015 commission plan is clear that the “Commission Base” is comprised of the “monthly service fees and charges booked and payment received by the company.” Commissions are thus contingent on the receipt of payment by “the company.” While the term “the company” is nominally undefined in the 2015 commission plan, the whole of the contract makes unambiguously clear that “the company” can only mean CU-Americas. For instance, entitlement to commissions requires meeting a “Minimum Sales Turnover,” defined as “the net contribution to China Unicom Americas Monthly Recurring Charge.” The plan also limits commissions if the “aging of the [accounts receivable]” is over six months, with the relevant period of time defined as “when payment is received by China Unicom Americas.” Under the “Effective date” heading, the 2015 commission plan references CU-Americas four different times, including by noting that “China Unicom Americas reserves all rights to revise this policy without any further notices.” Finally, the 2015 commission plan specifies that when a salesperson’s employment with “China Unicom Americas is terminated,” that employee will be paid commissions if the “Minimum Sales Turnover” guideline is met.

On appeal, plaintiff argues that the intent of the 2015 commission plan is ambiguous in light of certain extrinsic evidence. “ ‘The court generally may not consider extrinsic evidence . . . to vary or contradict the clear and unambiguous terms of a written, integrated contract. [Citations.] Extrinsic evidence is admissible, however, to interpret an agreement when a material term is ambiguous. [Citations.]’ [Citations.]” (Brown v. Goldstein (2019) 34 Cal.App.5th 418, 432.) If extrinsic evidence reveals that apparently clear language in the contract is, in fact, susceptible to more than one reasonable interpretation, then extrinsic evidence may be used to determine the contracting parties’ objective intent. (Pacific Gas & E. Co. v. G.W. Thomas Drayage etc. Co. (1968) 69 Cal.2d 33, 39-40.)

The language in the 2015 commission plan is not ambiguous, and plaintiff’s extrinsic evidence does not reveal that it is susceptible to more than one reasonable interpretation. Plaintiff points to her own understanding that “the company” referred not to CU-Americas but rather to China Unicom generally. She also asserts that “common sense” supports her interpretation of the 2015 commission plan: that she was “a career salesperson and would naturally have expected to make commissions from any paying deal she secured,” and that it “would have been reasonable” to believe she would receive a commission under the circumstances of the Apple deal. None of this, however, is relevant to determining the mutual intent of the parties. “ ‘[I]t is the objective intent, as evidenced by the words of the contract, rather than the subjective intent of one of the parties, that controls interpretation’ [Citation]. The parties’ undisclosed intent or understanding is irrelevant to contract interpretation. [Citations.]” (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 956.) This is especially so, as is the case here, because “there is no evidence that [the other party] had the same understanding.” (PV Little Italy, LLC v. MetroWork Condominium Assn. (2012) 210 Cal.App.4th 132, 157.) In short, plaintiff’s subjective understanding of the 2015 commission plan is irrelevant.

Plaintiff also points to the CU-Americas’ employee handbook, which she asserts “said that [plaintiff] was an employee of ‘China Unicom’ and repeatedly referenced ‘the company’ without specifically defining the term, and/or narrowing it only to CU-[Americas].” Plaintiff, however, ignores the cover page of the employee handbook, which clearly identifies it as the handbook of “China Unicom Americas (Operations) Ltd.” Likewise, at the end of the handbook is a receipt and acknowledgment, stating: “This is to acknowledge that I have received a copy of the China Unicom (Americas) Operations, Ltd. Employee Handbook and I understand that it contains information about the employment policies and practices of the company.” Read as a whole, the employee handbook does not support plaintiff’s interpretation of the 2015 commission plan, nor does it show that the contract is susceptible to more than one reasonable interpretation.

2. The Challenged Provision is Not Unconscionable

Plaintiff argues that the provision in the 2015 commission plan limiting her ability to earn commissions to only when payment is received by CU-Americas is unconscionable. She contends the trial court erred in concluding that the provision was not unconscionable.

Unconscionability has both a procedural and a substantive element. The procedural element focuses “on ‘ “oppression” ’ or ‘ “surprise” ’ due to unequal bargaining power,” and the substantive element “on ‘ “overly harsh” ’ or ‘ “one-sided” ’ results.” (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 114.) Both elements must be present, but they need not be present in the same degree. “[T]he more substantively oppressive the contract term, the less evidence of procedural unconscionability is required to come to the conclusion that the term is unenforceable, and vice versa.” (Ibid.) “[U]nconscionability is determined as of the time the contract was entered into, not in light of subsequent events.” (Morris v. Redwood Empire Bancorp (2005) 128 Cal.App.4th 1305, 1324.)

“ ‘[T]here are degrees of procedural unconscionability. At one end of the spectrum are contracts that have been freely negotiated by roughly equal parties, in which there is no procedural unconscionability. . . . Contracts of adhesion that involve surprise or other sharp practices lie on the other end of the spectrum. [Citation.] Ordinary contracts of adhesion, although they are indispensable facts of modern life that are generally enforced [citation], contain a degree of procedural unconscionability even without any notable surprises, and “bear within them the clear danger of oppression and overreaching.” ’ ” (Baltazar v. Forever 21, Inc. (2016) 62 Cal.4th 1237, 1244.)

Here, the procedural unconscionability of the provision in the 2015 commission plan was minimal. Although plaintiff alleged that the 2015 commission plan was presented without the opportunity for negotiation, plaintiff also claimed that she was an experienced salesperson in the telecommunications industry with almost 20 years of experience. (Dotson v. Amgen, Inc. (2010) 181 Cal.App.4th 975, 981-982 [minimal procedural unconscionability when employee “is not an uneducated, low-wage employee without the ability to understand” the contract].) Plaintiff also alleged that she was “surprised” by how the provision operated. However, the provision in question was not hidden in the 2015 commission plan. Rather, it appeared on the first page of the plan (which itself is only four pages long), under the heading, “Definitions—Commission Base.” (Cf. Higgins v. Superior Court (2006) 140 Cal.App.4th 1238, 1252-1253 [procedural unconscionability high where challenged provision was buried in 24-page, single-spaced document].) This is not a case “where a decidedly stronger party employed ‘ “sharp practices” ’ and ‘ “surprise[d]” ’ the weaker party, resulting in significant procedural unconscionability.” (Farrar v. Direct Commerce, Inc. (2017) 9 Cal.App.5th 1257, 1266.) Nevertheless, because it was apparently presented to CU-Americas’ employees with no opportunity to negotiate it or reject it, the 2015 commission plan was a contract of adhesion giving rise to a minimal degree of procedural unconscionability. (Id. at p. 1267.)

“Substantive unconscionability examines the fairness of a contract’s terms. This analysis ‘ensures that contracts, particularly contracts of adhesion, do not impose terms that have been variously described as “ ‘ “overly harsh” ’ ” [citation], “ ‘unduly oppressive’ ” [citation], “ ‘so one-sided as to “shock the conscience” ’ ” [citation], or “unfairly one-sided” [citation]. All of these formulations point to the central idea that the unconscionability doctrine is concerned not with “a simple old-fashioned bad bargain” [citation], but with terms that are “unreasonably favorable to the more powerful party.” ’ ” (OTO, L.L.C. v. Kho (2019) 8 Cal.5th 111, 129-130.) “ ‘The substantive component of unconscionability looks to whether the contract allocates the risks of the bargain in an objectively unreasonable or unexpected manner.’ ” (Magno v. The College Network, Inc. (2016) 1 Cal.App.5th 277, 288.) “[T]he key factor is lack of mutuality. And the determinative question is whether the contract terms are so harsh or one-sided that they lack basic fairness.” (Abramson v. Juniper Networks (2004) 115 Cal.App.4th 638, 658.) “Substantive unconscionability ‘ “turns not only on a ‘one sided’ result, but also on an absence of ‘justification’ for it.” ’ ” (Carboni v. Arrospide (1991) 2 Cal.App.4th 76, 84.)

Here, it was not overly harsh for CU-Americas (at the time the plan was issued in 2015) to condition the payment of sales commissions to its employees on CU-Americas’ actual receipt of payments from customers. Under such terms, both CU-Americas and plaintiff assumed the risk that the customer would not pay, would pay late, or would elect to procure goods or services from an affiliated CU-entity. The terms of such an arrangement were not unreasonably favorable to CU-Americas because under such circumstances CU-Americas would also not receive payment. While the contract terms may seem unreasonable or unfair to plaintiff, it does not shock the conscience, especially in light of the fact that plaintiff did receive commissions under the 2016 commission plan, issued by CU-Global. This is not a case where plaintiff’s sales work was uncompensated. In sum, while there was minimal procedural unconscionability in the issuance of the provision in the 2015 commission plan, the terms of the challenged provision were not substantively unconscionable.

Under the unambiguous terms of the 2015 commission plan, plaintiff was not entitled to commissions for the Apple deal and thus there was no breach of contract. Nor were the terms unconscionable. Accordingly, the trial court did not err in summarily adjudicating this cause of action.

3. “100 percent settlement provision” Claim is Outside the Scope of Pleadings

Plaintiff contends that the trial court either did not consider her argument that she was owed commissions under the “100 percent settlement provision” in the 2015 commission plan, or erroneously concluded that this provision applied only where there was receipt of payment by CU-Americas. With respect to this claim, defendants argue that plaintiff improperly attempted to expand the scope of the operative amended complaint by arguing an additional breach of contract that was not alleged in her amended complaint.

It is well established that “the pleadings set the boundaries of the issues to be resolved at summary judgment.” (Oakland Raiders v. National Football League (2005) 131 Cal.App.4th 621, 648.) Accordingly, “[a] ‘plaintiff cannot bring up new, unpleaded issues in his or her opposing papers. [Citation.]’ [Citations.] A summary judgment or summary adjudication motion that is otherwise sufficient ‘cannot be successfully resisted by counterdeclarations which create immaterial factual conflicts outside the scope of the pleadings; counterdeclarations are no substitute for amended pleadings.’ [Citation.]” (Ibid.) “[T]he burden of a defendant moving for summary judgment only requires that he or she negate plaintiff’s theories of liability as alleged in the complaint; that is, a moving party need not refute liability on some theoretical possibility not included in the pleadings.” (Hutton v. Fidelity National Title Co. (2013) 213 Cal.App.4th 486, 493.) “ ‘If the opposing party’s evidence would show some factual assertion, legal theory, defense or claim not yet pleaded, that party should seek leave to amend the pleadings before the hearing on the summary judgment motion.’ ” (Johnson v. The Raytheon Co., Inc. (2019) 33 Cal.App.5th 617, 636.)

This does not mean that a party is precluded from alleging any additional facts or issues in opposition to a motion for summary judgment. A party opposing summary judgment is permitted to allege additional facts or issues when those allegations are encompassed by the operative complaint. In general, “new factual issues presented in opposition to a motion for summary judgment should be considered if the controlling pleading, construed broadly, encompasses them. In making this determination, courts look to whether the new factual issues present different theories of recovery or rest on a fundamentally different factual basis.” (Laabs v. City of Victorville (2008) 163 Cal.App.4th 1242, 1257 (Laabs).)

Plaintiff contends that her pleadings “gave fair notice of her right to seek commissions under the 100-Percent Settlement Provision.” She notes that she attached a full copy of the 2015 commission plan to her complaint, and that she pleaded the elements of a breach of contract cause of action. She contends that by doing so, defendants had “fair warning” that plaintiff was “seeking commissions pursuant to any and all terms in the [2015] Plan that would entitle her to them.”

In Laabs, the plaintiff alleged in her operative amended complaint a cause of action for premises liability based on the theory that her injuries were caused by a dangerous condition of public property, namely, inadequate sight distance at an intersection, which caused another driver not to see the vehicle in which the plaintiff was a passenger. The plaintiff alleged that the city was negligent in designing, constructing, and controlling the road conditions, and by failing to install warning signs or devices. (Laabs, supra, 163 Cal.App.4th at pp. 1249-1250.) The defendant moved for summary judgment. (Id. at p. 1250.) In opposing summary judgment, the plaintiff argued that the placement of a light pole constituted a dangerous condition that contributed to the severity of her injuries. (Ibid.) The trial court granted the motion for summary judgment. (Ibid.)

On appeal, the defendant argued that because the plaintiff made no allegations in her operative complaint that the physical location of the light pole was a basis for dangerous condition liability, the appellate court could not consider the issue in determining whether summary judgment was properly granted. (Laabs, supra, 163 Cal.App.4th at p. 1252.) The plaintiff argued that the placement of the light pole, while not specifically referenced in her complaint, was “ ‘closely tied to the [defendant’s] dangerous condition liability which was clearly alleged in [the] plaintiff’s complaint.’ ” (Ibid.) The appellate court rejected the plaintiff’s argument, noting that the operative pleading did not make any reference to the light pole, let alone allege that the plaintiff’s vehicle had struck a light pole. The additional facts “shift[ed] the alleged dangerous condition to a portion of public property not remotely referenced in the amended complaint. It attempt[ed] to predicate liability on a totally different condition, not the least bit involved with the intersection or inadequate sight distance.” (Id. at p. 1258.)

Here, as in Laabs, plaintiff’s allegation that she was owed commissions under the “100 percent settlement provision” was outside the scope of the pleadings. In the operative complaint, plaintiff specifically alleged that she was entitled to compensation based on tiered percentages (calculated over the course of five years) of the “Commission Base,” defined as “the monthly fees and charges booked and payment received by the company.” Plaintiff’s allegations in this regard were detailed and specific. Plaintiff’s new theory of recovery was premised on an entirely new set of factual allegations that were not alleged in the amended complaint. Similar to Laabs, the additional factual assertions shifted plaintiff’s breach of contract cause of action to a portion of the 2015 commission plan not remotely referenced in the amended complaint.

Plaintiff contends that by simply pleading breach of contract and attaching the 2015 commission plan, defendants were on notice that plaintiff could seek commissions “under any [applicable] part of the [2015 commission plan] . . . .” This contention runs contrary to the rules governing summary judgment. “To allow an issue that has not been pled to be raised in opposition to a motion for summary judgment in the absence of an amended pleading, allows nothing more than a moving target. For Code of Civil Procedure section 437c to have procedural viability, the parties must be acting on a known or set stage.” (Laabs, supra, 163 Cal.App.4th 1242, 1258, fn. 7.)

Plaintiff’s new theory of liability, raised entirely in her opposition to summary judgment, was not encompassed by the allegations in the operative amended complaint. Thus, the additional allegations regarding the “100 percent settlement clause” did not create a triable issue of fact with regard to the breach of contract cause of action.

B. Implied Covenant of Good Faith and Fair Dealing

Plaintiff contends that her claim that defendants breached the implied covenant of good faith and fair dealing was not duplicative of the contract claim. Plaintiff argues that a breach of the implied covenant of good faith and fair dealing does not require a breach of a contract’s express terms, and under the circumstances of this case, defendants’ actions violated that covenant.

There are no triable issues of fact with regard to this cause of action. The implied covenant “is designed to effectuate the intentions and reasonable expectations of parties reflected by mutual promises within the contract.” (Slivinsky v. Watkins–Johnson Co. (1990) 221 Cal.App.3d 799, 806.) For this reason, it is well established that an implied covenant cannot create an obligation inconsistent with an express term of the agreement. (Exxon Corp. v. Superior Court (1997) 51 Cal.App.4th 1672, 1688; Slivinsky v. Watkins–Johnson Co., at pp. 806-807.) We have already concluded that the express terms of the 2015 commission plan barred plaintiff from earning commissions when payment was not received by her employer, CU-Americas. Because the express terms of the agreement thus permitted CU-Americas to deny plaintiff commissions under the 2015 commission plan, doing so did not violate the implied covenant. Finally, plaintiff had no contractual relationship with CU-Hong Kong, and it was not a party to the 2015 commission plan. Thus, CU-Hong Kong’s actions could not have violated the implied covenant of good faith and fair dealing.

C. Unjust Enrichment

Plaintiff contends that while this “cause of action was nominally for ‘unjust enrichment,’ it was in essence a quantum meruit claim for restitution.” She asserts that CU-Hong Kong was unjustly enriched, as it “took advantage of Apple’s whim to inherit a plum piece of business for which [plaintiff] should have received commissions.” Thus, she argues that “[i]t is an unjust situation that begs for [plaintiff] to receive restitution in the amount of the commissions she otherwise would have been paid had the deal not been transferred to CU-[Hong Kong].”

“ ‘We begin with the law of restitution. An individual is required to make restitution if he or she is unjustly enriched at the expense of another. [Citations.] A person is enriched if the person receives a benefit at another’s expense. [Citation.] Benefit means any type of advantage. [Citations.] [¶] The fact that one person benefits another is not, by itself, sufficient to require restitution. The person receiving the benefit is required to make restitution only if the circumstances are such that, as between the two individuals, it is unjust for the person to retain it. [Citation.]’ ” (American Master Lease LLC v. Idanta Partners, Ltd. (2014) 225 Cal.App.4th 1451, 1481-1482.)

Here, there was no dispute that it was Apple’s decision to have Apple Asia contract with CU-Hong Kong. There was no suggestion that defendants did anything to cause this to happen, let alone with the knowledge or intent to deprive plaintiff of her commissions under the 2015 commission plan. Rather, CU-Hong Kong and CU-Americas accepted Apple’s demand that the services be billed to CU-Hong Kong. Further, plaintiff had no contractual relationship with CU-Hong Kong, she was not an employee of CU-Hong Kong, and CU-Hong Kong was not a party to the 2015 commission plan. Under the circumstances, it was not unjust for CU-Hong Kong to decline to pay plaintiff commissions under the 2015 commission plan.

III. Disposition

The judgment is affirmed.

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Mihara, J.

WE CONCUR:

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Premo, Acting P. J.

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Bamattre-Manoukian, J.

Spevakov v. China Unicom (America) Operations Limited et al.

H046118