Case Name: Michael Hanneken v. Leland Stanford Junior University, et al.

Case No.: 16CV300285

Motion of Defendants for Summary Judgment or, in the Alternative, Summary Adjudication

Factual and Procedural Background

According to the allegations of the operative first amended complaint (“FAC”), plaintiff Michael Hanneken (“Plaintiff”) is a military veteran and lifelong member of the United States Army Reserves. (FAC, ¶ 1.) In addition to being a veteran, Plaintiff is also an entrepreneur who created a successful professional services firm. (Id. at ¶ 2.) Despite his success as a businessman, Plaintiff decided to return to graduate school with the goals of enhancing his military and professional career. (Id. at ¶ 3.)

Plaintiff enrolled at defendant Leland Stanford Junior University (“Stanford”) in order to achieve those goals after having numerous conversations with Stanford personnel, including defendant William J. Perry (“Secretary Perry”). (FAC, ¶ 5.) Plaintiff enrolled under the belief Stanford would help his military career. (Ibid.) Prior to enrolling, Plaintiff asked staff and faculty at Stanford whether he would be able to receive constructive credit as a student at Stanford. (Ibid.) Constructive credit allows a service member to apply educational credit towards courses offered at the United States Army War College. (Id. at ¶ 15.) Staff and faculty responded that they believed he would be able to obtain constructive credit and Secretary Perry was solely in charge of recommending a student receive it. (Id. at ¶ 17.) Two months after classes began, Plaintiff obtained a meeting with Secretary Perry. (Id. at ¶ 5.) During the meeting, Secretary Perry promised to provide Plaintiff with a letter of recommendation supporting his request for constructive credit in exchange for Plaintiff enrolling in specific courses and performing security-based doctoral research not otherwise required. (Ibid.) Plaintiff subsequently enrolled in those courses and engaged in security-based doctoral research in reliance on Secretary Perry’s promise. (Id. at ¶ 6.) After several requests for the letter of recommendation, Plaintiff was told Secretary Perry would not provide one. (Id. at ¶ 7.) The FAC does not allege whether Plaintiff received constructive credit.

On September 21, 2016, Plaintiff filed a complaint against defendants Stanford and Secretary Perry (collectively, “Defendants”) asserting causes of action for:

(1) Breach of Contract
(2) Promissory Estoppel
(3) Negligent Misrepresentation

On December 19, 2016, Defendants filed a demurrer to Plaintiff’s complaint prompting Plaintiff to file a FAC on January 20, 2017.

On February 21, 2017, Defendants again filed a demurrer to Plaintiff’s FAC. On April 20, 2017, the court (Hon. Folan) overruled Defendants’ demurrer to the first and second causes of action but sustained Defendants’ demurrer to the third cause of action with leave to amend.

Plaintiff did not further amend his complaint and on May 9, 2017, Defendants filed their answer to Plaintiff’s FAC.

On May 31, 2018, Defendants filed the motion now before the court, a motion for summary judgment/ adjudication of Plaintiff’s FAC.

II. Request for judicial notice.

In support of their motion for summary judgment/ adjudication, Defendants request judicial notice of various court records from this action including, among others, the complaint and FAC. Evidence Code section 452, subdivision (d) states that the court may take judicial notice of “[r]ecords of any court of this state.” This section of the statute has been interpreted to mean that the trial court may take judicial notice of the existence of the court’s own records. Evidence Code section 452 and 453 permit the trial court to “take judicial notice of the existence of judicial opinions and court documents, along with the truth of the results reached—in the documents such as orders, statements of decision, and judgments—but [the court] cannot take judicial notice of the truth of hearsay statements in decisions or court files, including pleadings, affidavits, testimony, or statements of fact.” (People v. Woodell (1998) 17 Cal.4th 448, 455.)

Accordingly, the request for judicial notice in support of Defendants’ motion for summary judgment or, in the alternative, summary adjudication is GRANTED. The court takes judicial notice of the existence of the records, not necessarily the truth of any matters asserted therein.

III. Defendants’ motion for summary judgment/ adjudication is DENIED.

The two remaining claims asserted in Plaintiff’s FAC are breach of contract and promissory estoppel. Defendants move for summary judgment on the basis that both causes of action are barred by a two year statute of limitations.

The statute of limitations for breach of oral contract is two years. (Code Civ. Proc., §339(1)—“[a]n action upon a contract, obligation or liability not founded upon an instrument of writing.”) “The statute of limitations for promissory estoppel based on oral promises is two years.” (Newport Harbor Ventures, LLC v. Morris Cerullo World Evangelism (2016) 6 Cal.App.5th 1207, 1224 (Newport).)

“[A] cause of action for breach of contract ordinarily accrues at the time of breach regardless of whether any substantial damage is apparent or ascertainable.” (Menefee v. Ostawari (1991) 228 Cal.App.3d 239, 246.) “Ordinarily, a cause of action for breach of contract accrues on the failure of the promisor to do the thing contracted for at the time and in the manner contracted.” (Waxman v. Citizens Nat. Trust & Savings Bank of Los Angeles (1954) 123 Cal.App.2d 145, 149.) As explained by the court in Newport, “Promissory estoppel is an equitable claim that substitutes reliance on a promise as a substitute for bargained-for consideration.” (Newport, supra, 6 Cal.App.5th at p. 1224.) “Cases have characterized promissory estoppel claims as being basically the same as contract actions, but only missing the consideration element.” (US Ecology, Inc. v. State of California (2005) 129 Cal.App.4th 887, 903.) “[P]romissory estoppel claims are aimed solely at allowing recovery in equity where a contractual claim fails for a lack of consideration, and in all other respects the claim is akin to one for breach of contract.” (Id. at p. 904.) Thus, a promissory estoppel cause of action based on the same set of underlying facts as a breach of contract cause of action, as is the case here, will share the same accrual date.

In moving for summary judgment/ adjudication, Defendants proffer the following evidence: The FAC alleges that, during a November 21, 2013 meeting between Plaintiff and Secretary Perry, Secretary Perry agreed and promised to sign and send to the military a letter of recommendation. Plaintiff testified at deposition that the alleged agreement and promise Secretary Perry made during the November 21, 2013 meeting required Secretary Perry to sign the letter of recommendation and send it to the military “soon after it’s provided to him, meaning days – a week it may take at the most.” Plaintiff provided the letter of recommendation on February 18, 2014. Secretary Perry did not sign and send the letter or recommendation to the military by February 25, 2014, and has not done so to this day. Plaintiff filed this action on September 21, 2016.

In essence, Defendants contend the agreement or promise was for Secretary Perry to sign and send the letter of recommendation no later than one week after it was provided to him. Defendants contend the breach occurred on February 25, 2014 when Secretary Perry failed to sign and send the letter one week after being provided the letter. Since Plaintiff did not commence this action until September 21, 2016, more than two years after the February 25, 2014 date of breach, Defendants contend the statute of limitations has run and the Plaintiff’s claims are barred.

In opposition, Plaintiff proffers evidence which would create a triable issue of material fact with regard to whether the parties specified or agreed upon a one week time for performance. Initially, Plaintiff contends Defendants misstate his deposition testimony to make the factual assertion that the agreement/ promise “required” Secretary Perry to sign and send the letter of recommendation within one week. The relevant deposition testimony is as follows:

Q: When you met with Secretary Perry on November 21st –
A: Right.
Q: –you described to him the process by which you were hoping to ultimately receive constructive credit from the Army, right?
A: Ultimately, yes sir.
Q: Okay. And that process consisted of two parts: The first part was to submit in – shortly after you start working on the security based research –
A: Right.
Q: – and classes –
A: Right.
Q: – a request to be excused from being centrally selected, that he – would be accompanied by a letter of recommendation from Secretary Perry to that effect; is that right?
[Objection by counsel]
Q: Is that the first step?
[Objection by counsel]
A: Maybe I will try again to answer your question.
Q: Okay.
[Objection by counsel]
A: The letter had two purposes, as you’ve described. It provides notice and support of my future packet for constructive credit.
It also requests that I be waived from central selection because that was the time – that’s where I was at at that time.
We spoke about the need to do those – to have – to achieve those.
We spoke about the fact that I would take some security courses at the next semester, and that once into it in that semester, a letter such as this would be provided to him and that it would be returned to the Department of the Army soon after it’s provided to him, meaning days – a week it may take at the most.

(Emphasis added.)

The court agrees with Plaintiff that Defendants have misstated the deposition testimony. Plaintiff responded to counsel’s question asking Plaintiff to confirm his conversation with Secretary Perry “describ[ing] to [Secretary Perry] the process by which you [Plaintiff] were hoping to ultimately receive constructive credit from the Army.” Thus, Plaintiff merely expressed his hope that the letter of recommendation would be signed and sent by Secretary Perry within one week; Plaintiff was not testifying about what he and Secretary Perry actually agreed upon with regard to a time for performance. (See also ¶7 to the Declaration of Michael Hanneken in Support of Opposition, etc.—“…in response to a question I believed to be about how I hoped this process would occur, I testified… By making this statement, I did not intend to suggest that Perry had actually agreed to provide or send a letter within one week of my sending him a draft. I only intended to express what my hope was.”)

Plaintiff’s position is further buttressed by Secretary Perry’s deposition testimony:

Q: Was the timetable discussed at this meeting in terms of how quickly you would potentially put in a request for the military on Colonel Hanneken’s behalf?
A: No.
Q: Did you say you would take any action for Colonel Hanneken within one week –
A: No.
Q: – of any triggering event?
A: No.
Q: Did Colonel Hanneken express to you that time was of the essence in performing the request he had of you?
A: No.

(See Plaintiff’s Additional Material Facts, Fact No. 4.)

Secretary Perry’s deposition testimony conflicts with Defendant’s assertion that the parties agreed upon a time for performance. (See also Plaintiff’s Additional Material Facts, Fact No. 5.) Since the evidence is in dispute, a triable issue of material fact exists which would preclude summary judgment/ adjudication.

Accordingly, Defendants’ motion for summary judgment or, in the alternative, summary adjudication is DENIED.