Dousette v. Minidis CA2/1 ( 2015 )

Filed 1/30/15 Dousette v. Minidis CA2/1
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION ONE
MARY DOUSETTE et al., B247436
Plaintiffs and Appellants, (Los Angeles County
Super. Ct. No. BC257079)
v.
JAMES D. MINIDIS et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of Los Angeles County, Mel Red
Recana, Judge. Affirmed.
Craig A. Huber for Plaintiffs and Appellants.
Klein & Wilson and Gerald A. Klein for Defendants and Respondents.
______________________________________________
Plaintiffs, Mary Dousette (Mary) and Michael Marsh (Michael), appeal from a
judgment entered against them after the trial court granted summary judgment against
Michael on his breach of contract, fraud and conversion claims, and the jury returned a
verdict on Mary’s breach of contract, promissory fraud, concealment, and conversion
claims in favor of defendants, James D. Minidis (James) and Lynn Minidis (Lynn).1
Plaintiffs contend that the trial court erred in granting summary judgment against Michael
for lack of standing. Plaintiffs do not assert any ground for reversal of the judgment
against Mary independent of Michael’s assertion that the trial court erred in effectively
eliminating him from the trial.
We affirm the judgment because the trial court properly determined Michael
lacked standing. Even if, arguendo, the trial court erred, the error was harmless because
Michael was in privity with Mary and thus bound by the jury’s verdict in favor of
defendants, and because the evidence and jury instructions demonstrate that the jury had
ample information about Michael’s significant involvement in the transactions giving rise
to the instant case.
BACKGROUND
The complaint and first trial
Plaintiffs filed this action on August 28, 2001, against defendants as well as Café
Concepts, Inc. (Café Concepts), California Tortilla Fresh, Inc. (Tortilla Fresh), California
Pride Foods, Inc., and Rick Armstrong (Armstrong). 2 Mary and Michael are married and
James and Lynn are married. Armstrong provided tax services to James and Lynn and to
the corporate defendants.
The complaint alleged that in 1996, plaintiffs, defendants, and Armstrong began
negotiations to own and run a number of franchise stores based on a “concept-style” food
1We use first names to prevent confusion because some of the parties have the
same last name. By doing so, we mean no disrespect.
2 The trial proceeded against James and Lynn only because plaintiffs requested
defaults against the corporate defendants in November 2001 and a dismissal without
prejudice as to Armstrong in March 2004.
2
operation, which had been developed by James. The parties formed Tortilla Fresh in
1996 for this purpose pursuant to an agreement, which called for the opening of five
corporate locations. Pursuant to the 1996 agreement, Mary was required to obtain
financing and serve as vice-president and a director of the corporation. Mary and
Michael further alleged that they provided $150,000 of their own money, as well as funds
from other third parties through Mary’s efforts. Because of his expertise in operating
franchises, James was the corporation’s president and a director, and assumed primary
responsibility for overseeing franchise operations. Armstrong was the operations
manager.
In 1997, the parties entered into a second agreement, which “was intended to
super[s]ede” the prior agreement, and changed the corporation’s name to Café Concepts.
The 1997 agreement substituted Lynn as vice-president of the corporation in place of
Mary, and delineated ownership of the stock, giving 51 percent to James, 39 percent to
Mary, and 10 percent to Armstrong. The 1997 agreement required Mary to make an
additional cash infusion of $155,000 to the business venture. At all relevant times,
Armstrong served as the corporation’s chief financial officer and a director.
Plaintiffs alleged that they ultimately contributed over $320,000 to the business,
which James converted; James then refused to provide an accounting for the funds.
Plaintiffs initially sued for breach of contract, fraud, conspiracy, conversion, breach of
fiduciary duty, violation of shareholder’s rights, and an accounting, although as noted
below, they dismissed some of those claims later on.
The matter was initially tried by a jury, which rendered a verdict in plaintiffs’
favor and against James and Lynn in the amount of $6.2 million. The trial court
subsequently granted a new trial motion on grounds of irregularity in the proceedings and
surprise, which order this Division upheld in 2008. (Dousette v. Café Concepts, Inc.
(Nov. 19, 2008, B188118) [nonpub. opn.].)3
3 The irregularity at issue in the first trial was Michael’s and his counsel’s
secreting Armstrong away in a hotel so that defendants could not locate him to testify as
3
The summary judgment and second trial
On May 26, 2011, after the matter was remanded, defendants filed a motion for
summary judgment or alternatively summary adjudication against Michael on the ground
that he lacked standing to pursue claims for breach of contract, fraud, conversion, or an
accounting.4 In support of the motion, defendants cited the 1996 and 1997 agreements
governing the business venture, in which Michael was not designated a signatory, party,
or shareholder.
Defendants also produced evidence from Michael’s deposition and testimony at
the first jury trial that it was Mary, not Michael, who had provided all the funds used in
the business venture. In his deposition, Michael testified that all the documents were put
in Mary’s name because she “was putting the money in” and wanted the documents and
shares in her name instead of Michael’s name. At the first jury trial, Michael testified
that he was not a signatory to the agreements because his and Mary’s financial advisor
told them to put the documents in Mary’s name.
In their motion, defendants asserted that Michael could not establish a breach of
contract claim because he was not a party to the contracts. Michael could not establish
damages for fraud or conversion because Mary owned all the funds contributed to the
business venture. Michael was not entitled to an accounting because he was not a
stockholder.
Michael opposed the summary judgment motion on the ground that triable issues
of material fact existed as to whether his status as Mary’s husband and owner of a
community interest in the funds invested in the business gave him standing to pursue the
remaining claims. In addition, Michael contended that he negotiated and signed deal
part of their case-in-chief. We reversed based, in part, on evidence adduced posttrial that,
contrary to plaintiffs’ assertions at the first trial, defendants were not siphoning funds
from the corporation, and all of plaintiffs’ investment was put into the corporation.
4Defendants also asserted that the conspiracy claim lacked merit because
conspiracy is only a theory to impose liability against a joint tortfeasor and is not an
independent cause of action. Michael conceded that summary adjudication of this claim
was appropriate.
4
memos, which were part of the “series” of documents and agreements. Michael cited
James’s discovery response, which stated, “‘Actually [the] agreement was with Michael
Marsh,’” as evidence that Michael had standing to pursue the claims in the complaint.
Alternatively, there were triable issues of material fact as to whether Michael had
standing to enforce the agreements as a third party beneficiary. Michael also relied on
Patrick v. Alacer Corp. (2008) 167 Cal. App. 4th 995 (Patrick) to argue that his
community property interest in the funds Mary used to acquire the stock and invest in the
venture gave him standing to bring the contract and tort claims herein.
In reply, defendants noted that Michael had dismissed in 2004 all but his breach of
contract, fraud, conversion and accounting causes of action. Defendants argued Patrick
was distinguishable because of the special standing requirements for a shareholder
derivative claim, which in Patrick was brought by a wife after her spouse had died. (167
Cal.App.4th at pp. 1000–1001.) Defendants reiterated that Michael had not signed either
agreement and asserted the complete absence of evidence that would have supported his
status as a third party beneficiary of the agreements. At most, Michael was an incidental
beneficiary, which, under the applicable case law, was insufficient for standing to bring a
breach of contract claim. Defendants further contended that precontract discussions were
irrelevant to the issue of whether Michael was a party to the contracts.
The trial court granted the summary judgment motion against Michael on
October 3, 2011. As to the breach of contract cause of action, the trial court concluded
that the documents attached to the complaint demonstrated that only Mary was a “named
party to the contracts,” and thus Michael lacked standing to pursue the cause of action.
As to the fraud cause of action, the court held that the evidence “demonstrates that funds
invested in the project were provided by . . . Mary,” and that Michael’s claim of a
community property interest in those funds “would be addressed in a Family Law Court,
but have no bearing on this civil action.” Similarly, the trial court ruled that Michael
lacked standing to bring a conversion claim given that the funds invested in the project
were provided by Mary, and that Michael’s remedy regarding his claim of a community
5
property interest in those funds was in the family court. For all these reasons, the
accounting claim “fail[ed].”
On November 5, 2012, Mary proceeded to a jury trial on the breach of contract,
promissory fraud, concealment, and conversion causes of action; defendants prevailed on
all four claims. As to the breach of contract claim, the jury found that Mary and James
had entered into a contract and that Mary had done “the significant things” that the
contracts required, but that “all conditions for James[’s] performance” had not occurred.
As to the promissory fraud claim, the jury found that James had made promises to Mary
“that [were] important to the transaction,” but answered “no” to the question of whether
James “did not intend to perform” those promises. Similarly, as to the concealment
claim, the jury found that James did not “intend to deceive Mary . . . by intentionally
failing to disclose important” facts. The jury also found that James was not liable for
conversion of money “belonging to Mary.”
On January 3, 2013, the trial court entered judgment in favor of defendants and
against both plaintiffs. Michael and Mary filed a timely notice of appeal from the
judgment.
DISCUSSION
Summary judgment and appellate review standards
The trial court must grant summary judgment when the moving and opposition
papers demonstrate that there is no triable issue of material fact and the moving party is
entitled to judgment as a matter of law. (Code Civ. Proc., § 437c, subd. (c).) “[T]he
party moving for summary judgment bears the burden of persuasion that there is no
triable issue of material fact and that he is entitled to judgment as a matter of law. . . .
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.” (Aguilar v. Atlantic
Richfield Co. (2001) 25 Cal. 4th 826, 850 (Aguilar).)
A defendant moving for summary judgment has the initial burden of persuading
the court that there is no dispute as to a material fact regarding an element of the cause of
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action at issue, or there is a complete defense to that cause of action. (Code Civ. Proc.,
§ 437c, subd. (p)(2); Aguilar, supra, 25 Cal.4th at p. 850.) If the defendant makes the
initial showing, the burden shifts to the plaintiff to make a prima facie showing that a
triable issue of material fact exists. (Code Civ. Proc., § 437c, subd. (p)(2); Aguilar,
supra, at p. 850.) An appellate court reviews an order granting summary judgment
de novo. (Coral Construction, Inc. v. City and County of San Francisco (2010) 50
Cal. 4th 315, 336.)
The trial court correctly held that there were undisputed material facts evidencing
Michael’s lack of standing to assert the contract and tort claims herein
The contract claim
Defendants moved for summary adjudication of the contract claim on the ground
Michael lacked standing. 5 “Every action must be prosecuted in the name of the real party
in interest, except as otherwise provided by statute.” (Code Civ. Proc., § 367.)
“It is elementary that a party asserting a claim must have standing to do so. In
asserting a claim based upon a contract, this generally requires the party to be a signatory
to the contract, or to be an intended third party beneficiary.” (Berclain America Latina v.
Baan Co. (1999) 74 Cal. App. 4th 401, 405.)
It was undisputed that Michael was not a signatory or a party to the 1996 and 1997
agreements. The only signatories to those agreements were Mary (a shareholder and
officer of Café Concepts and Tortilla Fresh), James (an officer, majority shareholder, and
board member of Café Concepts and Tortilla Fresh), and Armstrong (chief financial
officer and a board member of Café Concepts). Simply put, the contracts, on their face,
5 Plaintiffs assert that defendants are estopped from arguing lack of standing
because defendants raised that issue for the first time after we ordered a new trial. At the
same time, they concede, as they must, that as a “jurisdictional defect,” “[l]ack of
standing can be raised at any time in the proceeding.” (Common Cause v. Board of
Supervisors (1989) 49 Cal. 3d 432.) Plaintiffs also concede that they failed to raise the
estoppel argument in opposing the summary judgment motion before us. We conclude
that plaintiffs’ failure to raise estoppel in the trial court constitutes a failure to preserve
that issue for appeal.
7
demonstrated that, Mary, not Michael, was a signatory/owner/shareholder/and officer of
the business venture. Indeed, Michael testified at his deposition that the decision to put
the contracts in her name was not an oversight, but instead a deliberate decision upon
advice of their financial advisor.
Lacking standing as a signatory to the agreements, Michael next contends that
there were disputed material facts as to whether he was a third party beneficiary of the
agreements. “A contract, made expressly for the benefit of a third person, may be
enforced by him at any time before the parties thereto rescind it.” (Civ. Code, § 1559.)
The only evidence to support his contention is that he negotiated the terms of the
agreements and signed some preliminary documents leading up to the 1996 and 1997
agreements. Nothing in the executed agreements suggests that the agreements were made
expressly for his benefit. At most, the evidence might demonstrate that Michael
incidentally benefited from the performance of the contracts executed by James, Mary,
and Armstrong only. An incidental benefit to a third party, however, is insufficient to
confer standing to that third party to pursue a breach of contract claim. (Spinks v. Equity
Residential Briarwood Apartments (2009) 171 Cal. App. 4th 1004, 1022.)
Nor does Michael’s assertion that he had a community property interest in funds
used to finance the business venture confer standing on him to sue for breach of contract.
The case law is clear that the mere fact that community assets may have been involved in
a contractual transaction does not give the nonsignatory spouse standing to sue on the
contract. For example, in Hatchwell v. Blue Shield of California (1988) 198 Cal. App. 3d
1027, the appellate court held that a wife’s community property interest in her husband’s
benefits under an insurance policy did not give the wife standing to sue either as a party
or a third party beneficiary for contract or tort damages arising out of the insurance
company’s failure to pay her husband’s medical benefits (as opposed to her own) —
notwithstanding that she reviewed and investigated the policy and made the decision to
purchase the policy as the family’s health insurance plan. “Someone who is not a party
to [a] contract has no standing to enforce the contract or to recover extra-contract
damages for wrongful withholding of benefits to the contracting party.” (Id. at p.1034.)
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Whatever Michael’s rights may have been concerning his community property
interests, there is no dispute that he was not a party to the agreements, nor did he produce
evidence demonstrating that he was a third party beneficiary of those agreements.
Indeed, all the evidence is to the contrary, Michael having testified that Mary and he
expressly chose not to make him a party. In sum, because Michael failed to produce
evidence demonstrating a triable issue of material fact regarding his lack of standing, the
trial court properly summarily adjudicated the breach of contract claim against him.
The fraud and conversion claims
Similarly, the stock and all corporate documents were placed in Mary’s name; the
money funding the corporation came out of Mary’s own professional checking account.
At his deposition, Michael conceded that the stock was issued solely in Mary’s name
because “she was putting the money in.” He testified: “Since Mary was putting the
money in, she wanted to make sure that it was in her name. So when there were share
certificates that were going to be issued, she wanted them in her name.” To oppose the
summary judgment, Michael produced evidence that he handled negotiations with James,
which prompted Mary to enter into the business venture. He also asserted that he had a
community property interest in the professional account from which Mary’s investment
in the corporation derived, and under Patrick, supra, 167 Cal. App. 4th 995, that
community property interest was sufficient ground on which to base standing to assert his
tort claims.
Patrick does not support Michael’s argument. It is true that in Patrick, in
reversing the trial court’s sustaining of a demurrer to a derivative claim for fraud, breach
of fiduciary duty, and constructive trust, among other claims, the appellate court held that
a wife’s allegation of a community interest in stock originally in her husband’s name later
put into a trust was sufficient to support standing. (167 Cal.App.4th at p. 1011.) The
factual context giving rise to that holding is inapposite to the facts before us.
There, wife and husband cofounded a highly successful vitamin supplement
company. Both were officers in the corporation and financially supported the corporation
during their marriage. Planning to divorce his wife, the husband put the shares in a trust,
9
which provided that 46 percent of the shares be distributed to the wife upon the
husband’s death to satisfy whatever community property interest she had in the
corporation and to prevent her from obtaining control of the company. The trust was the
only shareholder of record. When her husband’s death was imminent, the individual
defendants obtained her vote to become directors of the corporation upon promises that
they would serve only temporarily and take minimum compensation. Once the husband
died, among other alleged misdeeds, the individual defendants did not transfer the stock
to the wife and looted the corporation.
In finding that the wife had standing to bring a derivative claim on the
corporation’s behalf, the appellate court relied on the unique features of a derivative
claim: “The standing requirements for a derivative action reflect the limited adverse
relationship between the shareholder plaintiff and the corporation.” (Patrick, supra, 167
Cal.App.4th at p. 1004.) All the plaintiff needed to allege for a derivative claim was that
plaintiff “is a record or beneficial shareholder of the corporation.” (Ibid.) Taking all
allegations as true in ruling on a demurrer, the appellate court held that the wife’s
allegation that she was entitled to a fair share of the profits from a community endeavor
involving the couple’s joint efforts was sufficient to render her a beneficial shareholder
for purposes of a derivative claim. (Id. at p.1011 [relying on Corp. Code, section 800,
subd. (b)(1) providing that plaintiff in a derivative claim must allege that plaintiff “‘was a
shareholder, of record or beneficially . . . at the time of the [relevant] transaction’”].) In
contrast, the appellate court affirmed the trial court’s sustaining of the demurrer to the
wife’s direct fraud claim for lack of causation. (Patrick, supra, at pp. 1016–1017.)
In the case before us, both spouses are alive and there was no shareholder’s
derivative claim. There was no need for Michael to pursue any claims against defendants
concerning the failed venture because Mary, the owner of the stock, could, and did
pursue the claims against defendants in her own name. As noted above, Patrick
eliminated the wife’s direct claims notwithstanding any asserted community property
interest. We hold that Patrick is not controlling and that the trial court correctly granted
summary judgment of Michael’s claims for lack of standing.
10
Even if, arguendo, summary judgment was improvidently granted, the record and
jury instructions reveal that any such error was harmless
Citing Mueller v. J.C. Penney Co. (1985) 173 Cal. App. 3d 713 (Mueller), among
other cases, defendants contend that even if the trial court’s grant of summary judgment
against Michael were erroneous, that error was harmless because Michael and Mary were
in privity, and Michael would therefore be bound by the jury’s verdict adverse to Mary
under res judicata and related doctrines of preclusion. Michael counters that as a
consequence of the trial court’s ruling he was “essentially excised from the proceedings”
and that Mary was “forced . . . to present an entirely different case to the jury.”
In Mueller, the wife brought assault and battery claims against the defendant store,
and the husband a loss of consortium claim arising out of the wife’s alleged physical
contact with a security guard who suspected the wife of shoplifting. The defendant store
prevailed at trial. While the civil case was pending, the wife was convicted of
misdemeanor assault and battery. The appellate court held that collateral estoppel
precluded the wife from contesting that she had, in fact, shoplifted. (Mueller, supra, 173
Cal.App.3d at p. 719.)
Although the Mueller court concluded that the trial court had erroneously denied
the husband’s right to examine witnesses on his loss of consortium claim, that error was
harmless because he was in privity with his wife. “To prevail on his consortium action,
[husband] must show liability ([the defendant’s] tortious injury to [wife]) and damages.
Liability, an issue in this civil case, has necessarily been decided adversely to [wife].
Moreover, in any subsequent action for loss of consortium, [wife’s] action against [the
defendant] would be a final judgment on the merits. Thus, [husband] is barred by the
adverse determination against [wife] if he is in privity with [wife] in her action against
[the defendant]. [¶] . . . Privity refers to a relationship . . . ‘sufficiently close’ so as to
justify applying collateral estoppel. [Citation.] Under California law, spouses are in
privity with each other where the cause of action in the prior litigation was ‘community
in nature’ and the ‘proceeds of any judgment that might have been recovered . . . would
11
have belonged to both husband and wife, as community property.’ [Citations.]”
(Mueller, supra, 173 Cal.App.3d at p. 723.)
As set forth above, Michael’s theory is that he had a community property interest
in the funds Mary invested in the corporation. All of Michael’s claims derived from
theories about how funds supplied by Mary were misused by defendants. Michael and
Mary were thus in privity vis-a-vis claims that defendants misused those funds. A jury
determined that defendants were not liable to Mary on any of her claims. If the summary
judgment were reversed, Mueller and principles of res judicata and collateral estoppel
would not allow Michael to relitigate those claims.
Michael next contends that Mary’s trial was somehow infected by his no longer
being a party. He argues that Mary, who was not a party to the negotiations to form the
business venture, could not have supplied the evidence that was needed to prove breach
of contract, fraud, or conversion. That error was compounded because Michael, who was
no longer a party to proceedings, was relegated to being a mere witness at trial. In
addition, he claims that the jury may have been misled by the special verdict form, which
asked if James made promises to Mary or failed to disclose important facts to Mary,
whereas all James’s representations and communications were made to Michael.
According to Michael, “It was, quite simply, an entirely different case the jury was called
upon to consider than the one where [Michael] was a plaintiff.”
The record simply does not support this contention, which is speculative at best.
At trial, Michael testified extensively about his involvement in the formation of the
business venture and the roles that the various persons played. Michael stated that he was
looking for opportunities to invest in restaurants in the early 1990’s, and that Michael and
Mary had purchased an ownership interest in Fastrack Inc. also known as Bonjour Bagel
& Coffee (Bonjour Bagel) from a man named Steve Metz (Metz). Initially, Michael was
only an investor, but, although the investment started off well, in around 1996 problems
began to occur because of Metz’s mismanagement. Michael took over the management
after Metz was terminated. In June 1996, James agreed to help Michael out with some
issues that had arisen with Bonjour Bagel; James ultimately agreed to purchase Bonjour
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Bagel’s assets if he did not have to deal with claims being made against Bonjour Bagel
by some of its franchisees.
Michael was very impressed after visiting James’s Tortilla Fresh restaurant in the
Lancaster-Palmdale area. From 1995 to the early part of 1996, Michael negotiated with
James and Rick Armstrong to operate Tortilla Fresh franchises; he and Mary wanted to
be passive investors in the company. Michael and Mary began putting money into the
business in early 1996. In earlier negotiations, Michael was supposed to be on the board
of Tortilla Fresh. After talking to their financial advisor, Michael and Mary decided to
have Mary be the shareholder and not Michael. The couple used Mary’s money for the
investments. Michael testified further that Mary and he contributed $320,000 to the
business venture.
In 1996, James told Michael that there was a potential opportunity for Tortilla
Fresh to do a joint venture with Edwards Cinema. James knew the owner of Edwards
Cinema, who was interested in having Tortilla Fresh placed in all the theaters. Michael
also knew that James was operating ten Little Caesar restaurants. Relying on this
information, Michael and Mary gave James “more money.” At some point, the Edwards
Cinema deal fell through, but James told Michael that they could still rent from the retail
mall.
In early 1997, James shared his vision about Café Concepts with Michael. James
said that Tortilla Fresh was too limited in scope. James suggested that they expand the
concept to include a food mart with different kinds of food including breakfast, lunch,
and dinner with regular and children’s menus. James did not tell Michael that James had
closed the Lancaster Tortilla Fresh location.
Michael also testified that communications with James and Rick occurred through
him and not Mary. Toward the end of 1997, Michael was concerned about the lack of
progress. He and James had a meeting in early March 1998 to discuss where the money
was going. James told him the money was being spent on development costs, Bonjour
Bagel, Armstrong’s fees, legal expenses, and cabinets, among other expenses.
13
Michael also testified that he had several conversations with James about the
business venture over a couple of months. James corresponded with him or told him
about prospective store locations, including the potential to have locations in Edwards
Cinemas. As previously noted, James’s statements prompted Michael and Mary to give
James money. James corresponded with Michael about opening bank accounts and filing
papers to establish the corporation. Michael understood James’s statements to be
“promises” and that it was going be “a really exciting opportunity.”
Significantly, during trial Mary’s counsel stipulated that Michael was acting as
Mary’s agent during the negotiations. The jury was instructed with CACI No. 1906 as
follows: “MISREPRESENTATIONS MADE TO PERSONS OTHER THAN THE
PLAINTIFF [¶] James Mindis and/or Lynn Mindis is responsible for a representation that
was not made directly to Mary Dousette if he and/or she made the representation to a
group of persons including Mary Dousette or to another person, intending or reasonably
expecting that it would be repeated to Mary Dousette.” It does not appear from the
record that Mary’s counsel objected to the jury instructions, which he told the court
required “only very minor tweaks.” There was no objection to the special verdict forms.
Indeed, the record reflects that Mary’s counsel submitted the special verdict forms to the
trial court and announced his agreement to them.
Under these circumstances, the jury was amply informed of Michael’s leading role
in negotiating the agreements, the representations James made to Michael about the
progress of the corporation, and how the invested funds were being spent. Contrary to
Michael’s assertions, Michael was far from invisible at trial. The record is replete with
the very testimony he contends was “excised” by virtue of the grant of summary
judgment. Michael’s speculation that the jury could have been misled by the special
verdict form is just that. The jury was instructed under CACI No. 1906 that a
misrepresentation did not have to be made to Mary directly, but instead to others, if it
could be reasonably expected that the misrepresentation would be repeated to Mary.
Indeed, at oral argument, defendant’s counsel was given an opportunity to provide
citations to the record to support his contention that defendants argued at trial that there
14
were representations made to Michael that were not intended to be communicated to
Mary. In response, defendants’ counsel conceded that the record did not support the
latter argument and acknowledged that trial counsel had stipulated before the jury that
“‘Michael Marsh and Mary Dousette are agents of each other.’” He also enclosed an e-
mail from defendants’ trial counsel in which trial counsel represented that “[d]efendants
conceded at trial (as indicated by the instruction) that communications to Marsh were
deemed to be communications to Dousette. I never argued otherwise.”
In sum, the defense verdict on Mary’s claims would preclude Michael from
relitigating the claims Mary lost at trial, and any error in granting summary judgment
against Michael was harmless.
DISPOSITION
The judgment is affirmed. Defendants are awarded their costs on appeal.
NOT TO BE PUBLISHED.
BENDIX, J.*
We concur:
ROTHSCHILD, P. J.
JOHNSON, J.
* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
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