Costa v. Sirimanne CA2/1 ( 2013 )

Filed 12/12/13 Costa v. Sirimanne 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NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION ONE
EDUARDO COSTA, B237130
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BC436209)
v.
BENEDICT SIRIMANNE et al.,
Defendants and Appellants.
APPEALS from a judgment and orders of the Superior Court of Los Angeles
County. J. Stephen Czuleger, Judge. Affirmed in part and reversed in part with
directions.
Robert Hindin & Associates and Robert M. Hindin for Plaintiff and Appellant.
Benedict Sirimanne, in pro. per.; Law Offices of Joseph P. Wohrle and Joseph P.
Wohrle for Defendants and Appellants.
______________
Eduardo Costa appeals from a judgment entered after a court trial, contending that
the trial court abused its discretion in denying Costa’s motion to amend his complaint to
add Sol Dominicana Airlines (Sol) as a plaintiff. Benedict Sirimanne and CSDS Aircraft
Sales & Leasing, Inc. (CSDS), also appeal, contending that insufficient evidence supports
the judgment in favor of Costa and against Sirimanne as individuals in Costa’s breach of
contract action and that the trial court erred in denying their motion for attorney fees.1
We conclude that the court erred in denying Costa’s motion to amend to add Sol as a
plaintiff to the complaint because Sirimanne and CSDS fail to articulate any facts or legal
theories that would have been changed by the proposed amendment and Sirimanne and
CSDS would not have been prejudiced by the proposed amendment. We also conclude
that sufficient evidence supports the judgment in favor of Costa and against Sirimanne as
individuals. We reverse with directions to the trial court to issue an order allowing Costa
to amend the complaint to add Sol as a plaintiff. Because we are reversing the trial
court’s order denying Costa’s motion to amend the complaint with respect to the causes
of action regarding the Lease/Purchase Agreement and therefore the prevailing party will
be determined on retrial, we affirm the trial court’s order denying Sirimanne and CSDS’s
motion for attorney fees. We affirm the judgment in favor of Costa on his cause of action
for breach of contract.
1 Citing California Rules of Court, rule 8.104, Costa argues that Sirimanne and
CSDS’s November 28, 2011 notice of appeal with respect to the trial court’s order
denying Sirimanne and CSDS’s motion for attorney fees was untimely because it was
filed more than 60 days after Sirimanne and CSDS “gave Notice of the Ruling” on
September 15, 2011 of the trial court’s order denying attorney fees. We disagree because
a notice of ruling does not start the 60-day appeal period; rather, a notice of entry of the
order or a file stamped copy of the order is necessary. (See Cal. Rules of Court, rule
8.104(a)(1)(A), (B); Bi-Coastal Payroll Services, Inc. v. California Ins. Guarantee Assn.
(2009) 174 Cal. App. 4th 579, 583–589; Sunset Millennium Associates, LLC v. Le Songe,
LLC (2006) 138 Cal. App. 4th 256, 259–260; 20th Century Ins. Co. v. Superior Court
(1994) 28 Cal. App. 4th 666, 670–672.)
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BACKGROUND
A. The complaint
On July 28, 2009, “EDUARDO COSTA, d/b/a SOL DOMINICANA AIRLINES,”
filed a complaint against Sirimanne and CSDS, alleging causes of action for fraud, breach
of contract, quantum meruit, and “restraining order” (complaint). The complaint alleged
as follows. On April 30, 2007, “Costa d/b/a SOL” entered into an agreement to lease two
aircraft with an option to purchase from CSDS (Lease/Purchase Agreement). CSDS
represented to Costa that it owned the two aircraft. “Costa, d/b/a SOL” intended to use
the aircraft to transport passengers to and from the Caribbean. Two aircraft were
required to conduct such an operation in the event one of the aircraft malfunctioned.
Costa made a down payment and monthly payments to CSDS for the two aircraft.
The first aircraft was delivered to Costa in June 2007. In November 2007, Costa
discovered that the second aircraft was not owned by CSDS but was owned by Air
Wisconsin, Inc. The second aircraft was never delivered to Costa even though Sirimanne
and CSDS assured Costa that CSDS would be able to deliver the second aircraft because
CSDS “had a particular agreement with Air Wisconsin.” Costa was unable to use the
first aircraft to transport passengers to and from the Caribbean because he did not have
two aircraft.
In order to help Costa recoup Costa’s losses from the failed Caribbean venture, on
January 24, 2008, Sirimanne and CSDS agreed with Costa that Costa could sublease the
two aircraft to an airline called Regional Paraguaya. “Costa, d/b/a SOL, pursuant to the
sublease,” delivered and subleased the first aircraft to Regional Paraguaya. Sirimanne
and CSDS failed to deliver the second aircraft to Costa. Subsequently, Sirimanne and
CSDS made false representations to Costa regarding plans to lease or sell the two aircraft
to other carriers. Costa would not have entered into the Lease/Purchase Agreement or
agreed to help sublease or sell the first aircraft if Costa had known the falsity of
Sirimanne and CSDS’s representations.
In November 2008, Costa agreed with Sirimanne and CSDS that if Sirimanne and
CSDS sold the first aircraft with Costa’s assistance, Costa would receive $400,000; Costa
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would receive a $50,000 bonus if the sales price exceeded $1.3 million. After Costa
placed a lien on the first aircraft, Sirimanne and CSDS “threatened Costa with violence if
he [did] not remove the lien.” Sirimanne and CSDS never intended to pay Costa
commissions on the subsequent lease or sale of the first aircraft.
On January 24, 2008, Costa agreed with Sirimanne and CSDS that if Costa met
with the chief executive officer (CEO) of Lloyd Aereo Boliviano (Lloyd) and
successfully “effectuate[d] the transfer of title and possession of” a Boeing aircraft from
Lloyd to CSDS, “and thus complete[d] CSDS’ ‘sale’ [of the Boeing aircraft] to Lorena
Air, CSDS would compensate Costa $300,000 for his commission and costs” (Boeing
Agreement). Costa met with the CEO of Lloyd and later discovered that CSDS had sold
the Boeing aircraft to Lorena Air. Sirimanne and CSDS did not pay the commission to
Costa owed under the Boeing Agreement.
B. The cross-complaint
On January 7, 2010, Sirimanne and CSDS filed a joint answer denying the
allegations of the complaint and asserting affirmative defenses. On that same day, CSDS
filed a cross-complaint against “EDUARDO COSTA d/b/a/ SOL DOMINICANA
AIRLINES” (cross-complaint). The cross-complaint alleged causes of action for breach
of written contract against “SOL”; breach of oral contract against Costa; fraud against
“SOL”; negligent misrepresentation against “SOL”; interference with prospective
economic advantage against “SOL”; and “money paid” against “SOL.”
The cross-complaint alleged as follows. Costa was a citizen of Brazil and Sol was
a company organized and existing under the laws of the Dominican Republic, with its
principal place of business in Santo Domingo, Dominican Republic. “Costa, on behalf of
SOL,” entered into negotiations regarding the lease and purchase of the two aircraft. On
February 21, 2007, “CSDS and SOL executed [a letter of intent] for SOL to lease with an
option to purchase two Aircraft from CSDS.” On April 30, 2007, “CSDS and SOL
executed a formal Lease Purchase Agreement regarding the Aircraft.” At the time of
delivery of the first aircraft on April 30, 2007, “SOL” had not fulfilled certain conditions
required under the Lease/Purchase Agreement, including paying the balance of the
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deposit. “SOL” defaulted on its lease payments in April 2008; flew the first aircraft to
Brazil and then to Paraguay without obtaining a required airline operator certificate; and
failed to perform regular maintenance on the first aircraft as required. In order to avoid
having a lien placed on the first aircraft, CSDS paid a third party for parts and services
for the first aircraft upon the failure of “SOL” to make payments to the third party.
CSDS entered into an oral agreement with Costa to sell the first aircraft, but Costa failed
to prepare the first aircraft for sale. Because “SOL” had not obtained proper
documentation and a “maintenance performer,” and had not established a maintenance
program by May 1, 2007, “SOL” requested CSDS to maintain possession of the second
aircraft until “SOL” was ready to take delivery. In reliance on “SOL’s” representations
that it was in the process of obtaining proper documentation, CSDS did not sell the
second aircraft to a potential buyer. Sirimanne and CSDS prayed for damages incurred,
“[a]s a result of SOL’s” actions, for $2 million for breach of contract; $2.7 million for
fraud; $2.7 million for negligent misrepresentation; $2.7 million for interference with
prospective economic advantage; and $300,000 for “money paid.”
C. Sirimanne and CSDS’s counsel’s motion to be relieved as counsel
On March 1, 2011, Sirimanne and CSDS’s counsel filed a motion to be relieved as
counsel, declaring as follows. Sirimanne and CSDS had not responded to counsel’s
attempts to contact them by telephone and e-mail for the last several months.
Consequently, counsel was “not in a position to respond to” eight sets of written
discovery propounded by Costa that were due on March 24, 2011. Further, Sirimanne
and CSDS failed to pay their attorney fees and costs.
Sirimanne and CSDS did not oppose the motion to withdraw and did not attend the
April 1, 2011 hearing at which the motion was granted. Subsequently, Sirimanne and
CSDS retained new counsel. The trial court continued the trial to June 20, 2011.
Sirimanne and CSDS dismissed their cross-complaint on June 21, 2011. At some point
before trial, jury was waived.
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D. The trial
On June 21, 2011, Sirimanne and CSDS filed a trial brief, describing a “major”
legal issue as: “COSTA’s right to bring claims for breach of contract and fraud against
CSDS regarding a contract in which (a) SOL was a corporation, and (b) SOL (and NOT
COSTA) was a party to the contract.”
Trial commenced on June 22, 2011. After Costa’s opening statement, Sirimanne
and CSDS made an oral motion for nonsuit, arguing, “There was no reference to the
business dealings of Sol, which is as set forth in the complaint, dba Sol Dominicana
Airlines.” The trial court denied the motion stating, “Of course, he did say in his opening
statement that he was going to do business at the Dominican Republic operating as Sol
Dominicana.”
At trial, Costa testified that Sirimanne asked him to arrange a meeting between
Sirimanne and the CEO of Lloyd in order to facilitate the sale of a Boeing aircraft; in
return, Costa and two other persons involved in the arrangement were to receive
$100,000 each. Costa testified that Sirimanne told him, “[H]e [Sirimanne] would pay
$300,000, [$]100,000 for each of us to help him in this meeting.” (Italics added.) A
letter of agreement dated January 24, 2008 (Letter of Agreement) was entered into
evidence. The Letter of Agreement stated that Costa and another person would “receive
a commission” to compensate them for scheduling “a first meeting with” the CEO of
Lloyd in order to “complete the transaction for CSDS.” The Letter of Agreement
displayed a signature line with Sirimanne as president of CSDS. An e-mail dated
March 26, 2008 (March e-mail), setting forth the terms of the Boeing Agreement was
also introduced into evidence. The March e-mail displayed a signature line with
Sirimanne as president of CSDS. The March e-mail stated, “I [Sirimanne] will pay a
total of US $300,000 for all three people, the following way. [¶] . . . [¶] I will pay US
$100,000 as soon as the aircraft departs Brazil. [¶] . . . [¶] Please understand I cannot
do better than this since I have to spend over $4.5 Million on this aircraft and my return is
coming over 48 months. I am financing this deal with no title to the aircraft which is
very difficult.” (Italics added.) Costa testified that “also on the agreement when the
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plane would leave Brazil, he [Sirimanne] would pay the $300,000,” and “[t]his document,
it’s where he [Sirimanne] agrees that he’s going to pay $300,000 to me, to Paulo and to
Sturno as soon as the plane would leave Brazil.” (Italics added.) Costa performed his
part of the Boeing Agreement, but Sirimanne did not pay him $100,000.
Sirimanne testified that his digital signature was on the Letter of Agreement, “but I
did not put it there. I did not sign this agreement.” Sirimanne testified that he had asked
Costa to connect him with Lloyd and that the Letter of Agreement accurately reflected his
agreement to pay a commission to Costa for introducing him to Lloyd. Sirimanne further
testified that the March e-mail from him to Costa confirmed his agreement that he would
pay $300,000 to Costa and two other people.
Sirimanne and CSDS’s counsel argued that “[t]he contract for the commissions
was an oral contract. This e-mail is proof of the terms of the oral contract.” Sirimanne
and CSDS’s counsel argued that the March e-mail confirmed that Sirimanne was acting
as president of CSDS when he entered into the Boeing Agreement with Costa. The trial
court stated, “Yeah, that’s what it says at the bottom. A lot of people use paperwork that
has the name of the company on it. We don’t have testimony from Mr. Sirimanne on that
issue though, do we? [¶] The answer is no, we don’t.” Sirimanne and CSDS’s counsel
stated, “None that I am aware of at this time.”
Later, the trial court asked Costa’s counsel, “[T]he exception of the agreement to
pay the [$]300,000 to three people, aren’t all of the allegations directed against CSDS and
not Mr. Sirimanne . . . [¶] . . . [¶] . . . in his personal capacity?” Costa’s counsel
responded, “The request for the commissions for $300,000, we’re claiming that Mr.
Sirimanne is part of that.”
After Costa rested his case on June 23, 2011, CSDS and Sirimanne stated that they
might move for a “non-suit” or a “directed verdict.” The trial court then stated that it had
a “question about the standing in this case,” and ordered the parties to brief whether
Costa could bring a lawsuit in his “personal capacity . . . on behalf of a . . . now defunct
corporation.” The next morning, on June 24, 2011, Costa made a motion to amend the
complaint to add Sol as a plaintiff. The court denied the motion stating, “And had there
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been, I assume, a demurrer filed, that would have focused the issue. I was, obviously, not
the calendar judge. I don’t know how the case was pretried. . . . [Sirimanne and CSDS]
can simply choose to defend based on the complaint as filed and the evidence as
introduced at trial.” The court concluded that Sirimanne and CSDS were prejudiced by
their lack of ability to conduct discovery as to Costa’s “corporate authority, which . . .
Costa has or does not have, as well as the defense that . . . Costa is not the proper party.”
The trial recommenced and concluded that day.
According to Sirimanne and CSDS’s July 27, 2011 motion for attorney fees, on
June 24, 2011, the trial court rendered a tentative decision that Costa recover nothing on
his claim against Sirimanne and CSDS for breach of the Lease/Purchase Agreement.
That tentative decision is not included in the record on appeal. Sirimanne and CSDS’s
motion requested attorney fees incurred in defending against Costa’s breach of contract
action based on the Lease/Purchase Agreement. The trial court denied the motion on
August 19, 2011.
On August 29, 2011, the trial court rendered a statement of decision as follows.
Costa had no standing to sue Sirimanne and CSDS for the first and second causes of
action for fraud. No representations were made by Sirimanne and CSDS to Costa in
Costa’s personal capacity and no reason was shown to disregard the corporate entity and
allow Costa to sue in his own name. Costa had no standing to sue Sirimanne and CSDS
for the third cause of action for breach of contract. Costa, as president of Sol, signed a
letter of intent for the lease and purchase of the two aircraft and the Lease/Purchase
Agreement. No representations were made by Sirimanne and CSDS to Costa in Costa’s
personal capacity; fraudulent misrepresentations, if any, were made to Sol, which is not a
party to the action. Costa did not suffer damages as a result of any representations made
by Sirimanne and CSDS.
Costa, as an individual, agreed with Sirimanne and CSDS that Costa and two other
individuals, who were not parties to the action, would receive $100,000 each if Costa
performed introductions for the sale of the Boeing aircraft. Sirimanne, in his personal
and corporate capacity, promised to pay Costa and the two other individuals $100,000
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each. Costa, and not Sol, was a party to the Boeing Agreement; Costa performed what
was required of him under the Boeing Agreement; and Costa established that Sirimanne
and CSDS breached the Boeing Agreement by failing to pay $100,000 to Costa. Costa
entered into the Boeing Agreement in his personal capacity, and although it was unclear
whether Sirimanne entered into the Boeing Agreement in his personal capacity or as a
representative of CSDS, “[t]hat lack of clarity does not rebound against . . . Costa.” The
trial court declined to exercise equity jurisdiction on the quantum meruit cause of action.
Costa’s motion to amend the complaint at trial was denied because Sirimanne and CSDS
“had no opportunity to conduct discovery concerning a new party, i.e., the corporate
entity Sol . . . and thereby would be prejudiced by the late amendment of the complaint to
add a new party. [Sirimanne and CSDS] were entitled to defend the action based upon
the state of the pleadings during the trial in mounting their defense and choosing to waive
jury.”
Judgment was entered on August 29, 2011, in favor of Costa for $100,000 and
against Sirimanne and CSDS, jointly and severally. Notice of entry of judgment was
served on September 12, 2011. Costa filed a notice of appeal on November 4, 2011.
Sirimanne and CSDS filed a notice of appeal on November 28, 2011.
DISCUSSION
A. The trial court erred in denying Costa’s motion to amend the complaint to add
Sol as a plaintiff
Costa contends that the trial court abused its discretion in denying Costa’s motion
to amend the complaint to add Sol as a plaintiff. We agree because Sirimanne and CSDS
fail to articulate any facts or legal theories that would have been changed by the proposed
amendment and Sirimanne and CSDS would not have been prejudiced.
Code of Civil Procedure section 473, subdivision (a)(1) provides, in pertinent part,
“The court may, in furtherance of justice, and on any terms as may be proper, allow a
party to amend any pleading or proceeding by adding or striking out the name of any
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party . . . .”2 A pleading may be amended before or after commencement of trial in the
furtherance of justice and upon such terms as may be proper. (§ 576.) “No variance
between the allegation in a pleading and the proof is to be deemed material, unless it has
actually misled the adverse party to his prejudice in maintaining his action or defense
upon the merits.” (§ 469.) “Such amendments at trial to conform to proof, ‘if not
prejudicial, are favored since their purpose is to do justice and avoid further useless
litigation.’ [Citation.]” (Garcia v. Roberts (2009) 173 Cal. App. 4th 900, 909.) Granting
or denying leave to amend a complaint is within the discretion of the trial court; the
exercise of that discretion will not be disturbed on appeal absent a clear showing of
abuse. (Branick v. Downey Savings & Loan Assn. (2006) 39 Cal. 4th 235, 242.)
“‘Generally, a different plaintiff [is] substituted in because there [is] a technical
defect in the plaintiff’s status (an administrator for a deceased plaintiff; a stockholder in
place of a corporation; etc.); a necessary party [is] joined; or a nominal plaintiff [is]
removed and the real party in interest [takes] his place.’ [Citations.]” (Pasadena
Hospital Assn., Ltd. v. Superior Court (1988) 204 Cal. App. 3d 1031, 1035.) Thus,
“[C]ourts have permitted plaintiffs who have been determined to lack standing, or who
have lost standing after the complaint was filed, to substitute as plaintiffs the true real
parties in interest. (Klopstock v. Superior Court [(1941)] 17 Cal. 2d 13, 19–21
[administrator of deceased shareholder’s estate substituted as plaintiff in corporate
derivative action]; see also Haley v. Dow Lewis Motors, Inc. [(1999)] 72 Cal. App. 4th
497, 506–509 [trustee in bankruptcy substituted for bankrupt debtors]; California Air
Resources Bd. v. Hart (1993) 21 Cal. App. 4th 289, 300–301 [Attorney General substituted
for state administrative agency]; Jensen v. Royal Pools (1975) 48 Cal. App. 3d 717, 720–
723 [condominium owners substituted for owners’ association]; Powers v. Ashton (1975)
45 Cal. App. 3d 783, 790 [trustees substituted for nontrustee administrator].) Amendments
for this purpose are liberally allowed. (Klopstock v. Superior Court, supra, at pp. 19–21;
5 Witkin, Cal. Procedure (4th ed. 1997) Pleading, § 1126, p. 581; id., § 1155, p. 614.)”
2 Undesignated statutory references are to the Code of Civil Procedure.
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(Branick v. Downey Savings & Loan Assn., supra, 39 Cal.4th at p. 243.) “The important
limitation on the rule just mentioned is that the plaintiff proposed to be substituted may
not ‘state facts which give rise to a wholly distinct and different legal obligation against
the defendant.’ (Klopstock v. Superior Court, supra, 17 Cal.2d at 13, 20.) For this
purpose, ‘[i]n determining whether a wholly different cause of action is introduced by the
amendment technical considerations or ancient formulae are not controlling; nothing
more is meant than that the defendant not be required to answer a wholly different legal
liability or obligation from that originally stated.’ (Ibid.)” (Branick v. Downey Savings
& Loan Assn., supra, 39 Cal.4th at pp. 243–244.) Accordingly, “‘The cases on amending
pleadings during trial suggest trial courts should be guided by two general principles:
(1) whether facts or legal theories are being changed and (2) whether the opposing party
will be prejudiced by the proposed amendment. . . .’ [Citation.]” (Garcia v. Roberts,
supra, 173 Cal.App.4th at p. 910.)
Pasadena Hospital Assn., Ltd. v. Superior Court, supra, 204 Cal. App. 3d 1031, is
illustrative. There, the appellate court concluded that the trial court did not abuse its
discretion in granting the plaintiff doctor leave to amend his complaint to name his
professional corporation as a new party plaintiff because adding the plaintiff doctor’s
professional corporation remedied a technical defect; the claims of the plaintiff doctor
and the corporation arose from the same conduct on the defendant’s part; the harm to the
plaintiff doctor and the corporation “do not appear to be distinct”; the substantive basis of
the cause of action was not changed; the defendant hospital “should have been aware of
the existence of the corporation at the time” the plaintiff doctor filed his original
complaint; no new facts were alleged as a basis for recovery; and no possible prejudice to
the defendant would result. (Id. at pp. 1036–1037.)
Under the foregoing authorities, we determine that the trial court erred in denying
Costa’s motion to amend to add Sol as a plaintiff because Sirimanne and CSDS fail to
articulate any facts or legal theories that would have been changed by the proposed
amendment; Costa’s lack of standing in the fraud and breach of written contract actions
was a technical defect that would have been cured by adding Sol as the real party in
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interest; and the allegations of the complaint and the proposed amended complaint arose
from the same alleged conduct on Sirimanne and CSDS’s part, namely, their breach of
the terms of the Lease/Purchase Agreement; fraudulent misrepresentations inducing
Costa, on behalf of Sol, to enter into the Lease/Purchase Agreement; and fraudulent
misrepresentations regarding subsequent plans to sell or lease one or both of the aircraft.
Further, CSDS’s cross-complaint illustrates that CSDS was not “‘required to
answer a wholly different legal liability or obligation from that originally stated.’”
(Branick v. Downey Savings & Loan Assn., supra, 39 Cal.4th at pp. 243–244.) The cross-
complaint was filed against Costa doing business as Sol, but named Sol as a party and
described it as a company organized under the laws of the Dominican Republic. It also
alleged that “Costa, on behalf of SOL,” entered into negotiations regarding the lease of
the two aircraft; “SOL and CSDS” executed the Lease/Purchase Agreement; at the time
of delivery of the first aircraft, “SOL” had not fulfilled certain conditions required under
the Lease/Purchase Agreement, including paying the balance of the deposit; “SOL”
defaulted on its lease payments; “SOL” flew the first aircraft to Brazil and then to
Paraguay without obtaining proper documentation; and “SOL” failed to perform regular
maintenance on the first aircraft as required. The cross-complaint also alleged that in
order to avoid having a lien placed on the first aircraft, CSDS had to pay a third party for
parts and services for the first aircraft upon the failure of “SOL” to do so and that because
“SOL” had not fulfilled certain conditions, “SOL” requested CSDS to maintain
possession of the second aircraft until “SOL” was ready to take delivery. Further, it
alleged that in reliance on “SOL’s” representations that it was in the process of obtaining
proper documentation, CSDS did not sell the second aircraft to a potential buyer. And
the cross-complaint prayed for damages against Sol that arose “[a]s a result of SOL’s”
actions. Thus, no significant facts or legal theories would have been changed by the
amendment; and the answer and cross-complaint would not have been materially
different had Sol been named as a plaintiff in the complaint.
Nevertheless, Sirimanne and CSDS claim that the trial court did not err in denying
Costa’s motion to amend the complaint, arguing that Sirimanne and CSDS would have
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incurred substantial prejudice. Sirimanne and CSDS argue that because Costa “waited
until the entire case had been presented and all examinations had been exhausted to
request leave” to amend, Sirimanne and CSDS were limited in their options for defense
and subjected to substantial prejudice. We disagree.
Cal. Gas. Retailers v. Regal Petroleum Corp. (1958) 50 Cal. 2d 844 is instructive.
That case held, “[A] court may, in its discretion, permit amendment of pleadings after the
evidence is all in, pending argument of counsel, and even after submission of the cause.”
(Id. at p. 851.) There, the plaintiff, a nonprofit corporation, made a motion to amend the
complaint to add the president of the corporation as a party plaintiff after the evidence
had been concluded and both parties had rested. (Id. at p. 848.) The trial court granted
the motion the day it rendered its decision, which our Supreme Court affirmed on appeal,
explaining, “The amendment to the complaint stated no new cause of action against the
defendants, nor did it state any new facts. It does not appear that defendants were
prejudiced thereby and the court did not abuse its discretion in permitting
the amendment and inclusion of [the president] as plaintiff so that the pleadings would
conform to the proof.” (Id. at p. 851.)
As noted, the proposed amendment did not state a new cause of action against
Sirimanne and CSDS or state any new facts. Nor have Sirimanne and CSDS established
any prejudice to them by Costa’s failure to amend the complaint earlier. Sirimanne and
CSDS argue they were unable to conduct discovery on Sol and that their counsel’s failure
to conduct discovery “may well have been a prudent attempt to avoid wasting time and
resources.” This is mere speculation. In any case, Sirimanne and CSDS had stopped
communicating with their counsel, who withdrew as their attorney, declaring she was
“not in a position to respond to” written discovery propounded by Costa because
Sirimanne and CSDS did not return her phone calls or e-mails. As stated, the cross-
complaint alleged that Sol was a corporate entity, party, and cross-defendant and that the
Lease/Purchase Agreement was signed by Costa, as the president of Sol, and Sirimanne,
as the president of CSDS. Accordingly, we reject Sirimanne and CSDS’s argument that
they did not conduct discovery because Costa was “‘the only plaintiff.’”
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Nor are we convinced by Sirimanne and CSDS’s argument that “if Sirimanne and
CSDS had been defending a case against SOL, they might not have waived their right to
a jury trial.” Sirimanne and CSDS do not support this contention by anything other than
speculation and thus have not shown prejudice in this regard.
We conclude that because the proposed amendment would not have changed the
facts or legal theories and Sirimanne and CSDS would not have been prejudiced, the trial
court erred in denying Costa’s motion to amend the complaint.3
B. Substantial evidence supports the judgment in favor of Costa and against
Sirimanne as individuals in Costa’s breach of contract action regarding the Boeing
Agreement
Sirimanne and CSDS contend that insufficient evidence supports the judgment in
favor of Costa and against Sirimanne as individuals in Costa’s breach of contract action
regarding the Boeing Agreement. We disagree.
“Ordinarily, . . . a reviewing court is required to infer any factual findings
necessary to support the judgment. [Citations.] This rule ‘is a natural and logical
corollary to three fundamental principles of appellate review: (1) a judgment is presumed
correct; (2) all intendments and presumptions are indulged in favor of correctness; and
(3) the appellant bears the burden of providing an adequate record affirmatively proving
error.’ [Citation.]” (Ermoian v. Desert Hospital (2007) 152 Cal. App. 4th 475, 494.) “In
reviewing a challenge to the sufficiency of the evidence, we are bound by the substantial
evidence rule. All factual matters must be viewed in favor of the prevailing party and in
support of the judgment. All conflicts in the evidence must be resolved in favor of the
3 On appeal, Costa does not articulate a cogent argument or cite authority as to
why the trial court erred in finding in favor of Sirimanne and CSDS on the remaining
causes of action for quantum meruit and “restraining order.” Accordingly, Costa has
forfeited those issues on appeal. (Mansell v. Board of Administration (1994) 30
Cal. App. 4th 539, 545–546 [if appellant’s brief does not contain a legal argument with a
citation of authorities on the point made, the court need not furnish argument or search
the record for support for appellant’s contention but may treat it as forfeited and pass it
without consideration].)
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judgment.” (Turman v. Turning Point of Central California, Inc. (2010) 191 Cal. App. 4th
53, 58.)
Sirimanne and CSDS contend that neither the Letter of Agreement, the March e-
mail, “nor the trial testimony regarding these documents provide sufficient evidence to
support entering a judgment against Sirimanne” as an individual with respect to the
Boeing Agreement. Sirimanne and CSDS contend that the Letter of Agreement showed a
signature line for Costa, as president of Sol, and because Costa brought the action in his
individual capacity, he lacked standing to recover against CSDS. Further, Sirimanne and
CSDS urge that because Sirimanne signed the March e-mail as the president of CSDS, he
acted merely as an agent and there was no evidence to support a judgment against him
individually.
We conclude that substantial evidence supports the trial court’s conclusion that
Costa and Sirimanne entered into the Boeing Agreement in their individual capacities.
Costa’s testimony that Sirimanne asked him to arrange a meeting between Sirimanne and
the CEO of Lloyd in order to facilitate the sale of a Boeing aircraft supports the
conclusion that he entered into the Boeing Agreement as an individual. Costa testified
that Sirimanne had told him, “[H]e [Sirimanne] would pay $300,000, [$]100,000 for each
of us to help him in this meeting.” With reference to the March e-mail, Costa testified
“also on the agreement when the plane would leave Brazil, he [Sirimanne] would pay the
$300,000,” and “[t]his document, it’s where he [Sirimanne] agrees that he’s going to pay
$300,000 to me, to Paulo and to Sturno as soon as the plane would leave Brazil.” (Italics
added.) Sirimanne did not challenge Costa’s testimony in this regard. Sirimanne and
CSDS’s counsel agreed with the court that Sirimanne did not testify he entered into the
Boeing Agreement as an agent of CSDS. And Sirimanne testified that he did not sign the
Letter of Agreement which indicated he signed on behalf of CSDS. Thus, the court
reasonably concluded Sirimanne entered into the agreement in his personal capacity,
noting that Sirimanne never testified that he entered into the Boeing Agreement as the
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agent of CSDS and commenting that “[a] lot of people use paperwork that has the name
of the company on it.”4
We conclude that substantial evidence supported the judgment in favor of Costa
and against Sirimanne as individuals with respect to the Boeing Agreement.
C. We affirm the trial court’s order denying Sirimanne and CSDS’s motion for
attorney fees
Sirimanne and CSDS appeal from the trial court’s order denying their motion for
attorney fees, claiming they are prevailing parties under Civil Code section 1717 with
respect to the causes of action regarding the Lease/Purchase Agreement. We disagree
because we are reversing the trial court’s order denying Costa’s motion to amend the
complaint with respect to the causes of action regarding the Lease/Purchase Agreement
and therefore the prevailing party will be determined on retrial.
4 At trial, in response to an inquiry by the trial court as to whether Sirimanne was
being sued as an individual on the breach of the Boeing Agreement, Costa’s counsel
replied in the affirmative and Sirimanne’s counsel did not comment. Therefore,
Sirimanne was on notice of this variance in proof. (§ 469 [“No variance between the
allegation in a pleading and the proof is deemed material, unless it has actually misled the
adverse party to his prejudice in maintaining his action or defense upon the merits.”].)
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DISPOSITION
The trial court’s order denying Eduardo Costa’s motion to amend the complaint to
add Sol Dominicana Airlines as a plaintiff is reversed, and the trial court is directed to
issue an order allowing the amendment. The trial court’s order denying Sirimanne and
CSDS Aircraft Sales & Leasing, Inc.’s motion for attorney fees is affirmed. In all other
respects, the judgment is affirmed. Eduardo Costa is entitled to costs on appeal.
NOT TO BE PUBLISHED.
MALLANO, P. J.
We concur:
ROTHSCHILD, J.
JOHNSON, J.
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