Develop. v. Braum
Filed 10/4/12 Curtom Building & Develop. v. Braum CA2/5
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 This opinion has not been certified for
publication or ordered published for purposes of rule 8.1115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
FIVE
CURTOM
BUILDING & DEVELOPMENT,
Plaintiff and Respondent,
v.
MICHAEL BRAUM, as the Trustee
of BRAUM LALEHZARAZADEH LIVING TRUST,
Defendant and Appellant.
B231396
(Los Angeles
County
Super. Ct.
No. BC397289)
APPEAL from
a judgment of the Superior Court
of
County, Mel Red Recana, Judge.
Affirmed.
Law Offices
of Rosenthal & Associates and Lisa F. Rosenthal, for Defendant and
Appellant.
Cohen &
Lord, Bruce M. Cohen and James F. Boyle, for Plaintiff and Respondent.
I. INTRODUCTION
Defendant, Michael Braum, as trustee of the
Braum-Lalehzarazadeh living trust, appeals from a January 7, 2011 final judgment. The judgment was entered after a
Building and Development
Corporation, a general contractor. The
trial court found plaintiff’s mechanic’s lien was valid and entered judgment
foreclosing on a commercial development currently owned by defendant. According to defendant, plaintiff cannot
foreclose on the mechanic’s lien. Defendant
reasons plaintiff failed to prove that each subcontractor who performed work on
the project was a duly licensed contractor.
Defendant argues Business and Professions Code section 7031, subsection
(a) bars plaintiff from recovery because plaintiff seeks compensation for work
performed by an unlicensed subcontractor.
subcontractor was in fact licensed.
II. BACKGROUND
On November 6, 2006, plaintiff entered into a contract with
Dr. Marcus Pride, the original owner of property located in Inglewood,
California.
Plaintiff agreed to act as the general contractor for commercial
development of the property. Plaintiff
retained West American Design and Development as the primary subcontractor to
perform some of the work under the contract.
On April 5, 2008,
plaintiff ceased construction on the commercial development when it stopped
getting paid for its work. At no time
did defendant ever file an answer to the complaint. Moreover, prior to trial, defendant never
raised the issue of whether any subcontractor was licensed. Additionally, the answer filed by the bank
failed to raise any licensure issue concerning plaintiff or any
subcontractor.
On August
29, 2008, plaintiff recorded a mechanic’s lien against the property
in the amount of $180,622. The unpaid
amount owed by Dr. Pride included:
$73,717 for plaintiff’s retention; $8,035 for additional work performed
under the contract; $21,867 for work performed under change order No. 2; and
$78,801 for work performed under change order No. 3. West American Design and Development did the
work contained in change order Nos. 2 and 3.
Plaintiff and its subcontractor, West American Design and Development,
were not paid for their work.
On September
2, 2008, plaintiff filed a complaint asserting a claim for
foreclosure of mechanic’s lien against:
Dr. Pride; Shinhan Bank America
(the bank), Dr. Pride’s construction lender; West American Design and
Development; and San Gabriel Insulation, Inc.
In addition, plaintiff asserted claims for contract breach, open book
account, account stated and quantum meriut against Dr. Pride. Plaintiff alleged it was a licensed general
contractor under the laws of the State of California. In October 2008, West American Design and
Development and San Gabriel Insulation, Inc. were dismissed from the case after
they released their recorded mechanics’ liens.
During the
pendency of the action, in January 2009, defendant purchased Shinhan Bank America’s
note and trust deed in the property.
Defendant subsequently foreclosed on the property and became its
owner. In December 2009, defendant
joined the case as a party.
During
trial, plaintiff sought judicial notice of its contractor’s license. The trial court also heard testimony from
Benjamin Anthony Harris, the owner of West American Design and Development, plaintiff’s
primary subcontractor. During the
questioning of Mr. Harris, the following testimony was presented: “Q In
order for a corporation to have a valid contractor’s license, it has to have a
responsible managing agent or officer, correct?
[¶] . . . A
Yes. [¶] Q And
isn’t it also correct that the . . . responsible managing officer or agent, for
the corporation has to have its own individual license, correct? [¶]
A That’s correct. [¶] Q
And that individual license must be valid, correct? [¶]
A Yes. [¶]
Q Isn’t it true, Mr. Harris, that
your individual license has been suspended and he is no longer active? A It
has been suspended. It -- we just didn’t
insure it. . . A Q
Isn’t it true, Mr. Harris, that as a result of not carrying insurance,
your individual license was suspended by the Contractors[’] State Licensing
Board and has now been put on inactive status?
[¶] The Court: As of when?
[¶] Q By Ms. Rosenthal: During the time you were working on the
Curtom property -- working for [plaintiff] on the Prairie property? [¶]
A Well no. I requested it to be in active. [¶]
Q Correct. But it was - - [¶] A That was my request. I have a licensed corporation, and I have not
had a problem with it. . . . [¶]
Q By Ms. Rosenthal: Mr. Harris, isn’t it true that during the
time you were working on this project, you did not have insurance for your own
individual license? [¶] A Yes,
we did. [¶] Q And
as a result, that your license was suspended?
[¶] A No. I
requested them to be put on a particular status.â€
On January
7, 2011, the trial court issued its statement of decision. The trial court found plaintiff “was a duly
licensed general contractor throughout its work†on the project. The trial court found plaintiff’s mechanic’s
lien was valid and entered a judgment foreclosing on the property. On the same day, the trial court entered
judgment for plaintiff. The trial court
determined Dr. Pride owed plaintiff $236,305.70, which comprised of the
principal sum of $182,419.91 plus interest.
The trial court found plaintiff “has a lien on the real property†now
owned by defendant. The trial
court ordered foreclosure of the subject property to satisfy the money judgment
against Dr. Pride. On March 4, 2011,
defendant filed its notice of appeal.
III. DISCUSSION
A. Standard of Review
The appeal presents some questions of law which we review de
novo. (Allied Interstate, Inc. v. Sessions Payroll Management, Inc. (2012)
203 Cal.App.4th 808, 817; Broney v.
California Commission on Teacher Credentialing (2010) 184 Cal.App.4th 462,
472.) An error of law will not be reversed
unless it is prejudicial resulting in a miscarriage of justice. (Broney
v. California Commission on Teacher Credentialing, supra, 184 CalApp.4th at
p. 472; Winfred D. v. Michelin North
America, Inc. (2008) 165 Cal.App.4th 1011, 1038.) However, there are other issues which
are subject to substantial evidence review.
(Bickel v. City
1040, 1053; Crawford v. Southern Pacific
Co. (1935) 3 Cal.2d 427, 429.) For
example, whether the subcontractor, West American Design and Development, was
properly licensed, was the subject of testimony by Mr. Harris. As we will explain, it was for the trial
court to resolve the ambiguities in his testimony. When
the trial court is silent on a matter, w
point. (Blankenship v. Allstate Ins. Co. (2010) 186 Cal.App.4th 87,
104-105; Atlantic Richfield Co. v. California (1989) 214 Cal.App.3d 533, 538.)
As the Supreme Court
has stated: “‘A judgment or order of the
lower court is presumed correct. All intendments and presumptions are indulged
to support it on matters as to which the record is silent, and error must be
affirmatively shown.â€â€™ (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; Wilson
v. Sunshine Meat & Liquor Co. (1983) 34 Cal.3d 554, 563.)
B.
Section 7031 Does Not Bar Plaintiff’s Claim for Foreclosure of
Mechanic’s Lien
Section 7031, subdivision (a) generally prohibits
unlicensed contractors from recovering compensation for performance of work
requiring a license. Section
7031, subdivision (a) states: “Except as provided in subdivision (e), no
person engaged in the business or acting in the capacity of a contractor, may
bring or maintain any action, or recover in law or equity in any action, in any
court of this state for the collection of compensation for the performance of
any act or contract where a license is required by this chapter without
alleging that he or she was a duly licensed contractor at all times during the
performance of that act or contract, regardless of the merits of the
cause of action brought by the person. . . .†If licensure is controverted, the plaintiff
must prove that it held all necessary licenses during performance of the work
by producing a verified certificate of licensure from the Contractors’ State License Board. (§ 7031, subd. (d).)
Our Supreme Court has explained
“The purpose of the licensing law is to protect the public from
incompetence and dishonesty in those who provide building and construction
services.
assurance that all persons offering such services in California have the requisite
skill and character, understand applicable local laws and codes, and know the
rudiments of administering a contracting business. [Citations.]
[¶] Section 7031 advances this purpose by
withholding judicial aid from those who seek compensation for unlicensed
contract work. The obvious statutory
intent is to discourage persons who have failed to comply with the licensing
law from offering or providing their unlicensed services for pay.†(Hydrotech Systems, Ltd. v. Oasis
Waterpark (1991) 52 Cal.3d 988, 995; Lewis
& Queen v. N.M. Ball Sons (1957) 48 Cal.2d 141, 149-150.) Section 7031, subdivision (a) bars unlicensed
contractors from maintaining any action for compensation regardless of the
equities. (MW Erectors, Inc. v. Niederhauser Ornamental and Metal Works Co., Inc. (2005)
36 Cal.4th 412, 423; Hydrotech Systems, Ltd. v. Oasis Waterpark, supra,
52 Cal.3d at p. 997.) Our Supreme Court has held: ‘“Section 7031 represents a legislative
determination that the importance of deterring unlicensed persons from engaging
in the contracting business outweighs any harshness between the parties, and that . . .
such deterrence can best be realized by denying violators the right to maintain
any action for compensation in the courts of this state. [Citation.]â€â€™
(Hydrotech Systems, Ltd. v. Oasis Waterpark, supra, 52 Cal.3d at
p. 995 quoting Lewis & Queen v. N.M.
Ball Sons, supra, 48 Cal.2d at p. 151; accord MW Erectors, Inc. v.
Niederhauser Ornamental and Metal Works Co., Inc., supra, 36 Cal.4th at p.
423.)
Defendant argues plaintiff is
barred from bringing its mechanic’s lien claim for foreclosure under section
7031, subsection (a). Defendant asserts
plaintiff failed to meet its prima facie burden of proving that its subcontractors
were licensed.
We need not resolve the question as
to whether it was a plaintiff’s duty to prove that Mr. Harris’s company was
licensed. There is no question that
substantial evidence supports the conclusion that plaintiff was licensed. As to Mr. Harris’s company, he was asked whether
his individual license had been suspended and he answered, “It hasn’t been
suspended.†Later, as noted, Mr. Harris
was asked about whether his individual license had been suspended. The following transpired: “Q
Isn’t it true, Mr. Harris, that as a result of not carrying insurance,
your individual license was suspended by the contractors [’] state licensing
board and has now been put on inactive status?
[¶] The Court: As of when?
[¶] Q . . .
During the time you were working on the Curtom property - - excuse me - - working for [plaintiff] on the
Prairie property? [¶] A
Well, no. I requested it to be
inactive. [¶] . . .
That was my request. I have a
licensed corporation, and I have not had a problem with it. [¶]
Q . . . Mr. Harris, isn’t it true that during the
time you were working on this project, you did not have insurance for your own
individual license? A Yes we did.
Q And as a result, that your
license was suspended? [¶] No. I
requested them to be put on a particular status.â€
The
foregoing constitutes substantial evidence that West American Design and
Development was licensed. The testimony
of a single witness can be sufficient to establish a fact. (In re
Marriage of Mix (1975) 14 Cal.3d 604, 614; Greenwich
S.F. LLC v. Wong (2010) 190 Cal.App.4th 739, 767-768.) When applying the substantial evidence test,
we must resolve all evidentiary conflicts and indulge in all reasonable
inferences in support of the judgment. (
1205-1206.) We may not substitute our
deductions for the reasonable inferences presumptively drawn by the trial
court. (Mah See v. North American Acc. Ins. Co. of Chicago, Ill. (1923) 190
Cal. 421, 426, overruled on another ground in Zuckerman v. Underwriters at Lloyd’s (1954) 42 Cal.2d 460, 474;
737, 752 [“On this record, we cannot say the inferences the trial court drew
were unreasonable, and this precludes us from overturning the court’s
determination.â€]; Milton v. Perceptual
Develop. Corp. (1997) 53 Cal.App.4th 861, 867 [“If the evidence gives rise
to conflicting inferences, one which supports the trial court’s findings, we
must affirm.â€].) Here, the trial court
could reasonably have concluded that West American Design and
Development was licensed during construction.
IV. DISPOSITION
The judgment is affirmed. Plaintiff, Curtom Building and Development
Corporation, shall recover its appeal costs from defendant, Michael Braum as
trustee of the Braum-Lalehzarazadeh Living Trust.
NOT
TO BE PUBLISHED IN THE OFFICIAL REPORTS
TURNER,
P. J.
We concur:
ARMSTRONG,
J.
MOSK, J.
and Professions Code unless otherwise indicated.
