Filed 8/18/26 Esensten v. Leavitt CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
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COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
MITRA K. ESENSTEN as Trustee, etc. D086505
et al.,
Plaintiffs and Appellants,
(Super. Ct. No. 37-2023-
v. 00043136-CU-BC-NC)
DAVID LEAVITT, et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of San Diego County,
Cynthia A. Freeland, Judge. Affirmed.
Esensten Law, Robert L. Esensten and Randi R. Geffner, for Plaintiffs
and Appellants.
Amanda De La Vega, for Defendants and Respondents.
I.
INTRODUCTION
Mitra K. Esensten as Trustee of the Karubian 2021 Irrevocable Trust
(the trust), Mitra Esensten (in her individual capacity), and Sydney Esensten
(collectively appellants) sued David Leavitt (Mr. Leavitt), Caroline Leavitt
(Ms. Leavitt), Kaci Vanderhoek, Baron & Baroness Jewels, Inc., Antique and
Estate Jewelry Ltd., dba LUX USA,1 LUX USA, LUX Estate Sales, and LUX
USA Jewelry (collectively respondents) for damages alleging respondents
stole items from an estate sale that appellants hired them to conduct. After a
bench trial, the court issued a statement of decision in favor of respondents.
On appeal, appellants claim the trial court abused its discretion: (1) in
finding respondents were not in breach of contract; (2) as it related to
supporting alter ego liability, by ignoring respondents’ failure to comply with
corporate formalities; and (3) improperly failing to award damages against
defaulted parties. Additionally, appellants allege the court improperly
interpreted and applied a contract provision. Rejecting these arguments, we
affirm.
II.
FACTUAL AND PROCEDURAL BACKGROUND2
Cyrus and Houri Karubian (the Karubians) were married and had two
children, Mitra and Frederick. Mitra has a daughter, Sydney. The
Karubians owned a house in Beverly Hills where Cyrus kept many antiques.
Cyrus passed away in 2013, and around 2021, a written inventory was
prepared listing over two hundred antiques, art, and collectibles in the house.
Houri passed away in 2022. At that time, Mitra was the trustee of the trust.
1 The trial court referred to Baron and Baroness Jewels, Inc. doing
business as Antique and Estate Jewelry Ltd, DBA Lux USA as “A&E”
explaining, to the extent that they are legal corporate entities, Mr. Leavitt
testified there is no legal distinction between or among these corporate
entities.
2 Because there is no reporter’s transcript of the trial, we derive our
factual summary primarily from the court’s statement of decision and other
portions of the clerk’s transcript.
2
After consulting with real estate brokers, the family decided that before
selling the house, they needed to sell the many collected objects in it.
Mitra found A&E and sought to have them conduct an estate sale
comprising many of the things at the property. Mitra left a message for
Mr. Leavitt about conducting the sale. Vanderhoek, Mr. Leavitt’s employee,
returned the call and visited the residence. Using FaceTime Mr. Leavitt was
able to see the contents of the property as Mitra and Vanderhoek walked
through it. Mr. Leavitt believed the estate sale could gross receipts in the six
figures and agreed to reduce A&E’s commission to 18 percent. Mitra
explained to Vanderhoek that the family reserved the right to review all
items and take what they wanted before the estate sale. Also, Mitra said she
would review Houri’s personal belongings and identify which of those would
be included in the estate sale. Vanderhoek then took 642 photographs of
items that she understood would be offered for sale.
Vanderhoek prepared an Estate Sale Agreement (the agreement),
listing the parties as Mitra in her capacity as Trustee of the trust, and A&E.
Mitra signed the agreement without first consulting an attorney. Among
other terms, the agreement included:
“1. The Client will remove and pack all personal items from
the premises prior to the sale that are not being sold.”
“2. The space will be cleared of personal belongings by
August 20, 2022, all items that remain in the home will be
sold. For bigger items that cannot be moved, please place a
note ‘SOLD’ on the item.”
“[¶] . . . [¶]”
“5. Throughout the liquidation process, your household
contents that are not sellable will be donated or discarded.
If we find anything of a personal nature or memory related,
we will put them aside in a box for safekeeping.”
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“[¶] . . . [¶]”
“10. We ask your permission to be able to sell something to
a customer before the sale if they are not able to attend the
advertised date of the sale. They will be sold at full price.
This is called our ‘buy ahead option’ and is very
successful.”
The agreement also stated that A&E would not provide “a complete
inventory but can provide copies of the receipts of what sold upon request.”
The contract included a timeline for reviewing the objects for sale,
appraising, marketing and private pre-sale of pieces, and a schedule for the
estate sale itself. It also had a “buyout” provision, which included the
statement, initialed by Mitra, that “Client agrees to independent buy-out
and/or consignment offer to be determined based on what items are left after
the sale.” The agreement also contained a “Transfer of Property” provision,
which provided:
“After signing, all items on the property will become
Antique and Estate Jewelry property. Any sales will be
recorded for commission to Antique and Estate Jewelry.
Any items staying on the property to be included for the
new owner must be noted before handing over the keys.”
After signing the agreement, Mitra provided A&E staff with a key to
the property so they could clean and sort the sale pieces. Mitra regularly
visited the home and frequently vacillated about what items would be
included in the estate sale. Up until August 2022,3 she had been at the
property daily but still needed to go through Houri’s personal items and was
unsure which items would be included in the sale. Vanderhoek offered to
assist Mitra to move items that Mitra wished not to sell upstairs. That
3 All date references are to 2022.
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portion of the property would be blocked off to estate sale patrons. To ensure
there were sufficient items to sell, A&E brought numerous items it owned to
display at the property, including jewelry.
The estate sale took place from August 25 through August 27.
Vanderhoek communicated with Mitra during these dates about items to be
sold or removed from the sale. When the event ended on August 27, Mitra
and Sydney walked the property to see what remained. Neither expressed
any concerns to Mr. Leavitt or Vanderhoek. In September, Sydney returned
to the property. After walking through she compared her observations of the
remaining contents with information from other sources, and receipts
provided by Vanderhoek. Sydney concluded some pieces were inexplicably
missing from the residence. Sydney then compiled two documents with
pictures of things she identified as absent but acknowledged at trial that she
could not decipher the receipts provided by A&E and did not know, and could
not tell, if these items had been sold or stolen. She also did not consult any
family members or beneficiaries for a list of items taken from the property
before the estate sale. Further, Sydney did not have any family members
review the document she prepared to ascertain whether these family
members or beneficiaries possessed any of the objects she listed.
On September 17, Attorney Robert Esensten, Mitra’s husband, emailed
Vanderhoek requesting information related to certain items to determine
which had been sold and what items may be unaccounted for or otherwise
missing. Vanderhoek gave Mr. Esensten access to the estate sale receipts
and mailed a check, payable to the trust, for the sale proceeds minus A&E’s
commission. Vanderhoek explained that descriptions of things on the
receipts were vague given the number of onsite staff available to write
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receipts and the number of patrons purchasing pieces. Appellants never
cashed the check.4
Sydney and Mitra began monitoring estate sale websites to determine
whether any of the pieces they believed missing were advertised for sale
elsewhere. On October 12, Mitra found an advertisement for an estate sale
in Carlsbad with photographs of items that Mitra and Sydney believed were
at the property during the estate sale. Instead of contacting Mr. Leavitt or
Vanderhoek, they hired a private investigator who purchased several items,
including a painting that Mitra believed belonged to the trust. Appellants
filed this action on October 24. On October 27, Mr. Esensten spoke to
Mr. Leavitt about items he believed belonged to the trust. Without agreeing
with Mr. Esensten, Mr. Leavitt allowed Mr. Esensten to take anything he
believed came from the property in an effort “to be done with the Esenstens.”
Appellants removed 53 items which A&E staff photographed.
Sydney and Mitra continued to monitor estate sale websites. In 2024,
they saw what they believed was trust property advertised for sale at a
location operated by Mr. Leavitt in Las Vegas, Nevada. Mitra identified four
items that she believed belonged to the trust. Those were turned over to
Mr. Leavitt’s counsel to maintain until the time of trial, at which time the
items were given to Mitra.
In February, with no responsive pleadings filed, the court defaulted all
defendants except Mr. Leavitt, in his individual capacity. Appellants filed a
trial brief and a summary of damages “against all defendants” listing the
value of the stolen goods, expenses included, emotional distress damages to
4 After the close of evidence, appellants learned that respondents had
stopped payment on the check. Accordingly, the court noted in the statement
of decision that respondents needed to retender the check.
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Mitra and Sydney, and punitive damages. The court conducted a reported
bench trial on the remaining causes of action for breach of contract,
intentional infliction of emotional distress, fraud, common count (money had
and received), and conversion. It issued a proposed statement of decision
finding in favor of Mr. Leavitt on all causes of actions. Appellants objected to
statement of decision. After carefully considering those objections, the court
issued a final statement of decision and final judgment.
III.
DISCUSSION
A. Alleged Breach of Contract
On the breach of contract claim, the trial court concluded that
respondents performed all material obligations they had under the
agreement. Appellants claim this conclusion is erroneous because
respondents were required to tender a check to the trust for their share of the
sale proceeds but respondents stopped payment on the check. Appellants
further assert that, at the time of the final statement of decision, respondents
were in breach of contract and the court’s determination otherwise affected
appellants’ claim for intentional infliction of emotional distress. We conclude
this issue is moot.
A court’s role is to adjudicate concrete controversies by rendering
enforceable judgments, not to opine on moot questions, abstract propositions,
or rules of law not affecting the matter at issue. (In re D.P. (2023) 14 Cal.5th
266, 276.) Accordingly, an appeal is considered moot where subsequent
events make it impossible for the appellate court to grant any meaningful
relief to the appellant. (Lockaway Storage v. County of Alameda (2013)
216 Cal.App.4th 161, 175.)
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Here, no effective relief is available. The relevant facts are undisputed.
Respondents issued a check payable to the trust for net sale proceeds but
appellants did not cash it. Respondents later stopped payment; and,
following the court’s direction, respondents re-tendered the payment, which
appellants acknowledge receiving.
Whether respondents’ stop payment on the initial check constituted a
breach is now immaterial because appellants have received the full payment
owed. Any ruling on whether the stop payment on the initial check
constitutes a breach would constitute an advisory opinion, which courts do
not issue. (Younger v. Superior Court (1978) 21 Cal.3d 102, 119 (Younger)
[“ ‘The rendering of advisory opinions falls within neither the functions nor
the jurisdiction of this court.’ ”].) Appellants’ attempt to avoid mootness by
linking this issue to their emotional distress claim also fails. The trial court
rejected that claim not for lack of breach, but because respondents did not
owe a special relationship to Mitra and Sydney in their individual capacities
and because the evidence did not establish severe, enduring distress of a kind
no reasonable person should be expected to bear. Thus, even if a breach were
assumed, it would not alter the judgment on that independent claim.
B. No Error in Interpreting Contract Provision
In connection with the breach of contract claim, the trial court found
appellants failed to demonstrate by a preponderance of the evidence, that
Mr. Leavitt or any of the other defendants wrongfully took any items from
the property or that the trust suffered any damages as a result of conduct
attributed to A&E or any other entity. In a footnote, the court stated:
“To this point, Plaintiffs never adequately addressed how, if items
remaining at the end of the Trust estate sale were taken, the
‘Transfer of Property’ provision in the Agreement would not have
authorized such a taking. See Trial Ex. 1–3. While it is true that the
‘Transfer of Property’ provision seems inconsistent with other
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provisions in the Agreement, Plaintiffs offered no evidence to
undermine the position taken by Defendants as to the effect of the
‘Transfer of Property’ provision. To the contrary, Mitra’s testimony
of the provision, and more particularly that she understood the
provision to mean that A&E was ‘representing’ Plaintiffs at the Trust
estate sale, which understanding [sic] lacks any connection to the
plain language of the provision.”
Appellants argue that the court improperly interpreted the transfer of
property provision to allow respondents to take all trust property. They
contend the court’s interpretation was erroneous and this court should review
the provision’s meaning de novo. Respondents counter that the court
considered conflicting extrinsic evidence regarding the parties’ understanding
of the provision, making the issue subject to substantial evidence review,
and, in any event, the court independently found appellants failed to prove
damages.
Even assuming, arguendo, that the trial court erred in interpreting the
transfer of property provision, reversal is unwarranted. Appellants do not
challenge the court’s separate and determinative finding that they failed to
prove respondents caused the trust to suffer any damages. This leads to two
conclusions. First, appellants waived their challenge to the alternative
finding by failing to contest it on appeal with a separate argument heading
accompanied by legal analysis. (Roe v. McDonald’s Corp. (2005)
129 Cal.App.4th 1107, 1114 (Roe); Cal. Rules of Court, rule 8.883(a)(1)(A)
[appellate briefs must state each point under a separate heading].)
“Moreover, ‘[a]n issue merely raised by a party without any argument or
authority is deemed to be without foundation and requires no discussion.’
[citation].” (Roe, supra, at p. 1114.) Second, because the trial court’s
alternative finding constitutes an independent, unchallenged ground for
affirmance, it conclusively disposes of the issue. This renders any dispute
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over the meaning of the transfer of property provision immaterial to the
judgment. Resolving that disagreement now would require this court to issue
an advisory opinion, which as explained, we will not do. (Younger, supra,
21 Cal.3d at p. 119.)
C. Defaulted Defendants
On January 25, 2023, the court entered default against Antique and
Estate Jewelry LTD (dba LUX USA). On February 27, 2024, the court also
defaulted Ms. Leavitt, Vanderhoek, Baron & Baroness Jewels, Inc., LUX
USA, LUX Estate Sales, and LUX USA Jewelry (collectively the defaulted
defendants). In December 2024, appellants filed a damages summary and
served it on Mr. Leavitt through his attorney of record, Amanda De La Vega.
The register of actions reflects that Ms. De La Vega initially
represented all respondents, but a motion to be relieved as counsel was filed
in January 2024. Although that motion and ruling are not in the record, the
December 2024 proof of service reflects service on Ms. De La Vega as counsel
for Mr. Leavitt. Nothing in the record shows that appellants served any of
the defaulted defendants with the damages summary.
The trial court denied entry of default judgment, finding appellants
failed to show service of the damages statement on the defaulted defendants
and that the complaint did not specify the amount of damages sought.
Appellants argue this was an abuse of discretion. Appellants assert the
damages summary applied to “all” defendants and was properly served on
Ms. De La Vega, whom they contend remained defaulted parties’ counsel of
record. Respondents counter that appellants failed to satisfy the statutory
prerequisites for default damages because no compliant damages statement
was served on the defaulted defendants before entry of default. We agree
with respondents.
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Before a default is entered on a complaint to recover damages for
personal injury, plaintiffs are required to give notice to defendants “of the
amount of special and general damages sought to be recovered.” (Code Civ.
Proc., § 425.11, subd. (b).) The statement must be served in the same manner
as a summons, before a default may be entered on the underlying complaint.
(Code Civ. Proc., § 425.11, subd. (d)(1).)
Here, defaults were entered in January 2023 and February 2024, yet
appellants did not serve their damages statement until December 2024.
Even assuming Ms. De La Vega continued to represent the defaulted
defendants at the time of service, service of the damages statement after
entry of default was legally ineffective. Because compliance with Code of
Civil Procedure section 425.11 is a prerequisite to obtaining a default
judgment for personal injury damages, appellants’ failure to serve the
required notice before entry of default is fatal to their request for default
judgments. Moreover, as addressed above, appellants also failed to prove
recoverable damages on their breach of contract claim, providing an
additional basis supporting the denial of default judgments.
D. Alleged Failure to Comply with Corporate Formalities
The operative complaint alleged that the individual defendants were
alter egos of the other defendants. In their trial brief, appellants argued that
Mr. Leavitt is the alter ego of A&E and should not be permitted to use the
corporate form as a shield from liability. In its statement of decision, the
court noted that A&E was a suspended corporation that Mr. Leavitt used as a
fictitious business name for Baron & Baroness Jewels, Inc. (Baron). The
court further observed that Baron maintained a corporate bank account and
was the entity under which Mr. Leavitt operated “ ‘Antique and Estate
Jewelry Ltd (DBA Lux USA).’ ” The evidence also showed that Mr. Leavitt
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was a 50 percent owner of Baron, which did business as A&E. The court,
however, found appellants failed to meet their burden of demonstrating
Mr. Leavitt was the alter ego of A&E.
Appellants contend the evidence does not support the trial court’s
conclusion that Baron was the operative corporate entity, and party, to the
agreement. Appellants argue the corporate entities were mere shams and
that piercing the corporate veil was necessary to prevent injustice and hold
Mr. Leavitt liable.
A corporation is ordinarily regarded as a legal entity, separate and
distinct from its shareholders, officers, and directors. (Sonora Diamond
Corp. v. Superior Court (2000) 83 Cal.App.4th 523, 538.) Nevertheless, that
distinction may be disregarded where an abuse of the corporate form makes
it inequitable to allow shareholders to shield themselves from liability.
(Ibid.) That alter ego liability applies only in extraordinary circumstances
where “some conduct amounting to bad faith makes it inequitable for the
corporate owner to hide behind the corporate form.” (Id. at p. 539.) Alter ego
liability is sparingly used and the plaintiff bears the burden of proving each
element by a preponderance of the evidence. (Angel Lynn Realty, Inc. v.
George (2025) 114 Cal.App.5th 655, 665.)
Whether the alter ego doctrine applies is a question of fact reviewed for
substantial evidence. (Jack Farenbaugh & Son v. Belmont Constr. (1987)
194 Cal.App.3d 1023, 1032.) Relevant factors include commingling of assets,
treatment of corporate property as personal property, representations of
personal liability, failure to observe corporate formalities, sole or
concentrated ownership, dominion and control, use of the same address,
undercapitalization, and failure to maintain arm’s length transactions with
12
the corporation. (Mid-Century Ins. Co. v. Gardner (1992) 9 Cal.App.4th 1205,
1213, fn. 3.)
First, appellants argue the evidence does not support the trial court’s
conclusion that Baron was the operative corporate entity and party to the
agreement. However, they presented no evidence identifying any alternative
entity that should have been deemed the contracting party. On this record,
this results in a failure to demonstrate error.
Second, with respect to alter ego liability, appellants likewise failed to
present evidence addressing the governing factors as to any defendant entity.
Their reliance on failures to follow corporate formalities, standing alone, is
insufficient to establish alter ego liability or to overcome the presumption of
corporate separateness. (Virtualmagic Asia, Inc. v. Fil-Cartoons, Inc. (2002)
99 Cal.App.4th 228, 245 [no single factor is determinative and all
circumstances must be examined].)
In any event, even assuming arguendo the court erred in rejecting
appellants’ alter ego theory, any such error would be harmless. The trial
court entered judgment in favor of respondents on all substantive causes of
action. Accordingly, alter ego liability would not change the outcome.
Moreover, as discussed in part III, appellants were not entitled to default
judgments against the defaulted defendants in any event.
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IV.
DISPOSITION
The judgment is affirmed. Respondents are awarded their costs on
appeal.
RUBIN, J.
WE CONCUR:
O’ROURKE, Acting P. J.
DO, J.
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