Filed 6/22/26 Feng v. Hon CA2/2
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION TWO
CHEN FENG et al., B345950
Plaintiffs and Respondents, (Los Angeles County
Super. Ct. No.
v. 23PSCV03534)
BLAKE SING HON et al.,
Defendants and Appellants.
APPEALS from a judgment of the Superior Court of Los Angeles
County, Peter A. Hernandez, Judge. Affirmed.
Lexint Law Group and Robert Hsu for Defendant and Appellant
Blake Sing Hon.
Wayne R. Johnson & Associates and Wayne R. Johnson for
Defendant and Appellant LV Cheyenne LLC.
Mortenson Taggart Adams, Kevin A. Adams, Robert Schultz and
Bryce W. Calabria for Plaintiffs and Respondents.
___________________________________
Respondents Chen Feng and Zhong Cao (respondents) sued Blake
Sing Hon and LV Cheyenne LLC (Cheyenne) (collectively, appellants)
for breaching a settlement agreement. The settlement unambiguously
entitled respondents to 50 percent of Cheyenne’s assets other than a
commercial property in Nevada (property) minus Cheyenne’s known
obligations and loan liabilities, which totaled $8 million. However,
before the close of escrow, Cheyenne paid Hon a bonus, purportedly
under a 2007 Management Agreement (Management Agreement). The
trial court found on summary adjudication that Hon was not entitled to
the bonus under the settlement terms or the Management Agreement.
On de novo review, we affirm the judgment.
FACTS
Appellant Cheyenne owns commercial property in Nevada.
Respondents formed Cheyenne in 2007 with appellant Hon, who served
as company manager. Respondents and Hon each had a 50 percent
membership interest in Cheyenne.
In 2021, respondents sued Hon for breach of fiduciary duty. They
resolved their dispute with a Settlement Agreement in 2023. It
provides that Hon would “purchase Plaintiffs’ ownership interests in
LV Cheyenne.” This “result[ed] in Plaintiffs transferring to Hon their
complete and entire membership interests in LV Cheyenne, and the
continuation of LV Cheyenne’s legal existence.” Cheyenne agreed to
distribute to respondents half “of all assets of LV Cheyenne other than
the Property or ownership interest in it,” minus Cheyenne’s “ ‘Known
Obligations’ ” and loan liabilities. This amount was $8 million. The
court retained jurisdiction to enforce the Settlement Agreement.
As part of the settlement, the parties signed a Member Interest
Purchase Agreement (Purchase Agreement). It reiterates that
respondents will relinquish their interest in Cheyenne in return for a
distribution of 50 percent of Cheyenne’s assets. Hon represented that
his purchase was “solely for his own account for investment and not
with a view to or for sale or distribution of [respondents’] Interests.”
Days before the close of escrow, Hon announced he was entitled
to a “ ‘bonus’ ” of $805,899.56. Citing the Management Agreement, he
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deducted an “8% commission” from the final accounting, reducing
respondents’ distribution by $402,949,78. Under the Management
Agreement, the parties agreed to pay Hon annual bonuses for setting
up and managing Cheyenne, and an 8 percent bonus on the “net gain
from the sale of Cheyenne Industrial Center property.” It is
undisputed that Cheyenne still owns the property, following the
parties’ settlement.
Respondents sued for breach of contract, declaratory relief and
unjust enrichment. In a motion for summary judgment, respondents
argued that the Settlement and Purchase Agreements entitle them to
50 percent of Cheyenne’s assets. Respondents maintained that the
Management Agreement bonus clause was not triggered because
transferring membership interests between existing owners is not a
“sale” of the property. Respondents further argued that Hon breached
the settlement terms and was unjustly enriched by reducing their
distribution.
In opposition, appellants asserted that the Settlement Agreement
does not supersede the Management Agreement, which provides for a
bonus upon sale of the Cheyenne property. Appellants took the
position that Hon’s acquisition of respondents’ interest was, in fact, a
sale of the property. They wrote, “[T]his is a Property transaction
disguised as a membership transaction.” Appellants argued that
resolving whether the bonus provision was triggered requires
testimony and written evidence, precluding summary judgment.
The trial court summarily adjudicated the causes of action for
breach of the Settlement and Purchase Agreements and declaratory
relief. The court found that interpretation of a contract is a matter of
law for the court, and that “Hon’s purchase of [respondents’]
membership interest was not a sale of the Property or a ‘deemed sale of
the property.’ ” The court also found no evidence that there was ever a
“ ‘net gain’ ” from the sale, a requirement for the 8 percent commission
under the Management Agreement. Therefore, the court entered
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judgment for respondents for $402,949.78, plus interest, and awarded
them contractual attorney fees.1
This timely appeal followed.
DISCUSSION
The judgment is appealable. (Code Civ. Proc., §§ 437c, subd.
(m)(1), 904.1, subd. (a)(1).) A motion for summary judgment must be
granted if no triable issue of material fact exists and the moving party
is entitled to judgment as a matter of law. (Id., § 437c, subd. (c).) The
procedure enables courts to cut through the pleadings and determine if
trial is necessary. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th
826, 843.)
The goal of contract interpretation is to give effect to the mutual
intention of the parties at the time the contract is formed; intent is
inferred, if possible, solely from the contract language. (Civ. Code,
§ 1636; Coral Farms, L.P. v. Mahony (2021) 63 Cal.App.5th 719, 727.)
When a contract term is disputed, we first determine if it is ambiguous
or susceptible to the meanings urged by the parties. (Curry v. Moody
(1995) 40 Cal.App.4th 1547, 1552.) Parol evidence is admitted if
“relevant to prove a meaning to which the language is ‘reasonably
susceptible.’ ” (Winet v. Price (1992) 4 Cal.App.4th 1159, 1165.) No
ambiguity exists if a contract “is reasonably susceptible to only one
interpretation.” (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 987.)
“Our review is de novo where the evidence is undisputed.” (Ibid.)
On summary judgment, the parties may submit extrinsic
evidence to show the words of a contract are ambiguous or have a
special meaning. (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th
384, 390–391.) “Where the interpretation of contractual language
turns on a question of the credibility of conflicting extrinsic evidence,
interpretation of the language is not solely a judicial function.” (Morey
v. Vannucci (1998) 64 Cal.App.4th 904, 912–913.) In the absence of
1 The court denied summary adjudication of the issue whether
Hon was unjustly enriched because there is no cause of action for
unjust enrichment.
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conflicting extrinsic evidence, however, the court may resolve the
disputed issue. (Ibid.)
Here, Feng submitted a declaration explaining her intent at the
time of contracting, namely, that Hon would purchase respondents’ 50
percent ownership in Cheyenne in exchange for a 50 percent share of
its then-current liquid assets. Hon did not offer a declaration or
deposition testimony contradicting Feng. Nor do appellants offer any
precontractual communications in support of Cheyenne’s argument
that “everyone understood Hon was paying Respondents for their half
of a valuable real estate asset.” Instead, they rely on evidence of post-
contract communications between the parties. Contrary to appellants’
argument, an e-mail from counsel signaling plans to sue for breach of
the Settlement Agreement is not extrinsic evidence of intent.
Statements made after a dispute arises are inadmissible to show the
parties’ intent when they signed the contract. (Southern Cal. Edison
Co. v. Superior Court (1995) 37 Cal.App.4th 839, 851.)
Because there is no conflicting extrinsic evidence, interpretation
of the parties’ agreements presents a purely legal question that can be
resolved on summary judgment. We agree with the trial court because
none of the agreements between the parties supports a conclusion that
Hon is entitled to a bonus or commission.
First, the Settlement Agreement does not authorize payment of a
commission or bonus. It states respondents will receive a distribution
of 50 percent of all Cheyenne’s assets. No provision is made for a
bonus. If the parties intended to deduct almost a million dollars as a
bonus or commission for transferring respondents’ membership
interests, it had to be specified in the Settlement Agreement.
Second, the Purchase Agreement does not authorize payment of a
commission or bonus. It states that respondents’ share of debt to
lenders would be withheld from the distribution of assets. It does not
allow a bonus to be withheld.
The Purchase Agreement does state that at close of escrow,
Cheyenne “shall distribute to each of [respondents] his or her pro rata
share of all assets of the Company other than the Property or any
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ownership interest therein, which amount shall be reduced by and net
of each of the [respondents’] proportionate share of all Known
Obligations.” “ ‘Known Obligations’ ” are “those obligations of LV
Cheyenne that are identified in the financial statements . . . minus any
loan liabilities to Lenders.” Hon offered no evidence that his claimed
bonus or commission was a known obligation of Cheyenne.
Third, Hon has no right to a bonus under the Management
Agreement. It states Cheyenne would pay Hon a bonus on “net gain
from the sale of Cheyenne Industrial Center property.” Absent parol
evidence showing the parties gave special meaning to the words used,
we look to their ordinary meaning. (Civ. Code, § 1644.)
A “sale” is “the act of selling; specifically: the transfer of
ownership of and title to property from one person to another for a
price.” (www.merriam-webster.com [as of June 11, 2026], archived at
<https://perma.cc/86MG-JP6K>.) Respondents’ assignment of their
membership interests to Hon was not the “sale” of Cheyenne’s
“property.” The property was and is still owned by Cheyenne.
Cheyenne agrees, writing, “[N]o sale has taken place and the Property
continues to be owned by the Company.” Hon admits that he “did not
dispute the literal facts that the Property remain[s] titled in the
Company’s name and that the transaction was structured as a
membership interest transfer.”
In fact, the Settlement Agreement makes clear that the parties’
transaction did not involve a “sale” of the property. It states: “Rather
than purchase the entire property from LV Cheyenne, however, the
Parties agree Hon shall purchase Plaintiffs’ respective member
interests in LV Cheyenne on the terms set forth below, thus resulting
in Plaintiffs transferring to Hon their complete and entire membership
interests in LV Cheyenne, and the continuation of LV Cheyenne’s legal
existence.”
Cheyenne contends, “The parties could well have intended to
include any transaction whereby the owners monetize the Property’s
appreciation.” However, the plain language of the contract governs
when (as here) there is no extrinsic evidence of the parties’ intent.
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(Eminence Healthcare, Inc. v. Centuri Health Ventures, LLC (2022) 74
Cal.App.5th 869, 880.)
Finally, no bonus is authorized by the parties’ 2007 Addendum.
It gave Hon the right to cast the deciding vote in the event the parties
deadlocked on a proposal, and forbade members from selling an interest
in Cheyenne to a nonmember. If the parties disagreed whether to
accept an offer to sell Cheyenne’s real property, the member wishing to
keep the property had a right of first refusal to purchase the interests
of other members. Hon exercised his rights under the Addendum to
prevent respondents from selling the property.
To the contrary, the Addendum supports the conclusion that the
parties did not intend to pay Hon a bonus. The Addendum and
Management Agreement were entered concurrently yet make no
mention of paying Hon a bonus for purchasing respondents’
memberships. The parties did not include a sentence defining a buy-
out of member interests as a property “sale” triggering a bonus under
the Management Agreement. We cannot rewrite the parties’
Addendum to add bonus language to it.
In sum, the agreements are reasonably susceptible of only one
interpretation: The parties intended to pay Hon a bonus on the sale of
the Cheyenne property to a third party, if the sale generated a net gain.
The reason is plain. As manager, Hon would have to find a broker; list
the property; and negotiate the sale terms. Paying him a bonus for this
work—and for getting the best possible price from a third party to
increase net gain—makes sense. It makes no sense to pay Hon for
buying out existing members for his own benefit.
Cheyenne writes, “[T]he trial court left unanswered the question
of whether [Cheyenne] is required to pay a bonus to Hon.” This lawsuit
resolves one issue: Respondents’ right to a full distribution under the
Settlement and Purchase Agreements, i.e., to recover the $402,949.78
appellants withheld. We agree with the trial court that appellants are
jointly and severally liable for breaching the contracts. If Cheyenne
wanted the court to resolve its obligation to Hon, it had to cross-
complain against Hon. It failed to do so.
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DISPOSITION
The judgment is affirmed. Respondents are entitled to recover
their costs and attorney fees on appeal by bringing an appropriate
motion in the trial court.
NOT TO BE PUBLISHED.
GOORVITCH, J.
We concur:
CHAVEZ, Acting P. J.
RICHARDSON, J.
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