Hagopian v. Barron

Filed 12/4/08 Hagopian v. Barron CA2/5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 FIVE

APPEAL from a judgment of the Superior Court of Los Angeles County, R. Bruce Minto, Judge. Modified and Affirmed.

Ralph S. Greer for Plaintiffs and Appellant.

Law Offices of Mark A. Spraic, Mark A. Spraic; Mahoney & Soll and Paul M. Mahoney for Defendants and Appellants.

________________________________________

Plaintiffs Artour Hagopian, Diran Maloumian, and A.D. Truck Parking & Fuel LLC appeal from that portion of a judgment in favor of defendants Raymond Barron, Arrow Fuel Service, Inc., and the Barron Family Limited Partnership. On appeal, plaintiffs contend: 1) the terms of the parties contract were sufficiently certain to order specific performance; 2) the trial court erred by admitting expert testimony to interpret the contract; 3) Barrons contracting method was an unfair business practice; and 4) Hagopian and Maloumian were prevailing parties, because restitution of $25,000 was a net monetary recovery. We conclude the trial court did not abuse its discretion by denying specific performance, the admission of expert testimony did not cause any prejudice to plaintiffs, substantial evidence supports the trial courts finding that Barron did not commit an unfair business practice, and Hagopian and Maloumian were not the prevailing parties.

Defendants Raymond Barron, Arrow Fuel Service, Inc., and the Barron Family Limited Partnership appeal from the portion of the judgment ordering restitution of a $25,000 deposit to plaintiffs, with interest. We conclude there is no evidence to support the trial courts finding that defendants tender of plaintiffs deposit prior to the instant action was conditional. Therefore, the judgment must be modified to provide for replacement of the check, without prejudgment interest. As modified, we affirm.

FACTS

Barron and his sister own the Partnership, whose sole asset is a parcel of real property in Irwindale. Barron and his sister also own Arrow, which leases parking spaces for trucks and sells diesel fuel at the Irwindale property. Hagopian is a truck driver who parks his truck at Arrow. In December 2005, Hagopian expressed interest to Barron about buying the business. Barron told him that he would sell the business for $2 million. Barron was aware that Hagopian was often late with monthly payments, although his account was current. Hagopian discussed the investment opportunity with his friend Maloumian, who is a car mechanic.

In January, Barron gave Hagopian a document to review with Maloumian and make changes if there were any terms they didnt like. He told them that if they liked everything, they should sign it and return it to him. The document was entitled, Property owner; Barron Family Limited Partnership and subtitled, Business; Arrow Fuel Service, Inc. Eleven terms were listed as follows: 1. Location of property to be sold 1580 E. Arrow Highway, Irwindale, CA 91706, 2 acres consisting of underground storage tanks, capacity 12,00 gallons, two fuel dispensers. [] 2. Existing business Arrow Fuel Service, Inc., parking of diesel trucks and fuel sales. [] 3. Sale price 2 million dollars. [] 4. Down-payment $400,000.00, $25,000.00 of this amount will be a non-refundable deposit if buyer does not go with intentions. This amount will be applied toward down payment in escrow. [] 5. Seller will carry note of $1.6 million for a period of 25 years at 8.5 [percent], seller requires a balloon payment in 8 years of account balance, or has option to review account. Payment to be every 10th of each month, late charge of $50.00 daily will be applied to payment. After 30 days of non-payment there will be foreclosure on property, at buyers expense. [] 6. Seller requires certificate of liability insurance on property, and proof of property yearly tax payments. [] 7. Direct money transfer of payment to sellers bank account. [] 8. Buyer to pay surplus of diesel fuel in tank, at close of escrow. [] 9. Buyer to pay his part of escrow expenses. [] 10. Fuel tank passed yearly inspection. Buyer to assume all responsibility and liability of fuel tank, at close of escrow. [] 11. Miscellaneous equipment and parts to be included in sale, consist of the following: Clark forklift, Case skiploader, sweeper, five storage vans, miscellaneous truck parts, and shed used for office.

Hagopian reviewed and signed the document with Maloumian the same day, returned to Barrons office and handed it to him. Hagopian did not believe he was buying the business, its assets or stock, when he signed the document, only the real property with the tanks and some equipment. He expected Barron to open escrow to transfer the property to their newly formed business A.D. Truck. Barron gave the document to his attorney and was unable to produce it later.

On January 25, 2006, Hagopian wrote a check made out to Arrow in the amount of $25,000 with the notation down payment for A.D. Truck Parking and Fuel LLC. Hagopian gave the check to Barron, who gave the check to his sister to deposit. The check was stamped for deposit in Arrows account. He asked for Hagopian and Maloumians social security numbers so that he could run a credit check.

On January 27, 2006, articles of incorporation were filed for A.D. Truck with the California Secretary of State. Barron told Hagopian that he wanted to complete the transaction by the end of March and Hagopian would run the business beginning April 1, 2006. Hagopian paid a woman $2,300 per month for three months to put information in the computer, make new contracts for tenants to sign, and prepare receipts. A few of the tenants signed new contracts and gave deposits to Hagopian. On Barrons advice, Hagopian terminated some leases when he informed the tenants of the change in ownership.

Barron delayed completion of the transaction. From the time that Hagopian brought Maloumian to invest in the business, Barron felt they were untrustworthy. He had a gut feeling that Hagopian and Maloumian did not have the funds for the remainder of the down payment, so he waited things out.

Hagopian was anxious to move forward. Maloumians friend, real estate broker Tom Maple, advised Maloumian to prepare a more formal agreement, to supply missing items like signatures. On February 15, 2006, Hagopian delivered a letter of intent to Barron that was prepared by Maple and executed by Hagopian and Maloumian, to enter into an agreement for the purchase of the real property on Arrow Highway. In addition to the terms that had been listed by Barron, Maples letter added terms he thought would be beneficial, including requiring mutual execution of formal purchase agreements for the business and the real property, receipt of ownership and maintenance documents for the property and information pertaining to hazardous substances, a contingency period for Hagopian and Maloumian to inspect and cancel the sale, a provision for escrow to close within 60 days, and a provision allowing Hagopian and Maloumian to assign their right to purchase the property to relations or associates without Barrons consent. The letter stated that the parties would be legally bound only after execution of the purchase agreement.

Barron said he would give Maples document to his attorney. In March, Barron told Hagopian that he had changed his mind and did not want to finance the transaction. He gave Hagopian one week to find financing. Maloumian was able to get a loan confirmation letter from a loan broker. Barrons accountant provided three years of tax returns for the business. The broker believed he was arranging a bank loan to buy the real property and whatever was on the property. However, the loan officer who received the loan application from the broker believed Maloumian was purchasing the property and the business. In determining whether to provide funding, the loan officer relied substantially on the income of the business to calculate whether it could support the loan. The loan officer felt confident the loan would have been funded because the land value alone would have covered the amount of the loan.

The broker told Barron that the loan approval was contingent on an appraisal of the property and an inspection of the underground tanks during escrow. Barron gave his attorneys telephone number to the broker to coordinate opening escrow. The broker left several messages and spoke to the attorney once without making progress toward opening escrow. The broker reported to Barron that he was ready to move forward with the loan and escrow, but Barrons attorney was not responsive.

Barron suggested that the broker represent all of the parties and prepare an agreement. They discussed terms that Barron wanted in the agreement. The broker prepared a commercial property purchase and joint escrow instructions document that specifically stated Seller is not responsible for any environmental issues and Seller selling real property and business as-is. The broker gave the contract to Barron to review and said his fee to complete the transaction representing both buyer and seller would be $25,000. Barron took the contract. When nothing further happened, the broker concluded that he was wasting his time.

Barron changed his mind about selling the business. He decided the loan broker was a loan shark. He received a background check that he believed confirmed Hagopian and Maloumian were unsavory characters. He felt he had a moral responsibility to his tenants who parked at the yard not to turn the business or the yard over. And property values were continuing to climb.

Barron wrote a letter to A.D. Truck dated April 12, 2006, stating, This letter is to advise you that it has been decided not to proceed with negotiations for the sale of the referenced property to you. It has become apparent for a variety of reasons that this would not be appropriate. In this regard, you will find enclosed (my/the Partnerships) check in the amount of $25,000 which was originally delivered to me as a sign of good faith with respect to our discussions.

Barron provided a check dated April 17, 2006, in the amount of $25,000 to Hagopian. Barrons sister wrote a description on the carbon copy of the check voucher, which would be reviewed by their accountant, that it was the return of the deposit on the sale of the yard and there was no sale. On the advice of his lawyer, Hagopian did not cash the check. Hagopian gave the check to his lawyer, and as far as he knows, his lawyer has it. It has not been cashed.

PROCEDURAL BACKGROUND

On April 20, 2006, plaintiffs filed a complaint against defendants. In September 2006, plaintiffs filed the operative amended complaint for fraud, specific performance, breach of contract, declaratory relief, promissory estoppel, restitution, and unfair business practice in violation of Business and Professions Code section 17200 et seq. Plaintiffs dismissed the breach of contract cause of action prior to trial.

A trial to the court was held in September 2007. Barron moved for a directed verdict against A.D. Truck at the end of plaintiffs opening statement, which the trial court granted, because the entity was not in existence at the time the contract was entered into.

The trial court admitted testimony of expert witness Alan Wallace, who is an attorney specializing in real property law and a licensed real estate broker. The court overruled plaintiffs objections to Wallaces testimony as to legal conclusions. Wallace testified that a hypothetical unsigned agreement did not comply with the statute of frauds. Wallace also testified that the document prepared by Barron was not sufficiently definite, because a number of material terms were omitted or unclear, such that there was not a meeting of the minds. Wallace described several terms that were missing. The document did not name the parties to the contract with reasonable certainty. It did not specify the length of escrow or the termination date of the agreement. It does not specify the seller, whether it is the corporation or the limited partnership. It did not allocate the purchase price between the business and the real property, which would be critical for tax purposes. It did not specify whether they were buying the assets of the corporation of the stock, which could have a large impact on the buyers liability. If the buyer purchases the assets, he is generally insulated from liability from the business, but if the buyer purchases the stock, he may assume liabilities of the business. There is no due date for the down payment and no closing date for the transaction. Wallace also opined that payment of a $25,000 deposit was not sufficient partial performance to overcome the statute of frauds.

The trial court found that a contract was formed when Hagopian and Maloumian signed the document as directed by Barron and provided a check for the deposit. Barron intended to sell the property at the time the contract was formed. The court found that the statute of frauds was not a bar, because there had been partial performance through the payment of $25,000 and arrangements to finance the purchase, and the deposit of the check. Defendants breached the contract by canceling it and tendering a refund of $25,000, unequivocally expressing an intent not to proceed with the transaction, and unreasonably delaying performance. Barrons statements that he would not finance the transaction and his request that Hagopian and Maloumian obtain third party financing within a week were an offer to amend the contract, which Hagopian and Maloumian accepted. Hagopian and Maloumian showed that they were able and willing to perform at the time the contract was entered into and for a reasonable time thereafter through either defendants financing terms or obtaining a new loan. Hagopian and Maloumian did not show that they remained able to perform through the date of trial by obtaining financing, although they were able to perform with defendants financing. The court found that defendants are holding the $25,000 deposit and their offer to refund the deposit imposed conditions on acceptance that defendants were not entitled to impose. Therefore, it was not a legally valid tender and did not extinguish defendants obligation to refund the money. However, there was no evidence of lost opportunities or substantial detriment to Hagopian and Maloumian.

The trial court found that the contract was not sufficiently definite and certain to specifically enforce. The contract was for more than the sale of the real property, but the court could not determine whether the contract included the business, shares of a corporation, or assets. The items included in the subsequent letter of interest drafted by Maple were examples of the terms missing from the contract. The court also referred generally to the expert testimony. The court found that specific performance of the contract would require too much rewriting and supplying of terms by the court, and inserting the term reasonable for every addition would materially alter the terms of the contract.

The trial court found that the manner in which Barron entered into the transaction, including the endorsement of the check by a stamp and the absence of his signature on the contract, did not amount to an unfair business transaction because it was a single transaction, not within the normal business of any defendant, and simply sloppy legal work by unsophisticated laypersons.

The trial court found in favor of defendants as to fraud, specific performance, declaratory relief, and unfair business practice. The court found in favor of Hagopian and Maloumian as to promissory estoppel and restitution. The court ordered restitution of $25,000 to Hagopian and Maloumian, as well as interest from April 12, 2006, to the present. However, the court found Hagopian and Maloumian were not entitled to profits from the operation of Arrow or appreciation of the value of the property.

On October 31, 2007, the trial court entered a judgment in favor of defendants on the causes of action for fraud, specific performance, declaratory relief, and unfair business practice, and in favor of Hagopian and Maloumian on the causes of action for promissory estoppel and restitution. Notice of entry of judgment was mailed the same day. Plaintiffs filed a notice of appeal on December 13, 2008.

Defendants filed a motion to correct the judgment nunc pro tunc, because the trial court had omitted any disposition of the case as to A.D. Truck. After a hearing on January 3, 2008, the court granted the motion and ordered defendants to submit a corrected judgment. In addition, the court awarded defendants their costs as against A.D. Truck. The court found Hagopian and Maloumian prevailed as to 10 percent of what they had sought in the action, and therefore, the court awarded plaintiffs 10 percent of their claimed costs. The court found defendants prevailed as to 90 percent of the action and awarded defendants 90 percent of their claimed costs.

The trial court entered a corrected judgment in favor of defendants as against A.D. Truck and in favor of Hagopian and Maloumian as to promissory estoppel and restitution only. The judgment awarded defendants costs of $11,420.34 against A.D. Truck and costs of $9,719.11 as against Hagopian and Maloumian, which the court calculated by offsetting an award of $10,278.31 on defendants cost bill by an award of $559.20 on Hagopian and Maloumians cost bill. Defendants filed a notice of appeal.

DISCUSSION

Expert Testimony

Plaintiffs contend the trial court erred by admitting expert testimony on issues of law. We conclude the admission of expert testimony caused no prejudice to plaintiffs.

As a general rule, the opinion of an expert is admissible when it is [r]elated to a subject that is sufficiently beyond common experience that the opinion of an expert would assist the trier of fact . . . . (Evid. Code, 801, subd. (a).) Additionally, in California: Testimony in the form of an opinion that is otherwise admissible is not objectionable because it embraces the ultimate issue to be decided by the trier of fact. (Evid. Code,  805.) However, the admissibility of opinion evidence that embraces an ultimate issue in a case does not bestow upon an expert carte blanche to express any opinion he or she wishes. [Citation.] There are limits to expert testimony, not the least of which is the prohibition against admission of an expert's opinion on a question of law. (Summers v. A. L. Gilbert Co. (1999) 69 Cal.App.4th 1155, 1178.)

[T]he calling of lawyers as expert witnesses to give opinions as to the application of the law to particular facts usurps the duty of the trial court to instruct the jury on the law as applicable to the facts, and results in no more than a modern day trial by oath in which the side producing the greater number of lawyers able to opine in their favor wins. [Citation.] [Citation.] (Summers v. A. L. Gilbert Co., supra, 69 Cal.App.4th at p. 1179.)

A trial courts determination that expert testimony is admissible is reviewed for an abuse of discretion. [Citations.] (Summers v. A. L. Gilbert Co., supra, 69 Cal.App.4th at p. 1168.) Even if the court erred by allowing Wallace to testify on issues of law and give opinions on how the case should ultimately be resolved, plaintiffs have the burden of demonstrating they were prejudiced by the error. (People v. Watson (1956) 46 Cal.2d 818, 836.)

In this case, the trier of fact was the court. There was no danger that Wallaces opinions would usurp the trial courts authority to declare the applicable law. Moreover, plaintiffs have not shown that they were prejudiced by the admission of any specific testimony. They contend Wallaces testimony that the $25,000 deposit was not sufficient partial performance to avoid the statute of frauds was incorrect, but it is clear that the court disregarded Wallaces testimony on this issue. No prejudice to plaintiffs has been shown.

Specific Performance

Plaintiffs contend the contract terms were sufficiently certain to order specific performance. We conclude the trial court did not abuse its discretion in determining that the contract was not susceptible to specific performance.

To obtain specific performance after a breach of contract, a plaintiff must generally show: (1) the inadequacy of his legal remedy; (2) an underlying contract that is both reasonable and supported by adequate consideration; (3) the existence of a mutuality of remedies; (4) contractual terms which are sufficiently definite to enable the court to know what it is to enforce; and (5) a substantial similarity of the requested performance to that promised in the contract. [Citations.] [Citations.] (Real Estate Analytics, LLC v. Vallas (2008) 160 Cal.App.4th 463, 472.)

The parties outward manifestations must show that the parties all agreed upon the same thing in the same sense. (Civ. Code, 1580.) If there is no evidence establishing a manifestation of assent to the same thing by both parties, then there is no mutual consent to contract and no contract formation. (Civ. Code, 1550, 1565 & 1580.) [] In order for acceptance of a proposal to result in the formation of a contract, the proposal must be sufficiently definite, or must call for such definite terms in the acceptance, that the performance promised is reasonably certain. (1 Witkin, Summary of Cal. Law [(9th ed. 1987)] Contracts,  145, p. 169.) A proposal cannot be accepted so as to form a contract unless the terms of the contract are reasonably certain. [] . . . The terms of a contract are reasonably certain if they provide a basis for determining the existence of a breach and for giving an appropriate remedy. (Ibid., quoting from Rest.2d Contracts, 33.) If, by contrast, a supposed contract does not provide a basis for determining what obligations the parties have agreed to, and hence does not make possible a determination of whether those agreed obligations have been breached, there is no contract. [Citations.] In particular . . . a provision that some matter shall be settled by future agreement, has often caused a promise to be too indefinite for enforcement. [Citation.] (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 811-812.)

[A] greater amount or degree of certainty is required in the terms of an agreement which is to be specifically executed in equity than is necessary in a contract which is the basis of an action at law for damages. [Citations.] (Pascoe v. Morrison (1933) 219 Cal. 54, 58.)

We review the interpretation of a written instrument de novo, unless the interpretation turns upon the credibility of extrinsic evidence. (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865.) However, [a] grant or denial of specific performance is reviewed under an abuse of discretion standard. [Citation.] (Real Estate Analytics, LLC v. Vallas, supra, 160 Cal.App.4th at p. 472.) [T]he trial court is vested with certain discretion in determining whether specific performance should or should not be granted under the facts of any particular case. As was said in Lind v. Baker [(1941)] 48 Cal.App.2d 234, at page 245, The enforcement of a contract by a decree of specific performance rests in the sound discretion of the court, a judicial discretion to be exercised in accordance with established principles of equity with reference to the facts of the particular case. The contract may be valid in law and not subject to cancellation in equity and yet the terms thereof and the attendant circumstances may be such as to require the court to deny its specific performance. (Mills v. Skaggs (1944) 64 Cal.App.2d 656, 660-661.)

In this case, the trial court did not abuse its discretion in concluding that the contract should not be specifically enforced based on the uncertainty of the contract terms. The purchase agreement stated that it included the existing Arrow business, yet there was no meeting of the minds as to what that term meant. Hagopian believed he was purchasing the real property with fuel tanks and certain equipment of the business only, but those items were expressly referred to in other provisions of the contract, and the contract clearly provided for the purchase of the existing Arrow business. It is uncertain from the evidence whether this term referred to the entire Arrow Corporation or some portion of the business, including the corporate stock, potential obligations and liabilities, the customer data, the goodwill of the business, or other physical assets. The court found the missing terms could not be implied without materially altering the parties agreement. The courts exercise of its discretion to conclude that the purchase agreement was too uncertain for specific performance was not arbitrary or capricious.

Unfair Business Practice

Plaintiffs contend the trial court should have found Barrons method of contracting was an unfair business practice. We disagree.

The UCL [(Californias Unfair Competition Law)] does not proscribe specific activities, but broadly prohibits any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising. ( 17200.) The UCL governs anti-competitive business practices as well as injuries to consumers, and has as a major purpose the preservation of fair business competition. [Citations.] By proscribing any unlawful business practice, section 17200 borrows violations of other laws and treats them as unlawful practices that the unfair competition law makes independently actionable. (Cel-Tech Communications, Inc. v. Los Angeles Cellular Telephone Co. (1999) 20 Cal.4th 163, 180 (Cel-Tech).) Because . . . section 17200 is written in the disjunctive, it establishes three varieties of unfair competition-acts or practices which are unlawful, or unfair, or fraudulent. In other words, a practice is prohibited as unfair or deceptive even if not unlawful and vice versa. (Ibid.) (Puentes v. Wells Fargo Home Mortgage, Inc. (2008) 160 Cal.App.4th 638, 643-644.)

A business practice is unfair within the meaning of the UCL if it violates established public policy or if it is immoral, unethical, oppressive or unscrupulous and causes injury to consumers which outweighs its benefits. [Citations.] The determination whether a business practice is unfair involves an examination of [that practices] impact on its alleged victim, balanced against the reasons, justifications and motives of the alleged wrongdoer. In brief, the court must weigh the utility of the defendants conduct against the gravity of the harm to the alleged victim . . . . [Citations.] [Citation.] [Citation.] (McKell v. Washington Mutual, Inc. (2006) 142 Cal.App.4th 1457, 1473.)

What constitutes an unfair or fraudulentbusiness practice is a question of fact, with the essential test being whether the public is likely to be deceived . . . . [Citation.] (People v. McKale (1979) 25 Cal.3d 626, 635.) (Daro v. Superior Court (2007) 151 Cal.App.4th 1079, 1099, fn. 9.) Whether a practice is deceptive, fraudulent, or unfair is generally a question of fact which requires consideration and weighing of evidence from both sides[.] [Citations.] (Linear Technology Corp. v. Applied Materials, Inc. (2007) 152 Cal.App.4th 115, 134-135.)

There is substantial evidence to support the trial courts finding that the manner in which Barron entered into the contract was not an unfair business practice. Neither Barron nor Hagopian were sophisticated businesspersons. When they received the contract terms from Barron, Hagopian and Maloumian could have suggested more specific terms instead of signing the contract and providing the deposit. The courts determination that the manner of contracting was simply sloppy, unsophisticated legal work by laypersons, rather than an unfair business practice, is supported by the parties backgrounds and the courts finding that Barron intended to sell the property at the time the contract was formed.

Restitution and Promissory Estoppel

Defendants contend they validly tendered the return of plaintiffs deposit. Therefore, plaintiffs are not entitled to recover $25,000 with interest from April 12, 2006, based on their causes of action for restitution and promissory estoppel. We agree.

Defendants sent a check to plaintiffs in the amount of $25,000 and purported to cancel the contract. There were no conditions attached to acceptance of the check. Plaintiffs had defendants check throughout the duration of the lawsuit. Apparently, plaintiffs lawyer has lost the check, or it is no longer negotiable due to the passage of time. There was no evidence that plaintiffs requested, or that defendants refused to provide, a replacement for the lost check. Plaintiffs are not entitled to restitution of $25,000, with interest, when they already hold a check from defendants for $25,000. However, in the interests of justice, the judgment should be modified to deny relief to plaintiffs on the causes of action for promissory estoppels and restitution of the deposit, and to order Barron to arrange for a stop payment on the check for $25,000 that is in plaintiffs possession and for Arrow to issue a new check for $25,000 to plaintiffs.

Prevailing Parties

Hagopian and Maloumian contend they are the prevailing parties and as such are entitled to recover the entirety of their costs, because the award of $25,000 on the causes of action for promissory estoppel and restitution was a net monetary recovery. We disagree.

Code of Civil Procedure section 1032, subdivision (b), provides that a prevailing party is entitled as a matter of right to recover costs in any action or proceeding, unless another statute expressly provides otherwise. As used in section 1032: Prevailing party includes the party with a net monetary recovery, a defendant in whose favor a dismissal is entered, a defendant where neither plaintiff nor defendant obtains any relief, and a defendant as against those plaintiffs who do not recover any relief against that defendant. When any party recovers other than monetary relief and in situations other than as specified, the prevailing party shall be as determined by the court, and under those circumstances, the court, in its discretion, may allow costs or not and, if allowed may apportion costs between the parties on the same or adverse sides pursuant to rules adopted under Section 1034.

Generally, when a party falls squarely within one of the four situations enumerated in the definition of a prevailing party under section 1032, that party is entitled to recover costs as a matter of right. (Great Western Bank v. Converse Consultants, Inc. (1997) 58 Cal.App.4th 609, 612-614; Crib Retaining Walls, Inc. v. NBS/Lowry, Inc. (1996) 47 Cal.App.4th 886, 889-891.) It is clear from the statutory language that when there is a party with a net monetary recovery (one of the four categories of prevailing party), that party is entitled to costs as a matter of right; the trial court has no discretion to order each party to bear his or her own costs. [Citation.] In other circumstances, the trial court exercises its discretion to determine the prevailing party, comparing the relief sought with that obtained, along with the parties litigation objectives as disclosed by their pleadings, briefs, and other such sources. [Citation.] (Chinn v. KMR Property Management (2008) 166 Cal.App.4th 175, 187-188.)

As modified, Hagopian and Maloumian have not recovered on any cause of action and do not have a net monetary recovery. The check they received prior to initiating legal proceedings will be replaced with a check for the same amount. Defendants have not appealed from the portion of the judgment awarding costs. Therefore, we will not disturb the trial courts ruling on the issue of costs.

DISPOSITION

The judgment is modified to (1) enter judgment in favor of defendants on the causes of action for promissory estoppel and restitution; and (2) order Arrow to stop payment on the $25,000 check, dated April 17, 2006, and to issue a new check to Artour Hagopian in the amount of $25,000. Defendants Raymond Barron, Arrow Fuel Service, Inc., and the Barron Family Limited Partnership are awarded their costs on appeal.

KRIEGLER, J.

I concur:

ARMSTRONG, Acting P. J.

MOSK, J., Concurring,

I concur.

The trial court concluded that the contract was not sufficiently definite and certain to enforce. The trial court did not exercise its discretion to deny enforcement of the contract. Whether a contract is sufficiently definite to enforce is an issue of law (Ladas v. CaliforniaState Auto. Assn. (1993) 19 Cal.App.4th 761, 770, fn. 2; Ersa Grae Corp. v. Flour Corp. (1991) 1 Cal.App.4th 613, 623) that we review de novo. I agree with the trial courts determination.

MOSK, J.

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