Rival Water Well Specialty v. Hua
Filed 4/9/12 Rival Water Well Specialty v. Hua CA4/3
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opinion has not been certified for publication or ordered published for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
FOURTH
APPELLATE DISTRICT
DIVISION
THREE
RIVAL WATER WELL SPECIALTY et.
al,
Plaintiffs and Appellants,
v.
THAN LONG HUA, as Trustee,
etc.,
Defendant and Appellant.
G043911
(Super. Ct. No. 30-2008-00105226)
O P I N I O N
Appeals from a judgment
of the Superior Court
of
County, David T. McEachen, Judge. Affirmed.
Mahaffey & Assoc.,
Douglas L. Mahaffey and Susan B. Ghormley for Plaintiffs and Appellants.
Viken K. Pakradouni for
Defendant and Appellant.
* * *
Defendant
Than Long Hua, as Trustee for the Hua Trust PT, appeals from a judgment in
favor of plaintiffs Rival Water Well Specialty (Specialty) and Rival Well Services,
Inc. (Services) in the sum of $112,052 for services performed to reabandon
(cap) a nonproducing oil well owned by defendant. He appeals on numerous grounds, many of which
challenge plaintiffs’ contractors licensing, including failure to allege or prove
a license and lack of a proper license.
He also claims he was not permitted to question a witness about
licensing and the court erred when it allowed addition of a second plaintiff
right before voir dire.
Plaintiffs appeal,
arguing the court erroneously denied their motion to amend the complaint to add
a cause of action for promissory fraud
to conform to proof.
Finding no error, we
affirm.
FACTS AND PROCEDURAL HISTORY
In 2007, Specialty was a
general partnership providing services necessary to abandon or reabandon
nonproducing oil wells. The relevant
principals were Bobby Grayson, Sr. (Senior), and his son, Bobby Grayson, Jr.
(Junior). In June 2007 Senior and Junior
formed Services, a corporation. The two
plaintiffs worked from the same office and used each other’s documents. Senior and Junior thought of Specialty and
Services as the same company.
In February 2007
Specialty sent a proposal to defendant to perform the work to reabandon
defendant’s well for an estimate cost of $66,550, which could go up or down,
depending on what was found once work commenced. Defendant agreed to have the work done within
a few weeks and the permit was issued in March.
Work began in October, after defendant removed a house located on the
property. The work was completed and
defendant was billed a total of $112,052, which he failed to pay.
Plaintiffs sued
defendant for breach of contract and on several common counts. The jury awarded plaintiffs the full amount
sought plus prejudgment interest. The
court denied defendant’s motions for nonsuit, judgment notwithstanding the
verdict (JNOV), and new trial.
Additional facts are set
out in the discussion.
DISCUSSION
Defendant’s Appeal
a. Challenges to Licensing
Failure to Allege Licensing in the Complaint
Business
and Professions Code section 7031, subdivision (a) (all further statutory
references are to this code unless otherwise stated) requires that a contractor
suing to recover money for services rendered must allege that it was licensed
“at all times during the performance of that act or
contract . . . .”
Defendant argues plaintiffs are barred from recovery because they did
not plead in the complaint that they were duly licensed. Although plaintiffs did not allege licensing,
the parties litigated the issue. Any
error in failing to allege the license does not make the judgment
reversible. (Jackson v. Pancake (1968) 266 Cal.App.2d 307, 312;
79, 87.)
Verified Certificate of Licensure
Section
7031, subdivision (d) declares that “[i]f licensure or proper licensure is
controverted, then proof of licensure . . . shall be made by
production of a verified certificate of licensure from the Contractors’ State
License Board which establishes that the individual or entity bringing the
action was duly licensed in the proper classification of contractors at all
times during the performance of any act or contract covered by the action.” The party challenging licensing is not
required to offer such a certificate; rather the burden of proof is on the
contractor. (Ibid.)
Plaintiffs
did not proffer certified copies of their licenses but instead obtained copies
of certificates from the licensing board, apparently from its website. Defendant stipulated those certificates,
along with several other documents, could be admitted as exhibits. The certificates showed Specialty held general
engineering (class A) and water well drilling (class C57) licenses as a partnership
from the period February 23, 1995
through February 28, 2009,
during the time the work was performed.
Services held a general engineering license from July 31, 2007 with an expiration date of July 31, 2011, also during the period
work was done.
After
plaintiffs rested, defendant made a motion for nonsuit on several grounds,
including failure to produce a certified copy of the licenses. The court denied the motion.
Defendant
argues that by failing to introduce certified copies of the licenses,
plaintiffs did not meet their burden of proof.
We are not persuaded.
“The
purpose of the licensing law is to protect the public from incompetence and
dishonesty in those who provide building and construction services. [Citation.]
The licensing requirements provide minimal 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.]”
(Hydrotech Systems, Ltd. v. Oasis
Waterpark (1991) 52 Cal.3d 988, 995; see Buzgheia v. Leasco Sierra Grove (1997) 60 Cal.App.4th 374, 391 [“it
is true the license requirement implicates the public policy to deter unlawful
contracting. But the mode of proof of a
license is not a matter implicating that public policy, it is a matter of
procedural convenience”], italics omitted.)
The
requirement of a verified certificate is an evidentiary requirement for
authenticating the document. By
stipulating to admit the two certificates plaintiffs produced, defendant, in
effect, agreed the documents were authentic.
The only reason to admit certificates of licensure is to prove licensing
during the relevant period; otherwise the documents would be irrelevant. The stipulation to admit the documents waived
the requirement for verified copies.
Defendant
maintains the certificates that were admitted do not necessarily contain the
same information that would be shown on a verified copy. But counsel at oral argument acknowledged he
had no idea what a verified copy would contain, having never seen one. Further, with the stipulation, defendant
waived this argument.
Defendant
argues he stipulated to admission only so he could question plaintiffs about
lack of proper licensing. But the record
does not reflect any limitation on his stipulation.
Based
on the stipulation, we need not address defendant’s claim plaintiffs were
required to submit instructions so the jury could find they were properly
licensed, eliminating our reliance on a jury finding of licensure.
Work Performed by Services Prior to Licensing
Defendant
asserts that, although Services was not licensed until July 2007, it did the
work, even though Specialty may have sent the invoices. Defendant lists several documents and points
to various testimony in support of the argument. Plaintiffs dispute it. There was conflicting evidence at trial. For example, the heading on the February 2007
proposal showed Rival Well Services.
Defendant argues this means Services made the proposal. But there was evidence in the form of a
declaration filed by Junior that Rival Well Services was a dba of Specialty
that had been adopted because Rival Water Well Specialty was “not a real good
sounding name to work in the oil fields.”
(Ball v. Steadfast-BLK (2011)
196 Cal.App.4th 694, 702 [statute does not bar recovery by contractor who uses
different name from that shown on license].)
Further, the license number shown on the proposal was Specialty’s.
Defendant
also argues Junior and Senior both testified Services performed the work. This is not exactly correct. During cross-examination defendant’s counsel
tried to have both of them admit Services, not Specialty, had done the
work. When asking Junior about who had
entered into the contract, Junior testified that “[a]ccording to the paperwork,
it says ‘Rival Well Services’” and “[a]pparently Rival Well Services.” But Junior denied Rival Well Services was the
“actual contractor.” And he later
testified the proposal did not bear the name Rival Well Services, Inc.
Senior
had gone to inspect the property in May or June 2007. When defendant’s lawyer asked which company
he was representing, Senior testified, “to me it didn’t really matter. But from your standpoint, probably Rival Well
Service rather that Rival Water Well.”
This could be considered damning or ambiguous.
But
the jury had the right to believe Specialty was the contractor and we do not
reweigh the evidence or determine credibility.
(Steele v. Youthful Offender
Parole Bd. (2008) 162 Cal.App.4th 1241, 1251-1252.) And we view the facts most favorably in
support of the jury’s verdict. (
Enterprises, Inc. (2011) 199 Cal.App.4th 1336, 1340.)
Defendant
argues plaintiffs performed some acts under the contract before Services was
licensed, including obtaining the permit and preparing a notice of intention to
abandon the well. But there was evidence
in the record, in the form of the invoice, that the first act performed was in
October 2007, after Services was licensed.
That there was contrary testimony, again, falls within the province of
the jury to decide. Further, the invoice
bears the name Specialty, which was licensed, making this argument
irrelevant.
Defendant
points to the judgment entered in favor of both plaintiffs, maintaining that
because Services performed work before it was licensed, it is not entitled to
recover. We have resolved that claim,
however. We also note that the total
judgment is $112,052 plus prejudgment interest and costs. The plaintiffs are not each entitled to
recover that amount.
4) Loss of Specialty’s Licensed
Partner
Section 7076,
subdivision (c) provides that a partnership’s license is “canceled upon the
disassociation of a general partner . . . .” Subdivision (b) states that the license is
canceled when a general partner dies. In
both instances the surviving general partner must apply for a new license. In the JNOV motion defendant raised for the
first time the argument Specialty’s license had been cancelled because a former
partner, Duard Loveless, had died in 2006.
On appeal, he broadens his argument, relying on Senior’s testimony that
he and Junior alone began operating Specialty in September 2006.
This argument does not
persuade. First, although Senior did
state Loveless had died, he gave no date.
The trial court may grant a motion for JNOV “‘only if it appears from
the evidence, viewed in the light most favorable to the party securing the
verdict, that there is no substantial evidence in support.’ [Citations.]”
(Wolf v. Walt Disney Pictures and
Television (2008) 162 Cal.App.4th 1107, 1138.) Any inferences are to be drawn in plaintiffs’
favor. (Hauter v. Zogarts (1975) 14 Cal.3d 104, 110.) Thus we cannot infer, as defendant would have
us, that Loveless died in 2006 based on Senior’s testimony about when he and
Junior became partners.
Over defendant’s
objection the trial court allowed plaintiffs to file a declaration in
opposition to the motion that stated Loveless died in 2008 and his license was
good until then. On appeal, defendant’s
only challenge to admission of this evidence was in a footnote, which we are
not required to consider. (People v.
Crosswhite (2002) 101 Cal.App.4th 494, 502, fn. 5.)
Moreover, the
certificate of license in evidence shows the partnership was licensed for the
entire period. Although this might be
considered a conflict in plaintiffs’ evidence, on a motion for JNOV such an
inconsistency does not defeat the judgment as long as there is sufficient
evidence supporting the judgment, as is the case here. (Hale
v. Farmers Ins. Exchange (1974) 42 Cal.App.3d 681, 692, disapproved on
another ground in Egan v. Mutual of Omaha
Ins. Co. (1979) 24 Cal.3d 809, 822, fn. 5.)
Requirement of Specialized License
Defendant maintains a
specialized license for drilling and oil field work was required and neither
plaintiff had it. “Limited specialty is
a specialty contractor classification limited to a field and scope of operations
of specialty contracting for which an applicant is qualified other than any of
the specialty contractor classifications listed and defined in this
article.” (Cal. Code Regs., tit. 16,
§ 832.61, subd. (a).) This argument
is flawed.
Under section 7056
pertaining to a general engineering contractor’s license, activities included
within the license include “pipelines and other systems for the transmission of
petroleum and other liquid or gaseous substances,” and “land leveling and
earthmoving projects . . . .” As shown by the certificates obtained from
the website, both plaintiffs had this Class A license.
Further,
defendant fails to cite to any regulation requiring or even discussing a D09
license. The record contains a document
defendant apparently retrieved from the Contractors State License Board
describing a drilling contractor. But
that document merely describes a “Classification”; it does not refer to a
specialized license.
In
addition, California Code of Regulations, title 16, section 830, subdivision (b),
on which defendant relies, only states that contractors shall be licensed as
Class A or Class B contractors and cannot contract outside either license. (See
Pacific Caisson & Shoring, Inc. v. Bernards Bros. Inc. (2011) 198
Cal.App.4th 681, 690 [contractor with Class A license not required to also have
specialty license]; Ron Yates
Construction Co. v. Superior Court (1986) 186 Cal.App.3d 337, 346, 348
[where contractor possessed Class A license, which requires “specialized
engineering knowledge and skill, including [specified subjects],” Class B
license not required].)
Joint Venture License
Defendant’s next claim
is that plaintiffs were required to obtain a joint venture license. He makes little argument, other than stating
the evidence reflects plaintiffs were “operating a joint venture” and section
7029.1 prohibits two licensed contractors being “awarded a contract jointly or
otherwise act[ing] as a contractor” unless they obtained a joint venture
license. This argument is not well
developed and could be considered waived.
(Nelson v. Avondale Homeowners
Assn. (2009) 172 Cal.App.4th 857, 862.)
In addition, the record is not as clear as defendant may think.
Defendant acknowledges
that section 7031, subdivision (a), which bars unlicensed contractors from
recovering sums due, does not apply to licensed contractors who fail to obtain
a joint venture license. He argues this
does not apply based on his claims that Services performed work prior to
licensing and that Specialty was unlicensed after Loveless left. We have disposed of these arguments.
Loaning of License; Aiding and Abetting Unlicensed Acts
Defendant claims that
even if we do not agree Specialty was licensed, it nevertheless is barred from
recovering because it “‘lent’” its license to Services. He relies on the proposal bearing the name
“Rival Well Services” that lists Specialty’s license number. But he disregards evidence that Rival Well
Services was a dba of Specialty.
Moreover he provides no authority that these acts, if proven, would
suffice to deny plaintiffs from recovering under the contract. (Badie
v. Bank of America (1998) 67 Cal.App.4th 779, 784-785.)
Effect of Licensing of Junior and Senior
Defendant maintains the
court relied on individual licenses of Junior and Senior to find plaintiffs had
the right to recover. There is no
evidence of that in the record reference he cites. Moreover, we do not rely on it in deciding
this appeal.
b. Evidentiary Ruling
Defendant complains the
court cut off questioning when his lawyer was trying to establish Services had
borrowed Specialty’s license as shown on the proposal. A review of the testimony shows defendant’s
lawyer asked several questions during cross-examination before the court
sustained an objection. The court did
not abuse its broad discretion to control questioning. (Schimmel
v. Levin (2011) 195 Cal.App.4th 81, 87.)
c. Leave to Amend Complaint
Defendant objects to the
court’s allowing Specialty to amend its complaint just before trial started to
add Services as a plaintiff. It was
done, he claims, apparently as a result of its motion in limine to exclude any
documents showing Services had done any of the work. This ruling was also within the discretion of
the trial judge. (Code Civ. Proc.,
§ 473, subd. (a)(1).) We do not
reverse a decision to allow such an amendment absent a showing of abuse of
discretion. (Foxborough v. Van Atta (1994) 26 Cal.App.4th 217, 230.) Defendant has not made such a showing.
Plaintiffs’ Appeal
A couple of days before
the case was sent to the jury plaintiffs filed a motion to amend the complaint
to conform to proof to add a cause of action for promissory fraud. At the close of testimony plaintiffs asked
for a ruling and the court denied it without explanation. Plaintiffs claim that was an abuse of
discretion.
The motion was based on
the testimony of defendant, who, plaintiffs claim, never intended to honor the
agreement. Plaintiffs dealt with
defendant’s brother, Josh Hua, as defendant’s agent when they entered into the
agreement to reabandon the well. In the
motion, they argued defendant concealed from Josh that he never intended to
perform the agreement. They assert they
did not know of defendant’s intent until he testified at trial.
The elements of promissory
fraud are a promise to do some act without the intent to perform to induce the
other party to rely, justifiable reliance, and damages. (Lazar
v. Superior Court (1996) 12 Cal.4th 631, 638.) Plaintiffs’ quote some of defendant’s trial
testimony as support for the cause of action.
But a review of the testimony shows that it does not plainly show
defendant’s intent not to perform is not as clear as plaintiffs make it out to
be.
Although the right to
amend is construed liberally (Rainer v.
Buena Community Memorial Hosp. (1971) 18 Cal.App.3d 240, 254), the decision
is left to the court’s discretion and we do not reverse without a strong
showing discretion was abused (Consolidated
World Investments, Inc. v. Lido Preferred Ltd. (1992) 9 Cal.App.4th 373,
383). Plaintiffs did not make a
sufficient showing of abuse of discretion.
DISPOSITION
The judgment is
affirmed. The parties shall bear their
own costs on appeal.
RYLAARSDAM,
ACTING P. J.
WE CONCUR:
ARONSON, J.
IKOLA, J.
