Warehouse Development v. Kelton
Filed 4/20/06 Warehouse Development v. Kelton CA5
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT
| WAREHOUSE DEVELOPMENT COMPANY et al., Plaintiffs and Respondents, v. MICHAEL KELTON et al., Defendants and Appellants. |
F045448
(Super. Ct. No. CV16751)
O P I N I O N
|
APPEAL from a judgment of the Superior Court of Madera County. Edward P. Moffat II, Judge.
Wild, Carter & Tipton and Steven E. Paganetti for Defendants and Appellants.
Motschiedler, Michaelides & Wishon and Russell K. Ryan for Plaintiffs and Respondents.
oo0oo
In conjunction with forming a partnership for the purpose of developing industrial warehouses, appellants, Michael Kelton and Kelton & Associates, Inc. (collectively Kelton), and respondents, Peter T. Stravinski and Peter T. Stravinski & Associates, Inc. (collectively Stravinski), each agreed to not build, develop and operate a warehouse without including the other. Based on alleged violations of this covenant, Kelton sought damages from Stravinski. In response, Stravinski and the remaining respondents, entities that have interests in the subject warehouse projects and in which Stravinski has an ownership interest,[1] filed a complaint seeking a declaration that the covenant not to compete was invalid. Kelton thereafter filed a cross-complaint for damages.
The trial court determined that the covenant not to compete violated Business and Professions Code[2] section 16600 and was therefore unenforceable as a matter of law. Accordingly, the trial court entered judgment in favor of respondents on the complaint. Finding that all of Kelton's causes of action against Stravinski in the cross-complaint were premised on the covenant not to compete, the trial court entered judgment for Stravinski. The court first granted summary adjudication on two causes of action in Stravinski's favor and thereafter sustained Stravinski's demurrer without leave to amend on the remaining causes of action. This appeal is limited to the grant of summary judgment on the complaint.
Kelton contends the covenant not to compete was enforceable because Kelton and Stravinski were involved in an ongoing business relationship. Kelton further argues that even if the covenant is illegal, it should be enforced to prevent Stravinski from being unjustly enriched.
As discussed below, the trial court was correct. Accordingly, the judgment will be affirmed.
BACKGROUND
By an agreement dated May 5, 1992, Stravinski and Kelton formed a general partnership called Warehouse Development Company for the purpose of developing industrial warehouses. Each particular piece of property to be acquired and developed was to be designated by a project statement that would constitute an amendment to the partnership agreement. The parties further agreed that, notwithstanding the existence of this agreement, each partner could â€
