City of Anaheim v. Angels Baseball, L.P.

Filed 12/19/08 City of Anaheim v. Angels Baseball, L.P.

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FOURTH APPELLATE DISTRICT

DIVISION THREE

Appeal from a judgment and order of the Superior Court of Orange County, Peter J. Polos, Judge. Affirmed.

Rutan & Tucker, Michael Rubin, Todd Litfin; Sheppard, Mullin, Richter & Hampton, Sean P. OConnor, Jeffrey Blank; City of Anaheim and Jack White, City Attorney, for Plaintiff and Appellant.

Luce, Forward, Hamilton & Scripps, George J. Stephan; Buchalter Nemer, Robert M. Dato, Efrat M. Cogan, Harry W.R. Chamberlain; Powell Goldstein, William Shearer, William V. Custer; Theodora Oringher Miller & Richman and Todd C. Theodora for Defendant and Appellant.

* * *

Plaintiff City of Anaheim (Anaheim) and Disney Baseball Enterprises, Inc. (Disney), entered into a stadium lease agreement in connection with Disneys purchase of the California Angels major league baseball team. Section 11(f) of the lease required Disney to change the team name to include the name Anaheim therein. Shortly after executing the lease, Disney renamed the team the Anaheim Angels.

Seven years later, Disney sold the team to defendant Angels Baseball, L.P. (ABLP). In early 2005, ABLP changed the teams name to the Los Angeles Angels of Anaheim. Anaheim sued, alleging the name change and ABLPs systematic removal of the name Anaheim from the teams road jerseys, tickets, merchandise, and souvenirs breached the team name provision of the lease and the implied covenant of good faith and fair dealing. After a lengthy trial, the jury rejected Anaheims claims and returned a verdict in ABLPs favor.

Anaheim contends it was deprived of a fair trial because the trial court improperly (a) allowed Larry Murphy, the Disney official in charge of the negotiations with Anaheim, to testify about his subjective unexpressed intent concerning section 11(f) of the lease; (b) failed to give a number of jury instructions supporting Anaheims theory of the case; (c) excluded the testimony of Anaheims outside counsel regarding the meaning and intent behind various lease provisions; and (d) admitted the testimony of an undesignated expert witness.

In its separate appeal, ABLP challenges the trial courts order denying it prevailing party attorney fees under an indemnity provision in the lease. ABLP contends the doctrine of judicial estoppel bars Anaheims assertion the lease provision did not authorize attorney fees because Anaheim earlier had taken the opposite position when it had successfully opposed ABLPs pretrial motion to strike Anaheims attorney fee prayer in its complaint.

We conclude Anaheim has not met its burden of affirmatively demonstrating error and therefore no basis exists to overturn the jurys decision in this case. The trial court did not err in allowing Murphy to testify that he sought maximum flexibility for Disney in drafting the teams name provision because Disney anticipated the need to add a second geographical designation to compensate for Anaheims small market base. Murphy explained he pursued this strategy because flexible naming rights also would make it easier for Disney to attract potential buyers who would want the option of changing the team name. Murphys testimony about his unexpressed intent became relevant when Anaheim introduced evidence no one from Disney contemplated two geographic designations in the team name. Accordingly, Murphys testimony constituted admissible rebuttal evidence.

We also conclude the trial court did not err in rejecting Anaheims special instructions. Specifically, Anaheims special instruction No. 5 on unexpressed subjective intent incorrectly directed the jury not to consider ABLPs rebuttal evidence that Disney did not share the same unexpressed intent concerning the team naming provision. Anaheims special instruction No. 1 unfairly favored Anaheims evidence by specifically directing the jury to consider the custom and practice of Major League Baseball and was potentially confusing in its declaration that the lease was ambiguous. Anaheims special instruction No. 3 was ambiguous because the instructions reference to a promise failed to specify whether it referred to the promise forming section 11(f) or an unenforceable oral promise Disney made in the negotiations concerning the team name. The instruction also was misleading because it failed to inform the jury an objectively reasonable standard applied in evaluating the promisees understanding of the agreement. Anaheim based its eighth special instruction on Civil Code section 1069, which requires interpreting a lease in favor of the public entity granting a leasehold to a private party. Civil Code section 1069 does not apply here, however, because Anaheim had no preexisting naming rights to the team. Rather, section 11(f)s team name provision did not affect Anaheims leasehold interest and merely formed part of the consideration for the agreement. The trial court also properly rejected Anaheims special instruction Nos. 4 and 12, and Anaheims clarifying instruction to ABLPs special instruction No. 26, as either cumulative or argumentative.

We also discern no error in excluding the testimony of Anaheims outside attorney because Anaheim failed to provide an adequate offer of proof. Finally, we reject Anaheims contention the trial court erred in allowing the testimony of an undesignated expert witness. As we explain below, the witness did not testify as an expert.

Turning to ABLPs appeal, we conclude the trial court did not abuse its discretion in declining to apply the judicial estoppel doctrine, and that substantial evidence supports its finding the parties did not intend the leases indemnification provision to cover prevailing party attorney fees. Accordingly, we affirm the judgment and the trial court order denying ABLP attorney fees.

I

Factual and Procedural Background

In 1960, Major League Baseball chartered a new American League team for Southern California and, until 1966, the team played under the name Los Angeles Angels. In 1966, the team was renamed the California Angels, and moved from Los Angeles to Anaheim. In 1996, Disney, on behalf of the Walt Disney Company, agreed to purchase the team from owner Gene Autry contingent on renegotiating the existing stadium lease with Anaheim. The existing lease was to expire in 2001.

Lease negotiations between Disney and Anaheim began in 1995, and continued into 1996. Murphy, Disneys executive vice president and chief strategic officer, negotiated for Disney. Although Murphys face-to-face involvement was largely limited to the first third of the negotiations, Murphy lead the Disney negotiating team, and had oversight of the terms and conditions of the agreement. Also negotiating for Disney was Antonio Tavares, president of Disney Baseball Enterprises, who reported to Murphy. Sandy Litvack, Disneys general counsel and chief of corporate operations, also conducted negotiations for Disney. Lowell Martindale of OMelveny & Meyers provided Disney with legal representation.

Anaheims negotiating team included James Ruth, city manager, David Morgan, assistant city manager, Gregory Smith, contract administrator, and William Sweeney, chief financial officer. Thomas Daly, Anaheims mayor, also participated in the negotiations, and signed the lease on Anaheims behalf. City Attorney Jack White and outside counsel Jill Draffin of McDermott Will & Emery handled Anaheims legal representation.

Disney and Anaheim reached agreement and executed the Amended and Restated Lease Agreement on May 15, 1996. The lease required renovation of the stadium at an estimated cost of $100 million, with Anaheim contributing $20 million in cash and approximately $10 million in revenues from outdoor advertising signs on the stadium premises. Disney assumed responsibility for the remainder of the renovation expenses.

The preexecution drafts of the proposed lease included a name provision in section 11(f), which provided: Tenant will change the name of the Team to include the name Anaheim therein, such change to be effective no later than the commencement of the 1997 Season. Late in the negotiations, Anaheims representatives proposed the following change to section 11(f): Tenant will change the name of the Team to Anaheim Angels . . . . Disney rejected this proposal, and the original wording of the provision remained in the final version.

The lease included a marketing provision, section 22(c), which provides: Subject to the provisions of Sections 22(a) and 41(u), nothing in this lease is intended to or shall be deemed to require Tenant to adopt any marketing, licensing, sales, pricing or operating policies or procedures which Tenant, in its sole discretion, does not elect to adopt. The lease also included an integration clause, section 41(h), which provides, in part: This Lease shall constitute the entire agreement of the parties hereto with respect to the subject matter hereof.

After purchasing the team, Disney promptly named the team the Anaheim Angels. In 2003, ABLP purchased the team for approximately $180 million and began a marketing plan aimed at promoting the Angels as a major market team. As part of this effort, ABLP renamed the team the Los Angeles Angels of Anaheim, effective January 2005. Consistent with the new major market strategy, ABLP began eliminating Anaheim from team road jerseys, tickets, merchandise, and souvenirs.

Anaheim promptly filed suit against ABLP seeking injunctive and declaratory relief, and damages for breach of the lease and the implied covenant of good faith and fair dealing. Anaheim alleged the change in the team name from Anaheim Angels to Los Angeles Angels of Anaheim violated section 11(f) of the lease and the covenant of good faith and fair dealing because it deprived Anaheim of the national and international prominence it received from being the sole geographic identifier in the name of a major league baseball team. Anaheim also alleged ABLPs systematic elimination of Anaheim from association with the team as part of ABLPs marketing and branding plan violated section 11(f) and the covenant of good faith and fair dealing. Anaheim sought damages, injunctive and declaratory relief, and attorney fees pursuant to Section 36(a) of the 1996 Lease Agreement.

The trial court denied Anaheims request for a preliminary injunction seeking to require ABLP to change the team name back to the Anaheim Angels because Anaheim failed to demonstrate a reasonable likelihood of success on the merits. Anaheim filed a writ petition challenging the trial courts ruling. We denied the petition in an unpublished decision, determining that substantial evidence supported the trial courts action.

The case proceeded to trial, and the jury returned special verdicts finding ABLP did not breach section 11(f) of the lease, and did not breach the covenant of good faith and fair dealing. The trial court then denied Anaheims request for a permanent injunction, and denied ABLPs request for prevailing party attorney fees. Anaheim appeals the judgment, and ABLP appeals the trial courts order denying attorney fees.

II

Standard of Review

The law governing our review of Anaheims appeal prohibits us from deciding how we would have resolved the factual issues raised at trial had we sat as the trier of fact. Our constitutional role as a reviewing court is not to substitute our view of the evidence for the jurys, but to determine whether Anaheim has carried its burden to demonstrate reversible error. A judgment or order of a lower court is presumed to be correct on appeal, and all intendments and presumptions are indulged in favor of its correctness. (In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1133.) The burden of affirmatively demonstrating error is on the appellant. This is a general principle of appellate practice as well as an ingredient of the constitutional doctrine of reversible error. (Fundamental Investment Etc. Realty Fund v. Gradow (1994) 28 Cal.App.4th 966, 971.)

Anaheim challenges the trial courts admission of evidence on Disneys intent in negotiating section 11(f), and its exclusion of the testimony of Anaheims attorney concerning aspects of the negotiations. We review these evidentiary rulings for abuse of discretion. (City of Ripon v. Sweetin (2002) 100 Cal.App.4th 887, 899.) The test for the abuse of discretion standard is whether the trial courts ruling exceeded the bounds of reason. (Walker v. Superior Court (1991) 53 Cal.3d 257, 272.) Even if the appellant presented a strong argument at trial for a ruling in its favor, we must reject the appellants attack if the trial courts discretionary call did not stray beyond reasonable parameters. An appellate tribunal is neither authorized nor warranted in substituting its judgment for the judgment of the trial judge. [Citations.] In the absence of a clear showing that its decision was arbitrary or irrational, a trial court should be presumed to have acted to achieve legitimate objectives and, accordingly, its discretionary determinations ought not [to] be set aside on review. [Citation.] (Ajaxo Inc. v. E*Trade Group, Inc. (2005) 135 Cal.App.4th 21, 45.) We will not reverse a judgment based on the trial courts improper admission or exclusion of evidence unless the error results in a miscarriage of justice. (Travelers Casualty & Surety Co. v. Employers Ins. of Wausau (2005) 130 Cal.App.4th 99, 117.) In civil cases, a miscarriage of justice should be declared only when the reviewing court, after an examination of the entire cause, including the evidence, is of the opinion that it is reasonably probable that a result more favorable to the appealing party would have been reached in the absence of the error. (Huffman v. Interstate Brands Corp. (2004) 121 Cal.App.4th 679, 692.)

Anaheim also challenges the trial courts refusal to give several of their special instructions. To prevail, the appellant must show the omitted instructions correctly state the applicable law. (Null v. City of Los Angeles (1988) 206 Cal.App.3d 1528, 1534.) Even if the proposed instruction correctly states the law in the abstract, the trial court may reject the instruction if it is not supported by the evidence or is likely to mislead the jury. (Joyce v. Simi Valley Unified School Dist. (2003) 110 Cal.App.4th 292, 302.) In a civil case, each of the parties must propose complete and comprehensive instructions in accordance with his theory of the litigation; if the parties do not do so, the court has no duty to instruct on its own motion. [Citations.] [Citation.] Neither a trial court nor a reviewing court in a civil action is obligated to seek out theories plaintiff might have advanced, or to articulate for him that which he has left unspoken. (Finn v. G. D. Searle & Co. (1984) 35 Cal.3d 691, 701-702.)

[T]here is no rule of automatic reversal or inherent prejudice applicable to any category of civil instructional error, whether of commission or omission. A judgment may not be reversed for instructional error in a civil case unless, after an examination of the entire cause, including the evidence, the court shall be of the opinion that the error complained of has resulted in a miscarriage of justice. (Soule v. General Motors Corp. (1994) 8 Cal.4th 548, 580.) In making this determination, we must evaluate the state of the evidence, the effect of the other instructions, counsels arguments, and any jury questions. (Id. at pp. 580-581.) With these principles in mind, we begin our analysis.

III

Discussion

A. The Trial Court Did Not Abuse Its Discretion in Allowing Murphy to Testify About His Unexpressed Intent

At trial, Murphy testified that during lease negotiations, he intended for Disney to have maximum flexibility concerning the team name. He was particularly concerned that limiting the geographic identifier in the team name to only Anaheim might stymie the growth of the franchise because Anaheim was such a small market. Murphy anticipated a future need to incorporate an additional identifier, such as California, Orange County, or Los Angeles, in the team name. Murphy also anticipated that flexibility in the leases name provision would make it easier for Disney to attract potential buyers who would value the ability to change the team name. As Murphy explained, section 11(f) was intended to provide any future team buyer as much flexibility as they could possibly have to put whatever name they wanted on the team. Murphy testified he could not recall whether he specifically discussed the potential need for an additional geographic identifier with any of the Anaheim negotiators.

California recognizes the objective theory of contracts [citation], under which [i]t is the objective intent, as evidenced by the words of the contract, rather than the subjective intent of one of the parties, that controls interpretation [citation]. The parties undisclosed intent or understanding is irrelevant to contract interpretation. (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 956 (Founding Members).) Anaheim contends the trial court erred in allowing Murphy to testify regarding his undisclosed subjective intent that section 11(f) would reserve for Disney the right to add a second geographic identifier to the team name. In response, ABLP argues Anaheim placed the parties subjective unexpressed intent in issue, opening the door to Murphys rebuttal evidence. We agree with ABLP.

One of Anaheims arguments at trial was that using two geographic identifiers in the team name was absurd, and something that no one, including Disney, contemplated at the time the parties executed the contract. For example, in its opening statement, Anaheim remarked: Obviously no one at Disney and certainly no one at Anaheim ever thought there could ever be any possibility of Anaheims chief rival being included in the name of the team. Later in its opening, Anaheim noted: Its true Anaheim Angels may have been crossed out, but only for the limited purposes that everybody understood. And certainly not for a purpose that no one ever talked about, and certainly wasnt contemplated by Disney, the purpose that you could put two home designations into a team name.(Italics added.)

Anaheims first witness, Morgan, emphasized throughout his testimony the notion that no one ever thought about two geographic identifiers. Asked on direct examination about section 11(f)s lack of specificity, Morgan responded: Its because there would only be one home designation. There wouldnt be a sponsor. It would be Anaheim. And, you know, Anaheim was the home designation. We werent going to compete with a sponsor. And no one ever thought of two geographic identifiers. I mean, thats nonsense. . . . (Italics added.) Asked later on direct examination if he recalled discussions about custom and usage being changed to allow two geographic identifiers, Morgan responded, That never was discussed. I dont believe anybody even thought of that.

On redirect, when asked if the parties agreed to a variation of custom and usage, Morgan responded: The city and Disney both agreed to accept a variation, a deviation from custom and practice on naming of professional teams in a very narrow fashion that the home designation could come after the team mascot. No one ever talked, no one ever imagined two home designations. [] One of the things thats interesting about this case is that both the original parties dont dispute that. None of us even imagined this. (Italics added.) The trial court then granted ABLPs motion to strike Morgans comment that no one ever imagined using two geographic identifiers. A short time later during his redirect, Anaheim asked Morgan to clarify a previous answer about Anaheims attempt to preclude two geographical identifiers by proposing to change section 11(f) to require the name Anaheim Angels. Morgan responded: [W]hats important to understand is thats not what . . . was asked for, because no one anticipated, no one thought about two geographic identifiers. (Italics added.) This time, the trial court overruled ABLPs motion to strike.

After Morgans redirect concluded, ABLP requested a brief recross solely to address the no one thought of it issue. The trial court refused to allow further questioning of the witness on this issue, noting, if you bring additional evidence in that someone knew, then obviously his testimony was incorrect. But Im not going to go over what everyone else knew with him. Anaheim agreed with the courts approach.

In addition to Morgans testimony, Anaheim elicited similar testimony from Tavares, as follows: Q. [reading from declaration] Never did we contemplate that the team would include another geographic name in addition to Anaheim, as this would be inconsistent with the purpose of 11[f] to give Anaheim prominence and closely identify Anaheim with the team so that Anaheim would be publicized when the baseball team was publicized. Is that a true statement? [] [A.] Yes. [] Q. Paragraph 13 on page 4 reads, Given the importance of identifying Anaheim with the baseball team, it was never contemplated or suggested by anyone that there would be a second geographic name added to the team. Is that a true statement? [] [A.] Yes. (Italics added.)

Similarly, Anaheim asked Sandy Litvack, Disneys chief of operations and general counsel the following: Q. I take it then that nobody at Disney discussed having more than one geographic name in the name of the baseball team? [] A. Not with me. Absolutely not. [] Q. As far as you know, nobody at Disney contemplated that possibility in 1996? [] A. Not that I ever knew. (Italics added.)

A party who inadvertently refers to an irrelevant matter does not automatically open the gates (People v. Steele (2002) 27 Cal.4th 1230, 1273 (Steele)) and allow an opponent to introduce irrelevant evidence on the same subject. (See id. at p. 1248 [a party should not be allowed to take advantage of an obvious mistake to introduce prejudicial evidence].) But when a party intentionally elicits irrelevant evidence that prejudices an opposing party, and an objection or motion to strike cannot cure the prejudice, the trial court has discretion to allow the opposing party to present evidence in rebuttal. (Id. at pp. 1248-1249; 3 Witkin, Cal. Evidence (4th ed. 2000) Presentation at Trial, 352, pp. 439-440.) The courts discretion in whether to admit such rebuttal evidence is governed by the doctrine of fair play. (Travis v. Southern Pacific Co. (1962) 210 Cal.App.2d 410, 421. As Steele explains, the trial court should strive to prevent unfairness to either side when one side presents evidence on a point, then tries to prevent the other side from responding. (Steele, at p. 1248.)

Given Anaheim emphasized the issue twice during opening statement, and successfully elicited testimony from three key witnesses that no one had thought about the possibility of two geographic identifiers in the team name, we cannot conclude Anaheim introduced the issue by accident; indeed, the issue played a key role in Anaheims trial theme.^[1] Moreover, Murphys rebuttal testimony addressed specifically the issue Anaheim raised, and did not expand its scope. Under these circumstances, we cannot say the trial courts decision to admit Murphys rebuttal testimony violated the doctrine of fair play.

During oral argument on its appeal, Anaheim asserted Murphys testimony was not introduced as rebuttal evidence. How the parties described the evidentiary theory supporting Murphys testimony is not determinative. The relevance of Murphys account surfaced only after Anaheim had introduced the testimony of Morgan and Litvack that no one at Disney had thought of two geographic identifiers in the team name. Simply put, this constitutes rebuttal evidence. (See Edgar v. Workmens Comp. App. Bd. (1966) 246 Cal.App.2d 660, 665 [Rebuttal evidence is generally defined as evidence addressed to the evidence produced by the opposite party and does not include mere cumulative evidence of the plaintiffs case in chief].)

B. The Trial Court Did Not Err in Refusing Anaheims Proposed Jury Instructions

1. Anaheims Special Instruction No. 5 Covering Unexpressed Subjective Intent

Anaheim contends the trial court compounded its error in allowing Murphys testimony by refusing to give its special instruction No. 5, which provided: Evidence of a persons subjective intent that was not expressed to the other party during negotiation of the Lease agreement cannot be considered in determining the meaning of Section 11(f) of the lease if that persons subjective unexpressed intent contradicts the other partys understanding of Section 11(f) of the lease.

Anaheim now asserts it was entitled to an instruction telling the jurors they could not consider the parties unexpressed subjective intent in resolving the meaning of section 11(f). Anaheims special instruction, however, does not recite that legal concept. Rather, the instruction proscribes consideration of the parties subjective unexpressed intent only if such intent contradicts the other partys understanding. The instruction therefore incorporates two legal principles. The first portion of the instruction, preceding the word if, correctly articulates the general rule that [t]he parties undisclosed intent or understanding is irrelevant to contract interpretation. (Founding Members, supra, 109 Cal.App.4th at p. 956.) The second portion of the instruction incorporates an exception to that general rule: One party may introduce evidence of an opponents unexpressed intent if it is consistent with the first partys intent. (Heston v. Farmers Ins. Group (1984) 160 Cal.App.3d 402, 415 (Heston) [plaintiff allowed to introduce defendants brief filed in previous action that demonstrated defendants interpretation of a disputed contract term coincided with the plaintiffs interpretation].)

Anaheim introduced testimony from Morgan, Tavares, and Litvack that no one at Disney had contemplated the use of two geographic identifiers in the team name before the lease was signed. Because evidence of Disneys subjective mental processes supported Anaheims interpretation of section 11(f), it fell within the exception applied in Heston and, assuming Heston correctly stated the law, Anaheim would have been entitled to have the jury consider it. By the same token, however, the circumstances here, as discussed post, entitled ABLP to have the jury consider any contrary evidence ABLP offered in rebuttal.

Anaheim arguably would have been entitled to an instruction that the parties unexpressed subjective intent was irrelevant in determining the meaning of section 11(f) unless the jury found the parties shared the same unexpressed intent or understanding. While Anaheims proposed instruction authorized the jury to consider Anaheims evidence of a shared intent between it and Disney, the instruction erroneously directed the jury to disregard ABLPs rebuttal evidence. The trial court therefore correctly rejected Anaheims special instruction.

During oral argument, Anaheim characterized its proposed instruction as a limiting instruction. It is axiomatic, however, that a limiting instruction should inform the jury of the limited purpose for which a particular piece of evidence may be considered. Anaheims instruction essentially told the jury that Murphys testimony cannot be considered in determining the meaning of section 11(f) of the lease . . . . Because Anaheim did not request an instruction limiting the jurys consideration of Murphys testimony to rebutting Anaheims evidence of a shared mutual intent, the trial court was not required to give such an instruction. (See Barajas v. USA Petroleum Corp. (1986) 184 Cal.App.3d 974, 990 [trial court has no sua sponte duty to give limiting instructions].)

2. Anaheims Special Instruction No. 1 on Section 11(f)s Ambiguity

Anaheims special instruction No. 1 provided: The Court has determined that Section 11(f) of the lease is ambiguous. In interpreting Section 11(f) of the lease, you may consider things that are not written in the lease. Among other things, you may consider evidence of the intent of the parties to the lease, the custom and usage concerning names of major league baseball teams, and the subsequent conduct of the parties to the lease. The trial court rejected the proffered instruction as a misleading statement of the law. We agree with the trial court.

As Anaheim concedes, the trial court properly instructed the jury it could consider evidence of the parties intent, custom and usage, and the parties subsequent conduct. In that sense, the proffered instruction is merely cumulative of the courts other instructions. This reason alone adequately supports the trial courts rejection of the instruction. Anaheims proposed instruction, however, adds two additional improper elements to the mix.

First, the instructions reference to custom and usage specifically mentions major league baseball. True, the Angels are part of major league baseball, but they are also part of the larger group that comprises all of professional baseball. Although a team name incorporating two geographic identifiers did not fit the custom and usage of major league baseball, Anaheims expert conceded it fit well within custom and usage of minor league baseball, which is a part of professional baseball. By singling out major league baseball, the instruction unfairly favors Anaheims evidence. (Estate of Mann (1986) 184 Cal.App.3d 593, 611 (Mann) [instructions should avoid singling out and bringing into prominence before the jury certain isolated facts and thereby, in effect, intimating to the jury that special consideration should be given to those facts].)

Second, the instruction includes an irrelevant, potentially misleading judicial declaration that section 11(f) is ambiguous. An ambiguity arises when language is reasonably susceptible of more than one application to material facts. There cannot be an ambiguity per se, i.e., an ambiguity unrelated to an application. (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 391.) The question whether a contract term is reasonably susceptible to more than one meaning is a question of law for the court. (Founding Members, supra, 109 Cal.App.4th at p. 955.) The court undertakes a preliminary consideration of all credible evidence offered to prove the intention of the parties. [Fn. omitted.] [Citations.] . . . [Citations.] If the court decides, after considering this evidence, that the language of a contract, in the light of all the circumstances, is fairly susceptible of either one of the two interpretations contended for . . . [citations], extrinsic evidence relevant to prove either of such meanings is admissible. [Fn. omitted.] (Pacific Gas & E. Co. v. G. W. Thomas Drayage Etc. Co. (1968) 69 Cal.2d 33, 39-40.)

Because the jury has no role in the foregoing process, telling jurors a contract is ambiguous does nothing to assist them in performing their task, and may cause them to improperly disregard the contract terms entirely. Anaheim cites no authority requiring a trial court to inform the jury a contract is ambiguous, and we are unaware of any such requirement. Consequently, we discern no error in the trial courts refusal to give Anaheims special instruction No. 1.

3. Anaheims Clarifying Instruction on Integrated Agreements

The trial court gave ABLPs special instruction No. 26, defining an integrated agreement, which provided: Terms set forth in a writing intended by the parties as the final expression of their agreement with respect to such terms as are included may not be contradicted by evidence of any prior oral agreement or contemporaneous oral agreement. Anaheim does not take issue with this instruction, but contends the trial court erred by failing to give Anaheims clarifying instruction: Evidence of a prior or contemporaneous oral agreement that does not contradict the final written agreement may be considered to interpret ambiguous terms in the final written agreement as expressions of the parties intent.

We conclude the trial court did not err in refusing Anaheims proposed clarifying instruction for two reasons. First, it was unnecessary because the gist of Anaheims instruction is implied as the negative pregnant of the integration instruction given, and is otherwise covered by the courts general instruction that the jury may consider . . . the circumstances surrounding the making of the contract. Second, by highlighting the parties oral agreements, the requested clarification suggests the jury must give them special prominence among the various circumstances surrounding the execution of the lease. As noted above, jury instructions should avoid singling out facts supporting one sides case because it may influence the jury to give those facts special prominence. (See Mann, supra, 184 Cal.App.3d at p. 611].) Moreover, specifically instructing the jury to consider oral agreements might have misled the jurors into incorporating the parties oral agreements into the ambiguous lease term. As we discuss post, ABLP agreed to be bound by the written terms of the lease, not any oral agreements between Disney and Anaheim.

4. Anaheims Special Instruction No. 3, Based on Civil Code Section 1649

(a) The Proposed Instruction Is Ambiguous

Civil Code section 1649 provides: If the terms of a promise are in any respect ambiguous or uncertain, it must be interpreted in the sense in which the promisor believed, at the time of making it, that the promisee understood it. Based on this statute, Anaheim proposed special instruction No. 3, which read: The terms of Section 11(f) of the lease must be interpreted based on the promisors (Disney) belief of how the promisee (the City) understood the promise at the time the promise was made. Anaheim contends the trial court erred in refusing to give the instruction because it tracked Civil Code section 1649. We disagree.

The flaw in Anaheims instruction becomes apparent when considered in context. During lease negotiations Disney and Anaheim shared the common goal of promoting Anaheim as a tourist and convention destination. Increased tourism to Anaheim benefitted not only the city, but also meant an increase in potential customers for Disneyland, Disneys proposed second gate (i.e., California Adventure), and Disneys Mighty Ducks hockey team. Disneys willingness to promote Anaheim was evident in its decision to name the team the Anaheim Angels, include the citys name on its road jerseys, and imprint an Anaheim logo on the Angels team items, even though not expressly required by the lease.

The evidence demonstrated, however, Disney had another goal, not shared by Anaheim, to ensure flexibility in the team name as an inducement to a potential future purchaser of the team and thereby achieve maximum return from the sale. On this subject, Murphy testified: [U]ltimately we didnt know how things were going to work out. In any deal you try to have an exit strategy. We had to at least know that the team would be a fungible asset, saleable to a third party at some point. And we felt that any future owner would want the flexibility as much flexibility as they could possibly have to put whatever name they wanted on the team. Ruth similarly testified: My understanding was that they [Disney] needed more flexibility because . . . they had not agreed on a final name yet, and he wasnt sure whether it was going to be the Anaheim Angels, the Angels of Anaheim, and they wanted flexibility to eventually if they decided to sell the team to the new owner, a new proposer might want to change the mascot. That was my understanding. (Italics added.)

Disneys goal of promoting Anaheim as a tourist destination provided Disney an incentive to orally promise Anaheim prominence in the team name, but Disneys goal of flexibility for a new team owner provided Disney an incentive to exclude the promise from the written lease. In other words, Disney had an incentive to promise and deliver to Anaheim more than it was willing to hardwire into the lease. The tension between what Disney promised to give Anaheim and what it was willing to put in the contract is evident in the testimony of Anaheims mayor, Tom Daly, and Anaheims City Manager, James Ruth.

During his videotaped deposition, which was played to the jury, Daly testified he was generally cognizant of rare situations in professional sports where teams used two geographic identifiers, and it was one of the considerations in mind when he discussed the issue with Sandy Litvack. Daly testified, I recall asking Mr. Litva[c]k in particular for his assurances that Anaheim would be included in the team name as the only geographic reference, and I recall asking whether he could he was speaking for the company on the subject. [] And he said yes to both questions. Daly testified he therefore believed there was an agreement with Disney that Anaheim would be included in the team name as the only geographic reference in the team name[.] At trial, ABLP read Dalys deposition testimony that he believed there was an agreement with Disney that Anaheim would be the only geographic reference in the team name. When asked if this testimony was correct, Daly answered: Yes. I stand by that.

Anaheims city manager, James Ruth, testified in essence that the lease required Disney to name the team Anaheim Angels despite undisputed evidence Disney rejected Anaheims proposed express language in section 11(f) to that effect. Specifically, Ruth testified: Q. Based on your understanding of the contract, is Mighty Angels of Anaheim an acceptable name? [] A. In my opinion, no. [] Q. Why not? A.  Because thats not what we agreed to. [] Q. Okay. And when you say not what you agreed to, you mean you and Tony Tavares? A. Thats correct.

Ruth explained he dropped his insistence on an express provision in section 11(f) limiting the team name to Anaheim Angels because of an oral promise from Disney, as follows: Q. If you chose, you could have caused your attorneys to provide more specific language with respect to what you agreed to in paragraph 11(f); correct? [] A. Thats possible. [] Q.  And is it your testimony that you made a choice not to do that? A.  I made a choice based on integrity when somebody says we have a deal and we agree to the interpretation of the intent behind that statement, and we shake hands on it, or we agree to it verbally, thats integrity, and I think Tony I knew exactly what his intent was, and he knew what my intent was, and we both agreed to that. [] Ive got to give him the flexibility he needs to make it happen.

Ruth later testified that, at most under the lease, Disney could reverse the placement of the mascot and city in the team name, or change the name of the mascot altogether. But Ruth acknowledged he did not instruct his attorneys to change the lease to reflect this limitation, as follows: [You] could have added the words to changed the name of the team to the Anaheim Angels or Angels of Anaheim or changed the mascot, could have done that, but you did not do that because you knew that Disney would not sign the contract with those words in it; yes? True? [] A. Yes to that.

A fair reading of Ruths testimony suggests the parties did not memorialize agreed upon specific limitations to the team name because (a) Disney demanded maximum flexibility in the written leases name provision, and (b) Anaheim accepted Disneys oral promise it would limit the team name to certain variations. But ABLP, as Disneys successor to the lease, is not bound by Disneys oral promises to Anaheim, but only by the leases written terms. In light of Dalys and Ruths testimony that Disney made an oral promise, the proposed instruction is confusing and potentially misleading.

Specifically, the proposed instruction read: The terms of Section 11(f) of the lease must be interpreted based on the promisors (Disney) belief of how the promisee (the City) understood the promise at the time the promise was made. The special instruction fails to inform jurors the promise refers to Section 11(f) and not to any separate and unenforceable oral promises Disney made to Daly and Ruth. There is little place for elegant variation^[2]in jury instructions, and the instructions use of two different terms, Section 11(f) and promise, in the same sentence suggests they carry different meanings.^[3]

Anaheim could have avoided this particular problem with the instruction by using more precise language, illustrated in the following example: The terms of Section 11(f) of the lease must be interpreted based on Disneys belief of how Anaheim understood these terms at the time the lease was executed. This would focus the jury on the parties understanding of the written lease terms, and not on verbal promises made during lease negotiations. Anaheims proposed instruction failed to avoid this ambiguity.^[4]

(b) The Proposed Instruction Fails to Inform the Jury an Objectively Reasonable Standard Applies

Even if Anaheim had avoided the ambiguity above, however, the instruction would have been incomplete, despite accurately tracking the language of Civil Code section 1649. An instruction in the language of a statute is proper only if the jury would have no difficulty in understanding the statute without guidance from the court. [Citations.] . . . [Citation.] (Torres v. Parkhouse Tire Service, Inc. (2001) 26 Cal.4th 995, 1004 (Torres).)

For example, in Torres, the plaintiff sought to invoke the exception to workers compensation exclusivity in Labor Code section 3601, subdivision (a)(1), [w]hen the injury or death is proximately caused by the willful and unprovoked physical act of aggression of the other employee. The trial court instructed the jury that for the plaintiff to recover, they had to find (1) the plaintiffs injury was caused by a willful and unprovoked physical act of aggression on the part of [the coworker], and (2) [the coworker] committed the act with the intent to cause injury. (Torres, supra, 26 Cal.4th at p. 1000.) The California Supreme Court rejected the plaintiffs claim the trial court erred in adding to the instruction an intent to cause injury requirement not found in the words of the statute. The Supreme Court concluded the trial courts jury instruction properly added to the statutory language the additional requirement of an intent to cause injury because this was implicit in the language of the statute. (Id. at pp. 1005-1006.)

Merely restating Civil Code section 1649 as a jury instruction may lead to error. For example, in Wolf v. Superior Court (2004) 114 Cal.App.4th 1343, the promisor argued Civil Code section 1649 required the court to interpret a contract term in accord with its own subjective belief of how the promisee understood it. Although the literal language of Civil Code section 1649 would have required interpretation in this manner, the appellate court in Wolf rejected this argument, noting the section was designed to protect the promisees objectively reasonable expectations. (Wolf, at p. 1357, fn. 18, italics added.) Despite the lack of evidence concerning the contract negotiations, the appellate court overturned summary adjudication for the promisor because expert testimony of custom and usage created a triable issue of fact regarding the parties objectively reasonable expectations regarding the scope of the term when they agreed to the contract . . . . (Id. at p. 1360.)

The California Supreme Court recognized this requirement in the insurance context, observing that Section 1649 protects the objectively reasonable expectations of the insured. (Bank of the West v. Superior Court (1992) 2 Cal.4th 1254, 1265.) Similarly, in Medical Operations Management, Inc. v. National Health Laboratories, Inc. (1986) 176 Cal.App.3d 886, 893, the court recognized the task under Civil Code section 1649 was to determine consistent with the objective standard of contract interpretation [citations] how a reasonable promisor in [the promisors] shoes would have believed [the promisee] understood [the promisors] responsibilities under the disputed term.

That a party may not rely on its own objectively unreasonable understanding of a contract term, even if communicated to the other party, is recognized in the Restatement, Second of Contracts, section 201(2), which provides: Where the parties have attached different meanings to a promise or agreement or a term thereof, it is interpreted in accordance with the meaning attached by one of them if at the time the agreement was made [] (a)  that party did not know of any different meaning attached by the other, and the other knew the meaning attached by the first party; or [] (b)  that party had no reason to know of any different meaning attached by the other, and the other had reason to know the meaning attached by the first party. (Italics added.) In other words, a party cannot rely on its own understanding of a contract term where that party knew or had reason to know the other side repudiated that understanding before signing the contract.

As noted above, Ruth testified he understood, based on an oral agreement with Disney, that section 11(f) required Disney to name the team Anaheim Angels. Given the undisputed fact that Disney rejected express language in section 11(f) naming the team the Anaheim Angels before the contract was signed, the jury could reasonably conclude Ruths understanding of the contract term was objectively unreasonable. As written, however, the proffered instruction would erroneously require the jury to interpret section 11(f) in accord with Ruths understanding. Instead of protecting the parties objectively reasonable expectations at the time they entered into the lease, a jury instruction consisting of the bare language of section 1649 would defeat it.

It is unclear why the trial court rejected the special instruction. But ABLP objected to it in part because the instruction failed to articulate the objective[ly] reasonable belief standard. Anaheim responded to this objection by asserting the instruction was right out of the Civil Code . . . . Although a jury instruction simply reciting Civil Code section 1649 may be appropriate in situations where no evidence had been presented demonstrating the promisees understanding had been repudiated or was otherwise unreasonable, the requested instruction here was incomplete for failing to inform the jury it must determine whether Anaheims understanding of section 11(f) was objectively reasonable.^[5] The law imposes no duty on the trial court to correct or rewrite a partys confusing or incomplete proposed instruction. (See Bullock v. Philip Morris USA, Inc. (2008) 159 Cal.App.4th 655, 694.) Accordingly, we conclude the trial court did not err in refusing to give Anaheims special instruction No. 3.

The dissent mistakenly transposes principles governing the implied covenant of good faith and fair dealing to the separate concept of contract interpretation under Civil Code section 1649. In doing so, the dissent disregards any issue regarding the objective reasonableness of Anaheims understanding, and focuses on the purported unreasonableness of ABLPs interpretation of section 11(f). In its apples to oranges comparison, the dissent goes so far as to suggest that our opinion, if published, would do great violence to the law of bad faith. (At p. 10, post.) Not so. We emphasize the issue of the covenant of good faith and fair dealing presents a separate issue from Civil Code section 1649, one that Anaheim did not raise in its appeal.

Even assuming the relevance of the issue, however, the dissent fails to demonstrate error. Citing Third Story Music, Inc. v. Waits (1995) 41 Cal.App.4th 798, 806, the dissent states the principle underlying the covenant of good faith and fair dealing: When a contract provides that one party has discretion in performing a term of a contract, the law requires that party to use its discretion in good faith, and not in such a way as to deprive the other party of its benefits under the contract. (At pp. 7-8, post.) According to the dissent, the covenant would prevent ABLP from depriving Anaheim of a bargained-for benefit under the lease, even if ABLP did not breach the leases express terms.

But the trial court fully and properly instructed on this issue, which undoubtedly explains why Anaheim did not raise the issue on appeal. The trial court gave the following instruction: In every contract or agreement there is an implied promise of good faith and fair dealing. This means that each party will not do anything to unfairly interfere with the right of any other party to receive the benefits of the contract; however, the implied promise of good faith and fair dealing cannot create obligations that are inconsistent with the terms the contract. [] City of Anaheim claims that Angels Baseball, L.P. violated the duty to act fairly and in good faith. To establish this claim, City of Anaheim must prove the following two elements that are at dispute in this case: [] 1. That Angels Baseball, L.P. unfairly interfered with City of Anaheims right to receive the benefits of the contract; and [] 2. That City of Anaheim was harmed by Angels Baseball, L.P.s conduct, as I otherwise instruct you.

Significantly, the trial court followed up: Aparty breaches the implied covenant of good faith and fair dealing if it subjectively lacks belief in the validity of its acts or its conduct is objectively unreasonable. (Italics added.) Anaheim does not complain about either of these two instructions. In sum, the court gave the jury complete and accurate instructions on the implied covenant of good faith and fair dealing. The reality is the jury rejected Anaheims argument that ABLPs conduct was objectively unreasonable and breached the implied covenant. No legal basis therefore exists to overturn the jurys decision on this issue.

5. Anaheims Special Instruction No. 4 on the Relevance of the Parties Precontract Discussions

Anaheim submitted two versions of special instruction No. 4. The first read: Statements made by the parties (Disney and the City) to each other during negotiations are relevant in determining the parties understanding of Section 11(f) of the lease. Anaheim also submitted a revised special instruction No. 4, which provides: Statements made by the parties to each other during negotiations can be considered in determining the parties intent.

Anaheim contends its special instruction is necessary to counter ABLPs reliance on the leases integration agreement. We disagree. The trial court instructed the jury they may consider . . . the circumstances surrounding the making of the contract in interpreting the lease. Certainly, the discussions and negotiations between the parties are part of these circumstances. Because the instruction given by the court adequately covered the subject, we conclude the trial court did not err in failing to give either version of special instruction No. 4. (See People v. Hovarter (2008) 44 Cal.4th 983, 1022.)

6. Anaheims Special Instruction No. 12, on Specific Provisions Controlling a General Provision

Anaheims special instruction No. 12 provided: Contracts must be interpreted in a manner that gives force and effect to every provision, and not in a way which renders some clauses meaningless. When specific and general provisions of an agreement are inconsistent, the specific provision controls the general one. Anaheim contends the trial courts failure to give its requested instruction prevented it from arguing that section 11(f) was more specific than the marketing provision of section 22(c), and therefore must control.

We perceive no inconsistency between sections 11(f) and 22(c) justifying use of the requested instruction. Moreover, as the trial court noted, it is unclear which provision is more specific, as they cover different subjects. To the extent the evidence allowed Anaheim to argue section 11(f) limits the discretion conferred on the lessee in section 22(c), CACI No. 317 adequately addressed the issue, which, as read to the jury, provides: In deciding what the words of a contract meant to the parties, you should consider the whole contract, not just isolated parts. You should use each part to help you interpret the others, so that all the parts make sense when taken together.

7. Anaheims Special Instruction No. 8, Based on Civil Code Section 1069

Anaheims proposed special instruction No. 8 read: Every grant by a public body to a private party is to be interpreted in favor of the grantor. A lease is a grant. Anaheim contends the trial court erred in failing to give this instruction because the section requiresinterpretation in favor of the public entity even if there were substantial evidence to support ABLPs interpretation. (Original italics.) Anaheim contends the section therefore mandates that judgment be entered that ABLP breached Section 11(f) and the covenant of good faith and fair dealing. We disagree.

As a general rule, [a]ll contracts, whether public or private, are to be interpreted by the same rules, except as otherwise provided by this Code. (Civ. Code,  1635.) One exception to this general rule is found in Civil Code section 1069, which provides: A grant is to be interpreted in favor of the grantee, except that a reservation in any grant, and every grant by a public officer or body, as such, to a private party, is to be interpreted in favor of the grantor.

Anaheims proffered instruction incorporates Civil Code 1069, but includes the statement: A lease is a grant. Implicit in this statement and underlying Anaheims argument is the assumption that every term in a lease agreement is a grant. But the authority Anaheim cites for this proposition does not support it. Specifically, Upton v. Tosh (1940) 36 Cal.App.2d 679, 686, recognized that Civil Code section 1069 applied to the termination clause in a lease because the clause constituted a reservation in the interest granted. Nothing in Upton suggested Civil Code section1069 would apply to every term of a lease with a public agency.

Anaheim also cites Red Mountain, LLC v. Fallbrook Public Utility Dist. (2006) 143 Cal.App.4th 333 (Red Mountain).) In Red Mountain, the court considered an agreement calling for a government entity to grant an easement to a private party. The court recognized Civil Code section 1069 did not apply to all of the contract terms, but used the statute to construe an ambiguous clause in the public entitys favor because the ambiguity concerns the nature and scope of the easement to be granted. (Red Mountain, supra, 143 Cal.App.4th at p. 345.) In reaching this conclusion, the Red Mountain court considered Civil Code section 1069s historical background explained by the California Supreme Court in Los Angeles v. San Pedro etc. R. R. Co. (1920) 182 Cal. 652, 655 (San Pedro): All grants of the Crown are to be strictly construed against the grantee, contrary to the usual policy of the law in the consideration of grants; and upon this just ground, that the prerogatives and rights and emoluments of the Crown being conferred upon it for great purposes, and for the public use, it shall not be intended that such prerogatives, rights and emoluments are diminished by any grant, beyond what such grant by necessary and unavoidable construction shall take away.

In the present case, section 11(f) does not purport to diminish any of Anaheims prerogatives, rights and emoluments because Anaheim had no preexisting naming rights to the team name. That section 11(f) may be construed to grant a limited right to Anaheim does not change the analysis; the exception in Civil Code section 1069 applies only to a grant by a public officer or body . . . . (Italics added.) Section 11(f) does not affect the scope of Anaheims grant of a leasehold interest, but merely recites a portion of the consideration Disney agreed to give in return for Anaheims grant.

The distinction between a public entitys grant and return performance by the grantee is illustrated in Stockton v. Stockton Plaza Corp. (1968) 261 Cal.App.2d 639, 646. There, a city leased certain property to a developer, who agreed to construct specified improvements on the land if the developer could secure suitable financing. The developer failed to obtain the required financing and after several years the city sued to terminate the lease. Recognizing no clause in the lease expressly allowed the city to terminate, the court turned to the various rules of statutory construction to determine whether the contract implicitly required the contractor to obtain financing within a reasonable time. In deciding which statutory contract interpretation rules to apply, the court rejected the suggestion the citys status as a public entity might alter the analysis, noting: Civil Code section 1635 directs that All contracts, whether public or private, are to be interpreted by the same rules, except as otherwise provided by this code