Opinion
F051590
4-25-2008
CHARANJIT S. BATTH et al., Plaintiffs, Cross-defendants and Appellants, v. LION RAISINS, INC., Defendant, Cross-complainant and Respondent.
Caswell, Bell & Hillison, Robert K. Hillison and Randolf Krbechek, for Plaintiffs, Cross-defendants, and Appellants. Wild, Carter & Tipton, Steven E. Paganetti, for Defendant, Cross-complainant, and Respondent.
NOT TO BE PUBLISHED
The primary question raised on appeal in this contractual dispute between raisin growers and a raisin packer is whether the trial court erred in using a special verdict form that prevented the jury from finding for the appellant growers on two of their several theories of damages. Although the growers trial counsel stated a preference for a general verdict form, he never objected to the aspects of the special verdict form the growers complain of now. For this reason, we hold that the issue has not been preserved for appeal.
We reject the growers other claims as well: that an award of damages on the respondent packers cross-complaint was based on contracts that should have been held invalid; that the court abused its discretion in allowing defense witnesses to give opinion testimony about the effect of contracts; and that an award of attorneys fees to the packer was improper or excessive. We affirm the judgment.
FACTUAL AND PROCEDURAL HISTORIES
The appellants are Charanjit S. Batth, C. S. Batth & Sons, Kanwarjit S. Batth, and Gagandip S. Batth (the Batths). The Batths are raisin growers. The respondent is Lion Raisins, Inc. (Lion). Lion is a raisin packer. Their dispute concerns the price paid by Lion to the Batths for raisin grapes harvested in 2002.
Baljeet Sidhu and Lakhvir K. Sidhu were also named as plaintiffs in the complaint. They later were dismissed voluntarily from the case.
Lion and the Batths are participants in a system by which raisin growers and packers bargain collectively to set the price of raisins each year. The price is set by a master contract entered into between a group of packers and the Raisin Bargaining Association (RBA), which represents growers. Individual growers and packers then enter into individual agreements pursuant to the master contract.
Another key term of the transactions between growers and packers is the "free tonnage," which is set by the United States Department of Agriculture on the recommendation of the Raisin Administrative Committee (RAC). The free tonnage is the percentage of the total crop that the packers will purchase at the price set by the master contract. The remainder of the crop, called the "reserve" tonnage, is purchased by the RAC at a substantially lower price. The RAC then disposes of the reserve tonnage raisins in ways that prevent them from competing in the market with the free tonnage raisins; for instance, it may store them as a hedge against a short crop or sell them for use in distilleries or as animal feed. (68 Fed.Reg. 15927 (Apr. 2, 2003).)
The raisin crop year runs from August 1 to July 31. The master contract is usually executed early in this cycle, so that the price has been determined by the time growers begin delivering raisins to packers. The 2002-2003 season was unusual, however. Prices were low the previous two years and growers had been hurt. The survival of the RBA was in doubt. In the late summer of 2002, as the 2002-2003 crop year was beginning, the RBA and the packers were unable to reach an agreement.
Despite the lack of a master contract, the Batths and Lion Raisins entered into 12 individual agreements on August 8, 2002. These agreements called for delivery by the Batths to Lion of an estimated 5,460 tons of crops between September 1, 2002 and November 1, 2002. Each printed agreement form included this provision: "This Agreement shall not bind any party unless Packer executes a Contract of Sale with the Raisin Bargaining Association for the crop year(s) above indicated." Typed onto the printed forms was the following additional provision: "If the RBAs Master Contract of Sale is not signed by buyer prior to 9/1/02 this individual agreement can be waived by buyer."
By September, the RBA was cautioning its grower members against delivering their crops to packers without a master contract in place. It sent members a memorandum that said, "`This season is not business as usual. You have no protection without the master contract of sale, only open price contracting with consignment pricing."
The Batths decided to withhold their crop from Lion. They did not deliver any raisins by the November 1, 2002, deadline set forth in the 12 individual agreements. In December 2002, the Batths finally delivered the raisins to Lion, but still did not sell them to Lion at that time. Instead, the parties executed a contract titled Raisin Storage Agreement (raisin storage agreement). Under this agreement, Lion was to store approximately 5,000 tons of the Batths raisins harvested in 2002 until September 15, 2003, for a fee of $46 per ton, unless Lion purchased the raisins during that period, in which case the Batths would not pay the storage fee. The agreement specified that it did "not represent a purchase by Lion or a sale by Batth of the raisins." The agreement was signed sometime during the week following December 10, 2002. Delivery of the raisins began on December 23, 2002, and ended on January 30, 2003.
In January 2003, the RBA and packers finally reached agreement for the 2002-2003 crop season. Lion signed a memorandum of understanding binding it to this agreement on January 16, 2003. For the first time in many years, the agreement between the RBA and packers included a price for two crop years, covering both the 2002-2003 season (Aug. 1, 2002 to July 31, 2003) and the 2003-2004 season (Aug. 1, 2003 to July 31, 2004). The prices announced were $745 per ton for "delivered 2002 raisins" and $810 per ton for "delivered 2003 raisins." The Batths were still in the process of delivering their crop to Lion when the memorandum of understanding was signed. In February 2003, the RAC announced that the free tonnage for the 2002-2003 crop year was 53 percent.
The price actually received by growers is usually somewhat less than the announced price, according to the condition of the raisins and other factors.
This percentage was recommended by the RAC to the United States Department of Agriculture on February 13, 2003. It was announced in the Federal Register on April 2, 2003, and issued as a final rule later. (68 Fed.Reg. 15926, 15928 (Apr. 2, 2003).)
In negotiating the two-year master contract, the RBA expected that some growers would sell their crop harvested in the fall of 2002 before the 2002-2003 crop year was over and receive the 2002-2003 price, while others would retain their 2002 raisins until after the 2003-2004 crop year began and receive the 2003-2004 price.
Although they had already entered into individual agreements with Lion for their 2002-2003 crop, the Batths sought a way to get the 2003-2004 price. They took the position that the 12 individual agreements ceased to be effective when the November 1 delivery deadline passed with no agreement on price between packers and the RBA. Lions view was that the individual agreements remained in effect and that title to the raisins passed to it when it signed the memorandum of understanding on January 16, 2003.
Discussions failed to produce an agreement. Lion stated its intention to begin treating the raisins as its property and the Batths warned Lion against taking this action. On June 3, 2003, the Batths demanded that Lion return the raisins to them. Lion responded on June 30, 2003, by tendering a check for the raisins in the amount of $1,543,584. This amount was based on the 2002-2003 price and the free tonnage of 53 percent. Contending that Lion had no right to the raisins and was guilty of conversion, the Batths refused payment and returned the check on July 25, 2003.
The parties asked the RBA for assistance in resolving their dispute. The RBA declined to get involved, stating only that if Lion had a right to acquire the raisins arising on or before July 31, 2003, then the 2002-2003 price applied, and if it had a right to acquire the raisins arising on or after August 1, 2003, then the 2003-2004 price applied.
On August 6, 2003, Lion sent the Batths a letter that appeared to state that, although Lion would now purchase the raisins in the 2003-2004 crop year, it was still entitled to pay only the 2002-2003 price:
"Per our several meetings and our continuing correspondence we have complied with your request to acquire your 2002/2003 crop year raisins in the 2003/2004 crop year. However, we still reserve the right to charge you the receiving, storage and handling on those raisins, since we did the work. We also still reserve the right to purchase 5,460 tons as per the 12 contracts that you and your family signed on August 8, 2002 at the 2002/2003 RBA price."
A report submitted to the RBA showed that Lion acquired the raisins in the 2003-2004 crop year. In a letter dated October 31, 2003, counsel for Lion explained that the purpose of acquiring the raisins in the 2003-2004 crop year, although at the 2002-2003 price, was to give the Batths the benefit of a potentially higher free tonnage in the 2003-2004 year.
On February 12, 2004, the RAC announced that the free tonnage for the 2003-2004 crop year was 70 percent. (69 Fed.Reg. 21695, 21696 (Apr. 22, 2004).) Taking the position that its acquisition of the raisins in the 2003-2004 crop year entitled it to that years free tonnage, Lion sold 70 percent of the Batths raisins. Lion did not, however, pay the Batths for 70 percent of the raisins. It tendered a check for $1,431,925.08, which reflected the 2002-2003 price and the 2002-2003 free tonnage of 53 percent less deductions for storage fees.
The percentage was recommended by the RAC to the United States Department of Agriculture on February 12, 2004. It was announced in the Federal Register on April 22, 2004, and issued as a final rule later. (69 Fed.Reg. 21695, 21696 (Apr. 22, 2004).)
The Batths filed their complaint in this action on February 24, 2004. Relying on the raisin storage agreement, Lions August 6, 2003, letter, and oral statements, the complaint alleged that Lion breached a contract to pay for the raisins at the 2003-2004 price and free tonnage. The complaint also alleged common counts and unjust enrichment. It claimed that the Batths were entitled to $2,444,905.19 for the raisins, about $1 million more than Lion tendered. The complaint prayed for damages and declaratory relief. It also prayed for attorneys fees based on an attorneys fees clause in the raisin storage agreement.
In March 2004, the parties signed a stipulation where the Batths accepted the tender without prejudice to either sides claims or defenses.
Lion filed a cross-complaint. It alleged that, although the Batths 2002-2003 production was in excess of the approximately 5,460 tons called for by the 12 individual agreements, the Batths delivered 770 tons less than this amount. It also claimed that the Batths failed to return storage bins. The causes of action were breach of contract, breach of the implied covenant of good faith and fair dealing, and common counts. The cross-complaint prayed for damages of not less than $100,000 for undelivered raisins and not less than $55,984.50 for failure to return bins. It also prayed for attorneys fees. On the claim of breach of the implied covenant of good faith and fair dealing, the cross-complaint sought punitive damages.
The case was tried to a jury, which was given a special verdict form. On the Batths breach-of-contract claim, the forms first question asked, "Did Batth Family and Lion Raisins enter into a contract which gave the Batth Family the right to sell their 2002 raisins at the RBA designated 2003 crop price?" The jury answered "no." The form instructed the jury, if it answered no, to ignore the remaining questions on breach of contract and proceed to the first question on the common counts. That question asked, "Do you find that Lion Raisins was obligated to pay the Batth Family for its 2002 raisin crop at the price for the 2003 crop price set by the RBA?" The jury again answered "no." The form instructed it, if it answered no, to proceed to the first question on unjust enrichment. That question asked, "Did Lion Raisins have an obligation to pay the Batth Family for the 2002 raisin crop at the 2003 crop price set by the RBA?" The jury again answered "no." The form next instructed the jury, if its answer was no, to proceed to the first question on Lions claim for breach of contract. It asked, "Did the Batth Family breach any of the 12 Individual Agreement[s] with Lion Raisins?" The jury answered "yes." The next question was whether Lion was harmed by the breach; the jury answered "yes" and wrote in response to the next question that the damages were $76,153.11. The jury also wrote "yes" in response to the question "[d]o you find the Batth Family failed to pay Lion Raisins for bins provided under an open account?" It found damages of $4,510 on this claim. Finally, in response to the questions on Lions claim of breach of the implied covenant of good faith and fair dealing, the jury found that the Batths unfairly interfered with Lions right to receive the benefits of the 12 individual agreements; it found no additional damages for this claim, however. The court entered judgment against the Batths on their complaint. It entered judgment for $80,663.11 in favor of Lion on its cross-complaint.
Lion filed a motion for attorneys fees based on the fee provision in the raisin storage agreement. The court granted the motion, awarding $108,710.50 in fees. The court also granted Lions motion for prejudgment interest, awarding $19,778.96.
DISCUSSION
I. Verdict form
The Batths state in their opening brief that they "do not dispute the jurys finding that the price to be paid was the 2002/03 price." Instead, they argue that the jury should have been given an opportunity to find that Lion was required to pay for the 2003-2004 free tonnage—70 percent—because Lion took title to and sold 70 percent of the raisins. They calculate that if Lion had paid for 70 percent at the 2002-2003 price instead of 53 percent, they would have received an additional $560,043.93. As it was, no one paid the Batths anything for the 17 percent difference: Lion did not pay and the RAC could not, since Lion sold the raisins. The Batths also contend that the $1,431,925.08 check tendered by Lion and accepted by them reflected an improper deduction of $258,978 for receiving, handling, and storage. They say there should have been no deduction because the raisin storage agreement provided that there would be no charges if Lion ultimately bought the raisins.
The Batths assert that the courts failure to order Lion to pay the 17 percent difference and return the receiving, handling, and storage charges was unjust. They also claim that the verdict was contrary to the evidence because it failed to include awards to them for these items. The failure to award the Batths anything for these claims was made inevitable by the special verdict form, which included no means of awarding anything for them. For each cause of action, the form simply asked whether Lion was required to pay the 2003-2004 price and directed the jury to proceed to the next cause of action if the answer was no. It was impossible for the jury to find that Lion was obligated to pay, at the 2002-2003 price, for that 17 percent of the raisins it sold but never paid for at any price. It was also impossible for the jury to find that the deductions for receiving, handling, and storage breached the parties agreement.
To preserve this argument for appeal, the Batths were required to make a specific objection to the verdict form at trial. As a general rule, an appellate court will not review an issue that was not raised in the trial court. (9 Witkin, Cal. Procedure (4th ed. 1997) Appeal, § 394, p. 444.) The point of this rule "is simply that it is unfair to the trial judge and to the adverse party to take advantage of an error on appeal when it could easily have been corrected at the trial." (Id. at p. 445.) "`The law casts upon the party the duty of looking after his legal rights and of calling the judges attention to any infringement of them. If any other rule were to obtain, the party would in most cases be careful to be silent as to his objections until it would be too late to obviate them, and the result would be that few judgments would stand the test of an appeal." (Sommer v. Martin (1921) 55 Cal.App. 603, 610.) As applied to an assertedly defective special verdict form, the preservation doctrine has been held to require an objection before the discharge of the jury. (Jensen v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112, 131.) Although the Batths raised a version of this argument in a motion for a new trial, they do not claim they preserved the argument for appeal by doing so.
During the discussion between the court and counsel about the verdict form, the Batths counsel stated a preference for a general verdict form rather than a special verdict form and criticized specific language in Lions proposed special verdict form:
"I would prefer a general verdict. I think it would be simpler for the jury. And I think to the extent to which the jury might agree with the Court that this case is a, quote, `mess, end quote, um, I think the jury would find a general verdict easier to work with and focus their attention on what they think the real issues of this case are.
"I have reviewed the protested special verdict form that Mr. Paganetti [Lions counsel] proposed. And, I have objections to it. If the Court grants Mr. Paganettis request to use a special verdict form, this verdict form has to be in my judgment and based on my request, I would want to correct it and make some changes."
Lions counsel agreed to all but one of the Batths counsels proposed changes. The remaining proposed change concerned the following question, drafted by Lions counsel, about unjust enrichment: "`Did Lion Raisins have no intent, either express or implied, to pay or make reimbursement for something of value of something received by it for the 2002 raisin crop?" When the court found this difficult to understand, the Batths counsel suggested an alternative: "`Did Lion Raisins obtain a benefit at the expense of plaintiffs when it acquired plaintiffs raisins?" This is the language that was ultimately included in the verdict form. The court agreed with the Batths view that a general verdict form would be easier for the jury to understand, but adopted the special verdict form because it thought apportionment of attorneys fees might require separate jury findings on separate causes of action.
To summarize: The Batths expressed a preference for a general verdict form, arguing that it would be less confusing for the jury; the court opted for a special verdict form for reasons related to the anticipated fee motion. Further, the Batths requested changes to Lions proposed special verdict form; the court adopted these changes.
On the basis of this record, we conclude that the Batths did not make the objection that was necessary to preserve for appeal the issue they now raise. The discussion between the court and counsel about the verdict form never touched on the two items of damages that form the basis of the Batths claim on appeal. As we have said, the purpose of the preservation rule is to give the court a chance to fix the asserted problem during the trial. It would have been easy for the Batths counsel to say that any special verdict form must give the jury an opportunity to find that Lion owed payment for the free tonnage raisins it never paid for and that Lion had to pay back the fees for receiving, handling, and storage that it had deducted. His failure to do so means the issue has been waived.
The case the Batths cite, Demkowski v. Lee (1991) 233 Cal.App.3d 1251, does not undermine our conclusion. There, the defendant argued on appeal that the court erred in using verdict forms that allowed the jury to award a double recovery against her. "Since defendant objected to the verdict forms adopted by the court, the issue raised is properly before us," the Court of Appeal held. (Id. at p. 1257.) The opinion does not make clear whether the defendant objected to the verdict forms because they made a double recovery possible or on some other ground. We see no reason to interpret it, however, to mean that a party can preserve an objection to a verdict form on one ground by making an objection on another ground. Further, the holding of the case is that the verdict forms rendered the verdict ambiguous and there was no way to interpret the verdict to eliminate the ambiguity, making a remand unavoidable. (Id. at p. 1254.) There is no similar problem here.
The Batths argue that the special verdict form resulted in a miscarriage of justice because the Batths were denied any payment for 17 percent of their raisins and because Lion took and sold those raisins without paying anyone for them. On this ground, it might be argued (although the Batths have not actually done so) that we should exercise our discretion to reach the issue even though it was not preserved. (Redevelopment Agency v. City of Berkeley (1978) 80 Cal.App.3d 158, 167.) We do not, however, think the result is a miscarriage of justice. In essence, the verdict form gave the jury a choice between making a finding that would maximize the Batths damages—i.e., the finding that Lion was required to pay for the raisins at the 2003-2004 price—and making a finding that would preclude the Batths from receiving any damages. In other words, the form eliminated the possibility of a middle position on the Batths claims. A plaintiffs attorney might put a jury to this kind of choice for strategic reasons or might do so through inadvertence. Either way, justice does not require a new trial just because the jury took the defense-favoring option.
We are not persuaded by caveats our Supreme Court has issued on the subject of when an objection may be unnecessary to preserve the issue of a verdicts defective form. Woodcock v. Fontana Scaffolding & Equip. Co. (1968) 69 Cal.2d 452, 456-457, footnote 2, includes the following discussion:
"Frequently, failure to object to the form of a verdict before the jury is discharged has been held to be a waiver of any defect. [Citations.] However, waiver is not automatic, and there are many exceptions. [Citations.] [¶] Waiver is not found where the record indicates that the failure to object was not the result of a desire to reap a `technical advantage or engage in a `litigious strategy. [Citations.] Thus, in Fernandez v. Consolidated Fisheries, Inc. [(1953) 117 Cal.App.2d 254 at pp.] 262-263, where plaintiff sought damages for negligence and the intervener sought reimbursement for its workmens compensation payments to plaintiff, the jury verdict was ambiguous when it awarded $50,000 to plaintiff and $8,813.87 to intervener without specifying whether the $50,000 represented the total amount of damages or a net sum to plaintiff. A more certain verdict was not requested. The court, weighing the merits, concluded that the trial judge had properly interpreted the verdict. In a Fernandez situation, as in many other cases, waiver is not an issue where a defect is latent and there is no hint of `litigious strategy."
Interpreting this footnote, Witkin says, "[F]ailure to raise the objection does not always result in a waiver; some element of negligence or culpability must appear ...." (7 Witkin, supra, Trial, § 385, p. 439.) In this case, we do not know whether the failure to make the pertinent objection was strategic or negligent, but it must have been one or the other. We are not dealing with a situation in which a jury produces an ambiguous or inconsistent verdict through no fault of any party. Instead, the jury received a special verdict form that reflected plaintiffs edits and was accepted by plaintiffs (except for the nonspecific complaint that a general verdict form would be less confusing) but that logically precluded two of plaintiffs alternative theories of damages. We conclude the preservation requirement should be applied under these circumstances.
We are conscious of the incongruity of a buyer taking several hundred tons of raisins, paying nothing for them, and still prevailing over the sellers unjust-enrichment claim. It is, however, a plaintiffs responsibility either to make sure the jury is provided with a way to find in its favor on each issue or to make specific objections to actions taken by the court that would prevent this from happening. The Batths failed to do so here. It would be unfair to put Lion to the expense of another trial because the Batths omitted to do at trial what could have cured the problem they complain of on appeal.
II. Illusory promise
As we have said, the jury awarded Lion $76,153.11 for the claim in its cross-complaint that the Batths delivered a smaller quantity of raisins than was called for by the 12 individual agreements signed by the parties on August 8, 2002. In a motion in limine, the Batths had argued that this claim and the evidence for it should not be presented to the jury because the 12 individual agreements were invalid, mainly because Lions promise to buy was illusory. The court denied the motion. The Batths renew this contention on appeal. The pertinent facts are not in dispute and the contention raises only questions of law, so we review the trial courts ruling de novo. (Robinson & Wilson, Inc. v. Stone (1973) 35 Cal.App.3d 396, 407 ["`[W]hether a certain or undisputed state of facts establishes a contract is [a question] of law for the court"].)
The 12 individual agreements, as indicated earlier, signaled the parties intention to purchase and sell raisins at the price established by the RBAs negotiations with packers. The Batths claim of an illusory promise arises from two provisions designed to permit Lion not to purchase the raisins if it decided not to be part of the RBA agreement. Paragraph 6 of the individual agreements, which was part of the printed agreement form, read as follows:
"MASTER CONTRACT OF SALE WITH ASSOCIATION
"This Agreement shall not bind any party unless Packer executes a Contract of Sale with the Raisin Bargaining Association for the crop year(s) above indicated."
Paragraph 6a, which was typed onto the form, gave Lion even more flexibility:
"If the RBAs Master Contract of Sale is not signed by buyer prior to 9/1/02 this individual agreement can be waived by buyer."
Paragraph 6 gave Lion an option not to buy the Batths raisins if it chose not to be part of the collective bargaining scheme for the year. Paragraph 6a gave Lion the additional option of not buying the Batths raisins even if it did choose to be part of the collective bargaining scheme, so long as it did not sign on to the master contract before September 1, 2002. In the Batths view, these two provisions meant Lions choice to buy or not to buy the raisins was unconstrained, so its promise to do so was illusory and the 12 individual agreements therefore were unsupported by consideration on Lions side.
"If what appears to be a promise is an illusion, there is no promise. Like the mirage of the desert with its vision of flowing water which yet lets the traveller die of thirst, there is nothing there." (2 Corbin on Contracts (rev. ed. 1995) § 5.28, p. 142.) Where parties purport to form a contract by exchanging promises, but "one of the promises leaves a party free to perform or to withdraw from the agreement at his own unrestricted pleasure, the promise is deemed illusory and it provides no consideration." (Mattei v. Hopper (1958) 51 Cal.2d 119, 122.) The resulting lack of consideration on one side is sometimes referred to as a lack of "mutuality of obligation," but this is only another name for the same legal doctrine. (Ibid.)
The key question in the illusory-promise analysis is whether a party had an unrestricted option to perform or withdraw. An option to withdraw that still imposes some constraint on the withdrawing partys conduct does not make that partys promise illusory.
In this case, Lions promise to buy was not illusory because its option to withdraw was restricted. A hypothetical in Corbin provides a suitable illustration. "A" is considering buying a ship from a third party. "B" wishes to charter the ship. "A" and "B" enter into an agreement where "A" promises to charter the ship to "B" and "B" promises to accept the charter, but only if "A" decides to buy the ship. "As" promise is not illusory and the exchange of promises forms a bilateral contract. "As" promise is not illusory because his option to avoid performing is restricted: if he decides not to perform, he cannot buy the ship. (2 Corbin, supra, § 6.9, pp. 286-287.) Similarly, Lions option not to buy the Batths raisins was restricted. If Lion had decided not to buy the raisins, it could not, without breaching its promise, have entered into the RBAs master contract (if there had been one) before September 1, 2002. This restriction might have been a small one, but it need not have been large to constitute consideration. "[T]he law will not enter into an inquiry as to the adequacy of the consideration." (Schumm v. Berg (1951) 37 Cal.2d 174, 185.)
The Batths also argue that the 12 individual agreements were invalid because they had an open price term (i.e., the price depended on the as-yet unmade master contract), and the price was not "timely established." Their claim appears to be that the price term had to be established by September 1, 2002, the date after which Lion was entitled to withdraw from the individual agreements if it had not yet signed the master contract. This claim is without merit. Nothing in the individual agreements stated or implied that the agreements were binding only if the master contract was settled by that date. Testimony by Bruce Lion quoted in the Batths opening brief does not alter this result. Further, the case the Batths cite, Lazar v. Hertz Corp. (1983) 143 Cal.App.3d 128, does not support their position. It simply holds that "an open term in a contract must be filled by the party having discretion within the standard of good faith and fair dealing." (Id. at p. 141.) The Batths have not shown that Lion breached its duty of good faith and fair dealing by simply waiting for the RBA negotiations to settle the price.
Bruce Lion merely said that, if he had decided not to buy after September 1, 2002, he would have given notice of that decision:
"Q. So what Im saying is: You didnt want to be bound—right?—if you didnt sign by September 1, 2002?
"A. We were bound to the RBA price provided the contract was signed with the RBA by September 1, 02. After said date, we would have given notice that we had no more intentions to buy the raisins because we were in ongoing negotiations with the RBA."
For these reasons, we reject the Batths claim that the 12 individual agreements were not validly formed. The trial court did not err in denying the motion in limine.
III. Legal opinion testimony
The Batths argue that the court erred in admitting several witnesses testimony to their opinions about the effects of the parties agreements. They contend that this testimony was inadmissible because it stated legal opinions. We hold that the Batths failed to preserve their objections to most of this testimony and that the remainder, if it were inadmissible, was not prejudicial.
Opinion testimony that states legal conclusions infringes on the trial judges functions and is inadmissible. (Summers v. A. L. Gilbert Co. (1999) 69 Cal.App.4th 1155, 1178-1181; Downer v. Bramet (1984) 152 Cal.App.3d 837, 841.) To preserve for appeal a claim that inadmissible evidence was admitted, a party must object at trial. (People v. Gates (1987) 43 Cal.3d 1168, 1185; Perry v. McLaughlin (1931) 212 Cal. 1, 6.) "Where inadmissible evidence is offered, the party who desires to raise the point of erroneous admission on appeal must object at the trial, specifically stating the grounds of the objection, and directing the objection to the particular evidence that the party seeks to exclude." (3 Witkin, Cal. Evidence (4th ed. 2000) Presentation at Trial, § 371, pp. 459-460.) A motion in limine can sometimes preserve objections to inadmissible evidence, but the trial court has discretion, in ruling on the motion, to order the parties to object on a question-by-question basis during the examination of a witness. (People v. Morris (1991) 53 Cal.3d 152, 190-191, overruled on other grounds by People v. Stansbury (1995) 9 Cal.4th 824, 830, fn. 1.)
If the issue is preserved, we review the courts admission of the testimony for an abuse of discretion. In general, a trial courts exercise of discretion in admitting or excluding evidence "will not be disturbed except on a showing the trial court exercised its discretion in an arbitrary, capricious, or patently absurd manner that resulted in a manifest miscarriage of justice ...." (People v. Rodriguez (1999) 20 Cal.4th 1, 9-10.) This means the judgment must not be reversed unless "a different result would have been probable if [the challenged ruling] had not occurred or existed." (Code Civ. Proc., § 475.) Further, the standard of People v. Watson (1956) 46 Cal.2d 818, deeming trial error harmless unless there was a reasonable probability of a different outcome absent the error, applies to civil trials as well as criminal trials. (Cassim v. Allstate Ins. Co. (2004) 33 Cal.4th 780, 801.)
The Batths filed a motion in limine requesting exclusion of legal opinion testimony. The motion stated:
"Plaintiffs anticipate defendant may attempt to offer expert or lay witness opinions on the following issues, all of which are legal issues for the Court:
"1. If and/or when legal title to plaintiffs raisins passed to defendant;
"2. When legal title to raisins passes under the RBA Master Contract;
"3. Whether plaintiffs were obligated to deliver their raisins to defendant under the 12 Individual Agreements.
"This Court should issue an order prohibiting the introduction of any opinion or other testimony regarding the above issues, which are legal issues to be determined by the Court."
The trial court stated that it was granting the motion, but at the same time indicated that some testimony related to these issues would be admissible and that the ruling would be subject to redetermination on a question-by-question basis as the trial proceeded:
"Well, I would agree that experts should not be allowed to offer opinions with regard to issues of law, but experts certainly can offer opinions and the bases for their opinions with regard to any factual issues. And it may be that their opinions parallel some of the issues of law.
"So I guess well just have to take it on a question-by-question or expert-by-expert basis and see what the questions are and determine the parameters of what the testimony will be as—as we go. So well—that one, Ill just say—Ill grant that motion No. 4, but it will be subject to review whenever the issue comes up, of course—any of these motions are."
On appeal, the Batths claim the court should have excluded certain testimony by three witnesses: Glen Goto, chief executive officer of the RBA; Kalem Barserian, general manager of Lion Raisins and a former chief executive officer of the RBA; and Bruce Lion, vice president of sales of Lion Raisins.
The question of the admissibility of Gotos testimony has not been preserved for appeal. The Batths brief identifies Gotos answers to nine questions, reported on pages 1017, 1018, 1026, 1032, 1033, 1043, and 1044 of the reporters transcript. It also points to opinion testimony of Goto that Lions counsel quoted during his closing argument. The Batths counsel did not object to any of these questions or move to strike any of the answers. He also did not object to the references to Gotos testimony in Lions closing argument. The trial courts ruling on the motion in limine made it clear that, although the trial court was alert to the danger of witnesses offering legal opinions, whether any particular question asked for or any particular answer constituted a legal opinion would have to be determined as individual questions were asked. The courts statements put the onus on counsel to make individual objections to individual questions. Counsel did not do so.
The Batths identify two sets of answers given by Barsarian. The first of these concerns undisputed facts about the relationship between growers and the RBA:
"Q. Now, lets talk about the process of what happens when an RBA grower signs on with the RBA. Is there an agreement that the RBA member signs?
"A. Yes.
"Q. And after the RBA member signs the agreement, what effect does that have on the RBA members raisins in any particular crop year?
"MR. HILLISON [the Batths counsel]: Your Honor, to the extent to which this question calls for a legal conclusion, I object.
"THE COURT: Okay. And the objection is sustained to that extent, but it doesnt call for a legal conclusion, even partially. [¶] So you can answer that.
"THE WITNESS: Well, its called `The Membership Agreement. And in this membership agreement, the grower commits that any raisins—or any grapes, excuse me, grown on any of his ranches, his or her ranches, that is owned by the person thats joining the association,—they commit their grapes that are made into raisins to be sold to the RBA, for the RBA to act as one voice.
"MR. PAGANETTI: Q. So when you were negotiating with the signatory packers in your capacity of C.E.O., you were negotiating on behalf of the RBA members?
"A. Yes.
"Q. And you were negotiating the price for the RBA member grapes?
"A. Raisins.
"Q. Raisins, excuse me.
"A. Yes."
Even assuming this testimony stated a legal conclusion—and even assuming the ruling sustaining the objection to the question did not mean counsel had to make a motion to strike if he thought the answer was inadmissible—the testimony could not have damaged the Batths case. The fact that a grower joining the RBA commits to selling its crop through the RBA was not in dispute. There was, therefore, no reasonable probability of a better outcome for the Batths absent this testimony, and any error in admitting it was harmless.
The second set of answers by Barsarian related to the passing of title to raisins:
"Q. Excuse me. Now, based on your experience, do you have an opinion regarding when title passes to the raisins from the RBA member to the Raisin Bargaining Association?
"MR. HILLISON: Im going to object, your Honor. Calls for a legal conclusion.
"THE COURT: Okay. Overruled. [¶] You can answer.
"THE WITNESS: In the master contract with the signatory packers when it becomes effective under, I believe, something like 14(g)(3), it states that, once the master agreement is signed between the parties, meaning the Raisin Bargaining Association and the signatory packer, the minute thats signed, the title passes to the packer at the time that the agreement is in force. [¶] ... [¶]
"Q. ... Do you have an opinion regarding when title to the Batth family raisins passed to Lion Raisins relative to the 2002 crop?
"MR. HILLISON: Again, your Honor, Im going to object on the grounds that it calls for a legal conclusion.
"THE COURT: All right. Overruled. [¶] You can answer.
"THE WITNESS: Well, I—I believe that transferred here, and it also transferred when we submitted the check on June the 30th."
The Batths do not, in their appellate briefs, explain exactly how this testimony was damaging to their case. Presumably, the point is that if Lion obtained title on January 16, 2003, when it signed the memorandum of understanding with the RBA, or on June 30, 2003, when it tendered payment to the Batths, or at any other time before August 1, 2003, when the 2003-2004 crop year began, then it was not obligated to pay the 2003-2004 price. Assuming the questions asked for, and the answers supplied, legal conclusions about this issue, however, the admission of the testimony did not cause a miscarriage of justice. The testimony presented an interested witnesss opinion that the agreements at issue favored his sides position. That Barsarian—Lions general manager—endorsed the view argued for by Lions counsel is not a surprise and did not likely have a significant influence on the jury. There is no reasonable probability that the Batths would have obtained a better outcome absent this testimony; therefore, any error in admitting it was harmless.
Finally, the Batths argue that the following testimony of Bruce Lion was inadmissible:
"Q. By signing this agreement with the 2002 crop year, when the RBA set the 2002 price, you had to pay that 2002 price?
"MR. HILLISON: Objection. Calls for a legal conclusion.
"THE COURT: Sustained as to calling for a legal conclusion. [¶] But to the extent it does not, you can answer that.
"THE WITNESS: Yes, I—I was obligated by my contract with the RBA to pay the 2002 announced price."
Again, assuming this testimony stated a legal conclusion—and even assuming the ruling sustaining the objection to the question did not mean counsel had to make a motion to strike if he thought the answer was inadmissible—the testimony did not damage the Batths case. The answer did not state a seriously debatable proposition: Of course Lions agreement with the RBA for 2002 meant Lion was to pay the RBAs 2002 price for raisins subject to that price. The parties dispute in this case turned on other questions, principally whether the Batths raisins were subject to the 2002 price at the time of purchase or not. It is not reasonably probable that the Batths would have obtained a more favorable outcome absent this testimony; any error in admitting it was harmless.
IV. Attorneys fees
The trial court awarded Lion $108,710.50 in attorneys fees—the full amount requested—based on the following provision of the raisin storage agreement:
"Attorneys Fees. In the event of any litigation or arbitration to enforce this Agreement or to obtain a declaration of any rights hereunder, the prevailing party shall be entitled to recover its attorneys and experts fees and costs, in addition to such other relief as the court or arbitrator may award."
The Batths argue that the only issue presented to the jury that involved the raisin storage agreement was the claim in Lions cross-complaint that the Batths owed Lion for storage bins. On this issue, the jury gave an affirmative answer to the question, "Do you find the Batth Family failed to pay Lion Raisins for bins provided under an open account?" On the basis of this, the jury awarded Lion $4,510. The Batths claim the court should have awarded attorneys fees for work performed in connection with this claim only, not for all the work Lions attorneys performed in the case.
When a contract provides for attorneys fees, the court in an action on the contract must fix a reasonable fee amount and award it to the prevailing party. (Civ. Code, § 1717.) A defendant in an action on a contract that includes a fee provision is entitled to fees if it prevails, even if it prevails by showing that the contract was never formed. (Bovard v. American Horse Enterprises, Inc. (1988) 201 Cal.App.3d 832, 842; Jones v. Drain (1983) 149 Cal.App.3d 484, 489-490.) In general, fees can only be awarded for prevailing on a claim based on the contract containing the fee provision, as opposed to other claims joined in the complaint that are based on tort or on another contract. The prevailing partys fees should be apportioned by the court between those that can be awarded under the contractual fee provision and those that cannot. If, however, the additional claims are based on the same facts, no apportionment is required: "Attorneys fees need not be apportioned when incurred for representation on an issue common to both a cause of action in which fees are proper and one in which they are not allowed." (Reynolds Metals Co. v. Alperson (1979) 25 Cal.3d 124, 129-130.)
Some Court of Appeal panels have held that an award under a contractual attorneys fees clause should be reviewed for an abuse of discretion, while others have held that it should be reviewed de novo. (See Exxess Electronixx v. Heger Realty Corp. (1998) 64 Cal.App.4th 698, 705 & fn. 9 [citing cases taking each position].) We need not decide which standard is correct, since we would affirm under either one.
Contrary to the Batths argument, Lions claim for bin rentals was not the only claim based on the raisin storage agreement. The Batths relied on the raisin storage agreement to support their own claims in the complaint. According to the complaint, the 12 individual agreements had expired by the time the parties negotiated the raisin storage agreement; the purpose of the raisin storage agreement was to supersede the 12 individual agreements. The complaint claims that, after executing the raisin storage agreement, the parties entered into another contract that was "partly oral and partly in writing" where Lion was to pay the 2003-2004 price for the raisins. As described in the complaint, then, the raisin storage agreement helped free the Batths from any obligation to sell the raisins at the 2002-2003 price, clearing the way for the alleged contract to sell at the 2003-2004 price. The raisin storage agreement was an important part of the main claim in the Batths complaint, the claim that Lion breached a contract to buy the raisins at the higher price. The Batths counsel made a similar argument to the jury in his closing statement. He described the raisin storage agreement as a "new agreement" that made "some very significant and important changes to the way those individual agreements would operate ...." He repeated the claim that the raisin storage agreement superseded the 12 individual agreements, saying that "[c]ommon sense" dictates that the "later contract controls." He also argued that, because the raisin storage agreement did not state that Lion had a continuing right to buy the raisins under the individual agreements, it implied by omission that Lion had no such right.
Since the Batths elected to make the raisin storage agreement a critical part of their strategy for establishing a breach of contract, we conclude that their lawsuit was, in the words of the raisin storage agreements attorneys fees clause, "litigation ... to enforce this Agreement or to obtain a declaration of any rights hereunder ...." Further, the other causes of action in the complaint—common counts and unjust enrichment—were based on the same facts as the breach-of-contract claim, so apportionment was not required. The Batths themselves evidently believed the fee clause in the raisin storage agreement applied to their claims, for they quoted the clause in the complaint and prayed for attorneys fees. The claim for undelivered raisins in Lions cross-complaint also involved the same fundamental issue: whether the 12 individual agreements remained enforceable in the period after the raisin storage agreement was signed. For these reasons, we hold that the trial court did not err in granting Lions fee motion for the full amount requested.
DISPOSITION
The judgment is affirmed. Lion shall recover its costs on appeal.
WE CONCUR:
Levy, J.
Kane, J.