Opinion
NOT TO BE PUBLISHED
Appeals from a judgment and postjudgment orders of the Superior Court of Orange County No. 05CC06828 Charles Margines, Judge.
Paul, Hastings, Janofsky & Walker, William S. Waldo, Paul W. Cane, Jr., and Rishi N. Sharma; Bononi Law Group and William S. Waldo for Defendant and Appellant Automotive Wheels, Inc.
Hart, King & Coldren, Robert S. Coldren, Christopher R. Elliott, Kathy Watte Nichols and Rhonda H. Mehlman for Plaintiff and Appellant Brea Imperial, Inc.
OPINION
IKOLA, J.
Defendant Automotive Wheels, Inc. (AWI), appeals from a judgment entered upon a jury verdict for plaintiff Brea Imperial, Inc. (BII). The jury found AWI breached a contract granting it a license to store equipment in BII’s industrial building and committed various torts by leaving equipment and contamination in the warehouse.
AWI concedes most of the basic facts and its contract liability, but challenges the damages. It claims the contract damages constitute an illegal penalty. It asserts the trespass, negligence, and fraud damages are duplicative of the contract damages. It claims the trespass and negligence damages are barred by the contract and excessive. And it contends the conspiracy damages are duplicative of the other damages.
Only some of these claims find their marks. The contract does contain a penalty clause that cannot be enforced. But that does not absolve AWI of its contract liability. The record shows AWI failed to vacate the facility after the license term, causing BII to suffer actual contract damages exceeding the amount awarded pursuant to the penalty clause. Thus, the contract damages may be upheld. The trespass damages are not barred by the contract, but they must be reduced because they compensate BII for the same injury as the contract damages - AWI’s failure to vacate the facility. The negligence damages may be upheld because they reasonably compensate BII for AWI’s contamination of the facility. The fraud damages cannot be upheld because they compensate BII for the same injury as the negligence damages. And conspiracy is not an independent cause of action at all. BII may not recover conspiracy damages for injuries - the holding over and clean up costs - fully compensated by the contract, trespass, and negligence damages.
BII cross-appeals from postjudgment orders declining to award punitive damages, denying leave to amend the complaint to add an alter ego defendant, and declining to impose evidentiary or terminating sanctions against AWI. Only its first claim has merit. The court found the contract barred BII from recovering punitive damages from AWI. But the relevant clause does not extend so broadly.
Thus, we reverse and remand for the court to enter a new judgment that awards only (1) contract damages in the original amount, (2) trespass damages reduced by the amount of contract damages, (3) negligence damages in the original amount, and (4) punitive damages in whatever amount is supported by the record.
FACTS
BII bought a warehouse and manufacturing facility in Brea in March 2004. The facility had been leased by a company that made vehicle wheels using equipment leased from AWI. That company had declared bankruptcy and its facility lease was terminated.
BII wanted the AWI equipment removed so it could market the warehouse to new tenants. BII informed AWI in April 2004 that BII would dispose of the equipment unless AWI claimed it and paid reasonable storage fees. (See Civ. Code, §§ 1983, 1985.) After that time expired, BII advertised a public auction of the equipment for June 18, 2004. (See § 1988.)
All further statutory references are to the Civil Code.
Three days before the auction, BII and AWI entered into an “Agreement Regarding Storage of AWI Equipment.” According to the recitals, “BII has advised AWI that the reasonable storage costs associated with keeping the Equipment on-site at the Property is approximately $120,000 per month, ” but “AWI has recently contacted BII about a possible compromise proposal whereby AWI would pay a reduced rental/storage fee of $225,000 in exchange for a commitment to work diligently to dismantle and move the Equipment out of the Brea Facility by the end of August, 2004.”
Accordingly, BII granted a “personal, non-transferable license” to AWI to store the equipment at the facility from June 1 to August 31, 2004. AWI agreed to pay $225,000 to cover three months of storage fees at $75,000 per month. AWI further agreed to pay the lesser of $75,000 or one-third of the net proceeds from the sale of any equipment it chose not to remove. It promised not to “operate or otherwise utilize the Equipment for any manufacturing or similar activities....” And AWI agreed that if it failed to remove the equipment during the license term, BII could auction off the equipment and “recover the full and fair value of storing the Equipment since the date BII purchased the Brea facility on March 11, 2004, i.e., $120,000 per month, less Storage Fees actually received by BII.” The agreement was later amended in writing and orally to extend the license term on the same terms to January 31, 2005.
Ultimately, BII sued AWI on several causes of action. The court bifurcated the liability and punitive damages phases. In the September-October 2007 liability phase, the evidence showed the following facts.
AWI had allowed the utility to shut off electrical power to the facility in February 2004. As a result, the facility was flooded. AWI did not disclose the power shut-off or the flooding to BII. There were “massive amounts of oil on the floor.”
AWI later worked with its parent corporation, Titan International, Inc. (Titan), to dispose of the equipment. They allowed a middleman to make wheels in the facility to demonstrate the equipment for a potential buyer. They later moved some equipment to a Titan plant, where some was stored and some was sold. They auctioned off other equipment at the facility for approximately $93,000.
But AWI and Titan left equipment, machinery, oil, sludge, solvents, barrels, pallets, debris, and contamination at the facility after the agreement expired on January 31, 2005. BII auctioned off the leftover equipment for $2,300. BII then spent $300,000 to $400,000 - “a minimum” of $300,000 - to remediate the facility and prepare it for releasing. The facility was not ready to show to potential tenants until July 2005, “plus or minus a month.” The reasonable rental value of the facility was “around” $110,000 or $114,000 per month.
The jury returned special verdicts for BII on each of its causes of action on October 30, 2007. It awarded these damages: (1) breach of contract, $689,945; (2) trespass, $840,000; (3) negligence, $300,000; (4) fraudulent inducement, $279,970; (5) fraud, $279,970; (6) waste, $248,690; and (7) conspiracy, $1,668,370. The jury also found AWI acted with malice, oppression, or fraud.
The court conducted the punitive damages phase in January 2008. After hearing testimony, the court found the agreement barred BII from recovering punitive damages. It entered an order denying punitive damages in March 2008.
The court entered judgment for BII in May 2008. It later entered judgment notwithstanding the verdict for AWI on the waste and fraudulent inducement causes of action.
The court conducted postjudgment proceedings on BII’s alter ego allegations on several days spread out over 2008. It issued an order in February 2009 finding Titan was the alter ego of AWI. It issued an “amended judgment” adding Titan as a judgment debtor.
DISCUSSION
BII May Recover the Contract Damages, Despite the Agreement’s Illegal Penalty Clause
AWI concedes its contract liability. But it disputes the amount of the contract damages, claiming it was based on an illegal penalty clause. The agreement provided BII would recover the “full and fair” rental amount of $120,000 per month, accruing as of March 11, 2004, if AWI failed to remove the equipment during the license term - which was ultimately extended to January 31, 2005. That amount - $120,000 per month times 10.5 months - is $1,260,000. AWI paid the “reduced rental/storage fee” of $75,000 per month from June 1, 2004 to January 31, 2005, for a total of just over $600,000. The difference between what AWI agreed to pay in the event of a breach and what AWI actually did pay is approximately $658,000. The agreement further provided that AWI would pay a “‘conditional storage fee’” of one-third of the net proceeds from AWI’s equipment auction, which were approximately $93,000. Thus, the outstanding amount of the “full and fair” monthly rental amount ($658,000) plus one-third of the auction proceeds ($31,000) is approximately $689,000. The jury awarded contract damages of $689,945.
“[A] provision in a contract liquidating the damages for the breach of the contract is valid unless the party seeking to invalidate the provision establishes that the provision was unreasonable under the circumstances existing at the time the contract was made.” (§ 1671, subd. (b).) Conversely, a “liquidated damages clause will generally be considered unreasonable, and hence unenforceable... if it bears no reasonable relationship to the range of actual damages that the parties could have anticipated would flow from a breach.” (Ridgley v. Topa Thrift & Loan Assn. (1998) 17 Cal.4th 970, 977 (Ridgley), citation omitted.) “The key in determining whether the damages are a penalty... is whether there is a reasonable relationship between the amount to be paid and the damages.” (Greentree Financial Group, Inc. v. Execute Sports, Inc. (2008) 163 Cal.App.4th 495, 502 (Greentree).) “Whether an amount to be paid upon breach is to be treated as liquidated damages or as an unenforceable penalty is a question of law.” (Harbor Island Holdings v. Kim (2003) 107 Cal.App.4th 790, 794 (Harbor Island).)
Harbor Island involved an illegal penalty contained in a commercial lease. The lease provided that the tenants would pay $96,364.80 per month, but $48,182.40 of that would be “conditionally ‘deferred’” and forgiven if the tenants perfectly complied with the lease. (Harbor Island, supra, 107 Cal.App.4th at p. 793.) The landlord sued, claiming the tenants breached the lease by failing to maintain the premises. (Ibid.) The jury found the tenants liable for approximately $14,000 in property damage. (Id. at p. 794.)
On appeal, the Harbor Island court held the landlord could not recover $240,912 in “conditionally deferred” rent because it was an illegal penalty. It stated, “[T]he lack of a proportional relationship between the $240,912 amount sought and the actual damages [the landlord] suffered on account of the breach of the covenant to maintain and repair [i.e., $14,000] could not be more obvious.” (Harbor Island, supra, 107 Cal.App.4th at p. 797.) The court noted the landlord “was perfectly willing to rent the property” for the $48,182.40 per month, yet “upon the slightest imperfection in the performance of [the tenants], it wanted nearly a quarter of a million dollars more for the same period of time.” (Ibid.) And it rejected the landlord’s contention “the actual loss was the amount of the rent that was conditionally deferred in anticipation of perfect performance.” (Id. at p. 798.) “‘A forfeiture or unreasonable penalty, imposed only upon the other party’s default, is unenforceable even though the same money, property or other consideration might have validly been bargained for as a form of contractual performance.’” (Id. at pp. 798-799.)
Here, the agreement imposes an unreasonable penalty similar to that imposed in Harbor Island. Like the Harbor Island landlord, BII “was perfectly willing to rent the property” for $75,000 per month, yet “upon the slightest imperfection in the performance of [AWI], ” BII instead wanted $120,000 each month, retroactive to March 2004. (Harbor Island, supra, 107 Cal.App.4th at p. 797.) This amount bears “no reasonable relationship to the range of actual damages that the parties could have anticipated would flow from a breach” of the agreement. (Ridgley, supra, 17 Cal.4th at p. 977.) For example, if AWI had breached the agreement by failing to make one monthly payment of $75,000, BII’s actual damages would have been the $75,000 that it had agreed to accept. And if AWI had breached the agreement by holding over for one month, BII’s actual damages would have been the $120,000 it could have reasonably received from another tenant for that one month - not $45,000 more for each month for the life of the agreement, plus $120,000 for each month BII owned the facility before the agreement. The parties could not reasonably anticipate that any breach of the agreement by AWI would cause damage of that magnitude.
Had BII wanted AWI to pay monthly rent of $120,000 going back to March 2004, it should have contracted accordingly. BII cannot now demand that amount simply because AWI committed some breach. “‘A forfeiture or unreasonable penalty, imposed only upon the other party’s default, is unenforceable even though the same money, property or other consideration might have validly been bargained for as a form of contractual performance.’” (Harbor Island, supra, 107 Cal.App.4th at pp. 798-799.)
But even though BII cannot recover the “full and fair” $120,000 monthly rental value retroactively to March 2004, BII may still recover its actual damages for injury caused by AWI’s breach. (See Harbor Island, supra, 107 Cal.App.4th at pp. 794, 800 [affirming judgment awarding landlord its actual damages]; see also Greentree, supra, 163 Cal.App.4th at p. 502 [implying penalty provisions are severable].)
The evidence at trial sufficiently supports the $689,945 contract damage award. First, the record shows AWI injured BII by failing to vacate the facility at the end of the license term - it held over after January 31, 2005 by leaving equipment, various materials, and contamination. BII sold the equipment and cleaned up the facility by July 2005, “plus or minus a month.” Thus, the jury could have reasonably found AWI breached the contract by occupying the facility until August 2005. Second, the record shows $120,000 was a reasonable monthly rental value for the facility. BII’s expert appraiser testified the fair rental value of the Brea facility was “around [$]113[, 000] or $114,000 a month, and that would compare with that $120,000. I mean, [the difference is] less than two cents a square foot overall.” AWI’s expert appraiser agreed the fair monthly rental value would be “something around [$]109[, 000] or [$]110, 000.” Thus, the jury could have reasonably found AWI’s failure to vacate the facility caused actual damages - not liquidated damages - of up to $120,000 per month for seven months: a maximum of $840,000. And so the jury could have reasonably awarded $689,945 in contract damages to compensate BII “for all the detriment proximately caused” by AWI’s breach. (§ 3300.)
This testimony, which the jury apparently credited, rebuts AWI’s claim that BII “was able to market the property on approximately July 1, 2005.”
In addition, AWI includes the $30,967 conditional storage fee in its calculation of BII’s recoverable contract damages.
BII May Recover the Non-duplicative Trespass Damages
AWI contends the trespass damages duplicate the contract damages. This is true in part. The jury awarded trespass damages of $840,000 to compensate BII for the facility’s $120,000 monthly rental value for the seven months during which AWI left equipment, materials, and contamination at the facility after the license term expired. (See Newhall Land & Farming Co. v. Superior Court (1993) 19 Cal.App.4th 334, 345 [trespass shown by “continued presence” of contaminants on property].) But the jury also awarded $689,945 in contract damages that can be upheld only as compensation for the same holdover injury, as shown above. Thus, the first $689,945 of the trespass damages duplicate the contract damages. BII may recover the remaining $150,055 in trespass damages.
BII notes the court instructed the jury with a version of CACI No. 361, which directed it not to award duplicative damages for contract, trespass, and negligence. Whatever the jury’s subjective reasoning may have been, its contract damages award may be upheld only as compensating BII for injury caused by AWI’s failure to vacate the facility - which duplicates the trespass damages.
AWI wrongly contends section 1.6 of the agreement bars recovery of any trespass damages. That section is entitled “Insurance, ” and requires AWI to obtain “property/casualty insurance” for the equipment and “general liability insurance” for accidents related to the equipment or AWI’s conduct at the facility. It also addresses AWI’s indemnity obligations to BII. It provides, “AWI shall[] indemnify, defend and hold BII harmless from and against all damages, claims, and liability for damage to property or liability for personal injury arising from the negligence or intentional acts or omissions after the date of this Agreement... in AWI’s use of and/or activities from and upon the Property, without regard to the limits of any insurance that AWI may have in place respecting the Equipment, the Property or AWI’s activities thereon.” The next sentence provides: “In no event shall AWI be liable for (i) any consequential, speculative or punitive damages (including, without limitation, any claims for lost profits or lost business opportunities) and (ii) the condition of the Property as of, or damages to the Property before, the execution of this Agreement.”
The contract provides that titles are for convenience only.
AWI claims trespass damages compensating BII for the facility’s reasonable rental value after the license term expired would constitute precluded damages for “lost profits or lost business opportunities.” But these cherry-picked words do not support AWI’s construction. We construe the contract independently - counsel for both parties agreed at oral argument no extrinsic evidence was admitted on the interpretation of section 1.6. “The whole of a contract is to be taken together... each clause helping to interpret the other.” (§ 1641.) Section 1.6 sets forth AWI’s extensive indemnity obligations to BII (“all damages, claims, and liability”), but the very next sentence limits these obligations. It absolves AWI from indemnifying BII against third-party claims of “lost profits or lost business opportunities.” Section 1.6 does not bar BII from recovering the facility’s reasonable rental value in the event AWI itself trespasses by leaving equipment, materials, and contamination after the license term. Any other interpretation would grant AWI an option to make the storage license perpetual.
BII May Recover the Negligence Damages
AWI contends the negligence damages duplicate the contract damages. AWI notes that in closing argument, BII’s counsel argued AWI acted negligently by unreasonably failing to “obey [the] contract” and diligently remove the equipment. To be sure, BII cannot “tortify” AWI’s contract breaches by framing them as negligent performance; nor may it recover in contract and tort for the same injury. “‘[C]ourts will generally enforce the breach of a contractual promise through contract law, ’” and “the mere negligent breach of a contract” will not ordinarily sound in tort. (Erlich v. Menezes (1999) 21 Cal.4th 543, 552 (Erlich).) “If every negligent breach of a contract gives rise to tort damages the limitation would be meaningless, as would the statutory distinction between tort and contract remedies.” (Id. at p. 554.)
But BII proved AWI negligently contaminated the facility with oil and other materials, which cost BII at least $300,000 to clean up. AWI owed an independent, noncontractual duty to BII not to negligently contaminate the facility. “[C]onduct amounting to a breach of contract becomes tortious only when it also violates a duty independent of the contract arising from principles of tort law.” (Erlich, supra, 21 Cal.4th at p. 551.)
AWI contends BII cannot recover the entire $300,000 in damages. It claims BII’s witness “conceded at trial that there were environmental hazards on the Brea property even before BII’s ownership, ... and that BII was responsible for the ‘majority’ of the contaminants.” It relies upon a snippet of testimony in which the witness agreed BII is “not asking this jury for the whole $300,000.” AWI also relies upon the following testimony, emphasis supplied by AWI: “Majority of the $300,000 was from oil in the pits and related oil and solvents and fluids that were there along with barrels that AWI clearly did not place there, that we wouldn’t be looking for them to reimburse us for.”
AWI takes the witness’s testimony out of context. The witness initially testified the cost of “the remediation alone was three or [$]400, 000.” BII’s counsel then tried to get the witness to state a floor for the remediation costs: “Can you give me a number that you can tell me it was no lower than X dollars, so the jury knows, look, at least we incurred that much?” Counsel then reviewed bills and invoices with the witness. The witness agreed with counsel, “to get this property in a position where you could show it costs [BII] more than $300,000 after [AWI] left.” The witness stated, It is “safe to say I know we spent at least $300,000 on the environmental portion” of the clean up. He continued, “If you wanted to use a minimum, you could say that the minimum costs in this property would be that $300,000. Certainly costs us more than that with the other stuff that had to be removed. But if that was the minimum you’re looking for, that’s the one I’d use.”
So the witness testified $300,000 was the “minimum” amount of clean up costs that could have totaled as much as $400,000. And once AWI’s carefully placed italics are omitted from the witness’s testimony, it becomes clear he testified the “[m]ajority” of the clean up costs were due to “oil in the pits and related oil and solvents and fluids” attributable to AWI - “along with barrels that AWI clearly did not place there, that we wouldn’t be looking for them to reimburse us for.” The witness did not concede the “[m]ajority” of the “oil in the pits and related oil and solvents and fluids” were unconnected to AWI. Given his testimony as a whole, the jury could reasonably conclude $300,000 would “compensate [BII] for all the detriment proximately caused” by AWI’s negligence. (§ 3333.)
Finally, the negligence damages do not run afoul of section 1.6. That section absolves AWI from indemnifying BII against third party claims arising from “the condition of the Property as of, or damages to the Property before, the execution of this Agreement.” It permits BII to recover its own costs incurred in cleaning up the facility due to AWI’s negligence.
BII May Not Recover the Fraud Damages
AWI contends BII cannot recover both contract and fraud damages. BII claims “[t]he jury awarded damages for fraud because, among other things, AWI lied about the removal of the equipment and the condition of the Property.” BII notes “AWI was aware of the flooding condition and environmental hazards of the Property at the time it entered into the Storage Agreement with BII yet failed to notify BII of these facts.” Thus, BII is claiming AWI’s misrepresentations caused it to incur remediation costs. The fraud damages are therefore duplicative of the negligence damages. No uncompensated injury remains to justify fraud damages.
The similarity between the fraud ($279,970) and negligence ($300,000) damages suggests they compensate the same injury. The record suggests no other basis for the amount of fraud damages. BII conceded in its posttrial briefing “it is not currently clear precisely how the jury calculated [the fraud] damage amount.”
AWI contends the court erred by omitting fraud from the jury instruction (CACI No. 361) prohibiting duplicative damages for breach of contract, trespass, and negligence. Any instructional error is now harmless.
BII May Not Recover the Conspiracy Damages
AWI claims the $1.6 million in conspiracy damages duplicate the underlying tort damages. “Conspiracy is not a cause of action, but a legal doctrine that imposes liability on persons who, although not actually committing a tort themselves, share with the immediate tortfeasors a common plan or design in its perpetration.” (Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 510-511.) “Standing alone, a conspiracy does no harm and engenders no tort liability. It must be activated by the commission of an actual tort. ‘“A civil conspiracy, however atrocious, does not per se give rise to a cause of action unless a civil wrong has been committed resulting in damage.”’” (Id. at p. 511.)
The conspiracy damages duplicate the other damages BII recovered. The special verdict form directed the jury to award conspiracy damages only if it found “AWI conspire[d] with a third party to commit any of the foregoing six (6) acts” - namely, that AWI breached a contract or committed trespass, negligence, fraudulent inducement, fraud, or waste. But the jury awarded separate damages to BII for AWI’s breach of contract, trespass, negligence, fraudulent inducement, fraud, and waste. Even if AWI conspired with a third party to commit those acts, the jury was not asked to find and the record does not reveal any independent harm caused by the conspiracy. As with the fraud damages, no uncompensated injury justifies conspiracy damages.
BII points to Titan’s acts in a futile attempt to preserve its conspiracy damages. It claims the record shows Titan and AWI conspired to “prevent[] BII from conducting its sale of the Equipment... and then utilize[d] Titan to remove and sell the Equipment to prevent BII from selling the Equipment.” It also claims the record showed Titan and AWI conspired to “illegally [bring] steel and raw materials onto the Property to manufacture wheels as well as ‘kitty litter’ and barrels and other materials.” Even if so, BII has been compensated for any damage to the facility, the delay caused by foregoing the June 2004 auction, and the failure to remove the equipment with damages for negligence, breach of contract, and trespass - damages still amounting to $1.14 million. No additional, uncompensated injury appears.
BII claims jurors told it the conspiracy damages “represent[] one-half of the amount that BII might have recovered but for AWI’s conspiracy with Titan to fraudulently prevent BII from proceeding with the June 18, 2004 auction....” BII offers no evidence or authority to support this claim. It does not offer the juror statements, which is just as well because they are inadmissible. (See Mesecher v. County of San Diego (1992) 9 Cal.App.4th 1677, 1684 [excluding statements recounting “the reasoning process of the jurors during deliberations”].) And the sale proceeds from an abandoned property auction belong to the tenant - in this case, AWI. (§ 1988, subd. (c).) The landlord may deduct reasonable storage and auction costs, but it cannot force the tenant to go “halfsies.” (Ibid.) Even if AWI conspired with Titan to torpedo the June 2004 auction, the judgment (after remand) will compensate BII for any resulting harm with $1.14 million in recoverable contract, trespass, and negligence damages.
“After deduction of the costs of storage, advertising, and sale, any balance of the proceeds of the sale which is not claimed by the former tenant or an [abandoned property] owner... shall be paid into the treasury of the county in which the sale took place not later than 30 days after the date of sale.” (§ 1988, subd. (c).)
BII May Recover Punitive Damages
BII cross-appeals to challenge the order declining to award punitive damages. The jury found AWI acted with malice, fraud, or oppression, opening the door for a punitive damages award. The parties stipulated the court would determine the amount of punitive damages in a separate phase. After the hearing, the court issued a minute order declining to award punitive damages. It found “[s]ection 1.6 unequivocally bars [BII] from obtaining any punitive damages from [AWI], ” noting it provided: “‘In no event shall AWI be liable for (i) any... punitive damages....’”
The quoted sentence of section 1.6 relates to the preceding sentence that imposes indemnity obligations upon AWI, as already seen in the discussion of section 1.6’s effect, or lack thereof, on the trespass cause of action. Taken as a whole, section 1.6 provides that AWI does not have to indemnify BII for any punitive damages awarded against BII in litigation with a third party over injury caused by the equipment or AWI’s conduct at the facility during the license term. It does not immunize AWI from paying punitive damages for its own tortious conduct. The court must vacate its order and determine what punitive damages, if any, to award BII.
The Order Declining to Amend the Complaint is Moot
BII also cross-appeals a liability phase order denying leave to amend the complaint to add Titan as a defendant. It contended Titan should be named a defendant because AWI was its alter ego. BII acknowledges the court found in a postjudgment proceeding that AWI was Titan’s alter ego and ordered Titan added to the judgment as a judgment debtor. AWI and Titan each challenge the alter ego finding in pending consolidated appeals. (Case Nos. G041803, G042153, G041926, & G042148.)
We grant BII’s request to take judicial notice of these notices of appeal, letter briefs regarding consolidation, and our own consolidation order.
BII contends its appeal from this order is “protective.” In truth, it is moot. If we affirm the order adding Titan as a judgment debtor, then BII is not aggrieved by the order denying leave to amend - Titan is still a judgment debtor. If we reverse the order adding Titan as a judgment debtor, then we will have held Titan is not AWI’s alter ego, and so denial of leave to amend is harmless. The order denying leave to amend simply does no work in this case anymore.
The Discovery Sanctions Were Not Arbitrary
Finally, BII half-heartedly challenges the court’s decision to punish AWI’s discovery abuses with only $15,000 in monetary sanctions, and not evidentiary or terminating sanctions. “‘The power to impose discovery sanctions is a broad discretion subject to reversal only for arbitrary, capricious or whimsical action.’ A decision to impose the ultimate sanction - a judgment in the opposing party’s favor - should not be made lightly. ‘But where a violation is willful, preceded by a history of abuse, and the evidence shows that less severe sanctions would not produce compliance with the discovery rules, the trial court is justified in imposing the ultimate sanction.’” (Parker v. Wolters Kluwer United States, Inc. (2007) 149 Cal.App.4th 285, 297, fn. omitted.) BII has failed to show the history of willful abuse or the inadequacy of less severe sanctions necessary to show the court’s decision to impose only monetary sanctions was arbitrary.
DISPOSITION
The judgment is reversed. The matter is remanded to the court with directions to: (1) vacate its order declining to award punitive damages, and (2) enter a new judgment identical to the prior judgment except it shall (a) reduce the damages on the trespass cause of action to $150,055, (b) award no damages on the fraud cause of action, (c) award no damages on the conspiracy cause of action, and (d) award whatever punitive damages, if any, the court finds are supported by the record.
AWI shall recover its costs on appeal.
WE CONCUR: BEDSWORTH, ACTING P. J., FYBEL, J.