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Chevrolet v. Hardesty

California Court of Appeals, First District, Fifth Division
Apr 30, 2010
No. A124900 (Cal. Ct. App. Apr. 30, 2010)

Opinion


SONOMA COUNTY CHEVROLET, v. JOHN HARDESTY et al., A124900 California Court of Appeal, First District, Fifth Division April 30, 2010

NOT TO BE PUBLISHED

Sonoma County Super. Ct. No. SCV240104

Jones, P.J.

In 2006, John Hardesty was the president of Esposti Chevrolet, a General Motors dealership, in Sonoma. GMAC Financial Services (GMAC) held a $314,429 lien on 16 of the dealership’s used cars. Esposti Chevrolet could not sell the cars and GMAC had tried, unsuccessfully, to sell them at an auction.

In May 2006, Dan Roseland, Larry Green, and Rob Green purchased Esposti Chevrolet and renamed it Sonoma County Chevrolet (Sonoma Chevrolet). In October 2006, Roseland and Hardesty agreed that Sonoma Chevrolet would pay off the lien on the used cars and sell them within a prescribed time period. In exchange, Hardesty agreed to pay Sonoma Chevrolet if the cars sold for less than the amount of the lien. Pursuant to the agreement, Sonoma Chevrolet paid the lien obligation and sold the cars in early 2007 for $191,900. Hardesty, however, refused to pay Sonoma Chevrolet for the losses it incurred on the sale of the cars. Sonoma County sued Hardesty and Esposti Chevrolet (collectively, Hardesty) for breach of contract. Following a bench trial, the court granted judgment for Sonoma Chevrolet.

Hardesty appeals. He contends: (1) the court abused its discretion by denying his motion to continue the trial; (2) there was insufficient evidence to support the court’s determination that a “sale” occurred; and (3) the court erred by denying his motion for new trial.

We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

In May 2006, Roseland and Larry and Rob Green agreed to purchase Esposti Chevrolet. At that time, Roseland and Hardesty also discussed what to do with the 16 used cars Hardesty had been unable to sell. A few months later, in October 2006, Roseland and Hardesty executed an agreement regarding the used cars. In the agreement, Sonoma Chevrolet agreed to pay off the $314,429 lien and sell the used cars within 10 days after the close of escrow on the dealership. In exchange, Hardesty would be responsible for any losses Sonoma Chevrolet incurred if the cars sold for less than $314,429.

Pursuant to the agreement, Sonoma Chevrolet paid the lien obligation and contacted three car wholesalers to obtain bids for the used cars. None of the wholesalers, however, submitted bids. On November 10, 2006 - 10 days after escrow closed - Roseland wrote Hardesty’s attorney to inquire about Hardesty’s “intentions with respect to these 16 used vehicles.” According to Roseland, Hardesty had expressed “his desire to sell the vehicles himself.” Hardesty’s attorney did not respond to Roseland’s letter.

Hardesty had executed a power of attorney authorizing his attorney, Herbert Terreri, to act on Hardesty’s behalf.

Shortly thereafter, Sonoma Chevrolet received three wholesale bids for the used cars. The bids ranged from $196,900 to $221,300. One of the bids was from Eric Nielsen, a wholesaler in Arizona. Sonoma Chevrolet forwarded the bids to Terreri, but he did not respond. Roseland called Hardesty several times; when he finally reached Hardesty, Hardesty said, “‘[We’ve] got nothing to talk about’” and hung up on Roseland. A short time later, Roseland contacted Terreri again regarding the bids. Terreri did not respond.

By January 2007, Roseland had still not heard from Hardesty about the bids. On January 8, 2007, Roseland called Nielsen “in an effort to dispose of these vehicles, which [he] desperately had to do.” Nielsen offered to purchase the cars for $191,900 and Roseland agreed. Roseland prepared the bills of sale and shipped the cars and the titles to Arizona. Sonoma Chevrolet received $191,900 for the cars. Later, Roseland learned that Nielsen refused to accept the cars when they arrived in Arizona and that Larry Green’s dealership “had to end up taking” them. Hardesty failed to pay Sonoma Chevrolet for the loss it incurred on the sale of the cars and Sonoma Chevrolet sued Hardesty for breach of contract. Sonoma Chevrolet identified Nielsen as a witness during discovery.

Roseland shipped the cars to Larry Green Chevrolet and not directly to Nielsen to minimize shipping costs. In addition, Green’s dealership “was very close to [Nielsen], where [Nielsen] could easily get the vehicles one at a time[.]”

Hardesty filed a cross-complaint. Neither the complaint nor the cross-complaint is part of the record on appeal.

On October 24, 2008 - the morning of trial - Hardesty moved to continue the trial to “conduct additional discovery concerning newly discovered matters[.]” Hardesty claimed that he learned on October 21, 2008 that “the used cars at issue in this case” were purchased by Larry Green and not “by the third party that [Sonoma Chevrolet] claimed to have sold them to.” Hardesty requested additional time to conduct discovery, contending Sonoma Chevrolet’s “self-dealing and fraud ha[d] an important bearing on the trial of this case and g[a]ve rise to additional causes of action and potential [ ] punitive damages.” In a declaration filed in support of the motion, Hardesty’s attorney, Terreri, averred that he spoke to Nielsen on October 21, 2008 “for the purpose of getting the purchasing dealer’s impression of the condition of the vehicles for [Hardesty’s] expert’s consideration.” According to Terreri, Nielsen admitted during their conversation that he did not purchase the cars.

In opposition, Sonoma Chevrolet stated it identified Nielsen during discovery and that Hardesty did not call Nielsen until the week before trial. At the hearing on the motion, Terreri conceded he had known of “the witness in question” since December 2007. The court denied the motion to continue, concluding Hardesty had not demonstrated good cause to continue the trial date.

Following a bench trial, the court awarded judgment for Sonoma Chevrolet. In its statement of decision, the court concluded Hardesty breached the October 2006 agreement by refusing to pay Sonoma Chevrolet “for the losses it incurred on the sale of the used vehicles.” The court determined there was evidence the cars were sold. As the court explained, “the fact that 15 of the vehicles were ultimately taken by a separate dealership owned by Larry Green is of little or no legal consequence, given the fact that the payment amount received by [Sonoma Chevrolet] was made based on independent, good faith bids, including that of Eric Nielsen. The Court further finds that there is indeed evidence that the vehicles were sold. In good faith, Mr. Roseland prepared and shipped bills of sale with each of the vehicles. Consideration was received for the sale of the vehicles... [Sonoma Chevrolet] did not retain any interest in the vehicles.... Bills of sale prepared by Mr. Roseland and Mr. Roseland’s testimony are sufficient evidence to convince the Court the vehicles were sold and Sonoma County Chevrolet, Inc. incurred losses for which Mr. Hardesty was obligated to pay.” Finally, the court determined the contract did not contain an explicit provision requiring Hardesty to consent to the sale of the vehicles.

In its tentative ruling, the court concluded neither Roseland nor Green “did anything remotely resembling fraud” because the bids from the wholesalers “were from strangers! The sale to Eric Nielsen in Arizona was completely in good faith....” The court also stated it had “no difficulty awarding judgment for [Sonoma Chevrolet]...”

The court denied Hardesty’s motion for new trial and Hardesty appealed.

DISCUSSION

The Denial of Hardesty’s Request for a Continuance Was Not an Abuse of Discretion

Hardesty contends the court abused its discretion by denying his request to continue the trial so he could conduct additional discovery regarding the sale of the cars. In civil cases, “continuances of trials are disfavored.” (Cal. Rules of Court, rule 3.1332(c).) As a result, a trial court “may grant a continuance only on an affirmative showing of good cause requiring the continuance.” (Cal. Rules of Court, rule 3.1332(c).) A party’s “excused inability to obtain... material evidence despite diligent efforts” may constitute good cause for a continuance. (Cal. Rules of Court, rule 3.1332(c)(6).)

We review the court’s ruling on the motion to continue for an abuse of discretion. (Jensen v. Superior Court (2008) 160 Cal.App.4th 266, 271; Forthmann v. Boyer (2002) 97 Cal.App.4th 977, 984.) “Discretion is abused when a decision is arbitrary, capricious or patently absurd and results in a manifest miscarriage of justice.” (In re Karla C. (2003) 113 Cal.App.4th 166, 180.) Accordingly, appellate courts “usually uph[o]ld” the trial court’s “exercise of discretion in denying a continuance[.]” (7 Witkin, Cal. Proc. (5th ed. 2008) Trial, § 10, p. 37, original italics.)

Hardesty has not established an abuse of discretion. As noted above, Hardesty moved to continue the trial date on the morning of trial, claiming Sonoma Chevrolet failed to disclose evidence regarding the sale of the used cars. But at the hearing on the motion, Hardesty’s attorney admitted that Sonoma Chevrolet identified Nielsen during discovery. By waiting until just three days before trial to contact Nielsen, Hardesty failed to make “diligent efforts” to obtain the evidence. (Cal. Rules of Court, rule 3.1332(c)(6); see also In re Automobile Antitrust Cases I & II (2005) 135 Cal.App.4th 100, 127 [trial court did not abuse its discretion by denying motion to continue trial to conduct additional discovery].) As a result, Hardesty failed to demonstrate good cause for a continuance and the court properly denied his last-minute motion to continue. (Cal. Rules of Court, rule 3.1332(b), (c)(6); Mahoney v. Southland Mental Health Associates Medical Group (1990) 223 Cal.App.3d 167, 172 [trial court properly denied motion to continue hearing; among other things, counsel “failed promptly to request a continuance upon ascertaining the need therefor...”].)

Hardesty’s Substantial Evidence Argument Fails

Next, Hardesty contends the court’s finding of a “sale” of the used cars is “unsupported by the evidence[.]” Hardesty’s argument is difficult to follow, but he seems to contend Sonoma Chevrolet did not “sell” the used cars because Larry Green, Roseland’s business partner, purchased them.

This argument has no merit. The October 2006 agreement required Sonoma Chevrolet to repay the lien and sell the cars within a specified time period. The agreement also required Hardesty to “pay [ ] Sonoma Chevrolet for any losses incurred upon the sale of those 16 used vehicles.” Sonoma Chevrolet performed on the contract by selling the cars to Green. A sale is “[t]he transfer of property or title for a price.” (Black’s Law Dict. (8th ed. 2004) p. 1364; see also Merriam-Webster’s Collegiate Dict. (11th ed. 2004) p. 1097 [defining “sale” as “the transfer of ownership of and title to property from one person to another for a price”].) Roseland testified that Sonoma Chevrolet transferred the cars and their respective titles to Larry Green in exchange for $191,900. As a result, the trial court’s determination that Sonoma Chevrolet sold the cars is supported by substantial evidence. (Bowers v. Bernards (1984) 50 Cal.App.3d 870, 873.)

Hardesty repeatedly contends there was no “third party sale such that [Sonoma Chevrolet] has any right to demand payment” from him. But this argument misses the point. The used car agreement did not - as the lower court correctly observed - require Hardesty to consent to the sale, nor did the agreement impose any restrictions on the buyer Sonoma Chevrolet selected.

Hardesty’s reliance on Enea v. Superior Court (2005) 132 Cal.App.4th 1559, 1563 (Enea) is unavailing. In that case, the court held that the defendants in a partnership violated their fiduciary duties to another partner by renting the partnership’s office building to themselves at below fair market value. (Id. at p. 1563.) Enea is completely distinguishable because this case does not involve a breach of a fiduciary duty between partners. Hardesty was not Roseland’s partner and Hardesty did not raise a breach of fiduciary claim in the lower court.

Hardesty Has Waived His Claim Regarding the Denial of His New Trial Motion

Finally, Hardesty claims the court abused its discretion by denying his new trial motion. He does not support his contention with argument or authority. “The absence of cogent legal argument or citation to authority allows this court to treat the contentions as waived.” (In re Marriage of Falcone & Fyke (2008) 164 Cal.App.4th 814, 830; Lester v. Lennane (2000) 84 Cal.App.4th 536, 594 [“[a] claim of legal error unsupported by authority is waived”]; see also Cal. Rules of Court, rule 8.204(a)(1)(B) [each point must be supported “by argument and, if possible, by citation of authority”].)

DISPOSITION

The judgment is affirmed. Sonoma Chevrolet shall recover its costs on appeal.

We concur: Simons, J., Bruiniers, J.


Summaries of

Chevrolet v. Hardesty

California Court of Appeals, First District, Fifth Division
Apr 30, 2010
No. A124900 (Cal. Ct. App. Apr. 30, 2010)
Case details for

Chevrolet v. Hardesty

Case Details

Full title:SONOMA COUNTY CHEVROLET, v. JOHN HARDESTY et al.,

Court:California Court of Appeals, First District, Fifth Division

Date published: Apr 30, 2010

Citations

No. A124900 (Cal. Ct. App. Apr. 30, 2010)