Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County, Leon S. Kaplan, Judge, No. LC027260
Allen Law Corp, James G. Allen and Sean D. Allen for Plaintiff and Appellant.
Weissmann Wolff Bergman Coleman Grodin & Evall, Marvin Gelfand and Steven H. Glaser for Defendants and Respondents Kona Coast Properties, LLC., David Jacobs and Norman Carabet.
No appearance for Defendant and Respondent James Highfill.
MANELLA, J.
The parties to this appeal formed a limited liability company (LLC). Appellant Helmi El Senoussi contends that he is entitled to compensation under the terms of the parties’ operating agreement. We conclude his argument is inconsistent with the plain language of the agreement. Appellant further asserts that the trial court erred in denying his motion to disqualify the attorney representing the company and two of its members. He did not immediately appeal from the order denying his motion to disqualify and his challenge to that order is not reviewable in this appeal. We affirm.
Appellant did not include the order denying his motion to disqualify in the record on appeal. We obtained it from the Superior Court and take judicial notice of it. (Evid. Code, §§ 459, subd. (a), 452 subd. (d).)
FACTUAL AND PROCEDURAL BACKGROUND
In January or February of 2004, appellant, a general contractor, entered escrow on three parcels of real property in Hawaii. His intent was to find investors to purchase the lots, after which he would cause the lots to be developed and sold for profit. Appellant represented to then-potential investors Norman Carabet, David Jacobs, and James Highfill that he would manage all construction and would cause the houses to be built on the three properties in approximately 12 months. According to appellant, Carabet, Jacobs, and Highfill were to provide funds and he was to oversee construction of the houses on each lot. Carabet, Jacobs, and Highfill each purchased one lot, and together with appellant, they formed the Kona Coast Properties, LLC (Kona) in July 2004.
Carabet signed the agreement as Trustee of the Norman Carabet, M.D. trust UTA 3/30/84. Because no issue with respect to the trust is raised on appeal, we use Carabet’s name in lieu of the trust for simplicity.
1. Kona’s Operating Agreement
On July 13, 2004, appellant, Carabet, Jacobs, and Highfill entered into an operating agreement governing Kona and identifying appellant, Carabet, Jacobs, and Highfill as “Members.” The parties agreed that appellant’s capital contribution would consist of specified services to the LLC. Exhibit C to the operating agreement describes the parties’ capital contributions: Carabet contributed $584,004; Jacobs contributed $567,578 and Highfill contributed $525,216. Appellant contributed $0.00 and was to “be responsible for supervising all development, demolition and construction activities engaged in by the Company for the Initial Project.” Exhibit C further provided that appellant “shall devote such time to these activities as is necessary for the proper management of all such activities for the Initial Project. As compensation for such services, [appellant] shall, upon completion of the project, be credited with an equal share of the profits and losses after each Member’s capital contribution has been repaid and reduced to zero.”
Appellant’s contribution of services is consistent with Corporations Code section 17200, which provides that the “contribution of a person may be in money, property, or services, or other obligation to contribute money or property or to render services.”
Section 9.1.1 of the operating agreement provided that Kona was to be dissolved upon the first to occur of the following events: “The death, incapacity, bankruptcy, withdrawal, or dissolution of a Member, provided, however, that the remaining Members may[,] by the Vote of a Majority of Members within 90 days of the happening of that event[,] Vote to continue the business of the Company, in which case, the Company shall not dissolve. If the remaining Members fail to so Vote, the remaining Members shall wind up the Company.”
Section 4.4.1, the sole provision in the operating agreement under the heading “Liquidation and Dissolution,” provided: “Upon liquidation of the Company, the assets of the Company shall be distributed to the Members in accordance with the positive balances in their respective Capital Accounts, after giving effect to all Contributions, Distributions, and allocations for all periods. Distributions to the Members pursuant to this Section 4.4.1 shall be made in accordance with Regulation Section 1.704-1(b)(2)(ii)(b)(2).”
The operating agreement does not provide the full cite for section 1.704-1(b)(2)(ii)(b)(2). We presume the parties are referring to 26 Code of Federal Regulations part 1.704-1, which concerns foreign taxes.
2. Kona is Dissolved
There is no dispute that Highfill could not make the contributions demanded by Kona. As a result, on March 31, 2005, Carabet and Jacobs executed an agreement to buy out Highfill. Eventually, Jacobs, Carabet, and Highfill took possession of the individual properties representing their respective capital contributions. On appeal, there is no dispute that the dissolution of Kona was triggered under section 9.1.1.
This agreement is not included in the record on appeal.
3. Appellant Sues and a Court Trial Ensues
On October 11, 2005, appellant sued Kona, Jacobs, Carabet, and Highfill, alleging causes of action for dissolution, partition, and an accounting.
Jacobs and Carabet filed a cross-complaint, which they dismissed without prejudice.
In his verified complaint, appellant alleged that his “Capital Contribution to Kona Coast was to consist entirely of construction and development services, of which plaintiff has already substantially performed.” Less than a month before the scheduled trial date, appellant moved unsuccessfully to disqualify Marvin Gelfand, the attorney for Kona, Jacobs, and Carabet. His motion was denied October 18, 2006.
During the ensuing court trial, appellant testified he had not provided any capital to the company but had spent 2,000 hours working on projects for Kona. In June 2005, when the LLC ended, there was a construction schedule, along with estimates and bids. Appellant testified that plans for the development of Highfill’s lot were approved in 2006. Plans for Carabet’s lot (which were included in the sale of the lot) were approved in June 2005, and plans for the development of Jacobs’s property were approved the following month. Appellant acknowledged that at the time he filed his complaint, none of the projects had been completed.
4. Trial Court Findings
The court found that pursuant to section 9.1.1 of the operating agreement, Kona was dissolved 90 days after March 31, 2005, the effective date of the agreement to buy out Highfill. The court further found that the condition precedent to appellant’s entitlement to 25 percent of the operating profits, viz., completion of the project, did not occur as no houses were built on the three lots. There was no dispute over the language of the operating agreement, and the court emphasized that it was “clear, unambiguous, and do[es] not contain language which is subject to [a] differing interpretation.” Appellant timely appealed from the judgment.
DISCUSSION
We conclude the trial court correctly found that the operating agreement contains a condition precedent to appellant’s sharing in the profits of the business venture, namely, the completion of the project. Because the project was not completed when the company dissolved, appellant’s entitlement to share in the profits never arose under the terms of the agreement. We reject appellant’s claims that other contract provisions compel a different result or that he was prevented from completing his performance by the termination of Kona. We also reject his unsupported claim that he substantially performed and his argument that enforcing the operating agreement was unfair. Finally, we conclude that appellant’s argument that the trial court erred in declining to disqualify attorney Gelfand from representing the company and two of its members is not reviewable in this appeal from a final judgment.
1. Under the Relevant Provisions of the Operating Agreement, Appellant Was Not Entitled to Any Profits
The operating agreement provides in section 9.1.1 that the company shall be dissolved by the withdrawal of a member unless the majority of members within 90 days votes to continue the business of the company. Appellant admits that the other members “decided... [to] declare the LLC terminated.” On appeal, it is undisputed that under the terms of the operating agreement, the LLC was dissolved 90 days from March 31, 2005, as the trial court found.
Because the company was dissolved, the provision governing distribution upon dissolution was triggered. Section 4.4.1 of the operating agreement requires distribution “to the Members in accordance with the positive balances in their respective Capital Accounts, after giving effect to all Contributions, Distributions, and allocations for all periods.” Appellant had no positive balance in his capital account because, pursuant to exhibit C his capital contribution was “$0.00” and he was to be credited with a share of profits only “upon completion of the project.” The plain language is clear and appellant provides no contrary interpretation. (Ben-Zvi v. Edmar Co. (1995) 40 Cal.App.4th 468, 473 [“Where the parties have reduced their agreement to writing, their mutual intention is to be determined, whenever possible, from the language of the writing alone” paraphrasing Civ. Code, § 1639].) Because the completion of the project -- the condition precedent to appellant’s sharing in the profits and losses -- had not occurred, he was not entitled to any profits. (See 1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts, § 776, p. 866, italics omitted [“A condition is a fact, the happening or nonhappening of which creates (condition precedent) or extinguishes (condition subsequent) a duty on the part of the promisor”]; Civ.Code, § 1436 [“A condition precedent is one which is to be performed before some right dependent thereon accrues, or some act dependent thereon is performed”].)
There is no dispute that the project was not completed. Appellant testified that at the time he filed his action for dissolution none of the projects had been completed. His verified complaint indicates that the lots were “partially developed or wholly undeveloped....” His opening brief states that “Respondents’ election to terminate the LLC Agreement prior to completion of the development project prevented appellant from completing the balance of his capital contribution.”
None of the provisions of the operating agreement quoted by appellant governs the distribution of profits in the event of dissolution of the company or demonstrates that he is entitled to a share of profits prior to the completion of the project. Even assuming that a general provision in the operating agreement conflicted with the specific provision for distribution following dissolution, the general provision would not trump the specific provision, section 4.4.1. (Code Civ. Proc., § 1859 [written instrument’s particular provision is paramount to general provision]; McNeely v. Claremont Management Co. (1962) 210 Cal.App.2d 749, 753 [where general and particular contract provisions are inconsistent, particular controls general].)
Appellant’s claim that he was prevented from completing the project because “[r]espondents elect[ed] to terminate the LLC Agreement prior to completion of the development project” ignores the express contractual provision allowing for dissolution upon the “death, incapacity, bankruptcy, withdrawal, or dissolution of a Member” where no further vote by the members is taken. Following Highfill’s withdrawal, the terms of the operating agreement signed by appellant thus mandated dissolution in the absence of a further vote. In short, the trial court properly rejected appellant’s claim that under the terms of the operating agreement, he was entitled to a share of the profits upon the dissolution of the company.
2. Appellant’s Remaining Arguments Lack Merit
a. Substantial Performance
Appellant cites to no evidence in the record demonstrating he substantially performed his obligations under the operating agreement; his argument is therefore forfeited. (Placer County Local Agency Formation Com. v. Nevada County Local Agency Formation Com. (2006) 135 Cal.App.4th 793, 814 [“We need not address points in appellate briefs that are unsupported by adequate factual or legal analysis”].) The construction of the houses had not begun at the time of the dissolution, a fact negating appellant’s claim that he substantially performed his self-described responsibilities of building “residential structures on the properties” and “get[ting] the[] houses built.” In any event, the doctrine of substantial performance is inapplicable here because appellant did not sue for breach of contract. (See 1 Witkin, Summary of Cal. Law, supra, Contracts, § 818, p. 908 [doctrine of substantial performance allows for an action on the contract where complete performance was not rendered]; Denver D. Darling, Inc. v. Controlled Environments Construction, Inc. (2001) 89 Cal.App.4th 1221, 1238, fn. 8 [same].)
b. Fairness
Finally, appellant argues that it is unfair that he received no payment for the time and effort he invested into the project. However, appellant did not allege a cause of action for unjust enrichment. That doctrine applies where “‘one obtains a benefit which he may not justly retain....’” (McBride v. Boughton (2004) 123 Cal.App.4th 379, 388, fn. 6 quoting frmr. 1 Witkin, Summary of Cal. Law, supra, Contracts, § 91, p. 122.) Appellant fails to show how his fairness argument is relevant to any of his causes of action for dissolution, partition, and an accounting.
Appellant did not seek leave to amend the complaint when respondents pointed this out in their opening argument. And appellant fails to address or demonstrate any error in the trial court’s conclusion that no unfairness resulted from applying the terms of the operating agreement. The trial court concluded: “People have freedom to contract. You have one party who appears to be, according to the evidence, far more sophisticated than the other three, at least in the area of real estate development. There’s evidence by his own mouth that he had 30 years of experience. There’s no evidence that the others had any expertise whatsoever [in real estate].... And this individual with open eyes entered into an agreement that gave him an opportunity... to engage in new ventures in Hawaii.... He absolutely did not assume any of the liabilities whatsoever. Had the market tanked, had there been any kind of a loss, he was absolved of any responsibility for that.”
3. Appellant’s Failure to Seek Timely Review of the Court’s Denial of his Motion to Disqualify Attorney Gelfand Precludes Appellate Review
The October 18, 2006 order denying appellant’s motion to disqualify attorney Gelfand was immediately appealable. (Meehan v. Hopps (1955) 45 Cal.2d 213, 217 (Meehan) [order denying motion for disqualification “left nothing further of a judicial nature for a final determination of his rights regarding opposing counsel, [and] the order was final for purposes of appeal”]; Apple Computer, Inc. v. Superior Court (2005) 126 Cal.App.4th 1253, 1263-1264 [either writ petition or appeal may be filed following the denial of a motion to disqualify]; Roush v. Seagate Technology, LLC (2007) 150 Cal.App.4th 210, 218 [same].)
Contrary to appellant’s argument, both an order denying and an order granting a motion to disqualify are immediately appealable. In Meehan, the court provided two rationales for concluding that an order denying a motion to disqualify was immediately appealable. (Meehan, supra, 45 Cal.2d at pp. 215-218.) Although one of those rationales has been questioned, Meehan remains binding authority. (Machado v. Superior Court (2007) 148 Cal.App.4th 875, 883; see also Reed v. Superior Court (2001) 92 Cal.App.4th 448, 453, fn. 2.) In addition, subsequent authority has held that whether the order is appealable should not be based on whether it was granted or denied. (Muller v. Fresno Community Hospital & Medical Center (2009) 172 Cal.App.4th 887, 902.)
Upon final judgment, we cannot review an order from which a separate appeal might have been pursued. (Machado v. Superior Court, supra, 148 Cal.App.4th at p. 886 [order disqualifying counsel not reviewable from final judgment]; Sole Energy Co. v. Petrominerals Corp. (2005) 128 Cal.App.4th 212, 239 [“[i]f an order is appealable, an aggrieved party must file a timely notice of appeal from the order to obtain appellate review”]; Strathvale Holdings v. E.B.H., supra, (2005) 126 Cal.App.4th at p. 1248 [same]; Code Civ. Proc., § 906 [“The provisions of this section do not authorize the reviewing court to review any decision or order from which an appeal might have been taken”].) Because appellant could have immediately appealed from the order denying his motion to disqualify, we are precluded from reviewing his contention that the court erred in denying his motion to disqualify attorney Gelfand.
The notice of appeal specifies that the appeal is from the judgment and the “Order for Judgment pursuant to Code of Civil Procedure Section 631.8.” Contrary to counsel’s representation at oral argument, no reference is made to an order denying appellant’s motion for disqualification. Even if the October 18, 2006 order had been included in the notice of appeal filed April 4, 2008, the appeal from it would not have been timely. (Strathvale Holdings v. E.B.H. (2005) 126 Cal.App.4th 1241, 1248.)
As explained in Machado v. Superior Court, supra, 148 Cal.App.4th at pages 883-885, Haldane v. Haldane (1963) 216 Cal.App.2d 12, 13, which held that an order denying a motion to disqualify was not appealable, and In re Sophia B. (1988) 203 Cal.App.3d 1436, 1439, which considered a disqualification decision after final judgment, failed to apply our high court’s decision in Meehan v. Hopps, supra, 45 Cal.2d 213, and are not persuasive.
DISPOSITION
The judgment is affirmed. Respondents shall have their costs on appeal.
We concur: EPSTEIN, P. J., WILLHITE, J.