Opinion
NOT TO BE PUBLISHED
Super. Ct. No. CVCS062115.
ROBIE, J.
In this unlawful detainer action, landlords Johnny A. and Lora Lee Ribeiro sought to evict tenants LaRocca Vineyards, Philip LaRocca, and LaRocca Vineyards III from property Ribeiro owned on which LaRocca was growing grapes to make wine. As relevant here, Ribeiro sought possession of the property on the ground that LaRocca had “fail[ed] to account for wine sales and [make] payment” to Ribeiro based on those sales, as required by two written leases between the parties.
We will refer to Johnny Ribeiro individually and to both plaintiffs jointly as Ribeiro. We will use the name LaRocca to refer to Philip LaRocca individually, to both of the vineyard entities, and to all three defendants collectively.
The trial court found the parties had orally modified the written leases, and LaRocca had paid all sums due to Ribeiro under the modified agreements; therefore, Ribeiro had not proved breach of the pertinent provisions of the leases and was not entitled to possession of the property.
From the judgment in favor of LaRocca, Ribeiro appeals, contending: (1) the trial court erred in failing to determine various material issues in its statement of decision; and (2) there was no substantial evidence of an executed oral agreement modifying the written leases. Disagreeing with these contentions, we will affirm the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
In May 1994, Ribeiro and LaRocca entered into a 15-year written lease covering property Ribeiro owned in Sutter County on which LaRocca was growing grapes to make organic wines. Under the terms of the lease, LaRocca was to own the grapes and the wines made from them, and Ribeiro was to be paid as follows:
“7. [Ribeiro] shall receive 18% of the net profit from the sale of grapes grown on The Property and from the sale of the organic wines produced from the grapes grown on The Property as follows:
“(a) The net profit shall be calculated per calendar year. Grapes sales shall be calculated by the commercial standard ton. Wine sales shall be calculated by the case produced and sold.
“(b) [Ribeiro] shall be paid annually and in full by December 31st for (i) the table grapes sold from the crop harvested that calendar year and (ii) for the wine produced from the crop harvested the prior calendar year.
“(c) The Parties acknowledge that wine sales do not necessarily occur in the year following the harvest of the grapes. Therefore, [Ribeiro] shall be paid each year based on the anticipated net profit from the vine sales, which shall be adjusted each subsequent year as the wine from each harvest is sold.
“(d) The expenses of [LaRocca] which are to be deducted from the gross profit shall include, but are not limited to, equipment rental, utility costs, insurance, labor and other costs necessary to grow and harvest the grapes, to produce the wine and to place the product onto the retailer’s shelf. These expenses shall not include salaries for the [LaRocca] principals, office expense, equipment purchases, promotion or advertising.”
In May 1995, the parties entered into a similar 20-year written lease covering more property owned by Ribeiro and in the same vicinity. The payment provisions in the 1995 lease were similar to those in the 1994 lease, except that Ribeiro was to be paid his percentage of the wine sales “in the year of the sale based on the net profit from the wine sales, which shall be paid quarterly,” and “[a]n accounting of the net profit shall be provided consecutively with the payments.”
The parties later agreed that the 1994 lease covered “the acreage planted or grafted to all varieties of grapes other than chardonnay,” and the 1995 lease covered “the acreage planted or grafted to chardonnay.”
Both leases also contained provisions requiring LaRocca to maintain the property “in a good farm-like manner as is customary in the community,” and a substantial portion of this unlawful detainer action was taken up with litigating whether LaRocca had breached those provisions or had committed waste on the properties. The trial court ultimately concluded LaRocca had properly maintained the properties, and Ribeiro does not contest this aspect of the trial court’s ruling on appeal. Therefore, we limit ourselves to a discussion of the facts and arguments relating to what Ribeiro refers to as “the wine sale profits and accounting issues.”
LaRocca testified that notwithstanding the written leases, he and Ribeiro entered into an oral agreement under which, rather than paying Ribeiro 18 percent of the net profit from the wine sales, LaRocca would pay Ribeiro that percentage of the net profit from grapes LaRocca “sold” to himself. LaRocca explained that the reason for the modification was that Ribeiro “was not willing to wait” to take his payment from the wine sale profits. LaRocca was uncertain when this oral agreement was made, but he recalled where it was made (“right by [Ribeiro’s] duck club”), and shaking his hand to acknowledge the agreement.
In August 1997, LaRocca paid Ribeiro a percentage of the profit from the sale of chardonnay wine. Consistent with the claimed oral agreement, however, following this payment LaRocca paid Ribeiro based on accountings that did not reflect wine sales; instead, the accountings reflected only grape sales, including grapes LaRocca “sold” to himself. These payments were made for grapes harvested in the years 1997 through 2005, and Ribeiro accepted the payments (and the related accountings) without complaint.
For example, the 2005 accounting reflected the “sale” of 62.17 tons of zinfandel grapes to LaRocca at $1,000 per ton.
In July 2006, Ribeiro served LaRocca with a three-day notice to quit, claiming waste and failure to provide proof of workers’ compensation insurance. In November 2006, Ribeiro served LaRocca with an amended notice to quit which added the claim that no accountings of or payments from wine sales had been provided for 2000 to the present.
Shortly after service of the amended notice to quit, Ribeiro commenced this action by filing an unlawful detainer complaint against LaRocca.
In his answer to the complaint, LaRocca admitted he had leased the properties pursuant to the written leases but claimed “the agreement was later changed so that payment was based on the grapes delivered to LaRocca Vineyards and others rather than based on wine sales due to the length of time involved waiting for wine sales to occur.” LaRocca further alleged that recovery was barred because the parties had “executed the oral modification.”
The case was eventually tried over two days in November 2007. In his posttrial brief, LaRocca argued the written leases were modified by an oral agreement that was executed when LaRocca paid Ribeiro for the grapes from which he produced the wines.
On January 2, 2008, the court issued its tentative decision. With respect to the accounting and rent issue, the trial court’s decision provided as follows: “The parties to the lease orally modified the accounting and rent provisions set forth in paragraph 7 of each lease, and those oral executed modifications are binding on the parties. Defendants have provided appropriate accountings and paid all sums due to plaintiffs under their agreements. Plaintiffs accepted those accountings and payments without protest until the first amended notice was served.”
The court’s tentative ruling also included a finding that “the conduct of plaintiffs in this regard [i.e., in accepting the accountings and payments without protest] has created a situation where they are estopped from claiming defendants breached the leases as claimed by plaintiffs.” This finding was apparently triggered by LaRocca’s posttrial brief, where he argued for the first time that Ribeiro was estopped from claiming breach of the leases by the failure to pay him based on wine sales.
On January 10, 2008, Ribeiro filed a request for a statement of decision. Ribeiro’s request asserted that the statement of decision should include numerous details with respect to the accounting and rent issue.
Pursuant to the tentative ruling, LaRocca’s attorney prepared the proposed statement of decision. In doing so, he did not provide any additional information in response to any of the specific requests Ribeiro had made regarding the statement of decision; instead, the proposed statement of decision was identical to the tentative ruling (with the exception of added “descriptions of [the property] covered in each lease”).
Ribeiro filed an objection to the proposed statement of decision and requested that it be modified or supplemented to address numerous insufficiencies. The court declined to modify or supplement the statement of decision and instead filed it exactly as prepared by LaRocca’s attorney.
The court entered judgment in favor of LaRocca in February 2008, and Ribeiro filed a timely notice of appeal.
DISCUSSION
I The Statement Of Decision Was Adequate
Ribeiro first contends the trial court committed reversible error because it failed to determine numerous material issues in its statement of decision. We disagree.
Section 632 of the Code of Civil Procedure provides in relevant part that “upon the trial of a question of fact by the court” “[t]he court shall issue a statement of decision explaining the factual and legal basis for its decision as to each of the principal controverted issues at trial upon the request of any party appearing at the trial... made within 10 days after the court announces a tentative decision.... The request for a statement of decision shall specify those controverted issues as to which the party is requesting a statement of decision.”
“A trial court rendering a statement of decision under Code of Civil Procedure section 632 is required only to state ultimate rather than evidentiary facts. A trial court is not required to make findings with regard to detailed evidentiary facts or to make minute findings as to individual items of evidence.” (Nunes Turfgrass, Inc. v. Vaughan-Jacklin Seed Co. (1988) 200 Cal.App.3d 1518, 1525.) Moreover, “In issuing a statement of decision, the trial court need not address each question listed in a party’s request. All that is required is an explanation of the factual and legal basis for the court’s decision regarding such principal controverted issues at trial as are listed in the request.” (Ibid.) Ultimately, reversible error will be found only if the trial court failed to make findings of fact on material issues necessary to fairly disclose the basis for the trial court’s judgment. (Employers Casualty Co. v. Northwestern Nat. Ins. Group (1980) 109 Cal.App.3d 462, 473-474.)
Here, the trial court expressly found in the statement of decision that the parties orally modified the accounting and rent provisions in the leases, LaRocca provided appropriate accountings and paid all sums due under the oral modification, and Ribeiro accepted those accountings and payments without protest until the first amended notice to quit was served. While terse, these findings of ultimate fact fairly disclose the basis for the trial court’s judgment in favor of LaRocca, and the additional evidentiary detail Ribeiro complains the trial court left out was not required to make the statement of decision legally sufficient. Although inclusion of the terms of the oral modification in the statement of decision would have been helpful, the absence of those terms does not render the statement of decision defective because LaRocca did not present alternate scenarios on this point. By finding that the parties orally modified the leases, the trial court found that the oral modification the parties made was the one LaRocca alleged in his answer to the unlawful detainer complaint and testified about at trial. Accordingly, the trial court did not err when it refused to include any of the further details Ribeiro requested in the statement of decision.
Whether there was sufficient evidence to support LaRocca’s claim of an oral modification of the leases is a separate matter we address below.
II There Was Sufficient Evidence Of An Executed Oral Modification Of The Written Leases
Ribeiro contends there was no substantial evidence of an executed oral agreement to modify the provisions in the written leases requiring LaRocca to pay Ribeiro a percentage of the net profit from the sale of the organic wines produced from grapes grown on the property. We disagree.
An appellant “who challenges the sufficiency of the evidence to support a trial court finding” faces a “daunting burden.” (In re Marriage of Higinbotham (1988) 203 Cal.App.3d 322, 328-329.) “‘When a finding of fact is attacked on the ground that there is not any substantial evidence to sustain it, the power of an appellate court begins and ends with the determination as to whether there is any substantial evidence contradicted or uncontradicted which will support the finding of fact.’” (Foreman & Clark Corp. v. Fallon (1971) 3 Cal.3d 875, 881.) In determining whether the evidence was sufficient, “‘we must examine all factual matters in the light most favorable to the prevailing parties and resolve all conflicts in support of the judgment.’” (Kasparian v. County of Los Angeles (1995) 38 Cal.App.4th 242, 259.)
Before we address the sufficiency of the evidence here, we pause to identify the legal principles with respect to which the evidence was offered. Subdivision (b) of Civil Code section 1698 provides that “[a] contract in writing may be modified by an oral agreement to the extent that the oral agreement is executed by the parties.” “An executed contract is one, the object of which is fully performed. All others are executory.” (Civ. Code, § 1661.) Where a written lease calls for the payment of rent for a particular period, an oral agreement calling for the payment of a different amount of rent is executed when payment of the different amount is “actually made and accepted as rent in full for the period covered by” the payment. (Stoltenberg v. Harveston (1934) 1 Cal.2d 264, 266; see also Julian v. Gold (1931) 214 Cal. 74.) The oral agreement is not executed, however, with respect to payments not yet made by the tenant and/or not yet accepted by the landlord. (Stoltenberg, 266-267.)
Under these principles, the question is whether there was substantial evidence: (1) that LaRocca and Ribeiro entered into an oral agreement providing for LaRocca to pay Ribeiro a percentage of the net profit from the grapes LaRocca “sold” to himself, rather than a percentage of the net profit from LaRocca’s wine sales; and (2) that LaRocca made payments under the oral agreement, and Ribeiro accepted those payments, from 2000 until Ribeiro served the amended notice to quit requiring payment under the terms in the written leases. We conclude the answer to that question is “yes.”
A Contract Formation
Ribeiro first argues there was no substantial evidence of an oral agreement to modify the written leases. Parsing LaRocca’s admittedly vague testimony about when he made the oral agreement with Ribeiro, Ribeiro insists that “LaRocca testified to an oral agreement concerning wine sales sealed with a handshake in the early ‘90s before the leases were executed,” and “[a]ny oral agreement made before the contracts were signed was super[s]eded by the writings” because of the integration clauses in the leases. (Italics added.) Ribeiro also contends that to the extent LaRocca “suggested a [further] discussion [regarding wine sales] might have occurred in the early to mid-‘90s between execution of the first and second leases,” that testimony was not substantial evidence of an oral agreement “since it is premised on speculation and conjecture.” While Ribeiro acknowledges that “LaRocca also testified wine sales were discussed in ‘around’ 1996,” Ribeiro claims LaRocca “said nothing about what was said” at that time and therefore “there is no basis for inferring an offer or an acceptance on that occasion.”
Both leases contained an integration clause stating that “[a]ll understandings and agreements made by and between the Parties, whether in writing or oral, with regard to the subject matter of this Agreement, are merged into this Agreement, which alone fully and completely expresses the Parties’ agreement, and neither party is relying upon any statements or representations not set forth herein.”
We are not persuaded. When the evidence is viewed in the light most favorable to LaRocca, as we must do, and not in the stilted and hypertechnical manner in which Ribeiro views the evidence, it was sufficient to support the trial court’s finding that the parties entered into an oral agreement to modify the written leases and allow LaRocca to pay Ribeiro for the grapes he “sold” to himself rather than to pay a percentage of the wine sales.
When first asked by Ribeiro’s counsel when “the plan” changed for Ribeiro to get a percentage of the profit from sale of the wine, LaRocca said, “it’s hard for me to be exact on the date, but I would say in the early ‘90s. It was actually discussed twice.” He then testified “the second time was around, I believe around ‘96. The first time was prior to when we wrote the contracts. We had changed it orally.” Later, however, LaRocca testified that “the first time [he] talked to [Ribeiro] about changing th[e] method of payment” was in the “mid-‘90s” “[t]o early 90s,” and the second time was at a meeting in January 2001. And on cross-examination, he further testified that he thought the first conversation about amending the lease “was after the lease was signed.”
While LaRocca could not pinpoint the date of the first discussion, his testimony was clear that he and Ribeiro orally agreed to “change” the basis of the payment LaRocca made to Ribeiro. Construed in the light most favorable to LaRocca, this testimony supports the conclusion that the conversation occurred after the leases were signed. Furthermore, the evidence of the payments LaRocca actually made to Ribeiro -- without objection from Ribeiro -- supports this conclusion. As we have noted, there was evidence of only one payment to Ribeiro from the wine sales -- a payment relating to chardonnay wine in August 1997. For the grapes harvested in the years 1997 through 2005, however, LaRocca did not account to Ribeiro or pay him for any wine sales; instead, he accounted and paid Ribeiro only for grapes he “sold” to himself, and Ribeiro never objected. This evidence strongly supports the inference that the discussion between LaRocca and Ribeiro about changing the basis for LaRocca’s payment to Ribeiro occurred after the payment from the wine sales in August 1997 but before LaRocca paid Ribeiro for the grapes harvested in 1997.
Ribeiro contends the evidence of “accountings and payments for grapes taken to the winery after August 1997” was not sufficient by itself to show the creation of an oral modification to the leases. Assuming that assertion is true, it is nonetheless immaterial, because the accountings and payments were not the only evidence of the oral agreement LaRocca claimed. As we have observed, LaRocca’s testimony, although far from exact, also supports the trial court’s finding that the parties agreed to modify the payment provisions in the leases. Taken together, LaRocca’s testimony about the oral agreement and the evidence of performance consistent with that agreement for a period of nearly 10 years are sufficient to overcome Ribeiro’s evidentiary challenge.
To the extent Ribeiro relies on “the letter from LaRocca’s attorney to Ribeiro’s attorney memorializing the 2001 meeting” as evidence that was inconsistent with LaRocca’s claim of an oral modification to the leases, that reliance is misplaced. LaRocca testified that at the 2001 meeting, “it was brought up that we would stay with the same payment of paying off of the grape sales that we were sending to LaRocca,” and neither Ribeiro nor his attorney insisted that they “go back to the literal language of the leases.” Nothing in the letter from Ribeiro’s attorney contradicts that testimony. While Ribeiro’s attorney stated in his letter that he would “propose a new form agreement to take the place of the existing contracts dated May 1, 1994 and May 1, 1995,” that statement did not necessarily reflect -- as Ribeiro contends -- “the parties’ intent that the agreement governing at that time was embodied in the leases as written.” In fact, the statement by Ribeiro’s attorney is just as consistent with the understanding that he was going to draft a new written (“form”) agreement that would incorporate the oral modification the parties had made to the existing written leases.
In summary, we conclude the evidence was sufficient to support the trial court’s finding that the parties orally agreed to modify the payment provisions in the written leases.
B Execution
Ribeiro argues that regardless of the evidence of contract formation, there was no substantial evidence that the purported oral agreement modifying the leases was executed. Again, we disagree.
Ribeiro first argues that because LaRocca was required to make payments under the 1994 lease based on anticipated net profit from wine sales, the payments LaRocca made to Ribeiro based on grapes he “sold” to himself might have been payments due under the 1994 lease, rather than payments made under an oral modification to that lease. Ribeiro contends this is significant because “written contracts cannot be set aside and implied contracts substituted therefor unless the conduct of the parties... is clearly inconsistent with and contrary to the terms of the writings.”
While Ribeiro’s statement of the law is largely true (see Garrison v. Edward Brown & Sons (1944) 25 Cal.2d 473, 479 [“Before a contract modifying a written contract can be implied, the conduct of the parties according to the findings of the trial court must be inconsistent with the written contract so as to warrant the conclusion that the parties intended to modify the written contract”]), it is irrelevant, because the modification to the written leases LaRocca claimed was oral, not implied. A contract is either express or implied. (Civ. Code, § 1619.) An express contract is one stated in words, while an implied contract is one manifested by conduct. (Civ. Code, §§ 1620-1621.) Because an oral contract is an express contract, not an implied contract, the requirement that the conduct of the parties must be inconsistent with the written contract does not apply where (as here) an oral contract is at issue.
Ribeiro next argues that the acceptance of an alternate payment as the performance due under a written lease is necessary to establish execution, and “[t]here is no evidence [he] accepted payment for grape sales as payment in full for wine sales” because “[n]one of the checks tendered included a notation to that effect, none of the accountings stated payment for grapes was made in lieu of payment for wine, and [he] testified he accepted the payments as a deposit against the amount owed for wine sales.” This argument disregards the standard of review, under which we must view the evidence in the light most favorable to LaRocca. LaRocca offered evidence that between 1997 and 2005, he paid Ribeiro for grapes he “sold” to himself, rather than for his sales of wine, and Ribeiro took the money and never objected. This evidence was sufficient for the trial court to find that the oral modification to the leases was executed, and the trial court was under no obligation to believe Ribeiro’s contrary testimony about his understanding of the basis for the payments he received.
Ribeiro argues that “an oral agreement cannot be executed with respect to future performance,” and therefore there could have been no execution “with respect to wine made from grapes harvested after written demands for accountings in 2004.” In essence, Ribeiro is asserting that he stopped accepting performance under the oral modification to the leases in 2004, and therefore the oral modification could not have been executed after then.
This argument fails because the 2004 “demand” to which Ribeiro refers is a letter from his attorney to LaRocca that in no way shows that Ribeiro was refusing to accept LaRocca’s payments for the “sale” of grapes to himself in lieu of the payments from the wine sales required under the written leases. In its entirety, the January 9, 2004, letter reads as follows: “As you know, this office represents Johnny A. Ribeiro, Jr. in regard to the above-referenced property. [¶] Neither I nor my client have received a response to my letter of May 29, 2003. You have not complied with the terms and conditions of the Lease Agreement and provided my client with financial records concerning the property. [¶] Accordingly, demand is made that you vacate the premises by January 15, 2004.”
Ribeiro points to no evidence to show that the “financial records” referenced in the January 9, 2004, letter had anything to do with wine sales, and he does not direct us to anywhere in the record where the content of the May 29, 2003, letter is revealed. Moreover, LaRocca offered contrary evidence that Ribeiro accepted the payment for grapes harvested in 2004 without objection. On this record, there was substantial evidence for the trial court to find that the oral modification to the leases was executed through 2004 notwithstanding the January 9, 2004, letter.
Finally, Ribeiro refers to letters from his attorney in June and September 2006 as evidence that the oral modification to the leases was not executed after then. In the June letter, Ribeiro’s attorney complained that LaRocca had committed “a clear breach of the Lease” by failing to provide an accounting of the net profit from the sale of the wines produced from grapes grown on the properties from the years 2000 through 2005. The September letter contained a similar complaint with respect to the years 2002 through 2005.
As to the years specifically mentioned in the letters, the trial court was not bound to find that the oral modification of the leases was not executed for those years simply because, long after the fact, Ribeiro may have decided to try to enforce the written leases. Indeed, under the law Ribeiro could not “undo” the earlier execution of the oral modification for the years 2000 through 2005 by complaining, months or years later, about the payments he received. Where a person accepts a tender of money or property without objection, any such objection is waived, and he is estopped from later complaining that the tender was insufficient. (See Jullian v. Gold, supra, 214 Cal. at pp. 79-80; Code Civ. Proc., § 2076.) Thus, the 2006 letters do not defeat the trial court’s finding that the oral modification to the leases was executed for the grapes grown on the properties in years 2000 through 2005.
As for the year 2006, even assuming the letters constituted a repudiation of the oral modification and an insistence on returning to the terms of the written leases going forward, this does not establish a breach on which LaRocca’s eviction from the properties could be premised in this unlawful detainer action. As we have explained, there was sufficient evidence for the trial court to find that the oral modification of the leases was executed with respect to the grapes grown on the property through 2005. Even assuming the June and September 2006 letters are treated as Ribeiro’s insistence on compliance with the written leases for all grapes grown and harvested thereafter, it is clear that any payments based on wine profits from those grapes would not have been due until 2007 or later -- after commencement of the unlawful detainer proceeding. To prove the right to possession of the properties in this action, however, Ribeiro had to prove one or more of the breaches alleged in his unlawful detainer complaint filed in November 2006. Obviously, those breaches could not have included the failure to account or pay for sales of wine that was to be made (in the future) from grapes that had not even been harvested yet.
In summary, we conclude the evidence was sufficient to support the trial court’s finding that the oral agreement modifying the leases was executed up through the time Ribeiro served the amended notice to quit.
DISPOSITION
The judgment is affirmed. LaRocca is entitled to recover costs on appeal. (Cal. Rules of Court, rule 8.278(a)(2).)
We concur: SCOTLAND, P. J., RAYE, J.
On appeal, Ribeiro argues the judgment cannot be upheld based on estoppel. We do not reach that argument, however, because -- as we will explain -- the trial court’s finding of an executed oral modification, which we conclude is supported by substantial evidence, provides a sufficient basis by itself to affirm the judgment. Similarly, we do not address the sufficiency of the statement of decision on the issue of estoppel because that issue was superfluous and immaterial.