Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment and orders of the Superior Court of Los Angeles County, Super. Ct. No. LC067590, Richard B. Wolfe, Judge.
Michael P. Ribons; Benedon & Serlin, Gerald M. Serlin, Douglas G. Benedon and Sandra J. Smith for Plaintiffs and Respondents.
Law Office of Jeanne Collachia and Jeanne Collachia for Defendants and Appellants.
ZELON, J.
This action arises from a pair of failed residential real estate transactions involving multiple agency by the realtor. Following a bench trial on an action for breach of fiduciary duty, breach of contract and breach of the implied covenant of good faith and fair dealing, the trial court ruled in favor of the client buyer/seller. It ordered specific performance and awarded damages for breach of fiduciary duty, lost rents and profits, and attorneys’ fees. We affirm.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
I. FACTS
A. The Parties and their Properties
Plaintiffs and respondents Benjamin and Inez Samuels own a condominium on Nita Avenue. Having lived there 30 years, they planned to sell their Nita Avenue unit, use the proceeds to buy a larger condominium, and transfer their Proposition 13 homeowners’ tax exemption to their replacement dwelling.
Proposition 13 imposed a limit on the power of state and local governments to adopt and levy ad valorem tax on real property. (See Cal. Const., art. XIII A, added by initiative measure in Primary Elec. (June 6, 1978).)
Persons over the age of 55 years may transfer the base year value of their residential property entitled to exemption to any replacement dwelling of equal or lesser value located within the same county and purchased or newly constructed by those persons as their principal residence within two years of the sale of the original property. (See Cal. Const., art XIIIA, § 2, subd. (a); Rev. & Tax Code, § 69.5, subd. (a)(1).)
Defendant and appellant Hildegard Merrill owns a condominium on Erwin Street, which she uses as rental property. A seasoned real estate and loan broker, Merrill has 37 years of experience in the real estate business. She works at the offices of defendant and appellant Calabasas Realty (Calabasas). Merrill has been the dual agent for both the buyer and the seller on numerous transactions.
B. The Merrill/Samuels Listing and Purchase Agreements
In 2003, the Samuels asked Merrill whether she knew of a larger unit available for sale. Merrill showed them her Erwin Street unit.
On November 7, the Samuels and Merrill executed a handwritten agreement, in which Merrill and Calabasas agreed to list the Samuels’ Nita Avenue unit for sale at $399,000 as soon as Merrill could procure a buyer. When that occurred, Merrill agreed she would open escrow for the Samuels to buy her Erwin Street unit in “‘AS IS’ condition subject to buyer’s inspection of property” at the agreed purchase price of $360,000. Escrow would open and close concurrently on both properties.
The terms of the handwritten agreement were subsequently incorporated in two California Association of Realtors California Residential Purchase Agreements and Joint Escrow Instructions (CAR agreements). First, the parties signed a November 9 CAR agreement authorizing Merrill and Calabasas to be the Samuels’ exclusive real estate broker on sale of the Nita Avenue unit priced at $399,000.
Second, the parties executed a November 12 CAR agreement authorizing Merrill and Calabasas to be the Samuel’s exclusive real estate broker on purchase of the Erwin Street unit priced at $360,000. Merrill disclosed that she, as the seller, is a “licensed California Real Estate broker.” Although a handwritten notation indicated the Erwin Street property was to be sold “As Is, ” the agreement also provided that “[b]uyer’s acceptance of the condition of any and all matters affecting the Property is a contingency of this Agreement . . . .” The buyer must remove any applicable contingency in writing.
The Erwin Street unit purchase agreement further represented that “[b]uyer has given a deposit in the amount of . . . $10,800 to the agent submitting the offer . . . by personal check . . . made payable to Calabasas Realty which shall be held uncashed until Acceptance and then deposited within 3 business days after Acceptance . . . with Escrow Holder . . . .” However, the deposit was not made. The Samuels contend that Merrill had declined to accept their deposit check on several occasions with the explanations that it was not necessary at the time, that it was a cash transaction, and that they should wait until inspection issues were resolved. Escrow Officer Charlotte Stephens also advised the Samuels not to deposit the funds until the parties could agree on the repairs. Merrill denied she had waived the good faith deposit.
C. The Samuels/Kohan Purchase and Loan Agreements
On November 10, following an open house at the Nita Avenue unit, Susan Kohan contacted Merrill to make an offer. Merrill promised to give Kohan a $3,000 rebate at the close of escrow on the Nita Avenue unit. Merrill became Kohan’s real estate and mortgage broker on the transaction.
Kohan presented a written offer on a CAR agreement to purchase the Samuels’ Nita Avenue unit for $399,000. The Samuels accepted the offer with the condition that the purchase of their Nita Avenue unit would be subject to their purchase of the Erwin Street unit, both to close escrow concurrently. The estimated close of escrow date for both transactions was January 9, 2004.
On November 19, Merrill opened escrow on Nita Avenue and delivered Kohan’s $12,000 deposit check to escrow officer Stephens. On December 5, Merrill locked in Kohan’s loan on the Nita Street unit, providing for a $5,624 rebate to Merrill as the mortgage broker.
D. The Inspection Contingency on the Erwin Street Transaction
Both orally and in a November 12 real estate disclosure statement, Merrill disclosed to the Samuels that her Erwin Street unit had sustained water damage when the homeowners’ association installed new copper piping. The damage included warped cabinets and missing tiles in the master bath as well as badly stained carpets and interior walls. Merrill had retained a remediation company to remove the water and to ensure the premises were dry. Another company Merrill had hired to check for mold reported no finding of toxic mold. Merrill had filed a claim with the plumber’s insurance company and received payment of $30,000 for her damages.
On November 26, the Samuels, their physical inspector and a mold consultant inspected the Erwin Street unit. Among other things, the inspection found evidence of mold, dry rot and asbestos. On December 19, while awaiting formal inspection reports, the Samuels sent a letter to “update” Merrill on the condition of the Erwin Street property.
The December 23 inspection reports determined that mold was present in the attic wall, behind the baseboard of the laundry room, and in the sub-floor of the hot water heater closet. An extensive mold remediation project was proposed for the attic, laundry room, hot water heater closet, kitchen, dining room, as well as the heating, ventilating and air-conditioning (HVAC) system. The quoted estimate for the mold remediation was $7,700.
On December 26, Benjamin Samuels wrote a letter to Merrill memorializing their discussions about the mold remediation. The letter expressed concern that Merrill had been unsuccessfully seeking insurance payment and had expressed her unwillingness to pay more than $1,000 to her general contractor, rather than a mold contractor, for the work. In order to timely close escrow, Samuels suggested that $15,000 be held back in escrow to pay for the mold remediation and other repairs. He proposed a clean up schedule to accomplish the remediation and re-inspection in time for escrow to close.
E. Failure to Open Escrow on the Erwin Street Transaction
At a December 29 meeting with escrow officer Stephens about a proposed escrow amendment on the mold remediation on the Erwin Street unit, the Samuels were surprised to learn that Merrill had never opened escrow on the Erwin Street transaction. Stephens neither knew she was handling escrow for the Erwin Street unit nor had a copy of that purchase agreement. When contacted, Merrill told Stephens she had forgotten to open escrow. Merrill faxed Stephens part of the purchase agreement the next day and the entire agreement on January 5, 2004. Escrow on the Erwin Street unit officially opened December 30 for a closing date on or before January 12, 2004.
F. Meeting and Agreement of the Parties
On January 7, 2004, one week before escrow was to close on both properties, Kohan called the parties together to discuss the outstanding issue of who would pay for the mold remediation. At the contentious meeting, they agreed that escrow would close concurrently on the Erwin Street and Nita Avenue units on or before January 12. Merrill executed a signed and dated handwritten note to the effect and that she would hold back $20,000 in escrow for mold remediation to conform with United States Environmental Protection Agency (EPA) guidelines.
G. Delays in Escrow
No amendment was entered into the escrow instructions for the Erwin Street transaction. Delays in opening escrow and other issues made it impossible to close escrow by January 12. The preliminary title check revealed several issues to be resolved, including two unsecured tax liens, an abstract of judgment and a deed of trust. These questions were not resolved until January 20.
H. Mold Remediation
On January 13, Merrill hired her son and three other workers to commence the demolition, which interfered with the remediation work by mold contractor Aeroscopic. By this time, the Samuels were packed, ready to move and had their movers on hold. When they learned Merrill’s remediation work did not meet EPA guidelines, they told escrow they would take the Erwin Street property “as is” and pay for mold remediation themselves without requiring any money to be held back in escrow.
I. Proposed Escrow Amendment to the Erwin Street Transaction
On January 14, Stephens faxed a letter to Merrill advising her that the Samuels would take her Erwin Street unit “‘AS IS’” and asking if she was ready to proceed with the concurrent closing of the two properties. Stephens also forward Merrill an amendment to the escrow instruction providing that the Samuels would take full responsibility for removal of the mold, pay for the work, and select the company to complete the job at the Erwin Street unit. They would pay up to $500 for the work begun by Aeroscopic, but not the work done by Merrill’s son. The amended instructions underscored the need to “close this transaction immediately in accordance with the original escrow instructions calling for a concurrent closing of escrow with buyer’s sale escrow.”
On January 15, Merrill signed and wrote “not agreeable” on the proposed escrow amendment and attached a note demanding that the Samuels pay for the work that had been done to date and for the rest of the mold remediation Merrill had scheduled.
J. Kohan’s New Loan for the Nita Street Transaction
On January 16, dissatisfied with the untimely closing of escrow, Kohan cancelled the loan secured by Merrill and arranged for a more favorable loan with another lender.
K. Merrill’s Cancellation of the Erwin Street Transaction
On January 20, Merrill faxed a note to Stephens canceling the transaction with the Samuels on the Erwin Street unit. At trial, Merrill testified that she cancelled the escrow because there had been no agreement on the contract, the Samuels had never made a good faith deposit, Kohan had cancelled her loan, and the delay had caused Merrill to lose her opportunity to effect a tax-free exchange under section 1031 of the Internal Revenue Code (26 U.S.C. § 1031).
On January 20 and 25, counsel for the Samuels sent letters to Merrill demanding specific performance and mediation.
On January 26, Stephens advised the Samuels in writing that Merrill was “very aware” but did “not seem concerned” that the Samuels had not deposited funds for the Erwin Street transaction. Given the disagreement over mold remediation, Stephens had agreed with Merrill that it would be best for the Samuels to withhold the deposit until the matter could be resolved. As to Merrill’s use of the non-deposit as an excuse for non-performance, Stephens stated in her letter that the Samuels “had always performed, ” including agreeing to pay for the mold remediation and releasing Merrill from any obligation.
II. PROCEDURE
The Samuels filed an action against Merrill for specific performance, breach of fiduciary duty, and breach of the implied covenant of good faith and fair dealing as to both the Erwin Street unit and Nita Avenue unit transactions.
Following a bench trial, the superior court issued a 63-page statement of decision on the merits. It found that Merrill and the Samuels had a valid contract for the sale of the Erwin Street unit, that Merrill had breached the contract, and that the Samuels were entitled to specific performance. The court further determined that Merrill had breached her fiduciary duty to the Samuels and awarded $1,000 in damages for what it would cost to repack their belongings and move. It also held Merrill had breached the implied covenant of good faith and fair dealing, but determined the normal remedy for damages was subsumed by the decree for specific performance. The court declined to award punitive damages. In addition, the court held the Samuels were entitled to recover lost rents and profits according to proof from the time escrow should have closed and to recover their attorneys’ fees subject to proof.
Following post-trial hearings, the court issued a 12-page statement of decision awarding the Samuels $16,742.40 in lost rents and profits, as well as a 30-page statement of decision awarding them $146,465.03 in attorneys’ fees.
Merrill and Calabasas timely filed their notices of appeal from the judgment, the post-judgment order awarding attorneys’ fees, and the post-judgment order regarding lost profits and calculation of the amount of bond.
DISCUSSION
On appeal, Merrill contends the court erred on its ruling with respect to breach of contract, award for lost rent and profits, and award of attorneys’ fees.
Merrill has expressly waived her challenge to the court’s ruling on breach of fiduciary duty.
I. STANDARD OF REVIEW
Where there is a statement of decision, the appellate court is bound by the trial court’s findings if they are supported by the evidence. (Crisci v. Sorci (1952) 115 Cal.App.2d 76, 77; In re Marriage of Hoffmeister (1987) 191 Cal.App.3d 351, 358; In re Marriage of Ditto (1988) 206 Cal.App.3d 643, 647.) “‘“Where findings of fact are challenged on a civil appeal, we are bound by the ‘elementary, but often overlooked principle of law, that . . . the power of an appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted, ’ to support the findings below. [Citation.] We must therefore view the evidence in the light most favorable to the prevailing party, giving it the benefit of every reasonable inference and resolving all conflicts in its favor in accordance with the standard of review so long adhered to by this court.” [Citation.]’ [Citations.]” (Lenk v. Total-Western, Inc. (2001) 89 Cal.App.4th 959, 968.)
II. THE FINDING OF BREACH OF CONTRACT IS SUPPORTED BY THE EVIDENCE
A. Merrill is Bound by the Duties of a Broker
Merrill contends she was a principal, and not a broker, in the sale of her own Erwin Street unit. Therefore, she asserts that she did not have to abide by the obligations of a broker in that transaction.
Business and Professions Code section 10131 defines a real estate broker as “a person who, for a compensation or in expectation of a compensation . . . does or negotiates to do one or more of the following acts for another or others: [¶] (a) Sells or offers to sell, buys or offers to buy, solicits prospective sellers or purchasers of, solicits or obtains listings of, or negotiates the purchase, sale or exchange of real property or a business opportunity . . . .” Section 10133 provides certain exceptions to the licensing requirement, but none are applicable in this case.
All further statutory references are to the Business and Professions Code.
Prior to an amendment in 1985 (Stats. 1985, ch. 476, § 1), former section 10133, subdivision (a), provided that the definition of a real estate broker did not include “[a]nyone who directly performs any of the acts within the scope of this chapter with reference to his own property . . . .” This exception was removed without comment by the 1985 amendment. (Stats. 1985, ch. 476, § 1, appen.; 2 Miller & Starr, Cal. Real Estate (3d ed. 2000) Agency, § 3:17, p. 88, fn. 17.) Two of the cases that Merrill relied upon to demonstrate that a person acting as a principal is not a broker—Robinson v. Murphy (1979) 96 Cal.App.3d 763, 768 and Garcia v. Wetzel (1984) 159 Cal.App.3d 1093, 1097—were decided before 1985 and refer to former section 10133, subdivision (a).
A broker’s fiduciary duty remains the same even if the broker may also be a principal in the real estate transaction. (Greenwald & Asimow, Cal. Practice Guide: Real Property Transactions (The Rutter Group 2006) ¶ 2:157.11, p. 2-36.) Realtors, “when acting as principals in a real estate transaction, remain obligated by the duties imposed by the Code of Ethics.” (Code of Ethics and Standards of Practice of the National Association of Realtors, Jan. 1, 2004, Standard Practice 1-1.) Thus, once an agency has been created, the agent is not absolved of fiduciary duties merely because he or she is also buying or selling as a principal. (Roberts v. Lomanto (2003) 112 Cal.App.4th 1553, 1563.)
Section 10131 requires that the act be done for another, a requirement met here. Merrill was acting “for another” as the listing agent to sell the Samuels’ Nita Avenue unit, so that they could use the proceeds to purchase her Erwin Street unit. Merrill is a licensed broker and held herself out as such to the Samuels.
Moreover, dual agency or dual representation arises where the same broker represents both buyer and seller. Under such a scenario, the broker is a fiduciary for both buyer and seller. (Fragale v. Faulkner (2003) 110 Cal.App.4th 229, 235, 239, & fn.9.) Here, Merrill engaged in multiple representations that show she did not engage in an arm’s length transaction. First, Merrill, a real estate broker, acted as the principal in selling her Erwin Street unit. Second, Merrill represented the Samuels as buyers of her Erwin Street unit. Third, Merrill represented the Samuels as sellers of their Nita Avenue unit. Fourth, Merrill represented Kohan as the buyer of the Samuels’ Nita Avenue unit and arranged for her mortgage loan. Because of the contingent relationships between the transactions and their planned concurrent close of escrow, they comprised a single transaction. Indeed, Merrill’s cancellation of the Erwin Street transaction had a domino effect on the Samuels’ inability to sell their Nita Avenue unit to Kohan and her inability to buy their unit. As a result, Merrill’s duty as a broker extended to the entire transaction.
B. Negotiations Regarding Mold Remediation did not Constitute Cancellation of the Agreement
Merrill contends there was no enforceable contract, because the Samuels’ failure to remove the mold remediation contingency cancelled the sales agreement on the Erwin Street transaction.
“A condition precedent is one which is to be performed before some right dependent thereon accrues, or some act dependent thereon is performed.” (Civ. Code, § 1436.) “Although the Restatement avoids the terms ‘condition precedent’ . . ., preferring the word ‘condition’ alone to define the former concept (see Rest.2d Contracts, § 224, com. a), the definition it provides is essentially the same for purposes of the issue in this case: “A condition is an event, not certain to occur, which must occur, unless its non-occurrence is excused, before performance under a contract becomes due.” (Rest.2d, Contracts, § 224.) California authority is consistent. (See Beverly Way Associates v. Barham (1990) 226 Cal.App.3d 49, 54-55; Mattei v. Hopper (1958) 51 Cal.2d 119, 122; Kadner v. Shields (1971) 20 Cal.App.3d 251, 257.)
The purchase agreement for the Erwin Street unit set a 17-day time limit for removing contingencies based on buyers’ investigations, approval of disclosures, reports and other applicable information. Within that time period, the agreement permitted the buyer to request that the seller make repairs or take any other action regarding the property. In addition, the buyer was required to either remove the applicable contingency in writing or cancel the agreement. If the buyer failed to do so, the seller, after first giving the buyer a notice to perform, could cancel the agreement in writing.
The record shows that while the Samuels did not make their remediation requests within 17 days after acceptance, escrow was not opened until December 30. Before the opening of escrow, the Samuels conducted their general and mold inspections, submitted their reports and wrote a letter to Merrill seeking an acceptable arrangement to carry out the mold remediation. They initially suggested in writing that Merrill hold back $15,000 from escrow and proposed a clean-up schedule for the work. Merrill later agreed in writing to hold back $20,000 in escrow for the mold remediation. Indeed, Merrill took it upon herself to hire her son and other contractors to carry out the demolition work. At no time did the Samuels remove in writing the contingency of mold remediation or cancel the agreement in writing. Under the totality of the circumstances, we agree with the trial court that the conduct of the parties showed there was no cancellation of the purchase agreement. Rather, the evidence supports the court’s conclusion that the Samuels and Merrill were continuing to negotiate the issue of mold remediation as a means to perfect the buyers’ acceptance.
C. The “As Is” Language in the Agreement did not Preclude Remediation Upon Inspection
Merrill contends that the Samuels rejected the contract, because they did not accept the “as is” language in the Erwin Street sales agreement. She asserts that the Samuels could not have purchased the unit in its January 2004 “as is” condition, because it was no longer in the same condition as when the purchase agreement was signed in November 2003.
The parties original handwritten agreement provided that the “‘AS IS’ condition” was subject to buyer’s inspection of property.” Consistent with the intention of the parties, despite the “as is” language, the sales contract provided for the buyer’s investigation of the property and matters affecting the property.
At trial, Alan Herd, Merrill’s expert, testified that “‘[a]s is’ means its existing condition. It does not necessarily mean those things which you can’t see, latent defects, but any patent defects, you’d take the property with those included. [¶] And then, subject to buyer’s inspection, contemplates the protocol of due diligence where the buyer has the right to inspect the property and either approve or disapprove of what they find with cause. [¶] And if they approve, that takes care of the clause. [¶] If they disapprove, they then have the right to either withdraw or renegotiate.”
Here, consistent with the expert’s definition of the “as is” condition, the Samuels negotiated mold remediation, a latent defect behind walls and underneath floor boards. Indeed, the Samuels were ultimately willing to accept the Erwin Street unit “as is” with no money held back in escrow and undertake responsibility for the mold remediation themselves. Accordingly, substantial evidence supports the court’s conclusion that there was a meeting of the minds on the “as is” provision of the sales contract.
D. The Agreement was not Unenforceable without a Deposit
Merrill contends that the Erwin Street sales contract was unenforceable because the Samuels failed to tender their $10,800 deposit.
Viewing the entire record in the light most favorable to the judgment below, we determine there is substantial evidence such that a reasonable trier of fact could find that Merrill waived that deposit. Merrill had declined to accept the Samuels’ deposit check on several occasions, asserting alternatively that it was not necessary at the time, it was a cash transaction, and inspection issues should be resolved first. Escrow Officer Charlotte Stephens also advised the Samuels not to deposit the funds until the parties could agree on the repairs.
Even assuming the deposit was required for a valid sales agreement, the agreement provides that the seller must first provide the buyer with a written and signed notice to perform within 24 hours. Merrill failed to give such notice to the Samuels. Thus, the agreement is not unenforceable.
E. Cancellation of Kohan’s Loan did not Make the Erwin Street Transaction Fail due to Impossibility or Frustration of Purpose
Merrill asserts that Kohan’s cancellation of her loan made the transactions impossible or frustrated their purpose, because the Samuels were now unable to purchase Merrill’s property.
The record shows that at the time Kohan cancelled the loan she secured through Merrill, Kohan already had another loan in hand. Kohan had reassured Merrill that she was ready to close at that time. Nothing in the record support’s Merrill’s belief that there would be a month-long delay in closing escrow on the Nita Avenue transaction.
Nor did Merrill at any time include in any of the sales or purchase agreements that she had planned to trade her Erwin Street unit for like property under an Internal Revenue Code section 1031 exchange. Even if she had, her replacement property need not have been “identified” until 45 days after the sale of the old property, and the acquisition of the replacement property need not have been completed until 180 days after that sale. (26 U.S.C. § 1031(3)(A) & (B)(1).)
Therefore, Merrill can point to no evidence that the cancellation of Kohan’s loan in any way caused the Erwin Street transaction to fail.
III. The Trial Court did not Abuse its Discretion in Awarding Lost Rent and Profits
Merrill contends that the court erred in awarding the Samuels $16,742.40 in lost rent and profits, because it failed to give any offset to her for the money she spent to refurbish the Erwin Street unit. She claimed that contrary to the purpose of specific performance, the Samuels ended up in a better position than they would have been had the contract been performed.
Equity permits a court to make a monetary award incident to specific performance. “In California the compensation which may be awarded incident to a decree of specific performance is not for breach of contract and is not legal damages. The complainant affirms the contract and asks that it be performed. Since the time for performance has passed, the court relates that performance back to that date, by treating the parties as if the change in ownership had taken place at that time.” (Hutton v. Gliksberg (1982) 128 Cal.App.3d 240, 248.) The process is “more like an accounting between the parties than like an assessment of damages.” (Stratton v. Tejani (1982) 139 Cal.App.3d 204, 212; internal quotation marks omitted.) The compensation which traditionally has been awarded involves “adjustments relating to the loss of use of the property or purchase money during the period required to pursue the specific performance remedy.” (Hutton v. Gliksberg, supra, 128 Cal.App.3d at p. 248.)
The buyer is usually awarded the rents and profits from the time the contract called for performance to judgment and the seller is entitled to an offset for the loss of use of, i.e. interest on, the purchase money that the seller would have received if the contract had been timely performed. (Stratton v. Tejani, supra, 139 Cal.App.3d at p. 212.)
Here, the Samuels as the buyers, and not Merrill as the seller, were awarded interest. The trial court calculated the lost rent and profits by multiplying the amount Merrill had charged for rent on the Erwin Street property ($2,580 per month) by the time that had elapsed between the date escrow should have closed and the date of the hearing regarding the amount of lost rent and profits (28 months). That amount was offset by subtracting the presumed amount of homeowners’ association fees for the condo ($1,700 per month) times 28 months. We find no error in the court’s reliance on the formula in Hutton v. Gliksberg. The court adjusted for the interest Merrill would have received up to the date of the hearing on her net proceeds from the sale, along with the interest the Samuels would have earned on the difference between the rents and homeowners association fees.
The court rejected Merrill’s request to offset the claimed improvements and repairs to the property made after the date escrow was to close, because they were not part of the bargain the Samuels had made with Merrill. Moreover, Merrill had not submitted the necessary evidentiary support for her claimed $68,000 of claimed improvements.
The guiding principle in this area remains one of equity. “In a world of change, equitable remedies have been expanded to meet increasing complexities. Equity is not bound by rigid precedent but has the flexibility to adjust the remedy in order to do right and justice. [Citations.]” (Hutton v. Gliksberg, supra, 128 Cal.App.3d at p. 249.) The trial court determined that Merrill had failed to establish any rise in rents and profits or any other offsets. Accordingly, the court acted within its discretion in setting the amount of lost rent and profits.
IV. SUBSTANTIAL EVIDENCE SUPPORTED The Trial Court’S FINDING THAT A condition precedent for an attorneys’ fee award WAS satisfied
The CAR agreement on the Erwin Street transaction provides that the buyer and seller “agree to mediate any dispute or claim arising between them out of this Agreement, or any resulting transaction, before resorting to arbitration or court action. . . . If, for any dispute or claim to which this paragraph applies, any party commences an action without first attempting to resolve the matter through medication, or refuses to mediate after a request has been made, then that party shall not be entitled to recover attorney fees.” The agreement further provides that “[i]n any action, preceding or arbitration between Buyer and Seller arising out of this Agreement, the prevailing Buyer or Seller shall be entitled to reasonable attorney fees and costs from the non-prevailing Buyer or Seller . . . .”
Merrill does not contest the amount of the attorneys’ fee award. Instead, she asserts the Samuels are not entitled to attorneys’ fees, because they failed to satisfy the requirement in the sales contract that mediation be attempted. Even though the Samuels letter requesting mediation listed Merrill’s office fax number on the face of the letter, she contends that the fax confirmation showed the letter was faxed instead to Benjamin Samuel’s fax number. However, in Merrill’s opposition to the Samuel’s motion for attorneys’ fees, she filed no declaration to stating that she never received the request for mediation. In the Samuels’ reply, attorney Michael Ribons declared that he faxed the correspondence to Merrill’s office at Calabasas Realty on January 25, 2004. He later called and confirmed with a man, called Bill and identified himself as an employee of Merrill’s, that the facsimile was received. When Ribons asked if Bill had called Merrill to advise her of the fax, Bill responded that it was her policy to pick up faxes whenever she came to the office, which was at her convenience. Ribons further declared that Merrill confirmed her fax number at her deposition. He also stated that at trial, Stephens confirmed that the letter requesting mediation was in Merrill’s escrow file on or about January 25. Finally, Ribons declared that at trial Merrill confirmed that there was a man who might have worked in her office in late January to early February 2004.
A trial court’s finding that a legal condition precedent for an award of attorneys’ fees has been satisfied will be upheld if supported by substantial evidence. (Frei v. Davey (2004) 124 Cal.App.4th 1506, 1511.) “[W]e may affirm a trial court judgment on any basis presented by the record whether or not relied upon by the trial court. [Citation.]” (Day v. Alta Bates Medical Center (2002) 98 Cal.App.4th 243, 252, fn. 1.) The trial court determined that the Samuels had made a “meaningful attempt” to mediate the dispute that satisfied the contractual requirements as a condition precedent to the recovery of attorneys’ fees. Given the totality of the circumstances, we find that the Samuels made a good faith attempt to mediate the dispute.
Accordingly, substantial evidence supports the court’s finding that the legal condition precedent for an attorneys’ fee award has been satisfied.
DISPOSITION
The judgment is affirmed. Respondents are to collect their costs on appeal.
We concur:
JOHNSON, Acting P.J., WOODS, J.