Opinion
E065022
11-09-2017
EMILE SWEIDA, Plaintiff and Respondent, v. LAURA DEAN, Defendant and Appellant.
Laura Dean Buck, in pro per, and for Defendant and Appellant. Reynolds, Jensen & Swan and Barry R. Swan for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super.Ct.No. RIC1406965) OPINION APPEAL from the Superior Court of Riverside County. Gloria Trask, Judge. Affirmed. Laura Dean Buck, in pro per, and for Defendant and Appellant. Reynolds, Jensen & Swan and Barry R. Swan for Plaintiff and Respondent.
Defendant Laurie Dean appeals from a judgment in favor of her former landlord, plaintiff Emile Sweida, who sued her for failure to pay rent. In her defense, she claimed she was excused from the obligation or, in the alternative, was immune from liability as a director of a nonprofit corporation who had signed the lease on the entity's behalf. After a bench trial, the trial court found Dean had breached the lease by failing to make several rent payments, entered judgment in favor of Sweida, and awarded him damages and attorney fees. Dean, who represents herself on appeal as she did before the trial court, challenges the sufficiency of the evidence supporting the judgment. Finding ample evidentiary support in the record, we affirm.
I
FACTUAL BACKGROUND
From November 2011 until she vacated in June 2014, Dean operated an animal charity thrift store called Golda's House Animal Rescue Thrift And Boutique out of a commercial unit she leased from Sweida. Dean signed the lease in her name, with the title of "President" of Golda's House Animal Rescue Thrift And Boutique. In trial court proceedings and on appeal, however, she claims she entered the lease on behalf of a nonprofit corporation called Golda's House Animal Rescue.
A. The Complaint and Matters Deemed Admitted
Sweida's complaint alleged Dean had leased a commercial unit from him for several years and stopped paying rent one month into their most recent yearlong lease extension. He sought damages from Dean for the 11 months she had not paid rent (minus the rent he received from his new tenant during Dean's lease term), plus late fees, prejudgment interest, and costs to obtain a new tenant under Civil Code section 1951.2.
In relevant part, this provision allows a lessor, upon termination of a lease for breach, to recover from the breaching lessee: "(1) The worth at the time of award of the unpaid rent which had been earned at the time of termination; (2) The worth at the time of award of the amount by which the unpaid rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that the lessee proves could have been reasonably avoided; [¶] . . . [¶] (4) Any other amount necessary to compensate the lessor for all the detriment proximately caused by the lessee's failure to perform his obligations under the lease or which in the ordinary course of things would be likely to result therefrom." (Civ. Code, § 1951.2.)
Dean asserted two defenses in her answer. She claimed she was immune from liability because she was a director of Golda's House Animal Rescue and had entered the lease on the nonprofit corporation's behalf. She also claimed Sweida had told her in early 2014 he would dissolve the lease with "no penalty or 'hard feelings'" because he had caused her store to lose revenue by failing to take steps to evict a troublesome neighboring tenant and failing to file a class action lawsuit to oppose a freeway expansion that would "cause[] gross losses to all local businesses."
In response to Dean's answer, Sweida filed an amended complaint naming Golda's House Animal Rescue as a defendant. That entity did not respond to the complaint, and the clerk of the court entered default against it.
Dean filed a motion to dismiss the complaint on the ground she was immune from liability under Corporations Code section 5047.5, which shields volunteer directors and officers of nonprofit corporations from claims for monetary damages in certain limited circumstances. The court denied the motion.
During discovery, Sweida propounded a request for admissions on Dean, and when she did not respond, filed a motion to deem the matters in the request admitted under Code of Civil Procedure section 2033.280. Under that statute, when a party fails to timely respond to a request for admissions, it waives any objections to the requests and "[t]he requesting party may move for an order that the genuineness of any documents and the truth of any matters specified in the requests be deemed admitted, as well as for a monetary sanction." (Code Civ. Proc., § 2033.280, subds. (a)-(b).) Unless the court determines the responding party has substantially complied with the statute, it must order the request for admissions deemed admitted. (Id. at subd. (c).) "'[A] deemed admitted order establishes, by judicial fiat, that a nonresponding party has responded to the requests by admitting the truth of all matters contained therein.'" (St. Mary v. Superior Court (2014) 223 Cal.App.4th 762, 776.)
After a hearing, the trial court granted Sweida's motion, deeming the following matters admitted: (1) Dean entered into the lease with Sweida; (2) Dean breached the lease by failing to pay rent; (3) Sweida reasonably mitigated his damages; (4) for each year after the expiration of the initial term of the lease, Dean entered into an addendum extending the lease term; (5) Sweida did not breach the lease; and (6) Sweida was not at fault for Dean's failure to pay rent.
B. Trial
Sweida's testimony was consistent with the allegations in his complaint. He said he and Dean initially entered into a one-year lease in November 2011 and renewed the lease three more times after that first year, each time for another one-year term. The lease term at issue began in December 2013 and ended on November 30, 2014, and rent was $2,700 a month. Sweida said after December 2013, he never received another rent check from Dean. In May 2014, after his informal requests for rent were unsuccessful, he gave Dean a notice to pay rent or quit. When Dean still did not pay, Sweida asked her to move out so he could lease the unit to another tenant. He said Dean did not vacate the unit until late June 2014.
As to his damages and mitigation efforts, Sweida said he had been in talks with at least three other potential tenants before finding a company willing to pay a reasonable monthly rent. In exchange for a credit of two months' rent, the company agreed to begin leasing the unit in September 2014 for $3,000 a month. The company paid $3,000 for September's rent and Sweida applied the credit to October and November 2014. Sweida testified his total pre-interest damages were $25,157.50, which consist of rent for January through November (minus the $3,000 from the new tenant), late fees, and costs incurred in obtaining the new tenant.
Dean told a different story. She said Sweida had come to her in early 2014 and asked her to "let him off the hook." According to Dean, Sweida said he wanted to rent the unit to a different tenant and told her there would be "no punitive action" if she vacated and allowed him to dissolve the lease. Dean had no record of this conversation however, because it was verbal only.
Dean said vacating the unit was overwhelming and took a long time because of the large amount of items she had accumulated at the store. She also said she had given Sweida a cashier's check for the January 2014 rent, but could not find the receipt.
On rebuttal, Sweida reiterated Dean had never given him a check for January. He submitted into evidence the ledger in which he kept track of rent payments from his numerous commercial tenants. The ledger reflected he had not received any rent from Dean in 2014.
Aside from the rent payment dispute, the other focus of trial was Dean's claim of immunity based on her status as director of Golda's House Animal Rescue. Dean argued she could not be personally liable for any missed rent payments because she had signed the lease as an agent of a nonprofit corporation. Sweida submitted the initial lease into evidence. It states: "This lease is made between Emile Sweida, herein called Lessor, and Laurie Deane, DBA Golda's House Animal Rescue Thrift And Boutique, herein called Lessee." The parties agreed that at Dean's request during the signing of the lease Sweida had crossed out "DBA" and next to it wrote the word "President," but they disagreed over the meaning of that revision. Dean said the word "President" indicated she had signed the lease as an agent of the nonprofit corporation Golda's House Animal Rescue. Sweida said he believed Dean signed the lease on her own behalf, not as a corporate agent. He submitted into evidence the documents Dean had given him during the lease application process, which consisted of her driver's license, social security card, personal bank account statements, plus a form commercial lease application where Dean had marked the box indicating the occupant was a corporation (as opposed to a sole proprietorship or partnership). He also submitted the three lease extensions, the first two of which Dean had signed as "Laurie Dean" and the third she had signed as "Laurie Dean Pres Golda's House." Sweida said he was aware Dean intended to operate her animal charity thrift store—Golda's House Animal Rescue Thrift And Boutique—out of the unit, but he has never known the specific status of that business, such as whether it was a corporation, sole proprietorship, or dba.
At trial, Dean said she also goes by the name of Deane. --------
Dean called Patricia Walkley as a witness. Walkley said she was a director of "Golda's House Animal Rescue" and the manager of "Golda's House Thrift Vintage Boutique." She said she was present at the meeting when the parties signed the initial lease and heard Dean tell Sweida "we were a [nonprofit corporation] and we were not a dba." To impeach this testimony on cross-examination, Sweida's counsel submitted Walkley's deposition testimony that she did not recall any conversation about the terms of the lease at that meeting. In response, Walkley said she had been nervous at the deposition and as a result had suffered a panic attack that interfered with her comprehension. Walkley acknowledged that in addition to being coworkers, she and Dean lived and owned property together.
The trial court found for Sweida on all issues. It found Dean, not any of her claimed businesses, was the lessee and it disbelieved her testimony that she had paid January's rent and had been excused from the remainder of her rent obligation. The court awarded Sweida $27,820.76 in damages and $20,715 in attorney fees under the lease's attorney fees provision.
II
DISCUSSION
We understand Dean's appeal as a challenge to the sufficiency of the evidence supporting the judgment. She argues the trial court "based [its] decision through an overly simplified and negligent view of this case before [it] . . . and accepted statements as true which were contrary to the overwhelming weight of the evidence."
"Where findings of fact are challenged on a civil appeal, we are bound by the 'elementary . . . 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." (Jessup Farms v. Baldwin (1983) 33 Cal.3d 639, 660.) We do not reweigh the evidence or assess the credibility of witnesses on appeal: "'All of the evidence most favorable to the respondent must be accepted as true, and that unfavorable discarded as not having sufficient verity to be accepted by the trier of fact.'" (Hittle v. Santa Barbara County Employees Retirement Assn. (1985) 39 Cal.3d 374, 396 (Hittle), citing Estate of Teel (1944) 25 Cal.2d 520, 527.)
Even setting aside the matters the court deemed Dean to have admitted (which are themselves fatal to this appeal), we find ample evidence from the trial to support the judgment. The outcome of this case boiled down to whether the court believed Sweida's account of the rent dispute or Dean's. Simply put, the court found Sweida the more credible witness.
Dean spends most of her appellate briefs recounting the testimony she and Walkley gave at trial and contending the court erred in discounting their side of the story. However, that type of argument is ineffective on appeal because "a reviewing court '"looks only at the evidence supporting the successful party, and disregards the contrary showing."'" (Hittle, supra, 39 Cal.3d at pp. 395-396.) Sweida provided the court with testimony and documentary evidence to support his breach of lease claim. His case was simple enough—although Dean had committed to lease the unit until November 30, 2014, he testified and his ledger reflected that she stopped paying rent after December 2013. Dean attempted to show otherwise, but was unable to persuade the court. We will not disturb the court's credibility determination.
In the remainder of her briefing, Dean renews her argument of immunity under Corporations Code section 5047.5. There are at least two glaring problems with this argument. First and most fundamentally, Dean failed to present the basic evidence to trigger the immunity provision—proof that Golda's House Animal Rescue Thrift And Boutique, the entity mentioned in the lease, is a nonprofit corporation. At trial, Dean testified the nonprofit corporation's name is Golda's House Animal Rescue, and she did not object or respond when Sweida's counsel said he was unable to find Golda's House Animal Rescue Thrift And Boutique when he searched the business entity database on the California Secretary of State's official website. Second, Corporations Code section 5047.5 applies only to claims arising out of a nonprofit corporation director's negligent acts or omissions, made in good faith, and "in the exercise of his or her policymaking judgment," and the decision whether to pay rent each month is not a policy decision. (Corp. Code, § 5047.5, subd. (b), italics added.)
III
DISPOSITION
We affirm the judgment. The parties shall bear their own costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
SLOUGH
J. We concur: RAMIREZ
P. J. CODRINGTON
J.