Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment and an order of the Superior Court of Los Angeles County No. PC037603, Melvin D. Sandvig, Judge.
Law Office of Geoffrey A. Berkin, Geoffrey A. Berkin; Law Offices of Roger L. Stanard and Roger L. Stanard for Plaintiffs and Appellants.
Lee, Bazzo & Nishi, Ted M. Lee and Jin Nishi for Defendants and Appellants.
KLEIN, P. J.
Plaintiffs and appellants Alan B. Ungar and Catherine C. Ungar (collectively, the Ungars) appeal a judgment following a grant of summary judgment in favor of defendants and respondents Skinner Swim Pool Plastering, Inc. and Bryan Skinner (collectively, Skinner).
Skinner also appeals, seeking review of a postjudgment order denying its motion for attorney fees as the prevailing party under the contract and its request for expert costs.
The Ungars contracted with Skinner to replaster their swimming pool. The pool “popped up” after it was drained. The Ungars sued Skinner for negligence and breach of contract, alleging Skinner failed to take proper precautions to avoid swimming pool “pop-up” caused by hydrostatic pressure from ground water.
The essential issue presented is whether the Ungars’ action for negligence and breach of contract is barred by an exculpatory clause in the pool replastering contract.
For the reasons set forth below, the exculpatory clause by its terms is inapplicable. Therefore, the judgment is reversed with directions to reinstate the action. The postjudgment order re attorney fees and costs is vacated because the issue of attorney fees and costs is premature.
FACTUAL AND PROCEDURAL BACKGROUND
1. Overview.
On or about February 3, 2005, the Ungars and Skinner entered into a written contract for the replastering of a swimming pool at the Ungar home in Thousand Oaks. At the time, Southern California was experiencing an unusually heavy rainy season.
With respect to terms and conditions, the contract states in relevant part: “1. Contractor shall not perform his work under unfavorable weather conditions that in his opinion may adversely affect such work, except upon express instructions from owner, at which time owner assumes responsibility for such adverse effects. [¶] 2. Contractor shall not be liable for any damages for the project resulting from rain, flood, fires, earthquake, swelling of ground, hydrostatic pressure, or other acts of the elements, acts of other persons, government controls, acts of God, and non-issuance of permits. Contractor does not assume liability for any work performed by others. Any repairs will be done for an additional charge.”
After the pool was emptied, it suffered a “pop-up” due to hydrostatic pressure. The Ungars contended Skinner was negligent in failing to take reasonable precautionary measures, such as drilling holes in the concrete pool shell, to relieve the hydrostatic pressure as the pool was being drained.
2. Proceedings.
a. Pleadings.
On October 11, 2005, the Ungars filed suit against Skinner, seeking damages for breach of contract and negligence.
In addition to pleading the written contract, a copy of which was appended to the complaint, the Ungars pled the written agreement was orally modified. “Prior to commencing work, . . . Alan Ungar telephoned [Skinner] to inquire about the danger of a ‘pop-up’ . . . . Thereafter, the terms of the written agreement were orally modified when [Skinner] represented and warranted to . . . Alan Ungar that there was no danger of a ‘pop-up’ and that a ‘pop-up’ would not occur.” The Ungars further alleged Skinner breached its obligations under the contract by ceasing work on the project, despite the Ungars’ demand that Skinner complete the job in accordance with the contract.
The Ungars also pled Skinner negligently “failed to meet the community standard of swimming pool contractors by failing to take precautions to avoid swimming pool ‘pop-up’ caused by a high water table.”
b. Skinner’s motion for summary judgment.
On July 18, 2006, Skinner filed a motion for summary judgment. Skinner contended it was entitled to judgment as a matter of law on the ground that the contract “contains a valid, unambiguous and enforceable limitation of liability provision that prohibits plaintiffs from recovering for the damages alleged.” According to Skinner, the relief sought by plaintiffs was specifically prohibited by the provision in the contract that “Contractor shall not be liable for any damages for the project resulting from rain, . . ., swelling of ground, hydrostatic pressure, or other acts of the elements, . . . [or] acts of God[.]”
c. The Ungars’ opposition.
In opposition, the Ungars contended “the clause at issue does not clearly and expressly release Skinner from its own negligence. In addition, Skinner has provided no evidence that the cause of the ‘pop-up’ was anything other than its own negligence. Plaintiffs have alleged that the cause of the ‘pop-up’ was Skinner’s negligence and with this opposition, provide expert testimony that the cause of the damage was due to Skinner’s negligence. Finally, the complaint alleges that the parties’ written agreement was orally modified. Skinner offers no evidence to the contrary. Rather, Skinner relies upon a contractual clause which states that, ‘additional agreements between the parties must be signed by both parties and attached to the contract.’ The complaint does not allege an ‘additional’ agreement. Rather, it alleges an oral modification of the existing agreement removing the clause at issue. An oral modification of the existing agreement is not precluded by the express language of the parties’ contract raising a triable issue of fact regarding the terms of the parties’ written agreement. In the alternative, Skinner is estopped from asserting the clause as a defense after inducing Plaintiffs to proceed with the work after representing to them that there would be no risk of damage to the pool from rain.”
The opposition papers were supported by the declaration of Alan Ungar, which stated in relevant part: “Approximately one week before work was scheduled to commence on our swimming pool on March 1, 2005, I telephoned the office of Skinner Swim Pool Plastering, Inc. (‘Skinner’) and spoke to either Margaret or Kristy. I was concerned because I had reviewed the provision in the contract that stated that the contractor would not be liable for damages to ‘the project’ caused by the rain. At that time, we were experiencing an unusually heavy rain season. I asked Margaret/Kristy whether it would be safe to undertake this work given the amount of rain as I was very concerned about that. I did not want the work to commence if there was any risk of damage due to rain. She asked me to hold while she checked with someone else in the office. After a short time she came back on the telephone and told me ‘no’ that there was no problem with the rain and that it would be safe to proceed with the work. In reliance upon that assurance my wife and I authorized the work to proceed. Had I been advised that there was a risk of a ‘pop-up’ taking place if work commenced at that time, my wife and I would not have authorized the work to start.”
The opposition papers were further supported by the declaration of Michael S. Poles, a construction consultant and forensic expert witness. After conducting a site inspection and investigation of damages, Poles opined: “The Ungars’ swimming pool suffered what is commonly known in the construction industry as a ‘pop-up.’ A ‘pop-up’ occurs when the hydrostatic pressure caused by ground water is sufficient to float the pool like any vessel upward out of the ground. Ground water is a naturally-occurring event. Many areas in this region have high ground water tables including the San Fernando Valley and Thousand Oaks. When a pool is situated at the bottom of a slope, as is the case here, the risk of high ground water is greater because water naturally peculates [sic, this probably should state percolates] down slope. Swimming pools normally resist the forces imposed from hydrostatic pressure produced from ground water because the water within the pool is sufficiently heavy enough to offset the pressure on the bottom of the pool shell. Thus, the risk of pop-up occurs when a swimming pool is emptied. [¶] 4. I personally inspected the Ungars’ swimming pool to determine whether [Skinner] took precautionary measures to avoid a ‘pop-up.’ These measures include (a) opening a relief valve often installed on new pools or (b) drilling or breaking holes in the pool shell as the pool is being drained, in order to allow ground water to seep into the pool and thereby draining away as the pool is being drained. The Ungars’ pool had no relief valve and no holes were drilled nor broken out in the shell. [¶] 5. In my professional opinion the cause of the damage to the Ungars’ swimming pool was caused by the negligence of defendant Skinner in failing to take reasonable precautionary measures to relieve hydrostatic pressure.”
d. Evidentiary objections to the declaration of Alan Ungar.
Skinner objected on the ground of hearsay to the statement in Alan Ungar’s declaration that “She [i.e., Margaret or Kristy in Skinner’s office] asked me to hold while she checked with someone else in the office. After a short time she came back on the telephone line and told me ‘no’ that there was no problem with the rain and that it would be safe to proceed with the work.”
The hearsay objection should have been overruled. Evidence of a statement offered against a party is not made inadmissible by the hearsay rule if the statement was made by a person authorized by the party to speak for his or her employer. Here, Margaret or Kristy was at least impliedly authorized to make the statement for the employer. (Evid. Code, § 1222; O’Mary v. Mitsubishi Electronics America, Inc. (1997) 59 Cal.App.4th 563, 570.)
Skinner also objected to Alan Ungar’s assertion that “Had I been advised that there was a risk of a ‘pop-up’ taking place if work commenced at that time, my wife and I would not have authorized the work” on the ground that it was “speculative.”
The “speculative” objection should have been overruled. We find nothing speculative about Alan Ungar’s assertion that had he been advised of a risk of “pop-up” he would have delayed the job.
e. Trial court’s ruling.
On October 6, 2006, the trial court sustained Skinner’s evidentiary objections to the declaration of Alan Ungar and granted Skinner’s motion for summary judgment. The trial court ruled there were “no triable issue[s] of material facts and further, that the contract and negligence claims failed to state a cause of action upon which relief may be granted based upon the contract entered into by the parties.”
Judgment was entered on November 28, 2006. The Ungars filed a timely notice of appeal from the judgment.
f. Subsequent proceedings re attorney fees and costs.
On December 20, 2006, Skinner filed a motion for attorney fees as the prevailing party under the contract.
Skinner also requested an award of attorney fees and expert costs pursuant to Code of Civil Procedure section 998, in the total sum of $32,562.2.6.
On January 26, 2007, the trial court denied Skinner’s motion, stating: “The attorney fees provision in the contract provides that the owner agrees to pay the amount stated in the proposal for materials and labor performed. The attorney provision was narrowly drawn, and the provision only applies to actions filed to enforce payment. The Court further finds that the claims stated were so intermingled that apportioning the fees between the claims would be virtually impossible. [¶] On the issue of expert fees based on the Code of Civil Procedure [section] 998 offer the moving party has failed to show that it has complied with [section 998] in order to recover such fees.”
Skinner filed a timely notice of appeal from the postjudgment order.
CONTENTIONS
Ungar contends: the trial court misconstrued the exculpatory clause to exclude Skinner’s liability for its own negligence; the exculpatory clause is based on “Acts of God or Natural Events” and does not relieve Skinner of liability for ordinary negligence; if the exculpatory clause were interpreted to relieve Skinner of negligence, it would be unenforceable as against public policy; and Civil Code section 2782.5 (authorizing parties to construction contracts to negotiate with respect to release of liability) is inapplicable.
Skinner contends the trial court erred in denying its motion for attorney fees and expert costs.
DISCUSSION
1. Standard of appellate review.
Summary judgment “motions are to expedite litigation and eliminate needless trials. [Citation.] They are granted ‘if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.’ [Citations.]” (PMC, Inc. v. Saban Entertainment, Inc. (1996) 45 Cal.App.4th 579, 590.)
A defendant meets its burden upon such a motion by showing one or more essential elements of the cause of action cannot be established, or by establishing a complete defense to the cause of action. (Code Civ. Proc., §437c, subd. (p)(2); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849.) Once the moving defendant has met its initial burden, the burden shifts to the plaintiff to show a triable issue of one or more material facts exists as to that cause of action or a defense thereto. (Id. at p. 849.)
We review the trial court’s ruling on a motion for summary judgment under the independent review standard. (Rosse v. DeSoto Cab Co. (1995) 34 Cal.App.4th 1047, 1050.)
2. The exculpatory clause does not purport to absolve Skinner of liability for its own negligence, or for a breach of contract; therefore, the moving papers did not meet their initial burden on summary judgment.
a. General principles.
“ ‘Accompanying every contract is a common-law duty to perform with care, skill, reasonable expedience, and faithfulness the thing agreed to be done, and a negligent failure to observe any of these conditions is a tort, as well as a breach of the contract.’ The rule which imposes this duty is of universal application as to all persons who by contract undertake professional or other business engagements requiring the exercise of care, skill and knowledge; the obligation is implied by law and need not be stated in the agreement [citation].” (Roscoe Moss Co. v. Jenkins (1942) 55 Cal.App.2d 369, 376 [contract for the drilling of a well]; accord Allred v. Bekins Wide World Van Services (1975) 45 Cal.App.3d 984, 989 [contract to have personal effects packed and shipped]; Moreno v. Sanchez (2003) 106 Cal.App.4th 1415, 1427 [contract for professional home inspection].)
The law generally looks with disfavor on attempts to avoid liability or to secure exemption for one’s own negligence. (Queen Villas Homeowners Assn. v. TCB Property Management (2007) 149 Cal.App.4th 1, 6 (Queen Villas).) Civil Code section 1668 provides: “All contracts which have for their object, directly or indirectly, to exempt anyone from responsibility for his own fraud, or willful injury to the person or property of another, or violation of law, whether willful or negligent, are against the policy of the law.” Therefore, an exculpatory contract is valid only if the public interest is not involved. (Tunkl v. Regents of University of California (1963) 60 Cal.2d 92, 96 (Tunkl).)
Tunkl held “an agreement between a hospital and an entering patient affects the public interest and that, in consequence, the exculpatory provision included within it must be invalid under Civil Code section 1668.” (Tunkl, supra, 60 Cal.2d at p. 94.)
Being disfavored, exculpatory clauses are strictly construed against the party relying on them. Courts strictly construe the terms of exculpatory clauses against the defendant who is usually the draftsman. (Queen Villas, supra, 149 Cal.App.4th at p. 6.)
Where a two-party contract purportedly releases one side from liability to the other, “courts must look for clear, unambiguous and explicit language not to hold the released party liable. As [stated in Saenz v. Whitewater Voyages, Inc. (1990) 226 Cal.App.3d 758]: ‘Everyone agrees that drafting a legally valid release is no easy task. Courts have criticized and struck down releases if the language is oversimplified, if a key word is noted in the title but not the text, and if the release is too lengthy or too general, to name a few deficiencies. . . . However, we must remember that “[t]o be effective, a release need not achieve perfection . . . . It suffices that a release be clear, unambiguous, and explicit, and that it express an agreement not to hold the released party liable for negligence.” ’ [Citations].)” (Queen Villas, supra, 149 Cal.App.4th at pp. 5-6, italics added.)
The presence “of a clear and unequivocal waiver with specific reference to a defendant’s negligence is a distinct requirement where the defendant seeks to use the agreement to escape responsibility for the consequences of his negligence. [Citations.]” (Scroggs v. Coast Community College Dist. (1987) 193 Cal.App.3d 1399, 1404, italics added.)
By way of illustration, in Salton Bay Marina, Inc. v. Imperial Irrigation Dist. (1985) 172 Cal.App.3d 914 (Salton Bay), an exculpatory agreement between a public entity and various property owners provided: “ ‘[I]n consideration of the premises, the Parties of the First Part [the property owners] hereby covenant for themselves, their heirs, successors and assigns, not to sue the Party of the Second Part [Imperial County], its officers or employees, nor the Imperial Irrigation District, a public corporation, nor to hold said Second Party, its officers or employees, nor said Imperial Irrigation District responsible, in any manner whatsoever, for any damage or injury caused or occasioned by the rising of the Salton Sea, or any flooding or inundation of any portion of the said Bombay Beach Tract by said Salton Sea, now owned by said Parties of the First Part.” (Id. at p. 931, certain italics omitted.)
Salton Bay held the exculpatory agreement did not shield the irrigation district from liability for negligently flooding the plaintiffs’ property (Salton Bay, supra, 172 Cal.App.3d at p. 933), explaining: “For an agreement to be construed as precluding liability for ‘active’ or ‘affirmative’ negligence, there must be express and unequivocal language in the agreement which precludes such liability. [Citations.] An agreement which seeks to limit liability generally without specifically mentioning negligence is construed to shield a party only for passive negligence, not for active negligence. [Citations.] [¶] The agreements here fail to specifically exclude liability for active negligence in causing flooding. Thus these rules of law as well as the resolution of conflicting extrinsic evidence compel the conclusion the agreements precluded liability only if due to natural causes and not if due to the District’s own active negligence.” (Id. at pp. 932-933, italics added.)
In Salton Bay, the District “contend[ed] a construction limiting the agreement’s scope to flooding due to natural causes makes ‘no sense whatsoever’ since ‘[the District] never had control or legal responsibility for natural causes’ and such a construction would render the agreements ‘meaningless and interpreted in a manner that defeat[s] the express purpose . . . which was to permit [the District] to use plaintiffs’ land to deposit [the District’s] water.’ ” (Salton Bay, supra, 172 Cal.App.3d at p. 933.)
Salton Bay rejected that argument by the District, explaining: “When interpreting a written agreement, the courts are required to avoid an ‘absurd result’ (Civ. Code, § 1638), however, the courts are also required to give a construction which is lawful (Civ. Code, § 1643). While the District argues our interpreting the agreement to shield the District only from liability for naturally caused floods is an absurd result, we conclude if we were to construe the agreement as desired by the District, then we would reach an unlawful result for then the agreement would be an illegal exculpatory contract violating the public policies discussed in II infra. Under either view, the agreements do not shield the District from liability in this case.” (Salton Bay, supra, 172 Cal.App.3d at p. 933, italics added.)
By way of comparison, unlike the exculpatory clause in Salton Bay, the exculpatory clause in Tunkl (leaving aside the fact that it was invalid as contrary to public policy), specifically referred to the negligence of the released parties. There, the exculpatory clause “release[d] The Regents of the University of California, and the hospital from any and all liability for the negligent or wrongful acts or omissions of its employees . . . .” (Tunkl, supra, 60 Cal.2d at p. 94, italics added.)
b. The instant exculpatory clause does not purport to shield Skinner from liability for its own negligence, or for a breach of contract.
To reiterate, the instant exculpatory clause, found at paragraph 2 of the pool replastering contract, states: “Contractor shall not be liable for any damages for the project resulting from rain, flood, fires, earthquake, swelling of ground, hydrostatic pressure, or other acts of the elements, acts of other persons, government controls, acts of God, and non-issuance of permits. Contractor does not assume liability for any work performed by others. Any repairs will be done for an additional charge.” (Italics added.)
This clause releases Skinner from liability for damages resulting from rain, flood, fires, earthquake, swelling of ground, hydrostatic pressure, or other acts of the elements, acts of other persons, government controls, acts of God, and non-issuance of permits. Absent from the clause is any mention of damages resulting from Skinner’s own negligence.
Salton Bay is directly on point. There, the exculpatory clause shielded the District from liability for damage caused by “flooding” but did not specifically mention the District’s liability for negligence in causing flooding. (Salton Bay, supra, 172 Cal.App.3d at p. 933.) Therefore, the exculpatory clause was construed only to shield the District from liability for flooding due to natural causes and not flooding due to the District’s own negligence. (Ibid.)
By a parity of reasoning, the exculpatory clause shields Skinner from liability for damages caused by naturally occurring hydrostatic pressure, but does not shield Skinner from liability for damages resulting from its alleged negligence in draining the Ungars’ pool without drilling holes in the concrete to relieve the hydrostatic pressure of ground water, as pled in the second cause of action.
The exculpatory clause also does not purport to shield Skinner from liability for a breach of contract, which was the subject of the first cause of action. As noted, the Ungars pled, inter alia, Skinner breached the contract by ceasing work on the pool despite their demand that Skinner complete the work pursuant to the agreement.
In short, the exculpatory clause, by its terms, does not apply to any of the causes of action pled by the Ungars. Therefore, Skinner did not meet its initial burden, as a defendant moving for summary judgment, to establish a complete defense. (Code Civ. Proc., §437c, subd. (p)(2); Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at p. 849.) Accordingly, it is unnecessary to address whether the Ungars’ opposition papers raised a triable issue of material fact to resist summary judgment.
3. Remaining issues on Ungars’ appeal not reached.
Because the exculpatory clause does not extend to the causes of action pled in the Ungars’ complaint, it is unnecessary to address the Ungars’ contention that the pool replastering contract meets the Tunkl criteria for contracts affecting the public interest, or any other issues.
4. Skinner’s appeal.
Skinner contends the trial court erred in denying its motion for attorney fees as the prevailing party on the contract. Skinner also contends the trial court should have granted its motion for expert fees costs pursuant to Code of Civil Procedure section 998. The contentions do not detain us. Because the summary judgment is reversed and the action is reinstated, the issue of attorney fees and expert costs is premature.
DISPOSITION
The judgment is reversed with directions to reinstate the action. The postjudgment order re attorney fees and costs is vacated. The Ungars shall recover their costs on appeal.
We concur: CROSKEY, J., KITCHING, J.