Opinion
B295538
04-29-2020
WESTERN FUNDING INCORPORATED, Plaintiff and Respondent, v. VEGAS VALLEY MOTORS CORP., et al., Defendants and Appellants.
Law Offices of Christopher Keller and Christopher M. Keller for Defendants and Appellants. Madison Law and Jenos Firouznam-Heidari for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Los Angeles County Super. Ct. No. BC655813) APPEAL from a judgment of the Superior Court of Los Angeles County. Elizabeth R. Feffer, Judge. Affirmed. Law Offices of Christopher Keller and Christopher M. Keller for Defendants and Appellants. Madison Law and Jenos Firouznam-Heidari for Plaintiff and Respondent.
Vegas Valley Motors Corp. (VVM), Donald Grayson Cox Jr. (father), and Donald Grayson Cox III (son) (collectively "appellants") appeal from a judgment following a court trial that ended with a judgment in favor of plaintiff and respondent Western Funding Incorporated (WFI or respondent). WFI's lawsuit against appellants alleged damages as a result of appellants' failure to repurchase 302 retail installment sales contracts (RISCs) for the financing of used motor vehicles pursuant to the terms of the contract between the parties. Appellants argue that the trial court erred in that it (1) wrongly interpreted the contracts between the parties; (2) found personal liability on the part of both father and son; and (3) lacked substantial evidence to support the award of damages.
As the trial court noted in its statement of decision, because father and son have the same name, they were referred to as "dad/father" and "son" throughout the trial of this matter. Similarly, we use these terms to avoid confusion, and intend no disrespect to the parties.
No court reporter was present at trial. Therefore, an overarching issue, and subject of WFI's motion to dismiss, is whether the record is adequate for review of the issues on appeal. We find that the lack of a reporter's transcript in this matter precludes meaningful review of the issues raised, and requires that the issues be resolved against appellants. Therefore, we affirm the judgment.
BACKGROUND
The following facts are taken from the trial court's statement of decision after trial, the parties' agreed statement, and various documents filed with this court.
The documents are referred to in appellants' brief as trial exhibits. While the court's minute orders from trial contain lists of the exhibit numbers of evidence admitted on each day of trial, the documents themselves are not identified. There is no record of whether the use of any such document was restricted, and there is no record of the testimony surrounding each document. Thus, our ability to consider these exhibits is limited. (People v. Elkins (1992) 12 Cal.App.4th Supp.1, 4 [exhibits may not be considered without a record of the testimony given at trial]; Estate of Miller (1966) 243 Cal.App.2d 352, 353-354 ["the lack of a reporter's transcript of the evidence and of any other form of a record giving us the evidence taken at the trial, is not compensated for by the presence, in the clerk's transcript, of an exhibit admitted in evidence, there being silence as to the conditions or limitations attending its admission"].)
In August 2014, WFI entered into a purchase agreement with VVM. In March 2015, WFI and VVM entered into the second, operative purchase agreement (PA). In the PA, WFI agreed to purchase from VVM certain RISCs. On the same date, WFI entered into a personal guaranty (PG) in which both father and son agreed to "unconditionally, personally, and individually [g]uaranty to WFI for all amounts owed by VVM under the PA." It was undisputed that the son signed the guaranty. The signature was of "Donald Grayson Cox" with no differentiation between "Jr." or "III." The trial court "received testimony at trial that Son entered into the PG on behalf of Father, as was apparently their practice given the multitude of other personal guarantees that were executed in the same fashion." Thus, the trial court found father and son both subject to the personal guaranty "given their actions."
Paragraph 11 of the March 2015 PA provided:
The trial court referenced this agreement as a trial exhibit in its statement of decision, therefore we understand this document was admitted and considered at trial.
"It is understood and agreed that all Contracts purchased from DEALER shall be with full recourse and said full recourse shall continue until two (2) full monthly or four (4) full semi-monthly payments, as provided for in the Customer's Contracts, have actually been paid by the Customer to the COMPANY, at which time but not before, DEALER shall be released from the aforementioned full recourse stipulation as stated herein."
In August 2016, WFI and VVM entered into an Addendum to the PA (addendum). The addendum served to "modify and amend the [PA] as set forth herein in accordance with previous oral agreements between the parties to be applied to all deals for which DEALER has or will receive an Advance Enhancement beyond WFI's program guidelines." The addendum specified: "Once executed, this Addendum shall become part of the [PA] and shall apply to all deals referenced above."
The addendum was referenced in the trial court's statement of decision as an admitted trial exhibit.
The recourse provision in the addendum provided:
"It is understood and agreed that all Contracts purchased from DEALER which have been given an Advance Enhancement beyond WFI's program guidelines, shall be with full recourse and said full recourse shall continue for
the entire life of Contract. DEALER shall also be obligated under the remaining paragraphs of this Agreement, other warranties contained in the Contracts sold to COMPANY, and the obligations imposed by DEALER's assignment to COMPANY."
The addendum was signed by "D. Grayson . . . VP/Dir."
Between March 30, 2015, and November 23, 2016, WFI purchased 302 RISCs from VVM which were subject to the PA. The RISCs were included in seven pools. The PA included a triple pay payment (TPP) structure, which outlined the payments to be made by respondent to VVM. The first payment under the TPP was the advance payment WFI made to VVM for the purchase of each individual RISC. It was not disputed at trial that this payment was made for each individual RISC. The second payment was a discretionary payment. WFI was required to "'review the Dealer account for a pool payout'" nine to 12 months after the pool closing. A third payment is triggered when "(1) WFI has collected 50% of the scheduled finance charges; and (2) the principal reduction, which is account specific, is equal or greater than the amount WFI advances to VVM plus servicing, acquisition and product fees." WFI was entitled to withhold any payments in the event that VVM had outstanding indebtedness owed or if WFI felt reasonably insecure.
The trial court noted that numerous witnesses at trial testified that there existed a "special deal" for VVM. This oral deal was agreed to between WFI's then-president, Guerin Senter, with son. Pursuant to this oral agreement, WFI would purchase all of the RISCs offered to it by VVM, regardless of whether those RISCs met WFI's underwriting guidelines. A primary issue at trial was whether those otherwise unqualified RISCs were subject to full recourse, or a one-payment recourse. The trial court noted that there was conflicting testimony on this question at trial, despite the language of the addendum: "It is understood and agreed that all Contracts purchased from [VVM] which have been given an Advance Enhancement beyond WFI's program guidelines, shall be with full recourse and said full recourse shall continue for the entire life of Contract." The addendum, with the full recourse provision, applied retroactively to all RISCs purchased from VVM by WFI.
Pursuant to the PA and the addendum's full recourse provision, VVM was obligated to repurchase a RISC from WFI upon a customer's default of the obligations of the RISC. The court received evidence that "contrary to the terms of the PA, the Addendum, and the PG, [appellants] failed to repay WFI on RISCs that were funded . . . despite repeated demands for repayment starting as early as August of 2016." Evidence at trial showed that WFI deemed VVM to be in breach of the PA, PG, and addendum, due to VVM's failure to timely repurchase all RISCs subject to recourse.
PROCEDURAL HISTORY
In March 2017, WFI filed a complaint for breach of contract against VVM and "Donald Grayson Cox" seeking $656,444 as a result of VVM's failure to make payments to WFI for repurchase of deals pursuant to the terms of the contracts. WFI filed its first amended complaint in April 2017.
On May 26, 2017, VVM and Donald Grayson Cox filed a cross-complaint.
On July 27, 2018, WFI filed an amendment to the complaint to add Donald Grayson Cox III (son) as Doe 10.
On August 1, 2018, a final status conference was held. The parties stipulated that both father and son would be a part of the litigation as defendants.
The matter proceeded to a court trial from August 1-3, 2018. Prior to trial, the parties filed a joint list of stipulated facts that described the numerous RISCs at issue. No court reporter was present during the trial.
On August 3, 2018, at the conclusion of evidence, the court issued a briefing schedule in lieu of closing arguments.
On September 17, 2018, the trial court issued its proposed statement of decision. On October 2, 2018, father and son filed written objections to the proposed statement of decision. On October 31, 2018, WFI filed responses to the objections.
The trial court filed its statement of decision on November 6, 2018. The court found that VVM breached its obligation to repurchase RISCs that were subject to full recourse. It further found that every deal at issue in this lawsuit was purchased subject to the full recourse terms laid out in the addendum. By failing to repurchase the outstanding buybacks, VVM did not satisfy the condition precedent to trigger the TPP payments, therefore WFI was not obligated to make any payments to VVM.
Regarding the personal liability of father and son, the trial court found:
"[I]n their closing briefs [appellants] do not argue that liability under the PG should be limited only to Father, or to Son. Father and Son stipulated that they are both Defendants. Therefore, the court need not analyze the issue of Son's signature binding Father on the salient documents. Both Father and Son are liable as personal guarantors under the PG."
The court found that as of trial, $1,736,761.13 was owed by appellants to WFI on the RISCs at issue. It further found that appellants had failed to meet their burden of proof on the causes of action for breach of contract and common counts in their cross-complaint against WFI. On November 6, 2018, judgment was entered in favor of WFI and against appellants in the amount of $1,736.761.13. The court noted that father and son are both personally liable under the PG.
On November 20, 2018, father and VVM filed a notice of intention to move for new trial. On November 21, 2018, son filed a notice of intention to move for new trial. On November 30, 2018, appellants filed their memorandum of points and authorities in support of their motion for new trial, including supporting declarations.
The court heard the motion for new trial on December 18, 2018. On January 7, 2019, the court issued a written memorandum of decision denying the motions for new trial.
On February 1, 2019, appellants filed their notice of appeal from the order denying their motion for new trial.
DISCUSSION
I. Motion to dismiss appeal for lack of adequate record -- applicable law
A preliminary issue is appellants' failure to provide a record of the proceedings below. During the briefing of this matter, this court ordered the parties to brief the issue of "whether the absence of a reporter's transcript or suitable substitute of the relevant hearings warrants affirmance based on the inadequacy of the record." (See Foust v. San Jose Construction Co., Inc. (2011) 198 Cal.App.4th 181 (Foust) and cases cited therein.) Both parties briefed the issue, and respondent has filed a motion to dismiss the appeal and request for sanctions on the ground that appellants have failed to provide a record sufficient for meaningful review.
"[D]ismissal of an appeal may be warranted in the absence of a reporter's transcript when such a transcript is necessary for meaningful review. [Citation.]" (Bel Air Internet, LLC v. Morales (2018) 20 Cal.App.5th 924, 933.) California Rules of Court, rule 8.120(b) requires a reporter's transcript on appeal only if "appellant intends to raise any issue that requires consideration of the oral proceedings in the superior court." Thus, an appellant may elect to proceed without a reporter's transcript. (See Chodos v. Cole (2012) 210 Cal.App.4th 692, 699.) Where the appeal involves only pure legal issues based on the filings before the court, the appellate court may proceed with a de novo review. (Ibid.) However, where an appellant's challenge to the trial court's ruling relies on trial testimony, the lack of a reporter's transcript can be fatal to the appeal. (Foust, supra, 198 Cal.App.4th at p. 186.)
"The reason for this [rule] follows from the cardinal rule of appellate review that a judgment or order of the trial court is presumed correct and prejudicial error must be affirmatively shown. [Citation.]" (Foust, supra, 198 Cal.App.4th at p. 187.) In the absence of a reporter's transcript, all presumptions in favor of the trial court's action will be made. (Ibid.) Where the appellant provides a record that is inadequate for mean0ingful review, "'"the appellant defaults and the decision of the trial court should be affirmed."' [Citation.]" (Ibid.) "Failure to provide an adequate record on an issue requires that the issue be resolved against" the appellant. (Hernandez v. California Hospital Medical Center (2000) 78 Cal.App.4th 498, 502.)
Appellants argue that this court should not imply findings favorable to the judgment in this matter because appellants submitted objections to the proposed statement of decision bringing such omissions to the court's attention. In support of this argument, appellants cite In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1133, citing Code Civ. Proc., § 634.) Code of Civil Procedure section 634 provides that "[w]hen a statement of decision does not resolve a controverted issue, or if the statement is ambiguous and the record shows that the omission or ambiguity was brought to the attention of the trial court . . . it shall not be inferred on appeal . . . that the trial court decided in favor of the prevailing party as to those facts or on that issue." Here, appellants do not contend that the trial court failed to resolve any controverted factual issue. Instead, appellants complain that the trial court wrongly decided, or did not fully set forth its reasoning, as to those issues. The trial court was not required to do so. "[I]t is settled that the trial court need not, in a statement [of] decision, 'address all the legal and factual issues raised by the parties.' [Citation.]" (Yield Dynamics, Inc. v. TEA Systems Corp. (2007) 154 Cal.App.4th 547, 559.) The court is only required to set forth "'ultimate findings rather than evidentiary ones.' [Citation.]" (Ibid.) In this matter, the trial court set forth the ultimate findings in the case. It was not required to do more in order for us to apply presumptions of correctness in favor of the judgment.
The question of whether the record in this appeal is sufficient without a reporter's transcript is therefore dependent upon the nature of the issues raised. As set forth below, the issues raised by appellant require understanding and analysis of the evidence received and considered at trial. In the absence of a reporter's transcript, we are left with no choice but to affirm the judgment.
Relevant case law suggests that affirmance, not dismissal, is the appropriate action for this court where we are unable to undertake meaningful review. (See Foust, supra, 198 Cal.App.4th at p. 186, and cases cited therein.) Therefore, we deny respondent's motion to dismiss the appeal.
II. Applicable law and standard of review on appeal
Broadly speaking, the issues appellants raise in this appeal involve the trial court's interpretation of the various contracts between the parties, including the PA and the addendum, the PG, and the numerous RISCs. Further, the trial court identified as one of the primary issues at trial whether there "existed a 'special deal' for VVM entered into by WFI's then-President," which was contingent upon full recourse of each RISC signed. Because the trial court's task was to determine the terms of the contractual relationship between the parties, we review the rules of contract interpretation.
When the meaning of a contract is disputed, the trial court must "'provisionally receive any proffered extrinsic evidence which is relevant to show whether the contract is reasonably susceptible of a particular meaning.'" (Wolf v. Superior Court (2004) 114 Cal.App.4th 1343, 1350 (Wolf).) This is so even if a contract appears unambiguous on its face, since a latent ambiguity may be exposed by extrinsic evidence. (Ibid.)
"The interpretation of a contract involves 'a two-step process: "First the court provisionally receives (without actually admitting) all credible evidence concerning the parties' intentions to determine 'ambiguity,'i.e., whether the language is 'reasonably susceptible' to the interpretation urged by a party. If in light of the extrinsic
evidence the court decides the language is 'reasonably susceptible' to the interpretation urged, the extrinsic evidence is then admitted to aid in the second step -- interpreting the contract. [Citation.]" [Citation.]'"(Wolf, supra, 114 Cal.App.4th at p. 1351.)
"'The trial court's determination of whether an ambiguity exists is a question of law, subject to independent review on appeal.'" (Wolf, supra, 114 Cal.App.4th at p. 1351.) If no parol evidence is admitted, or if the parol evidence is not in conflict, the trial court's interpretation is also subject to de novo review. (Ibid.) However, where, as here, the parol evidence is in conflict, "'[t]he trial court's resolution of that conflict is a question of fact and must be upheld if supported by substantial evidence.'" (Ibid.) In particular, where two plausible interpretations of a contract can be made, "'parol evidence is admissible to aid in interpreting the agreement, thereby presenting a question of fact.'" (Ibid.)
In this matter, the trial court took extensive extrinsic evidence, in the form of three days' worth of trial testimony, to reach its conclusion regarding the obligations between the parties before us. Without a transcript of that testimony, along with statements concerning the parties' actions and intentions, we are unable to determine if substantial evidence supports the trial court's decision. Therefore, the lack of a reporter's transcript prohibits our review of the issues on appeal.
The parties did file an "agreed statement" pursuant to California Rules of Court, rule 8.134. The agreed statement provides the nature of the action, the basis of this court's jurisdiction, a procedural history of the matter, and "additional relevant facts." These additional facts are largely a repetition of the facts found by the trial court in its statement of decision. The agreed statement does not contain summaries of the testimony provided at trial of any witness, as would be necessary for a substantial evidence review. Unlike a settled statement under rule 8.137, the agreed statement does not contain a "concise factual summary of the evidence and the testimony of each witness relevant to the points that the appellant" is raising on appeal. (Rule 8.137(d)(2)(A).) Appellants do not cite to, or rely on the agreed statement in support of their arguments on appeal. Thus, the agreed statement is an insufficient substitute for a reporter's transcript in this matter.
III. A reporter's transcript is necessary for meaningful review
Appellants' challenges to the trial court's findings cannot be resolved without the reporter's transcript. We address each issue raised by appellants briefly below.
A. Trial court's disregard of single-payment recourse
Appellants' first argument on appeal is that the trial court arbitrarily disregarded language in the PA and the individual RISCs that all RISCs between August 2014 and March 2015 were subject to single payment recourse.
However, the trial court took extensive testimony on the significance of the various agreements between the parties. It concluded that "[t]he PA and the Addendum govern[ed] the relationship" between the parties. Further, it is apparent from the trial court's decision that one of the primary issues at trial was whether there existed an "oral deal whereby WFI would purchase all of the RISCs offered to it, regardless of whether those offered RISCs met WFI's underwriting guidelines." This "'special deal'" included a contingency that VVM give "full recourse in each RISC assigned." The trial court noted that the addendum contained language supporting the existence of such a special deal. The addendum provided that "'[i]t is understood and agreed that all Contracts purchased from [VVM] which have been given an Advance Enhancement beyond WFI's program guidelines, shall be with full recourse and said full recourse shall continue for the entire life of Contract.'" The trial court further noted that the addendum applied retroactively.
It is apparent that the trial court relied on oral evidence, as well as the documents in question, to reach its conclusion as to the applicable recourse provision. There is no suggestion in the record that the trial court disregarded any evidence before it. In its statement of decision, the court was not required to "specify the particular evidence considered" in reaching its final determination. (Aviointeriors Spa v. World Airways, Inc. (1986) 181 Cal.App.3d 908, 913-914 (Aviointeriors), citing Code Civ. Proc., § 632.)
Code of Civil Procedure section 632 governs statements of decision. It provides that the trial court's statement of decision must explain "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." A detailed recitation of the evidence considered is not required.
Without access to the trial testimony concerning the existence of a special deal, or the trial testimony concerning the parties' intentions with respect to the addendum, we cannot provide meaningful review of the evidence regarding the applicable recourse provision. Thus, we must presume the court's decision was correct, and resolve this issue against appellants. (Foust, supra, 198 Cal.App.4th at p. 187.)
B. Scope of personal guarantee
Appellants' second issue involves the scope of the PG executed by the son on behalf of father and son. The PG was signed in March 2015, simultaneous with the signing of the operative PA. However, appellants point out that the addendum was not signed until August 2015. Thus, appellants argue, father and son could not be personally liable under the August 2015 addendum.
The court noted that while it was undisputed that the son signed the PG, "[t]he court received testimony at trial that Son entered into the PG on behalf of Father, as was apparently their practice . . . ." Further, the court found father and son were both subject to the PG "given their actions."
In support of this argument, appellants cite Civil Code section 2792, which provides: "Where a suretyship obligation is entered into at the same time with the original obligation, or with the acceptance of the latter by the creditor, and forms with that obligation a part of the consideration to him, no other consideration need exist. In all other cases there must be a consideration distinct from that of the original obligation." Appellants argue that there was no separate consideration in connection with the addendum, but because the liability was greater, a new guaranty was required to be signed with independent consideration. Appellants argue that the trial court made an "assumption" that the PG continued to the new, greater and different terms of the addendum.
Civil Code section 2837 provides that "[i]n interpreting the terms of a contract of suretyship, the same rules are to be observed as in the case of other contracts." Thus, the court was required to at least provisionally consider extrinsic evidence when determining the scope of the PG. (Wolf, supra, 114 Cal.App.4th at p. 1350.) "The question of whether a guaranty is a continuing one is to be determined by reference to all relevant surrounding circumstances." (Berg Metals Corp. v. Wilson (1959) 170 Cal.App.2d 559, 569).
Appellants are correct that in its statement of decision, the trial court does not explain its reasoning, nor the evidence supporting its decision, that both father and son are liable for the breach of contract as personal guarantors under the PG. However, the trial court was not required to explain its reasoning. Code of Civil Procedure section 632 requires only that the trial court "clearly defin[e] [its] ultimate findings and the grounds upon which they are based." (Aviointeriors, supra, 181 Cal.App.3d at pp. 913-914.) Further, we note that the language of the guaranty is broad, warranting that:
"Guarantor unconditionally, personally and individually, guarantees the prompt full payment and performance of all obligations, conditions, covenants and agreements of [VVM] that are or may become due and owing to [WFI], including, but not limited to, all obligations arising out of the Purchase Agreement or any other agreement between [VVM] and [WFI] as if the Purchase Agreement and any other agreement was signed between [VVM] and Guarantor."
The language further specified that the guaranty "will not be affected in any way by the modification, extension, or renewal of any agreement between [VVM] and [WFI]." This language is sufficiently broad to encompass obligations created under the addendum.
In addition to this broad language, the trial court considered three days' worth of testimony regarding the relationship between the parties. Appellants point to no specific evidence -- testimonial or otherwise -- that suggests that the parties intended the PG to be restricted to pre-addendum transactions. Under the circumstances, we must presume that the evidence supported the court's decision, and resolve this issue against appellants. (Foust, supra, 198 Cal.App.4th at p. 187.)
C. Assessment of personal liability for both father and son
Appellants' next argument is that the trial court had no legal or factual support for its assessment of personal liability against both father and son. Appellants argue that the PG was signed with just one name, Donald Grayson Cox. The parties agreed that it was the son who signed the document. The address provided was the location of the business. Appellants argue that either son, signing in his capacity as Vice President of the business, or father, as the owner of the business, is liable under the PG, but not both.
Although appellants frame this as a legal issue, they cite no law supporting their position that both individuals cannot be liable under the PG. In fact, the trial court's decision on this issue appears to be largely factual. The court's minute order from the first day of trial notes that the parties stipulated that both father and son would be "a part of this litigation as Defendants."
Respondents assert that the minute order does not provide all details of the stipulation and other oral statements and agreements of counsel at that hearing. Respondents contend that the stipulation went beyond father and son both being defendants with father and son agreeing to coextensive personal liability.
Appellants raised an objection to the trial court's statement of decision below concerning the trial court's imposition of personal liability on both father and son. In response to appellants' objection, the trial court explained that the issue of father's and son's liability under the PG "was the subject of a considerable amount of argument prior to the court commencing the trial of this matter." In other words, the court explained it "was not a controverted issue, but, rather, was the subject of a pre-trial stipulation." Without a transcript of the hearing, we have no way to verify the details of the stipulation.
In addition to the pre-trial stipulation, the court elaborated on the significance of the PG in its statement of decision, explaining that it "received testimony at trial that Son entered into the PG on behalf of Father, as was apparently their practice given the multitude of other personal guarantees that were executed in the same fashion." Given the actions the court considered at trial, it concluded that father and son were both subject to the PG.
The parties' agreed statement also notes that "Father and Son are both subject to the PG given their actions."
Again, we have no way to evaluate this issue in the absence of a reporter's transcript. Only the arguments and evidence received by the court at trial can explain its decision, and we have no means to review such arguments and evidence. The trial court was not required to specify the evidence it relied upon. (Aviointeriors, supra, 181 Cal.App.3d at pp. 913-914.) Under the circumstances, we must presume the court's decision was supported by the evidence and arguments presented both pretrial and during trial, and resolve this issue against appellants. (Foust, supra, 198 Cal.App.4th at p. 187.)
D. The award of damages
Appellants challenge the award of damages in the amount of $1,736,761.13. The trial court concluded that appellants owed this amount to respondent at the time of trial based on evidence received at trial, "including . . . the trial testimony of Daylene Williams."
In support of their argument that the award is excessive, appellants cite conflicts in the evidence. Specifically, appellants argue that the testimony of Daylene Williams did not correlate with the summary of the RISCs entered into evidence. Appellants proceed to describe the status of the various RISCs. They argue that the testimony of Williams was not represented within the relevant document and was speculative; and that the trial court awarded respondent a "windfall," including the amount of outstanding contracts as well as existing revenue streams.
It is impossible for this court to evaluate the evidence supporting the trial court's award of damages without a reporter's transcript. Because the testimony of Williams was critical to the trial court's decision, a review of that testimony is necessary. Under the circumstances, we must presume the court's decision was correct, and resolve this issue against appellants. (Foust, supra, 198 Cal.App.4th at p. 187.)
IV. Respondent's request for sanctions
In its motion to dismiss this appeal, respondent has requested that sanctions be imposed against appellants and their counsel on the grounds that this amounts to a frivolous appeal. Respondent argues that the appeal is frivolous because appellants sought review for sufficiency of the evidence without a reporter's transcript or suitable substitute. Further, respondent argues that appellants' appendix violated the Rules of Court, causing significant expense to respondent, and that appellants refused to engage in a meaningful discussion regarding the issues raised in respondent's motion to dismiss.
An appeal "should be held to be frivolous only when it is prosecuted for an improper motive -- to harass the respondent or delay the effect of an adverse judgment -- or when it indisputably has no merit." (In re Marriage of Flaherty (1982) 31 Cal.3d 637, 650.) While appellants had no reporter's transcript available for this appeal, there is no suggestion that the appeal was brought for an improper motive. The parties' failure to utilize a court reporter at trial has hurt appellants' case on appeal, but it does not constitute bad faith. And while the appendix is not perfect, appellants provided 13 volumes of documents consisting of nearly 2,000 pages. Thus, appellants' appendix was far more thorough than the partial clerk's transcript provided in Foust, which consisted of only six documents. (See Foust, supra, 198 Cal.App.4th at pp. 188-189 [imposing sanctions for appeal based on "select documents" and appellant's "self-serving assertion[s]"].)
An "essential corollary" to our power to punish attorneys and parties for prosecuting frivolous appeals is it "should be used most sparingly to deter only the most egregious conduct." (In re Marriage of Flaherty, supra, 31 Cal.3d at pp. 650-651.) Under the circumstances before us, we decline to find this appeal to be frivolous, and deny respondent's request for sanctions.
DISPOSITION
The judgment is affirmed. Appellants are to bear the costs of appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
/s/_________, J.
CHAVEZ We concur: /s/_________, P. J.
LUI /s/_________, J.
ASHMANN-GERST