Opinion
B192641
4-26-2007
BRIAN ZINK, Plaintiff and Appellant, v. JUDICIAL WATCH, INC., Defendant and Respondent.
Aaronson and Aaronson and Arthur Aaronson for Plaintiff and Appellant. Candace E. Jackson for Defendant and Respondent.
NOT TO BE PUBLISHED
Brian Zink, doing business as Media Broadcast Services (appellant), appeals an order granting summary judgment against him and in favor of Judicial Watch, Inc. (respondent) on the grounds that appellants breach of contract claim is time-barred under the four-year statute of limitations set forth in Code of Civil Procedure section 337 (section 337). We affirm.
CONTENTIONS
Appellant contends that the trial court erred in granting summary judgment because (1) the contract was a joint venture agreement, and therefore no cause of action existed until such time as the joint venture was dissolved or there was an accounting between the parties; and (2) under the discovery rule, appellant had additional time to bring the action since respondent had a fiduciary duty to inform appellant that respondent would not complete its contractual obligations. Appellant further contends that the trial court erred in excluding certain paragraphs from his declaration on the grounds that they were irrelevant.
FACTUAL BACKGROUND
Appellant is an independent video producer and respondent is a nonpartisan educational foundation. In October 1999 the parties entered into a written agreement which obligated appellant to videotape a conference hosted by respondent and produce a "Conference Highlights" video. In exchange, respondent agreed to promote the video through various marketing channels, including respondents website and talk shows on which officers of respondent were interviewed. The agreement further provided that respondent would receive orders for the video, which appellant would fulfill. The parties agreed to a "50/50 joint-venture split" of sales revenues, less reimbursement for costs, but specified that "hard fulfillment costs — including video tape dubs, packaging, and shipping and handling — will be paid first."
Appellant videotaped the conference and produced a 42-minute video from footage of the conference, which was eventually titled Democracy Subverted. The video dealt with campaign finance reform. Appellant felt it was very topical during the period of time leading up to the 2000 presidential election.
On February 11, 2000, while the video was still in production, appellant wrote to respondent indicating: "our window to market runs from now through election day in November . . . . Lets not miss the opportunity."
The final version of the video was approved by respondent in June 2000. In August 2000, respondent paid about $1,500 to dub 500 copies. Appellant took possession of those copies and in August 2000, delivered 50 copies to respondent for use in its marketing efforts.
On August 24, 2000, appellant wrote to respondent again stating, "`Why is [respondent] not moving forward with marketing and distribution of Democracy Subverted? . . . Since last Spring, we have known and agreed that our critical window for Democracy Subverted promotion and sales is this election year . . . the window has now been narrowed to only about two months before the presidential election . . . Every day that passes with no forward movement in the marketing of these tapes puts [appellant] at risk of being unable to pay off owed production expenses . . . . Promotion and marketing is [respondents] job . . . . Is [respondent] going to live up to its part of the bargain and market these tapes? When?"
On October 9, 2000, appellant wrote to respondent, indicating that respondent "is breaching the agreement [respondent] signed with [appellant] last October." "It is now four months after [Democracy Subverted] was approved . . . for release, and [respondent] has performed none of the critical media promotions . . . . [¶] Precious time has been wasted. [Democracy Subverted] will be newsworthy only if released prior to the presidential election, which is now less than one month away!" The letter sought immediate action in order to avoid a dispute.
On March 15, 2001, appellant wrote a letter to respondent which summed up the history of the agreement and the parties actions since the time that the agreement was finalized. In it, appellant confirmed that respondent "fail[ed] to live up to its part of the bargain." The letter also complained, "[appellant has] not received one cent for hundreds of hours of work on [respondents] behalf, yet [appellant has] incurred over $3,000 in expenses." On February 10, 2005, two months before filing his complaint against respondent, appellant wrote respondent again in a letter which reviewed the history of the parties dispute. He wrote, "There is no way to figure exactly how much [appellant] might have earned had [respondent] actively marketed Democracy Subverted during the many months of media debate over campaign finance reform leading up to the 2000 presidential election . . . . Unfortunately, [respondents] breach of its marketing obligations denied [appellant] its chance for shared revenues in any amount . . . ." Thus, appellant directly connected respondents breach with its failure to market during the time period leading up to the 2000 presidential election.
PROCEDURAL HISTORY
Appellant filed his complaint on April 21, 2005, alleging a single cause of action for breach of contract. The trial court sustained respondents demurrer to the complaint, and appellant filed a first amended complaint on August 12, 2005. The first amended complaint also alleged a single cause of action for breach of contract.
On December 19, 2005, respondent filed a motion for summary judgment, or, in the alternative, summary adjudication, arguing, inter alia, that the four-year statute of limitations set forth in section 337 barred appellants claim. Respondents motion was supported by a separate statement of undisputed material facts and a declaration attaching 26 exhibits which consisted entirely of documents authored or authenticated by appellant. In his opposition, appellant did not dispute any of respondents undisputed material facts, but raised 17 additional undisputed facts.
On March 7, 2006, the trial court heard oral argument. Later that day, the trial court issued a minute order granting respondents motion for summary judgment. The court noted:
"It is undisputed that [appellant] believed the contract obligated [respondent] to promote and sell the video before the November 2000 election. It is undisputed that [appellant] charged [respondent] with breach of the contract in a letter dated October 9, 2000 . . . . It is undisputed that [appellant] wrote [respondent] a letter dated March 15, 2001, asserting that [appellant] had incurred damages as a consequence of [respondents] `failure to live up to its part of the bargain."
After noting that the statute of limitations for a cause of action for breach of contract accrues at the time of breach, the trial court held that section 337s four-year statute of limitations barred appellants lawsuit, which was not filed until April 21, 2005. This appeal followed.
DISCUSSION
I. Summary judgment was proper
A. Standard of review
A trial court properly grants summary judgment where no triable issue of material fact exists and the moving party is entitled to judgment as a matter of law. (Code Civ. Proc. § 437c, subd. (c).) We review the trial courts decision de novo. (Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465, 476.)
In reviewing a motion for summary judgment, we first identify the issues framed by the pleadings. We next determine whether the moving party has established facts justifying judgment in its favor. Third, if the moving party has carried its initial burden, we decide whether the opposing party has demonstrated the existence of a triable, material fact issue. (Varni Bros. Corp. v. Wine World, Inc. (1995) 35 Cal.App.4th 880, 886-887.)
B. Respondent has established that appellants claims are barred by section 337
Respondent argues that appellants sole cause of action for breach of contract is barred by the statute of limitations set forth in section 337. In order to determine whether appellants claim is barred by section 337, we must first determine when his cause of action accrued. A cause of action generally accrues when the cause of action is complete with all of its elements. (Fox v. Ethicon Endo-Surgery, Inc. (2005) 35 Cal.4th 797, 806.) A breach of contract cause of action is comprised of the following elements: (1) the contract, (2) plaintiffs performance or excuse for nonperformance, (3) defendants breach, and (4) resulting damages. (Careau & Co. v. Security Pacific Business Credit, Inc. (1990) 222 Cal.App.3d 1371, 1388.) A cause of action accrues when the party who owns it is entitled to bring and prosecute an action thereon. (April Enterprises, Inc. v. KTTV (1983) 147 Cal.App.3d 805, 822.)
Appellant does not dispute that section 337 applies to the breach of contract cause of action. We therefore assume it was properly applied.
Respondent has presented evidence that, at least three times between August 2000 and March 2001, appellant accused respondent in writing of breaching the parties contract. In August 2000, appellant beseeched respondent, "`Is [respondent] going to live up to its part of the bargain and market these tapes? When?" In October 2000, appellant directly stated that respondent was "breaching the agreement." And in March 2001, appellant again confirmed that respondent "fail[ed] to live up to its part of the bargain," and detailed the losses that appellant had suffered as a result. These letters present competent evidence that all four elements of appellants cause of action for breach of contract had accrued no later than March 15, 2001.
Appellant does not challenge these writings. He presents no evidence suggesting that he did not send these letters or express the accusations contained therein. It is also undisputed that appellant did not file his complaint in this action until April 21, 2005. Because section 337 sets forth a four-year statute of limitations for an action on any written contract, respondent has satisfied its initial burden of proof by establishing that appellants cause of action is barred as a matter of law.
Appellant challenges the trial courts "interpretation" of these writings. He argues that, contrary to the trial courts determination, the March 15, 2001 letter said nothing about damages. We disagree. While appellant did not use the word "damages," he clearly set forth monetary losses that he had incurred. We also note that appellants contention that "[a]n assertion by one party to a contract that the other has breached does not give rise to a cause of action" is irrelevant. Whether or not he asserted it at the time, his cause of action had accrued and he was aware of it.
C. Appellant has failed to show the existence of a triable, material fact as to whether section 337 bars his claim
Having determined that respondent has carried its initial burden, we must now decide whether appellant has demonstrated the existence of a triable, material issue of fact. Rather than dispute any of the evidence presented by respondent as to the timing of the events, appellant presents arguments as to why we should determine that his cause of action did not accrue when all of its elements were met.
1. The joint venture cases
Appellants first arguments are based on appellants position that the contract at issue was "clearly a joint venture agreement." Appellant attempts to draw parallels between this case and several cases involving disputes resulting from joint venture arrangements. For the reasons set forth below, we reject appellants arguments.
We need not address appellants assertion that "[t]he issue of whether the contract formed a joint venture agreement would . . . be a disputed issue of material fact" because, as we will discuss, even if it were a joint venture agreement, appellants claim for breach of contract would still be barred by section 337.
a. Danielan v. McLoney (1954) 124 Cal.App.2d 435, 441 (Danielan) and Stilwell v. Trutanich (1960) 178 Cal.App.2d 614, 620 (Stilwell)
Citing Danielan and Stilwell, appellant claims that there can be no action by one joint venturer against the other until the joint venture has been dissolved or there has been an accounting between the joint venturers. Because appellant did not request an accounting until June 23, 2003, he claims his action is not time-barred.
We note that the first amended complaint does not allege a joint venture agreement nor does it charge respondent with breach of a duty to a joint venture. Instead, it alleges a simple breach of contract. Therefore the statement in Danielan that "[a] joint adventurer has no cause of action for breach of duty owed to the venture until the firm has been dissolved and an accounting has been had" (Danielan, supra, 124 Cal.App.2d at p. 441), has no applicability. However, as discussed below, even if the contract between the parties were construed to be a joint venture agreement, Danielan would not prevent application of the statute of limitations under the circumstances before us.
In Danielan, a joint venture agreement for the purchase of property was executed in October 1946. Because the complaint was filed in January 1952, appellants argued that it was barred by section 337. The court corrected appellants by explaining that they "misconceive[d] the nature of the lawsuit" which was "predicated on appellants breach of their agreement promptly to pay respondents for losses incurred on account of the sale of the property, not for failure to make payments on the purchase price." (Danielan, supra, 124 Cal.App.2d at p. 441.) The court explained that the complaint was filed "within four months after respondents had ascertained the loss from the sale of the acreage and the expenses suffered therefrom." (Id. at p. 442.)
Thus, the Danielan court specifically noted that the respondents claim was not based on the appellants failure to live up to an initial obligation to pay the purchase price of the property, but was based on the parties agreement to cover losses once the property was sold. (Danielan, supra, 124 Cal.App.2d at p. 441.) The complaint was timely filed after discovery of that breach. Nothing in the opinion suggests that an allegation of breach of contract for a violation occurring over four years before the complaint was filed would not have been barred by section 337.
Stilwell is similarly inapplicable. In Stilwell, the issue on appeal was whether the trial court had properly sustained the defendants objection that the plaintiff had failed to state a claim "for an accounting to apportion losses incurred in connection with an alleged joint venture." (Stilwell, supra, 178 Cal.App.2d at p. 617.) The Stilwell court noted that, "[u]nder ordinary circumstances, the rights among joint venturers may be adjusted only in an action for an accounting" (id. at p. 620), and ultimately held that the complaint adequately stated such a cause of action. (Ibid.) Here, appellant has not alleged an action for an accounting. Summary judgment cannot be denied on a ground not raised by the pleadings (Bostrom v. County of San Bernardino (1995) 35 Cal.App.4th 1654, 1663), and appellants opposition to respondents summary judgment may not serve to amend his complaint.
b. April Enterprises, Inc. v. KTTV, supra, 147 Cal.App.3d 805 (April Enterprises)
Appellant next compares this case with April Enterprises. In that case, the plaintiff had entered into a written contract in 1965 involving the production of a television show. The defendants owned all videotapes of the show, but both parties had the right to initiate syndication of the show with third parties and profits from such syndication were to be split evenly. In a 1968 amendment to the agreement, defendants had the exclusive right to syndication but no longer had the right to erase the tapes of the show. The contract also provided for automatic termination in five years. (April Enterprises, supra, 147 Cal.App.3d at p. 814.)
In 1976 the plaintiff discovered that the tapes had been erased at some unknown date, and filed suit shortly after. (April Enterprises, supra, 147 Cal.App.3d at p. 814.) After its first amended complaint was dismissed on a motion for judgment on the pleadings, plaintiff appealed. (Id. at p. 815.) The Court of Appeal found that the plaintiff had stated a cause of action for breach of the implied covenant of good faith and fair dealing as to both the 1965 contract and the 1968 amendment, as well as a cause of action for breach of fiduciary duty by a joint venturer. (Id. at pp. 817-818.) In determining that plaintiffs claim was not barred by the statute of limitations, the Court of Appeal pointed out that "the first arguably actionable event was respondents erasure of the tapes since that was the moment appellant suffered appreciable harm for purposes of the causes of action asserted in this lawsuit." (Id. at p. 824, fn. omitted.) Although the court assumed that the erasure occurred in 1972, it applied the discovery rule in holding that the statute of limitations did not bar the plaintiffs causes of action for breach of fiduciary duty and breach of the implied covenant of fair dealing. The court noted that "the ultimate question is whether appellant exercised reasonable diligence in discovering respondents erasure of the tapes." (Id. at p. 833.)
Appellant argues that, under the "discovery rule," appellant had additional time to bring this action since respondent, as a joint venturer, had a fiduciary duty to inform appellant that it had no intention of promoting the video or had totally abandoned its efforts to do so. Citing April Enterprises, appellant argues that when the cause of action is against a fiduciary, the accrual of the cause of action is delayed until the plaintiff could have reasonably ascertained the injury.
In the circumstances before us, no factual question exists as to when appellant reasonably could have ascertained his injury. As shown by a letter he wrote to respondent unequivocally alleging a violation of the agreement, he discovered his injury as early as October 2000. Subsequent letters confirm appellants cognizance of respondents breach and specify appellants losses. Appellant does not deny these letters or the accusations contained therein. His complaint alleged a simple breach of contract, which the letters show he was aware of for more than four years. Whether or not respondent was a fiduciary, appellants complaint is time barred.
1. The allegations in the complaint
Appellants final argument asks us to look to the complaint, which alleges that the breaches of the contract occurred within the last four years. Appellant contends that there are triable issues of fact as to whether a breach occurred during that four-year period. For the reasons set forth below, we conclude that any such factual issues are immaterial.
This case comes to us after a motion for summary judgment, not a demurrer. Therefore, we may look beyond the pleadings to the evidence presented by the parties to determine whether the claims pleaded may survive. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843 ["[t]he purpose of the law of summary judgment is to . . . cut through the parties pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute"].)
The statute of limitations as to appellants breach of contract claim began to run as soon as he was entitled to a legal remedy. (Davies v. Krasna (1975) 14 Cal.3d 502, 513.) According to appellants own writings, the limitations period began to run as early as October 2000 and no later than March 15, 2001. The statute of limitations on appellants breach of contract claim commenced only once. Appellant has provided no authority for the proposition that a new limitations period begins with each subsequent breach. Therefore, any factual questions as to breaches within the four-year period leading up to the filing of the complaint are irrelevant.
In sum, we find that appellant has failed to show the existence of a triable, material issue of fact on the question of whether section 337 bars his claim.
II. The trial court did not abuse its discretion in excluding portions of appellants declaration
A. Standard of review
When reviewing a trial courts evidentiary rulings on a summary judgment motion, we apply the abuse of discretion standard. (Walker v. Countrywide Home Loans, Inc. (2002) 98 Cal.App.4th 1158, 1169.) Under that standard, a trial courts ruling will not be disturbed, and reversal is not required, unless the trial court exercised its discretion in an arbitrary, capricious, or patently absurd manner that resulted in a manifest miscarriage of justice. (People v. Guerra (2006) 37 Cal.4th 1067, 1113.)
B. The rulings
Appellant argues that the trial court erred in sustaining respondents objections to 11 paragraphs of appellants declaration, which was filed in support of appellants opposition to respondents summary judgment motion. The courts stated grounds for exclusion of these paragraphs were that they were irrelevant and the evidence contained within the paragraphs did not support the asserted supplemental fact.
Appellants argument as to the admissibility of these paragraphs focuses on their relevance. For example, in one of the excluded paragraphs, appellant stated that respondent responded to his letter of March 15, 2001, by telling him that he was "over-reacting." Without citing any legal authority, appellant argues that this raises a question of whether the statute of limitations was tolled. As another example, in one of the excluded paragraphs, appellant stated that he requested an accounting, which he claims evidences the continuation of the alleged joint venture and the "non-accrual" of appellants cause of action.
Appellant has failed to show that the trial court acted in an arbitrary or capricious manner in excluding the paragraphs. Other than listing the excluded paragraphs and declaring their relevance, appellant provides little support for his argument that the trial courts rulings should be disturbed. We therefore find no abuse of discretion.
C. The excluded evidence did not create a triable issue of fact
We have determined that the trial court did not abuse its discretion in sustaining respondents objections to certain paragraphs in appellants declaration. However, we further note that, even if the court erred in excluding this evidence, no miscarriage of justice resulted. As set forth below, the excluded information did not serve to contradict any of the facts established by respondent in support of its summary judgment motion.
Evidence of appellants reliance on respondents statement that he was "over-reacting" could not serve to toll the statute of limitations. Under such a theory, the statute of limitations would never expire so long as respondents assurances continued. According to appellants own letters, respondents breach was complete by March 15, 2001, at which time a cause of action for damages immediately arose. Appellants reliance for over four years on respondents statement that he was "over-reacting" — or on respondents assurances that respondent would promote the video — was unreasonable, and cannot serve to prevent application of the general rule that "`a cause of action accrues when a suit may be maintained thereon." (Fox v. Dehn (1974) 42 Cal.App.3d 165, 173.)
Appellants request for an accounting in June 2003 is similarly irrelevant to the central question of whether appellants breach of contract claim is barred by section 337. As we have discussed, appellants cause of action was for a simple breach of contract, not for an accounting or for breach of a duty to a joint venture. The uncontradicted evidence that appellants breach of contract cause of action accrued no later than March 15, 2001, serves to bar appellants claim regardless of any subsequent request for an accounting.
DISPOSITION
The order is affirmed. Respondent is awarded its costs on appeal.
We concur:
DOI TODD, Acting P. J.
ASHMANN-GERST, J.