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Shaffer v. Wallace

Shaffer v. Wallace
10:28:2007



Shaffer v. Wallace



Filed 9/25/07Shaffer v. Wallace CA2/7



NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.



IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA





SECOND APPELLATE DISTRICT





DIVISION SEVEN







GENE SHAFFER,





Plaintiff and Appellant,





v.





OTIS WALLACE,





Defendants and Respondents.





B189371





(Los AngelesCounty



Super. Ct.No. PC035043)









APPEAL from a judgment of the Superior Court of Los Angeles County, Michael J. Parrell, Judge. Affirmed in part and reversed in part.



Michael J. Perry for Plaintiff and Appellant.



Woodard & Woodard, Daniel J. Woodard and Linda Torossian for Defendant and Respondents.



____________________













Gene Shaffer appeals from the judgment entered against him on his complaint for partition and an accounting against Otis Wallace and Gonzalo Posada and in favor of Wallace on Wallaces cross-complaint for partition and damages. Shaffer contends the trial courts equitable rulings on the partition and accounting causes of action were premised on a finding of fraud for which there was insufficient evidence. He also argues the court erred in allowing Wallace to amend his cross-complaint to conform to proof at trial and awarded inconsistent and unauthorized remedies to Wallace and Posada. Finally, he contends the award of expert costs was improper. With the exception of the award of costs, we affirm.



FACTUAL AND PROCEDURAL BACKGROUND



In 1982 Wallace and his brother purchased two parcels of land (the Foothill and Osborne properties) in Lake View Terrace and started a horse-boarding business known as Wallace Ranch Livery Stables. Wallace applied for, and received, a conditional use permit to allow the business to stable 70 horses over the two parcels. Wallace, however, appears to have fallen on hard times during the last decade or so. His brother was severely disabled in an accident; and Darron, Wallaces nephew, became a co-owner of the Osborne parcel with Wallace.[1] After a series of struggles between Wallace and Darron over control of the property, Darron filed for bankruptcy protection in 1999, prompting Wallace to file an adversary action in the bankruptcy court. As part of the settlement of that action in November 2002, the bankruptcy court valued the Osborne property at $450,000 and authorized Wallace or his designee to purchase Darrons half-interest in the property no later than January 27, 2003. If Wallace was unable to purchase Darrons half-interest by that date, the property would be sold, the conditional use permit invalidated and Wallace would lose his business.



Wallace faced a major hurdle in orchestrating the purchase of Darrons half-interest: He himself had been forced into involuntary bankruptcy the previous year and had dismal credit. In what must have seemed like a good idea at the time, Wallace turned to his friend Shaffer, who had long praised Wallaces business and had expressed interest in helping him. Shaffer had what Wallace needed ‑‑ excellent credit. The two men devised a plan to enable Wallace to retain his interest in the property and continue his business. Under the plan as originally understood by Wallace, he would quit-claim his own half-interest to Shaffer, who would then obtain a loan for the financing necessary to purchase Darrons half-interest using the property as collateral for the loan. The lender would pay off the existing mortgage on Darrons half-interest and pay the bankruptcy estate the value of Darrons equity. Shaffer would then quit-claim Wallaces half of the property back to Wallace, plus half of the remaining interest. The cost of the new loan would be covered by the income from the property. In short, Shaffer stood to gain ownership of a quarter-interest in the Osborne property simply by allowing his credit to support the transaction.



Unfortunately for Wallace, this handshake deal was never documented,[2]and, as he considered the deal, Shaffer apparently saw greater personal opportunities. He learned from Darron a neighbor had offered to purchase the Osborne property for $1 million if Darron could eliminate Wallaces interest. (Wallace was adamantly opposed to selling.) Then, without consulting Wallace, Shaffer offered Posada, another friend, the opportunity to invest in the property. In exchange for an investment of $50,000 Posada was to receive a partial interest in the property. Again, the absence of any writing masked Shaffer and Posadas lack of agreement on the type or size of Posadas proposed interest. Posada testified he simply trusted his long-time friend Shaffer.



Four days before the close of escrow Shaffer told Wallace the terms of the deal had changed. Wallace, meanwhile, had dropped other efforts to secure financing for the deal and faced the unpalatable choice of proceeding with Shaffer or abandoning the property for sale to a third party on the open market. He decided to proceed with the sale to Shaffer although he appears to have understood Posada was now part of the deal and would receive an equal share of Darrons interest.[3]



After the close of escrow Shaffer demanded Wallace execute a $150,000 note in Shaffers favor in exchange for the reconveyance of his share of the property.[4] In turn Shaffer transferred a three-ninths (or one-third) interest in the property back to Wallace, a one-ninth interest to Posada and retained a five-ninths interest for himself.



Surprisingly neither Wallace nor Posada challenged Shaffers action. While Posada testified he did not want to jeopardize his friendship with Shaffer, it is not apparent from the record Wallace understood what had happened to his ownership interest. He testified he thought he had received a one-third interest on Darrons half of the property ‑‑ in addition to the half he already owned ‑‑ and only wanted to be left alone to run his business. Alas, Shaffer did not leave well enough alone. He courted potential buyers for the property and initiated a series of unilateral improvements to the property, including the construction of additional stables he rented for his own benefit notwithstanding the long-standing limitation imposed by the conditional use permit. He then charged Wallace and Posada for expenses associated with the improvements and ongoing maintenance of the property. At some point Shaffer told both men he wanted to kick Wallace off the property. Not long after, Shaffer and Wallace quarreled and stopped speaking to each other; and, whether Shaffer stopped accepting payments from Wallace on the note or Wallace stopped making payments, Wallace became delinquent on the note.



In June 2004 Shaffer filed a complaint against Wallace and Posada seeking partition of the property by sale according to the respective rights of the parties and an accounting of all rents and profits derived from the property. Wallace filed a cross-complaint against Shaffer seeking partition and damages for interference with his business. The trial was bifurcated. In the first phase the trial court determined the property was worth $1.5 million. That valuation is not contested here. In a second phase the parties testified about their respective understandings of the deal and the income and expenses of the property at issue in the accounting. While none of the witnesses was particularly coherent on the stand, it is plain the trial court soon lost faith in Shaffers credibility. At the end of the second day the judge stated, I find Mr. Wallace and Mr. Posadas credibility to be high. I find Mr. Shaffers credibility to be low. I do. I find that probably the biggest mistake Mr. Wallace made was going into business with Mr. Shaffer. The court also granted Wallaces oral motion to amend his cross-complaint to conform to the proof at trial that Shaffer had fraudulently induced Wallace and Posada to enter into the deal.



At the close of testimony the court issued its findings on the record. In essence the court found the deal had been structured as described by Wallace. Shaffer altered the deal when he learned before escrow closed the property was worth at least $1 million, deeded himself a five-ninths interest after the deal closed to gain control of the property and acted wholly in his own self-interest instead of the mutual interest of the three co-owners. Based on these findings the court concluded Shaffer had induced Wallace and Posada to enter into the deal through fraud and undue influence, the remedy for which was a realignment of the parties respective property interests. After allowing the parties to brief appropriate remedies, the court issued a judgment imposing a resulting trust on the property, rescinding the deeds of record and repartitioning the property to give Wallace an undivided four-sixths interest, Posada an undivided one-sixth interest and Shaffer an undivided one-sixth interest. In addition Shaffer remained the sole obligor on the promissory note to the lender (which was secured by a deed of trust on the property), and Wallace remained liable to Shaffer on the $150,000 note. On the accounting causes of action, the court adopted the findings of Wallaces expert and awarded Wallace and Posada expense and profit adjustments amounting to $26,580.54 and $8,861.38 respectively. Finally, the court awarded Wallace costs in the amount of $24,702.62, the bulk of which were the fees charged by Wallaces accounting expert.



Shaffer did not request a statement of decision under Code of Civil Procedure, section 632. Shaffer filed objections to the proposed judgment submitted by Wallace and Posada but failed to challenge any of the underlying findings of the court or the inclusion in the judgment of the award of Wallace and Posadas costs of suit. Shaffer did timely file a motion to tax those costs, but judgment was entered before the motion could be heard. In the interim Shaffer filed a notice of appeal from the judgment and all orders in support thereof. When the motion to tax costs was finally heard two months later, the trial court declined to entertain the motion on the ground it had been deprived of jurisdiction by the intervening notice of appeal.



CONTENTIONS



Shaffer first contends the evidence was insufficient to support the trial courts finding of fraud because there was no evidence a confidential relationship giving rise to a fiduciary duty existed between the parties; the trial court failed to find Shaffer intentionally concealed or misrepresented any material fact; and Wallace failed to prove he relied on any representation made by Shaffer. He also argues the court erred in allowing Wallace to amend his cross-complaint to conform to proof at trial and awarded inconsistent and unauthorized remedies to Wallace and Posada. Finally, he contends the award of expert costs was improper.



DISCUSSION



1.      The Statutory Scheme Governing Partition



We review Shaffers contentions on appeal in light of the special nature of partition, which, as a statutorily authorized equitable action, confers on the trial court broad discretion to fashion relief without being bound by strict rules of procedure. (Richmond v. Dofflemyer (1980) 105 Cal.App.3d 745, 766; Wallace v. Daley(1990) 220 Cal.App.3d 1028, 1035 [[a]n action for partition is governed by the broad principles of equity jurisprudence, and the courts have adhered, in adjusting the rights of cotenants and defining their interests in the common property, to the classic formulas encapsulated in the maxims that equity is equality and he who seeks equity must do equity, and have dispensed equitable relief only upon condition that the equitable rights of a cotenant are respected and safeguarded.].)Under the statutory scheme the court may hear and determine all motions, reports, and accounts and may make any decrees or orders necessary or incidental to carrying out the purposes of this title and to effectuating its decrees and orders. (Code Civ. Proc., 872.120.)[5] The interests of the parties, plaintiff as well as defendant, may be put in issue, tried, and determined in the action. ( 872.610.) Once the court finds a litigant is entitled to partition, it shall make an interlocutory judgment that determines the interests of the parties in the property and orders the partition of the property and, unless it is to be later determined, the manner of partition. ( 872.720.)In addition, [t]he court may, in all cases, order allowance, accounting, contribution, or other compensatory adjustment among the parties according to the principles of equity. ( 872.140.) Of particular significance in this case, record title of the property is not conclusive; it is merely one item of evidence a court considers in addition to any express agreement of the parties regarding their interests in the property or a different understanding of their interests that the court can infer from the parties conduct. (Kershman v. Kershman (1961) 192 Cal.App.2d 23, 26 (Kershman).)[6]



2.      The Trial Courts Finding of Fraud Is Supported by Substantial Evidence



An appealed judgment or order is presumed to be correct. All intendments and presumptions are indulged to support it on matters as to which the record is silent, and error must be affirmatively shown. . . . (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; see also In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1133.) To overcome this presumption, the appellant must provide an adequate record demonstrating error. (Maria P. v. Riles (1987) 43 Cal.3d 1281, 1295-1296.) A record is inadequate when it appears to show any need for speculation or inference in determining whether error occurred. (Lincoln Fountain Villas Homeowners Assn. v. State Farm Fire & Casualty Ins. Co. (2006) 136 Cal.App.4th 999, 1003-1004, fn. 1, quoting Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (The Rutter Group 2005) 4:43, p. 4-10.1.)



Shaffer frames his appeal of the trial courts finding of fraud as a challenge to three subsidiary findings he claims were necessary to support the trial courts fraud determination: the parties relationship gave rise to a fiduciary duty on the part of Shaffer; Shaffer intentionally concealed or misrepresented a material fact to Wallace or Posada; and Wallace was justified in relying on Shaffers misrepresentation. Shaffers argument founders, however, on his failure to request a statement of decision from the trial court under section 632 or to obtain any clarification of the basis for the trial courts oral statement of its findings.



As recently reviewed at length by our colleagues from Division Three of the Fourth District, a litigant appealing from a bench trial bears the burden of creating an adequate record for appeal by secur[ing] a statement of decision under Code of Civil Procedure section 632 and, pursuant to Code of Civil Procedure section 634, bring[ing] any ambiguities and omissions in the statement of decision to the trial courts attention. (Fladeboe v. American Isuzu Motors, Inc. (2007) 150 Cal.App.4th 42, 58.) Shaffer argues the trial courts statement of findings on the record obviated the need to request a statement of decision under section 632; even were that correct, he has failed to satisfy section 634s corollary requirement that a litigant bring any omission or ambiguity . . . to the attention of the trial court. The clear implication of this provision, of course, is that if a party does not bring such deficiencies to the trial courts attention, that party waives the right to claim on appeal that the statement was deficient in these regards, and hence the appellate court will imply findings to support the judgment. (In re Marriage of Arceneaux, supra, 51 Cal.3d at pp. 1133-1134; see Sammis v. Stafford (1996) 48 Cal.App.4th 1935, 1942 [[The appellant] did not raise any objections to the statement of decision. We therefore are required to presume the trial court made all findings necessary to support the judgment].)



We may thus infer the trial court made all findings necessary to support its conclusion Shaffer acted fraudulently when he induced Wallace and Posada to enter the deal, whether those findings relate to a fiduciary duty owed by Shaffer to his co-owners, to the propriety of Shaffers statements or conduct in the transaction or to Wallaces reliance on any representation made by Shaffer. We then review the implied factual findings under the familiar substantial evidence standard.[7] (Michael U. v. Jamie B. (1985) 39 Cal.3d 787, 792-793; SFPP v. Burlington Northern & Santa Fe Ry. Co. (2004) 121 Cal.App.4th 452, 462; County of Solano v. Vallejo Redevelopment Agency (1999) 75 Cal.App.4th 1262, 1277.)



Substantial evidence supports the trial courts conclusion Shaffer procured his interest in the property through fraud and undue influence. Whether we construe the trial courts finding as one of actual fraud or constructive fraud,[8] Shaffers own testimony is sufficient to support an implied finding of a fiduciary or confidential relationship between the parties. For instance, according to Shaffer, Wallace agreed before entering the deal Wallace would buy three shares of the property assuming nine equal shares of $50,000 each and Shaffer would have the controlling interest and act as managing partner. Shaffer then sold Posada his share at a cost of $50,000, a conversation misconstrued by Posada as 50 shares at $1,000 each. Shaffer also testified the three men agreed to share the costs associated with maintaining the property in accordance with their partnership interests. Crediting this testimony, Shaffer, Wallace and Posada formed a partnership or joint venture; and Shaffer thus owed a fiduciary duty to his partners or joint venturers. (See, e.g., Enea v. Superior Court (2005) 132 Cal.App.4th 1559, 1564 [[I]n all proceedings connected with the conduct of the partnership every partner is bound to act in the highest good faith to his copartner and may not obtain any advantage over him in the partnership affairs by the slightest misrepresentation, concealment, threat or adverse pressure of any kind].)



Similarly, the record amply supports the implied finding Shaffer either misrepresented or concealed his true intentions in his discussions with Wallace preceding the sale. As the trial court stated repeatedly, it found Wallace credible and disbelieved Shaffer. The court therefore accepted Wallaces understanding of the deal and found Wallace had deeded his half-interest in the property to Shaffer fully expecting to receive that half-interest, plus some, in return for his $150,000 note. Nothing more was necessary. We likewise reject Shaffers contention Wallaces admitted failure to read the escrow instructions vitiated his reliance on Shaffer. The instructions did not reveal on their face the anticipated distribution of property interests among Shaffer, Wallace and Posada; and we may infer the court found Wallaces reliance on Shaffer was justifiable.



3.      The Trial Court Did Not Err in Allowing Wallace To Amend His Cross‑complaint To Conform to Proof at Trial



The trial court has broad discretion to grant or deny an amendment to a complaint at trial, and Californiacourts have been extremely liberal in allowing such amendments to conform to proof. (Glaser v. Meyers (1982) 137 Cal.App.3d 770, 776-777; see  473, subd. (a)(1), 576.) In general, the trial courts discretion is restricted only when the opposing party demonstrates inexcusable neglect by the party seeking the amendment or probable prejudice as a result of allowing it. (Magpali v. Farmers Group, Inc. (1996) 48 Cal.App.4th 471, 487; In re Jessica C. (2001) 93 Cal.App.4th 1027, 1042 [[t]he basic rule from civil law . . . is that amendments to conform to proof are favored, and should not be denied unless the pleading as drafted prior to the proposed amendment would have misled the adversarial party to its prejudice]; Record v. Reason (1999) 73 Cal.App.4th 472, 486 [trial courts ruling on motion for leave to amend to conform to proof will not be reversed absent a showing of a manifest or gross abuse of discretion].)



Shaffer asserts he was prejudiced by Wallaces amendment because, lacking notice of any claim of fraud, he failed to depose several witnesses whose testimony might have disproved the allegation and also lost his opportunity to demand a jury trial on the fraud claim. This argument ignores the special nature of a partition action, which, as discussed, is governed by principles of equity. Wallaces oral motion to amend the cross-complaint to conform to proof did not seek any additional remedies related to a legal cause of action; to the contrary, Wallace argued simply the evidence at trial established Shaffer had obtained the property through undue influence. Shaffers own complaint had already placed the equitable ownership of the property at issue.[9] (See  872.120.) As the trial court was already empowered to realign the respective interests of the parties in accordance with equitable principles, it matters little whether the court granted Wallaces request to amend the cross-complaint. There was no prejudice to Shaffer from the courts order granting the amendment and thus no abuse of its discretion.



4.      The Remedies Imposed by the Trial Court Were Authorized Under the Statutory Scheme for Partition



Shaffer nextcontends the trial courts imposition of a resulting trust on the property was not authorized by law, arguing that, when a party has been induced to enter into a contract by the defendants fraud, the party has a choice of affirming the contract and suing for damages for deceit or rescinding the contract and seeking restitution. (See Civ. Code, 1692; Star Pacific Investments, Inc. v. Oro Hills Ranch, Inc. (1981) 121 Cal.App.3d 447, 461 [[i]t is well established that where the plaintiff contracts in reliance upon the fraud of the defendant, he may elect either the contract remedy, consisting of restitution based on rescission or the tort remedy, by affirming the contract and seeking damages].)



Shaffers argument is premised on a distinction without a difference. Whether the remedy imposed by the trial court in this case is characterized as a resulting trust,[10]a constructive trust,[11]or simply an order of partition, the court acted well within its inherent equitable powers to realign the parties respective interests in the property. (See, e.g., Kershman, supra,192 Cal.App.2d at p. 26 [in action for partition court can infer ownership interests of parties through extrinsic evidentiary conduct in addition to parties express agreement record title of the property is merely one item of evidence a court considers in addition to any express agreement of the parties regarding their interests in the property or a different understanding of their interests that the court can infer from the parties conduct].)[12]



5.      The Trial Court Failed To Exercise Its Discretion in Awarding Expert Costs to Wallace



Shaffer last contendsthe trial court erred in awarding to Wallace, as part of the final judgment, $18,000 in expert fees. Wallace argues these fees were properly awarded because Shaffers expert declined to confer with his expert to produce a joint report as directed by the court. The court then adopted the conclusions proffered by Wallaces expert in ruling on the accounting claims raised by the parties.



Section 874.040 provides, Except as otherwise provided in this article, the court shall apportion the costs of partition among the parties in proportion to their interests or make such other apportionment as may be equitable. The costs of partition include disbursements or expenses determined by the court to have been incurred or paid for the common benefit. ( 874.010, subd. (e), italics added.) These sections lead[] to the conclusion that costs should be awarded in proportion to the litigants interest in the property. (Stutz v. Davis (1981) 122 Cal.App.3d 1, 4 (Stutz).) [T]he purpose of the statute is to divide the cost of the legal services among the parties benefited by the result of the proceeding. (Ibid.)



We review an award of fees in a partition action for abuse of discretion. (Finneyv.Gomez (2003) 111 Cal.App.4th 527, 545 (Finney).) If the trial court has made no findings, the reviewing court will infer all findings necessary to support the judgment and then examine the record to see if the findings are based on substantial evidence. (Ibid.)



While the court may wellhave acted for the reasons suggested by Wallace, there is nothing in the record indicating the court made the required determination under section 874.010, subdivision (e), as to which of the experts costs were actually incurred for the common benefit. In reviewing an award of attorney fees rendered under these provisions, the Stutz court observed, While we recognize that the applicable statutes allow the trial court to apportion fees and costs in an equitable manner, there is nothing in the record before us to support an apportionment in any manner other than according to the respective interest of the parties in the property. (Stutz, supra, 122 Cal.App.3d at p. 5.) The Finney court followed suit: [I]n the absence of any substantial evidence to support an equitable apportionment the award of costs must be reversed. (Finney, supra, 111 Cal.App.4th at p. 547.) The trial courts evident failure to exercise the discretion conferred by the statute to apportion costs and the lack of any evidence to support the cost award thus require us to reverse the award and remand the case for the limited purpose of properly apportioning the expert accounting fees incurred by Wallace in this proceeding.



DISPOSITION



The judgment is reversedto the extent it fails to apportion expert witness fees, and the cause is remanded for further proceedings not inconsistent with this opinion. In all other respects the judgment is affirmed. Each party is to bear his own costs on appeal.



NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS







PERLUSS, P. J.







We concur:







JOHNSON, J.









WOODS, J.







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Analysis and review provided by Oceanside Property line Lawyers.









[1] The Foothill property is now owned by another of Wallaces nephews and is not at issue in this litigation. Darrons interest in the Osborne property was held variously by Darron alone, in conjunction with his wife Sylvia, or by the couple together. For convenience, we refer to the interest as belonging to Darron.



[2] Shaffer signed escrow instructions in December 2002 contemplating his purchase of the entire property but the instructions on their face were not inconsistent with Wallaces expectations.



[3] When Shaffer accepted Posadas certified check for $50,000 just days before escrow closed, he told Posada he would receive shares in the property, which Posada understood to mean 50 shares valued at $1,000 each.



[4] Wallace testified he understood the note represented the value of his equity interest (approximately $115,000) plus his payment for a third of Darrons equity. Like much of the testimony, the logic of this understanding cannot be deduced from the record before us.



[5] Statutory references are to the Code of Civil Procedure unless otherwise indicated.



[6]The Legislature substantially reorganized the statutes governing partition in 1976, but its intent was to reflect current law except where expressly noted otherwise. Accordingly, pre-1976 authority retains its vitality.(Richmond v. Dofflemyer, supra,105 Cal.App.3d at p. 753.)



[7] In resolving challenges to a judgment based on sufficiency of the evidence, we review the record as a whole, resolving all conflicts and indulging all legitimate and reasonable inferences in favor of the prevailing party, to determine whether substantial evidence supports the judgment. (Western States Petroleum Assn. v. Superior Court (1995) 9 Cal.4th 559, 571.) Substantial evidence in this regard does not mean any evidence. Rather, to be substantial, the evidence must be of ponderable legal significance, . . . reasonable in nature, credible, and of solid value. (Bowers v. Bernards (1984) 150 Cal.App.3d 870, 873, italics omitted.) If there is substantial evidence, contradicted or uncontradicted, that will support the finding, it must be upheld regardless of whether the evidence is subject to more than one interpretation. (Western States Petroleum Assn., at p. 571 [[w]hen two or more inferences can be reasonably deduced from the facts, the reviewing court is without power to substitute its deductions for those of the trial court]; Von Beltz v. Stuntman, Inc. (1989) 207 Cal.App.3d 1467, 1481 [reviewing court may not reweigh the evidence].) [T]he testimony of a single witness, even [a] party . . . , may be sufficient. (Jensen v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112, 134.)



[8] As Wallace points out, the trial courts comments suggest it concluded Shaffers conduct constituted actual fraud, a finding that does not require proof of an underlying fiduciary duty or confidential relationship. The difference between actual fraud and constructive fraud is primarily the type of conduct which may be treated as fraudulent, such as a failure to disclose material facts within the knowledge of the fiduciary. (Estate of Gump (1991) 1 Cal.App.4th 582, 601.) While aclaim for fraud must be premised onan intentional misrepresentation or omission of material fact (see Charnay v. Cobert (2006) 145 Cal.App.4th 170, 184), a constructive fraud claim allows relief for negligent omissions constituting breach of duty in a confidential relationship. (Tyler v. Childrens Home Society (1994) 29 Cal.App.4th 511, 548.) A confidential relation exists between two persons when one has gained the confidence of the other and purports to act or advise with the others interest in mind. A confidential relation may exist although there is no fiduciary relation . . . . (Id. at p. 549.) In its generic sense, constructive fraud comprises all acts, omissions and concealments involving a breach of legal or equitable duty, trust or confidence, and . . . exists in cases in which conduct, although not actually fraudulent, ought to be so treated -- that is, in which such conduct is a constructive or quasi fraud, having all the actual consequences and all the legal effects of actual fraud. (Estate of Gump, at p. 601.)



[9] Shaffers complaintprayed for, in part, [a]n Order for partition by sale [of] any interests in the Property according to the respective rights of the parties. (See  872.610 [[t]he interests of the parties, plaintiff as well as defendant, may be put in issue, tried, and determined in the action].) Likewise, Shaffer sought [a]n Order for an accounting by all Tenants in Common of all rents and profits derived from the Property. Accordingly, Shaffers complaint itself authorized the remedies imposed by the court.



[10]A resulting trust arises from a transfer of property under circumstances showing that the transferee was not intended to take the beneficial interest. [Citation.] [] It has been termed an intention-enforcing trust, to distinguish it from the other type ofimplied trust, the constructive or fraud-rectifying trust. The resulting trust carries out the inferred intent of the parties; the constructive trust defeats or prevents the wrongful act of one of them. (American Motorists Ins. Co. v. Cowan (1982) 127 Cal.App.3d 875, 884-885; see also Calistoga Civic Club v. City of Calistoga (1983) 143 Cal.App.3d 111, 117-118 [[l]ike a constructive trust, the resulting trust is a creature of equity and need not be evidenced by writing or even by an express declaration].)



[11] A constructive trust is a remedial device primarily created to prevent unjust enrichment; equity compels the restoration to another of property to which the holder thereof is not justly entitled . . . . (Martin v. Kehl (1983) 145 Cal.App.3d 228, 237.) [A] constructive trust may be imposed in practically any situation where there is a wrongful acquisition or detention of property to which another is entitled. (Nelson v. Nevel (1984) 154 Cal.App.3d 132, 139.)



[12] Shaffer requests we take judicial notice of a quit-claim deed transferring the entire property from Darrons wife Sylvia to Wallace as proof Wallace understood no later than mid-December 2002 the sale was structured to transfer the entire property to Shaffer, not just half of the property. Having received no objection to the request for judicial notice, it is granted, although, in light of the principle articulated in Kershman, supra, 192 Cal.App.2d 23, we do not find it dispositive.





Description Gene Shaffer appeals from the judgment entered against him on his complaint for partition and an accounting against Otis Wallace and Gonzalo Posada and in favor of Wallace on Wallaces cross-complaint for partition and damages. Shaffer contends the trial courts equitable rulings on the partition and accounting causes of action were premised on a finding of fraud for which there was insufficient evidence. He also argues the court erred in allowing Wallace to amend his cross complaint to conform to proof at trial and awarded inconsistent and unauthorized remedies to Wallace and Posada. Finally, he contends the award of expert costs was improper. With the exception of the award of costs, Court affirm.
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