Wilson v. J.G. Bailey Corp.

Filed 5/11/07 Wilson v. J.G. Bailey Corp. CA5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FIFTH APPELLATE DISTRICT

APPEAL from a judgment of the Superior Court of Kern County. Arthur E. Wallace, Judge.

Indra L. Lahiri and Frederick C. Kumpel for Plaintiff and Appellant.

Gilmore, Wood, Vinnard & Magness, William H. Leifer and Gerald D. Vinnard for Defendants and Respondents.

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Appellant, Mark Wilson, doing business as Marks Express Lube, filed an action against his landlord, respondents, J.G. Bailey Corporation and James G. Bailey, Sr., alleging that respondents were estopped from refusing to renew Wilsons lease. Following a bench trial, the court ruled in respondents favor. The court found that Wilson had failed to establish, by a preponderance of the evidence, both that respondents made a clear, unambiguous and unconditional promise to renew Wilsons lease and that Wilson reasonably and foreseeably relied on this promise to his detriment.

Wilson contends the evidence is insufficient to support the trial courts decision. Wilson argues that he reasonably relied on respondents promise that it would be business as usual with respect to renewing the lease and suffered detriment in that he did not begin the process of moving his business to a new location. Accordingly, Wilson asserts, the trial court should have applied promissory estoppel.

As discussed below, the trial courts findings are supported by the record. Thus, the judgment will be affirmed.

BACKGROUND

Wilson operated his business in an oil change facility that he sublet from respondents. This sublease was to terminate on December 15, 2003.

In April or May 2003, Wilson telephoned one of the corporations principals, James G. Bailey, Jr., to inquire about renewing the lease. Wilson testified he explained to Bailey that he needed to know whether he was going to get a new lease before signing his own contract with Chevron-Texaco. According to Wilson, Bailey told him that it would be business as usual. However, Bailey testified his response was that it was too early to negotiate the lease.

Shortly thereafter, Wilson listed his business for sale. Wilson received an offer for $70,000. This sale was contingent on the renewal of the lease between Wilson and respondents.

Wilson also signed a new contract with Chevron-Texaco. As part of the deal, Wilson received a $15,000 loan that he could use for any purpose.

In October, Wilson requested a letter from Bailey regarding respondents intent to renew the lease. In response, by letter dated October 21, 2003, Bailey wrote:

As you requested this letter represents our interest to renew our lease with you at the oil change facility on the corner of California Avenue and Real Road. We anticipate renewing the Texaco lease in the next month or so. When that lease is renewed we will renew your lease for the same term.

In November, respondents learned that the Texaco franchisee was going to leave. No other tenant could be found. Thus, the adjoining gasoline station closed. Due to the uncertain future of the property, Bailey notified Wilson in January 2004 that he could operate his business free of rent until further notice.

By letter dated April 5, 2004, Wilson was informed that respondents had not found a tenant to occupy the service station next to the lube room. Respondents had therefore decided to demolish the buildings and redevelop the property. Accordingly, Wilson was given 30 days to vacate the premises.

Wilson filed a complaint against respondents based on an alleged breach of the promise to renew as stated in the October 21, 2003, letter. The case went to trial before the court on a single cause of action for promissory estoppel.

The court found that Wilson had failed to establish by a preponderance of the evidence that respondents made a clear, unambiguous and unconditional promise to Wilson to renew his lease. The court further determined that Wilson did not detrimentally change his position in reliance on anything Bailey said. Wilsons putting his business up for sale and signing a new agreement with Chevron-Texaco did not result in a detriment. Moreover, these acts were not reasonably foreseeable when Bailey made the business as usual statement in early 2003. Finally, Wilson did not prove that he actually relied on any statement made by Bailey in May as evidenced by his request for something in writing in October. Accordingly, judgment was entered in respondents favor.

DISCUSSION

Wilson contends that the record supports a determination in his favor on the promissory estoppel claim. According to Wilson, he reasonably and foreseeably relied on Baileys promise regarding his lease that it would be business as usual and, based on that promise, forbore from taking steps to relocate his business. Wilson argues that this is the only conclusion supported by the evidence and that the trial courts contrary conclusions demonstrate an incomplete and erroneous analysis.

Promissory estoppel applies whenever a promise which the promissor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance would result in an injustice if the promise were not enforced. (Lange v. TIG Ins. Co. (1998) 68 Cal.App.4th 1179, 1185.) However, to be binding, the promise must be clear and unambiguous in its terms. (Laks v. Coast Fed. Sav. & Loan Assn. (1976) 60 Cal.App.3d 885, 890.) Further, the party to whom the promise is made must rely on the promise and that reliance must be both reasonable and foreseeable. Finally, the party asserting the estoppel must be injured by his or her reliance. (Ibid.)

Whether an estoppel exists is a question of fact unless only one inference can be drawn from the evidence. (Henry v. Weinman (1958) 157 Cal.App.2d 360, 366.) Where, as here, the appellant attacks the trial courts factual findings on the ground that they lack evidentiary support, the reviewing courts power begins and ends with the determination of whether there is any substantial evidence to sustain the challenged findings. (Ibid.)

Wilson contends that the facts and the inferences support only one conclusion, i.e., that Wilson foreseeably relied on Baileys promise that it would be business as usual to his detriment. However, contrary to Wilsons position, the trial courts opposite findings are supported by substantial evidence.

Wilson contends that Baileys statement in May 2003 that it would be business as usual was a promise that respondents should have reasonably expected Wilson to rely on. According to Wilson, business as usual can only mean that Wilson would continue his lube business at the same site. However, it can also be inferred from this statement that Wilson would so continue only if the gas station also continued its business at the adjoining site. That would be business as usual for the parcel in question. This interpretation is supported by Wilsons own testimony that Bailey told him his lease would run concurrent with Chevron or Shell or Texaco or whoever went in that location. Thus, the trial courts finding that Wilson did not establish a clear, unambiguous and unconditional promise is supported by substantial evidence.

Wilson further argues that the trial court simply ignored the forbearance prong of the promissory estoppel analysis. According to Wilson, he did not take action to move his business, i.e., he forbore based on Baileys promise, and this inaction should reasonably have been expected. Wilson asserts that because forbearance, a form of detrimental reliance, was established, the trial courts decision should be reversed.

However, the evidence does not conclusively establish that appellant relied on Baileys business as usual comment. As noted by the trial court, the fact that Wilson requested a letter in October regarding the lease renewal supports the finding that Wilson did not rely on Baileys comment. Wilsons acts of putting his business up for sale and accepting an unconditional $15,000 loan are not necessarily inconsistent with this conclusion. Moreover, the requested letter clearly established that the renewal of Wilsons lease was conditioned on Texacos renewal of its lease. Thus, the trial courts finding that Wilson failed to establish actual reliance is supported by the record.

Further, there is no evidence to support Wilsons claim that respondents should have expected Wilson to rely on Baileys business as usual statement. Rather, Bailey told Wilson at the time that it was too early to negotiate a lease.

In sum, the trial courts conclusion that Wilson failed to establish the elements of a promissory estoppel cause of action is supported by substantial evidence. Accordingly, the judgment will be affirmed.

DISPOSITION

The judgment is affirmed. Costs on appeal are awarded to respondents.

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HILL, J.

WE CONCUR:

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HARRIS, Acting P.J.

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GOMES, J.

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