Carranza v. Voqui

Filed 7/3/07 Carranza v. Voqui CA3

NOT TO BE PUBLISHED

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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

THIRD APPELLATE DISTRICT

(Sacramento)

----

In 2001, the plaintiffs, as buyers, and the defendants, as sellers, entered into an agreement for the sale of real property in Sacramento. No deed was ever provided and, eventually, the defendants asked the plaintiffs to move out so they could sell the property to someone else. The plaintiffs sued, claiming the defendants breached the contract by failing to finish the paperwork on the sale. The defendants countered that the agreement was just a lease with an option to buy the property and that the plaintiffs had failed to exercise the option. The trial court found in favor of the plaintiffs, and the defendants appeal.

On appeal, the defendants contend the evidence and law do not support the judgment. We affirm.

FACTS

As discussed below, the defendants did not request a statement of decision and judgment was entered in the plaintiffs favor. Therefore, we recount the facts, construing the evidence in the light most favorable to the judgment. (Escamilla v. California Dept. of Corrections & Rehabilitation (2006) 141 Cal.App.4th 498, 514.)

Plaintiff Santos Carranza does not read or write English. He and his wife, plaintiff Francisca Silva, testified through an interpreter. Defendant Han Voqui buys, sells, and leases property in the Sacramento area. Defendant Thuy Voqui is Han Voquis wife.

In 2001, defendant Han Voqui (hereafter Voqui) told Carranza, who was renting a different house from Voqui, that he was trying to sell a house at 2531 65th Avenue in Sacramento. Carranza told Voqui he did not have enough money to buy a house, nor did he have a social security card or available credit. In March 2001, Carranza and Voqui agreed Carranza would purchase the 65th Avenue property by giving Voqui $10,000 down and paying $860 ($750 for the payment and $110 for taxes) per month for 15 years. Carranza gave Voqui $5,300 in cash. He had also done automobile work for Voqui worth $1,800. Carranza understood he would need to pay the remaining $2,900 when they went to sign all the papers.

Voqui wrote and signed a document titled Invoice. The text of the document was as follows:

Sold 2531 65th AVE

AS IS CONDITION FOR

$69,000

(Sixty nine thousand and 00/00)

Escrow will be closed on

12/1/2001

Deposit $5300 (Fifty three hundred)

[Voquis signature]

monthly payment $750 --

tax monthly 110.38

On the same day (in March 2001), Voqui presented Carranza with a printed-form document entitled LEASE WITH PURCHASE OPTION. It stated that the parties agreed Carranza and Silva would lease the property for $860 per month, with a security deposit of $5,300. The document stated Carranza and Silva had the option to purchase the property for $69,000, with a down payment of $6,000 payable on the exercise of the option. The document required Carranza and Silva to exercise the option no later than March 31, 2002, one year after the beginning of the lease. Voqui, Carranza, and Silva signed this document.

Voqui had been unable to evict the tenants living at 2531 65th Avenue, so he told Carranza, who knew the tenants, that Carranza would have to tell them to leave.

Carranza understood that he had purchased the property. Before moving in, he performed repairs on the house. Voqui knew Carranza was repairing the house. Carranza fixed holes in the walls, put in new windows and doors, painted the inside of the house, and cleaned the carpets. He also did repairs and landscaping outside.

From the time Carranza took possession of the house, Voqui knew Carranza could not obtain financing. At the time, Carranza was in the United States illegally and Silva was on welfare. Voqui said he would finance the purchase of the house. The parties never completed any more paperwork. And no deed was ever provided. At the end of the first year after the transaction, Voqui told Carranza he was only going to charge them $750 per month because he was a nice guy.

After Carranza and Silva had been living in the house for more than one year, Voqui asked them to move out. Carranza and Silva were current in their payments at that time. They requested Voqui to complete the paperwork, and he refused.

PROCEDURE

The plaintiffs filed suit against the defendants. They asserted causes of action for breach of contract, breach of the implied covenant of good faith and fair dealing, quiet title, and fraud. After a court trial, the court entered judgment in favor of the plaintiffs as follows: The Court finds that . . . the Invoice, which purports to sell the real property located at 2531 65th Avenue, . . . prepared and signed by the defendant Han Voqui as seller, in an as is condition for the price of $69,000 to the plaintiffs, Santos Carranza and Francisca Silva, and which sets forth the terms of the sale, is a contract for the purchase and sale of the subject real property, which upon full payment of the purchase price according to its [sic] terms shall entitle plaintiffs to a deed to said real property from defendants to said plaintiffs. []  The plaintiffs shall be given full credit for all payments made to the defendant pursuant to the terms of this agreement. Neither party requested a statement of decision. (Code Civ. Proc.,  632, 634.)

STANDARD OF REVIEW

A contract must be so interpreted as to give effect to the mutual intention of the parties as it existed at the time of contracting, so far as the same is ascertainable and lawful. (Civ. Code, 1636.) A contract may be explained by reference to the circumstances under which it was made, and the matter to which it relates. (Civ. Code, 1647.)

Interpretation of a written document where extrinsic evidence is unnecessary is a question of law for the trial court to determine. [Citation.] When the meaning of contractual language is doubtful or uncertain and parol evidence is introduced to aid in its interpretation, the meaning of the contract is a question of fact. [Citation.]. (Horsemen's Benevolent & Protective Assn. v. Valley Racing Assn. (1992) 4 Cal.App.4th 1538, 1559.)

When parol evidence is introduced in aid of the interpretation of uncertain or doubtful language in the contract, the question of the meaning or intent of the parties is one of fact. If the meaning or intent is to be determined one way according to one view of the facts and another way according to another view, the determination of the disputed matter must be left to the [trier of fact]. [Citation.] (Horsemen's Benevolent & Protective Assn. v. Valley Racing Assn., supra, 4 Cal.App.4th at p. 1560.)

By failing to request a statement of decision, Voqui has forfeited the right to complain about the absence of any finding or legal conclusion by the trial court. (In re Randi D. (1989) 209 Cal.App.3d 624, 631.) On review, we presume the judgment is correct and indulge all intendments and presumptions in favor of the judgment.^[1] (In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1132-1134 [applying Code Civ. Proc.,  632, 634].)

DISCUSSION

I

Contract Interpretation

Although couched in various terms, the defendants main argument is that the trial court erred in interpreting the two documents presented as evidence -- the Invoice and the Lease with Purchase Option. They assert that it was error to go beyond the face of these documents to extrinsic evidence to determine the meaning of the documents. They argue that the trial court should have determined that the Lease with Purchase Option was the enforceable document and, further, should have concluded that the plaintiffs simply failed to exercise the option. To the contrary, the evidence supports the judgment.

Serially, the defendants claim the trial court committed several errors in reasoning, such as ignoring language in the pertinent documents, considering extrinsic evidence, failing to give effect to every part of each document, failing to interpret properly the terms of the documents, reforming the Invoice, and failing to give the Invoice a reasonable construction. In making these assertions, the defendants make several assumptions concerning the factual findings and legal conclusions adopted by the court. For example, they state the trial court ignored the clear and explicit written language of the invoice, us[ed] the plaintiffs [sic] subjective trial testimony to ignore the agreements [sic] written terms, and focus[ed] on some isolated portions of the contract and ignore[ed] [others]. Having failed to request a statement of decision, however, the defendants cannot make assumptions concerning factual findings and legal conclusions. (In re Marriage of Ditto (1988) 206 Cal.App.3d 643, 647.) Therefore, the defendants arguments must be construed solely as an argument that the evidence was insufficient to sustain the judgment, without regard to what analysis the trial court applied.

Even assuming the parties executed the two documents, the Invoice and the Lease with Purchase Option, on the same day and as part of the same transaction, the trial court could have reasonably found that the two documents were irreconcilable. A contract must be so interpreted as to give effect to the mutual intention of the parties as it existed at the time of contracting, so far as the same is ascertainable and lawful. (Civ. Code,  1636.) While the documents must be interpreted together (Civ. Code,  1642) and effect must be given to each provision, if reasonably practicable (Civ. Code,  1641), the court must resort to extrinsic evidence if the various parts of the contract cannot be reconciled (Code Civ. Proc.,  1856, subd. (g)).

On its face, the Invoice states it is a sale of the real property. On the other hand, the Lease with Purchase Option purports to be a lease. Therefore, the court was required to determine which type of transaction the parties intended. Also, because Voqui drafted the agreements, causing the uncertainty, the language of a contract should be interpreted most strongly against the party who caused the uncertainty to exist. (Civ. Code,  1654.) As recounted above, there was evidence that the parties agreed on a sale of the property, not a lease, and that they put that agreement in writing subject to the terms found in the Invoice. Accordingly, the evidence supports the trial courts judgment. The documents were irreconcilable, so the court considered extrinsic evidence and concluded that the parties intended a sale of the property.

The defendants fail to recognize that the evidence, construed properly, supports the judgment. Instead, they make seven arguments challenging the validity of the judgment, none of which has merit.

1. The defendants contend the Invoice was merely a deposit receipt. To the contrary, in addition to an acknowledgement that the plaintiffs had given the defendants $5,300, the Invoice also stated the terms of the sale, including the price, the as is nature of the sale, a closing date for escrow, and a monthly payment.

The existence of the Lease with Purchase Option does not prevent the trial courts treatment of the Invoice as a contract for sale. Since a sale and a lease of the property are incompatible, the trial court was required to determine, from the evidence, whether the parties intended a sale or a lease. Once the court found the parties intended a sale, it properly ignored the lease provisions and enforced the sale provisions.

2. The defendants argue that the trial court ignored the escrow closing date in the Invoice. They claim the trial court did not give effect to that term and therefore erred. The plaintiffs testified that they urged Voqui to set a date to sign the papers; therefore, the trial court could have concluded that the title had not been transferred only because Voqui delayed.^[2] In making their argument, the defendants fail to present legal reasoning and citations to authority concerning the effect of the parties failure to close escrow on the date stated in the Invoice -- 12/1/2001. (See Mansell v. Board of Administration, supra, 30 Cal.App.4th at pp. 545-546 [arguments without legal reasoning and citation to authority forfeited].)

3. The defendants contend the trial court erred by reforming the contract. In making this argument, the defendants assert: The trial courts interpretation is absolutely repugnant to the written terms of the agreements and must be disregarded. The invoice and the lease with purchase option are not in any respect ambiguous or uncertain.

We need not review the law concerning reformation of contracts because, as seen by the defendants argument, they assert error in the interpretation of the contract. The trial court did not reform the contract.

The gist of the defendants reformation argument is that the courts judgment results in seller financing of the property for the past seven and one-half years. While this is true, it is not contrary to the parties contract which provided for payments from the plaintiffs to the defendants. The fact that the parties did not close escrow does not make the trial courts interpretation contrary to the parties intent. The contract did not define whether the plaintiffs were required to acquire outside financing; therefore, seller financing, consistent with the payment schedule agreed upon by the parties, is supported by the evidence.

4. The defendants claim the judgment is unreasonable because it is unusual, extraordinary, harsh, unjust and inequitable to defendants and resulted in an absurdity. The trial courts reformation and interpretation of the deposit receipt invoice, continue the defendants, is an unfair and unreasonable [sic] and leads to harsh and unreasonable result [sic] of taking defendants [sic] equity, forcing defendants to seller finance the property to plaintiffs, and forcing defendants to continue to pay the mortgage, mortgage insurance, property taxes, property and casualty insurance and utilities on the property. Each of these reasons the defendants posit for calling the judgment unreasonable is either or both irrelevant or without merit. The judgment does not take away equity from the defendants; instead, it concludes that the defendants sold the property in 2001 and, therefore, no longer had equity from that time. Seller financing was a reasonable interpretation of the contract, along with the evidence that Voqui told the plaintiffs he would finance the purchase under the terms written in the Invoice. Finally, that Voqui still pays the property taxes and the utilities on the property is a symptom of the informality with which the transaction was made but does not invalidate the transaction. The defendants cite no authority for the proposition that their continued payment of taxes voided the sale. The defendants also give no citation to the evidence for the proposition that they were required to pay the mortgage, as well as for mortgage insurance and property and casualty insurance on the property.

5. The defendants claim that the December 1, 2001, closing of escrow was a condition precedent and, therefore, since escrow did not close, the sale never happened. They argue: Defendant[s] did not make an absolute or unconditional promise to transfer title to plaintiffs; but defendant made a conditional promise and bound himself to transfer tile [sic] only if the condition precedent (closing on December 1, 2001 or March 31, 2002 [as stated in the Lease with Purchase Option] occurs. In this instance, the defendants attempt simply to create a condition not found in the sale document. In any event, even if the closing of escrow, which the record reflects was never even opened, was a condition precedent to transfer of title, that does not change the terms of the sale.

6. The defendants contend the trial court erred by ignoring the time for performance. We need not consider this issue beyond noting that the evidence, considered in the light most favorable to the judgment, shows the plaintiffs tried to get Voqui to set up a time to sign papers and transfer title, but Voqui refused.

7. Finally, the defendants assert the plaintiffs failed to exercise the option to purchase the property. The court, however, ruled that, pursuant to the Invoice, the parties agreed to the sale. Therefore, there was no need for the exercise of an option.

II

Judgment Against Thuy Voqui

The defendants contend that neither the Invoice nor the Lease with Purchase Option can be enforced against Thuy Voqui because she did not sign them. This is an issue the defendants did not raise at trial. They made no attempt to establish that Han Voqui did not have authority to act for Thuy Voqui, as a co-owner of the property, in the sale of the property. The defendants made no effort to raise this issue in the trial court, either by affirmative defense or by way of evidence and argument at trial. They also failed to request a statement of decision concerning this issue. By failing to raise the issue in the trial court, the defendants have forfeited consideration of the issue on appeal. (Karlsson v. Ford Motor Co. (2006) 140 Cal.App.4th 1202, 1236.) In any event, there was no evidence presented that Voqui, as a co-owner of the property, did not have full authority to sell it.

DISPOSITION

The judgment is affirmed.

NICHOLSON , J.

We concur:

BLEASE , Acting P.J.

BUTZ , J.

Publication Courtesy of California lawyer directory.

Analysis and review provided by Escondido Property line attorney.

^[1] The defendants make several offhanded assertions of error without citation to authority. For example, in the section of the opening brief recounting the trial court proceedings, the defendants state: A bench trial was held on this matter and the trial court misconstrued the case as an unlawful detainer action. [Record citation.] Further, the court erred by leading plaintiffs [sic] testimony on several occasions to point [sic] plaintiffs change [sic] their testimony based upon the court testifying. [Record citations.] The courts bias and leading testimony [sic] should be a reversible error. We will not consider arguments made without legal reasoning and citation to authority. (Mansell v. Board of Administration (1994) 30 Cal.App.4th 539, 545-546.)

^[2] The defendants claim the plaintiffs did not diligently pursue their escrow closing obligations on the invoice and requested an extension. [Voqui] gave plaintiffs an extension by executing a more formal standard for lease option to purchase agreement. [Record citations.] There are several problems with this argument. First, it construes the evidence in the light favorable to the defendants, not the judgment. Second, it assumes that the Lease with Purchase Option was executed after the Invoice, although, under a proper interpretation of the evidence, it appears the two documents were executed at the same time. And third, the defendants fail to explain the legal effect of extending the time to close escrow.