GREENWICH v.WONG Part-II
The primary questions presented in this case are whether lost profits may be awarded as consequential damages under Civil Code section 3306 for breach of a real property sale agreement where the buyer intended to renovate and sell the property at a profit and, if so, whether lost profits were properly awarded here.[1] We shall conclude that although lost profits may be available in an appropriate case, lost profits were not properly awarded here, where the evidence showed the prospect of profits was uncertain, hypothetical and entirely speculative.
Defendant Donna Wong appeals from a judgment of the San Francisco Superior Court on a jury verdict awarding plaintiff and respondent Greenwich S.F., LLC (Greenwich S.F.) $600,000 in lost profits, among other damages, on appellant's breach of a real property sales agreement between appellant and plaintiff Yui Hei Chan, Greenwich S.F.'s predecessor in interest.[2] Appellant contends the trial court applied an erroneous measure of damages by allowing recovery of lost profits as consequential damages under section 3306. She also contends the court erred (1) in admitting expert testimony as to the hypothetical value of the property if it had been renovated according to plaintiffs' plans; (2) in allowing the expert to testify as to new opinions regarding valuation dates to which the expert did not testify during her deposition; and (3) in instructing the jury that it could award lost profits. If lost profits may be recovered in an appropriate case, appellant contends the evidence was insufficient to support the award in this case as (4) lost profits were not proved with reasonable certainty and the prospect of profits after renovation was hypothetical and speculative, and (5) there was insufficient evidence to support a finding that appellant knew plaintiffs intended to sell the property for a profit. Appellant also challenges (6) the award of $60,000 damages for sums plaintiffs had deposited into escrow, and (7) the award of $90,000 damages for funds plaintiffs expended toward the planned property renovation. Finally, should she prevail on appeal, appellant seeks reversal of the attorney fee award.
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