Filed 2/1/23 Yoon v. Kim CA2/2

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

DON YOON et al.

,

Plaintiff s and Appellant s ,

v.

SUNNY MISUN KIM et al.

,

Defendant s and Respondent s

. B 312654

(Los Angeles County Super. Ct. No. BC585932 )

APPEAL from a judgment of the Superior Court of Los Angeles County, Steven J. Kleifield , Judge. Affirmed

.

Frederick W. Lee Law Firm and Sam M. Muriella for Plaintiffs and Appellants.

David S. Kim & Associates, David S. Kim and Todd A. Fuson for Defendants and Respondents.2 Don Yoon (Yoon) and Eunice Yoon (appellants) appeal from a judgment entered after a be nch trial on appellants’ claims against Young Ja Choi (Choi), LA1 Realty and Sunny Misun Kim (Kim) 1 arising out of appellants’ purchase of commercial real property. Appellants argue that the trial court improperly calculated damages against Choi and that the trial court erroneously denied their motion to conform to proof to add a
cause of action for co nstructive fraud against respondents. We affirm the judgment.

BACKGROUND The following background facts is taken from the trial
court’s written statement of decision in this matter. Appellants purchased commercial real property in Mojave, California from Choi for $3.6 million. The property consisted of four buildings and 13 rental units. Choi and her husband decided to sell the property and hired Kim, a licensed real estate
broker a t LA1 Realty, to assist with the sale.
After post ing a brochure online , Kim was contacted by Yoon, who expressed an interest in buying the property. Yoon, who resides in San Jose, California was not assisted by a real
estate broker and made an offer to b uy the property without a personal viewing . After some negotiation, the parties agreed on the $3.6 million purchase price and signed a purchase agreement in July 2014.

1 Because Choi has not filed a brief in this appeal, LA1 Realty and Kim are collectively referred to as “respondents” in this opinion.3 Kim , who acted in the capacity of a dual agent with respect
to this transaction

, had t he parties sign a dual agent disclosure form, in which they acknowledged being informed of the dual agency and the rights and obligations inherent thereto. Initially, Choi’s husband, Hwa Scob Choi, had the primary role with respect to the transaction. He died suddenly, and
thereafter Choi’s son , Byoung Kuk Choi

, assist ed in the sale. 2 During the escrow period, pursuant to the purchase agreement, various documents were produced to Yoon, including a rent roll on Kim’s stationary, estoppel certificates, co pies of leases, and receipts that were allegedly for cash payments of rent. Kim provided Yoon with the rent roll and understood the information would be significant to him and that it was important that this documentation be accurate. The rent roll

conta ined the following disclaimer: “Information deemed reliable

, but not guaranteed.” Kim also prepared a document entitled “Income & Expense, as of July 2014.” Like the rent roll, the income and expense document specifically stated, “Information
deemed reli able but not guaranteed.” This document was prepared solely based on information provided by Choi. The rental units central to this matter were a thrift shop and a restaurant. Miguel Arvizu was the lessee for both of these units. The rental agreement f or the restaurant listed a monthly rental of $3,800, and the rental agreement for the thrift shop called for $2,000 per month. With respect to the restaurant, Arvizu typically paid somewhere between $300 and $800 per month, although he had free rent for J anuary through April

2 Byoung Kuk Choi was named as a defendant below. Default was entered against him in May 2019.4

2014. He rarely paid anything close to $2,000 monthly for the thrift shop. Arvizu had a long relationship with the late Mr. C hoi , who wanted Arvizu to succeed. They had entered into an oral side

agreement, whereby Arvizu would perfo rm maintenance in common areas and would be credited against the rent for the
value of his time. This oral side

- agreement was not disclosed to Yoon. Despite the existence of the side agreement, Arvizu signed estoppel certificates for each tenancy

, which represented that there were no other agreements than the written lease. The estoppel certificates were also signed by Choi , who initially claimed to have very little knowledge of anything having to do with the property

. U ltimately she admitted knowledge of the
side

- agreement. Fabricated rental receipts for Arvizu’s two leases were given to Yoon during the escrow. The trial court found that the receipts were most likely fabricated by Byoung Kuk Choi acting
on behalf of his mother. The rent rolls that we re provided to Kim, which she copied on her letterhead and gave to Yoon, also contained false information. They showed monthly payments of $4,500 per month for the restaurant, and $2,700 per month for the thrift shop. Thus, Yoon was led to believe that t he rents from the commercial property would be $7,200 per month more than they turned out to be. Appellants purchased the property in reliance on the information provided by Choi. Fraudulent misrepresentations were made by and on behalf of Choi

, which ca used financial loss to appellants. The misrepresentations in the estoppel certificates were made by Choi herself, who had knowledge that the representation of no agreement other than the written lease was5

false , and nevertheless signed the documents. The other misrepresentations were made by her son, to whom she delegated certain responsibilities, for which she was responsible. In October 2014, escrow closed for the purchase of the property in the amount of $3.6 million. From that transaction, a
commiss ion in the amount of $216,000 was paid to respondents. Arvizu paid no rent to appellants for either the restaurant or the thrift shop. After the close of the sale appellants became

aware material misrepresentations had been made to them during the trans action with regard to the unpaid rents.

PROCEDURAL HISTORY Pleadings
On June 23, 2015, appellants filed a complaint against Choi and respondents alleging breach of contract

, breach of the covenant of good faith and fair dealing

, fraud

— nondisclosure of
material fact

, fraud

— misrepresentation

, negligent misrepresentation

, breach of fiduciary duty

, constructive fraud

, and professional negligence. After various challenges to the complaint, appellants filed a first amended complaint on December 14, 2015. Following further challenges, appellants filed the operative second amended complaint (SAC) on January 20, 2017. On August 11, 2017, the trial court sustained respondents’
demurr er to the SAC without leave to amend as to the third
cause of action for fraud

— nondisclosure of material fact

, the
fourth cause of action for fraud

— misrepresentation

, the fifth cause of action for negligent misrepresentation

, and the seventh
cause of actio n for constructive fraud.6 On August 24, 2017, respondents filed their answer to the
SAC. On March 5, 2019, Choi filed her answer to the SAC.
Trial
A seven

- day bench trial commenced on February 4, 2020. Appellants called Paul Russell, an appraiser

, as a witness

. Russell testified that the fair market value for the property on
October 8, 2014, was $2

. 49 million . Appellants also called Lawrence Jacobson, a licensed real estate broker and attorney, as an expert witness. Jacobson testified that respondent s did not meet the standard of care in representing appellants in the
transaction. Jacobson opined that in preparing estoppel certificates, the broker should go through the tenants. Instead respondents went through the seller. In addition, Jacobson

test ified that respondents lacked familiarity with the area and lacked understanding of the responsibilities of a commercial real estate agent in valuing property. During trial, appellants moved to amend their complaint to conform to proof and add a cause of action for constructive fraud against respondents

, which th e trial court denied in its written decision following trial.
The court’s decision
On March 20, 2020, the trial court issued a tentative decision. On April 3, 2020, appellants filed objections to the tentative statement of decision and a request for hearing. On July 21, 2020, the trial court entered its final statement of decision. The court found that appellants relied on the misrepresentations made by Choi, who had knowledge of th eir falsity. As to respondents, the trial court found insufficient evidence to prove appellants’ claims against respondents and found on their behalf against appellants.7 The court noted that appellants’ expert, Jacobson, was unconvincing because he never addressed the scope of respondents’ duties while acting as dual agents. Further, the court was not convinced of Jacobson’s position that respondents were required to “look behind” the documents provided by the seller. The court knew of no authority that a broker is required to conduct an audit of the information supplied by the seller. Further, the court found that Yoon did not exercise due diligence in determining the fair market value of the property. He made an offer to close on the asking price wit hout having seen the property and did not consult with a real estate appraiser before investing in the property. The court found Kim was legally prohibited from advising appellants as to the price they should pay for the property , citing Civil Code sectio n 2079.16, 3 which provides: “In representing both Seller and Buyer, a dual agent may not, without the express permission of the respective party, disclose to the other party confidential information, including, but not limited to, facts relating to either the Buyer’s or Seller’s financial position, motivations, bargaining position, or other personal information that may impact price, including the Seller’s willingness to accept a price less than the listing price or the Buyer’s willingness to pay a price g reater than the price
offered.” In calculating damages against Choi, the court referred to the testimony of Russell , who “described how commercial property is considered ‘stable’ when 80% of the units are fairly rented.” Russell considered the subject pr operty, “as is,” to be at

3 All further statutory references are to the Civil Code unless otherwise indicated.8

64 percent occupancy. Russell explained that it can take up to three years for a rental property to be stabilized. Thus, the “‘prospective upon stabilized’ value as of October 2017” was $2.63
million. The court therefore conclu ded that the property’s “‘cost to stabilization’ was $110,000, which would represent [appellants ’ ] damages, with one complication.” The court explained the “complication” as follows: “When
Mr. Yoon became aware of the inadequate rent payments during
the e scrow period, [the parties] signed amended escrow
instructions

. . . whereby $41,000 was to be held back from escrow to account for unpaid rent. [Appellants] received $31,000 from that sum, which should be deducted from the ‘cost to
stabilization’ amount. ” Thus, the court awarded appellants

“ $110,000 minus $31,000, or $78,900” against Choi. The court noted that it had bifurcated the issue of punitive damages and set a hearing on the punitive damages phase of
trial.
On March 17, 2021, the court entered j udgment in favor of appellants and against Choi and Byoung Kuk Choi for compensatory damages in the amount of $78,900, punitive damages in the amount of $315,600, and prejudgment interest in the amount of $192,923.32 for a total award of $587,423.37. Appe llants were awarded nothing against respondents. On May 13, 2021, appellants filed their notice of appeal from the judgment.

DISCUSSION
I. Standards of review Appellants raise two issues on appeal. First, they argue that the trial court improperly calculated damages. Second, they9

argue the trial court erroneously denied their motion to amend the pleadings to conform to proof. “An appellant’s challenge to dama ges, depending upon its specific nature, may be subject to a substantial evidence, abuse of discretion, or de novo standard of review.” ( JMR Construction Corp. v. Environmental Assessment & Remediation Management,
Inc. (2015) 24 3 Cal.App.4th 571, 583.) “ The question of whether ‘a certain measure of damages is permissible given the legal right the defendant has breached, is a matter of law, subject to de novo review.’” ( Ibid. ) “But where the measure of damages is legally permissible, a trial court’s choi ce of that measure, among other legally permissible measures of damages, is reviewed for abuse of discretion.” ( Ibid. ) “A trial court may allow the amendment of a pleading at any time up to and including trial.” ( Faigin v. Signature Group Holdings, Inc. (2012) 211 Cal.App.4th 726, 736.) While such leave should ordinarily be liberally granted in the absence of prejudice to the opposing party, leave to amend a complaint is properly denied “if the proposed amendment

. . . would not
establish a basis for li ability as a matter of law.” ( Ibid. ) We
review the record to determine whether substantial evidence supports the fact finder’s determination that there was no liability under the proposed amendment to the pleading. ( Ibid. )
II. Compensatory damages Appellan ts argue that the trial court did not apply the proper measure of compensatory damages against Choi. Appellants argue that the court failed to provide any authority to justify the cost to stabilization basis for its damage calculation. Instead, appellant s assert that the proper basis for calculating damages is found in section 3343, subdivision (a), which provides,10

in part, that “[o]ne defrauded in the purchase, sale or exchange of property is entitled to recover the difference between the actual
value of that with which the defrauded person parted and the
actual value of that which he received

. . . . ” Appellants point out that they paid $3.6 million for the property, and the fair market value of the property on October 8, 2014, was $2.49 million. As a result, appellants argue, the proper amount of compensatory damages is $1.11 million. We find the trial court’s calculation of damages permissible and did not constitute an abuse of its discretion. First, we note section 3343, subdivision (a) (1) , permits a court to take into consideration “[a]mounts actually and reasonably expended in reliance upon the fraud.” ( I talics added.) Here, as appellants admit, the trial court found that appellants’ $1 million overpayment for the property “was not due to any
mi srepresentations by the seller or any act of Ms. Kim.” Instead, appellants overpaid “because [they] didn’t exercise diligence in determining the fair market value of the property.” Appellants “made an offer close to the asking price without having seen t he property, and didn’t consult with anyone such as a real estate appraiser before determining whether to invest several million dollars in a piece of commercial real estate in the Mojave desert.” Appellants do not argue a lack of substantial evidence to support the trial court’s factual conclusion that the cause of appellants’ overpayment was their own lack of due diligence. Instead, appellants argue that their own due diligence is not
relevant

, cit ing Seeger v. Odell (1941) 18 Cal.2d 409, 414 ( Seeger )
f or the proposition that the negligence of a party in discovering the falsity of a statement is not a defense to fraud. Seeger involved a real estate transaction induced by fraudulent11

misrepresentations. The Seeger court noted the above proposition of law , asserting that “[n]egligence on the part of the plaintiff in failing to discover the falsity of a statement is no defense when the misrepresentation was intentional rather than negligent.” ( Ibid. ) Thus, “[t]he fact that an investigation would
have reve aled the falsity of the misrepresentation will not alone bar his recovery

. . . . ” ( Id. at pp. 414

- 415 ) Here, in contrast to Seeger , the failure of appellants in discovering Choi’s false statements is not at issue. The court explicitly found that appell ants did not overpay the full $1 million due to Choi’s false statements. Instead, the trial court found that appellants overpaid due to their own failure to conduct adequate diligence. 4 While the trial court did not award appellants the full $1
million overpayment, it awarded appellants damages for their losses fairly attributable to Choi’s false statements. As set forth in its written order, the trial court endeavored to calculate the damages proximately caused by Choi’s false statements. In doing

so, the court relied on the testimony of appellants’ expert witness,
Russell. 5 Taking into consideration the state of the rental units

4 The other two cases cited by appellants on this point are similarly distinguishable because they involve the buyer’s failure to discover the fa lsity of the seller’s statements. ( Piazzini v. Jessup (1957) 153 Cal.App.2d 58, 61 [“plaintiff buyer ‘has the right to rely on a vendor’s representation as to the qua nt ity of land’”]; see Mills v. Hellinger (1950) 100 Cal.App.2d 482, 487.)

5 A ppellants argue that the trial court erred because it failed to name a legal basis for its use of the “cost to stabilization” method of calculating damages . A ppellants invited any such error by presenting Russell’s testimony, on which the trial court reli ed. ( Saxena v. Goffney (2008) 159 Cal.App.4th 316, 32912

at the time of appellants’ purchase, Russell “came up with what [he] thought the value

— or cash flow ought to be once it’s stabilized, once it is properly managed

. . . and how much cost or time it would take to get to a stabilized situation.” Russell concluded that as to the property at issue, this cost would be $110,000. The trial court took this number from appellants’

ex pert, and subtracted a set

- off that appellants received in escrow for unpaid rent. The court’s calculation of compensatory damages was reasonable and supported by the record. No abuse of discretion
occurred.
III. Constructive fraud A fiduciary may be liable for constructive fraud even though his or her conduct is not actually fraudulent. ( Salahutdin v. Valley of California, Inc. (1994) 24 Cal.App.4th 555, 562 ( Salahutdin ).) The Salahutdin court explained:

“ ‘ [A]s a general principle constructive fraud comprises any act, omission or concealment involving a breach of legal or equitable duty, trust or confidence which results in damage to another even though the conduct is not otherwise fraudulent . Most acts by an agent in breach of his fiduciary duties constitute constructive fraud. The failure of the fiduciary to disclose a material fact to his principal which might affect the fiduciary’s motives or the principal’s decision, which is known (or should be known) to the fiduciary, may constitute constructive fraud. ’ ” ( Ibid .)

[“‘“Where a party by his conduct induces the commission of error, he is estopped from asserting it as a ground for reversal” on appeal.’”].)13 The elements of a cause of action for fraud are (1) a fiduciary relationship

, (2) nondisclosure (breach of fiduciary duty)

, (3) intent to deceive

, and (4) reliance and resulting injury. ( Younan v. Equifax Inc. (1980) 111 Cal.App.3d 498, 516

, fn. 14.) The trial court sustained respondents’ demurrer without leave to amend as to appellants’ constructive fraud cause of action against them, and denied appellants’ motion to conform the pleadings to assert a cause of action for constructive fraud during trial. 6 As the trial court noted, there are differences between the fiduciary obligations of an exclusive representative of the seller or buyer and a du al agent representing the seller and the buyer. ( Horiike v. Coldwell Banker Residential Brokerage Co. (2016) 1 Cal.5th 1024, 1031 ( Horiike ) .) 7 The primary difference is that

6 As respondents point out, appellants are not clear on the precise trial court decision they are challenging on appeal. Because the matter proceeded to trial and all of the facts have been conclusively established, we analyze only the denial of appellants’ motion to add a cause of action for constructive fraud d uring trial.

7 In Horiike , the Supreme Court held that when an individual associate represents a brokerage in a real property transaction, his or her duties are the same as those of the brokerage. ( Horiike, supra

, 1 Cal.5th at p. 1036.) Horiike involved a dual agency where the buyer discovered a significant discrepancy between the square footage of the residence’s living area and what was represented in the marketing materials. ( Id. at pp. 1028

- 1029.) The high court acknowledged “the potential for confli cts of interest in the dual agency context,” but declined to address this point further, as the issue in that case “create[d] no such conflict.” ( Id. at p. 1040.)14

dual agents must “both inform their clients of the agency relationships involve d and obtain the clients’ consent.” ( Horiike

, at p. 1 0 30.) Section 2079.16 recognizes that an agent representing both the seller and the buyer has “[a] fiduciary duty of utmost care, integrity, honesty, and loyalty in the dealings
with either Seller or t he Buyer.” ( Ibid

. [“AGENT REPRESENTING BOTH SELLER AND BUYER”].) 8 While appellants are correct that dual agents have certain fiduciary obligations to both the buyer and the seller, those obligations do not include a duty to confirm the veracity of all

8 Respondents point out that section 2079 , which requires a “real estate broker or salespers on

. . . to conduct a reasonably competent and diligent visual inspection of the property offered for sale and to disclose

. . . all facts materially affecting the value or desirability of the property,” appl ies exclusively to sales of “residential real pr operty improved with one to four dwelling units.” ( § 2079, subd. (a) ; see Smith v. Rickard (1988) 205 Cal.App.3d 1354, 1360.) Thus, the obligations found in section 2079 do not apply to this commercial real estate transaction. However, respondents cite no authority that the disclosures set forth in section 2079.16 are inapplicable in a commercial transaction such as the one at issue in this case. Further, we note th at the Rickard court expressly found that regardless of the limited application of section 2079, a buyer may still state a claim for breach of fiduciary duty against an agent or broker. ( Rickard,

supra , at p. 1363; see Field v. Century 21 Klowden

- Forness Realty (1998) 63 Cal.App.4th 18, 21 [concluding “the fiduciary duty of a broker, who contracts to exclusively represent a purchaser of real property to investigate for its client, is independent of the separate obligation imposed on a seller’s broker to co nduct a reasonable visual inspection of the marketed property for a buyer’s protection, as announced in Easton v. Strassburger (1984) 152 Cal.App.3d 90 and incorporated into section 2079”)15

s tatements made by the seller. Generally, a dual agent has the “duty to disclose all facts known to the agent materially affecting the value or desirability of the property that are not known to, or within the diligent attention and observation of, the par ties.” (§ 2079.16, italics added.) 9 The trial court found that the evidence in this matter did not support a finding that respondents had knowledge of the seller’s false statements, and appellants have not brought a substantial evidence challenge to
thi s finding on appeal. Thus, the elements of nondisclosure and intent to deceive are not supported by the record. Appellants attempt to prevail on the theory that respondents were bound to investigate Choi’s representations regarding the rental income. In support of this argument, they
cite Salahutdin, supra

, 24 Cal.App.4th 555. In Salahutdin , the buyers worked closely with an agent from Coldwell Banker in order to find a property that satisfied their needs. They informed their agent that they wanted to subdivide the property, and the agent explained to them that because they wanted to subdivide the property, they needed a property at least one acre in size. ( Id. at p. 559.) The plaintiffs “knew nothing about subdivision of property before [th eir agent] informed them” of these requirements. ( Ibid. ) The buyers were willing to wait for such a

9 As the trial court noted, there is a specific requirement that du al agents “may not, without the express permission of the respective party, disclose to the other party confidential information, including, but not limited to, facts relating to either the Buyer’s or Seller’s financial position, motivations, bargaining

po sition, or other personal information that may impact price

. . . .” ( § 2079.16 [ “ AGENT REPRESENTING BOTH SELLER AND BUYER”].)16

property. ( Ibid. ) When one came on for sale, the sellers advised their agent

— also of Coldwell Banker

— that the property was one acre in size. This repre sentation turned out to be false. The buyer’s agent misinformed the buyers that because the property was one acre, the buyers would have no problem subdividing it. ( Id. at p. 560.) Without addressing the dual agency issue, the
Salahutdin court found tha t substantial evidence of constructive fraud existed as against the buyers’ agent.
Salahutdin does not assist appellants in this matter. The
Salahutdin court expressly recognized that an agent is not required to investigate the truth of a sellers’ repres entations. Instead, the court emphasized the agent’s duty to inform the
sellers that his statements were not based on his own verification: “While he was not required to investigate the sellers’ representations or the truth of the description contained in the multiple listing service sheet before showing the property to plaintiffs, [the agent] was at least required to tell plaintiffs that he had not verified the information he was passing on to
them

. . . . ” ( Salahutdin, supra

, 24 Cal.App.4th at p. 563.) 10 Here, respondents provided such a disclaimer, explicitly informing the buyer that the information they were passing on regarding the monthly rental income was “not guaranteed.” Because respondents did not have an obligation to investigate the seller’s

s tatements and notified appellants that they had not verified the rental income information, respondents did not breach any

10 Similarly, in Horiike, supra

, 1 Cal. 5th at page 1041, the Supreme Court noted that the agent was required “to disclose such in formation [concerning square footage], or to alert Horiike that his representations were unverified.”17

obligation to appellants. In short, there was no legal basis for a
claim of constructive fraud. 11 Assilzadeh v. California Federal Bank (2000) 82 Cal.App.4th 399 (

Assilzadeh ), also cited by appellants, involved a lawsuit brought by a buyer against the seller, real estate broker, and broker’s agent for failing to disclose in detail the specific defects alleged in a construction defect lawsuit that had been filed concerning the property. The buyer’s real estate agent was employed by the brokerage hired by the seller, thus the agent and his employer acted in the capacity of dual agents. ( Id. at p. 405.)
The Assilzadeh court affirmed su mmary judgment in favor of the defendants, finding that “[t]heir duty was to disclose the existence of the lawsuit to put the buyer on notice of alleged defects, and they fulfilled that duty.” ( Id. at pp. 416

- 417.) Thus,
the Assilzadeh court recognized t hat agents are not required to investigate every aspect of a transaction. In doing so, the Assilzadeh court stated its belief that “a dual agent has fiduciary duties to both the buyer and seller.” ( Assilzadeh, supra , 82 Cal.App.4th at p. 414.) However, the court found the agents’ duties to be limited to disclosure of what they
knew . Because the existence of the lawsuit was disclosed, the

11 S ection 2079.16 also contains a warning to the buyers that “you have the duty to exercise reasonable care to protect yourself, including as to those fac ts about the property which are known to you or within your diligent attention and observation.” ( Ibid

. [“SELLER AND BUYER RESPONSIBILITIES”].) In a case such as this where the both the seller and the tenant were making deliberate, material misrepresenta tions regarding the payment of rent, it is difficult to charge either the buyer or the agent with having knowledge or the ability to observe the true facts, which the seller and the tenant were intentionally hiding.18

agents satisfied their obligation to the client. The agents were not “required to read and analyze the legal documen ts located in the court file.” ( Id. at p. 416

. ) Once they informed the buyer of what they knew, “[a]t that point the buyer should have investigated further and, if necessary, should have hired an attorney for advice on the legal aspects of the lawsuit an d settlement.” ( Ibid .) Similarly, here, respondents informed appellants of rental income information that the seller provided. They also informed appellants that their representations regarding the rental income of the property were “not guaranteed.” A t that point, appellants could have investigated
further. Finally, Jorgensen v. Beach ‘ N’ Bay Realty, Inc. (1981) 125 Cal.App.3d 155 was a lawsuit brought by a seller against her listing agents. The agents represented both the seller and the buyers in th e transaction and failed to disclose to the seller the buyers’ intention to immediately resell the home and the agents’ financial interest in the resale. ( Id. at p. 159.) The agents had a duty “to disclose all material facts within their knowledge which might have affected Jorgensen’s decision to accept the purchaser’s offer.” ( Id. at p. 160

. ) Under the circumstances present in Jorgensen , the evidence of the agents’ knowledge was sufficient to go to a jury on the seller’ s claim of breach of fiduciary duty and related causes of action. Here, in contrast, following trial the trial court found that respondents had no knowledge of19

Choi’s misrepresentations. Thus, Jorgensen is not helpful to appellants. 12
Furthe r, we note that appellants have failed to show that they have suffered any prejudice from the court’s decision to decline to allow them to amend their pleadings to add a constructive fraud claim. Generally, an appellant “‘must “show not only that the tria l court erred, but also that the error was prejudicial”; i.e.

, “ the [appellant] must show that it is reasonably probable the ultimate outcome would have been more favorable to the [appellant] had the trial court not erred

. . . . ” ’” ( Property
Reserve

, Inc . v. Superior Court (2016) 6 Cal.App.5th 1007, 1020; see Cal. Const., art. VI, § 13.) Here, the trial court found that appellants’ claims against respondents for breach of fiduciary duty and professional negligence failed as a factual matter. Appellants have not challenged the outcomes on these causes of action, nor have they explained how they could prevail on a constructive fraud cause of action when respondents were not liable for either breach of fiduciary duty or professional negligence. In sum, app ellants have failed to show that the trial court erred in declining to allow them to amend their complaint to add a cause of action for constructive fraud against respondents, nor have they shown that any such error caused prejudice.

12 We decline to discuss Lee v. Escrow Consultants, Inc. (1989) 210 Cal.App.3d 915, as it involved the fiduciary obligations of an escrow agency and is therefore irrelevant.20 DISPOSITION The judg ment is affirmed. Respondents are awarded their costs of appeal.

___________________________ CHAVEZ, Acting P. J.

We concur:

_______________________________ HOFFSTADT, J.

_______________________________ BENKE, J. *

* Retired Associate Justice of the Court of Appeal, Fourth Appellate District, assign ed by the Chief Justice pursuant to article VI, section 6 of the California Constitution.