Opinion ID: 779064
Heading Depth: 2
Heading Rank: 4

Heading: Damages Awarded for Fraud and Breach of Contract

Text: 60 Defendants argue that the district court erred in awarding separate damages on identical evidence of wrongful conduct. See Tavaglione v. Billings, 4 Cal.4th 1150, 1159, 17 Cal.Rptr.2d 608, 847 P.2d 574 (1993). Where legal availability of damages is concerned, fraud in the inducement and breach of contract causes of action can support separate damage awards, provided the actions arise out of different obligations and different operative facts. Baker v. Superior Ct., 150 Cal.App.3d 140, 146, 197 Cal.Rptr. 480 (1983); see Symcox v. Zuk, 221 Cal.App.2d 383, 391, 34 Cal.Rptr. 462 (1963) (fraud in the inducement and breach of contract claims support tort and contract damages in the same judgment where claims involve separate rights); Pat Rose Assocs. v. Coombe, 225 Cal.App.3d 9, 18-20, 275 Cal. Rptr. 1 (1990) (fraud and contract damages available where damage was distinct and entire amount could have been awarded under fraud theory). 61 In this case, the district court's findings of fact indicated that on Plaintiffs' breach of contract claim, Plaintiffs Marble and Schnabel were damaged from the failure to account for, or pay, any of the profits obtained from the sales of the Time Machine and Top Secret projects in the underlying sale of the rides to Suzhou Amusement Land. In awarding damages for the breach, the court gave seven specific ways in which the contracts were breached, involving failure to account for the partnership profits from the project sales to Suzhou. Judgment was awarded on these damages, based on the calculation of lost profits in the breach of the partnership agreement. 62 On Plaintiffs' claims of fraud in the inducement, the court cited a lack of intent to perform under the contract, and concealment of that lack of intent. In addition, the district court noted that, as a result of Defendants' fraud, Plaintiffs Schnabel and Marble were deprived of the opportunity to market and reproduce the rides; i.e., resell the rides to other amusement park owners other than Suzhou. Awarding damages for fraud in the inducement, the court awarded fraud damages which represented their share of the lost profits from resales of the Top Secret and Time Machine rides. Judgment was entered against Defendants on Plaintiffs' fraud claims in this amount. 63 In its findings of fact and conclusions of law, the district court did recite facts which were relevant to both breach of contract and fraud claims. However, the court distinguished between breach of contract damages and fraud damages. The damages for breach of contract were directly based on the unaccounted profits obtained by Defendants from Suzhou, and not paid to Plaintiffs Schnabel and Marble. By contrast, the fraud damages were based on the lost opportunity to resell the rides to other vendors. Where the fraud damage is a distinct harm, there is no double counting in the damage award. As a consequence, the district court did not award damages that were clearly unsupported by the evidence, and thus did not commit clear error.