Court Opinion

ID: 6111670
Source: CourtListenerOpinion
Date Created: 2022-01-21 21:02:04.517561+00
Date Added: 2024-06-11T08:54:20.242505
License: Public Domain

Filed 1/21/22 Quicken Mortgage v. Bank of America, N.A. CA4/3

                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication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

                                     FOURTH APPELLATE DISTRICT

                                                 DIVISION THREE

 QUICKEN MORTGAGE
 CORPORATION et al.,
                                                                       G059249 (consol. w/ G059590)
      Plaintiffs and Appellants,
                                                                       (Super. Ct. No. 30-2016-00832654)
                     v.
                                                                       O P I N I ON
 BANK OF AMERICA, N.A.,

      Defendant and Respondent.

                   Appeal from a judgment of the Superior Court of Orange County, Martha
K. Gooding, Judge. Affirmed.
                   Law Offices of Lee E. Burrows and Lee E. Burrows for Plaintiffs and
Appellants.
                   Severson & Werson, Jan T. Chilton and Kerry W. Franich for Defendant
and Respondent.

                                             *               *               *
                                    INTRODUCTION
              An essential element of the causes of action for fraud and negligent
misrepresentation is justifiable reliance; that is, the circumstances were such as to have
made it reasonable for the plaintiff to accept the representation as true without conducting
an independent investigation. It is axiomatic that a plaintiff cannot reasonably rely on a
representation if the plaintiff knows or has information that the representation is false.
Applying these principles, we affirm a judgment of nonsuit against Quicken Mortgage
Corporation (Quicken Mortgage) and Bahram Dadvar in their lawsuit against Bank of
America, N.A. (Bank of America).
              Bahram Dadvar alleged that in reliance on a letter from Bank of America,
he, on behalf of Quicken Mortgage, entered into a joint venture agreement with a
company owned by Sirous Razipour. Dadvar contended the letter, which purported to
confirm various accounts held by Razipour at Bank of America, vastly overstated the
balance of a certificate of deposit. When the relationship between Dadvar and Razipour
collapsed, for reasons unrelated to the balance of that certificate of deposit, Quicken
Mortgage and Dadvar sued Bank of America for fraud and negligent misrepresentation.
              However, after receiving the letter from Bank of America and before
entering into the joint venture agreement, Dadvar received documents disclosing that the
certificate of deposit balance reflected on the letter was inaccurate; in particular, Dadvar
received Razipour’s bank account statements and a renewal notice for the certificate of
deposit. Dadvar testified he would have glanced at the account balances in Razipour’s
bank statements and, if those balances were different from those in the letter, which they
were, he would know the letter was inaccurate. Dadvar sent a copy of the certificate of
deposit renewal notice to a prospective lender. Dadvar, together with Razipour, prepared
a loan application which listed the certificate of deposit as an asset of Razipour and
identified the correct balance.

                                              2
              This evidence led the trial court to grant Bank of America’s motion for
nonsuit, and leads us, exercising de novo review, to affirm. The undisputed facts
establish that Dadvar’s reliance on the letter was manifestly unreasonable as a matter of
law in light of information in his possession showing that the letter inaccurately stated the
balance of the certificate of deposit.
              We also affirm on a ground raised by Bank of America in its motion for
nonsuit but not relied upon by the trial court: Under the undisputed facts, there was no
causal link between Dadvar’s reliance on the representation made in the letter from Bank
of America about the certificate of deposit balance and damage Quicken and Dadvar
Mortgage might have suffered. Dadvar relied on the letter as providing assurance that
Razipour had sufficient funds to satisfy the financial obligations imposed on him by the
joint venture agreement. Razipour satisfied all of his financial obligations, and then
some.
                                          FACTS
                 I. Bank of America Issues the Proof of Funds Letter
              As the standard of review directs, we accept as true the evidence most
favorable to Quicken Mortgage and Dadvar, draw every reasonable inference in their
favor, and disregard conflicting evidence. (Nally v. Grace Community Church (1988) 47
Cal.3d 278, 291 (Nally).)
              Dadvar is a real estate investor who has been engaged in selling real estate
and has developed about 15 or 16 high-end properties over a period of 20 years.
Razipour is the sole shareholder of Matasco Enterprises, Inc. (Matasco).
              Sometime in 2012, Razipour told Dadvar that Razipour was “coming into
some money” and asked Dadvar to let him know if Dadvar had found a good real estate
investment. Later in 2012, Dadvar told Razipour that Dadvar was looking for investors
to help him purchase, remodel, and ultimately sell a large residential property (the

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Peppertree Property) in San Juan Capistrano. Dadvar told Razipour that the Peppertree
Property had fallen out of escrow and was “a very good deal.”
              Dadvar had worked with investment partners about five times in the past
when he lacked sufficient funds. When considering a partner for a development project,
honesty and financial wherewithal were important to Dadvar. To determine whether
Razipour had sufficient assets to purchase and remodel the Peppertree Property, in
January 2013, Dadvar asked Razipour to provide a verification of the amount of funds in
his bank accounts.
              On January 15, 2013, Dadvar and Razipour went to the Fashion Island
branch of Bank of America to obtain a letter confirming Razipour’s funds. Dadvar and
Razipour were given a letter (the Proof of Funds Letter) on Bank of America letterhead
and signed by Bijan Saadati, banking center manager and assistant vice-president. The
Proof of Funds Letter stated Razipour was “the president of Global Liquidation
Company,” had been “a valued client of ours since 1999,” and had an “outstanding
relationship with our financial institution.” The Proof of Funds Letter confirmed that
Razipour had four accounts at Bank of America. One account was a certificate of
deposit, No. 4425, which according to the Proof of Funds Letter had a balance of
$3,121,015.20.
              Razipour did not look at the Proof of Funds Letter until the next day. When
he did, he saw that the account balance for the certificate of deposit was wrong. At the
time the Proof of Funds Letter was prepared, the balance of the certificate of deposit was
only $289,308.59 and the maturity date was September 5, 2013.
              Dadvar testified that, within two weeks after receiving the Proof of Funds
Letter, he called Saadati and asked him whether the information in the letter was accurate
and whether there were any recent changes to the information in it. Dadvar explained
that he was “doing a partnership with Mr. Razipour” and was calling “to verify” that the

                                             4
Proof of Funds Letter was accurate. Saadati told Dadvar the information in the Proof of
                                                                             1
Funds Letter was accurate and that Razipour was “a very good customer.”

                     II. Dadvar Receives Razipour’s Bank Account
                         Statements, Including a Renewal Notice
                              for the Certificate of Deposit
              After receiving the Proof of Funds Letter, Dadvar and Razipour agreed they
would need to obtain a loan to fund the purchase of the Peppertree Property. Dadvar was
placed in charge of obtaining the loan because he had experience in the mortgage
industry and, as such, was responsible for putting together the loan application and
submitting all the paperwork to prospective lenders. Razipour provided Dadvar copies of
his Bank of America account statements, including a renewal notice for the certificate of
deposit, and Dadvar scanned the documents into his computer. The renewal notice,
which was dated December 12, 2012, stated the certificate of deposit “had renewed
automatically” with a current balance as $289,308.59 and a new maturity date of
September 5, 2013.
              Razipour went to Dadvar’s house and together they filled out a loan
application. The loan application listed the certificate of deposit, with a balance of
$289,308.59, as an asset of Razipour.
              On January 28, 2013, Dadvar sent a prospective lender an e-mail to which
were attached copies of Razipour’s bank statements, including the renewal notice from
Bank of America for Razipour’s certificate of deposit.
              Dadvar testified that if he had received Razipour’s bank statements he
would have glanced at them to check the average balance for the prior month. He
testified too that if Razipour’s bank statements had disclosed account balances different

1
  Saadati testified he did not remember that call from Dadvar, ever meeting with Dadvar
and Razipour, preparing the Proof of Funds Letter, or preparing any proof of funds letters
for any clients while he worked as a Bank of America manager. Saadati testified the “S”
in his signature on the Proof of Funds Letter appeared to be “off.”

                                              5
from those in the Proof of Funds Letter, he would have known the Proof of Funds Letter
was inaccurate. Dadvar claimed that Razipour’s bank statements, including the renewal
notice, did not alert him that the Proof of Funds Letter was inaccurate because the bank
statements predated the letter by one to two months and account balances can change
over time.
                   III. Quicken Mortgage and Matasco Enter into
                            the Joint Venture Agreement
             On February 4, 2013, Quicken Mortgage and Matasco entered into a joint
venture agreement (the Joint Venture Agreement) for the purchase, development, and
sale of the Peppertree Property. The Joint Venture Agreement identifies Dadvar as the
                                       2
sole shareholder of Quicken Mortgage. Dadvar signed the Joint Venture Agreement as
the authorized agent of Quicken Mortgage.
             The Joint Venture Agreement required Quicken Mortgage and Matasco
each to bear 50 percent of the responsibility of funding the down payment of $748,000 on
the Peppertree Property. Quicken Mortgage agreed to meet its down payment obligation
by contributing a Bentley automobile with an agreed-upon value of $200,000 and
$174,000 in cash. Title was to be taken “50/50” in the names of Quicken Mortgage and
Matasco, and net profits were to be split “50%-50% to the entities having title.” Quicken
Mortgage and Dadvar agreed to pay up to $10,000 for the costs of remodeling the
property, while Matasco and Razipour agreed to contribute up to $300,000 for
remodeling costs. The expectation was to resell the Peppertree Property within one year.
             Dadvar relied on the Proof of Funds Letter when he entered into the Joint
Venture Agreement on behalf of Quicken Mortgage. He would not have entered into the
Joint Venture Agreement if the information in the Proof of Funds Letter were not true

2
  That representation was false: Dadvar’s ex-wife, Sabrina Thornbury, was the sole
shareholder of Quicken Mortgage when it entered into the Joint Venture Agreement.
Dadvar testified he did not acquire his shares in Quicken Mortgage until sometime in mid
to late 2018 or early 2019, long after the date of the Joint Venture Agreement.

                                            6
because the letter provided him assurance that Razipour had the financial wherewithal to
“qualify to do a project like that.”

               IV. Project Costs Spiral Upward; The Parties Enter into
                   an Addendum to the Joint Venture Agreement
              In February 2013, Quicken Mortgage and Matasco obtained a $1,695,000
loan and successfully purchased the Peppertree Property for a price of $2,575,000.
Matasco and Razipour satisfied their obligation under the Joint Venture Agreement of
paying $300,000 toward remodeling costs.
              The original plan was to complete a “minor” remodel of the Peppertree
Property before reselling it. By April 2013, the remodel budget had increased from
$300,000 to $472,500 so the parties changed their plan and decided to undertake a
“major” remodel instead. Dadvar expected Razipour to cover the increased construction
costs, and Razipour did as expected.
              Construction costs continued to spiral upward. In July 2013, Dadvar
prepared a new budget of $800,000. He expected Razipour to pay all of the remodeling
costs. In October 2013 the project budget had increased to $1,090,000—three and
one-half times the amount agreed upon in the Joint Venture Agreement. At about this
time, late October or early November 2013, Razipour told Dadvar that the Proof of Funds
Letter was “likely fudged.”
              Razipour wanted a new joint venture agreement to account for the
additional funds he had put into the project and to place a cap on spending. Although
Dadvar initially refused, in March 2014 Quicken Mortgage and Matasco entered into an
addendum to the Joint Venture Agreement (the Addendum). The Addendum recited that
the original scope of improvements had been exceeded and that Matasco had contributed
about $750,000 over the purchase money. The Addendum placed a cap on spending of
$1,250,000 for all improvements. Because $950,000 had been spent, Quicken Mortgage
and Matasco each agreed to contribute $150,000 ($300,000) to finish the project.

                                            7
However, a few days later Dadvar informed Razipour that $379,000 would be needed to
complete the project.

                         V. The Relationship Between Dadvar
                             and Razipour Deteriorates
              By the summer of 2014 the relationship between Dadvar and Razipour had
deteriorated to the point that both were leveling personal insults against each other and
had hired attorneys. Dadvar and Razipour ended up suing each other.
              At about this time, in 2014 or 2015, Dadvar, while at a Bank of America
branch, asked the branch manager whether the Proof of Funds Letter was accurate. The
manager researched the matter and told Dadvar “the balances were not even close.”
              The lawsuit between Dadvar and Razipour went to arbitration. The
arbitrator ordered the appointment of a receiver to sell the joint venture’s assets. In
August 2018, the Peppertree Property was sold at a receiver’s sale for $6,588,888. After
paying off all debts, fees, payoffs, and commissions, including amounts contributed by
Quicken Mortgage and Matasco/Razipour, the receiver held $866,000 of which $670,000
ultimately were disbursed to Razipour and the rest disbursed to Quicken Mortgage.
                               PROCEDURAL HISTORY
              In January 2016, Quicken Mortgage and Dadvar filed a complaint against
Matasco, Razipour, and Bank of America for fraud, negligent misrepresentation, and
concealment. Quicken Mortgage and Dadvar alleged that Bank of America had made
false representations to them about Razipour’s account balances and, in reliance on the
representations, Quicken Mortgage and Dadvar had entered in the Joint Venture
Agreement.
              The case was tried to a jury in February 2020 on the claims of intentional
and negligent misrepresentation. At the close of the plaintiffs’ case-in-chief, Bank of
America brought a motion for a nonsuit. The motion was made on four grounds:
(1) Quicken Mortgage and Dadvar failed to prove justifiable reliance because the

                                              8
evidence at trial showed that they learned of the correct balance of Razipour’s certificate
of deposit before entering into the Joint Venture Agreement; (2) Quicken Mortgage and
Dadvar adduced no evidence that the Proof of Funds Letter caused them any harm
because the evidence showed that Matasco had exceeded its financial obligations under
the Joint Venture Agreement; (3) the evidence at trial proved that the negligent
misrepresentation cause of action was barred by the two-year limitations period; and
(4) Quicken Mortgage and Dadvar impliedly waived their misrepresentation claims by
entering into the Addendum after discovering that the Proof of Funds Letter was
inaccurate.
              The trial court granted the motion for nonsuit on the first, third, and fourth
grounds. The court found: (1) Dadvar’s testimony established that before Quicken
Mortgage entered into the Joint Venture Agreement Dadvar had documents and
information showing the balance of Razipour’s certificate of deposit was some $2.8
million less than the balance reflected on the Proof of Funds Letter; (2) after learning that
the Proof of Funds Letter likely had been “fudged,” Dadvar went ahead and, on behalf of
Quicken Mortgage, entered into the Addendum; and (3) the negligent misrepresentation
claim was barred by a two-year statute of limitations. In addition, the court found that
Dadvar lacked standing to sue Bank of America on his own behalf because he was never
a party to the Joint Venture Agreement or the Addendum.
              A judgment and an amended judgment incorporating a cost award were
entered in favor of Bank of America. Quicken Mortgage and Dadvar timely appealed
from the judgment and separately appealed from the amended judgment. The two
appeals were consolidated for all purposes.
                                      DISCUSSION
                I. Standard of Review/Standard for Granting Nonsuit
              We review an order granting nonsuit de novo by using the same standard as
the trial court. (Nally, supra, 47 Cal.3d at p. 291; Holistic Supplements, LLC v. Stark

                                              9
(2021) 61 Cal.App.5th 530, 541.) A defendant is entitled to a nonsuit if the court
determines, as a matter of law, the evidence presented by the plaintiff is insufficient to
permit a jury to find in the plaintiff’s favor. (Nally, supra, at p. 291.) In determining
whether the plaintiff’s evidence is sufficient, the court may not weigh the evidence or
consider witness credibility but must accept as true the evidence most favorable to the
plaintiff and disregard conflicting evidence. (Ibid.) The court must interpret the
evidence most favorably to the plaintiff and draw every reasonable inference, and resolve
all presumptions, conflicts, and doubts, in the plaintiff’s favor. (Ibid.; see Castaneda v.
Olsher (2007) 41 Cal.4th 1205, 1214.)
              “A mere ‘scintilla of evidence’ does not create a conflict for the jury’s
resolution; ‘there must be substantial evidence to create the necessary conflict.’” (Nally,
supra, 47 Cal.3d at p. 291.) Evidence is legally insufficient when no substantial evidence
exists tending to prove each element of the plaintiff’s claim. (Adams v. City of Fremont
(1998) 68 Cal.App.4th 243, 263, disapproved on another ground in Brown v. USA
Taekwondo (2021) 11 Cal.5th 204, 219, 221; Fountain Valley Chateau Blanc
Homeowner’s Assn. v. Department of Veterans Affairs (1998) 67 Cal.App.4th 743,
750-751.)

                II. As a Matter of Law, Quicken Mortgage and Dadvar
                    Failed to Present Evidence Sufficient to Establish
                                   Justifiable Reliance
              Justifiable reliance is an essential element of both fraud and negligent
misrepresentation. (Small v. Fritz Companies, Inc. (2003) 30 Cal.4th 167, 173-174.)
“‘Besides actual reliance, [a] plaintiff must also show “justifiable” reliance, i.e.,
circumstances were such to make it reasonable for [the] plaintiff to accept [the]
defendant’s statements without an independent inquiry or investigation.’ [Citation.] The
reasonableness of the plaintiff’s reliance is judged by reference to the plaintiff’s
knowledge and experience.” (OCM Principal Opportunities Fund, L.P. v. CIBC World

                                              10
Markets Corp. (2007) 157 Cal.App.4th 835, 864 (OCM); accord West v. JPMorgan
Chase Bank, N.A. (2013) 214 Cal.App.4th 780, 794.)
              “The recipient of a fraudulent misrepresentation is not justified in relying
upon its truth if he knows that it is false or its falsity is obvious to him.” (Rest.2d Torts,
§ 541.) “Although the recipient of a fraudulent misrepresentation is not barred from
recovery because he could have discovered its falsity if he had shown his distrust of the
maker’s honesty by investigating its truth, he is nonetheless required to use his senses,
and cannot recover if he blindly relies upon a misrepresentation the falsity of which
would be patent to him if he had utilized his opportunity to make a cursory examination
or investigation.” (Id., § 541, com. a., p. 89.)
              Whether a plaintiff’s reliance was reasonable is a question of fact except
when the undisputed facts do not permit a reasonable difference of opinion. (OCM,
supra, 157 Cal.App.4th at pp. 864-865; West v. JPMorgan Chase Bank, N.A., supra, 214
Cal.App.4th at p. 794.)
              The evidence presented at trial by Quicken Mortgage and Dadvar was
insufficient as a matter of law to establish the element of justifiable reliance. The theory
of recovery alleged in the complaint and presented at trial was that in reliance on the
Proof of Funds Letter, Quicken Mortgage and Dadvar were induced into entering into the
Joint Venture Agreement. The Joint Venture Agreement was signed on February 4,
2013. Dadvar received the Proof of Funds Letter on January 15, 2013. But after
receiving the Proof of Funds Letter, and before the date of the Joint Venture Agreement,
Dadvar received Razipour’s bank account statements, including the renewal notice for
Razipour’s certificate of deposit. Dadvar testified that Razipour came to his home and
together they prepared the loan application. Razipour testified he brought his bank
statements with him and Dadvar scanned them into Dadvar’s computer.
              The renewal notice identified the current balance of the certificate of
deposit as $289,308.59 and the new maturity date as September 5, 2013. Dadvar testified

                                              11
that, before entering into the Joint Venture Agreement, he and Razipour together
prepared a loan application. The loan application identified Razipour’s certificate of
deposit and gave the balance as $289,308.59.
              On January 28, 2013, before the date of the Joint Venture Agreement,
Dadvar sent to a prospective lender an e-mail to which were attached copies of
Razipour’s bank statements, including a renewal notice from Bank of America for
Razipour’s certificate of deposit.
              Dadvar testified that, within two weeks of January 15, 2013, he had a
telephone conversation with Saadati at Bank of America in which Saadati stated the
information in the Proof of Funds Letter was accurate. But Dadvar also testified that if
Razipour’s bank account statements showed account balances that were different from
those reflected in the Proof of Funds Letter, he would know the Proof of Funds Letter
was inaccurate. He further testified that he would have checked the balances on
Razipour’s bank account statements. The renewal notice thus alerted Dadvar that the
Proof of Funds Letter was inaccurate.
              Dadvar contends he was justified in relying on the Proof of Funds Letter
instead of Razipour’s bank account statements because those statements were four to
eight weeks old and account balances can change. This argument does not overcome a
nonsuit. The renewal notice, which was dated just a month earlier than the Proof of
Funds Letter, was not for a checking or savings account, to which funds could be
deposited or withdrawn, but for a certificate of deposit with a specified balance. The
renewal notice states that the certificate of deposit “has renewed automatically” with a
balance of $289,308.59. The loan application, which Dadvar helped to prepare, identifies
the certificate of deposit as having a balance of $289,308.59. Thus, regardless of what
the Proof of Funds Letter reflected, the renewal notice and loan application demonstrate
that Dadvar knew of the correct balance of the certificate of deposit before entering into
the Joint Venture Agreement.

                                            12
              Dadvar argues repeatedly that justifiable reliance is a question of fact that
must be decided by a jury. But, as we have explained, justifiable reliance may be decided
by a nonsuit motion when the undisputed facts do not permit a difference of opinion.
(OCM, supra, 157 Cal.App.4th at pp. 864-865; West v. JPMorgan Chase Bank, N.A.,
supra, 214 Cal.App.4th at p. 794.) Justifiable reliance may be decided by nonsuit against
a plaintiff “if [the plaintiff’s] conduct is manifestly unreasonable in the light of [the
plaintiff’s] own intelligence or information.” (Hartong v. Partake, Inc. (1968) 266
Cal.App.2d 942, 965.)
              Dadvar testified he was a highly experienced real estate developer and had
been placed in charge of obtaining a loan due to his experience in the mortgage industry.
The evidence presented by Dadvar established that after receiving the Proof of Funds
Letter, and before entering the Joint Venture Agreement, he received Razipour’s bank
account statements, including the certificate of deposit renewal notice, at least took note
of the account balances, worked with Razipour to prepare a loan application that
disclosed the accurate balance of the certificate of deposit, and sent the certificate of
deposit renewal notice along with Razipour’s bank account statements to a prospective
lender. Dadvar testified that he would have known that the Proof of Funds Letter was
inaccurate if Razipour’s bank account statements showed different account balances,
which they did.
              This evidence permits no difference of opinion: Dadvar’s reliance on the
Proof of Funds Letter was manifestly unreasonable as a matter of law in light of his
intelligence, his experience, and information in his possession. Dadvar could not have
been justified in relying on the balance of the certificate of deposit reflected in the Proof
of Funds Letter because he knew that information was false.

                                              13
               III. As a Matter of Law, Quicken Mortgage and Dadvar
                         Failed to Present Evidence Sufficient
                                 to Establish Causation
              We also affirm the judgment of nonsuit on the ground that Quicken
Mortgage and Dadvar failed to present substantial evidence of causation; that is,
Dadvar’s reliance on the Proof of Funds Letter was the proximate cause of damages.
Although the trial court did not grant a nonsuit on the ground of lack of evidence of
causation, Bank of America specified causation as a ground in its motion. We may
affirm a nonsuit on any ground specified in the motion, regardless whether the trial court
granted relief on that ground. (Lawless v. Calaway (1944) 24 Cal.2d 81, 92-94; Saunders
                                                3
v. Taylor (1996) 42 Cal.App.4th 1538, 1542.)
              Proximately caused or resulting damage is an element of fraud and
negligent misrepresentation. (Small v. Fritz Companies, Inc., supra, 30 Cal.4th at
pp. 173-174.) “[D]amage causation is an essential element of any cause of action for
fraud or negligent misrepresentation.” (Id. at p. 202.) A party asserting fraud must prove

3
  Several Court of Appeal opinions hold that appellate review is limited to those grounds
relied upon by the trial court because the appellate court should only examine those
grounds which a plaintiff might have been able to correct had they been called to the
plaintiff’s attention. (E.g., DeVaughn Peace, M.D., Inc. v. St. Francis Medical Center
(1994) 28 Cal.App.4th 454, 459; see Alpert v. Villa Romano Homeowners Assn. (2000)
81 Cal.App.4th 1320, 1328, fn. 8 [noting split of authority over whether review of grant
of nonsuit is limited to grounds raised by defendant and ruled on by trial court].) Those
opinions are based on an erroneous interpretation of Lawless v. Calaway, supra, 24
Cal.2d 81. The rule pronounced in Lawless was that “grounds not specified in a motion
for nonsuit will be considered by an appellate court only if it is clear that the defect is one
which could not have been remedied had it been called to the attention of plaintiff by the
motion.” (Id. at p. 94, italics added.)

  In Lawless the Supreme Court held “merely that a judgment of nonsuit usually cannot
be affirmed on a ground not specified below by the moving party because it would
deprive the plaintiff of the opportunity to remedy any defects in its proof.” (Saunders v.
Taylor, supra, 42 Cal.App.4th at p. 1542, fn. 2.) “That rationale does not bar the
consideration on appeal of alternative grounds which were stated by the moving party but
which were not among those relied upon by the trial court in granting the motion.”
(Ibid.)

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the fraudulent conduct was the proximate or legal cause of the plaintiff’s damages.
(OCM, supra, 157 Cal.App.4th at p. 870.) Thus, a plaintiff asserting fraudulent
misrepresentations must prove the alleged misrepresentations were the proximate cause
of the harm claimed to have been suffered by the plaintiff. (Beckwith v. Dahl (2012) 205
Cal.App.4th 1039, 1062.) “‘Assuming . . . a claimant’s reliance on the actionable
misrepresentation, no liability attaches if the damages sustained were otherwise
inevitable or due to unrelated causes.’” (Goehring v. Chapman University (2004) 121
Cal.App.4th 353, 365 [plaintiff’s damages caused by academic dismissal from law
school, not misrepresentations inducing him to enroll].)
              There was no causal link between Dadvar’s reliance on the Proof of Funds
Letter and whatever damage Quicken Mortgage and Dadvar might have suffered. Dadvar
testified that he relied on the Proof of Funds Letter as providing assurance that Razipour
had the assets to purchase and remodel the Peppertree Property; that is, Razipour had the
ability to “qualify to do a project like that.” But the causes of the breakdown in the
relationship between Quicken Mortgage/Dadvar and Razipour were unrelated to
Dadvar’s reliance on the Proof of Funds Letter. Regardless whether the Proof of Funds
Letter was accurate or not, Razipour had sufficient funds to satisfy his financial
obligations under the Joint Venture Agreement and the Addendum. Razipour had enough
money to pay Matasco’s share of the down payment and the $300,000 for remodeling
costs under the Joint Venture Agreement. Razipour continued to cover construction costs
as they spiraled upward, and the Addendum acknowledges that he had contributed
$750,000 over and above the purchase money. In the Addendum, Matasco agreed to pay
an additional $150,000 to finish the project, and no evidence was presented that Razipour
did not or was unable to make that payment.
              Razipour fully performed Matasco’s financial obligations under the Joint
Venture Agreement and Addendum. When a contractual relationship is alleged to have
been induced by fraud, but the contract is performed by the party who made the

                                             15
misrepresentations, there is no causal connection between the other party’s reliance on
the misrepresentations and alleged damages. (Service by Medallion, Inc. v. Clorox Co.
(1996) 44 Cal.App.4th 1807, 1818 [“If the contract had not been performed, we might
agree that these expenditures constituted damages proximately caused by the
misrepresentations”].)
              Thus, the evidence established as a matter of law that the joint venture’s
failure was not due to Dadvar’s reliance on any representations made in the Proof of
Funds Letter. Quicken Mortgage’s and Dadvar’s damages, if any, were due to causes
unrelated to the Razipour’s financial condition or the correct balance of his certificate of
deposit at Bank of America.
                                      DISPOSITION
              The judgment is affirmed. Respondent to recover costs on appeal.

                                                  FYBEL, J.

WE CONCUR:

MOORE, ACTING P. J.

GOETHALS, J.

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