Court Opinion

ID: 6323885
Source: CourtListenerOpinion
Date Created: 2022-03-16 19:03:19.292478+00
Date Added: 2024-06-11T09:21:45.337375
License: Public Domain

Filed 3/16/22 Shayesteh v. Welch CA4/1
                 NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication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.

                COURT OF APPEAL, FOURTH APPELLATE DISTRICT

                                                 DIVISION ONE

                                         STATE OF CALIFORNIA

MINOO SHAYESTEH,                                                     D079462

         Plaintiff and Appellant,

         v.                                                          (Super. Ct. No. 2015-1-CV-
                                                                     282358)
NAGIN WELCH,

         Defendant and Respondent.

         APPEAL from a judgment of the Superior Court of Santa Clara,
Sunil R. Kulkarni, Judge. Affirmed.
         The Law Offices of John H. Perrott and John Henry Perrott for Plaintiff
and Appellant.
         Jensen & McDonald and Edward C. McDonald for Defendant and
Respondent.
         Sisters Minoo Shayesteh and Nagin Welch dispute the ownership of
property located at 240 North Cypress Avenue, in Santa Clara, California.
Shayesteh maintains she and her sister provided equal funds for the down
payment and that they both contributed to the mortgage, property taxes, and
maintenance. She filed suit in 2015 to quiet title, among other things. Welch
denied Shayesteh’s allegations, and the matter went to trial in 2018.
Shayesteh sought to introduce recordings she had made of conversations with
her sister about the property. The court excluded one such recording made
November 21, 2013 after concluding it regarded settlement negotiations and

was inadmissible under Evidence Code1 section 1152, subdivision (a) for
purposes of proving liability. Following trial, the court entered judgment in
favor of Welch. Shayesteh appeals the judgment, contending the court erred
by excluding the November 21, 2013 recording. We conclude the trial court
properly excluded the evidence, and we will affirm.
                                      I.
               BACKGROUND AND PROCEDURAL FACTS
      Shayesteh and Welch are sisters who immigrated to the United States
in the late 1970s. Both women married.
      Shayesteh eventually divorced her husband in 2009 after they were
separated for many years. In the early 2000s, Shayesteh feared her husband
would somehow take any money she had, even after they were separated, so
she looked for a safe place to hide the money. She asked her sister Welch to
safeguard or invest the money in real estate on Shayesteh’s behalf.
Shayesteh testified that she gave Welch $1,500 each month for safekeeping
between 2001 and 2004. She also testified that she gave income tax refunds
and child support payments to Welch, and that the funds added up to about
$100,000.

      In 2004, Welch and her husband Timothy2 purchased 240 North

Cypress Avenue, Santa Clara, California as an investment property.3 Welch

1     Further section references are to the Evidence Code.
2     We refer to Timothy Welch by his first name to avoid confusion.

                                       2
paid the down payment from her separate money. The house was titled to
Welch and Timothy as joint tenants; Shayesteh was not named on the deed
but believed her name would be added when Timothy eventually quitclaimed
it. Timothy removed his name from the title around 2005 and confirmed the
removal through a quitclaim deed in 2008, around the time that he and

Welch divorced.4
      Welch rented out the Cypress house beginning in March 2005.
Shayesteh testified that the rent Welch collected did not cover the mortgage
and other expenses, and Shayesteh paid Welch $300 per month, in cash, to
make up the shortfall. Welch testified that there generally were no
shortfalls, and when they occurred, she covered the difference from her own
bank account.
      Shayesteh moved into the Cypress house in October or November 2008.

She testified that she paid $2,5205 per month, and this money was her share
of the mortgage. She also testified that she paid all the property taxes on the
home beginning in 2004. Welch testified that Shayesteh originally paid rent
without being asked to do so, and they eventually signed a lease agreement.
Shayesteh asserted her signature on the lease agreement was forged.
      In November 2011, Welch moved into the Cypress house with
Shayesteh. Shayesteh testified that she continued to contribute to the

3     In some places in the record, the address is listed as located in San Jose
rather than Santa Clara. The recorded deed identifies the address as 240
North Cypress Avenue, Santa Clara, California, Santa Clara County.

4     The record on appeal does not include a copy of the quitclaim deed, and
neither party alleges Shayesteh’s name was added when Timothy filed the
quitclaim deed in 2008.

5    She also testified that $1,000 of the $2,520 was paid to her by a tenant
and one of her adult children who was living there at the time.
                                       3
mortgage and taxes by paying Welch each month. Welch characterized the
money as rent and expense payments. Welch also testified that she paid all
the property taxes for the Cypress property from 2005 to the present.
      Eventually, in 2015, Welch sued Shayesteh for unlawful detainer. In
that proceeding, Shayesteh argued she was an actual owner, she had not
been served with an eviction, and the signature on the lease was not hers.
The court entered an eviction judgment against Shayesteh on July 1, 2015. It
determined Welch was entitled to possession of the Cypress home.
      Shayesteh filed a verified complaint against Welch on June 26, 2015.
The complaint sought to quiet title on the Cypress property. It alleged the
sisters had an agreement for joint, equal ownership of the property. The
complaint also included claims for abuse of process, malicious prosecution,
deed procured by undue influence, constructive trust, intentional infliction of
emotional distress, breach of contract as a third party beneficiary, common
counts - money had and received, tortious assault, premises liability, and
fraud.
      The case proceeded to trial.
                      The November 21, 2013 Recording
      Welch filed a motion in limine to exclude an audio recording and
transcript from a meeting that took place November 21, 2013. She argued
the recording was made without her consent and was privileged because it
was a settlement discussion between the parties. Shayesteh argued the
recording was relevant to toll the statute of limitations for the fraud claim.
      The trial court provisionally admitted Exhibits 44 and 55, the recording
and a transcript of the recording, and it heard testimony about the meeting.

                                        4
      There were four people present at the meeting: Shayesteh, Welch,

their brother Abbas Shayesteh, and their cousin Behrouz Shayesteh.6
Shayesteh testified that she held up her phone and asked the three present if
she could record, and they responded, “Yeah.” Shayesteh acknowledged that
there was no clear statement from Welch, but also reported that Welch did
not decline. Abbas testified that Shayesteh asked if she could record the
meeting and those present said it was okay.
      Shayesteh testified that they “were going through these meetings back
and forth” and “this time” it looked like Welch “really want[ed] it to be really
happening.” Shayesteh believed Welch wanted her to vacate the property
and “wanted to give [me my] money—some money.” Shayesteh told the court
she wanted Welch to pay her $250,000, but that day she agreed to a smaller
amount because they were not going near that number. She said the meeting
resulted in a completed deal.
      Abbas testified that he participated in the meeting to help fix the
problem between the sisters; his purpose was to make peace, and he hoped
that Welch would write a check to Shayesteh. He also said the dollar amount
the parties agreed to was part of a negotiation between the parties that may
or may not have related to what Shayesteh actually paid. He said the
November 2013 agreement was a second attempt to make peace between the
sisters. He also explained that the agreement did not say anything about
who had legal title to the property because Welch would not sign the
document with more detail than it had.
      When the court asked Shayesteh whether, if everyone had done what
they were supposed to do according to the agreement that came out of that

6     Because Abbas and Behrouz share a surname with Minoo Shayesteh,
we refer to them by their first names for clarity.
                                        5
meeting, there would be no more disputes about the house or the title, she
said “That’s right.” Cousin Behrouz also thought the November 2103
agreement settled everything; he expected Welch to write a check to
Shayesteh and for Shayesteh to move out.
      Welch testified that the agreement was a 60-day notice, and if Welch
gave Shayesteh back all the rent Shayesteh had paid, Shayesteh would move
out. Welch said she agreed to it because she loved Shayesteh’s children and
did not want to cause problems. Welch did not pay the money because she
never saw Shayesteh packing; she thought Shayesteh did not really want to
move out, and after the meeting, Shayesteh did not ask to move out.
      The court explained that whether Welch consented to the recording was
an issue for the factfinder to determine, so it would not exclude the recording
on that basis.
      Then, in its statement of decision, the court found that Welch
consented to the November 21, 2013 recording.
      However, the court concluded the recording was inadmissible under
section 1152 subdivision (a) because it contained settlement discussions. The
court explained that Shayesteh had testified that the relevance of the
recording was Welch’s admission therein that she had a substantial amount
of Shayesteh’s money. Because that was directly related to Welch’s liability,
it was inadmissible. It also ruled that testimony regarding the substance of
the meeting was inadmissible for the same reason. Although the court
recognized that the recording could be admitted under the parol evidence rule
to help determine the intended meaning of the language in the November 21,
2013 settlement agreement, because neither party contended the agreement
was ambiguous, it was not admitting it for that purpose.

                                       6
                              April 2014 Recording
        Shayesteh also introduced a recording she made April 16, 2014. In that
recording, Welch can be heard saying to Shayesteh, “[Y]ou have only $55,000
only with me. . . .” Although the court determined the recording was made
illegally, it considered the recorded conversation for impeachment purposes.
                              Additional Evidence
        At trial, Shayesteh and Welch offered evidence to explain where their
contributions to the down payment came from. Shayesteh also introduced
several documents she claimed were signed by Welch that indicated Welch
had agreed to add Shayesteh’s name to the deed. Welch denied signing the
documents, and a handwriting expert could not verify the signatures were
hers.
        Family members and friends testified that it was their understanding
that the Cypress property was owned by Shayesteh and Welch. None of them
had seen any documentation to support this understanding. The court found
the witnesses to be biased.
        The court admitted a document provided to the County of Santa Clara
regarding Medi-Cal benefits that Shayesteh signed in 2006 under penalty of
perjury. It stated that she did not own any property.
        The court found in favor of Welch on all asserted claims and entered
judgment against Shayesteh.
        Shayesteh timely appealed.
                                       II.
                                 DISCUSSION
        We begin by commenting that we presume the judgment is correct, and
it is the appellant’s burden to affirmatively demonstrate error. (Jameson v.
Desta (2018) 5 Cal.5th 594, 608-609.) An appeal is not a second trial, so to

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the extent we are called upon to review factual findings, we apply a
substantial evidence standard of review; we do not reweigh evidence.
(Curcio v. Pels (2020) 47 Cal.App.5th 1, 12.) We also “resolve all factual
conflicts and questions of credibility” in favor of the prevailing party.
(Schild v. Rubin (1991) 232 Cal.App.3d 755, 762.)
      The issue before us here is whether the court properly excluded
evidence. We review the admissibility of evidence, including evidence
excluded under section 1152, subdivision (a), for an abuse of discretion.
(Mangano v. Verity, Inc. (2009) 179 Cal.App.4th 217, 222 (Mangano); Zhou v.
Unisource Worldwide (2007) 157 Cal.App.4th 1471, 1476 (Zhou); Caira v.
Offner (2005) 126 Cal.App.4th 12, 32 (Caira).) In so doing, we ask whether
the trial court’s application of the law to the facts of the case was arbitrary
and capricious. (In re Charlisse C. (2008) 45 Cal.4th 145, 159.)
      “Evidence that a person has, in compromise or from humanitarian
motives, furnished or offered or promised to furnish money or any other
thing, act, or service to another who has sustained or will sustain or claims
that he or she has sustained or will sustain loss or damage, as well as any
conduct or statements made in negotiation thereof, is inadmissible to prove
his or her liability for the loss or damage or any part of it.” (§ 1152, subd. (a);
see Caira, supra, 126 Cal.App.4th at p. 30; Hasler v. Howard (2004) 120
Cal.App.4th 1023, 1026.) The exclusion applies broadly and includes the
offers as well as any statements made in the course of settlement
negotiations. (§ 1152; C & K Engineering Contractors v. Amber Steel Co.
(1978) 23 Cal.3d 1, 13; Caira, at pp. 32-33; Zhou, supra, 157 Cal.App.4th at
p. 1475.) Although statements made during settlement negotiations cannot
be used to prove liability (C & K Engineering, at p. 13), such statements may
be used for other, limited purposes (Truestone, Inc. v. Simi West Indus. Park

                                         8
II (1984) 163 Cal.App.3d 715, 725 [offer to settle different lawsuit admissible
as statement against interest independent of compromise offer]), including to
impeach a defendant’s contrary testimony on direct examination (see, e.g.,
People v. Crow (1994) 28 Cal.App.4th 440, 450-451).

      Shayesteh challenges the court’s exclusion of four exhibits7 and focuses
on its decision to exclude them under section 1152. She first argues the
November 21, 2013 meeting was not a settlement negotiation subject to
section 1152 because litigation had not begun at the time of the meeting.
      This view has been rejected by the court in Mangano. There, the court
considered section 1152 in the context of a wrongful employment termination
suit. Mangano sought to admit evidence of a proposed separation agreement
as evidence of defendant Verity’s liability. (Mangano, supra, 179 Cal.App.4th
at pp. 222-223.) Mangano argued that “any dispute about [his]
termination . . . had not yet arisen at the time of the proposed separation
agreement,” and the agreement therefore was not subject to section 1152.
(Mangano, at pp. 222-223.) The appellate court disagreed, explaining
nothing in section 1152 limits its application to offers to compromise
preexisting disputes. (Mangano, at pp. 222-223.)
      The plain language of section 1152 makes clear that an offer “in
compromise or from humanitarian motives . . . to furnish money . . . as well
as any conduct or statements made in negotiation thereof . . . is inadmissible

7     Exhibits 21, 48, and 55 are transcripts of the conversation that
occurred November 21, 2013. The court replaced Exhibits 21 and 48 with
Exhibit 55 because Exhibit 55 was transcribed by a court interpreter rather
than one of the parties. The court provisionally admitted Exhibit 55, the
transcript by the interpreter, subject to Welch’s objections regarding consent
and section 1152. Exhibit 44 was the audio recording of the November 21,
2013 meeting, during which participants spoke in English and Farsi. The
court provisionally admitted it, subject to Welch’s objections. Shayesteh did
not lodge a copy of the recording with the appellate court.
                                       9
to prove his or her liability for the loss.” (§ 1152, subd. (a).) The court here
explored the purpose of the November 21, 2013 meeting and concluded it was
a settlement negotiation. This conclusion is well-supported by the record.
      Although the existence of a dispute at the time of an offer of
compromise is not a prerequisite to applying section 1152 (see Mangano,
supra, 179 Cal.App.4th at pp. 222-223), here a dispute predated the
November meeting. Shayesteh testified that they had been going through
meetings back and forth, and although she wanted Welch to pay her
$250,000, they agreed to a smaller amount. This indicates the parties had a
dispute, and they negotiated and compromised to reach a final agreement,
subjecting the substance of the meeting to section 1152.
      Abbas’s testimony, like Shayesteh’s, reflected the existence of a dispute.
He testified that he participated in the meeting to fix a problem and make
peace. This was his second attempt to make peace between his sisters,
showing that their dispute predated the meeting. He also explained that the
dollar amount they agreed to in the final agreement was negotiated and may
or may not have related to money Shayesteh actually paid Welch, further
indicating some sort of compromise and negotiation had occurred.
      Their cousin’s testimony similarly acknowledged a dispute had
predated the November meeting because he believed the agreement resulting
from the meeting settled everything.
      Welch’s testimony also supports the court’s conclusion. She testified
that she did not owe Shayesteh any money, but she agreed to pay Shayesteh
because she loved Shayesteh’s children and did not want to cause problems.
Her testimony suggests she promised money from more humanitarian
motives, understanding her sister would sustain the loss of housing.
Although she paints her motives as humanitarian rather than as a

                                        10
negotiated settlement, her explanation nonetheless supports the exclusion of
evidence about the meeting’s substance to establish liability under
section 1152. (See § 1152.)
      Taken together, the evidence indicates the meeting was held to address
a conflict or dispute between the sisters or that the offer to pay came from
some humanitarian motive regarding a future loss of housing. Therefore, the
court’s application of section 1152 was appropriate.
      The case law Shayesteh cites to support her position that the parties
must be engaged in active litigation for section 1152 to apply is not helpful.
In Preciado v. Wilde (2006) 139 Cal.App.4th 321 (Preciado), the Preciados
and Wilde were tenants in common. (Id. at p. 323.) In a suit to quiet title,
the Preciados attempted to demonstrate adverse possession, but Wilde
testified “she had no notice that the Preciados wanted to interfere with her
right to possession and title.” (Id. at p. 325.) At trial, Wilde introduced
evidence of a letter in which the Preciados offered to buy her interest. (Id. at
p. 326.) On appeal, the Preciados argued it was error to admit the letter
because the letter was an offer to compromise. (Ibid.) But the court of appeal
concluded that section 1152 was inapplicable because there were no
discussions to settle any dispute over ownership; the offer was simply a buy-
out offer. (Preciado, at p. 326.)
      Preciado cites to Price v. Wells Fargo Bank (1989) 213 Cal.App.3d 465
(Price). In Price, the parties entered a series of loan agreements. The Prices
conceded they never disputed the demands for payment or the amounts of
money they owed, and they made payments of interest and principal without
contesting their obligations. (Id. at 480.) On appeal, they argued the court
should have excluded letters from the Prices’ attorney asking the bank to
hold off on demanding payment to allow for a less catastrophic solution. (Id.

                                       11
at p. 481 & fn 3.) But the appellate court found nothing in the record to
suggest the parties disputed the existence or even the terms of the loan; the
letters themselves disclosed there was no dispute. (Id. at p. 481, fn. 3.)
      Neither of these cases held that active litigation was necessary to find
the existence of a dispute. The courts in those cases simply concluded the
parties involved were “not engaged in discussions to settle a dispute about
ownership.” (Preciado, supra, 139 Cal.App.4th at p. 326; see Price, at p. 481,
fn. 3.) And although Shayesteh attempts to compare her situation to the one
in Preciado, her attempt falls short. In her reply brief, Shayesteh argues
there was no evidence of a dispute between her and Welch; the November 21,
2013 communication was a buy-out. But this claim is contradicted in the
record, as we discussed ante. There was ample evidence for the court to
conclude there was a “longstanding dispute” between the sisters that justified
its application of section 1152 here.
      Shayesteh makes several additional arguments for why the court
should have admitted the substance of the November 21, 2013 meeting, none
of which has merit. She contends that an offer of compromise proposed as
impeachment evidence would always swallow the prohibition on admitting
the substance of settlement discussions, effectively voiding section 1152.

                                        12
Whether this is theoretically true was not tested here because Shayesteh did
not ask to introduce the recording as impeachment evidence. Thus, this issue

is not before us.8
      Shayesteh argues the court acted inconsistently because it admitted
the recording made in April 2014 without Welch’s consent, but it excluded the
consented-to recording from November 2013. However, this argument
ignores the court’s rationale and conflates consent with other requirements
for admissibility. After explaining that the question of consent was one of
fact, the court, in its factfinding capacity, concluded Welch consented to the
November 21, 2013 recording. This meant the court could admit the
recording as substantive evidence in the absence of some other rule
precluding it. But because the court also concluded the communication was a
settlement negotiation, it excluded the 2013 recording under section 1152. In
contrast, Welch did not consent to being recorded in 2014, which meant the
court could not admit the contents as substantive evidence. Instead, the
court considered the recording as potential impeachment evidence. The 2014
recording differed from the 2013 recording both because section 1152 was not
implicated, and because it was admitted for impeachment purposes. There
was no inconsistency.

8     Shayesteh also argues that the court elevated the policy underlying
section 1152 above the policy prohibiting perjury. Shayesteh did not request
the admission of the recording for the purpose of impeaching Welch. Had she
done so, the court could have contemplated Welch’s statements during that
meeting as evidence challenging her credibility without treating them
expressly as true (or false). This is how the court handled the admission of a
recording made April 16, 2014; it explained that the recording was not
admissible as substantive evidence because it was not legally made, but it
could be used for impeachment.
                                       13
      Shayesteh next argues that because Welch consented to being recorded,
she should be estopped from “conceal[ing] the truth” of what she said during
the conversation. But Welch’s consent to being recorded did not waive her
right to later object to the admission of the evidence in court under
section 1152. Shayesteh does not explain why it would have.
      Finally, Shayesteh argues that the November 2013 recording contains
proof of fraud because it evidences a false promise of compromise and
therefore should have been admitted. Her theory is that the recording from
November 2013 demonstrates the settlement communication was an
insincere settlement overture designed to discourage her from suing. But,
again, evidence in the record contradicts this view.
      Shayesteh testified that it seemed like Welch really wanted them to
come to an agreement on November 21, 2013. And she believed Welch
wanted to give her money in exchange for vacating the property. She told the
court their final agreement that day was a completed deal, and if everyone
had done what they were supposed to, there would be no more disputes about
the Cypress property. Behrouz likewise told the court he expected Welch to
write a check to Shayesteh and Shayesteh to move out. Even Welch
intimated that she believed the agreement was a 60-day notice and if she
returned rent to Shayesteh, Shayesteh would move out. Her lack of payment
was not the result of insincerity on her part, but because she perceived
Shayesteh’s inaction to indicate Shayesteh did not want to follow through
with their agreement. In other words, there is evidence to support the court’s

conclusion that this was not a situation where there was promissory fraud.9

9     Shayesteh did not claim fraud regarding the executed settlement that
resulted from the November 21, 2013 meeting.
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                              DISPOSITION
     The judgment is affirmed. Welch is entitled to her costs on appeal.

                                                              HUFFMAN, J.

WE CONCUR:

McCONNELL, P. J.

DO, J.

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