Court Opinion

ID: 9905165
Source: CourtListenerOpinion
Date Created: 2023-11-28 21:05:24.012501+00
Date Added: 2024-06-11T09:20:39.124017
License: Public Domain

Filed 11/28/23
                 CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                 SECOND APPELLATE DISTRICT

                        DIVISION EIGHT

 TIFFANY BUILDERS, LLC, et           B314861
 al.,
                                     Los Angeles County
        Plaintiffs and Appellants,   Super. Ct. No. EC068240

        v.

 DAVID DELRAHIM et al.,

      Defendants and
 Respondents.

      APPEAL from a judgment of the Superior Court of
Los Angeles County, Ralph C. Hofer, Judge. Affirmed in part,
reversed in part, and remanded.
      MK Smith, Jason K. Smith and Mark T. Kearney for
Plaintiff and Appellant.
      Bleau Fox, Martin Fox and Lana Lukyanov for Defendants
and Respondents.
                       ____________________
       At a coffee shop in Calabasas, David Delrahim made
Edwart Der Rostamian a business proposal. Rostamian got his
notebook, asked a server for a pen, and worked with Delrahim to
compose two pages of text. When they were done, each man
signed the paper. Rostamian later sued Delrahim on contract
claims. The trial court granted Delrahim’s motion for summary
judgment, ruling the Calabasas writing was too indefinite to be a
contract. We reverse that point but affirm the ruling against
Rostamian’s claims for tortious interference with a contract.
                                   I
       According to Rostamian, the Calabasas discussion
concerned the purchase of 13 gas stations. He argues that, if
considered in the context of his and Delrahim’s ongoing
negotiations, their signed writing was a binding contract.
       We set out the context Rostamian gave the trial court. This
account is one-sided because Delrahim chose not to offer
declarations giving his version of the facts. This one-sided
account was the record in the trial court.
       The gas stations in question belonged to seller Ibrihim
Mekhail, operating through a family trust. Mekhail was not at
the coffee shop and is not a party to this case.
       Mekhail was selling the 13 stations as a block. He was
offering nine of the 13 with their attached land and the other four
without the land: only the businesses were for sale. The parties
called the four the “dealer sites.”
       Rostamian had been seeking to complete a deal with
Mekhail through Rostamian’s company Tiffany Builders LLC, but
the deal bogged down. Tiffany had signed a purchase agreement
with Mekhail for the 13 stations. Rostamian assembled a group
of other investors, including one Carol International, Inc., willing

                                 2
to buy Mekhail’s stations for about $12.8 million. Rostamian
opened an escrow to which Carol had contributed about $250,000,
but the escrow did not close for various reasons. Rostamian
eventually would assign Tiffany’s rights in the deal to Carol
International, although it is not clear exactly when this
happened. In any event, Rostamian kept searching for a way to
consummate the transaction and to profit from his efforts.
       A mutual acquaintance introduced Rostamian to Delrahim,
who expressed interest in the stations. Delrahim owned a
company named Blue Vista Partners. Over an interval of some
nine months, Rostamian and Delrahim met twice in Studio City
and then continued to discuss, via email and text, ways to make a
deal. Then in November 2015, Delrahim said he had a proposal
to discuss in person with Rostamian. The two met at the
Calabasas coffee shop.
       Delrahim proposed Rostamian should back his company
out of the pending escrow so Delrahim could buy the stations
from Mekhail for $12.4 million, or less if Delrahim and
Rostamian could negotiate a lower price. Delrahim would pay
Rostamian $500,000 to do this. Delrahim also proposed
Rostamian would own the four dealer sites. Delrahim would
charge Rostamian a monthly fee to run these dealer sites, and
Rostamian would reap their profit.
       Delrahim and Rostamian worked together to word their
deal. This two-page hand-written document is central to this
appeal. We call it the Writing.
       We quote this Writing, with corrected spellings and
capitalizations and with bracketed numbers for clarity:

                                3
       “[1] From $12,400,000, bring the value to X amount
difference between $12.4 million and X amount will be allocated
based on the following.
       “[2] $500,000 to Tiffany Builders to get out of the
GlenOaks escrow.
       “[3] Balance will be charged against purchase of 4 dealer
sites from 3rd party based on existing allocated price. That is
provided the X amount covers the entire value.
       “[4] 4 stations will be run 100% by David Delrahim (buyer
of the 13 stations) in behalf of Edward Rostamian for 24 months
or sooner with $4,000 per month cost for the 4 stations.”
       “X Edwart Rostamian [handwritten signature]
       “X David Delrahim [handwritten signature]”
       Rostamian explained the Writing in his declaration.
       Section [1] referred to the $12.4 million Delrahim was
willing to pay for the 13 stations. The men inserted the “X
amount” because they thought they could negotiate the price to
less than $12.4 million. “We didn’t know how much lower we
could negotiate so we put X in there as a placeholder, but we
would obviously be able to fill in the X with the actual contract
price that would ultimately be signed between [Delrahim’s
company] Blue Vista Partners and Mekhail.”
       Section [2] meant Delrahim and Blue Vista would pay
Rostamian and Tiffany $500,000 for backing out of the escrow so
Delrahim could open his own escrow for the purchase of the
stations.
       Section [3] referred to the four dealer sites. Rostamian and
Tiffany would own them and would pay Delrahim and Blue Vista
to operate them. Rostamian would take the operating fee out of
his profits from the stations.

                                 4
       Section [4] explicated section [3] by setting the operating
fee at $4,000 per month, which was $1,000 for each station.
Section [4] also established Delrahim would be listed on title as
the owner until either Rostamian got listed as owner or they sold.
       In short, Delrahim would take the lead in the stations deal
in return for guaranteeing benefits for Rostamian. Delrahim
would rescue Rostamian’s foundering escrow for Delrahim’s own
benefit: Delrahim would buy the 13 stations at a price the two
hoped they could negotiate down from the $12.4 million figure.
Delrahim would own nine stations that were not dealer sites, and
would gain a $4,000 a month fee for operating the four dealer
sites. Delrahim would pay Rostamian $500,000 and would give
Rostamian ownership of, and profits from, the dealer sites.
       None of that happened. To Rostamian’s dismay, Delrahim
decided to deal directly with Mekhail and to cut Rostamian out of
the picture. Delrahim bought the 13 stations for about $11
million. Rostamian got nothing.
       Rostamian and Tiffany sued Delrahim and Blue Vista for
breach of contract, specific performance, intentional and
negligent interference with prospective economic advantage, and
unfair business practices. Delrahim and Blue Vista moved for
summary judgment. The trial judge issued a tentative ruling,
heard argument, adopted the tentative ruling, but then recused
himself. The case was assigned to a different judge, who set
aside the earlier ruling and reset the summary judgment
hearing. The parties filed new papers. Rostamian added his own
declaration to the record before the court. Delrahim did not
contribute a declaration from any percipient witness.
       The trial court granted Delrahim’s summary judgment
motion. The court reasoned the Writing was too indefinite to be a

                                5
contract. The court considered the parol evidence from
Rostamian’s declaration but concluded this evidence failed to
clarify the terms to a legally acceptable degree. The court ruled
the most critical omission was who would own the 13 gas stations
upon completion of the deal. Delrahim had argued Rostamian’s
declaration was a sham because it contradicted Rostamian’s
deposition testimony. The court took note of this argument and
responded in the alternative. For two portions of the declaration,
the court observed it could disregard portions of this declaration,
but it elected not to do so. The court did disregard, however, one
portion of the declaration. The court ruled that, “[t]o the extent
Rostamian now testifies in his declaration definitively that he
was to be the owner of any portion of the stations,” the court
would disregard this claim. In the alternative, even were it to
consider all of Rostamian’s declaration, the court ruled the
contract was still too uncertain to enforce. The court also rejected
Rostamian’s other claims, as we shall explain.
       Rostamian and Tiffany appeal the judgment against them.
                                  II
       As supplemented by parol evidence, the Writing was
definite enough to be an enforceable contract. The grant of
summary judgment was error. Our review is independent.
(Harris v. Thomas Dee Engineering Co., Inc. (2021) 68
Cal.App.5th 594, 604 (Harris).)
                                  A
       Three streams of law converge to control this case.
                                  1
       The first rule concerns parol evidence, also called extrinsic
evidence.

                                 6
       Chief Justice Traynor wrote the “test of admissibility of
extrinsic evidence to explain the meaning of a written instrument
is not whether it appears to the court to be plain and
unambiguous on its face, but whether the offered evidence is
relevant to prove a meaning to which the language of the
instrument is reasonably susceptible.” (Pacific Gas & Electric Co.
v. G. W. Thomas Drayage & Rigging Co. (1968) 69 Cal.2d 33, 37.)
       Rostamian’s declaration satisfied this test. It was relevant
to prove a meaning to which the Writing was reasonably
susceptible. The trial court did not rule to the contrary. It
properly accepted Rostamian’s explanation of the Writing.
       Delrahim incorrectly argues that Rostamian’s assertion
that the contract is unambiguous estops him from arguing
extrinsic evidence provides clarity. Briefing commonly, and
acceptably, argues in the alternative. (E.g., Kavruck v. Blue
Cross of California (2003) 108 Cal.App.4th 773, 782 [position that
document unambiguous does not concede that, if ambiguity is
found, it should be resolved against that party].)
                                  2
       The Writing, as explicated by Rostamian, was not too
indefinite to enforce. It was not an illusory contract. When
people pen their names to a document they have drafted together,
the law accords their act a potent meaning. Delrahim and
Rostamian signed their joint creation, thereby enacting a ritual
signifying commitment: an exchange of promises. Courts strive
to effectuate designs like that. Powerful authority proves it.
                                  a
       We construe instruments to make them effective rather
than void. This rule is of cardinal importance. (Edwards v.
Arthur Andersen LLP (2008) 44 Cal.4th 937, 954.) The law leans

                                7
against destroying contracts because of uncertainty. If feasible,
courts construe agreements to carry out the reasonable intention
of the parties. (Patel v. Liebermensch (2008) 45 Cal.4th 344, 349.)
       “An interpretation which gives effect is preferred to one
which makes void.” (Civ. Code, § 3541.) “A contract must receive
such an interpretation as will make it lawful, operative, definite,
reasonable, and capable of being carried into effect, if it can be
done without violating the intention of the parties.” (Id., § 1643.)
Courts will imply stipulations necessary to make a contract
reasonable regarding matters to which the contract manifests no
contrary intention. (Id., § 1655.)
       Indefiniteness as to an essential term may prevent the
creation of an enforceable contract, but indefiniteness is a matter
of degree. All agreements have some degree of indefiniteness.
People must be held to their promises. If the parties have
concluded a transaction in which it appears they intend to make
a contract, courts should not frustrate their intention if it is
possible to reach a just result, even though this requires a choice
among conflicting meanings and the filling of gaps the parties
have left. This rule comes nearer to attaining the purpose of the
contracting parties than any other. (Rivers v. Beadle (1960) 183
Cal.App.2d 691, 695–696 [citing Corbin on Contracts, vol. 1, § 95,
pp. 288–292].)
       There are two reasons not to enforce an indefinite
agreement. First, the agreement may be too indefinite for the
court to administer—no remedy can be properly framed. Second,
the indefiniteness of the agreement may show a lack of
contractual intent. Courts should be slow to come to this
conclusion. “Many a gap in terms can be filled, and should be,
with a result that is consistent with what the parties said and

                                 8
that is more just to both than would be a refusal of enforcement.”
(1 Corbin on Contracts § 4.3 [fns. omitted].)
       “The terms of a contract are reasonably certain if they
provide a basis for determining the existence of a breach and for
giving an appropriate remedy.” (Rest. 2d of Contracts § 33 (2);
see Facebook, Inc. v. Pacific Northwest Software, Inc. (9th Cir.
2011) 640 F.3d 1034, 1037–1038 [applying California law].)
       “When the parties to a bargain sufficiently defined to be a
contract have not agreed with respect to a term which is essential
to a determination of their rights and duties, a term which is
reasonable in the circumstances is supplied by the court.”
(Rest.2d Contracts, § 204.)
                                   b
       Rostamian’s explanation of the Writing made it definite
enough for judicial enforcement. His version, which was binding
on the trial court at the summary judgment stage, was a series of
clear promises. First, he would withdraw from the escrow to give
Delrahim pride of place, allowing Delrahim to profit from
Rostamian’s effort in finding and trying to exploit this business
opportunity. Second, Rostamian would cooperate with
Delrahim’s effort to negotiate from Mekhail a price lower than
$12.4 million. Third, Rostamian would pay Delrahim $4,000 a
month to operate the four gas stations referred to as dealer sites.
In return, Delrahim made three clear promises of his own: to pay
Rostamian $500,000; to grant Rostamian ownership of, and
profits from, the four dealer sites; and to operate the four dealer
sites for Rostamian.
       This exchange of promises was an enforceable contract.
       The trial court ruled that four inexactitudes fouled the
deal. None, however, sufficed to invalidate it.

                                 9
       First, the court objected that Rostamian did not identify the
location of the gas stations at issue. These locations, however,
were known to or easily discoverable by Delrahim and
Rostamian: the 13 stations already were the subject of a deal in
escrow for millions of dollars. A contract omitting details of the
subject matter is enforceable when context or parol evidence can
reveal the subject matter. (Cf. Klein v. Asgrow Seed Co. (1966)
246 Cal.App.2d 87, 99 [“When two parties bargain on an equal
basis and the buyer is willing to buy a pig in a poke there is no
policy of the law to prevent such a transaction."].)
       Second, the court wrote it was not clear who would own the
nine stations that were not dealer sites. But Rostamian’s
declaration showed Delrahim would be stepping into Rostamian’s
shoes as buyer. The reasonable implication was that Delrahim,
as buyer, would be owner.
       Third, the trial court saw an ambiguity as to whether the
deal included just the individuals—Rostamian and Delrahim—or
whether it also included their entities: Tiffany Builders LLC and
Blue Vista Partners. So far as the record appears, however,
Rostamian was sole owner of Tiffany and Delrahim was sole
owner of Blue Vista. If ever some alter ego or similar question
were to arise, standard motion practice and allied procedures
would enable resolution of this eventuality. This hypothetical
issue did not invalidate the parties’ exchange of promises.
       Fourth, the court balked at the parties’ use of the X term.
Recall Rostamian declared that he and Delrahim had inserted
the X in the agreement as a placeholder to be replaced with the
final contract price Delrahim’s company would pay Mekhail.
       Using X to denote a price-related term did not destroy this
contract.

                                10
       A contract need not specify price if price can be objectively
determined. The absence of a price provision does not render an
otherwise valid contract void. (Cal. Lettuce Growers v. Union
Sugar Co. (1955) 45 Cal.2d 474, 481–482 (Lettuce Growers).)
       In the process of negotiating an agreement, price is a term
frequently left indefinite and to be settled by future agreement.
If the parties provide a practical method for determining this
price, there is no indefiniteness that prevents the agreement from
being an enforceable contract. (1 Corbin on Contracts (2023
supp.) § 4.3.)
       “[A]lthough the necessity for definiteness may compel the
court to find that the language used is too uncertain to be given
any reasonable effect, when the parties’ language and conduct
evidences an intent to contract, and there is some reasonable
means for giving an appropriate remedy, the court will strain to
implement their intent.” (1 Williston on Contracts (4th ed. 2023
supp.) § 4:30 [fns. omitted]; see also Perdue v. Crocker Nat. Bank
(1985) 38 Cal.3d 913, 923–924 [bank signature card was a
contract authorizing charges for processing checks drawn on
accounts with insufficient funds and was not illusory, even
though it did not specify the amount of the charges]; J&A Mash
& Barrel, LLC v. Superior Court of Fresno County (2022) 74
Cal.App.5th 1, 38 [trial court held the contract was unenforceable
because it was not possible to ascertain the purchase price, but
this holding was “not legally tenable”]; Sabatini v. Hensley (1958)
161 Cal.App.2d 172, 175 [“The failure to specify the amount or a
formula for determining the amount of the bonus does not render
the agreement too indefinite for enforcement”]; cf. Moncada v.
West Coast Quartz Corp. (2013) 221 Cal.App.4th 768, 777 [the
contract lacked a price term, but it was definite enough to

                                11
enforce: it provided bases for determining the existence of a
breach and for giving an appropriate remedy]; Purvis v. United
States ex rel. Associated Sand & Gravel Co. (9th Cir. 1965) 344
F.2d 867, 870 [What should a court “do about an item left for
future agreement, but upon which the parties never in the future
agreed[?] What the court should do is what is fair in the
circumstances”].)
       This use of X was acceptably certain. As Rostamian
explained, X was a placeholder to be replaced with the final
contract price Delrahim’s company would pay Mekhail. The
contract provided a formula for ascertaining the presently
unknown sum X, which future events would determine exactly.
The X clause was no barrier to contract enforcement because the
parties had provided a practical and objective method for
determining X’s value. (See Lettuce Growers, supra, 45 Cal.2d at
pp. 481–482.)
       The Writing was definite enough to enforce contractually.
                                  3
       The trial court misapplied the doctrine against sham
declarations. In its statement of decision concerning contract
uncertainty, the court disregarded part of Rostamian’s
declaration. That declaration, however, was consistent with the
relevant portion of Rostamian’s deposition. On this issue,
Rostamian’s declaration was not a sham.
       The sham declaration doctrine comes into play when a
plaintiff makes a clear and unequivocal admission in a deposition
but, in a later declaration, contradicts that admission. In this
situation, the declaration’s previously contradicted assertion
alone cannot establish a triable issue of fact. (Harris, supra, 68

                                12
Cal.App.5th at p. 603 [citing D’Amico v. Board of Medical
Examiners (1974) 11 Cal.3d 1, 21.].)
       This conclusion, however, follows only if there is no credible
explanation for the supposed inconsistency. (See Harris, supra,
68 Cal.App.5th at p. 605.) The doctrine does not apply when a
reasonable explanation resolves the supposed discrepancy. (Id.
at p. 606.)
       The doctrine against sham declarations requires courts to
consider the directness of the asserted contradiction and the
plausibility of harmonizing explanations. We look to the entire
record when determining whether to disregard contradictory
testimony. (Ahn v. Kumho Tire U.S.A., Inc. (2014) 223
Cal.App.4th 133, 144–146 [the question is not whether a
declaration is inconsistent with earlier responses but whether in
light of all of the evidence a reasonable trier could conclude the
earlier responses were a mistake and declaration statements
were credible].) The relevant evidence can include a party’s
explanation for contradictory testimony. (Ibid.)
       The trial court identified a single supposed contradiction
between Rostamian’s deposition and declaration. We quote the
trial court’s ruling on this point.
       “Rostamian testified that, ‘Since I was under contract, he
was going to buy it from me, or replace me, or become a partner
[sic] or an investor.’ [Supplemental Martin Decl., Ex. A,
Rostamian Depo., p. 58]. [⁋] To the extent Rostamian now
testifies in his declaration definitively that he was to be the
owner of any portion of the stations, the declaration can be
disregarded. [Rostamian Decl., paras 24(c) (only the phrase, ‘me
and Tiffany Builders would own them,’ and 24 (d), the sentence, ‘I
would be the owner.’)].”

                                 13
       This excerpt was the trial court’s sole relevant application
of the doctrine against sham declarations. The court applied the
doctrine in the alternative. The court ruled the contract was
illusory even if it did not disregard any of the declaration. We
have just concluded this ruling was error: the contract was not
illusory. Alternatively, the court concluded it could disregard the
assertion in Rostamian’s declaration that Rostamian definitively
would own a portion of the stations. It was error, however, to
disregard Rostamian’s declaration that “definitively he was to be
the owner of any portion of the stations.”
       The supposed contradiction between Rostamian’s
deposition and declaration did not exist.
       Opposing counsel deposed Rostamian and asked him this
question: “Who was [Delrahim] going to buy [the 13 stations]
from?” In context, and drawing reasonable inferences favorable
to the party opposing summary judgment, Rostamian understood
this question to ask this: “When you and Delrahim were
negotiating about how to structure this deal, from whom was
Delrahim going to buy the 13 gas stations?”
       Rostamian answered: “Since I was under contract, he was
going to buy it from me, or replace me, or become a partner or an
investor.”
       Context informs the reasonable interpretation of
Rostamian’s answer. On the same transcript page, Rostamian
explained Delrahim “was determined at $12.4 million to pay for
everything.” Rostamian answered later that he was “negotiating
with [Delrahim] in many occasions, via e-mail, text, and three
meetings. . . . [Delrahim] wanted to see me. So we met at Coffee
Bean in Calabasas.”

                                14
       Rostamian’s deposition answer was consistent with his
declaration. Before Rostamian and Delrahim wrote and signed
the Writing, their discussions were freewheeling and wide
ranging. Rostamian was “under contract” and in escrow with
Mekhail, so one possible form of the deal would be to complete
the escrow and thus to make Rostamian the intermediate buyer,
who then would sell to Delrahim, who would become the ultimate
buyer. Another possibility was for Delrahim to “replace”
Rostamian in the escrow, thus again making Delrahim the
ultimate buyer. Or Delrahim could become Rostamian’s partner,
or he could become an investor in the deal. The two men were
canvassing possibilities before they reached an agreement and
drafted the Writing. In the portion of the declaration the trial
court cited, Rostamian explained that the Writing set out
Delrahim’s promise to allow Rostamian to own the four dealer
sites. Rostamian’s deposition answer did not contradict
Rostamian’s declaration.
       Similarly, there was no contradiction between Rostamian’s
declaration stating in one place “me and Tiffany Builders would
own them” and later stating “I would be the owner.” Tiffany
Builders was Rostamian’s corporation. Rostamian evidently did
not distinguish between his biological self and his corporate self
in this business setting.
       Rostamian’s declaration was internally consistent.
Moreover, the sham declaration doctrine operates to attack a
contradiction between an earlier deposition and a later
declaration. Supposed inconsistencies within a single declaration
are not within its purview.
                             * * * * *

                               15
       In conclusion, we reverse the summary judgment ruling on
the breach of contract claim because the contract was enforceable
and not illusory. This ruling mandates the same result for the
specific performance and unfair competition claims, which the
trial court evaluated under the same analysis.
                                  III
       We affirm the trial court’s treatment of Rostamian’s claims
for tortious interference with prospective economic advantage.
Both negligent and intentional interference with prospective
economic advantage require an economic relationship between
the plaintiff and a third party, which here was Mekhail. (Golden
Gate Land Holdings LLC v. Direct Action Everywhere (2022) 81
Cal.App.5th 82, 91 [intentional interference]; Venhaus v. Shultz
(2007) 155 Cal.App.4th 1072, 1077–1078 [negligent
interference].) But Rostamian’s first separate statement listed as
“undisputed” that, after Tiffany assigned its interest to Carol
International, Tiffany no longer had an interest in the economic
relationship with Mekhail. In his later declaration and second
separate statement, Rostamian tried to qualify his unambiguous
concession, but the trial court rightly said no, which demolished
these two claims. Rostamian’s arguments to the contrary are
unavailing. Indeed, Rostamian’s reply brief omits all effort to
respond to Delrahim’s appellate presentation on this point.
///

                               16
                        DISPOSITION
      We affirm the order dismissing the tortious interference
causes of action. We reverse as to the breach of contract, specific
performance, and unfair business practices causes of action. We
remand the case for further proceedings. The parties shall bear
their own costs on appeal.

                                           WILEY, J.

We concur:

             STRATTON, P. J.

             VIRAMONTES, J.

                                17