Court Opinion

ID: 9730285
Source: CourtListenerOpinion
Date Created: 2023-08-26 15:07:05.63462+00
Date Added: 2024-06-11T18:26:05.418002
License: Public Domain

*615WOODS (Fred), J., concurring
 I concur in the judgment contained in the lead opinion for the additional reason that the tort of bad faith denial of the existence of a contract, pursuant to Seaman’s has no applicability to this leasehold dispute between a sublessor/attorney and a sublessee/attorney.
The lead opinion contains an extensive explanation of why the landmark decision of our California Supreme Court in Seaman’s Direct Buying Service, Inc. v. Standard Oil Co. (1984) 36 Cal.3d 752 [206 Cal.Rptr. 354, 686 P.2d 1158] is inapposite where the denial of the existence of a contract occurs only in a defendant’s answer to a complaint. I concur in this conclusion. However, the lead opinion fails to discuss the issue which is perplexing the bar and bench alike, namely, does the Seaman’s case have any general viability at all, and, more importantly to the facts in the instant case, any specific viability to a leasehold dispute between lawyers, in view of the recent landmark decision by the California Supreme Court in Foley v. Interactive Data Corp. (1988) 47 Cal.3d 654 [254 Cal.Rptr. 211, 765 P.2d 373].
The Foley decision is factually distant from the record in this case since Foley involved a termination of employment dispute. However, the comments in Foley at pages 687, 688 and footnote 27 at page 688, addressing the dictum in the Seaman’s case which suggests a future expansion of the tort to employer/employee relationships cast serious doubts on the viability of the Seaman’s case. These comments by the Foley court are as follows: “Dictum in Seaman’s Direct Buying Service, Inc. v. Standard Oil Co. (1984) 36 Cal.3d 752 [206 Cal.Rptr. 354, 686 P.2d 1158] also is not helpful. There, the court focused on a standard commercial contract. We stated, ‘[w]hile the proposition that the law implies a covenant of good faith and fair dealing in all contracts is well established, the proposition advanced by Seaman’s—that breach of the covenant always gives rise to an action in tort—is not so clear.’ (Id. at p. 768.) We also observed that the propriety of a tort action for breach of the implied covenant in the insurance context was based on the ‘special relationship’ of insurer and insured, and continued, ‘No doubt there are other relationships with similar characteristics and deserving of similar legal treatment.’ (Id. at pp. 768-769.) In a footnote to the last statement, we referred to Tameny, observing that there ‘this court intimated that breach of the covenant of good faith and fair dealing in the employment relationship might give rise to tort remedies. That relationship has some of the same characteristics as the relationship between insurer and insured.’ (Id. at p. 769, fn. 6.) This allusion to the potential for extending tort remedies for breach of the implied covenant was tentative at best.’27 (Italics added.)
The court’s footnote 27 provides: “Contrary to Justice Broussard’s suggestion (see opn. by Broussard, J., post, at p. 704), our statements in Sea*616man’s were far from a definitive signal of approval for a tort remedy for breach of the covenant in employment cases. If anything, the reference highlighted the fact that this question remained to be decided by this court.”1 (Italics added.)
The Foley court, having declined to extend the Seaman’s tort of “bad faith denial of a contract” to an employer/employee relationship, appears to have severely undercut the assumption in the lead opinion that the Seaman’s tort is applicable to a sublessor/sublessee relationship dispute between members of the bar. The general viability of Seaman’s in view of Foley appears to be tenuous at best. The specific viability of Seaman’s in the context of this case is undoubtedly foreclosed.

Justice Broussard’s suggestion at page 704 of Foley is as follows: “In Seaman’s Direct Buying Service, Inc. v. Standard Oil Co. (1984) 36 Cal.3d 752 [206 Cal.Rptr. 354, 686 P.2d 1158], we concluded a tort action was available for breach of a commercial contract only when the breaching party denied in bad faith the existance of the contract. (P. 769.) We noted that tort remedies had a broader scope in insurance cases because of the special relationship between insurer and insured, and added that ‘no doubt there are other relationships with similar characteristics and deserving of similar legal treatment.’ (P. 769.) The footnote to that sentence noted that in Tameny v. Atlantic Richfield Co., supra, 27 Cal.3d 167, 179, footnote 12, ‘this court intimated that breach of the covenant of good faith and fair dealing in the employment relationship might give rise to tort remedies. That relationship has some of the same characteristics as the relationship between insurer and insured.’ (36 Cal.3d at p. 769, fn. 6.) Coming after published decisions in Cleary v. American Airlines, Inc., supra, 111 Cal.App.3d 443, Shapiro v. Wells Fargo Realty Advisors, supra, 152 Cal.App.3d 467, and Crosier v. United Parcel Service, supra, 150 Cal.App.3d 1132, this language signaled the court’s approval of a tort remedy for bad faith discharge.” (Fn. omitted.)