APPEAL from a judgment of the Superior Court of Los Angeles County, Paul Gutman, Judge. Reversed. (Los Angeles County Super. Ct. No. BC375204)
The opinion of the court was delivered by: Perluss, P. J.
CERTIFIED FOR PUBLICATION
GreenLake Capital, LLC (GreenLake) appeals from the judgment entered after the trial court granted summary judgment in favor of Bingo Investments, LLC and Centurion Financial Group, LLC (collectively Bingo) in this action brought by GreenLake to recover its fee for identifying and procuring a $150 million credit facility in favor of Bingo. Bingo contends GreenLake forfeited its right to recover the agreed-upon $3 million fee because it did not hold a California real estate broker's license. (See Bus. & Prof. Code, § 10131.)*fn1 We reverse.
Factual and Procedural Background
In November 2006 Bingo retained GreenLake to assist in identifying and raising financing to support its business activities.*fn2 According to the letter agreement between the parties, Bingo intended to create a separate affiliated investment entity with an initial debt capitalization of $150 million and was seeking financing sources to provide capital to "its new or existing entities." GreenLake was hired to "act as [Bingo's] advisor" in raising the financing, which was authorized to consist of, but not limited to, "cash, equity, quasi-equity, mezzanine financing, revolving line of credit, term loan, general credit facility, mortgage facility, warehouse credit facilities, purchase facilities, participation facilities, portfolio acquisitions or any combination thereof." GreenLake was also intended to "assist [Bingo] in analyzing, structuring, negotiating, and closing each Financing" and to "use its best efforts" to execute the financing. Bingo was to engage its own legal counsel and, if necessary, an accounting firm to comply with the due diligence requirements of any financing source.
In a paragraph entitled "Success Fees," Bingo agreed to pay GreenLake "in cash, due immediately upon closing, Success Fees equal to two percent (2.00%) of the total proceed or amount" that is "made available and/or funded" to Bingo from the financing. "If the Financing is based upon a facility or drawdown type structure, then the Success Fees will be based upon the Amount that is offered or made available by the Financing Sources to [Bingo] and not the Amount that [Bingo] elects to draw down." The parties agreed their relationship would be governed by California law. The agreement was signed by Peter T. Chang on behalf of GreenLake and David S. Bingham and Scott G. Switzer on behalf of the Bingo entities.
In January 2007 GreenLake introduced Bingo to FCC, LLC (dba First Capital Western Region (First Capital)), a potential source of financing for Bingo. Bingo and First Capital, plus another bank, West LB AG, New York Branch (West LB), executed a funding proposal letter on January 23, 2007 that contemplated extension of a $150 million credit facility to Bingo Investments II, LLC (Bingo II), a new "bankruptcy-remote," special purpose entity to be formed by the principals of Bingo. With Chang's help, Bingo negotiated a term sheet for a credit facility agreement with First Capital and West LB. Once negotiated, the term sheet was provided to the lawyers for Bingo, on the one hand, and the lenders, on the other, to draft supporting documents for the credit facility. On May 31, 2007 Bingo II entered into a credit and security agreement (CSA) with First Capital and West LB that created a credit facility in favor of Bingo II. To support the contemplated (but not yet executed) loans, Bingo II granted a security interest in its existing assets in favor of First Capital and West LB.*fn3
Once the transaction closed, GreenLake requested payment of its 2 percent fee, which, under the terms of the letter agreement, totaled $3 million. In June 2007 Bingo made partial payments totaling $300,000 but refused to make further payments, claiming no fees were due until Bingo II began to draw down on its credit facility. On August 1, 2007 GreenLake filed this lawsuit, asserting causes of action for breach of contract and unjust enrichment. Bingo unsuccessfully demurred to the complaint on the ground Chang was not a licensed real estate broker in California. (See § 10136.) On September 12, 2008, however, the trial court granted Bingo's motion for summary judgment based on the same theory.
A motion for summary judgment is properly granted only when "all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." (Code Civ. Proc., § 437c, subd. (c).) We review a grant of summary judgment de novo and decide independently whether the facts not subject to triable dispute warrant judgment for the moving party as a matter of law. (Intel Corp. v. Hamidi (2003) 30 Cal.4th 1342, 1348.) We view the evidence in the light most favorable to the opposing party, liberally construing the opposing party's evidence and strictly scrutinizing the moving party's. (O'Riordan v. Federal Kemper Life Assurance Co. (2005) 36 Cal.4th 281, 284.)
2. The Statutory Scheme Governing Licensing of Real Estate Brokers
Under the California Real Estate Law (§ 10000 et seq.), "[i]t is unlawful for any person to engage in the business, act in the capacity of, advertise or assume to act as a real estate broker or a real estate salesman within this state without first obtaining a real estate license . . . ." (§ 10130.) "The purpose of the licensing requirement is to protect the public from the perils incident to dealing with incompetent or untrustworthy real estate practitioners." (Schantz v. Ellsworth (1971) 19 Cal.App.3d 289, 292-293.) Indeed, an unlicensed person who acts as a real estate broker is subject to penal consequences. (See §§ 10139, 10185.) Moreover, section 10136 bars a person "engaged in the business or acting in the capacity of a real estate broker or a real estate salesman" from bringing or maintaining an action "for the collection of compensation for the performance of any of the acts mentioned in this article without alleging and proving he was a duly licensed real estate broker . . . at the time the alleged cause of action arose."
Section 10131 defines a "real estate broker" as one who "does or negotiates to do one or more of the following acts for another or others: [¶] (a) . . . solicits prospective sellers or purchasers [fn. omitted] of . . . or negotiates the purchase, sale or exchange of real property. . . . [¶] . . . [¶] (d) Solicits borrowers or lenders for or negotiates loans . . . or performs services for borrowers or lenders or note owners in connection with loans secured directly or collaterally by liens on real property . . . . . [¶] (e) Sells or offers to sell, buys or offers to buy, or ...