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The People Ex Rel. v. Timothy N. Lam

December 3, 2010

THE PEOPLE EX REL.
THE DEPARTMENT OF TRANSPORTATION, PLAINTIFF AND RESPONDENT,
v.
TIMOTHY N. LAM DEFENDANT AND APPELLANT.



Appeal from a judgment of the Superior Court of Orange County, Nancy Wieben Stock, Judge. Affirmed. (Super. Ct. No. 06CC04412)

The opinion of the court was delivered by: Rylaarsdam, Acting P. J.

P. ex rel. DOT v. Lam

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NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

OPINION

Defendant Timothy N. Lam appeals from the judgment denying his claim for loss of business goodwill after his property was taken by plaintiff the Department of Transportation in a condemnation action. He contends the trial court erred in determining he failed to meet the threshold requirements. Finding no error, we affirm the judgment.

FACTS

Plaintiff condemned a shopping center where defendant and his wife owned and operated a furniture store. Before defendant signed the lease in October 2001, he knew the center might be condemned.

In January 2005, plaintiff's representatives notified tenants the center was being condemned and defendant began searching for a relocation site. With plaintiff's assistance, defendant visited numerous possible new locations within Orange County but was unable to relocate or reopen the business. Although he had two leases drawn up, he did not sign either one because he did not have the money to pay the first and last months' rent, having "already invested everything . . . into [his] stores . . . with opening up all of those manufacturing and furniture lines . . . and . . . the rent was a lot more than what we were paying." The rent would have gone from the approximately $4,000 he was paying to $12,000 or $13,000. His financial circumstances did not allow him to relocate.

Despite multiple notices advising him to leave the premises before July 2006, defendant did not do so until September 2006 and only after he received a 3-day notice to vacate. He had waited "until the very last minute" because he was "cash-strapped" and had not heard back from plaintiff about what it could do for him with regard to the two leases that had been drawn up. He declined the option of having plaintiff move his property and instead had family and friends move his inventory to storage, where it stayed for over a year with plaintiff paying the storage costs. That same month, defendant opened and incorporated another business to represent manufacturers and supply U.S. hotels with furniture imported from China. For his new company, defendant had business partners, advertised it on the Internet, and had several business Internet domains.

The trial court denied defendant's claim for loss of business goodwill compensation, finding defendant had not produced evidence to support the first two elements under Code of Civil Procedure section 1263.510, subdivisions (1) and (2) (all further statutory references are to this code) "inasmuch as the loss was not caused by the taking" or plaintiff's acts or conduct but "by superseding circumstances of the defendant's own personal and business conduct when faced with opportunities to successfully relocate the business." Despite two suitable relocation sites, defendant did not sign the already drawn-up leases based on his "misguided notion . . . [plaintiff] would be paying the first and last months' rental which the business itself could not afford to pay." Although defendant testified he was frustrated waiting for help with that, he failed to show plaintiff had any legal obligation or misled him into believing it would pay the rental deposit. Defendant's "decision ultimately cost [him his] retail platform and placed [him] in the unfortunate position of having to liquidate [his] inventory, something that could have been done perhaps in a more favorable climate if [he] had conducted the inventory reduction from [his] own showroom as part of a planned business closeout." The court concluded, "If there was goodwill in the business, it was lost when the business closed down and never reopened as a retail showroom."

DISCUSSION

1. Standard of ...


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