California Court of Appeals, Fourth District, Second Division
THE H.N. AND FRANCES C. BERGER FOUNDATION, Plaintiff and Appellant,
JUAN C. PEREZ, as Director, etc. et. al., Defendants and Respondents.
Pub. Order 7/23/13 (See End of opn.)
APPEAL from the Superior Court of Riverside County, No. INC 10006073 Randall Donald White, Judge.
Barton, Klugman & Oetting, and Ronald R. St. John, for Plaintiff and Appellant.
Watt, Tieder, Hoffar & Fitzgerald, Robert C. Niesley, Donna R. Tobar, and Christopher M. Bunge, for Defendants and Respondents.
HOLLENHORST, Acting P. J.
Plaintiff and appellant The H.N. and Frances C. Berger Foundation appeals the judgment of dismissal following the order granting the demurrer to its second amended complaint for breach of contract, declaratory relief and petition for writ of mandate to compel defendants and respondents Juan C. Perez, as Director of the County of Riverside Transportation Department (RTD), County of Riverside (Riverside), and Travelers Casualty and Surety Company of America (Travelers) to enforce the terms of the Varner Road Improvements Agreements and Faithful Performance Bonds. Finding no errors, we affirm.
I. PROCEDURAL BACKGROUND AND FACTS
This action concerns real property located in the Palm Desert area of Riverside on Varner Road. Of the relevant 10 lots, eight were owned by Desert Gold Ventures, LLC (DGV), six of which were subject to a deed of trust in favor of plaintiff, and two were owned by plaintiff. On November 6, 2006, improvement agreements and securities were approved by RTD and Riverside. These agreements and securities concerned the construction of a road with drainage, water system, lighting, signing, and grading improvements and were referred to as the Varner Road Improvement Agreements (Agreements). On March 13, 2007, the Agreements were modified by an extension of time and substitution of security, whereby Faithful Performance Bonds (Bonds) were executed by Travelers. The Bonds issued by Travelers were to guarantee DGV’s construction of certain improvements identified in the Agreements. Between 2006 and 2008, DGV completed some of the work under the Agreements but defaulted by failing to fully complete the work insured by the Bonds. In 2009, DGV defaulted on its obligations to plaintiff under the Deeds of Trust, and plaintiff acquired the six lots through foreclosure. On or about December 29, 2010, Riverside and Travelers entered into an agreement whereby some of the improvements in the Agreements were excluded from the Bonds but others were not, and thus, Travelers was required to complete those improvements.
Plaintiff initiated this action on July 2, 2010, against RTD as a petition for writ of mandate to compel RTD to “publish for bidding the plans for the completion of the Varner Road Improvements Agreements and to further take such steps as are necessary to assure the completion of the Varner Road Improvements Agreements.” Following the granting of a demurrer, plaintiff filed a first amended petition for writ of mandate and complaint for breach of contract on December 1, 2010, adding DGV, Travelers, and Richard R. Oliphant as additional defendants and including a breach of contract claim against these additional defendants. Defendants demurred, and the trial court found that plaintiff failed to show that Travelers was a party to the Agreements between DGV and Riverside, and that plaintiff was unequivocally an intended third party beneficiary of the Bonds issued by Travelers. Plaintiff was granted leave to amend.
Plaintiff’s second amended complaint for breach of contract, petition for writ of mandate and declaratory relief was filed on March 18, 2011. Defendants again demurred. As to the breach of contract claim, they argued that plaintiff was neither a party to nor a third party beneficiary of the Agreements. Regarding the petition for writ of mandate, they argued that plaintiff failed to allege that RTD and Riverside had a ministerial duty to enforce the Agreements, nor did plaintiff have standing to enforce the Agreements. Finally, as to the declaratory relief claim, they argued that plaintiff had no standing to challenge their contractual relations with Travelers. The trial court agreed with defendants, finding that plaintiff was not a party to the Agreements or the Bonds between DGV and Travelers, respectively, and Riverside; that “Mandamus will not lie to enforce a purely contractual obligation, ” and that “Plaintiff has no legally cognizable theory on which to seek declaratory relief.” Judgment of dismissal was entered on October 13, 2011. Plaintiff appeals.
II. STANDARD OF REVIEW
We review de novo the trial court’s rulings sustaining a defendant’s demurrer without leave to amend. (Schauer v. Mandarin Gems of Cal., Inc. (2005) 125 Cal.App.4th 949, 955 (Schauer).) “‘[W]e give the complaint a reasonable interpretation, and treat the demurrer as admitting all material facts properly pleaded, but not the truth of contentions, deductions or conclusions of law. We reverse if the plaintiff has stated a cause of action under any legal theory. [Citation.]’ [Citation.]” (Id. at p. 955.)
III. THIRD PARTY BENEFICIARY
According to plaintiff, the trial court erred in granting the demurrer without leave to amend because plaintiff had standing as a third party beneficiary to the Agreements and Bonds. “We begin with the rule that ‘[e]very action must be prosecuted in the name of the real party in interest, except as otherwise provided by statute.’ [Citation.] Where the complaint shows the plaintiff does not possess the substantive right or standing to prosecute the action, ‘it is vulnerable to a general demurrer on the ground that it fails to state a cause of action.’ [Citations.]” (Schauer, supra, 125 Cal.App.4th at p. 955.) Here, the trial ...