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CB Richard Ellis, Inc. v. Terra Nostra Consultants

California Court of Appeals, Fourth District, Third Division

October 7, 2014

CB RICHARD ELLIS, INC., Plaintiff and Appellant,
v.
TERRA NOSTRA CONSULTANTS et al., Defendants and Appellants.

[CERTIFIED FOR PARTIAL PUBLICATION [*]]

Appeal from a judgment and postjudgment orders of the Superior Court of Riverside County, No. RIC529827 Jacqueline C. Jackson, Judge. Judgment affirmed. Postjudgment order denying recovery of prejudgment interest affirmed. Postjudgment order denying recovery of attorney fees reversed.

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COUNSEL

Law Office of Brenda D.E. Yanoschik and Brenda D.E. Yanoschik for Defendants and Appellants Terra Nostra Consultants, Hanan Haskell, Israel Feit, Roy Matthew Haskin, Roy Randall Haskin, Jack DiLemme, and C&R Consultants, Inc.

Walters & Caietti and Robert M. Caietti for Defendants and Appellants Charles Ratzersdorfer, Naftali Ratzersdorfer, David Tarabulsi, Avi Gross, Moshe Gross, Zvi Tennenbaum, Yair Weill, Zvi Frankenthal, Haim Weiss, Zvi Ben Zvi, Amiram Lasker, Dov Schwartz, Tomy Deutsch, Jacob Oren, Eitan Feldbaum, and Bruce G. Keeton, as trustee of the Bruce G. Keeton Trust.

Corbett, Steelman & Specter, Ken E. Steelman, and Susan J. Ormsby for Plaintiff and Appellant.

OPINION

IKOLA, J.

Plaintiff CB Richard Ellis, Inc. (CBRE), citing a 2004 listing agreement, sought a commission after the 2005 sale of 38 acres of land in Murrieta, California (the Property). Arbitration proceedings between CBRE and the seller, Jefferson 38, LLC (Jefferson), resulted in a confirmed arbitral award in CBRE’s favor, but no monetary satisfaction for CBRE because Jefferson had no assets by the time of the arbitral award and judgment.

This action represents CBRE’s attempt to recover damages from Jefferson’s individual members. A jury trial resulted in a $354, 000 judgment in favor of CBRE.[1] Both defendants and CBRE appeal the judgment, citing alleged errors pertaining to jury instructions, the admissibility of evidence, juror misconduct, attorney fees, and prejudgment interest. We reject the parties’ contentions, except with regard to CBRE’s entitlement to attorney fees.

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FACTS

In March of 2004, CBRE and Jefferson signed an exclusive sales listing agreement for the Property. CBRE agreed to use its “best efforts to effect a sale” of the Property within the term of the listing agreement. Subject to certain exclusions, Jefferson agreed to pay a sales commission of 6 percent of the gross sales price for any sale completed within the term of the listing agreement. Utilizing its expertise and contacts, CBRE sought a buyer for the Property.

On September 16, 2004, Covenant Development, Inc. (Covenant), through its agent David Stolte of NAI Capital, transmitted a letter of intent to Jefferson to purchase the Property for $11 million. Jefferson directly responded to Stolte the next day with a counteroffer of $12 million. Before this exchange of letters, an individual representing Jefferson told Stolte that Jefferson had fired CBRE because they had not moved the sale forward fast enough.

Meanwhile, CBRE continued to market the Property. On November 10, 2004, CBRE contacted a Jefferson representative regarding additional potential buyers. Jefferson responded with a letter the next day, stating Jefferson’s position that the listing agreement expired six months from its March 8, 2004 listing date. Jefferson acknowledged a pending letter of intent identifying Walmart as a prospective buyer, a deal that would result in a commission for CBRE. But Jefferson otherwise expressed its dissatisfaction with CBRE’s performance, which (according to the letter) led Jefferson to allow the listing agreement to expire. CBRE claims the term of the listing agreement was actually one year, plus applicable extensions based on the circumstances of the sale.[2] There is no evidence CBRE took action to insert themselves into the negotiations between Jefferson and Covenant.

In a transaction between Jefferson and an entity to which Covenant assigned its interests, the sale of the Property eventually closed on July 11, 2005 for a gross sales price of $11, 800, 000. Escrow would have closed sooner but for two extensions requested and paid for by Covenant. NAI Capital ...


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