SAN DIEGO WATERCRAFTS, INC. v. Wells Fargo Bank

California Court of Appeal Jun 21, 2002 No. G025980, G026841Published

Before: Rylaarsdam

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Holding. The court held that a trial court errs by considering evidence submitted for the first time in a reply brief during summary judgment proceedings, and that material issues of fact existed regarding the interpretation and satisfaction of a right of first refusal.

Issues

Whether a trial court may consider evidence submitted for the first time in a moving party's reply papers on a motion for summary judgment.
Whether the lease's 'right of first refusal' provision was ambiguous and whether triable issues of fact existed regarding its satisfaction.

Disposition. reversed

Quotations verified verbatim against the opinion

“In reversing a summary judgment against the assignee of a lease, we hold that the court erred in considering evidence in support of the motion which was first submitted with the moving party's reply.”

“This is the Golden Rule of Summary Adjudication: if it is not set forth in the separate statement, it does not exist.”

“The evidence in the supplemental declaration was not in the separate statement and thus was not admissible.”

120 Cal.Rptr.2d 356 (2002) 98 Cal.App.4th 1316 SAN DIEGO WATERCRAFTS, INC., Plaintiff and Appellant,

WELLS FARGO BANK, N.A., as Trustee, etc., Defendant and Respondent.

Nos. G025980, G026841. Court of Appeal, Fourth District, Division Three.

May 31, 2002. Rehearing Granted June 21, 2002. [357] Raitt & Associates and G. Emmett Raitt, Jr., Irvine, for Plaintiff and Appellant.

Snell & Wilmer, Richard A. Derevan, Irvine, and Athena Roussos for Defendant and Respondent.

OPINION

RYLAARSDAM, J.

In reversing a summary judgment against the assignee of a lease, we hold that the court erred in considering evidence in support of the motion which was first submitted with the moving party's reply. Additionally, there are triable issues of material fact as to whether a "right of first refusal" was satisfied.

FACTS AND PROCEDURAL BACKGROUND

Defendant and respondent Wells Fargo Bank, N.A., as trustee of the Corinne Franklin trust (landlord), leased property to Brittain, Inc. (tenant), which is not a party to these proceedings. Later, tenant assigned the lease to plaintiff and appellant San Diego Watercrafts, Inc. (assignee). The lease contained a right of first refusal in favor of tenant. Assignee complains of landlord's failure to honor this right before selling the property to another entity. The trial court determined that landlord's duty to offer the property to tenant (and hence to assignee) was satisfied and thus ceased to exist when, before the assignment of the lease, tenant declined to purchase the property.

The relevant portion of the lease is entitled "Right of Negotiation to Purchase Project" and requires that before offering to sell to or accepting an offer to buy from a third party, landlord must offer the property to tenant on the same terms. It also provides that "Tenant's rights under this Section ... shall remain in effect only until such time as Tenant shall first have had the opportunity to accept Landlord's Offer under this Section ... and if Tenant does not timely and properly accept Landlord's Offer at such first opportunity, then this Section .. . shall be of no further force and effect whatsoever."

SAN DIEGO WATERCRAFTS, INC. v. Wells Fargo Bank

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OPINION

RYLAARSDAM, J.

FACTS AND PROCEDURAL BACKGROUND

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DISCUSSION

DISPOSITION

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