Jansing v. State of Calif. CA4/1 (2016) · DecisionDepot
Jansing v. State of Calif. CA4/1
California Court of Appeal Feb 18, 2016 No. D067278Unpublished
Filed 2/18/16 Jansing v. State of Calif. CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
NICHOLAS JANSING, D067278
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2014-0003190- CU-BT-CTL) STATE OF CALIFORNIA et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of San Diego County, Joel M.
Pressman, Judge. Affirmed.
John Silas Hopkins III and Mary E. Jansing for Plaintiff and Appellant.
Jeanne E. Scherer, Jeffrey R. Benowitz, Glenn B. Mueller, John Frederick Smith
and Mathieu G. Blackston for Defendants and Respondents.
The California Department of Transportation (Caltrans) and Caltrans's employees
Jean Mallare, Kathleen Jones, and Diana Tham (Mallare, Jones, and Tham collectively
Individual Defendants; Caltrans and Individual Defendants collectively Respondents)
successfully demurred to the first amended complaint of Nicholas Jansing doing business
as Century Sun and Solar (Jansing). Jansing appeals the ensuing judgment, contending
that the superior court erred in finding that he failed to state valid causes of action. We
conclude Jansing's contentions lack merit and affirm the judgment.
"terminated illegally on the basis of a contrived reason that was intentionally false and
deceptive."
On March 29, 2013, Caltrans published IFB 9158 soliciting bids to perform
" 'Attorney/Messenger Services' " for Caltrans's Los Angeles office. The work proposed
in IFB 9158 was similar to the work proposed in IFB 9215 and the minimum
requirements were the same except that a bidder had to provide copies of all registered
employees as well as licenses and permits at the time of bid submission. Jansing did not
submit a bid on IFB 9158. Ace Messenger was the low bidder.2
Jansing's Government Claims
On March 20, 2012, Jansing filed a government claim with the California Victim
Compensation and Government Claims Board (Board). In that claim, Jansing described
his injury as follows: "Caltrans issued an executed contract [8459] causing us to expend
1 Jansing contends that the requirement that 12 employees be "permanently registered with the County Recorder's Office" was impossible to satisfy. He points out that a process server registration is only valid for two years. The allegations of the operative complaint do not explain if he at least had 12 employees registered with the County Recorder's Office for the two-year term. In addition, we observe this requirement did not prevent Caltrans from receiving multiple bids from other bidders.
2 The operative complaint also mentions IFB 9560 for work to be performed in the Sacramento area. Jansing did not submit a bid because he could not satisfy the minimum requirements. 7
costs to prepare to service Catrans [sic] in the San Diego area. Caltrans delayed us for
more than 3 months and then abruptly canceled the contract with no explanation. We
have incurred and continue to incur costs due to this preparation." Jansing further
explained: "After bidding this work 5 times, and awarding the project, we received a
fully executed contract . . . which required us to open a new office in the San Diego area
to support Caltrans. Caltrans then canceled the contract for no reason. We beleive [sic]
this was a wrongful termination." Jansing claimed damages of $593,576.80. The Board
rejected Jansing's claim at a hearing on August 15, 2013.
On September 16, 2013, Jansing submitted a second government claim to the
Board. In that claim, Jansing contended that Caltrans improperly canceled IFB 8943 and
ultimately awarded IFB 9158 to Ace Messenger. Jansing asserted that IFB 8943 and IFB
9158 covered the same scope of work. Jansing argued that "parties within Caltrans"
manipulated requirements to "direct a bid award to a preferred contractor." Jansing
claimed damages of $783,932.50. The Board rejected this claim at a hearing on October
17, 2013.
The Lawsuit
On February 13, 2014, Jansing, proceeding in propria persona, filed a form
complaint against Respondents, among others, seeking over $5 million in damages based
on claims of intentional tort, fraud, breach of contract, and common counts. Respondents
successfully demurred to the original complaint, but the superior court allowed Jansing
leave to amend.
8
Jansing, represented by counsel, filed a first amended complaint on July 22,
2014.3 This complaint contained causes of action for breach of contract, bad faith
termination of contract, intentional interference with contract, to set aside a contract
between Ace Messenger and Caltrans under Public Contract Code section 10421,
violation of the Cartwright Act (Bus. & Prof. Code, § 16700 et seq.), two counts based on
violations of the Sherman Antitrust Act (15 U.S.C § 1 et seq.), violation of the Racketeer
Influenced and Corrupt Organizations Act (RICO) (18 U.S.C. § 1961 et seq.), failure to
supervise employees in violation of Government Code section 815.6,4 an accounting, and
attorney fees under Code of Civil Procedure section 1021.5.
Respondents successfully demurred to the first amended complaint, and the court
did not grant leave to amend. Jansing timely appealed the ensuing judgment.
DISCUSSION
Jansing contends the superior erred in sustaining Respondents' demurrer without
leave to amend. However, he does not contend that he could plead additional facts to
state valid causes of action nor does he ask us to remand this matter to the superior court
3 Jansing also named additional Caltrans employees as well as Ace Messenger as defendants. Nevertheless, Jansing did not serve these additional defendants, and they are not part of this appeal.
4 Statutory references are to the Government Code unless otherwise specified.
9
to allow him to amend his complaint. Instead, he insists that the operative complaint
stated 11 valid causes of action.5 We disagree.
I
STANDARD OF REVIEW
"On appeal from a judgment dismissing an action after sustaining a demurrer
without leave to amend, the standard of review is well settled. We give the complaint a
reasonable interpretation, reading it as a whole and its parts in their context. [Citation.]
Further, we treat the demurrer as admitting all material facts properly pleaded, but do not
assume the truth of contentions, deductions or conclusions of law. [Citations.] When a
demurrer is sustained, we determine whether the complaint states facts sufficient to
constitute a cause of action." (City of Dinuba v. County of Tulare (2007) 41 Cal.4th 859,
865 (City of Dinuba).) "When reviewing a judgment dismissing a complaint after a
successful demurrer, we assume the complaint's properly pleaded or implied factual
allegations are true . . . ." (Campbell v. Regents of University of California (2005) 35
Cal.4th 311, 320.)
5 There is a reference in the record that Jansing filed, but did not calendar, a motion for leave to amend. The superior court interpreted Jansing's request in that motion to be seeking leave to amend only if the court construed the court's previous leave to amend in a narrow manner. The court pointed out that the problem with the first amended complaint was not the court's previous grant of leave to amend, but the fact that the claims in the first amended complaint were not asserted in the government claims. The court further noted that Jansing had not provided a basis for leave to amend the first amended complaint. However, the court considered whether leave to amend should be granted in connection with the demurrer ruling. Jansing does not address his motion for leave to amend whatsoever. 10
"[W]hen [a demurrer] is sustained without leave to amend, we decide whether
there is a reasonable possibility that the defect can be cured by amendment: if it can be,
the trial court has abused its discretion and we reverse." (City of Dinuba, supra, 41
Cal.4th at p. 865.) In reviewing the sustaining of a demurrer, we review the trial court's
result for error, and not its legal reasoning. (Mendoza v. Town of Ross (2005) 128
Cal.App.4th 625, 631.)
II
FIRST CAUSE OF ACTION: BREACH OF CONTRACT
The first amended complaint's first cause of action is for breach of contract. The
essential elements of a breach of contract claim are: "(1) the contract, (2) plaintiff's
performance or excuse for nonperformance, (3) defendant's breach, and (4) the resulting
damages to plaintiff." (Reichert v. General Ins. Co. (1968) 68 Cal.2d 822, 830.) Jansing
sues Caltrans based on Contract 8459. However, as the superior court noted, Jansing
does not indicate what term of the contract Caltrans breached. Our independent review
of the operative complaint did not uncover any allegations of a breach either.
Caltrans emphasizes that Jansing admits that he did not perform any work under
Contract 8459 and was instructed by Mallare that he was not "authorized to commence
work until [he was instructed] by the Contract Manager." Jansing does not point to any
allegations in the complaint where he alleges Caltrans breached Contract 8459. Instead,
he argues that he is entitled to recover the costs of performing the contract before
Caltrans terminated it for convenience. We are not persuaded.
11
Contract 8459 clearly states that Jansing was not to begin any work until he
received a task order from the project's task manager. There is no dispute that Jansing
never received any such task order. The contract also states that all costs associated with
the project, including travel, employee pay, and subsistence, were to be included in the
price associated with the bid. Because Jansing did not perform any portion of the
contract, including any legal photocopying, legal scanning and/or imaging, subpoena and
process/manager services, it logically follows that he would not be entitled to be paid
what he would have been entitled to under an invoice for that work. In short, under the
terms of the contract, without the completion of a task order, Jansing would not be
entitled to payment for traveling, employee pay, or other related expenses.
Further, Caltrans terminated its contract with Jansing in compliance with the
contract terms. The contract provided: "Caltrans reserves the right to terminate this
Agreement without cause upon thirty (30) days written notice to the Contractor or
immediately in the event of material breach by [Jansing]." Caltrans provided Jansing
with the required 30 days written notice of termination in a letter dated January 31, 2012,
which stated that the contract would be terminated effective March 1, 2012. This gave
Jansing sufficient notice of Caltrans's intention to terminate Contract 8459 for
convenience in accordance with the contract's provisions. In the first cause of action,
Jansing does not argue Caltrans was not entitled to terminate the contract for convenience
or he did not receive proper notice of such termination. Nevertheless, he argues he is
entitled to recover all costs associated with his performance under the contract.
12
To this end, Jansing relies on several federal cases6 that he claims support his
position that Caltrans must reimburse him for his "out-of-pocket costs of uncompleted
performance." Jansing's reliance on these cases is misplaced.
Contract 8459 contained a governing law provision that provided that it was
governed by California law. None of the federal cases Jansing cites involve applying
California law to a termination of a contract for convenience. In two of the cases, the
plaintiffs were instructed to perform and had performed work under the subject contracts.
(See General Dynamics, supra, 131 S.Ct at p. 1908; Krygoski, supra, 94 F.3d at
pp. 1539-1540.) It is undisputed that Jansing received no analogous instructions here.
RAM Engineering concerned indispensable parties and the court analyzed a termination
for convenience under the Kentucky Model Procurement Code. (RAM Engineering,
supra, 127 S.W.3d at pp. 584-585.) Simply put, none of these cases prove helpful to
Jansing's position.7
Here, there was no performance under the contract. As such, Jansing is seeking to
recover his costs of preparing to perform. He has provided no authority that holds that he
6 General Dynamics Corp. v. United States (2011) 563 U.S. 478 [131 S.Ct 1900] (General Dynamics); Krygoski Construction Co. v. United States (Fed.Cir. 1996) 94 F.3d 1537 (Krygoski); RAM Engineering & Construction v. University of Louisville (Ky. 2003) 127 S.W.3d 579 (RAM Engineering).
7 Caltrans also argues that Jansing is not entitled to damages or restitution under the first cause of action pursuant to a quantum meruit theory. In his reply brief, Jansing states that Caltrans's argument "has no conceivable bearing on stating a claim under a termination for convenience clause." We interpret Jansing's position as conceding that he is not seeking damages or restitution under any quantum meruit theory for his first cause of action. As such, we do not address this issue further. 13
can recover costs of preparing to perform a contract, and we therefore deem waived any
claim that the court erred in sustaining the demurrer without leave to amend based on
Jansing's claim he is entitled to the costs of preparing to perform under the contract. (See
McComber v. Wells (1999) 72 Cal.App.4th 512, 522 (McComber) [" '[E]very brief should
contain a legal argument with citation of authorities on the points made. If none is
furnished on a particular point, the court may treat it as waived, and pass it without
consideration.' "]; Ochoa v. Pacific Gas & Electric Co. (1998) 61 Cal.App.4th 1480,
1488, fn. 3 [contention deemed waived because "Appellant did not formulate a coherent
legal argument nor did [he] cite any supporting authority"]; Colores v. Board of Trustees
(2003) 105 Cal.App.4th 1293, 1301, fn. 2 ["The dearth of true legal analysis in [his]
appellate briefs amounts to a waiver of the [contention] and we treat it as such."].)
SECOND CAUSE OF ACTION: BAD FAITH TERMINATION OF CONTRACT
In his second cause of action, Jansing seeks $7.5 million in damages for lost
profits under Contract 8459, Contract 67,8 and two bid solicitations that Caltrans
canceled. Jansing bases his claim for damages on a cause of action entitled "bad faith
termination."
The superior court sustained Caltrans's demurrer as to this cause of action on the
grounds that California law does not recognize the tort of a bad faith breach of contract
outside the insurance context in the absence of an independent duty arising from the
principles of tort law. (See Freeman & Mills, Inc. v. Belcher Oil Co. (1995) 11 Cal.4th
8 There are no allegations in the complaint that Caltrans executed Contract 67. 14
85, 102.) On appeal, Jansing claims the superior court erred because he was not alleging
a tort in the second cause of action, but instead, a breach of contract cause of action based
on the implied covenant of good faith and fair dealing. Even if we assume the second
cause of action sounds in contract, we still conclude Jansing has failed to state a valid
contract cause of action.
"[I]t is well established that a covenant of good faith and fair dealing is implicit in
every contract. [Citations.] The essence of the implied covenant is that neither party to a
contract will do anything to injure the right of the other to receive the benefits of the
contract." (Cates Construction, Inc. v. Talbot Partners (1999) 21 Cal.4th 28, 43, fn.
omitted.)
In Carma Developers (Cal.), Inc. v. Marathon Development California, Inc.
(1992) 2 Cal.4th 342 (Carma), the court9 discussed the purposes, scope, and limitations
of the implied covenant of good faith and fair dealing. The court began its analysis by
noting that "in situations where one party is invested with a discretionary power affecting
the rights of another," the covenant of good faith and fair dealing requires that "[s]uch
power . . . be exercised in good faith." (Id. at p. 372.)
After acknowledging the difficulty of defining precisely what the covenant
requires, the court noted that the covenant has both a subjective and an objective
component:
9 Carma was decided by a panel of seven justices of the Court of Appeal sitting as the Supreme Court, due to the recusal of all members of the Supreme Court. (Carma, supra, 2 Cal.4th at p. 350, fn. 1.) 15
"[I]t has been suggested the covenant has both a subjective and objective aspect—subjective good faith and objective fair dealing. A party violates the covenant if it subjectively lacks belief in the validity of its act or if its conduct is objectively unreasonable. [Citations.] In the case of a discretionary power, it has been suggested the covenant requires the party holding such power to exercise it 'for any purpose within the reasonable contemplation of the parties at the time of formation—to capture opportunities that were preserved upon entering the contract, interpreted objectively.' " (Carma, supra, 2 Cal.4th at p. 372.)
The court also explained that the duty of good faith and fair dealing is limited by
the purposes for which it is implied:
"It is universally recognized the scope of conduct prohibited by the covenant of good faith is circumscribed by the purposes and express terms of the contract. [Citations.] As explained in Foley[v. Interactive Data Corp. (1988) 47 Cal.3d 654, 668], under traditional contract principles, the implied covenant of good faith is read into contracts 'in order to protect the express covenants or promises of the contract, not to protect some general public policy interest not directly tied to the contract's purpose.' [Citation.]" (Carma, supra, 2 Cal.4th at p. 373.)
Thus, a party may breach the covenant by engaging in conduct, "[that,] though not
prohibited [by the parties' contract], is nevertheless contrary to the contract's purposes
and the parties' legitimate expectations." (Carma, supra, 2 Cal.4th at p. 373.)
Here, Contract 8459 contained a provision that plainly and unambiguously
conferred upon Caltrans the unqualified right to terminate the contract "without cause
upon thirty (30) days written notice[.]" This is what Caltrans did. Nevertheless, Jansing
insists Caltrans exercised its right under the contract in "bad faith" because the letter
terminating the contract did not give a reason for the termination, Jansing unsuccessfully
tried to discover the reason for the termination, and there was no change in
16
circumstances. Jansing further argues that he had not been cleared to perform work
under the contract to "test his capability" so apparently he is unsure why a Caltrans
representative informed him that his company was " 'not the right company.' "
Jansing does not explain how any of these allegations support his conclusion that
Caltrans acted in bad faith to terminate Contract 8459. The contract does not require
Caltrans to provide the reason it terminated the contract. It merely calls for Caltrans to
provide 30-day written notice of its election to terminate. Jansing concedes that he
received adequate written notice. He simply disagrees with Caltrans terminating Contract
8459. This disagreement does not support his claim that Caltrans acted in bad faith.
Jansing also attempts to expand the implied covenant of good faith and fair
dealing beyond an executed contract to apply to solicitations for bids, but he does not
provide any authority to support this expansion. As such, we deem this argument
waived. (See McComber, supra, 72 Cal.App.4th at p. 522.)
Further, even if Jansing had not waived this argument, we observe that his
allegations fall short of alleging facts to show Caltrans acted in bad faith. He merely
disagrees with Caltrans's decision to cancel the subject solicitations to bid and claims that
the reasons Caltrans provided for cancelling them were insufficient. Again, Jansing's
disagreement with Caltrans does not give rise to his claim that Caltrans acted in bad faith.
III
CAUSES OF ACTION 3 THROUGH 9
Jansing next argues that the superior court erred in sustaining the demurrer as to
causes of action 3 through 9. Jansing contends the court wrongly concluded these causes
17
of action did not conform to the matters set forth in his two government claims.
Respondents counter that the allegations in the first amended complaint vary significantly
from the matters in the two government claims and, thus, the court properly sustained the
demurrer. Respondents have the better argument.
Section 900 et seq., part of the Tort Claims Act, "prescribes the manner in which
public entities may be sued." (Chalmers v. County of Los Angeles (1985) 175
Cal.App.3d 461, 464.) Section 945.4 provides that " 'no suit for money or damages may
be brought against a public entity on a cause of action for which a claim is required to be
presented in accordance with . . . Section 910 . . . until a written claim therefor has been
presented to the public entity and has been acted upon by the [public entity's] board, or
has been deemed to have been rejected by the board . . . .' Section 910, in turn, requires
that the claim state the 'date, place, and other circumstances of the occurrence or
transaction which gave rise to the claim asserted' and provide '[a] general description of
the . . . injury, damage or loss incurred so far as it may be known at the time of
presentation of the claim.' " (Stockett v. Association of Cal. Water Agencies Joint Powers
"The purpose of these statutes is 'to provide the public entity sufficient information
to enable it to adequately investigate claims and to settle them, if appropriate, without the
expense of litigation.' [Citation.] Consequently, a claim need not contain the detail and
specificity required of a pleading, but need only 'fairly describe what [the] entity is
alleged to have done.' [Citations.] As the purpose of the claim is to give the government
entity notice sufficient for it to investigate and evaluate the claim, not to eliminate
18
meritorious actions [citation], the claims statute 'should not be applied to snare the
unwary where its purpose has been satisfied' [citation]." (Stockett, supra, 34 Cal.4th at
p. 446.)
"A claim relating to a cause of action . . . for injury to person . . . shall be
presented . . . not later than six months after the accrual of the cause of action. . . ."
(§ 911.2, subd. (a).) "The board shall act on a claim . . . within 45 days after the claim
has been presented. . . ." (§ 912.4, subd. (a).) "If the board fails or refuses to act on a
claim within the time prescribed by this section, the claim shall be deemed to have been
rejected by the board on the last day of the period within which the board was required to
act upon the claim." (Id., subd. (c).) If written notice of rejection of the claim is sent, the
lawsuit against the public entity must be commenced "not later than six months after the
date such notice is personally delivered or deposited in the mail." (§ 945.6, subd. (a)(1).)
"If the claim is rejected and the plaintiff ultimately files a complaint against the
public entity, the facts underlying each cause of action in the complaint must have been
fairly reflected in a timely claim. [Citation.] '[E]ven if the claim were timely, the
complaint is vulnerable to a demurrer if it alleges a factual basis for recovery which is not
fairly reflected in the written claim.' " (Stockett, supra, 34 Cal.4th at p. 447.) "The claim,
however, need not specify each particular act or omission later proven to have caused the
injury. [Citation.] A complaint's fuller exposition of the factual basis beyond that given
in the claim is not fatal, so long as the complaint is not based on an 'entirely different set
of facts.' " (Ibid., citing Stevenson v. San Francisco Housing Authority (1994) 24
Cal.App.4th 269, 278.) "Only where there has been a 'complete shift of allegations,
19
usually involving an effort to premise civil liability on acts or omissions committed at
different times or by different persons than those described in the claim' have courts
generally found the complaint barred. [Citation.] Where the complaint merely elaborates
or adds further detail to a claim, but is predicated on the same fundamental actions or
failures to act by the defendants, courts have generally found the claim fairly reflects the
facts pled in the complaint." (Stockett, at p. 447.) " ' "If a plaintiff relies on more than
one theory of recovery against the [governmental agency], each cause of action must
have been reflected in a timely claim. In addition, the factual circumstances set forth in
the written claim must correspond with the facts alleged in the complaint . . . ." ' " (Fall
River Joint Unified School Dist. v. Superior Court (1988) 206 Cal.App.3d 431, 434 (Fall
River).)
Here, Jansing submitted two government claims. The first claim only concerned
Caltrans's termination of Contract 8459. In that claim, Jansing states that Caltrans
delayed Jansing for three months and "abruptly canceled the contract with no
explanation." He claimed the termination was wrongful. Jansing used six sentences in
the claim to describe Caltrans's wrongful conduct and his injury.
In the second claim, Jansing identifies four IFB's issued by Caltrans (IFB 9215,
IFB 8787, IFB 8943, and IFB 9158). The letter entitled "Basis of Claim" attached to the
second claim outlines a bidding process in which Jansing submitted a bid in response to
Caltrans's IFB's. The letter alleges that Caltrans canceled the IFB's on a number of
occasions due to internal errors in the solicitation process and due to a change in the
20
bidding requirements. Ultimately, the letter alleges Caltrans awarded a contract to an
alternative bidder.
Based on this foundation, Jansing asserted in the second claim that Caltrans
directed a bid award to a specific contractor for one contract. Although Jansing insisted
that Caltrans's employees committed wrongful acts, he did not name any Caltrans
employees or describe their wrongful acts.
In comparison to the two government claims, the first amended complaint consists
of 351 paragraphs over 82 pages that includes 11 causes of action. In addition, almost 80
additional pages of exhibits are attached to the first amended complaint. The complaint
references and discusses over 10 IFB's as well as various contracts that Caltrans allegedly
entered with other parties.
Jansing was required to provide Caltrans with notice sufficient for it to investigate
and evaluate causes of action 3 through 9 as contained in his first amended complaint.
" ' "If a plaintiff relies on more than one theory of recovery against the [governmental
agency], each cause of action must have been reflected in a timely claim." ' " (Fall River,
supra, 206 Cal.App.3d at p. 434.) " ' "In addition, the factual circumstances set forth in
the written claim must correspond with the facts alleged in the complaint . . . ." ' " (Ibid.)
In Fall River, the appellate court issued a writ of mandate directing the trial court
to grant the defendant's motion for judgment on the pleadings (Fall River, supra, 206
Cal.App.3d at p. 437) on the ground that the "plaintiff failed to file a Government Code
tort claim describing the facts giving rise to the alleged liability" (id. at p. 433). The
plaintiff's claim stated he was hurt when a school door closed with force and slammed his
21
head against the door frame due to the door's " 'dangerous and defective condition.' " (Id.
at p. 434.) A cause of action in the plaintiff's complaint sought "damages on the theory
that school district personnel negligently failed to supervise students who were engaged
in 'dangerous horse-play . . . .' " (Ibid.) The Court of Appeal found this cause of action
"patently attempt[ed] to premise liability on an entirely different factual basis than what
was set forth in the tort claim," creating a variance fatal to the plaintiff's pleading. (Id. at
p. 435.) Even a cursory review of Jansing's claims shows that they possess the same fatal
flaw as the plaintiff's claims in Fall River.
Jansing's third cause of action was for intentional interference with contract.
" 'The elements which a plaintiff must plead to state the cause of action for intentional
interference with contractual relations are (1) a valid contract between plaintiff and a
third party; (2) defendant's knowledge of this contract; (3) defendant's intentional acts
designed to induce a breach or disruption of the contractual relationship; (4) actual breach
or disruption of the contractual relationship; and (5) resulting damage.' " (Quelimane Co.
v. Stewart Title Guaranty Co. (1998) 19 Cal.4th 26, 55.) In the operative complaint,
Jansing only alleged the existence of one contract, Contract 8459. Jansing's first
government claim focuses on Contract 8459, but in that claim, Jansing only contends that
Caltrans wrongfully terminated the contract. Jansing did not state that any other party
interfered with Contract 8459. Further, in his second claim he does not even mention
Contract 8459. Thus, the factual circumstances set forth in Jansing's written claims do
not correspond with the facts alleged in the complaint and Jansing's second cause of
action necessarily fails. (See Fall River, supra, 206 Cal.App.3d at pp. 434-435.)
22
In his opening brief, Jansing argues that his third cause of action is really one for
intentional interference with prospective economic advantage.10 He contends that
because he was the low bidder on some bids, he had an economic relationship with
Caltrans and various Caltrans employees interfered with it. Even if we were to assume
that Jansing's claim is one for intentional interference with prospective economic
advantage, this claim fares no better than the one he actually pleads in the operative
complaint. It simply is not based on the same facts set forth in either of Jansing's
government claims, and thus fails. (See Fall River, supra, 206 Cal.App.3d at p. 434.)
Further, Jansing's claim for intentional interference with prospective economic
advantage also fails because Jansing did not allege any of the Individual Defendants'
interfering conduct was wrongful by some measure beyond the interference itself. (See
Della Penna v. Toyota Motor Sales, U.S.A., Inc. (1995) 11 Cal.4th 376, 392-393.) Nor
does Jansing claim that he could do so.
Jansing's fourth cause of action is to set aside a contract entered into between
Caltrans and Ace Messenger under Public Contract Code section 10421. Like Jansing's
10 The elements of a claim of interference with prospective economic advantage are similar to a claim for intentional interference with contract except that the former does not require the existence of a contract, but instead an economic relationship between the plaintiff and a third party. (Winchester Mystery House, LLC v. Global Asylum, Inc. (2012) 210 Cal.App.4th 579, 596.) In addition, a plaintiff stating a claim for interference with prospective economic advantage must allege an additional element. "The tort of intentional interference with prospective economic advantage is not intended to punish individuals or commercial entities for their choice of commercial relationships or their pursuit of commercial objectives, unless their interference amounts to independently actionable conduct." (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134, 1158-1159.) 23
third cause of action, there is nothing in either of the government claims that asks for a
contract entered into between Caltrans and Ace Messenger to be declared void.11
Indeed, Public Contract Code section 10421 is not mentioned whatsoever in either of
Jansing's two government claims. Further, the relief Jansing seeks in his two government
claims is damages ($593,576.80 for the first claim; $783,932.50 for the second claim).
Thus, the fourth cause of action fails because nothing in Jansing's government claims
alerted Caltrans that Jansing was seeking to set aside a contract.
Moreover, Jansing's claim to set aside a contract under Public Contract Code
section 10421 fails for the additional reason that it has not been properly pled. In the
operative complaint, Jansing alleges that Caltrans's contract with Ace Messenger is void
under Public Contract Code sections 10420 and 10421. But he does not allege why.
Public Contract Code section 10420 states "Every contract or other transaction entered in
violation of any provision of this chapter is void, unless the violation is technical or
nonsubstantive." A plaintiff can seek to void a contract under that section, but there has
to be another violation of the Public Contract Code. Likewise, section 1042112 provides
11 Apparently in a protest, Jansing previously requested that a contract between Ace Messenger and Caltrans be canceled and the bid be awarded to him. However, in his second government claim, Jansing only requested damages.
12 Public Contract Code section 10421 provides: "The state, or any person acting on behalf of the state, may bring a civil action seeking a determination by the Superior Court that a contract or other transaction has been entered in violation of any provision of this chapter. If the court finds substantial evidence of such a violation, it may issue a temporary injunction to prevent any further dealings upon the contract or other transaction, pending a final determination on the merits of the case. If the action results in a final determination that the contract or other transaction has been entered in violation 24
a mechanism by which a party can bring a civil action seeking a determination that a
contract has been entered in violation of some other provision of the Public Contract
Code. However, both Public Contract Code sections 10420 and 10421 require a violation
of another provision of that code. Here, Jansing has not pointed us to any such allegation
in the operative complaint. Nor has he argued he could plead one. As such, this claim
fails for this additional reason as well.
The fifth cause of action purports to state a claim against Respondents for
violating the Cartwright Act (Bus. & Prof. Code, § 16700 et seq.). Causes of action 6 and
7 attempt to allege claims for violations of the Sherman Antitrust Act (15 U.S.C § 1 et
seq.). The Cartwright Act and the Sherman Act were enacted to promote free market
competition and to prevent conspiracies or agreements in restraint or monopolization of
trade. (Exxon Corp. v. Superior Court (1997) 51 Cal.App.4th 1672, 1680.) The
allegations contained in both of Jansing's government claims fall woefully short of
notifying Caltrans that Jansing believed it had violated state and federal antitrust laws.
Jansing's first government claim concerned the alleged wrongful termination of a contract
between Jansing and Caltrans. Jansing's second government claim concerned the award
of a single contract to Ace Messenger as well as allegations that Caltrans changed the
requirements for the bids that prevented Jansing from bidding to be awarded the contract.
There is not even a hint in the second government claim that Jansing was subsequently
of this chapter, it shall be void, and the state or person bringing the action shall be awarded costs and attorney[] fees. This section shall not be construed to permit an award of costs and attorney fees to the person or entity contracting or otherwise transacting with the state." 25
going to allege that Caltrans and its employees were engaging in activities to restrain or
monopolize trade on the scale required under state and federal antitrust laws and, thus,
these causes of action fail. (See Fall River, supra, 206 Cal.App.3d at p. 434.) The
superior court did not err in sustaining the demurrer as to causes of action 5 through 7.13
In his eighth cause of action, Jansing alleges Respondents violated RICO. "RICO
was intended to prevent the takeover of a legitimate business enterprise by racketeers.
RICO requires conduct of an enterprise engaged in or affecting interstate commerce
through a pattern of racketeering activity that causes injury to the business or property of
plaintiff. [Citation.] In order to allege a civil RICO claim, a party must allege facts
sufficient to show a pattern of racketeering activity sufficient to bring the claim within
the provisions of [title] 18 United States Code section 1961(1) which defines racketeering
as certain specifically enumerated state felonies and violations of specific sections of the
United States Criminal Code." (Globe Internat., Inc. v. Superior Court (1992) 9
Cal.App.4th 393, 398.)
Much like the shortcomings of Jansing's antitrust claims, his RICO claim also
relies on allegations that are far beyond those set forth in Jansing's government claims.
13 Because we conclude that the allegations in the operative complaint as to causes of action 5 through 7 are not sufficiently based on Jansing's government claims, we do not reach the issue of whether Caltrans can be sued under the Cartwright Act. (See, e.g., People ex rel. Freitas v. City and County of San Francisco (1979) 92 Cal.App.3d 913, 921.) As to Jansing's claims under the Sherman Antitrust Act, we note that Congress vested in the federal courts exclusive jurisdiction over federal antitrust laws (15 U.S.C. §§ 1, 2), and state courts have no jurisdiction to construe or enforce the federal antitrust laws (15 U.S.C. § 15; Union Oil Co. v. Chandler (1970) 4 Cal.App.3d 716, 726; Classen v. Weller (1983) 145 Cal.App.3d 27, 34, fn. 2). Therefore, Jansing's sixth and seventh causes of action could not stand in any event. 26
There are simply no facts in those claims that put Caltrans on notice that Jansing would
bring a RICO claim. Jansing glosses over this deficiency by claiming that his
government claims showed a pattern of bid rigging. Not so. Further, Jansing argues his
RICO claim is supported by allegations in the operative complaint. This argument misses
the point. Simply put, the government claims Jansing submitted here do not provide even
an intimation that he believed Caltrans had violated RICO. Jansing's eighth cause of
action therefore fails. (See Fall River, supra, 206 Cal.App.3d at p. 434.)
Following a familiar pattern, Jansing's ninth cause of action for failing to supervise
employees under section 815.6 also has no basis in Jansing's government claims. Jansing
has not provided any citation to an allegation in his government claim that put Caltrans
on notice that he believed it was not properly supervising its employees. This claim
therefore fails as well.
IV
TENTH AND ELEVENTH CAUSES OF ACTION
Jansing's 10th cause of action is for an accounting. Specifically, he requests an
accounting of "the profits of . . . Ace Messenger . . . from its contracts
with . . . Caltrans . . . ."
At the outset, we observe there is a split under California law whether accounting
is a cause of action or a remedy. (See Batt v. City and County of San Francisco (2007)
155 Cal.App.4th 65, 82 [accounting is not an independent cause of action but a remedy];
Fleet v. Bank of America N.A. (2014) 229 Cal.App.4th 1403, 1413 (Fleet) [accounting is
a cause of action].) We need not weigh in on this split here.
27
Because Jansing has not alleged any valid causes of action, he is not entitled to an
accounting remedy. (See Janis v. California State Lottery Com. (1998) 68 Cal.App.4th
824, 833-834.)
If we assume accounting is a cause of action then such a claim involves a showing
of a relationship between the plaintiff and the defendant, such as a fiduciary relationship,
that requires an accounting or a showing that the accounts are so complicated they cannot
be determined through an ordinary action at law. (Fleet, supra, 229 Cal.App.4th at
p. 1413.) Here, Jansing is not seeking an accounting based on any relationship between
him and Caltrans. Instead, he is asking for an accounting for Ace Messenger based on its
contracts with Caltrans. Jansing has not provided any authority that would allow him
such an accounting. In addition, to the extent accounting is a cause of action, Jansing's
claim is not based on either of his government claims and fails for this reason as well.
Jansing's final "cause of action" is for attorney fees under Code of Civil Procedure
section 1021.5. On appeal, Jansing concedes that this is not a cause of action and is a
request for an award of attorney fees that is derivative of his other claims. Because none
of Jansing's claims survive, his request for attorney fees under Code of Civil Procedure
section 1021.5 necessarily fails as well.
28
DISPOSITION
The judgment is affirmed. Respondents are awarded their costs on appeal.
HUFFMAN, Acting P. J.
WE CONCUR:
O'ROURKE, J.
IRION, J.
29
AI Brief
AI-generated · verify before citing
Holding. The court affirmed the judgment of dismissal, holding that the plaintiff failed to state valid causes of action for breach of contract and bad faith termination because the defendant exercised its express contractual right to terminate for convenience and the plaintiff failed to allege facts supporting a breach of the implied covenant of good faith and fair dealing.
Issues
Whether the trial court erred in sustaining a demurrer to the first amended complaint without leave to amend.
Whether the plaintiff stated a valid cause of action for breach of contract regarding a contract containing a termination for convenience clause.
Whether the plaintiff stated a valid cause of action for bad faith termination of contract.
Disposition. Affirmed.
Quotations verified verbatim against the opinion
“We conclude Jansing's contentions lack merit and affirm the judgment.”
“Contract 8459 clearly states that Jansing was not to begin any work until he received a task order from the project's task manager. There is no dispute that Jansing never received any such task order.”
“Contract 8459 contained a provision that plainly and unambiguously conferred upon Caltrans the unqualified right to terminate the contract "without cause upon thirty (30) days written notice[.]" This is what Caltrans did.”