Clever Hospitality v. Patel CA2/2

Filed 4/21/16 Clever Hospitality v. Patel CA2/2

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION TWO

CLEVER HOSPITALITY, INC. et al., B264921

Plaintiffs and Appellants, (Los Angeles County Super. Ct. No. BC530043) v.

BHUPENDRAKUMAR M. PATEL et al.,

Defendants and Respondents.

APPEAL from an order of the Superior Court of Los Angeles County. Robert L. Hess, Judge. Affirmed.

The Dressler Law Group, Thomas W. Dressler, for Plaintiffs and Appellants.

Paul R. Rosenbaum for Defendants and Respondents.

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The owner of a hotel grants a prospective buyer a 60-day option to buy the hotel, during which time the buyer can conduct its due diligence and, if interested, exercise the option by depositing $150,000 into escrow. The buyer spends time and money conducting due diligence, but never makes the deposit. When the hotel owners thereafter sell the hotel to someone else, the buyer and its real estate agent sue the owners for breach of contract and related claims. The trial court dismissed the buyer’s claims. On appeal, the buyer and agent argue that the buyer’s due diligence efforts either rendered the option irrevocable or substituted for the deposit as the means of exercising the option. We disagree and affirm. FACTS AND PROCEDURAL BACKGROUND I. Facts We draw these facts from the operative Second Amended Complaint (SAC) and from the exhibits attached to it. (Crawley v. Alameda County Waste Management Authority (2015) 243 Cal.App.4th 396, 403-404 (Crawley).) In December 2012, defendants Buhpendrakumar M. Patel and Hasaben B. Patel (collectively, the Patels), as trustees of the B. Patel Family Trust dated February 13, 1991 (the Trust), signed a “Purchase and Sale Agreement” (Agreement) with plaintiff Clever Hospitality, Inc. (Clever). Under that Agreement, the Patels agreed to sell Clever the Gilbert Hotel, a hotel on Wilcox Avenue in Los Angeles, for $8,528,000. Plaintiff Kenneth Heller (Heller) was to act as the real estate broker, and was to receive a commission of $338,000 “[u]pon the Close of Escrow.” The sale was not to happen immediately. Instead, the Agreement granted Clever a 60-day “due diligence” period during which Clever could evaluate the Hotel and either agree to consummate the sale by depositing $150,000 into escrow or decide to terminate the Agreement for any reason. To facilitate Clever’s due diligence, the Agreement gave Clever the right to enter the physical premises; to inspect and review the Patels’ financial and other records for the Hotel, including “all agreements, advance bookings, leases, licenses and permits for operation of the Hotel”; and to perform at its own expense “such surveys, marketing, zoning, inspections, tests, studies and investigations as [it] deems