First United v. General Motors CA4/1 (2013) · DecisionDepot
First United v. General Motors CA4/1
California Court of Appeal Apr 9, 2013 No. D061563Unpublished
Filed 4/9/13 First United v. General Motors CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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
FIRST UNITED, INC., D061563
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2010-00072077- CU-BC-EC) GENERAL MOTORS LLC,
Defendant and Respondent.
APPEAL from a judgment of the Superior Court of San Diego County, Joel
R.Wohlfeil, Judge. Affirmed.
Plaintiff and appellant First United, Inc., doing business as De La Fuente Cadillac
(at times, De La Fuente), sued defendant and respondent General Motors LLC (GM) for
breach of contract and other claims, alleging in part that GM breached certain agreements
by unreasonably rejecting plaintiff's proposed purchase of franchise assets and relocation
of a Poway Buick-GMC car dealership to plaintiff's El Cajon facility. The trial court
granted GM's motion for summary judgment on grounds, inter alia, plaintiff did not raise
triable issues of material fact as to whether GM breached its contracts with De La Fuente,
made actionable misrepresentations or omissions, and tortiously interfered with plaintiff's
contract rights or prospective economic advantage. On appeal, plaintiff contends it raised
triable issues of material fact as to all of its causes of action except its claim for unfair
business practices, which it concedes the court properly summarily adjudicated in GM's
favor. We affirm the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff operates a Cadillac dealership on East Main Street in El Cajon, and is
certified by GM as a Cadillac motor vehicle dealer under a GM dealer sales and service
agreement. Grenier Poway, Inc. (Grenier) formerly operated a Buick and GMC
dealership in Poway, California under the terms of a GM dealer sales and service
agreement. GM's dealer sales and service agreements incorporate standard provisions
that address, among other things, "Dealer Network Planning," "Area[s] of Primary
Responsibility" or APRs,1 and changes in the location or use of the dealer premises.
In June 2009, GM's predecessor filed for bankruptcy protection and eventually
sold its assets to GM free and clear of claims, liens and causes of action. GM assumed all
continuing dealer agreements, as well as "wind-down" agreements it had offered to
certain dealerships, including plaintiff, who had declined to sign it. Thereafter, in August
1 Plaintiff's marketing expert, Edward Stockton, explained that an APR is a dealership's contractually assigned territory, and that some APRs are divided into subsections called "Areas of Geographic Sales and Service Advantage." 2
2009, GM and plaintiff entered into a dealer sales and service agreement (the De La
Fuente dealer agreement) identical to their prior agreement.
In February 2010, plaintiff and Grenier entered into an asset purchase agreement
under which plaintiff agreed to purchase certain assets of Grenier's Poway Buick-GMC
dealership (the proposed relocation agreement). Plaintiff's obligations under the
agreement were conditioned in part on GM's approval of plaintiff's operation of a GMC-
Buick dealership at its East Main Street location, and plaintiff understood the proposed
purchase and relocation of assets from Poway to El Cajon would have to be approved by
GM. In May 2010, plaintiff submitted a "change request" to GM for its proposed line
asset purchase from Grenier, indicating it would conduct the operations at plaintiff's El
Cajon location. Plaintiff's application was accompanied by GM's Dealer Bulletin No. 04-
09, containing "policies applicable to all proposed ownership/management changes."
In a letter dated August 9, 2010, GM declined to approve the proposed relocation.
Though it determined plaintiff was qualified under the criteria for change in dealer
ownership, GM nevertheless informed plaintiff that "GM's network planning for Buick
and GMC in Poway is to maintain representation." GM pointed out "[t]he proposed
Relocation is approximately twelve (12) miles away in El Cajon, CA and having Buick-
GMC representation in El Cajon is inconsistent with the GM's dealer network planning
for both the Poway and El Cajon communities as well as the San Diego Multiple Dealer
Area . . . ." Reciting the first paragraph of article 4.1 of the De La Fuente dealer
3
agreement as to dealer network planning,2 GM stated, "GM has determined that the
proposed Relocation is inconsistent with its planning as set forth above . . . ."
Grenier eventually terminated its dealer agreement with GM. GM approved the
application of a former dealer as the replacement Buick-GMC dealer at the Poway
location.
In November 2010, plaintiff sued GM for breach of contract, breach of the implied
covenant of good faith and fair dealing, negligent and intentional misrepresentation,
interference with contract/economic advantage, and unfair business practices.3 Plaintiff
alleged GM's stated reason for rejecting the asset purchase and relocation was
unreasonable, arbitrary, pretexual, and contrary to the terms and intent of the dealer
2 Article 4.1 of GM's standard provisions provides: "Because [GM] distributes it's [sic] Products through a network of authorized dealers operating from approved locations, those dealers must be appropriate in number, located properly, and have proper facilities to represent and service [GM] Products competitively and to permit each dealer the opportunity to achieve a reasonable return on investment if it fulfills its obligations under its Dealer Agreement. Through such a dealer network, [GM] can maximize the convenience of customers in purchasing Products and having them serviced. As a result, customers, dealers, and [GM] all benefit. [¶] To maximize the effectiveness of its dealer network, [GM] agrees to monitor marketing conditions and strive, to the extent practicable, to have dealers appropriate in number, size and location to achieve the objectives stated above. Such marketing conditions include [GM] sales and registration performance, present and future demographic and economic considerations, competitive dealer networks, the ability of [GM] existing dealers to achieve the objectives stated above, the opportunities available to existing dealers, the alignment of Line-Makes, [GM] dealer network plan, and other appropriate circumstances." We note, as does plaintiff, that the dealer agreement provides it is "governed by the laws of the State of Michigan." Neither party raised a choice of law issue below, nor have they before us. We agree the parties mutually waived or abandoned in this appeal any arguments concerning choice of law or right to enforce the choice of law provision.
3 Plaintiff also sued Grenier, but the record does not indicate that Grenier moved for summary judgment. Accordingly, we do not address the causes of action against Grenier. 4
agreements, and that at the time, GM had no expectation that any GM dealer would
continue to operate in Poway or any basis for its position that the proposed relocation was
contrary to the reasonable goals of dealer network planning. Plaintiff alleged GM
breached the De La Fuente dealer agreement and other agreements, as well as the implied
covenant of good faith and fair dealing, by unreasonably refusing to approve the
proposed relocation agreement, failing to sufficiently consider promotion and
preservation of competition and customer satisfaction, and refusing its application on
"false and pretextual grounds . . . ." Plaintiff alleged GM intentionally and negligently
withheld material facts relating to GM's willingness or ability to perform its obligations;
misrepresented to plaintiff that it would treat dealer transfer applications in a fair,
reasonable, nonarbitrary and nondiscriminatory manner; and misrepresented the reasons
for disapproving the transfer. Plaintiff alleged GM intended to disrupt the contractual
and economic relationships between it and Grenier, and engaged in unfair trade practices
by unreasonably withholding consent to the purchase agreement in violation of Vehicle
Code section 11713.3. Plaintiff sought declaratory and injunctive relief as to the nature
of the written agreements between it and GM, and GM's obligations in regard to the
approval of dealership transfer applications.
GM moved for summary judgment or alternatively summary adjudication of
issues. It argued the De La Fuente dealer agreement did not give plaintiff any contractual
right to require GM to authorize plaintiff to sell and service Buick and GMC vehicles in
El Cajon; that it only gave plaintiff contractual rights regarding the Cadillac line. GM
further argued that the Grenier dealer agreement provided GM with a complete defense,
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i.e., the right to make the "final decision" regarding approval or disapproval of any
proposed change in location of Grenier's dealership pursuant to its business judgment.
GM presented a declaration from Dale Sullivan, its regional director of business
operations for GM's western region, who averred that plaintiff does not and never had
any contractual relationship with GM regarding the Buick or GMC line-makes. Sullivan
further stated: "Based on their geographic separation and the mountainous terrain
between Poway and El Cajon, as well as the circuitous freeways and mountain roads that
provide access between the two communities, GM concluded that the proposed relocation
of the Buick-GMC dealership from Poway to El Cajon would have made it very difficult
for [plaintiff] to adequately serve Buick-GMC sales and service customers in the Poway
market." GM also presented a declaration from a member of its legal staff who explained
that after the June 2009 bankruptcy, the bankruptcy court enjoined all persons having
claims against GM's predecessor from asserting those claims against GM, and that
plaintiff's claims in the present case were not included in the liabilities GM agreed to
assume from its predecessor.
Plaintiff opposed the motion. It argued the stated reason for GM's disapproval of
the proposed relocation agreement was without documentation and a pretext; that the true
reason was GM's "historical animus" against plaintiff and its owner. It maintained that
the concept of dealer network planning under the De La Fuente dealer agreement was "an
amorphous and ever-mutating concept that apparently has no fixed criteria whatsoever"
and that GM's position was contradicted by the fact that GM considered Poway and El
Cajon within the same market for Buick and GMC. Plaintiff argued there were triable
6
issues of material fact as to GM's contractual duties to plaintiff under the De La Fuente
dealer agreement with respect to GM's consideration and disapproval of plaintiff's change
request as well as whether GM's disapproval of the deal was a proper exercise of its
business judgment. According to plaintiff, a jury could conclude that GM had improper
motives or made an insufficient inquiry to support its conclusion that the transfer of the
lines to plaintiff was incompatible with its dealer network planning. Plaintiff also argued
its misrepresentation claims stemmed from a 2009 statement made by GM agent Kate
Hardy that the criteria for GM's approval of plaintiff acquiring Buick and GMC product
lines was the closing of one of the five GM locations in San Diego County.
Plaintiff submitted a declaration from its secretary and a stockholder in the
corporation, David Wick. Wick stated he had been personally involved since 2007 in
plaintiff's efforts to acquire from GM the right to sell Buick and GMC product lines, and
recounted plaintiff's unsuccessful efforts to purchase another Buick-Pontiac-GMC
dealership located in Lemon Grove (the McClellan dealership) in June and July 2007. He
averred that after GM's predecessor went bankrupt, it tried to take away plaintiff's
dealership by petitioning the federal court for an order cancelling plaintiff's dealer
agreement, but eventually, on the day of the court hearing, agreed to enter into "the exact
same contract" with plaintiff. Wick described representations made by GM agent Kate
Hardy as to the criteria for plaintiff's acquisition of the Buick and GMC product lines:
that GM "only wanted 5 Buick/GMC locations (or, 'points' as they are known in the
trade) in San Diego County." He asserted GM's rejection of the proposed relocation
agreement was not reasonable because De La Fuente and Grenier were already obligated
7
based upon their respective contracts with GM to service each others' areas, and GM's
rejection "assumes that GM could not have simply approved the specific transaction for
Grenier, which was going out of business, to sell to [sic] its franchise rights to [De La
Fuente], and then approving another operator for the Poway location." Wick stated that
at the time of GM's rejection, GM maintained an "open point"4 at the former McClellan
dealership in Lemon Grove, which was less than 10 miles from plaintiff's location, and
"[n]othing prevented GM, assuming it wanted to have a dealer in Poway, from giving
[plaintiff] that (Lemon Grove) 'open point' that had sat fallow for years after GM (in
2007) rejected [plaintiff's] bid to move those lines to El Cajon."
Plaintiff also presented a declaration from Stockton, an expert in "sales
performance measurement" including brand performance or market share, and dealer
sales performance. Stockton criticized GM's reliance on travel conditions between
dealerships (as opposed to markets) as "an inferior and unconventional manner of
assessing proximity of customers to dealerships," and opined that GM's policy as to the
plaintiff's and Grenier's APRs was inconsistent with the notion that Poway and El Cajon
were "practically and commercially separate." He averred that plaintiff would have been
the Buick-GMC dealership with the primary territorial advantage over at least some of
the territory within the Lemon Grove open point, and the territory would have enhanced
4 Plaintiff's expert Stockton explained that an open point is a geographic area in which no authorized dealership is active, but future authorized representation is planned or at least contemplated. He states: "When a manufacturer closes an Open Point (as opposed to filling an Open Point with an authorized dealership), this action signals the intention to service the territory in the Open Point by surrounding dealerships." 8
the market potential of plaintiff's prospective Buick-GMC dealership. Stockton reviewed
a GM network plan and market study performed by a company called Channel Vantage,
stating it did not make a "comparative assessment of the relative desirability of the
Poway and El Cajon locations." He averred: "There are several techniques available for
assessing the relative desirability of locations, and while these techniques are not
necessarily determinative, none were attempted." According to Stockton, GM's
arguments and its market study did not "allow for an evaluation of the customer
convenience and/or dealership access implications if GM were to approve the [De La
Fuente] location."
After ruling on the parties' evidentiary objections and excluding the evidence to
which objections were sustained, the court granted summary judgment. Applying the
business judgment rule as set forth in Berg & Berg Enterprises, LLC v. Boyle (2009) 178
Cal.App.4th 1020, 1045, it ruled plaintiff had not presented evidence demonstrating GM's
unreasonableness or improper motive, and thus did not create a triable issue of fact to
overcome a presumption that GM's exercise of its business judgment was sound. Having
reviewed the Wick and Stockton declarations, the court concluded it could not logically
infer that GM acted with a conflict of interest, improper motives, fraud, bad faith, or that
GM was " 'overreaching.' " The trial court therefore deferred to GM's business judgment.
It ruled Hardy's representation, even if true, did not prove GM promised to approve
plaintiff's acquisition or the relocation of an existing dealership. It ruled plaintiff had not
shown wrongdoing or tortious conduct for purposes of its interference with contract or
prospective advantage claims, nor had it shown injury or damages. Finally, as to
9
plaintiff's unfair business practices claim, the court ruled plaintiff did not have standing
to assert the protections of Vehicle Code section 11713.3, but even if the statute applied,
plaintiff had not presented evidence that GM's consent to the dealership transfer was
unreasonably withheld.
Plaintiff timely filed this appeal.
DISCUSSION
I. Summary Judgment Standards
Summary judgment is appropriate if all the papers submitted show that there is no
triable issue as to any material fact and that the moving party is entitled to judgment as a
matter of law. (Code Civ. Proc., § 437c, subd. (c).)
A defendant moving for summary judgment "bears the burden of persuasion that
'one or more elements of' the 'cause of action' in question 'cannot be established,' or that
'there is a complete defense' thereto. [Citation.] . . . [T]he party moving for summary
judgment bears an initial burden of production to make a prima facie showing of the
nonexistence of any triable issue of material fact; if he carries his burden of production,
he causes a shift, and the opposing party is then subjected to a burden of production of his
own to make a prima facie showing of the existence of a triable issue of material fact. . . .
A prima facie showing is one that is sufficient to support the position of the party in
question." (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850-851; Knowles v.
Superior Court (2004) 118 Cal.App.4th 1290, 1301.) "There is a triable issue of material
fact if, and only if, the evidence would allow a reasonable trier of fact to find the
10
underlying fact in favor of the party opposing the motion in accordance with the
applicable standard of proof." (Aguilar, at p. 850.)
In conducting a summary judgment analysis, this court does not consider evidence
"to which objections have been made and sustained." (Code Civ. Proc., § 437c, subd. (c);
Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 334.) The trial court's evidentiary
rulings are reviewed for abuse of discretion. (Miranda v. Bomel Construction Co., Inc.
in the light most favorable to the losing plaintiff, liberally construing the plaintiff's
submissions and strictly scrutinizing the defendant's showing, to resolve any evidentiary
doubts or ambiguities in the plaintiff's favor." (Id. at p. 420.)
II. Breach of Contract
Plaintiff contends it raised a triable issue of material fact as to its breach of
contract cause of action. Specifically, it argues article 4.4.2 of the De La Fuente dealer
agreement is unambiguous and must be interpreted to require GM to evaluate its
proposed change in use of its premises, including the addition of Buick-GMC lines, and
apply a good faith exercise of its business judgment as to that proposal. It maintains its
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evidence raises a triable issue as to whether GM reasonably and in good faith exercised
its business judgment in rejecting the proposed relocation agreement. Plaintiff further
argues, for the first time on appeal, that the dealer agreement is a contract of adhesion,
which requires ambiguities to be resolved against GM, the party who drafted it. Whether
a contract is one of adhesion depends on whether the weaker party is free to negotiate and
alter the printed terms of the proffered agreement. (See Parr v. Superior Court (1983)
139 Cal.App.3d 440, 444.) Because plaintiff did not assert this fact-based theory in its
summary judgment opposition below, it is forfeited for purposes of appellate review.
(Peart v. Ferro (2004) 119 Cal.App.4th 60, 70.)
In response, GM argues that article 4.4.2 only governs the location and permitted
uses of De La Fuente's Cadillac dealership facility without giving De La Fuente an
affirmative contract right to apply to GM to acquire or add product lines.5 GM argues
the actual decision challenged by plaintiff is GM's decision in response to Grenier's
proposal to change ownership, which is governed by a separate contract: Grenier's dealer
5 Both plaintiff and GM point to the trial court's conclusions about the De La Fuente dealer agreement, i.e., that it does not give De La Fuente the right to require GM to authorize it to service any other line-make, and that De La Fuente's right to seek GM's approval for a change in use of the premises "does not provide that Plaintiff has a contract right to require [GM] to accept or review an application for additional [GM] product lines." GM argues the court's conclusion alone warrants summary adjudication on plaintiff's breach of contract cause of action. Because our summary judgment review is de novo, the trial court's conclusions are not relevant to the analysis. This is particularly true when the matter involves interpretation of a written contract, which is a judicial function unless the interpretation turns on the credibility of extrinsic evidence. (Hess v. Ford Motor Co. (2002) 27 Cal.4th 516, 527; Scheenstra v. California Dairies, Inc. (2013) 213 Cal.App.4th 370, 390.) The interpretation of a contract is a question of law even when conflicting inferences may be drawn from uncontroverted evidence. (Hess, at p. 527.) 12
agreement. Because De La Fuente did not apply to GM to become a Buick-GMC
authorized dealer under Grenier's agreement, GM asserts, the proposed relocation was
"moot ab initio." And, GM argues, the Grenier agreement, specifically articles 4.4.2 and
12.2.2 regarding changes in ownership and management, also governed GM's
consideration of plaintiff's request to acquire the existing dealership and remove it from
Poway. GM argues that as a result, plaintiff has no standing to enforce the Grenier
contact, did not have a contractual relationship with GM regarding the Buick and GMC
lines, and cannot impose an obligation on GM to consider an application from or enter
into a relationship with a third party. The only contractual right GM recognizes is
plaintiff's right to seek approval for a change in use; GM argues that under article 4.2.2,
that right "obviously would require GM to evaluate [plaintiff's] proposal and exercise its
business judgment in light of Cadillac dealer network planning considerations."
A. The Relevant Contract Provisions
GM's standard provisions, including the provisions at issue, are incorporated in all
GM dealer sales and service agreements. In plaintiff's case, the standard provisions are
appended to a dealer sales and service agreement giving plaintiff the right to purchase
and sell only Cadillac products. As plaintiff essentially concedes,6 nothing within its
6 Plaintiff asserts it "has never argued that it has a right to require GM to authorize it to sell Buick and GMC regardless of any other considerations or factors." It concedes the trial court was correct in stating that it "has no contract right to require GM to 'accept' its proposed new use of the dealership premises." Plaintiff states it "has never asserted that GM is required to approve a change in dealer use of the premises, regardless of any other facts or circumstances." 13
agreement, or the GM standard provisions, gives plaintiff an affirmative right to purchase
or sell Buick-GMC vehicles.
Article 4.4.2 of GM's dealer agreement addresses changes in locations and uses of
dealer premises. It provides: "If Dealer wants to make any change in location(s) or
Premises, or in the uses previously approved for those Premises, Dealer will give [GM]
written notice of the proposed change, together with the reasons for the proposal, for
[GM's] evaluation and final decision in light of dealer network planning considerations.
No change in location or in the use of Premises, including addition of any other vehicle
lines, will be made without [GM's] prior written authorization pursuant to its business
judgment. [¶] Before [GM] requires any changes in Premises, it will consult with
Dealer, indicate the rationale for the change, and solicit Dealer's views on the proposal.
If, after such review with Dealer, [GM] determines a change in Premises or location is
appropriate, the Dealer will be allowed a reasonable time to implement the change. Any
such changes will be reflected in a new Location and Premises Addendum or other
written agreement executed by Dealer and General Motors. [¶] Nothing herein is
intended to require the consent or approval of any dealer to a proposed relocation of any
other dealer."
Article 12.2 of GM's standard provisions provides in part: "If Dealer proposes a
change in Dealer Operator, a change in ownership, or a transfer of the dealership business
or its principal assets to any person conditioned upon [GM] entering into a Dealer
Agreement with that person, [GM] will consider Dealer's proposal and not unreasonably
refuse to approve it, subject to the following: [¶] . . . [¶] . . . [GM] agrees to consider
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Dealer's proposal, taking into account factors such as (a) the personal, business, and
financial qualifications of the proposed dealer operator and owners, and (b) whether the
proposed change is likely to result in a successful dealership operation with acceptable
management, capitalization, and ownership which will provide satisfactory sales, service,
and facilities at an approved location, while promoting and preserving competition and
customer satisfaction."
In interpreting a written agreement, our goal is to give effect to the mutual intent
of the parties as it existed at the time, insofar as that intent can be ascertained and is
lawful. (Civ. Code, § 1636; People ex rel. Lockyer v. R.J. Reynolds Tobacco Co. (2003)
107 Cal.App.4th 516, 525.) If the language of the agreement is clear and explicit and
does not involve an absurdity, determination of the mutual intent of the parties and
interpretation of the agreement is to be based on the language of the agreement alone.
(Civ. Code, §§ 1638, 1639; People ex rel. Lockyer, at p. 525.) Further, "[t]he whole of a
contract is to be taken together, so as to give effect to every part, if reasonably
practicable, each clause helping to interpret the other." (Civ. Code, § 1641.) The
language " ' "in a contract must be construed in the context of that instrument as a
whole." ' " (Palmer v. Truck Ins. Exchange (1999) 21 Cal.4th 1109, 1118.) If possible,
the court should give effect to every provision of the contract. (National City Police
Officers' Assn. v. City of National City (2001) 87 Cal.App.4th 1274, 1279.)
Neither party asserts there are ambiguities in the contractual language, nor does
either party suggest any interpretation of article 4.4.2's phrase "change . . . in the uses
previously approved for those Premises" other than it should be understood by its plain
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meaning. Reading the De La Fuente dealer agreement with all of its related agreements,
we conclude that the only affirmative contractual obligation imposed on GM in article
4.4.2 is to evaluate and make a final decision on plaintiff's May 2010 proposed change
request (which happened to request the addition and relocation of Grenier's Buick-GMC
line) in light of dealer network planning considerations. The second sentence of article
4.4.2 plainly only prohibits dealers from making a location change or adding vehicle lines
without GM's prior written authorization, which is to be made "pursuant to its business
judgment."
Any proposed transfer of dealership business is governed by article 12.2, but the
reference to "the dealership business" plainly is to De La Fuente's Cadillac dealership, not
any other dealership, including Grenier's. Under that provision, GM's contractual
obligation to consider De La Fuente's proposal (and not unreasonably refuse to approve
it) arose only if De La Fuente proposed a transfer of its Cadillac dealership.
In short, nothing in article 4.4.2 obligates GM to exercise its business judgment,
and it does not impose any reasonableness standard upon GM in evaluating any proposed
change in use. GM inserted a reasonableness standard in article 12.2, but omitted any
such standard in article 4.4.2. " ' "It is a general rule governing the construction of
contracts that unless a contract is ambiguous, its meaning must be determined from the
words used; and courts will not, because a more equitable result might be reached
thereby, construe into the contract provisions that are not therein. In construing a
contract which purports on its face to be a complete expression of the entire agreement,
courts will not add thereto another term, about which the agreement is silent." ' " (Apra v.
16
Aureguy (1961) 55 Cal.2d 827, 830-831, citations omitted; Edwards v. Arthur Andersen,
LLP (2008) 44 Cal.4th 937, 954 ["when courts construe an instrument, a judge is 'not to
insert what has been omitted, or to omit what has been inserted' "].) Our interpretation of
contractual language is de novo, and thus it is of no import that GM appears to concede in
its respondent's brief that article 4.4.2 requires it to "evaluate [De La Fuente's] proposal
and exercise its business judgment in light of Cadillac dealer network planning
considerations."
We decline to import the statutory (Corp. Code, § 309, subd. (a)) or common law
business judgment rule into section 4.4.2 of the contract, as the trial court did below.7
Nothing in the record indicates that GM's decision to reject De La Fuente's proposed
7 The common law business judgment rule insulates from court intervention management decisions made by corporate directors in good faith in what the directors believe is the organization's best interests. (Scheenstra v. California Dairies, Inc., supra, 213 Cal.App.4th at p. 387; Berg & Berg Enterprises, LLC v. Boyle, supra, 178 Cal.App.4th at p. 1045.) "The . . . rule is ' " 'a judicial policy of deference to the business judgment of corporate directors in the exercise of their broad discretion in making corporate decisions.' " [Citations.] [It] is based on the premise that those to whom the management of a business organization has been entrusted, and not the courts, are best able to judge whether a particular act or transaction is helpful to the conduct of the organization's affairs or expedient for the attainment of its purposes. [Citations.] The rule establishes a presumption that directors' decisions are based on sound business judgment, and it prohibits courts from interfering in business decisions made by the directors in good faith and in the absence of a conflict of interest. [Citations.] ' "A hallmark of the business judgment rule is that a court will not substitute its judgment for that of the board if the latter's decision can be 'attributed to any rational business purpose.' " ' " (Berg, at p. 1045.) The rule, however, does not shield actions taken without reasonable inquiry, with improper motives, or as a result of a conflict of interest. (Ibid.) In most cases, the presumption created by the business judgment rule can be rebutted only by evidence establishing "fraud, bad faith, overreaching or an unreasonable failure to investigate material facts. [Citation.] Interference with the discretion of directors is not warranted in doubtful cases." (Id. at p. 1046.) 17
relocation was made by or at the direction of GM corporate directors, nor is there any
indication the parties in entering into the dealer agreement intended the phrase "business
judgment" to refer to that judicial policy of deference (Everest Investors 8 v. McNeil
Partners (2003) 114 Cal.App.4th 411, 429), which is commonly invoked in shareholder
derivative actions. (See Scheenstra v. California Dairies, Inc., supra, 213 Cal.App.4th at
p. 387; Desaiqoudar v. Meyercord (2003) 108 Cal.App.4th 173, 179 [in a derivative
action, "judicial review of the decision of a special litigation committee is governed by
the business judgment rule"]; but see Everest Investors 8, at pp. 430-432 [concluding in a
nonderivative action by a limited partner that triable issues of material fact existed as to
general partnership's improper motives and conflict of interest, which precluded summary
judgment based on the business judgment rule].)
B. Plaintiff's Evidence Does Not Raise A Triable Issue of Material Fact as to GM's
Breach of the De La Fuente Dealer Agreement or Breach of the Covenant of Good Faith
and Fair Dealing
Having determined the parties' rights and obligations under the De La Fuente
dealer agreement and its related agreements, we evaluate whether GM met its threshold
summary judgment burden, and whether plaintiff's evidence raised a triable issue of
material fact, as to GM's alleged breach of contract. As we have stated, the De La Fuente
dealer agreement imposed a contractual obligation on GM to evaluate and make a final
decision on plaintiff's May 2010 relocation proposal in light of dealer network planning
considerations.
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In its moving papers, GM presented evidence sufficient to meet its threshold
burden to show it met its contractual obligation to evaluate De La Fuente's proposal and
make a final decision in light of dealer network planning considerations. Plaintiff in its
responding separate statement did not dispute that the GM zone manager responded to its
change request on August 9, 2010 (asserting the letter speaks for itself). In doing so, the
zone manager quoted GM's dealer network planning considerations set forth in article 4.1
of the De La Fuente dealer agreement, including the fact that dealers must be "located
properly" and GM's dealer network must "maximize the convenience of customers in
purchasing Products and having them serviced." (Italics omitted.) The zone manager
explained that "GM's network planning for Buick and GMC in Poway is to maintain
representation"; that the proposed relocation to El Cajon was 12 miles away; and that the
relocation proposal was thus "inconsistent with the GM's [sic] dealer network planning
for both the Poway and El Cajon communities as well as the San Diego Multiple Dealer
Area." GM also presented, via Sullivan's declaration, a reason for rejecting the proposed
relocation agreement grounded in factors set out in GM's dealer network plan; that is, the
distance between Poway and El Cajon would have made it difficult for De La Fuente to
adequately serve Buick-GMC customers in the Poway market both for sales and service.
This shifted the burden to plaintiff to demonstrate the presence of issues of material fact
on the question.
We cannot say plaintiff demonstrated, either directly or by inference, that GM
failed to meet its contractual obligations under article 4.4.2. Plaintiff sought to present
evidence that GM conducted an unreasonable inquiry and failed to follow its normal
19
policies, or that it acted on pretext or improper motives. It argues expert Stockton's
declaration raised issues for a jury as to whether GM failed to follow ordinary procedures
in assessing the proposed sale of the Buick and GMC lines, including by showing GM's
analysis failed as a matter of process. Plaintiff maintains its opposing summary judgment
evidence raises an inference of pretext or improper conduct by GM; that GM's market
analysis was a "sham" to "insulate a decision to quash the Grenier sale that GM made
long before it even commissioned the market study to begin with." It relies on
Desaigoudar v. Meyercord, supra, 108 Cal.App.4th 173,8 and cases from the Second
Circuit and other federal district courts. We have rejected any assertion that the dealer
agreement incorporated principles of the business judgment rule, and thus plaintiff
misplaces its efforts to demonstrate some sort of pretext, improper motive, or inadequate
investigation on GM's part. Moreover, we are not bound by the cited federal authorities.
(See People v. Gonzales and Solis (2011) 52 Cal.4th 254, 296.)
At oral argument, plaintiff nevertheless maintained that Stockton's averments in
paragraphs 13, 16 and 17 of his declaration raise a triable issue of material fact as to
whether GM made its evaluation and final decision in light of dealer network planning
8 In Desaigoudar, supra, 108 Cal.App.4th 173, the court held that to raise a triable issue of material fact as to the inadequacy of an investigation so as to preclude application of the business judgment rule, a plaintiff must show the procedures employed by the directors (or in that case, a special litigation committee) were so inadequate to suggest fraud or bad faith. (Desaigoudar, at p. 189.) According to Desaigoudar, " '[p]roof . . . that the investigation has been so restricted in scope, so shallow in execution, or otherwise so pro forma or halfhearted as to constitute a pretext or sham, consistent with the principles underlying the application of the business judgment doctrine, would raise questions of good faith or conceivably fraud which would never be shielded by that doctrine.' " (Ibid.) 20
considerations. In these paragraphs, Stockton stated De La Fuente would have had a
territorial advantage over some of the Lemon Grove open point territory, which would
have enhanced the market potential of the prospective De La Fuente
Buick/GMC/Cadillac dealership; that GM's Channel Vantage market study showed that
GM's effective market shares for Buick and GMC were lower in De La Fuente's area of
geographic sales and service advantage; and that, in Stockton's experience, GM
associated low effective market shares with lost opportunity for the brand, and that GM
had taken the position in contested matters that this factor pointed to the need for
additional authorized representation. Stockton also stated that the Channel Vantage
market study calculated similar expected vehicle registrations in both De La Fuente's and
Grenier's areas, and he criticized the market study for failing to make a comparative
assessment of the relative desirability of the Poway and El Cajon locations. None of
these averments, which merely posit the inadequacy of GM's analysis or suggest that GM
should have viewed the data differently to reach a different result, contradict GM's
showing that it did in fact take into account elements of its dealer network planning in
rejecting the proposed relocation. That was its only obligation under the De La Fuente
dealer agreement.
We acknowledge, of course, that implied in every contract there is a covenant of
good faith and fair dealing not to do anything that would destroy or injure the other
parties rights under the contract. (Wilson v. 21st Century Ins. Co. (2007) 42 Cal.4th
" ' " '[W]here a contract confers on one party a discretionary power affecting the rights of
the other, a duty is imposed to exercise that discretion in good faith and in accordance
with fair dealing' " ' " and that good faith and reasonableness are questions of fact. (Peak-
Las Positas, at p. 106 [" 'Denying consent solely on the basis of personal taste,
convenience or sensibility is not commercially reasonable' "].)
Applying these standards to GM's obligation to evaluate and make a final decision
on plaintiff's relocation proposal, we cannot say Stockton's declaration raises issues for a
jury to decide as to whether GM acted unreasonably to harm plaintiff's rights under the
De La Fuente dealer agreement. First, Stockton does not squarely focus on the pertinent
inquiry: whether GM evaluated and made a final decision on plaintiff's proposal in light
of dealer network planning considerations. Stockton's statements that GM's comparison
of travel times is an "unconventional manner of assessing proximity of customers to
dealerships" or that he had never seen GM evaluate customer proximity in this way, does
not establish, or raise a reasonable inference, that GM either failed to make a decision, or
made its decision in disregard of its dealer network planning policies. Stockton criticized
the Channel Vantage market study data as failing to properly compare the relative
desirability of the Poway and El Cajon locations or evaluate customer convenience, but
these criticisms do not preclude summary judgment. Stockton's declaration in fact
support's GM position because it acknowledges that GM conducted a market study and
took into account market shares for Buick-GMC and expected registrations, all factors in
GM dealer network planning. The fact that De La Fuente was the only Cadillac dealer
within the APR that did not also sell Buick-GMC lines, or that GM had overlapping
22
APRs for Grenier and De La Fuente does not give rise to an inference of improper motive
or bad faith on GM's part. Nor are we persuaded that Wick's declaration concerning the
closure of GM's Lemon Grove open point allows a conclusion that GM or its
representatives acted out of animus.9 GM's predecessor's actions in 2007, even if
relevant to GM's liability in this case, do not permit a rational inference that a history of
animus exists between GM and De La Fuente. In sum, we conclude plaintiff's evidence
does not show GM conducted itself in such an unreasonable manner to frustrate plaintiff
from obtaining the benefits under the De La Fuente dealer agreement, namely, plaintiff's
right to an evaluation and final decision in light of dealer network planning
considerations. Plaintiff has not demonstrated a triable issue of material fact to defeat
summary judgment on its claim for breach of contract.
As plaintiff relies solely upon its previous arguments, our conclusion that
summary judgment was proper on plaintiff's breach of contract cause of action
necessarily disposes of its claim of breach of the implied covenant of good faith and fair
dealing. (See Agosta v. Astor (2004) 120 Cal.App.4th 596 [covenant cannot impose
substantive duties or limits on the contracting parties beyond those incorporated in the
specific terms of their agreement; if a decision does not breach a substantive contract
provision, it is not precluded by the covenant of good faith and fair dealing].)
9 The trial court sustained GM's objections on foundation, relevance and hearsay grounds to Wick's statement that GM had initially represented it would approve an application to transfer the McClellan Buick-GMC-Pontiac franchises to De La Fuente. We do not consider that statement in our analysis. 23
III. Intentional/Negligent Misrepresentation Causes of Action
Plaintiff contends the trial court erred in granting summary judgment on its fifth
and sixth causes of action for intentional and negligent misrepresentation. Specifically,
plaintiff argues the trial court's interpretation of article 4.4.2 was erroneous as a matter of
law; that the article "gives [plaintiff] a contractual right to seek GM's approval for adding
vehicle lines" and a "corresponding duty upon GM to consider such approval 'in light of
dealer network planning considerations' and pursuant to its 'business judgment.' "
Plaintiff further argues the court's interpretation of Hardy's statement was "too narrow
and constrained . . . ." According to plaintiff, reasonably construed, the evidence shows
Hardy told Wick the only criteria to be satisfied to obtain GM's authorization to sell
Buick and GMC vehicles with Cadillacs at plaintiff's El Cajon location was that both
before and after there be only five Buick-GMC points in San Diego County. It asserts the
trial court's ruling that Hardy's representation did not reflect a promise is an "exercise in
hair-splitting" unsupported by Wick's declaration and the applicable standard of review.
Plaintiff's focus on the trial court's rulings is unhelpful, because, as we have stated,
our role on appeal from a summary judgment is to assess the parties' papers and evidence
de novo. (Ace American Ins. Co. v. Walker (2004) 121 Cal.App.4th 1017, 1027.)
Plaintiff sets forth little in the way of contract interpretation principles to govern our
interpretation of the De La Fuente dealer agreement, but more importantly, it has not
presented any meaningful argument on the matter (other than telling us the trial court's
interpretation is wrong as a matter of law) to justify reversal. Even where our review is
de novo, the plaintiff is required to support its position with relevant legal arguments and
24
authority. Absent meaningful argument, we conclude plaintiff has forfeited any
challenge to summary judgment or adjudication on these causes of action. (See Taylor v.
Roseville Toyota, Inc. (2006) 138 Cal.App.4th 994, 1001, fn. 2.)
But considering the merits in any event, we would conclude summary judgment
was properly granted on these causes of action. To establish fraud, a plaintiff must show
a misrepresentation (false representation, concealment, or nondisclosure), knowledge of
falsity, and intent to induce reliance, justifiable reliance, and resulting damage.
(Robinson Helicopter Co., Inc. v. Dana Corp. (2004) 34 Cal.4th 979, 990; Lazar v.
Superior Court (1996) 12 Cal.4th 631, 638.) "A promise to do something necessarily
implies the intention to perform; hence, where a promise is made without such intention,
there is an implied misrepresentation of fact that may be actionable fraud. [Citations.]
[¶] An action for promissory fraud may lie where a defendant fraudulently induces the
plaintiff to enter into a contract. [Citations.] In such cases, the plaintiff's claim does not
depend upon whether the defendant's promise is ultimately enforceable as a contract."
(Lazar, supra, 12 Cal.4th at p. 638.) Where a fraud or misrepresentation claim is
predicated on a failure to perform contractual obligations, " 'something more than
nonperformance is required to prove the defendant's intent not to perform his promise.' "
(Tenzer v. Superscope, Inc. (1985) 39 Cal.3d 18, 30-31; Magpali v. Farmers Group, Inc.
(1996) 48 Cal.App.4th 471, 481.)
With respect to the essential element of justifiable or reasonable reliance, "whether
a party's reliance was justified may be decided as a matter of law if reasonable minds can
come to only one conclusion based on the facts." (Guido v. Koopman (1991) 1
25
Cal.App.4th 837, 843; see also Alliance Mortgage Co. v. Rothwell (1995) 10 Cal.4th
1226, 1239.) "[E]ach case in which it is claimed that fraud is involved must be
considered on its own facts," in light of "the circumstances and condition of the parties."
(Koch v. Williams (1961) 193 Cal.App.2d 537, 541.) The elements of negligent
misrepresentation also include justifiable reliance and damage. (Fox v. Pollack (1986)
181 Cal.App.3d 954, 962.)
Plaintiff's causes of action for "intentional misrepresentation/promise without
intent to perform" and negligent misrepresentation generally set forth alleged
representations as to GM's willingness to perform in accordance with the terms and
conditions of the contracts attached to the complaint, assertedly made by GM "agents and
employees" without identifying who spoke or when. In moving for summary judgment,
GM pointed to the lack of specificity, and also argued that there could be no false
representation to perform under the contracts because (1) GM was not a party to the
plaintiff/Grenier proposed asset purchase agreement and (2) GM owed no obligations to
plaintiff under the De La Fuente dealer agreement with respect to Buick and GMC lines,
or under Grenier's dealer agreement.
Plaintiff opposed summary judgment with Wick's declaration, in which Wick
stated: "Each year GM hosts an annual event for dealers across the country which I
and/or Mr. De La Fuente regularly attend. At GM's annual event in Las Vegas in 2009,
GM agent Kate Hardy in my presence set forth criteria for GM's approval of [De La
Fuente] acquiring the Buick and GMC product lines; this being that GM only wanted 5
Buick/GMC locations (or, 'points' as they are known in the trade) in San Diego County.
26
[¶] In reliance on this representation by GM, I negotiated with [Grenier] the terms of
acquiring the additional product lines and, specifically, paying $250,000 for these lines
and $100.00 for each Buick or GMC what [sic] we sold for 5 years." Plaintiff also
pointed to the dealer agreement and its May 2010 application for a change request in
which GM assertedly represented it "would consider [De La Fuente's] application to
acquire Grenier's product lines fairly and would not unreasonably refuse to approve it."10
Plaintiff argued GM's intent not to perform these promises was evidenced by GM's
actions in 2007, set out in paragraphs 5 though 8 of Wick's declaration, and the asserted
absence of empirical data for GM's disapproval of plaintiff's application as set out in
Stockton's declaration pertaining to GM's closure of the Lemon Grove open point.
Plaintiff's opposing summary judgment evidence did not raise a triable issue of
material fact to avoid summary judgment on these claims. There is no dispute GM
approved plaintiff's qualifications for purposes of a change in ownership, and
disapproved the transaction only as to the relocation of the Buick-GMC dealership
operations to El Cajon, which was a condition precedent to the De La Fuente/Grenier
asset purchase. Hardy's asserted representation to Wick does not address criteria for
dealership relocation, only criteria for an acquisition of the Buick-GMC product lines.
10 The GM policies in the record expressly do not govern relocation requests. Bulletin No. 04-09, accompanying plaintiff's May 2010 application for a change request, states: "This Bulletin addresses only the GM policies applicable to proposed changes to the ownership and management structure of GM dealerships. Dealer ownership changes are often accompanied by independent requests for dealership relocation, or proposed new dualling arrangements or other network planning considerations. These requests should be evaluated separately in light of the applicable dealer network plan, and GM policies concerning those issues." (Italics added.) 27
Thus, plaintiff could not reasonably or justifiably rely on it to its detriment in entering
into the relocation agreement.
Nor could plaintiff reasonably rely on Hardy's representation in view of the broad
and comprehensive nature of De La Fuente dealer agreement, which plainly is intended to
govern the entire business relationship of the parties. The agreement's purpose, among
others, is to "state[] the terms under which Dealer and [GM] agree to do business
together" and "state[] the responsibilities of Dealer and [GM] to each other and to
customers . . . ." Additionally, the agreement states: "No [GM] representative is
authorized to orally grant, waive or revise any terms of this Agreement or any rights
conferred under this Agreement."11 Under these circumstances, as a matter of law,
plaintiff could not reasonably rely on Hardy's oral statements as setting forth criteria for
the relocation proposal that would bind GM in any way.
11 In full, article 17.11 of the De La Fuente dealer agreement provides: "No agreement between [GM] and Dealer which relates to matters covered herein, including the grant or amendment of any Dealer Agreement and no change in, addition to (except the filling in of blank lines) or modification of this Agreement, will be binding unless approved in a written agreement executed by an authorized person. Approvals required or provided for under this Agreement must be in writing by an authorized person. No [GM] representative is authorized to orally grant, waive or revise any terms of this Agreement or any rights conferred under this Agreement. [GM] and Dealer expressly waive application of any local, state or federal law, statute, or judicial decision allowing oral grant, modifications, amendments or additions of a Dealer Agreement notwithstanding an express provision requiring a writing signed by the Parties." 28
IV. Interference Claims
A. Interference with Prospective Economic Advantage
To prove intentional interference with prospective economic advantage, plaintiff
must show: (1) an economic relationship between the plaintiff and some third party, with
the probability of future economic benefit to the plaintiff; (2) the defendant's knowledge
of the relationship; (3) an intentional act on the part of the defendant designed to disrupt
the relationship; (4) actual disruption of the relationship; and (5) economic harm to the
plaintiff proximately caused by the acts of the defendant. (Edwards v. Arthur Andersen
LLP (2008) 44 Cal.4th 937, 944.) "The plaintiff must also prove that the interference was
wrongful, independent of its interfering character. [Citation.] '[A]n act is independently
wrongful if it is unlawful, that is, if it is proscribed by some constitutional, statutory,
regulatory, common law, or other determinable legal standard.' " (Edwards, at p. 944; see
generally Della Penna v. Toyota Motor Sales, USA, Inc. (1995) 11 Cal.4th 376, 381-385.)
An act is not independently wrongful merely because defendant acted with an improper
motive. (Korea Supply Co. v. Lockheed Martin Corp. (2003) 29 Cal.4th 1134.)
One court has held the tort duty not to interfere falls only on strangers-interlopers
who have no legitimate interest in the scope or course of the economic relationship.
(Kasparian v. County of Los Angeles (1995) 38 Cal.App.4th 242, 262; see Exxon Corp. v.
Superior Court (1997) 51 Cal.App.4th 1672; e.g., Applied Equipment Corp. v. Litton
Saudi Arabia Ltd. (1994) 7 Cal.4th 503, 513-514; Mintz v. Blue Cross of California
29
(2009) 172 Cal.App.4th 1594, 1603.)12 In Exxon Corp. v. Superior Court, for example,
in granting a summary judgment on a claim for tortious interference with business
relationship, the appellate court held a franchisor gas supplier was found to have a "clear
financial interest in its dealers" and was therefore "privileged to 'interfere' with the
contract." (Exxon Corp v. Superior Court, at p. 1688; see also Lowell v. Mother's Cake &
Cookie Co. (1978) 79 Cal.App.3d 13, 20-21 [invoking the privilege under Restatement of
Torts section 769, that " '[o]ne who has a financial interest in the business of another is
privileged purposely to cause him not to enter into or continue a relation with a third
person in that business if the actor . . . (a) does not employ improper means, and . . . (b)
acts to protect his interest from being prejudiced by the relation' " but holding on review
of a demurrer the allegations of the complaint did not show such privilege as a matter of
law].)
In moving for summary judgment, GM raised its preexisting right to evaluate and
approve the De La Fuente/Grenier transaction, a showing meeting its threshold summary
judgment burden. Plaintiff, however, did not address that issue. Rather, it argued below,
and repeats the argument on appeal, that GM's " 'independent wrongful act' is not its
12 "There is an important limitation to the use of this tort as a remedy for the disruption of contractual relationships. It can only be asserted against a stranger to the relationship. '[C]onsistent with its underlying policy of protecting the expectations of contracting parties against frustration by outsiders who have no legitimate social or economic interest in the contractual relationship, the tort cause of action for interference with a contract does not lie against a party to the contract. [Citations.]' . . . [¶] . . . [T]he same rationale should also bar prosecution of the tort of interference with prospective economic advantage against a party to the relationship from which the plaintiff's anticipated economic advantage would arise." (Kasparian v. County of Los Angeles, supra, 38 Cal.App.4th at p. 262.) 30
conduct in exercising its own contract right to evaluate the addition of Buick and GMC
lines to [plaintiff] under its 'business judgment.' " Instead, according to plaintiff, "The
wrongful conduct is GM's behind the scenes negotiations with Greiner to find another
buyer or negotiate a price for shutting Greiner's doors—at the same time [plaintiff] was in
a contract with Greiner to acquire its vehicle lines." (Emphasis omitted.)
Plaintiff's opposing summary judgment evidence consisted of e-mails exchanged
on August 10, 2010, and August 12, 2010, one and two days after GM disapproved the
relocation agreement. In the first, Grenier's president Ryan Butterfield asked GM
representative Alan Ray whether GM intended to buy Grenier out and replace it with
prospective candidates, whether GM had a buyer for Poway, and whether GM intended to
wind them down in Poway. In the second, Butterfield acknowledged a telephone
conversation and advised Ray he would have a dollar figure for him to "take us out." In
the third, Butterfield attached a letter noting GM had indicated its willingness to discuss
closing of Grenier's Buick-GMC franchises, advised Ray that Grenier would accept the
same consideration from GM as was specified under its agreement with De La Fuente,
and welcomed further discussions of options with GM.
But plaintiff's evidence cannot overcome GM's demonstration of a legitimate
interest and affirmative rights in connection with the relocation agreement, which in
connection with this cause of action, eliminates any tort duty on GM's part. Nor has
plaintiff explained with any meaningful argument or authority how GM's
communications with Grenier after GM already disapproved the transaction are unlawful,
or somehow are proscribed by some constitutional, statutory, regulatory, common law, or
31
other determinable legal standard. (Edwards v. Arthur Andersen LLP, supra, 44 Cal.4th
at p. 944.) Absent such a showing, GM is entitled to summary judgment on this cause of
action.
B. Interference with Contract
The underlying policy of an action for tortious interference with a contractual
relationship is to "protect[] the expectations of contracting parties against frustration by
outsiders who have no legitimate social or economic interest in the contractual
relationship . . . ." (Applied Equipment Corp. v. Litton Saudi Arabia Ltd., supra, 7
Cal.4th at p. 514.) The elements of such a claim are: (1) a valid contract between
plaintiff and Grenier; (2) GM's knowledge of the contract; (3) GM'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; Applied Equipment Corp. v. Litton
Saudi Arabia Ltd., at p. 514, fn. 5; LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 339.)
"Because interference with an existing contract receives greater solicitude than does
interference with prospective economic advantage [citation], it is not necessary that the
defendant's conduct be wrongful apart from the interference with the contract itself."
(Quelimane Co., at p. 55.)
Plaintiff contends the trial court made a legal error in summarily adjudicating its
cause of action alleging interference with the existing De La Fuente/Greiner contract
because such a cause of action does not require proof of an independent wrongful act. It
further argues the court erred by disregarding the e-mails and letter presented in
32
opposition to summary judgment on grounds they had occurred after August 9, 2010,
when GM declined to approve the proposed relocation.
Plaintiff's cursory arguments, which again unhelpfully challenge the trial court's
reasoning as incorrect, do not persuade us to reverse the summary judgment. Plaintiff
points out the e-mails and letter are dated only days after GM's rejection letter, and
asserts on summary judgment the communications should be viewed in its favor as
essentially contemporaneous. But plaintiff provides no meaningful argument or authority
explaining why, even assuming we view GM's communications with Grenier as
contemporaneous, that evidence precludes summary judgment on its tortious interference
with contract claim. This is particularly the case where it is undisputed that the contract
allegedly interfered with was expressly conditioned upon GM's approval of the
transaction. Because that precondition had not been met, there can be no showing that
GM's communications with Grenier on August 10, 2010, and August 12, 2010, interfered
with a valid contract between Grenier and plaintiff. Stated another way, GM was
contractually entitled to interfere with the De La Fuente/Grenier agreement; its consent
was written in as a necessary antecedent for that agreement's validity, and GM exercised
its right to withhold its consent.
V. Unfair Business Practices Cause of Action
Plaintiff concedes that its ninth cause of action for unfair business practices was
properly summarily adjudicated in GM's favor. Accordingly, we need not address that
cause of action.
33
DISPOSITION
The judgment is affirmed.
O'ROURKE, J.
WE CONCUR:
McCONNELL, P. J.
IRION, J.
34
AI Brief
AI-generated · verify before citing
Holding. The court held that the trial court properly granted summary judgment because the plaintiff failed to raise a triable issue of material fact regarding whether General Motors (GM) breached its contractual obligations or acted with improper motive in rejecting the plaintiff's proposed dealership relocation and asset purchase. The court concluded that GM's decision was a valid exercise of business judgment under the terms of the dealer agreements.
Issues
Whether the trial court erred in granting summary judgment on the plaintiff's breach of contract claim.
Whether the plaintiff raised a triable issue of material fact regarding GM's exercise of business judgment in rejecting the proposed relocation.
Whether the trial court properly adjudicated the plaintiff's claims for misrepresentation and tortious interference.
Disposition. Affirmed
Quotations verified verbatim against the opinion
“The trial court granted GM's motion for summary judgment on grounds, inter alia, plaintiff did not raise triable issues of material fact as to whether GM breached its contracts with De La Fuente”
“The trial court therefore deferred to GM's business judgment.”