Procedural Posture

In an action to recover a broker commission, appellant investors challenged the summary judgment of the Superior Court of Los Angeles County (California), which was in favor of respondent brokers and found no triable issue as to the amount of damages, awarding respondent the full amount claimed. Appellants also challenged a jury verdict in favor of respondents in a tort action for intentional interference with prospective economic advantage.

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Overview

Respondent broker won summary judgment in a breach of contract action and a jury verdict in a tort action for conspiracy to interfere with prospective economic advantage related to a contract, against appellant investors after appellants refused to pay the commission for procurement of a commercial lease. Respondent received the full damages claim in the contract action, and received “back-up” and punitive damages in the tort action. On appeal, the court affirmed the summary judgment regarding appellants’ liability for breach of contract, even though there was a triable issue. The court held that no matter how the triable issue was resolved the result was that appellants were liable because they were a “party to be charged” and benefited from the agreement, and that appellants could not escape liability by having an agent sign the agreement in its place. The court reversed the damages portion of the summary judgment because there were triable issues regarding the amount. The court stated the tort claim was a viable cause of action, but reversed the verdict and remanded because the trial court failed to instruct the jury on the defense of good faith reliance on legal advice.

Outcome

The court affirmed the summary judgment which found appellant investors liable for breach of contract, but reversed the damages and remanded because of the triable issues regarding deductions in calculating the commission owed to respondent brokers. The court reversed the tort verdict, but stated it was a viable cause of action, and remanded for an instruction to the jury regarding “reasonable reliance on legal advice” as a justification defense.