Hansen v. Hilton & Hyland Real Estate CA2/7, B305592

Background

Christopher and Deanna Hansen sold their Los Angeles home in May 2016; broker Hilton & Hyland and agent Alphonso Lascano represented both seller and buyers and provided dual‑agency disclosures signed by the parties.
Four days before close a sprinkler burst; parties signed an addendum (signed July 28–29, 2016) providing a $60,000 escrow holdback for repairs, sellers to pay buyers’ PITI until repairs done, buyers’ contractor to perform repairs, and State Farm insurance proceeds to be used for repairs.
After escrow closed Hansen received State Farm payments ($~220,000 total) and then disputed bids and withheld approval of buyers’ contractor bids; buyers (the Shin/Shinns) arbitrated for breach, and the arbitrator found the Hansens breached the addendum and covenant of good faith, awarding the buyers ~$764,522.
The Hansens paid the award, then sued Hilton & Hyland and Lascano for professional negligence, breach of fiduciary duty, and unfair competition (alleging Lascano unlawfully drafted the addendum without being an attorney).
The trial court granted summary judgment for the broker defendants, holding that although disputed facts existed about breach, the Hansens could not show but‑for causation because their own misconduct caused the arbitration loss; it also held Lascano acted as scrivener as a matter of law for the UCL claim.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Broker breached professional/fiduciary duties by continuing dual rep, failing to advise counsel, and negligently drafting the addendum	Lascano failed to disclose/terminate conflict, should have advised counsel, and drafted a complex addendum beyond a broker’s expertise	Dual agency was disclosed; broker incorporated parties’ deal terms and warned parties to get counsel; drafting addenda is within broker practice	Court: triable facts existed on breach but summary judgment still proper because causation lacking
Causation: Did broker negligence cause the arbitration award?	But for Lascano’s negligence (e.g., not discovering State Farm would not pay buyer’s contractor), Hansens would have had a better outcome or avoided the sale/arbitration	Hansen’s own bad‑faith conduct (withholding funds, seeking extra insurance proceeds, micromanaging bids) caused the award	Held: no nonspeculative but‑for causation; Hansens’ misconduct was the proximate cause; summary judgment affirmed
Unauthorized practice of law / UCL (Bus. & Prof. Code § 17200) in drafting the addendum	Lascano suggested and prepared the addendum; drafting such a legal instrument by a non‑attorney violates § 6125 and supports UCL restitution	Lascano acted as scrivener of the parties’ negotiated terms, not as an attorney drafting legal instruments	Held: as a matter of law Lascano was a scrivener; even if misconduct, Hansens cannot show causation for the injury alleged; UCL claim fails
Use of the arbitrator’s findings in summary judgment	Hansens argued the trial court erred by treating the arbitration award as conclusive	Defendants argued the arbitration award was relevant evidence of the cause of the loss and Hansens relied on it in opposition	Held: the court properly considered the arbitration award as evidence in the summary judgment record (it has no preclusive effect but is admissible and relevant)

Key Cases Cited

Aguilar v. Atlantic Richfield Co., 25 Cal.4th 826 (discusses summary judgment burden shifting and proof requirements)
Oasis West Realty, LLC v. Goldman, 51 Cal.4th 811 (elements of professional negligence and fiduciary duty)
Viner v. Sweet, 30 Cal.4th 1232 (but‑for causation requirement in legal/professional malpractice claims)
Samara v. Matar, 5 Cal.5th 322 (de novo review of summary judgment and evidence viewing rules)
Vandenberg v. Superior Court, 21 Cal.4th 815 (limitations on preclusive effect of private arbitration awards)
Kwikset Corp. v. Superior Court, 51 Cal.4th 310 (standing and causation under Bus. & Prof. Code § 17200)