DAVID HESTER, Plaintiff and Appellant, v. PUBLIC STORAGE, Defendant and Respondent.
G057335 (Super. Ct. No. 30-2017-00936828)
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION THREE
Filed May 28, 2020
CERTIFIED FOR PUBLICATION
DAVID HESTER,
Plaintiff and Appellant,
v.
PUBLIC STORAGE,
Defendant and Respondent.
OPINION
Appeal from a judgment of the Superior Court of Orange County, Melissa R. McCormick, Judge. Affirmed.
Keker, Van Nest & Peters, Erin E. Meyer and Christopher S. Sun for Defendant and Respondent.
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For several years, plaintiff David Hester was a reality television star on “Storage Wars.” He now finds himself at war with defendant Public Storage over the contents of a storage unit.
Following entry оf a stipulated judgment, plaintiff appeals, arguing summary adjudication was improper. Primarily, he contends the null and void clauses are invalid because (1) they are precluded by various statutes governing self-storage auction sales, and (2) he agreed to them under duress. We disagree. We also reject plaintiff‘s argument that defendant was required to file an unlawful detainer action to retake possession of the purchased goods after it rеscinded the sale. For these reasons, we determine the trial court properly granted defendant‘s summary adjudication motion and affirm the judgment.
I
FACTS AND PROCEDURAL HISTORY
Self-service storage facilities (owners or sellers) rent storage space to individuals (occupants) for the purpose of storing personal property. (
Defendant owns and operates self-storage facilities throughout the country and conducts lien sales in California pursuant to the Self-Service Storage Facility Act (
Defendant held a lien sale at its facility in Fountain Valley in July 2017. As a condition to participate in the sale, plaintiff signed a Delinquent Tenant Sale
At the sale, defendant accepted plaintiff‘s offer to purchase the contents of a storage unit for $11,800. Plaintiff then placed two locks on the unit‘s door and paid for the unit with a credit card and cash. He also signed a Certification of Public Sale for the unit, which certified he had made the winning bid for the contents of the storage unit during competitive bidding. The certification also stated plaintiff “[understood] that [defendant] reserve[d] the right to null and void the auсtion and sale of the unit for any reason.”
About half an hour after plaintiff signed the certification, a senior district manager for defendant learned the unit had been mistakenly listed for sale due to a technical glitch. The unit‘s occupant had paid his past due balance weeks before the sale, but the system incorrectly listed the unit as delinquent and marked it to be sold. Defendant would not have sold the unit had it known of this mistake.
After discovering the error, the district manager immediately notified plaintiff that defendant was voiding his purchase of the unit. Defendant reversed the portion of the purchase price paid by credit card and attempted to refund the cash balance. Plaintiff refused to accept the sale‘s rescission and declined the refund. Defendant then cut plaintiff‘s locks off the unit and replaced them with its own locks. Defendant later sent plaintiff a letter explaining that it had voided his рurchase of the unit and enclosed a refund of the cash balance and reimbursement for the cut locks.
Plaintiff filed this lawsuit in August 2017 based on the rescission of the sale, among other things. He then filed a first amended complaint in November 2017 asserting the following claims: (1) auctioneer misconduct; (2) conversion; (3) breach of contract; and (4) breach of the covenant of good faith and fair dealing. In June 2018, defendant moved for summary adjudication on the second, third, and fourth causes of action, all of which arose from defendant‘s allegedly wrongful rescission of the sale. The trial court granted the motion, finding defendant had properly voided the sale under the null and void clauses.
II
DISCUSSION
A. Standard of Review
“Summary judgment . . . provide[s] courts with a mechanism to cut through the parties’ pleadings in order to determine whether, despite their allegations, trial is in fact necessary to resolve their dispute.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) “Summary judgment should be granted if no triable issue exists as to any material fact and the moving party is entitled to judgment as a matter of law. [Citation.] The burden of persuasion is on the рarty moving for summary judgment. When the defendant is the moving party, the defendant must show the action has no merit. That showing is made if the defendant either negates an element of the plaintiff‘s cause of action or establishes that a complete defense exists. The burden then shifts to the plaintiff to show that a triable issue of material fact exists with respect to the cause of action or defense.” (Rostai v. Neste Enterprises (2006) 138 Cal.App.4th 326, 330.)
“We review the trial court‘s decision de novo, cоnsidering all the evidence set forth in the moving and opposition papers except that to which objections were made and sustained.” (Johnson v. City of Loma Linda (2000) 24 Cal.4th 61, 65-66.) “In ruling on the motion, the court must consider all of the evidence and all of the inferences reasonably drawn therefrom, and must view such evidence and such inferences in the light most favorable to the opposing party.” (Caloroso v. Hathaway (2004) 122 Cal.App.4th 922, 926.)
B. The Breach of Contract Claims
On appeal, plaintiff argues the trial court erred for the following reasons. First, the null and void clauses are precluded by
1. Preclusion
a. section 2328
Plaintiff‘s primary argument is based on section 2328, which provides rules governing auction sales. Before considering this argument, we first address defendant‘s contention in a footnote that this statute does not apply because plaintiff has not established the sale was an auction. There is enough evidence in the record to dispel this argument. The delinquent sale agreement and certification refer to the sale as an “auction,” reference bids, and state the contents of the storage unit go to the winning bidder. Given that we interpret the evidence in favor of plaintiff (Caloroso v. Hathaway, supra, 122 Cal.App.4th at p. 926), we find the lien sale was an auction for purposes of this appeal and address the merits of plaintiff‘s argument.
Section 2328 is comprised of four subdivisions. Under this statute, an auction is complete once announced by the auctioneer, referred to as the “fall of the hammer.” (
“The fundamental objective of statutory interpretation is to determine the Legislature‘s intent.” (County of San Bernardino v. Cohen (2015) 242 Cal.App.4th 803, 816.) The Legislature‘s focus in section 2328 is limited to the auction process itself, i.e., the process of selling and bidding on goods. This is clear from the text of the statute. Subdivision (1), which is irrelevant to this appeal, governs the sale of goods put up in lots. (
Contrary to plaintiff‘s assertion, nothing in section 2328 shows any intent by the Legislature to establish the grounds for voiding a completed sale, let alone the exclusive grounds. The only subdivision that even mentions voiding a completed sale is subdivision (4), which allows a buyer to void a sale due to improper bidding by the seller. But the focus of subdivision (4) is on integrity in the auction process, not the grounds for voiding a sale. Allowing a buyer to void the sale is only a remedy to address seller impropriety during the auction. Nothing in the text of the statute reasonably supports plaintiff‘s interpretation. If the Legislature had intended for this statute to establish the entire means for a buyer and seller to void a completed auction sale, it would have said so. “‘The Legislature “does not, one might say, hide elephants in mouseholes.“‘” (Jones v. Lodge at Torrey Pines Partnership (2008) 42 Cal.4th 1158, 1171.)
Further, even if this intent could somehow be read into section 2328, nothing in the statute‘s text bars the parties from agreeing to additional grounds for voiding a completed sale. (
b. Business and Professions Code section 21711
The Act contains various rules governing self-storage facilities, including lien sale procedure. With regard to lien sales,
Plaintiff reads too much into
In support of his interpretation, plaintiff cites Nist v. Hall (2018) 24 Cal.App.5th 40 (Nist). He argues the null and void clauses chill bidder participation, which violates the purpose of
In Nist, an occupant whose property had been erroneously sold brought a conversion claim against the buyer. (Nist, supra, 24 Cal.App.5th at pp. 43-44.) The occupant argued
Nist is inapplicable here. It involved a lawsuit filed by an occupant against a buyer, the very subject of
c. improper waiver under the Civil Code
Plaintiff also appears to contend the null and void clauses constitute an improper waiver of the rights established in section 2328 and
d. exercising the null and void clauses
Plaintiff only contests the facial validity of the null and void clauses. He does not dispute defendant‘s contention that it properly exercised the clauses if they are found to be valid. Nonetheless, we address defendant‘s contention and find it to be supported by the record. Less than an hour after the sale‘s completion, defendant determined it had mistakenly sold the contents of the unit, rescinded the sale, and attempted to fully refund plaintiff‘s money. This all occurred before plaintiff even began to remove any goods from the unit. Given these facts, defendant timely exercised the null and void сlauses in good faith. As such, its rescission of the sale is not a breach of contract or of the implied covenant of good faith and fair dealing.
However, this opinion should not be read as tacit approval of all null and void clauses that a storage facility owner may require bidders to accept. Similar clauses, or an owner‘s exercise of such a clause, may be invalid for reasons not contemplated herein. This opiniоn only finds that such clauses are not facially invalid based on section 2328 or
2. Economic duress
Next, plaintiff argues he consented to the null and void clauses under threat of economic loss. Refusal to accept the clauses would effectively bar him from participating in defendant‘s lien sales, which, he asserts, would cause
“The underlying concern of the economic duress doctrine is the enforcement in the marketplace of certain minimal standards of business ethics. Hard bargaining, ‘efficient’ breaches and reasonable settlements of good faith disputes are all acceptable, even desirable, in our еconomic system.” (Rich & Whillock, Inc. v. Ashton Development, Inc. (1984) 157 Cal.App.3d 1154, 1159.) But, the system disdains “the wrongful exploitation of business exigencies to obtain disproportionate exchanges of value. . . . The economic duress doctrine serves as a last resort to correct these aberrations when conventional alternatives and remedies are unavailing.” (Ibid.)
Economic duress requires an unlawful or “wrongful act which is sufficiently coercive to cause a reasonably prudent person facеd with no reasonable alternative to succumb to the perpetrator‘s pressure.” (Rich & Whillock, Inc. v. Ashton Development, Inc., supra, 157 Cal.App.3d at p. 1158.) “Examples of such ‘wrongful acts’ include ‘[t]he assertion of a claim known to be false or a bad faith threat to breach a contract or to withhold a payment . . . .‘” (Myerchin v. Family Benefits, Inc. (2008) 162 Cal.App.4th 1526, 1539, disapproved on other grounds by Village Northridge Homeowners Assn. v. State Farm Fire & Casualty Co. (2010) 50 Cal.4th 913, 929, fn. 6.)
Nothing in the record shows defendant did anything akin to a wrongful act. All participants must agree to the null and void clauses to participate in defendant‘s lien sales. The clauses are not unlawful under any of the statutes cited by plaintiff. And there is no evidence that defendant created this requirement for any coercive purpose or in bad faith or is exercising these clauses in such a manner. Instead, the record suggests the null and void clauses serve a practical business function. They allow defendant to avoid mistakenly selling its occupants’ possessions. For example, the delinquent sale agreement states defendant may void the sale if it “verifies that the tenant has paid the outstanding balance in full while the auction was taking place.” Similarly, here, defendant rescinded the sale soon after it learned the occupant had paid his past-due balance and the unit had been sold by error.
Plaintiff also appears to contend that it is wrongful for defendant to bar him from a public sale if he refuses to agree to the null and void clauses. However, “[a]bsent a legal provisiоn to the contrary, a private party generally may choose to do or not to do business with whomever it pleases.” (Drum v. San Fernando Valley Bar Assn. (2010) 182 Cal.App.4th 247, 254.) Plaintiff has not established an unqualified right to attend defendant‘s lien sales. While he cites In re Wallace (1970) 3 Cal.3d 289, for the proposition that he has the right to attend public events, this case is unpersuasive. Its analysis is limited to whether a specific petitioner‘s conviction of trespass under
Further, plaintiff has not established that he lacks a reasonablе alternative to accepting the null and void clauses. His assertion that he will lose 25 percent of his income is unsupported by the record. The record only establishes that 20 percent to 25 percent of the lien sales plaintiff attends are conducted by defendant. It does not necessarily follow that defendant‘s sales represent 25 percent of all of plaintiff‘s buying opportunities, much less 25 percent of his income. And even if this is true, if рlaintiff does not like the terms of defendant‘s sales, he could presumably make up for these lost buying opportunities elsewhere. Among other things, he could attend lien sales held by other self-storage facilities or purchase goods from other sources to resell. Plaintiff has not explained why these options are not reasonable alternatives.
3. Illusory provisions
Throughout his brief, plaintiff refers to defendant‘s unqualified right to void the sale as illusory. We decline to сonsider this argument. Plaintiff did not raise this issue with the trial court. (Pratt v. Union Pacific Railroad Co. (2008) 168 Cal.App.4th 165, 174.) Also, this argument is not stated under a separate heading and is not sufficiently developed. (T.P. v. T.W. (2011) 191 Cal.App.4th 1428, 1440, fn. 12.)3
C. The Conversion Claim
The trial court properly granted summary adjudication of plaintiff‘s conversion claim. ““Conversion is the wrongful exercise of dominion over the property of another. The elements of a conversion claim are: (1) the plaintiff‘s ownership or right to possession of the property; (2) the defendant‘s cоnversion by a wrongful act or disposition of property rights; and (3) damages.“” (Hernandez v. Lopez (2009) 180 Cal.App.4th 932, 939-940.)
As
D. Unlawful Detainer
Finally, plaintiff appears to contend that defendant was required tо use the unlawful detainer process (
We also reject this contention on its merits. Unlawful detainer statutes provide a “‘summary procedure for regaining possession of real property wrongfully withheld by a tenant.‘” (Deal v. Municipal Court (1984) 157 Cal.App.3d 991, 995, italics added; see
III
DISPOSITION
The judgment is affirmed. Defendant is entitled to its costs on appeal.
MOORE, ACTING P. J.
WE CONCUR:
ARONSON, J.
FYBEL, J.