Preview
1 Todd A. Jones (BarNo. 198024)
Gregory K. Federico (Bar No.,242184)
2 ARCHERNORRIS
A Professional Law Corporation
3 301 University Avenue, Suite 110
Sacramento, Califomia 95825
4 Telephone: 916.646.2480
Facsimile: 916.646.5696
5
Attomeys for Defendants
6 RICHARD KIRK RUYBALID, individually and
dba CA CONSTRUCTION
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8 SUPERIOR COURT OF CALIFORNIA
9 COUNTY OF SACRAMENTO
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11 RODNEY ABBOTT and FLORENTINE CaseNo. 07AS04450
ABBOTT,
12 CA CONSTRUCTION'S SUPPLEMENTAL
Plaintiffs, BRIEF REGARDING ELECTION OF
13 REMEDIES; COST OF REPAIR VERSUS
DIMINUTION IN VALUE
14
RONALD PAUL BRITSCHGI, et al. Action Filed: September 24,2007
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Defendants. Hearing Date; January 14,2011
16 Trial Date: January 18,2011
Time: 8:30 a.m.
17 Location: Department 43
18 AND ALL RELATED CROSS-ACTIONS.
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20 Pursuant to the Court's order at the January 7, 2011 hearing on the motions in limine.
21 Defendant RICHARD KIRK RUYBALID, individually and dba CA CONSTRUCTION
22 (hereinafter "CA CONSTRUCTION") hereby submits this Supplemental Brief Regarding
23 Plaintiffs FLORENTINE and RODNEY ABBOTTs (hereinafter "Plaintiffs") Election of
24 Remedies; Cost of Repair versus Diminution in Value.
25 This request for additional briefing stems from CA CONSTRUCTION'S Motion in
26 Limine No. 5 in which it requested that this Court exclude evidence pertaining to Plaintiffs'
27 emotional distress damages. Plaintiffs opposed the motion and argued that they should be
28 allowed to put on evidence to establish the special purpose exception to the general rule of
NIC549/1075025-1
SUPPLEMENTAL BRIEF REGARDING ELECTION OF REMEDIES; COST OF REPAIR VERSUS
DIMINUTION IN VALUE
1 damages. Specifically, Plaintiffs wish to introduce evidence ofthe emotional impact ofthe
2 alleged damages to their home, that they built the home for special familial reasons, and their
3 desire to affect repairs to the home based on these special familial reasons. In its reply, CA
4 CONSTRUCTION argued that Plaintiffs must make an election of remedies. That is, PlaintifFs
5 must choose either the cost of repair or diminution in value, and that they were not entitled to
6 both. The Court granted CA CONSTRUCTION'S motion evidence pertaimng to Plaintiffs'
7 emotional distress damages, but indicated that Plaintiffs could put on evidence to establish the
8 special purpose exception to the generai rule. At the January 7,2011 hearing. Plaintiffs argued
9 that they shoixld be permitted to introduce evidence ofboth during trial. The Court requested
10 additional briefing on the issue.
11 IL
ARGUMENT
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A. The General Rule For The Measure Of Damages Applicable To Injury To
13 Real Property Is Diminution In Value Or Cost of Repair, Whichever Is Less.
14 In a case involving damage to plaintiffs property due to defendant's negligence, the
15 general mle is that ifthe cost of repairing the injury and restoring the premises to their original
16 condition amounts to less than the diminution in value ofthe property, such cost is the proper
17 measure of damages; and if the cost of restoration will exceed such diminution in value, then the
18 diminution in value ofthe property is the proper measure {Green v. General Petroleum Corp.
19 (1928) 205 Cal. 328, 336; Charles v. Reuck (1960) 179 Cal.App.2d 145,147; Basin Oil Co. v.
20 Baash-Ross Tool Co. (1954) 125 Cal.App.2d 578, 606; Kell v Jansen (1942) 53 Cal.App.2d 498,
21 503; See also Mozzetti v. City of Brisbane (1977) 67 Cal.App.3d 565 (where the general mle that
22 "plaintiff is allowed to recover either the cost of repair or the diminution in value, but not both"
23 originated and Ferraro v. Southern Cal Gas Co (1980) 102 Cal.App.3d 33,49 holding that it is
24 generally appropriate to use the lesser ofthe two measures).) Distilled to its essence, this general
25 mle is a limitation on damages. {Kelly v. CB&I Construction, Inc (2009) 179 Cal.App.4* 442,
26 450.
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N1C549/1075025-1
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SUPPLEMENTAL BRIEF REGARDING ELECTION OF REMEDIES, COR VS. DIMINUTION IN VALUE
Restoration costs may be awarded for tortious injury to property even though they exceed
the decrease in market value if there is a reason personal to the owner for restoring the original
condition. {Heninger v. Dunn (1980) 101 Cal.App.3d 858). Departure from the usual damages
rule by allowing recovery of cost of repair to property damaged by negligence even when it
exceeds diminution in value is permitted when plaintiff can show that loss in value to him is
greater than diminution in value and that repairs will definitely be made. {Safeco Ins. Co. v. J &
D Painting (1993) 17 Cal.App.4* 1199). The threshold to satisfy the personal reason exception is
for Plaintiffto establish some personal use by them and a bona fide desire to repair or restore.
(See generally Orndorffv. Christiana Community Builders (1990) 217 Cal.App.3d 683, 688).
However, there are some restrictions in the application ofthe personal reason exception.
For instance, repair costs are allowed only if they are reasonable in light ofthe value ofthe real
property before the injury and the actual damage sustained. {Housely v. City ofPoway (1993) 24
Cal.Rptr. 2d 554, 559 (".. .where the owner has a personal reason to repair the damage, and the
cost of repair is not unreasonable in relation to the value ofthe land and the damage inflicted cost
of repair can be recovered even though it is higher than diminution in value").
In its reply brief in support of Motion in Limine No. 5, CA CONSTRUCTION has raised
the issue of Plaintiffs selecting a remedy for good reason. Plaintiffs' home located at 8601
Rolling Green Way in Fair Oaks, Califomia is currently in foreclosure. The house was originally
up for sale at a public auction on December 22, 2010. The sale date was continued to January 24,
2011, approximately five (5) days into the current trial. (Please see the Notice of Trustee's Sale
attached as Exhibit "A" to the Declaration of Gregory K. Federico). We are advised that the
Trustee's Sale will proceed on this date.
The fact that the home is in foreclosure is important to the current action for several
NIC549/1075025-1 3
SUPPLEMENTAL BRIEF REGARDING ELECTION OF REMEDIES; COR VS. DIMINUTION IN VALUE
1 reasons. First, if the house is.sold on January 24,2011, Plaintiffs will no longer own the home
2 for which they seek damages stemming from alleged constmction defects. This would occur
3 during the trial. In essence, they will no longer have standing to pursue construction defect
4 claims because they would no longer be the real party in interest. The bank would be the real
5 party in interest.
6 Second, the fact that the home is currently in foreclosure is relevant to Plaintiffs' measure
7 of damages. The analysis for a plaintiff ovraer of a foreclosed home is that the plaintiff still owns
8 the cause of action, but the damages are now wholly speculative, because plaintiff neither has the
9 ability to repair the defects, nor will plaintiff ever incur the cost to do so. See Frustuck v. City of
10 Fairfax (1963) 212 Cal App.2d 345,367. Similarly, the altemate measure of damages -
11 diminution in value — is not applicable where plaintiff lost the home in foreclosure, as opposed to
12 selling the property at a loss. See Mozzetti v Brisbane {1971) 67 Cal. App.3d 565. Plaintiffs'
13 potential loss of their property would not be voluntary and it would not result in any injury to the
14 property. Rather, Plaintiffs' monetary/property loss is due to their failure to pay the mortgage.
15 Once this occurs, the defects in the home are irrelevant, because they will have no impact on the
16 foreclosure. Thus, while plaintiffs may have had pre-foreclosure damages due to defects, the
17 foreclosure essentially breaks the chain of causation, and changes the nature of Plaintiffs' injury.
18 If foreclosure occurs, Plaintiffs' damage claims are irrelevant and should be inadmissible at trial.
19 Third, the procedural issues raised by the foreclosure fiarther compound the case. Ifthe
20 bank takes Plaintiffs' home on January 24,2011, or sometime prior to judgment, a risk of
21 multiple suits and inconsistent liability findings exists. Also, CA CONSTRUCTION has no idea
22 whether Plaintiffs have provided their lender with notice ofthis action, the claims at issue, and
23 provided the lender with an opportunity to join in the action.
24 Finally, and most importantly, evidence that the home is in foreclosure is relevant to
25 refute Plaintiffs' personal exception claim. Plaintiffs claim a true desire to repair the home
26 because they have a personal reason to restore the original condition ofthe home. The possibility
27 exists that since the home is in foreclosure and not current on its mortgage. Plaintiffs have no
N1CS49/1075025-1 4 & &>
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SUPPLEMENTAL BRIEF REGARDING ELECTION OF REMEDIES; COR VS. DIMINUTION IN VALUE
1 desire to affect repairs and v^ll simply let the bank take the home once judgment is rendered.
2 CA CONSTRUCTION is cognizant that this evidence carries some prejudicial impact for
3 Plaintiffs. However, Plaintiffs must establish that the prejudicial value is substantially outweighed
4 by the danger of undue consumption oftime, confusion ofthe issues, and that it will mislead the
5 jury. This evidence will clarify damages issues for the jury because it will limit the damages
6 available to Plaintiff. This evidence will also assist the trier of fact in determining whether
7 Plaintiffs have a tme desire to affect repairs to this home. Any prejudicial impact ofthe evidence
8 can be fiarther reduced by proper limiting instmctions to the jury. At a minimum, the Court should
9 monitor the status ofthe foreclosure sale as there is a real possibility that Plaintiffs will no longer
10 own the home during the pending trial.
11 C. CA Construction Requests That The Jury Receive All Appropriate Jury
Instructions On the Proper Measure Of Damages Based On Injury To Real
12 Property
13 The doctrine of election of remedies is based up>on the principle of estoppel. {Steiner v.
14 Rowley (1950) 35 Cal. 2d 713). A party having two or more coexisting modes of procedure and
15 relief allowed by law on the same state of facts, one of which is inconsistent with the other, may
16 not pursue both but must choose between them, and when, with knowledge ofthe facts, he has
17 clearly elected to proceed upon one, he is thereby bound and will be estoppedfi-ominvoking the
18 other. {Calhoun v Calhoun (1947) 81 Cal.App.2d 297.) A party is therefore required to make a
19 timely election of remedies. {Steiner, supra, at 720). While an election must be made, this
20 requirement can be done at anytime before the judgment is rendered and entered. {Klinger v
21 Modesto Fruit Co (1930) 107 Cal.App. 97, 102).
22 Although Plaintiff can make fhe election anytime before thejudgment is rendered or
23 entered, the Court must protect CA CONSTRUCTIONfiromundue prejudice that may result from
24 duplicative damage evidence. CA CONSTRUCTION is concemed that in making such an award
25 the jury might consider evidence regarding both the cost of repair and diminution in value ofthe
26 property. This computation allows recovery cumulatively for both the cost of repair and
27 diminution in value, which is clearly improper. While Plaintiffs evidence regarding both cost of
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SUPPLEMENTAL BRIEF REGARDING ELECTION OF REMEDIES; COR VS. DIMINUTION IN VALUE
1- repair and diminution in value has the potential of confiasing the jury, this risk can be minimized
2 by a proper jury instmction. The Judicial Council ofCalifomia Civil Jury Instmctions, 3903F
3 instructs fhe jury on how to properly calculate any such award and, as a result, minimizes this
4 potential risk for confusion that may result m an improper calculation of damages, CA
5 CONSTRUCTION proposes the use of this jury instmction and that the instmction be submitted
6 to the jury to ensure any potential award is calculated properly.
7 ni.
CONCLUSION
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Based on the foregomg, CA CONSTRUCTION requests that the jury receive all
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appropriate instmctions on the proper measure of damages as dictated by the evidence put forth
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by the parties during trial. CA CONSTRUCTION also requests that the jtuy be permitted to
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receive evidence pertaining to Plaintiffs' pending foreclosure, subject to all appropriate limiting
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instmctions.
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14 Dated: January 12, 2011 ARCHERNORRIS
15
16
Gregory K. Federico
17 Attomeys for Defendants RICHARD KIRK
RUYBALID, individually and dba CA
18 CONSTRUCTION
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SUPPLEMENTAL BRIEF REGARDING ELECTION OF REMEDIES; COR VS. DIMINUTION IN VALUE
1 PROOF OF SERVICE
2 Name of Action: Rodney Abbott, et al. v. Ronald Paul Britschgi, et al.
Court and Action No: Sacramento County Superior No. 07AS04450
3
I, Cindy A. Ingland, declare that I am over the age of 18 years and not a party to this
4 I action or proceeding. My business address is 301 University Avenue, Suite 110, Sacramento,
Califomia 95825. On January 12, 2011,1 caused the following document(s) to be served:
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CA CONSTRUCTION'S SUPPLEMENTAL BRIEF REGARDING ELECTION OF
6 REMEDIES; COST OF REPAIR VERSUS DIMINUTION IN VALUE
7 1x1 By placing a tme copy ofthe documents listed above, enclosed in a sealed envelope,
addressed as set forth below, for collection and mailing on the date and at the business
° address shown above following our ordinary business practices. I am readily familiar
Q -with this business' practice for collection and processing of correspondence for
mailing with the United States Postal Service. On the same day that a sealed envelope
10 is placed for collection and mailmg, it is deposited in the ordinary course of business
with the United States Postal Service with postage fully prepaid.
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^ By havmg a tme copy of the document(s) listed above transmitted by facsimile to the
12 person(s) at the facsimile number(s) set forth below before 5:00 p.m. The transmission
._ was reported as complete "without error by a report issued by the transmitting facsimile
machine.
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j j By placing a tme copy ofthe document(s) listed above, in a box or other facility
15 regularly maintained by UPS, an express service carrier, or delivered to a courier or
driver authorized by the express service carrier to receive doctoments, in an envelope
16 designated by the express service carrier, with delivery fees paid or provided for,
addressed as set forth below.
18 n l^v ha'vine personal deliverv bv FIRST LEGAL SUPPORT SERVICES a tme copv of
the document(s) listed above, enclosed in a sealed envelope, to the person(s) and at the
19 address(es) set forth below.
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[SEE ATTACHED SERVICE LIST]
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I declare under penalty of peijury that the foregoing is tme and correct. Executed on
22 January 12, 2011, at Sacramento, Califomia.
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INDY A. INGLAND
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NIC341/608293-1
PROOF OF SERVICE
1 Service List
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Stephanie Finelli PLAINTIFFS
3 Law Offices of Stephanie J Finelli
1007 Seventh Street, Suite 500 Tei'(916) 443-2144
4 Sacramento, CA 95814 Fax:(916)443-1511
E-mail' sfinelli700@yahoo com
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Richard D. Sopp Counsel for CADRE DESIGN GROUP, INC.
6 Wheatley Sopp LLP
1004 River Rock Drive, Suite 245 Tel. (916) 988-3857
7 Folsom, CA 95630 Fax:(916)988-5296
Email, rds@mwsblaw.com
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Mark Smith In Pro Per
9 8549 Willow Valley Place
Granite Bay, CA 95746
10 markdarlenesmith@gmail.com
11 Richard W. Freeman Counsel for R4C0RP
Scott S. Brooks
12 WOOD SMITH HENNING & BERMAN LLP Tel. (925) 356-8200
1401 Willow Pass Road, Suite 700 Fax: (925) 356-8250
13 Concord, CA 94520-7982
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NJC341/608293-1
SERVICE LIST