Opinion
C097472
10-17-2023
GUILLON INC. CONSTRUCTION et al., Plaintiffs and Respondents, v. STEVEN GOMES, Defendant and Appellant.
NOT TO BE PUBLISHED
Super. Ct. No. 22CV01834
EARL, P. J.Code of Civil Procedure section 425.16 provides for the early dismissal of certain actions known as "strategic lawsuits against public participation" or SLAPP suits. Actions with "minimal merit" are not subject to early dismissal. (Navellier v. Sletten (2002) 29 Cal.4th 82, 94.) At issue in this appeal is whether the present action has the requisite minimal merit to proceed. Defendant and appellant Steven Gomes contends it does not, and he appeals from the trial court's denial of his motion to dismiss the action pursuant to section 425.16. We agree with the trial court's finding that the action has at least minimal merit, and thus affirm.
Further undesignated statutory references are to the Code of Civil Procedure.
FACTUAL AND PROCEDURAL BACKGROUND
Gomes worked for Guillon Inc. Construction (Guillon) on a construction project in Ukiah. In April 2020, he filed a claim against Guillon with the Labor Commissioner for unpaid wages, reimbursement of business expenses, and penalties. A hearing on the claim was scheduled for May 11, 2022 (all dates are in 2022).
On February 28, Guillon's attorney offered $8,066.57 to settle the claim. Gomes's attorney rejected the offer, but stated Gomes would accept $25,000. It appears negotiations initially ended there, with no settlement reached.
On April 4, Guillon's attorney sent two e-mails to Gomes's attorney. The first stated, "We'd like to reignite the negotiation process. [¶] Any ideas on how we can do that?" The second stated, "In fact, let's try this: [¶] If you can come down a bit on your demand for 25k I think we can get this done. [¶] Please advise."
On Monday, April 11, Gomes's attorney responded, "I will contact my client and get back to you." About one hour later, at 2:41 p.m., Gomes's attorney sent the following e-mail:
"My client is willing to accept $22,000 to settle the matter. He would need to be paid by the end of the week.
"Please let me know if your client is amenable to resolving the matter this way.
"I have limited availability this week, but could review a settlement . . . today or tomorrow if you prepare one."
At 3:59 p.m. that same day, Guillon's attorney responded, "Let me see what I can do."
Shortly after 10:00 a.m. the next morning, Tuesday, April 12, Guillon's attorney e mailed, "I think we have a deal. [¶] I'll send over a draft SA. [¶] Ok?" Gomes's attorney responded, "Sounds good."
Unbeknownst to Guillon's attorney, Gomes's attorney left for vacation the next morning, Wednesday, April 13. That afternoon, Guillon's attorney sent the following email:
"We are putting the finishing touches on a proposed settlement agreement 'SA.'
"My client is out of the country and we expect him back on Friday. Travel is difficult now and I am concerned about making promises I can't keep if there are delays in departures.
"I know we have agreed to a quick turn around; If we can't get a check out until early next week because I can't reach my client, will that work?
"Also, in my experience with regards to wage claims we usually prepare the SA to show a 60/40 split, re wages vs. penalties; meaning 60% is taxable as wages and 40% is attached to the penalties and not taxable. Will that work?
"Assuming your fees are 33% we can make three separate checks, one for fees (7,260), wages (8,844.00) and penalties ($5,896). Shall we do it like this or do you have another proposal?
"Also, to whom do we write the checks? All to your trust? To you and your client based on the splits above?
"Please identify the correct legal entities for your check.
Looking forward to hearing back from you."
Gomes's attorney did not respond until around noon on Sunday, April 17, when she sent the following e-mail:
"I appreciate your efforts to settle this matter.
"Unfortunately, as I mentioned in my earlier email, I was available only Monday and Tuesday of last week to work on this matter. I was away from email for the balance of the week, which is why I did not respond to your Wednesday message until now. In any case, my client was insistent that payment would have to have been made by Friday of last week, and would not have agreed to extend the deadline for the settlement amount we were contemplating last week.
"At this point my client prefers to wait for the Labor Commission decision, unless you would like to avoid the hearing and have a better offer to make. From his perspective, a better offer would be one that is higher than the $25k he offered before, and to be paid promptly."
Guillon's attorney immediately accused Gomes's attorney of bad faith and threatened to sue for breach of contract and to appeal any award issued by the Labor Commissioner, and communications devolved from there in ways that need not concern us.
The wage claim proceeded to a hearing before the Labor Commissioner on May 16. Following the hearing, the Labor Commissioner ordered Guillon to pay Gomes a total of $34,386.55 in unpaid wages and business expenses, penalties, and interest thereon.
Guillon has appealed the Labor Commissioner's order, but that appeal is not before us.
As threatened, Guillon filed a complaint against Gomes for breach of contract, breach of the implied covenant of good faith and fair dealing, and declaratory relief. All three claims are based on Guillon's allegation that, on April 12, the parties entered into a binding and enforceable contract to settle the wage claim for $22,000, and Gomes breached or repudiated that agreement in bad faith on April 17.
Gomes responded to the complaint by filing a special motion to strike pursuant to section 425.16. He argued all claims against him arose from an act in furtherance of his right to petition the government for redress of grievances. In particular, he argued the claims arose from statements made during settlement negotiations regarding his wage claim, which were "written or oral statement[s] or writing[s] made in connection with an issue under consideration or review by a[n] . . . executive . . . body, or any other official proceeding authorized by law" within the meaning of 425.16, subdivision (e). He also argued Guillon would not be able to establish a probability it would prevail on its claims because the evidence conclusively demonstrated there was no contract because Guillon's attorney's April 12 e-mail did not unequivocally accept Gomes's offer to settle for $22,000, and her subsequent email of April 13 regarding payment terms and timing further demonstrates the parties were still negotiating and had not yet reached an agreement. Alternatively, Gomes argued that even if a contract was formed, delivery of $22,000 by Friday, April 15, was a condition precedent, and when that condition failed, he was discharged from performing. In support of the motion, Gomes attached the parties' e-mails regarding settlement.
Guillon's opposition focused entirely on the merits of the claims. It argued Gomes's counsel's April 11 e-mail - "My client is willing to accept $22,000 to settle the matter" - was an offer, and a binding contract was formed on April 12 when its attorney accepted that offer by responding, "I think we have a deal. [¶] I'll send over a draft SA." It also argued its attorney's April 13 e-mail regarding payment terms and timing did not render the prior acceptance equivocal and did not add or change any material terms. Finally, it argued it had until the "end of the week," or until Sunday, April 17, to make payment, and it was excused from performing when Gomes repudiated the contract at noon on Sunday. Like Gomes, Guillon supported its opposition to the motion by attaching the parties' e-mails regarding settlement.
The trial court granted the motion in part and denied it in part. It first found that Gomes established all claims arose out of protected activity, particularly because Guillon did not argue otherwise, and that the burden thus shifted to Guillon to demonstrate a probability it would prevail on its claims.
The trial court then found Guillon met its burden as to the breach of contract and related declaratory relief claims. In particular, the trial court found it was undisputed that Gomes's attorney's April 11 e-mail ("My client is willing to accept $22,000 to settle the matter. He would need to be paid by the end of the week") was an offer. It then found that Guillon's attorney accepted that offer on April 12 by responding, "I think we have a deal," and that the parties thus formed a contract on that date. It rejected Gomes's argument that Guillon's counsel's April 13 e-mail rendered the acceptance equivocal, and instead found it was "a proposal to modify an existing contract." It also found the time specified for performance - i.e., "by the end of the week" (italics added)-was ambiguous, and it interpreted the phrase against Gomes because he had caused the ambiguity. Consequently, it construed "by the end of the week" to mean payment had to be made by Sunday, April 17. Finally, it found that Gomes repudiated the contract at around noon on April 17; that Guillon could still have rendered timely performance at that time; and that the repudiation thus constituted an anticipatory breach of contract.The trial court thus denied the motion to strike as to the breach of contract and declaratory relief claims. However, it granted the motion to strike the breach of covenant claim, finding it merely duplicated the breach of contract claim and was thus superfluous.
We presume the trial court found only that Guillon had established a probability of prevailing on its breach of contract claims, and did not mean to suggest it was deciding the merits of those claims in Guillon's favor.
Guillon did not appeal the order granting the special motion to strike the breach of covenant claim, and we thus do not discuss that claim further.
This appeal followed. (See § 904.1, subd. (a)(13) [an appeal may be taken "[f]rom an order granting or denying a special motion to strike under Section 425.16"].)
DISCUSSION
I
Section 425.16 and Standard of Review
Section 425.16, also known as the anti-SLAPP statute, is a procedural device for weeding out certain "meritless claims" at the early stages of litigation. (Baral v. Schnitt (2016) 1 Cal.5th 376, 384.) It provides, "A cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States Constitution or the California Constitution . . . shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." (§ 425.16, subd. (b)(1).) Courts frequently refer to acts in furtherance of a person's right of petition or free speech as "protected activity." (See Bonni v. St. Joseph Health System (2021) 11 Cal.5th 995, 1009; Park v. Board of Trustees of California State University (2017) 2 Cal.5th 1057, 1062.)
Evaluating an anti-SLAPP motion "requires the court to engage in a two-step" or "two-pronged" process. (Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 67, 66.) At the first step (or prong), the court must decide whether the moving defendant has met its burden of establishing the challenged claim arises from protected activity. (Id. at p. 61.) If the defendant fails to meet its burden, there is no need to proceed to the second step, and the motion must be denied. (City of Cotati v. Cashman (2002) 29 Cal.4th 69, 80-81.)
If the defendant meets its burden, the court proceeds to the second step, and must decide whether the plaintiff has met its burden of "establish[ing] that there is a probability [it] will prevail on the claim." (§ 425.16, subd. (b)(1).) The plaintiff's burden is not heavy, and it "need only establish that [its] claim has 'minimal merit' [citation] to avoid being stricken as a SLAPP." (Soukup v. Law Offices of Herbert Hafif (2006) 39 Cal.4th 260, 291.) In order to meet its burden, "the plaintiff must show both that the claim is legally sufficient and there is admissible evidence that, if credited, would be sufficient to sustain a favorable judgment." (McGarry v. University of San Diego (2007) 154 Cal.App.4th 97, 108.) Our Supreme Court explains, "We have described this second step as a 'summary-judgment-like procedure.' [Citation.] The court does not weigh evidence or resolve conflicting factual claims. Its inquiry is limited to whether the plaintiff has stated a legally sufficient claim and made a prima facie factual showing sufficient to sustain a favorable judgment. It accepts the plaintiff's evidence as true, and evaluates the defendant's showing only to determine if it defeats the plaintiff's claim as a matter of law. [Citation.] '[C]laims with the requisite minimal merit may proceed.'" (Baral v. Schnitt, supra, 1 Cal.5th at pp. 384-385, fn. omitted.)
"We review de novo the grant or denial of an anti-SLAPP motion." (Park v. Board of Trustees of California State University, supra, 2 Cal.5th at p. 1067.)
II
Analysis
The trial court found Gomes met his initial burden of showing the claims asserted against him arise out of protected activity, and Guillon agrees with this finding. Indeed, Guillon opens its brief by stating, "There is no dispute that the heart of the argument before this Court involves the second prong of the anti-SLAPP analysis, which requires that Plaintiff show admissible evidence regarding contract formation..... Appellant spends several pages of argument supporting arguments directed at the first prong of the Anti-SLAPP process, . . . which is not at issue here and thus Appellee will not address those arguments." We thus do not discuss the first prong further, and will assume - like the parties and the trial court - that the breach of contract claims arise out of protected activity.
We turn, then, to the focus of this appeal - namely, whether Guillon met its burden of showing a probability of prevailing on the merits of the breach of contract claims. As noted above, in order to meet its burden, Guillon "must show both that the claim is legally sufficient and there is admissible evidence that, if credited, would be sufficient to sustain a favorable judgment." (McGarry v. University of San Diego, supra, 154 Cal.App.4th at p. 108.) "It is, of course, basic hornbook law that the existence of a contract is a necessary element to an action based on contract." (Roth v. Malson (1998) 67 Cal.App.4th 552, 557.) Gomes argues Guillon cannot meet its burden because the only evidence of the existence of a contract is the e-mails exchanged by the parties' attorneys, and those e-mails conclusively demonstrate the parties never entered into a contract. Although we agree the evidence could support such a finding, we conclude it does not compel such a finding. We find the evidence could also support a contrary finding, namely that the e-mails demonstrate the formation of a contract.
Stripped of their nonessentials, the e-mails show the following:
On Monday, April 11, Gomes's attorney stated, "My client is willing to accept $22,000 to settle the matter. He would need to be paid by the end of the week. [¶] . . . [¶] I have limited availability this week, but could review a settlement . . . today or tomorrow if you prepare one."
The next day, Tuesday, April 12, Guillon's attorney stated, "I think we have a deal. [¶] I'll send over a draft SA. [¶] Ok?" Gomes's attorney responded, "Sounds good."
On Wednesday, April 13, Guillon's attorney asked, "If we can't get a check out until early next week . . ., will that work?" She also asked how the settlement amount should be split between wages and penalties, whether some portion should be paid directly to Gomes's attorney to cover her fees, and who the settlement check or checks should be made out to.
On Sunday, April 17, Gomes's attorney stated that the deal was off because "my client was insistent that payment would have to have been made by Friday of last week, and would not have agreed to extend the deadline for the settlement amount we were contemplating last week."
Based on this evidence, the trial court found the parties formed a contract on April 12, when Guillon's counsel accepted Gomes's counsel's offer to settle for $22,000. Although the issue is close, we find that a reasonable trier of fact could so find as well.
"Where the existence of a contract is at issue and the evidence is conflicting or admits of more than one inference, it is for the trier of fact to determine whether the contract actually existed. But if the material facts are certain or undisputed, the existence of a contract is a question for the court to decide." (Bustamante v. Intuit, Inc. (2006) 141 Cal.App.4th 199, 208, italics added.) Here, the evidence of contract formation consists entirely of the e-mails exchanged by the parties' attorneys and, in that sense, the evidence is undisputed. That does not necessarily mean, however, that the inferences to be drawn from that evidence are also undisputed. As noted above, the second step of the anti-SLAPP analysis has been described as a "summary-judgment-like procedure," (Baral v. Schnitt, supra, 1 Cal.5th at p. 384), and when ruling on a motion for summary judgment (or an anti-SLAPP motion), "we must consider all of the evidence and all of the inferences reasonably drawn therefrom, and we must view such evidence in the light most favorable to the opposing party. [Citation.] . . . [Citation.] [¶] A triable issue of fact exists when the evidence reasonably permits the trier of fact . . . to find the purportedly contested fact in favor of the party opposing the motion. [Citation.] [¶] . . . A material issue of fact may not be resolved based on inferences, if contradicted by other inferences or evidence. [Citations.] '[T]he court may not weigh the plaintiff's evidence or inferences against the defendants' as though it were sitting as the trier of fact,' but must determine the question of law of 'what any evidence or inference could show or imply to a reasonable trier of fact.' [Citation.] Where the evidence and inferences would allow a reasonable trier of fact to find the underlying fact in favor of a plaintiff in accordance with the applicable standard of proof, then a defendant's motion for summary judgment [or anti-SLAPP motion] must be denied." (Alexander v. Codemasters Group Limited (2002) 104 Cal.App.4th 129, 139.) Here, we find that the parties' e-mails "admit[] of more than one inference," which precludes us from finding as a matter of law that the parties never entered into a contract. (Bustamante, at p. 208.)
"An essential element of any contract is the consent of the parties, or mutual assent." (Donovan v. RRL Corp. (2001) 26 Cal.4th 261, 270.) "Mutual assent is determined under an objective standard applied to the outward manifestations or expressions of the parties, i.e., the reasonable meaning of their words and acts, and not their unexpressed intentions or understandings." (Alexander v. Codemasters Group Limited, supra, 104 Cal.App.4th at p. 141.) "The test is whether a reasonable person would, from the conduct of the parties, conclude that there was a mutual agreement." (Marin Storage &Trucking, Inc. v. Benco Contracting &Engineering, Inc. (2001) 89 Cal.App.4th 1042, 1050; see also Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 632 ["The question is what the parties' objective manifestations of agreement or objective expressions of intent would lead a reasonable person to believe"].)
Mutual assent is generally shown "through the medium of an offer . . . communicated to the offeree and an acceptance . . . communicated by the offeror." (1 Witkin, Summary of Cal. Law (11th ed. 2023) Contracts, § 117, italics added; see also Aton Center, Inc. v. United Healthcare Ins. Co. (2023) 93 Cal.App.5th 1214, 1231.) The trial court found, and the parties appear to agree, that Gomes's counsel's April 11 e-mail - "My client is willing to accept $22,000 to settle the matter. He would need to be paid by the end of the week" - was an offer, and we agree as well. (See Donovan v. RRL Corp., supra, 26 Cal.4th at p. 271 [" '" 'An offer is the manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it'"' "].) The question is: Was that offer accepted?
In his reply brief, Gomes suggests for the first time that it was not an offer when he states, without analysis or citation to authority, that his attorney's "initial communication . . . was so open ended that it is unclear if [she] even made an 'offer' that could be 'accepted.'" That is the extent of his discussion of this issue, and we note that in his motion papers below he consistently referred to the initial communication as an "offer." Assuming Gomes argues Guillon cannot establish an offer was made, we decline to consider this unsupported argument that was raised for the first time in the reply. (See Hurley v. Department of Parks & Recreation (2018) 20 Cal.App.5th 634, 648, fn. 10 [arguments not raised below or in an appellant's opening brief may be disregarded]; Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 956 [when an appellant fails to support point with reasoned argument and citation to authority, court may treat the point as waived].)
To be effective, "[a]n acceptance must be absolute and unqualified." (Civ. Code, § 1585; see also Ajax Holding Co. v. Heinsbergen (1944) 64 Cal.App.2d 665, 669 ["an acceptance must be unequivocal and positive and must comply with the terms of the offer"].) A qualified acceptance is a new proposal or a counteroffer which "constitutes a rejection of the original offer, and the original offer cannot thereafter be accepted by the offeree." (1 Witkin, Summary of California Law (11th ed. 2023) Contracts, § 185.) And, again, whether an offer has been accepted is determined by objective rather than subjective criteria, and the question is whether a person's words would lead a reasonable person to believe an offer had been accepted. (See Marin Storage &Trucking, Inc. v. Benco Contracting &Engineering, Inc., supra, 89 Cal.App.4th at p. 1050.)
Gomes argues that Guillon's counsel's statement "I think we have a deal" (italics added), was too equivocal to constitute an effective acceptance of the offer, and thus defeats a finding of contract formation. Although that is certainly one inference to be drawn from the statement, it is not the only inference, and a reasonable person could believe the offer had been accepted. This is particularly true where, as here, Guillon's counsel also stated, "I'll send over a draft SA. [¶] Ok?" and Gomes's counsel immediately responded, "Sounds good." Viewing this e-mail exchange in its entirely, we find that a reasonable person could believe the parties had a deal. Moreover, as Guillon notes, "A well-established principle of contract law [provides that] when parties agree on the material terms of a contract with the intention to later reduce it to a formal writing, failure to complete the formal writing does not negate the existence of the initial contract. [Citations.] If the parties do not agree on the content of the formal writing (for example because one party wants to include something not agreed on in the first place . . .), the proposed writing is not a counteroffer; rather, the initial agreement remains binding and a rejected writing is a nullity." (CSAA Ins. Exchange v. Hodroj (2021) 72 Cal.App.5th 272, 276.) We find a reasonable person could conclude in this case that the parties agreed on the material terms of the settlement (i.e., payment of $22,000 by the end of the week) with the intention of reducing that agreement to a formal writing, but that the failure to complete the formal writing does not negate the existence of a contract.
Gomes argues CSAA Ins. Exchange is factually distinguishable because the offer in that case was more detailed and the acceptance unequivocal. We agree that CSAA Ins. Exchange is factually distinguishable - so much so that the court in that case held the parties' written settlement communications resulted in a binding contract and "[n]o reasonable trier of fact would find otherwise." (CSAA Ins. Exchange v. Hodroj, supra, 72 Cal.App.5th at p. 277.) We make no such finding here. Instead, we make the much more limited finding that a reasonable trier of fact could find the parties' e-mail communications resulted in a binding contract, but that it could also find those communications were too equivocal to result in a binding contract. As a result, we agree with the trial court that Guillon has met its "minimal burden under the anti-SLAPP statute," and Gomes's motion to strike was thus properly denied. (Bently Reserve LP v. Papaliolios (2013) 218 Cal.App.4th 418, 435.)
We do not find this appeal frivolous, and thus deny Guillon's request for sanctions pursuant to section 128.5.
DISPOSITION
The trial court's order partially denying Gomes's special motion to strike is affirmed. Guillon is to recover its costs on appeal. (Cal. Rules of Court, rule 8.278(a)(1), (2).)
We concur: RENNER, J., MESIWALA, J.