Opinion
G056542 G057072
03-12-2020
ESTHER J. KIM, Plaintiff, Cross-defendant and Appellant, v. CHERYL ESTEP et al., Defendants, Cross-complainants and Appellants.
Law Office of Alan S. Yockelson, Alan S. Yockelson and Mark Bradley Wilson for Plaintiff, Cross-defendant and Appellant. Higgs Fletcher & Mack, John M. Morris, Phillip Constantin Samouris and Rachel Moffit Garrard for Defendants, Cross-complainants and Respondents.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super. Ct. No. 30-2016-00874028) OPINION Appeal from a judgment of the Superior Court of Orange County, Gregory H. Lewis, Judge. Affirmed. Law Office of Alan S. Yockelson, Alan S. Yockelson and Mark Bradley Wilson for Plaintiff, Cross-defendant and Appellant. Higgs Fletcher & Mack, John M. Morris, Phillip Constantin Samouris and Rachel Moffit Garrard for Defendants, Cross-complainants and Respondents.
* * *
Plaintiff Esther J. Kim, a former pharmacist, convinced her friend, defendant Cheryl Estep, to invest $650,000 in her pharmacy for a 49 percent ownership interest. Unknown to defendant and before her initial investment, the state pharmacy board (Board) had been inspecting the pharmacy for various pharmacy law violations under plaintiff's leadership. Plaintiff ultimately was forced to surrender her pharmacist license and sell the pharmacy. On behalf of the pharmacy, plaintiff entered into a written agreement with defendant's company whereby defendant's company purchased all of the pharmacy's assets for $1. The written agreement contained an integration clause. Plaintiff later demanded that defendant pay more than $1 pursuant to a valuation of the pharmacy. After defendant refused, plaintiff brought the instant action alleging the parties had an oral agreement that they would conduct a valuation of the pharmacy and defendant would pay accordingly.
Defendant cross-complained and alleged, among other things, that plaintiff intentionally concealed the Board's investigation and that she would not have invested in the pharmacy if those facts had been disclosed. Defendant's company also filed a complaint in intervention.
The case proceeded to trial. At the close of plaintiff's case in chief, the court granted a motion for nonsuit filed by defendant and her company. The court found there was no reason for plaintiff's claims to go to a jury because the parol evidence rule precluded evidence of the parties' alleged oral agreement to conduct a valuation of the pharmacy. On appeal, plaintiff contends the court erred because several exceptions to the parol evidence rule applied, including Evidence Code section 622, ambiguity, and fraud. She also claims the written agreement between the parties was not a valid contract. We disagree. The exceptions that plaintiff raises do not apply to the instant case. And even assuming the court erred by precluding parol evidence, any error was harmless.
After the close of defendant's case on the cross-complaint, the jury returned a verdict in favor of defendant and her company. The court denied in part plaintiff's motion for judgment notwithstanding the verdict (JNOV motion) and motion for new trial. But the court modified the judgment on the cross-complaint to delete an award of $250,000 on defendant's cause of action against plaintiff for intentional interference with contractual relations.
Plaintiff argues the court erred by denying her JNOV motion and motion for new trial because there was insufficient evidence to support the jury's damages award or the jury's finding that plaintiff intentionally concealed facts regarding the State Pharmacy Board's investigation. She also argues the court abused its discretion by allowing excerpts from her videotaped deposition to be played during defendant's opening statement. Finally, she asserts the court abused its discretion by refusing to admit into evidence a letter from the Food and Drug Administration (FDA) to defendant's company.
Defendant also cross-appeals and contends the court erred by modifying the judgment to delete the jury award on defendant's cause of action for intentional interference with contractual relations. For the reasons below, we disagree with both parties' contentions and affirm the judgment.
FACTS
The Sale of the Pharmacy and the State Pharmacy Board Inspections
Plaintiff was the owner and pharmacist in charge of a compounding pharmacy called Innovative Compounding Solutions, LLC doing business as Heritage Compounding Pharmacy (Heritage or the pharmacy). She and defendant, who was plaintiff's State Farm Insurance agent, became friends and discussed whether defendant should invest in Heritage. Defendant undertook to learn more about compounding pharmacies by visiting Heritage at different times, reviewing profit and loss statements, visiting other compounding pharmacies, and discussing the potential investment with plaintiff's attorney. Around April or May 2013, plaintiff and defendant entered into a purchase and sale agreement (PSA) whereby defendant paid $650,000 to plaintiff for a 49 percent ownership interest in Heritage.
In the year before defendant became an investor, the Board inspected Heritage on five different occasions due to an employee's complaint about illegal activity taking place at the pharmacy. The inspections resulted in Board reports that were kept in a binder available to all pharmacy staff. In February 2013, the Board generated a report with questions for plaintiff to answer regarding violations of pharmacy regulations. Defendant attached the responses plaintiff prepared, prepared a fax cover sheet, and sent the responses back to the Board.
The Board inspections resulted in a formal accusation filed against plaintiff and Heritage in January 2014, less than a year after defendant's investment. The accusation detailed "cause[s] for discipline," including, among other things, plaintiff's furnishing of dangerous drugs without a valid prescription, "writing, filling, compounding, issuing, and dispensing false prescriptions or prescriptions containing fictious physician information," dispensing or refilling an expired prescription, falsifying documents, and administering B-12 injections "even though [Heritage was] not a licensed health care facility."
After the accusation was filed, plaintiff told defendant that a disgruntled employee was trying to "blackmail" her by making false claims to the Board. But plaintiff eventually entered into a stipulated surrender of license with the Board and admitted culpability for the allegations against her. She also agreed to surrender her pharmacist license, give up working at Heritage, and close or sell Heritage within 60 days.
Within the next 60 days, Heritage and defendant's company, Precision Pharmacy Center, LLC (Precision), entered into an asset purchase agreement (APA), whereby Heritage agreed to sell all of its assets to Precision. The APA stated "[t]he purchase price for the assets is $1.00." The APA also included the following integration clause: "This Agreement constitutes the sole and only agreement between [Precision] and [Heritage] respecting the Business or the sale and purchase of it. This Agreement correctly sets forth the obligations of [Precision] and [Heritage] to each other as of its date. Any additional agreements or representations respecting the Business or its sale to [Precision] not expressly set forth in this Agreement are null and void, unless otherwise required by law. Both parties agree to waive rights as to any conflicting laws which may nullity this Agreement to the full extent allowable by law." (Italics omitted.)
A few weeks later, the parties also executed a bill of sale, which stated that plaintiff and Heritage sold all of Heritage's assets to defendant and Precision "[f]or and in consideration of the sum of $1.00 U.S. Dollar . . . ." The bill of sale further stated: "The parties hereby agree to execute such other documents and perform such other acts as may be necessary or desirable to carry out the purposes of this Bill of Sale."
Over the following months, a dispute arose between plaintiff and defendant about whether defendant owed more than $1 for purchasing the assets of Heritage. Plaintiff requested more money, claiming the APA was not complete until there was an appraisal of the pharmacy. After defendant refused to pay any additional money, plaintiff attempted to re-sell her own interest in Heritage to Hummingbird Data Systems, LLC (Hummingbird), a company owned by Walter Cline. Cline then communicated with defendant, claiming that the bill of sale was void and that defendant was required to conduct a valuation of Heritage whereby defendant would have to purchase Cline's interest or sell her own interest. Defendant did not agree to Cline's demands and eventually closed Heritage, selling its inventory for $30,000. The Complaint, Cross-complaint, and Complaint in Intervention
In September 2016, plaintiff, Cline, and Hummingbird filed a complaint against defendant alleging causes of action for declaratory relief, breach of written contract, breach of implied contract, breach of the implied covenant of good faith and fair dealing, unfair business practices, breach of fiduciary duty, and breach of the duty of loyalty. Despite the APA whereby Heritage agreed to sell its assets for $1, the complaint alleged the parties had an understanding that the pharmacy would not be sold for $1. Relying on the bill of sale that said the parties would perform "'other acts,'" the complaint alleged "the 'other acts' would include a formal valuation of [Heritage,] and [defendant's] purchase of [plaintiff's] remaining shares of [Heritage] for a fair and equitable price."
In response, defendant filed a cross-complaint against plaintiff alleging causes of action for concealment, breach of the PSA, and breach of the APA. Among other things, defendant alleged plaintiff "failed to disclose and actively concealed the Board's investigation and findings [regarding Heritage] from [defendant] prior to entering into the Purchase and Sale Agreement . . . and collecting $650,000 from [defendant]." (Italics omitted.) With respect to the breach of contract claims, defendant alleged plaintiff breached the PSA by failing to indemnify defendant for losses related to the Board's investigation. Defendant further alleged plaintiff breached the APA by wrongfully denying its existence and claiming she had not sold the Heritage assets. The cross-complaint also asserted a cause of action for intentional interference with contract against Cline and Hummingbird. Defendant alleged they intentionally interfered with the APA by improperly entering into another agreement whereby plaintiff purported to sell her interest in Heritage to Hummingbird even though plaintiff had already transferred all of Heritage's assets to Precision. According to defendant, they also intentionally interfered with the APA by demanding a valuation from defendant.
Precision then filed a complaint in intervention alleging causes of action for breach of the APA and conversion against plaintiff and a cause of action for intentional interference with contract against Cline and Hummingbird.
Because the conversion claim is not at issue in this appeal, we do not summarize those allegations.
Motions in Limine and Plaintiff's Videotaped Deposition Testimony
Before trial, defendant and Precision filed several motions in limine. Two of those motions are at issue in this appeal. In the first motion, defendant and Precision argued the APA, which provided a $1 purchase price, was an integrated agreement and plaintiff's suggestion that the parties agreed to a different price pursuant to an appraisal process contradicted the APA. Relying on the parol evidence rule, they sought to exclude evidence of the "'under-the-table' agreement that [d]efendant would pay additional consideration . . . for the assets of the pharmacy, in direct contradiction of the parties' written agreement." The court denied the motion and determined it was "more properly brought up at the conclusion of the evidentiary [phase] as a nonsuit."
The second motion sought to exclude evidence relating to post-sale communications with the FDA. Defendant and Precision argued their post-sale communications with the FDA were irrelevant because "purported violations of pharmacy law in 2016 by [defendant] or Precision . . . have no impact on the value of the pharmacy in 2015, which is the relevant period." They also argued the communications would be unduly prejudicial and time consuming. The court granted the motion, finding the evidence was "[t]otally irrelevant."
Defendant and Precision also filed a notice of intent to introduce excerpts of plaintiff's videotaped deposition at trial. Plaintiff objected, but the court found defendant and Precision could introduce the deposition excerpts because an "adverse party, can use any portion of the deposition if they choose . . . ."
Trial and Motion for Nonsuit
At trial, plaintiff's counsel continued to argue the APA was not an integrated agreement. Although the agreement included an integration clause, plaintiff's counsel argued "we know that's wrong, because . . . the parties went ahead and executed another document, the Bill of Sale." According to plaintiff's counsel, the bill of sale indicated "the parties are to execute other documents and other terms [so] that tells me it's not an integrated agreement." Given this language in the bill of sale, plaintiff's counsel argued the parol evidence rule did not bar "conversations, agreements, negotiations, [or] course of conduct" occurring after the parties entered into the APA.
The court disagreed, explaining, "[T]he presence of the integration clause . . . which is in the agreement, the Asset Purchase Agreement is effective. There are no modifications that exist in law, that the court will allow particularly in the presence of the integration clause. It's a fully integrated document." Defendant and Precision accordingly moved for nonsuit at the close of plaintiff's case in chief, arguing "the facts presented cannot, as a matter of law, satisfy the legal elements of any of the claims" because of the parol evidence rule. Their counsel explained, "In sum, what the plaintiffs are saying is that the parties entered into the Asset Purchase Agreement . . . likewise, the Bill of Sale . . . [a]nd that although it's been signed and fully performed . . . there was a side agreement, an oral side agreement, . . . that there would be an appraisal done and additional monies paid. [¶] And your honor has already given us his ruling, if you will, on the application of the parol evidence rule."
The court granted the motion for nonsuit and found "the parol evidence [rule] rightfully controls the effects of the evidence in this case, and as such . . . there is no basis for any evidence of sufficient substantiality on any of these causes of action to go to the jury."
During defendant's case in chief on the cross-complaint, defendant testified that plaintiff did not tell her about the Board's investigation regarding illegal activities at Heritage before defendant invested $650,000 in Heritage. She also testified that plaintiff had begged her to take over Heritage after the Board's accusation. According to defendant, she agreed and entered into the APA, but plaintiff later came back and asked for more money. She testified she gave in to plaintiff's demands for a valuation to "get [plaintiff] to leave [her] alone, to show [plaintiff] that there was no value of the pharmacy at that time . . . ."
Jury Verdict
The jury returned a verdict on the cross-complaint in favor of defendant and Precision and awarded: (1) $443,000 to defendant on the concealment claim; (2) $100,000 for past economic loss to defendant based on the claim for breach of the PSA; and (3) $44,558 to Precision on the conversion claim. Although the cross-complaint and complaint in intervention did not allege a claim for interference with contract against plaintiff, the parties litigated the claim as if it was alleged against plaintiff. The jury accordingly awarded $250,000 to Precision for the intentional interference with contract claim against plaintiff and $150,000 to Precision for the same claim against Cline.
Although the cross-complaint alleged a claim for breach of the APA, defendant did not pursue that claim at trial.
JNOV Motion and Motion for New Trial
After judgment was entered, plaintiff filed a JNOV motion and a motion for new trial. In the JNOV motion, plaintiff argued she could not be liable for interference with the APA to which she was a party. She also asserted the evidence did not support a finding of intentional concealment or damages.
Plaintiff raised the same arguments in her motion for new trial and further argued the court should have admitted into evidence a 2016 FDA letter to Precision and that excerpts from her videotaped deposition should not have been played to the jury during defendant's opening statement. She also claimed the court erred by granting nonsuit on her complaint and should have admitted parol evidence proving the "total agreement" between the parties, which allegedly included an agreement that defendant would pay additional money to plaintiff pursuant to a valuation of Heritage. Among other things, she argued parol evidence was admissible under the fraud exception because her answer to the cross-complaint alleged the affirmative defense of fraud in the inducement.
In support of her argument regarding parol evidence, plaintiff submitted evidence of various e-mail communications between the parties after the APA was signed in February 2015. Almost all of these were introduced at trial or were included in the parties' joint trial exhibit list. For example, in March 2015, defendant sent an e-mail to plaintiff's attorney stating she and plaintiff were "in the process of finalizing the books for the pharmacy" and requesting "how much [the attorney] would charge . . . to help . . . resolve the value of the pharmacy." The next day, plaintiff sent an e-mail to her attorney and defendant, stating she and defendant wanted "to come to [a] final conclusion and fair purchase agreement" and asking how much the attorney would charge to "derive the pharmacy value." Defendant then sent an e-mail to plaintiff's attorney stating, "Obviously this is not a traditional sale. There are many factors that affect the valuation of Heritage. Before we go any further, are you interested in assisting us and if so how much would you charge?"
In May 2015, defendant sent an e-mail to plaintiff and said she refused to pay more than she had already paid. Defendant explained she had paid $650,000 based on Heritage's average gross sales but eventually learned the pharmacy's business model was not sustainable because of prior "insurance billing practices." She further said the "demise of the pharmacy" due to the Board's action "was of no fault of [hers]" and that "[i]t was all related to things that happened prior to [her] involvement in the pharmacy and things that [she] had no knowledge of at the time [she] bought in." She also said the pharmacy had "zero profit" over the last five months, requiring her to "infuse [her] money into it to cover the expenses."
In October 2015, defendant sent an e-mail to plaintiff's attorney which stated, "I wanted to check in to see if you were able to contact the person that was going to work on the valuation of Heritage so we can continue to make progress." Around the same time, plaintiff's attorney exchanged e-mails with Preston Walrath, who assisted with the valuation, and defendant transmitted certain documentation required for the valuation.
In November 2015, plaintiff sent an e-mail to Walrath which stated that she and defendant wanted to "put the pharmacy out for sale . . . ." But in April 2016, plaintiff sent an e-mail to her attorney stating defendant was "unresponsive and unwilling to [agree to] a binding agreement for the sale." She suggested they "stick to the original plan for [defendant] to buy [her] out." The next day, plaintiff's attorney sent an e-mail stating he was withdrawing himself from the matter because there was "a clear conflict between the parties." A few weeks later, plaintiff sent an e-mail to defendant stating, "After reviewing [the] pharmacy evaluation back in November 2015, you offered 250,000 to buy off the remaining 51% of my share. I would like to proceed with that offer and close this chapter in my life. You need to respond and own up to your promise to me."
The court granted in part the JNOV motion and found plaintiff could not be liable for intentional interference with contractual relations because she was "an agent of a party to the [APA]." The court accordingly modified the judgment to delete the award of $250,000 on the cause of action for intentional interference with contractual relations. The court otherwise denied the JNOV motion and motion for new trial, explaining that "[t]he parol evidence rule was correctly applied." According to the court, "[plaintiff] pleaded and proved a breach of contract of an alleged oral agreement. 'When the parties to a written contract have agreed to it as an "integration"—a complete and final embodiment of the terms of an agreement—parol evidence cannot be used to add to or vary its terms.' [Citation.] [Plainiff] was not pursuing a fraud cause of action at trial. The exception to the parol evidence rule did not apply, because [plaintiff] did not attempt 'to present extrinsic evidence to show that the agreement was tainted by fraud." Plaintiff, defendant, and Precision appeal.
DISCUSSION
On appeal, plaintiff first contends the court erred by not considering parol evidence "to show that the [APA] and Bill of Sale did not contain the actual agreement between the parties." Instead of the $1 consideration provided for in the APA, plaintiff asserts the parties had orally agreed to proceed with a valuation of Heritage and plaintiff would receive compensation based on the appraised value. She accordingly requests we reverse the order granting nonsuit on plaintiff's claims and remand for a new trial. Second, plaintiff contends the court erred by failing to order a new trial or entering the JNOV verdict because the evidence did not support a finding that plaintiff had concealed the Board inspections or disciplinary actions from defendant. She likewise claims substantial evidence did not support the damages award. Third, plaintiff argues the court abused its discretion by allowing excerpts from her videotaped deposition to be played to the jury during defendant's opening statement. Fourth, plaintiff asserts the court abused its discretion by refusing to admit into evidence a 2016 FDA letter to Precision.
None of the parol evidence rule exceptions that plaintiff raises on appeal apply to the instant case. And even assuming the court erred by not considering parol evidence of the parties' oral agreement, any error was harmless. Because there was sufficient evidence to support the jury's findings of concealment and damages, the court also did not err by denying the JNOV and new trial motions. We further disagree with plaintiff's contentions that the court made certain evidentiary errors.
The Court Did Not Err by Not Considering Parol Evidence
Plaintiff argues the court erred by not considering the parol evidence of the parties' oral agreement that they would conduct a valuation of Heritage after the APA and that defendant would pay plaintiff according to that valuation. She relies on three exceptions to the parol evidence rule—Evidence Code section 622, ambiguity, and fraud. She also generally claims the APA "was not a valid contract" and was "signed to quickly transfer ownership of the pharmacy to [defendant] to comply with the order of the [Board]." These exceptions to the parol evidence rule do not apply to the instant case, and even assuming the court erred by not considering parol evidence, any error was harmless.
A. Applicable Law and Standard of Review
The parol evidence rule is codified in Code of Civil Procedure section 1856. Section 1856, subdivision (a) provides: "Terms set forth in a writing intended by the parties as a final expression of their agreement with respect to the terms included therein may not be contradicted by evidence of a prior agreement or of a contemporaneous oral agreement." "This rule is based on sound logic and policy; when a contract is reduced to writing, it is presumed to contain all of the material terms, and it cannot reasonably be presumed that the parties would intend two contradictory terms to be part of the same agreement. [Citation.] Therefore, the parol evidence rule 'is not merely a rule of evidence excluding precontractual discussions for lack of credibility or reliability. It is a rule of substantive law making the integrated written agreement of the parties their exclusive and binding contract no matter how persuasive the evidence of additional oral understandings. Such evidence is legally irrelevant and cannot support a judgment.'" (IIG Wireless, Inc. v. Yi (2018) 22 Cal.App.5th 630, 640.) When no evidentiary conflict exists, the operation of the parol evidence rule is a question of law. (Ibid.)
All further statutory references are to the Code of Civil Procedure unless otherwise stated.
Here, the APA included the following integration clause: "This Agreement constitutes the sole and only agreement between [Precision] and [Heritage] respecting the Business or the sale and purchase of it. This Agreement correctly sets forth the obligations of [Precision] and [Heritage] to each other as of its date. Any additional agreements or representations respecting the Business or its sale to [Precision] not expressly set forth in this Agreement are null and void, unless otherwise required by law. Both parties agree to waive rights as to any conflicting laws which may nullity this Agreement to the full extent allowable by law." (Italics omitted.)
Despite the integration clause, plaintiff asserts "[e]xtrinsic evidence showing true consideration is not barred . . . ." She relies on Evidence Code section 622, which provides: "The facts recited in a written instrument are conclusively presumed to be true as between the parties thereto, or their successors in interest; but this rule does not apply to the recital of a consideration."
But this "exception for recitals of consideration may not be invoked to impose additional obligations on one of the parties when it would vary the terms of the written contract." (11 Williston on Contracts (4th ed. 2019) § 33:46.) While actual consideration may be shown by extrinsic evidence, "where the recital as to consideration is more than a mere statement of fact or acknowledgment of payment of a money consideration and is of a contractual nature, as where the consideration consists of a specific and direct promise to do certain things, this part of the contract can no more be changed or modified by parol evidence than any other part." (14 Cal.Jur.3d (2020) Contracts, § 138.) "[E]vidence of want of consideration or of a different consideration is not admissible if it tends to vary or defeat the legal operation of the agreement." (Ibid.) Here, the APA did not contain a mere statement of fact or acknowledgment of payment. It included a specific and direct promise—Heritage agreed to sell all of its assets for $1. The bill of sale also stated the sale was "[f]or and in consideration of the sum of $1.00 U.S. Dollar . . . ." This statement of consideration could not be contradicted by extrinsic evidence.
The primary case relied upon by plaintiff, Feinberg v. Teitelbaum Furs, Inc. (1965) 236 Cal.App.2d 744 (Feinberg), does not change our conclusion. In Feinberg, the written contract stated that it was entered into for "'other good and sufficient consideration.'" (Id. at p. 748, italics omitted.) Because the agreement referenced consideration that was not in the contract itself, the court allowed extrinsic evidence to determine the "other good." (Id. at p. 752.) The court explained: "[T]he introduction of parol evidence to show consideration in addition to that recited in the instrument is proper, when phrases such as 'other valuable considerations,' 'part of the consideration,' or 'other good and sufficient consideration,' are used." (Ibid.) This makes sense because the parol evidence was used to clarify the language rather than contradict the written agreement. The same circumstances do not exist here.
C. Ambiguity
Plaintiff also claims the APA is ambiguous because it required preparation of the bill of sale, which in turn includes the following provision: "The parties hereby agree to execute such other documents and perform such other acts as may be necessary or desirable to carry out the purposes of this Bill of Sale." According to plaintiff, the bill of sale does not identify what additional documents are required so parol evidence should have been considered to demonstrate the parties' "understanding of the terms of the [APA]." We disagree.
"The basic goal of contract interpretation is to give effect to the parties' mutual intent at the time of contracting. [Citations.] When a contract is reduced to writing, the parties' intention is determined from the writing alone, if possible. [Citation.] 'The words of a contract are to be understood in their ordinary and popular sense.'" (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 955.)
But "because written words may have special meanings to the contracting parties that are not apparent on the face of the document itself," contract language may need to be understood through extrinsic evidence of the parties' intent. (Abers v. Rounsavell (2010) 189 Cal.App.4th 348, 356.) "[P]arol evidence is properly admitted to construe a written instrument when its language is ambiguous. The test of whether parol evidence is admissible to construe an ambiguity is not whether the language appears to the court to be unambiguous, but whether the evidence presented is relevant to prove a meaning to which the language is 'reasonably susceptible.' [Citation.] [¶] The decision whether to admit parol evidence involves a two-step process. First, the court provisionally receives (without actually admitting) all credible evidence concerning the parties' intentions to determine 'ambiguity,' i.e., whether the language is 'reasonably susceptible' to the interpretation urged by a party. If in light of the extrinsic evidence the court decides the language is 'reasonably susceptible' to the interpretation urged, the extrinsic evidence is then admitted to aid in the second step—interpreting the contract." (Winet v. Price (1992) 4 Cal.App.4th 1159, 1165.)
Even so, "[a]n agreement is not ambiguous merely because the parties (or judges) disagree about its meaning. Taken in context, words still matter." (Abers v. Rounsavell, supra, 189 Cal.App.4th at p. 356.) "Our task is to construe the [contracts] as they are, not as [plaintiff] want[s] them to be. 'We do not have the power to create for the parties a contract that they did not make and cannot insert language that one party now wishes were there.'" (Id. at p. 361.) "Further, parol evidence is admissible only to prove a meaning to which the language is 'reasonably susceptible' [citation], not to flatly contradict the express terms of the agreement." (Winet v. Price, supra, 4 Cal.App.4th at p. 1167.)
Here, plaintiff's parol evidence does not suggest the APA is reasonably susceptible to plaintiff's interpretation—that the sale for $1 was not intended to be a sale for $1. The evidence consists of e-mails between the parties discussing a valuation of the pharmacy after they signed the APA. But they do not suggest the parties agreed to a different purchase price than stated at the time of the APA. To provide context to these e-mails, defendant testified that plaintiff had begged her to take over Heritage after the Board's accusation. Defendant also testified that "after [they] finalized the sale of the pharmacy[, plaintiff] had come back and asked for more money, and she wanted to have the pharmacy evaluated, and she felt like, you know, it was worth more money." Defendant explained she gave in to plaintiff's demands to "get [plaintiff] to leave [her] alone, to show [plaintiff] that there was no value of the pharmacy at that time . . . ." When viewed in this context, the e-mails do not prove the APA is reasonably susceptible to plaintiff's interpretation.
D. Fraud Exception
Plaintiff next argues evidence of the parties' agreement regarding a valuation was admissible under the fraud exception to the parol evidence rule. She asserts the fraud exception applies because she alleged the affirmative defense of fraud in the inducement in her answers to the cross-complaint and complaint in intervention. But the fraud exception does not apply because plaintiff did not seek to set aside the APA based on fraud, she sought to enforce the APA, but on terms that contradicted its language.
Plaintiff's reliance on Riverisland Cold Storage, Inc. v. Fresno-Madera Production Credit Assn. (2013) 55 Cal.4th 1169 (Riverisland) and Julius Castle Restaurant Inc. v. Payne (2013) 216 Cal.App.4th 1423 (Julius Castle) is misplaced. Riverisland found the statutory exception to the parol evidence rule allowing a party to present extrinsic evidence to show a written agreement was procured by fraud applies even if the alleged misrepresentations are inconsistent with the written agreement. (Id. at p. 1182; see § 1856, subd. (g) [fraud exception to the parol evidence rule].) Julius Castle followed Riverisland and explained that "'"parol evidence of fraudulent representations is admissible as an exception . . . to show that a contract was induced by fraud."'" (Julius Castle, at p. 1440.)
These cases are inapplicable because plaintiff did not offer evidence that defendant made misrepresentations or fraudulently procured the parties' agreement to the APA. While plaintiff points to her affirmative defense of fraudulent inducement, she did not seek to set aside the APA based on fraud. Instead, she attempted to introduce parol evidence to ascribe a different meaning to the APA in support of her effort to enforce it. Riverisland and Julius Castle accordingly have no bearing here.
E. Validity of APA
Finally, plaintiff claims parol evidence should have been considered because the validity of the APA was at issue. She again relies on her affirmative defense of fraud in the inducement. Section 1856, subdivision (f) provides: "Where the validity of the agreement is the fact in dispute, this section does not exclude evidence relevant to that issue." But plaintiff acknowledged the validity of the APA by alleging a breach of that contract in the complaint. She did not argue defendant prepared a written contract contrary to their agreement. Instead, she sought to modify the terms of the APA to reflect an alleged oral understanding. And, plaintiff was represented by legal counsel during the negotiation of the agreement. Her counsel sent an e-mail to the Board confirming the $1 purchase price and stating the "transaction [was] an arms-length transaction . . . ." Given the unique circumstances of this case, the validity of the agreement was not in dispute.
F. Harmless Error
Even if the court erred by not considering parol evidence of the parties' oral agreement, any error was necessarily harmless. This is because of the jury's finding on defendant's concealment claim. As explained below, there was sufficient evidence to support the jury's finding that plaintiff intentionally concealed facts regarding the Board's investigation and findings before the parties entered into the PSA. Because the jury found defendant never would have invested $650,000 in the first place, which is supported by the evidence, the jury would not have awarded damages to plaintiff pursuant to a purported oral agreement requiring defendant to pay even more money for the pharmacy. Under these circumstances, any error in failing to consider the parol evidence was harmless.
The Court Did Not Err by Denying Plaintiff's Motion for New Trial or JNOV Motion
A. Applicable Law and Standards of Review
Section 629, subdivision (a) provides: "The court, before the expiration of its power to rule on a motion for a new trial, either of its own motion . . . or on motion of a party against whom a verdict has been rendered, shall render judgment in favor of the aggrieved party notwithstanding the verdict whenever a motion for a directed verdict for the aggrieved party should have been granted had a previous motion been made."
"'"The trial court's discretion in granting a motion for judgment notwithstanding the verdict is severely limited." [Citation.] "'The trial judge's power to grant a judgment notwithstanding the verdict is identical to his power to grant a directed verdict [citations]. The trial judge cannot reweigh the evidence [citation], or judge the credibility of witnesses. [Citation.] If the evidence is conflicting or if several reasonable inferences may be drawn, the motion for judgment notwithstanding the verdict should be denied. [Citations.] "A motion for judgment notwithstanding the verdict of a jury may properly be granted only if it appears from the evidence, viewed in the light most favorable to the party securing the verdict, that there is no substantial evidence to support the verdict. If there is any substantial evidence, or reasonable inferences to be drawn therefrom, in support of the verdict, the motion should be denied." [Citation.]'" [Citation.]' [Citation.] 'On review of an order granting JNOV, we "'must resolve any conflict in the evidence and draw all reasonable inferences therefrom in favor of the jury's verdict.'"'" (Simmons v. Ware (2013) 213 Cal.App.4th 1035, 1047-1048.)
"A new trial shall not be granted upon the ground of insufficiency of the evidence to justify the verdict or other decision, nor upon the ground of excessive or inadequate damages, unless after weighing the evidence the court is convinced from the entire record, including reasonable inferences therefrom, that the court or jury clearly should have reached a different verdict or decision." (§ 657.) "'A trial court has broad discretion in ruling on a new trial motion, and the court's exercise of discretion is accorded great deference on appeal.'" (Hasso v. Hapke (2014) 227 Cal.App.4th 107, 119.) "'We defer to the trial court's factual determination when the court grants a motion for new trial, not when the court denies such a motion. When the court denies the motion, we presume the jury's verdict is correct.'" (Ibid.)
B. Substantial Evidence of Concealment
Here, the record contained sufficient evidence to support the jury's finding that plaintiff intentionally concealed facts regarding the Board's investigation and findings before the parties entered into the PSA. Defendant entered into the PSA in 2013 and paid $650,000 for a 49 percent ownership interest in Heritage. The Board investigations took place in 2012, a year before defendant's investment. According to defendant's trial testimony, plaintiff never disclosed that a pharmacy employee had complained in 2011 about illegal activity taking place at Heritage before defendant entered into the PSA. Plaintiff also never mentioned the Board had undertaken an investigation based on the employee's complaints or that the Board had conducted at least five inspections prior to defendant's investment. Defendant did not learn about the employee's complaints until 2014 when the Board filed an accusation against plaintiff. Even then, defendant testified plaintiff told her the allegations were "not true" and the employee was "blackmailing her."
Despite defendant's testimony, plaintiff contends there was insufficient evidence of concealment and that defendant "was fully on notice of the Board's findings such that a duty to investigate was triggered." First, she points to evidence that defendant spent time at the pharmacy and conducted due diligence in 2012 before executing the PSA. She also notes that an employee testified she had seen defendant inside a room at the pharmacy where there was a binder containing the Board reports from the inspections. The employee explained the Board reports were accessible to all employees and that plaintiff encouraged others to review the reports. Plaintiff further notes that defendant visited another pharmacy in 2013 where she asked someone "how to deal with inspections and findings of the [Board]."
At best, the above evidence establishes that defendant was physically present at the pharmacy and conducted due diligence related to her investment before entering into the PSA. It does not suggest defendant was aware of illegal activity or the related Board investigation. In fact, defendant testified she first learned about the employee's complaints that resulted in the Board's investigation in 2014—almost a year after the PSA—and plaintiff assured her those complaints were false at that time. While defendant testified she knew about the binder containing inspections of the Board and that she saw the binder, she also explained that she never knew about the specific Board inspections regarding illegal activity at the pharmacy.
Second, plaintiff relies on her own testimony to argue there was no evidence of concealment. At trial, plaintiff testified that she and defendant "went and looked at the . . . binder [in 2012] that [contained] the pharmacy State Board inspection folder that is in the pharmacy at all times." She generally explained: "We would go one by one and go over what [an] inspection report is like. I also discussed [with defendant] that because of [the employee] causing reporting, it created a lot of problems with the state Board." Once again, this evidence does not suggest defendant was aware of the concealed facts, i.e., the illegal activity taking place at the pharmacy or the truth of the allegations investigated by the Board. Even assuming plaintiff's testimony conflicted with defendant's testimony, it was not the court's role to reweigh the evidence or judge the credibility of the witnesses in ruling on the JNOV motion. (Simmons v. Ware, supra, 213 Cal.App.4th at pp. 1047-1048.) And, we find no abuse of discretion in the court's decision to not reweigh this evidence in plaintiff's favor in ruling on the motion for new trial.
Third, plaintiff argues defendant was aware of the Board's inspection because she assisted in preparing responses to certain questions from the Board. In support of this assertion, plaintiff points to a Board report from February 2013, about one month before the PSA. Plaintiff prepared responses to the Board's questions, and defendant attached the responses and faxed them to the Board. But the Board report containing the questions did not reference the employee who had originally complained about illegal activity at the pharmacy or the employee's specific complaints. Plaintiff's responses to the questions also painted a rosy picture and did not address all of the issues that ultimately resulted in the Board's accusation. Based on this evidence, the jury could reasonably find that defendant thought she was helping with a routine inspection and did not know about any illegal activity. In fact, defendant testified she was at the pharmacy during another Board inspection in January 2013 and plaintiff told her it was just an "annual inspection."
Fourth, plaintiff asserts that defendant discussed "potential liabilities of the pharmacy" with plaintiff's attorney before executing the PSA, but this evidence does not support that defendant knew about the specific illegal activity and related investigation at issue. Plaintiff relies on an invoice from her attorney, but the invoice only references general discussions with no details suggesting defendant knew about the concealed facts. Regardless, plaintiff's attorney testified he knew nothing about the Board's investigation until after the Board's accusation in 2014 so he could not possibly have transmitted any relevant information to defendant in 2013.
Finally, plaintiff contends defendant's "complete knowledge of the Board's actions can be presented if a new trial is ordered." She claims a pharmacist at Heritage can testify as a witness about this information and that she was previously unable to serve him. She relies on the pharmacist's declaration in which he testified in conclusory fashion that defendant knew about the Board inspections and assisted plaintiff with sending responses to one of the Board reports. He also testified that he "personally saw [defendant] with the white three ring binder that contained the [Board] reports." Because all of this underlying evidence was already introduced through other witnesses, we are not persuaded that a new trial is necessary.
In considering the evidence in the light most favorable to defendant, we conclude the court did not err by denying the JNOV motion. We also conclude the court did not abuse its discretion by denying the motion for new trial.
C. Substantial Evidence Supports the Award of Damages
In her JNOV and new trial motions, plaintiff challenged the sufficiency of the evidence to support the jury's award of damages. On appeal, plaintiff generally contends the court erred by denying the motions because "there was no evidence linking any of the specific damage amounts requested with the specific actions of [plaintiff]." She accordingly claims the jury was "confused" and awarded damages based on speculation. Having reviewed the record, we conclude otherwise.
Here, defendant's expert testified he conducted a valuation of Heritage and determined its value was "zero" as of February 2015, the month the APA was entered into. He explained his conclusion was based on his analysis "and with respect to the surrender order of [plaintiff's] license," [and] that [she] had to sell" the pharmacy. Defendant also testified that the Board's accusation, which resulted from plaintiff's actions, had an impact on the business. For example, she testified that plaintiff, who was a key employee, "checked out" and was not as involved in sales and consultations. She further testified that Heritage lost several contracts with vendors and insurance companies, doctors stopped referring their patients, and sales declined "tremendously." All of this testimony provides ample evidence to support the jury's finding of causation.
Plaintiff also argues the jury improperly awarded $443,000 in damages on defendant's concealment claim. First, she claims damages were not warranted because defendant failed to prove her concealment claim. We disagree for the reasons discussed above—the record contained sufficient evidence of concealment. Second, plaintiff notes that defendant's counsel argued defendant suffered $365,383 in losses, which reflected her $650,000 investment reduced by $284,617 in distributions. Because this $365,383 amount was less than the $443,000 award, plaintiff claims the jury was confused and awarded an unsupported amount. But plaintiff ignores defendant's testimony and her e-mail to plaintiff establishing that defendant lost $508,525, which included around $78,525 in deferred compensation. Excluding the $78,525 in deferred compensation results in $430,000 in damages. By awarding $443,000 in damages, the jury had a basis on which to make the award—it could have accepted the $430,000 amount and awarded a portion of the $78,525 in deferred compensation. Alternatively, another basis exists on which the jury could have made the award—it could have accepted counsel's argument as to the $365,383 loss and also have accepted the $78,525 in deferred compensation as not being included. Adding the deferred compensation would total $443,908, a near match to the actual award. The award accordingly was based on sufficient evidence and was not impermissibly speculative. (See CACI No. 1923 [Plaintiff "must prove the amount of [her] damages. However, [plaintiff] does not have to prove the exact amount of damages that will provide reasonable compensation for the harm"].)
Plaintiff's challenge to the $100,000 award for past economic loss on defendant's breach of contract claim fares no better. Plaintiff contends there was no support for the award and notes that defendant's counsel argued damages were $660,576 for past and future lost profits. The $100,000 damages for past economic loss was supported by evidence that defendant had received $188,894 in profit in 2013. Assuming she should have received around this amount every year, she suffered a loss of about $93,894 in 2014 because she only received approximately $95,000 in profits ($188,894 less the $95,000). In 2015 through 2017, she received no profits. The $100,000 award for past economic loss accordingly was supported by sufficient evidence. (See Acree v. General Motors Acceptance Corp. (2001) 92 Cal.App.4th 385, 398 ["Where the fact of damages is certain, as here, the amount of damages need not be calculated with absolute certainty. The law requires only that some reasonable basis of computation be used, and the result reached can be a reasonable approximation" (fn. omitted)]; CACI No. 350 [Plaintiff "must prove the amount of [her] damages . . . . [She] does not have to prove the exact amount of damages"].)
Finally, plaintiff contends the jury erred by awarding damages on the intentional interference with contractual relations claim. But for the reasons discussed below, the court correctly modified the judgment to delete this portion of the jury's award.
The Court Did Not Abuse Its Discretion by Admitting Excerpts of Plaintiff's Videotaped Deposition
During defendant's opening statement, the court allowed defendant's counsel to play excerpts from plaintiff's videotaped deposition. This included her testimony about the Board's administrative and disciplinary actions against her. Plaintiff contends the court should have excluded the video clips under Evidence Code section 352 because they were prejudicial and lacked any probative value. She further claims the video clips were unnecessary because she offered to stipulate to the relevant facts, including the surrender of her pharmacist license.
Section 2025.620, subdivision (b) provides: "An adverse party may use for any purpose, a deposition of a party to the action . . . ." (Italics added.) However, evidence may be excluded under Evidence Code section 352 "if its probative value is substantially outweighed by the probability that its admission will (a) necessitate undue consumption of time or (b) create substantial danger of undue prejudice, of confusing the issues, or of misleading the jury." "[T]he trial court [has] broad discretion when weighing the probative value and prejudicial effect of proffered evidence" (People v. Gurule (2002) 28 Cal.4th 557, 654), and that exercise of discretion "will not be disturbed on appeal unless the prejudicial effect of evidence so admitted clearly outweighed its probative value." (People v. Anderson (2001) 25 Cal.4th 543, 591.)
Here, the evidence was highly probative of whether plaintiff concealed certain facts regarding the Board investigation from defendant and what those facts were. On the other hand, the evidence was prejudicial because there was a risk the jury would view plaintiff in a negative light and focus on the Board's disciplinary actions rather than the claims at issue. Under the abuse of discretion standard, a "'"decision will not be reversed merely because reasonable people might disagree. 'An appellate tribunal is neither authorized nor warranted in substituting its judgment for the judgment of the trial judge.'"'" [Citations.] Taken together, these precepts establish that a trial court does not abuse its discretion unless its decision is so irrational or arbitrary that no reasonable person could agree with it." (People v. Carmony (2004) 33 Cal.4th 367, 377.) Given our review of the disputed evidence, we cannot conclude that no reasonable judge would have admitted the evidence.
The Court Did Not Abuse Its Discretion by Refusing to Admit Evidence of a Post-sale FDA Letter to Precision
In November 2016, the FDA sent a "Warning Letter" to Precision noting that the FDA had investigated Heritage in March 2015, April 2015, and June 2016—after ownership was transferred from plaintiff to Precision. The letter states that Heritage "did not receive valid prescriptions for individually-identified patients for a portion of the drug products . . . produced." Plaintiff asserts the court abused its discretion by refusing to admit this post-sale letter because it related "directly to the issues of causation and damages." Because defendant was permitted to introduce evidence of plaintiff's pharmacy law violations, plaintiff also argues she should have been allowed to introduce the FDA letter to "level[] the playing field."
We review a trial court's ruling on a motion in limine to exclude evidence for abuse of discretion. (Piedra v. Dugan (2004) 123 Cal.App.4th 1483, 1493.) A trial court does not abuse its discretion unless it acts in an "'arbitrary, capricious, or patently absurd manner . . . .'" (San Lorenzo Valley Community Advocates for Responsible Education v. San Lorenzo Valley Unified School Dist. (2006) 139 Cal.App.4th 1356, 1419.)
Applying the above principles, we find no basis for reversal. The relevant time period at issue was March 2013 (the date of defendant's initial investment) to February 2015 (the valuation date used by both parties' experts). Purported violations in 2016 by defendant or Precision arguably had no impact on the value of the pharmacy as of the February 2015 valuation date. While plaintiff claims the court should have admitted evidence of defendant's pharmacy law violations to "level[] the playing field," defendant's post-sale violations were not the same as plaintiff's violations. The latter pre-sale violations were relevant because they occurred during the relevant time period and were highly probative of whether plaintiff impacted the value of the pharmacy and concealed certain facts from defendant.
Relying on People v. Cabral (1983) 141 Cal.App.3d 148 (Cabral), plaintiff contends she should have been allowed to counter the evidence against her. In Cabral, the court found testimony from the defendant's patients was admissible to counter the testimony of the prosecution witnesses, the parents of a deceased patient. (Id. at p. 154.) Through the testimony of these other patients, defendant offered to prove that "he conducted himself [with respect to the parents of the deceased patient] in accordance with a particular habit or custom." (Ibid.) The court accordingly found the evidence was admissible under Evidence Code section 1105, which allows "'evidence of habit or custom . . . to prove conduct on a specified occasion in conformity with the habit or custom.'" (Ibid.) The court explained: "Since the entire case against the defendant turned on the content of the advice given to the parents [of the deceased patient], probative evidence to support defendant's version of the conversation was crucial to the defense." (Ibid.) Unlike Cabral, the instant case does not concern evidence of any habit or custom. It accordingly bears little resemblance to Cabral.
Even if the court abused its discretion by refusing to admit the FDA letter, it did not amount to prejudicial error because plaintiff introduced other evidence of post-sale violations occurring after the PSA. For example, the pharmacist in charge who replaced plaintiff testified about various pharmacy violations, including a cease and desist letter from the Board in January 2015. During closing argument, plaintiff's counsel also argued plaintiff did not cause Heritage to shut down and suggested certain pharmacy law violations under defendant's leadership caused defendant's damages. Despite this evidence regarding causation and damages, the jury still found in favor of defendant. It is not "'reasonably probable that were it not for the . . . court's [allegedly] incorrect evidentiary ruling[], a result more favorable to [plaintiff] could have been obtained.'" (Bell v. Mason (2011) 194 Cal.App.4th 1102, 1107.)
There Is No Cumulative Error
Plaintiff contends the cumulative effect of the individual errors compels reversal. Because we reject plaintiff's primary contentions of error on appeal, there was no cumulative error.
Cross-appeal: The Court Did Not Err by Granting in Part Plaintiff's JNOV Motion
Defendant and Precision cross-appeal from the court's order granting in part plaintiff's JNOV motion and modifying the judgment to delete the jury's award of $250,000 on defendant's claim for intentional interference with contractual relations. They argue the court erred by finding that, because plaintiff was an agent of Heritage (a party to the APA), she could not be liable for interfering with the APA. According to defendant and Precision, plaintiff acted in her individual capacity at the time of her interference so she was a "'stranger' to the [APA] for purposes of the tort of intentional interference." The court did not err. Plaintiff was an agent of Heritage, a party to the APA. As a result, her actions may have amounted to harassing behavior or a breach of the APA, but she did not interfere with the APA as a third party.
At the outset, we note that the cross-complaint and complaint in intervention did not allege a claim for interference with contract against plaintiff. Instead, they alleged a claim for interference with contract against Cline and Hummingbird for their conduct after the APA, including their attempt to take over plaintiff's interest in Heritage after it had already sold its assets to Precision. Although the claim was alleged against Cline and Hummingbird, the parties proceeded to trial and litigated the claim as if it was alleged against plaintiff, and the jury awarded damages against plaintiff. In a footnote, plaintiff argues she cannot be liable because the relevant complaints did not plead an action for interference against her. While this is true, plaintiff forfeited this argument and "may not assert the pleading defect for the first time on appeal." (Ghirardo v. Antonioli (1996) 14 Cal.4th 39, 48; see Hilliard v. A. H. Robins Co. (1983) 148 Cal.App.3d 374, 392 ["'Where the parties try the case on the assumption that . . . [an] issue . . . [is] raised by the pleadings, . . . neither party can change this theory for purposes of review on appeal'"].)
Regardless, the court did not err by finding plaintiff could not be liable for interference with contractual relations. As established by our Supreme Court in Applied Equipment Corp. v. Litton Saudi Arabia Ltd. (1994) 7 Cal.4th 503, a party cannot be held liable for interfering with her own contract. "'[O]rdinarily corporate agents and employees acting for or on behalf of the corporation [also] cannot be held liable for inducing a breach of the corporation's contract since being in a confidential relationship to the corporation their action in this respect is privileged.'" (Id. at p. 512, fn. 4.) The rationale for this rule is that parties who enter into contractual relations should be subject to contract remedies if there is a dispute concerning their performance of those agreements. By contrast, the tort of interference is intended to prevent the contracting parties "against frustration by outsiders who have no legitimate social or economic interest in the contractual relationship." (Id. at p. 514.)
Here, plaintiff was not a stranger to the APA. As defendant and Precision concede, plaintiff was an agent of Heritage, a party to the APA, and signed the APA on Heritage's behalf. But defendant and Precision claim plaintiff was no longer an agent of Heritage at the time of her interference when she "harass[ed defendant] for additional money and an appraisal, or when she enlisted Cline to sabotage the outcome of the agreement." We see no distinction between plaintiff's status as an agent of Heritage at the time of the APA or after the APA. She negotiated and signed the APA on behalf of Heritage and later engaged in similar conduct by attempting to negotiate a different consideration for the sale. At best, plaintiff's alleged actions may have amounted to harassing behavior or a breach of the APA, but they do not suggest plaintiff is liable for interfering with the APA as a third party. (Shoemaker v. Myers (1990) 52 Cal.3d 1, 24 ["It is . . . well established that corporate agents and employees acting for and on behalf of a corporation cannot be held liable for inducing a breach of the corporation's contract"].)
In the alternative, defendant and Precision argue plaintiff acted in her individual capacity even if she was an agent of Heritage at the time of her interference. They claim this is apparent because plaintiff sought money and an appraisal for herself and sued in her individual capacity. But this ignores the context of plaintiff's actions. Plaintiff was Heritage's agent at the time she signed the APA on Heritage's behalf. She also was a majority owner of Heritage and had a personal share of the assets. Although she was forced to surrender her pharmacist license and involvement with Heritage, she sought to modify the terms of the APA that she negotiated by claiming Heritage was worth more than $1. When viewed in this context, the court did not err by finding plaintiff could not be liable for interfering with the APA. (PM Group, Inc. v. Stewart (2007) 154 Cal.App.4th 55 [holding that neither "[the entertainer defendant] nor his agents [could] be liable for the tort of interfering with [certain] subcontracts"]; Applied Equipment Corp. v. Litton Saudi Arabia Ltd., supra, 7 Cal.4th at p. 514 ["One contracting party owes no general tort duty to another not to interfere with performance of the contract; its duty is simply to perform the contract according to its terms"].)
Because plaintiff was an agent of Heritage, we need not address the parties' alternative arguments as to whether plaintiff would be immunized from liability if she merely had an interest in the APA.
DISPOSITION
The judgment is affirmed. The parties shall bear their own costs incurred on appeal.
IKOLA, J. WE CONCUR: O'LEARY, P. J. THOMPSON, J.