Superior Court of Tehama County

Procedural Posture

Defendant lessee challenged the judgment of the Superior Court of Tehama County (California), which granted plaintiff contractor a judgment for the balance owed for work performed in the clearing and leveling of three parcels of land on which the lessee ran a dairy farm.

Overview

The contractor, the lessor, and the lessee agreed that the contractor would clear and level several parcels on which the lessee ran a dairy farm. The contract called in part for the lessee to pay the contractor from the lessee's profit from crops raised on the land that was cleared. When the lessee did not pay, the contractor obtained a judgment for the balance due. On review, the court held that the contractor's action alleged four causes of action, all of which relied on the contract's terms. Therefore, if the contract count was defective, then all of the counts were defective. The court held that the contractor failed to plead the essential element that the lessee actually profited from his use of the land; the lessee did not have to pay until that condition was met. Because that essential element was not plead, the trial court should have sustained the demurrer as to all of the counts of the complaint. Second, not only did the contractor fail to plead that the lessee had produced profits from which he could pay the debt, the contractor failed to prove that the lessee had produced profits. Therefore, the evidence was insufficient to sustain the judgment.

Outcome: California final paycheck law

The court reversed the judgment of the trial court.

Procedural Posture

The parties appealed from a decision of the Superior Court of San Diego County (California) in which the trial court entered judgment in favor of plaintiff-appellant for restitution based on rescission, compensatory damages, and punitive damages in plaintiff-appellant contract and tort action against defendant-appellants.

Overview

Plaintiff-appellant brought a contract and tort action against defendant-appellants based on their violation of a covenant not to compete. Judgment was entered in favor of plaintiff-appellant for restitution based on rescission, compensatory damages, and punitive damages. The parties appealed. One issue on appeal was whether the jury instruction on covenants not to compete was erroneous. The court reviewed the instruction, which stated a covenant not to compete would be enforced to the extent that it was reasonable and necessary in terms of time, activity, and territory to protect the buyer's interest. Defendant-appellants contended the territorial extent of the instruction was too broad and violated Cal. Bus. & Prof. Code § 16601. The court held the instruction was proper and affirmed the decision. The court noted the territory encompassed in the terms of the covenant was an accumulation of the cities and counties impacted by the market area of the business, which was sold.

Outcome

The court affirmed the lower court's decision and held that the jury instruction on covenants not to compete was proper because the territory encompassed in this case was an accumulation of the cities and counties impacted by the market area of the business, which was sold.