E.J. Franks Construction v. Sahota

Filed 6/5/14

CERTIFIED FOR PARTIAL PUBLICATION*

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIFTH APPELLATE DISTRICT

E. J. FRANKS CONSTRUCTION, INC.,
F066327
Plaintiff, Cross-defendants and
Respondents, (Super. Ct. No. CU149926)

v.
OPINION
BHUPINDER K. SAHOTA et al.,

Defendants, Cross-Complainants and
Appellants.

APPEAL from a judgment of the Superior Court of Merced County. Ronald W.
Hansen, Judge.

P. Fateh K. Sahota for Defendants, Cross-complainants and Appellants.
Sean P. McLeod for Plaintiff, Cross-defendants and Respondents.
-ooOoo-

*Pursuant to California Rules of Court, rules 8.1105(b) and 8.1110, this opinion is
certified for publication with the exception of the Facts and parts II. through VI. of the
Discussion.
 INTRODUCTION
Edward J. Franks II became a licensed general building contractor in 1995, and
operated a sole proprietorship under the name E. J. Franks Construction. During the
course of constructing a home for defendants (the Sahotas), Franks incorporated his
company under the name E. J. Franks Construction, Inc. (EJFCI). On April 12, 2005, his
contractor’s license was reissued to the corporation. The trial court rejected the Sahotas’
contention EJFCI was prohibited by Business and Professions Code section 70311 from
pursuing quantum meruit damages against them because it was an unlicensed contractor
at the time the construction contract was entered and, therefore, was not licensed “at all
times” during the performance of the contract. The Sahotas appeal this ruling and also
raise other contentions. In the published portion of this opinion, we hold section 7031
does not apply to the unique situation here because to do so would not advance the
statute’s goal of precluding unlicensed contractors from maintaining actions for
compensation. We reject the Sahotas’ other contentions in the unpublished portion of the
opinion.
PROCEDURAL HISTORY
On December 6, 2006, EJFCI filed its complaint in the Merced Superior Court,
case No. 149926, to foreclose on a mechanic’s lien, and for breach of contract, common
counts, and quantum meruit. On or about July 5, 2007, the Sahotas served an answer to
the complaint.

1All further statutory references are to the Business and Professions Code unless
otherwise indicated.
Section 7031 provides, in relevant part, as follows: “(a) Except as provided in
subdivision (e), no person engaged in the business or acting in the capacity of a contractor, may
bring or maintain any action, or recover in law or equity in any action, in any court of this state
for the collection of compensation for the performance of any act or contract where a license is
required by this chapter without alleging that he or she was a duly licensed contractor at all times
during the performance of that act or contract, regardless of the merits of the cause of action
brought by the person, except that this prohibition shall not apply to contractors who are
individually licensed under this chapter but who fail to comply with Section 7029.”

2.
 On July 5, 2007, the Sahotas filed a cross-complaint, asserting breach of contract
and fraud. Cross-defendants Eddie Franks, E. J. Franks Construction and EJFCI served
an answer to the cross-complaint on or about February 22, 2008.
Prior to trial, the court ruled that plaintiff EJFCI was limited to its claims of
“quantum meruit or unjust enrichment” after April 12, 2005, for extra work performed at
the Sahotas’ residence.
Jury trial commenced June 26, 2012. On June 29, 2012, the jury reached a verdict
in favor of EJFCI on its complaint and against the Sahotas on their cross-complaint.
On July 20, 2012, the Sahotas sought a new trial, or in the alternative, a remittitur.
That same date, the Sahotas also filed a motion for judgment notwithstanding the verdict.
Following a hearing on August 17, 2012, the various motions were denied by the trial
court.
Judgment was entered in favor of EJFCI and against the Sahotas on September 18,
2012. More specifically, EJFCI was to recover $66,000 in damages and $2,949.15 in
costs, for a total judgment of $68,949.15 against the Sahotas.
FACTS*
On September 27, 2004, E. J. Franks Construction entered into a written contract
with Bhupinder K. Sahota to build the Sahotas a custom home on their property located
in Livingston. The total cost was $962,390.40; construction would take approximately
12 months.
Work began in November 2004. During the construction period, Edward J. Franks
II, who was issued a general building contractor license in 1995, incorporated his
business. On April 12, 2005, his contractor’s license number was reissued to EJFCI.
When the Sahota project was about 90 percent complete, in the spring of 2006, the
Sahotas refused to allow Franks to continue or complete the work. They hired another
contractor to finish the home.

*See footnote, ante, page 1.

3.
 At trial, Franks alleged the Sahotas asked for numerous changes to the original
plans, or extra work, after April 12, 2005. That extra work included converting an
upstairs closet into a hall bathroom, upgrading the downstairs flooring to marble (v. vinyl
& hardwood) and installing a portion of the entry or living room area tile in a diamond (v.
square) pattern, upgrading countertops to granite (v. tile), adding a sound barrier in an
upstairs room, enclosing an existing attic space to create a living space, additional
electrical work that included adding can lights, exterior lights and electrical outlets on the
back porch, extending the height of the tile on the shower walls, upgrading the drywall
finish from the typical spray-on finish to a custom “imperfectly smooth” wall finish,
insulating all interior walls and cavities, upgrading the communication or alarm system to
a “smart home” system, adding windows and doors over and above those called for in the
plans, relocating a showerhead and adding a sink in the master bath, changing the
bathtubs, adding a water softening system and a hot water circulation system with two
comfort zones, relocating a built-in BBQ, including gas and water supply lines, and
adding shearing to all exterior walls. Franks complied with the Sahotas’ numerous
requests and expected to be paid for the extra work.
Mrs. Sahota testified that Franks agreed to build a custom home within one year.
She was reluctant to make the final payment because Franks’ work was slowing down
and he did not return her phone calls. She offered testimony in opposition to Franks’
regarding some of the work he claimed was extra work. Further, as to the extra work that
was performed, she testified Franks agreed to cover the labor costs or make the requested
changes without additional compensation. She also indicated that when Franks was
terminated from the project, the house was not move-in ready, and another $234,683.30
was spent to finish the home.
The Sahotas alleged there were numerous defects in the construction of their
home. They contend as follows: the roof was not installed pursuant to either the plans or
the applicable building codes, the roof leaked and caused water damage, the roof
ventilation was inadequate, exterior stucco was not installed pursuant to either the plans

4.
or applicable building codes and was cracked and damaged, balconies were improperly
constructed allowing for water damage, exterior door frames were not properly
constructed, floor tiles were uneven and not in compliance with the building code, water
heater platforms were not in compliance with the building code, and propane furnaces in
the attic did not conform to the applicable mechanical code.
Franks testified that he believed the subcontractors he employed to perform the
work at the Sahotas’ residence complied with all applicable building codes. Further, the
construction phases were variously approved by the appropriate building inspector
officials and, prior to his termination, the Sahotas did not complain of any problems. A
number of the defects complained of pertained to items that were installed or modified
following his termination from the project or were not maintained properly in the six-year
period between his termination and the defense expert’s inspections.
EJFCI asked the jury to return a verdict in its favor for the reasonable value of the
extra work performed at the Sahotas’ residence after April 12, 2005. On the other hand,
the Sahotas asked the jury to find in their favor, seeking a total award of $503,582.30 to
cover the completion of construction and repair of the construction defects as identified
by their expert.
After deliberating approximately 45 minutes, the jury returned a verdict in favor of
EJFCI, awarding a total of $66,000 in quantum meruit damages. The jury also found
against the Sahotas on their cross-complaint.
DISCUSSION
I. The Applicability of Section 7031
The Sahotas argue that section 7031 is a complete bar to EJFCI’s quantum meruit
claim and that the trial court erred in allowing the corporation to proceed with the cause
of action.
“‘Quantum meruit refers to the well-established principle that “the law implies a
promise to pay for services performed under circumstances disclosing that they were not
gratuitously rendered.” [Citation.] To recover in quantum meruit, a party need not prove

5.
the existence of a contract [citations], but it must show the circumstances were such that
“the services were rendered under some understanding or expectation of both parties that
compensation therefor was to be made.”’ [Citation.]” (Miller v. Campbell, Warburton,
Fitzsimmons, Smith, Mendel & Pastore (2008) 162 Cal.App.4th 1331, 1344.) “The
underlying idea behind quantum meruit is the law’s distaste for unjust enrichment. If one
has received a benefit which one may not justly retain, one should ‘restore the aggrieved
party to his [or her] former position by return of the thing or its equivalent in money.’
[Citation.]” (Maglica v. Maglica (1998) 66 Cal.App.4th 442, 449.) “‘The measure of
recovery in quantum meruit is the reasonable value of the services rendered provided
they were of direct benefit to the defendant.’ [Citations.]” (Ibid.) In other words,
quantum meruit is equitable payment for services already rendered.
The Contractors’ State License Law (CSLL) (§ 7000 et seq.) is a comprehensive
legislative scheme governing the construction business in California. “The licensing
requirements provide minimal assurance that all persons offering such services in
California have the requisite skill and character, understand applicable local laws and
codes, and know the rudiments of administering a contracting business. [Citations.]”
(Hydrotech Systems, Ltd. v. Oasis Waterpark (1991) 52 Cal.3d 988, 995.) The CSLL’s
purpose is to “‘protect the public from incompetent or dishonest providers of building
and construction services’” and prohibits a contractor who has violated the statute from
recovering “‘“for the fruits of his labor.”’” (Pacific Caisson & Shoring, Inc. v. Bernards
Bros. Inc. (2011) 198 Cal.App.4th 681, 687.) Pursuant to the CSLL, contractors “must
be licensed unless exempt.” (White v. Cridlebaugh (2009) 178 Cal.App.4th 506, 517.)
Section 7031 is directed at precluding unlicensed contractors from maintaining
actions for compensation. (See White v. Cridlebaugh, supra, 178 Cal.App.4th at p. 518;
WSS Industrial Construction, Inc. v. Great West Contractors, Inc. (2008) 162
Cal.App.4th 581, 587; Wright v. Issak (2007) 149 Cal.App.4th 1116, 1123.)

“Because of the strength and clarity of this policy, it is well settled that
section 7031 applies despite injustice to the unlicensed contractor. ‘Section
7031 represents a legislative determination that the importance of deterring
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 unlicensed persons from engaging in the contracting business outweighs
any harshness between the parties, and that such deterrence can best be
realized by denying violators the right to maintain any action for
compensation in the courts of this state. [Citation.] …’ [Citations.]”
(Hydrotech Systems, Ltd. v. Oasis Waterpark, supra, 52 Cal.3d at p. 995;
accord, MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works
Co., Inc. (2005) 36 Cal.4th 412, 423.)
We hold section 7031 does not apply here. At no time was the work on the
Sahotas’ home performed by an unlicensed contractor. Rather, in this case, the work
commenced pursuant to contract by E. J. Franks Construction as a sole proprietor. When
the parties entered the contract, E. J. Franks Construction was a licensed general building
contractor, having been issued a license on April 14, 1995. During the course of the
Sahota project, E. J. Franks Construction incorporated and the license issued to and
maintained by Franks was reissued to the corporation on April 12, 2005. Therefore, all of
the work accomplished at the Sahotas’ residence was performed by a licensed contractor,
to wit: the license issued to E. J. Franks Construction in 1995 and valid through April 11,
2005, and the license issued to E. J. Franks Construction, Inc., on April 12, 2005, and
valid through April 30, 2015.
Unlike the authorities cited by the Sahotas, this case did not involve a period
wherein the contractor was unlicensed or where a license previously issued lapsed during
the construction project. (See MW Erectors, Inc. v. Niederhauser Ornamental & Metal
Works Co., Inc., supra, 36 Cal.4th at pp. 419-420 [MW Erectors entered into subcontract
before it obtained a structural steel contractor’s license]; Opp v. St. Paul Fire & Marine
Ins. Co. (2007) 154 Cal.App.4th 71, 72-73 [subcontractor MCI did not hold a California
building contractor’s license when it entered into an agreement with Mauldin-Dorfmeier];
see also Alatriste v. Cesar’s Exterior Designs, Inc. (2010) 183 Cal.App.4th 656, 661
[§ 7031, subd. (b) applies because Cesar’s was unlicensed when work began]; Goldstein
v. Barak Construction (2008) 164 Cal.App.4th 845, 849-850, 855 [contractor began work
on remodel before becoming licensed, for the first time, several months later]; WSS
Industrial Construction, Inc. v. Great West Contractors, Inc., supra, 162 Cal.App.4th at

7.
pp. 585 [WSS “was unlicensed during a period in which it performed services that could
only be performed by a licensed contractor,” therefore, § 7031 bars recovery].)
Instead, this case involves a licensed contractor and a change in business entity
status. Proper licensure was in place at all times. Applying section 7031 to the
circumstances here would lead to absurd results. Were we to find section 7031 applied, it
would effectively preclude licensed sole proprietor contractors from lawfully
incorporating and obtaining a reissue of a general contracting license to the new business
entity at any time during the construction period. The purpose of section 7031 is to deter
unlicensed contractors from recovering compensation for their work. It is not intended to
deter licensed contractors from changing a business entity’s status, and obtaining a
reissuance of the license to the new entity, during a contract period.
More particularly, this court has previously recognized a distinction between a
corporation and an individual as significant for purposes of the CSLL. In Opp v. St. Paul
Fire & Marine Ins. Co., supra, 154 Cal.App.4th 71, the plaintiff signed a building
contract as president of a corporation and misrepresented his own contractor’s license
number as that of the corporation. The corporation, in fact, was unlicensed. The
president sued a surety on a payment bond to recover compensation for work performed,
alleging he was the real contracting party and that he had used the corporate name as a
fictitious business name. (Id. at pp. 72–73.) The trial court concluded the corporation
was the contracting party, the president was not a party to the contract, and section 7031
precluded any recovery in favor of the corporation as an unlicensed contractor. The court
therefore granted summary judgment in favor of the surety. (Opp, at p. 73.)
This court affirmed, stating undisputed evidence showed the corporation, rather
than its president, was the contracting party. The court therefore concluded the
corporation had acted as a contractor without a license, regardless of who actually did the
work. (Opp v. St. Paul Fire & Marine Ins. Co., supra, 154 Cal.App.4th at p. 75.) We
rejected the plaintiff’s argument that a triable issue of fact existed as to whether, despite
the fact the contract was in the name of the corporation, the plaintiff individually was also

8.
a party to the contract. We stated that to recognize the individual as a contracting party in
those circumstances would, among other things, encourage fraud through the misuse of
another person’s contractor’s license and allow an individual to enjoy the benefits of
incorporation while avoiding the burdens by effectively repudiating the existence of the
corporation when it was convenient to do so. (Id. at p. 76.)
Unlike Opp, Franks did not misrepresent his contractor’s license by claiming it
belonged to a corporate entity. In fact, the corporate entity did not exist when the
contract entered into by E. J. Franks Construction and Bhupinder K. Sahota was
executed. The corporation was not the contracting party. Here, the corporation did not
act “as a contractor without a license.” Rather, the corporation—EJFCI—was licensed as
of April 12, 2005, and that business entity merely continued the work the sole proprietor
began. These distinctions make the holding in Opp, that the plaintiff could not recover
on a surety bond and was precluded from doing so pursuant to section 7031, inapplicable
to this case.
The Sahotas’ reliance upon WSS Industrial Construction, Inc. v. Great West
Contractors, Inc., supra, 162 Cal.App.4th 581 in support of their position is misplaced.
In that case, a subcontractor brought suit against a general contractor. The subcontractor,
a corporation, did not hold a contractor’s license, but its president was a licensed
contractor at all times during the performance of work. The trial court concluded the
subcontractor had substantially complied with the license requirement and therefore
denied the defendant’s nonsuit motion. (Id. at pp. 585–586.) The Court of Appeal
reversed, holding the corporation could not recover any compensation for the work
performed because it was not a licensed contractor at the time of the performance of
work, and the president’s individual license was irrelevant. (Id. at pp. 591, 594 & fn. 8.)
The WSS court concluded the corporation had failed to satisfy the statutory requirements
for substantial compliance (see § 7031, subd. (e)) and therefore was entitled to no
recovery. (WSS Industrial Construction, Inc. v. Great West Contractors, Inc., supra, at
pp. 595–596.) Significantly, unlike this matter, WSS involved a subcontractor who

9.
entered into an agreement with a general contractor at a time when the subcontractor was
unlicensed. The subcontractor only became licensed after work commenced on the
project. Here, however, rather than enter a contract as an unlicensed contractor, Franks
entered into a contract with Bhupinder Sahota as the sole proprietor of E. J. Franks
Construction, holding general contractor’s license No. 705224. Later, that license was
reissued to the corporation.
Unlike the aforementioned authorities, the damages recovered by EJFCI following
the jury’s verdict do not pertain to either work performed while the corporation was
unlicensed or work performed pursuant to the contract Franks, as an individual or sole
proprietor, entered into with the Sahotas. Rather, the damages covered only extra work
over and above the contract, and only for the period following the reissuance of the
general building contractor license from E. J. Franks Construction to EJFCI on April 12,
2005. As the court in MW Erectors, Inc., stated, section 7031’s language stressing “that
an unlicensed contractor may not sue for compensation … implies that licensed
contractors have noncontractual remedies to recover for work not covered by a formal
contract. Indeed, parties do sometimes operate without, or beyond the boundaries of, a
formal contractual arrangement, under an implicit understanding that the contractor is
working on a quantum meruit basis.” (MW Erectors, Inc. v. Niederhauser Ornamental &
Metal Works, Co., Inc., supra, 36 Cal.4th at p. 428.)
This case does not present a situation in which the court resorted to equitable
considerations in defiance of section 7031. Thus, EJFCI was not precluded from
recovering quantum meruit damages and the trial court did not err in ruling accordingly.
To the degree the Sahotas’ reply brief now contends EJFCI must disgorge its
compensation pursuant to section 7031, subdivision (b), we will not consider this
argument. Disgorgement was not argued or even mentioned in the Sahotas’ opening
brief. “[W]e will not address arguments raised for the first time in the reply brief
[citation] ….” (Provost v. Regents of University of California (2011) 201 Cal.App.4th
1289, 1295.)

10.
II. The Applicability of Section 7164*
Next, the Sahotas argue the trial court erred in permitting EJFCI to proceed on its
quantum meruit claims because section 7164 requires a written contract.
Subdivision (a) of section 7164 provides, in pertinent part, that “every contract and
any changes in a contract, between an owner and a contractor, for the construction of a
single-family dwelling to be retained by the owner for at least one year shall be
evidenced in writing signed by both parties.”
Here, the extra work or changes were the subject of a defense motion in limine
prior to the commencement of jury trial:

“[THE COURT:] Motion Number 2. Okay, this is to preclude
introduction of evidence of unsigned changed orders based on violation of
B&P Code 7164 and … the Arya Case,[2] okay. [¶] Now, I have yet to see
a change order that has any signatures.

“[PLAINTIFF’S COUNSEL]: That is correct.

“THE COURT: So there are none. Factually, it’s undisputed.

“[PLAINTIFF’S COUNSEL]: That is correct.

“THE COURT: So there is a violation of 7164. What’s Plaintiff’s
argument?

“[PLAINTIFF’S COUNSEL]: Plaintiff’s argument is that those change
orders are the evidence compiled by Mr. Franks to keep track of the extra
charges that were incurred on the home. They’re a business record that was
produced at Mr. Franks’ direction concurrently with the or shortly after the
work being done and they’re being used—they’re being submitted as a
business record by which Mr. Franks kept track of the extra work that he
did. They should be—they don’t necessarily have to be as a change order.
They’re obviously not signed by the Sahotas and they’re termed change
order but what they are was the record that Mr. Franks kept of the extra
work that was done.

*See footnote, ante, page 1.
2Referring to Arya Group, Inc. v. Cher (2000) 77 Cal.App.4th 610.

11.
 “THE COURT: Boy, nice try, [counsel]. These are change orders.
They’re changing the work. They’re changing the price. That’s the—well,
they’re changing the price. You know, this isn’t just a document regarding
an allowance, okay. If it was something that dealt with the allowance items
then maybe but these are change orders of—from the plans and specs with
additional charges.

“[PLAINTIFF’S COUNSEL]: Well, as to the quantum meruit theory
though, Your Honor, they can go come in to show Mr. Franks—through
evidence of what Mr. Franks did on the quantum meruit cause of action
making the changes at their request, which they promised to pay for, which
he provided the benefit to them. These are the records he kept.

“THE COURT: Okay. If he’s going on quantum meruit then he has
to—on the Arya case it says that ….

“[DEFENDANTS’ COUNSEL]: Well, as to the reasonable value of the
work performed only to the extent the owner would be unjustly enriched if
enforcement were denied.

“THE COURT: Right.… [¶] … [¶] … But the Court did say that,
you know, in that case it would unjust enrichment should be allowed
because she essentially defrauded the Arya … Group.

“[DEFENDANTS’ COUNSEL]: But, Your Honor.

“THE COURT: I’m not sure we have that in this case. We don’t have
someone who’s trying to mislead, or I don’t have any evidence of it.

“[PLAINTIFF’S COUNSEL]: Your Honor, the measure of recovery
quantum meruit is the reasonable value of the services rendered provided
they were of direct benefit to the defendant. And that’s a quote from
Palmer v. Craig[3] of California Supreme Court case, that’s the basic
quantum meruit theory. That’s the hornbook.

“And in this case the evidence will show that the defendants asked
Mr. Franks to do this work. That Mr. Franks, on their request, had a
subcontractor make those changes. Mr. Franks paid the subcontractor for
the work, and the Sahotas then refused to pay for the additional work that
was necessary to make those changes.

“That’s—I mean, that’s just straight quantum meruit. They provided
the services and the goods. Mr. Franks provided the benefit, paid for it out

3Referring to Palmer v. Gregg (1967) 65 Cal.2d 657.

12.
 of his own pocket, passed it on without increase in cost. He didn’t add
profit and all that stuff to it.

“They asked him to do something. For example, there is going to be
evidence to change a closet to a bathroom. He did it. He had to get the
plumber back, he had to get the different appliances, put them in there.
Rendering the benefit to them by doing what they asked him to do and then
they said, oh, we’re not paying you for it. In fact, they said, oh, no, you
promised to do that for free. So to me that’s a straight quantum meruit.

“THE COURT: Well, you have to show unjust enrichment.

“[DEFENDANTS’ COUNSEL]: Right. He has to show what the
reasonable value of it was. You don’t get contractual value.

“THE COURT: Right.

“[DEFENDANTS’ COUNSEL]: You get the reasonable value provided
it enriched the defendant.

“THE COURT: Right.

“[DEFENDANTS’ COUNSEL]: And so—but he doesn’t need the
change orders. These pieces of paper should be excluded because that is
purely, that should be based upon some other evidence, whatever other
evidence he can come up with, but these change orders themselves under
that B&P Code section do not come in. They’re unsigned. They say
change order right at the very top.

“THE COURT: I agree. What I’m saying that the exhibits 3 through
8 if they relate to these change orders they would come in because they’re
the out-of-pocket cost that he incurred.

“[PLAINTIFF’S COUNSEL]: Absolutely.

“[DEFENDANTS’ COUNSEL]: That’s again, see, that’s another
question. Assuming he can lay the proper foundation.

“THE COURT: Yeah, right.”
The court concluded by stating, “I’m still allowing you to get your quantum meruit
evidence in but I’m not allowing evidence of the change orders.”
When a contract is otherwise unenforceable, recovery for services rendered may
be permitted in a quantum meruit action. (Long v. Rumsey (1938) 12 Cal.2d 334, 342; cf.

13.
Maglica v. Maglica, supra, 66 Cal.App.4th at p. 449 [“As every first year law student
knows or should know, recovery in quantum meruit does not require a contract”].) In an
action for quantum meruit, a party seeks to recover for the reasonable value of the
services rendered, as long as those services were of direct benefit to the recipient.
(Maglica v. Maglica, supra, at pp. 449, 451; see Chambers v. Kay (2002) 29 Cal.4th 142,
161; Palmer v. Gregg, supra, 65 Cal.2d at p. 660.) “The underlying idea behind quantum
meruit is the law’s distaste for unjust enrichment. If one has received a benefit which one
may not justly retain, one should ‘restore the aggrieved party to his [or her] former
position by return of the thing or its equivalent in money.’” (Maglica v. Maglica, supra,
at p. 449.)
There is no written contract between EJFCI and the Sahotas because Franks failed
to advise the Sahotas of the change to his business’s entity status during the course of the
construction period. As previously indicated, he entered into a written contract with
Bhupinder Sahota on behalf of E. J. Franks Construction. Subsequent to the execution of
that contract, and during the construction of the Sahotas’ residence, Franks’ business
became incorporated and his license was reissued to EJFCI. Nonetheless, despite a lack
of contract between the new entity and the Sahotas, and despite Franks’ failure to obtain
his clients’ signatures on the various change orders that appear as exhibit B to the
complaint, EJFCI is not precluded from bringing a quantum meruit cause of action for the
services it rendered, and the trial court did not err in this regard. (Long v. Rumsey, supra,
12 Cal.2d at p. 342; see Maglica v. Maglica, supra, 66 Cal.App.4th at p. 449.)
Arya Group, Inc. v. Cher, supra, 77 Cal.App.4th 610 does not compel a reversal as
the Sahotas argue. Arya Group, Inc. held that a contractor’s failure to comply with the
writing requirement imposed by former section 7164 did not absolutely preclude the
contractor from pursuing a breach of contract claim, and the contractor was allowed to
“seek to enforce its contract claim … to the extent [the property owner] would otherwise
be unjustly enriched as a result of her failure to compensate [the contractor] for the
reasonable value of its work on the … construction project.” (Arya Group, Inc. v. Cher,

14.
supra, at p. 618.) The court further stated: “If, for whatever reason, failure to compensate
the contractor will not result in the unjust enrichment of the owner, there will be no
recovery, regardless of what the contractor might have been entitled to collect under a
contract which conformed with the requirements of section 7164.” (Ibid., fn. 4.)
The appellate court in Arya Group, Inc. extensively relied upon Asdourian v. Araj
(1985) 38 Cal.3d 276. In Asdourian, the Supreme Court observed that “[g]enerally a
contract made in violation of a regulatory statute is void” and the court ordinarily will not
aid the enforcement of an illegal agreement or an agreement against public policy. (Id. at
p. 291.) But the court recognized the rule was not inflexible and there was an exception
permitting the enforcement of illegal contracts “to avoid unjust enrichment to the
defendant at the expense of the plaintiff. [Citation.]” (Ibid.)
The Supreme Court concluded in Asdourian that a contractor’s failure to comply
with the statutory requirement under former section 7159 that home improvement
contracts be in writing did not render oral agreements for residential remodeling
absolutely unenforceable. The court explained: “In compelling cases, illegal contracts
will be enforced in order to ‘avoid unjust enrichment to a defendant and a
disproportionately harsh penalty upon the plaintiff.’ [Citation.] ‘“In each case, the extent
of enforceability and the kind of remedy granted depend upon a variety of factors,
including the policy of the transgressed law, the kind of illegality and the particular
facts.”’ [Citation.]” (Asdourian v. Araj, supra, 38 Cal.3d at p. 292.) The court stated:
“[I]n this factual context, enforcing the oral agreements does not defeat the policy of the
statute. The penalty which would result from the denial of relief would be
disproportionately harsh in relation to the gravity of the violations.” (Id. at p. 294.) It
found a number of factors supported enforcement: (1) the owners were not part of the
class of unsophisticated consumers that the law was intended to protect, (2) misdemeanor
penalties provided in the statute were adequate to protect the underlying public policy, (3)
the contracts were not malum in se, and (4) the failure to comply with the statute was
“perhaps, understandable” because the contractor and the owners had been friends and

15.
had past business dealings. (Id. at pp. 292-294.) The Supreme Court determined that the
defendants’ retention of the benefits without compensation would result in the unjust
enrichment of the property owners. (Asdourian v. Araj, supra, at p. 293.) It concluded
that “[i]t will not defeat the statutory policy to allow plaintiff to recover for the
reasonable value of the work performed.” (Id. at p. 292.)
Here, the fact EJFCI did not enter into a written contract for the extra work, or did
not obtain signed change orders, does not preclude its recovery in quantum meruit. The
Sahotas would be unjustly enriched by the numerous changes and upgrades performed by
EJFCI were it prohibited from such recovery. There is significant evidence concerning
the extra work performed by EJFCI after April 12, 2005. That evidence was elicited
through the testimony of Franks, Joe Perez, Lorenzo Mejia, and Jose Angel Hernandez.
Moreover, the oral agreements between EJFCI and the Sahotas do not defeat the
policy of the statute. There is evidence in this record that the Sahotas are not
unsophisticated consumers, and denial of relief would be disproportionately harsh in
relation to the violation by EJFCI.
In sum, we find no error.
III. Interpretation of the Written Contract*
The Sahotas also argue the trial court’s failure to interpret the written contract
requires reversal because the alleged extra work was in fact work “specifically addressed
in the contract drafted by Mr. Franks.”
Significantly, we find that while the Sahotas claim the “trial court incorrectly
denied the Sahotas[’] request that it determine whether the items [Franks] claimed as
‘extras’ were in fact beyond the scope of the contract,” they have failed to support this
factual assertion with an appropriate reference to the record (Cal. Rules of Court, rule
8.204(a)(1)(C)). This court is not required to make an independent search of the record

*See footnote, ante, page 1.

16.
and may disregard any claims when no reference is furnished. (Nwosu v. Uba (2004) 122
Cal.App.4th 1229, 1246.) The allegation is thus rejected on this ground.
IV. Substantial Evidence in Support of Judgment*
Next, the Sahotas contend that EJFCI “failed to present ‘substantial evidence’ to
support the $66,000 award.” More specifically, they maintain EJFCI’s expert witness’s
testimony did not constitute substantial evidence because it was based on conjecture and
uncertainty. The Sahotas also contend the expert’s testimony lacked foundation.
Whether there is sufficient evidence, with or without expert testimony, is a
question we review under the substantial evidence test. The substantial evidence rule
requires us to “examine the entire record to determine whether there is any substantial
evidence, contradicted or uncontradicted, to support the court’s factual findings. Where
the evidence conflicts or is capable of conflicting inferences, the appellate court will not
substitute its deductions for those of the fact finder. [Citation.] Further, … this court will
not reweigh evidence, reappraise the credibility of witnesses, or resolve factual conflicts
contrary to the trial court’s findings, but only decide whether there is substantial evidence
to support these findings. [Citation.]” (Eidsmore v. RBB, Inc. (1994) 25 Cal.App.4th
189, 195, fn. omitted; see El Escorial Owners’ Assn. v. DLC Plastering, Inc. (2007) 154
Cal.App.4th 1337, 1357-1358.) The same is true for a damages award; we affirm if the
record, viewed most favorably to the award, discloses substantial evidence. (Fassberg
Construction Co. v Housing Authority of City of Los Angeles (2007) 152 Cal.App.4th
720, 746.)
Under Evidence Code section 801,

“If a witness is testifying as an expert, his testimony in the form of an
opinion is limited to such an opinion as is: [¶] … [¶] (b) Based on matter
(including his special knowledge, skill, experience, training, and education)
perceived by or personally known to the witness or made known to him at
or before the hearing, whether or not admissible, that is of a type that
reasonably may be relied upon by an expert in forming an opinion upon the

*See footnote, ante, page 1.

17.
 subject to which his testimony relates, unless an expert is precluded by law
from using such matter as a basis for his opinion.”
As provided in Evidence Code section 803, “The court may, and upon objection shall,
exclude testimony in the form of an opinion that is based in whole or in significant part
on matter that is not a proper basis for such an opinion.”
“The value of opinion evidence rests not in the conclusion reached but in the
factors considered and the reasoning employed. [Citations.] Where an expert bases his
conclusion upon assumptions which are not supported by the record, upon matters which
are not reasonably relied upon by other experts, or upon factors which are speculative,
remote or conjectural, then his conclusion has no evidentiary value. [Citations.] In those
circumstances the expert’s opinion cannot rise to the dignity of substantial evidence.”
(Pacific Gas & Electric Co. v. Zuckerman (1987) 189 Cal.App.3d 1113, 1135.)

“An expert opinion has no value if its basis is unsound. [Citations.]…
Evidence Code section 801, subdivision (b), states that a court must
determine whether the matter that the expert relies on is of a type that an
expert reasonably can rely on ‘in forming an opinion upon the subject to
which his testimony relates.’ (Italics added.) We construe this to mean that
the matter relied on must provide a reasonable basis for the particular
opinion offered, and that an expert opinion based on speculation or
conjecture is inadmissible. [Citations.]” (Lockheed Litigation Cases
(2004) 115 Cal.App.4th 558, 564.)
“‘[I]rrelevant or speculative matters are not a proper basis for an expert’s opinion.’”
(Sargon Enterprises, Inc. v. University of Southern California (2012) 55 Cal.4th 747,
770.) An expert opinion may not be based on speculative or conjectural data, and an
expert opinion that assumes facts contrary to proof destroys the evidentiary value of the
opinion. (Hyatt v. Sierra Boat Co. (1978) 79 Cal.App.3d 325, 338.)
A review of this record establishes expert witness4 Arnold Kiil’s testimony is
substantial evidence in support of the jury’s award of $66,000 in damages.

4EJFCI offered Kiil’s testimony as expert testimony regarding the reasonable value of the
various extra charges claimed. The Sahotas elected not to subject Kiil to voir dire. The trial

18.
 Kiil studied civil engineering at Pennsylvania State University after working for
his father in the construction business. He became a licensed general building contractor
in California and owned his own business in Merced for over 30 years. He estimated he
had built about 60 new construction homes during the course of his career.
Kiil was familiar with the Sahotas’ residence as he had been in it many times. He
offered testimony concerning the reasonable value to convert a closet to a bathroom, to
convert a bare attic space to a living space, to insulate all interior walls, to add shearing to
the entire exterior of the home, and to relocate a showerhead. As to the reasonable value
of the foregoing, Kiil’s estimates totaled approximately $34,300. Additionally, Kiil
testified that standard spray-on or “orange peel” texture is less expensive than a custom
textured surface such as an “imperfectly smooth” texture.
A review of the record does not support the Sahotas’ assertions. Kiil’s testimony
was based upon his 30 years’ experience in the construction field, including projecting
cost estimates for residential and commercial projects, and his having worked at the
Sahotas’ home. (Evid. Code, § 801, subds. (a), (b).)
Moreover, the Sahotas were provided with an opportunity to conduct a voir dire
examination of Kiil with specific regard to his qualifications as an expert witness on the
reasonable value of extra work performed at the Sahotas’ residence. They declined to do
so. As to the Sahotas’ argument that the trial court should have sustained their objections
to Kiil’s testimony as lacking foundation, we find no abuse of discretion by the trial court
in overruling said objections. (Summers v. A.L. Gilbert Co. (1999) 69 Cal.App.4th 1155,
1168 [trial court’s determination that expert testimony is admissible is reviewed for abuse
of discretion].)
Furthermore, Kiil’s testimony was not the only testimony addressing the extra
work performed at the Sahotas’ home. Franks himself testified as to the various costs

court found Kiil qualified as an expert to render an opinion as to the reasonable value of the extra
work performed.

19.
associated with the work performed, as did three subcontractors charged with performing
some of the actual work.
In particular, Franks’ own testimony was considered by the jury, including: that
the flooring cost exceeded the allowance provided for in the contract, the closet-to-
bathroom conversion required additional work by the framer, plumber and electrician, the
additional cost for the rubber sound barrier was approximately $4,500, the bare attic
space conversion to living space involved additional work from framing to finish, the
additional lighting and electrical work was performed by A-1 Electric and billed at
$2,650, the shower walls were tiled to a greater height at an additional cost of $1,875, the
custom interior texture cost was approximately $6,000 to $8,000, the “smart home”
communication system was installed for $10,000 and exceeded the contract price that
called for an alarm system, windows and doors were added that were not provided for in
the plans at an additional cost of approximately $1,555, certain changes were made that
required extra work by the plumbing contractor (including additional bathroom fixtures)
for an additional cost of approximately $4,200, installing insulation to all interior wall
spaces was an additional $3,000, the shearing of all exterior walls was approximately
$9,000, and laying the tile flooring in a diamond pattern with a border was an additional
$2,348.
Franks’ testimony was supported in part by the testimony of three subcontractors.
Joe Perez performed the extra work pertaining to the heightened shower wall tile and
shower upgrades. He billed $1,875 for the extra work and was paid that sum by Franks.
Moreover, Perez performed extra work in the form of laying tile downstairs in a diamond
pattern and adding a decorative border. The cost of that extra work was $2,348. Lorenzo
Mejia performed additional electrical work to accommodate extra can lights, exterior
lighting, and exterior appliance outlets. He billed a total of $2,280 for the extra work
performed. Jose Angel Hernandez testified he performed about three separate framing
changes over and above the job he originally bid, including building closets and adding

20.
shearing to the exterior of the home. Although he did not remember the costs associated
with the extra work, he was paid for that work by Franks.
During closing argument, counsel for EJFCI addressed the reasonable value of the
extra work performed and referenced the testimony in support thereof. During that
argument, counsel’s specific references to the values he contended should be assigned to
that work totaled between $55,515 and $68,515, depending upon whose testimony the
jury credited as to a specific value.
As to the Sahotas’ passing contention that the trial court abused its discretion in
allowing exhibit 116 to be admitted, it is rejected because the contention is utterly lacking
in reference to legal authority. (Cal. Rules of Court, rule 8.204(a)(1)(B); Benach v.
County of Los Angeles (2007) 149 Cal.App.4th 836, 852; see Eisenberg et al., Cal.
Practice Guide: Civil Appeals and Writs (The Rutter Group 2013) ¶ 9:21, p. 9-6.)
It is the jury’s role to determine which evidence to credit and which to disregard.
(Beck Development Co. v. Southern Pacific Transportation Co. (1996) 44 Cal.App.4th
1160, 1204.) As a reviewing court, we may not “reweigh evidence, reappraise the
credibility of witnesses or resolve factual conflicts contrary to the [jury’s] findings ….”
(Eidsmore v. RBB, Inc., supra, 25 Cal.App.4th at p. 195.) Because Kiil’s opinions are not
based on unsupported factual assumptions or sheer speculation and conjecture, we reject
the Sahotas’ argument that those opinions must be rejected. Moreover, viewing the
evidence in the light most favorable to the judgment, it is plain the $66,000 damage
award is supported by substantial evidence.
V. The Sahotas’ Breach of Contract Claim*
Finally, the Sahotas urge this court to “reverse the trial court’s decision finding
Mr. Franks did not breach the construction contract where [they] presented substantial
evidence in support of their claim for construction defects.” Specifically, they allege
both that Franks “presented insubstantial evidence to counter” their evidence, and that

*See footnote, ante, page 1.

21.
they presented “uncontroverted” evidence. Whether alleging their evidence was
uncontroverted, or that the opposing evidence was insufficient, we are not persuaded by
the Sahotas’ arguments.
“In deciding the sufficiency of the evidence, a reviewing court resolves neither
credibility issues nor evidentiary conflicts. [Citation.] Resolution of conflicts and
inconsistencies in the testimony is the exclusive province of the trier of fact. [Citation.]
Moreover, unless the testimony is physically impossible or inherently improbable,
testimony of a single witness is sufficient to support a [judgment]. [Citation.]” (People
v. Young (2005) 34 Cal.4th 1149, 1181; see Beck Development Co. v. Southern Pacific
Transportation Co., supra, 44 Cal.App.4th at p. 1204.) “‘Conflicts and even testimony
which is subject to justifiable suspicion do not justify the reversal of a judgment, for it is
the exclusive province of the trial judge or jury to determine the credibility of a witness
and the truth or falsity of the facts upon which a determination depends. [Citations.]’
[Citations.]” (Evje v. City Title Ins. Co. (1953) 120 Cal.App.2d 488, 492.) Evidence
credited by the trial court will be found sufficient to support a judgment unless it was
“‘unbelievable per se’” or such that “‘no reasonable person could believe the
testimony.’” (Ibid.; cf. Kircher v. Atchison, T. & S.F. Ry. Co. (1948) 32 Cal.2d 176, 183
[testimony of a single witness sufficient to support judgment unless it was “wholly
unacceptable to reasonable minds”].)

“If conflicting inferences may be drawn regarding a material fact the
appellate court is required to draw the inference favorable to the judgment.
‘Even if this court were of the opinion that that determination was wrong, it
would not have the power to substitute its deductions for those of the trial
court. For, as has so often been said, when opposing inferences may
reasonably be drawn from the facts in a case, the findings of the trial court
will not be set aside.’ [Citations.]” (Doupnik v. General Motors Corp.
(1990) 225 Cal.App.3d 849, 868.)
If the trier of fact determined the party with the burden of proof at trial failed to
meet that burden, our review becomes a question of whether the evidence compels a
finding in favor of the appellant as a matter of law. (Shaw v. County of Santa Cruz

22.
(2008) 170 Cal.App.4th 229, 279.) In which case, the question would then be whether
“the appellant’s evidence was (1) ‘uncontradicted and unimpeached’ and (2) ‘of such a
character and weight as to leave no room for a judicial determination that it was
insufficient to support a finding.’ [Citation]” (Ibid.)
Notably, the argument asserted is inaccurately stated. The trial court did not make
findings; rather, the jury was the trier of fact. With regard to the Sahotas’ breach of
contract claim, the jury expressly found that while the parties entered into a contract, the
Sahotas neither performed “all or substantially all of the significant things [it] required
them to do,” nor were they excused from having to do so.
Furthermore, there is substantial evidence in the record to support the jury’s
verdict. The Sahotas’ contentions are nothing more than requests for this court to
reweigh the evidence and to reweigh the credibility of the witnesses. This we will not do.
The jury plainly accorded more weight to the testimony of Franks and expert Kiil
than it did to the testimony of Michael Jundt, the Sahotas’ construction defect expert
witness. It is the jury’s exclusive province to determine the credibility of witnesses.
(Evje v. City Title Ins. Co., supra, 120 Cal.App.2d at p. 492.) The testimony proffered in
opposition to Jundt’s testimony was not unbelievable per se, nor was it testimony that no
reasonable person could believe. (Ibid.) Moreover, the jury could have been persuaded
by Franks’ testimony, Kiil’s testimony, or a combination thereof. Both testified in
contradiction to the testimony offered by Jundt in support of the Sahotas’ claims. The
testimony of a single witness is sufficient to support the judgment, and the testimony of
both Franks and Kiil support the judgment against the Sahotas on their claim for breach
of contract. (Beck Development Co. v. Southern Pacific Transportation Co., supra, 44
Cal.App.4th at p. 1204; see also Kircher v. Atchison, T. & S.F. Ry. Co., supra, 32 Cal.2d
at p. 183.)
Further, while Jundt may be more educated than Kiil, that is not a reason to
reverse the jury’s findings below. It was the jury’s responsibility to make credibility
determinations and weigh the expert testimony. (Foreman & Clark Corp. v. Fallon

23.
(1971) 3 Cal.3d 875, 890; County of Monterey v. W. W. Leasing Unlimited (1980) 109
Cal.App.3d 636, 646.) It did so and found against the Sahotas.
The evidence concerning the various construction defects alleged by the Sahotas
was plainly in conflict. The testimony offered by Jundt and Kerry Wolf was contradicted
by testimony offered by Franks, Kiil, and John Grissom. Evidentiary conflicts are also
the exclusive province of the jury. (Beck Development Co. v. Southern Pacific
Transportation Co., supra, 44 Cal.App.4th at p. 1204; Doupnik v. General Motors Corp.,
supra, 225 Cal.App.3d at p. 868; Evje v. City Title Ins. Co., supra, 120 Cal.App.2d at p.
492.)
The Sahotas’ evidence was neither “uncontradicted and unimpeached,” nor “of
such a character and weight” as to preclude judicial determination that it was insufficient.
(Shaw v. County of Santa Cruz, supra, 170 Cal.App.4th at p. 279.)
In conclusion, drawing all reasonable inferences from the jury’s verdict, we find
there is sufficient evidence to support the verdict as the correct one. (Howard v. Owens
Corning (1999) 72 Cal.App.4th 621, 635.)
VI. Request for Judicial Notice*
In their reply brief, the Sahotas request this court take judicial notice of the
Contractors State License Board Web site and, particularly, the following:
http://www.cslb.ca.gov/Contractors/MaintainLicense/ChangeBusinessEntity.asp. Their
request ignores basic rules of appellate procedure. California Rules of Court, rule
8.252(a)(1) mandates requests for judicial notice must be made by a separate formal
noticed motion pursuant to rule 8.54. By including the request as a part of the reply brief,
versus a separately noticed motion, EJFCI was afforded no opportunity to address the
request. Moreover, the information contained in the request for judicial notice relates to
information not presented to or considered by the trial court. “Generally, ‘“when
reviewing the correctness of a trial court’s judgment, an appellate court will consider only

*See footnote, ante, page 1.

24.
matters which were part of the record at the time the judgment was entered.” [Citation.]’
[Citations.] It is a fundamental principle of appellate law that our review of the trial
court’s decision must be based on the evidence before the court at the time it rendered its
decision. [Citations.] The [Sahotas] have not cited any exceptional circumstances that
would justify a deviation from this rule in this appeal.” (California School Bds. Assn. v.
State of California (2011) 192 Cal.App.4th 770, 803; see Optional Capital, Inc. v. DAS
Corp. (2014) 222 Cal.App.4th 1388, 1395, fn. 5 [request for judicial notice improperly
raised for first time in reply brief].) Furthermore, the information on the Web site in
2014 is not relevant to any licensing requirements or procedures in place when this
dispute arose, nearly a decade earlier. (See Ketchum v. Moses (2001) 24 Cal.4th 1122,
1135, fn. 1 [to take judicial notice, matter must be relevant to a material issue]; Mangini
v. R.J. Reynolds Tobacco Co. (1994) 7 Cal.4th 1057, 1063-1064, overruled on other
grounds in In re Tobacco Cases II (2007) 41 Cal.4th 1257, 1276.)
For the foregoing reasons, the request for judicial notice is denied.
DISPOSITION
The judgment is affirmed. Costs on appeal are awarded to EJFCI.

___________________________
PEÑA, J.
WE CONCUR:

________________________________
POOCHIGIAN, Acting P.J.

________________________________
SARKISIAN, J.†

†Judge of the Fresno Superior Court assigned by the Chief Justice pursuant to article VI,
section 6 of the California Constitution.

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