Filed 4/15/22 Westco Petroleum Distributors, Inc. v. MCW Fuels, LLC CA2/3
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
WESTCO PETROLEUM B303859
DISTRIBUTORS, INC.,
Los Angeles County
Cross-complainant and Super. Ct. No. EC062294
Appellant,
v.
MCW FUELS, LLC, et al.,
Cross-defendants and
Respondents.
APPEAL and PURPORTED APPEAL from an order of
dismissal following entry of order granting summary adjudication
of the Superior Court of Los Angeles County, Ralph C. Hofer,
Judge. Affirmed; purported appeal treated as petition for writ
of mandate, petition denied.
Omrani Law and Sepehr Omrani; Robert M. Ungar for
Cross-complainant and Appellant.
TQM Law Corporation, Alon Hacohen; Jeff Lewis Law and
Jeffrey Lewis for Cross-defendants and Respondents MCW Fuels,
Inc., MCW Fuels, LLC, and Aleksandr Blyumkin.
Reuben Raucher & Blum and Timothy D. Reuben for Cross-
defendant and Respondent Stan Boyett & Son, Inc.
No appearance for Cross-defendant and Respondent
Phillips 66 Company.
_________________________
Westco Petroleum Distributors, Inc. (Westco) appeals from
an order dismissing cross-defendants MCW Fuels, LLC, formerly
known as MCW Fuels, Inc.1 (MCW), Aleksandr Blyumkin
(MCW’s principal), Stan Boyett & Son, Inc. (Boyett), and
Phillips 66 Company (Phillips) from Westco’s second amended
cross-complaint. The trial court dismissed those cross-defendants
after it granted MCW’s motion for summary judgment,
or alternatively, summary adjudication, finding Westco’s
assignment to MCW of five fuel distribution contracts
for the delivery of Phillips’s fuel were valid. The trial court
simultaneously denied, and found moot, Westco’s cross-motion
for summary adjudication asserting the assignments were
invalid.
Westco contends it presented admissible evidence
demonstrating the five assignments were void for failure of
delivery, failure of consideration, and/or cancellation. It argues
the orders must be reversed and either its motion for summary
adjudication granted, or the matter remanded for a trial on the
1 MCW Fuels, Inc. was formerly known as McWhirter
Distributing Co., Inc.
2
issue of the validity of the assignments. Finding no prejudicial
error, we affirm the orders as to Blyumkin. Westco appealed
from a nonappealable order as to MCW, Boyett, and Phillips.
Treating that part of Westco’s appeal as a petition for writ
of mandate, we deny the petition.
FACTS AND PROCEDURAL BACKGROUND
In 2012, MCW was a fuel distribution company. It bought
fuel from refineries, including Phillips, and distributed it to
local gas stations. Westco similarly bought and distributed fuel.
Both MCW and Westco were resellers and distributors of fuel
for Phillips under separate “Master Branded Reseller Fuel
Distribution Agreement[s]” with Phillips (reseller or master
reseller agreements). At the time, Sami Dabbas was MCW’s
COO. Antone Nino ran Westco. He was its CEO and president,
a director, and majority shareholder.2 Westco’s then-legal-
counsel Kamal A. Bilal also was one of its officers and directors
and had a 24 percent shareholder interest in the company.3
1. 2012 Master Agreement
In June 2012, MCW entered into a written “Master
Agreement” with Westco and Nino for the purchase of 16 branded
reseller fuel distribution agreements (fuel contracts)—through
2 MCW alleged Nino claimed to be Westco’s sole shareholder.
Nino died in January 2014. MCW sued Nino’s personal
representative, and Westco named the administrator of his estate
as a cross-defendant. Neither is a party to this appeal.
3 Bilal is a defendant and cross-complainant in this action.
He is not a party to this appeal.
3
their assignment to MCW—in two phases.4 (One fuel contract
was removed from the deal for a total of 15.) Phase one involved
MCW’s purchase of seven fuel contracts for $1 million. MCW
paid Westco for those fuel contracts in June 2012; they are not
part of this dispute. Phase two involved the sale of the remaining
contracts.
On August 20, 2012, MCW and Westco signed a First
Amendment to the Master Agreement, effective June 14, 2012.
The amendment separated phase two of the sale into two parts:
(1) MCW’s payment of $300,000 to Nino—for Westco’s and
Nino’s benefit—by September 1, 2012, for the purchase of three
fuel contracts with Nino-owned gas stations (phase 2.1); and
(2) MCW’s payment of $700,000 to Nino—again for both Westco’s
and Nino’s benefit—by December 15, 2012, for the remaining
six fuel contracts (phase 2.2).5 Westco does not dispute the sale
and assignment of the phase 2.1 fuel contracts to MCW.
On November 30, 2012, MCW learned one of the
gas stations that was part of the phase 2.2 closing had been
“ ‘debranded,’ ” and a lawsuit had been filed against Westco.
MCW alleged it, Nino, and Westco mutually agreed to modify
the amended 2012 Master Agreement so that Nino and Westco
would not sell the assignments for the last six gas stations.
Westco contends MCW gave notice on November 30, 2012—
through an email from its attorney John Tiedt to Bilal (acting
as Westco’s attorney)—that it was terminating the 2012 Master
4 The fuel contracts were with Southern California Phillips-
branded gas stations for the delivery of Phillips fuel. Nino
owned, through a partnership, eight of those gas stations.
5 For ease of reference only, we adopt MCW’s
characterization of the different closings.
4
Agreement as to those assignments and that any purchase would
be under a new agreement. The email states, “MCW will not
buy the remaining 6 assignments today pursuant to the Master
agreement as Westco could not deliver [the sixth site] by today
and therefore, MCW deems its obligations to have been
discharged. [¶] [Dabbas] will contact [Nino] to discuss buying
assignments pursuant to a new agreement.”
2. 2013 Master Assignment Agreement and Assignments
On May 21, 2013, Westco and MCW signed a Master
Assignment Agreement (2013 Master Agreement), effective
June 1, 2013, for the sale of the fuel contracts for the remaining
five gas stations that had been subject to phase 2.2 of the
closing.6 The parties concurrently executed five assignment
agreements, one for each station’s fuel contract, also effective
June 1, 2013.
The 2013 Master Agreement provided MCW would pay
Westco a total purchase price of $750,000 for the five assigned
fuel contracts. A first payment of $200,000 was to be used as
a credit on existing debt owed to MCW by eight gas stations
from earlier fuel deliveries. MCW was to make a “second
payment” of $550,000 to Westco “upon” Phillips’s approval of
the agreement and all assignments. Under the purchase price
provision, a subsection entitled “Voidable Agreement” provides,
“MCW will have no obligation to pay
Westco unless all Assignments have been
signed by all parties. If [ ] Phillips fails or
refuses to approve this Agreement and the
6 The parties agreed to exclude the debranded station. On
appeal, Westco contests the validity of these five assignments
only.
5
Assignments by July 3, 2013 (‘Expiration Date’)
or [ ] Phillips sends a written rejection of this
Agreement and/or the Assignments, then this
Agreement and the Assignments are void and
Westco must return the first payment of . . .
$200,000[ ] to MCW within five . . . business
days of the receipt of the written rejection by
[ ] Phillips or the Expiration Date.”
The closing provision immediately follows. It provides
for the closing of the transaction to occur on July 3, 2013, “or
on such other date as the parties mutually agree in writing.”
The provision continues,
“Time is of the essence and Westco agrees that
it will promptly work to close this transaction
by no later than July 3, 2013. If this
Agreement is delayed beyond July 3, 2013 by
Westco then MCW has the option to terminate
this Agreement and require immediate return
of the first payment.”7
Both the 2012 and 2013 Master Agreements include
the following integration/no-oral-modification clause: “This
Agreement . . . is a complete statement of the terms and
conditions concerning the subject matter of this Agreement
and it may not be modified, amended, altered or
supplemented, discharged or terminated, except by
7 The provision also gives MCW the ability to conduct due
diligence and the “unilateral right to terminate” the agreement
before the closing date if its due diligence were to reveal “any
material misrepresentations or material inaccuracies.”
6
an agreement in writing executed by each of the parties
hereto.” Each assignment agreement also contained a
no-oral-modification clause.
In June 2013, a dispute allegedly arose between Bilal and
Nino over, among other things, Bilal’s entitlement to 24 percent
of any sum paid to Westco, and whether his consent to the sale
of the assignments was required. On appeal, Westco does not
dispute Nino’s authority to enter into the 2012 or 2013 Master
Agreements and to assign the five fuel contracts to MCW on
behalf of Westco.8
On June 21, 2013, after having received an email from
Bilal stating he must consent to selling the fuel contracts,
MCW’s attorney Tiedt replied, “Since money never changed
hands and Westco did not perform, there will be a cancellation
of the contract, not a termination. I am drafting the cancellation
right now.” On June 25, 2013, MCW’s COO Dabbas signed a
“Cancellation of Master Assignment Agreement” that purported
to cancel the 2013 Master Agreement and related assignments,
effective June 24, 2013. The signature blocks for Westco and
Nino are blank.
On August 14, 2013, MCW, Westco, and Nino entered
an “Authorization Verification and Indemnity Agreement”
(2013 Authorization Agreement), effective June 1, 2013.
8 In its own motion and in response to MCW’s motion,
Westco argued Nino did not have authority to enter into
the transactions at issue on behalf of Westco. As Westco has
abandoned the issue of lack of authority on appeal, we presume
the trial court correctly ruled Nino had authority to enter into
the disputed transactions on behalf of Westco, and, if he exceeded
his authority, Westco’s sole remedy was with Nino through a
shareholder dispute.
7
Thatagreement’s recitals refer to and incorporate the parties’
earlier 2012 and 2013 Master Agreements. As to the 2013
Master Agreement, the recitals state,
“D. A Second Master Assignment
Agreement was entered into on June 1, 2013
for the assignment of five . . . [fuel contracts]
for [f]ive . . . gas stations in Southern
California. A copy of the June 1, 2013 Second
Master Assignment Agreement is incorporated
herein as though fully set forth.
“E. The parties desire to negotiate
further agreements and as a condition
precedent to negotiations, the parties have
now agreed to enter into an Authorization
Verification and Indemnity Agreement.”9
Before August 21, 2013, Westco bounced an electronic
funds transfer to Phillips for more than $270,000. Phillips placed
Westco on a “ ‘credit hold’ ” and stopped supplying fuel to Westco
for the five gas stations subject to the 2013 Master Agreement
and assignments, which were the only stations Westco still
serviced. Phillips would not fill Westco’s fuel orders as long as
the credit hold remained. By the end of August 2013, due to
further missed payments, Westco owed Phillips about $1 million.
Phillips never lifted Westco’s credit hold.
On August 21, 2013, after Phillips cut off Westco’s fuel
supply, Tiedt told Bilal in an email that MCW wanted “to take
9 Among other things, the 2013 Authorization Agreement
included Westco’s representation and warranty that Nino
was authorized to enter into the 2012 Master Agreement and
amendment, and the 2013 Master Agreement.
8
the sites on a temporary basis just to supply fuel so that the
stations won’t be shut down. [Phillips] is ok with that. This is
a temporary fix and we agree to takeover [sic] the sites until
you and [Nino] resolve your issues. It is again just a temporary
situation.” The next day several emails were sent among,
forwarded, or copied to, Tiedt, Bilal, Nino, Dabbas, and William
Thomas, the Phillips sales representative who handled Westco’s
and MCW’s accounts. Addressing Bilal, Tiedt wrote,
“MCW is not buying contracts from Westco. . . .
MCW has simply offered to take over the 5 sites
at issue on a temporary basis as a favor to
Westco and [ ] Phillips. Nothing more. [¶] The
dispute you have with your partner [Nino] is all
the more reason not to consider any deal with
Westco until the Westco shareholders resolve
their differences. I have advised my clients
not to make any offer to purchase contracts
and as [Dabbas] told you, he has no interest
in making any such offer at this time. You and
[Nino] must work out whether you will honor
your contracts with your customers or just
let the stations shut down.”
Thomas wrote that if there was not going to be a “temp
transfer of Westco sites to MCW,” then Westco would have
to wire funds to Phillips “to get [the] fuel released to the
6 sites.” Nino responded to Thomas that the transfer was
temporary to help Westco’s customers stay in business,
and—as the president and majority stockholder of Westco—
asked Thomas to complete the transaction.
After much back and forth, Tiedt, addressing both Bilal
and Nino, wrote:
9
“[Nino] as chief executive officer of Westco,
has asked MCW to step in and deliver fuel
to maintain Westco’s customer base. . . . [¶]
Due to the fact that Westco has lost its credit
with [Phillips], Westco cannot deliver fuel
to its customers. Westco cannot perform its
contractual obligations. [Nino], on behalf of
Westco has given MCW [a]pproval to
temporarily deliver fuel. MCW will be paid
for selling and delivering fuel. . . . MCW
will gladly turnover [sic] the fuel delivering
responsibilities when instructed. Further,
we are hopeful that both of you work out your
differences. In the interim, MCW will do its
best to handle the 5 sites in question.” 10
In August 2013, MCW and Westco asked Phillips to consent
to the assignment to MCW of Westco’s rights under its reseller
agreement with Phillips to, among other things, sell Phillips’s
fuel to the five gas stations that were subject to the assignments.
Phillips consented to the transfers. Nino on behalf of Westco,
and Dabbas on behalf of MCW, signed “Ship to Transfer - Close”
and “Ship to Transfer - Create” customer status update forms,
respectively, removing the stations from Westco’s reseller
agreement with Phillips and adding them to MCW’s reseller
agreement with Phillips. The transfer forms had effective dates
of August 12, 19, and 23, 2013.
10 The trial court sustained MCW’s objections to the exhibits
of these email exchanges as inadmissible hearsay and lacking
foundation and authentication.
10
The ship to transfer forms include an “Assumption of
Responsibility Agreement/Unamortized Program Funds.” On the
forms governing three of the five stations, that agreement states:
“In consideration of [Phillips’s] acceptance
and administration of this transfer, MCW . . .
(Receiving Reseller) agrees to assume the
responsibility and obligation for payment(s)
to [Phillips] of the unamortized amounts listed
above, if any, previously the responsibility of
Westco . . . (Current Reseller) effective on the
date hereof . . . . If during the amortization
period(s) the Ship To(s) is debranded . . . , or
Receiving Reseller ceases to be a [Phillips]
Reseller, Receiving Reseller hereby agrees to
repay [Phillips] the remaining unamortized
amount(s) listed above. Current Reseller
shall be released from any further liability
to [Phillips] for the payment of the aforesaid
amount(s) upon Receiving Reseller’s
assumption of responsibility for such payment.
[Phillips] will accept and administer this
transfer when Receiving Reseller has executed
a CSU (Ship to Transfer-Create) and Current
Reseller has executed a corresponding CSU
(Ship to Transfer-Close).”
The total unamortized amount listed on the forms for the three
stations is $222,124.20. (Similar language appears on the forms
for the other two stations, but no amounts were listed as due.)
Effective August 23, 2013, MCW and Phillips executed
an amendment (the 30th) to their master reseller agreement
to add the five stations, transferring to MCW the right and
obligation to deliver Phillips’s fuel to them.
11
3. Events following the transfer of the fuel contracts
On September 23, 2013, Bilal sued Nino, Westco, and other
entities (Los Angeles Superior Court Case No. BC522207), and
filed a verified first amended complaint on January 13, 2014. In
his original complaint, Bilal alleged that, in August 2013, Westco
“transferred the remainder of its valuable contract rights to resell
branded gasoline to [MCW]. Thereafter, [Westco] ceased all of its
gasoline distribution business.” Bilal made the same allegation
in the verified first amended complaint, but based it on
information and belief. He also alleged on information and belief
that, in August 2013, Nino transferred Westco’s remaining assets
to MCW, “namely[,] valuable branded gasoline reseller rights,”
without authorization.11
On December 17, 2013, Nino’s and Westco’s newly-retained
attorney Robert Scapa wrote to Phillips to inform it that, to raise
funds to pay Westco’s debt to Phillips, Westco planned to “market
and sell” five gas stations covered under its reseller agreement
with Phillips and that agreement. The listed stations were
those subject to the assignments that had been added to MCW’s
reseller agreement. Nino died in late January 2014. Bilal
became Westco’s sole director and CEO.
On March 6, 2014, Bilal wrote to Phillips, in his capacity
as Westco’s CEO, stating,
11 Bilal alleged the lawsuit was seeking “to redress” Nino’s
and others’ illegal diversion of income, profits, and assets from
Westco, and that diversion had divested Bilal of his share of
the income and profits and denied Bilal his proportionate share
of the value of Westco, whose assets were “seize[d]” in disregard
of Bilal’s rights as a shareholder and director.
12
“As you know, five . . . contracts were
transferred from [Westco] to MCW in or about
August 2013. Under the terms of a Master
Purchase Agreement, MCW is obligated to
pay [Westco] $700,000 for the transfer of the
five . . . contracts. To date MCW has been
unwilling to pay the agreed upon purchase
price for the five . . . contracts. [¶] [Westco] is
currently exploring its remedies, including a
demand that MCW transfer back the five . . .
contracts to [Westco]. Is the consent of Phillips
. . . necessary for the transfer back of the five
. . . contracts from MCW to [Westco]?”
On April 18, 2014, MCW sued Westco, Bilal, Nino’s
representative, and others. It filed its operative first amended
complaint (FAC) on August 6, 2014. MCW alleged causes of
action for fraud, negligent misrepresentation, breach of written
contract, and others. It alleged Bilal interfered in MCW’s
transactions with Westco and Nino and revealed, for the
first time in mid-June 2013, that Nino was not the sole owner
of Westco, claiming a 24 percent share of any amounts paid
to Westco.
At some point in December 2014, cross-defendant (and
cross-complainant) Boyett acquired the June 2013 assignments
for the five fuel contracts as part of its purchase of certain assets
from MCW.
Westco filed a cross-complaint on February 13, 2015,
and its operative second amended cross-complaint (SACC) on
13
August 16, 2016,12 asserting several causes of action, including
breach of contract, intentional interference with contract, and
conversion, among others. Westco alleged the assignments of the
five fuel contracts were unauthorized and without consideration,
and that Westco remained the legal owner of the contracts.
Boyett and Phillips each filed cross-complaints for indemnity—
Boyett against Westco and MCW and Phillips against Westco
and Bilal.
4. Summary judgment proceedings
In September 2017, the trial court stayed the matter
pending the outcome of Bilal’s appeal from a judgment of
dismissal in case number BC522207.13 The trial court excepted
from the stay order the issue of “the validity or invalidity of
the assignments” of the fuel contracts to MCW. It ordered the
unstayed matter “proceed first to the adjudication of whether
Westco . . . carries its burden to establish the invalidity of the
assignments” of the fuel contracts to MCW. In March 2019,
the court bifurcated the unstayed matter, and set the issue
for trial on November 4, 2019, with motions for summary
judgment/adjudication on the issue to be heard September 20,
2019.
Westco and MCW filed cross-motions for summary
adjudication and summary judgment, or alternatively, summary
12 Westco originally cross-complained against cross-
defendants MCW, Blyumkin, Boyett, Dabbas, Nino’s estate,
Nasrin Nino, Phillips, David Sutton, and Tiedt and related
entities. Westco settled with Sutton and the Tiedt parties
before filing its SACC.
13 That case was before a different judicial officer. The
appellate court reversed the judgment.
14
adjudication, respectively. Relevant to this appeal, MCW argued
Westco could not meet its burden to prove the assignments
were invalid, Westco was estopped from denying the validity
of the assignments, and Westco had admitted the validity of
the assignments. Westco argued the assignments were “void
ab initio and invalid” for lack of authority—which it does not
raise on appeal, for failure of delivery and consideration, and
due to cancellation by MCW. Westco thus contended the five
fuel contracts were never assigned, and it remained their
rightful owner.
On October 4, 2019, the trial court heard argument on
the parties’ cross-motions.14 Westco (joining Bilal) argued the
assignments were invalid for nondelivery because the conditions
to their delivery—Phillips’s approval by July 3, 2013, and MCW’s
$550,000 payment to Westco—never occurred, and the evidence
showed the parties intended to cancel their agreement. Westco
asserted it was “not seeking to invalidate anything.” Rather,
its position was that the assignments were void from the outset
for nonperformance and cancellation.
The court rejected Westco’s argument that there had
been a cancellation. The court construed the parties’ various
agreements as part of one overall transaction, and noted the
five assignments at issue were listed in the original 2012 Master
Agreement. It thus construed the 2013 Master Agreement as
implementing the 2012 Agreement, explaining “[t]here were
negotiations going back and forth about how to implement this
sale under the 2012 agreement.” The court noted, “Everything
14 The court questioned counsel at the originally-scheduled
September 20, 2019 hearing and, on its own motion, continued
the hearing to October 4.
15
was going fine until you [Bilal] inserted yourself and said, ‘I’ve
got to approve this deal,’ because you wanted your cut out of
the sale.” The court continued,
“So when you sent that letter [in June 2013],
after having negotiated with these parties for
a year and not telling them that ‘Oh, I am a
shareholder. I have to approve the deal too.
There is a shareholder agreement that
you don’t know about,’ that caused further
negotiations to implement the 2012 deal.
It didn’t create a new deal because you came
in and tried to disrupt the original deal and
tried to undo a deal that was done in 2012. [¶]
So it didn’t create a new deal. It just created
a couple of obstacles that had to be overcome to
finalize the implementation of the transfer. . . .
There was no cancellation. . . . And your
conduct caused additional negotiations to take
place. . . . [A]nd it all relates to you getting
your $300,000 or whatever you think you were
supposed to get out of that deal. That’s Nino’s
fault, not MCW’s fault.”
The court also rejected Westco’s argument that the parties
had not performed, noting Phillips “did approve the transaction
and the assignments, and the money was transferred.” The court
admonished Bilal, “Don’t tell me the evidence says they didn’t
perform,” after explaining,
“There’s evidence of a $1.3 million purchase
[referring to the earlier, undisputed
assignments], and then there’s evidence of
an assumption of debt, which comes out to
$2 million. . . . They spent $2 million, and
16
you want to undo this deal . . . , and you don’t
have the money to pay them back when you
. . . undo this deal. [¶] . . . [¶] They can’t do
anything and reverse anything. Westco . . .
is not in business anymore. They’re basically
a defunct company. So there’s nothing they can
do to perform under any of these contracts.”
After hearing argument, the court adopted its tentative
ruling—granting MCW’s motion and denying Westco’s motion
and finding it moot—as its final ruling. The court’s written
ruling granted MCW’s motion on several independent and
alternative grounds, including: there was no cancellation as a
matter of law because there was no evidence of a writing signed
by both parties as required under the terms of the agreements;
Westco’s evidence of “any purported cancellation of the
assignments” was barred by the parol evidence rule under
the agreements’ integration clauses; Westco admitted the
validity of the assignments in correspondence with Phillips;
the unambiguous language of the agreements demonstrated
the parties’ intent in executing the assignment agreements
was “to assign the rights” under the fuel contracts from Westco
to MCW; and Westco was estopped from denying the validity
of the assignments as a matter of law as the agreements recited
Nino’s authority to enter into the transactions.
On October 3 and 7, 2019, the court entered orders
sustaining and overruling the parties’ evidentiary objections
to evidence submitted in support of and in opposition to their
cross-motions.15 On October 24, 2019, the court entered its order
15 Westco does not challenge these evidentiary rulings on
appeal. It thus has forfeited any claim that we should consider
17
granting MCW’s motion, denying Westco’s motion and finding
it moot, as well as ordering the assignments of the fuel contracts
to MCW for the five gas stations “were valid.” Finally, on
December 10, 2019, the court ordered the dismissal of MCW,
Blyumkin, Boyett, and Phillips from Westco’s SACC with
prejudice based on its order granting summary adjudication
on the validity of the assignments. Westco appealed.
DISCUSSION
Essentially, Westco contends the five assignments were
(1) void because MCW cancelled the 2013 Master Agreement—
thus, the assignments were never delivered; (2) void for failure
of condition precedent—also a failure of delivery—when Phillips
did not approve them by July 3, 2013; and (3) void for failure of
consideration when MCW did not pay Westco $550,000, which
Westco describes as a failed concurrent condition. It contends
triable issues of fact exist as to the parties’ intent to transfer
title of the fuel contracts.
evidence to which MCW’s or Boyett’s evidentiary objections
were sustained, or exclude evidence to which its objections were
overruled. (Fritelli, Inc. v. 3520 North Canon Drive, LP (2011)
202 Cal.App.4th 35, 41 [appellant who “does not attack the
[trial court’s evidentiary] rulings on appeal . . . forfeit[s] any
contentions of error regarding them”]; see also Soto v. Union
Pacific Railroad Co. (2020) 45 Cal.App.5th 168, 182 [appellant
who failed to challenge on appeal trial court’s overruling of her
hearsay objection to testimony admitted in support of defendant’s
motion for summary judgment forfeited that claim]; Lopez v.
Baca (2002) 98 Cal.App.4th 1008, 1014–1015 (Lopez) [considering
certain evidence offered in opposition to summary judgment “to
have been properly excluded” where appellant did not challenge
ruling sustaining objections to that evidence on appeal].)
18
1. Westco’s appeal as to MCW, Boyett, and Phillips
“An appealable judgment or order is a jurisdictional
prerequisite to an appeal.” (Connell v. Superior Court (1997)
59 Cal.App.4th 382, 392; Code Civ. Proc., § 904.1.) The trial
court’s order of dismissal following entry of its order granting
MCW’s motion for summary adjudication on Westco’s second
amended cross-complaint is an appealable order as to Blyumkin,
but not as to MCW, Boyett, and Phillips. The order of dismissal
resolved all issues in the matter between Westco and Blyumkin,
who has no claims pending against Westco. (See, e.g., Aixtron,
Inc. v. Veeco Instruments Inc. (2020) 52 Cal.App.5th 360, 387
[recognizing direct appeal may be taken from a judgment that is
final as to a party].) But, at the time the order of dismissal was
entered, MCW’s FAC still was pending against Westco, as were
Boyett’s and Phillips’s separate cross-complaints. The order of
dismissal, therefore, was not a final appealable order as to them.
(See California Dental Assn. v. California Dental Hygienists’
Assn. (1990) 222 Cal.App.3d 49, 59 (California Dental Assn.)
[no appealable final judgment “with respect to parties as to whom
a cross-complaint remains pending even though the complaint
has been fully adjudicated”].)
We asked the parties for supplemental briefing on the issue
of whether we should dismiss Westco’s appeal as to MCW, Boyett,
and/or Phillips. In response, Westco asked us to hear the merits
of the entirety of its appeal by treating its appeal as to those
three cross-defendants as a petition for writ of mandate; MCW
informed us it had filed a request to dismiss its pending FAC
against Westco and Bilal (without prejudice), disposing of all
issues between them, and asked us to hear the merits of Westco’s
appeal to avoid unnecessary delay and inefficient resolution
of claims; and Boyett asked us to dismiss the appeal as to it.
Phillips did not respond.
19
We have discretion to treat a purported appeal from
a nonappealable order as a petition for writ of mandate. (H.D.
Arnaiz, Ltd. v. County of San Joaquin (2002) 96 Cal.App.4th
1357, 1366.) The single issue raised by Westco’s appeal—
whether the trial court erred in finding the five assignments
were valid—requires us to review the same record and perform
the same legal analysis as to each respondent. As we must
resolve the appeal as to Blyumkin now, the interests of judicial
economy will be better served if we resolve the issues as to
all respondents at this time. (G.E. Hetrick & Associates, Inc. v.
Summit Construction & Maintenance Co. (1992) 11 Cal.App.4th
318, 325–326 (G.E. Hetrick) [treating appeal as to parties
against whom a cross-complaint was still pending as a petition
for writ of mandate rather than dismissing appeal as to all
but one defendant]; Olson v. Cory (1983) 35 Cal.3d 390, 401.)
Moreover, Blyumkin is jointly represented with MCW,
and Boyett joined in MCW’s brief. Although Boyett asked us
to dismiss Westco’s appeal, Boyett did not originally contest
our jurisdiction (G.E. Hetrick, supra, 11 Cal.App.4th at p. 326)
and will not be prejudiced if we consider the merits as to all
respondents now. Indeed, not to consider the merits of Westco’s
appeal as to all parties would relegate MCW—the party who
moved for summary adjudication in the first place and filed the
only respondent’s brief (with Blyumkin)—to an amicus curiae.
(California Dental Assn., supra, 222 Cal.App.3d at p. 60
[dismissing appeal as to plaintiffs with pending cross-complaint
would result in “the very fragmentation and multiplicity of
appeals that the final judgment rule seeks to avoid” and would
“remit the principal plaintiff and defendant to roles as amicus
bystanders while a controversy that is principally theirs resolves
itself”].) Accordingly, we exercise our discretion to treat Westco’s
20
defective appeal as to MCW, Boyett, and Phillips as a petition
for a writ of mandate. (Ibid.)
2. Summary adjudication and standard of review
Summary adjudication is proper if the papers submitted
show there is no triable issue as to any material fact and the
moving party is entitled to prevail on a cause of action as a
matter of law. (Code. Civ. Proc., § 437c, subds. (c), (f)(1)–(2);
Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850
(Aguilar).) A defendant (or cross-defendant) moving for summary
adjudication has the initial burden to show the plaintiff (or
cross-complainant) cannot establish one or more elements of
the challenged cause of action or that there is a complete defense
to that cause of action. (Code Civ. Proc., § 437c, subd. (p)(2).)
If the defendant (or cross-defendant) makes a sufficient showing,
the burden then shifts to the plaintiff (or cross-complainant)
to demonstrate a triable issue of material fact exists. (Ibid.)
A triable issue of fact exists if the evidence would allow a
reasonable trier of fact to find the underlying fact in favor
of the party opposing the motion. (Aguilar, at p. 850.)
We review the grant of a motion for summary adjudication
de novo, in the same manner as we would on an appeal from
the grant of summary judgment. (Schofield v. Superior Court
(2010) 190 Cal.App.4th 154, 156; see Aguilar, supra, 25 Cal.4th
at p. 860.) “[W]e must independently examine the record
to determine whether triable issues of material fact exist.”
(Saelzler v. Advanced Group 400 (2001) 25 Cal.4th 763, 767.)
In so doing, “we must view the evidence in a light favorable”
to the nonmoving party, “resolving any evidentiary doubts or
ambiguities” in that party’s favor. (Id. at p. 768.) We consider
“all the evidence set forth in the moving and opposition papers,”
except that to which objections were made and properly
sustained. (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317,
21
334; Brown v. Goldstein (2019) 34 Cal.App.5th 418, 432.) “We
need not defer to the trial court and are not bound by the reasons
in its summary judgment ruling; we review the ruling of the
trial court, not its rationale.” (Oakland Raiders v. National
Football League (2005) 131 Cal.App.4th 621, 630.)
Here, the trial court framed the limited issue subject
to summary adjudication (the only issue excluded from its order
staying the action): whether the assignments of the five fuel
contracts to MCW were valid or invalid. MCW moved for
summary judgment or, alternatively, summary adjudication
on the ground Westco could not demonstrate the assignments
were invalid/void. Accordingly, as the moving party, MCW
had the initial burden to show Westco could not demonstrate
the assignments’ invalidity or present evidence of a triable issue
of fact as to their invalidity. MCW met its initial burden by
introducing evidence that Westco assigned the fuel contracts to
MCW, primarily through: the signed 2012 Master Agreement
and amendment, the signed 2013 Master Agreement and five
concurrently-signed assignments, the signed 2013 Authorization
Agreement, and the signed documents transferring the gas
stations subject to the assigned fuel contracts from Westco’s
master reseller agreement with Phillips to MCW’s master
reseller agreement with Phillips. MCW also presented evidence
of the consideration it gave Westco for the five assigned fuel
contracts, as we discuss in detail below.16
16 MCW submitted two declarations from Essop Mia, an
accountant and partner at the professional accounting firm that
acted as the independent third-party auditor for MCW’s publicly-
traded parent company. The firm’s audit of the company’s
consolidated financial statements included an audit of MCW’s
accounts, records, and transactions for fiscal years 2012, 2013,
22
The burden then shifted to Westco to raise a triable issue
of material fact from which the fact finder could conclude the
assignments were void ab initio (in other words, never delivered).
We conclude Westco failed to meet its burden.
3. The trial court properly found the 2013 Master
Agreement and five assignments were not canceled
In determining the assignments of the five fuel contracts
from Westco to MCW were valid, the trial court found they had
not been canceled as Westco contended because no writing signed
by the parties existed, as required by the unambiguous terms
of the contract. We agree.
a. Contract interpretation and the parol evidence rule
Generally, interpretation of a contract is a judicial function.
(Wolf v. Walt Disney Pictures & Television (2008) 162 Cal.App.4th
1107, 1125 (Wolf).) In interpreting a contract, the court “give[s]
effect to the mutual intention of the parties as it existed at
the time of contracting.” (Civ. Code, § 1636.) “Ordinarily, the
objective intent of the contracting parties is a legal question
determined solely by reference to the contract’s terms.” (Wolf,
at p. 1126; Civ. Code, § 1639 [“[w]hen a contract is reduced
to writing, the intention of the parties is to be ascertained from
the writing alone, if possible”]; id., § 1638 [the “language of a
contract is to govern its interpretation, if the language is clear
and explicit, and does not involve an absurdity”].) “The whole
of a contract is to be taken together, so as to give effect to every
part, if reasonably practicable, each clause helping to interpret
and 2014. Mia declared he “obtained, reviewed, and audited
the supporting and backup documentation for the transaction
between MCW and [Westco] at or about the time that [he]
was conducting the audits, in 2012, 2013, and 2014.”
23
the other.” (Civ. Code, § 1641.) And, “[s]everal contracts relating
to the same matters, between the same parties, and made as
parts of substantially one transaction, are to be taken together.”
(Id., § 1642; Versaci v Superior Court (2005) 127 Cal.App.4th 805,
814 (Versaci) [section 1642 also applies “ ‘to agreements executed
by the parties at different times if the later document is in fact
a part of the same transaction’ ”].)
“The court generally may not consider extrinsic evidence
of any prior agreement or contemporaneous oral agreement to
vary or contradict the clear and unambiguous terms of a written,
integrated contract.” (Wolf, supra, 162 Cal.App.4th at p. 1126;
Code Civ. Proc., § 1856, subd. (a).) The parol evidence rule
does not exclude extrinsic evidence introduced to interpret an
ambiguous term, to establish illegality or fraud, or where it is
relevant to the issue of an agreement’s validity. (Code Civ. Proc.,
§ 1856, subds. (f), (g).) Moreover, even if the terms of a contract
appear clear and unambiguous, extrinsic evidence is admissible
if relevant to prove the language is “reasonably susceptible”
to another meaning. (Pacific Gas & Elec. Co. v. G. W. Thomas
Drayage & R. Co. (1968) 69 Cal.2d 33, 37; Los Angeles City
Employees Union v. City of El Monte (1985) 177 Cal.App.3d 615,
622–623 [court may resort to extrinsic evidence to resolve a
latent ambiguity].)
b. The trial court did not prejudicially err when it
excluded Westco’s extrinsic evidence offered to
demonstrate MCW canceled the 2013 Master
Agreement
Westco contends the assignments were void because
MCW canceled the 2013 Master Agreement on June 25, 2013,
and the trial court erred in excluding Westco’s evidence of that
cancellation as barred by the parol evidence rule. We agree with
the trial court that the contract terms here are unambiguous
24
—the language is clear and explicit and does not involve any
absurdity. (Civ. Code, § 1638.) As we have said, the 2013
Master Agreement contained an unambiguous integration
clause and precluded the agreement’s modification, amendment,
termination, or the like, unless the parties agreed in a
signed writing. Each assignment contained a similar no-oral-
modification provision. Westco does not contend the contracts
at issue were not integrated agreements or argue the no-oral-
modification provision meant something different. The parol
evidence rule undisputedly applied, therefore, and Westco
could not introduce extrinsic evidence to contradict the terms
of the agreements unless an exception applied. (Code Civ. Proc.,
§ 1856, subd. (a).)
Westco did not seek to admit extrinsic evidence to show
the parties had a different intent at the time the contracts were
formed than the clear language implies, however. Rather, Westco
argues the evidence it submitted of events that occurred after the
parties signed the 2013 Master Agreement was admissible under
Code of Civil Procedure section 1856 to show the parties intended
to cancel their agreement in late June 2013, rendering the five
assignments void. That evidence consisted primarily of: a copy
of the signed 2013 Master Agreement with a handwritten note,
“Cancelled per Sam & Atone,” written across the front page;
MCW’s attorney Tiedt’s June 21, 2013 email exchange with
Bilal telling him that he was drafting a cancellation of the
contract “[s]ince money never changed hands and Westco did
not perform”; an excerpt from Tiedt’s deposition; the declaration
of MCW’s former COO Dabbas attesting he signed the 2013
Master Agreement and five assignments on behalf of MCW on
May 21, 2013, Westco and MCW entered into a cancellation of
that agreement on June 24, 2013, and he signed the cancellation
agreement on behalf of MCW; and, a copy of a “Cancellation
25
of Master Assignment Agreement” dated June 24, 2013, and
bearing Dabbas’s signature on behalf of MCW with a June 25,
2013 signature date.
The trial court found Westco’s evidence of the purported
cancellation of the 2013 Master Agreement did not raise
a question of fact as to the assignments’ invalidity because
the evidence did not constitute a writing signed by the parties.
On an alternative, separate ground, the court excluded Westco’s
“ ‘evidence’ of any purported cancellation of the assignments,”
as barred by the parol evidence rule. The only signed, written
agreement Westco presented was the cancellation agreement
Dabbas signed. Westco presented no evidence, however, that
Nino or another Westco representative signed that document
on behalf of Westco. Accordingly, under the terms of the 2013
Master Agreement and assignments, the cancellation was not
effective.
Nevertheless, a writing requirement such as the
one at issue here may be waived by evidence of the parties’
inconsistent conduct. (See Daugherty Co. v. Kimberly-Clark
Corp. (1971) 14 Cal.App.3d 151, 158 [“[a]n agreement to modify
a written contract will be implied if the conduct of the parties
is inconsistent with the written contract so as to warrant the
conclusion that the parties intended to modify it”].) In other
words, “ ‘the parties may, by their conduct, waive’ ” a no-oral-
modification requirement “where evidence shows that was
their intent.” (Biren v. Equality Emergency Medical Group, Inc.
(2002) 102 Cal.App.4th 125, 141 [amendment to written approval
requirement could be inferred based on past oral votes of
approval and oral amendment of writing requirement; plaintiff’s
behavior also showed an intent to treat the written approval
requirement “as if it never existed”]; Garrison v. Edward Brown
& Sons (1944) 25 Cal.2d 473, 479 [same].)
26
Westco argues Tiedt’s email and deposition testimony,
the handwritten cancellation note, the cancellation agreement
signed by Dabbas, and Dabbas’s declaration raise a triable
issue of material fact as to whether (or show as a matter of law)
the parties, through their conduct, intended to cancel the 2013
Master Agreement in late June 2013. But, that evidence does
not show the parties intended to waive the agreement’s writing
requirement. Indeed, the evidence that MCW’s attorney drafted
a written cancellation agreement belies any such conclusion.
The preparation of a written cancellation agreement with
signature blocks for all parties to sign can be interpreted only
as conduct consistent with the parties’ intent to adhere to the
writing requirement. Moreover, after the purported cancellation
of the 2013 Master Agreement in June 2013, the parties referred
to and incorporated the entirety of the 2012 and 2013 Master
Agreements in the recitals of their signed August 2013
Authorization Agreement—again demonstrating their intent
to abide by the various agreements’ writing requirements.
Westco argues the writing requirement did not apply.
It contends its signature was not required to cancel the 2013
Master Agreement because, under the agreement’s terms, MCW
had the unilateral right to cancel or terminate the agreement
if Phillips failed or refused to approve the assignments by July 3,
2013, or if the closing did not take place by that date. We do not
agree. As MCW notes, the purported cancellation agreement
was dated June 24, 2013, before MCW would have had any right
to terminate the agreement unilaterally. Westco appears to
contend MCW did not have to wait for the July 3, 2013 deadline
to pass because the parties had not performed. But, the contract
did not give MCW (or Westco) the right to cancel the agreement
for nonperformance before July 3. In any event, as we discussed,
the purported cancellation agreement called for Westco’s
27
signature. If MCW had a unilateral right to cancel the
agreement at that point, it would not have drawn up an
agreement calling for Westco’s signature.
Nor can we conclude the excluded extrinsic evidence about
canceling the 2013 Master Agreement raises a triable issue of
fact as to whether the parties mutually abandoned or rescinded
that agreement and the five assignments, as Westco seems to
contend. (See Honda v. Reed (1958) 156 Cal.App.2d 536, 539
[“ ‘mutual rescission or abrogation of a written contract may
be effected by an oral agreement’ ”]; Haberman v. Sawall (1925)
72 Cal.App. 576, 581 [parol evidence admissible to show parties
mutually abandoned written contract].) Had the parties done so,
they would have had no reason to incorporate the 2013 Master
Agreement—which would have been inoperative—“as though
fully set forth” in their August 2013 Authorization Agreement.17
At a minimum, they at least would have mentioned the
agreement’s cancellation when referring to having “entered into
[it] on June 1, 2013 for the assignment of” the five gas contracts.
No rational trier of fact could conclude the parties impliedly
abandoned or rescinded the 2013 Master Agreement and five
assignments when they not only incorporated the entirety of
that agreement into the 2013 Authorization Agreement, but also
made the effective date of the Authorization Agreement the same
as the 2013 Master Agreement—June 1, 2013. (Cf. Grunwald-
Marx, Inc. v. Los Angeles Joint Board, Amalgamated Clothing
Workers (1961) 192 Cal.App.2d 268, 279–280 [“ ‘ “It is well settled
that an abandonment of a contract may be implied from the acts
17 Nor would there be any reason for Westco to represent
and warrant “it was authorized and empowered to enter into
the Master Assignment Agreement dated June 1, 2013.”
28
of the parties and this may be accomplished by the repudiation
of the contract by one of the parties and by the acquiescence of
the other party in such repudiation.” ’ ”]; Schertzinger v. Williams
(1961) 198 Cal.App.2d 242, 246 [“circumstantial evidence of
abandonment or rescission of a contract is the rejection of
the existence of the contract by some word or act of one of the
contracting parties plus some word or act of the other contracting
party assenting to the abandonment or rescission of such
contract”].) In incorporating the 2013 Master Agreement,
MCW and Westco decidedly were not rejecting it.
Finally, we note Westco only challenges the trial court’s
exclusion of its cancellation evidence as barred by the parol
evidence rule. But the trial court also sustained Boyett’s and
MCW’s objections to the admission of the June 2013 email
exchange and to the handwritten note (by Boyett only)—on the
ground the evidence was inadmissible hearsay—and to Tiedt’s
deposition testimony discussing the matter—on the grounds
he lacked personal knowledge and the document was incomplete.
As Westco does not challenge those evidentiary rulings on appeal,
we consider that evidence “to have been properly excluded.”
(Lopez, supra, 98 Cal.App.4th at pp. 1014–1015.)
In any event, because no trier of fact could infer from
the evidence that the parties intended to waive the agreement’s
writing requirement to cancel the agreement—or that they
mutually abandoned or rescinded the agreement—Westco has
failed to demonstrate prejudicial error from the court’s exclusion
of the extrinsic evidence it contends shows the parties canceled
the 2013 Master Agreement in late June 2013, rendering the
assignments void.
29
4. The assignments were not automatically invalidated
if conditions in the 2013 Master Agreement failed
Having concluded Westco cannot demonstrate the parties
canceled the 2013 Master Agreement on June 25, 2013, we
consider Westco’s contention that the assignments were not
effective because the parties did not intend for them to be
delivered unless the conditions in the 2013 Master Agreement
were satisfied—Phillips’s consent by July 3, 2013, and MCW’s
payment of $550,000 to Westco upon Phillips’s consent.
We first address Westco’s contention that the court failed to
construe the 2013 Master Agreement and assignments together
and thus did not consider that the delivery of the assignments
was subject to these conditions. To the contrary, as the court
articulated at the hearing on the parties’ motions, it considered
the 2013 Master Agreement and five assignments, as well as
the rest of the parties’ agreements, as one transaction, as it
should have. (Civ. Code, § 1642; Versaci, supra, 127 Cal.App.4th
at p. 814.)
Moreover, although the trial court’s written ruling did
not explicitly address Westco’s contention that the conditions
in the 2013 Master Agreement failed, the court considered it
at the hearing when Westco specifically argued there was
a failure of the conditional delivery of the assignments when
Phillips did not approve them by July 3, as well as when MCW
did not pay Westco $550,000 on that date.
a. Phillips’s failure to consent to the assignments by
July 3, 2013, did not invalidate them
Westco contends Phillips’s approval of the assignments
by July 3, 2013 was a condition precedent to their delivery,
the failure of which rendered the assignments as if they never
had been made. We do not necessarily disagree that if Phillips
did not consent to the assignments they would not be effective.
30
We do disagree, however, that the parties intended for the
assignments automatically to be rendered void—as Westco seems
to argue—if Phillips did not consent to them by July 3, 2013.
We look first to the plain language of the contract. The
2013 Master Agreement provides for MCW initially to pay Westco
$200,000—of the total $750,000 consideration—in the form of a
credit on Westco’s debt. That obligation arose when the contract
was formed as of its June 1, 2013 effective date. MCW presented
evidence—discussed below—that it “made and extended” the
$200,000 credit to Westco on June 1, 2013. The agreement
then provides that MCW “will make a second payment of . . .
$550,000[ ] to Westco upon . . . Phillip[s’s] approval of this
Agreement and all Assignments.”
The next section—entitled, “Voidable Agreement”—is the
one on which Westco relies. The first sentence provides MCW is
not obligated to pay Westco unless the parties have signed all the
assignments (which they did). The second sentence states that
if Phillips fails or refuses to approve the agreement and
assignments by July 3, 2013, or rejects them, then the 2013
Master Agreement and assignments are “void,” and Westco
must return the first $200,000 payment (credit) to MCW. Westco
contends it presented evidence from which a trier of fact could
infer Phillips did not approve the assignments by July 3, 2013,
and the “nonoccurence” of that condition (and MCW’s concurrent
payment of $550,000) rendered the assignments void as a matter
of law.
Although parties are not bound by an agreement where
they understand approval of a third party is necessary for the
agreement to take effect, that “is true, . . . ‘only where it can
be said that reasonable persons would have understood that
the agreement would not be effective when originally signed.’ ”
(Frankel v. Board of Dental Examiners (1996) 46 Cal.App.4th
31
534, 549.) Thus, the “ ‘mere fact that . . . the actions agreed to
be performed under a contract are not due until a later date and
there is a present anticipation of a possible future repudiation
. . . is not a valid basis for concluding that the contract is not
presently binding and effective.’ ” (Id. at pp. 542, 549–550
[where stipulated settlement of disciplinary action against
dentist provided it was “ ‘of no force or effect’ ” if the board failed
to adopt the settlement, dentist could not withdraw his assent
to the settlement on ground stipulation was not effective before
the board had a chance to approve it].)
Here, the only reasonable interpretation of the agreement
is that it was effective before Phillips’s approval of the
assignments was received. MCW otherwise would have had
no obligation to make the first $200,000 payment to Westco.
That Phillips had not approved the assignments as of July 3,
2013, therefore, cannot be construed as nullifying the 2013
Master Agreement and concurrently-signed assignments. That
reading is consistent with the closing provision. Although the
closing of the transaction also was set for July 3, 2013, or another
date the parties agreed to in writing, MCW—but not Westco—
had the option to terminate the agreement—meaning the
agreement was effective before that date—if Westco delayed the
closing. The parties thus intended that they be able to perform
the agreement after July 3, 2013, if MCW consented to the delay.
Westco, however, would have us isolate the condition
of Phillips’s “timely” approval from the first sentence of the
“Voidable Agreement” provision and from the rest of the contract.
We must construe the contract terms together when ascertaining
intent. (Civ. Code, § 1641; Ogburn v. Travelers’ Ins. Co. (1929)
207 Cal. 50, 52–53 (Ogburn) [A contract is construed “as an
entirety, the intention being gathered from the whole instrument,
taking it by its four corners. Every part thereof should be given
32
some effect.”].) Reading the sentences in the provision together
along with MCW’s option—in the very next provision—to
terminate the agreement if its closing were delayed beyond that
same July 3, 2013 deadline, we conclude the parties intended to
make the agreement and assignments voidable at MCW’s election
if Phillips did not consent to them by July 3, 2013. (See Yvanova
v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 929–930
(Yvanova) [void contract is “without legal effect,” but a voidable
transaction “ ‘is one where one or more parties have the power,
by a manifestation of election to do so, to avoid the legal relations
created by the contract, or by ratification of the contract to
extinguish the power of avoidance’ ”].)
As the provision’s title states, the agreement and
assignments were voidable by MCW if the stated conditions—
the execution of all five assignments and Phillips’s approval
of them by July 3, 2013—did not occur. (See Ogburn, supra, 207
Cal. at pp. 52–53 [considering entire insurance policy including
introductory clause or caption to interpret intended coverage].)
Moreover, had the agreement and assignments voided upon the
mere passing of July 3, 2013, without Phillips’s approval, then
Westco would have had to return the $200,000 credit payment.
Westco presented no evidence, however, that the credit ever was
reversed, much less within five days of July 3, 2013.
In any event, the condition was written for MCW’s benefit.
The entire section is entitled “Purchase Price.” The “Voidable
Agreement” provision allowed MCW to avoid paying the purchase
price if Phillips did not approve of (or rejected) the assignments
by the July 3, 2013 closing date. That makes sense. Without
Phillips’s approval of the assignments, the fuel contracts would
be worthless to MCW: MCW would be unable to deliver Phillips’s
fuel to the affected gas stations unless Phillips agreed the
contracts could be assigned from Westco to MCW. Contract
33
provisions, including timeliness provisions, “are subject to
waiver by the party for whose benefit they are made.” (Galdjie
v. Darwish (2003) 113 Cal.App.4th 1331, 1339–1340 [seller
of real property waived timeliness provision “by continuing
to deal with” buyer after dates specified in contract passed].)
The parties’ conduct after July 3, 2013 supports the implied
finding that MCW did not elect to avoid the agreement, or it
(and, really Westco, too) waived the July 3, 2013 deadline. As we
discussed, had either party deemed the 2013 Master Agreement
and assignments void, neither would have executed the August
2013 Authorization Agreement, incorporating the master
agreements, after that date had passed.18 That conduct was
“so inconsistent” with either party’s intent to enforce any
purported right to require Phillips to have consented to the
assignments by July 3, 2013, that the “intention to give up that
right will be presumed.” (Oakland Raiders v. Oakland-Alameda
County Coliseum Inc. (2006) 144 Cal.App.4th 1175, 1194.)
Westco presented no evidence to support a contrary conclusion.
Finally, the evidence shows Phillips did in fact approve
the assignment of the five fuel contracts from Westco to MCW:
by email on July 19 and 23, 2013, Phillips’s personnel approved
the transfer of two of the gas station sites from Westco to MCW;
Phillips signed the ship to transfer forms, between August 12
and 23, transferring the five stations subject to the assigned fuel
contracts from its reseller agreement with Westco to its reseller
18 In essence, the 2013 Authorization Agreement was a
signed writing by the parties acknowledging their agreement
to postpone the closing of the transaction—as both the 2012 and
2013 Master Agreements permitted—based on their further
negotiations.
34
agreement with MCW; and Phillips entered into an amendment
to its master reseller agreement with MCW—effective August 23,
2013—adding the five stations subject to the assigned fuel
contracts.
Westco’s evidence does not raise a triable issue as to
Phillips’s actual consent to the assignments or support finding
the assignments were void when the July 3, 2013 “expiration
date” passed.
b. Westco did not meet its burden to demonstrate
the assignments failed for lack of consideration
Westco also contends the assignments were void as a
matter of law for a failure of consideration. Westco would have
us construe MCW’s failure to make a payment of $550,000 to
Westco upon Phillips’s approval of the assignments as a failed
condition rendering the 2013 Master Agreement void—rather
than voidable—and, thus, the concurrently-executed assignments
as if they had never been delivered. (See Yvanova, supra, 62
Cal.4th at pp. 929–930 [void contract “ ‘has no existence
whatever,’ ” while voidable contract “may be declared void but
is not void in itself”].)
We cannot. First, “[f]ailure of consideration does not
. . . vitiate the contract from the beginning; until rescinded
or terminated a contract once in effect remains in effect.”
(Taliaferro v. Davis (1963) 216 Cal.App.2d 398, 411.) This
is because a “failure of consideration is based, not upon facts
existing at the time the mutual promises bargained for in a
bilateral contract are made, but upon some fact or contingency
which occurs between the time of the making of the contract and
the action which results in the material failure of performance
by one party.” (Ibid.) Accordingly, the assignments were not
35
void or undelivered, as Westco asserts, simply by MCW’s failure
to pay Westco $550,000 directly.19 Second, nothing in the plain
language of the agreements suggests the parties intended MCW’s
delay in paying or failure to pay the $550,000 to nullify the
2013 Master Agreement and concurrently-executed assignments
from the beginning. And, although a failure of consideration
“authorizes a recission” (ibid.; Civ. Code, § 1689, subd. (b)(2)
[party may rescind a contract if consideration for its obligation
fails]), Westco affirmatively asserted it was “not seeking to
invalidate anything,” and, as we have discussed, it did not
demonstrate MCW canceled the agreement.
Nor can Westco demonstrate a total failure of consideration
or nonperformance in any event. First, the uncontradicted
evidence shows MCW at least partially performed in accordance
with the terms of the 2013 Master Agreement and assignments.
19 Westco argued that under Ivancovich v. Sullivan (1957)
149 Cal.App.2d 160, 164–165 the assignments could be only
absolute or void and, because the conditions to their delivery
were not met, were void. As Westco asserts, it agreed to assign
the fuel contracts “on the terms and conditions” identified in
the 2013 Master Agreement. We have concluded Westco failed
to rebut MCW’s evidence that the condition of Phillips’s approval
was satisfied. As to the “condition” that MCW pay Westco
$550,000, had Westco rescinded or declared the 2013 Master
Agreement void when MCW assumed Westco’s debt instead
of paying Westco directly, then we would agree an issue as to
the assignments’ validity would exist. But, as we discuss below,
because a trier of fact could conclude only that Westco intended
to transfer title of the fuel contracts to MCW—i.e., deliver the
assignments—after accepting MCW’s proffered consideration,
MCW’s alternative performance did not render the assignments
void.
36
Mia, the accountant-partner from the firm that audited MCW’s
accounts, declared that, on June 1, 2013, MCW extended the
$200,000 credit to Westco—as required by the 2013 Master
Agreement—to reduce the amount Westco owed MCW “in
connection with prior fuel purchases.” On July 13, 2013, MCW
also sent a wire transfer of $100,000 to the account Nino provided
it, designated “ ‘Corporate Account.’ ” Mia declared the payment
was made toward the “sum owed” to Westco for the purchase
of the five fuel contracts subject to the 2013 Master Agreement
and attached the wire confirmation.
And, under each assignment agreement, MCW agreed to
assume Westco’s obligation to pay Phillips any balance owed on
branding expenses paid for the benefit of the subject gas station.
MCW presented evidence—a Phillips ship-to transfer form—that,
on August 23, 2013, it did just that when it agreed to “assume
the responsibility and obligation for payment(s)” to Phillips for
$222,124.20 in unamortized program funds that Westco owed
Phillips. Westco’s liability for those payments simultaneously
was released.
Second, Westco presented no evidence to refute MCW’s
evidence that Westco received valuable consideration—
equivalent to, if not exceeding, the purchase price—in exchange
for assigning the fuel contracts to MCW. In addition to the
above, Mia declared MCW assumed debts of Westco “[a]s part of
the consideration that MCW paid to [Westco] for the assignment
to MCW of the five . . . [fuel] contracts.” According to Mia’s firm’s
review of supporting documentation sent to it in connection with
its audits, on July 1, 2013, MCW assumed a promissory note with
an outstanding balance of $126,042.63 that Westco had executed
in favor of Phillips; and, in August 2013—when Phillips approved
the transfers—MCW assumed eight loans totaling $841,171.24
that Westco owed to Phillips to pay for “branding” gas stations
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with which Westco had fuel contracts.20 (The trial court
overruled Westco’s objections to Mia’s supplemental declaration
and attached exhibits. Westco does not challenge those rulings.)
At the hearing, Westco argued there was no written
agreement or any other evidence showing Westco had agreed
to accept MCW’s assumption of its debt as consideration for the
five assignments, instead of the $550,000 direct payment. True,
there is no evidence of a writing signed by the parties providing
for MCW to pay the $550,000 by assuming Westco’s debt. But
the lack of a signed agreement to that effect does not render the
assignments void, as Westco contends, or raise a triable issue as
to whether they were void. Nor does the possibility that Westco
did not receive the full benefit of its bargain when MCW assumed
Westco’s debt instead of giving Westco $550,000, raise a triable
issue of fact as to the assignments’ validity.
As we discussed, any failure on MCW’s part to provide
the required consideration at best might render its agreement
to assign the fuel contracts voidable by Westco—a remedy Westco
has asserted it does not seek.21 Moreover, the only conclusion
20 Mia’s declaration attached a copy of Westco’s promissory
note to Phillips, sent to his firm around the time of the
transaction, and a summary of the debt MCW assumed, prepared
under Mia’s “guidance and supervision” in connection with his
firm’s audit of MCW’s parent company’s consolidated financial
statements.
21 And, there is no evidence that Westco could return the
consideration MCW paid for the assignments. As the trial court
said when responding to Bilal’s argument that MCW did not
perform, “you don’t have the money to pay [MCW] back when
you want to undo this deal. [¶] . . . [¶] They can’t do anything
and reverse anything. Westco . . . is not in business anymore.
38
that can be drawn from the evidence presented is that
Westco accepted MCW’s consideration. Having accepted that
performance, Westco cannot now claim the deal should be undone
because the consideration it received was in a different form
than the parties contemplated originally. (See North American
Dredging Co. v. Outer Harbor D. & W. Co. (1918) 178 Cal. 406,
415 [plaintiff could not accept defendant’s partial performance
without “waiving its right to rescind the contract upon the ground
of the defendant’s failure to fully perform it”; to permit otherwise
“would be to allow the party to receive a portion at least of the
benefits accruing to him under the contract with one hand while
preparing to destroy it with the other”].) Accordingly, even
if a finder of fact were able to conclude MCW’s performance
was defective, Westco is precluded from declaring the 2013
Master Agreement void and assignments invalid.
5. The evidence does not raise a triable issue of fact
demonstrating the parties did not intend to transfer
title of the fuel contracts
Finally, Westco contends triable issues of fact exist as to
whether the parties intended title of the fuel contracts to transfer
to MCW, despite having executed the assignments. We already
have rejected Westco’s contention the assignments never were
effectively delivered because MCW canceled the agreement
and conditions required for their delivery did not occur.
Westco also appears to contend a trier of fact could infer
from the evidence that, when the parties in August 2013
transferred Westco’s rights and obligations to MCW to deliver
fuel to the five gas stations, they did not intend for title to
They’re basically a defunct company. So there’s nothing they
can do to perform under any of these contracts.”
39
the fuel contracts to transfer to MCW. Westco primarily relies
on (or relied on in the trial court): MCW’s allegation in its FAC
that when Phillips cut off Westco’s fuel supply in August 2013,
“Nino asked MCW to take over fuel deliveries on a temporary
basis”; the August 21 and 22, 2013 email exchange about MCW
not purchasing the fuel contracts, but temporarily servicing
the five gas stations so they could receive fuel deliveries; Tiedt’s
deposition testimony about that exchange; Thomas’s deposition
testimony in case number BC522207 that the five sites were
temporarily transferred to MCW; Westco’s attorney Scapa’s
December 2013 letter to Phillips that Westco was trying
to sell the five gas stations and master reseller agreement;
and Bilal’s declaration that he continued to negotiate with
Tiedt and MCW in 2014 to purchase the fuel contracts.
As an initial matter, we presume the trial court properly
excluded—based on the evidentiary objections it sustained—
the August 21 and August 22, 2013 email exchange, Tiedt’s
deposition testimony, and Thomas’s deposition testimony.
Although Westco argued—and appears to argue on appeal—
the e-mail exchange and testimony could not be excluded under
the parol evidence rule, Westco does not challenge the court’s
evidentiary rulings sustaining MCW’s objections on appeal.22
Accepting as true MCW’s allegation that Nino asked it
to temporarily service the five stations—and even if we were
to consider the August 2013 email exchange and the Tiedt and
Thomas deposition testimony—we cannot conclude a reasonable
trier of fact could infer the parties did not intend for the executed
22 MCW objected to the exhibits containing the Tiedt and
Thomas depositions as “[i]ncomplete document[s].” We discussed
MCW’s objections to the e-mail exchange above.
40
assignments to take effect when Westco transferred the fuel
contracts to MCW in August 2013.
First, any agreement by the parties to have MCW
temporarily supply fuel to the affected gas stations would
not render the assignments void. Westco agreed to sell the
five fuel contracts to MCW. There is no evidence that Westco
and MCW entered a written agreement to terminate or cancel
the sale of those fuel contracts—and, therefore, nullify the
executed assignments—before or after they purportedly agreed
MCW would temporarily service the stations at a moment when
Westco’s fuel supply had been shut off. (Moreover, a decision by
the parties to delay further the closing for the contracts’ purchase
would be part of the further negotiations they agreed to in the
2013 Authorization Agreement. The 2013 Master Agreement
essentially was a continuation of the 2012 transaction after the
closing for the purchase of the last five contracts was postponed.
As the trial court aptly put it, the parties then agreed in August
2013 to negotiate further the implementation of that sale after
Bilal’s conduct with respect to his assertion of his shareholder
rights “caused additional negotiations to take place.”)
Second, the only conclusion to be drawn from the
uncontroverted evidence is that the parties went ahead and
performed their agreement to transfer title of the assigned fuel
contracts: Westco and MCW asked Phillips to consent to the
assignment of Westco’s rights (and obligations) under its reseller
agreement to deliver fuel to the five stations, which it did;23
23 Thomas declared Westco and MCW asked Phillips for its
consent in August 2013, and Phillips “consented to the transfers
and assignment of these rights.” Citing Thomas’s deposition,
Westco argues Phillips approved the transfers “only for purposes
of temporary servicing (not a transfer of ownership).” In his
41
Westco (through Nino) agreed to the transfer of the five stations
from its reseller agreement to MCW’s reseller agreement; and the
five affected stations were added to MCW’s reseller agreement.
The uncontroverted evidence also shows that when the five
stations were transferred to MCW’s reseller agreement, MCW
had the executed assignment agreements in hand, had applied
the $200,000 credit to amounts Westco owed it, had wired
$100,000 to Westco through Nino, and had agreed to assume
Westco’s obligations under its reseller agreement for the five
stations, releasing Westco from further liability. And, around
the time of the transfer, MCW had assumed over $840,000 of debt
Westco owed Phillips.
No reasonable fact finder could conclude MCW would
assume that much debt or Westco’s obligations owed to Phillips
unless title to the fuel contracts for the five sites had transferred
—as the parties agreed—when the sites were added to MCW’s
reseller agreement. Westco disputes that it received the
consideration due under the 2013 Master Agreement, but, as
we said, it presented no evidence to refute the Mia declaration
and exhibits evidencing Westco received consideration for the
deposition, Thomas testified he “facilitated the temporary
transfer” of the five fuel distribution contracts to MCW to keep
the stations in business. He had no expectation as to whether
the five contracts would be “transferred back” to Westco “at some
time in the future,” stating, “They could and they could not.”
Thomas assumed if Westco repaid its debt to Phillips and gave
it sufficient security, then the contracts “could get transferred
back.” That debt exceeded $1 million. As we said, the trial court
sustained MCW’s evidentiary objection to Thomas’s deposition
testimony. In any event, it does not raise a triable issue of fact as
to whether the parties intended the assignments to be effective.
42
purchase of the five fuel contracts. Nor did Westco introduce
any evidence that it rejected MCW’s assumption of its debt
as satisfying the balance due on the purchase price, or that
it reversed or tendered back the $200,000 credit or $100,000
wire transfer that MCW had made in June and July 2013.
Moreover, the documents effectuating the transfer of
the five stations from Westco’s to MCW’s reseller agreement
do not state the transfer is temporary or otherwise imply the fuel
contracts would be transferred back to Westco at a certain point.
Nor did (or could) Westco present evidence from which a trier
of fact could infer that was possible. Phillips had placed Westco
on a credit hold and shut off its fuel supply. Westco could not
deliver fuel from Phillips to any station unless it repaid the
$1 million it owed. That never happened. Nor is there any
evidence in the record that Westco could have repaid that debt.
Indeed, on December 17, 2013, Westco, through its former
attorney Scapa, “acknowledge[d]” it owed money to Phillips, but
admitted there were “insufficient funds . . . to liquidate any debt.”
Westco argues triable issues of material fact exist as to
the parties’ intent to transfer title of the fuel contracts based
on evidence that, after August 2013, Westco continued to attempt
to sell the fuel contracts, and MCW continued negotiations with
Westco to purchase them. Westco relies on the above letter from
Scapa that describes Westco’s plan to sell the subject five gas
stations and Westco’s master reseller agreement. We cannot
conclude that evidence presents a triable issue of material fact.
Westco’s attorney declared he sent that letter on the
same day his clients retained him. His statement in the letter
that Westco’s 2009 master reseller agreement with Phillips
“[c]urrently . . . covers” the five gas stations is plainly incorrect.
Those sites undisputedly were removed from that agreement
and transferred to MCW’s master reseller agreement, as we
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have discussed. Westco’s purported desire in December 2013
to sell its master reseller agreement along with the physical
sites does not raise a reasonable inference that the fuel contract
assignments were ineffective when Westco’s master reseller
agreement no longer included the five gas stations. Nor did
Westco present any evidence that the parties canceled or
reversed the August 2013 transfer of the sites to MCW’s reseller
agreement. Moreover, Westco’s sale of the physical gas station
sites does not demonstrate it retained title to the fuel contracts
to deliver fuel to those sites.
And, as the trial court found, in March 2014, Westco
admitted “five . . . contracts were transferred” from Westco
to MCW in August 2013. Because MCW had been “unwilling to
pay the agreed upon purchase price,” under the “Master Purchase
Agreement,” Westco was “exploring its remedies, including a
demand that [MCW] transfer back” the fuel contracts to Westco.
In other words, Westco admitted the assignments were delivered
and was seeking to rescind them.24 (Westco argues the letter
refers to the temporary transfer for MCW to supply fuel to
the gas stations, but if that were so, it would not have referred
to the purchase price or the parties’ agreement.)
Nor do Bilal’s purported negotiations with MCW in 2014
raise an inference that the assignments of the fuel contracts to
MCW were ineffective. Bilal declared that, from May 2014 until
November 2014, “MCW and John Tiedt were negotiating with me
to purchase [Westco’s] five [fuel] contracts. In fact, we had put
a deal together; however, MCW pulled out in about November
24 Bilal declared he was “shut out of [Westco] by Nino” from
August 2012 until Nino’s death on January 30, 2014. His letter
was “an inquiry and an effort to determine the status of
[Westco’s] assets and nothing more.”
44
2014.” Bilal’s declaration is not a writing signed by the parties
to cancel the assignments or undo the August 23, 2013 transfer
of the sites to MCW’s reseller agreement. Nor does he say Westco
and MCW agreed to reverse that transfer. His statements do
not raise a triable issue of material fact, therefore, as to whether
the assignments were void. Moreover, MCW commenced this
action—naming Westco and Bilal as defendants—on April 18,
2014. Accordingly, any negotiations between Tiedt and Bilal
about the transaction during the stated time frame would
have been conducted in the context of the pending litigation.
At the end of the day, Westco assigned the five fuel
contracts to MCW, the contracts were in fact transferred to
MCW, and Westco received valuable consideration from MCW
in exchange for the contracts. That evidence is uncontroverted.
And, any questions of fact surrounding the transaction are
immaterial to the issue of whether the assignments were void—
the only issue before the trial court. Westco may feel it got
short-changed on the deal, but to the extent it does, its fight is
with Nino who, for purposes of this appeal, was authorized to
transfer the contracts to MCW in exchange for the consideration
MCW undisputedly gave.
Accordingly, the trial court did not err in granting
MCW’s motion for summary adjudication and ordering the
five assignments were valid.
DISPOSITION
The December 10, 2019 order dismissing cross-defendant
Aleksandr Blyumkin from Westco Petroleum Distributors, Inc.’s
second amended cross-complaint based on the court having
granted MCW Fuels, LLC’s motion for summary adjudication
on October 4, 2019, entered on October 24, 2019, is affirmed.
Treating as a petition for writ of mandate Westco Petroleum
Distributors, Inc.’s appeal from that same order dismissing
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cross-defendants MCW Fuels, LLC, Stan Boyett & Son, Inc., and
Phillips 66 Company from its second amended cross-complaint,
the petition is denied.
Respondents MCW Fuels, LLC, Aleksandr Blyumkin,
and Stan Boyett & Son, Inc. are to recover their costs on appeal.
Phillips 66 Company did not participate in this appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
EGERTON, J.
We concur:
EDMON, P. J.
LIPNER, J.*
* Judge of the Los Angeles County Superior Court, assigned
by the Chief Justice pursuant to article VI, section 6 of the
California Constitution.
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