Restoration Management Co. v. Lee CA1/2

CourtCalifornia Court of Appeal
DecidedApril 1, 2025
DocketA168565
StatusUnpublished

This text of Restoration Management Co. v. Lee CA1/2 (Restoration Management Co. v. Lee CA1/2) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Restoration Management Co. v. Lee CA1/2, (Cal. Ct. App. 2025).

Opinion

Filed 4/1/25 Restoration Management Co. v. Lee CA1/2 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION TWO

RESTORATION MANAGEMENT COMPANY, Plaintiff and Respondent, A168565, A168650 v. (San Francisco County JAMES LEE, as Trustee, etc., et al., Super Ct. No. CGC-17-563187) Defendants and Appellants.

In these consolidated appeals, defendants James Lee, as trustee of the Paula Lee Residuary Trust UTD 11/28/1995 (the trust), and Michael Lee,1 the trust’s property manager, appeal from judgment in favor of plaintiff Restoration Management Company (Restoration) and orders denying the Lees’ motions for new trial and judgment notwithstanding the verdict. Considering the Lees’ arguments, we find no error and affirm. BACKGROUND On April 11, 2017, an electrical fire broke out in the basement of a commercial building owned by the trust and managed by Michael. The fire caused damage to Alfred’s Steakhouse (Alfred’s), a restaurant that leased the

1 For clarity, we refer to James and Michael individually by their first

names and together as the Lees. We intend no disrespect.

1 basement and ground floor of the building, as well as the Balmoral Hotel (Balmoral), a single room occupancy hotel situated above Alfred’s and owned by James.2 Restoration provides emergency-related damage control for residential and commercial structures impacted by fire or flood. On the night of the fire, Balmoral’s manager, Hazel Chen, signed an “Emergency Service Agreement” with Restoration, authorizing it “to proceed with its recommended procedures to preserve and protect the Property from further damage,” including a “smoke alarm survey, structure cleaning/Air Scrubbers.” Chen signed as an “Authorized Agent” of the Lees. The following day, April 12, Alfred’s entered into a similar emergency service agreement with Restoration for smoke and water damage to “the Property,” including “Water mitigation/Extraction/drying [the] Structure,” as well as an “electrical survey.” Alfred’s agreement was signed by Alfred’s general manager Lisa Robins, also denoted as “Authorized Agent,” and Jacob Arendt of Restoration. Both Balmoral’s agreement and Alfred’s agreement used the same fill- in-the-blank form with identical preprinted terms. As relevant, both agreements included a “Contract Price” clause, explaining services were being provided on “an emergency basis; therefore, it may be impossible to provide an accurate estimate” and the customer “agrees to pay [Restoration] for its work based upon [Restoration’s] standard and usual charges for similar emergency services.” The agreements also included an “Extra Work

2 Although a single building, the property was comprised of several

interconnected commercial units with individual access points and addresses. Alfred’s address was 659 Merchant Street in San Francisco, and Balmoral’s address was 668 Clay Street.

2 and Change Orders” provision, which detailed the requirements for change orders to “become part of the contract.” The San Francisco Department of Building Inspection “red tagged” the property and required an electrical survey of the building to determine the extent of the damage before Restoration’s work could begin. For Balmoral, Restoration’s work consisted of placing air scrubbers throughout the hotel to eliminate the smell of smoke. For Alfred’s, Restoration cleaned both the contents of the restaurant and the structure of the building. Over the course of the roughly 10-week project, Michael inspected the basement of the building four or five times and saw Restoration working on the property. On May 23, 2017, as Restoration was “wrapping up the structural cleaning in the basement of Alfred’s,” Arendt sent an e-mail to the Lees’ insurer’s third-party claims adjustor Dan Christensen, copying the Lees and requesting “authorization to move forward” with five tasks related to cleaning the building’s structure. On May 26, Michael responded: “Hi Jacob, [¶] If it fall[s] within the responsibility portion of the landlord, then please proceed with the remaining clean up from the fire damage.” Christensen also told Arendt to present the Lees with any documentation to pass along to their insurer, Lloyd’s of London. Restoration completed cleaning the property and its contents by July 2017. The invoice for “Odor Control” at Balmoral was $879, which the Lees paid. The sole and final invoice for Restoration’s work at Alfred’s included two charges: $72,424.16 for “Content Cleaning” and $299,086.16 for “Structure Cleaning,” neither of which were paid.3 After completing the

3 According to Restoration, common practice is for the landlord to pay

the cost for cleaning the building’s structure, while the tenant covers the costs of cleaning and damage to the contents. Alfred’s filed for bankruptcy in

3 remediation work, Robins asked Restoration to replace a door “on the Clay side” of the building, i.e., Balmoral’s side, which had been damaged in the fire. Restoration separately invoiced the Lees $5,135.74 for replacing the door; the Lees paid the door replacement invoice and were reimbursed by Lloyd’s of London. The Lees’ insurer otherwise denied coverage for Restoration’s work. On October 18, 2017, Restoration filed this action against the Lees for breach of “an oral contract (confirmed by a purchase order),” seeking $304,221.90 in damages. Restoration’s first amended complaint, which was the operative complaint at trial, alleged breach of a “written contract and work order.”4 On May 31, 2023, a jury was sworn, and trial began on June 8. On June 12, the third day of trial, Restoration moved to amend its complaint to conform to proof, which the court granted. The second amended complaint added a cause of action for “common count: services provided” and allegations regarding “quantum meruit” and “unjust enrichment.” On June 15, 2023, the jury returned verdicts for Restoration, finding the Lees’ liable for $304,221.90 on both the breach of contract and common count claims and awarding $5,125.74 in damages for “Restitution From Unjust Enrichment.” Because the parties had agreed to submit all claims to the jury and resolve any potential inconsistencies through an election of damages, Restoration requested entry of judgment on the breach of contract claim only. The court accordingly entered judgment of $229,221.90 in favor of

2021; Restoration did not attempt to recover the content cleaning portion of the invoice from the Lees. 4 Restoration’s initial and first amended complaints also asserted a

claim for mechanic’s lien foreclosure, which was withdrawn before trial.

4 Restoration, deeming it the prevailing party entitled to $12,697.34 in costs, and awarding $167,798.02 in prejudgment interest.5 The Lees moved for a new trial and for judgment notwithstanding the verdict, both of which the court denied. The Lees filed timely notices of appeal from the entry of judgment (A168565) and the orders denying their posttrial motions (A168650),6 which we consolidated. DISCUSSION The Lees challenge Restoration’s amendment to its complaint, the sufficiency of the evidence at trial, and the jury instructions and verdict. Our review begins from the fundamental principle that the trial court judgment is presumed to be correct, and the Lees bear the burden of demonstrating reversable error. (Jameson v. Desta (2018) 5 Cal.5th 594, 608–609.) I.

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