Pearce v. Allen

NANCY PEARCE, Plaintiff and Appellant, v. ALMA ALLEN, Defendant and Appellant.

B269744

COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION TWO

February 15, 2018

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Los Angeles County Super. Ct. No. BC551086)

APPEAL from a judgment and orders of the Superior Court of Los Angeles County. Gregory Keosian, Judge. Affirmed.

Law Offices of David A. Erikson, David A. Erikson and Antoinette Waller for Plaintiff and Appellant.

Liner LLP, Steven D. Liner, Wendy S. Dowse and Ellyn S. Garofalo; DLP Piper, Delilah Vinzon for Defendant and Appellant.

* * * * * * Back in 2001, a woman quit her corporate job so she could help her then-boyfriend with his fledging business as a sculptor. Over the next several years, they grew the business and had a child together. In 2013, the sculptor ended the romance; in 2014, he ended the business partnership. The woman sued for, among other things, (1) breach of contract based on the sculptor's promise to support her for life if she provided him her professional and household services, and (2) quantum meruit. The jury returned a special verdict finding that the parties had a contract that the sculptor had fulfilled and also awarding her $780,000 under quantum meruit for the same services that underlie the contract the jury found to exist and to be fulfilled. The trial court granted a new trial on the ground that the special verdict was inconsistent. Both parties appeal. We conclude the trial court's grant of a new trial was appropriate. We also address the woman's challenges to some of the court's evidentiary and legal rulings from the first trial that may be relevant during the retrial.

FACTS AND PROCEDURAL BACKGROUND

I. Facts

Nancy Pearce (Pearce) and Alma Allen (Allen) were high school sweethearts in the 1980's; in 2001, their paths again crossed, and they rekindled their romance.

Soon after resuming their romance, they moved in together, and Pearce quit her job at Universal Studios to help Allen start a business as a sculptor. For the first 18 months, they lived off of Allen's savings; by 2003, however, the business was profitable enough to cover their living expenses.

Pearce and Allen divided the tasks of running the business. Allen designed and built sculptures and furniture, and managedthe studio. Pearce handled most of the other aspects of the business, including overseeing the business's accounting, sales, billing, promotional materials (including a website), payroll, and legal paperwork. Pearce would spend anywhere from 30 to 50 hours a week on these tasks.

For the first few years, Allen had a studio in downtown Los Angeles (where he made the sculptures and furniture), and a storefront in Venice Beach (where Pearce sold them). Thereafter, they bought and built a home and studio in Joshua Tree.

In 2009, they had a daughter. Throughout their time together, Pearce managed the household tasks (such as grocery shopping, cleaning, and paying personal bills).

In 2013, Allen was invited to present three of his sculptures at a very prestigious art exhibition in New York City.

In July 2013, Allen broke off his romantic relationship with Pearce. In May 2014, he terminated their business partnership.

II. Procedural Background

A. Pearce's Complaint

In July 2014, Pearce sued Allen. Among other claims, she sued for: (1) breach of a contract, pursuant to Marvin v. Marvin (1976) 18 Cal.3d 660 (Marvin), claiming that Allen had promised to "provide for" Pearce's "monetary . . . support . . . for the rest of [her] li[fe]" if she "quit her job" and took "care of organizing and maintaining his affairs" (the "Marvin claim"); (2) the reasonable costs of the "services" she "performed . . . [that] benefit[ted]" Allen (the "quantum meruit claim"); (3) breach of a separate contract to be partners in the sculpture business and split its profits (the "breach of partnership agreement claim"); (4) breach of fiduciary duty, for wrongfully dissolving the partnership in 2014, not properly accounting for its assets upon dissolution, and"misappropriating the Partnership's opportunities"; (5) unjust enrichment; and (6) an accounting.¹

B. Pearce's Pretrial Position

In discovery and pretrial filings, Pearce clarified that the "consideration" underlying her Marvin claim was both the "domestic" "services" she provided (namely, "childcare and homemaking") and the "professional" "services" she provided (namely, "running the administrative and marketing aspects of the [sculpture] business"). Pearce explained that her quantum meruit claim sought compensation for "[m]aintaining the couple's home and business affairs." In light of this overlap, Pearce acknowledged that her quantum meruit claim was an "alternative" to her Marvin claim.

C. Trial

Because the parties stipulated that the breach of partnership agreement claim was subsumed in Pearce's separate accounting claim and that the court would conduct a bench trial on the accounting claim, the case proceeded to jury trial only on Pearce's (1) Marvin claim, (2) quantum meruit claim, (3) breach of fiduciary duty claim, and (4) unjust enrichment claim.

1. Joint statement of the case

During jury selection, the trial court read the prospective jurors an agreed-upon summary of the case. In pertinent part, that summary explained the basis for her Marvin claim—specifically, that Allen promised to "provide financial support" "inexchange for her quitting her job and . . . maintaining the couple's household and business affairs."

2. Opening statements

During her opening statement, Pearce argued that she and Allen were "life partners and . . . business partners" and explained the issue the jury was to decide—namely, "should [Pearce] be compensated for her 12 years that she labored to develop this business and develop [Allen's] name, and should she receive the benefits from that?"

3. Testimony

Pearce testified that she and Allen "had plans to be together and to be a team," that their "whole relationship has been business/personal," that her decision to "quit[] [her] job and . . . work[] with him and hav[e] a family" was based on his promise "to take care of [her] for the rest of [her] life," and was why Allen "is sitting in this great position right now." Pearce also called an accountant as an expert witness who calculated "a reasonable compensation for . . . Pearce's efforts at her duties within the partnership" based on the assumption that "Pearce would be supported for her life and a business partner." Specifically, the accountant calculated six different yearly salaries for Pearce's business services and then multiplied them by her remaining life expectancy (of 38 years), yielding amounts that (once discounted to present value) ranged from $1.1 million to $1.245 million. He also prepared a spreadsheet that set out the totals for each of the six yearly amounts for anywhere from 12 to 38 years.

Allen testified that the promise he made to Pearce was more modest—namely, that he would support her (using his savings) until the sculpture business could support them.

4. Nonsuit motion

Allen moved for a nonsuit on all of Pearce's claims. The trial court denied the motion as to the Marvin claim and the quantum meruit claim, but granted it as to the breach of fiduciary duty and unjust enrichment claims. The court reasoned that the breach of fiduciary duty claim was subsumed in Pearce's yet-to-be-tried accounting claim.

5. Jury instructions

The trial court instructed the jury on the remaining two claims. With respect to the Marvin claim, the court defined the pertinent contract as follows: "[Pearce] and [Allen] entered into an implied or oral agreement in which [Allen] would support [Pearce] for life in exchange for [Pearce] providing business and household services, including working in the couple's business partnership and maintaining the couple's business and household affairs." With respect to the quantum meruit claim, the court explained that Pearce "claims that [Allen] owes her money for services rendered." The court did not define those services, but did instruct the jury that they must be services for which Pearce "has not [been] paid."

6. Closing argument

In closing, Pearce asked the question, "What was the contract?" and then answered it: "Allen would take care of both of them monetarily" if Pearce "quit her job [and] . . . devote[d] her time, energy, and efforts to promoting . . . Allen's art career and taking care of [him] and the household." She asked the jury to award her "fair and reasonable" damages of somewhere between $629,182 to $1,245,449 for running the "business together and [ha]ving a household together."

7. Verdict

The parties submitted a special verdict form to the jury. As to the Marvin claim, the jury found that Pearce and Allen had a "contract for support," and that Allen had fulfilled it. As to the quantum meruit claim, the jury found that Pearce was "owed money by . . . Allen for the reasonable value of her household and/or business services" and awarded her $780,000.

D. Posttrial Motions

Allen moved for judgment notwithstanding the verdict and for a new trial, in part because the special verdict was inconsistent.

The trial court granted the motion for a new trial. The court ruled that the special verdict was inconsistent because it ran afoul of the legal principle that a plaintiff may not recover on a quantum meruit claim when there is a contract covering the same subject matter. After examining Pearce's complaint, the evidence at trial, the jury instructions, and the litigation heretofore, the court ruled that Pearce's Marvin claim and her quantum meruit claim both sought to provide compensation for Pearce's...