Jay v. Rock, C068400

CourtCalifornia Court of Appeals
Writing for the CourtMURRAY, J.
PartiesDANFORD A. JAY et al., Plaintiffs and Appellants, v. CHRISTOPHER J. ROCK et al., Defendants and Respondents. DANFORD A. JAY, Individually and as Trustees, etc., et al., Plaintiffs and Appellants, v. THE CITY OF CHICO et al., Defendants and Respondents.
Decision Date12 June 2019
Docket NumberC068400,C071967

DANFORD A. JAY et al., Plaintiffs and Appellants,
v.
CHRISTOPHER J. ROCK et al., Defendants and Respondents.


DANFORD A. JAY, Individually and as Trustees, etc., et al., Plaintiffs and Appellants,
v.
THE CITY OF CHICO et al., Defendants and Respondents.

C068400
C071967

COURT OF APPEAL OF THE STATE OF CALIFORNIA THIRD APPELLATE DISTRICT (Butte)

June 12, 2019


NOT TO BE PUBLISHED

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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Super. Ct. No. 145202)

(Super. Ct. No. 145203)

This opinion involves appeals in two cases, consolidated for argument and disposition. In both matters, we affirm the judgments.1

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The litigation involves a dispute arising out of the City of Chico's (the City) rejection of the plaintiff Danford Jay's application to operate as a fixed base operator (FBO) at the Chico Municipal Airport (the airport). Instead of addressing the deficiencies in the application and reapplying, plaintiffs Danford Jay and Sandra Jay (collectively, the Jays) filed these two actions.

In the first appeal, the Jays appeal from summary judgment in favor of defendants Christopher Rock, Maria Rock, and their business, Northgate Aviation, Inc. (collectively, the Rocks). The Jays alleged that the Rocks interfered with several contracts the Jays asserted they had with the City regarding FBO operations at the airport. In their motion for summary judgment, the Rocks contended that the Jays failed to raise a triable issue of fact that the City breached any contract with the Jays and that the Rocks induced the breach. The trial court agreed and granted summary judgment.

On appeal, the Jays contend that (1) the trial court erred in excluding a declaration by Douglas Guillon, the Jays' predecessor in interest, and (2) the trial court erred in granting summary judgment, because they presented evidence establishing triable issues of fact, which included the Guillon declaration.

The Rocks contend that Guillon's declaration was properly excluded and that the Jays failed to supply admissible evidence to support their argument that they were successors in interest to the several contracts at issue and even if they did make this showing, the contracts do not afford the Jays the contractual rights they claim. Thus, according to the Rocks, the City did not breach any contractual duties to the Jays. The Rocks further assert that even if the Jays had the contractual rights they claim, the City did not breach any rights under the contract, nor did the Rocks do anything to induce the breach.

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We conclude that the trial court did not err in granting summary judgment because Guillon's declaration was properly excluded and the remaining evidence is insufficient to support the Jays' theory of their contractual rights and the City's alleged breach of contract. We also conclude that the Jays failed to establish a triable issue of fact as to their claim that the Rocks induced a breach.

In the second appeal, the Jays appeal from an order sustaining the demurrer to their petition for writ of mandate, in favor of the City, City Council of Chico, Councilmembers Steve Bartagna, Mary Flynn, Scott Gruendl, Andy Holcombe, Tom Nickell, Ann Schwab, and City Manager David Burkland. In their petition, the Jays challenged the city council's (the Council) decision denying their application to become an FBO at the airport. They also challenge the City's decision to allow the Rocks to operate as an FBO and assert that the Rocks' contract is void. The City demurred, and the trial court sustained the demurrer without leave to amend.

On appeal, the Jays contend that the trial court erred because the petition properly alleged: (1) the Council lacked jurisdiction to review the airport commission's earlier decision granting the Jays' FBO application; (2) the Council's decision denying the Jays' FBO application is not supported by findings and substantial evidence; (3) the City's FBO contract with Northgate Aviation, Inc., is void; and (4) several claims that the Council's hearing and decision violated various fair hearing rights, including equal protection and due process, which were not raised during the Council hearing.2

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We conclude that the trial court did not err in sustaining the demurrer to the writ petition without leave to amend.

We affirm in both appeals.

FACTUAL AND PROCEDURAL BACKGROUND
The 1988 Contracts

Under the City's "Standards for Conducting Aeronautical Activities" at Chico Municipal Airport (the Standards),3 an FBO provides certain aeronautical services for the airport, including at least four of the following: aircraft charter (Air Taxi), aircraft fuel sales, aircraft tie-down, aircraft maintenance, and flight training. (Standards, § II(E)(1)-(5).) The Standards establish certain mandatory requirements for becoming an FBO and providing FBO services.

The Jays' claims in their litigation against the Rocks are based on a series of 1988 agreements involving Douglas and Deborah Guillon and their partners (collectively, the

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Guillons). Some of the claims made in the Jays' petition for writ of mandate also relate to these agreements.

On July 6, 1988, the Guillons entered into an agreement with the City to lease certain real property at the airport and construct a building on that property at their own expense (exh. V). The agreement provided that the Guillons would construct the building, lease the land on which it was built, and could lease the building to a third party with the consent of the City. Under the lease, upon termination of the lease, all improvements including the building would become the property of the City. Pursuant to this agreement, the Guillons or their sublessees could conduct certain aviation-related businesses on the leased property for a term of up to 50 years in renewable increments. Although exhibit V specifies that the Guillons may provide various non-FBO services on the leased property, in his deposition, Guillon stated that he designed the building on the property "specifically to perform the FBO function," and it "could only be used to perform the FBO function." While exhibit V provides for the construction of a building according to certain plans and specifications, it does not provide that the building must be used only for the FBO function or even that the primary purpose of the building would be to perform FBO functions. Exhibit V also provided Guillon with a "nonexclusive right" to use the "runways, taxiways, common use portions of the aprons."4 (Italics added.) However, the use of such facilities was "subject to the City's continuing right to direct and control such use."

On July 7, 1988, WestAir, Industries, Inc. (WestAir), entered into an agreement with the Guillons to lease the building the Guillons were to construct (exh. V-1). The Guillons limited the use to which WestAir could make of the premises to use as a FBO office.

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On July 6, 1988, the Guillons and the City executed a lease assumption agreement between them and the City. (Exh. V-3.) This agreement provides that the Guillons had the right to assume all the rights and duties of WestAir, the then existing FBO for the airport, in the event that WestAir defaulted and the City then decided to terminate the lease or if WestAir terminated its lease with the City, exhibit V-2. However, the Guillons' right to assume WestAir's rights is not triggered under V-3 if WestAir terminated its lease with the Guillons and not the lease with the City.

Additionally, on July 8, 1988, WestAir entered into a separate agreement with the City to lease a 3.52-acre ramp area adjacent to the Guillons' leasehold, a hangar, and additional property containing both aboveground and belowground fuel storage tanks "for the purpose of engaging in the business of a fixed base operator." (Exh. V-2.) WestAir was given the exclusive right to the 3.52-acre ramp area. The Guillons are not mentioned as a party in this agreement and Guillon did not sign it. Guillon admitted he is not a party to this agreement.

Guillon Sale to the Jays

On March 3, 2005, the Guillons sold the building they constructed on their leasehold to the Jays. On August 15, 2005, the City agreed to allow the Jays to assume the Guillons' rights under exhibit V to the leasehold in an agreement entitled, "Consent to Assignment and Assumption Lease of Real Property" (exh. W). However, the Jays did not acquire any interest in the adjacent 3.52-acre ramp area, the hangar, or the additional property containing fuel storage tanks leased to WestAir by the City. Exhibit W does not reference any assignment or assumption of rights under the several other contracts, exhibits V-1, V-2, or V-3. At the time of the sale, the leasehold in exhibit V was no longer being subletted to WestAir, but rather was being subletted to Redding Aero Enterprises, Inc., who was at that time operating as the sole FBO at the airport.

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Redding Aero Sale to the Rocks

On October 14, 2005, the Rocks purchased Redding Aero's physical assets in an asset purchase agreement. Following the asset purchase, the Rocks took over the FBO services that Redding Aero had been performing. Initially, the Rocks leased a portion of the Jays' building from them to provide FBO services.

On July 20, 2007, the Rocks entered an agreement with the City to lease the separate hangar space and the 3.52-ramp area to perform FBO functions for the airport (exh. X). This hangar space, like the Jays' building, was also adjacent to the 3.52-acre ramp area. Exhibit X required that the Rocks use the leased property "solely for the purpose of engaging in the business of a fixed base operator thereon." Exhibit X further provides that the right to perform FBO services is "nonexclusive," as required by the Airport and Airway...

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