Department 58

Hearing Date: February 6, 2023

Case Name: Alpine Group v. Gooding & Company, Inc., et al.

Case No.: 19STCV02637

Matter: Motion to bifurcate

Moving Party: Plaintiff/Cross-Defendant Alpine Group

Responding Party: Defendant/Cross-Complainant/Cross-Defendant Falcon Woods, LLC and Charles M. Seeger

Background

This is a case alleging breach of contract. Plaintiff Alpine Group (Alpine) alleges that Defendants Gooding & Company (Gooding), Falcon Woods, LLC (Falcon Woods), and Charles M. Seeger failed to provide access to a 1964 Ferrari purchased by Plaintiff at a post-auction sale (Post-Auction Sale Agreement). Plaintiff alleges causes of action for breach of contract, breach of the implied covenant of good faith and fair dealing, and inducement of breach of contract.

The auctioneer, Gooding, filed a Cross-Complaint against the owner of the Ferrari, Falcon Woods, for statutory indemnity, equitable indemnity, and contractual indemnity. It asserts that it entered into a “Consignment Agreement” with Falcon Woods that authorized it to sell the Ferrari for “5 million net.” After Gooding reportedly agreed to sell the Ferrari to Alpine, Falcon Woods then sought to unwind the deal.

In addition, Falcon Woods and Charles Seeger filed a Cross-Complaint against Gooding for breach of contract, breach of implied covenant of good faith and fair dealing, fraud in the inducement, negligence, breach of fiduciary duty, declaratory relief, and equitable indemnity. The basis of that lawsuit is the Consignment Agreement between Falcon Woods and Gooding. Falcon Woods alleged that it the Consignment Agreement authorized a sale at a minimum price of $6 million and it did not authorize Gooding to sell the Ferrari at $5 million.

Plaintiff Alpine moves for a bifurcation, seeking a bench trial on its two causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing. It argues that its requested remedy of specific performance of the Post-Auction Sale Agreement is equitable and the Court must adjudicate that issue.

Defendant Gooding does not oppose the motion to bifurcate, but requests that if the Court orders bifurcation, all equitable issues should be tried. Thus, Gooding also seeks a bench trial on its equitable defenses of consent, waiver, and estoppel. Alpine does not oppose this request.

Defendant Falcon Woods opposes any bifurcation, arguing that the “gist of the action” is the alleged breach of the Post-Auction Sale Agreement and the Consignment Agreement. Thus, it argues, the rights involved in this case are legal, despite the requested remedy of specific performance. It also argues that under Code of Civil Procedure section 592, Alpine seeks to recover possession of the Ferrari; therefore, the claim is legal because it is not seeking to establish ownership of the Vehicle, in contrast to, for example, quiet title. Alternatively, Falcon Woods argues that if the Court is inclined to separate out legal from equitable issues, it should allow the jury to decide legal issues of liability first before trying issues of equitable relief.

Plaintiff Alpine replied, arguing that it has always sought specific performance since the inception of this case and that equity issues should be tried first before legal issues.

Discussion

The Court does not fully understand the request of Alpine that the equity remedy be tried first. To the extent that it is requesting the Court determine liability under the breach of contract allegations, then it is unclear what would remain for a jury trial. Alpine concedes that any monetary damages is merely incidental. (Motion, p. 7:12-13.) Thus, there does not appear to be any remaining issue of fact or damages left for a jury to decide.

The Court’s view is that the breach of contract claims in Alpine’s Complaint and Falcon Woods’ Cross- Complaint are interrelated to one another. That is, whether Plaintiff is entitled to specific performance will depend on the validity of the Consignment Agreement, Gooding’s compliance with that Agreement, and whether Falcon Woods breached the Agreement. Plaintiff cites to Walton v. Walton (1995) 31 Cal.App.4th 277, 287 for the assertion that contract formation does not transform an action for specific performance into a legal action implicating the right to a jury trial. However, in this case, there are two other Cross-complaints, at least one of which requests damages.

At the hearing, the Court requests of Plaintiff a specific and detailed description of how each phase of the trial will transpire assuming bifurcation is ordered. Plaintiff will be asked to discuss at the hearing which causes of action will be tried after its breach of contract and breach of implied covenant of good faith claims are determined, and the types of evidence that would be presented in each phase. The Court will also entertain the perspectives of the other parties on the order of proof. The parties are ordered to provide a court reporter at the hearing.