In Satchmed Plaza Owners Association v. UWMC Hospital Corporation, (— Cal.Rptr.3d —, Cal.App. 4 Dist., Oct. 23, 2008), a California Court of Appeal considered a dispute between a property buyer and seller that led to the buyer’s appeal of a portion of a ruling stating that, while it had the right of first refusal to buy some of the properties, it did not have that right on other properties. The court found that because the buyer had already benefited from that ruling, by purchasing the properties the ruling permitted it to buy, it had waived its right to appeal the ruling. The court further determined that the portion of the ruling beneficial to the buyer, and the portion not beneficial to it, were not severable and the unfavorable portion could therefore not be separately appealed.
UWMC Hospital Corporation (“UWMC”) placed for sale 22 medical offices it owned, and also placed for sale its leasehold interests in 12 others. Satchmed Plaza Owners Association (“Satchmed”) claimed a right of first refusal to buy the offices. UWMC disputed that right and Satchmed sought an order that it be permitted to purchase the offices. The court ruled that Satchmed had right of first refusal to the 22 owned offices but not to the 12 leased offices. Satchmed proceeded to purchase the 22 owned offices and then appealed the portion of the ruling finding that it did not have a right of first refusal to the 12 leased offices.
The court cited Epstein v. DeDomenico (1990) 224 Cal.App.3d 1243, which stated, “It is the settled rule that the voluntary acceptance of the benefit of a judgment or order is a bar to the prosecution of an appeal therefrom.” Satchmed had benefited from the ruling when it proceeded to make the permitted purchases, the court said, and in so doing had waived its right to appeal it.
Further, the court rejected Satchmed’s claim that its purchase was not “voluntary,” but under compulsion, as it either had to make the purchase or risk losing the right to do so. There was no reason, the court said, why Satchmed could not have appealed the entire judgment prior to buying the properties and hoped that a favorable ruling would have continued to allow it to do so. Rather, the court said, Satchmed sought to reverse the unfavorable portion of the ruling without risking that the favorable portion might be overturned. “Having to make a choice of this nature does not make the chosen avenue involuntary,” the court stated.
Finally, the two portions of the ruling were not severable and could not be appealed separately, the court found. Whether a portion of a judgment is severable depends on whether it “is so interwoven with its other provisions as to preclude an independent examination of the part challenged,” the court said, citing Gonzalez v. R. J. Novick Construction Co. (1978) 20 Cal.3d 798. Here, the court said, it was impossible to evaluate Satchmed’s right to buy the owned offices without considering its right to the leased offices, and vice versa. Satchmed therefore could not seek a separate ruling on its right to buy the leased offices only.
Because Satchmed had already benefited from the ruling by making the purchases the ruling authorized, and because the portion of the ruling unfavorable to Satchmed was unseverable, Satchmed had waived its right to appeal the ruling. The appeal was dismissed.
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