Appellant seller sought relief from a judgment of the Superior Court of Los Angeles County (California) in favor of respondent buyer, in an action for breach of contract of purchase of the physical assets, files, and work in progress of his law practice. Appellant alleged error in using extrinsic evidence to alter the written terms of the contract and then construing the altered contract as contrary to public policy and unenforceable.
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Overview
Appellant seller entered into a purchase agreement with respondent buyer to purchase the physical assets, files, and work process of his law practice. Respondent paid $ 15,000, attributable to the physical assets. When the expected business did not materialize, respondent refused to complete payment and appellant brought an action for breach of contract. On appeal from a judgment entered in favor of respondent, the court held that the provisions of the agreement, in view of the transaction contemplated thereby, supported the trial court’s action in utilizing parol and extrinsic evidence to determine the intent of the parties to sell future patronage of existing and former clients. The court concurred with the trial court’s interpretation of the contract that the attempt to sell the expectation of future patronage of former or existing clients was an attempt to sell the good will of a law practice as a going business, and such purported sale was illegal and unenforceable in view of Cal. Bus. & Prof. Code § 6076. As the obligation was contrary to public policy and unenforceable, the right to attorney’s fees created under the contract never matured.
Outcome
The judgment entered in favor of respondent buyer in appellant seller’s action for breach of contract was affirmed, as the contractual provision purporting to sell good will from appellant’s law practice was unenforceable as contrary to public policy. As the obligation was unenforceable, the right to attorney’s fees in favor of respondent was improper, and the judgment was modified to strike such fees.
