Ben Feuer and Charles Kagay have obtained reversal in the California Court of Appeal’s Second District of a demurrer dismissing a breach of contract action brought by Seaker & Sons, a commercial property owner, against Cushman & Wakefield, its former property managers. Cushman & Wakefield was represented by Mayer Brown on appeal.
The lawsuit arose out of a dispute between Seaker & Sons and its previous tenant, App Annie. App Annie had made modifications to the offices it leased that did not meet local building codes, leading to significant remediation costs. The two arbitrated their disagreement, and Seaker & Sons was ultimately ordered to pay App Annie nearly $8 million.
Seaker & Sons then sued Cushman & Wakefield, alleging that its former manager breached its management contract by failing to properly oversee App Annie or notify Seaker & Sons that App Annie was making unpermitted improvements. This breach, Seaker & Sons alleged, led to the eventual award it was required to pay App Annie.
The trial court granted Cushman & Wakefield’s demurrer, concluding that Cushman & Wakefield was not required to oversee App Annie’s improvements and the arbitration award Seaker & Sons paid to App Annie was not caused by Cushman & Wakefield’s alleged breach.
The Court of Appeal reversed, however. It found that Seaker & Sons sufficiently alleged both Cushman & Wakefield’s responsibility to oversee App Annie and that it was a cause of the damages. While the Court of Appeal affirmed other grounds in the demurrer, the breach of contract claim reaches all of Seaker & Sons’s claimed damages and will now go forward.
You can read the opinion in Seaker & Sons v. Cushman & Wakefield of California, Inc. by clicking here.
