Unreported / Non-Citable
Background
Richard Canales, trustee of a family trust that owned a Glendale warehouse, leased the property to Ideal Kitchen Supply, Inc. in July 2018. The lease negotiations consistently included a personal guaranty from all principals of the corporation, Norik Barseghian and his wife Rita Gharibians. The listing agents told Barseghian the landlord needed personal guarantees to make the deal work, and Barseghian provided personal tax returns and financial information for a credit check. The executed lease identified both appellants as guarantors and included a two-page guaranty addendum. Appellants initialed each page of the lease and the guaranty but did not sign the designated signature block on the guaranty's second page, an omission the listing agents did not notice.
Less than a year later, Canales brought an unlawful detainer action against Ideal Kitchen and won summary judgment on breach of the lease, though the court did not determine damages. Canales then sued appellants as guarantors. The case took a procedural detour when Judge Ralph C. Hofer issued a tentative ruling granting appellants' motion in limine to exclude evidence about execution of the guaranty, finding the guaranty unsigned. Canales voluntarily dismissed without prejudice, but this court granted a writ of mandate holding the dismissal improper after trial had commenced. On remand, appellants successfully challenged Judge Hofer peremptorily, and the case was reassigned to Judge Ashfaq G. Chowdhury, who denied a renewed motion in limine and conducted a two-day bench trial.
The Court’s Holding
The Court of Appeal affirmed the judgment against appellants. Reviewing the lease interpretation de novo, the court held the most reasonable reading was that appellants signed as guarantors. The absence of signatures on the guaranty's second page was not dispositive because the document had to be considered as a whole, and the lease clearly named appellants as guarantors on pages they initialed. The court rejected appellants' claim that they initialed only in their corporate capacities, citing the descriptio personae doctrine under which corporate titles added to a signature are merely descriptive and do not relieve an individual from personal liability on a contract containing a personal promise.
The court also held the lease and guaranty should be read together as one contract under Civil Code section 1642 because they related to the same matter, were made as parts of one transaction, expressly referenced each other, and were executed simultaneously. The court found substantial evidence supported the trial court's alternative finding that even if the lease were ambiguous, the trial evidence definitively established appellants as guarantors, and it deferred to the trial court's finding that Barseghian was not credible. Finally, the court rejected appellants' argument that Judge Hofer's tentative ruling on the prior motion in limine was binding, explaining that tentative rulings are not binding until reduced to a final written order and that in limine rulings are subject to reconsideration at trial.
Key Takeaways
- Initialing each page of a lease and guaranty can bind principals as personal guarantors even if they never sign the guaranty's signature block, when the documents are read as a whole.
- Corporate officers who sign a contract containing a personal promise cannot escape liability by pointing to their corporate titles, which courts treat as merely descriptive of the person.
- A lease and a guaranty executed at the same time and referencing each other are construed as a single contract under Civil Code section 1642.
- A judge's tentative ruling that is never adopted is not binding on a successor judge who takes over the case after a peremptory challenge.
- Failing to read a contract before signing it does not allow a party to avoid the contract's effects, and appellate courts defer to trial court credibility findings on such testimony.
Why It Matters
This unpublished decision reinforces well-settled California contract principles in the commercial leasing context: guaranties are construed together with the leases they secure, and principals cannot avoid personal liability through technical arguments about unsigned signature blocks when they initialed every page and the lease expressly names them. It also confirms that a tentative ruling by one judge, never adopted, creates no law of the case binding a successor judge after a peremptory challenge, a useful procedural clarification for practitioners in multi-judge superior court departments.