C.A. 2nd;
B276546

The Second Appellate District reversed a judgment. The court held that the trial court erred in concluding it could award damages to a non-prevailing party in order to “adjust the equities” between the parties.

Li Guan sued Yongmei Hu for breach of contract, fraud, and other claims based on Yu's alleged breach of a real estate agreement they had entered into. The trial court sustained Hu's demurrer to the contract claim with leave to amend, explaining that Guan needed to clarify the nature of the contract sued upon. Guan amended his complaint, but failed to cure the defect previously identified by the trial court. The court accordingly sustained Hu's demurrer without leave to amend. Guan did not challenge this ruling. Six months later, Guan proceeded to trial on his fraud-based claims of rescission, cancellation, and fraud in the inducement only.