ENA North Beach, Inc. v. 524 Union StreetAnnotate this Case
Hong, the president of ENA, sought to open a restaurant with a license to serve beer and wine in a building owned by 524 Union, which had housed restaurants for many years. After leasing the premises, ENA was unable to open because the San Francisco Planning Department determined that an existing conditional use authorization for the property was no longer effective and a new one could not be granted. ENA sued the lessors, claiming false representations and failure to disclose material facts regarding the problems with the conditional use authorization. A jury awarded ENA compensatory and punitive damages. The court of appeal held that the jury’s verdict on liability, including liability for punitive damages, is supported by substantial evidence. Hong’s testimony was substantial evidence supporting the jury’s verdict. Additional support was provided by evidence of email correspondence around the time Hong entered the lease. The trial court employed an improper procedural mechanism in reducing the amount of the punitive damages award but the jury award was unsupported and Hong effectively stipulated to the reduced amount.