4DCA Division 1 Oral Argument - 2026/04/14 - Apr 14, 2026

argument

4DCA Division 1 Oral Argument - 2026/04/14

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What does the court’s remote check‑in procedure cover at the beginning of the session?

Unknown 9:41
Good morning. This is Martha from the Kirk's office. I will be doing a quick check-in for those appearing remotely. If you can please unmute yourselves and turn on your videos.
Unknown 9:56
Please state your presence when I call your name. If you experience any technical difficulties during the oral argument session, immediately exit the video conference and use the phone number and access code that I emailed you this morning. I have attorney Maximilian Lee.
Maximilian Lee 10:14
Good morning, present.
Unknown 10:16
Attorney Jason Hsu. Good
Maximilian Lee 10:19
morning. Good morning.
Unknown 10:20
Okay, so I'm going to ask you to please keep your microphones and videos off until your case is called. Okay, so court will be with you shortly. Thank you.
Sheila O'Connor 10:29
Thank you.
Dan Sharp 10:57
Good morning.
Dan Sharp 16:38
to come inside the courtroom. The appellate table is here to my right. And while the court's in session, please keep talking noise down to a minimum. Any questions for me this morning? Yes. Is there a protocol for appellant respondent versus which side, which page?
Unknown 20:12
Well, good morning. With me on this first panel are Justice Buchanan to my right and Justice Castillo to my left. We do have a panel change after the first case, but on all of the cases, keep in mind we're very familiar with your briefs. So just highlight those issues you think are most important. We're going to start this morning with AFL-AVL test systems versus Hensel Phelps. So once you approach the podium, please state your appearance and let us know if you wish to save time to respond.
Dan Sharp 20:45
Good morning, Your Honor. Dan Sharp, Colin Mooring for Appellant ABL Test Systems Inc. With me is David Ginsberg and Carrie Ferver of our firm. I would reserve three minutes for rebuttal.
Unknown 20:56
Two minutes? All right. You may proceed.
Dan Sharp 20:59
Good morning. I would like to address why the trial court committed legal error in its interpretation of Business and Professions Code Section 7045 which is an exemption from the contractor's license law such that the court should reverse the judgment and enter judgment in favor of my client, AVL, or at a minimum, remand the matter for trial on disputed facts.
Unknown 21:22
So if there are factual disputes, why would we, assuming we were to reverse the judgment, why would we grant summary judgment? Why should that be granted in your favor?
Dan Sharp 21:34
Because under Civil Code Section 1643, if it is possible for the court to adopt an interpretation of the contract that will make the contract lawful, operative, and capable of being carried into effect, the court is obligated by statute to adopt that interpretation. And therefore, if the contract is ambiguous, there's conflicting evidence that goes to the interpretation, the court, as a matter of law, should adopt the interpretation that makes the contract lawful. NOW, YOUR HONORS, MY CLIENT, AVL TEST SYSTEMS, HAS BEEN DOING BUSINESS IN THE STATE OF CALIFORNIA WITH THE STATE OF CALIFORNIA FOR YEARS AND YEARS, SUPPLYING AND INSTALLING EMISSIONS TESTING EQUIPMENT WITHOUT A CONTRACTOR'S LICENSE UNDER THE SECTION 7045 EXEMPTION.
Dan Sharp 22:22
ALL OF AVL'S COMPETITORS DO THE SAME THING. LET ME EXPLAIN HOW THAT WORKS. BUSINESS AND PROFESSIONS CODE, THE LICENSED LAW regulates builders, defined in Section 726 as people who construct, alter, repair, demolish structures, roadways, buildings. AVL makes emissions testing equipment. They're not a builder. The license law was not intended to regulate manufacturers of equipment. The 7045 exemption, in fact, explicitly states the license law does not apply to the sale or installation of any finished products that did not become a fixed part of the structure.
Steven Pisano 23:04
When respondent asked
Dan Sharp 23:06
AVL to get a license, why did AVL get a license? Why not just get an exemption? Because they were under contract, an $85 million contract with an important customer. The customer asked them to do this administrative thing. They saw no reason not to comply. It should not be no good deed goes unpunished. The reason that HP asked them to get a license is because HP didn't know what they were doing. They had not worked with emissions testing equipment before. They were not familiar with this area of the industry, and they were confused.

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