Steven P. and Maureen Cade - Page 12




                                       - 12 -                                         
          would be limited to traditional contractual type remedies.  See             
          United States v. Burke, supra at 234 ("A 'tort' has been defined            
          broadly as a 'civil wrong, other than breach of contract, for               
          which the court will provide a remedy in the form of an action              
          for damages.'" (quoting Keeton et al., Prosser and Keeton on the            
          Law of Torts 2 (5th ed. 1984)); Mundy v. Household Fin. Corp.,              
          885 F.2d 542, 544 (9th Cir. 1989) (a breach of the implied                  
          covenant of good faith and fair dealing under California law is             
          not a tort).  To the extent that Harris’ payment of the                     
          $2,315,000 was intended to satisfy either the first or fifth                
          cause of action, it will not qualify for exclusion under section            
          104(a)(2).                                                                  
               As to the other three of the first five causes of action               
          (namely, interference with contract, interference with                      
          prospective advantage, and fraud), those claims did involve a               
          tort.  None of them alleges breach of contract, and each of them,           
          in and of itself, would, under California law, allow for the                
          recovery of damages for emotional distress.  Given that a                   
          recovery for emotional distress is not a traditional contractual            
          type remedy, we conclude that the second through fourth causes of           
          action satisfy the first condition for exclusion under section              
          104(a)(2).                                                                  
               We turn to analyze whether petitioner received any of the              
          $2,315,000 as compensation for those three torts so as to satisfy           
          the second condition for exclusion under section 104(a)(2) asking           




Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  Next

Last modified: May 25, 2011