California
Appeals

Standing-Party asserting a claim must have standing to do so.  In asserting a claim based upon a contract, this generally requires the party to be a signatory to the contract, or to be an intended third party beneficiary

DISCUSSION

I

          Where a defendant cross-claims against the plaintiff, dismissal of the cross-complaint is not a final judgment for purposes of appeal unless there is a separate and distinct party involved and adjudication of the cross-complaint represents a final adverse adjudication as to that party.  (See, e.g., Kantor v. Housing Authority (1992) 8 Cal.App.4th 424, 429; County of Los Angeles v. Guerrero (1989) 209 Cal.App.3d 1149, 1152, fn. 2; 9 Witkin, Cal. Procedure (4th ed. 1997) Appeal, § 73, p. 128.)  Because TEG is still involved in litigation with CAZA, we asked the parties to explain how it could be a proper party to this appeal.  We also asked them to address Sefton’s standing to assert any issues pertaining to the 2002 Daywork Drilling Contract and damage to the oil facilities.  The cross-complaint alleged that Sefton was a third-party beneficiary of the agreement, but the sole basis for that contention appeared to be its status as TEG’s parent.  No facts were alleged to show an intent by the parties to confer any benefit on Sefton, other than the indirect benefit derived from profits earned by its subsidiary TEG.  (See Berclain America Latina v. Baan Co. (1999) 74 Cal.App.4th 401, 405 [“It is elementary that a party asserting a claim must have standing to do so.  In asserting a claim based upon a contract, this generally requires the party to be a signatory to the contract, or to be an intended third party beneficiary”]; Luis v. Orcutt Town Water Co. (1962) 204 Cal.App.2d 433, 441-442 [holding that to assert a claim as a third-party beneficiary, “a plaintiff must plead a contract which was made expressly for his benefit and one in which it clearly appears that he was a beneficiary . . . .  The fortuitous fact that he may have suffered detriment by reason of the nonperformance of the contract does not give him a cause of action”]; National Rural Telecommunications v. DirecTV (C.D.Cal. 2004) 319 F.Supp.2d 1040, 1057 [“In general, a parent corporation and its subsidiary are legally distinct entities, and a contract under the corporate name of one is not treated as that of both”].) 
 

CAZA Drilling v. TEG Oil & Gas B182892 8/29/06 CA2/4

CAZA Drilling v. TEG Oil & Gas B182892 8/29/06 CA2/4-pdf