Potrero Homes v. Western Orbis Co.

Respondent, Potrero Homes (hereinafter, Potrero), obtained a judgment of $29,515.53 plus interest and costs from appellant, Western Orbis Company (hereinafter, Western), in an action based upon a contract wherein appellant promised to- pay for a portion of Kimber Road to be constructed by respondent.

Both Western and Potrero are highly sophisticated and experienced building developers in Southern California. In 1966 Western owned a parcel of 550 acres encumbered with a deed of trust in favor of United California Bank securing a promissory note in the amount of $3,300,000. Potrero was the owner of a large parcel of real property adjoining Western’s property on the west and encompassed by “Tentative Tract Map No. 1928-1.”

The “Tentative Tract Map” as well as the master plan of the City of Thousand Oaks required the extension of a county highway known as Kimber Road through the entire width of Potrero’s property, ending at the west boundary of Western’s property. Although Western had another access to its property, the construction of Kimber Road to its property line would give it another good access.

Sometime in 1966 the parties entered into negotiations regarding the…