Counts

Counts v. Chadwick CA1/1

Good Law
Court of Appeal of CaliforniaNovember 15, 2022A163282California5,201 words

Opinion

Opinion

I.

FACTUAL AND PROCEDURAL

BACKGROUND2

Chadwick operated a small cannabis dispensary in Vallejo, Homegrown Holistic Collective, Inc. (H2C), which was organized as a nonprofit mutual benefit corporation. In November 2015, she and plaintiffs entered a contract entitled Agreement for Transfer of Control (Agreement). Under the Agreement, plaintiffs promised to pay Chadwick a $20,000 deposit, and she promised to transfer control of H2C to them by November 15, 2015. Specifically, she promised to (1) “take all actions necessary” to replace H2C’s board of directors with herself and plaintiffs and (2) amend H2C’s bylaws to ensure plaintiffs held the majority of seats on the board of directors with “full authority to manage and operate [H2C].” Plaintiffs timely paid the deposit, but Chadwick did not replace the board of directors or amend the bylaws. Under the Agreement, Chadwick also promised to “ensure that [H2C] submit[ted] to the City of Vallejo all required documentation, in accordance with the laws and ordinances of the City of Vallejo, to receive a Final Letter of Limited Immunity . . . from the City of Vallejo.” In turn, plaintiffs were required to pay $150,000 to Chadwick within…

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