California Appellate Lawyer Blog

The short answer is the attorney may represent the new client against his old client when the new case does not involve matters substantially related to the prior representations. A "substantial relationship" exists where " the attorney had a direct professional relationship with the former client in which the attorney provided legal advice and services on a legal issue closely related to the legal issue in the present representation. " (Jessen v. Hartford Casualty Ins. Co. (2003) 111 Cal.App.4th 698, 710, 711.) More specifically, the focus is on "the legal and factual similarities of the two representations." (Farris v. Fireman's Fund Ins. Co. (2004) 119 Cal.App.4th 671, 679.) In Farris, the attorney had worked as coverage counsel for Fireman's Fund for over 10 years handling coverage claims and assisting the client in shaping the company's practices and procedures. Six months after his last representation of that client, counsel filed a bad faith claim against it in representing Farris. The appellate court reversed the trial court's denial of Farris' disqualification motion, finding disqualification was required. (Id. at pp. 685, 688.)

Against this backdrop, the Court of Appeal, Second District, Division Four, reviewed the disqualification of attorney Shahian in the recent case of Khani v. Ford Motor Company (publication ordered 4/25/13) 2013 DJDAR 5399. The motion to disqualify Shahian from representing Khani in Khani's lemon law action against Ford came in an action filed about 4 years after Shahian's last representation of Ford. A partner in Shahian's former law firm declared that Ford was a client of the law firm, Shahian had worked on 150 cases of this client, and Shahian was privy to confidential communications with Ford and information with respect to defense, prelitigation strategies and tactics in the handling of lemon law cases brought against client Ford. The trial court granted the disqualification motion.

The appellate court in Khani reversed the disqualification order. The court cited the above Jessen and Farris opinions approvingly for their legal analysis; but the court saw differences in their facts from the Khani case. For example, the attorney in Farris had "shaped the company's practices and procedures in handling California coverage case." These practices and procedures in Farris were said to likely be at issue in the bad faith case the attorney was now bringing against his former client some six months after he had stopped working for it.

Continue reading "When may an attorney represent in a new action a party adverse to former client he represented in previous actions? " »

There is a popular notion that if a party has violated a statute, legal liability necessarily flows from that violation. Not always so. Spriesterbach v. Holland (filed 4/9/13) 2013 DJDAR 4567 discusses some of important nuances concerning this subject.

Plaintiff rode his bicycle on a sidewalk in the direction opposite the direction of vehicular traffic on the adjoining roadway. He approached a supermarket parking lot to his left where he saw defendant's automobile stopped at the threshold of the sidewalk and parking lot. A hedge and wall separated the sidewalk from the parking lot with an opening at the driveway. Defendant did not see the bicycle as she edged over the sidewalk/driveway and onto the roadway, resulting in a collision that injured plaintiff. Plaintiff sued and the case was tried to a jury. At trial, each side claimed that the other was in violation of the California Vehicle Code.

Vehicle Code section 21804, on which plaintiff proposed a negligence per se instruction be given to the jury, provides that one exiting property to enter or cross a highway shall yield the right-of-way to traffic close enough to constitute a hazard; however once that driver has yielded until it is reasonably safe, other drivers shall yield. The trial court refused to give plaintiff's proposed instruction.

Vehicle Code sections 21605 and 21650.1, on which an instruction was given by the court over plaintiff's objection concerning the question of plaintiff's contributory negligence, provide that bicycles may be ridden on sidewalks; when bicycles are ridden on a roadway or shoulder of a highway, the bicycle shall be operated in the same direction as vehicles are required to be driven.

Continue reading "When should a "negligence per se" jury instruction be given and what is the impact of the giving or not giving? " »

In Collins v. Navistar, Inc. (filed March 29, 2013) 2013 DJDAR 4169, a juvenile was throwing chunks of concrete from a freeway overpass onto the freeway, hitting a number of vehicles. One such vehicle was that of plaintiff's deceased spouse, William Collins; a two and a half pound chunk penetrated the windshield and hit William in the forehead, causing severe brain injuries and causing his Navistar truck to crash into a wall. Among those sued was Navistar for product liability on the theory the windshield was defective. Navistar contended it need not anticipate third party criminality when it designed its product. The trial court agreed to the extent that it instructed the jury that, based on a heightened standard of foreseeability, Navistar could be liable only if it foresaw or should have foreseen that a third party would act in this particular manner.

Based on such instruction, the jury reached a verdict on the preclusive issue of duty: the signed verdict form read that Navistar could not "have known or reasonably foreseen that a person would likely take advantage of the situation created by Navistar's conduct to commit" an act like the juvenile's rock throwing. Plaintiff appealed the judgment in favor of Navistar. The Court of Appeal, Third Appellate District reversed.

The appellate court found that language of the instructions and verdict forms given over the objection of plaintiff, even though taken from standard instructions, did not properly adapt from premises negligence law to products liability. As the California Supreme Court stated in Soule v. General Motors ( 1994) 8 Cal.4th 548, 560, in strict products liability cases, truck manufacturers must anticipate that their vehicles will be involved in traffic accidents generally. The foreseeability is of the risk of harm, not of the particular intervening act, even though the manufacturer could not have foreseen the extent of harm or manner in which it occurred. (Torres v. Xomox Corp. (1996) 49 Cal.App.4th 1, 18-19.)

Continue reading "Does a third party's criminal conduct of throwing concrete down onto a freeway relieve truck manufacturer's duty to design windshield to protect against such flying objects? " »

In McDaniel v. Asuncion (filed March 27, 2013) 2013 DJDAR 4038, the plaintiffs, wife and daughter of decedent who lost his life in an automobile accident, sued numerous defendants for wrongful death. Before trial, defendant Asuncion served a joint offer to the two plaintiffs to settle against this defendant alone in the amount of $100,000, which went unaccepted. (California Code of Civil Procedure section 998.) Plaintiffs proceeded to trial against Asuncion and another defendant. While plaintiffs were awarded $3.3 million against the other defendant, Asuncion prevailed with a defense verdict. The Kern County trial court awarded Asuncion his costs, which included $41,000 in expert witness fees. Plaintiffs appealed.

Plaintiffs argued on appeal that a single section 998 offer addressed to multiple plaintiffs is invalid on its face. The problem with this kind of offer, the argument goes, is that one plaintiff cannot control the decision of the other plaintiff; where the defendant is setting forth a lump sum offer for both (or all) of the plaintiffs, the case will only settle when there is joint acceptance. Because the policy purpose of section 998 is to penalize a party who rejects a reasonable offer to settle and thus encourage settlements, the policy is not served by punishing a party who is thwarted in agreeing to settle because of an unwilling co-party. The Court of Appeal, Fifth Appellate District, disagreed, finding there is little, if any, justification for invalidating a joint offer made in a wrongful death case, where a single joint cause of action is brought and any award is given to all heirs in a lump sum. Because it was clear in this case that this defendant received a more favorable judgment, his award of expert witness fees was affirmed.

The Court of Appeal, in finding a wrongful death action to be an exception to the typical unenforceability against a rejected joint offer of settlement, does note a split of authority. The Sixth District case of Gilman v. Beverly California Corp. (1991) 231 Cal.App.3d 121 determined that the joint 998 offer of four wrongful-death plaintiffs did not allow the defendant there the opportunity to evaluate the distinct loss of each plaintiff and reversed an award of expert costs as it was impossible to say which of the plaintiffs' shares of the gross judgment were in excess of that plaintiff's share of the joint offer. So Gilman appears to be contrary to McDaniel.

Continue reading "When is a rejected joint offer to settle enforceable to award expert witness fees (CCP sect. 998)? " »

The short answer appears to be anytime a plaintiff pleads and proves such a theft under California Penal Code section 496 (a) and (c). Under section 496 (c), receiving or buying property obtained by theft is not only a criminal offense, but is also civilly punishable by allowing a person injured by a violation of 496(a) to be awarded treble damages plus attorney fees and costs.

In Bell v. Feibush ( filed January 15, 2013) 2013 DJDAR 627, plaintiff received a default judgment against defendant based on her complaint that defendant had induced her under false pretenses to loan him $202,500. She was awarded the unpaid $202,500 for breach of contract and fraud, and $607,500 as treble damages under her cause of action pled under 496(a); the trial court later reduced the total principal amount of judgment to $607,500. The appellate opinion does not say anything about whether attorney fees were awarded additionally, but those are awardable under 496(c) along with treble damages.

Defendant appealed the default judgment claiming that the statute requires a criminal conviction to trigger its civil provisions, and it also "opens the door to any collecting creditor to claim that a breach of contract constitutes a fraud, and in turn constitutes a theft," making all such cases vulnerable to treble damages and attorney fees. To paraphrase, the justices of the Court of Appeal, Fourth Appellate District, Division Three, answer that their hands are tied concerning the potential consequences of interpreting section 496 (c) to allow these enhanced awards. This is what the Legislature said, and it is not up to the courts to determine policy.

First, the Legislature knows how to use the word "conviction" and instead used the word "violation." The court cites a cable theft case (Heritage Cablevision of Ca., Inc v. Pusateri (1995) 38 Cal.App.4th 517) supporting its interpretation of "violation," which is used in Penal Code section 593d to invoke civil liability for $5,000 plus treble damages plus attorney fees. The Heritage court pointed out the statutory objective of allowing a mere "violation" to trigger 496 (c): the deterrent effect of the criminal sanction is illusory because people presume cable theft is a low priority crime for law enforcement.

Continue reading "When does theft by false pretenses constitute violation of receiving stolen property statute causing civil award of treble damages and attorney fees? " »

Even in cases not involving an award of attorney fees, this question concerns significant financial consequences, in addition to awarded damages, to a non-prevailing party--not uncommonly to the tune of half a million dollars. Such was the case in Whatley-Miller v. Cooper (published opinion filed January 15, 2013, No. B237335).

Plaintiffs, the survivors of Thomas Miller, were awarded a medical malpractice verdict against defendant, a medical doctor, in the total sum of approximately 1.2 million dollars. The history of this litigation included the filing of the complaint on February 28, 2008; defendant's receipt of discovery responses, including verification of decedent's income and other financial impacts to the survivors, from plaintiffs on June 11, 2008; and plaintiffs' offer to compromise for $950,000 (each side to pay its own costs) made pursuant to Code of Civil Procedure section 998, dated June 20, 2008 (only nine days after defendant received plaintiffs' discovery response). The offer was acceptable for 30 days, after which it would be withdrawn; should plaintiffs receive a more favorable award than the offer, in addition to costs awardable under section 998, plaintiffs would be entitled to interest at the rate of 10% per annum calculated from the date of the offer (Code of Civil Procedure section 3291). Defendant neither responded nor requested more time to respond to this offer. A first trial in Los Angeles Superior Court resulted in a hung jury with respect to the claims against Dr. Cooper, followed by a plaintiffs' verdict against him.in the second trial.

After post-trial motions, the judgment was amended to reflect a principal award of $1,198,907. Plaintiffs' filed a memorandum of costs totaling $530,316, including $108,191 for expert fees and $411,100 as prejudgment interest from the date of the compromise offer. Defendant moved to strike and tax these items, in part arguing the 998 offer was extinguished after the first trial and the offer was neither made in good faith nor in compliance with procedural requirements. The trial court found the mistrial at the first trial did not affect the applicability of the offer of compromise, that the offer was reasonable and discovery produced prior to the offer gave defendant an adequate basis to respond, and the offer was not procedurally infirm. The Court of Appeal, Second Appellate District, Division Eight, affirmed.

Concerning whether the offer was reasonably made in good faith, the court observed, "depends upon the information available to the parties as of the date the offer was served." (See Westamerica Bank v. MBG Industries, Inc. (2007) 158 Cal.App.4th 109, 130.) Was the offer a reasonable prediction within the range of possible results after trial? If so, were reasons known by plaintiff to predict such a result known or reasonably should have been known to defendant?

Continue reading "What constitutes a reasonable offer to compromise under California CCP section 998? " »

The California Supreme Court in Sargon Enterprises, Inc. v. University of Southern California (filed November 26, 2012, S191550) starts its reasoning concerning a trial court's discretion in excluding expert testimony with the following advice of Federal Judge Friendly written 50 years ago: "[A court] must be exceeding careful not to set the threshold too high. Yet it is the jury system itself that requires the common law judge in his efforts to prevent the jury from being satisfied by matters of slight value, capable of being exaggerated by prejudice and hasty reasoning . . . to exclude matter which does not rise to a clearly sufficient degree of value; something more than a minimum probative value is required."

The case before the state high court involved plaintiff, a small dental implant company which sued defendant for breach of contract; the plaintiff succeeded at jury trial in proving that defendant had breached its promise to conduct and report on a five-year clinical study of plaintiff's patented and government-approved one-step dental implant. The critical question, presented in an earlier motion in limine, was damages. Plaintiff proffered the testimony of an accountant expert that plaintiff's lost profits over a five-year period ranged from $200 million to over $1 billion. At the initial trial, the court excluded this testimony, and based upon other evidence, the jury awarded $433,000. Plaintiff appealed and the Court of Appeal, Second District, court ruled the trial court improperly focused on forseeability.

On remand, defendant again moved to exclude the expert testimony. After an extensive evidentiary hearing, the trial court again granted the motion to exclude, finding no factual basis for the expert's assumption that, had defendant studied and reported on plaintiff's innovative product, plaintiff would have had the marketing success and profits in the range of the top six dental implant manufacturers worldwide, which each at minimum did approximately 50 times the business that plaintiff did. The Court of Appeal again reversed; this time the Supreme Court granted review.

Continue reading ""Lost profits" expert evidence concerning projected upstart dental implant manufacturer too speculative." »

Does a dismissal with prejudice after a case settles under California Code of Civil Procedure section 998 preclude an award of attorney fees because the case did not proceed to "judgment?" This is the principal question raised in the Court of Appeal, Fifth Appellate District, case of Wohlgemuth v. Caterpillar, Inc. (filed July 23, 2012, F061981). The short answer is no.

The plaintiffs purchased a new motor home, the engine of which was manufactured and warranted by defendant. After there had been numerous attempts by defendant to repair what plaintiffs claimed were engine defects, plaintiffs sued under the Song-Beverly Warranty Act (Civil Code section 1790 et seq.), which entitles a prevailing consumer to attorney fees and costs in addition to damages.

Shortly before trial, defendant made a "998" offer to compromise by paying plaintiff $50,000 in exchange for a dismissal with prejudice and standard release of all claims. Plaintiffs accepted the offer, which was silent on attorney fees and costs, dismissed the action and then moved to recover their attorney fees and costs under Civil Code section 1794, subdivision (d). Defendant opposed the motion. The trial court granted the motion awarding $117,625 in attorney fees and $7,737 in costs.

Case law is clear that where a CCP 998 offer is silent on costs and fees, the prevailing party is entitled to costs and, if authorized by statute or contract, attorney fees." (Engle v. Copenbarger & Copenbarger, LLP (2007) 157 Cal.App.4th 165, 168.) Defendant's primary argument both in the trial court and on appeal was plaintiffs could not recover attorney fees and costs because there was no judgment entered in plaintiff's favor. This argument cites the language of 1794(d): a buyer who prevails in any action under the Song-Beverly Act is entitled to recover attorney fees and costs "as part of the judgment."

Continue reading "Dismissal of CCP 998-settled case where agreement silent on plaintiff's statutory claim of attorney fees does not preclude award " »

In Moe v. Anderson (filed July 11, 2012) 2012 DJDAR 9523, the Court of Appeal, Third Appellate District, distinguishes between joinder of plaintiffs against an offending physician defendant sued for separate sexual batteries, and joinder in the same lawsuit of those plaintiffs against the physician's employer for the negligent hiring and supervision of that physician. In the former joinder was found improper, in the latter proper.

Plaintiffs Paula and Edelmira were treated by defendant Anderson for their separate workers' compensation injuries. In May 2009, Paula alleges that Anderson made sexual advances and touched her breasts and vagina, absent her consent. Between July and September 2009, Edelmira alleges that, without her consent, Anderson committed numerous forcible sexual acts against her including oral copulation, sexual intercourse, and sodomy. They jointly filed an action against Anderson and his employer, defendant Healthworks.

In the trial court, both defendants demurred arguing plaintiffs were improperly joined because each plaintiff alleged events that constituted different conduct and transactions. Plaintiffs responded that their claims arose out of the same series of transactions and that they shared a common interest including that each of their employers referred them to the same medical facility; additionally they both sued a common codefendant, Healthworks. The trial court sustained the demurrers without leave to amend; the ruling was without prejudice to plaintiffs' filing new and separate complaints. Plaintiffs appealed.

Continue reading "Plaintiffs alleging separate acts of sexual battery by physician are not properly joined in single action " »

"It's the bad economy" has become the all-too-frequent, yet mostly accurate, cry heard when a party is called upon to explain the decrease, or even total loss, in value of a disputed asset. In litigation over community assets in a marital dissolution, this explanation may not suffice, as is emphasized in the recent California Court of Appeal, Fourth Appellate District (Division 3) case of Marriage of Margulis (modification filed Sept. 9, 2011) 2011 DJDAR 13821.

The evidence at trial showed that Elaine Margulis, as the non-managing spouse, had no personal knowledge of the extent of the community property at the time of her separation from Alan Margulis. Evidently, Alan as the spouse who managed the community assets, had at one time prepared a list of assets and their approximate values (investment funds purportedly totaling $787,000). Elaine offered this document into evidence to show that substantial community assets under Allen's control had disappeared between separation and trial. While the trial court admitted this document into evidence, it gave this evidence little or no weight. The court thus found that Elaine had failed to carry her burden of proving the values of these investment account assets.

The Court of Appeal disagreed. It found that the evidence introduced by Elaine satisfied her initial burden of showing that Alan controlled community assets of a certain value. The statutory fiduciary duties of disclosure and accounting effectively shifted the burden to Alan to rebut the presumption charging him with the assets listed in this evidence which constituted prima facie evidence of the values stated. (See California Family Code section 721, subdivision (b).) This statute requires the managing spouse to furnish information to the other spouse concerning the disposition of community assets. The trial court here failed to require Alan to trace the missing money to proper expenditures to determine whether he had taken unfair advantaged of her.

While the trial court did find that Alan neglected to maintain proper records, it failed to consider whether Alan had breached additional fiduciary duties that would have allowed Elaine to recover damages under Family Code section 1101, subdivisions (g) and (h) for assets undisclosed or transferred in breach of fiduciary duty.

So it is not enough for a managing spouse to simply say I lost all of that money on bad investments or the investments were victims of the bad economy. The spouse must keep good records of changes in values and details of disposition or else be charged with their prima facie value.

An appellate court can assist counsel on a discretionary basis by construing appeals from non-appealable orders. It may treat the matter as a writ petition. (Munger v. Gates (1987) 193 Cal.App.3d 1248, 1254.) It may view them as appeals from existing orders. (Vibert v. E. I. DuPont de Nemours & Co. (1995) 32 Cal.App.4th 1525, 1538) It may supply a missing judgment. (Nowlon v. Koram Ins. Center, Inc. (1991) 1 Cal.App.4th 1437, 1440-1441.)

But beware. An appellate court's "saving power" is entirely discretionary and case law is replete with California appellate cases expressing weariness with errant counsel. Those cases include one I authored while serving on California's Court of Appeal, Fifth Appellate District, Jordan v. Malone (1992) 5 Cal.App.4th 18. In Jordan, plaintiff candidly admitted no formal judgment was entered, but the appellate court should nonetheless construe the trial court's tentative decision as a final judgment. Not a good tactic to admit laziness. And the California Supreme Court has weighed in that the "saving" of an appeal renders jurisdiction "questionable," which should make reliance on an appellate court's generosity to save your appeal one of last resort. (Connolly v. County of Orange (1992), 1 Cal.4th 1105, 1112.)

Assessing an appeal requires deciding whether a case has sufficient merit to warrant the cost of appeal, what issues in particular have reasonable chance of success, and how best to argue your case. For those of us who have been on the other side of the bench, one piece of advice is absolutely essential: if you are the attorney who tried the case and your client approves and can afford it, get some form of assistance early on from experienced appellate counsel. Even very experienced trial counsel can be too close to the trees to see the forest. A review of your pre-trial, post-trial or pre-appeal matter for specific appellate issues or problems may save you from costly (and avoidable) errors.

In my June 2 blog article I discussed some general rules concerning whether a judgment is appealable. Today, the focus is on these two specific types of orders that have some tricky applications.

The majority view is that discovery sanctions, regardless of amount, are not directly appealable, but are reviewable only on appeal after final judgment or on writ petition. (Ballard v. Taylor (1993) 20 Cal.App.4th 1736, 1739.) There is however a minority of cases that construe Code of Civil Procedure section 904.1 (a) (11) and (12), the general sanctions statute, to apply to all sanctions including matters of discovery and thus allow direct appeal for those sanction orders exceeding $5,000. ( See, for example, Green v. Amante (1992) 3 Cal.4th 684, 690.)

In addition to some conflict in the law, an exception to the rule that a discovery sanction is not immediately appealable also exists. If a party's former attorney or an attorney of a party no longer participating in the litigation incurred the sanction order the order is deemed final as to the attorney who is no longer participating, an analysis akin to the "final as to a party" exception. (Barton v. Ahmanson Developments, Inc. (1993) 17 Cal.App.4th 1358, 1561.) Thus, counsel who believe they or their client have been improperly sanctioned and plan to appeal a sanction order must be especially diligent in reviewing appeal deadlines as the litigation progresses.

Continue reading "More on the question of whether an order is appealable: discovery sanctions and defaults" »

California Code of Civil Procedure section 904.1 provides the basic rules of what constitutes an appealable order. In this blog article, I wish to discuss some of the subtleties in making that determination.

Often attorneys attempt to appeal a case that gets dismissed as taken from a nonappealable judgment because of violation of the "One Final Judgment Rule." As the appellate court stated in Kinoshita v. Horio (1986) 186 Cal.App. 3d 959, at 966-967: "[P]iecemeal disposition and multiple appeals tend to be oppressive and costly." The objective here in strictly enforcing this rule is to avoid a multiplicity of appeals, reduce uncertainty and trial court delays, not allow an early appeal to be obviated by a later trial court ruling, and enable a complete adjudication that would allow specific instructions for further proceedings if necessary on remand.

A problem in application, however, is that the line is not always clear as to whether there is an issue left for further consideration by the trial court. On the one hand it might be said that if all that is left is compliance with the decree in question, the decree is final. On the other hand, if any judicial action by the trial court is necessary to an ultimate determination of the rights of the parties, the decree is not final. In short, what is determinative is substance rather than labels.

Continue reading "How Does One Determine Whether a Court Order or Judgment Is Appealable?" »

In the heat of battle during trial, it is far too easy for counsel to lose track of which chambers and side-bar discussions with the trial judge are being recorded by the court reporter. Remember, any argument made to the trial court that does not become a part of the record -- that recorded by the court reporter-- does not exist in the eyes of the appellate court. So today, I take a break from commenting on new cases, to shift to offering suggestions on what trial attorneys must do to preserve potential issues for appeal.

For example, many judges hold unreported jury instruction conferences, either in chambers or in the courtroom. If there are instructions that you object to or instructions offered by you that are rejected by the court, make sure that those arguments find their way into the appellate record should you need to seek appellate review of the rulings. This can be done by simply asking (and then reminding, if necessary) the trial court to summarize the unreported discussions at a convenient time in the court reporter's presence.

If you forget to do this, all may not be lost, but the alternative is riskier. The alternate way to get those arguments into the record is by way of what is called a "settled statement" on appeal--riskier because everyone may not remember the proceedings the same. (See California Rules of Court, Rule 8.37.)

Continue reading "Appellate Advice to the Trial Attorney: Make a Record" »

While this blog's primary focus is to comment on recent appellate opinions, trial attorneys may want to read it not just to keep current on some new cases, but also to help in trial strategy. You may ask: how does an appellate perspective help during trial? Quite simply, a hard earned victory at trial will be all for naught if it is reversed on appeal. I hope to write more specifically on this in future blogs.

For the trial attorney who has completed a trial with less-than-satisfactory results, assessing an appeal requires deciding whether a case has sufficient merit to warrant the cost of appeal, what issues in particular have reasonable chance of success, and how best to argue your case. For those of us who have been on the other side of the bench, one piece of advice is absolutely essential: if you are the attorney who tried the case and your client approves and can afford it, get some form of assistance early on from experienced appellate counsel. Even very experienced trial counsel can be too close to the trees to see the forest.

Continue reading "Winning at Trial and On Appeal: Professor Myron Moskovitz Joins the Dowling Aaron Incorporated Team" »