Tuesday, February 17, 2015

In Praise of Redlines . . .

Bertoli v. Sebastopol, No. A132916 (D1d4, as modified Jan. 30, 2015)

This is a modified opinion and nothing being modified is of procedural significance. What is significant is way the modification is drafted. The manner in which opinions are usually modified is somewhat less than transparent. Under the established practice, you can only figure out what’s going on—and whether its significant or just a minor fix—by reference to page, paragraph and sentence descriptions. In contrast, this order includes strikeouts that show exactly what text has been deleted and clear indications of what the court is adding. Helpful.

No, No Puede!

Velasquez v. Centrome, No. B247080 (D2d8 Jan. 30, 2015) 

This is a toxic tort case. Plaintiff claims that workplace exposure to diacetyl—a chemical that smells like butterscotch or cheap California chardonnay—caused him severe lung injuries. The main issue in dispute is whether plaintiff is entitled to recover damages for the cost of a future lung transplant. 

Monday, February 16, 2015

You Waived What‽

Anten v. Superior Court, No. B258437 (D2d1, as modified Feb. 10, 2015)

This is a short writ ruling on a privilege issue. It is largely based on common sense. But it has the potential to be significant when it comes to joint representations.

The question: Attorney represents Clients ## 1 and 2, who have a common interest in the same matter. After the representation ends, Client #1 sues attorney for malpractice, but Client #2 does not. In the malpractice lawsuit, can client #2 invoke the attorney-client privilege and preclude the discovery and evidentiary use of joint attorney-client communications?

The court says no. The situation falls within the literal wording of Evidence Code § 958, which says that “[t]here is no [attorney-client] privilege . . . as to a communication relevant to an issue of breach, by the lawyer or by the client, of a duty arising out of the lawyer-client relationship.” The fact that there’s a second co-client who alleges no breach does not bode otherwise, whether as a matter of statutory interpretation, or as a matter of policy. Otherwise, the non-disputing client could confound the attorney’s malpractice defense by invoking a privilege that was otherwise waived by the disputing client. That would not be fair.

Writ granted.

Everyone Prevails. Now Go Home.

Macquiddy v. Mercedes-Benz USA, LLC, No B251752 (D2d8 Jan 29, 2015) 

This is a Song-Beverly Warranty Act case about a lemon Mercedes. Mercedes refused to replace the car after numerous failed attempts to repair it. When plaintiff brought suit, however, Mercedes admitted liability in its answer and the parties stipulated as to what the appropriate restitution would be. Mercedes then made a Code of Civil Procedure § 998 offer for the full value of the restriction, plus costs and fees, but plaintiff decided to roll the dice to try to win a statutory penalty, which is available only when the defendant’s violation is proven willful. The jury found no willfulness and thus no penalty was awarded. Based on that verdict, the trial court found that plaintiff could not recover statutory attorneys’ fees because he was not a “prevailing party,” and that costs (not including fees) were awardable to Mercedes. Plaintiff appealed the fee and cost decisions, as well as a related discovery order.

On the discovery issue, the trial court denied a motion to compel and granted a protective order over a bunch of discovery propounded by plaintiff, on the grounds that it was essentially irrelevant because liability wasn’t contested. The court here ducks the question of whether the discovery may have proven relevant to the disputed question of willfulness. Instead, it holds that when a plaintiff challenges a discovery ruling on an appeal of final judgment (as opposed to taking a writ), Art. 6 § 13 of the California Constitution and § 475 require him to substantiate that he was prejudiced by the denial of discovery. Here, plaintiff failed to establish how, had the trial court permitted the discovery, there was a reasonable chance that it would have resulted in a different outcome, so the appeal fails on this issue.

On the attorneys’ fee issue, the Song-Beverly Act affords attorney’s fees to a prevailing plaintiff. See Civil Code § 1794(d). Prevailing party is not defined. Although § 1032, the costs statute—which permits awards of fees when awardable as costs—defines a prevailing party as someone who secures a net monetary recovery, § 1794(d) does not adopt that definition.  The court—citing authority to the effect that when prevailing party is undefined, an assessment should turn on pragmatic considerations—holds that plaintiff did not prevail in this case. Although he secured a net monetary recovery, he did so over only the part of the case that was essentially uncontested. Because the plaintiff did not obtain his main litigation objective—the penalty award—the trial court did not abuse its discretion in finding that he was not the prevailing party.

The Court holds, however, that the § 998 offer was invalid because it was too uncertain. Although the amount offered was clear, the offer was conditioned on the car being returned in an “undamaged condition, save normal wear and tear.” Because that condition was undefined and essentially subjective, the offer was insufficiently certain to be enforceable. And because the § 998 ruling is reversed, the trial court also erred in awarding Mercedes its costs under § 1032. With the § 998 offer invalid, costs are to be awarded to the prevailing party based on the normal statutory standard. As noted, that standard deems the party that receives a net monetary recovery to have prevailed. Here, that was plaintiff.

Reversed and remanded, in part.

Friday, February 13, 2015

Class Cert Giveth but SJ Taketh Away

Augustus v. ABM Sec. Svcs., No. B243788 (D2d1 Jan. 29, 2015)

The trial court certified a wage and hour class of security guards, on the premise that they were required to stay on call during their regular paid breaks. It also granted them summary judgment on the grounds that such a policy is facially illegal under Labor Code § 226.7 and the relevant wage order. The court of appeal renders a split decision on this issue. Because it was essentially uncontested that the on-call-while-on-break issue was a company-wide policy, it was appropriate, under the governing Brinker standard, to certify a class on the issue. So that’s affirmed. Problem for plaintiffs, however, is that, so long as any actually interrupted break time is compensated or made up for, an on-call-during-break policy isn’t necessarily illegal. So plaintiffs’ summary judgment on that ground gets reversed.

Affirmed in part and reversed in part. 

Update: Review granted, April 29, 2015.

Und Hier Kommt der Twist!

Maroney v. Iacobsohn, No. B249890 (D2d3, opinion after rehearing Jun. 4, 2015)

An auto accident plaintiff won a jury verdict but received far less in damages than she thought she deserved. So she moved for a new trial on damages. In ruling on the motion, the trial court said it would have granted the motion, but for the fact that the hearing occurred too late and thus that it lacked jurisdiction. So it “conditionally granted” the motion, subject to plaintiff’s appeal on the jurisdiction issue. The court of appeal rules that the trial court was wrong on the jurisdictional issue. But that doesn’t mean plaintiff gets her new trial.

Thursday, February 5, 2015

Club Bylaws Can't Work Retroactive Arbitration

Cobb v. Ironwood Country Club, No. G050446 (D4d3 Jan. 28, 2015)

Some folks are in a dispute with their country club. Four months into the litigation, the club revised its bylaws to say that any member-club disputes go to arbitration. No doubt you would be shocked to hear that that doesn’t work to require the members to arbitrate their already-pending case against the club. Even though bylaws are a contract between an association and its members, a contract can’t be unilaterally amended by one party with retroactive effect to the other party’s detriment without some kind of consideration. Prior cases address this point specifically in the arbitration context.


A McQueen Bullitt Dodged

Gray1 CPB LLC v. SCC Acquisitions, No. G04729A (D4d3 Jan. 27, 2015)

I wrote about this collections case when it was originally decided back in April of 2014. The Supreme Court subsequently granted review and held the case pending its decision in Conservatorship of McQueen, 59 Cal. 4th 602 (2014), which ultimately held that a motion to add attorneys’ fees to a judgment must be filed before the judgment is satisfied. This opinion is on a remand to reconsider in light of McQueen. But the crux of the original decision was that under the UCC rules that govern settlement of check payments, the judgment was actually satisfied when the creditor failed to refuse a cashier’s check as payment. So McQueen does not do any good for the creditor here, because, even under McQueen, the creditor moved for fees after satisfaction was accomplished.


A Substantial Nexus It Ain't

Greenwell v. Auto-Owners Ins. Co., No. C074546 (D3 Jan. 27, 2015)

It’s not too often that a defendant successfully gets a case dismissed for lack of personal jurisdiction in California. This is one of the few. It’s an insurance case where the insurer is out-of-state and the coverage involved property coverage for an apartment building in Arkansas, as well as general liability for a property management business, which was operated out of California. The claim dispute is over whether two fires at the Arkansas property count as a single or separate loss. 

Addressing specific jurisdiction only, the court holds that, while there was purposeful availment, the second element of the specific jurisdiction test—relatedness between the subject matter of the lawsuit and the in-state contacts—was not met. Which is rare because of the three versions of the relatedness test recognized in US jurisdictions, California has the loosest one. It requires only a “substantial nexus” that does not, per se, require any causal link between in-state contacts and the claim. Here, the claim—based as it was on the Arkansas fires—had little if any relationship to the insurers California contacts, much less a substantial one. The fact that the policy also covered hypothetical California losses didn’t change that.


Wednesday, February 4, 2015

We Limn in Limines

McMillin Cos.v. Am. Safety Indem. Co., No. D063586 (D4d1 Jan. 22, 2015)

The case is an insurance coverage dispute where, after denying the insurer’s summary judgment motion on policy interpretation, the court granted a couple of motions in limine that effectively ended the case, in that they ruled that the insurer couldn’t contest liability, but that the plaintiff's damages were entirely offset by prior settlement proceeds. The parties stipulated to judgment and both appealed.