The Court of Appeal Time Machine – Interest Calculations on Modified Judgments

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Still from The Time Machine (1960)

If you obtained a judgment against your former client for over $7.7 million, and had the court of appeal knock it down to around $1.7 million, and the trial court entered judgment in that reduced amount 14 months after the date of the original judgment, you would want interest to run on the judgment — even from the reduced amount — from the date of the original judgment, right? Of course you would. After all, 14 months of interest at a simple 10% on the $1.7 million amount is nearly $200,000. That’s not pocket change. (Well, not for me, anyway.)

But in Chodos v. Borman, case no. B260326 (2d Dist. August 18, 2015), the trial court ordered that interest on the judgment was to run only from the date of entry of the later judgment entered after the original appeal. That’s $200,000 up in smoke. Chodos, the judgment creditor, appealed.

And wins. The Court of Appeal points out that whether interest runs from the date of the original judgment or the date of the later judgment depends on whether its disposition in the original appeal amounted to a reversal of the judgment (in which case interest would run from the later judgment only) or merely a modification of the judgment (in which case the interest would run from the date of the original judgment).

Well, that should be an easy question, right? After all, the court knows what it did in the last appeal. But let’s just say it was not obvious to everyone. The trial court got it wrong.

As in many areas of the law, one must look past the form of the Court of Appeal’s prior opinion and identify its substance. The court had phrased its disposition in the prior appeal as a reversal:

The judgment is reversed and the matter is remanded to the trial court with instructions to enter a new judgment based on that portion of the special verdict form that awarded the attorney a $1.8 million lodestar amount based on the jury’s finding of a reasonable hourly rate of $1,000 and a reasonable number of hours expended on the two divorce cases and the Marvin action of 1,800. As it did in the original judgment, the trial court shall make adjustments to the $1.8 million award by adding the amount of $24,921 and deducting the amount of $107,000.

Despite the use of the word “reversed,” however, the disposition was really a mere modification of the judgment. It directed the trial court to enter a judgment in favor of the original prevailing party in a reduced amount, rather than returning the case to theatrical court for any further hearings on the amount of the judgment.

Thus, appellant is able to “return” to the date of the original judgment via the Court of Appeal Time Machine, and watch the interest accrue from that date.

The standard of review on appeal regarding enforceability of arbitration clauses

questions-1As I’ve mentioned before, the standard of review is not always clear. One sometimes has to “drill down” past the obvious, and the “abuse of discretion” standard is full of nuance. The parties’ briefs may even fight over which is the correct standard of review to apply, or the cases may be split on the issue. Sometimes, where the standard is in dispute, it doesn’t matter, because the outcome is the same under either standard.

There is no question as to what standard of review applies in yesterday’s decision in Carlson v. Home Team Pest Defense, Inc., case no. A142219 (1st Dist., August 17, 2015), but the case nonetheless has a lesson in careful application of the standard of review. The appeal was from an order denying a motion to compel arbitration. The court begins its discussion of the standard of review by announcing “There is no uniform standard of review for evaluating an order denying a motion to compel arbitration.”

Well, if there is no uniform standard, how do you decide what standard applies to your case? It’s hard to answer that question any more succinctly than the court, so I’ll let the court do it:

If the court’s order is based on a decision of fact, then we adopt a substantial evidence standard. [Citations.] Alternatively, if the court’s denial rests solely on a decision of law, then a de novo standard of review is employed.

In this case the trial court made factual findings based on at least some material disputed evidence. From those findings, the trial court concluded that Home’s Agreement was both procedurally and substantively unconscionable and should not be enforced. Accordingly, [t]o the extent there are material facts in dispute, we accept the trial court’s resolution of disputed facts when supported by substantial evidence; we presume the court found every fact and drew every permissible inference necessary to support its judgment.

(Citations and internal quotation marks omitted.)

Some easy examples are cited in one of the cases cited in Carlson. In Robertson v. Health Net of California, Inc. (2005) 132 Cal.App.4th 1419, the order denying the motion to compel arbitration was based on the trial court’s conclusion that the arbitration agreement violated a statute. Since this presented a purely legal question of statutory interpretation, review was de novo. Robertson cited Craig v. Brown & Root, Inc. (2000) 84 Cal.App.4th 416 as an example where review for substantial evidence was appropriate, because the order in that case was based on the trial court’s factual finding that the parties never reached agreement on arbitration.

Craig suggests that this analysis is apparently required whenever the validity of an arbitration clause is at issue on appeal, not just on appeals from orders denying a motion to compel arbitration. Craig was an appeal from a final judgment confirming an arbitration award after a motion to compel arbitration had been granted. Yet, Robertson cited to it as an example of how to apply the standard of review.

Mandatory E-filing comes to the Third District Court of Appeal

Details here. The court has adopted a new Local Rule 5 covering e-filing procedures, which become effective September 14. It looks like documents need to be filed through the proprietary TrueFiling system. If you have an appeal pending in the third district now, make sure you register for the e-filing system promptly.

How hanging out with the wrong crowd might doom your appeal of your criminal conviction

Don’t be too alarmed at the title of this post. I’m not saying that the Court of Appeal will take the character of your known friends into account when deciding your appeal. I’m referring to convictions arising out allegations that members of a small group participated in a crime together. If there is no direct evidence that a particular defendant did any particular act, might being one of the group on the scene be enough to convict?

That all depends on what the defendant did with the group and what the group did. In In re Kevin F. (People v. Kevin F.), case no. A140445 (1st Dist., August 10, 2015), the court found the evidence supported a robbery conviction despite the absence of any direct evidence that the defendant himself assaulted the victim or took any of his property.

The defendant (referred to as “Minor” in the opinion) was with a group of three or four men that struck up a conversation with the victim on a commuter train and then, while walking with the victim afterwards, jumped him and stole several items after they entered a dark alley. The victim could identify which in the group had grabbed and held him while the others punched, but he could not identify who landed which punches and could not even say with certainty that all of them participated in the assault. He could say only that he believed all of them participated because he was “being punched in different directions.” The victim testified that he heard all of the men speaking but he could not tell who said what. The victim pursued the group as they ran away. When he caught up to them, the man who had held the victim took a threatening posture and told the victim, “I have a knife,” after which all of the group ran off.  After the assault, the police drove the victim around the neighborhood to see if he recognized anyone. He identified Minor as part of the group that robbed him, but the police found no weapons or any of the victim’s property on Minor.

Now, you might be saying to yourself, how could Minor’s conviction be upheld if nobody testified that he actually took part in the assault or that he took any of the victim’s property? The answer starts with the standard of review:

“Our review of [Minor’s] substantial evidence claim is governed by the same standard applicable to adult criminal cases. [Citation.] ‘In reviewing the sufficiency of the evidence, we must determine “whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.” [Citation.]’ [Citation.] ‘ “[O]ur role on appeal is a limited one.” [Citation.] Under the substantial evidence rule, we must presume in support of the judgment the existence of every fact that the trier of fact could reasonably have deduced from the evidence. [Citation.] Thus, if the circumstances reasonably justify the trier of fact’s findings, the opinion of the reviewing court that the circumstances might also reasonably be reconciled with a contrary finding does not warrant reversal of the judgment. [Citation.]’ [Citation.]” (In re V.V. (2011) 51 Cal.4th 1020, 1026.) Before the judgment of the trial court can be set aside for insufficiency of the evidence, “it must clearly appear that upon no hypothesis whatever is there sufficient substantial evidence to support it.” (People v. Redmond (1969) 71 Cal.2d 745, 755.) An appellate court may not reevaluate the credibility of witnesses. (People v. Ochoa (1993) 6 Cal.4th 1199, 1206.)

The “substantial evidence” threshold doesn’t seem real hard to meet, does it? As you might expect, appeals challenging the sufficiency of the evidence to support the conviction are notoriously hard to win.

Here, the court finds there is substantial evidence supporting a conviction, because there is evidence that: Minor was in the group that the victim met on the train; Minor introduced himself to the victim; Minor was still with the group when it got off the train, and waited outside a liquor store while the victim purchased cigarettes; Minor was with the group when it entered the alley with the victim; the victim was punched from several directions and thus “believed” everyone in the group punched him; no one in the group told the others to stop; Minor fled with the group after the robbery. Thus, “[The victim’s] testimony that Minor was with the group before, during and after the attack, along with [his] testimony about the attack itself (i.e., the young men punched him from different directions, and no one left or tried to stop the others), allows a reasonable inference that Minor participated in the attack.”

Alternatively, the court finds that the evidence is sufficient to establish that Minor aided and abetted  the robbery. Even if the finder of fact did not believe that Minor actually struck the victim or took any of his property, the court finds that it is reasonable to believe that Minor acted as a lookout to facilitate the robbery because he was with the group the entire time and did not state any objection to the assault and robbery.

Now, it might be that Minor did not assault the victim or take any of his property. He might have wanted no part of the assault and robbery, perhaps even been too scared to move or say anything during the crime, and so frightened of being associated with it (or of having to testify against his friends) that he ran off with the group rather than wait around for the police. But such alternate views do not come into play in substantial evidence review. The question is not whether a factfinder could go wither way based on the evidence. The question is whether substantial evidence supports the conviction, even if a reasonable factfinder could go either way.

In short, when any crime is committed in a group — at least, when committed in a small group of 3 to 6 people — it probably won’t matter that there is no direct evidence that a particular defendant did any specific act. So long as there is evidence that the defendant was part of the group and remained with the group before, during and after the crime, and did not object during the crime, the court is likely to find substantial evidence to support the conviction.

Are records on appeal from the Los Angeles Superior Court about to get better?

LASCThe headline is not a dig at anyone at the Los Angeles Superior Court (LASC). It refers to the impact of the statewide court budget crunch, which led many courts to stop providing court reporters as a matter of course. Faced with having to engage court reporters on their own, some litigants were foregoing the expense, at risk of having records inadequate to prosecute their appeals.

As a result, parties are appealing decisions without the reporter’s transcript that they would have been able to order under the old system. That can spell trouble for an appeal.

Last Friday, the LASC announced that it is hiring court reporters. Actually, I can’t tell from the announcement whether they are looking for multiple reporters or just trying to fill a single vacant position. Here’s hoping that it’s the former, and that this is a sign of things to come.

SB 470 codifies Reid v. Google, Inc., provides that objections to summary judgment evidence are preserved for appeal

whichthat2On Monday, according to this article at The Recorder, Governor Brown signed SB 470, amending Code of Civil Procedure section 437c, which governs procedure for motions for summary judgment and summary adjudication. For appellate practitioners, the significance of the bill lies in its codification of Reid v. Google, Inc. (2010) 50 Cal.4th 512. Reid held that objections to evidence submitted in support of a motion for summary judgment are preserved for appeal even if the trial court fails to rule on the objections. Prior to Reid, the courts were split on whether such objections were preserved. I’m unaware of any lingering controversy over the issue since Reid, but it is nonetheless satisfying to see its holding codified.

Specifically, the bill adds the following language to the section 437c:

(q) In granting or denying a motion for summary judgment or summary adjudication, the court need rule only on those objections to evidence that it deems material to its disposition of the motion. Objections to evidence that are not ruled on for purposes of the motion shall be preserved for appellate review.

Trial judges served with dozens of pages of objections are now explicitly excused from ruling on those that they deem immaterial. I think some judges have probably been doing this already with orders such as “Plaintiff’s objections 1-10 granted; all others denied,” especially in light of the holding in Reid, but it is good to see the burden explicitly lifted. Consider this excerpt from the first report on the bill from the Senate Judiciary Committee:

The report cites published opinions that illustrate the large number of objections made in summary judgment papers and the huge volume of motion papers in overall. (See Reid v. Google, Inc. (2010) 50 Cal.4th 512, 532 [“We recognize that it has become common practice for litigants to flood the trial courts with inconsequential written evidentiary objection, without focusing on those that are critical [footnote omitted].”]) The report specifically cites, as an example, the case of Nazir v. United Airlines, Inc. (2009) wherein “the moving papers in support of a summary judgment totaled 1,056 pages, plaintiff’s opposition was nearly three times as long and included 47 objections to evidence, and the defendant’s reply included 764 objections to evidence.” [Citation.]

If you are wondering about the graphic accompanying this post, here’s the explanation. It is in honor of the drafters of SB 470, for eliminating from section 437c three incorrect uses of the word “which.” Misuse of “that” and “which” (most commonly, the improper use of “which” in place of “that”) is a pet peeve of mine — not just in section 437c, but everywhere, including all other California codes, briefs, news media, correspondence and judicial decisions. Yet, I am sure I am guilty of it on occasion. Every once in a while, whether “which” or “that” is the correct word can be a close call, but SB 470 corrected some obvious mistakes. You can see the redline of the amended section 437c here.

Is your notice of appeal likely to generate settlement leverage?

Every so often, I get a prospective appellant who is convinced that filing his notice of appeal will intimidate his adversary, prompting him to “come to the table” to hammer out a deal.

Good luck with that.

It’s not that cases cannot settle on appeal. It’s that most of the time, the mere act of appealing or filing a writ petition does not generate much leverage because the odds are inherently against the success of the appeal. Consider that the reversal rate on appeals generally hovers between 20% and 25%. Would you be intimidated by those odds?

That said, cases do settle on appeal, and some factors in a given case can do a great deal to encourage both sides to settle. (I’ll cover some of those factors in a future post.) Recognizing that some parties, and especially respondents, are less likely to settle on appeal, some courts with mediation programs have required the parties to make some showing that the case has a chance of settling before the court will assign a mediator. Thus, even if the parties are willing to talk, they may not be able to take advantage of the free mediation services offered through the court, and will instead have to engage a private mediator.

For a good overview of the differences between trial-level mediation and appellate mediation, check out this older blog post from last year from mediator David Karp.  David’s blog is one of the Member Blogs of the Month at the TEN Networks Blog, and I’ve gotten to know David a little through that group. His post is spot-on, and offers some insight he’s gained from volunteering his mediation services to the Court of Appeal.

California Supreme Court invites your comment on proposed changes to publication rules involving cases accepted for review

I expect that in this age of electronic research, most lawyers have experienced the frustration of finding the “perfect” case, only to learn it is unpublished and therefore could not be cited as precedent. (See rule 8.1115(a), Cal. Rules of Court.) Even in the “old days,” when research was limited to hard copy books, you could still find the perfect cases whisked out from under you, either because it was later disapproved or, more frustratingly, had been accepted for review by the Supreme Court, which has the effect of automatically de-publishing the case. (See rule 8.1105(e)(1), Cal. Rules of Court.)

That may change. Yesterday, the Supreme Court posted for comment some proposed changes to this scheme.The upshot is that there would be a 180-degree change in the rule, so that published cases accepted for review by the Supreme Court would remain published, with a notation that the case has been accepted for review.

Where things get interesting is in the related issue of the precedential effect of such cases. If cases on review remain published, should they have the same precedential value they had prior to being accepted for review? That’s one proposal (but it also has a provision that the Supreme Court could explicitly limit the precedential value of the decision. The second proposal is that such decisions would not be binding and could be cited only for persuasive value.

The proposal generated quite a bit of buzz on the Los Angeles County Bar Association Appellate Courts Section listerv yesterday. The “if it ain’t broke, don’t fix it” caucus seemed to win the day.

Of course, not everyone agrees that the current system “ain’t broke.” There is an organization dedicated to advocacy for publication of all Court of Appeal opinions. Several years ago, a law firm even sued the Supreme Court over its publication rules.

The issue of the precedential value of cases accepted for review is of concern beyond the appellate community, of course. Published decisions of the Court of Appeal, regardless of the district in which the decision was rendered, are binding on trial courts statewide. Where there are conflicting appellate court decisions, a trial court is free to choose which it will apply.

Since conflicts among the Court of Appeal often generate review by the Supreme Court, trial courts are forced under the current rules not to rely on the more recent decision and treat the earlier one as binding. Someone on the listserv pointed out yesterday that this is unfair, and I tend to agree. After all, where review is granted because of a conflict between two cases, the Supreme Court is likely to disapprove one or the other of them rather than reconcile them. In other words, since the fate of both cases lies in the balance, why should one have greater precedential value than the other?

If you wish to offer the Supreme Court your comments on the proposal, you must do so by September 25, 2015.

Update: Horrendously embarrassing typo in headline fixed!

The appellate angle in Marriage of Davis

Family law attorneys are buzzing this week about Monday’s unanimous Supreme Court decision in Marriage of Davis, case no. S215050 (July 20, 2015). The Metropolitan News-Enterprise summed up the holding this way: “A married person cannot be considered separated, and thus permitted to keep his or her earnings as separate property, while continuing to live with his or her spouse[.]” The court itself referred to its ruling as a “bright-line” rule.

Not so fast, folks. My friend Claudia Ribet has a column in today’s Daily Journal (link requires subscription) discussing the subtleties in the decision and concurring opinion, concluding that it may not even reduce litigation over the “separate and apart” issue very much.

I’ll leave that debate to the family law attorneys for now.

I, of course, am interested in what this decision teaches us about approaching appeals. The obvious lesson is this: an appellant needs to carefully consider the standard of review and, if at all possible, frame an issue on appeal subject to de novo review, in which the appellate court reviews the ruling without any deference to the trial court’s ruling or rationale, as if the case was being decided anew.

As the Supreme Court notes at the outset of its analysis, the date of separation “is normally a factual issue to be reviewed for substantial evidence.” However, the appellant raises an issue of statutory interpretation of Family Code section 771, subdivision(a), thus invoking the more favorable de novo standard of review, and prevails.

In this case, it probably was not too hard for appellant to realize how to latch onto an issue subject to de novo review, since the trial court’s decision went against a court of appeal opinion establishing separate residences a “threshold requirement” of living “separate and apart” for purposes of the statute. Voilà! De novo review of statutory interpretation.

It’s not always that easy. For more difficult cases, see this post and this one.

Overcoming the abuse of discretion standard on appeal of an attorney fee award: what did the trial court actually do?

Respondents use the “abuse of discretion” standard for all it’s worth when defending against appeals, and they should. Often, it’s one heck of a shield. But there are limits to relying on the this standard of review, and the Court of Appeal will reverse in appropriate circumstances.

One such example is last week’s decision in McKenzie v. Ford Motor Co., case no. G049722 (4th Dist., July 10, 2015). Plaintiff rejected one settlement offer in this “lemon law” case, but settled a few months later. The settlement was entered as a judgment. It required Ford to buy back the “lemon” automobile and allowed the plaintiff the option of accepting payment of $15,000 for attorney fees or instead roll the dice with a fee motion. Plaintiff moved for nearly $48,000 in attorney fees, and appealed when the trial court awarded only $28,350.

The trial court explained its award by noting that it deemed all of the fees incurred following the plaintiff’s rejection of an initial settlement offer to be unreasonable, because the only difference in the initial offer and the settlement entered into was the provision allowing him to file an attorney fee motion. To the trial court, this indicated that the 42 hours billed to the case following the plaintiff’s rejection of the earlier settlement offer “amounted to ‘plaintiffs’ counsel exaggerating the amount of their fees to increase their prized fees.'” (Gee, attorneys concerned about getting paid. Who’d of thunk it?)

The Court of Appeal reverses, finding fault with the trial court’s reason for limiting the fee award. Its analysis is helpful to anyone facing the daunting “abuse of discretion” standard of review.

First, the Court of Appeal notes that the trial court erred as a matter of law in characterizing the differences between the initial settlement offer and the eventual settlement, because (1) the trial court was wrong about the first offer not including an option for plaintiff to accept $15,000 or make a fee motion; the settlement and prior offer were actually identical in this regard; and (2) there were many other material differences not noted by the trial court. “The trial court’s erroneous comparison of Ford’s initial compromise offer with the offer McKenzie later accepted fatally undermines its conclusion that the entire amount of hours billed by McKenzie’s counsel in the wake of that initial offer was unjustified.”

Second, the Court of Appeal demonstrates the limits of its duty to indulge all reasonable inferences in favor of the ruling:

Ford counters by first emphasizing our obligation to indulge all inferences in favor of the trial court’s ruling, and pointing out the trial court is not required to explain in detail the basis of its fee decision. Ford urges us to construe the court’s reduction of McKenzie’s fee as reflecting an assessment of the usual lodestar factors considered in determining fee amounts — e.g., the complexity of the case, the expertise of McKenzie’s counsel, and the early stage at which the case was settled — and a resulting determination that $28,350.08 was simply an overall “reasonable” fee for the work performed.

However, while we could certainly do that in the absence of any specific analysis provided by the trial court, we cannot ignore the court’s reasoning when detailed in the order. In this case, the court was quite explicit in explaining the basis for reducing McKenzie’s fees — rather than imposing a general reduction on the fees requested from the outset, on the basis the rates charged by McKenzie’s counsel were too high or the overall time claimed was unreasonable given the complexity of the case, the court characterized its reduction as “based on redaction of fees for duplicated and unnecessary services and billing performed after defendant’s service of its CCP Section 998 offer.” The court awarded McKenzie 100 percent of the fees he requested for the period before Ford’s initial offer, but found the entirety of “the subsequent billing was unreasonable” and excised that specific portion of the fees from McKenzie’s award. When the court states its reasons explicitly, we cannot infer its exercise of discretion rested on a wholly different basis.

(Italics did not appear in the trial court analysis and were added by the Court of Appeal.)

In short, what the court actually did is what matters for the abuse of discretion standard. As the court points out, it may be impossible to know what the court actually did. Had the record in McKenzie not made clear the basis of the court’s exercise of discretion, plaintiff probably would have been sunk on appeal, unless there was no rational basis for the amount of the award.

Having the trial court’s analysis in the record made all the difference in this case. Keep that in mind when your next fee motion approaches.

Don’t give up when your motion to dismiss an appeal is summarily denied

The term “summary denial” sounds pretty bad when you are the party seeking relief. It has an air of finality. Sheesh, not even a hearing on the merits!

But a summary denial is not final in every context. This was recently pointed out in Ellis v. Ellis (2015) 235 Cal.App.4th 837, in which the respondent moved to dismiss the appeal as untimely. The court summarily denied the motion. After the appeal was fully briefed, however, the court advised the parties to be prepared to address the timeliness of the appeal at oral argument, heard argument, and ultimately granted the motion. While I am sure the respondent would have preferred such a ruling prior to briefing the appeal on the merits, I doubt he minded too much that he was put through that time and expense. A win is a win.

At the point in its opinion that it mentioned its summary denial, the court added this footnote: “Of course, a summary denial of a motion to dismiss an appeal does not ‘preclude later full consideration of the issue, accompanied by a written opinion, following review of the entire record and the opportunity for oral argument.’ [Citations.]”

Of course? Maybe people steeped in appellate procedure are familiar with this principle, but I think it would come as a surprise to most people. Now you know, and now you, too, can say of course.

How the nature of your appellate challenge can affect whether your appeal is dismissed for failure to obey trial court orders

The disentitlement doctrine allows a court of appeal to dismiss an appeal as a sanction for the appellant’s refusal to comply with trial court orders that remain in force while the appeal is pending. The lesson to be learned from today’s decision in Ironbridge Global IV, Ltd. v. ScripsAmerica, Inc., case no. B256198 (2d Dist., June 30, 2015) comes from its discussion of how the right kind of appellate challenge to a trial court order — specifically, a jurisdictional challenge — can serve as a defense to the imposition of a dismissal sanction under the disentitlement doctrine. Unfortunately, for the defendant-appellant here learns that calling a challenge a jurisdictional one does not make it so. The Court of Appeal characterizes the defendant’s challenge as a non-jurisdictional one, and dismisses the appeal for the defendant’s violation of the trial court order from which it appealed.

A settlement reached by the parties required defendant to issue plaintiff shares in the defendant corporation, and to issue plaintiff additional shares in the event the value of the shares decreased. The court approved the stipulation and retained jurisdiction to enforce its terms. About six months later, plaintiff applied ex parte for an order compelling the defendant to transfer additional shares to plaintiff and enjoining defendant from issuing shares to anyone else until it until it did so. The court ordered defendant to issue the additional shares within 24 hours and not to issue shares to anyone else until it complied.

In the defendant’s appeal, plaintiff moved to dismiss under the disentitlement doctrine, providing SEC filings showing that defendant had transferred more than 8 million shares to third parties in violation of the injunction. Defendant filed a “paltry” 1-1/2 page opposition to the motion citing “no authority whatsoever,” contending that the order was in excess of the trial court’s authority in that (1) the trial court could not enjoin issuance of shares to third parties because there was no such prohibition in the settlement, and (2) the court could not compel the issuance of shares to plaintiff on an ex parte basis.

The Court of Appeal isn’t buying it. The court acknowledges that “[a] person may refuse to comply with a court and raise as a defense to the imposition of sanctions that the order was beyond the jurisdiction of the court and therefore invalid,” but notes also that a person “may not assert as a defense that the order merely was erroneous.” (Internal quotations and citations omitted.) It finds that the defendant’s challenge falls into the latter category.

First, the court notes that a trial court has continuing power to enforce a stipulated  judgment entered in settlement of a case (Code Civ. Proc., § 664.6) and the power to “compel obedience to its judgments, orders, and process” in proceedings before it (Code Civ. Proc. § 128, subd. (a)(4)). Combined, those powers gave the trial court “authority to fashion orders to enforce compliance with a stipulated judgment.” Though the court does not state so explicitly, its point seems to be that the prohibitory injunction against issuance of shares to third parties was was a permissible coercive measure to enforce the settlement regardless of whether the stipulated judgment addressed such transfers.

The defendant’s challenge to the ex parte nature of the order is dispatched more easily. The settlement itself authorized the court to enforce the settlement on an ex parte basis.

Here, the parties requested that the court retain jurisdiction to enforce the settlement. The stipulation also provided that it could be enforced on an ex parte basis. There is no question that the court had jurisdiction over the parties and the subject matter, and that the parties expressly authorized the court to enforce the settlement on an ex parte basis. We find no procedural irregularity or other defect that would support a credible claim that the order was either void or voidable. Defendant’s appeal merely challenges the order as erroneous.

The lesson here, of course, is that if you are unable or unwilling to comply with a trial court order that remains in force pending an appeal from it, you had better be sure that you have a serious jurisdictional challenge to make against it. Do not convince yourself that your challenge on the merits is a jurisdictional one just because you do not want to obey the order, because the Court of Appeal will look beyond the label on your argument. Absent a solid jurisdictional challenge, disobedience of the trial court order can put your entire appeal at risk.

UPDATE: For those interested in reading more about the disentitlement doctrine, see the article referenced at Southern California Appellate News.

No judicial notice for a law of physics, but for a different reason than you might expect

I had to take the “high track” physics courses as part of my electrical engineering major curriculum at Canoe U. In fact, I liked my physics classes more than my engineering classes, and regret to this day I did not major in physics. So the discussion in Bermudez v. Ciolek, case no. G049510 (2d Dist., June 22, 2015), in which the court refuses to take judicial notice of a law of physics, caught my eye.

Bermudez is an automobile accident case, in which defendant Ciolek was the driver of a car that collided with a second car driven by defendant Heacox, which in turn struck plaintiff, who was on the sidewalk. Though the jury found both drivers negligent, it found only Ciolek liable for plaintiff’s damages.

Ciolek contended on appeal that these findings were inconsistent, i.e., that Heacox’s neglignce must have been a substantial factor in causing plaintiff’s injuries because, absent such negligence, the second vehicle’s ricochet would have been different. Ciolek contended, in the words of the court, that the jury’s findings were irreconcilable “because they ignore the laws of physics by which our universe is governed.”

In support, Ciolek requested that the court take judicial notice of the law of conservation of momentum. Here is an apparent excerpt from Ciolek’s brief, which attached equations and examples:

The law of conservation of momentum provides that in a collision, momentum is conserved; the combined momentum of two colliding objects going into the collision must equal the momentum coming out of it. The momentum of an object equals its mass multiplied by its velocity; velocity is a vector, which in turn is composed of both speed and direction.

Here is a simple demonstration of the principle:

Instinctively, how this principle would have affected the collision sounds like expert witness territory to me. Sure enough, the lack of expert testimony on the issue at trial plays a part in the court’s decision not to take judicial notice, but the basis for its ruling is far more fundamental and needs to be kept in mind by every appellant . . . and you don’t need to know a lick of physics to understand it:

Ciolek’s argument is certainly interesting. Of course, it is not the argument she made at trial. At trial, she claimed Heacox was the sole cause of the collision (and therefore the harm to Bermudez). Ciolek did not ask the trial court to take judicial notice of the law of conservation of momentum and to instruct the jury on its meaning. Ciolek did not ask her accident reconstruction expert to evaluate and opine on the effect of Heacox’s speed on the ricochet. [Footnote.] Faced with a result she did not expect (though it was consistent with the result requested by Bermudez’s counsel and Heacox’s counsel in their closing arguments), Ciolek now suggests the jury reached an illogical verdict based on the supposed common sense of the law of conservation of momentum.

We reject Ciolek’s request to essentially retry the case on appeal and we deny her request for judicial notice as irrelevant to the issues before us. “It is a firmly entrenched principle of appellate practice that litigants must adhere to the theory on which a case was tried. Stated otherwise, a litigant may not change his or her position on appeal and assert a new theory. To permit this change in strategy would be unfair to the trial court and the opposing litigant.” (Brown v. Boren (1999) 74 Cal.App.4th 1303, 1316.) It would be fundamentally unfair to both Heacox and Bermudez to grant a retrial to Ciolek because she wants the chance to try a different theory the second time around.

In short, shifting gears at the appellate level is not allowed. It’s surprising that Ciolek would make an argument like this, given that the appellate court did not even deem this a close call.

A break for some shipmates and a lesson on drilling down on the standard of review

As a graduate of the “Boat School” (or “Canoe U”), I went on alert as soon as I spotted a case in yesterday’s advance sheets regarding whether some local county employees’ time as U.S. Naval Academy Midshipmen (don’t call them “middies”) could enhance their county retirement credits. My shipmates came out on the winning end of things, and the opinion offers a lesson on appellate procedure.

The issue in Lanquist v. Ventura County Employees’ Retirement Association (case no. B251179, 2d. Dist., March 16, 2015) is succinctly stated in the first paragraph of the opinion:

Ventura County Employees’ Retirement Association (VCERA) permits employees to purchase retirement service credit for time spent in military service. It excludes time spent as a midshipman at the United States Naval Academy (Academy).Our interpretation of a Ventura County Board of Supervisors’ resolution, adopting the County Employees Retirement Law (CERL), leads us to the opposite conclusion.”Military service” includes service as a midshipman.
The journey for the plaintiff employees started with their applications to purchase credits for their time at the Academy, then wound through assorted administrative proceedings that denied their applications. The plaintiffs filed a petition for writ of mandate in the superior court, which denied the petition.

On the ensuing appeal, the trial court’s decision is reviewed de novo. That does not mean, of course, that the underlying administrative decision is likewise reviewed de novo. De novo review of the trial court’s decision means that the appellate court has to put itself in the shoes of the trial court and review the administrative decision under the standard of review that the trial court was required to apply. Normally, review of such a quasi-legislative administrative body’s decision is limited to whether the decision  was “arbitrary, capricious, lacking in evidentiary support, or contrary to procedures provided by law.” (Citations omitted.) But here, the plaintiffs got a break from the fact that the administrative body had construed a statute rather than exercise discretionary rule-making power. Thus, the ruling was subject to heightened review: “We tak[e] ultimate responsibility for the construction of the statute, [but] accord[] great weight and respect to the administrative construction.” (Citation and internal quotation marks omitted.) Under that level of scrutiny, the administrative body’s interpretation of the statute did not hold up, and the plaintiffs’ time as midshipmen was held to be subject to the retirement service credit purchase scheme.

That’s a welcome surprise, given that time for service at the Academy is not counted toward time in service for purposes of calculating military retirement pay for retiring officers. Presumably, the federal statutes cited by the court in its analysis apply with equal force to graduates of other service academies and thus former Zoomies, Woops, and Coasties working for Ventura County are likewise eligible for this program.***

The larger lesson to be drawn is that one should not be automatically discouraged by the default standard of review. Take a careful look at the case to see if a more favorable standard of review can be invoked. And kudos to these plaintiffs, both of whom were self-represented but only one of whom is an attorney.

***Believe me, use of these nicknames is all in good fun — there is a healthy respect for each other among the academies, but the good-natured rivalries among them can make it look otherwise. Stanford-Cal, Alabama-Auburn, and other college rivalries have got nothing on Army-Navy. Go Navy! Beat Army!

Don’t lightly assume that you’ve extended your time to appeal with a post-trial motion

The parties in your case have stipulated to have their case tried before a temporary judge (pursuant to Cal. Const., art. VI, § 21) and filed all trial-related papers (trial briefs, closing briefs, and requests for statement of decision) directly with the temporary judge at his alternative dispute resolution service.

So, where should you file your motion to vacate the judgment under Code of Civil Procedure sections 663 and 663a? The answer is: with the clerk of the superior court. (As all documents should be, pursuant to Cal. Rules of Court, rule 2.400(b).)

The appellant in Gonzalez v. Aroura Loan Services, LLC, case no. B247366 (2d Dist., Nov. 17, 2014) learned that lesson the hard way, but not through having its motion to vacate denied. In fact, the judge never even ruled on the motion. But the appellant suffered another consequence from filing its motion to vacate directly with the temporary judge instead of with the clerk of the superior court. Its appeal was dismissed as untimely because the improperly filed motion to vacate did not trigger the extension of time to file the notice of appeal described in rule 8.108(c), California Rules of Court.

Rule 8.108(c) extends the time to appeal whenever a party files “a valid notice of intention to move — or a valid motion — to vacate the judgment.” (Emphasis added.) The court held that the motion to vacate filed directly with the temporary judge was not valid because section 663 directs that the moving party ” shall file with the clerk and serve upon the adverse party a notice of his or her intention, designating the grounds upon which the motion will be made[.]” (Emphasis added.) Thus, the rule 8.108(c) extension was never triggered. Without that extension, the appellant’s notice of appeal was untimely.

I cannot emphasize enough how critical it is that a party file its notice of appeal on time. Gonzalez has more to say on this broader topic, which I will save for another post.

Doesn’t anybody read the rules?

When is a brief written by a lay person likely to be of comparable quality to a brief written by lawyer for the other side in the same case? When both briefs stink:

Brooks’s opening brief on appeal includes a statement of facts without any citation to the record. In the argument portion of the brief, references to facts are occasionally, but not consistently, supported by citations to the record. ECG’s respondent’s brief, which relies extensively upon facts developed at trial, does not include a single citation to the record. The failure to include citations to the record violates rule 8.204(a)(1)(C) of the California Rules of Court: Briefs must “[s]upport any reference to a matter in the record by a citation to the volume and page number of the record where the matter appears.” Although these failures subject the briefs to being stricken, we have elected to disregard the noncompliance. (Cal. Rules of Court, rule 8.204(e)(2)(C).)

(In re Marriage of Brooks and Robinson (2008) 169 Cal.App.4th 176, 180 fn. 1.) Maybe stink is a strong word. It’s possible the briefs made excellent points and were terrible only in their failure to comply with the rule requiring citations to the record. But still . . . the odds that neither side would comply with such a basic rule strike me as being quite low. Here, one of the parties (Brooks) was self-represented, but I’m betting that somewhere out there are cases with lawyers on both sides of the appeal filing non-conforming briefs.

This sounds like the beginning of a pitch urging you to employ an appellate attorney, doesn’t it?

You know what I do when I have a question about procedure? This is a really radical concept for some . . . I look up the applicable rule. You don’t have to be a rocket scientist — or even an appellate lawyer — to realize that’s a good idea.

When winning is risky

Sometimes, an appeal doesn’t make sense to me. This can be true even if there are better-than-average odds of winning. When an appeal doesn’t make sense to me, I ask why the party wants to appeal. I’m sure that most of the time, the reaction is to think, “Isn’t it obvious? Because I lost!” But to my mind, that’s not always a good enough reason. As a matter of effective client relations, I get curious about motives when it seems to me, as an outsider, that a win on appeal would yield a negligible benefit or even risk making the appellant worse off.

An example of the latter situation is Department of Fair Employment and Housing v. Ottovich, case no. A136607 (1st Dist.  June 30, 2014), where I think the appellant potentially had a whole lot to lose by winning the appeal.

The appellant was the defendant below, where the trial court struck his answer and entered his default as sanctions for discovery misconduct. Judgment for more than $240,000 was entered after the prove-up hearing. The defendant successfully moved to set aside the default judgment (and underlying default) based on the plaintiff’s failure to serve a statement of damages, but the court left the answer stricken, granted summary judgment on liability based on the allegations of the complaint, and held a jury trial on damages, which resulted in a judgment for the plaintiff of only $8,500. If I were the defendant, I think I would have been thankful for avoiding that judgment of nearly a quarter million dollars, counted my blessings that my liability was only $8,500, and called it a day.

Not so for the appellant here, who contended that when the default judgment was vacated, his answer was revived as a matter of law. Clearly, the appellant wanted the issue of liability tried, and wanted to pay zero.

The appellant lost his appeal, but suppose he had won. What’s the up side? Sure, the case gets to proceed on the merits. But appellant, if found liable, would be facing a new damages determination. Who’s to say that a less-friendly jury or better lawyering for the plaintiff the next time around wouldn’t result in a judgment against the appellant far in excess of $8,500?

I have to think there was something besides money driving the decision to appeal in this case. . . or maybe I’m wrong about the process after reversal and there would be some way to avoid having damages tried again (if you think so, shoot me an email, and I will happily correct the post, if warranted). But going solely by what I can glean from the decision, I would have advised against the appeal.

Any litigation, including an appeal, involves risk. Consider that reversal rates hover around 20% and that you may be throwing good money after bad. There is enough risk in the possibility of losing. Why pursue an appeal where winning could make you worse off?

Sometimes the standard of review is better than you might first think

Clients (and their lawyers) can be disheartened when they conclude that the ruling they want to challenge on appeal is subject to review for abuse of discretion — a standard of review that is indeed daunting. But keep in mind that rulings ordinarily subject to review for abuse of discretion may be subject to the much more appellant-friendly de novo (or independent) standard of review, in which the court of appeal decides the issue without any deference to the trial court.

The defendant-appellant in Children’s Hospital Central California v. Blue Cross of California, case no. F065603 (5th Dist. June 9, 2010) was able to take advantage of this situation. Blue Cross had a contract with the state to provide a managed care plan for Medi-Cal recipients. Plaintiff hospital and Blue Cross had a written rate agreement that lapsed, and did not enter into a new agreement for about ten months. In the interim, the hospital kept providing services and Blue Cross paid the hospital more than $4 million based on government Medi-Cal rates, but the hospital contended that the reasonable value of the services provided was nearly $11 million, and sued to recover the difference.

Blue Cross contended that the trial court improperly limited the evidence of the reasonable value of the services by denying Blue Cross’s discovery motion to compel the production of the hospital’s written agreements with other insurers and granting the hospital’s motion in limine to preclude any evidence of the rates accepted by or paid to Hospital by other payors, the Medi-Cal and Medicare fee for service rates paid by the government, and Hospital’s service specific costs. The hospital contended that reasonable reimbursement rates were governed solely by the six factors set forth in a regulation.

Normally discovery rulings and evidentiary ruling are subject to review for abuse of discretion. Here, however, Blue Cross benefited from a de novo standard, because the basis for the trial court’s rulings — its conclusion that the evidence was irrelevant — is an “analysis of the substantive law governing the case,” making it a legal issue subject to independent review.

The abuse of discretion standard is full of nuance. Don’t let it automatically discourage you from pursuing an appeal. Instead, consider the actual error to be asserted to see if it comes within independent review.

A substantial evidence argument works on appeal

Substantial evidence challenges don’t succeed very often on appeal, so I sat up and took notice when I saw a successful challenge to the sufficiency of the evidence in today’s decision in Martinez v. County of Ventura, case no. B244776 (2d. Dist April 8. 2014). The Court of Appeal reverses a judgment for the public agency defendant that had successfully asserted a design immunity defense at trial to avoid liability for a defectively dangerous roadside condition that contributed to the plaintiff’s injuries. The burden of proof was on the county to establish that they had made a discretionary design decision in installing the type of roadside drain at issue. However, they were unable to produce any plans for the type of drain involved or any evidence that someone with discretionary authority had actually approved the design.

The substantial evidence standard my not require much evidence to affirm a judgment, but it requires enough that a rational factfinder could reasonably reach the conclusion supporting the judgment. Here, “[t]he evidence showed that the maintenance workers simply built and installed the drains in the field as they saw the need for them.”  A county official testified that he had approved the design, but that county did not have discretionary authority under the law, nor was there any evidence that the official that did have discretionary authority had delegated any authority to the testifying official.

Too many parties (and, unfortunately, even some lawyers) do not understand the substantial evidence standard of review. (That’s a subject for another post.) Some write it off from consideration because it is usually very difficult to win. But Martinez reminds us that the argument should not be overlooked just because it is usually difficult.

What happens when standards of review collide?

Sometimes . . . nothing. As in Pielstick v. MidFirst Bank, case no. B247106 (2d Dist. Mar 26, 2014), in which the court was asked to reverse the trial court’s refusal to allow a plaintiff to voluntarily dismiss his suit after the hearing on demurrers had begun. First issue: what standard of review applies?

There is some conflicting authority as to the appropriate standard of review for a request to voluntarily dismiss a case pursuant to section 581. The majority of cases apply a de novo standard, reviewing the issue as a matter of law where it involves the application of undisputed facts to the statute. [Citations.]

However, in Tire Distributors, Inc. v. Cobrae (2005) 132 Cal.App.4th 538 (Tire Distributors), Division Eight of this District held that an abuse of discretion standard is more appropriate, noting that “every court to consider the issue has based its holding on the facts and circumstances surrounding the dismissal, evaluating whether allowing the dismissal to stand would be unfair or would endorse dishonest litigation tactics.”

This conflict doesn’t turn out to be a problem for the court at all, as it concludes: “We find that we need not resolve the apparent conflict between the cases cited above. Under either standard, no error occurred.” (Emphasis added.)

Once again, an appellate court demonstrates that it will not decide issues unnecessary to the resolution of the case.

The consequences of reluctant unanimity in appellate decisions

Through LinkedIn, I ran across an interesting appellate blog, Briefly Writing. In a post yesterday, blogger Michael Skotnicki shared his alarm at learning from the Eleventh Circuit’s chief judge that panel judges that initially dissent will “routinely” change their votes in order to make the decision unanimous (presumably, only once it is apparent that the majority judges cannot be persuaded to come around to the dissenter’s point of view). Skotnicki believes the practice harms appellate counsel because a losing client may think that the unanimity of the decision suggests he got bad advice or bad advocacy during the course of the appeal, and a wining client may think that unanimity is evidence that the lawyer’s assistance wasn’t that valuable.

I think there are broader implications. Skotnicki notes that the chief judge said this practice results from a sense of comity among the judges and the desire to strengthen precedent. I don’t begrudge any judge the desire to strengthen precedent through unanimity — a desire that has been expressed by Chief Justice John Roberts of the United Stated Supreme Court —  but I think that how a panel gets to a unanimous opinion matters a lot. If an initial opinion that splits a panel can be re-drafted in a way that accommodates a dissenter without unduly weakening the central point of the initial majority– a tall order, I’ll grant —  then the resulting unanimity is well-achieved.

However, changing votes based merely on comity and a desire for strengthened precedent are bad, not just for the lawyers, but for the system. Split decisions are significant in at least two common scenarios.

At the federal level, where circuit precedent may only be changed through en banc review, the dissent can have an impact on whether the circuit will rehear the case en banc. Whether en banc review is sought of the split decision itself or of a later unanimous decision compelled by a split-decision precedent, it seems to me that a principled dissent can influence can make the difference as to whether or not en banc review will be granted, and even have an impact on the ultimate decision reached on en banc review.

In California appellate courts , where a panel is free to depart from decisions by other panels, even those in its own district (that may shock some of you non-California lawyers, but it’s true), a well-reasoned dissent may be just what convinces the appellate court that the precedent was wrongly decided.

I cannot imagine that comity and a desire to strengthen precedent are ever the only reasons for a dissenting judge or justice to change his or her vote, in the Eleventh Circuit or anywhere else. Maybe there was more to the chief judge’s comments on that topic?

Thoughts on publication of opinions imposing appellate sanctions for frivolousness

This recent Southern California Appellate News post by Ben Shatz led me to a case that got me thinking further about the utility of publishing opinions imposing appellate sanctions. More than six years ago, I posted in response to a law review article that Ben co-authored with another, which surveyed the cases imposing appellate sanctions. As I recall, the article limited the time frame of the survey to the period since unpublished decisions became available online, since so many of the decisions imposing sanctions are never published. That led me to write:

I was struck by how many of the cited cases were unreported.  The Court of Appeal should want to publicize the conduct that leads to sanctions, because this would inform and deter.  It could be that sanctions are so rare (awarded in approximately 1 out of every 500 cases during the studied period) that the Court of Appeal finds additional deterrence unnecessary.

My thinking at the time was that, as a rule of thumb, opinions imposing appellate sanctions should generally be published, but I hadn’t really taken into account the criteria for publication. The mere imposition of sanctions does not automatically fit within any of the established criteria for publication in rule 8.1105(c)(6), Cal. Rules of Court. I was thinking in the abstract that publication should be encouraged, even if it meant amending rule 8.1105.

However, I think my initial concerns were probably misplaced. Educating attorneys on what is and is not sanctionable was the intent behind my initial thought that sanctions decisions should be published, but is that really needed? Consider the standard for frivolousness:  “whether any reasonable person would agree that the point is totally and completely devoid of merit.” In other words, no reasonable person would agree that the point is not frivolous. Doe we need guidance on that?

That standard for frivolousness is at odds with the idea that any sanctions decision would be a close call. Publication of an opinion imposing sanctions for frivolousness might frequently undermine the very basis for the imposition of sanctions, because it would suggest that the imposition of sanctions was a close enough call that it requires an explanation justifying publication under rule 8.1105. Those should be rare occasions, indeed.

If you have thoughts on this, feel free to leave them in the comments.

Make the argument yours, not someone else’s

You represent an appellant in a state court action who claims the action is precluded by a prior federal court action because the plaintiff split his cause of action between the two lawsuits. Your first argument is under the longstanding “primary rights” standard applied by the California courts. Your second is that the court should apply the federal “transaction” standard, which is far more favorable to your position. Only one standard can apply, and you are asking the appellate court to apply a federal standard not previously applied by the California courts. Throw into the mix the fact that the continuing vitality of the California “primary rights” standard was recently reaffirmed by the California Supreme Court, and you can see you’ve got your work cut out for you.

That is the uphill climb that appellant faced in FujiFilm Corp. v. Yang, case no. B243770 (2d Dist., Jan. 24, 2014). The Court of Appeal rejects the invitation to apply the federal “transaction” standard and holds that under the California “primary right” standard, there was no splitting of the cause of action, and thus no preclusion.

One can debate the best way to argue for application of the federal standard — if at all — in such circumstances. Perhaps unique underlying facts or the federal-state dichotomy between the two actions would give an opening to argue that the federal standard should be applied in this particular instance. But nothing like that is mentioned in the Court of Appeal’s rather uncharitable assessment of the appellant’s effort (emphasis mine):

Appellant urges that we apply the “transaction” doctrine of federal law, instead of California’s primary rights theory, to find Fuji wrongfully split its cause of action. We need not linger on appellant’s request, however, because she does not cite any California authority applying the transaction doctrine to define a cause of action. Instead of pertinent case law to support her position, her appellant’s brief relies solely on an eight-and-a-half page block quotation from a 15-year-old law review article. But our Supreme Court as recently as three years ago affirmed that the primary rights theory applies in California. [Citation.] We are not free to depart from binding Supreme Court precedent, and we decline appellant’s invitation to make new law by adopting the federal transaction doctrine. [Citation.]

That’s some quotation!

Was the appellant just trying to tee the case up for review by the California Supreme Court? We’ll see. I’ll update this post if a petition for review is filed.

UPDATE (3/28/2014): The remittitur issued today. No petition for review was filed with the Supreme Court.

Emotional interest falls short of legal standing to appeal dependency ruling

As a general rule, only a person “aggrieved” by a judgment has standing to appeal from it. Is a mother without reunification services “aggrieved” by a judgment granting her 18-year-old child’s request for the termination of dependency jurisdiction? The Court of Appeal answers “no” in In re J.C., case no. G048720 (4th Dist. January 21, 2014), and dismisses the appeal.

J.C., the child of divorced parents, had been living with her father before being declared a dependent of the court a few months after her 15th birthday, when the court found that her father failed to ensure she attended school or get treatment for a psychiatric condition. After treatment at a facility, J.C. was placed in foster care and continued to improve. On her 18th birthday, she asked the court to terminate dependency jurisdiction (though she could have remained a dependent until age 21) so she could return to living with her father. Her mother appealed.

Emotion naturally runs high in dependency cases, but standing based on emotional concern for a child is not enough to confer legal standing to appeal:

Mother asserts she has standing because the termination of jurisdiction resulted in J.C. living with father, and mother worries father will neglect J.C.’s psychiatric treatment, which will damage mother’s relationship with J.C. That interest, while perfectly understandable on an emotional level, does not confer legal standing.

The court does not casually dismiss mother’s interest here. The opinion walks the reader through the standing analysis rather clearly, starting with the proposition that while standing to appeal is liberally construed, only a person “aggrieved” by a decision may appeal from it. That requires a court to “precisely identify [the appellant’s] interest in the matter.”

The court noted that a parent’s interest in the companionship, care, custody and management of a child “is no longer paramount” once reunification services end; at that point, “the focus shifts to the needs of the child for permanency and stability.” Mother this faced an uphill battle to prove standing because her interest had been “significantly reduced” upon the termination of reunification services

But it was the fact that J.C. had turned 18 that ultimately precluded standing. The Court stated that J.C.’s decision to ask for termination of dependency jurisdiction was an exercise of her “rights and responsibilities that come with adulthood” and thus not subject to parental oversight — a point illustrated by the fact that mother was not even entitled to notice of the hearing on J.C.’s request for termination of dependency jurisdiction.

Judge’s disqualification results in new trial for failure to issue a statement of decision

Appeals based on a trial court’s refusal to issue a statement of decision require some soul searching. Usually, a successful appeal will merely result in the case being remanded to the trial court to issue a statement of decision, and the successful appellant may find himself no better off than he was before.

But what if the judge that tried the case is not available to issue the statement of decision? In Wallis v. PHL Associates, Inc., case no. C066545 (3d Dist., October 17, 2013), you will find out. The judge who conducted the bench trial in Wallis was peremptorily disqualified after the bench trial. Since he was thus unavailable to prepare a statement of decision, the Court of Appeal decides that “the only appropriate appellate remedy in this case is a remand for a new trial on the equitable causes of action.”

A standard of review that’s a mouthful

Appellate Attorney Jeanne Collachia is both witty and correct with this statement on her website: “Just like there are three things you need to know about real estate, there are three things you need to know about appeals — Standard of Review — Standard of Review — Standard of Review.” Naturally, I have stressed the standard of review too, with many posts at least touching on subtleties in the standard of review or disputes over which standard applies. Determining the applicable standard can sometimes be tricky. Sometimes, multiple standards apply, each applicable to a different stage of reasoning.

Now, imagine you’re an accountant representing himself on a writ of administrative mandamus, challenging the revocation of your Certified Public Accountant license. You’re not a lawyer, so you would probably appreciate an easy-to-understand, easy-to-apply standard of review. But you wouldn’t get it, as the self-represented plaintiff and appellant in Cassidy v. California Board of Accountancy, case no. G046663 (Fourth District, Sept. 9, 2013, publication ordered Oct. 16, 2013, learned the hard way:

When considering a petition for a writ of administrative mandamus, a court (whether a trial court in the first instance or an appellate court on appeal from the trial court‟s decision) considers the administrative agency‟s findings and decision to determine whether they are supported by the evidence and may also consider whether the agency abused its discretion in imposing its penalty. (Cal. Administrative Hearing Practice (Cont.Ed.Bar 2d ed. 2010) § 8.107, p. 495.)
Code of Civil Procedure section 1094.5 delimits the scope of the trialcourt‟s inquiry. The trial court considers whether the respondent agency lacked jurisdiction; “whether there was a fair trial; and whether there was any prejudicial abuse of discretion. Abuse of discretion is established if the respondent has not proceeded in the manner required by law, the . . . decision is not supported by the findings, or the findings are not supported by the evidence.” (Id., subd. (b).) In reviewing the findings, the trial court exercises its independent judgment if statutorily required to do so or if the administrative decision involves a “„fundamental vested right‟” (2 Cal. Administrative Mandamus (Cont.Ed.Bar 3d ed. 2011) § 16.52, p. 640), such as revocation of a professional license (Bixby v. Pierno (1971) 4 Cal.3d 130, 146). In such cases, “abuse of discretion is established if the court determines that the findings are not supported by the weight of the evidence.” (Code Civ. Proc., § 1094.5, subd. (c).) Nonetheless, “[i]n exercising its independent judgment, a trial court must afford a strong presumption of correctness concerning the administrative findings, and the party challenging the administrative decision bears the burden of convincing the court that the administrative findings are contrary to the weight of the evidence.” (Fukuda v. City of Angels (1999) 20 Cal.4th 805, 817 (Fukuda).) “The scope of the trial before the superior court is not an unqualified or unlimited trial de novo, but the trial proceeds upon a consideration of the record of the administrative proceedings which is received in evidence and marked as an exhibit.” (Borror v. Department of Investment (1971) 15 Cal.App.3d 531, 537; see also Helene Curtis, Inc. v. Los Angeles County Assessment Appeals Bds. (2004) 121 Cal.App.4th 29, 37 [in Code Civ. Proc., § 1094.5 proceeding, evidence limited to administrative record with the narrow, discretionary exception set forth in subd. (e) for evidence that could not reasonably have been produced or was improperly excluded at administrative hearing].)
An appellate court applies the following standards of review to a trial court‟s denial of a petition for a writ of administrative mandamus. First, if the trial court exercised its independent judgment, we review the record to determine whether the court‟s factual findings are supported by substantial evidence, resolving all evidentiary conflicts and drawing all legitimate and reasonable inferences in favor of the court‟s decision. (Fukuda, supra, 20 Cal.4th at p. 824 [“Even when, as here, the trial court is required to review an administrative decision under the independent judgment standard of review, the standard of review on appeal of the trial court‟s determination is the substantial evidence test”]; Bixby v. Pierno, supra, 4 Cal.3d 130, 143, fn. 10 [“After the trial court has exercised its independent judgment upon the weight of the evidence, an appellate court need only review the record to determine whether the trial court‟s findings are supported by substantial evidence”].) Second, “to the extent pure questions of law (e.g., jurisdiction) were decided at the trial court upon undisputed facts, a de novo standard will apply at the appellate level.” (Anserv Ins. Services, Inc.. v. Kelso (2000) 83 Cal.App.4th 197, 204.) Third, we review de novo whether the agency‟s imposition of aparticular penalty on the petitioner constituted an abuse of discretion by the agency. (Antelope Valley Press v. Poizner (2008) 162 Cal.App.4th 839, 851; Szmaciarz v. State Personnel Bd. (1978) 79 Cal.App.3d 904, 921.) But we will not disturb the agency’s choice of penalty absent “an arbitrary, capricious or patently abusive exercise of discretion” by the administrative agency. (Cadilla v. Board of Medical Examiners (1972) 26 Cal.App.3d 961, 966.)
So, how do you suppose this pro per appellant fared? Unsurprisingly, the Court of Appeal observed that “On appeal, Cassidy in many respects misapprehends the scope of our review.” No doubt, he considered it “legalese.”

Appellate lessons abound in case involving a creative but dubious argument on how a tentative ruling should affect appellate review

Last year, I wrote about a dubious but creative argument by a respondent that a party’s submission to a tentative ruling on a motion forfeited that party’s right to challenge the motion ruling on appeal. As you might remember, that went nowhere.

The latest creative (and dubious) use on appeal of a tentative ruling — again unsuccessful — comes in Meddock v. County of Yolo, case no. C070262 (3d Dist., filed Sept. 10, 2013, ordered published October 4, 2013). Meddock appealed from a summary judgment for the defendant. His argument on how the tentative ruling on the defendant’s summary judgment motion should play into the appellate court’s analysis, and the court’s rejection of that argument, appear in footnote 4 of the opinion:

Quoting the generality that “doubts” about summary judgment should be resolved against granting it (see, e.g., Hamburg v. Wal-Mart Stores, Inc. (2004) 116 Cal.App.4th 497, 502 (Hamburg)) and noting that the tentative ruling was in his favor, Meddock asserts the trial court must have had doubts, and therefore summary judgment was improper. Meddock cites no authority to support this argument. To agree with his argument would defeat the purpose of tentative rulings, that is, to focus the parties on the dispositive issues before the court (see Younger, Cal. Motions (2011–2012) Tentative Rulings, § 4.53, p. 132) and would preclude us from exercising our independent review to determine whether triable issues of fact exist. (See Hamburg, supra, 116 Cal.App.4th at pp. 502–503.) Moreover, the theory on which the tentative ruling was based — that the pavement contributed to the accident — has been abandoned by Meddock, as we have explained ante.

To my mind, the court should have given more emphasis to the point that the appellant’s argument is inconsistent with the independent review of a summary judgment. It does make the point, noting that accepting the appellant’s argument “would preclude us from exercising our independent review to determine whether triable issues of fact exist” — another way of saying that the trial court’s doubts are irrelevant because the trial court’s exercise of discretion is not at issue in the independent review afforded a summary judgment — but it is a shame to see the point buried in the middle of the footnote. As correct as the other points in the footnote may be, they are just gravy.

The other appellate lessons in this case have nothing to do with the trial court’s tentative ruling, but it is unusual to see so many strung together in one case:

  1. Make it or waive it. Meddock had multiple arguments he could have made in opposition to summary judgment, but explicitly disclaimed several at the summary judgment hearing and made no attempt to argue them on appeal, so they were deemed abandoned.
  2. Watch what you concede on a summary judgment motion. Parties sometimes concede facts on summary judgment knowing that the concession will not bind them at trial. But why do so when the moving party fails to provide supporting evidence for them? Here, the decision notes that both sides made unsupported factual assertions, but the court accepted them as true since the parties agreed on them.
  3. Keep your standards of review straight. Appellant wasn’t the only party to advance an argument inconsistent with the standard of review. The respondent argued that evidentiary gaps in the record must be construed in its favor. This argument apparently relied on the general rule that an appellate court “must draw reasonable evidentiary inferences in favor of the judgment,” but that rule has no application in the independent review afforded a summary judgment.

Supreme Court reverses Kurwa v. Kislinger – there are limits to the manufacture of appellate jurisdiction

Even most non-appellate lawyers are familiar with the “one final judgment rule,” under which a judgment is not appealable unless it disposes of all of the claims between the parties to the appeal. Plaintiffs who have had some (but not all) claims dismissed after a demurrer or summary adjudication either have to defer appellate review of the ruling until the remaining claims have been resolved, or dismiss the remaining claims with prejudice so as to create a judgment that disposes of all claims and is thus appealable. (Of course, the plaintiff also has the option of petitioning for writ relief from the summary adjudication order.)

In Kurwa v. Kislinger (2013) 57 Cal.4th 1097, the parties tried to preserve their defamation crossclaims against each other by stipulating to dismiss them without prejudice and waiving the statute of limitations, so that they could be revived after the appeal of the ruling knocking out the plaintiff’s claim for breach of fiduciary duty and related claims. Prior to the Court of Appeal decision in Kurwa, a consistent line of cases starting with Don Jose’s Restaurant, Inc. v. Truck insurance Exchange (1997) 53 Cal.App.4th 115 had held that such an arrangement did not create an appealable judgment because there was no finality in the disposition of the dismissed claims. The Court of Appeal in Kurwa, however, departed from this reasoning and concluded that dismissals without prejudice and with waivers of the statute of limitations create an appealable judgment because there are no longer any claims “pending” in the trial court.

The Supreme Court reverses in a unanimous decision:

We disagree with the appellate court below, and agree with Don Jose’s and the decisions following it, including Abatti [v. Imperial Irrigation Dist. (2012) 205 Cal.App.4th 650] . When, as here, the trial court has resolved some causes of action and the others are voluntarily dismissed, but the parties have agreed to preserve the voluntarily dismissed counts for potential litigation upon conclusion of the appeal from the judgment rendered, the judgment is one that “fails to complete the disposition of all the causes of action between the parties” (Morehart [v. County of Santa Barbara], supra, [1994] 7 Cal.4th [725] at p. 743) and is therefore not appealable.

The Court of Appeal below was correct that causes of action the parties have dismissed without prejudice are no longer pending in the trial court, in the sense that no immediate action remains for the trial court to take on such counts. But where the parties, by waiver or agreed tolling of the statute of limitations or a similar agreement, have arranged for those causes of action to be resurrected upon completion of the appeal, they remain “legally alive” in substance and effect. (Hill v. City of Clovis, supra, [1998] 63 Cal.App.4th [434] at p. 445.) The rule of the lower court, under which a voluntary dismissal is considered to dispose of a cause of action regardless of any agreement facilitating its future litigation, elevates form over substance and permits parties to evade the one final judgment rule of section 904.1, subdivision (a), through what the Don Jose’s court aptly called an “artifice.” (Don Jose’s, supra, 53 Cal.App.4th at p. 116.)

The Abatti case mentioned by the Supreme Court was decided after the Court of Appeal had decided Kurwa and represents a middle ground. In Abatti, judgment was entered after the plaintiff dismissed claims without prejudice and without any waiver or tolling of the statute of limitations. This absence of an agreement assuring that the dismissed claims could be litigated following the appeal was a distinguishing feature in the eyes of the Abatti court:

[C]laims that are dismissed without prejudice are no less final for purposes of the one final judgment rule than are adjudicated claims, unless, as in Don Jose’s Restaurant and its progeny, there is a stipulation between the parties that facilitates potential future litigation of the dismissed claims.

Interestingly, the Supreme Court specifically states that it agrees with Abatti even though its Kurwa opinion explicitly limits the issue before the court to those cases that, unlike the dismissals without prejudice in Abatti, include stipulations to keep the dismissed claims alive:

This case poses the question whether an appeal may be taken when the judgment disposes of fewer than all the pled causes of action by dismissal with prejudice, and the parties agree to dismiss the remaining counts without prejudice and waive operation of the statute of limitations on those remaining causes of action.

In an amicus brief, the California Academy of Appellate Lawyers raises a point that has always bugged me. The one final judgment rule is frequently cited as a means to avoid piecemeal litigation, but that is only true of litigation in the Court of Appeal. It necessarily means that cases may have to be tried piecemeal. The Academy argued that a rule on finality should promote efficiency at the trial level as well as the appellate level by allowing the parties “as much autonomy and choice as possible.” The Supreme Court isn’t buying it:

We are not free, however, to adopt whatever rule we find best balances the interests of party autonomy or trial and appellate efficiency. Unlike jurisdictions that provide for trial courts’ selective entry of final judgments on fewer than all claims for relief (see, e.g., Fed. Rules Civ.Proc., rule 54(b), 28 U.S.C.) or for interlocutory appeals in the discretion of the reviewing court (see, e.g., 28 U.S.C. § 1292(b)), California law provides no case-by-case efficiency exception to the one final judgment rule for appealability. Where unusual circumstances justify it, review of interlocutory judgments may be obtained by petition for writ of mandate, but not by appeal. ([Code Civ. Proc.,] § 904.1, subd. (a); Morehart, supra, 7 Cal.4th at pp. 743-744.) The question is thus not what rule will best serve litigants and trial courts, but what rule is most consistent with the policy against piecemeal appeals codified in section 904.1 and vindicated in Morehart.

I think the court paints a somewhat rosy picture of writ review here by referring merely to “unusual circumstances” without mentioning that those circumstances are found present in less than 10% of writ proceedings. Nonetheless, a prospective appellant who values the claims disposed of by the trial court more than his remaining claims, but wants to keep all options open as long as possible, should consider first seeking writ review and, if unsuccessful, then dismiss his remaining claims with prejudice and appeal from the ensuing judgment

“Normally, we would begin by . . . ” — departures from the usual analytical framework on appeal

Any time a Court of Appeal decision starts its analysis with “normally,” you should sit up and take notice. It gives you a hint that the case may suggest ways for you to depart slightly from the normal analytical framework when the right case presents itself.

This time, the tip comes from Liberty Mutual Ins. Co. v.  Brookfield Crystal Cove, LLC, case no. G046731 (4th Dist., August 28, 2013, modified September 26, 2013). The plaintiff was an insurer that sued a contractor in subrogation to recover costs for its insured’s relocation expenses incurred while repairs were being made to property damage resulting from construction defects. The contractor successfully demurred on the ground that the complaint was barred by the limitations period in the Right to Repair Act (Civ. Code, § 895 et seq.). On appeal, the insurer contended that the Right to Repair Act did not abrogate common law remedies for construction defects resulting in actual property damage.

The case presents a straight-up question of statutory construction: is the Right to Repair Act the exclusive remedy for construction defects that result in property damage?

Typically, one begins analysis of statutory construction with the language of the statute itself, but Liberty Mutual suggests there may be cases where the most persuasive argument may be to start elsewhere:

The issue before us is whether Liberty Mutual’s complaint in subrogation falls exclusively within the Right to Repair Act, and therefore is time-barred. We start with a brief history of the Act and identification of the problem it was intended to address. Normally, we would begin by analyzing the language of the statute. In this case, however, the language of the statute can be best considered with an understanding of the Act‟s impetus and purpose.

(Emphasis added, footnote omitted.)

Here, what made the legislative history such an attractive starting point for the appellant and the court was that the intent to overturn case law was explicitly stated in a committee report on the bill. From there, it was easy to explain the limited intent of the statute and prevent a broader application that would require dismissal of the appellant’s complaint. The judgment of dismissal was reversed.

Lesson learned: just because there are particular analytical rules that usually apply, don’t feel hidebound.

Even disobedience of trial courts in other states can get your California appeal dismissed

Last Thursday’s decision in Stoltenberg v. Ampton Investments Inc., case no. B235731 (2d. Dist. April 4, 2013) demonstrates the hazards of being unable to stay enforcement of a money judgment against you while your appeal is pending . . . and how much trouble you can get in for going too far in resisting those enforcement efforts. How much trouble? Well, is having your appeal dismissed enough trouble for ya?

Ampton had the misfortune of losing at trial and having a judgment of more than $8 million dollars entered against it. Ampton appealed, but did not post a bond to stay enforcement of the judgment. When the plaintiffs registered the California judgment in Ampton’s home state of New York and then subpoenaed financial records, Ampton ignored the subpoena. Plaintiffs asked the New York trial court to find Ampton in contempt. Ampton escaped contempt but was ordered to respond to the subpoena. When Ampton refused to do so, Plaintiffs again sought a contempt finding against Ampton, and that time they got it: Ampton was ordered to pay $500 in sanctions and to comply with the subpoena within 30 days or face further sanctions.

By now, you would think that Ampton might finally accept the reality that its own failure to stay enforcement of the judgment pending appeal carries consequences that it would have to live with, and comply with the contempt order. But . . . that’s not what Ampton did. When Ampton failed to comply with the New York contempt order, Plaintiffs moved to dismiss Ampton’s California appeal, arguing that Ampton’s disobedience of the New York trial court contempt order was sufficient to invoke the “disentitlement doctrine.” After much procedural wrangling (which makes for interesting reading but is unnecessary to cover here), Plaintiffs succeeded in getting Ampton’s appeal dismissed.

Let’s start with the court’s description of the disentitlement doctrine (citations omitted):

An appellate court has the inherent power, under the “disentitlement doctrine,” to dismiss an appeal by a party that refuses to comply with a lower court order. As the Supreme Court observed . . . “A party to an action cannot, with right or reason, ask the aid and assistance of a court in hearing his demands while he stands in an attitude of contempt to legal orders and processes of the courts of this state.

We recently explained the equitable rationale underlying the doctrine. “‘Dismissal is not “a penalty imposed as a punishment for criminal contempt. It is an exercise of a state court‟s inherent power to use its processes to induce compliance” with a presumptively valid order’ . . .  Appellate disentitlement “is not a jurisdictional doctrine, but a discretionary tool that may be applied when the balance of the equitable concerns make it a proper sanction . . . . “No formal judgment of contempt is required; an appellate court “may dismiss an appeal where there has been willful disobedience or obstructive tactics.” The doctrine “is based upon fundamental equity and is not to be frustrated by technicalities.”

The Court of Appeal has no problem finding the doctrine applicable here. After rejecting a few contentions that were squarely against precedent (why the heck were those arguments made?), the court addresses the one issue that had even a chance of succeeding: that Ampton’s appeal could not be dismissed under the disentitlement doctrine because Ampton disobeyed orders only of a court of foreign jurisdiction rather than orders from a California trial court.

It’s a valiant effort, but the Court of Appeal finds no reason to treat disobedience of foreign court orders any differently from those of California trial court for purposes of the disentitlement doctrine. The court first cites the “full faith and credit” clause of the federal constitution, but also notes a very practical reason for applying the disentitlement doctrine in these circumstances (citations and footnote omitted):

Had plaintiffs attempted to enforce the judgment in California by propounding postjudgment special interrogatories seeking defendants’ financial information, including information about assets defendants may have in New York, the disentitlement doctrine would have applied to any noncompliance with the California trial court‟s orders compelling responses to those interrogatories.  For purposes of the disentitlement doctrine, there is no meaningful distinction between New York trial court orders and California trial court orders related to enforcement of a California judgment. The orders of the New York court in issue were based solely on a California money judgment and were intended to aid in the enforcement of that judgment. Thus, by violating those orders, defendants are obstructing and frustrating the enforcement of a judgment of this state, while at the same time seeking relief concerned that judgment in this court. Under the well-established disentitlement doctrine, defendants are not entitled to the relief they seek on appeal.

UPDATE: Interestingly, the court stayed its dismissal for 30 days to allow Ampton to seek reinstatement of the appeal, but cautioning that it was not suggesting or implying how it would act on such a request.  So, naturally, Ampton did so, but only at the last minute and not very well. Ampton filed an initial motion that provided only an unsworn account of Ampton’s purported compliance with the New York Subpoena, a “supplement” to that motion regarding further New York proceedings, a petition for rehearing and a “renewed” motion for reinstatement (this time supported by sworn declarations),  and finally a “supplement” to the renewed motion, with a flurry of orders from the New York court, all for naught. The Court of Appeal found that Ampton failed to prove that it had ceased playing games:

Defendants have had two months since our initial opinion to provide us with a competent and unequivocal showing that they had complied fully with plaintiffs’ information subpoena and that the New York court had made an express finding of full compliance. Defendants and plaintiffs have both provided their versions of the oral proceedings before the court, but apparently those proceedings were “off the record.” Had the New York trial court, knowing of our deadline, considered our dismissal order inequitable, that court presumably would have acted upon the pending motions before it with respect to compliance with its orders. Moreover, it was defendants’ burden to provide us with an adequate record, and that would include a transcript of a proceeding “on the record” or a reasonable substitute for such a transcript. (See Cal. Rules of Court, rule 8.137.) Defendants have been making last-minute efforts to avoid the disentitlement doctrine, but these efforts are too little and too late.

If you are unable to stay the judgment pending appeal, use every legitimate means at your disposal to forestall enforcement (the requirements for many judgment enforcement proceedings are highly technical, and noncompliance by the judgment creditor can delay things for a while), or try to settle the case (though admittedly, an appeal without a stay of the judgment does not create a lot of leverage), but don’t play games with judgment enforcement. The best appellate argument in the world is worthless if the Court of Appeal dismisses your appeal under the disentitlement doctrine before it ever reaches the merits.