You trial attorneys have a job to do. That job is to win the trial. And you can’t always do that and win the appeal at the same time. So you can’t pick a fight on every point. But, you had better fight the ones that turn the case.
And, you had better make a record on it.
On this episode of the California Appellate Law Podcast, reprising Tim’s recent CLE presentation, we cover 10 tips that appellate attorneys want every trial attorney to know:
The rule that contains all appellate rules: Make the Record.
#1 Make sure your theories of the case are captured in your pleadings
#2 Was key evidence excluded? Preserve the issue by making a proffer.
#3 Keep objecting to evidence if the judge “defers” ruling on your MIL.
#4 Object to Jury Instructions
#5 Review the Verdict for Inconsistences
#6 Request and Object to the Statement of Decision
#7 File a motion for new trial to preserve challenges to the damages amount …and Watch out for JNOVs!
#8 Calculate Appellate Deadlines Correctly
#9 Avoid Common Appellate Briefing Mistakes
#10 Advise your client about important post-judgment issues (Attorney fees and costs; SLAPP fees; Bonds and Stays of Judgment-Enforcement; Post-judgment interest)
Evergreen Tip: Get a Court Reporter!
Appellate Specialist Jeff Lewis' biography, LinkedIn profile, and Twitter feed.
Appellate Specialist Tim Kowal's biography, LinkedIn profile, Twitter feed, and YouTube page.
Sign up for Not To Be Published, Tim Kowal’s weekly legal update, or view his blog of recent cases.
Use this link to get a 25% lifetime discount on Casetext.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
After getting hit with an anti-SLAPP fee award, the plaintiff in McKenna v. Sony Pictures Entertainment, Inc. (D2d5 Feb. 15, 2023 No. B304256) 2023 WL 2007687 (nonpub. opn.) filed a notice of appeal. McKenna had already filed the order granting Sony’s anti-SLAPP motion based on alleged misappropriation of the likeness of the late actor Christopher Jones in the Quentin Tarantino Film Once Upon a Time … in Hollywood.
To file the notice of appeal, the attorney logged on to the e-filing system late in the evening of the appellate deadline. Like, really late—at 11:52 p.m. Owing to a reportedly “slow connection,” the notice of appeal was not file-stamped until 12:00 a.m. That is, the day after the deadline.
One minute late.
The plaintiff also had a second problem: the notice of appeal did not identify the order being challenged on appeal, or the name of the appellant, and so the clerk rejected the notice of appeal for that reason. So the morning after the deadline, the plaintiff filed a motion to amend the notice of appeal to correct those errors. The plaintiff also explained the e-filing problems.
But the Court of Appeal still dismissed the appeal.
As discussed in another recent case in Garg v. Garg (D4d3 Sept. 7, 2022 No. G061500) --- Cal.Rptr.3d ---- 2022 WL 4092828), California Rule of Court Rule 8.77(d) may support extending the deadline to appeal where a technical problem prevented a timely filing. Rule 8.77(d) provides that “[i]f a filer fails to meet a filing deadline … because of a failure at any point in the electronic transmission and receipt of a document the filer may file the document on paper or electronically as soon thereafter as practicable and accompany the filing with a motion to accept the document as timely filed….”
In Garg, the Fourth District compared rule 8.77(d) to a similar but narrower rule at rule 2.259(c). The narrower rule appears to apply only when “technical problems with the court's electronic filing system prevents the clerks from accepting the document for filing.” Relief under rule 2.259(c) should be directed to trial courts.
But rule 8.77(d), Garg continued, “appears to be broader than rule 2.259(c)” because it allows for relief based on a “failure at any point in the electronic transmission and receipt of a document” (not just a “technical problem with a court's electronic filing system” as under rule 2.259(c)). Relief under rule 8.77(d) should be directed to the Court of Appeal.
Garg would have afforded relief to the appellant, except that the appellant did not request relief immediately. Instead, the appellant there waited 29 days. That was too late.
Here in McKenna, the plaintiff sought relief immediately, explaining that the attorney logged on sometime between 11:49 and 11:52 p.m., but that a “slow connection” prevented the filing from being received until 12:00 a.m.
But unlike the Fourth District in Garg, the Second District in McKenna read rule 8.77(d) more narrowly. McKenna held that a “slow connection” does not warrant relief under rule 8.77(d). “[W]e do not believe a “slow connection” resulting in a delay of a few minutes between the submission of an electronically-filed document and its receipt by the court is a “failure ... in the electronic transmission” as contemplated by Rule 8.77(d).”
This appears to be a difference in the way the Second and Fourth Districts read rule 8.77, with the former reading it more narrowly.
Even if the notice of appeal had been timely, the court said that “[j]ust as important” was the fact that the notice of appeal also failed to specify the order being appealed from, as well as the identity of the appellant. Those deficiencies also made the notice of appeal “insufficient to invoke this court’s jurisdiction.”
Comment: I found this surprising given that the Second District recently excused a similarly deficient notice of appeal in Magyar v. Kaiser Permanente Medical Center (D2d2 Jan. 23, 2023 No. B315353) 2023 WL 355173 (nonpub. opn.), covered here. There, the appellant appealed from one summary judgment, but not a second summary judgment (as to a second defendant). After reading McKenna, one out assume the appeal must be dismissed. But that was not the outcome in Magyar. To the contrary, the Magyar court said just the opposite, and emphatically: there was “nothing that would logically and conclusively demonstrate plaintiffs intended to appeal solely from one of the judgments.”
There was nothing here that would suggest the plaintiff intended to appeal from any other order than the anti-SLAPP fee order. Yet unlike Magyar, the court did not invoke the liberality doctrine to save the appeal.
So when it comes to invoking the rules that might relax the deadline to appeal, your mileage may vary. Do not count on them.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
“I know the sting of a loss as well as anyone,” says Justice Laurie Zelon, but if the course of the case is really not going to change, writ relief is highly unlikely.
If the issue is going to be dispositive of the case so that the case would have to be retried, however, that is a good candidate for a writ. “The court does understand that the last thing you want to have happen is to have a case get fully tried and then retried.”
Watch the clip here.
This is a clip from episode 48 of the California Appellate Law Podcast. Listen to the full episode here.
Tim Kowal helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes a newsletter of appellate tips for trial attorneys at www.tvalaw.com/articles. His appellate practice covers all of California's appellate districts and throughout the Ninth Circuit, with appellate attorneys in offices in Orange County and Monterey County. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
This will probably never happen to you, but in case your appeal is dismissed and you are late in filing your motion to vacate the dismissal to reinstate the appeal, consider asking the Court of Appeal for a favor like in Sidney v. Riley. The Court of Appeal asked the Supreme Court to grant review and transfer the case back.
In Sidney, the appellant’s opening brief got kicked for defects, and the appellant failed to refile on time. So the court dismissed the appeal. The court can vacate a dismissal and reinstate the appeal, but only so long as it retains jurisdiction. After 30 days, the Court of Appeal loses jurisdiction. Here, the docket indicates the motion was filed "[o]n November 15, 2022, at 12:52 a.m., a day after this court's jurisdiction ended."
But even though it no longer had jurisdiction, the court still did the appellant a favor. Division 2 asked the Supreme Court to grant review on its own motion and transfer the case back, "to allow this court to act on appellant's motion."
And the Supreme Court obliged.
Thanks to David Ettinger for this tip.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
So you think you know how to determine the deadline to file your notice of appeal? You can test your abilities using the facts of Castillo v. McCreary (D2d3 Feb. 21, 2023 No. B317493) 2023 WL 2131341 (nonpub. opn.).
On September 3, 2021, the trial court entered a minute order imposing discovery sanctions against the defendant’s attorney totaling $6,577. That is more than $5,000, so it is appealable. (Code Civ. Proc., § 904.1(a)(12).)
The minute order was not file-endorsed. But it attached a certificate of mailing, which was filed-endorsed.
The default deadline to take an appeal is 180 days. (Cal. Rules of Ct., rule 8.104(a)(1)(C).) But a file-endorsed order showing the date it was served triggers the 60-day deadline to appeal. (Cal. Rules of Ct., rule 8.104(a)(1)(A).)
So was a non-stamped order attaching a stamped certificate of mailing a triggering document under rule 8.104?
Close call, but no, held Castillo. Under Alan v. American Honda Motor Co., Inc. (2007) 40 Cal.4th 894, the court may treat the order and certificate of mailing as the same document, for purposes of complying with the part of the rule that requires the order the show the date of mailing. But are they the same document such that a file-stamp on the certificate constitutes a file-stamp on the order? “[W]e are not aware of any courts to have taken that approach and we decline do so here.”
“Here, the trial court's minute order is not “truly” filed-endorsed.”
The court went on to reverse the sanctions against the attorney, because Code of Civil Procedure section 2025.450(g)(1) did not authorize sanctions against the attorney of a client who failed to appear for deposition.
Thanks to Marc Alexander for originally reporting on this case.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
For attorneys, the best referral is a referral from another attorney. But before you refer to another attorney, beware of the ethical traps. Kristi Thomas, a labor and employment attorney who also focuses on ethical issue, warns in a recent article that incautious referrals can lead to a conflict of interest, or an improper referral fee, or even liability for making a negligent referral.
Kristi discusses these traps, and offers some tips how to avoid them:
👉 Given multiple names when making a referral, not just one. (Especially if you have a referral-fee arrangement with one of them.)
👉 Don’t vouch for your colleagues. That doesn’t mean you can’t say anything about them, but instruct potential clients to do their own research.
👉 Control the conversation with the potential client to avoid eliciting confidential information and creating conflicts—don’t let them “vent.”
👉 Send non-engagement letters, confirming no attorney-client relationship has been formed.
👉 Check your malpractice policy to see if it covers negligent referrals—not all of them do.
Kristi Thomas’s biography and LinkedIn profile.
Appellate Specialist Jeff Lewis' biography, LinkedIn profile, and Twitter feed.
Appellate Specialist Tim Kowal's biography, LinkedIn profile, Twitter feed, and YouTube page.
Sign up for Tim Kowal’s Weekly Legal Update, or view his blog of recent cases.
Use this link to get a 25% lifetime discount on Casetext.
Announcer 0:03
Welcome to the California appellate podcast, a discussion of timely trial tips and the latest cases and news coming from the California Court of Appeal and the California Supreme Court. And now your hosts, Tim Cole and Jeff Lewis.
Kristi Thomas 0:17
Welcome, everyone. I am Jeff
Tim Kowal 0:18
Lewis. And I'm Jim Hall. Both Jeff and I are certified appellate specialists and uncertified podcast co host. Each episode we tried to bring our audience of trial and appellate attorneys some legal insights and news they can use in their practice. If you find this podcast helpful, please recommend it to a colleague.
Kristi Thomas 0:34
And a quick thank you to our podcast sponsor case text. Keys text is a legal research tool that harnesses AI and a lightning fast interface to help lawyers find case authority fast. I've been a subscriber since 2019, and I highly endorse their service and listeners of our podcasts will receive a 25% lifetime discount available to them if they sign up at case text.com/cal. That's case text.com/ca, l p,
Tim Kowal 0:57
and Jeff today we're pleased to welcome Christy Thomas to the show to talk about her recently published article about the legal and ethical traps to avoid when referring a client to another attorney Christy Thomas is a labor and employment attorney with Sheppard Mullin. She is also actively involved in the firm's pro bono practice. Christy's practice involves representing employers and the defense of complaints for class action and single plaintiff matters. Chris he also provides counseling and training to employers on issues like Wage and Hour disability and family and medical leave discipline and termination and sexual harassment and workplace behavior. Christy began her legal career in Philadelphia in 2008, before becoming a member of the California Bar in 2011. Christy, welcome to the podcast.
Kristi Thomas 1:43
Thank you guys so much for having me. Very happy to be here.
Tim Kowal 1:48
Yes. terrific to have you. Now, I read a very brief version of your bio. Is there anything that I missed or something anything you'd like to talk about to kind of introduce yourself to our audience?
Kristi Thomas 1:56
Yeah, you know, the bio does a great job at covering my my legal practice and my experience, but it doesn't really talk about what I like to do outside of work. So just just a few things to get to know me better. Beach gal. I love outdoor activities, mainly because I grew up back east in the cold. So I now like biking and running outside and hiking. In fact, my husband and I just hiked the most active volcano in Guatemala about a month ago. It's called Picasa. Very fun, but also very challenging. I golf just about every weekend, and I just got a new puppy. So super excited about that. No, that's
Tim Kowal 2:39
terrific. Yeah, I was just I was just telling Christy offline that I took the family to Lego Land. for the weekend. We came back early because the kids were worried about their new kittens. They hadn't been away from their new kittens. So Chris, he's got a new puppy. My kids got new kittens. That's her always a fun challenge to have in the house. Well, Christy, you mentioned being from the cold back east in Philadelphia, what brought you out here and what and what brought you into labor and employment? Were you in labor and employment when you were practicing in Philadelphia as well, so
Kristi Thomas 3:08
I wasn't. So I actually started off more as a general practitioner, and I handled, you know, a wide array of legal issues. But I remember getting my first employment law case, and I was representing the employer. And I remember opposing counsel, really trying to make my client look like the Big Bad Company, right. And I just kept thinking, look, this employer is doing the best that they can, given the many employment laws that they have to navigate. And now that I'm in California, especially the many employment laws here, and I just remember thinking, you know, they're trying to do everything right for their clients, maybe or their employees. I'm sorry, maybe they just need a little bit of help or guidance in doing so. And the case really appealed to me. And I decided to start specializing in employment law.
Tim Kowal 4:00
Yeah. And are your cases usually in state court or federal court or arbitration? I know there's a lot of employment matters that that go to arbitration.
Kristi Thomas 4:10
Yeah, so I haven't mixed most of mine are in state court or arbitration. And the reason we're seeing so many in arbitration is because employers nowadays have valid binding arbitration agreements with their employees. So we often move to compel the matter to arbitration. The cases that I have that have stayed in state court, the named plaintiff hasn't signed an arbitration agreement. So we're sort of stuck there. And then I do have a handful right now that are in federal court, and those typically started off in state court as class actions, but the same type of thing the named plaintiff, the representative did not sign an arbitration agreement. There is no class action waiver. And so unfortunately, the class action remains, we can't go to arbitration. So what do we typically do? We try to remove the case to federal court under something called the class action Fairness Act. But a lot of my cases are in arbitration right now,
Tim Kowal 5:10
what stands out in your mind? I know, as attorneys, we and a lot of our listeners know some of the basic differences between state and federal court and arbitration. What are some things that stand out in your mind as distinct advantages of one forum over another, in particular, for your area of practice in labor and employment?
Kristi Thomas 5:27
Yes, let me talk a little bit about arbitration since so many of my cases are in that venue. I think any venue has pros and cons. Tim, but arbitration, I mean, we tend to like arbitration for our clients, because there's limited discovery involved, okay, usually moves along on a faster track than a case that's in court. There's usually some aspect of confidentiality to the proceeding, which the company or the employer likes. And then the big thing, the most important thing is that the case is not being tried by a jury, right? We have a neutral or there's supposed to be a neutral arbitrator hearing the case. So there was the pros. And then you know, in terms of cons disadvantages, I would say, for employers in California anyway, employers do have to pay the arbitrators fee, and sometimes that can get a little high. But, you know, pros compared to the cons, I think the pros outweigh the cons for arbitration.
And the biggest con, you'd have to say, is the lack of an appellate remedy and a lack of a role for appellate counsel in any arbitration. Right.
Right. Right.
Tim Kowal 6:38
Yeah, very, very limited in terms of appellate remedies when you're in arbitration, it's not good for our business, Jeff.
Kristi Thomas 6:44
Yeah, I do have to ask, you know, while we're on the subject, do you ever do I see, sometimes the AAA or JAMS offers unlimited arbitration appellate remedy where you have an appeal from the arbitration within the Jam's or AAA structure. Have you ever participated in one of those or No,
I have not. No, I have it. Interesting.
Tim Kowal 7:03
All right. Christy, let me ask you this, what do you think that clients or opposing counsel would say is unique about your legal practice? Now your labor and employment attorney representing employers, what do you think makes you unique about the cases that you take on or the way that you practice?
Kristi Thomas 7:20
So I think my clients would say, my ability to offer full service in all things employment law, right. So some employment attorneys only do litigation, some employment attorneys only do workplace investigations, others only do counseling, I do it all. So I not only litigate, but I'm on the phone with my clients, sometimes on a daily basis, advising them, counseling them on their policies, practices, procedures, daily workplace issues that they're dealing with, in order to try to avoid lawsuits. And then on top of that, I go out and perform trainings for the managers, the supervisors, and the employees at these various companies, at our clients. So I would say I would say, Yeah, my ability to really offer full service.
Tim Kowal 8:14
Yeah, that seems somewhat rare and, and difficult to do to be able to offer that soup to nuts, doing the advisory services and counseling services, pre litigation in hopes that the employer will never have to be involved in litigation, but with the realization that probably sooner or later, you will, will have to be you will face a lawsuit from a former or current employee.
Kristi Thomas 8:33
Sooner or later in California, it's bound to happen. Right?
Tim Kowal 8:36
Christie? Do you have any good war stories, litigation stories that you'd like to share litigation mistakes, maybe that you've seen someone make that are just indelible, that you'll never forget, you'll always avoid making in your practice?
Kristi Thomas 8:49
Yeah, I'm sure we've all seen just a ton of stuff. But one thing that comes to mind, and it seems pretty simple and straightforward, but make sure you're reviewing the items you turn over in litigation or to opposing counsel, before you turn them over. I had a case once I was representing the employer, and the employee had taken or my client thought they had taken a lot of confidential information, customer lists, stuff like that. And then they weren't went to work for another employer. And the thought was that they were using our clients confidential information at their new employer. So I obviously subpoenaed the records from that other employer and the other employer was represented, by the way, but when I got the records in, I mean, I just asked myself, I'm like, did the other lawyer really even look this stuff because there was no fight put up, you know, the stuff was just sort of handed over. And it was very, very helpful to me. So I think the lesson is just always, always review things you're turning over in litigation, even if it's just to be prepared and see what It's coming down the pipeline,
Tim Kowal 10:01
you don't want the first time you see a document you produce to be in a filing by your opponent.
Kristi Thomas 10:07
Absolutely not.
Tim Kowal 10:10
Okay, last question before we dive into your article about the ethical pitfalls in referring clients, Christie, what is your favorite part of your practice? You do it all in labor and employment from consulting and advisory services to the litigation itself? What do you like the best,
Kristi Thomas 10:25
I like that it never gets boring. And I say that because the California employment laws, the regulations, the rolls, they're constantly changing, guys. I mean, every year I'm having to get up to speed on new employment laws that have been passed. I'm having to discuss them with my clients. And we're having to determine how to tackle all of these new requirements. Okay, the best example and the most recent example, I think, that I can give are all of the COVID 19 related laws and regulations. At one point, it seemed like Cal OSHA was changing the rules as they apply to employers on a monthly basis. And so you really got to be on top of that stuff. You have to know that stuff. So there's never a dull moment when it comes to California Employment Law.
Tim Kowal 11:17
Okay, Christie, let's talk about the article that you published in the Orange County Lawyer magazine back in August 2022. It's titled, avoiding pitfalls when making a referral to another lawyer. So let's talk about some of the ways that an attorney can avoid becoming incurring liability in the process of making referrals. And the first one that jumped out at me, it's frankly, one that I had not given enough thought to is the potential liability for making a negligent referral. That was one trap I was aware of another trap I want learn more about was about referral fees, which was another one that you talked about, but negligent referrals. Christie, so let's say you refer a client to another attorney and that attorney screwed up, can you really as the referring attorney, be made liable for making a negligent referral?
Kristi Thomas 12:04
So the short answer there is, yes, you can. But I think there's a distinction to be made here between legal malpractice claims on the one hand, okay, and general negligence claims. On the other hand, for a legal malpractice claim, the person needs to be your client. Okay, and I'm sure we'll talk about this in a little bit, how to avoid forming an attorney client relationship with a prospective client. But for a legal malpractice claim, the person needs to be your client, when you're acting and we all know this, when you're acting as somebody's lawyer, you have a fiduciary duty to that person, okay. It's probably a heightened standard of care that you owe them, I would be willing to bet that that if you were sued for legal malpractice, somebody could probably persuade a judge to include a heightened standard of care language in the jury instruction. Okay. But that's legal malpractice. Switching gears to general negligence. That's a much lesser standard. I mean, let's think about those elements from law school, right? There's just four of them. You need duty, breach, causation, and damages. Okay? Really, anyone can be sued for general negligence. You don't have to have just your client sue you for for negligence that can be a prospective client, who can sue you for general negligence? And so the question becomes, how do we avoid a lawsuit that's related to a negligent referral, and there are a few things that you can do to keep in mind. So when you are talking with a prospective client, and you're referring them, number one, you want to give them the names of several attorneys, okay, don't just give them the name of one lawyer, provide them with several names. Number two, you want to say that you can't vouch for these other attorneys. Okay, this is not an endorsement by you. Yes, you're providing them with some names, but you're not vouching for them. Number three, suggests that the person actually conduct their own research, including interviewing these other attorneys to see if they're going to be appropriate for their case. Okay, that's number three. And then the last one, and this is especially important, if you have a prospective client who was going down the path of thinking that they are your client, put something in writing. You can obviously word it in a diplomatic way. But say something to the effect of I'm not your attorney. I mean, maybe you even send out like a non engagement letter saying something to the effect of, you know, as you know, we've had to decline representation. Okay, there's nothing better than having that in writing. All right. And then And one other thing I do want to mention on this, and I think it's worth mentioning, there is one exception to the idea that only your client can sue you for legal malpractice. And that exception comes into play when we're dealing with intended beneficiaries. And I think this is worth mentioning, okay. And the best example, the number one example I can think of there involves beneficiaries to a trust. So let's say that you are a trust attorney, and you're preparing a trust, and you make some sort of mistake, okay, an error, you miss a roll, I don't know what it is, but you mess up. All right, and the trust store ends up dying. Well, the trust store obviously can't sue you, maybe his or her estate can but he or she can't. But think about it. I mean, who's really going to damage in that situation? It's the beneficiaries. And you may say, Well, I prepare this trust and these beneficiaries were not even born yet. There's no way they can sue me know, if there are expressor intended beneficiaries, they can sue for legal malpractice. And the other interesting rub there is that, you know, not only can trust work really opened the door or expand the class of people who can sue you for legal malpractice. But there's also a statute of limitations issue. So the statute of limitations on legal malpractice claims in California is one year. And so again, you might be thinking, great, awesome, that's going to come and go, I'm not going to get sued. But the thing is, the statute of limitations does not start to run until an actual injury occurs. So that's usually some specific event. Usually, it's the wealthy trust or dying, right? So you can prepare this trust. And then 20 years later, you're sued. I mean, for legal malpractice, it can happen. Okay. But yeah, setting that aside, prospective client, how to avoid the negligent referral, the names of more than one attorney say you can't vouch for them, tell them to conduct their own research, and really put something in writing. That's,
those are three really good tips. Let me ask you to back up one second, we're talking about the difference between suing someone for malpractice and the difference between a general negligence case and a lower standard of care or the lower burden of proof. You know, in a legal malpractice case, you always have to prove the case within a case that but for the malpractice, you would have won the underlying case, it's usually hard to prove that causation. Is there no equivalent requirements for negligent referral cases that you don't have to prove that but for the negligent referral, you would have won the prior case, etc?
That's a great question, Jeff, I'm not aware of that now,
makes it easy. Hey,
Tim Kowal 17:43
you wouldn't approve that. If you wouldn't have referred me to this derelict, I would have found this top notch attorney who would have won my case for me. Right, right.
Kristi Thomas 17:53
And then the other question I had isn't, don't provide me anything that's super secret or anything. But do larger firms like Sheppard Mullin, have policies regarding if a prospective client calls us and asks us for a referral? Do not give a referral? Or here's what you do if you're going to give a referral to they have expect policies and their procedures?
Well, I'm not aware of something formal in writing at large firms. I mean, maybe some large firms have them. But like, I think the biggest thing is whether there's going to be a client relations issue possibly, right, because if a prospective client calls you and they want a referral, and it turns out that you maybe your firm already represents someone adverse to them. I mean, you can my understanding is you can make the referral for the prospective client. I'm not aware of California law saying you can't In fact, there are cases in New York and District of Columbia that say you can make the referral. But from a client relations standpoint, are you going to want the other client at the firm or the partner handling their case to be calling you up and saying, Why did you refer this person out to somebody who's now suing my client? Right? You got to make that decision? I think on a case by case basis,
Tim Kowal 19:06
is there any room for avoiding liability? Let's go back to the your three tip. To avoid this pitfall of liability for negligent referrals you suggested, give multiple names. Rather than just giving the prospective client just one name, which could lend the suggestion that this is your go to this is the person who's going to serve you best give multiple names, don't vouch for any one of them, and instruct the potential client to do their own research and send out a non engagement letter. Is there any way to avoid or limit liability by if it's your legal assistant giving out the name rather than the attorney personally?
Kristi Thomas 19:41
So that's a great question too. I think a lot of firms and a lot of firms for the intake process. They do have a paralegal or some sort of intake specialist handling this right, not the attorney. And so the paralegal or intake specialists may be great, they're probably well trained. They're probably better at During the onboarding, then the attorney but what I would think of putting in place is some sort of policy that says the onboarding process is not complete or the intake process is not complete until x, y, w, x, y, z have occurred, right. That way, the intake specialists and the paralegals know really what needs to be done. And then maybe there is maybe you do have a battery or a list of people like if you do personal injury, you can't take it, you have a list of people that you refer to and the paralegal or the intake specialist can give the person that. So I think that would be helpful.
Tim Kowal 20:39
Yes. If you're just kind of sending out instead of the attorney personally saying, you should really talk to Christie Thomas about this. You could have your legal secretary saying, Here's a list of some of the attorneys that we know of who practice and labor and employment law Christy Thomas Jane Doe and John Smith than that suggested this is just a standard list. No one of them is being vouched for or referred as a specialist in your particular case.
Kristi Thomas 21:01
I think that would be helpful. Yeah.
Tim Kowal 21:04
And I think Jeff, you know, thinking back our episodes about using legal tech, I'm getting some ideas for some text expanders to put in emails. I'm not your client. I'm not your attorney. This is legal advice. And I don't vouch for any of these attorneys that I'm whose names I'm giving you.
Jeff Lewis 21:19
Yeah, yeah.
Tim Kowal 21:21
Okay, Christy, let's go back to your something else. You said in your article avoiding pitfalls. When making a referral to another lawyer in Orange County Lawyer magazine, you said something in that article I wanted to ask you about because it was just a great line that stood out to me. When making a referral. Obviously, you want to refer, you know, you want to be able to refer to someone who's going to be a winner we talked about you shouldn't vouch for that person, don't make any guarantees or representations. But you want to have a good feeling about this person. Obviously, if you're going to refer a potential client to them, you cautioned that meant a long list of victories on this refer ease the attorney that referring to you might look on their website, and it'll show a long list of victories. But that doesn't always mean that the attorney is any good you point out because you say in your article that quote, someone with a long history of well publicized victories might not promptly return client phone calls, or may be abrupt or even rude when doing so and quote. And then here's the line that stood out to me you say, quote, they may be a lion in the courtroom, but a dud in the library and quote, I wanted to ask you what you meant by that. A lion in the courtroom, but a dud in the library.
Kristi Thomas 22:25
Yeah, I'm glad you guys asked this question. So we could flush this out a little bit. Okay, so what do I mean aligned in the courtroom and died in the library? What I mean is, yes, we are all attorneys, right. But we're also all human. So some of us are very good or excel in one area. And maybe we don't excel as much in another area. So maybe the best way to think about this, maybe we've seen this with some of our colleagues that this is a way to describe it. So you have one colleague who is very good at presenting, but they're not as good at negotiating. Or you have one colleague who's very good at research, but they're not as good at writing. Okay, I'm not saying that they're a bad attorney at all. I'm not saying that. I'm just saying they tend to excel in one area over another. So when you're referring someone, the prospective client, you don't want to say to them, Look, I have the best attorney for you. This is the best. Okay, what does best attorney even mean? How is that defined? Okay. Instead, what you should be asking yourself, What am I looking for in the person I'm referring to, in the context of this issue or case, because maybe you don't need the line in the courtroom, maybe this looks like it's going to be a small case, it's going to resolve fairly quickly, you don't need the lion. Or maybe you see that this might be a super high profile case, very contentious, it's going to go to trial, and you know, and stellar trial attorney to refer them to, but you also know that that attorney sends out very, very heavy bills, are the heavy bills gonna matter in that situation? Maybe not. And then I'll just give you a third example. Let's say you have a prospective client who has called you 10 times within 24 hours, despite you, you know, talking to them each time and saying, I'm gathering some names for you to refer you to, and you have attorneys in mind, but you know, that two of those attorneys are very, very bad at promptly returning client calls. Maybe this is not the person to refer to them. Okay. So whenever you're referring, you just want to think about what am I looking for in the person I'm referring to in the context of this issue or case?
Right, right. Yeah. Jose, interesting, you know, also The cases, sometimes you have somebody who's alive yesterday, but today and tomorrow might not be alive. And I wonder if Tom gerar gotten any referrals in the waning years of his practice whether any of the referring lawyers there are facing negligent referral lawsuits?
Tim Kowal 25:14
Oh, my goodness.
Kristi Thomas 25:16
Yeah. Sorry, Tim,
Tim Kowal 25:18
go ahead. Well, no, that's right, the right attorney for every occasion. But it's interesting how these issues kind of bookend that, you know, it's important to find the attorney who has the right niche, not just any old labor and employment lawyer, you might be ready to go to trial next week. And you need like a last minute trial attorney who only does trials and they relish getting the file the night before the trial and working it up and going in there and cross examining witnesses. And then you have the other need are just, I want to avoid lawsuits, I want to be best positioned to defend myself in a lawsuit if I get them. So you want to be able to know the person you're, you're referring to the potential client so that you're giving them the best referral. But again, back to your first advice, you don't want to vouch for anybody and say that this is really the person who's going to serve you best for your situation, because again, you don't want to, you want to limit your exposure to liability for negligent referrals if that attorney doesn't wind up serving the potential client well. Okay, tell us about referring an existing client to another attorney, we've been kind of talking about, you get a phone call from somebody and you're turning down the representation or it's not your practice area, and you're referring it out to someone, someone else that you may know, because you want to help other colleagues maybe or you just happen to know someone that may help be able to help the potential client, but what about, are there different considerations, Christy, for existing clients, you have an ongoing relationship with the client, they have a need for something that you don't provide? And you're going to refer them outside yourself or your law firm? Do you have what duties do you have to your existing client? When you refer them out to another attorney? Do you have to research the attorney? How much do you have to know about the other attorney before you refer them to your existing client?
Kristi Thomas 26:58
I think it's a great question to ask your existing client how much they want you to do for them. Okay, so you may start off by saying, or you may initially say to them, Hey, do you just want my off the cuff thoughts on attorneys to refer you to? And they'll probably say, Yes, stop there. Or you say, Do you want me to conduct more research on these attorneys? Okay, some attorneys will even go out. And I can share this with you, Attorneys at my firm, have gone out of state to places where we don't have offices to sit down and meet with attorneys at other firms to see if they would be a good fit for existing clients. And they've actually charged the existing clients their whole rates in order to do that. So I think it depends on what the client wants. I also would probably bet that because it's an existing client, there is probably a heightened duty there when it comes to referrals. I mean, look, this is your client, maybe whether they're high paying clients or not, they're going to expect you to refer them to attorneys who are well equipped to handle these cases or these situations, but have an open line of communication with them and see how they want you to proceed.
Tim Kowal 28:17
Right. Yeah, I guess that's a good conversation to have before you start billing your client for doing that research, if that's not something that the client envisioned? Absolutely. Okay, let's review some basics that sometimes some of us might forget about avoiding the formation of an attorney client relationship during the referral process, volunteer that I could use a refresher on this. So when I pick up the phone with a potential new client for the first time, exactly, when does the attorney client relationship get formed? And what steps can I take to avoid forming that relationship before I'm ready for it?
Kristi Thomas 28:55
Yeah, so this is a tough one. So look, in a perfect world, in a perfect world, you should tell the prospective client not to divulge confidential information to you and only to give you enough of information that you need to run a conflict search. Okay, because what's the danger if the prospective client gives you too much information? Well, it's twofold. Okay, so number one, let's say that you've had the call with a prospective client, and you're running a conflict search. And oh, it comes up during the conflict search that another attorney at your firm is actually representing the party that's adverse to this prospective client. And then on top of that, oh, I just got a ton of information from this prospective client during my phone call with them. All right, the risk there is that the partner at your firm already representing the adverse party could be conflicted out and I can tell you he or she is not going to be here. Happy Abell. So that's number one. The second thing is that you form an attorney client relationship with a prospective client. So let me give you an example here to try to illustrate this. Let's say you're at a dinner party. Okay. And everyone's chatting small talk, and somebody says, Can you believe I got sued the other day? And you say, Oh, really? Well, I'm an attorney. What? What kind of case is it? What do you get sued for? And they say, a car accident, and you to get to talking throughout the evening, and the dinner party ends. You don't hear from this person until 28 days later, you get a phone call from her saying, Hey, are we going to respond to this complaint? It seems like we should probably do something here. What's the holdup? Right. So that person obviously thinks that you are her attorney. Now the standard for forming an attorney client relationship, or whether one has been formed is what would a reasonable person in the shoes of the prospective client had thought? What would a reasonable person in the shoes of the prospective client had thoughts? So the relationship is really in the eye of the beholder? And that Beholder here is the prospective client? Okay, so how do we avoid forming the attorney client relationship during your phone call? I mean, the biggest thing is don't onboard confidential information. If you're just kicking the tires around, and not divulging confidential information, there's no relationship. But in the real world, that's really, really tough, because maybe you're talking to this person for the first time, you haven't talked with them before, you're trying to obviously make a good impression, because they could be a potential client. They want to get things off their chest and tell their story. And you don't really know where to draw the line. So is it that they're just giving you their name, their adversaries name and the type of case? Oh, it's an employment law case sexual harassment claim? Or are they really getting into the details with you? Well, you know, in December, we conducted an investigation at the workplace, we interview these people, we determine, maybe employee X did harass employee, why? Oh, and by the way, we don't have a policy on this, we need your help in drafting a policy. Okay. It's really when they start getting into the details. Again, it's hard to know when to draw the line. But I would just tell them guys right up front in your conversation, don't divulge confidential information to me. And then the second big thing is try not to do or say anything that would make them reasonably believe a relationship has been formed. Tell them you're not their attorney, the biggest thing is communicating that there is no relationship. And I know I had mentioned earlier about putting something in writing, do it here. I mean, send them an email. Hi, so and so great. speaking with you today, you know, we're running a conflict search. But please continue not to divulge confidential information to me, an attorney client relationship has not yet been formed, or it has not been born, something like that. Does that make sense? Yeah, I
Tim Kowal 33:25
wonder if I can ask you just a couple of follow ups about that. Just because confidential information, you know, I'm going to put that in quotation marks you and I, as attorneys have an idea of what that means the potential client might not always know what that means. Same thing about or similar problem with saying that I'm not your attorney. If you say that at the end, we know that the attorney client relationship is formed. It's kind of a subjective standard, whether the client believes that an attorney client relationship is formed. So sometimes we announced that pablum that not your attorney, I'm not your attorney, I'm not your attorney. But if the client believes, well, I but I told you all this stuff. And I told you, I'm desperate for an attorney and you talk to me. And anyway, I wonder what if it might be a best practice during a phone call, say with a potential client to for the attorney to control the conversation and make sure that the attorney is asking questions. And you know, make sure that kind of like conducting a deposition, don't let the client or potential client go off on a narrative explanation, because you're gonna wind up getting all the the inside information about the case.
Kristi Thomas 34:24
Yeah, I completely agree with that. Look, they want to vent right, they want somebody to tell their story to so when it might make sense to do and this goes along with the intake policy that I had referenced before. But maybe you have at the firm some sort of policy or questions that are to be asked of the prospective client, just keeping it very basic, you know, what is your name? Okay, what company do you work at? What's the name of the party suing you give us that information? What type of case is it what you know, what are the claims in the complaint, you know, something like that, and Just leave it very basic. I completely agree.
Tim Kowal 35:03
It's probably a best practice, we attorneys figure that we like to have our assistants and paralegals take down the initial intake information, because obviously, it saves our time. But I think that's probably also a good firewall to make sure that, that we're not conflicting ourselves out because the that intake person knows, just to ask this, these types of questions, and the potential client probably knows not to don't bother giving a narrative explanation of the case, because this is only person, only a person who's filling in blanks on an intake form.
Kristi Thomas 35:31
Mm hmm. Yeah. I mean, sometimes there's a lot to be done before the intake process is actually complete, right, and they become your clients. So some firms I know, check the person's credit worthiness, some firms do a background check, you obviously need an engagement letter signed, maybe you need a retainer agreement, right. So it's best to probably indicate look, until we get all this stuff ironed out, is there there may be quite a few things. There's no attorney client relationship yet?
Tim Kowal 36:00
Yeah. Yeah, the trouble for me personally, is I am an exception for I don't make referrals from other colleagues go through my intake person will usually take their call directly. And now I'm going to be more wary that I could get into trouble there. Because, you know, suddenly, they've got an attorney on the phone, and they want to vent, they want to divulge all the confidential information about their case, because they might think that a trusted person already vouch for you. So you're my guy, I'm gonna give it all to you right now. So you have to be very defensive in your initial phone call with a potential client? Yes, I want to ask you something else. This is kind of off off the cuff. But it's specific to Jeff and my practice as appellate attorneys, a lot of the time, we will consult directly with the trial attorney. And I wonder if that sparks any ideas for you about potential ethical issues, or opening up liability for to the client. Sometimes in my relationship, I might not even speak directly with the client. I'm just more or less a consultant for the trial attorney. But my understanding is that I'm still I'm still an attorney, and the ultimate client is still the client, even if I am relating indirectly with the client through the trial attorney. I wonder if that raises any potential issues there. If I'm taking direction from the trial attorney, at what point do I have to go to the client for something if let's say that I detect a potential malpractice issue, for example, that could get very sticky, I imagine.
Kristi Thomas 37:22
Yeah. Oh, my gosh, yeah. That's a good question. And definitely a tough area, and it can get sticky. So I, I mean, thinking just offhand right now for appellate lawyers in particular, I don't know of issues that can come up offhand. If I think of any, I will reach out to
Christy. I know most of your works in arbitration. But if you take nothing away from this podcast, take this away, always ask for a statement decision, and always bring a court reporter to a big hearing. And if you don't do those things, or if you're an appellate lawyer, you've discovered the trial lawyer has not done those things. That's an uncomfortable conversation that an appellate lawyer has to have with the client about those topics.
That's a great point. Yeah, that's
Tim Kowal 38:05
right. Okay, let's talk about conflict referrals. This happens from time to time for litigation and trial attorneys. So in the instance where you two clients and then suddenly a conflict arises, and one or both of those clients will now need a new attorney. So Christie, can I refer those clients you know, that conflict client out without tainting the new attorney with the conflicts if I have, you know, two clients, and now one of them has a conflict, I want to keep one and send the other out. I guess I have to be careful not again, back to your first tip, not to vouch for the other attorney, I give them multiple options. But to the extent that I have a pre existing relationship with that other attorney as a colleague, do I have to worry about having tainted that colleague with the with my conflict?
Kristi Thomas 38:51
Yes. So this is a very difficult question to answer. And I'm going to try my best to answer it by talking about a few different scenarios here. Okay. So let's talk about where I usually see this issue arise or come up. It's in the context of joint representation. So talking about my bread and butter for a moment, which is employment law, let's say that I represent a company, the employer, and I'm also representing one of their employees, okay, one of their employees got individually sued. So I'm representing both of them. And maybe the company is called, we call them the Alpha clients. So they're the ones paying the bill. And the employee is the beta client. They're not paying the bill. All right. But something happens during the representation. So I don't know the employee ends up stealing stuff from the company, he has to be terminated. And so there's a conflict issue. You should already have in place, a joint representation letter or agreement, discussing the pros and cons of joint representation, okay. And you should really have language in that agreement, which allows you To decide which client you're going to continue on with, that allows you to drop a client. And you want both clients to be acknowledging that they understand that, okay, now when you need to draw, for example, the employee client, the new attorney, and again, this is in the context of joint representation, the new attorney, is there going to get a copy of the file? Because with joint representation, you can't keep communications from joint clients? So they're gonna get the copy of the file? But yeah, to your question, can you refer that employee client out to the new attorney? And so let me sort of present another scenario here, and maybe it'll help us answer this. So let's say you're not in the situation of joint representation, your firm just represents two clients to separate matters. Okay, and the conflict was not picked up on at the outset. And you just now determine the conflict. So can you refer one or both of them out? I think that's the conundrum. And I think it's going to be problematic there. Because on the one hand, you have, like we talked about earlier, you have an existing client, who wants you, of course, to refer them to well equipped counsel to handle their case. But on the other hand, you're essentially picking their adversary, right, the other clients, attorney, right, I think that's gonna, I think that's going to pose a problem. Now, if you do decide to refer out, you have to be very, very careful about not divulging confidential information you have on the other client. And let me just throw a third scenario out there. Because we see this one a lot, too. Let's say that your firm or you want to serve a records, it's just a record subpoena on a firm client. In California. Anyway, that's going to be considered direct adversity, serving a record subpoena on a firm client is direct adversity. So what do you do you probably call up the relationship partner at the firm? So the partner who represents the client, you want to serve the subpoena on? You tell them the situation? And then he calls up his client who says, Look, I have a colleague, they're just serving a record subpoena on you, is that okay? And most of the time, they'll say, Okay, but what if they say, nope, nope, that's not okay. So what do you do? You're gonna have to call up outside counsel, you're gonna say, Look, I need conflicts. Counsel, I need you to take this very small portion of this case, it's just serving a subpoena. Can you do that for me? And again, the question is, you know, what, can you tell them? How much can you share with them? You cannot divulge confidential information concerning the other client. I mean, it's you don't want to give them the keys to the kingdom? Because they could then be conflicted out if that makes sense. And it's sort of like remember that crazy fruit of the poisonous tree doctrine from law school is sort of like that, you know, you have confidential information you're conflicted out, okay. Here's the new attorney don't pass the confidential information on to them, or they're going to be conflicted out as well. So it's really a hairy issue, guys. It's tough.
Tim Kowal 43:15
Yeah. So I guess that means don't have in depth conversations with the potential new counsel certainly don't divulge any any confidential information. But I guess just giving a name and phone number to the soon to be former client would probably not get you into too much trouble. Is that right?
Kristi Thomas 43:31
Probably not. Yeah. Yeah.
I don't even know if you can whisper to your successor to this new lawyer, that there's a conflict the existence of a conflict that might plant ideas in their head? I don't know.
Yeah, it may. So that's, yeah, that's a really difficult one.
Tim Kowal 43:46
That is hard. Because when you're looking for a new attorney, that new attorney is going to want to know, you know, what's the deal here? How come you're leaving the representation? Because, you know, when you're not the first attorney on a case, that's, you know, that raises a red flag in the attorneys mind that you don't like to be the second third, fourth in line because that suggests that there's a could be a problem with taking on the representation. So they want to know that it's, you know, I don't think there's any problem letting them know that there's a conflict and that should trigger another warning flag that okay, I should be careful in eliciting information from the former counsel, that could disqualify me that could imbue me with the same conflict that former counsel has. So yeah, so these are important questions to ask because again, these are it's a it's a conversation that is attractive to have for the new counsel because look, I can get all that I can get the scoop I don't have to go through and you know, investigate the file. I can just kind of get the skinny on what this case is about from former counsel but be very careful there. You could conflict yourself out. Yeah, be very cautious. Okay. All right. The last question I want to ask you Christy about your article, avoiding pitfalls when making a referral to another lawyer. And in this is about the question of referral fees. Now there are a lot of attorneys who swear by referral fees love to give and to get referral fees and other attorneys who just won't touch them. won't ask for and won't take and what should attorneys know about giving and retaking referral fees?
Kristi Thomas 45:06
Yeah, so So my response here, I think, is pretty short and to the point, and it's if you have a referral fee agreement, it will be void unless you have client consent. Okay, the referral fee agreement needs to have client consent. So and I like to give this example, let's say that you have a huge wrongful death case that you're considering referring out to somebody who specializes in these types of cases. And you and that attorney agree that you're going to get a 10% referral fee, okay, and the case ends up going to trial, and the plaintiff does much better than anyone had expected. In fact, they recover 50 million at trial, and the attorney that you refer them to decides, no, you know what, I'm not going to give him his 10% referral fee now, okay, and you sue for that referral fee. The number one way that you're not going to get that referral fee is lack of client consent, a lot of attorneys agree on referral fees in the dark without the client knowing about it can't do that it needs to be in writing with their consent. I think just to tie into our other issue on negligent referrals, I think referral fees could also in a way, affect a negligent referral case. And what I mean there is, let's say that you have two really good attorneys in mind that you want to refer a case to, but they don't pay a referral fee, you come across somebody else who pays a referral referral fee, and you give them the case, okay, and that attorney loses, and you're sued for making a negligent referral, the optics there, guys are going to look very bad that you passed up two really good attorneys, because they didn't pay a referral fee and went with the other one who did pay them for paying you that referral fee. I mean, what if you have a trail of emails, a ton of them just showing you shopping around for the highest referral fee? It's not going to look good. It's not going to look good. And then just, you know, one more point on that. I think the role that you need client consent for referral fees really illustrates something here about the Rules of Professional Conduct, the Rules of Professional Conduct are enforced by the State Bar, okay, you can't have a cause of action for damages for violating a rule of professional conduct. The State Bar enforces them, but I will tell you courts look at them, and they borrow from them. So if you are in court on this referral fee issue, and you say to the judge, wait, we wait, Your Honor, we had a binding contract here, myself and this other attorney where he agreed to pay me 10% In referral fees, you have to enforce this, the court can say no, I'm not going to enforce it, because you don't have client consent there.
Tim Kowal 48:01
Yeah, well, one thing that occurred to me while you were explaining about how referral fees can play into liability for negligent referrals was back to your rule, again, about providing multiple potential referrals. And not just one attorneys name, but multiple names, and especially if one or more of those names that you're giving gives you back referral fees. If you're recommending somebody who gives you a referral fee, make damn sure that you are also referring giving the name of one or more other attorneys who don't have a referral fee relationship with you. Absolutely. Absolutely. And if you are the referring attorney, do you need to disclose to the potential client? If you're giving the name of another attorney who gives you referral fees? Do you need to disclose that to the attorney? Or can you just leave that for the referring the other attorney you're referring to count on them to disclose that to the client?
Kristi Thomas 48:49
So but I believe it needs to be disclosed in the agreement that the client needs to consent to. So there's a rule of professional conduct on this, and I'm blanking on the exact roll number, there are so many, but it basically says it needs to be in writing, you need client consent, the actual terms of the referral fee agreement need to be in writing who's involved who's going to get what, and then the fee that the client is paying cannot be increased solely because you're dividing fees, right? So I'll just throw things I mean, if you usually charge $100 just throwing this out there, but now it's $110 because you're gonna give a $10 referral fee. You can't up the fees just because you're going to be dividing them if that makes sense.
Tim Kowal 49:35
Yeah, yeah. Yeah. Okay. Well, Christy Thomas, thank you so much for coming on and talking with us about your article avoiding pitfalls when making a referral to another lawyer. Just as we close here. Were there any advice that we didn't cover that you want to cover with our audience or any parting remarks or advice for our audience, not legal advice, you are not their attorney, but any parting waiting? Well, we
Kristi Thomas 49:57
we did establish that Christine her firm are lawyers of record for all of our listeners establish that during the podcast?
No, I mean, I this was great, guys. Thank you so much. I mean, I think I guess the only other question that that I have had before and that others might have is, you know, will my will the insurance like the malpractice policy cover a negligent referral? There may be people wanting to know that I think the easiest answer there is just take a look at your policy and read the exclusions and ask yourself if I make a referral, is it going to be covered under the insuring agreement. Some of them guys are very, very broad these agreements and they cover any act error omission, they may even cover paralegals, and we know that paralegals aren't supposed to be practicing law, but they may even cover them. And some agreements are more narrow, they could just cover you know, professional services, professional legal services rendered. So you really need to take a look at the policy exclusions there.
I wonder to the extent a plaintiff is trying to avoid the high burdens of proving a legal legal malpractice case and they want the easy standard of a mere negligence case. If such a claim for negligent referral might be covered by just a general commercial liability policy, if not your legal malpractice case. It's negligence. It's like a trip and fall.
Yeah, it possibly could it possibly could. Interesting.
Tim Kowal 51:24
Yeah, that was a big lightbulb moment. For me, Christy, when you mentioned about this is just general negligence rules, not necessarily professional malpractice, but general negligence. That's and I think a lot of attorneys in our audience should stand up and take note of that. That is a little scary. But as Jeff pointed out the other maybe an additional way to address that because it is just general, it just like a slip and fall. Okay, well, that's gonna wrap up this episode. Again, we wanted to thank our sponsor case text for sponsoring the podcast and each week we include links to the cases we discussed using case text. listeners of the podcast can find a 25% discount available to them, but they sign up at case text.com/kalp. That's case text.com/c A LP. If you
Kristi Thomas 52:06
have suggestions for future episode, go ahead and email us at info at Cal podcast.com. And our upcoming episodes look on tip look for tips on how to lay the groundwork for an appeal when preparing for trial. All right, thanks.
Tim Kowal 52:17
See you next time and nothing in this podcast establishes an attorney client relationship. I see you next time.
Kristi Thomas 52:23
Thank you guys.
Announcer 52:23
You have just listened to the California appellate podcast, a discussion of timely trial tips and the latest cases a news coming from the California Court of Appeal and the California Supreme Court. For more information about the cases discussed in today's episode, our hosts and other episodes, visit the California appellate law podcast website at ca l podcast.com. That's c a l podcast.com. Thanks to Jonathan Cara for our intro music. Thank you for listening and please join us again
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
Last week I presented my talk “Ten Trial Tips from an Appellate Specialist” to the San Francisco Lawyers Network (Feb. 16, 2023). Here are the tips:
Rule Zero: Make the Record
#1 Make sure your theories of the case are captured in your pleadings
#2 Was key evidence excluded? Preserve the issue by making a proffer.
#3 Keep objecting to evidence if the judge “defers” ruling on your MIL.
#4 Object to Jury Instructions
#5 Review the Verdict for Inconsistences
#6 Request and Object to the Statement of Decision
#7 File a motion for new trial to preserve challenges to the damages amount …and Watch out for JNOVs!
#8 Calculate Appellate Deadlines Correctly
#9 Avoid Common Appellate Briefing Mistakes
#10 Advise your client about important post-judgment issues (Attorney fees and costs; SLAPP fees; Bonds and Stays of Judgment-Enforcement; Post-judgment interest)
Evergreen Tip: Get a Court Reporter!
You may download a PDF of my slideshow here.
Thank you to my colleagues who sent me their top tips!
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes a newsletter of appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get a weekly digest of these articles delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
“When I got out of law school,” Joseph Chora related, “I knew nothing.” So like many of us, he started out by taking any case that came in. Until, that is, a mentor told him “that’s a dumb idea.” Instead, you should “find something that is difficult, arcane, and that nobody knows how to do.”
A lot of trial attorneys seeking a judgment are like the dog that caught the car. So you got what you were after—now what?
There are few areas more important than judgment enforcement. After all, a judgment by itself has at best dubious value. Yet because the rules of judgment enforcement are so technical, few attorneys are prepared to turn that judgment into cash.
Watch the clip here.
Judgment-enforcement specialist Joseph Chora gives an overview of the process in episode 46 of the California Appellate Law Podcast.
Tim Kowal helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes a newsletter of appellate tips for trial attorneys at www.tvalaw.com/articles. His appellate practice covers all of California's appellate districts and throughout the Ninth Circuit, with appellate attorneys in offices in Orange County and Monterey County. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
You may be able to convince a judge that an arbitrator’s award was wrong on the law. The judge thought so in E-Commerce Lighting, Inc. v. E-Commerce Trade LLC (D4d2 Dec. 9, 2022 No. E074525) --- Cal.Rptr.3d --- and so reversed the setoff awarded by the arbitrator in this lender-borrower dispute.
Basically, the lender and borrower both prevailed and got awards of about $2.5 million against each other, which the arbitrator then set off against each other. The intervening bank (not a party to the arbitration) then moved to “correct” the award to eliminate the setoff, arguing it had a superior right to recover, and that the setoff interfered with that right.
The trial court thought that seemed a pretty easy fix, and reversed the setoff.
But that was wrong, the Court of Appeal held, because the trial court’s power was limited under Code of Civil Procedure section 1286.6(b), in cases where “arbitrators exceeded their powers,” to “correct[ing] without affecting the merits of the decision upon the controversy submitted.”
Where is the line between “correcting” a decision and “affecting the merits”? The court noted that, when the parties have contested an issue in the arbitration, the arbitrator's resolution of that issue is a decision on the “merits.””
Here, the question of setoff was raised as an affirmative defense in the arbitration, and was a litigated issue. So the arbitrator’s decision on it was on the merits, and thus beyond the trial court’s jurisdiction to alter via “correction.”
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
The issue that most often drags appeals back into more litigation is attorney fee and costs. What happens when, while focusing on the appeal, the prevailing party gets a substantial award of fees and costs?
We discuss these questions and more in this nuts-and-bolts episode of the California Appellate Law Podcast.
Appellate Specialist Jeff Lewis' biography, LinkedIn profile, and Twitter feed.
Appellate Specialist Tim Kowal's biography, LinkedIn profile, Twitter feed, and YouTube page.
Sign up for Not To Be Published, Tim Kowal’s weekly legal update, or view his blog of recent cases.
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Announcer 0:03
Welcome to the California appellate podcast, a discussion of timely trial tips and the latest cases and news coming from the California Court of Appeal, and the California Supreme Court. And now your hosts, Tim Kowal and Jeff Lewis. Welcome, everyone. I am Jeff Lewis.
Tim Kowal 0:18
And I'm Tim Kowal. Both Jeff and I are certified appellate law specialists and uncertified podcast hosts, we try to bring our audience trial and appellate attorneys some news and insights they can use each week in their practice. So so if you find this podcast helpful, please subscribe and recommend it to a colleague. And if you don't find it helpful, send it along to opposing counsel. Yeah, if you
Jeff Lewis 0:39
lose a ruling, send it to your judge overseeing your case. And a quick announcement. This podcast is sponsored by casetext. casetext is a legal research tool that harnesses AI and a lightning fast interface to help lawyers find case authority fast. I've been a subscriber to casetext since 2019, and I highly endorse their service and listeners of our podcasts will receive a 25% lifetime discount available if they sign up at casetext.com/calp. That's casetext.com/calp.
Tim Kowal 1:03
And then here's just a hot referral for case text. We were just talking before we hit the record button, Jeff about this question that we're going to talk about today. And it has have cases settled this and I've looked up on haystacks, and you looked up on case takes if we couldn't find an answer, we know that it must not It must be an open issue.
Jeff Lewis 1:19
Well, more importantly, neither of us took the 35 minutes it takes to log into Westlaw to get Westlaw you know, pass the sign in and the authentication to, you know, case text, you just log in and get rolling with your question.
Tim Kowal 1:30
That was I was pretty much sold on case text when I could log in in less than three seconds. So that was that is a big selling point. Well, so Jeff, we decided we wanted to talk about today an issue that comes up a lot in both of our practices, the issue that most often drags my appeals back into the litigation world is the issue of attorney fees and costs. So let me paint a quick picture of a common scenario, Jeff. So say the trial has not gone your way. And you're, you're getting geared up for the appeal. But while you're focusing on getting ready for the appeal, the prevailing party gets a substantial award of fees and costs. And so now you have a new set of problems, like do I have to separately appeal from this award of fees and costs? And how can I stay enforcement of the fees and costs award? Are they going to come after me to start, you know, execution liens on the fees and costs award? If I win my appeal, you know, hopefully knock on wood, I'm going to win this appeal. It's a righteous appeal. Does that make the the fees and cost award go away automatically? Can Can I just ignore the fees and costs and hope that I'm going to win that the underlying appeal of the judgment? So Jeff, I thought we just start out by asking to kind of go go through a lot of these questions, see if we can answer them for our listeners. So first question, conceptually, is when do you have to appeal that award of fees and costs? Do you appeal it as soon as the minute order comes down? Or do you wait for that signed formal, pretty looking formal order or wait for it to be added to the judgment?
Jeff Lewis 2:51
Right? Yeah, and so many judges have different practices about doing an amended judgment where they insert costs and attorneys fees later in a blank or a brand new judgment, or just let the clerk's enter costs and fees on the judgment on the clerk's roll. I have to tell you, Tim, there are many areas of appellate procedure where I can rattle off my head 60 days where Notice of Appeal counter designation rules. This is an area in terms of appealing attorneys fee awards that 100% of the time, I always go to the rudder group, because there's lots of traps for the unwary here.
Tim Kowal 3:20
Yeah, that's going to the rudder guide. As always sound move also calling the co host of the California appellate podcast would be a sound move.
Jeff Lewis 3:28
You're too busy and too expensive for me to rely on. But yeah, thank you for the offer.
Tim Kowal 3:32
I think we covered a case on this. The answer to the question is that you have to appeal from the minute order that minute order awarding fees is the appealable post judgment order under CCP nine Oh 4.1 A two. And if you wait, if you sit around and wait thinking that the court is going to sign a formal order or amend the judgment, the court may well do that. But that does not restart your time to appeal. And we had covered that before we'll post a link to this in the show notes li Liang vs. She this was a non published opinion. But that exact issue came up the appellant waited, figuring well, I'll get the judgment amended or I'll get a formal order. And by that time too late appeal from the minute order was untimely at that point right below the minute order awarding fee. So be careful about waiting around as soon as you get that minute order. It doesn't have to be signed or formal that minute order awarding fees and costs is the appealable order. All right. And also be careful about trying to amend the judgments generally, not only don't wait around for it, but be careful when you ask the judge to amend the judgment. We covered this also I'll post a link to that in the show notes. The amendments to a judgment during the appeal was reversed that no that's not the one I'm thinking about. Oh, the Court of Appeal didn't like it when the trial court amended the judgment because it created what the Court of Appeal called a quote procedural mess.
Jeff Lewis 4:48
Yeah. Well, I mean, let's be clear. If there is an appeal of the merits of a case and then there's a field award, the trial court can always amend the judgment to add the fees and costs with the trial court's can never do is if there's an appeal of the merits and an appeal of the fees and costs at that point, the trial court can't be messing around by amending or interlinear ating old judgments
Tim Kowal 5:10
right now the court can, you know, right in the number if the original judgment had said that the prevailing party is entitled to fees and costs of blank, then the clerk can enter Lynnie eight, the the number there, but in this other case, that will link in the show notes. There was a finding of prevailing party that was changed, and that was amended in the judgment. And that was a big nono. Yeah, for sure. 100%. Okay, so now we know when to appeal from the award of fees or costs. Now, the next question is, are the costs and fees award automatically stayed on appeal? And the short answer to that sometimes deceptive answer is yes. Awards solely for fees or costs are automatically stayed on appeal without the need to post a bond
Jeff Lewis 5:54
routine costs not involving an anti slap motion.
Tim Kowal 5:57
Okay, put a bookmark on that, Jeff, we're gonna get that reprise our argument on that in a moment. But you have you want to also talk about just do a quick city bus tour on stage and bonds of the money judgment.
Jeff Lewis 6:10
First question client asked me or should ask me or trial lawyer asked me or should ask me is can this be executed on pending appeal in terms of either the costs or the damages and costs. Normally, our state fees normally are stayed in a non slap context as to the damages. It's not state that the plaintiff can execute pending appeal. And so the things that I go over with clients are one don't forget about the discretionary requests for a stay the trial court, sometimes trial judges feel strongly their decisions are right, and sometimes they're like now on the fence go up to the Court of Appeal, and they might be receptive to a motion for discretionary stay of execution pending appeal
Tim Kowal 6:49
that discretionary stay. Are you referring to CCP 918 That provides that that temporary discretionary stay
Jeff Lewis 6:57
correct for a limited duration of time? And then for a longer term? Are we supposed to bond? And the question is how much that has to get posted? And what's it going to cost the client? And in terms of how much she usually one and a half times the amount of the judgment? That's the bond amount? And how much does that bond? Usually client? What depends on the client, you know, I've represented fortune 200 companies on appeal where the bond amount is very small, but very, in terms of the premium the cost to issue that bond, because the bond company surely thinks is a very small risk. On the other hand, Tim, if you need to post a bond, you might be more of a risk than a fortune 200 company that might be a higher premium. That's my experience. But generally, what's your experience?
Tim Kowal 7:35
My experience, I typically use CSBA, the court surety bond agency and they're usually across the board, their premium rate is 1% per year 1% of the face amount of the bond with the first year's premium being payable upfront.
Jeff Lewis 7:50
I'm really is that regardless of the financial viability of the appellant just straight up 1%.
Tim Kowal 7:55
That seems to be flat. I haven't seen any deviation in my experience. All right. And then
Jeff Lewis 7:59
yeah, you pointed out in our show notes that you always have to have a conversation with the client or trial counsel that yeah, you could state this judgment, but it'll be earning 10%, pending to three years of the appeal of what the client wants to write a bigger check at the end of the process,
Tim Kowal 8:13
always important to remind the client of that early and often because sometimes they will lose sight of that, and months and months go by, and then they're reminded that Oh, my God, I've got you know, this is a seven figure judgment that we're appealing. Suddenly he's got six figures and interest it's already accrued after the first year of the appellate process.
Jeff Lewis 8:31
And then finally, you know, we've covered this on earlier episodes of our podcast, there is a process to either personally pledge or have others guarantee offer personal guarantees in lieu of a formal bond from a surety rarely used, but we've come across it one or two times in our in our joint cases, right?
Tim Kowal 8:47
The discussion is too interesting not to bring it up. But I have not ever found any takers yet. That is, if you're ever interested in the concept of a personal surety contact Jeff for me about that we happy to talk about All right, so we've started this conversation about bonds and stays of enforcement of judgment, Jeff by talking about judgments purely for fees or costs. And then we talked about judgments for money judgments, and how to get stays of those. But what if there is an outstanding money judgment? And then there's also fees and costs added to it is the cost award automatically stayed pending the appeal? How do we think about that problem, Jeff?
Jeff Lewis 9:24
Well, this is your domain, that clueless case in terms of the impact of paying the money judgment, and leaving only the costs or attorney's fees as the unpaid portion. Um, there's some strategy involved here.
Tim Kowal 9:36
Yeah, yeah, the strategy usually is if the client has not already found a way to bond and stay the underlying money portion of the judgment, then the added costs and fees become part of the principal amount for purposes of determining what the bond amount would be. But the strategy that you raise is, well, what if the underlying money judgment could be paid? What if it's a relatively small amount you got one of those inverted Awards where the underlying money The judgment is fairly small, but the costs and fees are very large. And you could think about simply paying the underlying judgment amount, and then you're left only with the award of costs and fees, which may be subject to the automatic rule of an automatic stay. Now, there's another possible wrinkle there and I have been confronted with this argument, Jeff, that okay, the underlying judgment amount is paid, leaving only the cost and fees amount, which would be subject to the automatic stay rule. But can you go forward and still appeal from the under underlying judgment? So you've paid the underlying judgment, but you still want to challenge it on appeal. And you also want to appeal of the costs and fees and enjoy the automatic stay rule of the costs and fees? Does that work out? Because I've been confronted with this argument that no, the you can only as long as the judgment is being appealed from the cost and fees become part of that judgment. So you would still have to bond it in the amount of 150% of admitted surety bond?
Jeff Lewis 10:53
I think it's a solid argument. Candidly, I've never litigated the payment of judgment question. You know, one thing you always have to be aware of when you're talking about paying part or all of the judgment is the issue of waiver. If you simply write a check without duress without a debtors exam being noticed without wages being garnished, there are some arguments that maybe one or more issues on appeal might be waived. So you want to have a good record that you're paying under duress as opposed to conceding the liability pending appeal.
Tim Kowal 11:19
Right. Yeah, that is an important concern about you know, not when you pay off that judgment amount, you want to make sure it doesn't lead to a waiver or forfeiture argument. All right. Here's another related question about the let's say that you have one of these inverted situations where you've got a relatively small judgment of you got a huge costs and fees award, and you really want to get that stayed and you'd like to enjoy the automatic stay role, but whether you can get it automatically state or maybe you're even willing to post a bond for it, if you feel that's necessary. What happens if the fee award is pretty defensible, you know that it's well, within the trial judge's discretion, you don't really have a good ground to attack it on appeal. You don't want to file a frivolous appeal, but there's but absent an appeal, there's no way to get a stay of enforcement. What do you do there, Jeff?
Jeff Lewis 12:01
Yeah, that's a tough one, you might have to call your ethics hotline, because I'm always of the mind. You cannot appeal a fee award. If you don't have a good faith argument. For example, if you don't have a court reporters transcript, and you don't know what was said during that hearing, and there's not some clear legal heir simply filing an appeal to delay payment or otherwise, it's a problematic area.
Tim Kowal 12:22
Here's one possible way out, Jeff, and this reminder to our listeners of the case that we talked about some episodes back, and we'll include a link to that the case offhand. But it was the case that pointed out that there is a problem with the Judicial Council memo of cost form. You remember that what that problem is, Jeff?
Jeff Lewis 12:39
Yeah, yeah. It's that there's no signature line. And under penalty of perjury, there's just a council signature line without the statement that it's under penalty of perjury, and I think we it was raised in an unpublished decision that perhaps that's a problem.
Tim Kowal 12:52
Yeah, it was actually a published decision. And the decision said, Well, it's close enough that that was the the majority of the panel but the there was a dissenting opinion that said, No, it's not good enough. The memo of cost is what makes the prevailing party's initial burden of proof to shift the burden over to the opposing party to produce evidence to show that the costs were not actually incurred or not available. And without that initial burden, having been shown the memo, of course has to fail on its face for lack of verification under penalty of perjury. So that is an issue that if you're the prevailing party, in your case, has made use of the judicial council form a memo of costs and sign that without some other declaration, under penalty of perjury, you may have a good ground to challenge that entire memo of costs as failing the rule that has to be verified under penalty of perjury.
Jeff Lewis 13:38
I rule that that argument is colorable. I think
Tim Kowal 13:42
so if you've got a sitting Court of Appeal justice, who has written a dissenting opinion, a very lengthy does a deep dive into the statutory legislative history on what is required in a verification. So I think that's a defensible argument. I have to say that because I have adopted that argument in one of my appeals. Okay. Okay. So now, a few moments ago, Jeff, we put a bookmark on this question of whether all fees and costs are automatic subjected to the automatic stay of Enforcement Rule, and you made a reference that only non routine costs. What did you mean by that Jeff, only non routine costs are automatically stayed on appeal?
Jeff Lewis 14:20
Well, first of all, you call it a question. It's more of an issue of settled law that the spirit and legislative intent of the anti slap statute means that feel words are words of fees and costs pursuant to link the defendant in an anti slap case, those types of awards are considered a non routine award of costs, and that plus the legislative intent behind the anti slap law has been construed by the courts. To me these fee awards are simply not stayed pending appeal or not automatically stayed
Tim Kowal 14:50
well, and you have case law to support that. That's the Dowling versus Zimmerman case. You'll see that in all of Jeff's fee motions, but the legislature has abrogated this routine versus non routine distinction way back and it's amendment in 1993. And that amendment left all costs subject to the automatic stay rule except for the three categories of costs defined by statute, and those do not include anti slap fees. So Dalling, it seems, did not catch the drift of that amendment. But the quails versus parent court of appeal decision in from 2017 noticed that something was amiss and reasoned that quote, nearly all post judgment awards of costs in California courts should be subject to the automatic stay. So we did have you and I discussed this and Bandy this about back in episode 47. And I published article on this last year in the California litigation magazine, we'll include links to those in the show notes.
Jeff Lewis 15:43
Tim, publishing that article in litigation magazine does not make your argument strong. But congratulations. So I had an interesting stump Tim question or some jump question about sometimes trial courts will award fees, not to the defendant in an anti slap case, not to the person who brought the anti slap sometimes a trial court will find that an anti slap motion is frivolous and award attorneys fees to the party, the plaintiff, usually who had to oppose an anti slap motion, and one of my arguments about why there's no stay of fee awards normally for when a defendant prevails and gives a case dismissed is there's a policy interest of making an anti slap defendant hole and getting him out of the case as quick as possible. When a plaintiff successfully with stance and anti slap motion, it gets fees because the motion was frivolous? I'm not sure those same policy interests are implicated. And I wonder what would happen if somebody tried to enforce those fees pending appeal, those fees would be considered stayed pending appeal. What do you think, Tim?
Tim Kowal 16:49
Right. So you're talking about normally when we're dealing when you're dealing with anti slap fees, it's the prevailing defendant who's prevailed on the anti slap motion gets awarded his or her fees every now and then a defendant files a meritless anti slap motion and the plaintiff is entitled to fees if the court finds that the anti slap motion was brought not in good faith, and under my coils case, the answer would be easy that all fees, including slap fees are considered to be cost that are automatically stayed pending appeal. But then I suppose that it's possible that fees against the defendant in this situation, the defendant who's brought a bad faith slap motion, might that be considered a sanction? And if it's an award of sanctions or awards of sanctions, and this is a stump Jeff, question back to you, Jeff. Our award monetary sanctions awards automatically stayed on appeal, are they considered attorneys fees? Or are they? Are they more like money judgments?
Jeff Lewis 17:44
Well, let me say on the first question, your instinct is right, there have been a number of cases construing sanction awards to plaintiffs where the courts have analogize or relied on one 20.5 Or one 20.7, the sanction statutes or procedure on how to proceed with these V requests. And so it is not a stretch to think that a award to a plaintiff in an anti slap case for filing or having to oppose a frivolous slap motion, that that's really a sanction, not so much a an award of non routine costs within the meaning of dowelling.
Tim Kowal 18:17
Yeah, that's a space to watch, because I have not seen those issues taken up. So there's an arguable question of whether those fees awarded to the successful plaintiff who successfully defends a bad faith slap motion and gets fees for it. Is that a sanction award? Or is it an attorney's fees award? And then even if it's a sanction award, I don't know the answer to whether sanctions award are automatically stayed on appeal.
Jeff Lewis 18:39
My gut tells me it is not automatically stayed because the statutes and cases talking about the automatic stay referred to attorneys fees and costs, sanctions are more sometimes the trial courts impose sanctions amounts that have nothing to do with attorneys fees and costs. And so my gut tells me those are not automatically state but I will say this anecdotally, in my experience, when a notice of appeal is filed properly from a sanctions order in the proper form by the proper party, in anecdotally, Trial Courts will often stay enforcement pending resolution of the appeal. Although remember,
Tim Kowal 19:10
under CCP 918, the trial courts discretion to stay enforcement is limited to only up to 10 days after the notice of appeal could have been filed. So it's a relatively short stay. It's not going to last you the duration of the appeal.
Jeff Lewis 19:25
I'm going to tell you this, I can't remember ever handling an appeal of a sanctions award like this where the trial court did not say either it's part of the sanctions award or in a subsequent minute order. Yeah, well, it's a state pending appeal. But that's just my anecdotal experience.
Tim Kowal 19:39
Yeah. Interesting. I wonder if there's a different way you have to structure the court would have to structure the sanctions award to make it not payable for a certain amount of time. Or you could say I guess the court could say it's not payable until after an appeal.
Jeff Lewis 19:51
Well, and then I suppose the other side could try the prevailing party could try to enforce and then go up to the Court of Appeal on supersedeas or other grounds to try to get it stayed.
Tim Kowal 19:59
Yeah. Yeah, that's true. Okay, well, let's jump to our next topic, Jeff. So now we're gonna fast forward, let's say, because we've we've covered when you have to peel from the costs, the costs or fees award, and we've covered how to get them stayed pending the appeal. So now let's fast forward and say you've reversed the underlying judgment. So great news. But what happens to your appeal of the fees? Do you still have to go and litigate the fee award, Jeff, or Yeah, or is it automatically reverse? Because the premise for the fee and cost award was the judgment that the judgments gone away, then the fee and cost award has to go away to?
Jeff Lewis 20:31
Yeah, like magic disappears? Yeah, yeah, it
Tim Kowal 20:34
was covered in the Dr. Louisville case that we talked about last year. This was mid Wilshire property versus Dr. Louisville. And it was really interesting what happened here, because the appellants had reversed the judgment, the briefing had not even begun on the fee appeal of almost half a million dollars. So the parties were able to get together. And they jointly stipulated to request summary reversal of the fee Award and the court went along with it. So that may be a strategy because once you're up on appeal with the fee award, the trial court obviously can't vacate it, because the trial court has no jurisdiction over the fee award when it's up in the Court of Appeal. And I think the appellant was a little bit too weak in the knees to dismiss the VA appeal, because I don't know the the upshot of that does that wind up leaving it affirmed on the merits?
Jeff Lewis 21:20
Right. Yeah, that's great. I've never litigated that. It's a great question.
Tim Kowal 21:24
So I think you would need the Court of Appeals intervention. So if you think about it before you get to that point, and you are you're briefing, oral arguing the underlying judgment, and you know, you've still got a fee appeal kicking around there, you might remind the Court of Appeal that hey, by the way, if you do decide to reverse, you might just go ahead and dispose of the fee appeal as well, summarily, because it automatically goes away, because the premise for it has will will disappear when the judgments vacated.
Jeff Lewis 21:51
Yeah, yeah. And here's ethics corner laundry for you, Tim, a new segment on the show called ethics corner. Suppose you have an issue where there's either contingency case where Tim, you've received a big fee award, let's say on a slab or other contingency matter, and the fees, the client never paid any fees. So the fees go in your pocket, and then the other side appeals, and there's a risk that the case might be reversed, and that the client would have to disgorge those fees to the other side. And the client at that point in time wouldn't have those fees in his pocket, they'd be in your pocket. Tim, I wonder when you've taken a feel Ward on a contingency case, the fees are in your pocket, and there's some sort of risk disgorgement and maybe payment of interest upon that discouragement. If there are duties of disclosure and conflict waiver at the outset of the appeal where you tell the client if there's an appeal, here's what's going to happen to the money in Tim's pocket.
Tim Kowal 22:42
Oh, yeah, I think that's a great quandary. I would I think that's all the more reason not to take a penny until that judgment is final, final final. If there's still an appeal pending and it's that award, any monies collected or enforced on that money judgment are subject to discouragement. If the judgment is reversed on appeal. Well, don't take
Jeff Lewis 23:00
a penny unless you have a contract. You've died at dotted the I's cross the T's independent counsel, yada yada in terms of the client understands exactly who's going to do what if there's a reversal?
Tim Kowal 23:10
True? Yeah, that's a great puzzle to work through. Yeah, I would probably keep it in my client trust account. Yeah, I think there was another chapter of The Doctor Leavell saga where something similar happened, there was a substantial amount collected during the appeal, and then it was reversed, judgment was reversed. And then there was a restitution award under Code of Civil Procedure 918, which as you would interest, as you pointed out with interest. Yeah, it's just like a regular judgment. Just go in the other direction.
Jeff Lewis 23:36
Yeah. Wow. Well, reversal fortune.
Tim Kowal 23:39
All right. Well, I thought that we end this discussion about fees and costs award with a brief discussion about enforcement of fees. So this is separate from appellate fees. If you have lost your appeal, and the respondent had aggressively enforced the judgment, consider paying the entire judgment amount, plus interest fees and costs immediately and in cash, because here's where this can come up, Jeff, so you've taken this judgment up on appeal, and this time you've lost okay, it was not successful. But in the meantime, the other side has been just going gangbusters trying to enforce that judgment. So you know, they're going to be filing a motion for to recover their enforcement fees as soon as remitted or issue as soon as they get back to the trial court. Do they have to wait until remittitur issues for that? Jeff? I don't know that they do is enforcement collateral proceeding? Oh,
Jeff Lewis 24:26
no. Right. Just enforcement? No,
Tim Kowal 24:28
they don't have to. Yeah, but they might as a practical matter, wait until they get back and then they'll file their motion for appellate fees at the same time, and they'll file their motion for enforcement fees. So if you know that, okay, a big fat motion for enforcement fees is coming down the pike and I know I've lost on my appeal, go ahead and just pay off the entire judgment amount against you. You're gonna have to do it anyway. And if you pay it before, if you beat him to the court, if you pay it off before they filed their motion for enforcement fees, it cuts off the right to enforcement fees and the case on point is Supreme Court case can conservatorship of McQueen from 2014, the plaintiff, there prevailed in a suit for financial elder abuse, which was affirmed on appeal. But while the appeal is pending, the plaintiff incurred an enormous amount of fees to enforce the judgment, including filing a whole separate action for fraudulent transfer just 10 days before the plaintiff moved for some $300,000. In enforcement fees, the defendant went ahead and paid the entire underlying judgment amount, including all post judgment interest,
Jeff Lewis 25:27
but what's the story with it having to be in cash? Can you be presented or tendered with just an ordinary vanilla check or a certified cashier's check?
Tim Kowal 25:35
No, it has to be in cash because I forget what the statutory mechanism is there, but it has to be satisfied in full and satisfaction is not deemed to have occurred until the check clears basically, so the the judgment creditor has to have deposited it, it has to clear a wire transfer seems like it might be the equivalent of cash, but I don't know that. But the MacQueen court specifically lays out here that that it would have to be a cash payment if you wanted to enforce this statutory rule.
Jeff Lewis 26:02
So if a savvy creditor got a check, and then realize what the other side was doing, could the savvy lawyer creditors layer sit on that check file a motion for additional enforcement costs? And then while that motion is pending, then cash the check or wait till the hearing is held on the motion? And then cash the check?
Tim Kowal 26:19
Yes, yes, you could sit on the check. I don't know how long you could sit on the check and refuse to acknowledge satisfaction of judgment before you could get into trouble. That seems like an ethical problem to just refuse for an unreasonable amount of time to acknowledge satisfaction. But here was the kind of the money quote from the Supreme Court. On this point. The court says conceivably, a judgment debtor could satisfy the judgment by tendering cash for the full outstanding amount with interest before the creditor has sought his or her enforcement costs and fees, though this is likely to be rarity for sizable judgments. If the creditor has reason to believe that cash may be imminently tendered to pay the judgment prudence counsels filing a motion or memorandum for costs and fees accumulated to that point. If the judgment is not then satisfied, any costs or fees accruing later may be sought in a supplemental motion or memorandum. In any event, the possibility that some widely judgment debtor make a cash payment timed to foreclose, a final motion for costs and fees does not provide this court authorization to ignore the explicit unambiguous language of section 680 5.080 under the enforcement of judgments law and substitute a quote unquote reasonable time rule of our own invention and quote, so the court says we're driven by statute here, the motion for enforcement fees has to be filed before the judgment is satisfied. And if it satisfied, then sorry, you may have justly accrued, in this case, $300,000 or more in enforcement fees, but they all go away. If you don't file that motion before the Judgment satisfied, but to satisfy it, it has to be cold, hard cash.
Jeff Lewis 28:00
All right. We were going to be talking about attorneys fees and costs. Today. There's a recent California Supreme Court case I wanted to chat about briefly, you just discussed a case where the courts stuck to the words of a statute, and so they were bound by those words. I'm going to talk about an instance where maybe the clear words in the statute were not considered or stuck to this is Travis V brand, a case from my neck of the woods arising from a political dispute. in Redondo Beach, there was a lawsuit brought under the public the Political Reform Act, and the issue that went up on appeal was issue almost $900,000 in attorneys fees and trial court awarded in favor of the defendant against the plaintiff. Now, the California Supreme Court overturned that fee award because the trial court didn't make a finding that lawsuit was frivolous, that had been prosecuted in bad faith or continued in bad faith. There are lots of public interest statutes that talk about asymmetrical V or standards where one side has a higher burden of proof than the other to get fee awards. I'm thinking about Public Records Act and the Brown Act, where if a member of the public sues the city of a public agency, if the plaintiff wins, they get their fees no matter what if the city wins, the public agency wins. They only get the awards if there's a finding of bad faith. Now,
Tim Kowal 29:16
it turns out bad faith finding is not statutory. That was something that the Supreme Court imposed here.
Jeff Lewis 29:21
So what I'm just saying is, yeah, it's that I just talked about Public Records Act and Brown Act. It is explicit in the statute. It is not explicit in the Political Reform Act. Nice. And so the trial court just said, well, defendant one, no finding a bad faith and order them nearly $900,000 in attorneys fees, the California Supreme Court reversed and remanded for determination, but not saying you can't get these just a determination by a lower court as to whether or not there was a frivolous lawsuit here before these could be awarded.
Tim Kowal 29:49
Yeah, that's interesting. I I like where the court is going with that. It seems like that would that's something that that would appropriate, an appropriate asymmetrical amendment to the statute, but is that appropriate for the Supreme Court? board to be imposing that into this statute where the statute is silent on it.
Jeff Lewis 30:04
I'm a big fan of public interest lawsuits like actions under the Public Political Reform Act, and you don't ever want anything that's going to chill plaintiffs from sure filing such suits, but it's an odd result. I'll tell you another oddity. I don't do a whole lot of California Supreme Court work. The California Supreme Court remanded this to the Court of Appeal to determine whether or not the lawsuit was filed frivolously rather than the trial court, or maybe the Court of Appeal in turn will punt to the trial court. But I'd be hard pressed to understand how the Court of Appeal could make findings unless they took evidence or something.
Tim Kowal 30:35
Yeah, I wonder if that's the normal procedure. They just punted down. The next proximate level and Court of Appeal, like you said, may decide to just punt it back down on a remand finding. That might be a question. I'll have to ask David editor about that or Supreme Court. Right. That is that it's interesting. So that came up from the Court of Appeal. Did you happen to know whether the Court of Appeal and it come to a different result than the Supreme Court?
Jeff Lewis 30:58
If I recall correctly, the Court of Appeal had determined had affirmed that the trial court acted well within its discretion and making its feel Award and the California Supreme Court said discretion is not enough. This is an asymmetrical situation, you need a higher finding bad faith or frivolousness. By the defendants here, or by the plaintiffs.
Tim Kowal 31:17
Yeah. Oh, good. Good topical tidbit, Jeff, and you have a couple other tidbits you wanted to share today.
Jeff Lewis 31:23
Yeah, two bits of news, one LA Superior Court. You know, we're always talking on the show about the lack of court reporters and the problems that it causes for appeals and the LA Superior Court just recently announced a new initiative, offering financial incentives to bind court reporters, and we'll put a link in our show notes to this announcement. But basically, the court is going to be offering increased money for court reporters, student loan forgiveness for court reporters, bonuses for court reporters have been around for a long time and finders fees for court employees who refer court reporters back to the court. So I thought that was interesting, but the press release has some really interesting language in it that about the impact of a lack of record and access to justice, that I think if any lawyer at the trial or appellate court is litigating an issue about the absence of a court reporter at an access to justice, it's great language and their insight.
Tim Kowal 32:13
Yeah, well, that's interesting. We're really scrambling here to make up for this court reporter shortage. And it has been reported that this is not an issue of money. There's money in the budget for court reporters, but it's there's just a lack of supply of court reporters, not enough new people are entering the court reporter profession, and as the ones that are their age out or retire out. They're not being replaced. So it's interesting to see that the court here is acknowledging that by incentivizing student loan forgiveness so that court reporters can go to the court reporter schools and get the training. It's a very, very difficult, very taxing process to become a court reporter. I was not aware that the pass rate for the examination is very low, very low level, well below 50%. I can't remember the specific number off the top of my head, but there's just diminishing number of new entrants. So yeah, this is a interesting attempt to add a solution to the problem here. All right.
Jeff Lewis 33:07
And then the other tidbit I need from Ben Schatz, wonderful blog via scan blog. If you're going to be having oral argument in the second district, downtown LA from April 10. To June 2, I plan on doing it remote, the courtroom is actually going to be closed. They're going to be doing some technical upgrade upgrades to the courtroom. So remote arguments from April 10 to June 2.
Tim Kowal 33:29
Yeah, that's a pretty lengthy shutdown of the Ronald Reagan Building. So all right. All right. Well, I think that wraps us up, Jeff, we want to thank our sponsor one more time casetext for sponsoring the podcast each week, we include links to the cases we discuss using casetext and listeners of the podcast can find a 25% discount available to them if they sign up at casetext.com/calp. That's case text.com/C A L P.
Jeff Lewis 33:54
And if you have suggestions for future episodes, or you want to email Tim about why he's wrong about slap fiords not being staid. Go ahead and email us at email us at info at Cal podcast.com. And in our upcoming episodes, look for tips on how to lay the groundwork for an appeal for when preparing for trial. Alright, see you next time.
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You have just listened to the California appellate podcast, a discussion of timely trial tips and the latest cases a news coming from the California Court of Appeal and the California Supreme Court. For more information about the cases discussed in today's episode, our hosts and other episodes, visit the California appellate law podcast website at ca l podcast.com. That's c a l podcast.com. Thanks to Jonathan Cara for our intro music. Thank you for listening and please join us again
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
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When I tell trial attorneys my top appellate advice—don’t forget to get a court reporter—the common response is, “I already knew that.” But when I give them my second most important appellate advice—don’t forget to request a statement of decision—the common response is bemusement. “What for? The court gives a tentative decision, and I can request the statement of decision then.”
Not always, as the ARCO learned in Atlantic Richfield Co. v. California Regional Water Quality Control Board (D3 Dec. 5, 2022 no. C093124) 2022 WL 174141444 (nonpub. opn.). Following lengthy proceedings resulting in a cleanup order against ARCO, the Court of Appeal remanded the matter to the trial court for further proceedings. The trial court held a hearing that lasted all of 79 minutes. ARCO did not request a statement of decision before submitting. Instead, ARCO assumed it could wait until the trial court issued its written order, when it would have a 10-day period (plus a 5-day extension for mail service under CCP 1013) to request a statement of decision.
Not so. The trial court denied the request as untimely, because under California Rules of Court rule 3.1590(n), “When a trial is completed within one day or in less than eight hours over more than one day, a request for statement of decision must be made before the matter is submitted for decision . . . .”
ARCO then made an argument that was too clever by half—though it was supported by caselaw. ARCO argued that, although the proceedings only lasted 79 minutes, the judge must have spent a lot of time reviewing the voluminous record, and that would have taken more than eight hours. ARCO relied on Bevli v. Brisco (1985) 165 Cal.App.3d 812, 820.
But the court cast doubt on Bevli, and in any event did not follow it. Instead, the court followed In re Marriage of Gray (2002) 103 Cal.App.4th 974, including this quote from Gray explaining how to count to eight hours for purposes of determining whether you have to request a statement of decision at the hearing:
“We cannot realistically expect trial judges to keep stopwatches to record time spent off the bench in chambers, a home office, or at the kitchen table studying the law and evidence. Rather, the eight-hour rule in section 632 requires a simple and obvious mode of timekeeping that everyone, including attorneys, can keep track of. This means that, for purposes of keeping time of trial under section 632 in civil proceedings other than administrative mandamus (an issue not before us), the time of trial means the time that the court is in session, in open court, and also includes ordinary morning and afternoon recesses when the parties remain at the courthouse. It does not include time spent by the judge off the bench without the parties present—lunch, for example—except for such routine recesses as occur during the day.”
The Upshot: Failing to request a statement of decision can affect the outcome of your appeal. (See here for an example.) You need to request a statement of decision before the matter is submitted if the proceedings are less than one day or eight hours. How do you count eight hours? Include all time in open court, including recesses—but not lunch and evening recesses.
But why risk it? Just ask for a statement of decision before submitting. Even better: file a written request for a statement of decision at the outset of the proceedings, identifying the key issues on which you want the court to make findings.
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.
Ordinarily, it would not be newsworthy that a U.S. District Court allowed a brief that was filed 15 minutes late. But Judge R. David Proctor not only refused to strike the late-filed brief: he ruled that striking a brief just because it was filed 15 minutes late would be absurd.
In the District Court ruling in Whitworth v. Mezrano, 2:20-cv00756 (S.D. Ala. Jan. 13, 2023), available at Above the Law, Judge Proctor noted that “There are no doubt many other instances when 15 minutes could make a world of difference,” such as 15 minutes extra time presenting oral argument, or running a marathon, or making a departing flight. “But, the electronic filing of an opposition brief in this court on a late Thursday afternoon is not one of them.”
Judge Proctor then sketched out a parody chambers scene in a “parallel universe” in which idle court clerks expectantly scan the wires in the waning minutes approaching 5:00 p.m., breathlessly awaiting a litigant’s brief, whereupon they commit and resolve to devote their evening to “reading — no, consuming and cherishing — every syllable of this filing.”
“Only in such a distant, parallel universe,” Judge Proctor concludes, would striking the late-filed brief “make any sense.”
Upshot: Next time you need to seek leave to file a late brief, consider referencing Judge Proctor’s observation that filing a brief late by a matter of minutes could only make a difference in “a distant, parallel universe.”
Tim Kowal is an appellate specialist certified by the California State Bar Board of Legal Specialization. Tim helps trial attorneys and clients win their cases and avoid error on appeal. He co-hosts the Cal. Appellate Law Podcast at www.CALPodcast.com, and publishes summaries of cases and appellate tips for trial attorneys at www.tvalaw.com/articles. Contact Tim at tkowal@tvalaw.com or (714) 641-1232.
Get “Not To Be Published,” a weekly digest of these articles, delivered to your inbox by subscribing here: https://tvalaw.com/california-appellate-newsletter.