As Soon As You Realize What It Is - Stop Reading. Then Give It Back. Right Away.
Rico v. Mitsubishi Motors Corporation (Dec. 13, 2007, S123808)
16 p. opinion
42 Cal.4th 807
The rule that the Supreme Court sets forth in this decision is not a complicated one. If a lawyer receives a document that clearly appears to be privileged and it is "reasonably apparent that the materials were provided or made available through inadvertence," he or she should examine the document no further than is essential to determine that the document is privileged. Then he or she should immediately notify the sender of the situation so that the parties can either resolve it by agreement or turn to the court for any justified judicial intervention.
This approach protects the attorney-client privilege and the work product doctrine, prevents large document productions from becoming slower and more laborious than they already are, and fulfills the attorney's obligations to the bar, the judiciary and the administration of justice.
What shouldn't the lawyer do if he realizes after a minute or two that he is reading a work product document? He shouldn't make multiple copies of it and give them to his co-counsel and experts. He shouldn't discuss the contents of the document with each of his experts. He shouldn't use the document to impeach one of the opposing parties' experts during that expert's deposition.
What happens if he does? In this case the attorney showing such poor judgment represented the plaintiffs. As a result of his unethical behavior, the plaintiffs' attorneys and experts were disqualified.
(The plaintiffs, because they had not been told the contents of the document, were given time to obtain new counsel. This contrasts with the result for the plaintiffs in Stephen Slesinger, Inc. v. The Walt Disney Company whose intimate knowledge of the contents of illegally obtained documents tainted their case beyond repair.)
What if the lawyer is slow to realize that the document is privileged? That's a shame but not an excuse. The rule establishes an objective standard under which the court must decide when reasonably competent counsel would have realized the document was privileged.
Justice Corrigan wrote the opinion for a unanimous court.
Thursday, December 13, 2007
Monday, December 10, 2007
Review Roundup III
Patel v. Liebermensch (S156797)
I did not go out on any limbs when writing about this decision so you will have to take my word for it that I thought it was a close call. The Supreme Court will be addressing the question of whether the time and manner of payment are essential terms for a real estate purchase option contract. If so, then if they are absent no contract has been formed.
This is an important legal issue, but this case is not one that has potential to cause any noticeable effect in the way that real estate transactions are handled in California. The vast majority of such transactions are already conducted much more formally than the transaction that led to this lawsuit.
I did not go out on any limbs when writing about this decision so you will have to take my word for it that I thought it was a close call. The Supreme Court will be addressing the question of whether the time and manner of payment are essential terms for a real estate purchase option contract. If so, then if they are absent no contract has been formed.
This is an important legal issue, but this case is not one that has potential to cause any noticeable effect in the way that real estate transactions are handled in California. The vast majority of such transactions are already conducted much more formally than the transaction that led to this lawsuit.
Thursday, December 6, 2007
Review Roundup II
Fairbanks v. Superior Court (S157001)
When I wrote about this decision I praised it for its thoroughness. It was an issue of first impression but I found the Court of Appeal's four-part statutory interpretation very persuasive. I predicted that the Court of Appeal had resolved forever the question of whether insurance is covered by the Consumer Legal Remedies Act (CLRA). I was wrong.
On Nov. 14, the Supreme Court granted review on that very question.
When I wrote about this decision I praised it for its thoroughness. It was an issue of first impression but I found the Court of Appeal's four-part statutory interpretation very persuasive. I predicted that the Court of Appeal had resolved forever the question of whether insurance is covered by the Consumer Legal Remedies Act (CLRA). I was wrong.
On Nov. 14, the Supreme Court granted review on that very question.
Review Roundup I
Hughes v. Pair (S157197)
The Supreme Court has granted review in three of the cases that I have written about on this blawg. Its acceptance of Hughes v. Pair on November 28th is the one that I find satisfying.
In a previous post I promised to explain why FEHA and Title VII case law should not be used to make decisions under Civil Code section 51.9. It turns out that a vastly more qualified authority will address the question of whether FEHA's standards and definitions should be used to evaluate a claim for sexual harassment under Civil Code section 51.9. Obviously, I have already picked a side in this one.
The Supreme Court has granted review in three of the cases that I have written about on this blawg. Its acceptance of Hughes v. Pair on November 28th is the one that I find satisfying.
In a previous post I promised to explain why FEHA and Title VII case law should not be used to make decisions under Civil Code section 51.9. It turns out that a vastly more qualified authority will address the question of whether FEHA's standards and definitions should be used to evaluate a claim for sexual harassment under Civil Code section 51.9. Obviously, I have already picked a side in this one.
Wednesday, November 28, 2007
Petitioning Activity Can Be the Essence of a Contract
Anti-SLAPP Motion Fails When Plaintiff Makes a Showing That the Petitioning Activity Was a Breach of Contract
Midland Pacific Building Corp. v. King (11/28/07, 2d Civil No. B192017, Second Dist.)
12 p. opinion
Rehearing Opinion
157 Cal.App.4th 264
A developer brought suit against a landowner for breach of contract and fraud. The contract had provided that the landowner would obtain City approval of a draft tract map.
After the landowner presented a different, higher density tract map for approval at a planning commission hearing, the developer sued for breach of contract and fraud. The landowner brought an anti-SLAPP motion, arguing the suit was brought in response to the landowner's statements at an official proceeding in furtherance of his right of petition and free speech.
The Court of Appeal found that the breach of contract cause of action arose out of the petitioning activity. Indeed, the petitioning activity was the primary obligation of the landowner under the contract. However, it also found that the developer had shown a probability of prevailing.
The fraud cause of action was based upon private communications between the parties and therefore not based upon protected activity.
The anti-SLAPP motion had been correctly denied.
Presiding Justice Gilbert wrote the opinion. Justices Yegan and Coffee concurred.
Midland Pacific Building Corp. v. King (11/28/07, 2d Civil No. B192017, Second Dist.)
12 p. opinion
Rehearing Opinion
157 Cal.App.4th 264
A developer brought suit against a landowner for breach of contract and fraud. The contract had provided that the landowner would obtain City approval of a draft tract map.
After the landowner presented a different, higher density tract map for approval at a planning commission hearing, the developer sued for breach of contract and fraud. The landowner brought an anti-SLAPP motion, arguing the suit was brought in response to the landowner's statements at an official proceeding in furtherance of his right of petition and free speech.
The Court of Appeal found that the breach of contract cause of action arose out of the petitioning activity. Indeed, the petitioning activity was the primary obligation of the landowner under the contract. However, it also found that the developer had shown a probability of prevailing.
The fraud cause of action was based upon private communications between the parties and therefore not based upon protected activity.
The anti-SLAPP motion had been correctly denied.
Presiding Justice Gilbert wrote the opinion. Justices Yegan and Coffee concurred.
Monday, October 29, 2007
Sad Song
Illegal and Legal Provisions of a Contract Are Too Intertwined to Sever
Chiba v. Greenwald (Oct. 16, 2007, B193173, Second Dist.)
23 p. opinion (11 p. majority, 12 p. dissent)
This case stands out primarily because it concerns the estate of singer-songwriter Elliott Smith. While never a major commercial success he had, and despite his death on Oct. 21, 2003, continues to have, a devoted fan base. Outside of the world of indie music, he is probably best know for his Oscar-nominated song Miss Misery from the movie Good Will Hunting.
In this action Smith's live-in girlfriend sued the administrator of his estate for breach of an oral contract containing a provision that she would manage his music career in exchange for a 15% commission, and a Marvin agreement to provide household services in exchange for support. The provision that she would manage his career in exchange for compensation was illegal because the plaintiff was not a licensed talent agent as required by the Talent Agencies Act. (Labor Code section 1700 et seq.)
The question then became whether the legal Marvin agreement could be severed from the illegal management provision. The trial court concluded that the provisions were too intertwined to be severed and therefore the entire contract was void. A majority of the Court of Appeal agreed. Justice Johnson dissented, arguing that the complaint clearly alleged two separate promises made for two separate considerations.
Justice Zelon wrote the opinion. Justice Woods concurred. Acting Presiding Judge Johnson wrote a dissenting opinion.
Chiba v. Greenwald (Oct. 16, 2007, B193173, Second Dist.)
23 p. opinion (11 p. majority, 12 p. dissent)
This case stands out primarily because it concerns the estate of singer-songwriter Elliott Smith. While never a major commercial success he had, and despite his death on Oct. 21, 2003, continues to have, a devoted fan base. Outside of the world of indie music, he is probably best know for his Oscar-nominated song Miss Misery from the movie Good Will Hunting.
In this action Smith's live-in girlfriend sued the administrator of his estate for breach of an oral contract containing a provision that she would manage his music career in exchange for a 15% commission, and a Marvin agreement to provide household services in exchange for support. The provision that she would manage his career in exchange for compensation was illegal because the plaintiff was not a licensed talent agent as required by the Talent Agencies Act. (Labor Code section 1700 et seq.)
The question then became whether the legal Marvin agreement could be severed from the illegal management provision. The trial court concluded that the provisions were too intertwined to be severed and therefore the entire contract was void. A majority of the Court of Appeal agreed. Justice Johnson dissented, arguing that the complaint clearly alleged two separate promises made for two separate considerations.
Justice Zelon wrote the opinion. Justice Woods concurred. Acting Presiding Judge Johnson wrote a dissenting opinion.
California Trial Courts Have Inherent Power to Dismiss an Action
When a Plaintiff's Deliberate, Egregious Misconduct Has Made a Fair Trial Impossible, The Trial Court Has the Power to Impose a Terminating Sanction
Stephen Slesinger, Inc. v. The Walt Disney Company (Sept. 25, 2007, B178340, Second Dist.)
54 p. opinion
In this case the Court of Appeal holds that "when a plaintiff's deliberate and egregious misconduct makes any sanction other than dismissal inadequate to ensure a fair trial, the trial court has inherent power to impose a terminating sanction." (p. 1) The essential requirement is to calibrate the sanction to the wrong. The decision requires consideration of all relevant circumstances, including the nature of the misconduct, (which must be deliberate and egregious), the strong preference for adjudicating claims on the merits, the integrity of the court as an institution of justice, the effect of the misconduct on a fair resolution of the case, and the availability of other sanctions to cure the harm. (pp. 35-36)
This is the general rule. Much of the 54 page opinion is a detailed recounting of the misconduct that made a terminating sanction appropriate in this action. That description will be invaluable to any attorney who wants to determine whether such a sanction would be appropriate in a case where he represents the defendant. However, for the purpose of gaining a general understanding of this inherent authority, a shorter summary is adequate.
Plaintiff Steven Slesinger, Inc., after filing this action in 1991, engaged an investigator who over a period of years took thousands of pages belonging to Disney and turned them over to the principals of SSI. The investigator obtained the pages by repeatedly breaking into Disney office buildings and secure trash receptacles, and by trespassing onto the secure facility of the company with which Disney had contracted to destroy its confidential documents. The investigator stole documents from 1992 until 1995, and perhaps longer. On two occasions, in 1997 and 1998, SSI's attorneys turned over a highly confidential document to Disney, but SSI claimed that it did not know how it had obtained the document and/or that Disney had produced the document during discovery. SSI altered Disney documents to remove markings identified they as confidential.
It wasn't until 2002 that SSI revealed its employment of the investigator, and turned over more than 6,000 pages of Disney documents. SSI could not say how many total pages it had received because it had kept no record of either the documents that it had received or the documents that it had destroyed. This behavior provides the example of the deliberate and egregious misconduct that can justify a terminating sanction.
Most crucially, because SSI's principals had personally reviewed the stolen documents there was no way to prevent the use of the improperly obtained confidential information during the course of a trial. No change of counsel could prevent the principals from using this information, either consciously or unconsciously during trial. The forbidden knowledge could not be erased from the brains of the SSI principals.
As appalling as this behavior was, it is rather heartening to note that there is no indication that SSI had any attorneys who countenanced its behavior. SSI was represented by at least ten different law firms during the course of this lawsuit. Given the information in this opinion, it is not difficult to guess the reason for those many changes.
Acting Presiding Justice Willhite wrote the opinion. Justices Manella and Suzukawa concurred.
Stephen Slesinger, Inc. v. The Walt Disney Company (Sept. 25, 2007, B178340, Second Dist.)
54 p. opinion
In this case the Court of Appeal holds that "when a plaintiff's deliberate and egregious misconduct makes any sanction other than dismissal inadequate to ensure a fair trial, the trial court has inherent power to impose a terminating sanction." (p. 1) The essential requirement is to calibrate the sanction to the wrong. The decision requires consideration of all relevant circumstances, including the nature of the misconduct, (which must be deliberate and egregious), the strong preference for adjudicating claims on the merits, the integrity of the court as an institution of justice, the effect of the misconduct on a fair resolution of the case, and the availability of other sanctions to cure the harm. (pp. 35-36)
This is the general rule. Much of the 54 page opinion is a detailed recounting of the misconduct that made a terminating sanction appropriate in this action. That description will be invaluable to any attorney who wants to determine whether such a sanction would be appropriate in a case where he represents the defendant. However, for the purpose of gaining a general understanding of this inherent authority, a shorter summary is adequate.
Plaintiff Steven Slesinger, Inc., after filing this action in 1991, engaged an investigator who over a period of years took thousands of pages belonging to Disney and turned them over to the principals of SSI. The investigator obtained the pages by repeatedly breaking into Disney office buildings and secure trash receptacles, and by trespassing onto the secure facility of the company with which Disney had contracted to destroy its confidential documents. The investigator stole documents from 1992 until 1995, and perhaps longer. On two occasions, in 1997 and 1998, SSI's attorneys turned over a highly confidential document to Disney, but SSI claimed that it did not know how it had obtained the document and/or that Disney had produced the document during discovery. SSI altered Disney documents to remove markings identified they as confidential.
It wasn't until 2002 that SSI revealed its employment of the investigator, and turned over more than 6,000 pages of Disney documents. SSI could not say how many total pages it had received because it had kept no record of either the documents that it had received or the documents that it had destroyed. This behavior provides the example of the deliberate and egregious misconduct that can justify a terminating sanction.
Most crucially, because SSI's principals had personally reviewed the stolen documents there was no way to prevent the use of the improperly obtained confidential information during the course of a trial. No change of counsel could prevent the principals from using this information, either consciously or unconsciously during trial. The forbidden knowledge could not be erased from the brains of the SSI principals.
As appalling as this behavior was, it is rather heartening to note that there is no indication that SSI had any attorneys who countenanced its behavior. SSI was represented by at least ten different law firms during the course of this lawsuit. Given the information in this opinion, it is not difficult to guess the reason for those many changes.
Acting Presiding Justice Willhite wrote the opinion. Justices Manella and Suzukawa concurred.
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