Opinion
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
APPEAL from a judgment and orders of the Superior Court of Los Angeles County. Los Angeles County Super. Ct. No. BC319397, Michael L. Stern, Judge.
Wildish & Nialis, N. Ramsey Barcik and Daniel R. Wildish for Plaintiff and Appellant.
Burlison & Luostari and Walter R. Luostari for Defendants and Appellants.
ASHMANN-GERST, J.
This legal malpractice action arises out of the representation of Sandra Cardet (Cardet) by Burlison & Luostari, Robert C. Burlison, Jr. (Burlison), and Walter R. Luostari (Luostari) (collectively defendants) in connection with her claims against Parthenia Park Villas Homeowner’s Association (Parthenia HOA). Cardet successfully obtained a mechanic’s lien against Parthenia HOA. Several years later, a trial court determined that her lien was invalid and unenforceable, prompting her to file the instant action against defendants.
The matter proceeded to trial, and the jury returned a verdict in favor of Cardet. Defendants appeal the judgment and a host of trial court orders made before, during, and after trial. Cardet also appeals, challenging the trial court’s order denying her request for prejudgment interest.
We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Underlying Action
Parthenia HOA enters into a contract with Cardet
Following the January 17, 1994, Northridge earthquake, Michael and Nadine Shelley (the Shelleys) hired Cardet, a general contractor, to repair their home. At that time, the Shelleys were the property managers of the 40-unit Parthenia Park Villas condominium project (Parthenia project).
The Parthenia project had also suffered “extensive” damage in the Northridge earthquake. Thus, Parthenia HOA was soliciting bids for repairs. The Shelleys told Cardet what the other bids were, and informed her that if she wanted the contract, she “would have to come in under those bids.”
At some point, Cardet concluded that the Shelleys were dishonest. Cardet testified that the Shelleys told her “that they would be pulling out 10 percent of all of the moneys that were coming into the project from Farmers Insurance for themselves. That they were going to keep that money for themselves.” Later, Cardet discovered that the Shelleys were taking much more than 10 percent of the monies that Farmers Insurance was paying for the repairs to the Parthenia project. The Shelleys’ alleged dishonesty prompted Cardet to tape telephone conversations with them. The transcripts of those taped conversations were not admitted into evidence.
She apparently did, because on September 1, 1994, pursuant to a written agreement, Cardet was hired by Parthenia HOA to repair and replace portions of the Parthenia project.
Cardet’s complaint against Parthenia HOA
When Parthenia HOA refused to pay Cardet for work done, Cardet retained Green & Silverstrom to enforce her rights to collect funds owed for work performed. Green & Silverstrom prepared and recorded a mechanic’s lien against Parthenia HOA only; Cardet, in propria persona, filed a complaint in Los Angeles Superior Court.
On September 18, 1996, Cardet retained Burlison & Luostari to represent her “in connection with . . . [¶] [a]ny and all claims arising out of her participation as a contractor in the earthquake repair work at Parthenia Park Villas, from in or about January, 1994, to the present, including, as determined by [Cardet], prosecuting that certain mechanics lien filed by [Cardet] on June 7, 1996, and filing complaints against Michael and Nadine Shelley . . ., Parthenia Park Villas HOA,” and others. According to the terms of the retainer agreement: “If legal action is required to enforce this Agreement or to collect any fees or costs earned or advanced pursuant thereto, the prevailing party shall be entitled to recover any and all costs of such action, including, but not limited to, the expenses and court costs of the action [and] a reasonable attorney’s fee.”
Cardet originally retained Burlison, Luostari & Murphey; Burlison & Luostari is the successor law firm.
On or about December 10, 1999, Parthenia HOA filed a voluntary chapter 7 petition for bankruptcy with the United States Bankruptcy Court. Parthenia HOA’s bankruptcy was closed on April 26, 2000.
Cardet obtains a default judgment against Parthenia HOA
Meanwhile, on January 12, 2001, Burlison & Luostari obtained a default judgment against Parthenia HOA on Cardet’s behalf. Judgment was entered for the principal sum of $497,000, plus interest; thus, as of January 12, 2001, the total judgment was $797,532.43.
Cardet’s motion to add an additional judgment debtor is denied
At some point thereafter, Burlison & Luostari determined that Phoenix Homeowners Association (Phoenix HOA) was the successor homeowners association for the now-defunct Parthenia HOA. Thus, in the fall of 2001, it brought a motion on Cardet’s behalf to add Phoenix HOA as an additional judgment debtor. After continuing the motion to allow Burlison & Luostari to establish that Phoenix HOA was indeed the successor of Parthenia HOA, the trial court (Hon. Jeffrey L. Wiatt) denied Cardet’s motion. Although it determined that it was undisputed “that Phoenix [was] the new [homeowners association] formed by the individual homeowners who once went by the name Parthenia,” there was no evidence that Phoenix HOA was the alter ego of Parthenia HOA. Under these circumstances, therefore, “it would be impossible for a [homeowners association] to relieve itself of its debts in the new [homeowners association], which is required to exist by law, was always considered the ‘successor in interest’ despite the existence of a bankruptcy proceeding which extinguishe[d] the former [homeowners association’s] debts.”
Moreover, the trial court determined that Cardet could not “foreclose on the property at issue as that property [was] not owned by the [homeowners association], but [was] owned by the individual homeowners, against whom [she] failed to file mechanics liens.” Parthenia “was merely a corporation founded by the developer to manage this common interest development.”
The trial court continued: “Even if the mechanic’s lien were valid, enforcing it against Phoenix would be improper because Parthenia had no assets at the time of the bankruptcy.”
Finally, the trial court noted that Cardet had not foreclosed, and could not foreclose, on the real property and improvements. After all, “any judgment granting foreclosure rights to [Cardet] would violate the individual property interests of the owners.” Further, Cardet failed to comply with Civil Code section 1369; she failed to record the lien against the interests of the individual homeowners and she failed to apportion the lien per owner. “[B]y doing so, [she] lost her ability to enforce the lien against the individual owners.” Cardet “also failed to name the owners in the lawsuit and thus, they were not on notice of the claim and did not have an opportunity to defend their property interests.”
No motion for reconsideration or appeal was filed challenging Judge Wiatt’s order.
Instant Malpractice Action
On August 2, 2004, Cardet filed the instant legal malpractice action against defendants and others. Cardet alleged, in pertinent part, that defendants breached their “duty to correctly determine the proper parties against whom to file the appropriate claims/liens.” In other words, Cardet claimed that defendants failed to identify the proper parties (namely, the individual property owners as opposed to or in addition to Parthenia HOA) in a mechanic’s lien and/or failed to take legal action against those individual property owners.
Motions in limine
After the parties’ competing motions for summary judgment and summary adjudication were denied, the matter was ready for trial. As part of the pretrial preparations, the parties filed a host of motions in limine and proposed jury instructions. As is relevant to the issues in this appeal, Cardet filed motion in limine No. 7. In that motion, Cardet argued that defendants “intend[ed] to offer evidence of the foreclosure of certain units within the Parthenia [HOA] for the express purpose of arguing that [Cardet’s] recovery should be proportionately reduced.” However, pursuant to Civil Code section 1369, the homeowners would have been jointly and severally liable for the judgment obtained against Parthenia HOA but for defendants’ negligence. Thus, defendants should be precluded from introducing evidence of the foreclosure of certain units. Over defendants’ oral opposition, the trial court granted Cardet’s motion in limine No. 7.
Defendants did not file a written opposition to Cardet’s motion in limine No. 7.
Defendants filed motion in limine No. 2. In that motion, they sought an order excluding all references to evidence relating to defendants’ alleged ethical violations. The trial court denied defendants’ motion.
Jury instructions
Regarding jury instructions, the trial court declined the following instructions proposed by defendants: 16, 18, 19, 20, 21, 24, and 28. The trial court also refused defendants’ proposed jury instruction No. 26, which defendants requested pursuant to Loube v. Loube (1998) 64 Cal.App.4th 421, 428 (Loube).
Proposed jury instruction No. 16: “By the time defendants . . . brought the motion to amend the default judgment against Parthenia, the court could not change the money judgment or decree of foreclosure against Parthenia.”
Proposed jury instruction No. 18: “Judge Wiatt’s order changing the terms of the default judgment against Parthenia to preclude . . . Cardet from foreclosing was outside the court’s jurisdiction to do so and it may be set aside at any time on motion or in a separate lawsuit brought against Phoenix Homeowner’s Association.”
Proposed jury instruction No. 19: “A judgment is said to be void on its face when its invalidity is apparent upon inspection of the documents in the Court file.”
Proposed jury instruction No. 20: “The failure of defendants . . . to challenge Judge Wiatt’s order by motion or appeal does not prevent . . . Cardet from bringing a new motion to amend the judgment to include Phoenix Homeowners Association.”
Proposed jury instruction No. 21: “Defendants . . . had alternative remedies to pursue on behalf of . . . Cardet. If you find that because . . . Cardet did not want to sue the individual homeowners at the time defendants . . . were retained or during the course of litigation, against Parthenia, defendants[’] . . . course of action was to proceed under . . . Cardet’s complaint against Parthenia Homeowners Association. After obtaining the judgment, . . . Cardet’s remedy was to ask the court to order Parthenia to impose a special emergency assessment and if the Parthenia refused to do so, the Court had the power to appoint a receiver to carry out the Court’s Order.”
Proposed jury instruction No. 24: “In absence of . . . Cardet having contracted with the individual homeowner, the homeowner did not become personally liable to pay for the cost of labor and/or materials that . . . Cardet may have furnished to the homeowner’s condominium unit. . . . Cardet could not recover the reasonable value of services and materials from the homeowner even though the homeowner received and retained the benefits of . . . Cardet’s labor and materials.”
Proposed jury instruction No. 28: “A mechanic’s lien is subject to the defense of unclean hands. If you find that the conduct of . . . Cardet with Parthenia and the individual homeowners in the manner that she obtained the contract with Parthenia, and in dealing with Parthenia through Nadine Shelley, Michael Shell[e]y and CAS Management was [unconscionable], that conduct may invalidate . . . Cardet’s entire mechanic’s lien.”
Proposed jury instruction No. 26: “Defendants . . . are permitted in this case to present evidence that . . . Cardet should not have recovered a judgment against Parthenia. Defendants . . . may argue a different position in this action brought by . . . Cardet against defendant attorneys, that is, that . . . Cardet recovered all that she was entitled to, that . . . Cardet was not entitled to recover the amount of the default judgment against Parthenia, or other position argued against . . . Cardet’s recovery of a judgment. [¶] Defendants . . . are not bound in a legal malpractice/negligence action by a position they took on behalf of . . . Cardet during the lawsuit against Parthenia.”
Jury verdict
Following the presentation of evidence, the jury returned a special verdict in favor of Cardet. It found all three defendants negligent in their representation of Cardet and apportioned liability as follows: Burlison & Luostari – 50 percent; Burlison—30 percent; Luostari—10 percent; Cardet—8 percent; and others—2 percent. The jury found Cardet’s damages on her negligence claim to be $556,197.
The jury also found that defendants breached their contract with Cardet, resulting in damages for “breach of contract and/or breach of fiduciary duty” in the amount of $194,668.
Amended judgment
Cardet elected her remedy, and the judgment was amended. Ultimately, judgment was entered in favor of Cardet, with defendants jointly and severally liable for the sum of “$500,577.30, which represents the verdict of $556,197.00 reduced by 10% comparative negligence, with interest at 10% per annum.”
Cardet’s memorandum of costs and request for attorney fees
In February 2007, Cardet filed a memorandum of costs, seeking, inter alia, $272,492.50 in attorney fees. In response, defendants filed a motion to strike Cardet’s memorandum of costs and a separate motion to tax costs. Regarding Cardet’s request for attorney fees, defendants argued that the fee request was unreasonable and that “[t]here [was] not evidence of the contract related to this matter.”
In March 2007, Cardet filed a motion for an order fixing an award of attorney fees. She requested attorney fees in the amount of $269,492.50 on the grounds that she was the prevailing party on the contract between the parties (the retainer agreement), that the retainer agreement was broad enough to include her tort action, and that the amount of attorney fees requested was reasonable.
The amount was reduced by $3,000 because Cardet discovered an “isolated duplicate” in her memorandum of costs.
Following oral argument, the trial court denied defendants’ motion to strike Cardet’s memorandum of costs and motion to tax costs. It granted Cardet’s motion, awarding her attorney fees in the amount of $269,492.50.
Posttrial motions
Defendants’ posttrial motions, including a motion for a directed verdict, a motion for judgment notwithstanding the verdict, a motion for a new trial, and a motion to vacate the judgment, were denied.
Cardet also filed a posttrial motion, namely a motion for an order amending the judgment to include prejudgment interest or granting her a new trial exclusively on the issue of her right to prejudgment interest. On April 18, 2007, the trial court denied her motion. It reasoned: “Neither the course of the tort damages are unliquidated that speaks for itself, but the focus is on the damages that are in the judgment and that is contractual damages, not liquidated sums. There is not a liquidated sum before the judgment was rendered by the jury.” In other words, the trial court found that Cardet was not entitled to prejudgment interest because her claim was “unliquidated.”
Appeals
Defendants timely appealed from the judgment and all posttrial orders, including the order setting attorney fees.
Cardet timely filed a cross-appeal from the trial court’s order denying her motion for a new trial on the limited grounds of seeking prejudgment interest.
DISCUSSION
Defendants’ Appeal
I. Substantial evidence of collectability of the judgment
Defendants urge us to reverse the judgment on the grounds that Cardet failed to establish that an underlying judgment against the individual homeowners would have been collectable.
“[A] plaintiff in a malpractice action must prove he would have obtained a judgment in the underlying action and that the judgment, or some portion of it, could have been collected. . . . The issue continues to be that which it has always been: The plaintiff must prove that the underlying judgment could have been collected.” (Garretson v. Harold I. Miller (2002) 99 Cal.App.4th 563, 571.)
Cardet presented substantial evidence that the debt owed to Cardet could have been collected from the individual homeowners directly. Specifically, she offered the expert testimony of Mark A. Hiller (Hiller). Hiller explained that had defendants named the individual homeowners as defendants in the underlying action, then “they could have and should have recorded a lis pendens. . . . They could have simply recorded the document that would have attached a title to all of the properties, all 40 of the condominium units, stating that there was a lawsuit pending dealing with the mechanics lien.” “[F]rom the time that a lis pendens or notice of pending action is recorded forward, you can’t transfer title to that property. You can’t encumber it with a new loan, like refinancing it. You can’t do anything with that title, except if your buyer or your lender takes an interest in property subject to that lawsuit.” And, “[w]hatever equity [the individual homeowners] had in their property would have attached, and with the big run up in equities we have now, by now they certainly would have collected.” In other words, Cardet’s claim would have been protected by the lis pendens. She could have enforced the lis pendens to recover the monies that she was owed.
Because we conclude that Cardet presented substantial evidence of collectability, it necessarily follows that the trial court did not err in denying defendants’ motion for directed verdict.
On appeal, defendants argue that Hiller’s testimony is inadequate because he testified beyond the scope of his designation; he was not “designated to render an opinion on issues regarding real estate market conditions over the ensuing years, real estate values, equity or other financial matters concerning any of the homeowners.” By failing to raise this objection below, defendants have forfeited it on appeal. (In re Carrie W. (2003) 110 Cal.App.4th 746, 755.)
Defendants also claim that Cardet did not meet her burden because she did not present evidence as to (1) the solvency of the homeowners; (2) the homeowners’ income, expenses, or debts; (3) the market value of any particular unit; (4) encumbrances; or (5) whether any equity existed in any unit. Their argument is not persuasive. As set forth above, Hiller’s testimony provides sufficient evidence of collectability of a judgment against the individual homeowners. Had the evidence identified by defendants been presented, it would merely have bolstered Cardet’s claim.
In conjunction with this challenge, defendants argue that the trial court erred in granting Cardet’s motion in limine No. 7, which precluded them from presenting evidence of the foreclosure of 14 of the 40 condominium units before defendants were retained. Defendants claim that this evidence was relevant to the issue of collectability. The problem for defendants is that the evidence contained in the appellate record does not support their assertion. The appellate record reflects only three foreclosures (not 14), and they occurred in December 1996 and January 1999, after Cardet retained defendants. Accordingly, we find no abuse of discretion. (People v. Mincey (1992) 2 Cal.4th 408, 439.)
Finally, in a kitchen sink fashion, defendants assert that the trial court “committed numerous errors when it granted CARDET’S Motion in Limine No. 7 and precluded [defendants] from introducing evidence of the foreclosure of 14 units prior to their being retained by CARDET; refused [defendants’] Special Jury Instructions relating to the evidence and law that went to the heart of their case-within-a-case in a legal malpractice action; interposed its own objection of leading the witness and then lectured the jury on leading questions while [defendants’] expert witness . . . was on the witness stand . . ., commented in the presence of the jury that [defendants’] expert witness was making it up as he went . . .; and, cutting off trial counsel for [defendants] when on cross-examination, she attempted to elicit testimony from CARDET of her complicity with Shelleys’ kickback scheme after CARDET had testified at length about her alleged ‘blowing the whistle’ on the Shelleys to allegedly protect the homeowners and Parthenia from the Shelleys’ kickback scheme . . ., which further precluded the presentation of telephone conversations taped by CARDET and her employees between them and the Shelleys showing CARDET’S complicity with the Shelleys.” Aside from the fact that this sentence is muddled and unintelligible (People v. Dougherty (1982) 138 Cal.App.3d 278, 280), defendants’ assertion is unsupported by any argument or legal authority. (Sprague v. Equifax, Inc. (1985) 166 Cal.App.3d 1012, 1050; Evans v. Centerstone Development Co. (2005) 134 Cal.App.4th 151, 165.) Defendants failed to meet their burden of overcoming the presumption of correctness of the judgment from which they appeal. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.)
II. The damage award is not excessive
Defendants assert that “[t]he [t]rial [c]ourt committed prejudicial error when it refused special jury instructions that [they were] not bound by the default judgment and were not estopped to contest the default judgment.” Although the opening brief is unclear, we presume that defendants are challenging the trial court’s refusal to give special instruction Nos. 26 and 28.
“When the sole contention on appeal concerns a jury instruction, we do not view the evidence in a light most favorable to the prevailing party. Rather, to assess the instruction’s prejudicial impact, we assume the jury might have believed appellant’s evidence and, if properly instructed, might have decided in appellant’s favor. [Citation.] ‘Accordingly, we state the facts most favorably to the party appealing the instructional error alleged, in accordance with the customary rule of appellate review. [Citation.]’ [Citations.] [¶] Still, ‘[i]n a civil case an instructional error is prejudicial reversible error only if it is reasonably probable the appellant would have received a more favorable result in the absence of the error. [Citations.]’ [Citations.] . . . [¶] Hence, when evaluating the evidence to assess the likelihood that the trial court’s instructional error prejudicially affected the verdict, we ‘must also evaluate (1) the state of the evidence, (2) the effect of other instructions, (3) the effect of counsel’s arguments, and (4) any indications by the jury itself that it was misled.’ [Citation.]” (Mayes v. Bryan (2006) 139 Cal.App.4th 1075, 1087–1088; Soule v. General Motors Corp. (1994) 8 Cal.4th 548, 572, 580–581.)
Applying these factors, we readily conclude that the trial court did not commit reversible error in refusing to give defendants’ proposed jury instruction No. 26. Quoting from Loube, supra, 64 Cal.App.4th at page 428, defendants requested jury instruction No. 26 to advise the jury that attorneys “are not estopped from taking a contrary position in the malpractice action from the one they took below because it was their job in the prior action to advocate strenuously for the client.” Even if it were error for the trial court to have refused proposed jury instruction No. 26, that error was not prejudicial. Defendants’ attorney was able to illustrate this point during closing argument. Specifically, she stated: “You know, it might seem strange that an attorney would take one position in the underlying case, in the prior case, and then take a different position here, but that’s—that’s just the nature of lawsuits. [¶] When an attorney is representing a client, the attorney is an advocate. It’s an adversarial system. Each side, just as in this trial, presents the case in the best light. But once the attorney has been sued, then the attorney who is a defendant is like any other defendant. They have a right to defend themselves to the best of their abilities and to raise issues that they would never have raised in the underlying matter because of their obligations to their client. But the obligation ends once you are sued.”
Moreover, other jury instructions set forth the law regarding an attorney’s liability for malpractice. The jury was told, for example, about the standard of care. It was also instructed that “[a]n attorney is not necessarily negligent just because the attorney’s efforts are unsuccessful or the attorney makes an error that was reasonable under the circumstances. [¶] An attorney’s negligent only if the attorney was not as skillful, knowledgeable, or as careful as other attorneys would have been in similar circumstances. [¶] An attorney’s not necessarily negligent just because the attorney chooses one legal strategy when it turns out that another strategy would have been a better choice.” These instructions framed defendants’ responsibilities to Cardet, suggesting that those obligations were different than the tactics taken in their defense of the legal malpractice action.
And, there is no indication that the jury was at all misled.
We likewise conclude that the trial court did not commit reversible error in refusing defendants’ proposed jury instruction No. 28. Defendants wanted a specific instruction on unclean hands based upon the following: The Shelleys had a preexisting business relationship with Cardet; according to defendants, the Shelleys improperly aided Cardet in obtaining the contract for the repairs to the Parthenia project, and Cardet was complicit in the Shelleys’ kickback scheme to keep at least 10 percent of the monies that Farmers Insurance was paying to Parthenia HOA for the repairs. Based upon this evidence and theory, they wanted the trial court to instruct the jury that Cardet’s unclean hands vis-à-vis Parthenia HOA did not entitle her to any monies; in other words, had Parthenia HOA defended Cardet’s claims against it (as opposed to allowing a default judgment to be entered), she would not have established her entitlement to any damages because of her improper conduct.
Even if the trial court did err in refusing special instruction No. 28, that error does not amount to reversible error. Defendants were permitted to question Cardet about her relationship with the Shelleys. Following the presentation of evidence, the jury was instructed regarding witness credibility and that Cardet’s damages, if any, may have been caused in whole or in part by her own negligence. Based upon this evidence and these instructions, the jury was free to consider whether Cardet had an improper relationship with the Shelleys and whether that relationship impacted her ability to obtain a judgment against Parthenia HOA.
And, as mentioned above, there is no indication that the jury was misled. In fact, the jury attributed 8 percent of the fault to Cardet. This finding arguably suggests that the jury weighed the evidence of Cardet’s relationship with the Shelleys in apportioning negligence and setting Cardet’s damages.
Defendants also argue that the damage award was excessive it failed to account for monies that Cardet received. Defendants’ theory is as follows: Cardet’s claim under the mechanic’s lien was $497,000; however, she owed a subcontractor (Kemp Plastering) $253,000; she received $25,000 from Farmers Insurance; and she received $82,000 from Ranger Insurance. Thus, her claim should have been reduced to $137,000. Moreover, that “amount should have been further reduced by the percentage attributable to the fourteen (14) homeowners who had lost their homes in foreclosure or thirty-five (35%) percent equaling $173,950, which would reduce her recovery to zero.” Defendants further claim that the testimony of Bruce R. Greenwood (Greenwood), their handwriting expert, establishes that Cardet endorsed two checks and thus received an additional $217,166. Based upon this evidence, according to defendants, “[a]s a matter of law,” the jury verdict contradicts the evidence. We disagree.
The jury heard evidence regarding Cardet’s claim against Parthenia HOA as well as evidence of offsets against that claim. It also heard contradictory testimony regarding Cardet’s purported signature on the back of two checks; while Greenwood testified that Cardet had endorsed those checks, Cardet testified that the signatures were not hers. The jury then awarded her damages based upon all of this evidence. Defendants fail to offer any legal authority that this procedure and the subsequent jury verdict are improper as a matter of law. (Sprague v. Equifax, Inc., supra, 166 Cal.App.3d at p. 1050; Evans v. Centerstone Development Co., supra, 134 Cal.App.4th at p. 165.)
As set forth above, there was no evidence that 14 of the 40 units were foreclosed; and, defendants offer no legal authority to support the proposition that even if that evidence existed and had been presented, the verdict should have been reduced by a commensurate percentage.
Finally, defendants assert that the jury verdict was excessive because it was inconsistent. Instead of awarding different amounts for tort and contract damages, the jury should have awarded the same amount of damages, if any, on both claims. Again, absent a fully-developed argument, supported by legal authority, defendants’ contention fails. (Sprague v. Equifax, Inc., supra, 166 Cal.App.3d at p. 1050; Evans v. Centerstone Development Co., supra, 134 Cal.App.4th at p. 165.)
III. Cardet could recover from the individual homeowners
Citing James F. O’Toole Co., Inc. v. Los Angeles Kingsbury Court Owners Assn. (2005) 126 Cal.App.4th 549 and ECC Construction, Inc. v. Ganson (2000) 82 Cal.App.4th 572, defendants assert that Cardet never could have recovered monies from the individual homeowners. Thus, they claim that the trial court erred in refusing their proposed special instruction No. 24. Defendants misconstrue the case law.
In ECC Construction, Inc. v. Ganson, a “condominium complex was damaged in the 1994 Northridge earthquake. The homeowners’ association executed a contract with plaintiff ECC Construction, Inc., to repair the common areas and the individual units. None of the homeowners were signatories to the contract. A dispute arose as to the amount due ECC Construction under the contract.” (ECC Construction, Inc. v. Ganson, supra, 82 Cal.App.4th at p. 574.)
ECC Construction then brought an action against the association and the homeowners seeking to recover monies allegedly due under the contract. (ECC Construction, Inc. v. Ganson, supra, 82 Cal.App.4th at p. 574.) It also filed a mechanic’s lien against the homeowners. (Id. at p. 577.) The homeowners moved for summary judgment on the ground that they were not parties to the contract. (Id. at p. 575.) The trial court granted their motion, and ECC Construction appealed. (Ibid.) The Court of Appeal affirmed. (Ibid.)
After citing various provisions of the Corporations Code regarding the homeowners’ association’s status and the obligations of members of such association, the Court of Appeal noted: “ECC Construction’s claims against the individual homeowners were not based on an alter ego theory or a debt they owed the association. As a result, the Corporations Code bars suit against them. The owners were not parties to the construction contract, and they are not liable for the association’s debts or liabilities.” (ECC Construction, Inc. v. Ganson, supra, 82 Cal.App.4th at p. 576; see also James F. O’Toole Co., Inc. v. Los Angeles Kinsbury Court Owners Assn., supra, 126 Cal.App.4th at p. 560 [an insurance adjuster properly obtained a judgment against a homeowners association and then “compel[ed] the Association to look to its members, the homeowners, to create a fund to pay the debt incurred for their common benefit”].)
As for the mechanic’s lien against the homeowners, the Court of Appeal affirmed the trial court’s order dismissing ECC Construction’s cause of action to foreclose on the lien. (ECC Construction, Inc. v. Ganson, supra, 82 Cal.App.4th at p. 577.) “The evidence established that, as of the time of the summary judgment motion, ECC Construction had not apportioned the lien per owner,” as required by Civil Code section 1369. (Id. at p. 578.) “By failing to do so, it lost the ability to enforce the lien against the individual homeowners.” (Ibid.)
Nothing in either of these two cases supports the proposition that Cardet had no remedy against the individual homeowners. Cardet may have been able to sustain a claim under an alter ego theory. (ECC Construction, Inc. v. Ganson, supra, 82 Cal.App.4th at p. 576.) Likewise, a mechanic’s lien could have been filed against the individual homeowners and successfully foreclosed upon so long as the proper procedure was followed. (Id. at pp. 577–578.) It follows that the trial court did not err in refusing to give defendants’ proposed special instruction No. 24.
Defendants assert that they could not amend the mechanic’s lien or Cardet’s complaint to name the individual homeowners because (1) Cardet did not want to pursue the individual homeowners, and (2) Cardet knew the identities of the individual homeowners and thus could not avail herself of the Doe amendment procedure. Defendants fail to cite any legal authority to support their proposition that the mechanic’s lien could not be amended. As for their claim that Cardet could not utilize the Doe amendment procedure, Hiller testified that that is exactly what defendants should have done. And, with respect to defendants’ claim that Cardet did not want to pursue the individual homeowners, Cardet testified that she did not limit who her attorneys “could go after” to collect her monies. While “[a]t the very beginning [she] did not want to sue the individual homeowners,” she later changed her mind.
Cardet focused upon this claim during oral argument as well.
Defendants’ contention, reiterated during oral argument, that Cardet did not want to pursue the individual homeowners because she feared a construction defects claim is pure speculation.
In addition to those remedies, Hiller, Cardet’s expert, testified that defendants could have, and should have, filed a lis pendens, a “document that would have attached a title to all of the properties, all 40 of the condominium units, stating that there was a lawsuit pending dealing with the mechanics lien. That would have involved them, as well.” A lis pendens is not mentioned in, let alone prohibited by, either James F. O’Toole Co., Inc. v. Los Angeles Kingsbury Court Owners Assn., supra, 126 Cal.App.4th 549 or ECC Construction, Inc. v. Ganson, supra, 82 Cal.App.4th 572.
Finally, defendants assert that they could not have committed malpractice because Cardet still has a remedy pursuant to Code of Civil Procedure section 989. Defendants do not explain how this statute applies to this dispute. By failing to set forth a fully-developed legal argument, they have waived this theory. (Sprague v. Equifax, Inc., supra, 166 Cal.App.3d at p. 1050.) And, it appears to us that the statute does not apply. According to ECC Construction, Inc. v. Ganson and James F. O’Toole Co., Inc. v. Los Angeles Kingsbury Court Owners Assn., the individual homeowners are not “jointly indebted” to Cardet as they were not parties to the contract between Cardet and Parthenia HOA.
Code of Civil Procedure section 989 provides: “When a judgment is recovered against one or more of several persons, jointly indebted upon an obligation, by proceeding as provided in Section 410.70, those who were not originally served with the summons, and did not appear in the action, may be summoned to appear before the court in which such judgment is entered to show cause why they should not be bound by the judgment, in the same manner as though they had been originally served with the summons.”
Regardless of whether she has a remedy pursuant to that statute, the evidence established that defendants breached their duty of care to Cardet by failing to pursue the individual homeowners, and that Cardet was damaged by that negligence. Therefore, defendants cannot avoid liability simply by claiming that they pursued one remedy over another.
IV. The trial court did not commit prejudicial error by refusing to give defendants’ proposed special jury instruction Nos. 16, 18, 19, 20, and 21
Defendants assert that the trial court committed reversible error by refusing to give their proposed special jury instruction Nos. 16, 18, 19, 20, and 21, instructions that relate to the propriety of Judge Wiatt’s order. Defendants’ contention is hardly persuasive, particularly given the fact that they fail to offer argument or legal authority, which cuts off any meaningful review. (Sprague v. Equifax, Inc., supra, 166 Cal.App.3d at p. 1050; Denham v. Superior Court, supra, 2 Cal.3d at p. 564.)
Regardless, applying the factors set forth above, we disagree. It is not reasonably probable that defendants would have received a more favorable result had these proposed instructions been given. (Mayes v. Bryan, supra, 139 Cal.App.4th at p. 1087.) After all, as evidenced by the special verdict, the jury found Cardet and her witnesses credible; it simply did not believe defendants.
And, during closing argument, defendants were able to argue that Cardet’s default judgment against Parthenia HOA was still valid and enforceable. Specifically, defendants’ attorney informed the jury that Cardet could “still enforce the default judgment against Parthenia” HOA. Cardet still “has a default judgment that she can still execute on.” She also stated that a homeowners’ association could issue a levy against the homeowners in order to collect monies to pay Cardet. These comments suggest that Judge Wiatt’s order regarding the enforceability of that default judgment was invalid.
Finally, there is no evidence that the jury was misled.
V. The trial court did not abuse its discretion in denying defendants’ motion in limine No. 2
Defendants assert that the trial court erred in denying their motion in limine No. 2, thereby allowing Hiller to testify that defendants violated Business and Professions Code section 6068.
The trial court did not abuse its discretion in denying motion in limine No. 2. Although Hiller did mention Business and Professions Code section 6068 in his testimony, he only did so once; he stated that pursuant to Business and Professions Code section 6068, “[a]ttorneys have an affirmative duty to keep their clients informed of all material events.” However, the essence of Hiller’s testimony was that defendants breached their duties owed to Cardet and that their conduct fell below the standard of care. Defendants were able to, and did, offer contradictory evidence; their expert, Michael Portner, stated that defendants “did meet the standard of care of reasonable prudent attorneys.” Under these circumstances, Hiller’s brief, isolated reference to Business and Professions Code section 6068 did not prejudice defendants.
Moreover, we are compelled to point out that defendants’ representation in their opening brief regarding Hiller’s testimony on this subject is utterly false. Defendants assert that they were precluded from defending against Cardet’s “claim[] that [defendants] violated their ethical duties by taking a position contrary to what they argued when they were her advocates.” That is not what Hiller stated in his testimony. As mentioned above, when Hiller referred to Business and Professions Code section 6068, he did so only after explaining an attorney’s “affirmative duty” to inform his or her client of all material events. He never testified, or even hinted, that defendants were not allowed to take a position in the legal malpractice action different than the one they advocated in the underlying action on Cardet’s behalf.
Hiller also never testified that defendants’ “failure to advise the trial court in the underlying action of the correct amount of compensatory damages and of any legitimate off-sets . . . [w]as somehow unethical.” Presumably this explains defendants’ failure to offer a record citation in support of this assertion. (Guthrey v. State of California (1998) 63 Cal.App.4th 1108, 1115–1116.)
Finally, for the sake of completeness, we note the following: There is no evidence to support defendants’ argument that this testimony prejudiced or inflamed the jury.
VI. The trial court properly denied defendants’ motion for summary judgment
We review the trial court’s order denying defendants’ motion for summary judgment de novo. (Buss v. Superior Court (1997) 16 Cal.4th 35, 60.)
Defendants moved for summary judgment on the grounds that (1) Judge Wiatt’s order was void and thus could be set aside at any time; and (2) Cardet’s claim against Parthenia HOA was subject to various offsets, including a claim for $253,440 by Kemp Plastering, a subcontractor, and monies that Cardet received from the Shelleys but did not credit against Parthenia’s debt.
The trial court properly denied defendants’ motion for summary judgment as disputed facts existed. First, as the trial court expressly found, the parties disputed the legal effect of Judge Wiatt’s order; while Cardet asserted that his order became the law of the case, defendants argued that Judge Wiatt’s order was void and could be set aside at any time. “The question about what would have happened had [the lawyers] acted otherwise is one of fact unless reasonable minds could not differ as to the legal effect of the evidence presented.” (United Community Church v. Garcin (1991) 231 Cal.App.3d 327, 334.) Because reasonable minds differed as to the legal effect of Judge Wiatt’s order, a triable issue of fact existed, precluding the entry of summary adjudication.
Second, a triable issue of fact existed as to the amount of the offsets, if any, against Cardet’s claim against Parthenia HOA. Specifically, in her declaration, Cardet disputed Kemp Plastering’s claim of $253,440. She also disputed defendants’ assertion that she received monies from the Shelleys; she claimed (as she did at trial) that checks made payable to her bore forged endorsements.
VII. The trial court properly awarded Cardet attorney fees
As set forth above, the jury awarded Cardet $556,197 in tort damages and $194,668 in contract damages. Cardet elected tort damages, and the judgment was amended to reflect her election. According to defendants, because the retainer agreement was not used as a basis for the amended judgment, Cardet is not entitled to recover attorney fees from defendants. They are mistaken for at least two reasons.
Defendants also claim that “[t]here is no evidence of the contract related to this matter.” Nonsense. This lawsuit stems from the parties’ contractual relationship; not only was the retainer agreement attached as an exhibit to the complaint, it was admitted into evidence.
First, Cardet did prevail on her contract claim. Civil Code section 1717 provides, in relevant part: “(a) In any action on a contract, where the contract specifically provides that attorneys’ fees and costs, which are incurred to enforce that contract, shall be awarded . . . to the prevailing party, then the party who is determined to be the party prevailing on the contract . . . shall be entitled to reasonable attorney’s fees in addition to other costs. [¶] . . . [¶] (b)(1) . . . [T]he party prevailing on the contract shall be the party who recovered a greater relief in the action on the contract.”
According to the plain statutory language, Cardet was the prevailing party on her contract claim. That is exactly what the jury determined. Our analysis need go no further.
Defendants appear to argue that because Cardet was required to elect between her tort and contract damages, and she chose tort damages, she is precluded from recovering attorney fees pursuant to the contract. As with most of defendants’ arguments on appeal, this contention is not supported by any legal authority. (Sprague v. Equifax, Inc., supra, 166 Cal.App.3d at p. 1050; Evans v. Centerstone Development Co., supra, 134 Cal.App.4th at p. 165.)
Second, the parties’ retainer agreement is broad enough to include tort claims. (See, e.g., Lerner v. Ward (1993) 13 Cal.App.4th 155, 160.) The parties’ retainer agreement provides for the recovery of attorney fees “[i]f legal action is required to enforce this Agreement.” Through both her tort and contract claims, that is exactly what Cardet sought to achieve. Her success on all fronts entitles her to attorney fees.
Cardet’s Appeal
Cardet objects to the trial court’s order denying her prejudgment interest. She claims that she is entitled to prejudgment interest pursuant to both Civil Code sections 3287 and 3288.
I. Standard of review
As for Cardet’s claim pursuant to Civil Code section 3287, subdivision (a), “we independently review whether and when [Cardet’s] damages were certain or capable of being made certain by calculation.” (KGM Harvesting Co. v. Fresh Network (1995) 36 Cal.App.4th 376, 390–391.) By the statute’s plain language, the abuse of discretion standard of review applies to Cardet’s claim under Civil Code section 3287, subdivision (b).
Regarding Civil Code section 3288, we independently determine whether the trial court erred in removing the question of prejudgment interest from the jury’s deliberations. (Barner v. Leeds (2000) 24 Cal.4th 676, 683 [statutory construction is a question of law that we review de novo].)
II. Civil Code section 3287, subdivision (a)
Civil Code section 3287 provides for the payment of prejudgment interest to every person entitled to receive damages which are certain or capable of being made certain by calculation if the right to receive such damages vested on a particular day. (Civ. Code, § 3287, subd. (a); Chesapeake Industries, Inc. v. Togova Enterprises, Inc. (1983) 149 Cal.App.3d 901, 906 (Chesapeake).) “‘Damages are deemed certain or capable of being made certain within the provisions of subdivision (a) of [Civil Code] section 3287 where there is essentially no dispute between the parties concerning the basis of computation of damages if any are recoverable but where their dispute centers on the issue of liability giving rise to damage.’ [Citation.]” (Wisper Corp. v. California Commerce Bank (1996) 49 Cal.App.4th 948, 958.) In other words, damages are certain or capable of being made certain by calculation, or ascertainable, for purposes of section 3287, subdivision (a) if the defendant actually knows the amount of damages or could readily compute that amount from information reasonably available to the defendant. (KGM Harvesting Co. v. Fresh Network, supra, 36 Cal.App.4th at p. 391.) In contrast, damages that must be determined by the trier of fact based on conflicting evidence are not ascertainable. (Fireman’s Fund Ins. Co. v. Allstate Ins. Co. (1991) 234 Cal.App.3d 1154, 1172–1173; Wisper Corp. v. California Commerce Bank, supra, at p. 960 [“[W]here the amount of damages cannot be resolved except by verdict or judgment, prejudgment interest is not appropriate”].)
“There are two lines of authority which instruct us in the proper award of prejudgment interest under section 3287, subdivision (a). First, interest traditionally has been denied on unliquidated claims because of the general equitable principle that a person who does not know what sum is owed cannot be in default for failure to pay. [Citation.] Thus, no prejudgment penalty is assessed against a litigant for failing to pay a sum which is unascertainable prior to judgment. . . . [¶] The second line of authority advances the countervailing policy that injured parties should be compensated for the loss of the use of their money during the period between the assertion of a claim and the rendition of judgment. [Citation.] . . . [¶] These competing policy considerations have led the courts to focus on the defendant’s knowledge about the amount of the plaintiff’s claim. The fact the plaintiff or some omniscient third party knew or could calculate the amount is not sufficient. The test we glean from prior decisions is: did the defendant actually know the amount owed or from reasonably available information could the defendant have computed that amount. . . .” (Chesapeake, supra, 149 Cal.App.3d at pp. 906–907.)
Applying these legal principles, we agree with the trial court that Cardet was not entitled to prejudgment interest pursuant to Civil Code section 3287, subdivision (a). Her damage claim against defendants was anything but certain. While she sought to recover the entire amount of the default judgment ($497,000, plus interest), that amount was disputed by defendants, not only in terms of liability but in terms of the amount actually owed. Defendants presented evidence and argued that the amount sought by Cardet was subject to a host of offsets, was barred by her unclean hands, and was not collectable. The jury then had to determine which offsets and defenses were valid and what amount, if any, defendants owed Cardet.
Hansen v. Covell (1933) 218 Cal. 622, cited by Cardet, is distinguishable. In that case, contractors brought a lawsuit against the owner of a building for breach of a construction contract, based upon the owner’s failure to pay two installments of the contract price. (Id. at pp. 624–625.) After trial, the lower court determined that the contractors had substantially performed the contract and thus were entitled to judgment for the specified sums, but the owner was entitled to an offset for certain imperfections and defective workmanship. (Id. at p. 625.) The plaintiff was awarded interest on the two unpaid installments. (Ibid.) The building owner appealed, objecting to the award of interest, contending that “whenever a liquidated sum becomes due under a contract but which is subject to deduction by reason of an unliquidated offset, the balance due is not a sum ‘capable of being made certain by calculation’ because the ‘person liable does not know what sum he owes, and therefore can be in no default for not paying.’ [Citation.]” (Id. at p. 629.)
The Supreme Court agreed that the contractors were entitled to interest, yet modified the amount due. “Where, therefore, in cases such as here presented, the deduction is for defective workmanship, or is otherwise of a character such as to constitute payment to the contractor, and on the theory that the contractor is entitled to interest only on such amount of the use of which he has been deprived during the period of default, the court may properly allow interest only on the balance found to be due after deduction of such offsets and payments.” (Hansen v. Covell, supra, 218 Cal. at pp. 630–631.) Importantly, in so holding, the Supreme Court noted that “[t]he result reached on these appeals is not to be construed as interfering with the application in a proper case of any general rule that where the liquidated demand is subject to reduction by virtue of an unliquidated claim the balance due is deemed to be an unliquidated sum upon which interest is not recoverable.” (Id. at p. 631.)
Unlike the situation in Hansen v. Covell, Cardet’s claim is not for a specified amount due under a construction contract; her claim is for negligence. While she generally was seeking to hold defendants liable for damages that she could not recover from Parthenia HOA, that amount was not a certain amount, such as the specific installment payments due the contractors in Hansen v. Covell, supra, 218 Cal. at p. 625. And, even if her demand against defendants were construed as liquidated and certain, defendants sought to reduce her claim by an unliquidated sum, rendering Cardet’s judgment not certain and thus not subject to prejudgment interest. (Id. at p. 631.)
Moreover, the question of whether and to what extent defendants had any liability for Cardet’s damages was “hotly disputed.” (Wisper Corp. v. California Commerce Bank, supra, 49 Cal.App.4th at p. 961.) Comparative negligence was a key issue. In fact, at the end of the trial, the jury broke up liability as follows: Burlison & Luostari—50 percent; Burlison—30 percent; Luostari—10 percent; Cardet—8 percent; and others—2 percent. It follows that the amount of damages could not have been determined until after trial. (Id. at p. 962.)
III. Civil Code section 3287, subdivision (b)
For the same reasons, we readily conclude that the trial court did not abuse its discretion in awarding Cardet interest pursuant to Civil Code section 3287, subdivision (b). That statute provides: “Every person who is entitled under any judgment to receive damages based upon a cause of action in contract where the claim was unliquidated, may also recover interest thereon from a date prior to the entry of judgment as the court may, in its discretion, fix, but in no event earlier than the date the action was filed.” (Civ. Code, § 3287, subd. (b).) Cardet asked the court to exercise its discretion pursuant to that statute, and absent an indication otherwise, we presume the trial court did so when it denied her request. (Evid. Code, § 664.)
IV. Civil Code section 3288
Civil Code section 3288 provides that “[i]n an action for the breach of an obligation not arising from contract, and in every case of oppression, fraud, or malice, interest may be given, in the discretion of the jury.”
We cannot adopt Cardet’s position that this action does not arise out of a contract. The parties’ relationship was governed by the retainer agreement. While she prevailed on both her claims for negligence and for breach of contract, under the facts presented in this case, we cannot segregate the negligence claim from the contractual nature of this action.
Cardet should not forget that that is exactly why she is entitled to recoup attorney fees, as discussed in section VII, ante.
It follows that the trial court did not err in refusing to allow the question of prejudgment interest to be decided by the jury.
DISPOSITION
The judgment and orders are affirmed. The parties to bear their own costs on appeal.
We concur: BOREN, P. J. CHAVEZ, J.