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Pech v. Morgan

California Court of Appeals, Second District, Third Division
Dec 12, 2023
No. B317438 (Cal. Ct. App. Dec. 12, 2023)

Opinion

B317438

12-12-2023

RICHARD PECH, Plaintiff and Appellant, v. THOMAS E. MORGAN III et al., Defendants and Respondents

Law Offices of Richard Pech and Richard Pech for Plaintiff and Appellant. Joshua R. Furman Law Corp. and Joshua R. Furman for Defendants and Respondents.


NOT TO BE PUBLISHED

APPEAL from a judgment of the Superior Court of Los Angeles County No. 18STCV02178, Laura A. Seigle, Judge. Affirmed.

Law Offices of Richard Pech and Richard Pech for Plaintiff and Appellant.

Joshua R. Furman Law Corp. and Joshua R. Furman for Defendants and Respondents.

EGERTON, J.

Plaintiff Richard Pech appeals a judgment entered on the jury's general verdict in favor of defendants Thomas E. Morgan III; Juanita Springs Associates, LP (Juanita Springs); and Covina Hills MHC, LP (Covina Hills). Pech sued defendants for breach of contract to recover allegedly unpaid attorney fees under a written fee agreement. He contends the evidence was insufficient to support the defense verdict and the trial court prejudicially erred when defendants violated an in limine order. The record does not support those contentions. We affirm.

BACKGROUND

1. The Lawsuit

Plaintiff Richard Pech is an attorney. Defendants Juanita Springs and Covina Hills invest in commercial properties, including a mobile home park in Covina Hills. Defendant Thomas Morgan is a principal of the two entities.

Pech filed this lawsuit to recover attorney fees allegedly incurred representing defendants in legal matters related to defendants' operation and ownership of the Covina Hills mobile home park. The operative complaint asserts causes of action for breach of contract, fraud, account stated, and quantum meruit based on defendants' alleged failure to pay Pech's attorney fees under the parties' fee agreements.

2. Pech I

Pech filed applications for attachment orders against the assets of Juanita Springs and Covina Hills. The trial court granted the applications, concluding Pech had established the probable validity of his breach of contract claims. Defendants appealed the resulting orders, and this court affirmed. (See Pech v. Morgan (2021) 61 Cal.App.5th 841, 847 (Pech I).)

In Pech I we held that "when an attorney sues a client for breach of a valid and enforceable fee agreement, the amount of recoverable fees must be determined under the terms of the fee agreement, even if the agreed upon fee exceeds what otherwise would constitute a reasonable fee under the familiar lodestar analysis." (Pech I, supra, 61 Cal.App.5th at p. 846.) To be enforceable, we explained, the amount of the fee to be charged under the agreement "cannot be unconscionable." (Ibid.) And, we held, "consistent with the attorney's fiduciary duty and the implied covenant of good faith and fair dealing, that the attorney has a contractual obligation to render performance in good faith and in a professional manner, and that the attorney's performance must be reviewed under a reasonableness standard that accounts for this obligation." (Id. at p. 853, italics added.) Thus, to establish his breach of contract claim, an attorney suing his client for unpaid fees under an enforceable fee agreement must prove he" 'used reasonable care, skill and diligence in performing the duties required of [him] under the contract, that unnecessary, duplicative or unproductive time [was] not charged to the client, and that [he] [did] not perform[ ] services that were required as a result of [his] negligence or some lack of ordinary skill or diligence.'" (Id. at p. 852; see also id. at p. 855.)

3. Trial

Consistent with our standard of review, we recount the evidence admitted at trial in the light most favorable to defendants as the prevailing parties. (Janice H. v. 696 North Robertson, LLC (2016) 1 Cal.App.5th 586, 597 (Janice H.).)

On April 6, 2016, Morgan executed two written fee agreements on behalf of Juanita Springs and Covina Hills for the purpose of retaining Pech's legal services. The first fee agreement retained Pech to represent defendants in a lawsuit brought by 95 tenants of the Covina Hills mobile home park who alleged the park had been inadequately maintained (the failure to maintain case). The second agreement retained Pech "to perform all legal services that are necessary or proper for the protection of Client's interests concerning the matter of insurance coverage" in connection with the failure to maintain case (the insurance coverage case). Both fee agreements specified the hourly rates for Pech and his staff.

Pech's billing statements for the failure to maintain case came at irregular intervals, frequently spanned 50 to over 100 pages, and often included charges for tasks performed many months earlier. For example, Pech sent Morgan the initial billing statement in July 2016. The statement totaled over $138,000, spanned 71 pages, and included charges for fees and costs billed from February (before the fee agreement had been signed) through July 2016. He sent a third billing statement at the end of November 2016. That statement totaled over $377,000, spanned 126 pages, and included charges for fees and costs billed from June through November 2016.

Although described in the defense expert's report, several of the billing statements for the failure to maintain case, including a May 2017 statement totaling over $217,000, do not appear to have been included in Pech's 4,596-page appellant's appendix.

In August 2017, Morgan instructed Pech to contact defendants' insurance carrier and provide information the carrier needed to settle the failure to maintain case. In an earlier email, Morgan had explained to Pech that defendants faced "financial calamity" and making those materials available required Pech's "full and immediate attention and cooperation" to move the case toward resolution. Morgan emphasized "there [was] no capacity for any additional expenditure." He directed Pech not to undertake further work until Pech made the requested materials available and they had an opportunity to speak about moving the case to settlement.

Pech refused to make the materials available to Morgan or the carrier. He also continued to bill to the case, while badgering Morgan for payments. When Pech finally provided Morgan with a settlement assessment for the insurer (still without sending the requested materials), he included as one of the "essential terms of any settlement with plaintiffs," the carrier's "payment of $1,000,000 to the Law Offices of Richard Pech."

By November 2017, Morgan had grown more worried about Pech's intransigence and unwillingness to cooperate with the insurer. Driven by these concerns, he hired the Greenberg Traurig firm to provide an "independent review" and "assessment" of the failure to maintain case, while preparing the case for an upcoming mediation and settlement. Adam Siegler (a Greenberg Traurig attorney) requested the client file from Pech to conduct the review. Siegler testified it took "a long time" to get the materials from Pech and he was "not sure" he ever received a complete client file. The interactions with Pech made clear to Siegler that Pech was "withhold[ing] the file in order to compel the client to pay him." Based on the work product Siegler reviewed, he could not understand how Pech had billed over a million dollars in fees on the failure to maintain case.

The mediation went forward in mid-November 2017. Pech and his associate Thang Le attended, as did Morgan, Siegler, and Lance Orloff (the coverage counsel for defendants' insurer). Siegler and Orloff, both of whom had significant mediation experience, observed that Pech had no interest in settling the case. Pech presented a video he had prepared of the mobile home park, while Le ran the video equipment-neither of them participated in settlement discussions. The mediation ended without a settlement. Morgan attributed this outcome largely to Pech's failure to work with the insurance carrier to confirm the amount of coverage defendants had available for settlement.

A second mediation took place in March 2018. Pech did not attend. Defendants settled the failure to maintain case for $2 million, with the carrier and excess insurer contributing a combined $1.6 million and defendants paying the remaining $400,000.

To complete the settlement, Siegler asked Pech to sign a voluntary substitution of attorney form so that Greenberg Traurig could take over as lead defense counsel. Pech did not sign the substitution.

In April 2018, Morgan prepared a letter to Pech terminating the representation. Addressing the ongoing fee dispute, Morgan wrote, "I know that you believe attorneys' fees are owed to you; I do not and, in fact, [I] believe it is likely that you overcharged me and have been overpaid." The day before Morgan could finalize and send the letter, Pech moved ex parte to be relieved as counsel.

In less than two years, Pech had billed over $1.8 million in claimed fees on the failure to maintain case. Of that, he was paid over $1.1 million.

On the insurance coverage case, Pech had billed over $53,000. He charged a significant portion of those fees to the preparation of a complaint for insurance bad faith against defendants' carrier. Pech told Morgan the complaint would be their "silver bullet" for securing full payment of all fees and costs generated to defend the failure to maintain case. Morgan later learned Pech had received and cashed checks from the carrier partially paying some of his fees. When Morgan asked Pech what effect that would have on the insurance bad faith claim, Pech acknowledged it would "kind of make[ ] it more difficult." Defendants never filed the complaint. Pech was paid over $32,000 on the insurance coverage matter.

Andre Jardini testified as a defense expert assessing the reasonableness of Pech's performance under the fee agreements. At the time of trial, he was a practicing attorney who, for more than 30 years, had reviewed attorney billing records to assess whether legal services were appropriately rendered in a given case. Jardini received and reviewed a complete set of Pech's billing statements before turning the statements over to his auditors. The auditors then looked at every line of every billing record to identify "problematic entries" and compile them into an "outline of services" that Jardini referenced in formulating his opinion.

Jardini and his team identified the following issues (among others) in Pech's billing statements: 16 people worked on the failure to maintain case, often doing the same task at the same time; Pech's team billed over 500 hours to interoffice conferences, with Pech's senior associate Le billing nearly 18 percent of his time (293 hours) to conferences; 13 different attorneys and staff members spent over 430 hours preparing and revising charts and maps, and an additional 345 hours preparing PowerPoint slides for a case in the long-cause system with no set trial date; Pech's team took more than 80 depositions in the failure to maintain case, often with multiple attorneys attending and preparing for the depositions, despite a reasonable likelihood that the plaintiffs' claims would be relatively consistent; despite billing nearly 8,000 hours to the litigation, Pech's team spent very little time (234 hours) on written discovery; Pech's team spent over 656 hours on tasks related to experts, with more than half that time spent preparing or revising expert reports that the experts had been paid to prepare; Pech regularly sent three to four attorneys or staff members to site visits and inspections of the Covina Hills park, billing over 400 hours to prepare for, travel to, and attend the visits; and there were 138 occasions when Pech or a member of his team billed more than eight hours in a day to the case, with no apparent allowance for eating, taking breaks, or other matters likely affecting efficiency.

Based on his review of the billing statements and the auditors' outline of services, Jardini opined that, "given the way the case was handled and how much was being done in the way that it was done," the amount Pech had "already been paid" totaled "more than the reasonable value of the services."

After a nine-day trial and a single day of deliberation, the jury returned a general verdict in favor of defendants on all causes of action.

4. Post-trial Motions

Pech moved for a new trial. He principally argued the weight of the evidence compelled post-trial relief because Jardini was "[t]he only defense witness to testify that Defendants did not breach the . . . fee agreements," and Jardini's testimony was "insufficient to support the verdict." The gist of the argument was that Morgan had not disputed any of the billing statements (thus admitting breach, in Pech's telling) and Jardini's expert opinion was deficient for all the reasons Pech now raises on appeal (some of which we address later in this opinion).

Pech also moved for judgment notwithstanding the verdict.

The trial court rejected the argument, finding the weight of defendants' evidence (and Pech's testimony), apart from Jardini's opinion, was sufficient to support the jury's defense verdict. The court explained:

"The jury heard testimony from Plaintiff and Thang Le, and they saw Plaintiff's exhibits, including many emails with detailed statements of fees and costs. [Citation.] Lance Orloff, Adam Siegler, and Thomas Morgan also testified about their work with Plaintiff in the underlying case and Plaintiff's performance, including explaining how Plaintiff had refused to engage with the insurer, settle the case, and stop billing and preparing for trial when Morgan told him he wanted the case settled. The parties, especially Plaintiff, testified at length about presentations, charts, spreadsheets and videos Plaintiff and his staff created in the underlying case. The jury saw extensive, lengthy emails from Plaintiff to Defendants, and Plaintiff testified for three days, with long, repetitive explanations about irrelevant or tangential issues, providing a substantial basis for the jury to conclude that Plaintiff is far from succinct and efficient in performing legal services and takes many words and many minutes to make simple points. This evidence, apart from Jardini's testimony, provided a basis for the jury to conclude Plaintiff performed work that was not necessary, especially after Defendants told Plaintiff they needed to settle the case and hired new counsel. The testimony of Orloff and Siegler provided sufficient grounds for the jury to conclude Plaintiff's conduct was obstructionist and harmful to the resolution of the underlying case."

The court entered its order denying the post-trial motions. This appeal followed.

DISCUSSION

1. The Evidence Does Not Compel Judgment in Pech's Favor

"To establish a claim for breach of contract, a plaintiff must prove: (1) the existence of a contract, (2) plaintiff's performance or excuse for nonperformance, (3) defendant's breach, and (4) resulting damages to plaintiff." (Pech I, supra, 61 Cal.App.5th at p. 855.) In Pech I, we held an "attorney's performance" under a valid and enforceable fee agreement "must be consistent with the implied covenant of good faith and fair dealing." (Id. at p. 846.) Thus, to establish the second element of his breach of contract claim, an attorney suing his client for unpaid fees under a fee agreement bears the burden of proving he" 'used reasonable care, skill and diligence in performing the duties required of [him] under the contract, that unnecessary, duplicative or unproductive time [was] not charged to the client, and that [he] [did] not perform[ ] services that were required as a result of [his] negligence or some lack of ordinary skill or diligence.'" (Id. at pp. 852, 855.)

Pech's opening brief discusses only his causes of action for breach of the failure to maintain and insurance coverage fee agreements. Any arguments he may have raised with respect to his other claims are waived. (Reyes v. Kosha (1998) 65 Cal.App.4th 451, 466, fn. 6 ["Issues not raised in an appellant's brief are deemed waived or abandoned."].)

Pech says the issue raised in this appeal is whether "there [was] substantial evidence to support the jury verdict in favor of Morgan" on the causes of action for breach of the written fee agreements. It is true that we generally apply the familiar substantial evidence standard when an appeal challenges the sufficiency of the evidence to support a jury verdict. (See Janice H., supra, 1 Cal.App.5th at p. 597.) However, this test" 'is typically implicated when a defendant contends that the plaintiff succeeded at trial in spite of insufficient evidence. In the case where the trier of fact has expressly or implicitly concluded that the party with the burden of proof did not carry the burden and that party appeals, it is misleading to characterize the failure-of-proof issue as whether substantial evidence supports the judgment. This follows because such a characterization is conceptually one that allows an attack on (1) the evidence supporting the party who had no burden of proof, and (2) the trier of fact's unassailable conclusion that the party with the burden did not prove one or more elements of the case.'" (Valero v. Board of Retirement of Tulare County Employees' Assn. (2012) 205 Cal.App.4th 960, 965 (Valero), italics added; see Oldenburg v. Sears, Roebuck &Co. (1957) 152 Cal.App.2d 733, 742 [trier of fact is the exclusive judge of credibility and can reject evidence as unworthy of credence]; Hicks v. Reis (1943) 21 Cal.2d 654, 659-660 (Hicks) [trier of fact may reject the testimony of a witness entirely, even if that testimony is uncontradicted].)

Thus, where an appeal implicates the appellant's failure of proof at trial, the question for a reviewing court is more accurately characterized as" 'whether the evidence compels a finding in favor of the appellant as a matter of law.'" (Valero, supra, 205 Cal.App.4th at p. 966; Roesch v. De Mota (1944) 24 Cal.2d 563, 570-571; Caron v. Andrew (1955) 133 Cal.App.2d 402, 409.)" 'Specifically, the question becomes whether the appellant's evidence was (1) "uncontradicted and unimpeached" and (2) "of such a character and weight as to leave no room for a judicial determination that it was insufficient to support a finding" '" in the appellant's favor. (Valero, at p. 966, italics added; Roesch, at p. 571; Dreyer's Grand Ice Cream, Inc. v. County of Kern (2013) 218 Cal.App.4th 828, 838.)

Pech hardly addresses the character and weight of the evidence he offered to satisfy his burden of proving he" 'used reasonable care, skill and diligence in performing the duties required of [him]'" under the fee agreements. (Pech I, supra, 61 Cal.App.5th at pp. 852, 855.) To be sure, his opening brief asserts his team "used reasonable care, skill and diligence," but the only evidence he cites to support the assertion is the list of admitted trial exhibits, the plaintiffs' complaint in the failure to maintain case, and his own expert opinion testimony (offered in rebuttal to Jardini's opinion) without any of the underlying evidence that purportedly supported his opinion. This presentation is scarcely adequate to show Pech's evidence was"' "of such a character and weight as to leave no room for a judicial determination that it was insufficient to support a finding" '" in his favor, particularly in light of undisputed evidence showing Pech was paid over $1.1 million for his work under the fee agreements. (Valero, supra, 205 Cal.App.4th at p. 966; LA Investments, LLC v. Spix (2022) 75 Cal.App.5th 1044, 1062 [appellant bears burden of presenting adequate record establishing reversible error; failure to include adequate record citations triggers presumption that record supports jury verdict].)

Later in his brief, Pech purports to cite his "extensive testimony on the nature and extent of defending a failure to maintain lawsuit," but the only citation he provides (5 RT 43154357) is not part of the official reporter's transcript, which ends on page 2556. He also cites his billing records, trial brief, trial estimate, and a joint exhibit list for the failure to maintain case. However, the mere fact that work was performed is not proof that it was performed with" 'reasonable care, skill and diligence,'" let alone proof" 'that unnecessary, duplicative or unproductive time [was] not charged to the client.'" (Pech I, supra, 61 Cal.App.5th at p. 852.)

In any event, even if we assume Pech's evidence was sufficient to resist nonsuit (as the trial court determined), his appellate arguments are still fundamentally flawed because they fail to acknowledge or account for his burden of proof. Pech principally contends Jardini's expert opinion deserves no evidentiary weight because, in Pech's telling, Jardini did not provide a "reasoned explanation" tying his observations about Pech's dubious billing entries back to specific reductions totaling or exceeding the $821,846 that Pech claimed under the fee agreements. Jardini addressed this criticism on cross-examination. He explained that he based his opinion on a "comprehensive understanding" of the entire case, its value, the tasks performed, and the staff members involved, and he avoided focusing on "specific line item reduction[s] in isolation," which would have given Pech "the ultimate benefit of having written down" what amounted to inflated billing entries "in the first place." The problem for Pech is he did the same thing in presenting his case to the jury but, unlike Jardini or defendants, Pech had the burden of proof at trial.

Our review of the record confirms Pech made no attempt to demonstrate the reasonableness of specific line items in his billing statements. Instead, like Jardini, he testified about the general character of the two cases and summarized the tasks he and his team undertook, thereby attempting to prove his overall performance was reasonable and entitled him to damages for the unpaid fees in his billing statements. The bottom line is Pech cannot have it both ways. If Jardini's election to elide specific line-item deductions divests his opinion of evidentiary weight, then Pech's equivalent failure to justify specific line items in his billing statements constitutes a failure of proof and mandates a defense verdict. If, on the other hand, the holistic approach that both sides employed was sufficient to support a jury determination for either side, then Pech's criticism of Jardini's methodology fails to establish reversible error. We conclude the latter circumstance holds.

Pech also broadly attacks Jardini's testimony for failing to use the phrase "reasonable skill, care, or diligence" as set forth in Pech I. But, consistent with Pech I, Jardini made clear his opinion was not that Pech's "rates are unreasonable." (Italics added.) Rather, Jardini steadfastly focused on the tasks described in Pech's bills, the professionals who performed those tasks, and the time those professionals charged to complete those tasks. That focus follows the standard we articulated in Pech I, which requires the fact-finder" 'in reviewing the attorney's performance' under the fee agreement," to assess" 'whether the attorney used reasonable care, skill and diligence in performing the duties required of the attorney . . ., [so] that unnecessary, duplicative or unproductive time is not charged to the client.'" (Pech I, supra, 61 Cal.App.5th at p. 852.) As Pech acknowledges, the trial court properly instructed the jury to apply this standard in assessing his performance. The record Pech presents gives us no reason to doubt the jury followed this instruction in considering Jardini's ultimate opinion that "given the way that the case was handled and how much was being done in the way that it was done," the amount Pech had "already been paid" totaled "more than the reasonable value of the services" he rendered under the fee agreements.

Apart from his main criticisms, Pech makes several smaller objections to discrete aspects of Jardini's opinion. All suffer from the same essential defect-they fail to acknowledge Pech's burden of proof and thus present (at most) an evidentiary conflict. For example, Pech takes issue with Jardini highlighting the more than 80 depositions Pech's team took in the failure to maintain case. He contends any negative appraisal of this work was necessarily speculative because "Jardini did not review any deposition transcripts, PowerPoints or charts reflected in the billing statements."

As Pech points out, Jardini testified Pech's team took 89 depositions; however, the evidence shows eight of those depositions were taken by the counsel that preceded Pech in the failure to maintain case. The discrepancy does not make a difference to our resolution of the issue.

Contrary to Pech's argument, Jardini testified he did in fact review the charts and maps Pech's team prepared.

As Jardini explained to the jury, in view of the nature of the claims alleged in the failure to maintain case, it was "wasteful of legal talent and money" to take so many depositions, because all the plaintiffs were residents of the mobile home park and presented "similar situations." Based on his litigation experience, Jardini opined that Pech could have taken "a sample of people from various parts of the park" and arrived at a "pretty good idea" of what most of the plaintiffs would say, particularly as the plaintiffs likely were "all prepared by the lawyers" and were "going to say similar things." Pech's practice of sending two or three attorneys to every deposition (and billing for their preparation time as though his team had learned nothing from the previous depositions) increased the needless cost to the client. And, because the case would inevitably "turn on what the experts say" about whether the park was adequately maintained, Jardini testified it was "unreasonable" and wasteful to take so many plaintiff depositions.

Even without reviewing the deposition transcripts, Jardini's observations were reasonably based upon his review of the complaint in the failure to maintain case, Pech's billing records, and Jardini's experience litigating civil cases. The jury, of course, could consider Jardini's admission about the deposition transcripts and give his opinions whatever weight it saw fit. (See Kastner v. Los Angeles Metropolitan Transit Auth. (1965) 63 Cal.2d 52, 58 (Kastner).) The burden nevertheless rested with Pech to prove his decision to take more than 80 depositions (while assigning multiple attorneys to prepare for, travel to, and attend each deposition) was reasonable and not" 'unnecessary, duplicative or unproductive.'" (Pech I, supra, 61 Cal.App.5th at p. 852.) And, ultimately, it was for the jurors to decide whether to accept Pech's explanation or reject it, if in their judgment Jardini's reasoning was sound or Pech's explanation was lacking. (See Kastner, at p. 58.) Pech has not presented an adequate basis to set aside the jury's verdict.

Pech similarly objects to Jardini's testimony about the time Pech's team spent on the defense expert reports. Jardini noted Pech's team spent over 656 hours on tasks related to experts, more than half of which was spent preparing or revising the expert reports. As Jardini explained to the jury, these billing entries raised serious concerns about Pech's performance under the fee agreements, not only because the client was already paying the experts to prepare their reports, but also because it would be "a weakness" for the case if an expert were forced to disclose the lawyers prepared the report instead of the expert. Pech says Jardini "conjectured" because he "did not know the ages or computer skills" of the defense experts and did not see the reports they "initially prepared." Pech goes on to explain his firm prepared the final reports "because [one expert] was 87 years old" and the other was "in his 70's and it was far beyond their skill set to prepare a visual presentation for a jury." Jardini addressed this justification on cross-examination, explaining to the jury that, as lead defense counsel, Pech was responsible for "selecting the appropriate expert" and an attorney exercising reasonable care would "want [the expert] to do the work." This testimony was reasonably based on Jardini's long years of litigation experience and foreseeably would assist members of the jury in assessing whether Pech met his burden to prove he reasonably performed the legal services called for under the fee agreements. Pech's objection to Jardini's testimony does not establish grounds for reversal. (See Kastner, supra, 63 Cal.2d at p. 58.)

Pech makes similar arguments about other discrete aspects of Jardini's testimony. But as with the examples we have discussed, all the opinions that Pech characterizes as "conjecture" were reasonably based on Jardini's experience as a litigator and Pech's own billing statements describing the work he and his team performed. The jury had the billing statements and it had Pech's testimony explaining why, in his view, those tasks were reasonably undertaken. Ultimately it was Pech's burden to prove his performance was reasonable, and it was the jurors' task either to accept Pech's proof, or to reject it if they found Jardini's reasoning sound. By failing to acknowledge his burden of proof, Pech's arguments vainly attack" 'the trier of fact's unassailable conclusion that the party with the burden did not prove one or more elements of the case.'" (Valero, supra, 205 Cal.App.4th at p. 965; see Hicks, supra, 21 Cal.2d at pp. 659-660 ["Provided the trier of the facts does not act arbitrarily, he may reject in toto the testimony of a witness, even though the witness is uncontradicted."].)

This fundamental flaw runs through Pech's objections to the other defense evidence. As the trial court observed in its role as thirteenth juror, "Lance Orloff, Adam Siegler, and Thomas Morgan [all] testified about their work with [Pech] in the underlying case and [Pech's] performance, including explaining how [Pech] had refused to engage with the insurer, settle the case, and stop billing and preparing for trial when Morgan told him he wanted the case settled.... [This testimony] provided sufficient grounds for the jury to conclude [Pech's] conduct was obstructionist and harmful to the resolution of the underlying case." Pech cites evidence to explain his interactions with these defense witnesses, but we must presume the jury rejected these explanations in rendering a general verdict in defendants' favor. Nothing Pech has presented comes close to demonstrating the evidence compelled a finding in his favor" 'as a matter of law.'" (Valero, supra, 205 Cal.App.4th at p. 966.)

2. The Trial Court Enforced the in Limine Order; Pech Has Not Established Reversible Error

Defendants' insurance carrier for the failure to maintain case used a third-party auditing company called Legal-X to review Pech's billing statements before making payments under the policy. The record shows Pech submitted invoices to the carrier totaling $1,055,001.91; Legal-X issued a 1,079-page audit report identifying substantial reductions; and, based on the audit report, the carrier ultimately paid Pech $349,046.75. Pech moved in limine to exclude "all evidence, references to evidence, questions of any witness, and testimony of all witnesses" concerning the Legal-X audit report. The trial court granted the motion, concluding, "[e]xplaining the contents and conclusions of the 1,079-page report [was] likely to be misleading, confusing, and waste a substantial amount of time."

Pech contends defendants violated the in limine order by eliciting testimony related to the Legal-X audit report. He maintains these violations were so prejudicial as to compel reversal of the judgment because they "gave the jury a reasonable inference that outside, independent third parties . . . had evaluated Pech's billing statements and concluded . . . Pech had been overpaid." Pech correctly observes that the primary purpose of a motion in limine is to "avoid the obviously futile attempt to 'unring the bell'" when highly prejudicial evidence is offered and then stricken "in the proceedings before the jury." (Hyatt v. Sierra Boat Co. (1978) 79 Cal.App.3d 325, 337.) His argument is fundamentally flawed, however, because an opposing party's violation of an in limine order is not trial court error, but attorney misconduct, and the remedy for misconduct that cannot be cured by an admonition or instruction to the jury is a motion for mistrial. (People v. Lightsey (2012) 54 Cal.4th 668, 718 (Lightsey).) Pech did not move for a mistrial after any of the purported violations of the in limine order occurred. He thus forfeited this claim as a basis for reversal. (See, e.g., id. at p. 719 ["[D]efendant did not object or move for a mistrial based on asserted prosecutorial misconduct in violating the trial court's order. Accordingly, defendant forfeited this aspect of his claim."]; cf. Martinez v. Department of Transportation (2015) 238 Cal.App.4th 559, 561, 565, 570 [trial court's denial of motion for mistrial after opposing counsel's repeated prejudicial violations of in limine order was reversible error].)

In any event, the trial court would not have been obligated to declare a mistrial even if Pech had requested one. (See Lightsey, supra, 54 Cal.4th at p. 718 [trial court is vested with considerable discretion in ruling on mistrial motions].) Pech identifies four purported violations of the in limine order that he contends mandate reversal. The first occurred during Orloff's direct examination, when Orloff was asked to describe his "involvement in getting the payment to Mr. Pech." Orloff responded, "I reviewed the Legal-X reports . . . [a]nd then the carrier agreed . . . to pay Mr. Pech what Legal-X recommended that he be paid." Pech objected to the testimony, and the trial court struck the answer. We are satisfied the court reasonably determined this curative measure was sufficient. Orloff's mere mention of Legal-X is not the sort of "highly emotional or inflammatory language or reference to extremely prejudicial circumstances not in evidence" that a jury must be deemed incapable of disregarding "if so instructed." (Sabella v. Southern Pacific Company (1969) 70 Cal.2d 311, 320.)

Next, defense counsel asked Orloff if the carrier paid Pech "the million dollars or so that he wanted." Pech objected, and the trial court overruled his objection. Orloff responded, "The insurance company paid Mr. Pech close to $400,000." Neither the question nor the response violated the in limine order, and the court did not err in overruling Pech's objection. As defendants point out, no part of this exchange mentioned Legal-X or the audit report, and the amount paid by the carrier was reflected in Pech's own evidence.

Defense counsel then asked Orloff if, based on his "own analysis," he thought the insurer's payment was "an appropriate amount." Pech objected, and the trial court sustained the objection. The question did not directly reference the Legal-X audit report and the trial court's ruling prevented Orloff from referencing the report in his answer. Pech did not suffer the sort of prejudice necessary to mandate a mistrial. (See Lightsey, supra, 54 Cal.4th at p. 718.)

Finally, Pech takes issue with Morgan's response to a question Pech asked on cross-examination. During an exchange in which Pech sought to induce Morgan to admit he had not reviewed Pech's bills when he received them, Morgan responded, "We got two professionals, Legal-X and Mr. Jardini, both reviewed them and said you massively overbilled." Critically, Pech did not object to this testimony or move to strike it. Instead, he continued to question Morgan about Legal-X, asking, "Legal-X is an auditing company, right, for [the] insurance carrier; correct?" Absent an objection, we cannot set aside a verdict based on the admission of evidence, even if erroneous. (Evid. Code, § 353, subd. (a).) Pech has not met his burden to establish reversible error.

DISPOSITION

The judgment is affirmed. Defendants Thomas E. Morgan III; Juanita Springs Associates, LP; and Covina Hills MHC, LP are entitled to costs.

We concur: EDMON, P. J., ADAMS, J.


Summaries of

Pech v. Morgan

California Court of Appeals, Second District, Third Division
Dec 12, 2023
No. B317438 (Cal. Ct. App. Dec. 12, 2023)
Case details for

Pech v. Morgan

Case Details

Full title:RICHARD PECH, Plaintiff and Appellant, v. THOMAS E. MORGAN III et al.…

Court:California Court of Appeals, Second District, Third Division

Date published: Dec 12, 2023

Citations

No. B317438 (Cal. Ct. App. Dec. 12, 2023)