Justia California Court of Appeals Opinion Summaries

Cheryl Lynch, the owner of a residential property in San Clemente, California, engaged a general contractor for home improvement and repairs. The contractor hired Peter & Associates, Engineers, Geologists, Surveyors, Inc. (the Peter firm) to perform a geotechnical inspection of a footing trench. The Peter firm conducted a visual inspection and used a steel probe but did not perform subsurface exploration or laboratory testing. The footing later collapsed, causing significant damage to Lynch's home.Lynch filed a lawsuit in February 2021 against multiple parties, including the Peter firm, for breach of contract, nuisance, and negligence. The Peter firm moved for summary judgment, arguing it owed no duty of care to Lynch due to the lack of a direct contract. The Superior Court of Orange County granted the motion, heavily relying on the precedent set by Weseloh Family Ltd. Partnership v. K.L. Wessel Construction Co., Inc., which found no duty of care in the absence of privity.The Court of Appeal of the State of California, Fourth Appellate District, Division Three, reviewed the case. The court found that the Peter firm failed to meet its burden in the summary judgment motion. The court held that the firm owed a duty of care to Lynch, applying the Biakanja factors, which consider the extent to which the transaction was intended to affect the plaintiff, the foreseeability of harm, and other factors. The court also found that the trial court erred in dismissing Lynch's nuisance claim and in sustaining the Peter firm's evidentiary objections without proper basis.The Court of Appeal reversed the summary judgment and remanded the case to the trial court with instructions to deny the Peter firm's motion in its entirety. View "Lynch v. Peter & Associates" on Justia Law

American Building Innovation LP (ABI) was hired by Balfour Beatty Construction, LLC (Balfour Beatty) as a subcontractor for a school construction project. ABI had a workers’ compensation insurance policy when it began work, but the policy was canceled due to ABI’s refusal to pay outstanding premiums from a previous policy. This cancellation led to the automatic suspension of ABI’s contractor’s license. Despite knowing it was unlicensed and uninsured, ABI continued working on the project.The Superior Court of Orange County found that ABI was not duly licensed at all times during the performance of its work, as required by California law. ABI’s license was suspended because it failed to maintain workers’ compensation insurance. ABI later settled its premium dispute and had the policy retroactively reinstated, but the court found this retroactive reinstatement meaningless because it occurred long after the statute of limitations for any workers’ compensation claims had expired. The court ruled that ABI could not maintain its action to recover compensation for its work due to its lack of proper licensure.The California Court of Appeal, Fourth Appellate District, Division Three, affirmed the lower court’s judgment. The court held that ABI was not entitled to retroactive reinstatement of its license because the failure to maintain workers’ compensation insurance was not due to circumstances beyond ABI’s control. ABI’s decision not to pay the premiums and its false representations to the Contractors’ State License Board were within its control. Consequently, ABI was barred from bringing or maintaining the action under section 7031 of the Business and Professions Code. The court also affirmed the award of attorney fees to Balfour Beatty under the subcontract’s prevailing party attorney fee provision. View "American Building Innovations v. Balfour Beatty Construction" on Justia Law

In this case, the plaintiff purchased a new 2014 Kia Optima and soon experienced issues with the vehicle's reverse gear. Despite multiple visits to the dealership, the problem persisted. The plaintiff requested a buyback from Kia Motors America, Inc. (Kia), but Kia's investigations, including installing a flight recorder, did not confirm the defect. Kia eventually offered to repurchase the vehicle, but the plaintiff rejected the offer and continued to use the car until filing a lawsuit under California’s Song-Beverly Consumer Warranty Act (the Act).The Superior Court of Los Angeles County found in favor of the plaintiff, awarding restitution and a civil penalty for Kia's willful violation of the Act. Kia filed posttrial motions challenging the restitution amount and the civil penalty. The court partially granted Kia's motions, striking the civil penalty for insufficient evidence but denying the motion to reduce the restitution amount.The California Court of Appeal, Second Appellate District, reviewed the case. The court held that the restitution award should not include the cost of the optional service contract, certain insurance premiums, and other specific amounts. The court affirmed the trial court's decision to grant a new trial on the civil penalty, finding substantial evidence that Kia may have had a good faith and reasonable belief that the vehicle was not defective.The appellate court directed the trial court to amend the judgment to exclude the non-recoverable amounts from the restitution award and to conduct a new trial on the civil penalty, limited to the period before the lawsuit was filed. The court clarified that a violation of the Act is willful only if it is deliberate, knowing, or not based on a good faith and reasonable belief of compliance. View "Valdovinos v. Kia Motors America, Inc." on Justia Law

Payam Mahram used Instacart to purchase groceries from a grocery store and later sued the store, alleging it had cheated him on price. The grocery store, not a party to the Instacart contract, moved to compel arbitration based on the arbitration agreement between Mahram and Instacart. The trial court denied the motion, and the grocery store appealed.The Los Angeles County Superior Court initially reviewed the case and denied the grocery store's motion to compel arbitration without providing a written explanation. The grocery store then appealed this decision to the California Court of Appeal, Second Appellate District.The California Court of Appeal affirmed the lower court's decision. The court held that while Mahram did agree to arbitration with Instacart by signing up for its service, the grocery store was not a third-party beneficiary of that agreement. The court determined that the trial court, rather than an arbitrator, was the proper authority to decide the threshold questions of arbitrability because the contract did not clearly indicate that Mahram had agreed to arbitrate with anyone other than Instacart. Additionally, the court found that the grocery store was not a third-party beneficiary of the Instacart-Mahram arbitration contract, as the contract's motivating purpose was not to benefit the grocery store. Consequently, the grocery store could not compel arbitration based on the Instacart agreement. The order denying the motion to compel arbitration was affirmed, and costs were awarded to the respondent. View "Mahram v. The Kroger Co." on Justia Law

In 2017, Riverside Mining Limited (Riverside Mining) leased 73 acres of its property to Quality Aggregates (Quality) for mining. By 2020, disputes arose, leading Quality to sue Riverside Mining in 2021 for breach of contract, trespass, and quiet title. In 2022, Riverside Mining filed an unlawful detainer action to evict Quality for alleged lease breaches. The parties agreed that Quality would deposit monthly rent payments with the court during the litigation. Quality later made a settlement offer under Code of Civil Procedure section 998, which Riverside Mining did not accept. Riverside Mining then dismissed the unlawful detainer action without prejudice.The Superior Court of Riverside County dismissed the unlawful detainer action and later addressed two motions: Quality's motion for attorney fees under section 998 and Riverside Mining's motion to disburse the deposited rent payments. The court denied Quality's motion for attorney fees and granted Riverside Mining's motion for disbursement.The California Court of Appeal, Fourth Appellate District, reviewed the case. The court affirmed the lower court's decisions. It held that Quality was not entitled to attorney fees under section 998 because Civil Code section 1717, subdivision (b)(2), precludes awarding attorney fees when an action is voluntarily dismissed. The court also affirmed the disbursement of the deposited funds to Riverside Mining, as Quality had no right to a setoff for attorney fees. The court's main holding was that section 998 does not independently authorize attorney fees without an underlying statutory or contractual right, and Civil Code section 1717, subdivision (b)(2), prevents such an award in cases of voluntary dismissal. View "Riverside Mining Limited v. Quality Aggregates" on Justia Law

Bijan Boutiques, LLC (Bijan) appealed a summary judgment in favor of Rosamari Isong. Bijan sought to void the property distribution in the marital dissolution judgment between Isong and her former husband, Richard Milam Akubiro, under the Uniform Voidable Transactions Act (UVTA). Bijan argued that the judgment was fraudulent as it awarded Isong the couple’s only U.S. property, making it difficult to enforce a judgment Bijan had against Akubiro without incurring significant expenses to pursue foreign assets.The Superior Court of San Bernardino County ruled that Bijan’s complaint was barred by Family Code section 916, subdivision (a)(2), which protects property received in a marital dissolution from being liable for a spouse’s debt unless the debt was assigned to the receiving spouse. The court found that the marital dissolution judgment was not a product of a negotiated settlement but was adjudicated by the court, thus not subject to the UVTA.The California Court of Appeal, Fourth Appellate District, Division Three, affirmed the lower court’s decision. The appellate court held that Family Code section 916 precludes Bijan from enforcing its judgment against the property awarded to Isong. The court distinguished this case from Mejia v. Reed, which allowed UVTA claims against marital settlement agreements, noting that the dissolution judgment here was court-adjudicated, not a private agreement. The court also rejected Bijan’s arguments that the judgment was obtained by fraud and that the Chino property should not have been subject to division, affirming that the property was presumed to be community property under Family Code section 2581.The appellate court concluded that Bijan could not satisfy its judgment against Akubiro by executing on the property awarded to Isong and affirmed the summary judgment in favor of Isong. View "Bijan Boutiques v. Isong" on Justia Law

Farzam Salami received emergency services at Los Robles Regional Medical Center on three occasions in 2020. He signed a conditions of admission contract agreeing to pay for services rendered, as listed in the hospital's chargemaster. Los Robles billed him for these services, including a significant emergency services fee (EMS fee). Salami paid part of the discounted bill but disputed the EMS fee, claiming it covered general operating costs rather than services actually rendered. He argued that had he known about the EMS fee, he would have sought treatment elsewhere.Salami sued Los Robles in December 2021 for breach of contract and declaratory relief. The trial court sustained Los Robles's demurrer to the first amended complaint (FAC), finding that Salami did not allege he performed his duties under the contract or that Los Robles failed to perform its duties. The court also found that the breach of contract claim could not be cured by amendment. Salami was granted leave to amend to assert claims under the Unfair Competition Law (UCL) and Consumers Legal Remedies Act (CLRA). In his third amended complaint (TAC), Salami alleged that Los Robles failed to disclose the EMS fee adequately.The Court of Appeal of the State of California, Second Appellate District, Division Six, reviewed the case. The court affirmed the trial court's decision, holding that Los Robles had no duty to disclose the EMS fee beyond including it in the chargemaster. The court referenced recent cases, including Moran v. Prime Healthcare Management, Inc., which held that hospitals are not required to provide additional signage or warnings about EMS fees. The court concluded that Los Robles complied with its statutory and regulatory obligations, and Salami's claims under the UCL and CLRA failed as a result. The judgment in favor of Los Robles was affirmed. View "Salami v. Los Robles Regional Medical Center" on Justia Law

In this case, a law firm (HFM) appealed a trial court's judgment denying its third-party claim to $585,000 held in its client trust account. The funds were received from HFM's client, Mann, under a flat fee agreement for future legal services. Mann's judgment creditor, Dickson, served HFM with a notice of levy, asserting that the funds belonged to Mann. HFM contended that the funds belonged to it under the flat fee agreement.The Superior Court of San Diego County denied HFM's third-party claim, concluding that the funds belonged to Mann because HFM had not yet earned the fee by providing legal services. The court also denied HFM's motion for reconsideration, which sought to retain $53,457.95 of the funds based on a prior agreement with Mann. The court found that HFM failed to present this evidence initially and did not act with reasonable diligence.The Court of Appeal, Fourth Appellate District, Division One, State of California, affirmed the trial court's judgment. The appellate court held that under the Rules of Professional Conduct, a flat fee is not earned until legal services are provided, and HFM presented no evidence that it had performed any services under the agreement. The court also found that the location of the funds in the client trust account was not dispositive of ownership. Additionally, the appellate court upheld the trial court's denial of the motion for reconsideration, noting that HFM failed to provide a satisfactory explanation for not presenting the evidence earlier.The main holding is that a flat fee paid in advance for legal services is not earned until the services are provided, and funds in a client trust account are presumed to belong to the client unless the law firm can prove otherwise. The judgment denying HFM's third-party claim was affirmed. View "Dickson v. Mann" on Justia Law

Jill and Grant Wiese were married for nearly 30 years before their marriage was dissolved in 2016. They had a premarital agreement (PMA) that kept their assets and earnings separate, with Grant responsible for reasonable support. Jill worked as an independent agent for Grant’s real estate brokerage, receiving 100% of her commissions after deductions for business expenses and estimated taxes. Grant deducted amounts for taxes and personal expenses he believed exceeded his support obligations, but the tax deductions did not match the actual taxes paid, and he did not refund the excess to Jill.The Superior Court of Orange County found the PMA valid and enforceable. Jill then brought claims against Grant for breach of fiduciary duty, arguing that his deductions from her commissions were excessive and impaired her separate property. Grant countered that Jill’s claims were time-barred and meritless. The trial court ruled in Jill’s favor on the tax-withholding claims, awarding her over $1.3 million, but rejected her other claims. Both parties appealed.The California Court of Appeal, Fourth Appellate District, reviewed the case. It held that Jill’s fiduciary duty claims were subject to a four-year statute of limitations and that most were time-barred. For the surviving claims, the court found Grant breached his fiduciary duty by withholding excessive amounts for taxes but erred in awarding Jill the entire amount withheld rather than the excess. The court also found that Grant’s deductions for personal expenses required reconsideration. It affirmed that Grant was solely liable for the mortgage debt on their jointly owned property but reversed the order requiring Jill to reimburse Grant for housing during their separation. The court remanded for further proceedings, including recalculating damages and reconsidering attorney fees. View "Marriage of Wiese" on Justia Law

The case revolves around a dispute over a public contract for services to be rendered to the state. The plaintiffs, Talley Amusements, Inc. and others, alleged that the 32nd District Agricultural Association and others violated the Public Contract Code section 10339 when they solicited proposals for a master carnival operator contract for the county fair. The plaintiffs claimed that the request for proposal (RFP) was written in such a way that only one carnival operator in the United States could qualify, thereby limiting the bidding process.The Superior Court of Orange County initially reviewed the case. The court found that section 10339, which prohibits a state agency from drafting an RFP in a way that directly or indirectly limits bidding to any one bidder, did not apply to this particular contract. As a result, the court denied the plaintiffs' request for a temporary injunction under section 10421, which allows a court to issue a temporary injunction preventing further dealings on a public contract awarded in violation of section 10339.The case was then brought before the Court of Appeal of the State of California Fourth Appellate District Division Three. The main issue on appeal was whether the competitive bidding requirements of section 10339 apply to a district agricultural association’s RFP on a master carnival contract. After reviewing the matter de novo, the court held that section 10339 did not apply to the contract at issue because it was not a contract for services to be rendered to the state. Therefore, the court affirmed the trial court’s order denying injunctive relief under section 10421. View "Talley Amusements v. The 32nd District Agricultural Association" on Justia Law