Opinion
B226643
10-27-2011
MICHAELINE A. RE, Plaintiff and Respondent, v. JENNY SHPIRT, Defendant and Appellant.
Law Offices of Jilbert Tahmazian, Jilbert Tahmazian and Laura C. Crawford for Defendant and Appellant. Furutani & Peters and John A. Furutani for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
(Los Angeles County Super. Ct. No. GC042468)
APPEAL from a judgment of the Superior Court of Los Angeles County. Jan A. Pluim, Judge. Affirmed.
Law Offices of Jilbert Tahmazian, Jilbert Tahmazian and Laura C. Crawford for Defendant and Appellant.
Furutani & Peters and John A. Furutani for Plaintiff and Respondent.
Jenny Shpirt (appellant) appeals from a judgment entered in favor of Michaeline A. Re (respondent) after the trial court granted respondent's motion for summary adjudication on respondent's claims of breach of contract and common counts. We affirm.
CONTENTIONS
Appellant contends that the trial court erred in granting summary adjudication to respondent on her claims of breach of contract and common counts. Specifically, appellant contends that: (1) the written attorney fee agreement between the parties was voidable, therefore respondent was only entitled to recover quantum meruit; (2) respondent did not fulfill her responsibilities under the agreement, therefore she was not entitled to the full contingency; (3) appellant was not a proper party to the action below; and (4) the entire action was improper and should not have proceeded to summary judgment because respondent never provided appellant with notice of her right to request fee arbitration as required by Business and Professions Code section 6201, subdivision (a).
BACKGROUND
On April 5, 2004, appellant entered into a written fee agreement with respondent. Respondent, a licensed California attorney, was retained to perform certain legal services for appellant and her husband, the owners of Greybor Medical Transportation, Inc. Respondent performed all legal services for appellant pursuant to the written retainer agreement.
One of the matters covered by the fee agreement was a matter captioned Greybor Medical Transportation, Inc. v. T & N Medical Transport, Inc., Los Angeles Superior Court case No. BC336867 (the Greybor matter). Judgment in the Greybor matter was entered in favor of appellant and Greybor Medical Transportation, Inc. on January 22, 2007. Pursuant to the written retainer agreement, respondent had a 40 percent contingency interest in the amounts collected. However, at the time that she filed her summary judgment motion, respondent had not received any funds for her contingency interest in the case.
Appellant advised respondent in 2009 that she took all of the money collected as a result of the above-referenced judgment.
As of January 2009, respondent was due $161,997.46 from appellant based on a contingency fee of 40 percent of the $309,302.33 collected in the Greybor matter plus $38,276.53 of hourly fees and costs due pursuant to respondent's January 9, 2009 invoice.
PROCEDURAL HISTORY
Respondent instituted an action against appellant on March 2, 2009, asserting causes of action for breach of contract, common counts, and fraud. Respondent alleged that appellant and her husband failed to pay respondent $161,876.53 for legal services provided to appellant and her husband.
On April 13, 2009, appellant filed an answer to the complaint and also filed a cross-complaint for legal malpractice.
In discovery, appellant confirmed that on December 2 and December 4, 2008, appellant received funds in which respondent had a contingent interest. Appellant's response to Special Interrogatory No. 5 stated that appellant had received $309,000 on cases covered by the fee agreement between the parties.
On February 16, 2010, respondent filed a motion for summary judgment, seeking summary judgment on the cross-complaint and summary adjudication on the first and third causes of action in the complaint. On April 28, 2010, appellant filed an opposition to the summary judgment/summary adjudication motion. Appellant did not file an opposing declaration.
The matter was heard on May 12, 2010. The court took the matter under submission, but entered a minute order later the same day granting respondent's motion in full. As to the cross-complaint for legal malpractice, the court found that respondent had presented evidence demonstrating that in each case named in the cross-complaint, either appellant was not a party and therefore had no standing to prosecute a malpractice claim, or that the claim was time-barred. Appellant had presented no evidence demonstrating the existence of a triable material fact on these issues.
The summary judgment on appellant's cross-complaint for legal malpractice is not raised in this appeal.
As to respondent's causes of action for breach of contract and common counts, the court found that respondent had presented evidence of an attorney fee agreement, performance, and money owed. Appellant failed to present evidence raising a triable issue of material fact regarding these issues or as to whether she was a party to the lawsuits for which respondent sought payment. The retainer agreement did not require respondent to engage in collection activity as a condition precedent to being paid. Respondent established her entitlement to $161,997.46. Appellant's objections were overruled.
On May 13, 2010, the trial court signed an order granting the motion for summary judgment and summary adjudication.
On May 14, 2010, respondent dismissed defendants Boris Shpirt and Does 1 to 10 without prejudice, and also dismissed the complaint's second cause of action without prejudice.
On June 4, 2010, the trial court issued a judgment in favor of respondent and against appellant in the total amount of $181,387.14.
Notice of entry of judgment was filed on June 7, 2010. On August 6, 2010, appellant filed her notice of appeal.
DISCUSSION
I. Standard of Review
The standard of review for an order granting or denying a motion for summary judgment or adjudication is de novo. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 860 (Aguilar).) The trial court's stated reasons for granting summary relief are not binding on the reviewing court, which reviews the trial court's ruling, not its rationale. (Kids' Universe v. In2Labs (2002) 95 Cal.App.4th 870, 878.)
A party moving for summary judgment "bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law." (Aguilar, supra, 25 Cal.4th at p. 850, fn. omitted.) "There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof." (Ibid., fn. omitted.) "A defendant bears the burden of persuasion that 'one or more elements of the 'cause of action' in question 'cannot be established,' or that 'there is a complete defense' thereto. [Citation.]" (Ibid.)
Generally, "the party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact. . . . A prima facie showing is one that is sufficient to support the position of the party in question. [Citation.]" (Aguilar, supra, 25 Cal.4th at pp. 850-851.)
II. Respondent carried her burden of showing the nonexistence of a triable issue of material fact on the relevant causes of action
In analyzing respondent's motion for summary adjudication, we first address respondent's initial burden to show that there was no triable issue of material fact and that she was entitled to judgment as a matter of law. We address each cause of action separately below, and find that respondent carried her initial burden.
A. Breach of contract
The elements of a cause of action for breach of contract are: (1) existence of the contract; (2) performance by the plaintiff or excuse for nonperformance; (3) breach by the defendant; and (4) damages. (First Commercial Mortgage Co. v. Reece (2001) 89 Cal.App.4th 731, 745.)
Respondent presented undisputed evidence that on April 5, 2004, respondent and appellant entered into a written fee agreement. Appellant agreed to pay respondent an hourly rate of $200 per hour plus an escalating contingency fee. Respondent performed all legal services required pursuant to the written agreement.
Respondent presented undisputed evidence that as of January 9, 2009, appellant owed respondent $38,276.53 for costs and fees incurred on the hourly rate portion of the agreement. In addition, through interrogatory responses provided by appellant, respondent showed that she held a contingent interest in the Greybor matter, and that in December 2008, appellant received $309,302.33 in execution of judgment in that case.
Despite respondent's request, appellant refused to pay respondent her share of the proceeds from the Greybor matter and the fees due under the agreement.
Based on appellant's breach of the written fee agreement, respondent was damaged in a total amount of $161,997.46.
The evidence presented by respondent, discussed above, adequately sets forth a prima facie case for breach of contract.
B. Common counts
The elements of a common count are "'(1) the statement of indebtedness in a certain sum, (2) the consideration, i.e., goods sold, work done, etc., and (3) nonpayment.' [Citation.]" (Farmers Ins. Exchange v. Zerin (1997) 53 Cal.App.4th 445, 460.)
As described above, respondent presented undisputed evidence that indebtedness existed between respondent and appellant; that respondent performed the legal services which were consideration for the amounts stated; and that appellant failed to pay the amounts due.
The evidence presented by respondent thus adequately set forth a prima facie case for common counts for hourly wages and contingency fees owed to her.
III. Appellant failed to present a triable issue of material fact as to the relevant causes of action
We have determined that respondent met her initial burden. She set forth a prima facie case showing the nonexistence of a triable issue of material fact as to each of the two relevant causes of action. Therefore, the burden shifts to the opposing party to make a prima facie showing of the existence of a triable issue of material fact. (Aguilar, supra, 25 Cal.4th at pp. 850-851.) As discussed below, appellant has failed to meet this burden.
A. Voidable contract
Appellant's first argument is that the contract between the parties is voidable. Appellant sets forth the contents of Business and Professions Code section 6147 (section 6147), which outlines the requirements as to the information which must be included in a contingency fee agreement. Appellant argues that the contract between the parties violates section 6147 in that it does not set out how disbursements incurred in connection with the claim are to be made, and it does not state that the fee is negotiable. (§ 6147, subds. (a)(2) & (a)(4).)
The requirements of section 6147 also apply to hybrid agreements such as the one between the parties. (Arnall v. Superior Court (2010) 190 Cal.App.4th 360, 371 (Arnall).)
--------
Section 6147, subdivision (b) provides that "[f]ailure to comply with any provision of this section renders the agreement voidable at the option of the plaintiff, and the attorney shall thereupon be entitled to collect a reasonable fee." Appellant argues that the fee agreement was voidable under section 6147, and therefore summary adjudication should not have been granted.
With this argument, appellant challenges the first element of respondent's cause of action for breach of contract: the existence of an enforceable contract. Although appellant does not articulate the challenge as such, we infer that appellant intends to argue that because the contract is voidable pursuant to section 6147, subdivision (b), it is in fact void.
Appellant has not set forth any evidence showing that she has taken advantage of the option available to a client under section 6147, subdivision (b). Appellant did not seek to have the agreement declared void, either in a separate proceeding or in this proceeding. Appellant has presented to no evidence that she intended to treat the agreement as void at any time during the parties' relationship. She did not cite section 6147, subdivision (b) as an affirmative defense to respondent's complaint nor as a basis for her cross-complaint. The fact that the agreement is voidable does not undermine its existence, and at no time did appellant seek to have the agreement declared void.
Arnall is distinguishable for this reason. In Arnall, "petitioners terminated [their attorney's] services and averred that the service agreements were void under [section 6147]" over seven months before the attorney sued them for breach of contract. (Arnall, supra, 190 Cal.App.4th at p. 363, fn. omitted.) Similarly, in Fergus v. Songer (2007) 150 Cal.App.4th 552, the court found that the client implicitly voided an unsigned letter agreement at the time that he expressly voided a prior oral contingency fee agreement. (Id. at p. 570.)
The fact that the agreement between the parties is voidable under section 6147 is insufficient to defeat summary adjudication in the circumstances of this case. "A voidable contract is one which may be rendered null at the option of one of the parties, but is not void until so rendered. [Citation.]" (Depner v. Joseph Zukin Blouses (1936) 13 Cal.App.2d 124, 127.) Appellant has presented no evidence that she ever opted to void the contract, nor does she seek to do so in this lawsuit. Thus, the undisputed evidence shows that the contract remains valid and enforceable.
B. Quantum meruit
Appellant argues that when an agreement is voidable, an attorney may only recover quantum meruit. As set forth above, the attorney's right to collect "a reasonable fee," as opposed to the contractually agreed upon amount, arises when the contract is declared void -- not when it is merely voidable. (§ 6147, subd. (b); Arnall, supra, 190 Cal.App.4th at p. 363; Fergus v. Songer, supra, 150 Cal.App.4th at p. 570.)
However, even if appellant had taken advantage of the enforcement provision of section 6147 and sought to void the contract, appellant has presented absolutely no evidence that a quantum meruit payment should be any less than the amount that the parties contracted for. Appellant has presented no evidence that respondent failed to complete the work contemplated under the contract. Appellant has presented no evidence that the work was poor quality. Appellant has presented no evidence that the terms of the contract were unreasonable. Appellant has failed to present any evidence whatsoever to contradict respondent's evidence that she was owed $161,997.46 for services rendered. Under the circumstances, even if the agreement were declared void, the trial court would not have erred in assuming that the amount requested by respondent was a "reasonable fee" as set forth in section 6147.
C. Failure to fulfill contractual responsibilities
Appellant next argues that a "reasonable interpretation" of the agreement between the parties "would suppose that [respondent] had to collect the proceeds of the Greybor action in order to collect her portion." Appellant argues that because she retained independent counsel to undertake collection, respondent did not fulfill her duties under the contract.
We agree with the trial court's interpretation of the contract between the parties. Respondent's services specifically consisted of "the preparation of all legal documents for court proceedings, and/or settlement agreements, conferences, consultations with you and accountants, appraisers, actuaries, and other persons necessary to a resolution of any issues raised during the proceedings, plus telephone conferences, legal research and correspondence." Appellant points to no specific language suggesting that respondent would undertake collection activity as a condition precedent to getting paid. No such language exists in the agreement.
Appellant also makes the vague references to the fact that "clients may discharge their attorneys at any time," and "[d]ischarged attorneys are entitled to recover only for services rendered up to the point of the termination." Never does appellant argue that she in fact discharged respondent at any time. The undisputed facts show otherwise.
In sum, appellant has failed to create a triable issue of fact as to whether respondent fulfilled her contractual obligations.
D. Appellant is a proper party to this action
Appellant argues that because she did not sign the retainer agreement as a representative of Greybor, she was not a proper party from whom respondent could recover fees in the Greybor matter. Appellant argues that only Boris Shpirt signed the retainer agreement on behalf of Greybor, therefore he was the only individual against whom respondent could proceed for the contingent fees.
The undisputed evidence shows that appellant was a party to the Greybor matter. Respondent presented evidence that she represented appellant and Greybor in that action, and that judgment was entered in favor of both appellant and Greybor. In addition, the evidence shows that the money collected as a result of the favorable outcome in the Greybor matter was paid directly to appellant -- not Greybor. Appellant has presented no evidence suggesting that she was not a party to the relevant case or that she did not collect the judgment in her favor. The fact that she did not sign the retainer agreement as a representative of Greybor is irrelevant, since she signed the retainer agreement personally.
Appellant has failed to present evidence creating a triable issue of fact as to whether she is a proper party to this case.
E. Written notice of the client's right to request fee arbitration
For the first time on appeal, appellant argues that respondent failed to provide her with a written notice of her right to request arbitration, pursuant to Business and Professions Code section 6201, subdivision (a). Under that section, at the time an attorney presents a summons or claim to a client in an action against the client, the attorney must also provide written notice of the client's right to arbitration under article 13 of that chapter. Failure to give such notice "shall be a ground for the dismissal of the action." (§ 6201, subd. (a).)
Appellant never brought this issue to the attention of the trial court and never sought dismissal of the action on this or any other ground. Parties are precluded from raising on appeal issues that were not raised before the trial court. (In re Riva M. (1991) 235 Cal.App.3d 403, 411-412.) "[T]o permit [a party] to do so would not only be unfair to the trial court but manifestly unjust to the opposing litigant. [Citation.]" (Sierra Club, Inc. v. California Coastal Com. (1979) 95 Cal.App.3d 495, 503.) By raising this issue for the first time on appeal, appellant has prevented respondent from presenting evidence that she did provide the requisite notice.
In addition, even if respondent did not provide the requisite notice, the decision as to whether to dismiss a case due to an attorney's failure to comply with Business & Professions Code section 6201, subdivision (a), is a discretionary decision on the part of the trial court. (Law Offices of Dixon R. Howell v. Valley (2005) 129 Cal.App.4th 1076, 1088 ["the court may, in its discretion, dismiss the action for attorney fees where the attorney fails to give the client the requisite section 6201(a) notice" (original italics)].) Thus, the trial court must weigh facts and consider the prejudice to each side in determining the most equitable solution. (Howell, at p. 1089.) This discretion is unique to the trial court and should not be undertaken for the first time on appeal.
Where a new theory first presented on appeal "contemplates a factual situation . . . not put in issue or presented at the trial the opposing party should not be required to defend against it on appeal. [Citations.]" (Panopulos v. Maderis (1956) 47 Cal.2d 337, 341.) Appellant forfeited this issue by failing to raise it in the trial court. (People v. Thornton (2007) 41 Cal.4th 391, 427.) Therefore we decline to address it further.
DISPOSITION
The judgment is affirmed. Respondent is entitled to her costs of appeal. NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
CHAVEZ, J. We concur: DOI TODD, Acting P. J. ASHMANN-GERST, J.