Summary
rejecting the proposition that a corporate employer can rely on section 2865 to bring a professional negligence claim against the employer's inhouse counsel
Summary of this case from Erhart v. BofI Holding, Inc.Opinion
NOT TO BE PUBLISHED
APPEALS from a judgment and an order of the Superior Court for the County of Los Angeles, No. BC 341913, Jane L. Johnson, Judge.
Larry M. Hoffman for Plaintiff, Cross-defendant and Appellant 1538 Cahuenga Partners, LLC.
Jacqueline M. Fabe, in pro. per.; Marshall A. Lerner for Defendant, Cross-complainant and Appellant Jacqueline M. Fabe.
David Lawrence Bell, Department of Industrial Relations, Division of Labor Standards Enforcement, for Plaintiff and Respondent California State Labor Commissioner.
GRIMES, J.
SUMMARY
Jacqueline Fabe is a lawyer who was hired by 1538 Cahuenga Partners, LLC (Cahuenga), in February 2005 as an employee for an agreed monthly salary. After one month, when Cahuenga did not pay her at the agreed rate, she quit and filed a claim with the California State Labor Commissioner (the Commissioner) for her unpaid wages. The Commissioner notified Cahuenga of Fabe’s claim, and one month later, Cahuenga and its principal, Ron Hacker, sued Fabe for legal malpractice and other claims (the malpractice lawsuit). Fabe then filed a discrimination complaint with the Commissioner, contending she was sued in retaliation for filing her wage claim.
Fabe prevailed on her wage claim and prevailed on her retaliation claim, after which the Commissioner sued Cahuenga, seeking a cease and desist order and damages (in the form of Fabe’s defense costs) for Cahuenga’s illegal retaliation against Fabe (the Commissioner’s retaliation action).
The malpractice lawsuit and the Commissioner’s retaliation action were consolidated, and Fabe filed a cross-complaint against Cahuenga in the malpractice lawsuit, seeking indemnity for her legal expenses under Labor Code section 2802. Fabe and the Commissioner prevailed in these actions, too. First, the trial court sustained Fabe’s demurrer to the professional negligence claim without leave to amend, taking the view that, as a matter of law, an employer cannot sue its own employee for negligence. Second, Fabe obtained summary judgment on Cahuenga’s only other cause of action, for breach of fiduciary duty. Third, after a court trial, the court awarded the Commissioner fees and costs of $232,435.50 (and a cease and desist order) in the retaliation action, and awarded Fabe a judgment on her indemnity claim for costs and fees of $101,078 incurred in defending against Ron Hacker’s claims (to be offset against any recovery in the Commissioner’s retaliation action).
All statutory citations are to the Labor Code unless otherwise specified.
Cahuenga’s principal contention on appeal is that the trial court erred when it sustained Fabe’s demurrer to its professional negligence claim as a matter of law. This error, Cahuenga asserts, infected the judgment for the Commissioner as well, because no evidence was adduced at trial to support a finding that the malpractice lawsuit was frivolous (and even if there were such evidence, Cahuenga contends, filing a frivolous lawsuit against a former employee is not actionable under section 98.6). Cahuenga also contends the award to Fabe on her indemnity claim was improper, and that the judgments for Fabe and the Commissioner were excessive because Fabe cannot recover legal fees for time spent representing herself. Fabe also appealed from a postjudgment order correcting the judgment and quashing an abstract of judgment Fabe had filed.
We are not persuaded that the trial court erred in sustaining Fabe’s demurrer to Cahuenga’s professional negligence claim, and in any event, dismissal of the professional negligence claim had no effect on the judgment in the Commissioner’s retaliation action. Contrary to Cahuenga’s assertions, the Commissioner did not have the burden to prove Cahuenga’s retaliatory malpractice lawsuit was also frivolous. The Commissioner produced substantial evidence of retaliation. Cahuenga’s failure to produce evidence it had legitimate reasons for filing the malpractice lawsuit, both during the administrative proceedings and later before the trial court, led to judgment in the Commissioner’s favor. Further, we reject Cahuenga’s contention that a retaliatory lawsuit against a former employee is not actionable under section 98.6.
We also affirm the award to the Commissioner, and find any error in awarding attorney’s fees to Fabe on her indemnity claim was harmless. Finally, there was no error in the postjudgment order quashing the abstract of judgment.
FACTS
Fabe was hired by Cahuenga Partners in February 2005 as an employee for an agreed monthly salary of $6,000, to be paid every two weeks. Fabe quit after one month because Cahuenga Partners had paid her only $2,000, and had asked her to sign a document she thought she had no authority to sign. Fabe filed a claim with the Commissioner for her unpaid wages. She eventually obtained an award of $12,824.66 (wages, interest and waiting time penalties).
Shortly after the Commissioner notified Cahuenga of Fabe’s wage claim, Cahuenga Partners and Ron Hacker filed the malpractice lawsuit against Fabe. Fabe complained to the Commissioner, who decided the malpractice lawsuit was filed in retaliation for Fabe’s filing of her wage claim, and brought the Commissioner’s retaliation action to enforce that decision. Following is a more detailed description of pertinent parts of the two proceedings that generated the appeals before us.
1. The Commissioner’s Retaliation Action
In February 2006, Fabe filed a discrimination complaint with the Commissioner, asserting that Cahuenga had sued her in retaliation for Fabe’s having filed her claim for wages, in violation of section 98.6. The Commissioner, in a decision issued in March 2008, found Cahuenga violated section 98.6, and ordered Cahuenga to cease and desist from discriminating against employees for engaging in protected activities; to make Fabe whole for any out-of-pocket expenses and economic losses she may have suffered; and to post a notice to employees about the case.
The Commissioner’s decision states, among other things, that the Division of Labor Standards Enforcement (DLSE) requested information underlying Cahuenga’s malpractice complaint, but Cahuenga pointed only to the allegations in the complaint, and argued that the DLSE had no jurisdiction because Fabe was a former employee at the time of the alleged retaliation. Later, the DLSE’s investigator requested additional information from Hacker (and advised him that a decision would be made solely on the information in the file if Cahuenga did not respond), but Cahuenga submitted nothing. In addition to the proximity in time between Fabe’s wage claim and Cahuenga’s malpractice lawsuit, Fabe provided a witness statement from an individual whom Hacker used to serve Fabe with the malpractice lawsuit. According to that individual, Hacker told him to tell Fabe “that she did not know who she was ‘f------’ with, and that if she did not drop her wage claim against [Cahuenga], she was going to have serious problems.” The Commissioner concluded Fabe had established a prima facie case of retaliation, requiring Cahuenga to offer a legitimate, non-retaliatory reason for the malpractice complaint, but Cahuenga offered no evidence to support its malpractice complaint.
Cahuenga appealed the Commissioner’s decision to the Director of the Department of Industrial Relations (Director), among other things renewing its argument that there was no adverse action because Fabe was a former employee. In June 2008, the Director affirmed the Commissioner’s decision, concluding that the retaliation provisions of the Labor Code apply to former employees as well as current and prospective employees.
In September 2008, the Commissioner, under the authority of section 98.7, sued Cahuenga to enforce the Director’s decision on Fabe’s retaliation claim. The Commissioner sought a cease and desist order and compensation for Fabe for the cost of defending herself caused by the retaliatory filing of the malpractice lawsuit.
If the employer does not comply with the order of the Labor Commissioner “within 10 working days following notification of the Labor Commissioner’s determination, the Labor Commissioner shall bring an action promptly in an appropriate court against the respondent.... In any action, the court... shall have jurisdiction, for cause shown, to restrain the violation and to order all appropriate relief. Appropriate relief includes, but is not limited to, rehiring or reinstatement of the complainant, reimbursement of lost wages and interest thereon, and any other compensation or equitable relief as is appropriate under the circumstances of the case.” (§ 98.7, subd. (c).)
2. The Malpractice Lawsuit
Meanwhile, after Cahuenga Partners and Ron Hacker sued her in October 2005, Fabe brought, and the trial court granted, an anti-SLAPP (strategic lawsuit against public participation) motion, claiming the malpractice lawsuit arose from her protected activity of filing a wage claim. The trial court did not rule on Fabe’s demurrer to the complaint since it granted the anti-SLAPP motion. This court reversed the trial court, while recognizing the trial court had ample reason to believe the lawsuit was retaliatory and that “[s]erious questions abound about the ultimate merit of [Cahuenga’s] complaint....” Further, “Fabe’s demurrer remains to be decided, and the trial court may take judicial notice of the Labor Commissioner’s decision in considering that demurrer.” Among the “[s]erious questions” to which this court referred concerning the ultimate merit of Cahuenga’s malpractice complaint was the fact that, in July 2006, Cahuenga made an offer to compromise the malpractice suit (Code Civ. Proc., § 998) “for almost the exact amount the Commissioner ordered [Cahuenga] to pay Fabe [on her claim for unpaid wages].”
After the malpractice lawsuit was returned to the trial court, Fabe again demurred to the complaint, arguing, inter alia, that Cahuenga did not have “the capacity to sue its employee... for malpractice” because under the doctrine of respondeat superior, Cahuenga was “responsible for the negligence of its employee....” At the hearing, the demurrer was placed off calendar, and Cahuenga filed a first amended complaint.
The first amended complaint alleged two causes of action, one for breach of fiduciary duty and one for professional negligence. The facts alleged were these: Fabe missed numerous deadlines in a lawsuit against Turmeko Properties, as well as in a bankruptcy case. She neglected and “refused to diligently file” a motion for the appointment of a receiver in the Turmeko litigation, “depriving [Cahuenga] of collectible rents”; she failed to file the receiver motion in the proper court; she “failed, neglected, and refused to diligently file” a proof of claim on time in the bankruptcy action, resulting in the denial of Cahuenga’s claims in that case and forcing Cahuenga to hire a bankruptcy attorney to file a motion for reconsideration. Cahuenga also alleged Fabe billed Cahuenga for nonbillable hours and, when she quit, she failed to provide a status report and did not give Cahuenga an opportunity to acquire the services of an attorney “before unreasonably abandoning the cases assigned to her.” Cahuenga alleged Fabe breached her fiduciary duty to it “by failing to represent [Cahuenga] faithfully in the manner it expected, which failures are [the same conduct alleged to constitute professional negligence].”
Fabe filed another demurrer, again contending Cahuenga could not sue its employee for professional negligence. The trial court overruled the demurrer to the breach of fiduciary duty claim, but sustained it without leave to amend as to the malpractice claim. Fabe then cross-complained for indemnity under section 2802, which requires an employer to indemnify an employee for expenditures or losses the employee incurs as a direct consequence of the discharge of his or her duties.
The malpractice lawsuit and the Commissioner’s retaliation action were consolidated, and Fabe then sought summary judgment on the remaining cause of action for breach of fiduciary duty. She submitted a declaration asserting that she never missed a deadline; did not neglect or refuse to file a motion for appointment of a receiver (or to do so in the proper court); did not fail or refuse to file a proof of claim and was not the attorney of record in the bankruptcy action. She submitted a copy of a June 23, 2004 proof of claim in the bankruptcy action showing that another attorney represented Cahuenga in that action, as well as copies of the status report she provided to Cahuenga the day after she quit, the Commissioner’s decision finding she was an employee, and other documents.
Cahuenga’s opposition specified the six acts (described on pp. 6-7, ante) it claimed demonstrated a “breach[] [of] fiduciary duty of competency, ” and contended these constituted disputed facts. Cahuenga submitted a declaration from Kathy Stark, contradicting the assertions in Fabe’s declaration on each of the disputed points. Stark’s declaration stated she was the “authorized agent” of Cahuenga and had personal knowledge that Fabe did each of the acts alleged in the complaint (e.g., Fabe “neglected and refused to file a motion for the appointment of a Court receiver...”). Cahuenga argued Fabe violated rule 3-110 of the Rules of Professional Conduct, which prohibits members of the bar from “intentionally, recklessly, or repeatedly fail[ing] to perform legal services with competence.” (Rules Prof. Conduct, rule 3-110(A).)
Fabe filed objections to the statements in Stark’s declaration, and most of them were sustained. The only evidence left was Stark’s statement that Fabe “failed or neglected to provide [Cahuenga] with a written status report as requested.”
The court granted Fabe’s motion for summary judgment. The court observed that it “appear[ed] that a breach of loyalty/confidence is necessary to state a claim for breach of fiduciary duty, ” but even if a violation of a rule of professional conduct were sufficient, Cahuenga’s complaint contained no allegation that Fabe “intentionally, recklessly, or repeatedly” failed to act diligently, and none of Cahuenga’s evidence supported such a finding. The court concluded that Cahuenga “states nothing more than a claim for legal malpractice, and has no evidence to support a finding that these alleged violations constitute a breach of fiduciary duty.” A judgment was entered in September 2009 dismissing Cahuenga’s first amended complaint with prejudice.
3. The Trial
That brings us to the court trial on the remaining claims: Fabe’s cross-complaint for indemnity for the attorney’s fees she was forced to expend in defense of the malpractice lawsuit, and the Commissioner’s action against Cahuenga for damages and injunctive relief for Cahuenga’s violation of section 98.6.
At trial, most of the testimony involved Fabe’s entitlement to attorney’s fees in compensation for defending against Cahuenga’s malpractice suit. Evidence was also presented that the malpractice lawsuit was retaliatory: the complaint was signed two days after Cahuenga was notified of the wage claim, was filed several weeks later, and was served on Fabe at the hearing on her wage claim. In addition, there was testimony from Jewelle Plunkett Finley, who had worked as an employee for another company managed by Hacker; she, too, had quit her job, filed a wage claim, and was sued for malpractice. And, there was the evidence of Hacker’s remark to his process server that Fabe “did not know who she was ‘f------’ with, ” and would have “serious problems” if she did not drop her wage claim, and Cahuenga’s offer to settle its malpractice claim for virtually the same amount Fabe recovered in her wage claim.
Cahuenga tried to get the court to reconsider its demurrer ruling on the malpractice claim in Cahuenga’s complaint against Fabe, but the court would not do so. Cahuenga also sought to present a witness, William Brownstein, a bankruptcy expert who represented Cahuenga, who was to testify “as to the damage done to Cahuenga and the fee that he charged Cahuenga... to, basically, fix or attempt to fix the result of [Fabe’s] mistake....” The trial court refused to let Cahuenga call the witness because he was not named before trial; “it is like litigation by ambush.”
In the Commissioner’s action, the trial court concluded that the Commissioner established a prima facie case of retaliation (protected activity, adverse employment action, and a causal link between the two), and that Cahuenga failed to come forward with admissible evidence that it had a legitimate reason for filing its lawsuit. The court also rejected Cahuenga’s contention that section 98.6 does not prohibit discrimination against a former employee.
In Fabe’s cross-complaint for indemnity under section 2802 (requiring an employer to indemnify an employee for expenditures and losses incurred in direct consequence of the discharge of the employee’s duties), the court concluded Fabe could not recover from Cahuenga for Cahuenga’s own conduct, but could recover for the conduct of a third party -- in this case, Hacker, who did not dismiss his complaint against Fabe until December 4, 2008.
The court awarded the Commissioner fees and costs of $232,435.50 (and a cease and desist order), and awarded Fabe a judgment for costs and fees of $101,078 (to be offset against any recovery in the Commissioner’s action). The court rejected Cahuenga’s claim that Fabe could not recover fees for her own services, pointing out that under section 98.7, “[a]ppropriate relief” includes “any other compensation or equitable relief as is appropriate under the circumstances of the case.” (§ 98.7, subd. (c).)
Judgment was entered and Cahuenga filed a timely appeal.
A couple of months later, Cahuenga filed an ex parte application for an order correcting clerical errors in the judgment, and to quash an abstract of judgment Fabe had filed which named Hacker as a judgment debtor and indicated that the total amount of the judgment was $232,435.50. The abstract was based on the judgment entered on December 11, 2009, which erroneously named Hacker as a plaintiff and cross-defendant. The trial court amended the judgment to delete reference to Hacker and to clarify that judgment amounts were awarded “against 1538 Cahuenga Partners, LLC, ” and quashed the abstract of judgment.
Fabe filed an appeal from the order quashing the abstract.
DISCUSSION
1. Overview of the Issues and Their Resolution
We are not persuaded by Cahuenga’s argument that the trial court erred in sustaining Fabe’s demurrer to the professional negligence cause of action, nor are we persuaded that the dismissal of that claim had any effect on the result in the Commissioner’s retaliation action. In that lawsuit, the Commissioner was not required, as both Cahuenga and the Commissioner seem to believe, to produce evidence that Cahuenga’s malpractice claim was “frivolous.” The Commissioner was required to show a violation of section 98.6, that is, that the malpractice claim was retaliatory: that Fabe engaged in a protected activity (the wage claim); Cahuenga subjected her to an adverse employment action (the malpractice lawsuit); and there was a causal connection between the two. The Commissioner produced that evidence.
The parties’ extensive argument on the failure of proof that the malpractice claim was frivolous is a red herring of major proportions. This was a retaliation case with the usual burden-shifting requirements for the production of evidence. The Commissioner presented a prima facie case of retaliation (as Cahuenga effectively concedes), and Cahuenga produced no evidence of a legitimate reason for suing Fabe for malpractice. Cahuenga failed to do so during the administrative proceedings, resulting in the Commissioner’s decision (appealed to and affirmed by the Director) that Cahuenga’s malpractice claim was retaliatory. Cahuenga proposed to call a witness to testify about Fabe’s malpractice, but the trial court excluded that witness because he was never disclosed as a witness in advance of trial. The trial court also precluded Cahuenga from offering documents in support of its malpractice claim that were never produced in discovery.
Cahuenga has not challenged the trial court’s evidentiary rulings in its opening brief on appeal. In its reply brief, Cahuenga expressly concedes that it waived any claim of error in the exclusion of its supposed malpractice evidence. Instead, Cahuenga simply relies on its misplaced contention that the Commissioner did not prove Cahuenga’s malpractice claim was frivolous. But no such evidence was required -- only evidence of retaliation was required, and that was produced in full measure.
We also reject Cahuenga’s claim that, even if the lawsuit was retaliatory, its conduct was not actionable under section 98.6, because a lawsuit filed against a former employee does not affect the terms and conditions of employment and is therefore not an “adverse employment action.” We conclude (part 2.b., post) Cahuenga’s conduct was actionable under section 98.6.
We turn first to Cahuenga’s claims of error in the Commissioner’s retaliation action, after which we discuss the errors asserted concerning Fabe’s indemnification claim in the malpractice lawsuit (part 3., post), Cahuenga’s professional negligence claim against Fabe (part 4., post) and Fabe’s cross-appeal (part 5., post).
2. The Commissioner’s Retaliation Action
As we have seen, Cahuenga contends the judgment must be reversed for lack of evidence that its malpractice lawsuit was frivolous and because, as a matter of law, a retaliatory lawsuit against a former employer is not actionable under section 98.6.
a. The “frivolous” issue
Cahuenga concedes that filing a wage claim is protected activity, and further concedes “there was substantial evidence to support a finding that Cahuenga sued Fabe because she filed her wage claim.” (Italics added.) But Cahuenga contends “that, clearly, is not enough to establish a violation of [section] 98.6.” We cannot agree. On the contrary, the concession that there was evidence that “Cahuenga sued Fabe because she filed her wage claim” confirms all the elements of retaliation, unless Cahuenga is correct that, as a matter of law, no retaliation action lies for an employer action that occurs after the employment has ended (part 2.b., post).
Cahuenga makes the concession more than once: “Cahuenga acknowledges Fabe engaged in a protected activity when she filed her wage claim, and that there was substantial evidence to support a finding that Cahuenga filed its action in retaliation for Fabe having engaged in that protected activity.”
Under section 98.6, an employer may not “in any manner discriminate against any employee or applicant for employment... because the employee or applicant for employment has filed a bona fide complaint or claim or instituted or caused to be instituted any proceeding under or relating to his or her rights, which are under the jurisdiction of the Labor Commissioner....” (§ 98.6, subd. (a).)
Section 98.6 prohibits retaliation against employees who complain about an employer’s failure to pay wages. (See Franklin v. Sacramento Area Flood Control (E.D.Cal. Apr. 29, 2009, Civ. No. 07-1263 WBS) 2009 U.S.Dist. Lexis 45229, at pp. 59-61[applying the same burden-shifting analysis applied under federal law to retaliation claim under section 98.6].) The plaintiff establishes a prima facie case of retaliation by producing evidence she engaged in a protected activity, her employer subjected her to an adverse employment action, and there is a causal link between the two. (Yanowitz v. L’Oreal USA, Inc. (2005) 36 Cal.4th 1028, 1042 (Yanowitz) [Fair Employment and Housing Act (FEHA) claim]; Patten v. Grant Joint Union High School Dist. (2005) 134 Cal.App.4th 1378, 1384 [section 1102 claim].) If an employee establishes a prima facie case, the employer is required to offer a legitimate, nonretaliatory reason for the adverse employment action. If such a reason is produced, “the burden shifts back to the employee to prove intentional retaliation.” (Yanowitz, at p. 1042.)
During the proceedings before the Commissioner on Fabe’s retaliation claim, Cahuenga was asked to submit any information it had underlying its malpractice complaint, and was told that a decision would be made on the information in the Commission’s file if Cahuenga failed to respond. Cahuenga offered no evidence, and the Commissioner correctly concluded that Fabe established an unrebutted prima facie case of retaliation. All this was shown in the Commissioner’s retaliation action in the trial court.
Now, Cahuenga contends that in the Commissioner’s retaliation action, the Commissioner had to show also that Cahuenga’s malpractice action was frivolous and filed without probable cause, and did not do so. Cahuenga is mistaken. Conceding there is no California authority for its proposition, Cahuenga cites two cases, from Ohio and Illinois, it claims supports this “common sense conclusion.” They do not. They merely stand for the proposition that, where an employee has sued the employer for discrimination, a subsequent lawsuit by the employer against the employee is not per se or necessarily retaliatory.
In Greer-Burger v. Temesi (2007) 116 Ohio St.3d 324 (Greer-Burger), the employee sued the employer for sexual harassment, and lost. Then, the employer sued the employee for abuse of process, malicious prosecution and intentional infliction of emotional distress. When the employee complained of retaliation to the Ohio Civil Service Commission, the commission found that the employer’s lawsuit was per se retaliatory (“based simply on the fact that [the employer] filed the suit”), without affording the employer an opportunity to show that there was an objective basis for his lawsuit. (Id. at pp. 325, 327.) It was the failure to give the employer this opportunity (“assuming arguendo that [the employee] ha[d] established a prima facie case of retaliation”) that the court could not countenance (id. at p. 327), finding it would violate the employer’s right to petition the government for redress of grievances under the First Amendment. (Id. at pp. 326, 327.) This, of course, is not a case like Greer-Burger; Cahuenga had a full opportunity to show the Commissioner it had a legitimate reason to sue Fabe for malpractice, and elected to produce no evidence. This resulted in the Commissioner’s finding of retaliation, and to claim now that the Commissioner must show Cahuenga’s malpractice lawsuit was “frivolous” in order to prevail in the retaliation action is without basis in law or common sense.
Nor does E. E. O. C. v. Levi Strauss & Company (N.D.Ill. 1981) 515 F.Supp. 640 (Levi Strauss) assist Cahuenga. In Levi Strauss, an employee filed sex discrimination charges at the Equal Employment Opportunity Commission (EEOC) against her supervisor and her employer, alleging she was discharged because she refused the supervisor’s sexual advances. (Id. at p. 641.) While the charges were pending, the supervisor filed a state court action against the employee for slander and defamation. The EEOC then sought an injunction barring the prosecution of the supervisor’s defamation lawsuit. The court merely held that, to obtain an injunction, the EEOC would have to demonstrate that the supervisor’s action was filed for retaliatory purposes. (Id. at p. 644 [“it cannot be concluded that all defamation actions in the wake of sexual harassment charges... are violations of Title VII. Rather, those suits initiated... in good faith and as an attempt to rehabilitate the employer’s reputations which may have been tarnished by the charges are not necessarily violations of the Act.”].)
Just as in Greer-Burger, the Levi Strauss case stands for nothing more than the common-sense proposition that an employer’s lawsuit against an employee filed after the employee has sued the employer does not, for that reason alone, violate statutory prohibitions on retaliation -- the lawsuit must be shown to be retaliatory, that is, an adverse employment action, filed after the employee engaged in protected activity, with a causal link between the two. That was done in this case, in the proceedings before the Commissioner, where Cahuenga had a full opportunity to, but did not, produce evidence of a legitimate reason -- an objective basis, in Greer-Burger’s words -- for its malpractice lawsuit. No more is required.
b. Actionable retaliation under section 98.6
Next, Cahuenga contends that retaliation against a former employee, “by lawsuit or otherwise, ” is not actionable under section 98.6. This argument has two parts: the contention that former employees are not covered, and the related contention that an adverse employment action must affect the terms and conditions of employment. We conclude neither claim is correct.
i. The “former employee” issue
Cahuenga cites no authority for the proposition that former employees are not covered by section 98.6, relying instead on the language of the statute, and on the differences between section 98.6 and the antiretaliation provisions of title VII of the Civil Rights Act of 1964 (hereafter Title VII) (42 U.S.C.S. § 2000e et seq.), which the United States Supreme Court has held do prohibit retaliation against a former employee. (Robinson v. Shell Oil Co. (1997) 519 U.S. 337 (Robinson).) We see no reason to deviate from the analysis in Robinson.
Robinson found the term “employee” as used in the retaliation provision of Title VII was ambiguous, and resolved the ambiguity by concluding that the word included former employees. (Robinson, supra, 519 U.S. at p. 345.) The court observed that several other sections of the statute “plainly contemplate that former employees will make use of the remedial mechanisms of Title VII” (ibid.), so that it was “far more consistent to include former employees within the scope of ‘employees’ protected by § 704(a) [the retaliation provision of Title VII].” (Robinson, at p. 345.) Further, including former employees in the term “employees” was “more consistent with... the primary purpose of” the antiretaliation provision: “[m]aintaining unfettered access to statutory remedial mechanisms.” (Robinson, at p. 346 [finding “persuasive force” in the argument that excluding former employees from the protection of the antiretaliation provisions “would undermine the effectiveness of Title VII by allowing the threat of postemployment retaliation to deter victims of discrimination from complaining to the EEOC, and would provide a perverse incentive for employers to fire employees who might bring Title VII claims”].)
Section 704(a) of Title VII makes it unlawful “for an employer to discriminate against any of his employees or applicants for employment... because he has opposed any practice made an unlawful employment practice by this title, or because he has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under this title.” (42 U.S.C.S. § 2000e-3(a).)
Cahuenga tries to distinguish Robinson and Title VII by pointing out that, unlike in Title VII, which Robinson observed nowhere uses the terms “former employees” or “current employees” (Robinson, supra, 519 U.S. at p. 341), section 98.6 does use the term “former employee” in the final sentence of subdivision (b). That sentence criminalizes an employer’s willful refusal “to hire, promote, or otherwise restore an employee or former employee who has been determined to be eligible for rehiring or promotion by a grievance procedure, arbitration, or hearing authorized by law....” (§ 98.6, subd. (b).)
Cahuenga concludes the use of the term “former employee” in section 98.6, subdivision (b) reflects “a deliberate decision to exclude [former employees] from the protection of the statute.” But Cahuenga offers no support for that proposition, and we reject it. For one thing, the context of subdivision (b) is specific and the use of the term “former employee” in connection with the term “eligible for rehiring” is natural for purposes of clarity. For another, Robinson’s mention of the absence of the terms “former employee” and “current employee” from Title VII occurred only in connection with its discussion of whether or not the term “employee” was ambiguous (because “[a]t first blush, the term ‘employees’ in § 704(a) would seem to refer to those having an existing employment relationship with the employer in question”). (Robinson, supra, 519 U.S. at p. 341.) Robinson does not suggest that the use of the term “former employee” in a particular context would or should mean that its absence elsewhere has any definitive significance. To the contrary, all the reasons stated in Robinson for finding that Title VII’s antiretaliation provisions apply to former as well as current employees -- including the absence of any “temporal qualifier... such as would make plain that [the antiretaliation provision] protects only persons still employed at the time of the retaliation” (id. at p. 341) -- are applicable to the antiretaliation provisions of the Labor Code as well.
Robinson also pointed out that Title VII’s definition of “employee” likewise had no temporal qualifier “and is consistent with either current or past employment.” (Robinson, supra, 519 U.S. at p. 342.) Further, other provisions in Title VII use the term “employees” to mean “something more inclusive or different from ‘current employees, ’” such as remedial provisions, including reinstatement, which necessarily refer to former employees. (Id. at pp. 342-343.)
ii. The “adverse employment action” issue
Finally, Cahuenga contends that a lawsuit is not an adverse employment action -- that is, even a lawsuit filed by an employer against a current employee would not be an adverse employment action, because it does not affect the terms and conditions of employment. For this proposition, Cahuenga cites Yanowitz, supra, 36 Cal.4th 1028. The circumstances in Yanowitz were entirely different from those in this case. Yanowitz did not involve postemployment conduct by the employer, nor did it involve retaliation in the context of a former employee’s wage claim. We conclude, under the “totality-of-the[-]circumstances approach” approved in Yanowitz (id. at p. 1052, fn. 11), that the postemployment retaliation in which Cahuenga engaged met the materiality standard approved in Yanowitz for determining whether an employee has been subjected to an adverse employment action. This conclusion is further bolstered by the high court’s subsequent decision in Burlington Northern & Santa Fe Railway Co. v. White (2006) 548 U.S. 53 (Burlington Northern), holding that Title VII’s antiretaliation provision “does not confine the actions and harms it forbids to those that are related to employment or occur at the workplace.” (Id. at p. 57.)
In Yanowitz, the court addressed “the appropriate standard for determining whether an employee has been subjected to an adverse employment action for purposes of a retaliation claim under the FEHA.” (Yanowitz, supra, 36 Cal.4th at p. 1049.) Yanowitz adopted the “materiality” standard, holding that the retaliation provisions of the FEHA protect against “only the same range of adverse employment actions that are prohibited by” the substantive provisions of the FEHA (id. at p. 1052) -- that is, the provisions making it unlawful (because of enumerated characteristics such as race) to refuse to hire, to discharge, or to discriminate “in compensation or in terms, conditions, or privileges of employment.” (Gov. Code, § 12940, subd. (a); Yanowitz, at p. 1052 [“an adverse employment action must materially affect the terms, conditions, or privileges of employment to be actionable”].)
But Yanowitz also cautioned against an “unduly narrow” view of the type of adverse employment actions that are forbidden by the FEHA:
“Retaliation claims are inherently fact-specific, and the impact of an employer’s action in a particular case must be evaluated in context. Accordingly, although an adverse employment action must materially affect the terms, conditions, or privileges of employment to be actionable, the determination of whether a particular action or course of conduct rises to the level of actionable conduct should take into account the unique circumstances of the affected employee as well as the workplace context of the claim.” (Yanowitz, supra, 36 Cal.4th at p. 1052; id. at fn. 11 [“it is appropriate to consider plaintiff’s allegations collectively under a totality-of-the[-]circumstances approach”].)
The court emphasized that discrimination “‘in compensation or in the terms, conditions, and privileges of employment’ properly must be interpreted broadly to further the fundamental antidiscrimination purposes of the FEHA.” (Yanowitz, supra, 36 Cal.4that p. 1053.) Thus:
“Appropriately viewed, this provision protects an employee against unlawful discrimination with respect not only to so-called ultimate employment actions such as termination or demotion, but also the entire spectrum of employment actions that are reasonably likely to adversely and materially affect an employee’s job performance or opportunity for advancement in his or her career.... [T]he phrase ‘terms, conditions, or privileges’ of employment must be interpreted liberally and with a reasonable appreciation of the realities of the workplace in order to afford employees the appropriate and generous protection against employment discrimination that the FEHA was intended to provide.” (Yanowitz, supra, 36 Cal.4th at p. 1054, fn. omitted, italics added.)
Contrary to Cahuenga’s assertion, we do not think Yanowitz meant that an employer’s retaliatory conduct, if it occurs outside the workplace, is not actionable under the statute. Indeed, that question was not before the Yanowitz court, whose focus was “whether a particular action or course of conduct rises to the level of actionable conduct....” (Yanowitz, supra, 36 Cal.4th at p. 1052 [“Although a mere offensive utterance or even a pattern of social slights by either the employer or coemployees cannot properly be viewed as materially affecting the terms, conditions, or privileges of employment for purposes of [the substantive provision of the FEHA] (or give rise to a claim under [the retaliation provision of the FEHA]), the phrase ‘terms, conditions, or privileges’ of employment must be interpreted liberally and with a reasonable appreciation of the realities of the workplace” (id. at p. 1054, fn. omitted)].)
We thus conclude that retaliatory conduct by an employer after the employment has ended may indeed “materially affect the terms, conditions, or privileges of employment” within the meaning of Yanowitz and within the meaning of the prohibition on retaliation in section 98.6, depending on the circumstances. (See Yanowitz, supra, 36 Cal.4th at p. 1052, fn. 11.) In this case, Fabe quit her job and sought to collect wages due her for work performed, and Cahuenga sued her because she did so. Cahuenga admits “there was substantial evidence to support a finding that Cahuenga filed its action in retaliation for Fabe having engaged in that protected activity.” The right to wages for work performed is at the heart of “the terms, conditions, or privileges of employment.” (Ibid.) To suggest that an employer may with impunity retaliate against an employee for attempting to collect agreed wages, merely because the employment has ended, is preposterous; the claim for wages arose directly from the employment and Cahuenga’s lawsuit necessarily “materially affect[s]” the terms of employment where it is intended to dissuade an employee, current or former, from collecting those wages.
Our conclusion finds further support in Burlington Northern, where the high court held that Title VII’s antiretaliation provision “does not confine the actions and harms it forbids to those that are related to employment or occur at the workplace.” (Burlington Northern, supra, 548 U.S. at p. 57.) Burlington Northern adopted a standard different from the materiality standard adopted in Yanowitz, instead concluding that the antiretaliation provision of Title VII, “unlike the substantive provision, is not limited to discriminatory actions that affect the terms and conditions of employment.” (Burlington Northern, supra, 548 U.S. at p. 64.) The high court adopted a version of the “deterrence” standard, but with a materiality element. The court held that Title VII’s antiretaliation provision “covers those (and only those) employer actions that would have been materially adverse to a reasonable employee or job applicant, ” meaning that “the employer’s actions must be harmful to the point that they could well dissuade a reasonable worker from making or supporting a charge of discrimination.” (Id. at p. 57; id. at p. 63 [Title VII’s objective cannot be achieved “by focusing only upon employer actions and harm that concern employment and the workplace”; an employer “can effectively retaliate against an employee by taking actions not directly related to his employment or by causing him harm outside the workplace”]; id. at p. 67 [“Interpreting the antiretaliation provision to provide broad protection from retaliation helps ensure the cooperation upon which accomplishment of [Title VII’s] primary objective [a workplace without discrimination on the basis of race, ethnicity, religion or gender] depends.”].)
Cahuenga insists that section 98.6 is different from the Title VII antiretaliation provision and does not apply to an employer’s conduct outside the workplace. It points out that Burlington Northern rested on the fact that Title VII’s antiretaliation provision, unlike its substantive antidiscrimination provision, contained no words that limited the scope of the antiretaliation provision “to actions that affect employment or alter the conditions of the workplace.” (Burlington Northern, supra, 548 U.S. at p. 62.) That is so. But, contrary to Cahuenga’s claim, the same is true of section 98.6: it is not expressly limited to actions affecting employment or altering the conditions of the workplace. Cahuenga points to subdivision (b) of section 98.6, which does refer to the terms and conditions of employment. But subdivision (b) provides for certain remedies; it is not the provision that forbids retaliation. That provision is subdivision (a), which prohibits an employer from discharging “or in any manner discriminat[ing] against” an employee or applicant who has filed a claim or engaged in other protected activity. Subdivision (b) governs reinstatement and reimbursement for lost wages, stating that:
Cahuenga points out that, while Burlington Northern adopted a deterrence standard, our own Supreme Court in Yanowitz rejected that standard for evaluating retaliation claims under the FEHA, when it held that an adverse employment action “must materially affect the terms, conditions, or privileges of employment to be actionable....” (Yanowitz, supra, 36 Cal.4th at p. 1052.) That may well be so, but Yanowitz did not consider the question whether postemployment retaliation could “materially affect” the terms, conditions, or privileges of employment. We have answered that question in the affirmative, under the circumstances in this case, where Fabe was sued in retaliation for attempting to collect wages due. Under either standard, materiality or deterrence, Cahuenga’s conduct in suing a former employee “because she filed her wage claim” is actionable retaliation under section 98.6.
c. The judgment for the Commissioner was not excessive.
The judgment in the Commissioner’s retaliation action provided that the Commissioner “shall have and recover fees and costs of $232,435.50 against 1538 Cahuenga Partners, LLC” and that Cahuenga “shall cease and desist from all such future retaliatory actions....” The damages consisted of the cost of Fabe’s defending herself against the malpractice lawsuit (including her cross-complaint against Cahuenga for indemnity), and were calculated by including attorney’s fees for her own services as well as those of Marshall Lerner.
Section 98.7 governs judicial relief that may be granted when the Commissioner brings a court action against an employer. It provides, in pertinent part, that the court has jurisdiction “to restrain the violation and to order all appropriate relief. Appropriate relief includes, but is not limited to, rehiring or reinstatement..., reimbursement of lost wages and interest thereon, and any other compensation or equitable relief as is appropriate under the circumstances of the case.” (§ 98.7, subd. (c), italics added.)
The trial court, observing that effective remedies should be fashioned to make an individual whole, stated:
“Not only should Fabe be made whole, Cahuenga’s retaliatory tactics must be made expensive enough that it will be forced to stop such practices in the future. Hacker, as managing partner of Cahuenga, retaliated against Fabe for seeking her wages earned. Hacker engaged in the same pattern in retaliating against Finley.... [¶]... [¶] The Court agrees with the Commissioner that the only way to make Fabe whole is through the payment of her attorneys fees, as well as those of... Marshall Lerner, a practicing attorney who spent hundreds of hours on this case....”
Cahuenga contends that the Commissioner’s judgment should be reduced by $94,150 -- the portion of the judgment attributable to attorney’s fees for Fabe’s time spent representing herself. The argument goes as follows: (1) Fabe could have filed a lawsuit against Cahuenga for violating section 98.6, instead of pursuing administrative remedies before the Commissioner. (See Lloyd v. County of Los Angeles (2009) 172 Cal.App.4th 320, 323 [“There is no requirement that a plaintiff pursue the Labor Code administrative procedure prior to pursuing a statutory cause of action.”].) (2) If Fabe had filed a lawsuit instead, she could not have been awarded attorney’s fees for representing herself. (See Trope v. Katz (1995) 11 Cal.4th 274, 292(Trope) [“an attorney who chooses to litigate in propria persona and therefore does not pay or become liable to pay consideration in exchange for legal representation cannot recover ‘reasonable attorney’s fees’ under [Civil Code] section 1717 as compensation for the time and effort he expends on his own behalf or for the professional business opportunities he forgoes as a result of his decision”].) Therefore, (3) the trial court exceeded its authority to fashion appropriate relief under section 98.7 when it awarded her the reasonable value of her own legal services.
We see no merit in Cahuenga’s illogical analysis. The fact that Fabe might have pursued a different remedy and might have obtained a different result is entirely irrelevant. Nor does section 98.7 in any way involve an award of contractual or statutory attorney’s fees that would be prohibited under the authority of Trope and its progeny. The only issue here is the scope of the trial court’s authority under section 98.7 to fashion “any... compensation or equitable relief as is appropriate under the circumstances of the case.” (§ 98.7, subd. (c).) While we, like Cahuenga, have found no cases “discussing the limits of a court’s discretion to fashion a remedy for a violation of [section] 98.6[, ]” we do not doubt that the court’s discretion is broad. (Cf. Miller v. Department of Corrections (2005) 36 Cal.4th 446, 475 [“The FEHA should be liberally construed to deter employers from taking actions that would discourage employees from bringing complaints that they believe to be well founded.”]; Frudden Enterprises, Inc. v. Agricultural Labor Relations Bd. (1984) 153 Cal.App.3d 262, 268 [Board had “wide discretion in fashioning remedies under Agricultural Labor Relations Act”; purpose of backpay award was “‘to make whole the employee who has been discriminated against as the result of an unfair labor practice’”].)
Here, there is no basis for finding an abuse of discretion in the trial court’s decision to compensate Fabe for her own services in defending against Cahuenga’s retaliatory lawsuit. As the trial court recognized, that is the only way to make Fabe whole for the four years (now six) of litigation she has had to endure as a consequence of seeking the wages she was due -- from an employer who has engaged in the very same retaliatory conduct in the past. In short, nothing in section 98.7 restricts the court’s discretion to provide a remedy “appropriate under the circumstances of the case, ” and indeed it is hard to imagine a remedy more appropriate than the one imposed by the court.
3. Fabe’s Cross-complaint for Indemnification in the Malpractice Lawsuit
Fabe cross-complained in the malpractice lawsuit for indemnity under section 2802. Under that section, an employer “shall indemnify his or her employee for all necessary expenditures or losses incurred by the employee in direct consequence of the discharge of his or her duties....” (§ 2802, subd. (a).) The term “necessary expenditures or losses” includes “all reasonable costs, including, but not limited to, attorney’s fees incurred by the employee enforcing the rights granted by this section.” (§ 2802, subd. (c).) Thus, section 2802 “requires an employer to indemnify an employee who is sued by third persons for conduct in the course and scope of his or her employment, including paying any judgment entered and attorney’s fees and costs incurred in defending the action.” (Cassady v. Morgan, Lewis & Bockius LLP (2006) 145 Cal.App.4th 220, 230.)
The trial court correctly rejected Fabe’s assertion that she could be indemnified for expenses incurred in a suit her own employer filed against her, but found Cahuenga should indemnify her for expenses incurred in Hacker’s suit against her (since Hacker was a third party and not her employer). Hacker, along with Cahuenga, sued Fabe for breach of contract, fraud, legal malpractice and other claims and did not dismiss his complaint until December 4, 2008, more than three years after he filed it. And, the trial court found, the complaint’s factual allegations showed Fabe’s “actions arose ‘in direct consequence of the discharge of [her] duties’ as required by the statute.” Consequently, the trial court awarded Fabe fees and costs of $101,078 -- the full amount of attorney’s fees and costs accumulated for her services and Marshall Lerner’s services before December 4, 2008.
Cahuenga contends on appeal that Fabe should recover nothing as indemnification for defending against Hacker’s claims, and in any event, she cannot recover attorney’s fees for her own services; Cahuenga also contends the fees were excessive. First, we reject Cahuenga’s contention that Fabe cannot recover indemnification for Hacker’s suit against her. Cahuenga complains that “naming Hacker as a plaintiff made no sense and was a mistake by the attorney who drafted the original Complaint[, ]” a mistake which “cost Fabe nothing.” Further, Cahuenga says the expenses were not “necessary” (as required by section 2802), as “there was no evidence that [Fabe] incurred any expense in defense of Hacker’s, as opposed to Cahuenga’s, claims.” Cahuenga cites no authority to support its contention that either of these rationales should deprive Fabe of the benefit of section 2802. If naming Hacker as a plaintiff was a “mistake, ” the consequences must be borne by Cahuenga, not Fabe, and Fabe’s defense expenditures cannot be segregated as between the two plaintiffs. We thus see no error in the trial court’s award of indemnification to Fabe for fees and costs incurred until Hacker dismissed his complaint against her.
Second, Cahuenga claims the judgment for Fabe is excessive because it includes fees for representing herself and because the fees were “inflated.” Because we are affirming the judgment for the Commissioner in its entirety, these points have no practical consequences for the parties, because any amount awarded to Fabe on her indemnification claim is to be offset against any recovery in the Commissioner’s action. We recognize that, while the Commissioner and Fabe both sought compensation for the same attorney’s fees, they requested fees under different statutes. The Commissioner sought fees on the retaliation claim under section 98.7, and Fabe claimed fees under section 2802 for indemnification from Cahuenga for “all necessary expenditures or losses incurred by” Fabe in consequence of Hacker’s lawsuit against her.
Cahuenga also contends that Fabe should not have been awarded any of her expenses incurred after August 11, 2009 (the date the trial court granted summary judgment on the only remaining cause of action in Cahuenga’s complaint against Fabe). After that date, the only claim remaining was Fabe’s cross-complaint for indemnity. While conceding that Fabe’s right to indemnity includes expenses incurred in establishing that right, Cahuenga says the Commissioner’s action (which by then had been consolidated with Cahuenga’s suit) sought the same relief, so it was not “necessary, ” within the meaning of section 2802, for Fabe to incur any further legal costs. Cahuenga apparently did not make this argument at trial, and accordingly has waived it. In any event, “[n]ecessity is by nature a question of fact[, ]” and “the reasonableness of any given expenditure must turn on its own facts.” (Grissom v. Vons Companies, Inc. (1991) 1 Cal.App.4th 52, 58.) Here, we cannot simply assume that, once she obtained summary judgment on Cahuenga’s claim, Fabe should have ceased her efforts to obtain indemnity and relied on the Commissioner. Cahuenga offers, in short, no reason to question the trial court’s conclusion that all Fabe’s fees were “reasonable and necessary.”
Even if Cahuenga were correct in contending Fabe should not be able to recover attorney’s fees for her own services under section 2802, we decline to reverse and remand to recalculate the amount of attorney’s fees due Fabe on her indemnity claim, because, in light of the entire record of these proceedings, Cahuenga has not shown any actual prejudice. Whether Fabe recovers fees for her own services on her indemnity claim or from the Commissioner on its retaliation claim is of no practical significance. Since we cannot find a different result would have been probable if the court were to have permitted recovery of fees for Fabe’s services under section 98.7 but not under section 2802, we conclude any error was harmless. (Cassim v. Allstate Ins. Co. (2004) 33 Cal.4th 780, 801-802 [“errors in civil trials require that we examine ‘each individual case to determine whether prejudice actually occurred in light of the entire record’”].)
We reject Cahuenga’s arguments that the attorney’s fees were excessive because the Commissioner’s attorney acted as “lead counsel on Fabe’s side of the case, ” making it unnecessary for Fabe to be represented by two lawyers (Fabe and Lerner); Fabe and Lerner had “remarkably little litigation experience”; there was “no evidence” that their services were worth $250 and $350 per hour respectively; and fees of $5,180 to prepare for appellate argument on Fabe’s anti-SLAPP motion and $12,250 to prepare a petition for review were “obscene.”
The trial court disagreed with Cahuenga’s assessment, as do we. As the trial court observed:
“Some perspective on this case is necessary to assess the reasonableness of the fees claimed. First, Fabe has been engaged in an ongoing battle with Cahuenga for four years, at the DLSE, the Director of the Department of Industrial Relations, the Superior Court and the Court of Appeal. During that time, Fabe had not only handled the Labor Commissioner hearings and appeals, she also had to deal with an anti-SLAPP motion, an appeal of that motion, several demurrers and motions to strike, a [Code of Civil Procedure section] 128.7 motion, a Motion for Summary Judgment, numerous court appearances, and Cahuenga’s frequent substitution[s] of attorney. A case of this length with these complexities warrants the number of hours spent in preparation.”
The court, after reviewing the bills, and considering the experience of counsel and fees charged in Los Angeles for counsel with comparable years of experience, found the fees “reasonable and necessary.” Cahuenga has failed to demonstrate any abuse of discretion in the trial court’s decision.
4. The Professional Negligence Cause of Action
Cahuenga contends that the trial court erred when it sustained Fabe’s demurrer to its malpractice action. Cahuenga cites a general statute, a rule of professional conduct, a general statement from Witkin, and two decades-old cases of questionable authority, neither of which concerns professional negligence, in support of the rather startling proposition that a corporate employer may sue its in-house counsel for malpractice. We are not persuaded by Cahuenga’s arguments or authorities.
Cahuenga first cites the general rule of Civil Code section 1714 that “[e]veryone is responsible, not only for the result of his or her willful acts, but also for an injury occasioned to another by his or her want of ordinary care or skill in the management of his or her property or person....” The annotations to that general statute include citations to hundreds of cases, including cases involving medical and other professional negligence, but not one involves a case brought by an employer against in-house counsel. Cahuenga offers no reasoned analysis to persuade us that we should be the first to find the general language of Civil Code section 1714 creates a cause of action for negligence against in-house counsel. We find even less persuasive Cahuenga’s citation to rule 3-400 of the Rules of Professional Conduct, which states, “A member shall not: [¶] (A) Contract with a client prospectively limiting the member’s liability to the client for the member’s professional malpractice.” There is no allegation in this lengthy record that Fabe entered into any such contract with Cahuenga, and we find this rule is of no assistance whatever in our analysis.
Cahuenga also cites section 2865, which, since 1937, has provided that “[a]n employee who is guilty of a culpable degree of negligence is liable to his employer for the damage thereby caused to the employer. The employer is liable to the employee if the service is not gratuitous, for the value of the services only as are properly rendered.” (§ 2865.) Cahuenga cites two cases of questionable authority interpreting this statute to permit an employer to sue an employee for negligence. In the first, Division of Labor Law Enforcement v. Barnes (1962) 205 Cal.App.2d 337 (Barnes), disapproved on another point in White Lighting Co. v. Wolfson (1968) 68 Cal.2d 336, 351, fn. 9), the court of appeal reversed dismissal following the sustaining of a demurrer without leave to amend, finding the plaintiff-employer might be able to amend the complaint to state a cause of action for negligence arising from the defendant-employee’s erratic and insufficient watering of plaintiff’s alfalfa. The Barnes court observed that the employer cited no analogous California authority to support the argument that a cause of action for negligence may lie against an employee, and the court’s own research did not disclose any case which was closely parallel. The nearest case in point that the Barnes court found involved negligence in the drying of prunes. (Barnes, at p. 348.) In the nearly 50 years since Barnes was decided, it has been cited by only one other court as support for the proposition that an employer may sue an employee for negligence.
That second case is Dahl-Beck Electric Co. v. Rogge (1969) 275 Cal.App.2d 893 (Dahl-Beck), in which the employer sought to recover the cost of emergency repairs after a backhoe operator caused a water main to drop into a ditch. The jury found the employees were not negligent, and the court of appeal affirmed the judgment. The chief contentions on appeal concerned alleged instructional error. The court of appeal found there was no error in the trial court’s refusal to give one of the requested instructions because it had nothing to do with the definition of “culpable negligence, ” as that term is used in section 2865. The court of appeal found no error in the refusal to give the second requested instruction because it equated “culpable negligence” with ordinary negligence, on which the court had adequately instructed the jury. Having decided the requested instruction defining “culpable negligence” was “extraneous, ” the court then in dicta addressed the meaning of the term “culpable negligence, ” despite acknowledging “no case has been found or cited which defines ‘culpable degree of negligence’ as it is set out in [section 2865].” (Dahl-Beck, at p. 906.) No court has cited Dahl-Beck in the 41 years since it was decided for the proposition that an employer may sue an employee for negligence.
With no more authority than these two decades-old, largely ignored cases arising in the farming and construction industries of the post-World War II era, neither of which rested on any authority, one of which was purely dicta, Cahuenga asks us to hold that in the complex legal community of the 21st century, a corporate employer may sue its in-house counsel for professional negligence. Cahuenga offers no reasoned argument why we should interpret the term “culpable degree of negligence” in section 2865, for the first time since its enactment in 1937, to include the professional negligence of in-house counsel. To extrapolate from post-war alfalfa, prunes and backhoes to the contemporary legal world is a great leap we are unwilling to make, particularly not in this case. Cahuenga acknowledges there is substantial evidence it sued Fabe in retaliation for her wage claim, and it has never in good faith offered a shred of evidence to suggest there is any merit to the malpractice claim. For us to hold in this case that Cahuenga may sue Fabe for malpractice would create a new paradigm for the old adage that bad facts make bad law. We are indeed confronted with bad facts in this case, but we decline to make bad law; this is not the case in which to decide there is a cause of action for malpractice against in-house counsel.
5. Fabe’s Cross-appeal
The judgment entered on December 11, 2009, erroneously named Hacker as a plaintiff and cross-defendant. Fabe filed an abstract of judgment naming Hacker as one of the judgment debtors. The trial court granted Cahuenga’s application for an order correcting the judgment to delete reference to Hacker and quashing the abstract of judgment.
At the hearing on Cahuenga’s motion to correct the judgment and quash the abstract of judgment, Fabe said nothing about Cahuenga’s request to quash the abstract. Nor did she do so in her opposition papers, instead arguing that the errors in the judgment were not clerical errors and that the court had no jurisdiction to amend the judgment. (Fabe also filed a motion to amend the judgment to add Hacker as an alter ego.) Only now, on appeal, does Fabe claim that the trial court should have done what she did not ask it to do: quash the abstract only as to Hacker and not as to Cahuenga. Even if such an approach were feasible procedurally, Fabe waived any claim of error by failing to raise the issue with the trial court. It is too late to do so now. (Bell v. American Title Ins. Co. (1991) 226 Cal.App.3d 1589, 1602 [failure to effectively oppose a motion in the trial court waived any objections to the resulting order].)
DISPOSITION
The judgment in favor of the Commissioner is affirmed. The judgment in favor of Fabe is affirmed. The order quashing the abstract of judgment is affirmed. Cahuenga shall pay the Commissioner’s and Fabe’s costs on appeal.
WE CONCUR: RUBIN, Acting P. J., FLIER, J.
“Any employee who is discharged, threatened with discharge, demoted, suspended, or in any other manner discriminated against in the terms and conditions of his or her employment because the employee engaged in [protected activity]..., or because the employee has made a bona fide complaint or claim to the division... shall be entitled to reinstatement and reimbursement for lost wages and work benefits caused by those acts of the employer....” (§ 98.6, subd. (b).)
Subdivision (b) of section 98.6 simply has no application to a case where the employer’s retaliatory act causes the employee harm outside the workplace; in such cases, “reinstatement and reimbursement for lost wages and work benefits” would not afford an appropriate remedy. Nothing in subdivision (b) works any limitation on, or is in any way inharmonious with, the breadth of the prohibition in subdivision (a).