Opinion
B228683
12-14-2011
CLEOPATRA ANDERSON et al., Plaintiffs and Respondents, v. AG SEAL BEACH et al., Defendants and Appellants.
Garcia Artigliere & Schadrack, Stephen M. Garcia and Mark A. Schadrack, for Defendants and Appellants. Law Offices of Michael F. Moran, Michael F. Moran and Lisa Trinh Flint, for Plaintiffs and Respondents.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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. BC378525)
APPEAL from a judgment of the Superior Court of Los Angeles County. Michael C. Solner, Judge. Affirmed in part, reversed in part and remanded.
Garcia Artigliere & Schadrack, Stephen M. Garcia and Mark A. Schadrack, for Defendants and Appellants.
Law Offices of Michael F. Moran, Michael F. Moran and Lisa Trinh Flint, for Plaintiffs and Respondents.
INTRODUCTION
Beverly Anderson filed a complaint in her personal capacity and as successor-in- interest to her mother, Cleopatra Anderson, against Memorial Hospital of Gardena, Los Alamitos Medical Center and appellant Country Villa Seal Beach Health Care Center. The complaint alleged numerous claims arising from injuries that Cleopatra allegedly sustained from a pressure sore. Plaintiffs settled with Gardena and Los Alamitos, but proceeded to trial against Country Villa. The jury found that Country Villa was negligent and awarded $171,000 in economic damages, which was comprised entirely of medical expenses. The jury also found that Country Villa had violated Health and Safety Code section 1430, subdivision (b), which provides a private cause of action for violations of the Patients Bill of Rights.
After the jury entered its verdict, Country Villa filed motions arguing that: (1) plaintiffs' economic damages should be limited to the amount Cleopatra's insurer actually paid for her medical services; (2) pursuant to Code of Civil Procedure section 877, plaintiffs' damages should be offset against the settlement proceeds received from Gardena and Los Alamitos; and (3) plaintiffs were not entitled to judgment on their section 1430 claim because of a defect in the special verdict form. The trial court denied all three motions.
Plaintiffs then filed a motion seeking approximately $600,000 for attorneys' fees incurred in litigating their section 1430 claim. The court awarded $305,000 in attorneys' fees and entered judgment in favor of plaintiffs.
On appeal, Country Villa argues that: (1) the trial court erred in failing to limit plaintiffs' economic damages to the amount Cleopatra's insurers paid for her medical services; (2) it was entitled to settlement offsets under Code of Civil Procedure section 877; (3) a defect in the special verdict form precluded the trial court from entering judgment in favor of plaintiffs on their section 1430 claim; and (4) the trial court abused its discretion in awarding $305,000 in attorneys' fees. We reverse in part, affirm in part and remand for further proceedings.
FACTUAL AND PROCEDURAL BACKGROUND
A. Summary of Plaintiffs' Complaint, Pretrial Settlement and Trial
In October of 2007, Beverly Anderson (Beverly) filed a complaint in both her individual capacity and as successor-in-interest to Cleopatra Anderson (Cleopatra)against Memorial Hospital of Gardena (Gardena), Los Alamitos Medical Center (Los Alamitos), Country Villa Seal Beach Healthcare Center and various entities related to Country Villa (collectively Country Villa). The complaint alleged that Cleopatra was hospitalized at Gardena, where she developed a stage 2 pressure sore. Cleopatra was later transferred between Los Alamitos and Country Villa, where the pressure sore advanced from stage 2 to stage 4 and allegedly caused her death.
Because the plaintiffs share the same last name, we refer to them by their first names for convenience and clarity, and intend no disrespect. (Cruz v. Superior Court (2004) 120 Cal.App.4th 175, 188, fn. 13.)
The Country Villa defendants included AG Seal Beach, LLC dba Country Villa Seal Beach Health Care Center, AG Facilities Operations, LLC and Country Villa Service Corp. dba Country Villa Health Services. Appellants' briefs refer to this group of defendants collectively as Country Villa and we do the same.
The complaint alleged six causes of action against all three defendants, which included elder abuse, negligence, willful misconduct, negligent infliction of emotional distress and wrongful death. The complaint asserted a seventh claim solely against Country Villa under Health and Safety Code section 1430, subdivision (b) (section 1430 claim), which provides "a civil action against the licensee of a [skilled nursing] facility who violates any rights of the . . . patient as set forth in the Patients Bill of Rights." Beverly asserted the claims for negligent infliction of emotional distress and wrongful death in her individual capacity, and the remainder of the claims in her capacity as successor-in-interest to Cleopatra.
Prior to trial, plaintiffs informed the court they had reached a settlement with Gardena and Los Alamitos. According to plaintiffs' counsel, Gardena had agreed to settle "for Beverly Anderson's negligent infliction of emotional distress claim in the amount of $40,000," and that Los Alamitos had agreed to settle "in the amount of $75,000 for . . . [the] elder abuse cause of action and dismissal for waiver of costs as to the remaining causes of action . . . ." The trial court accepted the settlements and excused Gardena and Los Alamitos from the proceedings.
Plaintiffs proceeded to trial against Country Villa on four causes of action: (1) negligence, (2) elder abuse, (3) wrongful death, and (4) violation of section 1430. Plaintiffs' counsel prepared two separate special verdict forms. "Special Verdict Form Number One" related to the first three causes of action and asked the jury to determine whether each of the originally named defendants was liable on each claim. "Special Verdict Form Number Two" related to plaintiffs' section 1430 claim, which was pleaded against Country Villa alone. The form contained two questions that asked the jury to determine: (1) whether Cleopatra "was given good personal hygiene and care to prevent bedsores," and (2) if not, "the number of days on which she did not receive such care."
In its responses to Special Verdict Form Number One, the jury found in favor of plaintiffs on their negligence claim, but found in favor of Country Villa on the elder abuse and wrongful death claims. The jury awarded $171,000 in damages for past medical expenses and apportioned liability between the treating facilities as follows: 62% to Gardena, 10% to Los Alamitos, and 28% to Country Villa. In its responses to Special Verdict Form Number Two, the jury found that Cleopatra had not received "good personal hygiene and care to prevent bedsores" on nine separate days.
B. Summary of Posttrial Motions
1. Applications for good faith settlement and Country Villa's motion for offset
After the jury entered its verdict, settling defendants Gardena and Los Alamitos each filed an application for good faith settlement pursuant to Code of Civil Procedure section 877.6, subdivision (a)(2). Gardena's application stated that it had settled for $40,000 and Los Alamitos' application stated that it had settled for $75,000. Neither application indicated whether the settling parties had elected to apportion the settlement proceeds among the various claims asserted in plaintiffs' complaint.
In its response to the settling defendants' applications, Country Villa asserted that it did not oppose the settlements "so long as the entire settlement amount . . . [was] fully and completely available to the Country Villa Defendants for purposes of offset." Plaintiffs submitted a reply brief arguing that offset was not available because the settlements did not allocate any of the proceeds to the negligence claim. According to plaintiffs, the Gardena settlement allocated 100% of the proceeds to Beverly's cause of action for negligent infliction of emotional distress and the Los Alamitos settlement allocated 100% of the proceeds to Cleopatra's cause of action for elder abuse. Plaintiffs asserted that because Country Villa had not been found liable on either such claim at trial, it was not entitled to any offset from the settlements. After holding a hearing on the matter, the trial court found the settlements in good faith.
Country Villa subsequently filed a "motion to offset settlements" arguing that plaintiffs and settling defendants had failed to show why they had allocated the entire amount of the settlement proceeds to the emotional distress and elder abuse claims. The trial court denied the motion based on its prior finding that the settlements were made in good faith.
2. Motion to ascertain amount of medical special damages
Country Villa also filed a motion to reduce the jury's award of medical damages to the amount Cleopatra's insurers had actually paid to her medical care providers. Country Villa argued that, under Hanif v Housing Authority (1988) 200 Cal.App.3d 635 (Hanif)and Nishihama v. City and County of San Francisco (2001) 93 Cal.App.4th 298 (Nishihama), it was entitled to a hearing "for the limited purpose of ascertaining what amounts" Cleopatra's "medical facility accepted as payment in full from the insurer."
In opposition, plaintiffs argued that a recent decision from the California Court of Appeal, Howell v. Hamilton Meats & Provisions, Inc., then published at 101 Cal.Rptr.3d 805, had specifically rejected Hanif and Nishihama and held that, under the collateral source rule, an injured plaintiff is entitled to recover the full amount of her medical expenses even if her insurer paid the medical service providers less than the full amount of those expenses. Country Villa, in turn, argued that Howell was "wrongly decided" and that the court "should instead follow the Hanif/Nishihama line of cases." The trial court took the matter under submission. While the matter was pending, the California Supreme Court granted review in Howell.
As discussed in more detail below, the Supreme Court subsequently granted review in Howell (see Howell v. Hamilton Meats & Provisions, Inc. (2010) 106 Cal.Rptr.3d 770 [granting petition for review on March 10, 2010]), and issued its decision after the parties completed their briefing in this matter. (See Howell v. Hamilton Meats & Provisions, Inc. (2011) 52 Cal.4th 541 (Howell).)
On August 12, 2010, the trial court issued a written order explaining that "[t]he central question being raised here . . . is whether the jury's award of past medical expenses should be reduced to the amounts that were actually paid by plaintiff or her insurers to satisfy the medical bills or should the award stand at the amount actually incurred." The trial court acknowledged that Hanif and Nishihama had held that "a plaintiff could not recover more from a liable wrongdoer than the amount actually paid by plaintiff or by her insurance." However, it determined that a more recent decision, Yanez v. Soma Environmental Engineering (Yanez), then published at 111 Cal.Rptr.3d 257, had rejected those authorities in holding that "the extent that the reasonable value of the provider's services was greater than the discounted amounts paid or incurred, the plaintiff was entitled to the entire amount of damages under the collateral source rule." The court elected to follow Yanez, rather than Hanif and Nishihama, and ordered that "plaintiffs are entitled to recover the full reasonable value of the services provided."
On September 1, 2010, the Supreme Court granted review in Yanez and deferred further action "pending consideration and disposition of a related issue in Howell . . . ." (Yanez v. Soma Environmental Engineering, Inc. (2010) 115 Cal.Rptr.3d 535.)
3. Motions regarding plaintiffs' section 1430 claim
a. Country Villa's motion to enter judgment in its favor on section 1430 claim
Country Villa also filed a motion arguing that the jury's responses in Special Verdict Form Number Two were insufficient to support a judgment on plaintiffs' section 1430 claim. Specifically, Country Villa argued that the verdict form did not identify Country Villa as the entity responsible for violating section 1430, subdivision (b). Instead, the jury's responses found only that Cleopatra had not received good hygiene to prevent bed sores on nine different days. Country Villa alleged that because the jury had heard extensive evidence regarding the settling defendants' alleged role in causing Cleopatra's bedsore, it was impossible to determine which entity the jury was referring to in its responses to Special Verdict Number Two.
The trial court denied the motion, ruling that there was sufficient evidence to uphold the verdict against Country Villa.
b. Plaintiffs' motion for attorney fees under section 1430, subdivision (b)
Plaintiffs filed a motion for attorneys' fees under section 1430, subdivision (b), which provides that any party who violates the statute "shall be liable for up to five hundred dollars ($500), and for costs and attorney fees." Plaintiffs requested approximately $600,000 in attorneys' fees, which represented the total amount of hours it had incurred in prosecuting its claims against Country Villa.
Country Villa opposed the motion on three grounds. First, it asserted that plaintiffs were ineligible for attorneys' fees because the jury verdict form did not award any damages or other form of relief on the section 1430 claim. Second, Country Villa argued that the plaintiffs were only entitled to recover the portion of their attorneys' fees that were incurred in litigating the section 1430 claim. Third, Country Villa argued that the plaintiffs had submitted numerous double billings and provided no evidence to support their hourly fee rate.
The trial court ruled that plaintiffs were entitled to attorneys' fees. The court further concluded that plaintiffs' claims against Country Villa were so interrelated that it was impossible to "parse out what type of attorney work went solely to the 1430(b) part of the case and what part went to anything else." Although the court found that the plaintiffs' hourly billing rates were reasonable, it reduced the requested attorneys' fees award to $305,000.
The trial court entered judgments awarding plaintiffs $171,000 for economic damages on their negligence claim and $318,045.39 for attorneys' fees and costs on their section 1430 claim. Country Villa filed a timely appeal of both judgments.
DISCUSSION
On appeal, Country Villa argues that the trial judge erred in: (1) denying its motion to reduce economic damages to the amount that Cleopatra's health care provider paid for her medical services; (2) failing to offset plaintiffs' economic damages award against the settlement proceeds they received from Gardena and Los Alamitos; (3) entering judgment against Country Villa on plaintiffs' section 1430 claim; and (4) awarding plaintiffs over $300,000 in attorneys' fees.
A. Country Villa is Entitled to Have Plaintiffs' Economic Damages Reduced to the Amount Paid by Cleopatra's Insurance Providers
Country Villa argues that the trial court erred in denying its motion for a posttrial evidentiary hearing to determine the amount Cleopatra's insurers paid to her medical care facilities. According to Country Villa, the court was required to reduce plaintiffs' economic damages for medical care - which amounted to $171,000 - to the amounts that Cleopatra's insurer actually paid to the medical care facilities. Plaintiffs, however, argue that, the trial court properly ruled that, under the collateral source rule, Cleopatra was entitled to recover the full reasonable value of her medical care, which the jury found to be $171,000. Alternatively, plaintiffs argue that Country Villa waived its right to assert this argument by failing to introduce evidence of collateral source payments at trial.
Whether the collateral source rule entitles the plaintiffs to recover the full, reasonable value of Cleopatra's medical services presents an issue of law. We therefore apply a de novo standard of review. (In re Marriage of Bodo (2011) 198 Cal.App.4th 373, 384.)
1. Intervening decision of the California Supreme Court: Howell v. Hamilton Meats & Provisions, Inc., supra, 52 Cal.4th 541
At the time of the trial court proceedings, there was a split of authority as to whether an injured plaintiff whose medical expenses were paid through private insurance could recover more in economic damages than the amount his or her insurer actually paid to the service provider. (Compare Hanif, supra, 200 Cal.App.3d at p. 641 ["when the evidence shows a sum certain to have been paid or incurred for past medical care and services, whether by the plaintiff or by an independent source, that sum certain is the most the plaintiff may recover for that care despite the fact that it may have been less than the prevailing market rate"]; Nishihama, supra, 93 Cal.App.4th at p. 306 [following Hanif]with Yanez, supra, 111 Cal.Rptr.3d at p. 267, review granted September 1, 2010, No. S184846 ["the trial court erred in reducing [plaintiff's] damages to the amounts actually paid by her insurers . . . . Hanif used overly broad language and the extension of its holding to private insurance by Nishihama and other cases is inconsistent with the collateral source rule"].)
The trial court acknowledged that, at the time of its decision, the issue was pending before the California Supreme Court in Howell v. Hamilton Meats & Provisions, Inc., No. S179115, but elected to follow authorities holding that "to the extent that the reasonable value of the provider's services was greater than the discounted amount paid or incurred, the plaintiff was entitled to the entire amount of damages under the collateral source rule." Based on this ruling, the court concluded that "plaintiffs [were] entitled to recover the full reasonable value of the services provided. Since the jury found that $171,000 in damages for past medical expenses was reasonable, plaintiff here is entitled to that amount without any hearing or any reduction."
Shortly after the parties completed their appellate briefing in this matter, the California Supreme Court issued Howell v. Hamilton Meats & Provisions, Inc., supra, 52 Cal.4th 541, holding that an injured plaintiff may not recover more in economic damages than the amount actually paid by his or her insurer for services rendered. The defendant in Howell had "moved in limine to exclude evidence of medical bills that neither plaintiff nor her health insurer . . . had paid. [Defendant] asserted that [the insurance provider's] payment records indicated significant amounts of the bills from plaintiff's health care providers . . . had been adjusted downward before payment pursuant to agreements between those providers and [the insurer]. . . . [Defendant] argued that because only the amounts paid by plaintiff and her insurer could be recovered, the larger amounts billed by the providers were irrelevant and should be excluded. The trial court denied the motion, ruling that plaintiff could present her full medical bills to the jury and any reduction to reflect payment of reduced amounts would be handled through 'a posttrial Hanif motion.'" (Id. at p. 549.)
Because the Supreme Court issued Howell after the parties completed their appellate briefing, we requested that they file supplemental briefs addressing the impact of the decision on this case.
Plaintiff introduced evidence at trial that the total amount billed for her medical care "was $189,978.63, and the jury returned a verdict awarding that same amount as damages for plaintiff's past medical expenses." (Howell, supra, 52 Cal.4th at pp. 549- 550.) Defendant then "made a 'post-trial motion to reduce past medical specials pursuant to [Hanif],' seeking a reduction of $130,286.90, the amount assertedly 'written off' by plaintiff's medical care providers." (Ibid.) "In opposition, plaintiff argued reduction of the medical damages would violate the collateral source rule." (Ibid.) The trial court "granted [defendant's] motion, reducing the past medical damages award 'to reflect the amount the medical providers accepted as payment in full.'" (Ibid.) The Court of Appeal reversed the reduction order, "holding it violated the collateral source rule." (Ibid.)
The Supreme Court, however, reversed the appellate court, holding "that an injured plaintiff whose medical expenses are paid through private insurance may recover as economic damages no more than the amounts paid by the plaintiff or his or her insurer for the medical services received or still owing at the time of trial." (Howell, supra, 52 Cal.4th at p. 566.) The Court concluded that although "[t]he collateral source rule . . . ensures that the plaintiff . . . may recover in damages the amounts her insurer paid for her medical care[,] [t]he rule . . . has no bearing on amounts that were included in a provider's bill but for which the plaintiff never incurred liability because the provider, by prior agreement, accepted a lesser amount as full payment. Such sums are not damages the plaintiff would otherwise have collected from the defendant. They are neither paid to the providers on the plaintiff's behalf nor paid to the plaintiff in indemnity of his or her expenses. Because they do not represent an economic loss for the plaintiff, they are not recoverable in the first instance. The collateral source rule precludes certain deductions against otherwise recoverable damages, but does not expand the scope of economic damages to include expenses the plaintiff never incurred." (Id. at pp. 548-549.)
The court also explained how its ruling affected the admissibility of certain types of evidence: "[i]t follows . . . that when a medical care provider has, by agreement with the plaintiff's private health insurer, accepted as full payment for the plaintiff's care an amount less than the provider's full bill, evidence of that amount is relevant to prove the plaintiff's damages for past medical expenses and, assuming it satisfies other rules of evidence, is admissible at trial. Evidence that such payments were made in whole or in part by an insurer remains, however, generally inadmissible under the evidentiary aspect of the collateral source rule. [Citation.] Where the provider has, by prior agreement, accepted less than a billed amount as full payment, evidence of the full billed amount is not itself relevant on the issue of past medical expenses." (Howell, supra, 52 Cal.4th at p. 567.)
Based on the Supreme Court's decision in Howell, which was issued after judgment was entered in this case, it is clear that the trial court erred in ruling that "plaintiffs are entitled to recover the full reasonable value of the services provided," even if Cleopatra's insurers paid a lesser amount for those services.
In their supplemental brief, plaintiffs argue that Howell does not apply here because: (1) plaintiffs have alleged professional negligence against a health care provider, and (2) Cleopatra was insured by a public insurer, whereas the plaintiff in Howell was insured by a private, insurer. We find no merit in either argument. First, although the Supreme Court noted that Civil Code section 3333.1 has abrogated the collateral source rule in "professional negligence action[s] against a health care provider" (Howell, supra, 52 Cal.4th at p. 552), nothing in the opinion suggests that plaintiffs in such cases are entitled to collect more in economic damages than the amount paid by their insurers. The court specifically stated that Civil Code section 3333.1 "do[es] not speak to the issue" of whether an injured plaintiff can recover "amounts that were included in a provider's bill but for which . . . the provider, by prior agreement [with the insurer], accepted a lesser amount as full payment." (Id. at pp. 548.) Second, Howell is not limited to cases involving private insurers. Indeed, the Court found that, for the purposes of its holding, the distinction between public health insurance and private insurance was irrelevant. (Id. at pp. 556-557.)
2. Country Villa has not waived its right to seek reduction of economic costs
Plaintiffs argue that, despite the Supreme Court's ruling in Howell, Country Villa "waived [its] right" to seek a reduction of economic damages because it chose not to introduce any evidence of collateral source payments at trial, which it was entitled to do under Civil Code section 3333.1.
Prior to trial, plaintiffs brought a motion in limine to preclude Country Villa from referencing any evidence of collateral source payments that Cleopatra's insurers made for her medical services. The trial court denied the motion, ruling that plaintiffs' negligence claim fell within Civil Code section 3333.1, subdivision (a), which permits collateral source evidence in cases alleging professional negligence against a health care provider. The statute states, in relevant part, "[i]n the event the defendant so elects, in an action for personal injury against a health care provider based upon professional negligence, he may introduce evidence of any amount payable as a benefit to the plaintiff as a result of the personal injury pursuant to . . . any health . . . insurance. . . ." Although the trial court denied plaintiffs' motion in limine, Country Villa elected not to introduce any evidence of collateral payments at trial. Plaintiffs assert that, by doing so, Country Villa waived its right to seek a posttrial reduction of Cleopatra's medical damages.
Section 3333.1 merely permits "'a defendant in a medical malpractice action to introduce evidence of a variety of "collateral source" benefits.'" (Hernandez v. California Hospital Medical Center (2000) 78 Cal.App.4th 498, 506.) There is no language in the statute suggesting that a defendant is required to introduce such evidence or that, by failing to do so, a defendant waives its right to seek posttrial reduction in economic damages. The statute is simply not relevant to the issue before us.
We do note, however, that Howell has now clarified the proper procedure for seeking a reduction in economic damages based on collateral source payments. The court explained that, because defendants are entitled to admit evidence at trial showing that a medical care provider has "accepted as full payment for the plaintiff's care an amount less than the provider's full bill," (Howell, supra, 52 Cal.4th at p. 567), it is "unnecessary" for trial courts to conduct a "nonstatutory," posttrial motion to determine whether a defendant is entitled to a reduction in economic damages. Rather, "[w]here a trial jury has heard evidence of the amount accepted as full payment by the medical provider but has awarded a greater sum as damages for past medical expenses, the defendant may move for a new trial on grounds of excessive damages. . . . The trial court, if it grants the new trial motion, may permit the plaintiff to choose between accepting reduced damages or undertaking a new trial." (Ibid.)
Howell suggests that future litigants may be barred from requesting a special posttrial hearing to reduce economic damages to the amounts an insurer actually paid for medical services. Although Country Villa requested such a hearing in this case, it did not have the benefit of the Howell decision at the time the trial court adjudicated these issues. Moreover, during the trial court proceedings, plaintiffs never argued that it would be procedurally improper to permit such a hearing; they argued only that: (1) no such hearing was necessary because plaintiffs were entitled to the full, reasonable value of Cleopatra's medical services, and (2) Country Villa waived its right to such a hearing.
We therefore conclude that, on remand, Country Villa should be given an opportunity to make an evidentiary showing that the jury's economic damages award exceeded the amount that Cleopatra's insurers paid for her medical services. To the extent Country Villa can make such a showing, it is entitled to a reduction of the jury's economic damages award.
B. The Trial Court Erred in Denying Country Villa's Motion for Offset
Country Villa contends that, pursuant to Code of Civil Procedure section 877, the trial court was required to offset the economic damages awarded on plaintiffs' negligence claim against the payments plaintiffs received from the Gardena and Los Alamitos settlements.
1. Summary of settlement proceedings in trial court
Prior to trial, plaintiffs informed the court that they had reached a settlement with Gardena and Los Alamitos. On February 13, 2009, plaintiff's counsel summarized the terms of the settlements on the record: "As to defendant [Gardena], plaintiffs agreed to settle for Beverly Anderson's negligent infliction of emotional distress claim in the amount of $40,000 . . . . [¶] And, as to Los Alamitos, . . . defendant's settlement in the amount of $75,000 for the defendant Beverly Anderson's elder abuse cause of action and dismissal for waiver of costs as to the remaining causes of action against both defendants." Gardena's counsel clarified that it "[was] settling for $40,000 for the negligent infliction of emotional distress. All other claims will be dismissed with an exchange of waiver and costs." The trial court accepted the settlements and excused the settling defendants from the proceedings.
After the conclusion of the trial, Gardena and Los Alamitos each filed an application for good faith settlement pursuant to Code of Civil Procedure section 877.6, subdivision (a)(2). Gardena's application stated that it had "settled with plaintiff for forty thousand dollars. . . . This settlement agreement does not apportion the settlement between plaintiff (sic) nor does it allocate funds between economic and general damages . . . but it is contingent upon the court's finding that this settlement is in good faith within the meaning of Code of Civil Procedure § 877.6, et seq." Gardena's counsel filed a declaration in support of the application stating that the settlement was "reached after arms length negotiations between plaintiff's counsel and counsel for Memorial Hospital of Gardena." Neither the application nor the accompanying declaration indicated whether the parties had elected to apportion the settlement proceeds among the various claims pleaded in plaintiffs' complaint.
Los Alamitos's application asserted that "[t]he basis and the terms of the settlement were that Plaintiffs dismissed the Complaint with prejudice, against the above Defendants and signed a release of all claims against said Defendants and its employees with prejudice in exchange for $75,000." The application also represented that "[t]he negotiations between the settling parties were conducted in good faith. There was no collusion, fraud, or tortuous (sic) conduct aimed to inure (sic) the interests of the non- settling defendants." Like Gardena's application, the Los Alamitos application did not discuss whether the parties had elected to apportion the settlement proceeds among each of plaintiffs' claims.
Although the application was accompanied by a declaration from Los Alamitos's counsel, the record does not contain a copy of the declaration, which appears to have been redacted.
In response to the applications for a good faith settlement determination, Country Villa asserted that it did not oppose the settlements "so long as the entire settlement amount . . . is fully and completely available to [Country Villa] for purposes of offset. . . . [S]hould plaintiff seek to sequester any of the settlement monies paid by [defendants] from offset, [Country Villa] oppose[s] the settlement as not being in good faith and will request the court to allocate the settlement monies to the negligence cause of action for use as an offset."
Plaintiffs filed a reply brief arguing that the settlements could not be used to offset Country Villa's negligence damages because the settling defendants had not allocated any of the settlement proceeds to the negligence claim. According to plaintiffs, the Gardena settlement allocated 100% of the proceeds to Beverly's cause of action for negligent infliction of emotional distress. In support, plaintiffs cited language in the Gardena settlement stating that, in consideration for $40,000, Gardena was being released from "recovery sought for in the cause of action for negligent infliction of emotional distress in [the lawsuit]" and "from damages allegedly sustained by the [plaintiffs] . . . caused . . . by the medical negligence or any other violation of law . . . relating to [the lawsuit]." Plaintiffs further asserted that the Los Alamitos settlement allocated 100% of the proceeds to Cleopatra's cause of action for elder abuse. The Los Alamitos settlement included language stating that "For and consideration of the payment of $75,000, for . . . Cleopatra Anderson's Elder Abuse Cause of Action. The remaining Causes of Action will be dismissed for a waiver of costs." Plaintiffs did not provide any argument or evidence explaining why the settling defendants had allocated the settlement proceeds in such a manner.
At the good faith settlement hearing, which was held in June of 2009, Country Villa's counsel reiterated that the defendant had "no problem" with the "fact that [the settlement] money was paid and [that Los Alamitos and Gardena] were out before trial." Instead, Country Villa was "contesting . . . the fact that there has been a clear effort to sequester funds from offset" by allocating the settlement proceeds to the emotional distress and elder abuse claims. Plaintiffs' counsel did not attempt to justify the allocation, but argued that Country Villa was not entitled to offset because the settlements involved "different causes of action."
Several months after the trial court's approval of the applications for good faith settlement, Country Villa filed a "motion to offset settlements" arguing that, pursuant to Code of Civil Procedure section 877, the trial court was required to "offset[] the settlements received by plaintiffs from other defendants in this case against the jury's award of damages against [Country Villa]." Country Villa argued that plaintiffs had failed to provide the court with any evidence showing a rational basis for allocating all of their settlement proceeds to the emotional distress and elder abuse claims.
In opposition, plaintiffs argued that the trial court had already resolved this issue against Country Villa during the good faith hearing, where Country Villa had effectively made the same legal arguments. The trial court agreed with plaintiffs and elected to "deny the motion to offset" based on its prior ruling "that the settlements were made in good faith."
2. Summary of Code of Civil Procedure sections 877 and 877.6
Code of Civil Procedure sections 877 and 877.6 describe the procedures used to obtain the court's determination of a good faith settlement and the effect of that determination in a multi-party litigation.
Section 877.6 "provides the framework under which a settlement . . . can be determined to be in good faith . . . ." (Dillingham Construction, N.A., Inc. v. Nadel Partnership, Inc. (1998) 64 Cal.App.4th 264, 278 (Dillingham).)The statute states, in relevant part, that "a settling party may give notice of settlement to all parties and to the court, together with an application for determination of good faith settlement and a proposed order. The application shall indicate the settling parties, and the basis, terms, and amount of the settlement." (Code Civ. Proc., § 877.6(a)(2).) Once a settling party has provided notice of settlement and filed an application, "'[t]he party asserting the lack of good faith shall have the burden of proof on that issue.'" (Dillingham, supra, 64 Cal.App.4th at p. 278 [citing and quoting § 877.6, subd. (d).)
Section 877, in turn, describes the effect of obtaining a determination of good faith settlement. The statute states, as relevant: "Where a release . . . is given in good faith before verdict or judgment to one or more of a number of tortfeasors claimed to be liable for the same tort . . . it shall have the following effect: [¶] (a) It shall not discharge any other such party from liability unless its terms so provide, but it shall reduce the claims against the others in the amount stipulated by the release . . . . [¶] (b) It shall discharge the party to whom it is given from all liability for any contribution to any other parties." Thus, a trial court's finding of a good faith settlement has two important consequences under section 877: First, it "'bars nonsettling defendants from seeking contribution from a settling defendant. . . .'" (Reed v. Wilson (1999) 73 Cal.App.4th 439, 443.) Second, "'the nonsettling defendants' ultimate liability to the plaintiff is reduced by the amount stipulated by the release or by the amount of consideration paid.' [Citations.]" (Ibid.)
"Three interests are at work in section 877. '" First . . . is the maximization of recovery to the injured party for the amount of his injury to the extent fault of others contributed to it . . . . Second is encouragement of settlement of the injured party's claim. . . . Third is the equitable apportionment of liability among the tortfeasors."' [Citation.] It follows that the 'statute must be interpreted to allow the plaintiff full recovery to the extent that others are responsible for his injuries.' [Citation.] However, an additional purpose of the statute is to prevent double recovery for the same wrong. [Citation.]" (Dell'Oca v. Bank of New York Trust Co., N.A. (2008) 159 Cal.App.4th 531, 560 (Dell'Oca).)
3. The trial court erred in denying offset
Country Villa raises two arguments regarding its entitlement to offset. First, it contends that, regardless of how the settling parties elected to allocate the settlement proceeds among the various claims asserted in this action, Country Villa is entitled to offset because plaintiffs' claims against Country Villa and the settling defendants arose from a single injury. Second, it argues that, to the extent the settling defendants' allocation of the settlement proceeds would otherwise bar offset, plaintiffs failed to establish that such allocation was made in good faith.
A trial court's determination of whether parties settled in good faith is subject to review under the abuse of discretion standard. (Erreca's v. Superior Court (1993) 19 Cal.App.4th 1475, 1504-1505 (Erreca's).)However, whether a trial court's determination of good faith operates to exclude a portion of the settlement from offset is a question of law reviewed de novo. (Fullerton Redevelopment Agency v. Southern California Gas Co. (2010) 183 Cal.App.4th 428, 432.)
a. The Los Alamitos settlement is subject to section 877offset because plaintiffs' claims for elder abuse and negligence involve the same injury
Country Villa argues that it was entitled to offset because all of the named defendants were claimed to have caused a single, indivisible harm to plaintiffs, and therefore qualify as "joint tortfeasors" within the meaning of section 877. Plaintiffs, however, contend that: (1) section 877 only permits offset "against like claims," and (2) because the settling defendants agreed to allocate the settlement proceeds to plaintiffs' claims for negligent infliction of emotional distress and elder abuse, the settlements may not be used to offset damages awarded against Country Villa on plaintiffs' negligence claim.
i. Application of section 877 turns on whether multiple defendants are alleged to have committed the same harm, not whether they are alleged to have committed the same tort
Contrary to plaintiffs' contention, the application of section 877 does not depend on whether multiple defendants are alleged to have committed the exact same tort. Rather, it depends on whether the defendants are alleged to have collectively caused "one indivisible injury" or "the same wrong." (May v. Miller (1991) 228 Cal.App.3d 404, 409-10.) "The 'same wrong' may emanate from two successive independent torts and does not require unity of purpose, action, or intent by the two or more tortfeasors. [Citations.] . . . [T]he plaintiff need not allege the same tort against the tortfeasors, but must only claim that the tortfeasors caused the same harm. [Citation.]" (In re JTS Corp. (9th Cir. 2010) 617 F.3d 1102, 1116-1117 (JTS Corp.).)
For example, in Lafayette v. County of Los Angeles (1984) 162 Cal.App.3d 547 (Lafayette), plaintiff sued the County of Los Angeles for medical malpractice and sued his attorney for legal malpractice in the handling of the medical malpractice action. The attorney elected to settle. The county, however, proceeded to trial and was found liable in the amount of $84,000. The county then sought an offset for the amount the plaintiff received from the settlement with his attorney. Plaintiff argued that offset was not available because he had pleaded different claims against the two defendants: legal malpractice against his attorney and medical malpractice against the county.
The court rejected the argument, holding that section 877 applied because the plaintiff claimed both defendants were liable for the same wrong: "damages resulting from the County's tort." (Lafayette, supra, 162 Cal.App.3d at p. 555.) The court explained that "[i]n [a] . . . legal malpractice case, the negligent attorney is liable for the damages his client was not able to recover from a prior tortfeasor." (Ibid.) Thus, if the plaintiff had not suffered "damages from the prior tort [committed by the County], then the [plaintiff] would not have been damaged and would have no right to recover from the attorney." (Ibid.)According to the court, denying the county offset would effectively award the plaintiff "double recovery for the same tort." (Ibid.)
Similarly, in Kohn v. Superior Court (1983) 142 Cal.App.3d 323 (Kohn), the plaintiffs purchased a home that had been previously damaged by a fire. After the sale was complete, plaintiffs sued the sellers of the house, a pest control company that inspected the property prior to the sale and a construction company that repaired the home after the fire occurred. The complaint alleged that the sellers "misrepresented the condition of the property and breached their fiduciary duty to disclose the fire damage to plaintiffs. Causes of action against [the construction company and pest control company] alleged negligent repair and inspection." (Id. at p. 326.) The sellers filed a cross- complaint against the co-defendants for indemnification of any damages assessed against them. Prior to trial, the pest control company and construction company settled with plaintiff. The trial court found the settlements to be in good faith and dismissed the sellers' cross-complaint pursuant to section 877.
On appeal, the sellers argued that section 877 was inapplicable because "they and the settling defendants [were] not 'claimed to be liable for the same tort,' as required by the statute." (Kohn, supra, 142 Cal.App.3d at p. 328.) Specifically, sellers argued that they had been sued for fraudulent nondisclosure while the settling parties had been sued for "failure to repair or inspect." (Ibid.) The court ruled that section 877 applied because "there was but one injury, purchase of a house which was worth less than plaintiffs believed. [Citation.] The alleged tortious activities by the contractor, pest control inspector and seller were not independent, but combined to create one indivisible injury which took place when the sale was consummated." (Ibid.)
Despite this case law, plaintiffs contend that "where there are multiple claims by multiple parties, a pretrial settlement is properly credited against the judgment only to the extent the judgment awards damages for the same claims embraced by the settlement." In support, plaintiffs cite a single case: Wilson v. John Crane, Inc. (2000) 81 Cal.App.4th 847 (Wilson). In Wilson, a husband and wife filed an action against numerous asbestos companies for personal injury and loss of consortium. Plaintiffs settled with several entities prior to trial and allocated the proceeds of the settlement as follows: "60 percent to the personal injury claims of plaintiff Daniel Wilson [the husband], 20 percent to the loss-of-consortium claim of plaintiff Lois Wilson [the wife], and 20 percent to the potential wrongful death claims of plaintiffs' heirs." (Id. at p. 859.) The defendant proceeded to trial and the jury "returned a special verdict finding that plaintiffs suffered damages as a result of defective products manufactured by defendant." (Id. at p. 851) The jury awarded "Daniel Wilson . . . economic damages . . . and noneconomic damages . . . [,] and [awarded] . . . Lois Wilson . . . damages of $1 million for loss of consortium." (Ibid.)
After trial, defendant argued that the damages awards should be offset for the full amount of the prior settlements. Plaintiffs, however, asserted that the portion of the settlements allocated to the heirs' wrongful death claim should not be included in the offset because the judgment against the defendant did not include any damages associated with that claim. The court agreed, explaining that "[a] cause of action for wrongful death belongs 'not to the decedent [or prospective decedent], but to . . . qualifying heirs and dependents. [Citations.] The damages recoverable in such an action are expressly limited to those not recoverable in a survival action . . . . [Citations.]" (Wilson, supra, 81 Cal.App.4th at pp. 860-861.) The court emphasized that the standard jury instruction "concerning damages for wrongful death, instructs the jury to compensate the heirs for the loss which they have suffered, including lost financial support, and to exclude (among other things) the decedent's pain and suffering." (Id. at p. 862.) According to the court, because of "the legal distinctness and independence of wrongful death . . . and personal injury claims[,] [i]t follows that the settlement of one such claim may serve as a credit only against a judgment on the same claim." (Ibid.)
Wilson is consistent with Lafayette and Kohn. In effect, Wilson concluded that a wrongful death claim seeks recovery for injuries that are distinct from those compensable in a personal injury case: in the former, the compensable injury is the loss suffered by the heirs; in the latter, the compensable injuries are those suffered by the decedent. Because the two claims involve two distinct injuries, offset between such claims is not available under section 877. In contrast, the plaintiffs in Lafayette and Kohn sought damages from multiple defendants that arose from a single injury: in the former, the plaintiff sought compensation from both defendants for injuries sustained from the county's medical malpractice; in the latter, the plaintiffs sought compensation from each defendant for injuries that arose by purchasing a house which was worth less than plaintiffs believed.
ii. Country Villa is entitled to offset the Los Alamitos settlement
In this case, plaintiffs allegedly allocated 100% of the Los Alamitos settlement to Cleopatra's elder abuse claim and 100% of the Gardena settlement to Beverly's negligent infliction of emotional distress claim. For the purposes of this section, we assume that these allocations were proper, and consider whether either settlement should have been offset against Country Villa's negligence damages.
Under the case law summarized above, Country Villa is entitled to an offset for the value of the Los Alamito settlement, which allocated all of the settlement proceeds to plaintiffs' elder abuse claim. Although Country Villa was found liable for negligence, rather than elder abuse, it is apparent that both claims involved the same alleged injury. (See JTS Corp., supra, 617 F.3d at p. 1118 ["It is irrelevant that the [plaintiff] alleged different torts against [defendant] and the settling defendants since their concerted conduct produced the same injury"].) Plaintiffs' negligence claim asserted that Country Villa and Los Alamitos harmed Cleopatra by failing to provide reasonable treatment to ensure that "pressure sores [would] not develop or progress." Plaintiffs' elder abuse claim asserted that Country Villa and Los Alamitos harmed Cleopatra by, among other things, failing to "attend and maintain [Cleopatra's] physical hygiene" and take other actions "so that bedsores would not and should not have occurred resulting in skin breakdown." Therefore, the alleged tortious activity arising from the negligence and elder abuse claims resulted in a single injury: personal injuries that Cleopatra sustained as a result of her bedsore. Accordingly, Country Villa is entitled to an offset of the Los Alamitos settlement.
The Gardena settlement, however, was allocated entirely to Beverly's claim for negligent infliction of emotional distress. Plaintiffs elected not to pursue this claim against Country Villa at trial and, as a result, the judgment included no damages for Beverly's emotional distress. Like the wrongful death claim described in Wilson, Beverly's emotional distress claim did not seek compensation for injuries that Cleopatra suffered as the result of the defendants' negligent care. Instead, the emotional distress claim sought recovery for injuries Beverly allegedly suffered by "observing her mother receive neglectful custodial care from the Defendants . . . resulting in significant pressure sores and the death of her mother." (See, e.g., Thing v. La Chusa (1989) 48 Cal.3d 644, 647 [plaintiff who is "closely related to the injury victim" and "present at the scene of the injury-producing event at the time it occurs and is then aware that it is causing injury to the victim" may obtain "damages for emotional distress"].) Because plaintiffs' emotional distress and negligence claims sought compensation for two distinct injuries, withholding Gardena's settlement sum from offset does not permit a "double recovery for the same wrong. [Citation.]" (Dell'Oca, supra, 159 Cal.App.4th at p. 560.) Therefore, to the extent plaintiffs properly allocated the Gardena settlement to Beverly's emotional distress claim, Country Villa is not entitled to an offset.
b. Plaintiffs failed to make an evidentiary showing that the allocation of proceeds in the Gardena settlement was made in good faith
Country Villa next argues that, even if it would not be entitled to an offset for settlement proceeds that were properly allocated to Beverly's emotional distress claim, offset is proper here because plaintiffs and Gardena did not provide any basis for allocating the entire settlement payment to that claim.
"The statutory requirement of good faith [embodied in sections 877 and 877.6] extends not only to the amount of the overall settlement but as well to any allocation which operates to exclude any portion of the settlement from the setoff." (Knox v. County of Los Angeles (1980) 109 Cal.App.3d 825, 837.) Therefore, "[w]here the settling parties have agreed to allocate . . . [the] settlement amount to a portion of the causes of action, an evidentiary showing is required to justify such allocation." (Erreca's, supra, 19 Cal.App.4th at p. 1491.) "A party seeking confirmation of a settlement must explain to the court and to all other parties, by declaration or other written form, the evidentiary basis for any allocations and valuations made. . . . [Citation.]" (Id. at pp. 1495-1496.) Although settling parties are not required "to make a complete explanation of their rationale for the allocation of settlement," they must "furnish to the court and to all parties an evidentiary showing of a rational basis for the allocations made and the credits proposed." (Regan Roofing Co. v. Superior Court (1994) 21 Cal.App.4th 1685, 1704.)
"[T]he court hearing the motion is not required to conduct an evidentiary hearing on the basis for the allocation. . . . Instead, the trial court is accorded wide discretion to control '[t]he nature, extent and the procedure' regarding any challenges to the valuation placed on the settlement by the settling parties. [Citation.]" (Erreca's, supra, 19 Cal.App.4th at pp. 1496.)
In this case, plaintiffs and Gardena did not submit any evidence to the trial court in support of their decision to allocate 100% of the settlement proceeds to Beverly's emotional distress claims and 0% to the remaining claims. Indeed, they did not even attempt to explain the basis for making such an allocation. They argued only that Country Villa was not entitled to offset because the settlement involved a claim that had not been asserted against Country Villa at trial.
Plaintiffs' appellate brief repeats the arguments they presented to the trial court. The brief contains no argument explaining why the allocation was reasonable nor does it cite to any evidence in the record demonstrating a rational basis for the allocation. Plaintiffs contend only that offset was unavailable because, under Wilson, a "[section] 877 credit can only be made against like claims." This argument, however, does not address whether the allocation was proper. As discussed above, if plaintiffs and Gardena had properly allocated the settlement proceeds to Beverly's emotional distress claim, Wilson would be applicable. However, nothing in Wilson suggests that a trial court may presume the propriety of an allocation where the settling parties have provided no evidentiary showing that the allocation was reasonable. Indeed, Wilson did not even "reach the issue . . . whether plaintiffs provided a sufficient factual basis for the proposed allocation." (Jones v. John Crane, Inc. (2005) 132 Cal.App.4th 990, 1010, fn. 8.)
Although trial courts have wide discretion to decide whether settling parties have provided sufficient evidence to justify a proposed allocation, in this case the record contains no evidence in support of the allocation. We therefore remand this issue to the trial court to allow plaintiffs an opportunity to make a proper evidentiary showing regarding the proposed allocation of the Gardena settlement. (See Knox, supra, 109 Cal.App.3d at pp. 836-837 [remanding case to permit plaintiffs to make proper "evidentiary showing . . . establishing and justifying an agreed allocation . . ."].) To the extent plaintiffs cannot provide a rational basis for allocating 100% of the Gardena settlement to Beverly's emotional distress claim, and 0% to the remaining claims, Country Villa will be entitled to a further offset.
Normally, in a multi-defendant litigation, the determination of whether a settlement was made in good faith occurs before the case proceeds to trial against the nonsettling defendants. It is therefore incumbent on the settling parties to introduce evidence demonstrating to the court that any allocation of settlement proceeds was reasonable. In this case, however, the settling defendants' good faith applications were heard and decided after trial. Thus, the court presumably heard extensive trial evidence regarding each of the claims asserted against Country Villa, which might have enabled the court to determine the propriety of the settling parties' allocation decision. However, at the good faith hearing, plaintiffs conceded that they did not introduce any evidence at trial regarding Beverly's emotional distress claim. As a result, the trial court had no way to determine the strength of that claim or the propriety of allocating 100% the Gardena settlement to the claim.
C. The Trial Court Did Not Err in Entering Judgment or Awarding Attorneys' Fees on Plaintiffs' Section 1430 claim
Country Villa argues that the trial court erred in: (1) entering judgment in favor of plaintiffs on their section 1430 claim, and (2) awarding plaintiffs $305,000 in attorneys' fees on that claim.
1. Summary of plaintiffs' section 1430 claim
Health and Welfare Code section 1430, subdivision (b) states that "A current or former resident or patient of a skilled nursing facility . . . may bring a civil action against the licensee of a facility who violates any rights of the resident or patient as set forth in the Patients Bill of Rights in Section 72527 of Title 22 of the California Code of Regulations. . . . The licensee shall be liable for up to five hundred dollars ($500), and for costs and attorney fees, and may be enjoined from permitting the violation to continue." The "Patients Bill of Rights" includes the right to receive "good personal hygiene and . . . care to prevent bedsores." (See Cal. Code Regs., tit. 22, § 72527, subd. (a)(25); Health & Saf. Code, §1599.1, subd. (b).)
The plaintiffs only pleaded their section 1430 claim against Country Villa because the other defendants, Los Alamitos and Gardena, were not "licensees" of a skilled nursing facility. At trial, plaintiffs introduced evidence that at least one of the Country Villa entities was a licensee of a skilled nursing facility. Plaintiffs' counsel referenced this evidence in his closing argument. There was no evidence introduced at trial indicating that either of the settling defendants was a licensee of a skilled nursing facility.
At the close of trial, the jury received the following instruction regarding the section 1430 claim: "A current or former resident or patient of a skilled nursing facility may bring a civil action against the licensee of a facility who violates any rights of the resident or patient as set forth in the Patients Bill of Rights, or any other right provided for by federal or state law or regulation. The licensee shall be liable for the acts of its employees."
Special Verdict Form Number Two asked the jurors two questions: "1. Do you find Cleopatra was given good personal hygiene and care to prevent bedsores?"; "2. If your answer to Question No. 1 is 'no', please indicate the number of days Cleopatra Anderson was not given good personal hygiene and care to prevent bedsores." The jury answered "no" to the first question and "nine days" to the second question.
The trial court entered judgment against Country Villa based on the jury's responses in Special Verdict Number Two and awarded plaintiffs $305,000 in attorneys' fees.
2. The trial court did not err in entering judgment against Country Villa on plaintiffs' section 1430 claim
Country Villa argues that the trial court erred in entering judgment on the section 1430 claim because Special Verdict Form Number Two did not specifically identify Country Villa as the party against whom the jury was entering its verdict. In contrast, Special Verdict Form Number One, which governed the remainder of plaintiffs' claims, asked the jury to determine whether each of the original defendants (Gardena, Los Alamitos and Country Villa) committed negligence, elder abuse or wrongful death. The jury's responses to Special Verdict Number One found that Gardena and Los Alamitos were both negligent and had not used reasonable care in providing skin care hygiene. Country Villa argues that, because the jury found that all three of the original defendants were negligent, and because Special Verdict Form Number Two did not require the jury to identify any specific party, it is impossible to determine which entity the jury found to have violated section 1430.
"[A] special verdict's correctness must be analyzed as a matter of law." (Mendoza v. Club Car, Inc. (2000) 81 Cal.App.4th 287, 303.) We therefore apply a de novo standard of review.
a. Country Villa has forfeited any argument regarding the form or content of Special Verdict Form Number Two
Plaintiffs argue that Country Villa has forfeited any argument regarding ambiguities arising from the content of Special Verdict Form Number Two because it did not object to the form (or the jury's responses thereto) at any time prior to the discharge of the jury. The Fourth District recently summarized the rules regarding forfeiture in the context of an allegedly ambiguous verdict: "The rules are well-settled. '"If the verdict is ambiguous the party adversely affected should request a more formal and certain verdict. Then, if the trial judge has any doubts on the subject, he may send the jury out, under proper instructions, to correct the informal or insufficient verdict." [Citations.]' [Citation.] A party who fails to object to a special verdict form ordinarily waives any objection to the form. [Citations.] However, waiver is not automatic, and there are many exceptions. [Citation.] For example, '[w]aiver is not found where the record indicates that the failure to object was not the result of a desire to reap a "technical advantage" or engage in a "litigious strategy." [Citations.]' [Citation.] Nor is an objection required when the verdict is fatally inconsistent. [Citations.]" (Behr v. Redmond (2011) 193 Cal.App.4th 517, 529-530 (Behr).)
Country Villa has not asserted that either of the exceptions described in Behr apply here. Although Country Villa has argued that the jury's responses on Special Verdict Form Number One raise questions as to which defendant the jury was referencing in its responses to Special Verdict Form Number Two, it has never argued that the verdict forms were "fatally inconsistent" such that the normal rules of forfeiture would not apply.
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The plaintiff is generally "responsible for having a verdict form submitted to the jury on her case." (Behr, supra, 193 Cal.App.4th at p. 530.) However, if the defendant believes that there is an issue that is "important to determining liability or the absence thereof," it is "incumbent on him to see that findings regarding [that issue] were included in the verdict." (Ibid.)
Here, Country Villa argues that Special Verdict Form Number Two was ambiguous because it did not identify (or ask the jury to determine) the specific party that failed to give Cleopatra "good personal hygiene and care to prevent bedsores." Country Villa apparently believes - at least in hindsight - that including the names of the settling defendants on the special verdict form was important to determining its liability on the section 1430 claim. It was therefore incumbent on Country Villa to have requested that such information appear on the verdict form prior to the dismissal of the jury. The record indicates that Country Villa made a similar request in relation to jury questions regarding plaintiffs' elder abuse claim on Special Verdict Number One. However, it made no such request in relation to Special Verdict Form Number Two.
Country Villa has never attempted to explain why it "did not object [earlier] in the proceedings - when the court could have corrected any defect in the form and sent the jury back to complete its deliberations." (Jenson v. BMW of North America, Inc. (1995) 35 Cal.App.4th 112, 132 (BMW).) Instead, it contends that forfeiture does not apply "where a special verdict omits something required to support the judgment the plaintiff seeks."
Country Villa correctly asserts that if a special verdict form omits a finding on "a fact necessary to support a cause of action . . . , judgment on that cause of action cannot stand." (Behr, supra, 193 Cal.App.4th at p. 531.) In such cases, forfeiture does not apply because the verdict form is not merely ambiguous, but lacks "a factual finding essential to [plaintiff's] claim." (Ibid.)Here, however, the verdict form did not omit a fact necessary to support plaintiff's section 1430 claim. Country Villa was the only defendant at trial and the only party against whom the section 1430 claim was pleaded. It was therefore not "essential" that the verdict form name Country Villa. At most, the failure to include a question asking the jury to confirm that it was finding against Country Villa on the section 1430 claim merely created an ambiguity in the verdict.
b. The jury verdict was not hopelessly ambiguous
Even if Country Villa had preserved its argument regarding the format of Special Verdict Form Number Two, we do not agree that the jury's failure to identify Country Villa would require a reversal.
"'A verdict should be interpreted so as to uphold it and to give it the effect intended by the jury, as well as one consistent with the law and the evidence.'" (All-West Design, Inc. v. Boozer (1986) 183 Cal.App.3d 1212, 1223.) "[R]eversal is required" only if the verdict is "hopelessly ambiguous." (Woodcock v. Fontana Scaffolding & Equip. Co. (1968) 69 Cal.2d 452, 457.) To avoid hopeless ambiguity, the court may "'interpret the verdict from its language considered in connection with the pleadings, evidence and instructions.'" (Id. at p. 456.)
In this case, plaintiffs' complaint asserted a section 1430 claim against one defendant: Country Villa. The plaintiffs introduced evidence at trial that at least one of the Country Villa defendants was a licensee of a skilled nursing home. No such evidence was introduced in relation to either Los Alamitos or Gardena. The jury was specifically instructed that a claim arising under section 1430, subdivision (b) may only be brought by a "patient of a skilled nursing facility. . . against the licensee of a facility. . . ." We therefore must assume the jury understood that only a licensee of a skilled nursing facility could be found liable for violating section 1430 claim. (People v. Holt (1997) 15 Cal.4th 619, 662 ["Jurors are presumed to understand and follow the court's instructions"].) Because Country Villa was the only defendant that was shown to be a licensee, the trial court properly concluded that the jury's responses to Special Verdict Form Number Two were sufficient to enter judgment against Country Villa.
3. The trial court did not err in awarding attorneys' fees
Country Villa argues that the trial court should not have awarded plaintiffs attorneys' fees on their section 1430 claim. Alternatively, Country Villa argues that the amount of the attorney's fees award was not reasonable.
a. The trial court did not err in concluding that plaintiffs were entitled to attorneys' fees
Country Villa asserts that the trial court erred in concluding that plaintiffs were entitled to attorneys' fees because the special verdict form did not award damages or any other form of relief on the section 1430 claim. The special verdict form indicated that the jury found that Cleopatra had not received good personal hygiene to prevent bedsores on nine separate days. The form did not, however, ask the jury to calculate damages or provide any other type of relief. "Whether attorney fees may be awarded is a question of law, which we review de novo." (Dzwonkowski v. Spinella (2011) 200 Cal.App.4th 930, 934.)
Country Villa argues that when a plaintiff recovers no damages - or only nominal damages - "'the only reasonable fee is no fee at all.' [Citations.]" In support, Country Villa relies on cases interpreting and applying United States Code section 1988, which provides: "in any action [arising under 42 USC 1983 and various other enumerated statutes] . . . the court, in its discretion, may allow the prevailing party . . . a reasonable attorney's fee . . . ."
The attorneys' fees provision in section 1430, however, is not discretionary in nature. Instead, section 1430, subdivision (b) states that any licensee who violates the Patients Bill of Rights "shall be liable for up to five hundred dollars ($500), and for costs and attorney fees, and may be enjoined from permitting the violation to continue." Under the plain language of the statute, an award of attorneys' fees is a mandatory form of relief regardless of whether the plaintiff is awarded any other form of relief.
b. The trial court did not err in refusing to apportion plaintiffs' attorneys' fees
Country Villa argues that the trial court erred by refusing to apportion plaintiffs' attorneys' fees between each of their claims, and to award only those fees that were incurred in litigating the section 1430 claim. "When fees are authorized for some causes of action in a complaint but not others, allocation is a matter within the trial court's discretion." (Amtower v. Photon Dynamics, Inc. (2008) 158 Cal.App.4th 1582, 1604; Bell v. Vista Unified School Dist. (2000) 82 Cal.App.4th 672, 687 (Vista Unified)["apportionment of fees and costs similarly rests within the sound discretion of the trial court"].) We therefore review for abuse of discretion.
In the trial court, plaintiffs sought approximately $590,000 in attorneys' fees for 943.2 hours that were "spent prosecuting [the] case against" Country Villa. In opposition, Country Villa argued that plaintiffs were not entitled to recover the entire cost of the litigation; instead, they were only entitled to recover fees incurred in litigating their section 1430 claim. The trial court, however, concluded that plaintiffs' claims were too interrelated for the court to "parse out what type of attorney work went solely to the 1430(b) part of the case and what part went to anything else." The court did find that some of the billings were duplicative and "arguably didn't apply to [Country Villa]." Therefore, it awarded plaintiffs $305,000 in attorneys' fees, which was almost 50% less than they had request.
"When a cause of action for which attorney fees are provided by statute is joined with other causes of action for which attorney fees are not permitted, the prevailing party may recover only on the statutory cause of action. However, the joinder of causes of action should not dilute the right to attorney fees. Such fees need not be apportioned when incurred for representation of an issue common to both a cause of action for which fees are permitted and one for which they are not. All expenses incurred on the common issues qualify for an award. [Citation.] When the liability issues are so interrelated that it would have been impossible to separate them into claims for which attorney fees are properly awarded and claims for which they are not, then allocation is not required. [Citation.]" (Akins v. Enterprise Rent-A-Car Co. (2000) 79 Cal.App.4th 1127, 1133.)
In this case, there was significant factual overlap between plaintiffs' section 1430 claim and their claims for negligence, elder abuse and wrongful death. To prevail on their section 1430 claim, plaintiffs had to show that defendant failed to give Cleopatra "good personal hygiene and care to prevent bedsores." That same factual showing was relevant to plaintiffs' negligence claim, which asserted that Country Villa "negligently failed to care for [Cleopatra]" by "allow[ing] pressure sores to progress and worsen" and "allowing [Cleopatra] to suffer from . . . poor hygiene [and] multiple pressure sores."
These alleged acts were also essential to plaintiffs' elder abuse and wrongful death claims. Plaintiffs' elder abuse claim alleged that Country Villa had failed to "attend and maintain [Cleopatra's] physical hygiene" or utilize adequate resources "to meet the needs of [Cleopatra] so that bedsores would not and should not have occurred resulting in skin breakdown." The special verdict form questions on plaintiffs' elder abuse claim specifically asked the jury to decide whether Country Villa and the other entities had used "reasonable care in assisting in personal hygiene and skin care." Finally, plaintiffs' wrongful death claim asserted that Country Villa's failure to "attend to [Cleopatra's] personal hygiene" and properly treat her "pressure sores" caused her death. It is therefore apparent that the question of whether Country Villa provided appropriate care and treatment of bed sores was of central importance to each of plaintiffs' claims. Because each of "plaintiff's various claims involve[d] a common core of facts or [were] based on related legal theories," the trial court did not abuse its discretion by refusing to apportion plaintiffs' fees. (Drouin v. Fleetwood Enterprises (1985) 163 Cal.App.3d 486, 493.) Indeed, having presided over the jury trial, the trial court was uniquely positioned to determine whether, and to what extent, plaintiffs' claims were "so intertwined that it would be impracticable, if not impossible, to separate the attorney's time into compensable and noncompensable units." (Vista Unified, supra, 82 Cal.App.4th at p. 687.)
c. The trial court did not abuse its discretion in concluding that plaintiffs' hourly rate was reasonable
On the final page of its appellate brief, Country Villa contends that the trial court's attorneys' fee award must be reversed because there was "no evidence of the 'reasonableness' or 'prevalence' of the high hourly rates sought ($450 for [plaintiff's lead counsel] and $275 for [a third year associate]." "The determination of what constitutes [a] . . . reasonable attorney fee[] is committed to the sound discretion of the trial court. An appellate court will interfere with that determination only where there has been a manifest abuse of discretion." (Fed-Mart Corp. v. Pell Enterprises, Inc. (1980) 111 Cal.App.3d 215, 228 (Fed-Mart).)
Plaintiffs' motion for attorneys' fees was accompanied by declarations reciting the experience of both attorneys that litigated the case. Lead attorney Michael Moran's declaration stated that he had been an attorney with the State Bar of California since 1985, tried over 100 jury trials to verdict in the State of California, and had specialized in elder abuse litigation since 1999. Lisa Trinh, the billing associate on the matter, declared that her normal billing rate was $275.00 an hour, that she had been specializing in elder abuse cases for three years and that she had served as second counsel in over 10 jury trials and arbitrations. Given this evidence, and the trial judge's presumed experience and knowledge about the value of legal services prevailing in his community, nothing in the record compels us to disturb the trial court's discretionary determination that the hourly rate sought by plaintiffs was appropriate. (See Excelsior Union High School Dist. of Los Angeles County v. Lautrup (1969) 269 Cal.App.2d 434, 448 ["of course, the trial judge is himself an expert in the matter of attorney fees. '" . . .'The value of attorney's services is a matter with which a judge must necessarily be familiar. When the court is informed of the extent and nature of such services, its own experience furnishes it with every element necessary to fix their value.' [Citations.]"' (Italics added.) [Citation.]"]; Fed-Mart, supra, 111 Cal.App.3d at p. 227 ["An award for attorney fees may be made in some instances solely on the basis of the experience and knowledge of the trial judge without the need to consider any evidence"].)
DISPOSITION
The trial court's judgment and award of attorneys' fees on respondents' section 1430 claim is affirmed. The trial court's judgment on respondents' negligence claim is reversed to the extent it awards respondents $171,000 in economic damages and is remanded with the following orders: (1) Respondents' economic damages shall be reduced by $75,000 to offset the Los Alamitos settlement; (2) the trial court shall conduct further proceedings to determine: (a) whether the allocation of settlement proceeds in the Gardena settlement was made in good faith, and (b) whether Country Villa is entitled to a reduction of respondents' economic damages based on the amounts Cleopatra's insurers were actually required to pay for her medical services. The parties shall bear their own costs on appeal.
ZELON, J. We concur:
WOODS, Acting P. J.
JACKSON, J.