Opinion
NOT TO BE PUBLISHED
Appeal from a judgment of the Superior Court of Orange County, Super. Ct. No. 06CC03257, Andrew P. Banks, Judge.
Megan A. Richmond for Plaintiff and Appellant.
Clark Goldberg & Madruga, Roger W. Clark and Robert D. Goldberg for Defendant and Respondent.
OPINION
BEDSWORTH, ACTING P. J.
Kelly Combs appeals from a judgment in favor of Bruce Gary in this legal malpractice action, after Gary prevailed on a motion for summary judgment. Combs argues the statue of limitations does not bar the action and material facts are disputed. We disagree on the first point – we find the action was untimely – and so affirm.
FACTS
In October 2003, Dr. Walter F. Combs, having been diagnosed with terminal cancer, retained Gary to advise him on estate planning. Gary prepared a trust and related documents, which Dr. Combs executed on October 24, 2003. The trust made various bequests to Dr. Combs’ nine children from his first marriage, and to Lisa Combs, his former second wife. (Dr. Combs and Lisa Combs married in 1983, had a child, and divorced three years later, but they continued to live together as husband and wife.) Kelly Combs is one of Dr. Combs’ children from his first marriage. He was named as successor trustee of the trust, and given a power of attorney for financial matters.
The facts are drawn from the complaint, the parties’ separate statements of undisputed facts, and the evidence submitted on the motion for summary judgment.
Kelly Combs believed he formed an attorney-client relationship with Gary as a result of several telephone conversations in November and December 2003. Gary first called in mid-November 2003, identifying himself as attorney for the trust. He explained Kelly Combs’ duties as successor trustee, and asked for his help in transferring assets to the trust. Gary explained it was a matter of some urgency, given Dr. Combs declining condition.
In late November 2003, Gary told Kelly Combs of a meeting with Dr. Combs and Lisa Combs. As Kelly Combs recalled at his deposition, Gary told him “Lisa was going to try to get changes made to my father’s trust.” In another conversation around this time, Gary “advised me of undue influence by Lisa Combs over my father and her repeated attempts to have the Trust changed to her benefit. [Gary] informed me that he, my father, and Mr. Dul [Dr. Combs’ accountant] had lied to Lisa Combs about making the changes that she requested.” [Gary] told me to trust him because he was on my side in protecting the Trust and that he would not make the changes that Lisa Combs was requesting.” Gary also told Kelly Combs he had drafted a letter for Dr. Combs to sign “indicating that it is my father’s wish to not make the changes to the trust that Lisa had demanded . . . .” He asked Kelly Combs to assist in having Dr. Combs sign the letter. The plan was to meet at a bank where Dr. Combs had some documents to sign, but it never came about.
On December 9, 2003, Gary told Kelly Combs that his father was making confusing statements and lacked capacity, and “the cat was out of the bag . . . concerning the lie to Lisa.” (Apparently, Lisa Combs had learned the changes previously promised had not been made.) Kelly Combs asked what they were going to do. They discussed having Dr. Combs declared incompetent, but Gary “advised me not to worry, that he’s on my side. He told me that if we were to act [to have Dr. Combs declared incompetent], that . . . would trigger a lawsuit by Lisa. He said she would get some . . . lawyer . . . to go out and make the changes. Not to worry about it. He is going to protect the trust. I put my confidence in him.” During the conversation, Gary revealed he was planning to visit Dr. Combs at home the following day, to make changes to the trust. He did not say what they were. Kelly Combs asked why, given the lawyer’s belief that Dr. Combs lacked capacity. Gary “responded not to worry, I’m on your side.”
Dr. Combs amended his trust on December 10, 2003. The next day, the accountant told Kelly Combs changes had been made, but said he did not know what they were. Kelly Combs called Gary but was not put through. Despite numerous follow-up calls, Gary never spoke to him again.
On December 12, 2003, Kelly Combs and one of his brothers (Walter F. Combs, Jr.) met with an attorney (Jack Brown). “[W]e were there to ask him what to do since Bruce Gary no longer [would] speak to us and give us advice . . . . We [thought] something terrible [had] just happened. [¶] [W]e thought that Lisa may have just accomplished everything that she had been trying to accomplish . . . and that Bruce Gary had turned coat and was now representing her instead of me.” Already, Kelly Combs said at a later deposition, he had “lost confidence in Bruce Gary to protect the trust,” and believed “Bruce Gary had breached some obligation or duty that he owed” him.
In late December, Kelly Combs learned some of the changes that Dr. Combs made. Responding to a letter from Brown, Gary sent a redacted copy of the amendment, which showed Kelly Combs had been replaced as successor trustee (in favor of Lisa Combs’ father), and his power of attorney was revoked. Gary told Brown that Dr. Combs had instructed him not to discuss the changes with Kelly Combs or Walter F. Combs, Jr., among others. Dr. Combs died on December 31, 2003.
It appears Kelly Combs learned the substance of the trust amendment in late January 2004. At his deposition, he testified “I would not find out until late January [2004] about the new amendment.” In mid-February 2004, he hired new counsel (Megan A. Richmond) “to invalidate the [a]mendment in probate litigation.”
In August 2004, Kelly Combs filed a probate action to set aside the amendment because of undue influence and elder abuse by Lisa Combs. The petition alleged the amendment had substantially increased the bequest to Lisa Combs and reduced the bequest to Kelly Combs (and others), and attached a copy. The probate court found the amendment was valid and, under a no-contest provision of the trust, Kelly Combs forfeited his interest in the trust.
The instant action was commenced on February 17, 2007. The complaint alleged Gary entered into an attorney-client relationship with Kelly Combs in late November 2003, based on the conversations set out above. But, it alleged, Gary had a conflict of interest because he continued to represent Dr. Combs, gave advice to Lisa Combs, and was looking out for his own interest in avoiding a lawsuit by Lisa Combs. This conflict was never disclosed, and never waived. After speaking with Gary on December 9, 2003, Kelly Combs and Walter F. Combs, Jr. had been prepared to remove Dr. Combs from his home to get him away from Lisa Combs’ influence, and have him evaluated by a medical professional, but they decided not to, based on Gary’s assurance that he was on their side and would protect the trust. Contrary to these promises, Gary prepared a trust amendment that contained the changes requested by Lisa Combs, and it was signed by Dr. Combs.
Two causes of action were set out. The malpractice claim alleged Gary was negligent in failing to protect Kelly Combs and the trust. As a result, Kelly Combs took no action to get Dr. Combs away from Lisa Combs, incurred legal fees in unsuccessful litigation to challenge the trust amendment, and lost his interest in the trust. A breach of fiduciary duty claim alleged Gary entered into a fiduciary relationship with Kelly Combs and breached that duty by looking out for his own interests and those of Lisa Combs. Both compensatory and punitive damages were requested.
Gary moved for summary judgment on two grounds. First, he argued the action was barred by the one year statute of limitations. (Code Civ. Proc., § 340.6.) Second, Gary argued no attorney-client relationship existed between himself and Kelly Combs. The trial court agreed. It found the undisputed facts (set out above) established Kelly Combs had suspected Gary failed to perform his alleged obligations, and suffered actual injury as a result, by the end of February 2004. It also determined that Kelly Combs knew Gary was representing Dr. Combs, and he could not reasonably have believed Gary was representing his interests when they conflicted with those of Dr. Combs. Judgment was entered for Gary.
All subsequent statutory references are to the Code of Civil Procedure.
DISCUSSION
Appellant argues the February 16, 2006 filing was timely because the cause of action accrued on February 17, 2005, when he obtained certain information during Gary’s deposition in the probate matter. We disagree. It accrued much earlier, when he became suspicious of Gary’s conduct.
There are two key points in appellant’s argument that his action is not barred by the statute of limitations. First, Gary testified he was concerned about a possible malpractice action by Lisa Combs over his telling her the trust was being amended when it was not. Dr. Combs had told him in private not to make the changes, but this was kept from Lisa Combs. Appellant asserts Gary’s self interest compromised his promise to protect appellant and the trust. Instead, Gary protected himself with the amendment that satisfied Lisa Combs and eliminated the risk she might sue him.
Second, Gary testified about a December 10, 2003 letter of authorization and instructions, prepared by him and countersigned by Dr. Combs. The letter confirmed that Dr. Combs had reversed his position on Lisa Combs’ changes and was now instructing Gary to make them. It also authorized Gary “to charge my trust for any time you must spend (either while I am alive or after my death) to explain or testify regarding the changes to my trust.” Appellant asserts the letter shows Gary had a financial interest in changing the trust, which again compromised his representation. These two putative failures are the basis of appellant’s statute of limitations argument.
The letter also directed Gary not to discuss the trust changes with Kelly Combs, Walter F. Combs, Jr., Lisa Combs, or his accountant, Dul.
A malpractice action against an attorney generally must be brought “within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first.” (§ 340.6, subd. (a).) The running of the statute is tolled during the time “the plaintiff has not sustained actual injury,” among other events. (§ 340.6, subd. (a)(1).)
What amounts to discovery of a cause of action has long been settled. “Under the discovery rule, the statute of limitations begins to run when the plaintiff suspects or should suspect that her injury was caused by wrongdoing, that someone has done something wrong to her. . . . [Citation.] A plaintiff need not be aware of the specific ‘facts’ necessary to establish the claim; that is a process contemplated by pretrial discovery. . . . So long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her.” (Jolly v. Eli Lilly & Co. (1988) 44 Cal.3d 1103, 1110-1111, fn. omitted.) Likewise settled is the actual injury requirement. “The test for actual injury under section 340.6 . . . is whether the plaintiff has sustained any damages compensable in an action . . . against an attorney for a wrongful act or omission arising in the performance of professional services.” (Jordache Enterprises, Inc. v. Brobeck, Phleger & Harrison (1998) 18 Cal.4th 739, 751.)
This action came way too late. A malpractice claim against Gary accrued no later than 2004. By then appellant suspected his interest in the trust had been diminished and Gary was to blame, and he suffered actual injury. On December 12, 2003, after having learned changes had been made but not what they were, appellant already thought “Bruce Gary had breached some obligation or duty” owed him. He met with attorney Jack Brown that day, thinking “Lisa may have just accomplished everything she had been trying to accomplish.” He thought “Bruce Gary had turned coat and now was representing her instead of me.” Appellant paid legal fees to Brown in January 2004. Not satisfied with Gary’s response to Brown’s inquires, he retained Megan A. Richmond in February 2004 to set aside the amendment. And the extent of the changes was known no later that August 2004, when the probate action set out those changes and attached a copy of the disputed amendment. Were this a closer case, we would spend time setting an exact point at which the clock began ticking. But it is not. All we need say here is that at the latest, the cause of action accrued in August 2004. This February 2006 action was – at the very best – six months untimely.
Nor can there be any claim of tolling the statute of limitations for want of actual injury. The complaint alleged as damages legal fees to challenge the amendment, and the loss of appellant’s interest in the trust. But the fees were first incurred in January 2004 (Jack Brown) and February 2004 (an initial retainer to Megan A. Richmond), and appellant knew his interest in the trust had been reduced, if not lost, by the time the probate action was filed in August 2004. Good legal arguments can be constructed about where in that continuum the statute of limitations began to run, but none of them will excuse filing this action in February, 2006.
Appellant argues suit was timely because it was based on Gary’s conflict of interest (avoiding suit by Lisa Combs and earning fees from defending the amendment), and these facts did not emerge until the February 2005 deposition. But that reflects a mistaken understanding of the law. A cause of action accrues under the discovery rule when plaintiff suspects he has been harmed by his attorney, not when the details of that harm are confirmed. “A plaintiff need not be aware of the specific ‘facts’ necessary to establish the claim; that is a process contemplated by pretrial discovery. . . . So long as a suspicion exists, it is clear that the plaintiff must go find the facts; she cannot wait for the facts to find her.” (Jolly v. Eli Lilly & Co., supra, 44 Cal.3d at p. 1111.)
Appellant seeks refuge in a statement in Jolly that “a suspicion of wrongdoing, coupled with a knowledge of the harm and its cause, will commence the limitations period . . . .” (Jolly v. Eli Lilly & Co., supra, 44 Cal.3d at p. 1112.) He contends this means his cause of action did not accrue until he knew of Gary’s fear of Lisa’s malpractice suit, and Gary’s financial interest in changing the trust. But that misreads Jolly. The knowledge referred to in the quote is that of actual injury or harm, not the factual basis for an action. As the court explained, “[d]efendants argue that the statute should commence when the plaintiff knows of her injury and its factual cause. Although that position has been adopted in some jurisdictions . . . it is not the rule in California.” (Id. at p. 1109, fn. 4.)
Equally misplaced is appellant’s citation of two cases for the proposition that a malpractice action does not accrue until the plaintiff discovers the facts that show negligence. The first of them, Neel v. Magana, Olney, Levy, Cathcart & Gelfand (1971) 6 Cal.3d 176, was the decision that adopted an early version of the discovery rule for attorney malpractice actions. The court’s formulation was that the cause of action “does not accrue until the client discovers, or should discover, the facts establishing the elements of his cause of action.” (Id. at p. 194.) But the discovery rule has evolved in the ensuing years. The applicable law is the latest articulation of the rule in Jolly, not the initial one in Neel.
The other case is Samuels v. Mix (1999) 22 Cal.4th 1, 9, which appellant cites for the proposition that “a client’s delayed discovery of facts that constitute actionable malpractice will delay accrual of a cause of action.” But that is not quite accurate. In summarizing the history of the common law discovery rule, the court said almost what appellant claims, but it used the word “may” where he uses “will.” (Ibid.) The bigger problem, though, is that the common law rule was not in issue there – nor here. The issue in Samuels was who bears the burden of proving when the plaintiff discovered, or reasonably should have discovered, the facts constituting malpractice under section 340.6. The court held it is defendant. Since that is not an issue in the present case, Samuels is inapt.
Appellant also contends Gary is estopped from raising the statute of limitations because he advised appellant on December 9, 2003 not to seek an independent evaluation of his father’s competency or remove him from the influence of Lisa Combs. We think not.
The argument relies on a distinguishable case, Leasequip, Inc. v. Dapeer (2002) 103 Cal.App.4th 394, 403-404. There, an attorney advised his corporate client that it did not have to file with the Secretary of State a required statement of information, and failure to file would not affect its legal claims. The corporation later sued the attorney for malpractice. He demurred on the ground action was barred by the statute of limitations, arguing the corporation’s powers had been suspended for failure to register and were not reinstated until after the limitations period had run. The court held the attorney was equitably estopped to raise the statute of limitations defense, because the corporation had relied on his advice and was ignorant of the true facts, i.e., the correct rule, until the statue had run. Here, there is no claim appellant refrained from suing based on Gary’s advice. If anything, he refrained from seeking a competency evaluation. Were an argument to be raised that a competency evaluation was too late or was now barred, appellant might have a point. But this advice did not affect appellant’s suspicion, so it does not bar Gary from relying on the statute of limitations.
Since the cause of action against Gary accrued in 2004, this action filed in February 2006 was barred by the statute of limitations. The judgment appealed from is affirmed. Respondent is entitled to costs on appeal.
In light of our holding, we do not reach Kelly Combs’ argument there are triable issues concerning whether an attorney-client relationship or fiduciary relationship was formed between Gary and himself.
WE CONCUR: MOORE, J., ARONSON, J.