PROFESSIONAL LIABILITY UPDATES

The Second District holds that an attorney who discloses work product to counsel for mutual clients waives his or her work product privilege as to those clients. The court reserved for another day the question of whether the work product privilege belongs to the attorney or the client.


Collins v. State of California (2004) 121 Cal.App.4th 1112 (rev. denied 12/1/04);
December 15, 2004 [Issue 204]

The Third District holds that an attorney, who inadvertently contacts an opponent’s expert, receives no confidential information, and acts ethically once notified of the improper contact should not be disqualified as counsel.


Flatley v. Mauro (2004) 121 Cal.App.4th 1523;
December 15, 2004 [Issue 203]

The Second District holds that an attorney’s extortionate threats are not constitutionally protected conduct and are not entitled to the benefit of California’s anti-SLAPP (Strategic Lawsuit Against Public Participation) summary procedures.

Mink v. Maccabee (2004) 121 Cal.App.4th 835;
December 15, 2004 [Issue 202]

The Second District holds that a fee-splitting agreement between lawyers does not require the client’s written consent prior actual division of fees.

Rietveld v. Rosebud Storage Partners, L.P. (2004) 121 Cal.App.4th 250;  
November 18, 2004 [Issue 201] 

The Third District holds that local rules, which include sanctions against counsel, do not conflict with state law and are enforceable. 

Vega v. Jones, Day, Reavis & Pogue (2004) 121 Cal.App.4th 282 (rev. den. 10/27/04); 
November 18, 2004 [Issue 200] 

The Second District holds that there are no barriers to a non-client's claim of fraud against transactional counsel who actively conceal facts material to the transaction.

Borissoff v. Taylor & Faust (2004) 33 Cal.4th 523; 
November 15, 2004 [Issue 199] 

The California Supreme Court decides that the Probate Code gives a successor fiduciary standing to sue tax counsel retained by predecessor fiduciary. 

Derivi Const. & Architecture, Inc. v. Wong (2004) 118 Cal.App.4th 1268; 
November 15, 2004 [Issue 198] 

The Third District holds that a marital relationship between a disqualified attorney and replacement counsel does not result in automatic disqualification of replacement counsel.

Jasmine Networks, Inc. v. Marvell Semiconductor, Inc. (2004) 117 Cal.App.4th 794 (rev. granted 7/21/04); 
November 9, 2004 [Issue 197] 

The California Supreme Court accepts a case from the Sixth District that holds that client participation in an inadvertent disclosure of an attorney-client communication waives the privilege. Where there is an inadvertent disclosure the court may consider the content of the communication to evaluate whether the crime-fraud exception to the privilege applies. 

Venture Law Group v. Superior Court (Singhania) (2004) 118 Cal. App. 4th 96; 
November 8, 2004 [Issue 196] 

The Sixth Appellate District holds that a successor corporation succeeds to the attorney-client privilege of a prior corporation. Prior management cannot expressly or impliedly waive the privilege by asserting an advice of counsel defense. Implied waiver based on this defense can only be asserted against the corporate client. 

Brown v. Superior Court (2004) 116 Cal.App.4th 320 (rev. den. May 19, 2004); 
November 1, 2004 [Issue 195] 

The Third District holds that a contractual attorney’s fee lien can take priority over a statutory judgment lien perfected later in time. A separate action must be filed to enforce an attorney’s fee lien, but a court considering an application to satisfy a judgment lien should take into consideration priority attorney’s fees liens. 

Top Gold v. Weissman (2004) 114 Cal.App.4th 1195; 
September 9, 2004 [Issue 194] 

The Second District holds the statute of limitations was tolled while the attorney continued to represent the client on tangential matters. 

Stasz v. Schwab 2004 WL 1753263 (Cal.App.2d dist.); 
September 9, 2004 [Issue 193] 

The Second District affirms dismissal of the American Arbitration Association from a suit based upon the common-law doctrine of arbitral immunity. 

Janik v. Rudy, Exelrod & Zieff, 04 C.D.O.S. 5507; 
August 27, 2004 [Issue 192] 

Division Three of the First District holds that class counsel owes a duty of care to members of a certified class with respect to claims beyond the scope of the class certification order. 

Siebel v. Mittlesteadt (2004) 118 Cal.App.4th 406; 
August 17, 2004 [Issue 191] 

Division Six holds that post-judgment settlements do not automatically preclude a finding that a matter terminated favorably. 

Fletcher v. Davis (2004) 33 Cal.4th 61; 
August 6, 2004 [Issue 190] 

A lien against a client's future judgment or recovery is an interest adverse to the client and must comport with the informed written consent requirements of Rule 3-300 of the Rules of the Professional Conduct. 

Olmstead v. Arthur J. Gallagher & Co. (2004) 32 Cal.4th 804; 
July 19, 2004 [Issue 189] 

The California Supreme Court holds that sanctions under C.C.P. § 128.5 and § 128.7 are mutually exclusive. Broad sanctions under C.C.P. § 128.5 are not available in any case filed after December 31, 1994. 

BGJ Associates v. Jeff Wilson, et al. (2003) 113 Cal.App.4th 1217; June 17, 2004 [Issue 188] 

Violation of the Rule of Professional Conduct against entering into business transactions with a client subjects an attorney to disciplinary proceedings, but is not a basis for civil liability without a corresponding statutory or common law proscription. 

Citi-Wide Preferred Couriers, Inc. v. Golden Eagle Insurance Corporation (2003) 114 Cal.App.4th 906; 
June 15, 2004 [Issue 187] 

The Second District reverses an order dismissing a malicious prosecution action arising from an insurer's action for additional premiums. A malicious prosecution action may be maintained where most but not all of the amount sought in the prior action was claimed without probable cause. The insurer's abandonment of the case and acknowledgment that the premium was paid constituted a favorable termination. 

Hagberg v. California Federal Bank (2004) 32 Cal.4th 350; 
June 2, 2004 [Issue 186] 

The California Supreme Court holds that the litigation privilege protects all reports of criminal activity to law enforcement. 

Snider v. Superior Court (Quantum Productions, Inc.) (2003) 113 Cal.App.4th 1187; 
June 1, 2004 [Issue 185] 

The Fourth District refuses to disqualify an attorney for ex-parte contacts with an opposing party's mid-level employees. California's Rule of Professional Conduct precluding contact with a represented party is to be read narrowly to protect the competing policies of preservation of the attorney-client relationship and zealous representation by attorneys. An organization's attorney should take proactive steps to avoid employee contact with opposing counsel. 

Rico v. Mitsubishi Motors Corporation, et al. (2004) 116 Cal.App.4th 51 (rev. granted 6/9/04); 
May 20, 2004 [Issue 184] 

The Supreme Court has accepted review of a case from the Fourth District that holds an attorney, who inadvertently receives privileged documents, has an ethical and legal duty to refrain from examining them any more than is necessary to determine that they are privileged and to immediately notify the sender. Failure to do so may be grounds for disqualification. 

Jespersen v. Zubiate-Beauchamp (2003) 114 Cal.App.4th 624
May 20, 2004 [Issue 183] 

The District denies an attorney’s Special Motion to Strike a legal malpractice action under California’s Anti Strategic Lawsuit Against Public Participation (“anti-SLAPP”) statute. “Garden variety” attorney malpractice is not conduct in furtherance of a right of petition or free speech. 

A.I. Credit Corp. v. Aguilar & Sebastinelli (2003) 113 Cal.App.4th 1072; May 20, 2004 [Issue 182] 

The First District holds that an attorney disqualified for violating conflict of interest ethical rules is not entitled to fees. 

Moore v. Shaw (2004) 04 C.D.O.S. 1698; 
May 13, 2004 [Issue 181] 

The Second District denies an attorney's Special Motion to Strike under California's Anti-Strategic Lawsuit Against Public Participation statute where the complaint alleged the attorney engaged in intentional or negligent breach of trust in the estate planning context. Drafting a document related to a private transaction that is not connected to a judicial proceeding or an issue of public interest is not an act in furtherance of a right of petition or free speech. 

Viner v. Sweet 04 C.D.O.S. 3533; April 27, 2004 [Issue 180] 

The Second District applies the “but for” causation standard in the same legal malpractice case that reaffirmed the rule for transactional malpractice cases and grants defendant attorney’s motion for judgment notwithstanding the verdict on five out of seven claims. 

Aguilar v. Lerner (2004) 04 C.D.O.S. 3476; April 22, 2004 [Issue 179] 

The California Supreme Court decides that a binding fee dispute arbitration provision in a 1994 attorney-client fee contract is valid when the client waives the mandatory, non-binding, fee arbitration statutory scheme by filing a legal malpractice claim. 

Zamos v. Stroud (2004) 04 C.D.O.S. 3369; April 21, 2004 [Issue 178] 

The California Supreme Court holds that an attorney may be liable for malicious prosecution if he or she commences an action with probable cause, but continues to pursue the action after discovering facts that negate probable cause. 

HLC Properties Limited v. Superior Court of Los Angeles (2003) 112 Cal.App.4th; April 19, 2004 [Issue 177] 

The Second District decided that the attorney-client privilege passes to the legal successor of a predecessor business organization. The Supreme court has accepted review of this decision. 

Rus, Miliband & Smith v. Conkle & Olesten (2003) 114 Cal.App.4th 656; April 16, 2004 [Issue 176] 

The Fourth District holds that a contingency fee attorney who voluntarily withdraws from a case is not entitled to a quantum meruit fee from the recovery. 

Glassman v. McNab (2003) 112 Cal.App.4th 1593 (review denied 2/18/04); March 30, 2004 [Issue 175] 

The Second District refuses to disturb an attorney fee arbitration award where the parties had conferred by stipulation jurisdiction on the arbitrators to determine an issue of subject matter jurisdiction: the existence of an attorney-client relationship. 

Pour Le Bebe, Inc. v. Guess? Inc. (2003) 112 Cal.App.4th 810 (rev. den. 01/14/04); March 18, 2004 [Issue 174] 

The Second District decides that the trial court lacks jurisdiction to set aside an arbitration award based on an attorney’s ethical violation where there is no clear and convincing evidence that the violation affected the award. 

Edward M. Wolkowitz v. Redland Insurance Company, et al. (2003) 112 Cal.App.4th 154; March 9, 2004 [Issue 173] 

A bankruptcy court’s allowance of a claim in an uncontested proceeding does not satisfy the damages element of a legal malpractice claim. 

Huskinson & Brown, LLP v. Wolf (2004) 04 C.D.O.S. 1473; March 4, 2004 [Issue 172] 

The California Supreme Court decides that failure to comply with the ethical rule requiring written client consent to fee divisions does not preclude recovery on the basis of quantum meruit. 

Shooker v. Superior Court (Winnick) (2003) 111 Cal.App.4th 923; February 5, 2004 [Issue 171] 

The Second District holds that a party designated as an expert witness waives the attorney-client privilege unless the designation is withdrawn prior to the disclosure of privileged communications or substantive testimony as an expert. 

Jarrow v. LaMarche (2003) 31 Cal.4th 728; January 29, 2004 [Issue 170] 

The California Supreme Court holds that malicious prosecution actions brought against litigants and their attorneys are subject to scrutiny under California's anti-Strategic Lawsuit Against Public Participation statute. 

Hetos Investments, Ltd. V. Todd Kurtin (2003) 110 Cal.App.4th 36; January 20, 2004 [Issue 169] 

The Fourth District holds that a law firm is not necessarily disqualified from representing its clients in a lawsuit that challenges the enforceability of a legal document prepared by the firm. 

Barnard v. Langer (2003) 109 Cal.App.4th 1453; January 12, 2004 [Issue 168] 

The Second Appellate District finds that an inadequate settlement claim is speculative without proof of the underlying adversary's willingness to pay a higher settlement or proof of a better trial result. In addition, the tension between attorney's fees and the client's interest is not a conflict of interest. Finally, abusive client conduct concerning fee claims is sanctionable. 

Moore v. Anderson, Zeigler, Disharoon, Gallagher & Gray (2003) 109 Cal. App. 4th 1287; December 16, 2003 [Issue 167] 

The First Appellate District holds that an attorney has no duty to beneficiaries under a will to ascertain the testamentary capacity of a client seeking to amend an estate plan. 

Mansell v. Otto (2003) 108 Cal.App.4th 265; December 16, 2003 
[Issue 166] 

The Second District holds that the litigation privilege will not bar invasion of privacy claims in the litigation context for non-communicative conduct. However, there is no cause of action for invasion of privacy where confidential records are obtained through legitimate court process. 

Howard H. Hall v. Superior Court 03 C.D.O.S. 4000; November 17, 2003 [Issue 165] 

An attorney has no duty to persons who have claims related to his or her client’s, but who have not sought the attorney’s advice. 

Koo v. Rubio's Restaurants, Inc. (2003) 109 Cal.App.4th 719; November 10, 2003 [Issue 164] 

In the context of a disqualification motion the Fourth District confirms that the existence of an attorney-client relationship is a question of law evaluated by the totality of the circumstances. The relationship cannot be created by the declaration of one party; it requires mutual assent. However, managing agents of a corporation are "represented parties" for the purpose of California Rule of Professional Conduct Rule 2-100's bar on ex-parte contacts with a party known to be represented by counsel. 

Orrick Herrington & Sutcliffe v. Superior Court; November 6, 2003
[Issue 163] 

To establish a claim of "negligent settlement", plaintiff must prove his opponent in the underlying matter would have settled on more favorable terms or that there would have been a better result at trial. 

Drum v. Bleau, Fox & Associates (2003) 107 Cal.App.4th 1009; October 28, 2003 [Issue 162] 

The Second District decides that the ulterior motive element of an abuse of process claim may be inferred from willful misuse of court process. The Court also held "non-communicative" conduct in the context of a judicial proceeding is not protected by the litigation privilege. 

Olson v. Cohen (2003) 106 Cal.App.4th 1209; October 22, 2003 
[Issue 161] 

A law corporation that fails to register with the State Bar of California is not required to disgorge legal fees where there is no allegation that any client either relied upon the existence of a corporate entity or was injured by the law corporation's delinquency. 

Canton Poultry and Deli, Inc. v. Stockwell, Harris, Widom & Wolverton (2003) 109 Cal. App. 4th 1219; October 16, 2003 [Issue 160] 

The Second District holds that an attorney owes no duty to an employer who was dismissed from a worker's compensation action after its insurer accepted responsibility for the worker's claim. 

Dahl v. Rosenfeld (9th Cir. 2003) 316 F.3d 1074; August 22, 2003 
[Issue 159] 

The U.S. District Court of Appeals for the 9th Circuit holds that when a legal malpractice claim requires a court to interpret a Collective Bargaining Agreement it is preempted by §301 of the Labor Management Relations Act. 

1-800 Contacts, Inc. v. Steinberg (2003) 107 Cal.App.4th 568; August 20, 2003 [Issue 158] 

The California Court of Appeal for the Second District holds CCP § 425.16 will apply to cases arising out of constitutionally protected activity, even where it is alleged the activity was illegal. 

Zamos v. Stroud 03 C.D.O.S. 5831; July 25, 2003 [Issue 157] 

The Second Appellate District, Second Division holds an attorney can be liable for malicious prosecution for continuing to prosecute a lawsuit after the discovery of facts showing the case has no merit. 

Bird, Marella, Boxer & Wolpert v. Superior Court (Reiner) 106 Cal.App.4th 419; July 11, 2003 [Issue 156] 

The Second District distinguished prior case law that mandated a criminal malpractice plaintiff establish actual innocence and post conviction relief. In a dispute over an unconscionable or fraudulent fee, the actual innocence requirement does not apply. 

Viner v. Sweet (June 23, 2003, No. S101964)
<http://www.courtinfo.ca.gov/courts/supreme>;
June 23, 2003 [Issue 155] 

California Supreme Court holds that plaintiffs in transactional malpractice actions must prove that but for the malpractice, there would have been a more favorable result. 

Ferguson v. Lieff, Cabraser, Heimann & Bernstein (Cal. Supreme Court No. S104444); June 9, 2003 [Issue 154] 

California Supreme Court holds that attorneys cannot be liable for "lost" punitive damages. 

Fletcher v. Carlyle Davis 03 C.D.O.S. 1495; (Cal. Supreme Court has granted review of this case) May 28, 2003 [Issue 153] 

A law firm does not need to establish the existence of an unwritten lien in a separate action prior to filing claims against third parties who disburse the proceeds of a settlement or judgment with knowledge of the lien. 

Navellier v. Sletten (2003) 106 Cal.App.4th 763; May 15, 2003 
[Issue 152] 

On remand from the California Supreme Court, the First District holds that the litigation privilege does not automatically bar a complaint based on the Constitutionally protected activity of the right to petition. It also holds that the litigation privilege will not preclude liability for breach of contract. 

Shafer v. Berger, Kahn, Shafton, Moss, Figler, Simon & Gladston 03 C.D.O.S. 2402; April 14, 2003 [Issue 151] 

The Second District, Division One, holds that an attorney retained to provide coverage advice can be liable to a claimant for making a fraudulent statement about coverage. 

Huskinson v. Wolf (2002) 98 Cal.App.4th 113 (Rev. granted 7/24/02); March 31, 2003 [Issue 150] 

The California Supreme Court has accepted a decision from the Second District that denied attorneys fees under any theory, including quantum meruit, to a referring attorney who had performed services to the client. The panel decided that the law firm’s failure to comply with the ethical rule requiring written client consent to fee divisions was fatal to its claim. 

Ferguson v. Lieff, Cabraser, Heimann & Bernstein LLP (Cal. Supreme Ct. No. S104444); March 14, 2003 [Issue 149] 

California Supreme Court hears oral argument on whether attorneys can be liable for “lost” punitive damages. 

Olmstead v. Arthur J. Gallagher & Co. (2002) 104 Cal.App.4th 858; March 4, 2003 [Issue 148] 

The First District holds that sanctions under C.C.P. § 128.5 are still available for misconduct unrelated to the filing of pleadings. 

Leasequip, Inc. v. Dapeer (2002) 103 Cal.App.4th 394; February 20, 2003 [Issue 147] 

An attorney may be equitably estopped from raising the bar of the statute of limitations. 

White v. Lieberman (2002) 103 Cal.App.4th 210; February 7, 2003 
[Issue 146] 

The Second District holds that the statute of limitations for malicious prosecution actions arising from cases reversed on appeal begins to run on the date remittitur is entered. It also holds that attorneys may rely upon C.C.P. § 425.16, the anti-SLAPP statute, to attack malicious prosecution actions. 

Rojas v. Los Angeles County Superior Court (Coffin) (2002) 102 Cal.App.4th 1062 (rev. granted 1-15-03); January 22, 2003 [Issue 145] 

The California Supreme Court has accepted for review a decision from the Second District that holds the mediation privilege is co-extensive with the work product doctrine. The privilege does not protect purely evidentiary materials from discovery, and derivative materials can be discovered upon a showing of good cause. 

City of Hope v. Bryan Cave (2002) 102 Cal.App.4th 1356; January 13, 2003 [Issue 144] 

The Second District holds that attorneys are not third party beneficiaries to their client’s settlement agreements. 

Morrison v. Rudolph (2002) 103 Cal.App.4th 506; January 3, 2003 
[Issue 143] 

The Fourth District holds that unless an attorney is aware of specific factual errors, he or she will not be liable for malicious prosecution for initiating an action based on a client’s version of events. 

Mix v. Tumanjan Development Corporation (2002) 102 Cal.App.4th 1318; November 26, 2002 [Issue 142] 

An attorney in propria persona may recover reasonable attorneys’ fees incurred for attorneys assisting him, even if they do not appear as counsel of record. 

Stroock & Stroock & Lavan v. Tendler 02 C.D.O.S. 9838; November 21, 2002 [Issue 141] 

The Second District holds that the malicious prosecution "interim adverse judgment rule" does not apply to a ruling that does not address the merits of the underlying claim. 

Chambers v. Kay 02 C.D.O.S 10913; November 14, 2002 [Issue 140] 

The Supreme Court holds that fee division arrangements between counsel that do not comport with the ethical requirement of written client consent cannot be enforced. 

Ross v. Creel Printing & Publishing Company, Inc, et al. (2002) 100 Cal.App.4th 736; November 4, 2002 [Issue 139] 

The First District holds that a violation of the Rules of Professional Conduct cannot form the basis for an intentional infliction of emotional distress claim. 

New Plumbing Contractors, Inc. v. Edwards, Sooy & Byron (2002) 99 Cal.App.4th 799; October 25, 2002 [Issue 138] 

The Fourth District holds that an insured client cannot establish liability against its attorney for negotiating a settlement within policy limits when the policy gives the insurer absolute discretion to settle. 

Pangborn Plumbing Corporation v. Carruthers & Skiffington, et al. (2002) 97 Cal.App.4th 1039; October 9, 2002 [Issue 137] 

A contractual lien for attorney's fees has priority over a subsequently filed judgment lien. 

Swat-Fame v. Goldstein 02 C.D.O.S. 7873; October 2, 2002 [Issue 136] 

The Second District holds that an attorney is entitled to rely on the representations of his or her client in determining whether probable cause exists to file a claim. 

Glen K. Jackson, Inc. v. Richard Roe (9th Cir. 2001) 273 F.3d 1192; September 23, 2002 [Issue 135] 

Auditors hired by a client to audit attorney’s bills owe the attorney no duty of care. 

Mattel, Inc. v. Luce, Forward, Hamilton & Scripps and James B. Hicks (2002) 99 Cal.App.4th 1179; September 18, 2002 [Issue 134] 

The Second District holds that settlement of an underlying suit may not operate to negate favorable termination and may not support an “anti-SLAPP” motion to strike. 

Lynch v. Warwick (2002) 95 Cal.App.4th 267; September 3, 2002
[Issue 133] 

“Actual innocence” requirement for legal malpractice claim against criminal defense attorney applies regardless of whether former client claims damages from a wrongful conviction, a longer sentence, or attorney fees. 

Ted L. Vanzant v. DaimlerChrysler Corporation (2002) 96 Cal. App. 4th 1283; August 26, 2002 [Issue 132] 

The Second District holds that there can be no liability for continuation of a properly initiated existing proceeding. 

McPhearson v. The Michaels Co. (2002) 96 Cal.App.4th 843, City National Bank v. Adams (2002) 96 Cal.App.4th 315; August 12, 2002 [Issue 131] 

The Third District holds that a confidentiality provision in a settlement agreement for one client does not preclude an attorney from representing another client against the same defendant. The Second District holds that an attorney who had drafted an opinion letter concerning a loan for his bank client is disqualified from representing the borrower in subsequent litigation about the loan. 

Wilson v. Parker, Covert & Chidester 02 C.D.O.S. 69109; Jarrow Formulas, Inc v. Sandra Hogan LaMarche 02 C.D.O.S. 2706 (rev. granted 6/12/02); August 5, 2002 [Issue 130] 

The California Supreme Court holds that denial of a C.C.P. § 425.16 special motion to strike establishes probable cause in a subsequent malicious prosecution action. The Court accepts a decision permitting an attorney to utilize a C.C.P. § 425.16 special motion to strike in a malicious prosecution action. 

English v. IKON Business Solutions, Inc. (2001) 94 Cal. App. 4th 130; Gotschall v. Daley (2002) 96 Cal.App.4th 479; July 29, 2002 [Issue 129] 

The Third District holds that mandatory relief under CCP § 473(b) based on an attorney’s mistake, inadvertence, surprise or neglect is not available to vacate an order granting summary judgment due to attorney error or a dismissal based on a failure to disclose a causation expert. 

Gomez v. Vernon (9th Cir. 2001) 255 F.3d 1118; July 22, 2002 [Issue 128] 

The Ninth Circuit Court of Appeals has affirmed sanctions ordered after counsel acquired and used an inmate’s privileged and confidential materials. 

STI Outdoor LLC v. Superior Court (2001) 91 Cal.App.4th 334; July 15, 2002 [Issue 127] 

A necessary disclosure to a third party does not waive the attorney-client privilege. 

Garretson v. Miller 02 C.D.O.S 5553; July 10, 2002 [Issue 126] 

The Third District holds that a Plaintiff’s burden to demonstrate that an underlying judgment was collectible includes a showing that the underlying defendants could satisfy all or a portion of an underlying judgment. 

O'Connor Agency, Inc. v. Brodkin 02 C.D.O.S. 4826; July 9, 2002 
[Issue 125] 

Division Three of the Fourth District has ruled that "lost" punitive damages are recoverable as compensatory damages in a legal malpractice action. It also ruled that the statute of limitations does not begin to run until a Court of Appeal decides against a party who succeeded in the trial court. 

Musser v. Provencher 02 C.D.O.S 5815; American Equity v. Beck 02 C.D.O.S 5812; July 8, 2002 [Issue 124] 

The California Supreme Court has endorsed a case-by-case analysis in determining the propriety of attorney-to-attorney indemnity actions when an attorney seeks recovery for his or her malpractice losses against concurrent or co-counsel. Furthermore, the Court has ruled it is not an impermissible assignment for an insurer to succeed to such an indemnification claim. By contrast, when an attorney seeks recovery from another attorney for fees lost due to the other attorney’s malpractice against a mutual client, the Court has determined that a bright line rule of “no duty” precludes recovery. 

Borissoff v. Taylor 02 C.D.O.S 1734 (rev. granted 5/15/02); July 3, 2002 [Issue 123] 

The California Supreme Court has accepted a case that held an attorney representing an administrator of an estate owes no duty to a successor executor. 

Videotape Plus, Inc. v. Lyons (2001) 89 Cal.App.4th 156; July 1, 2002 [Issue 122] 

Probable cause must support even “superfluous” causes of action to avoid potential malicious prosecution liability. 

Home Insurance Company v. Zurich Insurance Company; May 14, 2002 [Issue 121] 

The Third District holds that an attorney’s misrepresentation of his client’s insurance policy limits is privileged under California Civil Code §47(b). 

Ferguson v. Lieff, Cabraser, Heimann & Bernstein (2002) 115 Cal.Rptr.2d 342; May 2, 2002 [Issue 120] 

On May 1, 2002, the California Supreme Court voted unanimously to review a First District decision that punitive damages recoverable in an underlying case are not recoverable as compensatory damages in a legal malpractice action. 

Kravitz v. Superior Court (2001) 91 Cal.App.4th 1015; May 1, 2002 [Issue 119] 

The Fourth District decides that pro se litigants cannot recover attorney’s fees as a discovery sanction. 

Chavez v. Mendoza (2001) 94 Cal.App.4th 1083; April 3, 2002 [Issue 118] 

A malicious prosecution action may be the subject of a special motion to strike under CCP §425.16, the anti-SLAPP statute. 

Gursey, Schneider & Co. et al, v. Wasser, Rosenson & Carter et al., (2001) 90 Cal.App.4th 1367 (rev. granted, 11/14/01); March 5, 2002 [Issue 117] 

The California Supreme Court accepts for review an opinion from the Second District that holds public policy does not bar an equitable indemnity claim by accountants against attorneys who jointly represented a client. 

Samuel Myers v. The Bennett Law Offices, et al. (9th Cir. 2001) 238 F.3d 1068; February 21, 2002 [Issue 116] 

A Utah law firm that ordered a credit report on Nevada residents had sufficient contacts to warrant personal jurisdiction in Nevada. 

State Farm Fire & Casualty Co. v. Pietak (2001) 90 Cal.App.4th 600; February 11, 2002 [Issue 115] 

Straightforward admission of fault by attorney is required to qualify for mandatory relief from default under Code of Civil Procedure § 473. 

Lombardo v. Huysentruyt (2001) 91 Cal.App.4th 656; December 5, 2001 [Issue 114] 

Judicial error is not a superceding cause precluding attorney liability for conduct below the standard of care.  

Ferreira v. Gray, Carey, Ware & Freidenrich, et al. (2001) 87 Cal.App.4th. 409; November 30, 2001 [Issue 113] 

The Fourth District has decided that two traditional elements of malicious prosecution actions will be stringently applied. In one case the court held that a voluntary settlement after a verdict negates the favorable termination element. In another case, which has been accepted for review by the California Supreme Court, the court ruled that summary judgment or other dispositive motion in the underlying case establishes probable cause as a matter of law. 

Farmers Insurance Exchange v. Law Offices of Conrado Joe Sayas, Jr. 250 F.3d 1234 (9th Cir. (Cal.) 2001); October 30, 2001 [Issue 112] 

The Ninth Circuit has allowed concurrent counsel engaged in a fee dispute with their client to recover prevailing party attorneys’ fees when the attorneys represent each other in the fee dispute. When a fee contract provides for recovery of attorneys’ fees by the prevailing party, attorneys may recover fees paid to their own counsel. The fees must be incurred in the context of a valid attorney-client relationship where the interests of the attorney and the client are distinct. The California Supreme Court holds a corporation may recover attorneys’ fees for the reasonable value of the services of in-house counsel. 

Aguilar v. Lerner (2001) 1 C.D.O.S. 5392 (rev. granted 10/17/01); October 23, 2001 [Issue 111] 

The First District permits enforcement of a binding fee dispute arbitration provision in an attorney-client fee contract where the client fails to avail himself of the protections of the statutory non-binding fee dispute arbitration provisions. The Supreme Court has accepted the case for review.  

Foxgate Homeowner’s Association Inc., v. Bramalea California Inc. (2001) 26 Cal.4th 1; October 9, 2001 [Issue 110] 

The California Supreme Court has held that there are no exceptions to the mediation privilege of Evidence Code §§ 1119 and 1121. Mediation communications may not be disclosed in any subsequent proceeding by the mediator or by any party to the mediation. Conduct during mediations may be disclosed by a party, but not by the mediator. 

American Equity Insurance Co. v. Beck 01 C.D.O.S. 5395 (rev. granted 9/19/01); September 20, 2001 [Issue 109] 

The First District Court of Appeal, Division Three has rejected cross-complaints for indemnity between co-counsel endorsing a bright line rule. By contrast, Division Two has rejected a bright line rule in favor of a case-by-case analysis. The California Supreme Court has accepted review in both cases. 

Solin v. O’Melveny & Meyers, LLP; September 10, 2001 [Issue 108] 

The Second District has decided that an attorney who retained the services of counsel to advise him about representation of his own clients cannot pursue an action for legal malpractice over his client’s objections if to do so would intrude upon the attorney-client privilege. It also decided that shareholder derivative suits for legal malpractice do not violate the rule against assignment of legal malpractice actions. Nevertheless, they are barred because shareholders cannot waive the attorney-client privilege on behalf of the corporation. 

Sims v. Charness 01 C.D.O.S. 900; August 15, 2001 [Issue 107] 

The Second District finds the requirements of California Rule of Professional Conduct 2- 200, requiring written disclosure to and consent by clients to fee splitting arrangements between attorneys, do not apply where attorneys jointly work on a case. By contrast, in a case accepted for review by the Supreme Court, the First District decides that failure to strictly observe ethical rules will defeat an attorney’s fee claim against his co-counsel, even when the client’s rights are not affected. 

Simon et al. v. Steverson, et al. 01 C.D.O.S. 3269; July 23, 2001 
[Issue 106] 

A New York based attorney licensed in California who negotiated contracts with California residents under California law has sufficient contacts with the state to invoke subject matter jurisdiction. 

Coscia v. McKenna & Cuneo, 01 C.D.O.S. 5552, filed July 2, 2001; July 5, 2001 [Issue 105] 

The California Supreme Court has held that exoneration by post-conviction relief is a prerequisite to recovery for legal malpractice arising out of a criminal proceeding. The statute of limitations is not tolled during the pendency of post -conviction proceedings, but the legal malpractice action should be stayed while the legal malpractice claimant seeks post-conviction relief. The Court also decided that a Public Defender’s negligence generally does not qualify for immunity under the California Government Code. 

Cappiello, Hofman & Katz, P.C. v. Boyle (2001) 01 C.D.O.S. 2171; June 6, 2001 [Issue 104] 

The First District decided that an unregistered Legal Professional Corporation has no right to recover for either interference with contract or interference with prospective economic advantage when another attorney successfully solicits the firm’s clients. The failure to register constitutes the practice of law without a license rendering the firm’s attorney-client fee contracts illegal. 

Jeffrey H. v. Imai, Tadlock & Keeney (2000) 85 Cal.App.4th 345, as modified 1/3/01; April 16, 2001 [Issue 103] 

Three separate districts have taken three different approaches to the applicability of the litigation privilege to constitutional invasion of privacy claims. The first district ruled that the privilege cannot be applied without balancing the interests served by the litigation privilege against the constitutional right to privacy. The fourth district ruled that the interests should be balanced to ascertain whether the alleged invasion of privacy involves communicative or non-communicative conduct. The third district held that the litigation privilege is absolute, even in the context of a constitutional invasion of privacy claim. 

Michael Piscitelli v. Robert Friedenberg 01 C.D.O.S. 2093; March 15, 2001 [Issue 102] 

The Fourth Appellate District has ruled on five significant legal malpractice issues. First, there is a constitutional right to a jury trial in legal malpractice cases, even if a court or arbitrator would have decided the underlying case. Second, expert testimony on the likely result of an underlying case invades the province of the jury and is not admissible. Third, as the substitute arbiter of the underlying case, the legal malpractice jury is entitled to instruction on the rules and regulations that would have been considered in the underlying forum. Fourth, evidence admissible in the underlying action is admissible in the legal malpractice action with proper limiting instructions, if necessary. Fifth, punitive damages that would have been awarded against an underlying tortfeasor are not a compensable loss in a legal malpractice action. 

Wolf v. Mitchell, Silberberg & Knapp (1999) 76 Cal.App.4th 1030, rehearing denied 12/28/99, review denied 3/22/00; February 26, 2001 [Issue 101] 

Court held the beneficiary of a trust had standing to sue trustee's council under common law rule that beneficiary may use third parties who actively participate in a trustee's breach of trust. 

Knoell v. Petrovich (1999) 76 Cal.App4th 164, review denied 03/01/00; February 1, 2001 [Issue 100] 

Court applies litigation privilege to defeat defamation claim notwithstanding allegation of fraud. 

California State Automobile Ass'n Inter-Insurance Bureau v. Parichan, Renberg, Crossman & Harvey (2000) 84 Cal.App.4th 702; January 24, 2001 [Issue 99] 

Proof of the case-within-the-case is not required in trying transactional legal malpractice actions. The case-within-the-case requirement still applies to litigation legal malpractice claims.