Developments of Interest

New Cases of Interest - February 7, 2011

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Pineda v. Bank of America (2010) 50 Cal 4th 1389.  The Supreme Court holds that the same statute of limitations applies to Labor Code section 203, seeking penalties for failure to pay final wages, as also applies to Labor Code sections 201 or 202.  The penalties are not recoverable as restitution, however, under the California Unfair Competition law.  In reaching this decision, the Court overruled an earlier Appellate Court case, McCoy v. Superior Court, 157 Cal.App.4th 225.

Arnall v. Superior Court (2010) 190 Cal.App.4th 360.  A tax attorney provided legal services under contracts which provided for payment based upon, in part, the savings generated from those services.  The court found that this type of agreement was within the scope of Business and Professions Code section 6147 dealing with contingent fee agreements, likely also includes hybrid agreements having a portion of the fee payable as a fixed payment with a variable success fee.  Accordingly, the statement required in Business and Professions Code section 6147(a)(4), that success fees are not set by law but are negotiable between the attorney and client, needed to be included in the attorneys’ fee agreement, and the failure to do so, made that agreement voidable.

Greenwich S.F., LLC v. Wong (2010) 190 Cal.App.4th 739.  In this case the plaintiff was awarded $600,000 in lost profits, along with other damages, following a seller’s breach of a real property sales agreement.  Plaintiff argued that the lost profits were consequential damages resulting from the breach.  The court, however, reversed this element of the damage award, because the evidence was insufficient to show lost profits with the degree of reasonable certainty required by law.  The evidence failed to show that either the buyer or the buyer’s predessor in interest were already established businesses or had track records of successfully developing or redeveloping properties, which was a foundation upon which the lost profits claims would have to be based.  The proposed real estate development project had a number of variables that made any calculation of lost profits inherently uncertain, and therefore not recoverable as a matter of law.

Entezampour v. North Orange County Community College District (2010) 190 Cal.App.4th 832.  An employee of a community college district was not a tenured member of the faculty when he was hired for an administrative position as a Dean.  He had been employed only as a part time instructor.  The Community College District determined not to renew his employment as a Dean, and the employee sought reinstatement to a faculty position under Education Code section 87458, and when that position was denied, sought a writ of mandate compelling the College District to provide him with such a position.  The Court of Appeal overruled the trial court which had sustained a demurrer to the petition because the Court of Appeal found that the petition alleged sufficient facts to show that the conditions of both Education Code section 87458 and a separate community college district policy had been satisfied in order to allow plaintiff to attempt to make a factual showing that would support his claim.

Dana Pointe Safe Harbor Collective v. Superior Court (2010) 51 Cal.4th 1.  In this case a city subpoenaed certain documents and the trial court ordered the parties subpoenaed to comply with it.  When the matter was appealed by the parties receiving the subpoena to the Court of Appeal, the Court of Appeal declined to consider the merits of the decision.  The Supreme Court reversed the decision of the Court of Appeal, and found that the trial court’s order enforcing the city’s legislative subpoena was a final judgment that was subject to appeal under CCP §904.1(a)(1) because the order left nothing for the parties against whom the order was entered to do, except to comply. 

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