Developments of Interest

New Cases of Interest - June 5, 2012

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Jamulians Against the Casino v. Dougherty (2012) 205 Cal.App.4th 632.  This is a case which is decided on demurrer, with the trial court sustaining the demurrer without leave to amend, but is reversed by the court of appeal on an issue relating to a request for judicial notice.  The trial court had granted a request for judicial notice and had taken into account in ruling on the demurrer the substance of a document for which the request for judicial notice had been filed.  The court of appeal found this was improper, in that a request for judicial notice doesn’t convert a hearing on a demurrer into an evidentiary hearing.  A court on demurrer can take notice of the existence of a document by a request for judicial notice, but its contents can only be considered if the document has findings of fact, conclusions of law, orders and judgments.

Hartnett v. Crosier (2012) 205 Cal.App.4th 685.  A former employee of a county office of education brought an action against several other employees of that office alleging that they retaliated against him in violation of Education Code §44113(a) and seeking punitive damages and attorneys fees under Education Code §44114.  The court held that while the punitive damage claim was not available, the plaintiff had stated a claim under Education Code §44113(a) which allows such an action against persons who exercise supervisory authority over personnel actions when that authority is used to interfere with a public school employee’s rights under the Reporting by School Employees of Improper Governmental Activities Act (Education Code §§44110-44114.)

Husain v. McDonald’s Corp. (2012) 205 Cal.App.4th 860.  This was an action by a franchisee against McDonald’s, the franchisor, to continue operating three restaurants pending a trial on a contract dispute.  The franchise agreement had language which indicated that it was important to the business that there be a close personal working relationship between the franchisor and the franchisee.  The franchisor opposed the preliminary injunction on the basis that injunctions cannot be granted with respect to personal service contracts.  The court held however that the language in the franchise agreement did not convert the business being operated through the franchise to a personal services contract and did not rise to the level of the special relationship required or the special knowledge or skill possessed by a party performing a personal services obligation.  Under the circumstances presented, an injunction was appropriate.

Bush v. Horizon West (2012) 205 Cal.App.4th 924.  A nursing facility and its operators sought to compel arbitration claims asserted against them by a former resident and the resident’s daughter for elder abuse and negligent infliction of emotional distress.  There was a written agreement with the resident which required arbitration of disputes, but no written agreement with the resident’s daughter.  The trail court denied arbitration on the basis of potential inconsistent results pursuant to CCP §1281.2(c), and that determination was upheld on appeal.  The court noted that for CCP §1281.2(c) to apply, a party to the arbitration agreement must also be a party to a pending court action or special proceeding with a third party arising out of the same transaction or a series of related transactions, and there must also be a possibility of conflicting rulings on a common issue of law or fact.  The daughter here was a third party within the meaning of CCP §1281.2(c) and the daughter was not bound by the arbitration agreement based on the California Supreme Court’s decision in Ruiz v. Podolsky (2010) 50 Cal.4th 838. 

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