Judge: Stephen I. Goorvitch, Case: 21STCV18885, Date: 2023-05-24 Tentative Ruling

Case Number: 21STCV18885    Hearing Date: May 24, 2023    Dept: 39

D and M General Constructor, Inc. v. Joseph Daneshrad

Case No. 21STCV18885

Demurrer

BACKGROUND

            Plaintiff D and M General Constructor, Inc. (“Plaintiff”) filed this action against Joseph Daneshrad, Esq., (“Defendant”) asserting causes of action for professional negligence/legal malpractice, breach of contract, and declaratory relief.  Previously, the Court granted in part and denied in part a special motion to dismiss under Code of Civil Procedure section 425.16, commonly known as an anti-SLAPP motion.  The Court ruled that Plaintiff could not predicate its legal malpractice claim on allegations that Defendant filed a lien in the underlying case, but denied the motion in all other respects.  Now, Defendant demurs to each cause of action, arguing that there are insufficient facts to state causes of action.  The demurrer is overruled with respect to the first and second causes of action, and sustained with respect to the third cause of action.

LEGAL STANDARD

“It is black letter law that a demurrer tests the legal sufficiency of the allegations in a complaint.”  (Lewis v. Safeway, Inc. (2015) 235 Cal.App.4th 385, 388.)  In ruling on a demurrer, the court must “liberally construe[]” the allegations of the complaint.  (Code Civ. Proc., § 452.)  “This rule of liberal construction means that the reviewing court draws inferences favorable to the plaintiff, not the defendant.”  (Perez v. Golden Empire Transit Dist. (2012) 209 Cal.App.4th 1228, 1238.)

EVIDENTIARY ISSUES

            The Court denies Defendant’s request for judicial notice as moot.  The Court does not need to consider the attached pleadings in order to resolve the instant demurred. 

DISCUSSION

            In this case, Plaintiff alleges as follows: Plaintiff retained Defendant to handle the underlying case, which was Case Number BC609762.  (Complaint, ¶ 7.)  Plaintiff alleges that Defendant “negligently and carelessly breached the terms of the Retainer Letter and his fiduciary duty as an attorney to [Plaintiff] . . . .”  (Id., ¶ 8.)  Specifically, Defendant (1) “was not competent in the matter which he undertook and did not employ the care and skill of a reasonable attorney in prosecuting the case on behalf of [Plaintiff] . . . ;” (2) “failed to prosecute the matter reasonably and diligently . . . ;”  (3) “failed to keep [Plaintiff] reasonably informed of developments in the case . . . ;”  (4) “did not inform [Plaintiff] regarding discovery which was propounded, responses which were due, and Motions to Compel which were filed against [Plaintiff] . . . ;”  (5) “refused to follow the client’s direction with respect to litigation and settlement . . . ;”  (6) “charged [Plaintiff] for services which were unnecessary, not competently performed, and for which a reasonable attorney would have spent much less time and been more effective in the result . . . ;” (7) “dismissed and released parties who had liability and did not obtain his clients informed consent before doing so . . . ;”  (8) failed to properly prosecute discovery . . . or to affirmatively present [Plaintiff’s] case in response to discovery propounded on it . . . ;” and (9) “failed to take any depositions and failed to propound sufficient discovery to prosecute his client’s case . . . ;” “did not keep contemporaneous time records, employ reliable billing methods nor bill [Plaintiff] on any regular basis . . . .”  (Ibid.)  Plaintiff also alleges that Defendant “breached his fiduciary duty to D&M by failing to put D&M’s interests first, having a divided loyalty, failing to use reasonable care in the prosecution of the case, failing to obtain informed consent from his client prior to taking action in the case which materially affected the client’s rights, failing to charge his client only for services that were in fact rendered, additional breaches of fiduciary duty according to proof at the time of trial.”  (Ibid.)  “As a result of the foregoing acts of negligence and breach of contract, Plaintiff has been damages in the approximate amount of $350,000 and according to proof at the time of trial.”  (Id., ¶ 9.)  Specifically, Defendant sought to withdraw from the underlying case shortly before trial, which “cause[d] [Plaintiff’s] credibility to be diminished and its prospect at settlement with the opposing sides more difficult.”  (Id., ¶ 10.)  Plaintiff retained new counsel, and the case settled for less than Plaintiff felt was warranted.  (Ibid.) 

            It is not sufficient to allege simply that “the case was worth more than [the plaintiff] settled it for.”  (Marshak v. Ballesteros (1999) 72 Cal.App.4th 1514, 1519.)  Plaintiff must demonstrate that “but for the [attorney’s] negligence, [the] case would have settled for more or gone to trial and resulted in a larger recovery . . . .”  (Barnard v. Langer (2003) 109 Cal.App.4th 1453, 1462.)  The Court questions how Plaintiff will satisfy this standard.  Nevertheless, this is an issue for summary judgment or trial.  Plaintiff’s allegations are sufficient at this stage.  Plaintiff alleges that Defendant committed a series of negligent acts, e.g., dismissed and released parties who had liability without the client’s consents, failed to properly prosecute discovery, failed to take depositions, etc.  Plaintiff alleges that it was damaged as a result of these acts.  This is sufficient for pleading purposes.  Essentially, Defendant takes the position that had his alleged negligence resulted in a loss at trial, Plaintiff would have a viable cause of action, but the mere fact that Plaintiff settled beforehand means there is no malpractice cause of action.  This distinction is illogical. 

            The breach of contract claim is predicated upon largely the same facts and theories as the professional negligence claim.  Moreover, Plaintiff alleges that Defendant charged for unnecessary services and charged for excessive time spent on services.  This allegation is sufficient to support the cause of action for breach of contract, independently of the professional negligence allegations. 

             Based upon the foregoing, the Court overrules the demurrer to the first and second causes of action.  However, the Court sustains the demurrer to the third cause of action without leave to amend.  The Court has discretion to refuse to decide an issue of declaratory relief “in any case where its declaration or determination is not necessary or proper at the time under all the circumstances.”  (Code Civ. Proc., § 1061.)  Plaintiff’s first and second causes of action provide a sufficient forum to address the issues: 

            The declaratory relief statute should not be used for the purpose of anticipating and determining an issue which can be determined in the main action.  The object of the statute is to afford a new form of relief where needed and not to furnish a litigant with a second cause of action for the determination of identical issues.

(General of America Ins. Co. v. Lilly (1968) 258 Cal.App.2d 465, 470.)  Therefore, the Court sustains the demurrer to the third cause of action.

CONCLUSION AND ORDER

            Based upon the foregoing, the Court orders as follows:

            1.         The Court overrules the demurrer to the first and second causes of action.

            2.         The Court sustains the demurrer to the third cause of action without leave to amend.

            3.         Defendant shall file an answer within thirty (30) days.

            4.         Defendant’s counsel shall provide notice and file proof of such with the Court.