Michael Smith v. Jordan Ramis ( 2016 )

FILED
NOT FOR PUBLICATION MAR 30 2016
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
MICHAEL L. SMITH, No. 14-55391
Plaintiff - Appellant, D.C. No. 3:12-cv-02025-W-RBB
v.
MEMORANDUM*
JORDAN RAMIS, PC; et al.,
Defendants - Appellees.
Appeal from the United States District Court
for the Southern District of California
Thomas J. Whelan, Senior District Judge, Presiding
Submitted February 5, 2016**
Pasadena, California
Before: PREGERSON, WARDLAW, and HURWITZ, Circuit Judges.
Michael Smith appeals the district court’s grant of summary judgment in
favor of Jordan Ramis, P.C. and Douglas Cushing for claims of legal malpractice,
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
fraud, and misrepresentation. We have jurisdiction pursuant to 28 U.S.C. § 1291,
and we affirm.
Smith’s legal malpractice claims are barred by the statute of limitations.
Based on the record, Smith discovered “the facts constituting the wrongful act” in
2010. Cal. Civ. Proc. Code § 340.6(a). Smith discussed his legal malpractice
claim multiple times with his new lawyer as early as April or May 2010. And
Smith no doubt had discovered the alleged legal malpractice by August 2010 when
he emailed Cushing to complain about “how vague and badly the [Domestic
Partnership Agreement (DPA)] was written.” Because Smith did not file his suit
until June 2012, his legal malpractice claims are barred by the statute of
limitations.
The one-year statute of limitations is not tolled under the “actual injury”
exception. See Cal. Civ. Proc. Code § 340.6(a)(1). Smith sustained actual injury
in December 2010, when his domestic partner mounted an “objectively viable
defense,” Jordache Enters., Inc. v. Brobeck, Phleger & Harrison, 958 P.2d 1062,
1065 (Cal. 1998), and February 2011, when his domestic partner formally moved
to invalidate the DPA. Both events increased Smith’s costs to litigate and reduced
the settlement value, and both occurred over a year before the filing of this suit.
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The one-year statute of limitations is also not tolled by the continuity of
representation exception. See Cal. Civ. Proc. Code § 340.6(a)(2). The “mutual
relationship” between Smith and Jordan Ramis ended with Smith’s August 20,
2010 email in which he expressed extreme dissatisfaction and refused to pay. See
Worthington v. Rusconi, 35 Cal. Rptr. 2d 169, 174 (Ct. App. 1994). That Smith
did not expressly terminate Cushing as his attorney is not dispositive. See Shapero
v. Fliegel, 236 Cal. Rptr. 696, 699–700 (Ct. App. 1987). The April 2011 telephone
calls do not establish a continuous relationship because these calls were not in
furtherance of the attorney-client relationship. See Foxborough v. Van Atta, 31
Cal. Rptr. 2d 525, 528–29 (Ct. App. 1994).
Smith’s remaining claims of fraud and deceit, fraudulent concealment, and
negligent misrepresentation lack merit.
Under California law, negligent misrepresentation is “a species of the tort of
deceit,” and shares the same elements. B.L.M. v. Sabo & Deitsch, 64 Cal. Rptr. 2d
335, 347 (Ct. App. 1997). The elements of fraud and deceit are: “(1) a
misrepresentation of a past or existing material fact, (2) without reasonable
grounds for believing it to be true, (3) with intent to induce another’s reliance on
the fact misrepresented, (4) ignorance of the truth and justifiable reliance thereon
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by the party to whom the misrepresentation was directed, and (5) damages.” Id. at
342 (quoting Fox v. Pollack, 226 Cal. Rptr. 532, 537 (Ct. App. 1986)).
The undisputed facts establish that Cushing did not make any
misrepresentations to Smith when he agreed to draft the DPA. Cushing told Smith
that Cushing could do the work, that he had access to California law, and that
Jordan Ramis had an attorney who was licensed to practice in California. Smith
failed to prove that any of these statements were untrue. Additionally, because
Cushing had previously prepared premarital agreements and one domestic
partnership agreement in Oregon, he had “reasonable grounds for believing [these
statements] to be true.” Id. There is no evidence that Cushing intentionally
induced Smith into relying on any alleged misrepresentations, or that Smith relied
to his detriment on such misrepresentations. Thus, Smith is unable to prove the
first four elements of fraud, deceit, and negligent misrepresentation.
To prove fraudulent concealment, Smith must similarly show that: “(1) the
defendant . . . concealed or suppressed a material fact, (2) the defendant [was]
under a duty to disclose the fact to the plaintiff, (3) the defendant . . . intentionally
concealed or suppressed the fact with the intent to defraud the plaintiff, (4) the
plaintiff [was] unaware of the fact and would not have acted as he did if he had
known of the concealed or suppressed fact, and (5) as a result of the concealment
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or suppression of the fact, the plaintiff must have sustained damage.”
Prakashpalan v. Engstrom, Lipscomb & Lack, 167 Cal. Rptr. 3d 832, 853 (Ct.
App. 2014) (quoting Mkt. W., Inc. v. Sanyo Fisher (USA) Corp., 7 Cal. Rptr. 2d
859, 864 (Ct. App. 1992).
The record does not support the third element of fraudulent concealment:
intent to defraud. The evidence does not establish that Cushing intentionally
concealed the qualifications of the California-licensed attorney with the intent to
defraud Smith. In fact, Smith admitted that his decision to hire Cushing and
Jordan Ramis stemmed from Cushing’s previous work handling Smith’s will and
LLC, and because Cushing was Smith’s uncle. Smith himself stated that there
“wasn’t any more thought than that.”
AFFIRMED.
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