Chargin v. Maynard CA6 ( 2015 )

Filed 5/5/15 Chargin v. Maynard CA6
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SIXTH APPELLATE DISTRICT
THOMAS CHARGIN, H039499
(Santa Clara County
Plaintiff and Appellant, Super. Ct. No. 1-12-CV217640)
v.
DOUGLAS SCOTT MAYNARD et al.,
Defendants and Respondents.
In this appeal, we consider whether the trial court properly granted summary
judgment on a complaint for professional negligence based on the expiration of the
applicable statute of limitations set forth in Code of Civil Procedure section 340.6.1
Appellant Thomas Chargin was involved in litigation in his capacity as the successor
trustee of the Joseph A. Chargin III Revocable Living Trust (Trust) in which he was
represented by respondents Douglas Scott Maynard, Patrick Whitehorn, and the Law
Offices of Maynard & Hogan (hereafter collectively defendants). In January 2011, the
trial court issued an order adverse to Chargin and he blamed defendants for that result.
Chargin retained substitute counsel, executing a substitution of attorney form on January
25, 2011. The substitution of attorney form was transmitted to defendants on January 26,
2011, with a request that it be executed and returned, along with Chargin’s file, as soon
as possible. The fully-executed substitution form was filed with the court on February 2,
2011. Chargin’s complaint for professional negligence was filed on January 27, 2012.
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Further unspecified statutory references are to the Code of Civil Procedure.
The trial court granted defendants’ motion for summary judgment. In its order,
the trial court found Chargin was aware of the facts constituting defendants’ alleged
negligence no later than January 7, 2011 and that, although defendants’ continuing
representation of Chargin tolled the statute of limitations, their representation of him
ended no later than January 25 or 26, 2011 when Chargin transmitted to them an executed
substitution of attorney form.
On appeal, Chargin argues there was a triable issue of fact as to the date on which
defendants’ representation of him ended. Alternatively, he argues that defendants should
be equitably estopped from asserting the defense of the statute of limitations based on
their delay in executing the substitution of attorney form and returning his file to newly-
retained counsel.
We find no merit in either argument and shall affirm.
I. FACTUAL AND PROCEDURAL BACKGROUND
In 2005, Chargin was named successor trustee of the “Joseph A. Chargin III
Revocable Living Trust.” In 2009, Chargin retained Maynard to represent him in his
capacity as successor trustee of the Trust in litigation brought by Chargin’s siblings2
(hereafter the beneficiaries) relating to his management of the Trust.
At a December 23, 2010 hearing, the trial court sustained the beneficiaries
objections to Chargin’s petition for settlement of account of approval of trustee and
attorney fees. In its written order, filed January 5, 2011, the trial court surcharged
Chargin for (1) “$47,285.00 for attorney and ‘executor’ fees set forth in the account
which have already been paid and not substantiated”; (2) “$337.50 for . . . accountant
fees . . . for the ‘Trust Accounting’ ”; (3) “$23,734.82 for disbursements for which
[Chargin] has not provided adequate documentation in support thereof, and $275.32 for
2
Gregory C. Chargin and Joseph A. Chargin IV brought the action against
Chargin in their capacity as beneficiaries of the Trust.
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disbursements that [Chargin], individually, is responsible for paying”; and (4) a total of
$34,246.43 in attorney fees and costs related to the beneficiaries’ objections.
Following the entry of this order, Chargin met with Maynard on January 7, 2011
and again on January 21, 2011, to discuss the trial court’s order and to discuss the status
of the case. At the January 7 meeting, Chargin asked Maynard why certain documents
from Wells Fargo bank had not been provided to the court and why he was responsible
for paying the beneficiaries’ attorney fees. At the January 21 meeting, Chargin and
Maynard discussed the total amount of payments surcharged to Chargin and discussed
what steps should be taken in the case going forward. Maynard advised Chargin he
would try to work something out with the beneficiaries related to a plan to sell the house
in which Chargin was residing. That same day, Maynard sent Chargin the draft of a letter
he intended to send to the beneficiaries’ attorney discussing this plan.
On January 24, 2011, Chargin first met with Patrick Kohlmann to discuss his
willingness to substitute in as counsel in the ongoing trust litigation. Chargin and
Kohlmann signed a substitution of attorney form the following day, and Kohlmann sent,
by fax and mail, the substitution form to Maynard on January 26. In his cover letter,
Kohlmann asked that Maynard sign and return the form as soon as possible and indicated
he would send a courier to Maynard’s office that afternoon to pick up Chargin’s file.
Kohlmann called Maynard’s office that afternoon and was informed by a legal secretary
that Maynard and the other attorneys were not in the office that day. She advised
Kohlmann it would be several days before the file could be transferred. Kohlmann
believes he finally received the file between January 31 and February 2, 2011 because
that was the day he filed the fully-executed substitution of attorney form with the trial
court.
On January 27, 2012, Chargin filed a complaint against defendants in the Santa
Clara County Superior Court, setting forth a single cause of action for professional
negligence. The complaint alleges that defendants “failed to exercise reasonable care in
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the representation of . . . Chargin’s interests, as Successor Trustee, in the matter of In re
The Joseph A. Chargin III Revocable Living Trust, . . . in which numerous challenges
and objections were filed against . . . Chargin by the beneficiaries of the Trust.
Defendants . . . negligently failed to respond appropriately to the objections and failed to
seek an evidentiary hearing, thereby allowing the allegations against Chargin to go
uncontested. . . . [¶] As a direct and proximate result of the aforesaid negligence, Plaintiff
Chargin was assessed with a highly unfavorable order on January 5, 2011, by the Probate
Court. The Honorable Thomas Cain not only sustained the objections of the Objectors
and Beneficiaries, but also surcharged Plaintiff and assessed attorneys [sic] fees against
him resulting in damages of at least $184,668.42. [¶] Defendants represented Plaintiff
until February 2, 2011, which tolled the statute of limitations until said date.”
Defendants moved for summary judgment on the ground that the applicable one-
year statute of limitations began to run no later than January 25, 2011, when Chargin
executed the substitution of attorney form with Kohlmann and thus had expired when the
complaint was filed on January 27, 2012. In his opposition, Chargin argued there was a
triable issue of fact as to when the statute of limitations began to run since Maynard
failed to promptly execute and return the substitution of attorney form to Kohlmann
along with his client file.
Following a hearing, the trial court granted the motion and entered judgment in
favor of defendants. In its order granting summary judgment, the trial court found that
defendants’ representation of Chargin ended no later than January 25 or 26, 2011 and
thus the complaint filed on January 27, 2012, was untimely.
II. DISCUSSION
Chargin argues the trial court erred in granting summary judgment because he
presented evidence in opposition to the motion which established triable issues of
material fact. He disputes he directed defendants to stop working on his case pending
further instruction. Although Chargin retained Kohlmann as his counsel on January 25,
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he intended to have defendants continue to represent him until the substitution of attorney
form was executed and returned along with his file.
A. Summary judgment principles and standard of review on appeal
A summary judgment “shall be granted if all the papers submitted show that there
is no triable issue as to any material fact and that the moving party is entitled to a
judgment as a matter of law.” (§ 437c, subd. (c).) A defendant seeking summary
judgment meets his burden by showing that an element of the plaintiff’s cause of action
cannot be established or that a complete defense to the cause of action exists and cannot
be successfully contested by the plaintiff. “Once the defendant . . . has met that burden,
the burden shifts to the plaintiff . . . to show that a triable issue of one or more material
facts exists as to that cause of action or . . . defense . . . .” (Id., subd. (p)(2).) “In
determining whether the papers show that there is no triable issue as to any material fact
the court shall consider all of the evidence set forth in the papers, except that to which
objections have been made and sustained by the court . . . .” (Id., subd. (c).)
On appeal from a summary judgment, our task is to independently determine
whether an issue of material fact exists and whether the moving party was entitled to
summary judgment as a matter of law. (Brantley v. Pisaro (1996) 42 Cal. App. 4th 1591,
1601.) “We independently review the parties’ papers supporting and opposing the
motion, using the same method of analysis as the trial court. Essentially, we assume the
role of the trial court and apply the same rules and standards.” (Kline v. Turner (2001) 87
Cal. App. 4th 1369, 1373.) We apply the same three-step analysis required of the trial
court. First, we identify the issues framed by the operative complaint and answer since it
is these allegations to which the motion must respond. Second, we determine whether the
moving party’s showing establishes facts which negate the opponent’s claim and justifies
a judgment in the moving party’s favor. When the moving party makes a prima facie
showing, the third and final step is to determine whether the opposition demonstrates the
existence of a triable issue of material fact. (Hamburg v. Wal-Mart Stores, Inc. (2004)
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116 Cal. App. 4th 497, 503.) In performing these steps, we view the evidence in the light
most favorable to the party opposing the motion; and we liberally construe the opposing
party’s evidence, strictly construe the moving party’s evidence, and resolve all doubts in
favor of the opposing party. (Johnson v. American Standard, Inc. (2008) 43 Cal. 4th 56,
64.)
B. Applicable statute of limitations and tolling
“The applicable statute of limitations for legal malpractice claims is [Code of Civil
Procedure] section 340.6.” (Truong v. Glasser (2009) 181 Cal. App. 4th 102, 110.)
Section 340.6 provides in pertinent part that “[a]n action against an attorney for a
wrongful act or omission, other than for actual fraud, arising in the performance of
professional services shall be commenced within one year after the plaintiff discovers, or
through the use of reasonable diligence should have discovered, the facts constituting the
wrongful act or omission, or four years from the date of the wrongful act or omission,
whichever occurs first. . . . [I]n no event shall the time for commencement of legal action
exceed four years except that the period shall be tolled during the time that any of the
following exist: [¶] . . . [¶] (2) The attorney continues to represent the plaintiff regarding
the specific subject matter in which the alleged wrongful act or omission occurred.” (§
340.6, subd. (a)(2).)
“Under California law, the statute of limitations for attorney malpractice claims
arising from a given matter is tolled for the duration of the attorney’s representation of
the client in that matter. (Code Civ. Proc., § 340.6, subd. (a)(2).)” (Beal Bank, SSB v.
Arter & Hadden, LLP (2007) 42 Cal. 4th 503, 505.) “The purpose of this ‘continuous
representation’ rule, the Supreme Court observed in Laird v. Blacker (1992) 2 Cal. 4th
606, is to ‘ “avoid the disruption of an attorney-client relationship by a lawsuit while
enabling the attorney to correct or minimize an apparent error, and to prevent an attorney
from defeating a malpractice cause of action by continuing to represent the client until the
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statutory period has expired.” ’ ” (Worthington v. Rusconi (1994) 29 Cal. App. 4th 1488,
1495 (Worthington).)
Section 340.6 does not expressly define continuous representation. In
Worthington, supra, 29 Cal.App.4th at page 1497, this court determined that “
‘[o]rdinarily, an attorney’s representation is not completed until the agreed tasks or
events have occurred, the client consents to termination or a court grants an application
by counsel for withdrawal.’ [Citation.] ‘The rule is that, for purposes of the statute of
limitations, the attorney’s representation is concluded when the parties so agree, and that
result does not depend upon formal termination, such as withdrawing as counsel of
record.’ ” We further held that the standard for determining when an attorney’s
representation has ended is an objective standard. (Ibid.) “Continuity of representation
ultimately depends, not on the client’s subjective beliefs, but rather on evidence of an
ongoing mutual relationship and of activities in furtherance of the relationship.” (Id. at p.
1498.)
Where the attorney unilaterally withdraws or abandons the client, “the
representation ends when the client actually has or reasonably should have no
expectation that the attorney will provide further legal services.” (Gonzalez v. Kalu
(2006) 140 Cal. App. 4th 21, 30 (Gonzalez), italics added.) “That may occur upon the
attorney’s express notification to the client . . . , or, if the attorney remains silent, may be
inferred from the circumstances.” (Id. at pp. 30-31.) “After a client has no reasonable
expectation that the attorney will provide further legal services . . . the client is no longer
hindered by a potential disruption of the attorney-client relationship and no longer relies
on the attorney’s continuing representation, so the tolling should end.” (Id. at p. 31.)
C. Analysis
Here, defendants had the initial burden of establishing that Chargin filed his
complaint more than a year after he discovered or should have discovered the facts
constituting the alleged wrongful conduct. (§§ 340.6, subd. (a)(2), 437c, subd. (p)(1).)
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After independently reviewing the evidence, we conclude that defendants satisfied that
burden.
Chargin’s cause of action for professional negligence was premised on his
allegations that defendants “failed to exercise reasonable care in the representation of . . .
Chargin’s interests, as Successor Trustee, in the matter of In re The Joseph A. Chargin III
Revocable Living Trust, . . . in which numerous challenges and objections were filed
against . . . Chargin by the beneficiaries of the Trust. Defendants . . . negligently failed to
respond appropriately to the objections and failed to seek an evidentiary hearing, thereby
allowing the allegations against Chargin to go uncontested.”
Defendants presented evidence that Chargin was aware of the facts underlying
these allegations no later than January 7, 2011, when Chargin met with Maynard at
defendants’ office to discuss the adverse order. That evidence included Maynard’s
declaration, Chargin’s deposition testimony and his own declaration in which he
described discussing, at that January 7 meeting, his “displeasure regarding . . . the order
requiring [him] to pay attorney’s [sic] fees, . . . [why] certain evidence had not been
submitted . . . , and [why] [he] had to prepare an accounting that was ‘to date,’ rather than
just to the timeframe . . . specified at the hearing.” Defendants thus made a prima facie
showing that Chargin knew by January 7, 2011, that defendants were negligent in their
representation of him.
Defendants also made a prima facie showing that, although they continued to
represent Chargin after that January 7 meeting, their continued representation of him
ended no later than January 26, 2011. Chargin conceded he retained Kohlmann to
represent him in the ongoing litigation relating to the Trust on January 25, 2011 and he
and Kohlmann executed the substitution of attorney form on that date. In his deposition,
Chargin admitted that when he signed the substitution of attorney form, he “had no
intention of going back to [defendants] for any further representation in the trust matter”
and acknowledged that he was “essentially firing [defendants] at [that] point.” At a
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minimum, defendants’ representation of Chargin was at an end when the substitution
form, signed by Chargin and Kohlmann, was transmitted to them on January 26, 2011,
with the request that it be signed and returned as soon as possible. Chargin could have
“no reasonable expectation that [defendants] [would] provide further legal services” after
that. (Gonzalez, supra, 140 Cal.App.4th at p. 31.)
Even if Chargin subjectively believed that defendants continued to represent him
until they returned the substitution of attorney form and his file, it is well-established that
“[c]ontinuity of representation ultimately depends, not on the client’s subjective beliefs,
but rather on evidence of an ongoing mutual relationship and of activities in furtherance
of the relationship.” (Worthington, supra, 29 Cal.App.4th at p. 1498.) Chargin’s
deposition testimony and his declaration submitted in opposition to defendants’ motion
for summary judgment established that there was no evidence of “an ongoing mutual
relationship” or of “activities in furtherance of the relationship” after he executed the
substitution of attorney form and caused it to be transmitted to defendants. (Ibid.)
Defendants presented evidence that Chargin did not file his lawsuit against them
until January 27, 2012, more than a year after he was aware of the facts underlying his
cause of action and more than a year following the end of the tolling period attributable to
their continuing representation of him. The prima facie showing that the cause of action
was barred by the one-year statute of limitations set forth in section 340.6 shifted the
burden to Chargin to raise a triable issue of material fact. (Aguilar v. Atlantic Richfield
Co. (2001) 25 Cal. 4th 826, 850.)
The only evidence submitted by Chargin regarding the end of the tolling period
consists of the fact that the substitution form and his client file was not returned by
defendants until, at the latest, February 2, 2011. However, this evidence is not sufficient
to create a triable issue of fact as to when defendants’ representation of him ended. Once
Chargin executed the substitution form and caused it to be transmitted to defendants,
informing them that he had fired them and retained new counsel, Chargin either had or
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reasonably should have had no expectation that defendants would provide further legal
services to him. “After a client has no reasonable expectation that the attorney will
provide further legal services, however, the client is no longer hindered by a potential
disruption of the attorney-client relationship and no longer relies on the attorney’s
continuing representation, so the tolling should end.” (Gonzalez, supra, 140 Cal.App.4th
at p. 31.) Moreover, there is no evidence after January 26, 2011, of “an ongoing mutual
relationship and of activities in furtherance of the relationship.” (Worthington, supra, 29
Cal.App.4th at p. 1498.)
In sum, Chargin’s admissions establish that the representation ended no later than
January 26, 2011. He did not file his lawsuit until January 27, 2012. Because he failed to
raise a triable issue of material fact about whether the statute of limitations was tolled
beyond January 26, 2011, the trial court properly granted summary judgment in favor of
defendants.
D. Equitable estoppels
In his opening brief, Chargin argues in the alternative that the judgment against
him must be reversed on the ground that defendants should be equitably estopped from
asserting that the tolling period ended on or before January 26, 2011, since it was their
delay in returning the substitution of attorney form and his file that prevented his new
attorney from representing him until the beginning of February. He admits he did not
raise this theory in his opposition to defendants’ summary judgment motion, either in his
papers or at the hearing on the motion.
Defendants failed to address this argument in their respondents’ brief and, in his
reply, Chargin pounces on that omission as a concession of the argument’s merit. We
disagree.
As a general rule, theories not raised in the trial court cannot be asserted for the
first time on appeal. Appealing parties must adhere to the theory or theories on which
their cases were tried. (Ernst v. Searle (1933) 218 Cal. 233, 240-241; Brown v. Boren
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(1999) 74 Cal. App. 4th 1303, 1316.) This rule is based on the notion that it would be
unfair to both the trial court and the opposing litigants to permit a change of theory on
appeal. (Brown v. Boren, supra, at p. 1316.) The appellate court may deviate from the
general rule and address new theories on appeal “when the issue presented involves
purely a legal question, on an uncontroverted record and requires no factual
determinations . . . .” (Mattco Forge, Inc. v. Arthur Young & Co. (1997) 52 Cal. App. 4th
820, 847.) The appellate court is not required to apply this exception and consider a new
theory based on a pure question of law. Whether to do so is within the appellate court’s
discretion. (Resolution Trust Corp. v. Winslow (1992) 9 Cal. App. 4th 1799, 1810.)
Defendants’ failure to address Chargin’s estoppel argument in their respondents’
brief cannot deprive this court of its discretion to consider or reject the claim ab initio.
The facts supporting Chargin’s equitable estoppel defense were known to him at the time
he opposed defendants’ summary judgment motion, and he offers no justification for
failing to raise it before the trial court. We will not excuse that failure by considering the
argument for the first time here.
III. DISPOSITION
The judgment is affirmed. Defendants are entitled to their costs on appeal.
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Premo, J.
WE CONCUR:
Rushing, P.J.
Elia, J.