Schulz v. Jeppesen Sanderson, Inc. ( 2018 )


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  • Filed 9/5/18; Certified for publication 10/2/18 (order attached)
    IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
    SECOND APPELLATE DISTRICT
    DIVISION ONE
    NICOLAS SCHULZ, a Minor, etc.,                             B277493
    et al.,
    (Los Angeles County
    Plaintiffs and Respondents,
    Super. Ct. No. BC 537157)
    v.
    JEPPESEN SANDERSON, INC.,
    et al.,
    Defendants;
    HERZOG, YUHAS, EHRLICH
    & ARDELL, APC,
    Appellant.
    APPEAL from an order of the Superior Court of Los Angeles
    County, William F. Fahey, Judge. Reversed.
    Herzog, Yuhas, Ehrlich & Ardell, Ian Herzog, Thomas F.
    Yuhas, and Evan D. Marshall for Appellant Herzog, Yuhas, Ehrlich
    & Ardell, APC.
    Nelson & Franekel and Gretchen M. Nelson for Amicus
    Curiae Consumer Attorneys of California on behalf of Appellant
    Herzog, Yuhas, Ehrlich & Ardell, APC.
    Kiesel Law and Paul R. Kiesel for Amici Curiae Kiesel Law
    and Paul R. Kiesel on behalf of Appellant Herzog, Yuhas, Ehrlich &
    Ardell, APC.
    Buchalter, Harry W.R. Chamberlain II; Glickman &
    Glickman and Steven C. Glickman for Plaintiffs and Respondents
    Nicolas Schulz, Tristan Schulz, Florian Schulz, and Lukas Schulz,
    Minors, by Silke Schulz, their guardian ad litem.
    _______________
    This case arises out of a wrongful death lawsuit, in
    which appellant Herzog, Yuhas, Ehrlich & Ardell, APC (Herzog)
    represented plaintiffs and respondents Silke Schulz and her
    four young children.1 Silke’s husband Rainer died when the
    plane he was piloting crashed just before landing at an airport in
    Germany. Herzog obtained a settlement of $18,125,000 from the
    manufacturers of the aircraft and from the providers of some of
    the aircraft’s systems, maps, and charts, all of whose negligence
    allegedly contributed to the crash. After a trial to determine the
    allocation of the settlement funds among Silke, her four young
    children with Rainer, Rainer’s two adult daughters from a previous
    marriage, and Asia Today, the trial court allocated virtually all
    the settlement proceeds to the minor children. The court awarded
    Herzog 10 percent of the children’s funds as attorney fees, rather
    than the 40 percent called for in the contingency fee agreement or
    the 31 percent requested by Herzog. Herzog contends that the trial
    1  Herzog also represented Rainer Schulz’s company,
    Asia Today, which claimed indemnity based on its settlement
    with the estate of Rainer’s co-pilot, who also died in the crash.
    The primary plaintiff in the case, Steven Spector, was appointed
    to act as administrator of Rainer’s estate. Spector is not a party
    to this appeal. Throughout this opinion, we refer to Rainer and
    Silke Schulz by their first names in order to distinguish them.
    No disrespect is intended.
    2
    court abused its discretion by reducing its fee to 10 percent.
    We agree and reverse.
    FACTS AND PROCEEDINGS BELOW
    At the time of his death, Rainer was the president and
    co-owner with Silke of Asia Today. Silke had previously worked
    alongside Rainer at Asia Today, but she left the business in 2010
    when her first son Lukas was born. In 2011, the family expanded
    to add triplets. The triplets were born prematurely, and two
    suffered serious, permanent disabilities. At the time of his death,
    Rainer was primarily responsible for the financial support of Silke
    and the four children. Rainer also had two adult daughters from a
    prior marriage, both of whom had been receiving financial support
    from him at the time of his death.
    On March 1, 2012, Rainer was piloting a small Cessna
    jet aircraft owned by Asia Today with a co-pilot and three other
    passengers onboard on their way to Egelsbach airport near
    Frankfurt, Germany. As the plane began its final approach, it
    struck a grove of trees on a hilltop approximately two miles from
    the runway, crashing and killing everyone on board.
    Before hiring Herzog, Silke consulted with aviation experts
    to determine the cause of the crash. Two experts consulted the
    preliminary report from the BFU, the German government agency
    responsible for investigating air accidents, and concluded that pilot
    error was the primary cause of the crash.2 The experts concluded
    that Rainer disregarded standardized operating procedures and
    failed to fly a stabilized approach, with the result that the plane
    2  The BFU report itself did not reach a conclusion regarding
    the cause of the crash. The record includes one expert report, but
    it does not specify whether the report came from Silke’s experts
    or from those hired by the estate of the aircraft’s co-pilot, whose
    representatives sued Asia Today and ultimately settled their claims
    in a separate case.
    3
    flew too fast too close to the airport, and when difficulty arose, he
    and his co-pilot did not have the situational awareness or time to
    recover. Attorneys for the estate of Rainer’s co-pilot also attributed
    insufficient visibility as another potential cause of the crash.
    The Egelsbach airport lacks the technology to allow pilots to land
    relying solely on instruments, meaning that they must maintain
    visual contact with the runway in order to land. At the time of the
    accident, cloud cover may have been as low as 400 to 800 feet.
    Herzog agreed to represent Silke, her sons, and Asia Today
    on a contingency basis. Herzog hypothesized that the Cessna’s
    enhanced ground proximity warning system was not functioning
    properly, and that as a result, a “[p]ull-up” warning sounded only
    two seconds before impact. Herzog believed that if the warning
    system had been functioning properly, it would have begun
    sounding alarms 14 seconds before impact, which would have
    allowed enough time for Rainer to avoid crashing. Herzog also
    suspected that the aviation charts on which Rainer relied, which
    did not fully describe the hills nor chart the crash site elevation,
    may have contributed to the crash.
    Silke, together with Klaus Hoffman, the chief executive officer
    of Asia Today, negotiated the terms of Herzog’s representation, with
    the participation of Asia Today’s corporate attorneys. According
    to Herzog, Silke and Hoffman considered several attorneys to
    represent them in the case; they had the resources to pay for legal
    representation on an hourly basis, but chose a contingency
    arrangement because of, among other reasons, the risk that
    the plaintiffs might not be able to recover enough to warrant the
    expense of hourly fees. According to Herzog, the other attorneys
    Silke spoke with would not take the case on a contingency basis. In
    addition to the causation risk, Silke was aware that the defendants
    might attempt to remove the case to Germany. Rainer and Silke
    were German nationals, the chart manufacturer was a German
    entity, and the accident had occurred in Germany. According to
    4
    Herzog, removal to Germany would likely reduce the potential
    value of the case to the plaintiffs, as damages awards in Germany
    are typically smaller than in United States courts. Respondents
    do not challenge this assertion.
    The fee agreement that Herzog negotiated with Hoffman
    and Silke called for Herzog to receive 31 percent of any settlement
    funds if the case settled at least 30 days before trial, and 40 percent
    if it settled later. In discovery, plaintiffs learned that the chart
    manufacturer had surveyed the area where the crash took place
    a few months before the accident, but had not revised its charts
    until after the crash. Herzog also discovered that the manufacturer
    of the plane’s guidance software had released a software update
    shortly after the sale of the aircraft, but the update was never
    installed on Asia Today’s plane. The Cessna service bulletin listed
    the software update as “[o]ptional” rather than “[r]ecommended
    or “[m]andatory,” and did not describe the safety enhancements in
    the update. Herzog’s experts claimed that, if the update had been
    installed, the guidance system would have issued visual and audio
    warnings 16 seconds before the crash, allowing Rainer time to abort
    the landing. Flight records indicated that the guidance system did
    not issue any such warnings until two seconds before the crash.
    After approximately 18 months of litigation, and a few days
    before trial was scheduled to begin, the parties agreed to settle
    the case for an unallocated $18,125,000.
    In the case of any wrongful death award, including one
    obtained through settlement, the trial court must apportion
    the award among the claimants. (Code of Civ. Proc., § 377.61;
    Corder v. Corder (2007) 
    41 Cal. 4th 644
    , 653-654.) In any case
    in which settlement proceeds are paid to a minor, the court must
    approve the attorney fees paid out of the minor’s share. (See
    Prob. Code, §§ 3600-3601.)
    5
    Herzog proposed that the court allocate 65 percent of the
    proceeds, or $11,781,250, to Silke and Asia Today,3 and divide
    the remaining 35 percent, or $6,343,750, equally among the four
    children. Herzog requested 31 percent of the amount allocated to
    the children as attorney fees, and informed the court that it would
    collect attorney fees from Silke of approximately 30 percent of
    the amount allocated to her. Herzog proposed that Rainer’s two
    adult children from a prior marriage receive no money. Silke had
    previously purchased their interests in Rainer’s estate, and she
    incorrectly believed this included their right to recover from the
    wrongful death lawsuit.
    The daughters did not know about the wrongful death suit
    until the case was well underway. They did not contest the
    settlement, but did disagree with their exclusion from the allocation
    of the proceeds. Silke reached a settlement with the daughters for
    their claims, which the court accepted.
    The court ultimately rejected Herzog’s proposed allocation
    and, in April 2016, issued a statement of decision apportioning
    all of the settlement proceeds to the four children, less one dollar,
    which the court allocated to Silke. The court rejected Herzog’s
    claim for 31 percent of the children’s share of the settlement and
    instead awarded Herzog 10 percent. The court acknowledged
    that Herzog had done “a good job in investigating [the] case” and
    realized “a substantial sum.” On the other hand, the court noted
    that “the case did not have to be tried” and faulted Herzog for
    failing to notify the adult daughters of the case earlier. The court
    concluded that this “was either negligent or a highly questionable
    tactical decision, which caused much unnecessary litigation and
    delays.”
    3 The proposed settlement does not specify the percentage to
    be paid to Asia Today, as opposed to Silke.
    6
    After the trial court issued its statement of decision,
    Herzog withdrew from representation of Silke and her children
    due to the conflict of interest regarding the fee. Herzog moved
    for a new trial on the issue of attorney fees, alleging that the court
    had not made adequate findings to support the reduction in its
    attorney’s fees. Silke and the children opposed the motion, arguing
    that Herzog had forfeited this argument by failing to object to the
    statement of decision. The trial court denied the motion.
    DISCUSSION
    Herzog contends that the trial court abused its discretion
    when it awarded attorney fees of only 10 percent of the total value
    of the settlement and asks that we order the trial court to award it
    31 percent of the children’s portion, rather than remanding the case
    to the trial court to reconsider its ruling. We agree that the trial
    court abused its discretion but we decline to determine in the first
    instance what fee would be appropriate under California Rules of
    Court, rule 7.955. Rather, that is a matter in the first instance for
    the trial court to exercise its discretion.
    I.    Background on Approving a Settlement
    Involving Minors
    In any case in which a trial court approves a settlement
    involving the payment of funds to a minor, the court must
    make an order for the payment of reasonable attorney fees.
    (See Prob. Code, §§ 3600-3601.) Rule 7.955 of the California Rules
    of Court establishes the procedure the court must follow and factors
    it may consider in determining whether an attorney’s proposed
    fee is reasonable. We review the trial court’s decision regarding
    attorney fees for abuse of discretion. (Thayer v. Wells Fargo Bank
    (2001) 
    92 Cal. App. 4th 819
    , 832-833.) This is a deferential standard
    of review, but “reversal is required where there is no reasonable
    basis for the ruling or when the trial court has applied the wrong
    7
    test to determine if the statutory requirements were satisfied.”
    (Flannery v. California Highway Patrol (1998) 
    61 Cal. App. 4th 629
    , 634.)
    California Rules of Court, rule 7.955(a) provides that, in
    the absence of a fee agreement previously approved by the court,
    “the court must use a reasonable fee standard when approving
    and allowing the amount of attorney’s fees payable from money or
    property paid or to be paid for the benefit of a minor.” (Cal. Rules
    of Court, rule 7.955(a)(1).) In determining whether a proposed fee
    is reasonable, “[t]he court must give consideration to the terms of
    any representation agreement made between the attorney and the
    representative of the minor . . . and must evaluate the agreement
    based on the facts and circumstances existing at the time the
    agreement was made.” (Cal. Rules of Court, rule 7.955(a)(2).)
    Rule 7.955(b) of the California Rules of Court also
    provides a “nonexclusive” list of factors the court may consider in
    determining a reasonable attorney’s fee. The first of these factors
    is “[t]he fact that a minor . . . is involved and the circumstances of
    that minor.” (Cal. Rules of Court, rule 7.955(b)(1).) The remaining
    factors pertain mostly to the nature of the legal work involved.
    Thus, a court may consider “[t]he amount of the fee in proportion
    to the value of the services performed” (Cal. Rules of Court,
    rule 7.955(b)(2)), “[t]he novelty and difficulty of the questions
    involved and the skill required to perform the legal services
    properly” (Cal. Rules of Court, rule 7.955(b)(3)), and “[t]he
    amount involved and the results obtained” (Cal. Rules of Court,
    rule 7.955(b)(4)). Other factors pertain to other aspects of the
    representation, including “[t]he time limitations or constraints
    imposed by the representative of the minor . . . or by the
    circumstances” (Cal. Rules of Court, rule 7.955(b)(5)); “[t]he
    nature and length of the professional relationship between the
    attorney and the representative of the minor” (Cal. Rules of Court,
    rule 7.955(b)(6)); “[t]he experience, reputation, and ability of the
    8
    attorney or attorneys performing the legal services” (Cal. Rules
    of Court, rule 7.955(b)(7)); and “[t]he time and labor required”
    (Cal. Rules of Court, rule 7.955(b)(8)). In addition, the court may
    consider factors relating to the minor’s representative, including
    “[t]he informed consent of the representative of the minor”
    (Cal. Rules of Court, rule 7.955(b)(9)); “[t]he relative sophistication
    of the attorney and the representative of the minor” (Cal. Rules
    of Court, rule 7.955(b)(10)); and “[t]he likelihood, if apparent
    to the representative of the minor . . . when the representation
    agreement was made, that the attorney’s acceptance of the
    particular employment would preclude other employment” (Cal.
    Rules of Court, rule 7.955(b)(11)). The court may also consider
    “[w]hether the fee is fixed, hourly, or contingent” (Cal. Rules of
    Court, rule 7.955(b)(12)) and, if contingent, the court may consider
    “(A) [t]he risk of loss borne by the attorney; [¶] (B) [t]he amount
    of costs advanced by the attorney; and [¶] (C) [t]he delay in
    payment of fees and reimbursement of costs paid by the attorney”
    (Cal. Rules of Court, rule 7.955(b)(13)(A)-(C)). Finally, the court
    may consider “[s]tatutory requirements for representation
    agreements applicable to particular cases or claims.” (Cal. Rules
    of Court, rule 7.955(b)(14).)
    II.   Application to this Case
    California Rules of Court, rule 7.955 does not dictate a
    presumptively reasonable percentage or mathematical method
    of determining the appropriate attorney fees under a contingency
    agreement. Indeed, in adopting the rule, the Judicial Council
    explicitly preempted local rules regarding attorney fees for minors,
    many of which had established a baseline recovery of 25 percent.4
    4  Even if there is no benchmark starting point for attorney
    fees in cases under California Rules of Court, rule 7.955, a court
    may of course reasonably determine that 25 percent is an
    appropriate percentage in a given case.
    9
    The parties do not provide any argument to suggest that any
    particular percentage is appropriate for all cases. We acknowledge
    that what is reasonable in applying the factors in California Rules
    of Court, rule 7.955 in any particular case may comprise a range of
    percentages. Under the facts of this case, however, 10 percent was
    not within that reasonable range. Although the trial court would
    be acting within its discretion to award less than 31 percent, we
    note that 31 percent is not out of line with awards in class actions,
    which, like this case, involve attorney fees to be paid by a protected
    class and that require court approval.
    Thus, our Supreme Court has upheld a decision to approve
    a class action settlement providing that plaintiff receive one-third
    of a $19 million settlement. (See Laffitte v. Robert Half Internat.
    Inc. (2016) 1 Cal.5th 480, 485-486.) The Ninth Circuit deems
    25 percent of the total recovery pool its standard starting point
    for attorney fees in class-action settlements. (See In re Bluetooth
    Headset Products Liability) (9th Cir. 2011) 
    654 F.3d 935
    , 942.)
    Some California courts have also found this guideline reasonable
    in class actions. (See, e.g., Consumer Privacy Cases (2009)
    
    175 Cal. App. 4th 545
    , 557, fn. 13; Lealao v. Beneficial California,
    Inc. (2000) 
    82 Cal. App. 4th 19
    , 24, fn. 1.)
    Here the trial court’s full statement on the matter is as
    follows: “Turning to the issue of attorney’s fees, the Court is
    not bound by a contingency agreement when considering the best
    interests of the minors. Attorney fees must be carefully scrutinized
    and adjusted if warranted. Here, the attorneys hired by Silke did
    a good job in investigating this case. And, with the tremendous
    assistance of a settlement judge, a substantial sum was realized.
    On the other hand, the case did not have to be tried. Moreover,
    the attorneys’ failure to notify [the adult daughters] of their claims
    until the eve of trial—some 18 months after the case was filed—
    was either negligent or a highly questionable tactical decision,
    which caused much unnecessary litigation and delays. The Court
    10
    concludes that a 10% award of contingency fees is fair and proper.”
    The court went on to suggest that Silke was free to pay Herzog
    “whatever sum she feels is reasonable. But paying these attorneys
    their requested $5 million in fees out of the settlement proceeds
    would be excessive, to the substantial detriment of Rainer’s sons
    and contrary to this Court’s duty [to] assure that no injustice is
    done to them.”
    We conclude the trial court gave too little consideration to
    California Rules of Court, rule 7.955(a)(2), which required it to
    take into account the terms of Herzog’s representation agreement
    with Silke from the perspective of when the agreement was signed.
    In addition, the court did not acknowledge the factors listed in
    California Rules of Court, rule 7.955(b). Although these factors are
    not mandatory, they provide a guide to the considerations relevant
    to determining whether a fee protects the interests of a minor while
    allowing an attorney to obtain a fair recovery. Instead of balancing
    the relevant factors, the court gave overwhelming weight to a single
    concern, the expense of the children’s extensive medical needs.
    California Rules of Court, rule 7.955 requires a trial court,
    in determining reasonable attorney fees, to balance an attorney’s
    interest in fair compensation with the protection of the interests
    of a minor client. Thus, a trial court “must give consideration
    to the terms of any representation agreement made between
    the attorney and the representative of the minor or person
    with a disability and must evaluate the agreement based on the
    facts and circumstances existing at the time the agreement was
    made.” (Cal. Rules of Court, rule 7.955(a)(2), italics added.)
    Among the considerations is the length of the attorney’s delay
    in receiving payment and risk of obtaining nothing at all. (See
    Cal. Rules of Court, rule 7.955(b)(13)). In addition, the rule states
    that “the value of the [attorney’s] services” (Cal. Rules of Court,
    rule 7.955(b)(2)), “the skill required to perform the legal services
    properly” (Cal. Rules of Court, rule 7.955(b)(3)), the attorney’s
    11
    “experience, reputation, and ability” (Cal. Rules of Court,
    rule 7.955(b)(7)), and “[t]he time and labor required” (Cal. Rules
    of Court, rule 7.955(b)(8)) are all relevant factors.
    All of these factors support a recovery greater than
    10 percent. One of the two attorneys who primarily worked
    on the case, Ian Herzog, had 47 years of experience in aviation
    accident cases, and the other, Thomas Yuhas, had 37 years of
    experience. Both attorneys also have many years of experience
    as pilots, which undoubtedly gave them insight as to the causes
    of the crash. In this case, both sides agree that the risk of loss
    was substantial. When viewed from the perspective of the time
    it was signed, the representation agreement thus realistically
    evaluated the high risk that there could be no recovery at all or
    one substantially lower than was achieved.
    Herzog increased its risk by advancing more than $300,000
    in costs in the case. Silke and Asia Today reimbursed some of
    those expenses many months later, but Herzog incurred at least
    $83,829.53 in expenses for which the firm was not entitled to
    reimbursement if it did not win a recovery. And very importantly,
    all parties agree that Herzog obtained a very good recovery for its
    clients considering the circumstances of the case.
    California Rules of Court, rule 7.955 also contains protections
    to ensure that attorneys do not take advantage of their minor
    clients. A court considering attorney fees may take into
    consideration “[t]he informed consent of the representative of the
    minor” (Cal. Rules of Court, rule 7.955(b)(9)) and “[t]he relative
    sophistication of the attorney and the representative of the minor
    or person with a disability” (Cal. Rules of Court, rule 7.955(b)(10)).
    The record demonstrates that Silke, who after Rainer’s death took
    a major role in the management of Asia Today, was sophisticated.
    She also was assisted by corporate counsel and the chief executive
    officer of Asia Today in negotiations with Herzog. She had options
    other than using a contingent fee lawyer because she had sufficient
    12
    resources to hire attorneys by the hour. According to Herzog, the
    clients elected to hire an attorney on a contingency basis because
    of the significant risk involved in the case, and because they wanted
    an attorney who had “skin in the game.”
    As important and relevant to the factors in California Rules
    of Court, rule 7.955, no other attorneys Silke had contacted would
    take the case on a contingency basis. Moreover, the fee percentages
    were within the range commonly accepted at the time for adult
    plaintiffs.
    As justification for reducing Herzog’s fee, the trial court cited
    the needs of Silke’s children, in particular those suffering from
    severe disabilities. Thus, the court noted that according to one
    expert, the children would likely incur medical expenses totaling
    $76 million over the course of their lives, and that the total value
    of the settlement would not be sufficient to cover all these expenses.
    The court concluded that it “must assiduously protect these minors
    to the extent possible given the amount of settlement proceeds to be
    allocated.”
    We accept that a child’s needs are a relevant and important
    factor in determining a reasonable attorney fee—California Rules
    of Court, rule 7.955(b)(1) states that the court may consider “[t]he
    fact that a minor . . . is involved and the circumstances of that
    minor.” This single factor, however, cannot overwhelm all other
    considerations. Indeed, an overly strong emphasis on the client’s
    medical needs when determining attorney fees could have the
    perverse effect of reducing access to the courts to the neediest.
    If attorneys know that courts are likely to drastically reduce their
    contingency fee awards irrespective of the other considerations
    in California Rules of Court, rule 7.955, it will be difficult or
    impossible for those most in need to find qualified attorneys to
    handle their cases.
    The court’s only criticism of Herzog’s representation was
    that the firm failed to notify Rainer’s adult daughters about the
    13
    existence of the lawsuit until a relatively late stage, which may
    have contributed to the animosity between the daughters and
    Silke and led to more drawn out litigation regarding the settlement
    distribution. But even accepting that as a valid criticism, it did
    not justify so low an award when so many other considerations
    suggested a significantly higher fee award.
    The arbitrariness of the trial court’s award of only 10 percent
    for attorney fees was compounded by the court’s allocation of the
    settlement dollars. More specifically, the apportionment of the
    proceeds between Silke and the children directly affected Herzog’s
    recovery because the court has authority to reduce attorney fees
    only with respect to those portions of an award payable to a minor.
    In this case, if the trial court had apportioned even one-fifth of
    the settlement funds to Silke—an amount that would not seem
    unreasonable—it would have meant about $750,000 in additional
    fees to Herzog under the retainer agreement with Silke.
    Finally, Herzog contends that, rather than remand the
    case to the trial court for further proceedings, we should decide
    for ourselves whether Herzog’s requested fee was reasonable. We
    decline to do so. We recognize that “ ‘ “[t]he ‘experienced trial judge
    is the best judge of the value of professional services rendered in
    his court’ ” ’ ” (Thayer v. Wells Fargo 
    Bank, supra
    , 92 Cal.App.4th
    at p. 832) and it is not our role, even upon reversal, to decide in the
    first instance what that fee should be.
    III.   Forfeiture
    Silke, as guardian ad litem, contends that Herzog forfeited
    its objection to the distribution of settlement proceeds by failing
    to file an objection to the statement of decision. In support of this
    position, Silke cites In re Marriage of Arceneaux (1990) 
    51 Cal. 3d 1130
    (Arceneaux), in which our Supreme Court stated that after
    the trial court issues a statement of decision, a “party must state
    any objection to the statement in order to avoid an implied finding
    14
    on appeal in favor of the prevailing party.” (Id. at p. 1133.)
    According to Silke, because Herzog failed to object to the trial
    court’s failure to take into account relevant factors regarding
    attorney fees, the firm may not now raise those contentions on
    appeal. We are not persuaded.
    The Court’s decision in Arceneaux was based on its
    interpretation of Code of Civil Procedure sections 632 and 634.
    As the Court explained, “When the court announces its tentative
    decision, a party may, under section 632, request the court to
    issue a statement of decision explaining the basis of its
    determination, and shall specify the issues on which the party is
    requesting the statement; following such a request, the party
    may make proposals relating to the contents of the statement.
    Thereafter, under section 634, the party must state any objection
    to the statement in order to avoid an implied finding on appeal
    in favor of the prevailing party.” 
    (Arceneaux, supra
    , 51 Cal.3d
    at p. 1133, fn. omitted.) Under the terms of the statute, however,
    an implied finding applies only “[w]hen a statement of decision does
    not resolve a controverted issue, or if the statement is ambiguous.”
    (Code Civ. Proc., § 634; accord, 
    Arceneaux, supra
    , 51 Cal.3d
    at p. 1136 [“if the statement fails to resolve a controverted issue or
    is ambiguous[,] the defects must be brought to the court’s attention
    to avoid presumptions in favor of the judgment”].)
    In this case, the trial court did resolve the issue of attorney
    fees and stated its reasoning clearly. Herzog’s objections are not
    about the court’s factual findings, but rather about the court’s
    exercise of its discretion in reducing Herzog’s award. The only
    inference to be drawn from the court’s failure to discuss the factors
    of California Rules of Court, rule 7.955 in its statement of decision
    is that the court found those factors unimportant in this case.
    Neither Arcenaux nor Code of Civil Procedure section 634 requires a
    party to file an objection to a statement of decision reiterating every
    rejected argument in order to preserve those arguments on appeal.
    15
    DISPOSITION
    The judgment of the trial court is reversed. Appellant is
    awarded its costs on appeal.
    NOT TO BE PUBLISHED.
    ROTHSCHILD, P. J.
    We concur:
    JOHNSON, J.
    BENDIX, J.
    16
    Filed 10/2/18
    CERTIFIED FOR PUBLICATION
    IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
    SECOND APPELLATE DISTRICT
    DIVISION ONE
    NICOLAS SCHULZ, a Minor, etc.,               B277493
    et al.,
    (Los Angeles County
    Plaintiffs and Respondents,
    Super. Ct. No. BC 537157)
    v.
    JEPPESEN SANDERSON, INC.,
    et al.,
    Defendants;
    HERZOG, YUHAS, EHRLICH
    & ARDELL, APC,
    Appellant.
    THE COURT:
    The opinion in the above-entitled matter filed on
    September 5, 2018, was not certified for publication in the
    Official Reports. For good cause, it now appears that the
    opinion should be published in the Official Reports and it is
    so ordered.
    _____________________________________________________________
    ROTHSCHILD, P. J.        JOHNSON, J.       BENDIX, J.
    

Document Info

Docket Number: B277493

Filed Date: 10/2/2018

Precedential Status: Precedential

Modified Date: 4/17/2021