California Litigation Blog

Does A Second Section 998 Settlement Offer Extinguish The First?

Jeff Huron — Sat, 17 Mar 2012 09:26:14 -0800

The answer is both “yes” and “no,” because there is a clear split of authority between the California Court of Appeals.

Code of Civil Procedure section 998 permits a party to make a written settlement offer with the potential to shift costs and fees to another party if that party does not accept a good faith 998 offer and then fails to obtain a better result.

In Wilson v. Wal-Mart Stores, Inc. (1999) 72 Cal.App.4th 382, the Third District Court of Appeal first noted that section 998 is silent as to the effect of multiple offers. The court then applied contract principles to conclude that a new offer made prior to acceptance of a previous offer extinguished and replaced the prior one. Additionally, the court reasoned that a different rule would enable litigants to make offers that could discourage settlement and thus it was better to have a bright line rule that the most recent 998 offer would control regardless of earlier offers.

Recently, the Second District Court of Appeal reached the opposite conclusion in Martinez v. Brownco Construction Company, Inc. (2012) 203 Cal.App.4th 507. Also, applying contract principles, the Martinez court concluded that a 998 offer that is not accepted lapses and thus has no more effect. In other words, a later 998 offer cannot extinguish an earlier lapsed offer. Furthermore, the Martinez court recognized that denying litigants the benefits of earlier offers would actually discourage settlement. And it noted that courts could control any gamesmanship because they have discretion to determine whether a 998 offer was made in good faith; and only good faith offers trigger section 998’s cost shifting mechanism.

The Martinez decision is better reasoned and certainly does a better job promoting settlement during times when courts are underfunded and overburdened. However, until the California Supreme Court resolves this issue, attorneys should keep in mind that a second 998 offer does not necessarily extinguish any prior offers, and that their clients may be on the hook for costs and fees dating back to the earliest 998 offer if they fail to obtain a better result.

A Judgment against A Trust Is Unenforceable

Jeff Huron — Wed, 01 Feb 2012 08:52:27 -0800

The recent decision of Portico Management Group, LLC v. Harrison __ Cal.App.4th __ (2011) held that a trust is neither a person nor an entity. As such, a trust cannot sue or be sued. And a judgment against a trust is unenforceable because a judgment debtor is defined as a “person” against whom a judgment is entered. Therefore, when suing a trust, you must: (1) name the trustee in his or her representative capacity as a trustee; and (2) ensure that judgment is entered against the trustee; and not the trust itself.

The plaintiff in Portico, sued the trustees of a trust but unfortunately did nothing to correct an arbitration award and subsequent judgment entered against only the trust. Plaintiff later attempted to enforce the judgment against assets of the trust. However, the trustees of the trust claimed ownership of the trust assets and argued that no judgment had been entered against them or their predecessors. The court of appeal agreed and affirmed the trial court’s order to grant the trustees’ claim of ownership to the assets of the trust. Fortunately for the plaintiff, the court of appeal reversed (with instructions) the trial court’s orders denying leave to amend the judgment to include one of the original trustees.

Bottom line: If you have litigation involving a trust, don’t make the mistake of treating the trust as you would a person or an entity.

When A Court Grants an Injunction on the Merits No Undertaking Is Required

Jeff Huron — Mon, 23 Jan 2012 12:47:35 -0800

The Court in Bardasian v. Superior Court 201 Cal.App.4^th 1371 (2011) issued a peremptory writ and reversed an order dissolving an injunction because plaintiffs failed to post a bond. The case involved a foreclosure dispute between borrowers and their lender over whether the lender complied with Civil Code section 2923.5, subd. (a). Pursuant to that section, a lender must contact the borrower to try to prevent foreclosure before recording a notice of default.

In granting the borrowers' motion for an injunction, the trial court expressly found that neither the lender nor its servicer contacted the borrowers before issuing a notice of default. The trial court, however, required plaintiffs to post a $20,000 bond and make $500 monthly payments. It later dissolved the injunction when plaintiffs failed to post the bond and make monthly payments.

The appellate court concluded that the trial court erred in requiring a bond in the first place. The trial court did not merely determine that plaintiffs had a substantial likelihood of success on the merits, but rather decided the dispute in plaintiffs' favor. The purpose of an injunction is to protect the defendant against losses incurred if the defendant later prevails on the merits. Therefore, no undertaking is required when the court grants an injunction after deciding the merits. Shahen v. Superior Court (1941) 46 Cal.App.2d, 187, 189 (bond cannot be ordered on a permanent injunction issued after a trial on the merits).

Posting bonds is often difficult and expensive for clients. Whenever you seek an injunction, try to get the court to rule on the merits. If you succeed, you remove the requirement for a bond or undertaking.

He Who Hesitates, May be Too Late!

Jeff Huron — Thu, 27 Oct 2011 19:15:26 -0800

In Trident Labs, Inc. v. Merrill Lynch Commercial Finance Corp., the Court of Appeal held that a party, who has the option to litigate in more than one forum and litigates extensively in one forum, cannot then decide to enforce its rights to litigate in another forum. Pursuant to a forum selection clause, Trident Labs agreed to waive any rights to commence an action anywhere but Illinois. Trident nevertheless sued Merrill Lynch in California. Merrill Lynch actively litigated the case for 19 months in California by filing a cross-complaint, conducting substantial discovery and filing motions seeking relief. Merrill Lynch then filed a motion pursuant to Code of Civil Procedure section 410.30 to stay or dismiss the lawsuit based on the forum selection clause. Merrill Lynch contended that it had the right to make the motion "at any time," and the trial court agreed. The Court of Appeal noted that section 410.30 does not say such motions may be made at any time. "Where no limits are stated, a reasonableness standard is inferred." The Court of Appeal concluded that 19 months of delay, without any justification, is unreasonable as a matter of law and reversed the trial court. Moral of the story: Don't delay!

Boilerplate Contract Language By Design, Not By Accident

Jeff Huron — Sun, 22 May 2011 17:12:40 -0800

Do you skip the boring boilerplate in contracts before signing them? If so, you could be in for a big surprise later if there is a contract dispute. Before you sign any contract, you should focus on how disputes will get resolved. You are best served if there is language that provides for each of the following: (1) mediation prior to litigation; (2) reimbursement of attorneys' fees; and (3) litigation, not arbitration.

MEDIATION FIRST: Although the majority of lawsuits are settled, it is usually after the parties have incurred substantial attorneys' fees. Mediation should occur early and often until the dispute is resolved. Your next contract should therefore make mediation mandatory before either side may file a lawsuit. Anyone who sues first, loses his or her right to recover attorneys' fees.

ATTORNEYS' FEES: You want to discourage lawsuits by ensuring that the loser pays the winner's legal fees. The fee language should be broad enough to cover any dispute arising out of or related to the contract.

LITIGATION, NOT ARBITRATION: In arbitration, you give up the right to a jury trial and an appeal. This means that your stuck with a bad decision--even an incorrect one--unless you can prove the arbitrator was biased. Arbitration is also expensive and often inefficient.

Interest Provisions Are Enforceable

Jeff Huron — Sun, 20 Mar 2011 14:37:37 -0800

The California Supreme Court has definitively upheld contractual obligations for payment of interest charges on late payments. Southwest Concrete Products v. Gosh Construction Corp., 51 Cal.3d 701 (1990), involved a dispute between a contractor and its pipe supplier. The supplier sued the contractor when it failed to pay after alleging the pipe was of poor quality. The supplier’s invoices contained an interest provision on late payments at the rate of 1 ½% per month (18% per year). After the jury found in favor of the supplier, the trial court awarded the supplier prejudgment interest at the contract rate of 18% per year rather than the 10% legal rate for prejudgment interest.

The issue of whether the interest charges violated the usury law establishing maximum rates of interest reached the Supreme Court. In upholding the interest charges, the Supreme Court ruled that the law of usury applies only to a “loan or forbearance.” The contractor did not claim that the contract involved a loan, but argued instead that the interest charge provision amounted to forbearance.

The Supreme Court disagreed. Forbearance is when the creditor agrees to refrain from enforcing the debt immediately and gives the debtor more time to pay. The supplier’s invoices required the contractor to pay the interest charges on any unpaid balance after the tenth day of the following month of the date of purchase. The supplier did not agree to forbear enforcement, and the fact that it filed suit was proof that it did not agree to refrain from enforcing the debt. Therefore, the Supreme Court found the usury law did not apply to the interest charges and upheld the trial court’s award.

If you provide services or materials, then you should include an interest provision in your contracts or invoices.

Here are two examples:

Late charges will be imposed on any balance remaining unpaid after 30 days computed at 1.5% per month (18% per year). Your unpaid balance is determined by taking the beginning balance of your account for each month, adding any new charges and subtracting any payments and credits made to your account. We will then multiply this amount by the applicable monthly periodic rate of 1.5% to compute the late charge for your account for that month.
Net 30; Interest at 1.5% per month after 30 days.

Lost Profits May Not Be Lost

Jeff Huron — Thu, 17 Feb 2011 16:19:58 -0800

Lost profits are net gains made from sales, after deducting expenses. They are recoverable in California if there is sufficient evidence to show with reasonable certainty that, but for the defendant's conduct, the plaintiff would have earned such profits. However, the plaintiff does not have to prove the exact amount of its lost profits.

For an established business, lost profits may be proven from the past volume of business and other provable data relevant to the probable future sales. It is more difficult to prove lost profits for an unestablished business. Courts frequently decline to award lost profits for such new businesses because the absence of income and expense experience renders anticipated profits too speculative to meet the standard of reasonable certainty.

Nonetheless, lost profits for an unestablished business can be proven in various ways, including with expert testimony, economic and financial data, market surveys and analyses, business records of similar enterprises, and the like. Other evidence relevant to proving lost profits for new businesses includes: (i) whether the business is in an established market; (ii) the plaintiff’s experience in the business he or she is seeking to establish; (iii) the defendant’s own pre-dispute projections (if, for example, the dispute involves the sale of a business); and (iv) the experience of others in a similar business.

If evidence of lost profits includes a comparison to other businesses, those businesses must be sufficiently similar. The comparable businesses must operate under similar conditions, such as the same area and with the same equipment.

Beware of the Attorneys' Fee Trap In Arbitration!

Jeff Huron — Fri, 17 Sep 2010 14:01:37 -0800

Did you know that the Commercial Arbitration Rules for the American Arbitration Association permit an arbitrator to award attorneys' fees if all parties have requested such an award? Pursuant to R-43 of the Rules, the arbitration award may include "an award of attorneys' fees if all parties have requested such an award."

In other words, if you file a demand for arbitration and request fees, and the respondent files an answering statement requesting fees, then the arbitrator may award the prevailing party fees even if there is no agreement providing for the recovery of fees! Therefore, if neither side is legally entitled to the recovery of attorneys' fees, you must be very careful not to unwittingly request attorneys' fees in your arbitration demand or answering statement because it could end up costing your client the other side's attorneys' fees.

What To Do When You Are Sued!

Jeff Huron — Wed, 15 Sep 2010 19:25:23 -0800

When you are sued, you should react just as a battleship when it comes under attack because you are under attack. Alarm bells should go off and you should immediately act to prevent or contain damage. The following actions will help protect you after you have been sued:

Contact Your Insurance Company. Review all of your insurance policies for possible coverage. Immediately notify your broker and insurance company if you believe you might be covered under your policy. You may lose coverage if you delay notifying your insurance company of the lawsuit. If you are covered, your insurer will defend you in the suit and hold your harmless from any loss. If it is unclear whether your policy provides for coverage, the insurer may have to defend you or your business even it is later determined that your policy does not provide for coverage. Therefore, err on the side of coverage and document your conversations with your broker and insurer. Remember, however, your conversations with your broker are not privileged and may be used against you by the insurer in evaluating whether there is coverage.
Begin Preparing Your Defense. Read and understand the complaint before talking to an attorney. Note your initial responses to the allegations and provide them to your attorney as soon as possible. Gather all of your documents, including emails. Record and save any voice messages that may be useful to your defense. Talk to witnesses. If they say anything that supports your defense, send them a letter or email confirming their statements to you.
Hire the Right Attorney. Do not wait for the insurance company to hire an attorney for you. In many cases, the insurance company will take more than 20 days to accept or deny coverage. Give yourself time to hire the right attorney. For example, hiring an attorney with no (or very little) trial experience is probably not the right choice, especially in high-stakes litigation.
The Best Defense Is A Good Offense. Give serious thought about whether you have any grounds for asserting claims against the plaintiff. If you do, then you should countersue the defendant. Make sure you and your attorney thoroughly explore grounds for a countersuit because a countersuit will put the plaintiff on the defensive and give you leverage in settlement discussions.
Stay Proactive. Communicate with your attorney regularly. Make suggestions and recommendations concerning your defense. Success depends on employing the right tactics at the right time as much as the merits of your defense. Let your attorney know if you do not agree with his or her defense tactics. You know your adversary best and should provide as much insight as possible to your attorney about your adversary's motivations, strengths and weaknesses.

California Supreme Court Throws Out the Waiver Rule!

Jeff Huron — Sat, 07 Aug 2010 15:51:59 -0800

The California Supreme Court's recent decision in Reid v. Google, Inc. is welcomed news for judges and trial lawyers.

Previously, if a trial court failed to rule on objections to summary judgment evidence, the objections were waived and not preserved for appeal. (Ann M. v. Pacific Plaza Shopping Center (1993) 6 Cal.4th 666, 670, fn. 1; Sharon P. v. Arman, Ltd. (1999) 21 Cal.4th 1181, 1186-1187, fn. 1.) The waiver rule created tension between overworked judges that are often bombarded with objections to summary judgment evidence, and trial lawyers who were required to request rulings on the objections at least twice at the summary judgment hearing to avoid waiving them. The waiver rule also presented problems for Courts of Appeal: some applied the waiver rule; while others considered evidentiary objections despite the lack of trial court rulings. In Reid, the California Supreme Court disapproved of its decisions Ann M and Sharon P, so the waiver rule and the tension it created are behind us.

Now, things are simple for all concerned. To preserve objections for appeal, litigants must simply object to specific evidence in writing before, or orally at, the summary judgment hearing. See Cal. Rules of Court, Rule 3.1352. If the trial court fails to rule on the objections, then "it is presumed that the objections have been overruled, [] the trial court considered the evidence in ruling on the merits of the summary judgment motion, and the objections are preserved on appeal."

The Supreme Court also disapproved of Biljac Associates v. First Interstate Bank (1990) 218 Cal.App.3d 1410, 1419 to the extent that it permits a trial court to avoid ruling on evidentiary objections, and encouraged attorneys to limit their evidentiary objections to those that "really count."

I can't think of a more practical result.

California Supreme Court to Resolve Dispute Over Discoverability of Witness Statements

Jeff Huron — Sat, 24 Jul 2010 12:27:26 -0800

Last month the California Supreme Court granted review in Coito v. Superior Court (2010) 182 Cal.App.4th 758.

In a 2-1 decision, the Fifth District Court of Appeal held in Coito that witness statements prepared or recorded by an attorney or his agent are not attorney work product and thus discoverable. The Coito majority rejected the contrary holding of the Third District Court of Appeal in Nacht & Lewis Architects, Inc. v. Superior Court (1996) 47 Cal.App.4th 214 that recorded witness statements taken by counsel are absolute work product because they would reveal counsel's impressions, conclusions, and opinions and thus are not discoverable.

A clear conflict now exists: on the one hand, attorney-prepared witness statements are always discoverable; and on the other hand, they are never discoverable.

I believe the Supreme Court will adopt a middle-of-the-road solution along the lines proposed by Justice Stephen Kane in his persuasive concurring and dissenting opinion in Coito. Justice Kane's proposal for resolving discovery disputes over attorney-prepared or recorded witness statements involves the following three principles:

Attorney-prepared witness statements are not per se absolute attorney work product. Rather, the absolute privilege of work product applies only to an attorney's "impressions, conclusions, opinions or legal research or theories" and matters inextricably intertwined with them
Witness statements prepared or recorded by an attorney or his agent constitute qualified attorney work product and are discoverable subject to a showing of need pursuant to Code of Civil Procedure section 2018.030(b).
A party should be required to respond to form interrogatory no. 12.3 unless he sets forth foundational facts that support the assertion of the qualified work product privilege.

Stay tuned. Help is on the way. In the meantime, trial courts will have to continue struggling with the competing decisions of Coito and Nacht & Lewis Architects.

Lis Pendens

Jeff Huron — Tue, 20 Jul 2010 10:35:07 -0800

The volume of real estate litigation has increased dramatically because of the depressed economy. In times like these, it is more important than ever for real estate attorneys to be familiar with recent changes in lis pendens law. For an in-depth discussion of recent changes in California lis pendens law, you should read Lis Pendens.

Spoliation as Evidence of Guilt

Jeff Huron — Sat, 17 Jul 2010 12:10:08 -0800

In determining what inferences to draw from the evidence against a party, the jury is permitted to consider a party's willful suppression of evidence. Evid. Code Section 413. In Thor v. Boska (2nd Dist. 1974) 38 Cal.App.3d 558, a doctor, who was sued for malpractice, failed to produce his original charts. His explanation was that, after copying the records verbatim to make them more legible, he must have thrown away the originals. The fact that "the defendant was unable to produce his original clinical record concerning his treatment of the plaintiff after he had been charged with malpractice, created a strong inference of consciousness of guilt on his part."

Today, it is increasingly more common for parties to suppress harmful evidence, such as email. If they do, their conduct is admissible at trial. We had a case where the chief executive officer removed back-up tapes of electronic data from the company's safe. Neither the officer nor the company produced the tapes during discovery. At trial, the officer's removal of the tapes was powerful evidence that helped convince the jury to find fraud and award punitive damages.

How to Select an Expert Witness

Jeff Huron — Sat, 12 Sep 2009 21:59:11 -0800

In today’s litigation practice, experts are frequently called upon to give their opinions. Even though experts are paid witnesses, their testimony is invaluable in educating judges and juries. The right or wrong expert is often the difference between winning and losing.

Unfortunately, however, parties and their attorneys often start their search for an expert too late and then settle on the first one who readily agrees with their position and is available on short notice. If this is how you or your attorney go about selecting experts, you are needlessly jeopardizing your chances of success.

The following suggestions for selecting an expert witness come from my years of experience as a trial lawyer in locating, preparing and examining expert witnesses:

Start Your Search Early. By talking to experts, you may learn of problems with your case. Getting bad news early can save you a lot of time, money and aggravation. Furthermore, if you retain an expert before discovery is complete, he can make sure that you are requesting the right documents and asking the right deposition questions. You also want to win the race to retain the best expert for your case. Most importantly, you want to give your expert sufficient time to prepare.

Credentials and Experience Are Extremely Important. The expert you select must have impeccable credentials (third world medical degrees will not do) and experience with similar cases. If your expert lacks either, your opponent will exploit your expert’s questionable credentials or lack of experience with the jury.

Request Reports and Publications. Ask to see some of the reports that the prospective expert has prepared for similar cases. The reports will reveal whether the expert understands the issues and can explain his opinions in a clear and concise manner. Prior publications represent a minefield for prior inconsistent opinions. Therefore, make sure that you obtain and review all the prospective expert’s prior publications before selecting him.

Give The Prospective Expert All the Information (Good and Bad). Tell the prospective expert all the information, especially the information that is unfavorable to your position. Withholding unfavorable information from your expert will only lead to disaster. When the unfavorable information comes out (and it will), your expert will have to choose between changing his opinion or defending the unreasonable. If your expert is not credible, then his testimony will not be useful to you.

Meet In Person. Meet with the prospective expert in person. The expert’s appearance and demeanor are important. Is the expert prepared for the meeting? Is he comfortable stating his opinions? Can he explain them in a way that a jury will understand? How well does he respond to difficult questions that your opponent is likely to ask him?

Check References and Call Opposing Counsel. Ask the prospective expert to give you the names of the attorneys involved in the most recent cases in which he testified. Call the attorneys who used the expert as well as the attorneys who deposed and cross-examined him. Find out what the attorneys on both sides thought of the expert.

News & Articles

April 2009 Website Recommendation

Jeff Huron — Sun, 26 Apr 2009 11:50:58 -0800

In addition to doing traditional legal research, I regularly search the Internet. One of my favorite websites is California Discovery & Privilege Law hosted by Richard E. Best, a retired San Francisco Superior Court Commissioner. As a bench officer, Commissioner Best presided over discovery disputes for twenty years. Commissioner Best currently serves as a private discovery referee and consultant. Make sure to bookmark this site; it’s a great reference for meet and confer letters and discovery motions.

Know Your Judge

Jeff Huron — Sun, 12 Apr 2009 20:11:54 -0800

The reality in litigation is: "The law is whatever the judge says it is." The chances of getting an unfavorable decision reversed by the Court of Appeal are slim. According to the 2007 Court Statistics Report, the California Court of Appeal affirmed 88% of decisions made by trial judges between 2005 and 2006. Therefore, it is important to know your judge.

You can find information about judges on the Internet, by word of mouth, from bar associations such as the Los Angeles County Bar Association, and in Judicial Profiles published by the Daily Journal. You can also learn valuable information about your judge by researching his decisions which have been appealed.

If you have never appeared before the judge assigned to your case, you should make a point of observing him and talking to attorneys who have appeared before him. What is the judge's background? What is his political bent? What is his temperament? How does he manage his calendar? Does he push cases to settle or trial? What is his attitude towards discovery disputes, sanctions, and motions for summary judgment?

You may decide for obvious reasons that you do not want a judge who worked as a defense lawyer and insurance adjuster to preside over your client's bad faith case. You have only ten days to disqualify the judge if he is not right for your case. Of course, the risk in disqualifying the judge is that you could end up with a worse judge for your case. However, on the rare occasions when we have disqualified judges, we always have been fortunate to receive a better judge for our case than the one we disqualified. If you disqualify your judge and end up drawing a worse one, there is always the possibility that your adversary will use her peremptory challenge to disqualify the newly assigned judge. For these reasons, the risk of receiving a worse judge should not deter you from disqualifying a judge that is wrong for your case.

Tenacity and Creative Thinking Are Always Rewarded

Jeff Huron — Thu, 09 Apr 2009 20:46:51 -0800

It should not surprise you, but your opponent will play hide the ball and avoid getting pinned down. Yet many attorneys are not tenacious or creative enough about ensuring victory. Litigators must think outside the box! How can you get evidence you need to win your case? There are always creative ways to locate evidence that your opponent fails to produce. Here are two examples.

We had a case where it was critical to show that the plaintiff controlled a corporation that had received funds as a result of a lender's mistake. At his deposition, plaintiff testified that he had not heard of the corporation and had not received money from it. Most people bank near their homes or work. We identified the banks within a mile of the plaintiff's office and then subpoenaed records pertaining to the corporation from each of them. Bingo! One of the banks produced records, including checks signed by the plaintiff to himself, his wife, lawyer, etc. Case over.
A lawyer whose client died in a helicopter crash sued the helicopter company, alleging that a defective part caused the crash. The company did not produce any documents helpful to plaintiff's case. The plaintiff's lawyer researched other helicopter accidents and learned of a similar accident, which led to the discovery of a prior lawsuit against the company in another state. After tracking down the other plaintiff's lawyer, obtaining and sifting through old files, there it was - an internal company memorandum recommending a recall of the part. The result: a $14 million verdict in a case that the lawyer would have otherwise lost.

Tenacity and creative thinking pay off. Are you doing enough to win your case?

Ready Aim...Settle!

Jeff Huron — Sat, 28 Mar 2009 17:57:51 -0800

Approximately ninety percent of all litigation cases settle prior to trial. Here are 4 tips to help you get the best settlement for your case.

Identify Your Opponent's Motive. A successful settlement involves persuasion. Its easier to persuade your opponent when you know his or her motives. Why did the plaintiff sue? Why is the defendant unwilling to settle? In Doctors Say 'I'm Sorry' Before 'See You In Court,' the New York Times reported that hospitals are starting to disclose medical errors. Why? Disclosure makes patients less indignant, less concerned that mistakes will happen again, and thus less likely to sue. At the University of Illinois, only one patient out of 37 filed suit when its hospital acknowledged a mistake and apologized! It pays to discover your opponent's motive.
Define Your Litigation Objectives. Think about settlement at the outset, not after litigating the case for months! Identify your goals: to obtain a cost-effective result? renegotiate or terminate a contract? prevent future harm? uphold your principles? avoid becoming an easy litigation target? or some other reason? Once you have identified your objectives, all litigation tactics should be geared towards achieving them.
Realistically Evaluate Your Case. Stay objective. A recent study of cases that went to trial between 2002 and 2005 found that plaintiffs received less than the settlement offers they passed up 61% of the time. Defendants ended up paying more after going to trial 24% of the time. In only 15% of the cases studied were both sides right to go to trial. "Study Finds Settling Is Better Than Going to Trial." For these reasons, make sure you identify the elements of each claim and defense. Do you have or can you obtain the evidence to establish the elements you need to succeed? What is your biggest weakness and can it be overcome? What are your opponent's strengths and can you overcome them? If you lose your objectivity, it will cost you!
Negotiate Strongly. Always negotiate from a position of strength. First, prepare for the settlement conference or mediation just as you would for trial, even if you think there is little chance for settlement. Second, be creative at the settlement conference or mediation. Use technology such as computer presentations and video clips of key deposition testimony so that your opponent can visualize the strength of your case. Third, include in your settlement offer terms that you can easily give up in exchange for the terms you do want during the negotiation. It is important to create a well-considered settlement plan to negotiate the best settlement.

Client Owed Money? Get an Attachment

Jeff Huron — Wed, 25 Mar 2009 20:13:38 -0800

With the economy worsening, what can you do to expedite collection of money owed to your client? File a lawsuit and immediately apply for a right to attach order. A right to attach order is a prejudment remedy that may be obtained on 16 court days' notice or upon 24 hours' notice in special circumstances.

Applying for a right to attach order has several advantages. The application encourages defendants to settle by threatening to deprive them of the use of valuable assets during litigation. The application may also trigger defendants suffering from financial hardship to file bankruptcy before you waste time and money obtaining a judgment, which then becomes worthless.

The court will issue an attachment order when (1) there is a claim for money pursuant to a commercial contract, (2) the claim is for a fixed amount or the amount can be easily determined, and (3) the claim is likely to succeed. (Code of Civ. Proc. Section 483.010.) The contract does not even have to be a writing; it can be an oral agreement or simply implied from commercial conduct between the parties. This means that you can obtain a right to attach order for the breach of a loan, lease, employment contract, partnership agreement, and for non-payment of invoices for goods and services.

An attachment entitles you to attach any property held by a corporation, partnership or association. You may also attach personal property such a bank accounts, accounts receivable, equipment and inventory, community property, negotiable instruments and securities, and money kept at a business. (Code of Civ. Proc. Section 487.010.) The Sheriff holds all the property seized until the case is resolved. Because the Sheriff cannot hold real property owned by the defendant, you can record the attachment order, which creates a lien on real property owned by the defendant, preventing him from transfering ownership to another person.

Prior to applying for an attachment order, you can hire a private investigator (such as Transwest Investigations, Inc.) to locate and identify potential assets to determine whether it makes sense to seek an attachment. Investigators charge between $500 and $1500 for such services. A less expensive alternative is to do the search yourself, using websites, such as KnowX. Even if you don't do your own investigation, after the court issues a right to attach order, the defendant must tell you the identity, location and value of property in which he has an interest. (Code of Civ. Proc. Section 485.230.)

The defendant's attached property is security for the satisfaction of your future judgment. Without an attachment, the defendant is free to conceal, encumber, and transfer any assets before you obtain a judgment. Therefore, if you have a meritorious commercial contract claim, it is a mistake not to seek a right to attach order.

Videotape Depositions: Take One

Jeff Huron — Wed, 04 Mar 2009 19:03:24 -0800

California law allows an adverse party to use a deposition of a party for any purpose during trial. See, Code of Civ. Proc. Sec. 2025.620(b) (pdf.). If you videotape your opponent's deposition, this means that you can select and play deposition clips for the jury to watch during your: (1) opening statement; (2) turn to introduce evidence without any opportunity for your opponent to respond; and closing argument. Imagine: jurors get to hear and see your opponent at his or her worst, as if they were watching an entertaining YouTube clip, which most of them do frequently.

Without videotape of your opponent's deposition, you have nothing but a cold, lifeless transcript to read the jurors to sleep. The videotape not only gives jurors something to hear, but also something to see. For example, where a phrase like, "I don't recall," looks boring and standard on a page, video-recorded testimony of the same phrase could be very damaging to your opponent. A video could show your opponent immediately and without hesitation responding aggressively to an important question with, "I don't recall," as if on cue. Or, the video could record your opponent deliberating at length and then looking at his attorney, all the while fidgeting in his seat, before apologetically responding, "I don't recall." Without videotape, all of this non-verbal language is lost forever because the transcript is nothing but boring words on a page - one more among many boring pages and documents shown to jurors during trials.

In his book, Blink, Malcolm Gladwell, supports a claim by the psychologist Paul Ekman that a person's face while speaking can reveal whether he is lying. Gladwell uses several examples to demonstrate, that despite our best efforts to suppress involuntary facial responses, our facial expressions often give us away. One example, occurred during a press conference given by Harold "Kim" Philpy, who had not yet been revealed as a Soviet spy. Twice after being asked serious questions about whether he had committed treason, he smirked like "the cat who ate the canary."

According to Gladwell, we are face readers from the day we are born. As babies we learn to read our parents' faces for acceptance, unhappiness and fear. By adulthood, we instinctively read faces for clues.

In addition to Gladwell's book, Blink, Fox Broadcasting is airing a new television series (Lie to Me) this month based on a specialist who can read clues in the human face, body and voice to expose the truth.

A videotaped deposition allows the jury to read your opponent's face -- during a deposition that he never thought the jury would see. When reviewing your opponent's video, you must concentrate on your opponent's face for "tell-tale" signs. If you catch your opponent smirking, glaring, worried, hesitating, confused, etc., it would be a mistake not to share it with the jury.