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Thomas Ostly v. Robert Salinas et al

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA FIRST APPELLATE DISTRICT DIVISION FOUR


December 10, 2010

THOMAS OSTLY, PLAINTIFF AND APPELLANT,
v.
ROBERT SALINAS ET AL., DEFENDANTS AND RESPONDENTS.

(Alameda County Super. Ct. No. RG 09434713)

The opinion of the court was delivered by: Reardon, J.

Ostly

v.

Salinas CA1/4

Received for posting 12/14/10

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

Appellant and attorney Thomas Ostly brought an action against a law firm and two attorneys for breach of fiduciary duty. Respondents Robert Salinas and his law firm Sundeen Salinas & Pyle successfully demurred to the complaint, which the trial court sustained without leave to amend. On appeal from the subsequent judgment of dismissal,*fn1 Ostly contends that (1) the complaint alleged a cause of action for breach of fiduciary duty against Salinas and the firm; (2) the trial court should have given him leave to amend his complaint; and (3) it abused its discretion in not granting his motion for continuance to allow him to personally appear to oppose the demurrer. We affirm the judgment.

I. FACTS

A. The Birdsong and Lopez Lawsuits

In 2004, appellant Thomas Ostly was retained by plaintiff Roberta Birdsong to represent her in an unlawful detainer action. (Birdsong v. Murray (Super. Ct. Alameda County, 2005, No. WG04190959).) Ostly had a written fee agreement with Birdsong providing that his fee would be limited to attorney fees recovered after a favorable jury verdict. After obtaining a verdict in her favor, Ostly drafted a motion for attorney fees. He also hired respondent Robert Salinas, an attorney with respondent Sundeen Salinas & Pyle, to review and argue the motion. Salinas appeared at the hearing on the motion along with Ostly.

After Birdsong's action was final, Salinas and Attorney Ira Jacobowitz represented several of Ostly's former clients in an unrelated lawsuit. (Lopez v. Rosen (Super. Ct. Alameda County, No. RG05233767).) In that case Ostly sought attorney fees from his former clients.

B. Procedural History

In February 2009, Ostly filed this action against Salinas, the law firm of Sundeen Salinas & Pyle, and Jacobowitz, alleging a breach of fiduciary duty. Specifically, the complaint alleged that Ostly and Salinas had formed an attorney-client relationship as a result of their association as counsel in the Birdsong matter. It also alleged that, as a result of this relationship, Salinas obtained confidential information about settlements and fee awards which he used against Ostly in the Lopez lawsuit, in breach of his fiduciary duty to Ostly.

Salinas and his law firm demurred to the complaint. Ostly opposed the demurrer, but did not seek leave to amend. On May 21, 2009, Ostly was represented by counsel at the hearing on the demurrer and did not personally appear. The trial court sustained the demurrer without leave to amend. Ostly's motion for reconsideration was denied.

II. DISCUSSION

A. Demurrer

1. Elements for Breach of Fiduciary Duty

Ostly first contends that his complaint pled a cause of action for breach of fiduciary duty. The elements of this cause of action are: (1) the existence of a fiduciary duty; (2) a breach of that duty; and (3) resulting damage. (City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1998) 68 Cal.App.4th 445, 483.) In doing so, he challenges the trial court's order sustaining Salinas and the law firm's demurrer.

2. No Fiduciary Duty

Ostly asserts that an attorney-client relationship was formed between himself and Salinas's law firm when he hired Salinas to assist him with the attorney fee motion in Birdsong's case. When reviewing a judgment dismissing a complaint after the granting of a demurrer without leave to amend, we must assume the truth of the complaint's properly pleaded or implied factual allegations. We also consider matters which may be judicially noticed. In addition, we give the complaint a reasonable interpretation, and read it in context. When the trial court sustained the demurrer, we determine whether the complaint states facts sufficient to state a cause of action. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)

Generally, the attorney of record has the exclusive right to appear in court for his or her client. Neither the party nor another attorney may appear in the case. (Wells Fargo & Co. v. City etc. of S.F. (1944) 25 Cal.2d 37, 42-43.) However, California courts have long taken judicial notice of the custom of attorneys hiring other attorneys to assist in their legal work, including making court appearances, without the formality of being made attorneys of record. (Raskin v. Superior Court (1934) 138 Cal.App. 668, 670; see Streit v. Covington & Crowe (2000) 82 Cal.App.4th 441, 446, fn. 3.) Thus, if the attorney of record associates another attorney, it rests with them to divide the duties concerning the handling of that case. (Wells Fargo & Co. v. City etc. of S.F., supra, 25 Cal.2d at p. 43.)

However, Ostly's hiring Salinas and his law firm did not transform Ostly into a client nor Salinas and his firm into Ostly's counsel. No fiduciary duty arises between co-counsel when they conduct their joint representation in a manner that does not diminish or eliminate the fees each expects to collect. (Beck v. Wecht (2002) 28 Cal.4th 289, 298.) Here, both Ostly and Salinas appeared on behalf of Birdsong. As a matter of law, Salinas owed his duty to Birdsong, not to Ostly.

Ostly also reasons that Salinas and the law firm owed him a duty based on the assignment of the right to attorney fees that Birdsong assigned to Ostly in his fee agreement with Birdsong. This is an improper understanding of the law. A contingent fee contract between an attorney and client does not make the attorney an equitable owner of a share in the client's cause of action. Instead it gives the attorney a security interest in the proceeds of the litigation. (Isrin v. Superior Court (1965) 63 Cal.2d 153, 161.) A contingent fee contract does not create an assignment or lien giving the attorney the beneficial rights of a real party in interest. (Id. at p. 158.) Ostly has no interest in the Birdsong matter that could form the basis of an attorney-client relationship with Salinas and his law firm. The trial court properly concluded that Salinas and his law firm owed no fiduciary duty to Ostly.

B. Leave to Amend

Ostly next contends the trial court erred by not giving him leave to amend his complaint. When a trial court sustains a demurrer without leave to amend, we must decide whether there is a reasonable possibility that the plaintiff could cure the defect amending the complaint. If an amendment could cure the defect, the trial court abused its discretion and we will reverse; if not, no abuse of discretion has occurred. Ostly, as the plaintiff, has the burden to prove that an amendment would cure any defect. (See Blank v. Kirwan, supra, 39 Cal.3d at p. 318.) He has not met this burden. In the trial court, he did not seek leave to amend. On appeal, Ostly asserts no additional facts that might establish a fiduciary relationship with Salinas and his firm. Thus, we conclude that the trial court did not abuse its discretion in sustaining the demurrer without leave to amend.

C. Continuance

Finally, Ostly argues that trial court abused its discretion in not granting him a continuance to allow him to personally appear and argue against the demurrer.*fn2 The record does not include any request for a continuance. Ostly asserts that he made several requests to be allowed to appear by telephone that were denied. Even if we found that the record was sufficient to demonstrate that he made this request and it was denied, we find no prejudice.

We review a trial court's denial of a motion for a continuance for an abuse of discretion. (In re Ernesto H. (2004) 125 Cal.App.4th 298, 316.) Ostly was represented by counsel at the hearing. He offers no argument how his personal attendance would have changed the outcome of the case. As no prejudice resulted from the denial of the continuance to allow Ostly's personal appearance, the trial court would not have abused its discretion by finding no good cause for the request.

III. DISPOSITION

The judgment is affirmed.

We concur:

Ruvolo, P.J.

Sepulveda, J.


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