Rosenbaum v. Howard

Filed 6/4/07 Rosenbaum v. Howard CA2/1

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION ONE

APPEAL from a judgment of the Superior Court of Los Angeles County. Jan A. Pluim, Judge. Reversed in part with directions and affirmed in part.

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David E. Rosenbaum, in pro. per., and for Plaintiff, Cross-Defendant and Appellant M. Hank Etess.

Barnes, Crosby, Fitzgerald & Zeman, Michael J. Fitzgerald and Eric P. Francisconi for Defendants, Cross-Complainants and Respondents Larry Howard, Metropolitan Hawgs, Inc. Aguila Associates, Inc., and Installation Services.

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Larry Howard, owner of several companies involved in the carpet distribution business including Metropolitan Hawgs, Inc., Aguila Associates, Inc., and Installation Services (collectively, clients), hired attorneys David Rosenbaum and M. Hank Etess (attorneys) to defend clients against an unfair business practices lawsuit (underlying litigation). The parties signed a written retainer agreement providing for binding arbitration to resolve any disputes between them. During eight months of litigation, attorneys claimed to have provided approximately $360,000 in legal services and incurred $65,000 in costs, of which clients had paid approximately $85,000. During that eight-month period, after consulting with Etess, Howard recorded a deed of trust in attorneys favor on Idaho realty owned by one of Howards companies. A dispute arose between the parties regarding attorneys fees in the underlying litigation. Clients hired current counsel to replace attorneys as their lawyers who eventually secured a judgment in clients favor in the underlying litigation. (That judgment is not before us in this appeal.)

The parties agreed to arbitrate their fee dispute before a Los Angeles County Bar Association panel. Attorneys proposed that the arbitration be binding but clients would not agree. At a contested hearing, the arbitration panel concluded that the arbitration was binding and that attorneys were entitled to $85,000 in fees and costs, the amount clients already had paid.

Attorneys then filed this lawsuit, alleging causes of action for breach of contract, common counts, account stated, book account, quantum meruit, and fraud, and seeking economic and punitive damages. Clients cross-complained, alleging breach of fiduciary duty and slander of title regarding the trust deed, and seeking declaratory relief expunging the trust deed, reconveying their interest in the Idaho property, quieting their title thereto, and determining that the arbitration award barred attorneys claims. Clients sought economic and punitive damages.

The parties agreed that the court first would try their respective equitable claims, but, both below and on appeal, disputed whether that agreement included attorneys quantum meruit claim and whether attorneys waived their right to a jury trial of the quantum meruit claim. The case proceeded as a bench trial, including attorneys quantum meruit claim. The court found for clients on the breach of fiduciary duty and slander of title claims, awarding them $250,000 in economic and $300,000 in punitive damages. The court also ordered attorneys to reconvey their interest in the Idaho realty. Regarding attorneys quantum meruit claim, the court found that the value of attorneys legal services was approximately $45,000, ordered them to refund $40,000 previously paid to clients, and found that as a result attorneys other causes of action were moot because they were not entitled to any damages thereon. The court also found that the arbitration was binding and barred attorneys claims.

Attorneys appeal, contending that (I) the arbitration was not binding, and thus did not bar their lawsuit; (II) they were entitled to a jury trial on their contract and quantum meruit causes of action and did not waive that right; (III) the evidence was insufficient to support the finding that clients suffered any economic damages, and as a result they were not entitled to either economic or punitive damages; and (IV) the court lacked jurisdiction to affect the trust deed on realty located in Idaho. Attorneys also challenge many of the courts evidentiary rulings and claim the court displayed bias against them and preference for clients.

We agree with contentions (I) (III), but reject contention (IV). We reverse that portion of the judgment for clients on the amended complaint and remand for a new trial. We reverse that portion of the judgment for clients on the breach of fiduciary duty and slander of title claims in the cross-complaint and remand for the trial court to enter judgment for attorneys thereon. We affirm that portion of the judgment on the cross-complaint ordering attorneys to reconvey their interest in the Idaho realty. Because of these conclusions we do not address attorneys remaining contentions.^[1]

FACTS

On November 17, 1999, the parties executed a written retainer agreement (agreement). The agreement provided that attorneys would defend clients in the underlying litigation for a fee of $175 per hour plus costs, a rate the agreement described as being at the low end of the range for such services, but which was justified by an additional term that clients promised timely payment in full of all billed charges. As an incentive for clients to timely pay all bills in full, the agreement provided that any billed charges unpaid after 20 days would be subject to a 1.5 % monthly service charge. The agreement also contained a dispute resolution clause which stated: In the event of any dispute regarding either part[y]s performance under this agreement, both parties agree to submit said dispute to binding arbitration provided by the Los Angeles County Bar Association.

Sometime in November 1999, Howard and Etess discussed ways Howard might protect some of his and his companies assets, particularly several parcels of Idaho realty, from attachment should an adverse judgment be entered against clients. The discussion included the possibility of encumbering the Idaho realty to guarantee attorneys fees. Howard testified that Etess advised him to record a trust deed in attorneys favor to shelter his assets, but that attorneys would disclaim any interest in the property and would send Howard a letter so stating and promising to reconvey the property after the underlying litigation was concluded. Etess testified he did not so advise Howard and knew nothing about the deeds recordation before it occurred. On February 15, 2000, Howard recorded a deed of trust dated November 10, 1999 in attorneys favor to Secure [attorneys] fee agreement encumbering Idaho property owned by one of Howards companies. Thereafter, when clients requested that attorneys reconvey the trust deed, attorneys refused unless they received comparable fee guarantees.

In June 2000, clients replaced attorneys with their current counsel in the still-pending underlying litigation. On July 14, 2000, attorneys advised clients that they intended to file suit to collect their unpaid fees, that clients could seek arbitration as an alternative forum for resolution of the dispute, and that if clients chose arbitration, attorneys would agree to be bound by any arbitration award. On August 4, 2000, clients filed a petition for arbitration of the fee dispute pursuant to Business and Professions Code section 6200 et seq. but refused to agree that the arbitration would be binding. On May 3, 2002, attorneys withdrew their earlier offer to be bound by the arbitration award.

On July 9 and 10, 2002, after clients had secured a favorable judgment in the underlying litigation, a panel of three arbitrators conducted the arbitration. On July 11, 2002, apparently in response to a request by the arbitrators that the parties consider agreeing to make the arbitration binding, clients reaffirmed their refusal to do so. On October 8, 2002, a certified copy of the arbitrators STATEMENT OF DECISION AND AWARD was mailed to the parties. The statement of decision stated that attorneys claimed that the disputes provision in the agreement required clients to submit to binding arbitration, and that one of the issues before the arbitrators was whether that provision was valid and thus whether their decision and award were binding: [T]his arbitration provision compelling binding arbitration is a valid and enforceable part of the engagement agreement and as requested by [attorneys] this award and decision are therefore binding. (Italics added.) Although attorneys claimed entitlement to an additional $329,552.92 in fees, costs, and interest beyond the $85,000 clients already had paid, the panel concluded that the reasonable value of attorneys services and expenses was only $85,000, and thus that clients owed attorneys no additional money. The statement of decision explained: The fees charged for the services provided by [attorneys] were far in excess of what should have been charged for the work actually performed and properly billable . . . . [Attorneys] failed to provide . . . adequate and detailed invoices of fees and expenses and failed to carry the burden of establishing support for the claimed fees and costs. [Attorneys] took the incredible position of claiming their incurring sanctions for failure to comply with discovery orders was an intentional tactic engaged in to further the best interests of their client. The voluminous and disorganized evidence provided by [attorneys] does not support their claims to additional fees and costs of in excess of $275,000.00, nor is it possible to make a meaningful determination of the actual time incurred or costs incurred attributable to the underlying litigation in this matter.

Attorneys filed their original complaint on November 6, 2002 and their amended complaint on December 6, 2002. They alleged causes of action for breach of contract, common counts, account stated, book account, quantum meruit, and fraud. The fraud cause of action alleged that clients agreed to pay all bills in full but never intended to do so, and included a request for punitive damages. Clients cross-complained, alleging breach of fiduciary duty and slander of title in inducing them to record and refusing to cancel the deed of trust and seeking economic and punitive damages therefore; and seeking declaratory relief expunging the trust deed, reconveying attorneys interest in the Idaho property, quieting their title thereto, and finding that the arbitration award barred attorneys suit.

On October 8, 2003, the court denied clients summary judgment motion in which they argued that the arbitration award was binding and precluded attorneys claims. The court found a triable factual issue, whether, after the fee dispute arose, the parties agreed in writing that the arbitration would be binding. At trial, Howard testified that he thought the arbitration was binding because the contract called for binding arbitration, and because current counsel sent a letter to that effect after the arbitrators issued their award.

Attorneys demanded a jury trial and posted jury fees. At the March 25, 2004 status conference, the court set the case for a jury trial. On October 8, 2004, clients moved to bifurcate trial of the legal and equitable issues and to try the latter issues first. The motion identified the equitable issues as the cross-complaints declaratory relief, quiet title, and cancellation of cloud on title claims. The final status conference held on October 15, 2005, was not reported. The minutes state: Court will try this matter as a court trial as to the equitable issues.

On October 25, 2004, before trial began, attorneys informed the court that they were prepared to begin a bench trial on the equitable issues, but asserted that they were entitled to a jury trial on their quantum meruit claim, which they characterized as a damage claim. Clients counsel responded that his understanding of the parties agreement at the final status conference was that the court trial would include the attorneys quantum meruit cause of action as well as the clients declaratory relief claims. Attorneys replied that although the parties had discussed the possibility of agreeing that the quantum meruit claim would be included in the bench trial, no such agreement was reached. In response to the courts question, attorneys agreed that quantum meruit was an equitable theory. The court then ordered attorneys to begin their opening statement, stating, I am going to treat [sic] both issues, quantum mer[u]it and declaratory relief. Both parties gave opening statements. When the court ordered attorneys to call their first witness, this colloquy followed: [Rosenbaum]: I understand that the courts understanding was we would try both the quantum meruit and declaratory relief. . . . [W]e have no objection to the declaratory relief. However, . . .  [] The court: If you want, if you win on the declaratory relief, you win on quantum mer[u]it. If in fact they win on declaratory relief [] [Rosenbaum]: . . . [W]e have no objection to the declaratory relief, but I believe [] The court: . . . I am just telling you call your first witness right now. Attorneys did so without further objection.

Later, at a posttrial hearing to discuss the courts proposed statement of decision, attorneys challenged the statements assertion that they had waived jury trial. Attorneys again denied that they had agreed to a bench trial of their quantum meruit claim, on which they asserted they had a right to jury trial. In an extended colloquy, the court insisted that attorneys had agreed at the final status conference that the quantum meruit cause of action would be tried as a bench trial, and attorneys insisted that they had not so agreed. The court concluded by stating: Counsel, youre absolutely wrong. You came in here, both of you, and agreed that this was going to be a court trial. And we proceeded with a court trial.

Regarding the value of the Idaho realty, Howard testified that it significantly increased in value while encumbered by the deed of trust. Howard claimed, however, that had the title not been encumbered, he would have been able to sell the property and use the proceeds to buy more valuable real property, earning a greater return than the increase in the value of the property. Howards Idaho real estate broker testified that the parcel had appreciated in value, but speculat[ed] that Howard could have made an additional $250,000 had he sold the parcel sometime after the deed of trust was recorded, bought several smaller parcels with the proceeds and then sold the smaller parcels.

In its Statement of Decision the court stated it had tried the case as a bench trial, a jury having been expressly waived as to the specific causes of action before the Court[.] Despite the prohibition of Business and Professions Code sections 6200-6206 on predispute binding arbitration, the court determined that the arbitration award was binding because the parties agreed to binding arbitration in the agreement and Howard and the arbitrators believed it to be binding. The court found that the purpose of the deed of trust was to shelter clients assets, not to provide security for attorneys fees: The Court finds . . . Howards testimony to be credible on this issue. . . . Howard testified that he executed the deed on the advice of . . . [attorneys]. [Attorneys] told Howard that if he conveyed the real property to [attorneys], [they] would provide a private letter declaring that they did not in fact have an interest. After the [underlying] litigation, [attorneys] were to re-convey the asset in keeping with their advice that . . . Howard shelter his assets. [Attorneys] did not re-convey and in fact, never intended to re-convey unless [and] until [attorneys] had extorted an unconscionable amount of fees from Howard. The court ordered attorneys to reconvey their interest in the Idaho realty within 5 days of its signing the judgment and found that attorneys refusal to reconvey the deed of trust caused clients $250,000 in economic loss. Later, after finding Rosenbaums net worth to be $68,750 and Etess to be $1,568,750, the court assessed Rosenbaum $25,000 and Etess $275,000 in punitive damages.

DISCUSSION

Standard of Review

To the extent the case involves the courts determination of the reasonableness of attorney fees, we review such findings for abuse of discretion. (PLCM Group, Inc. v. Drexler (2000) 22 Cal.4th 1084, 1095.) We review the courts legal rulings, such as whether the arbitration was binding or attorneys waived their right to a jury trial, independently, particularly where they turn on undisputed facts. (Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799.) We review the courts factual findings, such as the amount of damages, for substantial evidence. (Bickel v. City of Piedmont (1997) 16 Cal.4th 1040, 1053.)

I. The Arbitration Award was Not Binding.

Attorneys contend that the court erred in determining that the arbitration clause in the agreement was enforceable and thus that the arbitration award was binding on the parties. We agree.

Although the agreement contained a binding arbitration dispute resolution clause, the parties instead chose to proceed with nonbinding arbitration pursuant to the Mandatory Fee Arbitration Act (MFAA) governing attorney client fee disputes pursuant to Business and Professions Code section 6200 et seq.^[2] Under the MFAA, [t]he parties may agree in writing to be bound by the award of arbitrators . . . at any time after the dispute over fees, costs, or both, has arisen. In the absence of such an agreement, either party shall be entitled to a trial after arbitration if sought within 30 days, pursuant to subdivisions (b) and (c) . . . . (Bus. & Prof. Code, 6204, subd. (a), italics added.) Although attorneys initially agreed to submit to binding arbitration under the MFAA if clients so agreed, clients refused to do so, expressly electing nonbinding MFAA arbitration.^[3] Before the arbitration hearing, attorneys withdrew their agreement to be bound, and thus both parties elected nonbinding MFAA arbitration. After the hearing but before the award, clients reaffirmed that the arbitration would be nonbinding. Where, as here, the parties elect nonbinding arbitration under the MFAA, and participate in the arbitration pursuant to it, and do not waive their rights under the MFAA by failing to adhere to any of its provisions, the parties retain the right to litigate the dispute thereafter so long as they follow statutory time requirements. (Aguilar v. Lerner, supra. 32 Cal.4th at pp. 983-990; Ervin, Cohen & Jessup, LLP v. Kassel, supra, 147 Cal.App.4th at pp. 826-829; Alternative Systems, Inc. v. Carey (1998) 67 Cal.App.4th 1034, 1041-1044.)^[4] The arbitrators and court erred in concluding otherwise.

Clients argue that Business and Professions Code section 6204, subdivisions (b) and (c), required attorneys to petition the court to vacate or overturn the arbitration award and that by failing to do so attorneys have waived their right to bring an independent action for fees and costs. We disagree. An arbitration award pursuant to the above code section becomes final and binding absent such a petition only if a related civil action is pending at the time of the award. (Bus. & Prof. Code, 6204, subd. (b).) Where, as here, no action is pending, the trial after arbitration shall be initiated by the commencement of an action . . . within 30 days after mailing of notice of the award. (Bus. & Prof. Code, 6204, subd. (c).) Attorneys filed their complaint on November 6, 2002, within 30 days after the October 8, 2002, mailing of the certified copy of the award.

II. Attorneys Did Not Waive Their Right to a Jury Trial.

Attorneys contend that they did not waive their right to a jury trial. They argue that such a waiver must be expressly recorded in the minutes, and there was no such recording here. Clients argue that attorneys contractual agreement to binding arbitration constituted a valid implied jury waiver, the courts finding that attorneys waived their right to a jury is supported by substantial evidence, and the courts findings in the bench trial obviated the need for a jury trial. We agree with attorneys.

In actions for . . . money claimed as due upon contract, or as damages for breach of contract, or for injuries, an issue of fact must be tried by a jury, unless a jury trial is waived . . . as provided in this Code. (Code Civ. Proc., 592.) Clients do not contend, nor did the court find, that attorneys did not have a right to trial by jury under this section for their contract, quantum meruit, and fraud causes of action. Because neither the court nor clients asserted that attorneys lacked a jury trial right on their quantum meruit claim, and clients do not so contend on appeal, we do not address this issue.

Article I, section 16 of the California Constitution provides: In a civil cause a jury may be waived by the consent of the parties expressed as provided by statute. Code of Civil Procedure section 631, subdivision (a) provides: In civil cases, a jury may only be waived pursuant to subdivision (d). Subdivision (d) provides that a jury may be waived by failing (1) to appear for trial, (2) to announce that a jury is required, at the time the cause is first set for trial, or (3) timely to post jury fees, none of which occurred here; it also provides that a jury may be waived by written consent filed with the clerk or judge[,] or by oral consent, in open court, entered in the minutes. (Id., 631, subds. (d)(2), (d)(3).) [T]he right to trial by jury is considered so fundamental that ambiguity in the statute permitting such waivers must be be resolved in favor of according to a litigant a jury trial. [Citation.] Similarly, . . . the right to trial by jury is so important that it must be zealously guarded in the face of a claimed waiver [citation]. . . . [Code of Civil Procedure] section 631 . . . provid[es] strict and exclusive requirements for waiver of jury trial [citation] and require[es] courts to resolve doubts in interpreting the waiver provisions of [Code of Civil Procedure] section 631 in favor of a litigants right to jury trial. [Citation.] (Grafton Partners v. Superior Court (2005) 36 Cal.4th 944, 956.)

First, we reject clients argument that the contractual binding arbitration clause constituted a valid implied jury waiver. As discussed in section I, such provisions generally are enforceable because parties may contract before disputes arise and before any court action is filed to resolve disputes through arbitration, thereby waiving their rights to use the court system at all, including their right to a jury trial. Agreements to arbitrate do not violate Code of Civil Procedure section 631, which applies to jury waivers only after an action has been filed. (Madden v. Kaiser Foundation Hospitals (1976) 17 Cal.3d 699, 702-703, 712-715.) Such predispute, preaction agreements, however, whether they provide only for binding arbitration or include express waivers of jury trial, cannot constitute a jury waiver in a later civil action, where such waivers can be made only as expressly permitted under section 631. (Grafton Partners v. Superior Court, supra, 36 Cal.4th at pp. 955, 957-961.) Thus, as here, once an action is pending, a jury can be waived only as expressly permitted by Code of Civil Procedure section 631; no preaction jury waiver, particularly not a general binding arbitration clause, is a valid jury waiver in a later-filed case.^[5]

Second, we reject clients argument that attorneys waived their right to a jury after the case was filed. Attorneys never waived their jury trial right, either orally in open court entered in the minutes, or in a writing filed with the judge or clerk. Nor did attorneys proceeding in the face of the courts order to call their first witness constitute the required waiver. Attorneys jury trial right may not be waived by implication, but only affirmatively and in the manner designated by Code of Civil Procedure section 631. [Citation.] The illegal denial of a jury where jury trial has not been waived would constitute cause to reverse any judgment. [Citation.] (Byram v. Superior Court (1977) 74 Cal.App.3d 648, 654.)

Clients contend that the courts resolution of the issues litigated in the bench trial, specifically its findings that the arbitration award was binding and the deed of trust was invalid, mooted attorneys entire case. The fallacies in the argument are two: first, it assumes that the courts decision regarding arbitration was correct, which it was not; second, it assumes that the courts decision regarding the deed of trust necessarily encompassed a determination of the value of the services, which it did not. Thus, we reverse that portion of the judgment for clients on attorneys amended complaint and remand for a new trial thereon.

III. Substantial Evidence Does Not Support the Courts
Economic and Punitive Damages Awards on Clients
Breach of Duty and Slander of Title Claims.

Attorneys raise a number of challenges to the courts findings for clients on their breach of fiduciary duty and slander of title claims. Because we agree with attorneys that as a matter of law clients evidence of economic damages was speculative and that punitive damages cannot be awarded in the absence of economic damages, we do not discuss their other claims of error. As a result, we reverse that portion of the judgment on clients breach of fiduciary duty and slander of title claims and remand for the court to enter judgment for attorneys thereon.^[6]

In an action for wrongful disparagement of title, a plaintiff may recover . . . financial loss resulting from the impairment of vendibility of the property . . . . A plaintiff may not recover damages for . . . the loss of advantageous use of the money which would have been realized from the sale of the property. [Citations.] (Seeley v. Seymour (1987) 190 Cal.App.3d 844, 865.) Damages for loss of use of sale proceeds . . . are not permitted because they are too speculative, since they depend upon the particular situation of the disappointed vendor and the varied possibilities as to what use the money might have been put. [Citation.] (Ibid.) Here, all of clients purported damages constituted such a loss. Both Howard and clients broker testified that the property appreciated in value during the time the deed of trust prevented its sale. As the broker himself admitted, however, the claim that clients would have made even more money had they sold the lot, bought smaller lots, and then resold them, is speculative. We also reject clients contrary argument that they can recover for such lost investment opportunities on their breach of fiduciary duty claim. None of the cases upon which they rely support this contention. Because clients presented no evidence that they suffered recoverable economic damages, the punitive damages award also must be reversed. [I]t is settled in California that punitive damages cannot be awarded unless actual damages were suffered . . . . [Citations.] (6 Witkin, Summary of Cal. Law (10th ed. 2005) Torts, 1607, p. 1111; Continental Ins. Co. v. Superior Court (1995) 37 Cal.App.4th 69, 86.)

IV. The Court Properly Ordered Attorneys to Reconvey
Their Interest in the Idaho Realty.

Attorneys contend that the court erred in ordering them to reconvey their interest in the Idaho property because substantial evidence does not support the courts interpretation of the parties agreement regarding reconveyance and because the court had no jurisdiction to make an order affecting title to out-of-state realty. We disagree.

As to the substantial evidence challenge, we defer to the trier of fact on issues of credibility. [N]either conflicts in the evidence nor testimony which is subject to justifiable suspicion . . . justif[ies] the reversal of a judgment, for it is the exclusive province of the [trier of fact] to determine the credibility of a witness and the truth or falsity of the facts upon which a determination depends. (Lenk v. Total-Western, Inc. (2001) 89 Cal.App.4th 959, 968, internal quotations and citations omitted.) The testimony of a single witness, even a party, is sufficient if believed by the factfinder. (In re Marriage of Mix (1975) 14 Cal.3d 604, 614.) In reviewing the courts findings, we cannot reweigh the evidence. (Howard v. Owens Corning (1999) 72 Cal.App.4th 621, 630-631.)^[7]

Here, the court credited Howards testimony that the parties had agreed that, although the Deed of Trust stated that it was to guarantee attorneys fees, the attorneys renounced any such interest. They further agreed that attorneys would provide clients a letter renouncing any interest in the property and agreeing to reconvey it after the underlying litigation was concluded. The court found that attorneys breached this agreement by not reconveying the property upon clients demand after the underlying litigation ended and ordered attorneys to reconvey the property pursuant to this agreement. Attorneys only challenge to the courts authority to make such an order is that the court lacked jurisdiction to quiet title to out-of-state real property. The court, however, did not quiet title to any real property; rather, it simply ordered attorneys to comply with the terms of their agreement to reconvey their interest in the property to clients. Because we must defer to the courts credibility findings, we need not address attorneys claims that their acts in connection with the trust deed did not violate State Bar rules, an issue which is irrelevant to whether attorneys breached their agreement to reconvey the property.^[8]

DISPOSITION

That portion of the judgment for clients on attorneys amended complaint is reversed and the case is remanded for a new trial thereon. That portion of the judgment for clients on their breach of fiduciary duty and slander of title claims in the cross-complaint is reversed and the case is remanded for the court to enter judgment for attorneys thereon. That portion of the judgment on the cross-complaint ordering attorneys to reconvey all their interest in the Idaho realty to clients is affirmed. The parties shall bear their own costs on this appeal.

NOT TO BE PUBLISHED.

ROTHSCHILD, J.

We concur:

MALLANO, Acting P.J. VOGEL J.

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Analysis and review provided by Chula Vista Property line attorney.

^[1] We deny attorneys renewed motion for judicial notice raised in their reply brief.

^[2] Had the parties not chosen to proceed under the MFAA, or, having done so, failed to comply with its requirements, either party could have sought to compel binding arbitration pursuant to the contractual binding arbitration clause. (Code Civ. Proc., 1280 et seq.; Aguilar v. Lerner (2004) 32 Cal.4th 974, 979, 983-990; Ervin, Cohen & Jessup, LLP v. Kassel (2007) 147 Cal.App.4th 821, 823-824, 826-829.)

^[3] We reject clients argument that they never chose nonbinding MFAA arbitration. Clients expressly requested nonbinding MFAA arbitration in writing before the hearing and did so again after the hearing but before the arbitrators announced their award. We reject their suggestion, unsupported by any authority, that their counsel lacked authority to so agree and that only Howard personally could do so, despite his being represented by counsel. Moreover, Howards self-serving testimony on this point that, despite his attorneys having expressly elected nonbinding arbitration, he thought the arbitration would be binding because of the contractual binding arbitration clause, cannot negate his express written refusal, both before and after the arbitration hearing, to be bound by the award.

^[4] The Supreme Court has granted review in a case which held that the MFAA voided binding arbitration clauses in attorney-client fee agreements. (Schatz v. Allen Matkins Leck Gamble & Mallory LLP (2007) 146 Cal.App.4th 674, 679-686, rev. granted May 9, 2007, S150371; cf. Alternative Systems, Inc. v. Carey, supra, 67 Cal.App.4th at pp. 1041-1044.) Because in our case the parties chose and completed nonbinding MFAA arbitration, and never sought an order compelling arbitration pursuant to Code of Civil Procedure section 1280 et seq., resolution of this issue will not affect our holding.

^[5] Clients citation of Grafton for precisely the opposite proposition, that general contractual binding arbitration clauses do constitute effective jury waivers in later civil actions, is inaccurate at best and misleading at worst.

^[6] Our holding that, as a matter of law, clients failed to present substantial evidence of damages equates to a holding that attorneys were entitled to judgment notwithstanding the verdict on clients slander of title and breach of fiduciary duty claims. Neither in their brief nor at oral argument did clients describe any other damages they could prove at a retrial. (McCoy v. Hearst Corp. (1991) 227 Cal.App.3d 1657, 1659-1663.)

^[7] Nothing about the manner in which Howard presented his testimony undermines the courts credibility finding. We reject attorneys argument that the court erred in its conduct of the proceedings, or that, if it did, any such error tainted its credibility finding.

^[8] Neither party contends that this agreement or the recordation of the deed of trust adversely impacted any third party.