Alkadri v. May

Filed 8/28/07 Alkadri v. May CA1/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION ONE

In this action for legal malpractice and breach of fiduciary duty, appellant Mohamed Alkadri appeals from the judgment of dismissal entered after the trial court sustained without leave to amend the demurrer of respondent John S. May on the ground that the action was barred by the statute of limitations. We affirm.

ALLEGATIONS OF THE COMPLAINT AND PROCEDURAL BACKGROUND

On October 31, 2005, appellant, acting in pro per, filed a complaint against respondent alleging causes of action for negligence, breach of fiduciary duty, breach of contract, and fraud. The essence of the complaint is that respondent, an attorney, engaged in adverse representation against appellant, a former client. Appellant subsequently retained an attorney, who filed a first amended complaint for legal malpractice and breach of fiduciary duty on February 16, 2006.

On March 10, 2006, respondent filed a demurrer to the first amended complaint, alleging that the two causes of action were barred by the one-year statute of limitations under Code of Civil Procedure section 340.6 (section 340.6). The court sustained the demurrer with leave to amend on May 5, 2006.

The following factual allegations are taken from appellants second amended complaint (SAC). Appellant consulted with respondent in March 1997 for the purposes of retaining him to represent him in his divorce. During this time, appellant revealed confidential information to respondent concerning matters relevant to his divorce. He ultimately retained a different attorney, and the divorce became final in February 2000.

In July 2003 appellants ex-wife retained respondent to represent her in a custody dispute concerning appellants daughter. In September 2003, respondent filed an order to show cause seeking to hold appellant in contempt for violating certain ex parte orders.

In October 2003, appellant filed an objection to respondents attempt to place his name on the U.S. State Departments Passport Lookout Database. He claimed in his moving papers that respondent held a grudge against him because he interviewed him in 1997 as a potential lawyer to represent him in his divorce and did not hire him. Respondent filed a declaration in reply, stating that he had no recollection of ever interviewing appellant and that appellant had never been his client.

At the December 2003 hearing on the contempt matter, appellant invoked his Fifth Amendment rights because he did not want to be cross-examined by attorney Defendant May who possessed sensitive, confidential information he learned from Plaintiff concerning his ex-wife, his daughter and his father. We note that the first amended complaint contains the same allegation, except that it refers to respondent as appellants former attorney.

In March 2004, the court found appellant in contempt and, in February 2005, sentenced him to 10 days in jail, suspended the sentence, and placed him on probation for two years.

In November 2004, appellant objected to respondents efforts to take his deposition and asked him to withdraw from the case based on their prior relationship. Respondent then executed a declaration admitting that he had interviewed appellant in March 1997 but arguing that this fact did not constitute grounds for disqualification. In December 2004, the court found that respondents representation of appellants ex-wife was an impermissible representation of adverse interests and disqualified respondent.[1]

On May 23, 2006, respondent filed his demurrer to the SAC, again alleging that the causes of action were barred by the statute of limitations.

On August 14, 2006, the trial court issued its order sustaining respondents demurrer to the SAC without leave to amend. The court found that the complaint showed appellant was aware in 1997 that he had consulted with respondent, and that he knew in 2003 that respondent was representing his ex-wife. The court determined that the statute of limitations commenced to run no later than March 12, 2004, the date that the trial court in the family law matter sustained two counts of contempt against him.

The trial court further found that the tolling provision of section 340.6, subdivision (a)(3), does not apply to extend the one-year statute of limitations for legal malpractice, which begins running when a plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission. ( 340.6, subd. (a).) The court also entered various rulings regarding objections to respondents requests for judicial notice, noting that it did not need to take judicial notice of any of the requested matters in order to sustain the demurrer without leave to amend.

Judgment in favor of respondent was filed on September 15, 2006. This appeal followed.

DISCUSSION

I. Standard of Review

On appeal from a judgment of dismissal after a demurrer is sustained without leave to amend, the reviewing court assumes the truth of all facts properly pleaded by the plaintiff. (Evans v. City of Berkeley (2006) 38 Cal.4th 1, 6; Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081; Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) We also accept as true all facts that may be implied or reasonably inferred from those expressly alleged. (Marshall v. Gibson, Dunn & Crutcher (1995) 37 Cal.App.4th 1397, 1403.) We do not assume the truth of   contentions, deductions or conclusions of fact or law.   (Evans v. City of Berkeley, supra, at p. 6.) But relevant matters that are properly the subject of judicial notice may be treated as having been pleaded. (Ibid.; Schifando v. City of Los Angeles, supra, at p. 1081.) We review the trial courts action de novo and exercise our own independent judgment whether a cause of action has been stated under any legal theory. (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 125.)

II. Statute of Limitations for Legal Malpractice

A demurrer on the ground of the bar of the statute of limitations will not lie where the action may be, but is not necessarily barred. [Citations.] It must appear clearly and affirmatively that, upon the face of the complaint, the right of action is necessarily barred. [Citations.] This will not be the case unless the complaint alleges every fact which the defendant would be required to prove if he were to plead the bar of the applicable statute of limitation as an affirmative defense. (Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 881.)

Section 340.6, subdivision (a), provides in part, that [a]n action against an attorney for a wrongful act or omission . . . arising in the performance of professional services shall be commenced within one year after the plaintiff discovers, or through the use of reasonable diligence should have discovered, the facts constituting the wrongful act or omission, or four years from the date of the wrongful act or omission, whichever occurs first. In no event shall the time for commencement of legal action exceed four years except that the period shall be tolled during the time that any of the following exist: [] . . . [] (3) The attorney willfully conceals the facts constituting the wrongful act or omission when such facts are known to the attorney, except that this subdivision shall toll only the four-year limitation . . . . (Italics added.) This subdivision thus contemplates two limitation periods: A one-year period that commences from the date that the plaintiff discovers or should have discovered the facts constituting the wrongful act or omission, and a four-year period that commences from the actual date of the wrongful act or omission. The tolling provision provided for in section 340.6, subdivision (a)(3), applies to the four-year period only.

1. The One-Year Statute of Limitations Bars Appellants Claims

Appellant asserts that his causes of action are not barred by the one-year statute of limitations in section 340.6 because he pled belated discovery and concealment-based tolling. He further asserts these issues are questions of fact that cannot be resolved on demurrer. We disagree.

The question of when there has been a belated discovery of the cause of action, especially in malpractice cases, is ordinarily a question of fact. It is only where reasonable minds can draw but one conclusion from the evidence, that it becomes a matter of law. (Johnson v. Haberman & Kassoy (1988) 201 Cal.App.3d 1468, 1476.) In this case, we conclude as a matter of law that appellants causes of action accrued no later than March 2004.

Preliminarily, we believe, as did the trial court below, that the one-year statute applies. That is, appellant was required to file his claim within one year from the date on which he discovered or should have discovered the facts constituting the wrongful act. With respect to constructive knowledge, The ultimate question . . . is whether plaintiff through the use of reasonable diligence should have discovered those facts more than one year before he filed his malpractice action. The answer depends on whether he had notice of circumstances sufficient to put a reasonable person on inquiry or had the opportunity to obtain knowledge from sources open to his investigation. (Baright v. Willis (1984) 151 Cal.App.3d 303, 312.)

Appellant makes much of his alleged reliance on the fact that respondent denied in October 2003 that he had ever represented appellant. We believe, however, that appellants claim did not depend on whether respondent chose to deny or affirm the relationship. Once they are on notice of a wrongful act, plaintiffs must bring their claims in a timely manner regardless of whether the defendants admit to the facts that may subject them to liability: It is well settled that the one-year limitations period of section 340.6  is triggered by the clients discovery of the facts constituting the wrongful act or omission, not by his discovery that such facts constitute professional negligence, i.e., by discovery that a particular legal theory is applicable based on the known facts. It is irrelevant that the plaintiff is ignorant of his legal remedy or the legal theories underlying his cause of action.  [Citation.] [Citations.] (Peregrine Funding, Inc. v. Sheppard Mullin Richter & Hampton LLP (2005) 133 Cal.App.4th 658, 685.)

Here, appellants SAC establishes that he personally consulted with respondent in 1997 and that they discussed matters pertaining to the dissolution of his marriage. He knew that respondent subsequently undertook to represent his ex-wife. He knew that respondent possessed confidential information about him, which led him to invoke the Fifth Amendment during the contempt proceedings in December 2003. Thus, the SAC establishes that, no later than the finding of contempt in March 2004, appellant had notice of sufficient facts to put a reasonable person in appellants position on inquiry regarding a potential cause of action for legal malpractice based on adverse representation. (See Laird v. Blacker (1992) 2 Cal.4th 606, 615 [[U]nder section 340.6, the statute of limitations for legal malpractice actions commences on entry of adverse judgment].)

Appellants reliance on Neel v. Magana, Olney, Levy, Cathcart & Gelfand (1971) 6 Cal.3d 176 (Neel) does not alter our analysis. The court in Neel held that in an action for malpractice against an attorney, the cause of action does not accrue until the plaintiff knows, or should know, all material facts essential to show the elements of that cause of action. (Id. at p. 190.) The Legislature adopted this holding when it subsequently enacted section 340.6. (See Laird v. Blacker, supra, 2 Cal.4th 606, 611.)

This is not a case where a reasonable person in appellants position would fail to recognize negligence when he sees it or would lack any opportunity to see it. (Neel, supra, 6 Cal.3d 176, 188.) Appellant reasonably should have recognized the wrongfulness of respondents conduct when he chose to exercise his Fifth Amendment rights during the contempt proceeding. He also had the opportunity to perceive the harm caused by respondents wrongful conduct because he personally experienced its effects during this same proceeding.

In support of his claim of delayed discovery, appellant states that if he had known of the relationship he would have objected to Mays cross-examination of him in December 2003 on the grounds of attorney-client privilege and informed [the trial court] of the relationship. Yet in his first amended complaint, appellant states that he invoked the Fifth Amendment because he did not want to be cross-examined by his former attorney. The court below was entitled to consider this allegation, notwithstanding the fact that the SAC omits the reference to former attorney.[2] In any event, appellants subjective claims of ignorance do not defeat the statute of limitations because the statutes application is not limited to a plaintiffs subjective awareness of his cause of action.

Similarly, appellants self-serving allegation that he did not know and could not have known that respondents representation of his ex-wife was wrongful conduct is a conclusion of law that we need not assume to be true. (See Evans v. City of Berkeley, supra, 38 Cal.4th 1, 6.) In sum, the statute of limitations expired in March 2005, some seven months before the initial complaint in this lawsuit was filed. Accordingly, we conclude that the judgment of dismissal must be affirmed.

2. Section 340.6, subdivision (a)(3), Does Not Apply

Appellant also argues that the four-year statute of limitations was tolled by respondents concealment. We find this argument unavailing.

The tolling provision of section 340.6, subdivision (a)(3), manifestly does not apply to appellants allegation that respondent concealed his wrongful conduct until November 2004 because, by its terms, that tolling provision only applies to extend the four-year period (commencing from date of the wrongful act or omission) as opposed to the one-year period (commencing from actual or constructive notice of the wrongful act or omission). Accordingly, the tolling provision is not relevant to appellants claims because, if the four-year statute applied, his complaint would have been proper as it was filed in October 2005, well within four years of the date on which respondent first undertook to represent appellants ex-wife. As we have already concluded that the one-year statute of limitations applies to bar appellants claims, there is no need to consider the application of this tolling provision.

DISPOSITION

The judgment is affirmed.

Publication Courtesy of San Diego County Legal Resource Directory.

Analysis and review provided by San Diego County Property line attorney.

[1] An attorney may not undertake or continue a representation adverse to a former client when the attorney has, because of his prior representation of the former client, obtained confidential information material to the new representation. [Citation.] The rule seeks to protect the confidential attorney-client relationship by barring the attorney from acting in a new matter substantially related to the prior representation. (Shandralina G. v. Homonchuk (2007) 147 Cal.App.4th 395, 406407; see also Rules Prof. Conduct, rule 3-310(E).)

[2]  Generally, after an amended pleading has been filed, courts will disregard the original pleading. [Citation.] [] However, an exception to this rule is found . . . where an amended complaint attempts to avoid defects set forth in a prior complaint by ignoring them. The court may examine the prior complaint to ascertain whether the amended complaint is merely a sham. [Citation.] The rationale for this rule is obvious. A pleader may not attempt to breathe life into a complaint by omitting relevant facts which made his previous complaint defective. [Citation.] Moreover, any inconsistencies with prior pleadings must be explained; if the pleader fails to do so, the court may disregard the inconsistent allegations. [Citation.] Accordingly, a court is not bound to accept as true allegations contrary to factual allegations in former pleading in the same case. [Citation.] (Vallejo Development Co. v. Beck Development Co. (1994) 24 Cal.App.4th 929, 946.)