Howard v. Dolan

Filed 3/9/07 Howard v. Dolan CA1/5

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

Plaintiff and appellant Kenneth J. Howard appeals a judgment after a bench trial in favor of his former employer, defendant and respondent Christopher B. Dolan. Appellant argues the trial court erred in concluding respondent did not engage in unfair business practices pursuant to Business and Professions Code section 17200. He further contends the court erred in finding the evidence insufficient for his fraud cause of action. We disagree and affirm.

Background

Appellant began working as a legal assistant at respondents law office (the Dolan law firm) in January 2002. He worked there for 15 months until he resigned at the end of March 2003. The Dolan law firm specializes in personal injury and employment law and appellant was hired to assist with the personal injury side of the business. Appellants starting salary at the Dolan law firm was $30,000 and he was paid on an hourly basis, for a 40 hour week.

Appellant requested a meeting with respondent which took place on August 28, 2002. Appellant testified the purpose of the meeting was to discuss his compensation, workload, stress level, and staffing issues. Only appellant and respondent were present at the meeting. A series of e‑mails followed the conclusion of the meeting. Appellant wrote to respondent: Chris: [] Pursuant to our conversation of this afternoon, I verify our agreement that as of September 2, 2002, I will become a salaried employee at the rate of $40,000.00 per year, while being still eligible for company bonuses. My work hours will be 8:30 a.m. to 5:30 p.m., with no overtime, performing all necessary job tasks and projects within that time frame. [] In January of 2004, we will address my work performance subsequent to a goal of my salary being raised to $45,000.00 per year. I relinquish the previously agreed upon review meeting in January, 2003. [] Kenneth J. Howard. Respondent replied, Ken this is correct. Please confirm that you are stating that you can get your job tasks fulfilled in this time frame without overtime being incurred as that is my understanding. Please confirm that as I do not want to give the impression that I am violating any rights to overtime payment that may exist if any but, instead, you are indicating that you can accomplish your tasks without incurring overtime. Appellant verified I confirm that I am stating that I can get my job tasks fulfilled in this time frame without overtime. I also confirm that you are not, in any way, violating my rights to overtime payment that may exist. I am indicating that within the agreed upon time frame I can accomplish my required job tasks.

Appellant continued working for the Dolan law firm until March 27, 2003. Prior to his last day, appellant exchanged e‑mails with respondent and Zack Lyons, respondents personal assistant, regarding his final days and final paycheck. The parties came to the agreement that appellants last day would be Thursday, March 27, 2003, but appellant asked to be paid for the last two days in March because he had worked enough unpaid overtime to cover those days. Respondent stated he was not aware of any overtime to cover the extra days, but he would agree to appellants request if appellant accepted it as full and final payment of his wages, including any overtime. Appellant agreed, but restated his contention that he had in fact been working overtime.

After his resignation, appellant brought suit against respondent. In his first amended complaint, appellant alleged numerous violations of the Labor Code that would entitle him to statutory fees, penalties, and attorney fees. He also alleged a cause of action for fraud. Appellant then alleged that the Labor Code violations and the fraud constituted unfair business practices under Business and Professions Code section 17200.^[1]

The trial court bifurcated the proceedings and began a nonjury trial on the equitable issues, which primarily consisted of appellants Business and Professions Code section 17200 cause of action. Following that trial, the court issued a tentative statement of decision on June 1, 2005. The court stated the decision would become final unless either party complied with the requirements of Code of Civil Procedure section 632;^[2]neither party did so. The court also invited the parties to submit additional briefs on the subject of whether any issues still remained to be determined by a jury, and if so, which issues. Neither party filed such briefs. On June 29, 2005, the court issued its statement of decision. Judgment was entered on July 22, 2005 in conformity with the statement of decision.

The trial court rejected appellants Business and Professions Code section 17200 claim, and concluded that, with two exceptions, respondent had not committed the alleged Labor Code violations. Specifically, the court found there was insufficient evidence to prove that appellant: (1) worked overtime hours for which he was not compensated; (2) was denied breaks or lunch periods; (3) worked makeup time for which he was not properly compensated; (4) was required to enter into an unlawful agreement regarding employment terms and conditions; or (5) entered into an unlawful release. The court did find that proper check stubs had not been prepared by respondent and mandatory time records were missing. However, the court found that neither of these improprieties resulted in injury to appellant. As to the fraud claim, the court found the evidence did not establish an intentional misrepresentation or concealment by respondent. Based on these conclusions, the court found no basis for appellants claim of unfair business practices in violation of section 17200.

The court concluded the judgment by stating: As a consequence of failure by the parties to submit additional briefs on the issue of whether there remained any issues to be determined by a jury, or to seek to challenge or modify the courts statement of decision, or to pursue the opportunity for a jury trial on any remaining issues, the courts decision is deemed to have resolved those issues accordingly. Therefore the court determines that no additional matters remain to be determined by jury trial. This appeal followed.

Discussion

On appeal, appellant contends the court erred in rejecting his Business and Professions Code section 17200 claim because the courts own findings in the statement of decision substantiate certain Labor Code section violations as well as the fraud claim. After discussing the standard of review, we set forth the requirements for a section 17200 claim and then examine the courts rulings on each of the alleged unfair business practices.

I. Standard of Review

The substantial evidence standard applies to both express and implied findings of fact made by the superior court in its statement of decision rendered after a nonjury trial. [Citation.] The doctrine of implied findings is based on our Supreme Courts statutory construction of [Code of Civil Procedure] section 634 and provides that a party must state any objection to the statement in order to avoid an implied finding on appeal in favor of the prevailing party. . . . [I]f a party does not bring such deficiencies to the trial courts attention, that party waives the right to claim on appeal that the statement was deficient . . . and hence the appellate court will imply findings to support the judgment. [Citation.]^[3] (SFPP v. Burlington Northern & Santa Fe Ry. Co. (2004) 121 Cal.App.4th 452, 462.) Where, as here, the statement of decision sets forth the factual and legal basis for the decision, we resolve any conflict in the evidence or reasonable inferences to be drawn from the facts in support of the trial courts decision. (In re Marriage of Hoffmeister (1987) 191 Cal.App.3d 351, 358.)

II. Business and Professions Code Section 17200 et seq.^[4]

Business and Professions Code section 17200 expresses California public policy against unfair competition, and prohibits wrongful business conduct in whatever context such activity might occur. [Citation.] Section 17200 defines unfair competition as, inter alia, any unlawful, unfair or fraudulent business practice. The unlawful practices prohibited by section 17200 are any practices forbidden by law, be it civil or criminal, federal, state, or municipal, statutory, regulatory, or court-made. [Citation.] . . .  [Citation.] (Application Group, Inc. v. Hunter Group, Inc. (1998) 61 Cal.App.4th 881, 906-907.) California courts have recognized that an employers business practices concerning its employees are within the scope of section 17200. [Citations.] For example, where the employers policy or practice is forbidden by or found to violate the Labor Code, it may also be held to constitute an unlawful business practice subject to redress under the [Unfair Practices Act]. [Citations.] (Id. at p. 907.)

Business and Professions Code section 17204 was approved by the electorate in 2004 as part of Proposition 64 and provides: Actions for any relief pursuant to this chapter shall be prosecuted exclusively . . . by any person who has suffered injury in fact and has lost money or property as a result of such unfair competition. (Italics added.) Previously, section 17204 (Stats. 1993, ch. 926,  2, p. 5198) authorized  any person acting for the interests of itself, its members or the general public [citation] to file a civil action for relief. Standing to bring such an action did not depend on a showing of injury or damage. (Californians for Disability Rights v. Mervyns LLC (2006) 39 Cal.4th 223, 228.) In Californians, our Supreme Court held the new provisions [of Proposition 64] apply to pending cases. (Californians,at p. 227.)

III. Analysis of the Trial Courts Rulings on Each Alleged Unfair Business Practice

First, as to certain Labor Code sections, the trial court found that the evidence was insufficient to demonstrate any statutory violations by respondent. We review these rulings for substantial evidence to support the finding that no violation took place. Next, where the trial court findings suggested a violation may have occurred, but appellant suffered no injury, we review the findings of no injury. We then review the trial courts conclusion that the evidence failed to substantiate appellants fraud cause of action. Finally, we address appellants claim of error regarding two pieces of evidence.

A. Labor Code Sections 226.7 and 512Meal and Rest Periods

Labor Code section 512, subdivision (a) provides, in relevant part: An employer may not employ an employee for a work period of more than five hours per day without providing the employee with a meal period of not less than 30 minutes, except that if the total work period per day of the employee is no more than six hours, the meal period may be waived by mutual consent of both the employer and employee.

Labor Code section 226.7 provides: (a) No employer shall require any employee to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission [(IWC)]. [] (b) If an employer fails to provide an employee a meal period or rest period in accordance with an applicable order of the [IWC], the employer shall pay the employee one additional hour of pay at the employees regular rate of compensation for each work day that the meal or rest period is not provided.^[5]

Here, the trial court stated [t]here was insufficient evidence to meet [appellants] burden of proof that [appellant] was denied breaks or lunch periods as provided by law or that he was suffered or permitted to work through these periods and therefore entitled to overtime compensation or other compensation for not receiving breaks or lunches. Substantial evidence supported the conclusion that Labor Code sections 226.7 and 512 were not violated.

As an initial matter, respondent argues appellant waived his right to pre-August 2002 damages for pre-August 2002 breaks. At trial, during redirect examination, appellants counsel asked appellant are you claiming overtime compensation prior to August 28, 2002, for dates in which you indicated that you started time [sic] at 8:30 in the morning? Appellant replied, No. Later during trial, respondent read a portion of appellants deposition of June 30, 2004, into the record as follows:

[Appellants counsel]: Im going to object to this document. Weve asked for overtime in breaks post-August 28, 2002. The date on this . . . [i]s May 13 -- Im objecting on the record to this document.

[Respondent]: May 13, 2002.

[Appellants counsel]: 2002, thats outside the scope.

[Respondent]: Of what?

[Appellants counsel]: For which we are seeking damages.

[Respondent]: Youre not seeking damages prior to August of 2002?

[Appellants counsel]: No, we are not. Please read the complaint.

Despite this record, appellant argues that there was no waiver of his right to recover compensation for pre-August 2002 meal and rest periods because the statement of decision did not explicitly state there had been a waiver. Appellant cites no authority and we are aware of none that requires the court to make such an express finding in its statement of decision. In fact, the doctrine of implied findings discussed in part I., ante, is to the contrary. Though the court discussed appellants pre-August 2002 work schedule in its statement of decision, this could reflect that such conduct was evidence of habit, admissible to prove, for example, the hours worked by appellant after August 2002.

In any event, even if appellant did not waive his right to recover additional compensation for missed meals or rest periods prior to August 2002, there is substantial evidence that appellant failed to prove he was denied lunches or rest periods for any period of time during his employment.^[6]

Appellant testified that respondent informed him he was permitted to take a morning break and an afternoon break, and that he was permitted a lunch break that should be concluded by 2:00 p.m. Joshua Brandon, another employee of the Dolan law firm testified that respondent frequently reminded employees of their rights to take lunches and breaks. Appellant testified that he created a sign stating The Troll is Out that he would only put up on his cubicle when he was taking a break or lunch. He explained, I made it very clear if I put out The Troll is Out, dont bother me. Appellant also admitted to organizing lunches for himself and others, an admission substantiated by e‑mails received into evidence illustrating his coordination of various lunch orders. In these e‑mails, appellant referred to himself as Barbeque Boy and Elf Rib Boy. Appellant did not know how many times he organized lunches during his employment with the Dolan law firm.

Troy Walker, a former receptionist at the Dolan law firm from April 2002 until February 2005 testified appellant would frequently refuse to take phone calls after 8:30 a.m. because he was on a rest break or lunch break. Walker also said he typically observed The Troll is Out sign posted around lunch time. Jeremy Pasternak, an attorney who worked for respondent from 2001 through the spring of 2004, testified that he often observed appellants The Troll is Out sign posted during the workday. Pasternak testified that he frequently saw appellant at his desk in the mornings before 8:30 a.m. with his feet up, leaning back, with his eyes closed or reading a novel. He observed appellant engaged in these same activities during the workday. Pasternak also testified that appellant organized office lunches not infrequently, and called himself the party captain. Joshua Brandon testified that he would see appellant sleeping or reading during the workday, with his troll sign up [t]wice a day, at least. This constitutes substantial evidence that appellant was taking his breaks and lunches regularly and that Labor Code sections 226.7 and 512 were not violated.

Appellant makes one related argument, contending his right to a timely lunch break under Labor Code section 512 was violated. Appellant contends the trial court misinterpreted section 512 when it concluded the provision did not require a lunch period to commence within the first five hours of the workday. We agree with the trial court that section 512 does not mandate a meal period be taken within the first five hours of a workday.  [C]ourts are bound to give effect to statutes according to the usual, ordinary import of the language employed in framing them. [Citations.] (California Teachers Assn. v. San Diego Community College Dist. (1981) 28 Cal.3d 692, 698.)  If the words of the statute are clear, the court should not add to or alter them to accomplish a purpose that does not appear on the face of the statute or from its legislative history. [Citations.] (Ibid.) Here, section 512, subdivision (a) requires only that a 30-minute lunch break be given to employees employed more than five hours per day and does not specify a timing requirement. Appellant provides no other support for reading in such a requirement, and we refuse to do so.

In the alternative, appellant argues Labor Code section 512 requires a meal period within the first six hours of the workday, and he was denied this right on 39 days. We agree with appellants contention that the language of section 512, subdivision (b) implies that unless the IWC adopts a specific rule to the contrary, a lunch period must begin within the first six hours of work.^[7] However, nothing in the record suggests that the trial court disagreed with that conclusion, and sufficient evidence supports the trial courts implicit finding that appellant failed to prove respondent had violated this requirement. The only evidence offered at trial to support appellants testimony was his timesheets from January 21, 2002, to August 30, 2002, that suggest appellant did not take lunch within the first six hours of work. However, the trial court did not admit these timesheets for the truth of the matter asserted; rather, they were admitted simply to demonstrate appellant was turning in timesheets.

Further, the trial court expressed strong reservations as to the credibility of appellants testimony regarding his timesheets, stating, [I]t is inadvisable to rely too heavily on his timesheets as an accurate indicator of his work habits or work history after August 2002. Appellant, in fact, testified that he did not always truthfully report his hours on his timesheets. Appellant also admitted he sometimes delayed in filling out timesheets until the end of a pay period. When considered in conjunction with the testimony of respondents witnesses Brandon, Walker and Pasternak, set out above, the unreliability of the timesheets supports the trial courts conclusion appellant took his lunch breaks within the normal lunchtime, between 12:00 p.m. and 2:00 p.m., which would have been within a six hour window of his 8:30 a.m. start time.

B. Labor Code Section 513Makeup Time

Labor Code section 513 provides: If an employer approves a written request of an employee to makeup work time that is or would be lost as a result of a personal obligation of the employee, the hours of that makeup work time, if performed in the same workweek in which the work time was lost, may not be counted towards computing the total number of hours worked in a day for purposes of the overtime requirements specified in Section 510 or 511, except for hours in excess of 11 hours of work in one day or 40 hours in one workweek. An employee shall provide a signed written request for each occasion that the employee makes a request to makeup work time pursuant to this section. An employer is prohibited from encouraging or otherwise soliciting an employee to request the employers approval to take personal time off and makeup the work hours within the same week pursuant to this section.

As the trial court articulated, Labor Code section 513 addresses makeup time that is performed in the same workweek in which the work time was lost. The trial court concluded [i]t does not appear that any lost work hours to be made up by [appellant] were to be performed in the same workweek in which the work time was lost and the statute did not apply.^[8] As evidence of his makeup time, appellant refers only to five e‑mails in evidence, all of which were written by appellant regarding efforts to makeup missed time. By their terms, only three of these e‑mails even purport to discuss makeup time performed within the week the time was lost. And it appears as though at least two of these three were admitted into evidence for the limited purpose of notice and not for the truth of their contents. At best this leaves one e‑mail, in which appellant merely predicts that he might work additional hours later that day in order to makeup hours missed the previous day. As already discussed, the court did not find appellant credible and, so, the court reasonably could conclude that this makeup time did not in fact occur. There is substantial evidence that respondent did not violate Labor Code section 513.

C. Overtime Wages

On appeal, appellant also challenges the courts conclusion that he was not entitled to additional overtime wages because he did not continue to work overtime hours after August 2002. Again, substantial evidence supports the trial court ruling.

Pasternak testified that if appellant was in the office prior to 8:30 a.m., he was usually sleeping or reading a novel. Walker testified that prior to 8:30 a.m., appellant would say that he was not in the office yet and would not accept phone calls. Walker, who sat at the front of the office next to the door, would see appellant leave a little early, usually by 5:00 [p.m.], sometimes even sooner, 4:30 [p.m.]. Also, in their agreement memorialized by e‑mail on August 28, 2002, appellant and respondent explicitly agreed that appellant would be able to complete his tasks between the hours of 8:30 a.m. and 5:30 p.m. and would no longer work overtime.

D. Labor Code Section 206.5Unlawful release

Labor Code section 206.5 provides: No employer shall require the execution of any release of any claim or right on account of wages due, or to become due, or made as an advance on wages to be earned, unless payment of such wages has been made. Any release required or executed in violation of the provisions of this section shall be null and void as between the employer and the employee and the violation of the provisions of this section shall be a misdemeanor.

The trial court found no unlawful release was entered into because appellant failed to demonstrate that he was owed any additional compensation at the time he received his last paycheck. On appeal, appellant does not challenge the courts application of the statute, but rather relies on his previous claims that he was owed additional compensation as a result of lost lunch and rest periods, mischaracterized makeup time and overtime. As discussed, sufficient evidence supports the trial courts rejection of each such claim. Because no wages were due at the time appellant ended his employment, the court properly concluded the release did not violate Labor Code section 206.5.

E. Labor Code Sections 226 and 1174Pay Stubs and Time Records

Labor Code sections 226 and 1174 impose certain requirements relating to pay stubs and time records. As appellant points out, the trial court found respondent did not provide proper pay stubs and appellants time records were missing; however, the court found that no injury resulted from these deficiencies. This finding of no injury defeats appellants statutory claim under Labor Code section 226 and defeats appellants attempt to pursue a Business and Professions Code section 17200 claim for both Labor Code violations. Substantial evidence supported this finding of no injury.

1. Labor Code Section 226Itemized Statements to Employees

In 2002, Labor Code section 226, subdivision (a) provided in relevant part: (a) Every employer shall, semimonthly or at the time of each payment of wages, furnish each of his or her employees, either as a detachable part of the check, draft, or voucher paying the employees wages, or separately when wages are paid by personal check or cash, an itemized statement in writing showing (1) gross wages earned, (2) total hours worked by the employee, except for any employee whose compensation is solely based on a salary and who is exempt from payment of overtime under subdivision (a) of Section 515 or any applicable order of the [IWC], . . . , (8) the name and address of the legal entity that is the employer, and (9) all applicable hourly rates in effect during the pay period and the corresponding number of hours worked at each hourly rate by the employee. [] The deductions made from payments of wages shall be recorded in ink or other indelible form, properly dated, showing the month, day, and year, and a copy of the statement or a record of the deductions shall be kept on file by the employer for at least three years at the place of employment or at a central location within the State of California.^[9] (Stats. 2000, ch. 876,  6.)

Labor Code section 226, subdivision (e) provides: An employee suffering injury as a result of a knowing and intentional failure by an employer to comply with subdivision (a) is entitled to recover the greater of all actual damages or fifty dollars ($50) for the initial pay period in which a violation occurs and one hundred dollars ($100) per employee for each violation in a subsequent pay period, not exceeding an aggregate penalty of four thousand dollars ($4,000), and is entitled to an award of costs and reasonable attorneys fees. (Italics added.)

The trial court stated that pay check stubs issued after August 2002 showed that nearly all of the itemized statements which accompanied each of [appellants] paychecks did not include a separate statement of the total number of hours worked which the law requires . . . . However, the court reasoned that because appellant testified that he no longer filled out time records or kept track of his hours after August 2002, there is no reason to expect that recording the number of hours reported for each pay period would show any number other than one reflecting a [40]-hour workweek. Consequently, a properly completed pay stub would be of little assistance in showing [appellants] actual time spent on the job. In addition, the courts conclusion, supported by substantial evidence, that appellant had been properly compensated for all hours he worked demonstrates he was not injured by any violation of Labor Code section 226. This finding of no injury precludes appellants claim for statutory damages under this section, and for an unfair practice under Business and Professions Code section 17200.

Appellant relies on Hernandez v. Mendoza (1988) 199 Cal.App.3d 721 to argue the trial court improperly placed the burden to maintain and produce accurate records on appellant. Appellant misunderstands Hernandez. In that case, a butcher brought suit against his grocery store employer for unpaid overtime compensation. (Id. at p. 724.) The trial court concluded that the employee had failed to prove the precise amount of overtime worked and entered judgment for the employer. (Id. at p. 725.) On appeal, the court noted that it was undisputed that the employee worked more than [eight] hours per day and more than 40 hours per week and the record showed without question that [the employee] incurred damages of uncompensated overtime during the disputed period. (Id. at p. 726.) The Court of Appeal reversed the trial court and explained: Once an employee shows that he performed work for which he was not paid, the fact of damage is certain; the only uncertainty is the amount of damage. [Citations.] (Ibid.)  [W]here the employers records are inaccurate or inadequate . . . , we hold that an employee has carried out his burden if he proves that he has in fact performed work for which he was improperly compensated and if he produces sufficient evidence to show the amount and extent of that work as a matter of just and reasonable inference. The burden then shifts to the employer to come forward with evidence of the precise amount of work performed . . . . [Citations.] (Id. at p. 727.) Unlike Hernandez, appellant failed to demonstrate he performed work for which he was not paid, and thus failed to meet the threshold in Hernandez necessary to shift the burden to his employer regarding the precise number of hours worked.

2. Labor Code Section 1174Time records

Since 2002, Labor Code section 1174, subdivision (d) has provided, in relevant part: Every person employing labor in this state shall: [] . . . [] (d) Keep, at a central location in the state or at the plants or establishments at which employees are employed, payroll records showing the hours worked daily by and the wages paid to . . . employees employed at the respective plants or establishments. These records shall be kept in accordance with rules established for this purpose by the commission, but in any case shall be kept on file for not less than two years.

Appellant did not allege a violation of Labor Code section 1174 in his operative complaint; however, the trial court took judicial notice of this section at appellants request during trial. In its statement of decision, the trial court acknowledged that respondent was unable to produce appellants time records, but stated it was unnecessary to resolve the dispute between the parties as to why they were missing: [T]he presence or absence of time records is relevant and material only if there is credible evidence that [appellant], in fact, worked overtime hours or that he worked through lunch and rest periods for which he was not compensated . . . . The trial court confirmed [t]he focus should be on whether [appellant] in fact worked overtime and through breaks and that [respondent] was or should have been aware that [appellant] was doing so.

As with the check stubs, substantial evidence supported the conclusion that appellant suffered no injury as a result of the missing timesheets. As previously discussed, there was substantial evidence that appellant did not work overtime or through lunches or rest periods without appropriate compensation. These findings along with the trial courts aforementioned reservations as to the credibility of appellants timesheets support the conclusion that appellant suffered no injury as a result of the absence of time records under Labor Code section 1174.

F. Appellants Fraud Cause of Action

Finally, appellant contends that the trial courts findings substantiated his fraud cause of action. In his complaint, appellant alleged that respondent committed fraud in the August 28, 2002 meeting by intentionally misrepresenting to appellant that he was paid on a salary basis and was exempt from overtime compensation. The trial court found, however, that appellant failed to establish an intentional misrepresentation or concealment by respondent. Appellant, himself, wrote the e‑mail memorializing the agreement and made no reference to any such representation.

In addition, the court stated that even if respondent had made a misrepresentation that appellant relied upon, appellant failed to demonstrate that he actually worked overtime hours or through lunch or rest periods. As previously discussed, substantial evidence supports this conclusion and the conclusion precludes appellant from demonstrating he suffered harm from the alleged fraud. Because he suffered no injury, he lacked standing for his Business and Professions Code section 17200 claim.

Appellant argues that the trial courts ruling effectively granted nonsuit on appellants claim of fraud, and, for this reason was erroneous. It appears that appellant is contending the trial courts ruling on his Business and Professions Code section 17200 claim should not preclude a future trial on his fraud cause of action. This contention is certainly meritless and borders on frivolous. As one piece of its resolution of appellants unfair business practices claim, the trial court decided no fraud had been committed and no injury had occurred. Just as the parties are bound by collateral estoppel where issues are litigated in a prior action, so, too, do issues decided by the court in the equitable phase of the trial become conclusive on issues actually litigated between the parties.  (Nwosu v. Uba (2004) 122 Cal.App.4th 1229, 1244, quoting 7 Witkin, Cal. Procedure (4th ed. 1997) Judgment, 281, p. 821.) Appellants inability to demonstrate an intentional misrepresentation in the trial on the equitable issues would also preclude him from proving all elements necessary for his independent fraud cause of action. It was proper for the trial court to proceed on the equitable claims first, and having made determinations that would preclude further recovery by appellant, appellant is not entitled to proceed to a jury trial on this same claim. (See Nwosu, at pp. 1237-1240.)^[10]

IV. Exclusion of Exhibits 108 and 110 Pursuant to Evidence Code Section 1152

Appellant contends the trial court erred in excluding trial exhibits 108 and 110 pursuant to Evidence Code section 1152^[11]as settlement communications. Appellant argues the documents would have impeached respondent and further demonstrated appellants entitlement to damages. However, appellant does not cite nor can we find a definitive ruling by the trial court excluding this evidence. Where the court reserves its ruling, but does not decide the point, the failure to rule formally is an implied ruling against the objection and in favor of admissibility. [Citations.] (3 Witkin, Cal. Evidence (4th ed. 2000) Presentation at Trial, 387, p. 480.)

Exhibits 108 and 110 were written communications between appellant and respondent, and respondent and appellants counsel. When plaintiff first marked these documents for identification, respondent objected under Evidence Code section 1152. The trial court took the objection under submission. Later at trial, when the parties were reviewing the status of various exhibits, exhibits 108 and 110 were again discussed and the court concluded the discussion by stating: So 110 and 108 are 1152 issues, Evidence Code, still pending. There does not appear to be any further discussion on the admissibility of exhibit 108 or 110. Because the court did not conclusively decide the point, we imply a ruling against the objection and in favor of admissibility. Appellants argument fails.^[12]

Disposition

The judgment is affirmed. Respondent shall be awarded costs on appeal.

SIMONS, J.

We concur.

JONES, P.J.

GEMELLO, J.

Publication courtesy of San Diego pro bono legal advice.

Analysis and review provided by Poway Property line attorney.

^[1] Respondent cross-complained for damages for fraud and declaratory relief regarding certain proprietary materials belonging to respondent. Appellant prevailed on the cross-complaint. Neither party is appealing any issues regarding respondents cross-complaint.

^[2] Code of Civil Procedure section 632 provides, in relevant part: In superior courts, upon the trial of a question of fact by the court, written findings of fact and conclusions of law shall not be required. The court shall issue a statement of decision explaining the factual and legal basis for its decision as to each of the principal controverted issues at trial upon the request of any party appearing at the trial. The request must be made within 10 days after the court announces a tentative decision unless the trial is concluded within one calendar day or in less than eight hours over more than one day in which event the request must be made prior to the submission of the matter for decision. The request for a statement of decision shall specify those controverted issues as to which the party is requesting a statement of decision. After a party has requested the statement, any party may make proposals as to the content of the statement of decision.

^[3] Code of Civil Procedure section 634 states: When a statement of decision does not resolve a controverted issue, or if the statement is ambiguous and the record shows that the omission or ambiguity was brought to the attention of the trial court either prior to entry of judgment or in conjunction with a motion under Section 657 or 663, it shall not be inferred on appeal or upon a motion under Section 657 or 663 that the trial court decided in favor of the prevailing party as to those facts or on that issue. Here, the record does not demonstrate any attempt by appellant to alert the trial court to any omissions or ambiguity in the statement of decision and we will imply findings to support the judgment. (In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1133-1134.)

^[4] Respondent has argued Business and Professions Code section 17209 precludes relief for appellant because appellant failed to serve a copy of his brief with the Attorney General; however, on September 19, 2006, we granted appellants motion for extension of time for service pursuant to Business and Professions Code section 17209 and appellant provided the necessary proof of service on September 22, 2006. This September 19 order granting the extension of time also moots appellants requests for judicial notice filed on September 1 and September 11, 2006, and, on that ground, the requests for judicial notice are denied.

^[5] Based on IWC Wage Order 4-2001, effective January 1, 2001, the California Code of Regulations, title 8, section 11040, subdivision (12) provides: (A) Every employer shall authorize and permit all employees to take rest periods, which insofar as practicable shall be in the middle of each work period. The authorized rest period time shall be based on the total hours worked daily at the rate of ten (10) minutes net rest time per four (4) hours or major fraction thereof. However, a rest period need not be authorized for employees whose total daily work time is less than three and one-half (3 1/2) hours. Authorized rest period time shall be counted as hours worked for which there shall be no deduction from wages. [] (B) If an employer fails to provide an employee a rest period in accordance with the applicable provisions of this order, the employer shall pay the employee one (1) hour of pay at the employees regular rate of compensation for each workday that the rest period is not provided.

^[6] Appellant first argues the trial court explicitly found that appellant missed 49 meal periods for which he was not compensated in accordance with Labor Code section 226.7, subdivision (b) and this should have resulted in a finding of an express violation of the law. However, this mischaracterizes the statement of decision. In fact, the language appellant quotes states only that appellant worked through lunch on 49 days. And, in contrast to appellants version, the court actually stated: When he reported working before 8:30 a.m. or through lunch breaks, time and pay stub records reflect he was paid accordingly.

^[7] Labor Code section 512, subdivision (b) states: Notwithstanding subdivision (a), the [IWC] may adopt a working condition order permitting a meal period to commence after six hours of work if the commission determines that the order is consistent with the health and welfare of the affected employees.

^[8] To the extent appellant argues that he worked overtime in other weeks to makeup for prior absences, and that this work constituted uncompensated overtime, the trial court rejected this argument. See the discussion in part III.C., post.

^[9] Labor Code section 226, subdivision (a) was amended in 2002 without substantive change. (Stats. 2002, ch. 933,  1.)

Appellant also relies on IWC Order 4-2001 (Cal. Code Regs., tit. 8,  11040) to support his argument that employers are required to keep and provide certain payroll records. Subdivision (7) provides in relevant part: (A) Every employer shall keep accurate information with respect to each employee including the following: [] . . . [] (3) Time records showing when the employee begins and ends each work period . . . . [] . . . [] (B) Every employer shall semimonthly or at the time of each payment of wages furnish each employee, either as a detachable part of the check, draft, or voucher paying the employees wages, or separately, an itemized statement in writing showing: (1) all deductions . . . . Although a violation of IWC Wage Order 4-2001 was alleged in the complaint regarding overtime and break requirements, subdivision (7) regarding records was not mentioned. This section appears to reflect the requirements of Labor Code sections 226 and 1174 and does not change the analysis.

^[10] Presumably, the trial courts awareness of this rule led it to invite supplemental briefing if any party believed jury issues remained. Appellant filed no such brief.

^[11] Evidence Code section 1152, subdivision (a) provides, in relevant part: Evidence that a person has, in compromise or from humanitarian motives, furnished or offered or promised to furnish money or any other thing, act, or service to another who has sustained or will sustain or claims that he or she has sustained or will sustain loss or damage, as well as any conduct or statements made in negotiation thereof, is inadmissible to prove his or her liability for the loss or damage or any part of it.

^[12] In his brief, respondent requests sanctions for appellants failure to properly prepare and present the factual record and for filing a frivolous appeal. California Rules of Court, rule 8.276(e)(1) (former rule 27(e)(1)) provides in relevant part On a partys or its own motion, a Court of Appeal may impose sanctions . . . . Respondents failure to make a motion was procedurally improper and we deny his request on this basis.

Appellant filed a motion for sanctions pursuant to California Rules of Court, rule 8.276 (former rule 27) on September 22, 2006, alleging respondents disregard for orders of the court and procedural rules. Rule 8.276(e)(1) provides: On a partys or its own motion, a Court of Appeal may impose sanctions, including the award or denial of costs, on a party or an attorney for: [] (A) Taking a frivolous appeal or appealing solely to cause delay; [] (B) Including in the record any matter not reasonably material to the appeals determination; or [] (C) Committing any other unreasonable violation of these rules. We deferred ruling on this motion. We exercise our discretion and deny the motion. (See Ferguson v. Keays (1971) 4 Cal.3d 649, 658 [stating the appellate courts have discretion to impose appropriate sanctions or penalties upon the parties or their attorneys].) Even if true, respondents alleged violations of the rules of court are not so unreasonable as to warrant sanctions. Appellants request for sanctions for respondents alleged violation of the courts redaction order is not supported and we deny sanctions as to this allegation as well.