Cal-City Construction v. Wilson, Elser
A jury found in favor of respondent Cal-City Construction, Inc. (Cal-City) in its legal malpractice action against appellant Wilson, Elser, Moskowitz, Edelman & Dicker, LLP (Wilson Elser). The evidence established that Wilson Elser was retained to represent Cal-City after the Los Angeles Unified School District (District) removed Cal-City on a construction project known as Belmont 2 and refused to make progress payments on a construction project known as Belmont 3. Wilson Elser advised Cal-City to walk off Belmont 3. Cal-City walked off and sued the District for breaching its contracts on both projects. Just prior to trial, Wilson Elser advised Cal-City that it should never have walked off Belmont 3, and that because it did so, its only option was to settle on unfavorable terms. Cal-City obtained a judgment against Wilson Elser for $2,478,500 plus costs. The award included $941,000 in damages related to the adverse settlement with the District, and $1,722,500 for lost future profits on the theory that Wilson Elsers negligence caused Cal-City to lose bonding capacity and forfeit projects that it was thereby prevented from bidding on. Wilson Elser moved for judgment notwithstanding the verdict (JNOV) or, in the alternative, for partial JNOV regarding lost future profits. The motion was denied. Wilson Elser now appeals the judgment and the denial of the motion for JNOV and argues: (1) Cal-City failed to offer evidence that it would have obtained a better result in the underlying disputes but for Wilson Elsers negligence; and (2) Cal-Citys award for lost future profits was based on speculative evidence. Court conclude that substantial evidence supports a finding that Wilson Elser caused Cal-City damage in connection with the underlying disputes, and that the award of $941,000 must stand. However, Court also conclude that the trial court should have granted a partial JNOV as to lost future profits. Cal-Citys evidence of lost profits was speculative and uncertain. Court granted Cal-Citys petition for rehearing to amplify the law on this point, and to reject Cal-Citys contention that evidence in the record it did not previously cite calls for a different conclusion. Court affirm the judgment, but only after modifying it to remove the award of lost future profits.
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