Case Number: KC069557 Hearing Date: March 09, 2018 Dept: J

Re: Sophia Shumaker v. C.S. Scarcella & Associates, et al. (KC069557)

DEMURRER TO SECOND AMENDED COMPLAINT

Moving Parties: Defendants Christopher Scarcella and C.S. Scarcella & Associates

Respondent: Plaintiff Sophia Shumaker

POS: Moving OK; Opposing filed timely but not accompanied by a proof of service

This is an alleged legal malpractice case arising out of defendants’ representation of plaintiff in her marital dissolution action styled Shumaker v. Shumaker, Case No. FAMRS1400913. The complaint was filed 8/17/17. The First Amended Complaint was filed 10/16/17. The Second Amended Complaint, filed 1/16/18, asserts causes of action against C.S. Scarcella & Associates, Christopher Scarcella and Does 1-100 for:

Legal Malpractice

Breach of Fiduciary Duty

A Case Management Conference is set for 3/28/18.

Defendants C.S. Scarcella & Associates (“CSSA”) and Christopher Scarcella (“Scarcella”) (collectively, “defendants”) demur to the first and second causes of action in Plaintiff Sophia Shumaker’s Second Amended Complaint (“SAC”).

REQUEST FOR JUDICIAL NOTICE:

At the outset, defendants’ request for judicial notice (“RJN”) is ruled on as follows: grant as to Exhibit “1” (i.e., “Substitution of Attorney” filed 4/19/16 in case styled Shumaker v. Shumaker, Case No. FAMRS 1400913 [i.e., “Underlying Action”]); grant as to Exhibit “2” (i.e., 4/21/16 minute order in Underlying Action); grant as to Exhibit “3” (i.e., “Motion of Petitioner Sophia Shumaker to Set Aside Stipulated Judgment” filed 6/13/16); grant as to Exhibit “4” (i.e., 1/8/18 tentative ruling in this case [adopted as final]) and grant as to Exhibit “5” (i.e., 8/24/16 minute order in Underlying Action).

FIRST CAUSE OF ACTION (LEGAL MALPRACTICE):

“Where a demurrer raises the bar of the applicable statute of limitations, the court assesses whether ‘”

the complaint shows on its face that the statute bars the action.”’ (E-Fab, Inc. [v. Accountants, Inc. Sevrices (2007)] 153 Cal.App.4th 1308, 1315). Such a defect ‘”must clearly and affirmatively appear on the face of the complaint; it is not enough that the complaint shows merely that the action may be barred.” [Citations.]’ (Id. at p. 1316).” Czajkowski v. Haskell & White, LLP (2012) 208 Cal.App.4th 166, 174.

The controlling statute of limitations provision for a legal malpractice cause of action is CCP § 340.6, which provides in relevant part that “[a]n action against an attorney for a wrongful act or omission…arising from the performance of professional services shall be commenced within one year after the plaintiff discovers or through 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: (1) The plaintiff has not sustained actual injury. (2) The attorney continues to represent the plaintiff regarding the specific subject matter in which the alleged wrongful act or omission occurred. (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. (4) The plaintiff is under a legal or physical disability which restricts the plaintiff’s ability to commence legal action…”

“The statute of limitations, a legislatively prescribed time period to bring a cause of action, ‘exists to promote the diligent assertion of [the] claim[ ], ensure defendants the opportunity to collect evidence while still fresh, and provide repose and protection from dilatory suits once excess time has passed.’ (Aryeh[ v. Canon Business Solutions, Inc. (2013)] 55 Cal.4th [1185,] at p. 1191; accord, Shively v. Bozanich (2003) 31 C.4th 1230, 1246)…Traditionally, a claim accrues ‘”’when [it] is complete with all of its elements’—those elements being wrongdoing [or breach], harm, and causation.”’ (Aryeh, at p. 1191; accord, Howard Jarvis Taxpayers Assn. v. City of La Habra (2001) 25 Cal.4th 809…].).” Gilkyson v. Disney Enterprises, Inc. (2016) 244 Cal.App.4th 1336, 1341. “[W]hen malpractice results in the loss of a right, remedy, or interest, or in the imposition of a liability, there has been actual injury regardless of whether future events may affect the permanency of the injury or the amount of monetary damages eventually incurred.” Foxborough v. Van Atta (1994) 26 Cal.App.4th 217, 227.

Plaintiff alleges that (1) she was the petitioner in the Underlying Action filed 4/2/14, (2) she hired defendants to represent her in the Underlying Action, (3) Scarcella substituted into the Underlying Action as her counsel six days prior to her trial and represented her at trial on 11/18/15, (4) “[p]rior to the completion of the trial, Scarcella negotiated with opposing counsel on plaintiff’s behalf and…reached an agreement that purported to resolve all of the outstanding issues” in the Underlying Action, (5) “[t]he terms of the negotiated agreement included an equal distribution of the proceeds from the sale of the community property residence owned by Plaintiff and her (then) husband,” (6) “[t]he negotiated agreement was subsequently memorialized in a written Stipulation for Judgment” which Scarcella reviewed prior to its execution, and that (7) plaintiff learned after the judgment became final and enforceable that it did not contain provisions awarding her one-half of the sale proceeds from the family home and that the entire amount was going to her ex-husband. (SAC, ¶¶ 9-18). Plaintiff further alleges that (1) Scarcella promised to “fix the situation” and filed an ex parte motion for relief under the discretionary provisions of CCP § 473, which was denied. (Id., ¶¶ 21-23). Plaintiff thereafter retained her current counsel, who prepared a CCP § 473 motion under the attorney-fault provision. (Id., ¶¶ 24-25). Plaintiff alleges that Scarcella provided “significant assistance” with this second § 473 motion and signed a supporting declaration of fault. (Id., 26-29). Plaintiff asserts that Scarcella’s participation and assistance in the Underlying Action did not end until 8/24/16, when the second § 473 motion was denied. (Id., ¶ 32).

Judicially noticeable documents reflect that a “Substitution of Attorney” was filed in the Underlying Action on 4/19/16, wherein Scarcella substituted out as counsel and plaintiff became self-represented. (RJN, Exhibit “1”). On 4/21/16, plaintiff’s “Request for Order re: Set Aside Judgment” was ordered continued to 5/12/16. (Id., Exhibit “3”). On 6/13/16, plaintiff’s current counsel filed a “Motion to Set Aside Stipulated Judgment” in the Underlying Action. (Id., Exhibit “3”). On 8/24/16, this motion was denied. (Id., Exhibit “5”).

Defendants assert that the statute of limitations commenced running on 4/19/16, when the “Substitution of Attorney” was filed in the Underlying Action. Defendants assert that any “assistance” plaintiff claims defendants provided her new counsel occurred after the substitution was filed, and that such “assistance” did not constitute “continuous representation” by them.

“A plaintiff who is aware of, and has been actually injured by, attorney malpractice in a matter need not file suit for malpractice while that attorney is still representing him on the same ‘specific subject matter.’ (§ 340.6, subd. (a)(2); Truong [v. Glasser (2009)] 181 Cal.App.4th [102,] at p. 116; cf. Foxborough [v. Van Atta (1994)] 26 Cal.App.4th [217,] at pp. 228-229 [no tolling where ‘an attorney’s subsequent role is only tangentially related to the legal representation the attorney provided to the plaintiff’].) In deciding whether an attorney continues to represent a client, we do not focus ‘”on the client’s subjective beliefs;”’ instead, we objectively examine “’evidence of an ongoing mutual relationship and of activities in furtherance of the relationship.”’ (Truong, supra, 181 Cal.App.4th at p. 116, quoting Worthington v. Rusconi (1994) 29 Cal.App.4th 1488, 1498; Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 887).” Shaoxing City Maolong Wuzhong Down Products, Ltd. v. Keehn & Associates, APC (2015) 238 Cal.App.4th 1031, 1038 (emphasis theirs).

“Where an attorney unilaterally withdraws or abandons his client, ‘the representation ends when the client actually has or reasonably should have no expectation that the attorney will provide further legal services.’ (Gonzalez v. Kalu (2006) 140 Cal.App.4th 21, 30). But where…the attorney has been formally substituted out as counsel, that act of substitution, that act of substitution ordinarily ends the relationship (id. at p. 28; accord, Lacletter v. Galindo (2010) 184 Cal.App.4th 919, 927; Gurkewitz v. Haberman (1982) 137 Cal.App.3d 328, 332-333), although the relationship can continue—notwithstanding the withdrawal and substitution—if the objective evidence shows that the attorney continues to provide legal advice or services (Nielsen v. Beck (2007) 157 Cal.App.4th 1041, 1052).” Id. at 1039 (emphasis added).

In Shaoxing, the Second District Court of Appeal affirmed the trial court’s order granting summary judgment in favor of defendant attorneys and determined, inter alia, that the statute of limitations was not tolled by “continuing representation” after defendant attorneys substituted out of the case. The Court of Appeal remarked: “the undisputed evidence establishes that plaintiffs’ relationship with Keehn ended when Landsberg substituted in as counsel. The sole evidence of a continuing relationship after that point in time is the statement of a Keehn employee that Keehn would ‘oversee the transition’ and ‘assist’ Landsberg ‘with his work on the case’…[h]owever, this statement alone does not establish a continuing attorney-client relationship. Assisting the transition from one attorney to another is not providing assistance on the same subject matter. (Foxborough, supra, 26 Cal.App.4th at pp. 228-229; Gurkewitz, supra, 137 Cal.App.3d at p. 334). And the undisputed evidence–as well as counsel’s concession at oral argument–establishes that Keehn provided no legal services or representation after Keehn was substituted out as counsel. It is undisputed that Keehn provided no advice to plaintiffs or to Landsberg; they performed no work for them; they sent no bills for legal services relating to ongoing representation; they never appeared for plaintiffs and never negotiated on plaintiffs’ behalf; they never even spoke or communicated with Landsberg or plaintiffs regarding the pending bankruptcy case. Such acts are required for there to be a continuing attorney-client relationship.” Id.

This instant case is in a procedurally distinct posture and involves allegations that defendants, subsequent to their withdrawal as plaintiff’s counsel, provided “significant assistance” to plaintiff’s new counsel in connection with plaintiff’s CCP § 473 motion for relief, including the execution of a mandatory affidavit of fault. Based on these allegations, the court determines that the SAC does not “clearly and affirmatively” show on its face that it is time-barred.

Defendants’ collateral estoppel argument fails. “Collateral estoppel applies when (1) the party against whom the plea is raised was a party or was in privity with a party to the prior adjudication, (2) there was a final judgment on the merits in the prior action and (3) the issue necessarily decided in the prior adjudication is identical to the one that is sought to be relitigated.” Ross v. Red (2005) 130 Cal.App.4th 870, 879. Defendants have not shown that the issue was necessarily decided in the prior adjudication. The 8/24/16 minute order in the Underlying Action does not contain any explanation as to why the motion was denied. (RJN, Exhibit “5”).

Defendants’ contention that plaintiff has failed to plead damages is belied by ¶¶ 34-36 and the prayer for damages in the SAC. Accordingly, defendants’ demurrer to the first cause of action is overruled.

SECOND CAUSE OF ACTION (BREACH OF FIDUCIARY DUTY):

Defendants’ attack on the second cause of action fails, for the reasons articulated above. Defendants’ demurrer to the second cause of action is overruled.

Defendants have ten days to answer.