Filed 8/27/26 Horner v. Strong Wealth Management CA2/1 NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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
MICHAEL HORNER et al., B337039
Plaintiffs and Respondents, (Los Angeles County Super. Ct. No. 21STCV17667)
v.
STRONG WEALTH MANAGEMENT LLC et al.,
Defendants and Appellants.
APPEALS from a judgment and orders of the Superior Court of Los Angeles County, Jon R. Takasugi, Judge. Affirmed as modified.
Grignon Law Firm, Margaret M. Grignon, Anne M.
Grignon; Jones, Bell, Abbott, Fleming & Fitzgerald and Kevin K. Fitzgerald for Defendants and Appellants.
Ervin Cohen & Jessup, Michael C. Lieb and Zoe M. Vallier for Plaintiffs and Respondents.
_________________________
In August 2019, plaintiff Michael Horner, who was 83 years old at the time, entrusted defendant George G. Strong III and his financial management company, Strong Wealth Management LLC (Strong Wealth) with responsibility for managing an investment portfolio valued at $2,616,421. Over the next 16 months, as the stock market thrived, Horner’s portfolio did not. By December 1, 2020, the value of the portfolio had dropped more than 80 percent, to $475,099.23, compared with an increase of 27 percent in the Standard & Poor’s 500 index over the same time period.
Horner and his son Thomas, as trustees of their family trust (collectively Horner), sued Strong and Strong Wealth (collectively Strong) alleging several causes of action arising from Strong’s management of the portfolio. After a bench trial, the court found Strong liable for breach of fiduciary duty, negligence, breach of contract, and financial elder abuse.
In this appeal, Strong challenges the last of those findings.
He argues that financial elder abuse applies only where a defendant “[t]akes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult” (Welf. & Inst. Code, § 15610.30, subd. (a)(1)),1 and he claims that even if he mismanaged Horner’s account, he did not take property from him, nor did he benefit from Horner’s loss. Strong also contends the trial court erred by awarding double damages under Civil Code section 3345 and by awarding prejudgment interest on the entire amount of the judgment, rather than the amount attributable to compensatory damages alone.
1 Unspecified statutory references are to the Welfare and Institutions Code.
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We agree with Strong as to the amount of prejudgment interest. Otherwise, we affirm the judgment, as we explain below. FACTUAL BACKGROUND AND PRIOR PROCEEDINGS The following account is drawn primarily from the trial court’s factual findings at the conclusion of the bench trial.
Horner and his late wife created a living trust in 1995 and placed their assets in it. Horner managed the investments in the trust for decades, but in 2019, he decided that they were taking up too much of his time and proving too stressful. He elected to turn over management of his portfolio to Strong, a financial advisor he had recently met at a car show. Both Horner and Strong believed the stock market was overheated and due for a correction.
Horner told Strong he wanted to withdraw $10,000 per month from the portfolio to pay his living expenses. In questionnaires Horner filled out in July and August 2019, he indicated that his primary objectives were income and capital preservation, and that he did not mind if his returns lagged the market so long as he was protected against significant losses. Apparently, Strong did not review these forms. He testified at his deposition that he was seeing them for the first time. In an email to Strong, Horner listed a series of positions he wanted Strong not to sell, and to add to if possible, including shares of Amazon, Apple, Costco, and Visa.
Strong moved Horner’s account to an online brokerage called Interactive Brokers for trading. Interactive Brokers’s software limited the types of trades available to an account based on the account’s objectives. If an account listed its goals as preservation of capital or income, the software would not allow
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the account to engage in most options trading. Initially, Horner’s Interactive Brokers account listed his objectives as trading and hedging, and by the first quarter of 2020 included speculation. These objectives did allow for trading options. Horner denied he authorized these changes to his account objectives. Strong testified that Horner agreed to the changes. The trial court stated that it did “not doubt [Strong] explained the need” for the changes, but noted that Strong “is a real fast talker and somewhat difficult to follow.”
For the first few months under Strong’s management, Horner’s portfolio underperformed the market but still eked out positive returns. In the fourth quarter of 2019, Horner’s account gained 1.17 percent, while the S&P 500 gained nearly 10 percent. The following quarter, the portfolio lost 21.8 percent, roughly in line with the market as a whole, which dropped significantly with the advent of the COVID-19 pandemic. But from that point forward, the losses grew steeper even as the overall stock market rebounded. In the second quarter of 2020, the portfolio lost 35.4 percent, while the S&P 500 gained about 20 percent. The following quarter, the portfolio lost an additional 59.82 percent, compared with a gain of almost 9 percent for the S&P 500. As the losses piled up, Strong sold shares of the companies Horner had previously directed Strong not to sell.2
2 Because of the sheer volume of Strong’s trading and his employment of options, it is difficult to determine from the record exactly when and in what circumstances these shares were sold, but in August 2019, Horner held 90 shares of Amazon, 3,200 split-adjusted shares of Apple, 300 shares of Costco, and 200 shares of Visa in his two investment accounts. By the end of September 2020, according to the third-quarter portfolio report
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After seeing the account statement for the third quarter of 2020, Horner told Strong to stop options trading and to unwind the account. By December 1, 2020, Horner was left with $475,009.23, a decline of over 80 percent from the account balance when Strong took control of the account less than 18 months earlier. In that time, Strong had traded more than 10,000 times in the account.
In May 2021, Horner sued Strong, alleging causes of action for fraud, breach of fiduciary duty, negligence, breach of contract, and financial elder abuse.
After a bench trial, the court found in favor of Horner on all causes of action except for fraud. In the court’s view, “what [Strong] did could only be described as having an escalating manic episode which led him to gamble with other people’s money” (fn. omitted), and even Strong’s own expert witness could not explain Strong’s trades. The court found Strong breached his duty of care because his “investment strategy did not seem to fall within the reasonable scope of a competent investment strategy. It was completely contrary to Mr. Horner’s stated investment objectives, reckless, violated his request to hold certain stocks, and at times did not make a lot of logical sense.” The court found Strong breached his contract with Horner, which required it to “ ‘supervise and direct the investments of the [a]ccount in
from Interactive Brokers, he held 40 shares of Amazon, 1,000 shares of Apple, 100 shares of Costco, and no shares of Visa. We take judicial notice of Apple’s 4-for-1 stock split on August 31, 2020. (Apple Inc., Current Report (Form 8-K) (July 30, 2020) exhibit 99.1 <https://www.sec.gov/Archives/edgar/data/320193/0000320193200 00060/a8-kexhibit991q3202062.htm> [as of Aug. 26, 2026].)
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accordance with the investment objectives of” Horner. Nevertheless, Strong’s conduct did not amount to fraud because there was no evidence of misrepresentation or an intent to defraud.
Finally, the court found that although Strong “did not take or retain any of . . . Horner’s property nor did he obtain any benefit from his actions,” he “ ‘wrongful[ly] used’ . . . Horner’s core holdings he was under contract to hold” by selling call options that forced Horner to sell the stocks Horner did not want sold when the price rose above a certain level.
The court found that Horner suffered $2,556,040.20 in damages, which the court calculated by comparing the actual balance in Horner’s account at the end of Strong’s management against the amount that would have been in the account if Strong had made no trades at all, but had simply left the account as he found it.3 The court concluded that because of the finding of financial elder abuse, Civil Code section 3345 allowed for an award of up to treble damages. Nevertheless, because Strong did not benefit from the mismanagement of Horner’s portfolio, nor did he target Horner because of his age, the court elected to award only double damages. The court found punitive damages were appropriate under Civil Code section 3294, subdivision (a) because Horner had shown by clear and convincing evidence that Strong’s actions were malicious, in that he acted “with a willful and conscious disregard of the rights or safety of” Horner, and oppressive, in that Strong engaged in “despicable conduct that
3 The court adjusted the amount of damages to account for Horner’s withdrawals from the account and Strong’s management fees.
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subjected . . . Horner to cruel and unjust hardship in conscious disregard of his rights.” The court decided not to impose any additional damages to avoid making Horner endure an additional phase of the trial, and in recognition that the enhanced financial elder abuse award already adequately punished Strong’s misconduct.
In addition to the $5,112,080.40 in doubled damages, the court awarded Horner $970,596 in prejudgment interest, resulting in a total award of $6,082,676.40. The trial court also awarded Horner $740,859.20 in attorney fees under section 15657.5, subdivision (a). Strong timely appealed.4
4 Strong’s notices of appeal include both the judgment and orders dated February 7, 2024, denying his motion for a new trial and his motion to vacate the judgment. “An order denying a motion for a new trial is not appealable; however, it is reviewable on appeal from the underlying judgment.” (Audish v. Macias (2024) 102 Cal.App.5th 740, 746, fn. 2.) Similarly, an order denying a motion to vacate a judgment is generally not appealable where it does not decide new issues and affirms the judgment’s validity; “ ‘otherwise, an appellant would receive “either two appeals from the same decision, or, if no timely appeal has been made, an unwarranted extension of time in which to bring the appeal.” ’ ” (311 South Spring Street Co. v. Department of General Services (2009) 178 Cal.App.4th 1009, 1014.) We do not further address the orders on the new trial and judgment vacatur motions as Strong makes no arguments concerning those orders distinct from the ones he makes regarding the judgment itself.
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DISCUSSION
A. The Trial Court Did Not Err by Finding Strong Committed Financial Elder Abuse Strong does not challenge the court’s findings on breach of contract, breach of fiduciary duty, or negligence, but he does contend the trial court erred by finding he committed financial elder abuse. Financial elder abuse is defined in section 15610.30, part of the Elder Abuse and Dependent Adult Civil Protection Act (§§ 15600-15675). “ ‘Financial abuse’ of an elder . . . occurs when a person” “[t]akes, secretes, appropriates, obtains, or retains real or personal property of an elder or dependent adult for a wrongful use or with intent to defraud, or both.” (§ 15610.30, subds. (a), (a)(1).) In the course of ruling on the elder abuse claim, the trial court found that Strong “did not take or retain any of . . . Horner’s property nor did he obtain any benefit from his actions.” Thus, Strong argues, he cannot be liable under the statute.
Strong’s suggestion notwithstanding, one cannot read the trial court’s statement to mean that the court made a legal conclusion that Strong did not “[t]ake[], secrete[], appropriate[], obtain[], or retain[] real or personal property of an elder” (§ 15610.30, subd. (a)(1)), as that would be inconsistent with the court’s finding that Strong was liable for financial elder abuse. The court began its analysis of the financial elder abuse claim by quoting section 15610.30 at length and citing the CACI instruction (CACI No. 3100) setting forth the elements a plaintiff must meet for a claim under that section. As the court noted (and here we quote its statement of decision), one of those elements is in the alternative: the plaintiff must show “that the defendant took or retained the property for a wrongful use or with the intent to defraud.” (Italics added.) In discussing this
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element, the court took the options in reverse order and first reiterated its finding that “there is insufficient evidence of an intent to defraud” because Strong “went down the same path of financial destruction with all of his clients’ holdings” and “did not take or retain any of . . . Horner’s property nor did he obtain any benefit from his actions.” The court then found liability based on the alternate ground that Strong took or retained Horner’s property for a wrongful use.
Thus, read in context it is clear the court’s statement on which Strong relies meant that Strong did not directly take or retain Horner’s money for himself, not that Strong did not take or retain Horner’s money for any purposes whatsoever. In that sense, the court’s statement is undisputed. Horner does not allege that Strong diverted or kept any of Horner’s assets. It is similarly undisputed that Horner gave his money to Strong to manage, and that Strong took that money, constructively retained it in an investment account Strong controlled, and made decisions about how Horner’s funds would be deployed. As the court set forth in the statement of decision, section 15610.30 states that “[f]or purposes of this section, a person or entity takes, secretes, appropriates, obtains, or retains real or personal property when an elder or dependent adult is deprived of any property right, including by means of an agreement, donative transfer, or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.” (Id., subd. (c), italics added.) In finding Strong liable for financial elder abuse, the court necessarily concluded that Strong was liable for financial elder abuse because he “deprived [Horner] of [a] property right.” (Ibid.)
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This broader definition of taking or depriving is crucial. As Horner aptly summarizes, it means that “[t]he focus of the [e]lder [a]buse statute is not on what the abuser gets; it is on what the elder loses.” Several cases have affirmed this interpretation. For example, in Mahan v. Charles W. Chan Ins. Agency, Inc. (2017) 14 Cal.App.5th 841, the court held that section 15610.30, subdivision (c) allows for liability for financial elder abuse even if the defendant did not take any property directly from the victim. The plaintiffs in Mahan alleged that the defendants wrongfully convinced them to sell their insurance policies and replace them with more expensive, less valuable policies. The court reasoned that because the complaint alleged that the defendants “steered the [plaintiffs] into transactions that, in effect, destroyed the value they intended to convey to their children when they chose [the original] insurance policies as their preferred form of gift asset, we think the [complaint] alleges a legally cognizable ‘depriv[ation]’ of a ‘property right’ under the language of section 15610.30, subdivision (c).” (Mahan, supra, at p. 862.) The court reasoned that “nothing in the text of the statute requir[es]” “that a deprivation must involve the direct taking by one person of the property of another.” (Id. at pp. 862, 861.)
The court in Ring v. Harmon (2021) 72 Cal.App.5th 844 likewise placed the emphasis on the loss by the victim rather than the gain by the defendant. In the court’s view, the key question was, “[d]id [the plaintiff] plead facts showing that she, in her individual capacity, has ‘any property right’ cognizable under section 15610.30, and was she deprived of it by respondents?” (Id. at p. 853, fn. omitted.) The defendants were alleged to have reduced the value of the plaintiff’s home by burdening it with additional debt, and the court concluded “[t]hat
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reduction in value alone is enough to support the conclusion that [the plaintiff], in her individual capacity, has been deprived of a cognizable property right.” (Id. at p. 855.) Similarly, in Bounds v. Superior Court (2014) 229 Cal.App.4th 468, the defendants argued they could not be liable for elder abuse because they did not obtain the plaintiff’s property—the sale of the plaintiff’s property was stopped while the transaction was in escrow. The court disagreed, reasoning that the plaintiff had stated a cause of action for financial elder abuse because the execution of escrow instructions impaired the plaintiff’s property rights by interfering with her right to dispose of the property to someone else. (Id. at pp. 479-480.) Finally, in Cameron v. Las Orchidias Properties, LLC (2022) 82 Cal.App.5th 481, the court held that the defendant committed elder abuse by denying the tenant’s effort to return to her former home. (Id. at pp. 507-510.) Through a combination of state and municipal law, the tenant was entitled to reinstitute her former tenancy at her previous rental rate after her landlord withdrew her home from the rental market, then sought to rerent it. (See id. at pp. 499-500.) In this case, as in the others, the focus was on the plaintiff’s loss of her property right rather than on what the defendant took.
Strong argues these cases are not dispositive because in each of them the deprivation of a property right “worked directly to the benefit of” the defendants. (Ring v. Harmon, supra, 72 Cal.App.5th at p. 856.) In Ring, the defendants received about $18,000 in fees from the $200,000 loan the plaintiff took out. (Id. at p. 849.) In Mahan, the defendants received commissions for selling the plaintiffs the disadvantageous insurance contracts. (Mahan v. Charles W. Chan Ins. Agency, Inc., supra, 14 Cal.App.5th at p. 865.) In Bounds, the defendants would have
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obtained the property at issue for what the plaintiff alleged was “ ‘a remarkable bargain price.’ ” (Bounds v. Superior Court, supra, 229 Cal.App.4th at p. 474.) In Cameron, the defendant landlord intended to rent the property to a different tenant on more favorable terms in the hope of increasing the value of the property. (Cameron v. Las Orchidias Properties, LLC, supra, 82 Cal.App.5th at p. 495.) In this case, by contrast, Strong’s compensation was based on the value of the assets he managed. When the value of Horner’s account decreased, Strong earned lower fees.
On the facts before us, we are not persuaded this distinction makes a difference. Although it is hardly surprising that most people who commit financial elder abuse do so for their own material benefit, nothing in the text of section 15610.30 implies that that must be their motivation. As Horner points out, if Strong’s theory was accepted, it would mean that a defendant who threw an elder’s property into a lit fireplace would not be liable for elder abuse because the defendant would have obtained no financial benefit. Strong objects that the defendant in that scenario would be liable despite the lack of financial benefit because it “would . . . constitute a direct and permanent taking of the elder’s property.” But we see no reason why a personal benefit is required for financial elder abuse to apply to an indirect taking; as with a direct taking, an indirect taking suffices so long as an elder “is deprived of [a] property right” (id., subd. (c)) as a result of the defendant’s action, as occurred here when Strong was given Horner’s portfolio and used it (in breach of his fiduciary duty) to engage in risky options trading that largely obliterated Horner’s savings. Although Strong did not gain financially by causing Horner to lose money, he had a financial
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incentive to take the actions he did. Unless it was essentially compulsive gambling, the only explanation for Strong’s increasingly desperate options trading appears to have been a desire to recover from the earlier losses in the hope of retaining Horner’s business, which would earn Strong greater fees from Horner in the future.5 “Where there is room for debate regarding the meaning of the statutory text of the [Elder Abuse and Dependent Adult Civil Protection] Act, it should be ‘ “liberally construed on behalf of the class of persons it is designed to protect,” ’ and in a manner compatible with its ‘overall remedial purpose.’ ” (Ring v. Harmon, supra, 72 Cal.App.5th at p. 853.) The purpose of the financial elder abuse statutes, of course, is to protect elders from financial predation. The court in Mahan reviewed the history of these laws, which showed a continuous expansion over the decades to encompass ever more forms of financial abuse. (See Mahan v. Charles W. Chan Ins. Agency, Inc., supra, 14 Cal.App.5th at pp. 858-860.)
Strong has provided us with the legislative history of Senate Bill No. 1140,6 the 2008 legislation that added subdivision (c) in its current form to section 15610.30, thus expanding the definition of “takes, secretes, appropriates, obtains, or retains
5 Horner’s trading activity grew as the losses mounted. In the portfolio report for the fourth quarter of 2019, the first full quarter under Strong’s management, the section detailing Strong’s trades is 20 pages long. The equivalent report for the third quarter of 2020, the last full quarter under Strong’s management, includes over 200 pages of trades.
6 We grant Strong’s request for judicial notice of these documents.
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real or personal property” to include situations “when an elder or dependent adult is deprived of any property right, including by means of an agreement, donative transfer, or testamentary bequest, regardless of whether the property is held directly or by a representative of an elder or dependent adult.” (Ibid.) Strong argues the purpose of this change was merely to allow for liability when a defendant takes property from a victim indirectly, by means of an agreement or donative transfer. That tells only part of the story. Prior to Senate Bill No. 1140, financial elder abuse required a showing that the defendant acted in bad faith. The new version of the law requires only that “the person . . . knew or should have known that [his] conduct is likely to be harmful to the elder or dependent adult.” (§ 15610.30, subd. (b).) Senate Bill No. 1140 also added undue influence as a basis of financial elder abuse and provided for awards of attorney’s fees. The legislative history contains no explanation of the inclusion of the phrase “is deprived of any property right” in the new version of section 15610.30, subdivision (c), but the language is consistent with the Legislature’s evident desire to expand seniors’ protection from financial abuse. Strong’s interpretation of the statute would be contrary to this purpose.
Strong raises additional objections to the trial court’s decision. He argues that a decrease in the value of an investment does not constitute taking an elder’s property right. But as the trial court noted, Strong did not merely cause a decrease in the value of an asset. Instead, his sales of call options directly resulted in the sale of shares of stock that Horner had instructed him not to sell, causing Horner financial losses.
Strong also argues he did not commit elder abuse because he treated Horner no differently than his younger clients, most of
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whom also lost money when Strong applied the same trading gambits to their accounts. Strong is correct that financial institutions do not owe special duties to customers who are over 65 years old. (Hilliard v. Harbour (2017) 12 Cal.App.5th 1006, 1015-1016.) In Hilliard, the plaintiff was the principal shareholder of a corporation that borrowed money from the defendant bank. The loan went into default, and the bank ultimately assigned it to a third party. (Id. at pp. 1008-1010.) The court held the plaintiff lacked standing to sue because the bank had taken action against the corporation, not the plaintiff himself. (Id. at p. 1015.) In dicta, the court expressed skepticism that the bank’s ordinary actions in seeking payment on its loan could constitute a tort simply because the customer was over age 65, noting “that ‘ “[i]t is simply not tortious for a commercial lender to lend money, take collateral, or to foreclose on collateral when a debt is not paid [because a] commercial lender is privileged to pursue its own economic interests and may properly assert its contractual rights.” ’ ” (Id. at p. 1016.) This does not imply that a defendant who does commit a tort against an elder— such as Strong’s breach of fiduciary duty—is not liable for financial elder abuse unless he intentionally targeted the victim because of his age. Strong cites no statute or case law suggesting otherwise, and we are aware of none. We recognize that not every wrong committed against someone who is over age 65 constitutes elder abuse. (Paslay v. State Farm General Ins. Co. (2016) 248 Cal.App.4th 639, 658.) But the court did not err in finding Strong liable here because he “reasonably should [have] be[en] aware of the harm[]” he caused by his breach of fiduciary duty. (Ibid.) Strong engaged in trading strategies involving the stocks Horner directed not be sold that caused those stocks to be
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sold, which the court found to be malicious, oppressive, and despicable conduct.7 B. Strong’s Challenges to the Amount of the Judgment Strong raises two additional arguments for the first time on appeal, one regarding the doubling of the compensatory damages award and one regarding the calculation of prejudgment interest. Horner argues we should deem these arguments forfeited and disregard them; he makes no attempt to defend the merits of the trial court’s decisions on these two issues. We reach different conclusions with respect to these claims, as we now explain.
1. Strong Forfeited His Objection to the Doubling of Damages
The first claim of forfeiture applies to Strong’s argument that the trial court erred by awarding Horner double damages under Civil Code section 3345. From the outset, Horner pursued two separate theories to obtain an award in excess of compensatory damages. First, he sought punitive damages under Civil Code section 3294, which provides that “[i]n an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.” (Id., subd. (a).) Second, Horner sought damages under Civil Code
7 Strong argues that if we reverse the court’s finding that he committed financial elder abuse we must also reverse the order awarding Horner attorney’s fees. Because we reject Strong’s arguments on financial elder abuse, we likewise reject his claim regarding attorney’s fees.
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section 3345, which allows trial courts to award up to treble damages in actions brought by senior citizens “to redress unfair or deceptive acts or practices or unfair methods of competition.” (Id., subd. (a).)
Horner mentioned both of these theories in his complaint, trial brief, opening statement at trial, and post-trial closing briefs. In almost every instance, and especially in the post-trial briefing, Horner presented treble damages under Civil Code section 3345 and punitive damages under Civil Code section 3294 as alternative methods for reaching a similar result. In his final post-trial brief, Horner wrote, “With the right to treble damages under [Civil Code s]ection 3345 undisputed, the [c]ourt can either award additional damages under that statute or schedule a [p]hase [two] hearing to consider the imposition of punitive damages under [Civil Code s]ection 3294. But Strong absolutely should be punished.”
In its proposed statement of decision, the trial court awarded Horner additional damages under both theories, including double damages under Civil Code section 3345 and $3 million more in punitive damages under Civil Code section 3294. The court invited the parties to submit their objections to the proposed statement of decision, and Strong objected to the punitive damages on the ground that Horner had produced no evidence of Strong’s financial condition, which is required for an award of punitive damages. Strong did not argue that Civil Code section 3345 does not apply to the type of damages the court indicated it intended to award Horner.
In response to Strong’s objections, Horner proposed that the court do one of two things: (1) amend the statement of decision to eliminate the $3 million punitive damages award, and
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instead to award treble damages under Civil Code section 3345, with the goal of avoiding a phase two trial on Strong’s ability to pay because of “Horner’s advanced age”; or (2) award double damages under Civil Code section 3345 and conduct a phase two trial on punitive damages. In its final statement of decision, the trial court awarded double damages under Civil Code section 3345, but it eliminated the punitive damages award in order “not to further prolong proceedings with a [p]hase [two] punitive damages trial.” The court reasoned that “[t]he findings of malicious and oppressive conduct are adequately addressed by the enhanced financial elder abuse award.”
In his opening appellate brief, Strong makes arguments for the first time that the damages awarded to Horner in this case were not subject to augmentation under Civil Code section 3345. The statute applies to actions brought by senior citizens “to redress unfair or deceptive acts or practices or unfair methods of competition” (id., subd. (a)), but it allows an increase in the amount of “a fine, or a civil penalty or other penalty, or any other remedy the purpose or effect of which is to punish or deter” (id., subd. (b), italics added). Our Supreme Court has held that treble damages apply “only if the statute under which recovery is sought permits a remedy that is in the nature of a penalty.” (Clark v. Superior Court (2010) 50 Cal.4th 605, 614.) Because the trial court awarded Horner compensatory damages based on the amount of the loss Strong caused (see § 15657.5, subd. (a)), Strong argues the trial court lacked authority to award increased damages under Civil Code section 3345. Strong further contends that Civil Code section 3345 requires that a defendant direct their conduct at senior citizens, which he did not.
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The defendants acknowledge that they failed to raise these issues before the trial court,8 but they argue we should overlook the forfeiture because this is a purely legal question, the underlying facts are undisputed, and it is an issue of first impression. (See De Anza Santa Cruz Mobile Estates Homeowners Assn. v. De Anza Santa Cruz Mobile Estates (2001) 94 Cal.App.4th 890, 906-908.) We decline to exercise our discretion to decide this question on the merits because of the obvious prejudice it would impose on Horner. As just explained, Horner pursued additional damages along two parallel paths: Civil Code sections 3294 and 3345. The record regarding punitive damages under Civil Code section 3294 remains undeveloped because the court found the doubling of damages under Civil Code section 3345 (which resulted in an award approximately $2.5 million above and beyond compensatory damages) sufficiently punished Strong such that a punitive damages phase was not necessary, and Horner decided that he was satisfied with that outcome and did not press his punitive damages claim further (either with the trial court, or by
8 Strong did object to the award of double damages before the trial court on a different ground. Civil Code section 3345 applies in actions “to redress unfair or deceptive acts or practices or unfair methods of competition” (id., subd. (a)), and Strong argued that the trial court had not found he engaged in those kinds of practices. He reasserts this claim on appeal, but we disagree. Although the trial court did not use the phrase “deceptive acts or practices” in its statement of decision, it is implicit in the court’s finding that Strong agreed not to sell certain stocks from Horner’s portfolio but then entered into options trades that required those shares to be sold. That conduct qualifies.
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appealing after the final statement of decision), expressly noting his advanced age. To reverse the award under Civil Code section 3345 at this late stage would pull the rug out from under Horner, who is even more elderly now than when the court decided (without objection) that a punitive damages phase was not necessary because of the double damages.
2. The Award of Prejudgment Interest Must be Reduced Horner also asserts Strong forfeited his objection to the trial court’s award of prejudgment interest. Civil Code section 3288 allows courts to award prejudgment interest “[i]n an action for the breach of an obligation not arising from contract, and in every case of oppression, fraud, or malice.” Our Supreme Court has held that interest under this statute is available only for economic losses resulting from the defendant’s tortious deprivation of the plaintiff’s property: “The award of such interest represents the accretion of wealth which money or particular property could have produced during a period of loss.” (Greater Westchester Homeowners Assn. v. City of Los Angeles (1979) 26 Cal.3d 86, 102-103.) This restriction applies even where the defendant’s damages are based on malice, fraud or oppression. (See Nordahl v. Department of Real Estate (1975) 48 Cal.App.3d 657, 665 [“When, by virtue of the fraud or breach of fiduciary duty of the defendant, a plaintiff has been deprived of the use of his money or property and is obliged to resort to litigation to recover it, the inclusion of interest in the award is necessary in order to make the plaintiff whole”].) In a similar context, our Supreme Court has held that prejudgment interest for personal injury under Civil Code section 3291 does not apply to punitive damages. (Lakin v. Watkins Associated Industries (1993) 6 Cal.4th 644, 662.)
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Strong is correct that the trial court erred by awarding prejudgment interest on the entire damages award, rather than only the portion attributable to economic damages. In this instance, the case for enforcing the forfeiture rule is weaker. This is a purely legal issue, the calculation is straightforward, and correcting the amount of interest will not result in further proceedings or prejudice distinct from the correction. Because interest is available on only the one-half of the award attributable to compensatory damages ($2,556,040.20 instead of $5,112,080.40), as Horner himself recognized in the calculation he provided to the court, the amount of interest must be cut in half, from $970,596 to $485,298.
We do not agree with Horner that Strong invited the error.
Horner is correct that it was Strong who initially proposed that the aggregate award to Horner should be $6,082,676.40, which implicitly included $970,596 in prejudgment interest. But Strong did so in the context of Horner’s effort to obtain a much higher award. The failure to seek a reduction in the amount of prejudgment interest appears to have been an oversight rather than an attempt to take advantage of the court’s error. In addition, as just mentioned, Horner’s posttrial briefing requested interest only on the base compensatory damages award. The award of prejudgment interest on the entire award appeared for the first time in the trial court’s final statement of decision. Although it would have been preferable for Strong to have called the error to the attention of the trial court, no sufficient reason exists for us not to correct it now.
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DISPOSITION
The amount of prejudgment interest is reduced from $970,596 to $485,298, and the trial court is directed to issue an amended judgment reflecting that reduction. The judgment is otherwise affirmed, as is the order awarding attorney’s fees. Respondents are awarded their costs on appeal.
NOT TO BE PUBLISHED
WEINGART, J.
We concur:
ROTHSCHILD, P. J.
M. KIM, J.