PCO, Inc. v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro

58 Cal. Rptr. 3d 516, 150 Cal. App. 4th 384, 2007 Cal. Daily Op. Serv. 4776, 2007 Cal. App. LEXIS 667
CourtCalifornia Court of Appeal
DecidedApril 30, 2007
DocketB189856
StatusPublished
Cited by78 cases

This text of 58 Cal. Rptr. 3d 516 (PCO, Inc. v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
PCO, Inc. v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, 58 Cal. Rptr. 3d 516, 150 Cal. App. 4th 384, 2007 Cal. Daily Op. Serv. 4776, 2007 Cal. App. LEXIS 667 (Cal. Ct. App. 2007).

Opinion

*388 Opinion

MOSK, J.

INTRODUCTION

Plaintiffs PCO, Inc., and Personal Choice Opportunities, by and through their duly appointed receiver, Barry A,. Fisher (plaintiffs), filed an action against Robert L. Shapiro (Shapiro) and his law firm, Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro, LLP (Christensen Firm), alleging that Shapiro improperly obtained monies that belonged to the receivership. Shapiro, a named partner in the Christensen Firm, was the attorney for David W. Laing (Laing), who was arrested and ultimately convicted for engaging in fraudulent activities with PCO, Inc., and Personal Choice Opportunities (collectively PCO).

The trial court granted the Christensen Firm’s motion for summary judgment on the ground that the Christensen Firm cannot be held vicariously liable for Shapiro’s alléged acts. We reverse the summary judgment, holding that plaintiffs have raised triable issues of fact with respect to whether Shapiro committed his alleged acts within the scope of his authority as a partner of the Christensen Firm. We affirm, however, the trial court’s order granting summary adjudication in favor of the Christensen Firm on plaintiffs’ causes of action for conversion and breach of fiduciary duty.

BACKGROUND 1

Plaintiffs alleged in their third amended complaint that PCO purported to be in the business of investing in viatical settlements, 2 but that, in fact, PCO never purchased any viatical settlements even though Laing, operating through PCO, obtained over $89 million in loans from investors for that purpose. Plaintiffs alleged that Laing was arrested and charged with various federal offenses in connection with PCO arid ultimately pleaded guilty to certain charges. Plaintiffs further alleged that Shapiro and the Christensen *389 Firm 3 appeared as Laing’s counsel of record in federal criminal proceedings; Shapiro, acting for himself and as the agent of the Christensen Firm, directed a group of those associated with Laing to go to Laing’s residence in Palm Springs, California, and there to obtain 12 duffel bags, each containing $500,000 in cash that Shapiro knew or should have known had been unlawfully obtained; Laing’s associates converted 10 of those bags of money; and some of that money was used to post bail for Laing and to pay the fees of Shapiro and the Christensen Firm. Plaintiffs alleged that the money belonged to the receivership, and asserted causes of action for conversion, breach of fiduciary duty, money had and received, violation of Business and Professions Code section 17200 et seq. (fraudulent practice), violation of Government Code section 13975.1 (receiver recovery of monies unlawfully obtained), and violation of Civil Code section 3439.04 et seq. (fraudulent transfers).

Shapiro was a nonequity partner in the Christensen Firm. He did not share in the profits or losses of the Christensen Firm. (See Rosenman v. Christensen, Miller, Fink, Jacobs, Glaser, Weil & Shapiro (2001) 91 Cal.App.4th 859, 862 [110 Cal.Rptr.2d 903] [reference to nonequity partners in that firm].) 4 He asserted that he maintained his criminal law practice separate and apart from the Christensen Firm,' and that he received the monies as part of his representation of Laing and deposited the monies in his personal account— not the account of the Christensen Firm. Plaintiffs submitted evidence, including correspondence and records of court appearances, indicating that Shapiro acted on behalf of the Christensen Firm in representing Laing.

Shapiro and the Christensen Firm brought a joint motion for summary judgment or, in the alternative, summary adjudication, attacking each of plaintiffs’ claims. The Christensen Firm also brought a second motion for summary judgment, arguing, inter alia, that the Christensen Firm cannot be held vicariously liable for Shapiro’s conduct.

*390 On the first motion, the trial court granted summary adjudication in favor of the Christensen Firm as to plaintiffs’ claims for conversion and breach of fiduciary duty. On the second motion, the trial court granted summary judgment in favor of the Christensen Firm. The trial court entered judgment in favor of the Christensen Firm. Plaintiffs timely appealed. 5

DISCUSSION

A. Standard of Review

We review the grant of summary judgment de novo and therefore make, an independent assessment of the correctness of the trial court’s ruling, applying the same legal standard as the trial court in determining whether there are any genuine issues of material fact or whether the moving party is entitled to judgment as a matter of law. A defendant moving for summary judgment meets its burden of showing that there is no merit to a cause of action by showing that one or more elements of the cause of action cannot be established or that there is a complete defense to that cause of action. Once the defendant has made such a showing, the burden shifts back to the plaintiff to show that a triable issue of one or more material facts exists as to that cause of action or as to a defense to the cause of action. (Code Civ. Proc., § 437c, subd. (p)(2); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 849, 853-854, 860 [107 Cal.Rptr.2d 841, 24 P.3d 493] (Aguilar); Interinsurance Exchange of the Automobile Club v. Superior Court (2007) 148 Cal.App.4th 1218, 1226-1228 [56 Cal.Rptr.3d 421]; Moser v. Ratinoff (2003) 105 Cal.App.4th 1211, 1216-1217 [130 Cal.Rptr.2d 198].)

B. Plaintiffs Raised a Triable Issue of Fact Regarding the Christensen Firm’s Vicarious Liability for Shapiro’s Alleged Acts

The trial court granted the Christensen Firm’s motion for summary judgment on the ground that Shapiro acted outside the scope of his authority as a partner of the Christensen Firm when he participated in the removal and use of cash from Laing’s residence. The trial court erred in doing so. Based on the evidence presented, a “reasonable trier of fact’ (Aguilar, supra, 25 Cal.4th at p. 856) could find that Shapiro acted in his capacity as a member of the Christensen Firm and at a client’s request to protect the funds from which the client’s bail and the Christensen Firm’s legal fees would be paid. Helping a client arrange bail and ensuring the payment of his firm’s fees is within the scope of a law partner’s authority.

*391 A law partnership, as any partnership, is vicariously liable “for loss or injury caused to a person, or for a penalty incurred, as a result of a wrongful act or omission, or other actionable conduct, of a partner acting in the ordinary course of business of the partnership or with authority of the partnership.” (Corp. Code, § 16305, subd. (a); see Blackmon v. Hale (1970) 1 Cal.3d 548, 557 [83 Cal.Rptr. 194, 463 P.2d 418

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58 Cal. Rptr. 3d 516, 150 Cal. App. 4th 384, 2007 Cal. Daily Op. Serv. 4776, 2007 Cal. App. LEXIS 667, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pco-inc-v-christensen-miller-fink-jacobs-glaser-weil-shapiro-calctapp-2007.