Viner v. Sweet

12 Cal. Rptr. 3d 533, 117 Cal. App. 4th 1218, 2004 Daily Journal DAR 4963, 2004 Cal. Daily Op. Serv. 3533, 2004 Cal. App. LEXIS 600
CourtCalifornia Court of Appeal
DecidedApril 23, 2004
DocketB138149
StatusPublished
Cited by22 cases

This text of 12 Cal. Rptr. 3d 533 (Viner v. Sweet) 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
Viner v. Sweet, 12 Cal. Rptr. 3d 533, 117 Cal. App. 4th 1218, 2004 Daily Journal DAR 4963, 2004 Cal. Daily Op. Serv. 3533, 2004 Cal. App. LEXIS 600 (Cal. Ct. App. 2004).

Opinions

[1221]*1221Opinion

PERLUSS, P. J.

In our initial decision in this case (Viner v. Sweet (Sept. 28, 2001, B138149) [superseded by grant of review Dec. 19, 2001 (S101964)] (Viner I)), we held to establish causation in fact the plaintiffs in a transactional legal malpractice action are not required to prove the opposing side in contract negotiations would have given them a better deal than they actually obtained had their attorney not been negligent and affirmed most of the jury’s multimillion dollar damage award in favor of plaintiffs Michael Viner and Deborah Raffin Viner. The Supreme Court reversed, holding “just as in litigation malpractice actions, a plaintiff in a transactional malpractice action must show that but for the alleged malpractice, it is more likely than not that the plaintiff would have obtained a more favorable result.” (Viner v. Sweet (2003) 30 Cal.4th 1232, 1244 [135 Cal.Rptr.2d 629, 70 P.3d 1046] (Viner II).) The Court remanded the matter “for proceedings consistent with the views expressed here.” (Ibid.)

Having received supplemental briefing after remand and heard further oral argument from the parties, we now conclude the trial court erred in denying the defendant lawyers’ motion for judgment notwithstanding the verdict as to five of the seven claims of malpractice asserted against them. Accordingly, we modify the judgment by reducing the award of damages from $13,291,532 to $515,760 and, as so modified, affirm the judgment.

FACTUAL AND PROCEDURAL BACKGROUND

The Viners1 sued their former attorneys, Charles A. Sweet and his law firm Williams & Connolly (collectively W&C), for negligently negotiating and drafting agreements for the sale of their ownership interest in Dove Audio, Inc. (Dove) to Media Equities International (MEI) and termination of their employment with Dove. Under the terms of the agreements as drafted, MEI purchased a significant portion of the Viners’ Dove stock for more than $3 million, and the Viners’ were to receive $1.5 million from Dove over five years in monthly installments. Dove’s series “E” preferred stock was to be held in escrow for distribution to the Viners if Dove defaulted on the monthly payments to them.2

The Viners’ professional negligence cause of action identified seven acts of malpractice: (1) W&C told the Viners the nonsolicitation clause in the employment termination agreement applied only to the book and audiobook [1222]*1222segments of Dove’s business, but because the clause was ambiguous, Dove successfully asserted in arbitration that the clause also encompassed Dove’s television and motion picture projects; (2) W&C negligently agreed to a noncompetition provision, which violated Business and Professions Code section 16600’s restrictions on such provisions; (3) the employment termination agreement provided for attorney fees only in enforcing an arbitration award; (4) ambiguous language in the provision relating to producer credit caused Dove not to give Deborah Baffin Viner credit as a producer; (5) by virtue of the general release language in the employment termination agreement, the Viners lost their rights to accrued dividends on Dove’s series “A” preferred stock; (6) the employment termination agreement did not contain an indemnity provision providing the same level of protection as the Viners had in their employment agreement; and (7) the series “E” preferred stock afforded inadequate security to the Viners if Dove defaulted on the monthly payments due under the employment termination agreement.

Following a four-week trial, the jury returned a special verdict in favor of the Viners on each of the seven claims of negligence, awarding the Viners a total of $13,291,532 in damages. The trial court denied W&C’s motion for judgment notwithstanding the verdict in which W&C argued (among other grounds asserted) the Viners had failed to prove the requisite causal connection between W&C’s negligent conduct and the damages allegedly resulting from that negligence.

W&C appealed the judgment, arguing with respect to five of the seven claims for negligence that the Viners failed to present substantial evidence, as they were required to do, that a better result would have been obtained absent W&C’s claimed negligence. Alternatively, even if such proof had been presented, W&C argued a new trial would be required because the trial court failed to properly instruct the jury on the necessary proof of causation in a legal malpractice action—that is, that the Viners were required to demonstrate that proper handling of their matter by W&C would have resulted in a more favorable outcome.3

We affirmed the judgment as modified, holding that the Viners were not required to prove they would have obtained a more favorable result in the [1223]*1223transaction with MEI if W&C had not been negligent. Applying what we described as “ordinary negligence and causation principles,” we held the evidence at trial supported the jury’s finding that W&C’s negligence was a substantial factor in causing the Viners to suffer a loss or diminution of their rights and remedies with respect to each of seven separate claimed items of mal practice and affirmed $8,065,732 of the jury’s damage award.* **4

The Supreme Court granted review, limited to the issue “whether the plaintiff in a transactional legal malpractice action must prove a more favorable result would have been obtained but for the alleged negligence.” (Viner II, supra, 30 Cal.4th at pp. 1238-1239, italics omitted.) The Court answered that question “yes”: “The Court of Appeal here held that a plaintiff suing an attorney for transactional malpractice need not show that the harm would not have occurred in the absence of the attorney’s negligence. We disagree. We see nothing distinctive about transactional malpractice that would justify a relaxation of, or departure from, the well-established requirement in negligence cases that the plaintiff establish causation by showing either (1) but for the negligence, the harm would not have occurred, or (2) the negligence was a concurrent independent cause of the harm.” (Viner II, supra, 30 Cal.4th at pp. 1240-1241.) The court explained, “In both litigation and transactional malpractice cases, the crucial causation inquiry is what would have happened if the defendant attorney had not been negligent. This is so because the very idea of causation necessarily involves comparing historical events to a hypothetical alternative. [Citations.]” (Id. at p. 1242.) The court reversed our judgment and returned the case to us for further proceedings consistent with its opinion. (Id. at p. 1244.)

CONTENTIONS

Applying the standard for proof of causation in fact in a transactional malpractice case confirmed by the Supreme Court in Viner II, W&C contends the Viners failed to present substantial evidence of causation as to five of their seven claims for malpractice and, because the Viners had a full and fair opportunity to prove their case at trial, the matter should be remanded to the trial court with directions to enter final judgment for the Viners as to the remaining two claims only. The Viners, on the other hand, contend they satisfied the causation standard articulated in Viner II as to all seven of their [1224]

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12 Cal. Rptr. 3d 533, 117 Cal. App. 4th 1218, 2004 Daily Journal DAR 4963, 2004 Cal. Daily Op. Serv. 3533, 2004 Cal. App. LEXIS 600, Counsel Stack Legal Research, https://law.counselstack.com/opinion/viner-v-sweet-calctapp-2004.