In Wise v. DLA Piper LLP (D062150, D062661 Oct. 8, 2013), the Fourth Appellate District, Division One reversed a malpractice judgment following a jury verdict against the law firm DLA Piper LLP. Justice Alex C. McDonald wrote the court’s opinion.
DLA Piper’s predecessor in interest represented Dennis and Joan Wise in obtaining a judgment against William Cheng in 1994. DLA Piper did not advise the Wises of the need to renew the judgment every ten years to avoid expiration. The judgment expired in 2004 and the Wises sued DLA Piper for legal malpractice. In the ensuing trial and again on appeal the critical issue was the collectibility of the judgment. DLA Piper argued that if Chen was insolvent, legal malpractice could not be established. The Wises retained a collections attorney to testify as an expert witness on collectibility. The expert testified that Cheng could have satisfied a judgment.
Although the facts of the case were unremarkable. The decision is notable for three reasons.
First, it reaffirms that in proving a malpractice case premised on the mishandling of a client’s claim, the plaintiff must prove that proper handling of the claim would have actually resulted in a collection against the debtor. Put differently, if the attorneys accused of malpractice prove that the debtor was insolvent and unable to satisfy any judgment, a malpractice claim will not lie.
Second, the critical issue in Wise came down to the collectibility of the Wises’ claim against Cheng. In evaluating the evidence of collectibility, the Court of Appeal applied the extremely deferential standard known as “substantial evidence.” Under this standard, reversals are extremely rare. Using this standard, the evidence at trial is reviewed by resolving all conflicts in the evidence in support of the judgment. The testimony of a single witness is normally sufficient to support the judgment on appeal. As described by one court:
“[W]e are bound by the rule that when ‘a finding of fact is attacked on the ground that there is not any substantial evidence to sustain it, the power of an appellate court begins and ends with the determination as to whether there is any substantial evidence contradicted or uncontradicted which will support the finding of fact.’ [Citations.]” (Gray v. Don Miller & Associates, Inc. (1984) 35 Cal.3d 498, 503, 198 Cal.Rptr. 551, 674 P.2d 253.) Defendants raising a claim of insufficiency of the evidence assumes a “daunting burden.”
(Whiteley v. Philip Morris Inc. (2004) 117 Cal.App.4th 635, 678)
Even under this “daunting burden” DLA Piper’s appellate counsel was able on appeal to overturn the judgment by effectively attacking the expert opinion offered by the Wises as failing to rise to the dignity of substantial evidence.
Third, some of the court’s comments suggest that the Wises would have been better served by retaining appellate counsel for the appeal. One of the arguments raised by the Wises on appeal rested on a declaration that was not in the appellate record. Referring to matters outside the record on appeal violates a well established rule on appeal. Another argument raised by DLA Piper on appeal was not opposed by the Wises by either argument or legal authority and, therefore, the court deemed the Wises to have conceded the point on appeal. Finally, the court found that the Wises’ collectibility expert’s opinion rested on “speculation, factual assumptions unsupported by the record, or fallacious legal assumptions.” In contrast to these failings, the court noted that DLA’s appellate brief “convincingly argued” an issue. Taken together, these comments suggest that in some instances retaining appellate counsel can make a difference in the outcome of an appeal. A skilled appellate attorney can examine the record before the briefs are written to ensure that all documents necessary for the appeal are included in the appellate record. An appellate attorney can also carefully consider the arguments raised in opposing briefs to ensure that issues are not unnecessarily waived or conceded by omission.