meet & greet the candidates wed, may 4, 2016 | 5 … · thing like qwertyuiop.” this may seem...
TRANSCRIPT
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The Marin Lawyer
See page 15 for details & more events.
President’s Message ........................ 2The ABC’s of ESI .......................... 4 Marin Community Court................. 6Superior Court Rule Changes ......... 7Director Spotlight ............................ 8Law Library Trustees ...................... 8Integrative Mediation ...................... 9Post-Judgement Interest ................ 10Insurance Policy Appraisal ........... 11Wine & Craft Beer Industry .......... 12In Memoriam: Vic Obinsky .......... 14New Members ............................... 14Calendar Details ............................ 15Marketplace ................................... 16
An Official Publication of the Marin County Bar Association
April 2016 Volume 47, Issue 4
Calendar of Events
In This Issue
The Marin Lawyer editorial team thanks April Guest Editor Rodrigo Dias.
MCBA MEMBERS LUNCHEONWED, APRIL 27, 2016 | 12-1:30 PM
Judicial Candidates Forum 2016 Marin Superior Court Election
Moderated by Larry Strick, MCBA President
Embassy Suites Buffet Lunch
$45 MCBA members / $50 nonmembersDetails & Registration
MEET & GREET THE CANDIDATESWED, MAY 4, 2016 | 5-7:00 PM
Mixer for Marin County Judicial CandidatesSponsored by the Marin County Women Lawyers
Terrapin Crossroads No host bar
RSVP: [email protected] | More Info
SAVE THE DATETHU, MAY 19, 2016 | 5:30 PM
Induction Ceremony for The Honorable Stephen Freccero Invitations will follow
Tues, April 12: 12:00 – 1:30 PMLabor & Employment Section Meeting
Thurs, April 14: 12:00 – 1:30 PMReal Estate Section Meeting
Tues., April 19, 2016: 12:00 – 1:00 PMFamily Law Section Meeting
Wed, April 20: 12:00 – 1:30 PMADR Section Meeting
Wed, April 20: 12:00 – 1:30 PMProbate & Estate Planning Section Meeting
Wed, April 27: 12:00 – 1:30 PMApril Members LunchForum: Candidates for Marin Superior Court Judge
SAVE THE DATEWed, May 25: 11:45 AM – 1:30 PMMCBA Members LuncheonSpeaker & Venue TBA
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The Marin Lawyer
President’s MessageBy Larry Strick
As many of you know, Judge Faye D’Opal announced that she will retire from the Bench at the end of the year. I want to join what I suspect will be a growing chorus singing praises and thanks to Judge D’Opal for her years of service to the people of Marin and the State of
California. Her work on the Bench has been stellar and she has been the model of everything that stands for justice: fairness, integrity and compassion. On behalf of the entire Marin County Bar Association, we thank her for all she has accomplished on behalf of the administration of justice.
Judge D’Opal’s anticipated retirement from the Court presents a rare opportunity for a County-wide election to determine her replacement. Open judicial races are a rarity. The last open race was in 2004. It’s no wonder there are quite a few folks who have announced their candidacy. The number and diversity of candidates is a great testament to the quality lawyers who seek to fill Judge D Opal’s seat.
MCBA is pleased to announce that it will hold a Ju-dicial Candidates Forum on April 27. We have invited the candidates to our General Membership Meeting. Each candidate will introduce him/herself, provide a window into their judicial philosophy, and make a pitch for your vote. The discussion promises to be lively and we are expecting a great turn out. Get your tickets early.
Also at the April Meeting, we will acknowledge Administrative Professionals Day. We have reached out to the Marin County Legal Professionals Association and several of their members will be in attendance. Please invite your administrative staff to join us so we may acknowledge the hard working legal professionals in the county.
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The Marin Lawyer
MCBA MEMBERS LUNCHEONWED, APRIL 27, 2016 | 12-1:30 PM
Judicial Candidates Forum 2016 Marin Superior Court Election
Moderated by Larry Strick, MCBA President
The Honorable Faye D’Opal will step down in December presenting a rare opportunity for a judicial election; the last open race was in 2004. This year’s election has attracted 9 qualified candidates. Hear directly from the candidates about why they are qualified
and what each will bring to the bench.
Otis Bruce, Jr.www.otisbruce4judge.com
Mike Coffinowww.CoffinoForJudge.com
Beth Jordanwww.jordanforjudge.com
Sheila Lichtblauwww.sheilaforjudge.com/sheila
Renee Marcellewww.marcelleforjudge.com
Thomas McAllister
Nancy McCarthywww.mccarthyformarinjudge.com
Nicole Pantaleowww.pantaleoforjudge.com
David Shane
Embassy Suites Buffet Lunch
$45 MCBA members / $50 nonmembersDetails & Registration
MEET & GREET THE CANDIDATESWED, MAY 4, 2016 | 5-7:00 PM
Mixer for Marin County Judicial CandidatesSponsored by Marin County Women Lawyers
A chance to chat with the candidates in an informal setting.
Terrapin Crossroads No host bar
More InfoRSVP: [email protected]
4
The Marin Lawyer
(Continued on page 5)
The ABC’s of ESIBy Matt Haulk
In 1971, Ray Tomlinson wrote the first e-mail consisting of “some-thing like QWERTYUIOP.” This may seem like high prose compared to e-mail today (a laughing “emoji” was the Oxford English Diction-
ary’s 2015 word of the year1), but what we have lost in quality, we have more than made up for in quantity.
Most people, and most businesses, have moved from the file cabinet to the “cloud”, and text messages and e-mails dominate our everyday communications. This digital migra-tion, coupled with nearly free memory, means that while Electronically Stored Information (“ESI”) may be archived, it is never truly forgotten.
The rules of ESI are complex and convoluted, but a foundational strategy for dealing with ESI can be boiled down to three points, the “ABC’s of ESI.”
Abide By Your Ethical Duties.Ignorance is not a defense. In July 2015, the State Bar
issued a formal opinion that attorneys owe their clients a duty of competence in managing ESI and E-Discovery. A failure to gain or maintain competence not only jeopardizes a case, but it also can lead to violations of an attorney’s separate duty of confidentiality.2
At the outset of any case, an attorney must evaluate whether ESI and e-discovery are issues, and if so, how to best preserve and manage ESI during litigation. For example, ask yourself what role e-discovery will play a role in the case, how your client stores its ESI, the most efficient method to collect and preserve ESI, and whether there are third-parties with important ESI.
For “simple” ESI issues, e.g., searching a single per-son’s e-mail account, this process can be handled with an exchange of letters, or during the required meet and confer process before the initial case management conference.3
For other cases, the complexity of ESI will require the retention of a technical consultant. For example, a con-struction dispute that requires the production of employee e-mails and project records over the course of a multi-year project, or a commercial dispute involving multi-region sales and revenue data regarding multiple lines of products.
These types of complex ESI issues require technical assistance to ensure that all discoverable information is captured, and that privileged information is not produced. This is important when there are “metadata” issues. Meta-data is the information about ESI itself, such as whether a particular e-mail was received, when it was received,
whether it was opened, and who opened it. Metadata is only accessible when the ESI (e.g. the e-mail) is produced in a certain format, an issue requiring special attention.
As with any consultant, counsel should exercise a proper supervisory role and review all ESI before it is produced. Privileged information cannot always be “clawed back” based on inadvertent disclosure, and a lack of reasonable care to protect ESI may be deemed a waiver of privilege.4
Be Proactive in Preserving Evidence.Attorneys should identify sources of ESI early, and
act quickly to preserve them. Often, this means issuing a series of litigation “hold” and litigation “freeze” directives.
A litigation hold directive is a letter to a client’s “custo-dians of records”, that is, the client’s employees, agents, or other affiliated third-parties who hold potentially valuable ESI. The litigation hold directive instructs these custodi-ans to maintain the ESI they have on a certain subject, for example, instructing them not to delete any e-mails, text messages, or other commercial records. A litigation freeze directive is a letter issued to an opposing party, instructing it to preserve ESI during the litigation.
California courts differ on a party’s pre-litigation duty to preserve evidence. Some Courts have authorized
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Monty White LLP is a nine-attorney firm with offices in San Rafael and Santa Rosa. Practice areas include personal injury, construction, estate planning, real estate, land use, nonprof-it law, immigration, elder law, general civil litigation, and family law.
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The Marin Lawyer
discovery sanctions for spoliation without pending dis-covery requests;5 others have held that sanctions are only authorized if evidence is destroyed after a discovery request is served.6
Regardless, absent exceptional circumstances, a party cannot be sanctioned for destroying or altering ESI in the routine, good faith operation of an organization’s ESI sys-tem, making litigation hold and freeze directives all the more important.7
Of course, there are jury instructions on the willful suppression of evidence and motions in limine can have a palliative effect, but these are cold-comfort when critical evidence has been destroyed. The best way to assure evi-dence is preserved (or to bolster future motions in limine) is to identify sources of ESI at the outset, and to take im-mediate steps to preserve them.
Consider the Costs.The costs of discovery are high; the costs of e-dis-
covery can be astronomical.8 Even without attorney’s fees, extracting, compiling, and transmitting ESI can quickly tip the cost-benefit analysis in small and even mid-size actions. The general rule in discovery is that the responding party bears the expense involved in responding to discovery requests.9
The California Legislature has made an exception for e-discovery. CCP section 2031.280(e), which governs responses to requests for production, states that, “if neces-sary, the responding party at the reasonable expense of the demanding party shall, through detection devices, translate any data compilations included in the demand into reason-ably usable form.”
In other words, if a litigant demands inaccessible ESI, he or she must pay the reasonable expenses of translating and converting the ESI into a reasonably usable form. In Toshiba America Electronics, the plaintiff demanded (among other information) e-mails from between 1994 and 2002, which were stored with other data on electronic back-up tapes. The cost involved in producing all of the data from these tapes was an estimated $1,900,000.
The Court of Appeal ruled that the demanding party bears the costs of translating ESI into a usable form, and that the responding party does not need to show undue bur-den or expense to trigger this “cost-shifting” mechanism. However, the Court of Appeal left the trial court with much more difficult questions to resolve, i.e., whether e-mails are “data compilations”, and whether the demanding party can simply procure the backup tapes and do the work itself to avoid cost-shifting.10
For the foreseeable future, resolving cost-shifting disputes will focus on the fact intensive issues of whether
a particular form of ESI is a “data compilation”, whether translation is “necessary”, and whether the costs are “rea-sonable.” Given the heightened costs at play, litigators should meet early and meet often to narrow requests and formulate a reasonable cost-sharing plan.
ConclusionWhich cases involve ESI? According to the State Bar,
“almost every litigation matter potentially does”. Devel-oping competence is not only a smart play for developing critical evidence, it is also an ethical duty, and remembering the ABC’s of ESI is a first step to complying with ethical standards, preserving important evidence, and keeping costs under control.
(Endnotes)1 http://time.com/4114886/oxford-word-of-the-year-2015-emoji/2 Cal. State Bar Formal Opn. No. 2015-1933 California Rule of Court, Rule 3.274(8)4 Regents of University of California v. Superior Court (Aquila Merchant Services, Inc.) (2008) 165 Cal.App.4th 672, 683; Kilopass Tech. Inc. v. Sidense Corp. (N.D. Cal. 2012) 2012 WL 1534065. 5 Cedars-Sinai Med. Ctr. V. Sup.Ct. (Bowyer) (1998) 18 Cal.4th 1. 6 New Albertsons, Inc. v. Sup. Cot (Shanahan) (2008) 168 Cal.App.4th 1403. 7 CCP § 2031.060(i)(1). 8 See Toshiba America Electronic Components, Inc. v. Superior Court (2004) 124 Cal.App.4th 762.9 San Diego Unified Port Dist. V. Douglas E. Barnhart, Inc. (2002) 95 Cal.App.4th 1400.10 See Toshiba America Electronic Components, Inc., supra, 124 Cal.App.4th 762, fn. 4.
Matt Haulk is a partner at Ragghianti Freitas, LLP. Mr. Haulk is a litigator and trial lawyer, representing businesses, contractors, homeowners, and homeowners associations in commercial, construction, and real estate disputes. He has extensive experience with e-discovery and ESI, and may be contacted at [email protected].
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(ESI, continued from page 4)
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The Marin Lawyer
(Continued on page 7)
This month, Marin County Superior Court, Legal Aid of Marin, and St. Vincent de Paul’s Society of Marin will celebrate the fifth anniversary of the award-winning Marin Community Court. MCC is an alternative sentenc-ing program that has helped more than 1,000 homeless or financially strapped defendants in Marin clear up minor infractions and turn their lives around with a fresh start.
Traffic fines: Judge Beverly Wood identifies a problem
In a way, it started with Penal Code Section 14601 – Driving on Suspended or Revoked License. The first of-fense of this statute includes up to a $1,000 fine; the second can be a misdemeanor; the third can even lead to jail time. For far too many Marin County residents who are either homeless or precariously housed, the loss of a license means the loss of jobs, homes, and even their families.
The Honorable Beverly Wood took note of this prob-lem in 2011 when she served as a Traffic Commissioner in the Superior Court. Judge Wood’s courtroom was flooded with defendants trapped in a downward spiral. “I saw defendants so deep in fines and caught in a vicious cycle with no way to get out. I saw the negative effect these fines were having on families, seniors, and residents in Marin and wanted to do something about it.”
In 2011, Legal Aid of Marin’s Maura Prendiville and St. Vincent’s Cris Jones noted the same problem, and col-laborated with Judge Wood to create the Marin Community Court. Since 2011, Judge Wood has presided over every session of MCC held on the second Tuesday of each month at St. Vincent’s dining hall. “I remember at our first session, I brought a flag but we didn’t have a stand. So we took a milk crate and propped it up. I thought, ‘this is who we are; completely winging it,’” recalls Judge Wood. Those wings quickly took flight.
In 2015, 223 MCC participants cleared over 314 citations, representing 416 infractions and $200,000 in court fines through alternative sentences such as com-munity service, sobriety programs, parenting courses/life skills courses, employment support training, traffic or DUI courses, vehicle insurance and/or registration, follow through on physical/mental health care, or seeking veterans support services.
MCC receives grant support from institutions such as Peter E. Haas Jr. Family Fund, van Loben Sels/RembeRock Foundation, and Silicon Valley Bank. With the exception of a part-time coordinator, MCC has been completely operated by volunteers. In addition to Judge Wood, retired Bailiff Vince Simpson and Court Clerk Hoang LeClerc have vol-unteered their time since the first session. Each month, pro bono attorneys from all over the county rotate and volunteer to represent the defendants at MCC. Personnel from service agencies pair the defendants with individualized referrals and services, and community volunteers assist with in-take, check-in and set-up, transforming St. Vincent’s dining hall into an official Marin Superior Court.
A second chance: one veteran’s storyMCC volunteers are committed to helping people
like Steven Ashby-Anderson, who was 16 years old when he received four tickets for smoking in public. The fines totaled upwards of $2,500. He joined the Marines and thought he had worked off his tickets. After serving in Iraq for three years, he was discharged due to the worsen-ing of undiagnosed psychosis. He returned to civilian life in Marin hoping to work and start a different life. While looking for work, he ended up getting traffic citations for minor infractions such as no registration, no seat belt, etc. No work meant he could not pay his citations and his license was suspended. Unable to pay, meant he had no license,
Legal Aid of Marin Marks Fifth Anniversary of Marin Community CourtAward-winning program has helped hundreds make fresh start
From left: MCC Volunteer Clerk Hoang Leclerc, The Hon. Beverly Wood & Volunteer Bailiff Vince Simpson
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no way to get to work, and he ended up homeless. Because of penalties and the mistakes he made as a teen, his fines totaled nearly $15,000.
In July 2015, Mr. Ashby-Anderson came to MCC, where Legal Aid’s MCC Coordinator Susana Romo suc-cessfully guided him through applying for a discounted amnesty on his tickets as a teen. Ms. Romo connected Mr. Ashby-Anderson with Pro Bono attorney Matt Briggs who helped him present his case to Judge Wood. After receiving an alternative sentence of community service working with the Veterans Association, proof of working with a mental health provider, vehicle insurance and registration, Mr. Ashby-Anderson was disqualified for getting a new ticket for no plates on his car.
Four months later, Mr. Ashby-Anderson showed up un-announced to the Legal Aid office to speak with Ms. Romo. “I came to say thank you,” said Mr. Ashby-Anderson. “Be-cause of the MCC, I was able to get my military back pay and my mental health diagnosis and treatment. I am doing a lot better. I paid for a year of rent in Vallejo to get off the streets and am working with the Veteran’s Association to explore going to school and be retrained.” MCC gave him second chance, connecting him with the services he needed to move forward and off the streets.
This is one of the many success stories that MCC has had the privilege of being a part of over the past five years; it is the kind of impact that MCC will continue to work towards in the coming years.
MCC partners with Legal Aid of Marin, Marin Supe-rior Court, and St. Vincent de Paul Society of Marin County to honor the Fifth Anniversary of their collaboration for a week of events between April 11-15. To find out more about the project or to volunteer your time, e-mail MCC Coordi-nator Susana Romo at [email protected].
Delfin Vigil is the Director of Development & Com-munications at Legal Aid of Marin. He can be reached at [email protected].
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(Legal Aid, continued from page 6)
SUPERIOR COURT OF CALIFORNIA COUNTY OF MARINNOTICE: Revision of the Uniform Local Rules of Court (California Rule of Court 10.613)
The Judges of the Marin County Superior Court have approved a draft set of proposed Local Court Rules.As authorized under CRC 10.613, they are posted on the internet at the following web page of the Court:
http://www.marincourt.org/data/PDFs/ULRD.pdf
Should an individual or organization not have ac-cess to the internet, a printed copy of the local rules of court may be obtained at a cost of $40.00 in writing.
Written comments or proposed changes should be submitted no later than May 9, 2016 by 4:00 p.m. Should you need additional information regarding the revision of these local rules, please call the Of-fice of the Court Executive at (415) 444-7020, or email [email protected].
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The Marin Lawyer
DIRECTOR SPOTLIGHTNicole Cabalette
What is your practice area?I practice transactional business
and real estate law, as well as estate planning.
Do you have a particular emphasis? In my business practice, I serve as outside general
counsel to a variety of businesses and nonprofits, and rep-resent clients in connection with mergers and acquisitions, entity choice and formation, governance, dissolutions, securities regulation and secured financing. In my real es-tate practice, I represent commercial landlords and tenants with leasing matters, and property owners and investors in connection with the acquisition, development and financing of real property.
Why did you decide to become a lawyer? I am probably one of the few people who went to law
school knowing that I never wanted to go to court. I always knew I wanted to do something in business or real estate, but until shortly after graduating from college, I thought I would be on the MBA track and working in finance. After spending a couple of years working for a toy com-pany, I found I was asking too many questions about our company’s showroom lease, and what our contracts with inventors and distributors looked like, so I thought it might be a good idea to look into a law degree.
Where do you live? I live in San Francisco for now, but hope to move to
Marin in the next couple of years.
What do you love to do when you’re not busy practicing law?
I love trail running, hiking, snowboarding, and road biking. I also enjoy wine tasting and trying out new res-taurants.
Tell us about your family. My husband, Matt, is a software engineering manager,
and we’re expecting our first child at the end of April.
If you could pursue any other career besides law, what would it be and why?
I’m not sure. I really enjoy working with small to mid-size businesses and entrepreneurs, so probably something in consulting.
Why did you join MCBA? When I first began practicing in Marin almost 8 years
ago, I thought it would be the best way to get involved with the legal community. Since my practice rarely has me working with local lawyers or going to court, the MCBA offered the opportunity to get out of my office and meet other local lawyers.
Why did you become a Director?Larry Strick encouraged me to apply and after serv-
ing as Chair and Co-Chair of the Business Law Section for several years, I thought it would be a great way to stay involved with MCBA.
If you had to pick a single highlight of your career, what would it be?
One particularly interesting project involved draw-ing up a lease for a polar bear (a trophy, not a live bear, of course), which raised the issue of how to properly identify the property (hint: the size of the skull).
IN MEMORIUMVictor Peter Obninsky, 1944-2016
MCBA Past President Victor Obninsky passed away on Tuesday, March 15, 2016 after a long illness. He practiced law in Marin and Sonoma Counties from 1970 until his death. Vic moved to Sonoma, but always considered Black Point in Novato his home. Vic was President of the Marin County Bar Association in 1990, and was active on many MCBA committees. He was dedi-cated to improving the image of lawyers in the community.
Vic received a B.A. in History from Colum-bia in 1966 and a J.D. from the UC Hastings College of the Law in 1969. He was listed in a number of Who’s Who publications, in addition to being listed in the National Registry of Pre-eminent Lawyers.
He is survived by numerous loving friends and will be dearly missed. More about Vic’s life can be found in his online obituary.
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The Marin Lawyer
Integrative Mediation: When Are Two Heads Better Than One? By Kristine Stewart
When a legal dispute arises out of a failed relationship, the con-flict is rarely purely legal. In cases
involving an employer/employee dispute, or in cases of divorce or probate, the legal conflict is frequently driven by underlying emotion. If ignored, grief or anger, betrayal, fear, resentment, and hurt feelings can lead to impasse and prevent resolution of the legal issues. These types of cases are great candidates for co-mediation, also known as integrative mediation. In an integrative mediation process, attorneys and mental health professionals work together to mediate a dispute.
It is a rare attorney/mediator who feels entirely capable or comfortable working with the intensity of emotion that can arise where there is a high level of conflict. In such a mediation, it is not unusual for clients to burst into tears, rage, behave erratically, or persistently cling to what would appear to be totally irrational positions. Knowledge of the law does not present an obvious way to assist these clients to resolve their conflict, and there are occasions when every mediator experiences the struggle of keeping a difficult case on track.
Co-mediators bring complementary professional skill sets into the process, creating the means and opportunity for all aspects of a dispute to be examined and addressed at the same time. Together, these complementary psychological and legal skill sets can be a very effective means for resolv-ing high conflict disputes. Marin County Superior Court offers its own version of integrative mediation with its highly successful Interdisciplinary Settlement Conferences (ISC), voluntary settlement conferences where litigants can attempt to resolve custody disputes with the assistance of volunteer mental health professionals and attorneys.
In an integrative mediation, the attorney is primarily responsible for providing legal information, ensuring that all necessary legal issues are addressed. The mental health professional is primarily responsible for facilitating com-munication between the parties and providing emotional support, as well as educating the clients about relevant psychological information. Even though the professionals are grounded in their own areas of expertise, they are trained to work together in as seamless a manner as possible. Occasionally, other professionals who have been trained in the process may be brought in as well. For example, a financial analyst or child specialist might participate in a
divorce case. Because the underlying emotional aspects of the dispute are identified and addressed, parties tend to reach resolution more quickly, with fewer sessions needed overall. Additionally, parties may improve communication skills and gain a deeper understanding of the other, which can reduce further conflict down the road.
Integrative mediation operates on the premise that all legal disputes are human problems as well as legal ones, and recognizes that the best way to resolve such disputes is to disentangle their psychological and emotional, as well as their legal and financial facets. In the Bay Area, a number of professionals are offering integrative mediation services. For more information about this process and about available trainings, see the Integrative Mediation Bay Area website. http://imbayarea.com/about/
Kristine’s family law practice includes integrative mediation, mediation, collaborative law, and litigation. Her practice focuses on helping divorcing couples and individuals reduce the level of conflict, regardless of the process. She is a volunteer panelist for Marin County Inter-disciplinary Settlement Conferences, and will soon expand her practice to include work as a Parenting Coordinator. [email protected].
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Contracts Should Include Post-Judgment Interest ProvisionsBy Ravi Sahae
“For more than a decade now, it has been more profitable to leave a judgment uncollected and let the interest mount up for a while than [to] immediately collect it.”
In re Marriage of Cordero (2002) 95 Cal.App.4th 653, 658.In California, judgments accrue interest at 10% per
year.1 As the Hon. Justice David Sills recognized in his thoughtful opinion in Cordero, there is a large disparity between this rate and the rate that generally could be re-turned on conservative investments.
As such, judgment creditors can reap huge interest gains when a judgment debtor fails to tender satisfaction and the judgment creditor does not collect on the judgment. As Justice Sills noted, it is almost always more profitable to let a judgment lie uncollected than to collect the judg-ment and re-invest that money elsewhere, at least where the judgment debtor is solvent.
However, the 10% interest rate only applies to judg-ments awarded in California state courts. It does not apply to judgments awarded in federal court – even where the under-lying substance of the lawsuit is governed by California law.2
The effects of this distinction can be substantial. For federal judgments, the applicable interest rate is determined by reference to “the weekly average 1-year constant matu-rity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.”3
Accordingly, for a federal court judgment entered during the week of February 29 – March 4, 2016, the post-judgment interest rate would be 0.56%.4 In one year, a $100,000 judgment would therefore only accrue $560 in interest. In contrast, a California state court judgment would accrue $10,000 in that same space of time.
It is thus highly beneficial to be able to apply the Cali-fornia interest rate and not the federal rate, and it is possible to do so even in federal court. Parties are free to include in their contracts a provision specifying that the California rate will apply to any judgment.5 However, the language must be “clear, unambiguous, and unequivocal.”6 A simple choice-of-law provision is insufficient.7 So is a provision that specifies an interest rate but does not expressly apply it to judgments.8
And so, the author recommends including a post-judgment interest provision in all contracts as a matter of course, just like attorney fee provisions. The author prefers
to include it as a final sentence to the fee clause: “Post-judgment interest shall be at the maximum rate permissible under state or federal law, whichever is greater.”
Alternatively, the post-judgment provision could state a specific percentage. One possible formulation could be: “Any judgment shall accrue interest at the rate of ten percent (10%) per annum, or the maximum post-judgment interest rate allowable under California law, whichever is greater.”
Although no authority has been found stating whether parties may properly contract for a post-judgment inter-est rate higher than the current 10% rate set forth by the Legislature, it is likely that any such attempt would fail.9 So, don’t get greedy.
One final word of caution: Despite the substantial ben-efits that can be derived from allowing a judgment to lie un-collected accruing interest, judgment creditors must be careful about running up against the 10-year statute of limitations for enforcing judgments.10 Although a judgment creditor is not required to demonstrate diligence to obtain a renewal of the judgment,11 nevertheless an application for renewal is subject to the judgment debtor’s right to demonstrate laches.12 A delay in enforcement solely for the reason of allowing interest to accrue could potentially meet the elements of laches (unrea-sonable delay resulting in prejudice) and render the judgment unenforceable beyond the 10-year period.13
(Endnotes)1 Cal. Code Civ. Pro. § 685.010 (“Interest accrues at the rate of 10 percent per annum on the principal amount of a money judgment re-maining unsatisfied”).2 See, e.g., In re Cardelucci (9th Cir. 2002) 285 F.3d 1231, 1235; Northrop Corp. v. Triad Intern. Marketing, S.A. (9th Cir. 1988) 842 F.2d 1154, 1155-56.3 28 U.S.C. § 1961(a).4 http://www.federalreserve.gov/releases/h15/20160307/5 See, e.g., Cataphora Inc. v. Parker (N.D. Cal. 2012) 848 F.Supp.2d 1064, 1074.6 See, e.g., FCS Advisors, Inc. v. Fair Finance Co., Inc. (2nd Cir. 2010) 605 F.3d 144, 148.7 Id. 8 See Aboulhosn v. Merrill Lynch, Pierce, Fenner & Smith Inc. (E.D. Cal. 2013) 940 F.Supp.2d 1203, 1228-29. 9 In Penziner v. West American Finance Co. (1937) 10 Cal.2d 160, the Supreme Court held that the usury law, Cal. Civ. Code §§ 1916-1 through 1916-5, was not repealed by the adoption of (what is now) Cal. Const. Art. XV, § 1, but rather the constitutional amendment merely amended §§ 1916-1 and 1916-2 to change the maximum permissible rate of interest from 12% to 10%. (Id. at 174.) While § 1916-1 pur-ports to allow parties to contract for a rate of interest upon judgments of up to 12%, Penziner indicates that the statute likely must be read as limiting the permissible contract rate to 10%. (See also, e.g., Bisno v. Kahn (2014) 225 Cal.App.4th 1087, 1110 fn. 8 (noting in dictum that while federal law does allow parties to contract around the federal rate, California would likely not allow parties to do so in violation of the usury law).) 10 Cal. Code Civ. Pro. § 683.020.
(Continued on page 11)
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The Marin Lawyer
Insurance Policy Appraisal – Arbitrating A Property ClaimBy Brendan Fogarty
Consider Contractual Arbitration To Decide An Insurance Dispute
If your client has a property insurance dispute, an uncommon form of ADR could help to avoid a lawsuit. Under California Insurance Code Sections 2070-2071, fire insurance policies must contain an appraisal provision that may be invoked to settle disputes over the value of losses. An appraisal only applies where the disagreement involves the amount of the loss; an appraisal may not be used to determine the cause or extent of the damage, policy interpretation, or coverage issuesf (Figi v. New Hampshire Ins. Co. (1980) 108 Cal.App.3d 772.)
As a form of contractual arbitration, an insurance appraisal is governed by Code of Civil Procedure Sec-tions 1280, et seq. (Appalachian Ins. Co. v. Rivcom Corp. (1982) 130 Cal.App.3d 818.) When a party demands an appraisal, the process is mandatory, except in the event of a government-declared disaster. (Insurance Code §2071.) Each side selects a competent and disinterested appraiser; two appraisers then choose a neutral umpire. After consid-ering evidence, the panel deliberates and issues an award.
Appraisal aims to be a “beneficent substitute for the complicated and time-consuming processes of common law.” (Hyland v. Millers National Ins. Co. (9th Cir. 1937) 91 F.2d 735.) Accordingly, appraisal proceedings are “in-formal”, meaning there is no formal discovery or rules of evidence, and no court reporter, unless the parties agree otherwise. (Insurance Code §2071.) Even so, due to dis-putes about an appraisal panel’s power, the process is not always efficient. Petitions to the court can be necessary to determine whether an appraisal is appropriate, the scope of the process, and the award’s validity. However, a recent appellate opinion should clarify and streamline the process.
Recent Appellate Guidance For Policy AppraisalsIn Lee v. California Capital Ins. Co. (2015) 237 Cal.
App.4th 1154, the Court of Appeal addressed an appraisal panel’s authority to decide valuation disputes in property insurance losses, and offered guidance on reaching a valid award. The Lee opinion held that parties may appraise a loss which involves disputes about coverage, causation, or policy interpretation. But in those situations, the award form must show that the panel did not actually decide those issues, but instead determined only the amount (dollar
value) of the loss. This requires a careful approach by the parties and panel in preparing a clear award form. Under Lee, future policy appraisals should more effectively deter-mine valuations, while preserving disagreements outside a panel’s authority for later resolution. Before committing to litigation, consider appraising a property insurance dispute concerning the amount of the loss. In light of Lee, hopefully you and your client will experience a “beneficent substitute” for litigation.
Brendan J. Fogarty is a partner at LHB Pacific Law Partners, LLP in Emeryville. He represents insurers in both litigation and claims. Mr. Fogarty has tried numerous bad faith cases and arbitrated many insurance disputes. His firm handled the Lee appraisal and appeal for California Capital. He can be reached at [email protected].
11 OCM Principal Opportunities Fund v. CIBC World Markets Corp. (2008) 168 Cal.App.4th 185, 194.12 See, e.g., In re Marriage of Fellows (2006) 39 Cal.4th 179, 184-85 (noting that Legislature specifically limited the laches defense for family law judgments to be only available for judgments in favor of the state). 13 See, e.g., Cordero, supra, 95 Cal.App. at 663-64 (noting the con-siderable justification for laches where the judgment creditor sits back allowing 10% interest to accrue).
Ravi Sahae has been an associate of Flynn Riley Bailey & Pasek LLP since 2011, specializing in real estate and construction litigation. He represents commercial landlords and tenants, developers, contractors, brokers, homeown-ers, lenders, borrowers, and real estate professionals in resolving disputes efficiently and effectively. Contact him at [email protected].
(Post-Judgement, continued from page 10)
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Along with the SCBA Education Committee presents:
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Legal Issues in the Wine & Craft Beer Industry:From Startup to Succession
Leslie “Les” Perry Perry, Johnson, Anderson,
Miller & Moskowitz
Kim Marois Clement, Fitzpatrick &
Kenworthy
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Grattan & Mitchell
Donald Winkle Spaulding McCullough
& Tansil
Theresa Rodriguez Fritz Fritz Law Offices
Natalie Cilurzo Russian River Brewing
Company
Sandra Wickland Attorney at Law
Date: Friday, April 29, 2016 Time: Check-In: 8:00 am ; Program: 9:00 am - 4:00 pm
Place: Camelot Ballroom, Fountaingrove Inn, 101 Fountaingrove Parkway, Santa Rosa, CA 95403
Cost: $295--Marin County Bar Association and SCBA Members; $350--Public; $195--Student* * Students must provide proof of current enrollment with their registration to utilize student pricing.
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A continental breakfast served during check-in, lunch buffet with meat and vegetarian options, and wine reception will be provided. Any special dietary requests must be given to SCBA
via phone (542-1190 ext. 17) or email ([email protected]) by April 8, 2016.
Panel 1: Introduction &
Top 10 Things to Know
Panel 2: Startups
Panel 3: Employment
Panel 4: Succession
Panel 5: Land Use
Richard Idell The Idell Firm
Stephen Butler Clement, Fitzpatrick
& Kenworthy
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Mary Jo LafayeHECM Reverse Specialist NMLS #246222
[email protected] 5th Ave Suite 150ASan Rafael, CA 94901
10,000 Americans will turn 65 each day for the next 15 years. Marin County has seen a 16% increase in this age category over the last four years...
You are invited to attend a Lunch-n-Learn Downtown San Rafael, exclusively for attorneys, financial and legal advisors:As a professional and a trusted advisor, keeping up-to-date on program guidelines that affect your aging clients is imperative.
Retirees in our area have an overwhelmingly large portion of their wealth tied up in their home eq-uity. To learn HUD’s latest program changes to help our aging population age in place or downsize/right size when appropriate, we are offering three dates with educational presentations and lunch:
1. Friday, April 22nd from 11:30-1 p.m. (lunch served)2. Wednesday, May 4th from 11:30- 1p.m. (lunch served)3. Thursday, May 12th from 3-4:30 p.m. (tasty appetizers served)
RSVP to reserve your seat: 415.259.4979
Synergy One Lending, Inc. d/b/a Retirement Funding Solutions NMLS 1025894. Licensed by the Department of Business Oversight under the California Residential Mortgage Lending Act - California License 4131356. These materials are not from HUD or FHA and the document was not approved by HUD, FHA or any Government Agency.
• Pay off foreclosures/bankruptcy - Ch. 13
• Help divorcing retirees both become homeowners again: a HECM can provide cash out to one spouse for new home purchase, without either spouse liquidating assets or acquiring a monthly mortgage payment.
• Settle estates upon inheritance
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Opening for Attorney on Law Library Board of TrusteesApplication Deadline: April 15
The Marin County Law Library is seeking an attorney to join its Board of Trustees. Trustees oversee management of the Law Library, and make and enforce all rules, regulations, and by-laws necessary for the administration, govern-ment, and protection of the Law Library. Those interested must apply by April 15 to the Marin County Board of Supervisors. More Info & Application
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CALENDAR DETAILS
Tues, April 12: 12:00 – 1:30 PMLabor & Employment Section MeetingUsing Mediation Magic to be a Hero to Your ClientSpeakers: Steven Rosenberg & Patricia PrinceRagghianti Freitas, 1101 Fifth Avenue, Suite 100Cost: $10 Section Members / $20 Non-MembersBrown Bag Lunch, 1 CLE CreditRegistration & InfoContact: Patricia Prince, [email protected]
Thurs, April 14: 12:00 – 1:30 PMReal Estate Section MeetingSupreme Court Cases in 2015-2016 on Mortgage LawSpeakers: Professors Christine Tour-Sarkissian & Roger Bernhardt, Golden Gate University1 hour CLE, generalLocation: Piatti Restaurant, Mill ValleyCost: $35 Section Members / $25 Members 5 years or less in practice / $45 Non-Section MembersRegistration & InfoContact: Tracy Wilson [email protected]
Tues., April 19, 2016: 12:00 – 1:00 PMFamily Law Section MeetingThe Hague Convention on International Child AbductionSpeakers: Brent D. Seymour & Richard HelzbergMarin County Courts, Courtroom HCost: Free, Members / $10 Non-MembersBrown Bag Lunch, 1 CLE CreditDetails & RegistrationContact: Abby Lucha, [email protected] or John Brekhus, [email protected]
April 20: 12:00 – 1:30 PMADR Section MeetingThe Myth of Objectivity: Fostering Neutrality and Collaboration in Interpersonal MediationSpeaker: Drew HutchinsonCost: $20 members / $30 non members Location: Resolution Remedies, 1000 4th Street, San RafaelRegistration & InfoRSVP: [email protected]
Wed, April 20: 12:00 – 1:30 PMProbate & Estate Planning Section MeetingCreditor Claims and Post-death LitigationSpeakers: Stacie Nelson, Holland & KnightCiaran O’SullivanLocation: Town Center Community Room, 770 Tamalpais Drive, Suite 201Brown Bag Lunch1 hr. CLE, generalRegistration & InfoContact: Anne Reilly [email protected] or Dan Furhman [email protected]
Wed, April 27: 12:00 – 1:30 PMApril Members LunchForum: Candidates for Marin Superior Court JudgeModerated by Larry StrickEmbassy Suites, San Rafael$45 Members / $50 Non-membersRegistration & InfoContact: [email protected]
Tues, May 10: 12:00 – 1:30 PMLabor & Employment Section MeetingSubstance Abuse IssuesSpeaker: David Mann, The Other BarRagghianti Freitas, 1101 Fifth Avenue, Suite 100Cost: $10 Section Members / $20 Non-MembersBrown Bag Lunch, 1 CLE Credit, Substance AbuseRegistration & InfoContact: Sarah Wright, [email protected]
Wed, May 18: 12:00 – 1:30 PMProbate & Estate Planning Section MeetingLocation: Town Center Community Room, 770 Tamalpais Drive, Suite 201Brown Bag Lunch, 1 hr. CLE, generalRegistration & InfoContact: Anne Reilly [email protected] or Dan Furhman [email protected]
SAVE THE DATEWed, May 25: 11:45 AM – 1:30 PMMCBA Members LuncheonSpeaker & Venue TBA
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