Garcia Legal v. Molina

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GARCIA LEGAL, Cross-complainant and Respondent, v. MONICA MOLINA, Cross-defendant and Appellant.

B312235

California Court of Appeals, Second District, Seventh Division

March 13, 2023

NOT TO BE PUBLISHED

APPEAL from an order of the Superior Court of Los Angeles County No. 19STCV05642 Yolanda Orozco, Judge. Affirmed.

Monica R. Molina, in. pro. per., for Cross-defendant and Appellant.

Law Office of Dale E. Washington, Dale E. Washington; Garcia Legal and Steven Ray Garcia for Cross-complainant and Respondent.

PERLUSS, P. J.

Monica R. Molina (Monica) and Garcia Legal, a Professional Corporation, represented Esperanza Molina (Esperanza) Monica's mother, in a quiet title action that was eventually settled. Garcia Legal sued Esperanza to recover unpaid legal fees (just under $32,000). Esperanza filed a crosscomplaint against Garcia Legal, alleging it had breached the parties' retainer agreement and the fees already paid (approximately $62,000) exceeded the value of the services provided. Garcia Legal then cross-complained against Monica for indemnity, contending, if any legal services performed by Garcia Legal did not benefit Esperanza (which it denied), the work was necessary to rectify the errors committed during the litigation by Monica while representing their joint client.

Monica filed a special motion to strike Garcia Legal's crosscomplaint pursuant to Code of Civil Procedure section 425.16 (section 425.16). The trial court denied the motion ruling Garcia Legal's indemnity claim did not arise from protected petitioning activity. We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

1. The Original Real Property Lawsuit, Garcia Legal's Action To Recover Fees and the Two Cross-complaints

Esperanza, represented by Monica, filed a quiet title action against 304 Crane, LLC in April 2017, alleging a right to an easement burdening 304 Crane's property, which adjoined Esperanza's, in the Mount Washington neighborhood of Los Angeles. Esperanza retained Garcia Legal and its principal Steven Ray Garcia (who described himself on the firm's website as "the dirt lawyer") in September 2017 to represent her, as cocounsel with Monica, in the litigation. Esperanza discharged Garcia Legal in mid-December 2018 while the parties were discussing settlement. The lawsuit settled shortly thereafter.

Garcia Legal sued Esperanza on February 19, 2019 to recover unpaid legal fees of $31,864.61, alleging causes of action for breach of contract, open book account and declaratory relief. Esperanza on May 26, 2020 filed a cross-complaint for breach of contract and money had and received, alleging Garcia Legal breached its written agreement with Esperanza in connection with the 304 Crane litigation by misrepresenting Steven Garcia's experience and expertise; charging unconscionable fees; and billing for excessive hours spent on tasks that should have taken less time, work that was unnecessary and did not benefit Esperanza, and work performed for other clients. Esperanza further alleged that Garcia frequently absented himself without notice to Esperanza or Monica; abandoned Esperanza for a vacation two weeks before the scheduled trial date; and conveyed settlement offers without prior authorization. The crosscomplaint alleged Esperanza had paid $68,286 in fees and costs for Garcia Legal's representation in the 304 Crane litigation, an amount that exceeded by more than $10,000 both the actual value of the services provided and "the amount which Garcia Legal, following the terms of the aforesaid written agreement and the California State Bar Rules of Professional Conduct, should have billed [Esperanza]."

Garcia Legal on August 24, 2020 filed a cross-complaint against Monica for indemnity. As quoted in the trial court's ruling on Monica's special motion to strike,^[1] Garcia Legal alleged, "[T]o the extent Esperanza contends that [Garcia Legal] was billing excessively or performing services that were unnecessary or produced no discernable value to her, it was because [Garcia Legal] was required to respond to conduct and other actions of Monica and Does 11 through 20 that either fell below the standard of care, were reckless, or were the sole or primary cause of additional fees and costs incurred by Esperanza, as set forth above. In undertaking work responsive to and curative of Monica and Does 11 through 20's conduct, or consequences caused or contributed by her conduct [Garcia Legal] had no legal obligation [to] undertake the work without being paid to do so.... Therefore, to the extent that the court should find that [Garcia Legal] bears any responsibility for any of the claims asserted in Esperanza's cross-complaint, Monica and Does 11 through 20, and each of them, are required to indemnify and hold [Garcia Legal] harmless from these claims...."

2. Monica's Special Motion To Strike

On November 30, 2020 Monica moved to strike Garcia Legal's cross-complaint pursuant to section 425.16. Monica argued Garcia Legal's cause of action for indemnity arose from (indeed, was based entirely on) Monica's protected petitioning activity-written and oral statements made in, or in connection with, a judicial proceeding (step one of the section 425.16 analysis). She further asserted the indemnity claim lacked merit because all her purported misconduct was absolutely protected by the litigation privilege in Civil Code section 47, subdivision (b)(2), and, in any event, because Esperanza's claim against Garcia Legal was based in contract, not tort, there was no basis for a claim of equitable indemnity (step two of the section 425.16 analysis). Finally, again insisting that Esperanza's crosscomplaint was a contract action, not one for legal malpractice against Garcia Legal, Monica contended cases holding legal malpractice actions were not subject to a section 425.16 special motion to strike were not applicable to her motion.

In opposition Garcia Legal insisted Esperanza's crosscomplaint, which sought to recover fees previously paid in the 304 Crane litigation, although phrased as one for breach of contract, alleged Garcia Legal had breached its professional obligations as measured by the standard of care owed by attorneys and was, for all practical purposes, a claim for professional negligence. As such, Garcia Legal argued, its crosscomplaint for indemnity was not subject to a special motion to strike under the court of appeal's analysis in Chodos v. Cole (2012) 210 Cal.App.4th 692. Garcia Legal also asserted there was a probability it would prevail on the merits of its indemnity claim, including a lengthy declaration by Garcia to support this argument.^[2] The trial court denied the motion, finding Monica had failed to carry her burden on the first step of a special motion to strike. After quoting from Chodos v. Cole, supra, 210 Cal.App.4th at pages 702 through 704, the court explained, "[T]he anti-SLAPP statute does not apply to claims of attorney malpractice and a claim by an attorney against other attorneys for equitable indemnity in connection with a claim of attorney malpractice is not distinguishable from a client's claim against an attorney for malpractice. Here, while Esperanza does not assert a cause of action for legal malpractice against Garcia Legal, her theory of liability against Garcia Legal is based on Garcia Legal's negligence ...."

Monica filed a timely notice of appeal.

DISCUSSION

1. The Special Motion To Strike: Governing Law and Standard of Review

Section 425.16, commonly known as the anti-SLAPP statute, makes available a special motion to strike certain meritless claims early in the litigation: "A cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States Constitution or the California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." (§ 425.16, subd. (b)(1); see Rand Resources, LLC. v. City of Carson (2019) 6 Cal.5th 610, 619-620 ["[a] court may strike a cause of action only if the cause of action (1) arises from an act in furtherance of the right of petition or free speech 'in connection with a public issue,' and (2) the plaintiff has not established 'a probability' of prevailing on the claim"].)

Pursuant to section 425.16, subdivision (e), an "'act in furtherance of a person's right of petition or free speech under the United States or California Constitution in connection with a public issue' includes: (1) any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law, (2) any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other official proceeding authorized by law, (3) any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest, or (4) any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest."

In ruling on a special motion to strike under section 425.16 the trial court engages in a now-familiar two-step process. "First, the defendant must establish that the challenged claim arises from activity protected by section 425.16. [Citation.] If the defendant makes the required showing, the burden shifts to the plaintiff to demonstrate the merit of the claim by establishing a probability of success." (Baral v. Schnitt (2016) 1 Cal.5th...