California Appellate Lawyer & Attorney : Archer Norris Law Firm : Trial, Business, Torts : Sacramento, Bay Area, Los Angeles, California

Mike McKee at the Recorder wrote an interesting article yesterday about the reply brief on appeal.  Apparently, it is a controversial document, with some judges bemoaning another fifteen pages reiterating appellant's arguments and others claiming that it is the first document they read.

The article talks briefly about Justice Scalia's thoughts, offered in response to questions on his recent book tour.  At the seminar in D.C. last week with he and legal writing guru Bryan Garner, Justice Scalia spoke at some length about the danger of not anticipating judges who are "retro-readers" -- who read the briefs in the opposite order in which they are filed.  As the Recorder article confirms, many justices and judges work from back to front when reading briefs, believing that it is not until the reply brief that the "real" issues and controversies between the parties are sufficiently pared down to warrant consideration.

In my humble opinion, the question of whether or not to file a reply brief (as opposed to its content) is really a non-issue.  We are advocates for our client, and although there are certainly times when less is more, I do not believe that letting your opponent’s analysis of your argument sit as the last word is ever good advocacy.  As Justice Stein commented, the lack of a reply brief, “gives you a clue it's not a strong case."

For me – argument over.

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On a more serious note than clapping jurors (see previous post), the Supreme Court published its ruling in Crawford v. Weather Shield Mfg., Inc. yesterday, explaining that, in the context of indemnity agreements, a contractual duty to defend may be separate and distinct from the duty to indemnify.

Previously, in Regan Roofing Co. v. Superior Court (2004) 24 Cal.App.4th 425, the court held that a contractor’s duty to defend pursuant to an indemnity agreement only arose if the indemnity obligation was triggered. So, for example, if the indemnity agreement required that a subcontractor be found negligent in order for its indemnity obligation to be triggered – its defense duty was not triggered either until such showing.

Not so says the Supreme Court. Where an indemnity agreement provides a “duty to defend” rather than a mere promise to pay defense costs as part and parcel of its indemnity obligation, the duty is triggered upon the making of allegations that fall within the indemnity obligation. More importantly, the Court held that this duty to defend is implied in every indemnity agreement pursuant to Civil Code Section 2778. So if parties do not intend to be liable for providing a defense before their own indemnity obligation is triggered, the contract must specifically state as much.

Now, I am not an expert in construction defect litigation by any means. However, it seems to me that the indemnity cross-complaints that begin to fly as soon as a construction defect action is filed against a general contractor may be better suited to separate claims for declaratory relief on the duty to defend in light of this ruling. Moreover, who gets to control the defense? What if there are fifty subs who all owe a duty to defend the general and they can’t agree on a lawyer? Through years of trial and error (and a lot of litigation), liability insurers have had lots of practice nailing down the boundaries of their defense obligations. Contractors, at least in my limited experience, have paid less attention to the terms of the indemnity agreements in a standard construction contract. Looks like that may need to change, and quick.

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Yesterday in Bandana Trading Co., Inc. v. Quality Infusion Care, Inc., the Second District held that a juror's clapping during closing argument in response to counsel's reminder that the jury could disregard testimony by a witness it believed was not credible did not prejudice appellant's case.  

Apparently, Juror No. 2 thought someone was lying and exuberantly expressed her opinion in court.  The Second District didn't believe it was prejudicial since the case was nearly over and the other jurors, when polled, couldn't remember what had prompted the applause.

I am sure respondent's counsel just felt lovely after that little show of enthusiasm......

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Interesting new spat of lawsuits over the labeling of organic products.  According to an article in the National Law Journal yesterday, the California Attorney General filed five suits yesterday; including one against Whole Foods for including allegedly cancer-causing ingredients in purportedly  organic body products. 

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Yesterday, the Third District determined that the time for filing an appeal was triggered by the court's alternative decree regarding dissolution of the parties' limited liability company, rather than from the final judgment on plaintiff's dissolution complaint.

Sometimes the timing for filing a notice of appeal is trickier than one might think.

In Dickson v. Rehmke, one partner of a Limited Liability Company brought suit for dissolution of the company. Pursuant to California Corporations Code Section 17351 the court had three appraisers value the company and each partner's interest, then issued an alternative decree ordering plaintiff to either pay defendant for his share or the process of winding up the business and dissolution would commence. It's not entirely clear from the court's opinion how explicit the trial court's order was, yet, the court comments that the order should have been specifically worded as an alternative decree, but it wasn't. Regardless, the import of the order was that - if plaintiff paid defendant his share, the court would issue a judgment in favor of defendants on plaintiff's dissolution complaint -- Should plaintiff decided to forego payment and permit the process of dissolution and winding up to move forward, judgment on the complaint would issue at the conclusion of that process.

Plaintiff paid defendant for his interest and judgment was entered in favor of defendant. Plaintiff appealed from the judgment.

The court, however, ruled that the appeal was untimely -- That the order plaintiff should have appealed from was the order of decree itself pursuant to the language of Section 17351. According to the court, the issue of the valuation of the business (which was the subject of plaintiff's appeal) was decided by the alternative decree, not the judgment. The judgment was merely a way to "terminate the proceedings" following the court's valuation:

That a judgment will follow the alternative decree upon a tender does not mean the party making or accepting the tender who is dissatisfied with the valuation may await its entry to appeal that issue. This later entered judgment is on the underlying dissolution complaint for the purpose of terminating that proceeding through denying the requested relief. This judgment is not a vehicle for raising the issues of valuation on appeal, because the dissolution proceeding itself never embraced them.

The timing of an appeal from valuation of a company pursuant to Section 17351 may not arise very often in your day-to-day practice. Yet, time and again, appeals are dismissed because attorneys automatically assume they can always appeal from the judgment, rather than from an interlocutory order. As the Dickson case illustrates, this is not always the case. Check and double check those rules. And, if your instincts tell you that an order issued by the court is irrevocable and finally decides a case against your client, check again. Your instincts are probably right that the time for an appeal is from the order, not from the judgment.

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