Grissom v. Vons Companies, Inc., No. G010319

CourtCalifornia Court of Appeals
Writing for the CourtJACKMAN; SILLS, P.J., and MOORE
Citation1 Cal.Rptr.2d 808,1 Cal.App.4th 52
PartiesWilliam J. GRISSOM, Plaintiff and Appellant, v. VONS COMPANIES, INC. Defendant and Respondent.
Decision Date21 November 1991
Docket NumberNo. G010319

Page 808

1 Cal.Rptr.2d 808
1 Cal.App.4th 52
William J. GRISSOM, Plaintiff and Appellant,
v.
VONS COMPANIES, INC. Defendant and Respondent.
No. G010319.
Court of Appeal, Fourth District, Division 3, California.
Nov. 21, 1991.
Certified for Partial Publication *

Page 809

[1 Cal.App.4th 55] Mary L. Seebach, Orange, for plaintiff and appellant.

Gregory C. Pyfrom & Associates and Paula C. Gentile, Los Angeles, for defendant and respondent.

Page 810

OPINION

JACKMAN, Associate Justice, Assigned. *

I

In this case we explore an employer's duties under Labor Code section 2802, 1 which requires an employer to "indemnify" his or her employee "for all that the employee necessarily expends or loses in direct consequence of the discharge" of the employee's duties. 2 As explained below, the employer's duties include reimbursement of funds the employee "necessarily expends" to obtain independent counsel to defend an action for conduct within the course and scope of his or her employment. Because the plaintiff in this case may have necessarily expended funds for such counsel, we reverse the judgment of dismissal after a demurrer was sustained without leave to amend, and remand the case to give plaintiff the opportunity to amend.

1 Cal.App.4th 56

II

The plaintiff, a truck driver, was involved in an accident on November 29, 1987. Plaintiff claimed he was injured and sued the individuals he contended were responsible. He also presented a workers' compensation claim against his employer, a grocery chain.

The individuals sued by plaintiff struck back with a cross-complaint. They claimed he was responsible for their injuries. He demanded the grocery chain defend him from their claims.

The grocery chain hired a law firm to defend plaintiff against the cross-complaint. It was, however, the same law firm it hired to defend itself against plaintiff's workers' compensation claim. The law firm forced a reopening of discovery, which allowed the cross-complainants to obtain a medical examination of plaintiff--which he asserts was not at all helpful for either his own personal injury case or his workers' compensation claim.

When plaintiff discovered his law firm represented his employer in the workers' compensation claim, he fired it and demanded "independent counsel." The grocery chain refused and plaintiff instituted this lawsuit. The complaint seeks damages against the law firm for malpractice and a declaration the grocery chain is required to provide him with independent counsel.

The grocery chain demurred to the cause of action for a declaration, which was sustained without leave to amend. Plaintiff has now appealed from the subsequent order of dismissal of that cause of action. The lawsuit against plaintiff's former attorneys for malpractice continues.

III **

IV

This case arises under Labor Code section 2802. As Justice Barry-Deal pointed out in her dissent in Machinists Automotive Trades Dist. Lodge v. Utility Trailer Sales Co. (1983) 141 Cal.App.3d 80, 87, 190 Cal.Rptr. 98, cases under this statute are few. The most important is Douglas v. Los Angeles Herald-Examiner (1975) 50 Cal.App.3d 449, 123 Cal.Rptr. 683. This is the only case we have found, or to which we have been referred, that addresses the issue of defense costs for a lawsuit brought against an employee.

[1 Cal.App.4th 57] In Douglas a reporter was sued over a series of articles he had written allegedly using information in documents which were "illegally" leaked to him. The reporter requested that his employer, a newspaper, defend him against the suit, but the newspaper refused. The reporter then retained his own counsel and sued the newspaper,

Page 811

under Labor Code section 2802, to recover his attorney's fees and costs. The trial court rendered a judgment in the newspaper's favor, but the appellate court reversed.

In reversing, the court flatly opined, "We have no doubt that Labor Code section 2802 requires an employer to defend or indemnify an employee who is sued by third persons for conduct in the course and scope of his employment." (50 Cal.App.3d at p. 461, 123 Cal.Rptr. 683.) The court then concluded that if the suit against the reporter was because of acts done at the behest of his employer, the reporter "would be entitled to indemnity from [the newspaper] for the costs and expenses incurred in defending" the lawsuit against him. Because the trial court had not made findings on whether the reporter's acts were within the course and scope of his employment, the judgment had to be reversed and the case remanded. (See 50 Cal.App.3d at pp. 462-463, 123 Cal.Rptr. 683.)

Douglas thus held the reporter might be entitled, depending on whether his acts were within the course and scope of his employment, to reimbursement for the fees and costs of the attorney he selected. But that is all it held. The case did not address the situation presented by this case, in which the employer selects and initially pays for counsel.

The grocery chain has assumed that an employer may totally discharge any obligation under section 2802 by unilaterally selecting and paying for counsel to defend the employee when the employee is sued for conduct in the course and scope of employment. The statement in Douglas that an employer must "defend or indemnify" an employee for such conduct is probably the source of this assumption. If section 2802 requires employers "to defend" an employee, it is logical to conclude that employers meet this requirement by selecting and then hiring counsel to defend the employee, much like a liability insurance company must do for a policyholder.

The statement in...

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45 practice notes
  • James v. Group, Case No.: 14-CV-1756-AJB-JMA.
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Southern District of California)
    • December 2, 2015
    ...of an employee's transportation choices. Gattuso , 42 Cal.4th at 568, 67 Cal.Rptr.3d 468, 169 P.3d 889 (citing Grissom v. Vons Cos. , 1 Cal.App.4th 52, 58, 1 Cal.Rptr.2d 808 (1991) ). Relying on the California Supreme Court's decision in Morillion v. Royal Packing Co. , 22 Cal.4th 575, 578,......
  • Davis v. Farmers Ins. Exch., B257970
    • United States
    • California Court of Appeals
    • March 28, 2016
    ...were "necessarily expend[ed] in direct consequence of the discharge of the employee's duties." (Grissom v. Vons Companies, Inc. (1991) 1 Cal.App.4th 52, 57, 1 Cal.Rptr.2d 808, italics omitted.) However, that burden does not apply to the wage claim presented here, where appellant established......
  • Cassady v. Morgan, Lewis & Bockius Llp, No. B177747.
    • United States
    • California Court of Appeals
    • November 29, 2006
    ...425; Douglas v. Los Angeles Herald-Examiner (1975) 50 Cal.App.3d 449, 461, 123 Cal.Rptr. 683; Grissom v. Vans Companies, Inc. (1991) 1 Cal.App.4th 52, 57, 1 Cal.Rptr.2d 808; Plancarte v. Guardsmark (2004) 118 Cal. App.4th 640, 647, 13 Cal.Rptr.3d 315; Los Angeles Police Protective League v.......
  • Janken v. GM Hughes Electronics, No. B092333
    • United States
    • California Court of Appeals
    • June 5, 1996
    ...rights in the discrimination context, and the prospect of indemnity is by no means certain. (See Grissom v. Vons Companies, Inc. (1991) 1 Cal.App.4th 52, 1 Cal.Rptr.2d 808 [necessity of expenditures a question of fact; no statutory duty to defend].) In the event the employer is in poor fina......
  • Request a trial to view additional results
45 cases
  • James v. Group, Case No.: 14-CV-1756-AJB-JMA.
    • United States
    • United States District Courts. 9th Circuit. United States District Court (Southern District of California)
    • December 2, 2015
    ...of an employee's transportation choices. Gattuso , 42 Cal.4th at 568, 67 Cal.Rptr.3d 468, 169 P.3d 889 (citing Grissom v. Vons Cos. , 1 Cal.App.4th 52, 58, 1 Cal.Rptr.2d 808 (1991) ). Relying on the California Supreme Court's decision in Morillion v. Royal Packing Co. , 22 Cal.4th 575, 578,......
  • Davis v. Farmers Ins. Exch., B257970
    • United States
    • California Court of Appeals
    • March 28, 2016
    ...were "necessarily expend[ed] in direct consequence of the discharge of the employee's duties." (Grissom v. Vons Companies, Inc. (1991) 1 Cal.App.4th 52, 57, 1 Cal.Rptr.2d 808, italics omitted.) However, that burden does not apply to the wage claim presented here, where appellant established......
  • Cassady v. Morgan, Lewis & Bockius Llp, No. B177747.
    • United States
    • California Court of Appeals
    • November 29, 2006
    ...425; Douglas v. Los Angeles Herald-Examiner (1975) 50 Cal.App.3d 449, 461, 123 Cal.Rptr. 683; Grissom v. Vans Companies, Inc. (1991) 1 Cal.App.4th 52, 57, 1 Cal.Rptr.2d 808; Plancarte v. Guardsmark (2004) 118 Cal. App.4th 640, 647, 13 Cal.Rptr.3d 315; Los Angeles Police Protective League v.......
  • Janken v. GM Hughes Electronics, No. B092333
    • United States
    • California Court of Appeals
    • June 5, 1996
    ...rights in the discrimination context, and the prospect of indemnity is by no means certain. (See Grissom v. Vons Companies, Inc. (1991) 1 Cal.App.4th 52, 1 Cal.Rptr.2d 808 [necessity of expenditures a question of fact; no statutory duty to defend].) In the event the employer is in poor fina......
  • Request a trial to view additional results

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