Oakes v. Progressive Transp. Servs., Inc.

• Decision Date: 10 November 2021
• Docket Number: B305535
• Citation: 71 Cal.App.5th 486,286 Cal.Rptr.3d 476
• Parties: Mitchell Hunter OAKES, Plaintiff and Appellant, v. PROGRESSIVE TRANSPORTATION SERVICES, INC., et al., Defendants and Respondents.
• Court: California Court of Appeals Court of Appeals

71 Cal.App.5th 486

286 Cal.Rptr.3d 476

Mitchell Hunter OAKES, Plaintiff and Appellant,

v.PROGRESSIVE TRANSPORTATION SERVICES, INC., et al., Defendants and Respondents.

B305535

Court of Appeal, Second District, Division 2, California.

Filed November 10, 2021

Certified for Partial Publication.^*

Kyle Scott Law and Kyle J. Scott for Plaintiff and Appellant.

Prindle, Goetz, Barnes & Reinholtz, Nicholas Paulos, Long Beach, Steven Maslauski ; Greines, Martin, Stein & Richland, Laurie J. Hepler, San Francisco, and Eleanor S. Ruth for Defendants and Respondents.

CHAVEZ, J.

Plaintiff and appellant Mitchell Hunter Oakes (plaintiff) appeals from the judgment and postjudgment orders entered in favor of defendants and respondents Progressive Transportation Services, Inc. (Progressive), and Salvador Guzman (collectively, defendants) in this action arising out of injuries plaintiff sustained in an automobile accident. Plaintiff contends the trial court erred in denying his motion for a new trial based on purported juror misconduct. Plaintiff further contends the trial court erred in concluding defendants’ Code of Civil Procedure section 998¹ offer to settle was valid, subjecting plaintiff to the statutory penalty because he recovered less at trial than the amount of the offer. Finally, plaintiff contends the trial court erred by not according priority to reasonable litigation expenses and attorney fees owed to plaintiff's counsel under Labor Code section 3856.

We affirm the judgment.

FACTUAL BACKGROUND

On March 4, 2013, Guzman rear-ended plaintiff's vehicle. At the time of the accident Guzman was driving a truck for his employer, Progressive, and plaintiff was driving a truck for his employer, Asplundh. In the days following the accident plaintiff reported low back pain, stiffness in his neck, and a strained shoulder muscle. He was prescribed pain medication and a muscle relaxant. Plaintiff returned to work regular hours and duties for the next three weeks, but left his employment in early April 2013.

During the months following the March 2013 accident, plaintiff continued to receive treatment for pain, including prescription medications, doctor visits, diagnostic tests, and physical therapy. His former employer's workers’ compensation insurance carrier, Liberty Insurance Corporation (Liberty), paid for the treatment. In August 2013, plaintiff's pain worsened, and an MRI showed a significantly herniated disc

. In September 2014, plaintiff had spinal surgery, which was not approved or paid for by Liberty.

PROCEDURAL HISTORY

Pretrial proceedings, trial, and jury verdict

Plaintiff commenced this action against defendants Progressive and Guzman for negligence and negligence per se, seeking damages for past and future medical expenses, pain and suffering, and lost earnings and earning potential. Liberty filed a complaint in intervention, seeking to recover against any judgment a lien for workers’ compensation benefits paid to plaintiff, as authorized by Labor Code section 3852. Liberty subsequently assigned its workers’ compensation lien to defendants and was dismissed from the case.

In November 2015, defendants served an offer to settle under section 998 for $200,000. Plaintiff rejected the offer.

Before the jury trial commenced the parties stipulated that a workers’ compensation lien existed in the amount of $256,631.76; that defendants would admit negligence, but not causation as to plaintiff's injuries; and that notwithstanding the stipulation as to negligence, defendants could present evidence regarding comparative fault. At the parties’ request, the trial court read the stipulation to the jury twice, before the presentation of evidence and again before jury deliberation commenced. Also at the parties’ request, the trial court instructed the jury pursuant to CACI No. 105 not to consider insurance: "You must not consider whether any of the parties in this case has insurance. The presence or absence of insurance is totally irrelevant. You must decide this case based only on the law and evidence."

The jury returned a verdict of $115,000 in plaintiff's favor, and on January 22, 2020, the trial court entered an initial judgment for that amount in plaintiff's favor.

Posttrial proceedings and final judgment

Motion for new trial

Plaintiff filed a motion for a new trial, or in the alternative, for additur, arguing that two jurors committed prejudicial misconduct by bringing into deliberations their prior experience and knowledge regarding the workers’ compensation system. In support of the motion, plaintiff submitted affidavits from two jurors, Sophia Martinez and Gretchen Kiker, explaining the alleged misconduct and its effect on the jury's deliberations and verdict. The trial court granted defendants’ motion to strike portions of the affidavits that discussed the jury's "mental processes" and were therefore inadmissible under Evidence Code section 1150.²

The trial court ruled that what remained of Martinez's and Kiker's affidavits did not establish misconduct, but rather, correctly described the court's instruction not to consider insurance and included general observations about workers’ compensation, a matter of common knowledge that the jury could permissibly consider. The trial court took judicial notice of the fact that workers’ compensation was a matter of common knowledge in California, citing Evidence Code sections 451, subdivision (f) and 452, subdivision (g).³

The trial court noted that the affidavits "demonstrate[d] an unfortunate level of confusion" among the jurors, "conflat[ing] the Workers Compensation lien with insurance." Such confusion, the court stated, was compounded by the parties’ instructions and argument. The trial court noted that although the parties both asked the court to read to the jury the stipulation regarding the workers’ compensation lien, they never asked the court to further instruct the jury on the meaning of the word "lien" or the significance of the stipulation. The court further noted that plaintiff's counsel told the jury during closing argument "that the workers compensation lien amount would not go to the plaintiff" and that "may have compounded the confusion."

The trial court denied plaintiff's motion for a new trial, concluding: "This is not a matter of concealed bias or the use of specialized knowledge. The affidavit[s] reveal[ ] an effort to conform universal knowledge or common knowledge with the dictates of the court and the guidance of the attorneys."

Labor Code section 3856 motion for fees

Plaintiff then filed a motion for attorney fees and litigation expenses under Labor Code section 3856, subdivision (b), claiming a $50,600 fee (44 percent of the jury verdict pursuant to his contingency agreement with his attorney), and $28,343.52 in costs. Defendants opposed the motion for fees and moved to tax plaintiff's postoffer section 998 costs, arguing he should not recover fees and postoffer costs because the jury verdict did not exceed defendants’ section 998 offer. Defendants argued that plaintiff was entitled to recover only his pre-offer costs—the $475.95 filing fee—and filed a cost memorandum claiming that defendants, as the prevailing parties under section 998, should be awarded their postoffer costs under section 998, subdivisions (c)(1) and (e). Defendants’ costs, totaling $174,830.29, consisted primarily of expert witness fees incurred to dispute causation. Plaintiff moved to strike defendants’ cost memorandum and opposed defendants’ motion to tax his costs.

On April 30, 2020, the trial court, without a hearing, issued a minute order granting plaintiff's motion for $50,600 in attorney fees under Labor Code section 3856, subdivision (b) ; denying plaintiff's motion to strike defendants’ $174,830.29 cost memorandum; and granting defendants’ motion to tax plaintiff's postoffer costs under Code of Civil Procedure section 998.

The following day, defendants filed a request for clarification of the trial court's order in which they argued that the order failed to consider defendants’ status as prevailing parties under section 998, and that as such, they were entitled to judgment in their favor for their full costs—$174,830.29. Plaintiff objected, arguing he was entitled to $28,343.52 in costs in addition to $50,600 in attorney fees, his claim had priority under Labor Code section 3856, and no penalty under section 998 should apply.

On May 20, 2020, the trial court issued a second minute order ruling that plaintiff's entitlement to attorney fees under Labor Code section 3856 was not subject to the Code of Civil Procedure section 998 penalty provision, but that plaintiff's entitlement to litigation costs was subject to the penalty. The court awarded plaintiff $50,600 in attorney fees and only the $475.98 preoffer filing fee in costs.

Although the trial court noted that Labor Code section 3856 required costs to be paid from the judgment, the court added plaintiff's attorney fees and allowable costs to the jury's $115,000 verdict rather than subtracting them from that amount. The court calculated plaintiff's award as "$115,000 + $50,600 + $475.98 = $166,075.98." The trial court awarded defendants costs of "$174,830.20" under section 998, subdivision (c)(1). The court then concluded "[t]he defense has a net gain over the plaintiff of $8,754.22, and thereby becomes the prevailing party, i.e., ‘the party with a NET monetary recovery.’ "

Plaintiff then filed a "Request That the Court Clarify and Revise Its Rulings Based Upon Authority Not Previously Considered by the Court," citing Phelps v. Stostad (1997) 16 Cal.4th 23, 65 Cal.Rptr.2d 360, 939 P.2d 760 ( Phelps ). Defendants opposed the request as an improper request for reconsideration and argued that the trial court should not have awarded plaintiff any attorney fees under the Labor Code. The trial court declined to consider either party's briefs.

On June 23, 2020, the trial court vacated the January 2020 judgment and entered a new final judgment in favor...