Making the law better.
To do my part to make the law better, I occasionally take a case on what I call a “quasi pro bono basis,” meaning that I still charge the client, but at a greatly reduced rate. I only do this when the case presents an interesting issue, and it appears that the system is running over the client. This was such a case.
Our client was an auto body shop, and the owner, who were being sued under a bad claim and facts. The amounts involved were not huge, but an award in favor of plaintiff could have put our client out of business.
In California there is a statutory scheme to protect consumers, called the Automotive Repair Act, set forth at Business & Professions Code section 9880, et seq. It provides that an auto repair shop cannot perform any services on a customer’s car unless (1) the auto repair shop provides a written estimate, and (2) the customer authorizes the work.
Most of us are familiar with the process, whereby when we drop off our car to be worked on, the shop requires us to sign the written estimate. But we are all equally familiar with the fact that when we drop off our car, the repair shop may not know what the exact problem is, and therefore cannot provide an estimate. The shop calls later and explains the issue and the price, and the car owner verbally authorizes the work. Similarly, you might drop off your car for an oil change, but the shop then calls and suggests a radiator flush. Because of these realities, the Automotive Repair Act does not require a written authorization, only an authorization, which can be verbal.
The facts of this case had a twist. The plaintiff was involved in an auto accident, and he showed up with a repair estimate in hand, from his insurer. Our client reviewed the estimate, and agreed to do it at that price. But after working on the car for three days, the customer returned and claimed he had never authorized the work. He demanded the return of his car, refusing to pay for the work performed to that point. It was true that he had never signed the written estimate, but he had verbally authorized the repairs at least three different times. In fact, not only had he authorized the repairs, he had called his insurance company on a three-way call with the auto shop, to make sure there would be no problem with payment.
Our client initially stood firm that plaintiff would have to pay for the repairs performed in order to pick up the car. If it had just been labor, our client might have been more flexible initially, but in the auto industry, when a shop orders parts, there is a 25% re-stocking fee charged to the auto shop if those parts are returned. So in addition to the labor, our client was going to be out-of-pocket on the re-stocking fees.
Here’s where things got weird.
In the interest of customer relations, our client quickly relented, and told the plaintiff he could pick up his car at no charge. This would have been a tremendous windfall for the client, because a large percentage of the work was done. The next shop could complete the repairs for less than what the insurance company was paying, leaving the customer with money in hand. But incredibly, four months later, the plaintiff had still not picked up his car. Our client sent a final letter to plaintiff, telling him that if he did not pick up his car, it would be sold at auction and the money used to cover storage fees. Plaintiff still never picked up his car, so it was sold at auction for $4,000.
It was as though plaintiff had been waiting for the car to be sold, because he then immediately sued our client, demanding $250,000 in damages, consisting of the value of the car, punitive damages, and attorney fees. Plaintiff’s attorneys named the auto shop and its owner as defendants, suing both under a boatload of theories, including (1) violation of the Automotive Repair Act, (2) violation of the Consumer Legal Remedies Act, (3) breach of contract, (4) fraud, (5) negligence, and even (6) a Penal Code section for receiving stolen property.
At trial, we successfully moved for non-suit in favor of our individual client on all causes of action, and on most of the causes of action as to the auto shop. After all the evidence was presented, the court then found in favor of our client on all the remaining causes of action. A complete victory for our clients.
But wait, there’s more.
Since we had prevailed on the action, as is typically the case we were the ones ordered to submit the proposed judgment, reflecting judgment in favor of our clients. By statute, opposing counsel then has ten days to object to that judgment. This is limited to situations where the judgment does not reflect the court’s intention, but in this instance opposing counsel “objected” on the basis that he had found an old case that supported his prior arguments.
One of the causes of action was for violation of the Automotive Repair Act. But the problem is, there is no cause of action under the Automotive Repair Act. Just because a statute exists, it does not mean that it creates a private right of action. For example, there are laws that prohibit driving faster than the posted speed limit, but if someone hits your car while driving too fast, you can’t sue them under the statute for speeding. It doesn’t mean that you have no recourse — you can sue for negligence or whatever — but you can’t sue for speeding because there is no private right of action under that statute. Thus, we had disposed of this one, final cause of action by convincing the judge that no such cause of action existed.
But back to the proposed judgment. Opposing counsel objected, citing to an old case out of the 80s, where someone had sued for violation of the Automotive Repair Act, and had won.
One crazy judge.
The judge then did something that may go down in history as the craziest behavior by a jurist ever. But let me first set the scene.
There are certain maxims that apply to judicial review and precedent. Two apply here. The first is that an opinion must be interpreted based only on the words within that opinion. And closely related to that principle, an appellate opinion only acts as precedent for the issues that were presented and decided. And a third general principle of jurisprudence prohibits a judge or juror from conducting their own investigation of the facts of a case, unless the parties are all present and are afforded the opportunity to object.
Picture, for example, a case involving an automobile accident, and the issue is whether there was a stop sign at the intersection. So the judge takes it upon himself to drive by the intersection to see if there is a stop sign, and enters judgment on what he finds. But it might be that the sign was erected or taken down since the accident. The judge might not even be at the right intersection. For the trial to be fair, the parties must be able to challenge the evidence and conclusions from the judge’s private investigation.
So back to our case, the opinion cited by opposing counsel did indeed involve a situation where someone had sued for violation of the Automotive Repair Act, but there was not one word in the opinion about whether such a private cause of action exists. Unlike me, the defense counsel in that case simply had not spotted the issue, so he went through trial and appeal, never raising the issue. On that basis, the case simply could not be cited as authority for the position that a private right of action exists.
But the judge in our case wasn’t going to be constrained by hundreds of years of judicial reasoning. True, the opinion did not contain one word as to whether a private cause of action existed, but he wanted to know if the issue had ever come up. So the judge picked up a phone, and CALLED the attorney who had represented the defendant. Not surprising, given the passage of time, that attorney was dead or otherwise unavailable, so he called the plaintiff’s attorney. That attorney was sure that the issue must have been discussed at some point.
That was all the judge needed to hear. Without affording me any opportunity to cross-examine this new “witness” or in any way challenge his conclusions, the judge reversed himself and found that a private cause of action did indeed exist, and awarded plaintiff a small amount of damages.
The judge had introduced a new litigation technique, that would rock the legal world. Now, it was no longer necessary to accept the opinion from an appellate court. Instead, you could find new witnesses and question the attorneys involved, and make your own holding out of the opinion. I had to say, it was quite exciting. All those opinions I didn’t like, now I could navigate around them all.
But is wasn’t to be. I got the judgment thrown out. I appealed the matter, and the Court of Appeal agreed that there was no private cause of action for violation of the Automotive Appeal Act. My clients won and owed the plaintiff nothing.
I was momentarily disappointed, because the Court of Appeal did not “publish” the opinion, meaning that it would not be precedent for future cases. But a groundswell of support from the legal community arose, and the Court of Appeal decided to publish the opinion. Based on our efforts, there now actually is a holding on this point of law, without the need to call prior counsel to see what the opinion means.
To make sure the point is clear, this does not mean that auto shops can get away with making repairs without authorization. There are other claims to address that situation. To use our original analogy, we want people to be able to sue if they are injured in a traffic accident, but the claim would be for negligence, not for violation of the law against speeding. It’s bad enough having to deal with a cop giving you a ticket for speeding. Imagine if people could sue you if they saw you speeding.
I frequently have to explain to clients that their lives drive the litigation strategy, not the other way around. For example, I once had a potential client call me, wanting to sue for a defamatory comment the defendant had posted on the client’s own website. The client asked if he should remove the comment, or leave it up for the benefit of the envisioned litigation, even though it was very damaging to the client’s business. Of course the client should take down the post. You don’t leave up a damaging post for the sake of litigation.
I think that was what happened here. At some point, the plaintiff decided to sue, and must have thought that taking his car back would hurt his case. In actuality, he was right. If he had taken the car back, that would have immediately cut off any loss of use or loss of value damages. But the law imposes a duty to mitigate any damages. He could not simply refuse to pick up his vehicle, and then sue for the full value of that vehicle. He even claimed at trial that he had lost his job because he did not have his car, and kept showing up late. You would think, when the day came that he said to himself, “Wow, I’m going to lose my job if I keep showing up late,” it would have occurred to him that he should probably pick up his car. He tragically allowed the litigation to dictate his life choices.
It came out in trial that plaintiff had purchased the car for $24,000 (one month before the accident), and was paying a whopping 22% interest on the loan. By deciding he would not pick up his vehicle, apparently in the mistaken belief that would better serve his lawsuit, plaintiff is now left to continue making car payments on a car he doesn’t even own, in addition to reimbursing our clients for all the costs of defending this action.