On May 11, 2011, the California Supreme Court granted review in Hodge v. Aon Insurance Services, No. S191415.  The plaintiffs in Hodge are insurance adjusters employed by Cambridge Integrated Services, a third-party claims adjusting firm.  Plaintiffs claim that they were entitled to overtime compensation; Cambridge claims they were performing “administrative” work and were therefore exempt.  The trial court ruled against plaintiffs, and the Second Appellate District, Div. 8, affirmed in a published opinion, Hodge v. Aon Ins. Services (2011) 192 Cal.App.4^th 1361.  That opinion has been de-published as a result of the Supreme Court’s order. The Court has deferred briefing on the case until it resolves another pending matter that deals with overtime compensation for insurance adjusters, Harris v. Superior Court.

On April 26, 2011, Division 8 of the California Court of Appeal for the Second Appellate District certified for publication its opinion in Liberty National Enterprises, LP v. Chicago Title Ins. Co., no. B222455. In the underlying bad-faith action by Liberty against its title insurer, Chicago Title, Chicago moved to disqualify Liberty’s trial counsel after the second phase of a three-phase trial. Chicago Title argued that Liberty’s trial counsel had formerly represented other insureds to whom Chicago Title had issued coverage, and was improperly using his knowledge of Chicago Title’s claims practice to Chicago Title’s prejudice. The trial court denied the motion to disqualify, finding that it was not brought timely. The Court of Appeal affirmed, finding that it was not timely, and that Chicago Title was unable to show any basis for disqualification.

Read the Decision: Liberty National Enterprises, LP v. Chicago Title Ins. (.pdf)

Counsel for Ralphs’ does not acknowledge that their position was that truck drivers and their employers should be immune from civil liability for the driver’s decision to illegally park a 40-ton obstacle on the freeway shoulder so he could eat a banana and have a cup of tea.  Under Ralphs’ theory, truck drivers could park their trucks alongside California freeways anywhere they pleased, for any reason, and as long as they were not blocking a traffic lane there would be no recourse if a passing motorist momentarily swerved onto the shoulder and struck the illegally-parked truck.

In the Daily Journal article Ralphs’ lawyer is quoted as saying that, “after this decision there is no safe place to park in California.”  At oral argument the Justices asked this same attorney whether it would be ok for a truck driver to park 3 inches from the travel lanes, and she said that would be fine. If Ralphs’ position had been adopted there would have been no safe place to drive in California, and the Supreme Court recognized this.

It is important to understand that the Cabral decision does not impose a new duty of care on truck drivers, or on anyone else.  Rather, it holds that the duty to exercise ordinary care not to create unnecessary risks that is already imposed on everyone in California by Civil Code section 1714, applies to a decision to park a truck alongside a freeway.  Ralphs was arguing that the decision to park next to a freeway should be exempt from any duty of care.

When Ralphs’ lawyer says that now, it’s not “safe” to park in California because if your vehicle is stuck a jury will decide whether you had a good enough reason to park, the answer is, that’s generally how the negligence system works.  Negligence cases balance the utility of the conduct with the risks it creates.  If there had been a valid emergency no one questions that the Ralphs’ truck could have pulled off the freeway.  But as the Supreme Court acknowledged, whenever 40-ton big-rigs are parked alongside freeways they pose a risk to passing motorists.  If there is a collision between a motorist and a parked truck, it makes sense that the jury would consider whether the truck was parked where it was for a valid reason, and not simply because the driver did not feel like paying to park in a rest area a mile away.

Time Line for Cabral Appeal

• California Supreme Court grants petition for review filed by Ehrlich Law Firm
• Jeffrey Ehrlich argues negligence case in California Supreme Court
• Ehrlich Law Firm wins landmark negligence ruling in California Supreme Court
• Read the California Supreme Decision for Cabral v. Ralphs (.pdf)

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In a unanimous decision the California Supreme Court reversed a JNOV ordered by the Court of Appeal in Cabral v. Ralph’s Grocery Co. The decision reinstates a wrongful death judgment on behalf of the family of Adelmo Cabral, who was killed when his car veered off the freeway and collided with the back of a Ralph’s tractor-trailer rig that had been parked 16 feet from the freeway while its driver had a snack. The jury held that Ralphs’ was 10% at fault for the crash, but the appellate court reversed, finding that the crash was “unforseeable” and that truck drivers therefore owed no duty to passing freeway motorists in the manner in which they parked their trucks as long as they were out of the travel lanes. The Supreme Court rejected all of the appellate court’s reasoning. The decision is important because it expressly curtails the practice used by trial and appellate courts with increasing frequency to decide negligence cases as a matter of law by finding that the defendant owed the plaintiff no duty of care on the particular facts of the case. The Court held that the decision that no duty of care is owed — which is more accurately framed as a finding that an exception should be made to the general duty of care imposed on all persons by California law — “is to be made on a more general basis suitable to the formulation of a legal rule.” As a result, the Cabral decision will mean that more negligence cases in California will be decided by juries, based on the specific facts of the case, and not by courts based on a finding that no duty exists.

Read The Decision (.pdf)

Ehrlich Law firm obtains reversal of order dismissing bad-faith and broker-negligence lawsuit. In Koch v. Markel Ins., No. B213610, the Second Appellate District, Division 7, reversed an order sustaining a demurrer to the plaintiff’s claims against his insurance broker and his business insurer for negligence, breach of contract, and bad faith.

Read the Decision (.pdf)