California Civil Litigation Attorneys

The Litigation Process

Lawsuits can also be costly to file and negotiation prior to filing can save costs. Demand letters are often an effective way to formally request another side pay money that is owed. The tone and level of detail within a demand letter will vary depending on the relationship between the parties and the amount and complexity of the dispute. Other types of cases do not allow the filing immediately after a dispute and instead require parties to engage in some type of pre-litigation activity. For example, before a person or business can make a claim against any state-operated agency in California, a claim form must be submitted and a period of time must pass prior to eligibility to file a lawsuit.

Complaint and Answer – The initial document which begins a lawsuit is a complaint and it is served along with a summons to appear in California Superior Courts. The complaint will contain allegations by the plaintiff describing what the defendant did to cause the plaintiff some type of harm. The complaint will also request some type of relief, (in the form of money or the performance of some act). The answer is the defendant’s response to the complaint and must be filed within 30 days of personal service, (40 days in cases of substituted service). The answer contains the defendant’s responses to the allegations. It usually contains specific and general denials of the allegations and lists any affirmative defenses that would apply.

The defendant can also file a cross-complaint, (a claim against the plaintiff), or a cross-claim, (a claim against another defendant). The defendant’s other option is to file a demurrer, which is a response alleging the complaint’s claims, even if true, would not provide a legal basis for the lawsuit to continue. The demurrer asks for case dismissal. A demurrer may also request a dismissal because of a procedural defect within the complaint. A complaint may be dismissed with or without prejudice, (if a case is dismissed with prejudice, the complaint cannot be re-filed).

Discovery – In most litigated cases in California, the discovery process takes the most amount of time. Discovery is a general term for many types of fact-finding and informational gathering methods.

During the discovery process, the parties may ask each other questions in writing under oath, called interrogatories. Interrogatories can come in different forms. Special interrogatories allow one side to ask any other party any questions he or she wants, barring applicable objections. The questions can be in any form and can ask about facts that are specifically related to the case.

On the other hand, form interrogatories are submitted on a standard form, ask basic questions about background, etc., and boxes are simply checked (questions are not written). Form interrogatories also have sections where routine, standard questions for the most common types of civil litigation cases are asked.

Parties may also ask each other to admit or deny certain facts in writing under oath, called requests for admissions. Parties may also schedule the deposition of any other party or witness. A deposition is a verbal examination where an attorney asks a witness questions under oath and while the questions and answers are recorded by a stenographer or electronically or both. Deposition witnesses can be any type of witness, including expert witnesses and eyewitnesses.

The discovery process and the questions permitted in the discovery process are very different that the types of questions permitted in court. Most importantly, during the discovery process and unlike during testimony taken in court, the relevant standard is dramatically relaxed. In court, questions must be relevant to the issue being discussed – any objection to irrelevant facts will be granted (sustained) and that information will not be admissible (the judge or jury, whoever is deciding the facts in the case, cannot consider irrelevant evidence when making their determination).

In contrast, during the discovery process, irrelevant questions or other types of discovery seeking seemingly irrelevant information is permitted if it will reasonably lead to the discovery of relevant information. This is why attorneys often ask wide-ranging questions about many topics. These lines of questions are generally permitted, and courts will enforce the rights of parties to ask these kinds of questions.

Motions – Either side may bring different kinds of written motions during the course of the case. Motions are requests to the judge to make a certain order, such as dismissing a case altogether or ordering certain pieces of evidence inadmissible. The most common type of motion in most civil litigation and business litigation matters is the motion for summary judgment, also known as a motion for judgment based on the pleadings. In a motion for summary judgment, one side generally asks a judge to decide the entire case without a trial. However, a summary judgment is only allowed when the side requesting the motion successfully alleges that even if all of the factual, (not legal), arguments made by the other party are true and uncontroverted, the case must still be decided in the requesting side’s favor.

Trials – Trials are where the factual questions, (such as eyewitnesses testimony about what he or she saw), in a case are decided. Factual questions can be decided by a judge or a jury, whereas legal questions can only be decided by a judge. Either side may request a jury trial. If neither side requests a  jury trial, the judge will decide all factual issues as well as legal issues. Regardless of whether or not the facts are decided by a jury, the trial process is the same.

In a trial, each side presents an opening statement, an outline of what it believes the evidence will show.

Next, the plaintiff is permitted to introduce evidence such as exhibits and witness testimony.

The defendant is permitted to cross-examine all of the plaintiff’s witnesses. After the plaintiff rests, the defendant is also permitted to introduce evidence such as exhibits and witness testimony. The plaintiff is permitted to cross-examine all of the defendant’s witnesses. After the defendant rests, the plaintiff may be permitted to introduce additional evidence to rebut the defendant’s evidence.

Each side may have multiple opportunities to introduce additional evidence if the evidence rebuts the evidence the other party most recently introduced. Once the evidence has been introduced, each side receives an opportunity to present its closing arguments.

The plaintiff presents its closing argument first, followed by the defendant, and followed an additional time by the plaintiff, (the plaintiff goes first and last because the plaintiff is the party with the burden of proving its allegations). After closing arguments, the judge reads the jury a set of instructions. Those instructions provide the law the jury must follow and then directs the jury on the manner in which it is required to apply the law to the facts and ultimately reach a verdict.

Obviously, in a non-jury trial, those instructions, while still important, are simply agreed to by the attorneys and the judge and the judge then follows those guidelines when making his or her determination of what factually occurred in the case.

In Los Angeles, and throughout California, jury trials are not provided for free for litigants and a jury trial is only permitted if requested prior to the first Case Management Conference. While a judge may use his or her discretion to permit one side to request a jury trial after that Case Management Conference, the right to that jury is not automatic at that point.

Further, the side requesting a jury must, at the time of the request, pay $150 in Los Angeles as a jury fee. If this fee is not paid, the request is not considered valid. Prior to this rule, a party, as little as 25 days prior to trial, could simply request a jury trial by form and was not required to pay any fees.

Not all cases follow these same jury trial rules. Criminal jury trials are presumed, cost nothing, and no request is required (in fact, a waiver of a jury must be taken to have a court trial). Family law, restraining orders, and probate matters all are not cases that are eligible for jury trials, unlike regular civil litigation matters.

Unlawful detainer matters can be heard before a jury in California. A civil jury trial (or any other type of jury trial) should never be confused with a grand jury in California, which only has the authority to indict criminal defendants, not convict or render any final judgments.

Most courts, like the Los Angeles Superior Court, make fee schedules (for filing and for other fees) available to the public online. In other cases, fee waivers are available via the local form.

Appeals – The losing side in a trial may appeal. However, appeals only consider whether the judge made the correct legal decisions. Appeals do not consider whether the judge made any incorrect decisions about the facts, and appeals do not consider the jury’s decision about the facts. An appellate court can deny an appeal, grant a new appeal reversing a part or all of a case, or can order a new trial. A summary of important appellate issues is below  (or navigate to more specific and detailed information concerning the process of appealing civil matters).

Important Business Litigation Issues – Often, the best way to avoid many business-related disputes is to have a properly executed agreement. However, even a perfect contract that leaves no room for interpretation can be breached. When that occurs, a party will rarely be fully compensated without legal help. While the civil litigation process does not officially begin until a lawsuit is filed, that daunting step can sometimes be avoided if the parties are proactive and work to resolve their dispute.

Often, involving attorneys can save money, especially if the attorneys place their Clients’ interests first. When a lawsuit is filed or is imminent, arbitration and mediation can be viable alternatives to the costly process of litigation and trial. Arbitration is more similar to the court process and involves a decision from an arbitrator. This decision can be binding or non-binding (the parties must agree if arbitration is to be binding). Mediation is simply a negotiation with an impartial referee or mediator who is hired by both parties to bring them closer to a resolution/settlement.

Many businesses and individuals see the litigation process as intimidating because of the rising costs of hiring qualified attorneys by the hour. Some inexperienced attorneys will accept cases for much less money than experienced business litigation attorneys.

However, these new lawyers can end up charging as much or more than an experienced civil litigator because they will be forced to charge their clients to learn new concepts. Despite the high cost of civil litigation, there are a lot of knowledgeable and highly experienced business litigation attorneys who do everything possible to provide excellent representation at a reasonable price.

Their goal is not to charge fees but instead is to keep costs down and assist clients. This policy can dramatically benefit their clients. Some civil litigation attorneys also accept fees on a contingency basis, meaning that the attorney only receives a fee if the client obtains money in a settlement. However, these types of fee agreements are generally only offered in personal injury cases, (such as a car accident, etc.).

Our firm regularly handles all types of business and civil litigation, including contractual disputes, real estate matters, collection litigation, insurance disputes, shareholder and partner disputes, and civil appeals. Having an experienced and qualified civil litigation attorney advocating for you or your corporation can make a significant difference in the outcome of a case.

Having an experienced attorney can also reduce the fees clients pay (less experienced litigators regularly bill clients for time spent researching an issue or procedure that is new to them, where an attorney in practice for many years has often handled similar matters in the past and does not need to spend time familiarizing himself or herself with every new issue).

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.

Appellate Cases

When appealing a judgement, usually only a final judgement can be appealed, such as a jury verdict, a verdict by a court in a non-jury trial, a demurrer, (a motion to dismiss the case at the initial proceedings), or a judgment granting “summary” relief to one side, (a motion alleging that there are no issues of fact that are disputed, only legal issues need to be decided).  Appeals must also always be filed within a certain time deadline; that deadline will vary depending on the specific facts of a case. Prior to an appeal being filed, however, a notice of appeal must be filed in the court where the decision or judgment was made.

In an appeal, the appellate court does not consider new evidence, they make their decision based on the record, (transcript, pleadings [motions], documents entered into evidence, and other physical evidence), from the trial court. An appeal cannot be successful if the side requesting the appeal only wishes to introduce new evidence that was not improperly excluded.

Appeals are also only successful if the error by a court, with respect to evidence or a legal issue, is reasonably likely to change the outcome. Therefore, when the error is “harmless,” the appeal will not be granted. Further, some appeals, such as appeals of a summary adjudication, will be decided on “de novo” grounds, (decided without the appellate court giving any deference to the trial court’s decision or reasoning). Other types of appeals are decided on an “abuse of discretion standard,” where full deference to the trial court’s decision is given and only an error that defies reason will be reversed.

There are always alternatives to filing an appeal in California. First, litigants unsatisfied with the results in a given case can request a court to change its decision when filing a motion to vacate a judgment. While a procedurally viable, in cases where the court is the finder of fact, a motion to vacate a judgement is essentially asking a court to change its mind and reverse a decision he or she has previously made. The likelihood of success depends on the circumstances.

This type of relief is appropriate prior to the filing of an appeal but after a judgment has been entered (after a decision by a court, a proposed judgment must be submitted and approved by a judge).

Another alternative to an appeal is a request for a new trial. After a jury trial, a judge may order a new trial for a number or reasons such as an inappropriate amount of damages, a lack of evidence to support a verdict, any type of jury misconduct, or many other factors that would have a sufficient and unintended influence on the outcome of the case.

A final alternative to an appeal is a motion for reconsideration. This type of request asks a judge to reverse his or her course during litigation based on a change in facts, law, or circumstances. For instance, if a litigant was not aware of a fact but becomes aware shortly after the case concludes, he or she can request the court take the new fact or facts into consideration. Further, if a judge bases his or her decision on case law that was binding at the time of the decision, and a higher court then overrules the law the judge based his or her decision on, a motion for reconsideration would be appropriate.  A final alternative to an appeal in California is a motion for a new trial or judgment not notwithstanding

If an alternative to an appeal is not feasible or appropriate, there are time limits for filing an appeal. In a civil litigation matter where the amount in question is more than $25,000, a notice of appeal must be served and filed less than 60 days after the court clerk or other parties sends you a notice, (or stamped copy of the judgement), that the judgement has been served or 180 days after the entry of judgement, whichever is first.

In a civil case where the amount in question is less than $25,000, a notice of appeal must be served and filed less than 30 days after the court clerk or other parties send you a notice, (or stamped copy of the judgment), that the judgment has been served or 90 days after the entry of judgment, whichever is first.

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.

Contractual Disputes

When one side fails in its obligations, the solutions usually fall into one of three categories: performing the terms of the contract, such as delivering a promised item, money damages, the payment of money to compensate the other side, including repayment and/or future payments, and the cancellation of the contract.  Requiring either side to fulfill the terms of a contract (such as forcing one side to deliver title to a piece of real estate or real property once the purchase price has been paid) is not always a realistic option (such as contracts involving services).

Damages are also broken down into two categories: money damages (compensatory) and punitive. Money damages also come in different forms: one kind is generally designed to place one side in the situation he, she or it, in the case of corporations, would have been had the breach of contract not happened. The second type of damages (special damages) are the easiest to quantifiable type of damages that exist because the can be easily calculated and added up. Examples of special damages would include opportunity costs (consequential damages). and out of pocket losses such as repair costs, when personal property or real property is damaged. or lost wages or earnings, called incidental damages.

Special damages that are classified as consequential damages for lost wages or opportunity costs must be definite and reasonable. On the other hand, incidental costs are often definite. Less or non-quantifiable damages are allowed but must be reasonable. Good examples of this type damages are “non-economic” losses such as emotional damages, damages for loss of enjoyment or pleasure, or damages for  physical pain and suffering.

Punitive damages exist to punish a party for outrageous behavior, and their purpose is to discourage that party or other parties from acting in a similar way. Because they are the hardest of any type of damages to quantify, many jurisdictions place a cap on punitive damages so they do not exceed a certain multiple of compensatory damages. Punitive damages are also generally not awarded in claims for breach of contract, although it is possible. More often, punitive damages are awarded when a defendant in a personal injury claim is unusually bad. A breach of contract can be “material” or “immaterial.” A material breach involves a significant or actual problem with the performance, not a non-important failure.

Other types of damages do exist. Sometimes when a monetary or real property reward cannot be established, an award of nominal damages may be given. Occasionally, states, including California, assign amounts that victims of certain types of conduct must receive from the wrongdoer. These types of statutory damages can be increased depending on the type of conduct and the degree of repetition of the conduct. A good example of statutory damages is the case of non-return of a renter’s security deposit.

In California, the party that wins a lawsuit may recover costs of the suit after the matter is disposed of. Examples would include filing fees, jury fees, and other out of pocket expenses. However, in California, as in the rest of the United States, unless a contract specifically provided for the payment of attorneys’ fees, even the victorious party may not recover those attorney’s fees – many contracts do have clauses that state that attorneys’ fees will be paid by the losing party in the event that one side seeks them after a lawsuit.

When attorneys’ fees provisions are present, the amount requested still must be reasonable, be expressly recorded and disclosed, and must align with the amount of hours spent on the case. The fees must also be reasonable and not excessive when compared to other attorneys’ rates. Finally, the amount of hours and the rate must be approved by a judge before an award of attorneys’ fees can be made.

Always be sure to contact an experienced litigation attorney before making any substantive decisions about a lawsuit or prospective lawsuit.

Real estate and construction disputes are especially common types of civil litigation disputes. Many commercial construction project results in at least minimal litigation. Because there are so many contractual obligations involved in a major commercial construction undertaking, a litigation-free project is rare. Our attorneys have over 70 representing Clients and have extensive experience litigating commercial construction projects. Past construction-industry Clients include Familian Pipe and Supply, T.M. Cobb, Wells Fargo Alarm & Guard, and many others. Litigation regarding construction projects can take many forms and have many different parties such as general contractors, sub-contractors, real estate agents, real estate brokers, material suppliers, laborers, developers, buyers, and owners.

Typical subjects that surround construction litigation include failure to complete work in a timely manner, the use of materials accepted in the industry, engineering defects, structural defects (roofing leaks, piping insufficiencies, foundation problems, and drywall issues), and many more. More than any other issues, the problems of delays in completion and structural defects come up often. However, to prevail in a civil action in connection with a construction defect, it must be shown that the defect was material and resulted in monetary damages. Construction delays often have defenses as well, as excusable work stoppages or unanticipated problems may alleviate liability for some parties.

Despite the high number of lawsuits that arise out of major construction projects or similar projects, the best defense to litigation is often preventative – having contracts that clearly define the duties and responsibilities of each party so that no ambiguity regarding the terms arises later. While unexpected circumstances regularly exist, the fewer there are the less complicated (and therefore less expensive) the inevitable litigation becomes. Each additional issue that is conclusively resolved in the contract-formation stage is one less potential issue that must be decided during litigation. The goal of contract formation prior to a construction process should be two-fold. First, the agreements between all parties should be thorough and cover all foreseeable contingencies. Second, the contracts must be clearly written with key provisions unambiguously articulated. A qualified and experienced civil litigation attorney can also always assist with the review of agreements related to a prospective project.

Insurance claims, a part of contractual litigation, arise in a variety of dispute contexts including property, commercial, and professional liability. It covers first-party coverage suits, complex litigation, routine coverage, arbitration, reinsurance matters, and appeals. An insurance policy is essentially a promise from an insurance company to protect the policy holder, the insured. Insurance companies owe a duty of good faith and fair dealing to every person or company they insure which means you can bring a claim against your insurance company if they act in bad faith—when an insurance company fails to treat one of its insured fairly under the law. Common acts of bad faith include failing to quickly process a legitimate insurance claim, demanding unreasonable documentation from a policyholder to back up their claim, and claiming to have lost or never received important documentation from the policyholder. If your insurance claim is being delayed or denied, or if you are an insurance company who has had an invalid claim filed against you you may need an experienced insurance litigation attorney to handle your case.

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.

Alternatives to Litigation

Alternative dispute resolution (“ADR”) consists of arbitration, mediation, early neutral evaluation, conciliation, or negotiation; each of which has its own different advantages and disadvantages. Whether one side decides to go with ADR, settlement or the traditional litigation route leading to court trial or jury trial depends on many factors. First, whether to engage in ADR is often based on whether a contract provision in an agreement between the parties mandates it. That is, many standard form contracts contain boilerplate language that states that if a dispute arises between the parties to the contract, ADR (rather than filing a lawsuit in a court) is the required route.

When and Why ADR is a Good Choice – The first reason to choose ADR is money. Each method of ADR has a number of advantages that make it a much more attractive option than civil litigation. The most important are that they save a tremendous amount of time and money. Because of the informal nature of ADR (as opposed to trial in litigation), parties often find themselves resolving their disputes much sooner and quicker than a trial. This is because preparing for a civil involves extensive amounts of paperwork and hours clocked by attorneys, paralegals, and staff. This work includes drafting a complaint, motions, and discovery, all of which require a significant amount of research and motion drafting. Most importantly, when parties decide to use ADR, the common practice is for the total cost to be split equally among the parties.

Time also tends to add up when going through the civil litigation process, and ADR can be a valid way to save time. Litigants involved in the civil litigation process and not the ADR process must wait for significant periods of time to obtain responses to discovery, and propounding discovery also consumes time. Moreover, it is not uncommon for parties to request an extension of time to respond to discovery or motions. Finally, impacted court calendars and backlogs lead to serious delays when scheduling necessary motions and obtaining a trial date.

By choosing the ADR route, parties can almost certainly expect to resolve their disputes within a matter of months, even weeks, as opposed to the year or more they may need to wait for a trial date. In addition, ADR is often binding and parties have less appellate rights, (or sometimes, basically no appeal rights) after a judgment is entered. This lack of appellate rights often leads to the case ending in a more timely manner rather than waiting for it to wind its way through the appellate process, which can take years.

In addition to the great deals of time and money that can be saved, parties can expect to have an increased degree of control over the entire process as well as the outcome. During the normal civil litigation process, the attorneys usually have sole discretion in how to proceed with respect strategy. In other words, the attorney is responsible for the means to achieve the goal, whereas the client is the one who decides what the ultimate goal is. Parties in ADR, however, have more opportunities to engage in the process. When mediation is the mode of ADR, parties are actually allowed to participate in discussions with the mediator and can contribute to the prospective resolution.

Finally, ADR tends to breed increased overall satisfaction by both parties as opposed to in a trial where there is usually one winner and one loser.

Despite there being a winner and a loser, that does not always mean that the winner is completely fulfilled with the outcome of the case either (especially if a trial yields a lower award than expected or the winner is forced to sacrifice or compromise more than he or she originally intended). Likewise, the loser is almost never happy with the outcome of the case as he or she could feel uninvolved in how a trial was conducted.

Although ADR is defined as any means of resolving a dispute other than litigation, the most common are arbitration and mediation. Arbitration and mediation both have their advantages, so whether a party chooses one or the other will depend largely on the type of case, how much they are willing to work towards coming to a resolution, and what their desired outcomes are.

There are important differences between the types of ADR and those differences can have a major impact on the outcome of a given case, depending on the facts and parties.

Mediation involves a neutral, impartial person called the “mediator” that helps the parties reach a mutually agreed-upon resolution.

Contrary to popular belief, mediators do not decide the case for the parties, advocate for either party or give advice (legal or not). In fact, mediators are trained to facilitate styles of communication so that the parties feel they reached the agreement themselves.

Mediation is ideal in cases where the parties wish to have an ongoing relationship. Therefore, mediation is most beneficial when the parties are family members or business partners. Mediation is also best for situations where the dispute was caused in part because of emotions that end up becoming obstacles to reaching a resolution. The training a mediator receives is most practical when trying to sort out each party’s emotions, helping them see the cause of the problem, and what is necessary to resolve it.

Other significant advantages to mediation exist. Mediation is almost always faster than a trial, and can be faster than arbitration because of its lack of formality. In mediation, evidence is not presented, it is discussed, and this discussion can take reduce the time that it takes for the mediator and the parties to get to the heart of a given issue. Mediation can also be less costly than arbitration – mediators are present to facilitate a resolution, not to decide the facts, and as a result it is not as essential that he or she is prepared to the same degree as an arbitrator.  Parties are also less likely to fail on obligations imposed during mediation as opposed to conditions imposed during trial, because they have been agreed to rather than ordered by a judge or arbitrator. This leads to less of a backlog for the courts and a reduction in legal fees paid by the parties when attempting to enforce agreements or court orders.

The success of mediation in facilitating the resolution of disputes has led many courts throughout the country, including many in California and Los Angeles, to order or strongly encourage mediation. While compulsory mediation may negate some of its benefits, the overall positives of engaging in mediation can often outweigh any roadblocks.

Mediation can also prevent lawsuits from being filed in the first place, its function is not just to stop the litigation process once it’s begun. If both parties to a dispute either have a mediation clause in the contract that led to their dispute, mediation or arbitration may be required. Even if they are not required, mediation, if both parties agree, will often allow each side to relay its position and can cause a deeper understanding of the other side’s concerns. This type of understanding can stop narrow views of

Arbitration, on the other hand, involves a neutral person called an “arbitrator,” who is frequently a retired judge or attorney. The arbitrator hears the arguments and evidence from all parties and subsequently decides the outcome. In this way, arbitration greatly resembles a trial but is still on a much smaller and more informal scale. Unlike in a trial, the rules of evidence and procedure that traditionally must be fully complied with are much more relaxed and less rigid.

Additionally, unlike a mediation or trial, the parties can choose whether they want the outcome of the arbitration to be legally binding or non-binding. A binding arbitration requires the parties to waive their constitutional right to a trial and agree to accept the arbitrator’s decision as final—regardless of whether it is in their favor or not. Following an arbitrator’s decision, the parties do not have the right to appeal (as they would in a trial). A non-binding arbitration is the opposite—after an arbitrator has decided the dispute, the parties will still have the opportunity to request a trial, should they choose not to accept the arbitrator’s decision.

Arbitration is ideal in cases where the parties wish to have the protections a trial affords, (like having someone decide their case for them) but would like to avoid the formality, time, and cost of a trial. It is also best when the case is complex or one in which the experience of an expert in the field of the case would be beneficial to one or both parties.

Although there are more methods of ADR than just arbitration and mediation, the general principle of choosing ADR over a trial is the same: less formality and a quicker, more inexpensive resolution. Whether a party is required to go the ADR route will often hinge on if there a contract provision mandating it, and if not, what the parties decide together.

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.

Collection Litigation

Collection litigation encompasses the process by which debt collection agencies or corporations collect accrued debt from various individuals or corporate entities. This includes enforcing obligations that arise from ongoing business relationships in a creditor-debtor context as well as the purchase and sale of goods or services under the Uniform Commercial Code. The most common actions in collection litigation are breach of contract and common counts (usually an account stated in writing or goods sold and delivered).

Experienced collection litigators use a wide variety of strategies and tools including foreclosure, suit against guarantors, garnishing wages, seizing bank accounts, freezing assets, and filing liens on individual or corporate property. Additionally, collection litigators often use private investigators, conduct online asset searches, and search client files to determine if a collection judgment will be enforceable. Collection judgments are most commonly executed against the following:

• Personal property
• Real property
• Stock shares
• Money orders
• Debts due to the debtor
• Checks
• Interests in property from the estate of a decedent

One of the most important concerns when dealing with a collection dispute is determining why the non-paying party failed to meet its financial obligations. If the non-paying party (commonly called the debtor) simply lacks the ability to pay, a collection judgment may not even be enforceable. To properly asses the enforceability of a collection judgment, you should consult an experienced collection litigator who will know and understand the appropriate state laws, like Chapter 9 of the California Commercial Code which determines the enforceability against collateral other than personal property in a retail installment sale or conditional sales contract.

Judgment debtor exams are legal proceedings that one side may conduct after a monetary judgment by a court has been entered. Once a judgment instructing a party to a dispute to pay money has been entered, the party whom the judgment was entered in favor of has the right to collect money owed and has the right to schedule a judgment debtor exam if all funds are not paid. Appearance by the debtor, (also known as the individual who owes the money) is mandatory.

Failure to appear at a judgment debtor exam can result in a contempt charge. Often, judgment debtor exams can and are canceled after a payment arrangement is worked out between the parties. Judgment debtor exams can occur after many types of civil judgments are entered (they are not held in criminal matters). They can occur as a result of judgments stemming from breach of contract cases, negligence cases, and any other type of judgment for tortious conduct (all civil wrongs other than a breach of contract).

At a judgment debtor exam, the party to who the money is owed may ask the debtor, under oath, detailed questions about his or her income and finances. Such questions may concern employment salary, proceeds from investments, gains from inheritance or gifts, and personal and seemingly invasive questions. It follows that anyone seeking to collect a judgment (or anyone against whom collection of a judgment is sought) should have the expertise of a qualified attorney with experience in judgment debtor exams by his or her side. Also at a judgment debtor exam, the party to who the money is owed may ask the debtor, under oath, detailed questions about his or her income and finances.

At an exam like the kind described, debtors also must be careful not to violate the California Fraudulent Transfers Act, designed to prevent the hiding of assets for the specific purpose of avoiding or inhibiting another party to litigation from collecting on a valid judgement. Typically, litigants who violate this act transfer money or real property to a trusted source during litigation or when the prospects that he or she (or a corporation) will not be successful in the litigation.

These types of transfers are not allowed if the purpose was to avoid payment. While some legitimate transfers are permissible, such as selling a home or other assets for valid consideration in return, many acts that violate the Fraudulent Transfers Act involve transactions to family or friends or other parties where adequate compensation is not given.

Except in cases involving fraud or other where punitive damages are awarded,  bankruptcy protection is available to most corporations and individuals in debt. Individuals who are considered insolvent cannot be penalized in any manner, except the collection of any debt not discharged in bankruptcy (one exception exists in California: parents or guardians delinquent in child support payments may be sentenced to custody in county jail if these types of payments are not made and a judge determines the individual not making the payments can afford to pay and has no legitimate reason for not paying child support).

Even if money (excluding child support) was obtained via fraud (and criminal charges have not been filed), only wages, other income, personal property, and real property may be attached and seized as a result of a monetary judgement. Another exception exists in Nevada, where the failure to pay a casino on money loaned, also known as a “marker,” can result in criminal charges and custody. In criminal cases in California involving theft or misappropriation of funds, sometimes the return of stolen money can result in a reduction or elimination of custody. Sometimes, the debtor can threaten or actually file for protection under the United States Bankruptcy Code.

While collection of monies in fraud cases is often easier for the owner of a debt to procure, not every case involves fraud. Therefore, a litigant (here, a plaintiff) cannot simply allege fraudulent conduct and preclude a debtor from taking advantage of the bankruptcy laws or other asset protection techniques.

First, it should be noted that courts generally frown on parties alleging fraud in traditional breach of contract cases. Absent other facts, simply breaching a contract does not constitute fraud. For fraud to be present, there must be some kind of intent to deceive on the part of the side being accused of fraud or misrepresentation.

The necessity of intent in misrepresentation or fraud cases sits in sharp contrast to an act of  negligent misrepresentation. If an individual or business makes a misrepresentation that later proves to be incorrect, that does not, by itself, rise to the level of fraud. For fraud to exist, the side making the false statement must have known or reasonably should have known that the statement was untrue at the time it was made.

Further, a fraud allegation must be more specifically alleged than other allegations, and must be described with particularity. For example, in a complaint, a party only needs to allege a contract was breached and does not need to allege other specific facts. However, if a fraud allegation is made, the complaint must describe what behavior led to the fraud being alleged. Typically, if fraud is alleged in a breach of contract action without sufficient evidence to support actual intentional misrepresentation, the side being accused of fraud (if properly advised) will file a demurrer.

A demurrer is a motion asking the court to dismiss the matter entirely or dismiss specific causes of action because, even if what is alleged in the complaint is true, there is no legal basis for the claim. This is different to a motion for summary judgement, where the sufficiency of the evidence is questioned.

Most debts, after bankruptcy protection is granted, are not recoverable. However, there are times when certain debts are not “dischargeable,” such as judgments resulting from monetary gain through fraud. Fiduciary Duties A fiduciary duty is a legal or ethical relationship of trust between two or more parties. Under CA law, a party can sue for breach of fiduciary duties if four requirements are proven: (1) a fiduciary duty did indeed exist, (2) that fiduciary duty was breached, (3) proximate cause (which means you have to show that the breach was sufficiently related to the fiduciary duty), and (4) injury or damages.

Fiduciary duties arising in business require that the fiduciary (the person who owes a duty) execute due care when dealing with the money and funds entrusted to it on behalf of the principal (the person to whom a duty is owed). For example, directors and officers of businesses owe fiduciary duties such as a duty of care and a duty of loyalty to the business and its constituents. A duty of care requires that the fiduciary be adequately informed when making a decision on behalf of the interests of the principal.

The duty of loyalty requires that the fiduciary act in the best interests of the business entity. Most business directors and partners, mortgage brokers, financial planners, shareholders, real estate agents, as well as escrow agents (and the list could go one) have fiduciary duties.

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.

Types of Civil Actions

Even with this tool, the filing party must know how his/her case is classified in order to know which court location is proper. This tool allows you to enter the city, community, or zip code that is nearest or most accessible to you or where the dispute arose and will give you a list of appropriate courthouses that you can file your case in. If you do not know this information, then the tool offers a second option that lets you choose which courthouse is nearest to you (or recognizable) from a drop-down menu.

The first step in determining where to file one’s lawsuit is knowing what kind of case you have, as each courthouse only handles certain types of cases. The next step is to determine how much money is involved, or at stake, in the case, you wish to file. Under the “civil” umbrella, there are unlimited civil cases (that exclude or include personal injury cases), limited civil cases (that exclude collections or include collections), limited unlawful detainer cases, and small claims cases.

Cases involving family matters (such as child custody, support, alimony, or divorce) or probate matters (administration of a deceased’s estate, wills, or trusts) are handled in an entirely separate courthouse from civil or criminal matters.

Knowing precisely what type of case you are filing, as well as how much money is involved, is key to determining where to file your lawsuit. Descriptions of all types of matters are below so you can determine where to file.

Unlimited Civil Matters -An unlimited civil case is a general civil case that involves an amount of money over $25,000. While the majority of unlimited civil cases involve money, this term also includes a number of other types of cases as well. Cases that are filed for the purpose of determining or resolving questionable title to real property also referred to as “quieting” title, are also considered unlimited civil cases.

In addition, a case wherein an individual requests a civil restraining order or where someone wishes to change his/her or his/her child’s name is also considered an unlimited civil case. Essentially, an unlimited civil case is any case that does not fit within the definition of a limited civil case under the Code of Civil Procedure, Section 85-89 (discussed below).

Limited Civil Matters – Limited civil cases, on the other hand, are general civil cases that involving seeking monetary damages of up to $25,000 (so, any case that involves $25,000 or less). Many cases that fall under this category include things such as auto torts, personal injury, property damage, employment, unlawful detainers, or small claims appeals.

According to the Code of Civil Procedure, Section 85-89, an action or special proceeding will be treated as a limited civil case if three conditions are met: (i) the amount in controversy (the amount of the demand or recovery sought) does not exceed $25,000, (ii) the relief sought is the type that could actually be granted in a limited civil case, and (iii) the relief sought is exclusively the type that is described in one or more statutes that classify an action as a limited civil case.

Unlawful Detainer Matters – Unlawful detainer cases fall under limited civil matters and involve repossession of real property from someone who is wrongfully in possession. Unlawful detainer suits are most often filed by landlords (but not exclusively) who want to end a tenancy involuntarily after a tenant has taken possession of the rental premises but must take certain legal steps before doing so. Essentially, an unlawful detainer case is an accelerated method to recover possession (meaning actually occupying the premises) of real property.

These are limited proceedings specifically designed to allow landlords (or other similarly situated individuals) to repossess real property from a tenant who is wrongfully in possession. Although an unlawful detainer falls within the definition of a limited civil case, they are typically filed in different courthouses than general limited civil cases, depending on where the real property or rental premises is located.

Small Claims Matters -Small claims cases are ones that do not fit within the definition of either unlimited civil cases or limited civil cases. Whether a case is classified small claims depends on who is filing and the amount of money involved. Specifically, if you are an individual or sole proprietor, you can sue in small claims court for up to $7,500, or if you are a corporation or other legal entity, the limit is $5,000 (and parties cannot file more than two claims in any court in one calendar year).

Cases involving amounts that exceed these limits will have to be classified as a general limited civil case, and as such, filed in the proper courthouse. In Los Angeles County, the courts that hear small claims matters are located in Downey, Alhambra, Stanley Mosk (downtown Los Angeles), Van Nuys East, and Inglewood. (Local Rule 2.3). A small claims case wherein a party seeks damages for injuries to a person or to the personal property of a person should be filed in the “nearest or most accessible” county to where the injury occurred or where the defendants (any of them) reside at the time the action commenced.

Like ownership/possession of property disputes, this means that personal injury disputes can be filed in more than one court if there are multiple defendants that live in different counties. (CCP § 395).In addition to who is filing, where a small claims case is filed also depends on the type of case.

For example, with contract disputes, the case should be filed in the “nearest or most accessible” county where the buyer signed the contract/purchase order, where the buyer resided at the time the contract/purchase order was entered into or where the buyer resides at the commencement of the action. (CCP §§ 1984.4, 1812.10).

Ownership/Possession of Real Property Disputes – For disputes over ownership or possession of real property, the case should be filed in the “nearest or most accessible” county to where the property is located or where the defendants (any of them) reside. In other words, this type of case can be filed in more than one location if there is more than one defendant each residing in a different county. (CCP §§ 392, 760.050, 872.110).

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.

Litigation Fee Structures

The most important factors are the amount of time spent towards each step of the client’s case, the attorney’s ability, experience, reputation, novelty, the difficulty of the case, the results obtained, and the costs involved. An attorney’s overhead costs are typically factored into a client’s overall bill. These include things such as the attorney’s office rental cost, staff salaries, legal research and books, utilities, office equipment, computers, etc.

The fee structure that an attorney ultimately employs usually must align with the area of law that he/she practices. Most civil and business litigation law firms and solo attorneys use the billable hour fee structure, and flat fees are frequently used when the case is relatively simple or routine, such as a will or an uncontested divorce. However, auto accident cases are notorious for using a contingency fee structure, which is ideal for clients who may not have the necessary finances.

These include things such as the attorney’s office rental cost, staff salaries, legal research and books, utilities, office equipment, computers, etc. The fee structure that an attorney ultimately employs usually must align with the area of law that he/she practices.

Most civil and business litigation law firms and solo attorneys use the billable hour fee structure, and flat fees are frequently used when the case is relatively simple or routine, such as a will or an uncontested divorce.

However, auto accident cases are notorious for using a contingency fee structure, which is ideal for clients who may not have the necessary finances up front but have a strong argument to receive compensation from the defendant for his/her injury.

Hourly Fee – A billable hour fee structure tends to be the most accurate and simple to implement, and as such, is most commonly utilized in the majority of areas of law. In this structure, the attorney gets paid, and the client gets charged an agreed-upon hourly rate for the hours (or portions of an hour) he or she works on a client’s matter until it is resolved.

For example, if the lawyer’s fee is $10 per hour and the lawyer works 5 hours, the fee will be $50. It is important for clients to know, that attorneys may only charge for tasks that are directly related to building a case. In other words, “billable hours” do not account for the miscellaneous time that an attorney is at work, has lunch, or other unrelated matters.

Again, most civil litigation attorneys use the billable hour model. Sometimes, attorneys may charge different fees for different types of work, such as charging a lesser amount for performing legal research than what the fee would be to make a court appearance. Each type of work is typically scaled so that it accurately reflects the experience required to perform the work and the amount of actual worked required to complete the task.

In this billable hour fee structure, it is important to keep in mind that associate junior lawyers working in large firms typically have a different fee scale from the more senior attorneys or partners, who almost always charge much higher fees than the young associates and paralegals. Again, their experience and reputation reflect the hourly rate that they can charge clients.

Each type of work is typically scaled so that it accurately reflects the experience required to perform the work and the amount of actual work required to complete the task.

In this billable hour fee structure, it is important to keep in mind that associate junior lawyers working in large firms typically have a different fee scale from the more senior attorneys or partners, who almost always charge much higher fees than the young associates and paralegals. Again, their experience and reputation reflect the hourly rate that they can charge clients.

Contingency Fee – A contingency fee, on the other hand, is an agreement between a client and his/her attorney that offers the client a chance to hire the attorney without having to pay any initial payment. Most common in personal injury (car accident, etc.) matters contingency fee arrangement also generally offers no monthly legal bills (as the case is ongoing) and offers the attorney the opportunity to be paid an agreed-upon percentage of the total amount recovered, once the trial or settlement are complete.

Attorneys sometimes require clients to pay for certain expenses and expert fees in contingency cases – other times the attorney is responsible for all costs. A contingency fee is meant to help those who do not have money for attorneys or who do not have easy access to the courts by making allowing them to pay for legal services out of the prospective recovery.

Attorneys sometimes require clients to pay for certain expenses and expert fees in contingency cases – other times the attorney is responsible for all costs. A contingency fee is meant to help those who do not have money for attorneys or who do not have easy access to the courts by making allowing them to pay for legal services out of the prospective recovery.

A benefit of the contingency fee arrangement is that the attorney’s interests are aligned with the interests of the client, as the attorney is only paid if the client is paid. Some civil litigation attorneys accept contingency fee agreements in many cases, while others accept them only for some cases or accept partial contingency cases (a hybrid of contingency and hourly fee). Other attorneys accept no contingency matters.

Flat Fee – Flat fees are self-explanatory—the attorney charges the client a flat rate, regardless of the amount of work done or the type of work. Common in criminal law, immigration, bankruptcy (and less common in civil litigation and business litigation matters), this fee can be paid upfront or it can offer the client the opportunity to pay the fee in increments, notwithstanding the outcome of the matter. Flat fees are calculated based on the level of experience of the attorney, as well as any facts presented by the client and the type of case.

Using a flat fee arrangement can be a gamble for both the attorney and the client. This is because once the attorney and client have agreed on a flat rate, reduced it to writing, and signed the writing, then the fee must be paid despite the amount of time spent on the case. Many clients prefer the predictability of flat fee, as the cost of hiring an attorney can at times prove volatile. This is countered with the advantages, above, of non-flat fee arrangements, such as having an attorney aligned more closely with the client.

Flat fees are calculated based on the level of experience of the attorney, as well as any facts presented by the client and the type of case. Using a flat fee arrangement can be a gamble for both the attorney and the client. This is because once the attorney and client have agreed on a flat rate, reduced it to writing, and signed the writing, then the fee must be paid despite the amount of time spent on the case.

Many clients prefer the predictability of flat fee, as the cost of hiring an attorney can at times prove volatile. This is countered with the advantages, above, of non-flat fee arrangements, such as having an attorney aligned more closely with the client.

Which Fee Structure to Choose -When researching which fee structure is best for you, it is important to consider the larger issues, such as the type of case, how complicated the matter is, the experience needed to complete the task, etc. Without carefully considering the options, one runs the risk of paying more than he/she expected, or not getting the outcome he/she wanted because the fee structure did not properly fit the client’s case or budget.

Contractual disputes or allegations of a breach of contract are common in business transactions. A breach of contract occurs when one side of a contract only partially fulfills its duties, fails to perform a contract in the time required by the agreement, or when one side fails to act at all.