has provisions in it for terminations of the employee the contract is not a truly at will contract is that in the sense that in a typical out will contract either party can walk away at any time without any burden but it looks like the contracts at least it seems rather clear to me the defendants could terminate mr clunes at any time without cause section i that the board can terminate for cause in which no payment needs to be made to the employer in that type of terminations or under paragraph five as your honor has indicated  he's not yet well in the sense that the district has to do something if they want to fire and fire him they either have to x always the case well i don't know that's always the case you're on a well i mean if i have an employee who i want to terminate i have to terminate yes but if it's a true out well then the employer doesn't have to do anything if there is a contract i don't see what you're saying really doesn't do anything has to far and if you want to trigger if you want to get into the application of for cause or they could fire him without cause and if they fired for cause they have to give him a hearing and if they fire him without cause they have to pay him the severance that's listed in paragraph five as as the court has noted in this case the employer is terminated without warning he has not given any reason for the reason any reason for why he's terminated and it's pled in the complaint that's what it means to be that will employee yes i understand that john but he's not given any severance and he's not given a due process and so we've terminated he's told by the lawyer for the district that you were terminated without c you're not entitled to a hearing and to be honest i agree you are not entitled to a hearing but my point is this at the point where he's term in it ok he doesn't know whether he's been fired for cause or not because he's been told by a lawyer that it's not for cause but he doesn't know that first or you miss what i said he was told that if the timing was far that it was told by the attorney that it was not for cause right so you would like not to call it but that could simply been lip service paid by the by the district in order to well the lawyer was this is the lawyer was the employer's agent told him use not play trickle and there's nothing in the record out from the board meeting whether he was fired for cause or not and i understand that you're on is saying ye done under the contract ok so that's what he would be entitled to and he wasn't given it was a farce for cause he was fired for he was and will employee was far without we're back to the same place because the lawyer told him compensation provided for in the employment contract and specifically it's kind of confusing to me but i just wonder ask maybe both sides of this how was this compensation paid to mr clooney was it in was it in cash this is my understanding your honor and i was going to that was going to be my next topic anyway so i appreciate the court asking that question the deferred compensation is is part of the salary package under paragraph seven of the contract the salary includes the the base salary plus deferred compensation and my understanding of what the deferred compensation is from the record is that it is money that was earned by mr clinton while he's being employed but is going to be paid later at some later time though that i get apparently it was for it's to benefit the budget of the district so they don't have to pay his entire salary all at once they can defer part of it to a later date i suppose the employee also gets a benefit out of that if it's paid later on in retirement for tax benefit purposes but i don't know that for sure in this particular but if you think there's no question that is part of his compensation no question that is part of his compensation and it was it looked to me is that it was something that was only come kitty dop to enhance is a retirement benefit was it something like that well i think it was more along the lines of the district budget and being able to pay it later on down the line much the same way that in sports these teams pay the big the quarterback or whatever they pay him some now and then they defer the compensation later  the district court in this case concluded that the deferred compensation provided for in includes contract was a non cash i but the contract as seems to suggest that this was a specific dollar amount i think it's pacifically seems to suggest a specific dollar amount that was included in part of cruise salary so i guess i'm just trying to figure out whether the district court erred here and so when you give you your best opportunity to tell me why do you think he did i think that the district court did err on or explain why and i did calculations ahead of time before i walked into court to make sure that i understood it in my head now under the paragraph five be it says that the district to make terminate the employee's employment at will provided that it gives the employee a severance of no less than twelve months compensation and the word compensation i think is very broad in and in there is to the benefit of the employee doesn't say twelve months of base salary it says twelve months of compensation and i don't think that it's a coincidence that in paragraph seven compensation is also referred to as deferred compensation i think that the compensation referred to in paragraph five and severance is both the base salary for the states and the four hundred for four hundred and forty thousand six hundred forty eight dollars which is the base salary plus for what for how many months for twelve months right and you're saying that to are i'm saying that the word compensation and paragraph five be includes deferred compensation but in addition to that you're saying that for the regular not deferred compensation that it's a little short than what it should have been isn't that what you're making no i'm not saying that it all on or l and i know it's hard it is hard for me to get my head around this but if we just look at twelve months of salary plus deferred compensation you end up at a total of four hundred and seventy seven thousand this is where it sliced starts getting slightly complicated because we say we're entitled to base salary in deferred compensation which is for seventy seven k the defendant said but wait you have to look at government code section five three two six zero and five three two six zero puts a cap on the total amount of severance that can be paid to the employer and that amount shall be and this is this is i'm reading from subsection shall be an amount equal to the month even if you agree with the defendants that his base salary is all that you look at under this particular statute is based alaric and the defendants stipulat was four hundred forty thousand six hundred forty eight dollars per year and when you divide that by twelve months you got up with a month with thirty six hundred twenty and sixty seven dollars and when you multiply that by thirteen lines which is the calf provided under the statute where you end up with is four hundred seventy seven thousand three hundred sixty six seven cents which is higher than what it's a good plan give us four which was simply one year of salary including deferred compensation under the cap by three hundred sixty eight dollars and sixty party and just be able to recover costs and in this case i understand that there were many causes of back involving mr clinton he did not prevail on all the causes of action but he did prevail on one on a pretty big one where he won but it's just number two this was money that he that mr kling would not have been paid i'm i'm pretty convinced he would not have been paid by the district absent this particular lawsuit when i look at the opposition to the partial summary judgment motion that mr clinton filed to collect on a breach of contract line the district opposed by saying that he had performed under the contract and he wasn't entitled to that money that was owed under paragraph five b so it seems to me that their position was we're not going to pay you no matter what so the fact that he prevailed on that claim to me and want to substantial amount of money regardless of whether he didn't prevail on the retaliation or some of the other clocks i think is important because he recovered a good son that he would not have been otherwise i live that's true but it's also true that you are alleged just a number of claims and spent you for now if i was a trial judge on a given probably given you more and judge gold may have given you even more but that's not the point when the point is you've got to convince us that this was a result that result you want and it makes you want to own this client and i think that even adam at a minimum if the court said listen you got here you want to parse a summary judgment and that's where your costs get cut up as you prevailed up to that point and you may not have prevailed later on at trial but you should at least get some of the litigation costs back that up to the point of filing that the parse the summary judgment and winning that particular issue the problem we have is you know we weren't there this i read the record spent a lot of time with this case and there are lots of motions in lots proceedings and a hard for case relief then i think that it should pretty much be the only very unusual case in which cost litigation costs are not awarded i think that if in this particular case they should be awarded so i have just a little bit of time with that like to just  but of course of the penalize questions about any of them i'm prepared to answer and in terms of due process as the questioning indicated clearly was employed at will both under the contract and that was required as a matter of statutory law in california that all we're trying to do as a trial strategy matter your honor and i can't say but if you were at the record what did you take away from the record what i took away from the record is that it was a hotly litigated case on many friends and all the parties what  defenses did you have to the sour you look like to me as though you were just trying to inflict pain on this round i didn't make it more uncomfortable or make it make it on you make it difficult for him to litigate yeah i don't see that in the record this early but what i do see again is that it was a hotly litigated claim where every party was raising any conceivable argument it could and the district court patiently worked through the case and that was an issue you know that we didn't prevail on the judge and i was your good faith basis for not paying in this the severance but the argument that we raise below was it was an argument that because he materially breached the contract by failing to perform in certain ways that he therefore wasn't entitled to the  an argument that you know the district court ruled against us aha can you make such an argument if your alternative argument or your powell argument is that he was discharge without cause yeah and it's that for that reason that it's not an argument that the district is making on appeal there's no cross appeal on this case so that's completely out of the case clunes recovery on the contract theory is not in jeopardy on appeal right now the only question is whether over and above the contract recovery that he received which the district isn't contesting on appeal that's that's he's got that the only issue is whether over and above that he's entitled to due process recovery well that if you're living gated against him marshalling in presenting evidence that he was fired for cause how do you simultaneously maintain that he was fart without coal so the argument below wasn't that he was fired for cause the argument was that he materially breached the contract which under california contract law discharges the non breaching party from performance but it minutely the district court found that to be a weak argument and it's an argument that the district has not pursue through across appeals and that's completely out of the case right now the issue on appeal is whether having prevailed under the breach of contract claim and that's undisputed he says he prevailed on that and that's the world we live in let's let me ask you to do this is soon argue window that we conclude that the deferred compensation was compensation what's the number associated with the number associated with it and i agree with opposing counsel is that thirty six thousand no not not at all your honor the remedy from this court would be quite modest it would just be in a firm and but with an instruction to amend the judgment to include that extra money but ok back to that like to argue why awarding that extra money is unwarranted unless the compensation was four hundred seventy six nine hundred ninety eight and this amount is within the cap and posed by five three to six which i think the cap is for seventy seven three six eight is that counsel in the court have indicated such a cap for severance payments but it does more than that it also sets forth a formula for calculating severance payments and that formula can't be abridged by contract and actually here as well as all show the contract regardless of the term of the contract if it's terminated the cash the actual impact settlement that employee may receive should be an amount equal to the monthly salary of the employee multiplied by the the term remaining so it uses the word salary then the fact that that's a formula not just the capital formula is emphasized in subdivision c of the statute which uses the word formulates as the cash settlement formula as described in subdivision a and then it goes on but it talks about maximum cash settlement formulas so if you look at the employment agreement that the woman had with the health care district when looking at section seven a it distinguishes very carefully between clune salary on the one hand and deferred compensation on the other hand so i agree with the court it from the question of my adversary that deferred compensation is compensation but that doesn't get him where he needs to be because the critical issue is whether it's salary and only salary can be part of the settlement formula in fifty three to sixty so that was the basis for the district court's ruling to washington so that the parties could call it what they wanted to but the parties in this case called it different they distinguish salary on the one hand which i think in the ordinary use of the word means the money that an employee regularly receives for performing his job duties and then they distinguish that the parties both sophisticated parties bargain for something different for defer compensation and i agree with my opposing counsel description of what the deferred compensation was but by a matter of ordinary usage and then also as a matter just of the contractual taxed salary as distinguished from deferred compensation only salary could be part of the compensate of the settlement formula under fifty three to sixty and therefore the district court properly excluded deferred compensation but again if the court disagrees about that the remedy is very modest it would just be a mending the judgment by the thirty six thousand dollar figure that opposing counsel is seeking finally regarding costs and then the cost and fees issues i mean as judge parker indicated they are different but they're similar in that bo the deferred compensation i know you're on it so section seven is caps and salary which which inject some lack of clarity but the clear but that becomes much clearer when you actually read down into the subdivision a right below it in the contract where the first sentence using a capital letter salary says the salary of employee for his services shall be four hundred twenty five thousand so that defines what salary is then if you look at the last sentence of that paragraph it says employees shall also receive so in addition to the defined salary term the employee shall also receive twenty five thousand dollars per year to be placed in a deferred compensation plan so that very carefully distinguishes salary on the one hand i'm signed up to receive five hundred thousand dollars a year and for tax reasons or already whatever reason i said look i want you to just pay me ten thousand dollars a month  for year or two years and then you know when i leave retire and leave california and go to arizona or florida pay me the r i mean that's salary he just doesn't get it the day he gets it when he's in miami beach but i disagree your honor both as a matter of common usage and also as a matter of just of contractual tax is a matter of common usage  i think i think salary means what it means in the world which is that an employee works and gets bi weekly or whatever else paychecks in lockstep with the work and consistent with that ordinary usage of the contract distinguishes the salary of the employee and provides a salary of the employees of the four hundred twenty five thousand and then separate and apart from that is the deferred compensation lets the penalize an additional questions on that issue  awarded drastically reduced amount of attorney's fees the most requested so discretion it wasn't your honor again this is an area where district courts enjoy broad discretion both because they've lived with the case  long and because they're familiar with litigation in their district this was a judge who gave this case farrow and careful attention at every step and as the panel's already noted and throughout that process the district court got a sense of what efforts clunes counsel reasonably expended on his one successful claim is his breach of contract claim which the district court explained was a pretty simple claim just getting severance to which he was intitled and what efforts were not directed at that claim so first of all the district court had discretion to determine under california law that the claims were not inextricably intertwined that that contract which the court found was a very simple and straightforward claim was separable from all the other claims in the case so that was an abuse of discretion and then the court had discretion to apply the lodestar method as it did applying a reasonable hourly rate and in this case it actually acts excepted the rates proffered by clunes counsel multiplied by a reasonable number of hours worked so the district court properly applied the governing legal framework and i did so in a way that was not a logical implausible or contradicted by the record so there is no abuse which it is less than queen's counsel asked for by a significant amount but the district court has discretion to do that indeed the award was so that the request for attorney fees was so pa and reasonable that under california law the district court would have been entitled to deny fees altogether but he didn't do that you warded fees to clean the council in a reduced amount to account for the fact that clinton prevailed and only one field you will climb  unless there's any other questions on the panel i can submit i'm prepared to address why the district court didn't abuse discretion in imposing reasonable time limits at the bench trial judge oh yeah i have no questions thank you ok i thank you thank you very briefly your honor as i'm on section fifty three to sixty the legislature of california decided they're going to put a cap on these type of settlements in the cap is exactly what the statute says it's supposed to be which says it shall be in amounts equal to the monthly salary of the employee multiplied by the number of months left on the unexpired the contract point is simply that even if you were to look just at the base salary of mr quinn at the time of terminations you would still have to multiply that number by thirteen which is the number of months remaining on his contract to get to the cap that calf when you multiply thirteen times the base salary on a monthly basis is exceeds but the year total of compensation plus deferred compensation that he was owed under the contract so our point is that the statute doesn't really take a factor because they haven't gone over the cap that they had gone over the calf then we'd have to reduce it down to where the  calculations earlier so i don't want to belabor that i think the court has said our reply brief does a pretty good job of explaining how that cap was not reached up and my time is up i appreciate if there's any other questions i'm happy to answer them thank you very much you thank you both both mr curly mr dexter for your argument presentations here today the case of peter cullen versus palo verde health care district is submitted will be adjourned for the day thank you very much