1

Filed 11/24/21 Samuels v. Hamrick & Evans CA1/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for 

publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or 

ordered published for purposes of rule 8.1115. 

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE

SETH SAMUELS et al.,

Plaintiffs and Respondents,

v.

HAMRICK & EVANS, LLP et al.,

Defendants and Appellants.

 A158688, A158878

 (City & County of San Francisco 

 Super. Ct. No. CGC-13-534626)

In 2013, Seth Samuels, his brothers, and their companies (plaintiffs)

filed this malpractice action against their former attorneys, Kenneth Greene, 

Raymond Hamrick, and the law firm of Hamrick & Evans (defendants). 

Plaintiffs sought damages for defendants’ negligent prosecution of an action 

to collect a $1.8 million judgment that plaintiffs had obtained against 

Pinewave Construction, Inc. in 2005. Like the parties, we refer to this 

judgment debtor as PW1 in order to distinguish it from its related company, 

Pinewave Commercial Construction, Inc. (PW2). 

Plaintiffs’ malpractice case was tried to the court in late 2018. In a 90-

page statement of decision, the trial court found that defendants committed 

malpractice and awarded plaintiffs damages totaling $4,502,807, plus 

interest. On appeal, defendants contend the judgment against them must be 

reversed because the judgment against PW1 was not collectible. 
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Alternatively, defendants contend the trial court erred by awarding 

prejudgment interest. We affirm the judgment but remand this case for 

recalculation of plaintiffs’ damages.

FACTUAL BACKGROUND

We base our background summary on the facts and evidence set forth 

in the statement of decision. 

I. Plaintiffs’ Judgment Against PW1

In 2002, plaintiffs and PW1 executed a contract pursuant to which PW1 

agreed to be the general contractor for plaintiffs’ construction project on 

Noriega Street in San Francisco. PW1 is owned by Eric Au, Edwin Law, 

Gavin Lam, and Lawrence Lee (the PW Owners). 

In December 2003, when the Noriega project was near completion, 

plaintiffs notified PW1 about significant construction defects. PW1 “tried 

unsuccessfully” to correct the defects. When plaintiffs refused to make 

further payments for the attempted corrections, PW1 stopped work on the 

project and the PW Owners “immediately” took the following actions: 

(1) they caused PW1 to pay them a shared dividend in the amount of 

$200,000 by drawing on a line of credit; (2) they set up PW2 and began 

transferring assets and projects to PW2; (3) they caused PW1 to “pay all of 

PW2s overhead, salaries, rents and expenses.” 

In May 2004, PW1 filed a demand for arbitration of its dispute with 

plaintiffs. That same month, it entered into a construction contract with a 

related company, Grove Avenue Business Park LLC (Grove). PW Owner Lee 

signed the contract on behalf of PW1 and PW Owner Law signed for Grove. 

The Grove project was completed and sold in June 2005. “The PW1 owners 

manipulated the Grove Project so as to allow Grove to keep between $1.3 and 
3

$1.9 million in value” by causing PW1 to undercharge Grove for PW1’s 

services. 

In September 2005, plaintiffs obtained an arbitration award, which was 

confirmed as a $1,799,830 judgment against PW1 in October 2005. At the 

suggestion of their arbitration counsel, plaintiffs retained the law firm of 

Rutan and Tucker (Rutan) to pursue collection efforts. 

II. Collection Efforts During 2006–2007

Rutan garnered substantial discovery about PW1 and PW2 despite 

“fierce[] resist[ance]” from the PW Owners. Information collected by Rutan

included research into a PW1 website that hosted PW-related entities, which 

“revealed projects that had been started by PW1 but which had been taken 

over by PW2.” Rutan also conducted an Order of Examination (OEX) for two 

PW Owners, Edwin Law and Gavin Lam. Lam’s August 2006 OEX contained 

testimony establishing that “the reason PW2 was formed and the assets and 

business of PW1 were transferred to it was to avoid the legal claims against 

PW1.” Seventy-six boxes of records were produced during Lam’s OEX, which 

included tax returns and financial statements. 

At Law’s July 2006 OEX, PW1 resisted a discovery request for 

computer records, claiming that its computer systems were all sold to PW2, a 

nonparty to the arbitration action. To justify this position, PW1 produced a 

bill of sale dated August 3, 2005, two weeks before plaintiffs obtained their 

arbitration award. Rutan’s computer expert determined that the bill of sale 

was created in October 2005. 

In December 2006, Rutan filed a collection action on behalf of plaintiffs, 

asserting alter ego and direct tort liability theories against PW2 and the PW 

Owners. Then Rutan obtained a writ of attachment that “tied up” $500,000 

of PW2 assets, and a court order requiring PW2 to produce missing 
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accounting documents, electronically stored information and computer 

records. In response, the PW Owners promptly filed for Chapter 11

bankruptcy on behalf of PW2, securing a stay of state court discovery. As 

debtors in possession of PW2, the PW Owners enriched themselves through 

transfers of PW2 assets. In November 2007, PW2’s bankruptcy was 

converted to a Chapter 7 proceeding. 

III. Defendants’ Representation of Plaintiffs

In October 2007, plaintiffs retained Ken Greene to replace Rutan as 

counsel in their collection action. Prior to his retention, Greene had been 

advising Seth Samuels for several months, and he convinced Samuels that 

Rutan “had made mistakes and overcharged him.” Greene’s attorney fee 

agreement provided that he would be paid $200 per hour to continue 

prosecution of the collection action, participate in the PW2 bankruptcy action, 

and take any other action agreed upon by the parties. The agreement did not 

contain a provision relieving Greene of his obligation to provide attorney 

services in the event plaintiffs’ resources were depleted or they failed to pay 

their bills. In around November 2007, Greene became a partner at Hamrick 

& Evans, bringing plaintiffs’ cases with him.1

In January 2008, the PW Owners filed motions for summary judgment 

or summary adjudication in plaintiffs’ collection action. Greene obtained

multiple continuances, which delayed the hearing on these motions until 

December and the July 2008 trial date until summer 2009.

During 2008, Greene did not take any discovery relating to the pending 

summary judgment motions; he did not take depositions despite plaintiffs’ 

1 Defendants represented plaintiffs in two other actions arising out of 

the Noriega Street project, one against Everest Insurance Company and the 

other against companies responsible for defective windows. Disputes about 

defendants’ representation in those cases are not before us on appeal. 
5

requests that he do so; and, although he attempted to subpoena business 

records from PW-related entities, all of his subpoenas were quashed due to 

procedural errors. When Greene obtained a final continuance of the trial 

date, he failed to request that discovery remain open, causing additional 

subpoenas to be quashed as well. As a consequence of Greene’s failure to 

subpoena relevant records, his chosen expert, Colin Johns, declined to testify. 

Greene failed to properly secure, prepare or disclose an expert witness 

to offer opinions opposing the summary judgment motions. He told plaintiffs 

he thought Colin Johns would “make a poor showing” and did not want to use 

him, and he also rejected Everett Harry, another expert who Seth Samuels 

had found. In October 2008, Samuels contacted Claudia Berglund who is a 

forensic accountant. Greene retained Berglund and had plaintiffs pay her 

$10,000. Berglund made preliminary conclusions supportive of plaintiffs’ 

alter ego and fraudulent transfer claims, but when Greene attempted to 

amend his expert witness disclosure two days before the second session of the 

summary judgment hearing, the PW Owners objected, and Greene stopped 

working with Berglund. Ultimately, Greene filed a declaration by Seth 

Samuels, but he failed to advise the court about Samuels’s “extensive 

training in accounting, and significant experience with computerized 

accounting systems.” Samuels’s declaration was deemed inadmissible on the 

ground that Samuels was not qualified as an expert. 

In opposing the summary judgment motions, Greene did not utilize 

evidence that had been garnered by plaintiffs before they retained Greene. 

That evidence would have established the PW Owners’ control of PW-related 

entities and that they made fraudulent transfers. Plaintiffs also had 

persuasive evidence showing that the PW Owners “took unabashed and 

repeated steps to conceal and then destroy . . . evidence from their PW 
6

Computer Server Network.” Although it took plaintiffs years fully to unravel 

the PW Owners’ trail of wrongdoing, sufficient evidence to have defeated the 

motion for summary adjudication was readily available to Greene when he 

took over the case. 

In January 2009 the PW Owners were granted summary adjudication 

as to most of plaintiffs’ causes of action, including the alter ego claims. In 

February, Greene took the depositions of three PW Owners. Subsequently, 

he filed a motion for reconsideration of the summary adjudication order, 

relying on the 2009 depositions, business records from PW1, and the 

declaration of a computer expert. That motion was denied as untimely. 

Despite the unfavorable summary adjudication rulings, evidence 

available to Greene could have been used to prove fraudulent transfer claims 

that had not been summarily adjudicated. Instead of pursuing that course, 

Greene began advising plaintiffs to dismiss their case. About six weeks 

before the rescheduled trial date, Greene threatened to withdraw from the 

case, claiming his future bills could be as high as $150,000. 

In July and August 2009, Greene represented plaintiffs in proceedings

on their motion to establish that PW1 and the PW Owners committed 

spoilation of evidence. Plaintiffs relied on evidence that when PW2 finally 

complied with court orders compelling production of the computers that PW1 

allegedly sold to PW2, the hard drives had all been “wiped.” The trial court 

found that “massive destruction of documents” had occurred, but plaintiffs 

failed to prove their spoliation claim because they did not establish that the 

destroyed documents contained discoverable information that plaintiffs had 

not previously received in another format. 

On August 10, 2009, plaintiffs’ collection action was dismissed without 

prejudice. 
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In June 2012, defendants represented plaintiffs at a hearing regarding 

plaintiffs’ proof of claim in the PW2 bankruptcy case. Plaintiffs sought to 

recover the PW1 judgment pursuant to theories of successor liability, alter 

ego, and fraudulent transfer of assets. The bankruptcy court overruled 

objections to plaintiffs’ claim, finding that PW2 is the alter ego and successor 

to PW1. Plaintiffs’ allowed claims against PW2 totaled $2,189,890. However, 

the amount paid for these unsecured claims was only $222,771.

IV. Findings and Judgment in the Malpractice Action

In October 2013, plaintiffs filed this malpractice action. A court trial 

was held over fourteen nonconsecutive days between September and 

November 2018, after which the court elicited post-trial submissions. A May 

2019 final proposed statement of decision was adopted as the court’s final 

statement of decision on June 5, 2019.

The first set of legal issues decided by the trial court pertained to 

whether defendants breached their duty of care to plaintiffs. The court found 

that resolution of this issue turned on the expert testimony. (Citing CACI 

600.) Plaintiffs’ expert, an attorney named William Norman, testified that 

Greene’s conduct fell far below the standard of care in several ways, 

including: failing to take adequate steps to oppose the summary adjudication 

motions; failing to take the remaining fraudulent transfer claims to trial; and 

forcing plaintiffs to dismiss their collection action by threatening to withdraw 

as their counsel. 

Defendants did not elicit opinions from their designated experts as to 

whether Greene breached the standard of care, relying instead solely on 

Greene’s testimony. Greene claimed that the reason he did not do more work 

in the collection action was because plaintiffs lacked adequate financial 

resources to pay for it. The court rejected this testimony on two independent 
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grounds. First, the trial evidence established that “money was not the issue.” 

Throughout 2008, plaintiffs paid all bills relating to the collection action; they 

paid Greene’s fees, Berglund’s expert fee at Greene’s direction, and they also 

paid for discovery that Greene finally conducted in 2009. Second, and in any 

event, Greene’s alleged concern about money was no excuse for committing 

“an extremely serious breach of the standard of care.” Ultimately, the court 

found that Norman’s “credible and believable” expert testimony established 

that defendants’ conduct fell substantially below the standard of care and, to 

the extent Greene’s testimony could be construed as contradicting any of 

Norman’s opinions, it was “not credible or believable.” 

The other set of issues decided by the court pertains to whether 

defendants’ breach of duty caused plaintiffs’ damages. Plaintiffs employed 

the “trial-within-a-trial” method to show that they would have prevailed on 

their alter ego claims against the PW Owners if not for Greene’s malpractice. 

This theory required that plaintiffs establish “ ‘collectibility,’ ” i.e., that they 

were deprived of the opportunity to collect a money judgment from a solvent 

debtor. (Wise v. DLA Piper LLP (2013) 220 Cal.App.4th 1180, 1190 (Wise).)

The parties presented conflicting expert testimony as to whether 

plaintiffs would have prevailed on their alter ego claims against the PW 

Owners. William Norman testified that plaintiffs would have prevailed on 

these claims because they had strong evidence to establish both unity of 

interests and inequitable conduct. Defendants’ expert, Heather Xitco, is a 

forensic accountant who opined that the available financial records would not 

have supported a conclusion that the PW Owners had an alter ego 

relationship with PW1. 

The trial court concluded that Norman’s opinions on these matters 

were credible and reasonable and rejected Xitco’s opinions as neither credible 
9

nor believable. Findings in support of these rulings included that Norman’s 

qualifications are superior to Xitco’s qualifications: Norman is an attorney 

with more than 40 years of experience litigating complex commercial cases, of 

which 75 involved alter-ego issues; Xitco is an accountant who focused 

exclusively on financial matters. Further, Norman’s opinions are supported 

by a comprehensive analysis of the relevant chronological facts, while Xitco 

based her opinion on the sole fact that complete financial records were not 

available, ignoring other pertinent facts and events that occurred before and 

after plaintiffs obtained the 2005 judgment. 

The court also independently reviewed the evidence admitted as part of 

the trial within a trial and concluded that plaintiffs should have prevailed on 

their alter ego claims. In reaching this conclusion, the court made an express 

finding that “[t]here was a unity of interest between and ownership between 

[the PW Owners] and the corporation PW1 which enabled them to take PW1 

assets and transfer them either to themselves or other entities as to which 

they were owners which resulted in a serious inequity of PW1 being unable to 

pay a judgment for 1.8 million.” The court also found that if not for Greene’s 

malpractice, a judgment in the underlying case should have been obtained in 

mid-2008. 

Next, the court found that plaintiffs carried their burden of proving 

that the judgment they should have obtained in mid-2008 would have been 

collectible. Mr. Norman, the only expert who testified as to this issue, offered 

the opinion that a judgment against the PW Owners would have been 

collectible. The court found that Norman was “extremely well qualified to 

express an opinion on collectability” and that his “factual testimony” about 

this matter was “extremely strong and credible because of his background, 

experience and knowledge of specific facts in this case.” For example, he 
10

testified about the PW Owners’ interests in other PW-related projects, 

including a 50,000-square foot office condominium building in Santa Clara 

known as the Pearl Gateway Project, valued at over $15 million, and another 

project referred to as the “Jiagmen China project,” which had been built 

without a construction loan and was worth between $10 and $15 million. 

Norman also based his opinion on the work-product of Berglund, plaintiffs’ 

expert in the collection action, which showed that PW1 had a substantial 

interest in the Grove project because it had improperly transferred $1.9 

million to that project. 

The court also “performed its own analysis” and found “as a fact” that 

the $1.8 million judgment was collectible. The court supported this finding 

with three additional categories of evidence. First, financial statements

produced at trial showed that two of the PW Owners, Au and Lee, 

“collectively had a net worth of $4,621,559 and collectively [had] cash and 

stocks and bonds and real property excluding their homes, of $2,260,959.” 

The court found that Greene could have taken steps to ensure that the 

October 2005 judgment was collectible from the PW Owners by attaching 

these funds in 2007, after he took over the case. 

Second, the PW owners’ conduct during the PW2 bankruptcy 

proceedings was additional evidence of their solvency. In 2009, the 

bankruptcy trustee filed a motion for sanctions against the PW Owners for, 

among other things, intentionally destroying PW1 business records in order 

to cover up transfers of assets from PW1 to PW2, and for causing improper 

pre-petition and post-petition payments from the PW2 bankruptcy estate. In 

2010, the PW Owners elected not to defend the trustee’s “well-prepared 

motion,” and paid $660,000 to settle the trustee’s claims against them. The 

fact that these individuals had resources to pay the settlement was 
11

“persuasive evidence” that they could have paid a judgment in plaintiffs’ 

collection action if defendants had met their standard of care and brought the 

case to trial on the original trial date in mid-2008. Moreover, the court found, 

if the alter ego claims had been proven in plaintiffs’ case, bankruptcy estate 

assets would not have been depleted litigating these same issues, and there 

would have been more funds available to pay plaintiffs as creditors of PW2. 

In this regard, the court observed that $500,000 of the sanctions settlement 

was paid to the trustee and his attorney for their work on the motion. 

Third, the court found, evidence that the PW1 owners deliberately 

destroyed documents and records in order to conceal their transfers of assets 

from PW1 to PW2 supported a finding that the PW Owners “at all times had 

effective ownership of assets of sufficient value that the judgment in the casewithin-the-case would have been collectable.” 

V. Calculation of Damages and Entry of Judgment

The court found that because defendants’ malpractice was the cause of 

plaintiffs’ failure to collect the October 2005 judgment in 2008, plaintiffs’

damages are equal to the amount of that judgment plus interest at the legal 

rate. In calculating the unpaid balance of the 2005 judgment, the court gave

defendants credit for two partial payments: $28,284, which had been 

“collected directly” from the PW Owners/entities; and $222,867, which 

plaintiffs received from the PW2 bankruptcy trustee. The court also adjusted 

its calculation of accrued interest on the 2005 judgment to reflect the fact 

that the judgment was renewed in February 2015. Applying these criteria, 

the court determined that, as of February 20, 2019, damages caused by 

defendants’ negligent failure to collect the 2005 judgment totaled $4,502,807. 

Judgment was entered on June 5, 2019. The court ordered that 

judgment be rendered in favor of plaintiffs and against defendants in the 
12

amount of $4,502,807 plus interest, for a total amount of $4,596,857 as of the 

date of entry of judgment. 

DISCUSSION

I. The Collectibility Findings Were Not Error

Defendants contend the judgment against them must be reversed 

because there is insufficient evidence that they caused plaintiffs damage. 

Defendants concede that plaintiffs would have obtained a judgment in 2008 

in their collection action against the PW Owners (i.e., a hypothetical 2008 

judgment) if not for defendants’ malpractice. But they contend there is no 

substantial evidence such a judgment was collectible. (See Garretson v. 

Harold I. Miller (2002) 99 Cal.App.4th 563, 569 (Garretson) [trier of fact’s 

collectibility findings are reviewed for substantial evidence]; Wise, supra, 220 

Cal.App.4th at p. 1191 [same].)

A. Legal Principles

“ ‘In civil malpractice cases, the elements of a cause of action for 

professional negligence are: “(1) the duty of the attorney to use such skill, 

prudence and diligence as members of the profession commonly possess; (2) a 

breach of that duty; (3) a proximate causal connection between the breach 

and the resulting injury; and (4) actual loss or damage.” ’ ” (Blanks v. 

Seyfarth Shaw LLP (2009) 171 Cal.App.4th 336, 356–357 (Blanks).)

The causation and damages elements of malpractice require the 

plaintiff to establish that “but for the defendant’s negligent acts or omissions, 

‘the plaintiff would have obtained a more favorable judgment or settlement in 

the action in which the malpractice allegedly occurred.’ ” (Blanks, supra, 171 

Cal.App.4th at p. 357.) To satisfy these requirements in the present case, 

plaintiffs employed the trial-within-a-trial method, which requires the 

current trier of fact to “ ‘ “determine what a reasonable judge or fact finder 
13

would have done. . . .” [Citation.] Even though “should” and “would” are 

used interchangeably by the courts, the standard remains an objective one. 

The trier of fact determines what should have been, not what the result 

would have been, or could have been, or might have been, had the matter 

been before a particular judge or jury.’ ” (Ibid., italics omitted.)

As part of its trial-within-a-trial case, the plaintiff must “prove that 

careful management” of the underlying case “would have resulted in a 

favorable judgment and collection thereof, as there is no damage in the 

absence of these latter elements.” (DiPalma v. Seldman (1994) 27 

Cal.App.4th 1499, 1506–1507.) “In this sense, collectibility of the 

hypothetical underlying judgment . . . is a component of the plaintiff’s current 

case relating to damages, as caused by the current negligent attorney 

defendant.” (Wise, supra, 220 Cal.App.4th at p. 1191.)

Proving collectibility invariably requires “ ‘a showing of the debtor’s 

solvency.’ ” (Wise, supra, 220 Cal.App.4th at p. 1190.) “ ‘The loss of a 

collectible judgment “by definition means the lost opportunity to collect a 

money judgment from a solvent [defendant] and is certainly legally sufficient 

evidence of actual damage.” ’ ” (Ibid.) The inquiry is not just a question of 

technical solvency, as it focuses more broadly on evidence of the defendant’s 

“ability to pay a judgment or some part of it.” (Hecht, Solberg, Robinson,

Goldberg & Bagley LLP v. Superior Court (2006) 137 Cal.App.4th 579, 591 

(Hecht).)

Collectibility is a fact-intensive inquiry, which “ ‘ “looks to the actual 

circumstances to determine whether the judgment ‘would have been 

collectable.’ ” [Citation.] It is not enough for a plaintiff to present 

speculation or assumptions about an underlying defendant’s ability to 

respond in damages, as opposed to proof of same.’ ” (Wise, supra, 220 
14

Cal.App.4th at p. 1191.) On the other hand, absolute certainty is not 

required. (Ibid.) “Admissible evidence on collectibility can include 

information about the basic solvency of the defendant in the underlying case, 

as shown by its assets, net worth or available proceeds from investments.” 

(Hecht, supra, 137 Cal.App.4th at p. 591.)

B. Analysis

In concluding that a hypothetical 2008 judgment against the PW 

Owners would have been collectible, the trial court referenced four categories 

of evidence: Norman’s expert opinion; personal financial statements of two of 

the PW Owners; the PW Owners’ conduct in the bankruptcy case; and 

evidence that the PW Owners deliberately concealed their assets from 

plaintiffs and the courts. Defendants contend that each category of evidence 

is either inadmissible or insufficient to establish collectibility. We address 

defendants’ arguments with the caveat that the issue on appeal is whether 

all the evidence considered together substantially supports the judgment.

1. Expert Evidence

During Norman’s direct testimony, plaintiffs’ counsel asked for 

Norman’s expert opinion as to whether the PW Owners “actually had assets 

that could have been collected” if not for defendants’ breach of their standard 

of care. Norman responded that a $2 million judgment divided among the 

four individuals “was clearly collectible at the time.” Norman also opined 

that, although a judgment would not have been collectible from PW1 in 2008, 

that entity would also have had sufficient money to pay plaintiffs’ judgment if 

it had been “honestly run,” and the PW Owners had not transferred the 

company assets. 

Defendants attempt in various ways to discredit Norman’s opinions. 

For example, they contend erroneously that Norman did not “even opine on 
15

collectibility,” ignoring the testimony summarized here. They also argue that 

the court did not qualify Norman to offer an opinion on the issue of

collectibility. Again, the record shows otherwise. During voir dire, Norman 

testified that his 40 years’ experience practicing law includes handling 

malpractice cases as well as alter ego and fraudulent transfer cases and he 

has been qualified as an expert on the subject of attorney conduct “on a 

number of occasions.” After defendants declined to voir dire, the court found 

that Norman was qualified without limiting its finding to a specific issue. 

More importantly, the court soon followed this by asking whether Norman’s 

testimony as an expert on “malpractice” would include the following opinions:

(1) defendants violated the standard of care in presenting the underlying 

case; (2) if defendants had acted within the standard of care, the underlying 

case would have been proved; and (3) plaintiffs would have collected money if 

not for the defendants’ breach of duty. Norman confirmed he would offer 

these opinions without drawing any objection from the defendants. “[T]he 

qualification of a witness to state his or her opinion is waived by failure to 

object to the testimony when offered.” (569 E. County Boulevard LLC v. 

Backcountry Against the Dump, Inc. (2016) 6 Cal.App.5th 426, 437, fn. 12.) 

Defendants’ substantive objection to Norman’s opinion is that he 

allegedly relied on speculative factors and assumptions not supported by the 

record. The testimony of a single witness, including an expert witness, may 

constitute substantial evidence, but “when an expert bases his or her 

conclusion on factors that are ‘speculative, remote or conjectural,’ or on 

‘assumptions . . . not supported by the record,’ the expert’s opinion ‘cannot 

rise to the dignity of substantial evidence’ and a judgment based solely on 

that opinion ‘must be reversed for lack of substantial evidence.’ ” (Wise,

supra, 220 Cal.App.4th at pp. 1191–1192.) 
16

Wise provides a useful example of an expert opinion unsupported by the 

evidence. (Wise, supra, 220 Cal.App.4th 1180.) The plaintiffs obtained a 

malpractice judgment against their former attorneys who helped them secure 

a money judgment against Mr. Cheng for defaulting on a loan but then failed 

to advise them of the necessity to renew the judgment. (Id. at p. 1183.) The 

malpractice judgment was reversed on appeal, however, because there was 

“no evidence” the Cheng judgment would have been collectible even if it had 

been renewed. (Ibid.)

The Wise plaintiffs’ trial expert, a collections attorney, testified that the 

Cheng judgment was collectible in the past and would be collectible in the 

future. (Wise, supra, 220 Cal.App.4th at p. 1192.) This testimony did not 

constitute substantial evidence of collectibility because it was premised on 

“an incorrect legal theory” that plaintiffs could have employed “reverse 

piercing” to reach funds that third party investors had paid to corporate 

entities operated by Cheng. (Id. at p. 1193.) Although the expert gave 

additional reasons for his collectibility opinions, none carried evidentiary 

weight. (Id. at p. 1194.) For example, the expert speculated that Cheng 

owned part of his home but the trial evidence showed that he did not. The 

expert also suspected that Cheng had money hidden in foreign bank accounts 

and assumed that he “had significant financial resources” because he had 

taken multiple trips to China, but there was no evidence to support these 

assumptions. Because the expert’s collectibility opinion “relied purely on 

speculation or assumptions unsupported by the record,” a judgment based 

solely on that opinion was reversed for lack of substantial evidence. (Ibid.)

In contrast to Wise, Norman’s expert opinions do not depend on any 

invalid legal theory; there is no dispute on appeal that the PW Owners are 

alter egos of the PW-related entities and that they fraudulently transferred 
17

assets out of PW1 in order to avoid having to pay the 2005 judgment. Nor do 

defendants establish that Norman’s opinions are predicated on speculation or 

unproven assumptions. Norman demonstrated to the trier of fact that he has

extensive knowledge of the historical facts and provided concrete examples 

supportive of his conclusion that the 2005 judgment was collectible from the 

PW Owners in 2008. In this regard, Norman testified that the 2009 

depositions of the PW Owners, which could have been taken in 2008 if 

Greene had been diligent, showed that the “individuals owned substantial 

shares in a number of real estate projects” including the Jiagmen China 

project and the Pearl Gateway project. Norman also based his opinion on the 

trial-within-a-trial testimony of Berglund and Harry, which established that 

the PW Owners transferred somewhere between $1.5 and $1.9 million from 

PW1 to other PW-related entities “owned by the four men.” 

Defendants contend that Norman’s opinion is speculative because there 

is no evidence in the trial record that the PW Owners’ interests in either 

Jiagmen China or Pearl Gateway had sufficient value to enable them to pay a 

$1.8 million judgment in 2008. First, we reject the suggestion that Norman 

was required to proffer documentation of facts relied on to support his 

opinion, particularly when defendants did not challenge that opinion at trial. 

Second, Norman did not opine that a judgment would have been collectible 

directly from these two sources but used the projects as examples of interests 

that the PW Owners held in other PW-related entities and projects. The trial 

record contains undisputed evidence of the PW Owners’ personal ownership 

interests in multiple PW-related companies and in the real estate assets of 

those companies. This evidence provides record support for Norman’s expert 

opinion that the PW Owners were not only solvent but had the ability to pay 

a $1.8 million judgment. 
18

Insisting that Norman’s opinion is not supported by the trial evidence, 

defendants contend that “[s]imply showing that a defendant had many 

assets, or a high income, is not sufficient evidence of collectibility.” For this 

proposition, defendants cite Garretson, supra, 99 Cal.App.4th 563. In that 

case, the plaintiff was injured when she turned on an air compressor at the 

dental office where she worked and experienced a shock. Her first attorney 

pursued a workers’ compensation claim but never advised her she had a 

potential personal injury claim against third parties responsible for the 

incident. (Id. at pp. 565–566.) After plaintiff hired a new attorney, she sued 

her former lawyer for malpractice. 

At the Garretson plaintiff’s trial within a trial, her theory was that her 

injury was caused by a defective switch installed by an electric company, 

under the supervision of a contractor and of Dr. Ask, who owned the dental 

practice where the incident occurred. (Garretson, supra, 99 Cal.App.4th at 

p. 567.) Plaintiff used evidence supportive of this theory to argue that the 

defendant committed malpractice by failing to recognize and preserve her 

personal injury claim against these third parties. The jury agreed, but the 

trial court granted the defendant judgment notwithstanding the verdict 

(JNOV). Affirming the judgment on appeal, the Garretson court held that 

“the issue of collectibility was not tried. No evidence was presented by 

plaintiff to establish collectibility of any judgment that might have been 

obtained but for defendant’s negligence, and no argument was made to the 

jury on the subject. This failure of proof on the part of plaintiff warranted 

entry of [JNOV].” (Id. at p. 573.) 

The Garretson court rejected the plaintiff’s appellate argument that the

JNOV was not warranted because the jury at her trial within a trial could 

have concluded that a personal injury judgment against Dr. Ask was 
19

collectible even though the issue was not expressly addressed. (Garreston,

supra, 99 Cal.App.4th at p. 572.) Plaintiff theorized that evidence Dr. Ask 

had a successful dental practice would support a finding that he was “ ‘a 

significant income earner,’ ” and the fact that he owned his office building

was additional evidence of collectibility. (Ibid.) The court rejected these 

arguments because the plaintiff produced no evidence of the doctor’s income, 

expenses, debts or insurance assets, and it was not possible to determine 

from the record whether the doctor “had any positive net income, net worth, 

or other means of satisfying the judgment.” (Ibid.) 

In the present case, defendants maintain that this case presents 

“precisely the situation” as Garretson. Not true. Since the Garretson plaintiff 

did not offer any evidence to establish collectibility, that case obviously does 

not address what evidence an expert may consider in forming an opinion 

about the matter. Nor does Garretson support defendants’ notion that 

evidence a debtor has “many assets, or a high income” can never be sufficient 

to support a finding by the trier of fact that a judgment would have been 

collectible. The core problem in Garretson is that the collectibility issue was 

never litigated. By contrast here, plaintiffs offered evidence including expert 

evidence to prove collectibility and, although defendants elected to ignore the 

issue, the trial court made an express finding that a hypothetical judgment 

against the PW Owners would have been collectible. Nothing in Garretson

precludes us from concluding that Norman’s expert opinion constitutes 

substantial evidence supporting the collectibility finding.

2. Personal Financial Statements

As noted, the trial court did not just rely on Norman’s expert opinion 

but conducted an independent review that disclosed additional evidence of 

collectibility. For example, the court found two of the four individual PW 
20

Owners had sufficient net worth and attachable assets to pay between them 

the $1.8 judgment. This finding is supported by the June 30, 2006 personal 

financial statements of Eric Au and Lawrence Lee. As of that date, Au 

reported a net worth of $3,415,400, Lee reported a net worth of $1,807,159, 

and both individuals reported having no current liabilities. These statements 

also show the PW Owners owned attachable assets (i.e., not their homes) that 

had a collective value of more than $2,200,000. 

Defendants contend the personal financial statements are not 

substantial evidence of collectibility for three distinct reasons. First, 

defendants posit that this evidence is inadmissible hearsay. The record 

shows that the financial statements were identified and subsequently offered 

into evidence during Seth Samuels’s trial testimony. Samuels testified that 

this evidence was produced during discovery in the plaintiffs’ collection action

against the PW Owners. It was found in a locked QuickBooks file after

plaintiffs obtained the password from the PW2 bankruptcy trustee in April 

2008. After Samuels described printing copies of these statements, the trial 

court overruled defendants’ hearsay objection and admitted them into 

evidence. 

On appeal, defendants renew their hearsay objection, contending 

erroneously that neither the plaintiffs nor the court “identified any hearsay 

exception.” The statement of decision contains an entire subsection 

addressing this issue. There the court explains that evidence offered as part 

of the trial within a trial must be analyzed differently than evidence offered 

to establish a breach of the standard of care because in the trial within a 

trial, the PW Owners are considered the defendants. Therefore, the court 

found, statements by PW Owners are admissible pursuant to the party 

admission exception to the hearsay rule. (Citing Kessler v. Gray (1978) 77 
21

Cal.App.3d 284, 290–291; Mattson v. Schultz (7th Cir. 1998) 145 F.3d 937, 

940; see also Evid. Code, § 1220.) Failing to acknowledge this express ruling 

by the trial court, defendants forfeit any claim it was error. 

Defendants’ second contention is that the PW Owners’ personal 

financial statements cannot be substantial evidence of collectibility because 

there was a two-year “ ‘gap’ ” period between these statements and the time 

when plaintiffs should have collected their judgment, and plaintiffs failed to 

prove that the financial condition of these individuals did not change during 

that period. As authority for imposing this burden on plaintiffs, defendants 

cite Akin, Gump, Strauss, Hauer & Feld v. NDR (Tex. 2009) 299 S.W.3d 106 

(Akin). (See also Webb v. Stockford (Tex.App. 2011) 331 S.W.3d 169, 178 

(Webb) [applying Akin].)

Akin was a malpractice action against the Akin Gump law firm for 

failing competently to represent the plaintiff in litigation arising out of 

plaintiff’s contract dispute with Panda Energy International Corporation and 

several of its subsidiaries (Panda), which resulted in a series of judgments in 

favor of the Panda entities. (Akin, supra, 299 S.W.3d at pp. 106, 109.) In the 

malpractice case, a jury found in favor of plaintiff, awarding damages that 

included attorney fees plaintiff had paid in the Panda litigation as well as a 

hypothetical judgment that plaintiff should have recovered from Panda 

International and/or its subsidiary Panda Global. (Id. at p. 106.) The Texas 

Supreme Court found that attorney fees were recoverable as damages but 

there was insufficient evidence that a judgment against Panda would have 

been collectible. (Ibid.)

The collectibility issue addressed in Akin was limited to the question 

whether a judgment would have been collectible against the parent 

corporation Panda International because there was no dispute on appeal that 
22

subsidiary Panda Global was insolvent and no judgment could be collected 

from it. (Akin, supra, 299 S.W.3d at p. 111.) The Akin court concluded the 

trial evidence did not establish that Panda International could have accessed 

sufficient funds to pay a judgment at the time the underlying case was 

decided. (Id. at pp. 111 & 115.) In reaching this conclusion, the court 

articulated the principle that when a plaintiff relies on evidence of 

collectibility on a date prior to the final judgment in the underlying case, the 

evidence must also show “a reasonable probability that the . . . defendant’s 

financial condition did not change during the time before a judgment was 

signed in a manner that would have adversely affected collectibility.” (Id. at 

p. 114.) Without evidence covering this “gap time period,” the court 

explained, the factfinder would have to speculate about how intervening 

events affected the judgment debtor’s finances. (Ibid.)

Here, defendants argue that Akin compels the conclusion that the trial 

court’s collectibility finding is speculative because the PW Owners’ 2006 

personal financial statements predate by two years the judgment that

plaintiffs should have obtained against them, and there is no evidence that 

the financial condition of these individuals did not deteriorate during the 

two-year gap period. Defendants cite no California authority approving or 

applying the gap period requirement discussed in Akin, and we need not 

decide whether such a requirement might sometimes be appropriate in light 

of the material distinctions between Akin and this case. Dispositive for the 

Texas court was that the Akin plaintiff relied primarily on evidence that 

nonparty Panda entities had assets to pay the judgment but failed to 

establish that those resources were accessible by Panda International. Here 

there is no dispute that the PW Owners are the alter egos of PW1 and PW2 

and that they fraudulently transferred assets between these and other PW-
23

related entities in order to avoid paying plaintiffs damages arising from the 

defective construction of the Noriega project. Further, in contrast to Akin, 

the plaintiffs in this case proffered expert evidence of collectibility, which by 

itself substantially supports the trial court’s finding. And in Akin, there was 

evidence of the “financial deterioration of the Panda entities and projects”

during the gap time (Akin, supra, 299 S.W.3d at p. 117), evidence that finds 

no parallel in the record in this case. In light of these differences, we do not 

find Akin persuasive authority here.

Defendants’ final complaint about the PW Owners’ personal financial 

statements is that the trial court erred by speculating that Greene could have 

successfully attached the personal assets of the PW Owners in 2007. The 

trial court did not speculate about this matter, but made express findings

that Greene could and should have moved to attach personal assets of the PW 

Owners no later than November 2007. The court based these findings on 

evidence that the reason plaintiffs were denied a writ of attachment against 

the PW Owners in December 2006 was because at that time they did not have 

the evidence to establish the PW Owners were individually culpable for the 

2005 judgment, but by the time Greene took over the case in October 2007, 

plaintiffs had collected additional evidence that could have been used to 

obtain a writ of attachment against the property of the PW Owners. Personal 

financial statements were part of that evidence, although the court gave 

many other examples, including an expert declaration outlining the PW 

Owners’ falsification of evidence, QuickBooks files of PW1 and PW2, and 

other documentary proof of fraudulent transfers instigated by the PW 

Owners. Defendants offer no response to these findings.
24

3. Bankruptcy-Related Payments

The trial court found that a 2009 sanctions motion that the PW2 

bankruptcy trustee filed against the PW Owners is probative evidence of 

collectibility in two ways: (1) the “well-prepared” motion depleted bankruptcy 

estate resources that would otherwise have been available to pay creditor 

claims, including plaintiffs’ approved claim for the October 2005 judgment; 

and (2) the fact that the PW Owners paid $660,000 to settle the motion in 

2010, was evidence they had resources to pay a judgment in 2008. 

Defendants dispute these findings on the ground that there is no

evidence the PW Owners actually paid the $660,000 settlement with their 

own funds, suggesting the money could have been borrowed or gifted to them. 

We are not persuaded by defendants’ speculation; the fact that the settlement 

was paid in 2010 is circumstantial evidence that the PW Owners were 

solvent and had the ability to pay a 2008 money judgment. Evidence 

pertaining to the sanctions motion is also relevant to show another way that 

defendants’ malpractice caused plaintiffs’ damages. If Greene had 

competently opposed the summary adjudication motions and secured a 

judgment against the PW Owners in 2008, the funds used by the bankruptcy 

trustee to prove the fraudulent transfers and alter ego claims would have 

been available to pay a larger portion of the October 2005 judgment, thus 

reducing the unpaid balance and increasing the likelihood of collectibility 

from the individual PW Owners.

4. Deliberate Destruction of Asset Evidence

Defendants do not dispute that the PW Owners destroyed documents in 

order to conceal asset transfers from PW1 to themselves and their other 

companies. However, they contend that the trial court erred by relying on 

this evidence to support its collectibility finding. Specifically, defendants 
25

argue that because the evidence showing what assets were transferred was 

actually destroyed, it would be “utter speculation” to conclude that the 

transferred assets were of sufficient value to pay the judgment in mid-2008.

Defendants’ logic does not withstand scrutiny. The trial court did not 

find that the judgment was collectible from any specific asset that was 

transferred out of PW1; it found that the PW Owners’ deliberate destruction 

of evidence documenting these transfers was relevant evidence of 

collectibility. We agree. The fact that the PW Owners were actively hiding 

their assets is relevant to prove they had funds to pay the 2005 judgment

both before and after defendants should have secured a judgment against 

them in 2008. To analogize, no reasonable homeowner would secure 

worthless baubles in a safe.

Importantly, the issue on appeal is whether all the evidence considered 

together substantially supports the finding that a judgment against the PW 

Owners would have been collectible, not whether any specific item of evidence 

is sufficient by itself to support this finding. Here, we affirm the trial court’s 

collectability finding because Norman’s expert testimony, along with other 

evidence discussed by the trial court, constitutes substantial evidence that a 

hypothetical judgment against the PW Owners would have been collectible. 

As best we can tell, defendants made a strategic decision to ignore the issue 

of collectibility at trial. They did not object to Norman’s expert opinion or 

cross-examine him about it. Nor, apparently, did they elicit testimony or 

offer evidence suggesting that the PW Owners were personally insolvent or 

that their personal financial situations deteriorated at any relevant time. 

Although plaintiffs had the burden to prove collectibility at trial, on appeal 

all doubts are resolved in favor of the judgment. (Citizens Business Bank v. 

Gevorgian (2013) 218 Cal.App.4th 602, 613.)
26

II. The Court Did Not Err By Awarding Interest Damages

Defendants contend that even if a judgment against the PW Owners 

would have been collectible, the trial court erred by finding that plaintiffs’ 

malpractice damages include interest that accrued on the 2005 judgment up 

until entry of judgment in this case. Defendants argue that plaintiffs may 

not recover any interest that accrued on the 2005 judgment after mid-2008, 

when Greene failed to obtain a judgment against the PW Owners in the 

collection case. 

The 2005 judgment is the core component of plaintiffs’ malpractice 

damages because they proved at their trial within a trial that they would 

likely have collected that judgment from the PW Owners in or after 2008 if 

not for defendants’ malpractice. “Interest accrues at the rate of 10 percent 

per annum on the principal amount of a money judgment remaining 

unsatisfied.” (Civ. Proc. Code, § 685.010.) And, since interest on the unpaid 

balance of the 2005 judgment at a rate of 10 percent would have been 

recoverable in the collection action, postjudgment interest on the 2005 

judgment is part of the damages caused by defendants’ malpractice. Thus, 

defendants concede that interest on the 2005 judgment accrued at a rate of 

10 percent per annum at least until mid-2008 when the hypothetical 

judgment should have been secured against the PW Owners.

The issue on appeal is whether plaintiffs incurred additional 

recoverable damages during the period from mid-2008 until entry of the 

malpractice judgment in 2019. Defendants contend that postjudgment 

interest on the 2005 judgment was capped as of the date of the hypothetical 

judgment because the “ever-increasing value” of that judgment after mid2008 is not attributable to the defendants’ malpractice. Plaintiffs counter 

that defendants’ malpractice and the damage caused thereby did not stop in 
27

mid-2008. They take the view that since the 2005 judgment was never 

satisfied, interest that continued to accrue after 2008 is also part of their 

recoverable damages.

To start, we reject defendants’ premise that their malpractice did not 

cause plaintiffs any damages after entry of a hypothetical judgment against 

the PW Owners in or around mid-2008. Findings by the trier of fact show 

that defendants’ inadequate representation continued beyond that date, 

causing the abandonment of viable fraudulent transfer claims in 2009, and 

contributing to the diminishment of plaintiffs’ unsecured bankruptcy claim 

against PW2. For these reasons, the defendants’ motion for a new trial due 

to excessive damages was denied. In its order denying that motion, the court 

found that plaintiffs’ malpractice damages include interest on the 2005 

judgment until entry of the malpractice judgment in June 2019. We affirm 

the finding that interest accruing on the 2005 judgment constitutes damages, 

although we conclude that only part of the award can be justified as 

postjudgment interest.

Under the trial-within-a-trial mechanism that was used to prove 

causation and damages in this malpractice case, the 2005 judgment would 

have been collected and satisfied in 2008 and, at that point, postjudgment 

interest would cease to accrue. Pertinent provisions of the Code of Civil 

Procedure establish that when a money judgment is satisfied in full, 

postjudgment interest ceases to accrue. (Civ. Proc. Code, §§ 685.010–685.030; 

see Bell v. Farmers Ins. Exchange (2006) 137 Cal.App.4th 835, 839–840.) 

These statutes reflect the “underlying reasons for awarding postjudgment 

interest,” which are to “ ‘compensate[] the judgment creditor for the loss of 

use of the money until the judgment is paid and [to act] as an incentive for 

the judgment debtor to pay the judgment promptly.’ ” (Felczer v. Apple Inc. 
28

(2021) 63 Cal.App.5th 406, 418; see also Bruning v. United States (1964) 376 

U.S. 358, 360.) By a parity of reasoning, defendants contend that the date of 

the hypothetical judgment against the PW Owners effectively capped the 

accrual of postjudgment interest for purposes of calculating damages caused 

by the failure to obtain a judgment against the PW Owners. Defendants’

reasoning is sound as far as it goes.

But defendants ignore the fact that the 2005 judgment was not actually 

satisfied in 2008 precisely because of their malpractice. To the extent that 

the vehicle of a hypothetical 2008 judgment limits the accrual of 

postjudgment interest on the 2005 judgment, it also fixes the date upon 

which plaintiffs had a vested claim against these malpractice defendants. 

Civil Code section 3287, subdivision (a) states: “A person who is entitled to 

recover damages certain, or capable of being made certain by calculation, and 

the right to recover which is vested in the person upon a particular day, is 

entitled also to recover interest thereon from that day, except when the 

debtor is prevented by law, or by the act of the creditor from paying the debt.” 

Thus, when postjudgment interest on the 2005 judgment ceased to accrue, 

prejudgment interest on the 2019 malpractice judgment began to accrue. 

(Civ. Code, § 3287, subd. (a).)

Anticipating our conclusion, defendants contend that plaintiffs are not 

entitled to any prejudgment interest under the circumstances presented here. 

These arguments are not persuasive. Defendants contend first that plaintiffs 

forfeited their right to prejudgment interest, citing North Oakland Medical 

Clinic v. Rogers (1998) 65 Cal.App.4th 824, 830–831. That case stands for 

the proposition that a party cannot claim prejudgment interest for the first 

time in a cost bill filed after entry of judgment. The rule does not apply here, 

where plaintiffs sought prejudgment interest in their complaint and were 
29

awarded interest on the 2005 judgment in a statement of decision that was 

reviewed by both parties prior to its adoption. (See Segura v. McBride (1992) 

5 Cal.App.4th 1028, 1041.) 

Defendants also contend that Civil Code section 3287, subdivision (a)

does not apply because damages were not certain or capable of being made 

certain until the malpractice judgment was entered in 2019. Defendants 

reason that because there was conflicting evidence on issues pertaining to

their liability, the amount of money they owed to the plaintiffs could not have 

been made certain until after that liability was established. 

“ ‘Generally, the certainty required of Civil Code section 3287, 

subdivision (a), is absent when the amounts due turn on disputed facts, but 

not when the dispute is confined to the rules governing liability.’ ” (Shell Oil 

Co. v. National Union Fire Ins. Co. (1996) 44 Cal.App.4th 1633, 1651; see also

Hartford Accident & Indemnity Co. v. Sequoia Ins. Co. (1989) 211 Cal.App.3d 

1285, 1305–1307.) Thus, for example, damages are “ ‘capable of being made 

certain . . . where there is essentially no dispute between the parties 

concerning the basis of computation of damages if any are recoverable but 

where their dispute centers on the issue of liability giving rise to damage.’ ” 

(Fireman’s Fund Ins. Co. v. Allstate Ins. Co. (1991) 234 Cal.App.3d 1154, 

1173–1174.) Moreover, even when the plaintiff proposes alternative formulas 

for calculating damages, all of which are disputed, prejudgment interest is 

recoverable so long as the amount of damages is ascertainable under each 

alternative theory and all that is required is a legal determination about 

what measure applies. (Shell Oil Co., at p. 1651.) 

In the present case, the primary disputed issues at trial were whether 

defendants breached their duty of care to plaintiffs and whether that breach 

caused plaintiffs damages. As discussed, collectibility is a component of 
30

causation when the breach of duty is the failure to collect a judgment, and 

collectability was disputed at trial. But there has never been a dispute 

among these parties that the plaintiffs’ loss derives from the failure to collect 

the 2005 judgment. The amount of that judgment and the accrual of 

postjudgment interest up to the date of the hypothetical 2008 judgment are 

ascertainable with mathematical certainty. (See Mussetter v. Lyke (1998) 10 

F.Supp.2d 944, 965 [applying California law].) Defendants concede as much

by attempting to use that formula to limit their liability for damages caused 

by their malpractice. Defendants nonetheless contend that damages were not 

certain or capable of being made certain because the measure of damages—

what plaintiffs would have collected from PW1 in mid-2008—would decline if 

the trial court found the original judgment to be only partially collectible. 

But defendants point to nothing in the record that makes this argument more 

than theoretical—no evidence that partial collectability was argued in the 

trial court or supported by substantial evidence. We therefore decline to 

entertain it here.

In addition, or alternatively, even as to unliquidated claims for tort 

damages, the court sitting as trier of fact has discretion to award 

prejudgment interest under Civil Code section 3288. (Bullis v. Security 

Pacific National Bank (1978) 21 Cal.3d 801, 814, fn. 16.) “Prejudgment 

interest is awarded to compensate a party for the loss of the use of his or her 

property.” (Id. at p. 815.) Interest awarded under section 3288 accrues from 

the time plaintiff incurs the loss. (Michelson v. Hamada (1994) 29 

Cal.App.4th 1566, 1588; Piutau v. Fed. Express Corp. (2003) 2003 U.S.Dist. 

Lexis 6830 *21 [applying California law].)

In sum, the trial court did not err in awarding prejudgment interest on 

the amount plaintiffs would have recovered in 2008, absent defendants’ 
31

malpractice. Either because the recoverable amount was fixed as of mid-2008 

or because these are tort damages, prejudgment interest is proper. (See Civ. 

Code, §§ 3287, subd. (a); 3288).

III. Damages Must Be Recalculated

Finally and more persuasively, defendants contend that even if 

plaintiffs are entitled to prejudgment interest, the damages award is 

excessive for several reasons. First, all interest damages were calculated at a 

rate of 10 percent per annum. The statement of decision adopts the plaintiffs’ 

calculation of damages, which is quite difficult to decipher but does appear to 

calculate all components of interest damages at a rate of 10 percent per 

annum. Defendants contend that prejudgment interest cannot exceed 

7 percent per annum because plaintiffs’ malpractice claim was not “based in 

contract.” 

When an action is not based on a contract, “the rate of prejudgment 

interest should be that fixed by article XV, section 1 of the California 

Constitution; namely, 7 percent per annum.” (Children’s Hospital & Medical 

Center v. Bonta (2002) 97 Cal.App.4th 740, 775.) However, in an action on a

contract, when the contract does not stipulate a legal rate of interest, “the 

obligation shall bear interest at a rate of 10 percent per annum after a

breach.” (Civ. Code, § 3289.)

Our Supreme Court has found that “legal malpractice constitutes both 

a tort and a breach of contract.” (Neel v. Magana, Olney, Levy, Cathcart & 

Gelfand (1971) 6 Cal.3d 176, 180–181.) And here, the plaintiffs’ malpractice 

complaint contains causes of action for breach of contract, as defendants 

concede. However, according to the statement of decision, “[d]uring trial of 

this matter, Plaintiffs confirmed that they are only pursuing their claims for 

Professional Negligence and are dismissing their other causes of action.” 
32

Thus, we agree with defendants that prejudgment interest on the malpractice 

judgment must be calculated at a rate of 7 percent per annum rather than 

the 10 percent per annum interest rate applicable to contract claims.

2 

Defendants also point out other aspects of the damages calculation that 

are either erroneous or indecipherable. For example, the calculation uses a 

2015 renewed judgment that was obtained against PW1 to increase the 

principal amount of the malpractice judgment, which is an error since 

postjudgment interest on the 2005 judgment stopped accruing in 2008. 

Furthermore, the two partial recoveries of the 2005 judgment that plaintiffs

received are deducted from a running total of malpractice damages as if they 

were paid in 2015, instead of accounting for those recoveries when they 

actually happened in 2006 and 2013. 

Although these objections by defendants are well taken, defendants do 

not propose an alternative calculation of damages that includes an award of 

prejudgment interest on the hypothetical 2008 judgment. For their part, 

plaintiffs ignore problems with the damages calculation, shedding no light on 

how interest components of the award might be justified or explained. As the 

trier of fact in this case, the trial court must recalculate plaintiffs’ damages, 

distinguishing between postjudgment interest on the 2005 judgment, and 

prejudgment and postjudgment interest on the malpractice judgment, 

accounting for credits when they occurred, and clarifying other ambiguities in 

2 Plaintiffs object that this reduction in rates means defendants’ 

malpractice has unjustifiably cost them three percentage points in the

interest they were otherwise guaranteed on the original judgment. But the 

original judgment was collectable only from unscrupulous businessmen 

intent on hiding assets, while the malpractice judgment is against a different 

set of defendants.
33

the calculation previously adopted. (See Thompson v. Asimos (2016) 

6 Cal.App.5th 970.)

DISPOSITION

The judgment of liability is affirmed but the damages award is vacated 

and this matter is remanded to the trial court for a recalculation of plaintiffs’ 

damages that is consistent with this opinion. The parties are to bear their 

own costs on appeal.

TUCHER, P.J.

WE CONCUR:

FUJISAKI, J.

RODRIGUEZ, J.

Samuels et al. v. Hamrick & Evans, LLP et al. (A158688, A158878)