Court Opinion

ID: 4583304
Source: CourtListenerOpinion
Date Created: 2020-11-03 20:02:16.169013+00
Date Added: 2024-06-11T13:42:51.085091
License: Public Domain

Filed 11/3/20 Ruben v. Friedman CA2/2
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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has not been certified for publication or ordered published for purposes of rule 8.1115.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

                         SECOND APPELLATE DISTRICT

                                        DIVISION TWO

CHARLES E. RUBEN,                                                   B300392
                                                                    (c/w B305624)
     Plaintiff, Cross-defendant and
Respondent,                                                         (Los Angeles County
                                                                    Super. Ct.
         v.                                                         No. BC649012)

NATHANIEL J. FRIEDMAN,

     Defendant, Cross-complainant
and Appellant.

     APPEAL from a judgment of the Superior Court of
Los Angeles County. Maureen Duffy-Lewis, Judge. Affirmed.

     Nathaniel J. Friedman, in pro. per., for Defendant, Cross-
complainant and Appellant.

     Schindler Eyrich, John F. Eyrich; Lewis Brisbois Bisgaard
& Smith, Raul L. Martinez, Kenneth C. Feldman and Patrik
Johannson for Plaintiff, Cross-defendant and Respondent.

                               _________________________
       Appellant Nathaniel J. Friedman (Friedman) appeals a
judgment awarding Charles E. Ruben (Ruben) contract damages,
interest and costs after a jury found that Friedman failed to pay
for Ruben’s legal services. Friedman contends that the judgment
must be reversed because: (1) Ruben’s contract was void and
unenforceable, (2) he was not entitled to quantum meruit
recovery in the alternative, and (3) the trial court erred when it
granted summary judgment on the cross-complaint against
Ruben for legal malpractice. In a consolidated appeal, Friedman
contends that the trial court’s award of attorney fees to Ruben
must be reversed if the judgment is reversed. We find no error
and affirm in all respects.
                               FACTS
The Complaint
       Ruben sued Friedman for breach of contract, account
stated, services rendered and quantum meruit, alleging:
Friedman retained Ruben to provide legal services with respect
to a pending foreclosure against Friedman’s house in Beverly
Hills. Though Ruben provided legal services as agreed, Friedman
refused to pay his legal fees.
       The parties’ contract, which was attached to the complaint,
stated that Ruben would: (1) file a complaint against Nationstar
Mortgage, I.LC. (Nationstar), to obtain a temporary restraining
order and preliminary injunction to stop the foreclosure sale set
for April 14, 2016, on Friedman’s residence; (2) seek a temporary
restraining order and preliminary injunction by ex parte
application; and (3) file a complaint against Nationstar for, inter
alia, unlawful business practices in violation of Business and
Professions Code section 17200, wrongful foreclosure, intentional
infliction of emotional distress, negligent infliction of emotional

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distress, breach of contract, breach of the covenant of good faith
and fair dealing, and common counts. Per the contract, Ruben’s
hourly rate was $400 and Friedman agreed to pay his bills
monthly.
The Cross-Complaint
       Friedman sued Ruben for legal malpractice, alleging he
hired Ruben for representation in an action against Nationstar
and that Ruben breached his duty of care by: failing to determine
the exact amount Friedman owed Nationstar; failing to obtain a
copy of 12 Code of Federal Regulations, part 1024, a regulation
that gives a borrower a regulatory basis for demanding that a
lender provide the specific amount owed on a loan; and failing to
obtain a preliminary injunction. The cross-complaint alleged that
Ruben’s breaches caused Friedman to pay Nationstar $125,000
he did not owe.
Summary Judgment on the Cross-Complaint
       Ruben moved for summary judgment on the cross-
complaint and argued that Friedman could not establish that he
suffered damages.
       The motion averred that Friedman filed a state action
against Nationstar in March 2015 alleging, inter alia, that it
wrongfully demanded that he deposit money into an impound
account to pay for taxes and insurance. The state court granted
summary judgment for Nationstar, concluding that Friedman
entered a loan modification agreement in which he agreed to fund
an impound account for taxes and insurance, he refused to make
sufficient payments to the impound account, he breached the loan
modification agreement, and there were no triable issues
regarding Friedman’s claims. The judgment was affirmed on
appeal.

                                3
       At that point, Friedman hired Ruben. He filed a federal
action on behalf of Friedman alleging Nationstar had not given
Friedman credit for the property insurance and property taxes
that he had paid directly. At the time, Nationstar had refunded
$94,392.83 to Friedman, including $14,242.79 for property taxes
and $3,624 for property insurance. After Nationstar prevailed on
a motion to dismiss, Ruben filed a first amended complaint
adding a cause of action for financial elder abuse. At some point,
the federal court enjoined Nationstar from foreclosing on
Friedman’s house. Subsequently, Nationstar attended a hearing
at which it presented a detailed transaction history of Friedman’s
account indicating that he currently owed $124,410.44.
Friedman paid that sum and his loan was reinstated. The first
amended complaint was later dismissed with leave to amend. On
September 21, 2016, Ruben substituted out of the federal action.
Friedman, representing himself, filed a second amended
complaint in the federal action that contained the same causes of
action as the first amended complaint but added allegations that
he paid $124,410.44 due to Nationstar’s undue influence and the
threat that he would lose his house. He sought the return of the
$124,410.44. The following month, Nationstar moved to dismiss
the second amended complaint and the federal court granted the
motion with prejudice.
       In his papers, Ruben argued that the state and federal
action involved the same primary right, and that the federal
action was barred by res judicata. Next, he argued that he e-
mailed Friedman the exact amount Nationstar claimed was due
and therefore did not breach a duty to determine that amount. In
addition, Ruben argued he did not cause Friedman damage by
failing to obtain a preliminary injunction because Ruben’s efforts

                                4
prevented foreclosure on Friedman’s residence. Finally, Ruben
claimed that Friedman was unable to prove he did not owe
Nationstar $125,000 and was damaged by having to pay that
sum.
       In opposition, Friedman argued that the motion for
summary judgment should be denied because Ruben failed to
offer declarations establishing that he met the standard of care
and did not cause damage. Friedman also argued that the state
action was not res judicata.
       The trial court ruled as follows: “It is undisputed that the
State Court, the Federal Court and the State Appellate Court
have all determined that Friedman violated the Modification
Agreement. It is undisputed that the Moving Party Ruben was
successful in preventing foreclosure. The summary judgment in
the State action acted as a bar to the Federal Action under
res judicata. It is undisputed that Friedman obtained a specific
amount of money owed. [¶] Therefore, the Motion for Summary
Judgment is Granted.”
Trial on the Complaint; the Special Verdict; Judgment
       Opening Arguments
       In his opening argument, counsel for Ruben argued that
the case was a simple one: Friedman hired Ruben for legal
services, Ruben performed those legal services, and then
Friedman refused to pay the agreed fees.
       Friedman’s attorney, in contrast, argued that the retainer
agreement was an illegal contract because Ruben illegally
charged upfront fees.
       Testimony Regarding Nonpayment of Fees
       Ruben testified that he was retained by Friedman to stop
the foreclosure on his residence. Friedman paid Ruben $5,000 on

                                 5
one occasion, $10,000 on another, and $2,238.81 on yet another.
Ruben stopped representing Friedman on September 22, 2016,
and he refused to pay Ruben’s final bill of $153,620.11.
       Testimony Regarding the Scope of Ruben’s Services and the
Legality of the Retainer Agreement
       Ruben testified that when he met Friedman in March 2016,
Friedman did not ask Ruben to obtain a loan modification or loan
forbearance. Afterwards, Ruben prepared a retainer agreement
that stated the scope of engagement. Ruben asserted that the
retainer agreement accurately reflected all the promises he made.
       Friedman, who was cocounsel for the defense with another
attorney, cross-examined Ruben and asked if he was familiar
with Civil Code sections 2944.71 and 2944.8 when he first
represented Friedman. Ruben said that he had not been familiar
with them.
       Friedman quoted section 2944.7 to Ruben as establishing
that a person who performs either mortgage loan modification or
mortgage loan forbearance services cannot collect a fee until after
the person has fully performed every service he or she agreed to
perform.
       When Friedman testified, he stated that he did not think
he specifically asked Ruben to perform a loan modification.
However, Friedman said he asked Ruben “to do something. Call
Nationstar, see what [he] could do to get these people to move,
which in my mind I guess is a loan modification.” Friedman also
testified, “I don’t think I ever used the words ‘loan modification,’

1    All further statutory references are to the Civil Code unless
otherwise indicated.

                                 6
but that was my clear intent. Why else would I have him contact
Nationstar. . . . ?”
       The Special Verdict
       A special verdict form was submitted to the jury. In
question No. 1, the jury was asked whether Ruben and Friedman
entered a contract for legal services. It answered yes. Question
No. 2 asked: “Did [Friedman] prove that in the retainer
agreement . . . Ruben agreed to negotiate, attempt to negotiate,
arrange, attempt to arrange, or otherwise offer to perform a
mortgage loan modification or other form of mortgage loan
forbearance for a fee or other compensation paid by [Friedman]?”
The jury answered no. Because the answer was no, the jury
skipped ahead to question No. 7 and concluded that Friedman
breached the contract. Last, the jury concluded that the total
amount of contract damages to be awarded to Ruben was
$148,564.11.
       When the jury found a breach of contract and that Ruben
did not contract to provide mortgage loan modification or
mortgage loan forbearance services, it skipped the questions
asking it to determine whether the retainer agreement was
enforceable or whether Ruben was entitled to the reasonable
value of his services.
       Judgment
       The trial court entered judgment awarding Ruben
$148,546.11 in damages, $38,708.08 in prejudgment interest, and
costs to be determined.
       Friedman appealed.
       Award of Attorney Fees; Amended Judgment
       Based on a memorandum of costs and a motion for attorney
fees filed by Ruben, the trial court awarded Ruben $17,345.26 in

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costs and $215,115 in attorney fees. The trial court entered an
amended judgment to reflect the addition of these amounts to the
original award of damages and interest.
       Friedman filed his second appeal.
                           DISCUSSION
I. Enforceability of the Retainer Agreement.
       A contract is unenforceable if it is contrary to the law.
(Sheppard Mullin, Richter & Hampton, LLC v. J-M
Manufacturing Co, Inc. (2018) 6 Cal. 5th 59, 73.) Friedman
argues that the retainer agreement is void and therefore
unenforceable because Ruben violated sections 2944.6, 2944.7,
and 2944.8 by receiving compensation before completing his legal
services. Friedman contends that this is a matter of statutory
interpretation.2
       Theoretically, we would engage in de novo review. (Klem v.
Access Ins. Co. (2017) 17 Cal. App. 5th 595, 619.) But Friedman
does not argue that the trial court misinterpreted the statutory
scheme. Ruben informs us that Friedman successfully asked the
trial court to allow the jury to decide whether the retainer
agreement was void based on section 2944.7. We cannot verify
this because the record is incomplete. Although it indicates that
Friedman submitted jury instructions on this topic, it does not
indicate whether they were given. The inference, however, is
that the instructions were given because the special verdict form
asked the jury to determine whether Ruben violated section

2     Ruben contends that Friedman is challenging the jury’s
findings, and that the standard of review is the substantial
evidence test. But at no point in his briefs does Friedman
suggest the evidence was insufficient.

                                8
2944.7 and whether, as a result, the retainer agreement was
unenforceable. In the reply, Friedman suggests that the trial
court erred when it gave the issue to the jury. We conclude any
error was invited because the jury decided the case based on
instructions and a special verdict form Friedman either
requested or accepted without objection. (Newton v. Thomas
(1955) 137 Cal. App. 2d 748, 763.)
       This could end our analysis. To be complete, we explain
why Friedman’s urged statutory interpretation lacks merit.
       Section 2944.6, subdivision (a) provides that when a person
negotiates, attempts to negotiate, arranges, attempts to arrange,
or otherwise offers to perform a mortgage loan modification or
form of mortgage loan forbearance for a fee or other compensation
paid by the borrower, that person shall provide the borrower a
separate statement notifying him or her, inter alia, that “[i]t is
not necessary to pay a third party to arrange for a loan
modification or other form of forbearance from your mortgage
lender or servicer. You may call your lender directly to ask for a
change in your loan terms.” (§ 2944.6, subd. (a).)
       Section 2944.7, subdivision (a) provides that it is unlawful
for a person providing such services to demand or receive
compensation until every service promised has been performed.
Next, section 2944.8 provides that if a person violates section
2944.7, and if the victim is a senior citizen or a person with a
disability, the violator is subject to a $2,500 civil penalty for each
transgression.
       In his opening brief, Friedman contends that In the Matter
of Taylor (Review Dept. 2012) 5 Cal. State Bar Ct. Rptr. 221
(Taylor) establishes that the statutory scheme applies to this
case. We note that though State Bar opinions are not binding,

                                  9
they constitute persuasive authority. (McDermott Will & Emery
LLP v. Superior Court (2017) 10 Cal. App. 5th 1083, 1113.)
        In Taylor, the State Bar alleged that an attorney violated
section 2944.7 by collecting preperformance fees and violated
section 2944.6 by failing to provide borrowers with the requisite
notice. (Taylor, supra, 5 Cal. State Bar Ct. Rptr. at pp. *21–22.)
When reviewing the findings of a lower tribunal, the State Bar
Court found that the attorney provided loan modification services
based on the following facts. Two of his agreements were titled
“Loan Modification Retainer.” (Id. at pp. *23–24.) While the
other agreements were titled “Legal Services Retainer,” the
introductory e-mails to the clients introduced the law firm as a
loan modification service provider, and the agreements stated
that the fees being charged included items which were part of
loan modifications.
        Taylor stands for the unremarkable proposition that the
statutes apply when an attorney contracts to provide loan
modification services. It did not consider whether the statutory
scheme applies when an attorney contracts to pursue litigation
with the goal of forestalling foreclosure and obtaining damages
on various theories. Cases are not authority for propositions that
went unconsidered. (City of Bellflower v. Cohen (2016) 245
Cal. App. 4th 438, 452.)
         Aside from his citation to Taylor, Friedman’s opening brief
is full of incoherent ramblings in which he implies that any
attorney who contracts to represent a borrower in litigation to
forestall a foreclosure and obtain damages is providing mortgage
loan modification or mortgage loan forbearance services. But he
has not offered any statutory interpretation on the matter. His
position “is strongly reminiscent of those magazine puzzles of

                                10
yesteryear where the reader was challenged to ‘guess what is
wrong with this picture.’” (People v. Dougherty (1982) 138
Cal. App. 3d 278, 280.)
       In his reply brief, Friedman cites section 3528, which
provides: “The law respects form less than substance.” He goes
on to suggest that Ruben’s legal services are equivalent to
mortgage loan modification services. But Friedman has not
backstopped his assertion with analysis. “‘When an appellant
fails to raise a point, or asserts it but fails to support it with
reasoned argument and citations to authority, we treat the point
as waived. [Citations.]’” (Nelson v. Avondale Homeowners Assn.
(2009) 172 Cal. App. 4th 857, 862.)
       Absent a showing of error, we must presume Ruben’s
retainer agreement was enforceable. (Denham v. Superior Court
(1970) 2 Cal. 3d 557, 564.)
II. Quantum Meruit.
       “[I]n a case of a contract to pay for services which is void as
against public policy, there arises an implied contract to pay for
services rendered thereunder, and the remedy of action sounding
in quantum meruit is available to recover the reasonable value
thereof.” (Wiley v. Silsbee (1934) 1 Cal. App. 2d 520, 522.) If the
retainer agreement is void, Friedman urges us to conclude that
Ruben is barred from seeking the reasonable value of his services
on remand. This issue is moot because Friedman has not shown
that the retainer agreement is void.
III. Summary Judgment.
       Friedman’s challenges to the trial court’s summary
judgment ruling fail because the record is inadequate for review.
It does not contain, inter alia, Ruben’s separate statement, his
compendium of exhibits, or the declarations of Ruben and Patrik

                                  11
Johannson. Where, as here, the record is inadequate for review,
the trial court’s decision must be affirmed by default. (Gee v.
American Realty & Construction, Inc. (2002) 99 Cal. App. 4th
1412, 1416.)
IV. Attorney Fees.
       Friedman requests reversal of the attorney fees award if we
conclude that the retainer agreement was void. Because we have
determined that the retainer agreement was enforceable, we
must affirm the attorney fees award.
       All other issues are moot.
                           DISPOSITION
       We affirm the judgment. Ruben is entitled to his costs on
appeal.
       NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.

                                     ________________________, J.
                                     ASHMANN-GERST

We concur:

___________________________, P. J.
LUI

___________________________, J.
HOFFSTADT

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