Court Opinion

ID: 9945506
Source: CourtListenerOpinion
Date Created: 2024-02-27 21:03:32.013351+00
Date Added: 2024-06-11T14:25:30.996342
License: Public Domain

Filed 2/27/24 Aguila v. Nong CA2/1
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                         SECOND APPELLATE DISTRICT

                                        DIVISION ONE

 HENRY AGUILA et al.,                                                B327285

           Plaintiffs and Appellants,                                (Los Angeles County
                                                                     Super. Ct. No. 22STCV24716)
           v.

 JULIE NGOC NONG et al.,

           Defendants and Respondents.

      APPEAL from a judgment of the Superior Court of Los
Angeles County, William F. Fahey, Judge. Affirmed.
      The Tym Firm and Ronald D. Tym for Plaintiffs and
Appellants.
      Nemecek & Cole, Michael McCarthy and Daniel L. Reback
for Defendant and Respondent Julie Ngoc Nong.
      Gordon Rees Scully Mansukhani and James K. Holder for
Defendants and Respondents John Fitzpatrick Vannucci and Law
Offices of John Fitzpatrick Vannucci.
                     ______________________
      Plaintiffs and appellants Henry Aguila, Thee Aguila, Inc.
(TAI), and Rocio Rosales challenge the trial court’s decision
sustaining demurrers without leave to amend filed by their
former attorneys, defendants and respondents Julie Ngoc Nong
and John Fitzpatrick Vannucci, to plaintiffs’ legal malpractice
claims.1 Plaintiffs allege that in the underlying litigation against
their insurance company, defendants failed to withdraw a
settlement offer contrary to plaintiffs’ instructions and allowed
judgment to be entered on the accepted offer.
       The trial court agreed with defendants that Aguila and TAI
lacked standing because they assigned their economic interest in
the underlying case to Rosales before the alleged malpractice,
and that Rosales could not state a claim for malpractice because,
among other reasons, her claim was time-barred.
       Plaintiffs contend they can cure the defect as to Aguila and
TAI’s standing by amending their complaint to allege that
Rosales later reassigned a portion of the case back to Aguila and
TAI without violating California’s prohibition on the assignment
of malpractice claims, or that despite court filings to the contrary
Aguila and TAI did not in fact assign all their economic interest
in the underlying case to Rosales. They also argue the trial
court’s statute of limitations ruling was erroneous because the
amended complaint that added Rosales as a plaintiff relates back
to the timely original complaint. We disagree and affirm, as we
explain below.

      1 The complaint also named as defendants NT Law, the
name under which Nong does business, and the Law Offices of
John Fitzpatrick Vannucci.

                                 2
            FACTS AND PROCEEDINGS BELOW
       In 2019, Aguila and TAI filed suit in federal court against
Penn-Star Insurance Company alleging breach of a commercial
insurance policy. The docket in the case indicates that
defendants represented Aguila and TAI in the litigation, but it
does not list Rosales, who is Aguila’s wife, as a plaintiff, nor as a
client of defendants. In July 2021, Aguila and TAI submitted an
offer under Federal Rules of Civil Procedure, rule 68 (28 U.S.C.)
and Code of Civil Procedure section 9982 to settle the case for
$1,995,000. Penn-Star accepted the offer on August 5, 2021, and
the federal district court entered final judgment on the basis of
the settlement on August 17, 2021. Plaintiffs allege they
instructed their attorneys to withdraw the settlement offer after
Penn-Star accepted it because Penn-Star’s acceptance attempted
(in ways plaintiffs do not explain) to alter the terms of the offer,
but the attorneys instead permitted judgment to be entered.
       On June 22, 2021, about one month before Aguila and TAI
submitted their settlement offer, a judgment creditor of Aguila
filed a notice of lien in the case, and in September 2021, after the
district court had entered judgment, the creditor filed a motion to
apply the proceeds of Aguila and TAI’s judgment to the judgment

      2 These provisions allow a party to serve a settlement offer
on its opponent. If the recipient rejects the offer and then fails to
obtain a more favorable judgment or award, it is liable for its
opponent’s litigation costs from the time of the offer. (Madrigal v.
Hyundai Motor America (2023) 90 Cal.App.5th 385, 397 [Code
Civ. Proc., § 998], review granted Aug. 30, 2023, S280598; Lang v.
Gates (9th Cir. 1994) 36 F.3d 73, 74 [Fed. Rules Civ. Proc., rule
68, 28 U.S.C.].) Unless otherwise specified, subsequent statutory
references are to the Code of Civil Procedure.

                                  3
creditor. Rosales filed a motion to intervene alleging that she
had orally agreed with Aguila to “fund all of the subsequent fees
and costs of the present litigation in exchange for an assignment
to her by [Aguila and TAI] of all of their economic interests in . . .
the present litigation.” She argued that she should be allowed to
intervene because her interest in the litigation was superior to
that of the lien claimant, and that her “interests cannot be
adequately represented by any of the parties to the present
litigation.” As an exhibit, Rosales included a document dated
April 27, 2021, in which Aguila agreed to assign and transfer to
her in return “[f]or value received . . . all economic interest in the
case,” as well as a screenshot from an email application
indicating that Aguila sent the assignment agreement to Rosales
on May 1, 2021. Aguila filed a declaration affirming that he was
“the 100 [percent] owner [of TAI] at the time”3 and that he had
“assign[ed] 100 [percent] of [Aguila and TAI]’s economic interest
in the . . . litigation” to Rosales.
      On August 1, 2022, Aguila and TAI filed the complaint in
the instant case alleging that defendants had committed
professional negligence by “fail[ing] to follow plaintiffs’
instructions to withdraw an offer to settle and then allow[ing]
judgment to be entered on the accepted offer.” As a result, Aguila

      3 On May 11, 2021, in a separate case, the superior court
ordered Aguila to turn over all of his shares in TAI to a different
judgment creditor upon service of a writ of execution. In
subsequent contempt proceedings in that case, the superior court
found that Aguila was aware of the pending turnover order, but
transferred his shares in TAI to his wife Rosales before the order
was issued.

                                  4
and TAI claimed they were unable to obtain the full $38,999,172
they sought in damages in the case.
        Defendant attorneys demurred on the ground that Aguila
and TAI lacked standing: because they had no economic interest
in the case at the time of the alleged negligence, Aguila and TAI
could not have suffered any damages. Before the trial court ruled
on the demurrer, plaintiffs filed the operative first amended
complaint adding Rosales as a plaintiff. In the new complaint,
plaintiffs alleged that, as a result of the assignment, “Rosales is a
proper plaintiff in this action. Plaintiffs are unsure of which, or
all, of the named plaintiffs are the proper plaintiffs to prosecute
this action; as such, all possible plaintiffs have been named.”
(Capitalization omitted.)
        Defendants again demurred, and the trial court sustained
the demurrer and dismissed plaintiffs’ complaint without leave to
amend. The court found that Aguila and TAI lacked standing
because, “The alleged malpractice by the defendant attorneys
occurred after [the] assignment to Rosales.” Rosales likewise
lacked standing because, “The docket in the underlying federal
case does not show that the defendants in this case ever
represented Rosales. In fact, the docket shows that Rosales
attempted to intervene in the federal case through another
attorney . . . . As a result, defendants’ alleged malpractice could
only be as to Aguila and [TAI].” (Fn. omitted.) Even if Rosales
did have standing, the court concluded her claim would be barred
by the one-year statute of limitations for legal malpractice claims.
(§ 340.6.) Rosales was added as a plaintiff in the first amended
complaint, filed November 28, 2022, more than one year after the
federal district court entered judgment on the basis of the offer to
compromise.

                                 5
                   STANDARD OF REVIEW
       “In assessing whether the trial court erred in this ruling,
we ask two questions: ‘(1) Was the demurrer properly sustained;
and (2) Was leave to amend properly denied?’ [Citation.]” (Engel
v. Pech (2023) 95 Cal.App.5th 1227, 1234-1235 (Engel).) In
answering the first question, we must “determine de novo
whether the complaint alleges facts sufficient to state a cause of
action or discloses a complete defense.” (Regina v. State of
California (2023) 89 Cal.App.5th 386, 396.) In our review, we
“ ‘must assume the truth of the complaint’s properly pleaded or
implied factual allegations’ ” (Banis Restaurant Design, Inc. v.
Serrano (2005) 134 Cal.App.4th 1035, 1038), subject to the
exception that we are “not required to accept the truth of alleged
facts in an amended complaint that are inconsistent with the
allegations in a superseded complaint unless the inconsistencies
are adequately explained.” (Phoenix Mechanical Pipeline, Inc. v.
Space Exploration Technologies Corp. (2017) 12 Cal.App.5th 842,
846.) We may also take judicial notice of a party’s pleadings and
positions in other cases and disregard allegations in the current
complaint that contradict the earlier pleadings. (Larson v. UHS
of Rancho Springs, Inc. (2014) 230 Cal.App.4th 336, 344.)
       We review for abuse of discretion the trial court’s decision
to deny the plaintiff leave to amend (§ 472c, subd. (a)), and in so
doing “must determine whether there is a reasonable possibility
that the defect [in the pleading] can be cured by amendment.”
(Phoenix Mechanical Pipeline, Inc. v. Space Exploration
Technologies Corp., supra, 12 Cal.App.5th at p. 847.) Although it
is the plaintiff’s burden to show how the complaint can be
amended, “ ‘a plaintiff can make “such a showing . . . for the first

                                 6
time to the reviewing court” [citation].’ ” (Mercury Ins. Co. v.
Pearson (2008) 169 Cal.App.4th 1064, 1072.)
                          DISCUSSION
A.      Plaintiffs’ Proposed Amendment Would Not Cure
        Aguila and TAI’s Lack of Standing
        “Standing is related to the requirement contained in . . .
section 367 that ‘[e]very action must be prosecuted in the name of
the real party in interest, except as otherwise provided by
statute.’ (. . . § 367.) The real party in interest is generally the
person who has the right to sue under the substantive law.”
(River’s Side at Washington Square Homeowners Assn. v.
Superior Court (2023) 88 Cal.App.5th 1209, 1225.) “Where
someone other than the real party in interest files suit, the
complaint is subject to a general demurrer. (. . . § 430.10 . . . .)”
(Estate of Bowles (2008) 169 Cal.App.4th 684, 690.)
        As a general rule, a party has standing to sue and is the
real party in interest if he or she has “ ‘suffered or is about to
suffer an injury of sufficient magnitude reasonably to assure that
all of the relevant facts and issues will be adequately presented
to the adjudicator.’ ” (CashCall, Inc. v. Superior Court (2008) 159
Cal.App.4th 273, 286, quoting Holmes v. California Nat. Guard
(2001) 90 Cal.App.4th 297, 315.) The trial court concluded that
plaintiffs’ own filings in the underlying suit against Penn-Star
showed that Aguila and TAI lacked standing. In their
declarations in the insurance case, Aguila and Rosales stated
that Aguila, acting on behalf of himself and TAI, had assigned all
economic interest in the case to Rosales in April 2021.
Defendants’ alleged wrongdoing occurred at some point between
August 5, 2021, when Penn-Star accepted the offer and
August 17, 2021 when the federal district court entered

                                  7
judgment. Because Aguila and TAI no longer had any economic
stake in the outcome of the case at this point in August 2021, the
trial court found that they could not have been injured by their
attorneys’ failure to withdraw the settlement offer.
       In their appellate briefing, plaintiffs do not take issue with
the trial court’s reasoning. Instead, they argue they can cure the
defect by amending the complaint to allege that, at some later
point, “Rosales assigned back to Aguila and TAI 50 [percent] of
their previous economic interests in the [insurance case],
excluding amounts which had been deposited with the federal
court as part of an interpleader case arising from the” insurance
case.
       We disagree that the proposed amendment would allow
Aguila and TAI to sufficiently allege standing. Plaintiffs do not
specify when the alleged reassignment occurred, but they concede
it happened “after the alleged failure of [d]efendants . . . to follow
the direction of [plaintiffs] to withdraw the settlement offer”
(italics added). This is consistent with the declarations Aguila
and Rosales submitted in the underlying litigation in September
2021, one month after judgment was entered, which mentioned
only the initial assignment to Rosales, and said nothing about
any purported assignment back to Aguila and TAI. By plaintiffs’
own admission, then, Aguila and TAI did not regain an economic
interest in the underlying case until after the alleged damage
caused by defendants occurred in August 2021.
       This is fatal to Aguila and TAI’s argument because it
means that the only one whose economic interests could have
been harmed by defendants’ alleged failure to withdraw the
settlement offer was Rosales, because at the time of that alleged
failure only she would have been entitled to the proceeds of any

                                  8
larger judgment. Thus, Rosales alone had standing to sue for
malpractice.4 Rosales was free to assign 50 percent of the
economic interest in the underlying case back to Aguila and TAI
after the settlement, but “legal malpractice claims are not
assignable as a matter of California public policy” (Curtis v.
Kellogg & Andelson (1999) 73 Cal.App.4th 492, 504) and
Rosales’s alleged reassignment thus could not have included any
such claims from the time when she was allegedly injured.
       After the alleged reassignment, Aguila received an
economic interest in the settlement with Penn-Star and nothing
more. He was in a position analogous to that of one of the
plaintiffs in Keru Investments, Inc. v. Cube Co. (1998) 63
Cal.App.4th 1412, who purchased an earthquake-damaged
apartment building with full knowledge of the defects. (Id. at
p. 1415.) When the plaintiff later discovered new information
suggesting that a contractor had done substandard work in a
seismic retrofit for the previous owner, it sued the contractor.
(Id. at p. 1416.) The court held that the plaintiff lacked standing
because the cause of action “arose against [the contractor] either
when the defective work was completed or when the building
sustained damage as the result of the Northridge earthquake.
Neither the wrongful act nor the damages occurred while [the
plaintiff] was the owner.” (Id. at p. 1423.)
       The same reasoning applies here, because the wrongful act
and damages are alleged to have occurred when Rosales owned

      4 For the purposes of our decision, we accept as true
plaintiffs’ allegation that, “after the assignment [from Aguila and
TAI to Rosales], [d]efendants . . . directly represented Rosales in
pursuing her claims.”

                                 9
100 percent of the economic proceeds of the lawsuit against Penn-
Star. Any claim that malpractice damaged the lawsuit’s value
belonged to Rosales, because she owned all of the economic
interest in the case against the insurance company at the time
the asserted malpractice occurred, and thus was the only one
economically injured by that alleged malpractice. That Aguila
and TAI later acquired a partial interest in the lawsuit after the
alleged malpractice damaged its value does not give them a right
to sue for malpractice that previously occurred when they had no
economic interest in the lawsuit. By the time Rosales
purportedly reassigned a portion of the economic interest in the
Penn-Star case to Aguila and TAI, the settlement was final; the
wrongful act and resulting damage had already occurred.
Rosales could transfer some or all of her monetary interest in the
settlement proceeds to Aguila and TAI (subject of course to
competing lienholder claims), but as noted above she could not
assign any malpractice claim she had to Aguila and TAI given
California’s prohibition on such assignments.
      For the first time at oral argument, plaintiffs proposed
amending their complaint to allege that the purpose of the
assignment was to give Rosales a security interest in the
proceeds of the suit as collateral for Rosales’s financing the
expenses of the insurance case, and not all of the economic
interest in the insurance lawsuit. The written assignment
agreement signed by Aguila and filed by plaintiffs in the
insurance case makes no mention of this arrangement, but
plaintiffs explain that an oral agreement between Aguila and
Rosales nevertheless existed.
      We assume without deciding that plaintiffs did not forfeit
this argument by failing to make it in their briefing. This new

                               10
amendment would not cure Aguila and TAI’s lack of standing
because it would run afoul of the sham pleading doctrine, under
which “a pleader cannot circumvent prior admissions by the easy
device of amending a pleading without explanation.” (Womack v.
Lovell (2015) 237 Cal.App.4th 772, 787.) The amendment
proposed at oral argument is only the latest in a series of steps by
plaintiffs to change their allegations to suit their current needs,
with no regard to inconsistencies with their prior positions. In
the insurance case, when it was necessary for Rosales to establish
“a property interest in the present litigation and the proceeds of
the [f]inal [j]udgment superior to those of” Aguila’s creditor,
plaintiffs presented the assignment as a transfer “of all of [Aguila
and TAI’s] economic interests in and to the present litigation.”
(Italics added.) When it became convenient in this case to
attempt to show that both Aguila and Rosales had suffered an
economic injury and thus had standing, plaintiffs proposed
amending the complaint “to allege that . . . Rosales assigned back
to Aguila and TAI 50[ percent] of their previous economic interest
in the” insurance case. Finally, at oral argument, they put
forward a new theory that despite its plain language the initial
assignment was not a transfer of all of Aguila’s and TAI’s
economic interest in the case, but only gave Rosales a security
interest. Plaintiffs made no effort to square the new allegation
with their previous claims. These are not efforts to “correct[ ]
erroneous allegations or . . . ambiguous facts,” but rather are
precisely the type of “abuse of process” the sham pleading
doctrine was designed to prevent. (Hahn v. Mirda (2007) 147
Cal.App.4th 740, 751.)

                                11
B.     Rosales’s Claim Was Barred by the Statute of
       Limitations
       Turning to Rosales, as to her the trial court sustained the
demurrer without leave to amend both because the docket in the
underlying lawsuit showed that Rosales was not defendants’
client, and because the first amended complaint, which added
Rosales as a plaintiff, was not filed within the one-year statute of
limitations for legal malpractice. (§ 340.6.) Rosales takes issue
with both of these conclusions. We need not consider whether
Rosales was defendants’ client, because assuming that she was,
the trial court was correct that the statute of limitations had
lapsed.
       Section 340.6, subdivision (a) provides that “[a]n action
against an attorney for a wrongful act or omission, other than for
actual fraud, arising in the performance of professional services
shall be commenced within one year after the plaintiff discovers,
or through the use of reasonable diligence should have
discovered, the facts constituting the wrongful act or omission.”
In this case, the alleged wrongful act, the failure to withdraw the
settlement offer, must have occurred no later than August 17,
2021, when the trial court entered judgment on the basis of the
settlement. The original complaint by Aguila and TAI was filed
within one year, on August 1, 2022, but the first amended
complaint, which added Rosales as a plaintiff, was not filed until
November 28, 2022.
       Rosales contends her suit was nevertheless timely because
the first amended complaint relates back to the original
complaint. Under the relation-back doctrine, an amended
complaint filed after the statute of limitations expires is deemed
timely if the original complaint was timely and the amended

                                 12
complaint is sufficiently similar to the original. (See Estrada v.
Royalty Carpet Mills, Inc. (2022) 76 Cal.App.5th 685, 714-715.)
In particular, an amendment may relate back to an earlier
complaint if it “substitutes a plaintiff with standing in place of a
plaintiff who lacks standing” (San Diego Gas & Electric Co. v.
Superior Court (2007) 146 Cal.App.4th 1545, 1550), so long as
“the test for relation back is otherwise satisfied.” (Engel, supra,
95 Cal.App.5th at p. 1238, fn. 3; accord, Branick v. Downey
Savings & Loan Assn. (2006) 39 Cal.4th 235, 243-244.)
       The court in Engel summarized the test for relation back in
cases involving the substitution or addition of a new plaintiff. “A
new plaintiff’s claims relate back to claims asserted in a
previously and timely filed complaint if the new plaintiff is
seeking to enforce the same right as a previously named plaintiff
(because, in that case, the amendment relies on the same general
set of facts, involves the same injury, and refers to the same
instrumentality of the defendant’s conduct). [Citation.]” (Engel,
supra, 95 Cal.App.5th at p. 1236.) But “a new plaintiff’s claims
do not relate back if the new plaintiff is seeking to ‘enforce a[ ] . . .
right’ ‘independent’ of the right asserted by the previously named
plaintiff(s). [Citations.]” (Id. at p. 1237.) This occurs when the
new plaintiff alleges a different legal liability or obligation, has
claims based on a distinct injury, or seeks to impose greater
liability than the original plaintiff did. (Ibid.) In essence, we
must determine “whether adding the new plaintiff merely
corrects a ‘ “misnomer in the description of the [plaintiff]” ’ or
instead ‘interject[s] a new party into the litigation for the first
time under the guise of a misnomer.’ [Citations.]” (Id. at
p. 1238.)

                                   13
       Engel, like this case, involved a claim of legal malpractice.
An accountant and the limited liability partnership (the LLP) of
which he was “ ‘the principal’ ” (Engel, supra, 95 Cal.App.5th at
p. 1232) jointly hired a lawyer to sue a client that had not paid a
bill. In the ensuing litigation, only the LLP, not the accountant
personally, was a plaintiff. When the collection litigation proved
unsuccessful, the accountant filed suit in his own name against
the lawyer for professional negligence and related claims. The
original complaint was timely, but two months later, after the
statute of limitations had expired, the accountant filed an
amended complaint adding the LLP as a plaintiff. (Id. at
pp. 1232-1233.)
       The trial court sustained without leave to amend the
attorney’s demurrer, and the Court of Appeal affirmed. The court
concluded that the amended complaint did not relate back to the
original because the lawyer’s “ ‘legal liability or obligation’ to the
LLP is ‘different’ and ‘distinct’ from his ‘legal liability or
obligation’ to Engel.” (Engel, supra, 95 Cal.App.5th at p. 1238.)
Each client “owns its own potential malpractice claims against”
the lawyer, and a suit by one client did not put the lawyer on
notice of potential liability to the other. (Id. at p. 1239.) In other
cases, courts have likewise rejected the application of the
relation-back doctrine where an amended complaint added new
plaintiffs with different rights from the original plaintiff. (E.g.,
San Diego Gas & Electric Co. v. Superior Court, supra, 146
Cal.App.4th at pp. 1550-1553 [addition of new heir in a wrongful
death suit]; Diliberti v. Stage Call Corp. (1992) 4 Cal.App.4th
1468, 1469-1471 [substitution of a plaintiff injured in a car
accident in place of an uninjured passenger].)

                                 14
      By contrast, cases where courts apply the relation-back
doctrine to allow a substitution in the name of the plaintiff
typically involve the assertion of the same claim under a different
name. In other words, these cases indeed involve “correct[ing] a
‘ “misnomer in the description of the [plaintiff].” ’ ” (Engel, supra,
95 Cal.App.5th at p. 1238.) For example, in Jensen v. Royal Pools
(1975) 48 Cal.App.3d 717, where a condominium owner’s
association lacked standing to sue for a negligently built
swimming pool, the relation-back doctrine allowed individual
condominium owners to substitute themselves as plaintiffs. (Id.
at pp. 720-723.) In California Air Resources Bd. v. Hart (1993) 21
Cal.App.4th 289, where a state administrative agency listed itself
rather than the state as plaintiff in a suit against a motorcycle
dealership to enforce pollution laws, it was able to correct the
error after the statute of limitations had expired and proceed
with the case. (Id. at pp. 300-301.) Finally, in Cloud v. Northrop
Grumman Corp. (1998) 67 Cal.App.4th 995, the court held that
the relation-back doctrine allowed a plaintiff to substitute the
trustee in bankruptcy in place of herself as plaintiff. (Id. at
pp. 1008-1011.) In that case, the plaintiff sued her employer for
wrongful termination and sexual harassment after filing for
bankruptcy, but because her suit was based on events that
occurred prior to bankruptcy, the cause of action belonged to the
bankruptcy estate. (Id. at pp. 998-999.)
      Rosales contends that her case is similar to those described
above and distinguishable from Engel because Rosales, as
assignee, “step[ped] into the shoes of Aguila and TAI.” That may
be the case as to the underlying litigation (see California Bank &
Trust v. Piedmont Operating Partnership, L.P. (2013) 218
Cal.App.4th 1322, 1347 [“ ‘ “ ‘The assignee “stands in the shoes”

                                 15
of the assignor, taking his rights and remedies, subject to any
defenses which the obligor has against the assignor prior to
notice of the assignment’ ” ’ ”]), but not as to the alleged legal
malpractice in this case. The assignee does not instantly become
the client of the assignor’s attorney, and, as we noted above, legal
malpractice claims are not assignable. (Engel, supra, 95
Cal.App.5th at p. 1242.) Indeed, the situation in the instant case
appears more fraught with complexity than the joint
representation of the accountant and LLP in Engel. According to
plaintiffs, the defendants agreed to continue representing both
Aguila and Rosales in the litigation against Penn-Star after
Aguila had assigned all his economic interest to Rosales, leaving
defendants with multiple clients with potentially competing
interests.5 Rosales herself soon recognized this situation was
untenable, and obtained separate representation for her motion
to intervene because, as she wrote, “[t]he plaintiffs [that is,
Aguila and TAI] cannot adequately represent . . . Rosales’
interests here.” In these circumstances, the initial complaint
filed by Aguila and TAI would not have put defendants on notice
that they faced potential liability to Rosales, and the relation-
back doctrine does not apply.
       Rosales also alleges that the first amended complaint is
timely under the doctrine of delayed discovery. The one-year
statute of limitations for legal malpractice does not begin running
until “the plaintiff discovers, or through the use of reasonable
diligence should have discovered, the facts constituting the

      5 Plaintiffs imply that Aguila kept some type of
noneconomic interest in the case after the assignment, but they
do not explain what.

                                16
wrongful act or omission.” (§ 340.6, subd. (a).) Plaintiffs contend
they should have been given leave to amend the complaint to
allege “that [Rosales] did not learn of the underlying facts giving
rise to the malpractice claim until February 2, 2022.” On that
date, Rosales purportedly “was informed by [defendants] in a
Zoom call that the federal judge in the underlying action had
actually in fact expressly offered [defendants] the opportunity to
withdraw the [section] 998 offer (despite its purported acceptance
by the Penn-Star) and go to trial, and that [defendants], contrary
to Rosales’ instructions, declined.”
       We are not persuaded. In her motion to intervene in the
underlying litigation, filed September 30, 2021, Rosales stated
that “[o]n August 17, 2021, [the federal district court] issued a
[f]inal [j]udgment . . . in favor of plaintiffs and against defendant
Penn-Star Insurance Company . . . in the amount of $1,995,000
purportedly pursuant to an accepted [section] 998 [o]ffer.” In
doing so, Rosales acknowledged she was aware of the “wrongful
act” that was the basis of her subsequent allegation of
malpractice, i.e., that defendants “failed to follow plaintiffs’
instructions to withdraw an offer to settle and then allowed
judgment to be entered on the accepted offer.” A subsequent
admission by defendants that the district court would have
allowed them to withdraw the settlement offer even after Penn-
Star accepted it6 might have been helpful to plaintiffs in proving

      6 Plaintiffs do not explain under what authority the federal
court could have allowed them to withdraw the offer after its
acceptance, even if the court had been inclined to do so. “General
principles of contract law apply [to section 998 offers] insofar as
‘such principles neither conflict with nor defeat [the statute’s]

                                 17
their case, but it would not have changed the fact that Rosales
was already aware that defendants had failed to follow her
instructions to withdraw the settlement offer.
                         DISPOSITION
     The trial court’s judgment is affirmed. Defendants are
awarded their costs on appeal.
      NOT TO BE PUBLISHED

                                          WEINGART, J.

We concur:

             ROTHSCHILD, P. J.

             CHANEY J.

purpose[ ]’ [citation],” and an unqualified acceptance of such an
offer creates a “binding settlement.” (Siri v. Sutter Home Winery,
Inc. (2022) 82 Cal.App.5th 685, 691.)

                                18