Kurtin v. Elieff
215 Cal. App. 4th 455
| Cal. Ct. App. | 2013Background
- Equal partners in SunCal real estate ventures; 2005 settlement: Elieff buyout Kurtin for $48.8M, with joint Entities on first installment; Arrears defaulted by Joint Entities on later installments; Elieff signed on behalf of himself and Joint Entities, and Agreement secured by Joint Entities’ assets; Arbitration clause amended terms via mediator; Phase 1 accounting found $22.4M distributions, categorized into five purposes; Phase 2 trial produced inconsistent verdicts: liability for 2342/2343 with damages $24,411,433.86 but no misrepresentation liability; Trial court granted new trial for damages and liability under 2343; Appellate court modifies new-trial order to include 2343 liability and damages, affirming judgments on other counts; Mediation privilege and arbitration power are central to resolution; Court ultimately remands for new trial on 2343 damages under 3318.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether arbitration precludes later civil judgment | Kurtin argues arbitration amends terms, precluding further claims | Elieff asserts arbitration fixed liability; may preclude later action | No preclusion; arbitration amended terms but did not bar later claims |
| Impact of mediation privilege on trial fairness | Kurtin relied on mediation evidence to prove ambiguity | Elieff contends privilege denied fair defense | Mediation privilege does not bar enforcement or fair trial under Cassel/Provost; privilege intact |
| Proper measure of damages for 2343 and relation to 3318 | Kurtin seeks full recovery from Joint Entities for 2343 breaches | Damages capped by 3318 to amount that could be recovered from principal | 3318 provides damages measure; 2343 damages limited to recovered/collected from principal; new trial on 2343 damages ordered |
| Remedy for inconsistent verdicts on 2343 liability | Inconsistent verdicts require full resolution of 2343 liability | New trial on damages suffices; 2343 not liable | New trial on liability under 2343 and damages affirmed; modify order to include 2343 |
Key Cases Cited
- O’Malley v. Petroleum Maintenance Co., 48 Cal.2d 107 (1957) (arbitration scope and enforceability principles cited)
- Cassel v. Superior Court, 51 Cal.4th 113 (2011) (mediation privilege protects confidentiality; due process considerations courted)
- Provost v. Regents of University of California, 201 Cal.App.4th 1289 (2011) (mediation privilege apply to settlement-related evidence; due process considerations discussed)
- Shaw v. Hughes Aircraft Co., 83 Cal.App.4th 1336 (2000) (inconsistent verdicts require new trial; tractable remedy described)
- Borton v. Barnes, 48 Cal.App.589 (1920) (section 3318 damages measure in 2343 context; liability framework)
- Kohlberg v. Havens, 41 Cal.App.222 (1919) (early 2342/2343 damages framework and commissions context)
- Moncharsh v. Heily & Blase, 3 Cal.4th 1 (1992) (arbitrator powers limited by submission agreement)