Urs Corp. v. Venture
15 Cal. App. 5th 872
| Cal. Ct. App. 5th | 2017Background
- Construction dispute between contractor (respondent Atkinson/Walsh JV) and subcontractors (appellants URS and AECOM); litigation began March 2017.
- Respondent moved to disqualify appellants' counsel Pepper Hamilton LLP for alleged misuse of confidential/mediation documents; trial court granted disqualification July 31, 2017.
- Appellants immediately appealed the disqualification order and sought a stay; trial court denied an ex parte stay and appellate court issued temporary stay of all proceedings pending briefing.
- Principal legal question: whether an appeal of an order disqualifying counsel automatically stays enforcement of that order under Code Civ. Proc. § 916, and if so, whether the stay extends to all trial court proceedings.
- The appellate court limited its review to legal questions about automatic stay and its scope and declined to resolve whether a discretionary stay of all proceedings under § 923 should issue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an appeal from an order disqualifying counsel automatically stays enforcement of that disqualification | Appeal of disqualification should stay enforcement under § 916 to preserve appellate jurisdiction and avoid mooting the appeal | No automatic stay; arguments analogize to appeals denying disqualification and limit automatic stays to avoid delay abuse | Held: Yes — appeal automatically stays enforcement of the disqualification order pending appeal |
| Whether the automatic stay extends to all trial-court proceedings | Appellants urged stay of all proceedings to avoid prejudice and cost of replacing counsel mid-litigation | Respondent argued ordinary trial proceedings are collateral to disqualification and should proceed to avoid delay | Held: No — automatic stay limited to enforcement of the disqualification order; not all proceedings are stayed (scope may vary if particular proceedings affect the disqualification issue) |
| Whether court should grant a discretionary stay of all proceedings under § 923 | Appellants alternatively sought discretionary stay of entire case | Respondent opposed, citing delay and lack of merit | Held: Denied without prejudice — court declined to decide discretionary stay now and encouraged parties or trial court to address any remaining disputes first |
Key Cases Cited
- Meehan v. Hopps, 45 Cal.2d 213 (Cal. 1955) (establishes appealability of orders granting or denying disqualification as injunction/collateral orders)
- Reed v. Superior Court, 92 Cal.App.4th 448 (Cal. Ct. App. 2001) (appeal from denial of disqualification does not automatically stay trial proceedings)
- Varian Medical Sys., Inc. v. Delfino, 35 Cal.4th 180 (Cal. 2005) (automatic-stay purpose is to preserve appellate jurisdiction by maintaining status quo)
- Kettenhofen v. Superior Court, 55 Cal.2d 189 (Cal. 1961) (distinguishes mandatory and prohibitory injunctions for stay-on-appeal rules)