Yale v. Bowne
9 Cal. App. 5th 649
| Cal. Ct. App. | 2017Background
- Valerie Yale hired attorney Robert Bowne in 2010 to prepare an updated living trust and related deeds; she instructed that her assets remain her separate property.
- Yale and her then-husband Bryan Knight signed trust documents and deeds prepared by Bowne on May 21, 2010; some deeds used the term “community property,” which Yale read but did not question.
- After Knight’s December 2011 domestic violence incident and their separation, Yale consulted another attorney (Larson), removed assets from the trust, sold holdings at Vanguard, and redeposited proceeds into accounts in her name.
- Yale settled her 2012 divorce by paying Knight $260,000 (cash plus assuming a $200,000 HELOC debt); she later sued Bowne for legal malpractice alleging his estate‑planning work caused transmutation of her separate property and consequent losses.
- A jury found Bowne negligent and allocated fault 90% to Bowne and 10% to Yale, awarding $260,000 for the divorce payment, $57,170 for investment losses, and $39,000 for attorneys’ fees.
- On appeal the court affirmed but struck the $57,170 investment-loss award (no substantial evidence of causation) and upheld the comparative-fault instruction; prejudgment interest was denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether jury should receive comparative-fault instruction in legal malpractice case | Yale: comparative fault inappropriate because clients may rely on superior lawyer expertise; client lacked knowledge to spot errors | Bowne: Yale’s conduct (reading deeds, seeing “community property,” and remaining silent) could have contributed; instruction supported | Court: Instruction proper; substantial evidence supported submitting comparative fault to jury under Li framework |
| Whether investment-loss award had substantial evidentiary support | Yale: expert showed $247,737 loss from selling securities then reinvesting later; jury’s reduced award was erroneous | Bowne: Yale chose not to repurchase identical securities in Jan 2012 (could have without cost); her investment decisions—not Bowne—caused any loss | Court: Reversed investment-loss award; no substantial evidence that Bowne caused the loss or that a net loss existed |
| Whether $260,000 divorce‑settlement payment (including $200,000 HELOC assumption) was damages proximately caused by Bowne | Yale: payment was made to avoid risk of losing assets due to alleged transmutation caused by Bowne’s documents | Bowne: HELOC drawdown and debt assumption resulted from Knight’s actions and predated Bowne’s representation | Court: Award for $260,000 sustained; assuming HELOC debt was a proxy for the settlement payment and within damages caused by Bowne’s malpractice |
| Whether prejudgment interest was required | Yale: prejudgment interest mandatory on liquidated claims under Civ. Code § 3287(a) | Bowne: damages were unliquidated/uncertain until jury apportioned comparative fault; trial court’s denial proper | Court: Denial affirmed; amounts were not sufficiently liquidated to mandate prejudgment interest |
Key Cases Cited
- Li v. Yellow Cab Co., 13 Cal.3d 804 (establishing comparative‑fault replacement for contributory negligence)
- LeMons v. Regents of Univ. of California, 21 Cal.3d 869 (comparative‑fault instruction requires evidence of plaintiff’s deficient conduct)
- Theobald v. Byers, 193 Cal.App.2d 147 (distinguishable legal‑malpractice authority regarding specialized knowledge)
- Stein v. Southern Cal. Edison Co., 7 Cal.App.4th 565 (prejudgment interest improper where damages unresolved until verdict)
- Wisper Corp. v. California Commerce Bank, 49 Cal.App.4th 948 (supports denial of prejudgment interest when amount uncertain)