Attorney Journal, San Diego, Volume 131 by Attorney Journals

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Volume 131, 2014 • $6.95

The Case for Statutory Changes in Commercial Real Estate Representation

Jason Hughes & Rob Bello McIntyre’s Civil Alert

Monty A. McIntyre Legal Fee Structures

Margie Smith Six Client Service Standards for Success

Garnett Bandy

RISING STAR: KOOROSH KHASHAYAR

Preventing Problems in the Boardroom, Not the Courtroom

PROFESSIONAL PROFILE: INTER ALIA LAWYERS

Changing the Way Small Firms Find Help for Overflow Work

Attorney of the Month

Tom Monson LAW & GOLF: FROM THE ROUGH TO THE FAIRWAY

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2014 EDITION—NO.131

TABLE OF CONTENTS features 6

PROFESSIONAL PROFILE OF THE MONTH INTER ALIA LAWYERS

Changing the Way Small Firms Find Help for Overflow Work by Karen Gorden

8 Legal Fee Structures

A Unique Opportunity for Growing Personal Wealth and Managing Insecurity

by Margie Smith

10 COMMUNITYnews EXECUTIVE PUBLISHER Brian Topor

ATTORNEY OF THE MONTH

14 Tom Monson

EDITOR Jennifer Appel

Law & Golf: From the Rough to the Fairway

CREATIVE SERVICES Skidmutro Creative Partners

by Jennifer Hadley RISING STAR OF THE MONTH

CIRCULATION Angela Watson PHOTOGRAPHY Chris T. Griffiths Vinit Satyavrata STAFF WRITERS Jennifer Hadley Bridget Brookman Karen Gorden

20 Koorosh Khashayar

by Monty A. McIntyre

WEBMASTER Mariusz Opalka

28 The Case for Statutory Changes in Commercial Real Estate Representation

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by Karen Gorden

Organized Succinct Summaries

25 6 Client Service Standards for Success

SUBMIT AN ARTICLE Editorial@AttorneyJournal.us

Preventing Problems in the Boardroom, Not the Courtroom

22 McIntyre’s Civil Alert

CONTRIBUTING EDITORIALISTS Christopher Walton Monty A. McIntyre Jason Hughes Rob Bello Margie Smith Garnett Bandy

ADVERTISING INQUIRIES info@AttorneyJournal.us

by Garnett Bandy

SB 1171 Seeks To Require Conflict Disclosures for Commercial Real Estate Brokers

by Jason Hughes & Rob Bello

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Attorney Journal San Diego | Volume 131, 7/12/13 2014 55:04 PM

FEATURED PROFESTSHIOENMAOLNPTROFILE OF

2014

Inter Alia Lawyers is Changing the Way Small Firms Find Help For Overflow Work by Karen Gorden

“O

ur attorneys are freelancers by choice-they are not the typical contract attorney who is out of work and looking for a way to make ends meet,” says Kira Rubel, attorney and co-founder of Inter Alia Lawyers. “We are defining what it means to be a freelance attorney, as this is a relatively new concept in the legal community.” Rubel’s partner and co-founder Alanna Whittington continues, “We are on the cutting edge of a new niche in the practice of law, utilizing freelance attorneys as valued members of the legal community. While it is common to hear the term ‘freelance’ used in other professions, until recently most have never heard of the concept of a freelance attorney. We’ve created a new way to practice law that not only provides for a meaningful, fulfilling career, but allows space for other passions and endeavors.”

IDENTIFYING SMALL FIRM NEEDS Of course, were it not for the fact that their business fills a real need in the legal community, the founders of Inter Alia Lawyers would have nothing more than a cool concept instead 6

Attorney Journal San Diego | Volume 131, 2014

of a growing business. Indeed, Rubel and Whittington, who met in 2004 while attending University of San Diego School of Law, first alighted upon the idea of forming a freelance attorney company in 2012. “We are friends from law school and share very similar work ethics and values. We truly enjoy working together. We also share the same passion for achieving a work-life balance. We are attorneys inter alia, which every attorney knows is a Latin phrase to mean ‘among other things.’ That’s why we chose it as the name of our company. We started this business so that we could assist our colleagues in achieving a better work-life balance as well,” says Whittington. Continuing, Rubel says, “We were both practicing attorneys and we saw a clear gap in the legal community in San Diego-there was no place where smaller firms could find immediate assistance from a reliable and experienced freelance attorney, at least not without having to sort through 500 resumes from Craigslist.” Rubel speaks from firsthand experience as the owner of a small firm. “For years I dealt with a constant ebb and flow of work.

YOUR ASSOCIATE WHEN YOU NEED ONE

JOURNAL

Small firms and solo attorneys can manage similar work volume changes by using a freelance attorney, and can avoid having to hire a full-time associate.” As a result, Inter Alia Lawyers was founded in 2013 as a “one-stop shop” where attorneys from all areas of practice can come to find immediate assistance.

FREELANCERS FILL NEED Rubel and Whittington are steadfast and discerning in building a core group of freelance attorneys who can provide consistent, top-notch work product every time. “When an attorney or firm uses an Inter Alia freelance attorney, they do not have to spend valuable time searching for the right person with the proper qualification. We already have the right person for you,” Whittington explains. “We are truly your associate when you need one,” she adds. In particular, Whittington and Rubel look for freelancers who excel in legal research and writing. Inter Alia freelance attorneys come from diverse backgrounds and a wide range of practice areas. However, all freelancers share one common trait. “Every piece of work product that goes out the door is of the level of quality our clients expect. We manage the project from start to finish. After the project is completed by our freelancer, we often edit it an additional time to ensure consistent quality on every single project. We are meticulous about quality control,” Whittington adds. This focus on quality is absolutely imperative to Rubel and Whittington, mandating that Inter Alia Lawyers has a clear understanding of their clients’ needs. To Rubel and Whittington, their relationships with their clients begin with building trust. “We believe in having personal meetings with potential clients to tell them about Inter Alia Lawyers and the services we can provide, rather than blasting emails or inundating a busy attorney with social media updates. The reason for this is simple-attorneys often have a hard time relinquishing control over their cases, so there is an initial hurdle to overcome before they can trust that they will be in good hands when they use our freelance attorneys,” Rubel says. To that end, “We believe in forming personal connections with each of our clients,” Whittington says. “We want to know our clients’ particular needs, and not only provide them with a valuable service, but also become a friend as well. We go out of our way to make sure our clients are not only satisfied, but thrilled with the entire experience of working with Inter Alia Lawyers.” Moreover, Rubel and Whittington hope to enable fellow attorneys the opportunity to become more economically efficient. For attorneys who want to free up their time to take additional cases, that time is made available by utilizing an Inter Alia freelancer. Likewise, attorneys can bill their clients at a profit for time spent on their case by an Inter Alia freelance attorney, or alternatively, can pass on savings to their clients by offering the freelance rate charged by Inter Alia Lawyers. “Greater efficiency and lower rates for their clients are objectives for nearly all solo practitioners and small firms,” says Rubel.

FREELANCE AS THE WAY OF THE FUTURE For Rubel and Whittington, the balance they have been able to achieve through careers as freelance attorneys is something they want every attorney to have the opportunity to experience, should they desire it. “Part of the reason we started our company was so that we could assist other attorneys in achieving a better work-life balance. Our goal is to make our clients’ lives easier on a daily basis. We are frequently thanked because we have enabled our client to take on a new case, or assisted him in keeping a date with his family to go camping for the weekend,” Whittington says. “Our mission is to provide reliable and high quality freelance attorney services to our fellow legal professionals, while promoting our goal of combining a quality law practice with a quality life,” she adds. This mission extends both to their attorney clients and to attorneys looking to become freelancers with Inter Alia Lawyers. “We want to build meaningful and lasting relationships with freelance attorneys throughout the country, training them to perform their work utilizing our core values of combining a quality law practice with a quality life,” Whittington says. Rubel continues, “We provide a space where attorneys can have a meaningful law practice on their own terms, without necessarily having to dedicate their entire lives to a firm. Many of our freelance attorneys are mothers, solo practitioners, yoga instructors and small business owners. We strongly believe that we can be attorneys while simultaneously making time for many other endeavors- both personal and professional.” To date, in addition to the San Diego based office of Inter Alia Lawyers, a second branch has opened in Seattle, Washington and is helmed by Kelly Meilstrup, who is licensed to practice law in California, New York, Colorado and Washington. But Rubel and Whittington have plans for offices nationwide. “We want to open offices in every major city. We want the name Inter Alia Lawyers to be synonymous with five-star freelance attorneys, coast to coast. Ultimately we see ourselves hosting training sessions, writing seminars and holding retreats to aid our fellow freelance attorneys in their practices,” says Rubel. And make no mistake, the founders intend to emphasize balance as Inter Alia Lawyers grows. “We are both avid skiers and serious outdoor enthusiasts, and hope all of our trainings and retreats will include activities like yoga, water sports, and snow skiing, in addition to legal writing, ethics and small business management seminars,” Whittington says. n Contact: Inter Alia Lawyers www.interalialawyers.com info@interalialawyers.com 619-202-7611 555 W. Beech Street San Diego, California 92101

Attorney Journal San Diego | Volume 131, 2014

Legal Fee Structures A Unique Opportunity for Growing Personal Wealth and Managing Insecurity by Margie Smith

Margie Smith is a structured settlement consultant (CA #: 0I11806) with Millennium Settlements. Please contact her with any questions (margie@msettlements.com). Millennium Settlements, Inc., or its agents or affiliates (MSI), do not provide advice or services related to the purchasing of, selling of or investing in securities or other financial instruments. Any discussion of securities contained herein is not intended or written to be used, and cannot be used, as advice related to the purchasing of, selling of or investing in any particular securities or other financial instruments. MSI does not provide legal advice or legal services, nor does MSI provide tax advice or tax services. Any discussion of legal or tax matters contained herein is not intended or written to be used, and cannot be used, as legal advice or for avoiding any penalties that may be imposed under Federal tax laws. To ensure compliance with requirements imposed by the IRS under Circular 230, we inform you that any U.S. federal tax advice contained in this communication (including any attachments), unless otherwise specifically stated, was not intended or written to be used, and cannot be used, for the purpose of (1) avoiding penalties under the Internal Revenue Code or (2) promoting, marketing or recommending to another party any matters addressed herein.

s a plaintiff attorney who does contingency work, you face unique pressures and bear many responsibilities. You have, however, access to a significant tax benefit that nobody else has: the ability to defer an unlimited amount of compensation on your contingency fees and elect to have those funds directed on a pre-tax basis toward an array of fixed income and/or marketbased products. You can choose exactly how and when you wish to receive the resulting income, or “periodic payments” from such a transaction. Many plaintiff attorneys say that it’s incredibly stressful having to make one good settlement sustain them for several years; with attorney fee structures, those stressful days of uneven income could be over. Grossly underutilized by attorneys, fee structures offer two tax distinct advantages: 1) deferment of current earned income and the taxes on that income and 2) deferment of taxation on the interest earnings prior to distribution. Through a legal fee structured settlement you can defer tax liability until the year(s) in which you receive payment, while electing to have those funds directed on a pre-tax basis towards a number of structured settlement vehicles. As eminent tax attorney Robert W. Wood writes, “Stretching out payments over time yields a better tax result….it can mean a lower overall tax burden.” Legal fee structured settlements offer the best of all worlds to contingencybased attorneys. An attorney can spread out tax liability while having the funds managed by an insurance company, trust company or a qualified and appropriately licensed financial services professional, without the limitations imposed by traditional qualified plans, such as an IRA or a 401k plan. You may choose to structure all or a portion of your fees. You are the architect of how you receive these periodic payments and you decide the deferral period. With most qualified plans, you’re subject to penalties for accessing monies before 59 ½ and you have IRS mandated distributions at 70 ½. With a fee structure, you can plan to receive money immediately or much further in the future. You can receive one future lump sum, a series of lump sums, or you can take monthly, semiannually or quarterly payments or any combination. You can receive payments for a defined period of time or, when structuring with an annuity from an insurance carrier, it’s possible to receive a guaranteed stream of payments for life. You can structure as much money as you’d like in any given year—there are very few limitations on how you defer your compensation, so you have a great deal of flexibility as to the timing of your tax liability.

Need More Reasons to Structure Your Fees Instead of Taking Cash? In addition to offering tax-deferred growth, a fee structure allows you to create a personalized financial plan that accounts for your specific needs. You can: l

Save for retirement, your children’s education, or for the years in which you anticipate working less.

1 “Legal Fee Structures Can Hedge the Insecurities Many Lawyers Face.” Los Angeles Daily Journal. 28 August, 2006. P.6

Attorney Journal San Diego | Volume 131, 2014

l l

Ensure solvency and income regularity from year to year. Know that fee structures enjoy enhanced creditor and judgment protection that other investments cannot provide.

When Can You Structure Fees? You can structure your fees… …on any contingency fee case, not only on physical injury/ wrongful death cases. …on single-event claimant cases, mass torts and class action cases. …on verdicts in special situations as well as settlements. ...independently of what your clients, co-counsel, and business partners do with their fees.

What are My Options for Structuring Fees? When you’re weighing your fee structure options, remember that you can use different products for different cases and you can even use different products for the same case if the fee is large enough to warrant doing so. Your options: The Structured Settlement Annuity. The fixed interest rate annuity offers security and peace of mind because you know that you will receive guaranteed fixed income in the customized design of your choosing. This option is unique in that it can provide for guaranteed lifetime payments, and/or increased payments over time to account for inflation. Market-Based Structured Settlement. If you want the potential for a higher rate of return, you should consider directing your pre-tax dollars to a marketbased structure settlement product, such as Millennium’s Fee Structure Plus™. With that product, you can direct your fees towards most any equity or bond vehicle (remember that most qualified plans have a limited line-up of mutual funds), and you have the option of having your own financial planner or a trust company manage your money within a fiduciary capacity. With the assistance of a qualified and licensed financial services professional, you can create a diversified portfolio to meet your individual needs and risk profile. For the attorney who commonly receives his or her fees in cash and then invests in the market, it only makes sense to consider directing those fees, on a pre-tax basis, towards a tax-deferred vehicle such as Fee Structure PlusTM. As with any market-based product, the income stream is not guaranteed or steady, and you incur the same type of risks as you would have with typical investment accounts.

Revenue Service), there are some necessary preemptive steps that you must take to preserve your ability to structure your legal fees. As with all structured settlements, you must secure defense cooperation to structure your fees. The most important point to remember is that if you want to preserve your client’s ability to structure recoveries or your ability to structure fees, you must not let defense write a check to you or to your firm’s trust account. If that happens, you’re considered in constructive receipt of the funds and can no longer enter into a structured settlement. When you have selected a structure plan, it’s at that time that your structured settlement company will request payment and give payment instructions to defense. If the appropriate steps are taken, the IRS should not consider you in possession of the funds until the year(s) in which you receive payment. To ensure that you understand your structured settlement options and how to exercise them, you should consult a structured settlement professional. Don’t wait until “later” to take advantage of this unique opportunity. Remember that the longer you defer payments, the more of an opportunity you have to potentially receive a better rate of return on your fees. It behooves you to plan ahead and to consider how the fee structure options could fit into your overall financial plan. n

Treasury Funded Structured Settlement. U.S. Treasuries have long been the pinnacle of safety and security around the globe. Through a product such as the Treasury Funded Structured Settlement, you can now enjoy the benefit of U.S. Treasuries for your deferred contingency fees. The rate of return is fixed for the life of the periodic payments.

How Do I Make it Happen? While you do have a legal right to structure your contingency fees (see Richard A. Childs, Et al. v. Commissioner of Internal Attorney Journal San Diego | Volume 131, 2014

COMMUNITY news nSeltzer Caplan McMahon Vitek has added Marianne Barth to the firm’s family law practice. Barth has over 20 years of legal experience. Her significant expertise in family law stems from experience as a civil and business litigator where she learned to understand and successfully resolve complex financial and emotional issues typically present in domestic MARIANNE BARTH cases. Barth works collaboratively with clients and adversaries to reach realistic, reasonable and cost effective solutions. Though Barth’s current practice focuses on family law, she also has experience handling other complex litigation matters including business, health care and product liability. Prior to joining Seltzer Caplan, she was a partner at Higgs Fletcher & Mack LLP and also founded her own practice. Barth has served as a settlement judge pro tem in Superior Court, Family Law Division. She received her J.D. from the California Western School of Law and a B.S. from Villa Maria College. nFrederick Schenk, a partner with San Diego-based CaseyGerry has been reappointed by Governor Jerry Brown to serve on the board of directors, 22nd District Agricultural Association (San Diego County Fair Board). Schenk has served on the board since 2011, and was elected president in 2013. His new term will FREDERICK SCHENK expire in January 2018, and he will continue to serve as president until January 2016. The board of directors of the 22nd DAA runs the San Diego County Fair – as well as all operations at the state-owned fairgrounds in Del Mar. Members of the volunteer, ninemember board were appointed by Governor Jerry Brown or by former Governor Arnold Schwarzenegger to four-year terms. Schenk, a longtime San Diego resident, was also vice president of the board of directors, and was appointed previously to serve on the Fair Board by former Governor Gray Davis, serving from 2002 to 2006.

Have a Press Release you would like to submit for our Community News? Email it to PR@AttorneyJournal.us

Attorney Journal San Diego | Volume 131, 2014

nParada Ornelas has joined The Naumann Law Firm, PC as Associate Attorney. Ms. Ornelas specializes in construction defect and civil litigation. She is a member of the State Bar of California and is licensed to practice before all courts in the State of California. Prior to joining The Naumann PARADA ORNELAS Law Firm, Ms. Ornelas worked at a firm in San Diego representing institutional lenders in complex bankruptcy and commercial litigation matters. She is a member of Lawyers Club of San Diego and is currently serving as the Secretary of the Pan Asian Lawyers of San Diego Ms. Ornelas earned a Juris Doctor degree from California Western School of Law, where she was recognized on the Dean’s List and was a recipient of the Lawyers Club’s Janeen Kerper Scholarship. She competed as a member of the Mock Trial Team and served as the Vice President of the Student Bar Association. While in law school, Ms. Ornelas interned at the Civil Division of the U.S. Attorney’s Office and the Office of the U.S. Trustee, Southern District of California. nThe law firm of Balestreri Potocki & Holmes is pleased to announce that Peter B. Nichols and Clayton T. Graham have joined the firm as Associates. Nichols practices in the areas of construction law representing developers, general contractors, property owners and subcontractors in a variety of civil PETER B. NICHOLS litigation and transactional matters. He received his Bachelor of Arts from the University of Massachusetts in 1993, his Masters of Education from the University of Texas in 1997, and his Juris Doctor, cum laude, from the University of Minnesota School of Law in 2011. Graham’s practice focuses on representing owners, developers, CLAYTON T. GRAHAM general contractors, subcontractors, and product manufacturers in a variety of construction prelitigation and litigation matters involving both residential and commercial properties. Graham received his Bachelor of Science, cum laude, from Missouri University of Science & Technology in 2006. He received his Juris Doctor, with distinction, from the University of the Pacific, McGeorge School of Law in 2009.

COMMUNITY news nGomez Trial Attorneys is proud to recognize that the San Diego County Bar Association appointed David Fox to be the Vice-Chair of its Civil Litigation Section. The SDCBA hosts approximately 10,000 members. Fox has a diverse background that includes complex litigation at a large international law firm, trying criminal cases as a federal prosecutor, and now significant trial experience as a personal injury attorney at GTA. Among other things, Fox will be working with SDCBA leadership to help improve professional DAVID FOX development, mentorship, and put together various educational and networking programs to enhance the experience. nEleven attorneys from Duckor Spradling Metzger Wynne have been recognized as San Diego Top Lawyers for 2014. They have each received the highest peer rating – AV Preeminent – through Martindale-Hubbell Peer Review Ratings. DSMW is one of only a few firms where the majority of its attorneys are recognized as Top Lawyers in San Diego. DSMW would like to congratulate the following attorneys for their recognition as a Top Lawyer: Gary J. Spradling, Scott L. Metzger, John C. Wynne, DUCKOR SPRADLING Bernard L. Kleinke, Li-An C. Leonard, K. Jill Osmars, METZGER WYNNE Anna F. Roppo, Michael A. Reed, Bryn C. Spradling, Douglas W. Lytle and James E. Chodzko. Duckor Spradling Metzger & Wynne is a San Diego-based regional law firm founded in 1977. nHiggs Fletcher & Mack announced today that attorney Michael Campbell has joined the firm. Campbell has more than nine years of experience and will join the firm’s Healthcare practice group. Campbell has a strong background in a variety of complex litigation based practices including professional liability, employment law, personal injury, insurance defense, and commercial contract disputes. Campbell attended The College of Law in England, and joins Higgs from the law firm of Hegeler & Anderson in San Diego “Michael brings a variety of expertise and experience to the firm,” said Managing Partner John Morrell. “In addition to having a strong legal background, he possesses MICHAEL CAMPBELL the characteristics of a highly desirable team member that we value so much here at Higgs.” Higgs Fletcher & Mack is proud to bring on its second attorney during its 75-year anniversary celebration. The the firm has pledged to collectively provide 7500 hours of community service in 2014 as well as financial support to local non-profits throughout the year. “It is great to join Higgs at such an exciting time,” said Campbell. “The camaraderie and level of clientele is truly first-rate.”

Attorney Journal San Diego | Volume 131, 2014

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ATTORNEY

OF THE MONTH

LAW & GOLF

2014

F R O M T H E R O U G H T O T H E F A I R W AY

Tom Monson Focuses on Giving Back to San Diego through Golf & Expert Trust, Probate, and ERISA Counsel B Y J E N N I F E R HA D L EY

“ESTATE AND TRUST LITIGATION INVOLVES many personal issues and is like getting a divorce, only worse. Sometimes you’re getting a divorce from your entire family,” says Tom Monson, Senior Partner at Miller, Monson, Peshel, Polacek & Hoshaw. Yet for Monson, who has been with the firm since 1974, the decision to pick a specific practice area and become an expert in it has led to an impressive and award winning 38 year career in trust, probate and ERISA law…with a whole lot of fun and fundraising along the way.

STARTING IN THE ROUGH “My father was a naval aviator for 32 years, flying off of aircraft carriers. He went into the Navy in 1941 during WWII and stayed in until he retired as a Captain in 1973. My mother, after raising four boys, started a career in real estate. Although I wasn’t much of a high school student, my parents always encouraged me and told me I could become anything I wanted.” Monson headed off to college, but wryly recalls that he was “invited into the Army in 1968 after I had dropped out of college to go surfing in Hawaii.” But within 18 months, Monson rose to rank of Sergeant E-5 and was discharged three months early in order to attend college on the G.I. Bill. Once back, he found he had new motivation to study hard in his chosen major of Political Science. “I didn’t like the physical sciences such as biology or chemistry, but I had a firm belief that the rule of law was an honorable way to resolve disputes. I was fortunate enough to go to law school at California Western School of Law on the G.I. Bill as well.” Going into law school, Monson admits he had no idea what area he wanted to practice in. Fortunately, fate intervened. Like most law students, Monson picked up a clerkship during his second year of law school at what was then Miller & Kearny. It 14

Attorney Journal San Diego | Volume 131, 2014

was 1974 when Monson says he “snuck in the back. Another law clerk was ill and they needed a fill-in for one project. I have been with the firm ever since.” That firm had been founded by Ralph Gano Miller, who was one of the first attorneys in California to become a certified tax specialist. “Miller was always known for his rather advanced estate planning techniques for dealing with estate tax issues,” Monson says about his mentor. “We were originally in the San Diego Trust and Savings Bank building, from 1959-1990, then moved to 501 West Broadway and were one of the first tenants in the building,” Monson says. Early in his career, Monson also began building expertise in ERISA law as it evolved. “When it comes to ERISA litigation, many attorneys realize that it is an area of law in which they have no expertise, and it certainly is an area of law in which expertise is required. ERISA was passed in 1974, and I have been involved in ERISA litigation not only as a law clerk in 1974, but as an attorney ever since I began practicing in 1976,” Monson says. “In 1992, I started up and was chairman of the ERISA/Employee Benefits Group for the Association of Trial Lawyers of America. My partner Susan Horner and I have handled numerous ERISA litigation cases, obtaining very favorable benefits for our clients. Several have been published. Susan now does more of the ERISA litigation than I do, but I still keep up to date and consult on numerous ERISA litigation issues.”

TEE IS FOR TRUST Concurrent with building his trust, probate, estate and ERISA practice, Monson was determined to build a reputation that reflected the favorable results he was delivering to clients. “The best advice any attorney can take is to protect your reputation

ÂŠ Photography by Bauman Photographers

at all costs. I try to develop a close relationship with clients and recognize that the area of law that they are dealing with is something new to them. I make sure that I explain the various nuances of the legal system that they are dealing with right up front,” Monson says. “I listen to the clients and let them know I care,” he adds.

Attorney Journal San Diego | Volume 131, 2014

“Unfortunately, when a loved one passes, problems frequently arise concerning their assets. Questions may be raised regarding the validity of their estate plans due to suspicion of undue influence, incapacity, fraud or duress. When it comes to handling will and trust contests and related probate and trust litigation, our firm is dedicated to restoring the client’s peace of mind that their

THE LAW FIRM OF MILLER, MONSON, PESHEL, POLACEK & HOSHAW.

TOM MONSON AND 2012 CHAMPION BRANDT SNEDEKER.

loved one’s true intentions are being preserved,” Monson adds. Moreover, Monson has worked hard to earn a solid reputation amongst his fellow attorneys. “I have always kept my word. I figure others will also keep their word. I don’t send letters confirming that I’m going to do something. I just do what I say I’m going to do,” he says. To that end, Monson’s firm is steadfast about letting other firms and attorneys know that if they refer their client to Miller, Monson, Peshel, Polacek & Hoshaw for estate planning, “We won’t try to get them as our business client. We will never try to steal another firm’s client.” A great deal of the trust that Monson has earned both personally and professionally can be directly attributed to his time spent on the golf course. “Ralph Miller’s way of marketing was fishing trips. He had been the owner of H & M Landing and he would organize yearly fishing trips, inviting bank trust officers, title companies, private fiduciaries, CPAs and other potential referral sources to go out on half-day fishing trips,” Monson says. Taking a cue from Miller’s playbook, Monson decided that instead of fishing, he would combine his passion for giving back to the community with his love for golf and use his time to network and fundraise. He found the perfect opportunity to blend these passions through the Century Club of San Diego. “Golf raises more money for charity than football, basketball and baseball combined,” Monson says. “The PGA Tour is nearing $2 billion raised for charity.” “The Century Club of San Diego is comprised of 60 to 70 businesses and community leaders. It is a non-profit corporation organized for the main purpose of administering and promoting San Diego’s annual PGA Tour event, the Farmers Insurance

TOM MONSON AND JOHN DALY.

Open. The net earnings of the Century Club are used solely for charitable and philanthropic purposes,” Monson explains. “I have been a member since 1995. Being involved with the Century Club has given me continued opportunities to meet and associate with people in San Diego who want to make sure this city truly is America’s Finest City.” But Monson has given much more to the nonprofit than just his membership. In 2012, he served as the President of the Century Club and General Chairman of the Farmers Insurance Open during its 50th anniversary. To date, the Century Club, which was founded in 1961, has raised more than $25 million for local San Diego charities. Monson, with his wife Pam as his caddie, has also played in the Farmers Insurance Open Pro Am each year, giving him the opportunity to play with some of the top golf professionals, including Tiger Woods, Fred Couples, John Daly, Justin Rose, Peter Jacobsen, Tom Lehman and Dustin Johnson. As far as business he’s earned from golf? “Miller said it’s the best thing I ever did,” Monson says. “After 18 holes of golf, you get a good read on a person’s personality. You can see right away if someone is truthful since golf requires that you enforce the rules on yourself. It teaches you a great deal about integrity. Joining the Century Club has allowed me to meet numerous people in San Diego and develop personal relationships of trust. Everyone sooner or later is going to need the help of an attorney regarding estate planning, and unfortunately often, estate litigation issues.” In addition to his work with the Century Club, Monson has also served on various fundraising committees which benefit

Attorney Journal San Diego | Volume 131, 2014

organizations such as the Ronald McDonald House, Pro Kids | The First Tee of San Diego, the Boys and Girls Club of Greater San Diego, the Boy Scouts of America and the Palomar College Foundation. Furthermore, “I was a Committee Chairman during the 2008 USGA US Open at Torrey Pines. I worked every day from 4:30 a.m. to 10:30 p.m. for eight days. It was worth it because it was one of the greatest US Opens ever and it put San Diego in the world-wide spotlight as a place to be,” Monson says.

WILD SHOTS Over the course of a career spanning decades, Monson has had no shortage of interesting cases, particularly as a trust and estates litigator. But to hear him tell it, “When you do estate planning and clients come in, it often turns out that they have other business or personal issues. You become something of the ‘family attorney.’” To that end, he’s found himself in some highly publicized cases, pertaining not only to his areas of specialization, but also to those other areas of civil litigation that he never intentionally sought out. One such example occurred in 1989. “In Ertel v. Dr. Gerald Kersenbock, I had convinced a jury to award my client, Mr. Ertel, $3.4 million against Kersenbrock, the former President of the California Association of Marriage and Family Therapists, for seducing Mr. Ertel’s wife while she was Kersenbrock’s patient. The case made national news as it was one of the largest judgments ever obtained against a therapist for having an affair with a patient where the judgment was in favor of the patient’s spouse,” Monson explains. “It was a unique situation,” he adds. After the program A Current Affair, which was hosted by Maury Povich, covered the story, Monson immediately found himself on the receiving end of dozens of calls seeking his counsel on therapy abuse cases. One of those watching A Current Affair was Stan Love (brother of the Beach Boys’ Mike Love, and former L.A. Laker). “He contacted me after hearing about the Ertel case. I represented Stan Love on behalf of the Beach Boys in filing a petition in Los Angeles Superior Court to have a conservator appointed for Love’s cousin, Beach Boy Brian Wilson. We were successful in that petition in having a conservator appointed and ultimately removed psychologist Dr. Eugene Landy from his control over Brian Wilson. We announced the lawsuit at the Los Angeles Press Club, which was coordinated by the Beach Boys’ publicists. When Brian Wilson and his handlers showed up, I grabbed a copy of the conservatorship papers and personally served Brian. MTV had a video of Brian being served on MTV News that night,” Monson recalls.

LANDING ON THE FAIRWAY Indeed Monson’s career has been a full one, with no shortage of entertainment, awards, recognitions and service to the community. As such, Monson has the sort of unflappable 18

Attorney Journal San Diego | Volume 131, 2014

personality that can only be the earmarks of a career laden with expertise. With 38 years of experience under his belt, there’s not much that he doesn’t take in stride. Yet, he is as passionate about his practice of law and about fundraising through golf as ever. “Our firm is small by design. We generally have 8 or 9 attorneys. We’ve been here since 1959, and I don’t think it is likely that we’re going to go anywhere. I expect our firm to continue right here in this building for many years to come,” he says. “I work hard, and I play hard. I’ve practiced here a long time and I’m proud to say that many attorneys that I have gone against in the past have contacted me to represent them or their clients years later. I enjoy the practice of law, and I know I have another five to ten years left in me,” he adds. n

Contact: Tom Monson Miller, Monson, Peshel, Polacek, & Hoshaw www.estate-plan.com 619-239-7777 TomMonson@erisa-law.com 501 West Broadway, Suite 700 San Diego, CA 92101

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IN THE BOARDROOM, NOT THE COURTROOM JOURNAL

FEATURED RISING STAR

OF THE MONTH

2014

Koorosh Khashayar, Founder of LOKK Legal Devotes His Practice to Preventing Problems, and Protecting Clients Before it is Too Late. by Karen Gorden

“My typical clients are investors, lessees, purchasers or sellers of a business or commercial property. They are typically those who are starting a business and need to incorporate or those who own medium sized businesses and need the counsel of an experienced real estate and transactional attorney,” says Koorosh Khashayar, founder of LOKK Legal. “I have drafted, revised and negotiated many, many contracts.” As a previous investor himself, Khashayar has firsthand experience in what can happen when investors and business owners do not take the proper measures to protect what they’ve worked for by planning ahead. In fact, experiencing the painful consequences of not protecting his assets firsthand propelled him to make transactional real estate and business law his career.

The Value Of Hard Work, The Cost Of Being Unprotected “My family is in real estate. My grandfather was a very successful real estate developer, and my uncle has been in real estate and business for more than 30 years,” says Khashayar. It only made sense then for Khashayar to put his own money earned while in college into real estate. “While in college, I was selling cell phones part time, for commission, while I was in college, and had purchased a car with my money. One day I had a talk with my great uncle and he told me that instead of pouring thousands of dollars upgrading a car that is only going to depreciate, I should be investing my money into real estate. I thought what he said made sense so I sold my car, partnered with my brother and a friend and we all bought a condo in San Francisco’s Financial District in 2001, when I was 18,” he recalls. Over the next few years, Khashayar turned that single investment into 8 real estate properties, and he seemed poised to follow in the family business of real estate investment. However, he was reluctant to put all of his eggs in the proverbial basket of real estate investment. “I didn’t want to gamble entirely on investments. I wanted to gamble on my education,” he says. To that end, Khashayar earned his J.D. by the time he was 24, and immediately followed it up by obtaining his post doctorate L.L.M from the University of Miami School of Law in Real 20

Attorney Journal San Diego | Volume 131, 2014

Property Development. He then dove headfirst into working for some of the largest real property transactional firms in the country, before returning to California. Once he returned to America’s Finest City, he secured a position as Assistant City Attorney in San Diego, representing such clients as Centre City Development Corporation, Southeastern Economic Development Corporation and the Redevelopment Company of San Diego. While he loved the work, Khashayar decided to gain a bit of litigation experience, just to make sure he was a well-rounded attorney. In the process he confirmed what he had long suspected was his true calling. He wanted to use his brain to protect others. “It is not my personality to fight over a dispute after the fact. I prefer to prevent problems before they occur,” he says. A personal experience would solidify this passion even further.

Protecting Others as a Passion and a Profession Khashayar’s real estate investments had given him a net worth of a few million dollars before he even turned 25. But he says, “I didn’t have any protection. I wasn’t set up to succeed. I didn’t have operating agreements in place, I didn’t create any entities for my investments, I didn’t properly protect myself within my investments. I didn’t even read or review any of the promissory notes or leases I signed while I was in college or law school. When the real estate market went down, I basically lost it all.” However, what he lost in financial investments, he gained in the knowledge, life experience and ability to be able to truly understand the value of having properly crafted and highly specialized documents protecting his assets. In short, it provided him with an ability to assist his clients in a way others couldn’t. “I have been in my clients’ shoes. I have worked hard to build up a future for myself, and I have seen it almost destroyed because I wasn’t properly protected. Now I use that experience to make sure that I can protect others from that type of loss. It is incredibly rewarding to help protect others, so they don’t have to lose what they have worked for,” he says. To that end, Khashayar launched LOKK Legal (Law Offices of Koorosh Khashayar) in order to provide highly specialized and

secure transactional services. “I am not a general practitioner. I refer anything that is not business or real estate transactional work out to others attorneys. I use my experience in drafting highly specialized and strictly customized contracts for clients,” he says. “Many clients and some attorneys believe that a one-size-fits all contract or form will suffice. They won’t. The devil is in the details, and if you miss one detail, it can cost your client. I don’t use ready-forms or templates. A client who owns a grocery store needs a different contract to truly protect them than a mechanic requires. LOKK Legal does not cut and paste generic documents to save time. Every single client receives a unique, customized document. We are adamant about quality control. A good transactional attorney is obligated to protect their client by being attentive to detail, and the level of detail that goes into our work is extremely painstaking,” Khashayar explains. Not surprisingly, because of his highly specialized field of practice, and his extensive experience in drafting contracts and agreements, a great deal of Khashayar’s business results from referrals. “Attorneys send their clients to me, because they know that the quality of work they will receive will make the attorney look good. They are appreciative of the lengths we go to in order to protect their clients,” Khashayar explains. One look at LOKK Legal’s nearly 40 positive reviews on Yelp! and more than 20 on Google+ serve as testament that Khashayar’s clients –including referring attorneys- are incredibly pleased with LOKK Legal’s work. Additional efforts on Khashayar’s part to be able to help protect as many clients as he can, may be seen in the flexible billing he offers. “Our low overhead allows us to offer value

pricing while keeping quality high. Firms with high overhead and large rents are going to have to charge accordingly to cover those expenses. We make a concerted effort to keep our overhead low, so the savings are passed onto clients,” he says. Moreover, the boutique style of LOKK legal allows for a great deal of nimbleness in billing. In addition to utilizing the latest technology, so that clients may provide E-signatures, or pay fees online from home or even from their cell phones, “We offer flat fees for businesses or hourly billing to ensure that everyone –no matter how large or small their business or investment- may be able to protect themselves,” Khashayar says. “I believe that the creativity, ingenuity, and the hard work ethic of the entrepreneur and small business owner are the backbone of the American Dream. I’ve seen how the costs, damages, and unnecessary legal liability from legal disputes can cripple such a dream. Proper legal planning can prevent such pitfalls, and it is an honor to be able to help entrepreneurs and business owners protect everything they have worked for and are continuing to work towards.” n

Contact: Koorosh Khashayar LOKK Legal www.lokklegal.com koorosh@lokklegal.com (858) 472-9700 330 A Street #13 San Diego, California 92101 Attorney Journal San Diego | Volume 131, 2014

McIntyre’s Civil Alert Organized Succinct Summaries by Monty A. McIntyre, Esq. Monty A. McIntyre, is a Relentless Optimist® who serves as a mediator, arbitrator and referee with ADR Services, Inc. As a mediator his mission is to bring peace into the lives of people by excellently helping them resolve disputes. As an arbitrator and referee his mission is to help parties obtain Reasonable, Rapid Resolution™ of their disputes. Mr. McIntyre is the 2014 President of the San Diego Chapter of the American Board of Trial Advocates (ABOTA). He was the 2002 President of the San Diego County Bar Association. He has extensive experience representing both plaintiffs and defendants in business, insurance bad faith and tort litigation. He is a Master in the Enright Inn of Court, and a multiple CASD Outstanding Trial Lawyer award recipient. To schedule contact Genevieve Kenizwald at ADR Services, Inc. by phone (619) 233-1323 or email gen@adrservices.org.

U.S. SUPREME COURT No cases

9th CIRCRUIT COURT OF APPEAL

collection of personal ZIP code information in kiosk rental transactions fell outside the reach of California Civil Code section 1747.08(a) of the California Song-Beverly Credit Card Act because the customer’s credit card was used as a deposit to secure payment in the event of loss or late return, and the transaction was therefore exempt under section 1747.08(c)(1). (June 6, 2014.)

Americans With Disabilities Act Cohen v. City of Culver City _ F.3d _ (9th Cir. 2014), 2014 WL 2535329: The Court of Appeals reversed in part the district court’s summary judgment for defendants. The Court of Appeals concluded that a genuine dispute of material fact existed as to whether the City denied plaintiff access to the sidewalk by reason of his disability by allowing a vendor’s display to completely block the curb ramp, impeding disabled access to the public sidewalk, and by failing to post signs identifying alternative disabled access routes. (June 6, 2014.)

Class Actions Laguna v. Coverall North America Inc. _ F.3d _ (9th Cir. 2014): The Court of Appeals affirmed the district court’s approval of a settlement agreement reached before class certification. The district court properly concluded that the settlement, including an award of attorney fees of $994,800, was fair, reasonable, and adequate. (June 3, 2014.))

Consumer Protection Sinibaldi v. Redbox Automated Retail, LLC _ F.3d _ (9th Cir. 2014), 2014 WL 2535471: The Court of Appeals affirmed the district court’s dismissal under Rule 12(b)(6). Redbox’s

Attorney Journal San Diego | Volume 131, 2014

CALIFORNIA SUPREME COURT Evidence People v. Goldsmith (2014) _ Cal.4th _ , 2014 WL 2519: The California Supreme Court affirmed the rulings of the Court of Appeal and the trial court regarding the admissibility of automated traffic enforcement system (ATES) evidence. The trial court did not abuse its discretion in ruling that the police investigator’s testimony provided sufficient authentication to admit the ATES evidence and that the ATES evidence was not hearsay. (June 5, 2014.)

CALIFORNIA COURTS OF APPEAL Attorney Fees Syers Properties III, Inc v. Rankin (2014) _ Cal.App.4th _ , 2014 WL 1761923: The Court of Appeal affirmed the trial court’s award of $843,245.27 in attorney fees to prevailing defendants

under Civil Code section 1717 and Code of Civil Procedure section 1033.5. The trial court did not abuse its discretion in accepting defense counsel’s computation of attorney hours as hours reasonably spent working on the case. Nor did the trial court abuse its discretion in making the rate determination. The rate determination was supported not only by the adjusted Laffey Matrix, but also by Attorney Finney, an attorney with more than 20 years experience in civil litigation of this type, who stated under penalty of perjury his opinion as to the prevailing rate in the San Francisco Bay Area for the services performed by the attorneys and paralegals in the case at rates virtually identical to those calculated in the Laffey Matrix as adjusted for the San Francisco-San Jose-Oakland Region. (C.A. 1st, filed May 5, 2014, published May 27, 2014.)

Civil Procedure (anti-SLAPP) California Public Employees Retirement System v. Moodys Invest (2014) _ Cal.App.4th _ , 2014 WL 2186539: The Court of Appeal affirmed the trial court’s denial of an anti-SLAPP motion. The trial court properly concluded that, although CalPERS’ complaint was based upon conduct by the rating agency defendants that fell within the scope of the anti-SLAPP statute, early dismissal would be improper because CalPERS had successfully demonstrated a probability of prevailing on the merits of its sole claim of negligent misrepresentation. (C.A. 1st, May 23, 2014.) City of Montebello v. Vasquez (2014) _ Cal.App.4th _ , 2014 WL 2424914: The Court of Appeal affirmed the trial court’s denial of an anti-SLAPP motion because defendants failed to demonstrate that their conduct constituted protected activity. The City sued city council members and a city official for violations of Government Code section 1090, which prohibits city officers and employees from having a financial interest in any contract made by them in their official capacity. Defendants claimed their votes were protected activity. The Court of Appeal disagreed, observing that an elected representative’s vote and acts of governance mandated by law, without more, are not exercises of free speech or petition. (C.A. 2nd, filed April 30, 2014, published May 30, 2014.) Graham v. Bank of America (2014) _ Cal.App.4th _ , 2014 WL 2149725: The Court of Appeal affirmed the trial court’s order sustaining a demurrer without leave to amend to the second amended complaint. Plaintiff alleged that defendants made fraudulent misrepresentations or omissions by stating the appraised fair market value of his home in 2004 was “increasing” and the loan was “good” for him while allegedly knowing the appraisal was “outrageously speculative.” Plaintiff sought to hold the defendants responsible for the decline in his

property value as well as the collapse of the real estate market. Plaintiff’s allegations failed to state causes of action for fraud and deceit, violations of Business and Professions Code section 17200, and declaratory relief. (C.A. 4th, May 23, 2014.) Piccinini v. California Emergency Management Agency (2014) _ Cal.App.4th _ , 2014 WL 2443867: The Court of Appeal affirmed in part and reversed in part the trial court’s order sustaining a demurrer, without leave to amend, to plaintiff’s first amended complaint. Plaintiff was offered and accepted employment as a deputy chief in the California Emergency Management Agency. The Friday night before he was to report for work, he was told not to come because the position for which he was hired had been eliminated. The trial court properly sustained the demurrer to the breach of contract and wrongful termination causes of action. However, the trial court erred in sustaining the demurrer to the promissory estoppel cause of action because plaintiff alleged a claim for estoppel within the scope of Government Code 19257. (C.A. 1st, May 27, 2014.) Staniforth v. The Judges’ Retirement System (Chiang) (2014) _ Cal.App.4th _ , 2014 WL 2212515: The Court of Appeal affirmed the trial court’s order sustaining a demurrer, but reversed its order denying a subsequent motion to partially vacate that order. The trial court properly sustained the demurrer by defendant to plaintiffs’ claim they had been underpaid because they had not been given proper cost of living adjustments. But the trial court erred in denying the motion to partially vacate the order sustaining the demurrer on the basis that, under the case law as interpreted by the JRS and adopted by the trial court, their action had asserted viable claims on behalf of 10 class members who were allegedly not paid the amounts due to them under case law as interpreted by the trial court. (C.A. 4th, filed May 19, 2014, published May 29, 2014.)

Corporations (contractors) E. J. Franks Construction, Inc. v. Sahota (2014) _ Cal.App.4th _ : The Court of Appeal affirmed the trial court’s ruling the plaintiff corporation could sue for quantum meruit for work performed. Mr. Franks became a licensed general building contractor in 1995 and operated a sole proprietorship for years. During the course of constructing a home for defendants, Mr. Franks incorporated his company under the name E. J. Franks Construction, Inc. (EJFCI) and on April 12, 2005, his contractor’s license was reissued to the corporation. The trial court properly rejected defendants’ claim that EJFCI was prohibited by Business and Professions Code section 7031 from pursuing quantum meruit damages because it was an unlicensed contractor at the time the construction contract was entered

Attorney Journal San Diego | Volume 131, 2014

into. Section 7031 did not apply to the unique situation in this case because to do so would not advance the statute’s goal of precluding unlicensed contractors from maintaining actions for compensation. (C.A. 5th, June 5, 2014.)

Disenhouse v. Peevey (2014) _ Cal.App.4th _ : The Court of Appeal affirmed the trial court’s ruling that it lacked jurisdiction. Plaintiff filed a motion for an injunction in the trial court to stop members of the PUC from meeting because they would not allow her to attend. The trial court properly ruled it lacked jurisdiction because Public Utilities Code section 1759 deprives the superior courts of jurisdiction “to enjoin, restrain, or interfere with” the Public Utilities Commission (Commission) in the performance of its official duties. Although Government Code section 11130 authorizes any interested person to “commence an action by mandamus, injunction, or declaratory relief for the purpose of stopping or preventing violations or threatened violations” of the state’s open meeting law, a person desiring to commence such an action against the Commission may only do so by filing a petition for writ of mandate in the Supreme Court or the Court of Appeal. (C.A. 4th, June 3, 2014.)

(AT&T California) (2014) _ Cal.App.4th _ , 2014 WL 2306654: The Court of Appeal affirmed the trial court’s judgment for defendants on a writ petition. Defendants approved a project by AT&T California to install 726 metal utility boxes housing telecommunications equipment on San Francisco sidewalks in order to expand its fiber-optic network. Plaintiff’s writ petition challenged the approval claiming it violated the California Environmental Quality Act (CEQA). The trial court properly denied the writ petition because the project fell within a categorical exemption under CEQA. (C.A. 1st, filed April 30, 2014, published May 30, 2014.) Sierra Club v. County of Fresno (Friant Ranch, L.P.) (2014) _ Cal.App.4th _ , 2014 WL 2199317: The Court of Appeal reversed the trial court’s judgment for defendants on a writ petition. The writ petition challenged the approval of the Friant Ranch project, a proposed master-planned community for persons age 55 or older located in north-central Fresno County (the Project), located on 942 acres of unirrigated grazing land adjacent to the unincorporated community of Friant, below Friant Dam and Millerton Lake, near the San Joaquin River. The Court of Appeal found the Project was consistent with land use and traffic policies, and found no problem with the adequacy of the Environmental Impact Report (EIR) regarding wastewater disposal. The Court of Appeal, however, concluded the EIR was inadequate in addressing air quality impacts, and a revised EIR was required. (C.A. 5th, May 27, 2014.)

Medical Board of California

Torts

Employment Piccinini v. California Emergency Management Agency (2014) _ Cal.App.4th _ , 2014 WL 2443867: See summary above under Civil Procedure.

Government

Lewis v. Superior Court (Medical Board of California) (2014) _ Cal.App.4th _ , 2014 WL 2212122: The Court of Appeal affirmed the trial court’s denial of a writ petition. Dr. Lewis filed a writ petition claiming the Medical Board of California violated his patients’ informational privacy rights in their controlled substances prescription records when the Board obtained data from the Controlled Substance Utilization Review and Evaluation System (CURES, see Health & Safety Code section 11165) during a disciplinary investigation of Dr. Lewis. The Court of Appeal concluded the CURES statute does not amount to an impermissible invasion of the state constitutional right to privacy of patients, because there are sufficient safeguards to prevent unwarranted public disclosure and unauthorized access to CURES data. (C.A. 2nd, May 29, 2014.)

Real Property Graham v. Bank of America (2014) _ Cal.App.4th _ , 2014 WL 2149725: See summary above under Civil Procedure. San Francisco Beautiful v. City and County of San Francisco

Attorney Journal San Diego | Volume 131, 2014

Haver v. BNSF Railway Co. (2014) _ Cal.App.4th _ , 2014 WL 2466570: The Court of Appeal affirmed the trial court’s order sustaining a demurrer without leave to amend. The trial court properly relied on the holding in Campbell v. Ford Motor Co. (2012) 206 Cal.App.4th 15 when it sustained a demurrer without leave to amend in a wrongful death action based on premises liability brought by the survivors of a woman who died of mesothelioma as a result of exposure to asbestos from her husband’s work clothes. (C.A. 2nd, June 3, 2014.) n

See U.S. Supreme Court opinions at: http://www. supremecourt.gov/opinions/opinions.aspx See 9th Cir. opinions at: http://www.ca9.uscourts.gov/opinions/ See Ca. opinions at: http://www.courts.ca.gov/opinions.htm

Client Service Standards for Success What is a service provider to do in order to attract the necessary client base to fuel a business? The provider must instigate a shift in mind-set from “you need me and my services” to “I need you and your continued business.” By Garnett Bandy

IT IS A CULTURAL SHIFT that can seem quite daunting for a law firm typically focused more on billings and results. Consider, however, what keeps bringing you back to that restaurant or coffee chain that charges you slightly more than a competitor but makes you feel like the most important client there. It is often the employees who treat you with respect, ushering up such phrases as “my pleasure,” or “can I refill that for you?” You might have a good client base without an emphasis on superior client service, but you will not sustain it or get many referrals without adapting. Improving customer satisfaction will help you increase revenue, reduce churn, improve client retention and create more referrals.

HERE ARE SIX CLIENT SERVICE STANDARDS THAT CAN BE YOUR KEY TO A SUCCESSFUL FUTURE. 1. DIFFERENTIATE YOURSELF Go beyond “best price” and offer true value for working together. Become the professional and trusted advisor that clients can rely on. Take pride in your firm’s commitment to client satisfaction; make yourself available and consistently communicate with clients. Consider client service training for all of your staff, including lawyers. Make your commitment to clients known through visual reminders such as plaques or a strong mission statement, and share both in-house and externally that this mission is what your firm is all about.

2. INQUIRE, TRACK AND MEASURE Studies have shown that a satisfied client will tell a maximum of two people about great service; however, a dissatisfied client will tell a minimum of 11 people about bad service. To make matters worse, technology has increased these statistics with the ability to comment via email or by posting on blogs and

social media. Still, a client does not have to say anything to be dissatisfied. As the saying goes, “what is measured is managed,” so ask clients to rate the service they have received and use that information as feedback for your staff. Fix the problem areas as quickly as possible. Continuously remind your teams of the long-term goal of achieving superior customer service.

3. MONITOR SERVICE ISSUES AND EXPECTATIONS Sometimes neither client service nor communication comes naturally to legal IT or attorneys; yet, if they want to survive and thrive, they have to be able to do both. Continuous reiteration by management and ongoing training can help transform the typical law firm culture into a service culture. Conduct quarterly check-ins with your team regarding service issues and their ability to meet client expectations.

4. TALK LESS, LISTEN MORE Clients often say the quality they appreciate most in a legal professional is that he or she “understands my business” and “listens.” By the same token, the number one complaint clients have about their contacts at a firm is a perceived lack of communication or responsiveness and a feeling of being out of the loop. Communicate often and remember that clients are both internal and external. Translation: All co-workers should be treated with the same respect and courtesy as a client, regardless of position or pay grade.

5. ENCOURAGE TEAMWORK Each service provided should be understood by everyone across the board. A “not my job” attitude is detrimental to exceptional client service. Though each employee does not need to be an expert in every area, training on how to handle inquiries and how to redirect the client to the person best able to address his or her need is imperative. Rather than allowing people to point to someone

Attorney Journal San Diego | Volume 131, 2014

down the hall or transfer a call with no introduction, ask each team member to apply a little personal service and try, at every point of contact, to make sure clients are in touch with the right person. This kind of customer service is remembered and appreciated.

6. REGAIN THE LOST ART OF HUMAN RELATIONS In this era of texting, Facebook and other social media platforms, fewer and fewer verbal conversations take place. Phones should be answered promptly, professionally, consistently and with the proper tone. When a call is answered, the focus should be on four basic steps: greet- ing the client, identifying the firm, identifying whom the caller is seeking and presenting an offer of service. Repeating the other person’s name before the call is over reinforces a connection. Encourage face-to-face meetings as much as possible, and remember that each contact is a reflection of the firm’s culture. Continuously remind your teams to represent your firm well. Handle with Care Even if you employ these tactics, you cannot get customer service 100 percent right 100 percent of the time. What happens when problems occur? Research shows that customers whose complaints are satisfied will actually use more of your

services than they did before the deficient service incident. Be sure your team has a system or protocol for handling unhappy clients, and take complaints seriously. Of course, you cannot offer a free dessert as restaurants do or an upgrade to first class as you find with airlines, but you can ask questions to make sure you understand exactly what happened and what the client expects in return. Doing your best to recover from the mistake is important to the success of your firm. Correcting mistakes and focusing on the six service principles outlined will differentiate you and your firm and ensure that your client views you as a necessity, and not just an amenity. n _____________________________________________________ Garnett Bandy is a 20-year veteran of the legal facilities management and outsourcing industries. For the past 13 years, he has served as a director in both sales and operations for Document Technologies Inc. (DTI). For the past three years, Garnett has served as the National Director of Best Practices and travels across the country speaking on client service and providing leadership training for DTI’s 2,500+ employees. Contact him at gbandy@ dtiglobal.com. This article was first published in ILTA’s March 2014 issue of Peer to Peer titled “Client Satisfaction: Customer Service Is Job One!” and is reprinted here with permission. For more information about ILTA, visit www.iltanet.org.

Areas of Expertise Business/Commercial • Class Action Complex Litigation • Construction Employment/Wage and Hour Insurance Coverage/Bad Faith • Intellectual Property Legal Malpractice • Medical Malpractice Personal Injury • Probate Real Property/CEQA/Land Use • Wrongful Death

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Attorney Journal San Diego | Volume 131, 2014

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Attorney Journal San Diego | Volume 131, 2014

The Case for Statutory Changes in Commercial Real Estate Representation SB 1171 Seeks To Require Conflict Disclosures for Commercial Real Estate Brokers by Jason Hughes & Rob Bello

Jason Hughes is President & CEO of Hughes Marino, a Southern California commercial real estate company specializing in tenant representation for lease and building purchases. Contact Jason direct at (619) 238-2111 or jason@hughesmarino.com to learn more. Robert Bello is General Counsel for Hughes Marino, a Southern California commercial real estate company specializing in tenant representation and building purchases. Contact Robert direct at (619) 238-2111 or rob@hughesmarino.com to learn more.

Attorney Journal San Diego | Volume 131, 2014

henever there is a conflict of interest, there exists an opportunity for those seeking representation to be exploited. This is undeniably true for commercial real estate buyers and tenants. Current commercial real estate law prescribes fiduciary duties upon brokers, but at the same time permits dual agency. Dual agency occurs when one broker represents both landlord and tenant (or seller and buyer) in the same transaction. In fact, the law is specific regarding a dual agent’s responsibility to not share any inside information between the parties. The dual agent is essentially limited to acting as a go-between, simply moving information back and forth between the two sides. While the law governing residential real estate transactions requires written disclosure of the dual agent relationship, a description of the duties owed by the agent, and signed, written consent from the client for the dual agent to represent the client, current commercial real estate law does not require such disclosures. As we will further detail, these current shortcomings in the law have driven Hughes Marino to propose and support SB 1171. Extending these residential real estate protections to commercial transactions (which SB 1171 proposes) will close this ethical loophole and increase transparency in commercial real estate deals and brokerclient relationships.

DUAL AGENCY AND LOYALTY Dual agency inherently creates a conflict of interest in the typical commercial real estate transaction because the broker’s loyalty is divided between the two sides. In fact, despite the practice being permitted by law, commercial real estate brokers cannot truly uphold their fiduciary duties when acting as a dual agent, as explained by California courts. “[A] broker’s fiduciary duty to his client requires the highest good faith and undivided service and loyalty. The broker as a fiduciary has a duty to learn the material facts that may affect

the principal’s decision. He is hired for his professional knowledge and skill; he is expected to perform the necessary research and investigation in order to know those important matters that will affect the principal’s decision, and he has a duty to counsel and advise the principal regarding the propriety and ramifications of the decision. The agent’s duty to disclose material information to the principal includes the duty to disclose reasonably obtainable material information.” (Assilzadeh v. California Federal Bank (2000) 82 Cal.App.4th 399, 414-415, quoting Field v. Century 21 Klowden-Forness Realty (1998) 63 Cal.App.4th 18, 25-26.) Additionally, “[a] fiduciary must tell its principal of all information it possesses that is material to the principal’s interests. A fiduciary’s failure to share material information with the principal is constructive fraud, a term of art obviating actual fraudulent intent.” (Michel v. Palos Verdes Network Group, Inc. (2007) 156 Cal.App.4th 756, 762.) “`Constructive fraud is a unique species of fraud applicable only to a fiduciary or confidential relationship.’ Most acts by an agent in breach of his fiduciary duties constitute constructive fraud. The failure of the fiduciary to disclose a material fact to his principal, which might affect the fiduciary’s motives or the principal’s decision, which is known (or should be known) to the fiduciary, may constitute constructive fraud. Also, a careless misstatement may constitute constructive fraud even though there is no fraudulent intent.” (Salahutdin v. Valley of California, Inc. (1994) 24 Cal.App.4th 555, 562.) One of the inherent issues caused by such dual representation is actually addressed in the current statutes governing residential real estate transactions: a dual agent cannot tell the buyer that the seller would take less and cannot tell the seller the buyer would pay more unless that agent receives written consent from each side first. (Civil Code, § 2079.21.) Yet this is the very information that causes a client to hire a broker in the first place. Due to the clear conflict of interest, it is not only reasonable but imperative that a commercial real estate broker be required to disclose his representation of both parties, to both parties. Consider Glenn v. Rice (1917) 174 Cal. 269, a case involving the sale of land from the land owner to the San Diego Construction Company where only one party knew that the broker was being paid by both sides. Key holdings include: l

If an agent is engaged by both parties to effect a sale of property from one to the other, or an exchange between them, not as a mere middleman to bring them together,

but actively in inducing each to make the trade, he cannot recover compensation from either party, unless both parties knew of the double agency at the time of the transaction. l

The reason for the rule is that he thereby puts himself in a position where his duty to one conflicts with his duty to the other, where his own interests tempt him to be unfaithful to both principals, a position which is against sound public policy and good morals.

Finally, another problem with dual agency is that, given the relationship and the extensive time spent working together, the seller/landlord usually has a much closer relationship with the dual agent – and the dual agent is privy to the seller’s motives, thoughts and agenda. This gives the seller or landlord yet another advantage in the transaction.

WHY COMMERCIAL REAL ESTATE HAS BEEN EXCLUDED The reason that commercial real estate brokers have been exempt from these written disclosure requirements stems from the holding in Easton v. Strassburger (1984) 152 Cal. App.3d 90. In that case, the Appellate Court held real estate licensees owed certain fiduciary duties to buyers even while representing the sellers in a residential home transaction. In the Easton case, the Appellate Court withheld judgment relating to commercial transactions, stating in dictum: “[u] nlike the residential home buyer who is often unrepresented by a broker, or is effectively unrepresented because of the problems of dual agency ..., a purchaser of commercial real estate is likely to be more experienced and sophisticated in his dealings in real estate and is usually represented by an agent who represents only the buyer’s interests ....” (Id. at p. 102, fn. 8.) The Court provided absolutely no basis for this conclusion however. How did those three justices determine that commercial real estate tenants or buyers were automatically sophisticated? Later the next year, the Legislature then refined and codified this holding with the initial statutes that make up this portion of the Civil Code. In fact, when compared to landlords, most commercial tenants do not have anywhere close to the same experience and sophistication since a tenant will likely negotiate a lease once every five years, while the landlord negotiates multiple leases every year with the help of a team of sophisticated professionals.

Attorney Journal San Diego | Volume 131, 2014

SB 1171: ARGUMENT FOR DEMANDING TRANSPARENCY IN COMMERCIAL REAL ESTATE LAW The fact that commercial real estate brokers are not required to disclose in writing their dual agent status is just plain wrong. It would be like saying that an attorney should be able to represent the defendant and the plaintiff without providing and obtaining informed, written consent. Except that in this case, the defendant and the attorney have a long and prosperous relationship – essentially putting the plaintiff in a subordinate position with his or her own attorney. This begs the question: Shouldn’t your commercial real estate broker have undivided loyalty too? Shouldn’t the same basic ethical requirements that apply to residential brokers and attorneys also apply to commercial real estate brokers? Currently, commercial dual agents merely have to provide oral disclosure (which is almost impossible to enforce since any dispute quickly devolves into a he said/she said swearing contest). Existing law requires residential real estate listing and selling agents or brokers to provide parties to a transaction with a real estate agency relationship disclosure form. This should apply to commercial brokers too. The financial loss a company (or law firm) may experience by working with a dual agent can be substantial. Why should your commercial real estate broker be held to any less of a standard than a residential broker? This is why we proposed and support SB 1171. This bill calls for greater transparency in commercial real estate transactions by requiring brokers to provide written disclosure as to who they represent – the landlord, tenant, or both. It also requires brokers acting as dual agents to obtain written consent from their clients. But truth be told, it should really go much further than simple disclosure. Given the substantial economic commitments companies make based on the advice of their real estate broker, it makes sense that a broker’s advice should be 100% un-conflicted. This simple concept acts as the foundation for all of our services at Hughes Marino, and is why we only serve tenants and buyers in commercial real estate transactions. This Appellate Court said it well: “Common sense and ancient wisdom join the law in teaching that an agent is not permitted to simultaneously serve two principals whose interests conflict about the matter served — at least, not without full disclosure and consent from both.” (Brown v. FSR Brokerage, Inc. (1998) 62 Cal.App.4th 766, 778.) SB 1171 is just the first step. In the future we hope to sponsor legislation that also includes a requirement that all real estate brokers must provide Errors & Omissions Insurance. Proof of this insurance should be provided to the client prior to engaging in a working relationship. But Rome wasn’t built in a day, so we have got our work cut out for us. n

Attorney Journal San Diego | Volume 131, 2014

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