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Entries in court decisions (10)

Friday
Mar102017

Initiating Unlawful Detainer Actions: Perfection Not Required

Business LitigationReal Estate Litigation Attorney

by Nicholas Kanter
818-907-3289

 

In November 2016 the California Supreme Court ordered that a decision from the appellate division of the San Diego Superior Court in U.S. Financial, L.P. v. Michael McLitus (“McLitus”) be published.   

McLitus held that an owner that acquires a property at a non-judicial foreclosure sale is required to perfect title before serving a Three Day Notice to Quit, the first step in initiating an unlawful detainer action under Code of Civil Procedure §1161a. The court held if the Notice to Quit was served before title was perfected, the notice would be defective and could not support an unlawful detainer action.

Commercial Tenant Eviction

Based on the decision in McLitus, the new owner of a property purchased at foreclosure would have to wait to receive the Trustee’s Deed Upon Sale from the foreclosure trustee, and then until the Trustee’s Deed is recorded by the county recorder, before serving a Three Day Notice to Quit. Thus, McLitus had the potential effect of delaying a new owner from obtaining possession to an occupied property.

McLitus Decision Short-Lived

Four months after the McLitus decision was ordered published, the Second Appellate District of the Court of Appeal issued an opinion squarely rejecting the McLitus holding.   

In Dr. Leevil, LLC v. Westlake Health Care Center (“Westlake”), Westlake Village Property, which owned Westlake Health Care Center (WHCC), defaulted on a loan and filed for bankruptcy. The bank sold the loan to Leevil who instituted a non-judicial foreclosure, and subsequently purchased the health care center at a trustee’s sale. Leevil then served a Notice to Quit on WHCC. When WHCC refused to vacate the property, Leevil filed an unlawful detainer action under §1161a. Leevil ultimately obtained possession to the property.

On appeal, WHCC relied on the McLitus decision to argue the Notice to Quit was invalid because Leevil did not perfect title before serving the Notice. 

The Court of Appeal rejected WHCC’s argument and affirmed the trial court’s decision. The Court found that §1161a does not require that title be perfected prior to serving a Notice to Quit. Rather, this Section only requires that title be perfected before a party may be removed from the property following a foreclosure sale.

Code Civ. Proc. Section 1161a states, in pertinent part:

a person who holds over and continues in possession of . . . real property after a three-day written notice to quit the property has been served . . . may be removed therefrom . . . [w]here the property has been sold in accordance with [s]ection 2924 of the Civil Code . . . and the title under the sale has been duly perfected.

Nothing in Section 1161a requires that title be perfected before a Three Day Notice to Quit is served.  Further, the Court of Appeal held that “[n]one of the cases cited in McLitus support the requirement that title be perfected before service of the notice to quit.”

Future of Unlawful Detainer Suits

Because the Westlake decision is binding on lower courts, and decisions from the Appellate Division of the Superior Court are not, trial courts should be guided by Westlake.  Accordingly, as it stands now, purchasers at foreclosure do not have to wait until title is perfected before serving a Three Day Notice to Quit.  

Nicholas Kanter is a Real Estate and Business Litigation attorney. 

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Tuesday
Aug302016

The Curious Case of Employment Arbitration Agreements

Lawyer for EmployersLawyer for Employers

 

by Tal Burnovski Yeyni

818-907-3224

 

Oh boy, what a year 2016 is shaping up to be! Employers faced some daunting changes to: Sick Leave, California Minimum Wage, the DOL final rule  re salary thresholds and now – class action waivers. We feel like doing a Liz Lemon style “12 month rap wrap up”. But unlike Avery Jessup in 30 Rock, reading some US Weeklies won’t resolve the situation. (If you don’t understand, go watch ”The Return of Avery Jessup”. It’s hilarious!) 

Class Action LawsuitMeanwhile, in the real world, we noticed a trend in California to limit the scope of employment arbitration agreements. Two years ago the California Supreme Court ruled that PAGA (Private Attorneys General Act) representative claim waivers in employment arbitration agreements are unenforceable (Iskanian v. CLS Transp. Los Angeles, LLC (2014) 59 Cal.4th 348).

And last year the legislature attempted to pass AB-465 which would have prohibited employers from requiring employees to sign arbitration agreements as a condition of employment. Governor Brown however, vetoed the bill opining, in part, that “[A] blanket ban on mandatory arbitration agreements is a far-reaching approach...”

Last week the Ninth Circuit took part in the “arbitration debate” and held that Class Action Waivers in employment arbitration agreements are unenforceable. In Morris v. Ernst & Young LLP (9th Cir. 8/22/2016) No. 13-16599 plaintiffs brought a class action against the accounting firm Ernst & Young for misclassification,  FLSA (Fair Labor Standards Act) and California labor laws violations.

The professional services firm moved to compel arbitration pursuant to the arbitration agreements signed by plaintiffs, which contained a “concerted action waiver” requiring employees to pursue legal claims against E&Y exclusively through arbitration, and arbitrate only as individuals and in “separate proceedings.”  Plaintiffs argued the class action waiver was unenforceable as it violated the National Labor Relations Act (NLRA).

Section 7 of the NLRA guarantees the right of employees to engage in concerted activities. Section 8(a)(1) of the Act makes it an unfair labor practice for an employer "to interfere with, restrain, or coerce employees in the exercise of the rights guaranteed in Section 7" of the NLRA.

The Ninth Circuit in a majority decision agreed with plaintiffs and sided with the National Labor Relations Board (NLRB) position in Horton I, 357 NLRB No. 184, which held that an employer violates the NLRA “when it requires employees covered by the Act, as a condition of their employment, to sign an agreement that precludes them from filing joint, class, or collective claims addressing their wages, hours, or other working conditions against the employer in any forum, arbitral or judicial.”

The Majority opined that a lawsuit filed in good faith by a group of employees to achieve more favorable terms or conditions of employment is “concerted activity” under Section 7 of the NLRA and reasoned that “an employer violates § 8 (...) by conditioning employment on signing a concerted action waiver.” [Emphasis added]. 

Employment ArbitrationWith this decision, the Ninth Circuit teamed up with the Seventh Circuit which recently held that a class action waiver in arbitration agreements was unenforceable as it violated employees’ rights under the NLRA. Other circuits (the Second, the Eighth and the Fifth) held to the contrary, validating class action waivers in employment arbitration agreements. Due to the circuit split, it is likely the matter will be taken up to the U.S. Supreme Court. 

It will be interesting to see how California courts would handle the matter (if at all). Notably, while the California Supreme Court prohibited PAGA waivers in employment arbitration agreements it rejected the argument that class action waivers are unlawful under the NLRA (Iskanian, supra, 59 Cal.4th at 372). “As the Fifth Circuit explained, neither the NLRA’s text nor its legislative history contains a congressional command prohibiting such waivers.” 

Thus, on its face, it appears the California Supreme Court position regarding the enforceability of class action waivers currently differs from the Ninth Circuit’s recent ruling.

To be continued . . .

Tal Burnovski Yeyni is an attorney in our Employment Practice Group

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Tuesday
Feb102015

Employers: CA Court of Appeal Rules On-Duty Rest Breaks Permitted

Lawyer for EmployerClass Action Defense Attorney

 

by Nicole Kamm

818.907.3235

 

 

 

In late January, a California Court of Appeal issued a ruling in Augustus v. ABM Security Services, Inc., overturning a $90 million award against the company because ABM required its security guards to keep their radios and pagers on during rest breaks, remain vigilant, and respond as needed.

Wage and Hour Law California

The ruling came nearly three years after a trial court certified a class of thousands of current and former security guards, and awarded summary judgment to the plaintiffs following a lengthy legal battle. The lower court held California law requires employers to relieve workers of all duty during rest breaks.

The facts of the case were not in dispute: ABM provided – and security guards took – regular rest breaks. 

Plaintiffs alleged, however, the breaks were not compliant with California law because the guards were required to remain “on-call” during rest breaks.  They contended California law requires employees be relieved of all duties during such breaks.

Rest Breaks Distinguished From Meal Breaks

On appeal, the Court held California law only requires employees be relieved of working during rest breaks.  Contrary to meal breaks – which are unpaid time – the law does not require employees be relieved of being on duty or all employer control during paid rest breaks. 

The Court considered the nature of a rest break, and whether being on-call means performing work, and found that it did not. The Court noted ABM security guards engaged in various activities while taking breaks, including surfing the net, making personal phone calls, etc.  "Admittedly, an on-call guard must return to duty if called to do so, but remaining available to work is not the same as actually working.”

As noted above, the Court distinguished the law regarding California’s meal break requirement and that relating to rest breaks.  While meal breaks specifically require employees be “relieved of all duty,” there is no similar language for the provision of rest breaks.

The Appellate Court reiterated that being on-call does not necessarily mean that employee is performing work, and remaining available to work is not the same as actually working

Employer Takeaway

Prior rulings and Department of Labor Standards Enforcement opinions were contradictory as to the extent of control employers could impose on employees during rest breaks. 

This case provides helpful guidance for employers regarding obligations pursuant to California’s rest break requirements.  Pursuant to this case, employers may not require employees to work, but are not required to relieve employees of all duty, during rest breaks.

 

 

Nicole Kamm is an Employer Defense Attorney experienced in wage and hour and other employee class action law suits. Contact her via email: nkamm@lewitthackman.com or by phone: 818.907.3235 for more information.

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Friday
Jul112014

The Road Ahead for California Transportation Industry Employers

Wage and Hour Defense Attorney Employment Defense Attorney

 

by Sue M. Bendavid & Hannah Sweiss

 

The 9th Circuit Rules FAA Authorization Act Does Not Preempt State Meal and Rest Break Laws

On July 9, 2014, in Dilts v. Penske Logistics, Inc. the Ninth Circuit Court of Appeals held that, for motor carrier employers, California’s meal and rest break laws are not preempted by the Federal Aviation Administration Authorization Act of 1994 (“FAAAA”).      

Class Action: 349 delivery drivers and installers claim Defendants create an environment that discourages employees from taking breaks.Up until this ruling, motor carrier employers tried to argue they need not comply with California’s meal and rest break rules, as those rules had an impermissible negative impact on “prices, routes and services” and therefore, those laws were preempted by federal law under the FAAAA.

Defendants in Dilts argued compliance with California’s meal and rest break laws would force drivers to deviate from routes and would result in a cessation of delivery services throughout the day. This could cause longer delivery times and greater costs to employers. However, the Ninth Circuit was unpersuaded.  

 

The Ruling's Impact on California Employers     

So what does this mean for certain motor carriers in the transportation industry?

Generally, under California law an employer must provide a duty free meal break of 30 minutes for nonexempt employees who work more than five hours and a second 30 minute duty free meal break for those who work more than 10 hours. If a nonexempt employee’s total daily work time is at least 3.5 hours, employers must also provide a paid rest period of 10 minutes for every four hours or major fraction thereof.

Based on this decision, motor carrier employers may have to: 

  • Hire more drivers,

  • Stagger employee break times,

  • Reallocate resources to maintain a particular service level,

  • Allow drivers to make minor deviations from their routes, and

  • Make other changes to ensure compliance with California’s meal and rest break rules.

A failure to do so may result in substantial penalties and is expected to result in more class actions on this issue. 

Sue M. Bendavid and Hannah Sweiss are Wage and Hour Defense Attorneys at our Firm. Contact them directly: sbendavid@lewitthackman.com or 818.907.3220; hsweiss@lewitthackman.com or 818.907.3260, for more information.

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

Friday
Mar072014

Employers: Don't Forget to Designate Employees' Time Off

Wage and Hour DefenseEmployee Leave of Absence Claim Defense

No Harm No "Fowl" in FMLA Case - 9th Circuit

by Sue M. Bendavid

818.907.3220

 

Score one for the employers in this case, but do so with caution:

Foster Farms did not violate California and federal law when the company fired an employee for returning to work more than two weeks after her vacation ended, according to the Ninth Circuit Court of Appeals.

Lawyers for Employers - FMLA ClaimsThe employee, Maria Escriba, requested two weeks' vacation to tend to her ill father in Guatemala. Her supervisor asked Escriba twice if she needed to apply for leave under the Family and Medical Leave Act (FMLA), which Escriba declined. She then asked for additional vacation time, but that request was denied.

When her vacation ended, Escriba did not contact Foster Farms to request time under FMLA. Foster Farms fired her because of their "three day no-show, no call" policy. Escriba claimed her FMLA rights should have automatically gone into effect to cover the additional two weeks because her employer knew she was attending to a sick parent.

The Ninth Circuit disagreed with Escriba, saying: 

An employer’s obligation to ascertain “whether FMLA leave is being sought” strongly suggests that there are circumstances in which an employee might seek time off but intend not to exercise his or her rights under the FMLA…We thus conclude that an employee can affirmatively decline to use FMLA leave, even if the underlying reason for seeking the leave would have invoked FMLA protection.

A notable fact in this case was that Escriba had obtained FMLA leave 15 times in her 18 year work history at Foster Farms, indicating a familiarity with the request process. Escriba’s supervisor knew she needed time off to care for an ill family member, and thus asked Escriba twice, with the help of a Spanish language interpreter, whether Escriba wanted to take FMLA leave. 

That worked in Foster Farms' favor, as the evidence demonstrated the supervisor took reasonable steps to protect the employee's FMLA rights, and the interpreter later served as a witness who could attest that proper steps were taken.

 

Employer's Responsibility to Communicate and Designate

 

Though the decision went in favor of Foster Farms, this case provides some important reminders for employers: 

  • Communication – a key factor in preventing employee claims. First, supervisors should be fully aware of employee rights regarding the California Family Rights Act and the federal FMLA rules. Secondly, it's the employer's responsibility to determine the nature of a leave.


  • Documentation – equally important. Be sure to document the employee's decision when they choose whether or not to take a leave of absence.


  • Designation – When an employee elects FMLA/CFRA leave, make sure you specifically designate the time off as FMLA/CFRA. 

 

Sue M. Bendavid is an Employer Defense Attorney, and Chair of our Employment Practice Group. Contact her via email: sbendavid@lewitthackman.com

Disclaimer:
This Blog/Web Site is made available by the lawyer or law firm publisher for educational purposes only, to provide general information and a general understanding of the law, not to provide specific legal advice. By using this blog site you understand there is no attorney client relationship between you and the Blog/Web Site publisher. The Blog/Web Site should not be used as a substitute for obtaining legal advice from a licensed professional attorney in your state.

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