Kleinman v. Nir

Filed 8/22/08 Kleinman v. Nir CA2/5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FIVE

APPEAL from a judgment of the Superior Court of Los Angeles County, Irving Feffer, Judge. Affirmed.

Law Offices of Susan Balistocky and Susan Balistocky for Plaintiff and Appellant.

Law Offices of Lawrence M. Lebowsky, Lawrence M. Lebowsky; Law Offices of Andrea M. Caster and Andrea M. Caster for Defendants and Respondents.

____________________________________

In this action for damages and an accounting, plaintiff and appellant Samuel J. Kleinman appeals from a judgment following a court trial in favor of defendants and respondents Pnina Nir and Joseph Barth. Kleinman contends the trial court committed prejudicial error by excluding documentary evidence and expert testimony, and precluding Kleinman from presenting expert testimony in rebuttal. We conclude Kleinman has failed to show prejudicial error and affirm the judgment.

Procedural History

On May 21, 2004, Kleinman filed a complaint for damages and other relief against defendants. As amended, the complaint alleged five causes of action: dissolution of partnership; damages for fraudulent concealment; damages for breach of fiduciary duty; conversion and imposition of constructive trust; and an accounting.^[1]

Kleinman alleged that he and defendants were partners in a business of selling property in Israel owned by heirs living in the United States. Kleinman and Nir formed the business in 1996, and Barth joined the partnership in 1997. During and after 1997, defendants engaged in a pattern of activity to exclude Kleinman from partnership activities. Kleinman alleged he did not discover the nature and extent of Defendants conduct, as well as the damages which he would sustain as a [reasonably] foreseeable consequence of said conduct until on or about December 1, 2002, when the gravity of the harm caused by Defendants conduct began to crystallize.

In their answers, defendants denied the allegations and asserted, inter alia, the statute of limitations as an affirmative defense.

Although defendants served discovery requests, Kleinman did not comply in a proper form or timely fashion. As a result of Kleinmans failure to comply with discovery, the trial court granted defendants motion in limine precluding Kleinman from introducing evidence and calling witnesses on issues covered by the requested discovery. However, during trial, the trial court overruled defendants evidentiary objections that were based on the ruling on the motion in limine and, on an individual basis, admitted documents and information Kleinman had not disclosed during discovery. Among the documents admitted by the trial court were an agreement signed in June 1997 between Mrs. Popish and Barth and Barths letter terminating the agreement.

The trial court excluded from evidence an agreement signed by an heir to a property referred to as the Herman estate. The document had not been produced in discovery, was not on Kleinmans exhibit list, and had never been seen by defendants counsel. Also excluded because of the discovery violation were faxes Barth sent to Kleinman concerning various estates. A list of 60 names of estates that Barth was asked about in his deposition was excluded because it was not produced in discovery and because the trial court had previously ruled that the deposition could only be used to oppose Barths summary judgment motion.

During the trial, the trial court denied Kleinmans request to call Lev Hakak to testify as an expert concerning the process of transferring title to escheated property to heirs, because Hakaks name had not been exchanged with defendants. Over Kleinmans objection, Barth, a real estate broker licensed in California, was permitted to testify as an expert in the field of real estate, including real estate in Israel. The trial court denied Kleinmans request to call an expert witness in rebuttal to impeach Barths expert testimony. Kleinman was permitted to testify on rebuttal to impeach Barths expert testimony.

After the parties rested, defendants argued that the action was barred by the statute of limitations. Contending that the longest statute of limitations for any of the causes of action was four years, defendants argued the evidence showed Kleinman was aware of defendants alleged wrongdoing beginning in 1997, more than four years before he filed the complaint in this action.^[2] Kleinman argued the statute was tolled until the harm to Kleinman was appreciable and actual, which did not occur until he learned in 2006 that property known as the Srera estate had been sold. There was no actual harm until then, he claimed, because most of the parties efforts will never result in sales.

The trial court awarded judgment for defendants. The trial court ruled the complaint was barred by the statute of limitations and Kleinman did not meet his burden of proof. The trial court did not believe Kleinmans testimony, finding it evasive and contradictory, but found Barths testimony to be credible. This timely appeal followed.

STATEMENT OF FACTS

Kleinman introduced into evidence a written agreement between himself and defendants dated October 13, 1997, which defined how proceeds from the sale of an heirs property would be distributed. Barths responsibilities were to find the heirs, negotiate agreements with them, secure and process all required documentation to the satisfaction of the courts in Israel, and do what was necessary to bring all deals to completion.

Kleinman called Barth to testify under Evidence Code section 776. On October 13, 1997, Barth entered into a fee agreement with Kleinman and Nir pursuant to which Barth would receive 20 percent of the commissions that Kleinman and Nir earned as agents for the heirs in sales of land in Israel. His role was to look for heirs, contact them, and persuade them to claim their assets in Israel. Barth worked as a broker, receiving commissions, not as a partner in the business. On May 12, 1998, Barth withdrew from the October 13, 1997 agreement. The Granoff and the Herman estates were the only cases he worked on under the October 13, 1997 agreement after he submitted his May 1998 withdrawal letter. Barth did not refuse to discuss the Herman estate case with Kleinman. As Kleinman was not a party to an agreement with the Srera heirs, he did not receive any of the commission from the sale of the Srera estate.

Barth testified that Israeli land records are available to the heirs and their representatives. The general administrator in Israel has a list of 17,000 estates, including the names of the original owners and the location of the parcels. From that list, one can readily track down the heirs to those estates. Prospective buyers and people who believe they are heirs have access to records in the land registration department, from which they can determine the ownership of the estate. Much information is readily available to the general public about land ownership through courts, Zionist organizations, cities, and online.

Barth testified that Kleinman told him he was suspicious concerning the Sosnofsky estate in April 1998. On May 3, 1998, and on many other occasions in 1998, Kleinman threatened to sue defendants over the Sosnofsky estate. Kleinman complained to the Herman estate heirs in March of 1999 and threatened to sue them. In 1999, Kleinman threatened to sue the Granoff estate heirs unless they guaranteed to pay him 35 percent of the value of the property as a fee. Kleinman sued Nir and others in Israel in connection with the Sosnofsky estate. Kleinman dismissed the Sosnofsky lawsuit without having reached an agreement with defendants about the estate business.

Kleinman testified on his own behalf. Prior to entering into the October 13, 1997 agreement, Kleinman had identified over 1,000 estates. He intended the arrangement with defendants to be a partnership, not simply a fee-splitting arrangement. Nir and Kleinman gathered information about estates from all over Israel, Europe, and the United States. The data was put into a database and maintained in Nirs computer. Kleinman assigned specific properties and heirs to Barth. The objective of the business was to sign up as many heirs as possible, process the claims, and collect a 30 percent fee. Processing an heirs claim to an estate in Israel was difficult, involved many steps, and took many years. Barth continued working on many estates after he submitted his letter of withdrawal in May 1998. Barth continued working with Kleinman on a daily basis until the end of 1998 or early 1999.

Kleinman testified that he first suspected defendants were engaging in activities that could lead to a breach of duties to him in 1998-1999. In 1998 and 1999, defendants told the heirs not to speak to Kleinman and refused to respond to his requests for information. In 1998, Nir stopped allowing Kleinman access to the estate data they had gathered and hid documents from him. Because he could get no information from defendants, Kleinman tried to obtain information from the heirs, beginning in the late 1990s. Some of the heirs told him not to worry because they would pay him when the time came. In 1999, he sent letters to heirs, including the Hermans, threatening to sue them, although he did not really mean it. His purpose was to obtain information about the status of the estates. The Hermans responded in 1999 that they would not give him information.

In 1999, Kleinman sued Nir and others in Israel, intending to place a lis pendens on the Sosnofsky estate. Kleinman believed defendants had bought the estate from the heirs in 1998 for a dishonestly low price, without notice to Kleinman. The lawsuit was to force Nir to make a fair disbursement of the funds to the heirs from the sale of the estates. Kleinman dismissed the lawsuit because he entered into discussions with Nir about how they would continue their business. He began to look up land records in 2000 or 2001 to try to find out what was happening with the estates. He stopped sending letters to the heirs and worrying about whether he would be paid, but he began worrying again in late 2002, when he heard a rumor that something had happened to the Srera estate. He learned in 2003 that defendants had misrepresented information about estates to him and had signed up the heirs without telling him.

Kleinman testified that the first time he learned that an estate he had worked on with defendants had reached the point where the land was sold was when Barth testified in a deposition in 2006 that he was paid a fee from the sale of the Srera estate. Kleinman could not find out what had happened to the estates because of the secrecy laws of Israel.

Kleinman testified in rebuttal in an attempt to discredit Barths testimony concerning how difficult it is to obtain information about ownership of land in Israel. Kleinman had been involved in obtaining land records in Israel since 1994. It is not easy to get information about ownership of land. It took ten years to process an heirs claim because: the names on the list of 17,000 estates are in Hebrew and may have a variety of spellings in English; there is nothing to specifically identify the individual named on the list; the individuals may have bought the land 80 or 100 years ago; there is still the task of finding the heirs; once the heirs are located, there needs to be a succession order from an Israeli court, which can take two to five years; after an heir is declared, there must be a petition to the government custodian to declare the heir connected to the land, which requires a great deal of proof; and it can take a year for the person who traces the heir to be paid after the land is sold.

DISCUSSION

No Prejudicial Error Was Shown

Kleinman argues the trial court committed prejudicial error in excluding documentary evidence based on the ruling on the in limine motion and also by precluding Kleinman from putting on expert testimony on Israeli land law in his case-in-chief and on rebuttal. Kleinman contends the excluded documents and expert testimony would have demonstrated the suit was not barred by the statute of limitations and made Kleinman more credible and Barth less credible.

In response to Kleinmans contentions, defendants argued in part that Kleinman had not met his burden of demonstrating prejudicial error on appeal. Specifically, defendants argued that Kleinman never identifies a single document that was excluded at trial based on the in limine order. According to defendants, Kleinman not only failed to identify specific documents that were excluded, he also failed to explain why that evidence was necessary and not duplicative of other evidence admitted and how its exclusion was prejudicial. Defendants also argued that some documents excluded by the in limine ruling were nonetheless admitted during trial. We agree that Kleinman has failed to establish prejudicial error as required by the California Constitution, statutory provisions, and settled case law.

No judgment shall be set aside, or new trial granted, in any cause, on the ground of misdirection of the jury, or of the improper admission or rejection of evidence, or for any error as to any matter of pleading, or for any error as to any matter of procedure, unless, after an examination of the entire cause, including the evidence, the court shall be of the opinion that the error complained of has resulted in a miscarriage of justice. (Cal. Const., art. VI, 13.) A miscarriage of justice results, under California law only when the court, after an examination of the entire cause, including the evidence, is of the opinion that it is reasonably probable that a result more favorable to the appealing party would have been reached in the absence of the error. (People v. Watson (1956) 46 Cal.2d 818, 836; see Zhou v. Unisource Worldwide (2007) 157 Cal.App.4th 1471, 1480, fn. 4.)

The trial courts error in excluding evidence is grounds for reversing a judgment only if the party appealing demonstrates a miscarriage of justicethat is, that a different result would have been probable if the error had not occurred. ([Evid. Code,] 354 [[a] verdict or finding shall not be set aside, nor shall the judgment or decision based thereon be reversed, by reason of the erroneous exclusion of evidence unless the court which passes upon the effect of the error or errors is of the opinion that the error or errors complained of resulted in a miscarriage of justice]; Code Civ. Proc., 475 [[n]o judgment, decision, or decree shall be reversed or affected by reason of any error, ruling, instruction, or defect, unless it shall appear from the record that such error, ruling, instruction, or defect was prejudicial, and also that by reason of such error, ruling, instruction, or defect, the said party complaining or appealing sustained and suffered substantial injury, and that a different result would have been probable if such error, ruling, instruction, or defect had not occurred or existed]; Pool v. City of Oakland (1986) 42 Cal.3d 1051, 1069; see City of Oakland v. Public Employees Retirement System (2002) 95 Cal.App.4th 29, 51-52 [prejudice will not be presumed; burden rests with party claiming error to demonstrate not only error, but also a resulting miscarriage of justice].) (Zhou v. Unisource Worldwide, supra, 157 Cal.App.4th at p. 1480, fn. omitted; see also Saxena v. Goffney (2008) 159 Cal.App.4th 316, 332; Mardirossian & Associates, Inc. v. Ersoff (2007) 153 Cal.App.4th 257, 276; Reedy v. Bussell (2007) 148 Cal.App.4th 1272, 1289.)

Other authorities are in accord with Zhou v. Unisource Worldwide, supra, 157 Cal.App.4th 1471. (E.g., Paterno v. State of California (1999) 74 Cal.App.4th 68, 106 [Because of the need to consider the particulars of the given case, rather than the type of error, the appellant bears the duty of spelling out in his brief exactly how the error caused a miscarriage of justice].)

The most fundamental rule of appellate review is that an appealed judgment or order is presumed to be correct. [Citation.] It is the appellant who bears the burden of overcoming that presumption. [Citation.] (State Water Resources Control Bd. Cases (2006) 136 Cal.App.4th 674, 836.) It is not the job of an appellate court to act as counsel for appellant by furnishing a legal argument as to how the trial courts ruling was prejudicial. (Mansell v. Board of Administration (1994) 30 Cal.App.4th 539, 545-546.) Nor do we have the obligation to independently review the record to determine if an error was prejudicial. (Haley v. Casa Del Rey Homeowners Assn. (2007) 153 Cal.App.4th 863, 871; City of Watsonville v. Corrigan (2007) 149 Cal.App.4th 1542, 1545, fn. 1; American Internat. Specialty Lines Ins. Co. v. Continental Casualty Ins. Co. (2006) 142 Cal.App.4th 1342, 1367, fn. 5; Chapman v. Superior Court (2005) 130 Cal.App.4th 261, 271.) Instead, the reviewing court is entitled to the assistance of counsel. (Haley v. Casa Del Rey Homeowners Assn., supra, 153 Cal.App.4th at p. 871.)

After defendants demonstrated that Kleinman had not identified the excluded documents with specificity, nor demonstrated how exclusion of any document, singularly or in combination, was prejudicial error, Kleinman failed to remedy the deficiency in his reply brief. In the reply brief, Kleinman took issue with defendants argument that all of the evidence excluded by the in limine ruling was thereafter admitted at trial, because the trial court denied appellants counsel attempts to introduce the Herman Agreement, a series of faxes, and a list of names of estates.^[3] According to Kleinman, the excluded evidence demonstrated the relationship of the parties and Barths role in the partnership, the fact projects were continuing, and the parties mutual expectation of being paid upon completion of each property transaction.

However, none of Kleinmans arguments are supported by citation to the record on appeal. He does not discuss the content of any particular document, nor does he explain how the documents exclusion impacted resolution of the case. Although he refers to faxes through his briefs, at no point are we informed with any degree of specificity of the actual content of any partys fax. Without a clear understanding of the significance of the excluded documents to the merits of the action, and an explanation of how their exclusion undercut the reliability of the trial courts finding, Kleinman has not sustained his obligation of affirmatively showing prejudicial error.

The trial court ruled in defendants favor on a statute of limitations defense. Kleinmans briefs do not identify the applicable limitations periods for each cause of action with citation to legal authority. Most significantly, Kleinman does not explain how any excluded document would demonstrate that the causes of action were not outside the applicable limitations period.

Kleinmans position fares no better regarding the exclusion of expert testimony. Kleinmans counsel failed to make a specific offer of proof in the trial. The only description of the experts testimony was the following: The person we intend to call, Your Honor, . . . to describe the process of having the Israeli government transfer title to property that is escheated to them many, many years ago back to their heirs. And its a very lengthy and detailed process. And only somebody who has the requisite background and knowledge and technical information thats experienced in that can come in and explain that to the court.

This general offer of proof is manifestly insufficient to demonstrate that there is a reasonable probability the result would have been different had the trial court not excluded the experts testimony. The offer of proof appears unrelated to the statute of limitations issue. It is not clear to what extent, if any, the expert disagrees with the balance of the evidence in the record regarding the process involved in locating heirs and selling property. Moreover, there is nothing in Kleinmans briefs to affirmatively establish how the experts testimony was at all relevant to the statute of limitations issue or that Kleinman was a more credible witness than Barth.

Kleinman cites no legal authority on appeal for his argument that the statute of limitations did not begin to run until a property was ready to be placed on the market, again missing the mark on his obligation to demonstrate prejudicial error. There were numerous discrepancies between Kleinmans testimony and Barths testimony that did not pertain to Israeli real estate laws and procedures. Kleinman fails to explain how expert testimony on Israeli real estate matters would have impeached Barths testimony and bolstered Kleinmans credibility on those matters.

In short, prejudicial error has not been shown.

DISPOSITION

The judgment is affirmed. Costs on appeal are awarded to defendants.

KRIEGLER, J.

We concur:

ARMSTRONG, Acting P. J.

MOSK, J.

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^[1] On January 12, 2007, Kleinman dismissed two other causes of action, defamation and intentional interference with economic relations, with prejudice.

^[2] Defendants cited evidence that Kleinman suspected wrongdoing or dishonesty in 1997, was denied access to documents concerning the estates beginning in 1998, and threatened heirs, sued Nir, and learned the Herman heirs would not give him a commission in 1999.

^[3] In fact, the trial court admitted the list of estates. As to the Herman Agreement, Kleinman does not show how exclusion of this document was an abuse of discretion considering that it had not been produced during discovery, was not specified on an exhibit list, and had not been seen before by defendants counsel.