Freden v. Ozel Fine Jewelry
Filed 6/7/13 Freden v. Ozel Fine Jewelry CA4/2
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California
Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or
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purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF
FOURTH APPELLATE DISTRICT
DIVISION TWO
TANYA FREDEN,
Plaintiff
and Respondent,
v.
OZEL FINE JEWELRY,
Defendant
and Appellant.
E054136
(Super.Ct.No.
CIVSS805579)
OPINION
APPEAL
from the Superior Court
of
Bernardino County.
Donna G. Garza, Judge. Affirmed
in part; reversed in part.
Gutierrez,
Preciado & House and Calvin R. House for Defendant and Appellant.
Law
Offices of Timothy B. McCaffrey, Jr., Timothy B. McCaffrey, Jr., and Natasha R.
Chesler for Plaintiff and Respondent.
Tanya Freden (Freden) sued her
former employer, Ozel Fine Jewelry (Ozel).
A jury found Ozel failed to pay Freden (1) overtime wages (Labor Code,
§ 510),
title="">[1] and (2) all the wages due to her when her
employment was terminated. (§ 201.) For the failure to pay overtime wages, the
jury awarded Freden $21,000. The trial
court entered judgment in favor of Freden in the amount of $51,353.84, which
was comprised of the $21,000 for the overtime award and $30,353.84 for wait time
penalties (§ 203).
Ozel
contends the trial court erred by entering judgment in the amount of $51,353.84
because (1) the jury awarded Freden compensatory damages for the failure to pay
overtime, when statutorily, Freden can only be awarded the overtime wages
without any further damages; and (2) the trial court miscalculated the wait time
penalty. We reverse the damages portion
of the judgment.
Freden
sued Ozel for (1) sexual harassment; (2) wrongful discharge; (3) failure to pay
overtime wages; and (4) failure to pay all wages due at the time of terminating
employment. The jury found in favor of
Freden on the claims of (1) failing to pay overtime wages, and (2) failing
to pay all wages due at the time of terminating employment. The jury found Freden was not sexually
harassed or wrongfully terminated. During
trial, Freden testified that she was unsure how much money Ozel owed her for
her wages, and said that she left the calculations to her attorneys. During closing arguments, Freden’s trial
attorney argued that Freden was due $291 in overtime compensation. Freden’s trial counsel further argued Freden was
owed $21,000 in “total unpaid compensation,†which included her economic
damages for being unemployed “for roughly six to seven months.â€
During
deliberations, the jury asked the trial court, “Can we award damages on [the
failure to pay overtime]?†The trial
court contacted the parties, neither party raised an objection, and then the
trial court responded, “Yes,†to the jury’s question. The jury awarded Freden $21,000 for her
overtime claim. The trial court awarded
Freden a total sum of $51,353.84, which was comprised of $21,000 for overtime
wages and $30,353.84 for wait time penalties.
Ozel
filed a motion for a judgment notwithstanding the verdict, or in the
alternative, a motion for new trial. In
the motion, Ozel argued the damages were excessive and not supported by the
evidence. Ozel figured that for Freden
to be owed $21,000 in overtime compensation she would have needed to work 95
hours per week—40 regular hours and 55 overtime hours. Freden was paid $10 per hour plus
commissions.
The
trial court denied Ozel’s motions. The
trial court reasoned the overtime issue was “so intertwined†with the
termination claims that they “all blended together,†and therefore, the jury’s
award of $21,000 for failure to pay overtime was supported by the evidence. The trial court said, “The Court will
indicate in this matter, since the information was so intertwined between every
cause of action, and because there appears to be damages that she suffered, not
only while there, but after there is a rational basis for the jury arriving at the
$21,000 award in this matter.â€
A. OVERTIME DAMAGES
1. CONTENTION
Ozel
contends the trial court erred by entering judgment in favor of Freden in the
amount of $21,000 for the overtime cause of action, because Freden’s damages
must be limited to the unpaid wages. We
agree.
2. INVITED
ERROR
As
a preliminary matter, we address Freden’s argument that Ozel should be estopped
from raising this issue on appeal because Ozel invited the error by not
objecting when the jury asked if it could award damages for the overtime cause
of action. We conclude Ozel did not
invite the error.
“The
invited error doctrine is based on estoppel.
‘“Where a party by his conduct induces the commission of error, he is
estopped from asserting it as a ground for reversal†on appeal.’ [Citation.]â€
(Huffman v. Interstate Brands
Companies (2004) 121 Cal.App.4th 679, 706, italics omitted.) “[T]he invited error doctrine requires
affirmative conduct demonstrating a deliberate tactical choice on the part of
the challenging party. [Citations.]†(Id.
at p. 706; see also Pioneer Const. Inc.,
v. Global Inv. Corp. (2011) 202 Cal.App.4th 161, 169.) The record must reflect the appellant’s
tactical reason for inviting the alleged error, in order for the doctrine to
apply. (People v. Tate (2010) 49 Cal.4th 635, 695, fn. 32.) The purpose of the doctrine is to “prevent[] a
party from misleading the trial court and then profiting therefrom in the
appellate court. [Citations.]†(Norgart
v. Upjohn Co. (1999) 21 Cal.4th 383, 403.)
The
jury asked the trial court if it could “award damages†on the overtime wage
cause of action. The record reflects
that at 2:37 p.m. the question was received and the trial court “calledâ€
counsel. At 2:48 p.m., the trial court responded
“Yes†to the jury’s question, and the jury resumed deliberations.
It
is unclear what discussion, if any, took place between the trial court and
trial counsel during the 11 minutes between the question being submitted and
the response being given to the jury. It
is unclear if the trial court even spoke to Ozel’s counsel before responding to
the jury, since there is nothing indicating the telephone call resulted in a
conversation. Since the record does not
reveal what, if any, comments Ozel might have made about the response, we
cannot determine whether Ozel made a deliberate and tactical choice to mislead
the trial court.
Moreover,
we note that it is not clear Ozel should have raised an objection or that the
“Yes†response was misleading. There is
a gray area here, due to the term “damages†being vague in this context. Ozel could have believed the jury’s question
about “damages†referred to the remedy offered by the statute, not an amount in
excess of the statutory damages. (See
e.g. Bell v. Farmers Ins. Exchange
(2004) 115 Cal.App.4th 715, 755 [“proof of aggregate damages for
time-and-a-half overtimeâ€]; Brewer v.
Premier Golf Properties (2008) 168 Cal.App.4th 1243, 1247 [the jury
“awarded damages totaling less than $1,000 for unpaid regular and overtime
wagesâ€]; Amaral v. Cintas Corp. No. 2 (2008)
163 Cal.App.4th 1157, 1189 [“plaintiffs to prove their damages for unpaid
overtimeâ€].) Since Ozel could have
reasonably believed there was no need to object, due to the vague use of the
word “damages†in the jury’s question, there is further reason for this court
not to apply the doctrine of invited error—beyond the fact that record provides
little insight into the possible conversations surrounding the response to the
jury’s question. Thus, we conclude the
doctrine of invited error is not applicable to this issue.
3. OVERTIME
LAW
We
begin by examining the law, in order to determine what damages may be collected
in a suit for unpaid overtime wages.
Since we are addressing a legal question, we apply the de novo standard
of review. (Blaich v. W. Hollywood Rent Stabilization Dept. (2011) 195
Cal.App.4th 1171, 1175.)
The
“new right-exclusive remedy†doctrine “provides that ‘[w]here a statute creates
new rights and obligations not previously existing in the common law, the
express statutory remedy is deemed to be the exclusive remedy available for
statutory violations, unless it is inadequate.’
[Citations.]†(
italics omitted.) “[A]n employer’s
obligation to pay overtime compensation to his employee would not exist but for
the Labor Code.†(Aubry v. Goldhor (1988) 201 Cal.App.3d 399, 404.) Therefore, the new right-exclusive remedy
doctrine applies to overtime wage violations.
The
Labor Code sets forth an express statutory remedy for overtime compensation
violations. Section 1194, subdivision
(a), provides: “Notwithstanding any
agreement to work for a lesser wage, any employee receiving less than . . . the
legal overtime compensation applicable to the employee is entitled to recover
in a civil action the unpaid balance of the full amount of this . . . overtime
compensation, including interest thereon, reasonable attorney’s fees, and costs
of suit.†Thus, the law reflects
overtime compensation suits are subject to an exclusive remedy provision, which
provides a plaintiff may collect: (1)
the wages due, (2) interest due on the wages, (3) attorney’s fees, and (4)
costs.
Freden
asserts the exclusive remedy should not apply in this case because section 1194
“does not use any language precluding the recovery for any other harms
proximately caused†by the failure to pay overtime. Freden’s argument is not persuasive because
the statute does not need to contain words limiting the right to recover, because
it affirmatively reflects what can be recovered. The Legislature cannot be expected to limit
every possibility that can occur in a lawsuit.
Rather, the Legislature has limited plaintiffs by affirmatively providing
the type of damages that can be collected in overtime compensation
lawsuits. (See MacIsaac v. Waste Management Collection and Recycling, Inc. (2005)
134 Cal.App.4th 1076, 1083 [we interpret words in a statute by their plain and
commonsense meanings, looking for the literal meaning of the statute].)
Moreover,
a court presumes the Legislature was aware of judicial decisions when amending
a statute. (Pieri v. City and County of San Francisco (2006) 137 Cal.App.4th
886, 891-892.) Section 1194 was last
amended in 1992. (Stats. 1992, ch. 427,
§ 120.) The new right-exclusive remedy doctrine was discussed by our Supreme
Court in 1990. (See Rojo v. Kliger (1990) 52 Cal.3d 65, 82.) Accordingly, if the Legislature did not want
the “‘new right-exclusive remedy’†doctrine to apply to section 1194, it could
have included that in the law; or, if the Legislature wanted greater damages to
be available, then it could have expanded the language of section 1194. However, as it stands, the plain
interpretation of section 1194 is that a plaintiff suing for overtime wages may
only collect (1) the wages due, (2) interest due on the wages, (3) attorney’s
fees, and (4) costs.
Next,
Freden asserts the exclusive remedy should not apply in this case because it is
inadequate. Specifically, Freden
contends she suffered further economic harms that were proximately caused by
Ozel’s failure to pay overtime, and therefore, the exclusive remedy would not
be sufficient in this case. Freden does
not specify what other damages she suffered as a result of Ozel’s failure to
pay overtime wages. Accordingly, we are
unable to assess whether the exclusive remedy is adequate.
4. DAMAGES
AWARDED
Ozel
questions the legality of damages awarded on the basis that the damages
conflict with the Labor Code. Thus, we
are addressing a question of law and apply the de novo
v. West Hollywood Rent Stabilization Dept., supra, 195 Cal.App.4th at p. 1175.)
As set forth ante, section
1194 provides that a plaintiff suing for overtime wages may only collect (1)
the wages due, (2) interest due on the wages, (3) attorney’s fees, and (4)
costs.
Freden
testified that she was unsure how much money Ozel owed her. Freden explained that, in regard to
calculations, “I left that to my lawyers.â€
During closing arguments, Freden’s trial counsel asserted Ozel owed
Freden $291 in overtime wages. Freden’s
trial counsel argued Ozel owed Freden $21,000 in “total unpaid compensation,â€
which included Freden’s economic damages for being unemployed “for roughly six
to seven months.†The jury awarded
Freden $21,000 for Ozel’s failure to pay her overtime wages.
The
jury’s damages verdict is improper, because the jury should have only awarded
Freden the overtime wages due to her.
The jury did not have the authority to award Freden money for the months
she was unemployed. (§ 1194, subd. (a).)
Thus, the damages award is erroneous and
must be reversed.
The
trial court, prior to rejecting Ozel’s motion for a judgment notwithstanding
the verdict, explained why it believed the $21,000 award was proper. The trial court stated that the overtime
issue was “so intertwined†with the sexual harassment issue that the two
“blended tremendously.†The trial court
conceded Freden’s sexual harassment claim was not viable, but still concluded
the overtime claim “intermingled†with the sexual harassment and wrongful
termination allegations. Thus, the trial
court reasoned there was a rational basis for the jury arriving at the $21,000
award for the overtime cause of action. The
trial court also denied Ozel’s motion for a new trial, because “there was some
rational basis for what [the jury] decided based on the evidence.â€
“‘A
motion for judgment notwithstanding the verdict may be granted only if it appears
from the evidence, viewed in the light most favorable to the party securing the
verdict, that there is no substantial evidence in support. [Citation.]
[¶] . . . As in the trial court,
the standard of review [on appeal] is whether any substantial evidence—contradicted
or uncontradicted—supports the jury’s conclusion.’ [Citation.]â€
(Cabral v. Ralphs Grocery Co.
(2011) 51 Cal.4th 764, 770.) There is
nothing in the record supporting overtime wages in the amount of $21,000. The trial court’s conclusion that the
evidence supported the $21,000 award is flawed because it relies on conflating sexual
harassment and wrongful termination damages with overtime wages. It appears the trial court deduced how the
jury might have combined causes of action to arrive at the $21,000 award, but
that does not mean the award is correct in light of the overtime law. (§ 1194, subd. (a).)
In
an overtime cause of action only the wages, interest, fees, and costs may be
awarded. Therefore, the trial court
needed to look at the evidence to determine whether it supported a finding of
$21,000 being due for overtime compensation.
Instead, the trial court determined that the $21,000 award could be
cobbled together from combining the successful overtime cause of action with
the unsuccessful sexual harassment and wrongful termination causes of action. When determining whether substantial evidence
supports a damages award, a trial court should not combine elements from
different causes of action, i.e. lost earnings from sexual harassment and
wrongful termination with overtime wages, to justify the jury’s award. Rather, the court should look at the evidence
to determine whether it supports the finding on the element at issue. In this case, there was not evidence of
$21,000 in overtime damages.
Accordingly, Ozel’s motion for judgment notwithstanding the verdict
should have been granted.
A
motion for new trial may be granted when excessive damages are awarded. (Code Civ. Proc., § 657.) “[An] appellate court ordinarily defers to the
trial court’s denial of a motion for new trial based on excessive damages,
because of the trial judge’s greater familiarity with the case. [Citations.]â€
(Rufo v. Simpson (2001) 86
Cal.App.4th 573, 614.) As explained
this case because the Labor Code only authorizes a plaintiff to collect (1) the
wages due, (2) interest due on the wages, (3) attorney’s fees, and (4) costs. The $21,000 finding by the jury was far in
excess of the $291 in damages associated with the overtime claim. Accordingly, the new trial motion should have
been granted.
Freden
argues, “[S]ubstantial evidence supports the logical inference that but for the
issue concerning overtime wages, Ozel would not have fired Ms. Freden, and she
would have remained employed there.
Thus, her economic damages were caused by the failure to pay overtime.†Freden’s argument is not persuasive because
the Labor Code does not permit a plaintiff to collect all damages that might
flow from a failure to pay overtime compensation. Rather, a plaintiff is entitled only to
wages, interest, costs, and fees. Thus,
Freden’s argument that the overtime issue led to a wrongful termination, does not
persuade us that she is entitled to lost earnings for a wrongful termination.
Next,
Freden asserts the $21,000 award is proper for the failure to pay overtime wages
because economic damages can be awarded for contractual causes of action. Freden again argues that she was fired
because Ozel did not want to pay her overtime wages, and therefore, her lost
earnings are consequential damages related to being fired for the overtime
issue. Whether framed as a tort or a
contract cause of action the Labor Code remains the same. A plaintiff suing for failure to pay overtime
wages may only collect (1) the wages due, (2) interest due on the wages, (3)
attorney’s fees, and (4) costs.
Presenting the excess damages as “consequential†contract damages does
not change the analysis that the statute does not authorize such damages for an
overtime compensation cause of action.
5. NEW
TRIAL
During
the trial it was unclear exactly how much money Freden was owed for overtime
wages. For example, Abraham Tekin, the
owner of Ozel, testified that he did not pay Freden for her overtime wages, but
also stated he did compensate for her overtime work with a pendant. Tekin’s son, who worked as an Ozel employee,
testified that he gave Freden a check in the amount of $1,600 for her overtime
wages. The check was written in
different color inks and had White Out on it.
Freden testified she had been given the $1,600 check, but was asked to
cash it for Tekin’s son, so she cashed the check but gave the money to Tekin’s
son. Freden explained she sometimes
cashed checks for Tekin’s son when they were the only two people working in the
jewelry store.
Given
the foregoing evidence, it is unclear exactly how much money Freden is owed for
her overtime wages, because there was not an easily calculable amount that was
discussed at the trial court.
Accordingly, this court cannot reduce the damage award because it is
unclear what amount of money is due to Freden.
Thus, a new trial must be had on the issue.
We
now examine the scope of the new trial.
“It is well settled that ‘[t]here is no constitutional impediment to a
retrial of a limited issue, so long as that issue is sufficiently distinct and
severable from the others that a limited retrial would not result in an
injustice.’ [Citations.]†(Barmas,
Inc. v. Superior Court (2001) 92 Cal.App.4th 372, 375.)
appears the damage issue is severable from the other issues at trial. While the trial court found it to be
intertwined with other causes of action, we disagree with the trial court’s
assessment. The overtime wage issue
requires evidence of the hours Freden worked and the amount of money she was
paid—it is not a matter that is intertwined with other causes of actions. Thus, we will order that a new trial be
conducted on the issue of damages alone, unless prior to the trial Freden
agrees to a reduction in the damage award that the trial court determines to be
fair and reasonable. (Code Civ. Proc., §
662.5, subd. (a)(2).)
B. WAIT TIME PENALTY
Ozel
contends the trial court erred by miscalculating the wait time penalty. Ozel asserts the wait time penalty should have
been $6,916.80—not $30,353.84. Freden
concedes the trial court miscalculated the wait time penalty and agrees to
reducing the amount to $6,916.80. Although
the parties agree to a particular sum, we will reverse the damages award in its
entirety. We do not rely on the parties’
calculation in this matter because it is unclear from the record exactly how
much money is due to Freden.
Section
203, subdivision (a), provides that if an employer fails to pay an employee’s
wages then the “the wages of the employee shall continue as a penalty from the
due date thereof at the same rate until paid or until an action therefor is
commenced; but the wages shall not continue for more than 30 days.â€
Ozel
terminated Freden’s employment on January 24, 2008. Freden filed her original complaint on April
25, 2008. Thus, the 30-day limit would
apply to the wait time penalty. Freden
earned $10 per hour plus commissions. The
parties agree Freden’s longest shifts lasted 11 hours and use the 11 hour
shifts as a basis for arriving at the sum of $6,916.80, e.g., $20.96 (highest
rate of pay) x 11 hours (longest shift) x 30 days. We find this problematic because one of
Freden’s time cards reflects she worked for 11.5 hours on two occasions. Tekin did not document Freden’s lunch breaks,
so it is unclear if a lunch break took place during the 11.5 hour shifts.
One
of the 11.5 hour shifts allegedly occurred on Christmas Eve. Tekin testified that Freden could not have
worked for 11.5 hours on Christmas Eve, as she claimed on her timecard, because
she claimed to have worked until 10:00 p.m., but the store closed at 6:00 p.m. Thus, it is unclear from the record exactly
how many hours comprised Freden’s longest shift. It is possible 11.5 hours was her longest
shift, but it is also possible the parties correctly agreed on 11 hours. Since we cannot be certain of how many hours
to use when calculating the wait time penalty, we will reverse this portion of
the award as well.
The
damages portion of the judgment is reversed.
The trial court is directed to hold a new trial on the issue of damages,
unless prior to trial Freden consents to a reduction of damages that the trial
court determines to be fair and reasonable.
(Code Civ. Proc., § 662.5, subd. (a)(2).) In all other respects, the judgment is
affirmed. Appellant is awarded its costs
on appeal.
NOT
TO BE PUBLISHED IN OFFICIAL REPORTS
MILLER
J.
We concur:
HOLLENHORST
Acting P. J.
CODRINGTON
J.
All subsequent statutory references will be to the Labor Code unless
otherwise indicated.
name="_ftn2" title=""> [2] Abraham Tekin, also a
defendant in the underlying case, did not file a brief at this court; and as he
was not aggrieved by the judgment this appeal is final as to him as well.
