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Epis v. Bradley CA1/4

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Epis v. Bradley CA1/4
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Filed 8/23/22 Epis v. Bradley CA1/4

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

FIRST APPELLATE DISTRICT

DIVISION FOUR

BARBARA EPIS,

Plaintiff and Appellant,

v.

KATHRYN GANT BRADLEY, as Executor, etc.,

Defendant and Respondent.

A160244

(Marin County Super. Ct.

No. CIV1001283)

Barbara Epis, a person of considerable wealth and sophistication in real estate investing, entered into a number of business and real estate transactions with her attorney, Vernon Bradley, and her accountant, Scott Jolley. When the trio’s business relationship fell apart, litigation followed. This appeal is the latest chapter in the saga.

After losing close to a million dollars on certain transactions, Epis sued Bradley and Jolley for breach of contract, intentional and negligent misrepresentation, breach of fiduciary duty, financial elder abuse, and violation of the unfair competition law (UCL) (Bus. & Prof. Code, § 17200 et seq.). Bradley cross-complained, asserting causes of action for, among other things, breach of contract (regarding a project known as the 96 Mt. Tiburon project or the Mt. Tiburon project), violation of the UCL, and declaratory relief. Most of the claims on both sides were tried to a jury, but the UCL and declaratory relief causes of action were tried to the court as equitable claims.

A bench trial on the equitable claims ended with entry of judgment for Bradley on his claim for declaratory relief as to title to a houseboat and on both UCL claims. Epis appealed the judgment, contesting the trial court’s findings but not the jury verdict. We reversed and remanded for reconsideration of certain issues. (Epis v. Jolley (Sept. 21, 2018, A143387) [nonpub. opn.] [2018 Cal.App.Unpub.LEXIS 6469, pp. *2, *19] (Epis I).) On remand, the trial court (Hon. Stephen Freccero) found in favor of Bradley on all remaining claims.[1]

Epis appeals the ensuing judgment. Specifically, Epis argues that the court erred by (1) ruling against her on her UCL cause of action against Bradley, (2) declining to consider on remand whether she has a right to void a purchase agreement under Probate Code section 16004, and (3) disregarding the law of the case set forth in our opinion in Epis I by awarding certain settlement funds held in trust to Bradley as the prevailing party on his claim for declaratory relief.

We reject each of these arguments and affirm the judgment.[2]

  • I. BACKGROUND

We summarize only the events relevant to the issues presented by the current appeal. “In brief, the parties invested together in a series of real estate transactions in Marin County. Through shrewd real estate dealings over the course of 30 years, Epis had amassed a fortune of some $22 million. Bradley and Jolley used her as a ‘deep pocket’ investor in properties they planned to renovate and sell at a profit. Epis provided the cash required for down payments and certain other financial needs during development; Bradley managed the renovation and development of the properties they purchased; Jolley provided credit financing and funds for debt service and remodeling. It appears Jolley and Bradley also handled accounting and legal issues that arose.” (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, pp. *2–*3].)

Epis eventually sued both Jolley and Bradley on sundry contract, business tort, and statutory claims, and Jolley and Bradley brought counterclaims of the same genre. The case was assigned to Judge Mark Talamantes. At trial Epis took the position that the funds she provided were loans, but there was substantial evidence supporting the trial court’s finding that Epis was a joint venturer with Bradley and Jolley. At some point the arrangement foundered and money was lost. Then, as the trial court put it, the “ ‘former friends . . . turned on each other.’ ” (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, p. *3].)

Among the transactions out of which the parties’ claims and counterclaims arose was the one called the Mt. Tiburon project. The evidence surrounding that project, briefly summarized, was as follows.

  1. The Mt. Tiburon Project

In early 2008, Bradley approached Epis with an investment opportunity to develop an empty lot with a hilltop view located at 96 Mt. Tiburon (Mt. Tiburon). Like in past deals, Epis would provide an initial down payment and financing for the project in exchange for a percentage of ownership. Bradley would oversee construction.

In January 2008, Epis and Bradley entered a contract to acquire the right to purchase the lot and build a house on it. Bruce Portner, one of the owners of the limited liability company (LLC) that held title, testified he read the purchase agreement to Epis three times and asked if she understood the agreement before she signed. He also testified Epis acknowledged she understood the agreement but wanted to negotiate a little more interest from Bradley. All the parties signed the purchase agreement. Epis and Bradley also signed a separate proposed business plan. Collectively, the agreements called for Epis to pay $259,932.06 in exchange for 50 percent ownership of the LLC that held title to the land. She was also required among other things to make monthly interest payments of $12,187.50 and to obtain a construction loan to finance the project within one year.

The proposed business plan contained the following attorney conflict waiver: “Vernon Bradley has represented Barbara Epis as an attorney and may continue to represent Barbara Epis in the future. If there is any conflict presented by this contract, Barbara will waive any conflict or claim of undue influence because of Vernon Bradley’s role as her existing and prior attorney.” The purchase agreement did not contain an attorney conflict disclosure.

Epis wrote a check to the LLC for the down payment postdated to February 19, 2008. The check was deposited on January 22, 2008. Soon after, Epis failed to make her first interest payment on February 1, 2008. Bradley found another investor, Alton Lomas, to advance funds towards the project on behalf of Epis in the short term because she was experiencing cash flow problems.

It appears Epis made no further payments towards the project and did not obtain a construction loan. The Mt. Tiburon project was ultimately abandoned when Bradley ran out of money to finish construction. According to the testimony of Bradley and Lomas, they were unable to obtain a construction loan or other financing due to the chaotic lending climate at the time and Epis’s unwillingness to cooperate. The partially developed lot was subsequently foreclosed.

At trial, Epis argued the down payment was intended only as a temporary loan until Bradley found another investor to replace her, but there was substantial evidence that Epis was a joint investor with Bradley in the Mt. Tiburon deal as in previous ventures.

  1. Proceedings in the Trial Court

A two-week jury trial resulted in findings in favor of Bradley on Epis’s claims for negligent and intentional misrepresentation and financial elder abuse. The jury found Bradley had breached his fiduciary duty to Epis and violated former Rule 3‑300 of the Rules of Professional Conduct[3] (former Rule 3‑300),[4] but the jury found Epis was not harmed. The jury awarded Bradley $185,385.74 in damages on his cross-complaint for Epis’s breach of contract on the Mt. Tiburon deal. In a special verdict, the jury found that Bradley performed all, or substantially all, of his obligations under the Mt. Tiburon contract and that Epis had failed to do something that was required by the contract.

The equitable issues, including the UCL claims and request for declaratory relief, were then tried to the court. The court ruled in Bradley’s favor on all causes of action. Although the jury found Bradley had violated former Rule 3‑300, the court concluded a rules violation could not serve as the basis for a UCL claim. The court also found that Bradley was the legal and beneficial owner of the disputed houseboat.

Epis pursued an appeal challenging only the results of the bench trial, not the jury verdict. In the opinion resolving that appeal, we vacated the judgment and remanded to the trial court for reconsideration of specific issues. (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, pp. *2, *19].) We instructed the trial court to reconsider the evidence on Epis’s UCL claim (the fifth cause of action in her complaint) and determine as a factual matter (1) whether Bradley’s violation of former Rule 3‑300 amounted to an unlawful, unfair, or fraudulent practice under the UCL; and if so, (2) whether there was a causal connection between Bradley’s ethics violation and Epis’s financial losses. (Epis I, supra, A143387 [2018 Cal.App.Unpub. LEXIS 6469, pp. *8–*10].) As to Bradley’s claim for declaratory relief (the fifth cause of action in his cross-complaint), we held the trial court applied the wrong standard of proof in determining title to the houseboat. (Id. at p. *2.) We instructed the trial court to determine whether Bradley had rebutted, by clear and convincing evidence, the presumption of equitable ownership arising from Epis’s legal title to the houseboat. (Id. at pp. *16–*17.)

On remand, after Epis disqualified Judge Talamantes under Code of Civil Procedure section 170.6, the matter was reassigned to Judge Freccero. The parties agreed that evidence would not be reopened on remand.

Judge Freccero issued a judgment on remand and a statement of decision in February 2020. He concluded Bradley’s violation of the Rules of Professional Conduct did constitute an unfair and unlawful practice under the UCL, but that Epis did not suffer “injury in fact” and had failed to prove that she “lost money or property as a result” of the violation regarding the Mt. Tiburon contract. (See Bus. & Prof. Code, § 17204.) Separately, after applying the correct standard of proof, the court declared that Bradley was the owner of the houseboat and that his estate is entitled to $50,000 in settlement funds that are being held in trust following a foreclosure of the houseboat and a settlement with the foreclosing lender.

Epis now appeals the February 14, 2020 judgment.

  • II. DISCUSSION
  1. Epis’s UCL Claim

Epis contends the trial court erred in concluding she failed to show the requisite injury in fact and causation for her UCL claim concerning the Mt. Tiburon project. She claims she is entitled to restitution for the full amount of the down payment she made toward the project in 2008 under Business and Professions Code section 17203 as a remedy for Bradley’s UCL violation. She also claims a right to bar Bradley’s recovery of a jury award for breach of contract arising from the same transaction.

Business and Professions Code section 17200 defines unfair competition as “any unlawful, unfair or fraudulent business act or practice.” An action under the UCL may be brought by a private “person who has suffered injury in fact and has lost money or property as a result of” conduct that fits one of the categories of “unfair competition.” (Bus. & Prof. Code, § 17204.)

At trial (prior to the first appeal in this case), the jury found Bradley had violated the ethical rules governing attorneys by failing to fully disclose conflicts of interest resulting from his business investments with Epis and failing to secure adequate signed waivers of those potential conflicts as required by former Rule 3‑300. The trial court then concluded as a matter of law that an attorney’s rules violation could not serve as the basis for a UCL claim, and the court thus did not reach the issues of injury in fact or causation.

In Epis’s first appeal, we held an attorney’s rules violation can serve as the basis for a UCL claim. (Epis I, supra, A143387 [2018 Cal.App.Unpub. LEXIS 6469, pp. *7–*8].) We remanded to the trial court with instructions to reconsider the evidence supporting Epis’s UCL claim, and to determine (1) whether Bradley’s violation of the Rules of Professional Conduct constituted a violation of the UCL, and, if so, (2) whether Epis had proven that she suffered injury in fact and had lost money or property as a result of the UCL violation as required for UCL standing under Business and Professions Code section 17204. (Epis I, supra, A143387 [2018 Cal.App. Unpub.LEXIS 6469, pp. *9–*10].)

On remand, Epis had the burden of showing a causal connection between Bradley’s rules violation and her financial losses. In her brief in the trial court on remand, she invoked two prongs of the UCL, arguing Bradley’s failure to comply with former Rule 3‑300 constituted an “unlawful” and “unfair” practice that caused her to lose money by inducing her to participate in the Mt. Tiburon project. Epis argued that Bradley’s “wrongful acquisition” from her of the down payment at the outset was sufficient to satisfy both injury in fact and causation under the UCL. In her brief on remand, Epis claimed that “t is easily inferred that Epis did not want to participate in the deal” and that Epis was “somehow snookered” by Bradley.

The trial court was unpersuaded by this argument. The court found that Bradley had violated the UCL, but that Epis suffered no loss of money or property as a result. In its statement of decision, the trial court noted that its finding was consistent with the jury’s finding in the special verdict that Bradley breached his fiduciary duty to Epis as her attorney in various transactions, including the Mt. Tiburon deal, but that she was not financially harmed by the breach.

In her second appeal, Epis disputes the trial court’s finding on causation. Her opening appellate brief argues for the first time that so long as Bradley’s unethical conduct was a contributing factor in her agreeing to invest $259,932.06—even if not a predominant or decisive factor—then she lost money as a result of his UCL violation as “a matter of law.” She contends Bradley’s conduct was a contributing factor because, but for his rules violation, her money would not have been exposed to a general housing market crash, which she acknowledges ultimately caused the loss of her investment. Put simply, her argument is that causation is established per se once a UCL violation has been proven. We disagree.

It is well settled that causation is ordinarily a question of fact. ([i]Novak v. Continental Tire North America (2018) 22 Cal.App.5th 189, 197.) Whether Bradley’s failure to comply with former Rule 3‑300 induced Epis into entering a transaction that she would not have otherwise entered is a factual matter that was properly considered and implicitly rejected by the trial court when it determined she failed to establish causation. We conclude the trial court’s decision is supported by the evidence, and we are unpersuaded by Epis’s attempt to reframe causation as a legal issue.

We apply a substantial evidence standard of review to the trial court’s findings of fact. (Thompson v. Asimos (2016) 6 Cal.App.5th 970, 981.) Under this deferential standard of review, findings of fact are liberally construed to support the judgment and we consider the evidence in the light most favorable to the prevailing party, drawing all reasonable inferences in support of the findings. (Ibid.) The testimony of a single witness may constitute evidence to support a finding. (Ibid.) “ ‘A judgment or order of a lower court is presumed to be correct on appeal, and all intendments and presumptions are indulged in favor of its correctness.’ ” (Ibid.) “ ‘[U]nder the doctrine of implied findings, the reviewing court must infer, following a bench trial, that the trial court impliedly made every factual finding necessary to support its decision.’ ” (Ibid.)

We conclude substantial evidence supports the trial court’s implied finding that Epis would have agreed to participate in the Mt. Tiburon project when Bradley first approached her with the opportunity in early 2008 even if Bradley had informed her in writing of her right to seek independent counsel and obtained an adequate conflict waiver as required by former Rule 3‑300.

The trial court found Epis relied on Bradley’s advice when making investment decisions and Bradley put his own financial interests before the interests of his client. The court, however, also described Epis as a sophisticated and very successful real estate developer, landlord and property owner who had amassed property holdings totaling over $22,000,000. Epis testified that she purchased her first investment property in 1968. Less than two years before she entered the Mt. Tiburon deal, she owned 16 rental properties around the Bay Area, evidenced by a loan application from May 2006. In the same application, Epis indicated she had been self-employed as a partner and property manager for a real estate investment firm for 37 years. Given her extensive transactional experience in real estate, it was reasonable for the trial court to infer that she was aware of her right to seek independent counsel and would have exercised her own judgment before deciding to invest.

In addition, Epis testified that Bradley was her attorney from around 2001 to 2008. In our first opinion, we found substantial evidence supported the trial court’s finding that Bradley and Epis were joint venturers who worked closely together as business partners to purchase and develop real estate. (Epis I, supra, A143387 [2018 Cal.App. Unpub.LEXIS 6469, p. *3].) According to Bradley’s testimony at trial, in some deals, Epis would loan him money in exchange for a note and deed of trust. In others, she would make a down payment and provide funding throughout the project in exchange for an equity share. Bradley testified that Epis earned significant profits from their previous joint ventures. Based on their past dealings and her active role in their joint ventures, the trial court could have reasonably inferred that Epis would have agreed to invest in the Mt. Tiburon project in the anticipation she would profit when the project was completed.

At trial, Epis and Bradley took opposite positions as to the enforceability of the Mt. Tiburon contract. Bradley argued they entered into a valid contract which Epis breached. In contrast, Epis testified her signature was forged on the purchase agreement and a subsequent modification agreement. The jury plainly resolved that credibility dispute against Epis, finding there was a valid contract and that Epis breached it. On appeal, Epis argues she was induced into turning over a check for the down payment and signing the Mt. Tiburon agreements because she relied on one or more misrepresentations by Bradley.

Again, the jury disagreed with her. In its special verdict, the jury found that Bradley did not make any false representations of important facts to Epis. The trial judge also made an adverse credibility finding against Epis. In support of his finding in favor of Bradley as to his claim for declaratory relief, Judge Talamantes stated in his statement of decision that “[j]ust as the jury did not believe her arguments during trial, this court finds her testimony lacks credibility.” It was appropriate for Judge Freccero, too, on remand, to decline to credit Epis’s factual assertions about the Mt. Tiburon transaction. We must defer to the trial court’s credibility assessment.

Our review of the record leaves no doubt that Judge Freccero carefully considered Epis’s various causation arguments and was unpersuaded by them. On appeal, Epis’s reiteration of her version of events does not persuade us there is a lack of substantial evidence supporting Judge Freccero’s decision. At oral argument, counsel for Epis argued the rules violation caused Epis to sign the papers for the Tiburon project and his conduct in doing so qualifies as both a “but for” cause and a “substantial factor” causing her loss of money on the deal. As we read the record, however, the trial court impliedly found that Bradley’s breach of former Rule 3‑300 was neither a “but for” cause nor a “substantial factor” cause of Epis’s loss. The record evidence supports that implied finding.

We conclude substantial evidence supports the trial court’s implied finding on remand that Epis would have suffered the same harm whether or not Bradley had complied with former Rule 3‑300, and thus failed to establish causation.

  1. Judge Freccero Properly Declined To Consider Epis’s Probate Code Section 16004 Claim on Remand

Epis contends the trial court erred by declining to consider on remand whether she has a right to void the Mt. Tiburon contract under Probate Code section 16004 as part of her UCL claim. In her brief on remand, Epis claimed the entire judgment was vacated on appeal, including the jury verdict. With the entire judgment vacated, Epis argued she was entitled to void the contract at issue in the Mt. Tiburon project, and bar recovery of the jury award as a remedy for Bradley’s UCL violation. Judge Freccero declined to consider this claim, reasoning that it fell outside the scope of remand set forth in our Epis I opinion. Although the original judgment was vacated on appeal, Judge Freccero properly concluded that our Epis I opinion left the jury verdict intact and directed the trial court to address only specific issues on remand. In his statement of decision, Judge Freccero explained that he was only authorized to consider issues relevant to determining (1) Epis’s UCL claim and (2) Bradley’s quiet title claim.

An appellate court may limit or define the issues to be addressed on remand. (Rincon EV Realty LLC v. CP III Rincon Towers, Inc. (2019) 43 Cal.App.5th 988, 1001.) Based on his reading of the dispositional language in our Epis I opinion, Judge Freccero concluded that he lacked jurisdiction to address Epis’s claim seeking to void the Mt. Tiburon contract under Probate Code section 16004. “Whether the trial court correctly interpreted our opinion is an issue of law subject to de novo review. [Citations.] [¶] Our remittitur directions are contained in the dispositional language of our previous opinion. [Citation.] The trial court’s interpretation of those directions is not binding on us. [Citation.] We look to the wording of our directions to determine whether the trial court’s order comports with them. [Citation.] When, as in this case, the reviewing court remands the matter for further proceedings, its directions must be read in conjunction with the opinion as a whole.” (Ayyad v. Sprint Spectrum, L.P. (2012) 210 Cal.App.4th 851, 859.)

To support her contention that Judge Freccero should have considered the Probate Code section 16004 issue, Epis points to language in our prior opinion summarizing the background of her UCL cause of action. There, we listed four transactions, including, “(2) a contract to purchase a property located at 96 Mt. Tiburon, as to which the jury awarded Bradley $185,385.74, and Epis contends she is entitled to void the contract and thereby bar his recovery of the jury’s verdict.” (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, p. *5].) By referencing her claimed right to void the Mt. Tiburon contract as one of the transactions at issue under her UCL cause of action, Epis argues that we authorized the trial court to consider the Probate Code section 16004 issue on remand. We disagree.

The portion of our Epis I opinion she refers to is only a summary of the various transactions potentially at issue as briefed by the parties in the first appeal to provide context for our legal analysis. (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, p. *5].) Later in our opinion, we clearly outlined the scope of remand as to Epis’s UCL claim. Our remand directions authorized the trial court to reconsider whether Bradley’s former Rule 3‑300 violation amounted to an unlawful, unfair or fraudulent practice under the UCL, and whether Epis had suffered injury in fact and a loss of money or property as a result; they did not authorize the trial court to consider other statutory remedies potentially available for violations of former Rule 3‑300. (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, pp. *8–*10].)

The precise origin of Epis’s Probate Code section 16004 claim and its relationship to her UCL claim is unclear from the record. Probate Code section 16004 is a statutory complement to former Rule 3‑300 that establishes a rebuttable presumption that transactions between an attorney and client by which the attorney obtains an advantage are a breach of the attorney’s fiduciary duty and are the product of undue influence. (Prob. Code, § 16004, subd. (c); Ferguson v. Yaspan (2014) 233 Cal.App.4th 676, 684–685.) But Epis fails to explain how this independent basis of liability for an attorney’s rules violation relates to her UCL claim. In her opening brief in the present appeal, she appears to argue that because a violation of former Rule 3‑300 can serve as the basis for a claim under both statutes, they are necessarily related.

We are not persuaded. To bolster her argument, Epis cites Ferguson v. Yaspan, supra, 233 Cal.App.4th 676. The plaintiffs in Ferguson sought to set aside an agreement to sell an interest in their London flat to their attorney, claiming the agreement was the product of undue influence under Probate Code section 16004 because the attorney had failed to fully comply with former Rule 3‑300. (Ferguson, supra, at pp. 684–685.) But Ferguson does not aid her argument because the plaintiffs in that case did not allege a UCL cause of action.

Epis chose to assert a claim under the UCL, premised on a violation of former Rule 3‑300. She did not plead a violation of Probate Code section 16004. By declining to consider a claim that has no bearing on the merits of Epis’s UCL cause of action, Judge Freccero did no more than comply with our remand directions, and thus did not err.

  1. Judge Freccero Did Not Disregard the Law of the Case

Epis contends Judge Freccero, by quieting title to the houseboat in favor of Bradley and awarding his estate a $50,000 settlement held in trust, misinterpreted or disregarded the law of the case as established by our Epis I opinion. We disagree.

“ ‘A reviewing court has authority to “affirm, reverse, or modify any judgment or order appealed from, and may direct the proper judgment or order to be entered, or direct a new trial or further proceedings to be had.” (Code Civ. Proc., § 43.) The order of the reviewing court is contained in its remittitur, which defines the scope of the jurisdiction of the court to which the matter is returned.’ [Citations.] ‘The trial court is empowered to act only in accordance with the direction of the reviewing court; action which does not conform to those directions is void.’ ” (Ayyad v. Sprint Spectrum, L.P., supra, 210 Cal.App.4th at p. 859.)

A trial court on remand must comply with the law of the case. (Rincon EV Realty LLC v. CP III Rincon Towers, Inc., supra, 43 Cal.App.5th at p. 997.) “ ‘ “The doctrine of ‘law of the case’ deals with the effect of the first appellate decision on the subsequent retrial or appeal: The decision of an appellate court, stating a rule of law necessary to the decision of the case, conclusively establishes that rule and makes it determinative of the rights of the same parties in any subsequent retrial or appeal in the same case.” ’ ” (Leider v. Lewis (2017) 2 Cal.5th 1121, 1127.)

In the first trial, Judge Talamantes found Bradley was the beneficial owner of the houseboat but applied the wrong standard of proof and made no finding as to whether Bradley had paid off or assumed any outstanding loans on the houseboat. In the first appeal, Epis claimed Bradley should only have been awarded title subject to existing loans and other offsets owed to her. (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, pp. *17–*18].) We remanded for the trial court to apply the correct standard of proof. (Id. at pp. *18–*19.) And, if the court found Bradley was the beneficial owner again, we instructed the court to determine whether Bradley owed Epis any money or should have to assume any loans. (Ibid.)

At the time of the first trial, the outstanding loans on the houseboat totaled approximately $588,000. The houseboat was subsequently foreclosed and repossessed. By the time the matter reached Judge Freccero on remand, there were no outstanding loans to assume and no houseboat for which to quiet title. The parties nonetheless asked Judge Freccero to declare ownership of the houseboat because the prevailing party would be entitled to $50,000 held in trust pursuant to a settlement agreement from a collateral lawsuit. After applying the correct standard of proof, the trial court found Bradley had rebutted, by clear and convincing evidence, the presumption that Epis was the owner of the houseboat.

Adhering closely to our disposition of the first appeal, Judge Freccero turned next to the issue of whether Bradley should have to reimburse Epis for the down payment, mortgage installments or other payments she claimed to have made on his behalf. He found Bradley’s testimony that Epis was repaid in full when escrow on the houseboat closed more credible than Epis’s testimony that she was not repaid. On that basis, Judge Freccero concluded Bradley’s estate owes no further reimbursement to Epis for the down payment. Judge Freccero also found Bradley owed nothing as far as monthly mortgage payments because Epis did not present any evidence showing the amounts owed and waived her right to present additional evidence by agreeing not to reopen evidence on remand. In his statement of decision, Judge Freccero acknowledged that a judgment in favor of Bradley on his quiet title claim would necessitate a pay-off if there were any remaining loans or payments due. But having determined that all remaining loans had been extinguished by the foreclosure, the down payment repaid, and no offsets owed to Epis, Judge Freccero concluded that a pay-off was not possible. Accordingly, he declared Bradley the owner of the houseboat and his estate entitled to the remaining $50,000 held in trust.

On appeal, Epis does not challenge Judge Freccero’s finding that Bradley was the beneficial owner of the houseboat. Nor does she directly dispute the court’s finding that Bradley’s estate owes her no further reimbursement for the down payment or any other offsets as a result of the foreclosure or monthly mortgage payments. Her only contention is that by awarding the $50,000 held in trust to Bradley’s estate, Judge Freccero disregarded “the Appellate Court’s directive that there should be a ‘quid for the pro quo.’ ”

To support her claim, Epis points to a portion of our opinion that states, “Since Bradley was awarded title to the houseboat, he also should have been burdened with repaying the outstanding balance of any loans taken out to purchase or improve the floating home, or any such loans that inured to Bradley’s benefit rather than Epis’s. Assuming the trial court adheres to its finding on the title transfer point after applying the correct standard of proof—an issue on which we again emphasize we intimate no view—the logic of the transaction Bradley argues took place appears to carry a quid for the pro quo.” (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, p. *18].) Here, Epis contends the trial court was only authorized to quiet title in Bradley’s favor conditional upon her receiving something in return. We disagree.

The language of the Epis I disposition and opinion read as a whole establishes Judge Freccero did not disregard the law of the case and acted within the permitted scope of jurisdiction on remand. In Epis I, we stated in the disposition: “The judgment is vacated and the matter is remanded for further proceedings in accordance with this opinion.” (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, p. *19].) In the paragraph immediately preceding our disposition, we stated: “Upon remand, if the court again declares Bradley to be the owner of the houseboat, the court shall take evidence and argument as needed to determine the amount (if any) Bradley’s estate should be required to pay to Epis, given that (1) Epis paid the down payment and several monthly payments, and (2) the houseboat has since been foreclosed upon.” (Id. at pp. *18–*19, italics added, fns. omitted.) Our directions on remand permitted the trial court to take the steps necessary to determine the amount owed by Bradley’s estate “if any.” By including the qualifying phrase “if any,” we anticipated the possibility that Bradley’s estate would owe nothing to Epis after a final accounting. Thus the trial court had authority to quiet title in favor of Bradley without a pay-off to Epis.

  • III. DISPOSITION

Affirmed. Costs on appeal to respondent.

STREETER, J.

WE CONCUR:

POLLAK, P. J.

BROWN, J.


[1] Vernon Bradley died on May 21, 2015, during the pendency of the prior appeal in this matter. (Epis I, supra, A143387 [2018 Cal.App.Unpub. LEXIS 6469, p. *19, fn. 9].) It appears no formal motion for substitution of parties was filed as required by California Rules of Court, rule 8.36(a), but in the prior appeal an attorney representing Kathryn Gant Bradley, the executor of Bradley’s estate, filed a notice of intent to file (and then did file) a respondent’s brief, and attorneys representing the executor have likewise filed a respondent’s brief in the present appeal, all without any objection by any other party. Although we expect parties to follow the rules governing substitution of parties, there has been no objection to the appearance of Bradley’s estate in this appeal, so we will in this case deem Kathryn Gant Bradley, as executor of Bradley’s estate, to have substituted as a defendant and respondent in place of Vernon Bradley.

Separately, the other defendant and respondent, Scott Jolley, was dismissed as a party to this appeal on September 3, 2021.

[2] We grant Epis’s unopposed request for judicial notice filed on October 18, 2021, pertaining to a complaint filed in related litigation.

[3] References to rules are to the Rules of Professional Conduct.

[4] The Rules of Professional Conduct have been renumbered subsequent to the original trial proceedings and the first appeal. The current rule that is analogous to former Rule 3‑300 is Rule 1.8.1. Former Rule 3‑300 provided as follows:

“A member shall not enter into a business transaction with a client; or knowingly acquire an ownership, possessory, security, or other pecuniary interest adverse to a client, unless each of the following requirements has been satisfied:

“(A) The transaction or acquisition and its terms are fair and reasonable to the client and are fully disclosed and transmitted in writing to the client in a manner which should reasonably have been understood by the client; and

“(B) The client is advised in writing that the client may seek the advice of an independent lawyer of the client’s choice and is given a reasonable opportunity to seek that advice; and

“(C) The client thereafter consents in writing to the terms of the transaction or the terms of the acquisition.”





Description “In brief, the parties invested together in a series of real estate transactions in Marin County. Through shrewd real estate dealings over the course of 30 years, Epis had amassed a fortune of some $22 million. Bradley and Jolley used her as a ‘deep pocket’ investor in properties they planned to renovate and sell at a profit. Epis provided the cash required for down payments and certain other financial needs during development; Bradley managed the renovation and development of the properties they purchased; Jolley provided credit financing and funds for debt service and remodeling. It appears Jolley and Bradley also handled accounting and legal issues that arose.” (Epis I, supra, A143387 [2018 Cal.App.Unpub.LEXIS 6469, pp. *2–*3].)
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