Filed 7/16/13 Bates v. Chicago Title Co. CA4/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

ROBERT F. BATES, as Trustee, etc., D059205

Cross-complainant and Appellant,

v. (Super. Ct. No. 37-2009-00101454-CU-OR-CTL)

CHICAGO TITLE COMPANY,

Cross-defendant and Appellant.

APPEALS from a judgment and order of the Superior Court of San Diego County,

Ronald L. Styn, Judge. Judgment reversed and remanded; cross-appeal dismissed.

Coughlin Law Firm and Sean C. Coughlin for Cross-Complainant and Appellant.

Fidelity National Law Group, Tao Y. Leung, Christopher D. Greinke and Jacky P.

Wang for Cross-defendant and Appellant.

Cross-complainant Robert F. Bates, trustee of the Robert F. Bates Family Trust

dated 11-29-90 (Bates) appeals a judgment after the trial court granted the motion for

summary judgment filed by cross-defendant Chicago Title Company (CT) in his

negligence cross-action against it. Bates alleges CT was negligent in preparing a deed of trust to replace one he had previously reconveyed. On appeal, Bates contends the trial

court erred by concluding CT did not owe him a legal duty of due care in preparing the

replacement trust deed. Because we conclude there are triable issues of material fact

regarding whether CT undertook to, and did, prepare the trust deed and the nature and

extent of any concomitant undertaking, we conclude the trial court erred by granting CT's

motion for summary judgment.

CT filed a cross-appeal contending the trial court erred by denying its motion for

leave to augment its expert witness list or, in the alternative, leave to submit tardy expert

witness information. Because that order is nonappealable, we dismiss the cross-appeal.

FACTUAL AND PROCEDURAL BACKGROUND

On September 17, 2002, Raytheon Development, Inc. (Raytheon), by its president,

Kevin A. Tucker, executed as trustor a deed of trust (2002 Trust Deed) encumbering

certain property it owned at 3655 Ruffin Road in San Diego (Property) to secure a

$450,000 promissory note (Note) it made payable to Bates, the beneficiary of the 2002

Trust Deed. On September 20, the 2002 Trust Deed was recorded in the San Diego

County Recorder's Office.

On October 25, 2002, Raytheon, by its president (Tucker), executed a grant deed

(Grant Deed) conveying its ownership interest in the Property to Ruffin Road Venture

Lot 3, a Nevada corporation (RRV3). On November 13, the Grant Deed was recorded in

the San Diego County Recorder's Office. Bates and his son, Robert L. Bates, apparently

were unaware of the Grant Deed transferring ownership of the Property at that time. At

2 some point during 2002, Bates retired and his son, Robert L. Bates, assumed most of his

duties related to servicing of the loan evidenced by the Note.

In November or December 2003, San Diego County Credit Union (SDCCU) and

RRV3 (apparently by Tucker, its president) opened an escrow with CT, as escrow holder,

for a $1,600,000 loan to be made by SDCCU to RRV3 secured with a deed of trust

encumbering the Property. Renee Marshall, an escrow officer with CT, handled the

escrow. CT was also the title insurer in the loan transaction. The SDCCU loan escrow

apparently could not close unless Bates reconveyed or subordinated the 2002 Trust Deed

so the SDCCU deed of trust would be first in priority. On or about March 18, 2004, CT

sent Bates a request for demand and full reconveyance, a beneficiary's demand, and

substitution of trustee and a full reconveyance of the 2002 Trust Deed. Tucker

purportedly requested that Bates and CT agree that if Bates reconveyed the 2002 Trust

Deed, then Tucker would execute a replacement trust deed after the SDCCU loan escrow

closed.1 Bates purportedly would not execute the reconveyance of the 2002 Trust Deed

and submit a beneficiary demand for $0 unless CT assured him that a replacement deed

of trust would be prepared, executed, and notarized. In a telephone conversation with

Robert L. Bates, Marshall purportedly confirmed CT would prepare a replacement deed

of trust and ensure that it was executed and notarized. On or about March 24, Bates

executed and delivered to CT a substitution of trustee and full reconveyance of the 2002

1 This and other factual assertions were set forth in the declaration of Robert L. Bates in opposition to CT's motion for summary judgment.

3 Trust Deed and a beneficiary's demand for $0. On April 9, apparently about the time the

SDCCU loan escrow closed, the substitution of trustee and full reconveyance of the 2002

Trust Deed was recorded in the San Diego County Recorder's Office. Also on April 9, a

deed of trust executed by RRV3, by its president (Tucker), encumbering the Property as

security for the $1,600,000 loan made by SDCCU, its beneficiary, was recorded in the

San Diego County Recorder's Office.2

On April 23, 2004, trustor Raytheon, by its president, Tucker, executed a deed of

trust (2004 Trust Deed) encumbering the Property to secure the 2002 Note in the amount

of $450,000 it made to Bates, the beneficiary of the 2004 Trust Deed.3 Marshall

notarized Tucker's signature on the 2004 Trust Deed. Tucker apparently delivered the

executed 2004 Trust Deed to Robert L. Bates, who later had it recorded in the San Diego

County Recorder's Office on May 17, 2004.

In December 2007, The Alliance Portfolio, a California corporation (Alliance),

apparently made a $600,000 loan to RRV3 secured by a deed of trust executed by trustor

RRV3, by its president (Tucker), encumbering the Property. In June 2009, with the 2002

Note apparently in default, Bates recorded a notice of default under the 2004 Trust Deed.

2 Although the first page of the deed of trust named RRV3 as the trustor, its signature page listed both RRV3 and Raytheon as trustors. Furthermore, Tucker signed the deed of trust twice on signature lines for the president and secretary of Raytheon, not RRV3. In deciding this appeal, we do not address the effect of that inconsistency and apparent mistake.

3 The 2004 Trust Deed stated it was "made September 16, 2002" (the date of the 2002 Trust Deed), yet it was executed by Tucker on April 23, 2004.

4 In November 2009, Alliance and other plaintiffs filed a complaint against Bates,

Raytheon, and RRV3 alleging causes of action for quiet title, injunctive relief, slander of

title, declaratory relief, and cancellation of instrument and damages. The complaint

alleged that at the time Raytheon executed the 2004 Trust Deed it did not have any right,

title, or interest in and to the Property and therefore the 2004 Trust Deed was invalid and

did not create a lien against the Property. The complaint sought relief enjoining the

foreclosure sale of the Property by Bates and declaring the 2004 Trust Deed void.

Bates filed a cross-complaint against CT, Alliance, Raytheon, RRV3 and others,

alleging causes of action for declaratory relief, negligence, indemnity, and contribution.

In his negligence cause of action against CT, Bates alleged:

"28. While the above-described SDCCU Escrow was pending, as described above, [CT] agreed to act on behalf of [Bates] to properly consummate the above-described reconveyance and re-recording transaction. In doing so, [CT] owed a duty of care to [Bates] to properly handle the reconveyance and re-recording transaction.

"29. . . . [CT] acted negligently, in that in assisting [Bates] with the reconveyance and re-recording transaction, and in preparing the [2002 Trust Deed] to be re-executed and re-recorded, [CT] failed to take the care necessary and required of an escrow company in the same or similar role to prevent exposure to [Bates] to the types of claims and allegations contained in the Complaint filed by [Alliance].

"30. [Bates] relied on the services of [CT] in that [CT] acted as the escrow agent for the SDCCU transaction, knew that the obligation underlying the [2002 Trust Deed] was not paid through the SDCCU transaction or otherwise, and assented to assist [Bates] with the reconveyance and re-recording transaction."

5 CT filed a demurrer to the cross-complaint. The trial court sustained the demurrer as to

the declaratory relief, indemnity, and contribution causes of action and overruled the

demurrer as to the negligence cause of action.

CT then filed a motion for summary judgment on Bates's negligence cause of

action, arguing it did not agree to properly consummate the re-recording transaction and

therefore did not owe Bates any duty of care. CT also argued that even if it agreed to,

and did, prepare the 2004 Trust Deed, Bates did not instruct it to verify that Raytheon

was the record title holder of the Property when the 2004 Trust Deed was prepared, did

not order a preliminary title report, and did not ask it to insure the priority of the 2004

Trust Deed or otherwise guarantee the vesting of the 2004 Trust Deed. In support of its

motion, CT submitted a separate statement of undisputed material facts, Marshall's

declaration, and an appendix of evidence. CT also filed a motion for leave to augment its

expert witness list and declaration or, in the alternative, leave to submit tardy expert

witness information.

Bates opposed CT's motion for summary judgment, arguing there are triable issues

of material fact that precluded summary judgment. He argued CT agreed to, and did,

prepare a deed of trust to replace the 2002 Trust Deed and negligently prepared the 2004

Trust Deed by mistakenly listing the wrong trustor on it. He further argued CT owed him

a duty to correctly prepare the 2004 Trust Deed and knew, based on its handling of the

SDCCU escrow, who the correct trustor was (i.e., RRV3 and not Raytheon). In support

of his opposition, Bates submitted a separate statement of undisputed material facts, a

declaration of Robert L. Bates, and a lodgment of exhibits. Bates also opposed CT's

6 motion for leave to augment its expert witness list and declaration or, in the alternative,

leave to submit tardy expert witness information.

CT filed a reply in support of its motion for summary judgment. It argued that it

fully complied with the SDCCU escrow instructions. It argued the undisputed facts

showed a replacement trust deed was prepared because the 2004 Trust Deed contained

material terms identical to those in the 2002 Trust Deed. Because the 2004 Trust Deed

identified the same trustor, the same property, and same beneficiary as in the 2002 Trust

Deed, CT argued it was a "replacement" trust deed. CT also argued it was not instructed

by Bates, either expressly or implicitly, to search the title for the Property or otherwise

verify the vesting information for the 2004 Trust Deed. Furthermore, it argued it would

be unreasonable to expect Marshall to know or recall the proper vesting for the 2004

Trust Deed based on her handling of the SDCCU escrow.

On December 23, 2010, the trial court denied CT's motion for leave to augment its

expert witness list. The court granted CT's motion for summary judgment. On January

20, 2011, the court entered judgment for CT on Bates's cross-complaint against it. Bates

timely filed a notice of appeal, challenging the summary judgment. CT timely filed a

notice of cross-appeal, challenging the order denying its motion for leave to augment.

7

DISCUSSION

BATES'S APPEAL

I

Summary Judgment Standard of Review

"On appeal after a motion for summary judgment has been granted, we review the

record de novo, considering all the evidence set forth in the moving and opposition

papers except that to which objections have been made and sustained." (Guz v. Bechtel

National, Inc. (2000) 24 Cal.4th 317, 334; see Saelzler v. Advanced Group 400 (2001) 25

Cal.4th 763, 767.) "The purpose of the law of summary judgment is to provide courts

with a mechanism to cut through the parties' pleadings in order to determine whether,

despite their allegations, trial is in fact necessary to resolve their dispute." (Aguilar v.

Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843 (Aguilar).)

Aguilar clarified the standards that apply to summary judgment motions under

Code of Civil Procedure section 437c.4 (Aguilar, supra, 25 Cal.4th at pp. 843-857.)

Generally, if all the papers submitted by the parties show there is no triable issue of

material fact and the " 'moving party is entitled to a judgment as a matter of law,' " the

court must grant the motion for summary judgment. (Aguilar, at p. 843, quoting § 437c,

subd. (c).) Section 437c, subdivision (p)(2), states:

"A defendant . . . has met his or her burden of showing that a cause of action has no merit if that party has shown that one or more

4 All statutory references are to the Code of Civil Procedure unless otherwise specified.

8 elements of the cause of action, even if not separately pleaded, cannot be established, or that there is a complete defense to that cause of action. Once the defendant . . . has met that burden, the burden shifts to the plaintiff . . . to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto. The plaintiff . . . may not rely upon the mere allegations or denials of its pleadings to show that a triable issue of material fact exists but, instead, shall set forth the specific facts showing that a triable issue of material fact exists as to that cause of action or a defense thereto."

Aguilar made the following observations:

"First, and generally, from commencement to conclusion, the party moving for summary judgment bears the burden of persuasion that there is no triable issue of material fact and that he is entitled to judgment as a matter of law. . . . There is a triable issue of material fact if, and only if, the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof. . . .

"Second, and generally, the party moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact; if he carries his burden of production, he causes a shift, and the opposing party is then subjected to a burden of production of his own to make a prima facie showing of the existence of a triable issue of material fact. . . . A prima facie showing is one that is sufficient to support the position of the party in question. . . .

"Third, and generally, how the parties moving for, and opposing, summary judgment may each carry their burden of persuasion and/or production depends on which would bear what burden of proof at trial. . . . [I]f a defendant moves for summary judgment against . . . a plaintiff [who would bear the burden of proof by a preponderance of the evidence at trial], [the defendant] must present evidence that would require a reasonable trier of fact not to find any underlying material fact more likely than not--otherwise, he would not be entitled to judgment as a matter of law, but would have to present his evidence to a trier of fact." (Aguilar, supra, 25 Cal.4th at pp. 850-851, fns. omitted.)

Aguilar stated:

9 "To speak broadly, all of the foregoing discussion of summary judgment law in this state, like that of its federal counterpart, may be reduced to, and justified by, a single proposition: If a party moving for summary judgment in any action . . . would prevail at trial without submission of any issue of material fact to a trier of fact for determination, then he should prevail on summary judgment. In such a case, . . . the 'court should grant' the motion 'and avoid a . . . trial' rendered 'useless' by nonsuit or directed verdict or similar device." (Aguilar, supra, 25 Cal.4th at p. 855, italics added.)

"[E]ven though the court may not weigh the plaintiff's evidence or inferences

against the defendants' as though it were sitting as the trier of fact, it must nevertheless

determine what any evidence or inference could show or imply to a reasonable trier of

fact. . . . In so doing, it does not decide on any finding of its own, but simply decides

what finding such a trier of fact could make for itself." (Aguilar, supra, 25 Cal.4th at

p. 856.) "[I]f the court determines that all of the evidence presented by the plaintiff, and

all of the inferences drawn therefrom, show and imply [the ultimate fact] only as likely as

[not] or even less likely, it must then grant the defendants' motion for summary judgment,

even apart from any evidence presented by the defendants or any inferences drawn

therefrom, because a reasonable trier of fact could not find for the plaintiff. Under such

circumstances, the [factual] issue is not triable--that is, it may not be submitted to a trier

of fact for determination in favor of either the plaintiff or the defendants, but must be

taken from the trier of fact and resolved by the court itself in the defendants' favor and

against the plaintiff." (Id. at p. 857, fn. omitted.)

"On appeal, we exercise 'an independent assessment of the correctness of the trial

court's ruling, applying the same legal standard as the trial court in determining whether

there are any genuine issues of material fact or whether the moving party is entitled to

10 judgment as a matter of law.' [Citation.] 'The appellate court must examine only papers

before the trial court when it considered the motion, and not documents filed later.

[Citation.] Moreover, we construe the moving party's affidavits strictly, construe the

opponent's affidavits liberally, and resolve doubts about the propriety of granting the

motion in favor of the party opposing it.' " (Seo v. All-Makes Overhead Doors (2002) 97

Cal.App.4th 1193, 1201-1202.)

II

Negligence Claims Generally

In California, the general rule is that all persons have a duty to use ordinary care to

prevent others from being injured as a result of their conduct. (Civ. Code, § 1714;

Rowland v. Christian (1968) 69 Cal.2d 108, 112-113.) "The elements of a cause of

action for negligence are: duty; breach of duty; legal cause; and damages. [Citations.]

The existence of a duty is the threshold element of a negligence cause of action."

(Friedman v. Merck & Co. (2003) 107 Cal.App.4th 454, 463.) " 'The threshold element

of a cause of action for negligence is the existence of a duty to use due care toward an

interest of another that enjoys legal protection against unintentional invasion. [Citations.]

Whether this essential prerequisite to a negligence cause of action has been satisfied in a

particular case is a question of law to be resolved by the court.' " (Artiglio v. Corning

Inc. (1998) 18 Cal.4th 604, 614.) "To say that someone owes another a duty of care ' "is

a shorthand statement of a conclusion, rather than an aid to analysis in itself. . . . '[D]uty'

is not sacrosanct in itself, but only an expression of the sum total of those considerations

of policy which lead the law to say that the particular plaintiff is entitled to protection."

11 [Citation.]' [Citation.] '[L]egal duties are not discoverable facts of nature, but merely

conclusory expressions that, in cases of a particular type, liability should be imposed for

damage done.' " (Hoff v. Vacaville Unified School Dist. (1998) 19 Cal.4th 925, 933.)

"[T]he question of the existence and scope of a defendant's duty of care is a legal

question which depends on the nature of the . . . activity in question and on the parties'

general relationship to the activity, and is an issue to be decided by the court, rather than

the jury." (Knight v. Jewett (1992) 3 Cal.4th 296, 313.)

Rowland set forth certain policy considerations that should be taken into account

in determining whether a legal duty of care should be imposed in a particular case.

"Rowland enumerates a number of considerations, however, that have been taken into

account by courts in various contexts to determine whether a departure from the general

rule [i.e., that a duty of due care exists to avoid injuring others] is appropriate: 'the major

[considerations] are the foreseeability of harm to the plaintiff, the degree of certainty that

the plaintiff suffered injury, the closeness of the connection between the defendant's

conduct and the injury suffered, the moral blame attached to the defendant's conduct, the

policy of preventing future harm, the extent of the burden to the defendant and

consequences to the community of imposing a duty to exercise care with resulting

liability for breach, and the availability, cost, and prevalence of insurance for the risk

involved.' (Italics added.) [Citation.] The foreseeability of a particular kind of harm

plays a very significant role in this calculus [citation], but a court's task--in determining

'duty'--is not to decide whether a particular plaintiff's injury was reasonably foreseeable

in light of a particular defendant's conduct, but rather to evaluate more generally whether

12 the category of negligent conduct at issue is sufficiently likely to result in the kind of

harm experienced that liability may appropriately be imposed on the negligent party."

(Ballard v. Uribe (1986) 41 Cal.3d 564, 572-573, fn. 6.)

However, when the alleged injury is other than physical harm, a different set of

considerations may apply in determining whether a duty of care exists. (Bily v. Arthur

Young & Co. (1992) 3 Cal.4th 370, 397.) In the absence of privity of contract, Biakanja

v. Irving (1958) 49 Cal.2d 647 set forth certain factors that should be considered in

determining whether a duty of care and negligence liability should be imposed in a

particular case. Biakanja stated:

"The determination whether in a specific case the defendant will be held liable to a third person not in privity is a matter of policy and involves the balancing of various factors, among which are the extent to which the transaction was intended to affect the plaintiff, the foreseeability of harm to him, the degree of certainty that the plaintiff suffered injury, the closeness of the connection between the defendant's conduct and the injury suffered, the moral blame attached to the defendant's conduct, and the policy of preventing future harm." (Id. at p. 650.)

Under negligence principles, a person generally has no duty to protect another

from harm in the absence of a special relationship or custody or control. (Nally v. Grace

Community Church (1988) 47 Cal.3d 278, 293.) However, if a person voluntarily or

gratuitously undertakes to perform services, a duty to exercise due care in performing

those services exists. "A person not required to perform services for another may

sometimes do so in a voluntary or gratuitous undertaking, and in that case, is under a duty

to exercise due care in performance." (6 Witkin, Summary of Cal. Law (10th ed. 2005)

Torts, § 1060, p. 371.) Alternatively stated, "[a] defendant who enters upon an

13 affirmative course of conduct affecting the interests of another is regarded as assuming a

duty to act, and will be liable for negligent acts or omissions [citations], because one who

undertakes to do an act must do it with care. [Citations.] As [Prosser, Handbook of the

Law of Torts (4th ed. 1971) § 56, p. 346] states: 'Where performance clearly has begun,

there is no doubt that there is a duty of care.' " (Bloomberg v. Interinsurance Exchange

(1984) 162 Cal.App.3d 571, 575.)

The principle that a person may be liable for negligent performance of a voluntary

undertaking has been applied in cases involving only financial loss and without any

physical harm to persons or property. In Valdez v. Taylor Automobile Co. (1954) 129

Cal.App.2d 810 (Valdez), a car dealer advertised that the purchase price of a car would

include the cost of a liability insurance policy for a car buyer. (Id. at p. 812.) The

plaintiff bought a car and informed the salesperson he wanted full coverage insurance to

protect himself from liability in the event of an accident. (Ibid.) The salesperson stated

he would obtain that insurance and prepared documents for the sale and insurance. (Id. at

p. 813.) When the plaintiff was sued following a car accident, he tendered his defense to

the car dealer. (Id. at p. 814.) The dealer declined and a money judgment was entered

against the plaintiff. (Ibid.) The plaintiff then filed an action against the dealer for

breach of contract, negligence, and fraud. (Id. at p. 812.) Although the jury apparently

rejected the plaintiff's breach of contract claim, it found the dealer liable and awarded the

plaintiff $18,465. (Id. at p. 815.)

On appeal, the car dealer argued that because the jury found there was no contract

obligating it to obtain insurance for the plaintiff, it had no duty to procure that insurance

14 and, absent such contractual duty, the plaintiff could not recover for the dealer's negligent

failure to procure that insurance. (Valdez, supra, 129 Cal.App.2d at p. 817.) Valdez

rejected that argument, stating: "It is well established that a person may become liable in

tort for negligently failing to perform a voluntarily assumed undertaking even in the

absence of a contract to do so. A person may not be required to perform a service for

another but he may undertake to do so--called a voluntary undertaking. In such a case the

person undertaking to perform the service is under a duty to exercise due care in

performing the voluntarily assumed duty, and a failure to exercise due care is negligence.

Dean Prosser says, '[I]f the defendant enters upon an affirmative course of conduct

affecting the interests of another, he is regarded as assuming a duty to act, and will

thereafter be liable for negligent acts or omissions,' and '. . . [t]here is authority that where

the defendant has reason to expect such reliance to the plaintiff's detriment, even a mere

gratuitous promise will be enough to create a duty, for the breach of which a tort action

will lie.' " (Id. at pp. 817-818.) Valdez modified the judgment awarding the plaintiff

damages in tort and affirmed the judgment, as so modified. (Id. at p. 823.)

Aim Insurance Co. v. Culcasi (1991) 229 Cal.App.3d 209 (Aim Insurance), cited

by Bates, involved similar factual circumstances in which the defendant allegedly failed

to obtain insurance despite a voluntary undertaking to do so. (Id. at pp. 215-217.) Aim

Insurance cited Valdez with approval and concluded the allegations in its case "state a

cause of action for negligence based on Culcasi's alleged breach of his duty to perform

with due care the task he undertook and upon which [the plaintiff] relied." (Aim

Insurance, at p. 216; see also Cooper v. State Farm Mutual Automobile Ins. Co. (2009)

15 177 Cal.App.4th 876, 904 [complaint sufficiently alleged cause of action for negligent

voluntary undertaking and/or promissory estoppel based on defendant's alleged failure to

preserve tire evidence despite voluntary representation it would preserve that evidence].)

In Artiglio v. Corning Inc., supra, 18 Cal.4th at page 613, the California Supreme

Court cited with approval Valdez's description of the duty of care arising out of a

voluntary undertaking. Artiglio stated it had previously described the negligent

undertaking theory of liability as firmly rooted in the common law of negligence. It

stated: "Thus, it is settled law that one 'who, having no initial duty to do so, undertakes to

come to the aid of another--the 'good Samaritan' "--has 'a duty to exercise due care in

performance and is liable if (a) his failure to exercise care increases the risk of such harm,

or (b) the harm is suffered because of the other's reliance upon the undertaking.'

([Citations]; see also BAJI No. 4.45 ['A person who is under no duty to care for or render

service to another but who voluntarily assumes such a duty, is liable to the other for

injury caused by a failure to exercise ordinary or reasonable care in the performance of

that assumed duty.'].)" (Artiglio, at p. 613, fn. omitted.) Artiglio stated: "[A] negligent

undertaking claim of liability to third parties requires evidence that: (1) the actor . . .

undertook, gratuitously or for consideration, to render services to another . . . ; (2) the

services rendered were of a kind the actor should have recognized as necessary for the

protection of third persons (plaintiffs); (3) the actor failed to exercise reasonable care in

the performance of its undertaking; (4) the failure to exercise reasonable care resulted in

physical harm to the third persons; and (5) either (a) the actor's carelessness increased the

risk of such harm, or (b) the undertaking was to perform a duty owed by the other to the

16 third persons, or (c) the harm was suffered because of the reliance of the other or the third

persons upon the undertaking." (Id. at pp. 613-614.) Based on Artiglio's citation of

Valdez and other authorities with approval, we believe the Supreme Court intended to

approve the application of the voluntary undertaking theory of duty in negligence cases

regardless of the type of damages suffered (i.e., both cases involving physical harm to

persons or property and cases involving only economic loss). To the extent Artiglio

phrased the voluntary undertaking theory as requiring physical harm to third persons, we

believe it did so because the plaintiffs in that case suffered physical harm allegedly

caused by silicone gel breast implants. (Id. at pp. 610-611.) CT has not cited, and we are

unaware of, any decision by the Supreme Court involving only economic loss that

expressly holds the voluntary undertaking theory of duty under negligence law does not

apply. We decline to restrict the application of that theory in cases in which public policy

supports its application.

III

Order Granting CT's Motion for Summary Judgment

Bates contends the trial court erred by granting CT's motion for summary

judgment. He asserts there is, at a minimum, a triable issue of material fact regarding

whether CT voluntarily undertook to prepare the 2004 Trust Deed and therefore owed

him a duty of due care.

A

In moving for summary judgment, CT argued that it did not agree to properly

consummate the re-recording transaction and therefore did not owe Bates any duty of

17 care. In its separate statement of undisputed material facts, CT asserted: "Neither Tucker

nor Bates asked [CT] to 'properly consummate' the 're-recording' transaction as an

accommodation." In support of that asserted undisputed fact, CT cited Marshall's

declaration in which she stated: "In connection with my notarization of Tucker's signature

to the 2004 Deed of Trust, neither Tucker nor Bates opened an escrow with me or [CT].

They never asked me or [CT] to 'properly consummate' the 're-recording' transaction as

an accommodation." Marshall's declaration also stated: "In December 2003, [SDCCU]

and [RRV3], through [Tucker], opened an escrow with [CT] for a $1.6 million loan by

SDCCU to RRV3 that would be secured by a deed of trust against the [Property] (the

'SDCCU Escrow'). I was [CT]'s escrow holder for the SDCCU Escrow. . . . Based upon

my review of the escrow file, including [the] escrow instructions, the only parties to the

SDCCU Escrow were SDCCU and RRV3. There is no evidence that I am aware of

indicating that Bates was a party to the SDCCU Escrow." Marshall stated: "[CT] did not

record or cause to be recorded the 2004 Deed of Trust. Additionally, . . . [CT] neither

obtained a preliminary title report nor issued any title insurance policy in connection with

the 2004 Deed of Trust. No one instructed me to perform a title search on the Property or

otherwise verify the vesting information on the 2004 Deed of Trust." Marshall further

declared: "I do not believe I had any involvement with the preparation of the 2004 [Trust

Deed] other than notarizing it. This is because the 2004 Deed of Trust was typed on a

pre-printed [stationery] form provided by [CT] (in blank form) to its clients. When I

prepare deeds of trust for recording against real property in California, I use computer-

generated forms."

18 In opposing CT's motion for summary judgment, Bates argued that CT agreed to,

and did, prepare a deed of trust to replace the 2002 Trust Deed and negligently prepared

the 2004 Trust Deed by mistakenly listing the wrong trustor (i.e., Raytheon, instead of

RRV3) on it. He further argued CT owed him a duty to correctly prepare the 2004 Trust

Deed and knew, based on its handling of the SDCCU escrow, who the correct trustor was

(i.e., RRV3 and not Raytheon). In support of his opposition, Bates submitted a separate

statement of undisputed material facts, in which he asserted he "was a party to the

[SDCCU] escrow to the extent that [CT] agreed that if Mr. Bates reconveyed his 2002

Deed of Trust with a zero [pay-out] so the SDCCU Escrow could close, [CT] would

ensure that it would prepare a replacement deed of trust for Mr. Bates following the close

of the SDCCU Escrow." Bates disputed CT's assertion that neither Tucker nor Bates

asked it to "properly consummate" the "re-recording" transaction as an accommodation.

To refute CT's asserted fact, Bates asserted:

"While the SDCCU Escrow was still pending, Mr. Bates, Jr.[,] called Renee Marshall to confirm that [CT] would prepare the replacement deed of trust and ensure that it was executed and notarized soon after the close of the SDCCU Escrow. Ms. Marshall confirmed that this would be done. Essentially, Ms. Marshall provided complete assurances that if Mr. Bates submitted a zero beneficiary demand and executed the Reconveyance, she would ensure the replacement deed of trust would be executed and notarized."

Also, refuting CT's assertion that it did not obtain a preliminary title report in connection

with the 2004 Trust Deed, Bates asserted: "As escrow holder and title insurer for the

SDCCU Escrow, [CT] was in possession of the preliminary reports issued in connection

with the SDCCU Escrow, which closed on April 9, [2004]. [¶] . . . [¶] . . . [CT] simply

19 failed to correctly type in the information they already knew, and which had not

changed." Refuting CT's assertion that no one instructed Marshall to perform a title

search on the Property or otherwise verify the vesting information on the 2004 Trust

Deed, Bates asserted:

"As escrow holder and title insurer for the SDCCU Escrow, [CT] was in possession of the preliminary reports issued in connection with the SDCCU Escrow, which closed on April 9, [2004]. Further, [CT] knew who the owner of the Property was on April 23, 2004, the date the [2004 Trust Deed] was executed."

As additional disputed material facts, Bates asserted: "In that she was the escrow

officer for the SDCCU Escrow, on April 23, [2004], Renee Marshall knew that the owner

of the Property was [RRV3]." He made further assertions citing the declaration of Robert

L. Bates, in which he declared:

"7. . . . While the SDCCU Escrow was pending, [Tucker], the principal of RRV3, requested that my father and [CT] enter [into] an agreement whereby my father would reconvey his deed of trust [i.e., the 2002 Trust Deed], and then Mr. Tucker would re-execute a replacement deed of trust after the close of the SDCCU Escrow (the 'Bates 2004 Deed of Trust' [i.e., the 2004 Trust Deed]).

"8. My father would only agree to reconvey his 2002 [Trust Deed] (and submit a zero beneficiary demand on a Note with a significant balance), if [CT] would ensure that a replacement deed of trust transaction was consummated by 1) preparing the replacement deed of trust and 2) having it executed and notarized.

"9. In this regard, while the SDCCU Escrow was still pending, I called Renee Marshall to confirm that [CT] would prepare the replacement deed of trust and ensure that it was executed and notarized soon after the close of the SDCCU Escrow. Ms. Marshall confirmed that this would be done. It is my understanding that the SDCCU Escrow could not have closed unless my father reconveyed his 2002 [Trust Deed]. Essentially, Ms. Marshall provided complete assurances that if my father submitted a zero beneficiary demand

20 and executed the Reconveyance, she would ensure the replacement deed of trust would be executed and notarized. I considered [CT]'s agreement in this regard to be part of and in furtherance of the SDCCU Escrow. If Ms. Marshall had not confirmed that [CT] would handle this transaction, my father would have either not agreed to execute the reconveyance of the 2002 [Trust Deed], or otherwise would have instructed a third party to handle the transaction on his behalf."

Bates further declared:

"10. Thereafter, on or about March 18, 2004, Ms. Marshall prepared and forwarded the following documents for my father's signature: 1) Request for Demand and Full Reconveyance . . . ; 2) Beneficiary's Demand . . . ; [and] 3) Substitution of Trustee and Full Reconveyance . . . . In reliance upon Ms. Marshall's confirmation that [CT] would ensure that a replacement deed of trust would be prepared, executed, and notarized, my father submitted a 'zero' beneficiary demand and executed the Reconveyance.

"11. I am informed and believe that the SDCCU Escrow closed approximately April 9, 2004. Also in April 2004, my father was participating in another lending transaction in which he would receive two deeds of trust recorded against 1) real property owned by Stage Coach Ventures, LLC, an entity owned or controlled by [Tucker] (the 'Stagecoach Deed of Trust'), and 2) residential real property owned by Theresa Tucker, Mr. Tucker's wife (the 'Atrium Deed of Trust'). [CT] acted as the Escrow officer and the title insurer for these transactions [citation]. Around this time, I also inquired with Renee Marshall regarding the status of the preparation and execution of the replacement deed of trust on the Property. Ms. Marshall confirmed again that [CT] would ensure that this replacement deed of trust would be prepared, executed, and notarized.

"12. On April 23, 2004, the same day that the replacement deed of trust on the [Property] was to be executed, Renee Marshall faxed the drafts of the Stagecoach and Atrium Deeds of Trust to my office for my review. [Citation.] The draft of the Stage Coach Deed of Trust faxed by Ms. Marshall to me was prepared on the exact same typewritten form . . . as the [2004 Trust Deed], on the same day that the [2004 Trust Deed] was presented to Mr. Tucker for signature at Renee Marshall's office. [Citations.] Although, prior to March 19,

21 [2004], I had instructed Ms. Marshall to ensure that the [replacement] deed of trust be prepared, I believe that either Renee Marshall, one of her assistants, or another [CT] employee prepared the [2004 Trust Deed] actually on April 23, [2004], knowing that Mr. Tucker would be meeting with Ms. Marshall to execute the Stagecoach and the Atrium Deeds of Trust. [¶] . . . [¶]

"14. I did not prepare the [2004 Trust Deed]. My father did not prepare the [2004 Trust Deed]. . . . I have no reason to believe that anyone other than Renee Marshall, or another [CT] employee in her office, prepared this deed of trust. In that Ms. Marshall acted as the escrow officer for the SDCCU Escrow, I believe it was rational for me to assume that Ms. Marshall knew who the owner of the Property was, and to my knowledge, Ms. Marshall has never denied that she knew that [RRV3] was the owner of the Property on April 23, [2004]."

Bates also lodged certain documents, including excerpts from Tucker's deposition.

In that deposition, Tucker stated he did not bring any deeds of trust with him when

meeting with Marshall on April 23, 2004. He stated he did not prepare the 2004 Trust

Deed and that he "got it from her [Marshall]. . . . I went to her office and picked it up and

signed it with her."

In reply, CT argued the undisputed facts showed a "replacement" trust deed was,

in fact, prepared because the 2004 Trust Deed contained material terms identical to those

in the 2002 Trust Deed. Because the 2004 Trust Deed identified the same trustor (i.e.,

Raytheon), the same property, and same beneficiary, CT argued the 2004 Trust Deed was

a "replacement" trust deed. CT also argued it was not instructed by Bates, either

expressly or implicitly, to search the title for the Property or otherwise verify the vesting

information for the 2004 Trust Deed. Furthermore, it argued it would be unreasonable to

22 expect Marshall to know or recall the proper vesting for the 2004 Trust Deed based on

her handling of the SDCCU escrow.

At oral argument on CT's motion for summary judgment, Bates argued that "[t]he

uncontroverted evidence is that [CT] knew the correct vesting information. [Bates had]

[n]o need to request that they verify it. . . . [CT] has never disputed . . . that they knew

the correct vesting information at the time the request was made to prepare the deed of

trust. The [alleged] negligence is just failing to insert that correct vesting information in

the [2004 Trust Deed], not failing to search title [because] they didn't need to." Bates

argued CT knew the correct vesting information (i.e., that RRV3, and not Raytheon, was

the correct trustor for the 2004 Trust Deed) because "the request was made during the

pendency of the [SDCCU] transaction," which involved RRV3 as the owner of the

property and trustor of the SDCCU trust deed. In reply, CT argued: "[T]hat's information

gained from another escrow which happened prior to the actual transaction we're talking

about. . . . I don't think that would be a sensible way of verifying vesting on a deed of

trust to use information acquired from an escrow that closed weeks ago."

The trial court granted CT's motion for summary judgment, stating:

"Even if [Bates] establishes that [CT] agreed to 'consummate' the 2004 [Trust Deed] re-recording transaction, Bates fails to establish that [CT] was required to verify the vesting information in the 2004 [Trust Deed]. [¶] . . . [¶]

"[CT] submits evidence that the 2004 [Trust Deed] is identical to the 2002 [Trust Deed] -- it identifies the same trustor, trust properties and same beneficiaries as the 2002 [Trust Deed]. [Citation.] In essence, the 2004 [Trust Deed] is a replacement -- precisely what [CT] allegedly agreed to provide.

23 "It is undisputed that the 2004 [Trust Deed] identifies Raytheon, not RRV3[,] as the trustor [citation]. . . . Bates provides no authority establishing that an instruction to an escrow holder to prepare a deed of trust 'implies' a duty to search title or verify vesting. Nor is evidence that [CT] agreed to consummate the 2004 [Trust Deed] re- recording transaction, and [CT's] involvement in the related 2004 SDCCU Escrow, sufficient to establish an implied obligation to verify vesting. [¶] . . . [¶]

"By virtue of artful pleading, [Bates] seeks to recharacterize a very informal, almost casual, arrangement into a formal legal commitment. In doing so, he seeks to place himself in a better position than a party who requests and relies on a preliminary report of title. But if a party who relies on such a report is unable to hold the title company liable as an abstractor [citation], there would appear to be no basis on which [Bates] can do so. [Citation.]

"Absent establishing [CT's] obligation to verify the vesting information in the 2004 [Trust Deed], Bates'[s] claims against [CT] fail."

Accordingly, the trial court entered judgment for CT on Bates's cross-complaint against

it.

B

Based on our independent review of the parties' summary judgment papers, we

conclude there are triable issues of material fact that preclude summary judgment in the

circumstances of this case. First, there are triable issues of fact regarding whether CT (by

Marshall or another employee) agreed or undertook to prepare, and did prepare, a trust

deed to replace the 2002 Trust Deed. CT asserted that neither Tucker nor Bates asked it

to "properly consummate" the re-recording transaction as an accommodation. CT argued

that because Bates cannot show it actually agreed to prepare the 2004 Trust Deed as an

accommodation to him, CT did not owe any duty of care to him and could not have

24 breached any such duty. Also, Marshall stated in her declaration that she did not believe

she "had any involvement with the preparation of the 2004 [Trust Deed] other than

notarizing it."

However, in opposing CT's motion for summary judgment, Bates asserted that

during the SDCCU escrow Marshall confirmed CT would prepare a trust deed to replace

the 2002 Trust Deed and would have it executed and notarized. Robert L. Bates declared

that while the SDCCU escrow was still open Marshall confirmed CT "would prepare the

replacement deed of trust and ensure that it was executed and notarized soon after the

close of the SDCCU Escrow." Furthermore, Bates asserted that, contrary to Marshall's

declaration, she or another CT employee did, in fact, prepare the 2004 Trust Deed.

Robert L. Bates declared that he did not prepare the 2004 Trust Deed and Tucker stated at

his deposition that he did not prepare it. Tucker stated that on April 23, 2004, he went to

Marshall's office, received the 2004 Trust Deed from her, and signed it with her.

Based on the above evidence, we conclude there are triable issues of fact whether

Marshall agreed, on behalf of CT, to prepare a deed of trust to replace the 2002 Trust

Deed and whether she (or another CT employee) did, in fact, prepare the 2004 Trust

Deed. Those triable issues, when considered together with the triable issue discussed

below regarding CT's alleged undertaking, precluded summary judgment for CT.

Second, assuming Bates shows that CT (by Marshall or another employee) agreed

to--or undertook to--prepare, and did prepare, a trust deed to replace the 2002 Trust Deed,

there is a triable issue of fact regarding the nature and extent of that agreement or

undertaking. For Bates to prove his negligence cause of action against CT, he must

25 initially show CT owed him a duty of due care in the preparation of the 2004 Trust Deed.

The nature and extent of any such alleged duty is necessarily dependent on the nature and

extent of CT's actual undertaking. However, the parties disagree regarding the nature and

extent of that alleged undertaking. CT denies it agreed to "properly consummate" the re-

recording transaction or that it was instructed to verify the 2004 Trust Deed's vesting

information. In contrast, Bates asserts CT agreed to prepare a replacement trust deed and

have it executed and notarized. Furthermore, because Marshall was the escrow officer

for the pending SDCCU escrow at the time of that agreement or undertaking, Bates

asserts she knew the identity of the correct trustor for the replacement trust deed (i.e.,

RRV3 and not Raytheon). Bates further asserts that because CT was the escrow holder

and title insurer for the SDCCU escrow, CT possessed the preliminary reports issued in

connection with the SDCCU Escrow, which showed RRV3 was the owner of the

Property and therefore the correct trustor for the replacement trust deed. Therefore, Bates

asserts that at the time CT made the alleged agreement or undertaking to prepare the

replacement trust deed, it knew the correct trustor (i.e., RRV3) for that trust deed.

Because the parties disagree and the evidence is conflicting (or at least unclear)

regarding the nature and extent of any alleged undertaking by CT, there is a triable issue

of material fact regarding what, if anything, CT undertook to do for Bates. Even if it is

found that CT undertook to prepare a "replacement" trust deed, the parties disagree on the

meaning of the term "replacement" in this case. CT argues the term "replacement" trust

deed merely means a trust deed with material terms identical to those in the 2002 Trust

Deed (e.g., the same trustor, beneficiary, and property). In contrast, Bates argues the

26 term "replacement" trust deed means a trust deed that contains the correct trustor and

other terms to the extent they are within CT's knowledge. Bates does not argue CT was

asked to perform a title search or otherwise verify the vesting information for the

replacement trust deed.

Until these disputed questions of fact are resolved, the question of law regarding

the existence and scope of CT's duty of due care cannot be determined. Accordingly, the

trial court erred by concluding there are no triable issues of material fact and CT was

entitled to summary judgment as a matter of law. The court erred by concluding that,

assuming CT agreed to prepare a "replacement" trust deed, CT did not owe Bates any

legal duty of due care in preparing the 2004 Trust Deed. Unlike other cases in which the

facts underlying an alleged duty of care are undisputed, this case involves disputed facts

that preclude a court from determining the existence and scope of any legal duty of care

until certain preliminary factual findings have been made. Disputed questions for the

trier of fact include (but are not limited to): (1) whether CT undertook to prepare a

"replacement" trust deed; (2) if so, what does the term "replacement" mean in the context

of this case; and (3) did CT actually prepare the 2004 Trust Deed? If it is found that CT

agreed or undertook to prepare a deed of trust to replace the 2002 Trust Deed and

prepared the 2004 Trust Deed, CT owed Bates a duty of due care to prepare the 2004

Trust Deed using the knowledge it gained through the related SDCCU escrow (e.g.,

RRV3 was the owner of the Property and thus the correct trustor for the 2004 Trust

Deed).

27 On resolution of those factual questions, the trial court may then address the

questions of law regarding the existence and scope of any legal duty of care CT owed to

Bates. Without addressing the merits of those questions of law in this appeal, we

nevertheless direct the trial court's attention to cases discussed above relating to a

voluntary or gratuitous undertaking by a party. "A defendant who [voluntarily or

gratuitously] enters upon an affirmative course of conduct affecting the interests of

another is regarded as assuming a duty to act, and will be liable for negligent acts or

omissions [citations], because one who undertakes to do an act must do it with care.

[Citations.] As [Prosser, Handbook of the Law of Torts, supra, § 56, p. 346] states:

'Where performance clearly has begun, there is no doubt that there is a duty of care.' "

(Bloomberg v. Interinsurance Exchange, supra, 162 Cal.App.3d at p. 575.) Likewise, as

Valdez stated: "It is well established that a person may become liable in tort for

negligently failing to perform a voluntarily assumed undertaking even in the absence of a

contract to do so. A person may not be required to perform a service for another but he

may undertake to do so--called a voluntary undertaking. In such a case the person

undertaking to perform the service is under a duty to exercise due care in performing the

voluntarily assumed duty, and a failure to exercise due care is negligence." (Valdez,

supra, 129 Cal.App.2d at p. 817, italics added; see also Aim Insurance, supra, 229

Cal.App.3d at p. 216 [citing Valdez with approval and concluding the allegations in its

case "state a cause of action for negligence based on Culcasi's alleged breach of his duty

to perform with due care the task he undertook and upon which [the plaintiff] relied."].)

As discussed above, we do not believe the California Supreme Court has precluded the

28 application of the voluntary undertaking theory of duty under negligence law to cases

involving only economic loss, as in this case. (Cf. Artiglio v. Corning Inc., supra, 18

Cal.4th at pp. 613-614.)

We are not persuaded by CT's argument that Bates cannot show it owed him a

duty of care because he did not request it to perform a title search or otherwise verify the

correct vesting information for the 2004 Trust Deed. If CT voluntarily undertook to, and

did, prepare a replacement trust deed, CT owed Bates a duty of due care even if Bates did

not ask CT to perform a title search or otherwise verify the correct vesting information

for the 2004 Trust Deed. (Cf. Valdez, supra, 129 Cal.App.2d at p. 817; Aim Insurance,

supra, 229 Cal.App.3d at p. 216.) Summit Financial Holdings, Ltd. v. Continental

Lawyers Title Co. (2002) 27 Cal.4th 705, cited by CT, is factually inapposite and does

not persuade us to reach a contrary conclusion. In Summit, the escrow holder simply

followed the parties' explicit escrow instructions requiring it to pay off a note by

disbursing the payment to Talbert. (Id. at p. 708.) Although the escrow holder was

aware Talbert had assigned the note to the plaintiff, it did not owe the plaintiff any duty

of care to make payment to it rather than Talbert. (Ibid.) Although Summit generally

stated "an escrow holder's obligations are 'limited to faithful compliance with [the

parties'] instructions' " (id. at p. 711), the facts in that case did not involve any voluntary

undertaking by the escrow holder to make payment to the plaintiff. Because this case

involves an alleged voluntary undertaking by CT, Summit is inapposite to this case and

does not require summary judgment for CT.

29 Similarly, we reject CT's argument that it cannot owe any duty to third parties to

an escrow (e.g., Bates) because escrow holders cannot be liable for any acts done outside

of escrow. Schaefer v. Manufacturers Bank (1980) 104 Cal.App.3d 70, cited by CT, is

factually inapposite and does not persuade us to reach a contrary conclusion. That case

involves a side agreement outside of escrow between the plaintiff and a third party in

which the escrow holder had no involvement. (Id. at pp. 73, 76-77.) By strictly

complying with the escrow instructions, the escrow holder fulfilled its duties and owed

no duty to the plaintiff based on the side agreement (of which it apparently had no

knowledge). (Id. at pp. 72-73, 78.) Schaefer did not involve any voluntary agreement or

undertaking by the escrow holder with the plaintiff. Because this case involves an

alleged voluntary undertaking by CT, Schaefer is inapposite to this case and does not

require summary judgment for CT.

We also reject CT's argument that it is entitled to summary judgment because it

complied with the SDCCU escrow instructions and therefore could not have breached

any duty it owed to a nonparty to those instructions (e.g., Bates). However, that

argument is premised on CT's argument, discussed above, that it could not owe a third

party any duty because its duties are limited to those owed to parties to the escrow and

that arise out of explicit escrow instructions. However, as we concluded above, if CT

voluntarily agreed or undertook to prepare the 2004 Trust Deed, it owed Bates a duty of

due care even if Bates was not a party to the SDCCU escrow or if that undertaking was

not set forth in the SDCCU escrow instructions. None of the cases cited by CT are

apposite to this case or otherwise persuade us to reach a contrary conclusion. To the

30 extent CT argues it has not breached any duty it owed to Bates based on its voluntary

undertaking, it does not persuade us there are no triable issues of material fact regarding

whether it breached that duty and it is entitled to summary judgment as a matter of law.

Although CT also argues it cannot be liable for negligence because Bates did not

expressly or implicitly instruct it to verify the vesting information for the 2004 Trust

Deed, Bates asserted below, and asserts on appeal, that his negligence cause of action is

not based on any request that CT verify the vesting information. Rather, Bates asserts

CT's negligence liability is based on its duty of due care owed him arising out of its

voluntary undertaking and its knowledge that RRV3, and not Raytheon, was the correct

trustor for the 2004 Trust Deed. Therefore, the absence of any request by Bates that CT

verify the vesting information for the 2004 Trust Deed does not entitle CT to summary

judgment.

Finally, CT argues Bates's negligence cause of action is, in effect, a title insurance

claim. Because Bates did not purchase title insurance for the 2004 Trust Deed, CT

argues he cannot recover on that claim. Bates concedes he did not purchase title

insurance or request that CT perform a title search for the 2004 Trust Deed.

Nevertheless, Bates asserts his negligence cause of action against CT is independent of

any contractual claim he might have had he purchased title insurance or any other cause

of action he may have had had he requested that CT perform a title search. Had Bates

purchased title insurance, he presumably would have had an alternative or secondary

means of obtaining relief for the injury he suffered in addition to his negligence cause of

31 action. A breach of contract claim and a negligence claim generally are not, in effect, the

same cause of action. To the extent the trial court concluded otherwise, it erred.

CT'S CROSS-APPEAL

IV

CT filed a cross-appeal challenging the order denying its motion for leave to

augment its expert witness list or, in the alternative, leave to submit tardy expert witness

information. However, because, as we explain below, that order is nonappealable, we

dismiss the cross-appeal.

A

"The existence of an appealable judgment is a jurisdictional prerequisite to an

appeal. A reviewing court must raise the issue on its own initiative whenever a doubt

exists as to whether the trial court has entered a final judgment or other order or judgment

made appealable by . . . section 904.1." (Jennings v. Marralle (1994) 8 Cal.4th 121,

126.) "A reviewing court has jurisdiction over a direct appeal only when there is (1) an

appealable order or (2) an appealable judgment. [Citations.] . . . [¶] A trial court's order

is appealable when it is made so by statute." (Griset v. Fair Political Practices Com.

(2001) 25 Cal.4th 688, 696.) "[A]n attempt to appeal from a nonappealable judgment or

order will ordinarily be dismissed." (Marsh v. Mountain Zephyr, Inc. (1996) 43

Cal.App.4th 289, 297.)

Section 904.1 generally sets forth those judgments and orders that are appealable.

In general, an appeal may be taken from a judgment other than an interlocutory judgment.

(§ 904.1, subd. (a)(1).) Accordingly, interlocutory rulings or orders, such as discovery

32 and evidentiary rulings, are generally not appealable. (Fraser-Yamor Agency, Inc. v.

County of Del Norte (1977) 68 Cal.App.3d 201, 207; Doe v. United States Swimming,

Inc. (2011) 200 Cal.App.4th 1424, 1432-1433; Datig v. Dove Books, Inc. (1999) 73

Cal.App.4th 964, 984; Haro v. City of Rosemead (2009) 174 Cal.App.4th 1067, 1078-

1079 [dismissing appeal from nonappealable order denying motion for leave to amend

complaint].)

However, certain nonappealable intermediate rulings may be challenged on appeal

from a subsequent final judgment if they are directly related to the judgment being

appealed. Section 906 provides:

"Upon an appeal pursuant to Section 904.1 or 904.2, the reviewing court may review the verdict or decision and any intermediate ruling, proceeding, order or decision which involves the merits or necessarily affects the judgment or order appealed from or which substantially affects the rights of a party, . . . and may affirm, reverse or modify any judgment or order appealed from . . . ." (Italics added.)

In Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939 (Cahill), we

stated: "[I]f a decision (e.g., final judgment) is properly appealed pursuant to section

904.1 or 904.2, section 906 allows us to 'review' certain 'intermediate' orders or other

rulings not otherwise directly appealable." (Id. at p. 946.) There are three circumstances

in which we may review a nonappealable order pursuant to section 906. (Id. at pp. 946-

948.) The nonappealable order must either: (1) "involve[] the merits" of the judgment

appealed from; (2) "necessarily affect[]" the judgment appealed from; or (3)

"substantially affect[] the rights of a party." (§ 906; Cahill, at pp. 946-948.) Regarding

the third circumstance, we stated:

33 "The clear import of that provision is to allow an appellate court to review rulings, orders, or other decisions that led up to, or directly related to, the judgment or order being appealed to the extent they substantially affected the rights of one of the parties to the appeal. It is implicit within section 906's language that the 'intermediate' order or decision that substantially affects the rights of a party must be one that led up to, or directly relates to, the judgment or order being appealed.

"Therefore, nonappealable orders or other decisions substantively and/or procedurally collateral to, and not directly related to, the judgment or order being appealed are not reviewable pursuant to section 906 even though they literally may 'substantially affect[]' one of the parties to the appeal." (Cahill, supra, 194 Cal.App.4th at p. 948, italics added.)

Finally, we note that a cross-appeal is subject to the same jurisdictional

requirements as an appeal. Accordingly, if a cross-appeal challenges a nonappealable

order, that order must meet the requirements of section 906, as discussed above. If it

does not, we must dismiss the cross-appeal.

B

In this case, the trial court issued an order denying CT's motion for leave to

augment its expert witness list or, in the alternative, leave to submit tardy expert witness

information. CT does not cite, and we are unaware of, any statutory authority (e.g.,

§ 904.1) making such an order appealable. Given that the order is nonappealable, we

consider whether section 906 allows us to review it. The judgment from which Bates

appeals is the judgment entered following the court's order granting CT's motion for

summary judgment. That summary judgment order is reviewable in an appeal of the final

judgment. (§ 904.1, subd. (a)(1); § 437c, subd. (m)(1); Levy v. Skywalker Sound (2003)

108 Cal.App.4th 753, 761, fn. 7.)

34 However, none of section 906's provisions for review of a nonappealable order

apply to allow us to review the order denying CT's motion for leave to augment its expert

witness list or, in the alternative, leave to submit tardy expert witness information. First,

that order did not involve the merits of the summary judgment being appealed. Rather, it

involved a collateral ruling regarding what expert witnesses CT could use at trial. The

merits of the summary judgment were based on the question of whether there are triable

issues of material fact and whether CT is entitled to judgment as a matter of law. CT's

motion for leave to augment did not involve any issues regarding whether there are

triable issues of material fact. Furthermore, because the trial court granted CT's motion

for summary judgment, it could have deferred any decision on CT's separate motion for

leave to augment until such time, if any, that its summary judgment was reversed and the

matter remitted to it.

Second, the order denying CT's motion for leave to augment did not necessarily

affect the summary judgment. Instead, it had no effect on the summary judgment.

Whether CT was given leave to augment its expert witness list or submit tardy expert

witness information had no relation to the issue of whether there are triable issues of

material fact and whether CT is entitled to summary judgment as a matter of law.

Finally, the order denying CT's motion for leave to augment was not directly

related to the summary judgment. Again, whether CT was given leave to augment its

expert witness list or submit tardy expert witness information had no relation to the issue

of whether there are triable issues of material fact and whether CT is entitled to summary

35 judgment as a matter of law. Accordingly, that order did not substantially affect CT's

rights within the meaning of section 906. (Cahill, supra, 194 Cal.App.4th at p. 948.)

We conclude the order denying CT's motion for leave to augment its expert

witness list or, in the alternative, leave to submit tardy expert witness information is not

appealable pursuant to section 904.1, section 906, or otherwise. Therefore, we must

dismiss CT's cross-appeal of that order for lack of jurisdiction. (Marsh v. Mountain

Zephyr, Inc., supra, 43 Cal.App.4th at p. 297.)

DISPOSITION

The judgment is reversed and the matter is remanded to the trial court for further

proceedings. The cross-appeal is dismissed. Each party shall bear its own costs on

appeal.

McDONALD, Acting P. J.

WE CONCUR:

McINTYRE, J.

O'ROURKE, J.

36