In Ducoing Management, Inc. v. Superior Court (filed 2/10/2015 after rehearing, No. G050457), the California Court of Appeal, Fourth District, held that a reversal of a nonsuit judgment “in all other respects” also served to reverse an unapportioned costs award. The decision “demonstrates the importance of the disposition in an appellate opinion in determining the form of judicial relief, particularly when the disposition reverses a judgment and remands for retrial.”
In Ducoing, a married couple created a corporation to provide painting services and created a second corporation, with both doing business under the same fictitious name. The companies suffered substantial losses when a dishonest payroll manager embezzled more than $90,000. Upon discovering that their insurance did not include employee dishonestly coverage, the two companies sued the insurance broker for failing to procure coverage that had been promised. The trial court granted nonsuit as to both plaintiffs and ordered that the broker was entitled to costs. On appeal from that judgment, the Court of Appeal affirmed the judgment as to one company, but reversed the judgment “in all other respects” and remanded to the trial court. Thereafter, the broker attempted to execute the full cost award and succeeded when the trial court denied the company’s motion to deem the prior judgment unenforceable. The company then petitioned the Court of Appeal for a writ of mandate challenging the trial court’s ruling and arguing that the broker still faced the very same claims and damages that it faced in the original trial, except that the Court of Appeal merely confirmed that the claims could not be pursued jointly by both companies, only one.
The Court of Appeal agreed, noting that it had left plaintiffs’ claims intact by allowing them to proceed in their entirety by the second company. The court then added, “[w]e reiterate the obvious: the phrase ‘the judgment is reversed in all other respects’ means what it says. . . . [w]e do not ‘hide elephants in mouseholes.'” The court held that its reversal was unqualified, with the single exception of the judgment of nonsuit against the first company. That is, there was nothing in the appellate opinion to suggest that the cost portion survived reversal “in all other respects.” Moreover, the court noted that there was no justification for allowing the broker to recover all of its trial costs as the prevailing party when the matter was still yet to be tried.
The Ducoing decision properly illustrates the general principle that an appellate court need not expressly comment on every matter intended to be covered by the disposition. If a disposition is imperfect or impractical of execution, however, the proper recourse is a petition for rehearing within 15 days of the decision.
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