“Impossible” Burden Met on Appeal: But Dissent Disagrees

You know about “de novo” and “abuse of discretion” and “substantial evidence.” But most attorneys have never heard of the “finding compelled as a matter of law” standard of appellate review. That is because it rarely comes up. The “compelled finding” standard only comes up when the party with the burden of proof (usually plaintiff) loses at trial, and argues on appeal that its case was so truly overwhelming that only an unreasonable fact-finder would have been left unpersuaded.

With that in mind, there are two interesting things about Missinato v. Missinato (D2d7 Apr. 15, 2022 no. B305989) 2022 WL 1124871 (nonpub. opn.). First, it is surprising because the court found the defendant’s statute-of-limitations defense so overwhelming that only an unreasonable person would be unpersuaded. Second, one of the panel was unpersuaded.

That seems awkward, no?

This was a partition action where brother and sister, Marco and Elisabetta, pooled their mother’s advance on their inheritance to buy a house together. But they left Marco’s name off the title (apparently assuming, incorrectly, they’d get a tax advantage given Marco was not a U.S. citizen.)

You know what happened next: Elisabetta denied Marco’s ownership. Marco sued, and after a trial the court awarded Marco his one-half interest under a resulting trust — which the Court of Appeal held was effectively a judgment of partition.

The Court Held That Uncontradicted Evidence Established a Statute of Limitations Defense as a Matter of Law:

On appeal, Elisabetta argued that the trial court should have found in her favor based on the four-year statute of limitations. Marco filed his action in September 2018. He had first asked in 2013 or 2014, when he first began suffering glaucoma, which resulted in blindness in one eye. Marco asked for his share of the property so he could make ends meet.

Elisabetta argued she had repudiated Marco’s interest when he first asked, more than four years prior to the complaint. Marco argued Elisabetta did not affirmatively reject his interest until a 2018 email.

(Interestingly, both parties misjudged the applicable statute of limitations as four years under Code of Civil Procedure section 343. But Marco’s claim was based on an oral agreement, so the statutory period under section 339 is two years. But the court proceeded with its analysis under the four-year statute, because that the statute the parties raised: “Although both sides cite the wrong statute of limitations, we decide the issues the parties ask us to decide. (See United States v. Sineneng-Smith (2020) ___ U.S. ___, ___ [140 S.Ct. 1575, 1579, 206 L.Ed.2d 866] [courts “ ‘normally decide only questions presented by the parties’ ”].)”)

So the question was whether Elisabetta repudiated Marco’s interest before or after September 2014. And because all the inferences fall in favor of Marco as the respondent, the question was whether there was any substantial evidence that the repudiation did not happen until after September 2014.

It is important to emphasize how difficult Elisabetta’s burden on appeal was here as the appellant seeking to reverse a factual finding on which she bore the burden of proof at trial. As the court summarized:

“But because the statute of limitations is an affirmative defense, on which the defendant has the burden of proof (Pollock v. Tri-Modal Distribution Services, Inc. (2021) 11 Cal.5th 918, 945), the standard of review is different (Dreyer's Grand Ice Cream, Inc. v. County of Kern (2013) 218 Cal.App.4th 828, 838). Where the appellant has failed to meet his or her burden of proof at trial, “ ‘the question for a reviewing court becomes whether the evidence compels a finding in favor of the appellant as a matter of law’ ” because “ ‘the appellant's evidence was (1) “uncontradicted and unimpeached” and (2) “of such a character and weight as to leave no room for a judicial determination that it was insufficient to support a finding.’ ”” (Ibid.; see Lent v. California Coastal Com. (2021) 62 Cal.App.5th 812, 837-838 [applying this standard to the defense of laches]; Eisen v. Tavangarian (2019) 36 Cal.App.5th 626, 647 [applying this standard to the defenses of waiver and estoppel].) The appellant in this situation has an “ ‘almost impossible’ ” burden. (Atkins v. City of Los Angeles (2017) 8 Cal.App.5th 696, 734.)”

But in a dramatic turn, the court announced: “And yet Elisabetta has met it here.” The court pointed to discussions between Elisabetta and Marco in 2013 in which Elisabetta said “it’s not half your house, Marco, it’s all mine,” and that she refused to sell it and share the proceeds with him.

The court spent only one paragraph rehearsing the evidence concerning the statute of limitations. This seems odd, given the standard of review is more exacting even that substantial evidence. The analysis must consider not just the evidence favoring the appellant, but the evidence and inferences supporting the judgment. Reading the majority’s analysis suggests there must have been really scant record evidence on this point. But as we will see, that is not so.

Dissenting, Judge Wise, Sitting Pro Tem, Notes Several Portions of the Record Support the Judgment, Thus Requiring Affirmance:

The upshot of the majority opinion is that no reasonable jurist could look at the record and fail to be persuaded that Elisabetta had not established her statute of limitations defense. It must have taken some pluck, then, for Judge Noël Wise, sitting on assignment, to write a dissent confessing he was not persuaded.

First, Judge Wise acknowledged the discussions the majority referenced. But Judge Wise noted that the record doesn’t actually say they occurred in 2013 — more than four years before Marco’s 2018 lawsuit — as the majority assumes. Instead, Judge Wise carefully noted the testimony reflected that the discussions happened at “times since” 2013. Not “in” 2013. The record elsewhere places the discussions in or after 2014, rather than 2013.

So no, the record did not reflect such clear and uncontradicted evidence such as to support a finding compelled as a matter of law.

Finally, Judge Wise noted that—contrary to Elisabetta’s repudiation of Marco’s interests—she offered that Marco could take $450,000 (his half of the purchase price) from her inheritance when their mom died “to make things equitable.” This supported an inference, Judge Wise noted, to support the finding that Elisabetta never orally repudiated Marco’s interest until her 2018 email.

(Judge Wise acknowledged that the inference could go either way. But Judge Wise correctly noted that, in the case of competing inferences on appeal, the court must always credit the inference to affirm the judgment. (Citizens Business Bank v. Gevorgian (2013) 218 Cal.App.4th 602, 613.))

Final Comments:

Judge Wise’s dissent seems to me clearly correct, and the majority opinion clearly incorrect. Here are some things that stood out as particularly odd:

• As noted above, the majority (and dissent) accepted that statute of limitations analysis was based on the four-year statute, because that is what both parties argued. And so the question was whether Elisabetta made her repudiation before or after September 2014. As mentioned above, the majority found that Elisabetta orally repudiated in a discussion in 2013. Also recall that Judge Wise in dissent noted that, in fact, the record supported placing that conversation not in 2013 at all, but in 2014, within the four-year statute. So what did the majority have to say about this? In a footnote, the majority said: “because the statute of limitations is actually two years, a few months either way in 2013 or 2014 doesn't really matter.” So to support its result, the majority actually had to backtrack on the premise that the four-year statute applied here.
• Portions of the record were based on an agreed statement rather than a reporter's transcript. An agreed statement is an imprecise means of recording testimony in any event. Very rarely can an appellant succeed, even on a more favorable standard of review, using an agreed statement. Let alone on the “almost impossible” finding-compelled-as-a-matter-of-law standard. Yet the appellant did the almost-impossible using arguably the worst form of record available. That, from what I can tell, is a first.
• The trial court issued a statement of decision, which was ambiguous about when the repudiation occurred. But Elisabetta did not object to the ambiguity. As Judge Wise noted, by operation of the implied-findings doctrine, this finding was presumed against Elisabetta. (In re Marriage of Arceneaux (1990) 51 Cal.3d 1130, 1133 (Arceneaux); Fladeboe v. American Isuzu Motors Inc. (2007) 50 Cal.App.4th 42, 58.) The majority did not mention this at all.

The majority’s opinion here is really quite shocking. On the merits, the appellant took a blind man’s inheritance. An appeal from facts like that is almost guaranteed not to work, particularly when facing an “almost impossible” standard of review.