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California State Automobile Association Inter-Insurance Bureau v. Parichan10/31/2000
CERTIFIED FOR PARTIAL PUBLICATION *
PUBLISHED PART
I. INTRODUCTION
Defendant and appellant, Parichan, Renberg, Crossman & Harvey (Parichan) was sued for legal malpractice by plaintiff and respondent, California State Automobile Association Inter-Insurance Bureau (CSAA). A jury awarded CSAA $920,849.05 in damages. Parichan now argues that the trial court should have, but did not, instruct the jury to consider CSAA's legal malpractice claim under the "case-within-a-case" procedure, that the trial court erroneously instructed the jury that Parichan's knowledge of a crucial report could be imputed to CSAA, and that it erred in refusing to instruct the jury on CSAA's contributory negligence. CSAA also contends, in a cross-appeal, that the trial court erred in not awarding it prejudgment interest. We disagree with each of these contentions and, accordingly, affirm the judgment.
II. FACTUAL AND PROCEDURAL BACKGROUND
A. The Underlying Litigation: Carr v. Rosenberg
On August 11, 1988, in Fresno, California, Wolf Rosenberg, a CSAA insured, hit a car driven by Lori Carr, in which her stepson, Michael Carr, a five-year-old boy, was riding. Rosenberg was clearly at fault.
The Carrs retained a Fresno lawyer, Timothy Magill, to represent them. In March 1989, Magill made a $25,000 settlement demand on Michael's behalf. Magill included with the demand a summary of the medical records. These records indicated that Michael's head had hit the dashboard, causing blurred vision and dizziness, a fractured nose and wrist and a cut lip that required 25 stitches. This demand was refused. On August 10, 1989, the Carrs sued Rosenberg. CSAA retained John Krebs, an attorney at Parichan, Renberg, Crossman & Harvey, to represent him.
At first, the case did not seem unusual. Lori Carr's claim settled in late 1990 after her deposition was taken and her medical records were reviewed. Initially, and based on Lori Carr's deposition, Krebs reported to CSAA that Michael's injuries seemed somewhat less severe than his mother's and he seemed to have recovered from them sooner than his mother.
However, at the time Lori Carr's claim settled, Magill advised Krebs that he would not be able to settle Michael's claim "because of serious behavioral problems he is having." Krebs promptly reported this development to CSAA: "In other words, Mrs. Carr and Mr. Magill want to make sure that these problems were not due to the boy's involvement in the subject accident."
A different picture of Michael began to emerge a year later (Michael was now eight years old), when Krebs received from Magill a copy of a report from a psychiatrist, Kathy Sullivan. Sullivan was asked by Magill to summarize in this report her clinical assessment of Michael and to address "the relationship of his current problems to the car accident that he was involved in at age five."
In this report, dated September 23, 1991, she provided Magill with her "working hypothesis" about Michael: "Michael was born into the world with neurologic vulnerability either due to prenatal factors or post-natal trauma of which there was some. I believe that as a young child he was suffering from a major depression that has continued throughout his childhood. I also believe that at age five he sustained a head injury that in all likelihood contributed to a marked increase in his pathology and the level of disturbance. I believe that prior symptoms were exacerbated, and Michael has suffered from a organic personality syndrome subsequent to that injury." She also noted that until Michael was twelve or thirteen it would be difficult to confirm this hypothesis b
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