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Dalla v. Jaffer2/25/2003
Plaintiffs Moussa Dalla and Jack Haddad sued defendant Rashida A. Jaffer seeking recovery of $7500, plus interest and costs for defendant's alleged unauthorized withdrawal of funds from a jointly-held bank account. The trial court entered judgment for plaintiffs after granting reconsideration of their motion for judgment on the pleadings. Defendant appeals. We agree the trial court erred by relying on the doctrine of res judicata to find for plaintiffs and reverse.
FACTS
In 1980, Dalla suffered an injury in a maritime accident. He retained defendant, a lawyer, to represent him on the injury claim and certain immigration matters. Subsequently, Dalla dismissed defendant and retained Haddad, another attorney, to represent him on the injury claim. Defendant filed a notice of lien for her attorney fees.
The injury claim was resolved by a settlement in 1986. Atlas Maritime Company, the entity Dalla sued, agreed to pay $317,000. It issued a draft for $287,000 payable to both plaintiffs, and a second draft for $30,000 jointly payable to plaintiffs and defendant. In return, defendant released her attorney lien.
The parties placed the second draft into a savings account at Great Western Bank (GWB). Haddad and defendant signed an agreement listing both of them as the account holders which, in part, required "withdrawals from, or any activity with respect to the . . . account . . . shall require the signatures of all authorized signers." Shortly thereafter, Dalla filed a declaratory relief action in Los Angeles Superior Court concerning the parties' interests in the GWB account. Defendant cross-complained for recovery of the account funds as her reasonable attorney fees in representing Dalla. That lawsuit ended in 1991 when defendant obtained dismissal of Dalla's complaint for failure to bring it to trial within five years and voluntarily dismissed her cross-complaint.
Between April 1990 and March 1994, defendant unilaterally made four withdrawals from the GWB account, totaling $7,500.
In February 1996, Dalla sought arbitration of who owned the funds then still being held in the account. Defendant and her attorney executed an agreement to arbitrate the issues of "whether [defendant] is entitled to legal fees and," if so, "the amount of any such reasonable attorney's fees." The contract also provided the parties agreed "to waive and give up any and all objections to the jurisdiction of the arbitration panel to make a determination and agree to have a binding judgment entered . . . ."
The panel awarded "Dalla . . . $30,000 plus accrued interest . . . less any taxes paid by [defendant]," and $1,500 in costs. In an attached statement, the arbitrators found defendant's notice of lien "put the parties on notice of claim," but " y late 1991, . . . [defendant] was put on notice that there was a dispute as to her rights to the disputed funds held in the joint account." Thus, defendant "was obligated to bring an independent action to enforce her lien" and, but for the action dismissed in 1991, " ha taken no action to perfect her lien." They concluded "[defendant] was required to take independent legal action to enforce her lien for attorney 's fees and that such an action is now barred by the Statute of Limitations. . . ." The arbitrators' award did not mention or discuss defendant's prior withdrawals from the account.
Dalla moved for entry of judgment on the arbitration award and defendant petitioned to vacate it. In March 1999, the trial court granted Dalla's petition and entered judgment against defendant. She appealed the judgment.
Before confirmation of the arbitration award, plaintiffs filed the c
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