California Jury Instruction CACI 4106 Breach of Fiduciary Duty by Attorney—Essential Factual Elements

New September 2003; Revised April 2004; Renumbered from CACI No. 605 December 2007; Revised May 2019, May 2020

Nakase Wade | California Business Lawyers & Corporate Lawyers

The existence of a fiduciary relationship is a question of law. Whether an attorney has breached that fiduciary duty is a question of fact. (David Welch Co. v. Erskine & Tulley (1988) 203 Cal.App.3d 884, 890 [250 Cal.Rptr. 339], disapproved on other grounds in Lee v. Hanley (2015) 61 Cal.4th 1225, 1239 [191 Cal.Rptr.3d 536, 354 P.3d 334].)

Give CACI No. 430, Causation: Substantial Factor, with this instruction.

The causation standard for an attorney’s intentional breach of fiduciary duty differs from that for a negligent breach. If the plaintiff alleges an attorney’s intentional breach of duty, do not include the optional last sentence of CACI No. 430, Causation: Substantial Factor, on “but for” causation. The “but for” causation standard does not apply to an intentional breach of fiduciary duty. If the plaintiff alleges an attorney’s negligent breach of duty, the “but for” (“would have happened anyway”) causation standard applies. (Knutson v. Foster (2018) 25 Cal.App.5th 1075, 1093–1094 [236 Cal.Rptr.3d 473]; see Viner v. Sweet (2003) 30 Cal.4th 1232 [135 Cal.Rptr.2d 629, 70 P.3d 1046].) If the plaintiff alleges a negligent breach of duty, give the optional last sentence of CACI No. 430: “Conduct is not a substantial factor in causing harm if the same harm would have occurred without that conduct.”

If the plaintiff alleges both negligent breach and intentional or fraudulent breach, the jury must be instructed on both causation standards and it should be made clear which causation standard applies to which claim.

If the harm allegedly caused by the defendant’s conduct involves the outcome of a legal claim, the jury should be instructed with CACI No. 601, Damages for Negligent Handling of Legal Matter, for the “but for” standard. (See Gutierrez v. Girardi (2011) 194 Cal.App.4th 925, 928, 933–937 [125 Cal.Rptr.3d 210] [discussing circumstances when a client need not show that they objectively would have obtained a better result in the underlying case in the absence of the attorney’s breach (the trial-within-a-trial method)].)

•“ ‘The relation between attorney and client is a fiduciary relation of the very highest character.’ ” (Neel v. Magana, Olney, Levy, Cathcart & Gelfand (1971) 6 Cal.3d 176, 189 [98 Cal.Rptr. 837, 491 P.2d 421].)

•“ ‘The breach of fiduciary duty can be based upon either negligence or fraud depending on the circumstances. It has been referred to as a species of tort distinct from causes of action for professional negligence [citation] and from fraud [citation].’ ‘The elements of a cause of action for breach of fiduciary duty are the existence of a fiduciary relationship, breach of fiduciary duty, and damages.’ ” (Knutson, supra, 25 Cal.App.5th at pp. 1093–1094, internal citation omitted.)

•“Substantial factor causation is the correct causation standard for an intentional breach of fiduciary duty.” (Knutson, supra, 25 Cal.App.5th at p. 1094.)

•“The trial court applied the legal malpractice standard of causation to [plaintiff]’s intentional breach of fiduciary duty cause of action. The court cited The Rutter Group’s treatise on professional responsibility to equate causation for legal malpractice with causation for all breaches of fiduciary duty: ‘ “The rules concerning causation, damages, and defenses that apply to lawyer negligence actions … also govern actions for breach of fiduciary duty.” ’ This statement of the law is correct, however, only as to claims of breach of fiduciary duty arising from negligent conduct.” (Knutson, supra, 25 Cal.App.5th at p. 1094, internal citations omitted.)

•“Expert testimony is not required, but is admissible to establish the duty and breach elements of a cause of action for breach of fiduciary duty where the attorney conduct is a matter beyond common knowledge.” (Stanley, supra, 35 Cal.App.4th at p. 1087, internal citations omitted.)

•“The scope of an attorney’s fiduciary duty may be determined as a matter of law based on the Rules of Professional Conduct which, ‘together with statutes and general principles relating to other fiduciary relationships, all help define the duty component of the fiduciary duty which an attorney owes to his [or her] client.’ ” (Stanley, supra, 35 Cal.App.4th at p. 1087.)