Opinions
Filed 12/19/24
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION THREE
LAURA LAZAR, B321752
Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. 19STCV17351)
v.
LYNETTE BISHOP et al.,
Defendants and
Respondents.
APPEAL from a judgment of the Superior Court of
Los Angeles County, Steven J. Kleifield, Judge. Reversed with
directions.
Law Office of Robert S. Gerstein, Robert S. Gerstein;
Morris S. Getzels Law Office, and Morris S. Getzels for Plaintiff
and Appellant.
Manning & Kass, Ellrod, Ramirez, Trester, Frederic W.
Trester, Steven J. Renick, and Antoinette M. Marino for
Defendants and Respondents.
Brian A. Manson, Neil Kalin, and Joseph Yoon for
California Association of Realtors as Amicus Curiae in support of
Defendants and Respondents.
_________________________
Laura Lazar (plaintiff) sued real estate brokers Lynette
Bishop, Shen Shulz, Sotheby’s International Realty, Inc.
(Sotheby’s), and Shen Realty, Inc. (collectively, defendants) for
breach of the fiduciary duty defendants owed to plaintiff’s father
in connection with the sale of his Malibu house (the house). The
complaint alleged that plaintiff’s father assigned plaintiff his
causes of action arising from the listing and sale of the house.
The trial court granted defendants’ motion for summary
judgment, concluding plaintiff lacked standing to sue because the
cause of action for breach of fiduciary duty was not assignable
under Civil Code section 954.1
Plaintiff appeals from the judgment entered in favor of
defendants and urges us to find her sole cause of action
assignable. As a matter of first impression, we hold that
plaintiff’s cause of action for breach of the real estate brokers’
fiduciary duties, which seeks only damages related to property
rights and pecuniary interests, is assignable. We reverse the
grant of summary judgment and remand for the trial court to
consider the remaining grounds argued in defendants’ motion.
1 All undesignated statutory references are to the Civil Code.
2
FACTUAL AND PROCEDURAL BACKGROUND
I. Sale of the House
In 2006, Daniel Gottlieb purchased the house for
$3,452,500. Gottlieb’s daughter, plaintiff, subsequently lived
there. In November 2016, Gottlieb engaged Bishop, a Sotheby’s
real estate agent, to sell the house. Bishop listed the house for
sale for $4.2 million. Thereafter, Bishop persuaded Gottlieb to
drop the listing price to $3,995,000, and then to $3,150,000, the
price at which William and Stephanie Spalding bought the house.
Allegedly unbeknownst to Gottlieb, the Spaldings’ broker, Shen
Shulz, was also a Sotheby’s agent.
II. The Lawsuit
In May 2019, plaintiff sued defendants, alleging a single
cause of action for breach of fiduciary duty. The complaint stated
that Gottlieb had assigned all of his rights and causes of action
arising from the listing and sale of the house to plaintiff. The
complaint alleged that per the listing agreement, Bishop owed
Gottlieb a fiduciary duty “to make the fullest disclosure of all
material facts that might affect [Gottlieb’s] interest, and owed to
[Gottlieb] a fiduciary duty of utmost care, integrity, honesty and
loyalty in dealings with” Gottlieb. This duty included placing
Gottlieb “on notice if any realtor involved in the sale of [the
house] was a dual agent, i.e. working for both the buyer and the
seller,” obtaining Gottlieb’s consent to any dual agency, not
disclosing to the buyer’s agent that Gottlieb would accept less
than the asking price, and attempting to sell the house at the
highest possible price.
The complaint alleged that neither Bishop nor Schulz
informed Gottlieb that there was a dual agency until Gottlieb was
3
already in a binding sale contract with the Spaldings. Plaintiff
further alleged that Bishop breached her fiduciary duty by not
working to obtain the highest possible sale price, failing to
market the property to make it competitive, and coaxing Gottlieb
to twice lower the listing price. The complaint stated that Bishop
informed Schulz that Gottlieb “would lower the price and that
[Gottlieb] would sign whatever document Defendant Bishop
wanted him to sign and told him to sign.” Plaintiff alleged that
the house would have sold for more than the $3,150,000 that the
Spaldings paid, and closer to $5,200,000, had the fiduciary duty
not been breached. Plaintiff sought the following damages:
$157,500, the amount of commission that defendants were paid in
the house sale; $2,050,000, the amount greater than the sale
price that would have been paid had defendants not allegedly
breached their fiduciary duty (based on the home’s alleged true
value at the time of the sale); $12,954, the amount spent
preparing the house for sale; and interest on the damages and
the costs of suit incurred by plaintiff.
III. Motion for Summary Judgment
In July 2019, defendants answered the complaint. In
February 2021, defendants moved for summary judgment.
Defendants’ central contention was that plaintiff lacked standing
to bring suit because “a chose in action for breach of fiduciary
duty against a real estate broker/agent is not assignable.”2
2 According to Black’s Law Dictionary, a “chose in action” is
“1. A proprietary right in personam, such as a debt owed by
another person, a share in a joint-stock company, or a claim for
damages in tort. 2. The right to bring an action to recover a debt,
money, or thing. 3. Personal property that one person owns but
4
Defendants argued that breach of the fiduciary duty against a
real estate broker was a highly personalized right of recovery
that could not be assigned. Noting that the assignability of a
claim for breach of fiduciary duty against a real estate broker had
not been addressed by case law, defendants likened the cause of
action to a legal malpractice claim, which is generally
unassignable. Defendants also argued that Gottlieb lacked
capacity to assign the chose in action and that plaintiff could not
prove defendants breached a fiduciary duty.3
Plaintiff opposed summary judgment, in part arguing that
the cause of action for breach of fiduciary duty was assignable
pursuant to sections 953 and 954. She argued the cases cited by
defendants were not applicable and that the relationship between
a real estate broker and client was not analogous to the attorney-
client relationship.
The trial court granted summary judgment, concluding
that plaintiff lacked standing. The court found:
“The nature of the relationship between the principal and
the real estate licensee is indeed analogous to that of the
relationship between an attorney and client. This relationship
includes the highest level of good faith, undivided service and
loyalty, the duty to investigate, learn, and counsel and advise the
another person possesses, the owner being able to regain
possession through a lawsuit.” (Black’s Law Dict. (12th ed. 2024.)
p. 304.)
3 We do not go into the details of these two arguments as the
trial court granted summary judgment based on plaintiff’s lack of
standing and did not consider the other grounds, and the parties
do not argue these grounds on appeal.
5
client, to disclose reasonably obtainable information, and not put
his or her interests ahead of the client. As in the case of
attorneys, the nature of the relationship distinguishes itself from
the typical assignment of a collection case, for example, where
parties have engaged in arms-length transactions.
“Additionally, the same policy considerations would apply
to the assignment of lawsuits against real estate licensees,
including the commercialization of claims, the need to defend
against claims brought by parties with whom they had no prior
relationship, encouragement of unjustified lawsuits, an increase
in the number of lawsuits, burdening of the profession and the
court system, and creation of barriers to access to real estate
licensees through increased malpractice premiums and the
concomitant effect on the cost of services and property sales.
“The Court is convinced that an action for breach of
fiduciary duty against a real estate licensee is not assignable.”
Because the court concluded plaintiff lacked standing, it did not
address the remaining grounds for summary judgment.
Plaintiff filed a motion for reconsideration of the court’s
ruling on the summary judgment motion, which the trial court
denied. The trial court then granted defendants’ motion for
$148,211 in attorney fees. In February 2022, the court entered
judgment against plaintiff and in favor of defendants. In May
2022, plaintiff moved for a new trial, which the trial court denied.
Plaintiff appealed.
DISCUSSION
This appeal presents a matter of first impression: whether
the cause of action for a breach of a real estate broker’s fiduciary
duty is assignable. Plaintiff argues we should reverse the
granting of summary judgment because the claim is assignable
6
and she thus has standing. As we explain below, we agree that
the cause of action for breach of a real estate broker’s fiduciary
duty is assignable when it seeks damages solely related to
property and pecuniary interests.4
Before we discuss the substantive issues, we first address
the timeliness of plaintiff’s appeal.
I. Plaintiff’s Notice of Appeal Was Timely Filed
On June 8, 2022, plaintiff’s counsel electronically submitted
a notice of appeal and it was received on that date by the superior
court. On June 13, 2022, plaintiff’s counsel was notified by the
clerk that the notice of appeal was rejected because of counsel’s
failure to use the proper category in the dropdown menu for the
electronic filing. Plaintiff resubmitted the notice of appeal on
June 13, 2022. The trial court then dated the notice of appeal as
having been filed on June 13, 2022.
On August 10, 2022, we sent the parties a letter asking
plaintiff to demonstrate in writing why her appeal should not be
dismissed as having been untimely filed because the notice of
appeal was dated June 13, 2022, four days after the June 9, 2022
filing deadline. The parties briefed the issue, and we deferred
ruling on the issue until now. Plaintiff argued that her notice of
appeal was rejected for a technical reason and should be deemed
timely filed. Defendants argued “the untimely filing is ‘not
4 On August 2, 2024, California Association of Realtors
requested permission to file and lodged with this court an amicus
brief in support of defendants. We now grant California
Association of Realtors permission to file the brief and have
considered its arguments, which largely echo those made by
defendants.
7
remediable’ ” since it was not caused by a technical problem with
the filing system but rather by counsel’s mistake.
After reviewing the exhibits filed by plaintiff showing the
facts explained above, we deem plaintiff’s notice of appeal timely
filed. It appears plaintiff submitted the notice of appeal to the
superior court before the filing deadline, the superior court
rejected it due to a technical issue with the electronic filing, and
plaintiff’s counsel promptly refiled the notice of appeal the same
day counsel received the superior court’s rejection of the original
filing. (See Garg v. Garg (2022) 82 Cal.App.5th 1036, 1042
[notice of appeal may be deemed timely when appellant
attempted to electronically file the document prior to the
expiration of the deadline and then showed diligence in promptly
filing the notice of appeal after the failed attempt]; see also
Pangilinan v. Palisoc (2014) 227 Cal.App.4th 765, 769–770
[appeal deemed timely where the notice of appeal delivered to the
clerk’s office within the requisite period but rejected by the clerk
because of a problem with the filing fee]; Rapp v. Golden Eagle
Ins. Co. (1994) 24 Cal.App.4th 1167, 1172 [presentation of the
notice of appeal to the clerk within the requisite period rendered
it timely despite the error regarding the filing fee].) We therefore
turn to the merits of the appeal.
II. Standard of Review
Summary judgment is designed to cut through the parties’
pleadings to determine whether trial is necessary to resolve the
dispute. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826,
843.) A motion for summary judgment shall be granted “if all the
papers submitted show that there is no triable issue as to any
material fact and that the moving party is entitled to a judgment
as a matter of law.” (Code Civ. Proc., § 437c, subd. (c).) On
8
appeal from a summary judgment, we review the record de novo
to determine whether triable issues of material fact exist.
(Saelzler v. Advanced Group 400 (2001) 25 Cal.4th 763, 767.) We
likewise review de novo the issue of whether plaintiff has
standing to pursue her claims. (Loeber v. Lakeside Joint School
District (2024) 103 Cal.App.5th 552, 570 [“Standing is a question
of law that courts typically review de novo.”].)
III. Applicable Law
a. Standing
“The question of standing to sue is one of the right to relief
and goes to the existence of a cause of action against the
defendant.” (Payne v. United California Bank (1972) 23
Cal.App.3d 850, 859.) Under Code of Civil Procedure section 367,
“[e]very action must be prosecuted in the name of the real party
in interest.” “[T]he real party in interest is the party who has
title to the cause of action, i.e., the one who has the right to
maintain the cause of action”—“the owner of the cause of action.”
(Vaughn v. Dame Construction Co. (1990) 223 Cal.App.3d 144,
147–148.) “An assignee of an assignable chose in action has
taken legal title and ‘may sue in his or her own name.’
[Citations.] Any assignment ‘merely transfers the interest of the
assignor. The assignee “stands in the shoes” of the assignor,
taking his or her rights and remedies, subject to any defenses
that the obligor has against the assignor prior to notice of the
assignment.’ ” (Dagher v. Ford Motor Co. (2015) 238 Cal.App.4th
905, 925 (Dagher).)
b. Assignability Is the Rule
The assignability of choses in action originated in the
common law. (Essex Ins. Co. v. Five Star Dye House, Inc. (2006)
9
38 Cal.4th 1252, 1259 (Essex Ins.).) In California, the right to
assign a chose in action was codified in 1872 by section 954,
which states: “A thing in action, arising out of the violation of a
right of property, or out of an obligation, may be transferred by
the owner.” (See Essex Ins., at p. 1259 [date of codification].) A
“thing in action is a right to recover money or other personal
property by a judicial proceeding.” (§ 953.) Enactment of section
954 “had the effect of liberalizing restrictions on the types of
actions that may be assigned to a third party” such that in
general, “assignability is the rule.” (Essex Ins., at p. 1259.)
Applying this rule, courts have consistently found rights of
recovery founded in property or pecuniary interests assignable.
(See, e.g., Schaffter v. Creative Capital Leasing Group, LLC
(2008) 166 Cal.App.4th 745, 756 [breach of contract]; Stapp v.
Madera Canal & Irrigation Co. (1917) 34 Cal.App. 41, 46–47
[damage to real property]; Staley v. McClurken (1939) 35
Cal.App.2d 622, 625 [conversion or damage to personal property];
Estate of Baker (1915) 170 Cal. 578, 587–588 [will contests];
McLaughlin v. National Union Fire Ins. Co. (1994) 23
Cal.App.4th 1132, 1147 (McLaughlin) [fraud assignable when
connected to property or something that has a legal existence and
value independent of the right to sue for fraud].)
However, there are two categories of exceptions to the
general rule of assignability. First, “highly personalized rights of
recovery are not assignable.” (Dagher, supra, 238 Cal.App.4th at
p. 926.) Highly personalized causes of action typically involve
“wrongs done to the person, the reputation or the feelings of an
injured party.” (AMCO Ins. Co. v. All Solutions Ins. Agency, LLC
(2016) 244 Cal.App.4th 883, 892 (AMCO).) Second, legal
malpractice claims are not assignable. (Fireman’s Fund Ins. Co.
10
v. McDonald, Hecht & Solberg (1994) 30 Cal.App.4th 1373, 1383
(Fireman’s Fund).)
c. Exception for Highly Personalized Rights of
Recovery
As mentioned, tort causes of action for personal injury,
emotional damage, or reputational damage are not assignable.
(AMCO, supra, 244 Cal.App.4th at p. 892; Reichert v. General Ins.
Co. (1968) 68 Cal.2d 822, 834 [Highly personal causes of action
that may not be assigned include “ ‘ “slander, assault and battery,
negligent personal injuries, criminal conversation, seduction,
breach of marriage promise, malicious prosecution, and others of
like nature.” ’ ”].) This first exception to assignability focuses on
the personal nature of the damages sought by the assignee.
For example, in Timed Out, LLC v. Youabian, Inc. (2014)
229 Cal.App.4th 1001, two models assigned the plaintiff their
rights to sue for misappropriation of their images after
discovering their images were being used in advertisements for
the defendants’ cosmetic medical services. The plaintiff filed a
complaint against the defendants, alleging causes of action for
common law and statutory misappropriation of likeness. The
defendants moved for judgment on the pleadings, arguing that
the plaintiff did not have standing to sue on behalf of the models
because the models’ privacy rights were personal and could not be
assigned. (Id. at pp. 1004–1005.) The trial court granted the
defendants’ motion and entered judgment in favor of the
defendants. (Id. at p. 1005.) On appeal, the court concluded that
a cause of action for misappropriation of likeness was assignable.
(Id. at pp. 1009–1010.) Since the plaintiff sought to recover only
pecuniary damages for the defendants’ alleged commercial
11
misappropriation of the models’ likenesses, the right of action
was not personalized. (Id. at pp. 1010–1011.)
Likewise, the Supreme Court in Murphy v. Allstate Ins. Co.
(1976) 17 Cal.3d 937, 942, concluded that a bad faith cause of
action against an insurer was not assignable because it sought
both assignable (the actual value of policy benefits) and
nonassignable (emotional distress and punitive) damages. By
contrast, in Essex Ins., supra, 38 Cal.4th at pp. 1263–1264, the
Supreme Court found a bad faith claim against an insurer
assignable where the assignee plaintiff sought only the monetary
value of the policy benefits wrongfully withheld by the insurer
and did not seek “damages for emotional distress or punitive
damages, or damages for injury to reputation or other personal
interests.”
d. Exception for Legal Malpractice Claims
The second well-established exception to assignability is for
legal malpractice actions. “California courts have consistently
held legal malpractice claims are nonassignable to protect the
integrity of the uniquely personal and confidential attorney-client
relationship.” (Fireman’s Fund, supra, 30 Cal.App.4th at
p. 1383.) “[A]lthough choses in action for property or pecuniary
losses are generally assignable, a claim for legal malpractice is
more akin to those types of claims which are not assignable, i.e.,
claims for personal injury, wrongs of a purely personal nature
(such as injuries to the reputation or feelings of the injured party)
or breaches of contracts of a purely personal nature (such as
promises of marriage). [Citation.] . . . [T]he attorney-client
relationship (although containing contractual elements) is unique
and involves a highly personal and confidential relationship,
making the relationship ‘. . . more analogous to a contract of a
12
personal nature than to an ordinary commercial contract’
[citation], and rendering claims for negligent breach thereof
nonassignable.” (Kracht v. Perrin, Gartland & Doyle (1990) 219
Cal.App.3d 1019, 1023 (Kracht); Goodley v. Wank & Wank, Inc.
(1976) 62 Cal.App.3d 389, 394 [same].)
Attorneys owe clients “a duty of undivided loyalty and
diligence in representing the client. Such duty is personally owed
by the attorney and may not be delegated to others, and is owed
solely to the client, [the attorney’s] one intended beneficiary.
Assignability would encourage commercialization of claims, and
would force attorneys to defend themselves against persons to
whom no duty was ever owed. Moreover, the legal profession is
debased by such commercialization, because it could
(1) encourage unjustified lawsuits; (2) generate increased
malpractice lawsuits, burdening the profession, the court system
and (to the extent malpractice premiums would inevitably rise
and be passed to the consumers) the public; and (3) promote
champerty. [Citation.] Assignability could conceivably reduce
the public’s access to legal services, since the ever present threat
of assignment by irresponsible clients (seeking quick financial
gain) could cause lawyers to evaluate more selectively the
desirability of representing a particular client.” (Kracht, supra,
219 Cal.App.3d at pp. 1023–1024.)5
5 In White Mountains Reinsurance Co. of America v. Borton
Petrini, LLP (2013) 221 Cal.App.4th 890, 908–909, the Court of
Appeal recognized a narrow exception to the prohibition on
assignment of legal malpractice claims where the assignment
was part of a larger commercial transaction between insurance
companies and therefore the policy concerns related to an
assignment were not implicated.
13
IV. A Claim for Breach of Fiduciary Duty Against Real
Estate Brokers Seeking Damages Solely Related to
Property and Pecuniary Interests Is Assignable
Here, plaintiff sued defendants for breaching their
fiduciary duty to Gottlieb by not disclosing the dual agency and
not working to obtain the highest possible sale price. It is well
established that a real estate broker owes a fiduciary duty to her
client, which “requires the highest good faith and undivided
service and loyalty.” (Field v. Century 21 Klowden-Forness Realty
(1998) 63 Cal.App.4th 18, 25.) “A fiduciary must tell its principal
of all information it possesses that is material to the principal’s
interests. [Citations.] A fiduciary’s failure to share material
information with the principal is constructive fraud, a term of art
obviating actual fraudulent intent.” (Michel v. Moore &
Associates, Inc. (2007) 156 Cal.App.4th 756, 762.)
“ ‘ “Constructive fraud is a unique species of fraud applicable only
to a fiduciary or confidential relationship.” [Citation.] [¶] “[A]s a
general principle constructive fraud comprises any act, omission
or concealment involving a breach of legal or equitable duty, trust
or confidence which results in damage to another even though the
conduct is not otherwise fraudulent. Most acts by an agent in
breach of his fiduciary duties constitute constructive fraud. The
failure of the fiduciary to disclose a material fact to his principal
which might affect the fiduciary’s motives or the principal’s
decision, which is known (or should be known) to the fiduciary,
may constitute constructive fraud.” ’ ” (Assilzadeh v. California
Federal Bank (2000) 82 Cal.App.4th 399, 415.)
Thus, plaintiff’s action for breach of a fiduciary duty boils
down to a claim for constructive fraud. We therefore address
14
whether this constructive fraud claim falls under either of the
two exceptions to assignability.
a. Plaintiff’s Claim Does Not Involve a Highly
Personalized Right of Recovery
Courts have consistently found that claims for fraud do not
involve highly personalized rights of recovery where the fraud is
connected to property or something that has a legal existence and
value independent of the right to sue for fraud. (McLaughlin,
supra, 23 Cal.App.4th at p. 1147 [claims regarding insurer’s
fraudulent behavior leading to breaches of duties to defend and to
pay judgments against insureds in underlying investment fraud
action were assignable]; Osuna v. Albertson (1982) 134
Cal.App.3d 71, 83–84 [fraud and negligent misrepresentation
claims assignable when related to real property]; Wikstrom v.
Yolo Fliers Club (1929) 206 Cal. 461, 464 [purchaser could assign
his fraud cause of action that alleged a misrepresentation about
the number of acres of real property being sold].)
Here, plaintiff’s claim is closely tied to real property (the
house) and a pecuniary interest in the proceeds from the house’s
sale. Plaintiff pled damages attributable only to the commission
paid to defendants, the money spent preparing the home for sale,
and the amount greater than the sale price that would have been
paid had defendants not allegedly breached their fiduciary duty.
Plaintiff therefore is not seeking personalized relief, e.g.,
damages for emotional distress, reputational damage, or physical
injuries. On the spectrum of unassignable (highly personalized)
and assignable (based in property and pecuniary rights) claims,
this fraud claim lands solidly on the side of assignability.
Defendants contend “the alleged failure to disclose the dual
agency was a personal, rather than pecuniary, loss.” We
15
disagree. Plaintiff did not seek categories of relief too personal to
assign. On the contrary, plaintiff’s alleged losses are grounded in
the money that allegedly should have been earned from the
property’s sale, not from violation of personalized rights.
Citing Superbrace, Inc. v. Tidwell (2004) 124 Cal.App.4th
388, 396 and Manela v. Stone (2021) 66 Cal.App.5th 90, 107–108,
defendants contend that Gottlieb could not assign the cause of
action because the brokers’ contract imposed personal
obligations. Manela, at pages 107–108, makes the point that
contractual duties of a personal nature are nondelegable,
especially where “ ‘the personal quality of the party was a
material inducement to the other party entering into the
contract.’ ” Superbrace, at page 396, similarly states, “ ‘the duties
imposed upon one party may be of such a personal nature that
their performance by someone else would in effect deprive the
other party of that for which he bargained. The duties in such a
situation cannot be delegated. [Citation.] Rights likewise cannot
be assigned if the assignment would materially impair the
nonassigning party’s chance of obtaining the performance he
expected.’ ”
However, this case does not deal with the assignment of
defendants’ personal duties under the contract. The contract
itself has already been performed—there are no duties to assign.
The assignment here is related to Gottlieb’s right to monetary
damages for defendants’ failure to disclose pertinent information
in a sales transaction. As explained above, such a chose in action
is assignable.
16
b. The Real Estate Broker’s Fiduciary
Relationship Is Distinguishable from the
Attorney-Client Relationship
Defendants also contend that because real estate agents
have a relationship of “trust and confidence” with the client and
owe the client “the highest good faith and undivided service and
loyalty,” a claim for breach of fiduciary duty is too personal to be
assignable. Defendants liken a broker’s fiduciary duty to the
attorney-client relationship, and assert that like malpractice
claims, the breach of a fiduciary duty against a real estate broker
is not assignable.
In Troost v. Estate of DeBoer (1984) 155 Cal.App.3d 289
(Troost), the Court of Appeal declined to expand the assignability
exception for legal malpractice claims to insurance brokers. The
court noted the special nature of legal services and concluded
that the unique concerns associated with legal malpractice claims
were not present in the case against the insurance broker. (Id. at
p. 297) The court pointed out that unlike the attorney-client
relationship, the “procurement of insurance through a broker or
agent is a commercial transaction with intended beneficiaries
beyond the client alone.” (Ibid.) In AMCO, supra, 244
Cal.App.4th at page 890, defendant insurance brokers similarly
urged the appellate court “to treat causes of action against an
insurance broker in the same manner as malpractice causes of
action against an attorney and conclude the causes of action are
not assignable.” Citing Troost, the court likewise declined.
Noting “the unique quality of legal services, the personal nature
of the attorney’s duty to the client and the confidentiality of the
attorney-client relationship,” the court concluded “those factors
17
were not present in the client-broker relationship before it.”
(AMCO, at p. 893.)
As in Troost and AMCO, there are significant differences
here between the client relationships for attorneys and for real
estate brokers. We conclude that such differences do not support
excepting breach of fiduciary duty causes of action from
assignment. Like with insurance brokers, the real estate broker’s
relationship to the client centers entirely around a transaction.
The broker’s fiduciary duty to the client is thus tied to property
and pecuniary interests involved in the transaction. Moreover,
the transaction benefits not only the real estate broker’s selling
client but also the broker, the buyer, and the buyer’s agent. It is
because of the transactional nature of the broker’s service to the
client that real estate brokers can act as dual agents. (Horiike v.
Coldwell Banker Residential Brokerage Co. (2016) 1 Cal.5th 1024,
1030 [brokers can be dual agents after disclosure to the client and
client’s consent].)
In contrast, the attorney-client relationship goes beyond
transactional support. The attorney-client relationship is built
on legal counsel and advocacy, and often involves more sensitive,
confidential matters like criminal defense, family law, or
business litigation. The attorney’s service is unattached to
property, and wholly bound to the client. As a result, any right to
recovery is extremely personal to that client.
Unlike real estate brokers, attorneys cannot act as dual
agents representing both plaintiffs and defendants in the same
lawsuit because of the personalized service they provide to their
clients. (See Rules Prof. Conduct, rule 1.7 [lawyer prohibited
from representing a client if there is a significant risk that
lawyer’s responsibilities to another client will materially limit the
18
lawyer’s ability to represent the current client].) The
personalized nature of the relationship is further evidenced by
the fact that attorneys are held to a higher standard of
confidentiality than real estate brokers, one that makes
confidential attorney-client communications privileged. (See
Costco Wholesale Corp. v. Superior Court (2009) 47 Cal.4th 725,
734 [“The attorney-client privilege attaches to a confidential
communication between the attorney and the client and bars
discovery of the communication irrespective of whether it
includes unprivileged material.”]; Evid. Code, § 954 [lawyer-client
privilege]; see Bus. & Prof. Code, § 6068, subd. (e)(1) [attorneys
must “maintain inviolate the confidence, and at every peril to
himself or herself to preserve the secrets, of his or her client”].)
No such privilege exists for brokers.
Because plaintiff’s lawsuit does not seek personalized relief,
assignment of the breach of the fiduciary duty cause of action
does not raise the policy concerns associated with assignment of a
legal malpractice cause of action. And, as this is seemingly the
first instance where the assignability of a cause of action for
breach of a real estate broker’s fiduciary duty has been raised
since section 954’s codification in 1872, we do not have concerns
that our ruling will encourage unjustified litigation, generate
increased breach of fiduciary duty lawsuits, burden the real
estate profession, or promote champerty. (See Kracht, supra, 219
Cal.App.3d at pp. 1023–1024 [stating policy reasons behind
exception to assignment of legal malpractice claims].)
Based on the foregoing, we conclude that plaintiff’s cause of
action for breach of the real estate brokers’ fiduciary duties,
which seeks damages only related to property rights and
pecuniary interests, is assignable. Plaintiff therefore has
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standing to pursue this lawsuit based on the allegations in the
complaint.
DISPOSITION
The judgment is reversed. On remand, the trial court is to
consider defendants’ remaining grounds for summary judgment.6
Plaintiff and appellant Laura Lazar is awarded her costs on
appeal.
CERTIFIED FOR PUBLICATION
EDMON, P. J.
We concur:
ADAMS, J.
BERSHON, J.*
6 We make no comment on the merits of the remaining
grounds for summary judgment, which were not argued in the
appellate briefs. We have refrained from reviewing them to give
the trial court the first opportunity to evaluate the arguments
and evidence.
* Judge of the Los Angeles Superior Court, assigned by the
Chief Justice pursuant to article VI, section 6 of the California
Constitution.
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