You all remember courts of chancery, right? They were the ones where the chancellor tried equitable issues, without a jury. And the artifact of those courts, of course, is the distinction between “legal issues” and “equitable issues.” In California, and, in most instances, in the Federal courts, the former involve money damages and the parties have the right to a jury trial. The latter involve things like injunctions, declaratory relief and “equitable defenses,” (including those old faves laches, estoppel, waiver, unclean hands, etc.) and are usually tried to the court. The new case of Hoopes v. Dolan (November 12, 2008) ___Cal.App.4th___ does a nice job of summing up what happens in cases with both legal and equitable issues.
Dolans urging, and at Hoopes’ insistence, the trial court conducted a thirteen
day jury trial of the legal issues first.
The jury found for Hoopes and awarded compensatory and punitive
damages. Then, the court tried the
equitable defense of estoppel (which trial looks as though it mostly consisted of
reviewing briefs on both sides and considering the evidence the court had
already heard). As a court of equity,
the court found that Hoopes was equitably estopped from taking the position
that he had exclusive rights to the lot, and, notwithstanding the jury’s
verdict, entered judgment for Dolans and the other tenant.
of Appeal affirmed the judgment, and made the following procedural
- In federal practice, when there are legal and equitable issues, a jury first tries the legal issues, and any remaining equitable issues are then tried to the court. (Beacon Theatres, Inc. v. Westover (1959) 359 U.S. 500, 510-511.)
- Preferred practice in California is exactly the
opposite: The trial court should hear
any equitable issues first, and then convene a jury trial if anything is
left. (Bate v. Marsteller (1965) 232
Cal.App.2d 605, 617.) But failure to follow this preference – as occurred
here – is not reversible.
- In both the state and federal courts, a factual finding by
the first fact finder (judge or jury) is binding on the second. (Raedeke v.
Gibraltar Sav. & Loan Assoc. (1974) 10 Cal.3d 665, 671; Hughes v. Dunlap (1891) 91 Cal. 385, 388-390;
Beacon Theatres, Inc. v. Westover, supra, 359 U.S. 500, 504-505.)
In my experience, most trial courts follow the “preference” for trying the equitable issues first, and when a plaintiff has asserted equitable causes of action in what is, at heart, a contract or other damage case, this presents some pretty interesting tactical questions.