We encounter contracts literally every day and much more often that it would at first appear.  Some of the contracts we entered into are obvious such as our residential and commercial lease agreements, purchase receipts with a return policy, while other contracts less apparent, such as statements of terms and disclosures at the back of our bank and credit card statements, and the ever more common "click through" agreements we have to digitally sign when we use various online services.   

What is "contract?"

The term "contract" might sound "self explanatory" and not requiring any special definition. However, it is important to understand the difference between a regular agreement and an actual contract. By definition, a contract is an agreement enforceable in law. That is, if the contract is breached, certain remedies will be available to the aggrieved party that can be recovered through administrative, judicial or alternative resolution system. To illustrate the difference, imagine the following situation: you agree with your friend that you will meet tomorrow at 8 pm near this movie theatre and you will be watching a movie together. Comes 8 pm tomorrow, and your friend doesn't show up. Do you have any rights against your friend? Can you seriously consider suing him? Obviously not. That agreement is not enforceable in law, and no judge will consider this to be a breach of contract that entitles you to recovery. To be a valid contract, it has to create a relationship between parties that is recognized by law and therefore can be enforced.

The second fundamental feature of a valid contract is that it has to contain mutuality of obligations. In other words, both/all parties to a contract must "bargain" for a deal and must give something up that they are entitled to in order to receive the benefit of that bargain. For instance, if a father promises his son that he will buy him a car for his birthday, this promise doesn't form a contract, because while the father "bargained" with his son by imposing upon himself an obligation to buy a car, his son didn't bargain for that offer and didn't agree to provide any benefit to his father in return for the promised car. 

If the son promised to pay his father a certain amount of money of that car, it would clearly create an obligation in the sun to pay and the contract would be formed. But what if the father told his son: "I will buy you a car by the end of the year if you promise not to smoke until then." - at first this doesn't seem to be different from the previous example. However, it is. In this example the obligation is mutual and therefore a contract is formed. Although quitting to smoke might not sound like a significant obligation (certainly not like paying the vehicle's price), it is a valid obligation because the son is about to give up something to what he is legally entitled and is free to do - smoking. 

Are oral contracts valid? 

Generally, it's always a good idea to memorialize the terms of any agreement in writing. This helps avoiding confusion, misunderstanding, lack of clarity in terms and also allows people not to rely on their memory for remembering what they agreed on. 

However, an oral agreement can be a perfectly valid and fully enforceable contract. This is usually the case when the conduct of the parties suggests that they must have had an agreement about their relationship. For instance, if a workers gets hired by his employer without signing any written employment contract or a similar document, a contractual employee-employer relationship is still created. The parties might later disagree about the terms of employment, compensation, etc., but if the employee presents evidence of performing work for the employer, lack of written contract will not relieve the employer from his obligation to pay his employee wages and fulfill other duties of a reasonable employer. 

Certain contracts must be in writing under the "statute of frauds:" the most common are: a transaction for sale of goods totalling over $500, a contract that will necessarily take a year or longer to perform (such as lease agreement for a year or longer), marriage, divorce, land transactions, and a promise to pay for debts of another (surety/loan guarantee). 

Another significant defense available in the absence of actual contract is "promissory estoppel." Under this theory, a party who reasonably relies on the promise of the other party and substantially changes his position to its detriment in reliance to that promise, will be entitled to be compensated for damages sustained if the promise is not upheld by the second party.  For instance, if an East Coast company hires an employee who currently lives on the West coast, and who, in a reasonable reliance to be employed for a certain period of time, quits his job, sells his house, leaves everything behind and moves across the country, he will be entitled to a certain compensation if his prospective East Coast employer changes his mind and doesn't hire him. At a minimum, the worker will have to be compensated for moving and losing wages that he would have reasonably been earning at his prior work place that he quit hoping to get this new job.

Many clients are not aware of their most fundamental rights when being represented by an attorney and what duties attorneys owe to their clients as a matter of law and the code of ethics. This lack of knowing your rights and your lawyer’s duties in an attorney-client relationship can hurt you as a client but not allowing you to fully enjoy the benefits of legal representation and knowing what protections you, as a client are entitled to. Here are a few basic yet very important rights that you have as a client when retaining and attorney and attorney’s duties to you as a client:

1. Attorney’s duty to communicate - your lawyer must keep you reasonably informed of any developments that are taking place in your case. Your attorney must also be prompt it returning your communication (phone calls, e-mails and letters).

2. Attorney-Client Privilege / Duty of Confidentiality. Your attorney has a duty to keep all communications (verbal, in writing or otherwise) confidential and not reveal your confidences. A communication is confidential if it is made in a course of your professional relationship with an attorney regarding your case with the expectation that that communication will remain private.

3. The right to terminate / change attorneys. This is one of the most important rights that you have as a client and the one that so many people are not aware of having. You are entitled to terminate your relationship with an attorney and represent yourself (in pro per) or hire alternate counsel at any time you want. Should you terminate your relationship with an attorney, he / she must forward your entire file to your or your new attorney promptly. Similarly, your attorney can stop representing you at any time before litigation ensued by notifying you in writing, or for “good cause” if the lawsuit was filed and your rights will be prejudiced if your attorney abandons your case without allowing for sufficient time for you to obtain new counsel.

4. The right to a detailed billing statement for legal services from your attorney. As a client, you are entitled to receiving a detailed bill with the full breakdown of the costs and fees that attorney is charging you. The bill should include the time spent by your attorney on each task performed and what that task involved. In other words, you are definitely entitled to a greater detail than “3 hours - legal services” breakdown. A an example of a proper billing language that will make you feel more comfortable and will make your attorney less likely to be incorrect in his calculation of his fees is something like this: “12 minutes - a conversation with opposing counsel regarding responses to discovery. Agreed to an extension of 2 weeks to respond to interrogatories.”

5. The right to make ultimate decisions in a case. It is important that your remember that your attorney’s job is not to make decisions in your case but advise you on what course of action to take considering all the facts and circumstances of your case / situation. An attorney cannot and must not decide how much money he should settle your case for, whether he should dismiss the case, agree or disagree to go to trial and alike. An attorney must advise you of the relevant options you have at any given stage in the case, inform you of advantage and risks associated with any step you might be taking, recommend you the best course of action in your attorney’s professional opinion and then expect your final say as to what will be done in your case.

* Finally, before you decide to hire an attorney, do not forget to check that he is who he actually says he is. Many “fake” attorneys, suspended attorneys, and paralegals have been caught and prosecuted for unauthorized practice of law during the past few years. Make sure you are dealing with an actual attorney who is licensed to practice law in California. This is easy - just go to http://members.calbar.ca.gov/search/member.aspx , plug the name of your attorney and you will be able to see his contact information, brief biography, bar membership status and history of misconduct, if any.

The employee / independent contractor distinction at workplace is very important. Whether you are classified as employee or an independent contractor is very important to determine - it will affect your eligibility for benefits, the calculation of your taxes, your rights upon termination and your ability to recover from your employer / principal for injuries sustained at work and for their unlawful conduct.

Interestingly enough, employee/contractor distinction is also one of the most commonly misunderstood legal concepts in a workforce. Specifically, the majority of workers believe that just because they sign a contract that verbally states that they are independent contractors, it means that they indeed are and that they have no rights that the employees of the company enjoy.

Courts have been continuously rejecting this “literal” approach for many years. While a written agreement between the hiring body and the workers is one factor in determining the worker’s status, it’s is in no way dispositive in that determination.

Although no absolutely clear test has been established for determining whether a worker is a contractor or an employee, the key factor seems to pervade the vast majority of the California courts’ holdings on this issue: whether a worker is an employee or an independent contractor depends on the degree of control that his/her superior / manager exercises over his/her work. The examples of such control include the following: setting specific work hours and creating a designated work area for a workers, close review and supervision of his work. If an employer exercises actual control over the work, or if the parties understood that the employer could exercise control, the worker is more likely an employee and not an independent contractor.

Further, there has been a clear legislative trend over the past decades to provide employees greater protection from being abusively classified as an independent contractor. Recent court decisions look beyond an employer’s supervisory control to consider the economic context of the working relationship and the purpose of the relevant legislative scheme.

Thus, when the degree of control over the work of a particular person is unclear, consideration of other factors is permitted, such as the parties’ comparative investment in tools and equipment and the worker’s opportunity for profit or loss. Arkady Itkin, Esq.

There are thousands of lawyers in California who seem to have similar education, licensing and specialization and yet the experience that clients have with their attorneys is so different from one another.

So, how do you know that your attorney is the one who will provide you with quality legal representation? Below are a few key signs that you can rely on your attorney's opinion and have trust in his representation:

1. Your attorney is not overconfident in the outcome of your case. No matter how experienced and seasoned the lawyer is, he cannot and should never be sure of the outcome of your case. There are so many facts and circumstances that might come into play, as the case develops,  and the nature of our legal system is such that there is simply no way to know for sure whether you will win or lose, and if you win - how much exactly you will recover from the other side.

A responsible legal professional will assure you that he will do the best he can to represent your interests in the case, but he will not make any promises as to how much you will recover and how long exactly the process will take.

2. A good attorney should not act like a pushy salesman. He shouldn’t shove papers underneath your hand for your signature telling you that “it’s ok and you have nothing to worry about.” Instead, he should explain to you in plain and understandable English what you are signing, why it is necessary for you to sign the dcouemnt, and what the consequences of your executing that document are. For instance, a good attorney will go over your services contract with him paragraph by paragraph, making sure that you understand what the scope and the limitations of the legal services you will be provided with.

A good attorney will also advise you that you are free to terminate your agreement at any time and seek alternate counsel and hire a different attorney of your choice at any time.

A good attorney is patient with his clients and makes sure that you have a general understanding of the process, and he doesn’t make you feel unwelcome or like you are wasting his time.

3. A good lawyer is capable of keeping in touch with you in a way that makes you feel that your case gets the attention it requires. An attorney has a duty to communicate with his client on a consistent basis. One of the most common complaints reported to the California State Bar by clients is that attorney fail to communicate and return phone calls / e-mails and letters from their clients. Being ignored is a frustrating experience in any setting - professionally, socially and especially when it comes to dealing with a lawyer. Litigation process is stressful enough and raises many questions or concerns in a client as the case develops that need to be addressed promptly. This goes, of course, both ways - a good client is respectful of his attorney's time and other commitments, and realizes that it may take his lawyer longer to get back to him. A good client is patient. His life doesn't revolve around his case. As such, he doesn't check on the status of his case every few days and he understands that legal proceedings take time - months and sometimes years.

4. A good attorney will advise you not only how to prosecute your case but whether or not it is worth your time, money, energy and emotions to actually go after it. Not every fight is worth fighting and sometimes it is a better idea to walk away for your own benefit even if the other side gets away and isn’t held liable. An honest attorney will not make you fight a case just to charge you an hourly fee. He truly does work in the best interests of his clients by not only pursuing their legal rights but also advising them whether or not it’s prudent to pursue a case altogether.

5. A good lawyer is not too busy to handle your case. A competent lawyer will not take on more work than he can handle in a quality manner. A good attorney will not sacrifice the quality of his services for the sheer volume of the business because he realizes that his reputation and concern for his existing clients’ cases is his priority.

6. Lastly, your attorney doesn’t come across as a “typical” lawyer. A great attorney defies the stereotypes that are commonly associated with the legal profession - arrogance, greed and flamboyance, and substance abuse. He is friendly, personable and charismatic and you actually enjoy working with him / her.

The members of legal profession have been suffering from the reputation of being arrogant, greedy, and materialistic for many generations. This long-standing stereotype is not without basis.  I keep hearing from different people and my new clients about their negative experiences interacting with attorneys. “Arrogant, pompous, condescending, flamboyant” are the common terms that they describe the lawyers they know or had to work with.

I am not sure if it’s greed, insecurity or the desire for that missing validation from the outside that are behind that behavior. The astounding fact, however, is that so many of those attorneys believe that showing their “status” is beneficial to their work and their career. Nothing could be further from truth! Litigation process is intimidating enough. The last thing that a client needs is dealing with someone who makes it even more unpleasant and stressful. A lawyer is a fiduciary of his client. This is a very special relationship, during which a client has to disclose a lot of personal, confidential information about himself and his business. This is exactly why it is so crucial that an attorney treats his clients in as personable manner as possible without putting up walls.  One of the very important roles of an attorney is making his client feel comfortable, open, and honest about his problems and goals. When a client feels comfortable relating and disclosing every little facts and circumstance of his case, it will be of tremendous benefit and value to his legal representation. When your attorney knows the facts of your case in just as great of a detail as you do, he will be able to represent you in the most effective and zealous way.  This cannot be possibly achieved if the client is intimidated by his attorney, or feels rushed or unwelcome when talking to his lawyer.

One of my recent clients left her previous attorney for this exact reason. Every time she talked to him, on those rare occasions when she managed to actually get a hold of him, she experienced anxiety and feelings of inferiority as if her attorney was smarter than she was. When I called him to discuss the case, I knew immediately what my new client was talking about. Even I felt “pushed” when talking to him. The only difference is that I, of course, know how to handle the “type” and put him/her back in their place.

So, if you are intimidated by your attorney and you don’t feel comfortable sharing with him some of the personal information about you which could be relevant to your case, you are not the right fit for each other, and you are better off exercising your absolute right to be represented by a different lawyer. Arkady Itkin, Esq.   

If you are like the vast majority of workers in the United States and in California, you are an employee “at will.” This simply means that your employer may terminate your employment for any reason or no reason, as long as it’s not an illegal reason. Again, an employer can be completely arbitrary in choosing who to fire, and he can simply pull one name out of the list, and decide to terminate his/her employment. 

Termination may be wrongful, however, if it can be shown that the reason why any given worker was terminated was unlawful/illegal. Termination is unlawful if a member of a protected class was terminated from his job position because of being a member of that protected class. Sex, race, disability, gender, sexual orientation and religion are the most common discrimination claims in California among workers, students, and other aggrieved individuals.  

Employment Discrimination may be proven directly or circumstantially. Direct proof of unlawful discrimination requires a testimony of a witness (any third person) as to hearing or otherwise witnessing discriminatory conduct. For example, a co-worker might overhear his boss using the “n” word in the presence of, or towards, an African American worker, who later files discrimination complaint.  Circumstantial proof is a little more tricky. It requires investigation of all facts and circumstances of the environment where a person works to determine whether the employment practices in place are such that they inevitably cause disparate treatment of a protected class of employees. Thus, if an employer imposes a requirement that every new secretary should be able to bench press 150 lbs without any rational reason to have such a requirement considering the nature of the job, this is likely to be a significant evidence of employer’s attempt to prevent women  from applying or getting the position of a secretary on site. 

Discrimination claims are generally hard to prove because they usually come down to proving intent to discriminate (except in disability discrimination and failure to accommodate claims, where the intent to discriminate on the part of the employer is for the most part irrelevant). Often, there are no witnesses to discriminatory conduct, or some witnesses are unwilling to testify against their own employer.

In other cases, finding out whether an employer didn’t treat his employee well or even terminated other employees for similar discriminatory reasons is well worth the effort. With careful investigation of facts, interviewing all the available witnesses who are willing to cooperate and looking at the history of the company’s work and internal procedures, unlawful employment practices such as discrimination may surface and be proven at or before trial. Arkady Itkin, Esq.