Tuesday, June 2, 2026
Page 3
Court of Appeal:
Judge’s Over-Delegation Means $43.5 Million Award Falls
Litigation Has Been Going on for More Than 19 Years; Justices Observe That There Is No End in Sight
By a MetNews Staff Writer
The Fifth District Court of Appeal, acting in a wage-and-hour case filed 19 years ago that resulted in a $43.5 million judgment in 2022 in favor of nearly 400 employees, has held that that the judge improperly delegated his judicial fact-finding role to a referee—pursuant to a non-consensual reference—requiring a reversal.
“Unfortunately, the end is still nowhere in sight,” Justice Rosendo Peña Jr. lamented in a 140-page slip opinion, filed Friday, that was certified for partial publication.
The action was brought in April 2007 by Carolyn Cortina against North American Title Company (“NAT”), now known as Lennar Title, Inc. As judicially narrowed, there emerged as plaintiffs a certified class of employees who had been denied overtime payments based on being classified, erroneously it was alleged, as “exempt” from the Labor Code requirement of such compensation.
In the first phase of the proceedings, Fresno Superior Court Judge Jeffrey Y. Hamilton Jr. resolved some of the liability issues, ruling against NAT. The second phase addressed the fashioning of remedies, but Hamilton, over the parties’ objections, enlisted the services of Patrick J. O’Hara, a retired judge of the Tulare Superior Court, to perform services as a referee.
Hamilton acted pursuant to Code of Civil Procedure §639(a)(3) which authorizes a nonconsensual reference “[w]hen a question of fact, other than upon the pleadings, arises upon motion or otherwise, in any stage of the action.”
Peña’s Opinion
In Friday’s opinion, Peña made note that in the California Supreme Court’s 2014 opinion in Duran v. U.S. Bank National Assn., “Justice Carol Corrigan used the phrase ‘exceedingly rare beast’ to describe ‘a wage and hour class action that proceeded through trial to verdict.’ ” That case went on for more than 16 years and 260 persons comprised the class.
“We dare say the present case is even rarer and more beastly than Duron.” he remarked, noting the amount of time that has elapsed since the complaint was filed, that there were initially about 700 plaintiffs, and that “[t]here have been numerous interlocutory appeals and writ proceedings, the most recent of which involved review by the California Supreme Court.”
(In the 2024 case of North American Title Co. v. Superior Court, the state’s high court held that NAT did not act with sufficient alacrity in seeking the disqualification of Hamilton for cause, noting that Code of Civil Procedure §70.3(b)(2) requires that the proponent of a recusal act at the “earliest practicable opportunity.”)
NAT noted in its opening brief on appeal that there was “100 days of testimony” before O’Hara.
Unprecedented in California
Peña declared:
“A nonconsensual reference of the scope and magnitude ordered in this case is not merely a rare occurrence. It appears unprecedented in our state jurisprudence. A trial court’s authority to delegate matters to a referee without the parties’ consent is strictly circumscribed by the California Constitution and Code of Civil Procedure. The reference proceedings below were entirely unauthorized. This error alone compels reversal of the judgment.”
He went on to elaborate:
“The trial court impermissibly delegated to the referee the duties of hearing the individual testimony of approximately 243 witnesses, assessing their credibility, weighing the evidence, and resolving conflicts in the evidence—including inconsistencies in the testimony of various witnesses as compared to their prior depositions and/or testimony in the first phase of trial. While the referee’s findings and recommendations were deemed ‘advisory,’ the court deferred to the referee’s credibility determinations and expressly invoked the principle that a referee’s recommendations are entitled to great weight.”
Weighing Credibility, Evidence
The justice said that while referees do judge the credibility of witnesses and evaluate evidence, “those functions are strictly limited under Code of Civil Procedure section 639, subdivision (a)(3) to questions of fact arising outside of the pleadings,” explaining:
“In other words, to ancillary factual questions not dispositive of the ultimate issues in the case. The trial court erroneously gave weight to, and adopted, the referee’s findings on ultimate issues of NATC’s legal and financial liability.”
The justice commented:
“The trial court’s reference order was both innovative and unprecedented, but neither made the reference proceedings lawful.”
In ordering the reference, Hamilton said that “Federal Rules of Civil Procedure, Rule 53, permits special masters to be appointed without the consent of the parties to resolve questions involving ‘difficult computation of damages.’ ” Peña pointed out:
“[R]ule 53 of the Federal Rules of Civil Procedure…was both irrelevant and misconstrued by the trial court….[R]eference proceedings are exclusively governed by the California Constitution and state statutory law. Moreover, rule 53 does not authorize the type of nonconsensual reference ordered in this case.”
The unpublished portion of the opinion deals with the plaintiffs’ cross-appeal. Penal noted that a “significant portion” of it “is mooted by reversal of the judgment against defendant” and dealt with issues that remained to be resolved on appeal.
The case is Cortina v. North American Title Company, 2026 S.O.S. 1604.
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