Irvine Heiress Ordered to Pay Hurt Employee; Her Attorneys Scolded

A state appeals court has ordered Irvine heiress Joan Irvine Smith to pay $464,000 to an employee who was trampled by Smith’s horse.

But the court reserved its most powerful blows for Smith’s attorneys, calling them “welshing lawyers” for attempting to renege on an agreement to settle the matter out of court.

The three-judge panel fined Smith’s two attorneys $12,500 for filing a “frivolous appeal” in the case and also took the unusual step of reporting them to the State Bar of California for possible disciplinary action.

Justice Thomas Crosby, who wrote the unusually harsh opinion, said Smith’s attorneys agreed to have an outside arbitrator resolve the case but sought to back out of the agreement because they were unhappy with the final award.

“Such tactics are unworthy of the humblest trade or profession,” Crosby said. “Lawyers in an adversarial system are free to inflict hard blows on their opponents . . . but not low ones.”

“We do not see how the practice of law can endure as a profession if attorneys will misrepresent their authority to act on their clients’ behalf and then attempt to renege on their own signed [agreements].”

Crosby said the panel sanctioned Smith’s attorneys, Jeffrey H. Baraban and James S. Link, both of Pasadena, after considering “such factors as the need to deter like conduct in the future and the government expense in processing, reviewing and deciding a frivolous appeal.”

The opinion was certified for publication, meaning that it can be cited as precedent in similar cases.

Both Baraban and Link said they were distressed by the judges’ ruling and the tone of their opinion. They said Tuesday that they will ask the appeals court to reconsider its decision. If that fails, the attorneys may appeal to the state Supreme Court.

“This wasn’t a frivolous appeal,” Baraban said. “We thought long and hard about it.”

Crosby’s remarks “are pejorative in nature and clearly intended to impugn [our] good reputation,” Baraban said.

The case involved a suit filed by Julia A. Caro, a personal assistant for Smith who is a descendant of one of Orange County’s richest and most powerful families.

Caro, a 29-year-old Irvine woman, occasionally exercised Smith’s horses at The Oaks, the heiress’ 26-acre horse stables in San Juan Capistrano. One day, in 1990, Caro was asked to hold Smith’s horse, Panache, while the animal was receiving acupuncture treatment.

As the acupuncturist used the needles to transmit low doses of electricity into the horse, Panache “did a couple ‘High ho silvers’ before stomping on Caro and bolting,” according to James R. Traut, an attorney for the woman.

Traut said Caro suffered a fractured leg and $25,000 in medical bills. She sued after Smith, who had no workers’ compensation insurance coverage, refused to pay for her treatment, Traut said.

Smith referred the suit to her insurance company, who retained Baraban to defend her.

Baraban signed an agreement to have a Santa Ana attorney act as an arbitrator. At a later arbitration hearing, both Baraban and Smith responded “yes” when the arbitrator asked them if they understood that the parties could not appeal his award under terms of the binding arbitration.

But when the arbitrator awarded Caro $311,111 plus interest and another $59,500 for attorney’s fees, Baraban objected, saying attorney’s fees were not covered by the arbitration agreement.

Baraban later claimed that he was not authorized by Smith to agree to a binding arbitration.

Traut, Caro’s attorney, said that with interest, the judgment against Smith has swollen to $641,722.

He said Crosby’s opinion “sends a clear message to attorneys that if they go out on a limb with a meritless appeal, they do it at the risk of placing their reputation and financial resources on the line.”