Gantman v. Stephan, Schreiber & Tabachnick CPA's CA2/7

Filed 1/19/22 Gantman v. Stephan, Schreiber & Tabachnick CPA’s CA2/7
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

ANDREW GANTMAN, B290271

Plaintiff and Appellant, (Los Angeles County
Super. Ct. No. BS168144)
v.

STEPHAN, SCHREIBER &
TABACHNICK CPA’S, INC.,

Defendant and Respondent.

APPEAL from a judgment of the Superior Court of
Los Angeles County, Edward B. Moreton, Jr., Judge. Affirmed.
Andrew Gantman, in pro. per., for Plaintiff and Appellant.
DeSimone & Huxster and Gerry DeSimone for Defendant
and Respondent.
_________________
 Andrew Gantman, representing himself, appeals the
judgment entered in favor of his former employer, Stephan,
Schreiber & Tabachnick CPA’s, Inc. (SST), contending the trial
court’s findings that SST did not owe him unpaid wages or violate
any related provisions of the Labor Code are not supported by
substantial evidence. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
1. Gantman and SST’s Business Relationship
Gantman, a certified public accountant with a solo tax
practice, and Peter Stephan, one of the principals of SST, agreed
in late 2014 it could be mutually beneficial to combine their
operations. As an initial step toward Gantman acquiring an
ownership interest in SST, Gantman moved into SST’s offices,
where, starting January 1, 2015, he provided tax advice to his
preexisting clients and performed work for SST clients. Gantman
informed his preexisting clients he was merging his practice into
SST’s. The arrangement continued until late March 2015.
Gantman and SST disputed the nature and extent of their
agreement to compensate Gantman for work performed while the
parties were contemplating Gantman’s purchase of a share in
SST. For Gantman’s preexisting clients it was agreed Gantman
would continue to perform services at previously negotiated rates
(typically between $425 and $500 per hour); SST would send
invoices to those clients on SST letterhead; and SST would pay
Gantman the full amounts billed after the receivables had been
collected. Stephan raised the issue of a contribution by Gantman
to the firm’s overhead in connection with his work for those
clients; no express agreement was reached.
For Gantman’s work for SST clients Stephan proposed
Gantman be paid $100 per hour with an additional $100 per hour

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to be credited against a later purchase by Gantman of Stephan’s
SST stock. Gantman rejected the proposal since the credit would
be worthless if no stock purchase agreement was reached and
said he would not work for less than $200 per hour. According to
Gantman, he explained SST could bill its clients for his services
at $500 per hour, thereby generating not only reimbursement for
overhead attributable to Gantman’s work but also a significant
profit. Gantman agreed he would bear any collection risk by
deferring payment of his share of revenue until SST actually
received payment for sums billed. Stephan never expressed his
agreement with Gantman’s counteroffer and complained a
number of times about Gantman’s demand to be paid $200 per
hour, stating he did not need to pay someone that much to do the
work Gantman was doing. Nonetheless, SST paid the sums
requested by Gantman until March 2017.
On March 24, 2017 Gantman requested payment of the
outstanding sums he believed were owed to him. The next
morning Stephan told Gantman their arrangement was not
working out and terminated the relationship. In the final
payment issued to Gantman, SST deducted from the total
payment sought by Gantman amounts for overhead (rent and
parking) and other employer-related expenses (payroll taxes).1
Gantman objected to the deductions, but Stephan refused to issue
a new check.

1 The deductions totaled $6,811.

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 2. The Labor Commission Proceeding
Unable to resolve his dispute with SST over what he
asserted were unpaid wages and unreimbursed expenses,2 in
April 2015 Gantman, represented by counsel, filed a wage claim
with the Labor Commissioner. SST argued Gantman was a
partner of the firm, not an employee (relying in part on
Gantman’s self-description as a partner), and, in any event,
because there had been no agreement as to his hourly rate, he
was owed nothing more than he had previously been paid.
Following a hearing in February 2016 (commonly referred to as a
“Berman hearing”), the hearing officer found Gantman was an
employee, but awarded nothing because (among other reasons)
evidence of reimbursable expenses had not been submitted and
there was no independent evidence of an agreement to pay
Gantman $200 per hour for his SST client work.
Pursuant to Labor Code section 98.2, subdivision (a),
Gantman appealed the adverse award to the superior court,
“where the appeal shall be heard de novo.” (See Post v.
Palo/Haklar & Associates (2000) 23 Cal.4th 942, 947-948
[“Although denoted an ‘appeal,’ unlike a conventional appeal in a
civil action, hearing under the Labor Code is de novo. [Citation.]
‘“A hearing de novo [under Labor Code section 98.2] literally
means a new hearing,” that is, a new trial.’ [Citation.] The
decision of the commissioner is ‘entitled to no weight whatsoever,
and the proceedings are truly “a trial anew in the fullest
sense”’”].)

2 Neither the record on appeal nor the parties’ briefing
indicates the total amount demanded by Gantman.

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 3. Trial De Novo in Superior Court
Gantman’s claim for unpaid wages was tried before the
court on December 13 and 14, 2017. Both sides were represented
by counsel during trial. Gantman, Stephan and three largely
peripheral witnesses testified, and 50 documents from the joint
exhibit list were admitted into evidence. The parties then
submitted posttrial briefs.
After taking the matter under submission, the court on
March 21, 2018 issued its ruling in favor of SST. The court found
Gantman was an employee of SST; the parties agreed Gantman
would be paid for work he performed on behalf of SST’s clients,
but there was no agreement on the amount Gantman would be
paid for that work; there also was no agreement as to what, if
anything, Gantman would be paid for activities other than
performing accounting work for clients; and there was
insufficient proof that any particular activities other than
performing accounting work for clients constituted part of
Gantman’s employment by SST. (The court explained those other
activities may have been undertaken in anticipation of
Gantman’s potential acquisition of an interest in SST or for
Gantman’s own personal professional development.)
With respect to Gantman’s compensation the court found
the hourly rate by which Gantman’s pay would be calculated
“was an ongoing subject of discussion (written and oral)” between
Gantman and Stephan. Although Gantman sought to be paid
$200 per hour, “defendant . . . never entered into such an
agreement.” Accordingly, the court concluded, Gantman was
entitled to be paid only at the applicable minimum wage at the
time ($9 per hour): “Since there was no agreed-upon rate of pay,
the $9 minimum wage applied.” Putting aside whether SST’s

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clients paid for all time billed by Gantman, Gantman claimed to
have performed 639.2 hours of work attributable to SST’s clients.
According to the evidence at trial, Gantman was paid $25,753.25
for his work for SST’s clients, a sum that exceeded by a
significant amount the minimum wage for the claimed hours.
Thus, “[Gantman] has not proven tha[t] he was paid less than the
amount to which he was entitled and he is to take nothing in this
lawsuit.”
Although no judgment was entered following the court’s
March 21, 2018 ruling, Gantman, now representing himself, filed
a notice of appeal on May 21, 2018. At the direction of this court,
the parties obtained a judgment on December 2, 2021. The notice
of appeal is deemed filed immediately after entry of judgment.
(Cal. Rules of Court, rule 8.104(d)(1).)3

3 No court reporter was present during trial. Gantman, who
began representing himself after the court’s March 2018 ruling,
elected to proceed by way of appendix and settled statement.
After multiple rounds of proposed settled statement, responses
and objections, court order, amendments and additional
objections, the court certified the proposed statement on appeal
filed by Gantman on April 4, 2019 after counsel for SST indicated
it had no further objections. The final version of the statement
prepared by Gantman, like the original iteration he had
submitted six months earlier, included an extensive summary of
his own trial testimony but improperly omitted any summary of
the testimony of Stephan. (Cf. Cal. Rules of Court,
rule 8.137(d)(2)(A) [“[t]he condensed narrative must include a
concise factual summary of the evidence and the testimony of
each witness relevant to the points that the appellant states
under (1) are being raised on appeal”].)

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 DISCUSSION
1. Standard of Review
We generally apply the familiar substantial evidence test
when the sufficiency of the evidence is at issue on appeal. Under
this deferential standard of review, “‘[A]ll factual matters will be
viewed most favorably to the prevailing party [citations] and in
support of the judgment. . . . “In brief, the appellate court
ordinarily looks only at the evidence supporting the successful
party, and disregards the contrary showing.” [Citation.] All
conflicts, therefore, must be resolved in favor of the respondent.’”
(Italics omitted.) (Campbell v. Southern Pacific Co. (1978)
22 Cal.3d 51, 60; accord, Western States Petroleum Assn. v.
Superior Court (1995) 9 Cal.4th 559, 571; see Nissan Motor
Acceptance Cases (2021) 63 Cal.App.5th 793, 818 [“We must not
review the evidence to determine whether substantial evidence
supports the losing party’s version of the evidence. Instead, we
must determine if there is any substantial evidence, contradicted
or uncontradicted, to support the trial court’s findings”].)
However, when, as here, the trier of fact has concluded the
party with the burden of proof did not carry the burden and that
party appeals, “‘[I]t is misleading to characterize the failure-of-
proof issue as whether substantial evidence supports the
judgment. . . . [¶] Thus, where the issue on appeal turns on a
failure of proof at trial, the question for a reviewing court
becomes whether the evidence compels a finding in favor of the
appellant as a matter of law. [Citations.] Specifically, the
question becomes whether the appellant’s evidence was
(1) “uncontradicted and unimpeached” and (2) “of such a
character and weight as to leave no room for a judicial
determination that it was insufficient to support a finding.”’”

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(Dreyer’s Grand Ice Cream, Inc. v. County of Kern (2013)
218 Cal.App.4th 828, 838; accord, Phipps v. Copeland Corp. LLC
(2021) 64 Cal.App.5th 319, 333; Juen v. Alain Pinel Realtors, Inc.
(2019) 32 Cal.App.5th 972, 978-979; Patricia A. Murray Dental
Corp. v. Dentsply Internat., Inc. (2018) 19 Cal.App.5th 258, 270;
see In re R.V. (2015) 61 Cal.4th 181, 201 [where party fails to
meet its burden on an issue in the trial court, “the inquiry on
appeal is whether the weight and character of the evidence . . .
was such that the [trial] court could not reasonably reject it”].)
2. The Evidence Did Not Compel a Finding That SST
Agreed To Pay Gantman $200 per Hour
To prevail on his cause of action for unpaid wages (that is,
for breach of contract), Gantman was required to demonstrate
SST agreed to pay him $200 per hour for his work on behalf of
SST’s clients. (See Oasis West Realty, LLC v. Goldman (2011)
51 Cal.4th 811, 821 [the elements for breach of contract are
(1) the existence of the contract; (2) plaintiff’s performance or
excuse for nonperformance; (3) defendant’s breach; and
(4) resulting damage]; Stockton Mortgage, Inc. v. Tope (2014)
233 Cal.App.4th 437, 453; Rutherford Holdings, LLC v. Plaza
Del Rey (2014) 223 Cal.App.4th 221, 228.) Gantman
acknowledges there was no written contract governing his
compensation and does not challenge on appeal the trial court’s
finding there was no oral agreement. Rather, he contends, citing
Civil Code section 1584 (section 1584), his offer to provide tax and
related advice to SST’s clients and demand to be paid $200 per
hour followed by SST’s payment for his services at that rate
(until the final payment made contemporaneously with the
termination of his employment) constituted a sufficient offer and

8
acceptance to create a binding agreement. Gantman’s argument
is legally and factually flawed.
Section 1584, which states, “Performance of the conditions
of a proposal, or the acceptance of the consideration offered with
a proposal, is an acceptance of the proposal,” describes what is
traditionally referred to as a unilateral contract. (Asmus v.
Pacific Bell (2000) 23 Cal.4th 1, 10 & fn. 4; see Cal Fire
Local 2881 v. California Public Employees’ Retirement System
(2019) 6 Cal.5th 965, 988 [“[a] unilateral contract is one that is
accepted by performance”].) “In a unilateral contract, there is
only one promisor, who is under an enforceable legal duty.
[Citation.] The promise is given in consideration of the
promisee’s act or forbearance.” (Asmus, at p. 10.)
In a typical unilateral contract in the employment setting,
the employer promises a prospective employee certain
compensation for defined work. The prospective employee
accepts the offer (the proposal in the language of section 1584) by
performing the work, not by promising to do so. Once the work is
performed (or partially performed), the employer is obligated to
make the promised payment; it cannot revoke the offer. Thus, if
SST had proposed to Gantman that it would pay him $200 per
hour to provide tax accounting services to its clients and
Gantman had performed those services, a unilateral contract
would have been created, obligating SST to pay the offered
compensation. If the unilateral contract was of indefinite
duration, SST could terminate it only after a reasonable time and
after providing adequate notice. (See Asmus v. Pacific Bell,
supra, 23 Cal.4th at p. 18.)
Gantman describes a very different type of contract, one
that reverses not only the traditional employer/employee roles

9
but also the order of exchange of promise and performance.
According to Gantman, he was the promisor who said to SST, “I
will perform tax accounting services for your clients if you pay me
$200 per hour to do that work.” It was undisputed SST did not
accept that proposal by promising to make the specified payment,
which would have created a bilateral contract. Nor did SST
obligate Gantman to honor his promise by performing the
conditions of his proposal (paying Gantman in advance of his
doing the work), a unilateral contract. As a matter of general
contract law, Gantman performed work in the hope of receiving
compensation without any binding obligation on the part of SST
to pay him the $200 per hour he proposed. Under these
circumstances Gantman could at most recover the reasonable
value of the services he performed (which, of course, might equal
$200 per hour).4

4 In the absence of a contract covering compensation—either
unilateral or bilateral—SST would be obligated under a theory of
quasi-contract or quantum meruit (a common count) to pay
Gantman the reasonable value of the services provided. (See,
e.g., Newport Harbor Ventures, LLC v. Morris Cerullo World
Evangelism (2016) 6 Cal.App.5th 1207, 1222 [“‘[a] quantum
meruit or quasi-contractual recovery rests upon the equitable
theory that a contract to pay for services rendered is implied by
law for reasons of justice’”]; Chodos v. Borman (2014)
227 Cal.App.4th 76, 100 [“‘[t]he underlying idea behind quantum
meruit is the law’s distaste for unjust enrichment’”].) For reasons
not explained in the record, Gantman did not seek recovery under
a quasi-contract theory as an alternative to his claims for breach
of contract/unpaid wages. (Cf. Murphy v. Kenneth Cole
Productions, Inc. (2007) 40 Cal.4th 1094, 1116-1117 [the trial
court hears the appeal from the Berman hearing “‘as a court of
original jurisdiction, with full power to hear and determine it as

10
 Similarly, the evidence at trial (to the extent reflected in
the record on appeal), when considered as a whole, did not compel
a finding as a matter of law that, by paying Gantman for a
number of weeks at the requested rate of $200 per hour, SST
impliedly promised to continue to pay Gantman at that rate.
(See Civ. Code, § 1621 [“[a]n implied contract is one the existence
and terms of which are manifested by conduct”]; Retired
Employees Assn. of Orange County, Inc. v. County of Orange
(2011) 52 Cal.4th 1171, 1178 [same].) Stephan testified at trial
he had repeatedly and consistently told Gantman he was not
agreeing to pay him $200 per hour on an ongoing basis. That
testimony was supported by joint exhibit 36, Gantman’s proposed
agenda for a meeting with Stephan dated February 3, 2015 (that
is, more than a month after Gantman had moved into SST’s
offices and started working on SST client matters), which stated
as one of the initial matters to be resolved, “Come to terms with
underlying view re ‘I can get someone at ___/hour’ and ‘I don’t
need someone at ___/hour.’” The agenda also called for a
discussion of financial matters, specifically “Compensation” and
“Overhead,” indicating those matters remained unresolved.
It was the trial court’s role, not ours, to resolve any conflict
in the testimony between Gantman and Stephan regarding the
meaning of those agenda items (whether they related to

if it had never been before the labor commissioner’”; “a trial
court’s power to hear a wage dispute extends to the consideration
of related issues not reached by the Labor Commissioner”]; Klein
v. Chevron U.S.A., Inc. (2012) 202 Cal.App.4th 1342, 1388 [“if a
plaintiff was uncertain as to whether the parties had entered into
an enforceable agreement, the plaintiff would be entitled to plead
inconsistent claims predicated on both the existence and absence
of such an agreement”].)

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Gantman’s initial employment relationship with SST or only his
potential purchase of an ownership interest) and, more broadly,
concerning the existence and status of any interim agreement
about Gantman’s compensation. Even under the traditional
substantial evidence standard of review, we accept the trial
court’s interpretation of the evidence. (See Heard v. Lockheed
Missiles & Space Co. (1996) 44 Cal.App.4th 1735, 1747 [under the
substantial evidence standard of review, “[a]ll factual matters
must be viewed in favor of the prevailing party and in support of
the judgment. All conflicts in the evidence must be resolved in
favor of the judgment”]; see also Pear v. City and County of San
Francisco (2021) 67 Cal.App.5th 61, 76 [“we will not reverse a
finding supported by substantial evidence merely because other
evidence would have supported a different decision”].) As
discussed, our deference to the trial court’s resolution of factual
disputes is even greater when, as here, the appellant failed to
carry the burden of proof at trial and reversal is warranted only if
the uncontradicted evidence compels a finding in his or her favor
as a matter of law. (E.g., Phipps v. Copeland Corp. LLC, supra,
64 Cal.App.5th at p. 333.) In addition, because Gantman’s
settled statement omitted any summary of Stephan’s trial
testimony, we presume his testimony also supported the trial
court’s finding there was no agreement, express or implied, to pay
Gantman $200 per hour. (See Cal. Rules of Court,
rule 8.137(d)(2)(A) [“[a]ny evidence or portion of a proceeding not
included [in the proposed settled statement] will be presumed to
support the judgment or order appealed from”].)

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 3. Gantman’s Claims of Labor Code Violations Fail in the
Absence of an Agreement To Pay Him $200 per Hour
Gantman contends, by withholdings $6,811 from his final
paycheck—sums representing SST’s overhead and other
employer expenses—SST violated Labor Code sections 201,
subdivision (a), 221 and 2802, subdivision (a). Section 201,
subdivision (a), provides, “If an employer discharges an employee,
the wages earned and unpaid at the time of discharge are due
and payable immediately.” Section 221 provides, “It shall be
unlawful for any employer to collect or receive from an employee
any part of wages theretofore paid by said employer to said
employee.” Section 2802, subdivision (a), provides, “An employer
shall indemnify his or her employee for all necessary
expenditures or losses incurred by the employee in direct
consequence of the discharge of his or her duties . . . .”
The trial court, however, concluded, because Gantman was
entitled only to the minimum hourly wage, he had been
substantially overpaid, including in his final paycheck.
Accordingly, any deductions from the amount Gantman had
requested did not constitute unlawful withholding. Gantman
received full and immediate payment of all wages earned.
Gantman complains it is absurd to believe he would have
agreed to work for the minimum wage—a point well taken. But
he does not argue the trial court erred in ruling that, in the
absence of an agreement setting his compensation, he was legally
entitled only to payment at that rate.5 And although he cites case

5 The trial court did not cite any legal authority for its ruling
that, in the absence of an agreement as to his hourly
compensation, Gantman was entitled to be paid only at the

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law that requires an employer to include in a final check all
wages earned and unpaid at the time of termination and
prohibits withholding amounts to repay debts owed by the
employee, whether or not disputed, Gantman does not argue, and
the record would not support a claim, that the final payment he
received did not fully compensate him for all hours worked at the
governing minimum wage. Because SST’s final check actually
paid Gantman in excess of what he was due for the period
covered, the failure to pay him even more, whether or not
described as a deduction or withholding, was not unlawful.
Gantman also contends SST, by paying him as an
independent contractor, violated Labor Code section 226.8,
subdivision (a)(2), which prohibits deducting certain charges,
including space rental, from the compensation of an individual
who has been willfully misclassified as an independent
contractor.6 But once again, because Gantman was paid all that
he claimed he was entitled to prior to the final check and the
final check overcompensated Gantman for hours worked when
calculated at a $9 hourly rate, there could be no unlawful
deductions or withholdings.

current minimum wage. As discussed, Gantman does not dispute
that ruling on appeal, and SST does not address the point.
6 In fact, SST issued Gantman both a form W-2 for a portion
of his 2015 earnings ($28,220) and a form 1099 for additional
2015 earnings ($34,603). The numbers suggest the W-2 related
to Gantman’s work for SST clients; the 1099 reflected his
compensation for services provided to his preexisting clients.

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 4. Gantman’s Remaining Claims Lack Merit
Gantman argues the trial court demonstrated clear bias
and abused its discretion by ordering him to incorporate into his
proposed settled statement amendments and modifications
requested by SST, which Gantman contends were false or
misleading. However, all the purportedly improper additions
were subsequently removed from the iteration of the settled
statement certified by the trial court, as Gantman has
acknowledged. Accordingly, any interim postjudgment ruling by
the trial court concerning the settled statement could not possibly
constitute prejudicial error warranting reversal. (See Cassim v.
Allstate Ins. Co. (2004) 33 Cal.4th 780, 802 [for a trial court’s
order to be overturned, appellant must demonstrate an error was
prejudicial; that except for the error, a different outcome was
probable]; Brue v. Al Shabaab (2020) 54 Cal.App.5th 578, 588-
589 [“[a]bsent any showing of prejudice, we cannot reverse the
trial court’s order”]; D.Z. v. Los Angeles Unified School Dist.
(2019) 35 Cal.App.5th 210, 231 [“a ‘“miscarriage of justice”’
warranting reversal ‘“should be declared only when the court,
‘after an examination of the entire cause, including the evidence,’
is of the ‘opinion’ that it is reasonably probable that a result more
favorable to the appealing party would have been reached in the
absence of the error”’”].)
Finally, Gantman argues he was denied his statutory right
to a trial de novo because the trial court ignored the evidence he
presented, as well as pertinent legal authority, all of which
should have led to a judgment in his favor. Gantman’s sequel to
his failed substantial evidence argument fares no better than the
original version.

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 DISPOSITION
The judgment is affirmed. SST is to recover its costs on
appeal.

PERLUSS, P. J.
We concur:

SEGAL, J.

FEUER, J.

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