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Customers Can Sue For Sexual Harassment: The Story of Mark & Susan

A new case (Hughs v. Pair, 07 CDOS 10973, 9/10/07) helps define the parameters of a little known section of the Unruh Civil Rights Act (Civil Code Section 51.9) that makes business, service or professional providers liable in damages if they sexually harass their clients or customers. It also extends potential liability to administrators, executors or trustees of estates.

Susan and Mark were married and had a son, Alex. The marriage ended in a contentious divorce. Mark died leaving his minor son, Alex, the only beneficiary of Mark’s $400 million estate. Susan had a contentious relationship with Pair, one of three trustees, having sued the estate seven times in four years.

Susan requested reimbursement from the trust for a two-month rental of a Malibu beach home for Alex, age 14, (yeah, right) at the cost of $80,000 a month. The trustees approved only one month expressing the opinion, among others, that the rental was for Susan’s, not Alex’s, benefit.

After three years of not speaking to her, Pair called Susan to invite her and her son to a King Tut exhibit. During that conversation he remarked how much he loved Alex and “you in a special way,” and that he could be persuaded to give her more time “if you would be nice to me.” When Susan responded that this was crazy talk, Pair said, “how crazy do you want to get?” Susan did not accept Pair’s invitation.

Susan and Alex ran into Pair and his son at the exhibit. Within earshot of both boys Pair said, “I’m going to get you on your knees and [expletive deleted] you one way or another.” Susan testified at her deposition that Pair’s statements caused her to suffer from discomfort, worry, anxiety, upset stomach, concern, and agitation in the form of her heart racing. But she also suffered these symptoms to a lesser degree because of the other litigation involving the trust.

Pair filed motion for summary judgment to dismiss the case on several grounds, the first one being of interest here: i.e., that since Susan was not a beneficiary of the trust there was no relationship between her and Pair that would bring section 51.9 into play. What does 51.9 cover? Let’s see.

First, there must be a business, service or professional relationship between the plaintiff and the defendant. Second, the defendant makes sexual advances, solicitations, sexual requests, or demands for sexual compliance to the plaintiff or the defendant engaged in verbal, visual, or physical conduct of a sexual nature or a hostile nature based on gender. Third, the conduct of the defendant was unwelcome and pervasive or severe. Fourth, the plaintiff was unable to easily end the relationship with the defendant. Fifth, the plaintiff suffered or will suffer economic loss or disadvantage or personal injury or the violation of of a statutory or constitutional right as a result of the defendant’s conduct.

Was there a “”business, service or professional relationship ” between Susan and Pair within the meaning of the Act? The Act itself contains a list that is expressly made non-exclusive. In other words, the list is for the purpose of illustration only and there could be other relationships not listed that are governed by the Act. The express list includes:

Physicians, psychotherapist, dentist, attorney, holder of a master’s degree in social work, real estate agent, real estate appraiser, accountant, banker, trust officer, financial planner, loan officer, collection service, building contractor, escrow loan officer, executor, trustee or administrator, landlord or property manager, teacher or any relationship that is substantially similar any of the above.

Was Susan’s relationship with Pair substantially similar to any of the above relationships? She was not beneficiary of the trust and by its terms could never expect any financial gain from the trust. However, the court held that her relationship with Pair fell within the intended reach of section 51.9.

“Susan is Alex’s mother and guardian, and in those capacities, she must deal with the trust on Alex’s behalf, even if she is not a beneficiary. The language of section 51.9 does not limit its scope to a relationship between a trustee and beneficiary. Instead, the statute is more expansive, applying to a relationship between ‘a plaintiff and a person including . . . a trustee.’ (section 51.9, subd. (a)(1)(C).) The law also applies to any relationship that is ‘substantially similar to those listed above.’ (section 51.9, subd. (a)(1)(F).) Susan, acting on Alex’s behalf, does not have the ability to ‘easily terminate the relationship’ with Pair as trustee. (citations omitted.) Susan has a sufficient ‘business, service or professional relationship’ with Pair as a trustee to qualify her for protection from sexual harassment under section 51.9.”

The case was ultimately dismissed on other grounds.

The court held that Section 51.9 sexual harassment will be analyzed the same way courts analyze sexual harassment in the employment context under the California Fair Employment and Housing Act and Title VII of the Civil Rights Acts. The court then found that the isolated incidents described by Susan, while course and vulgar, were not sufficiently pervasive or sever to cause Susan to suffer economic loss or personal injury within the meaning of those laws. Since the relationship did not change and had always been contentious, Susan failed to establish that she had been the victim of quid pro quo sexual harassment (where some benefit is conditioned upon the granting of sexual favors.)

Had the case gone forward Pair would have faced the possibility of a judgment for actual damages including emotional distress, punitive damages an attorneys fees.

We are all familiar with the laws prohibiting sexual harassment in the work place. Hughs confirms that those laws are operative in the business relationships not involving employment. Take heed, be prepared, be informed.

The Law Office of Phillip J. Griego
95 South Market Street, Suite 520
San Jose, CA 95113
Tel. 408-293-6341
Original article by Phillip J. Griego of The Law Office of Phillip J. Griego.

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