Nevellier v. Putnam (Cal. Ct. App. - Feb. 2, 2026)

Hat tip: If you're representing someone on appeal, know the appellate rules. Otherwise this might happen.

Justice Chou explains the situation fairly clearly at the outset of his opinion:

"Our local rules require that all parties promptly notify us about a bankruptcy that could affect our ability to decide an appeal. Despite this requirement, the parties in this case waited over four months after the filing of a bankruptcy petition by plaintiff Navellier and Associates, Inc. (NAI) and just two days before oral argument to tell us about that petition. Exacerbating the potential consequences of this delay, plaintiffs Louis Navellier and NAI now contend that the automatic bankruptcy stay precludes us from deciding this appeal. (11 U.S.C. § 362(a)(1).) If plaintiffs are correct, then the parties’ failure to provide timely notice of the bankruptcy would have caused this court to squander its valuable time and resources. Fortunately, plaintiffs are not correct because Navellier did not file for bankruptcy and because NAI, the debtor, brought this action. Although the harm to this court caused by the parties’ violation of our local rules is therefore minimized, this does not excuse their misconduct. Although we do not sanction the parties, we do admonish them and advise them to learn and follow our local rules in the future."

Not exactly something you want said about you in a published opinion, eh?

Want more details? Could you see it potentially happening to you? Here's a more robust explication of what went down, alongside the relevant rules -- with the italicized portions (all of 'em!) in the original:

"Under rule 21 of our local rules, “[a]ny party to a matter pending before this court who is aware of a bankruptcy that could cause or impose a stay of proceedings in this court must promptly give notice of such bankruptcy.” (Ct. App., First Dist., Local Rules of Ct., rule 21(a), italics added.) That notice “shall include (1) a copy of the most recent order of the bankruptcy court and of any stay order issued by that court and (2) an explanation of whether a stay order or an automatic stay is in effect and why the stay applies to the pending appeal or writ proceeding.” (Rule 21(b), italics added.) Despite these requirements, no party in this case complied with rule 21. Fortunately, however, the automatic bankruptcy stay (11 U.S.C. § 362(a)(1)) does not preclude us from disposing of this appeal; thereby, mitigating much of the harm that could have resulted from the parties’ dereliction of their professional duties.

NAI filed its bankruptcy petition on September 5, 2025. Plaintiffs’ counsel admitted at oral argument that he knew about the petition soon after NAI filed it and well before he filed the reply brief on October 27, 2025. Despite this, he waited until January 20, 2026, two days before oral argument, to notify us about NAI’s bankruptcy. And when he did so, he did not comply with rule 21(b). Instead, he only provided us with the information required by that rule after we ordered him to do so. At oral argument, Plaintiffs’ counsel pled ignorance of rule 21 and his initial belief, based on the purportedly faulty advice of bankruptcy counsel, that NAI’s bankruptcy did not stay this appeal. But neither excuse absolves him.

First, “[a]s an officer of the court,” he “bore professional responsibility to be aware of and knowledgeable about local court rules.” (Massie v. AAR Western Skyways, Inc. (1992) 4 Cal.App.4th 405, 408.) 

Second, rule 21(a) required the parties to provide notice of any bankruptcy that “could cause or impose a stay of” this appeal. (Italics added.) Thus, the parties had to provide this court with notice of NAI’s bankruptcy if there was any possibility, however remote, that it stayed this appeal. (See Dictionary.com (2026) [as of February 2, 2026] [“could” is “used to express possibility”].) As evidenced by plaintiffs’ claim at oral argument that NAI’s bankruptcy did stay this appeal due to defendants’ claim for prevailing party attorney fees, that possibility undoubtedly existed here. . . .

Defendants’ counsel also acquitted themselves poorly. After some prodding at oral argument, Grail’s counsel eventually admitted that he learned about NAI’s bankruptcy a couple of months before oral argument. In an apparent attempt to justify his failure to comply with rule 21, he also proffered one of the inadequate excuses proffered by plaintiffs’ counsel: that he believed, after consulting with a bankruptcy attorney, that the automatic bankruptcy stay did not affect this appeal."

Yikes.

That said, Justice Chou's opinion also makes clear what one should do when one has made a mistake like this:

Fess up. Which the lawyers did here, and which is the only thing that saved them from sanction (or even stronger vitriol):

"To their credit, all counsel did, for the most part, accept responsibility for the parties’ failure to comply with rule 21. For this reason, we decline to impose any sanctions at this time. (But see Keitel v. Heubel (2002) 103 Cal.App.4th 324, 340 (Keitel) [imposing sanctions due in part to the parties’ failure to notify the court about a bankruptcy in violation of a local rule].) Instead, we admonish counsel to comply with our local rules in the future and to “promptly” notify us if a bankruptcy petition has been filed by one of the parties so we do not waste our limited time and resources. (Rule 21(a).) Indeed, even though we, as explained below, may resolve this appeal notwithstanding NAI’s bankruptcy, the parties’ failure to promptly notify us about that bankruptcy still forced us to issue orders that should not have been necessary and to waste time and resources discussing their failure to comply with rule 21 at oral argument and in this opinion."

If didn't know it already: The Court of Appeal does not like surprises right before oral argument, nor is it at all interested in having its time wasted writing a draft opinion that's potentially mooted by events that everyone other than the justices knew about long ago.