Justia California Court of Appeals Opinion Summaries

Articles Posted in Civil Procedure
by
Plaintiffs Linda and Dwayne Struiksma lost title to their home in a foreclosure sale. The purchaser at the sale then brought an unlawful detainer action against them under Code of Civil Procedure section 1161a(b)(3). A default judgment was issued, and plaintiffs were evicted from their property. Plaintiffs then filed this action against defendants HSBC Bank USA, N.A. and Ocwen Loan Servicing, LLC (collectively, defendants), their lender and loan servicer, who were not parties to the unlawful detainer action. Generally, they alleged defendants carelessly failed to credit several payments to their loan balance. Thus, plaintiffs contended they were never in default and defendants wrongfully foreclosed on the property. The trial court sustained defendants’ demurrer to the complaint, finding all of plaintiffs’ claims were precluded by the unlawful detainer judgment except for a claim under the Truth in Lending Act (TILA), which was defective for other reasons. Plaintiffs were denied leave to amend on all claims and appealed the resulting judgment. The Court of Appeal determined the trial court erred in ruling plaintiffs’ claims were precluded, and published this case to clarify the preclusive effect of an unlawful detainer action under section 1161a. Defendants also argued certain claims the trial court found precluded failed for reasons other than preclusion. Given its ruling, the court had no opportunity to consider these arguments. So, this case was remanded for the trial court to consider them in the first instance. As to the TILA claim, the Court held it suffered from several defects, and the trial court correctly sustained the demurrer to this claim without leave to amend. View "Struiksma v. Ocwen Loan Servicing, LLC" on Justia Law

by
Allstate Insurance Company et al. (Allstate) filed a complaint on behalf of itself and the People of California (qui tam) against Dr. Sonny Rubin and related medical providers (Rubin). Allstate generally alleged Rubin prepared fraudulent patient medical reports and billing statements in support of insurance claims. Rubin filed an anti-SLAPP motion, arguing the preparation and submission of its medical reports and bills were protected litigation activities. The trial court denied Rubin’s motion. "Litigation is not 'under [serious] consideration' - and thereby protected activity under the anti-SLAPP statute - if the ligation is merely a 'possibility.'" The Court of Appeal found that Rubin failed to show its medical reports and bills were prepared outside of its usual course of business in anticipation of litigation that was “under [serious] consideration.” Thus, the Court affirmed the trial court’s order denying Rubin’s anti-SLAPP motion. View "California ex rel. Allstate Ins. Co. v. Rubin" on Justia Law

by
Hue Thi Dong Mai was sued for breach of contract by a prospective purchaser of the apartment building she owned, brought about because of fraudulent conduct on the part of Mai’s real estate agent. The prospective purchaser ultimately dismissed the breach of contract action, and Mai invoked the “tort of another” doctrine in suing, by cross-complaint, the agent and her employer to recover the attorney’s fees Mai incurred defending the contract action. In the course of that litigation, Mai’s counsel failed to appreciate the difference between presenting a claim for attorney’s fees as damages at trial, and one for fees as costs of suit in a posttrial motion. By its own admission, the trial court was equally confused. The cross-defendants submitted, as dispositive authority, the Court of Appeal decision in Copenbarger v. Morris Cerullo World Evangelism, Inc., 29 Cal.App.5th 1 (2018). Figuring it was bound by Copenbarger, the trial court decided it had no discretion to guide the case to what it believed was a fair resolution. Urging Mai to appeal the decision, it ultimately concluded it could not award anything on her claim for attorney’s fees. Mai appealed, presenting two issues: (1) to what extent did Copenbarger accurately define the minimum showing required to sustain an award of attorney’s fees as damages?; and (2) was the trial court correct in believing that Copenbarger eliminated its discretion to allow Mai to present her attorney’s fee claim on the merits? As to the first issue, the Court of Appeal concluded Copenbarger’s analysis, some of which was dicta, might mislead trial courts by causing them to disregard well-established and binding precedent that predated it. For that reason, the appellate court offered a narrow reading of Copenbarger that harmonized it with other case authority to the extent that was possible. Regarding the second issue, even accepting Copenbarger’s analysis at face value did not, as the trial court here seemed to believe, eliminate all discretion the court possessed to make mid-trial adjustments and accommodations that respect defendants’ right to a fair trial while also allowing plaintiffs to litigate the merits of their claims. Accordingly, judgment was reversed and the matter remanded for a limited retrial on the issue of attorney’s fees as damages in which the court could both apply the proper legal principles and exercise its discretion to achieve substantial justice between the parties. View "Mai v. HKT Cal, Inc." on Justia Law

by
Appellant Pentech Financial Services, Inc. (Pentech) and Respondent Edward Roski, Jr., Trustee of the Roski Community Property Trust Dated November 1, 1987 (Roski), were two of several lien holder defendants in the underlying partition action involving four properties. Pentech obtained the judgment underlying its lien in March 2008. At the first phase of a bifurcated trial in November 2015, the trial court adopted the parties’ stipulation to determine lien priority by the date of recording the judgment lien with the San Diego County Recorder’s Office (Recorder’s Office). In accordance with that stipulation, the trial court determined that Pentech was the priority lien holder. In March 2017, the trial court adopted the parties’ stipulated interlocutory judgment, wherein the parties stipulated that “satisfaction of any judgment or tax lien shall be prioritized by date of recording of such lien with the [Recorder’s Office].” Pentech’s judgment expired in March 2018, by operation of law, when it failed to renew the judgment within the prescribed 10-year period. By then, only one of the four subject properties had been sold. At the second phase of the bifurcated trial in January 2019, the trial court determined that Pentech lost its priority status because it no longer had a valid, enforceable judgment. The court subsequently awarded Roski, as the new priority lien holder, its proportional share of the funds: a sum of $505,957.45 from the sales of all four properties. Pentech admitted it did not renew its judgment. Nonetheless, Pentech contended on appeal that the trial court’s initial determination of priority lien status was final and non-reviewable. In the alternative, Pentech sought modification of the judgment to entitle Pentech to receive a portion of the sale of the one property that sold before its judgment expired. Finally, Pentech argued the judgment should have been reversed and remanded so that the trial court could consider arguments asserted by Pentech for the first time in its objections to a proposed statement of decision. Because these contentions lacked merit, the Court of Appeal affirmed. View "Starcevic v. Pentech Financial Services, Inc." on Justia Law

by
Plaintiffs Charles and Kimberley Bailey petitioned to quiet title to property in Frazier Park, California, based on their alleged adverse possession of the property for a five-year period. Before that period was completed, defendant Citibank, N.A. (Citibank), as successor in interest of a deed of trust recorded against the property long before plaintiffs’ adverse possession began, foreclosed and acquired title to the property under the trustee’s deed. Citibank, however, failed to answer or otherwise respond to the complaint, and its default was entered, and the trial court ultimately entered a judgment quieting title in plaintiffs’ favor. Citibank moved to set aside both the default and the judgment under the mandatory provisions of Code of Civil Procedure section 473, based on Citibank’s attorney’s affidavit of fault. The trial court granted Citibank’s motion, and the default and the judgment quieting title were set aside. Plaintiffs appealed that order on the ground that no basis existed for potential relief under section 473 since Citibank’s attorney was not retained to handle this case until after the default was entered. In response to plaintiffs’ appeal, Citibank filed a protective cross-appeal, arguing that even if relief under section 473 was unavailable, the judgment quieting title in plaintiffs’ favor was erroneous as a matter of law and should have been reversed. The Court of Appeal agreed with Citibank: the undisputed facts showed Citibank was the owner of the property as a matter of law. Judgement was reversed as to the trial court's section 473 ruling and as to quieting title in favor of plaintiffs; on remand the trial court was instructed to enter a new judgment in Citibank’s favor. View "Bailey v. Citibank, N.A." on Justia Law

by
Malekeh Khosravan appealed the denial of her motion to strike or tax costs with respect to the expert witness fees incurred by defendants Chevron Corporation, Chevron U.S.A. Inc., and Texaco Inc. (Chevron defendants) following the trial court’s granting of the Chevron defendants’ motion for summary judgment. Malekeh and her husband Gholam Khosravan brought claims for negligence, premises liability, loss of consortium, and related claims, alleging Khosravan contracted mesothelioma caused by exposure to asbestos while he was an Iranian citizen working for the National Iranian Oil Company (NIOC) at the Abadan refinery the Khosravans alleged was controlled by the predecessors to the Chevron defendants, Exxon Mobil Corporation, and ExxonMobil Oil Corporation (Exxon defendants). The trial court concluded the Chevron and Exxon defendants did not owe a duty of care to Khosravan, and the California Court of Appeal affirmed. The trial court awarded the Chevron defendants their expert witness fees as costs based on the Khosravans’ failure to accept the Chevron defendants’ statutory settlement offers made to Khosravan and Malekeh under Code of Civil Procedure section 998. On appeal, Malekeh contended the trial court erred in denying the motion to strike or tax costs because the settlement offers required the Khosravans to indemnify the Chevron defendants against possible future claims of nonparties, making the offers impossible to value; the Khosravans obtained a more favorable judgment than the offers in light of the indemnity provisions; and the offers were “token” settlement offers made in bad faith. The Court of Appeal concurred with this reasoning and reversed: "We recognize the desire by defendants to reach a settlement that protects them from all liability for the conduct alleged in the complaint, whether as to the plaintiffs or their heirs in a wrongful death action. But if defendants seek that protection through indemnification, they may well need to give up the benefit of section 998." View "Khosravan v. Chevron Corp." on Justia Law

by
There were allegations that Gilead intentionally withheld a safer and potentially more effective HIV/AIDS medication in order to extend the sales window for its older, more dangerous treatment. In 2019, Ramirez, a beneficial owner of Gilead shares, demanded that the company permit him to inspect broad categories of documents for the purpose of “obtaining accurate and complete information about his investment in Gilead, and to find out how the mismanagement and breaches of fiduciary duties at Gilead relating to violations of federal and state laws affect that investment..” Gilead rejected the inspection request. Ramirez then filed a petition for writ of mandate, Corporations Code section 1601, in the superior court asserting common law and statutory rights to inspect the documents described in his demand letter.The trial court denied the petition on the ground that Delaware, Gilead’s state of incorporation, was the sole and exclusive forum to litigate Ramirez’s inspection demand. While his appeal was pending, Ramirez litigated his inspection demand to judgment in Delaware. The court of appeal concluded Ramirez lacks standing to pursue his California inspection demand under section 1601 because he is not a holder of record of Gilead stock. View "Ramirez v. Gilead Sciences, Inc." on Justia Law

by
The Court of Appeal previously issued an opinion in this case on September 18, 2018, in which it affirmed the judgment. The California Supreme Court granted review in January 2019, deferring consideration and disposition until it decided a related issue in Oman v. Delta Air Lines, Inc., 9 Cal.5th 762 (2020). In September 2020, the Supreme Court transferred this matter to the Court of Appeal with directions to vacate the September 18, 2018 opinion and to reconsider this appeal in light of Oman. This case arose from a certified wage and hour class action following a judgment after a bench trial in favor of defendants Certified Tire and Service Centers, Inc. (Certified Tire) and Barrett Business Services, Inc. (collectively defendants). Plaintiffs contended that Certified Tire violated the applicable minimum wage and rest period requirements by implementing a compensation program, which guaranteed its automotive technicians a specific hourly wage above the minimum wage for all hours worked during each pay period, but also gave them the possibility of earning a higher hourly wage for all hours worked during each pay period based on certain productivity measures. After considering the parties’ supplemental briefing on the applicability of Oman to the issues presented in this matter, the Court of Appeal concluded that that plaintiffs’ appeal lacked merit, and accordingly affirmed the judgment. View "Certified Tire & Service Centers Wage & Hour Cases" on Justia Law

by
The Sellers bought an Oakland property to “flip.” After Vega renovated the property, they sold it to Vera, providing required disclosures, stating they were not aware of any water intrusion, leaks from the sewer system or any pipes, work, or repairs that had been done without permits or not in compliance with building codes, or any material facts or defects that had not otherwise been disclosed. Vera’s own inspectors revealed several problems. The Sellers agreed to several repairs Escrow closed in December 2011, but the sewer line had not been corrected. In January 2012, water flooded the basement. The Sellers admitted that earlier sewer work had been completed without a permit and that Vega was unlicensed. In 2014, the exterior stairs began collapsing. Three years and three days after the close of escrow, Vera filed suit, alleging negligence, breach of warranty, breach of contract, fraud, and negligent misrepresentation. Based on the three-year limitations period for actions based on fraud or mistake, the court dismissed and, based on a clause in the purchase contract, granted SNL attorney’s fees, including fees related to a cross-complaint against Vera’s broker and real estate agent.The court of appeal affirmed. Vera’s breach of contract claim was based on fraud and the undisputed facts demonstrated Vera’s claims based on fraud accrued more than three years before she filed suit. Vera has not shown the court abused its discretion in awarding fees related to the cross-complaint. View "Vera v. REL-BC, LLC" on Justia Law

by
On March 21, 2017, following a public hearing, East Bay Regional Park District (EBRPD) committed to accept Pacific Gas and Electric Company (PG&E) funding for “[e]nvironmental [r]estoration and [m]aintenance at Briones Regional Park and LafayetteMoraga Regional Trail.” A staff report explained that PG&E had determined that 245 trees near the gas transmission pipeline on EBRPD property needed to be removed for safety reasons, would pay $1,000 for each tree removed, and would provide replacement trees for 31 District-owned trees within the City of Lafayette, per the City’s ordinance. PG&E would also provide $10,000 for two years of maintenance. Days later EBRPD and PG&E signed an agreement. On June 27, EBRPD filed a Notice of Exemption under the California Environmental Quality Act (CEQA) Pub. Res. Code, 2100. On July 31, opponents and EBRPD entered into an agreement to “toll all applicable statutes of limitations for 60 days” PG&E did not consent.On September 29, opponents sued. The court of appeal affirmed the dismissal of the complaint. The CEQA claim is barred by the 180-day limitation period. PG&E, a necessary and indispensable party to that claim, did not consent to tolling. The non-CEQA claims relating to the city and ABRPD ordinances cannot be amended to allege claims for which relief can be granted. Constitutional due process rights of notice and a hearing did not attach to EBRPD’s quasi-legislative acts. View "Save Lafayette Trees v. East Bay Regional Park District" on Justia Law