Filed 12/6/17; pub. order 12/8/17 publishing the full opn. (see end of opn.)
CERTIFIED FOR PARTIAL PUBLICATION*
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Plumas)
----
DEPARTMENT OF FORESTRY AND FIRE C074879, C076008
PROTECTION et al.,
(Super. Ct. Nos.
Plaintiffs and Appellants, CV09-00205 (lead),
CV09-00231, CV09-00245,
v. CV10-00255, CV10-00264)
EUNICE E. HOWELL et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of Plumas County, Leslie C.
Nichols, Judge. (Retired judge of the Santa Clara Super. Ct., assigned by the Chief
Justice pursuant to art. VI, § 6 of the Cal. Const.) Affirmed in part and reversed in part.
Kamala D. Harris, Attorney General, Kathleen A. Kenealy, Acting Attorney
General, Robert W. Byrne, Assistant Attorney General, Gary E. Tavetian, Evan
Eickmeyer and Daniel M. Lucas, Deputy Attorneys General, for Plaintiffs and Appellants
Department of Forestry and Fire Protection.
* Pursuant to California Rules of Court, rules 8.1105 and 8.1110, this opinion is certified
for publication from inception through the end of part I.B. of the Discussion as well as
the Disposition.
1
Gary S. Garfinkle; Kenneth P. Roye for Plaintiffs and Appellants Brandt et al. and
Grange Insurance Association.
Anderlini & McSweeney LLP, Terry Anderlini and G. Chris Andersen for
Plaintiffs and Appellants Richard Guy et al. and John Cosmez et al.
Downey Brand LLP, William R. Warne, Michael J. Thomas, Annie S. Amaral and
Meghan M. Baker for Defendant and Respondent Sierra Pacific Industries.
Matheny Sears Linkert & Jaime, LLP, Richard S. Linkert and Julia M. Reeves for
Defendants and Respondents W.M. Beaty & Associates, Inc., and Ann McKeever Hatch,
as Trustee, etc., et al.
Rushford & Bonotto, LLP, Phillip R. Bonotto and Derek Vandeviver for
Defendants and Respondents Eunice E. Howell, etc., J.W. Bush and Kelly Crismon et al.
Deborah J. La Fetra and Lawrence G. Salzman for Pacific Legal Foundation as
Amicus Curiae on behalf of Defendants and Respondents.
Morrison & Forester LLP, Christopher J. Carr, William M. Sloan, and Navi Singh
Dhillon for Michael Cole and Tom Hoffman, as Amici Curiae on behalf of Defendants
and Respondents.
Mark Brnovich, Attorney General (Arizona); Doug Peterson, Attorney General
(Nebraska); Adam Paul Laxalt, Attorney General (Nevada); Sean D. Reyes, Attorney
General (Utah), Parker Douglas, Chief Federal Deputy, and Aaron G. Murphy, Assistant
Solicitor General; Brad D. Schimel, Attorney General (Wisconsin), as Amici Curiae on
behalf of Defendants and Respondents.
A wildfire started in Plumas County on September 3, 2007, and burned
approximately 65,000 acres over the course of multiple weeks. This fire, dubbed the
“Moonlight Fire,” was at the center of several actions filed by plaintiffs Department of
Forestry and Fire Protection (Cal Fire), Grange Insurance Association, and multiple
landowners1 in 2009 and 2010 against defendants Eunice E. Howell, individually, and on
1 Cal Fire’s action was deemed the lead case in this complex civil litigation (Plumas
Super. Ct. No. CV09-00205). Landowner plaintiffs include, in order of appearance: case
No. CV09-00231: Gary L. Brown and Sharon Brown; William R. Butler and Peggie L.
Butler; Janet Farmer; Andrea C. Fox and Lynn K. Fox; William C. Goss; K. Ronald
2
behalf of Howell’s Forest Harvesting (hereafter Howell)—the designated lead defendant
and respondent; Kelly Crismon; J.W. Bush; Sierra Pacific Industries (Sierra Pacific);
W.M. Beaty and Associates, Inc. (Beaty); and multiple landowner defendants (landowner
defendants)2 for recovery of fire suppression and investigation costs and for monetary
damages.
On the eve of trial in July 2013, the consolidated actions were dismissed following
a hearing on a motion for judgment on the pleadings and for presentation of a prima facie
Morgan and Dorothea D. Morgan, individually and as trustees of the Orion Trust, LTD,
dated October 1, 1993, and the Evergreen Trust, dated 1985; Patricia Qualls; George B.
Wieck and Dorta Lee Wieck; Donald J. Wilson; Richard A. Guy and Edith E. White; case
No. CV10-00255: James H. Brandt and Ellen E. Brandt, individually and as trustees of
the James H. Brandt Trust, dated October 7, 2004; and case No. CV10-00264: Robert V.
Kile and Dawn A. Kile, as cotrustees of the Kile Family Trust, dated October 13, 2004;
Erik Weber and Sally Weber; Robert Cross; Kenneth J. Zeits and Jessie Zeits, as
cotrustees of the Zeits Family Trust; and John Cosmez and Christine Cosmez. Grange
Insurance Association appeared to recover damages paid to some of these landowner
plaintiffs (case No. CV09-00245).
2 Landowner defendants include Ann McKeever Hatch, as trustee of the Hatch 1987
Revocable Trust; Richard L. Greene, as trustee of the Hatch Irrevocable Trust; Brooks
Walker, Jr., as trustee of the Brooks Walker, Jr., Revocable Trust and the Della Walker
Van Loben Sels Trust for the Issue of Brooks Walker; Jr.; Brooks Walker III,
individually and as trustee of the Clayton Brooks Danielsen Trust, the Myles Walker
Danielsen Trust, the Margaret Charlotte Burlock Trust, and the Benjamin Walker
Burlock Trust; Leslie Walker, individually and as trustee of the Brooks Thomas Walker
Trust, the Susie Kate Walker Trust, and the Della Grace Walker Trust; Wellington Smith
Henderson, Jr., as trustee of the Henderson Revocable Trust; Elena D. Henderson; Mark
W. Henderson, as trustee of the Mark W. Henderson Revocable Trust; John C. Walker,
individually and as trustee of the Della Walker Van Loben Sels Trust for the Issue of
John C. Walker; James A. Henderson; Charles C. Henderson, as trustee of the Charles C.
and Kirsten Henderson Revocable Trust; Joan H. Henderson; Jennifer Walker,
individually and as trustee of the Emma Walker Silverman Trust and the Max Walker
Silverman Trust; Kirby Walker; and Lindsey Walker or Lindsey Walker-Silverman,
individually and as trustee of the Reilly Hudson Keenan Trust and the Madison Flanders
Keenan Trust.
3
case pursuant to Cottle v. Superior Court (1992) 3 Cal.App.4th 1367 (Cottle)3 after the
trial court concluded Cal Fire could not as a matter of law state a claim against Sierra
Pacific, Beaty, or landowner defendants, and that no plaintiff had presented a prima facie
case against any defendant. After judgment was entered, the trial court awarded
defendants costs without apportionment amongst plaintiffs. It also ordered Cal Fire to
pay to defendants attorney fees and expert fees totaling more than $28 million because
defendants as prevailing parties were entitled to recover attorney fees on either a
contractual basis or as private attorneys general, or alternatively as discovery sanctions.
The trial court additionally imposed terminating sanctions against Cal Fire. Plaintiffs
appeal, challenging both the judgment of dismissal (case No. C074879) and the
postjudgment awards (case No. C076008).4 Plaintiffs also request that any hearings on
remand be conducted by a different judge.
In the published portion of this opinion, we conclude the trial court’s order
dismissing the case as to all plaintiffs based on their failure to present a prima facie case
at a pretrial hearing under the authority of Cottle must be reversed because the hearing
was fundamentally unfair: Plaintiffs were not provided adequate notice of the issues on
which they would be asked to present their prima facie case. However, we conclude the
trial court did properly award judgment on the pleadings against Cal Fire. In light of
these conclusions, in the unpublished portion of this opinion, we find the trial court’s
award of costs to defendants as prevailing parties as to any plaintiff but Cal Fire is
necessarily vacated, and because the trial court did not apportion costs, we must remand
3 Cottle allows a trial court overseeing complex civil litigation to require a party to
present a prima facie claim establishing some element of their cause of action prior to
trial in a nonstatutory procedure established by the trial court based on its “inherent
equity, supervisory and administrative powers.” (Cottle, supra, 3 Cal.App.4th at
pp. 1376-1377, 1381.)
4 The two appeals were consolidated for purposes of oral argument and decision only.
4
the costs award to the trial court for further proceedings to determine which costs Sierra
Pacific, Beaty, and landowner defendants may recover from Cal Fire. Also in the
unpublished portion of this opinion, we conclude the trial court erred in awarding
attorney fees to the prevailing parties, and that the award of monetary discovery sanctions
must be reversed and remanded for further proceedings. We affirm, however, the
imposition of terminating sanctions against Cal Fire. Finally, we reject plaintiffs’
requests that we order any remand proceedings be heard by a different judge.
FACTUAL AND PROCEDURAL BACKGROUND
Cal Fire’s investigation of the Moonlight Fire determined that the fire started on
property owned by landowner defendants and managed by Beaty. Sierra Pacific
purchased the standing timber on the property, and contracted with Howell, a licensed
timber operator, to cut the timber. On the day the Moonlight Fire began, two of Howell’s
employees, Bush and Crismon, were working on the property installing water bars.5
Cal Fire’s investigators concluded the fire began when the bulldozer Crismon was
operating struck a rock or rocks, causing superheated metal fragments from the
bulldozer’s track to splinter off and eventually to ignite surrounding plant matter, and that
the fire was permitted to spread when Bush and Crismon failed to timely complete a
required inspection of the area where they had been working that day.
Over the course of four years, the parties engaged in extensive discovery and
pretrial motions in both this consolidated action and in a concurrent federal action. The
trial court designated the state court action as complex litigation under California Rules
of Court, rule 3.403(b) and Standard 3.10 of the California Standards of Judicial
Administration. About three months before trial was to commence, retired Judge Leslie
C. Nichols was appointed to preside over all proceedings in this case. Beginning in June
5 Water bars are berms or mounds designed to control erosion.
5
2013, Judge Nichols ruled on nearly 100 motions in limine and reviewed the thousands of
pages that made up the record in the case, including the trial briefs submitted by the
parties on July 15, 2013. In a footnote in its trial brief, Sierra Pacific purportedly moved
for judgment on the pleadings as to Cal Fire, contending Cal Fire had not asserted a cause
of action pursuant to Health and Safety Code sections 13009 or 13009.1,6 which were the
sole basis for Cal Fire to recover its fire suppression and investigation costs. Sierra
Pacific asserted Cal Fire’s claims premised on common law should be dismissed prior to
trial.
On July 22, 2013, exactly one week before trial was set to commence, the trial
court issued a “notice to counsel.” In that notice, the trial court indicated that during the
previously scheduled pretrial hearing—set for July 24, 25, and 26 (if necessary)—it
would be prepared to hear any motions for judgment on the pleadings defendants
intended to advance; it would share its views on the likelihood certain jury instructions
would be presented; it would address whether common law claims could be asserted; it
would also discuss with counsel and issue rulings regarding issues raised during the
hearing including whether expert testimony would be required to present evidence of the
standard of care, and, if so, the viability of claims and evidence supporting them. The
court also indicated it “may, with the assistance of counsel, identify claims or issues
susceptible to the conduct of a hearing authorized by Cottle[, supra,] 3 Cal.App.4th [at
page] 1381 . . . that is to determine whether a prima facie case can be established before
the start of the trial.”
At the end of this pretrial hearing, the trial court entered orders dismissing the case
based on its finding that all plaintiffs failed to make a prima facie showing that they could
sustain their burden of proof against any defendant, and granting an oral motion for
6 Undesignated statutory references are to the Health and Safety Code.
6
judgment on the pleadings against Cal Fire only as to Sierra Pacific, Beaty, and
landowner defendants, based on its finding that sections 13009 and 13009.1 did not
provide a legal basis for relief as to those parties.7 Judgment of dismissal was entered in
favor of defendants on July 26, 2013.
Approximately six months after the judgment of dismissal was entered, the trial
court heard plaintiffs’ motions to tax defendants’ costs. Following extensive briefing and
argument by the parties, the trial court awarded costs to all defendants, for which it made
all plaintiffs jointly and severally liable.
Postjudgment, the trial court also heard defendants’ motions for attorney fees,
expenses, and discovery sanctions. In September 2013, the trial court established a
phased briefing schedule for the motions, with the parties to first focus on entitlement to
the fees, expenses, and sanctions, and thereafter to focus on the proper amount, if any, of
such an award. In late October 2013, after defendants had filed their opening briefs in the
first phase of postjudgment motions, defendants informed the trial court they had learned
of new evidence Cal Fire had failed to produce during pretrial discovery in violation of
previous court orders. As a result of this development, Cal Fire acknowledged it had
“ ‘inadvertently’ ” failed to produce the document in question and some 5,000 other
pages of responsive documents. The trial court ordered Cal Fire to produce the
documents, and all responsive documents, by the end of October 2013. Cal Fire
produced about 5,000 pages of documents and, at a court appearance in early November
2013, represented to the trial court that it had produced all responsive documents. A
couple of weeks later, at the end of its brief relating to the earlier production of
documents, Cal Fire acknowledged that there were an additional 2,000 pages of
7 One plaintiff, California Engels Mining Company, dismissed the case against
defendants with prejudice in exchange for a waiver of costs on the eve of trial and is not
subject to the challenged order of dismissal.
7
responsive documents that still had not been produced. It produced those documents in
late November 2013.
The trial court found it was appropriate to assess monetary and terminating
sanctions against Cal Fire for engaging in pervasive discovery abuses. Among the
enumerated exemplar abuses the trial court identified were Cal Fire’s failure to produce
responsive documents in violation of court orders, false deposition testimony by
Cal Fire’s lead investigator, falsification of interview statements incorporated into
Cal Fire’s discovery responses, spoliation of Cal Fire’s investigator’s notes, and inclusion
of false reports in Cal Fire’s discovery responses. The trial court also found defendants
were entitled to cost-of-proof expenses for disproving Cal Fire’s denial of certain
requests for admission. Finally, the trial court found defendants were entitled to attorney
fees as prevailing parties both on a contractual basis (Civ. Code, § 1717) and because the
case resulted in a public benefit (Code Civ. Proc., § 1021.5).
Based both on its inherent authority and the Civil Discovery Act (Code Civ. Proc.,
§ 2016.010 et seq.), the trial court imposed terminating sanctions in favor of all
defendants and against Cal Fire. In addition, the trial court collectively awarded Beaty
and landowner defendants attorney fees and expert witness fees of $6,146,901.41 as “a
prevailing party,” and made Cal Fire liable for the entirety of the award. The trial court
also ordered Cal Fire to pay an equal amount as a sanction, but stated that the entire
obligation established by the order was $6,146,901.41. The trial court also collectively
awarded attorney fees of $1,166,155 and expert costs of $405,586.08 to Howell, Bush,
and Crismon, either as discovery sanctions or prevailing parties. Finally, the trial court
awarded Sierra Pacific attorney fees and expert fees and costs of $21,881,484, as
discovery sanctions or in the alternative as a prevailing party.
8
Additional factual and procedural information is provided as relevant in the
ensuing discussion.8
DISCUSSION
I. Challenges to Judgment of Dismissal
Plaintiffs collectively challenge the trial court’s judgment of dismissal by
challenging, on both procedural and substantive grounds, its order finding plaintiffs had
not presented a prima facie case. Cal Fire also separately challenges the trial court’s
order granting judgment on the pleadings based on its conclusion sections 13009 and
13009.1 do not permit Cal Fire to state claims arising from common law negligence
theories. We reverse the trial court’s judgment of dismissal based on its Cottle hearing
because we conclude the conduct of that hearing violated defendants’ procedural due
process rights.9 However, we affirm the trial court’s judgment of dismissal to the extent
it was premised on its grant of judgment on the pleadings because we agree sections
13009 and 13009.1 do not incorporate common law theories of negligence as a basis for
recovery.
A. Cottle Hearing
Plaintiffs challenge the trial court’s dismissal of the action, raising procedural and
substantive challenges to the trial court’s provision of notice of a hearing based on Cottle
8 We deny the multiple requests for judicial notice made in this court because the
information presented therein, relating to the federal litigation premised on the Moonlight
Fire and the amount of notice given prior to a Cottle hearing in two unrelated cases, is not
relevant or necessary to our resolution of the issues on appeal in cases Nos. C074879 and
C076008. (Evid. Code, §§ 452, 459.)
9 We would address plaintiffs’ challenge to the dismissal based on the Cottle hearing
regardless of how we rule on the dismissal pursuant to the motion for judgment on the
pleadings because judgment on the pleadings was entered only as to one plaintiff and
some of the defendants.
9
and its finding that plaintiffs failed to present a prima facie case in support of their causes
of action. Based on our conclusion that the hearing suffered prejudicial procedural
errors, we need not reach the parties’ substantive challenges to the trial court’s order. As
a result of this conclusion, we reverse the trial court’s judgment of dismissal premised on
its finding plaintiffs failed to present a prima facie case in support of their causes of
action.
1. Additional background.
One week before trial was to commence, the trial court issued a two-page notice to
counsel, in which it decreed sua sponte that during the already scheduled pretrial hearing
set to commence in two days’ time, it would hear any oral motions for judgment on the
pleadings any defendant wished to advance; it would share its views on the likelihood
that certain jury instructions would be given and its views on some arguments advanced
by the parties on whether general negligence claims could be advanced; it would hear
discussion and issue rulings regarding the necessity of expert testimony, and the effect of
that ruling on the viability of claims asserted; it would work with counsel to minimize
evidentiary disputes and to organize exhibits and evidence; and it “may, with the
assistance of counsel, identify claims or issues susceptible to the conduct of a hearing
authorized by Cottle[, supra,] 3 Cal.App.4th [at page] 1381 . . . that is to determine
whether a prima facie case can be established before the start of the trial.”
When they appeared for the pretrial hearing on July 24, 2013, the parties presented
bench briefs on some of the issues identified in the trial court’s notice and asserted their
preparedness to discuss others. Sierra Pacific proceeded to move for judgment on the
pleadings as to all of Cal Fire’s claims, for failure to state a cause of action. Before
presenting arguments on that motion, Sierra Pacific also stated its intention to move
“under Cottle for the Court to require a prima facie showing from all plaintiffs on various
issues.” Argument on the motion for judgment on the pleadings took the entirety of the
10
morning session that day, with Cal Fire being invited to submit a written opposition to the
motion “promptly.”
During the afternoon session, defendants identified two “insurmountable”
causation issues for all plaintiffs: (1) the fire was reported within the two-hour window
after cessation of yarding activity that would trigger inspection requirements under
California Code of Regulations, title 14, section 938.8,10 and Bush was returning to
conduct an inspection within that two-hour window but by the time he arrived the fire
was already burning uncontrollably; and (2) as it is alleged the fire remained in an
“incipient state” for an hour and a half, there is no evidence a diligent inspection would
have detected the fire. Additionally, defendants argued there was no evidence that
different conduct by any defendant other than Howell, Bush, or Crismon would have
changed the outcome on September 3, 2007, to support plaintiffs’ claims of negligent
supervision, negligent hiring, negligent retention, or negligent maintenance. Defendants
also argued there was an absence of evidence of Howell’s or Beaty’s violation of the
standard of care because no plaintiff had offered an expert to testify in that regard and
Howell’s policies could not be used to establish the standard of care.
Thus, it was not until later in the afternoon session on July 24, 2013, that the
issues on which plaintiffs would be called to present a prima facie case were even
identified. Counsel for plaintiffs presented argument and offers of proof on the afternoon
of July 24. On July 25, counsel for Cal Fire and Howell presented a substantial amount
of evidence and argument regarding the causation and standard of care issues highlighted
10 California Code of Regulations, title 14, section 938.8, subdivision (a) provides in
relevant part: “The timber operator or his/her agent shall conduct a diligent aerial or
ground inspection within the first [two] hours after cessation of felling, yarding, or
loading operations each day during the dry period when fire is likely to spread. The
person conducting the inspection shall have adequate communication available for
prompt reporting of any fire that may be detected. . . .”
11
by counsel for defendants the previous day, and defendants presented counter-arguments
and challenged the offers of proof of evidence presented. Toward the end of the day on
July 25, the trial court directed defendants to prepare a proposed order laying out the
deficiencies in plaintiffs’ case to be distributed that night, with an opportunity to cure to
be given the following day.
Then, on July 26, 2013, when court reconvened, the parties argued the motion for
judgment on the pleadings. It was not until that motion was submitted that plaintiffs were
permitted to again present their prima facie case, at which time plaintiffs objected to the
Cottle procedure as applied in this case, and presented further arguments relating to the
Cottle “motion.” During this time period, the parties also presented briefs to the court on
any number of other issues still undecided, including, for example, jury instructions,
whether expert testimony was required to establish the standard of care and breach
thereof, and the motion for judgment on the pleadings. Late in the afternoon on July 26,
the trial court deemed the case submitted and entered an order dismissing the case based
on its finding that plaintiffs failed to establish a prima facie case.
2. Legal background.
Cottle involved an action filed by approximately 175 owners and renters of
residential property who sued the property developers for personal injuries, emotional
distress, and property damage arising from development on a site that was previously
used as a depository for hazardous waste and byproducts. (Cottle, supra, 3 Cal.App.4th
at pp. 1371-1372.) During discovery, the plaintiffs responded to an interrogatory asking
for a detailed description of the illness they claimed to suffer from exposure to chemical
substances by stating generally that they had not yet identified any injuries caused by
chemical exposure but reserving the right to assert a claim if more information became
available. (Id. at p. 1372.)
12
On November 7, 1990, the trial court issued a case management order requiring
that each plaintiff file and serve by February 1, 1991, a statement establishing a prima
facie claim for personal injury and/or property damage, including details as to exposure,
injury, and expert support with regard to any personal injury claim. (Cottle, supra,
3 Cal.App.4th at p. 1373.) The plaintiffs filed their statements on January 7, 1991, in
which they stated it was “ ‘virtually impossible’ ” to determine the specific chemicals to
which they were exposed or when and that none had been diagnosed with an injury
directly caused by exposure to any chemical present at or around the development, and
that their treating physicians did not have the benefit of knowing they were exposed to
toxic chemicals. (Ibid.) The court set a hearing on March 4, 1991, on a motion to
dismiss their claims for failure to make a prima facie showing. (Id. at p. 1374.) On
March 12, 1991, the trial court found the plaintiffs had shown a prima facie case for their
emotional distress and property damages claims but not their personal injury claims, and
tentatively ordered exclusion of all evidence that plaintiffs suffer any particular physical
injury based on exposure to chemicals at the development unless the plaintiffs could
demonstrate by May 31, 1991, that viable claims for personal injury existed. (Ibid.)
The plaintiffs submitted supplemental statements on May 31, 1991, including
declarations from a toxicologist and two neuropsychologists. (Cottle, supra,
3 Cal.App.4th at p. 1375.) On June 27, 1991, the trial court conducted a hearing to
determine whether the supplemental statements established a prima facie showing for
personal physical injury. (Ibid.) The trial court concluded no witness presented any
statement or testimony establishing to a reasonable medical probability that any
hazardous or toxic substance caused any injury or illness in any plaintiff. (Ibid.)
Accordingly, on July 2, 1991, the trial court entered an order in limine excluding all
evidence of personal injury. (Ibid.)
13
In defending the trial court’s authority to issue such an order, the Court of Appeal,
Second Appellate District, Division Seven, reasoned that courts have “inherent equity,
supervisory and administrative powers” derived from the Constitution, in addition to
statutory authority to control the proceedings which they oversee. (Cottle, supra,
3 Cal.App.4th at p. 1377.) Thus, Cottle explained, “ ‘ “ ‘[c]ourts have inherent power . . .
to adopt any suitable method of practice, both in ordinary actions and special
proceedings, if the procedure is not specified by statute or by rules adopted by the
Judicial Council.’ ” That inherent power entitles trial courts to exercise reasonable
control over all proceedings connected with pending litigation . . . in order to insure the
orderly administration of justice.’ ” (Id. at p. 1378.)
Thus, Cottle recognized that “courts have the power to fashion a new procedure in
a complex litigation case to manage and control the case before them.” (Cottle, supra,
3 Cal.App.4th at p. 1380.) Although Cottle did not set forth any precise guidelines, it
encouraged consideration of “the totality of the circumstances,” and concluded the timing
of the order in that case was “crucial to its legitimacy.” (Ibid.) The exclusion order was
issued a month prior to the anticipated start of a one- to two-year-long trial and after
discovery was closed. (Ibid.) Therefore, Cottle approved the trial court’s use of its
inherent powers to manage complex litigation by ordering exclusion of evidence when
the plaintiffs are unable to establish a prima facie case prior to the start of trial. (Id. at
p. 1381.)
Cottle further rejected the plaintiffs’ contention that they were deprived of due
process, holding, “[e]ven though the nature of the proceedings in the court changed, it
was clear that what the court wanted was for petitioners [(the plaintiffs)] to make a prima
facie showing of their physical injury claims. Accordingly, [the plaintiffs] had notice of
what was actually required of them as well as extensive opportunity to present evidence
and argue the issue.” (Cottle, supra, 3 Cal.App.4th at p. 1384.)
14
In the nearly three decades since Cottle was decided, two published cases have
affirmed a trial court’s use of Cottle-type proceedings. In Lockheed Martin Corp. v.
Continental Ins. Co. (2005) 134 Cal.App.4th 187, 193, Lockheed Martin sought coverage
under numerous policies for pollution-related liability. The trial court organized the
litigation, involving that suit and others, into phases with one phase set to be tried to a
jury. (Id. at p. 195.) Prior to trial, the trial court (Judge Leslie C. Nichols, who was also
the trial judge here) conducted a Cottle hearing that “require[ed] the parties to produce
evidence to support a prima facie case on every issue for which the party had the burden
of proof.” (Lockheed, at p. 195.) Lockheed Martin submitted evidence, including a
series of declarations from employees and experts, of 14 accidents it claimed resulted in
the release of pollutants at a specific location. (Id. at pp. 211, 213.) When Lockheed
Martin failed to prove its claim of coverage for contamination at one location, the trial
court excluded evidence leading to dismissal of its indemnity claims. (Id. at p. 195.)
While no specific timeline is described in Lockheed, it is apparent the litigation lasted 10
years and there was ample time provided for the parties to accumulate declarations and
other evidence prior to the hearing. (Id. at pp. 193, 213-214.)
And, in Alexander v. Exxon Mobil (2013) 219 Cal.App.4th 1236, 1243-1245, a
case involving several hundred plaintiffs with toxic tort claims, the trial court required
offers of proof demonstrating causation to be submitted with an amended complaint to be
filed following the sustaining of a demurrer. The reviewing court indicated it had
“significant concerns about a procedure requiring detailed sworn affidavits at the
pleading stage,” but assumed the order was valid because the plaintiffs had not raised any
issues challenging it. (Id. at p. 1245, fn. 3.)
The infrequent application of Cottle is perhaps unsurprising in light of extensive
scrutiny of its reasoning. In the dissent to Cottle, authored by Justice Johnson, it was
highlighted that until Cottle, “resort to a trial court’s inherent authority to craft new rules
15
of civil procedure [was] only a proper exercise of inherent powers when made necessary
because of the absence of any statute or rule governing the situation. Thus, the rationale
for devising new rules of procedure has historically been one of necessity. In other
words, to fill a void in the statutory scheme, a court had a duty to create a new rule of
procedure in the interests of justice and in order to exercise its jurisdiction.” (Cottle,
supra, 3 Cal.App.4th at p. 1391 (dis. opn. of Johnson, J.).) And none of the prior
judicially created procedures involved deciding the merits of a cause of action thereby
removing it from a jury’s consideration. (Ibid.)
Subsequent authority too has challenged the scope of the court’s inherent authority
relied upon in Cottle. Rutherford v. Owens-Illinois, Inc. (1997) 16 Cal.4th 953, 967,
citing Cottle, acknowledged the courts’ “fundamental inherent equity, supervisory, and
administrative powers, as well as inherent power to control litigation before them,” but
observed the courts’ powers to fashion new procedures is not boundless (id. at pp. 967-
968). Rather, “inherent power may only be exercised to the extent not inconsistent with
the federal or state Constitutions, or California statutory law.” (Stephen Slesinger, Inc. v.
Walt Disney Co. (2007) 155 Cal.App.4th 736, 762 (Slesinger); see Elkins v. Superior
Court (2007) 41 Cal.4th 1337, 1351-1352; see also Hernandez v. Superior Court (2003)
112 Cal.App.4th 285, 296-300 [vacating trial court’s order requiring statements from
plaintiffs demonstrating prima facie showing of causation because it required early and
unilateral disclosure of expert witness information rather than the mutual and
simultaneous disclosure contemplated by the discovery statutes]; First State Ins. Co. v.
Superior Court (2000) 79 Cal.App.4th 324, 330, 333-336 [rejecting trial court’s case
management order because it required resolution of choice of law before any dispositive
motion could be filed, which conflicts with statutes authorizing filing of motions for
summary judgment or summary adjudication].) Thus, “[a]lthough broad in scope, this
inherent power to fashion novel procedures is not unlimited. A court cannot adopt an
16
innovative rule or procedure without carefully weighing its impact on the constitutional
rights of the litigants.” (In re Amber S. (1993) 15 Cal.App.4th 1260, 1264-1265.)
So too has the use of other motions in limine to hear disguised dispositive motions
been criticized. For example, a court may employ its inherent powers, including the
“ ‘inherent power to control litigation and conserve judicial resources,’ ” to use a motion
in limine to test whether a complaint states a cause of action. (K.C. Multimedia, Inc. v.
Bank of America Technology & Operations, Inc. (2009) 171 Cal.App.4th 939, 951; see
Lucas v. County of Los Angeles (1996) 47 Cal.App.4th 277, 284-285.) However, in
limine motions are designed to prevent admission of evidence where it would be
impossible to “ ‘ “unring the bell” ’ ” if the evidence is presented to the jury, not to
replace statutorily prescribed dispositive motions. (Amtower v. Photon Dynamics, Inc.
(2008) 158 Cal.App.4th 1582, 1593.) Nonetheless, trial courts have used motions in
limine to dismiss a cause on the pleadings, to examine the sufficiency of the evidence, or
to require a party to make an offer of proof tantamount to an opening statement, which in
effect amounts to a demurrer to the evidence or motion for nonsuit. (Id. at pp. 1593-
1594; see Coshow v. City of Escondido (2005) 132 Cal.App.4th 687, 701-702.)
Reviewing courts are “becoming increasingly wary of this tactic” in large part because
the procedural shortcuts “circumvent procedural protections provided by the statutory
motions or by trial on the merits; . . . risk blindsiding the nonmoving party; and, in some
cases, . . . could infringe a litigant’s right to a jury trial.” (Amtower, supra, at p. 1594.)
Concerns about procedural shortcuts may also implicate constitutional issues.
“Both the federal and state Constitutions compel the government to afford persons due
process before depriving them of any property interest. (U.S. Const., 14th Amend. [‘nor
shall any state deprive any person of life, liberty, or property, without due process of
law’]; Cal. Const., art. I, § 7, subd. (a) [‘A person may not be deprived of life, liberty, or
property without due process of law . . . .’].)” (Today’s Fresh Start, Inc. v. Los Angeles
17
County Office of Education (2013) 57 Cal.4th 197, 212 (Today’s Fresh Start).) This
requires that a party at risk of loss be given notice and an opportunity to be heard, “ ‘at a
meaningful time and in a meaningful manner.’ ” (Ibid.) This is a flexible requirement,
varying with the circumstances of any given case. (Id. at pp. 212-213.) The function of
the legal process afforded by these constitutional mandates is to minimize the risk of
erroneous decisions. (Id. at p. 212.) And, if due process was not afforded before an order
depriving the party of his or her interest was entered, we must reverse the order. (Koshak
v. Malek (2011) 200 Cal.App.4th 1540, 1550.)
3. Analysis.
In determining whether due process was afforded here, we adopt the balancing test
set forth in Mathews v. Eldridge (1976) 424 U.S. 319, 335 [47 L.Ed.2d 18, 33]. (Today’s
Fresh Start, supra, 57 Cal.4th at p. 213.) This requires us to consider, “ ‘first, the private
interest that will be affected by the official action; second, the risk of an erroneous
deprivation of such interest through the procedures used, and the probable value, if any,
of additional or substitute procedural safeguards; and, third, the Government’s interest,
including the function involved and the fiscal and administrative burdens that the
additional or substitute procedural requirement would entail.’ ” (Ibid.)
That there is a private interest affected here is of little doubt. “Due process
requires notice before a dismissal of a case may be entered.” (Lee v. Placer Title Co.
(1994 ) 28 Cal.App.4th 503, 510; see Cordova v. Vons Grocery Co. (1987)
196 Cal.App.3d 1526, 1531; see also Wilson v. Sunshine Meat & Liquor Co. (1983)
34 Cal.3d 554, 561, fn. 7.) For, if a plaintiff’s case is dismissed without due process, that
party’s right of access to the courts is infringed. (See generally Payne v. Superior Court
(1976) 17 Cal.3d 908, 914.) Having established that a right requiring procedural due
process protections is implicated, we consider the remaining factors.
18
The risk of an erroneous deprivation was high as a result of the procedures
implemented in this case. Plaintiffs were not provided advance notice of the issues they
would be asked to address at the hearing, which resulted in a dismissal of their entire
actions. Rather, they were notified by the trial court two days before the hearing, and one
week before a multi-month trial was to commence, that it “may” identify issues, with the
aid of counsel, on which to conduct a Cottle hearing. However, Cottle and the cases that
have implemented it provided parties weeks or months to collect information to present a
prima facie case on a select and enumerated issue, and then provided the presenting party
an opportunity to cure any perceived deficiencies in that presentation. None of that was
provided here. While also arguing a motion for judgment on the pleadings, and jury
instructions, plaintiffs were required on a half-day’s notice to present a prima facie case
on causation and on standard of care, without being given an adequate or meaningful
opportunity to contact their witnesses or to gather the required information, even from the
extensive discovery that had already been completed. Had the trial court identified the
issues it perceived deficient upon reading the trial briefs or even in the notice to counsel,
it could have continued trial to provide plaintiffs an adequate opportunity to present their
prima facie case and to cure any deficiencies. Without doing so, plaintiffs did not have
the requisite meaningful notice and opportunity to avoid dismissal of their entire case.
The only identifiable governmental interest impacted by the provision of
additional procedural protections, i.e., advance notice of the issues to be presented and a
meaningful opportunity to gather evidence to present, are the fiscal and administrative
burden of conducting trial as scheduled. However, this too could have been ameliorated
had the trial court identified the issues for which it required a prima facie presentation
immediately following its review of the trial briefs—apparently the precipitating force
behind its decision to utilize Cottle to narrow the issues of the case—two full weeks
before trial was to commence. For example, the trial court could have continued trial at
19
that point, which would have permitted the court to contact jurors and to adjust the
courthouse schedule to allow time for the Cottle hearing to be noticed and heard, with an
opportunity to cure any deficiencies before an order was entered. Additionally, this
interest is minor in contrast to the potential for erroneous dismissal of the entire case
through the procedures implemented.
Balancing these factors, on the facts before us, we conclude plaintiffs’ due process
rights were infringed by the manner in which the trial court noticed and conducted the
Cottle hearing. Accordingly, we reverse the judgment of dismissal premised on the trial
court’s July 26, 2013 order finding plaintiffs failed to establish a prima facie case.
B. Judgment on the Pleadings
As noted above, during the pretrial hearing less than a week before trial was to
commence, Sierra Pacific made an oral motion for judgment on the pleadings as to the
claims presented by Cal Fire.11 The gist of the motion was that sections 13009 and
13009.1, on which Cal Fire’s claims were necessarily premised,12 limited recovery for
direct liability and did not incorporate common law theories of negligence. Cal Fire
disagreed, arguing use of the word “negligently” in section 13009 incorporates common
law theories of negligence into permissible grounds for recovery of fire suppression and
investigation costs. The trial court granted judgment on the pleadings to defendants
11 Beaty and landowner defendants also joined in the motion, and Sierra Pacific argued
it was applicable to all defendants excepting Howell, Crismon and Bush.
12 In its complaint, Cal Fire sought to recover its fire suppression costs under sections
13009 and 13009.1. To that end, it alleged that all defendants violated California Code of
Regulations, title 14, section 938.8 (requiring inspection following certain timber
operations) and were negligent in starting the Moonlight Fire and allowing it to spread;
additionally, against Beaty and the landowner defendants, it alleged negligent
management and use of land; against Sierra Pacific, Beaty, the landowner defendants,
and Howell, it also alleged negligent supervision and inspection; and against Sierra
Pacific alone it alleged negligence based on a peculiar risk.
20
Sierra Pacific, Beaty, and landowner defendants (leaving only Cal Fire’s claims against
Howell, Bush, and Crismon). Cal Fire now appeals that order, claiming use of the word
“negligently” in the statute incorporates common law theories of negligence, including
vicarious liability, and that the inclusion of a corporation as a “ ‘[p]erson’ ” in section 19
requires the same conclusion. We conclude the trial court did not err in awarding
judgment on the pleadings.
In construing sections 13009 and 13009.1, we extend no deference to the trial
court’s interpretation, but instead review the question of law regarding statutory
construction de novo. (John v. Superior Court (2016) 63 Cal.4th 91, 95.) “ ‘Our primary
task in interpreting a statute is to determine the Legislature’s intent, giving effect to the
law’s purpose. [Citation.] We consider first the words of a statute, as the most reliable
indicator of legislative intent.’ ” (Id. at pp. 95-96.) We construe the language in the
context of the entire statutory framework, with consideration given to the policies and
purposes of the statute. (Jones v. Superior Court (2016) 246 Cal.App.4th 390, 397.) In
so construing the statute, we may not “insert what has been omitted, or . . . omit what has
been inserted.” (Code Civ. Proc., § 1858.) We also recognize that “ ‘ “where a statute,
with reference to one subject contains a given provision, the omission of such provision
from a similar statute concerning a related subject is significant to show that a different
legislative intent existed with reference to the different statutes.” ’ ” (Los Angeles County
Metropolitan Transportation Authority v. Alameda Produce Market, LLC (2011)
52 Cal.4th 1100, 1108 (Alameda Produce).)
At common law, there was no recovery of government-provided fire suppression
costs; that recovery is purely a creature of statute. (City of Los Angeles v. Shpegel-
Dimsey, Inc. (1988) 198 Cal.App.3d 1009, 1020 (Shpegel-Dimsey).) A governmental
decision to provide tax-supported services, such as police or fire responses to
emergencies, is a legislative policy determination. (Id. at p. 1018.) Thus, “ ‘in the
21
absence of a statute expressly authorizing recovery of public expenditures [(i.e., police,
fire and other emergency services)], “the cost of public services for protection from fire
or safety hazards is to be borne by the public as a whole, not assessed against the
tortfeasor whose negligence creates the need for the service.” ’ ” (Ibid.) Therefore,
Cal Fire’s ability to recover its fire suppression costs is strictly limited to the recovery
afforded by statute.
The statutes in question here, sections 13009 and 13009.1, provide as follows. In
pertinent part, section 13009, subdivision (a) states that “[a]ny person . . . who
negligently, or in violation of the law, sets a fire, allows a fire to be set, or allows a fire
kindled or attended by him or her to escape onto any public or private property . . . is
liable for the fire suppression costs incurred in fighting the fire and for the cost of
providing rescue or emergency medical services, and those costs shall be a charge against
that person. . . .” Section 13009.1 states that “[a]ny person . . . who negligently, or in
violation of the law, sets a fire, allows a fire to be set, or allows a fire kindled or attended
by him or her to escape onto any public or private property . . . is liable for both of the
following: [¶] (1) [t]he cost of investigating and making any reports with respect to the
fire[;] [and] [¶] (2) [t]he costs relating to accounting for that fire and the collection of
any funds pursuant to Section 13009, including, but not limited to, the administrative
costs of operating a fire suppression cost recovery program. . . .” (§ 13009.1, subd. (a).)
A “person” for purposes of these statutes is “any person, firm, association, organization,
partnership, business trust, corporation, limited liability company, or company.” (§ 19.)
As the language of the statute itself does not clearly delineate the impact of the
inclusion of the term “negligently,” we turn to legislative history for guidance. In 1931,
the Legislature enacted chapter 790, which provided that an owner whose property was
damaged could recover from “[a]ny person who: [¶] (1) [p]ersonally or through
another, and (2) [w]ilfully, negligently, or in violation of law, commits any of the
22
following acts: (1) [s]ets fire to, (2) [a]llows fire to be set to, (3) [a]llows a fire kindled
or attended by him to escape to the property, whether privately or public owned, of
another” or “[a]ny person” who allowed a fire burning on his property to escape to
another’s property “without exercising due diligence to control such fire.” (Stats. 1931,
ch. 790, §§ 1-2, p. 1644, italics added.) Chapter 790 also permitted recovery of the
expenses of fighting such fires “by the party, or by the federal, state, county, or private
agency incurring such expenses.” (Stats. 1931, ch. 790, § 3, p. 1644.) Prior to this
enactment, there was no statute authorizing the government to recover its fire suppression
or investigation costs.
In 1953, the Legislature enacted chapter 48, codifying section 13007 et seq.,
including, in particular, section 13009, which generally appears to replicate the language
of the 1931 enactment. (Stats. 1953, ch. 48, §§ 1-3, p. 682.) As enacted, former section
13009 permitted recovery of “[t]he expenses of fighting any fires mentioned in Sections
13007 and 13008 . . . against any person made liable by those sections for damages
caused by such fires.” (Stats. 1953, ch. 48, § 3, p. 682.) At that time, section 13007
permitted an owner whose property was damaged to recover against “[a]ny person who
personally or through another wilfully, negligently, or in violation of law, sets fire to,
allows fire to be set to, or allows a fire kindled or attended by him to escape to, the
property of another, whether privately or publicly owned . . . .” (Stats. 1953, ch. 48, § 1,
p. 682, italics added.)13 Section 13008 made liable “[a]ny person” who allowed a fire
13 Though section 19, which provides the statutory definition of “person,” had not been
enacted when the initial statute providing for recovery of fire suppression costs came into
effect in 1931, it was enacted prior to this 1953 enactment of former sections 13007,
13008, and 13009. (See Stats. 1939, ch. 60, gen. prov. 19, pp. 483-484, amended by
Stats. 1994, ch 1010, § 151, p. 6095 [adding “limited liability company” to the statutory
definition of “person”].) At that time, it included, as it does today, “corporation” as a
person. (Stats. 1939, ch. 60, gen. prov. 19, p. 484.) The Legislature was presumptively
aware of this when it enacted section 13009 in 1953. (People v. Scott (2014) 58 Cal.4th
23
burning on his property to escape to another’s property “without exercising due diligence
to control such fire.” (Stats. 1953, ch. 48, § 2, p. 682.) Thus, through reference by
incorporation to section 13007, former section 13009 allowed for recovery against a
person who acted “personally or through another.” (Stats. 1953, ch. 48, §§ 1, 3, p. 682.)
Then, in 1971, apparently in reaction to the decision in People v. Williams (1963)
222 Cal.App.2d 152, in which the State was deemed unable to recover its fire suppression
costs against a defendant who set a fire that burned out of control within the boundaries
of his own property, the Legislature amended section 13009. (People v. Southern Pacific
Co. (1983) 139 Cal.App.3d 627, 637 (Southern Pacific).) As amended, former section
13009 read, in pertinent part: “Any person who negligently, or in violation of the law,
sets a fire, allows a fire to be set, or allows a fire kindled or attended by him to escape
onto any forest, range or nonresidential grass-covered land is liable for the expense of
fighting the fire and such expense shall be a charge against that person.” (Stats. 1971,
ch. 1202, § 1, p. 2297.) As relevant to our present inquiry, while the 1971 amendment
addressed the boundary limitation identified in Williams, the amendment also removed
the reference by incorporation to section 13007’s language imposing liability on any
person who acted “personally or through another.” (Compare Stats. 1953, ch. 48, § 1,
p. 682 with Stats. 1971, ch. 1202, § 1, p. 2297.)
None of the subsequent amendments to section 13009 in 1982, 1987, 1992, or
1994 have re-inserted or otherwise incorporated the “personally or through another”
language that would expressly provide for the application of vicarious liability concepts.
(Cf. Stats. 1982, ch. 668, § 1, p. 2738; Stats. 1987, ch. 1127, §1, p. 3846; Stats. 1992, ch.
427, § 91, pp. 1627-1628; Stats. 1994, ch. 444, § 1, pp. 2410-2411.) Neither did the
Legislature include such language in section 13009.1, when it was added in 1984 or
1415, 1424 [ “the Legislature ‘ “is deemed to be aware of statutes and judicial decisions
already in existence, and to have enacted or amended a statute in light thereof.” ’ ”)
24
amended in 1987. (§ 13009.1, added by Stats. 1984, ch. 1445, § 1, pp. 5058-5059, as
amended by Stats. 1987, ch. 1127, § 2, pp. 3846-3847.) Instead, as relevant to our
inquiry, both sections 13009 and 13009.1 persist in imposing liability on “[a]ny person
. . . who negligently, or in violation of the law, sets a fire, allows a fire to be set, or allows
a fire kindled or attended by him or her to escape onto any public or private property
. . . .” (§§ 13009, subd. (a); 13009.1, subd. (a).) In contrast, section 13007 remains as it
was codified in 1953 and still permits liability to be imposed on “[A]ny person who
personally or through another wilfully, negligently, or in violation of law, sets fire to,
allows fire to be set to, or allows a fire kindled or attended by him to escape to, the
property of another . . . .” (§ 13007, italics added.)
Cal Fire argues we should not construe the presence of the “personally or through
another” language in section 13007 and its absence in sections 13009 and 13009.1 as
indicative of any legislative intent to preclude application of vicarious liability concepts
in the latter sections. We disagree. Cal Fire’s claim that the language is surplusage in
section 13007 is unavailing. For, “[i]t is a maxim of statutory interpretation that courts
should give meaning to every word of a statute and should avoid constructions that would
render any word or provision surplusage.” (Tuolumne Jobs & Small Business Alliance v.
Superior Court (2014) 59 Cal.4th 1029, 1038.) Moreover, the presence of the language
in section 13007, a similar statute on a related subject, and its omission from sections
13009 and 13009.1 is significant in ascertaining legislative intent from the statutes’
language. (Alameda Produce, supra, 52 Cal.4th at p. 1108.) Nor do we find it
incongruous that the Legislature may have afforded a longer reach in recovery efforts to
an owner whose property was damaged than it afforded those who expended funds
fighting or investigating the fire. Therefore, based on the plain language of the statute,
when read in the context of the statutory framework as a whole, we conclude the
25
Legislature did not incorporate concepts of vicarious liability into sections 13009 or
13009.1.
We also reject Cal Fire’s contention that other common law theories of direct
liability including negligent supervision, negligent hiring, negligent inspection, negligent
management and use of property, and peculiar risk have been grafted into sections 13009
and 13009.1 through inclusion of the term “negligently.” The adverb “negligently”
carries the connotation that the tortious actor “ ‘failed to comply with a standard of
conduct with which any ordinary reasonable man could and would have complied: a
standard requiring him to take precautions against harm.’ ” (Black’s Law Dict. (10th ed.
2009) p. 1198, col. 2.) Here, “negligently” is an adverb modifying three potential verb
phrases: (1) sets a fire, (2) allows a fire to be set, or (3) allows a fire kindled or attended
by him or her to escape. (§§ 13009, subd. (a), 13009.1, subd. (a).) To read the statute as
permitting liability where a “person” negligently supervised, managed, hired, or
inspected another who set or allowed to be set a fire, is simply too attenuated a
construction to be plausible. Moreover, Cal Fire has not cited for this court any
published case that has imposed liability under such circumstances, and we have not
found any such cases.
The most apropos potential case we encountered was County of Ventura v.
Southern California Edison Co. (1948) 85 Cal.App.2d 529. There, a power company was
found to be liable to the county and fire protection district for costs of fighting a fire that
occurred when a power line came into contact with a telephone line and pole, all of which
were owned by the power company, as a result of the power company’s negligent
construction and maintenance of its lines. (Id. at p. 531.) The power company argued the
statute in effect, which imposed liability for the expense of fighting fires on “[a]ny person
who: (1) [p]ersonally or through another, and (2) [w]ilfully, negligently, or in violation
of law, . . . (1) [s]ets fire to, (2) [a]llows fire to be set to, [or] (3) [a]llows a fire kindled or
26
attended by him to escape to the property . . . of another . . . ,” did not provide a basis for
liability against the power company. (Id. at pp. 531-532, italics added.) The Court of
Appeal disagreed, finding that while liability perhaps could not be found based on the
first prong—sets fire to—without there being some direct act, liability could be premised
based on the second prong—allows fire to be set to—where the allegedly negligent actor
could “be charged with knowledge of the condition of its equipment, [and] took no steps
to prevent the occurrence of fire, which was the reasonably foreseeable consequence of
that condition.” (Southern California Edison, at pp. 532-533.) However, liability in that
case was not based on section 13009 in its present form, but on a former statute that
allowed recovery against a person who acted “personally or through another,” and still
imposed liability not on a third party with some responsibility to supervise or oversee the
actor, but on the actor itself that failed to properly maintain its own equipment that
directly caused the fire. It is, therefore, unavailing to extend liability in this case to
defendant landowners, the property manager (Beaty), or timber purchaser (Sierra
Pacific).
We are not persuaded otherwise by the cases cited by our esteemed colleague in
his dissent or by the cases proffered by Cal Fire. For instance, as the dissent
acknowledges, Haverstick v. Southern Pacific Co. (1934) 1 Cal.App.2d 605, though it
affirms a judgment in favor of the plaintiff landowner for property damage and personal
injuries against the railroad for the negligence of its employees, the opinion does not
make clear or indeed even mention which section of chapter 790 was the basis of the
plaintiff’s claim for damages. (Dis. opn., post, at pp. 2-3.) It is axiomatic that cases are
not authority for propositions not considered therein (Siskiyou County Farm Bureau v.
Department of Fish & Wildlife (2015) 237 Cal.App.4th 411, 437, fn. 11), and here,
because it is not articulated in the opinion, we cannot say whether Haverstick is
interpreting the section of chapter 790 that premised liability on direct actions of a person
27
or actions engaged in personally or through another. People ex rel. Grijalva v. Superior
Court (2008) 159 Cal.App.4th 1072 did not have to address whether there was legal
responsibility for a fire because the real parties in interest admitted responsibility (id. at
p. 1075); indeed, it focused on whether the affirmative defenses of comparative fault or
failure to mitigate damages could be raised against the government in light of its
immunity (id. at pp. 1077-1079). And, People v. Southern Cal. Edison Co. (1976)
56 Cal.App.3d 593, 596 concerned only whether it was error to award a new trial based
on a particular declaration of counsel purporting to establish a claim of juror misconduct,
and whether it was error to instruct the jury on the amount of firefighting expenses
incurred by the State in fighting a particular fire. Southern Pacific, supra,
139 Cal.App.3d 627 involved a fire that started on railroad property and spread to
surrounding property. The pertinent question presented to the court in Southern Pacific
was whether a jury instruction that permitted liability for fire suppression costs based on
the defendant’s failing to extinguish a fire that it was not found to have kindled was
erroneous. (Id. at pp. 636-637.) Southern Pacific concluded that because section 13009
did not incorporate the language of section 13008, the instruction was erroneous.
(Southern Pacific, at p. 638.) It, however, found the error harmless because there was
substantial evidence the fire was likely to have been caused by sparks or particles emitted
by trains. (Id. at pp. 638-639.) In its interpretation of former section 13009, Shpegel-
Dimsey, supra, 198 Cal.App.3d at pages 1019 through 1020 held only that the City could
not recover fire suppression costs because the defendant was not one of the classes of
persons held liable and the City’s property was not one of the classes of property
protected by the statute as it existed at the time of the fire in 1980.
Moreover, subdivisions (a)(2) and (3), added to sections 13009 and 13009.1 in
1987, extended liability for cost recovery to “[a]ny person . . . (2) other than a mortgagee,
who, being in actual possession of a structure, fails or refuses to correct, within the time
28
allotted for correction, despite having the right to do so, a fire hazard prohibited by law,
for which a public agency properly has issued a notice of violation respecting the hazard,
or (3) including a mortgagee, who, having an obligation under other provisions of law to
correct a fire hazard prohibited by law, for which a public agency has properly issued a
notice of violation respecting the hazard, fails or refuses to correct the hazard within the
time allotted for correction, despite having the right to do so . . . .” (Stats. 1987, ch. 1127,
§§ 1-2, pp. 3846-3847.) Were it possible for section 13009 or 13009.1 to be applied to
one who did not through his direct action proximately cause the fire, i.e., to set a fire or
allow it to be set, there would have been no cause to amend the statute to extend liability
to one who has the right and responsibility to cure a noticed fire hazard but fails to do so.
That person, whether he or she is in actual possession as owner, lessor, lessee, mortgagor,
or mortgagee, would have been liable for his or her negligent use and management of the
property under the “allows a fire to be set” prong of subdivision (a)(1) of sections 13009
and 13009.1. We will not read sections 13009 and 13009.1 in such a way as to make
inclusion of subdivisions (a)(2) or (3) of sections 13009 or 13009.1 nugatory. (Harris v.
Superior Court (2011) 53 Cal.4th 170, 188 [we avoid statutory interpretations that
“render part of an enactment nugatory”].)
Therefore, we conclude neither that inclusion of the term “negligently” in sections
13009 and 13009.1 nor that the statutory definition of “person” to include a corporation,
incorporates common law theories of negligence into the statutes. And further that
sections 13009 or 13009.1 do not provide for vicarious liability. Accordingly, the trial
court did not err in awarding judgment on the pleadings to Sierra Pacific, Beaty, and
landowner defendants with regard to Cal Fire’s claims. On remand following our
reversal of the judgment of dismissal premised on the trial court’s July 26, 2013 order
finding plaintiffs failed to establish a prima facie case (see pt. I.A.3., ante, at pp. 18-20),
Cal Fire is barred from pursuing claims against any defendant based on common law
29
theories of negligence that have not been expressly included in sections 13009 or
13009.1. In reality, for reasons discussed in unpublished part II.B.4. of this opinion, post,
we suspect it is unlikely there will be any opportunity on remand for Cal Fire to pursue
claims against any defendant. [END OF FULLY PUBLISHED PT. I.]
II. Challenges to Postjudgment Awards*
Plaintiffs also challenge the trial court’s postjudgment awards, specifically the
orders awarding costs to defendants as prevailing parties and the orders mandating
Cal Fire to pay attorney fees and expert fees and expenses to defendants either as
prevailing party awards or as discovery sanctions. Cal Fire also challenges any order
awarding costs of proof based on disproving denials to requests for admission. We
conclude any order for costs as prevailing parties premised on the Cottle proceeding are
necessarily vacated, and because the trial court did not apportion costs, the order
awarding costs based on the judgment on the pleadings is remanded for further
proceedings. As to discovery sanctions, we conclude it was not error for the trial court to
impose monetary and terminating sanctions, but the manner in which it imposed
monetary sanctions was an abuse of discretion. Therefore, we remand for further
proceedings to determine an appropriate sanction award. However, we conclude it was
error for the trial court to award attorney fees to defendants as prevailing parties against
Cal Fire. Finally, there is no order awarding costs of proof for us to review on appeal.
A. Costs
The trial court entered three separate orders awarding costs. To Beaty and
landowner defendants, the trial court awarded costs in the sum of $583,173.15. To Sierra
Pacific, it entered an award of costs in the sum of $2,852,209.34. And, to defendants
Howell, Bush, and Crismon, the trial court awarded costs in the sum of $417,604.06. The
* See footnote, ante, page 1.
30
trial court did not apportion the costs awards among the multiple plaintiffs but instead
made each plaintiff jointly and severally liable for the entire amount of each costs award.
In light of our reversal of the trial court’s judgment of dismissal premised on its
finding that plaintiffs had failed to establish a prima facie case (the Cottle proceeding), its
postjudgment order awarding costs to defendants as prevailing parties is necessarily
vacated. (Ducoing Management, Inc. v. Superior Court (2015) 234 Cal.App.4th 306, 314
[“A disposition that reverses a judgment automatically vacates the costs award in the
underlying judgment even without an express statement to this effect.”].) However, as
discussed above, the trial court properly awarded judgment on the pleadings to
defendants Sierra Pacific, Beaty, and landowner defendants and against plaintiff Cal Fire.
Therefore, an award of costs to defendants Sierra Pacific, Beaty, and landowner
defendants as prevailing parties against Cal Fire is appropriate. Nonetheless, because the
trial court’s orders awarding costs did not differentiate between costs incurred by
defendants in response to Cal Fire’s action as opposed to other plaintiffs’ actions, we are
unable to ascertain which costs, if any, were properly awarded to Sierra Pacific, Beaty,
and landowner defendants as prevailing parties against Cal Fire. On remand, the trial
court may award statutorily allowable costs to Sierra Pacific, Beaty, and landowner
defendants to the extent these defendants incurred costs defending against Cal Fire’s
action. (Code Civ. Proc., §§ 1032, 1033.5.)
B. Discovery Sanctions
The trial court entered postjudgment discovery sanctions against Cal Fire
including both monetary sanctions totaling $28,765,365.89 and terminating sanctions
based on its finding that Cal Fire had engaged in pervasive and gross discovery abuses.
The trial court awarded to Beaty and landowner defendants the sum of $6,146,901.41
(comprised of attorney fees and expert witness fees), as an alternative to an award of
attorney fees, as a prevailing party. The trial court awarded cumulatively to Howell,
31
Bush, and Crismon, as an alternative to a prevailing party attorney fee award, the sum of
$1,571,741.28 (comprised of attorney fees and expert witness fees adjusted by a lodestar
factor of 1.2). Finally, it awarded to Sierra Pacific sanctions of $21,100,723.20
(comprised of attorney fees and expert witness fees, costs, and expenses adjusted by a
lodestar factor of 1.2), again as an alternative to an attorney fee award.14
On appeal, Cal Fire argues the trial court did not have jurisdiction to impose
terminating sanctions, that the terminating sanctions imposed were improperly punitive
and not factually supported, and that monetary sanctions were improper because the trial
court did not make the requisite findings required by Code of Civil Procedure section
2023.030. We conclude the trial court had jurisdiction to enter terminating and monetary
sanctions and it did not err in imposing terminating sanctions. However, the manner in
which it imposed monetary sanctions was an abuse of discretion.
1. Additional background.
In awarding discovery sanctions, the trial court found that beginning in July 2010
and continuing through 2013, Cal Fire committed multiple acts that amounted to a “gross
abuse” of the Civil Discovery Act. Specifically, the trial court found that Cal Fire
investigator Joshua White engaged in spoliation when he destroyed his field notes; he
also created a false “Origin and Cause Investigation Report” (the Moonlight report), the
false narrative of which was injected in the litigation in July 2010 when Cal Fire provided
the Moonlight report—in lieu of factual statements—in its response to interrogatories;
and White continued the same false narrative by testifying untruthfully at his deposition
14 This amount does not include the award of $650,634 adjusted by a 1.2 lodestar (for a
total of $780,760.80) ordered by the trial court to Sierra Pacific as fees incurred in
making its motion for fees, expenses, and/or sanctions. Thus, though the total amount the
trial court ordered Cal Fire to pay to Sierra Pacific in its order awarding fees, expenses,
and/or sanctions was $21,881,484, the total amount of sanctions and prevailing party
attorney fees awarded was $21,100,723.20.
32
in November 2010. Thus, the trial court concluded monetary sanctions as a result of
discovery abuses began accruing in July 2010 in the form of all defense expenses
incurred from that point forward, including all attorney fees. Moreover, the trial court
concluded, “[a]ll of Defendants’ defense expenses are, in one way or another,
inextricably intertwined with the falsehoods and omissions in the Origin and Cause
[Investigation] Report.”
In addition to monetary sanctions, the trial court found terminating sanctions were
appropriate because “Cal Fire and its counsel engaged in a stratagem of obfuscation that
infected virtually every aspect of discovery in this case.” The trial court noted that the
pattern and practice of obfuscation began during discovery and continued even after the
trial court had entered judgment and found Cal Fire’s “ ‘willful,’ ” “repeated and
egregious” discovery abuses impaired defendants’ rights and “ ‘threatened the integrity of
the judicial process.’ ” The trial court also found that less severe sanctions would be
unworkable and ineffectual because Cal Fire’s discovery abuses had “permeated nearly
every single significant issue in this case.”
The trial court found that “Cal Fire’s actions initiating, maintaining, and
prosecuting this action, to the present time [(postjudgment)], [are] corrupt and tainted.
Cal Fire failed to comply with discovery obligations, and its repeated failure was willful.”
In concluding discovery sanctions were appropriate, the trial court stated, “In the end,
Cal Fire and its counsels’ vast array of discovery abuses suggests that they perceive
themselves as above the rule of law. With their abuses infecting virtually every aspect of
the discovery process, from false testimony, to pervasive false interrogatory responses, to
spoliation of critical evidence, to willful violations of the Court’s Orders requiring
production of WiFITER [(Wildland Fire Investigation Training and Equipment Fund)]
documents, Defendants and the Court simply have no reason to believe that these
Defendants can receive, or could ever have received, a fair trial under these
33
circumstances.” In ordering terminating sanctions, the trial court relied on authority
provided by Code of Civil Procedure section 2023.030 in addition to a separate line of
case law, “as augmented by the inherent powers of the Court,” to issue the “most severe
sanction” to dismiss the case with prejudice because it found Cal Fire “engaged in
misconduct . . . that is deliberate, that is egregious, and that renders any remedy short of
dismissal inadequate to preserve the fairness of the trial.”15
In reaching these conclusions, the trial court highlighted multiple exemplar
discovery abuses it found were committed by Cal Fire.
a. WiFITER fund documents
Cal Fire was ordered by the trial court to produce all responsive documents
relating to the “Wildland Fire Investigation Training and Equipment Fund” (the
WiFITER fund) by April 30, 2013.16 At that time it produced 7,206 responsive
documents amounting to 27,915 pages. During argument of the motions in limine a
couple months later, Cal Fire argued any evidence concerning the WiFITER fund should
be excluded at trial as irrelevant because defendants could not point to anything in the
discovery they had received that demonstrated the WiFITER fund was improper or
15 Contrary to Cal Fire’s claim, we do not believe the trial court’s rulings on discovery
sanctions are an improper decision on the merits of the case depriving Cal Fire of its right
to a jury trial. Rather, the trial court is required to consider the evidence presented to
determine whether a misuse of the discovery process has occurred. Here, the claimed
misuses included false testimony by a witness and false discovery responses. Thus, the
trial court was obliged, upon receiving defendants’ motions for sanctions, to consider and
weigh the evidence presented to it to make a determination on the merits of the claims of
discovery abuse.
16 WiFITER was a fund established without statutory authorization by Cal Fire and
managed by the California District Attorneys Association. The fund, which was
established to promote fire investigations and improve training, collected more than $3.6
million dollars through civil cost recovery negotiated settlements before it was closed in
April of 2013 following a report from the State Auditor.
34
illegal, or that it provided any incentive for Cal Fire to conduct its fire investigations for
any purpose other than to discover the truth. Based on Cal Fire’s representations and
argument, and the evidence known to defendants at that time, the trial court granted
Cal Fire’s motion in limine to exclude any reference to the WiFITER fund.
Then, on October 21, 2013, counsel for Sierra Pacific informed counsel for
Cal Fire that it had learned from an independent source (a State Auditor’s report issued
Oct. 15, 2013) of a responsive document that had not been produced by Cal Fire. As
subsequently ordered by the trial court, on October 31, 2013, Cal Fire produced “a
jumbled mix of documents”—more than 5,000 pages—that ought to have been produced
by the April 30, 2013 deadline. Thereafter, on November 22, 2013, after Cal Fire had
represented to the trial court that it had produced “everything,” Cal Fire produced an
additional 2,000 pages of documentation, in violation of the trial court’s first and second
orders to produce responsive documents.
The Attorney General presented various theories why the documents were not
timely produced, notably, error by Attorney General staff in inadvertently failing to mark
pages for production or in inadvertently skipping clumps of pages in their review or
software errors in marking pages for production during Attorney General staff review.
Nonetheless, the trial court found that Cal Fire’s belated production had violated
discovery rules and had prejudiced defendants in their ability to adequately conduct
depositions, argue, and support or oppose motions, strategize their case, and engage in
settlement negotiations because they were lacking relevant information. The trial court
also found it would have ruled differently on the aforementioned motion in limine if the
information had been disclosed timely and that “some of these [belatedly produced]
documents belie Cal Fire’s own representations to this Court that there was no evidence
whatsoever that the WiFITER fund was improper.” The trial court concluded Cal Fire’s
failure to produce a large volume of relevant documents in violation of the trial court’s
35
repeated orders to do so, even if inadvertent, demonstrated a lack of seriousness on behalf
of Cal Fire in fulfilling its obligation to comply with the discovery rules that amounted to
a gross violation of the rules and an affront to the trial court.
b. Lead investigator’s deposition testimony
The trial court noted there was a “significant dispute between the parties as to
whether the investigators properly met the standard of care associated with wildland fire
origin and cause investigations,” and noted that it was not the trial court’s role in this
context to resolve this dispute. Nonetheless, in the context of determining whether
discovery sanctions should be imposed, the trial court was bound to consider “whether
Cal Fire abused the legal process through the false testimony of its lead investigator on
the Moonlight Fire, Joshua White.” White and the United States Forest Service
investigator, Dave Reynolds, who conducted the joint origin and cause investigation
together, were the primary scene investigators. They began processing the scene on
September 4, 2007, and identified two points of origin the following morning and labeled
those points as E-2 and E-3 in the Moonlight report. When asked why White did not
mark the E-2 or E-3 points with a white flag (which is indicated by the Moonlight report
as a marker for either evidence or a point of origin), take any photographs to document
those sites as points of origin, or otherwise document the “most important points in his
investigation” until three days later, White provided no explanation and merely
responded, “I don’t know.” Neither could Reynolds explain why there were five
photographs, produced in discovery but not attached to the Moonlight report, taken the
morning of September 5, 2007, from two selected reference points that seem to center on
a white flag, or why the only GPS measurement taken was from the rock directly adjacent
to that white flag.
White was able to explain the purpose of the blue, red, and yellow indicator flags
seen in the photographs, but denied even seeing the white flag, which the trial court
36
acknowledged was more readily seen when viewed enlarged on a computer screen. After
being shown the image in that manner, White retracted his assertion that there was no
white flag but continued to profess ignorance of how the flag came to be there. He
persisted in denying that he placed the flag, could not explain why it was there, and also
maintained he was unaware that Reynolds had placed any white flag for any reason.
Neither White nor Reynolds recalled placing any white flags to mark evidence or points
of origin, though Reynolds posited the white flag was “very likely . . . a flag [he] put
down but . . . discounted . . . later.” Additionally, the trial court found that none of the
photographs omitted from the Moonlight report demonstrates any interest in points E-2
and E-3, which White identified in the report as the points of origin.
White also disavowed knowledge of a “Fire Origin” sketch—prepared by
Reynolds—which depicts the two reference points that coincide with the reference points
of the omitted photographs, and distance and bearing measurements from those reference
points that intersect at a labeled point of origin marked with an “x” in the same location
as the white flag depicted in the omitted photographs, even though photos indicate White
would have at least seen the sketch when he took photographs of metal fragments. In
another matter, White had testified that to locate a point of origin, one would establish
two reference points and take measurements, and that this would be “ ‘the very
foundation of an origin and cause report.’ ” (Italics omitted.) Nonetheless, here White
testified he did not know where the measurements denoted on the sketch intersected,
denied having seen the sketch until after the Moonlight report was complete, and
indicated he did not learn of the sketch until sometime in 2008.
The trial court explained that White’s testimony on the “most central issues” in the
case was not credible, demonstrated Cal Fire’s pattern of obfuscation and bad faith denial
of the truth during discovery, and greatly increased the expense of litigation because
“[h]ad [the investigators] testified truthfully from the start, as required, [fn. omitted]
37
Defendants would have likely spent nothing, or very little, as the case most likely could
not have advanced.” The trial court also castigated Cal Fire’s lead counsel for failing to
intervene to stop its witnesses from testifying untruthfully. Specifically, Reynolds had
discussed whether there was a white flag in a photograph during a meeting with counsel
but later denied seeing the flag in the photo when placed under oath in his deposition.
The trial court was similarly insulted by Cal Fire’s willingness to present a declaration
from White even after the case was dismissed wherein he continued to advance his
“absurd[]” deposition testimony regarding the white flag.
c. Falsification of interview statements
(i) J.W. Bush interview
White and Reynolds interviewed Bush, a Howell employee working on the day the
Moonlight Fire began, on two occasions. The first interview, conducted September 3,
2007, was summarized but was not recorded. The second interview, on September 10,
2007, was both recorded and summarized. The summaries were incorporated into the
Moonlight report, which was provided in lieu of a narrative in discovery responses, and
the tape-recording of the second interview was provided in discovery.
In his summary of the September 3, 2007 Bush interview, Reynolds claims Bush
attributed the cause of the fire to a Caterpillar bulldozer’s tracks scraping rock. However,
in the September 10, 2007 interview, as revealed by a transcript of the interview
recording produced in discovery, when asked whether he ever believed that to be the
cause of the fire, Bush flatly denied having that belief and denied having told anyone that
a rock strike started the fire. Nonetheless, in White’s summary of the September 10,
2007 Bush interview, which was incorporated into the Moonlight report provided as a
discovery response to interrogatories, White indicated “ ‘Bush reiterated the same
information he had provided to . . . Reynolds,’ ” i.e., that the fire was caused by a
bulldozer striking a rock. When White was asked during his deposition about the
38
inconsistency between his summary and the transcript of the recorded interview he
offered no explanation for the discrepancy.
(ii) Ryan Bauer interview
The summary of the interview with Ryan Bauer, who was cutting firewood with
an altered chainsaw in the area near where the Moonlight Fire began, included by White
in the Moonlight report, omits Bauer’s unsolicited, demonstrably false alibi in which he
volunteered, “ ‘I was with my girlfriend all day. She can verify that if I’m being blamed
for the fire.’ ” Rather, the Moonlight report indicates Bauer noticed the fire from his
girlfriend’s house and had gone toward the fire to see if he could assist in removing
equipment. The omission of Bauer’s voluntary statement renders the Moonlight report
misleading with respect to his potential involvement. The Moonlight report was provided
as an interrogatory response in lieu of a particularized response, though the recording of
the interview was produced in discovery. Therefore, the trial court found, “[h]ad
Defendants relied on Cal Fire’s verified interrogator[y] [responses], this information
would never have been discovered.”
(iii) Red Rock lookout interviews
On the day the fire started, Caleb Lief was manning the nearest federal lookout
tower, known as Red Rock. The Moonlight Fire was reported from this tower at 2:24
p.m. At about 2:00 p.m., another federal employee, Karen Juska, went to the tower to
bring supplies and for maintenance. When she walked up the steps to the tower, she
found Lief standing on the catwalk of the tower urinating on his bare feet, supposedly as
a homeopathic cure to athlete’s foot fungus. When she walked into the cabin at the
tower, she spied a glass marijuana pipe, which Lief placed in his back pocket; and, when
he handed her the radio to repair, she smelled a heavy odor of marijuana on Lief’s hand
and on the radio.
39
None of this information, which the trial court deemed relevant to the inquiry
whether Lief was properly performing his function, was contained or referenced in the
written summaries of the interviews of Lief and Juska conducted and prepared by
Reynolds’s replacement, United States Forest Service special agent Diane Welton. The
summaries are incorporated in Cal Fire’s verified interrogatory responses in lieu of
factual statements. The record indicates White learned of Lief’s conduct sometime in
2008, but did not feel he had sufficient information to include it in the Moonlight report.
Additionally, Juska testified Welton instructed her not to speak of these issues prior to
her interview, and her draft report indicated she was asked to omit information because
Lief’s conduct was not being investigated.
d. Spoliation of evidence
White destroyed his field notes prepared during his investigation, a fact which he
attempted to justify because his “ ‘field notes were destroyed only after the information in
them was transferred to his Report [(the Moonlight report)], which was and is the
common practice’ ” and that he “ ‘transferred all of the case file information to his laptop
computer, so all this electronic information [is] in fact preserved.’ ” The trial court
expressly found White not to be a credible witness in this regard. As proof supporting
this finding, the trial court cited White’s failure to record any information in the
Moonlight report regarding placement of the white flag, photographs taken of the white
flag, measurements and a GPS reading of the location of the rock where the white flag
was placed, or the sketch in which the flag location was marked as the point of origin.
Defendants discovered this all happened prior to the release of the scene only through
discovery of Reynolds’s notes from the United States Forest Service.
Additionally, because White had destroyed his copious field notes, the trial court
found he was able to effectively and conveniently escape meaningful cross-examination
because he could claim a lapse of memory when confronted with inconsistencies. White
40
claimed not to remember the white flag, not to remember learning of the marijuana
paraphernalia and odor at the Red Rock lookout, and not to remember why his report of
the September 10 interview with Bush is directly opposite of the transcript of that
interview. The trial court deduced that had the notes not been destroyed, White’s intent
may have been revealed. That Cal Fire has since made it an official practice to destroy
field notes is not helpful to Cal Fire’s position in defending White’s voluntary spoliation
of evidence in the present case.
e. Inclusion of other false origin and cause reports
Incorporated in the Moonlight report was a report about another fire—the Lyman
Fire. The Moonlight report indicated that the investigation of the Lyman Fire revealed
that it too was ignited when a bulldozer operated by a Howell employee struck a rock.
However, the lead investigator of the Lyman Fire flatly contradicted that conclusion by
testifying that the cause of the Lyman Fire was undetermined. The false report about the
Lyman Fire was included in verified interrogatory responses in lieu of narrative factual
statements.
2. Legal Principles.
As noted above, the trial court relied on two separate sources of authority to
impose discovery sanctions on Cal Fire: statutory authority provided by the Civil
Discovery Act and common law authority premised on the court’s inherent authority as
described in Slesinger, supra, 155 Cal.App.4th 736. The trial court appeared to premise
its award of monetary sanctions on the statutory authority alone, but its order imposing
terminating sanctions was based on both sources of its authority. Thus, we discuss both
the common law and statutory authority of the trial court to impose sanctions for
discovery abuses.
Code of Civil Procedure section 2023.030 permits the trial court to impose as
sanctions against anyone who has engaged in a misuse of the discovery process monetary
41
sanctions, issue sanctions, evidence sanctions, terminating sanctions, or contempt
sanctions. Code of Civil Procedure section 2023.010 provides that the following, among
others, are misuses of the discovery process: failing to respond or to submit to an
authorized method of discovery; making, without substantial justification, an
unmeritorious objection to discovery; making an evasive response to discovery; and
disobeying a court order to provide discovery. Other sanctionable discovery abuses
include providing false discovery responses and spoliation of evidence. (Williams v. Russ
(2008) 167 Cal.App.4th 1215, 1223 [terminating sanctions for intentional spoliation of
evidence]; Saxena v. Goffney (2008) 159 Cal.App.4th 316, 333-334 [sanctions for
willfully false discovery responses].)
Under this statutory scheme, the trial court has broad discretion in selecting the
appropriate sanction, and we must uphold the trial court’s determination absent an abuse
of discretion. (Los Defensores, Inc. v. Gomez (2014) 223 Cal.App.4th 377, 390 (Los
Defensores).) Thus, we will reverse the trial court only if it was arbitrary, capricious, or
whimsical in the exercise of that discretion. (Ibid.) As pertinent here, monetary
sanctions, in an amount incurred, including attorney fees, by anyone as a result of the
offending conduct, must be imposed unless the trial court finds the sanctioned party acted
with substantial justification or the sanction is otherwise unjust. (Code Civ. Proc.,
§ 2023.030, subd. (a).) However, terminating sanctions are to be used sparingly because
of the drastic effect of their application. (Lopez v. Watchtower Bible & Tract Society of
New York, Inc. (2016) 246 Cal.App.4th 566, 604 (Lopez); see Newland v. Superior Court
(1995) 40 Cal.App.4th 608, 613-616.) Thus, under the statutory scheme, trial courts
should select sanctions tailored to the harm caused by the misuse of the discovery process
and should not exceed what is required to protect the party harmed by the misuse of the
discovery process. (Lopez, supra, at p. 604.) Therefore, sanctions are generally imposed
in an incremental approach, with terminating sanctions being the last resort. (Ibid.)
42
However, even under the Civil Discovery Act’s incremental approach, the trial court may
impose terminating sanctions as a first measure in extreme cases, or where the record
shows lesser sanctions would be ineffective. (Lopez, at pp. 604-605; see Van Sickle v.
Gilbert (2011) 196 Cal.App.4th 1495, 1516-1519; Miranda v. 21st Century Ins. Co.
(2004) 117 Cal.App.4th 913, 928-929.)
Similarly, there exists a line of case law that authorizes the imposition of
terminating sanctions as a first remedy based on the inherent power of the court in certain
circumstances. In Slesinger, supra, 155 Cal.App.4th 736, a private investigator hired by
the plaintiff entered onto the defendant’s private property and trespassed into the facility
that disposed of the defendant’s confidential and privileged documents, improperly
removed documents from both locations, and provided those documents to the plaintiff.
The plaintiff then repeatedly disavowed knowledge of how it got those documents,
claimed they were not used in the litigation, and failed to produce the documents in
discovery despite appropriate requests for production. (Id. at pp. 741, 744-747, 768.)
Based on this deliberate and egregious wrongdoing and the trial court’s perception that
no other remedy would adequately address the plaintiff’s misconduct, the trial court
exercised its inherent authority to protect the integrity of the judicial process and issued
terminating sanctions against the plaintiff. (Id. at p. 756.) Slesinger upheld the trial
court’s exercise of discretion in imposing terminating sanctions based on the plaintiff’s
conduct, holding that “when a plaintiff’s deliberate and egregious misconduct makes any
sanction other than dismissal inadequate to ensure a fair trial, the trial court has inherent
power to impose a terminating sanction.” (Id. at pp. 740; see id. at pp. 765, 777.)
Under either schema, in reviewing the trial court’s determination, “[w]e defer to
the court’s credibility decisions and draw all reasonable inferences in support of the
court’s ruling.” (Lopez, supra, 246 Cal.App.4th at p. 604.) To the extent the trial court’s
decision to issue sanctions depends on factual determinations, we review the record for
43
substantial evidence to support those determinations. (Los Defensores, supra,
223 Cal.App.4th at p. 390.) Thus, our review “ ‘begins and ends with the determination
as to whether, on the entire record, there is substantial evidence, contradicted or
uncontradicted, which will support the determination [of the trial court].’ ” (Id. at
pp. 390-391.) It is with these principles in mind that we review the trial court’s finding
that Cal Fire willfully misused the discovery process.
3. Monetary sanctions.
We are not persuaded there is substantial evidence to support a finding that
Cal Fire engaged in a misuse of the discovery process by providing an origin and cause
report that did not include information regarding what happened at the Red Rock lookout
tower given the evidence relating to the timing and circumstances of White’s learning
about Lief’s actions and history. Neither are we persuaded that omission of Bauer’s
unsolicited false alibi amounted to a falsehood rendering presentation of the Moonlight
report a misuse of the discovery process, though the omission certainly made the
Moonlight report misleading regarding Bauer’s potential involvement in the fire’s
inception. Nonetheless, there is substantial evidence to support other factual findings
made by the trial court that Cal Fire engaged in discovery abuses.
For example, by repeatedly presenting without limitation the Moonlight report that
contained the false statement by Bush and the false Lyman Fire report as a discovery
response (other than to interrogatories seeking identification of documents relating to
contentions), Cal Fire engaged in sanctionable conduct by providing false discovery
responses, even if it also provided responsive documents that permitted defendants to
uncover the falsehoods and errors in the investigation report. And by White’s providing
untruthful or evasive deposition testimony regarding the white flag and destroying his
field notes regarding the investigation, despite a reasonable expectation of civil litigation,
Cal Fire again misused the discovery process. Finally, by failing to timely provide the
44
responsive WiFITER fund documents pursuant to court order on two separate occasions,
Cal Fire engaged in yet another discovery violation. Thus, even in the absence of the
discovery abuses that the trial court found based on exclusion of information about Lief
and Bauer from the Moonlight report, we cannot conclude it was unreasonable, arbitrary,
or capricious for the trial court to conclude that monetary sanctions were warranted in
light of Cal Fire’s numerous other discovery violations.
That said, we must also consider Cal Fire’s contention that the amount of the
monetary sanction is unreasonable. Monetary sanctions may include “the reasonable
expenses, including attorney’s fees, incurred by anyone as a result of [the] conduct” that
comprises the misuse of the discovery process. (Code Civ. Proc., §2023.030, subd. (a).)
Here, Cal Fire claims the trial court failed to make the requisite finding that the attorney
fees and expert fees and expenses it awarded were incurred as a result of the discovery
abuses, rendering its award of those fees and expenses an abuse of discretion. We agree
the trial court abused its discretion in awarding certain attorney fees and expert fees and
expenses as discovery sanctions. Therefore, we reverse the award of monetary sanctions
and remand the matter for a further hearing.
The trial court entered three orders awarding discovery sanctions to be paid by
Cal Fire. To Sierra Pacific, the trial court awarded $21,881,484, which comprised all of
the attorney fees, expert fees, and other expert expenses it incurred in defending both the
state action and the concurrent federal action since their inception, as adjusted by the 1.2
lodestar multiplier.17 To Howell, Bush, and Crismon, the trial court awarded
$1,571,741.28, which comprised attorney fees dating back to 2009 for defense of liability
issues in the state court case and discovery and other issues in both the state and federal
courts and expert fees to test Cal Fire’s theory regarding how the fire began. And to
17 See footnote 14, ante, page 32.
45
Beaty and landowner defendants, the trial court awarded $6,146,901.41, which comprised
all attorney and expert fees they incurred in both the federal and state court actions.
The trial court reasoned that Cal Fire’s discovery abuses “were the cause of all
defense expenses incurred” after July 3, 2010, and that “[a]ll . . . defense expenses are, in
one way or another, inextricably intertwined with the falsehoods and omissions” in the
Moonlight report. Thus, it did not limit the sanctions to attorney fees or expert fees
incurred after the discovery misuses it found occurred, but awarded attorney fees and
expert fees beginning at the inception of litigation. Defendants offer two authorities for
the proposition that all expenses incurred in litigation may be imposed as sanctions. Both
are inapposite.
In Qualcomm Inc. v. Broadcom Corp. (S.D.Cal., Jan. 7, 2008, No. 05cv1958-B
(BLM)) 2008 U.S.Dist. Lexis 911,18 the district court relied on the Federal Rules of Civil
Procedure and the inherent authority of courts to sanction litigants to prevent abuse of the
judicial process when it awarded the defendant all its attorney fees and costs incurred in
litigation. (2008 U.S.Dist. Lexis 911, pp. *27, *63.) However, neither basis for the
court’s ruling in Qualcomm applies here. Unlike the federal court in Qualcomm, the trial
court here had no inherent power to impose monetary sanctions for misconduct absent
statutory authority. (See Olmstead v. Arthur J. Gallagher & Co. (2004) 32 Cal.4th 804,
809.) Rather, the trial court’s authority to issue discovery sanctions was delineated in
Code of Civil Procedure section 2023.030. Thus, the trial court was limited to awarding
only those “reasonable expenses, including attorney’s fees, incurred by anyone as a result
of” a misuse of the discovery process. (Code Civ. Proc., § 2023.030, subd. (a).)
Therefore, it was an abuse of discretion for the trial court to award sanctions beyond
18 Qualcomm was vacated in part on other grounds as stated in Qualcomm Inc. v.
Broadcom Corp. (S.D.Cal., Apr. 2, 2010, No. 05cv1958-B (BLM)) 2010 U.S.Dist. Lexis
33889.
46
those authorized by section 2023.030, including any attorney or expert fees incurred prior
to Cal Fire’s misuses of the discovery process and any fees that were not the result of
those misuses.
Sherman v. Kinetic Concepts, Inc. (1998) 67 Cal.App.4th 1152 is equally
unavailing. There, the court found it was error for the trial court to deny a motion for
sanctions based on former Code of Civil Procedure section 128.5 and former Code of
Civil Procedure section 2023. (Sherman, supra, at pp. 1163-1164.) Here, no defendant
moved for sanctions pursuant to Code of Civil Procedure section 128.5, which would
permit a trial court to “ ‘order a party . . . to pay the reasonable expenses, including
attorney’s fees, incurred by another party as a result of bad-faith actions or tactics that are
frivolous or solely intended to cause unnecessary delay,’ ” and no order may be issued
based on that section “ ‘except on notice contained in a party’s moving or responding
papers, or [on] the court’s own motion, after notice and opportunity to be heard.’ ”
(Sherman, supra, at p. 1164, quoting former Code Civ. Proc., § 128.5, subds. (a) and (c),
respectively.) And Sherman does not stand for the proposition that monetary discovery
sanctions may be awarded that exceed the statutory authority set forth in Code of Civil
Procedure section 2023.030.
In general, the motions seeking fees as discovery sanctions and accompanying
declarations provide ample evidence of when fees were incurred by defendants but do
little to explain how those fees were incurred as a result of Cal Fire’s discovery abuses.
Therefore, we are unable to ascertain from the record which attorney fees and expert fees
and expenses were incurred as a result of the discovery misuses for which we have
concluded there is substantial evidence in the record to support imposition. However, we
do note, for example, that in their motion for sanctions, Howell, Bush, and Crismon
asserted they incurred $405,586.08 in expert fees to test Cal Fire’s theory that the fire
was caused by a hot metal particle being splintered from a bulldozer track upon a rock
47
strike, including $223,404.26 in expert fees they claim were incurred as a direct result of
Cal Fire’s failure to test its ignition theory prior to issuing the Moonlight report. While
the information obtained as a result of this expert analysis may have been used in the
course of depositions and in reviewing discovery to reveal that the Moonlight report was
deficient or even false, they have not shown that the fees were incurred as a result of
discovery violations engaged in by Cal Fire. Accordingly, we reverse the trial court’s
award of monetary discovery sanctions and remand this matter to the trial court to
conduct a hearing to determine the “reasonable expenses, including attorney’s fees,
incurred by [defendants] as a result of” Cal Fire’s misuses of the discovery process.
(Code Civ. Proc., § 128.5, subd. (a).)
4. Terminating sanctions.
a. Jurisdiction to impose postjudgment
As noted above, after judgment was entered, the trial court considered defendants’
motions for discovery sanctions against Cal Fire, and granted the motions by imposing
both monetary and terminating sanctions against Cal Fire. Cal Fire does not dispute the
trial court’s jurisdictional capacity to award monetary sanctions but argues the trial court
lacked jurisdiction to impose a terminating sanction postjudgment, claiming the latter
sanction is a second judgment violating the one final judgment rule. We disagree.
Generally speaking, “ ‘there can be only one final judgment in a single action.’ ”
(Cuevas v. Truline Corp. (2004) 118 Cal.App.4th 56, 60.) And, an order of dismissal
constitutes a judgment if it is in writing, signed by the court, and filed in the action.
(Code Civ. Proc., § 581d; Etheridge v. Reins Internat. California, Inc. (2009)
172 Cal.App.4th 908, 913.) Thus, when the trial court entered its order dismissing the
actions based on its grant of the motion for judgment on the pleadings and its
determination that plaintiffs had failed to present a prima facie case, as discussed earlier
in our opinion, the trial court entered judgment in this action (case No. C074879). If, as
48
Cal Fire contends, the trial court’s order imposing terminating sanctions is also a
judgment, this subsequent order would be jurisdictionally problematic. (See Code Civ.
Proc., § 916, subd. (a) [“[T]he perfecting of an appeal stays proceedings in the trial court
upon the judgment or order appealed from or upon the matters embraced therein or
affected thereby, including enforcement of the judgment or order, but the trial court may
proceed upon any other matter embraced in the action and not affected by the judgment
or order.”].)
Here, postjudgment and after an appeal of the judgment was perfected (case
No. C074879), the trial court elected to “impose[] terminating sanctions” on Cal Fire and
ordered that “[t]erminating sanctions shall issue against Cal Fire.” Contrary to Cal Fire’s
assertion, this order is not a judgment. The order does not purport to dismiss the action
nor otherwise equate with rendition of judgment. (See Good v. Miller (2013)
214 Cal.App.4th 472, 475.) In fact, generally, this is not even a separately appealable
order. (Code Civ. Proc., § 904.1; but see Nickell v. Matlock (2012) 206 Cal.App.4th 934,
940 [“An order granting terminating sanctions is not appealable, and the losing party
must await the entry of the order of dismissal or judgment unless the terminating order is
inextricably intertwined with another, appealable order.”].) Rather, the trial court’s order
awarding terminating sanctions has no effect at all unless and until the trial court enters a
judgment of dismissal or other order effectuating its award of terminating sanctions. The
trial court may enter such a judgment as to remaining defendants—i.e., not Sierra Pacific,
Beaty, or landowner defendants in whose favor judgment of dismissal was entered
pursuant to an award of judgment on the pleadings as discussed in part I.B., ante—
following remand in case No. C074879 pursuant to our reversal of the judgment of
dismissal premised on the trial court’s July 26, 2013 order finding plaintiffs failed to
establish a prima facie case.
49
Moreover, this postjudgment proceeding is collateral to the appeal because it is
based on Cal Fire’s alleged prejudgment discovery abuses, for which sanctions
proceedings could have occurred regardless of the outcome of the appeal of the judgment.
(See Gridley v. Gridley (2008) 166 Cal.App.4th 1562, 1587; see also Day v. Collingwood
(2006) 144 Cal.App.4th 1116, 1124-1125.) Indeed, though motions concerning
discovery are generally to be heard no less than 15 days before the date initially set for
trial (Code Civ. Proc., § 2024.020, subd. (a)), the Civil Discovery Act does not on its face
limit the ability of the trial court to impose sanctions for violation of its provisions to
prejudgment motions for sanctions. If we were to construe the Civil Discovery Act as
being so limited, it would permit the absurd situation in which those who have misused
the discovery process can avoid penalty if they are able to keep their misuse secret until
after that deadline passes. Neither can we construe the Civil Discovery Act as allowing
only monetary sanctions postjudgment, as Cal Fire argues. If the trial court were
prevented from exercising its discretion in this collateral postjudgment proceeding to
impose whatever sanction it deems appropriate, the effect could prejudice the party
seeking sanctions and cause an undue waste of judicial resources. For, if, as here, the
underlying judgment of dismissal is reversed and remanded (as here), issues and evidence
that would have been excluded or a case that should be the subject of terminating
sanctions would have to be litigated simply because the discovery misuse came to the
trial court’s attention postjudgment. We are not persuaded the Civil Discovery Act
should be construed to allow such a result. Therefore, the trial court had jurisdiction to
impose terminating sanctions.
b. Propriety of order imposing terminating sanctions
As discussed in part II.B.2., ante, terminating sanctions are authorized both by the
Civil Discovery Act and by common law. Here, the trial court relied on both Code of
Civil Procedure section 2023.030 and its inherent authority when it imposed terminating
sanctions against Cal Fire. The trial court found that Cal Fire’s “ ‘willful,’ ” “repeated
50
and egregious” misuses of the discovery process “permeated nearly every single
significant issue in this case” to an extent that “ ‘threatened the integrity of the judicial
process’ ” and made it implausible that defendants could ever receive a fair trial. The
trial court further stated that “Cal Fire’s actions in initiating, maintaining, and prosecuting
this action, to the present time [(postjudgment)] [are] corrupt and tainted. Cal Fire failed
to comply with discovery obligations, and its repeated failure was willful. . . . Cal Fire’s
conduct reeked of bad faith. . . . [C]al Fire failed to comply with discovery orders and
directives, destroyed critical evidence, failed to produce documents it should have
produced months earlier, and engaged in a systematic campaign of misdirection with the
purpose of recovering money from Defendants.” It also found that less severe sanctions
would be unworkable and ineffectual, which certainly implies that it considered imposing
monetary, issue, and evidentiary sanctions and found them insufficient.
As discussed above, there is substantial evidence to support the trial court’s
finding that Cal Fire: (1) failed to comply with discovery orders to produce several
thousand pages of the WiFITER fund documents on two separate occasions, and that the
failure to comply, even if not deliberate, evinced a disregard for the discovery process;
(2) repeatedly presented false, misleading, or evasive discovery responses by
presenting—without limiting comment—the Moonlight report as a responsive document
even though it contained a statement of causation falsely attributed to Bush and a Lyman
Fire report falsely attributing fault to Howell; (3) presented false or evasive deposition
testimony by White; and (4) engaged in spoliation when White improperly destroyed his
field notes despite probable civil litigation. There is also certainly evidence in the record
to suggest that the existence of the WiFITER fund caused investigators to have a motive
for bias in their investigation of wildfires that may result in a civil cost recovery; that
Cal Fire mislead the trial court about what would be contained in the WiFITER fund
documents that were not timely produced thereby causing exclusion of the WiFITER
51
fund documents from trial; and that the Moonlight report excluded information that
probably should have been included or investigated, including Bauer’s unsolicited alibi,
Lief’s questionable conduct, and any reference to or explanation for the white flag. In
view of this cumulative evidence, we cannot find the trial court abused its discretion in
imposing terminating sanctions based on its finding Cal Fire engaged in egregious and
deliberate misconduct that made any other sanction inadequate to protect the judicial
process and to ensure a fair trial.
C. Attorney Fees
Defendants moved for attorney fees as prevailing parties (1) on a contractual basis,
pursuant to Health and Safety Code sections 13009 and 13009.1, Civil Code section
1717, and Code of Civil Procedure section 1021.8, and (2) because the action resulted in
the enforcement of important rights affecting the public interest, pursuant to Code of
Civil Procedure section 1021.5 and Serrano v. Priest (1977) 20 Cal.3d 25, 46-47. The
trial court agreed that defendants were entitled to attorney fees as prevailing parties on
both bases. Cal Fire contends the trial court erred in awarding attorney fees on either
basis. We conclude there is no contractual basis for attorney fees in the instant matter,
and the trial court abused its discretion in awarding attorney fees based on Code of Civil
Procedure section 1021.5.
Before we begin our analysis of the merits of the trial court’s orders awarding
attorney fees to defendants as prevailing parties, we must address some basic issues
appearing on the face of those orders. The trial court awarded to Sierra Pacific
$21,100,723.20 in attorney fees, expert fees, expert expenses, and expert costs as
prevailing party to be recovered exclusively from Cal Fire. However, of this amount,
only $17,088,753.60 may even potentially be recovered as attorney fees on the bases
presented. (See Civ. Code, § 1717 [providing for award of attorney fees to prevailing
party in an action on a contract]; see also Olson v. Automobile Club of Southern
52
California (2008) 42 Cal.4th 1142, 1148 [Code Civ. Proc., § 1021.5 authorizes recovery
of attorney fees, not expert witness fees or expenses].)19 Additionally, of the cumulative
amount of $6,146,901.41 in attorney fees and expert fees the trial court collectively
awarded to Beaty and landowner defendants, only $4,837,720.50 in attorney fees
awarded in the order have the potential of being awarded on these bases. The trial court
collectively awarded to Howell, Bush, and Crismon as prevailing parties attorney fees of
$1,166,155; however, Howell, Bush, and Crismon are not prevailing parties as to any
plaintiff in light of the conclusions we reach in part I., ante. The attorney fee award to
those three defendants is necessarily vacated.
1. No contractual basis.
One of the bases on which the trial court purportedly relied in awarding attorney
fees to the prevailing defendants was Civil Code section 1717, which provides that where
a contract “specifically provides” for recovery of attorney fees and costs following an
action to enforce a contract, the trial court may award reasonable attorney fees to the
prevailing party. Here, however, there is no contract “specifically provid[ing]” for
recovery of attorney fees. Rather, the trial court relied on language in sections 13009 and
13009.1, which provide in relevant part that the charge for fire suppression costs, rescue
or emergency medical service costs constitute “a debt of that person [found liable under
sections 13009 or 13009.1], and is collectible by the person, or by the federal, state,
county, public, or private agency, incurring those costs in the same manner as in the case
of an obligation under a contract, expressed or implied” (§§ 13009, subd. (a) & 13009.1,
subd. (e), italics added), combined with Code of Civil Procedure section 1021.8, which
provides that when the Attorney General prevails in a civil action based on sections
19 We note also that the trial court awarded expert fees as part of its costs award to Sierra
Pacific, despite the absence of any Code of Civil Procedure section 998 offer in the
record. That costs award has been reversed and remanded, as discussed in part I., ante.
53
13009 and 13009.1, inter alia, the Attorney General is to be awarded his or her “costs of
investigating and prosecuting the action, including expert fees, reasonable attorney[]
fees, and costs” (Code Civ. Proc., § 1021.8, subd. (a), italics added). We conclude these
statutes, even when taken together, do not support a finding that there was a contractual
basis for awarding attorney fees to defendants.
Contrary to the necessarily implied assertion of defendants that sections 13009 and
13009.1 create a contract between the parties, “the instant statutes only specify that the
listed costs [recoverable under the statutes] are debts deemed collectible by the state ‘in
the same manner’ as contract obligations. Such language does not transform the liability
into a contract . . . .” (Department of Forestry & Fire Protection v. LeBrock (2002)
96 Cal.App.4th 1137, 1141-1142.) “The statutory language regarding how the state may
collect the costs listed is merely a procedural mechanism. There is no contract between
the parties that expressly, or even impliedly, provides for recovery of attorneys fees.”
(Id. at p. 1142.) Neither is the statutory mandate that the Attorney General recover his or
her attorney fees in a case premised on Health and Safety Code sections 13009 or
13009.1, as codified in Code of Civil Procedure section 1021.8, cause to construe
sections 13009 and 13009.1 as otherwise forming a contractual basis on which to recover
fees. Rather, as with a great many other statutory provisions providing for recovery of
attorney fees, Code of Civil Procedure section 1021.8 is a unilateral statutory basis for
fee recovery. (LeBrock, supra, at p. 1142 [“[M]any statutory provisions which . . .
provide for attorney[] fees are one-sided. They expressly shift fees to advance public
interests, such as encouraging citizens to put fire safety measures in place.”].) Therefore,
as a statutory rather than contractual authorization for fee recovery, it does not trigger the
reciprocity provisions of Civil Code section 1717. (LeBrock, supra, at pp. 1141-1142.)
Accordingly, we conclude the trial court erred in awarding attorney fees to
defendants as prevailing parties on a contractual basis pursuant to Health and Safety
54
Code sections 13009 and 13009.1, Civil Code section 1717, and Code of Civil Procedure
section 1021.8.
2. Public benefit.
The other statutory basis on which the trial court purportedly awarded attorney
fees was that codified in Code of Civil Procedure section 1021.5, which states in part that
“[u]pon motion, a court may award attorneys’ fees to a successful party against one or
more opposing parties in any action which has resulted in the enforcement of an
important right affecting the public interest if: (a) a significant benefit, whether
pecuniary or nonpecuniary, has been conferred on the general public or a large class of
persons, (b) the necessity and financial burden of private enforcement . . . are such as to
make the award appropriate, and (c) such fees should not in the interest of justice be paid
out of the recovery, if any.” On appeal, Cal Fire contends the trial court erred in
awarding attorney fees on this basis because (1) it improperly weighed the public benefit
against the benefit defendants received rather than weighing the financial burden incurred
by defendants against their potential exposure, and (2) the judgment did not confer a
public benefit. We conclude the trial court abused its discretion in awarding attorney fees
on this basis because it failed to consider the comparative financial burden and exposure
defendants faced in litigation as required by Code of Civil Procedure section 1021.5.
“[T]he necessity and financial burden requirement [of Code of Civil Procedure
section 1021.5] ‘ “really examines two issues: whether private enforcement was
necessary and whether the financial burden of private enforcement warrants subsidizing
the successful party’s attorneys.” ’ [Citations.] The ‘necessity’ of private enforcement
‘ “ ‘ “looks to the adequacy of public enforcement and seeks economic equalization of
representation in cases where private enforcement is necessary.” ’ ” ’ ” (Conservatorship
of Whitley (2010) 50 Cal.4th 1206, 1214-1215.) In determining the financial burden on
litigants for purposes of the second prong of this inquiry, “courts have quite logically
55
focused not only on the costs of the litigation but also any offsetting financial benefits
that the litigation yields or reasonably could have been expected to yield. ‘ “An award on
the ‘private attorney general’ theory is appropriate when the cost of the claimant’s legal
victory transcends his personal interest, that is, when the necessity for pursuing the
lawsuit placed a burden on the plaintiff ‘out of proportion to his individual stake in the
matter.’ ” ’ ” (Id. at p. 1215.) Where, however, the party “had a ‘personal financial
stake’ in the litigation ‘sufficient to warrant [the] decision to incur significant attorney
fees and costs in the vigorous prosecution [or defense]’ of the lawsuit, an award under
[Code of Civil Procedure] section 1021.5 is inappropriate.” (Millview County Water
Dist. v. State Water Resources Control Bd. (2016) 4 Cal.App.5th 759, 768-769.)
Here, there is no indication the trial court considered defendants’ litigation costs or
potential financial benefits or burdens defendants would realize through litigation.
Rather, the trial court went on at length to justify its finding that defendants conferred a
significant public benefit in the course of their defense of the action by exposing and
leading to the closure of the WiFITER fund, by prevailing on a summary adjudication in
which the trial court interpreted a regulation (Cal. Code Regs., tit. 14, § 938.8) as not
creating a legal duty on landowners for fires caused by third parties, and by exposing
dishonesty, investigative corruption, and a pervasive violation of discovery rules by a
public entity. The trial court found that “motivation due to some personal interest, which
all defendants must undeniably have, is not fatal to an award of fees under [Code of Civil
Procedure] section 1021.5.” The trial court continued, stating that “[t]he question this
Court must answer is whether the broad public benefits conferred by the Moonlight Fire
litigation were simply coincidental to the defense of the case. While the Court is aware
that any successful defense benefits the defendant, it also finds that the benefits conferred
upon the citizens of California went far beyond the stake these Defendants had in
defending themselves and were not merely coincidental in nature.”
56
The trial court did not in any way discuss or appear to weigh the financial burden
defendants incurred in pursuing their defense of the litigation or any potential financial
exposure defendants faced in the litigation, and there does not appear to have been any
effort on the part of defendants to present evidence in their motions for fees, expenses,
and sanctions to permit the trial court to engage in such an inquiry. Additionally, it does
not appear that if the court had engaged in such an inquiry, it could reasonably have
found defendants’ costs in pursuing their legal victory transcended their personal interest
in avoiding liability to warrant an award of attorney fees pursuant to Code of Civil
Procedure section 1021.5. For, even though the attorney fees, expert fees, and other costs
incurred by defendants here are substantial, so too was the potential liability defendants
faced in the litigation. For instance, we know Cal Fire sought to recover from defendants
fire suppression, investigation, accounting, and administrative costs in the amount of
$8,441,309.99. Additionally, if Cal Fire prevailed, defendants would also have been
liable to the Attorney General for what would amount undoubtedly to several million
dollars for “all costs of investigating and prosecuting the action, including expert fees,
reasonable attorney’s fees, and costs.” (Code Civ. Proc., § 1021.8, subd. (a).) Moreover,
although there was no evidence presented on the issue, there is some indication other
plaintiffs sought damages in the tens of millions of dollars. All told, the financial
exposure defendants faced was decidedly not out of proportion with the financial burden
they incurred in defending the action. Therefore, the trial court erred in awarding
attorney fees to defendants as prevailing parties on this basis as well.
D. Costs of Proof Award
Defendants moved for attorney fees pursuant to Code of Civil Procedure section
2033.420, subdivision (a) because Cal Fire failed to admit the truth of certain matters in
response to propounded requests for admission. On appeal, Cal Fire contends the trial
court erred in awarding attorney fees for defendants because “defendants did not, and
could not, disprove the truthfulness of Cal Fire’s responses to the requests for admission
57
at issue.” We do not reach the merits of this contention because, despite the trial court’s
apparent finding that defendants were entitled to these costs of proof, it did not actually
make any separate award of costs of proof pursuant to Code of Civil Procedure section
2033.420. Thus, Cal Fire has failed to demonstrate any error on the face of the record for
this court to review with regard to an order awarding costs of proof pursuant to Code of
Civil Procedure section 2033.420 because it has not shown there is any such award. (See
Gonzalez v. Rebollo (2014) 226 Cal.App.4th 969, 976.)
III. Challenges to Judge*
Finally, plaintiffs request that we require any remand proceedings be conducted by
a different trial judge. We are obligated to consider this request by Code of Civil
Procedure section 170.1, subdivision (c), which states: “At the request of a party . . . an
appellate court shall consider whether in the interests of justice it should direct that
further proceedings be heard before a trial judge other than the judge whose judgment or
order was reviewed by the appellate court.”
Here, plaintiffs claim the request should be granted because “[a] person aware of
the facts might reasonably entertain a doubt that the judge would be able to be impartial.”
(Code Civ. Proc., § 170.1, subd. (a)(6)(A)(iii).) The facts, as plaintiffs see them, are that
Judge Nichols deprived them, without a legitimate reason, of a trial on the same law and
evidence that a judge who had previously heard law and motion proceedings and another
court in a separate but related federal case had deemed sufficient to proceed to trial.
Additionally, plaintiffs assert there is a reasonable doubt Judge Nichols would be
impartial after reversal, especially because the procedures employed here were unfair,
and because Judge Nichols is a visiting retired judge forced to hear a lengthy trial in a
remote and rural location.
* See footnote, ante, page 1.
58
Our review of the record does not reveal any evidence of prejudice or bias on the
part of Judge Nichols that would warrant his disqualification on remand. And erroneous
rulings are not themselves sufficient evidence of bias to warrant removal. (Blakemore v.
Superior Court (2005) 129 Cal.App.4th 36, 59-60.) Accordingly, we conclude the
interests of justice do not warrant any order from this court requiring that future trial
court proceedings be conducted by a different judge.
DISPOSITION
In case No. C074879, the judgment of dismissal as to Cal Fire’s claims against
Beaty, Sierra Pacific, and landowner defendants is affirmed. The judgment of dismissal
as to all other claims is reversed, and the matter is remanded to the trial court for further
proceedings.
In case No. C076008, the postjudgment award of costs to defendants Sierra
Pacific, Beaty, and landowner defendants as prevailing parties against Cal Fire is
remanded for further proceedings to calculate an appropriate award for costs incurred in
defending Cal Fire’s action pursuant to Code of Civil Procedure sections 1032 and
1033.5. All other postjudgment orders awarding costs to prevailing parties are
necessarily vacated as a result of our conclusion in case No. C074879. The postjudgment
award of attorney fees to defendants Howell, Bush, and Crismon is also necessarily
vacated, as they are no longer prevailing parties as to any plaintiff. Additionally, we
reverse the postjudgment awards of attorney fees to defendants Sierra Pacific, Beaty, and
the landowner defendants as prevailing parties against Cal Fire. We also reverse the
postjudgment order imposing monetary discovery sanctions against Cal Fire and remand
for further proceedings to determine the recoverable expenses pursuant to Code of Civil
Procedure section 2023.030. The postjudgment order imposing terminating sanctions
against Cal Fire is affirmed.
59
Plaintiffs and appellants, other than Cal Fire, are entitled to their costs on appeal in
case No. C074879. (Cal. Rules of Court, rule 8.278(a)(1), (2).) All parties are
responsible for their own costs in case No. C076008. (Id., rule 8.278(a)(5).)
BUTZ , J.
I concur:
NICHOLSON , Acting P. J.
60
ROBIE, J.
I respectfully dissent.
First, the majority finds that the trial court’s decision to grant judgment on the
pleadings to Sierra Pacific, Beaty, and landowner defendants was proper because Health
and Safety Code sections 13009 and 13009.11 do not incorporate common law theories of
negligence, including vicarious liability, to hold anyone besides a direct actor liable for
the cost of that fire’s suppression. I cannot agree.
As the majority notes, section 13009 states in relevant part, “[a]ny person (1) who
negligently, or in violation of the law, sets a fire, allows a fire to be set, or allows a fire
kindled or attended by him or her to escape onto any public or private property . . . is
liable for the fire suppression costs incurred in fighting the fire and for the cost of
providing rescue or emergency medical services, and those costs shall be a charge against
that person.” Section 13009.1 repeats the basic language of section 13009 concerning
who may be held liable for the cost of fire suppression. Further, section 19 of the same
code defines a person as “any person, firm, association, organization, partnership,
business trust, corporation, limited liability company, or company.” A plain reading of
these statutes appears to extend liability for the cost of fire suppression to corporations or
companies through vicarious liability. “Any person” as used in sections 13009 and
13009.1 includes companies and corporations (see § 19); these entities can only act
through their agents and thus can only be found negligent through vicarious liability.
(Snukal v. Flightways Manufacturing, Inc. (2000) 23 Cal.4th 754, 782 [“ ‘corporations
necessarily act through agents’ ”].) To read otherwise would ignore the definition of
“person” contained in the Health and Safety Code. Thus, sections 13009 and 13009.1
can be read to impose liability for the costs of fire suppression through vicarious liability.
1 Further section references are to the Health and Safety Code.
1
I believe the statutory history supports this interpretation. As my colleagues note,
chapter 790, enacted in 1931, imposed liability for the cost of property damage to “Any
person who: [¶] (1) Personally or through another, and [¶] (2) Wilfully, negligently, or
in violation of law, commits any of the following acts: [¶] (1) Sets fire to, [¶]
(2) Allows fire to be set to, [¶] (3) Allows a fire kindled or attended by him to escape to
the property, whether privately or public owned, of another.” (Stats. 1931, ch. 790, § 1,
p. 1644, italics added.) This language appears to mirror modern day section 13007.
Chapter 790, section 2, imposes liability for cost of property damage to “Any person who
allows any fire burning upon his property to escape to the property, whether privately or
publicly owned, of another, without exercising due diligence to control such fire.” (Stats.
1931, ch. 790, § 2, p. 1644, italics added.) This language appears to mirror modern day
section 13008. Importantly, section 2 omits the language “[p]ersonally or through
another” that is found in the first section of chapter 790.
Three years after the enactment of chapter 790, this court in Haverstick v.
Southern Pac. Co. (1934) 1 Cal.App.2d 605, found sufficient evidence to hold the
“Southern Pacific Company (a Corporation)” liable to a landowner after a train operated
by Southern Pacific caught fire during a run from Galt to Ione and, through the lack of
“ordinary care and diligence” of Southern Pacific’s employees, the fire was allowed to
spread from Southern Pacific’s property to the landowner’s property. There was “[n]o
real explanation” for how the fire started. (Id. at pp. 605, 607, 610.) Although the
opinion does not specify whether the railroad’s liability was predicated upon section 2,
this appears to be so because the employees of the railroad did not kindle or set any fire,
but merely allowed fire burning on the railroad’s property to spread to the property of
another through a lack of due diligence. (Compare Stats. 1931, ch. 790, §§ 1 and 2; see
also People v. Southern Pacific Co. (1983) 139 Cal.App.3d 627, 636-638 [under
§§ 13007 and 13009, a jury must find a defendant negligently started or kindled a fire,
not merely negligently failed to extinguish it].) Because liability was likely predicated
2
pursuant to section 2 (Stats. 1931, ch. 790), the railroad was found vicariously liable
based on the language “[a]ny person” and not the additional language of “[p]ersonally or
through another” found in section 1.
In 1939, the Health and Safety Code was enacted and included section 19, which
defined a person as “any person, firm, association, organization, partnership, business
trust, corporation, or company.” (Stat. 1939, ch. 60, p. 484, § 19.) The code did not
include a section devoted to fire protection. Then in 1953, chapter 790 was codified into
the Health and Safety Code and sections 13007, 13008, and 13009 were enacted, each
reflecting the language used in chapter 790 sections 1 through 3 respectively. (Stats.
1953, ch. 48, p. 682, §§ 1-3.) Section 13009, explicitly referenced sections 13007 and
13008 and allowed for the collection of fire suppression costs when someone was
responsible for a fire as described by those sections. Then, after People v. Williams
(1963) 22 Cal.App.2d 152, it appears the Legislature rewrote section 13009 (not merely
transferred the language from a prior chapter) to allow for liability in the situation where
a fire does not escape to another’s property. During the rewrite, the Legislature removed
references to section 13007 and 13008; however, this time it had the benefit of the
definition of “person” within the same code as the fire prevention statutes and
Haverstick’s finding of liability upon a corporation through the acts of its employees.
Thus, when the Legislature wrote “any person” without the language “who personally or
through another,” it still intended to extend liability to those who must act vicariously
through their agents.
The majority concludes that such an interpretation would render the language
“who personally or through another” in section 13007 meaningless. However, the
interpretation the majority gives to section 13009, renders the definition of “person”
meaningless and would result in corporations or companies never being held liable for
fire suppression costs. This is highlighted by the example given in the majority opinion.
The opinion distinguishes County of Ventura v. So. Cal. Edison Co. (1948) 85
3
Cal.App.2d 529, from the present case because it was decided before section 13009
removed reference to section 13007 and because liability was imposed “not on a third
party with some responsibility to supervise or oversee the actor, but on the actor itself
that failed to properly maintain its own equipment that directly caused the fire.” While
the first reason distinguishing the case is sound, I do not see how Southern California
Edison Co. is a direct actor. “The trial court found the cause of the fire to be the
negligent construction and maintenance of the transmission and telephone lines by the
Edison Company.” (Ventura County v. So. Cal. Edison Co., supra, 85 Cal.App.2d at
p. 531.) As a corporation, the Edison Company cannot act. (See Snukal v. Flightways
Manufacturing, Inc., supra, 23 Cal.4th at p. 782.) Its agents/employees can act by
constructing and maintaining or by imposing policies for the adequate construction and
maintenance of company equipment. It was the employees’ failure to act in such a way
that led to the vicarious liability of the Edison Company. I do not see a meaningful
difference between the negligence of a company when the cause of a fire was an
employee’s overt act versus the same employee’s failure to act.
Cases brought under section 13009 involving companies or organizations further
highlight this point. In People ex rel. Grijalva v. Superior Court (2008) 159 Cal.App.4th
1072, 1075-1076, a water conservation district admitted liability after a complaint was
filed for breach of contract, negligence, negligence per se, and public nuisance, when “[a]
spark from construction equipment operated by an employee of [the water conservation
district] started a brush fire.” Although liability was admitted, the start of this fire is
nearly identical to the start of the Moonlight Fire here (spark from equipment operated by
an employee), but because it is phrased as a failure to act by the organization, which
resulted in a public nuisance, the majority opinion would deem it properly brought.
Also in People v. Southern Pacific Co., supra, 139 Cal.App.3d at pages 632, 636
through 640, the court found a jury instruction harmless and the verdict holding Southern
Pacific liable for fire suppression costs proper when a spark from a train started a fire.
4
The negligence theory relied upon was “negligent maintenance or operation of the fire
extinguisher, and . . . failure to clear combustible vegetation from the right-of-way in the
area where the fire started.” (People v. Southern Pacific Co., supra, 139 Cal.App.3d at
p. 633, italics added.) As in People ex rel. Grijalva, the theory of negligence can be
stated as an overt act of an employee and as a failure of that employee to act in some way
that then caused the fire. On this note, whether a company’s negligence proximately
caused the fire is still a question left to the fact finder and could serve to negate liability
for fire suppression where an employee’s acts do not comport with company policy and
cannot be said to be a product of the company’s negligence.
Finally, I do not believe a reading of section 13009 that includes vicarious liability
renders subdivision (a)(2) and (a)(3) of that section meaningless. The majority states that
“[w]ere it possible for section 13009 and 13009.1 to be applied to one who did not
through his direct action proximately cause the fire . . . there would have been no cause to
amend the statute to extend liability to one who has the right and responsibility to cure a
noticed fire hazard but fails to do so.” Not so. Four years before the amendment of
section 13009 in 1987, People v. Southern Pacific Co., supra, 139 Cal.App.3d at pages
636 through 637, held it error to instruct the jury that it could find liability under section
13009 solely on a theory that the defendant negligently failed to extinguish a fire, without
finding the defendant was negligently responsible for kindling a fire. The court
“conclude[d] that liability for firefighting expenses under section 13009 is limited to the
situations in which liability for property damage exists under section 13007” and that a
defendant must be found to have been responsible through its negligent conduct to have
started or kindled the fire. (People v. Southern Pacific Co., supra, 139 Cal.App.3d at
p. 638.) Section 13009, subdivision (a)(2) and (a)(3) allow for liability upon a showing
that a fire occurred on the property and someone with the right to correct a fire hazard
failed to do so when notified. This subdivision does not require a showing that the
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conduct of failing to maintain the property actually kindled the fire or that the fire
originated on the property in question.
This interpretation is supported by City of Los Angeles v. Shpegel-Dimsey, Inc.
(1988) 198 Cal.App.3d 1009. There, a court found a company was not liable under the
pre-1987 version of section 13009 for fire suppression costs despite the company being
notified 55 times of fire code violations. (City of Los Angeles, at p. 1015.) Although the
company was in violation of the fire code, the chemicals it stored were not spontaneously
combustible and the fire that ignited on the property was alleged only to have grown
because of the company’s negligence, not to have started because of negligence. (Id. at
pp. 1015-1016.) Thus, the company fell “within none of the classes of persons held
liable” under section 13009. (City of Los Angeles, at pp. 1019-1020.) The court noted
that the amendment to section 13009 would have made the company unequivocally liable
for fire suppression costs because it failed to correct a fire hazard prohibited by law.
(City of Los Angeles, at p. 1019, fn. 2.)
For these reasons, I believe sections 13009 and 13009.1 can be read to hold
companies vicariously liable for the acts of their employees. I cannot agree with my
colleagues’ conclusion to the contrary.
With this interpretation of the statute and the resulting denial of the motion for
judgment on the pleadings, I too would reverse the award of costs to defendants, but in its
entirety, not just for the reasons the majority finds the court’s ruling infirm.
Further, I believe, the trial judge was not fair and impartial in much of the
proceedings, and it is clear to me that he became embroiled and acted impulsively and
thus erred in many other ways. For example, I agree with the majority’s conclusion to
reverse for fundamental due process reasons the Cottle2 ruling of the trial court.
2 Cottle v. Superior Court (1992) 3 Cal.App.4th 1367.
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However, this sua sponte action by the trial court demonstrates how profoundly biased
the trial judge was.
In this same vein, I cannot agree to affirm the terminating sanctions imposed for
discovery abuses. The number of documents to be produced was enormous. Therefore,
late production of 7,000 pages, while not minor, must be considered in context.
Terminating sanctions are to be a last resort “and should be used sparingly,” after lesser
sanctions are not sufficient. (Lopez v. Watchtower Bible & Tract Society of New York,
Inc. (2016) 246 Cal.App.4th 566, 604.) “A trial court must be cautious when imposing a
terminating sanction because the sanction eliminates a party’s fundamental right to a trial,
thus implicating due process rights.” (Ibid.) There is no indication the trial court
imposed intermediate sanctions. After all, he could have refused admission of certain
evidence which was the subject of abuse. Or he could have deemed as admitted facts that
were the subject of late discovery. He also could have imposed monetary sanctions as an
intermediate remedy. But, just as the trial court acted impulsively in ruling on an oral
motion for judgment on the pleadings and in abruptly raising on its own motion and
imposing the Cottle remedy one week before trial, the trial court impulsively granted
terminating sanctions.
Not only did the trial court fail to consider incremental sanctions, the court also
failed to justify why those incremental sanctions would not have been effective. My
colleagues also fail to justify why incremental sanctions for the discovery violations
would not have been effective. Indeed, judgment on the pleadings and dismissal had
already been entered in favor of a majority of defendants, thus making terminating
sanctions at this stage of the proceedings overkill and not “required to protect the
interests of the party entitled to but denied discovery.” (Lopez v. Watchtower Bible &
Tract Society of New York, Inc., supra, 246 Cal.App.4th at p. 604.) “The trial court
should select a sanction that is ‘ “ ‘tailor[ed] . . . to the harm caused by the withheld
discovery.’ ” ’ ” (Ibid.) Here, terminating sanctions were not tailored to the harm caused
7
by the withheld discovery because the case had already been resolved as to a majority of
the defendants at the time the court imposed the terminating sanctions.
Further, I do not believe that terminating sanctions were justified by CalFire’s
conduct. The majority finds, and I agree, that substantial evidence did not support a
finding of misuse of discovery practices where the Ryan Bauer interview and the Red
Rock lookout interviews were concerned. Despite this finding, however, the majority
opinion cites these two instances as justification for terminating sanctions. Further,
neither the trial court nor the majority opinion found CalFire deliberately withheld
thousands of WiFITER documents, and merely conclude that CalFire’s conduct “evinced
a disregard for the discovery process.” The terminating sanctions appear to rest on this
nonwillful conduct and Investigator White’s willful conduct of preparing a misleading
report, giving false deposition testimony, and destroying his field notes. Where the
destruction of the field notes is concerned, however, it should be noted that law
enforcement officers routinely destroy their notes once they have prepared a report and
that it was White’s routine practice to do so, in addition to being CalFire’s official
practice at the time of the hearing. I do not see White’s destruction of his notes as rising
to the level of intentional spoliation. Thus, the only conduct left that evinced a deliberate
misuse of the discovery process was White’s misleading report and false deposition
testimony. Surely, a lesser sanction could have been structured to deal with this one
person’s conduct. (See Lopez v. Watchtower Bible & Tract Society of New York, Inc.,
supra, 246 Cal.App.4th at pp. 604-606 [terminating sanctions not proper when party
willfully withheld documents because record did not reflect that court could not have
obtained compliance with lesser sanctions].)
Finally, I also cannot agree that any remand be before the same trial judge, who I
believe was manifestly biased and did not provide a fair and impartial forum for litigation
of an enormously important case with vast ramifications beyond the facts of this
proceeding. The conduct of the trial court in making the Cottle ruling, granting judgment
8
on the pleadings and then issuing postjudgment terminating sanctions were not the
actions of a fair and impartial judge.
/s/ ,
Robie, J.
9
Filed 12/8/17
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Plumas)
----
DEPARTMENT OF FORESTRY AND FIRE C074879, C076008
PROTECTION et al.,
(Super. Ct. Nos.
Plaintiffs and Appellants, CV09-00205 (lead),
CV09-00231, CV09-00245,
v. CV10-00255, CV10-00264)
EUNICE E. HOWELL et al., ORDER CERTIFYING OPINION
FOR PUBLICATION
Defendants and Respondents.
[NO CHANGE IN JUDGMENT]
THE COURT:
The opinion in the above-entitled matter filed on December 6, 2017, was certified for
partial publication in the Official Reports. For good cause it now appears that the opinion should
be published in full in the Official Reports and it is so ordered. There is no change in judgment.
FOR THE COURT:
NICHOLSON , Acting P. J.
ROBIE , J.
BUTZ , J.
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