Opinion
A155656
06-26-2020
NYNA ARMSTRONG, Appellant, v. THOMAS E. DALY, Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Contra Costa County Super. Ct. No. D15-05048)
Appellant Nyna Armstrong petitioned for dissolution of marriage against respondent Thomas E. Daly, and a few months later, the trial court dismissed the petition finding there was no valid marriage between Armstrong and Daly.
Daly then moved for monetary sanctions against Armstrong's attorney under former Code of Civil Procedure section 128.5, arguing the dissolution petition was frivolous and had been filed for the sole purpose of causing unnecessary delay in Daly's unlawful detainer action against Armstrong. Without reaching the merits, the trial court denied the motion, relying on Daly's failure to comply with the safe harbor provision found in section 128.7.
The applicable version of the statute provides in relevant part, "A trial court may order a party, the party's attorney, or both, 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." (Former § 128.5, as amended by Stats. 2014, ch. 425.) Further undesignated statutory references are to the Code of Civil Procedure.
In a prior unpublished decision, we held that former section 128.5 did not incorporate by reference the safe harbor provision of section 128.7, and we reversed and remanded to the trial court to consider the merits of Daly's sanctions motion. (Armstrong v. Daly (Oct. 24, 2017, A148771) [nonpub. opn.] (Armstrong I).) On remand, the trial court granted Daly's motion, ordering Armstrong's attorney to pay sanctions in the amount of $23,352.68.
Armstrong appeals. She contends intervening case authority and legislative history establish that former section 128.5 does include a safe harbor provision. She also argues the sanctions order should be reversed on the grounds the trial judge who dismissed the dissolution petition should have heard the sanctions motion on remand and the written ruling is deficient.
We will reverse.
DISCUSSION
A. Former Section 128.5 Includes a Safe Harbor Provision
As mentioned, we previously interpreted former section 128.5 as not including the safe harbor provision found in section 128.7. In reaching our conclusion, we followed San Diegans for Open Government v. City of San Diego (2016) 247 Cal.App.4th 1306, 1317 (San Diegans), a decision from Division One of the Fourth District Court of Appeal.
However, "[t]he Legislature responded to San Diegans with 'urgency legislation enacted August 7, 2017 (Stats. 2017, ch. 169, § 1) . . . "to clarify the previous legislative intent." (Assem. Com. on Judiciary, Analysis of Assem. Bill No. 984 (2017-2018 Reg. Sess.) [(AB 984)] as amended Apr. 20, 2017, p. 1, italics omitted.)' " (In re Marriage of Sahafzadeh-Taeb & Taeb (2019) 39 Cal.App.5th 124, 134, quoting Nutrition Distribution, LLC v. Southern SARMs, Inc. (2018) 20 Cal.App.5th 117, 129 (Nutrition Distribution).) Among other things, AB 984 amended section 128.5 "to [expressly] import (with minor language modifications) the conditions and procedures contained in [section 128.7], including . . . a 21-day safe harbor provision." (Nutrition Distribution, at p. 129.) And since Armstrong I was filed, appellate courts have uniformly held, contrary to San Diegans, that former section 128.5 does require compliance with the safe harbor provision of section 128.7. (E.g., Nutrition Distribution, supra, 20 Cal.App.5th at p. 130; CPF Vaseo Associates, LLC v. Gray (2018) 29 Cal.App.5th 997, 1005 (CPF).)
AB 984 went into effect on August 7, 2017, and we noted in Armstrong I that the amended law did not apply to Daly's sanctions motion. (Armstrong I, supra, fn. 9.) The parties, however, did not address how AB 984 affected the statutory construction of former section 128.5 in their appellate briefs, likely because the briefing concluded before AB 984 went into effect. Armstrong I was filed in October 2017. No party filed a petition for rehearing.
In Nutrition Distribution, the court relied on the plain language of former section 128.5, the legislative history of the law, and the legislative history of AB 984. (Nutrition Distribution, supra, 20 Cal.App.5th at pp. 126-129.) Regarding the import of AB 984, the Nutrition Distribution court explained: "The legislative reports accompanying this amendment confirm the Legislature's intent to include a safe harbor provision in former [section 128.5]. [Citations.] [¶] Discussing the need for the amendment to former [section 128.5], the analysis of Assembly Bill No. 984 prepared for the Assembly Committee on Judiciary explained that the committee had adopted several amendments to . . . section 128.5 'to ensure that Section 128.5 would be "read in harmony with the salutary cognate provisions of section 128.7." ' (Assem. Com. on Judiciary, Analysis of Assem. Bill No. 984, supra, as amended Apr. 20, 2017 p. 8.) The 2017 amendment, the report continued, 'seeks to clarify the intent behind the enactment of [former section 128.5] . . . and abrogate several of the holdings under San Diegans [for Open Government].' (Ibid.; see id. at p. 7 [interpretation of former subd. (f) by San Diegans for Open Government 'is inconsistent with [its] legislative history']; Sen. Judiciary, Rep. on Assem. Bill No. 984 (2017-2018 Reg. Sess.), as amended June 19, 2017, p. 3. ['Since AB 2494 [which enacted former section 128.5] took effect, courts have interpreted provisions of Section 128.5 inconsistently and, at times, at odds with the intent of the Legislature. This bill seeks to address the apparent confusion in the courts and make the provisions of Section 128.5 completely clear.'].)" (Nutrition Distribution at pp. 129-130, fn. omitted.)
Following Nutrition Distribution, Division One of the Fourth District rejected its own prior holding in San Diegans. (CPF, supra, 29 Cal.App.5th at p. 1005.) The CPF court explained: "In light of the legislative history of—and especially the significance of the subsequent clarifying amendment to—section 128.5 [i.e., AB 984], we find Nutrition Distribution persuasive. Of course, the decision to reach a legal conclusion that differs from an opinion by another panel of this court is not one we make lightly. (See San Diegans for Open Government, supra, 247 Cal.App.4th 1306.) Indeed, sound institutional principles of stare decisis encourage us to follow existing precedent, and those principles apply, if anything, more strongly to past decisions of this court. But the fundamental issue here is one of legislative intent, and the clarity of the Legislature's action on this topic provides compelling reason to depart from our general practice." (CPF at p. 1005.)
AB 984, Nutrition Distribution, and CPF convince us that former section 128.5 does include a safe harbor provision, and, therefore, our contrary holding in Armstrong I is incorrect. B. Law of the Case Does Not Preclude Reconsideration of the Issue
Daly responds, however, that we are precluded from revisiting our holding in Armstrong I under the law of the case.
"The rule of 'law of the case' generally precludes multiple appellate review of the same issue in a single case." (Searle v. Allstate Life Ins. Co. (1985) 38 Cal.3d 425, 434 (Searle).) "Where an appellate court states in its opinion a principle or rule of law necessary to its decision, that principle or rule becomes the law of the case. [Citation.] The law of the case must be adhered to both in the lower court and upon subsequent appeal. [Citation.] This is true even if the court that issued the opinion becomes convinced in a subsequent consideration that the former opinion is erroneous." (Santa Clarita Organization for Planning the Environment v. County of Los Angeles (2007) 157 Cal.App.4th 149, 156.)
But "the doctrine of law of the case which has been recognized as being harsh is merely a rule of procedure and does not go to the power of the court. It will not be adhered to where its application will result in an unjust decision. [Citations.] The principal ground for making an exception to the doctrine of law of the case is an intervening or contemporaneous change in the law." (Clemente v. State of California (1985) 40 Cal.3d 202, 212.)
" 'Where there are exceptional circumstances, a court which is looking to a just determination of the rights of the parties to the litigation and not merely to rules of practice, may and should decide the case without regard to what has gone before.' [Citation.] But '[i]n the absence of exceptional circumstances of hardship and injustice the need for attributing finality to considered judicial determinations compels adherence to the previous decision.' [Citation.] Though we have recognized that the rule will be disregarded when necessary to avoid an 'unjust decision' [citation], that exception must rest on 'a manifest misapplication of existing principles resulting in substantial injustice' and not on mere disagreement with the prior appellate determination." (Searle, supra, 38 Cal.3d at p. 435.)
In this case, San Diegans, the case we relied on in Armstrong I, has been repudiated by the Legislature and rejected by appellate courts, including the very court that decided San Diegans. Indeed, the Legislature's wholesale rejection of San Diegans in AB 984 prompted Division One of our court to hold that "no vestige remains of the holdings in San Diegans." (In re Marriage of Sahafzadeh-Taeb & Taeb, supra, 39 Cal.App.5th at p. 128.) We believe these circumstances are exceptional and warrant departure from the doctrine of the law of the case. In declining to follow San Diegans despite "sound institutional principles of stare decisis," Division One of the Fourth District reasoned, "the fundamental issue here is one of legislative intent, and the clarity of the Legislature's action on this topic provides compelling reason to depart from our general practice." (CPF, supra, 29 Cal.App.5th at p. 1005.) Likewise, we believe the clarity of the Legislature's action provides an exceptional circumstance warranting departure from the doctrine of the law of the case.
And there is another reason not to apply the law of the case here. "The primary purpose served by the law-of-the-case rule is one of judicial economy." (Searle, supra, 38 Cal.3d at p. 435.) The finality of an initial appellate ruling under the law of the case avoids the possibility of subsequent "reversal and proceedings on remand that would result if the initial ruling were not adhered to in a later appellate proceeding." (Ibid.) But "[t]hat reason for the rule is inoperative when the court hearing the subsequent appeal determines that there should be a reversal on a ground that was not considered on the prior appeal. The fact that reversal is necessary in any event frees us from the compulsion that the rule of law of the case might otherwise impose on us to follow a ruling in the prior appeal that we now perceive to be manifestly erroneous." (Ibid.) Reversal is necessary here, as we will explain. C. The Trial Judge on the Dissolution Petition Should Have Decided the Sanctions Motion
Aside from the issue whether former section 128.5 includes a safe harbor provision, we conclude there should be a reversal in this case because the judge who granted sanctions was not the judge who presided over the trial and observed the allegedly sanctionable conduct.
Honorable Leslie Landau presided over the trial on whether Armstrong and Daly were married under the common law of South Carolina and ruled there was no marriage, and then heard Daly's original motion for sanctions. On remand from Armstrong I, however, the sanctions motion was assigned to a different judge without further briefing or argument.
We note that Judge Landau was still a trial court judge at the time of remand. The record indicates she was sitting in juvenile court when this matter was remanded.
Armstrong asserts it was error that Judge Landau did not decide the sanctions motion on remand because the ruling required a finding of subjective bad faith. (See In re Marriage of Sahafzadeh-Taeb & Taeb, supra, 39 Cal.App.5th at p. 128 [sanctions under section 128.5 require subjective bad faith].) We agree. Judge Landau observed the trial on marital status, and at the initial hearing on sanctions after the conclusion of the trial, she observed Armstrong's attorney as he offered his legal justification for bringing the dissolution petition and explained his conduct in litigation. She was obviously in the best position to determine whether the attorney was acting in subjective bad faith. (See Burkle v. Burkle (2006) 144 Cal.App.4th 387, 401 ["No doubt there are cases where the judge in whose court the sanctionable conduct occurred is the only appropriate judicial officer to award sanctions. . . . [T]his would be so only when it is necessary for the judge awarding sanctions to make a subjective finding of bad faith to justify the sanctions order" (italics added)]; Orange County Dept. of Child Support Services v. Superior Court (2005) 129 Cal.App.4th 798, 805-806 (Orange County) [vacating sanctions order where sanctioning judge "improperly drew conclusions about [sanctioned attorney]'s state of mind . . . without having been present at the contempt proceedings [which led to the sanctions]"; the commissioner who heard the contempt proceeding "was in a much better position . . . to decide whether [the attorney]'s conduct was sanctionable" having heard the evidence and observed the attorneys].)
Armstrong further argues that the written ruling in this case was deficient because it neither identified the particular conduct found to be sanctionable nor made a finding of the requisite subjective bad faith. In light of our conclusion that the sanctions motion in this matter must be heard by the judge who observed the allegedly sanctionable conduct, we need not address this argument. We are concerned, however, that the judge's ruling contains only a description of the reasons Judge Landau gave for dismissing the dissolution petition, but it does not identify the action or tactic by Armstrong's attorney found to have been taken in bad faith. (Cf. Jansen Associates, Inc. v. Codercard, Inc. (1990) 218 Cal.App.3d 1166, 1171 [reversing sanctions order that made no direct reference to the attorney's conduct].)
Accordingly, we reverse the sanctions order and remand with directions that, in the event Daly continues to pursue sanctions under section 128.5, the motion be heard by Judge Landau. (See Orange County, supra, 129 Cal.App.4th at p. 808 [granting writ petition and remanding with instructions that the sanctions request be heard by the commissioner who presided over the allegedly sanctionable conduct].)
We are not suggesting that the matter be pursued. We note that Daly does not claim on appeal that he ever complied with the safe harbor provision of section 128.7, and nothing in the record suggests he did so. While Daly did request "sanctions pursuant to CCP Section 128.5" in his response to the dissolution petition, this reference to section 128.5 sanctions would not constitute compliance with the safe harbor provision, which requires service of a notice of motion. (§ 128.7, subd. (c); see CPF, supra, 29 Cal.App.5th at p. 1007 [safe harbor provision cannot be satisfied by "substantial compliance"; strict compliance serves the safe harbor provision's remedial purpose].)
But having determined the sanctions order should be reversed, we are free "from the compulsion that the rule of law of the case might otherwise impose on us to follow a ruling in the prior appeal that we now perceive to be manifestly erroneous." (Searle, supra, 38 Cal.3d at p. 435.) We have already determined that departure from the law of the case is warranted in this case, and our reversal on a separate ground provides another reason we are not bound by Armstrong I.
DISPOSITION
The order granting sanctions is reversed and the matter is remanded for further proceedings consistent with this opinion. The parties shall bear their own costs on appeal.
/s/_________
Miller, J. WE CONCUR: /s/_________
Kline, P.J. /s/_________
Stewart, J.