Opinion
A146950
01-27-2022
ELIZABETH KARNAZES, Plaintiff and Appellant, v. ALBERT W. LEE et al., Defendants and Respondents.
NOT TO BE PUBLISHED
San Francisco County Super. Ct. No. CGC-12-521174
TUCHER, J.
Plaintiff Elizabeth Karnazes appeals orders granting the motion of defendants Albert W. Lee and John Hartford to quash service of summons and denying Karnazes's motion for leave under Civil Code section 1714.10 to file an amended complaint. We affirm both orders.
All undesignated statutory references are to the Civil Code.
FACTUAL AND PROCEDURAL BACKGROUND
This case arises from a lawsuit in the San Mateo County Superior Court in which Karnazes and Hartford were opponents. (Karnazes v. Hartford, San Mateo County Super. Ct. No. CIV458258 (the San Mateo action).) Our colleagues in Division Two of this court have entertained multiple appeals arising out of the San Mateo action and the resulting award of costs and attorney fees to Hartford, a case with a history our colleagues have described as "Dickensian." (Karnazes v. Hartford (Jan. 26, 2018, A143858) [nonpub. opn.]; see Karnazes v. Hartford (Feb. 10, 2014, A136400) [nonpub. opn.]; Karnazes v. Hartford (June 27, 2014, A139421) [nonpub. opn.]; Karnazes v. Hartford (April 28, 2017, A143423) [nonpub. opn.]; Karnazes v. Hartford (July 31, 2019, A145672) [nonpub. opn.].)
Karnazes filed the current action in the San Francisco Superior Court on May 29, 2012. As pertinent here, she alleged Hartford and Lee, Hartford's attorney, told her that if she filed a request for dismissal without prejudice in the San Mateo action, the matter would be settled with a" 'mutual walk-away'" between Karnazes and Hartford, there would be no prevailing party, and the parties would bear their own attorneys' fees and costs. Relying on their representations, Karnazes filed a request for dismissal, but they nevertheless sought and obtained costs and attorneys' fees, "deceiving and misleading the court" that the matter had not been settled. As a result, Karnazes alleged, she suffered "mental, emotional, and physical distress" and financial loss, and she was subjected to awards of attorney fees and costs in the San Mateo action. It appears she did not serve defendants with the original complaint in the current action.
In 2015 Karnazes sought leave to file a first amended complaint that, on the same facts, alleges 10 causes of action against Hartford and Lee for fraud, and additionally alleges other intentional torts in causes of action 11 through 14. Stating they were appearing specially, Hartford and Lee opposed the motion on the grounds that (1) the case was barred by collateral estoppel because the court in the San Mateo action had rejected Karnazes's claim that they were not entitled to costs and fees because they had violated a settlement agreement with her and (2) the litigation privilege (§ 47) barred her claims. As a result, Defendants argued, Karnazes did not have a reasonable probability of prevailing in the current action and she was not entitled to a filing order under section 1714.10, which requires a court order before an action may be filed against an attorney for conspiracy with his or her client arising from an attempt to contest or compromise a dispute. (§ 1714.10, subd. (a).)
Also in 2015, Lee and Hartford, appearing specially, moved to quash service of the summons and first amended complaint on two grounds: that the summons was not signed by the clerk or issued under the clerk's seal as required by Code of Civil Procedure section 412.20, subdivision (a), and that the complaint required a section 1714.10 filing order. The motion attached copies of a summons that lacked the clerk's signature or the court's seal, which had been purportedly served on Hartford and Lee. The clerk's transcript contains a proof of service on Hartford of the summons and amended petition, signed by the person who served the papers and filed by Karnazes.
At the hearing on the two motions, Karnazes acknowledged that the court clerk had not stamped the summons. On November 19, 2015, the trial court granted Defendants' motion to quash on the independent grounds that the summons was invalid because it had not been signed by the clerk and that Karnazes had failed to obtain a section 1714.10 filing order.
The court denied without prejudice Karnazes's petition to file an amended complaint, finding the first through tenth causes of action were barred by collateral estoppel and there was therefore no reasonable probability Karnazes would prevail on them. The court explained that the denial was without prejudice because, although the eleventh through fourteenth causes of action were based partly on the alleged settlement agreement, they also raised claims that Defendants filed improper liens against Karnazes's home.
Karnazes timely appealed from these orders.
DISCUSSION
I. Motion to Quash
California law provides that, "[e]xcept as otherwise required by statute, a summons shall be directed to the defendant, signed by the clerk and issued under the seal of the court in which the action is pending . . ." (Code Civ. Proc., § 412.20, subd. (a), italics added.) In the absence of voluntary submission to the court's authority, "compliance with the statutory procedures for service of process is essential to establish personal jurisdiction." (Dill v. Berquist Construction Co. (1994) 24 Cal.App.4th 1426, 1439, 1444.) A defendant may bring a motion to quash service on the ground the court lacks jurisdiction. (Code Civ. Proc., § 418.10, subd. (a)(1).) Filing such a motion does not constitute a general appearance in the action. (Id., subd. (d).)
It is undisputed that the summons on the first amended complaint purportedly served on Defendants was neither signed by the clerk of the court nor issued under the court's seal as required by statute and, indeed, the proposed first amended complaint had not been filed. Service of summons was therefore ineffective, and the trial court properly quashed service.
Without reasoned argument or citation to either evidence in the record or relevant authority, Karnazes suggests Defendants made a general appearance in this action by requesting ex parte relief before the hearing and unspecified other relief that the court can grant only if it has jurisdiction over them. We treat this unsupported assertion as forfeited and do not consider it. (See Okasaki v. City of Elk Grove (2012) 203 Cal.App.4th 1043, 1045, fn. 1; Allen v. City of Sacramento (2015) 234 Cal.App.4th 41, 52; Del Real v. City of Riverside (2002) 95 Cal.App.4th 761, 768 (Del Real).) For the same reason, we treat as forfeited any challenge Karnazes seeks to make to the trial court's failure to sustain her objection to Lee's exhibits and to the denial of a continuance of the hearing.
II. Denial of Leave to File First Amended Complaint
Section 1714.10 provides in part, "No cause of action against an attorney for a civil conspiracy with his or her client arising from any attempt to contest or compromise a claim or dispute, and which is based upon the attorney's representation of the client, shall be included in a complaint or other pleading unless the court enters an order allowing the pleading that includes the claim for civil conspiracy to be filed after the court determines that the party seeking to file the pleading has established that there is a reasonable probability that the party will prevail in the action." (§ 1714.10, subd. (a).)
In making this determination, the trial court does not weigh conflicting evidence, determine credibility, or draw inferences; rather, it performs a" 'gatekeeping' function, filtering out frivolous allegations of conspiracy." (Burtscher v. Burtscher (1994) 26 Cal.App.4th 720, 726.) If the plaintiff "has presented a sufficient pleading and has presented evidence showing that a prima facie case will be established at trial, the trial court must grant the petition." (Hung v. Wang (1992) 8 Cal.App.4th 908, 933-934.) This is a question of law subject to de novo review on appeal. (Id. at p. 931; see Schroeder v. Irvine City Council (2002) 97 Cal.App.4th 174, 184.) We affirm the trial court's ruling if it is correct upon any applicable legal theory. (People v. Brown (2004) 33 Cal.4th 892, 901.)
There is no real dispute that section 1714.10 applies to this action: Karnazes acknowledges her proposed complaint includes claims against Defendants for conspiracy, she makes claims against Lee for his actions as Hartford's attorney in the San Mateo action, and the gravamen of those claims is that Hartford and Lee acted deceptively in connection with settlement negotiations.
Defendants asserted two grounds for their position that Karnazes had no reasonable probability of success: that the action is barred by collateral estoppel and that it is barred by the litigation privilege. The trial court concluded Karnazes's first through tenth causes of action are barred by collateral estoppel because they are premised on the allegation that she formed a settlement agreement with Defendants in the San Mateo action and they breached that agreement, and these issues were litigated and determined against her in that action. The record shows that in opposition to Hartford's motion for costs in the San Mateo action, Karnazes raised the claim that Hartford and Lee were violating the settlement agreement, Hartford responded with a declaration denying he reached a settlement with Karnazes, and the trial court granted Hartford's motion for costs. Karnazes's purported appeal from this order was dismissed as untimely.
Collateral estoppel, which precludes relitigation of issues decided in prior proceedings, applies if the issues in the former and current litigation are identical, the issue was actually litigated, it was necessarily decided in the prior proceeding, the decision in the former proceeding is final and on the merits, and the party against whom preclusion is sought is the same as, or in privity with, the party to the former proceeding. (Hernandez v. City of Pomona (2009) 46 Cal.4th 501, 511.) Karnazes contends this doctrine does not apply here because she did not have a full opportunity to litigate the existence of a settlement agreement in the San Mateo action. She relies upon Rohrbasser v. Lederer (1986) 179 Cal.App.3d 290, which explained that "a judgment procured by extrinsic fraud or mistake may be attacked either by a motion in the same action or by an independent action in a court having equity jurisdiction, and . . . each remedy is distinct and cumulative." (Id. at p. 297.) The test for the application of collateral estoppel is "whether the person attacking the judgment made a detailed presentation of the issues of fraud or mistake on his motion to vacate, or was given a full opportunity at the time of the hearing to develop the issues by oral testimony. Otherwise, . . . denial of the motion is not res judicata of the issues and the subsequent independent equitable action can be maintained." (Id. at p. 298; see In re Marriage of Grissom (1994) 30 Cal.App.4th 40, 46 [where legal judgment was obtained through extrinsic fraud by which party was denied opportunity to be heard, party may bring equitable action to set it aside].)
We are not persuaded the principle upon which Karnazes relies applies here. She is not invoking the court's equity jurisdiction to set aside a judgment, obtained by fraud, which she lacked the opportunity to contest; rather, she is seeking damages for being ordered to pay costs in the San Mateo action, an order the court made after she raised her argument that Defendants violated the settlement agreement and, the record indicates, submitted a supporting declaration. She asserts the court in the San Mateo action did not allow her an evidentiary hearing to present testimony and other evidence, but does not support this assertion by any citation to the record. (See Del Real, supra, 95 Cal.App.4th at p. 768 [any point lacking citation to record may be deemed waived].) This record does not appear to show she was denied the opportunity to present her claim fully.
In any case, we need not decide finally whether collateral estoppel bars the applicable causes of action, because the litigation privilege provides an independent basis to uphold the trial court's ruling. Under section 47, a statement made in a judicial proceeding is privileged. (§ 47, subd. (b).) The privilege applies to any communication made by litigants to achieve the objects of the litigation that have some connection or logical relation to the action. (Silberg v. Anderson (1990) 50 Cal.3d 205, 212; accord, Rusheen v. Cohen (2006) 37 Cal.4th 1048, 1057 [" 'communications with "some relation" to judicial proceedings'" are immune from tort liability]; Hewlett-Packard Co. v. Oracle Corp. (2021) 65 Cal.App.5th 506, 570.) The privilege is not limited to statements inside a courtroom, but includes statements made by counsel during settlement negotiations. (Home Ins. Co. v. Zurich Ins. Co. (2002) 96 Cal.App.4th 17, 24 (Home Ins. Co.); Navarro v. IHOP Properties, Inc. (2005) 134 Cal.App.4th 834, 843 (Navarro).) Although this privilege does not apply to an equitable action to set aside a settlement agreement for extrinsic fraud, it bars a direct action for fraud committed in a judicial proceeding. (Heyman v. Franchise Mortgage Acceptance Corp. (2003) 107 Cal.App.4th 921, 925, fn. 2 (Heyman); Navarro, supra, 134 Cal.App.4th at p. 844 [litigation privilege"' "bars derivative tort actions and 'applies to all torts other than malicious prosecution, including fraud, negligence and negligent misrepresentation'"' "]; Home Ins. Co., at p. 26; Rubenstein v. Rubenstein (2000) 81 Cal.App.4th 1131, 1147.) Where it is applicable, the "litigation privilege is absolute," in furtherance of the policy of "enhancing the finality of judgments and avoiding unending postjudgment derivative litigation." (Herterich v. Peltner (2018) 20 Cal.App.5th 1132, 1142.)
The allegations of the first ten causes of action fall squarely within the litigation privilege. Each of them is based on the claim that Hartford and Lee deceived Karnazes into believing they had agreed to settle the San Mateo action with a" 'mutual walk-away'" that would lead to no award of attorney fees and costs. These statements allegedly made during settlement negotiations are privileged. (Navarro, supra, 134 Cal.App.4th at pp. 843- 844; Home Ins. Co., supra, 96 Cal.App.4th at p. 26.) Because there is no reasonable probability Karnazes will prevail on these claims, the trial court properly denied Karnazes's motion under section 1714.10.
Karnazes also asks for leave to file a second amended complaint. We need not consider this request because the trial court's order denying leave to file the first amended complaint was made without prejudice to her right to seek to file a further amended complaint.
DISPOSITION
The November 19, 2015 orders are affirmed. Defendants shall recover their costs on appeal.
WE CONCUR: POLLAK, P. J. BROWN, J.