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Jones v. Whitchurch

Court of Appeals of California, Fourth District, Division Three.
Nov 13, 2003
G031270 (Cal. Ct. App. Nov. 13, 2003)

Opinion

G031270.

11-13-2003

WILLIE T. JONES et al., Plaintiffs and Appellants, v. GIALISA WHITCHURCH, Defendant and Respondent.

Sullivan, Struck & Ballog, Daniel R. Sullivan and Eric C. Bradley; Jeffrey L. Garland for Plaintiffs and Appellants. Law Office of Michael A. Griott and Michael A. Griott for Defendant and Respondent.


Plaintiff Willie Jones appeals from the dismissal of his case against Gialisa Whitchurch following her successful motion to strike. The trial court granted the motion to strike Joness complaint on the grounds that he was required to bring his claim as a compulsory cross-complaint to Whitchurchs prior action, pursuant to Code of Civil Procedure, section 426.30. We agree and affirm.

I

FACTS AND PROCEDURAL BACKGROUND

On May 23, 2000, Joness dump truck and Whitchurchs car were involved in an accident on Pacific Coast Highway. On February 13, 2001, Whitchurch filed a lawsuit for personal injuries and property damage, naming Jones, individually and doing business as Willie T. and Son, R.J. Noble & Company (Noble), who was apparently Joness employer, and several other defendants, including F&D Enterprises and the State of California. Cross-complaints for indemnity were apparently filed, although they are not in the record designated on appeal.

Approximately one year later, in February 2002, the case settled. We do not know the details of the settlement as the agreement itself is not in the record, although the record does include the dismissals, without prejudice, of the cross-complaints by Noble, the State of California, F&D Enterprises, and Jones, individually and doing business as Willie T. and Son. Each of the dismissals stated it "shall not serve as a retraxit." Whitchurchs complaint was dismissed with prejudice.

In May 2002, Jones and Willie T. and Son filed a new action against Whitchurch, alleging property damage, loss of business opportunity, and loss of profits as a result of the May 2000 accident. Whitchurch moved to strike the complaint, arguing Joness causes of action should have been filed as compulsory cross-complaints pursuant to Code of Civil Procedure section 426.30 (unless otherwise noted, subsequent statutory references are to the Code of Civil Procedure). The trial court granted Whitchurchs motion to strike, and Jones now appeals.

II

DISCUSSION

Standard of Review

Because the applicability of section 426.30 is purely a question of law, we review the trial courts decision de novo. (Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799.)

Joness Action as a Compulsory Cross-Complaint

Section 426.30, subdivision (a) provides in pertinent part: "[I]f a party against whom a complaint has been filed and served fails to allege in a cross-complaint any related cause of action which (at the time of serving his answer to the complaint) he has against the plaintiff, such party may not thereafter in any other action assert against the plaintiff the related cause of action not pleaded."

Jones did not argue in the court below, and does not argue here, that his claims for property damage, loss of business opportunity, and loss of profits do not constitute "related causes of action" under section 426.30. Instead, he argued below that he was entitled to relief under section 473, the general provision permitting a court to grant relief on the basis of the moving partys "mistake, inadvertence, surprise, or excusable neglect." (§ 473, subd. (b).)

In opposition to the motion to strike, Jones claimed that the settlement in Whitchurchs original action had been conditioned on Joness ability to seek damages at a later date. He further argued that "the attorney handling the matter on behalf of F&D Enterprises and Willie T. Jones reasonable [sic] believed that in filing a dismissal without prejudice (retraxit) he would preserve plaintiffs [sic] future rights against defendant. The attorney o[f] record since the inception of the Whitechurch [sic] matter advised Mr. Jones to retain personal counsel and file a cross-complaint against Ms. Whitechurch [sic] for property damage. However, plaintiff [was] not educated in the law and did not fully understand the ramifications of not filing a [c]ross-complaint prior to settlement. With a settlement pending the attorney of record believed that in filing a dismissal without prejudice he would preserve plaintiffs [sic] right to file a property damage claim."

Thus, apparently via his opposition to Whitchurchs motion to strike, Jones believed the court should resurrect his cross-complaint against Whitchurch and amend it to add his new claims. Even if he was entitled to such relief, Jones failed to meet the statutes procedural requirements. (§ 473, subd. (b).) Filing an opposition to Whitchurchs motion to strike was not equivalent to affirmatively seeking relief under section 473. Relief under section 473 requires an application and either an attorney declaration of fault or other evidence demonstrating relief is appropriate.

In any event, Jones has apparently abandoned his section 473 argument on appeal and now argues that section 426.50 mandates reversal. Section 426.50 addresses the effect of failing to plead a cause of action entirely, stating: "A party who fails to plead a cause of action subject to the requirements of this article, whether through oversight, inadvertence, mistake, neglect, or other cause, may apply to the court for leave to amend his pleading, or to file a cross-complaint, to assert such cause at any time during the course of the action. The court, after notice to the adverse party, shall grant, upon such terms as may be just to the parties, leave to amend the pleading, or to file the cross-complaint, to assert such cause if the party who failed to plead the cause acted in good faith. This subdivision shall be liberally construed to avoid forfeiture of causes of action." (Italics added.)

Jones argues at length that the trial court may only deny relief in situations in which there is substantial evidence of bad faith. He fails to address, however, the key portion of the statute for purposes of this case: "[A]t any time during the course of the action." (§ 426.50.) Jones is not seeking to amend his pleading "during the course of the action." He is instead attempting to use this provision to defeat section 426.30, which requires that he must bring any "related cause of action" in a cross-complaint. (§ 426.30, subd. (a).)

Section 426.50 is simply inapplicable to this case. Jones was required to bring a cross-complaint during the original Whitchurch action under the plain language of section 426.30, and his argument that he honestly believed that he was not required to do so is unavailing. Indeed, Jones admits he was advised to retain counsel and file a cross-complaint for property damage.

The claim that his attorney believed that filing a dismissal without prejudice would preserve Joness rights is particularly unpersuasive in light of the published case law on this matter. In AL Holding Co. v. OBrien & Hicks, Inc. (1999) 75 Cal.App.4th 1310, the court addressed just such a situation. OBrien & Hicks (OBrien) had previously sued the Anden Group (Anden) and Andens lender, alleging claims arising from OBriens consulting work for Anden. (Id. at p. 1312.) OBrien and Andens lender negotiated and settled their dispute, and OBrien dismissed its claims against Anden. (Ibid.) AL Holding Company (AL), Andens successor in interest, subsequently filed a lawsuit against OBrien on a claim of amount due on an open book account. OBriens demurrer was sustained. (Id. at p. 1313.)

On appeal, AL did not argue that the open book account was not transactionally related. (AL Holding Co. v. OBrien & Hicks, Inc., supra, 75 Cal.App.4th at p. 1313.) Rather, it argued that once OBrien voluntarily dismissed its complaint against Anden, there was no lawsuit in which Anden was required to bring its cross-complaint. (Ibid.) The court stated: "The critical time period to which section 426.30 looks is that point in time when the complaint has been filed and served against a defendant and the defendant `fails to allege in a cross-complaint any related cause of action which (at the time of serving his answer to the complaint) he has against the plaintiff. (Italics added.) In this case the judicially noticed documents demonstrated that Andens answer to the first amended complaint was dated March 30, 1995. Neither then nor at any point up to the settlement conference statement dated June 27, 1996, had Anden either filed or sought leave to file a cross-complaint on its open book account claim. (§ 426.50.) Accordingly that claim was barred when AL Holding attempted to assert it in 1997. Such is the clear import of the statutory language." (Id. at pp. 1313-1314.)

There is no principled distinction between AL Holding Co. v. OBrien & Hicks, Inc., supra, 75 Cal.App.4th 1310, and the case at bar, and we reach the same result. Joness claims are undisputedly related to Whitchurchs original complaint, and voluntary dismissals do not preserve the right to bring what would have otherwise been a compulsory cross-complaint pursuant to section 426.30.

Waiver and Estoppel

Jones makes two arguments regarding waiver and estoppel, neither of which were raised below. (In re Aaron B. (1996) 46 Cal.App.4th 843, 846.) Even if they had been properly raised, neither argument has merit. First, Jones argues, "It is clear that any alleged transgression of . . . Section 426.30 must be pleaded as an affirmative defense in the defendants answer before that objection to the proceedings may be raised in the trial court." The only thing "clear" about this rather astonishing contention is that it is wrong. By filing a motion to strike, Whitchurchs time to answer the complaint was extended. (§ 435, subd. (c).) She raised the argument at the very earliest opportunity, and to argue it was "waived" by filing a motion to strike on that very ground is patently absurd.

Second, Jones argues that Whitchurch is estopped from asserting section 426.30 because she expressly agreed that the settlement of her claims, and the dismissals of the complaint and cross-complaints, were not retraxits. There is no such "agreement" apparent from the record. Each of the parties signed their dismissals only; they did not sign each others dismissals. Thus, all that is apparent from the dismissals is that each party asserted their own dismissal was without prejudice and did not operate as a retraxit of their own claims. There is no consent or acknowledgment of any other partys right to bring a future claim. Any purported agreement between the parties is not in the record, was not presented to the trial court, and is not properly before us on appeal.

Moreover, even if there was such an agreement, Jones offers no authority for the proposition that section 426.30 operates subject to principles of waiver or estoppel. The purpose of section 426.30 is to promote the efficient functioning of the court system by disposing of all claims related to a single transaction in one lawsuit. "The law abhors a multiplicity of actions, and the obvious intent of the Legislature in enacting the counterclaim statutes [citations] was to provide for the settlement, in a single action, of all conflicting claims between the parties arising out of the same transaction." (Flickinger v. Swedlow Engineering Co. (1955) 45 Cal.2d 388, 393 [interpreting prior statute].)

While one can generally waive the advantage of a law intended solely for his benefit, a law established for a public reason cannot be contravened by a private agreement. (Civ. Code, § 3513.) Section 426.30 is such a law, intended to further the efficient administration of justice. If litigants were permitted to contract around the requirement of bringing all related claims in a single action, this important public policy would be undermined. We therefore decline to create an exception to the Legislatures clearly stated intent requiring all transactionally related claims to be brought in a single action.

III

DISPOSITION

The judgment is affirmed. Whitchurch is entitled to her costs on appeal.

WE CONCUR: OLEARY, ACTING P. J. and FYBEL, J.


Summaries of

Jones v. Whitchurch

Court of Appeals of California, Fourth District, Division Three.
Nov 13, 2003
G031270 (Cal. Ct. App. Nov. 13, 2003)
Case details for

Jones v. Whitchurch

Case Details

Full title:WILLIE T. JONES et al., Plaintiffs and Appellants, v. GIALISA WHITCHURCH…

Court:Court of Appeals of California, Fourth District, Division Three.

Date published: Nov 13, 2003

Citations

G031270 (Cal. Ct. App. Nov. 13, 2003)