Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Stanislaus County Nos. 351003, 350926, 351002, 351032, 350927, 351033, Roger M. Beauchesne, Judge.
David A. Prentice, County Counsel and Douglas Nelson, Deputy, and Cox, Castle & Nicholson, Andrew B. Sabey, for Madera County Board of Supervisors and the County of Madera, Defendants and Appellants.
Law Offices of Richard M. Pearl and Richard M. Pearl, Henry, Fitzgerald, Abbott & Beardsley, Barry H. Epstein and Paul S. Kibel, for Madera County Farm Bureau, Chowchilla Water District and Dennis Meisner, Jr., Plaintiffs and Respondents. Stoel & Rives, Barbara A. Renner and Stacy E. Gillespie, Henry, Logoluso & Blum, and Mark A. Blum, Law Offices of Richard M. Pearl, and Richard Pearl, for Madera Irrigation District, Plaintiffs and Respondents.
Sagaser, Jones & Helsley, Timothy Jones, John P. Kinsey and David W. Burnett, for Larry L. Frells, Central Green Company, Oak Grove Investors and River Vista Partners, Real Parties in Interest and Appellants.
OPINION
Ardaiz, P.J.
The trial court awarded $571,237.75 in attorney fees to respondents Madera County Farm Bureau (MCFB), Chowchilla Water District (CWD), Dennis Meisner, Jr., and Madera Irrigation District (MID) under the "private attorney general" attorney fee statute (Code Civ. Proc., § 1021.5) after respondents were successful in obtaining a writ of mandate setting aside the County of Madera's approval of a development project known as River Ranch Estates. The trial court's decision on the petition for writ of mandate was not appealed. This appeal is by the County of Madera and the Board of Supervisors of the County of Madera from the attorney fee award.
All further statutory references are to the Code of Civil Procedure unless otherwise stated.
The real parties in interest in the trial court were Central Green Company, Larry L. Frells, Oak Grove Investors and River Vista Partners. These real parties are aligned with the County of Madera and the Board. They have also filed a notice of appeal from the attorney fee award and thus are also appellants. We will refer to all six appellants collectively as "appellant" or "the County." We will henceforth refer to the four respondents on this appeal (MCFB, CWD, Meisner and MID), who were the petitioners in the trial court, as "petitioners."
The trial court's ruling on the attorney fee motion stated that "[t]he appropriate question is 'whether petitioners' beneficial interest is out of proportion to the beneficial interest to the public resulting from the relief.'" The County contends that the trial court applied the wrong standard in deciding whether the petitioners qualified for an award of attorney fees at all. The County argues that fees under section 1021.5 are unavailable when the primary purpose in bringing suit was to pursue and protect petitioners' own property rights rather than to furnish a significant public interest.
As we shall explain, we agree with appellants that the trial court applied the wrong standard in deciding petitioners' motion for section 1021.5 attorney fees. We do not agree, however, that the County is correct in its assertion that such fees are unavailable, as a matter of law, in all instances in which the primary purpose in bringing suit was to pursue and protect a plaintiff's own property rights rather than to furnish a significant public interest. As we shall explain, we cannot say on this record that there is no reasonable probability that the court would not have awarded attorney fees if the court had applied the correct standard. Accordingly, we will reverse the order of the trial court awarding those fees, and will remand the matter to the superior court for that court to decide the motion under the correct legal standard. We also wish to state, here at the outset, that we express no view one way or the other as to whether the trial court should or should not make an award of section 1021.5 attorney fees in this case. Our concern is simply that the court decide the motion under the proper legal standard.
FACTS
Petitioners' "Petition for Writ of Mandate and Complaint for Declaratory and Injunctive Relief" was one of six actions filed in June of 2004 challenging the County's approval of the River Ranch Estates project. All of the actions alleged that the County violated the California Environmental Quality Act in certifying the environmental impact report (EIR) for the project. Some of the actions, including this one, alleged violations of other laws as well. The parties to all six cases stipulated to a transfer of venue from Madera County Superior Court to Stanislaus County Superior Court. In Stanislaus County the plaintiffs and petitioners in all six actions moved for an order consolidating the actions for trial. The motion was unopposed and was granted. The record on this appeal does not disclose what became of all of the other five cases. At least two of them appear to have settled before this case was tried. Petitioners' brief asserts that “[o]nly the instant case proceeded through trial to Judgment’.
Petitioners’ brief in the trial court quoted the EIR’s description of the project as follows: “The River Ranch Estates development proposes to construct 1,646 dwellings in mixed densities on 548 acres (including streets), 20 acres of parks, an elementary school, fire stations, water and wastewater facilities, and approximately 92,500 square feet of commercial space.” The court's decision described the project as “a proposed residential, commercial and institutional development on 793 acres of farmland and open space in Madera County, California ... near the San Joaquin River.” The Madera County Planning Commission voted five to zero to deny the application for the River Ranch Estates project entitlements. Among its reasons for this decision was its view that the final EIR for the project was inadequate. The Madera County Director of Planning submitted a memorandum to the Madera County Board of Supervisors outlining the reasons the Commission was recommending denial of the proposed project. The memorandum stated in part: “‘The Planning Commission reviewed the information presented regarding the holding contracts and water availability and determined that sufficient information was not available to ensure that water would be available for the project.’” The Board nevertheless voted to certify the final EIR for the project and to approve the project. This action (and the five others) ensued.
The trial court concluded that the County had failed to comply in various respects with the California Water Supply Assessment Law (commonly referred to as “SB 610” - see Wat. Code, § 10910 et seq. and Stats. 2001, ch. 643) and with the California Environmental Quality Act (CEQA, Pub. Resources Code, § 21000 et seq.). We need not restate these findings in detail here. It will suffice to say, in a somewhat summary fashion, the court concluded that the Water Supply Assessment (WSA) prepared for the project violated SB 610 and CEQA in that it failed to present substantial evidence that sufficient water would be available for the project. The court also concluded that the County additionally violated CEQA by failing to recirculate the EIR for public review after significant new information about water diversion had been added to it, and by failing to include in the EIR any analysis of environmental impacts caused by increased diversions of San Joaquin River water. As we have already mentioned, this decision was not appealed. The court’s writ of mandate voided the County’s approvals for the project and ordered the County to “refrain from further approvals of the RRE Project unless and until the County ... complies with CEQA, and ... complies with SB 610, consistent with this Court's ... Decision ....”
Petitioners then brought their motion for attorney fees. As we have already mentioned, the County contended that petitioners were not entitled to section 1021.5 attorney fees because petitioners were primarily motivated by their own self-interest and not to furnish a significant public interest. The court's ruling awarding attorney fees stated in pertinent part:
“Respondents’ contention that Petitioners have a vested self-interest in the litigation such as to obviate an award of fees pursuant to Code of Civil Procedure § 1021.5 is unavailing.
“Petitioners correctly respond that such interest (whether labeled ‘self’ or ‘personal’) is an essential standing requirement for a petitioner seeking a writ of mandate pursuant to CCP § 1086. Also, see Waste Management of Alameda County, Inc. v. County of Alameda (2000) 79 Cal.App.4th 1223.
“The appropriate question is ‘whether petitioners’ beneficial interest is out of proportion to the beneficial interest to the public resulting from the relief.’ [Serrano] v. Priest (1977) 20 Cal.3d 25. The Court finds the beneficial interest to the public to be greater than each of Petitioners' self-interest.”
Both sides agree that the language appearing in quotation marks in the third above-quoted paragraph of the court's ruling, just before the citation to Serrano v. Priest, supra, 20 Cal.3d 25, is not a quote from Serrano v. Priest itself. The language appears to have been taken from a brief filed by petitioners in the trial court.
THE “PRIVATE ATTORNEY GENERAL” STATUTE
The Legislature enacted section 1021.5 in 1977. (Stats. 1977, ch. 1197, p. 3979, §§1,2.) The statute codified what is known as the “private attorney general” theory, which is used to award attorney fees to private litigants who engage in litigation resulting in the enforcement of an important right affecting the public interest. (Woodland Hills Residents Assn., Inc. v. City Council (1979) 23 Cal.3d 917, 925.) The private attorney general theory was first recognized in California in Serrano v. Priest, supra, 20 Cal.3d at pages 42-48, a case decided four days after section 1021.5 was signed into law but about three months before the statute's January 1, 1978 effective date. (Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 925, fn. 1.) Although the statute originally made attorney fees available only to qualified private litigants, the statute was amended in 1993 to allow the recovery of attorney fees also “by one public entity against another public entity” in appropriate circumstances. (Stats. 1993, ch. 645 (S.B. 764), §2.) Section 1021.5 now states:
The four petitioners (respondents on this appeal) who were awarded attorney fees in the trial court are a private entity (Madera County Farm Bureau), a private individual (Dennis Meisner, Jr.), and two public entities (Chowchilla Water District and Madera Irrigation District).
“Upon 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, or of enforcement by one public entity against another public entity, 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. With respect to actions involving public entities, this section applies to allowances against, but not in favor of, public entities, and no claim shall be required to be filed therefor, unless one or more successful parties and one or more opposing parties are public entities, in which case no claim shall be required to be filed therefor under Part 3 (commencing with Section 900) of Division 3.6 of Title 1 of the Government Code.
“Attorneys’ fees awarded to a public entity pursuant to this section shall not be increased or decreased by a multiplier based upon extrinsic circumstances, as discussed in Serrano v. Priest, 20 Cal.3d 25, 49.”
An appellate court “will uphold the trial court's decision to award attorney fees under section 1021.5, unless the court has abused its discretion.” (Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553, 558.) The court in Vasquez v. State of California (2008) 45 Cal.4th 243 recently restated and emphasized the wide discretion afforded to trial courts in deciding whether to award attorney fees under the statute.
“Section 1021.5 authorizes a court to ‘award attorneys’ fees to a successful party … in any action which has resulted in the enforcement of an important right affecting the public interest .…’ The Legislature enacted the provision to codify the private attorney general doctrine previously developed by the courts. [Citations.] The doctrine rests on the recognition that privately initiated lawsuits, while often essential to effectuate important public policies, will as a practical matter frequently be infeasible without some mechanism authorizing courts to award fees. [Citations.] Accordingly, ‘“the fundamental objective of the doctrine is to encourage suites enforcing important public policies by providing substantial attorney fees to successful litigants in such cases.”’ [Citations.]
“A court may award attorney fees under section 1021.5 only if the statute's requirements are satisfied. Thus, a court may award fees only to ‘a successful party’ and only if the action has ‘resulted in the enforcement of an important right affecting the public interest .…’ [Citation.] Three additional conditions must also exist: ‘(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, or of enforcement by one public entity against another public entity, 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.’ Section 1021.5 codifies the courts’ ‘traditional equitable discretion’ concerning attorney fees [citation], and within the statutory parameters courts retain considerable discretion. ‘[T]he Legislature has assigned responsibility for awarding fees under section 1021.5 “not to automations …, but to judges expected and instructed to exercise 'discretion.’”’ [Citations.] In deciding whether to award fees, the court ‘must realistically assess the litigation and determine, from a practical perspective, whether or not the action served to vindicate an important right so as to justify an attorney fee award under a private attorney general theory.’ [Citation.] A reviewing court ‘will uphold the trial court’s decision to award attorney fees under section 1021.5, unless the court has abused its discretion.’ [Citation.]” (Vasquez v. State of California, supra, 45 Cal.4th at pp. 250-251.)
Vasquez also highlighted and restated the five factors necessary for an award of fees under the statute. First, the court may award fees only to “a successful party.” (Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 934.) Petitioners were the successful parties here. Second, there must be an action which has “resulted in the enforcement of an important right affecting the public interest.” (Ibid.) In this regard, “the Legislature obviously intended that there be some selectivity, on a qualitative basis, in the award of attorney fees under the statute, for section 1021.5 specifically alludes to litigation which vindicates ‘important’ rights and does not encompass the enforcement of ‘any’ or ‘all’ statutory rights.” (Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 935.) The third, fourth and fifth factors of section 1021.5 are the three qualifying factors labeled in the statute as (a), (b) and (c). Factor “(a)” is that “a significant benefit, whether pecuniary or nonpecuniary, has been conferred on the general public or a large class of persons.” On the meaning of “significant,” it has been said “the fact that the chief benefits afforded by an action have no readily ascertainable economic or monetary value in no way forecloses an attorney fee award under the statute.” (Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 939.) “This language recognizes that in many cases the important gains or contributions rendered by public interest litigation will be reflected in nonmonetary advances.… [¶] … [T]he ‘significant benefit’ that will justify an attorney fee award need not represent a ‘tangible’ asset or a ‘concrete’ gain but, in some cases, may be recognized simply from the effectuation of a fundamental constitutional or statutory policy.” (Ibid.) The trial court apparently concluded that the right to have a legally adequate environmental impact report and water supply assessment for a project of this magnitude was an important right affecting the public interest, and that the achievement of that objective was a significant benefit conferred on the general public or on a large class of persons. Preliminary to discussion of the fourth factor we note that the fifth and final qualifying factor “(c)” for section 1021.5 attorney fees (“such fees should not in the interest of justice be paid out of the recovery, if any”) is not pertinent to the case before us because the case did not seek and did not obtain any monetary recovery. (See Press v. Lucky Stores. Inc. (1983) 34 Cal.3d 311, 318, fn. 5.) It obtained a writ of mandate requiring compliance with CEQA and with S.B. 610.
This brings us to the remaining factor which must be satisfied for the successful party to qualify for an award of section 1021.5 attorney fees - the statute's factor “(b)” requirement that “the necessity and financial burden of private enforcement, or of enforcement by one public entity against another public entity, are such as to make the award appropriate.”
As to this factor, the courts have said: “An award on the ‘private attorney general’ theory is appropriate when the cost of the claimants 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.’” (County of Inyo v. City of Los Angeles (1978) 78 Cal.App.3d 82, 89; Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 941; In re Adoption of Joshua S. (2008) 42 Cal.4th 945, 952.) "A court generally determines whether the litigation places a disproportionate burden on the individual by comparing the expected value of the litigation at the time it was commenced with the costs of litigation." (In re Adoption of Joshua S.. supra, 42 Cal.4th at p. 952.)
The test applied by the trial court (“whether petitioners’ beneficial interest is out of proportion to the beneficial interest to the public resulting from the relief” and whether “the beneficial interest to the public [is] greater than each of Petitioners’ self-interest”) is nowhere found in the law. Although we agree with Petitioners that an appellate court will begin with a presumption that the trial court correctly followed the law, this presumption is overcome when the record on appeal shows that the trial court applied the wrong legal test. “When the record clearly demonstrates that what the trial court did, we will not presume it did something different.” (Lafayette Morehouse, Inc. v. Chronicle Pub. Co. (1995) 39 Cal.App.4th 1379, 1384.) The trial court’s stated test does not appear to have taken into consideration “the necessity and financial burden of private enforcement” (§ 1021.5(b)) at all. It is also true that an appellate court will not reverse a trial court’s ruling unless it is reasonably probable that a result more favorable to the appealing party would have been reached in the absence of the error. (Elsner v. Uveges (2004) 34 Cal.4th 915, 939.) “We have made it clear that a ‘probability’ in this context does not mean more likely than not, but merely a reasonable chance, more than an abstract possibility.” (College Hospital, Inc. v. Superior Court (1994) 8 Cal.4th 704, 715; in accord, see Kinsman v. Unocal Corp. (2005) 37 Cal.4th 659, 682.) Given that there were five other civil actions attacking the County’s approval of the River Ranch Estates project, the trial court had an obligation to consider “the necessity” of this one. (§ 1021.5.) We do not here imply that this action was or was not necessary. Our concern is simply that the court apply the proper test and consider all of the appropriate factors, including factor “(b)” in the statute.
OTHER ISSUES
Appellant cites several authorities as support for the argument that section 1021.5 attorney fees “are precluded for parties whose primary purpose in initiating litigation is the vindication of their own interests.” Our review of these cases does not lead us, however, to the conclusion that they stand for that proposition. For example:
In Williams v. San Francisco Bd. Of Permit Appeals (1999) 74 Cal.App.4th 961, the trial court refused to award section 1021.5 attorney fees, and the appellate court affirmed. The fee applicant had succeeded in preventing the construction of a large condominium or apartment complex next door to his own residence. The appellate court noted that the trial court had discretion as to whether to award attorney fees, and that the trial court had not abused that discretion. Nothing in the opinion asserts that the trial court could not have awarded attorney fees if it had elected to do so. The case merely stands for the proposition that a plaintiff's stake in the outcome of a case need not be deemed nil simply because his stake was not economic or pecuniary. (Williams, supra, 74 Cal.App.4th at p. 966.)
In Terminal Plaza Corp. v. City and County of San Francisco (1986) 177 Cal.App.3d 892, the trial court refused to award attorney fees and the appellate court affirmed, stating that “the trial court did not abuse its discretion by denying an award of attorney fees.” (Id. at p. 914.) Nothing in the case states that a litigant motivated by his own self-interest cannot obtain section 1021.5 attorney fees.
In Save Open Space Santa Monica Mountains v. Superior Court (2000) 84 Cal.App.4th 235, there was no award of attorney fees at all. The case involved a discovery dispute. The opinion notes that “[i]n order to establish the prerequisite set forth in [factor] (b) of section 1021.5, the party seeking an award on the ‘private attorney general’ theory ‘bears the burden of establishing that its litigation costs transcend its personal interest.’” (Save Open Space, supra, 84 Cal.App.4th at p. 247.) Nothing in the case states that a litigant who is primarily motivated by his own self-interest is ineligible for section 1021.5 attorney fees.
Finally, the County makes an argument that the court erred in denying a motion it had made to reopen discovery so that it could conduct discovery on petitioners’ motives in filing suit. The County makes no showing, however, that this discovery ruling was ever appealed. The appeal here was from the court's order denying section 1021.5 attorney fees, not from a discovery ruling made five months earlier and never challenged by writ or appeal. (See § 904.1.)
DISPOSITION
The trial court’s order awarding section 1021.5 attorney fees is reversed. The matter is remanded to the superior court for that court to reconsider the motion in accordance with the views expressed in this opinion. Costs to appellants.
WE CONCUR: Levy, J., Kane, J.