Opinion
A102320.
10-27-2003
STOREK & STOREK, INC., et al. Petitioners, v. THE SUPERIOR COURT OF ALAMEDA COUNTY, Respondent; CITICORP REAL ESTATE, INC., et al. Real Parties in Interest.
Petitioners seek a writ of error coram vobis to vacate the judgment on the ground that the trial judge was disqualified. We will grant relief and direct the trial court to reconsider the motion for entry of judgment.
I. FACTUAL AND PROCEDURAL BACKGROUND
In Storek & Storek, Inc. v. Citicorp Real Estate, Inc. (2002) 100 Cal.App.4th 44, we reversed a multi-million dollar judgment that had been obtained by the plaintiffs against the defendants Citicorp Real Estate, Inc., and Citibank, N.A. Thereafter, the defendants moved for entry of judgment in their favor, asserting that retrial was precluded. The plaintiffs opposed the motion, which was then heard by Judge Richman. Judge Richman granted the motion and entered judgment in favor of the defendants on November 27, 2002. Two consolidated appeals from that judgment are currently pending in this court (A101564, A101565).
Meanwhile, in October 2002, the defendants filed a memorandum of costs on appeal. The plaintiffs moved to tax or strike the defendants claimed costs, and a hearing was scheduled for March 10, 2003. A few days prior to the hearing date, Judge Richman issued a tentative ruling recusing himself from the matter and continuing the hearing before a different judge. No party contested the tentative ruling or appeared in court to seek clarification of the reasons for Judge Richmans recusal. The recusal order was entered on March 10, 2003.
The plaintiffs then filed the instant petition in this court for a writ of error coram vobis seeking to "undo a judgment entered by a judge who owns stock in defendants in whose favor judgment was rendered." Declarations of counsel accompanying the petition indicate that after the recusal Judge Richmans research attorney disclosed to counsel that Judge Richman owned stock in "Citicorp" but "had not previously keyed in on the fact that Citicorp was a party in this action, but realized his conflict of interest when he was preparing for the hearing [on the motion to strike costs]." The research attorney did not know "whether Judge Richman had a financial interest in Citicorp when he entered judgment in favor of Citicorp in November 2002." Furthermore, the research attorney said that Judge Richman "did not intend to vacate the judgment in favor of Citicorp (or any of his prior orders in the case) sua sponte, but invited counsel to take whatever action [they] deemed appropriate."
Attached as an exhibit to the petition is Judge Richmans "Statement of Economic Interests," filed March 4, 2003, with the Fair Political Practices Commission, which reveals that during the calendar year 2002 Judge Richman owned stock in "Citigroup, Inc.," valued between $10,001 and $100,000. Prior statements from 1999 through 2001 similarly show that Judge Richman has owned stock in Citigroup, Inc., since 1999. Another exhibit evinces that the defendants in this lawsuit, Citicorp Real Estate, Inc., and Citibank, N.A., are wholly-owned subsidiaries of Citigroup, Inc. Citigroup, Inc.—the entity in which Judge Richman owned stock—is a holding company and is the entity that is publicly traded.
We issued an order to show cause and stayed the briefing in the pending appeals.
II. DISCUSSION
The common law writ of error coram nobis exists "to correct an error of fact which was unrecognized prior to the final disposition of the proceeding." (In re Dyer (1948) 85 Cal.App.2d 394, 399.) Although used most often in criminal cases, the writ is available following a judgment in a civil proceeding. (Id. at p. 400.) A writ of error coram vobis is identical to the writ of error coram nobis except that the petition for the former is addressed to an appellate court instead of the court that rendered the judgment. (In re Derek W. (1999) 73 Cal.App.4th 828, 831, fn. 3 (Derek W.); Betz v. Pankow (1993) 16 Cal.App.4th 931, 941, fn. 5.) A writ of error coram vobis commands the trial court to reconsider its judgment in light of newly discovered evidence. (See Betz v. Pankow, supra, 16 Cal.App.4th at p. 941; Betz v. Pankow (1995) 31 Cal.App.4th 1503, 1507.)
A writ of error coram nobis will be granted only when three requirements are met: (1) some fact exists that was not presented at the trial on the merits and that, if presented, would have prevented the rendition of the judgment; (2) the new evidence does not go to the merits of the issues tried; and (3) the new evidence could not in the exercise of due diligence have been discovered earlier. (People v. Shipman (1965) 62 Cal.2d 226, 230; see also Derek W., supra, 73 Cal.App.4th at p. 832.) The additional requirements for a writ of coram vobis from the appellate court are (1) the error to be corrected does not appear in the record; (2) no other remedy is available; and (3) the issue involved has not been previously determined. (Betz v. Pankow, supra, 16 Cal.App.4th at p. 941; Los Angeles Airways, Inc. v. Hughes Tool Co. (1979) 95 Cal.App.3d 1, 9.)
We have previously recognized that a writ of error coram vobis is an appropriate remedy when the disqualification of a judge is discovered after judgment has been rendered. (See Betz v. Pankow, supra, 16 Cal.App.4th at p. 941.) When the grounds for disqualification of a judge are discovered before entry of judgment, the judge must disqualify himself or herself and the matter will be heard by a replacement judge. (Code Civ. Proc., § 170.3.) However, when the grounds for disqualification appear after judgment has been entered and while an appeal is pending, the appellate court may issue a writ of error coram vobis to set aside the judgment and allow the trial court to reconsider the matter. (Betz v. Pankow, supra, 16 Cal.App.4th at pp. 940-941.)
The central question for our analysis in the present case is whether the new facts that have come to light as alleged in the petition demonstrate Judge Richmans disqualification such that the judgment should not have been rendered by him.
A judge is disqualified when he or she "has a financial interest . . . in a party to the proceeding." (Code Civ. Proc., § 170.1, subd. (a)(3).) "Financial interest" is defined as "ownership of more than a 1 percent legal or equitable interest in a party, or a legal or equitable interest in a party of a fair market value in excess of one thousand five hundred dollars ($1,500), or a relationship as director, advisor or other active participant in the affairs of a party . . . ." (Code Civ. Proc., § 170.5, subd. (b), italics added.) Here, Judge Richman owns more than $10,000 worth of stock in Citigroup, Inc., but Citigroup, Inc., is not a party to the lawsuit. Rather, Citigroup, Inc., is a holding company and the parent corporation of the defendants in the action. The California Supreme Court has held that a judge is not disqualified by his ownership of stock in a nonparty corporation, even though that corporation owns substantially all the stock of a party defendant. (Central Pac. Ry. Co. v. Superior Court (1931) 211 Cal. 706, 719-720 (Central Pac.).) Until the Supreme Court decides otherwise, we are bound by that decision and compelled to conclude that Judge Richman was not disqualified by a financial interest in a party. (Auto Equity Sales, Inc. v. Superior Court (1962) 57 Cal.2d 450, 455.)
The disqualification statute in effect at the time of the Central Pac. decision provided that a judge shall not sit in any action "[i]n which he or she is interested as a holder or owner of any capital stock of a corporation." (Former Code Civ. Proc., § 170, subd (a)(2), stats. 1982, ch. 1644, § 1, p. 6678; Central Pac., supra, 211 Cal. at pp. 718-719.) The Supreme Court construed that language to mean that when a corporation is a party, a judge who owns stock in that corporation is disqualified. (Central Pac., supra, at p. 719.)
Nevertheless, another basis for disqualification exists. A judge is disqualified if "[f]or any reason . . . . 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)(C).) The existence of actual bias is not required. Nor is the standard based on the judges personal view of his or her own impartiality or on the litigants necessarily partisan views. The standard is fundamentally an objective one: whether a reasonable member of the public at large, aware of all the facts, would fairly entertain doubts on the judges impartiality. (Flier v. Superior Court (1994) 23 Cal.App.4th 165, 170 (Flier); United Farm Workers of America v. Superior Court (1985) 170 Cal.App.3d 97, 104-105.) The statute "represents a legislative judgment that due to the sensitivity of the question and inherent difficulties of proof as well as the importance of public confidence in the judicial system, the issue is not limited to the existence of an actual bias. . . . `To ensure that the proceedings appear to the public to be impartial and hence worthy of their confidence, the situation must be viewed through the eyes of the objective person. [Citations.]" (United Farm Workers of America, supra, at p. 104.) "[P]ublic perceptions of justice are not furthered when a judge who is reasonably thought to be biased in a matter hears the case." (Id. at p. 103; see also Catchpole v. Brannon (1995) 36 Cal.App.4th 237, 246 (Catchpole).)
Canon 2A of the California Code of Judicial Ethics provides that a judge "shall act at all times in a manner that promotes public confidence in the integrity and impartiality of the judiciary." The advisory committee commentary states: "The test for the appearance of impropriety is whether a person aware of the facts might reasonably entertain a doubt that the judge would be able to act with integrity, impartiality, and competence." (Advisory Com. com., Wests Ann. Codes, Rules (1996 ed.) foll. canon 2(A), p. 709.)
When the facts are undisputed, the disqualification of a judge is a question of law for the appellate court. (Flier, supra, 23 Cal.App.4th at p. 171.) We conclude from the record that an ordinary person aware of Judge Richmans stock ownership might reasonably question the judges impartiality. Indeed, Judge Richmans voluntary recusal on the motion to strike costs reflects that Judge Richman himself so found. If Judge Richman was disqualified to hear the motion concerning costs, he was equally disqualified to hear the defendants motion for entry of judgment. The judges statement of economic interest establishes that Judge Richman owned the Citigroup stock in 2002 just as he did in 2003. According to the judges research attorney, Judge Richman did not realize his financial interest until he was preparing for the hearing on the post-judgment motion in 2003. That fact indicates that Judge Richman would have recused himself earlier had he recognized the problem then. Because of the belated realization and because of the pending appeals, Judge Richman simply lacked jurisdiction to take corrective action. (See Betz v. Pankow, supra, 16 Cal.App.4th at p. 940 [trial court had no jurisdiction to vacate judgment while appeal pending; hence, coram vobis would be appropriate remedy].)
The defendants (real parties in interest) have asked us to take judicial notice of public information that Citigroup, Inc., had 5.078 billion shares outstanding in 2002, for a total capitalization of about $198 billion. Real parties argue from this evidence that Judge Richmans interest in Citigroup was proportionately so small that the judges financial stake in the $42 million judgment could not reasonably cast doubt on the judges impartiality. We grant the request for judicial notice, but we are not persuaded by the argument. A judge is disqualified by reason of a financial interest in a party with a value in excess of $1,500, regardless of the percentage of ownership and regardless of the ratio between the judges financial interest and the size of the judgment. (Code Civ. Proc., § 170.1, subd. (a)(3).) We are convinced that Judge Richmans interest in the nonparty holding company valued in excess of $10,000 is significant enough to raise a doubt as to his impartiality.
In sum, the evidence of Judge Richmans stock ownership constitutes new evidence that would have disqualified Judge Richman from rendering judgment had the evidence been timely disclosed. There is no dispute concerning the other requirements for coram vobis relief. The facts concerning Judge Richmans disqualification do not appear on the face of the record, could not have been reasonably discovered sooner, and should have been disclosed prior to the rendition of judgment. The issue of the judges disqualification to render judgment has not been previously determined and no other remedy exists. We will therefore grant relief.
We reject the argument of real parties in interest that relief is precluded by section 170.3, subdivision (b)(4), of the Code of Civil Procedure. That statute provides as follows: "In the event that grounds for disqualification are first learned of or arise after the judge has made one or more rulings in a proceeding but before the judge has completed judicial action in a proceeding, the judge shall, unless the disqualification be waived, disqualify himself or herself, but in the absence of good cause the rulings he or she made up to that time shall not be set aside by the judge who replaces the disqualified judge." (Italics added.) By its terms, the statute pertains to prejudgment rulings, not to the entry of judgment. (See Urias v. Harris Farms, Inc. (1991) 234 Cal.App.3d 415, 423.) Moreover, the statute limits the authority of the replacement trial judge; it does not affect our powers as an appellate court. When, as here, the judges disqualification is discovered after judgment has been entered and after a notice of appeal has been filed, relief is available by writ of error coram vobis. (Betz v. Pankow, supra, 16 Cal.App.4th at pp. 940-941.)
Nor can we agree with the assertion of real parties in interest that the harmless error rule precludes relief. Our conclusion that Judge Richman was disqualified to hear the motion for entry of judgment is necessarily a conclusion that judgment would not have been rendered by Judge Richman had the fact of his stock ownership been known at the time. It is irrelevant whether Judge Richmans decision in granting the motion for entry of judgment was correct, and we do not reach that question here. "Where the average person could well entertain doubt whether the trial judge was impartial, appellate courts are not required to speculate whether . . . the result would have been the same if the evidence had been impartially considered and the matter dispassionately decided." (Catchpole, supra, 36 Cal.App.4th at p. 247; Webber v Webber (1948) 33 Cal.2d 153, 161-162.)
The proper remedy on coram vobis is to reverse the judgment and remand the matter to the trial court for reconsideration. (Rollins v. City and County of San Francisco (1974) 37 Cal.App.3d 145, 150; see Betz v. Pankow, supra, 31 Cal.App.4th at p. 1507.) Having concluded as a matter of law that Judge Richman is disqualified to rehear the motion for entry of judgment, we will direct that the matter be heard by a different judge. (Code Civ. Proc., § 170.1, subd. (c).)
III. DISPOSITION
The order to show cause is discharged and the petition for writ of error coram vobis is granted. The judgment of November 27, 2002 is reversed, and the matter is remanded to respondent superior court for reconsideration of the motion for entry of judgment. The proceedings shall be heard by a trial judge other than Judge Richman.
Upon issuance of the remittitur, the stay of the briefing heretofore ordered in A101564 and A101565 shall be dissolved and the appeals shall be dismissed as moot.
We concur. JONES, P.J. and SIMONS, J.