Perez v. Breen

Filed 7/17/06 Perez v. Breen CA2/6

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SIX

Following an unsuccessful real estate transaction, appellant filed an action against his broker, seeking $8.5 million in damages. Appellant failed to appear for a settlement conference and a trial setting conference or to cooperate with his own counsel. The trial court allowed appellant's attorney to withdraw from the case, sanctioned appellant and ultimately dismissed the case with prejudice. Appellant claims the trial court abused its discretion because he had a valid reason for his nonappearance. Moreover, the matter was over two years old and it would cause him undue hardship for new counsel to become familiar with the case. We affirm.

FACTS

Richard J. Breen is a real estate broker and the president of Breen Realty, Inc. (respondent), located in Cambria, California. In 1996 appellant entered into an agreement through respondent to purchase the 632-acre Machado Ranch in San Luis Obispo for approximately $1.5 million. He executed several promissory notes in favor of the sellers. The sale was completed over a period of six months and appellant alleges that he made a down payment of approximately $800,000 and paid $100,000 in closing costs.

Appellant defaulted on the notes and, in 1998, the sellers began foreclosure proceedings. Appellant signed a one-year listing agreement with respondent to sell the property, but he made no attempt to market it. One week before the foreclosure sale, respondent produced buyers, Raymond C. Derby and Pamela J. Derby. They paid $150,000 to cure appellant's default and gave him an option to purchase the property for $2.1 million by December 1999. Appellant was unable to obtain the funds, did not exercise the option and lost the property. Appellant contends this transaction benefited only respondent and the Derbys at appellant's expense.

Appellant argues that respondent's conduct was tortious because he was both the listing agent and buyers' agent for the sale of the ranch, and because appellant relied on respondent's advice in entering into the option contract and listing agreement. Appellant believes that the fair market value of the ranch is now $9 million.

PROCEDURAL HISTORY

Appellant filed this action against respondent for breach of contract; breach of the covenant of good faith and fair dealing; fraud; breach of fiduciary duties; intentional misrepresentation; negligent misrepresentation; and negligence.

A mandatory settlement conference was scheduled for January 14, 2005. Appellant's attorney was present, but appellant failed to appear. The court issued an order to show cause (OSC) why appellant should not be held in contempt. It set the hearing on the OSC for January 26, 2005, and continued the settlement conference for the same date. Appellant was ordered to personally appear and did so, albeit late. On that date, the matter was continued by a judge pro-tem to February 2.

Prior to the hearing, appellant's attorney, Rosendo Gonzalez, filed a motion to be relieved as counsel. He stated in his declaration that appellant no longer responded to telephone calls or letters, so Gonzalez could not obtain the necessary information to represent him at trial. Appellant had not communicated with Gonzalez since November 15, 2004, and Gonzalez has been unable to leave appellant a telephone message since early January 2005. He believed that the three phone numbers appellant provided were no longer in service. His attorney's fees remained unpaid.

Appellant attended the February 2, 2005 hearing. The court granted Gonzalez's motion to withdraw as attorney of record and ordered appellant to pay sanctions of $2,372.56 to respondent. The court vacated the trial date and scheduled a readiness conference for March 2, 2005. Appellant was ordered to obtain new counsel or be prepared to conduct the trial in pro. per. Appellant did not personally appear on March 2, and the trial setting conference was continued to March 16.^[1]

On March 16, 2005, appellant appeared in pro. per. and the court set a trial readiness conference for May 11 with a trial date to follow five days later. Appellant failed to appear for the May 11 conference. The court vacated the trial date and issued an OSC why the case should not be dismissed. At the OSC hearing on June 1, appellant appeared with attorney Steven R. Cameron.^[2]

The court issued a written order, stating that "[h]aving heard oral argument from counsel and having received a verbal statement from [appellant], concerning his failure to attend the Trial Readiness Conference of May 11, 2005, this Court makes the following Orders: [¶] 1) Plaintiff did not provide a sufficient justification for his failure to attend the trial Readiness Conference or provide good cause as to why this case should not be dismissed. [¶] 2) The above-entitled matter is hereby dismissed with prejudice." No court reporter was present at the hearing and the trial court's order does not reflect the content of appellant's verbal statement.

Appellant failed to include all the minute orders from the proceedings below to provide us with a complete chronology of events. He designated for the record only the minute order from the February 2, 2005 hearing, and the written order from the June 1 hearing. We granted respondent's motion to augment the record to include the minute orders from the hearings on January 14 and 26; March 2 and 16; and May 11 and June 1.

DISCUSSION

In his opening brief, appellant claims he told the court that he failed to appear at the conference on May 11 because "he had taken down the date for the Trial Setting Conference wrong and appeared on the day following the actual hearing." He further contends that the trial court abused its discretion by dismissing the case because he was represented by counsel and told the court he was ready to proceed to trial. Neither of his alleged statements to the court is borne out by the record. Although appellant made these statements in his opening brief, he did not cite to the record to support his assertions.

In a contradictory argument, appellant claims that the court abused its discretion because the case was approximately two years old and the trial court had relieved his attorney, leaving him "with no idea of how to proceed and in dire need of trial counsel." He indicates that he told the trial court that his failure to appear had been "unintentional" and he had great difficulty finding an attorney who would take a case that was two years old and ready to proceed to trial.

Standard of Review

When reviewing a discretionary dismissal, an appellate court must presume the trial court's decision is correct. (Howard v. Thrifty Drug & Discount Stores (1995) 10 Cal.4th 424, 443.) Even if there is no indication of the trial court's rationale for dismissing an action, we will uphold its decision if reasonable justification can be found. (Ibid.) The burden is on the plaintiff to show a clear abuse of discretion constituting a miscarriage of justice. (Blank v. Kirwan (1985) 39 Cal.3d 311, 331.)

Failure to Cite to Record

It is well settled that a party is required to support the statement of any matter in the record by an appropriate reference to the record. (Cal. Rules of Court, rules 14(a)(1)(C) & (2)(C).) Failure to cite to the record can subject a party to the imposition of sanctions or cause an issue to be waived. (Pierotti v. Torian (2000) 81 Cal.App.4th 17, 29-31 [sanctions]; Schulz v. Wulfing (1967) 251 Cal.App.2d 776, 779-780 [sanctions]; People v. Dougherty (1982) 138 Cal.App.3d 278, 283 [waiver]; Haynes v. Gwynn (1967) 248 Cal.App.2d 149, 151 [waiver].) Appellant has violated court rules by failing to cite to the record to support factual assertions material to his appeal. We discuss the consequences of these violations more fully below.

Dismissal for Delay in Prosecution

The trial court has discretion to dismiss an action on its own motion if the action is not brought to trial within two or three years after it was commenced. (Code Civ. Proc., §§ 583.410; 583.420, subd. (a)(2); Cal. Rules of Court, rule 372; Black Historical Society v. City of San Diego (2005) 134 Cal.App.4th 670, 676.) The policy favoring disposition of the action on the merits is generally preferred over the policy that requires dismissal for failure to proceed with reasonable diligence. (Salas v. Sears, Roebuck & Co. (1986) 42 Cal.3d 342, 347.) Disposition on the merits, however, is generally favored only where the plaintiff makes a showing of excusable delay. (Wilson v. Sunshine Meat & Liquor Co. (1983) 34 Cal.3d 554, 562-563.)

Appellant filed the action on December 9, 2002, and the matter was dismissed on June 29, 2005, approximately two and a half years later. He correctly notes that denial of a motion to dismiss after two years is discretionary with the trial court, citing Denham v. Superior Court (1970) 2 Cal.3d 557, 563 and Brown v. Superior Court (1970) 7 Cal.App.3d 366, 368. Appellant relies on City of Los Angeles v. Gleneagle Dev. Co. (1976) 62 Cal.App.3d 543, for the proposition that dismissal is an abuse of discretion when there is a reasonable excuse for delay. (Id. at p. 561.)^[3] Appellant contends that the trial court's dismissal of the case two years after it was filed, combined with its knowledge that he was prepared to go to trial, constituted an abuse of discretion.

Appellant's argument does not directly address the issue before us. This was not a situation in which the matter was dismissed based upon statutes governing a delay in prosecution. Rather, the dismissal was due to appellant's repeated violations of the court's order to appear. Although appellant had the opportunity, he did not file opposition to the OSC explaining his absences or move for reconsideration of the trial court's ruling. The written order reflects that the court found appellant's verbal statement insufficient to justify his nonappearance. Because the record is devoid of evidence concerning appellant's reason for failing to appear, we are unable to consider his argument that the court abused its discretion. Under these circumstances, we are obligated to uphold the dismissal order. (Terzian v. County of Ventura (1994) 24 Cal.App.4th 78, 83.)

Dismissal with Prejudice

The trial court possesses an underlying and inherent discretionary power to dismiss that is independent of specific statutory grounds for dismissal. (See 6 Witkin, Cal. Procedure (4th ed. 1997) Proceedings Without Trial, § 252, p. 670.) Code of Civil Procedure section 581 governs judgments of dismissal generally. (Ibid.) Appellant claims that the trial court lacked authority to dismiss the action with prejudice. He contends that, under section 581 subdivision (b)(5), an action may only be dismissed "without prejudice, when either party fails to appear on the trial and the other party appears and asks for dismissal." (Italics added.)^[4]

Section 581, subdivision (b)(5) is inapplicable to the instant facts. The matter had not yet been brought to trial and a request for dismissal was not made by a party, but on the court's own motion. Moreover, the statute provides that "[t]he "provisions of this section shall not be deemed an exclusive enumeration of the court's power to dismiss an action . . . ." (§ 581, subd. (m).)

Appellant cites sections 583.110 et seq. to argue the statutes governing dismissal for delay in prosecution do not mention the issue of prejudice at all, thus the order of dismissal should be reversed. We reject his argument for two reasons. First, the ground for dismissal was not dilatory prosecution, but a violation of the court order requiring appellant to appear. Secondly, section 583.150 specifically provides that the chapter "does not limit or affect the authority of a court to dismiss an action or impose other sanctions . . . under [the] inherent authority of the court."^[5]

Request for Sanctions

In the reply brief, respondent's counsel requests sanctions against appellant for filing a frivolous appeal. (Cal. Rules of Court, rule 27(e), § 907.) He also filed a separate motion requesting sanctions in the amount of $6,657. Attached as an exhibit was a billing statement reflecting this sum as respondent's fees and costs in preparing the appeal.

We advised appellant that we were considering the imposition of sanctions and gave him an opportunity to respond. He filed opposition, arguing that he was "compelled to rely on a minimal record" and respondent's motion is an "attempt to bootstrap the lack of a more definitive record into a finding that the appeal is frivolous . . . ." Appellant acknowledges that he made two statements in his brief that find no support in the record: (1) his explanation to the court concerning why he did not attend the hearing; and (2) that he appeared with counsel and declared himself ready for trial. His conclusion that "[s]uch statements are both minor and do not constitute an unreasonable infraction of the rules governing appeals such that sanctions should be imposed" is incorrect and a flagrant disregard of court rules.

Appellant is represented on appeal by attorney Stephen R. Cameron, who also represented him at the second OSC hearing. In a declaration attached to the opposition, Cameron stated that he had "agreed to become involved" in the case "within 36 hours of the hearing on the OSC re Dismissal" and there was no time to prepare a declaration by appellant concerning his failure to appear. He stated that, prior to the hearing, he spoke to appellant's former attorney, and was "assured . . . that the action has merit." Cameron declared that "[e]ach of the oral statements that I have made reference to in Appellant's Opening Brief did, in fact, occur and each of the statements is complete and true." Without giving notice, Cameron failed to appear at oral argument.

An appellate court may impose sanctions for a frivolous appeal. (Pollock v. University of Southern California (2003) 112 Cal.App.4th 1416, 1431-1432; Estate of Gilkison (1998) 65 Cal.App.4th 1443, 1451.) Sanctions may be imposed against a litigant, an attorney or both. (Pierotti v. Torian, supra, 81 Cal.App.4th at p. 36; In re Marriage of Schnabel (1994) 30 Cal.App.4th 747, 755.) An appeal is frivolous "when any reasonable attorney would agree that the appeal is totally and completely without merit." (In re Marriage of Flaherty (1982) 31 Cal.3d 637, 650.) This appeal is indisputably devoid of merit. This opinion constitutes the written statement of reasons required by In re Marriage of Flaherty, supra, 31 Cal.3d at page 654.

The judgment (order of dismissal) is affirmed. As a sanction for this frivolous appeal, attorney Stephen R. Cameron is ordered to pay respondent's counsel the sum of $6,657. Costs on appeal are awarded to respondents.

Pursuant to Business and Professions Code section 6086.7, subdivision (a)(3), the clerk of this court is directed to forward a copy of this opinion to the state bar.

NOT TO BE PUBLISHED.

COFFEE, J.

We concur:

GILBERT, P.J.

YEGAN, J.

Roger T. Picquet, Judge

Superior Court County of San Luis Obispo

______________________________

Law Offices of Steven R. Cameron and Steven R. Cameron for Plaintiff and Appellant.

Hall, Hieatt & Connely and Mark B. Connely for Defendant and Respondent.

Publication Courtesy of California attorney referral.

Analysis and review provided by Vista Real Estate Lawyers.

^[1] The minute order reflects that another individual (not counsel) made an appearance on appellant's behalf.

^[2] On June 1, 2005, appellant filed a substitution of attorney indicating that Steven R. Cameron had substituted in as his counsel. The form was executed on May 26, 2005.

^[3] The authorities upon which appellant relies are based on Code of Civil Procedure, former section 583 which was repealed in 1984. It was replaced in part with sections 583.410 and 583.420. (Stats. 1984, ch. 1705, § 4; see Blank v. Kirwan, supra, 39 Cal.3d at p. 332, fn. 7.)

^[4] All further statutory references are to the Code of Civil Procedure, unless otherwise stated.

^[5] "This chapter does not limit or affect the authority of a court to dismiss an action or impose other sanctions under a rule adopted by the court pursuant to Section 575.1, or by the Judicial Council pursuant to statute, or otherwise under [the] inherent authority of the court." (§ 583.150.) Section 575.1 concerns the promulgation of local court rules.