Pac. Gas & Elec. Co. v. Superior Court of Sacramento Cnty., C085308

• Citation: 24 Cal.App.5th 1150,235 Cal.Rptr.3d 228
• Decision Date: 02 July 2018
• Docket Number: C085308
• Parties: PACIFIC GAS AND ELECTRIC COMPANY et al., Petitioners, v. The SUPERIOR COURT of Sacramento County, Respondent; Richard Abi–Habib et al., Real Parties in Interest.
• Court: California Court of Appeals

24 Cal.App.5th 1150

235 Cal.Rptr.3d 228

PACIFIC GAS AND ELECTRIC COMPANY et al., Petitioners,

v.The SUPERIOR COURT of Sacramento County, Respondent;

Richard Abi–Habib et al., Real Parties in Interest.

C085308

Court of Appeal, Third District, California.

Filed July 2, 2018

As Modified on Denial of Rehearing July 26, 2018

Quinn, Emanuel, Urquhart & Sullivan, Kathleen M. Sullivan, Robert Feldman, Redwood Shores, and Daniel H. Bromberg for Petitioners.

No appearance for Respondent.

Dreyer, Babich, Buccola, Wood, Campora, Steven M. Campora, Sacramento, Robert A. Buccola, Sacramento, Catia G. Saravia; Corey, Luzaich, de Ghetaldi, Nastari & Riddle, Dario de Ghetaldi, Amanda L. Riddle, Millbrae; Cotchett, Pitre & McCarthy and Frank M. Pitre, Burlingame, for Real Parties in Interest.

RENNER, J.

This coordinated proceeding arises out of the Butte Fire, a devastating wildfire that swept through Calaveras and Amador counties in September 2015. The fire started when a tree came into contact with an overhead power line owned and operated by petitioners Pacific Gas and Electric Company and PG&E Corporation (together, PG&E or the company). Real parties in interest (plaintiffs) brought suit against PG&E, seeking punitive damages under Public Utilities Code section 2106 and Civil Code section 3294.¹ PG&E sought summary adjudication of plaintiffs’ request for punitive damages under section 3294 only. The trial court denied the motion.

PG&E seeks writ relief from the trial court’s order. We conclude there are no triable issues of fact which, if resolved in plaintiffs’ favor, could subject PG&E to punitive damages under section 3294.² Accordingly, we grant the petition.

I. BACKGROUND

A. The Butte Fire

The Butte Fire started on September 9, 2015, near Butte Mountain Road in Jackson, California.³ The fire spread rapidly through drought-stricken Amador and Calaveras counties. By the time the blaze was contained some three weeks later, the fire had consumed more than 70,868 acres, damaging hundreds of structures and claiming two lives. It is undisputed that the fire started when a gray pine (the subject tree) came into contact with one of PG&E’s power lines.

B. The Litigation

More than 2,050 plaintiffs brought suit against PG&E and others. Plaintiffs’ complaints were consolidated in a Judicial Council Coordinated Proceeding in Sacramento Superior Court. A master complaint was filed on behalf of plaintiffs (many of whom have been named as real parties in interest) who suffered personal injuries and losses to real and personal property as a result of the fire. The master complaint names PG&E, ACRT, Inc. (ACRT) and Trees, Inc. as defendants. According to the master complaint, ACRT and Trees, Inc. (together, contractors) provided vegetation management services to PG&E as independent contractors.

The master complaint alleges that PG&E and the contractors failed to properly maintain the power line and adjacent vegetation. According to the master complaint, the events leading to the Butte Fire were set into motion when two trees were removed from a stand near the power line, leaving the subject tree exposed and unsupported. The master complaint alleges that the removal of the two trees left the subject tree open and leaning to the south, towards the path of the sun and the nearby power line. The subject tree is alleged to have been approximately 44 feet tall and seven inches in diameter. Under the circumstances, the master complaint avers, it was foreseeable that the subject tree would fail and come into contact with the power line, producing sparks that could—and tragically, did—ignite a wildfire.

The master complaint asserts causes of action against PG&E for negligence, wrongful death and survival, inverse condemnation, public nuisance, private nuisance, premises liability, trespass, violation of Public Utilities Code section 2106 and violation of Health and Safety Code section 13007. The master complaint seeks punitive damages from PG&E under Public Utilities Code section 2106 and section 3294.

C. The Motion for Summary Adjudication

PG&E moved for summary adjudication of the request for punitive damages under section 3924, arguing that plaintiffs could not raise a triable issue of material fact to support the request under any theory. In support of the motion, PG&E presented evidence that contractors’ employees visited the area near the subject tree several times over the course of the year preceding the fire, but did not identify the subject tree as a danger or report any compliance issue to PG&E. PG&E also presented evidence that the company has expended substantial resources to establish vegetation management programs intended to prevent or minimize the risk of wildfire. According to PG&E, the existence of such programs affirmatively disproves any inference that PG&E acted with conscious disregard for the safety of others, thereby negating a necessary element of plaintiffs’ claim for punitive damages.

Plaintiffs opposed the motion, arguing that contractors’ employees are unqualified and improperly trained, and PG&E’s vegetation management programs are superficial and ineffective. According to plaintiffs, these programs are little more than window dressing

, designed to create the appearance of an effective risk management program and attention to public safety. In support of their opposition, plaintiffs submitted evidence that PG&E’s risk and compliance committee merely assumed that the company’s risk mitigation measures were functioning as intended, but failed to take steps to ensure that this was the case. Plaintiffs also submitted evidence that PG&E failed to ensure that contractors’ employees were qualified and properly trained to identify vulnerable trees, such as the subject tree. According to plaintiffs, the evidence established that "the Butte Fire was the result of PG&E’s years of continued, conscious disregard for ensuring the proper functioning of risk management controls that [PG&E] knew were essential to safeguard the public and their property from the risk of wildfire."

In anticipation of the hearing, the trial court issued a lengthy tentative ruling granting the motion for summary adjudication. The tentative ruling found that, "in most instances, plaintiffs fail to contend much less offer evidence supporting, any connection between the alleged failings in PG&E’s [vegetation management] programs and the Butte Fire." The tentative ruling further found that, "much of the evidence plaintiffs cite as failings in PG&E’s management of its power lines does not support a finding that PG&E acted with ‘malice’—that it was aware of the dangerous consequences of its conduct and deliberately failed to avoid those consequences." Accordingly, the trial court tentatively found that plaintiffs’ evidence was insufficient as a matter of law to raise a triable issue of fact as to their entitlement to punitive damages.

At the hearing on the motion for summary adjudication, plaintiffs argued clearly for the first time that punitive damages are appropriate because (1) PG&E has a nondelegable duty to operate its power lines safely, (2) PG&E sought to delegate responsibility for this duty to independent contractors, and (3) PG&E failed to ensure that contractors hired employees who were qualified and properly trained, such that (4) PG&E’s conduct demonstrates conscious disregard of the safety of others, whether or not PG&E was aware of its contractors’ alleged deficiencies. Relying on Romo v. Ford Motor Co. (2002) 99 Cal.App.4th 1115, 122 Cal.Rptr.2d 139 ( Romo I ), cert. granted and judgment vacated by Ford Motor Co. v. Romo (2003) 538 U.S. 1028, 123 S.Ct. 2072, 155 L.Ed.2d 1056, plaintiffs’ counsel argued that California law does not permit PG&E to "shield itself" from punitive damages liability by delegating responsibility for safeguarding the public against the risk of wildfire to independent contractors. ( Romo I, supra, at p. 1140, 122 Cal.Rptr.2d 139.)

After the hearing, the trial court invited the parties to submit supplemental briefs addressing plaintiffs’ newly articulated theory. Following further briefing, the trial court changed its tentative ruling and denied the motion for summary adjudication. The trial court explained, "PG&E was aware of the risk and the need for those inspecting or removing trees to be qualified. Its contracts required ACRT and Trees[, Inc.] to use qualified personnel. Plaintiffs offer evidence the inspectors were in fact not qualified, and this resulted in their failure to identify the danger posed by the Subject Tree. Plaintiffs, however, offer no evidence PG&E was on notice of this." The trial court asked, "Does the fact PG&E deferred to its contractors to assure their employees were qualified amount to clear and convincing proof (1) PG&E was aware of the probable dangerous consequences of its conduct, and (2) deliberately failed to avoid those consequences?" The trial court concluded, "The court is not prepared to hold no reasonable jury could so find." Accordingly, the trial court denied PG&E’s motion for summary adjudication.

D. The Petition for Writ of Mandate

PG&E filed a petition for writ of mandate, prohibition, or other relief, challenging the trial court’s denial of summary adjudication as to the request for punitive damages. We reviewed PG&E’s petition and supporting papers and issued an order to show cause.⁴

II. DISCUSSION

PG&E contends the trial court erred in denying the motion for summary adjudication of plaintiffs’ request for punitive damages under section 3294. We agree.

A. Standard of Review

"An order denying a motion for summary adjudication may be reviewed by way of a petition for writ of mandate. [Citation.] Where the trial court’s denial of a motion for summary judgment will result in trial on non-actionable claims, a writ of mandate will issue. [Citations.] Likewise, a writ of mandate may issue to prevent trial of nonactionable claims after the erroneous denial of a motion for summary adjudication. [¶] Since a...