Bank of San Pedro v. Superior Court

• Decision Date: 26 October 1992
• Docket Number: No. S022569,S022569
• Citation: 838 P.2d 218,12 Cal.Rptr.2d 696,3 Cal.4th 797
• Court: California Supreme Court
• Parties: , 838 P.2d 218 BANK OF SAN PEDRO, Petitioner, v. The SUPERIOR COURT of Los Angeles County, Respondent. Wallace A. GOODSTEIN, Real Party in Interest.

Page 696

12 Cal.Rptr.2d 696

3 Cal.4th 797, 838 P.2d 218

BANK OF SAN PEDRO, Petitioner, v. The SUPERIOR COURT of Los Angeles County, Respondent Wallace A. GOODSTEIN, Real Party in Interest.

No. S022569.

Supreme Court of California In Bank.

Oct. 26, 1992.

Epport & Richman and Steven N. Richman, Los Angeles, for petitioner.

No appearance for respondent.

Smith, Polson & Elstead, Edward W. Polson and John Clifton Elstead, Pleasanton, for real party in interest.

BAXTER, Justice.

Plaintiff in this action recovered nothing, and judgment was entered in defendant's favor. The judgment awarded defendant expert witness fees pursuant to Code of Civil Procedure section 998, subdivision (c). The sole issue in this case is whether enforcement of the award of expert witness fees is automatically stayed by operation of law while the judgment is being appealed by plaintiff. We hold such a judgment is not automatically stayed and that the appellant must post an appeal bond or other sufficient undertaking to obtain a stay pending appeal.

FACTS

The relevant facts are not disputed. Real party in interest Wallace A. Goodstein, M.D. (Goodstein) sued petitioner Bank of San Pedro (the Bank). The Bank served Goodstein with an offer to compromise the action pursuant to Code of Civil Procedure section 998. ¹ The offer was rejected by Goodstein's failure to accept it within the statutory period.

Trial resulted in a nonsuit in the Bank's favor. (Goodstein's appeal from the nonsuit is pending.) The Bank moved to recover its expert witness fees based on Goodstein's rejection of the Bank's section 998 offer and his failure to obtain a judgment more favorable than the offer. The trial court awarded the Bank its expert witness fees in the requested amount of $116,184.05 pursuant to section 998, subdivision (c) and additional costs of $22,237.62 pursuant to sections 998, subdivision (c), 1032, and 1033.5.

Goodstein appealed from the order awarding expert witness fees, but Goodstein did not file an appeal bond or other undertaking. The Bank moved the trial court for an order directing the court clerk to issue a writ of execution and abstract of judgment allowing the Bank to collect its award of expert witness fees in the amount of $116,184.05. (The Bank did not seek to enforce the portion of the judgment for $22,237.62 of other costs.) Goodstein opposed the motion on the ground that enforcement of the judgment was automatically stayed by his appeal of the order awarding costs under section 998. The trial court denied the Bank's motion.

The Court of Appeal granted the Bank's petition for writ of mandamus, concluding that the expert witness fees awarded under section 998 are extraordinary costs and that a judgment for such costs is not automatically stayed pending appeal.

DISCUSSION

1. Statutory language

The question before us is governed by statutes. Our task is to determine the Legislature's intent. (Brown v. Kelly Broadcasting Co. (1989) 48 Cal.3d 711, 724, 257 Cal.Rptr. 708, 771 P.2d 406; Adoption of Kelsey S. (1992) 1 Cal.4th 816, 826, 4 Cal.Rptr.2d 615, 823 P.2d 1216.) "We must begin with the words of the statute." (See Kelsey S., supra, at p. 826, 4 Cal.Rptr.2d 615, 823 P.2d 1216; Delaney v. Superior Court (1990) 50 Cal.3d 785, 798, 268 Cal.Rptr. 753, 789 P.2d 934.) Section 916, subdivision (a) states, "Except as provided in Sections 917.1 to 917.9, inclusive, and in Section 116.810, the perfecting of an appeal stays proceedings in the trial court upon the judgment or order appealed from or upon the matters embraced therein or affected thereby, including enforcement of the judgment or order...." Perhaps the most common (and thus most significant) of the specified exceptions to the statutory automatic stay is set forth in section 917.1, subdivision (a) which states, "The perfecting of an appeal shall not stay enforcement of the judgment or order in the trial court if the judgment or order is for money or directs the payment of money, whether consisting of a special fund or not, and whether payable by the appellant or another party to the action, unless an undertaking is given." (Italics added.) The question in this case is whether the order awarding expert witness fees under section 998, subdivision (c) is an order that "directs the payment of money" within the meaning of section 917.1, subdivision (a).

On its face the order directs the payment of money--$116,184.05--by plaintiff to defendant, and is therefore within the literal language of section 917.1, subdivision (a). That would seem to be the end of the matter, and as we shall explain, that is ultimately the correct result. The problem, however, is not so simple because the language, "directs the payment of money," must be read in statutory context and in light of long-standing judicial construction of this language.

2. Our prior decisions

Costs of suit are awarded to the prevailing party in nearly every civil action or proceeding. This reality arises from section 1032, subdivision (b), which states, "Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding." (Italics added.) We relied on this circumstance in construing the statutory antecedent of section 917.1 (former section 942): "A judgment for costs is not the judgment directing the payment of money contemplated by section 942. If such were the fact, a stay bond would be required in almost every conceivable case, when, to the contrary, it is only required in the four cases covered by sections 942 to 945 of the code [of Civil Procedure]." (McCallion v. Hibernia etc. Society (1893) 98 Cal. 442, 445, 33 P. 329.) In other words, if a judgment for costs awarded under section 1032 were a money judgment within the meaning of section 917.1, virtually every judgment would be within the scope of section 917.1, and an undertaking would be required to stay every judgment pending appeal. The exception in section 917.1 to the automatic stay provision of section 916 would cease to be an exception; it would subsume the general rule. Such a result could not have been consistent with the Legislature's intent. We therefore have held that a judgment for costs alone was not a judgment directing the payment of money within the meaning of former section 942 (now section 917.1, subdivision (a)) and was therefore stayed without the need for an undertaking. (Imperial Beverage Co. v. Superior Court (1944) 24 Cal.2d 627, 631, 150 P.2d 881; McCallion v. Hibernia etc. Society, supra, 98 Cal. 442, 445, 33 P. 329.) This rule has become well established. (See, e.g., Vadas v. Sosnowski (1989) 210 Cal.App.3d 471, 473, 258 Cal.Rptr. 374.) ²

In each of our decisions, however, the costs were of a routine nature, such as those awarded as a matter of right under section 1032. Not equally clear is whether the rule subjecting a judgment for costs alone to the automatic statutory stay on appeal extends to judgments, like the one in this case, in which the costs were not limited to the routine costs awarded under sections 1032 and 1033.5, but instead included an award of expert witness fees under section 998.

3. Court of Appeal decisions

No court has squarely decided the issue, but prior decisions illuminate the nature of the question. In Chamberlin v. Dale's R.V. Rentals, Inc. (1986) 188 Cal.App.3d 356, 232 Cal.Rptr. 785, the Court of Appeal was faced with a judgment for damages and costs, which included an award of attorney fees pursuant to Civil Code section 1717. ³ Because the case was decided before the 1986 amendment to section 917.1 (which requires the inclusion of costs in a damages judgment when computing the amount of the undertaking), the question was whether the award of attorney fees under Civil Code section 1717 had to be included within the judgment in computing the amount of the undertaking. The court concluded the then-existing rule that costs were not included for such purpose did not extend to the award of attorney fees. "Unlike the costs involved in the early cases, such attorney fees are in the nature of a directly litigated issue rather than merely incidental to the judgment. Further, attorney fees are not the type of costs involved in virtually every case. Attorney fees are awarded only in limited situations." (Chamberlin, supra, 188 Cal.App.3d at p. 362, 232 Cal.Rptr. 785.) A different Court of Appeal, however, subsequently held that where a party recovers no money damages but only a judgment for costs, including an award of attorney fees under Civil Code section 1717, no undertaking is required for a stay of judgment on appeal. (Nielsen v. Stumbos (1990) 226 Cal.App.3d 301, 305, 276 Cal.Rptr. 272.)

In the present case, the trial court relied primarily on Vadas v. Sosnowski, supra, 210 Cal.App.3d 471, 473-474, 258 Cal.Rptr. 374 (Vadas ), for that decision's reaffirmation of the rule that a judgment for only costs remains subject to the statutory automatic stay of section 916. (Imperial Beverage Co. v. Superior Court, supra, 24 Cal.2d 627, 631, 150 P.2d 881.) The Court of Appeal in this case, however, held that Vadas, supra, 210 Cal.App.3d 471, 258 Cal.Rptr. 374, which involved only routine costs, is distinguishable from the present case. The Court of Appeal relied instead on Chamberlin v. Dale's R.V. Rentals, Inc., supra, 188 Cal.App.3d 356, 232 Cal.Rptr. 785, for the principle that nonroutine costs must be treated differently from routine costs. The Court of Appeal further concluded that expert witness fees awarded under section 998, subdivision (c) are not routine costs. We agree with both conclusions.

4. No automatic stay

Our decisions holding that a judgment awarding no monetary recovery other than routine costs was subject to the automatic stay of section 916 were clear as to their premise. Because routine costs are awarded in virtually all cases, if we were to conclude that a judgment for costs is necessarily a...