Castro v. Higaki

• Citation: 37 Cal.Rptr.2d 84,31 Cal.App.4th 350
• Decision Date: 06 December 1994
• Docket Number: No. A062161,A062161
• Court: California Court of Appeals
• Parties: Pamela CASTRO, Plaintiff and Appellant, v. Paul F. HIGAKI, Jr., et al., Defendants and Respondents.

Page 84

37 Cal.Rptr.2d 84

31 Cal.App.4th 350

Pamela CASTRO, Plaintiff and Appellant, v. Paul F. HIGAKI, Jr., et al., Defendants and Respondents.

No. A062161.

Court of Appeal, First District, Division 2, California.

Dec. 6, 1994.

Review Denied Feb. 22, 1995.

Roth & Russo, David L. Roth, Oakland, for plaintiff and appellant.

Travis & Pon, Jane G. Pon and Monte S. Travis, San Francisco, for defendant and respondent.

Introduction

KLINE, Presiding Justice.

Appellant Pamela Castro appeals from judgments of the San Francisco Superior Court dismissing her action against respondents. She contends the trial court erred in sustaining respondent Paul Higaki's ¹ demurrer on the ground the action was precluded by res judicata. She claims that the issue determined in the previous action is not the same as the issue presented in the current action and that a statutory amendment now frees her from the previous judgment. We disagree and shall affirm.

Facts and Procedural History

Appellant filed a personal injury action on August 24, 1987 against Peter Pilaski for injuries sustained by her in a bombing. (Castro v. Pilaski ) ² Pilaski was convicted of masterminding the bombing on December 23, 1987, and sentenced to federal prison. Respondent Higaki served as assistant defense counsel to Pilaski in his criminal trial. On March 30, 1989, respondent firm Morris & Massino (which later became respondent Morris, Taylor, Hays & Higaki), became counsel of record for Pilaski in the personal injury case. The personal injury case resulted in a judgment against Pilaski of $490,083.91 on June 3, 1991.

While the appeal in Castro v. Pilaski was pending, appellant filed a petition pursuant to Civil Code section 1714.10 ³ for leave to file a complaint for conspiracy against Pilaski's attorneys, including respondents, alleging they had conspired to transfer Pilaski's assets overseas during the period before respondent Morris & Massino became counsel of record in the personal injury case. ("Castro I") ⁴

Judge Saldamando heard the petition on June 26, 1991 and denied it on September 24, 1991. This denial was an appealable order. (See p. 87, infra.) Appellant filed a motion for reconsideration on October 2, 1991 which was denied on December 2, 1991. Appellant then appealed from the order denying the motion for reconsideration on January 24, 1992. Respondent Higaki moved to dismiss the appeal on the grounds that the order denying the motion for reconsideration was a nonappealable order and that appellant had not prosecuted the appeal with diligence. We granted the motion and dismissed the purported appeal on November 25, 1992.

Appellant filed the complaint in the present action on May 1, 1992, while the appeal from Castro I was still pending. It is virtually identical to the proposed complaint in Castro I. Appellant claimed that because section 1714.10 had been amended effective January 1, 1992, to require a petition only when alleging conspiracy between an attorney and client "arising from any attempt to contest or compromise a claim or dispute, and which is based upon the attorney's representation of the client," she was no longer required to go through the petition process as the alleged conspiracy occurred before respondents entered into the personal injury case as attorneys of record. Respondent Higaki demurred and moved to strike the new complaint. He argued that appellant was attempting to split her cause of action because she was raising the same issue as in Castro I which was then on appeal, and that she had failed to state a cause of action. Judge McCabe sustained the demurrer without leave to amend on August 27, 1992, on the ground appellant was attempting to split her cause of action.

Appellant filed a motion to set aside the order sustaining the demurrer under Code of Civil Procedure section 473, claiming that the demurrer had been sustained only because appellant mistakenly believed the Court of Appeal had jurisdiction to consider the appeal in Castro I, including the impact of the amendment of section 1714.10. Respondent Higaki opposed the motion contending the demurrer was sustained because the same primary right was being asserted in both actions, not because of mistake. Appellant contended in her reply that she had never had her primary right adjudicated, and that the only matter adjudicated in Castro I was that she had not demonstrated a reasonable probability of prevailing. Judge McCabe denied the motion and dismissed the case, stating "the final determination of [Castro I ] is res judicata as to this action." Judgment was entered in respondent Higaki's favor on April 28, 1993. Judgment was entered as to the other respondents on August 23, 1993 pursuant to a stipulation between all parties. Appellant timely appeals from the judgments.

Discussion

When reviewing an order sustaining a demurrer without leave to amend, we must assume as true all facts properly pleaded by appellant. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318, 216 Cal.Rptr. 718, 703 P.2d 58.) If the complaint shows entitlement to relief under any possible legal theory, the trial court erred in dismissing the action. (Platt v. Coldwell Banker Residential Real Estate Services (1990) 217 Cal.App.3d 1439, 1444, 266 Cal.Rptr. 601.)

Appellant contends that the trial court erred when it sustained the demurrer because the judgment in Castro I is not res judicata as to the present action. She claims the only issue determined in Castro I was whether or not she had a reasonable probability of prevailing, and that consequently she has never had the merits of her claim adjudicated.

The Legislature enacted section 1714.10 to eliminate frivolous allegations of conspiracy between attorneys and clients. ⁵ (Hung v. Wang, supra, 8 Cal.App.4th 908, 931, 11 Cal.Rptr.2d 113; see also, College Hospital, Inc. v. Superior Court (Crowell et al.) (1994) 8 Cal.4th 704, 718, 34 Cal.Rptr.2d 898, 882 P.2d 894.) When appellant originally filed her petition in Castro I, section 1714.10 provided in pertinent part "no cause of action against an attorney based upon a civil conspiracy with his or her client shall be included in a complaint or other pleading unless the court enters an order allowing the pleading that includes a claim for civil conspiracy to be filed after the court determines that the party seeking to file the pleading has established that there is a reasonable probability that the party will prevail in the action."

An adjudication of a petition under section 1714.10 results in a final, appealable order. (Hung v. Wang, supra, Cal.App.4th at p. 935, 11 Cal.Rptr.2d 113.) After appellant's petition was denied, her motion for reconsideration was denied, and her attempted appeal from the denial of the reconsideration was dismissed. Appellant had 60 days from notice of the ruling on the petition in which to file her appeal from the order adjudicating the 1714.10 petition, and when that time had passed, the judgment resulting from the order became final. ⁶ (Cal.Rules of Court, rules 2(a) and 2(d).)

The question thus becomes whether the same primary right was being raised by appellant in Castro I as is raised in this action and whether the final judgment denying the petition was on the merits and hence res judicata to the instant action. Res judicata is a well-established doctrine. "A valid final judgment on the merits in favor of a defendant serves as a complete bar to further litigation on the same cause of action." (Slater v. Blackwood (1975) 15 Cal.3d 791, 795, 126 Cal.Rptr. 225, 543 P.2d 593; see also De Weese v. Unick (1980) 102 Cal.App.3d 100, 105, 162 Cal.Rptr. 259; Shuffer v. Board of Trustees (1977) 67 Cal.App.3d 208, 216, 136 Cal.Rptr. 527.) The doctrine is also expressed statutorily in Code of Civil Procedure section 1908. ⁷ Res judicata gives conclusive effect to a previous judgment in subsequent litigation on the same controversy. (7 Witkin, Cal.Procedure (3d ed. 1985) Judgment, § 188 at p. 621.) "It seeks to curtail multiple litigation causing vexation and expense to the parties and wasted effort and expense in judicial administration." (Ibid., emphasis in original.)

In California, the "primary rights" theory determines the scope of a party's cause of action. (Craig v. County of Los Angeles (1990) 221 Cal.App.3d 1294, 1301, 271 Cal.Rptr. 82.) The primary right is determined by the harm suffered, regardless of the number of legal theories asserted. (Wulfjen v. Dolton (1944) 24 Cal.2d 891, 894, 151 P.2d 846.) Because the complaint in this action is virtually identical to the proposed complaint in the previous action, it is based on the same primary right, and therefore the same cause of action.

Whether the denial of appellant's petition under section 1714.10 is a judgment on the merits appears to be a novel question. In Hung v. Wang, supra, which upheld the constitutionality of the section 1714.10 petition process, the court explained that in ruling on the petition, the judge must determine "whether the proposed pleading is legally sufficient, and whether it is supported by a sufficient prima facie showing of facts to sustain a favorable decision if the evidence submitted by the petitioner is credited. If either of these requirements is not met, the petition must be denied; if both are satisfied, it must be granted." (Id., 8 Cal.App.4th at p. 931, 11 Cal.Rptr.2d 113.) ⁸ The court compared the requirement under section 1714.10 to the showing required of a plaintiff responding to a motion for summary judgment under the Federal Rules of Civil Procedure. (Fed.Rules Civ.Proc., rule 56(c), 28 U.S.C.A.) (Ibid.) Federal summary judgment is granted where there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. (Hubicki v. ACF Industries, Inc. (1973) 484 F.2d 519, 524.) "It is clear that the granting of a motion for summary judgment is a final determination on the merits." (Citibank, N.A. v. Graphic Scanning...