Hardy v. Superior Court (Pacific Ocean Popeye, Inc.)

• Decision Date: 18 January 1991
• Docket Number: No. B048478,B048478
• Citation: 226 Cal.App.3d 1418,277 Cal.Rptr. 633
• Parties: Previously published at 226 Cal.App.3d 1418 226 Cal.App.3d 1418 Lionel HARDY, Petitioner, v. The SUPERIOR COURT of Los Angeles County, Respondent, PACIFIC OCEAN POPEYE, INC., etc., Real Party in Interest.
• Court: California Court of Appeals Court of Appeals

Page 633

277 Cal.Rptr. 633

Previously published at 226 Cal.App.3d 1418

226 Cal.App.3d 1418

Lionel HARDY, Petitioner, v. The SUPERIOR COURT of Los Angeles County, Respondent PACIFIC OCEAN POPEYE, INC., etc., Real Party in Interest.

No. B048478.

Court of Appeal, Second District, Division 4, California.

Jan. 18, 1991.

As Modified Jan. 28, 1991.

Review Granted March 14, 1991.

Review Dismissed July 11, 1991.

Rene Korper, Hollywood, for petitioner.

De Witt W. Clinton, County Counsel, and Frederick R. Bennett, Asst. County Counsel, for respondent.

No appearance for real party in interest.

ARLEIGH M. WOODS, Presiding Justice.

The question presented in this mandate proceeding is whether section 396 of the Code of Civil Procedure ¹ authorizes a superior court judge to divest that court of its subject-matter jurisdiction over an action by a pretrial "fact-based" finding that the plaintiff's claim could not yield a judgment meeting the court's amount-in-controversy jurisdictional minimum.

We conclude that section 396 confers no such authority and that the decision in Campbell v. Superior Court (1989) 213 Cal.App.3d 147, 261 Cal.Rptr. 509, holding otherwise, is incorrectly decided. In our view section 396 makes the operative complaint or petition determinative of superior court subject-matter jurisdiction. Section 396 does not provide for evidentiary jurisdictional hearings and the fifth paragraph thereof exempts the superior court from the general rule that jurisdiction may be divested by a failure of proof "at the trial or hearing."

FACTS

By complaint filed in superior court, plaintiff alleges that he suffered extensive physical and emotional injuries, when, after consuming a substantial portion of the fried chicken he had purchased at defendant's restaurant, he discovered that it was a dead rat that had been coated with batter and deep-fried. This discovery caused plaintiff severe emotional distress, a chronic aversion to meat and other foods, and chronic emotional anxiety leading to physical disability and loss of employment. Plaintiff's statement of personal injury damages (Code Civ.Proc., §§ 425.10 and 425.11) claims $50,000 in general damages. ² A jury trial was demanded.

At a status conference respondent ruled, based upon the status-conference questionnaires, that the case did not meet the amount-in-controversy jurisdiction of the superior court. The case was ordered transferred to municipal court.

DISCUSSION

Respondent's transfer of the underlying action was based upon Campbell v. Superior Court (1989) 213 Cal.App.3d 147, 261 Cal.Rptr. 509, which holds that superior court judges may conduct pretrial evidentiary "hearings" to determine the maximum monetary damages a plaintiff will be able to prove at trial. If it appears to the judge that the damages recoverable at trial will not meet the superior court's amount-in-controversy minimum, the judge may transfer the case to municipal court.

We disagree with Campbell, supra, on several grounds.

First, we believe Campbell's construction of section 396 is in direct conflict with our Supreme Court's construction of the statute and the long-established case-law rule, that superior court subject-matter jurisdiction is determined exclusively from the good-faith allegations of the complaint and is not affected by a subsequent failure of proof "at trial or hearing."

Second, we believe Campbell's construction of the fifth paragraph of section 396 gives insufficient consideration to the fundamental principle of subject-matter jurisdiction that a trial court may not exercise subject-matter jurisdiction over a case after determining that it lacks such jurisdiction. It also ignores the system of trial court jurisdiction created by the California Constitution which does not provide for concurrent jurisdiction between superior and municipal courts.

Third, Campbell attributes a meaning to the term "or hearing," in the second paragraph of section 396, that is inconsistent with and unsupported by the legislative history of the statute.

Fourth, we view Campbell as improperly transforming the "amount in controversy" test of subject-matter jurisdiction into an "actual value of the action" test.

Fifth, we find Campbell construes section 396 in a manner that unnecessarily impinges upon the constitutional right of civil litigants to have a jury determine the amount of personal injury damages.

Sixth, we believe that Campbell incorrectly transforms the test stated in the second paragraph of section 396 (requiring transfer where "... the determination of the action or proceeding, ... will necessarily involve the determination of questions not within the jurisdiction of the court, ..."), into a pretrial subjective valuation by a judge.

The holding of Campbell v. Superior Court, supra, 213 Cal.App.3d 147, 261 Cal.Rptr. 509, turns on its construction of the second and fifth paragraphs of section 396.

Campbell interprets the "at trial, or hearing" language in the statute's second paragraph, as authorizing superior court judges to conduct "other hearings" (i.e., hearings preceding the ultimate trial on the merits) to evaluate the maximum monetary damages that could reasonably be awarded by a jury or court after trial. Campbell concludes that if it "appears to" a judge that this maximum amount does not meet the superior court's jurisdictional minimum, then the judge may order transfer to municipal court and preclude a superior court jury from fixing damages.

Campbell, supra, 213 Cal.App.3d at page 151, 261 Cal.Rptr. 509, acknowledges the established "general rule" that amount-in-controversy subject-matter jurisdiction of the superior court is determined by the good-faith allegations and prayer of the complaint. However, it views the second paragraph of section 396 as contemplating post-complaint, fact-based divestments of such jurisdiction "at the trial or other hearing." From this Campbell concludes that the superior court's subject-matter jurisdiction, initially fixed by the good-faith allegations in the complaint or petition, is subject to divestment upon a pretrial factual valuation of the true maximum worth of the action. (213 Cal.App.3d at pp. 151-152, 261 Cal.Rptr. 509.)

Campbell holds that such divestment of jurisdiction by failure of proof "as determined at trial or hearing" is not precluded by the language of the fifth paragraph of section 396 because the phrase "Nothing herein shall be construed to require the superior court to transfer ..." merely creates "discretion" in that court to retain the action for hearing, determination and entry of judgment. (Campbell v. Superior Court, supra, 213 Cal.App.3d at p. 152, fn. 2, 261 Cal.Rptr. 509, emphasis added.)

Campbell attempts to reconcile its statutory construction with two contrary decisions (Davis v. Superior Court (1972) 25 Cal.App.3d 596, 599-601, 102 Cal.Rptr. 238, and Depretto v. Superior Court (1981) 116 Cal.App.3d 36, 39, 171 Cal.Rptr. 810) that follow the settled rule that the allegations and prayer of the complaint exclusively determine superior court amount-in-controversy jurisdiction and that jurisdiction is not affected by a subsequent failure of proof.

Campbell reasons: "Both opinions [Davis, supra, and Depretto, supra ] resolve the transfer issue by reciting the general rule, without delving into the meaning of the statutory language permitting a fact-based transfer, and without discussion of the permissibility of the transfer in the case before the court. Indeed, both decisions imply, contrary to the statutory language, that a trial court cannot transfer a case which prays for superior court damages regardless of the actual value as assessed at a trial or hearing. We must disagree with any such implication; under the language of section 396 the trial court may, in its discretion and under appropriate circumstances, evaluate the facts of a case and determine that a verdict within the limits of superior court jurisdiction will not be had." (Campbell v. Superior Court, supra, 213 Cal.App.3d at p. 152, 261 Cal.Rptr. 509, fns. omitted.)

The Campbell construction of the fifth paragraph of section 396, as permitting divestment of superior court jurisdiction upon failure of proof "as determined at trial or hearing," is contrary to the construction given to section 396 by our Supreme Court. (Sellery v. Ward (1942) 21 Cal.2d 300, 304-306, 131 P.2d 550; Silverman v. Greenberg (1938) 12 Cal.2d 252, 254, 83 P.2d 293.)

A comparison of the cases decided before and after the 1933 amendment of section 396 (substituting provisions controlling subject-matter jurisdiction in place of the territorial-jurisdiction and venue provisions previously contained in that section) demonstrates that section 396 has, since that amendment, uniformly been construed by our Supreme Court to continue in effect or codify the preexisting case-law rule. Nothing in these cases suggests the statute was intended to drastically alter the case-law rule.

The settled case-law rule from 1855 to 1933 was that superior court amount-in-controversy and nature-of-the-case subject-matter jurisdiction ³ lies exclusively in the good-faith allegations of the operative complaint or petition and is not subject to divestment upon failure of proof at trial. (Jackson v. Whartenby (1855) 5 Cal. 94, 94-95; Dashiell v. Slingerland (1882) 60 Cal. 653, 655; Rodley v. Curry (1898) 120 Cal. 541, 542-543, 52 P. 999; Becker v. Superior Court (1907) 151 Cal. 313, 316-318, 90 P. 689; Gardiner v. Royer (1914) 167 Cal. 238, 244, 139 P. 75.)

Jackson v. Whartenby, supra, 5 Cal. at pages 94-95, involved a challenge to trial court jurisdiction where the damages proved at trial fell below the minimum amount-in-dispute specified for jurisdiction. Jackson affirmed the judgment, holding: "Section 6 of the sixth Article of the Constitution [former California Constitution], provides that 'the District Courts [the trial-court predecessors of superior courts] shall have...