Kelley v. Bredelis

• Decision Date: 04 June 1996
• Docket Number: No. E012476,E012476
• Citation: 53 Cal.Rptr.2d 536,45 Cal.App.4th 1819
• Court: California Court of Appeals Court of Appeals
• Parties: , 96 Cal. Daily Op. Serv. 4030, 96 Daily Journal D.A.R. 6477 Jack E. KELLEY, Jr., et al., Plaintiffs and Appellants, v. Jean BREDELIS, Defendant and Respondent.

Page 536

53 Cal.Rptr.2d 536

45 Cal.App.4th 1819, 96 Cal. Daily Op. Serv. 4030,

96 Daily Journal D.A.R. 6477

Jack E. KELLEY, Jr., et al., Plaintiffs and Appellants, v. Jean BREDELIS, Defendant and Respondent.

No. E012476.

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

June 4, 1996.

Rehearing Denied June 24, 1996.

Review Denied Aug. 28, 1996.

[45 Cal.App.4th 1822] Mannerino & Briguglio, Ranch Cucamnga, and Mitchell I. Roth, Claremont, for Plaintiffs and Appellants.

Donald F. Zimmer, Riverside, for Defendant and Respondent.

OPINION

HOLLENHORST, Acting Presiding Justice.

After an unfavorable award at a judicial arbitration, the plaintiffs, Jack E. Kelley, Jr. and Jeanette Bailey-Kelley, requested a trial de novo, but later voluntarily dismissed their action with prejudice. The trial court vacated the dismissal, reinstated the arbitration award, and entered judgment against the plaintiffs pursuant to that award. Concluding that the trial court's order is both appealable and correct, we affirm.

PROCEDURAL BACKGROUND AND FACTS

On March 14, 1990, plaintiffs, the daughter and son-in-law of defendant Jean Bredelis, filed suit against her for damages for breach of contract and specific performance of an alleged written lease and option contract concerning defendant's home. The lease contained the following attorney fee provision: "Should any litigation be commenced between the parties hereto concerning the demised premises, this lease, or the rights and duties of either in relation thereto, the party, Lessee or Lessor, prevailing in such litigation shall be entitled, in addition to such other relief as may be granted, to a reasonable sum as and for his attorney's fees in such litigation."

On August 29, 1990, defendant filed her verified answer to the complaint. In her answer, defendant alleged that the contract had been modified prior to execution to eliminate the option to purchase and to substitute a provision enabling defendant to elect not to sell the property. However, if defendant failed to sell the property, she had an obligation to return 10 percent of the rent paid under the lease.

The case was assigned to judicial arbitration by mutual agreement of the parties. The arbitration hearing was scheduled for March 5, 1991. Both parties and their counsel participated in the arbitration. Plaintiffs' position in the arbitration was that the lease was valid and that the purchase option had been timely exercised. Defendant contended that the lease did not contain a valid option to purchase, and that she therefore had no obligation to sell the property to plaintiffs. On March 7, 1991, the arbitrator issued his award in favor of defendant, awarding her attorney fees and costs, except for an offset of $2,400 in favor of plaintiffs, representing a return of the rent which was due by virtue of defendant's election not to proceed with the sale of the subject property.

On March 13, 1991, plaintiffs filed and served their request for trial de novo pursuant to Code of Civil Procedure section 1141.20 ¹ and California Rules of Court, rule 1616(a). ² Plaintiffs then filed an at-issue memorandum and trial was initially set for November 4, 1991. The trial date was continued to February 4, 1992. Pursuant to stipulation of both parties and their counsel, the trial was again continued to May 26, 1992. However, on May 11, 1992, approximately two weeks before the trial date, plaintiffs filed a request for dismissal with prejudice.

Thereafter, defendant filed a memorandum of costs, motion for attorney fees, and motion for an order vacating the plaintiffs' request for trial de novo and entering judgment on the arbitration award. The trial court granted defendant's motions, entered judgment on the arbitration award, and subsequently set the amount of attorney fees recoverable by defendant at $21,500. Plaintiffs appeal from that judgment.

IS THE JUDGMENT APPEALABLE?

Defendant contends that this appeal should be dismissed because it has been taken from a nonappealable judgment.

If no party requests a trial de novo within 30 days of the filing of the award by the arbitrator, the clerk of the court "shall enter the award as a judgment forthwith...." (Rule 1615(c); and see § 1141.23.) "The judgment so entered shall have the same force and effect in all respects as, and is subject to all provisions of law relating to, a judgment in civil action or proceeding, except that it is not subject to appeal ...." (Rule 1615(c); accord, § 1141.23, emphasis added.)

Here, the arbitrator specifically determined that the defendant should recover her attorney fees as the prevailing party, but did not determine the amount of those fees. The plaintiffs, however, do not contest the reasonableness of the fees awarded. Instead, they contend that the defendant is not statutorily entitled to recover attorney fees in any amount.

In Dickens v. Lee (1991) 230 Cal.App.3d 985, 281 Cal.Rptr. 783, the court held that "where a judicial arbitrator awarded a specific amount of attorney fees but unspecified costs, a judgment on the award was appealable as to the costs but not as to the attorney fees, which could be challenged only by request for trial de novo." (Id., at p. 986, 281 Cal.Rptr. 783.) In that case, as in this, the tenants challenged the award of attorney fees. The court held that those issues were not properly before the court because they were nonappealable. (Id., at p. 987, 281 Cal.Rptr. 783.) "The only exception [to the rule of nonappealability] is where the arbitrator's award does not specify the amount of recoverable costs. In such a case there can be no request for a trial de novo as to costs, since the court determines costs in the first instance, and thus the portion of the court's judgment awarding costs must be appealable, because otherwise there would be no opportunity for appellate review." (Ibid.) In other words, the award of the arbitrator was nonappealable, but the subsequent award of costs by the trial court was appealable. We are thus confined to a review of the actions of the trial court.

Since the trial court granted defendant's motion for entry of judgment on the arbitration award and set the amount of the attorney fees awarded by the arbitrator, we consider whether the trial court erred in doing so.

DID THE TRIAL COURT ERR IN GRANTING DEFENDANT'S MOTION TO VACATE PLAINTIFFS' REQUEST FOR TRIAL DE NOVO?

Following plaintiffs' request for dismissal, defendant moved to vacate plaintiffs' request for trial de novo, to enter judgment on the arbitration award, and to set the amount of her attorney fees. In support of her motions, defendant argued that as the prevailing party on the arbitration award she was entitled to her attorney fees. Citing Herbert Hawkins Realtors, Inc. v. Milheiser (1983) 140 Cal.App.3d 334, 189 Cal.Rptr. 450, she contended that plaintiffs' voluntary dismissal of their action following their request for trial de novo amounted to a repudiation of their previous election for trial de novo. The trial court agreed and so do we.

In Herbert Hawkins, plaintiffs requested a trial de novo after receiving a judicial arbitration award in favor of defendants. Plaintiffs then voluntarily dismissed their breach of contract action without prejudice. Defendants moved for an order of dismissal with prejudice and awarding costs. The trial court denied defendants' motion and the appellate court reversed. The sole issue before the appellate court was whether plaintiffs were "entitled to voluntarily dismiss their breach of contract action without prejudice after having requested a trial de novo following a judicial arbitration award favoring defendants." (Herbert Hawkins Realtors v. Milheiser, supra, 140 Cal.App.3d 334, 336, 189 Cal.Rptr. 450.) In deciding this issue, the court began with an examination of the statutory provisions governing dismissals and judicial arbitration.

In response to the demand for efficient resolution of small civil claims, the Legislature enacted the Judicial Arbitration Act (see ch. 2.5, §§ 1141.10, 1141.20 added by Stats.1975, ch. 1006, § 1, p. 2364) and "expressly declared arbitration hearings be simple, economical, informal and private in procedural character to insure prompt and equitable dispute resolution." (Herbert Hawkins Realtors v. Milheiser, supra, 140 Cal.App.3d 334, 338, 189 Cal.Rptr. 450; § 1141.10, subds. (b)(1) and (2).) Acknowledging that article I, section 16 of the California Constitution gives every party the right to trial by jury, the Legislature also provided the means by which a party, dissatisfied with the arbitration award, could elect to have a trial de novo. (§ 1141.20; rules 1615(c) and 1616(a).) However, absent a request, the arbitration award is final. (§ 1141.20.)

Coexistent with the statutes providing for judicial arbitrations is section 581, which allows a plaintiff to dismiss his case at any time before the actual commencement of the trial. As the court noted, this right to voluntary dismissal appears to be absolute. However, recognizing its "statutory duty to construe each provision of the Code of Civil Procedure liberally and with a view to effect its objects and promote justice. [Citation.]" (Justus v. Atchison (1977) 19 Cal.3d 564, 579, 139 Cal.Rptr. 97, 565 P.2d 122, overruled on other grounds Ochoa v. Superior Court (1985) 39 Cal.3d 159, 171, 216 Cal.Rptr. 661, 703 P.2d 1), the court found that "permitting [plaintiffs] to voluntarily dismiss without prejudice defeats the express legislative purpose of 'expediting and removing complexities from the judicial process relating to small civil claims....' [Citation.] Such a construction of the interrelationship of the relevant statutes produces absurd consequences and promotes mischievous lawyering. [p] No party has the right to avoid the judicial arbitration award at their whim, and the party requesting a trial de novo may either proceed with a trial de novo or allow the award to be entered as a...