Lyons v. Wickhorst

• Decision Date: 01 December 1986
• Citation: 231 Cal.Rptr. 738,727 P.2d 1019,42 Cal.3d 911
• Court: California Supreme Court
• Parties: , 727 P.2d 1019 Edward J. LYONS, Plaintiff and Appellant, v. Erwin WICKHORST et al., Defendants and Respondents. L.A. 31991.

Page 738

231 Cal.Rptr. 738

42 Cal.3d 911, 727 P.2d 1019

Edward J. LYONS, Plaintiff and Appellant, v. Erwin WICKHORST et al., Defendants and Respondents.

L.A. 31991.

Supreme Court of California In Bank.

Dec. 1, 1986.

Edward J. Lyons, in pro. per.

Edward Tabash, Beverly Hills, for plaintiff and appellant.

Patricia F. Clothier, Torrance, for defendants and respondents.

BIRD, Chief Justice.

Does a trial court exceed its authority when it dismisses a plaintiff's action with prejudice because no evidence was presented at a court-ordered arbitration?

I.

In June of 1980, appellant Edward Lyons filed a lawsuit against respondent Erwin Wickhorst seeking actual, compensatory, and punitive damages for unlawful arrest and false imprisonment. ¹ Since appellant did not seek damages in excess of $25,000, the trial court ordered mandatory arbitration pursuant to Code of Civil Procedure section 1141.11. ²

The first arbitration hearing was set for November of 1982. Immediately prior to the arbitration, appellant informed the arbitrator and counsel for respondent that he did not intend to present any evidence in support of his case. In response, respondent made no attempt to refute appellant's claims. Thus, no evidence was introduced at the first hearing.

The superior court appointed a new arbitrator and set a new hearing for June of 1983. During this second attempt at arbitration, appellant once again declined to present evidence. Respondents did not attend the hearing after informing the arbitrator that attendance would be futile in light of appellant's refusal to proceed.

Although no evidence was presented during either of the two hearings, the arbitrator entered an award in favor of respondents. On the same day that the award was entered, appellant requested a trial de novo pursuant to section 1141.20. ³ Upon motion by respondent, the court dismissed the action stating that appellant's refusal to offer any evidence at the court-ordered arbitration hearings "border[ed] on contempt," and was a "continuing and willful rejection of the whole arbitration program."

Appellant challenges the authority of the trial court to dismiss his action for failure to participate in the mandatory arbitration procedures.

II.

In dismissing appellant's action, the trial court relied in part on section 581 and the "Rules of Court Ordered Arbitration." Section 581 authorizes dismissal by the court in any of the following situations: (1) neither party appears at the trial following 30 days notice of time and place; (2) a demurrer is sustained without leave to amend; (3) the plaintiff abandons the case prior to final submission, or (4) either party fails to appear and the other party requests dismissal. None of these scenarios occurred in the present case.

Similarly, neither the judicial arbitration statutes (§§ 1141.10-1141.32) nor the rules of judicial arbitration (Cal.Rules of Court, rules 1600-1617) permit the courts to dismiss an action because of a plaintiff's failure to present evidence at a judicially mandated arbitration proceeding. A separate provision--section 128.5--authorizes a trial court to order a party to a judicial arbitration proceeding to pay "any reasonable expenses, including attorney's fees" which the opposing party incurs "as a result of bad-faith actions " or frivolous or delaying tactics in such a proceeding. Thus, the trial court's dismissal of appellant's action was not expressly authorized by statute.

In the absence of express statutory authority, a trial court may, under certain circumstances, invoke its limited, inherent discretionary power to dismiss claims with prejudice. (See 6 Witkin, Cal.Procedure (3d ed. 1985) Proceedings Without Trial, § 212, pp. 517-518.) However, this power has in the past been confined to two types of situations: (1) the plaintiff has failed to prosecute diligently (Romero v. Snyder (1914) 167 Cal. 216, 138 P. 1002); or (2) the complaint has been shown to be "fictitious or a sham" such that the plaintiff has no valid cause of action (Cunha v. Anglo California Nat. Bank (1939) 34 Cal.App.2d 383, 388, 93 P.2d 572). ⁴

The discretion to dismiss an action for lack of prosecution has recently been recodified in section 583.410. Section 583.410 permits the court to dismiss an action for lack of prosecution provided that one of several enumerated conditions has occurred. Generally, the court may not dismiss unless "(1) [s]ervice has not been made within two years after the action is commenced ... (2) [t]he action is not brought to trial within ... [t]hree years after [it] is commenced ... [or] (3) [a] new trial is granted and the action is not again brought to trial ... within two years...." (§ 583.420.)

As this court noted in Weeks v. Roberts (1968) 68 Cal.2d 802, 805, 69 Cal.Rptr. 305, 442 P.2d 361, this two-year statutory period was intended to "limit [ ] the court's independent power to dismiss an action for want of prosecution at any time." Thus, a minimum delay of two years is required before a trial court can exercise its discretionary dismissal powers. (See Hartman v. Gordon H. Ball, Inc. (1969) 269 Cal.App.2d 779, 75 Cal.Rptr. 618 [dismissal was improper under both the five-year and two-year periods and was therefore not justified as an exercise of the trial court's inherent power to dismiss]; see also Raggio v. Southern Pac. Co. (1919) 181 Cal. 472, 475, 185 P. 171; Tew v. Tew (1958) 160 Cal.App.2d 141, 144, 324 P.2d 625.) No such delay occurred in the present case. Similarly, no claims were made by respondents that appellant's complaint did not allege a sufficient basis upon which to plead a valid cause of action. Nor did the trial court state on the record that its order of dismissal was entered for this reason.

In those situations in which a dismissal pursuant to the court's discretionary power has been upheld, affirmance has not been without reservation. (See, e.g., Karras v. Western Title Ins. Co. (1969) 270 Cal.App.2d 753, 758, 76 Cal.Rptr. 141.) The courts have long recognized a policy favoring a trial on the merits. (Ibid.) As the courts of this state have stressed, "[a]lthough a defendant is entitled to the weight of the policy underlying the dismissal statute, which seeks to prevent unreasonable delays in litigation, the policy is less powerful than that which seeks to dispose of litigation on the merits rather than on procedural grounds." (Denham v. Superior Court (1970) 2 Cal.3d 557, 566, 86 Cal.Rptr. 65, 468 P.2d 193; Daley v. County of Butte (1964) 227 Cal.App.2d 380, 389-390, 38 Cal.Rptr. 693.) In sum, although the discretionary power to dismiss with prejudice has been upheld in this state, its use has been tightly circumscribed.

Similarly, federal appellate courts have also construed this power narrowly. Rule 41(b) of the Federal Rules of Civil Procedure permits a trial court to dismiss an action involuntarily. The rule authorizes dismissal upon a defendant's motion when the plaintiff has failed to comply with the Federal Rules of Civil Procedure or any order of the court. ⁵ In addition, the court, pursuant to its inherent power, may dismiss an action sua sponte for the same reasons. (Jones v. Caddo Parish School Bd. (5th Cir.1983) 704 F.2d 206, 215, fn. 17, rehg. en banc granted on other grounds (1984) 735 F.2d 923.)

If read literally, rule 41(b) would authorize dismissals with prejudice for the most trivial noncompliance with procedural rules or court orders. (9 Wright & Miller, Federal Practice & Procedure (1st ed. 1982) § 2369, p. 191.) However, an examination of federal decisional authority demonstrates that the utilization of rule 41(b) has been carefully circumscribed.

An order dismissing an action on one of the grounds delineated in rule 41(b) constitutes an adjudication on the merits unless the trial court specifies otherwise. (Fed.Rules Civ.Proc., rule 41(b), 28 U.S.C.) Thus, further adjudication of the same cause of action is barred even though the substantive issues of the case have never been addressed. (Saylor v. Lindsley (2d Cir.1968) 391 F.2d 965, 968.)

The effect of a dismissal under rule 41(b) is to forever deny a litigant access to the courts for the impartial resolution of potentially meritorious claims. (See Moore v. St. Louis Supply Co. (8th Cir.1976) 539 F.2d 1191, 1193.) For this reason, the federal courts, when called upon to determine the propriety of an involuntary dismissal, have repeatedly stressed that such a dismissal is a "drastic" measure which should be "used only in extreme situations" where "lesser sanctions would not serve the interests of justice." (Pond v. Braniff Airways, Inc. (5th Cir.1972) 453 F.2d 347, 349; see also Industrial Bldg. Materials, Inc. v. Interchemical Corp. (9th Cir.1970) 437 F.2d 1336, 1339.) ⁶

While rule 41(b) authorizes dismissals for a plaintiff's failure to comply with "any order of court," the scope of rule 41(b) is not as broad as its language would indicate. As demonstrated by the federal cases construing rule 41(b), there are two important inquiries to be made by trial courts when determining whether a plaintiff's actions warrant a dismissal with prejudice. First, the court must discern whether the plaintiff's pattern of conduct was so "severe [and] deliberate" as to constitute extreme circumstances. (Wrenn v. American Cast Iron Pipe Co. (5th Cir.1978) 575 F.2d 544, 547.) Second, the court must look to see whether alternatives less severe than dismissal are available. The "sound exercise of discretion requires the judge to consider and use lesser sanctions" unless the court's authority cannot possibly be otherwise vindicated. (Schenck v. Bear, Stearns & Co., Inc., supra, 538 F.2d at p. 60.)

The constraints placed on the discretion of the trial court in this area clearly attest to the fact that rule 41(b) motions for involuntary dismissal are not looked upon favorably by the federal appellate courts.

Likewise, this court must examine the circumstances under which appellant...