Marine Forests v. California Coastal Com'n

• Decision Date: 04 March 2008
• Docket Number: No. C052872.,C052872.
• Parties: MARINE FORESTS SOCIETY et al., Plaintiffs and Appellants, v. CALIFORNIA COASTAL COMISSION, Defendant and Appellant.
• Court: California Court of Appeals Court of Appeals

74 Cal.Rptr.3d 32

160 Cal.App.4th 867

MARINE FORESTS SOCIETY et al., Plaintiffs and Appellants, v. CALIFORNIA COASTAL COMISSION, Defendant and Appellant.

No. C052872.

Court of Appeal, Third District.

March 4, 2008.

Bill Lockyer and Edmund G. Brown, Jr., Attorneys General, Tom Greene, Chief Assistant

Attorney General, J. Matthew Rodriquez, Senior Assistant Attorney General, and Lisa Trankley, Deputy Attorney General, for Defendant and Appellant.

The Zumbrun Law Firm, Ronald A. Zumbrun and Mark A. Teh, Sacramento, for Plaintiffs and Appellants.

SCOTLAND, P.J.

At issue in this appeal is whether Marine Forests Society (Marine Forests) qualifies for an award of attorney fees pursuant to Code of Civil Procedure section 1021.5 (hereafter section 1021.5), which entitles a "successful" litigant to such an award when its lawsuit "resulted in the enforcement of an important right affecting the public" and, among other things, "a significant benefit, whether pecuniary or nonpecuniary, has been conferred on the general public or a large class of persons." Even without a favorable judicial resolution, the plaintiff is considered a "successful" litigant for purposes of section 1021.5 if the lawsuit was the "catalyst" that caused "the defendant [to] change[ ] its behavior substantially because of, and in the manner sought by, the litigation." (Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553, 560, 21 Cal. Rptr.3d 331, 101 P.3d 140 (hereafter Graham).)

But for this lawsuit filed by Marine Forests, the California Coastal Commission (Commission) would be operating as it had since its creation. The authority of the Senate Committee on Rules and the Speaker of the Assembly to not only appoint a majority of the Commission's voting members but also to replace them at will if they act in a manner disfavored by the appointing authority allowed the Legislature to both declare the law and control the Commission's execution of the law and exercise of its quasi-judicial functions. That contravened the separation of powers clause of California's Constitution.

Because of this lawsuit, the Legislature amended the governing statutes to cure the constitutional defect by providing that each of the Commission members appointed by the Senate Committee on Rules or the Speaker of the Assembly shall serve a four-year term and cannot be removed at the pleasure of the appointing authority. This action conferred a benefit on the general public by eliminating the potential that a decision of the Commission affecting an important public right might be influenced by an appointment and removal process that was subject to making members of the Commission subservient to members of the Legislature.

However, while it was the impetus for change in the authority to appoint and remove members of the Commission, the lawsuit did not achieve its objective to enjoin the Commission from requiring Marine Forests to remove an experimental man-made reef that it had planted on the ocean floor. Indeed, the Commission resisted Marine Forests' attack on its action, and the judgment enjoining the Commission from ordering Marine Forests to cease and desist from maintaining the reef was reversed by the California Supreme Court, which held that "under the `de facto officer' doctrine[,] prior actions of the Commission [such as the cease and desist order in this case] cannot be set aside on the ground that the appointment of the commissioners who participated in the decision may be vulnerable to constitutional challenge." (Marine Forests Society v. California Coastal Com. (2005) 36 Cal.4th 1, 54, 30 Cal.Rptr.3d 30, 113 P.3d 1062.)

Consequently, even though it was the catalyst that caused the Legislature to change the appointment authority, the lawsuit did not cause "the defendant [the Commission]" to substantially change its behavior "because of, and in the manner sought by, the litigation." (Graham, supra, 34 Cal.4th at p. 560, 21 Cal.Rptr.3d 331, 101 P.3d 140.) Thus, despite the fact that this lawsuit was the catalyst for a change in the law, the catalyst theory for a section 1021.5 attorney award does not apply because it was the Legislature, not the Commission, that changed its behavior as a result of this lawsuit.

To the extent it can be said that the rationale of the catalyst theory should apply to a lawsuit like this, which was the moving force resulting in a change in statutory law that conferred a significant benefit on the general public regarding important rights affecting the public, the argument must be made to the California Supreme Court because we are bound by the ruling in Graham, supra, 34 Cal.4th at p. 560, 21 Cal.Rptr.3d 331, 101 P.3d 140. (Auto Equity Sales, Inc. v. Superior Court (1962) 57 Cal.2d 450, 455, 20 Cal. Rptr. 321, 369 P.2d 937.)

BACKGROUND

This is the third appeal stemming from litigation between Marine Forests and the Commission.

Because of the separation of powers problem summarized above, we initially affirmed the trial court's judgment that enjoined the Commission from granting, denying, or conditioning permits, or from issuing cease and desist orders. (Marine Forests Society v. California Coastal Com. (2002) 104 Cal.App.4th 1232, 128 Cal. Rptr .2d 869 (hereafter Marine Forests I), review granted Apr. 9, 2003, SI 13466.)

We then reversed the trial court's award of trial attorney fees to Marine Forests based on a private attorney general theory. We did so because Marine Forests failed to demonstrate that the financial burden of bringing the litigation was out of proportion to its individual stake in the matter—which is one of the three criteria necessary for the entitlement to attorney fees pursuant to section 1021.5. (Marine Forests Society v. California Coastal Commission (Apr. 1, 2003, C040739), 2003 WL 1711292 [nonpub. opn.] (hereafter Marine Forests II).)

In this third appeal, the Commission challenges the trial court's order awarding Marine Forests its appellate attorney fees. Marine Forests cross appeals, contending the trial court erred in ruling that law of the case precluded an award of trial fees and abused its discretion when it failed to apply a larger multiplier in awarding appellate attorney fees. As we will explain, Marine Forests is not entitled to attorney fees because it is not the prevailing party in that the California Supreme Court reversed the judgment in favor of Marine Forests (Marine Forests Society v. California Coastal Com., supra, 36 Cal.4th 1, 30 Cal.Rptr.3d 30, 113 P.3d 1062) and it is not a "successful" party under the "catalyst theory" for attorney fees pursuant to section 1021.5. Thus, we shall reverse the order awarding appellate attorney fees. Because Marine Forests was not entitled to attorney fees, its cross appeal fails.

FACTS

The Commission is the "state coastal zone planning and management agency" with primary responsibility for implementing the provisions of the California Coastal Act of 1976. (Pub. Resources Code, §§ 30300, 30330.) It has 12 voting members, with the Governor, the Speaker of the Assembly and the Senate Committee on Rules each selecting 4 members. (Pub. Resources Code, §§ 30301, subds. (d), (e), 30301.5.)

Marine Forests is a nonprofit corporation whose purpose is the development of experimental research programs for the creation of marine forests to replace lost marine habitat. To promote this objective, it planted an experimental marine forest on ,a sandy plain near Newport Harbor in Orange County, California. The marine forest was made of various materials, including used tires, plastic jugs, and concrete blocks.

When the Commission commenced cease and desist proceedings regarding the experimental reef, Marine Forests filed a lawsuit. Among other things, Marine Forests claimed that because members of the Commission served two-year terms at the pleasure of their appointing authority (former Pub. Resources Code, § 30312), the Commission should be enjoined from issuing cease and desist orders or from granting or denying permits for coastal development because the scheme for appointment of its voting members gave the legislative branch control over the Commission, thereby impermissibly interfering with the Commission's executive branch responsibility to execute the laws. The trial court ruled in favor of Marine Forests but stayed its decision pending the Commission's appeal.

In Marine Forests I, we concluded that the Commission's interpretation and implementation of the California Coastal Act is an executive function and that the appointment structure giving the Senate Committee on Rules and the Speaker of the Assembly the power to appoint the majority of the Commission's voting members and to remove them at will contravened the separation of powers clause of California's Constitution. This was so because that power allowed the legislative branch to not only declare the law, but also to control the Commission's execution of the law and exercise of its quasi-judicial powers. Accordingly, we affirmed the trial court's judgment in favor of Marine Forests. (Marine Forests I, supra, 104 Cal.App.4th 1232, 128 Cal.Rptr.2d 869, review granted Apr. 9, 2003.)

The Commission then appealed from the trial court's order awarding section 1021.5 attorney fees to Marine Forests. The Commission argued that Marine Forests failed to establish a necessary criterion for such an award, namely that the financial burden of litigation was outweighed by its personal stake in the matter. According to the Commission, Marine Forests had a strong personal and pecuniary motive to pursue the requested relief because its primary objective was to prevent the Commission from ordering it to remove its artificial reef, which would have been very costly, or to pay penalties of up to $6,000 a day if it failed to remove the artificial reef. (Pub. Resources Code, § 30821.6, subd. (a).) This purpose was shown by the fact that, aside from its separation of powers contention, Marine Forests alleged...