S.B. Beach Properties v. Berti

• Decision Date: 31 July 2006
• Docket Number: No. S127513.,S127513.
• Citation: 46 Cal.Rptr.3d 380,39 Cal.4th 374,138 P.3d 713
• Court: California Supreme Court
• Parties: S.B. BEACH PROPERTIES et al., Plaintiffs and Respondents, v. Richard A. BERTI et al., Defendants and Appellants.

46 Cal.Rptr.3d 380

39 Cal.4th 374

138 P.3d 713

S.B. BEACH PROPERTIES et al., Plaintiffs and Respondents, v. Richard A. BERTI et al., Defendants and Appellants.

No. S127513.

Supreme Court of California.

July 31, 2006.

Davis Wright Tremaine, Kelli L. Sager, Sonja R. West, Gary L. Bostwick, Rochelle L. Wilcox, Los Angeles; Foley & Bezek, Peter J. Bezek and Robert A. Curtis, Santa Barbara, for Defendants and Appellants.

Davis Wright Tremaine, Thomas R. Burke, San Francisco, and Kavita Amar, for Sierra Club as Amicus Curiae on behalf of Defendants and Appellants.

Levy, Ram & Olson, Karl Olson, San Francisco; Karlene W. Goller, Los Angeles; Jonathan Donnellan; Thomas W. Newton, Sacramento; Harold W. Fuson, Jr., La Jolla; Stephen J. Burns, Sacramento; David McCraw; and David Greene, for California Newspaper Publishers Association, Los Angeles Times, Hearst Communications, Inc., The Copley Press, Inc., McClatchy Newspapers, Inc., New York Times Company, California First Amendment Coalition and First Amendment Project as Amici Curiae on behalf of Defendants and Appellants.

Cappello & Noel, A. Barry Cappello, Troy A. Thielemann, Wendy D. Welkom and Christoph T. Nettesheim, Santa Barbara, for Plaintiff and Respondent S.B. Beach Properties.

Grokenberger & Smith, David W. Grokenberger, Santa Barbara, and W. Bradley Thomas, for Plaintiffs and Respondents William J. Levy and Roy J. Millender, Jr.

Thelen Reid & Priest, Daven G. Lowhurst, Patrick M. Ryan and Chad DeVeaux, San Francisco, for Richard Lamm as Amicus Curiae on behalf of Plaintiffs and Respondents.

CORRIGAN, J.

A strategic lawsuit against public participation (SLAPP) is subject to a special motion to strike (anti-SLAPP motion), under Code of Civil Procedure section 425.16 (anti-SLAPP statute).¹ A defendant who is the "prevailing [party] on" such a motion is "entitled to recover his or her attorney's fees and costs." (§ 425.16, subd. (c).) Here, plaintiffs voluntarily dismissed their entire action without prejudice before defendants attempted to file an anti-SLAPP motion. As a result, we conclude that defendants may not recover their attorney fees and costs pursuant to section 425.16, subdivision (c).

I. FACTUAL AND PROCEDURAL BACKGROUND

Plaintiff, S.B. Beach Properties is a limited partnership, with plaintiffs William J. Levy and Roy J. Millender, Jr. serving as general partners. Defendants Richard A. Berti, Marguerite A. Berti, and Ilene Bruckner are limited partners.

On January 2, 2003, plaintiffs sued defendants, alleging breach of fiduciary duty, breach of contract, and breach of the implied covenant of good faith and fair dealing. Plaintiffs alleged that the partnership was seeking approval to develop partnership property in Santa Barbara, that defendants opposed these plans and unreasonably demanded audits of the partnership records.

On January 21, defendants answered, asserting as an affirmative defense, that the complaint was "a strategic lawsuit against public participation" and subject to section 425.16.

On February 11, defendants filed an ex parte motion to increase the page limitation on the anti-SLAPP motion they planned to file. On February 20, plaintiffs voluntarily dismissed their entire complaint without prejudice.

The next day, defendants sought to file an anti-SLAPP motion, including a notice of a request for attorney fees and costs. The clerk initially accepted the motion but refused to calendar a hearing because plaintiffs had already dismissed the action. Later that afternoon, defendants tried to file additional supporting documents, but the clerk refused to accept them for the same reason.

On March 11, defendants filed a motion to recover attorney fees and costs under sections 425.16, subdivision (c) and 1033.5, subdivision (a)(10). The motion was denied. The trial court ruled, "[o]nce the case was dismissed the [anti-SLAPP] statute does not give the Court the right to make the decisions necessary to award fees. If the Legislature wanted fees to be awarded, post dismissal, it would be a simple matter to give appropriate directions to trial courts as to the guidelines we should follow. Absent such directions we have neither the authority nor any wish to invent them." The court also analogized the fee request to a motion for sanctions under section 128.7. Citing Eichenbaum v. Alon (2003) 106 Cal.App.4th 967, 131 Cal. Rptr.2d 296, the court concluded that the availability of a fee award under the anti-SLAPP statute, like the availability of sanctions under section 128.7, "depends upon whether the . . . motion was filed before or after dismissal." The court concluded that awarding fees in this case "would inevitably open the door to judicial intervention, after dismissal, in virtually any case that might possibly be related to the interests sought to be protected."

The Court of Appeal reversed, relying on cases holding that "a dismissal of the complaint after the anti-SLAPP motion is filed, but prior to a hearing on the motion, does not deprive the court of jurisdiction" to award attorney fees and costs under section 425.16, subdivision (c). According to the appellate court, "[i]f a dismissal prior to the hearing on the motion does not deprive the court of jurisdiction, there is no reason why a dismissal prior to filing the motion should." It further observed that "[t]he filing and service of a complaint demanding substantial damages can inhibit participation in matters of public significance." Thus "[t]he purpose of the anti-SLAPP statute will not be achieved if an offending plaintiff can avoid sanctions simply by dismissing his complaint before the defendant files his motion."

II. DISCUSSION OF SECTION 425.16, SUBDIVISION (c)

Under section 425.16, subdivision (c), "any SLAPP defendant who brings a successful motion to strike is entitled to mandatory attorney fees." (Ketchum v. Moses (2001) 24 Cal.4th 1122, 1131, 104 Cal.Rptr.2d 377, 17 P.3d 735.) Here, however, plaintiffs voluntarily dismissed their action pursuant to section 581 before defendants filed an anti-SLAPP motion. Defendants maintain they may still recover their attorney fees and costs. We conclude to the contrary. Defendants who fail to file an anti-SLAPP motion before the voluntary dismissal of all causes of actions against them cannot recover fees or costs under section 425.16, subdivision (c).

Section 425.16, subdivision (b)(1) provides: "[a] cause of action against a person arising from any act of that person in furtherance of the person's right of petition or free speech under the United States or California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." Section 425.16, subdivision (c) then states that "[i]n any action subject to subdivision (b), a prevailing defendant on a special motion to strike shall be entitled to recover his or her attorney's fees and costs."

In construing any statute, we first look to its language. (Wilcox v. Birtwhistle (1999) 21 Cal.4th 973, 977, 90 Cal. Rptr.2d 260, 987 P.2d 727.) "Words used in a statute . . . should be given the meaning they bear in ordinary use. [Citations.] If the language is clear and unambiguous there is no need for construction, nor is it necessary to resort to indicia of the intent of the Legislature . . . ." (Lungren v. Deukmejian (1988) 45 Cal.3d 727, 735, 248 Cal.Rptr. 115, 755 P.2d 299.) "If the language permits more than one reasonable interpretation, however, the court looks `to a variety of extrinsic aids, including the ostensible objects to be achieved, the evils to be remedied, the legislative history, public policy, contemporaneous administrative construction, and the statutory scheme of which the statute is a part.' [Citation.]" (Wilcox v. Birtwhistle, at p. 977, 90 Cal. Rptr.2d 260, 987 P.2d 727.)

Under section 425.16, subdivision (c), only a "prevailing defendant on a special motion to strike" may recover attorney fees and costs. (Italics added.) This statutory language is unambiguous, and makes the filing of a viable anti-SLAPP motion a prerequisite to recovering any fees and costs. As a matter of logic, a defendant must file a special motion to strike in order to prevail on one. [138 P.3d 380]

Here, defendants failed to do so before plaintiffs' voluntary dismissal. A section 581 dismissal "is available to [a] plaintiff as a matter of right and is accomplished by filing with the clerk a written request therefor. If in proper form, the dismissal is effective immediately." (Associated Convalescent Enterprises v. Carl Marks & Co., Inc. (1973) 33 Cal.App.3d 116, 120, 108 Cal.Rptr. 782.) "The entry is a ministerial, not a judicial, act, and no appeal lies therefrom." (Ibid.) Once plaintiffs dismissed their action no lawsuit existed for defendants to move against pursuant to section 425.16, subdivision (c).

Defendants nonetheless maintain that the trial court retained authority to resolve their fees and costs motion. They correctly note that a voluntary dismissal under section 581 does not deprive the trial court of jurisdiction over "collateral statutory rights," including "the right to statutory costs and attorneys fees . . . ." (Frank Annino & Sons Construction, Inc. v. McArthur Restaurants, Inc. (1989) 215 Cal. App.3d 353, 357, 263 Cal.Rptr. 592.) This general rule does not assist defendants here. The general rule does not apply because defendants' particular request is based on a claimed entitlement arising from their success on a motion they did not file.

Legislative history buttresses this conclusion. In enacting the anti-SLAPP statute, the Legislature adopted a balanced approach to end SLAPP suits at an early stage while not jeopardizing meritorious actions. (Gallagher v. Connell (2004) 123 Cal.App.4th 1260, 1269, 20 Cal.Rptr.3d 673.) The Legislature originally passed an anti-SLAPP bill that ...