Tony Fu v. Kaman Liu
| Docket Number | A166795 |
| Decision Date | 02 November 2023 |
| Parties | TONY FU, Plaintiff and Appellant, v. KAMAN LIU, Defendant and Respondent. |
| Court | California Court of Appeals Court of Appeals |
NOT TO BE PUBLISHED
Plaintiff and appellant Tony Fu's complaint against defendant and respondent Kaman Liu was dismissed pursuant to Code of Civil Procedure section 583.310 et seq.[1] for failure to bring the action to trial within five years. On appeal, Fu urges us to overturn the five-year dismissal order, arguing the trial court erroneously failed to toll the five-year clock under section 583.340 based on removal of the case to federal bankruptcy court, two bankruptcy stays, a period in which Liu was in default status, and a discovery dispute. We conclude the trial court erred in not tolling the time the action was removed to federal bankruptcy court, but in all other respects, the trial court did not err. We affirm.
Fu, a self-represented litigant, commenced this action on August 15, 2016 with the filing of his original complaint. He filed the operative Second Amended Complaint (SAC) on October 19 2021. Fu asserted multiple causes of action including fraudulent transfer, conspiracy to defraud, and unfair business practices against several defendants, including Liu Demas Yan a/k/a/ Dennis Yan, and Thai Ming Chiu. Fu alleged that Yan was a vexatious litigant against whom he had secured over $220,000 in judgments and sanctions which had not been paid. He further alleged that Yan had fraudulently transferred assets to his brothers-in-law Liu and Chiu and others to conceal them from satisfying the outstanding judgments.
On April 26, 2017, Liu filed a cross-complaint, seeking to enforce a money judgment against Fu which Liu alleged had been assigned to him, and asserting additional claims against Fu and others for fraudulent conveyance, conspiracy, and aiding and abetting fraud.
On May 5, 2017, Fu filed for bankruptcy. He prepared a "Notice of Stay of Proceedings," checking the box on the Judicial Council form that the case was stayed "[w]ith regard to all parties" due to his bankruptcy filing; he filed the notice on May 8, 2017. The case was removed to federal bankruptcy court on May 19, 2017 and remanded back to the superior court on August 21, 2017.
One week after remand, Liu's counsel filed a "Notice of Termination or Modification of Stay." Liu represented the stay Fu had earlier noticed had been vacated by the order of another court. Disagreeing that the stay had been terminated, Fu filed a motion in the bankruptcy court requesting it set a termination date for the stay. In a written order captioned "Order Denying Debtor's Motion to Set Stay Termination Date," the bankruptcy court denied Fu's requested relief but clarified that it had only remanded the case without granting relief from the stay to any party or terminating it. From the trial court, Fu obtained an "Order to Enjoin and to Ban Kaman Liu's August 28, 2017 Notice of Termination of Stay," in which the court found Liu's notice was a fraud and enjoined it. In the months that followed, little litigation activity took place in the case.
On January 13, 2020 - approximately two years and nine months after filing for bankruptcy - Fu's bankruptcy proceeding was discharged. Following the discharge, Fu proceeded to prosecute the case. For instance, in August 2020, upon receiving leave to amend his pleading, he filed his First Amended Complaint. In September 2021, he again requested permission to amend and was granted leave to file his SAC which Fu filed in October 2021. In February 2022, Fu deposed Liu following a successful motion to compel his appearance. Additionally, in March 2022, Fu filed a request to enter default against Liu for his failure to respond to the SAC, though the court eventually set aside Liu's default in June 2022.
On July 13, 2022, in response to an order to show cause, Fu informed the court that
On July 21, 2022, Liu filed his first motion for mandatory dismissal of the case for Fu's failure to bring it to trial within five years as required by section 583.310. The motion was taken off calendar for procedural defects.
On August 2, 2022, Fu filed a motion requesting the court set a trial date. On August 10, 2022, Liu's co-defendant Chiu filed for bankruptcy. Fu represents that because of Chiu's bankruptcy, he took his request to set a trial date off calendar.
On September 12, 2022, Liu re-filed his motion for mandatory dismissal. Following further briefing and a hearing, the trial court granted the motion and dismissed the case on October 18, 2022. In explaining dismissal, the court stated Fu had failed to bring his case to trial within five years and that the Bankruptcy Code did not stay actions brought by the bankruptcy debtor.
Fu unsuccessfully moved for reconsideration. The court's one-page order stated that Fu had failed to sustain his burden on reconsideration under section 1008 and that "even if the arguments regarding tolling (arguments that could have been, but were not made previously) were considered, [Fu] failed to show that 5 years would not have run before October 7, 2022, the date of the original hearing."
This appeal followed.
" " (Denham v. Superior Court (1970) 2 Cal.3d 557, 564.) We affirm the judgment if any possible grounds exist for the trial court to have reached its factual conclusions. (Howard v. Owens Corning (1999) 72 Cal.App.4th 621, 630631.) And any ambiguity in the record is resolved in favor of the judgment. (Hirshfield v. Schwartz (2001) 91 Cal.App.4th 749, 765-766.)
Self-represented litigants must follow and are held to the same rules of procedure as litigants represented by counsel. (Burnete v. La Casa Dana Apartments (2007) 148 Cal.App.4th 1262, 1267.)
Section 583.310 states that "[a]n action shall be brought to trial within five years after the action is commenced against the defendant." (§ 583.310.) If that does not occur, dismissal is required under section 583.360: (§ 583.360; Gaines v. Fidelity National Title Ins. Co. (2016) 62 Cal.4th 1081, 1089-1090 (Gaines).)
The permissible time period under section 583.310 is extended under certain circumstances set forth in section 583.340: (§ 583.340.) The first two factors - suspension of jurisdiction and stay of the action - generally present legal issues that do not involve the exercise of discretion. (See Bruns v. E-Commerce Exchange, Inc. (2011) 51 Cal.4th 717, 726 (Bruns); Spanair S.A. v. McDonnell Douglas Corp. (2009) 172 Cal.App.4th 348, 358-359 (Spanair); see also Gaines, supra, 62 Cal.4th at p. 1092.)
The third factor - bringing the action to trial was "impossible, impracticable, or futile" - is subject to the trial court's broad discretion. (§ 583.340, subd. (c); Hughes v. Kimble (1992) 5 Cal.App.4th 59, 71 (Hughes); see also Gaines, supra, 62 Cal.4th at p. 1100 [].) Courts evaluate impossibility, impracticability, or futility based on all the circumstances of a particular case, with a particular focus on whether the plaintiff diligently prosecuted the action. (Tanguilig v. Neiman Marcus Group, Inc. (2018) 22 Cal.App.5th 313, 323.)"' "[I]mpracticability and futility" involve a determination of" 'excessive and unreasonable difficulty or expense,'" in light of all the circumstances of the particular case.'" (Id. at pp. 323-324.)
In evaluating tolling arguments, the court must consider the general policy favoring trial on the merits but where the action is pending longer than the mandatory five-year deadline and is not subject to tolling, the mandatory dismissal rule must be followed. (Gaines, supra, 62 Cal.4th at pp. 1090, 1105.) The requirement of diligent prosecution of litigation protects the public by "declogging court calendars" (Reid v. Balter (1993) 14 Cal.App.4th 1186, 1195-1196) and protects defendants from defending against stale and potentially unmeritorious claims for unreasonable periods of time (Sagi Plumbing v. Chartered Construction Corp. (2004) 123 Cal.App.4th 443, 447).
Our review of the trial court's determination of whether section 583.310 was tolled for impossibility impracticability, or futility is limited to a review for abuse of discretion. (Bruns, supra, 51 Cal.4th at p. 723; see also Sanchez v. City of Los Angeles (2003) 109 Cal.App.4th...
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