Woodman v. Selvage

• Decision Date: 24 June 1968
• Citation: 69 Cal.Rptr. 687,263 Cal.App.2d 390
• Court: California Court of Appeals Court of Appeals
• Parties: Roy H. WOODMAN et al., Plaintiffs and Appellants, v. Eugene S. SELVAGE and General Brewing Corporation, Defendants and Respondents. Civ. 24712.

Page 687

69 Cal.Rptr. 687

263 Cal.App.2d 390

Roy H. WOODMAN et al., Plaintiffs and Appellants, v. Eugene S. SELVAGE and General Brewing Corporation, Defendants and Respondents.

Civ. 24712.

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

June 24, 1968.

Rehearing Denied July 24, 1968.

Hearing Denied Aug. 21, 1968.

Philip A. Ray, Kelso, Cotton, Seligman & Ray, San Francisco, for appellants.

Marion B. Plant, Brobeck, Phleger & Harrison, Harold C. Faulkner, Faulkner, Sheehan & Wiseman, San Francisco, for respondent (Eugene S. Selvage).

Pillsbury, Madison & Sutro, Noble K. Gregory, William I. Edlund, Parker A. Maddux, San Francisco, for respondent (General Brewing Corporation).

SHOEMAKER, Presiding Justice.

This is an appeal by plaintiffs in a shareholders' derivative action from judgments of dismissal entered in favor of defendants Eugene Selvage and General Brewing Corporation upon plaintiffs' failure to comply with orders requiring them to post security, under section 834 of the Corporations Code, in the total amount of $160,000. ¹

Although plaintiffs' primary contention on appeal is that the court erred in ordering them to post security, they also contend that the court was required to disqualify itself, under Code of Civil Procedure, section 170.6, prior to ruling upon defendants' motions for security and that its failure to do so rendered its subsequent orders and judgments void. We agree with this latter contention.

On September 27, 1965, defendant General Brewing Corporation (hereafter referred to as 'General') moved for an order staying discovery proceedings until December 1, 1965 and extending until said date the time within which General might plead to the complaint or move for an order requiring the furnishing of security under section 834 of the Corporations Code. On October 1, 1965, the motion was heard before Judge Karesh, and counsel for General advised the court that due to the complicated nature of the case, he needed more time to familiarize himself with the facts and determine his course of action. At the conclusion of the hearing, judge Karesh granted the motion.

On December 1, 1965, all three defendants, General, Selvage and Ackerman, served notices of motion for orders requiring plaintiffs to furnish security under section 834 of the Corporations Code. All three notices stated that the motions would be brought on for hearing before the law and motion judge of the superior court on December 13, 1965, or as soon thereafter as counsel might be heard. The Ackerman notice of motion also specifically named Judge Karesh as the judge who would hear the motion.

On December 13, 1965, counsel for the respective parties appeared before Judge Karesh, and counsel for defendant General, speaking on behalf of all counel, immediately advised the court that the attorneys for all the parties, shortly after service of the notices of motion, had met and discussed the matter and had agreed that nothing would be done on December 13 but to attempt to set a hearing date which would be convenient for the court and all the parties. General's counsel further stated that a hearing date of January 5 was agreeable to al the parties and that the hearing would be extensive.

After counsel for the respective parties had dicussed the need for the taking of testimony in addition to the filing of affidavits, the court indicated that it would be unwilling to allow more than two afternoons for the hearing. Plaintiffs' counsel then suggested that in view of the court's crowded calendar, the matter should be referred to a trial department, as was frequently done. The court rejected this suggestion and reaffirmed its intention to set aside two afternoons for the hearing. Following further discussion relative to the need for subpoenaing various witnesses, the court set the hearing for three afternoons, January 10, 11 and 12, 1966.

Plaintiffs' counsel was the sworn and moved to disqualify Judge Karesh on the ground that he was prejudiced against plaintiffs and that they could not obtain a fair and impartial hearing before him. The court denied the motion on the ground that the oral statement of prejudice was untimely.

On January 10, 1966, the motions for security came on for hearing, and Judge Karesh then stated that subsequent to the December 13 hearing, he had received two communications from plaintiffs' counsel expressing the view that he had been disqualified. The judge reaffirmed his view that plaintiffs' motion to disqualify him under Code of Civil Procedure, section 170.6, was not timely. Thereafter he proceeded with the hearing which ultimately resulted in the orders requiring plaintiffs to post security and, upon their failure to do so, in the judgments of dismissal, the subject of this appeal.

At the time of plaintiffs' unsuccessful attempt to disqualify Judge Karesh, Code of Civil Procedure, section 170.6, provided in pertinent part that: '(1) No judge of any superior * * * court of the State of California shall try any civil or criminal action or special proceeding of any kind or character nor hear any matter therein which involves a contested issue of law or fact when it shall be established as hereinafter provided that such judge is prejudiced against any party or attorney or the interest of any party or attorney appearing in such action or proceeding.

'(2) Any party to or any attorney appearing in any such action or proceeding may establish such prejudice by an oral or written motion without notice supported by affidavit or an oral statement under oath that the judge before whom such action or proceeding is pending or to whom it is assigned is prejudiced against any such party or attorney or the interest of such party or attorney so that such party or attorney cannot or believes that he cannot have a fair and impartial trial or hearing before such judge. Where the judge assigned to or who is scheduled to try the cause or hear the matter is known at least 10 days before the date set for trial or hearing, the motion shall be made at least five days before that date. * * * If the motion is directed to a hearing (other than the trial of a cause), the motion must be made not later than the commencement of the hearing. * * * The fact that a judge has presided at or acted in connection with a pretrial conference or other hearing, proceeding or motion prior to trial and not involving a determination of contested fact issues relating to the merits shall not preclude the later making of the motion provided for herein at the time and in the manner hereinbefore provided.

'(3) If such motion is duly presented and such affidavit is duly filed or such oral statement under oath is duly made, thereupon and without any further act or proof, the judge supervising the master calendar, if any, shall assign some other judge to try the cause or...