Joanne TKACZYK, Plaintiff and Appellant, v. CITY OF LOS ANGELES, et al., Defendants and Respondents.
This is an appeal by an attorney, William A. Kent of the law firm of Jay S. Rothman, from an order imposing monetary sanctions pursuant to Code of Civil Procedure section 177.5 1 for failure to obey a court order. We affirm.
In October 1985, plaintiff Joanne Tkaczyk instituted the underlying action against defendant City of Los Angeles for damages allegedly resulting from a motorcycle accident. The city demurred, and plaintiff filed a first amended complaint in January 1986. The trial court sustained the demurrer to that pleading in May 1986, but granted plaintiff 30 days to amend. Following the filing of a second amended complaint in June 1986, the court again sustained the city's demurrer with 30 days to amend. When plaintiff failed to file an amended pleading, the city moved to dismiss the action. In October 1986, the court granted the motion and awarded costs. Some seven months later, however, the dismissal was set aside and plaintiff filed a third amended complaint. The city again demurred, and the matter was set for hearing on July 15, 1987. During that hearing, it became apparent that plaintiff had filed two different third amended complaints with the court, and had served a third version on the city. As a result, the trial court struck all the pleadings and ordered plaintiff's counsel to file and personally serve on defense counsel a fourth amended complaint within seven days. Although the complaint was filed the following day, it was not served on the city clerk by plaintiff's process server until July 23, 1987, one day late.
The city thereafter moved to dismiss for failure to comply with the court's order. Plaintiff neither filed opposition thereto nor appeared at the hearing on the motion. Following dismissal of the action on September 10, 1987, plaintiff filed a “Notice of Motion and Motion to vacate and set aside or reconsider or new trial ․” in which she conceded that there had been a “technical violation” of the court's order because of her process server's negligence, but urged that “such violation should not warrant or justify the drastic result of dismissal.” 2 Although the court set aside the dismissal, it directed plaintiff's counsel to pay $1,500 in sanctions pursuant to section 177.5 for failure to serve the fourth amended complaint within the time limits of the prior order.3
On this appeal, counsel contends that order awarding sanctions must be reversed because: (1) he had inadequate notice and opportunity to be heard before the sanctions were imposed; (2) he demonstrated good cause or substantial justification for failing to serve the amended complaint within 7 days; and (3) the order was insufficient in detail as to the conduct or circumstances justifying the award. Before proceeding to a discussion of these issues, however, we must first determine whether the challenged order is properly before us for review.
Although an order imposing sanctions pursuant to section 177.5 is not specifically mentioned in section 904.1, it is appealable as a final order on a collateral matter directing the payment of money. (See I.J. Weinrot & Son, Inc. v. Jackson (1985) 40 Cal.3d 327, 331, 220 Cal.Rptr. 103, 708 P.2d 682; Bauguess v. Paine (1978) 22 Cal.3d 626, 634, 150 Cal.Rptr. 461, 586 P.2d 942, fn. 3; Kibrej v. Fisher (1983) 148 Cal.App.3d 1113, 1115, 196 Cal.Rptr. 454; Wisniewski v. Clary (1975) 46 Cal.App.3d 499, 502, 120 Cal.Rptr. 176.) As the Supreme Court explained in In re Marriage of Skelley (1976) 18 Cal.3d 365, 368, 134 Cal.Rptr. 197, 556 P.2d 297: “When a court renders an interlocutory order collateral to the main issue, dispositive of the rights of the parties in relation to the collateral matter, and directing payment of money or performance of an act, direct appeal may be taken. [Citations.] This constitutes a necessary exception to the one final judgment rule. Such a determination is substantially the same as a final judgment in an independent proceeding. [Citations.]” 4 While not a party to the underlying action, plaintiff's counsel is a party of record in the collateral matter by virtue of the trial court's order and has standing to appeal. (See Ellis v. Roshei Corp. (1983) 143 Cal.App.3d 642, 645, 192 Cal.Rptr. 57, fn. 3.)
Turning now to the substantive issues raised by appellant, we first note that section 177.5 is similar in purpose and design to the provisions of section 128.5.5 That statute was enacted in direct response to the Supreme Court's ruling in Bauguess v. Paine, supra, 22 Cal.3d 626, 150 Cal.Rptr. 461, 586 P.2d 942 that trial courts do not possess the inherent power to impose sanctions through awards of attorney's fees. The court's decision was based in large part on the possibility of “serious due process problems” (id. at p. 638, 150 Cal.Rptr. 461, 586 P.2d 942) if monetary sanctions were awarded without “appropriate safeguards.” (Id. at p. 639, 150 Cal.Rptr. 461, 586 P.2d 942.) To remedy this lack of statutory authority, the Legislature passed section 128.5 in 1981, intending that it “broaden the powers of trial courts to manage their calendars and provide for expeditious processing of civil actions by authorizing monetary sanctions now not presently authorized by the interpretation of the law․” (Stats.1981, ch. 762, § 2; Ellis v. Roshei Corp., supra, 143 Cal.App.3d at p. 648, 150 Cal.Rptr. 461, 586 P.2d 942.) Section 177.5 was enacted the following year apparently to complement section 128.5 by providing an alternative to the more cumbersome contempt proceedings specified in section 1209 et seq. for violation of a lawful court order without good cause or substantial justification.6
Recognizing the due process concerns expressed in Bauguess, the Legislature specifically provided that sanctions under section 177.5 “shall not be imposed except on notice contained in a party's moving or responding papers; or the court's own motion, after notice and opportunity to be heard.” (See generally In re Marriage of Flaherty (1982) 31 Cal.3d 637, 651–654, 183 Cal.Rptr. 508, 646 P.2d 179; Brekhus & Williams v. Parker–Rhodes (1988) 198 Cal.App.3d 788, 792, 244 Cal.Rptr. 48.) The statute, however, is silent as to the measure of notice required. Construing identical language in section 128.5, the court in Lesser v. Huntington Harbor Corp. (1985) 173 Cal.App.3d 922, 932, 219 Cal.Rptr. 562 observed that the adequacy of notice thereunder “should be determined on a case-by-case basis to satisfy basic due process requirements. The act or circumstances giving rise to the imposition of expenses must be considered together with the potential dollar amount.” 7 Considering the similarity between the two statutes, we are of the view that the flexible standard adopted in Lesser should apply when accessing the adequacy of notice and the opportunity to be heard under section 177.5.
In our case, counsel was not informed until the day of the hearing on his motion to set aside the dismissal that sanctions would be imposed for his failure to comply with the prior court order. Even a cursory review of that proceeding, however, makes it clear that he presented all the evidence at his disposal in an attempt to persuade the trial court that sanctions were not warranted. That he failed in his attempt does not establish a denial of due process. Although counsel had no prior notice of the court's intention to impose sanctions, the evidence he offered in relation to his motion to set aside the dismissal also provided some justification for his failure to serve the fourth amended complaint within seven days. The court specifically considered the declaration of the process server who admitted delaying service for one week after receiving the amended complaint from counsel. Under the circumstances, it is difficult to imagine what other evidence could have been offered to explain the failure to obey the prior court order. Indeed, at the time of the hearing counsel himself conceded the appropriateness of imposing sanctions and merely argued for a reduction in the amount of the award.
Based upon the foregoing, we cannot conclude that counsel was denied either adequate notice or an opportunity to be heard before the sanctions were imposed.
Whether or not a party, a party's counsel, or a witness violates a lawful court order without good cause or substantial justification is a question addressed to the sound discretion of the trial court in the first instance. Its decision will not be reversed on appeal absent a manifest abuse of discretion. (Cf. Luke v. Baldwin–United Corp. (1985) 167 Cal.App.3d 664, 668, 213 Cal.Rptr. 654; Atchison, Topeka & Santa Fe Ry. Co. v. Stockton Port Dist. (1983) 140 Cal.App.3d 111, 117, 189 Cal.Rptr. 208.) Based upon the record presently before us, we cannot find such an abuse here. Although the delay in service of the amended complaint was due in substantial part to the negligence of the process server, it was plaintiff's counsel who bore the ultimate responsibility for complying with the trial court's earlier order. The process server's negligence did not relieve counsel of his duty to have the amended pleading filed and served within the time frame established by the court. By so concluding, we do not mean to imply that an attorney must personally serve opposing counsel or risk the imposition of sanctions. Counsel may, of course, utilize staff members, attorney services, and process servers to perform such tasks. However, any failure to comply with a lawful court order without good cause or substantial justification will be chargeable to counsel. (Cf. In re Marriage of Gumabao (1984) 150 Cal.App.3d 572, 577, 198 Cal.Rptr. 90, fn. 5.) Under the circumstances presented here, we cannot say the trial court abused its discretion by holding plaintiff's counsel responsible for any delays that may have occurred in service of the amended complaint.
We next consider counsel's contention that the trial court's order fails to comply with that portion of section 177.5 requiring a detailed recital of the circumstances justifying the imposition of sanctions. Here, the minute order simply states “Sanctions granted against counsel for moving party in sum of $1500 per CCP 177.5 payable to Clerk of Court, within 60 days.”
Under section 177.5 an order imposing sanctions must be in writing and “recite in detail the conduct or circumstances justifying the order.” As with identical language found in section 128.5, the purpose of this provision “is to fulfill the ‘rudiments' of due process required for governmental imposition of a penalty upon an attorney or party—both for due process' own, constitutional sake and to ensure that the power conferred by the statute will not be abused. [Citations.] Moreover, in some cases the court's recitation will be an invaluable aid to a reviewing court determining whether the trial court abused its discretion in awarding sanctions. [Citation.]” (Lavine v. Hospital of the Good Samaritan (1985) 169 Cal.App.3d 1019, 1029, 215 Cal.Rptr. 708.)
Due process thus requires that any order issued pursuant to section 177.5 state the specific circumstances giving rise to the imposition of sanctions, and state with particularity the basis for finding a violation of a lawful court order without good cause or substantial justification. Needless to say, the court's written order should be more informative than a mere recitation of the words of the statute and should provide sufficient information to permit meaningful review. (Cf. Fegles v. Kraft (1985) 168 Cal.App.3d 812, 816, 214 Cal.Rptr. 380.)
In the case at bench, however, we have no trouble discerning the facts of this case or the court's rationale for issuing its order. In fact, counsel conceded in the trial court that sanctions were appropriate. The only issue raised was the amount of those sanctions.
Under the circumstances, and with full awareness of the ordinarily mandatory provisions of section 177.5 (cf. Miramar Hotel Corp. v. Frank B. Hall & Co. (1985) 163 Cal.App.3d 1126, 210 Cal.Rptr. 114), we feel that remanding the case for more detailed compliance with the statute would be an idle act which would be of no benefit to plaintiff's counsel.
The order appealed from is affirmed.
1. All further references are to the Code of Civil Procedure unless otherwise indicated.Section 177.5 provides:“A judicial officer shall have the power to impose reasonable money sanctions, not to exceed fifteen hundred dollars ($1,500), notwithstanding any other provision of law, payable to the county in which the judicial officer is located, for any violation of a lawful court order by a person, done without good cause or substantial justification. This power shall not apply to advocacy of counsel before the court. For the purposes of this section, the term ‘person’ includes a witness, a party, a party's attorney, or both.“Sanctions pursuant to this section shall not be imposed except on notice contained in a party's moving or responding papers; or on the court's own motion, after notice and opportunity to be heard. An order imposing sanctions shall be in writing and shall recite in detail the conduct or circumstances justifying the order.”
2. The motion to set aside was based in part on the declaration of plaintiff's process server which stated:“On July 16, 1987, I received a fourth amended complaint ․ with instructions to serve Ward G. McConnell, Deputy City Attorney at 200 North Main Street, 18th Floor, Office of the City Attorney, Los Angeles, CA.“I went to the above address to serve same and was greeted by the receptionist. I told her I had a fourth amended complaint to serve on the above mentioned defendant. She contacted Mr. McConnell by telephone, and he told her to tell me that these papers had to be served at the City Clerk's office at 220 N. Spring, Room 395, Los Angeles, CA.“On July 23, 1987, I went to the City Clerk's office. I spoke to Mellissa Lopez, City Clerk, and told her that I had a fourth amended complaint to serve on Ward G. McConnell, Deputy City Attorney. She told me that she would accept service, therefore, I served her with the papers at 12:20 p.m.”
3. The following colloquy occurred between the court and plaintiff's counsel at the time the sanctions were imposed:“The Court: I will grant the motion to set aside the default. I will vacate and set aside the default. I will give the City 30 days to respond. [¶] Counsel, however, you didn't comply with the prior court order. Now I am going to impose sanctions of $2,000 in this case, payable by you under [section 177.5 of the Code of Civil Procedure]. And that is to be payable to the Clerk of the Court. That is to be payable to this court. It is not to opposing counsel but to this court. [¶] I will hear from you on that. You didn't obey a prior court order. I think sanctions under [section 177.5] are certainly in order. You didn't come to the last hearing. You could have argued and told me about this. [¶] You tell me why it isn't justified in this case.“Mr. Kent [plaintiff's counsel]: Your, Honor, the amount is very high. And I could see if Your Honor wants to impose sanctions, I could understand that. But $2,000 to me is oppressive, Your Honor.“The Court: What do you think is not oppressive? ․ This is a busy court. We have asked you to obey the court order previously․ What is not oppressive?“Mr. Kent: $500, Your Honor, and that will be coming out of our pocket and that would be sanction enough.“The Court: $1500. That is payable to this court and to the County within ․ sixty days․”
4. We have recently detected an increasing number of appeals of the type involved here where the sanctions imposed are of relatively small amounts of money. It seems anomalous that where an attorney is threatened with incarceration under a contempt citation, his or her only remedy is by way of extraordinary writ. (See In re Buckley (1973) 10 Cal.3d 237, 240, 110 Cal.Rptr. 121, 514 P.2d 1201, fn. 1.) Yet where monetary sanctions are ordered, a full blown appeal is permitted. This imposes an unnecessary burden on the appellate courts.The solution to this recurring problem would seem to be for the Legislature to specify that orders such as these are nonappealable and require the sanctioned party to proceed by way of extraordinary writ. Under that procedure, the opposing party would not be compelled, in the first instance, to respond and the appellate court could summarily dispose of non-meritorious petitions without the need for a written opinion. In the interim, however, we are compelled under the authority of Bauguess v. Paine, supra, and In re Marriage of Skelley, supra, among other cases, to conclude that an order imposing sanctions pursuant to section 177.5 is appealable.
5. Section 128.5 provides in pertinent part as follows:“(a) Every trial court may order a party, the party's attorney, or both to pay any reasonable expenses, including attorney's fees, incurred by another party as a result of bad-faith actions or tactics that are frivolous or solely intended to cause unnecessary delay․“(b) For purposes of this section:“(1) ‘Actions or tactics' include, but are not limited to, the making or opposing of motions or the filing and service of a complaint or cross-complaint. The mere filing of a complaint without service thereof on an opposing party does not constitute ‘actions or tactics' for purposes of this section.“(2) ‘Frivolous' means (A) totally and completely without merit or (B) for the sole purpose of harassing an opposing party.“(c) Expenses pursuant to this section shall not be imposed except on notice contained in a party's moving or responding papers; or the court's own motion, after notice and opportunity to be heard. An order imposing expenses shall be in writing and shall recite in detail the conduct or circumstances justifying the order.“(d) The liability imposed by this section is in addition to any other liability imposed by law for acts or omissions within the purview of this section.”
6. Section 1209, subdivision (a)(5) makes “[d]isobedience of any lawful judgment, order, or process of the court” a contempt of the authority of the court. Upon finding a willful violation of such an order (see Reliable Enterprises, Inc. v. Superior Court (1984) 158 Cal.App.3d 604, 611–617, 204 Cal.Rptr. 786; In re Liu (1969) 273 Cal.App.2d 135, 140, 78 Cal.Rptr. 85), the trial court may impose a fine not exceeding $1,000 or imprisonment not exceeding 5 days, or both. (See § 1218.)
7. In Lesser, the court concluded that a sanction hearing held less than one day after notice to counsel was insufficient to satisfy the due process requirement. In M.E. Gray Co. v. Gray (1985) 163 Cal.App.3d 1025, 210 Cal.Rptr. 285, however, one-day notice contained in a party's responding papers was held to be adequate. The court in Ellis v. Roshei Corp., supra, 143 Cal.App.3d 642, 192 Cal.Rptr. 57, suggested, but did not hold, that “for purposes of requesting sanctions under section 128.5 the five-day response time of [Code of Civil Procedure] section 1005 would be jurisdictional to the due process requirements discussed in Bauguess. ” (Id. at p. 647, 192 Cal.Rptr. 57, fn. 5.) The court nonetheless emphasized that “[t]he trial court has the inherent power and the right to control its own proceedings to allow such additional time as, in its discretion, it deems necessary to insure a fair hearing on the request for sanctions.” (Ibid.)
COMPTON, Acting Presiding Justice.
GATES and FUKUTO, JJ., concur.