PETERSON v. PAN AMERICAN WORLD AIRWAYS INC (1986)

This is an appeal in a class action suit from a superior court judgment dismissing the unnamed class members.

Plaintiffs Philip Peterson and Georgia Peterson (appellants) filed the instant class action against Pan American World Airways, Inc. (Pan Am or respondent) pursuant to the Consumers Legal Remedies Act, Civil Code sections 1750–1784. (Stats.1970, c. 1550, pp. 3157–59, § 1.) This act permits consumers to prosecute class actions on behalf of themselves and others similarly situated who have been injured by any of the various practices identified in Civil Code section 1770 as unfair and/or deceptive and declared to be unlawful.

Appellants alleges in this complaint that they read an advertisement in the Los Angeles Times newspaper publicizing a Two–for–One Pass offer for flight to anyone of several international destinations. The pertinent portion of the advertisement read as follows:

“A Two–for–One Pass entitles you to buy two roundtrip tickets for the price of one—from any place we fly in the U.S. to any of twelve places around the world.

“Now you can become a world traveler without spending a world of money!

“And getting a Two–for–One Pass is easy. We're giving them away to every passenger aboard every Pan Am and National flight within the U.S., September 1st through 30th, 1980․”

Appellants relying upon this advertisement purchased two roundtrip tickets from Los Angeles to San Francisco in order to earn Two–for–One Passes. When they arrived at the Los Angeles Pan Am terminal on September 11, 1980, they were told by Pan Am personnel that their flight had been cancelled. Because the next Pan Am flight did not depart for San Francisco until early in the morning the following day, they were told by Pan Am personnel that their tickets would be honored by PSA where they could depart within the hour for San Francisco. However, when Mr. Peterson requested the Two–for–One Passes, he was told that they would not be given to those who did not fly Pan Am¹ or National Airlines. (National Airlines was also involved in the offer but did not have a flight until the following morning.)

Appellants allege in their first amended complaint that in justifiable reliance upon Pan Am's advertisement they understood that if they had purchased tickets for domestic destinations on a Pan Am flight and presented themselves at Pan Am's air terminal facilities ready, willing and able to board the flight that the Two–for–One Passes would be forthcoming. That as a proximate result of the alleged representations of Pan Am, they suffered general damages including damages for emotional distress.

At the class certification hearing, appellants introduced evidence of at least 43 flight cancellations by Pan Am and National during the month of September 1980 and evidence that the program was extended by at least 12 days during the month of October. Based on data concerning flight cancellations and average passenger loads during the period, appellants estimated the size of the class of persons similarly situated to be between 10,000 and 15,000 persons.

The trial court dismissed appellants' action to the unnamed members of appellants' class, but permitted the lawsuit to proceed on their own behalf. The court stated its primary reason as follows:

“Plaintiffs have failed to meet their burden of proving by predominance of evidence that there is an ascertainable class of persons who have claims which can be proved on a common basis, i.e., that the issues common to the members of the class predominate over individual issues in the case, and that accordingly that there would be advantages to proceeding as a class action.”

DISCUSSION

The Consumers Legal Remedies Act (the 1970 Act) became effective on January 1, 1971. Prior to that time consumer class action litigation generally was commenced pursuant to common law procedures and Code of Civil Procedure section 382. The legislature made it clear, however, in enacting the 1970 Act that it was not exclusive so class action suits continue to be filed under either procedure. In Vasquez v. Superior Court, 4 Cal.3d 800, 94 Cal.Rptr. 796, 484 P.2d 964, the court in reviewing a consumer class action suit commenced before the 1970 Act, but decided after its passage, stated that the first requisite for maintenance of a class action suit was ascertainability of the class.² (Id. at p. 809, 94 Cal.Rptr. 796, 484 P.2d 964.) It is now appellants' principal argument on appeal that this criterion is not necessarily required when an action is brought pursuant to the 1970 Act. They claim the only requisites for certification of the class are found in section 1781, subdivision (b) of the act and ascertainment of the class is not a stated requirement.³

It is true that section 1781, subdivision (b) does not contain in specific language this basic rule but almost all appellate decisions since the passage of the 1970 Act have continued to recognize and enforce it. Many of these cases cite Civil Code section 1781, subdivision (b), although they have been filed pursuant to Code of Civil Procedure section 382. (See Altman v. Manhattan Savings Bank, 83 Cal.App.3d 761, 148 Cal.Rptr. 100, Hamwi v. Citinational–Buckeye Inv. Co., 72 Cal.App.3d 462, 140 Cal.Rptr. 215, and McGhee v. Bank of America, 60 Cal.App.3d 442, 131 Cal.Rptr. 482.) As far as we can determine, no case has decided or considered the specific issue raised by appellants.

The court clearly stated, supra, that it was denying certification because appellants had not proved by a preponderance of the evidence that there was an ascertainable class of persons who have claims which can be proved on a common basis. In the same statement of decision, it gave its reasons.⁴ In substance the court is stating that although 10,000 to 15,000 persons might have had their flights cancelled during the period in question, the evidence did not come close to establishing how many members within that group fit within the unique category of the appellants' class.⁵ In other words, there were too many variables as to the circumstances surrounding each individual in the class and what each person might do under the same set of circumstances that faced appellants. The court describes these variables (see fn. 4, supra ) and why the evidence presented by appellants did not sufficiently identify, among the 10,000 to 15,000 persons whose flights were cancelled, a class similar to appellants.⁶

The court's reasoning would certainly support noncertification of the class of the traditional class action suit brought pursuant to Code of Civil Procedure section 382, thus we must decide, as appellants contend,⁷ whether the 1970 Act eliminated the rule in question. Although as we stated earlier, Civil Code section 1781 does not specifically contain the language of the rule in issue we believe that the substance of the section maintains it. Subparagraph 2 states that there must be questions of law or fact common to the class that are substantially similar and predominate over the questions affecting the individual members. This requirement could not be determined by a court until the class is first ascertained from evidence presented at a certification hearing. As the court noted, the generalized statistical data presented by appellants did not prove by a preponderance of the evidence that there was an ascertainable class of persons who had claims which could be proved on a common basis. The issues common to the members of the class did not predominate over individual issues in the case. Weaver v. Pasadena Tournament of Roses, 32 Cal.2d 833, 198 P.2d 514 is a case in point. In this class action suit plaintiff alleged that defendant had made material misrepresentations by advertisements over the radio and in newspapers announcing a public sale of approximately 7,500 tickets for a Rose Bowl football contest. Plaintiffs claimed that they and other persons had presented themselves at the box office, were given numbered identification stubs, which were received by 3,350 persons, and that each stub holder had the opportunity to purchase two tickets. After only 1,500 tickets were sold, the box office was closed and it was announced that all available tickets had been sold. Our Supreme Court held that a class action suit was inappropriate because unique questions of law and fact predominated over common questions. The court stated, at pages 838–839: “True, the plaintiffs, and perhaps others who waited in line and were refused tickets of admission, have an interest in a common question of law ․ But the determination of such question in the present case would still leave to be litigated the right of any other person to recover on his statutory claim in the light of whether he, in reliance upon the advertised sale, stood in line, received an identification stub, was denied tickets before the promised 7,500 had been sold, presented himself at the Rose Bowl as a ‘sober, moral person,’ demanded admission, tendered the price, and was refused, entitling him ‘to recover ․ his actual damages' as well as the fixed statutory penalty of $100.”

The nature of the damages, including emotional distress, are also unique in this case and would not satisfy subparagraph two of section 1781, subdivision (b). (Altman v. Manhattan Savings Bank, supra, 83 Cal.App.3d 761, 769, 148 Cal.Rptr. 100)

We conclude that a plaintiff in a class action suit filed pursuant to the Consumers Legal Remedies Act still has the burden of proof to establish there is an ascertainable class. Having determined this issue, we must decide if the facts support the trial court's ruling. It is well established that class certification is within the sound discretion of the trial court. (Kagan v. Gibralter Sav. & Loan Assn., 35 Cal.3d 582, 595, 200 Cal.Rptr. 38, 676 P.2d 1060.) We must affirm if no abuse of discretion is shown. The court following established case law previously cited in this opinion meticulously analyzed the evidence and specified its reasons for denying certification. We can find no abuse of discretion.

The judgment dismissing the unnamed class members is affirmed.

FOOTNOTES

1.  The company policy in such a situation reads as follows:“․ Two for One Encore Program“Subj//// Eligibility for Two for One Boarding Pass when flight is canceled ․“/One/If flt is canceled after psgrs have been checked-in, psgrs may retain their boarding passes even if they are subsequently reaccommodated on OAL“/Two/If psgrs are notified of cancellation prior to check-in, they will not be eligible to rcve the Two for One Pass. /Note/ passengers shd be offered and must fly on a later PA/NA flt in order to receive a Two for One Boarding Pass. If psgr accepts reaccommodation on OAL but requests a Two for One Pass, he/she shd be tactfully advsd that this cannot be done. If psgr insists politely advise that this is beyond your jurisdiction and suggest that they write, giving details, to PA consumer action NYC for further consideration”

2.  The rule is generally stated as follows: Before a class action may be maintained, there must be an ascertainable class with a well defined community of interest in the questions of law and fact involved affecting the parties to be represented. (Daar v. Yellow Cab Co. 67 Cal.2d 695, 704, 63 Cal.Rptr. 724, 433 P.2d 732; Vasquez v. Superior Court, supra, 4 Cal.3d 800, 809, 94 Cal.Rptr. 796, 484 P.2d 964.)

3.  Section 1781, subdivision (b) states: “The court shall permit the suit to be maintained on behalf of all members of the represented class if all of the following conditions exist:“(1) It is impracticable to bring all members of the class before the court.“(2) The questions of law or fact common to the class are substantially similar and predominate over the questions affecting the individual members.“(3) The claims or defenses of the representative plaintiffs are typical of the claims or defenses of the class.“(4) The representative plaintiffs will fairly and adequately protect the interests of the class.”

4.  The reasons verbatim are as follows:“Plaintiffs' evidence is largely to the effect that a certain number of flights were cancelled by the defendant during the applicable period, and certain statistical information from which, they say, it can be determined that the flights carry a certain number of passengers on the average. However, as defendant points out, one cannot ascertain from this information how many members would be in the class and whether there is any feasible means that notice could be given to them in order that they might exercise their right not to be a member of the class, if that is their desire. One has an instinctife [sic] feeling that there probably a group of persons with common interests arising out of this situation, but the evidence presented by plaintiffs does not establish how many such persons there may be, where they are, or how their whereabouts could be ascertained. The evidence that certain flights were cancelled during the period is inadequate, even if we can assume a given number of persons who would have flown on the cancelled flight. As defendant points out, the fact that certain persons might have planned to fly on a cancelled flight does not mean that they were class members. For example, passengers may not be members of the class because they did not read or were not aware of defendant's advertisement because they were not induced to purchase the ticket by virtue of defendant's advertisement, because the passenger did not present himself at the boarding gate, ready, willing and able to board defendant's flight, because the purported class member was not denied a Two–for–One Pass as a result of the cancellation, because the purported class member traveled on a leter [sic] Pan American or a National flight and received a Two–for–One Pass, or because the passenger did not incur any injury by reason of not receiving the Two–for–One Pass.“Because of the failure of proof establishing the requisites of a class action, the court is unable to ascertain a size of any purported class, whether the issues common to the members of any such class predominate over individual issues and whether a class action is a preferable means of resolving the controversy as compared to other available means. Plaintiffs have failed to meet their burden of proof.”

5.  Appellants' first amended complaint describes the class as follows: All persons in California who were (1) induced by the Pan Am advertisement, read by the named plaintiffs, to purchase tickets during September and October 1980; (2) who presented themselves at defendants' terminal facilities ready, willing and able to board defendants' aircraft; (3) who were denied a “two-for-one” pass due to a cancellation of the flight or an oversale of the flight; and (4) who suffered damages as a result.

6.  Appellants did present the names of 19 individuals who claimed similar treatment. However, as Pan Am notes if they are the sole ascertainable members of the class they could not meet the requirement of Civil Code section 1781, subdivision (b)(1) that “[i]t is impracticable to bring all members of the class before the court.”

7.  Appellants rely on Hogya v. Superior Court 75 Cal.App.3d 122, 140, 142 Cal.Rptr. 325, which held that section 1781, subdivision (b), establishes the exclusive criteria for suits brought pursuant to the 1970 Act. We do not consider our conclusion to be adverse to this decision. We are addressing a different issue and resolving it based upon the wording of the section.

HASTINGS, Associate Justice.

FEINERMAN, P.J., and EAGLESON, J., concur.