Opinion
H048751
09-20-2022
SUSAN BASSI, Plaintiff and Appellant, v. NAT E. HALES, JR., Defendant and Respondent.
NOT TO BE PUBLISHED
Santa Clara County Super. Ct. No. 18-CV-336848
GROVER, J.
Plaintiff appeals from a judgment of dismissal entered after the trial court sustained a demurrer to her first amended complaint on grounds of absolute quasi-judicial immunity. For the reasons stated here, we will affirm the judgment, but will deny defendant's motion for sanctions.
We take judicial notice of the Santa Clara County Superior Court's records in the underlying proceeding, as well as in plaintiff's dissolution proceeding (case No. 2012-6-FL-009065), plaintiff's 2015 lawsuit against an accountant involved in the dissolution matter (case No. 2015-1-CV-280064), and plaintiff's 2017 lawsuit against defendant Hales (case No. 17-CV-320164). (Evid. Code, §§ 452, subd. (d), 459.) We grant defendant's request for judicial notice of the Santa Clara County Superior Court's records in two proceedings initiated by plaintiff seeking permission to file a complaint against her former spouse and his attorney in the dissolution action (case Nos. 19-CV-367601 and 20-CV-368698). Defendant's request for judicial notice of the appeal in the dissolution matter is denied.
Robert Bassi filed a petition to dissolve his marriage to Susan Bassi (the plaintiff and appellant in the instant case) in the Santa Clara County Superior Court in 2012. Nat E. ("Ned") Hales, Jr. (the defendant and respondent in the instant case) is an attorney appointed by the trial court in 2014 as a referee in the dissolution matter. Defendant acted as a referee in that case for 16 months. Final judgment was entered in the dissolution matter in 2018, after a long cause trial. Plaintiff's appeal from that judgment is pending in this court.
In December 2017, plaintiff sued defendant for "damages according to proof" related to his service as a court appointed referee. The first amended complaint alleged causes of action for constructive trust and declaratory relief, asserting that defendant failed to provide a conflict of interest disclosure or otherwise comply with the Code of Judicial Ethics. The trial court construed the cause of action for constructive trust as one for constructive fraud, found plaintiff failed to allege the existence of a confidential or fiduciary relationship, and sustained the demurrer with leave to amend. The trial court also sustained the demurrer to the declaratory relief cause of action with leave to amend, finding plaintiff failed to allege a present or on-going relationship between the parties.
The second amended complaint contained causes of action for constructive fraud (first cause of action), fraudulent concealment (second cause of action), unconscionable fee (third cause of action), unjust enrichment (fourth cause of action), and declaratory relief (fifth cause of action). The court struck the second, third, and fourth causes of action as not having been filed in conformity with the law. Although absolute quasi-judicial immunity was among the grounds raised in the demurrer to the first and fifth causes of action, the demurrer to the first cause of action was sustained without leave to amend for failing to plead the existence of a fiduciary or special relationship (the same ground upon which the demurrer was sustained on the constructive trust cause of action in the first amended complaint), and the demurrer to the fifth cause of action (which was unopposed) was also sustained without leave to amend for failing to cure the initial defect. The matter was ultimately ordered dismissed by the trial court in September 2018, after plaintiff attempted unsuccessfully to file third and fourth amended complaints.
In October 2018, plaintiff sued defendant for damages based on the same set of facts alleged in the 2017 lawsuit. The first amended complaint alleged fraud (first cause of action); unconscionable fee (second cause of action); unjust enrichment (third cause of action); and fraudulent business practice (fourth cause of action). Plaintiff alleged defendant did not disclose that he had a conflict of interest, specifically that he had a history of "prior private judging relationships" with the attorney representing plaintiff's husband. Plaintiff alleged defendant was duty bound to make the disclosure under the terms of his appointment and the Code of Judicial Ethics, and that he intentionally concealed his conflict from plaintiff. Plaintiff sought compensatory and punitive damages in the amount of $1 million. Defendant demurred to the first amended complaint on several grounds, including failure to state a claim and absolute quasi-judicial immunity. In support of his absolute quasi-judicial immunity defense, defendant cited Howard v. Drapkin (1990) 222 Cal.App.3d 843 (Howard) and La Serena Properties, LLC v. Weisbach (2010) 186 Cal.App.4th 893 (La Serena Properties).
Plaintiff conceded the demurrer to the second and third causes of action without leave to amend. She opposed the demurrer as to the first cause of action for fraud, and sought leave to amend as to the fourth cause of action for fraudulent business practice. She argued that defendant was not immune from suit because a failure to disclose violates California Rules of Court, rules 3.904 and 3.924 (both requiring disclosures by referee consistent with the Code of Judicial Ethics), such that defendant never "became legally qualified to serve as a referee."
The trial court in a written order sustained the demurrer in its entirety without leave to amend. As to the contested causes of action, the court ruled: "The facts here allege that Defendant was appointed by the family court judge to act as a referee in Plaintiff's marital dissolution case. As pleaded, Defendant has judicial immunity from civil suits to the extent that his behavior as alleged was 'judicial,' even if allegedly 'corrupt.' The [first amended complaint] alleges Defendant had a conflict of interest which he did not disclose as required under judicial canons and state bar rules. Thus, the basis for the allegations was his allegedly unethical behavior in the exercise of judicial functions as a court-appointed referee. Accordingly, Plaintiff's causes of action are barred by principles of judicial immunity." The trial court denied leave to amend because plaintiff failed to demonstrate how to cure the defect. An order of dismissal was entered 10 months later, following an order to show cause issued to plaintiff's counsel for failing to appear at a previous hearing.
II. DISCUSSION
A. The Demurrer was Properly Sustained Without Leave To Amend on Grounds of Absolute Quasi-Judicial Immunity
We review de novo the trial court's order sustaining the demurrer. (Moore v. Regents of University of California (1990) 51 Cal.3d 120, 125.) "We assume the truth of all facts properly pleaded, and we accept as true all facts that may be implied or reasonably inferred from facts expressly alleged, unless they are contradicted by judicially noticed facts." (Cansino v. Bank of America (2014) 224 Cal.App.4th 1462, 1468.)
As in the trial court, plaintiff argues here that defendant is not protected by quasi-judicial immunity because he never provided the parties to the dissolution proceedings with a written conflict of interest disclosure. She contends that defendant's failure to disclose a history of serving as a private judge in cases in which counsel for plaintiff's husband represented one of the parties violated Canon 6D of the California Code of Judicial Ethics. The violation prevented defendant from "legally qualif[ying] to serve as a referee," and in turn receiving the protection of quasi-judicial immunity. Plaintiff's argument is foreclosed by the authorities cited by defendant in the trial court and here: Howard, supra, 222 Cal.App.3d 843 and La Serena Properties, supra, 186 Cal.App.4th 893.
In Howard, the appellate court held that "absolute quasi-judicial immunity is properly extended to [] neutral third parties for their conduct in performing dispute resolution services which are connected to the judicial process and involve either (1) the making of binding decisions, (2) the making of findings or recommendations to the court or (3) the arbitration, mediation, conciliation, evaluation or other similar resolution of pending disputes." (Howard, supra, 222 Cal.App.3d 843, 860.) The neutral in Howard was a psychologist hired to evaluate a child custody dispute. (Id. at p. 848.) The appellate court rejected the argument that the right to quasi-judicial immunity depends on the actor's status as a public official. (Id. at pp. 853-855.) In so doing, the court recognized that, "with the exception of arbitrators, and sometimes referees [citation], such functions have usually been performed by public officials." (Id. at p. 854.) The court described the litmus test for quasi-judicial immunity as whether the act performed by a non-public official (such as an arbitrator or referee) relates "to a function normally performed by a judge and where the parties understood they were dealing with the judge in [an] official capacity." (Id. at p. 854, and fn. 3.)
La Serena Properties involved the application of judicial immunity to an arbitrator who, as here, allegedly failed to make required disclosures involving conflicts of interest. (La Serena, supra, 186 Cal.App.4th 893, 897-900.) Citing Howard, the appellate court explained that the doctrine of absolute judicial immunity "has its roots in the English common law, and has been applied in this state for more than a century." (La Serena Properties, at p. 900.) The doctrine "protects judges from civil lawsuits for acts performed as part of the judicial function … [and] applies if the acts fall within the scope of the judicial function, even if the conduct complained of was malicious or corrupt." (Ibid.) The court held that the arbitrator's alleged failure to disclose falls within the scope of the absolute immunity for quasi-judicial acts. (Id. at p. 903.) Because "[a]rbitrators are mandated by law to make disclosures for precisely the same reasons that judges must do so[,] the process of making these disclosures is virtually identical to the" 'functions normally performed by judges." '" (Ibid.)
The appellant in La Serena Properties made the very argument advanced by plaintiff: That immunity does not apply because "the disclosure of potential conflicts was to occur before the arbitrator was finally accepted by the parties and before the arbitration commenced, and therefore, it was not part of the arbitration process." (La Serena Properties, supra, 186 Cal.App.4th 893, 905.) The same argument was explicitly rejected by the appellate court. "[T]he rules and statutes governing the disclosures by arbitrators make it clear that such disclosures are to occur when the arbitrator is 'proposed.' Similarly, judges are expected to make the disclosures required of them before the adjudicative function of the courts begin. … Therefore, any claimed misconduct by the arbitrator in association with the failure to make a required disclosure at the inception of his or her selection was sufficiently associated with the arbitration process itself to justify the application of arbitral immunity." (Ibid.)
The authorities cited by plaintiff are inapposite. The mandamus petitioner in Hayward v. Superior Court (2016) 2 Cal.App.5th 10 challenged the trial court's decision to delay a hearing on the petitioner's motion to set aside pre-disqualification rulings of a temporary judge who had acted in a dissolution proceeding. (Id. at p. 16.) Upon learning that the temporary judge had not disclosed a personal or professional relationship with lawyers in the proceeding as required by the Code of Judicial Ethics, the petitioner filed a statement in the trial court alleging grounds for the temporary judge's disqualification. (Ibid.) The presiding judge ordered the temporary judge disqualified and reassigned the case. (Ibid.) The appellate court held that the temporary judge's failure to respond to the disqualification statement was a concession to the truth of the disqualification allegations (id. at p. 37), and that because the facts creating the disqualification arose before the disqualified judge had made any rulings, all ensuing orders of the temporary judge were void. (Id. at pp. 41, 44.) Jolie v. Superior Court (2021) 66 Cal.App.5th 1025 similarly addressed a challenge to the denial of a request to disqualify a temporary judge assigned in a family law case. (Id. at p. 1031.)
Hayward and Jolie involved writs directed at orders issued in matters pending in the trial court; neither implicates the doctrine of quasi-judicial immunity. Here, plaintiff is not challenging interlocutory rulings in an ongoing trial court proceeding-her dissolution became final in 2018 (and she is prosecuting a separate appeal in that case). The instant appeal is in an ancillary civil action for damages. Even if defendant had been disqualified in the trial court, and his orders had been rendered void, quasi-judicial immunity bars plaintiff from suing defendant to recover damages.
B. Plaintiff's Appeal Contravenes the California Rules of Court and The State Bar Rules of Professional Conduct
Defendant asks us to sanction plaintiff and her attorney, Robert J. Tennant, for filing and prosecuting a clearly frivolous appeal. In a supporting declaration, counsel states that defendant has expended over $23,000 in attorney's fees and costs defending himself against plaintiff's actions over the past five years, including $12,110 in attorney's fees to defend against the instant appeal and move for sanctions. Defendant seeks sanctions in the amount of $12,000 payable to himself, and in the amount of $8,000 payable to this court for the harm done by plaintiff to the court and the public as a result of the frivolous appeal. We notified the parties of our intent to consider sanctions in this matter, and we invited plaintiff to respond to defendant's motion. (See Cal. Rules of Court, rule 8.276.) We have considered plaintiff's opposition presented both in writing and at oral argument. Although we decline to impose sanctions, our opinion must not be interpreted as condoning plaintiff's conduct or attorney Tennant's actions, which transgress both the California Rules of Court and the State Bar Rules of Professional Conduct.
An appellate brief must "[s]tate each point under a separate heading or subheading summarizing the point, and support each point by argument and, if possible, by citation of authority." (Cal. Rules of Court, rule 8.204(a)(1)(B).) Attorney Tennant has violated this rule by failing to present any argument or legal authority demonstrating trial court error. (See Benach v. County of Los Angeles (2007) 149 Cal.App.4th 836, 852.) The sole argument presented on appeal is that by failing to disclose a conflict of interest required by the Code of Judicial Ethics, defendant was never "legally qualified" to serve as a court-appointed referee and is therefore not cloaked with quasi-judicial immunity. That very argument was squarely rejected in La Serena Properties, as derived from Howard. But significantly, plaintiff does not cite La Serena Properties nor Howard anywhere in her briefing in this court, much less contend that either case was wrongly decided. Even after defendant raised the directly applicable authorities in his brief, plaintiff failed to address them in her reply brief. Instead, plaintiff asserts defendant violated the Code of Judicial Ethics and she challenges the validity of defendant's rulings in her underlying dissolution matter-points which are not relevant to the narrow question presented by this appeal: whether defendant may be sued civilly for damages.
Rule 3.1(a)(1) of the State Bar Rules of Professional Conduct provides that a lawyer shall not "bring or continue an action, conduct a defense, assert a position in litigation, or take an appeal, without probable cause and for the purpose of harassing or maliciously injuring any person." Attorney Tennant's conduct in this appeal infringes upon that rule, as plaintiff's briefing is devoid of any authority that would even colorably undermine the application of absolute quasi-judicial immunity here. Her appeal is taken without probable cause and is frivolous. (In re Marriage of Flaherty (1982) 31 Cal.3d 637, 649 [an appeal "should be held to be frivolous … when any reasonable attorney would agree that the appeal is totally and completely without merit"].) Further, plaintiff's litigation history suggests that this appeal was filed to harass defendant.
Representing herself, plaintiff filed a complaint in 2015 alleging professional negligence against a court-appointed accountant who prepared reports in the dissolution proceeding. The complaint was stricken under the anti-SLAPP statute, and the accountant was awarded attorney's fees and costs. Plaintiff was deemed a vexatious litigant in the dissolution proceeding in September 2016, and that prefiling order remains active according to the list of vexatious litigants compiled and maintained by the Judicial Council of California (https://courts.ca.gov/documents/vexlit.pdf [as of September 2022], archived at Perma | courts.ca.gov).
Represented by attorney Tennant, plaintiff subpoenaed defendant three times to testify in the dissolution matter, despite defendant's immunity from subpoena. Plaintiff and attorney Tennant were sanctioned $1,000 by the trial court in September 2017, and ordered not to subpoena defendant without prior court approval. Attorney Tennant also sought our review of several interlocutory orders in the dissolution matter. Five appeals were dismissed either as taken from nonappealable orders or for failure to prosecute; and three writ petitions relating to judicial assignments were denied.
Attorney Tennant and plaintiff filed a first amended complaint against defendant in December 2017, less than three months after they were sanctioned by the trial court. The first amended complaint was dismissed with leave to amend, and a second amended complaint was dismissed with prejudice in September 2018. The following month, attorney Tennant and plaintiff initiated the action underlying this appeal by filing another complaint in the trial court under a new 2018 cause number. The 2017 and 2018 lawsuits are virtually identical, as the gravamen of the complaints is the same in both cases. After failed attempts to file a third and fourth amended complaint in the 2017 case, plaintiff served defendant with a first amended complaint in the 2018 case. The demurrer to that complaint was sustained without leave to amend, and the matter was ultimately dismissed with prejudice consistent with that ruling.
Plaintiff is a vexatious litigant, and attorney Tenant filed and prosecuted the instant appeal instead of protecting the court from vexatious filings (see Shalant v. Girardi (2011) 51 Cal.4th 1164, 1176 [as officers of the court, attorneys serve as gatekeepers against frivolous litigation]). Their actions have resulted in a time- consuming and disruptive use of the judicial process. (In re Marriage of Flaherty, supra, 31 Cal.3d 637, 650.)
III. DISPOSITION
The judgment is affirmed. Costs on appeal are awarded to respondent, by operation of California Rules of Court, rule 8.278(a)(2).
Respondent's motion for sanctions is denied. That denial notwithstanding, the clerk of this court shall forward a copy of this opinion to the State Bar of California. (Cal. Code Jud. Ethics, canon 3D(2).)
WE CONCUR: Manoukian, Acting P. J., Wilson, J.