Opinion
D076903
02-16-2021
K.G., a Minor, etc., Plaintiff and Appellant, v. S.B., Defendant and Respondent.
Robert A. Waller, Jr.; RomanCore Law and Robert Radulescu, for Plaintiff and Appellant. Fell Law, Bibianne U. Fell, and Trevor Fell, for Defendant and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super. Ct. No. 37-2018-00029143-CU-PO-CTL) APPEAL from an order of the Superior Court of San Diego County, Eddie C. Sturgeon, Judge. Affirmed. Robert A. Waller, Jr.; RomanCore Law and Robert Radulescu, for Plaintiff and Appellant. Fell Law, Bibianne U. Fell, and Trevor Fell, for Defendant and Respondent.
I
INTRODUCTION
This appeal is from an order of costs entered by the trial court after it dismissed a wrongful death action against S.B. (Father). K.G. (Plaintiff) contends the trial court erred in denying his motion to strike Father's memorandum of costs based on standing. He contends Father did not actually incur the $2,904 costs awarded him because Father settled a coverage dispute with his insurer in which the insurer asserted a reservation of rights. Plaintiff also contends the court abused its discretion in denying a motion to compel compliance with a deposition subpoena for production of records regarding the settlement agreement between Father and his insurer in the coverage dispute. We disagree with Plaintiff's contentions and affirm the order.
II
BACKGROUND
Because the underlying facts of the case are not necessary for consideration of the issues in this appeal, we focus primarily on the procedural history.
A
Plaintiff, a minor, sued Father for negligence alleging Father was responsible for the overdose death of Plaintiff's mother because Father provided his adult son with financial support and the son used that money to purchase drugs for himself and Plaintiff's mother. Plaintiff also alleged Father allowed his son to use the vehicle in which Plaintiff's mother died. The trial court entered a judgment of dismissal after sustaining Father's demurrer to the negligence cause of action without leave to amend.
Plaintiff dismissed a cause of action asserting Father negligently entrusted the vehicle to his son. (K.G. v. S.B. (2020) 46 Cal.App.5th 625, 629 (K.G. I).)
In the prior appeal, we affirmed the judgment of dismissal concluding Father had no legal duty to Plaintiff to control the conduct of Father's son. The alleged facts did not demonstrate Father had an ability to control his son's conduct or prevent his son or Plaintiff's mother from obtaining drugs even if Father withheld financial support. (K.G. I, supra, 46 Cal.App.5th at pp. 631632.) We further concluded public policy did not support extending liability to a parent for providing financial support to an adult child. (Id. at pp. 632633.)
B
Father filed a memorandum of costs seeking a total of $3,386 for filing and motion fees, deposition costs, fees for service of process, and court reporter fees. He provided invoices supporting the requested costs, all of which were incurred before the entry of judgment.
Plaintiff moved to strike or tax the memorandum of costs. Plaintiff contended Father did not incur the requested costs and was not responsible for reimbursing his insurance carrier because Father and his insurance carrier settled a lawsuit in which the carrier had sought declaratory relief and reimbursement of fees and costs expended to defend uncovered claims in the wrongful death action. Plaintiff argued an award of costs would result in an unjust financial windfall to Father if he was not obligated to pay or repay the costs. Alternatively, Plaintiff asked the court to tax certain costs as unnecessary.
Father opposed the motion stating there was no evidence his insurance carrier agreed to waive its rights to indemnity or reimbursement for defending him in the wrongful death action and, even if such an agreement existed, it did not preclude his recovery of incurred costs as the prevailing party. He also opposed the motion to tax certain costs for copies of depositions, service of process, and court reporter fees.
C
Plaintiff issued record subpoenas to the law firms representing both Father and Father's insurance carrier in the coverage action. Both subpoenas sought production of "[a]ny and all settlement agreements, release of claims, indemnity agreements, documents, emails, correspondence and/or any other writings or things evidencing all terms and conditions of settlement" between the insurance carrier and Father in the coverage litigation.
Counsel for the custodian of records for the insurance carrier's firm objected to the deposition subpoena as seeking irrelevant and confidential settlement information as well as privileged communications.
Plaintiff moved to compel compliance with the subpoenas. The law firm for the insurance carrier opposed the motion to compel. It argued Father, as the prevailing party, was statutorily entitled to recover approved costs incurred, whether the costs were paid out of his pocket or advanced by the insurance carrier. The carrier's firm also argued the terms of any settlement of the coverage dispute were irrelevant to an award of costs in the wrongful death action.
D
The trial court denied both the motion to compel and Plaintiff's motion to strike Father's memorandum of costs. However, the court taxed three items of costs. It disallowed the requested deposition costs and reduced the requested costs for service of process and court reporter fees. The court awarded Father a total of $2,903 in costs.
III
DISCUSSION
A
Father is Entitled to Recover Costs
Plaintiff contends Father did not actually incur the costs awarded since he is not obligated to reimburse costs advanced by his insurer. Therefore, Plaintiff reasons, Father lacks standing for a cost award. We disagree.
As Plaintiff correctly acknowledges, the right to recover costs is governed entirely by statute. (Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 989.) We independently review questions of statutory interpretation and application. (Carmel Development Company. Inc. v. Anderson (2020) 48 Cal.App.5th 492, 503; Litt v. Eisenhower Medical Center (2015) 237 Cal.App.4th 1217, 1221 [de novo review of whether court misapplied a statute] (Litt); see also San Luis Rey Racing, Inc. v. California Horse Racing Board (2017) 15 Cal.App.5th 67, 73 ["standing and the interpretation of statutes are questions of law to which we typically apply a de novo standard of review"].)
The relevant cost statutes provide as follows: "Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding." (Code Civ. Proc., § 1032, subd. (b).) "Costs are allowable if incurred, whether or not paid." (Id., § 1033.5, subd. (c)(1).)
There is no question Father is a party named in the action and has standing as the person subjected to the jurisdiction of the court. (Code Civ. Proc., § 422.40.) His insurer is not a party to this action and need not intervene because Father is a valid party. (Kaufman & Broad Communities, Inc. v. Performance Plastering, Inc. (2006) 136 Cal.App.4th 212, 216.)
We have held that, "Under the code's cost-shifting provisions, there is 'no requirement that a party claiming costs must have personally incurred the obligations enumerated in the memorandum.' " (Litt, supra, 237 Cal.App.4th at p. 1222.) In reaching this conclusion we observed that defendants incur " 'legal liability to pay the costs of litigation even though some other party may have agreed to reimburse them or to pay all the expenses of the litigation.' " (Ibid., quoting Ceranski v. Muensch (1943) 60 Cal.App.2d 751, 754 (Ceranski); Skistimas v. Old World Owners Assn. (2005) 127 Cal.App.4th 948, 952 ["Whether the individual defendants paid the fees out of their own pockets or their insurer paid the fees on their behalf should not be determinative of their right to recover those fees."].)
Plaintiff acknowledges these established precedents, but tries to distinguish this case by arguing that these cases require the prevailing party to have an obligation to reimburse the insurance carrier or other entity who agreed to pay the costs before the party may recover them. He contends that if Father and his insurer settled the insurance coverage dispute between them, it must mean that Father neither incurred the costs himself nor is obligated to reimburse the insurance carrier for any costs they expended. This is not the law.
Such a repayment requirement reads more into the statute than is required and is not supported by authorities upon which he relies. Plaintiff cites a passage in Ceranski, in which the court recited the positions of the parties on a motion to strike costs and noted the defendants pointed to a subrogation clause in the insurance contract stating, " 'in the event of any payment under this policy the Company shall be subrogated to all the insured's rights to recover therefor.' " (Ceranski, supra, 60 Cal.App.2d at p. 754.) However, the Ceranski court did not rely on the subrogation clause to reach its decision; it relied on the language of the cost statutes to affirm the award. (Ibid.) The court explained, "It must be taken for granted that [the defendant] expended a sum of money to procure the insurance policy by which the insurance carrier agreed to pay the costs of the defense of an action brought against [him or her] for damages. The fact that [a defendant] thus procured the means of defending [himself or herself] in actions of this character does not furnish an avenue for [a plaintiff] to escape the obligation which [he or she] incurred when [he or she] unsuccessfully attempted to collect damages from [the defendant] by an action at law." (Id. at pp. 754-755.)
A subrogation clause allows an insurer who has paid a loss to step into the shoes of an insured to pursue the insured's rights to recover against a third party. (Employers Mutual Liability Ins. Co. v. Tutor-Saliba Corp. (1998) 17 Cal.4th 632, 639; Progressive West Ins. Co. v. Superior Court (2005) 135 Cal.App.4th 263, 272.) --------
There can be no dispute that the costs awarded by the trial court were actually incurred to defend Father in this action. There is no indication the court waived the filing and motion fees or that the vendors who issued invoices for service of process and court reporting fees did not actually seek payment for the services they rendered for Father's defense. How Father arranged to meet these obligations is beyond the express terms of Code of Civil Procedure section 1033.5, subdivision (c)(1), which states, "Costs are allowable if incurred, whether or not paid." (Italics added.)
Here, Father purchased automobile insurance. When Plaintiff sued, Father tendered his defense of the action to his insurance carrier. The insurer agreed to defend Father pursuant to a reservation of rights to deny coverage for claims it contended were not covered by the policy. Nevertheless, in accordance with its duty to defend, the insurer retained counsel and incurred fees and costs related to Father's defense. The insurer then filed an action for declaratory relief seeking resolution of the coverage dispute and sought reimbursement from Father of costs and fees it expended for uncovered claims. After the trial court entered judgment in favor of Father in the wrongful death action, the insurance carrier dismissed its coverage action.
Whether the insurer decided to pay the costs without seeking reimbursement or whether it required Father to pay the costs out of pocket as uncovered claims has no bearing on whether the requested costs were incurred for Father's defense. Likewise, how any costs Father recovers are ultimately disbursed is a matter between Father, his insurer, his attorneys, and the vendors seeking payment. (See Lolley v. Campbell (2002) 28 Cal.4th 367, 373, fn. 2 [a party's right to seek an award of statutory fees "is not equivalent to a right to retain such fees"]; Ketchum v. Moses (2001) 24 Cal.4th 1122, 1131 [attorney fees may be recovered even where a client is not obligated to pay]; Rosenaur v. Scherer (2001) 88 Cal.App.4th 260, 287 [same].)
Father is statutorily entitled to recover the allowable costs incurred to defend this action on his behalf. (Code Civ. Proc., §§ 1032, subd. (b), 1033.5, subd. (c)(1).) It would be inappropriate to allow Plaintiff to escape his obligation to pay the costs to which Father is statutorily entitled because Father obtained his defense through a contractual arrangement with his insurance carrier, even if he settled a coverage dispute regarding uncovered claims. (Ceranski, supra, 60 Cal.App.2d at pp. 754-755.) Therefore, the court properly denied the motion to strike.
B
No Abuse of Discretion in Denying Motion to Compel
Plaintiff also contends the trial court erred in denying his motion to compel compliance with the subpoenas for records regarding any settlement between Father and his insurer because the documents were relevant and probative of Father's standing to pursue recovery of costs. We do not agree.
" ' "Under the discovery statutes, information is discoverable if it is unprivileged and is either relevant to the subject matter of the action or reasonably calculated to reveal admissible evidence." ' [Citation.] 'Discovery may relate to the claim or defense of the party seeking discovery or of any other party to the action.' (Code Civ. Proc., § 2017.010.) 'In reviewing an order of a superior court [regarding] discovery, we recognize at the threshold that "the discovery statutes vest a wide discretion in the trial court in granting or denying discovery" and "such exercise [of discretion] may only be disturbed when it can be said that there has been an abuse of discretion." ' " (John B. v. Superior Court (2006) 38 Cal.4th 1177, 1186.)
Plaintiff complains the trial court denied the motion to compel "without explanation." However, the hearing was not reported and Plaintiff elected to proceed without a record of the oral proceedings by either an agreed or settled statement. Therefore, we cannot assess anything the court may have said with respect to the ruling to determine if there was an abuse of discretion. " 'In the absence of a contrary showing in the record, all presumptions in favor of the trial court's action will be made by the appellate court.' " (Jameson v. Desta (2018) 5 Cal.5th 594, 609; Southern California Gas Co. v. Flannery (2016) 5 Cal.App.5th 476, 483 [a record of oral proceedings may be indispensable in cases reviewed for abuse of discretion].)
Nevertheless, based on the record before us, we conclude the requested discovery was not relevant to the issue of whether Father was entitled to recover costs in this action. As we explained in section III.A., ante, Father is statutorily entitled to recover costs incurred for his defense of this matter and "the actual payor is irrelevant." (Litt, supra, 237 Cal.App.4th at pp. 1222-1223.) Therefore, the trial court did not abuse its discretion in denying the motion to compel.
IV
DISPOSITION
The order is affirmed. Father shall recover his costs on appeal.
McCONNELL, P. J. WE CONCUR: BENKE, J. DATO, J.