Abraham v. Neilson

Filed 7/19/07 Abraham v. Neilson CA3

NOT TO BE PUBLISHED

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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

THIRD APPELLATE DISTRICT

(Sacramento)

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Mark Abraham and Abraham & Associates Insurance Services, Inc., appeal from a judgment of dismissal after the trial court dismissed the action for failure to bring to trial within five years. (Code Civ. Proc., 583.310.) They contend (1) it was impossible to bring the suit to trial within five years because defense counsel was unavailable; (2) defendants are estopped from asserting the five-year statute; and (3) the five-year period was tolled when defendants were the cause of the delay. Because plaintiffs were not diligent in prosecuting the case, and because the final continuance was due to their lack of diligence, we reject these contentions and affirm.

BACKGROUND

On December 22, 2000, a complaint for damages alleging defamation and related torts was filed. Plaintiffs were Mark R. Abraham, doing business as (dba) Abraham and Associates Insurance Services, Inc.; David L. Hosford, dba Hosford Insurance Agency, Inc.; and Jerry L. Keenan, dba Sacramento Auto Insurance Center, Inc./Cost U Less Insurance Center. The named defendants were David G. Neilson and Andrew Byer, individually and dba Neilson-Byers Insurance and Golden Oaks Insurance Agency. Only Neilson-Byers Insurance and Golden Oaks Insurance Agency were alleged to be corporations.

In 2002, the matter went to nonbinding arbitration. Plaintiffs were awarded damages. Defendants rejected the arbitration award and requested a trial de novo.

In September 2003, defendants moved for summary judgment. The motion asserted that the individual plaintiffs were not damaged by the alleged defamatory communications and the corporate entities were not parties to the litigation.

Two months later, on November 25, 2003, a tentative ruling indicated the courts intent to deny the motion. The court noted the complaint alleged plaintiffs were doing business as unincorporated sole proprietorships, but the evidence submitted in opposition to the motion showed the insurance agencies were separate corporations. The ruling stated, Plaintiffs must seek leave to amend if the corporations are separate legal entities and are seeking damages.

Shortly after the tentative ruling, the matter was continued due to the death of the son of counsel for Hosford. The following March, the matter was continued again due to the birth of the second child to counsel for Abraham.

Days after this continuance, the court issued its final ruling on the summary judgment motion, denying the motion. The ruling noted that Keenan, a third plaintiff, had dismissed his claims. The court repeated its advisement that the plaintiffs needed to seek leave to amend to name the insurance agency corporations as plaintiffs.

In May and November 2004, plaintiffs sought to continue the trial date. By stipulation of all parties, the motions to continue were granted.

On November 23, 2004, one year after the pleading problem for the corporate plaintiffs was cited in the tentative ruling, plaintiffs commenced the lengthy endeavor to amend the complaint. First, Abraham applied ex parte for an order allowing amendment to the complaint. The amendment would change the name of plaintiff Mark R. Abraham d/b/a Abraham & Associates, to Mark R. Abraham, an individual, and Abraham & Associates Insurance Services, Inc., a California Corporation.

Defendants moved to strike the amendment, arguing it was not done in compliance with the law. They asserted the amendment made a substantive change, adding a new plaintiff, rather than correcting a clerical error, and could not be accomplished without a noticed motion. The court granted the motion to strike.

Plaintiffs then moved for leave to file an amended complaint to add two corporate entities as plaintiffs. The trial court tentatively granted the motion, noting [p]laintiffs have been less than diligent in correcting this error, which should have been accomplished months ago. After hearing on the matter, the court reversed its ruling because plaintiffs failed to serve a copy of the proposed amended complaint on defendants. The court again noted plaintiffs lack of diligence.

A third attempt to amend the complaint was successful in June 2005. In opposition, defendants criticized plaintiffs dilatory conduct, noting the five-year period in which to bring the case to trial would expire in six months and the amendment would require a new trial date. In granting the motion, the trial court acknowledged plaintiffs lack of diligence. Plaintiffs lack of diligence and previous procedural errors are annoying to the court and frustrating to defendants. Responding to defendants claim that the late amendment prejudiced them, the ruling was without prejudice to defendants filing a motion to continue the trial should they deem such to be necessary to protect their interests following the amendment to the complaint.

Defendants demurred to the amended complaint; the demurrer was sustained in part. They moved for summary judgment, which was denied.

On November 4, 2005, over four years and ten months after the suit was filed, defendant moved to continue the trial date of November 28, 2005. The motion recited that defendants had propounded written discovery upon plaintiffs and had scheduled depositions of those most knowledgeable about the corporate plaintiffs damage claims. The documents requested had not been produced and, without the documents, the depositions had been postponed. The documents had still not been produced and even if they were in the near future, defense counsel had another trial scheduled to begin November 7, 2005. That trial was expected to last eight to ten days or several weeks.

Plaintiffs did not oppose the motion to continue and it was granted. A trial setting conference was set for December 5, 2005. The record does not show that plaintiffs apprised the court that the five-year deadline was near. They did not move to specially set the trial date. A trial date of March 27, 2006, was set.

On January 11, 2006, defendants moved to dismiss the action for failure to bring it to trial for five years. The trial court granted the motion, finding no tolling of the five-year period and no facts to support estoppel.

Judgment was entered in favor of defendants.

Only plaintiffs Mark Abraham and Abraham & Associates Insurance Services, Inc. (collectively Abraham) appeal from the judgment.

DISCUSSION

Code of Civil Procedure section 583.310 provides: An action shall be brought to trial within five years after the action is commenced against the defendant. (All further statutory references are to the Code of Civil Procedure.) Dismissal is mandatory if the action is not brought to trial within the statutory period. Section 583.360 states: An action shall be dismissed by the court on its own motion or on motion of the defendant, after notice to the parties, if the action is not brought to trial within the time prescribed in this article. [] (b) The requirements of this article are mandatory and are not subject to extension, excuse, or exception except as expressly provided by statute.

The purpose of the five-year dismissal statute is to prevent the prosecution of stale claims where defendants could be prejudiced because evidence is lost or the memory of witnesses is dimmed. It also protects defendants from the annoyance of having unmeritorious claims against them unresolved for unreasonable periods of time. (Lewis v. Superior Court (1985) 175 Cal.App.3d 366, 375.)

In calculating the five-year period, the time during which bringing the action to trial was impossible, impracticable or futile shall be excluded. ( 583.340, subd. (c).) What is impossible, impracticable, or futile is determined in light of all the circumstances of a particular case, including the conduct of the parties and the nature of the proceedings. The critical factor is whether the plaintiff exercised reasonable diligence in prosecuting its case. [Citation.] The statute must be liberally construed, consistent with the policy favoring trial on the merits. (Brown & Bryant, Inc. v. Hartford Accident & Indemnity Co. (1994) 24 Cal.App.4th 247, 251.)

Reasonable diligence places on a plaintiff the affirmative duty to make every reasonable effort to bring a case to trial within five years, even during the last month of its statutory life. [Citation.] [] Time consumed by the delay caused by ordinary incidents of proceedings, like disposition of demurrer, amendment of pleadings, and the normal time of waiting for a place on the court's calendar are not within the contemplation of these exceptions. [Citation.] Moreover, reasonable diligence alone is not sufficient to protect a party from an involuntary dismissal; rather, reasonable diligence constitutes a guideline by which to assess the existing exceptions of impossibility, impracticability, or futility. [Citation.] (Baccus v. Superior Court (1989) 207 Cal.App.3d 1526, 1532.)

In determining whether the exceptions for impossibility, impracticability or futility apply, not every period of time during which plaintiff does not have the power to bring the case to trial is excluded in calculating the five years. (Sierra Nevada Memorial-Miners Hospital, Inc. v. Superior Court (1990) 217 Cal.App.3d 464, 472.) [T]here must be a causal connection between the circumstance upon which plaintiff relies and the failure to satisfy the five-year requirement. Bringing the action to trial must be impossible, impracticable, or futile for the reason proffered. (Id. at p. 473.)

The determination of whether the impossibility exception to the five-year statute applies is a matter for the trial courts discretion and we will not disturb that determination on appeal unless an abuse of discretion is shown. (Sanchez v. City of Los Angeles (2003) 109 Cal.App.4th 1262, 1271.)

Abraham contends it was impracticable to bring this case to trial within five years because counsel for defendants was unavailable for the final trial date of November 28, 2005, due to a conflicting trial and the need to conduct further discovery. Because there was no causal connection between defense counsels schedule and the failure to bring the action to trial in five years, the trial court did not abuse its discretion in not applying the impracticability exception.

In the course of five years it is reasonable to expect counsel will unavailable at times due to conflicting work schedules. (See Sierra Nevada Memorial-Miners Hospital, Inc. v. Superior Court, supra, 217 Cal.App.3d 464, 472 [reasonable to expect counsel to be unavailable at times due to illness].) Such ordinary and usual time periods where plaintiff cannot literally bring the matter to trial are not excluded under the impossible, impracticable or futile standard. (Ibid.)

For the tolling provision of section 583.340 to apply, there must be a period of impossibility, impracticability or futility, over which plaintiff had no control . . . . [Citation.; italics added.] (Sanchez v. City of Los Angeles, supra, 109 Cal.App.4th 1262, 1273 [death of attorney for one defendant did not give rise to period of impracticality].) Here, the reason the final trial date was so close to the expiration of the five-year period, such that any unavailability of counsel would push the trial beyond the five-year period, was that plaintiffs were not diligent in amending the complaint to add the corporate plaintiffs so the trial could proceed. After the trial court alerted them to the problem, it took over a year and a half -- and three attempts due to procedural errors -- to amend the complaint. Even after the amendment, the dilatory conduct continued as plaintiffs failed to provide defendants with discovery. It was plaintiffs lack of diligence, not defense counsels work schedule, that caused the case to miss the five-year mark. Where plaintiff is the dilatory party, impracticability is not an excuse because the impracticability rises from plaintiffs own fault. (Westinghouse Electric Corp. v. Superior Court (1983) 143 Cal.App.3d 95, 106.)

The critical factor in applying the impracticability exception to the five-year statute is whether plaintiff exercised reasonable diligence in prosecuting his case. (Moran v. Superior Court (1983) 35 Cal.3d 229, 238.) Because plaintiffs were not diligent and because their lack of diligence, both in amending the complaint and failing to provide discovery, caused the case not to go to trial within five years, Abrahams claims that it was impracticable to bring the case to trial in five years and that defendants caused the final delay fail.

Abraham next contends that defendants were estopped from seeking dismissal because they moved to continue the last trial date. Abraham describes defendants motion for a continuance as clandestine and their conduct as deceptive. Abraham contends the trial court abused its discretion in finding no facts to support estoppel because it ignored counsels representation that he was unavailable. Abraham asserts defendants thus represented that they intended to proceed to trial after a short continuance.

The equitable doctrine of estoppel applies to motions under section 583.310. ( 583.140 [Nothing in this chapter abrogates or otherwise affects the principles of waiver and estoppel.].) If a trial court encounters statements or conduct by a defendant which lulls the plaintiff into a false sense of security resulting in inaction, and there is reasonable reliance, estoppel must be available to prevent defendant from profiting from his deception. (Borglund v. Bombardier, Ltd. (1981) 121 Cal.App.3d 276, 281 (Borglund).)

In Holder v. Sheet Metal Workers Internat. Assn. (1981) 121 Cal.App.3d 321 (Holder), the three-year period for bringing a case to trial after reversal on appeal was at issue. The trial date was set within the three-year period, but after receiving letters and communications from defendants counsel outlining his calendar conflicts and motivated by professional courtesy, plaintiffs counsel agreed not to oppose a continuance. The new trial date was beyond the three-year period and defendant successfully moved to dismiss. (Id. at p. 324.) The appellate court reversed, finding defendants selection of a trial date beyond the three-year period, showed his willingness to excuse delay and his apparent satisfaction with his state of preparedness for trial. (Id. at p. 327.)

We find Borglund, supra, 121 Cal.App.3d 276,and Holder, supra, 121 Cal.App.3d 321 distinguishable. Here there were no statements or conduct that could reasonably lull Abraham into a false sense of security resulting in inaction. To the contrary, it was defendants, not plaintiffs, who raised the five-year deadline. In opposing the motion to amend the complaint, defendants raised the issue of the looming five-year deadline, arguing an amendment would result in loss of the current trial date and with the addition of new plaintiffs no trial date could be scheduled for an indefinite period of time. In granting the motion to amend, the court expressly provided that defendants would be allowed to continue the trial date if necessary. Defendants motion to continue was hardly clandestine; it was foreshadowed in the dispute over amending the complaint.

Abraham stresses that in moving for a continuance, counsel for defendant represented that he was unavailable due to another trial. Clinging to this one fact, while ignoring the remaining circumstances of the case and the abundant evidence of plaintiffs lack of diligence, Abraham insists the final delay was chargeable solely to defendants. Abraham is unpersuasive. The record shows it was plaintiffs lack of diligence in moving the case forward that caused the time crunch presented in November 2005. Even without a calendar conflict, defendants were unable to proceed to trial because plaintiffs had failed, despite several requests, to provide discovery on the new corporate plaintiffs. In short, as the trial court found, the reason the case could not go to trial within the five-year period was unequivocally due to dilatory actions by plaintiffs, not due to any deceptive conduct by defendants. The trial court did not err in rejecting Abrahams claim of estoppel.

DISPOSITION

The judgment is affirmed.

MORRISON , J.

We concur:

SIMS , Acting P.J.

NICHOLSON , J.

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