BROWN v.TEHAMA COUNTY BOARD OF SUPERVISORS

Filed 3/16/07 (appen. not included with computer version)

CERTIFIED FOR PARTIAL PUBLICATION^*

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

THIRD APPELLATE DISTRICT

(Tehama)

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STORY CONTINUED FROM PART II

II

The CountyDefendants And The Peoples Appeals

From The Attorney Fees Award

The county defendants challenge the award of attorney fees against them on several bases. First, they contend the private attorney general statute (Code Civ. Proc., 1021.5) does not authorize an award of attorney fees to the Attorney General under the circumstances of this case, if ever. Second, they contend that even if the Attorney General can, in some circumstances, qualify for a fee award under this statute, the Peoples personal interests in this particular litigation make a fee award inappropriate here. Finally, the county defendants contend the trial court abused its discretion in basing the fee award on perceived misconduct by their attorney rather than on the statutory criteria.

For their part, the People challenge the fee award as inadequate. They agree with the county defendants that the trial courts sua sponte imposition of attorneys fees as sanctions for the vexatious behavior of the County was procedurally improper, but contend Code of Civil Procedure section 1021.5 authorize[s] a full award of attorneys fees to the State in this case. They contend we should reverse the fee award and remand the case to the trial court to reconsider the matter.

A

The Obdurate Behavior Rule

We begin with the issue on which both sides agree -- whether the trial courts rationale for awarding attorney fees under Code of Civil Procedure section 1021.5 was flawed. To answer that question, we turn to the language of the statute, which in relevant part provides as follows: Upon motion, a court may award attorneys fees to a successful party against one or more opposing parties in any action which has resulted in the enforcement of an important right affecting the public interest if: (a) a significant benefit, whether pecuniary or nonpecuniary, has been conferred on the general public or a large class of persons, (b) the necessity and financial burden of private enforcement, or of enforcement by one public entity against another public entity, are such as to make the award appropriate, and (c) such fees should not in the interest of justice be paid out of the recovery, if any. With respect to actions involving public entities, this section applies to allowances against, but not in favor of, public entities . . . unless one or more successful parties and one or more opposing parties are public entities . . . .

[T]he Legislature adopted [Code of Civil Procedure] section 1021.5 as a codification of the private attorney general attorney fee doctrine that had been developed in numerous prior judicial decisions. (Woodland Hills Residents Assn., Inc. v. City Council (1979) 23 Cal.3d 917, 933.) Entitlement to fees under [Code of Civil Procedure] section 1021.5 requires a showing that the litigation: (1) served to vindicate an important public right; (2) conferred a significant benefit on the general public or a large class of persons; and (3) imposed a financial burden on plaintiffs which was out of proportion to their individual stake in the matter. (California Licensed Foresters Assn. v. State Bd. of Forestry (1994) 30 Cal.App.4th 562, 569, quoting Baggett v. Gates (1982) 32 Cal.3d 128, 142.)

Purporting to apply the statutory criteria, the trial court concluded the ordinary costs of litigation that the [People] have incurred here did not confer a benefit on the public that transcends their interest in the controversy, that is out of proportion to the [People]s interest in this matter. No doubt, the public interest of the state at large has been well-served by this litigation; but serving the interests of the state at large is the public responsibility of these plaintiffs . . . .

Despite this conclusion, the court went on to examine what it believed was another aspect of the private attorney general doctrine -- the obdurate behavior rule. In the trial courts assessment, where a plaintiff has succeeded in conferring a substantial benefit on the general public, it is appropriate under Code of Civil Procedure section 1021.5 to pass on that portion of the attorney fees incurred for the financial burden that was created by the obdurate behavior of the defendants. Applying this aspect of Code of Civil Procedure section 1021.5, the trial court concluded the People should recover $173,450 in attorney fees because the manner in which the litigation was conducted by the County defendants caused the time and expense of this litigation to be expanded enormously. According to the trial court, the services of one deputy attorney general and one paralegal were entirely attributable to the unnecessary and vexatious procedures pursued by the county defendants, and the amount of time the lead deputy attorney general spent on the case was increased by at least a third as a result of the vexatious and obdurate . . . tactics that were used. Thus, the court concluded the necessity and financial burden of these expenses are such as to make an award of these fees appropriate.

We agree with the People and the county defendants that the trial courts rationale for awarding $173,450 in fees under Code of Civil Procedure section 1021.5. was erroneous. Contrary to the trial courts conclusion, that statute does not allow an award of fees based on a defendants obdurate behavior during the litigation.

The trial courts error in this regard stemmed from a misreading of this courts opinion in County of Inyo v. City of Los Angeles (1978) 78 Cal.App.3d 82. In that case, Inyo County moved for an award of attorney fees against the City of Los Angeles in a writ proceeding in which the county had succeeded in requiring the city to prepare an environmental impact report covering the citys increased extraction and use of Owens Valley groundwater. (Id. at pp. 84-85.) This court noted the general American doctrine which denies attorney fees to victorious litigants unless provided by statute or contract, then observed that Inyo Countys fee application is grounded on three rules or theories which various courts have recognized as nonstatutory exceptions to the general doctrine: the private attorney general rule, the substantial benefit rule and the vexatious litigant rule. (The county terms the last the obdurate behavior rule.) (Id. at p. 86.) The court went on to deny the countys fee request under each of those three doctrines. (Id. at pp. 89-93.)

Notably, in denying a fee award under the vexatious litigant/obdurate behavior rule, this court did not actually determine whether it had the power to make such an award; instead, the court assume[d] existence of power to make the award on this ground. (County of Inyo v. City of Los Angeles, supra,78 Cal.App.3d at p. 91.) Nine months later, however, in Bauguess v. Paine (1978) 22 Cal.3d 626, the California Supreme Court concluded trial courts did not have the inherent power to impose sanctions in the form of attorney fees for alleged misconduct. Soon thereafter, the Legislature gave trial courts that power by enacting section 128.5 of the Code of Civil Procedure. (See City of Long Beach v. Bozek (1982) 31 Cal.3d 527, 537.)

From the foregoing (if not from the language of the statute itself), it is apparent Code of Civil Procedure section 1021.5 does not provide any basis for a court to award attorney fees for vexatious litigation or obdurate behavior. Code of Civil Procedure section 1021.5 is a codification of the private attorney general doctrine, which is an entirely distinct basis for recovering attorney fees from the sanctions-based doctrine that now finds expression in various other statutes, such as section 128.5 of the Code of Civil Procedure.

Here, the People did not seek an award of attorney fees under section 128.5 of the Code of Civil Procedure, or any other statute for that matter, based on the conduct of the county defendants in litigating the case; they sought an award only under the private attorney general doctrine codified in Code of Civil Procedure section 1021.5. Accordingly, the trial court erred in not limiting itself to a consideration of the criterion in that statute.

B

The Necessity Criterion

Having concluded the trial court erred in its application of Code of Civil Procedure section 1021.5 to this case, we turn to the arguments of the county defendants that under no circumstances could an award under that statute be appropriate here.

Consistent with the moniker of the doctrine it codified (the private attorney general doctrine), Code of Civil Procedure section 1021.5 originally precluded public entities from receiving fees under the statute. (See, e.g., City of Carmel-by-the-Sea v. Board of Supervisors (1986) 183 Cal.App.3d 229, 254-256.) In 1993, however, the Legislature amended the statute to its present form, which allows a public entity to recover attorney fees from another public entity.^[1] (Stats. 1993, ch. 645, 2, p. 3747.)

Here, the People, acting through the Attorney General, the secretary of the state Resources Agency, and the director of the state Department of Conservation,^[2]recovered fees from the County of Tehama after prevailing in an action to enforce the Subdivision Map Act and the Williamson Act. At first glance, at least, this situation appears to be covered by the 1993 amendment to Code of Civil Procedure section 1021.5. The county defendants argue, however, that the fee award here was not proper because this case is a quintessential public enforcement case to which Code of Civil Procedure section 1021.5 has never applied. According to them, the case law interpreting Code of Civil Procedure section 1021.5 has always recognized a distinction between the private enforcement that is rewarded by the private attorney general doctrine and the public enforcement whose absence justifies the doctrines existence. In their view, where public enforcement is available, fees under Code of Civil Procedure section 1021.5 are not, and since this case constitutes quintessential public enforcement, Code of Civil Procedure section 1021.5 fees are not available here.

The county defendants draw their distinction between private enforcement and public enforcement from case law predating the 1993 amendment to the statute. At the time, fees were available under Code of Civil Procedure section 1021.5 only where the necessity . . . of private enforcement . . . [was] such as to make the award appropriate. In City of Sacramento v. Drew (1989) 207 Cal.App.3d 1287, this court explained that the statutory requirement of necessity . . . of private enforcement addresses the issue of the comparative availability of public enforcement. (Id. at p. 1298.) The court went on to observe that if there is a public attorney general available to enforce the important right at issue there is no utility in inducing a private attorney general to duplicate the function. (Id. at p. 1299.)

Based on the foregoing, the county defendants suggest that recovery of fees under Code of Civil Procedure section 1021.5 is not available when (as here) the Attorney General is available and chooses to act, because such action is by its very nature public enforcement, the availability of which renders private enforcement -- the type of enforcement to which the statute applies -- unnecessary and thus unqualified for a fee award under the statute.

This argument suffers two fatal flaws. First, the necessity criterion in Code of Civil Procedure section 1021.5 has never been interpreted that strictly. Indeed, even where a private party colitigates with a governmental entity on behalf of the public or a large class of persons, whether by way of intervention or . . . by consolidation of separately filed cases, fees under Code of Civil Procedure section 1021.5 may be available if the colitigating private party rendered necessary and significant services of value to the public or to a large class of persons benefited by the result of the litigation. (Committee to Defend Reproductive Rights v. A Free PregnancyCenter (1991) 229 Cal.App.3d 633, 642.) Thus, even before the 1993 amendment, neither the availability nor the actuality of public enforcement -- that is, enforcement by a public entity -- necessarily precluded a fee award under Code of Civil Procedure section 1021.5.

Second, even if we were to assume that the county defendants analysis was valid before the 1993 amendment, it does not withstand scrutiny following that amendment. Under the 1993 amendment, the availability of enforcement by a public entity (i.e., public enforcement) has no bearing on the necessity criterion in an action involving public entities on both sides. In such a case, the court can award fees under the statute if (among other things) the necessity . . . of enforcement by one public entity against another public entity, [is] such as to make the award appropriate. The question in such a case is not whether private enforcement was necessary but whether public enforcement -- that is, enforcement by one public entity against another -- was necessary. Obviously, in such a case the availability of public enforcement cannot preclude a fee award, or no public entity would ever be able to recover fees under Code of Civil Procedure section 1021.5, in derogation of the very terms of the 1993 amendment to the statute.

In summary, we do not agree with the county defendants that the sovereigns deliberate legal action, through its chief law officer, to enforce its own laws can never qualify for a fee award under Code of Civil Procedure section 1021.5 because such action constitutes public enforcement to which the statute does not apply. The distinction between public enforcement and private enforcement the county defendants rely upon has no bearing in an action, like this one, involving public entities on both sides.

C

The Financial Burden Criterion

That does not resolve the matter, however, because the county defendants also rely on the financial burden criterion in the statute as a basis for their argument that an award of attorney fees under Code of Civil Procedure section 1021.5 can never be made to the Attorney General. As noted, Code of Civil Procedure section 1021.5 allows a fee award where (among other things) the necessity and financial burden of private enforcement, or of enforcement by one public entity against another public entity, are such as to make the award appropriate. Traditionally, the financial burden criterion has been deemed satisfied when the cost of the claimants legal victory transcends his personal interest, that is, when the necessity for pursuing the lawsuit placed a burden on the plaintiff out of proportion to his individual stake in the matter. (Woodland Hills Residents Assn., Inc. v. City Council, supra, 23 Cal.3d at p. 941, quoting County of Inyo v. City of Los Angeles, supra, 78 Cal.App.3d at p. 89; see also Serrano v. Priest (1977) 20 Cal.3d 25, 46, fn. 18.)

The county defendants contend that [w]here the successful party is the Attorney General representing the People of the State of California, . . . the general public whose interests must be served to justify an award of fees are the same citizens and residents of the state whose benefits disqualify their sovereign from an award. Thus, in the view of the county defendants, attorney fees are never recoverable under Code of Civil Procedure section 1021.5 in any public enforcement action brought by the Attorney General in his capacity as guardian of the public interest; or, at the very least, such fees were not recoverable in this particular case because the burden of this litigation and the benefit to the public interest do not transcend plaintiffs own interests that are served here.

This argument has merit. Historically, the financial burden criterion of Code of Civil Procedure section 1021.5 has served to limit fee awards under the statute to persons who pursue public interest litigation at a cost to themselves that is out of proportion to any personal interests they might have in the outcome of the matter. The private attorney general doctrine embodied in Code of Civil Procedure section 1021.5 rests on the recognition that in our complex society, citizens in great numbers frequently have interests in common that, while of enormous significance to the society as a whole, do not involve the fortunes of a single individual to the extent necessary to encourage their vindication by private recourse to the courts. Although there are offices and institutions within the executive branch of the government whose function is to represent the general public in such matters and to ensure proper enforcement (e.g., the Attorney Generals office), those offices and institutions are not always able adequately to carry the burden of enforcement, rendering private action socially useful. The issues involved in such litigation are often extremely complex and their presentation time-consuming and costly. The award of substantial attorneys fees to public interest litigants and their attorneys (whether private attorneys acting pro bono publico or members of public interest law firms) who are successful in such cases encourages the representation of deserving interests and worthy causes. (Save El Toro Assn. v. Days (1979) 98 Cal.App.3d 544, 552; accord, Serrano v. Priest, supra, 20 Cal.3d at p. 44.)

Thus, an award of attorney fees under Code of Civil Procedure section 1021.5 has always served as a bounty for pursuing public interest litigation, not a reward for litigants motivated by their own interests who coincidentally serve the public. (California Licensed Foresters Assn. v. State Bd. of Forestry, supra, 30 Cal.App.4th at p. 570.)

With the purpose of the financial burden criterion properly understood, a fundamental anomaly arises in applying that criterion in an action (like this one) brought by the Attorney General on behalf of the People of the State of California. The Attorney General needs no encouragement to pursue litigation that is in the general interest of the states population because, put simply, that is his or her job. As we have noted, under section 12511 (with certain exceptions not applicable here), [t]he Attorney General has charge, as attorney, of all legal matters in which the State is interested. And as the court recognized in Save El Toro Assn. v. Days, supra, 98 Cal.App.3d at page 552, the Attorney Generals office is one of the offices and institutions within the executive branch of the government whose function is to represent the general public in such matters and to ensure proper enforcement. (Accord, Serrano v. Priest, supra, 20 Cal.3d at p. 44.) Rewarding the Attorney General with attorney fees for simply doing his or her job would essentially write the financial burden criterion, as it has historically been understood, out of the statute -- at least where the Attorney General is concerned.

Significantly, the People do not dispute the historical understanding of the financial burden criterion, nor do they claim to be exempt from meeting all the requirements of eligibility for fees under Section 1021.5 to make a successful claim. Instead, they argue the financial burden criterion must be applied differently to public entities than it has historically been applied to private entities. They suggest that where a public entity is concerned, the financial burden criterion should involve an analysis of whether the quantifiable costs of conducting the lawsuit are out of proportion to any pecuniary interest the public entity has in the matter. Under this approach, where the primary--or only--goal of a public entitys suit is the enforcement or protection of a public policy interest, and the pecuniary return from the suit is little or nothing, the burden/benefit analysis should ordinarily come out in favor of eligibility for an award of fees.

The People contend this different approach is required because otherwise the rationale employed by the County and the trial court necessarily and always will preclude a public entity from recovering attorney fees under Section 1021.5, contrary to the express language in the 1993 amendment. We simply cannot agree. There is nothing inherently inconsistent between the financial burden criterion as it has been applied historically and an award of fees to a public entity, at least where that public entity is something less than the state itself.

Two cases will illustrate our point. As we have explained, in County of Inyo v. City of Los Angeles, supra,78 Cal.App.3d at page 82, this court addressed a motion for attorney fees by Inyo County in an action against the City of Los Angeles. (Id. at pp. 84-85.) In denying the county a fee award under the private attorney general doctrine,^[3]this court explained that the statewide benefits the county claimed it had achieved by its litigation were not disproportionately important and valuable in comparison to [the countys] own. (County of Inyo, at p. 90.) The court went on to explain as follows: A county is a political subdivision of the state which provides state and local governmental services for its inhabitants. [Citation.] Inyo County went to court as champion of local environmental values, which it sought to preserve for the benefit of its present and future inhabitants. This action is not a public interest lawsuit in the sense that it is waged for values other than the [countys]. The litigation is self-serving. The victory won by the county in 1977 bulked large enough to warrant the cost of winning it. The necessity for enforcement by Inyo County did not place on it a burden out of proportion to [its] individual stake in the matter. (Ibid.)

In the second case -- City of Hawaiian Gardens v. City of Long Beach (1998) 61 Cal.App.4th 1100 -- Hawaiian Gardens successfully sued to prevent Long Beach from closing a road at the border between the two cities, which would have diverted traffic onto residential streets in Hawaiian Gardens and increased the likelihood of accidents on a street bordering a park and an elementary school. (Id. at pp. 1100, 1106.) On appeal from the trial courts denial of attorney fees under Code of Civil Procedure section 1021.5, the appellate court affirmed, noting: The record establishes that Hawaiian Gardens and its citizens received a substantial benefit when the proposed closure of Pioneer Boulevard was blocked. We agree with the trial court that while the judgment was of regional benefit, there is no showing that the burden of the litigation transcended Hawaiian Gardens interest in the controversy. The case was tried primarily on the administrative record compiled by Long Beach before the resolution was adopted. There was a brief hearing before the trial court. (Id. at p. 1113.)

Although no fee award was made in either of these cases, the cases show that the traditional financial burden criterion in Code of Civil Procedure section 1021.5 can easily be applied to public entities that are political subdivisions of the state -- that is, something less than the state as a whole. In such a case, the pertinent question is whether the public entity deserves a reward for pursuing litigation that was in the interest of a greater spectrum of the public than its own constituents. Although neither Inyo County nor the City of Hawaiian Gardens received a fee award, it was at least conceivable that they could have, if the cost of their litigation had transcended the benefits they secured for themselves, transforming it into true public interest litigation.

Thus, applying the traditional financial burden criterion to public entity litigants will not always preclude a fee award under Code of Civil Procedure section 1021.5, except when the public entity litigant is the state itself, acting through the Attorney General. Such a case will always be self-serving, in that the People will always be pursuing their own interests through their chief attorney, whose very raison dtre is to enforce the laws of the state and serve the public interests of the states population as a whole. As the trial court recognized here, even if the public interest of the state at large has been well-served by this litigation, serving the interests of the state at large is the public responsibility of the Attorney General. To reward the Attorney General with attorney fees for pursuing litigation it is his or her duty to pursue would stand the private attorney general doctrine on its head.

For the foregoing reasons, we conclude the People are not entitled to recover attorney fees in this action under Code of Civil Procedure section 1021.5, and the trial court erred in concluding otherwise.

DISPOSITION

The judgment is affirmed. The Order Re Costs And Attorney Fees is reversed to the extent it awarded attorney fees to the People pursuant to Code of Civil Procedure section 1021.5, but is otherwise affirmed. The parties will bear their own costs on appeal. (Cal. Rules of Court, rule 8.276(a)(4).)

ROBIE , J.

We concur:

DAVIS, Acting P.J.

NICHOLSON , J.

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^* Pursuant to California Rules of Court, rule 8.1110, this opinion is certified for publication with the exception of part I of the Discussion, which includes the appendix.

^[1] It is unclear from the statutory language whether Code of Civil Procedure section 1021.5 actually limits a public entity to recovering attorney fees from a party on the other side of the litigation that is also a public entity. The statute specifies that it applies to allowances . . . in favor of, public entities . . . [if] one or more successful parties and one or more opposing parties are public entities . . . . We need not decide that issue here, however, because the People did not seek fees from KAKE, but only from the county defendants.

^[2] In bringing the action, the Attorney General claimed he was acting within his authority under section 12511, which, with certain exceptions not applicable here, provides that [t]he Attorney General has charge, as attorney, of all legal matters in which the State is interested. According to the complaint, the secretary of the state Resources Agency and the director of the state Department of Conservation were acting pursuant to section 16147, which provides that [t]he Secretary of the Resources Agency may request the Attorney General to bring any action in court necessary to enforce any enforceable restriction as defined in Section 422 of the Revenue and Taxation Code, upon land for which the secretary has certified payment of state funds to the local governing body during the current or any preceding fiscal year. In addition, the Attorney General, the secretary, and the director all claimed to be acting pursuant to section 66499.3, which permits any aggrieved . . . public agency to file a suit in the superior court of the county in which any real property attempted to be subdivided or sold, leased, or financed in violation of [the Subdivision Map Act] . . . is located, to restrain or enjoin any attempted or proposed subdivision or sale, lease, or financing in violation of [the Subdivision Map Act].

^[3] The County of Inyo case, which obviously predated by many years the 1993 amendment to Code of Civil Procedure section 1021.5 that first allowed public entities to seek attorney fees under that statute, was decided under the common law private attorney general doctrine recognized in Serrano v. Priest, supra, 20 Cal.3d at page 25 before Code of Civil Procedure section 1021.5 was enacted.