Rofeh v. Canon Partnership

Filed 8/28/07 Rofeh v. Canon Partnership CA2/5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FIVE

APPEAL from a judgment of the Superior Court of Los Angeles County.

Patricia L. Collins, Judge. Affirmed.

Isaacman, Kaufman & Painter and Robert W. Woods for Plaintiff and Appellant.

Law Offices of Linda M. Libertucci and Sarah Yoseloff for Defendants and Respondents.

_______________

Plaintiff Manoucher, or Mark, Rofeh appeals the trial court order granting the motion of defendant Canon Partnership to strike plaintiff's malicious prosecution complaint pursuant to Code of Civil Procedure section 425.16, the anti-SLAPP statute, as well as the denial of a subsequent motion for reconsideration. Finding no error, we affirm.

FACTS AND PROCEDURAL SUMMARY[1]

The parties have a long, contentious history. Rofeh leased from Canon Partnership ("Canon") office space (the "Office Property") located at 224C North Canon Drive in Beverly Hills pursuant to a written lease dated December 22, 1992 (the "Office Lease"), and a second, adjacent property (224 North Canon Drive) on which Rofeh operated a jewelry store (the "Store Property") pursuant to a separate written lease dated May 10, 1993 (the "Store Lease"). Each lease had an initial term of five years, extendable by the exercise of one or more options to a total term of 15 years.

Canon instituted five separate proceedings against Rofeh between 2001 and 2005. The first two, filed on January 18, 2001 and later consolidated, were for unlawful detainer, and resulted in judgment for Rofeh. Rofeh sought an award of attorney fees as the prevailing party in those cases. The motion was taken under submission. The proposed order submitted by Rofeh's attorney, Marvin Mitchelson, was signed by the Judge, and a conformed copy was sent to Mr. Mitchelson. Rofeh then sought and obtained a writ of execution, and levied on Canon's bank account.

Canon filed lawsuit number three, again for unlawful detainer, on November 7, 2001. Canon prevailed, and obtained possession of the Store Property on June 18, 2002.

On January 17, 2003, Canon filed a fourth lawsuit against Rofeh (one of the two underlying lawsuits in this malicious prosecution action). The complaint alleged four causes of action: (1) for recovery of unpaid rent under the Office Lease; (2) for recovery of unpaid rent and leasehold charges which accrued under the Store Lease during the period after Rofeh surrendered possession and before Canon relet those premises; (3) for wrongful execution by Rofeh on Canon's bank account; and (4) for conversion of money from Canon's bank account.

On October 16, 2003, while the fourth lawsuit was pending, Canon learned that, due to a clerical error, Rofeh had an honest but mistaken belief that his attorney fees motion had been granted, and thus, as of that time, Canon knew that its causes of action for wrongful execution and conversion were without probable cause. It did not, however, dismiss those causes of action, but simply announced at trial that it would not be presenting any evidence in connection with the wrongful execution action; it made no comment, and presented no evidence, with regard to the conversion claim. The trial court declared the conversion claim "abandoned," and found in favor of Rofeh on the first cause of action for unpaid rent as well as the third cause of action for wrongful execution. The court awarded Canon $11,289 in unpaid rent under the Store Lease.

Canon's fifth lawsuit against Rofeh (also the basis of this malicious prosecution suit) was an unlawful detainer action filed April 21, 2005, seeking possession of the Office Property based on a thirty-day notice of termination of a month-to-month tenancy (on the theory that the Office Lease had expired at the end of the first five-year option period). Rofeh responded by filing a quiet title action on June 2, 2005. On June 13, 2005, Canon dismissed its unlawful detainer action.

On February 6, 2006, Rofeh filed a complaint for malicious prosecution against Canon based on Canon's fourth (January 2003) and fifth (April 2005) lawsuits against him. Canon filed an anti-SLAPP motion, which the trial court granted. The court ruled that Rofeh had not met his burden of establishing that the underlying lawsuits were initiated and prosecuted without probable cause and terminated in his favor, and so granted the motion. Rofeh appeals.

DISCUSSION

The parties impliedly agree that, because access to the courts is protected activity, a malicious prosecution action is subject to an anti-SLAPP motion, and indeed, necessarily meets the first prong of the two-prong test for such motions. (Jarrow Formulas, Inc. v. LaMarche (2003) 31 Cal.4th 728, 734.) Canon argued below, and the trial court agreed, that Rofeh did not establish a probability of prevailing on the merits, as he did not, and could not, establish two elements of such a cause of action: lack of probable cause to bring the underlying suits, and termination of the prior actions in his favor. Rofeh maintains that the trial court erred in so ruling.

1. Probable cause to prosecute the 2003 lawsuit

a. First cause of action (for rent due on Office Property)

Rofeh argues, "It is obvious that Canon never had probable cause to sue for alleged unpaid rent on unit 244C [the Office Property], since it knew that there was no evidentiary support for a claim that the rental had been increased from $300 per month to $646.26 per month, and its whole claim was based on that higher rental rate." However, Canon did offer evidentiary support for its claim, including the Office Lease, which provided that the rental payment would change to the market rate upon termination of the initial term and any subsequent terms of the lease, as well as Canon's rent ledgers showing that the amount of rent for the Office Property was $646.26 month and the testimony of Maria Delrosario, Canon's bookkeeper. Thus, contrary to Rofeh's contention, Canon did not lose on its first cause of action because "there was no evidentiary support" for it, but because the trial court concluded that Canon had not met its burden of proof. Had the trial court ruled that the rent due on the Office Lease was $646.26 per month as of May of 1998, that ruling, too, would have been supported by substantial evidence. In short, the fact that the court ruled in Rofeh's favor on this issue does not establish a lack of probable cause for Canon to bring it.

b. Third and fourth causes of action (for wrongful execution and conversion)

Rofeh maintains that Canon lacked probable cause to bring the wrongful execution cause of action, because "Canon has admitted that the only action it took to determine whether it had a viable cause of action for Rofeh's alleged wrongful execution on Canon's bank account (the third cause of action) was one 'informal' letter Mr. Rubin wrote to Marvin Mitchelson, Rofeh's attorney, about the issue."

In that "one 'informal' letter," Canon's attorney, Mr. Rubin, stated: "My client has received notification that you have levied a writ against [its] bank account in the sum of $13,959.00. Demand is hereby made that you release this garnishment at once." Mr. Rubin went on to explain that the trial court had granted his motion to tax Rofeh's claim for attorney fees; that the judge signed the order awarding fees, but wrote the word "denied" over her signature; and that the writ clerk informed Mr. Rubin that the order denying the fee request was not in the file at the time the writ was issued, and that the writ would not have been issued had the order been properly filed. Mr. Rubin wrote: "Perhaps you were not in possession of the above facts when you requested the writ; you are now. If any money is taken from my client's bank account, we will deem it to be an intentional and actionable wrongful execution by both you and your client."

Rofeh acknowledges that Mr. Mitchelson never responded to the foregoing letter, and that Mr. Rubin did not learn the facts upon which Rofeh relied in obtaining the writ of execution until October 2003. Consequently, Canon had probable cause to file the wrongful execution and conversion causes of action in January 2003.

Relying on Zamos v. Stroud (2004) 32 Cal.4th 958, Rofeh contends that, even if there was probable cause to commence the lawsuit based on the third and fourth causes of action, Canon's failure to dismiss the claims for wrongful execution and conversion once he learned that the trial court had (erroneously) issued an attorney fee award against Canon in the first lawsuit, upon which Rofeh sought and obtained a writ of execution, constitutes lack of probable cause to continue prosecution of the action.

In Zamos v. Stroud, supra, the Supreme Court ruled that "an attorney may be held liable for malicious prosecution when he commences a lawsuit properly but then continues to prosecute it after learning it is not supported by probable cause." (32 Cal.4th at p. 960.) In the underlying lawsuit, Zamos was sued by his former client, Patricia Brookes, for fraud in connection with the settlement of a foreclosure lawsuit. Brookes made specific allegations of representations Zamos made to her in the foreclosure lawsuit. Zamos provided Brookes's lawyer with reporter's transcripts of three hearings which Zamos contended proved that Brookes's fraud claims were meritless. Stroud and Brookes refused to dismiss the fraud lawsuit in light of this evidence, and opposed Zamos's motion for summary judgment, which the trial court "reluctantly" denied. When the case went to trial, the judge (who had not presided over the earlier proceedings) granted Zamos's motion for a nonsuit. On those facts, the Supreme Court affirmed the judgment of the Court of Appeal, which held that "an attorney may be liable for malicious prosecution if the attorney continues to prosecute a lawsuit after discovery of facts showing the lawsuit has no merit." (Id. at p. 964.)

Zamos v. Stroud differs from the instant case in two relevant particulars: There, the malicious prosecution plaintiff sued the lawyer, rather than the client, for continuing to prosecute the case once the lawyer discovered it was without merit. Like the lawyer in Zamos v. Stroud, the evidence which established that the lawsuit was meritless (there, the transcripts of the hearings and here the order awarding Rofeh attorney fees) was presented to the attorney, not to the client. Weighing the effect of such evidence on the continued prosecution of a lawsuit is a matter peculiarly within the knowledge and competence of the attorney, not the client. Consequently, the fact that the Supreme Court in Zamos v. Stroud permitted a malicious prosecution lawsuit to proceed against an attorney who learns of evidence suggesting the suit lacks probable cause is not dispositive in this case, where Rofeh is suing the client rather than the attorney.

Moreover, we must look at the conduct of the defendant after learning that Rofeh's writ of execution was not improperly obtained. In Zamos v. Stroud, after obtaining evidence that the lawsuit lacked probable cause, counsel refused to dismiss the action, opposed a motion for summary judgment, and presented evidence at trial which established that the plaintiff did not have probable cause to continue prosecuting the lawsuit. In contrast, here, Canon provided evidence that its attorney, Mr. Rubin, upon learning in October 2003 that Rofeh's counsel, Mr. Mitchelson, had probable cause to seek the writ of execution (based on a conformed copy of an order awarding attorney fees), agreed that Canon would not pursue the wrongful execution and conversion causes of action. Two months later, in a "Plaintiff's Mediation Statement" dated December 22, 2003, plaintiff characterized the action as one "for collection of unpaid rent and leasehold charges" due under the Office Lease and Store Lease. The statement continued: "The cause of action for wrongful execution is no longer being prosecuted, having been previously resolved by the parties." At the commencement of trial, in March 2004, Mr. Rubin told the trial judge that Canon would not be pursuing the wrongful execution claim. We cannot conclude from this record that Canon "continu[ed] to prosecute a lawsuit discovered to lack probable cause" within the meaning of Zamos v. Stroud.

Because Rofeh cannot establish the lack of probable cause element of his malicious prosecution action based on the 2003 lawsuit, we need not and do not consider the issue of whether he obtained a favorable termination in that matter.

2. Probable cause to prosecute the 2005 lawsuit

The 2005 lawsuit was an unlawful detainer action filed after Rofeh failed to vacate the Office Property following Canon's 30-day notice of termination. Rofeh argues that Canon lacked probable cause to bring the suit, based on the following reasoning: Canon's 30-day notice of termination assumed that Rofeh was a month-to-month tenant, but Judge Lefkowitz had already decided in the first round of unlawful detainer actions with respect to the two properties that Rofeh had validly exercised his options to remain in the Office Property for the full 15 years. Specifically, Rofeh relies on the following ruling of Judge Lefkowitz: "The court finds that Defendant exercised his options for the involved properties." From this ruling Rofeh argues: "The fact that Judge Lefkowitz used the plural form when referring to Rofeh's 'options' and both 'properties' (i.e., units 224C and 224) shows that Judge Lefkowitz had found that Rofeh had extended his leases on both units for their maximum length of fifteen years each. This is the only logical reading of her ruling." On pages 34 through 36 of his opening brief, Rofeh explains why this is the only logical reading of Judge Lefkowitz's ruling. Suffice it to say that we do not agree that this is the only logical reading of Judge Lefkowitz's ruling.

Judge Lefkowitz was concerned with the status of the two leases as of January 2001. The initial term of each lease was five years. It was Canon's position in the unlawful detainer actions that, prior to the expiration of each lease, Rofeh had not exercised his option to extend that lease in accordance with the lease terms. Judge Lefkowitz ruled that Rofeh timely notified the lessor of his intention to extend the leases: "The court finds that Defendant exercised his options for the involved properties." However, the Office Lease contained two options to extend the lease, each for an additional five-year period. Thus, the only question before Judge Lefkowitz, and the only answer encompassed within her ruling, is whether Rofeh exercised the first option to extend the Office Lease term for an additional five years. Consequently we reject Rofeh's contention that Judge Lefkowitz's ruling "judicially established that Rofeh had extended the term of this lease on unit 224C for the full fifteen years, i.e., from the date of the lease, January 1, 1993, through December 31, 2008."[2]

Again, as Rofeh cannot establish that Canon lacked probable cause to file the 2005 unlawful detainer action, we need not and do not consider the issue of whether he obtained a favorable termination in that matter.

3. Motion for reconsideration

Lastly, Rofeh asserts that he submitted additional evidence[3] on his motion for reconsideration which established, by Canon's admission, that Rofeh had exercised his options on the Office Property for the full 15 years. The trial court denied Rofeh's motion for reconsideration.

Rofeh has presented this court with no basis to overturn that order. In truth, Rofeh presented no new facts, circumstances or law in support of his motion for reconsideration as required by Code of Civil Procedure section 1008, but merely sought a "do-over." The trial court did not err in refusing this request.

DISPOSITION

The judgment is affirmed.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

ARMSTRONG, J.

We concur:

TURNER, P. J.

KRIEGLER, J.

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[1] Respondent's motion, filed January 3, 2007, to strike pages 854 through 1187 of the Joint Appendix is granted. The cited material, consisting of a reporter's transcript of a prior proceeding between the parties, was not part of the record below and thus ought not to have been included in the Joint Appendix on appeal.

[2] By our calculations, a 15-year lease which commenced on January 1, 1993, would terminate on December 31, 2007.

[3] This evidence consisted of the declaration of another one of Canon's tenants, who stated that Canon had told him that Rofeh holds a "'long lease,' of some ten years" on the Office Property.