Claudio v. Johnson

Filed 3/8/07 Claudio v. Johnson CA4/2

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION TWO

APPEAL from the Superior Court of Riverside County. Craig Riemer, Judge. Reversed and remanded with directions.

Holstein, Taylor, Unitt & Law, and Brian C. Unitt for Defendant and Appellant.

Law Offices of Kathleen Moreno, and Kathleen A. Moreno for Plaintiffs and Respondents.

Alicia Claudio, individually (Plaintiff), and as guardian ad litem for minor Elise Claudio (Child), initiated this action against James C. Johnson (Defendant) for breach of contract, breach of third party beneficiary contract, specific performance, and promissory fraud. Defendant brought a special motion to strike the promissory fraud cause of action under the Strategic Lawsuit Against Public Participation (SLAPP) statute. (Code Civ. Proc.,  425.16.^[1]) The trial court denied the motion, and Defendant appeals.

I. PROCEDURAL BACKGROUND AND FACTS

Plaintiff gave birth to Child in September 2000. At the time of conception of Child, Plaintiff was married to Paul Claudio (Mr. Claudio); however, by the time of Childs birth, Plaintiff was separated from Mr. Claudio. The birth certificate named Mr. Claudio as Childs father. In 2001, Plaintiff requested that the Department of Child Support Services (the Department) file a paternity action against Defendant. The Department filed such action on March 15, 2001.

On April 1, 2001, Plaintiff and Defendant entered into an agreement to establish child support. The agreement required Defendant to pay $625 per month to Plaintiff. It further required that both Plaintiff and Defendant maintain strict confidentiality with respect to the issues of paternity and the existence and terms of the agreement. Plaintiff agree[d] not to discuss the Childs paternity with any person in terms other than those currently set forth on Childs birth certificate, including school registration, applications for insurance or credit, and other written statements of information given to health care providers or others. The agreement also provided that [t]he parties represent that they do not intend to file suit or other legal proceedings against each other regarding paternity, child support, or custody. On May 16, 2001, Plaintiff dismissed the paternity action.

On April 29, 2002, a judgment for dissolution of marriage between Plaintiff and Mr. Claudio was entered. Shortly thereafter in mid-2002, Plaintiff contacted Defendants aged mother, who was in ill health, by telephone and informed her of the affair and Child by Defendant, in violation of the agreement.

On a number of occasions in 2002, Plaintiff repeatedly threatened that if Defendant did not accede to her various demands, she would drop [Child] off at [Defendants] office during business hours so that [his] staff could babysit [sic] her, or drop [Child] off at [Defendants] home to meet her brothers and sisters. Plaintiff also threatened to take out an advertisement in the local newspapers and fax pictures and a narrative to [Defendants] business clients and colleagues and friends concerning the paternity issue. Around August 2002, Plaintiff demanded that Defendant purchase a house for her. When Defendant refused to do so, Plaintiff told Defendant in an e-mail dated September 8 that she was planning to take him to court. Nonetheless, Defendant had made all required payments through the end of September 2002, including a payment on September 12, six days after Childs second birthday.^[2]

In fall 2002, Defendant learned that Plaintiff had told others of Defendants paternity of Child. In subsequent conversations in September 2002, Plaintiff confirmed to Defendant that she had indeed engaged legal counsel and was taking [Defendant] to court for more money. Plaintiff later testified in a sworn declaration: The first time that I had ever sought any independent legal representation (other than the district attorney) was when I contacted Mr. Hurst [Plaintiffs family lawyer] sometime during the first part of September, 2002. I formally retained Mr. Hurst on September 18, 2002. When I contacted Mr. Hurst, I stated, according to the belief I then had, that paternity was not an issue and it was simply a child support problem. I felt that the amount of child support I was then receiving ($850.00 per month) was not sufficient. Mr. Hurst agreed to represent me.

On September 13, 2002, attorney George G. Hurst sent a letter to E. Toby Bowler, Defendants attorney, seeking a stipulation to modify child support effective October 1, 2002. In order to assess proper child support payments, Mr. Hurst requested the following documents: (1) defendants most recent financial statement; (2) general background relating to Defendants law practice; (3) any law practice balance sheet of defendant; (4) Defendants law practice profit and loss statements for 1999-2001; (5) any evidence of unearned income; (6) Defendants personal tax returns; (7) check registers and bank statements for Defendants personal and business accounts; (8) dates of birth for Defendants children; (9) any documents reflecting medical insurance; and (10) any documents reflecting life insurance policies and benefits.

Mr. Bowler responded to Mr. Hursts letter on September 19, 2002. Mr. Bowler indicated that he had prepared a petition to establish paternity and sent it to Defendant for approval. Mr. Bowler forwarded Defendants recent tax return and provided the range of ages of Defendants five children. Regarding health insurance, Mr. Bowler indicated Defendants desire to have Plaintiff insure Child separately. Mr. Bowler was in the process of gathering the remaining documents requested. Regarding the amount of support, Mr. Bowler stated: [W]e would like to come to an agreement as to support with as little intrusion as possible into the personal financial affairs of [Defendant.] I believe the tax return offers sufficient information for us to do this within a reasonable comfort zone. Obviously if you insist upon the additional production of bank records, we have no other choice but to comply. However, our desire remains to resolve this matter by stipulated judgment as soon as possible.

After Mr. Bowler sent his letter dated September 19, 2002, he learned that Plaintiff was married to Mr. Claudio at the time of conception and birth of Child. At that point, Mr. Bowler researched and developed a defense based on the conclusive presumption of Family Code section 7541. Defendant never urged or insisted upon such presumption. At the time Defendant was considering making the October 15, 2002, payment under the agreement with Plaintiff, Mr. Bowler advised defendant that he was excused from performance and justified in terminating such agreement, due to Plaintiffs violation of the confidentiality and contact provisions set forth in paragraphs 7 and 8 of the agreement[.] Upon advice of counsel, Defendant refused to make the October 2002 payment or any payment thereafter.

On October 17, 2002, Plaintiff filed her paternity action as case No. SWD000375 in Riverside County Family Court. A contested hearing was held on January 9, 2004. The court found that Mr. Claudio was the legal father of Child because he held [Child] out in public places, in public settings to third parties, as being his child and had developed a parental relationship with her. Conversely, the court found that there was no parent-child relationship between Defendant and Child. The court invoked its discretionary right to deny the genetic evidence because no notice of motion for genetic testing was brought within the two (2) year period specified by [Family Code], [s]ection 7541(b).

After losing in the paternity action, Plaintiff initiated this action on March 14, 2005. At or around the same time, she filed an application for appointment as guardian ad litem of Child. The court granted such application on May 27. Plaintiff and Child then filed their first amended complaint on June 21, asserting causes of action for breach of contract, breach of contract by third-party beneficiary contract, specific performance, and promissory fraud. Plaintiff and Child claimed that Defendant breached the agreement for support of Child by repudiating his obligations and refusing to pay to Plaintiff sums due as child support under the agreement. Plaintiff and Child further claimed that Defendant had no intent to keep his promise to provide support for Child pursuant to the agreement, as evidenced by his failure and refusal to make the support payments after Child reached the age of two years.

On September 9, 2005, Defendant filed an anti-SLAPP motion as to the fourth cause of action for promissory fraud pursuant to section 425.16. At the hearing on October 21, the trial courts tentative ruling was to grant the motion; however, during the course of the hearing, the court decided to deny it. According to the record, the trial court was influenced by two things, namely, (1) the claim that Plaintiff had talked to Defendants mother in February 2002 (breaching the agreement) but Defendant did not claim breach and cease performance; and (2) the fact that Defendants last payment occurred at the time of Childs second birthday. The matter of Plaintiff and Childs attorney fees was taken under submission. On October 24, 2005, the court entered its order that awarded attorney fees to Plaintiff and Child in the amount of $1,800. Defendant appeals.

II. STANDARD OF REVIEW

An order denying an anti-SLAPP special motion to strike is appealable under sections 425.16, subdivision (i), and 904.1. We review the order de novo. [Citation.] (Chambers v. Miller (2006) 140 Cal.App.4th 821, 824.)

III. MOTION TO STRIKE

Under section 425.16, subdivision (b)(1), [a] cause of action against a person arising from any act of that person in furtherance of the persons right of petition or free speech under the United States or California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim. ( 425.16, subd. (b)(1).) Subdivision (e) of section 425.16 describes an act in furtherance of the right of free speech as including any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body[.]

To prevail on an anti-SLAPP motion, the movant must first make a threshold showing that the challenged cause of action arises from an act in furtherance of the right of petition or free speech . . . . [Citation.] Once the movant meets this burden, the plaintiff must demonstrate a probability of prevailing on the claim. [Citation.] The court must strike the cause of action if the plaintiff fails to meet this burden. [Citation.] Subdivision (c) of section 425.16 provides: [A] prevailing defendant on a special motion to strike shall be entitled to recover his or her attorneys fees and costs. If the court finds that a special motion to strike is frivolous or is solely intended to cause unnecessary delay, the court shall award costs and reasonable attorneys fees to a plaintiff prevailing on the motion, pursuant to Section 128.5. (Chambers v. Miller, supra, 140 Cal.App.4th at pp. 824-825.)

Turning to the case before this court, we note that Plaintiff and Child agree, this case fits under the purview of the Anti-SLAPP statute. Thus, we turn to the second step and determine whether Plaintiff and Child showed a probability of prevailing.

Promissory fraud is a subspecies of the action for fraud and deceit. A promise to do something necessarily implies the intention to perform; hence, where a promise is made without such intention, there is an implied misrepresentation of fact that may be actionable fraud. [Citation.] An action for promissory fraud may lie where a defendant fraudulently induces the plaintiff to enter into a contract. [Citations.] . . . . [Citation.] (Agosta v. Astor (2004) 120 Cal.App.4th 596, 603.) That is the gist of the allegations here, that, but for certain representations made by Defendant, Plaintiff would not have dismissed the Departments paternity action and refrained from initiating further legal proceedings against Defendant to establish Defendants paternity of Child. The elements of fraud, which give rise to the tort action for deceit, are (a) misrepresentation (false representation, concealment, or nondisclosure); (b) knowledge of falsity (or scienter); (c) intent to defraud, i.e., to induce reliance; (d) justifiable reliance; and (e) resulting damage. [Citations.] (Lazar v. Superior Court (1996) 12 Cal.4th 631, 638.) In order to establish the probability of prevailing on their promissory fraud claim, Plaintiff and Child must produce admissible evidence sufficient to establish a prima facie case that Defendant did not intend to perform the promise when it was made. (Tuchscher Development Enterprises, Inc. v. San Diego Unified Port Dist. (2003) 106 Cal.App.4th 1219, 1235.)

Based on the record before this court, we cannot say that the evidence was sufficient to establish a prima facie case of promissory fraud. According to Plaintiff, Defendant knew that Plaintiffs divorce agreement did not provide for support of Child. However, while Defendant entered into the support agreement with Plaintiff on April 1, 2001, the marital settlement agreement that set child support was not entered into until February 27, 2002, and the judgment of dissolution was not filed until April 29, 2002. Thus, at the time of entering into the agreement with Plaintiff, Defendant could not know whether the issue of Childs paternity would be raised in Plaintiffs divorce from Mr. Claudio, or how that issue would be resolved.

Defendants actions never suggested an intent to cease paying support for Child even after Plaintiff contacted Defendants mother, threatened to disclose the paternity of Child, demanded more money, and hired an attorney for the purpose of increasing the monthly child support. Instead, only upon the advice of counsel did Defendant terminate the agreement and cease making payments. Plaintiffs actions justified Defendants termination of the agreement.

Regarding Plaintiff contacting Defendants mother, Beverly Johnson, Ms. Johnson stated that she learned about the affair and [Child] for the first time in mid-2002 from [Plaintiff] when she called [Ms. Johnson] on [her] home telephone. [Ms. Johnson] was very surprised and shocked to learn such information and [she] immediately wept and felt deep concern for [her] son, [her] daughter-in-law, and their children[.] In September 2005, Plaintiff submitted a declaration stating that Flo Britt was the person who advised Ms. Johnson of the affair and Child. However, both Ms. Johnson and Ms. Britt denied such claim. More importantly, contrary to her September 2005 declaration, Plaintiff acknowledged in an earlier declaration dated December 30, 2002, the fact that she had contacted Ms. Johnson.

Despite Plaintiffs action of contacting Defendants mother in mid-2002, Defendant continued to honor his obligations under the agreement. Nonetheless, Plaintiff became unhappy with the monthly amount of $850 and decided to contact an attorney, Mr. Hurst, during the first part of September 2002. She retained him, and he spoke with Defendants attorney, Mr. Bowler, on September 11. On September 12, Defendant paid the support to Plaintiff. On September 13, Mr. Hurst sent a letter to Mr. Bowler confirming Plaintiffs intent to seek an increase in child support and requesting certain documents.

According to Mr. Bowler, Between September 13, 2002, and the last week of that month, I was unaware of any viable defense to a petition to establish paternity and to set guideline child support, because I did not know that (a) [Child] was conceived during the time of [Plaintiffs] cohabitation with [Mr. Claudio], (b) Mr. Claudio had already established a significant parent-child relationship with [Child], and (c) a substantial sibling identity and family unity existed among [Child], her two brothers, and [Mr.] Claudio. Accordingly, it appeared at that time that it might be better for defendant to file the petition himself in order to have some procedural control over the proceedings. At that time, Defendant did not mention, much less express any desire to invoke, the conclusive presumption of [Family Code section] 7541; to the contrary, he was prepared to file his own petition based on [P]laintiffs clear repudiation of the agreement and determination to proceed in establishing paternity and child support through the court. Thus, six days later, on September 19, Defendants attorney sent some of the documents requested by Mr. Hurst, including the proposed petition for paternity and child support, and indicated a mutual intent to resolve the issues as soon as possible.

Shortly thereafter, Mr. Bowler learned of Plaintiffs marriage to Mr. Claudio at the time of conception and birth of Child. At that point, Mr. Bowler developed a defense based on the conclusive presumption of Family Code section 7541. Given this defense and Plaintiffs actions, Mr. Bowler advised Defendant that he was justified in terminating the agreement with Plaintiff and that Defendant was excused from further payments. Defendant stated that it was Plaintiffs acts of violating the confidentiality part of the agreement and engaging counsel to file a paternity action that caused him to cease his payment obligations.

Given the above, the evidence fails to support any finding that Defendant intended to defraud Plaintiff at the time they entered into the agreement. (Kyle v. Carmon (1999) 71 Cal.App.4th 901, 907-908.) Because Plaintiff and Child have failed to make a prima facie showing that Defendant misrepresented his intent to be bound by the agreement or intended to defraud her, there is no probability that Plaintiff and Child will succeed on their promissory fraud cause of action. Accordingly, the trial court erred in denying Defendants special motion to strike the fourth cause of action for promissory fraud.

IV. AWARD OF ATTORNEY FEES AND COSTS

In awarding attorney fees to Plaintiff and Child, the trial court observed: The party who prevails on a special motion to strike is entitled to recover reasonable attorneys fees. (Code Civ. Proc., 425.16, subd. (c).) Defendant contends the trial court erred in applying an incorrect standard in awarding attorney fees to Plaintiff and Child. We agree.

Section 425.16, subdivision (c) does not merely award attorney fees to the prevailing party. Instead, the statute reflects a clear preference for awarding fees and costs to prevailing defendants. Section 425.16, subdivision (c) provides that a prevailing defendant on a SLAPP motion to strike shall be entitled to recover his or her attorneys fees and costs. A prevailing plaintiff, however, can only recover fees and costs [i]f the court finds that a special motion to strike is frivolous or is solely intended to cause unnecessary delay . . . . (ComputerXpress, Inc. v. Jackson (2001) 93 Cal.App.4th 993, 1018.) Because we have found that Defendants motion should have been granted, we likewise find that Defendant is entitled to recover attorney fees and costs incurred in moving to strike the claim for promissory fraud. Thus, the award of attorney fees to Plaintiff and Child is reversed and the matter is remanded. The trial court may determine the appropriate amount of fees and costs upon a proper application by Defendant. (ComputerXpress, Inc. v. Jackson, supra, 93 Cal.App.4th at p. 1020.)

V. DISPOSITION

The order denying the motion to strike and awarding attorney fees is reversed. The trial court is directed to enter a new order granting Defendants anti-SLAPP motion as to the promissory fraud claim. Upon an appropriate motion and factual showing, Defendant may recover attorney fees and costs in connection with his anti-SLAPP motion and on appeal, under section 425.16, subdivision (c), in an amount to be determined by the trial court.

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

HOLLENHORST

Acting P. J.

We concur:

KING

J.

MILLER

J.

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^[1]All further statutory references are to the Code of Civil Procedure.

^[2]Such payment covered the period of September 15 through October 15, 2002.