Baltayan v. Estate of Getemyan , 90 Cal. App. 4th 1427 ( 2001 )

Opinion

BOLAND, J.^*

Introduction

Appellant Gagik Baltayan’s personal injury action was dismissed after he failed to comply with the trial court’s order requiring him to post an undertaking pursuant to Code of Civil Procedure section 1030. Appellant argues that the undertaking should not have been required because respondent did not make a sufficient showing that it had a reasonable possibility of obtaining a defense verdict. He also argues that the trial court abused its discretion and violated appellant’s equal protection and substantive due process rights by failing to waive the undertaking after appellant showed that he was indigent.

We hold that the evidence presented by the parties at arbitration and an arbitration award in favor of respondent established a reasonable possibility that respondent would prevail at trial. Because appellant’s showing of indigency was weak, incomplete, and inconsistent with some of his admitted spending, the trial court did not abuse its discretion in denying appellant’s motion for relief from the security order. Nonetheless, after appellant effectively proved his indigency and was granted in forma pauperis status, the trial court abused its discretion in dismissing the case due to appellant’s failure to post the undertaking.

Background and Procedural History

Respondent Maro Getemyan, while driving a car owned by Hagop Etmekjian, struck the car of appellant Baltayan. Appellant filed a complaint alleging that Etmekjian negligently entrusted the car to Getemyan, whose negligent driving caused the accident. Getemyan died from causes unrelated to the accident. In accordance with the provisions of Probate Code section 552, her estate was substituted as a defendant.

After the case was ordered to judicial arbitration and an arbitration date had been scheduled, appellant requested leave to amend his complaint to add a product liability claim against General Motors. Appellant ultimately withdrew the motion, and respondents filed a motion under Code of Civil Procedure section 1030 to require appellant, a resident of the State of Washington, to post a bond. Code of Civil Procedure section 1030 provides that upon a defendant’s motion, the trial court is required to order an out-of-state plaintiff to file an undertaking to secure recoverable costs and attorney’s fees if the defendant shows a reasonable possibility that it will obtain judgment in the action.

Respondents based their motion for a bond on statements contained in the police report and attributed to Getemyan, Baltayan, and Baltayan’s passenger, Arsen Ouloubian. In that report, Los Angeles Police Department Officer Steven Fisher quoted appellant as telling him “I was driving east on Hollywood Boulevard. I was with my friend. I pulled over to the curb, but I saw a no parking sign. I put on my blinker and pulled out and suddenly I was hit.” Fisher wrote that Ouloubian’s statement was “substantially the same as” appellant’s, and that Getemyan told Fisher that she was driving east on Hollywood Boulevard when she saw appellant’s car moving slowly along the curb. As “she started to pass,” appellant’s car pulled out.

Appellant subsequently wrote his own supplement to the police report in which he stated that he was driving in the rightmost lane and planned to turn right at the next intersection. While he was stopped waiting for a truck that pulled out from a driveway in front of him, he saw Getemyan approaching quickly from behind. She disappeared from view, then hit his car from behind. After the accident, appellant approached Getemyan, who said, “I nearly killed you.”

The court continued the bond motion until after arbitration.

At the arbitration, appellant testified and the parties submitted various documents for consideration. The next day, the arbitrator issued his ruling awarding appellant nothing and awarding respondents costs. In a letter accompanying the award, the arbitrator stated that:

“Based upon statements made to the investigating police officer on the date of the accident by the plaintiff, the decedent defendant and plaintiff’s passenger, it appears that the accident was caused by plaintiff’s unsafe turning maneuver into the path of the decedent’s vehicle.

“I disregarded the plaintiff’s arbitration testimony as self-serving and lacking in credibility. The evidence suggested that the plaintiff had a reasonably good command of the English language at the time he was interviewed by the police officer and that he changed his version of the accident only after he had seen an attorney. Finally, I found plaintiff’s argument that photographs of his vehicle supported his version to be unpersuasive.”

Appellant filed a timely request for a trial de novo. Respondents renewed their motion to require appellant to post a bond and cited the arbitration award as additional evidence that it was reasonably possible that respondents would prevail. Appellant did not oppose the motion on its merits, but simply argued that the court had agreed to hear it at the trial setting and status conference scheduled about three weeks after the noticed hearing date. Neither appellant nor his attorney appeared at the hearing on the motion, which the trial court granted. The court gave appellant ten days to post an undertaking in the amount of $22,000.

Before the 10 days expired, appellant filed a motion for relief from the order on the grounds that he was indigent, requiring him to post the security would violate his right to equal protection, respondent had not shown a reasonable possibility that it would obtain a judgment at trial, and the court has abused its discretion in giving appellant only 10 days to post the bond. The court gave appellant an additional 15 days to post the security, but otherwise denied his motion. About three months later, appellant obtained an order waiving court fees and costs.

Appellant did not post the undertaking, and respondents moved to dismiss the action. Appellant opposed on the ground that he was now in forma pauperis, and the court should waive the undertaking. The court granted the motion to dismiss, and this appeal followed.

Discussion

1. Respondents demonstrated a reasonable possibility that they would obtain a judgment in their favor.

Appellant contends that respondents did not meet their burden of showing a reasonable possibility that they would obtain a defense verdict, as opposed to simply reducing appellant’s recovery through comparative fault. He argues that he was rear-ended by Getemyan, and the statement attributed to him in the police report should be disregarded because his English language skills were poor.

Respondents were not required to show that there was no possibility that appellant could win at trial, but only that it was reasonably possible that respondents would win. (Code Civ. Proc., § 1030, subd. (b).) They satisfied this burden by directing the court to the arbitration award, the arbitrator’s letter, and the police report. (Shannon v. Sims Service Center, Inc. (1985) 164 Cal.App.3d 907, 914 [210 Cal.Rptr. 861] [reasonable possibility shown by arbitration decision in favor of defendant].) At the arbitration hearing, appellant testified and presented the same arguments and documentary evidence urged in support of his motion for relief from the order requiring an undertaking. The arbitrator nonetheless found appellant’s initial statement to police to be more credible and consistent with Getemyan’s and Ouloubian’s statements to police. Officer Fisher testified in his deposition that he was able to speak to appellant without an interpreter, they had a conversation about Spokane, and appellant’s answers to Fisher’s questions were responsive and led him to believe that appellant understood him. Appellant provided corroboration of Fisher’s assessment of his language skills by attaching to his arbitration brief a hospital report that stated that appellant “speaks reasonable English.”

Moreover, the reports by the parties’ respective accident reconstruction experts were largely consistent with one another, and neither report concluded that the physical evidence contradicted the description of the accident given by the parties to Officer Fisher. Appellant’s expert stated that the damage to the cars showed that it was an offset collision with the cars driving at different angles at the time of the collision. In his opinion, the damage to the cars indicated that Getemyan’s car was going 25.9 to 37.5 miles per hour at the time of impact. Appellant’s expert believed the damage, as well as the locations where the cars came to rest, was more consistent with “a pre-impact swerve” by Getemyan. Respondents’ expert agreed that it was an offset collision and that the angle of impact could not be determined. However, given the size of appellant’s car and the point of impact identified by Officer Fisher, respondents’ expert believed that appellant’s car was not adjacent to the curb, but had pulled away from the curb by 4.3 feet. The extent of the damage to each car indicated a “relative impact speed” of 20 to 24 miles per hour. Respondent’s expert opined that the physical evidence supported the parties’ statements in the police report.

Appellant argued that the arbitrator could not have evaluated the “voluminous” evidence submitted because he issued his decision the very next day. However, having read the parties’ arbitration briefs and the documents attached thereto, this court found that the review consumed little time. Many of appellants’ documents pertained to damages, and were thus irrelevant to determining liability. In addition, the copy of appellant’s brief included in Appellant’s appendix contains two copies of lengthy medical records, including numerous pages of heart monitor graphics. The arbitrator could easily have reviewed the parties’ documents in the evening hours following the hearing or the next day before issuing the award.

Appellant’s claim herein essentially challenges the sufficiency of the evidence. This court’s task is simply to determine whether any substantial evidence supports the trial court’s determination. (Shannon v. Sims Service Center, Inc., supra, 164 Cal.App.3d at p. 911.) Given the fact of the arbitration award, as well as the evidence submitted in support of each side’s position, the trial court properly found that there was a reasonable possibility that respondents would win at trial.

2. The trial court abused its discretion in dismissing the case after appellant was granted in forma pauperis status.

Appellant contends that his showing of indigence required the trial court to waive the bond requirement.

Where the plaintiff establishes indigency, a trial court has discretion to waive the posting of security under Code of Civil Procedure section 1030. (Bank of America v. Superior Court (1967) 255 Cal.App.2d 575, 578 [63 Cal.Rptr. 366].) However, the plaintiff should make a prima facie showing that he has unsuccessfully attempted to obtain the required undertaking or that he is unable to furnish it. (Fuller v. State of California (1969) 1 Cal.App.3d 664, 668 [82 Cal.Rptr. 78].)

Appellant accompanied his motion for relief with his declaration stating that he had no savings and neither he nor his wife owned real property. His declaration also said that his family’s income for 1999 was the same as that reflected on the attached copies of their 1997 and 1998 federal income tax returns. The attached tax return copies were incomplete because they indicated business income requiring completion of schedule C, but did not include a copy of that schedule. The returns reflected adjusted gross income of $15,150 in 1997 and $14,248 in 1998.

Based on appellant’s declaration and tax returns, the trial court could have exercised its discretion by waiving the security requirement or reducing the amount of the undertaking. This does not mean, however, that the trial court abused its discretion by declining to do so. An exercise of discretion will be disturbed on appeal only if the court exercised it in an arbitrary, capricious, or patently absurd manner resulting in a manifest miscarriage of justice. (People v. Rodrigues (1994) 8 Cal.4th 1060, 1124 [36 Cal.Rptr.2d 235, 885 P.2d 1].)

Here, it cannot be said that the trial court’s decision was arbitrary, capricious or patently absurd. Appellant relied primarily upon the copies of his tax returns to show low income, but apparently deliberately omitted from each return schedule C. The schedule would have revealed the actual business gross receipts of the business and the amount claimed as deductible business expenses. In addition, appellant’s declaration did not address whether his wife had any savings, nor did it deny ownership of assets other than real property, e.g., jewelry, artwork, equipment or cars that might be used as collateral to secure the bond. Appellant likewise did not address whether he or his wife had a friend or relative who would be willing to either post a cash bond or pay the premium on a surety bond. (Fuller v. State of California, supra, 1 Cal.App.3d at p. 667.) Nor did appellant or his attorney show that they had made any unsuccessful effort to obtain an undertaking. Counsel’s declaration merely stated that he had “inquired of several bond companies as to the procedure for obtaining” the required undertaking, but did not show any actual attempt to obtain it.

Moreover, appellant’s arbitration brief, which he attached to his motion for relief, showed a spending level that reasonably cast doubt upon appellant’s indigency claim. He claimed as damages attributable to the accident $1,260 for a motel in Hollywood and $1,818 for a rental car in Los Angeles. Thus, appellant apparently had sufficient resources to maintain a temporary residence in Los Angeles, instead of returning home to Spokane. Respondents also claimed in their opposition to the motion for relief that appellant had paid for round-trip airfare to Moscow. While respondents did not authenticate purported copies of an aircraft boarding pass and train tickets attached to their opposition, appellant waived this defect by failing to object. (Evid. Code, § 353, subd. (a).) As far as the record shows, appellant never denied that he paid for the trip.

Thus, given appellant’s weak and incomplete showing of indigency, the trial court did not act arbitrarily, capriciously or absurdly in denying appellant’s motion for relief from the undertaking.

Appellant also argues that, instead of granting respondents’ motion for dismissal, the trial court should have vacated its order requiring an undertaking because he had been granted in forma pauperis status. Appellant first brought this new fact to the Judge Kurt J. Lewin’s attention in his opposition to the motion to dismiss, which was filed on October 8, 1999. As far as the record shows, appellant failed to show diligence or explain the delay. He had first raised his indigence claim in his motion for relief on May 11, 1999, and the court did not hear that motion until June 7, 1999. Appellant could have sought in forma pauperis status at or near the time he filed his motion for relief or immediately after the denial of his motion for relief. Instead, he waited nearly three months. Even after he obtained the order waiving filing fees on September 1, 1999, he failed to bring it to Judge Lewin’s attention for another five weeks. Thus, appellant let nearly six months pass before he raised the most persuasive argument he could muster in support of his quest for relief from the requirement of an undertaking.

It is thus easy to understand why the trial court would disregard appellant’s belated showing. Nonetheless, given the finding of indigency necessarily underlying the in forma pauperis order, the trial court acted arbitrarily and capriciously in refusing to either vacate or reduce the amount of the undertaking.

In addition, dismissal of appellant’s case resulted in a manifest miscarriage of justice. It effectively precluded appellant from litigating his claims simply because he is indigent and respondents proved a reasonable possibility of success. Despite the apparent existence of serious flaws in appellant’s case and the arbitration decision in respondents’ favor, appellant may nonetheless obtain a verdict in his favor at trial. To first require him to do the impossible, i.e., post a $22,000 undertaking, would be an unconscionable burden on his attempt to seek redress for his injuries and property damage.

Given our ruling, we need not consider appellant’s constitutional claims.

Disposition

The judgment is reversed and remanded. Each party is to bear its own costs on appeal.

Lillie, P. J., concurred.

* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.