Doe v. San Diego-Imperial Council ( 2017 )

Filed 10/17/17 CERTIFIED FOR PUBLICATION
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
JOHN PD DOE, D070414
Plaintiff and Appellant,
v. (Super. Ct. No. 37-2013-00029313-
CU-PO-NC)
SAN DIEGO-IMPERIAL COUNCIL et al.,
Defendants and Respondents.
APPEAL from an order of the Superior Court of San Diego County,
Timothy M. Casserly, Judge. Reversed.
Manly Stewart & Finaldi, John C. Manly, Vince W. Finaldi, Sky L. Daley; Esner,
Chang & Boyer, Stuart B. Esner, Andrew N. Chang, Holly N. Boyer and Joseph S.
Persoff for Plaintiff and Appellant.
White & Amundson, Daniel M. White and Rebecca D. Lack for Defendants and
Respondents.
I.
INTRODUCTION
Plaintiff John PD Doe was sexually abused by a Boy Scout master beginning in
1998 and continuing for a number of years at a ranch owned and operated by the
defendants, San Diego-Imperial Council and Boy Scouts of America (the defendants). In
2013, many years after the abuse and after Doe obtained psychological therapy, he filed
this action against the defendants. The defendants ultimately demurred to Doe's
complaint on the ground that he failed to file a certificate of merit, as required by Code of
Civil Procedure section 340.1 (section 340.1), which applies to actions to recover
damages for childhood sexual abuse. The trial court sustained the defendants' demurrer
on this ground, without leave to amend. Doe appealed the trial court's judgment, and this
court affirmed the judgment in favor of the defendants in Doe v. San Diego-Imperial
Council (2015) 239 Cal.App.4th.81 (Doe I).
Following the issuance of the remittitur, the defendants moved for an award of
attorney fees with respect to the fees incurred in defendant Doe's appeal. The defendants
sought attorney fees pursuant to subdivision (q) of section 340.1. That provision
provides that at the conclusion of litigation involving childhood sexual abuse, if the
litigation has come to a "favorable conclusion . . . with respect to any defendant" as to
whom the plaintiff was required to file a certificate of merit, either the defendant or the
court may verify the plaintiff's compliance with the certificate of merit requirement. If
the court finds that the plaintiff failed to comply with the certificate of merit requirement,
the court may award attorney fees to the defendant for whom the certificate of merit
requirement was not met. (§ 340.1, subd. (q).)
The trial court awarded the defendants the fees that they requested without
analyzing the statutory provision or stating the court's reasoning as to why such fees were
appropriate.
2
Doe appeals from the trial court's order awarding the defendants attorney fees
resulting from the prior appeal. Doe contends that section 340.1, subdivision (q) was
designed to permit an award of attorney fees only in situations in which there is some
indication that the plaintiff's claim of sexual abuse is without merit, such that the
conclusion of the litigation may be deemed to constitute a " [']favorable conclusion of the
litigation with respect to['] " the defendants for whom a certificate of merit was filed or
should have been filed. Doe asserts that in this case, where the trial court acknowledged
that Doe's claim was not frivolous, and there was no indication that the claim lacked
merit, the defendants were not eligible for an award of attorney fees pursuant to section
340.1, subdivision (q).
The defendants contend that they are entitled to attorney fees pursuant to section
340.1, subdivision (q) because they obtained a dismissal of the action, and, as a result,
they are prevailing parties and are entitled to attorney fees. They assert that a "favorable
conclusion" is not a prerequisite to an award of attorney fees under section 340.1,
subdivision (q), and that even if a "favorable conclusion" is a prerequisite, the dismissal
of Doe's complaint constitutes such a "favorable conclusion."
We conclude that a defendant is eligible for an award of attorney fees pursuant to
section 340.1, subdivision (q) only where the litigation has resulted in a "favorable
conclusion" for that defendant, and that a "favorable conclusion" requires a result that is
reflective of the merits of the litigation. In this case, the dismissal of Doe's action was
procured as a result of a procedural defect that does not reflect on the merits of the action.
As a result, there was no "favorable conclusion" with respect to the defendants, and they
3
are therefore not eligible to be awarded their attorney fees pursuant to section 340.1,
subdivision (q). We therefore reverse the order of the trial court awarding the defendants
attorney fees.
II.
FACTUAL AND PROCEDURAL BACKGROUND1
Plaintiff John Doe was a Boy Scout who attended the Mataguay Scout Ranch (the
Ranch) where Glenn Jordan was an employee. The Ranch is owned and operated by
defendants San Diego-Imperial Council and Boy Scouts of America. As alleged by Doe,
beginning in the summer of 1998, when Doe was 14 years old, and continuing until
approximately 2000, Jordan repeatedly sexually abused Doe. According to Doe, the
defendants knew that Jordan had a propensity to molest children, but they failed to warn
Doe or his family, or other camp attendees.
In 2003, when Doe was approximately 19 or 20 years old, the defendants provided
counseling for Doe because of the abuse he had suffered. Through the counseling
process, Doe realized that the sexual abuse had caused him to suffer emotional and
psychological problems.
In November 2012, Doe retained counsel. On January 9, 2013, Doe filed this
action against the defendants alleging various causes of action. After the defendants
demurred, Doe filed a first amended complaint. The defendants again demurred and
moved to strike the complaint, arguing, among other things, that the entire first amended
1 We summarize these facts from the factual background provided in this court's
opinion in Doe I, supra, 239 Cal.App.4th at p. 85.
4
complaint was subject to demurrer or should be stricken because Doe had failed to file
certificates of merit, as required under section 340.1, subdivision (g). The trial court
sustained the demurrer without leave to amend on this ground and concluded that the
motion to strike was moot. After hearing oral argument, the trial court confirmed its
ruling and later entered judgment in favor of the defendants.
Doe appealed the trial court's judgment, arguing that Insurance Code section
11583 tolled the statute of limitation for his claims. According to Doe, although section
340.1 requires any plaintiff who is 26 years of age or older at the time the action is filed
to file certificates of merit together with the complaint, and even though he was
chronologically 29 years old when he filed his lawsuit, under the tolling provisions
of Insurance Code section 11583, he should have been considered to have been only 20
years old at the time he filed his complaint. (Doe I, supra, 239 Cal.App.4th at p. 85.)
Doe asserted that the tolling provision of Insurance Code section 11583 applied to him as
a result of the defendants' failure to notify him in writing about the statute of limitations
when the defendants provided him counseling for the emotional suffering that he endured
as a result of the sexual abuse. (Doe I, supra, at p. 88.) In the prior appeal in this case,
addressing what was an issue of first impression, this court ultimately disagreed with
Doe's legal argument and affirmed the trial court's judgment, but in doing so, noted that
the statutory framework might prevent plaintiffs from prosecuting even meritorious
claims. (Id. at pp. 87, 90, 92.)
After the judgment became final, the defendants moved for an award of the
attorney fees that they had incurred on appeal, pursuant to section 340.1, subdivision (q)'s
5
attorney fees provision. The trial court awarded the defendants the fees that they
requested, without explanation. Doe filed a timely appeal from the trial court's order
granting the defendant's motion for attorney fees.
III.
DISCUSSION
Section 340.1 sets forth procedural guidelines that must be followed when a
plaintiff seeks to pursue a childhood sex abuse claim. Subdivision (g) of section 340.1
requires that any plaintiff who is 26 years of age or older at the time the action is filed
must file certificates of merit together with the complaint. The purpose of the certificate
of merit requirement is to reduce the filing of frivolous claims by imposing a pleading
hurdle. (Jackson v. Doe (2011) 192 Cal.App.4th 742, 752 (Jackson).)
Subdivision (q) of section 340.1 includes the provision's only reference to attorney
fees. That provision states in full:
"Upon the favorable conclusion of the litigation with respect to any
defendant for whom a certificate of merit was filed or for whom a
certificate of merit should have been filed pursuant to this section,
the court may, upon the motion of a party or upon the court's own
motion, verify compliance with this section by requiring the attorney
for the plaintiff who was required by subdivision (h) to execute the
certificate to reveal the name, address, and telephone number of the
person or persons consulted with pursuant to subdivision (h) that
were relied upon by the attorney in preparation of the certificate of
merit. The name, address, and telephone number shall be disclosed
to the trial judge in camera and in the absence of the moving party.
If the court finds there has been a failure to comply with this section,
the court may order a party, a party's attorney, or both, to pay any
6
reasonable expenses, including attorney's fees, incurred by the
defendant for whom a certificate of merit should have been filed."2
The parties dispute the proper interpretation of subdivision (q) of section 340.1.
The defendants contend that a defendant may obtain an attorney fee award any time a
plaintiff has failed to comply with the certificate of merit requirement set forth in
subdivision (h) of section 340.1. Doe contends that a defendant is eligible to obtain
2 Subdivision (h) of section 340.1, as referenced by subdivision (q), provides:
"(h) Certificates of merit shall be executed by the attorney for the
plaintiff and by a licensed mental health practitioner selected by the
plaintiff declaring, respectively, as follows, setting forth the facts
which support the declaration:
"(1) That the attorney has reviewed the facts of the case, that the
attorney has consulted with at least one mental health practitioner
who is licensed to practice and practices in this state and who the
attorney reasonably believes is knowledgeable of the relevant facts
and issues involved in the particular action, and that the attorney has
concluded on the basis of that review and consultation that there is
reasonable and meritorious cause for the filing of the action. The
person consulted may not be a party to the litigation.
"(2) That the mental health practitioner consulted is licensed to
practice and practices in this state and is not a party to the action,
that the practitioner is not treating and has not treated the plaintiff,
and that the practitioner has interviewed the plaintiff and is
knowledgeable of the relevant facts and issues involved in the
particular action, and has concluded, on the basis of his or her
knowledge of the facts and issues, that in his or her professional
opinion there is a reasonable basis to believe that the plaintiff had
been subject to childhood sexual abuse.
"(3) That the attorney was unable to obtain the consultation required
by paragraph (1) because a statute of limitations would impair the
action and that the certificates required by paragraphs (1) and
(2) could not be obtained before the impairment of the action. If a
certificate is executed pursuant to this paragraph, the certificates
required by paragraphs (1) and (2) shall be filed within 60 days after
filing the complaint."
7
attorney fees only if the plaintiff failed to comply with the certificate of merit
requirement and the defendant obtained a favorable conclusion in the litigation.
The defendants contend that even if Doe is correct that the defendant must have
obtained a favorable conclusion in the litigation in order for that defendant to be eligible
for an award of attorney fees, this matter was concluded in their favor when the case was
dismissed. Doe counters that the language used in section 340.1, subdivision (q) has
been given specialized meaning by a court that construed the identical phrase in a similar
statute involving claims for malpractice, and that this specialized meaning requires that
the lawsuit have been concluded favorably for the defendants on the merits, rather than
on mere procedural grounds.
A. Statutory interpretation
"Our primary task in interpreting a statute is to determine the Legislature's intent,
giving effect to the law's purpose. [Citation.] We consider first the words of a statute, as
the most reliable indicator of legislative intent. [Citation.] ' " 'Words must be construed
in context, and statutes must be harmonized, both internally and with each other, to the
extent possible.' [Citation.] Interpretations that lead to absurd results or render words
surplusage are to be avoided." ' " (Tuolumne Jobs & Small Business Alliance v. Superior
Court (2014) 59 Cal.4th 1029, 1037.)
To the extent that the statutory language is ambiguous, "we may resort to extrinsic
sources, including the ostensible objects to be achieved and the legislative history." (Day
v. City of Fontana (2001) 25 Cal.4th 268, 272.) "If the statutory language permits more
than one reasonable interpretation, courts may consider other aids, such as the statute's
8
purpose, legislative history, and public policy." (Coalition of Concerned Communities,
Inc. v. City of Los Angeles (2004) 34 Cal.4th 733, 737; accord, Imperial Merchant
Services, Inc. v. Hunt (2009) 47 Cal.4th 381, 388.) Further, a "statute's every word and
provision should be given effect so that no part is useless, deprived of meaning or
contradictory. Interpretation of the statute should be consistent with the purpose of the
statute and statutory framework." (Fireman's Fund Ins. Co. v. Workers' Comp. Appeals
Bd. (2010) 189 Cal.App.4th 101, 109–110.) " ' "An interpretation that renders related
provisions nugatory must be avoided [citation]; each sentence must be read not in
isolation but in the light of the statutory scheme [citation]; and if a statute is amenable to
two alternative interpretations, the one that leads to the more reasonable result will be
followed." ' " (People v. Kirk (2006) 141 Cal.App.4th 715, 720–721.)
B. Application
1. The Legislature intended to provide for an award of attorney fees to a
defendant only "[u]pon the favorable conclusion of the litigation" with
respect to that defendant
The parties disagree as to the circumstances under which a defendant is eligible to
be awarded attorney fees pursuant to subdivision (q) of section 340.1.3 Doe contends
3 For ease of reference, we repeat the text of this subdivision here:
"Upon the favorable conclusion of the litigation with respect to any
defendant for whom a certificate of merit was filed or for whom a
certificate of merit should have been filed pursuant to this section,
the court may, upon the motion of a party or upon the court's own
motion, verify compliance with this section by requiring the attorney
for the plaintiff who was required by subdivision (h) to execute the
certificate to reveal the name, address, and telephone number of the
person or persons consulted with pursuant to subdivision (h) that
9
that a defendant may be awarded attorney fees "only if it is discovered after the case
concludes with a determination on the merits in favor of the defendant that the plaintiff
did not comply with the certificate of merit requirement."
The defendants contend that the sentence that refers to attorney fees should be
considered to be separate from the other two sentences in subdivision (q), such that there
is no need for a party to establish that the party obtained a "favorable conclusion" in order
to be eligible for an award of attorney fees. Specifically, the defendants argue:
"Subdivision (q) consists of three sentences. The first sentence deals
with a motion to compel disclosure of the name and contact
information of the person relied upon in preparing the certificate of
merit. This motion is to be made 'upon the favorable conclusion of
the litigation.' The second sentence states that any such disclosure
should be made to the judge in camera. Th[e] third sentence reads
as follows:
"If the court finds there has been a failure to comply with this
section, the court may order a party, a party's attorney, or both, to
pay any reasonable expenses, including attorney's fees, incurred by
the defendant for whom a certificate of merit should have been filed.
(Civ. Proc. Code, § 340.l, subd. (q).)
"Nothing in this third sentence says that a 'favorable conclusion' is
required for the court to award attorney's fees and no case law
supports this premise."
were relied upon by the attorney in preparation of the certificate of
merit. The name, address, and telephone number shall be disclosed
to the trial judge in camera and in the absence of the moving party.
If the court finds there has been a failure to comply with this section,
the court may order a party, a party's attorney, or both, to pay any
reasonable expenses, including attorney's fees, incurred by the
defendant for whom a certificate of merit should have been filed."
(§ 340.1, subd. (q).)
10
We agree with Doe that the more reasonable interpretation of subdivision (q) is
that all three sentences placed in that subdivision are intended to relate to each other.
Although it is true that the third sentence in subdivision (q), which refers to attorney fees,
does not independently include the phrase "favorable conclusion," that phrase is included
in the first sentence of the subdivision. All three of these sentences involve what may
occur when the litigation has been concluded in a defendant's favor. All three sentences
should be read together. The meaning and impact of doing so is that in a case where the
litigation terminates in a defendant's favor, the defendant or the court may move to verify
the plaintiff's certificate of merit, and, if the court finds a failure to comply with
subdivision (q)'s certificate of merit requirement, the court may award the defendant his
or her reasonable expenses, including attorney fees.
The defendants' position, that each sentence of subdivision (q) in section 340.1
should be read independently from the other sentences in that subdivision makes little
sense, given the Legislature's use of the subdivision structure in section 340.1. The
organizing structure of the provision, including its framing of a variety of matters into
discrete subdivisions, should be given some effect with respect to the meaning to be
given to the language that appears in those subdivisions. It is patently more reasonable to
conclude that sentences that are placed together in a single subdivision should be
considered to relate to each other, as opposed to being wholly independent from one
another.
Indeed, others have adopted our interpretation of subdivision (q). In the California
Judges Benchbook, the following explanation of this provision is provided:
11
"On the favorable conclusion of the litigation with respect to any
defendant, the judge may, on a party's motion or on the judge's own
motion, verify compliance with the requirements of CCP §340.1 by
requiring the plaintiff's attorney to reveal the name, address, and
telephone number of each person the attorney consulted under CCP
§340.1(h) and that the attorney relied on in preparing the certificate
of merit. CCP §340.1(q). This information must be disclosed to the
judge in chambers and in the absence of the moving party. If the
judge finds that the attorney failed to comply with the statutory
requirements, the judge may order the plaintiff and/or the attorney to
pay any reasonable expenses, including attorney's fees, the defendant
incurred. CCP §340.1(q). A violation of the statutory requirements
may constitute unprofessional conduct and may be grounds for
discipline of the plaintiff's attorney. CCP §340.1(k)." (Cal. Judges
Benchbook: Civil Proceedings Before Trial (CJER 2008) Attacks on
Pleadings, § 12.189, p. 111.)
Not only does the structure of subdivision (q) favor this interpretation, but a
review of other subdivisions of section 340.1 also supports an interpretation that allows
for an award of attorney fees only upon a finding that the litigation has been concluded in
a defendant's favor. Specifically, the Legislature placed the attorney fees reference in
subdivision (q), together with the reference to "[u]pon the favorable conclusion of the
litigation with respect to any defendant," and chose not to include a reference to an award
of attorney fees in subdivision (l), which is the subdivision that states that the "failure to
file certificates in accordance with this section shall be grounds for a demurrer pursuant
to Section 430.10 or a motion to strike pursuant to Section 435." If the Legislature had
intended to authorize an award of attorney fees to a defendant in a situation in which a
case is dismissed as a result of a plaintiff's failure to file a certificate of merit as required
by section 340.1, one would expect that the Legislature would have included language in
subdivision (l) to expressly provide that a defendant is eligible to obtain an attorney fee
12
award in connection with a successful demurrer or motion to strike. However, it did not
do so.
In addition, our interpretation of the statute would effectuate the discernable
purpose of the statute—i.e., a reduction in the filing of frivolous claims. (See Jackson,
supra, 192 Cal.App.4th at p. 752 ["The legislative materials indicate that the purpose of
the certificates of merit requirements is to impose 'pleading hurdles aimed at reducing
frivolous claims' "].) The attorney fee provision in subdivision (q) of section 240.1 is not
a reciprocal provision; it provides for only a defendant to obtain attorney fees. It thus
appears clear that the attorney fee provision is intended to act as a deterrent to the filing
of frivolous claims. A plaintiff risks having to pay the defendant's attorney fees upon the
conclusion of litigation in favor of the defendant on the merits if the plaintiff fails to
comply with the requirements regarding the filing of a certificate of merit.
The defendants' reliance on Guinn v. Dotson (1994) 23 Cal.App.4th 262 (Guinn) is
misplaced. Guinn involved the application of Code of Civil Procedure section 411.35,
which both parties agree imposes an identical certificate of merit requirement with
respect to malpractice actions against certain professionals, and also provides for an
award of attorney fees by use of language that is substantively identical to that found in
subdivision (q) of section 340.1. (See Guinn, supra, 23 Cal.App.4th at pp. 265–266.)4
4 The relevant provision of Code of Civil Procedure section 411.35, subdivision (h)
provides as follows:
"Upon the favorable conclusion of the litigation with respect to any
party for whom a certificate of merit was filed or for whom a
certificate of merit should have been filed pursuant to this section,
13
In Guinn, the court sustained the defendant's demurrer without leave to amend due
to the plaintiffs' failure to file proper certificate of merit. (Guinn, supra, 23 Cal.App.4th
p. 266.) The court subsequently awarded the defendant attorney fees pursuant to Code of
Civil Procedure section 411.35. However, in doing so, the court declined to award the
defendant his paralegal fees as part of the award of attorney fees. (Guinn, supra, at p.
266.) On appeal, the plaintiffs argued that the trial court abused its discretion in
sustaining the defendant's demurrer to the second amended complaint without leave to
amend and in not ruling on the plaintiff's motion to allow the late filing of a certificate of
merit. (Ibid.) The defendant also appealed, arguing that the trial court had abused its
discretion in refusing to award paralegal fees as part of the fee award. (Ibid.) The
plaintiffs did not contest whether the defendant was eligible to obtain attorney fees under
Code of Civil Procedure section 411.35 as a result of having obtained a favorable
conclusion in the litigation. As a result, the Guinn court had no opportunity to consider
whether the attorney fee provision in Code of Civil Procedure section 411.35 permitted
an award of attorney fees regardless of whether the defendant obtained a favorable
the trial court may, upon the motion of a party or upon the court's
own motion, verify compliance with this section, by requiring the
attorney for the plaintiff or cross-complainant who was required by
subdivision (b) to execute the certificate to reveal the name, address,
and telephone number of the person or persons consulted with
pursuant to subdivision (b) that were relied upon by the attorney in
preparation of the certificate of merit. The name, address, and
telephone number shall be disclosed to the trial judge in an in-
camera proceeding at which the moving party shall not be present.
If the trial judge finds there has been a failure to comply with this
section, the court may order a party, a party's attorney, or both, to
pay any reasonable expenses, including attorney's fees, incurred by
another party as a result of the failure to comply with this section."
14
conclusion in the action. " ' " '[I]t is axiomatic that cases are not authority for
propositions not considered.' " ' " (Riverside County Sheriff's Dept. v. Stiglitz (2014) 60
Cal.4th 624, 641.)
In addition, in Guinn, the plaintiffs' attempt to comply with an alternative to the
certificate of merit requirement was a sham. Specifically, the plaintiff had filed a "res
ipsa certificate," which would have obviated the need for a certificate of merit under
Code of Civil Procedure section 411.35. (Guinn, supra, 23 Cal.App.4th at p. 266.) The
trial court determined that the statement in the certificate filed with the second amended
complaint stated that the plaintiffs were relying solely on the doctrine of res ipsa loquitur,
but that this statement "was in direct conflict with the allegations of the second amended
complaint." (Ibid.)
Guinn simply does not stand for the proposition that the defendants suggest it
does. Specifically, Guinn does not support the defendants' contention that a successful
demurrer to a complaint for failure to file the required certificate of merit is sufficient to
entitle a defendant to an award of attorney fees pursuant to section 340.1, subdivision (q),
irrespective of whether the litigation was "favorabl[y] conclu[ded] . . . with respect to
[that] defendant." (§ 340.1, subd. (q).) We therefore conclude that Guinn offers no
persuasive analysis with respect to how to interpret subdivision (q) of section 340.1, and
it does not alter our statutory interpretation of the relevant language.
15
2. A "favorable conclusion" requires some determination on the merits of the
action
The parties disagree as to what the phrase "[u]pon the favorable conclusion of the
litigation with respect to any defendant" means.
The defendants argue that a "judgment of dismissal in favor of the [defendants],
affirmed by the court of appeal, satisfies [the 'favorable conclusion'] requirement."
(Capitalization & boldface omitted.) Doe contends that in order for there to be a
"favorable conclusion" of litigation with respect to a defendant, there must be some
indication that the conclusion reflects on the merits of the case, "such as a [ruling on a]
motion for summary judgment or a jury verdict."
We begin by noting that section 340.1, subdivision (q) utilizes the "favorable
conclusion" language, and does not refer to a "prevailing party" or the "prevailing
defendant." Our review of the Code suggests that this "favorable conclusion" language is
found only in section 340.1, subdivision (q) and in Code of Civil Procedure section
411.35, subdivision (h), which is the provision that was at issue in Guinn, supra, 23
Cal.App.4th 262, and which is virtually identical to subdivision (q) of section 340.1.
Importantly, another court has already interpreted the "favorable conclusion"
language in the context of Code of Civil Procedure section 411.35, subdivision (h). The
court in Korbel v. Chou (1994) 27 Cal.App.4th 1427 (Korbel) considered whether a
settlement between the parties constituted a "favorable conclusion" of the litigation for
purposes of an award of attorney fees pursuant to subdivision (h) of section 411.35. The
Korbel court noted that it could find no published opinion "addressing whether a case
16
dismissed pursuant to a settlement is a 'favorable conclusion' "; the Korbel court therefore
looked to authorities that examined the meaning of the phrase "favorable termination" in
the context of a malicious prosecution action. (Korbel, supra, at p. 1430.)
The Korbel court determined that a "favorable conclusion" within the meaning of
section 411.35, subdivision (h) "is the same as a favorable termination," and that both
require a conclusion that is reflective of the merits of the plaintiff's action. (Korbel,
supra, 27 Cal.App.4th at p. 1431.) "Favorable termination was defined by our Supreme
Court over 50 years ago in Jaffe v. Stone (1941) 18 Cal.2d 146. 'The theory underlying
the requirement of favorable termination is that it tends to indicate the innocence of the
accused . . . . If the accused were actually convicted, the presumption of his [or her] guilt
or of probable cause for the charge would be so strong as to render wholly improper any
action against the instigator of the charge. . . . The same fundamental theory is applied in
testing a dismissal or other termination without a complete trial on the merits. If it is of
such a nature as to indicate the innocence of the accused, it is a favorable termination
sufficient to satisfy the requirement. If, however, the dismissal is on technical grounds,
for procedural reasons, or for any other reason not inconsistent with his [or her] guilt, it
does not constitute a favorable termination.' " (Korbel, supra, at pp. 1431–1432.)
Therefore, " '[i]n order for the termination of the lawsuit to be considered "favorable" to
the malicious prosecution plaintiff, it must be reflective of the merits of the action and of
the plaintiff's innocence of the misconduct alleged therein.' [Citation.] To determine
whether a 'favorable termination' occurred when the 'proceeding is terminated other than
on its merits, the reasons underlying the termination must be examined to see if it reflects
17
the opinion of either the court or the prosecuting party that the action would not
succeed.' " (Id. at p. 1431.)
The Korbel court noted that there are a number of reasons why "a favorable
conclusion is the same as a favorable termination," and that it is of no consequence that
the Legislature used the word "conclusion" in section 411.35 while the malicious
prosecution law refers to a "termination." (Korbel, supra, 27 Cal.App.4th at p. 1431.)
Significantly, "[t]he purpose of [section 411.35] and a malicious prosecution action are
exactly the same. Subdivision (h)'s purpose is to provide sanctions and attorney fees for
frivolous lawsuits. (Sen. Com. on Judiciary, Analysis of Sen. Bill No. 1718 (1987–1988
Reg. Sess.) as introduced May 3, 1988.) The purpose behind a malicious prosecution
action is to provide a remedy for unjustifiable lawsuits. [Citation.] In a section 411.35,
subdivision (h) motion, the litigation must end in a 'favorable conclusion' before
sanctions and attorney fees can be awarded. Similarly, the underlying suit in a malicious
prosecution action must end in a 'favorable termination' or the action cannot be
maintained. In other words, both require the litigation to end favorably before costs or
fees can be awarded for an unjustified lawsuit." (Korbel, supra, at p. 1432.) Further,
such a conclusion "is consistent with basic statutory interpretation." (Ibid.) " '[W]e first
consult the words themselves, giving them their usual and ordinary meaning.' [Citation.]
'Favorable' is defined as 'giving a result that is in one's favor'; 'conclusion' means 'the last
part of anything: close, termination, end.' (Webster's New Internat. Dict. (3d ed. 1961)
pp. 471 & 830.) The plain meaning of 'favorable conclusion' is the litigation ended in
18
defendant's favor. In other words, there was a favorable termination to the litigation."
(Ibid.)
We agree with the Korbel court's analysis and conclude that, given that section
411.35, subdivision (h) and section 340.1, subdivision (q) use virtually identical
language, it is appropriate to apply the Korbel court's interpretation of "favorable
conclusion" as used in section 411.35, subdivision (h) to that same phrase as used in
section 340.1, subdivision (q).
3. The dismissal in this case does not reflect on the merits of this
litigation, and therefore does not constitute a "favorable conclusion"
We now consider whether the dismissal is this case reflects the opinion of either
the court or the prosecuting party that the action would not succeed, such that the court's
sustaining of defendants' demurrer without leave to amend may be considered a
"favorable conclusion." The dismissal occurred as a result of the sustaining of a demurrer
based on the existence of a procedural defect, i.e., the failure to file the requisite
certificates of merit, and not as a result of the plaintiff or the court viewing the case as
unmeritorious. In fact, in our prior opinion in this matter, this court noted that a dismissal
on the basis of a failure to comply with the certificate of merit requirement does not
necessarily indicate that a plaintiff's claims are without merit: "Even where plaintiffs
may have meritorious claims, their failure to comply with the certificate of merit
requirement prevents them from prosecuting their claims." (Doe I, supra, 239
Cal.App.4th at p. 87.) Here, there is no indication in the record that the merits of Doe's
claims were considered at all, or that the sustaining of the demurrer was the result of a
19
determination that his claims were without merit. The absence of any indication that the
termination of this litigation is reflective of the merits of the action precludes a
determination that the litigation was favorably concluded with respect to the defendants.
Because the dismissal of this action does not constitute a "favorable conclusion" of
the litigation with respect to the defendants, the defendants were not eligible to obtain an
award of attorney fees pursuant to subdivision (q) of section 340.1. The trial court
therefore erred in awarding the defendants attorney fees under this statutory provision.
IV.
DISPOSITION
The order of the trial court awarding the defendants attorney fees is reversed. Doe
is entitled to costs on appeal.
AARON, J.
WE CONCUR:
BENKE, Acting P. J.
DATO, J.
20