California Court of Appeals, Fourth District, First Division
APPEAL from a judgment of the Superior Court of Riverside County No. RIC523036, Paulette Durand-Barkley, Commissioner.
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Robinson Calcagnie Robinson Shapiro Davis, Kevin F. Calcagnie and Patrick B. Embrey for Plaintiff and Appellant and for Objectors and Appellants.
Best Best & Krieger, Kira L. Klatchko and Irene S. Zurko for Defendant and Respondent.
Alberto Daniel Saucedo Suarez and his attorneys, Allan F. Davis and the law firm of Robinson Calcagnie Robinson Shapiro Davis, Inc. (together, the Attorneys and with Suarez, Appellants), appeal from the trial court's award of attorney fees and costs to the City of Corona (the City) under Code of Civil Procedure section 1038 (section 1038). (Undesignated statutory references are to this code.) Appellants contend the trial court erred because (1) section 1038 does not authorize an award of attorney fees and costs against a party's counsel, (2) the commissioner issuing the award did not have jurisdiction, (3) the award was not proper where the action was brought and maintained with reasonable cause, (4) the fees and costs awarded were not reasonably and necessarily incurred, and (5) the award violated due process. We agree that section 1038 does not authorize an award of fees and costs
against a party's attorney. Accordingly, we reverse that portion of the judgment awarding the City its fees and costs against the Attorneys. In all other respects, we affirm.
FACTUAL AND PROCEDURAL BACKGROUND
In 2008, Suarez was injured when the compressed natural gas (CNG) tank in a van in which he was a passenger exploded while being filled at a fueling station owned by the City. In April 2009, Suarez sued the City and a number of other defendants. Suarez proceeded against the City on a theory of dangerous condition of public property under Government Code section 835.
According to the Corona Fire Department fire investigation report, the explosion was an accident caused by the rupturing of a CNG cylinder in the van. Shortly after the accident, the Southern California Gas Company tested the fuel lines at the filling station. It did not discover any leaks in the lines.
Appellants requested to inspect the CNG tank and the van to which the tank had been affixed at the time of the accident. Those inspections took place in October 2009. Livio Gambone, an engineer with experience in alternative fuels vehicle testing and failure analysis of CNG cylinders, examined the van's ruptured cylinder. Gambone found the cylinder had "stress corrosion cracking, " which is "cracking induced from the combined influence of tensile stress and a corrosive environment." Gambone's tests of the cylinder revealed the presence of sulphuric acid. He concluded the CNG cylinder ruptured during fueling "as a result of exposure to sulphuric acid from contents carried in the cargo area of the subject van."
In November 2009, the City served Suarez with a statutory offer to compromise under section 998. In that offer, the City agreed to waive costs in exchange for a dismissal with prejudice. Suarez did not respond to the offer and it expired.
Between December 2009 and April 2010, the City responded to Suarez's written discovery requests. The City produced maintenance and inspection reports for the CNG system and dispenser and the fire investigation report. The City also provided information that since the CNG system became operational, the City did not have reports of any prior incidents or claims for damages in regard to any aspect of the CNG system or dispenser. Suarez did not propound additional discovery, set depositions of the City's personnel or notice inspections of the CNG station.
In early 2011, Appellants requested that the City transfer the CNG tank and van to them. The City responded by stating that it would agree to waive costs
and release the tank and van in exchange for dismissal of the City. The City informed Appellants that the evidence did not establish that the City had notice of a dangerous condition. Moreover, the City reminded Appellants that although they had the City's discovery responses and documents for over a year, they had not proceeded with other discovery with respect to the City and the case had been idle for a significant period of time. Due to the lack of evidence of a dangerous condition, the City requested that Suarez provide them with his theory of liability against the City. The Attorneys did not respond to this inquiry and refused to dismiss the City.
In May 2011, the City reiterated its request that Suarez articulate a theory of liability against it. The City also informed Appellants that defense costs had increased dramatically because the case was nearly three years old and suggested dismissal of the City before the City filed a motion for summary judgment.
In May and June 2011, Appellants deposed the City's personnel. Xente Baker, who had investigated the accident, testified there was no indication that the source of the ignition came from the fuel dispenser. He also stated that he did not identify any design defects or issues with the City's operation or maintenance of the filling station. Steve Szueber, another City employee, testified that the City had never received any complaints regarding overpressurization, overfilling, or dispenser design defects. Szueber was not aware of any dispenser or valve malfunctions or gas leaks occurring at the time of the accident.
After the depositions, the City again demanded that Appellants dismiss the case due to lack of evidence regarding the City's liability or provide the City with Suarez's theory of liability. The City also informed the Attorneys that in light of the lack of evidence against the City and the absence of articulated facts supporting Suarez's theory of liability, the lawsuit was frivolous within the meaning of section 1038. The City ...