DEIRDRE HILL et al., Petitioners, v. THE SUPERIOR COURT OF ALAMEDA COUNTY, Respondent; FRANK E. STAGGERS, JR., Real Party in Interest.
No. A145893
First Dist., Div. Two.
Feb. 18, 2016.
1281
RICHMAN, J.
Michael Ryan Dougherty and Steven Jay Rood for Petitioners.
No appearance for Respondent.
Triay Law Office, Paul D. Epstein, Charles A. Triay; Kong Law Firm and Miguel O. Barquera for Real Party in Interest.
OPINION
RICHMAN, J.--Petitioners in this writ proceeding are Deirdre Hill and Vincent G. Hughes (collectively petitioners), co-executors of their mother‘s estate. They filed a proceeding against their stepfather, Frank Staggers, Sr., to recover property belonging to the estate, which among other things requested a judgment for twice the value of the property recovered, as provided for by
The superior court granted summary adjudication against petitioners, concluding that the double damages sought were precluded under
BACKGROUND
On March 25, 2013, petitioners filed a petition against their stepfather, Frank Staggers, Sr., to recover property belonging to their mother‘s estate. The prayer of the petition requested among other things “[t]hat the court determine whether Frank Staggers acted wrongfully in bad faith concealing assets of the estate from petitioners as co-executors, and if so, compelling Frank Staggers to pay a penalty of twice the value of the assets recovered.” The basis of the claim for twice the value of the property was
Frank Staggers, Sr., died during the proceeding, and his son, Frank E. Staggers, Jr. (real party in interest), was substituted in as the respondent in the probate proceeding.
On April 8, 2015, real party in interest filed a motion for summary adjudication that the claim for double damages had no merit because those damages cannot be recovered against him as the successor to his father. The basis of the motion was
Petitioners filed their memorandum in opposition, which also relied on one case: Jahns v. Nolting (1866) 29 Cal. 507 (Jahns).
Real party in interest filed his reply, and the matter came on for argument on July 14, prior to which the court had issued a tentative ruling favorable to real party in interest. After conclusion of argument, the trial court confirmed the tentative ruling and entered a minute order granting the motion. The sole substantive paragraph of the order read as follows: “Double damages provided in
Petitioners sought a writ in this court, arguing essentially that Jahns is controlling authority and that the superior court erred in following what was mere dictum in Young. On September 29, we issued an alternative writ, stating that “respondent superior court erred when it held that
On October 6, the superior court advised that it would take no action in response to the alternative writ, and would let real party in interest file a return. On October 23, real party in interest filed a return to the petition for peremptory writ. On November 5, petitioners filed a reply and opposition to the return.
DISCUSSION
As quoted,
Witkin has an exhaustive discussion of “[p]unitive or [e]xemplary [d]amages.” (See 6 Witkin, Summary of Cal. Law (10th ed. 2005) Torts, p. 1035; see id., §§ 1559-1623, pp. 1035-1137.) In the course of that discussion, the author makes several observations pertinent here, which begin in a section entitled “Statutory Penalties Distinguished.” (Id., at p. 1057, italics added.) The discussion first observes that “[s]ometimes a statute imposes a penalty in an arbitrary sum irrespective of actual damage suffered.” (Id., § 1569, p. 1057.) The next section says that “[a]nother type of statute allows treble damages, i.e., on proof of actual damage, an award of three times the amount may be given.” (Id., § 1570, p. 1059.) And then comes section 1571. It is entitled “Recovery of Both Penalty and Punitive Damages,” and it says this: “Dual Remedies Permitted. The fact that a statutory penalty or even criminal liability is imposed for a particular wrongful act does not preclude recovery of punitive damages in a tort action where the necessary malice or oppression is shown, and it is possible that the defendant may be punished criminally and forced to respond in punitive damages for the same act. [Citations.]” (Id., § 1571, p. 1060.)
Many cases illustrate the point, including Greenberg v. Western Turf Assn. (1903) 140 Cal. 357 [73 P. 1050], where the Supreme Court authorized both punitive damages under
Marshall v. Brown (1983) 141 Cal.App.3d 408 [190 Cal.Rptr. 392], is similar. There, the court stated that “[b]oth plaintiff and defendants concur on appeal that statutory damages and punitive damages arising out of the same cause of action are not mutually exclusive. ‘The fact that such a statutory penalty [treble damages] ... is imposed for a particular wrongful act does not preclude recovery of punitive damages in a tort action where the necessary malice or oppression is shown....‘” (Id. at p. 418.)
In sum, statutory damages awarded as a penalty are “distinguished” from punitive damages. And recovery of both is “permitted.”
That double damages under
The proof required to recover punitive damages requires that the plaintiff provide evidence of the defendant‘s net worth. (Baxter v. Peterson (2007) 150 Cal.App.4th 673, 679 [58 Cal.Rptr.3d 686]; Kelly v. Haag (2006) 145 Cal.App.4th 910, 916 [52 Cal.Rptr.3d 126].)
As quoted above,
And to the extent the alternative bases of recovery under
The most frequent application of “bad faith” is in insurance cases, the concept based on a tortious breach of the covenant of good faith and fair dealing. (See generally Chateau Chamberay Homeowners Assn. v. Associated Internat. Ins. Co. (2001) 90 Cal.App.4th 335, 345 [108 Cal.Rptr.2d 776].) And in the insurance context, bad faith and punitive damages are not coextensive, as held in Silberg v. California Life Ins. Co. (1974) 11 Cal.3d 452, 462-463 [113 Cal.Rptr. 711, 521 P.2d 1103], where the Supreme Court was careful to point out that an insurer‘s breach of the implied covenant of good faith-that is, bad faith-did not automatically justify an award of punitive damages. Rather, a separate showing of “oppression, fraud or malice” within the meaning of
Finally, and not incidentally,
Jahns, the old Supreme Court case relied on by petitioners, lends support to our conclusion. Jahns involved application of former section 116 of the 1851 Act to Regulate the Settlement of the Estates of Deceased Persons (Probate Act), which provided as follows: “If any person before the granting of letters testamentary or of administration shall embezzle or alienate any of the moneys, goods, chattels, or effects of any deceased person, he shall stand chargeable and be liable to the action of the executor or administrator of the estate, for double the value of the property so embezzled or alienated, to be recovered for the benefit of the estate.” The issue in Jahns was whether former section 116 of the Probate Act provided a basis for the administrator‘s
The trial court found that the defendant did not “‘embezzle or alienate and convert to his own use.‘” (Jahns, supra, 29 Cal. at p. 509.) The plaintiff took exception to the finding on the ground, among others, that the defendant took and carried away the property. The court rejected the plaintiff‘s position, and the plaintiff moved for a new trial, which was denied. In the Supreme Court‘s words: “In denying the plaintiff‘s motion for a new trial, the Court was of the opinion that the action was for embezzlement, and was brought under section one hundred and sixteen of the Probate Act, which alone gave the plaintiff a remedy for the alleged wrong, and that under the allegations of the complaint, the plaintiff was not entitled to recover for the wrongful conversion, as in the action of trover at common law-that he must prove the embezzlement or fail in the action. The counsel for the defendant holds to the same views, and offers as a further reason why the plaintiff could not recover, as in trover, upon the complaint in the cause, that the action given by section one hundred and sixteen is a penal action.” (Jahns, supra, 29 Cal. at p. 510.)
The Supreme Court reversed, holding that a statute is penal if it “imposes a penalty, or creates a forfeiture as the punishment for the neglect of some duty, or the commission of some wrong, that concerns the good of the public, and is commanded or prohibited by law.” (Jahns, supra, 29 Cal. at p. 512.) The court explained that a statute that does not create any new rights of action or remedies but simply enhances the damages is remedial-and that former section 116 of the Probate Act was a remedial, not punitive, statute. (Jahns, at p. 513.) We perceive no meaningful difference between the language used in
Real party in interest‘s return asserts that “[t]he First District has long held that the enhanced remedies for cutting and removing timber provided for section [sic]
Real Party in interest‘s assertions are more than slightly misleading. While Drewry on occasion used the word “punitive,” it also used other words, like “remedial” and “penal.” (Drewry, supra, 236 Cal.App.2d at p. 172.) Hassoldt is not a First District case. And neither Young nor Kraus holds that
Young will be discussed in detail below. And the actual language of Kraus-the case from which real party in interest apparently gets all his cited authorities save Young-is this: ”
Punitive in nature, Kraus said. Not punitive damages. Kraus does not support real party in interest. To the contrary, Kraus supports our conclusion here.
In Kraus, the decedent‘s brother David had acted in bad faith, and the trial court awarded double damages against him. (Kraus, supra, 184 Cal.App.4th at pp. 115-116.) On appeal, David made several arguments in which he referred to the award against him as “‘exemplary damages‘” or “‘punitive damages.‘” (Id. at p. 116.) The Court of Appeal rejected all of David‘s arguments, ending its discussion with this: “David generally mischaracterizes this case as involving an award of actual and exemplary damages to a nonparty. But the probate court did not award damages. It ordered David to hand over misappropriated funds together with a statutory penalty for his bad faith conduct.”
...
“David further asserts the ‘punitive damage award’ must be reversed because the amount of ‘actual or compensatory damages’ awarded to the beneficiaries (zero) bore no rational relation to the ‘punitive damages’ ($394,804). This argument proceeds from a misdescription of the underlying facts. No actual or compensatory damages were awarded to anyone....
In short, Kraus makes two points noted above:
Young, too, has no holding favorable to real party in interest. Young was a
Setting the stage for that discussion, the Court of Appeal began its discussion with language demonstrating that
Nowhere, we note, does the Court of Appeal say that punitive damages and double damages are the same. Or duplicative.
The Court of Appeal then went on for 10 pages discussing the proceedings below, and the statutory scheme of
“[P]unitive in nature.” (Young, supra, 160 Cal.App.4th at p. 91.) “[P]unitive effect.” (Id. at p. 90.) Maybe. But not punitive damages. Whatever the observations about “punitive,” they were just that-observations. They were dicta. Young merely concluded that there should have been a bifurcation of the liability and damages phases because it would save the estate from incurring the costs of appraisals before prevailing on the liability issue. Whether the double damages were remedial or punitive was irrelevant to the holding.
DISPOSITION
Let a peremptory writ of mandate issue commanding respondent court to set aside its order granting real party in interest‘s motion for summary adjudication and to enter an order denying the motion. Petitioners shall recover costs.
Kline, P. J., and Stewart, J., concurred.
On February 25, 2016, the opinion was modified to read as printed above.