Lane v. Bell ( 2018 )

Filed 1/31/18
CERTIFIED FOR PARTIAL PUBLICATION*
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
JOHN LANE et al., D071312
Plaintiffs and Appellants,
v. (Super. Ct. No.
37-2013-00034878-CU-MC-CTL)
JOAN BELL et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of San Diego County,
Gregory W. Pollack, Judge. Affirmed.
Veta & Veta and Ross Evan Veta for Plaintiffs and Appellants.
Suppa, Trucchi, and Henein and Samy S. Henein for Defendants and Respondents.
To prevail in a malicious prosecution action under California law, a malicious
prosecution plaintiff (the defendant in the underlying action) must show that (1) the
plaintiff in the underlying action pursued a claim with subjective malice, (2) the claim
was brought without objective probable cause, and (3) the underlying action was
terminated on the merits in favor of the defendant. The issue in this case is a seemingly
* Pursuant to California Rules of Court, rule 8.1110, this opinion is certified for
publication with the exception of part B of the Discussion.
simple one. The plaintiff in the underlying action brought multiple claims and lost many,
perhaps most of them, but prevailed on at least one. Can the defendant bring a malicious
prosecution action by showing that some of the claims were malicious and lacked
probable cause, but without showing a "favorable termination" of the entire underlying
action?
In many respects, the answer likewise appears simple. In its most recent
discussion of the issue, the California Supreme Court emphasized that "lack of probable
cause" and "favorable termination" were distinct requirements in a malicious prosecution
action: " '[T]hat a malicious prosecution suit may be maintained where only one of
several claims in the prior action lacked probable cause [citation] does not alter the rule
there must first be a favorable termination of the entire action.' " (Crowley v. Katleman
(1994) 8 Cal.4th 666, 686 (Crowley).) Thus, if the defendant in the underlying action
prevails on all of the plaintiff's claims, he or she may successfully sue for malicious
prosecution if any one of those claims was subjectively malicious and objectively
unreasonable. But if the underlying plaintiff succeeds on any of his or her claims, the
favorable termination requirement is unsatisfied and the malicious prosecution action
cannot be maintained.
In this case, John and Denise Lane jointly owned a piece of rural property together
with Denise's mother, Joan Bell. In 2011, the Lanes filed a lawsuit (the property action)
against Bell arising out of disputes over the property. (See Lane v. Bell (Jan. 8, 2015,
D064651) __Cal.App.5th__ [2015 Cal.App. Unpub. Lexis 78] (Lane I).) Bell cross-
complained, seeking among other things a declaration of the extent of her interest in the
2
property and an order for partition. The Lanes prevailed on most of Bell's claims, but a
judgment was ultimately entered in Bell's favor valuing her interest in the property and
granting her claim for partition. Because Bell prevailed on at least one of her claims, the
seemingly simple answer—the conclusion reached by the trial court—is that the Lanes
cannot demonstrate a "favorable termination" of the underlying action, which is fatal to
their malicious prosecution action.
What appears to be simple becomes more complicated because the Crowley
discussion is technically dicta; in Crowley there was no question that the underlying
action in its entirety had terminated favorably to the defendant. (Crowley, supra,
8 Cal.4th at p. 676.) Further muddying the waters is a 60-year-old Supreme Court
opinion relied on heavily by the Lanes—Albertson v. Raboff (1956) 46 Cal.2d 375(Albertson)—which seems to hold that, at least in certain cases, a malicious prosecution
plaintiff can satisfy the "favorable termination" element by succeeding on some causes of
action in the underlying case, even though a partial judgment was entered against him or
her on a different claim. (Id. at p. 382.) The Lanes thus suggest we should decline to
apply the dicta of Crowley in favor of their reading of Albertson's holding.
To do so, however, would require that we ignore two relatively recent decisions by
this court that follow Crowley on this very point, albeit without recognizing the potential
conflict with Albertson. More importantly, the rule urged by the Lanes would conflate
two separate elements in a malicious prosecution claim, effectively eliminating any
requirement that the entire underlying action terminate in the defendant's favor.
3
In the absence of further guidance from the Supreme Court, we believe Crowley
correctly addresses the issue, and the trial court properly relied on Crowley in granting
summary judgment. Accordingly, we affirm.
FACTUAL AND PROCEDURAL BACKGROUND
1. The Underlying Dispute and the Property Action
In 1987, John Lane acquired the property and ultimately conveyed an undivided
one-half interest to Bell. Concurrently with that transfer, the Lanes and Bell entered into
a Joint Venture Agreement (JVA) defining the parties' anticipated rights and
responsibilities. Under the JVA, the parties would seek approval for a lot split which, if
successful, would leave Bell with the upper lot and the Lanes with the lower lot. The
Lanes were responsible for processing the lot split application, and the parties would
equally divide the associated costs and common expenses for the land. The parties also
agreed that if the lot split was denied, each would have a right of first refusal to purchase
the other's interest in the land.
Bell moved onto the upper lot in 1989 and lived on the land in a recreational
vehicle through 2010. Although they did everything required of them under the JVA, the
Lanes were ultimately unable to accomplish a lot split because of intervening legislation.
They also failed to obtain county approval for a "granny flat" for Bell—with a separate
kitchen—attached to the vacation home they were preparing to build on the property.
Shortly thereafter, Bell sought the help of a friend, Jerry Michael Suppa, who was
of counsel to a law firm that ultimately represented Bell in the property action. Suppa
told John Lane that Bell was entitled to the house and wanted a quarter of a million
4
dollars. He threatened Lane with elder abuse charges and financial ruin if he did not
capitulate.
Meanwhile, based on a revised set of plans, the Lanes began construction of a
home without a granny flat. By late October 2010, the residence had been sufficiently
completed to permit the Lanes to obtain a certificate of occupancy. During this same
period, the parties negotiated a buy-out agreement under which they would dissolve the
JVA, hire an appraiser to value the land, and have the Lanes purchase Bell's interest.
When negotiations on the buy-out stalled, the Lanes filed the property action against Bell.
They alleged claims for breach of contract, negligent misrepresentation, breach of the
promissory note, and three causes of action seeking to quiet their title as against Bell's
claims. In response, Bell filed her cross-complaint, upon which the Lanes' current action
for malicious prosecution is predicated, which alleged claims for breach of contract,
violation of the implied covenant of good faith, elder abuse, fraud, intentional infliction
of emotional distress, and declaratory relief/partition.
At trial in the property action, the claims raised by Bell's cross-complaint against
the Lanes resulted in a judgment granting some of the relief sought by Bell. On Bell's
claim for declaratory relief/partition, the court concluded that Bell and the Lanes each
had an interest in the property; it valued Bell's gross share in the property at $177,500 and
the Lanes' gross share at $382,500. Granting Bell's claim for partition, the court
5
determined her net share1 to be $44,787, and ordered that the Lanes had the right to
acquire Bell's interest in the property upon payment to her of that amount. The Lanes
prevailed on all of the remaining claims in Bell's cross-complaint, including her causes of
action for elder abuse and intentional infliction of emotional distress.2
2. The Malicious Prosecution Action
Following judgment in the property action, the Lanes filed this action for
malicious prosecution based on the portion of Bell's cross-complaint that asserted claims
for elder abuse and intentional infliction of emotional distress. Bell initially defended by
moving to strike the complaint pursuant to the anti-SLAPP (Strategic Lawsuit Against
Public Participation) statute (Code Civ. Proc., § 425.16), but the trial court denied the
motion and this court in Lane I affirmed that order on appeal. Bell thereafter moved for
summary judgment, asserting (among other things) that under the rationale of this court's
decision in StaffPro, Inc. v. Elite Show Services, Inc. (2006) 136 Cal.App.4th 1392(StaffPro) the Lanes could not demonstrate the "favorable termination" element for a
malicious prosecution claim. In this regard, Bell contended the Lanes were required to
1 The court's judgment calculated Bell's net share by subtracting from Bell's share
(1) the $25,000 already paid to Bell by the Lanes, and (2) the amount owed by Bell to the
Lanes under the jury's award of $40,753.80 on the Lanes' cause of action against Bell for
breach of the JVA. It rejected the Lanes' remaining equitable causes of action against
Bell insofar as they sought to declare void the deed which granted Bell an interest in the
property and to cancel that deed.
2 Bell's claims of elder abuse and intentional infliction of emotional distress were
resolved when the court granted the Lanes' nonsuit motion. Bell's remaining claims
against the Lanes (for fraud, breach of contract, and breach of the implied covenant of
good faith and fair dealing) were resolved against Bell by the jury's special verdict on
those claims.
6
show they prevailed on all—and not just some—of the claims asserted against them.
Because Bell prevailed on her causes of action for declaratory relief and partition, she
urged that the property action did not terminate in favor of the Lanes. Opposing the
motion, the Lanes argued it was sufficient that they prevailed on a discreet portion of the
underlying action.3
The trial court granted Bell's motion for summary judgment. It noted that the
judgment in the property action showed Bell prevailed on part of her cross-complaint (as
well as on many claims interposed by the Lanes' complaint). Under StaffPro, Bell's
partial success precluded the Lanes from establishing "favorable termination" of the
underlying action.
3 Although the Lanes conceded below that Supreme Court cases including Crowley,
supra, 8 Cal.4th 666 and Casa Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336 (Casa
Herrera) required assessment of the "favorable termination" element by examining the
judgment as a whole, their opposition contained no analysis of StaffPro.
7
DISCUSSION
A claim for malicious prosecution requires that the plaintiff demonstrate (1) the
defendant brought (or continued to pursue) a claim in the underlying action without
objective probable cause, (2) the claim was pursued by the defendant with subjective
malice, and (3) the underlying action was ultimately resolved in the plaintiff's favor.
(Sycamore Ridge Apartments, LLC v. Naumann (2007) 157 Cal.App.4th 1385, 1398.) A
plaintiff must establish all three elements. (Sheldon Appel Co. v. Albert & Oliker (1989)
47 Cal.3d 863, 871–872 (Sheldon Appel).) If the defendant's summary judgment motion
conclusively negates any one of the elements, the motion is properly granted. (Tool
Research & Engineering Corp. v. Henigson (1975) 46 Cal.App.3d 675, 678, disapproved
on other grounds in Sheldon Appel, at p. 883, fn. 9.) Here, the trial court granted Bell's
motion for summary judgment because it determined that the judgment in the underlying
action precluded the Lanes from establishing "favorable termination" of that action.
A. Favorable Termination
"Favorable termination . . . is an essential element of the tort of malicious
prosecution, and it is strictly enforced." (Ferreira v. Gray, Cary, Ware & Freidenrich
(2001) 87 Cal.App.4th 409, 413.) Noting that " 'the theory underlying the requirement of
favorable termination is that it tends to indicate the innocence of the accused,' " the
Supreme Court in Casa Herrera expressly stated that "[t]o determine 'whether there was
a favorable termination,' we 'look at the judgment as a whole in the prior action.' " (Casa
Herrera, supra, 32 Cal.4th at p. 341, italics added.) The basic question presented here is
whether a partial victory by the malicious prosecution plaintiff in the underlying action
8
can satisfy the favorable termination element where the malicious prosecution defendant
also obtained a partial victory in the underlying action.
As previously noted, this issue is framed by two Supreme Court cases decided
nearly 40 years apart—Crowley, supra, 8 Cal.4th 666 and Albertson, supra, 46 Cal.2d
375. Yet even before Albertson was decided in 1956, it was well settled that the
"favorable termination" element in a malicious prosecution action required an assessment
of the judgment as a whole in the prior action. In Murdock v. Gerth (1944) 65
Cal.App.2d 170 (Murdock), the underlying plaintiff (Wolf) sued the underlying defendant
(Murdock) to collect the entire balance due on the original contract, which assertedly
obligated Murdock to purchase a business. Murdock claimed the original contract had
been superseded by a later agreement placing more limited obligations on him. The
judgment in the underlying action found in favor of Murdock as to Wolf's claim on the
original contract, but awarded Wolf a small recovery against Murdock for the unpaid
amount due under the later superseding agreement. Murdock then sued Wolf's attorney
for maliciously prosecuting the underlying claim on the original contract, and the trial
court found for Murdock on his malicious prosecution claim. (Id. at pp. 174–177.) The
appellate court reversed the judgment based in part on its conclusion that the favorable
termination element was absent. It explained that "in determining whether a proceeding
alleged to have been maliciously prosecuted has been terminated in favor of the party
injured by such proceeding, consideration should be given to the judgment as a whole."
(Id. at p. 177.) It is the "judgment itself" in the prior action that is "the criterion by which
to determine who was the successful party in such proceeding." (Ibid.) Because the
9
judgment as a whole showed the underlying plaintiff had been awarded a partial
recovery, even though it was "[t]rue [the recovery] was only a small part of the amount
sued for," the action did not terminate in favor of the defendant. (Ibid.)
Decided 12 years after Murdock, Albertson's discussion of the favorable
termination requirement arose in an unusual context. The underlying action filed by
Raboff against Albertson pleaded two claims. Raboff sought (1) a money judgment on a
debt owed to him, and (2) a lien on real property allegedly pledged by the original debtor
to secure the debt or, in the alternative, a declaration that the transfer of the property by
the original debtor to Albertson was a transfer in fraud of creditors. Raboff filed a lis
pendens in connection with the latter claims. Although Raboff prevailed on the first
claim to collect on the debt, Albertson defeated the lien claim and subsequently sued
Raboff alleging disparagement of title based on the recording of the lis pendens.
(Albertson, supra, 46 Cal.2d at pp. 377–378.) The Supreme Court's principal concerns
were: (1) whether Albertson's complaint alleging disparagement of title based on the
recording of a lis pendens could properly plead a claim based on an act that was subject
to the absolute privilege under Civil Code section 47 (id. at pp. 378–382); and (2) if not,
could the complaint nevertheless be construed as asserting a claim for malicious
prosecution, which is not subject to the absolute privilege (id. at pp. 382–385).
Before addressing those issues, the court first considered Raboff's argument that
Albertson's malicious prosecution complaint was premature because, at the time it was
filed, there was still an appeal pending from the underlying judgment. Albertson rejected
that argument because the appeal challenged only the money judgment in favor of
10
Raboff. "That part of the judgment was severable from the part that determined that
[Raboff] had no interest in or right to a lien upon plaintiff's real property. No appeal was
taken from the latter part of the judgment, and it became final. . . . [Citations.] Plaintiff's
complaint herein was filed after the time for appeal had expired and was therefore not
premature." (Albertson, supra, 46 Cal.2d at p. 378.)
Having disposed of the preliminary matter, Albertson turned to the two principal
questions in the case. As to the first, the court concluded that the pleaded claim
(disparagement of title based on the lis pendens) was subject to the absolute privilege.
The opinion then examined whether the complaint, although not stating a valid
disparagement of title claim, might nonetheless adequately allege the elements of a
malicious prosecution claim. Although the court's malicious prosecution discussion
extensively examined the "probable cause" and "malice" elements, its sole evaluation of
the "favorable termination" element was its peremptory statement that "[a]s indicated
above, that part of the judgment in the former action that determined that [Raboff] had no
interest in or a right to a lien upon [Albertson's] real property is now final and constitutes
a termination of that separable part of the proceeding favorable to [Albertson]."
(Albertson, supra, 46 Cal.2d at p. 382, italics added.) Thus, while Albertson involved a
malicious prosecution claim in which the underlying defendant was only partly
successful, its "severability rule" contained no discussion or disapproval of the general
principal that the favorable termination assessment requires "consideration [] be given to
the judgment as a whole." (Murdock, supra, 65 Cal.App.2d at p. 177.) It was instead
derived from the court's earlier analysis of whether the judgment on a cause of action
11
from which no cross-appeal had been filed was a final judgment for purposes of a
malicious prosecution action.
Roughly 20 years later, Albertson was relied on by the Supreme Court for its
discussion of the probable cause requirement. In Bertero v. National General
Corp. (1974) 13 Cal.3d 43 (Bertero), the court reaffirmed and extended Albertson's
holding in concluding it is sufficient if a malicious prosecution plaintiff can establish that
one of multiple theories in the underlying action was objectively unreasonable. (Id.
at p. 57.) Bertero presented no issue as to favorable termination because the entire
underlying action was resolved in favor of the malicious prosecution plaintiff.
The Supreme Court considered the favorable termination requirement again in
Crowley, supra, 8 Cal.4th 666. In the intervening 40 years between Albertson and
Crowley, two distinct lines of cases had developed in the Court of Appeal. One
continued to follow the Murdock rule that the favorable termination requirement applies
to the underlying plaintiff's claims in their collective entirety. Under this rule, it is not
sufficient that the defendant in the underlying action prevailed on some or most of the
claims. (See Freidberg v. Cox (1987) 197 Cal.App.3d 381, 387 (Freidberg); Jenkins v.
Pope (1990) 217 Cal.App.3d 1292, 1298–1300 (Jenkins).) But another line of cases read
Albertson as creating a new rule that would allow a malicious prosecution action for a
partially successful underlying defendant so long as the claims on which the defendant
prevailed were "severable." (See Paramount General Hospital Co. v. Jay (1989) 213
Cal.App.3d 360, 368–370 (Paramount General); Tabaz v. Cal Fed Finance (1994) 27
Cal.App.4th 789, 792–794 (Tabaz).)
12
Crowley addressed the distinct issue of whether, for purposes of determining the
lack of probable cause element, each theory asserted in the underlying action must be
separately supported by probable cause or whether the existence of probable cause for
any of the underlying claims bars a later action for malicious prosecution. The
underlying plaintiff (Katleman) filed a will contest against Crowley seeking to invalidate
a will favoring him. Katleman's complaint alleged six different grounds (including undue
influence by Crowley) to contest the will; the probate court ultimately rejected all six
challenges. (Crowley, supra, 8 Cal.4th at pp. 673–674.) In Crowley's subsequent
malicious prosecution action against Katleman, he asserted that five of the six grounds
(i.e., every ground except undue influence) were prosecuted maliciously and without
probable cause. The Crowley court rejected Katleman's argument that the malicious
prosecution action was properly dismissed because one of her theories (undue influence)
was supported by probable cause. Reaffirming its previous ruling in Bertero, supra,
13 Cal.3d 43, the Supreme Court concluded that on the probable cause element issue
" 'a malicious prosecution suit may be maintained where only one of several claims in the
prior action lacked probable cause.' " (Crowley, supra, at p. 686.)
In Crowley, the underlying plaintiff recovered nothing on any claim. Thus, the
court was not directly presented with the issue of whether a partial recovery by the
underlying plaintiff would be fatal to a showing of the favorable termination element in
the subsequent malicious prosecution action. However, the Supreme Court's opinion is
hardly silent on the issue. Katleman sought to rely on Freidberg, supra, 197 Cal.App.3d
381—a favorable termination case—to buttress her argument that probable cause for any
13
one theory supporting a single primary right should bar a subsequent malicious
prosecution action. (Crowley, supra, 8 Cal.App.4th at pp. 683–684.) In rejecting
Katleman's attempt to export Freidberg's "favorable termination" analysis into the
"probable cause" arena, Crowley stated that the only issue in the Freidberg case "was
whether the [underlying] action had terminated favorably to Freidberg, as required to
support a malicious prosecution claim. [Citation.] The issue was not difficult: on its face
the action had evidently not terminated favorably to Freidberg, because the judgment
assessed substantial damages against him." (Id. at p. 684.)
The Supreme Court dismissed the argument that if some recovery in the
underlying proceeding bars a later malicious prosecution action then some probable
cause in the underlying proceeding (even without any recovery) should also bar a later
malicious prosecution:
"Freidberg was not a probable cause case but a favorable
termination case. Prior opinions have stressed that the two elements
of the tort serve different purposes: '[Plaintiff] confuses the
elements of probable cause and favorable termination. Whether a
prior action was legally tenable goes to the issue of probable cause,
that is, did the defendant have an honest and reasonable belief in the
truth of the allegations. [Citation.] Whether a prior action was
terminated favorably tends to show the innocence of the defendant in
the prior action [citations], and is not affected by the objective
tenability of the claim. In short, these two elements of the malicious
prosecution tort serve different purposes, and the legal tenability of
the underlying action is not the standard by which to judge whether
the action was terminated in [plaintiff's] favor.' " (Crowley, supra,8 Cal.4th at p. 686, quoting Warren v. Wasserman, Comden &
Casselman (1990) 220 Cal.App.3d 1297, 1303.)
Crowley then quotes with approval from the Court of Appeal decision in Jenkins, supra,
217 Cal.App.3d at p. 1300: " '[T]he Supreme Court's [Bertero] holding that a malicious
14
prosecution suit may be maintained where only one of several claims in the prior action
lacked probable cause (Bertero [], supra, 13 Cal.3d at pp. 55–57) does not alter the rule
there must first be a favorable termination of the entire action. (Freidberg [], supra, 197
Cal.App.3d at pp. 386–387.) In Bertero, the question whether all or only part of the prior
action had to be without probable cause arose only after judgment had been reached in
the plaintiff's favor in the prior action as a whole.' " (Crowley, at p. 686.)
Crowley did advert to cryptic language in Albertson from which the Paramount
General/Tabaz line of cases emerged, but only in the context of indicating how Freidberg
unnecessarily strayed when it employed the "primary right theory . . . in order to
distinguish [Albertson], [because] Albertson was distinguishable on other grounds."
(Crowley, supra, 8 Cal.4th at p. 685.) Crowley explained that the discussion in Albertson
regarding severability was primarily directed at rejecting the contention that the
malicious prosecution complaint was premature because an appeal was still pending. But
the court acknowledged what it characterized as a "holding" in Albertson that the
malicious prosecution complaint in that case met the favorable termination requirement:
"[W]e said simply that 'As indicated above, that part of the judgment in the former action
that determined that defendant had no interest in or a right to a lien upon plaintiff's real
property is now final and constitutes a termination of that separable part of the
proceeding favorable to plaintiff.' ([Albertson, supra, 46 Cal.2d at p. 382.]) Because
there was no such partial appeal from the judgment in Freidberg, the Freidberg court
could have distinguished Albertson on that ground alone." (Crowley, at p. 685.)
15
Since Crowley was decided, this court on two occasions has discussed the
favorable termination requirement in the context of an underlying defendant's partial
success. In both cases, we relied on Crowley in concluding that the entire action must
terminate in the defendant's favor in order to support a later claim for malicious
prosecution.
In Dalany v. American Pacific Holding Corporation, 42 Cal.App.4th 822(Dalany), we examined whether the favorable termination element had been satisfied
when the underlying cross-defendant (Dalany) had prevailed (by obtaining summary
adjudication in his favor) on some but not all of the underlying claims asserted against
him by the underlying cross-complainant, American Pacific Holding Corporation
(APHC). While Dalany prevailed on some claims, the remainder of the underlying
claims asserted by APHC's cross-complaint (together with Dalany's affirmative claims
against APHC) were disposed of by a global settlement. Dalany subsequently sued
APHC for maliciously prosecuting its cross-complaint against him. (Id. at pp. 825–826.)
Noting that settlement of the remaining claims precluded Dalany from showing the
"favorable termination" element as to those claims, this court dismissed Dalany's
argument that he could sue for malicious prosecution of those claims upon which he
prevailed by summary adjudication. (Id. at pp. 827–828.) Relying on Crowley but
without discussing Albertson, we "reject[ed] Dalany's suggestion that his success in
achieving summary adjudication as to some of the causes of action in the cross-complaint
prior to entry of the stipulated judgment gave rise to a favorable termination. . . . The
Supreme Court has recently emphasized that although for purposes of determining
16
probable cause each theory asserted in a prior action must be separately considered,
separate consideration of prior theories of claims is not appropriate with respect to the
element of favorable termination." (Dalany, supra, at p. 829, citing Crowley, supra, 8
Cal.4th at p. 686.)
In StaffPro, supra, 136 Cal.App.4th 1392, this court was confronted with and
required to resolve the tension between the Tabaz/Paramount General line of cases
(which applied "a severability analysis to determine the favorable termination element")
and the contrary authority, represented by such cases as Crowley, Freidberg, and Jenkins
(which suggested that the underlying defendant needed to prevail on the entire underlying
action in order to establish favorable termination). (StaffPro, at pp. 1394, 1402–1404.)
In StaffPro, the underlying action by the plaintiff (Elite) alleged three causes of action
against StaffPro: unfair business practices (Bus. & Prof. Code, § 17200), offering below-
cost services (id., § 17043), and intentional interference with prospective business
advantage by improperly underbidding Elite on a number of specifically enumerated
contracts. (StaffPro, at p. 1395.) Elite dismissed the third claim prior to trial and, at trial,
the court granted StaffPro's motion for judgment under Code of Civil Procedure section
631.8, subdivision (a) as to the second cause of action. However, Elite prevailed on its
first claim and obtained injunctive relief. (StaffPro, at p. 1396.) StaffPro then filed a
malicious prosecution action, claiming that its partial victory in the underlying action
satisfied the favorable termination element. It argued that "the favorable termination
element of the malicious prosecution tort must be determined with respect to each
'severable' cause of action, and that Elite's second and third causes of action, which
17
terminated in StaffPro's favor, are severable from the first." (Id. at p. 1402.) The
StaffPro opinion, building on this court's earlier Dalany decision, rejected that argument
because, under Crowley, "a plaintiff in a malicious prosecution must establish ' "a
favorable termination of the entire [underlying] action." ' " (Id. at p. 1406.)4
Both StaffPro and Dalany construed Crowley's discussion as declaring that, while
the absence of probable cause element supports a malicious prosecution claim if any of
the underlying claims were prosecuted without probable cause, that analysis is only
conducted " 'after judgment had been reached in the plaintiff's favor in the prior action as
a whole.' " (Dalany, supra, 42 Cal.App.4th at pp. 829–830.) Thus, where the underlying
defendant did not prevail on every claim asserted in the underlying action, either because
the judgment awarded affirmative relief to the underlying plaintiff (as in StaffPro and this
case) or because some claims by the underlying plaintiff were resolved by a settlement
(as in Dalany), that " 'reflects ambiguously on the merits of the action . . . thus leaving
open the question of defendant's guilt or innocence.' " (Dalany, at p. 827, quoting Pender
v. Radin (1994) 23 Cal.App.4th 1807, 1814.) Both decisions explain that under Crowley,
the favorable termination cannot be shown and summary judgment in favor of the
defendant would be proper. (Dalany, at p. 830; StaffPro, supra, 136 Cal.App.4th at
pp. 1406–1408.) StaffPro takes the added step of expressly rejecting a severability
4 StaffPro acknowledged the favorable termination analysis in Crowley was
arguably dictum because it was not required for the decision in that case, but nevertheless
concluded the dictum "carries persuasive weight and should be followed where it
demonstrates a thorough analysis of the issue or reflects compelling logic." (StaffPro,
supra, 136 Cal.App.4th at p. 1403, fn. 9.)
18
analysis and concluding that Court of Appeal cases following that approach have been
abrogated sub silencio by Crowley. (StaffPro, at pp. 1402–1405 & fn. 11.)
What StaffPro did not confront directly was the potential conflict between the
logic of Crowley and the Supreme Court's earlier decision in Albertson. The Lanes argue
we should decline to follow StaffPro in favor of the binding precedent and more
"analogous" approach represented by Albertson.5 They contend that under Albertson, a
favorable result on "severable" claims can satisfy the favorable termination element
notwithstanding an unfavorable outcome on other claims resulting in an adverse
judgment.6
We are satisfied, however, that StaffPro correctly construed Crowley as requiring
that a malicious prosecution plaintiff show "there [was] a favorable termination of the
5 The Lanes assert the more "analogous" case of Albertson "was specifically
approved by StaffPro" and therefore implicitly argue that Albertson's severability analysis
can coexist with StaffPro's analysis of the favorable termination requirement. However,
the Lanes do not identify where the StaffPro court "specifically approved" Albertson, nor
can we find any reference to Albertson in StaffPro. Nor can the Lanes reconcile their
argument with StaffPro's express recognition that the "severability analysis is improper in
determining whether a malicious prosecution plaintiff has demonstrated favorable
termination of an underlying lawsuit." (StaffPro, supra, 136 Cal.App.4th at p. 1405.)
6 The Lanes also cite a post-Crowley decision, Franklin Mint Company v. Manatt,
Phelps & Phillips, LLP (2010) 184 Cal.App.4th 313, 333 (Franklin Mint), where the
court stated that "[a] claim for malicious prosecution need not be addressed to an entire
lawsuit; it may . . . be based upon only some of the causes of action alleged in the
underlying lawsuit." However, in Franklin Mint the malicious prosecution plaintiff had
prevailed on all of the five claims asserted in the underlying lawsuit (id. at pp. 325–329),
but claimed in its malicious prosecution action that only two of those claims were
brought without probable cause. (Id. at p. 330.) Nothing in Franklin Mint suggested any
different approach than was approved in Crowley.
19
entire [underlying] action" in the plaintiff's favor (Jenkins, supra, 217 Cal.App.3d
at p. 1300), and that a partial recovery against the malicious prosecution plaintiff in the
underlying action is fatal to showing the favorable termination element. (Accord,
Murdock, supra, 65 Cal.App.2d at p. 177; Freidberg, supra, 197 Cal.App.3d at pp. 386–
387.) Any other rule would strip the "favorable termination" requirement of its
independent significance because any individual "claim" that lacks probable cause will
necessarily be terminated in the underlying defendant's favor.
Indeed, Crowley specifically approved Freidberg's conclusion there was no
favorable termination under the facts of Freidberg even though the underlying plaintiff in
that case did not prevail on his contract claim (which sought $43,000 plus punitive
damages) or on a tort claim (seeking a similar amount) and instead only partially
prevailed on a common count by obtaining a $12,900 recovery. (Freidberg, supra, 197
Cal.App.3d at pp. 383–384.) According to the Supreme Court, the favorable termination
issue in Freidberg "was not difficult: on its face the action had evidently not terminated
favorably to Freidberg, because the judgment assessed substantial damages against him."
(Crowley, supra, 8 Cal.4th at p. 684.) The issue in this case is no more difficult.
While Crowley's general discussion of the favorable termination element, as well
as its specific observations on the absence of favorable termination under the facts of
Freidberg, support StaffPro's construction of the favorable termination element, Crowley
did leave some vestigial uncertainty (which the Lanes seize upon in this appeal) by
failing to specifically disapprove Albertson's cryptic discussion of the favorable
termination requirement. (Albertson, supra, 46 Cal.2d at p. 382.) This is the language
20
from which Paramount General and Tabaz derived a so-called "severability rule" that
would allow prosecution of a malicious prosecution claim based on partial success in the
underlying action if the claims on which the defendant prevailed were in some sense
severable. (See Paramount General, supra, 213 Cal.App.3d at pp. 368–371; Tabaz,
supra, 27 Cal.App.4th at pp. 792–793.)
But Crowley itself makes clear that Albertson's comments on the favorable
termination requirement apply, at most, in situations where a partial appeal has created a
severable judgment. (8 Cal.4th at p. 685.) We have no partial appeal in this case. That is
enough for us to conclude that the underlying property action did not terminate favorably
to the Lanes.
And although Crowley did not expressly overrule Albertson in this respect, we
question if any part of the so-called "severability" analysis survives. A partially
unsuccessful defendant's ability to maintain an action for malicious prosecution should
not turn on the fortuity of whether both parties or only one party elect(s) to pursue an
appeal from the initial judgment. Crowley's overarching conclusion (as explained by
StaffPro) was that severable consideration of the issue of lack of probable cause " 'does
not alter the rule there must first be a favorable termination of the entire action [citing
Freidberg],' " (Crowley, supra, 8 Cal.4th at p. 686, quoting Jenkins, supra, 217
Cal.App.3d at p. 1300), which appears inherently inconsistent with Albertson's
"severability-for-purposes-of-favorable-termination" approach. In our view, the logic of
Crowley—if not its explicit language—has overruled this aspect of Albertson.
21
Because we are satisfied StaffPro properly construed Crowley, we agree with the
trial court that the Lanes cannot establish the essential element of favorable termination
because the entire underlying action was not terminated in the Lanes' favor. To the
contrary, the undisputed material facts showed the judgment granted some of the relief
sought by Bell in her cross-complaint. On Bell's claim for declaratory relief/partition, the
court determined (contrary to the Lanes' claims asserted in their complaint7) that Bell did
have an interest in the property and valued her gross share in the property at $177,500.
The court thus granted her claim for partition with an order that the Lanes had the right to
acquire her interest in the property upon payment to Bell of the net share of her interest in
the property. Under these circumstances, the Lanes cannot demonstrate the favorable
termination element because the single judgment on Bell's cross-complaint, while
partially in the Lanes' favor, was also partially in favor of Bell.
B. Law of the Case
The Lanes alternatively assert, for the first time on appeal that because this court
ruled in Lane I that Bell's anti-SLAPP motion directed at their malicious prosecution
7 The Lanes' complaint the property action included equitable causes seeking to
declare void the deed which granted Bell an interest in the property and to cancel that
deed. The court, having found for Bell on her declaratory relief cause of action,
necessarily rejected the Lanes' competing causes of action as part of its judgment.
22
complaint was properly denied, Lane I should be law of the case and should have
prevented entry of summary judgment against them.8
Law of the case is a doctrine of procedure founded upon the concepts of judicial
economy and finality of court rulings. (George Arakelian Farms, Inc. v. Agricultural
Labor Relations Board (1989) 49 Cal.3d 1279, 1281 (George Arakelian Farms); Searle
v. Allstate Life Ins. Co. (1985) 38 Cal.3d 425, 435.) Under the law-of-the-case doctrine,
where an appellate court states in its opinion a principle of law necessary to the decision,
that principle becomes law of the case and should be adhered to in all subsequent
proceedings in that case, including appeals. (People v. Stanley (1995) 10 Cal.4th 764,
786.) However, application of the rule is not invariable and is subject to a number of
qualifications, including when there has been an intervening change in the law (George
Arakelian Farms, at p. 1291) or where "the disputed issue was not presented or
considered in the proceedings below, or [] application of the doctrine would result in a
manifest injustice." (Ibid.; accord, People v. Shuey (1975) 13 Cal.3d 835, 842 [noting
application of law of the case requires " 'the point of law involved . . . must have been
actually presented and determined by the court, and . . . application of the doctrine will
not result in an unjust decision.' "].)
8 The Lanes also claim the opinion in Lane I is binding under res judicata principles.
However, res judicata requires, among other things, that a prior case involving the same
claim resulted in a final judgment on the merits. (See, e.g., Victa v. Merle Norman
Cosmetics, Inc. (1993) 19 Cal.App.4th 454, 459.) The Lanes cite nothing to suggest res
judicata principles have any application to an appellate disposition of an appeal or an
interim ruling in the same case, and we do not further consider that argument.
23
The Lanes assert that because this court in Lane I stated there was some evidence
from which a trier of fact could find the "favorable termination" element had been met,
that ruling was binding and precluded summary judgment here.9 Under some
circumstances, it might be appropriate to apply law of the case principles to a prior
appellate decision affirming denial of an anti-SLAPP motion when the same issues are
resurrected by a defendant's motion for summary judgment. (See, e.g., Bergman v. Drum
(2005) 129 Cal.App.4th 11, 18–19 [doctrine of law of the case precluded summary
judgment against plaintiff in malicious prosecution action where appellate court
previously ruled plaintiff presented prima facie case of malice and lack of probable cause
to defeat defendant's anti-SLAPP motion].) Here, however, the only issue "actually
presented and determined by the court" (People v. Shuey, supra, 13 Cal.3d at p. 842) was
the sufficiency of the Lanes' showing (in opposition to Bell's anti-SLAPP motion) on the
issues of lack of probable cause and malice. (Lane I, supra, 2015 Cal.App. Unpub. Lexis
78.) The "favorable termination" element was only cursorily acknowledged, in both the
Lanes' showing in opposition to the anti-SLAPP motion as well as in their appeal of the
ruling on that motion which resulted in Lane I. Indeed, the actual judgment in the
underlying action—which demonstrated that Bell achieved a partial recovery, thus
eliminating the favorable termination element on the Lanes' malicious prosecution
9 In Lane I, this court (in affirming the trial court's denial of Bell's anti-SLAPP
motion) synopsized the three elements required for a malicious prosecution action and
then stated that on the element of "Favorable Termination: the claims underlying the
[Lanes'] malicious prosecution action were Bell's claims for elder abuse . . . and for
intentional infliction of emotional distress. Each of those claims were dismissed by
nonsuit. Accordingly, the Lanes provided evidence that satisfied the first element."
24
claim—was not included in the appellants' appendix in Lane I. Nor did the appellate
briefs in Lane I anywhere mention (much less discuss the significance of) StaffPro or
Crowley or their impact on the Lanes' malicious prosecution action.10 Under these
circumstances, we conclude application of the law of the case doctrine is inappropriate
because "the disputed issue was not presented or considered in the proceedings below"
(George Arakelian Farms, supra, 49 Cal.3d at p. 1281) and, alternatively, "application of
the doctrine would result in a manifest injustice." (Ibid.)
10 The Lanes have moved that we take judicial notice of the Appellants' Opening
Brief and the Respondents' Brief filed in Lane I, and Bell has moved that we additionally
take judicial notice of the Appellants' Reply Brief filed in Lane I. On our own motion,
we take judicial notice of the entire file in Lane I, which "obviates the need to take
judicial notice of the documents appearing both in that file and in [their] request for
judicial notice." (ABF Capitol Corp. v. Grove Properties Co. (2005) 126 Cal.App.4th
204, 211–212, fn. 1.) The Lanes also ask that we take judicial notice of the "Points and
Authorities in Support of Defendant Joan Bell's Motion for Prevailing Party Status and
Attorney Fees and Costs" filed in San Diego Superior Court Case No. 37-2011-
00067396-CU-OR-EC. In light of our analysis, that document lacks relevance and we
therefore deny that aspect of the Lanes' request for judicial notice. (Davis v. Southern
California Edison Company (2015) 236 Cal.App.4th 619, 632, fn. 11.)
25
DISPOSITION
The judgment is affirmed. Respondents are entitled to costs on appeal.
DATO, J.
WE CONCUR:
BENKE, Acting P. J.
NARES, J.
26