City of Gardena v. State Water Resources Control Bd. CA4/3 ( 2021 )

Filed 9/22/21 City of Gardena v. State Water Resources Control Bd. CA4/3
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
CITY OF GARDENA,
Plaintiff and Respondent, G059466
v. (Super. Ct. No. 30-2016-00833722)
STATE WATER RESOURCES OPINION
CONTROL BOARD et al.,
Defendants and Appellants;
CITY OF WEST COVINA et al.,
Real Parties in Interest.
Appeal from a postjudgment order of the Superior Court of Orange County,
Glenda Sanders, Judge. Reversed.
Xavier Becerra and Rob Bonta, Attorneys General, Robert W. Byrne,
Assistant Attorney General, Gary E. Tavetian and Daniel M. Lucas, Deputy Attorneys
General, for Defendants and Appellants.
Casso & Sparks, John J. Harris; Locke Lord and Susan A. Kidwell for
Plaintiff and Respondent.
Jones & Mayer and Bruce A. Lindsay for Real Parties in Interest City of
West Covina, City of Santa Fe Springs, City of Lakewood, and City of Claremont.
Aleshire & Wynder, Christine M. Carson and Nicholas P. Dwyer for Real
Parties in Interest City of Carson, City of Rancho Palos Verdes, and City of Signal Hill.
No appearance for Real Party in Interest City of Baldwin Park.
* * *
INTRODUCTION
A regional water board issued a permit requiring municipal entities within
the region to reduce pollutants in their sewer systems. The state water board upheld this
permit. Two of the municipal entities affected by the permit, the City of Duarte (Duarte)
and the City of Gardena (Gardena), separately challenged it. After a bench trial, the court
entered judgment in favor of both Duarte and Gardena and issued separate writs of
mandate requiring the water boards to delete certain terms from the permit and to
reconsider it. The trial court then awarded Duarte, Gardena, and certain other cities that
had participated in the litigation their attorney fees pursuant to Code of Civil Procedure
section 1021.5 (section 1021.5). The water boards filed separate notices of appeal from
the judgments and the postjudgment orders awarding fees.
On the appeal from the judgment, this court reversed the judgment and
directed the trial court to deny the petition for writ of mandate. (City of Gardena v. State
Water Resources Control Board (Jan. 28, 2021, G058540) [nonpub. opn.].) The
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California Supreme Court denied Gardena’s petition for review.
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This court also reversed the judgment and directed the trial court to deny the petition
for writ of mandate in the Duarte case. (City of Duarte v. State Water Resources Control
Bd. (2021) 60 Cal.App.5th 258.) The California Supreme Court denied a petition for
review and a request for depublication of the opinion in that case.
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The appeal from the postjudgment order awarding attorney fees to Gardena
and certain real parties in interest is now before us. Despite the reversal of the judgment
originally in its favor, Gardena contends it is still the successful party. Normally, the
reversal of a judgment automatically requires reversal of an attendant attorney fees order.
Gardena nevertheless argues it is still the successful party because it achieved a
significant benefit for itself and other similarly situated municipal entities. We disagree
and reverse the postjudgment order awarding attorney fees.
STATEMENT OF FACTS AND PROCEDURAL HISTORY
The facts underlying the issuance of the permit, the litigation challenging
the permit, and the entry of judgment and issuance of a writ of mandate in favor of
Gardena are set forth in the companion appeal, Duarte v. State Water Resources Control
Board, appeal No. G059469.
After the judgment was entered in its favor, Gardena filed a motion for
attorney fees. Real parties in interest Rancho Palos Verdes, Signal Hill, and Carson filed
a separate motion for attorney fees, as did real parties in interest West Covina,
Lakewood, Santa Fe Springs, and Claremont, and real party in interest Baldwin Park.
The trial court awarded attorney fees to Gardena and the Real Parties in Interest as
follows:
Gardena: $1,094,613.50
West Covina: $91,280
Lakewood: $68,160
Santa Fe Springs: $68,920
Claremont: $13,360
Baldwin Park: $39,900
Carson: $15,120
Signal Hill: $23,560
Rancho Palos Verdes: $33,560
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The Water Control Boards appealed from the postjudgment order.
As in the companion case City of Duarte v. State Water Resources Control
Bd., supra, 60 Cal.App.5th 258, this court reversed the judgment and directed the trial
court to deny the petition for writ of mandate sought by Gardena. (City of Gardena v.
State Water Resources Control Board, supra, G058540.)
DISCUSSION
Section 1021.5, the private attorney general statute, “awards attorney fees
to a party whose action has resulted in the enforcement of an important right affecting the
public interest.” (Club Members for an Honest Election v. Sierra Club (2008) 45
Cal.4th 309, 318.) There are four prerequisites for eligibility under section 1021.5:
(1) the moving party’s action results in enforcement of “‘“an important right affecting the
public interest,”’” 2) the action confers a significant pecuniary or nonpecuniary benefit
on the general public or a large class of persons, (3) a private action by the moving party
was necessary to obtain the public benefit, and (4) the financial burden of the private
enforcement action makes it appropriate to award the moving party its attorney fees.
(Conservatorship of Whitley (2010) 50 Cal.4th 1206, 1214; Bui v. Nguyen (2014) 230
Cal.App.4th 1357, 1365.) The party moving for an award of attorney fees under section
1021.5 bears the burden of establishing each element of the statute. (Bui v. Nguyen,
supra, at p. 1365.)
I.
REVERSAL OF A JUDGMENT GENERALLY REQUIRES REVERSAL OF AN ATTORNEY FEES AWARD
In general, California law provides that if attorney fees are awarded under
section 1021.5 based on a party’s success in litigation, and that success is negated by a
reversal of the judgment, then the award of attorney fees must also be reversed. “A party
seeking an award of section 1021.5 attorney fees must ‘prevail’ or be ‘successful,’ which
generally involves obtaining a favorable judicial decision, i.e., a judicially sanctioned or
recognized change in the legal relationship of the parties. [Citations.] Fees are not
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barred if the case was won on a preliminary issue or if the parties settled before trial.
[Citation.] However, procedural success during the course of the litigation is insufficient
to justify such attorney fees where the ruling is later vacated or reversed on the merits.”
(Marine Forests Society v. California Coastal Com. (2008) 160 Cal.App.4th 867, 877,
italics added.)
Other opinions consistently state and apply this principle: “An order
awarding [attorney] fees [under section 1021.5] ‘falls with a reversal of the judgment on
which it is based.’” (California Grocers Assn. v. Bank of America (1994) 22
Cal.App.4th 205, 220; see Center for Biological Diversity v. County of San Bernardino
(2010) 188 Cal.App.4th 603, 613, fn. 4 [“even when there is no appeal of a postjudgment
order awarding attorney fees to the prevailing party, and the award has become final, the
appellate court’s reversal of the judgment on the merits extinguishes the order on fees”];
Klajic v. Castaic Lake Water Agency (2004) 121 Cal.App.4th 5, 16 [reversal of judgment
with directions to vacate writ of mandate means respondents were unsuccessful, and
reversal of attorney fee award under section 1201.5 is “automatic”]; Ryan v. California
Interscholastic Federation-San Diego Section (2001) 94 Cal.App.4th 1048, 1082
[“Because we reverse the judgment to the extent that Ryan prevailed, we must also
reverse the postjudgment order that followed awarding attorney fees and costs to his
counsel under section 1021.5”]; National Parks & Conservation Assn. v. County of
Riverside (2000) 81 Cal.App.4th 234, 238 [“where an appellate court reverses a judgment
ordering issuance of a writ of mandate, ‘[i]t follows’ that the trial court’s section 1021.5
attorney fees award must also be reversed”]; Kimble v. Board of Education (1987) 192
Cal.App.3d 1423, 1431, fn. omitted [“Under . . . section 1021.5, an award of attorney fees
is limited to the successful party”].)
Gardena has not cited, and we have not found in our own research, any case
that awards attorney fees to a party when the judgment in that party’s favor was reversed
in its entirety on appeal. This court’s reversal of the judgment with directions to deny the
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petition for writ of mandate and enter judgment for the Water Control Boards negated
Gardena’s initial success in the litigation.
II.
GARDENA IS NOT ENTITLED TO RECOVER ATTORNEY FEES UNDER SECTION 1021.5 ON THE
THEORY THAT IT ACHIEVED A SIGNIFICANT BENEFIT
Gardena argues that, notwithstanding the reversal of the judgment and the
writ of mandate, it is still the successful party within the meaning of section 1021.5
because it achieved a significant benefit as a result of the litigation. In its appellate
briefing, Gardena does not use the term “catalyst theory,” as does Duarte. At oral
argument, appellate counsel confirmed Gardena was not relying on the catalyst theory.
In Graham v. DaimlerChrysler Corp. (2004) 34 Cal.4th 553 (Graham), the
California Supreme Court held that a plaintiff may recover section 1021.5 attorney fees
“even when litigation does not result in a judicial resolution if the defendant changes its
behavior substantially because of, and in the manner sought by, the litigation.” (Graham,
supra, at p. 560.) To be entitled to such recovery (1) the plaintiff must have been a
catalyst to the defendant’s changed behavior, (2) the lawsuit must have “some merit,” and
(3) “the plaintiff must have engaged in a reasonable attempt to settle its dispute with the
defendant prior to litigation.” (Id. at pp. 560-561.)
A party need not obtain a final judgment in its favor in order to be the
successful party. (Graham, supra, 34 Cal.4th at pp. 565-566.) No case cited by Gardena,
however, would support an award of fees under section 1021.5 to Gardena or any of the
Real Parties in Interest as a successful party in this case, where the judgment in
Gardena’s favor was reversed in its entirety.
Gardena contends that it remains a successful party despite the reversal of
the judgment because it “obtain[ed] the enforcement of an important right affecting the
public interest and conferred a significant benefit not only on the City’s residents, but the
residents of all California cities and counties which operate a municipal separate storm
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water system subject to a NPDES permit issued by the Water Boards pursuant to their
authority under both the federal Clean Water Act and California’s Porter-Cologne Water
Quality Control Act. As a result of this litigation, it is now established that the Water
Boards must comply with State law, and in particular, Water Code § 13241 of the
Porter-Cologne Act, when they impose conditions and requirements in a MS4 NPDES
Permit that exceed the requirements of the federal Clean Water Act. Achieving that
objective warrants the affirmance of the award to Gardena of its attorney’s fees in this
case for the very reasons stated in the trial court’s order.” Gardena is incorrect.
The issues in the prior appeal were whether the permit required more than
federal law requires in terms of numeric effluent limitations and whether the Water
Control Boards sufficiently considered the economic considerations factor of Water Code
section 13241, subdivision (d). (Duarte, supra, 60 Cal.App.5th at p. 269; City of
Gardena v. State Water Resources Control Board, supra, G058540.) Whether the Water
Control Boards were required to comply with state law was not an issue in the case, as
the Water Control Boards never contended that they were not required to do so. The
issue was a factual one—whether the requirements of state law (in this case, the factors of
Water Code section 13241) were applicable, and whether the Water Control Boards
complied with them. We determined that the Water Control Boards had fully complied
with Water Code section 13241, and that we did not need to weigh in on the factual issue
of that section’s applicability. (Duarte, supra, at pp. 271-272; City of Gardena v. State
Water Resources Control Board, supra, G058540.)
In this case, Gardena’s lawsuit did not cause the Water Control Boards to
“change[ their] behavior substantially because of, and in the manner sought by, the
litigation.” (Graham, supra, 34 Cal.4th at p. 560.) To the contrary, this court determined
as a matter of law that the Water Control Boards had already performed the required cost
analysis under Water Code section 13241, subdivision (d). (Duarte, supra,
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60 Cal.App.5th at p. 274; City of Gardena v. State Water Resources Control Board,
supra, G058540.)
In none of the cases cited by Gardena in support of its significant benefit
theory were section 1021.5 attorney fees awarded to a party after the judgment, initially
in that party’s favor, was reversed in its entirety.
In Wal-Mart Real Estate Business Trust v. City Council of San Marcos
(2005) 132 Cal.App.4th 614, 618, San Marcos city residents Lori A. Drake and Randall
R. Walton submitted a referendum petition challenging the city’s general and specific
plan amendments that would have permitted the development of a Wal-Mart store.
Wal-Mart filed a petition for writ of mandate against the city, Drake, Walton, and others
seeking to invalidate the referendum petition. (Ibid.) The trial court denied Wal-Mart’s
petition on the ground the challenge was premature and entered judgment against
Wal-Mart. (Id. at p. 619.) The referendum succeeded, the city’s plan amendments were
defeated, and Wal-Mart brought no postelection challenge. (Ibid.) The court determined
that Drake and Walton were entitled to recover their attorney fees under section 1021.5
even though the trial court did not enter a judgment addressing the substantive merits of
Wal-Mart’s petition. (Wal-Mart Real Estate Business Trust v. City Council of
San Marcos, supra, at p. 617.)
In People v. Investco Management & Development LLC (2018)
22 Cal.App.5th 443, 448, individual investors specially appeared in a securities fraud
enforcement action and successfully opposed a motion that would have stayed all
individual actions against the investment company. The court concluded that the
investors were entitled to recover section 1021.5 attorney fees. (People v. Investco
Management & Development LLC, supra, at p. 471.)
In RiverWatch v. County of San Diego Dept. of Environmental Health
(2009) 175 Cal.App.4th 768, 771, the plaintiffs sought a writ of mandate against the
Department of Environmental Health in connection with the approval of a landfill.
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The trial court granted the petition in part and denied it in part, and the appellate court
affirmed. (Ibid.) The trial court awarded the plaintiffs attorney fees under
section 1021.5; the appellate court also affirmed that award on appeal. (RiverWatch v.
County of San Diego Dept. of Environmental Health, supra, at pp. 771-772.)
In Wallace v. Consumers Cooperative of Berkeley, Inc. (1985)
170 Cal.App.3d 836, 841, consumer interest groups challenged the validity of legislation
authorizing the Department of Food and Agriculture (the Department) to set minimum
retail milk prices. As a result of settlement negotiations, the parties agreed to continue
the trial to allow the Department to conduct public hearings on the issue. (Id. at
pp. 841-842.) Following the public hearings, the Department suspended the regulations
setting milk price minimums. (Id. at p. 842.) The trial court then awarded the consumer
interest groups attorney fees under section 1021.5 because they “‘set in motion the
machinery by which milk prices ultimately were suspended.’” (Wallace v. Consumers
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Cooperative of Berkeley, Inc., supra, at p. 842.)
None of these cases involves a party awarded attorney fees before the
judgment in its favor was reversed on appeal. In all of them, as detailed ante, the party
recovering attorney fees under section 1021.5 achieved a successful resolution of their
claims.
In light of our holding, we need not address the other issues raised in the
parties’ briefs, including but not limited to whether Gardena was acting primarily in its
own financial interest, and whether Gardena obtained a financial benefit as a result of the
litigation.
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Gardena also cites Graciano v. Robinson Ford Sales, Inc. (2006) 144 Cal.App.4th 140,
153, in which the prevailing party did not seek attorney fees under section 1021.5.
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DISPOSITION
The postjudgment order awarding attorney fees is reversed. Appellants to
recover costs on appeal.
FYBEL, J.
WE CONCUR:
O’LEARY, P. J.
ZELON, J.*
*Retired Justice of the Court of Appeal, Second Appellate District, assigned by the Chief
Justice pursuant to article VI, section 6 of the California Constitution.
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