Wednesday, September 4, 2002
Attorney Fee Lien Filing Protected by SLAPP Law—C.A.
By a MetNews Staff Writer
The filing of an attorney’s fee lien is a protected activity under the statute proscribing strategic lawsuits against public participation, the Third District Court of Appeal has ruled.
In an unpublished opinion by Justice Coleman Blease, the court Friday affirmed orders striking portions of a lawsuit against Sacramento attorneys Ronald Zumbrun and James Murphy and their law firms.
The suit grows out of a condemnation action filed by the Ventura County Flood
Control District in 1995 against the 67-acre Grubb Ranch.
Daniel and Johnnie Campbell, owners of a half-interest in the ranch, retained Zumbrun and his firm, Zumbrun & Findley. Zumbrun, the founder and former president of the Pacific Legal Foundation, left along with fellow PLF lawyer John Findley to start the firm—which specializes in property rights and other public law matters—10 years ago.
Zumbrun represented Campbell in the eminent domain action, filing a cross-complaint and petition for writ of mandate based on environmental law issues, and also in an action against the ranch’s co-owner, James Alger, for breach of a contract giving the Campbells the right to purchase his interest. A written agreement required the Campbells to pay legal fees at an hourly rate.
Daniel Campbell informed Zumbrun in December 1996 that he could no longer afford to pay his legal bills, and Zumbrun agreed to continue representing the Campbells on a contingency basis. But none of the proposed contingency agreements were signed because, Daniel Campbell told his lawyer, his bank found them unacceptable.
Campbell later admitted, according to the papers filed in support of the anti-SLAPP motion, that the “bank” was actually his wife.
The eminent domain case went to trial, and the Campbells were awarded $2.6 million plus $150,000 in attorney fees. They objected to Zumbrun’s fees, however, leading Zumbrun to serve a notice of lien and a request for non-binding arbitration proceeding as required by the State Bar Act.
The arbitrators awarded the full amount claimed as legal fees for the eminent domain case, the cross-complaint, and the Alger litigation, about $619,000. The Campbells rejected the arbitration award and filed a malpractice suit against the Zumbrun firm, which was transferred to Sacramento Superior Court.
Zumbrun retained Murphy, of Murphy, Pearson, Bradley & Feeney, who notified the Ventura County counsel of the attorney’s fee lien and demanded that the funds due the Campbells under the eminent domain award not be disbursed until the fee issues were resolved. Ventura County interpled the funds.
The Campbells filed a cross-complaint in the interpleader action, naming the Murphy firm as an additional cross-defendant and asserting claims for intentional interference with economic expectancy, abuse of process, conversion, and, against the Zumbrun firm only, breach of fiduciary duty.
The cross-complaint was transferred to Sacramento Superior Court and consolidated with the malpractice suit. A Sacramento Superior Court judge ruled that the cross-complaint, with the exception of the Campbells’ claim for declaratory relief regarding the interpled funds, was a SLAPP.
He also sustained a demurrer, based on the litigation privilege.
Blease agreed that the suit was a SLAPP. Asserting a lien for attorney fees, he said, is an “act in furtherance of a person’s right of petition or free speech” in connection with a judicial proceeding and thus protected by Code of Civil Procedure Sec. 425.16.
The Campbells argued that because they had no written contingency fee agreement, as required by law, Zumbrun lacked a “valid” First Amendment claim and the anti-SLAPP statute did not apply. But Blease said the constitutional claim was valid regardless of the merits of the lien, since Zumbrun has the right to petition a court.
“The fact the relief might not be granted for lack of merit does not in any way lessen the validity of the right to file such a petition,” the justice wrote.
He went on to agree with the trial judge that the Campbells’ claims were barred by the absolute litigation privilege set forth in Civil Code Sec. 47(b). All of the claims were based on “communicative acts” undertaken by Zumbrun with respect to the condemnation action and related judicial proceeding, the justice said, and were relevant to the legal issues.
The case is Campbell v. Zumbrun & Findley, C038103.
Copyright 2002, Metropolitan News Company