Metropolitan News-Enterprise


Thursday, February 5, 2015


Page 1


Court of Appeal Rules:

Observation of Factual Matter in Earlier C.A. Decision Not Binding

Rylaarsdam: Action Should Not Have Been Dismissed Based on His Earlier Statement That the Plaintiff Is Not a California Resident


By a MetNews Staff Writer


The Fourth District Court of Appeal’s Div. Three, in an opinion certified for publication yesterday, reversed a judgment of dismissal by an Orange Superior Court judge who relied on language in the appeal’s court’s earlier opinion in the case.

Justice William Rylaarsdam, who wrote the opinion, filed Jan. 13, admitted that his 2011 opinion contained inconsistent statements, contributing to the confusion—but said the trial court still should not have dismissed the action.

In that earlier opinion (Investors Equity Life Holding Co. v. Schmidt (2011) 195 Cal. App. 4th 1519), Rylaarsdam said that Judge Nancy Wieben Stock correctly stayed an action against Hawaii defendants based on the doctrine of forum non conveniens.

Stock subsequently dismissed the action based on an observation in the opinion that the plaintiff corporation was not a California resident.

Rylaarsdam acknowledged, saying that he hedged on that statement elsewhere in the opinion. The jurist noted:

“Somewhat confusingly, we characterized plaintiff’s claim to California residency as both ‘erroneous’ and merely ‘doubtful.’ ”

Rylaarsdam elaborated:

“We characterized plaintiff’s claim of residency at one point as ‘erroneous,’ but then supported that characterization with the less-definitive explanation that plaintiff’s ‘admission it has been authorized to transact business in California as a ‘foreign corporation’ undermine[s] its status as a California resident.’…We later referred to plaintiff’s residency claim as merely ‘doubtful.’ ”

Stock’s Ruling

In dismissing the action, Stock said:

“Plaintiff is not a California resident. That is the law of the case. The evidence offered by Plaintiff on this point is therefore, irrelevant. Plaintiff is collaterally estopped from relitigating this issue.”

 The doctrine of law of the case was erroneously invoked, Rylaarsdam declared. The doctrine, he explained, “applies only to legal principles applied on appeal; it has no application to factual determinations, such as whether plaintiff provided adequate evidence to support a claim of residence status for purposes of a forum non conveniens motion.”

In the earlier opinion, he explained, “we simply rejected (or perhaps merely cast doubt on) plaintiff’s conclusory assertion of ‘residency” as a basis for claiming an entitlement to deference in its choice of forum.”

He characterized that as “essentially” a “factual determination.”

Error Was ‘Compounded’

Rylaarsdam faulted the trial judge for having “compounded” her error “by also refusing to consider whether the additional evidence offered by plaintiff to demonstrate its significant ties to California might bear on the analysis of whether this state still has an interest in retaining jurisdiction over this case.”

He said that one of the reasons for affirming the decision to stay the action was that while it believed that Hawaii had a statute of limitation analogous to California’s, that might not be so, and reassumption of jurisdiction might be necessary. Rylaarsdam also made reference to a promise by the defendants to agree, in a Hawaiian proceeding, that the statute there had been tolled.

“[I[t was error to order this case dismissed before the parties’ dispute is finally resolved in Hawaii,” he wrote.

Joseph K. Hegedus and Caroline E. Chan of Lewis Brisbois Bisgaard & Smith and David B. Parker and Theodore W. Frank Parker Shumaker & Mills represented the plaintiff/appellant.

Hawaii’s insurance commissioner, Jeffrey P. Schmidt, and the other Hawaiian defendants were represented by Lee H. Roistacher of Daley & Heft; C. Guerry Collins and Michelle C. Ferrara of Locke Lord; and Frank D. O’Loughlin and Cindy C. Oliver of Lewis Roca Rothgerber.


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