Salowitz Organization, Inc. v. Traditional Industries, Inc.

*800 Opinion

In this case we consider whether a trial court has the inherent power to deny a motion for a trial de novo as a sanction for abuse of judicially mandated arbitration. Since we find an award of attorney’s fees and costs under Code of Civil Procedure section 128.5 1 the only appropriate sanction, we further find additional monetary sanctions imposed for bringing a motion for reconsideration of the order denying the trial de novo an abuse of discretion.

Facts and Proceedings Below

In December 1985 respondent, the Salowitz Organization, Inc. (Salowitz), filed a lawsuit against appellant Traditional Industries, Inc. (Traditional), for breach of contract. Trial was set for April 6, 1987. Salowitz filed a motion to compel production of documents on January 14, 1987. On February 10, 1987, three days before the hearing on the motion to compel, Goldenring & Goldenring notified Salowitz it was going to substitute in as counsel for Traditional and requested Salowitz to continue the hearing on the motion to compel. Three days before the continued motion to compel, one month before trial and seven months after the initial discovery request, Traditional finally responded.…

I concur in the majority opinion but write separately to express my view that this case is an example of the “egregious” conduct mentioned by Supreme Court Justice Reynoso in his concurring opinion in Lyons v. Wickhorst (1986) 42 Cal.3d 911, 927 [ 231 Cal.Rptr. 738 , 727 P.2d 1019 ]. In discussing the power of the court to dismiss an action although not specifically provided in Code of Civil Procedure section 128.5, he states: “However, I do not believe that the staff report relied on by Justice Grodin (post) and the majority opinion as legislative history [citation] is a sufficient basis for precluding court exercise of inherent powers. I would leave open the question whether, in a particularly egregious case, a trial court would have inherent power to dismiss the action. ” (Italics added.) Justices Lucas and Panelli concurred in Justice Reynoso’s opinion.

Unfortunately, Justice Reynoso’s view is dicta expressed in a minority opinion. I suggest, however, that this case might be a suitable one for the California Supreme Court to reassess its views expressed in Lyons . Conjointly the Legislature may wish to amend Code of Civil Procedure section 128.5 to provide for dismissal as an…

In this case we consider whether a trial court has the inherent power to deny a motion for a trial de novo as a sanction for abuse of judicially mandated arbitration. Since we find an award of attorney's fees and costs under Code of Civil Procedure section 128.5 [1] the only appropriate sanction, we further find additional monetary sanctions imposed for bringing a motion for reconsideration of the order denying the trial de novo an abuse of discretion.

In December 1985 respondent, the Salowitz Organization, Inc. (Salowitz), filed a lawsuit against appellant Traditional Industries, Inc. (Traditional), for breach of contract. Trial was set for April 6, 1987. Salowitz filed a motion to compel production of documents on January 14, 1987. On February 10, 1987, three days before the hearing on the motion to compel, Goldenring & Goldenring notified Salowitz it was going to substitute in as counsel for Traditional and requested Salowitz to continue the hearing on the motion to compel. Three days before the continued motion to compel, one month before trial and seven months after the initial discovery request, Traditional finally responded. Salowitz, requiring more…