Filed 4/29/14 P. v. Financial Casualty & Surety CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
THE PEOPLE, D063699
Plaintiff and Respondent,
v. (Super. Ct. No. 37-2012-0079189- CU-EN-SC) FINANCIAL CASUALTY & SURETY, INC.,
Defendant and Appellant.
APPEAL from an order and judgment of the Superior Court of San Diego County,
Stephanie Sontag, Lisa C. Schall and Timothy R. Walsh, Judges. Affirmed.
E. Alan Nunez for Defendant and Appellant.
Thomas E. Montgomery, County Counsel and Thomas Deak, Senior Deputy
County Counsel, for Plaintiff and Respondent. INTRODUCTION
This is the second appeal in which surety Financial Casualty & Surety, Inc.
(Financial) seeks to be relieved of its obligations under a bail bond. Finding the first
appeal wholly without merit, we denied Financial's motion to vacate the bail bond
forfeiture after concluding the addition of prior convictions to the criminal complaint did
not change the circumstances under which the bail bond was issued. (People v. Financial
Casualty & Surety, Inc. (Aug. 2, 2012, D061015) [nonpub.opn.].)
In this second appeal, Financial argues the trial court lost jurisdiction during the
first appeal to enter summary judgment on the forfeiture under Penal Code section 13061
because the court did not have the power to stay the proceedings, even though it did so at
Financial's request. Again, we find Financial's appeal without merit and affirm.
Financial is estopped from asserting a jurisdictional defect of its own making. It may not
challenge the court's authority to stay the bail bond proceedings pending appeal as
beyond the court's jurisdiction when Financial requested the stay.
FACTUAL AND PROCEDURAL BACKGROUND
Financial posted a $25,000 bail bond in June 2010 to guarantee the appearance of
Victor Resendiz in a criminal case. When Resendiz failed to appear for a court
appearance, the court ordered his bail forfeited and mailed notice of the forfeiture on
November 23, 2010.
1 All further statutory references are to the Penal Code.
2 At Financial's request, the trial court extended the 180-day period to set aside the
forfeiture. At the conclusion of the October 21, 2011 hearing on Financial's motion to
vacate the forfeiture, the clerk of the court asked if Financial needed more time on the
forfeiture. Counsel for Financial announced it would appeal and stated the time for the
forfeiture should be stayed. He asked, "that efforts to collect the forfeiture not be
instituted . . . until we have a final judgment." As requested, the court issued a stay of the
judgment pending the appeal. The court entered its order denying the request to vacate
forfeiture of the bond on November 4, 2011.
We issued our decision in the first appeal on August 2, 2012 and affirmed the
order denying the motion to vacate. (People v. Financial Casualty & Surety, Inc., supra,
D061015.) Thereafter, the trial court entered summary judgment on the forfeiture on
October 31, 2012.
Financial moved to set aside the summary judgment and discharge the forfeiture
arguing the court lacked jurisdiction to enter summary judgment because it did not do so
within 90 days after it denied the motion to vacate forfeiture. The People opposed the
motion arguing Financial is estopped from challenging the stay of judgment because it
requested the stay.
The court denied the motion stating, "[s]ince Financial requested the court stay the
entry of judgment, it is estopped from arguing the court was without jurisdiction to enter
summary judgment beyond the 90-day time frame" set forth in section 1306, subdivision
(c).
3 DISCUSSION
I
Overview of Bail Forfeiture Statutes
When a defendant for whom bail has been posted fails to appear as ordered, the
court declares the bail forfeited and provides notice of forfeiture to the surety and the bail
agent as required by statute. (§ 1305, subds. (a) & (b).) If the defendant appears within
180 days of the mailing of the notice of forfeiture, plus five days for service by mail, the
court must vacate the forfeiture and exonerate the bond. (§ 1305, subd. (c)(1).) This
185-day period may be extended by motion no more than 180 days for a total
"appearance period" of 365 days. (§ 1305.4; People v. Accredited Surety & Casualty
Co., Inc. (2013) 220 Cal.App.4th 1137, 1148 (Accredited Surety).)
The court must enter summary judgment within 90 days after the appearance
period elapses without the forfeiture being set aside or, after a motion to vacate is
decided, if filed prior to expiration of the appearance period but decided after expiration
of the period. (§ 1306, subd. (c); People v. Granite State Insurance Co. (2003) 114
Cal.App.4th 758, 763, 770 [90-day period to enter summary judgment commences the
day following the denial of a timely motion to vacate forfeiture is decided, if decided
after expiration of appearance period].) Once summary judgment is entered, the district
attorney or county counsel must commence enforcement efforts. (§ 1306, subd. (e).) "If,
because of the failure of any court to promptly perform the duties enjoined upon it
pursuant to this section, summary judgment is not entered within 90 days after the date
4 upon which it may first be entered, the right to do so expires and the bail is exonerated."
(§ 1306, subd. (c), italics added.)
II
Estoppel Prevents Financial From Setting Aside Summary Judgment, Even if Entered in Excess of the Court's Jurisdiction
In this case, summary judgment was not entered within 90 days of either when the
total appearance period would have lapsed (absent a stay) or entry of the order denying
the motion to vacate the forfeiture. The order denying the motion to vacate was entered
on November 4, 2011 and summary judgment was not entered until October 31, 2012,
after the first appeal concluded. The record does not indicate this was due to a failure of
the court to promptly perform a duty required under the statutory scheme. Instead, the
court stayed entry of summary judgment, at Financial's request, to permit Financial to
pursue an appeal before enforcement efforts commenced.
Nevertheless, Financial argues the court did not have authority to stay the
proceedings because the statute does not address the possibility of a stay of entry of
summary judgment. As a result, Financial argues the entry of summary judgment was
void because the court did not have jurisdiction to enter judgment more than 90 days after
it denied the motion to vacate. The People argue the court has, among its inherent
powers, the power to control the proceedings before it. Since, the inherent powers of the
courts "are derived from the state Constitution and are not confined by or dependent on
statute" (Cottle v. Superior Court (1992) 3 Cal.App.4th 1367, 1377), the People argue the
court had the power to stay the bail bond proceedings. We need not reach the issue of
5 whether the court has the power to enter a stay of the bail bond proceedings because we
decide this appeal on estoppel principles. (County of Los Angeles v. Ranger Ins. Co.
(1999) 70 Cal.App.4th 10, 18 (Ranger I).)
The Supreme Court in People v. American Contractors Indemnity Co. (2004) 33
Cal.4th 653 explained there are two types of jurisdictional errors. A court may lack
jurisdiction in a fundamental sense meaning " 'an entire absence of power to hear or
determine the case, an absence of authority over the subject matter or the parties,' " which
renders a judgment void and subject to attack at any time. (Id. at p. 660.) It may also
lack jurisdiction when, " 'though the court has jurisdiction over the subject matter and the
parties in the fundamental sense, it has no "jurisdiction" (or power) to act except in a
particular manner, or to give certain kinds of relief.' " (Id. at p. 661.) In the later
instance, "[w]hen a court has fundamental jurisdiction, but acts in excess of its
jurisdiction, its act or judgment is merely voidable. [Citations.] That is, its act or
judgment is valid until it is set aside, and a party may be precluded from setting it aside
by 'principles of estoppel, disfavor of collateral attack or res judicata.' " (Ibid.)
The jurisdiction at issue in this case is of the second type. The court had
fundamental jurisdiction over the subject matter and the parties at the time it entered the
stay. If the court did not have authority to stay the proceedings, the court's entry of the
stay order and the subsequent entry of summary judgment after expiration of the 90-day
period were acts in excess of its jurisdiction. (Accredited Surety, supra, 220 Cal.App.4th
at p. 1149.) The resulting judgment is merely voidable and Financial may be estopped
6 from asserting a jurisdictional challenge because it invited the court to exceed its
jurisidiction in granting the stay.
Financial argues jurisdiction cannot be conferred by consent or estoppel.
However, the Supreme Court has explained the rule cited by Financial "relates to subject
matter jurisdiction, the court's power to hear and determine the cause." (In re Griffin
(1967) 67 Cal.2d 343, 346.) When the court has subject matter jurisdiction, "[t]here is
substantial authority for the proposition that a party who has invoked or consented to the
exercise of jurisdiction beyond the court's authority may be precluded from challenging it
afterward." (2 Witkin, Cal. Procedure (5th ed. 2008) Jurisdiction, § 333, p. 949.) "[A]
party who seeks or consents to action beyond the court's power as defined by statute or
decisional rule may be estopped to complain of the ensuing action in excess of
jurisdiction." (In re Griffin, supra, 67 Cal.2d at p. 347.)2
In the context of bail proceedings, courts apply estoppel to prevent sureties from
challenging jurisdiction when their conduct resulted in entry of summary judgment
beyond the statutory 90-day period. In Ranger I, supra, 70 Cal.App.4th 10, the court
held the surety was estopped from arguing summary judgment was not timely entered
2 To support its argument, Financial relies on Tabor v. Superior Court of Los Angeles County (1946) 28 Cal.2d 505, 508, which held a "premature notice of intention to move for a new trial was 'a nullity and ineffectual for any purpose' and that in the absence of the filing of a timely notice, [the] court was without power to entertain the motion." The Supreme Court rejected this argument (asserted by the same attorney) in the context of the bail forfeiture statutes by distinguishing Tabor as an attack by extraordinary writ while the trial court proceeding was ongoing rather than a collateral attack on a voidable but final judgment. (People v. American Contractors Indemnity Co., supra, 33 Cal.4th at p. 665.) 7 because the surety asked the court to toll the appearance period and then argued the court
had no jurisdiction to issue the tolling order. (Id. at pp. 12, 15.) The court rejected the
surety's argument stating, "Ranger . . . came to the trial court . . . with its hat in hand,
seeking and receiving a favor—the tolling of the statutory time period in which to have
the forfeiture on its bond vacated. Having been handed the favor, Ranger now seeks to
bite the hand from which the favor was obtained by contending the trial court was
without authority to toll the running of the 185-day." (Id. at pp. 18-19.) "We will not
permit Ranger to 'trifle with the courts.' " (Id. at p. 19.)
In People v. National Automobile & Casualty Ins. Co. (2000) 82 Cal.App.4th 120,
the surety stipulated to extend the appearance period after the statutory deadline expired.
(Id. at pp. 123, 125.) The court held the surety was estopped from challenging the
extension of the appearance period and the late entry of summary judgment stating,
"although the trial court had acted in excess of its jurisdiction when it extended the
appearance period, the [s]urety here is estopped from challenging those orders. Since its
challenges to the summary judgments are premised upon the alleged invalidity of those
orders, those challenges also fail." (Id. at p. 127.)
The court in People v. Bankers Ins. Co. (2010) 182 Cal.App.4th 1377, 1385
followed these authorities and applied estoppel to prevent a surety from challenging the
court's jurisdiction to enter summary judgment after it sought an extension of the
appearance period. The court concluded, "the surety's affirmative conduct makes it
appropriate to estop it from challenging the trial court's erroneous extension of the
appearance period. To rule otherwise . . . would create a wholly unacceptable precedent,
8 encouraging sureties to request multiple extensions from busy judges and, when their
requests are honored and they nevertheless cannot produce the defendant, claim that they
were wrong to have asked for further time and the judge should not have listened to their
entreaties. To permit the surety to have it both ways—to obtain more time to avoid
forfeiture of the bond, and then to have the bond exonerated because the judge gave them
more time—would be to allow an intolerable manipulation of the trial courts. This we
cannot and will not condone." (Id. at p. 1386.)
In Accredited Surety, supra, 220 Cal.App.4th 1137, a surety sought an extension
of time to move for relief from forfeiture. It filed its motion on the 185th day of the
initial appearance period and left a blank in the proposed order for the end date. The
People did not oppose the request and suggested the statutory deadline be extended "180
days from the date of the hearing on this motion," which resulted in an appearance period
greater than 365 days and summary judgment entered more than 90 days after the
expiration of the 365-day period. (Id. at p. 1141.) The appellate court held the surety
was estopped from challenging the timeliness of the summary judgment because "it
acquiesced in the scheduling error leading to the late entry of the summary judgment."
(Id. at pp. 1140, 1150-1151.) Since the surety did not advise the trial court the deadline
should be set earlier, the appellate court determined the failure to object was sufficient to
constitute consent or acquiescence. (Id. at p. 1150.) " 'A party cannot sit idly by and
permit action to be taken and later say that it had not consented.' " (Ibid., quoting Bel
Mar Estates v. California Coastal Com. (1981) 115 Cal.App.3d 936, 940.)
9 In this same vein, the court in Mt. Holyoke Homes, LP v. California Coastal Com.
(2008) 167 Cal.App.4th 803, 842 held a developer was estopped to contest the California
Coastal Commission's jurisdiction to hear administrative appeal when it participated in
the proceedings for years before asserting the commission lost jurisdiction for failure to
comply with time period for hearing. The court noted the developer's actions constituted
acquiescence to jurisdiction or, alternatively, invited error. (Ibid.)
We agree with these authorities and conclude Financial is estopped from
challenging the court's jurisdiction to enter summary judgment after it lost an appeal,
having obtained a stay for the purpose of pursing the appeal. Financial initially moved to
vacate the forfeiture arguing it should be relieved of its obligation under the bond because
the complaint filed against the criminal defendant had allegations greater than the
"charges" for which he was arrested. When the trial court denied this motion, the court
clerk asked if it wanted more time on the forfeiture.3 Counsel responded by saying the
matter should be stayed pending an appeal and asked, "that efforts to collect the forfeiture
not be instituted . . . until we have a final judgment." The court granted the stay.
Whether this exchange can be interpreted as a request for a stay of the appearance
period or a stay of entry of judgment, it is unseemly for Financial to now argue in this
3 We apparently do not have a complete record of the extension requests in this case. Financial suggests the court extended the appearance period to or near the maximum extension permitted under section 1305.4 since the notice of forfeiture was mailed on November 23, 2010 and the motion to exonerate bail was heard on October 21, 2011. Therefore, at the hearing on October 21, 2011, 33 days remained before the total appearance period of 365 days could have elapsed on November 23, 2011 if the full extension period were granted. If Financial could have procured and produced the defendant within that time, bail would have been exonerated. 10 second appeal it did not actually request or take advantage of the stay and to further argue
its former counsel was ignorant or did not know what he was doing. As a result of the
stay, summary judgment was not entered and enforcement efforts under section 1306,
subdivision (e) did not commence, just as Financial's counsel requested. Financial was
not required to immediately pay the forfeited amount and it was not required to post a
bond for its first appeal as it admits it would have been required to do if judgment was
entered.
In reaching our conclusion, we bear in mind the law traditionally disfavors
forfeiture and we must strictly construe the bail bond statutes to avoid "the harsh results
of a forfeiture." (County of Los Angeles v. American Contractors Indemnity Co. (2007)
152 Cal.App.4th 661, 665-666.) This rule of strict construction represents concern "not
so much for the bail bond companies, to whom forfeiture is an everyday risk of doing
business, but for those who bear the ultimate weight of the forfeiture, family members
and friends who have pledged their homes and other financial assets to the bonding
companies to secure the defendant's release." (Id. at p. 666.) It is for this reason the
statutory procedures imposed on the court and the prosecuting agencies in sections 1305
and 1306 require precision and timeliness. (County of Los Angeles. v. Surety Ins. Co.
(1984) 162 Cal.App.3d 58, 63.)
However, where the requirements of a statute "are primarily for the benefit of [a]
defendant [they] may be waived." (West Coast Constr. Co. v. Oceano Sanitary Dist.
(1971) 17 Cal.App.3d 693, 699 [participation in a preliminary injunction hearing set one
day beyond the statutory limit estopped defendant from challenging validity of
11 injunction].) Similarly here, because the statutory deadlines are primarily for the benefit
of the surety, it stands to reason a surety may, and did in this case, waive the statutory
protections.
It smacks of gamesmanship for Financial to ask the trial court for the favor of a
stay to seek an appeal and then, having obtained the favor of the stay, to argue the court
lost jurisdiction to enter summary judgment because it had no authority to grant the stay
requested. We will not allow or condone this trifling with the court. (In re Griffin,
supra, 67 Cal.2d at p. 348; Ranger, supra, 70 Cal.App.4th at p. 19.)
III
The Appeal Is Not Frivolous
The People argues this appeal is "arguably frivolous" and "wholly without merit"
because Financial failed to address the foregoing estoppel authorities in its opening brief.
It also pointed out Financial's current attorney, E. Alan Nunez, was previously sanctioned
for bringing a frivolous appeal in a similar case where he asserted a court lacked
jurisdiction to grant an extension request sought by the surety.
Because the People did not move for sanctions, on our own motion we notified the
parties we were considering whether the appeal is frivolous and, if so, whether to impose
sanctions against Financial and/or its counsel for filing and prosecuting a frivolous
appeal. We provided an opportunity for opposition and oral argument. (Code Civ. Proc.,
§ 907; Cal. Rules of Court, rule 8.276; In re Marriage of Flaherty (1982) 31 Cal.3d 637,
650 [an appeal is frivolous when prosecuted for an improper motive or when it
indisputably has no merit].) The opposition provided by Nunez on behalf of Financial
12 recasted Financial's arguments on the merits and did little to address this court's concern
regarding the failure to discuss pertinent authorities in the opening brief.
In People v. Ranger Ins. Co. (2002) 101 Cal.App.4th 605 (Ranger II), the Third
District sanctioned Nunez and the surety $10,000 for failing to address three published
cases applying estoppel to bail bond proceedings, even though Nunez was the attorney of
record in each of the cases. (Id. at pp. 609-611 citing Ranger I, supra, 70 Cal.App.4th at
pp. 18-19, People v. National Automobile and Casualty Ins. Co., supra, 82 Cal.App.4th at
pp. 124-127; People v. Frontier Pacific Co. Insurance (2000) 83 Cal.App.4th 1289, 1294
[surety who requested a hearing on its section 1304.5 motion for extension after
expiration of the 185-day period was estopped from arguing the court lacked jurisdiction
to enter the extension order].)
Contrary to Nunez's contention, he was not sanctioned solely for miscounting
days. The court in that case concluded the appeal was frivolous in large part because he
failed to address authorities directly adverse to his client's position. (Ranger II, supra,
101 Cal.App.4th at p. 611.)
Here Nunez failed to address the same estoppel cases in the opening brief even
though the trial court based its denial of Financial's motion to set aside summary
judgment on estoppel. He "fully anticipated" the People would rely on these estoppel
authorities in the respondent's brief and "chose to await discussion of those cases in its
reply brief."
Nunez attempted to distinguish these cases in the reply brief by arguing they
involved requests for extensions of the appearance period rather than a stay. We conclude
13 this is a distinction without a difference. The effect of a request or stipulation to extend
the appearance period beyond the statutory limit is the entry of summary judgment after
expiration of 90-day time period permitted by section 1306, subdivision (c). As Financial
admits, "[s]uch action on the part of the surety [is] tantamount to first telling the court
that the extension of the 180-day period would not affect its power to enter summary
judgment and later turning around and arguing that it had no power to enter summary
judgment."
Similarly here, Financial's request to stay entry of judgment arguably resulted in
entry of judgment after the 90-day time period. Financial's conduct in this case likewise
told the court the stay would not affect its power to enter summary judgment, but it now
argues the court had no power to stay the judgment or to enter summary judgment after
the first appeal.
Each of the estoppel cases discussed infra held the entry of judgment beyond the
90-day period was an act " 'in excess of jurisdiction, and not outside the court's
fundamental jurisdiction over the bail bond forfeiture' and therefore . . . the surety could
be estopped from challenging the summary judgment." (Accredited Surety, supra, 220
Cal.App.4th at p. 1149.) These cases are dispositive.
Nunez also argues estoppel should not apply because Financial's former attorney
was ignorant or mistaken about the law and Financial did not actually request or benefit
from the stay. As we have discussed, the record is clear Financial's counsel did request a
stay and Financial benefited from the stay. For the first time, in the sanctions opposition,
Financial suggests its former attorney could have been requesting a stay of collection
14 proceedings, but not necessarily a stay of entry of judgment. This argument has no merit.
Even if one could read counsel's request in this way (which we do not), at no time did
Financial or its counsel correct the court when it stated it would enter a stay or when its
minute order stated entry of judgment was stayed. This acquiescence estops Financial
from now asserting a failure to timely enter summary judgment. (Accredited Surety,
supra, 220 Cal.App.4th at p. 1150-1151.)4
We do not condone Nunez's briefing strategy in this case of choosing not to
candidly discuss authorities adverse to his client's position in the opening brief.
However, we agree there appear to be no cases directly addressing the application of
estoppel to facts where the court was asked to enter a stay of entry of the summary
judgment in bail proceedings. Therefore, under the circumstances, we decline to find the
appeal "indisputably has no merit" or that no "reasonable attorney would agree that the
appeal is totally and completely without merit." (In re Marriage of Flaherty, supra, 31
Cal.3d at p. 650.) As such, we will not impose sanctions.
4 We note Nunez failed to discuss Accredited Surety, supra, 220 Cal.App.4th 1137 in any briefing even though this recent case was cited by the People and even though Nunez was, again, counsel of record for the surety in that matter. 15 DISPOSITION
The judgment and the order denying the motion to set aside the judgment are
affirmed. Respondent is entitled to its costs on appeal.
MCCONNELL, P. J.
WE CONCUR:
HALLER, J.
O'ROURKE, J.