GUTIERREZ v. NICK PECORARO PAINTING

Filed 11/23/05 Gutierrez CA4/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

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COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

MIKE GUTIERREZ, Plaintiff and Respondent, v. NICK PECORARO PAINTING & DECORATING, INC., Defendant and Appellant.	D044666 (Super. Ct. No. GIC824212)
JAMES IRWIN, Plaintiff and Respondent, v. NICK PECORARO PAINTING & DECORATING, INC., et al. Defendants and Appellants.	D044675 (Super. Ct. No. GIC811653)

APPEALS from an order of the Superior Court of San Diego County, Patricia A. Y. Cowett, Judge. Appeal in case No. D044666 dismissed; order in case No. D044675 reversed.

These consolidated appeals concern two cases brought against painting contractor Nick Pecoraro Painting & Decorating, Inc. (Pecoraro Painting) challenging various labor practices: Irwin v. Nick Pecoraro Painting & Decorating, Inc. (D044675, Irwin) and Gutierrez v. Nick Pecoraro Painting & Decorating, Inc. (D044666, Gutierrez).^[1] Gutierrez and Irwin were both pending in the San Diego Superior Court but were assigned to different independent calendar departments.

Defendants in Gutierrez and Irwin challenge rulings by the independent calendar department handling the Irwin case, in which that court (1) on its own motion, reconsidered and vacated its previous order compelling arbitration of Irwin; (2) denied Pecoraro Painting's motion to transfer the Gutierrez case to its department; and (3) declined to rule on Pecoraro Painting's petition to compel arbitration of Gutierrez, directing instead that it be heard in the independent calendar department to which the Gutierrez case was assigned.

As we will explain, we do not reach the merits of these issues. Instead, we conclude: (1) because plaintiffs already had voluntarily dismissed Irwin, the ruling vacating the order compelling arbitration of Irwin was void and in excess of the court's jurisdiction; and (2) the order taking the petition to compel arbitration of Gutierrez off calendar is not an appealable order. We accordingly (1) dismiss the appeal of Gutierrez and (2) reverse as void the ruling vacating the order compelling arbitration of Irwin.^[2]

I

FACTUAL AND PROCEDURAL BACKGROUND

A

The Irwin Action

Irwin was filed on February 21, 2003, in San Diego County Superior Court against Pecoraro Painting and it owners Josephine Ann Pecoraro and Nicolo Pecoraro (the Irwin Defendants). The case was assigned to Judge Patricia A.Y. Cowett in department 67.

Plaintiffs in Irwin are James Irwin, a representative for Southern California Painters and Allied Trades District Council No. 36, AFL-CIO (Union), and six former Pecoraro Painting employees.^[3] The Irwin Plaintiffs filed the suit as a representative action and on behalf of the general public, alleging that Pecoraro Painting's labor practices did not comply with applicable laws governing wages, hours and conditions of employment. They alleged causes of action for unfair business practices (Bus. & Prof. Code, § 17200), violations of the Labor Code (Lab. Code, §§ 204, 204.3, 223, 226, 226.7, 221, 2802), breach of contract and fraud.

The Irwin Defendants filed a petition to compel arbitration (Irwin Petition) premised on the Irwin Plaintiffs' allegation that they are third party beneficiaries of over 40 construction contracts entered into by Pecoraro Painting — all of which contain an arbitration clause. The Irwin Plaintiffs failed to file a timely response to the Irwin Petition, and on September 12, 2003, Judge Cowett entered an order compelling arbitration on the basis that the lack of a timely response deemed the allegations of the Irwin Petition admitted as a matter of law.

After the order compelling arbitration of Irwin, the parties could not come to an agreement on how the arbitration should proceed. They disagreed, among other things, on whether there should be over 40 different arbitrations based on the over 40 different arbitration provisions in the underlying construction contracts.

Plaintiffs filed a request for voluntary dismissal without prejudice of Irwin on February 5, 2004, which was entered by the clerk of the court on that day. On March 30, 2004, apparently at the request of the Irwin Plaintiffs, Judge Cowett also entered a judgment of dismissal of Irwin.

B

The Gutierrez Action

Gutierrez was filed against Pecoraro Painting on September 26, 2003 — two weeks after the order compelling arbitration in Irwin. The sole plaintiff is Mike Gutierrez who, like Irwin, is a Union representative and is not an employee of Pecoraro Painting. The original complaint in Gutierrez alleged the same unfair labor practices as Irwin and asserted the same causes of action as Irwin. Both Gutierrez and Irwin were filed by the same plaintiffs' counsel.

On February 6, 2004, Gutierrez filed an amended complaint alleging only causes of action under Business and Professions Code section 17200 (Section 17200).^[4] The amended complaint retains most of the substantive allegations of the previous complaint and cites the same Labor Code sections, but recasts each cause of action as arising under Section 17200. Alleging that it was brought as a representative action and on behalf of the general public, the amended complaint seeks injunctive relief as well as restitution, disgorgement and declaratory relief.

Gutierrez, which was originally filed in Orange County Superior Court, was later transferred to San Diego County Superior Court but was not assigned to Judge Cowett, who was handling the Irwin case, but instead was assigned to Judge Jeffrey B. Barton in department 69. Judge Cowett set a status conference for February 20, 2004, to consider whether Gutierrez should be transferred to her department and consolidated with Irwin. At the status conference, Judge Cowett directed the parties to file noticed motions addressing whether Gutierrez and Irwin should be related and consolidated, whether arbitration should be compelled in Gutierrez, and whether plaintiffs' voluntary dismissal of Irwin was required to be with prejudice.^[5]

These appeals concern the rulings made by Judge Cowett in response to the motions subsequently filed by the parties. We thus turn to an explanation of those motions.

C

Judge Cowett's Rulings

Pecoraro Painting filed three motions: (1) a motion to have Gutierrez transferred to Judge Cowett's department; (2) a petition to compel arbitration of Gutierrez, or in the alternative, a stay of Gutierrez until the Irwin arbitration was complete (the Gutierrez Petition); and (3) a motion directing that the dismissal of Irwin, pursuant to plaintiffs' February 5, 2004 request for dismissal, be with prejudice. In support of the Gutierrez Petition, Pecoraro Painting argued that Gutierrez is "nothing more than a disguised continuance of the Irwin litigation for the purpose of avoiding the Irwin order compelling arbitration."

The Irwin Plaintiffs filed a single motion seeking dismissal of their action, or in the alternative, an order setting aside the order compelling arbitration. The Irwin Defendants opposed the motion, pointing out that Irwin already had been dismissed pursuant to the Irwin Plaintiffs' February 5, 2004 request for voluntary dismissal, and that, accordingly, the only remaining issue was the Irwin Plaintiffs' alternative request to set aside the order compelling arbitration of Irwin. The Irwin Defendants argued that the request to set aside the order compelling arbitration should be denied as either (1) an untimely motion for reconsideration or (2) an improper motion for relief on the basis of attorney mistake under Code of Civil Procedure section 473.

Judge Cowett made several rulings in response to the various motions. First, on her own motion, Judge Cowett reconsidered and vacated her previous order granting the Irwin petition. As a basis for this ruling, Judge Cowett concluded that the voluntary dismissal of Irwin had subsequently "rendered moot" the order compelling arbitration. Specifically, Judge Cowett explained that the court "retains the authority to modify interim rulings at any time prior to the entry of judgment . . . based upon new law and/or facts that would justify the Court reconsidering its prior order." She concluded that "[i]n light of the [Irwin Plaintiffs'] dismissal of their underlying complaint and the fact that the [Irwin Petition] did not seek any affirmative relief on its own and instead merely sought to have Plaintiffs' claims be decided via an arbitration agreement . . . , there is nothing left to be decided in an arbitration and the need for said arbitration in this case has been rendered moot."

Turning to the motion to transfer Gutierrez to her department, Judge Cowett stated that because Irwin had been voluntarily dismissed and no related case was pending, the transfer would be denied. As a further basis for denying the transfer, Judge Cowett explained that she had "no special knowledge and/or familiarity with the parties and/or facts addressed by Gutierrez" because the Irwin Petition, although possibly raising related issues, had been "deemed admitted as a matter of law" rather than substantively litigated.

Finally, with regard to the Gutierrez Petition, Judge Cowett stated that the hearing on the Gutierrez Petition was "taken off calendar" and Pecoraro Painting should reschedule the hearing in Judge Barton's department. Judge Cowett explained that she "has no jurisdiction to rule on issues in a case that is pending before another court."^[6]

Defendants in both Gutierrez and Irwin filed notices of appeal. They challenge (1) Judge Cowett's decision vacating her previous order compelling arbitration of Irwin, both on substantive grounds and because Judge Cowett did not issue a statement of decision; (2) Judge Cowett's holding that she did not have jurisdiction to consider the Gutierrez Petition; and (3) Judge Cowett's denial of the motion to transfer Gutierrez to her department. Additionally, while these appeals were pending, on November 2, 2004, the voters passed Proposition 64, amending the standing requirements for a Section 17200 claim. Pecoraro Painting argues that we should dismiss Gutierrez because plaintiff lacks standing under the more demanding requirements of Proposition 64.

II

DISCUSSION

A

The Order Taking the Gutierrez Petition Off Calendar to Be

Heard in Another Department Is Not an Appealable Order

As a threshold matter, we first consider whether Judge Cowett 's order declining to rule on the Gutierrez Petition is an appealable order.

Pecoraro Painting relies on Code of Civil Procedure sections 1294 and 1294.2 as the basis for its appeal of Gutierrez. Section 1294, subdivision (a) states: "An aggrieved party may appeal from [¶] an order dismissing or denying a petition to compel arbitration." Section 1294.2 allows the court to review intermediate orders along with the order dismissing or denying the petition. Here, however, Judge Cowett did not dismiss or deny the Gutierrez Petition; she took the hearing off calendar so that the Gutierrez Petition could be heard in Judge Barton's department. Thus, our inquiry is whether an order taking a petition to compel arbitration "off calendar" to be heard in another department is the type of order made appealable by the Code of Civil Procedure. We conclude that it is not.

We have closely reviewed Judge Cowett's decision as to the Gutierrez Petition to determine whether it contains any appealable ruling, and we have found none. Judge Cowett plainly did not take action on the merits of the Gutierrez Petition and did not dismiss or deny it. Rather, she simply held that her department was not the proper forum for the Gutierrez Petition. Although Judge Cowett's statement that she lacked "jurisdiction" over the Gutierrez Petition might superficially appear to reflect a decision on the merits, on closer review, this word choice reflects only the view that the Gutierrez Petition should be heard in another department. Judge Cowett did not dismiss or deny the Gutierrez Petition but rather left it on file to be recalendared and decided in the first instance by Judge Barton.

Pecoraro Painting argues that Judge Cowett "in effect" denied the Gutierrez Petition, citing Henry v. Alcove Investment, Inc. (1991) 233 Cal.App.3d 94, 98-100, which held that an appeal may be taken from an order staying arbitration pursuant to Code of Civil Procedure section 1281.2 because it is the "functional equivalent" of an order denying a petition to compel arbitration. (Henry, at p. 99.) We reject this argument because Judge Cowett's ruling is not analogous to an order staying arbitration or any other ruling on the merits of a petition to compel arbitration. Code of Civil Procedure section 1281.2 requires a trial court to make a determination as to whether a stay of arbitration is statutorily authorized and appropriate. Here, Judge Cowett made no such determination. She simply directed that another department consider the Gutierrez Petition.

"The existence of an appealable judgment is a jurisdictional prerequisite to an appeal. A reviewing court must raise the issue on its own initiative whenever a doubt exists as to whether the trial court has entered" an appealable order or judgment. (Jennings v. Marralle (1994) 8 Cal.4th 121, 126.) Thus, as Gutierrez is not properly before us on appeal, we dismiss the appeal of Gutierrez on our own initiative and do not reach any of the other issues presented in that appeal.^[7]

B

The Ruling Vacating the Order Compelling Arbitration Is Void

We turn next to a review of Judge Cowett's decision vacating the order compelling arbitration of Irwin. As we will explain, we determine that Judge Cowett's ruling is void and must be reversed because it was made after the Irwin Plaintiffs voluntarily dismissed their case, leaving Judge Cowett without jurisdiction to reconsider her previous order.^[8]

"'A voluntary dismissal of an entire action deprives the court of subject matter jurisdiction as well as personal jurisdiction of the parties,'" and "[s]uch jurisdiction 'cannot be conferred by consent, waiver, or estoppel.'" (Harris v. Billings (1993) 16 Cal.App.4th 1396, 1405.) "'Following entry of such dismissal, the trial court is without jurisdiction to act further in the action . . . except for the limited purpose of awarding costs and statutory attorney's fees.'" (Aetna Casualty & Surety Co. v. Humboldt Loaders, Inc. (1988) 202 Cal.App.3d 921, 931, citations omitted; see also O'Dell v. Freightliner Corp. (1992) 10 Cal.App.4th 645, 659 ["Numerous cases note that voluntary dismissal of a lawsuit terminates the trial court's jurisdiction over the matter"].)^[9]

On February 5, 2004, the Irwin Plaintiffs filed a request for voluntary dismissal of their complaint under Code of Civil Procedure section 581.^[10] On the same day, the dismissal was entered by the clerk of the court. Consequently, after February 5, 2004, Judge Cowett had no jurisdiction to reconsider her previous orders, and Judge Cowett's June 11, 2004 order reconsidering her previous order compelling arbitration of Irwin was in excess of her jurisdiction.^[11] Judge Cowett's lack of jurisdiction to enter the order means that the order is void. "'[A]ny judgment or order rendered by a court lacking subject matter jurisdiction is 'void on its face . . . .'" (Varian Medical Systems, Inc. v. Delfino (2005) 35 Cal.4th 180, 196; see also Zapanta, supra, 107 Cal.App.4th at p. 1171 ["'An order by a court lacking subject matter jurisdiction is void'"]; Aetna Casualty & Surety Co. v. Humboldt Loaders, Inc., supra, 202 Cal.App.3d at p. 931 [after plaintiff's tender of a request for dismissal "all subsequent proceedings were void"].)

As an appellate court we have jurisdiction over an order entered in excess of a trial court's jurisdiction, but our "jurisdiction is limited to reversing the trial court's void acts." (Griset v. Fair Political Practices Com. (2001) 25 Cal.4th 688, 701; see also Eddings v. White (1964) 229 Cal.App.2d 579, 583 [appeal from a void order made after a voluntary dismissal is permitted so as "to clear the record"].) When an appeal is taken from an order that is void, "[t]he proper procedure is to reverse the void order." (Socialist Workers etc. Committee v. Brown (1975) 53 Cal.App.3d 879, 890, fn. 13; see also Ruiz v. Ruiz (1980) 104 Cal.App.3d 374, 379.) We thus reverse Judge Cowett's June 11, 2004 order vacating her previous order compelling arbitration, as it is void and in excess of the court's jurisdiction.^[12]

DISPOSITION

We dismiss the appeal in case No. D044666. In case No. D044675, we reverse the June 11, 2004 order vacating the order compelling arbitration. Each party to bear its own costs on appeal in each case.

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^[1] The defendants in Irwin, but not in Gutierrez, also include Josephine Ann Pecoraro and Nicolo Pecoraro, the owners of Pecoraro Painting.

^[2] As the parties had not briefed either of these issues, we afforded them the opportunity to do so pursuant to Government Code section 68081.

^[3] The plaintiff employees in Irwin are William Amaya, Jose Arriaga, Rene Camarena, James English, Octavio Vasquez and Mike Vuckovich. We refer to these individuals and Irwin collectively as "the Irwin Plaintiffs."

^[4] It appears that this amendment was made in an attempt to avoid arbitration. (See Cruz v. PacifiCare Health Systems, Inc. (2003) 30 Cal.4th 303, 315-316 [holding that an unfair competition claim for injunctive relief brought on behalf of the general public is not subject to arbitration].)

^[5] At the February 20, 2004 hearing, Judge Cowett expressed the view that the dismissal of the Irwin action did not affect the prior order compelling arbitration: "Even though the underlying action is dismissed, the separate petition is not dismissed and the order for arbitration stills stands." Judge Cowett also observed that the Irwin Plaintiffs "can't avoid the arbitration order pursuant to the petition by dismissing the case." As we will explain, Judge Cowett ultimately reached a different conclusion.

^[6] Judge Cowett also denied the Irwin Defendants' motion for an order requiring that plaintiff's voluntary dismissal of the Irwin action be with prejudice. That ruling is not a subject of this appeal. Further, the Irwin Defendants requested a statement of decision pursuant to Code of Civil Procedure section 1291 of Judge Cowett's decision vacating her previous order compelling arbitration of Irwin. Judge Cowett granted the request and ordered plaintiffs' counsel to prepare the statement of decision. The Irwin Plaintiffs submitted a proposed statement of decision, and the Irwin Defendants filed objections. However, Judge Cowett did not resolve the objections and ultimately did not issue a statement of decision.

^[7] We acknowledge, as do the parties, that the enactment of Proposition 64 while this appeal was pending raises the issue of whether Gutierrez has standing to pursue his action. Because the Gutierrez appeal is not properly before us, we do not reach the issue of whether Proposition 64 impacts Gutierrez's standing. We leave it to the court and the parties on remand to decide how to address the issues raised by Proposition 64.

^[8] The parties' initial briefing argued that Judge Cowett lacked jurisdiction on a different ground. The parties discussed whether, after a trial court orders a case to arbitration, it retains jurisdiction sufficient to allow it to reconsider its previous rulings. (See, e.g., Finley v. Saturn of Roseville (2004) 117 Cal.App.4th 1253, 1259 ["once a matter has been referred to arbitration, the court's involvement is strictly limited until the arbitration is completed"].) For reasons unclear to us, the parties' initial briefing did not address the more fundamental question of whether a trial court retains jurisdiction to reconsider its previous rulings after plaintiffs voluntarily dismiss their complaint. We raised the issue sua sponte because it affects our jurisdiction to consider the merits of the appeal, and we asked the parties to provide supplemental briefing. (See Porter v. United Services Automobile Assn. (2001) 90 Cal.App.4th 837, 838 ["We have the duty to raise issues concerning our jurisdiction on our own motion"].) In their supplemental briefing, the Irwin Plaintiffs do not dispute that Judge Cowett's order vacating her order compelling arbitration is void under controlling case law. Instead they argue that reversal would serve no purpose because Judge Cowett's underlying reasoning is nevertheless valid and will be adopted by any future court that considers whether the order compelling arbitration is moot. This argument does not provide a valid basis to disregard controlling authority requiring us to reverse void orders, and we express no view on the merits of Judge Cowett's reasoning.

^[9] It is worth noting that "[e]ven after a voluntary dismissal with prejudice has been filed, the trial court has jurisdiction to vacate the judgment of dismissal under Code of Civil Procedure section 473 where it has been entered as a result of the plaintiff's 'mistake, inadvertence, surprise, or excusable neglect.'" (Basinger v. Rogers & Wells (1990) 220 Cal.App.3d 16, 21-22, fn. omitted.) Here, however, Code of Civil Procedure section 473 was not the basis for Judge Cowett's order, although that provision was raised by the Irwin Plaintiffs to Judge Cowett as a basis of the request to vacate the order compelling arbitration.

^[10] We note that "[t]he right of a plaintiff to voluntarily dismiss an action before commencement of trial is not absolute. Code of Civil Procedure section 581 recognizes exceptions to the right; other limitations have evolved through the courts' construction of the term 'commencement of trial.' These exceptions generally arise where the action has proceeded to a determinative adjudication, or to a decision that is tantamount to an adjudication." (Harris v. Billings, supra, 16 Cal.App.4th at p. 1402; see also Zapanta v. Universal Care, Inc. (2003) 107 Cal.App.4th 1167, 1174 (Zapanta) [a voluntary dismissal is not valid if it "conflict[s] with other statutory provisions, judicial procedures or public policy"].) We are not here presented with the issue of whether, under the circumstances, the Irwin Plaintiffs had the right to voluntarily dismiss their complaint. As the parties have not called that right into question, we assume for the sake our of analysis that Irwin was properly dismissed.

^[11] We also note that although it was not necessary to effect a dismissal under Code of Civil Procedure section 581, subdivision (b), Judge Cowett, apparently at the request of the Irwin Plaintiffs, also purported to enter a judgment of dismissal on March 30, 2004.

^[12] Because we determine that Judge Cowett's June 11, 2004 order is void, we need not and do not consider whether Judge Cowett erred in failing to issue a statement of decision.