Opinion ID: 1296967
Heading Depth: 2
Heading Rank: 3

Heading: Substantial Probability Under Section 425.13(a)

Text: (3a) The Hospital and its amici curiae [4] insist the Court of Appeal erred by not construing section 425.13(a) to contain a rigorous weighing test. They argue that the statute not only disallows punitive damage claims that obviously lack merit, but also requires the court to assess the relative merits of a claim and to bar any punitive damages claim that does not appear highly likely to succeed at trial. A superficial reading of the statute might support this view. Section 425.13(a) speaks in terms of a substantial probability that the punitive damages claim will prevail under Civil Code section 3294. The noun probability commonly suggests a relative likelihood that a particular outcome will occur. By referring to whether the claim will prevail, the statute might be read to require an assessment of the plaintiff's chances of recovering punitive damages at trial. Further narrowing of the class of permissible claims might be inferred from use of the adjective substantial to qualify probability. Read in context, however, the statutory language hardly compels this unusual interpretation. Section 425.13(a) does not expressly instruct the trial court to weigh evidence or make an independent assessment of its relative strength. The affidavit format described by the statute is a truncated one, reminiscent of summary judgment procedure. It is not well suited to predicting how the jury would react to a full-blown case at trial. The phrase substantial probability, standing alone, is particularly ambiguous. These and similar words are widely used in California law under circumstances which indicate that their meaning depends entirely upon the particular context. (4) For example, trial error is usually deemed harmless in California unless there is a reasonabl[e] probab[ility] that it affected the verdict. ( People v. Watson (1956) 46 Cal.2d 818, 836 [299 P.2d 243].) We have made clear that a probability in this context does not mean more likely than not, but merely a reasonable chance, more than an abstract possibility. ( Id., at p. 837; cf. Strickland v. Washington (1984) 466 U.S. 668, 693-694, 697, 698 [80 L.Ed.2d 674, 697-700, 104 S.Ct. 2052] [reasonable probability does not mean more likely than not, but merely probability sufficient to undermine confidence in the outcome].) (5) By the same token, a judgment will not be disturbed for lack of evidence if the evidence in support of the judgment is substantial, that is, enough to allow a reasonable jury to have reached the challenged result. ( Crawford v. Southern Pacific Co. (1935) 3 Cal.2d 427, 429 [45 P.2d 183].) On the other hand, the trial court may indeed have to predict a reasonable probability of success on the merits before granting the extraordinary remedy of a preliminary injunction. ( Continental Baking Co. v. Katz (1968) 68 Cal.2d 512, 528 [67 Cal. Rptr. 761, 439 P.2d 889].) Similar flexibility appears in the Legislature's historical use of the substantial probability standard. The phrase is included in at least 30 provisions, most of which have nothing to do with civil pleading matters. (See, e.g., Evid. Code, § 1062, subd. (a) [trade secrets/closed hearing]; Gov. Code, §§ 8670.56.6, subd. (k)(2)(A) [oil spills/immunity], 37606, subd. (c)(2) [municipal hospitals/meetings]; Health & Saf. Code, §§ 1325 [long-term care facilities/receivership], 4038 [safe drinking water/penalties], 42301.7 [air pollution control/powers]; Lab. Code, § 1288, subd. (a) [employment/citations]; Pen. Code, § 859.1, subd. (b)(6) [minor victim/closed hearing]; Wat. Code, § 13304, subd. (e) [water pollution/remedies]; Welf. & Inst. Code, § 366.21, subd. (g)(1) [dependency hearing/custody].) Frequent use of the substantial probability test for such diverse purposes suggests that  whatever specific meaning it has acquired in a particular context  the Legislature has assigned it no uniform interpretation. By the same token, other statutes which do seem closely related to section 425.13(a) contain slightly varying expressions of the test for pleadability. (§§ 425.14 [plaintiff must substantiate punitive damages claim against religious corporation], 425.15, subd. (a) [same as to negligence claim against volunteer director or officer of nonprofit corporation], 425.16, subd. (b) [plaintiff must show probability of success on SLAPP suit]; see also Civ. Code, §§ 1714.10, subd. (a) [plaintiff must show reasonable probability of success on conspiracy claim against attorney], 3295, subd. (c) [plaintiff must show substantial probability of success on punitive damages claim before discovering financial information].) It seems unlikely that each subtle difference in phraseology was intended to establish a completely different legal standard. In any event, we will see that most of these statutes were patterned upon section 425.13(a) and have similar purposes. (3b) Finally, if the Legislature literally intended section 425.13(a) to prevent trial of all but the most compelling punitive damage claims, means were available to make that purpose unmistakably clear. As suggested earlier, the Legislature could simply have specified that the trial court was to weigh the available evidence and independently determine whether the plaintiff is more likely than not to prevail, win, or obtain a favorable judgment at trial. (Cf., e.g., §§ 405.3 [probable validity in lis pendens law means claimant is more likely than not to obtain judgment], 631.8, subd. (a) [court weighs evidence in nonjury trial].) The Legislature did not exercise that option. For the foregoing reasons, we find the language of section 425.13(a) ambiguous insofar as it purports to articulate a substantial probability of success standard for assessing the pleadability of punitive damage claims against health care providers. We must therefore interpret the section in a commonsense manner consistent with its underlying purpose. We identify such purpose by examining the statutory scheme of which section 425.13(a) is a part, as well as the legislative history of this statute. (See, e.g., Central Pathology, supra, 3 Cal.4th 181, 188.) Except insofar as it increased the burden of proof applicable in all punitive damage trials, nothing in the 1987 Reform Act indicates that the Legislature intended to change the substantive elements of punitive damage claims against health care providers or otherwise narrow the class of plaintiffs entitled to recover such damages. The Legislature could have amended Civil Code section 3294 to reflect such changes in medical malpractice actions, but it did not do so. When adding section 425.13(a) to the Code of Civil Procedure, the Legislature placed it near other statutes long used by courts to screen the legal sufficiency and triability of claims before trial. (See §§ 430.10 [demurrer], 436-437 [motion to strike], 437c [summary judgment].) Much like these other pretrial mechanisms, section 425.13(a) concerns the threshold question whether a claim can be pled by the plaintiff. By its own terms, section 425.13(a) requires the plaintiff to specially move to amend the complaint at a fairly early stage in the lawsuit. Discovery may not be complete at that time. Indeed, until a punitive damages claim is stated, discovery on some issues may not have begun. (See § 2017, subd. (a); Civ. Code, § 3295, subd. (c).) In apparent recognition of this fact, section 425.13(a) does not contemplate a minitrial in which witness testimony is introduced. As we have seen, a section 425.13(a) motion, like a motion for summary judgment, is decided entirely on an affidavit showing. (6) As indicated in Central Pathology, supra, 3 Cal.4th 181, section 425.13(a) was enacted amid concern over routine inclusion of sham punitive damage claims in medical malpractice actions. The statute apparently seeks to alleviate this problem by shifting to the plaintiff the procedural burden that would otherwise fall on the defendant to remove a frivolous or unsubstantiated claim early in the suit. (3 Cal.4th at pp. 189, 191.) Repeated references to section 425.13(a) appear in the legislative record of other statutes that were patterned upon it. Using similar terminology, these statutes seek to limit the pleadability of punitive, and even compensatory, causes of action under particular circumstances. The meaning of these other provisions is not technically before us, but we examine their history because it sheds light on the Legislature's intent with regard to section 425.13(a). Section 425.14 restricts the pleading of punitive damage claims against religious corporations by requiring the plaintiff to first substantiate the claim. It was enacted the year after section 425.13(a) became law. (Stats. 1988, ch. 1410, § 1, pp. 4778-4779; see Legis. Counsel's Dig., Sen. Bill No. 1, 4 Stats. 1988 (Reg. Sess.) Summary Dig., p. 489.) The letter transmitting the bill to the Governor for approval analogized section 425.14 to section 425.13(a), and described both provisions as providing procedural protection against frivolous claims while allow[ing] legitimate claims to be made. (Request for Signature Letter to Governor, from Sen. Com. Chairman John T. Doolittle, Sen. Bill No. 1 (1987-1988 Reg. Sess.) pp. 1-2.) Earlier, during the Assembly's consideration of section 425.14, the bill was said to establish essentially the same mechanism for pleading punitive damages as section 425.13(a). Both provisions were intended to prevent the automatic filing of punitive damage claims not supported by substantive proof. (Assem. Judiciary Com., Analysis of Sen. Bill No. 1 (1987-1988 Reg. Sess.) as amended Jan. 26, 1988, p. 1.) In the same session, the Legislature added section 1714.10 to the Civil Code. (Stats. 1988, ch. 1052, § 1, pp. 3407-3408.) Using language nearly identical to section 425.13(a), it requires plaintiffs to demonstrate a reasonable probability of success before charging an attorney with conspiracy during the course of representing a client. Both houses of the Legislature expressed concern over use of such claims as a tactical ploy, particularly in actions against insurance companies. The proposed legislation was described as a means of curbing such abuses while not unfairly depriv[ing] plaintiffs of legitimate conspiracy claims. (Sen. Com. on Judiciary, 3d reading analysis of Sen. Bill No. 2337 (1987-1988 Reg. Sess.) as amended August 9, 1988, p. 2; Assem. Subcom. on Admin. of Justice, Analysis of Sen Bill No. 2337 (1987-1988 Reg. Sess.) as amended May 11, 1988, p. 3.) One report recognized that motions for summary judgment were available to the defense as a means of defeating frivolous conspiracy claims. However, the report questioned whether such motions provided adequate procedural protection. (Sen. Com. on Judiciary, Analysis of Sen. Bill No. 2337 (1987-1988 Reg. Sess.), Hearing on May 3, 1988, p. 4.) Similar concerns surfaced in conjunction with sections 425.15 and 425.16, which were enacted as part of the same Senate bill in 1992. (Stats. 1992, ch. 726, §§ 1-2, pp. 1-4.) Section 425.15 prevents plaintiffs from filing negligence claims against certain nonprofit executives absent evidence substantiat[ing] the claim. Section 425.16 requires a probability of success as a precondition to maintaining so-called SLAPP suits. A Senate report indicated that both provisions were based on the need to screen out meritless cases at an early stage. (Sen. Com. on Judiciary, Analysis of Sen. Bill No. 1264 (1991-1992 Reg. Sess.) p. 5.) The same report ( ibid. ) also stated that [c]urrent uses of the pleading hurdle could be found in sections 425.13(a) and 425.14, and Civil Code section 1714.10. (3c) Nothing in the foregoing materials indicates that under statutes like section 425.13(a), trial courts are authorized to weigh the merits of the claim or consider its likely outcome at trial. Although such terms as frivolous and meritless are not explicitly defined, the tone and substance of the debate strongly suggest that the motion required by such statutes operates like a demurrer or motion for summary judgment in reverse. Rather than requiring the defendant to defeat the plaintiff's pleading by showing it is legally or factually meritless, the motion requires the plaintiff to demonstrate that he possesses a legally sufficient claim which is substantiated, that is, supported by competent, admissible evidence. Indeed, the Hospital's contrary interpretation of section 425.13(a) has grave implications. As we understand this view, a legally sufficient, factually supported punitive damages claim could be withheld from consideration by the trier of fact if the court independently concluded that the probability the claim would succeed at trial was not sufficiently high. We know of no other provision of law that empowers trial courts to trump the fact-finding process in this manner. If such an unusual and drastic result was intended by section 425.13(a), we would expect the Legislature to make that purpose abundantly clear. It did not do so. Thus, the gravamen of section 425.13(a) is that the plaintiff may not amend the complaint to include a punitive damages claim unless he both states and substantiates a legally sufficient claim. In other words, the court must deny the section 425.13(a) motion where the facts asserted in the proposed amended complaint are legally insufficient to support a punitive damages claim. (See §§ 430.10, 436-437.) The court also must deny the motion where the evidence provided in the supporting and opposing affidavits either negates or fails to reveal the actual existence of a triable claim. (See § 437c, subd. (c).) The section 425.13(a) motion may be granted only where the plaintiff demonstrates that both requirements are met. [5] This test is largely consistent with the prima facie approach formulated by the Courts of Appeal. [6] Moreover, in light of the affidavit requirement and by analogy to summary judgment practice, substantiation of a proposed punitive damages claim occurs only where the factual recitals are made under penalty of perjury and set forth competent admissible evidence within the personal knowledge of the declarant. (See §§ 437c, subds. (b) & (d), 2015.5.) Consistent with the legislative intent to protect health care defendants from the drastic effects of unwarranted punitive damage claims, the entire package of materials submitted in support of the section 425.13(a) motion should be carefully reviewed to ensure that a genuine contestable claim is indeed proposed. [7] The parties and amici curiae vigorously debate whether there is a state constitutional right to jury trial on a triable punitive damages claim (see Cal. Const., art. I, § 16), and whether section 425.13(a) interferes with such right. However, for reasons stated above, the statute does not alter the traditional role of the trier of fact with respect to punitive damage claims against health care providers. (See Evid. Code, § 312 [jury decides questions of fact].) As we interpret the statute, therefore, it does not implicate any jury trial concerns. (Accord, Bank of America, etc. v. Oil Well S. Co. (1936) 12 Cal. App.2d 265, 270 [55 P.2d 885] [summary judgment procedure].) Because resolution of the constitutional question is not necessary to our decision, we do not address it. ( De Lancie v. Superior Court (1982) 31 Cal.3d 865, 877, fn. 13 [183 Cal. Rptr. 866, 647 P.2d 142]; People v. Williams (1976) 16 Cal.3d 663, 667 [128 Cal. Rptr. 888, 547 P.2d 1000].)