BILL ANALYSIS �
AB 2274
Page 1
Date of Hearing: May 8, 2012
ASSEMBLY COMMITTEE ON JUDICIARY
Mike Feuer, Chair
AB 2274 (Lara) - As Amended: March 29, 2012
As Proposed to be Amended
SUBJECT : VEXATIOUS LITIGANTS
KEY ISSUE : SHOULD THE VEXATIOUS LITIGANT STATUTE BE
STRENGTHENED AND EXPANDED TO COVER UNREPRESENTED PARTIES WHO
HAVE A LAWYER AT THE TIME AN ACTION IS FILED?
FISCAL EFFECT : As currently in print this bill is currently
keyed non-fiscal.
SYNOPSIS
This bill would expand and strengthen protections against
vexatious litigants - those who abuse the legal process by
repeatedly filing baseless civil actions. Sponsored by the
Civil Justice Association of California, the bill provides that
in any litigation filed in any court of this state by a
vexatious litigant subject to a pre-filing order who was
represented by counsel at the time of filing such litigation and
who became unrepresented after the withdrawal of his or her
attorney, if, after hearing evidence on the motion, the court
determines that the litigation has no merit and has been filed
for the purposes of harassment or delay, the court shall order
the litigation dismissed. The measure is supported by a
coalition of business groups who argue that it will reduce
harassing tactics and frivolous claims by removing a loophole in
protections afforded by the vexatious litigant statute. There
is no opposition.
SUMMARY : Extends the vexatious litigant statute to pro se
parties who had legal representation at the time of filing.
Specifically, this bill provides that in any litigation filed in
any court of this state by a vexatious litigant subject to a
prefiling order under section 391.7 who was represented by
counsel at the time of filing such litigation and who became in
propria persona after the withdrawal of his or her attorney, if,
after hearing evidence on the motion, the court determines that
the litigation has no merit and has been filed for the purposes
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of harassment or delay, the court shall order the litigation
dismissed.
EXISTING LAW :
1)Provides that a court may take specified actions with respect
to a vexatious litigant, as defined, including permitting a
court, on its own motion or the motion of any party, to enter
a pre-filing order that prohibits a vexatious litigant from
filing any new litigation in the courts of this state in
propria persona without first obtaining leave of the presiding
justice or presiding judge of the court where the litigation
is proposed to be filed. (Code of Civ. Pro. Section 391.7.)
2)Further provides that if after hearing the evidence upon the
motion the court determines that the plaintiff is a vexatious
litigant and that there is no reasonable probability that the
plaintiff will prevail in the litigation against the moving
defendant, the court shall order the plaintiff to furnish, for
the benefit of the moving defendant, security in such amount
and within such time as the court shall fix. (Code of Civ.
Pro. Section 391.3.)
COMMENTS : In support of the bill the author states:
The budget for California's judicial branch was reduced by
30% this past fiscal year, and since 2008 the budget has
been cut by nearly a quarter - $653 million. At the same
time, superior court filings have increased by 20%,
according to the Judicial Council's annual statistics
report. Additionally, in the current fiscal year, trial
court funding was cut by $350 million statewide. At a time
when courts are deeply impacted by these budget cuts, AB
2274 would limit abusive and frivolous lawsuits and filings
to save valuable resources of both the courts and the
parties. Although there are some provisions on the books
to protect against potentially abusive lawsuits brought
forward by vexatious litigants, unfortunately there are
still some instances in which litigants can use the court
system to pursue frivolous and unwarranted lawsuits. This
costs courts, which are already under enormous cost
pressure, and costs defendants precious time and money.
Once a person has been designated a vexatious litigant,
there are certain protections in future lawsuits brought
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forward by that person. One of the protections allows a
judge to look closely at what a vexatious litigant files
and approve of the filing. If a vexatious litigant has an
attorney, the litigant is not subject to the pre-filing
order or the scrutiny of the judge in his or her pleadings
because the attorney is subject to the Rules of
Professional Conduct.
A recent Supreme Court case found that the statute as
drafted only requires a vexatious litigant to have an
attorney at the initial filing of a case. AB 2274 would
clear up a loophole that currently exists in which a
vexatious litigant can dismiss the attorney after they file
papers and avoid the closer judicial scrutiny of their
case.
ARGUMENTS IN SUPPORT : A coalition of business groups writes in
support of the bill:
AB 2274 would reduce harassing tactics and frivolous claims
by removing a loophole in protections afforded by the
vexatious litigant statute.
Excessive and unnecessary lawsuits drive up business
expenses, cost government additional money, and increase
the cost of goods and services for all Californians.
Consumers pay for frivolous lawsuits as businesses increase
their prices to cover legal costs or shut down.
Additionally, employers cannot hire new employees or grow
their business when they are spending precious capital in
defending against meritless actions in litigation.
This bill allows legitimate claims to move forward, while
giving judges stronger tools to control vexatious
litigants. The existing vexations litigant statute was
enacted in order to curb frivolous litigation by
self-represented parties within California. A 'vexatious
litigant' designation requires a court to scrutinize an
individual's actions more closely based his or her past
egregious behavior creating a likelihood that harmful
conduct will continue to be used in ongoing legal
proceedings.
This increased scrutiny, i.e. a prefiling order, does not
apply when an attorney is present to represent the
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vexatious litigant because attorneys also scrutinize and
research claims. Unfortunately, vexatious litigants can and
do only retain attorneys at the initial filing of a case
and subsequently dismiss the attorney, thereby avoiding
this effective protection. Assembly Bill 2274 would remove
this loophole and allow judicial scrutiny when a vexatious
litigant becomes self-represented again. This bill would
return the effectiveness of the statutory protections and
clarify that the legislature did not intend to allow
vexatious litigants to so easily game the system.
This bill provides an important tool for both courts and
litigants to control unwarranted litigation, particularly
needed during these tough budget times.
Author's Clarifying Amendments. Reflecting input from the
Judicial Council, the author proposes to accomplish the purpose
of the bill somewhat differently but with equal effectiveness
and, it is hoped, better judicial economy. In place of the
current contents of the measure, the amendments substitute the
following:
The Code of Civil Procedure is amended to read as follows:
Section 391.1
In any litigation pending in any court of this state, at any
time until final judgment is entered, a defendant may move the
court, upon notice and hearing, for an order requiring the
plaintiff to furnish security or, as provided in section
391.3(b), for an order dismissing the litigation . The motion
must be based upon the ground, and supported by a showing, that
the plaintiff is a vexatious litigant and that there is not a
reasonable probability that he will prevail in the litigation
against the moving defendant. � 391.1.
Section 391.2.
At the hearing upon such motion the court shall consider such
evidence, written or oral, by witnesses or affidavit, as may be
material to the ground of the motion. Except for an order
dismissing the litigation under section 391.3(b), n o
determination made by the court in determining or ruling upon
the motion shall be or be deemed to be a determination of any
issue in the litigation or of the merits thereof.
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Section 391.3.
(a) Except as provided in subdivision (b), i f, after hearing
the evidence upon the motion, the court determines that the
plaintiff is a vexatious litigant and that there is no
reasonable probability that the plaintiff will prevail in
the litigation against the moving defendant, the court shall
order the plaintiff to furnish, for the benefit of the
moving defendant, security in such amount and within such
time as the court shall fix.
(b) In any litigation filed in any court of this state by a
vexatious litigant subject to a prefiling order under
section 391.7 who was represented by counsel at the time of
filing such litigation and who became in propria persona
after the withdrawal of his or her attorney, if, after
hearing evidence on the motion, the court determines that
the litigation has no merit and has been filed for the
purposes of harassment or delay, the court shall order the
litigation dismissed .
(c) A moving defendant may seek relief in the alternative
under either subdivision (a) or subdivision (b) and shall
combine all grounds for relief in one motion.
Section 391.6.
Except as provided in 391.3(b), w hen a motion pursuant to
Section 391.1 is filed prior to trial the litigation is stayed,
and the moving defendant need not plead, until 10 days after the
motion shall have been denied, or if granted, until 10 days
after the required security has been furnished and the moving
defendant given written notice thereof. When a motion pursuant
to Section 391.1 is made at any time thereafter, the litigation
shall be stayed for such period after the denial of the motion
or the furnishing of the required security as the court shall
determine.
REGISTERED SUPPORT / OPPOSITION :
Support
Civil Justice Association of California (sponsor)
Association of California Insurance Companies Property
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California Chamber of Commerce
California Grocers Association
California Farm Bureau Federation
Casualty Insurers Association of America
Citizens Against Lawsuit Abuse
Opposition
None on file
Analysis Prepared by : Kevin G. Baker / JUD. / (916) 319-2334