A frivolous appeal

California Rule of Court 8.276 allows an appellate court to impose sanctions for "Taking a frivolous appeal or appealing solely to cause delay."

Occasionally -- but rarely -- an appeal is so weak that the appellate court that the court deems it "frivolous." Even rarer is a finding that an appeal was "solely to cause delay."

"Frivolity" can be determined objectively. Cases hold that an appeal is "frivolous" when any reasonable attorney would agree that the appeal is wholly without merit. So if you just read the appellant's briefs and the record, they should show how low the chance of a successful appeal is. No need to get into the heads of the lawyers who wrote them to try to figure out why they did it. A lawyer who sincerely believes that the appeal has merit might nevertheless file a brief that is so bad that it warrants the label "frivolous."

But "solely to cause delay" is subjective. It involves intent: Why did the appellant file the appeal? In some contexts, a subjective intent to delay might be inferred from an objective assessment of the merits. The briefs might be so weak that they must have been filed for some reason other than an expectation of reversal.

Aside from that inference, may an appellate court determine an appellant's -- or their counsel's -- actual intent to delay? That seems to go against what has always been accepted as the fundamental difference between trial and appellate courts. Trial courts find facts -- including the subjective intent of accused murderers and fraudsters. But appellate courts are not fact-finders. Unlike trial courts, they have no opportunity to watch the demeanor of people testifying and decide what motivated them to act as they did. Discerning an appellant's intent from paper filings is possible, theoretically, but not enough to change the basic rule that appellate courts avoid finding facts.

But that's what happened a few months ago, in Diaz v. Professional Community Management, Inc., 16 Cal. App. 5th 1190 (2017). The court of appeal sanctioned appellant's counsel for filing the appeal "solely for delay."

The appeal arose from a dispute between a tree trimmer (Diaz) and his former employer over whether the employer had sufficiently accommodated Diaz's alleged disabilities. After a year and a half of pretrial litigation, the employer moved for summary judgment, arguing that the parties' dispute was covered by a collective bargaining agreement that featured an arbitration provision. The trial court denied the employer's motion. (By that point, it was less than two weeks before trial.)

The employer immediately moved to compel arbitration. It also applied ex parte for an order expediting the trial court's ruling on the motion or, alternatively, postponing the trial date. The minute order from the ex parte hearing indicated that the judge denied the employer's ex parte application, refusing to shorten time for the hearing on the motion to compel arbitration or delay the trial so that the motion could be heard on regular notice.

But the minute order gave no indication that the judge had passed on the merits of the employer's motion to compel arbitration. Nor did it instruct either party to submit a proposed order. Nevertheless, the employer submitted to the court a proposed final order purporting to deny the motion to compel arbitration on the merits -- citing the same reasons on which the trial court had relied in denying the employer's summary judgment motion. The merits discussion, moreover, was buried in a proposed order captioned solely as a denial of the ex parte application.

The judge signed the proposed order. An order denying a motion to arbitrate is immediately appealable. Most significant in this case: filing the notice of appeal automatically stays the trial.

The employer appealed, thereby staying the trial.

On appeal, the employer challenged the trial court's denial of the motion to compel arbitration. After briefing was complete, the Court of Appeal gave notice it was considering sanctions against the employer, and ordered both sides to answer a series of questions regarding the circumstances leading to the appeal. The employer submitted supplemental briefs and declarations from both of its attorneys.

As the Court of Appeal acknowledged in its eventual opinion, this supplemental briefing mollified some of its concerns about the employer's litigation tactics. But the employer's explanations on appeal "effectively conceded engaging in conduct we were most disturbed by: i.e., they voluntarily sought an order denying their own motion [to compel arbitration], with the goal of generating pretrial appellate jurisdiction." Diaz, 16 Cal. App. 5th at 1196-97. Standing alone, that might not have been sanctionable, but under the circumstances, the Court of Appeal found that the employer's attorneys had engaged in "bad faith" and "intentionally misleading" conduct to obtain the appealable order. Id. at 1197, 1217.

To reach that result, the Court of Appeal took the highly unusual step of not only finding facts on appeal, but also making credibility determinations concerning counsel's representations that they had understood the trial judge to be passing on the merits of the motion. The court invoked Code of Civil Procedure Section 909, which permits appellate fact-finding in "cases where trial by jury is not a matter of right or where trial by jury has been waived." Applying a novel and quite expansive interpretation of the word "cases," the court decided that "cases" includes "specific matters on appeal, not the entirety of trial court litigation to which those appeals relate." Diaz, at 1213. That's not the most natural reading of the statute, but you can see why the court did what it did.

Diaz illustrates that a "frivolous" appeal is not always one that lacks merit on the underlying legal issues. Had the employer actually lost its motion to compel arbitration, it could have immediately appealed, and might have had a pretty good argument on the merits. But under the circumstances, it was clear that the employer's appeal was contrived "solely to cause delay." That meant the employer not only lost an otherwise colorable appeal on the merits -- the Court of Appeal found, based on counsel's tactics, that the employer could not force arbitration due to invited error and waiver -- it also got stuck with sanctions.