Filed 4/29/14 Sohal v. P. ex rel. Dept. of Transportation CA3
                                          NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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           IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                                     THIRD APPELLATE DISTRICT
                                                        (Sutter)
                                                            ----




BALBIR SOHAL,                                                                           C073725

                   Plaintiff and Appellant,                             (Super. Ct. No. CVCS 12-1511)

         v.

THE PEOPLE ex rel. DEPARTMENT OF
TRANSPORTATION,1

                   Defendant and Respondent.




         Plaintiff Balbir Sohal filed this action seeking damages for an underlying
“[c]onstitutionally flawed” eminent domain action in which defendant Caltrans violated a



1 The caption of plaintiff’s complaint (utilized throughout the record) incorrectly
included the State of California as a separate defendant and suggested a second
defendant, California’s Department of Transportation (Caltrans), acted as the People’s
relator. We have adopted the correct designation as shown above, which plaintiff Sohal
now uses in his briefing on appeal.


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“special duty” through its wrongful conduct that resulted in an “improper payment” to
him; he also claimed entitlement to damages in inverse condemnation. Caltrans made a
special motion to strike the complaint. (Code Civ. Proc., § 425.16.)2 The trial court
granted the motion and entered a judgment of dismissal. After denying Sohal’s motion
for a new trial, the court awarded legal fees to Caltrans.

       Sohal appeals both from the judgment of dismissal and the order awarding legal
fees. However, he has not presented any argument regarding the latter (asserting in a
footnote that neither the right to legal fees nor the amount of the award is an issue on
appeal). Accordingly we will treat the latter appeal as abandoned and dismiss it. (In re
Sade C. (1996) 13 Cal.4th 952, 994.) As for his appeal from the judgment of dismissal,
Sohal contends in essence that the acts he alleged as “wrongful conduct” are analogous to
either legal malpractice or a breach of fiduciary duty, which are not proper subjects on
which to premise a special motion to strike. He also argues the evidence produced in
support of the special motion to strike (which he did not counter with any opposing
evidence) demonstrates a probability of prevailing at trial in establishing a breach of duty
and inverse condemnation. We do not find any of his arguments persuasive and shall
affirm the judgment of dismissal.

                  FACTUAL AND PROCEDURAL BACKGROUND

       We begin with the litigation that is the prelude to the present case.3
2007 Litigation (Super. Ct. Sutter County, No. CVCS 07-1309)

       In order to make improvements to Highway 99, Caltrans initiated condemnation
proceedings in 2007 against a 70-acre prune orchard that Sohal leased from the Darrell


2 Undesignated statutory references are to the Code of Civil Procedure.

3 We grant Caltrans’s motion to take judicial notice of matters in the prior case of which
the trial court took judicial notice and which are part of the record on appeal.


                                              2
and Jane Smith Family Partnership (the Partnership). Sohal had invested substantial
capital in the process of converting the land from rice fields to orchards in 1992, and as a
result obtained extremely favorable terms in his 25-year lease. After Caltrans took
possession in February 2008, there were 10 additional crop years remaining on the lease,
to which the property would have remained subject in the event the Partnership sold the
land. The right to condemn the property was not disputed; the parties proceeded to trial
solely on valuation.

         The only expert to testify at trial was the Partnership’s witness. He based his
valuation of Sohal’s interest exclusively on the favorable differential between the lease
terms and the market rate for the remainder of the lease (so-called “bonus rent”), which
he calculated at $93,000. (He valued the property as a whole at $700,000.) Although
two exhibits had calculated the present value of Sohal’s interest in his business over the
next 10 years at $1.2 million (rounded), the expert testified this was not attributable to
Sohal’s interest in the condemned property and thus did not affect his opinion of its
value.

         In presenting his case, Sohal accepted the expert’s valuation of his interest in his
lease. He sought additional compensation for his lost cash flow, based on the exhibits.
Caltrans and the Partnership moved for a directed verdict based on the expert’s valuation.
Sohal also moved for a directed verdict based on the cash flow exhibits. The trial court
granted a directed verdict to Caltrans and the Partnership and denied Sohal’s motion,
ruling that the expert had not endorsed the exhibits’ methodology and therefore the
exhibits could not be a proper basis for judgment because the finder of fact in an eminent
domain action can rely only on expert (or an owner’s) opinion of value and cannot itself
make a determination from the underlying evidence. The trial court thus entered
judgment in 2009 for $700,000, of which Sohal’s share was $93,000.




                                                3
       On appeal, we affirmed the judgment in a nonpublished opinion. (People ex. rel.
Department of Transportation v. Sohal et al. (Jan. 7, 2011, C063301).) We noted the just
compensation for a lessee had been limited traditionally to the outstanding bonus value of
the leasehold, and thus the directed verdict on this issue was correct because the evidence
was undisputed. We rejected Sohal’s argument that he was entitled to additional
compensation for his lost profits from future harvests. We noted that nothing
constitutionally requires compensation for loss of goodwill,4 so any right was purely
statutory. We concluded he failed to establish any of the necessary elements for lost
goodwill; his reliance on the cash flow exhibits without any expert testimony endorsing
them was insufficient. He failed to establish any authority on appeal to support his claim
that lost profits are otherwise a component of the constitutionally mandated just
compensation. The California Supreme Court denied review on March 16, 2011,
S190396. The United States Supreme Court denied a petition for a writ of certiorari in
October 2011 (sub nom. Sohal v. Darrell & Jane Smith Family Partnership et al. (2011)
___ U.S. ___ [181 L.Ed.2d 258]).
2012 Litigation (Super. Ct. Sutter County, No. CVCS 12-1511)
       Sohal initiated the present action in July 2012. As with a motion for summary
judgment, the allegations of the pleading frame the issues in a special motion to strike.
(Church of Scientology v. Wollersheim (1996) 42 Cal.App.4th 628, 654.) Shorn of
conclusory legal allegations, the complaint asserts some of the preceding underlying
circumstances and the following facts.




4 “Courts have long accepted that goodwill may be measured by the capitalized value
of the net income or profits of a business or by some similar method of calculating the
present value of anticipated profits.” (People ex rel. Dept. of Transportation v. Muller
(1984) 36 Cal.3d 263, 271.)


                                             4
       In the prior trial, it was uncontroverted that Sohal was unable to relocate, because
Caltrans failed to present any evidence of another available leasehold or his financial
ability to finance a relocation. Caltrans, aware that bonus rent was (in Sohal’s opinion)
an improper measure of just and equitable compensation as a result of this circumstance,
nonetheless pursued this litigation theory in the trial court and on appeal. Caltrans thus
failed to “own up to the particular procedural and substantive facts underpinning Sohal’s
property right” and instead relied on inapposite authority in support of its motion for a
directed verdict. Caltrans also incorrectly asserted in the litigation that the statutory right
to goodwill applied to Sohal; in his opinion, it is inapposite because he would have the
same single buyer regardless of his location and thus would not have diminished
“patronage.” This deceptive conduct contrasted with Sohal’s own forthright conduct, in
which he called attention to a $50,000 mistake in his favor. As a result of the conduct of
Caltrans, there was “an improper payment to the plaintiff.”

       In his government claims form appended to the complaint (which sought damages
in the amount of the cash flow exhibits), Sohal specified the following actions as
wrongful conduct. Caltrans made a challenge to the sufficiency of his expert disclosure
in a “studied and crafted manner” on technical grounds, and also challenged his proposed
testimony “as to . . . his . . . just and due compensation.” Caltrans was aware of his
inability to relocate and yet adhered to the theory of bonus rent, whereas the proper
standard required that he “be viewed as having occupied the property absent
condemnation and [entitled to] that which would have then flowed to him” as his
damages. Caltrans presented improper types of comparable property at trial. Although
his evaluation of his just compensation was in fact in evidence, Caltrans did not correct
the trial court (in connection with its motion for directed verdict) when the court stated
that Sohal had not presented any evidence or testimony on the point. Caltrans also
disregarded the uncontradicted evidence of his inability to relocate, which refuted the



                                               5
basis for the motion. Refusing to change its incorrect theories of the case, Caltrans
“allowed an incorrect position to be put forward” in this court and did not confess its
error5 in any responses to his petitions for rehearing, review, and certiorari.

       Caltrans demurred to the complaint. The trial court overruled the demurrer (the
actual order is not part of the record on appeal). Caltrans answered and made its special
motion to strike.

       In addition to the judicially noticed files of the prior litigation, the motion included
declarations from the attorneys who represented Caltrans in the prior litigation. These
made the self-evident point that all of the actions specified in the complaint occurred in
the course of a judicial proceeding, in connection with issues under the courts’ review,
to achieve the object of the Caltrans litigation. They also identified their objections to the
cash flow exhibits (or any testimony from Sohal based on them) as being premised on the
general inadmissibility of evidence of future business profits in an eminent domain
proceeding as speculative. (E.g., City of Stockton v. Albert Brocchini Farms, Inc. (2001)
92 Cal.App.4th 193, 198-199 [“Generally, a defendant may not present evidence of
income from a business that is conducted on the condemned property”].)

       Sohal’s opposition did not include any material exhibits. He explicitly conceded
that the conduct identified in the complaint was protected activity (“No argument about
that”) before proceeding to assert that this conduct was nonetheless akin to legal
malpractice or malicious prosecution, both of which he asserted are not subject to special
motions to strike (an incorrect assertion, as we later note, with respect to the latter).



5 This commences Sohal’s repeated evocations of the principle that an attorney is liable
for damages in an action for malicious prosecution for continuing to litigate an action
after discovering that it lacks probable cause (Zamos v. Stroud (2004) 32 Cal.4th 958,
970 (Zamos)), which he transmutes without explanation into a “duty” to adversaries to
“adjust and recalibrate their legal and factual positions.”


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       The trial court found Caltrans had established that its actions were protected
activity under the statute. The court also found that Sohal had not carried his burden of
producing any admissible evidence establishing a prima facie case in support of his
complaint. It therefore granted Caltrans’s special motion to strike.

                                       DISCUSSION

                                  I. Standards of Review

       In section 425.16, the Legislature created a process for piercing the pleadings
at an early stage of litigation (unlike a demurrer or an ordinary motion to strike) if the
defendant is able to demonstrate that its underlying conduct comes within one of the
categories of constitutional rights that the statute seeks to protect. (Simmons v. Allstate
Ins. Co. (2001) 92 Cal.App.4th 1068, 1073.) This requires us to determine if the alleged
acts underlying a cause of action “arise from” activity protected under section 425.16
(Vargas v. City of Salinas (2009) 46 Cal.4th 1, 14, 16, 20) and thus warrant the expedited
and summary evaluation of the merits of the action at the pleading stage (Graffiti
Protective Coatings, Inc. v. City of Pico Rivera (2010) 181 Cal.App.4th 1207, 1211).
Protected activity (which Sohal persists in describing as “permitted” activity) is an act in
furtherance of the rights to free speech and petition with respect to a public issue.
(§ 425.16, subds. (b)(1) & (e).) The focus is not the substance of a count but whether it is
premised on a protected act, rather than the act being only either a catalyst for the
litigation or evidence of liability. (Navellier v. Sletten (2002) 29 Cal.4th 82, 92; USA
Waste of California, Inc. v. City of Irwindale (2010) 184 Cal.App.4th 53, 62; Pico
Rivera, supra, 181 Cal.App.4th at p. 1215 [even though challenged speech assists in
telling the evidentiary story, claims are based on city’s duties under law to conduct
competitive bidding].)

       If a defendant satisfies this burden, the plaintiff must produce evidence sufficient
to establish a prima facie case of prevailing on the complaint. (Jarrow Formulas, Inc v.

                                              7
LaMarche (2003) 31 Cal.4th 728, 741 (Jarrow Formulas); Roberts v. Los Angeles
County Bar Assn. (2003) 105 Cal.App.4th 604, 613-614.) A plaintiff also bears the
burden of proof at this stage, which is akin to an opposition to motions for nonsuit,
directed verdict, or summary judgment. (Gilbert v. Sykes (2007) 147 Cal.App.4th 13,
26.) As with opposition to a summary judgment motion, a plaintiff may not rely on the
allegations of the complaint to oppose a special motion to strike, and instead must
produce competent admissible evidence. (Schoendorf v. U.D. Registry, Inc. (2002)
97 Cal.App.4th 227, 236.) A defendant, however, has the burden of proof to establish
an affirmative defense to the action. (Seltzer v. Barnes (2010) 182 Cal.App.4th 953, 969
(Seltzer).) We review a special motion to strike de novo. (Paul for Council v. Hanyecz
(2001) 85 Cal.App.4th 1356, 1364.)

                            II. Protected Conduct Is at Issue

       We will not belabor our analysis of the first step. The acts on which Sohal
premises his putative causes of action are quintessential examples of protected petitioning
activity. (See Kearney v. Foley & Lardner, LLP (9th Cir. 2009) 566 F.3d 826, 837
[condemnation action is petitioning activity on behalf of citizens to establish public use].)
His attempted analogy to the exclusion from the statute of otherwise protected petitioning
activities that result in malpractice falls flat. (Cf. Kolar v. Donahue, McIntosh &
Hammerton (2006) 145 Cal.App.4th 1532, 1540.) His is a third party claim against an
opponent’s attorney for litigation activities, which makes the principle in Kolar—
premised on an attorney’s duty to represent a client competently—utterly inapposite.
(Seltzer, supra, 182 Cal.App.4th at p. 968; see Kolar, at p. 1540.) The same is true of his
invocation of Castleman v. Sagaser (2013) 216 Cal.App.4th 481 as being “[s]omewhat
analogous.” It is not at all analogous, because it is premised on an attorney’s fiduciary
duty of loyalty to a client (id. at p. 493), which does not exist as to an adversary.
Although Sohal extracts from City of Los Angeles v. Decker (1977) 18 Cal.3d 860, 871,


                                              8
what he calls the “quasi-judicial obligation” on the part of government attorneys to their
adversaries to ensure the rendering of impartial justice,6 the case never suggests a breach
of this duty is independently actionable in tort; it simply reversed the judgment on the
basis of affirmative misconduct on the part of the condemnor’s attorneys in misleading
the jury with false argument. (City of Los Angeles v. Decker, supra, 18 Cal.3d at p. 871.)
He similarly fails to provide any authority for premising an independent action either on
the professional obligation to deal truthfully with adversaries and the courts (Bus. & Prof.
Code, § 6068, subd. (d)), or the right to damages for continued malicious prosecution
under Zamos, supra, 32 Cal.4th 958. Finally, while the gist of Sohal’s complaint is
indeed “somewhat” akin to an action for malicious prosecution (albeit with the significant
distinction that Caltrans prevailed rather than failed in its litigation against him), it is a
pointless analogy to urge because conduct resulting in malicious prosecution is subject to
a special motion to strike. (Jarrow Formulas, supra, 31 Cal.4th at p. 732.)

                         III. No Probability of Prevailing at Trial

       His complaint thus being properly subject to a special motion to strike, Sohal had
to establish a prima facie case in support of its allegations based on evidence. The only
evidence submitted with the motion were the Caltrans declarations, which Sohal
essentially adopted as his own. These declarations established that all the acts included
in the exhibit to the complaint were the litigation activities of the Caltrans attorneys in the
course of a judicial proceeding, which were related to the proceeding and authorized
under the law to achieve the object of the proceeding. This established conclusively that
the elements of the absolute litigation privilege of Civil Code section 47 applied to the
conduct. (Sylmar Air Conditioning v. Pueblo Contracting Services, Inc. (2004)


6 County of Santa Clara v. Superior Court (2010) 50 Cal.4th 35, 49 described the case
(and others) as representing the principle in the context of a “class of civil cases in which
counsel representing the government must be absolutely neutral.”


                                                9
122 Cal.App.4th 1049, 1058.) Absent some species of extrinsic fraud, it was plaintiff
Sohal’s burden in the course of the underlying litigation to expose any bias,
misrepresentation, or falsity on the part of Caltrans, and thus even fraudulent conduct on
the part of opposing counsel is not actionable. (Ibid.; Seltzer, supra, 182 Cal.App.4th at
p. 970; Home Ins. Co. v. Zurich Ins. Co. (2002) 96 Cal.App.4th 17, 28 (Home Ins. Co.)
[fraudulent misrepresentation of policy limits, which induced lower settlement, protected
under litigation privilege].) Sohal did not produce any evidence of extrajudicial acts on
the part of Caltrans that unknown to him prevented him from prevailing (such as
spoliation of evidence, which is not subject to the litigation privilege—Civ. Code, § 47,
subd. (b)(2)). As a result, even if he could premise some cause of action in tort on the
alleged conduct (a dubious concept that we do not need to explore further), the conduct
is absolutely privileged and he does not have any possibility of prevailing at trial.

       As for Sohal’s cause of action for inverse condemnation,7 his argument appears to
suggest the acts of the Caltrans attorneys in the underlying action erroneously depressed
the amount of the damages he recovered. However, Sohal has already had his day in
court on the issue of his entitlement to just damages for the premature termination of his
lease. That he claims to have been wrongly prevented from litigating his present theory
of compensation does not entitle him to disregard the basic precept that an issue actually
litigated, which is the subject of a final judgment, is binding in a subsequent proceeding
against the same party. “Our judicial system is intended for the resolution of disputes,
rather than their perpetuation through the ages.” (Weikel v. TCW Realty Fund II Holding
Co. (1997) 55 Cal.App.4th 1234, 1251.) Without finality of judgments, there would be


7 See City of Monterey v. Del Monte Dunes at Monterey, Ltd. (1999) 526 U.S. 687, 745-
748 [143 L.Ed.2d 882, 928-930] (conc. opn. of Souter, J.—discussing doubtful aptness of
treating inverse condemnation as a species of tort); cf. Holtz v. Superior Court (1970)
3 Cal.3d 296, 303 (basis for inverse condemnation damages not coextensive with tort
law).


                                             10
no stability in transactions, and thus the doctrine of res judicata “is the service rendered
by the courts” to society in furtherance of this interest. (Rest.2d Judgments (1982)
Introduction, p. 11.) While the principle is difficult for lay people (and some attorneys)
to appreciate, the importance to society of finality will generally transcend an individual’s
perception of an unjust result from an arguably incorrect application of the law; an
erroneous judgment is thus entitled to the same effect as any other. (People v. Cotton
Belt. Ins. Co. (1983) 143 Cal.App.3d 805, 808.)

       In modern terminology, res judicata has two aspects after a final judgment. Claim
preclusion prohibits subsequent litigation between the same parties on the same “cause of
action.” Issue preclusion operates as an estoppel against a losing party for issues actually
litigated and resolved in the prior final judgment. (Knickerbocker v. City of Stockton
(1988) 199 Cal.App.3d 235, 242; Rest.2d Judgments, supra, pp. 1, 4.) Even if we
entertain the unwarranted assumption that a different “primary right” is at issue in the
present litigation—making claim preclusion inapplicable (Pitts v. City of Sacramento
(2006) 138 Cal.App.4th 853, 857)—the value of the lease was an issue actually litigated
between the same parties and is now the subject of a final judgment.

       The only basis for avoiding issue preclusion would be allegations sufficient to
establish extrinsic fraud as a basis for disregarding the prior judgment. (In re Marriage
of Melton (1994) 28 Cal.App.4th 931, 937.) The “essence” of extrinsic fraud is one
litigant’s prevention of the other from properly litigating the case, either by keeping the
opponent in ignorance “or in some other manner” concealing a right from the opponent.
(Ibid.; see 8 Witkin, Cal. Procedure (5th ed. 2008) Attack on Judgment in Trial Court,
§ 225, p. 832.) This does not include suppressing material evidence, perjury, or even
presenting false documents; where litigants have an opportunity to protect their interests,
any misrepresentation on the part of an opponent is considered “intrinsic” and not a basis
for relief from the prior judgment. (Home Ins. Co., supra, 96 Cal.App.4th at p. 27.)


                                              11
Nothing prevented Sohal in the underlying case from making the same challenges to the
conduct of that litigation that he raises here. As a result, even if the litigation privilege
does not otherwise absolutely protect the Caltrans conduct at issue from liability, Sohal is
precluded from relitigating the issue of his compensation damages in the present action in
the guise of inverse condemnation.

                                       DISPOSITION

       The judgment of dismissal is affirmed. The appeal from the order awarding legal
fees is dismissed. Caltrans shall recover its costs on appeal. (Cal. Rules of Court, rule
8.278(a)(1), (2).)




                                                          BUTZ                   , Acting P. J.



We concur:



      MAURO                  , J.



      HOCH                   , J.




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