Colwell Co. v. Superior Court

California Court of Appeal Jul 21, 1975 No. Civ. 45803Published

Before: Ashby

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Holding. A trial court may properly bifurcate a class action to try the issue of liability before determining class issues when the defendant waives the protection of a judgment binding on all class members and requests such a procedure.

Issues

Whether a trial court may bifurcate a class action to try liability before class determination when the defendant requests it.
Whether Home Sav. & Loan Assn. v. Superior Court precludes a bifurcated trial where the defendant waives the protection against one-way intervention.

Disposition. remanded

Quotations verified verbatim against the opinion

“Home Savings does not preclude bifurcated trials where the defendant is willing to forego the protections against “one-way intervention.””

“Proceeding in a bifurcated trial and considering the liability issue first is proper when the defendant requests such a procedure.”

Opinion

ASHBY, J.

Petitioner (Colwell) is the defendant in a class action complaint brought by the real parties in interest (plaintiffs) on behalf of themselves and other persons similarly situated who in payment for the construction of mountain cabins executed lien contracts and deeds of trust which were assigned by the builders to Colwell. Colwell has purchased more than 1,800 contracts similar to those of plaintiffs, representing a total value in excess of $27 million.

In April 1973 Colwell made a motion to bifurcate the issues of class determination and liability in order to obtain an early trial on the issues of liability. The motion was made on the following grounds: (1) if the usual class action notice requirement were followed, the likelihood of

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Colwell’s continuing to receive payment on the contracts would be reduced and its business could be destroyed before the issue of liability could be resolved; (2) the goodwill and relationship of trust with builders in the mountain communities which has been established and presently exists could be immediately destroyed before the liability question could be determined; and (3) plaintiffs have asserted a theory of liability which is both novel and of doubtful validity.

Colwell and plaintiffs entered into a stipulation to bifurcate the trial and try the issue of liability prior to determining the class action issues. The trial court approved the stipulation and ordered the trial bifurcated on June 27, 1974. The matter was set for trial on October 21, 1974, but continued on the court’s own motion to January 16, 1975. The trial court on its own motion raised the question of whether the order for bifurcation was lawful and proper, and after hearing vacated that order on January 17, 1975. Colwell thereupon petitioned this court to compel the trial court to try the liability issue first in compliance with the original order for bifurcation.

The trial court in vacating the order of bifurcation considered itself compelled to do so by the decision in

Home Sav. & Loan Assn.

Superior Court,

Colwell Co. v. Superior Court

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ASHBY, J.

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