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August 21, 2009

Cabral v. Martins (2009)177 Cal.App.4th 471

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The First District holds that attorneys who provide legal services to family members allegedly trying to evade a child support judgment are entitled to anti-SLAPP protection from claims of the judgment creditor under child support enforcement statutes.

Tammy Cabral had a significant judgment against her ex-husband James Cabral for unpaid child support.  James’s mother Edwina Cabral hired Edward Martins to assist her in modifying her estate plan from one that divided her estate equally among her three children, Joseph, James and Mary to one that essentially disinherited James and left two-thirds of the estate to Mary and one-third to Joseph.  After Edwina’s death, Martins lodged her revised will with the probate court, and initiated proceedings to probate the will and to administer a related trust.

After Edwina died Tammy sued the Cabral family respondents, alleging various causes of action against them, including fraudulent transfer of James’s share of Edwina’s estate to Mary.  (Fraudulent Transfer Action I) James was represented by David Biasotti, and Mary and Joseph were represented by Martins and Valarie Follett.

Tammy also filed a will contest and a creditor’s claim in the probate proceedings relating to Edwina’s estate and a second separate fraudulent transfer action (Fraudulent Transfer Action II) against the Cabral family respondents, alleging essentially the same facts involved in Fraudulent Transfer Action I.  Mary and Joseph were represented as before by Martins and Follet and the action was stayed pending resolution of Fraudulent Transfer Action I and the will contest in the probate proceedings.  Michael Dougherty replaced Martins as counsel for Mary and Joseph in the probate proceedings.

Tammy sued the Cabral family a third time, and included their counsel, relying on essentially the same facts about James’s unpaid child support and the revision of Edwina’s estate plan premised on child support evasion statutes.  Each attorney filed a special motion to strike under California’s anti-Strategic Lawsuit Against Public Participation Statute (anti-SLAPP.) The court granted the motions and awarded the attorneys their attorneys’ fees.

Under the anti-SLAPP statute, the court makes a two-step determination.  First, the court decides whether the defendant has made a threshold showing that the challenged cause of action is one arising from protected activity.  If the court finds that such a showing has been made, it must then determine whether the plaintiff has demonstrated a probability of prevailing on the claim.

The Court of Appeal analyzed whether the plaintiff’s cause of action actually arose from the asserted protected activity, and if the activity was protected.  Tammy’s cause of action against the attorneys arose from their actions in revising Edwina’s estate plan, attempting to implement the revised plan through probate proceedings, and defending the Cabral family respondents in litigation initiated by Tammy.

It was clear that the probate proceedings and the litigation defense were protected petitioning activity for purposes of the anti-SLAPP statute.  All communicative acts performed by attorneys as part of their representation of a client in a judicial proceeding or other petitioning context are protected as petitioning activity by the anti-SLAPP statute.  The court rejected Tammy’s argument that it was not protected activity because it violated the child support evasion statutes.  Although a prior case had held that communications that constituted criminal extortion as a matter of law were not protected by the anti-SLAPP statute, that was limited to the specific and extreme circumstances of that case.  The attorneys’ actions in the course of the probate proceedings and the litigation defense were neither inherently criminal nor otherwise outside the scope of normal, routine legal services, even if the services had the effect of defeating or forestalling Tammy’s ability to execute her judgment for child support.  Conduct that would otherwise come within the scope of the anti-SLAPP statute does not lose its coverage because it is alleged to have been unlawful or unethical unless a defendant concedes, or the evidence conclusively establishes that the asserted protected speech or petition activity was illegal as a matter of law.

As for the will revision communications that are intimately intertwined with, and preparatory to, the filing of judicial proceedings qualify as petitioning activity for the purpose of the anti-SLAPP statute.  The will revision was of no effect until it was later implemented through the probate proceedings.  The will revision was also protected activity under the anti-SLAPP statute.  Alternatively, the will revision was only incidental to the subsequent protected activity, thus rendering Tammy’s entire cause of action subject to a special motion to strike.

Turning to the probability of prevailing, the court noted that that James’s expectancy as a probable heir of Edwina’s estate was not an “asset” belonging to James.  If the attorneys did no more than attempt to carry out Edwina’s wish to disinherit James there would be no reasonable possibility of success as to Tammy’s cause of action under the child support evasion statutes.  However, Tammy alleged that Edwina did not actually wish to disinherit James, but agreed with Mary that she would revise her estate plan so as to appear to give James’s share of the estate to Mary, on condition that Mary would, in turn, turn that money over to James in some fashion designed to prevent Tammy from enforcing the child support judgment against James’s inheritance.  If Tammy could establish the existence of the alleged agreement between Mary and Edwina then Tammy would be entitled to enforce the constructive trust against Mary.  Arguably Tammy could state a claim against the attorneys under the child support evasion statutes on the theory that in defending Mary against Tammy’s claims, they assisted Mary and James in hiding or transferring the money from Edwina’s estate that Mary agreed to hold in constructive trust for James.

However, such a claim would be subject to two dispositive defenses.  Martins’ actions in revising Edwina’s estate plan occurred prior to Edwina’s death and the child support evasion statutes were not enacted or become effective until over a year later.

More importantly, the attorneys’ subsequent actions in the probate proceedings and the litigation defense were all absolutely protected by the litigation privilege as codified in Civil Code § 47(b).

The Court rejected Tammy’s argument that the litigation privilege did not apply to actions that violate a specific statute.  In the debt collection setting, there are specific statutes governing debt collection activity that pre-empt the litigation privilege because those statutes would be negated in their entirety if the litigation privilege statute applied.  The application of the litigation privilege, however, would not entirely vitiate the child support evasion statutes.  The child support evasion statutes are aimed at such targets as employers who hire child support obligors without reporting their employment to the appropriate government authorities; individuals who procure goods or services from child support obligors by means of untraceable barter or cash transactions; and persons such as friends, relatives, and notaries public who assist child support obligors in attempting to conceal their assets by transferring legal title to them.  None of this wrong doing would be immunized by a holding that the litigation privilege provides a defense to actions under the child support evasion statutes.

Without the protection of the privilege, attorneys would be exposed to treble damages under the child support evasion statutes for garden variety attorney services such as estate planning for a child support obligor’s relative or defending a child support.  This would deter attorneys from representing child support obligors and those associated with them, thereby impairing the latter’s access to legal representation.

Comment: The anti-SLAPP statute is a powerful tool for protecting attorneys against third party claims for the routine services they provide their clients. 


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