In an effort to ease overburdened courts and with an eye toward streamlining the initial phase of civil litigation, the California Legislature has enacted amendments to the rules in the California Civil Procedure Code relating to demurrers (California’s version of the motion to dismiss). These new rules require parties to, among other things, meet and confer in advance of the filing of a demurrer. The new statute, California Civil Procedure Code Section 430.41, took effect on January 1, 2016, and is subject to a five-year sunset provision.
Prior to filing a demurrer (and any subsequent demurrers) in a lawsuit, the demurring party is now required to meet and confer in person or by telephone with the opposing party for the purpose of determining whether an agreement can be reached to resolve the objections to be raised on demurrer. Specifically, the demurring party must identify the causes of action subject to demurrer and provide with legal support the basis of the deficiencies. The opposing party must respond in kind, identifying with legal support why the pleading is legally sufficient. If the parties are unable to reach a resolution, the demurring party must submit a declaration with its demurrer attesting that the meet and confer took place (or explaining why it did not).
The meet and confer must occur at least five days before the demurrer is due. However, the demurring party is entitled to an automatic 30-day extension of time to file a responsive pleading if it files a declaration explaining why the parties were unable to timely meet and confer. Moreover, any determination by the court that the meet and confer process was insufficient shall not be grounds to overrule or sustain a demurrer.
The new law also limits the number of times a party may amend its pleading. Absent an offering of new facts to be pleaded, a complaint or cross-complaint may not be amended more than three times. Importantly, though, the three-amendment limit does not include amendments made without leave of court, e.g., made as a matter of right in response to a demurrer. Thus, it is possible—if not likely—that plaintiffs will have up to four opportunities to plead facts sufficient to state a cause of action.
Another important change concerns the demurring party’s ability to raise new arguments in subsequent demurrers. If a party demurs to an amended pleading following a successful demurrer, that party is prohibited from demurring to any portion of the amended pleading on grounds that could have been raised by demurrer to the earlier version of the pleading. This means that parties must take care to assert all viable arguments in their first demurrer, or those arguments will be waived.
As part of the same bill that added Section 430.41, the Legislature also amended California Civil Procedure Code Section 472(a). Amended Section 472(a) now provides that a pleading may be amended once without leave of court before an answer or demurrer is filed or before the demurrer is heard if the amended pleading is filed no later than the date the opposition to the demurrer is due. (The prior rule provided that an amendment could be filed at any time up to the hearing of the demurrer).
Supporters of the new law argue that it will decrease the large number of demurrers now filed with the trial courts and thus reduce the delays associated with overburdened courts. They contend that if counsel are required to meet and confer, many pleading issues can be resolved without resort to motion practice.
Opponents of the law argue that it will actually result in more delays to resolving baseless claims primarily because it lacks any mechanism to hold attorneys or their clients accountable for either failing to meet and confer in good faith or failing to meet at all.
Perhaps more significantly, opponents argue that the new law is unfairly one-sided because it provides plaintiffs and cross-complainants up to four opportunities to come up with a legally sufficient pleading, whereas demurring parties are prohibited from raising new arguments in subsequent demurrers if those arguments could have been made against the earlier pleading.
It will be interesting to see what effect, if any, the new law will have on the courts and on litigants. Cynics might say that without the threat of sanctions it is unlikely that the new law will have much effect on parties and counsel who typically bring broad, boilerplate complaints because there is little to no downside for plaintiffs to take their chances with the court. For those optimists out there, the new requirements should—at a minimum—push parties at the initial stages of litigation to truly think through and discuss their case’s respective strengths and weaknesses, which in turn could lead to more early resolutions.
For further information regarding California Civil Code Section 430.41, please contact Andrew S. Elliott at ase@severson.com.