Dee ROWE, et al., Petitioners,
v.
The SUPERIOR COURT of Los Angeles County, Respondent;
CHURCH OF SCIENTOLOGY OF ORANGE COUNTY, etc., et al., Real Parties in Interest.
No. B070406.
Court of Appeal, Second District, Division 3, California.
May 25, 1993.
Plaintiff sought writ of mandate to review order of the Superior Court, Los
Angeles County, No. BC038955, Paul Flynn, J., which denied motion to amend
complaint to assert claim for punitive damages against religious organization.
The Court of Appeal, Croskey, J., held that: (1) statute setting forth
threshold for pleading claim of punitive damages against religious organization
requires only that plaintiff demonstrate existence of sufficient evidence to
establish a prima facie case for punitive damages, with the court engaging in
no weighing plaintiff's evidence against defendant's evidence; (2) as so
construed, statute does not violate constitutional right to jury; and (3)
statute does not violate establishment clause.
Alternative writ discharged and peremptory writ issued.
[1] JURY
Seventh Amendment only guarantees federal right to jury trial in civil cases,
and is not binding on the states. U.S.C.A. Const.Amend. 7; West's
Ann.Cal. Const. Art. 1, s 16.
[2] JURY
Claims for intentional torts, including punitive damages, are of type to which
right to jury trial attaches. West's Ann.Cal. Const. Art. 1, s 16.
[3] JURY
If statute setting forth threshold requirement for pleading punitive damages
against religious organization were construed to require trial judge to weigh
evidence on both sides and only permit the filing of claim for punitive damages
if the court finds that plaintiff will prevail, right to jury trial would be
clearly violated. West's Ann.Cal. Const. Art. 1, s 16; West's
Ann.Cal.C.C.P. s 425.14.
[4] STATUTES
Where statutory language is clear and ambiguous, there is no need for
construction.
[5] CONSTITUTIONAL LAW
Court is required to resolve any ambiguity in statute in manner which is
consistent, not inconsistent, with constitutional rights.
[6] JURY
Statute setting forth threshold requirement for pleading punitive damages
against religious organization requires only that plaintiff demonstrate the
existence of sufficient evidence to establish prima facie case of punitive
damages, and trial court is not required to make any factual determination or
to become involved in any weighing process beyond that necessarily involved in
deciding whether prima facie case for punitive damages exists and, as so
construed, statute does not violate right to jury trial. West's Ann.Cal.
Const. Art. 1, s 16; West's Ann.Cal.C.C.P. s 425.14.
[7] CONSTITUTIONAL LAW
Benevolent neutrality required by First Amendment involves delicate balance
between avoidance of sponsorship on one hand and interference on the other.
U.S.C.A. Const.Amend. 1.
[8] CONSTITUTIONAL LAW
Establishment clause is made applicable to the states through the Fourteenth
Amendment. U.S.C.A. Const.Amends. 1, 14.
[9] CONSTITUTIONAL LAW
Establishment clause was intended to protect against sponsorship, against
financial support of religion by civil government, and against active
involvement of sovereign in religious activity. U.S.C.A. Const.Amend. 1.
[10] CONSTITUTIONAL LAW
Grant of benefit to religious organization is permissible if it has a valid
secular purpose, if it does not have primary effect of advancing religion or
any particular religious sect, and if it does not foster excessive government
entanglement in religion. U.S.C.A. Const.Amend. 1.
[11] CONSTITUTIONAL LAW
Validity of any particular benefit to religion depends upon whether benefit
constitutes accommodation of religion or is an impermissible advancement.
U.S.C.A. Const.Amend. 1.
[12] CONSTITUTIONAL LAW
Statute setting forth threshold requirement for pleading of punitive damages
against religious organization meets the Lemon criteria and does not violate
establishment clause. U.S.C.A. Const.Amend. 1; West's Ann.Cal.C.C.P. s
425.14.
[12] RELIGIOUS SOCIETIES
Statute setting forth threshold requirement for pleading of punitive damages
against religious organization meets the Lemon criteria and does not violate
establishment clause. U.S.C.A. Const.Amend. 1; West's Ann.Cal.C.C.P. s
425.14.
[13] CONSTITUTIONAL LAW
Where subject is legislation which seeks to advance free exercise values, rigid
application of Lemon criteria is not appropriate for determining whether it
violates the establishment clause. U.S.C.A. Const.Amend. 1.
[14] CONSTITUTIONAL LAW
Broad class of institutions and organizations benefitted by statute which also
benefits religious organizations is not essential for establishing a proper
purpose for benefit to religious organization, and it is not required that the
benefits to religion come packaged with benefits to secular entities.
U.S.C.A. Const.Amend. 1.
[15] CONSTITUTIONAL LAW
Requirement that statute which benefits religion have secular purpose does not
amount to requirement that the law's purpose be unrelated to religion.
U.S.C.A. Const.Amend. 1.
[16] CONSTITUTIONAL LAW
To facilitate benevolent neutrality toward religion, government may make
accommodations to religion without violating the establishment clause.
U.S.C.A. Const.Amend. 1.
[17] CONSTITUTIONAL LAW
Laws discriminating among religions are subject to strict scrutiny, but laws
which afford uniform benefit to all religions are upheld if rationally related
to the furtherance of a legitimate end, and are found invalid only if wholly
motivated for impermissible purpose. U.S.C.A. Const.Amend. 1.
[18] APPEAL AND ERROR
Issue which was arguably raised in the trial court but which was not briefed or
argued on appeal was waived.
[18] APPEAL AND ERROR
Issue which was arguably raised in the trial court but which was not briefed or
argued on appeal was waived.
[19] APPEAL AND ERROR
Where it appeared that court imposed improper standard in determining adequacy
of pleading of punitive damages against religious organization, remand was
required for court to reconsider the issue under proper standard. West's
Ann.Cal.C.C.P. s 425.14.
[20] MOTIONS
Party seeking to comply with requirements for asserting punitive damage against
religious organization should be able to do so at any time that there is
sufficient evidence available to make the required prima facie showing, and
party thus should be free to renew a properly denied motion upon subsequent and
timely discovery of additional evidence. West's Ann.Cal.C.C.P. s 425.14.
[20] RELIGIOUS SOCIETIES
Party seeking to comply with requirements for asserting punitive damage against
religious organization should be able to do so at any time that there is
sufficient evidence available to make the required prima facie showing, and
party thus should be free to renew a properly denied motion upon subsequent and
timely discovery of additional evidence. West's Ann.Cal.C.C.P. s 425.14.
**626 *1715 Cummins & White, Barry Van Sickle, Richard J. Wynne and Toby
L. Plevin, Los Angeles, for petitioners.
No appearance for respondent.
Rabinowitz, Boudin, Standard, Krinsky & Lieberman, Eric M. Lieberman, Hillary
Richard, New York City, Bowles & Moxon, Karen D. Holly and Laurie J. Bartilson,
Hollywood, for real parties in interest.
CROSKEY, Associate Justice.
Petitioners Dee Rowe and S. Glover Rowe (collectively "Rowe") seek a
writ of **627 mandate to overturn the trial court's refusal to permit the
amendment of Rowe's complaint against the Church of Scientology of Orange
County ("Scientology") [FN1] to allege a claim for punitive damages. Such pre-
pleading permission by the court is a requirement imposed by Code of Civil
Procedure section 425.14. [FN2] Rowe attacks this legislation by asserting
that it is unconstitutional on the grounds that it violates (1) California's
constitutional guarantee of a jury trial and (2) the establishment clause of
the First Amendment to the United States Constitution. We conclude that Rowe
is incorrect on both points. However, because it appears that the trial court
*1716 may not have applied the proper standard in evaluating Rowe's proposed
amended pleading, we grant the writ.
FN1. Church of Scientology International, Religious Technology Center and
Sea Organization were also named as defendants in Rowe's complaint. For
purposes of this opinion there is no reason to distinguish between them and
they are all embraced within the term "Scientology."
FN2. Unless otherwise noted, all further statutory references are to the
Code of Civil Procedure.
Section 425.14 provides:
"No claim for punitive or exemplary damages against a religious corporation
or religious corporation sole shall be included in a complaint or other
pleading unless the court enters an order allowing an amended pleading that
includes a claim for punitive or exemplary damages to be filed. The court
may allow the filing of an amended pleading claiming punitive or exemplary
damages on a motion by the party seeking the amended pleading and upon a
finding, on the basis of the supporting and opposing affidavits presented,
that the plaintiff has established evidence which substantiates that
plaintiff will meet the clear and convincing standard of proof under
Section 3294 of the Civil Code. [P] Nothing in this section is intended
to affect the plaintiff's right to discover evidence on the issue of
punitive or exemplary damages."
FACTUAL AND PROCEDURAL BACKGROUND
On October 3, 1991, Rowe filed a complaint against Scientology alleging claims
for fraud, false imprisonment, assault, intentional infliction of emotional
distress, invasion of privacy and deceptive trade practices. The allegations
arose out of a relationship which began with a management and consulting
contract between Rowe and a company known as Sterling Management Systems
("Sterling") which Rowe claims was a Scientology "front group." This contract
related to Rowe's Alabama dental practice. Subsequently, Rowe alleges,
Sterling recruited Rowe to enroll and participate in counseling programs at
Scientology's Orange County facility located in Tustin, California.
There is no need to recite in detail the factual allegations concerning
Scientology's claimed misconduct. It is sufficient to note that Rowe's
complaint charged six separate intentional torts each of which was alleged to
have been committed with malice and oppression. Based on such allegations,
Rowe sought recovery of punitive damages.
Scientology responded with a motion to strike Rowe's allegations and prayer
for punitive damages on the ground that Rowe had not complied with the
requirement of section 425.14 to first obtain leave of court before seeking
such relief. On December 11, 1991, the trial court granted the motion. [FN3]
FN3. Rowe sought a writ of mandate from this court with respect to such
order, claiming that section 425.14 violated the establishment clause of
the First Amendment of the United States Constitution. On February 26,
1992, we denied Rowe's petition without prejudice "to the filing of a
motion to amend the complaint in the court below."
Thereafter, Rowe made a motion for leave to amend the complaint to allege a
prayer for punitive damages. In support of the motion, Rowe filed three
declarations and documentary material apparently copied from certain
Scientology publications. In addition, Rowe argued that section 425.14
violated two constitutional guarantees: (1) the right to a jury trial under
both the United States and California constitutions and (2) the establishment
clause of the First Amendment.
Scientology opposed this motion with excerpts from depositions of Rowe and
certain documentary evidence together with legal argument regarding the
admissibility of Rowe's evidence and a response to the **628 constitutional
*1717 questions raised. Scientology concluded its opposition with arguments
which bear upon the issue before us: "... the only evidence submitted by
plaintiffs in support of their pending motion consists of the declarations of
Dee Rowe and S. Glover Rowe. As demonstrated ... those declarations do not
satisfy the Rowe's burden of establishing their claim for punitive damages by
clear and convincing proof"; and later, "the evidence offered by [Rowe] not
only is not 'clear and convincing,' it is largely inadmissible. Analysis of
the remaining admissible evidence pursuant to s 425.14 reveals that
plaintiffs have failed to meet the clear and convincing standard, or any lesser
standard for that matter." [FN4]
FN4. This argument in effect assumes that section 425.14 imposes a
requirement that Rowe must satisfy the court of ultimate success on the
punitive damage issue before a pleading will be permitted. Such
construction of the statute finds an echo in the trial court's own
ruling. (See fn. 6, post.) As we point out below, to construe the statute
in this manner would result in an unconstitutional impairment of the right
to a jury trial.
On September 22, 1992, the motion came on for hearing. The trial court
rejected Rowe's constitutional arguments with little or no discussion [FN5] and
then heard extensive argument as to whether Rowe had satisfied the "clear and
convincing" pre-pleading hurdle of section 425.14. After considering the
competing declarations and evidence before it the court denied Rowe's motion.
In describing the conclusion which it reached it appears that the court was of
the opinion that section 425.14 required Rowe to demonstrate evidence
sufficient to satisfy the clear and convincing standard and that, after
weighing the evidence before it, the court concluded that Rowe had failed to
meet that burden. [FN6] Rowe's motion was therefore denied.
FN5. Although the record is not entirely clear, it appears that these
issues were considered and denied on their merits. The record reflects the
following colloquy with the Court:
"The Court: I suppose the first issue that is raised is that CCP 425.14
is unconstitutional.
"Ms. Plevin: Yes, Sir.
"The Court: I am not in a position to declare 425.14 unconstitutional.
The Legislature deemed in its wisdom appropriate to legislate and that's
what they did when they enacted 425.14.
"As far as that claim is concerned, that does not sway the court.
"Ms. Plevin: May I ask, are you ruling then as to the issue regarding the
constitutionality of 425.14 both on the 7th amendment issue and the 1st
Amendment issue?
"The Court: Yes, you can take that to the bank and do whatever you want
with it, but I am not in a position to make a determination that 425.14 is
unconstitutional. Either as violative of the 7th Amendment, the right to
freedom of religion--what are the other constitutional claims that you base
your arguments on? Portions of the constitution?
"Ms. Plevin: Jury trial and establishment cause.
"The Court: Under both of those clauses, I am not going to declare 425.14
unconstitutional. You are just basing it on federal constitution?
"Ms. Plevin: California as well.
"The Court: All right."
FN6. The trial court announced its decision, and the reasoning on which it
was based, in the following terms:
"The Court: I've reviewed the somewhat conclusionary declarations of the
Rowes' and I must admit I have reviewed the depositions on other occasions
as well as now with respect to prior hearings.
"And there is a marked contrast between that which is contained in the
depositions with respect to these allegations as far as claims for punitive
damages are concerned, claims for punitive damages are concerned.
"There is quite a disparity between that which is in the declarations and
that which is in the depositions, and leaves me with a view that--I have to
have before me in order to grant relief under section 425.14, I have
to have, in my view, clear and convincing proof, unequivocal, the kind of
proof that will leave no substantial doubt.
"The kind of proof that is sufficiently strong to command the unhesitating
assertion of every reasonable mind that indeed there was this despicable
conduct that would call for the issue of punitive damages to be placed
before the jury.
"I have a hard time in just reviewing the affidavits alone, concluding that
the information there rises to the level of convincing the court by clear
and convincing evidence that there was fraud, oppression, malice, of the
quantity that would warrant adding on the punitive damages claim. There is
a doubt.
"Therefore, I'm going to deny the motion for leave to allow the prayer for
punitive damages based upon that view...." (Emphasis added.)
*1718 Rowe then brought the instant petition for writ of mandate. We
issued an **629 alternative writ and set the matter for hearing.
ISSUES PRESENTED
Rowe asserts that the trial court's order, which prevented the pleading of any
punitive damage claim, resulted from the operation of section 425.14, which
Rowe claims is unconstitutional. Therefore, Rowe argues, issuance of a writ of
mandate compelling the trial court to vacate its order is warranted. Rowe
asserts that section 425.14 is unconstitutional on two grounds: first, it
requires the trial court to weigh evidence and decide the issue of entitlement
to punitive damages, thus depriving Rowe of the constitutionally protected
right to a jury trial; and second, it creates an impermissible benefit for
religious organizations and thus violates the establishment clause of the First
Amendment.
We discuss each of these claims in turn.
DISCUSSION
1. Section 415.14 Does Not Impair the Right to a Jury Trial.
[1] Article I, section 16 of the California Constitution provides in
pertinent part, "Trial by jury is an inviolate right and shall be secured to
all,...." [FN7] "In California, the constitutional right to a jury trial in
civil cases is coextensive with the right as it existed under the common law of
*1719 England in 1850, when the California Constitution was adopted.
[Citation.] ' "The right has always been regarded as sacred and has been
jealously guarded by the courts. [Citation.]" ' [Citation.] It is the
function of the jury to determine questions of fact. [Citations.]" (Hung
v. Wang (1992) 8 Cal.App.4th 908, 927, 11 Cal.Rptr.2d 113.)
FN7. Rowe also relied in the trial court upon the Seventh Amendment to the
United States Constitution. However, the Seventh Amendment only guarantees
a federal right to a jury trial in civil cases and is not binding on the
states. (Jehl v. Southern Pacific Co. (1967) 66 Cal.2d 821, 827, 59
Cal.Rptr. 276, 427 P.2d 988.) Therefore, we confine our discussion to the
impact of the provisions of the California Constitution.
[2][3] There is no question or dispute in this case that the claims asserted
by Rowe, including the claim for punitive damages, are of the type to which the
jury trial right attaches. [FN8] The question which we must address is
whether section 425.14 in any way impairs that right. If we construe the
statute to require the trial judge to weigh the evidence on both sides and only
permit the filing of a claim for punitive damages if the court finds that Rowe
will prevail, then Rowe's jury right would be clearly violated.
FN8. The resolution by jury of punitive damage claims was firmly a part of
the common law by the time of the adoption of the California Constitution.
As the United States Supreme Court recently put it, " 'It is a well-
established principle of the common law, that in actions of trespass and
all actions on the case for torts, a jury may inflict what are called
exemplary, punitive or vindictive damages upon a defendant, having in view
the enormity of his offense rather than the measure of compensation to the
plaintiff.... [P] This has always been left to the discretion of the jury,
as the degree of punishment to be thus inflicted must depend on the
peculiar circumstances of each case.' [Citation.]" (Pacific Mut. Life
Ins. Co. v. Haslip (1991) 499 U.S. 1, ---- [111 S.Ct. 1032, 1042, 113
L.Ed.2d 1], quoting from Day v. Woodworth (1852) 54 U.S. (13 How.) 363,
371, 14 L.Ed. 181.)
a. Section 425.14 Is Ambiguous
[4] We look first to the plain language of the statute. Where statutory
language is clear and unambiguous there is no need for construction. (Rojo
v. Kliger (1990) 52 Cal.3d 65, 73, 276 Cal.Rptr. 130, 801 P.2d 373.) The
critical statutory language here involved reads, "... the court may allow the
filing of an amended pleading claiming punitive or exemplary damages on a
motion by the party seeking the amended pleading and upon a finding, on the
basis of the supporting and opposing affidavits presented, that the plaintiff
has established evidence which substantiates that plaintiff will meet the clear
and convincing standard of proof under section 3294 of the Civil Code."
(Emphasis added.)
Is this language clear and free from ambiguity? We begin our analysis
of that question by examining the nature of the burden which this imposes on a
pleading party. On the surface, it appears to be a different burden, if not a
greater one, than that which is imposed by section 425.13 which contains a
related pleading hurdle with respect to punitive damage claims **630 against
health care providers. That section provides in pertinent part, "... The
court *1720 may allow the filing of an amended pleading claiming punitive
damages on a motion by the party seeking the amended pleading and on the basis
of the supporting and opposing affidavits presented that the plaintiff has
established that there is a substantial probability that the plaintiff will
prevail on the claim pursuant to Section 3294 of the Civil Code." (Emphasis
added.) [FN9] No citable decision has yet analyzed this pleading hurdle for
clarity or meaning. [FN10]
FN9. There are at least two other statutory provisions where the
Legislature has created similar hurdles to the pleading or proof of
particular claims. Each uses language similar to s 425.13:
(1) Civil Code section 1714.10, subdivision (a), where the term
"reasonable probability" is utilized:
"No cause of action against an attorney for a civil conspiracy with his or
her client arising from any attempt to contest or compromise a claim or
dispute, and which is based upon the attorney's representation of the
client, shall be included in a complaint or other pleading unless the court
enters an order allowing the pleading that includes the claim for civil
conspiracy to be filed after the court determines that the party seeking to
file the pleading has established that there is a reasonable probability
that the party will prevail in the action...." (Emphasis added.)
The legislative history of Civil Code section 1714.10, subdivision (a),
reveals that its similarity to section 425.13 is more than coincidental;
it was patterned after that section. (Hung v. Wang, supra, 8
Cal.App.4th at p. 934, fn. 6, 11 Cal.Rptr.2d 113.)
(2) Civil Code section 3295, subdivision (c), relating to restrictions
on the pretrial discovery of a defendant's financial condition except upon
a "substantial probability" showing:
"No pretrial discovery by the plaintiff shall be permitted with respect to
[evidence of defendant's "profits" from the alleged wrongful conduct or the
defendant's "financial condition"] unless the court enters an order
permitting such discovery pursuant to this subdivision.... [P] Upon motion
by the plaintiff supported by appropriate affidavits and after a hearing,
if the court deems a hearing to be necessary, the court may at any time
enter an order permitting the discovery otherwise prohibited by this
subdivision if the court finds, on the basis of the supporting and opposing
affidavits presented, that the plaintiff has established that there is a
substantial probability that the plaintiff will prevail on the claim
pursuant to Section 3294...." (Emphasis added.)
FN10. In College Hospital Inc. v. Superior Court (Laura C.) (1993) 13
Cal.App.4th 1193, 16 Cal.Rptr.2d 833, the court construed section 425.13 by
applying the reasoning of the Hung court (see below) notwithstanding the
slight difference in language utilized in Civil Code, section 1714.10,
subdivision (a). However, on May 13, 1993, the California Supreme Court
granted review.
However, similar language used in Civil Code section 1714.10 has recently
been examined and found to be ambiguous. (Hung v. Wang, supra, 8
Cal.App.4th at p. 930, 11 Cal.Rptr.2d 113.) More than one reasonable
construction was possible for the language used in section 1714.10 which
required a showing of "reasonable probability of success" before the pleading
of a claim of civil conspiracy between an attorney and client would be
allowed. The court, noting that it was bound to adopt the construction which
would save the statute from constitutional infirmity, stated: "... [T]he
legislative purpose of section 1714.10 was to eliminate frivolous
allegations that attorneys have *1721 conspired with their clients. This
statutory purpose is served by a construction that requires a prefiling
procedure to determine whether the proposed conspiracy pleading is legally
sufficient, and whether it is supported by a sufficient prima facie showing of
facts to sustain a favorable decision if the evidence submitted by the
petitioner is credited. If either of these requirements is not met, the
petition must be denied; if both are satisfied, it must be granted. This is a
determination of law, not of fact. [Citation.] So construed, the statute
provides a vehicle to preclude frivolous allegations of conspiracy without
subjecting the allegations to a fact adjudicative screen that would violate the
jury clause." (Id. at p. 931, 11 Cal.Rptr.2d 113.) Thus, the demonstration
of a "reasonable probability" of success requires only the exhibition of a
prima facie case.
While the "substantial probability" language of section 425.13 differs from
Civil Code section 1714.10's use of the term "reasonable probability," it
does not appear to so alter the pleader's burden as to compel a different
analysis than that applied by the Hung court. Certainly, the language
utilized in section 425.13 is ambiguous in **631 the same way the phrase
"reasonable probability" was found to be ambiguous in Hung. [FN11] This
conclusion necessarily influences our examination of section 425.14.
FN11. As the court in Hung stated, "The phrase, 'a reasonable
probability' may be taken to mean that the petitioner must show that he or
she has a case that will survive a motion for nonsuit and that, if
successful, will be supported by sufficient evidence to warrant affirmance
on appeal. This construction gives to the noun 'probability' its literal
meaning as descriptive of the relative likelihood of an outcome.
[Citation.] The adjective 'reasonable' requires the petitioner to do more
than demonstrate some chance of winning; the petitioner must show that,
given the evidence, he or she has a substantial case. [P] If the
Legislature had intended to require a petitioner to not only show a
cognizable case but also that it is a winning case, it would have been a
simple matter to use language that would have conveyed that meaning
unambiguously, or at least with greater clarity. [Citations.]" (8
Cal.App.4th at p. 929, 11 Cal.Rptr.2d 113; emphasis in the original.)
The legislative history of section 425.14 demonstrates an intent on
the part of the Legislature to impose a burden similar to that imposed by
section 425.13. As originally proposed, this legislation was an amendment to
Civil Code section 3294 which barred the recovery of any punitive damages
against a charitable organization, including a religious corporation. (Sen.
Bill No. 1 (1987-1988 Reg.Sess.).) It was amended in the Senate, on January
26, 1988, so as to incorporate charitable organizations into the recently
enacted healthcare provider legislation (s 425.13). The Senate passed this
version. It was in the Assembly, on August 26, 1988, where the present wording
was adopted, where the attempt to integrate with the healthcare provider
statute was dropped and a new section (s 425.14) was drafted. This new
language also narrowed the coverage of the statute from charitable
organizations generally and limited it to religious corporations. *1722 The
legislation, as so modified, was approved by the Senate and was signed by the
Governor on September 26, 1988.
Rowe argues that the language, as finally approved, is free from ambiguity and
can only be read to require that the trial judge make a factual finding that
sufficient evidence has been presented to satisfy the clear and convincing
burden of proof required of plaintiffs seeking punitive damages. In other
words, Rowe contends, the statute requires that the trial judge must first
determine, from a review and weighing of supporting and opposing affidavits,
that the plaintiff will win on the issue of punitive damages before a claim for
such damages may be pled. Such construction would most certainly invade Rowe's
constitutional jury right. (Hung v. Wang, supra, 8 Cal.App.4th at p. 927,
11 Cal.Rptr.2d 113.) Nonetheless, given the language used by the Legislature,
this is certainly one reasonable way to construe the statute.
However, as was the case with the statutory language examined in Hung, it
is not the only reasonable construction. The burden imposed is to produce
sufficient evidence to "substantiate " that the plaintiff "will meet " the high
standard of proof required for punitive damages. This language can also be
read to require only that the plaintiff demonstrate to the court's satisfaction
that sufficient evidence exists to go to the jury on the issue of punitive
damages. That is, plaintiff has sufficient evidence, if credited, to meet the
clear and convincing standard and the judge is unable to say that a reasonable
jury could not find for the plaintiff under that standard of proof. We
therefore must conclude that this statute is ambiguous.
b. Construction of Section 425.14
"Judicial doctrine governing construction of a law to avoid
unconstitutionality is well settled. If 'the terms of a statute are by fair
and reasonable interpretation capable of a meaning consistent with the
requirements of the Constitution, the statute will be given that meaning,
rather than another in conflict with the Constitution.' [Citations.]
Consequently, '[i]f feasible within bounds set by their words and purposes,
statutes should be construed to preserve their constitutionality.'
[Citation.] " (Metromedia, Inc. v. City of San Diego (1982) 32 Cal.3d 180,
186, 185 Cal.Rptr. 260, 649 P.2d 902.) "This follows from the presumption that
the legislative body intended **632 to enact a valid statute, ...
[Citations.] The United States Supreme Court has explained that the rule in
favor of a construction which upholds a statute's validity 'plainly must mean
that where a statute is susceptible of two constructions, by one of which grave
and doubtful constitutional questions arise and by the other of which such
questions are avoided, our duty is to adopt the latter.' [Citations.]"
(People v. Davenport (1985) 41 Cal.3d 247, *1723 264, 221 Cal.Rptr. 794,
710 P.2d 861; see Izazaga v. Superior Court (1991) 54 Cal.3d 356, 371-372,
285 Cal.Rptr. 231, 815 P.2d 304.)
[5][6] Applying these general rules, we are required to resolve any
ambiguity in section 425.14 in a manner which is consistent, not
inconsistent, with Rowe's constitutional right to a jury trial. (Hung v.
Wang, supra, 8 Cal.App.4th at p. 931, 11 Cal.Rptr.2d 113.) We therefore must
read the statute to require only that a plaintiff demonstrate the existence of
sufficient evidence to establish a prima facie case for punitive damages,
having in mind the higher clear and convincing standard of proof. In the words
of the Hung court, it is only necessary that plaintiff provide "a sufficient
prima facie showing of facts to sustain a favorable decision if the evidence
submitted is credited." (8 Cal.App.4th at p. 931, 11 Cal.Rptr.2d 113.) The
trial court is not required to make any factual determination or to become
involved in any weighing process beyond that necessarily involved in deciding
whether a prima facie case for punitive damages exists. Once the court
concludes that such a case can be presented at trial it must permit the
proposed amended pleading to be filed. If it concludes that no such case
exists, then it properly rejects the proposed pleading amendment. In making
this judgment, the trial court's consideration of the defendant's opposing
affidavits does not permit a weighing of them against the plaintiff's
supporting evidence, but only a determination that they do not, as a matter of
law, defeat that evidence.
This construction not only avoids obvious unconstitutionality, but is
consistent with the intent of the Legislature. The legislative history [FN12]
clearly demonstrates that the statute's purpose is to protect religious
organizations from the expense of defending against punitive damage claims for
which a plaintiff can show no likelihood of success. [FN13]
FN12. In compliance with Evidence Code sections 455 and 459 we
advised counsel prior to oral argument that we intended to take judicial
notice of the legislative history of section 425.14. Counsel were given
an opportunity to provide relevant information regarding such history both
at oral argument and by post-argument letter briefs which have been
received and considered.
FN13. In the records of both the Senate, where the bill originated, and in
the Assembly, where the final amendments were made, the same statement of
purpose is repeatedly reflected, "[T]he primary purpose of this bill is to
protect religious organizations from what some individuals consider to be
unjustifiably large punitive damage awards. This bill eliminates the
immediate threat of a large punitive damage award by erecting a 'pleading
hurdle,' namely, the requirement that some likelihood of success be
demonstrated to the court as a condition of pleading punitive damages. Of
course, this bill does nothing to limit the actual award of punitive
damages once a court has granted leave to amend the complaint. [P] In this
regard, the change enacted last year in SB 241 (Lockyer), in which the
standard of proof for punitive damages was raised from preponderance of the
evidence to clear and convincing evidence, will do more to control
'excessive' punitive damage awards." (Third Reading Analysis of Sen. Bill
1. Cf. Analysis of Senate Bill 1 prepared for the Assembly Committee on
Judiciary, Subcommittee on the Administration of Justice; emphasis added.)
The imposition of such a pre-pleading burden does not impair Rowe's right to a
jury trial. The decision which the trial judge is required to *1724 make
under this statute is substantially the same as in the case of a summary
judgment motion. The only distinction is that under section 425.14 the
burden is on the plaintiff to sustain the proposed pleading while in other
cases, where the plaintiff does not have such a statutory pleading hurdle, a
defendant's summary judgment motion imposes the burden on the defendant to
defeat plaintiff's claim. (s 437c, subd. (n)(2); Torres v. Reardon (1992)
3 Cal.App.4th 831, 836, 5 Cal.Rptr.2d 52.) However, merely reversing
**633 that burden does not involve deprivation of a jury right.
The burden imposed on a plaintiff by this legislation is very similar to that
imposed on a plaintiff who responds to a summary judgment under the Federal
Rules of Civil Procedure; and that burden has been upheld against claims that
it violated the federal right to a jury trial under the Seventh Amendment.
(Johnston v. IVAC Corp. (Fed.Cir.1989) 885 F.2d 1574, 1577; Etalook v.
Exxon Pipeline Co. (9th Cir.1987) 831 F.2d 1440, 1446-1447; see also Hung
v. Wang, supra, 8 Cal.App.4th at p. 932, 11 Cal.Rptr.2d 113.) This conclusion
is not altered by the fact that the pretrial threshold is the heightened "clear
and convincing" standard required for proof of entitlement to punitive damages.
When a motion for summary judgment is made in a case where the
plaintiff's claim carries a clear and convincing burden of proof, the evidence
and all inferences which can reasonably be drawn therefrom must meet that
higher standard. (Anderson v. Liberty Lobby, Inc. (1986) 477 U.S. 242, 254-
255, 106 S.Ct. 2505, 2513, 91 L.Ed.2d 202, 216; Reader's Digest Assn. v.
Superior Court (1984) 37 Cal.3d 244, 252, 208 Cal.Rptr. 137, 690 P.2d 610;
Miller v. Nestande (1987) 192 Cal.App.3d 191, 196, 237 Cal.Rptr. 359.) As
the United States Supreme Court put it, "... in ruling on a motion for summary
judgment, the judge must view the evidence presented through the prism of the
substantive evidentiary burden.... [P] Our holding that the clear-and-
convincing standard of proof should be taken into account in ruling on summary
judgment motions does not denigrate the role of the jury. It by no means
authorizes trial on affidavits. Credibility determinations, the weighing of
the evidence, and the drawing of legitimate inferences from the facts are jury
functions, not those of a judge, whether he is ruling on a motion for summary
judgment or for a directed verdict." (Anderson v. Liberty Lobby, Inc.,
supra, 477 U.S. at pp. 254-255, 106 S.Ct. at p. 2513, 91 L.Ed.2d at pp. 215-
216.) If the federal summary judgment procedure does not impinge on the right
to a jury trial, then section 425.14, which imposes no greater burden on a
state plaintiff, likewise does not.
*1725 c. Conclusion
We thus conclude that there is no invasion of Rowe's right to a jury trial;
and we therefore reject the contention that section 425.14 is
unconstitutional as an infringement of that right. That does not, however,
conclude our examination of this objection to the trial court's ruling. We
also have to determine, on the record before us, whether the trial court
properly found that Rowe had failed to demonstrate the existence of a prima
facie case.
However, before we can reach that issue, we must address Rowe's second
constitutional argument: that section 425.14 violates the Establishment
Clause of the First Amendment of the United States Constitution. Rowe contends
that the statute provides a unique benefit to religious organizations and
imposes a unique burden upon their adverse parties, in the absence of a
legitimate secular purpose for doing either.
2. Section 425.14 Does Not Violate the Establishment Clause of the First
Amendment.
The religion clauses of the First Amendment forbid the making of laws
"respecting an establishment of religion, or prohibiting the free exercise
thereof." Commonly referred to as the Establishment and Free Exercise Clauses,
they together permit and require that government maintain a "benevolent
neutrality which will permit religious exercise to exist without sponsorship
and without interference." (Walz v. Tax Commission (1970) 397 U.S. 664,
669, 90 S.Ct. 1409, 1412, 25 L.Ed.2d 697.)
[7] The "benevolent neutrality" required by the First Amendment involves a
delicate balance between the avoidance of sponsorship on the one hand and
interference on the other. The United States Supreme Court has noted that the
two religion clauses exist in "tension" with one another (Thomas v. Review
Bd. Ind. Empl. Sec. Div. (1981) 450 U.S. 707, 719, 101 S.Ct. 1425, 1432, 67
L.Ed.2d 624; see also Wisconsin **634 v. Yoder (1972) 406 U.S. 205, 220-
221, 92 S.Ct. 1526, 1536, 32 L.Ed.2d 15) and has "struggled to find a neutral
course between [them], both of which are cast in absolute terms, and either of
which, if expanded to a logical extreme, would tend to clash with the other."
(Walz v. Tax Commission, supra, 397 U.S. at pp. 668-669, 90 S.Ct. at pp.
1411.)
The religion clauses are, of course, in harmony to the extent that a law
which "establishes" one religious view inevitably tends to "prohibit the free
exercise" of others. (See Sands v. Morongo Unified School District (1991)
53 *1726 Cal.3d 863, 870, 281 Cal.Rptr. 34, 809 P.2d 809.) However, the two
clauses come into conflict when secular laws, although neutral as to religion
in their intent, nonetheless in some manner impair the free exercise of
religion. If the impairment is severe, the Free Exercise clause may be
violated. (Hobbie v. Unemployment Appeals Commission (1987) 480 U.S. 136,
146, 107 S.Ct. 1046, 1052, 94 L.Ed.2d 190; Wisconsin v. Yoder, supra, 406
U.S. at p. 220, 92 S.Ct. at p. 1535.) Yet, exemptions from the ordinary
requirements of the law may, if they are overly generous to religion, be
subject to attack as "establishing" the religions exempted. (Texas Monthly,
Inc. v. Bullock (1989) 489 U.S. 1, 15, 109 S.Ct. 890, 899, 103 L.Ed.2d 1;
Estate of Thornton v. Caldor, Inc. (1985) 472 U.S. 703, 710, 105 S.Ct. 2914,
2918, 86 L.Ed.2d 557.)
[8][9][10] The Establishment Clause, which is made applicable to the states
through the Fourteenth Amendment (Everson v. Board of Education (1947) 330
U.S. 1, 15, 67 S.Ct. 504, 511, 91 L.Ed. 711), was intended to protect against
three main evils: (1) sponsorship (2) financial support of religion by the
civil government and (3) active involvement of the sovereign in religious
activity. (Lemon v. Kurtzman (1971) 403 U.S. 602, 612, 91 S.Ct. 2105, 2111,
29 L.Ed.2d 745; Walz v. Tax Commission, supra, 397 U.S. at p. 668, 90 S.Ct.
at p. 1411.) However, the Establishment Clause has not been broadly applied to
prohibit the grant to a religious organization of every possible benefit. For
example, such a grant is permissible, if it meets the three-prong test set out
in Lemon v. Kurtzman, supra, 403 U.S. 602, 91 S.Ct. 2105. Under Lemon, a
valid benefit grant must (1) have a valid secular purpose, (2) not have a
primary effect of advancing religion or any particular religious sect, and (3)
not foster excessive government entanglement in religion. (403 U.S. at pp.
612-613, 91 S.Ct. at pp. 2111.)
[11] Within such limitations, it has long been recognized that the
government may, and sometimes must, make specific "accommodations" of religious
needs of the people, and that it may do so without violating the Establishment
Clause. (Corporation of Presiding Bishop v. Amos (1987) 483 U.S. 327, 334-
335, 107 S.Ct. 2862, 2868, 97 L.Ed.2d 273; Zorach v. Clauson (1952) 343
U.S. 306, 314, 72 S.Ct. 679, 684, 96 L.Ed. 954; see generally, McConnell,
Accommodation of Religion, (1986) 1985 S.Ct.Rev. 1-59.) The validity of any
particular benefit to religion depends upon whether the benefit constitutes
such an "accommodation" of religion or instead is an impermissible
"advancement." Rowe, of course, argues that section 425.14 impermissibly
advances religion. In particular, Rowe contends the statute suffers from the
same constitutional defect as a statute found invalid by the United States
Supreme Court in Texas Monthly, Inc. v. Bullock, supra, 489 U.S. 1, 109
S.Ct. 890.
*1727 In Texas Monthly, the Court struck down a Texas statute
which granted an exemption from its sales tax for religious publications
distributed by religious faiths and consisting of religious teachings or sacred
religious texts. Justice Brennan, writing for the three-member plurality,
stated the basis for overturning the statute as follows: "[W]hen government
directs a subsidy exclusively to religious organizations that is not required
by the Free Exercise Clause and that either burdens nonbeneficiaries markedly
or cannot reasonably be seen as removing a significant state-imposed deterrent
to the free exercise of religion, as Texas has done ..., it 'provides
unjustifiable rewards of assistance to religious organizations' and cannot
but **635 'conve[y] a message of endorsement' to slighted members of the
community. [Citation.] This is particularly true where, as here, the subsidy
is targeted at writings that promulgate the teachings of religious faiths."
(Texas Monthly, Inc. v. Bullock, supra, 489 U.S. at p. 15, 109 S.Ct. at p.
900; emphasis in the original.)
Rowe argues that section 425.14 violates the Establishment Clause by
providing a unique benefit to religious organizations, as did the statute
overturned in Texas Monthly, and by imposing a unique burden upon others,
again as did the statute in Texas Monthly. Rowe contends such circumstances
prove the statute is intended to, and does, sponsor and financially support
religion, thereby advancing it.
[12][13] For the reasons which we discuss below, we disagree and conclude
section 425.14 is a reasonable accommodation of religion, which passes all
three of the Lemon criteria and which accordingly serves the interests
embodied in the Free Exercise Clause, without sacrificing those represented by
the Establishment Clause. However, in reaching this conclusion we must
emphasize that while there can be little doubt that the Lemon criteria are
the proper standard to be applied (Sands v. Morongo Unified School Dist.,
supra, 53 Cal.3d at pp. 871-872, 281 Cal.Rptr. 34, 809 P.2d 809), it is also
clear that where the subject is legislation such as section 425.14, which
seeks to advance free exercise values, a rigid application of Lemon is not
appropriate. (Duffy v. State Personnel Bd. (1991) 232 Cal.App.3d 1, 11, 283
Cal.Rptr. 622.)
As the court in Duffy put it, "Legislation exempting religious observers
from generally applicable government obligations would seldom, if ever, pass
the 'purpose' and 'effects' prongs of the Lemon test since by definition,
such legislation has a religious purpose and effect in promoting the free
exercise of religion. [Citation.] On the other hand, judicial deference to
all legislation that purports to facilitate the free exercise of religion would
completely vitiate the establishment clause since any statute pertaining to
religion can be viewed as accommodating free exercise rights...." (Ibid.)
*1728 The question which we address is whether section 425.14 falls
within the limits imposed by the establishment clause on voluntary government
efforts to facilitate the free exercise of religion when such exercise is
burdened by government itself. With that as a preface, we turn to an
application of the three Lemon criteria. [FN14]
FN14. As will be apparent from the following discussion, there is
considerable overlap and interdependence between the "secular purpose" and
"primary effect" criteria set out in Lemon. Indeed, Justice O'Connor,
concurring in Wallace v. Jaffree (1985) 472 U.S. 38, 105 S.Ct. 2479, 86
L.Ed.2d 29, appears to call for the merger of these two tests. At least
that is the view of one California court. (Duffy v. State Personnel
Bd., supra, 232 Cal.App.3d at pp. 11-12, 283 Cal.Rptr. 622.) In Duffy,
the court noted that even if recognition is given to the fact that a
particular governmental act advances religion, it is nonetheless necessary
"to separate those benefits to religion that constitutionally accommodate
the free exercise of religion from those that provide unjustifiable awards
of assistance to religious organizations. In so doing the inquiry is
'whether government's purpose is to endorse religion and whether the
statute actually conveys a message of endorsement.' [Citation.] Under
this approach, the 'purpose' inquiry does not stand as an independent test,
capable of striking down government acts on its own. Rather, it is an
additional, subordinate index of unconstitutionality. To ascertain whether
the statute conveys a message of endorsement, the relevant issue is how it
would be perceived by an objective observer, acquainted with the text,
history, and implementation of the government act. [Citation.] [P] The
merger of the 'purpose' and 'effects' tests in this way reduces the
likelihood of an erroneous conclusion about legislative motive, and
eliminates the danger that a rigidly applied 'purpose' test alone might
invalidate laws whose effects are purely secular or advance free exercise
values. It also helps explain cases where the Supreme Court has upheld
long-established state practices that began in religion, such as Sunday
closing laws, [citation], and practices that acknowledge religion such as
legislative prayers [citation], and state-owned creches [citations.]."
a. Secular Legislative Purpose
As already noted, Rowe argues section 425.14 has no legitimate
secular purpose and thus is not simply a permissible "accommodation" of
religion, but rather is a constitutionally prohibited "advancement."
**636 The primary basis for Rowe's argument is that only religious
organizations are benefited. Rowe relies primarily upon Texas Monthly, Inc.
v. Bullock, supra, 489 U.S. 1, 109 S.Ct. 890, as authority.
In Texas Monthly, the circumstance that the subsidy was directed
exclusively to religious organizations and that it was not required by the Free
Exercise Clause formed a substantial part of the plurality's rationale for
finding Texas's sales tax exemption for religious publications
unconstitutional. (Texas Monthly, Inc. v. Bullock, supra, 489 U.S. at p.
15, 109 S.Ct. at p. 899.) Rowe contends section 425.14 parallels the Texas
exemption in this respect.
*1729 Section 425.14 does not, of course, direct an actual or
constructive subsidy to religious organizations. [FN15] However, it does
afford a procedural advantage which may result in a saving of legal costs, and
which, in some ways is a benefit analogous to a subsidy. Further, section
425.14 admittedly is directed exclusively to religious organizations.
FN15. We also note that section 425.14 differs in one other very
significant respect from the statute invalidated in Texas Monthly. The
statute in that case did not merely exempt religious organizations from a
tax; it exempted religious publications from a tax, and did so only if
such publications consisted wholly of "writings promulgating the teaching
of the faith" or of "writings sacred to a religious faith." (489 U.S.
at p. 5, 109 S.Ct. at p. 894.) The circumstance that the Texas statute
gave preferential treatment to the publication of religious messages was
the only circumstance that a majority of the court found violative of the
First Amendment.
[14] However, those circumstances, without more, do not rebut the existence
of a secular purpose. Of course, a valid secular purpose is more easily
established where legislation grants a benefit to a broad class of institutions
and organizations, which is so defined that "it can be fairly concluded that
religious institutions could be thought to fall within [its] natural
perimeter." (Walz v. Tax Commission, supra, 397 U.S. at p. 696, 90 S.Ct. at
p. 1425 (conc. opn. of Harlan, J.); see also Texas Monthly, Inc. v.
Bullock, supra, 489 U.S. at p. 17, 109 S.Ct. at p. 900 (lead opn. of Brennan,
J.).) Nonetheless, such a broad class is not essential to establish a proper
purpose for a benefit to religious organizations, and it is not required that
benefits to religion "come packaged with benefits to secular entities."
(Corporation of Presiding Bishop v. Amos, supra, 483 U.S. at p. 338, 107
S.Ct. at p. 2869; see also Walz v. Tax Commission, supra, 397 U.S. at p.
674, 90 S.Ct. at p. 1414.) [FN16] Thus, a violation of the Establishment
Clause is not established by the mere circumstance that section 425.14
protects only religious organizations. (Corporation of Presiding Bishop v.
Amos, supra, 483 U.S. at pp. 335-336, 107 S.Ct. at p. 2868.)
FN16. Even the plurality in Texas Monthly, supra, which found the
challenged statute unconstitutional in large part because "it lack[ed]
sufficient breadth," stopped short of finding invalid all benefits that
are (1) conferred exclusively upon religious groups, or upon individuals
because of their religious beliefs, and (2) not required by the Free
Exercise Clause. The Texas Monthly plurality noted that previous
decisions of the Court had upheld such exclusive benefits to religion as
long as they either (1) did not impose substantial burdens on
nonbeneficiaries, or (2) were designed to alleviate significant
governmental intrusions upon the free exercise of religion. (Texas
Monthly, Inc. v. Bullock, supra, 489 U.S. at p. 18, fn. 8, 109 S.Ct. at p.
901, fn. 8.)
[15] Nor does the requirement of a secular purpose amount to a requirement
that the law's purpose be unrelated to religion. (Corporation of Presiding
Bishop v. Amos, supra, 483 U.S. at p. 335, 107 S.Ct. at p. 2868.) To the
contrary, although "advancement" of religion by the government is prohibited
(Lemon v. Kurtzman, supra, 403 U.S. at p. 612, 91 S.Ct. at p. 2111),
*1730 the Constitution does not require the government to show "a callous
indifference to religious groups." (Zorach v. Clauson, supra, 343 U.S. at
p. 314, 72 S.Ct. at p. 684. See also Corporation of Presiding Bishop v.
Amos, supra, 483 U.S. at p. 335, 107 S.Ct. at p. 2868).)
[16] To facilitate the "benevolent neutrality" toward religion the
government may make "accommodations" to religion without violating the
Establishment Clause. The Supreme Court has found that a number of such
"accommodations" **637 are not prohibited. (See, e.g., Corporation of
Presiding Bishop v. Amos, supra, 483 U.S. at pp. 334-335, 107 S.Ct. at p. 2868
[federal statute exempting employers who are religious organizations from equal
employment requirements of the Civil Rights Act of 1964]; Zorach v.
Clauson, supra, 343 U.S. at p. 315, 72 S.Ct. at p. 684 [city ordinance
providing "released time" for public school students to attend religious
instruction]; Selective Draft Law Cases (1918) 245 U.S. 366, 389-390, 38
S.Ct. 159, 165, 62 L.Ed. 349 [exemption from combat service of persons whose
religious tenets forbid it].) Beyond finding that various benefits to religion
are not prohibited by the Establishment Clause, the Supreme Court has
affirmatively held that "[u]nder the Lemon analysis, it is a permissible
legislative purpose to alleviate significant governmental interference with the
ability of religious organizations to define and carry out their religious
missions." (Corporation of Presiding Bishop v. Amos, supra, 483 U.S. at p.
335, 107 S.Ct. at p. 2868; emphasis added.) [FN17]
FN17. In so holding, the Supreme Court acknowledged that an express
purpose of benefiting religious organizations is not, strictly speaking,
"secular," even where the benefit can legitimately be characterized as an
"accommodation." (Corporation of Presiding Bishop v. Amos, supra, 483
U.S. at p. 335, 107 S.Ct. at p. 2868.) Lemon 's requirement of a
secular purpose "does not mean that the law's purpose must be unrelated to
religion." (Ibid.) In effect, the Court appears to have adopted the
views expressed by Justice O'Connor in her concurrence in Wallace v.
Jaffree, supra, 472 U.S. 38, 83, 105 S.Ct. 2479, 2503, 86 L.Ed.2d 29. In
her opinion, Justice O'Connor suggested that the "purpose" test under the
Establishment Clause should be modified from the strict "secular" purpose
test enunciated in Lemon to one which leaves room under the
Establishment Clause for legislation which does not have a secular purpose
in the ordinary sense of that term, but which serves the values embodied in
the Free Exercise Clause. Specifically, Justice O'Connor said: "The
solution to the conflict between the Religion Clauses lies ... in
identifying workable limits to the government's license to promote the free
exercise of religion.... On its face, the [Free Exercise] Clause is
directed at government interference with free exercise. Given that
concern, one can plausibly assert that government pursues Free Exercise
Clause values when it lifts a government-imposed burden on the free
exercise of religion. If a statute falls within this category, then the
standard Establishment Clause test should be modified accordingly. It is
disingenuous to look for a purely secular purpose when the manifest
objective of a statute is to facilitate the free exercise of religion by
lifting a government-imposed burden. Instead, the Court should simply
acknowledge that the religious purpose of such a statute is legitimated by
the Free Exercise Clause." (472 U.S. at p. 83, 105 S.Ct. at p. 2504,
conc. opn. of O'Connor; emphasis added.)
In Presiding Bishop, the Supreme Court upheld section 702 of the
Civil Rights Act of 1964, as amended (42 U.S.C. s 2000e-1). This section
created *1731 a statutory exemption of religious organizations from
provisions of Title VII of that Act which otherwise prohibit discrimination in
employment on the basis of religion. (Id. at pp. 339-340, 107 S.Ct. at p.
2870.) As originally enacted, section 702 of the Civil Rights Act exempted
only the religious activities of such organizations from the general
prohibition. However, in 1972, the statute was amended to exempt all
activities of such organizations. (Presiding Bishop, supra, 483 U.S. at p.
332, fn. 9, 107 S.Ct. at p. 2866, fn. 9.) The District Court concluded the
amendment's purpose was the legitimate secular purpose of minimizing
governmental "interfer[ence] with the decision-making process in religions."
(Id. at p. 332, 107 S.Ct. at p. 2866, quoting from the opinion of the
District Court.) [FN18]
FN18. However, we note that the District Court found the statute invalid
under the Establishment Clause, as having the primary effect of advancing
religion. (Id. at p. 333, 107 S.Ct. at p. 2866.)
The Supreme Court agreed with the District Court's conclusion: "We may assume
for the sake of argument that the pre-1972 exemption was adequate in the sense
that the Free Exercise Clause required no more. Nonetheless, it is a
significant burden on a religious organization to require it, on pain of
substantial liability, to predict which of its activities a secular court will
consider religious. The line is hardly a bright one, and an organization might
understandably be concerned that a judge would not understand its religious
tenets and sense of mission. Fear of potential liability might affect the way
an organization carried out **638 what it understood to be its religious
mission." (Presiding Bishop, supra, at p. 336, 107 S.Ct. at p. 2868.)
The governmental interference with religion which was intended to be
alleviated by section 702 of the Civil Rights Act--a clear governmental
restriction on religious organizations' discretion in hiring--was particularly
obvious and direct. By comparison, the interference to be alleviated by
section 425.14 is perhaps less obvious, but it is no less real and no less
burdensome on religion. Civil Code section 3294, by recognizing a cause of
action for exemplary and punitive damages, effectively puts the power and
authority of the state and its courts at the disposal of private parties to
prosecute claims which may or may not be meritorious, and if such claims are
proven meritorious, to enforce them. The requirement that the parties sued
must either appear and defend against punitive damage claims or risk a
potentially immense forfeiture thus constitutes a palpable and material state-
imposed burden. [FN19]
FN19. This conclusion finds an analogy in the reasoning of the United
States Supreme Court in Shelley v. Kraemer (1948) 334 U.S. 1, 68 S.Ct.
836, 92 L.Ed. 1161 and in the recently decided Edmonson v. Leesville
Concrete Co., Inc. (1991) 500 U.S. 614, 111 S.Ct. 2077, 114 L.Ed.2d 660.
In Shelley, it will be remembered, the Supreme Court held there is
"state action" within the meaning of the Fourteenth Amendment where the
state courts are utilized by private litigants to enforce racially
restrictive covenants regarding the use and occupancy of real property.
(334 U.S. at p. 20, 68 S.Ct. at p. 845.) In Edmonson, the Court held
there is "state action" when a private litigant exercises peremptory
challenges to strike jurors in a civil case on grounds of racial or group
bias. (--- U.S. at pp. ---- - ----, 111 S.Ct. at pp. 2082-2087.)
[17] Under well-established principles of Establishment Clause analysis, the
government can legitimately relieve religious institutions of this
*1732 burden, because it can rationally be seen as posing a significant
deterrent to the free exercise of religion. [FN20] Just as the fear of
litigation under Title VII might improperly affect a religious organization's
hiring practices, the fear of being called before a court to defend against
unfounded claims for punitive damages might likewise improperly affect the way
in which a religious organization carries out what it views as its religious
mission. The free exercise of religion is thus served, and the prohibition
against establishing religion is not violated, by legislation designed to
mitigate the potentially chilling effects upon the practices of religious
groups resulting from the threat of litigation over unfounded punitive damages
claims. The statute endeavors to insulate religious organizations from the
threat of being required to defend against insupportable punitive damages
claims--a potentially significant state-imposed burden upon religious
practices. This is a reasonable goal, and seeking to achieve it is a
legitimate secular purpose. (Corporation of Presiding Bishop v. Amos,
supra, 483 U.S. at p. 335, 107 S.Ct. at p. 2868.)
FN20. Although laws discriminating among religions are subject to strict
scrutiny, laws which afford a uniform benefit to all religions are upheld
if rationally related to the furtherance of a legitimate end
(Corporation of the Presiding Bishop, supra, 483 U.S. at p. 339, 107
S.Ct. at p. 2870) and are found invalid only if "wholly motivated by an
impermissible purpose." (Bowen v. Kendrick (1988) 487 U.S. 589, 602,
108 S.Ct. 2562, 2570, 101 L.Ed.2d 520; Wallace v. Jaffree, supra, 472
U.S. at p. 56, 105 S.Ct. at p. 2489.)
b. "Primary Effect"
Under the second Lemon test, the law in question must have a
"principal or primary effect ... that neither advances nor inhibits
religion." (403 U.S. at p. 612, 91 S.Ct. at p. 2111.) Here, the inquiry is
whether, irrespective of the government's intent, the practice in question
"advances" religion.
What constitutes an improper "advancement" of religion has been variously
characterized. [FN21] Generally, the court has invalidated **639 legislation
which either (1) burdens others while benefiting religion (Estate of
Thornton v. *1733 Caldor, Inc., supra, 472 U.S. at pp. 708-709, 105 S.Ct. at
p. 2917; (2) compels participation in religious observances (Lee v.
Weisman (1992) 505 U.S. 577, ----, 112 S.Ct. 2649, 2661, 120 L.Ed.2d 467, 488;
or (3) endorses particular religious ideas or endorses religious ideas
generally (Epperson v. Arkansas (1968) 393 U.S. 97, 106-107, 89 S.Ct. 266,
272, 21 L.Ed.2d 228). By contrast, the Supreme Court has found legislation to
effect a reasonable "accommodation" to religion where the legislation imposed
no substantial burdens upon nonbeneficiaries, while at the same time either
allowing the adherents of particular religions to act according to their
beliefs, or alleviating governmental intrusions that might significantly deter
or chill conduct that is protected by the Free Exercise Clause. (Texas
Monthly, Inc. v. Bullock, supra, 489 U.S. at p. 18, fn. 8, 109 S.Ct. at p. 901,
fn. 8.)
FN21. In Corporation of the Presiding Bishop, supra, 483 U.S. 327, 107
S.Ct. 2862, the majority stated that "[a] law is not unconstitutional
simply because it allows churches to advance religion, which is their very
purpose. For a law to have forbidden 'effects' under Lemon it must be
fair to say that the government itself has advanced religion through its
own activities and influence." (Corporation of Presiding Bishop v.
Amos, supra, 483 U.S. at p. 337, 107 S.Ct. at p. 2869; emphasis in the
original.) Concurring separately, Justice O'Connor criticized the
majority's analysis as "obscur[ing] far more than enlighten[ing]" and
instead, characterized an impermissible governmental "advancement" of
religion as a benefit to a religious institution which provides
"unjustifiable awards of assistance to religious organizations" or "conveys
a message of endorsement" either of a particular religion or of religion
generally. (Id. at pp. 347-348, 107 S.Ct. at p. 2874, conc. opn. of
O'Connor, J.)
Without question, the threat of incurring legal expenses in the defense of
unfounded claims for punitive damages constitutes a significant potential
deterrent to the free exercise of religion. Section 425.14 was enacted with
the express intent of removing, or at least mitigating, that threat, and it
plainly does so. A plaintiff wishing to claim punitive damages against a
religious organization must make a prima facie showing of merit before the
claim can be pleaded or the organization required to answer.
However, the requirement of such a showing does not burden non-beneficiaries
markedly or compel participation in religious observances or endorse religious
ideas or tenets. Unlike a tax exemption for religious organizations, which has
the effect of making the tax burden greater for those not exempt (Texas
Monthly, Inc. v. Bullock, supra, 489 U.S. at p. 14, 109 S.Ct. at p. 899;
Bob Jones University v. United States (1983) 461 U.S. 574, 591, 103 S.Ct.
2017, 2028, 76 L.Ed.2d 157), or a requirement that employers accommodate the
schedules of religiously observant employees (Estate of Thornton v. Caldor,
Inc., supra, 472 U.S. at pp. 708-709, 105 S.Ct. at p. 2917), section
425.14 imposes no burden upon defendants that are not religious organizations.
Such defendants must respond to frivolous, as well as potentially meritorious,
punitive damage claims, whether the same requirement applies to religious
organizations or not.
Nor does the statute unreasonably burden plaintiffs who do have legitimate
punitive damage claims against religious organizations. These plaintiffs need
only make a showing of prima facie merit earlier in the course of litigation
than plaintiffs with similar claims must do against other defendants. Thus,
section 425.14 leaves ultimately undisturbed both the rights of
*1734 injured parties to enforce legitimate claims against religious
organizations and the right of civil society to protect its citizens from
oppression, fraud and malice, whether by religious sects or others.
c. Excessive Government Entanglement With Religion
With respect to the third and final Lemon criterion, it is obvious
that section 425.14 does not foster excessive entanglement between religion
and the state. (Lemon v. Kurtzman, supra, 403 U.S. at p. 613, 91 S.Ct. at
p. 2111). If anything, section 425.14 minimizes involvement between the
government and religious institutions by allowing religious institutions to
refrain from responding in any manner to a claim for punitive damages until
after the claimant has made the required statutory showing of merit.
d. Conclusion
[18] Section 425.14 was intended to, and does, relieve religious
organizations of the need to respond to claims for punitive damages
**640 unless and until a prima facie showing of merit has been made. It has
both the intent and the primary effect of freeing mosques, synagogues,
churches, and religious organizations of all kinds from "a significant
governmental interference with [their] ability to define and carry out their
religious missions." (Corporation of the Presiding Bishop v. Amos, supra,
483 U.S. at p. 335, 107 S.Ct. at p. 2868.) It thus constitutes a permissible
"accommodation" of religion that is not inconsistent with the Establishment
Clause and in fact nourishes the "benevolent neutrality" by government toward
religion which is the ultimate aim of the First Amendment's two Religion
Clauses considered together. [FN22]
FN22. We do not reach or consider the issue of whether section 425.14
might violate the guarantees of separation of church and state contained in
the California Constitution. (Cal. Const., art. I, s 4.) While
arguably Rowe raised the issue in the trial court (see fn. 5, ante ), it
was not briefed or argued on appeal and therefore has been waived.
(Mann v. Cracchiolo (1985) 38 Cal.3d 18, 41, 210 Cal.Rptr. 762, 694 P.2d
1134; Adoption of Matthew B. (1991) 232 Cal.App.3d 1239, 1267, fn.
16, 284 Cal.Rptr. 18.) Parenthetically, however, we note that as
California's Establishment Clause is "virtually identical" to the one
contained in the First Amendment (Sands v. Morongo, supra, 53 Cal.3d at
p. 882, 281 Cal.Rptr. 34, 809 P.2d 809), our analysis and conclusion would
doubtless not be different were the issue before us. (See Duffy v.
State Personnel Bd., supra, 232 Cal.App.3d at p. 9, 283 Cal.Rptr. 622.)
3. The Court Subjected Rowe's Evidentiary Showing to an Improper Standard.
As discussed in some detail above, we have construed section 425.14 to
require Rowe to demonstrate the existence of sufficient evidence to establish a
prima facie right to recover punitive damages. That is, it is enough to show
sufficient evidence to permit that claim to go to a jury under *1735 the
clear and convincing standard. Our review of the record strongly suggests that
Rowe's showing was subjected to a much more stringent hurdle.
Both counsel for Scientology and the trial court appeared to have read
section 425.14 as requiring Rowe to actually prove, by clear and convincing
evidence, a right to recover punitive damages. Counsel argued that Rowe's
evidence did "not satisfy [the] burden of establishing [the] claim for punitive
damages by clear and convincing proof." (See fn. 4, ante.)
The trial court, in the announcement of its decision, indicated that it
considered and apparently weighed all of the supporting and opposing evidence
and found Rowe's evidence unpersuasive. Specifically, the court stated:
"... I have to have before me in order to grant relief under section
425.14, I have to have, in my view, clear and convincing proof, unequivocal,
the kind of proof that will leave no substantial doubt. [P] The kind of proof
that is sufficiently strong to command the unhesitating assertion of every
reasonable mind that indeed there was this despicable conduct that would call
for the issue of punitive damages to be placed before the jury. [P] I have a
hard time in just reviewing the affidavits alone, concluding that the
information there rises to the level of convincing the court by clear and
convincing evidence that there was fraud, oppression, malice, of the quantity
that would warrant adding on the punitive damages claim. There is a doubt.
[P] Therefore, I'm going to deny the motion for leave to allow the prayer for
punitive damages based upon that view...."
[19][20] We can not review such comments without some concern as to
whether the court had not in fact imposed upon Rowe a far heavier burden than
either was intended by the Legislature or is permitted by the language of the
statute if it is to pass constitutional muster. Indeed, from the words used by
the court, it appears likely that a standard was imposed on Rowe which required
an evidentiary showing which demonstrated a winning case. To the extent that
we have any doubt in this regard, fairness and justice require us to return the
matter to the trial court for reconsideration under the proper standard.
It seems clear that, subject to the usual limitations on the amendment of
pleadings prior to or during trial, a party seeking to comply with section
425.14 should be able **641 to do so at any time when there is available
sufficient evidence to make the required prima facie showing. Therefore, a
party should be free to renew a properly denied motion upon a subsequent and
timely discovery of additional evidence. That being the case, Rowe should be
permitted the opportunity to supply such additional evidence as may be
available to support the reconsidered application for leave to file an
*1736 amended pleading. Similarly, Scientology should be given an
opportunity to supplement its opposition.
DISPOSITION
The alternative writ is discharged. A peremptory writ shall issue directing
the trial court to vacate its order of September 22, 1992, denying Rowe's
motion to amend the complaint to allege claims for punitive damages and to
conduct further proceedings consistent with this opinion.
KLEIN, P.J., and HINZ, J., concur.