California Code of Civil Procedure Section 581
Code of Civil Procedure section 581, subdivision (c) states:
"A plaintiff may dismiss his or her complaint, or any cause of action asserted in it, in its entirety, or as to any defendant or defendants, with or without prejudice prior to the actual commencement of trial." Subdivision (d) states, "Except as otherwise provided in subdivision (e), the court shall dismiss the complaint, or any cause of action asserted in it, in its entirety or as to any defendant, with prejudice, when upon the trial and before the final submission of the case, the plaintiff abandons it." Subdivision (e) states, "After the actual commencement of trial, the court shall dismiss the complaint, or any causes of action asserted in it, in its entirety or as to any defendants, with prejudice, if plaintiff requests a dismissal, unless all affected parties to the trial consent to a dismissal without prejudice or by order of the court dismissing the same without prejudice on a showing of good cause."
In Gray v. Superior Court (1997) 52 Cal.App.4th 165, the parties stipulated to have a referee determine whether property should be partitioned by sale, as the plaintiff demanded, or by division, as the defendant preferred.
When the referee recommended that the property be partitioned by division, the plaintiff purported to dismiss the complaint with prejudice and the defendant petitioned to vacate the dismissal.
The plaintiff argued that trial had not commenced within the meaning of section 581 "because the referee's recommendation was only advisory and not dispositive." (Id. at p. 170.)
The appellate court had "no difficulty in concluding that trial in a partition action has commenced once evidentiary proceedings are begun before a referee.
Despite the fact that the partition referee's report was not in itself dispositive or tantamount to a final judgment, the trial proceedings began when the parties appeared before the referee to present their evidence." (Id. at p. 171.)
In reasoning directly applicable to the present situation, the court stated that the issue is "one of fairness: Once the parties commence putting forth the facts of their case before some sort of fact finder, such as an arbitrator, or at the pretrial stage a ruling is made on an issue of law or on admitted facts which effectively disposes of the plaintiff's case against him, it is unfair-and perhaps a mockery of the system-to allow the plaintiff to dismiss his complaint and refile. While our system is adversary and grounded on vigorous disputation, it is also dedicated to justice and grounded on the fundamental fairness of its proceedings. The thread of fairness is twisted out of true by the facts of this case. Here the parties spent two days litigating their case with seven witnesses. The referee made detailed recommendations of factual findings to the court. The referee was the factfinding arm of the court. Doubtless had real party prevailed before the referee, he would not have dismissed his complaint. To allow real party to dismiss in the wake of an unfavorable referee's recommendation would work an injustice." (Id. at p. 173.)