Freeny v. City of San Buenaventura

DISCUSSION

We independently review the trial court’s sustaining of a demurrer. (San Mateo Union High School Dist. v. County of San Mateo (2013) 213 Cal.App.4th 418 , 425 [ 152 Cal.Rptr.3d 530 ] (San Mateo).) In so doing, we accept the complaint’s allegations as true and construe them liberally to attain substantial justice among the parties. (Ibid.) We review the trial court’s decision not to grant leave to amend for an abuse of discretion. (Reynolds v. Bement (2005) 36 Cal.4th 1075 , 1091 [ 32 Cal.Rptr.3d 483 , 116 P.3d 1162 ] (Reynolds), abrogated on other grounds in Martinez v. Combs (2010) 49 Cal.4th 35 , 62-66 [ 109 Cal.Rptr.3d 514 , 231 P.3d 259 ].) On appeal, plaintiffs bear the burden of establishing error. (San Mateo, supra, at p. 426.)

When an administrative forum exists for presenting claims, a party is usually required to present claims in that forum before “resorting to the courts. . . .” (Coachella Valley Mosquito & Vector Control Dist. v. California Public Employees Relations Bd. (2005) 35 Cal.4th 1072 , 1080 [ 29 Cal.Rptr.3d 234 , 112 P.3d 623 ].) “Exhaustion requires ‘a full presentation to the administrative agency upon all issues of the case and at all prescribed stages of the administrative proceedings.’ ” (City of San Jose v. Operating Engineers Local Union No. 3 (2010) 49 Cal.4th 597 , 609 [ 110 Cal.Rptr.3d 718 , 232 P.3d 701 ], quoting Bleeck v. State Board of Optometry (1971) 18 Cal.App.3d 415 , 432 [ 95 Cal.Rptr. 860 ].)

This is not a case where the would-be litigant skipped the administrative procedures entirely. To the contrary, plaintiffs presented their application for building permits and variances to the Planning Commission and the City Council. Plaintiffs also obtained a definitive ruling rejecting their application as to the 42,172-square-foot project that underlies this lawsuit.

Defendants contend that this was still not enough. Defendants note that the City Council’s rejection was “without prejudice,” and argue that plaintiffs have yet to avail themselves of their right under the City’s municipal code (SBMC) to file a new application with the Planning Commission. (See SBMC § 24.565.060, subd. H.) Because the City Council advised plaintiffs that they

Whether reexhaustion with an entirely different project is required depends on the nature of the subsequent judicial challenge. If a plaintiff is claiming that a government entity has effected a regulatory taking by “ ‘den[ying] [her] all economically beneficial or productive use . . .’ ” of her property, denial of a single use or project may not be sufficient. (Landgate, Inc. v. California Coastal Com. (1998) 17 Cal.4th 1006 , 1017 [ 73 Cal.Rptr.2d 841 , 953 P.2d 1188 ], italics added, quoting Lucas v. South Carolina Coastal Council (1992) 505 U.S. 1003 , 1015 [ 120 L.Ed.2d 798 , 112 S.Ct. 2886 ].) Presentation and rejection of other uses—that is, reexhaustion—may also be necessary to establish that the property has no use. (See Dunn v. County of Santa Barbara (2006) 135 Cal.App.4th 1281 , 1299-1301 [ 38 Cal.Rptr.3d 316 ]; Del Monte Dunes v. City of Monterey (9th Cir. 1990) 920 F.2d 1496 , 1501.)

However, when all a plaintiff challenges is the denial of a specific use through denial of a special project, the plaintiff need only show that the administrative agency has finally ruled on that project. Requiring reexhaustion in these circumstances would pervert the exhaustion requirement. No longer would exhaustion be a means of allowing administrative agencies the opportunity to apply their expertise and flesh out facts. (Williams v. Housing Authority of Los Angeles (2004) 121 Cal.App.4th 708 , 722 [ 17 Cal.Rptr.3d 374 ].) Instead, exhaustion would become a tool for forestalling judicial review indefinitely by leaving the door open for further applications.

Because plaintiffs are not raising a regulatory takings claim and are challenging only the denial of the Project, the City Council’s unequivocal rejection of the Project satisfies the exhaustion requirement.

Plaintiffs contest the trial court’s ruling that defendants are immune from liability for tort damages under the Act. (§810 et seq.) We independently review the trial court’s construction and application of the Act. (Coito v. Superior Court (2012) 54 Cal.4th 480 , 488 [ 142 Cal.Rptr.3d 607 , 278 P.3d 860 ] [statutory construction]; Alvarez v. State of California (1999) 79

A. City Council Defendants

When it comes to tort suits against public employees, “ ‘the rule is liability, immunity is the exception.’ [Citation.]” (Ramos v. County of Madera (1971) 4 Cal.3d 685 , 692 [ 94 Cal.Rptr. 421 , 484 P.2d 93 ], limited on other grounds in Caldwell v. Montoya (1995) 10 Cal.4th 972 , 987, fn. 8 [ 42 Cal.Rptr.2d 842 , 897 P.2d 1320 ] (Caldwell); see § 820, subd. (a) [“Except as otherwise provided by statute . . . , a public employee is liable for injury caused by his act or omission to the same extent as a private person.”].) However, the Act declares that “a public employee is not liable for an injury resulting from his act or omission where the act or omission was the result of the exercise of the discretion vested in him, whether or not such discretion be abused.” (§ 820.2.) At the core of this immunity are “ ‘ “basic policy decisions.” ’ ” (Ogborn v. City of Lancaster (2002) 101 Cal.App.4th 448 , 460 [ 124 Cal.Rptr.2d 238 ].) Dovetailing neatly with this overarching immunity for discretionary policymaking, the Act also confers immunity upon public employees for “failing] to adopt an enactment” (§ 821) and for “denying]” or “refusing] to issue” “permit[s]” and “approvals]” (§ 821.2). The City Council defendants in this case are accordingly immune from tort damages under the Act. They are “public employees” (see § 811.4), and they are being sued for their discretionary legislative decision not to grant plaintiffs’ application for building permits and variances (see Ogborn, supra, at p. 462).

Plaintiffs challenge this conclusion on two grounds. We consider and reject each.

1. Liability for Misrepresentations Motivated by “Actual Fraud, Corruption or Actual Malice ”

Plaintiffs contend that the Act’s immunity for legislative policymaking is limited by the exception to the immunity conferred by a different provision of the Act, section 822.2. That section provides that “[a] public employee acting in the scope of his employment is not liable for an injury caused by his misrepresentation, whether or not such misrepresentation be negligent or intentional, unless he is guilty of actual fraud, corruption or actual malice.” (Ibid., italics added.) Plaintiffs assert that section 822.2’s exception should also operate as an exception to the immunities conferred by

The starting point for ascertaining legislative intent is the language used in the statute itself. (People v. Valladoli (1996) 13 Cal.4th 590 , 597 [ 54 Cal.Rptr.2d 695 , 918 P.2d 999 ].) The language here is ambiguous. On the one hand, sections 820.2, 821 and 821.2 do not themselves contain any exception for misrepresentations motivated by actual fraud, corruption or actual malice. In Tur v. City of Los Angeles (1996) 51 Cal.App.4th 897 [ 59 Cal.Rptr.2d 470 ], the court held that section 822.2’s exception did not apply when a public employee was relying on an immunity conferred by a different section of the Act. (Tur, supra, at pp. 902-903 [not applying § 822.2’s exception to immunity against malicious prosecution actions].) Tur seemingly rejects plaintiffs’ similar entreaty to export section 822.2’s exception to other immunities. On the other hand, if we follow the maxim that statutes are to be read “ ‘with reference to the entire scheme of law of which [they are a] part’ ” (People v. Pieters (1991) 52 Cal.3d 894 , 899 [ 276 Cal.Rptr. 918 , 802 P.2d 420 ], quoting Clean Air Constituency v. California State Air Resources Bd. (1971) 11 Cal.3d 801 , 814 [ 114 Cal.Rptr. 577 , 523 P.2d 617 ]), we could read section 822.2’s exception as an exception to every immunity conferred by the Act. Indeed, section 820.2 explicitly notes that its immunity may be abrogated “as otherwise provided by statute.”

When the plain language of a statute is inconclusive, we must look elsewhere for affirmative indications of legislative intent. (Pacific Palisades Bowl Mobile Estates, LLC v. City of Los Angeles (2012) 55 Cal.4th 783 , 803 [ 149 Cal.Rptr.3d 383 , 288 P.3d 717 ].) In this case, it is clear that the Legislature intended the immunity from tort liability attaching to legislative policymaking decisions to apply even when legislators acted with improper motives. Section 820.2 is the critical immunity provision here because the City Council defendants’ discretionary decision was voting against a resolution and thereby denying permits and variances. On these facts, section 820.2’s broader immunity embraces the more specific immunities for voting on resolutions and denying permits and variances conferred by sections 821 and 821.2.

The legislative committee’s comment indicates that section 820.2 was meant to “restate^ . . . pre-existing California law” (Legis. Com. coms.— Sen., 32 pt. 1 West’s Ann. Gov. Code (2012 ed.) foll. § 820.2, p. 360), and directs the reader to Lipman v. Brisbane Elementary Sch. Dist. (1961) 55

The logic underlying these cases applies even more forcefully in the context of legislators’ discretionary, policymaking decisions. Like all other public employees, legislators benefit from immunity that does not dissipate “ ‘upon mere allegation of improper motives or unlawful acts . . .’ ” because such immunity eliminates the “ ‘threat of personal liability . . .’ ” (Martelli v. Pollock (1958) 162 Cal.App.2d 655 , 659 [ 328 P.2d 795 ]), and frees public employees to exercise their “ ‘honest judgment uninfluenced by fear of consequences personal to themselves’ ” (White, supra, 37 Cal.2d at p. 732). In short, absolute immunity makes sure that “ ‘it is not a tort for Government to govern. .. .’ ” (HFH, Ltd. v. Superior Court (1975) 15 Cal.3d 508 , 519 [ 125 Cal.Rptr. 365 , 542 P.2d 237 ], quoting Dalehite v. United States (1952) 346 U.S. 15 , 57 [ 97 L.Ed. 1427 , 73 S.Ct. 956 ] (dis. opn. of Jackson, J.).)

With legislators, absolute immunity also furthers the separation of powers. The judiciary is not in the business of “ ‘inquiring] into the “motivation or mental processes” which may underlie action by a nonjudicial agency of government.’ ” (Blank v. Kirwan (1985) 39 Cal.3d 311 , 324 [ 216 Cal.Rptr. 718 , 703 P.2d 58 ], quoting In re Fain (1976) 65 Cal.App.3d 376 , 393, fn. 14 [ 135 Cal.Rptr. 543 ].) This is why an elected “official’s motives, no matter how self-interested they may be, cannot vitiate otherwise valid government action. [Citations.]” (Blank, supra, at p. 325.) A rule hinging tort immunity on whether legislators made misrepresentations motivated by “actual fraud, corruption or actual malice” (§ 822.2) would put legislators’ motives front and center. It would also put judges in the uncomfortable position of “questioning] the wisdom of . . . legislative decisions] through tort litigation. [Citation.]” (Wood v. County of San Joaquin (2003) 111 Cal.App.4th 960 , 972 [ 4 Cal.Rptr.3d 340 ]; see Caldwell, supra, 10 Cal.4th at

Even if our Legislature’s intent were not so clear, we are still required to construe statutes to be “ ‘consistent with justice and common sense . . .’ ” rather than to “ ‘lead[] to mischief or absurdity . . . .’ ” (Shoemaker v. Myers (1992) 2 Cal.App.4th 1407 , 1424 [ 4 Cal.Rptr.2d 203 ], quoting Lampley v. Alvares (1975) 50 Cal.App.3d 124 , 128-129 [ 123 Cal.Rptr. 181 ].) Plaintiffs’ proffered construction falls into this latter category because it would allow section 822.2’s exception to swallow the rule of immunity in sections 820.2, 821 and 821.2. By the simple expedient of specifically pleading that a legislator’s policy decision was motivated by fraud, malice or corruption, an unhappy constituent could subject that legislator to protracted pretrial litigation or trial, even if the legislator is ultimately vindicated. This threat of harassment and personal liability is precisely what the immunity in sections 820.2, 821 and 821.2 was enacted to prevent. Plaintiffs’ construction of the Act would accordingly “frustrate the legislative purpose” behind these immunities. (Shoemaker, supra, at pp. 1424-1425; see Barber v. Blue (1966) 65 Cal.2d 185 , 188 [ 52 Cal.Rptr. 865 , 417 P.2d 401 ].) We have rejected similar attempts to “abrogate” immunities by “maneuvering” the “rules of pleadings and procedure.” (O’Hagan v. Board of Zoning Adjustment (1974) 38 Cal.App.3d 722 , 730 [ 113 Cal.Rptr. 501 ]; accord, Land Waste Management v. Contra Costa County Bd. of Supervisors (1990) 222 Cal.App.3d 950 , 962-963 [ 271 Cal.Rptr. 909 ]; Mikkelsen v. State of California (1976) 59 Cal.App.3d 621 , 630 [ 130 Cal.Rptr. 780 ].)

By contrast, reading section 822.2’s exception for misrepresentations motivated by actual fraud, corruption or actual malice as not qualifying the tort immunity that otherwise attaches to legislators’ policymaking decisions best harmonizes the legislative intent behind all of these provisions. It effectuates the intent behind sections 820.2, 821 and 821.2 by eliminating the danger of harassment and chilling that springs from susceptibility to tort lawsuits while preserving oversight by criminal prosecution and by the electorate. At the same time, this construction appropriately circumscribes the immunity for misrepresentations conferred by section 822.2. Public employees not engaged in legislative or other discretionary policymaking remain liable for misrepresentations they make in the course of their employment if those misrepresentations (1) do not interfere with commercial or financial interests (Johnson v. State of California (1968) 69 Cal.2d 782 , 790-800 [ 73

B. The City

The City is a “public entity” presumptively immune from tort liability. (§§ 815, subd. (a), 811.2; McCarty v. Department of Transportation (2008) 164 Cal.App.4th 955 , 961 [ 79 Cal.Rptr.3d 777 ].) The Act nevertheless specifies the situations in which a public entity may be (1) directly liable for injuries (§§ 815.4, 815.6, 818.5) or (2) vicariously liable for injuries caused by its employees (§ 815.2, subd. (a); M.P. v. City of Sacramento (2009) 177 Cal.App.4th 121 , 128-129 [ 98 Cal.Rptr.3d 812 ]; accord, Bradford v. State of California (1973) 36 Cal.App.3d 16 , 20-21 [ 111 Cal.Rptr. 852 ] [public entity has both direct and vicarious liability].)

Plaintiffs allege that the City is liable for two reasons. First, they argue that the City is vicariously liable for the City Council defendants’ actionable misrepresentations, even though the City cannot be held directly liable for any misrepresentations under section 818.8. We reject this argument for two reasons. As we discuss above, the City Council defendants are themselves immune. Because they are immune, so is the City. (§ 815.2, subd. (b) [“a public entity is not liable for an injury resulting from an act or omission of an employee of the public entity where the employee is immune from liability”].) Even if we had concluded that section 822.2’s exception applied to the City Council defendants and rendered them potentially liable, it is well settled that section 818.8 confers upon public entities an absolute immunity for all misrepresentations, and that this immunity trumps any vicarious liability for egregious misrepresentations of its employees actionable against the employees themselves. (Harshbarger v. City of Colton (1988) 197 Cal.App.3d 1335 ,1340-1341 [ 243 Cal.Rptr. 463 ]; Universal By-Products, Inc. v. City of Modesto (1974) 43 Cal.App.3d 145 , 154 [ 117 Cal.Rptr. 525 ].)

Second, plaintiffs argue that section 815.3, subdivision (a), renders the City jointly liable in tort as long as the City is named in their complaint as a codefendant with an “elected official.” We disagree. Section 815.3 erects a rule of pleading requiring a public entity to be named as a joint tortfeasor before judgments against an elected official may be enforced against that

Because the trial court ruled that plaintiffs had not exhausted their administrative remedies, it had no occasion to decide the propriety of plaintiffs’ request for mandamus relief. The Act’s immunity reaches only “personal tort liability” and does not immunize against or otherwise preclude mandamus review. (Masters, supra, 32 Cal.App.4th at p. 47, fn. 11.) Because plaintiffs’ prayer for mandamus relief has yet to be considered, we would ordinarily remand the issue to the trial court. However, we conclude that remand would be futile because plaintiffs are not entitled to this relief as a matter of law. (Aryeh v. Canon Business Solutions, Inc. (2012) 55 Cal.4th 1185 , 1191 [ 151 Cal.Rptr.3d 827 , 292 P.3d 871 ].)

Plaintiffs ground their request for mandamus on three theories. First, they seek an order compelling defendants to grant their application because City Council members had so promised. This is indistinguishable from a claim that defendants are estopped by their prior statements, and estoppel does not lie against the government in this context. (Toigo v. Town of Ross (1998) 70 Cal.App.4th 309 , 321-324 [ 82 Cal.Rptr.2d 649 ].)

Second, plaintiffs seek a new hearing before the City Council because the City Council’s review did not comply with procedural due process. A viable due process claim rests on the deprivation of a protected property interest. Because plaintiffs had no entitlement to a permit or variance at the time the City Council rejected their application (Clark v. City of Hermosa Beach (1996) 48 Cal.App.4th 1152 , 1182-1183 [ 56 Cal.Rptr.2d 223 ]), they lack the necessary predicate for a procedural due process claim.

Lastly, plaintiffs allege that the defendants did not “follow legal standards.” Because public agencies are presumed to regularly perform their official duty (Evid. Code, § 664; Moore v. Twentynine Palms County Water Dist. (1957) 156 Cal.App.2d 109 , 111 [ 318 P.2d 751 ] [presumption applies at demurrer stage]), a plaintiff must plead sufficient facts to overcome that presumption (Schwartz v. Poizner (2010) 187 Cal.App.4th 592 , 599 [ 113 Cal.Rptr.3d 610 ]; Romero v. County of Santa Clara (1970) 3 Cal.App.3d 700 , 703-704 [ 83 Cal.Rptr. 758 ]). Plaintiffs’ bare allegation that defendants did not “follow legal standards,” without more, is insufficient. Moreover, because plaintiffs have not sought to provide any additional explication to the trial court or this court, we conclude that plaintiffs have not established “a reasonable possibility” that this defect can be cured by further amendment of their complaint. (Reynolds, supra, 36 Cal.4th at p. 1091.)

The judgment is affirmed. Costs on appeal are awarded to defendants.

Yegan, Acting P. J., and Perren, J., concurred.