Opinion
B228440
11-02-2011
JOSE DIAZ, Plaintiff and Respondent, v. GEORGE W. SHACKELFORD, Defendant and Appellant.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
Los Angeles County Super. Ct. No. BC369770
APPEAL from a judgment of the Superior Court of Los Angeles County. Soussan G. Bruguera, Judge. Affirmed.
Matthew C. Long for Defendant and Appellant.
Law Offices of Peter Beck and Peter Beck for Plaintiff and Respondent.
This is the second appeal involving these parties. In the prior appeal, defendant and appellant George W. Shackelford (defendant) challenged a trial court judgment awarding damages to plaintiff and respondent Jose Diaz (plaintiff) arising from a labor claim. He contended, inter alia, that the trial court judgment violated the doctrine of res judicata and that the trial court failed to prepare a proper statement of decision.
Finding that the trial court's statement of decision contravened Code of Civil Procedure sections 632 and 634, we reversed the judgment and remanded the matter for the preparation of a statement of decision that addressed defendant's affirmative defenses of res judicata and jurisdiction based upon action of the Labor Commissioner.
Upon remand, the trial court rejected defendant's affirmative defense of res judicata. Defendant appeals, arguing that the trial court erred in finding that res judicata did not apply.
We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff was employed as a Laundromat janitor for defendant from January 6, 2002, to April 18, 2006. Because he believed that he worked approximately 59 hours per week without receiving any overtime pay, plaintiff filed an initial claim form with the State Labor Commissioner on April 21, 2006. Thereafter, plaintiff filed an amended complaint with the Labor Commissioner on September 22, 2006. The amended complaint failed to include claims for overtime pay; it only included claims of missed meal and rest breaks and split shift premiums.
Defendant answered the amended complaint, denying plaintiff's allegations that he was denied meal and/or rest periods. Defendant also disputed plaintiff's entitlement to a split shift premium.
Following a hearing, the Labor Commissioner rendered her decision. Preliminarily, she noted that plaintiff's claim raised allegations of missed lunch breaks, rest period violations, and split shift premiums. After reviewing the evidence, the Labor Commissioner only awarded plaintiff $423 in split shift premiums.
On April 19, 2007, plaintiff filed the instant action for unpaid overtime against defendant. Defendant answered, asserting as an affirmative defense "that by accepting the benefits of the Labor Commissioner's award[,] the matter is now final and is res judicata."
Defendant filed a motion for summary judgment, arguing that "[p]laintiff accepted the benefit of the Commissioner's decision. He elected to receive the funds awarded by the Commissioner and not to have a trial on all issues. Again, the decision that it is believed that plaintiff will rely on[,] i.e.[, Murphy v. Kenneth Cole Productions, Inc. (2007) 40 Cal.4th 1094 (Murphy)] is a further proceeding after the Commissioner's decision by a timely filed appeal and a trial de novo. [¶] Plaintiff will be unable to show a single case that supports the [principle] that an employee can maintain dual venues to address his grievance after proceeding in one to its conclusion. To follow what is believed to be plaintiff's reasoning, plaintiff could have filed a civil action and after that has concluded, then file an administrative action. [¶] Plaintiff has . . . to file an appeal and therefore, as a matter of law, the court lacks the jurisdiction to entertain the present action."
Plaintiff apparently filed an opposition, and we assume that the trial court denied defendant's motion because the case proceeded to trial.
During trial, one of the contested issues was whether plaintiff could proceed with his claim for damages in a civil action after having pursued a wage claim before the Labor Commissioner.
Following the bench trial, the trial court ruled in favor of plaintiff, awarding him unpaid overtime pay in the amount of $20,124.42 and a $4,000 penalty for failing to provide itemized records for each pay period, as required by Labor Code sections 1194, 218.6, and 226, subdivision (e). The trial court's statement of decision did not address defendant's affirmative defense "that by accepting the benefits of the Labor Commissioner's award[,] the matter is now final and is res judicata." Defendant objected to the statement of decision for failing to make a "finding of fact or conclusion of law regarding the issue of res judicata in this matter arising from the Labor Commissioner hearing." Defendant's objections were overruled.
Judgment was entered, and defendant appealed. On November 17, 2009, we reversed the trial court judgment, finding that the trial court's statement of decision was inadequate because it failed to address the question of whether plaintiff's pursuit of a claim with the Labor Commissioner barred his claim in a civil action. We remanded the matter to the trial court for the issuance of a statement of decision on the issues of res judicata and whether plaintiff was barred from pursuing a claim in a civil action for unpaid overtime. (Diaz v. Shackelford (Nov. 17, 2009) B212349 [nonpub. opn.].)
On October 20, 2010, the trial court issued an amended statement of decision, rejecting defendant's res judicata defense. It found: "It is undisputed that the Labor Commissioner drafted the complaint on behalf of the Plaintiff. The amended complaint filed by the Labor Commissioner on the behalf of Plaintiff did not include any claims for unpaid overtime pay." As such, "the Labor Commissioner's Order dated December 5, 2006 did not even address or decide the issue of unpaid overtime pay of Plaintiff. [Citation.] The Labor Commissioner only decided in favor of Plaintiff in regards to split shift premiums . . . but against Plaintiff in regards to missed meal and rest breaks." Because "[t]he cause of action for unpaid overtime wages is a separate cause of action from split time wages[, defendant's] defense of res judicata does not apply in this matter."
Furthermore, the trial court rejected defendant's claim that because plaintiff failed to request a trial de novo following the Labor Commissioner's decision, he lost the opportunity to seek unpaid overtime wages. "It is undisputed that Plaintiff was not represented by counsel when he filed a claim with the [L]abor [C]ommissioner. It is also undisputed that the Labor Commissioner does not represent the Plaintiff or is his advocate. If the Labor Commissioner failed to include overtime wages in the complaint, the Plaintiff should not be penalized for [that] oversight. Plaintiff should have the opportunity to file a civil suit as matter of constitutional right."
Citing Pressler v. Donald L. Bren Co. (1982) 32 Cal.3d 831, 837 and Murphy, supra, 40 Cal.4th 1094, the trial court noted that "[f]ndamental to the protection afforded workers in this State are the wage and hour laws that prevent workers at the low end of the wage scale from being exploited and underpaid." It follows that plaintiff should be allowed to pursue his claim for overtime wages, particularly because he appeared in propria persona before the Labor Commissioner and defendant was represented by counsel during those proceedings.
Defendant timely appealed the judgment.
DISCUSSION
Defendant argues that the trial court judgment must be reversed because it violates the doctrine of res judicata. According to defendant, once plaintiff elected to seek relief for labor claims via an administrative hearing before the Labor Commissioner, he could not seek damages in a civil action.
The California Supreme Court has recently provided an extensive overview of the administrative wage claim process (Lab. Code, § 98 et seq.). "An employee pursuing a wage-related claim '"has two principal options. The employee may seek judicial relief by filing an ordinary civil action against the employer for breach of contract and/or for the wages prescribed by statute. [Citation.] Or the employee may seek administrative relief by filing a wage claim with the [commissioner] pursuant to a special statutory scheme codified in [Labor Code] sections 98 to 98.8 . . . ."' [Citations.]" (Murphy, supra, 40 Cal.4th at p. 1115.)
If an employee elects to seek administrative relief and the Labor Commissioner conducts an administrative hearing, then, within 15 days after the hearing is concluded, the Labor Commissioner must file a copy of his or her order, decision, or award and serve notice thereof on the parties. (Smith v. Rae-Venter Law Group (2002) 29 Cal.4th 345, 356, overruled by statute on other grounds as stated in Sonic-Calabasas A, Inc. v. Moreno (2011) 51 Cal.4th 659, 674, fn. 2.) "'Within 10 days after service of notice, the parties may seek review by filing an appeal to the municipal or superior court "in accordance with the appropriate rules of jurisdiction, where the appeal shall be heard de novo."'" (Ibid.; see also Murphy, supra, 40 Cal.4th at p. 1116.) "'Although denoted an "appeal," unlike a conventional appeal in a civil action, hearing under the Labor Code is de novo. [Citation.] "'A hearing de novo [under Labor Code section 98.2] literally means a new hearing,' that is, a new trial." [Citation]. The decision of the commissioner is "entitled to no weight whatsoever, and the proceedings are truly 'a trial anew in the fullest sense.'" [Citation.] The decision of the trial court, after de novo hearing, is subject to a conventional appeal to an appropriate appellate court. [Citation.] Review is of the facts presented to the trial court, which may include entirely new evidence. [Citations].'" (Smith v. Rae-Venter Law Group, supra, at pp 356-357; Murphy, supra, at p. 1116.)
Here, plaintiff elected to seek administrative relief of his claims for meal break violations and split shift premiums. He did not seek an administrative hearing for his unpaid overtime claim. And, plaintiff did not file an appeal of the Labor Commissioner's decision, at which time he could have raised an additional claim for unpaid overtime. (See, e.g., Murphy, supra, 40 Cal.4th at p. 1117.) Instead, he separately filed a civil action, seeking damages for unpaid overtime, an issue not considered by the Labor Commissioner. While perhaps not the most judicious use of resources, plaintiff was free to do so.
In Murphy, an employee "filed a wage claim with the Labor Commissioner, only raising claims for unpaid overtime and waiting-time penalties, unaware he could also assert claims for meal and rest period and itemized pay statement violations. After the Labor Commissioner issued a decision in [the employee's] favor, [the employer] filed a notice for de novo review, vesting jurisdiction in the superior court. [The employee] . . . filed [a new notice of claims], asserting claims for meal and rest period and itemized pay statement violations in addition to the claims for unpaid overtime, interest, and waiting-time penalties. [The employer] objected to the introduction of the new claims, but the trial court overruled the objection." (Murphy, supra, 40 Cal.4th at p. 1114.) After summarizing the administrative wage claim process, the Supreme Court considered "whether the trial court properly permitted additional related wage claims in the de novo trial that were not first considered by the Labor Commissioner." (Murphy, supra, at p. 1116.)
The Supreme Court concluded that the trial court did not err, commenting that "[a]n employee need not administratively exhaust his claim before filing a civil action." (Murphy, supra, 40 Cal.4th at p. 1117.) Moreover, while the Supreme Court held that the employee could raise additional related wage claims at the de novo trial, it expressly noted that the employee was not required to do so. After all, the employee "could have filed a separate civil complaint raising the additional wage claims, at which point the trial court could have consolidated the civil action with the de novo proceeding and considered all of the claims together." (Id. at p. 1118; see also id. at p. 1119 [acknowledging that an employee can file a civil complaint and a separate wage claim before the Labor Commissioner and simultaneously pursue both avenues, yet opining that that is not a favorable procedure].)
As recognized by Murphy, plaintiff was not required to resolve all of his wage-related claims before the Labor Commissioner. And, nothing in Murphy required plaintiff to raise any additional wage claims in a trial de novo, as opposed to a newly-filed civil action. It follows that the trial court properly considered plaintiff's unpaid overtime claim. The doctrine of res judicata does not apply.
As the trial court aptly noted, this conclusion is particularly compelling given the unchallenged finding by the trial court that plaintiff appeared in propria persona before the Labor Commissioner and defendant was represented by counsel.
Finally, we reject defendant's assertion that allowing plaintiff to pursue a civil action for unpaid overtime, which was not sought before the Labor Commissioner, improperly allows plaintiff to split causes of action. We cannot agree. Plaintiff's right to receive overtime wages is a primary right, separate and apart from his right to compensation for split shift premiums. (Lab. Code, § 1194; Cal. Code Regs., tit. 8, § 11040, subd. 2(Q) & 4(C).)
This right is also distinct from his right to compensation for missed meal breaks, a claim that plaintiff pursued, but did not prove, before the Labor Commissioner. (Lab. Code, § 226.7)
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DISPOSITION
The judgment is affirmed. Plaintiff is entitled to costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
____________, J.
ASHMANN-GERST
We concur: ____________, P. J.
BOREN
____________, J.
CHAVEZ