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Owen v. City of San Bernardino

COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO
Aug 2, 2011
No. E050946 (Cal. Ct. App. Aug. 2, 2011)

Opinion

E050946 Super.Ct.No. CIVDS900487

08-02-2011

ROBERT OWEN, Plaintiff and Appellant, v. CITY OF SAN BERNARDINO, Defendant and Respondent.

The Myers Law Group, David P. Myers and D. Smith for Plaintiff and Appellant. James F. Penman, City Attorney, and Donn Dimichele, Deputy City Attorney, for Defendant and Respondent.


NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

OPINION

APPEAL from the Superior Court of San Bernardino County. Christopher J. Warner, Judge. Affirmed.

The Myers Law Group, David P. Myers and D. Smith for Plaintiff and Appellant.

James F. Penman, City Attorney, and Donn Dimichele, Deputy City Attorney, for Defendant and Respondent.

Robert Owen, plaintiff, was employed by the City of San Bernardino (City), defendant, until he was terminated for insubordination, dishonesty, violation of department or division work rules, and neglect of duty. He appealed the termination before the Civil Service Board of the City of San Bernardino (CSB) but did not assert his termination was retaliatory, or that it violated his civil rights, in those proceedings. His termination was upheld by CSB and plaintiff then brought a suit against the City for violation of his civil rights on the ground his termination was in retaliation for his whistle-blowing act of reporting his supervisor's misuse of City resources. The City's demurrer to the first amended complaint was sustained without leave to amend on the ground plaintiff was precluded by the adverse decision of CSB under principles of collateral estoppel due to plaintiff's failure to exhaust his remedies by way of a petition for writ of mandamus. Plaintiff appeals, challenging that determination, and arguing that his federal claims were not barred by the doctrines of res judicata or collateral estoppel. We affirm.

BACKGROUND

Because this appeal follows the sustaining of a demurrer, we summarize the underlying facts as alleged in the complaint. (Landmark Screens, LLC v. Morgan, Lewis & Bockius, LLP (2010) 183 Cal.App.4th 238, 240.) Our summary also includes facts subject to judicial notice. (Evans v. City of Berkeley (2006) 38 Cal.4th 1, 6.)

In reviewing a trial court's ruling sustaining a demurrer, we are limited to the facts alleged on the face of the pleading and those properly subject to judicial notice. (Zelig v. County of Los Angeles (2002) 27 Cal.4th 1112, 1126.)

Plaintiff was employed as an electrician for the City for approximately eight years. As a City employee, plaintiff;'s workday began at 7:00 a.m. and ended at 3:30 p.m., with two 15-minute breaks, and a lunch break of 30 minutes. By a department directive, all employees were required to take their lunch break at 11:30 a.m., unless the employee's supervisor approved a change of schedule, but lunch could not exceed 30 minutes.

In June 2006, the civil service commission found that plaintiff was dishonest for lying to his supervisor concerning the use of his work truck, not complying with work rules regarding his lunch break, failing to clock out in a timely manner and lying to his supervisor regarding repairs completed on a signal light. On July 25, 2006, plaintiff was suspended for one day for going to a fast food restaurant during working hours in a City vehicle, respecting this incident.

On March 15, 2007, plaintiff's supervisor directed plaintiff and another employee to perform maintenance at a particular location. The supervisor further instructed plaintiff to break for lunch prior to performing the service. However, plaintiff and his coworker informed the supervisor that they had already taken a lunch break, so they were directed by the supervisor to go straight to the location where the maintenance service was to be performed.

A short time later, plaintiff was seen at city hall by the deputy director of maintenance services who asked plaintiff why he was there. Plaintiff explained he was dropping off paperwork at the human resources department for the Federal Medical Leave Act (FMLA), and admitted he did not have permission to be there. However, plaintiff informed the individual that he was on his lunch break and that he was required to personally deliver the documents. The civil service commission determined that he was never ordered by the human resources department to deliver the FMLA documents in person, and there is no requirement that FMLA documents be delivered in personally. The CSB determined that plaintiff did not have permission to change his lunch hour, and that plaintiff misrepresented that he was loading a work truck during his lunch period.

On May 8, 2007, the civil service commission ordered a 5 percent reduction of plaintiff's pay for 12 pay periods, after he was accused of attending a bake sale, which had been sponsored by the City, for an excessive period of time, without permission. The commission found plaintiff had committed inexcusable neglect of duty, dishonesty, and violation of department or division work rules.

On December 11, 2007, an administrative hearing was held regarding the decision to terminate plaintiff. Plaintiff was present at the hearing, with a representative from the San Bernardino Public Employees Association. Witnesses testified at the hearing and documents were submitted before the matter was submitted for decision. The CSB unanimously upheld the decision of the director of public services to terminate plaintiff due to plaintiffs failure, after two prior disciplinary actions before the CSB, to understand that he was required to follow the established rules and policies of the department, including taking lunch at the appropriate time and lying about not complying with the hours of break for lunch.

The record of the administrative proceeding has not been provided as part of the record on appeal. However, the findings of the CSB do not mention any claim by plaintiff that his termination was in retaliation for whistle-blowing activity, and plaintiff does not allege that he presented such a defense at the administrative hearing. We therefore conclude plaintiff did not present any evidence to the CSB regarding a possible retaliatory motive for his termination.

The findings of fact and statement of decision were accompanied by a notice of time limits for filing petition for writ of mandate, and were served by mail on July 14, 2008. On May 26, 2009, plaintiff filed his first amended complaint for damages alleging a violation of his civil rights (42 U.S.C. § 1983), and violation of his First Amendment rights. In this complaint, plaintiff alleged he was terminated from his employment in retaliation for reporting fraud and waste within the City, including misuse of City resources by his direct supervisor. Plaintiff noticed that his relationship with his supervisors changed drastically after he made his complaint, fellow employees warned plaintiff that his supervisor was out to get him, and plaintiff noticed he was receiving a disproportionate share of less desirable assignments. The complaint also alleged plaintiff was performing employer-related business when he delivered his leave paperwork to city hall, and that he had been informed that it was proper for him to deliver his medical leave requests there.

The complaint fails to state when he was warned that his supervisors were out to get him, or when he received undesirable assignments, or whether he presented this information at the administrative hearing to review his termination.

On June 25, 2009, the City demurred to the first amended complaint on the ground that the court lacked jurisdiction over the subject matter, and the complaint failed to state facts sufficient to constitute a cause of action. On December 8, 2009, the trial court sustained the City's demurrer to both causes of action without leave to amend. The court concluded that plaintiff's failure to exhaust his judicial remedies was a bar to the litigation. On March 23, 2010, the court entered a judgment of dismissal following the order sustaining the demurrer. On May 20, 2010, plaintiff appealed.

DISCUSSION

Plaintiff asserts that the trial court erred in sustaining the demurrer without leave to amend because his federal causes of action were not barred by the doctrine of failure to exhaust administrative or judicial remedies, or the doctrines of res judicata or collateral estoppel. He also argues the City waived (forfeited) any application of the doctrines of res judicata and collateral estoppel to the second cause of action for violation of his First Amendment rights. In the alternative, he argues his pleading is curable by amendment respecting additional claims. We disagree.

In reviewing the sufficiency of a complaint against a demurrer, we treat the demurrer as admitting all material facts properly pleaded, but we do not assume the truth of contentions, deductions or conclusions of law. (Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967.) We liberally construe the pleading to achieve substantial justice between the parties, giving the complaint a reasonable interpretation and reading the allegations in context. (Code Civ. Proc., § 452; Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1081.) The judgment must be affirmed if it is correct on any ground stated in the demurrer, regardless of the trial court's stated reasons. (Aubry, at p. 967; Fremont Indemnity Co. v. Fremont General Corp. (2007) 148 Cal.App.4th 97, 111.) If another proper ground for sustaining the demurrer exists, this court will still affirm the demurrer even if the trial court relied on an improper ground. (Jocer Enterprises, Inc. v. Price (2010) 183 Cal.App.4th 559, 566, citing Cantu v. Resolution Trust Corp. (1992) 4 Cal.App.4th 857, 879, fn. 10.)

When a demurrer is sustained, we must determine de novo whether the complaint alleges facts sufficient to state a cause of action under any legal theory. (McCall v. PacifiCare of Cal., Inc. (2001) 25 Cal.4th 412, 415.) When a demurrer is sustained without leave to amend, we must also decide whether there is a reasonable possibility that the defect can be cured by amendment. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) If the complaint can be cured, the trial court has abused its discretion in sustaining without leave to amend. (Ibid; see also Arce v. Kaiser Foundation Health Plan, Inc. (2010) 181 Cal.App.4th 471, 481-482.)

1. Plaintiff's Failure to Pursue Judicial Remedies Bars a Civil Action for Violation of His Federal Civil Rights.

Plaintiff asserts that his federal causes of action are not barred by the doctrines of failure to exhaust administrative or judicial remedies. It is true that where the governmental action being challenged by a federal civil rights lawsuit is not the result of a quasi-judicial hearing, a plaintiff is not required to first seek another state judicial remedy. (McDaniel v. Board of Education (1996) 44 Cal.App.4th 1618, 1622, citing Felder v. Casey (1988) 487 U.S. 131, 147 [108 S.Ct. 2302, 101 L.Ed.2d 123].) However, plaintiff's claim is not for discriminatory employment practices, and he participated in a quasi-judicial administrative proceeding, which he failed to pursue, resulting in an adverse decision which became final.

Title VII of the Civil Rights Act (42 U.S.C. § 2000e et seq., 78 Stat. 253, 255) prohibits discrimination as an unlawful employment practice. Title VII bars, as an unlawful employment practice, the failure or refusal to hire or to discharge any individual because of the individual's race, color, religion, sex, or national origin. (42 U.S.C. § 2000e-2(a)(1).) Similarly, Title VII makes it an unlawful employment practice for an employer to discriminate against any of his employees or applicants for employment because the employee or applicant has attempted to protest or correct allegedly discriminatory conditions of employment. (42 U.S.C. § 2000e-3(a).)

Plaintiff's complaint alleges he was discharged in retaliation for his whistle-blowing action of reporting his supervisor's misuse of public resources. Plaintiff's claim does not allege he was fired in retaliation for opposing discriminatory policies of the City, nor does it allege he was fired because he was a member of a protected class. Therefore, plaintiffs claim does not present an unlawful employment practice under Title VII. This is a significant point because the exemption from exhausting administrative or judicial or quasi-judicial remedies applies only to actions brought under Title VII. (Johnson v. City of Loma Linda (2000) 24 Cal.4th 61, 65, 77.)

Administrative remedies are different from judicial or quasi-judicial remedies. The requirement of exhaustion of judicial remedies to prevent preclusion is distinguishable from the jurisdictional requirement of exhausting administrative remedies. (Johnson v. City of Loma Linda, supra, 24 Cal.4th at p. 70.) Prior decisions have made it clear that a plaintiff is not required to exhaust administrative remedies prior to bringing a civil action under either the California Fair Employment and Housing Act (FEHA; Gov. Code, § 12900 et seq.) or for violation of his civil rights because Congress did not intend unreviewed state administrative proceedings to have preclusive effect on title VII claims. (Swartzendruber v. City of San Diego (1992) 3 Cal.App.4th 896, 910 [overruled on a different point in Johnson, at p. 72].) However, it is also true that in enacting the federal civil rights statute, Congress did not intend to create an exception to the general rules of preclusion of administrative adjudications. (Briggs v. City of Rolling Hills Estates (1995) 40 Cal.App.4th 637, 646-647.)

The doctrine of exhaustion of judicial remedies is distinct from the jurisdictional rule that requires exhaustion of administrative remedies before filing suit in certain circumstances. (Y.K.A. Industries, Inc. v. Redevelopment Agency of City of San Jose (2009) 174 Cal.App.4th 339, 355, citing Knickerbocker v. City of Stockton (1988) 199 Cal.App.3d 235, 240-244.) It is a form of res judicata, giving collateral estoppel effect to the administrative agency's decision, because that decision has achieved finality due to the aggrieved party's failure to pursue the exclusive judicial remedy to review the administrative action. (Y.K.A., at p. 355.) The doctrine of exhaustion of judicial remedies is invoked where there has been a quasi-judicial adjudication by an administrative tribunal, whether in the public or private context. (Ibid.; see also Astoria Federal Sav. & Loan Assn. v. Solimino (1991) 501 U.S. 104, 107 [111 S.Ct. 2166, 115 L.Ed.2d 96] [extending the doctrine to final adjudications of both state and federal agencies].)

To determine whether an agency acted in a judicial capacity, the court considers the presence of factors indicating that the administrative proceedings and determination possessed a judicial character. (Imen v. Glassford (1988) 201 Cal.App.3d 898, 907.) Indicia of the judicial character of a proceeding include whether (1) the administrative hearing was conducted in a judicial-like adversary proceeding; (2) the proceedings required witnesses to testify under oath; (3) the agency determination involved the adjudicatory application of rules to a single set of facts; (4) the proceedings were conducted before an impartial hearing officer; (5) the parties had the right to subpoena witnesses and present documentary evidence; and (6) the administrative agency maintained a verbatim record of the proceedings. (Ibid.; see also Murray v. Alaska Airlines, Inc. (2010) 50 Cal.4th 860, 867-868, citing Pacific Lumber Co. v. State Water Resources Control Bd. (2006) 37 Cal.4th 921, 944.)

Where the decision is of a sufficiently judicial character to support collateral estoppel, once an administrative decision has been issued, respect for the administrative decision-making process requires that the prospective plaintiff continue that process to completion. (McDonald v. Antelope Valley Community College Dist. (2008) 45 Cal.4th 88, 113.) In such situations, if an individual avails himself or herself of a judicial or quasi-judicial administrative review of a negative employment decision and fails to overturn an adverse decision, that decision will have binding, and thus preclusive, effect. (Murray v. Alaska Airlines, Inc., supra, 50 Cal.4th at p. 867.) Thus, where a state agency, acting in a proceeding in a judicial capacity, resolves disputed issues of fact properly before it, which the parties have had adequate opportunity to litigate, federal courts must give the agency's factfinding the same preclusive effect it would have in state courts. (University of Tennessee v. Elliott (1986) 478 U.S. 788, 796-799 [106 S.Ct. 3220, 92 L.Ed.2d 635].)

The preclusive effect applies not only to claims or defenses presented in the administrative hearing, but also to claims or defenses which were not raised in the administrative quasi-judicial proceedings, and to defaults. (Murray v. Alaska Airlines, Inc., supra, 50 Cal.4th at p. 871.) This includes the failure to raise constitutional claims as defenses in the administrative hearing will preclude a claimant from raising those claims later in court. (Takahashi v. Board of Education (1988) 202 Cal.App.3d 1464, 1481 [final judgment serves as a bar not only to the issues litigated but to those that could have been litigated at the same time].) The United States Supreme Court has held that principles of res judicata and collateral estoppel apply to actions brought under federal civil rights statutes. (University of Tennessee v. Elliott, supra, 478 U.S. at pp. 796-797.)

It follows that if a party initiates an administrative proceeding which is quasi-judicial in nature, fails to present civil rights claims as defenses in that administrative hearing, and then fails to seek review of an adverse decision by the administrative agency, he will be precluded from bringing a civil suit for damages under principles of collateral estoppel. (Murray v. Alaska Airlines, Inc., supra, 50 Cal.4th at p. 876.) Plaintiff acknowledged in the trial court that he did not present his whistle-blower defense or his civil rights claims in the administrative proceedings before CSB.

Based on these authorities, plaintiff's contention that the doctrines of res judicata and collateral estoppel are inapplicable because his action is asserted under the Civil Rights Act, is mistaken. (Briggs v. City of Rolling Hills Estates, supra, 40 Cal.App.4th at p. 646, citing Swartzendruber v. City of San Diego, supra, 3 Cal.App.4th at pp. 903-904.) In Swartzendruber, at page 909, the court held that there was no justification for plaintiffs position that she should be permitted to recover damages for violations of her civil rights which led to her discharge, where she failed to assert those reasons at the administrative hearing.

Plaintiff had a choice: he could either pursue his civil service remedies to completion, or he could pursue the judicial remedies provided by FEHA or the federal Civil Rights Act. (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1086-1087.) The record shows the proceedings conducted before the CSB were quasi-judicial, not purely administrative, because the proceedings (1) were conducted in a judicial-like adversary proceeding; (2) permitted the parties to call witnesses to testify, (3) led to a determination involving the adjudicatory application of rules to a single set of facts; (4) were conducted before the CSB, an impartial board; and (5) assured the parties had the right to subpoena witnesses and present documentary evidence. Additionally, the parties were assured the right to a verbatim transcript, although the party desiring a record was required to request and pay for a court reporter. The format of the "hearing" was decidedly judicial in nature, including opening statements, the presentation of evidence, both by documentary and by live witnesses, cross-examination of opposing witnesses, final argument, and submission for decision.

The adverse decision flowing from the quasi-judicial CSB hearing was therefore entitled to preclusive effect unless plaintiff successfully overturned it in a mandamus proceeding. Plaintiff chose not to pursue judicial review of the adverse decision by the CSB. This judgment, which was entitled to preclusive effect under state and federal law, bars any Title VII federal claim and any federal civil rights claim under 42 United States Code section 1983. (Johnson v. City of Loma Linda, supra, 24 Cal.4th at pp. 69-70, 71, 75, 77.) The trial court correctly sustained the demurrer.

2. The Demurrer to the Cause of Action for Violation of Plaintiff's First Amendment Rights Under the Federal Constitution Was Properly Sustained.

Plaintiff asserts that defendant failed to assert a collateral estoppel or res judicata defense to the second cause of action alleging a violation of plaintiff's First Amendment right to free speech. We disagree.

The demurrer interposed by the City was addressed to both causes of action. ("The Demurrer is made pursuant to Code of Civil Procedure §430.10(a) on the ground that the Court has no jurisdiction of the subject causes of action alleged in the Complaint and/or Code of Civil Procedure §430.10(e) on the ground that the Complaint fails to set forth facts constituting a legally sufficient cause of action against these defendants." [Italics in original.])

Plaintiff does not point to any specific allegation in the demurrer that is targeted at the first cause of action only and our review of the demurring papers show that it is generic in addressing the entire complaint, as a whole, rather than a particular claim in the complaint. Sub-arguments "A" and "B" of the points and authorities in support of the demurrer generally claim that the decision by the CSB has preclusive effect, under the doctrines of res judicata and collateral estoppel, barring the "suit" or "action." It was not limited to a single cause of action. Despite the fact that the City included subdivision-argument "C," specifically addressing the civil rights claim, and a separate sub-argument, "D," pertaining to the First Amendment claim, the demurrer adequately raised the objection to the entire complaint, including the second cause of action.

In any event, plaintiff's papers submitted in opposition to the demurrer addressed the preclusive effect of the administrative decision as to both causes of action. Additionally, at the initial hearing on the demurrer, where the court announced its tentative decision to apply the doctrine of preclusive effect to the entire complaint, and continued the matter to allow the parties to submit supplemental briefing, plaintiff did not complain that the court was improperly applying collateral estoppels to both causes of action. The demurrer was properly sustained as to both causes of action on the grounds stated.

3. Because Plaintiff Failed to Exhaust Administrative/Judicial Remedies, No Amendment Could Cure the Defect.

Plaintiff claims his pleading is curable by amendment respecting additional claims under the FMLA, asserting it was error to sustain the demurrer without leave to amend. We disagree.

As we have explained in section 1, plaintiff submitted to a hearing before the CSB and is bound by the decision rendered in that proceeding. Plaintiff failed to present any FMLA challenge to the propriety of his discharge. As with his constitutional claims discussed ante, his failure to raise such a statutory defense in the quasi-judicial administrative proceeding bars him from raising such a claim in a subsequent civil action for damages. (Murray v. Alaska Airlines, Inc., supra, 50 Cal.4th at p. 871; Takahashi v. Board of Education, supra, 202 Cal.App.3d at p. 1481.) The trial court properly granted the demurrer without leave to amend.

DISPOSITION

The judgment is affirmed. The City is awarded costs on appeal.

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

Ramirez

P.J.

We concur:

McKinster

J.

Miller

J.


Summaries of

Owen v. City of San Bernardino

COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO
Aug 2, 2011
No. E050946 (Cal. Ct. App. Aug. 2, 2011)
Case details for

Owen v. City of San Bernardino

Case Details

Full title:ROBERT OWEN, Plaintiff and Appellant, v. CITY OF SAN BERNARDINO, Defendant…

Court:COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO

Date published: Aug 2, 2011

Citations

No. E050946 (Cal. Ct. App. Aug. 2, 2011)