Filed 9/18/13

CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION TWO

BENJAMIN NATKIN,

Plaintiff and Appellant,

v.

CALIFORNIA UNEMPLOYMENT 

INSURANCE APPEALS BOARD,

Defendant and Respondent.

 B241949

 (Los Angeles County

 Super. Ct. No. BS131831)

APPEAL from a judgment of the Superior Court of Los Angeles County. Ann I. 

Jones, Judge. Affirmed.

Benjamin Natkin, in pro. per., for Plaintiff and Appellant.

Kamala D. Harris, Attorney General, Julie Weng-Gutierrez, Assistant Attorney 

General, Richard Waldo, Leslie P. McElroy, and Eric D. Bates, Deputy Attorneys 

General for Defendant and Respondent.
2

Benjamin Natkin (appellant) appeals from the denial of his petition for writ of 

mandate and administrative mandate filed in the superior court. Through the writ, 

appellant sought issuance of an order directing the Unemployment Insurance Appeals 

Board (UIAB) to vacate its decision denying him benefits for the week ending May 8, 

2010, and ordering the Employment Development Department (EDD) to pay appellant 

benefits for the week in question. We find no error in the trial court‟s decision denying 

the petition, therefore we affirm.

CONTENTIONS

Appellant contends that the UIAB and the superior court erred in determining that 

appellant earned wages for the week ending May 8, 2010, as that term is defined in 

Unemployment Insurance Code sections 1252 and 1279, and thus was not eligible to 

receive unemployment benefits for that week.1

Appellant also argues that the superior court erred in reaching the merits of his 

petition because the UIAB‟s answer was not verified and was filed late.

BACKGROUND AND PROCEDURAL HISTORY

Appellant is an attorney who left private practice in 2007 to work as a law clerk at 

the superior court. Appellant lost his job at the superior court due to the economic 

recession. He was unable to find employment either in the public or private sector.

Appellant filed a claim for unemployment benefits. His benefits commenced on 

April 4, 2010, with a weekly benefit amount of $450. Appellant believed that as long as 

his net earnings from any self-employment, less $25 or 25 percent of his wages, did not 

equal or exceed his weekly benefit amount, he would receive full or partial benefits. 

(Unemp. Ins. Code, § 1252, subd. (a)(2).)2 Appellant disclosed to EDD that he intended 

to seek work as an independent contractor while receiving benefits.

 

1 All further statutory references are to the Unemployment Insurance Code unless 

otherwise indicated.

2 Section 1252 provides, in relevant part: “(a) An individual is „unemployed‟ in any 

week in which he or she meets any of the following conditions: [¶] (1) Any week during 

which he or she performs no services and with respect to which no wages are payable to 
3

Starting in March 2010, through the week ending May 8, 2010, appellant 

expended money setting up his business as an independent contractor. Specifically, 

appellant spent “$7,691.45 for business equipment and supplies (including computer, 

printer, software, business cards, telephone and other miscellaneous equipment and 

supplies), $444.24 for the business use of his home, $743 for bar association dues and 

other professional dues, $84.50 for business entertainment, $14.43 for business gifts, 

$1,800 for professional fees he paid for services that the [appellant] declined to describe 

due to confidentiality grounds, $71.46 in telephone charges, $26.15 for miscellaneous 

sales tax, and $50 for miscellaneous other expenses.” These expenses totaled 

$10,925.23.3

When appellant certified his claim for benefits for the week ending May 8, 2010, 

he reported he had worked 22 hours that week.4 However, appellant did not report any 

wages. Instead, he took the position that his business expenses had exceeded his 

earnings.

On May 26, 2010, appellant was informed by EDD that he was not eligible for 

unemployment benefits for the week ending May 8, 2010, based on his earnings of 

$2,750 as an independent contractor during that week. On June 12, 2010, appellant 

appealed EDD‟s decision to the UIAB. On July 19, 2010, UIAB sent appellant notice of 

a hearing scheduled for July 28, 2010.

After the July 28, 2010 hearing, Administrative Law Judge (ALJ) Howard Wein 

issued a decision affirming the denial of appellant‟s unemployment benefits for the week 

 

him or her. [¶] (2) Any week of less than full-time work, if the wages payable to him or 

her with respect to the week, when reduced by twenty-five dollars ($25) or 25 percent of 

the wages payable, whichever is greater, do not equal or exceed his or her weekly benefit 

amount.”

3 Appellant admitted the computer, printer, and other items purchased will be used 

on work he will perform as an independent contractor on future work assignments, not 

just the work he performed during the week ending May 8, 2010.

4 Appellant initially erroneously reported that he worked 22 hours that week. He 

later corrected the figure to 19.2 hours.
4

ending May 8, 2010. On September 15, 2010 appellant appealed the ALJ‟s decision to 

the UIAB. UIAB affirmed the ALJ‟s decision that appellant did not qualify for 

unemployment insurance benefits for the week ending on May 8, 2010.

Appellant filed his petition for writ of mandate and writ of administrative mandate 

on April 26, 2011. The UIAB filed an unverified answer on July 13, 2011. A briefing 

schedule was set for January and February 2012, with a hearing date of March 2, 2012. 

In his reply brief, appellant objected to the trial court‟s consideration of the joint 

opposition brief filed by UIAB and EDD, which was filed five days after it was due.

On the day of the hearing, the trial court issued a tentative decision denying 

appellant‟s petition. The court was not persuaded by appellant‟s arguments that, due to 

business expenses, he had no wages for the week ending May 8, 2012, within the 

meaning of section 1252.

At the hearing, appellant reiterated his objection to any consideration of 

respondent‟s late brief unless the court made a finding of mistake, inadvertence or 

excusable neglect. The court offered to continue the matter to allow appellant more time 

to respond. Appellant declined the offer.

At the hearing appellant raised for the first time the issue that respondent‟s 

responsive pleading was not verified. Appellant stated: “The last thing is that briefly, the 

answer isn‟t verified like it‟s supposed to be. We didn‟t have the opportunity, for 

whatever reason, the service copy was late, I‟m pointing it out for the record.” After 

inquiring of counsel for UIAB whether he had a verified copy, the court stated: “I can‟t 

take default. In any event, it‟s sloppy.” The issue was not raised again during the 

hearing.

The court issued its ruling later the same day, denying appellant‟s petition. 

Judgment was entered on April 9, 2012.

On June 8, 2012, appellant filed his notice of appeal.
5

DISCUSSION

I. Standard of review

“In reviewing a decision of the [UIAB], the superior court exercises its 

independent judgment on the evidentiary record of the administrative proceedings and 

inquires whether the findings of the administrative agency are supported by the weight of 

the evidence. [Citations.]” (Lozano v. Unemployment Ins. Appeals Bd. (1982) 130 

Cal.App.3d 749, 754 (Lozano), citing Code Civ. Proc., § 1094.5, subds. (b) & (c).) In 

reviewing the trial court‟s ruling on a writ of mandate, the appellate court is ordinarily 

confined to an inquiry as to whether the findings and judgment of the trial court are 

supported by substantial, credible and competent evidence. (Lozano, at p. 754.) 

However, where the probative facts are not in dispute, the determination of the trial court 

may be reviewed as a matter of law. (Sanchez v. Unemployment Ins. Appeals Bd. (1984) 

36 Cal.3d 575, 585.)

Evidentiary and discovery rulings are reviewed for abuse of discretion. (City of 

Ripon v. Sweetin (2002) 100 Cal.App.4th 887, 900; Johnson v. Superior Court (2000) 80 

Cal.App.4th 1050, 1061.)

II. Applicable statutes

Section 1252 provides, in pertinent part:

“(a) An individual is „unemployed‟ in any week in which he or she 

meets any of the following conditions:

“(1) Any week during which he or she performs no services and with 

respect to which no wages are payable to him or her.

“(2) Any week of less than full-time work, if the wages payable to 

him or her with respect to the week, when reduced by twenty-five dollars 

($25) or 25 percent of the wages payable, whichever is greater, do not equal 

or exceed his or her weekly benefit amount.

“[¶] . . . [¶]

“(c) For the purpose of this section only „wages‟ includes any and all 

compensation for personal services whether performed as an employee or 

as an independent contractor or as a juror or as a witness, but does not 
6

include any payment received by a member of the National Guard or 

reserve component of the armed forces for inactive duty training, annual 

training, or emergency state active duty.”

Appellant also cites section 1279, which provides, in pertinent part:

“(a) Each individual eligible under this chapter who is unemployed 

in any week shall be paid with respect to that week an unemployment 

compensation benefit in an amount equal to his or her weekly benefit 

amount less the smaller of the following:

“(1) The amount of wages in excess of twenty-five dollars ($25) 

payable to him or her for services rendered during that week.

“(2) The amount of wages in excess of 25 percent of the amount of 

wages payable to him or her for services rendered during that week.

“[¶] . . . [¶]

“(c) For the purpose of this section only „wages‟ includes any and all 

compensation for personal services whether performed as an employee or 

as an independent contractor or as a juror or as a witness, but does not 

include any payments, regardless of their designation, made by a city of this 

state to an elected official thereof as an incident to public office, nor any 

payment received by a member of the National Guard or reserve component 

of the armed forces for inactive duty training, annual training, or emergency 

state active duty.”

III. Meaning of the term “wages” for self-employed persons or independent 

contractors

The dispute in this case involves the meaning of the term “wages” in the relevant 

statutes as that term is applied to those self-employed or independent contractors. 

Appellant argues that under both sections 1252 and 1279, the “wages” of one who is selfemployed or an independent contractor is the net income from the individual‟s business. 

Respondents, on the other hand, argue that the term “wages” means the gross earnings of 

a self-employed person or independent contractor in any given week. Our charge, 

therefore, is to determine the meaning of the term “wages” in these two statutes as 

applied to a person who is self-employed or an independent contractor.
7

A. The plain meaning of the statutes controls

“„As in any case involving statutory interpretation, our fundamental task here is to 

determine the Legislature‟s intent so as to effectuate the law‟s purpose.‟ [Citation.] The 

well-established rules for performing this task require us to begin by examining the 

statutory language, giving it a plain and commonsense meaning. [Citation.]” (Los 

Angeles County Metropolitan Transportation Authority v. Alameda Produce Market, LLC 

(2011) 52 Cal.4th 1100, 1106-1107.) If the statutory language is unambiguous, then its 

plain meaning controls. However, if the language supports more than one reasonable 

construction, then we may look to extrinsic aids, such as the legislative history and the 

objects to be achieved by the statute. (Id. at p. 1107.)

The term “wages” is defined in the statutes themselves. The definition quite 

broadly includes “any and all compensation for personal services.” (§§ 1252, subd. (c); 

1279, subd. (c).) The meaning of these words is plain and unambiguous. When an 

individual is seeking unemployment benefits, EDD is entitled consider any and all

compensation that an individual receives in determining whether the individual is entitled 

to receive unemployment benefits. The statutes are completely devoid of any language 

suggesting the individual may deduct his business expenses from his gross weekly 

compensation prior to reporting the income to EDD.

Under the circumstances, we find that the plain meaning of the statute must 

control, and we hold that under sections 1252 and 1279, the wages of a self-employed 

person or independent contractor include “any and all compensation” that the individual 

receives in a given week.

B. The authority cited by appellant is not controlling

1. Authority cited by appellant

Appellant points out that the meaning of the word “wages” as applied to a selfemployed person was fleshed out in an opinion of the Attorney General, 15 

Ops.Cal.Atty.Gen. 311 (1950) (the Attorney General opinion). The UIAB had inquired 

as to what constituted the “wages” of a self-employed person, to which the Attorney 

General answered:
8

“We believe therefore that „wages‟ may properly be considered to be 

the income from his business. From the gross income, it appears proper 

and equitable to deduct the expenses of the business, and to consider only 

the net income as wages. Net income is normally made up of the „wages of 

management,‟ return on capital, and pure profit. Each of these concepts is 

so nebulous, and so difficult of ascertainment in the case of the average 

business as to be practically incapable of determination. We believe 

therefore that for purposes of simplification of the administration of the act, 

the net income of the business may be considered as the „wages‟ of a selfemployed claimant. [Citation.]”

(Atty. Gen. Opn., p. 315.)

Appellant also points to In re Armen (1963) California Unemployment Insurance 

Appeals Board Precedent Benefit Decision No. P-B-201 (Armen), in which the UIAB 

adopted and applied the Attorney General opinion. The UIAB stated:

“In Benefit Decision No. 5622, and in our subsequent decisions, we 

have followed the California Attorney General‟s Opinion No. 50/76 (15 

Ops.Cal.Atty.Gen. 311) which concluded that self-employed persons and 

independent contractors are „unemployed‟ insofar as they are not 

performing „services‟ but that the net income of a self-employed person 

constituted „wages.‟ So long as the „wages‟ of a self-employed individual 

are less than his weekly benefit amount, he is „unemployed‟ (Benefit 

Decisions Nos. 5633, 5903, 6177, 6231, 6669, 6679 and 6707).”

In Worthington v. Unemployment Ins. Appeals Bd. (1976) 64 Cal.App.3d 384, 

388-389 (Worthington), the Court of Appeal referenced the Attorney General opinion, 

stating: “In 1950, the Attorney General issued his opinion that under then section 55 of 

the Unemployment Insurance Act, now section 1279 of the Code, „wages‟ which must be 

counted as earned must include the net income of the business of a self-employed 

claimant. [Citation.] Opinions of the Attorney General are entitled to great weight. 

[Citations.]” Appellant argues that through the Worthington opinion, the Court of Appeal 

thus made the cited Attorney General opinion the law of this State.

Appellant suggests that the EDD, UIAB, and superior court have ignored or 

attempted to overrule this precedent in reaching the conclusion that appellant was not 

qualified for unemployment insurance for the week ending May 8, 2010.
9

2. Respondent’s arguments

Respondent makes two arguments in an effort to persuade this court that the 

Attorney General opinion is inapplicable. First, respondent argues that the Attorney 

General opinion defines the term “wages” only as that term relates to a self-employed 

person. Respondent argues that appellant is an independent contractor, not a selfemployed person, therefore the definition found in the opinion is not at all applicable. 

We disagree. The definition found and quoted in the Attorney General opinion applies to 

both self-employed persons and independent contractors. As made clear at the beginning 

of the Attorney General opinion, it was meant to clarify “Coverage of self-employed and 

independent contractors, [and] „wages‟ of such groups.” The use of the plural in this 

descriptive paragraph suggests that the definition of “wages” set forth therein is 

applicable to both self-employed individuals and independent contractors.

Next, respondent points out that in its discussion of the term “wages,” the 

Attorney General opinion references only former section 55 of the Unemployment 

Insurance Act, now section 1279. Because this discussion did not specifically reference 

former section 9.2 of the Unemployment Insurance Act -- now section 1252 -- respondent 

argues that this definition of the term “wages” is inapplicable to the question of whether 

or not appellant was unemployed under the terms of section 1252. We also reject this 

argument. First, we note that former section 9.2 is referenced generally within the quoted 

Attorney General opinion. In addition, the language of section 1279, subdivision (c) 

describing “wages” as “any and all compensation for personal services whether 

performed as an employee or as an independent contractor,” is identical to that found in 

section 1252, subdivision (c). We must assume that the Legislature intended this 

identical language in both statutes to be given the same meaning. (People v. Wells (1996) 

12 Cal.4th 979, 986 [“the court presumes that the Legislature intended that similar 

phrases be accorded the same meaning”].)

In addition to these efforts to distinguish the subject matter of the Attorney 

General opinion, respondent implicitly suggests that we simply ignore the authorities 

cited by appellant in favor of its interpretation of sections 1252 and 1279. Without 
10

citation to authority, respondent claims in its supplemental letter brief that the relevant 

California statutory law “addresses gross wages earned within a claim week to determine 

eligibility for unemployment benefits.” Respondent explains that the law cited by 

appellant is inconvenient, claiming that the “EDD is not statutorily promulgated or 

physically constructed to address the multitude of possible deductions that a claimant 

may claim in order to reduce the wages earned during the claim week.” Respondent 

provides no authority or argument explaining its contention that we should discount the 

relevant Attorney General opinion and related case law.

3. Analysis

Attorney General opinions are entitled to great weight. Generally, an Attorney 

General opinion “is not a mere „advisory‟ opinion, but a statement which, although not 

binding on the judiciary, must be „regarded as having a quasi judicial character and [is] 

entitled to great respect,‟ and given great weight by the courts. [Citations.]” (Planned 

Parenthood Affiliates v. Van de Kamp (1986) 181 Cal.App.3d 245, 263.) Individuals 

affected by an Attorney General opinion “must regard the authoritative opinion of the 

highest law enforcement officer of the state as having a definite impact” on their 

obligations under the subject laws. (Ibid.) An opinion of the Attorney General is more 

than “a mere exercise in academic interpretation.” (Id. at p. 264.) In other words, when 

the office of the Attorney General promulgates an official opinion, it must assume that it 

will be relied upon by affected members of the public. However, Attorney General 

opinions are not binding on this court. (Watershed Enforcers v. Department of Water 

Resources (2010) 185 Cal.App.4th 969, 984, fn. 11.)

As appellant points out, the Attorney General opinion in question has also been 

applied in subsequent administrative decisions, such as Armen. This administrative 

construction of the statute is also entitled to great weight. (Whitcomb Hotel, Inc. v. 

California Employment Com. (1944) 24 Cal.2d 753, 756-757.) “Whatever the force of 

administrative construction, however, final responsibility for the interpretation of the law 

rests with the courts.” (Id. at p. 757.) Significantly, “an erroneous administrative 

construction does not govern the interpretation of a statute, even though the statute is 
11

subsequently reenacted without change. [Citations.]” (Id. at pp. 757-758.) Thus, neither 

the Attorney General opinion nor any administrative interpretation of the relevant statutes 

is binding on this court.

We disagree with appellant‟s position that in Worthington, the Attorney General 

opinion was given the force of law. In Worthington, the appellant was a young lawyer 

who had been separated from his employment and subsequently applied for and received 

unemployment benefits. However, the lawyer had commenced to practice law by 

himself, and demand was made upon him to disclose his earnings to the EDD. He did so 

under protest, taking the position that the term “wages” did not apply to income gained 

from self-employment. (Worthington, supra, 64 Cal.App.3d at pp. 386-387.) The Court 

of Appeal disagreed, finding that the income the lawyer received fit into the definition of 

“wages” set forth in section 1279 as “any and all compensation for personal services.” 

The court made a passing reference to the Attorney General opinion to emphasize that the 

Attorney General considered the language of section 1279 to include wages earned by 

self-employed individuals. The question of whether a self-employed person or 

independent contractor must report his net income, or gross income, on any given week, 

was not considered or addressed at any length. Decisions are not controlling authority for 

propositions not considered in the case. (NJD, Ltd. v. City of San Dimas (2003) 110 

Cal.App.4th 1428, 1447.)

Having considered the parties‟ respective positions and the authorities cited, we 

decline to follow the Attorney General opinion to the extent that it suggests a selfemployed person or independent contractor must only report his net income to determine 

his eligibility for unemployment benefits on any given week. The case before us 

demonstrates the impracticality of such a rule, and the difficulty imposed on the EDD in 

administering such a rule. As set forth above, the plain language of the statute requires 

that a self-employed person or independent contractor report “any and all compensation” 

for consideration in order for EDD to determine his or her status as an unemployed 

person. (§ 1252, subd. (c).)
12

IV. The superior court correctly found appellant ineligible for benefits for the week 

ending May 8, 2010

Although we have elected not to adopt the Attorney General opinion insofar as it 

defines the term “wages” of a self-employed person or independent contractor under 

section 1252 to be the net income of the individual‟s business, we understand that 

appellant may well take the position that he justifiably relied on the Attorney General 

opinion in calculating and reporting his weekly wages for the week ending May 8, 2010. 

However, for the reasons set forth below, even if the term “wages” could be understood 

to mean the net income of a self-employed person or independent contractor, we would 

find no error in the trial court‟s ruling denying appellant‟s writ.

A. General principles of accounting do not permit immediate deduction of all of 

appellant’s business expenses in determining net income

Appellant calculates his net income for the week ending May 8, 2010, by 

deducting every penny he spent setting up his business over the previous three months, 

including money spent on the purchase of a computer, printer, software, business cards, 

telephone and other miscellaneous supplies, as well as professional dues, among other 

things. We find appellant‟s method for calculating his weekly net income is 

unsupportable.

Appellant cites the Attorney General opinion as authority for the proposition that 

to determine “net income,” the proper calculation is to “deduct the expenses of the 

business.” (Atty. Gen. Opn., p. 315.) The Attorney General then gives a basic definition 

of the concept: “Net income is normally made up of the „wages of management,‟ return 

on capital, and pure profit.” (Ibid.) Nowhere in the cited opinion, or any other document 

cited by appellant, is there a breakdown of the specific expenses of the business that may 

properly be deducted in any given accounting period for the purpose of calculating the 

individual‟s net income for that accounting period. In particular, appellant cites no 

authority suggesting that all of the capital investment -- or money invested to purchase 

assets for the business -- may be deducted from the compensation of any given week in 

order to determine net income for that week.
13

In the absence of further guidance in the area of unemployment insurance, it is 

helpful to explore the commonly accepted methods for determining net income for a 

given accounting period. The concept of net income is important in the tax context, 

because tax is generally measured by the net income of a business. (Taihieyo Cement 

U.S.A., Inc. v. Franchise Tax Bd. (2012) 204 Cal.App.4th 254, 263 (Taihieyo).) 

Therefore we look to generally accepted accounting principles in the tax context to form 

an understanding of the conventional method of determining net income.5

The term “net income” means “gross income less allowable deductions.” 

(Taiheiyo, supra, 204 Cal.App.4th at p. 263.) Generally speaking, in the tax context, 

deductions are allowed for “all the ordinary and necessary expenses paid or incurred 

during the taxable year in carrying on any trade or business.” (26 U.S.C.S. § 162(a).) 

Examples of such expenses include salaries or other compensation paid out for services; 

traveling expenses; and rentals or other payments required to be made as a condition of 

carrying out the business. (26 U.S.C.S. § 162(a)(1)-(a)(3).) However, deductions for 

capital expenditures are barred. (26 U.S.C.S. § 263(a).) This includes amounts paid to 

acquire personal tangible property. (26 C.F.R. § 1.263(a)-1T(b) (2013).) Computers and 

peripheral equipment generally fall into the category of capital expenditures.6 Generally 

speaking, when reporting taxable income to the Internal Revenue Service, expenses 

incurred to acquire a computer, or related equipment that will be used in future 

accounting periods, may not be deducted from gross revenue to determine taxable net 

 

5 Respondent disputes the relevance of federal tax law in the context of state 

unemployment insurance. We do not suggest that the Internal Revenue Code and its 

associated regulations are at all binding, nor do we suggest that the complex exceptions 

and deductions are relevant. We simply use the basic accounting principles that can be

gleaned from this body of law to discuss the meaning of the term “net income,” which 

has not been further defined in the context of unemployment insurance.

6 We understand that there are some exceptions to this general rule, but as set forth 

above, we are using the area of tax law only as a general guide, and we will not consider 

whether any particular exception might apply in appellant‟s particular case when 

reporting to the Internal Revenue Service.
14

income. However, any such property may be subject to depreciation. (See 2012 

Instructions for Schedule C, Part II, Expenses, Line 13; 

<http://www.irs.gov/instructions/i1040sc/ch02.html#d0e531>.)7

In addition, expenses incurred in setting up a business are generally not 

immediately deductible in determining net income. (See Fishman v. Commissioner (7th 

Cir. 1988) 837 F.2d 309, 312 (Fishman) [“In a long line of decisions under section 162, 

the courts (including the Tax Court) have held that „pre-opening‟ expenses, that is, 

expenses incurred before the taxpayer‟s trade or business begins to operate (what we are 

calling „start-up costs‟), are not deductible. [Citations.] They yield benefits over the 

entire life of the enterprise, and therefore must be capitalized”].)8 The Fishman 

taxpayers had incurred numerous start-up costs, including professional fees, advertising, 

promotion, consulting, office, and insurance expenses. (Id. at p. 311.) The court 

explained that “income and expense must be matched temporally in order to minimize the 

inevitable misallocations of resources that a taxing system creates. (This principle is 

codified in section 263(a) of the [Internal Revenue] Code, which forbids immediate 

deduction of „capital expenditures‟ even if they are ordinary and necessary business 

expenses. [Citation.]” (Fishman, at p. 312.)

Thus, under generally accepted accounting principles, the expenses appellant 

incurred in setting up his business may not be deducted from his gross revenue to 

 

7 The Taiheiyo court presented a “brief review of general accounting terms,” 

explaining that “[o]rdinary and necessary expenses paid or incurred during the taxable 

year in carrying on a business can be deducted from gross income. [Citations.] On the 

other hand, capital assets which have „a useful life which extends substantially beyond 

the close of the taxable year‟ are subject to depreciation. [Citation.]” (Taiheiyo, supra, 

204 Cal.App.4th at p. 263.) Appellant does not argue that the concept of depreciation 

should apply in the unemployment context, therefore we will not discuss the subject 

further.

8 Although we are discussing the definition of “net income” in the context of state 

unemployment insurance law, we rely on federal case law to form a general 

understanding of the basic principles for determining net income. (See, e.g., People v. 

Hagen (1998) 19 Cal.4th 652, 661; Holmes v. McColgan (1941) 17 Cal.2d 426, 429-430.)
15

determine his net income for any single week. Appellant has cited no authority 

suggesting that a different rule applies when determining net income in the 

unemployment context. Thus, the ALJ correctly concluded that those deductions 

appellant incurred in “setting up” his business were impermissible. Because appellant 

failed to distinguish between his capital investment and any ordinary business expenses, 

the ALJ was justified in disallowing them all. Appellant‟s wages of $2,750 for the week 

ending May 8, 2010, exceeded his weekly benefit amount, therefore he was not 

“unemployed” as that term is defined in section 1252.

B. Appellant’s expenses were not incurred during the accounting period in 

question

The general accounting principle that income and expense must be matched 

temporally (see Fishman, supra, 837 F.2d at p. 312) is also problematic for appellant. In 

the context of unemployment, the accounting period for determining the recipient‟s 

eligibility for benefits is very brief. Eligibility for unemployment benefits is determined 

on a weekly basis. As the ALJ pointed out:

“[T]here is no evidence of record establishing how much of the 

$10,925.23 expenses the [appellant] incurred in setting up and operating his 

business could appropriately be deducted from [appellant‟s] earnings for 

the single week ending May 8, 2010. For example, several of [appellant‟s] 

major expenses were for equipment and supplies that [appellant] purchased 

prior to the week ending May 8, 2010, which [appellant] will be able to use 

in his business long after the week ending May 8, 2010 -- such as the 

purchase of a computer and a computer printer. Accordingly, the evidence 

of record does not support deducting any of these expenses from the $2,750 

earnings in the week ending May 8, 2010 to determine whether or not 

[appellant] was employed in that single week.”

Thus, even if certain of the expenses were deductible for the purpose of 

determining appellant‟s net income, appellant failed to present evidence that those 

expenses were incurred during the accounting period in question: specifically, the week 

ending May 8, 2010. In fact, appellant admitted that some of those expenses were 

incurred starting as early as March 2010. Appellant has failed to point out any evidence 
16

to contradict the ALJ‟s findings of fact on this issue. The judgment of the trial court is 

supported by substantial evidence and must be affirmed. (Lozano, supra, 130 Cal.App.3d 

at p. 754.)9

V. Appellant forfeited his objection for lack of a verified answer

“Appellate courts are loathe to reverse a judgment on grounds that the opposing

party did not have an opportunity to argue and the trial court did not have an opportunity

to consider. [Citation.] In our adversarial system, each party has the obligation to raise 

any issue or infirmity that might subject the ensuing judgment to attack. [Citation.]” 

(JRS Products, Inc. v. Matsushita Electric Corp. of America (2004) 115 Cal.App.4th 168, 

178 (JRS).) “„The purpose of this rule is to encourage parties to bring errors to the 

attention of the trial court, so that they may be corrected.‟ [Citation.]” (K.C. Multimedia, 

Inc. v. Bank of America Technology & Operations, Inc. (2009) 171 Cal.App.4th 939, 

949.)

Issues presented on appeal must actually be litigated in the trial court -- not simply 

mentioned in passing. “„[W]e ignore arguments, authority, and facts not presented and 

litigated in the trial court.‟” (Newton v. Clemons (2003) 110 Cal.App.4th 1, 11, fn. 

omitted, italics added.)

Appellant did not preserve for appeal his objection that respondent failed to 

provide a verified answer to his petition. Appellant mentioned the issue at the hearing, 

stating only: “The last thing is that briefly, the answer isn‟t verified like it‟s supposed to 

be. We didn‟t have the opportunity, for whatever reason, the service copy was late, I‟m 

pointing it out for the record.” Appellant cited no statutes or case law for the trial court 

to consider, and did not give respondent the opportunity to respond to any such argument. 

 

9 Appellant argues alternatively that the EDD was not permitted to disagree with 

appellant‟s calculations and deny benefits. Appellant argues that the EDD‟s duty is 

ministerial, and it is confined to determining whether appellant completed a continued 

claim form in accordance with the regulations. We reject appellant‟s position. “Under 

the administrative scheme of the Unemployment Insurance Code, the EDD has no 

underlying monetary obligation to the claimant until it determines the claimant is eligible 

for the benefits. [Citation.]” (American Federation of Labor v. Unemployment Ins. 

Appeals Bd. (1996) 13 Cal.4th 1017, 1023.)
17

Significantly, appellant did not object when the court declined to take default. Appellant 

did not seek dismissal, nor did he at any time ask that respondent‟s brief be stricken.

A trial court has broad discretion to control the proceedings before it in the 

furtherance of justice. (Code Civ. Proc., § 128.) This includes allowing amendments to 

pleadings to correct any errors or mistakes. (Code Civ. Proc., § 473, subd. (a)(1); Board 

of Trustees v. Superior Court (2007) 149 Cal.App.4th 1154, 1162-1163.)10 Generally, 

“„California courts have “a policy of great liberality in allowing amendments at any stage 

of the proceeding so as to dispose of cases upon their substantial merits where the 

authorization does not prejudice the substantial rights of others.” [Citation.] . . .‟” 

(Board of Trustees, at p. 1163.) Significantly, “„the discretion to be exercised is that of 

the trial court, not that of the reviewing court.‟” (Ibid.)

Had appellant presented a timely objection to the lack of verification of 

respondent‟s pleading, the trial court could have exercised its discretion to permit 

respondent to amend the pleading to conform to the rules. The trial court did not abuse 

its discretion in declining to strike the pleading or take default where appellant did not 

raise the issue until the end of the hearing on the writ petition. Appellant‟s strategy of 

simply “pointing . . . out . . . for the record” a pleading defect which he intended to argue 

fully on appeal subjects both the court and the parties to an unfair “bait and switch.” 

“Bait and switch on appeal not only subjects the parties to avoidable expense, but also 

wreaks havoc on a [burdened] judicial system.” (JRS, supra, 115 Cal.App.4th at p. 178.) 

Under the circumstances, we find that appellant forfeited any objection to respondent‟s 

failure to file a verified answer.

VI. The trial court did not abuse its discretion in considering respondent’s late filed 

brief

In his reply brief filed in the superior court, appellant objected to the court‟s 

consideration of respondent‟s untimely opposition brief, which he claims was filed and 

 

10 Failure to verify a pleading, where verification is required by statute, “is a mere 

defect curable by amendment.” (United Farm Workers of America v. Agricultural Labor 

Relations Bd. (1985) 37 Cal.3d 912, 915, fn. omitted.)
18

served five days late. Appellant cited Mann v. Cracchiolo (1985) 38 Cal.3d 18, 28-30 

(Mann) and Kapitanski v. Von’s Grocery Co. (1983) 146 Cal.App.3d 29, for the 

proposition that courts may only consider late filed briefs on a finding of mistake, 

inadvertence, surprise, or excusable neglect. On appeal, appellant complains that the 

superior court considered the late filed brief without making the necessary finding.

“Under the doctrine of implied findings, the reviewing court must infer, following 

a bench trial, that the trial court impliedly made every factual finding necessary to 

support its decision.” (Fladeboe v. American Isuzu Motors Inc. (2007) 150 Cal.App.4th 

42, 48.) Furthermore, in the absence of evidence to the contrary, “„[a] judgment or order 

of the lower court is presumed correct. All intendments and presumptions are indulged 

to support it on matters as to which the record is silent, and error must be affirmatively 

shown. This is not only a general principle of appellate practice but an ingredient of the 

constitutional doctrine of reversible error.‟ [Citations.]” (Denham v. Superior Court 

(1970) 2 Cal.3d 557, 564.) Evidence Code section 664 also provides a presumption that 

the trial court was aware of, and followed, the applicable law.

Taking these standards into consideration, we conclude that the trial court made an 

implied finding of mistake or excusable neglect. We review such a finding for abuse of 

discretion. (Uriarte v. United States Pipe & Foundry Co. (1996) 51 Cal.App.4th 780, 

787.) As the court pointed out, appellant‟s opening brief was also untimely. The court 

could have implicitly concluded that respondent‟s mistake stemmed from a 

miscalculation based on appellant‟s late filing. Furthermore, appellant forfeited any 

claim of prejudice arising from respondent‟s late filed brief. The court offered to 

continue the matter to give appellant more time to submit his reply and consider his 

arguments. The court emphasized: “I want you to expressly consider that option because 

I understand the rule and I understand the need for you to have a full, fair opportunity to 

reply. If you feel, for whatever reason, you haven‟t had it, I want to give you that 

opportunity.” Appellant declined the offer, stating: “I think that with my oral argument, 

I‟ve probably cured that.”
19

“Cognizant of the strong policy favoring the disposition of cases on their merits 

[citations], judges . . . frequently consider documents which have been untimely filed.” 

(Mann, supra, 38 Cal.3d at p. 17.) Here, the trial court considered both appellant‟s 

untimely filed petition, and respondent‟s untimely filed answer. Upon objection from 

appellant, the trial court suggested that appellant accept the trial court‟s offer of 

additional time to prepare. Appellant declined. Under the circumstances, we find no 

abuse of discretion in the trial court‟s decision to consider respondent‟s late filed 

pleading.

DISPOSTION

The judgment is affirmed.

CERTIFIED FOR PUBLICATION

____________________________, J.

CHAVEZ

We concur:

___________________________, Acting P. J.

ASHMANN-GERST

___________________________, J.*

FERNS

________________________________________________________________________

* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to 

article VI, section 6 of the California Constitution.