Opinion ID: 2588288
Heading Depth: 2
Heading Rank: 3

Heading: 1992 and 1993 Amendments to the FEHA

Text: After our Walnut Creek Manor decision, the Legislature amended the FEHA in several significant respects. (See Stats. 1992, ch. 182, § 19, pp. 924-925; Stats. 1993, ch. 1277, §§ 9, 10, pp. 7518-7522.) The Legislature sought to make the FEHA `substantially equivalent]' (Cal. Fair Employment and Housing Com., Enrolled Bill Rep. on Sen. Bill No. 1234 (1991-1992 Reg. Sess.) July 2, 1992, p. 2) to the federal Fair Housing Act and its amendments (42 U.S.C. § 3601 et seq.), and to make the DFEH eligible for certification from the United States Department of Housing and Urban Development (HUD) in order to enforce rights under the federal fair housing scheme. (See Broadmoor San Clemente Homeowners Assn. v. Nelson (1994) 25 Cal.App.4th 1, 7-8, 30 Cal.Rptr.2d 316 [discussion of Assem. Bill No. 2244 (1993-1994 Reg. Sess.), enacted as Stats.1993, ch. 1277, §§ 9, 10, p. 7518 et seq.]; see generally 24 C.F.R. § 115.200 et seq. (2001) [federal criteria for certifying substantially equivalent state agencies].) As relevant here, the federal Fair Housing Act permits HUD administrative law judges to award damages for emotional distress in administrative hearings. (See 42 U.S.C. § 3612(b), (g)(3); 24 C.F.R. § 180.670(b)(3)(i).) In 1992, the Legislature amended the FEHA by adding section 12989 (Stats. 1992, ch. 182, § 19, pp. 924-925), which provides the alternative of a civil action to the Commission's administrative proceeding. Subdivision (a) of section 12989 states that [i]f an accusation is issued under Section 12981, a complainant, a respondent, or an aggrieved person on whose behalf a complaint is filed may elect, in lieu of an administrative proceeding under Section 12981, to have the claims asserted in the charge adjudicated in a civil action under this part. A party must make an election within 20 days after the service of the accusation, and not later than 20 days after service of the complaint to the respondent. (§ 12989, subd. (b).) The Legislature also increased the amount of civil penalties available (§ 12987, subd. (a)(3)), and set apart the Commission's authority to award actual damages in a separate subdivision. (Id., subd. (a)(4).) Affirming the intent to make the FEHA substantially equivalent to its federal counterpart, the Legislature added that [n]othing in this part shall be construed to afford to the classes protected under this part, fewer rights or remedies than the federal Fair Housing Amendments Act of 1988 (P.L. 100-430) and its implementing regulations (24 C.F.R. 100.1 et seq.), or state law relating to fair employment and housing as it existed prior to the effective date of this section. (§ 12955.6.) Although Senate Bill No. 1234 acknowledged our holding in Walnut Creek Manor, the 1992 legislation did not address the decision, nor attempt[ ] to distinguish its remedy provision from that which was struck down in Walnut Creek. (Cal. Fair Employment and Housing Com., Enrolled Bill Rep. on Sen. Bill No. 1234, supra p. 2.) The Commission's enrolled report acknowledged that the part of [Senate Bill No.] 1234 which authorizes the [Commission] to award unlimited actual damages could face constitutional challenge. (Ibid.) However, the report also surmised that the judicial option provision (§ 12989), allowing either party to remove the case to court, may protect it from a successful Constitutional challenge.... [A] respondent against whom compensatory damages ... are assessed by the Commission would have a weaker constitutional argument, since it had the choice to move the case to the court system. (Cal. Fair Employment and Housing Com., Enrolled Bill Rep. on Sen. Bill No. 1234, supra, July 2, 1992, pp. 2-3.) The 1993 legislation (Stats.1993, ch. 1277, §§ 9, 10, p. 7518 et seq.) also recognized the effect of Walnut Creek Manor's compensatory damages limitation. At HUD's suggestion, in light of Walnut Creek Manor the Legislature amended the FEHA to require that the DFEH advise that a housing discrimination complainant may only be able to recover damages for emotional distress or other intangible injuries through a civil action ....(§§ 12980, subd.(d), 12981, subd. (g).) Although HUD noted that limiting these damages to a civil action was inconsistent with the federal Fair Housing Act and its amendments (42 U.S.C. § 3601 et seq.), it concluded that giving notice of the limitation to complainants would alleviate this concern. [S]o long as complainants are made aware of this and can, therefore, make informed decisions as to whether to elect a judicial proceeding, this inconsistency is not problematic. (HUD Asst. Gen. Counsel Harry L. Carey, mem. to Asst. Sect. Gordon H. Mansfield, U.S. Off. of Fair Housing and Equal Opportunity, Aug. 27, 1992, p. 5.) The Commission emphasizes that the Legislature subsequently enacted the judicial option provision (§ 12989), to remedy the defect in FEHA identified in Walnut Creek Manor. We must decide first whether Walnut Creek Manor's holdingemotional distress damages for housing discrimination are unavailable in an administrative proceedingis controlling, or otherwise distinguishable. Next, we determine whether the 1992 and 1993 amendments eliminated the concerns identified in Walnut Creek Manor. As the parties observe, Walnut Creek Manor did not consider whether either party's ability to opt out of the FEHA administrative proceeding would make a difference in the constitutional analysis. The FEHA's judicial option provision (§ 12989) did not exist at that time. In a footnote we observed, but did not discuss the significance of, a judicial option under the federal 1988 Fair Housing Amendments Act, so that any party who desires a jury trial may remove the case to federal court and there demand a jury. ( Walnut Creek Manor, supra, 54 Cal.3d at p. 262, fn. 11, 284 Cal.Rptr. 718, 814 P.2d 704, citing 42 U.S.C. § 3612(a), (o).) Because the issue of the judicial option was not squarely before us, we conclude that Walnut Creek Manor is not dispositive on whether the 1992 and 1993 amendments, in particular section 12989, address separation of powers concerns over the Commission's authority to award emotional distress damages. Like the Commission and its amici curiae, we find persuasive the high court's decision in CFTC, supra, 478 U.S. 833, 106 S.Ct. 3245, 92 L.Ed.2d 675, which predates both Walnut Creek Manor and McHugh. [4] Using CFTC's rationale, the Commission and its amici curiae maintain that with the available alternative of a civil action and the requirement that all parties must consent to the Commission's jurisdiction (§ 12989, subd. (a)), separation of powers concerns are diminished. (CFTC, supra, 478 U.S. at p. 855, 106 S.Ct. 3245.)