Opinion ID: 1156663
Heading Depth: 5
Heading Rank: 1

Heading: California cases

Text: Other than Jersey Maid, supra, 13 Cal.2d 620, we have found no California case addressing directly the authority of nonconstitutional agencies ( ante, p. 355) to make restitutive money awards. [7] There is, however, at least one statute that authorizes similar administrative relief. The Fair Employment and Housing Commission (FEHC) is authorized to order reinstatement of employment with ... backpay under Government Code section 12970, subdivision (a). [8] Additionally, another provision in the same act formerly allowed the FEHC to award actual ... damages for housing discrimination. (Former Gov. Code, § 12987, subd. (2), Stats. 1980, ch. 992, § 4.) Neither statute has faced a challenge based on the agency's constitutional authority to order such remedies, although our courts have affirmed administrative decisions imposing such damages. (See Stearns v. Fair Employment Practice Com. (1971) 6 Cal.3d 205, 211, 214 [98 Cal. Rptr. 467, 490 P.2d 1155] [$250 damage award]; Hess v. Fair Employment & Housing Com. (1982) 138 Cal. App.3d 232, 234 [187 Cal. Rptr. 712, 33 A.L.R.4th 958] [$1,000 damage awards].) Nor do our recent cases dealing with administrative authority to award compensatory or punitive damages shed significant light on the constitutional issue presented here. In Youst v. Longo (1987) 43 Cal.3d 64 [233 Cal. Rptr. 294, 729 P.2d 728], and Dyna-Med, Inc. v. Fair Employment & Housing Com. (1987) 43 Cal.3d 1379 [241 Cal. Rptr. 67, 743 P.2d 1323], we held the relevant statutes did not authorize awards of either compensatory or punitive damages by the California Horseracing Board, or punitive damages by the FEHC. Accordingly, we did not reach constitutional claims. [9] Some further understanding may be gleaned from the cases dealing with the remedial authority of administrative licensing agencies. It is well established, for example, that administrative agencies with licensing power also have the authority to revoke or suspend licenses. (See, e.g., Kolnick v. Board of Medical Quality Assurance (1980) 101 Cal. App.3d 80, 86-87.) We expressly conceded in Suckow v. Alderson, supra, 182 Cal. 247, a medical licensing case, that exercise of power to revoke a license is judicial in its nature, and quasi-judicial. ( Id. at pp. 249-250.) Nevertheless, we concluded that such power did not violate article VI, section 1, because administrative boards are not courts in the strict sense; they are not exercising `the judicial power of the state' as that phrase is used in the constitution conferring judicial power upon courts, and ... statutes creating such boards and conferring upon them such powers are constitutional. ( Id. at p. 250.) [10] In subsequent professional license revocation cases we rejected other judicial power challenges to administrative action. In so doing, we implied that so long as appropriate judicial review was available, the challenged administrative determination was not subject to attack on the ground of unlawful delegation of judicial power. (See, e.g., Drummey, supra, 13 Cal.2d 75, 84-85 [It is the essence of judicial action that finality is given to findings based on conflicting evidence. If the statute be so construed it would violate the state Constitution.... [¶] In view of these principles, it necessarily follows that the court ... must exercise an independent judgment on the facts.]; Laisne, supra, 19 Cal.2d 831, 840 [[A vested property right] cannot be finally destroyed by a nonjudicial body if the action of that body is questioned in a court of law in a mandate proceeding. [¶] [I]f finality were given to the action of an administrative agency, such would be an unconstitutional exercise of judicial power.]; see also Bixby, supra, 4 Cal.3d 130, 142-143.) These decisions recognized  as a limiting condition on administrative power  what Professor Davis has later termed the principle of check: In the organic arrangements that we have been making in recent decades in the establishment and control of administrative agencies, the principle that has guided us is the principle of check, not the principle of separation of powers. We have had little or no concern for avoiding a mixture of three or more kinds of power in the same agency; we have had much more concern for avoiding or minimizing unchecked power. The very identifying badge of the modern administrative agency has been the combination of judicial power (adjudication) with legislative power (rule making).... (1 Davis, Administrative Law Treatise (1958) § 1.09, pp. 68-69, italics added.) We have never held, however, that the mere availability of judicial review insulates all forms of administrative adjudication from constitutional challenge under the judicial powers clause. And, we note, none of our prior cases involved an administrative restitutive award. The question arises whether, even assuming appropriate judicial review is assured, an administrative agency may constitutionally adjudicate restitutive money claims. Once again, we derive some illumination from our licensing cases. Some commentators suggest that a licensing board's authority to revoke or suspend licenses stems from the inherent strength of the police power itself. Professor Brown, for example, reasons that the administrative board's authority to grant a license necessarily implies an authority to regulate license holders, and to take appropriate disciplinary action against those who violate licensing standards. (Brown, Administrative Commissions and Judicial Power (1935) 19 Minn.L.Rev. 261, 287-288; see also Jaffe, Judicial Control of Administrative Action (1966) p. 114.) But if an administrative board's exercise of judicial-like power is justified as a reasonable means of effectuating its regulatory goal, it is difficult to explain why a price control board may not order restitution in order to effectuate its own regulatory goal  unless an order for monetary recovery is itself of such a character that it is purely judicial, and may be imposed only by a court. The cases, however, have not suggested that an order for monetary recovery per se is of such character that it may be made only by a court. In practice, our administrative agencies commonly order money reparations, as when restitution is imposed as a probationary term on a licensee (e.g., Russell v. Miller (1943) 21 Cal.2d 817, 818 [136 P.2d 318] [electrical contractor's license suspended until defendant makes restitution to his client satisfactory to the Registrar of Contractors]; American Funeral Concepts v. Board of Funeral Directors & Embalmers (1982) 136 Cal. App.3d 303, 308 [186 Cal. Rptr. 196] [license conditionally revoked; licensee subject to 300-day suspension on condition it make restitution]), and we have referred to the exercise of such power with apparent approval. ( Youst v. Longo, supra, 43 Cal.3d 64, 82, fn. 15 [We do not mean to imply that the Board is without authority to require compensatory relief as a condition for reinstatement of licenses.].) [11] One recent Court of Appeal decision discussed the implications of administrative power to make restitutive money awards. McKee v. Bell-Carter Olive Co. (1986) 186 Cal. App.3d 1230 [231 Cal. Rptr. 304], involved an administrative body that regulates the conduct of its licensees  food processors  in relation to the processors' suppliers, food growers. [12] Among other things, the administrative board has authority to entertain a grower's complaint that a processor has failed to pay for products under a contract, and to suspend a processor's license until restitution is paid to the grower. [13] Addressing the grower's assertion that the administrative scheme failed to provide a remedy for recovery of his claimed damages (restitutive, compensatory and punitive), the McKee court stated: It is certainly true ... that despite this broad statutory framework, the Director has no authority to award damages directly.... [T]his apparently stems from the decision of the California Supreme Court in Jersey Maid. ... Nevertheless, [Food and Agriculture Code] sections 55749 and 55851 make clear that once the Director has determined a [grower] is entitled to payment from a licensed processor, the Director may indirectly compel compliance with such an order by conditioning suspension of the processor's license upon payment of the money due the [grower]. Setting aside for the moment plaintiff's claims for damages in excess of the contract price, resort to the statutory remedy would have sufficed to make plaintiff whole, i.e., to attain for him the properly computed contract price for his olives. Thus while the statutory procedure is facially punitive, its effect is to provide an administrative remedy clearly relevant to plaintiff's claim. Notwithstanding the Director's inability to directly order the payment of damages, the Director's power to conditionally suspend a processor's license until payment of reparations is made is the practical equivalent of such power and, in fact, the most power which can constitutionally be afforded the Director in light of the decision in Jersey Maid .... The detailed procedure outlined by the statutes makes clear the Director's power is more than mere investigatory power without any procedural mechanism by which the person aggrieved can obtain relief.... (186 Cal. App.3d at p. 1238, italics added.) The court concluded that the statutes provided an administrative remedy for a grower who contends that ... a processor ... failed to compensate him in accordance with the terms of their contract. ( Id. at p. 1239.) [14] Plaintiff here appears to concede the exercise of this type of restitutive/remedial power by a licensing board does not violate article VI, section 1 of our Constitution. She does not attempt to explain, however, why the same remedial power offends the Constitution in the present context merely because it is exercised by a regulatory board that does not also exercise a licensing function. [15] As a practical matter, the administrative agency performs the same function in both instances: determining restitutive compensation, and ordering payment in furtherance of an underlying regulatory purpose. In conclusion, although we acknowledge the constitutional importance of ensuring judicial review of administrative determinations, our prior cases do not stand for the proposition that an administrative agency may exercise all manner of judicial-like power on the simple condition that judicial review of the administrative decision remains available. On the other hand, our prior licensing cases have accepted without constitutional debate the authority of licensing agencies to impose a restitutive award as a probationary term on a licensee, and these cases do not foreclose the possibility that, under appropriate circumstances, an agency without licensing power should likewise be allowed to make such restitutive awards. For additional guidance on this latter point, we turn to decisions of our sister states.