Opinion ID: 2543911
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Heading: Legislative intent and legislative history behind section 98.2(c)

Text: Initially, `[a]s in any case of statutory interpretation, our task is to determine afresh the intent of the Legislature by construing in context the language of the statute.' ( Harris v. Capital Groivth Investors XIV (1991) 52 Cal.3d 1142, 1159, 278 Cal.Rptr. 614, 805 P.2d 873.) In determining such intent, we begin with the language of the statute itself. ( Rojo v. Kliger (1990) 52 Cal.3d 65, 73, 276 Cal. Rptr. 130, 801 P.2d 373.) That is, we look first to the words the Legislature used, giving them their usual and ordinary meaning. ( City of Santa Cruz v. Municipal Court (1989) 49 Cal.3d 74, 90, 260 Cal.Rptr. 520, 776 P.2d 222.) `If there is no ambiguity in the language of the statute, then the Legislature is presumed to have meant what it said, and the plain meaning of the language governs.' ( Lennane v. Franchise Tax Bd. (1994) 9 Cal.4th 263, 268, 36 Cal.Rptr.2d 563, 885 P.2d 976.) ( People v. Superior Court (Zamudio ) (2000) 23 Cal.4th 183, 192, 96 Cal.Rptr.2d 463, 999 P.2d 686.) Section 98.2(c) does not expressly define when or under what circumstances a party is unsuccessful in the appeal from a commissioner's decision and award. RVLG urged below that the statutory language on its face has a plain and unambiguous meaning, but the Court of Appeal disagreed, observing that the very fact that courts have split on the issue and reached contradictory conclusions regarding the interpretation and meaning of section 98.2(c) (compare Triad, supra, 153 Cal.App.3d Supp. at pp. 13-15, 200 Cal.Rptr. 418 (maj. opn.), with id. at pp. 28-33, 200 Cal.Rptr. 418 (dis. opn. of Foster, P.J.)) itself suggests the relevant statutory language is ambiguous. We agree with the Court of Appeal. This is a case in which the language of the relevant statutes does not provide a ready answer. ( Lundquist v. Reusser (1994) 7 Cal.4th 1193, 1205, 31 Cal.Rptr.2d 776, 875 P.2d 1279.) Accordingly, we must determine the meaning of the phrase unsuccessful in the appeal as it appears in section 98.2(c), giving due consideration to its statutory context. (See Hodges v. Superior Court (1999) 21 Cal.4th 109, 114, 86 Cal.Rptr.2d 884, 980 P.2d 433.) To this end, we examine the legislative purpose in enacting the fee and cost-shifting provision. ( Dyna-Med, Inc. v. Fair Employment & Housing Com. (1987) 43 Cal.3d 1379, 1387, 241 Cal.Rptr. 67, 743 P.2d 1323.) We can also look to the legislative history of the enactment ( id. at pp. 1386-1387, 241 Cal.Rptr. 67, 743 P.2d 1323; Californians for Population Stabilization v. Hewlett-Packard Co., supra, 58 Cal.App.4th at p. 295, 67 Cal. Rptr.2d 621), which further demonstrates that its purpose is to discourage frivolous and nonmeritorious appeals from the commissioner's decisions. Recently, in Lolley v. Campbell (2002) 28 Cal.4th 367, 121 Cal.Rptr.2d 571, 48 P.3d 1128, we construed section 98.2(c) to determine whether a trial court may assess attorney fees against an employer who unsuccessfully appeals an administrative order to pay wages if the employee cannot afford counsel and is represented without charge by the commissioner. We observed that the legislative purpose behind section 98.2(c) is to discourag[e] unmeritorious appeals of wage claims, thereby reducing the costs and delays of prolonged disputes, by imposing the full costs of litigation on the unsuccessful appellant. ( Dawson v. Westerly Investigations, Inc. (1988) 251 Cal.Rptr. 633, 204 Cal.App.3d Supp. 20, 24 [the purpose of section 98.2, subdivision (c) is `to discourage meritless and unwarranted appeals by assessing costs and attorneys' fees against unsuccessful appellants' (italics omitted) ]; see also Nordquist v. McGraw-Hill Broadcasting Co. (1995) 32 Cal.App.4th 555, 575, 38 Cal.Rptr.2d 221 [these provisions were intended to provide `disincentives to discourage meritless and unwarranted appeals'].) Discouraging meritless appeals is consonant with the general purpose of section 98 et seq., noted above, to `provide a speedy, informal, and affordable method of resolving wage claims.' ( Cuadra v. Millan, supra, 17 Cal.4th 855, 858, 72 Cal.Rptr.2d 687, 952 P.2d 704.) ( Lolley, supra, 28 Cal.4th at p. 376, 121 Cal.Rptr.2d 571, 48 P.3d 1128; accord, California Chamber of Commerce v. Simpson (C.D.Cal.1985) 601 F.Supp. 104, 108 [This provision clearly is intended to discourage appeal from the Labor Commissioner's award....].) The Court of Appeal granted RVLG's request for judicial notice of documents bearing on the legislative history of section 98.2(c), which was first added to the Labor Code in 1980 as subdivision (b) by Senate Bill No. 1397 (1979-1980 Reg. Sess.). Among the documents the court judicially noticed were the analysis of Senate Bill No. 1397 prepared for the Assembly Committee on Labor, Employment, and Consumer Affairs, dated June 17, 1980, and the Enrolled Bill Memorandum to the Governor regarding Senate Bill No. 1397, dated July 11, 1980. [7] As the court observed, both of those documents state: The purpose of this bill is to reduce frivolous and non-meritorious appeals of the Labor Commissioner's decisions regarding payment of wages. As past cases have recognized, and the legislative history of section 98.2(c) confirms, the purpose of the fee-shifting provision is to promote the finality of the commissioner's awards. The statute discourages unmeritorious appeals to the courts by requiring that the unsuccessful appellant shoulder respondent's costs in defending the appeal. As in the Court of Appeal, Smith urges us to instead focus on important countervailing policies in the Labor Code, particularly the overriding policy requiring the prompt payment of wages. Of course the prompt payment of wages due an employee is a fundamental public policy of this state ( Gould v. Maryland Sound Industries, Inc. (1995) 31 Cal. App.4th 1137, 1147, 37 Cal.Rptr.2d 718, citing Pressler v. Donald L. Bren Co., supra, 32 Cal.3d at p. 837, 187 Cal.Rptr. 449, 654 P.2d 219), and the Legislature clearly had that important public policy in mind in enacting various provisions of the Labor Code. ( Gould v. Maryland Sound Industries, Inc., supra, at p. 1147, 37 Cal. Rptr.2d 718; see, e.g., §§ 201-203, 216.) But while various provisions of the Labor Code indisputedly have employee protection and the prompt payment of wages as their paramount purpose, we agree with the Court of Appeal that the fee-shifting provisions of section 98.2(c) are not among them. Once again, the specific purpose behind those provisions is the promotion of the finality of the commissioner's decisions and awards by discouraging frivolous appeals to the courts by either party. In any case, as the Court of Appeal recognized below, the policy promoting the prompt payment of wages was vindicated in this case. Once the commissioner determined what Smith was owed, RVLG promptly tendered payment in full in compliance with the statutory requirement, but Smith refused the payment and instead sought a trial de novo in the superior court. Thus, the situation in this case is not one in which the employer further delayed the wages due the [employee] by taking an appeal from the commissioner's award. ( Triad, supra, 153 Cal.App.3d Supp. at p. 14, 200 Cal.Rptr. 418.) To the contrary, in the factual context of this case, there is no conflict between the policy requiring the prompt payment of wages and the policy of promoting the finality of the commissioner's awards through the fee-shifting provision here in issue. Smith also renews his assertion in the Court of Appeal that the public policy underlying the statute is protection of the employee, not the employer. Based on that assertion, he urged the Court of Appeal to find that the test by which a party is found unsuccessful in the appeal under section 98.2(c) may vary depending on whether the party seeking judicial review is the employer or the employee. If the employee appeals the award to the courts, the appeal will not be deemed unsuccessful as long as he or she obtains a judgment, whether more or less than the administrative awardin theory, even a judgment of one dollar. In contrast, if the employer appeals, the appeal will be deemed unsuccessful unless the employer succeeds in overturning the award in its entirety. (See Cardenas, supra, 226 Cal.App.3d at p. 960, 277 Cal.Rptr. 247.) We disagree. As the Court of Appeal observed, the fee-shifting provision in question neither compels nor warrants the unequal treatment of employers and employees. That conclusion follows from the plain language of section 98.2(c), which makes no explicit distinction between employee and employer appeals but simply authorizes the shifting of fees and costs to the unsuccessful party filing the appeal. We recognized this in Murillo v. Fleetwood Enterprises, Inc. (1998) 17 Cal.4th 985, 997, 73 Cal.Rptr.2d 682, 953 P.2d 858, wherein we observed that [b]ecause Labor Code section 98.2 addresses the ability of both sides [employers and employees alike] to recover their costs, it comprises an express exception to [Code of Civil Procedure] section 1032 [, subdivision] (b) [which sets forth the general rule that prevailing parties shall recover their costs]. Moreover, as the Court of Appeal further observed, through recent amendments to section 98.2, the Legislature imposed certain bonding requirements that are applicable only to employer appeals. (§ 98.2, subd. (b); see Stats.2000, ch. 876[,] § 2.) Yet in the very next paragraph of the statute, which contains the cost-shifting provisions at issue here, the Legislature made no distinction between employers and employees. That omission suggests a legislative intent to apply this cost-shifting provision evenhandedly, to employers and employees alike. Evenhanded application is consistent with the statute's policy. (Cf. Bank of San Pedro v. Superior Court (1992) 3 Cal.4th 797, 804-805, 12 Cal. Rptr.2d 696, 838 P.2d 218 [`Not to require an undertaking in this case would further thwart the policy of [Code of Civil Procedure] section 998 by creating an anomalous disparity between plaintiffs and defendants .... An evenhanded application of the requirement for an undertaking on appeal best effectuates the policy of encouraging settlements under section 998.']; see also [ Triad], supra, 153 Cal.App.3d Supp. at p. 29, 200 Cal.Rptr. 418 (dis. opn. of Foster, P.J.) [`Nothing in the statute or the legislative history suggests that the Legislature in enacting section 98.2, subdivision [ (c) ], intended that it operate unilaterally against employers or that it was designed to serve the purpose of preventing the withholding of just wages due a discharged or terminated employee. To the contrary, the apparent purpose of it is to give force and effect to the Labor Commissioner's award by discouraging either party from appealing from the award on other than meritorious grounds.' (Fn.omitted.) ].) In sum, the purpose and intent behind section 98.2(c) is to discourage frivolous and unmeritorious appeals from the commissioner's awards, regardless of whether they are taken by employers or employees. With that legislative purpose in mind, we next briefly examine two statutory feeshifting schemes, which RVLG urged the Court of Appeal to find analogous to section 98.2(c), to see if those statutes can shed any light on our inquiry into the manner in which the Legislature intended section 98.2(c) to operate.