Court Opinion

ID: 1042443
Source: CourtListenerOpinion
Date Created: 2013-09-27 20:24:55.788653+00
Date Added: 2024-06-11T15:27:04.864465
License: Public Domain

Filed 9/10/13; pub. order 9/27/13 (see end of opn.)

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                                    THIRD APPELLATE DISTRICT
                                                 (San Joaquin)
                                                      ----

AMERICAN CORPORATE SECURITY, INC.,                                      C070504

                  Plaintiff and Appellant,                             (Super. Ct. No.
                                                                 39201100270100CUWMSTK)
         v.

JULIE SU, AS LABOR COMMISSIONER, ETC.,

                  Defendant and Respondent.

         Paul Thomas filed a complaint with the Labor Commissioner, claiming that he
was fired from his job at plaintiff American Corporate Security, Inc. (ACS) in retaliation
for asserting his rights under the Labor Code. Defendant Labor Commissioner
investigated the complaint and found reasonable cause to believe there was a violation.
The Labor Commissioner, however, did not issue her determination until over three years
after Thomas filed his complaint. Labor Code section 98.7 requires the Commissioner to
give notice of the determination “not later than 60 days after the filing of the complaint.”

                                                       1
(Lab. Code,1 § 98.7, subd. (e).) ACS petitioned for a writ of mandate to order the Labor
Commissioner to retract the determination and order for remedial action.
        ACS appeals from an order of dismissal after the demurrer of defendant Labor
Commissioner was sustained.2 ACS contends it was an abuse of discretion to sustain the
demurrer because it has no adequate remedy at law to challenge the Labor
Commissioner‟s procedural unfairness, including the failure to complete the investigation
within 60 days as required by statute. As we will explain, ACS has an adequate legal
remedy because it can raise these points in defense to the Labor Commissioner‟s action to
enforce her order. Accordingly, we shall affirm.
                  FACTUAL AND PROCEDURAL BACKGROUND
        Thomas worked as a security guard at ACS from January 2007 until November
2007. On May 15, 2008, Thomas filed a complaint with the Labor Commissioner,
alleging that he was terminated in retaliation for asserting his rights under the Labor
Code. Thomas had complained about not receiving his paychecks and said he would go
to “the Labor Board.”
        Over three years later, on July 9, 2011, the Labor Commissioner issued a
determination that “there is reasonable cause to believe [ACS] violated the Labor Code.”
The Labor Commissioner directed ACS to cease and desist retaliation, offer Thomas
reinstatement to his position or a substantially equivalent position, and pay Thomas back
wages plus interest.
        ACS immediately appealed the decision, which the Acting Director of the
Department of Industrial Relations upheld.

1   Further undesignated statutory references are to the Labor Code.
2 An appeal lies from a dismissal order after a demurrer is sustained without leave to
amend. (Code Civ. Proc., §§ 581d, 904.1, subd. (a); Serra Canyon Co. v. California
Coastal Com. (2004) 120 Cal.App.4th 663, 667.)

                                             2
       On September 19, 2011, the Labor Commissioner sent ACS a demand letter. The
demand was for $86,094.56 in back wages for Thomas for the period November 21, 2007
through September 21, 2011, with back wages continuing to accrue until an unconditional
offer of reinstatement was made. The demand included 10 percent interest on lost wages-
-$12,929.52 as of September 21, 2011--and an unconditional offer to Thomas of
reinstatement with restoration of all lost benefits. ACS was given 10 days to comply with
the demand.
       On September 27, 2011, ACS petitioned for a writ of mandate to command the
Labor Commissioner to retract its determination and orders to take remedial action, and
to dismiss the complaint filed by Thomas. ACS alleged the Labor Commissioner failed
to give ACS notice of her determination within 60 days of Thomas‟s complaint, as
required by statute. ACS suffered actual prejudice from the delay because its primary
exculpatory witness had died in January 2009 and other witnesses moved away. The
Labor Commissioner had relied upon the failure of ACS to produce this primary witness
in her determination that there was a Labor Code violation
       The writ petition alleged that the determination was not supported by the evidence.
It alleged that Thomas was not terminated from employment; he resigned. He was not
qualified for his position because he engaged in threatening and belligerent behavior,
used profane language, and refused to leave the premises. ACS believed that reinstating
Thomas would conflict with its duty under sections 6400 and 6403 to provide a safe
workplace.
       The writ petition also alleged that ACS had no “plain, speedy, and adequate legal
remedy” to challenge the Labor Commissioner‟s determination. ACS had filed an appeal
with the Director of the Department of Industrial Relations, which was denied, and no
additional right to appeal “is provided.”
       On November 7, 2011, while the writ petition was pending, the Labor
Commissioner filed a complaint in Sacramento County Superior Court against ACS for

                                            3
back pay and injunctive relief. The complaint alleged ACS violated section 98.6 by
retaliating against Thomas--terminating his employment--after he complained about
receiving late paychecks and claimed he would go to “the Labor Board.
       ACS answered this complaint. It asserted 35 affirmative defenses. These
affirmative defenses included that the complaint was barred by various statutes of
limitations and laches, the complaint violated due process, and the Labor Commissioner
violated her statutory obligations under section 98.7.
       The Labor Commissioner demurred to the writ petition, alleging that ACS had an
adequate legal remedy in the pending Sacramento action. She argued the 60-day deadline
in section 98.7 for giving notice of the determination was directory, not mandatory.
       At the hearing on the demurrer, the Labor Commissioner argued her order for back
pay and reinstatement was not self-executing; she had to bring an action to enforce it.
She argued ACS could raise the issue of delay and the loss of its witness in the
Sacramento suit to enforce the order. Counsel represented that every such case she had
litigated had been a trial de novo.
       The trial court found the Labor Commissioner was bound by these representations
as to the nature of the trial in the Sacramento action. Based on these representations, the
court ordered the writ petition dismissed.
                                       DISCUSSION
                                               I
                                      Writ of Mandate
       “A writ of mandate may be issued by any court to any inferior tribunal,
corporation, board, or person, to compel the performance of an act which the law
specially enjoins, as a duty resulting from an office, trust, or station, or to compel the
admission of a party to the use and enjoyment of a right or office to which the party is
entitled, and from which the party is unlawfully precluded by that inferior tribunal,
corporation, board, or person.” (Code Civ. Proc., § 1085, subd. (a).) To obtain writ

                                              4
relief, “the petitioner must show there is no other plain, speedy, and adequate remedy; the
respondent has a clear, present, and ministerial duty to act in a particular way; and the
petitioner has a clear, present and beneficial right to performance of that duty.” (County
of San Diego v. State (2008) 164 Cal.App.4th 580, 593.)
       “The writ must be issued in all cases where there is not a plain, speedy, and
adequate remedy, in the ordinary course of law.” (Code Civ. Proc., § 1086.) Usually, a
writ of mandate is available only if there is no plain, speedy, and adequate remedy in the
ordinary course of law. (Code Civ. Proc., § 1086; San Joaquin County Dept. of Child
Support Services v. Winn (2008) 163 Cal.App.4th 296, 301.) “„It is a general rule that the
extraordinary remedy of mandate is not available when other remedies at law are
adequate.‟ [Citation.]” (Agosto v. Board of Trustees of Grossmont-Cuyamaca
Community College Dist. (2010) 189 Cal.App.4th 330, 336.)
       “An action at law or in equity, in a competent trial court, is the ordinary remedy to
protect any right. When that action is available, it is presumed to be adequate and
normally precludes a resort to mandamus. [Citations.]” (8 Witkin, Cal. Procedure (5th
ed. 2008) Extraordinary Writs, § 122, p. 1013.)
                                             II
                                  Labor Code Provisions
       Section 98.6 prohibits retaliation, by discharge or other discrimination, against any
employee for exercising rights protected by the Labor Code. (§ 98.6.) Section 98.7
provides for filing a complaint with the Labor Commissioner if one believes such
discharge or discrimination has occurred.
       The process begins with the complainant (employee) filing a complaint within six
months of the alleged violation. (§ 98.7, subd. (a).) A discrimination complaint
investigator then investigates. (Ibid.) The complaint is assigned for investigation as a
priority matter. “Discrimination complaints assigned for investigation shall have a higher
priority than any other work assigned to those investigators.” (Stats. 1985, ch. 1480, § 8,

                                              5
p. 5429.) The investigation may include interviews with witnesses and a review of
documents. The investigator prepares a report, which is reviewed by the Labor
Commissioner to determine whether a violation occurred. (§ 98.7, subd. (b).) The Labor
Commissioner may hold a hearing if deemed necessary to fully establish the facts. (Ibid.)
          If the Labor Commissioner determines there is a violation, she shall notify both
the complainant and respondent (employer) of her determination “not later than 60 days
after filing of the complaint.” (§ 98.7, subd. (e).) Either party may appeal the
determination to the Director of Industrial Relations within 10 days. “The director may
consider any issue relating to the initial determination and may modify, affirm, or reverse
the Labor Commissioner‟s determination.” (Ibid.) The determination on appeal shall
then be the determination of the Labor Commissioner. (Ibid.)
          Where a violation is found, the Labor Commissioner must order the respondent to
cease and desist from the violation and take remedial action, including, where
appropriate, reinstatement and reimbursement of lost wages with interest. (§ 98.7, subd.
(c).) If, within 10 working days of the notice of Labor Commissioner‟s determination,
the respondent does not comply with this order, “the Labor Commissioner shall bring an
action promptly in an appropriate court against the respondent.” (Ibid.) “In any action,
the court may permit the claimant to intervene as a party plaintiff and shall have
jurisdiction, for cause shown, to restrain the violation and to order all appropriate relief.”
(Ibid.)
                                               III
                                ACS’s Contentions and Analysis
          ACS contends the trial court abused its discretion in dismissing the petition for a
writ of mandate because it has no other remedy to challenge the Labor Commissioner‟s
determination and order. ACS contends the pending Sacramento action to enforce the
order does not provide an adequate remedy because it does not provide for a “trial de
novo.” ACS bases this contention on the language of subdivision (c) of section 98.7

                                                6
which provides that the court has “jurisdiction, for cause shown, to restrain the violation
and to order all appropriate relief.” (Italics added.) ACS argues the language “for cause
shown” is clear and unambiguous and does not encompass a trial de novo.3 ACS
contends that when the Legislature intended to provide for a trial de novo, it expressly
said so. For example, section 98.2 provides for an appeal of an order, decision, or award
by filing an appeal to the superior court, “where the appeal shall be heard de novo.”
(§ 98.2, subd. (a).)
       We recognize the general rule of statutory interpretation about the use of same or
different words in a statute. „“Where the same word or phrase might have been used in
the same connection in different portions of a statute but a different word or phrase
having different meaning is used instead, the construction employing that different
meaning is to be favored.”‟ [Citation.]” (Alameda County Flood Control & Water
Conservation Dist. v. Department of Water Resources (2013) 213 Cal.App.4th 1163,
1186.) That rule is inapplicable here because section 98.2 and section 98.7 provide for
very different procedures. The words “de novo” and “for cause shown” are not used in
the same context or “in the same connection.”
       Section 98 gives the Labor Commissioner the authority to investigate wage
complaints and provides for administrative relief, known as a “Berman” hearing
procedure after its legislative sponsor. (Cuadra v. Millan (1998) 17 Cal.4th 855, 858
(Cuadra), disapproved on other grounds in Samuels v. Mix (1999) 22 Cal.4th 1, 16, fn.
4.). “In brief, in a Berman proceeding the commissioner may hold a hearing on the wage
claim; the pleadings are limited to a complaint and an answer; the answer may set forth

3 ACS does not, however, explain what the clear and unambiguous meaning of “for
cause shown” is. “An appellate court is not required to examine undeveloped claims, nor
to make arguments for parties.” (Paterno v. State of California (1999) 74 Cal.App.4th
68, 106.)

                                             7
the evidence that the defendant intends to rely on, and there is no discovery process; if
the defendant fails to appear or answer no default is taken and the commissioner proceeds
to decide the claim, but may grant a new hearing on request. (§ 98.) The commissioner
must decide the claim within 15 days after the hearing. (§ 98.1.) Within 10 days after
notice of the decision any party may appeal to the appropriate court, where the claim will
be heard de novo; if no appeal is taken, the commissioner's decision will be deemed a
judgment, final immediately and enforceable as a judgment in a civil action. (§ 98.2.)”
(Cuadra, supra, 17 Cal.4th at pp. 858-859.) Under this procedure, there is a hearing,
albeit an informal one, and the Labor Commissioner‟s order, decision, or award shall “be
deemed the final order” unless there is an appeal. (§ 98.2, subd. (d).) A party may seek
review of the order, decision or award “by filing an appeal to the superior court, where
the appeal shall be heard de novo.” (§ 98.2, subd. (a).) Since an appeal may provide
only limited review, it was necessary for the Legislature to indicate the review was de
novo.
        Under section 98.7, by contrast, there is usually no hearing and the Labor
Commissioner‟s order does not become “final” without further action by the Labor
Commissioner.4 Unless the employer voluntarily complies with the order, the Labor
Commissioner must “bring an action promptly in an appropriate court against the
respondent.” (§ 98.7, subd. (c).) The employer does not “appeal” the order to a court, as
under section 98.2. Instead, the burden is on the Labor Commissioner to enforce its order
by bringing an action.
        The question, then, is whether ACS has the opportunity to raise defenses,
including procedural defenses, in this action. Nothing in section 98.7 prevents an

4 The Labor Commissioner‟s Summary of Procedures for retaliation and discrimination
complaints indicates that only rarely will a hearing be held before the determination is
made.

                                             8
employer from raising procedural defenses in the Labor Commissioner‟s action. Since
the statutory scheme requires that the Labor Commissioner file an action to enforce her
determination, rather than putting the burden on the aggrieved party to appeal or seek
review, there is no need to specify that there is de novo review. As we explain, an action
by its very nature is a de novo procedure. We conclude ACS has the right to raise any
defense that a defendant may raise in an action.
        “An action is an ordinary proceeding in a court of justice by which one party
prosecutes another for the declaration, enforcement, or protection of a right, the redress or
prevention of a wrong, or the punishment of a public offense.” (Code Civ. Proc., § 22.)
“[A]n action not only encompasses the complaint „but refers to the entire judicial
proceeding at least through judgment and is generally considered synonymous with
“suit”.‟ [Citations.]” (Salawy v. Ocean Towers Housing Corp. (2004) 121 Cal.App.4th
664, 672.) “An „action‟ thus includes all proceedings, at least to the time of judgment,
which are required to perfect the rights. The defenses raised in the answer to the
complaint are a real part of any action.” (Palmer v. Agee (1978) 87 Cal.App.3d 377,
387.)
        “Where the Legislature creates a right of action and makes no special provisions
for its enforcement, other than by directing that a civil action may be brought for that
purpose, such action may be commenced and prosecuted pursuant to the provisions of the
general law regulating proceedings in civil cases, and parties to such actions may take
any and all steps authorized thereby.” (Burson v. Cowles (1864) 25 Cal. 535, 538.)
        Here, in accordance with general law, the Labor Commissioner filed a complaint
and ACS filed an answer, asserting numerous defenses. (See Code Civ. Proc., §§ 420,
422.10.) ACS offers no coherent reason why its defenses cannot be litigated in the Labor
Commissioner‟s action.
        ACS contends it has been deprived of due process because the Labor
Commissioner has ordered it to pay Thomas money without a hearing. “Due process

                                             9
principles require reasonable notice and opportunity to be heard before governmental
deprivation of a significant property interest. [Citations.]” (Horn v. County of Ventura
(1979) 24 Cal.3d 605, 612.) Because money is a property interest, the Labor
Commissioner‟s determination implicates a property interest. (Corrales v. Bradstreet
(2007) 153 Cal.App.4th 33, 60.) The Labor Commissioner agrees that depriving ACS of
its money without a hearing and other protections would violate due process, but
contends there is no due process violation because the pending superior court action
provides ACS with full due process protection. We agree; indeed, due process requires
that we interpret section 98.7 to permit the employer to raise all applicable defenses in the
superior court action to enforce the Labor Commissioner‟s order. “An established rule of
statutory construction requires us to construe statutes to avoid „constitutional
infirmit[ies].‟ [Citations.]” (Myers v. Philip Morris Companies, Inc. (2002) 28 Cal.4th
828, 846–847.) “[C]ourts should, if reasonably possible, construe a statute „in a manner
that avoids any doubt about its [constitutional] validity.‟” (Kleffman v. Vonage Holdings
Corp. (2010) 49 Cal.4th 334, 346, original italics.)
       ACS contends the trial court erred in giving deference to the Labor
Commissioner‟s interpretation of the language of section 98.7 because such interpretation
is clearly erroneous. (See Southern Cal. Edison Co. v. Public Utilities Com. (2000) 85
Cal.App.4th 1086, 1105, [“an agency‟s interpretation of a regulation or statute does not
control if an alternative reading is compelled by the plain language of the provision”].
Because we find the Labor Commissioner‟s interpretation of section 98.7 correct, we
reject this contention.
       ACS contends the trial court abused its discretion in dismissing the writ petition
because the petition set forth the essential elements for writ relief. ACS will be able to
raise these defenses in defense to the Labor Commissioner‟s action.
       Finally, ACS requested leave to amend its petition if this court finds the demurrer
was properly sustained. “„When a demurrer . . . is sustained without leave to amend, we

                                             10
decide whether there is a reasonable possibility that the defect can be cured by
amendment: if it can be, the trial court has abused its discretion and we reverse; if not,
there has been no abuse of discretion and we affirm. [Citations.] The burden of proving
such reasonable possibility is squarely on the plaintiff. [Citations.]‟” (Zelig v. County of
Los Angeles (2002) 27 Cal.4th 1112, 1126.) ACS does not indicate how it could amend
the petition to show there is no adequate remedy at law and there is no reasonable
possibility that this defect can be cured by amendment.
                                      DISPOSITION
       The judgment is affirmed. The Labor Commissioner shall recover costs on appeal.
(Cal. Rules of Court, rule 8.278(a)(1) & (2).)

                                                        DUARTE                      , J.

We concur:

           NICHOLSON                        , Acting P. J.

           MURRAY                           , J.

                                             11
Filed 9/27/13
                               CERTIFIED FOR PUBLICATION

                IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                                THIRD APPELLATE DISTRICT
                                             (San Joaquin)
                                                 ----

AMERICAN CORPORATE SECURITY, INC.,                                  C070504

                  Plaintiff and Appellant,                         (Super. Ct. No.
                                                             39201100270100CUWMSTK)
        v.

JULIE SU, AS LABOR COMMISSIONER, ETC.,

                  Defendant and Respondent.

      APPEAL from a judgment of the Superior Court of San Joaquin County,
Duane Martin, Judge. Affirmed.
      Cassel Malm Fagundes, Scott Malm and Dorothy Luther, for Plaintiff and
Appellant.
      David Lawrence Bell, for Defendant and Respondent.

THE COURT:

        The opinion in the above-entitled matter filed on September 10, 2013, was not
certified for publication in the Official Reports. For good cause it now appears the

                                                  12
opinion should be published in the Official Reports, and it is so ordered.

NICHOLSON, Acting P.J.

MURRAY, J.

DUARTE, J.

                                            13