How Local Governments Raise Money in the Post-Prop. 13 Era

The Los Angeles Times has this interesting story about the use by local governments of creative sale and lease-back schemes by which they issue debt without securing voter approval. Meanwhile, here is the latest from Sacramento on the Governor's plan to solve the budget crisis. Not much detail.

Tom Campbell's Ideas For Solving The Budget Crisis

Former Congressman and State Finance Director Tom Campbell has penned this article on solving the State's budget crisis. His answer? Compromise. And here is the Sacramento Bee's latest report.

New Initiative Filed To Change Super-Majority Vote Requirements

Here is an article from the Los Angeles Times on the filing of a new initiative that would lower the super-majority requirement for passing a budget. "The California Budget Efficiency Act would retain a super-majority requirement for budgets and taxes but would lower it from the current two-thirds to 55%. As a tactical matter, that would be enough for Democrats to pass budgets as the Legislature currently is constituted." Here is a link to the measure itself.

Bob Egelko on Jerry Brown

Veteran legal affairs reporter Bob Egelko has this interesting story on Jerry Brown's decision to oppose Prop. 8. Not surprisingly, the reaction breaks down around partisan lines--but there's a nice little bite at former AG Deukmejian for suing the Governor in People ex rel. Deukmejian v. Brown, for which he was chastised by the California Supreme Court. (We represented the State Personnel Board in the companion case, Pacific Legal Foundation v. Brown.) Here is an article from the Los Angeles Times on the AG's decision not to endorse the Petitioners' "revision" argument but to offer another, alternative basis for invalidating Proposition 8.

Supreme Court Denies Review In Judicial Perks Case

The Supreme Court denied review yesterday in Sturgeon v. County of Los Angeles. in which the Court of Appeal invalidated county supplements to judicial salaries. So it's up to the Legislature to find a solution. However, it may have other matters on its plate . . . .

More on the Budget Battle

Here is the latest from the Los Angeles Times on last week's budget battle, an article which claims that he Governor is sending conflicting signals regarding the legality of the Democratic plan. And here is an article from the San Francisco Chronicle's web site tonight, on the current stage of budget negotiations. Articles dated earlier today had claimed that progress was being made, but the outlook tonight is more uncertain.

ps. Here's an interesting editorial from the Los Angeles Times urging the repeal of the Constitution's super-majority requirements for budgets and taxes, and proposing some interesting alternatives.

More Proposition 8 Briefs

Here is the right-side up version of the AG's brief, and here is the other brief filed by the proponents (they did not file one in Tyler).

Superior Court Does Not Enjoy Discretionary Immunity From Anti-Discrimination Statutes

The Court of Appeal has rejected the contention that the judiciary enjoys immunity under the California Constitution against claims of discrimination. In DeJung v. Superior Court (no, it's not a writ of mandate proceeding), the court rejected the claim that a superior court had discretionary immunity against a claim based on age discrimination. Here are the crucial two paragraphs, and good they are, too:

"It is true that California trial courts have the constitutional and statutory power to select subordinate judicial officers who will assist the courts’ judges in performing their duties. (Cal. Const., art. VI, § 22 [“The Legislature may provide for the appointment by trial courts of record of officers such as commissioners to perform subordinate judicial duties.”]; § 71622, subd. (a) [“Each trial court may establish and may appoint any subordinate judicial officers that are deemed necessary for the performance of subordinate judicial duties . . . .”].) Certainly, that prerogative includes the discretion to determine which candidate for such a position is best suited to a court’s needs at a given time. But neither the trial judge’s statement of decision nor the Superior Court’s brief on appeal cites any authority for the proposition that in making this determination, courts may apply invidiously discriminatory criteria upon which other employers, including other government entities, are forbidden to rely. Indeed, as already discussed, FEHA specifically provides to the contrary.

Moreover, this remarkable suggestion is inimical to the core governmental responsibility entrusted to the courts: to provide for a public justice system that is unfailingly unbiased and impartial. (See generally Cal. Stds. Jud. Admin., §§ 10.20, 10.21 [courts have duty to refrain from bias in conducting proceedings, and not to discriminate in recruiting for court-appointed positions]; Cal. Code Jud. Ethics, canon 3C [judges shall discharge administrative responsibilities without bias or prejudice; shall exercise the power of appointment impartially on the basis of merit; and shall not engage in conduct that would reasonably be perceived as bias, including bias based on age].) Given this public trust, it is unimaginable that state law could be interpreted correctly as legally empowering the Superior Court itself to discriminate in selecting subordinate judicial officers on a basis prohibited under FEHA."

Commission Can't Continue Preliminary Hearing

Article VI, Section 22 provides: “The Legislature may provide for the appointment by trial courts of record of officers such as commissioners to perform subordinate judicial duties." Does a commissioner have the power to continue a preliminary hearing in a criminal cases, where the parties disagree over whether a continuance should be granted. No, said the Court of Appeal in Harutyunyan v. Superior Court (here). The matter was contested and involved important rights, such a the defendant's right to a speedy trial.

State's Failure To Pay Local Mandates Violates Prop. 4

The San Diego Superior Court has held that the State's failure to adequately reimburse school boards for dozens of state mandates violates Proposition 4, an initiative constitutional amendment adopted in 1979 that, among other things, requires the State to pay local government when it requires them to implement State policies. The Legislature apparently acknowledged the mandate (according to this story in the Sacramento Bee (here)), but only paid $1,000 per year to fund it. That wasn't enough, said the San Diego Superior Court.

Briefs in Proposition 8 Cases

Here are some of the briefs filed today in the Proposition 8 cases, which are not yet available on the California Supreme Court's website. Here is the answer filed by Respondents Scott and Horton. The brief filed by the Attorney General is here; unfortunately, it was scanned upside down, so to read it you either need to print it or stand on your head in front of your computer. The brief filed by the proponents is here. Of course, the big news is that the Attorney General contends that Prop. 8 is unconstitutional. Interestingly, though, he has a different argument than the Petitioners. He does not claim that Prop. 8 is a revision of the California Constitution; indeed, he says it isn't. Instead, he argues that, even if it is a constitutional amendment rather than a revision, the initiative power doesn't give the electorate the right to take away fundamental rights from a suspect class. Here are articles about the AG's position from the Sacramento Bee (here), the New York Times (here). the Los Angeles Times (here) and the San Francisco Chronicle (here).

More Stories on the Budget Confrontation

Dan Walters in the Sacramento Bee has this article about yesterday's budget events.

Governor Will Veto Democratic Budget Proposal

According to the San Francisco Chronicle (here), Governor Schwarzenegger has said he will veto the Democratic tax proposal passed by the Legislature with a majority vote. Whatever the political or economical wisdom of the veto may be, it will spare the State litigation over whether the budget proposal required a two-thirds vote under the portion of Proposition 13 that requires a super-majority for certain tax increases. Here is the analogous story from the Los Angeles Times.

Can The Democrats Increase State Revenues Without A Two-Thrds Vote?

The Los Angeles Times reports here on a proposal by legislative Democrats to fill state coffers by labeling revenue increases "fees" rather than "taxes," thus avoiding the need for the two-thirds vote required by Proposition 13. We'll provide more details as soon as we get them. And here is the relevant article from the San Francisco Chronicle and here is the corresponding article from the Sacramento Bee. This could get interesting.

Dan Walters' Skeptical Take On A Constitutional Convention

Here is Sacramento Bee columnist Dan Walters on the proposals for a constitutional convention. He is skeptical, not without reason. Why shouldn't the conflict that paralyzes the Legislature characterize a convention, too? And here is a Los Angeles Times article asking whether California is too unwieldy to govern.

Assistance of Counsel Requires Bar Membership

In In re Johnson (1992) 1 Cal.4th 689, 694, the Supreme Court held that “representation by an attorney who has submitted a resignation with disciplinary proceedings pending, and has as a result been placed on inactive status, denies a criminal defendant the counsel guaranteed by article I, section 15 of the California Constitution.” Moreover, the error is reversible per se. Id. at 701. But what if a criminal defendant's lawyer loses his license in the middle of a trial? That's what happened in People v. Vigil (here) and the Court of Appeal held that the defendant was entitled to a new trial, even if the defrocked lawyer did a good job in the last day of a four-day trial.

Supreme Court Denies Review in Judicial Reference Case

The Supreme Court has denied review in Treo@Kettner, the judicial reference/jury waiver case discussed here and here previously. So judicial reference agreements contained in CC&Rs are now unenforceable.

New Pleadings in Proposition 8 Case

San Francisco has filed a motion to amend its petition in its Proposition 8 case. (It has also associated Howard Rice as co-counsel.) The motion to amend is here. Here is the filed second amended petition.

Pleadings in Redevelopoment Challenge

I've posted earlier (here) about the legal challenge brought by the redevelopment agencies against the Legislature's attempt to raid their funds. Here is a copy of the petition and here is the memo filed by the petitioners.

Suit Challenges Redevelopment Fund Raid

According to the Sacramento Bee (here), the California Redevelopment Association, an umbrella organization for local redevelopment agencies has filed a lawsuit challenging the Legislature's attempt in this year's budget trailer bill to "raid" redevelopment funds. The lawsuit is based on Article XVI, Section 16, which provides for the taxation of property located in a redevelopment area. The suit apparently contends that this provision requires that the "tax increment" portion of property located in a redevelopment area--the portion presumably attributable to the redevelopment--be used only for redevelopment related purposes. It's worth noting that previous challenges to the Legislature's attempt to raid local government funds have been unsuccessful.

New PPIC Poll on Proposition 8

The Public Policy Institute of California has released two polls: one on Proposition 8 and the other a more general survey of "Californians and Their Government." Here is a "Capitol Alert" from the Sacramento Bee summarizing the results and here is the analogous article from the San Francisco Chronicle. And here is a link to the PPIC summary of its findings re Proposition 8, a link to the summary of "Californians and Their Government" and a link to the full report. The Prop. 8 survey found that the best predictors of votes on Prop. 8 were religious affiliation and socio-economic status, not race (although they didn't break down the "non-white" category by ethnicity). The poll also says that opposition to same-sex marriage has declined since 2000 and 2004, but has remained constant since 2005. Finally, the broader poll found that, paradoxically, Californians like the initiative process, trusting themselves more than their elected officials, but feel that there are too many initiatives, too much money is spent on them and they are too confusing.

Can the Legislature Suspend Income Tax Indexing?

According to this article by Dan Walters of the Sacramento Bee, the Legislature is considering suspending income tax indexing for a year to help solve the State's budget crisis. But there's a problem. Proposition 7, a statutory initiative adopted in June 1982, requires permanent indexing of the income tax. For the Legislature to "suspend" indexing would therefore seem to conflict with the statute. Accordingly. this would be an impermissible amendment by the Legislature of a statutory initiative. (Prop. 7 does not contain a provision permitting the Legislature to amend it.) Cases such as Franchise Tax Board v. Cory have given a pretty broad reading of what constitutes an amendment to a statutory initiative; the statute enacted by the Legislature doesn't have to formally amend the initiative statute, only to conflict with it.

Environmentalists Rely on California Constitution To Stop Water Diversions

Accpording to this article in the Sacramento Bee, environmentalists are invoking the California Constitution in an effort to stop the diversion of water to irrigate contaminated farmland. This should be interesting. Stay tuned.

Are the State and Local Officials Legally Holding Their Offices?

The oath of office contained in Article XX, Section 3 contains a relic from the McCarthy era: a loyalty oath for state and local office holders. It was ruled invalid in 1967. Yet a group called the Free Enterprise Society complains that all state and local officials are holding office illegally because they haven't taken the oath of office with the full constitutionally-prescribed oath. Carlos Alcala of the Sacramento Bee reports here. Of course, if this group brought a lawsuit, the judges hearing it would have to recuse themselves, because they hadn't taken the supposedly required oath, either. No doubt the "rule of necessity" would kick in, enabling the judges to dispatch this claim with celerity.

California Constitution's Religion Clause Does Not Protect Against Criminal Prosecution for Selling Pot

Did you ever think that the California Constitution prohibits the prosecution of someone selling pot in a "temple" (complete with vending machines) devoted to that purpose? I didn't and, more importantly, neither do the Justices of the Second Appellate District, Division Six. Here is the decision in People v. Rubin, which concludes with the following: "appellant's theory is at variance with not only constitutional law, it is at variance with common sense."

Should State Constitutional Conventions Be More Frequent?

Here is an article in the New Republic that says so. Interestingly, some states have automatic referenda asking their citizens every couple of decades whether they want to hold a convention to revise their state constitution. Here, in California, we haven't had one since 1879--though we did, of course, have a massive revision process in the 1960's and 1970's, courtesy of the Legislature and the Constitution Revision Commission. Given the heterogeneity of our State, a convention would be pretty wild.

ps. Here is a resolution introduced by AssemblymemberBlakeslee that would ask the voters to decide whether there should be a constitutional convention to revise the constitution. Here is an opinion piece from the Los Angeles Times on the Blakeslee resolution and a similar resolution introduced by Mark DeSaulnier, a Democratic legislator. Here is an article from the Contra Costa Times on DeSaulnier and his resolution.

Governor Celebrates Victory of Proposition 11

This article, from today's San Francisco Chronicle, reports that the battle for Proposition 11 is finally over, with the redistricting reform initiative passing. The Governor is happy and the Democrats are unhappy.

The First Amendment and the Anti-SLAPP Statute

In Schaffer v. City and County of San Francisco (here), the court clarified the scope of speech protected by the anti-SLAPP statute. The plaintiff contended that certain statements made by the defendant police officers were not protected by the anti-SLAPP statute because, as speech made by police officers in the course of their employment, the statements were not protected by the First Amendment under Garcetti v. Ceballos, 547 U.S. 410 (2006), which had held that a district attorney had no First Amendment protection against disciplinary action based on statements made in the course of his employment, even though the statements involved a matter of public concern.)

Code of Civil Procedure Section 425.16(b)(1), the anti-SLAPP statute, provides in relevant part that "[a] cause of action against a person arising from any act of that person in furtherance of the person’s right of petition or free speech under the United States or California Constitution in connection with a public issue shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim. " Section 425.16(e) in turn defines "any act . . . in furtherance of the person's right of petition or free speech under the United States or the California Constitution in connection with a public issue’" as including "(1) any written or oral statement or writing made before a legislative, executive, or judicial proceeding, or any other official proceeding authorized by law; (2) any written or oral statement or writing made in connection with an issue under consideration or review by a legislative, executive, or judicial body, or any other official proceeding authorized by law; (3) any written or oral statement or writing made in a place open to the public or a public forum in connection with an issue of public interest; (4) or any other conduct in furtherance of the exercise of the constitutional right of petition or the constitutional right of free speech in connection with a public issue or an issue of public interest." Consequently, as the Schaffer court held, whether speech is protected for purposes of the anti-SLAPP statute turns on this definitional statute, not on whether the speech is protected in the abstract under the federal or state constitutions. In this case, the speech was protected despite Garcetti, because it was "made in connection with an issue under consideration or review by a legislative, executive, or judicial body," and thus satisfied Section 425.16(e)(2).

Proposition 13 and the Budget Crisis

Daniel Weintraub of the Sacramento Bee has an interesting article, available here, on the impact of property tax reassessments on local finance. If you bought at the height of the housing bubble and the value of your house is now less than what you paid, you can get your property reassessed for property tax purposes. Similarly, foreclosure on a house will usually result in a sale price that is below the last purchase price, thus triggering reassessment at a lower value. All this translates into less money for local governments. And since the state is already in a giant financial hole itself, it won't come to the aid of cash-strapped local governments. It's hard to be a government that doesn't have a printing press.

Petition For Review Filed In Judicial Salary Case

Here is the petition for review filed by Los Angeles County in Sturgeon v. County of Los Angeles, the judicial salary case. Many amicus letters have been filed in support of the petition, but none that I have seen adds much to the legal arguments made by the petition.

Besides contending that the decision below will lead to calamitous results for the administration of justice, the petition makes two legal arguments about how the decision below erred. First, as discussed in previous posts (here and here), the petition contends that the Court of Appeal wrongly held that the doctrine requiring deference to legislative interpretations of the Constitution applies only when the constitutional provision and the relevant legislation were contemporaneous. There are numerous counter-examples, including the decision in Pacific Legal Foundation v. Brown, 29 Cal. 3d 168 (1981), in which I represented the State Personnel Board. Second, the petition argues that the Court of Appeal misconstrued the nondelegation doctrine in disallowing the Legislature's attempt to give the counties total discretion to supplement the "base" judicial salary.

The plaintiffs did not file an answer to the County's petition for rehearing in the Court of Appeal, because the court did not request one. It will be interesting to see what they say in response to the petition. At that point, we'll evaluate the arguments and make a prediction about the grant of review.

Answer and Reply Filed In Judicial Reference Case

Here is the Answer to the Petition for Review and here is the reply to the answer filed in Treo@Kettner Homeowners Ass'n v. Superior Court, the judicial reference case. And here is a link to my earlier post about the petition for review.

The strength of the petition turns on whether the decision below conflicts with Villa Milano v. Il Davorge, 84 Cal. App. 4th 819 (2004). The decision below refused to apply a clause in CC&Rs authorizing judicial reference in a construction defect case between a developer and a homeowners association. Villa Milano held that an arbitration clause in CC&Rs created a written agreement to arbitrate, but held the provision procedurally and substantive unconscionable as applied to construction defect claims against the developer that devised the CC&Rs in the first instance.

The petitioner, of course, relies on the portion of Villa Milano holding that the arbitration clause in the CC&Rs constituted a written agreement to arbitrate. The respondent relies on the Villa Milano court's ultimate refusal to enforce the arbitration clause.

Although non-signatories are bound by arbitration clauses in a variety of contexts--for example, an employee signing a health insurance contract can agree to arbitrate medical malpractice disputes on hehalf of non-signatory family members--the situation here is different. Here, the CC&Rs are not the result of any sort of adversarial bargaining--instead, they are promulgated by a developer and signed by a homeowners association that the developer has created and before the association has any members. So I think the result reached by the Court of Appeal is right--though the Supreme Court may be persuaded by the importance of the issue or the conflict claim to grant review.

Los Angeles Times Ponders Justice Kennard's Vote

Here is an article from yesterday's Los Angeles Times about the potential significance of Justice Kennard's vote to deny the petitions without prejudice to the filing of an appropriate action to determine the retroactivity issue.

Vik Amar And Claire Cooper On The Proposition 8 Cases

Here is the first installment of a series of articles by Vik Amar on the Proposition 8 cases. In this introductory column he sets the stage and does a little prognosticating, based on the Supreme Court's orders from last week. More to come, apparently. And here is an article on the cases by the Sacramento Bee's veteran legal affairs reporter Claire Cooper.

Supreme Court Defers Ruling on Last Three Prop. 8 Cases

The California Supreme Court has issued the following order in the latter three of the six Proposition 8 cases--i.e., those filed by civil rights groups, women's groups and churches: "In light of the order issued by this court in cases number S168047, S168066, and S168078 on November 19, 2008, further action in this matter is deferred pending further order of this court. The parties to this action are invited to file an an application to file an amicus curiae brief, accompanied by the proposed brief, in the referenced cases within the time period set forth in the November 19, 2008, order."

Grodin Writes Article On State Constitutional History

Professor (and former Justice) Joe Grodin has written an article for the newsletter of the California Supreme Court Historical Society entitled "The California Supreme Court and State Constitutional Rights: The Early Years." A link to the article is here. It's quite interesting, focusing on the constitutional decisions rendered by the California Supreme Court in the first dozen years of its existence. There were several cases dealing with slavery, particularly the then-divisive question of whether a slave brought with his or her master into a free state like California was entitled to his freedom. The court's record was mixed, to say the least, but at least there is nothing as egregious at Dred Scott. There were also cases dealing with the constitutionality of sunday closing laws and the uniformity requirement of the state constitution. Thanks to Jon Steiner for calling the article to my attention.

Court Issues Order in Proposition 8 Case

The Supreme Court has issued the following order in the Prop. 8 cases. As predicted the court has denied the request for a stay and set a briefing schedule. The issues to be briefed include retroactivity--i.e., the effect of Prop. 8 (if valid) on marriages performed before its effective date. Here's the text of the order:

The motion for judicial notice filed in S168047 by petitioners on November 5, 2008, is GRANTED. The requests for a stay of Proposition 8 filed by petitioners in S168047 and in S168066 are DENIED. Respondent Secretary of State Bowen's request to be dismissed as a respondent in S168066 is GRANTED. (Kevelin v. Jordan (1964) 62 Cal.2d 82.) The motions to intervene in S168047, S168066, and S168078, filed on November 17, 2008, by Proposition 8 Official Proponents et al. are GRANTED. The motions to intervene in S168047, S168066, and S168078, filed on November 10, 2008, by Campaign for California Families, are DENIED.
The State of California, the Attorney General, the State Registrar of Vital Statistics, and the Deputy Director of Health Information and Strategic Planning of the California Department of Public Health are ORDERED TO SHOW CAUSE before this court, when the above entitled matters are called on calendar, why the relief sought by petitioners should not be granted.
The issues to be briefed and argued in these matters are as follows:

(1) Is Proposition 8 invalid because it constitutes a revision of, rather than an amendment to, the California Constitution? (See Cal. Const., art. XVIII, sections 1-4.)

(2) Does Proposition 8 violate the separation of powers doctrine under the California Constitution?

(3) If Proposition 8 is not unconstitutional, what is its effect, if any, on the marriages of same-sex couples performed before the adoption of Proposition 8?

The return is to be filed by respondents, and a brief may be filed by intervenors, in the San Francisco Office of the Supreme Court on or before Friday, December 19, 2008. A reply may be filed by petitioners in the San Francisco Office of the Supreme Court on or before Monday, January 5, 2009.

Any application to file an amicus curiae brief, accompanied by the proposed brief,
may be filed in the San Francisco Office of the Supreme Court on or before Thursday, January 15, 2009. Any reply to an amicus curiae brief may be filed in the San Francisco Office of the Supreme Court on or before Wednesday, January 21, 2009.

Moreno, J. joins this order except that he would grant the requests to stay the operation of Proposition 8 pending this court's resolution of these matters.

Kennard, J. would deny these petitions without prejudice to the filing in this court of an appropriate action to determine Proposition 8's effect, if any, on the marriages of same-sex couples performed before Proposition 8's adoption.

Votes: George, C.J., Baxter, Werdegar, Chin, Moreno, and Corrigan, JJ.

Prop. 8 Panel on December 10

There will be a panel on Proposition 8 the morning of Wednesday, December 10. The panel will discuss the constitutional issues raised by the pending litigation as well as what to do in the interim. The panel will be led by Jim Brosnahan, and the panelists includes my partner Bobbie Wilson, one of the Howard Rice lawyers who represented the City in the Marriage Cases. Here's the form to register if you want to attend.

Will Prop. 8 Decision Spawn a Recall?

This article from the Los Angeles Times discusses the possibility of a recall should the California Supreme Court invalidate Proposition 8. It quotes Justice Kaus' famous remark about the pendency of judicial elections being a "crocodile in the bathtub." For those too young to recall, Justice Kaus was referring to the Court's decision in Brosnahan v. Eu, 31 Cal. 3d 1 (1982), where the Court refused to remove another Proposition 8 (that dealt with criminal justice) from the ballot on single-subject grounds. (The measure passed and the Court upheld it against a single-subject and other challenges in Brosnahan v. Brown, 32 Cal. 3d 236 (1982).)

Rick Hasen has also linked to this article on his election law blog (here). His thought that the Court was likely to summarily deny the petitions seems wrong--there's too much of a tradition in California of immediate post-election review by the California Supreme Court for that to happen. Rightly or wrongly, a summary denial would be seen as either a punt to the Legislature or a clear indication that the Court finds the case meritless. A summary denial is even less likely to happen now that the AG has weighed against it (as have some of the Prop. 8 supporters).

We'll probably know more this afternoon, after the Court holds its weekly conference. My prediction is that the Court will deny a stay and set a briefing schedule.

Is Proposition 8 Vulnerable Under Romer?

This article, by Hastings Professor Brian Gray, argues that it is. But none of the petitioners are making this argument in the California Supreme Court. Presumably no one wants to open the door for possible review by the United States Supreme Court.

ps. Equal Rights Advocates and the California Women's Law Center have filed the fifth petition (here) challenging the measure. And here is a sixth petition, filed by the California Council of Churches.

New Filings In Proposition 8 Cases

The Attorney General has filed preliminary oppositions in the Proposition 8 cases. (The one in Strauss is here.) Interestingly, the AG does not take a position on the merits, but simply urges the Court to (a) hear the case and (b) deny a stay. Proposed intervenors have also filed a preliminary opposition; here's the one in Strauss. I would expect the Court to rule on the stay and issue a briefing schedule pretty soon, perhaps after this Wednesday's conference.

Would Extending the Sales Tax To Services Violate Proposition 218?

As part of his plan to solve California's fiscal crisis, the Governor is proposing to extend the sales tax to services. In an article (here), the Howard Jarvis Taxpayers Association contends that this would violate Prop. 218. Here's their rationale: extending the reach of the sales tax would also increase that portion of the tax (the Bradley-Burns tax) that goes to local entities. That can't be done under Proposition 218 without a vote of each local governing body and each local electorate.
Here's the contrary argument: Prop. 218 focused exclusively on tax measures approved at the local level. But Article XIII A, Section 3--part of Proposition 13--permits the Legislature to approve tax increases--whether state or local--by a two thirds vote. If that requirement is met, the constitution is satisfied. Indeed, the central vice of HJTA's argument is that it proves too much--under it, the Legislature could never expand the list of items subject to the sales tax. That can't be right.

Here's the comeback: By its terms, Article XIII A, Section 3 covers only "changes in state taxes enacted for the purpose of increasing revenues collected pursuant thereto." The local sales tax is not a "state tax" for purposes of this provision, since the revenue goes to local governments. Indeed, according to HJTA, the Governor's sales tax proposal expressly refers to "all current applicable state and local taxes." Since even the Governor recognizes that the sales tax includes both state and local taxes, you can't use Prop. 13 to get around Prop. 218.

In response, the State would have to argue that the entire sales tax is a "state tax" for purposes of Article XIII A, Section 3, regardless of whether the money winds up going to the state or local governments. That's a better argument than you might think, because for about half a century the sales tax has been almost entirely a creature of state law. For example, in 2004 the state enacted something colloquially known as the "triple flip," by which the local sales tax was reduced by .25 percent, the state sales tax was correspondingly increased (to pay for deficit reduction bonds), and local government's loss of revenue was backfilled through the property tax. Moreover, the sales tax is administered by a state agency pursuant to uniform statewide rules. And, most importantly for this issue, the universe of transactions subject to the tax is fixed by state law (and probably has been for the last half-century, well before the passage of both Proposition 13 and Proposition 218). So the sales tax is a "state tax" for purposes of Article XIII A, Section 3 regardless of where the money goes, at least insofar as state law determines which commercial transactions are subject to the tax and which are not.

If and when the sales tax is extended (perhaps a doubtful proposition in itself), it will be interesting to see how this plays out.

Was The Marriage Decision A Revision of the Constitution?

At a conference on the California Supreme Court on Friday, Santa Clara Law School professor and California Supreme Court scholar Gerry Uelmen asked the following question: "If Proposition 8 is a revision of the California Constitution, does that mean that the Court's original decision in the Marriage Cases was also a revision"? Here's a link to the Los Angeles Times story about the conference.

The Constitution and Post-Judgment Interest

Article XV, Section 1, subdivision 2 provides that "The rate of interest upon a judgment rendered in any court of this State shall be set by the Legislature at not more than 10 percent per annum." And, indeed, the Legislature has set the rate at 10%. However, under the statutory scheme for renewing a judgment, a renewed judgment earns interest at 10% on both the unpaid amount of the underlying judgment and post-judgment interest accrued before the judgment was renewed. In other words, the judgment creditor, in effect, gets compound interest--i.e., interest on the accrued post-judment interest. Does this statutory scheme violate Article XV, Section1? The Court of Appeal has said no, in a decision entitled OCM Principal Opportunities Fund v. CIBC World Markets Corp. (here).

One of the most interesting things about the decision is the deference that the court gave to the Legislature's interpretation of the relevant constitutional provision. This deference stands in sharp contrast to the lack of deference exhibited in the Court of Appeal's decision in Sturgeon, the judicial salaries case. I would be surprised if this decision didn't figure prominently in the petition for review that will undoubtedly be filed in that case, which is due on Nov. 19.

New Lawsuit Filed Challenging Prop., 8

Several civil rights groups, including the Asian Pacific American Legal Center, the Mexican American Legal Defense and Educational Fund, the Equal Justice Society, the California NAACP and the NAACP Legal Defense and Educational Fund, Inc., have filed another challenge to Proposition 8. Here's a link to their petition. The brief argues that in order to protect the fundamental rights of all Californians, a higher standard is required to overturn the right to marry. The brief was filed by Raymond C. Marshall of Bingham McCutchen and Prof. Tobias Barrington Wolff of University of Pennsylvania Law School.

Court of Appeal Clarifies Duties to Prisoners

In Giraldo v. CDCR (here), the Court of Appeal has decided several important issues relating to tort claims brought by prisoners. First, the court held that prison officials owe a "special duty of care" to protect prisoners from assaults by third parties (i.e., fellow prisoners) that can be breached by negligent conduct on the part of the officials. While there was no California case on point, the court analogized the relationship between prisoner and jailer to other "special relationships" where, because of the plaintiff's vulnerability, a duty to protect against foreseeable harm caused by third parties exists. The conclusion reached by the court is also supported by the Restatement and several decisions from courts in other states.

Second, the court held that there is no private right of action for damages for a violation of the "cruel or unusual punishment" clause of the California Constitution, Article I, Section 17. Relying heavily on Katzberg v. Regents, 29 Cal. 4th 300 (2002), where the Supreme Court had held that there was no cause of action for damages for a violation of the State Constitution's due process clause, the court in this case held that there was no evidence of any intent to create such a right and there were alternate remedies available, including the tort remedy recognized by the court and a federal claim for violation of the Eighth Amendment. There is a cause of action for declaratory and injunctive relief for violation of Article I, Section 17, but no such relief was available in this case because the prisoner had been released from custody.

While the state may file a petition for review on the tort issue, and the prisoner on the constitutional issue, it's hard to see why the California Supreme Court should take this case. The tort result is hardly radical; as noted above, it's supported by the Restatement of Torts. And the constitutional ruling closely follows Katzberg. All in all, a thoughtful opinion by Judge Richman.

How To Reform the Initiative Process

Bob Stern and Tracy Westen have written an interesting op-ed piece for the Los Angeles Times on how to reform the initiative process. It's available here. Now all it takes is legislative action or a billionaire or two to put it on the ballot.

Court Requests Opposition in Prop. 8 Cases

The Supreme Court has requested that the Attorney General file an opposition in the Prop. 8 cases. Here's the text of the letter sent to the AG:

"The court has directed that I request preliminary oppositions to the above referenced matters. The oppositions are to be served upon counsel for petitioners, by facsimile and filed in this court on or before November 17, 2008, by 12:00 p.m. The oppositions may be filed by facsimile at (415) 865-7183 with original and 13 hard copies to follow by mail."

There has been no ruling yet on the motions to intervene.

Supreme Court Has New Site for Prop. 8 Filings

The California Supreme Court now has a dedicated page with links to all the filings in the Prop. 8 cases. Here's the link.

Motions to Intervene Filed in Proposition 8 Cases

The Campaign for California's Families has filed a motion to intervene in the three cases pending in the California Supreme Court challenging Prop. 8. One of the motions is available here. And here is a letter filed in support of the petition in Strauss by Gibson, Dunn on behalf of numerous members of the California Legislature.

More Articles on Proposition 8

Here's an article by Boalt Dean and Professor Goodwin Liu on the legal issues raised by the Prop. 8 challenge. And here's the latest post by Jeffrey Rosen on whether the California Supreme Court was wise to recognize same-sex marriage, in light of the election results.

Update on Proposition 11

While the opponents of Proposition 8 have conceded, the fate of Proposition 11 is still uncertain. At the moment, according to the Secretary of State's web-page (here), it's leading by a little less than 140,000 votes. That sounds like a lot, but according to the SOS's "unprocessed ballot report" (here), there are 2.7 million ballots still to be counted. That seems like an incredible number four days after the election. This could take a while.

A Right To Fish?

Did you know you have a right to fish under the California Constitution? Article I, Section 25 states that "[t]he people shall have the right to fish upon and from the public lands of the State and in the waters thereof . . . ." So San Francisco attorney Karl Olson, no stranger to constitutional litigation, has filed a lawsuit against the owner, operator and pilot of the Cosco Busan, the tanker that one year ago today sideswiped a support tower for the Bay Bridge. The lawsuit was filed as a class action contending that the oil spill eliminated the plaintiffs' right to fish in part of the San Framcisco Bay. Here's a link to the article in the Chronicle describing the case, and here (thanks to Karl Olson) is a copy of the complaint. But does Article I, Section 25 contain a "state action" requirement? Stay tuned.

More on the Proposition 8 Litigation

The California Supreme Court has posted the pleadings from all three Proposition 8 cases on the court's website (here). And Jeffrey Rosen has written an interesting article on the relationship between the California Supreme Court's prior decision in the Marriage Cases and Proposition 8's success (here). And here is a news article quoting California Supreme Court scholar Gerry Uelmen, who is pessimistic about the petitioners' "revision" argument.

Court of Appeal Modifies Sturgeon Opinion

The Court of Appeal has issued an order (here) changing some of the language in the Sturgeon opinion, but not the result or the essential details of the court's reasoning. Some changes correct typos, while others are (slightly) more substantive. The most significant change is the addition of a new paragraph to the conclusion, which reads like an attempt to minimize the significance of the decision (and presumably decrease the likelihood of Supreme Court review): "As we have noted, there are valid reasons the county provides its judges with generous employment benefits beyond the employment benefits provided by the state. However, the defect we have found in the method by which those benefits have been provided is itself substantial and important. Under our constitutional scheme, judicial compensation is a matter of statewide concern and the Legislature must set policy with respect to all aspects of judicial compensation. As the cases we have discussed demonstrate, the Legislature's obligation to 'prescribe judicial compensation' requires that it set forth standards or safeguards which assure that fundamental policy is implemented. The fact that the Legislature provided counties a credit for judicial benefits when it enacted Lockyer-Isenberg or that it assured the counties that judicial benefits would not be decreased as a result of trial court funding does not meet these requirements. The obligation is not onerous, but does require that the Legislature consider the specific issue and, at a minimum, establish or reference identifiable standards."

Other Election News

Proposition 8 was not the only initiative that passed yesterday amending the California Constitution. Propositions 9 and 11 also passed. (The links are to the Attorney's General's title and summary, from which you can navigate to the analysis, the ballot arguments and the text of the two measures.) So now crime victims have more rights and reapportionment of the Legislature and State Board of Equalization (but not the House of Representatives) is in the hands of a citizens' commission.

First The Election, Then The Litigation

A day after the election, and the day that Proposition 8 becomes effective, the opponents of Proposition 8 have filed a petition for writ of mandate challenging its legality in the California Supreme Court. The petition is available here and a link to the Supreme Court's docket is here. And here is a link to the docket in the similar case filed by San Francisco, the City of Los Angeles and the County of Santa Clara (and here is their petition).

Reforming the Referendum and Initiative Process

Here's an interesting article from the Sacramento Bee (here), which proposes making referenda easier and initiatives harder. Interesting comparison between California's experience with direct democracy and that of Switzerland.

State Engineers Shafted Again

Article VII used to require--although it didn't say so explicitly--that the state could not contract for private employees to do jobs that civil servants could perform "adequately and competently." However, in 2000, the electorate passed Proposition 35, which added Article XXII. Article XXII provides that the State of California and all other governmental entities “shall be allowed to contract with qualified private entities for architectural and engineering services for all public works of improvement.”

This could have been read as simply removing the constitutional limit imposed on state contracting by the civil service provisions of the state constitution. Instead, it's been read as imposing a limit on the power of the Legislature to require that architectural and engineering work be performed by civil servants. The latest casualties are a series of statutes that required Caltrans employees to perform various tasks relating to the construction by the Los Angeles County Metropolitan Transportation Authority of a high occupancy vehicle lane on a state highway. The Court of Appeal (here) held these statutes unconstitutional, deciding that while "Caltrans may choose to have this work performed by its employees . . . the Legislature cannot mandate that Caltrans do so."

This may be a permissible--or even a faithful--interpretation of Proposition 35. But it does seem odd to say that an administative agency may achieve a result--deciding to do a particular job with state employees--that the Legislature could not compel by statute. After all, in our scheme of government administrative agencies are normally subordinate to statutes enacted by the Legislature. Offhand, I can't think of another example where administrative discretion has been enshrined in the Constitution.

You could almost argue that this would be a revision, rather than an amendment, of the California Constitution, which could not be accomplished by initiative under cases such as Raven v. Deukmejian. It would be interesting to see whether anyone has ever made this argument.

We've Been Noticed!

Our little blog has been noticed by the California Blog of Appeal (here) and the California Punitive Damages blog (here). Thanks to both bloggers (Greg May and Curt Cutting) for your kind words.

Petition for Rehearing Filed in Judges' Compensation Case

The County of Los Angeles has filed a petition for rehearing in the Sturgeon case, which had held the extra compensation given by the County to its Superior Court judges unconstitutional. The petition (available here) accuses the court of having failed to apply the presumption in favor of constitutionality and the rule that the Legislature's construction of constitutional provisions is entitled to deference. Notably, however, the second point ignores the relatively recent California Supreme Court decision in Hotel Employees v. Davis, 21 Cal. 4th 585 (1999), where the Court rejected the express finding in a statutory initiative that the casinos authorized by the measure were the same as those permitted by the governing constitutional provision (which at the time permitted only casinos that were similar to those existing in Nevada and New Jersey in 1984, when the provision was adopted). The petition also argues that the court misapplied the no-delegation doctrine and that its decision will lead to absurd results.

It will be interesting to see what the taxpayers say in response to what is undoubtedly a forceful and well-argued petition. I hope to do a more thorough analysis of the decision then. Stay tuned.

Court Holds That Government Can Spend Money To Create And Promote Future Initiatives

The Court of Appeal has clarified when public agencies can spend tax dollars on proposed measures. In Santa Barbara County Coalition Against Automobile Subsidies v. Santa Barbara County Association of Governments (here), a taxpayer group contended that the use of public funds to create and promote a sales tax extension constituted an unlawful use of public funds. The public agency responded by filing an anti-SLAPP motion, which the trial court granted. The plaintiff appealed and the appellate court affirmed. The court held that the public agency and its representatives had a First Amendment right to "issue reports and take positions on issues of public interest relating to their official duties." The court next held that the plaintiff could not show that the defendant's activities were unlawful. Because all the spending occurred prior to the qualification of the measure for the ballot, the rule prohibiting the use of public money in political campaigns was not violated. Consequently, the court held that a public agency may, in furtherance of its mission, hire a polling firm to determine how a proposed measure should be structured, and issue public reports advocating the proposed measure. "Although a government agency cannot spend public funds in a partisan campaign for the passage or defeat of a ballot measure, we conclude that, in this case, the activity of SBCAG was not electoral advocacy because it was in furtherance of its express statutory duties and occurred before Measure A was qualified for placement on the ballot. "

There is much to be said for this decision. If a governmental agency has the power to put a measure before the electorate, it surely has the right to determine how the measure may best be presented to the voters, and to build a record justifying the need for the measure. Of course, once the measure qualifies for the ballot, it becomes a partisan measure and public funds shouldn't skew the electoral balance. (But even then, of course government agencies have the right to express their support or opposition to a measure on the ballot; they just can't expend public funds to promote a particular electoral outcome.)

This case simply applies a line recognized in prior cases. It seems unlikely that the California Supreme Court would grant review.

Court Reaffirms Narrow Reach of Restitution Provision

Who has a right of restitution under Article I, Section 28(b)? In People v. Slattery (here), the defendant injured her mother, who was taken to the hospital and died ten days later. The trial court ordered the defendant pursuant to the restitution statutes to repay the hospital for the cost of treating her mother. The Court of Appeal held that this was impermissible because the restitution statutes provide relief only to "direct victims" of criminal activity, and the hospital was not a direct victim.

The state argued that the restitution statutes had to have a broader reach, because Article I, Section 28(b), which grants the right to restitution to “all persons who suffer losses as a result of criminal activity.” However, the Court of Appeal held that the California Supreme Court had rejected this argument in People v. Birkett, 21 Cal. 4th 226 (1999). There the Court held that the Legislature’s decision to limit the right to restitution to business and governmental entities that are “direct victims” constitutes “a plausible interpretation of th[is] constitutional provision.” Consequently, courts must accept the Legislature's determination.

What Does Article II, Section 4 Mean?

Article II, Section 4 provides that the Legislature "shall prohibit improper practices that affect elections." Apparently, it has never been the subject of litigation. That may change as the result of a lawsuit filed by the Howard Jarvis Taxpayers Association. In their trial brief (available here), the HJTA contends that the ballot label, title and summary that the Legislature prepared for Proposition 1A on this fall's ballot are misleading and not neutral. The HJTA lost in the trial court but is planning to appeal.

Putting aside the issue of whether the HJTA's characterization of the ballot label, title and summary of Proposition 1A are correct, the HJTA has a tough road to hoe. Article II, Section 4 doesn't prohibit the Legislature from doing anything. Instead, it's a grant of legislative authority. While it's possible to read "The Legislature shall do x" as meaning "The Legislature may not do not-x," that would violate the rule that constitutional limits on the Legislature's power have to be clear and explicit. Still, kudos to HJTA for finding a never-litigated provision the Constitution to hang its hat on (and thanks to Tim Bittle for sending me the trial brief).

Separation of Powers Leads Court To Narrow Criminal Conflict of Interest Statute

Government Code Section 1090 forbids state and local legislators and other officials from having a financial interest in a contract approved by them, or by a legislative body of which they are members. Can a legislator be convicted of aiding and abetting a section 1090 violation if he or she votes to approve a contract in which another public official has a financial interest? The Court of Appeal for the Fourth Appellate District, Division Three, has said "no," at least where (a) the legislator himself or herself has no economic interest in the contract; and (b) the alleged criminal activity consists entirely of acts connected to the legislative process--i.e., urging the passage of, or voting on, proposed legislation. The court based its ruling squarely on the separation of powers embodied in Article III, Section 3 of the California Constitution, while simultaneously acknowledging that that provision does not literally apply to local legislators.

The decision in D'Amato v. Superior Court (available here) grew out of the following facts. D'Amato was a member of the Plascentia City Council. In 2000, the council approved the formation of a Joint Powers Authority known as ONTRAC. D'Amato became one of the three ONTRAC board members. Becker was the City's Public Works Director, but he also wanted to be ONTRAC's general manager. The ONTRAC board hired Becker's company to be the general manager. Becker was indicted for violating Section 1090 and D'Amato was indicted for aiding and abetting Becker's Section 1090 violation. The trial court denied a motion to quash the indictment and D'Amato filed a writ petition to overturn that decision.

The court granted the writ. The court based its decisions on separation of powers principles that forbid courts from scrutinizing the motives of individual legislators. No such scrutiny is required for a "direct" Section 1090 violation, because the statute criminalizes the holding of a financial interest in a contract that is approved by the legislative body of which the defendant is a member regardless of whether the individual legislative defendant votes to approve the contract. However, such scrutiny is required for aiding and abetting someone else's violation of the statute. For example, one of the counts in the indictment was based on the fact that D'Amato voted to approve the JPA that created ONTRAC. But that's a quintessentially legislative act. So was approval of the contract between ONTRAC and Becker. In the absence of a showing that the legislator himself had a financial interest in the contract, there could be no aiding and abetting liability. As the court explained, a contrary ruling could place county district attorneys in a supervisorial role over all local legislators--a result the court found untenable: "Given the broad reach of criminal and civil liability under sections 1090 and 1097, applying aider and abettor liability to the financially-interested official’s fellow public servants would turn a powerful tool against financial conflicts of interest into a dangerous weapon enabling a prosecutor to seek removal of an entire legislative body, both duly elected officials and staff members, based on a single official’s financial interest. Equally troubling, a prosecutor could influence a public agency’s future legislative path by picking and choosing which officials and staff members to prosecute, and which to leave alone."

This is a fascinating decision and seems entirely correct. Indeed, the opinion stated that its interpretation of Section 1090 was consistent with all of the 423 cases listed in Shepard's as citing the statute, other than dicta in one opinion dating from 1952. No doubt the prosecutor will file a petition for review, claiming that the decision hampers his ability to safeguard the integrity of local officials. Even if that is untrue, the importance and novelty of the case may well lead the Supreme Court to grant review.

Petition for Review filed in Judicial Reference Case

Not surprisingly, the losing party in Treo@Kettner Homeowners Association v. Superior Court, has filed a petition for review in the California Supreme Court. In the petition (available here), filed by Charles Bird of the Luce Forward firm, the developer claims that the Court of Appeal decision refusing to enforce judicial reference provisions in CC&Rs squarely conflicts with Villa Milano Homeowners Association v. Il Davorge, 84 Cal. App. 4th 819 (2000), where the court enforced an arbitration provision in CC&Rs. (The Court of Appeal decision was discussed in a prior post, available here.) The petition surely seems right in stating that the same rules should govern enforceability of arbitration provisions and agreements for judicial reference; both provide valid methods of waiving a jury trial under Grafton Partners v. Superior Court, 36 Cal. 4th 944 (2005), since both have been approved by the Legislature. It also seems right in contending that the Court of Appeal decision presents an important issue of law--i.e., whether dispute resolution provisions in CC&Rs are valid as against non-signatories. It will be interesting to see what the Answer says in response. Stay tuned. (And thanks to Charles Bird for sending me the petition.)

Court of Appeal Clarifies "Full Text" Rule

When a local governing body approves a plan, but the approving ordinance merely incorporates the plan by reference rather than as an attached exhibit, does the plan have to be attached to a referendum petition seeking to submit the ordinance to the electorate? In a decision clearly foreshadowed by prior cases, the Court of Appeal for the First Appellate District, Division One, has answered this question "yes." In Defend Bayview Hunters Point Committee v. City and County of San Francisco (available here), the court held that the referendum petition failed to comply with the "full text" rule embodied in Elections Code Section 9238. Interestingly, the court expressly stopped short of holding that all documents incorporated by reference must be attached to a referendum petition. Instead, it summarized its holding as follows: "We do not hold here that all documents a local legislative body chooses to incorporate by reference in or attach to an ordinance must be included in a referendum petition. We hold only that when a central purpose of the ordinance is to adopt and enact into law the contents of an incorporated or attached document, a referendum petition on the ordinance does not satisfy Elections Code section 9238 unless it includes a copy of that document." The court also rejected the claim that this interpretation of Section 9238 violated the First Amendment, holding that the full text requirement did not reduce the number of available petition circulators, while serving the important state interest in providing information to potential referendum signers.

The decision is not particularly novel, inasmuch as prior cases such as Nelson v. Carlson, 17 Cal. App. 4th 732 (1993), had applied the full text rule and invalidated referendum petitions that did not contain exhibits to the challenged ordinances. However this was the first case that expressly considered the effect on the full text rule of incorporating by reference rather than by attachment. As such, its an important clarification of referendum law and one that referendum campaigns must heed at their peril

Court of Appeal Reaffirms That Initiative Can't Be Used To Compel Legislative Action

In Widders v. Furchtenicht, the Court of Appeal, Second Appellate District, Division Six, has reaffirmed that initiatives can only be used to enact statutes, not to compel future legislative action. In this decision (available here), the Court also held that the City Attorney had acted properly in seeking a judicial declaration that he had no duty to prepare ballot titles and summaries for two proposed (and clearly invalid) measures.

The two measures were clearly beyond the initiative power as construed in AFL-CIO v. Eu, 36 Cal. 3d 687 (1984), and Marblehead v. City of San Clemente, 226 Cal. App. 3d 1504 (1991). Of the two measures, one directed the local city council to “urgently consider and take measures” to deter or prohibit national chains or franchise operations within the city while the other ordered the city council to “urgently consider and take measures” to address affordable housing. However, neither measure enacted a statute. Accordingly, both were outside the initiative power which, under Article II, §8(a) of the California Constitution is limited to the adoption of “statutes.”

This decision breaks no new ground in its interpretation of the California Constitution. Indeed, the most mysterious thing about it is why the ACLU Foundation of Southern California decided to represent the proponent of the plainly invalid measures.

Court Holds That Domestic Violence Programs Can't Exclude Men

In an important decision, the Court of Appeal for the Third Appellate District has held in Woods v. Shewry (available here) that the State cannot constitutionally exclude men from domestic violence programs. The court held that the Equal Protection Clause of the California Constitution subjects gender-based classifications to strict scrutiny under Sail'er Inn, Inc. v. Kirby, 5 Cal. 3d 1 (1971), and that the State could not prove that excluding men from certain domestic violence programs was necessary to further a compelling state interest. However, the court expressly refrained from holding that men and women had to be provided equal services. Instead, acknowledging that women were more often victims of domestic violence than men, and suffered greater injuriies than men when they were, the court said that "it may be appropriate to provide more and different services to battered women and their children. For example, a program might offer shelter for women, but only hotel vouchers for a smaller number of men."

Many things are interesting about this case, both doctrinally and factually. As a factual matter, the record seems very thin. While there was evidence in the record about the state programs that plaintiffs were attacking, which were programs that provided grants to individual service providers, the court made no reference to evidence that might have been adduced from individual providers or recipients of services. For example, the record apparently showed that all the grantees of one state program offered gender-neutral services, as did 85% of the grantees of the other program. From this the court deduced that the state had no compelling interest in funding grantees who were not gender neutral. But it would have been interesting to know whether the 15% of grantees that provided services only to women were providing different services than the other grantees, services that might have benefitted from a female-only clientele.

Moreover, while the court "reformed" the domestic violence definitions to make them gender-neutral, it did not specifically require that all grantees serve both men and women. To take the example given by the court, a shelter could be reserved for women as long as men got something, too, such as a hotel voucher. Does this mean that an organization that only operated a shelter for battered women could not get state funding? Or is the Equal Protection Clause satisfied as long as another grantee in the same area provided hotel vouchers?

Doctrinally, too, the case raises more questions than it answers. For one thing, the opinion's equal protection analysis starts out by saying that no equal protection scrutiny is required unless the two groups disparately affected by a challenged statute "are sufficiently similar with respect to the purpose of the law in question that some level of scrutiny is required in order to determine whether the distinction is justified.” But then the court says, quite inconsistently, that because equal protection rights are individual, the fact that women experience violence more than men, and suffer greater injuries when violence occurs, is irrelevant to equal protection analysis. So strict scrutiny is required even though men and women are not similarly situated as victims of violence.

More broadly, the case assumes without much analysis that strict scrutiny applies to a grant program that provides government benefits rather than a statute that disadvantages a disfavored class. It's very much like saying that affirmative action should be treated the same as invidious racial discrimination. There are certainly federal cases in the area of race that approach this position, but does it accurately state California law? Stay tuned.

This case seems like a great candidate for Supreme Court review. I would be suprised if the decision doesn't stir up a big storm and if the California Supreme Court doesn't take it.

Court of Appeal Invalidates Extra Compensation for Los Angeles Judges

In a decision sure to raise at least a few judicial hackles, the Court of Appeal, Fourth Appellate District, Division One, has held that the County of Los Angeles may not give Superior Court judges in that county additional compensation over and above that provided by the Legislature. The decision in Sturgeon v. County of Los Angeles (available here) is based on Article VI, Section 19, which provides that the Legislature shall "prescribe compensation for judges of courts of record." Government Code Section 53200.3 authorized each county to provide to judges the same or similar benefits that it provides "to employees." Given the wide variety among county employees and their compensation, the Court held that this statute enbodied the sort of standardless discretion that violated the rule against delegation of authority set forth in cases like Kugler v. Yocum, 69 Cal. 2d 371 (1969). In reaching this conclusion, the court relied heavily on two prior attorney general opinions, the second of which had opined that the current version of Section 53200.3 was unconstitutional, as well as Martin v. County of Contra Costa, 8 Cal. App. 3d 856 (1971), which approved legislation that tied judicial compensation to that of "comparable" county employees.

This seems like an important issue that might well get reviewed by the California Supreme Court. On the other hand, it would be easy for the Legislature to fix the problem identified by the court--it need only pass a statute similar to the one upheld in Martin. Even if the statute were retroactive, it would not be a gift of public funds, for the reasons identified in the Sturgeon opinion.

Court of Appeal Upholds Taking Claim Under Californa Constitution

In Monk v. City of Rancho Palos Verdes (here), the Court of Appeal forthe Second Appellate District, Division One, has upheld a landowner's taking claim under the California Constitution. In doing so, the court reminded us that the Takings Clause of the California Constitution has a broader scope than its federal counterpart. Article I, Section 19 of the California Constitution provides: “Private property may be taken or damaged for public use only when just compensation . . . has first been paid to, or into the court for, the owner." In comparison, the Fifth Amendment of the federal Constitution states: “[N]or shall private property be taken for public use, without just compensation.”

Because the California Constitution requires compensation for damage as well as a taking, the court held that the California clause "protects a somewhat broader range of property values” than does the corresponding federal provision." However, aside from that difference, California courts have construed the clauses congruently. The Monk case did not involve the "damaged property" portion of the California Takings Clause, so the court relied on both federal and California authority.

On the merits the court held that plaintiff's property had been "taken" by a moratorium on development in a landslide area because it deprived the plaintiff of all economic use of his property. As a result the City had to show that developing plaintiff's property would cause "a reasonable probability of significant harm" that would justify that moratorium under nuisance law. The court held that the City had failed to make this showing where the record indicated merely that the stability of plaintiff's property was uncertain and there was no risk that development of plaintiff's property would cause harm to others.

Court of Appeal Holds Ban on Publishing Witness Testimony Unconstitutional

Who would have thought that a trial court could prohibit the publication of witness testimony by a single newspaper? An Orange County Superior Court thought so, but the Court of Appeal swiftly reversed the trial court's ruling, holding it an unconstitutional prior restraint, in Freedom Newspapers v. Superior Court (here). The Court's ruling reaffirms the important principle that the California Constitution gives more protection to free speech than the federal constitution. But since the trial court's order was plainly unconstitutional under both the federal and state constitutions, the court didn't have to spend much time on the provisions of the state's fundamental charter.

Los Angeles Times Opposes Propositions 5, 6 and 9

The Lost Angeles Times yesterday announced its opposition to three criminal justice initiatives: Proposition 5 (here), Proposition 6 (here) and Proposition 9 (here). The Times also published an op-ed piece today (here) on Proposition 11, the redistricting initiative.

Court of Appeal Limits Single-Subject Rule

In an interesting decision, the Court of Appeal, Second Appellate District, Division Eight, has decided that a city charter amendment placed on the ballot by the city council need not comply with the single-subject rule contained in Article II, Section 8(d). Hernandez v. County of Los Angeles, available here. By its terms, that provision applies only to initiatives, which the Constitution defines in Article II, Section 8(a) as "the power of the electors to propose statutes . . . and to adopt or reject them." A measure put on the ballot by the city council is not proposed by the electors through initiative petitions and thus is not an initiative within Article II, Section 8(c). Similarly, Article XI, Section 3 provides that a charter amendment "may be proposed by initiative or by the governing body," and thus also indicates that a charter amendment put on the ballot by a city council is not an initiative. This reading preserves the ability of city councils to put comprehensive charter amendments on the ballot in a single measure, rather than grouping provisions by subject.

This is an important decision, but it seems unquestionably right, given the language of the California Constitution. There should be no reason for the California Supreme Court to grant review.

New Poll Finds Proposition 8 Trailing And Slim Margins of Support for Propositions 4 and 11

A new poll by the Public Policy Institute of California (here) finds Proposition 8 (banning same-sex marriage) losing and slim majorities in favor of Propositions 4 (requiring parental consent for teenage abortions) and Proposition 11 (which would turn over legislative redistricting to a commission). The poll also shows that a majority of Californian favor reform of the budget process, which 49% supporting decreasing the two-thirds vote requirement to 55% and 60% supporting limits on state spending.

Proposition 4

The Los Angeles Times has an article yesterday (available here) on Proposition 4, the initiative constitutional amendment that would require parental consent for teenage abortions.

Governor To Use Budget Crisis To Push For Proposition 11

According to today's Sacramento Bee (here), the Governor plans to use the recently concluded budget crisis in campaigning for Proposition 11. Whether this will be any more successful than his prior attempts to amend the California Constitution remains to be seen.

Water Bond May Be Delayed Until 2010

As the San Francisco Chronicle explains in this article (here), the Governor wants to put a water bond measure on the California ballot. However, "[u]nder the state Constitution, the Legislature can place bond measures on the ballot only during a regularly scheduled statewide election. The next one is scheduled for June 2010. The governor's staff has indicated that Schwarzenegger would have to use the initiative process if he wants the water question to go before voters next year. To do so, he'll have to use his campaign committee to launch a petition drive and will have to get moving quickly."

More on the Budget Crisis

According to press accounts (such as the one here from the San Francisco Chronicle), the budget deal between the Legislature and the Governor involves (among other things) a "rainy day fund," that would be collected by the state and used only for specified purposes. Indeed, one of the final sticking points in the negotiations was the issue of when the "rainy day fund" could be used. Here's the constitutional issue: given that one legislative body generally can't bind its successors, how does a statute such as the annual Budget Act restrict the Legislature's future ability to tap into the "rainy day fund" for whatever purposes the Legislature then deems appropriate? Or does the deal creating the "rainy day fund" involve submitted a constitutional amendment to the electorate that would create the fund and establish the conditions under which it could be tapped?

Court Reaffirms Charter County Power Over Employee Compensation

In Dimon v. County of Los Angeles (available here), the Court of Appeal for the Second Appellate District, Division Four, held that Article XI, Section 4(f), which gives charter counties the right to control the "compensation" of their employees, exempts a charter county from having to comply with Industrial Welfare Commission regulations regarding meal breaks and failure to pay for missed breaks. The court relied on numerous prior cases, including County of Riverside v. Superior Court, 30 Cal. 4th 278 (2003), in which I represented the county. As a result the decision breaks no new ground; indeed, another Court of Appeal recently resolved a similar claim against the employees. See Curcini v. County of Alameda, 164 Cal. App. 4th 629 (2008). Both cases hold that the "compensation" protected by the constitution against state legislative or regulatory interference includes more than just salaries. The Dimon court also held that (1) the reference to "ordinance" in Article XI, Section 4(f) does not require a charter county to set employee salaries by ordinance, not resolution; and (2) the meal break regulation does not involve a matter of statewide concern.

Because the decision represents only a minimal advance over prior law, if that, it seems unlikely that the Supreme Court would grant a petition for review.

Jury Trial Waivers

In Grafton Partners v. Su0perior Court, 35 Cal. 4th 944 (2005), the Court held that a predispute jury trial waiver violated Article I, Section 16 of the California Constitution. That constitutional provision provides, among other things, that the right to a jury trial may only be "waived by consent of the parties expressed as prescribed by statute." Because the Legislature has never authorized predispute jury trial waivers, they are unconstitutional and thus unenforceable. (Howard Rice represented the Petitioners in that case.)

The Court of Appeal, Fourth Appellate District. Division One, has now decided that a provision authorizing judicial reference in CC&Rs promulgated by a developer is also unconstitutional and unenforceable. Treo @ Kettner Homeowners Ass'n v. Superior Court, available here. The developer of a condominium project recorded CC&Rs for the project, which contained a provision mandating judicial reference for any disputes between the developer and the condo owners or their association. When a construction defects dispute arose, the developer moved for judicial reference, the trial court granted the order, and the plaintiff sought a writ of mandate from the Court of Appeal.

Section 638 provides the a referee may be appointed "upon the motion of a party to a written contract or lease that provides that any controversy arising therefore shall be heard by a referee if the court finds that a reference agreement exists between the parties." The court acknowledged that CC&Rs are enforceable under some circumstances, but held that they were not the sort of "contract" that the Legislature intended to authorize in Section 638.

CC&Rs are generally entered into between a developer and a homeowners' association that the developer forms. As a result, as the court stressed, the homeowners who ultimately buy into the development do not assent to the CC&Rs, but merely acquire property with legal notice thereof. The court therefore found that the CC&Rs were not the sort of "contract" that could waive a jury by authorizing judicial reference: "Treating CC&R's as a contract such that they are sufficient to waive the right to trial by jury does not comport with the importance of the right waived. CC&R's are notoriously lengthy, are adhesive in nature, are written by developers perhaps years before many owners buy, and often, as here with regard to the waiver of trial by jury, cannot be modified by the association. Further, the document is not signed by the parties."

Assuming that this decision survives the inevitable petition for review, the question this leaves open is whether judicial reference agreements are enforceable if they are contained in adhesion contracts that, in contrast to CC&Rs, are signed by the parties. That will be an interesting battle.

Proposition 11 and the Budget Stalemate

Would passage of Proposition 11 make the Legislature less partisan and less prone to budget stalemates? A new study by the Public Policy Institute of California says no, in a report available here, but the Sacramento Bee's Dan Walters disagrees (here). (Thanks to Rick Hasen's Election Law Blog for linking to the Dan Walters article.)

Court of Appeal Upholds Mobile Advertising Ban

in a 2-1 decision, the Court of Appeal, Second Appellate District, has upheld the City of West Hollywood's ban on "mobile commercial advertising." Showing Animals Respect and Kindness v. City of West Hollywood, available here. The challenged ordinance defined "mobile commercial advertising" as "any vehicle, or wheeled conveyance which carries, conveys, pulls or transports any sign or billboard for the primary purpose of advertising." However, the ordinance exempted buses, taxicabs, and any vehicle which displayed advertising or business identification of the owner, as long as the vehicle was engaged in the owner's normal business.

In an opinion by Justice Rothschild, the majority held that the ordinance applied to both commercial and non-commercial speech, that it was content-neutral, that it served significant governmental interests in promoting traffic safety, reducing air pollution and improving the city's aesthetic appearance of the city, and that it left the plaintiff--an animal rights group--ample alternative means of communication. In contrast, Justice Mallano's dissent argued that the ordinance should be interpreted as applying only to commercial speech, which would have rendered it inapplicable to plaintiff. He asserted, unlike the majority, that "the First Amendment protects the right of a vehicle owner to drive on public streets for the primary purpose of conveying a noncommercial message that appears on the vehicle."

Although the plaintiff contended that the ordinance violated both the federal and the state constitution, both the majority opinion and the dissent focused exclusively on the federal constitution. Neither addresses whether the state constitution might provide greater protection in this context than its federal counterpart.

Although there are lots of cases addressing the First Amendment implications of billboard advertising, this may be the first case involving an almost total ban on advertising placed on vehicles. None of the cases cited by either the majority or the dissent involves a local ordinance similar to the West Hollywood one. That may make the case review-worthy, particularly if the plaintiff can show that other cities have similar laws.

The Budget Crisis and the California Constitution

The Bay Area Council isn't the only group thinking about reforming the California Constitution. Here's a paper by David S. Gamage, to be published in a forthcoming book on Proposition 13, that analyzes the reasons for California's recurring budget crises and proposes some solutions, such as doing away with the two-thirds requirement to pass a budget, requiring that initiatives be revenue-neutral or self-funding (take that, Howard Jarvis Taxpayers Association!) and putting the state's revenue from the income tax on capital gains into a "rainy-day fund." It will be interesting to see if the political will to adopt these changes--or any other changes--results from the current budget stalemate, now in its third month.

Bay Area Council Calls For Constitutional Convention

Spurred by the ongoing budget stalemate, the Bay Area Council has called for a constitutional convention to revise the California Constitution. Its opinion can be accessed here. We'll keep you posted.

Supreme Court Rejects "Free Exercise" Defense To Unruh Act Claim

On August 18, 2008, the California Supreme Court decided North Coast Women's Care Medical Group, Inc. v. Superior Court (here), holding that neither the federal nor the California Constitution exempts a medical clinic's physicians from complying with the Unruh Act's prohibition against discrimination based on a patient's sexual orientation. With respect to the federal constitution, the Court held that (1) the federal constitution's "free exercise" clause did not provide a religious exemption to generally applicable regulatory laws that are neutral with respect to religion; and (2) the Unruh's Act's non-discrimination requirement did not violate the doctors' free speech rights. With respect to the state constitution, the Court held that the "free exercise/liberty of conscience" provision embodied in Article I, Section 4 did not give physicians a constitutional defense against the plaintiff's Unruh Act claim. Notably, the Court did not decide whether claims under this provision must be evaluated using the deferential federal standard set forth in Employment Division v. Smith, 494 U.S. 872 (1990), which holds that the federal constitution's "free exercise" clause does not create an exemption to neutral laws of general applicability, or instead must satisfy a more stringent standard such as "strict scrutiny." The Court avoided this issue by holding that the state constitution's free exercise clause did not provide an affirmative defense even if "strict scrutiny" applied, because the Unruh Act serves the State's compelling interest in preventing discrmination and there are no less restrictive means to achieve that goal.