CITY OF BELL, Pеtitioner, v. THE SUPERIOR COURT OF LOS ANGELES COUNTY, Respondent; ROBERT A. RIZZO, Real Party in Interest.
No. B247362
Second Dist., Div. Three
Oct. 4, 2013
219 Cal. App. 4th 236
Aleshire & Wynder, David J. Aleshire, Anthony R. Taylor and Michael C. Huston for Petitioner.
No appearance for Respondent.
Spertus, Landes & Umhofer and James W. Spertus for Real Party in Interest.
CROSKEY, J.----Robert A. Rizzo, the former chief administrative officer of the City of Bell (City), has been sued by the City, as well as the Attorney General acting on behalf of the City, for restitution for his alleged looting of the City‘s coffers. He has also been criminally charged with multiple counts of misappropriation of public funds. Rizzo, by complaint for declaratory relief, seeks a judgment that the City is contractually obligated to provide him with a defense to these civil and criminal actions. We conclude that, as a matter of law, the City does not owe Rizzo such a defense.1
FACTUAL AND PROCEDURAL BACKGROUND
1. Underlying Factual Allegations
The City is a charter city with a population of 38,250. It was discovered that Rizzo, as well as the assistant chief administrative officer and five city council members, were receiving salaries well in excess of the amounts paid to similar individuals in similarly sized cities and that these seven individuals went to great lengths to conceal their salaries from public knowledge. (People ex rel. Harris v. Rizzo (2013) 214 Cal.App.4th 921, 928 [154 Cal.Rptr.3d 443].) The receipt and approval of excessive salaries are not, by any means, the only acts of wrongdoing alleged against Rizzo and the other individuals. A criminal complaint against Rizzo charges multiple counts of misappropriation of public funds (
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2. The Underlying Actions
There are five actions for which Rizzo seeks the City to pay his defense costs. We briefly discuss each action.
As we shall discuss, Rizzo tendered the AG‘s action to the City for a defense. The City refused, which resulted in Rizzo filing a cross-complaint against the City, seeking a declaration that the City must defend and indemnify him against the Attorney General‘s action. This cross-complaint, in turn, prompted the City, on November 24, 2010, to bring its own cross-complaint against Rizzo. We call this “the City‘s action.” The City alleged causes of action against Rizzo for intentional misrepresentation, constructive fraud, breach of fiduciary duty, negligence, conflict of interest, declaratory relief, and unjust enrichment.
In addition to the two civil actions, Rizzo faces two criminal complaints and one indictment. The first complaint, filed September 20, 2010, charged 44 counts of misappropriation of public funds5 (
3. Rizzo‘s Tender of the Actions for a Defense Is Denied
Shortly after the AG‘s action, the City‘s action, and the criminal complaints were filed, Rizzo tendered them to the City for a defense.8 Rizzo relied on a term in his employment contract with the City, as well as statutory provisions which govern the defense of public entity employees by their public entity employers.9
We first set forth the language of the defense obligation in Rizzo‘s employment contract. It is part of an indemnification clause,10 which states as follows:
“City shall defend, hold harmless and indemnify Employee against any claim, demand, judgment or action, of any type or kind, arising out of any act or failure to act, by Employee, if such act or failure to act was within the course and scope of Employee‘s employment. City may compromise and settle any such claim or suit provided City shall bear the entire cost of any such settlement.”
Under
4. Rizzo Seeks Declaratory Relief
As noted above, Rizzo filed a cross-complaint against the City (in the AG‘s action) alleging three causes of action for declaratory relief, each seeking provision of a defense and indemnity. The first cause of action relied on Rizzo‘s employment contract; the second relied on
Rizzo‘s complaint was filed prior to the City‘s action being filed against Rizzo. It was also filed before the third criminal action and possibly the second. As such, Rizzo‘s complaint did not seek a defense for those actions. There is no indication in the record before us that Rizzo ever amended or supplemented his complaint to seek a defense of those actions. However, both parties proceeded as though thesе actions are encompassed by Rizzo‘s complaint.
5. The Proceedings Leading to the City‘s Writ Petition
The procedural history leading to the instant writ petition is somewhat convoluted. At one point, the City attempted to take Rizzo‘s deposition, but Rizzo asserted his Fifth Amendment privilege and refused to answer all questions put to him concerning relevant events. As a result, in January 2012, the City sought a stay of Rizzo‘s claims against it, pending such time as he could meaningfully participate in discovery. Rizzo did not oppose a stay----except he sought to pursue that part of his cause of action based on his employment contract which sought a declaration that the City must provide him with a defense. Rizzo argued that he was entitled to an immediate
On April 30, 2012, the court ordered that both Rizzo‘s action against the City and the City‘s action against Rizzo be stayed pending further order of the court.11 However, the court did not stay Rizzo‘s partial cause of action against the City for a defense pursuant to his employment contract. In its order, the court anаlyzed the language of Rizzo‘s employment contract and controlling law and concluded that the City was required “to defend Rizzo from the time he tenders the defense of a claim arising out of any act or failure to act,” regardless of whether the act or failure to act was within the course and scope of his employment.
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The court‘s order indicated that the parties could “stipulate that the court‘s construction of ... Rizzo‘s contract would be unchanged by a trial ....” Otherwise, the court would set a trial date on Rizzo‘s partial cause of action for a declaration that the City was required by its employment contract to provide him with a defense.12
On May 16, 2012, the City demanded a jury trial. On September 5, 2012, Rizzo moved to strike the City‘s demand for a jury trial. Rizzo argued that the sole issue for trial was interpretation of his employment contract, which presented an issue of law for the court. The City responded that numerous factual issues existed, including issues relating to whether the contract was ambiguous and issues relating to its affirmative defenses. The trial court, however, agreed with Rizzo and, on January 31, 2013, ordered the City‘s jury trial demand stricken.
6. The City‘s Writ Petition and the Issues Raised
On Mаrch 8, 2013, the City filed its petition for writ of mandate, challenging the trial court‘s order striking its jury trial demand. We issued a temporary stay and sought preliminary opposition. In the City‘s reply to Rizzo‘s opposition, the City argued that interpreting Rizzo‘s employment contract to require the City to provide a defense would render the contract void as against public policy. In other words, the City raised the issue that the employment contract should be interpreted, as a matter of law, not to require the City to provide a defense to the actions. Rizzo immediately filed a motion
On May 8, 2013, we extended the stay order and issued an order to show cause. We asked the parties to brief seven enumerated issues, specifically including: (1) “Does Rizzo‘s employment contract obligate the [City] to provide indemnity to Rizzo against: [¶] (a) Criminal charges involving allegations in which the City and/or the citizens thereof were victims? [¶] (b) Civil actions alleging that Rizzo engaged in ultra vires acts and/or the waste or misuse of funds belonging to the City and/or the citizens thereof?” and (2) “If there is no obligation to provide indemnity for such claims under the terms of Rizzo‘s employment contract, on what rationale and authority would the City be obligated to provide a defense to such claims?” The parties briefed the issues as requested.
As this court continued its review of the applicable law, we sought further briefing on additional issues, including (1) whether the indemnity clause in Rizzo‘s employment contact was “a routine third-party indemnity clause which does not extend to first-party claims in the absence of clear and explicit language to that effect“; (2) whether the clause was “reasonably subject to the interpretation that the City intended to pay for the defense of any action brought by the City, or on its behalf, against Rizzo“; and (3) whether ”
ISSUES PRESENTED
We first consider the terms of Rizzo‘s employment agrеement and conclude that the clause on which he relies is simply a third party indemnification agreement, which does not apply to civil actions, by or on behalf of,
Rizzo argues that we should not reach these issues. He takes the position that if the employment contract is to be interpreted as a matter of law, the trial court was correct in striking the City‘s request for a jury trial, and we should simply deny the writ petition and let the trial court interpret the contract in the first instance. Such a course of action would, in our view, be a waste of judicial resources. The contract can be interpreted as a matter of law; the parties have been given a full opportunity to brief the issues before this court; and it appears, from the trial court‘s ruling on the stay motion, that the trial court‘s present interpretation of the contract is erroneous.
We will conclude that the contract does not require the City to provide Rizzo with a defense to the underlying actions. We will therefore grant the City‘s writ petition and direct that the trial court conduct no trial, bench or jury, on Rizzo‘s partial cause of action for a defense under his employment contract, as the City is entitled to judgment on that claim as a matter of law.
DISCUSSION
1. Interpreting the Language of the Agreement Itself
a. Standard of Review
The interpretation of a written instrument, even though it involves what might properly be called questions of fact, is essentially a judicial function to be exercised according to the generally accepted canons of interpretation so that the purposes of the instrument may be given effect. (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865 [44 Cal.Rptr. 767, 402 P.2d 839].) Since indemnity agreements are construed under the same rules which govern the interpretation of other contracts, the indemnity agreement must be interprеted so as to give effect to the mutual intention of the parties. (Myers Building Industries, Ltd. v. Interface Technology, Inc. (1993) 13 Cal.App.4th 949, 969 [17 Cal.Rptr.2d 242];
When a dispute regarding the meaning of a contractual provision exists, the court must first determine whether on its face the language is capable of differing or inconsistent reasonable interpretations. (Southern Cal. Edison Co. v. Superior Court (1995) 37 Cal.App.4th 839, 848 [44 Cal.Rptr.2d 227].) The test “is not whether [the instrument] appears to the court to be plain and unambiguous on its face, but whether the offered evidence is relevant to prove a meaning to which the language of the instrument is reasonably susceptible.” (Pacific Gas & E. Co. v. G. W. Thomas Drayage etc. Co. (1968) 69 Cal.2d 33, 37 [69 Cal.Rptr. 561, 442 P.2d 641]; see Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 955 [135 Cal.Rptr.2d 505].) Accordingly, if the instrument is reasonably susceptible to the interpretation urged, the court must receive any relevant extrinsic evidence the party puts forth to prove its interpretation. (Wolf v. Walt Disney Pictures & Television (2008) 162 Cal.App.4th 1107, 1126 [76 Cal.Rptr.3d 585].) If there is no material conflict in the extrinsic evidence, the trial court must interpret the contract as a matter of law. Otherwise, it is a factual conflict dependent on the credibility of extrinsic evidence to be properly resolved by the jury. (Ibid.)
In this case, Rizzo is correct when he argues that there are no factual issues to resolve. The dispute over the interpretation of the employment contract between the City and Rizzo is entirely one of law. Our standard of review is therefore de novo.
b. Noninsurance Indemnity Contracts
In Crawford v. Weather Shield Mfg., Inc. (2008) 44 Cal.4th 541, 552 [79 Cal.Rptr.3d 721, 187 P.3d 424] (Crawford), the California Supreme Court articulated the appropriate standard of review for the interpretation of noninsurance indemnity agreements: “subject to public policy and established rules of contract interpretation, the parties have great freedom to allocate such responsibilities as they see fit.... [¶] []Though indemnity agreements resemble liability insurance policies, rules for interpreting the two classes of
c. Duty to Defend in Indemnity Agreements
We now turn to the issue of the scope of the duty to defend in indemnity agreements, and, specifically, its relation to the scope of the duty to indemnify. In the absence of a contrary intention in the language used, the law will imply, in an agreement to indemnify, an agreement to defend actions brought against the indemnitee “in respect to the matters embraced by the indemnity.” (
However, sometimes it will not be clear whether an action brought against the indemnitee is within the scope of the indemnity until after the underlying action has been resolved. In those situations, the duty to defend nonetheless arises. That is to say, the law implies in every indemnity contract, unless the contract provides to the contrary, the duty to defend claims which, at the time of tender, allege facts that would give rise to a claim of indemnity. (Crawford, supra, 44 Cal.4th at p. 558.)
This rule of law presumes that there is no language to the contrary. The parties are free to agree to a broader duty to defend; that is, the parties can agree that a defense will be provided even in situations where the facts alleged would not give rise to a claim of indemnity.15 The parties may also
d. Indemnity Agreements Are Generally Not Exculpatory
As we noted above, in a noninsurance indemnity agreement, in contrast to an insurance agreement, the indemnitee may often have the superior bargaining power, and as a result, public policy concerns influence how such agreements are construed. As such, if a party seeks, in a noninsurance agreement, to be indemnified for protections beyond those afforded by the doctrines of implied or equitable indemnity----for his or her own active negligence, or regardless of the indemnitor‘s fault----the language on the point must be particularly clear and explicit and will be construed strictly against the indemnitee. (Crawford, supra, 44 Cal.4th at p. 552.)
This rule applies when the indemnitee seeks to be indemnified for claims made by the other party to the contract----the indemnitor----itself. “A clause which contains the words ‘indemnify’ and ‘hold harmless’ is an indemnity clause which generally obligates the indemnitor to reimburse the indemnitee for any damages the indemnitee becomes obligated to pay third persons. [Citation.] Indemnification agreements ordinarily relate to third party claims.” (Myers Building Industries, Ltd. v. Interface Technology, Inc., supra, 13 Cal.App.4th at p. 969.) “An indemnity agreement may provide for indemnification against an indemnitee‘s own negligence, but such an agreement must be clear and explicit and is strictly construed against the indemnitee.” (Rooz v. Kimmel (1997) 55 Cal.App.4th 573, 583 [64 Cal.Rptr.2d 177].)
Cases which have interpreted an indemnification agreement to act as an exculpatory clause between the parties to the agreement have involved agreements which contain language clearly providing that the indemnification clause applied to such claims. (E.g., Rooz v. Kimmel, supra, 55 Cal.App.4th at p. 586 [indemnification clause provided that indemnitee had been requested to act as an accommodation and without consideration; indemnitor agreed to protect indemnitee against “‘all liabilities ... which may be sustained or incurred by [indemnitee] under, or arising directly or indirectly out of ‘” the acts it had been requested to perform].) Putting it another way, as one court explained, “If [the] parties go out of their way and say ‘we really, really mean it,’ language clearly contemplating exculpation may be enforced.” (Queen
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In Queen Villas, a management company attempted to rely on an indemnity clause in its agreement with a homeowners association to defeat an action by the association alleging the management company had breached the agreement.16 The indemnification clause simply provided that the association would indemnify the management company “‘against any and all claims, costs, suits, and damages ... arising out of the performance of this agreement or in connection with the management and operation of the [a]ssociation....‘” (Queen Villas, supra, 149 Cal.App.4th at p. 4.) The court noted that the management company “seeks to conscript the indemnification agreement in this case into a direct, two-party exculpatory clause” (id. at p. 5) and rejected the attempt. The court found no language in the terms of the contract indicating an intent for the indemnification clause to go “beyond the usual context of third party indemnification.” (Id. at p. 7.) The court further noted “the reductio ad absurdum of the ... management company‘s position vis-à-vis thе association‘s contract claims .... Under the ... management company‘s interpretation, it could just outright plain fail to do any work at all for the association, such as hiring a gardening company or arranging for insurance or the typical things that property managers do, and the clause would protect it even from a breach of contract action by the association for having paid for services never performed.” (Id. at p. 8.)
e. The Instant Indemnification Agreement
We now turn to the terms of the instant agreement and first consider whether the duty to defend is dependent upon the scope of the duty to indemnify. The duty to defend and the duty to indemnify are not only discussed in precisely the same terms, they are part of the same sentence. We repeat the language: “City shall defend, hold harmless and indemnify Employee against any claim, demand, judgment or action, of any type or kind, arising out of any act or failure to act, by Employee, if such act or failure to act was within the course and scope of Employee‘s employment. City may compromise and settle any such claim or suit provided City shall bear the entire cost of any such settlement.” There is no defense obligation beyond the indemnity obligation; thus, there is no duty for the City to defend any claims which do not, at the time of tender, allege facts which would, at least potentially, fall within the scope of the duty to indemnify.
Rizzo would separate the defense and indemnity provisions and argue that, regardless of the scope of the City‘s obligation to indemnify (which will be
Thus, it is critical to determine the scope of the indemnity obligation. Specifically, as Rizzo seeks defense of the City‘s action and the AG‘s action on behalf of the City, we must determine whether the indemnity clause can reasonably be interpreted to include claims made by the City or on its behalf. We believe that the question must be answered in the negative.
As we have discussed, indemnity agreements generally apply only to third party claims. In order for an indemnity agreement to encompass claims between the parties to the agreement, and to act as an exculpatory clause or release, there must be clear and explicit language to that effect. No such language is present in the agreement before us. Indeed, there is language indicating a contrary intent. The final sentence of the indemnification clause gives the City the right to compromise and settle “any such claim or suit” (that is, a claim or suit within the scope of the indemnity agreement) provided it bears the cost of the settlement. Such language can only be read to apply to claims or suits by third parties. The idea that the City “may compromise and settle” a suit brought by the City against Rizzo, if it pays itself the settlement amount, would make no sense whatever. The language of this clause is that of a third party indemnity only. It is not reasonably susceptible of аn interpretation that it also releases Rizzo from any liability to the City itself.
As the indemnity agreement does not apply to first party claims, the defense obligation cannot extend to such claims either. The City is only obligated to defend actions which allege facts which could potentially give rise to a claim of indemnity. As both the City‘s action and the AG‘s action
We believe the same conclusion applies to the issue of whether a defense is owed for the criminal actions. The language of the indemnity clause clearly applies to third party civil actions, not criminal complaints and indictments. We again note the provision allowing the City to settle the actions on behalf of Rizzo, as long as it pays the settlement. This provision demonstrates that criminal actions were not contemplated by the agreement; Rizzo could not agree to allow City to enter into a plea bargain on his behalf, nor could the City agree to serve a sentence on Rizzo‘s behalf. As the indemnification clause, as a factual matter, did not extend to criminal actions, the defense obligation could not do so either. However, there is a more fundamental reason why the City owes Rizzo no duty to defend the criminal actions: it is statutorily prohibited from doing so.
2. Government Code Limitations on Provision of a Defense
The Government Code contains various provisions relating to a public entity‘s obligation to provide its employees, or former employees, with a defense to actions arising out of acts taken in the course and scope of their employment.20 These provisions are all found in California‘s Tort Claims Act (now known as the Government Claims Act), which was enacted in 1963 “in order to provide a comprehensive codification of the law of governmental liability and immunity.” (Los Angeles Police Protective League v. City of Los Angeles, supra, 27 Cal.App.4th at p. 174.) At issue in the instant writ petition is whether, and to what extent, a public entity and its employee are free to contract around these provisions in order to give the employee greater defense rights. Rizzo concedes that, with respect to the criminal actions, there is no statutory duty for the City to provide him with a defense. We therefore
a. Relevant Provisions of the Tort Claims Act
As to the obligation to defend a civil action, there is a general provision, followed by two exceptions. The general provision provides, “Except as otherwise provided in Sections 995.2 and 995.4, upon request of [a public employee], a public entity shall provide for the defense of any civil action or proceeding brought against him, in his official or individual capacity or both....” (
As already noted,
It is important to recognize that the language of each of these statutory exceptions is permissive. That is to say, the provisions of
The language set forth above is to be contrasted with the language of
b. Government Code Section 996.6 Does Not Permit a Public Entity to Provide Greater Defense Rights to a Public Employee Facing Criminal Prosecution
Rizzo argues that an additional provision,
There is little law interpreting this provision, although dicta in Los Angeles Police Protective League v. City of Los Angeles, supra, 27 Cal.App.4th 168, supports Rizzo‘s interpretation. That language states, “public entities and employees can voluntarily agree to change the indemnity structure of the Tort Claims Act by collective bargaining.
The key language in
(1) Statutory Analysis
“Our primary duty when interpreting a statute is to ‘determine and effectuate’ the Legislature‘s intent. [Citation.] To that end, our first task is to examine the words of the statute, giving them a commonsense meaning. [Citation.] If the language is clear and unambiguous, the inquiry ends. [Citation.] However, a statute‘s language must be construed in context, and provisions relating to the same subject matter must be harmonized to the extent possible. [Citation.]” (Van Horn v. Watson (2008) 45 Cal.4th 322, 326 [86 Cal.Rptr.3d 350, 197 P.3d 164], fn. omitted.) A “‘[l]iteral construction should not prevail if it is contrary to the legislative intent apparent in the statute. The intent prevails over the letter, and the letter will, if possible, be so read as to conform to the spirit of the act.’ [Citation.]” (Id. at p. 327.) Moreover, we avoid interpretations which would render other statutes unnecessary surplusage. (Id. at p. 333.)
It is clear that Rizzo‘s interpretation would read the bulk of
(2) Legislative History
We are fortunate in that the legislative history of the key language in
Prior to the enactment of the comprehensive Tort Claims Act, the predecessor statute to
In 1963, the California Law Revision Commission issued its recommendations, which would later provide the basis for the Tort Claims Act. The Law Revision Commission stated, “The recommended legislation should be in addition to and not in lieu of any rights the public employee may have under any contract [(footnote citing to 39 Ops.Cal.Atty.Gen. 71 (1962))] or under any other law, charter, ordinance or regulation providing for his defense.” (Recommendation Relating to Sovereign Immunity, Defense of Public Employees (Jan. 1963) 4 Cal. Law Revision Com. Rep. (1963) p. 1309.) Clearly, then, the addition of the word “contract” to the language then existing in Government Code former section 2001 was due to the cited Attorney General opinion.
That opinion involved a police officer, who had, at his own expense, purchased a false arrest insurance policy and was seeking a defense from his employing entity. (39 Ops.Cal.Atty.Gen. 71, 71 (1962).) The question presented was whether the entity could avoid paying the defense costs on the theory that its employee already had an insurance policy which would provide a defense. The Attorney General rejected the argument, stating, “To permit the public entity to avoid a statutory duty by relying upon the contractual duty owed by a third party would be akin to the creation of a novation without the necessary consent or agreement of the obligee to release the additional obligor [citation]. It is concluded, therefore, that the terms of the insurance contract relative to the insurer‘s duty to defend have no bearing upon the statutory duty of the public entity which upon request of the employee is responsible for providing a legal defense at public expense
Thus, the addition of the word “contract” in what is now
This interpretation is consistent with the legislative history of
We therefore conclude that
3. Public Policy Supports Our Conclusions
While we base our opinion on the language of the contract and controlling law, it is also important to not lose sight of the policy issues implicated. Rizzo is alleged to have “embezzled, stole[n], and misappropriated millions of dollars in City funds” over a period of 17 years.24 When the City sought restitutionary relief for such losses, by means of civil actions brought by itself and the Attorney General on its behalf, and the district attorney initiated criminal prosecutions, Rizzo‘s response was to demand that the City defend him against the allegations in all such actions. This is not a case in which the public entity has chosen to stand behind its employee, perhaps wrongly accused by third parties. Instead, the entity has brought the accusations itself and (when asked to provide a defense) has made a specific finding that its employee acted out of fraud, corruption, or malice.
Under these circumstances, we find it difficult to believe that any expenditure of City funds to defend Rizzo would not constitute an impermissible waste of public funds. In this regard, we are guided by Tenwolde v. County of San Diego (1993) 14 Cal.App.4th 1083 [17 Cal.Rptr.2d 789]. That case concerned a lieutenant in the sheriff‘s public affairs division, who, at the request of the sheriff, distributed to the public materials which took a position on a political matter. A suit was brought to enjoin the practice, and the sheriff agreed to stop the distribution. Thereafter, both the sheriff and the lieutenant were held liable for the plaintiff‘s costs and attorneys fees in the underlying action. The lieutenant sought reimbursement from the county for those funds.
On appeal, the judgment was reversed. The court noted that while the county might be liable to indemnify the lieutenant if he had been held liable to a third party injured by his lobbying activities, the instant situation was different. “This was not a case of injury to a third party. It was, instead, an action to block illegal activities by a public agency. The injury resulting from the illegal activity was an injury to the public itself. The title to the article here under discussion is ‘Indemnification of Public Employees.’ [Citation.] While the text of the statutes in question does not use the word ‘indemnification,’ it is clear that this is the principle with which we deal. Granted, these indemnification provisions are statutory, and hence common law concepts are not necessarily applicable. However, indemnification is typically a tripartite concept, resting upon equitable principles. Ordinarily, it is the right of one who has satisfied another‘s debt to a third party to recover from the principal obligor. [Citation.] It makes no sense to talk about indemnification of a claim upon an indemnitee when the claim arises from damage by the indemnitee to the indemnitor. Here the wrong giving rise to the expenditure of fees and costs was an illegal expenditure of County funds----a tort by the sheriff‘s lieutenant against his own employer. When the party committing the wrong is stopped, and then assessed costs and fees, it would not be logical, and certainly would not accord with equitable principles, to require the wronged party, the County, to reimburse the employee.” (Tenwolde v. County of San Diego, supra, 14 Cal.App.4th at p. 1092.)
The court went on to note that, although the plaintiff in the underlying action had been a private party, the Attorney General could have brought the underlying action instead, in its capacity as the “public entity generally authorized to enforce [the] laws of the state.” (Tenwolde v. County of San Diego, supra, 14 Cal.App.4th at p. 1093.) “[H]ad the action been brought by the Attorney General, with the resulting halt in the sheriff‘s political activities, and had thereafter costs been assessed against [the lieutenant], would there have been any question about the denial of reimbursement of those costs from the very entity sought to be protected by the lawsuit? We think not.” (Ibid.) The award was for the benefit of the county and its citizens. “When, then, a cost award including fees based on the ‘private attorney general doctrine’ is made, it would turn the objective of the suit on its head to require indemnification of the judgment by the very governmental agency the suit sought to benefit.” (Id. at p. 1094.)
We recognize that Tenwolde is distinguishable, in that it pеrtained to indemnification rather than defense costs, and was specifically concerned
Public policy necessarily rejects the concept that a public entity allegedly victimized by a corrupt employee must provide that employee with a defense to those charges. The Tort Claims Act does not require such a result. A contract term intended only to provide the employee with indemnification from, and a defense to, third party actions cannot be interpreted to require that result. Moreover, to the extent that we are concerned with the provision of a defense to criminal аctions, a contract could not require that result, even if the parties had intended it.
DISPOSITION
The petition is granted. The matter is remanded to the trial court with directions to conduct further proceedings consistent with this opinion. Costs shall be awarded to the City in these writ proceedings.
Klein, P. J., and Aldrich, J., concurred.
A petition for a rehearing was denied October 25, 2013, and on October 9, 2013, and October 25, 2013, the opinion was modified to read as printed above. The petition of real party in interest for review by the Supreme Court was denied January 21, 2014, S214579.