Adam LAZAR, Plaintiff and Appellant,
v.
HERTZ CORPORATION et al., Defendants and Respondents.
Court of Appeal, First District, Division Four.
*371 Milberg, Weiss, Bershad, Hynes & Lerach LLP, William S. Lerach, Alan M. Mansfield, William S. Dato, Frank J. Janecek, Jr., San Diego, Sheri Pym; Bushnell, Caplan & Fielding LLP, and Alan M. Caplan, for Plaintiff and Appellant.
Downey, Brand, Seymour & Rohwer LLP, Steven P. Saxton, Teresa L. Zuber, Janlynn R. Fleener, Sacramento, and Tracy K. Hunckler, for Defendants and Respondents Hertz Corporation and Budget Rent a Car Corporation.
Heller, Ehrman, White & McAuliffe, Robert E. Borton and Thomas E. McKeever, San Francisco, for Defendants and Respondents National Car Rental System, Inc., and Alamo Rent-A-Car, Inc.
REARDON, J.
Adam Lazar filed a class action complaint for damages and injunctive relief against four rental car companies alleging that they refused to rent automobiles to persons under age 25 or unreasonably restricted such rentals. After all of the alleged causes of action were adjudicated against Lazar, the trial court entered judgment in favor of defendants. In these consolidated appeals, Lazar argues, inter alia, that the trial court erred (1) in finding that a refusal to rent to drivers under age 25 is permitted by section 1936 of the Civil Code[1] and (2) by finding the imposition of age-based surcharges on drivers under age 25 was not unreasonably high or unlawfully discriminatory as a matter of law. We affirm the judgment.
I. FACTS
In May 1995, appellant Adam Lazar filed a class action complaint seeking damages and injunctive relief against the Hertz Corporation, Budget Rent a Car Corporation, National Car Rental Systems, Inc. and Alamo Rent-A-Car, Inc.[2] On his own behalf and on behalf of other persons ages 16 through 25, Lazar pled causes of action for age discrimination in violation of the Unruh Civil Rights Act (Unruh Act); unlawful, fraudulent and unfair business practices; and unfair and fraudulent advertising. (See Bus. & Prof. Code, §§ 17200-17208, 17500-17509; § 51.) He sought damages and an injunction prohibiting the car rental agencies from refusing to *372 rent automobiles to licensed drivers under age 25. In May 1996, Lazar added a cause of action for false and misleading advertising.
In October 1996, the trial court sustained Hertz's demurrer to four of the seven causes of action without leave to amend. It overruled the demurrer on the other three causes of actionallegations of unfair business practices by Budget and Alamo against the general public and against Lazar and those drivers ages 16 to 25 who were charged a surcharge because of their age, as well as a cause of action for false and misleading advertising by all four companies.
In August 1997, Lazar moved for and obtained a dismissal without prejudice of two causes of action, leaving only the allegation of unfair business practices by Budget and Alamo against Lazar and those younger drivers who were charged a surcharge because of their age. The trial court granted the motion for summary adjudication filed by Budget and Alamo on the last cause of action.
II. REFUSAL TO RENT
A. Standard of ReviewDemurrer
First, Lazar contends that the trial court erred in finding that Hertz's refusal to rent to drivers under age 25 is permitted by section 1936. This constitutes a challenge to the trial court's decision to sustain Hertz's demurrer to his first three causes of action without leave to amend. The parties disagree about the standard of review to be applied in this matter. In every appeal, the threshold matter to be determined is the proper standard of reviewthe prism through which we view the issues presented to us. (See Clothesrigger, Inc. v. GTE Corp. (1987)
"A demurrer tests the legal sufficiency of the complaint...." (Hernandez v. City of Pomona (1996)
While the decision to sustain or overrule a demurrer is a legal ruling subject to de novo review on appeal, the granting of leave to amend involves an exercise of the trial court's discretion. (Hernandez v. City of Pomona, supra,
B. Unruch Act
The trial court sustained without leave to amend Hertz's demurrer to Lazar's refusal to rent cause of action alleging a violation of the Unruh Act. (See § 51.) It concluded that section 1936 permitted vehicle rental companies to refuse to rent to drivers under age 25. On appeal, Lazar challenges this finding. We independently construe statutory law, as its interpretation is a question of law on which we are not bound by the trial court's analysis. (California Teachers Assn. v. San Diego Community College Dist. (1981)
The Unruh Act prohibits arbitrary discrimination by businesses on the basis of specified classifications such as age. (§ 51; see Harris v. Capital Growth Investors XTV (1991)
The Unruh Act does not permit courts "to engage in complex economic regulation under the guise of judicial decisionmaking." (Harris v. Capital Growth Investors XIV, supra,
The Legislature regulates vehicle rental agreements. (See § 1936.) By state law, the term "authorized driver" for purposes of a vehicle rental agreement means "(A) the renter, (B) the renter's spouse if that person is a licensed driver and satisfies the rental company's minimum age requirement, (C) the renter's employer or coworker if they are engaged in business activity with the renter, are licensed drivers, and satisfy the rental company's minimum age requirement, and (D) any person expressly listed by the rental company on the renter's contract as an authorized driver." (§ 1936, subd. (a)(3).) If the words of a statute are reasonably free of ambiguity and uncertainty, we look no further than those words to determine the meaning of that language. (Building Industry Assn. v. City of Camarillo (1986)
Undeterred by the lack of statutory language to support his claim, Lazar argues that we should read into it a requirement that the minimum age to rent a vehicle must be reasonable. When construing a statute, the Legislature admonishes us that a judge's duty is "simply to ascertain and declare what is in terms or in substance contained therein, not to insert what has been omitted, or to omit what has been inserted...." (Code Civ. Proa, § 1858; see McAlexander v. Siskiyou Joint Community College (1990)
This conclusion is bolstered by several other maxims of statutory interpretation. First, although section 1936 uses the term "reasonable" in other contexts, it does not do so with reference to the age requirement. (Compare § 1936, subd. (a)(3) with id., subd. (m)(2).) In order to determine the intent of the Legislature, provisions should be read together. (Building Industry Assn. v. City of Camarillo, supra, 41 Cal.3d at pp. 818-819,
Second, a more recent provision is typically more persuasive than an older one. (See Schmidt v. Superior Court, supra,
*375 Third, we give effect to a specific statute relating to a particular subject in preference to a general statute. (See Schmidt v. Superior Court, supra,
C. Unfair Competition
The trial court also sustained Hertz's demurrer without leave to amend to Lazar's two causes of action alleging refusal to rent in violation of California's unfair competition law (UCL). (See Bus. & Prof.Code, §§ 17200-17209.) It concluded that section 1936 permitted vehicle rental companies to refuse to rent to drivers under age 25. On appeal, Lazar challenges this conclusion.
The UCL defines unfair competition as any unlawful, unfair or fraudulent business practice and any unfair, deceptive, untrue or misleading advertising. (Bus. & Prof.Code, § 17200; Stop Youth Addiction, Inc. v. Lucky Stores, Inc. (1998)
Lazar also argues that even if the Unruh Act claims fail, that the trial court should still have overruled the demurrers to these two UCL causes of action because Hertz's refusal to rent also constituted an unfair business practice. (See State Farm Fire & Casualty Co. v. Superior Court, supra, 45 Cal.App.4th at pp. 1102-1103,
III. AGE-BASED SURCHARGES
A Standard of ReviewSummary Adjudication
Lazar also contends that the trial court erred by finding the imposition of age-based surcharges on drivers under age 25 was not unreasonably high or unlawfully discriminatory as a matter of law. The Legislature has authorized age-based surcharges by specifically permitting a rental company to impose a surcharge based on reasonable age criteria established by the rental company. (§ 1936, subd. (m)(2).) Lazar's argument is that the fees were unreasonable, not that the surcharge was itself illegal. Two of the causes of action of Lazar's second amended complaint are before us in this aspect of his appealan Unruh Act cause of action to which the trial court sustained Hertz's demurrer without leave to amend and a UCL violation cause of action to which the trial court granted Budget and Alamo's motion for summary adjudication.
A defendant is entitled to summary adjudication [4] if it meets the burden of showing that a cause of action is meritless because one or more elements of the cause of action cannot be established. Once the defendant has met this burden of proof, the burden shifts to the plaintiff to show that a triable issue of material fact actually exists about that cause of action. On appeal from a judgment after an order granting summary adjudication of a cause of action, we independently review the trial court record to determine whether a triable issue of material fact exists. We strictly construe the defendant's affidavits and liberally construe those of the plaintiff. We accept as fact only those portions of the defendant's evidence that is not contradicted by the plaintiffs evidence. Thus, we deem the facts alleged by the plaintiffthe party opposing summary adjudicationand the reasonable inferences we can make from those facts to be true. (Ojavan Investors, Inc. v. California Coastal Com. (1997)
B. Unfair Competition
The trial court granted summary adjudication to Budget and Alamo on Lazar's UCL cause of action based on claims of improper surcharges, finding this cause of action meritless. It had earlier overruled a demurrer to this cause of action, but the summary adjudication motion allowed the trial court to consider not just the pleadings, but the evidence proffered by either side when making its ruling. (See Code Civ. Proc, § 437c, subd. (b).)
*377 Again, Lazar claims both unlawful and unfair business practices pursuant to the UCL. The lack of an actionable Unruh Act violation underlying his unlawful business practices claim necessarily defeats that aspect of his UCL cause of action. (See Code Civ. Proc, § 430.10, subd. (e); Stop Youth Addiction, Inc. v. Lucky Stores, Inc., supra, 17 Cal.4th at pp. 566-567,
As to his unfair business practices claim, Lazar argues that the surcharges were unfair because they were too high and because the unreasonably high surcharges were assessed only against renters under age 25. In the trial court, Budget and Alamo argued that Lazar's discovery responses were factually devoid of evidence and thus, he had no evidence to support the factual allegations of his complaint. On appeal, Lazar argues as he did in the trial court that he was not obligated to bring forth any evidence of unfair surcharges in order to survive a summary adjudication motion. We disagree. On a motion for summary adjudication, a defendant may rely on a plaintiffs factually inadequate discovery answers to seek summary adjudication of a particular cause of action. If plaintiff fails to adduce evidence during discovery to support the factual allegations of his or her complaint, the burden shifts to the plaintiff and the motion may be granted if the plaintiff does not set forth specific facts that show a triable issue of material fact. (See Union Bank v. Superior Court (1995)
C. Unruh Act
The trial court also sustained a demurrer to Lazar's cause of action for Unruh Act violations based on allegations of unreasonable surcharges. It found that section 1936 permitted vehicle rental companies to impose a surcharge on drivers under age 25. Lazar argues as if the Legislature requires the amount of the surcharge to be reasonable, when in fact the statute requires only that the age limitation for the surcharge be reasonable. (See § 1936, subd. (m)(2).) To the extent that he would have this court read a reasonableness requirement into the surcharge amount provision, we decline to do so.
In various places in section 1936, the Legislature set forth specific dollar or actual cost limitations that vehicle rental agreements may not exceed. (See, e.g., § 1936, subds. (b)(4), (6), (c)(7).) However, in subdivision (m)(2) (permitting a surcharge for drivers of certain ages), the Legislature did not specify any dollar amount or other cost limitation. By implication, the Legislature's omission is significant, suggesting that it intended a different purposethat is, not to impose such a limitation but to leave this amount to the business judgment of the vehicle rental companies. (See Campbell v. Zolin, supra,
Thus, this case concerns a question of economic policythat is, whether the surcharge is too high and should be regulated. (See, e.g., California Grocers Assn. v. Bank of America (1994)
Alternatively, Lazar contends that the issue of reasonableness is a factual one requiring a trial, effectively precluding resolution on demurrer. We disagree with his analysis. Unruh Act issues are often decided on demurrer or motion for summary judgment when the business practice appears to be valid on its face as bearing a reasonable relation to appropriate commercial objectives for a public enterprise. (Harris v. Capital Growth Investors XIV, supra,
The judgment is affirmed.
HANLON, P.J., and McGUINESS, J.,[*] concur.
NOTES
Notes
[1] All statutory references are to the Civil Code unless otherwise indicated.
[2] The respondents are the Hertz Corporation, Budget Rent a Car Corporation, National Car Rental Systems, Inc. and Alamo Rent-A-Car, Inc. For convenience, the opinion will refer to all four respondents as "Hertz."
[3] In this matter, the trial court stated its belief that no amendment could cure the defect in the complaint, given the application of the statute.
[4] We have already set forth the standard of review for a judgment after an order sustaining a demurrer without leave to amend. (See pt. II. A., ante.)
[5] In light of this conclusion, we need not consider Lazar's additional contention that if this case is remanded to the trial court for further proceedings, venue should be returned to Alameda County. This resolution also renders moot Hertz's request that we take judicial notice of four documentsa 1993 teen driver report as well as statements and designations from foreign corporations for three of the four respondents.
[*] Presiding Justice of the Court of Appeal, First District, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.
