Lead Opinion
Opinion
In this appeal we consider whether a provision of the Santa Monica Rent Control Charter Amendment (art. XVIII, Santa Monica City Charter, hereafter Charter Amendment) which provides for administrative adjudication of excess rent claims and imposition of treble damages (id.,
We will conclude that administrative adjudication of excess rent claims under the Charter Amendment does not, in and of itself, violate the judicial powers clause. We will hold, however, that imposition of treble damages is a power beyond the Board’s authority. We will also conclude that, on the facts of this case, the Board’s order, which authorizes immediate rent withholding, violates the judicial powers clause.
I. Facts
A. The Charter Amendment
In April 1979 the voters of the City of Santa Monica adopted by initiative a rent control ordinance to be administered by the Board. The Charter Amendment gives the Board power to promulgate pertinent regulations, and to hear and determine complaints of violations of the system as administered. (§§ 1803, subd. (g), 1805, subd. (d); former § 1809, subd. (b).)
The Charter Amendment regulates the maximum allowable rents for controlled rental units and authorizes adjustments in maximum rents by way of both general (i.e., “across the board”) and individual proceedings. (§§ 1804, 1805.) Under section 1810, any violation of the Charter Amendment by a landlord constitutes a misdemeanor punishable by a fine of not more than $500 or imprisonment for not more than six months in county jail, or both. Under section 1811, the Board, tenants or landlords of controlled units may seek a court order enjoining violations of the rent control law.
In addition, section 1809 of the Charter Amendment permits a court action for damages. (Id., subds. (a) & (d).) At the time this case arose (see post, fn. 2), subdivision (a) of section 1809 provided: “Any landlord who demands, accepts, receives, or retains any payment of rent” in excess of the maximum allowed under the ordinance or the rules promulgated thereunder “shall be liable ... to the tenant... for reasonable attorney’s fees and costs as determined by the court, plus damages in the amount of five hundred dollars ($500) or three (3) times the amount by which the payment . . . received or retained exceeds the maximum lawful rent, whichever is the greater.”
Section 1808 provides for review of the Board’s decision. “A landlord or tenant aggrieved by any action or decision of the Board may seek judicial review by appealing to the appropriate court within the jurisdiction.” The method of “appeal” utilized has been the filing of a petition for writ of administrative mandate pursuant to Code of Civil Procedure section 1094.5.
B. The Proceedings Below
Two tenants, Smith and Plevka, filed an administrative complaint under the Charter Amendment, asserting plaintiff McHugh had charged them excess rent. After a hearing officer made initial determinations and orders, all parties appealed to the Board. The Board held the tenants had been overcharged, and awarded restitution of excess rent as well as treble damages. It expressly authorized Plevka (who remained in possession of the rental unit) to withhold $2,797.91, calculated as follows: $2,448 in treble damages ($816 for excess rent charged before the hearing examiner’s findings, multiplied by three) plus $252 (excess rent charged after the hearing examiner’s findings) plus $97.91 (interest on excess rents). The Board’s order further stated, “The withheld amounts shall not form the basis for an unlawful detainer proceeding based upon non-payment of rent.” (See § 1806, subd. (a).) The Board ruled that Smith (who had since vacated the rental unit) was entitled to total recovery of $1,593.08, calculated as follows: $1,411.50 in treble damages ($470.50 in excess rent charged before the hearing examiner’s findings, multiplied by three) plus $130 (excess rent
Plaintiff filed a petition for writ of mandate (Code Civ. Proc., § 1094.5) pursuant to section 1808. Subsequently, other landlords were permitted to file a complaint in intervention. Plaintiff’s petition sought to compel the Board to set aside its decision on the ground that administrative adjudication of “excess rents” under former section 1809, subdivision (b), violates, inter alia, the judicial powers clause of the California Constitution. (Art. VI, § 1.) Plaintiff also sought to enjoin the Board from acting on any complaints for excess rent under the former subdivision. The intervening landlords sought not only similar declaratory and injunctive relief, but also a declaration that interveners had a constitutional right to jury trial in any “case” for damages or penalties.
After a hearing, the trial court granted plaintiff’s and interveners’ motions for summary judgment and entered judgment granting the petition for writ of mandate. It issued a peremptory writ ordering the Board to vacate the Plevka and Smith decisions, and declared former section 1809, subdivision (b), of the Charter Amendment “invalid because it requires the . . . Board to exercise judicial powers which fall within the ambit of Article VI, Section 1, of the California Constitution.” The court issued a permanent injunction prohibiting the Board from proceeding on any pending or future complaint for excess rents under the former subdivision, and declared the Board’s regulations invalid insofar as they implemented the former subdivision, but did not address interveners’ jury trial claim. The Board appealed.
II. Analysis
A. Background
Article VI, section 1 of the California Constitution provides: “The judicial power of this State is vested in the Supreme Court, courts of appeal, superior courts, municipal courts, and justice courts. ...” Despite the breadth of that statement, various administrative agencies in this state are authorized by the Constitution to exercise judicial powers. Some of these agencies are created by the Constitution, and are thereby vested with certain judicial powers (e.g., arts. XX, § 22 [Department of Alcoholic Beverage Control], XII [Public Utilities Commission]); others have been legislatively endowed with judicial powers pursuant to a specific constitutional authorization (see art. XIV, § 4 [Workers’ Compensation Appeals Board]; id., § 1 [“The Legislature may provide . . . for the general welfare of employees and for [that purpose] may confer on a commission legislative,
We have often noted that agencies not vested by the Constitution with judicial powers may not exercise such powers. “[A]rticle VI disposes of all judicial power not expressly disposed of elsewhere in the Constitution .... [Ajlthough the Legislature retains the authority to grant a multitude of powers to local bodies pursuant to article XI, powers of a judicial nature are no longer at its disposal.” (Strumsky v. San Diego County Retirement Assn. (1974)
B. The Jersey Maid Decision
Almost 50 years ago we held an ostensibly similar grant of power to an administrative agency unconstitutional under article VI, section 1. (Jersey Maid Milk Products Co. v. Brock (1939)
Jersey Maid involved a broad constitutional challenge to the Milk Stabilization Act. In creating the act, the Legislature expressly declared that production and distribution of milk was “a business affected with a public interest.” (
This court upheld most of the act’s provisions against various due process and equal protection challenges. (13 Cal.2d at pp. 636-651, 652-660.) We specifically rejected numerous attacks grounded on the notion that the act unconstitutionally conferred legislative power on the director, by allowing him to decide whether to set minimum prices, and to fix such prices. In addition, we rejected broad challenges (asserting violations of both the “judicial powers” and “legislative powers” clauses (Cal. Const., arts. VI, § 1, IV, § 1)), to the director’s authority to employ “judicial power ... in that he is empowered to hold hearings at which evidence is produced and findings of fact are made by him.” (
Nonetheless we invalidated—on grounds that it violated the Constitution’s judicial powers clause—a provision allowing the director to entertain and resolve complaints by milk producers against milk distributors. The challenged section permitted the director to “determine the amount of damage, if any, to which a complainant is entitled as a result of a failure of the distributor to pay for fluid milk or fluid cream as in this chapter provided, and in such case the director may make an order directing the offender to make reparation and pay to such person complaining such amount on or before the date fixed in the order.” (
Plaintiff asserts the director’s power held unconstitutional in Jersey Maid is indistinguishable from the Board’s authority to determine excess rents and order reparations under section 1809, subdivision (b). Plaintiff’s premise is that the “damages” which the Jersey Maid court found to be beyond the agency’s powers were merely restitutive in nature (i.e., the difference between the minimum price and the actual price). She reasons that because the milk board was prohibited from adjudicating and awarding such restitution in Jersey Maid, the Board here is likewise prohibited from doing the same (and, it follows, from imposing treble damages).
Precise interpretation of Jersey Maid is difficult; discussion of the damages issue was, at best, conclusory. It may be, as plaintiff suggests, that the court considered an award of “damages” of any kind to be beyond the board’s powers. But because the Jersey Maid court did not explain or articulate the nature of the “serious defect” of the statutory provision, it is unclear whether that decision was based on plaintiff’s view, or on some other rationale. For example, the Jersey Maid decision might have rested on a conclusion that the provision was unconstitutional because it did not specifically provide for judicial review of the administrative determination. (See post, pp. 361-362 [discussing the “principle of check”].)
When, as here, a decision treats an issue in a “summary and conclusory” manner, and is “virtually devoid of reasoning,” its authoritative status is undermined. (City of Berkeley v. Superior Court (1980)
C. Constitutional Propriety of the Powers at Issue in This Case
The challenged powers exercised by the Board in this case are of two distinct kinds: (i) the power to adjudicate “excess rent” claims, and (ii) the power to award treble damages. We address them in turn.
1. The power to make “restitutive” money awards
As we explain below, prior California cases provide no direct guidance on the propriety of administrative restitutive money awards. Cases dealing with administrative licensing agencies, however, suggest that such agencies may properly order reparations as a probationary condition of a licensee, and hence these cases shed some light on the issue posed here. Moreover, the decisions of our sister states provide helpful guidance. The out-of-state decisions unanimously hold that an administrative agency may—consistently with the “judicial powers” doctrine—make restitutive money awards provided (i) doing so is reasonably necessary to effectuate the administrative agency’s primary, legitimate regulatory purposes, and (ii) the “essential” judicial power remains ultimately in the courts, through review of agency determinations. We will conclude that these limitations on agency adjudication provide a reasoned and workable test by which to measure challenges under our Constitution’s judicial powers clause, and will adopt that test as our own.
a. California cases
Other than Jersey Maid, supra,
Nor do our recent cases dealing with administrative authority to award compensatory or punitive damages shed significant light on the constitutional issue presented here. In Youst v. Longo (1987)
In subsequent professional license revocation cases we rejected other “judicial power” challenges to administrative action. In so doing, we implied that so long as appropriate judicial review was available, the challenged administrative determination was not subject to attack on the ground of unlawful delegation of judicial power. (See, e.g., Drummey, supra,
We have never held, however, that the mere availability of judicial review insulates all forms of administrative adjudication from constitutional challenge under the judicial powers clause. And, we note, none of our prior cases involved an administrative restitutive award. The question arises whether, even assuming appropriate judicial review is assured, an administrative agency may constitutionally adjudicate restitutive money claims. Once again, we derive some illumination from our licensing cases.
Some commentators suggest that a licensing board’s authority to revoke or suspend licenses stems from the inherent strength of the police power itself. Professor Brown, for example, reasons that the administrative board’s authority to grant a license necessarily implies an authority to regulate license holders, and to take appropriate disciplinary action against those who violate licensing standards. (Brown, Administrative Commissions and Judicial Power (1935) 19 Minn.L.Rev. 261, 287-288; see also Jaffe, Judicial Control of Administrative Action (1966) p. 114.) But if an administrative board’s exercise of “judicial-like” power is justified as a reasonable means of effectuating its regulatory goal, it is difficult to explain why a price control board may not order restitution in order to effectuate its own regulatory goal—unless an order for monetary recovery is itself of such a character that it is purely judicial, and may be imposed only by a court.
The cases, however, have not suggested that an order for monetary recovery per se is of such character that it may be made only by a court. In practice, our administrative agencies commonly order money reparations, as when restitution is imposed as a probationary term on a licensee (e.g., Russell v. Miller (1943)
One recent Court of Appeal decision discussed the implications of administrative power to make restitutive money awards. McKee v. Bell-Carter Olive Co. (1986)
“Nevertheless, [Food and Agriculture Code] sections 55749 and 55851 make clear that once the Director has determined a [grower] is entitled to payment from a licensed processor, the Director may indirectly compel compliance with such an order by conditioning suspension of the processor’s license upon payment of the money due the [grower]. Setting aside for the moment plaintiff’s claims for damages in excess of the contract price, resort to the statutory remedy would have sufficed to make plaintiff whole, i.e., to attain for him the properly computed contract price for his olives. Thus while the statutory procedure is facially punitive, its effect is to provide an administrative remedy clearly relevant to plaintiff’s claim. Notwithstanding the Director’s inability to directly order the payment of damages, the Director’s power to conditionally suspend a processor’s license until payment
Plaintiff here appears to concede the exercise of this type of restitutive/remedial power by a licensing board does not violate article VI, section 1 of our Constitution. She does not attempt to explain, however, why the same remedial power offends the Constitution in the present context merely because it is exercised by a regulatory board that does not also exercise a licensing function.
In conclusion, although we acknowledge the constitutional importance of ensuring judicial review of administrative determinations, our prior cases do not stand for the proposition that an administrative agency may exercise all manner of “judicial-like” power on the simple condition that judicial review of the administrative decision remains available. On the other hand, our prior licensing cases have accepted without constitutional debate the authority of licensing agencies to impose a restitutive award as a probationary
b. Sister-state cases
Our constitutional provision confining “judicial powers” to the courts (Cal. Const., art. VI, § 1) has counterparts in most other state constitutions, as well as the federal Constitution. (See post, fn. 24 [state constitutional provisions]; U.S. Const., art. III, § 1 [reservation of judicial powers to the courts].) Modern courts, however, have not rigidly construed these provisions.
The accommodating view of modern courts, however, generally has been conditioned by two limiting principles, one procedural and the other substantive. First, our sister-state cases, like our own {ante at p. 361), universally recognize the constitutional necessity of the “principle of check.” They hold the availability of judicial review of administrative decisions is sufficient to satisfy the “principle of check.”
The substantive limitation is expressed in an opinion of the New Hampshire Supreme Court: “As a rule which meets most situations, when an executive board has regulatory functions, it may hear and determine controversies which are incidental thereto, but if the duty is primarily to decide questions of legal right between private parties, the function belongs to the judiciary. . . . [¶] The creation of an executive board is justified if its service is to determine and maintain a public right or interest. To accomplish its purposes judicial powers may be necessarily exerted. But they must concern matters of an executive character. They are proper if it may fairly be said that there is need of them in order to produce an efficient and effective administrative enforcement of the public interest. . . . [¶] Whatever the borderland of doubt and interchange, argument seems unneeded to demonstrate that the function of trying and deciding litigation is strictly
With these two principles in mind, we review the decisions of our sister states.
At least nine states, all of which have constitutional provisions substantially identical to California Constitution, article VI, section 1, have considered the propriety of administrative adjudication of restitutive and compensatory “damages.” The decisions unanimously hold such remedial power as is involved here does not constitute an impermissible exercise of judicial power. In order to provide more explicit illumination, we will discuss in detail two decisions which, in our view, best express the “limiting principles” mentioned above.
The Maryland Constitution, like ours, provides that the “judicial power” of the state is vested in the state high court and lower courts. (Compare Md. Const., art. IV, § 1,
An assortment of remedial powers conferred on the landlord-tenant board were challenged: “(1) to impose a civil penalty not exceeding $1,000; [¶] (2) to award money damages [to either party] not exceeding $1,000; [¶] (3) to award payments for temporary substitute housing; [¶] (4) to terminate leases; [¶] (5) to order repairs; [and] [¶] (6) to order the return of security deposits and rental moneys paid.” (
The landlords asserted such remedial powers were judicial in nature, and therefore could not be exercised by the administrative agency. (312 A.2d at
The court next specifically rejected the landlords’ claims that “the remedies entrusted to the [board’s] discretion are remedies exclusively reserved to the courts” (
The Missouri Constitution also provides that the state’s judicial power resides in the state high court and the lower courts. (Compare Mo. Const., art. V, § 1,
The Missouri court acknowledged that in exercising its authority the commission necessarily determined factual questions, and exercised discretion, and that it thereby “does exercise judicial functions.” (
Decisions of New Jersey, Wisconsin, Oregon, West Virginia, Tennessee, Kentucky and Florida—all of which have “judicial powers” provisions substantially identical to article VI, section 1 of our own Constitution
All of the foregoing sister-state decisions support an expansive view of constitutionally permissible administrative powers. Indeed, some contain broad statements that in our view may well accord too little consideration to the “substantive limitations” principle discussed above. We explain below the guiding principles we glean from these decisions.
c. Guiding principles: substantive and procedural limitations on the remedial power of administrative agencies
Although many of these decisions—including Investors, supra,
The better analyzed and more thoughtful decisions, as we read them, set out the following guidelines: An administrative agency may constitutionally hold hearings, determine facts, apply the law to those facts, and order relief—including certain types of monetary relief—so long as (i) such activities are authorized by statute or legislation and are reasonably necessary to effectuate the administrative agency’s primary, legitimate regulatory purposes, and (ii) the “essential” judicial power (i.e., the power to make enforceable, binding judgments) remains ultimately in the courts, through review of agency determinations. As noted above, the “procedural” aspect of this test {ante at p. 361) is entirely consistent with (and indeed, dictated by) established California law concerning administrative revocation of professional licenses {ante at p. 361). We review below the merit, scope, and propriety of our sister states’ substantive limitations on administrative remedial power.
(i) Substantive limitations on the remedial power of administrative agencies
The view of the judicial powers doctrine embraced by our sister states has the advantage of avoiding meaningless, wooden distinctions (used in a number of older cases) between “quasijudicial” and “judicial” powers,
Practical considerations also militate against a less accommodating view of the judicial powers doctrine. If nonconstitutional administrative agencies were barred from adjudicating all money claims between private individuals who are subject to administrative regulation, such agencies would be precluded from exercising powers routinely employed, and not previously challenged.
(ii) Procedural limitations on the remedial powers of administrative agencies
In addition to placing reasoned and workable substantive limitations on the remedial powers of administrative agencies, the view of the judicial powers doctrine embraced by our sister states also reserves to the courts the “true” judicial power. Consistently with our prior cases dealing with administrative revocation of professional licenses, the decisions uphold an agency’s authority to exercise a challenged remedial power only if the administrative scheme also respects the “principle of check” by providing for judicial review of administrative determinations. It remains, of course, to resolve in different categories of cases, the procedures for and scope of judicial review necessary to fulfill the goal of reserving to the courts this essential attribute of judicial power.
As observed above, there is no modern decision of this state addressing the precise administrative remedial power challenged here. With the exception of Jersey Maid—which, for the reasons discussed above, we do not believe should be viewed as controlling—our prior cases do not conflict with the approach taken by our sister states, and indeed they recognize the constitutional necessity of the “principle of check.” We believe our sister states’ approach (i.e., embracing substantive as well as procedural limitations on administrative power) reflects a practical and reasoned understanding of the judicial powers doctrine. With the following considerations and concerns in mind, we, like our sister states, conclude that administrative adjudication and awarding of restitution does not offend our Constitution’s judicial powers clause when these substantive and procedural limitations are respected.
We too will carefully apply the “reasonable necessity/legitimate regulatory purpose” requirements in order to guard against unjustified delegation of authority to decide disputes that otherwise belong in the courts.
d. Application of the limiting principles to the facts of this case
(i) The “reasonable necessity/legitimate regulatory purpose” requirement
As noted above, the Board held hearings, heard testimony, and determined that plaintiff charged excess rents of $1,068 to tenant Plevka, and $600.50 to tenant Smith.
The trial court erred therefore in concluding that the Board exercised judicial powers in violation of the Constitution by adjudicating (subject to judicial review) tenants’ claims for excess rents, and ordering restitution of the excess amounts.
The Board authorized tenant Plevka to “withhold[] his entire month’s rent in the first month following the Board’s decision . . . and the remaining monies in the months thereafter. The withheld amounts shall not form the basis for an unlawful detainer proceeding based upon nonpayment of rent.”
Plaintiff’s concern is significant. Under present procedures, the Board possesses the ability to make an order that, although not “final” or “self-enforcing” in the typical sense of those terms, is in fact immediately enforceable in a real sense at the discretion of a private party. By its own regulations, the Board’s decision becomes final “at the time of Board action,” i.e., immediately after the Board renders its decision. Thereafter a tenant may withhold rent up to the amount specified by the Board. In this fashion the Board’s order is given immediate practical effect: before the landlord has even the opportunity to obtain judicial review by petition for writ of mandate
Although the trial court eventually issued temporary stays limiting somewhat the Board’s orders in this case,
An administrative order of this nature is unlike any other of which we are aware. And, in our view, for the reasons set out above it represents an unwarranted intrusion into the power of the courts to “check” administrative adjudications. We thus conclude that the rent withholding order in this case violated the judicial powers provision of our Constitution (art. VI, § 1).
Having reached this determination, we agree with the trial court insofar as it found the administrative orders in this case violated the judicial powers clause. The court erred, however, insofar as it held that Board adjudication of excess rent claims under section 1809 of the Charter Amendment in and of itself violates the judicial powers clause, and enjoined future adjudication under that provision.
In addition to the “restitutive” excess rent amounts, the Board assessed treble damages against portions of both tenants’ excess rents. Tenant Plevka was awarded an extra $1,632, and tenant Smith was awarded an extra $941.
We emphasize at the outset the limited question posed here. We do not consider the constitutional propriety of administrative imposition of penalties,
Applying the “substantive limitations” prong of the test set out ante, page 372, we conclude treble damages, although authorized by the Charter Amendment, may not constitutionally be imposed by the Board. First, we note that administrative agencies regularly exercise a range of powers de
Accordingly, we agree with the trial court insofar as it held imposition of treble damages under former section 1809, subdivision (b) of the Charter Amendment violates the judicial powers clause, and enjoined future imposition of treble damages under that provision.
3. Right to a jury trial
Plaintiff interveners assert that administrative adjudication of monetary relief claims violates the state constitutional right to jury trial (Cal. Const., art. I, § 16). They reason that such relief is available only in a court action at which, under the common law, a party has a right to a jury trial. Because we uphold the Board’s authority to adjudicate “restitutive” excess rent claims, we also address plaintiff interveners’ jury trial contention.
Our Constitution states: “Trial by jury is an inviolate right and shall be secured to all. . . .” We have long observed, “It is the right to trial by jury as it existed at common law which is preserved [by article I, section 16].” (People v. One 1941 Chevrolet Coupe (1951)
When deciding whether a jury trial is required for a matter prosecuted in court we look to the “gist of the action.” If the “gist” is legal, as
A number of our sister states have addressed state constitutional jury trial challenges to similar administrative schemes.
Our sister courts have emphasized aspects of the federal courts’ “public rights” concept (discussed post, pp. 381-385) as well as other concerns, such as the existence of the action at common law, and the nexus between the challenged power and the agency’s regulatory purpose. Read together with their discussions of the judicial powers issue, we adduce from these decisions the following proposition: Once a court has determined that exercise of a challenged administrative power meets the “substantive limitations” requirement imposed by the state constitution’s judicial powers doctrine— i.e., the challenged activities are authorized by statute or legislation, and are reasonably necessary to, and primarily directed at, effectuating the administrative agency’s primary, legitimate regulatory purposes—then the state constitution’s jury trial provision does not operate to preclude administrative adjudication. Neither plaintiff, nor the amicus curiae and interveners appearing on her behalf, offer a compelling reason to reach a different conclusion under our own constitutional provision.
Without addressing the merits of the other states’ approach to the jury trial issue, plaintiff interveners propose a different analysis. They offer neither support for their proposed test, nor any compelling reason why our jury trial provision should be construed to preclude administrative adjudication of issues within the scope of an agency’s regulatory authority. In any event, we conclude that even under the novel test proposed, plaintiff interveners have shown no violation of the right to jury trial in these circumstances.
Plaintiff interveners suggest there is or should be a state constitutional right to jury trial if (i) the administrative body is “nonconstitutional” (see ante, pp. 355-356), (ii) the rights involved are “private” rather than “public,” and (iii) the “private” right is grounded in the common law. Their argument fails under the second prong of their test because, according to the very cases on which plaintiff interveners rely, the interests at issue here would be deemed “public” rights properly adjudicable by an administrative agency without a jury.
The “public” versus “private” rights distinction is drawn not from California jurisprudence, but from the federal cases addressing similar issues under, inter alia, the Seventh Amendment of the federal Constitution.
Under federal law, the right to jury trial does not attach to the administrative adjudication of “public rights.” (Atlas Roofing, supra,
In Block v. Hirsh (1921)
Similarly, in Labor Board v. Jones & Laughlin (1937)
Subsequently, in Pernell v. Southall Realty (1974)
Thereafter, in Atlas Roofing, supra,
The court rejected this argument. Quoting the above cited passages of Block v. Hirsh, supra,
The court then reviewed the historical context of the federal jury trial provision (430 U.S. at pp. 458-460 [51 L.Ed.2d at pp. 477-478]), and summarized as follows: “The point is that the Seventh Amendment was never intended to establish the jury as the exclusive mechanism for factfinding in civil cases. It took the existing legal order as it found it, and there is little or no basis for concluding that the Amendment should now be interpreted to provide an impenetrable barrier to administrative factfinding under otherwise valid federal regulatory statutes. We cannot conclude that the Amendment rendered Congress powerless—when it concluded that remedies available in courts of law were inadequate to cope with a problem within Congress’ power to regulate—to create new public rights and remedies by statute and commit their enforcement, if it chose, to a tribunal other than a court of law—such as an administrative agency—in which facts are not found by juries.” (
Finally, the court concluded: “Thus, history and our cases support the proposition that the right to a jury trial turns not solely on the nature of the issue to be resolved but also on the forum in which it is to be resolved.” (430 U.S. at pp. 460-461 [
It is true, as plaintiff notes, that in the course of vindicating a general “public right” in the enforcement of maximum rents, the administrative proceedings challenged here also determine the rights of private individuals as they relate to those rents. Nonetheless, as the United States Supreme Court observed in Thomas, supra,
III. Disposition
For the reasons discussed above, we conclude former section 1809 is not constitutionally infirm except insofar as it authorizes the Board to award treble damages and permits orders awarding restitution to become effective before there is an opportunity for the court to pass on whether to stay the challenged order pending review of the administrative decision by writ of mandate.
The judgment is reversed with directions to recall and/or set aside the peremptory writ of mandate issued by the court on November 15, 1983, to issue a new and different writ commanding the Board to reduce its awards in conformity with this decision, to stay enforcement of any future order in accordance with this decision (see ante, fn. 44), to deny the petition for writ of mandate in all other respects, and to deny the motions of plaintiff and interveners for summary judgment.
Mosk, J., Eagleson, J., Kaufman, J., and Arguelles, J.,
Notes
The Charter Amendment provision at issue in this case has since been amended. (See post, fn. 2.) All future section references, unless otherwise indicated, are to the Charter Amendment.
Pursuant to this subdivision, the Board has exercised authority to award treble damages.
In 1984 the Charter Amendment was revised. The new law retained the alternative court/administrative enforcement scheme and rent withholding remedy, but altered the provisions for monetary recovery in excess of the amount of overpaid rent. Under the revised version, treble damages are available only in a court action. (§ 1809, subds. (a), (b).) In an administrative action, a more limited “penalty” is available: “a landlord . . . may be liable for an additional amount not to exceed five hundred dollars ($500), for costs, expenses incurred in pursuing the hearing remedy, damages and penalties. The tenant shall bear the burden of showing entitlement to the penalty.” (§ 1809, subd. (b)(2).) The subdivision further provides that if the tenant vacates the premises before completing withholding of the excess rent and penalties, the landlord “shall” pay the tenant “a sum equal to that which could have been withheld.” (Ibid.)
Plaintiff suggests, for example, that the Agricultural Labor Relations Board (Lab. Code, § 1140 et seq.) is in this latter group of agencies.
See Civil Code section 1947.7. In that statute, effective January 1, 1987, the Legislature provides that as to landlords who are in “substantial compliance” with a rent control law, the “exclusive remedies” for noncompliance shall be restitution to the tenant, with recovery of filing fees due to the “local agency.” (Id., subd. (b).) The statute further provides: “Nothing in this section shall be construed to grant to any public entity any power which it does not possess independent of this section to control or establish a system of control on the price at which accommodations may be offered for rent or lease, or to diminish any such power which that public entity may possess, except as specifically provided in this section.”
Nothing in the statute purported to make the fixing of such “damages” (and the order that reparation be made) a condition of an order for license suspension or revocation. We note, however, that the act prohibited distributors from dealing in fluid milk or cream without first having obtained a license from the director, and that the director was charged with the responsibility of issuing, suspending, and revoking licenses to milk distributors. Subsequent cases have held that a licensing agency may condition suspension or revocation of a license on the licensee’s making restitution to a beneficiary of the regulation. (See post, fn. 9, and pp. 360-361.)
Amicus curiae for defendant Board suggests an alternative interpretation: “If . . . the Jersey Maid provision merely authorized an award of the difference between the amount actually paid for milk and the statutory minimum milk price, then the modifier ‘if any’ in the phrase ‘damage, if any’ would have been unnecessary because there would always be damage in the amount of this difference. Rather, this language suggests that the provision authorized awards to the producer for additional damages suffered as a consequence of the distributor’s failure to pay the statutory minimum price.” (Italics in original.)
Some cases recognize and approve administrative exercise of “judicial-like” powers (see, e.g., People v. Sims (1982)
Plaintiff suggests administrative authority under this statute is distinguishable from the present case because the FEHC—at least when it exercises authority over employment relations—is authorized by California Constitution, article XIV, section 1, to exercise judicial powers. We have not yet been called on to construe the applicability of this constitutional provision to that commission.
In both cases, however, we made statements in dictum that have some relevance here. In Youst, supra,
We noted without criticism, however, that the Board possessed powers to suspend licenses and impose fines (id. at p. 82), and we expressly declined to imply that the Board lacked “authority to require compensatory relief as a condition for reinstatement of licenses” (id. at p. 82, fn. 15).
In Dyna-Med, supra,
Later, in Whitten, supra,
Of course a licensee (unlike plaintiff in this case) in theory has the option to reject, on pain of license revocation, the administrative agency’s probationary terms.
Under Food and Agricultural Code section 55401 et seq., the Director of the Bureau of Marketing Enforcement licenses processors of farm products. A grower who has been refused a contract payment by a processor has two options: he may enforce a producer’s lien in court, or he may seek administrative relief from the director.
If he selects the administrative remedy, the grower files a complaint. Thereafter, the director must review the processor’s accounts. If he finds a violation of law—including failure or refusal to pay the grower for “farm products”—he may issue a complaint against the processor. If the director cannot effect settlement of the dispute, he may hold a hearing for which he may issue subpoenas, and at which he may take testimony, and decide if the processor has violated the law. (
If the director finds a processor has failed to pay a grower for his products, the director “may issue an order which suspends or revokes the processor’s license or places such license under such probationary terms and conditions as may be necessary to obtain compliance with the provisions of this chapter by such licensee.” (Food & Agr. Code, § 55749.)
The McKee court, of course, was bound by our Jersey Maid decision. (Auto Equity Sales v. Superior Court (1962)
The only court to consider that distinction has rejected it. Plasti-Line, Inc. v. Human Rights Com’n (Tenn. 1988)
Preliminarily, we note that some United States Supreme Court cases address, in the context of article III of the federal Constitution, issues similar to those posed here. (See, e.g., Commodity Futures Trading Comm’n v. Schor (1986)
Both parties, sometimes quoting the same language, assert these cases support their respective views that the rent board may, or may not, adjudicate the “excess rent” claims involved here. We find, however, that the cited cases provide no clear guidance on the judicial powers question posed here. (See Fallon, Of Legislative Courts, Administrative Agencies, and Article III (1988) 101 Harv.L.Rev. 915 [criticizing the high court’s analysis in the above cases and proposing that availability of judicial review should be sufficient to protect the values underlying the separation of powers/judicial powers doctrine].) Suffice it to say that the state cases cited below, and our holdings in this case, do not conflict with the holdings of these high court cases construing the federal Constitution.
One commentator has written: “It was for a long time maintained by both eminent textwriters and by the courts . . . that the legislature is powerless to delegate judicial duties to administrative officers. [¶] But candor compels recognition of the hard fact that these statements have become mere shibboleths, shattered by the hard course of decision—reverently repeated, but not followed in practice. [¶]... Though the old rubrics prohibiting delegation are still occasionally repeated, they no longer shape decision.” (1 Cooper, State Administrative Law (1965) pp. 46-47, 48, fns. omitted.)
See, e.g., County Coun., Montgomery Cty. v. Investors F. Corp. (1973)
See Kentucky Com’n on Human Rights v. Fraser (Ky. 1981)
See also, e.g., Zahorian v. Russell Fitt Real Estate Agency (1973)
“The Judicial power of this State is vested in a Court of Appeals, such intermediate courts of appeal as the General Assembly may create by law, Circuit Courts, Orphans’ Courts, and a District Court. These Courts shall be Courts of Record . . . .”
In addition, the court addressed the provision authorizing the board to impose a “civil penalty” up to $1,000 for violation of the landlord-tenant laws. It stressed that such a power may constitutionally be delegated to an administrative agency (id., at p. 246). (Indeed, a number of other state cases are in accord, see post, fn. 45.) The court struck the penalty provision before it, however, because the law provided no standard by which the board was to impose penalties. Because the board was free to exercise unguided discretion in making such awards, with the consequence that there could be “no meaningful judicial review,” the court held the civil penalty provision as drafted was illegal. (Ibid.)
“The judicial power of the state shall be vested in a supreme court, a court of appeals consisting of districts as prescribed by law, and circuit courts.”
Compare California Constitution, article VI, section 1 (quoted ante, p. 355), with New Jersey Constitution, article IV, section 1; Wisconsin Constitution, article 7, section 2; Oregon Constitution, article VII, section 1; West Virginia Constitution, article 8, section 1; Tennessee Constitution, article 6, section 1; Kentucky Constitution, section 109; and Florida Constitution, article V, section 1.
The court continued: “[The Board is] ‘an administrative body or arm of the government, which in the course of its administration of a law is empowered to ascertain some questions of fact and apply the existing law thereto, and in so doing acts quasi -judicially; but it is not thereby vested with judicial power in the constitutional sense.’ ” (
The court reasoned: “The mere fact that the Commission is involved in adjudication does not in itself render the statute unconstitutional as a usurpation of judicial power. Administrative agencies are frequently involved in the adjudication of disputes (Worker’s Compensation, Unemployment Compensation, reparations before the Interstate Commerce Commission, and the like). ... In Kentucky, and elsewhere, this authority of administrative bodies extends to the determination of liabilities between individuals .... The substantial trend of authority extends administrative powers of adjudication to encompass the award of damages. [Citations.] We find nothing unconstitutional in the administrative award of damages under this statute where due process procedural rights have been protected, where prohibited conduct has been well defined in the governing statute, and where judicial review is available.” (Id. at pp. 854-855.)
The Plasti-Line court stressed that the commission’s remedial orders are not self-executing, but instead required an enforcement order from the court. (
The court relied on Broward County v. La Rosa (Fla. 1987)
Other courts have rejected broad attacks on administrative power to award monetary damages, but have not addressed expressly the constitutional issue posed here. See Massachusetts Com’n Against Discrim, v. Franzaroli (1970)
Additionally, courts have frequently approved the exercise by antidiscrimination commissions, and other boards, of broad remedial powers to issue injunctions, cease and desist orders, etc. (E.g., State v. Bergeron (1971)
Use of the bare term “quasijudicial,” as a means of distinguishing between permissible and nonpermissible administrative functions, has been justly criticized as perpetrating an unworkable standard. (See Fed. Trade Comm’n v. Ruberoid Co. (1952)
The New Jersey Supreme Court, in Zahorian, supra,
Discussing a similar point of federal constitutional law, Professor Fallon has noted: “Legislation always enjoys a presumption of constitutionality, and a court should be especially hesitant to embrace a theory or principle that requires the invalidation of large numbers of important statutes. It is one thing to strike down a relatively isolated provision, quite another to demand widespread reform of entrenched institutional practice. [Footnote omitted.]” (Fallon, supra, 101 Harv.L.Rev. 915, 921.) The omitted footnote reads: “The presumption against displacing even widespread statutory practice is of course not irrebuttable. Cf. Immigration & Naturalization Serv. v. Chadha,
Some procedural concerns arising in this case are discussed post, pages 375-377.
As to the standard of review, see post, footnote 36.
See In re Opinion of the Justices, supra,
Licensing agencies, for example, typically possess implied legislative authorization to [i]mpose restitution as a condition of probation on a disciplined licensee. (See, e.g., Russell v. Miller, supra,
In this regard we observe that in cases such as this—in which a private party has a “direct pecuniary interest” in the administrative agency’s determination—the independent-judgment test may be the appropriate standard for a court to apply in reviewing the administrative determination. (See County of Alameda v. Board of Retirement (1988)
Also as noted above, the Board found and assessed interest on those amounts of $97.91 and $51.58, respectively.
We are not called on to decide whether an administrative agency’s award of general compensatory damages would violate the judicial powers clause and we express no opinion on the issue.
Because Smith was no longer a tenant, the Board ordered simply that “Complainant Smith is entitled to total damages” of a specified amount.
Defendant responds that we have previously affirmed the constitutionality of rent withholding. (Fisher, supra,
See Charter Amendment section 1808 (Board’s decision is “appeal[able] to the appropriate court within the jurisdiction”).
The Board’s decision was made in late March 1983. Thereafter Plevka withheld his rents for April, May, and June. In late June plaintiff sought review by a writ of mandate (Code Civ. Proc., § 1094.5, subd. (a)), and a stay (id., subd. (g)), from the superior court. On plaintiff’s motion, the court granted an order to show cause and temporary stay of the Board’s order. The court’s order required the Board to show cause why it should not “stay operation” of the Board’s administrative decision (pending entry of judgment of the court in this action) as follows: “A. . . . [Tenant] Smith, shall take no action to enforce the . . . Board’s decision declaring that she is entitled to recover from [plaintiff] the sum of. . . $1,593.08 pending the entry of the judgment of the court in this action; and
Additionally, the court ordered the Board to stay operation of its administrative decision, “on the terms and conditions set forth in subparagraphs ‘A’ and ‘B’ above, pending the hearing of this order to show cause.”
A month later, on defendant’s motion, the court modified its temporary stay order. The new order retained provision “A,” but additionally required plaintiff to place in her attorney’s trust account, in three monthly installments, the $1,593.08 declared by the Board to be owed to Smith. It also modified provision “B,” absolving tenant Plevka of responsibility to place in trust the withheld rents of April, May, and June, and ordering instead that he begin in July to place rents in the trust account.
Similarly, tenant Smith was free to take legal action to enforce the Board’s award as to her.
Our holding is limited by the facts of this case: we consider only the propriety of an administrative order requiring immediate payment of money or authorizing immediate withholding of money that would otherwise be owed. We do not address other types of administrative orders having immediate effect, including immediately effective restitutive orders issued by professional licensing boards.
The Board may avoid the constitutional problem outlined above by (as a matter of regular procedure) staying enforcement of its orders for a period of time sufficient to allow an aggrieved party to seek from the courts a stay of the Board’s order under Code of Civil Procedure section 1094.5, subdivision (g). (Cf., Gov. Code, § 11519, subd. (a) [“The decision shall become effective 30 days after it is delivered or mailed to respondent unless ... a stay of execution is granted.”].)
A number of pollution control statutes authorize such penalties. (See, e.g., Health & Saf. Code, § 25189.2, subd. (e); Wat. Code, §§ 13261, subds. (b) & (d), 13265, subds. (b) & (d), 13268, subds. (b) & (d), 13350, subds. (d), (e) & (f); Food & Agr. Code, § 12999.5, subd. (a).) We note that our sister states have approved in principle the authority of administrative agencies to impose money penalties as a reasonable means of enforcing administrative regulations. (See City of Waukegan, supra,
At least one statute provides for “punitive damages” of up to $1,000 to be awarded by the FEHC in housing discrimination matters. (Gov. Code, § 12987, subd. (2).) In Hess v. Fair Employment & Housing Com., supra,
As we observed, ante, footnote 4, effective January 1, 1987, “penalties and sanctions” may not be imposed against a landlord who is in “substantial compliance” with a rent control ordinance. (Civ. Code, 1947.7, subd. (b).) In such a case, restitution or recovery of filing fees “shall be the exclusive remedies.” (Ibid.)
Although defendant cites no other administrative scheme in which treble damages are allowed, we have discovered one such scheme in the rent control law of the District of Columbia. In Mudd v. D.C. Rental Housing Com’n (D.C.App. 1988)
Cf., 2 Areeda & Turner, Antitrust Law (1978) ¶ 331b2, page 150, discussing policy reasons against private actions for treble damages under the federal antitrust laws: “[T]he common law’s usual discomfort with imposing unforeseen liability is greatly exacerbated when compensatory damages are automatically trebled. A defendant might reasonably suppose that he is complying with the antitrust laws, only to discover that he was mistaken initially or that the law has changed in the meantime. . . .” In the same vein, see Comment, Antitrust Enforcement by Private Parties-. Analysis of Developments in the Treble Damage Suit (1952) 61 Yale L.J. 1010, 1062 (“private suits may create windfalls, for triple damage awards . . . shape recoveries in excess of actual loss”).
Having reached this conclusion we need not address plaintiff’s assertion that Grossblatt v. Wright (1951)
Applying that standard in a court action for treble damages under a 1947 federal rent control statute, the court in Grossblatt, supra,
See, e.g., Perry Farms, Inc. v. Agricultural Labor Relations Bd. (1978)
The language of the jury trial provisions of these states is substantively similar to article I section 16 of the California Constitution. (See Ky. Const., § 7; Tenn. Const., art. 1, § 6; Wis. Const., art. 1, § 5; W.Va. Const., art. 3, § 13; Ore. Const., art. I, § 17; Md. Const., art. 5.)
Resolution of the question might be different in a situation in which an agency purports to adjudicate substantial “damage” claims such that recovery of damages becomes the primary focus, as opposed to merely an incidental aspect of the regulatory scheme. (See, e.g., Zahorian, supra,
Although the Seventh Amendment applies only to actions in the federal courts (see Crouchman v. Superior Court (1988)
The court gleaned additional guidance from its earlier cases discussing the propriety of administrative fines and penalties (see cases cited ante, fn. 45), and observed that although those cases did not specifically discuss the jury trial claim, “[i]t is difficult to believe that these
In Atlas Roofing the government was the prosecuting party. Subsequently the court has made clear that its public rights doctrine does not require participation by the government as a party of record in the administrative litigation. (See Thomas, supra,
After noting that it had previously characterized the landlord-tenant scheme involved in Block v. Hirsh, supra, 256 U.S. 135, as involving “public rights,” the court observed that such “proceedings surely determine liabilities of individuals,” and yet they would be “beyond the power of Congress” under a restrictive interpretation of the public rights doctrine. (Thomas, supra,
We recognize that in CFTC, supra,
The high court upheld the agency’s power to adjudicate the counterclaim. The opinion concluded that exercise of such power does not violate the “structural interests” that inform
Retired Associate Justice of the Supreme Court sitting under assignment by the Chairperson of the Judicial Council.
Concurrence Opinion
I concur fully in the judgment and its underlying reasoning. I write separately to emphasize that we do not in this case decide the validity of an administrative scheme that, in the guise of advancing “public” rights or the general welfare, permits an agency to award substantial general compensatory damages to an aggrieved individual on grounds such dam
In Labor Board v. Jones & Laughlin (1937)
In determining the application of our constitutional jury trial provision (Cal. Const., art. I, § 16) to the administrative award of damages, the majority adopts the substantive-limitations test earlier applied in the context of the judicial powers doctrine. Pursuant to that test, if the challenged activities (i.e., the remedy or damages award) “are authorized by statute or legislation, and are reasonably necessary to, and primarily directed at, effectuating the administrative agency’s primary, legitimate regulatory purposes—then the state constitution’s jury trial provision does not operate to preclude administrative adjudication.” {Ante, at p. 380.)
As in Jones, supra, the damages at issue in the instant case—excess rent— are restitutive in kind and limited in amount. Resolution of the jury trial issue, as the majority suggests, “might be different in a situation in which an agency purports to adjudicate substantial ‘damage’ claims such that recovery of damages becomes the primary focus, as opposed to merely an incidental aspect of the regulatory scheme.” {Ante, at p. 381, fn. 53.)
Although the award of general compensatory damages may have substantive effect, in that it deters violation of the regulatory scheme, and thus arguably may meet the substantive-limitations requirement, when the damages awarded advance a substantial private interest in remuneration that is disproportionate to the concept of public relief, the right to jury trial is implicated and a jury is required. Regardless of the substantive effect of a general damages award in effectuating an agency’s legitimate regulatory purposes, an administrative hearing cannot, consistent with the right to trial by jury, be transformed into a forum for adjudicating general damages. Neither the substantive-limitations test, nor our opinion, should be understood as sanctioning an administrative award of unlimited general compensatory damages.
Eagleson, J., concurred.
Concurrence Opinion
I agree that it is not a violation of the separation of powers doctrine to authorize an administrative agency to adjudicate claims between individuals when this power is reasonably necessary to effectuate the agency’s legitimate regulatory purpose, and when the essential judicial power remains in the courts by way of judicial review of agency determinations. (See maj. opn., ante, at p. 372.)
I do not agree that the portion of the Santa Monica Rent Control Ordinance, which permits the rent control board (Board) to order a landlord who has overcharged to pay damages of three times the overcharge, violates this standard. Nor do I agree that a Board order that is effective immediately so inhibits effective judicial review as to make the order unconstitutional.
1. Treble Damages.
The majority distort the scope of judicial review of legislative enactments and ignore the rationale for their own standard in rejecting the treble damage element of the ordinance. They do not question the general power of administrative agencies to impose penalties. They cannot; their own citations demonstrate that the matter is settled at the state and federal levels, and that many of our own state regulations provide for administrative penalties. (See maj. opn., ante, at p. 378, fn. 45.) They conclude, too, that “restitutive” compensatory damages are appropriate in the rent control context. Nonetheless they reject the former provision of the Santa Monica ordinance which provided that the Board may order a landlord who has overcharged on rents to pay the tenant “three (3) times the amount by which the payment . . . received or retained exceeds the maximum lawful rent.” (Santa Monica City Charter, art. XVIII, § 1809(a).) They offer two explanations. The first is that other methods such as “imposition of fines or penalties, awards of costs and attorney fees” could be used to induce compliance with the rent control ordinance, and there is no reason to think these would be insufficient. (Maj. opn., ante, at p. 378.) Second, they worry that the authority to award treble damages will encourage arbitrary and “disproportionate” results. {Ibid.)
The translation for these objections is that the majority do not like treble damages, think other methods of enforcement would work, and think that a treble damage award is too high for the sin being punished. These are proper considerations for legislating, not judging. Our job is to determine whether the provision is constitutional, not if it is a good idea. The provision is constitutional if it is reasonably necessary to the administrative body’s proper regulatory purpose, and if there is judicial review. It is and there is. That should be the end of the matter.
We start with the premise that legislative action is reasonable and constitutional. “‘[A]ll presumptions and intendments favor the validity of a
The majority fail to abide by these principles of judicial deference to legislative policymaking. We do not sit to determine the wisdom of legislation or the political worthiness of legislative goals or action. (Calfarm Ins. Co. v. Deukmejian, supra,
As the majority and the authorities they rely on explain, the reason we require that administrative adjudication be reasonably necessary to a legitimate administrative purpose is to avoid relegating purely private disputes, the traditional core of common law actions, to administrative resolution. (See maj. opn., ante, at pp. 366, 368, 372, 374.) A treble damage award for violating administrative regulations does not endanger judicial hegemony over traditional common law actions.
The treble damage award here is a penalty against the landlord for failing to comply with the ordinance. It is obviously not compensatory, but punitive. The tenant is compensated for the rent overcharge when the Board orders the payment of damages in the amount of the rent overcharge. The portion of the ordinance providing for an award of an additional $500, or three times the overcharge, whichever is greater, is clearly punitive and designed to enhance enforcement.
A penalty against an individual for violating a legitimate state regulation is completely unlike a traditional common law action between individuals. It is inextricably intertwined with the essential regulatory purpose of the Board—to set and enforce stabilized rents. The fact that it is payable to an individual rather than the state does nothing to detract from its essentially regulatory purpose. If we conclude that “restitutive” compensatory damages to remedy individual harm are necessary to the fulfillment of the
The majority are concerned that the power to award treble damages makes the risk of arbitrariness “inherent in any scheme of administrative adjudication” too high. (See maj. opn., ante, at p. 379.) There is a short answer to this concern: judicial review. Any arbitrariness in awarding treble damages is just as susceptible of correction by way of judicial review as arbitrariness in awarding “restitutive” compensatory damages.
2. Effective Date of Order.
The ordinance provides that a tenant “may deduct the penalty from future rent payments in the manner provided by the Board.” A Board regulation provided that its orders were final immediately. In this action, the Board authorized one tenant to withhold rent in the first month following the Board’s decision, and for additional months, and provided that the withholding should not be the basis for an unlawful detainer proceeding based on nonpayment of rent. The majority conclude that the order is unconstitutional because it was immediately enforceable at the “discretion of a private party.”
The majority complain that the tenant could withhold rent and resist an unlawful detainer action before the landlord had an opportunity to obtain judicial review. What is really at stake, however, is the landlord’s ability to seek a stay of the Board’s order pending judicial review. “Before there was an opportunity for the court to pass on whether to stay temporarily the Board’s rent withholding order, tenant Plevka immediately withheld rent, and continued to do so for three months thereafter.” (Maj. opn., ante, at p. 377.) Apparently, this makes the order unconstitutional in the view of the majority, though they never explain why this is so.
The majority’s unspoken assumption is that a tenant who has withheld rent will be unwilling or unable to satisfy a judgment ordering the repayment of the withheld rent. Since the landlord may be faced with a judgment-proof opponent, they conclude that the landlord has not had adequate judicial review. They provide no authority for this view. The fact that one may not be able to collect on a judgment does not mean that one has not had access to the courts. Many litigants take this risk; it is not a risk with constitutional significance.
The narrow holding of this case is only that the Board’s order was unconstitutional because it did not allow the landlord sufficient time to seek
The majority explain that the Board can avoid the constitutional problem by regularly staying enforcement of its orders for a period of time sufficient to allow an aggrieved party to seek a stay from the superior court. (Maj. opn., ante, at p. 377, fn. 44.) As the facts of the present case demonstrate, such a stay would normally be unnecessary. Since a Board order authorizing withholding of rent authorizes a future act, it may be effective immediately in the sense that the aggrieved party can immediately seek review of the order, but it is not enforceable in the sense that the tenant can immediately do anything unless the order is filed the day the rent is due. Furthermore, even a stay which is sought after the effective date of an order may undo the order and require remedial action pending judicial review. (See Cal. Administrative Mandamus (Cont.Ed.Bar 1966) § 10.8, p. 178.) Thus the status quo ante may be preserved even if the stay is sought and granted after the order became effective. For example, in this very case, once the landlord did request a stay, the court granted one, adding an order to the tenant to pay the withheld rent, retroactive to April 1, into a trust account held by the landlord’s attorney, until the matter had been finally adjudicated in court. The landlord then had unimpaired judicial review and no practical obstacle to enforcing a judgment in his favor.
The majority say that this decision applies only to these facts, and has no effect on other administrative orders having immediate effect, “including immediately effective restitutive orders issued by professional licensing boards.” (Maj. opn., ante, at p. 377, fn. 44.) Yet they provide no basis for distinguishing this case from others in which an immediately effective order is available.
It is established that an agency has the authority to make its orders effective immediately. (Hohreiter v. Garrison (1947)
Although the majority have no desire to do so, their opinion casts into doubt whether administrative agencies may ever order any act to be done before judicial review or a stay is available. For the purpose of effective judicial review, there is no distinction between an immediately effective order suspending or revoking a license or requiring a licensee to reimburse a sum of money, an order requiring a polluter to cease and desist, and an order authorizing the withholding of rent. I fear that this opinion unwittingly will call into question the legitimacy of administrative action which is widespread and necessary for the protection of the public.
The petition of respondent McHugh for a rehearing was denied November 1, 1989.