ROBERT OLIVA, an Incompetent Person, etc., et al., Plaintiffs and Respondents, v. DAVID B. SWOAP, as Director, etc., Defendant and Appellant.
Civ. No. 14455
Third Dist.
June 15, 1976
59 Cal. App. 3d 130
Evelle J. Younger, Attorney General, Elizabeth Palmer, Assistant Attorney General, N. Eugene Hill, John Fourt and James D. Claytor, Deputy Attorneys General, for Defendant and Appellant.
Clifford Sweet, F. Hayden Curry, Mary H. Mocine, Gary J. Grimm, Eric P. Gold, Jay Eisen and Ralph Santiago Abascal for Plaintiffs and Respondents.
PUGLIA, P. J.-Robert Oliva, an adult incompetent, by Villa F. Oliva, his guardian ad litem, and Catherine Sargent, on behalf of themselves and a class of persons similarly situated (hereinafter “plaintiffs“), filed this action in Sacramento Superior Court for writ of mandate, injunction and declaratory relief. They pray that defendant, the Director of the State Department of Social Welfare (hereinafter “Department“),1 be prohibited from reducing current grants to welfare recipients who have fully reported all facts material to an accurate determination of their grants in order to recover overpayments caused by county administrative errors. This practice is referred to as “grant adjustment.”
The trial court granted plaintiffs’ motion for summary judgment, declaring the use of grant adjustments to recoup such overpayments contrary to law and void, and permanently enjoining defendant from using, and directing defendant to discontinue, the grant adjustment method in such cases. Defendant appeals, contending (1) that plaintiffs failed first to exhaust their administrative remedies, and (2) that
Plaintiffs represent themselves and a class of persons who receive cash grants under public assistance programs. At the time the action was commenced, these programs included aid to the disabled (former § 13500 et seq.), aid to the blind (former § 12500 et seq.), old age security (former § 12000 et seq.) and aid to families with dependent children (§ 11200 et seq.).3 Between June 1971 and March 1973, plaintiff Oliva, a resident of Alameda County receiving aid to the disabled cash grants,
Both named plaintiffs were notified by their respective counties that future monthly grants would be reduced to make up for these erroneous overpayments. Both plaintiffs thereupon individually requested an administrative hearing as provided for in sections 10950-10965. Decisions adverse to plaintiffs were entered by the defendant director on March 8, 1973, in Oliva‘s case and on November 22, 1972, in Sargent‘s case. Both decisions authorized the counties involved to offset the past overpayments as to which there had been full reporting by reductions in future cash grants over a period of six months.4 Neither named plaintiff has sought judicial review of the adverse administrative decision. While their administrative hearings were pending and before the director‘s decisions noted above were entered, the instant proceeding was commenced.
I.
A recipient of welfare benefits who is dissatisfied with any action of the county relating to his receipt of aid may obtain a “fair hearing” before a referee employed by the Department. (§§ 10950, 10953.) After receiving the referee‘s proposed decision, the director may adopt it (§ 10959) or may make an independent determination based on the hearing record. (§§ 10959-10961.) Section 10962 permits the recipient to seek judicial review of the director‘s final decision by a proceeding in administrative mandamus (Code Civ. Proc., § 1094.5).
Plaintiffs commenced these proceedings prior to the administrative determinations in their respective cases. Defendant argues that plaintiffs thereby failed to exhaust their administrative remedies and are foreclosed by the administrative determinations against them which, in the absence of a proceeding for judicial review, become final one year after entry. (§ 10962.)
However, in Ramos v. County of Madera (1971) 4 Cal.3d 685 [94 Cal.Rptr. 421, 484 P.2d 93], the Court formulated a refinement of the doctrine of exhaustion of administrative remedies where class relief is sought in cases otherwise controlled by the procedures set forth in sections 10950-10965. In the Ramos case, plaintiffs, recipients of welfare aid, in behalf of themselves and a class similarly situated, sought injunctive and declaratory relief, as well as damages for the individually named plaintiffs for tortious acts allegedly committed by county welfare officials. The complaint was filed before the final determination of the administrative hearing requested by the named plaintiffs to contest termination of their welfare benefits. The Supreme Court pointed out that the procedure for hearing contained in sections 10950-10965 “is premised on an individualized treatment of claims for aid. . . . In no section of this chapter (Welf. & Inst. Code, §§ 10950-10965) is there provision for class relief. It is the individual who must apply for a hearing, regarding his application for or receipt of aid. He must do so in person or through an authorized representative. It is clear that the hearing scheme established by the Legislature does not contemplate class actions.” (Original italics.) (Ramos v. County of Madera, supra, at pp. 690-691.) The Court concluded that there was “no failure to exhaust an administrative remedy for class relief, for no such administrative remedy existed.” (Original italics.) (Ibid.)
As in the Ramos case, the plaintiffs do not seek in this action to secure payment of welfare benefits. Rather, they seek declaratory and injunctive relief and mandate in order to establish the illegality of grant adjustments and to prohibit continued resort to that method of recouping overpayments due to administrative error where the recipient has fully reported. The provisions for hearing contained in the Welfare and Institutions Code do not provide for the relief sought by these plaintiffs. “Sections 10957 and 10961 refer merely to decisions by the department that a particular applicant is entitled to services or financial aid. Section 10963 requires the county welfare director to ‘comply with and execute’ such decisions, but they have no binding effect on the rights of future
Accordingly, we conclude that the doctrine of exhaustion of administrative remedies is not applicable here and thus is not a jurisdictional bar to this action.
II.
Absent a statute so declaring, a recipient of public assistance is not liable for reimbursement of the state or county for welfare aid properly paid. (Ogdon v. Workmen‘s Comp. Appeals Bd. (1974) 11 Cal.3d 192, 199-200 [113 Cal.Rptr. 206, 520 P.2d 1022]; Webb v. Swoap (1974) 40 Cal.App.3d 191, 195 [114 Cal.Rptr. 897].) The Department has adopted regulations authorizing counties to use the grant adjustment method to recoup money paid erroneously through county administrative error even though the recipient has fully met his reporting responsibilities.5 These regulations were promulgated under the director‘s statutory authority, consistent with the law fixing standards for the administration of public social services (§ 10604), “to implement, interpret, or make specific the law enforced by the department” (§ 10554) through “regulations . . . affecting the purposes, responsibilities, and jurisdiction of the department” (§ 10553).
“It is well established that administrative regulations must conform to applicable legislative provisions, and that an administrative agency has no discretion to exceed the authority conferred upon it by statute.” (California Welfare Rights Organization v. Brian (1974) 11 Cal.3d 237, 242 [113 Cal.Rptr. 154, 520 P.2d 970].) The parties disagree as to the existence vel non of statutory authority for the grant adjustment method of recoupment contained in the regulations of the department. Both sides to this action rest their respective arguments on
The dispute focuses upon the exception in subdivision (c) of section 11004 permitting the county “to adjust any errors or changes in amount of grant resulting from changes in income or need which occur too late to be reflected in the grant for the current month.” The defendant contends the quoted language creates two distinct factual categories in which overpayments are collectible where reporting responsibilities have been satisfied by the recipient. It is argued that the first category consists of overpayments due to “any errors” and includes county administrative error such as occurred here; the second discrete category consists of “changes in amount of grant resulting from changes in income or need” occurring too late to be reflected in the current grant.
It is a well established rule of statutory construction that “relative or modifying phrases are to be applied to the words immediately preceding them and are not to be construed as extending to more remote phrases” (People v. Baker (1968) 69 Cal.2d 44, 46 [69 Cal.Rptr. 595, 442 P.2d 675]; People v. Cruz (1974) 12 Cal.3d 562, 566 [116 Cal.Rptr. 242, 526 P.2d 250]), “unless the context or the evident meaning of the statute requires a different construction.” (Elbert, Ltd. v. Gross (1953) 41 Cal.2d 322, 326-327 [260 P.2d 35].)
Applying the rule just quoted, we conclude that the interpretation of section 11004 advanced by defendant is correct, harmonizing as it does the various parts of the section. In that connection we observe that the right to recover overpayments from fully reporting recipients is circumscribed by safeguards designed to insure that the recipient will not thereby be deprived of subsistence (§ 11004, subd. (e), fn. 6, ante, p. 137), and furthermore must be effected, if at all, within a period of six months (§ 11004, subd. (c)). These limitations are consistent with one objective of the statute, set forth in the preamble to section 11004, requiring that public assistance programs be administered “fairly . . . with due
The grant adjustment procedure employed herein pursuant to regulations adopted by the Department is clearly authorized by statute. Accordingly, the trial court erred in granting plaintiffs’ motion for summary judgment.
The judgment is reversed.
Paras, J., concurred.
FRIEDMAN, J.---I concur. I am not convinced that the court‘s syntactical analysis of section 11004, subdivision (c), reflects the Legislature‘s objective. The statute‘s phraseology is ambiguous; has been on the books during a decade of welfare controversy; has engendered uncertainty and upset affecting administrators and recipients; has stimulated incessant lawsuits and judicial involvement; has never stimulated legislative clarification. The interpretation sought by plaintiffs is no better than that asserted by the department. I would sustain the department‘s regulation on the theory that it represents one of several available interpretations of a murky statute. (Ralphs Grocery Co. v. Reimel 69 Cal.2d 172, 176 [70 Cal.Rptr. 407, 444 P.2d 79].)
A petition for a rehearing was denied July 9, 1976, and respondents’ petition for a hearing by the Supreme Court was denied August 26, 1976. Tobriner, J., and Mosk, J., were of the opinion that the petition should be granted.