Lead Opinion
Opinion
Plaintiff Patricia M. Palmer sued the Regents of the University of California (the Regents) in a common law action for wrongful termination in violation of public policy without first pursuing University of California grievance procedures expressly created to protect employees like Palmer who claim to be victims of retaliation for reporting improper activities. The trial court granted the Regents’ motion for summary judgment based on Palmer’s failure to exhaust the internal remedies available to her. We affirm.
Factual and Procedural Background
1. Palmer’s Termination and Her Complaint for Wrongful Discharge
Palmer was employed for 21 years as a clinical laboratory technologist at the UCLA Medical Center’s Department of Pathology and Laboratory Medicine. In January 1997 the department announced a major restructuring. Palmer and a number of her
A committee established to select employees to whom permanent positions would be offered after the restructuring interviewed Palmer but did not offer her a job because, according to the chair of the committee, “there were other, better qualified applicants for the positions available.” However, Palmer was hired as a temporary clinical laboratory technologist in a position that terminated in December 1997. Palmer was told her “knowledge and ability qualify you [for] this position.”
Palmer brought this action against the Regents, alleging wrongful discharge in violation
2. The Regents ’ First Motion for Summary Judgment
The trial court granted the Regents’ initial motion for summary judgment, construing Palmer’s complaint as limited to a cause of action for discharge in violation of Labor Code section 1102.5, subdivision (b), which prohibits an employer from retaliating against an employee who reports the violation of a federal or state statue or regulation to “a government or law enforcement agency.” The trial court concluded that reports of violations to the employer itself are not protected under Labor Code section 1102.5 and that, in any event, the Regents had presented evidence of a proper basis for Palmer’s termination. We reversed in an unpublished opinion (Palmer v. Regents of the University of California (Mar. 5, 2001, B138553)), holding that Palmer had stated a “classic” common law cause of action for discharge in violation of public policy under Tameny v. Atlantic Richfield Co. (1980)
3. The Second Summary Judgment Motion: Failure to Exhaust Internal Grievance Procedures
On remand the Regents again moved for summary judgment, asserting that Palmer was required to exhaust available internal grievance procedures before bringing her wrongful discharge action. The Regents explained Palmer had available both the general employee grievance ^procedure described in the complaint resolution section of the pamphlet entitled Personnel Policies for Staff Members (PPSM) and the more specific internal grievance process involving retaliation for reporting improper activities, outlined in the document, UCLA Procedures for Reporting Whistle Blowing Complaints. Although Palmer did file a grievance under the PPSM alleging discrimination based on age, race and sex, as well as retaliation for her participation in union organizational activities, she abandoned that grievance before it was finally resolved. No internal complaint or grievance was ever filed claiming she was the victim of retaliation for reporting unlawful activity at UCLA.
Palmer responded to the motion by arguing exhaustion of administrative remedies is not a valid affirmative defense to a common law cause of action for wrongful discharge in violation of public policy. She did not contend the Regents’ internal grievance procedures are inadequate for adjudication of her claim of wrongful termination.
The trial court once again granted the Regents’ motion for summary judgment, agreeing with the Regents that Palmer was required to pursue internal grievance procedures before filing her lawsuit. Palmer filed a timely notice of appeal.
Discussion
1. Palmer’s Failure to Exhaust Internal Grievance Procedures Precludes Her Civil Action for Wrongful Termination
In Westlake Community Hosp. v. Superior Court (1976)
The difference between Westlake, where exhaustion was required, and Rojo and Stevenson, where it was not, is that Westlake involved the use of internal grievance procedures, made available to an employee or member by the organization itself. (See, e.g., Rojo, supra,
Although Westlake involved exhaustion of internal grievance procedures maintained by a voluntary private association (Westlake, supra,
As made plain by Rojo’s expansive definition of the “context” in which the doctrine properly applies, the rationale for Westlake’s exhaustion requirement is not the existence of a contractual relationship between the plaintiff and the defendant entity. Indeed, the Supreme Court specifically rejected that notion when it recognized that the exhaustion doctrine was equally applicable to an applicant for membership who has been denied admission to the organization and an individual whose membership has been revoked. (Westlake, supra,
The “ ‘context’ to which Westlake properly applies” is precisely the situation now before this court. As was true in Westlake, plaintiff Patricia Palmer had available to her internal grievance procedures that, if used, could have eliminated or at least minimized any injury she has
2. The Primary Jurisdiction Doctrine Has No Application to the Requirement That Internal Grievance Procedures Be Utilized Before a Civil Action Is Initiated
As the Supreme Court noted in Rojo, supra,
The primary jurisdiction doctrine obligates a litigant to apply to an outside regulatory agency (for example, the state Insurance Commissioner, the Federal Communications Commission or the Civil Aeronautics Board) for relief before pursuing a civil action. It, like the closely related doctrine of exhaustion of external administrative remedies, arises in the context of complex regulatory schemes utilizing expert administrative agencies. Both doctrines are, in the words of the Supreme Court, “ ‘essentially doctrines of comity between courts and agencies. They are two sides of the timing coin: Each determines whether an action may be brought in a court or whether an agency proceeding, or further agency proceeding, is necessary.’ [Citation.]” (Farmers Ins. Exchange v. Superior Court, supra,
Justice Frankfurter authored the classic statement of the principles underlying the primary jurisdiction doctrine in Far East Confer. v. United States (1952)
The dissent is correct that cases alleging wrongful termination in violation of public policy typically do not involve issues of such a complex or technical nature that the doctrine of primary jurisdiction is properly invoked, and the Regents does not argue to the contrary. But very different policy considerations support the requirement that an employee pursue to completion internal grievance procedures before initiating a lawsuit concerning an adverse employment decision—principally, the desire to provide an opportunity for the employer {not an outside administrative agency) to quickly and efficiently redress a grievance and thereby minimize or even eliminate injury to the plaintiff. (Westlake, supra,
3. Section 8547.10 Requires Exhaustion of the Regents’ Internal Grievance Procedures
The policy underlying section 8547.10, part of the California Whistleblower Protection Act, reinforces the propriety of applying the West-lake doctrine to preclude Palmer’s action against the Regents for wrongful termination without first exhausting the university’s internal grievance procedures. Section 8547.10, subdivision (c), specifically applicable to employees of the University of California, provides, “[A]ny person who intentionally engages in acts of reprisal, retaliation, threats, coercion, or similar acts against a university employee, including an officer or faculty member, or applicant for
The manual, UCLA Procedures for Reporting Whistle Blowing Complaints, contains the UCLA campus procedures for implementing the university’s responsibilities under section 8547.10.
Although section 8547.10, subdivision (f), added to the statute after Palmer filed her lawsuit against the Regents, expressly preserves an employee’s remedies under any other state law,
Because this court previously concluded Palmer had stated a common law cause of action for wrongful discharge in violation of public policy,
Disposition
The judgment is affirmed. Respondent The Regents of the University of California is to recover its costs on appeal.
Woods, J., concurred.
Notes
All statutory references are to the Government Code unless otherwise indicated.
The dissent’s distinction of Edgren v. Regents of University of California, supra,
Because Palmer did not pursue to completion the grievance procedures available to her under either the PPSM or the UCLA procedures for reporting whistleblowing complaints, it is unnecessary for us to consider whether she was required to exhaust both internal remedies before filing her lawsuit. That issue is currently pending before the Supreme Court. (Schifando v. City of Los Angeles (2002)
This confusion is exemplified by the dissent’s discussion of the Supreme Court’s purported analysis of “the principles underlying the doctrine of primary jurisdiction” in Westlake, supra,
The dissent correctly notes that in Farmers Ins. Exchange v. Superior Court, supra,
Section 8547.10, subdivision (a) provides: “(a) A University of California employee, including an officer or faculty member, or applicant for employment may file a written complaint with his or her supervisor or manager, or with any other university officer designated for that purpose" by the regents, alleging actual or attempted acts of reprisal, retaliation, threats, coercion, or similar improper acts for having made a protected disclosure, together with a sworn statement that the contents of the written complaint are true, or are believed by the affiant to be true, under penalty of perjury. The complaint shall be filed within 12 months of the most recent act of reprisal complained about.”
The Supreme Court is currently considering whether a plaintiff must exhaust an internal administrative remedy provided by a public employer before filing an action under the False Claims Act (Gov. Code, § 12653) or for violation of Labor Code section 1102.5, which bars an employer from retaliating “against an employee for disclosing information to a government or law enforcement agency, where the employee has reasonable cause to believe that the information discloses a violation of state or federal statue, or violation or noncompliance with a state or federal regulation.” (Campbell v. Regents of University of California (Dec. 23, 2002, A097560) [nonpub. opn.], review granted Mar. 19, 2003, S113275.) Unlike Government Code section 8547.10, however, neither of the statutory provisions at issue in Campbell contains an express exhaustion requirement.
On December 18, 1989, the office of the president of the University of California issued its Policy for Reporting Improper Governmental Activities and Protection Against Retaliation for Reporting Improper Activities, effective January 1, 1990, to enforce the university’s responsibilities under former section 10550, the predecessor to section 8547.10. The UCLA manual was prepared and issued pursuant to that policy statement.
Subdivision (f) was added to section 8547.10 by Statutes 1999, chapter 673, section 7, effective January 1, 2000. Subdivision (f) provides: “Nothing in this article shall be deemed to diminish the rights, privileges, or remedies of any employee under any other federal or state law or under any employment contract or collective bargaining agreement.”
An injured party’s recovery under this section may include punitive damages and reasonable attorney fees. (§ 8547.10, subd. (c).) In addition, unlike claims under FEHA or for the common law tort of wrongful termination in violation of public policy (see Reno v. Baird (1998)
Under the law of the case doctrine, “a matter adjudicated on a prior appeal normally will not be relitigated on a subsequent appeal in the same case.” (Davies v. Krasna (1975)
Dissenting Opinion
I respectfully dissent.
The issue before us is whether the plaintiff in a common law action for wrongful discharge in violation of public policy should be judicially required to resort to her employer’s internal grievance procedure when no statute, contractual provision, or pertinent public policy requires her to do so.
Under section 70 of the Regents’ Personnel Policies for Staff Members (PPSM), an employee may complain of “a specific management act which is alleged to have adversely affected the employee’s existing terms or conditions of employment” or a management action which violates a provision of the PPSM. Accompanying these two types of complaints is a detailed internal review and appeal process. The PPSM contains a policy against “reprisal or intimidation due to disclosure of improper governmental activities,” i.e., whistleblowing.
In addition to the PPSM, the UCLA manual on Procedures for Reporting Whistle Blowing Complaints (UCLA Procedures) contains its own detailed remedial scheme for employees “alleging threatened or actual interference or retaliation resulting from the reporting of improper activities.” The latter scheme involves a confidential complaint process and the enlistment of a “whistleblowing adviser.”
The crux of the Regents’ argument is that the PPSM and the UCLA Procedures contain administrative and internal remedies which must be exhausted before an aggrieved employee may sue in court over an alleged wrongful termination. It is not clear from the Regents’ brief whether they believe Patricia A. Palmer was required to exhaust one or both of these internal grievance procedures before filing suit for wrongful discharge in violation of public policy.
For her part, Palmer does not contend the Regents’ internal grievance procedures are unavailable or inadequate for adjudicating a claim of wrongful discharge in violation of public policy. Rather, she contends these internal procedures are options afforded to university employees who may or may not elect to make use of them in pursuing a claim for wrongful termination.
California courts have long recognized “where a statutory remedy is provided for a preexisting common law right, the newer remedy is generally considered to be cumulative, and the older remedy may be pursued at the plaintiffs election.”
While the public policy violated in a common law wrongful termination cause of action must be “tethered to” a constitutional or statutory provision, the cause of action itself is a judicially recognized common law cause of action which precedes the Regents’ whistleblower policy by several decades.
I recognize that in certain situations courts have held an employee alleging wrongful termination must exhaust available administrative remedies or internal grievance procedures before seeking tort damages in court. This exhaustion requirement applies, for example, when the employee alleges a statutory cause of action and the statute contains an administrative remedy;
None of these grounds for requiring exhaustion of internal remedies apply here. Palmer is not asserting a statutory cause of action or one founded on the PPSM or UCLA Procedures. I have searched the record for any evidence of a collective bargaining agreement or employment contract which would require Palmer to exhaust the Regents’ internal grievance procedures and have found none.
The Regents offer three reasons why Palmer was required to exhaust their internal grievance procedures.
They principally rely on the Westlake Community Hosp. line of cases,
Westlake was not an employment case and was not decided on employment law principles. It was a case involving admission to a private hospital medical staff and was decided on principles of law pertaining to private voluntary associations.
The exhaustion issue in Westlake arose in the context of the plaintiff doctor’s suit against a codefendant, Los Robles Hospital, for damages resulting from denial of hospital staff privileges. The Westlake defendants moved for summary judgment on the ground the plaintiff had not exhausted Los Robles’ internal grievance procedure.
In reaching its holding in Westlake, the Supreme Court concluded the principles underlying the doctrine of primary jurisdiction require a doctor challenging her exclusion from staff privileges at a private hospital to resort to the hospital’s internal grievance procedures even though the doctor had no contractual or statutory obligation to do so. The Regents contend the trial court here properly followed Westlake in holding Palmer was required to submit her wrongful termination claim to the Regents’ grievance procedure. They point to Edgren v. Regents of University of California, which reached a similar conclusion with respect to a university employee who did not exhaust the Regents’ grievance procedure in challenging his termination from employment.
The doctrine of primary jurisdiction comes into play when claims are originally cognizable in judicial forums and in nonjudicial forums, usually administrative agencies, and raises issues “ ‘within the special competence of an administrative body.’ ”
The doctrine of primary jurisdiction differs from the doctrine of exhaustion of administrative remedies in that “ ‘Exhaustion applies where an agency alone has exclusive jurisdiction over a case; primary jurisdiction where both a court and an agency have the legal capacity to deal with the matter.’ ”
Despite the “considerable flexibility” afforded the courts in applying the primary jurisdiction doctrine,
In Westlake the facts showed the plaintiffs application for staff privileges at Los Robles Hospital was considered by the hospital’s medical committee which conducted an independent investigation of her qualifications. The committee’s decision to deny the application was reviewed by the medical executive committee and the hospital’s board of directors.
In contrast to Westlake, the Supreme Court in Rojo v. Kliger held resort to the FEHA was unnecessary before a plaintiff could proceed with a civil suit based on common law claims for damages resulting from sex discrimination in employment.
Even assuming for the sake of argument the Regents’ protection for whistleblowers constitutes a “pervasive and self-contained system of administrative procedure,” this case does not meet the second prong of the test for primary jurisdiction because the factual issues in a case involving wrongful termination in violation of public policy are not “of a complex or technical nature beyond the usual competence of the judicial system.”
Edgren, on which the Regents also rely, is distinguishable as well. Edgren, the University of California’s principal architect, was laid off for alleged “ ‘budgetary reasons.’ ” He initiated a grievance proceeding but later abandoned it. In his complaint Edgren claimed the Regents engaged in fraud and failed to follow their own personnel policies in effectuating his layoff and in conducting his grievance hearing “all of which resulted in a breach of his employment contract.”
Edgren is not on point for several reasons. Edgren was essentially a breach of contract action in which the plaintiff claimed some ancillary tort damages. It was not a common law tort action for wrongful termination as is the case before us. Furthermore, it is apparent from the allegations in Edgren’s complaint that, unlike Palmer, he had a contractual relationship with the Regents which included an obligation to pursue an internal grievance procedure.
In summary, I would hold an employee alleging a common law cause of action for wrongful termination of employment is not required to first resort to her employer’s internal grievance procedure unless she is contractually or statutorily obligated to do so or the trial court determines in the exercise of its discretion resort to the employer’s administrative remedy would be consistent with the principles underlying the doctrine of primary jurisdiction.
Having determined neither a contractual obligation nor the principles of primary
In an argument not raised by the Regents, the majority maintains the California Whistleblower Protection Act (CWPA)
Section 8547.10, specifically applicable to University of California employees, provides in subdivision (c) “[A]ny person who intentionally engages in acts of reprisal, retaliation, threats, coercion, or similar acts against a university employee ... for having made a protected disclosure shall be liable in an action for damages brought against him or her by the injured party .... However, any action for damages shall not be available to the injured party unless the injured party has first filed a complaint with the university officer identified pursuant to subdivision (a), and the university has failed to reach a decision regarding that complaint within the time limits established for that purpose by the regents.”
If Palmer was pursuing a statutory cause of action under section 8547.10, subdivision (c), I would agree she had to first exhaust the administrative remedy referred to in the statute
This conclusion is bolstered by the fact the internal remedy the Regents claim must be exhausted was created to enforce the university’s responsibilities under subdivision (a) of section 8547.10,
Finally, the Regents contend even if Palmer is not contractually or statutorily bound to exhaust its internal grievance
I agree the exhaustion doctrine may serve important functions in some circumstances. Among other things, it permits the organization to resolve factual issues and apply its expertise in its rules and regulations to the dispute. It usually affords a less formal and more economical forum to resolve disputes and mitigate damages. And, even if the dispute is not finally resolved at the grievance stage, the above mentioned factors may still promote judicial economy in handling the dispute once it reaches court.
Of course, it is one thing to agree exhaustion of internal remedies is a socially beneficial policy and quite another thing to judicially impose such a policy on an employment relationship in which the parties theoretically could have agreed to it, but did not. Courts interpret contracts for the parties, they do not make them. To paraphrase an observation frequently made with respect to arbitration, the policy favoring exhaustion of administrative remedies cannot displace the necessity for a voluntary agreement to submit to administrative remedies.
The absence of any agreement by Palmer to submit her wrongful termination claim to the Regents’ grievance procedure is particularly troubling because requiring Palmer to exhaust the Regents’ internal remedies may prevent Palmer from ever obtaining a jury trial on her tort cause of action for wrongful discharge in violation of public policy. If Palmer submits her wrongful termination claim to the grievance procedure and loses she cannot sue the Regents for wrongful termination even though she has exhausted her administrative remedy. She would first have to bring and win an action for administrative mandamus overturning the grievance decision against her.
One final observation: Although the Regents obviously approve of imposing an exhaustion requirement in this case, neither the Regents nor the majority suggest
For the reasons explained above, in my view, the trial court erred in granting the Regents’ motion for summary judgment based on failure to exhaust internal remedies.
Appellant’s petition for review by the Supreme Court was denied July 9, 2003. George, C. J., and Brown, J., did not participate therein. Kennard, J., was of the opinion that the petition should be granted.
Our Supreme Court has agreed to resolve a similar issue in Campbell v. Regents of University of California (Dec. 23, 2002, A097560) (nonpub. opn.), review granted March 19, 2003, S113275. The issue before the Court of Appeal in Campbell was whether a university employee must exhaust an internal administrative remedy provided by the Regents before filing an action under the False Claims Act (Gov. Code, § 12653) or the whistleblower protection provisions of Labor Code section 1102.5 and was decided in favor of the Regents.
Rojo v. Kliger (1990)
Tameny v. Atlantic Richfield Co. (1980)
Compare Green v. Ralee Engineering Co. (1998)
Indeed, as I explain below, the Legislature has explicitly made this general rule applicable to university whistleblowers in Government Code section 8547.10, subdivision (f). (All future statutory references are to the Government Code.)
Romano v. Rockwell Internat., Inc. (1996)
Johnson v. Hydraulic Research & Mfg. Co. (1977)
Armendariz v. Foundation Health Psychcare Services, Inc. (2000)
Rojo v. Kliger, supra, 52 Cal.3d at pages 87-88.
The absence of any contractual agreement by Palmer to exhaust the Regents’ internal grievance procedures is particularly significant because, as explained below, participation in the grievance procedure may prevent Palmer from ever obtaining a jury trial on her wrongful termination action. See discussion, post, at pages 919-920.
See discussion of section 8547.10, post, at pages 918-919.
Westlake Community Hosp. v. Superior Court (1976)
Edgren v. Regents of University of California (1984)
Westlake, supra,
Westlake, supra,
Westlake, supra,
Westlake, supra,
Westlake, supra,
Edgren, supra, 158 Cal.App.3d at pages 521-522.
Farmers Ins. Exchange v. Superior Court (1992)
See, e.g., Rogers v. Columbia/HCA of Central Louisiana, Inc. (W.D.La. 1997)
Farmers Ins. Exchange, supra, 2 Cal.4th at pages 390-391.
Farmers Ins. Exchange, supra,
Farmers Ins. Exchange, supra, 2 Cal.4th at page 391.
Farmers Ins. Exchange, supra, 2 Cal.4th at page 391.
Farmers Ins. Exchange, supra, 2 Cal.4th at page 391 and footnote 9.
South Bay Creditors Trust v. General Motors Acceptance Corp. (1999)
Farmers Ins. Exchange, supra, 2 Cal.4th at page 392.
Rojo v. Kliger, supra, 52 Cal.3d at page 87, citation omitted.
Rojo v. Kliger, supra, 52 Cal.3d at page 88.
Westlake, supra,
Westlake, supra, 17 Cal.3d at pages 474, 475-476. See Robinson v. Templar Lodge, I. O. O. F. (1897)
Westlake, supra, 17 Cal.3d at pages 475-476.
Rojo v. Kliger, supra, 52 Cal.3d at pages 87-88.
Rojo v. Kliger, supra, 52 Cal.3d at pages 87-88, citation omitted.
Rojo v. Kliger, supra, 52 Cal.3d at page 88.
Rojo v. Kliger, supra, 52 Cal.3d at page 88. In a subsequent decision the court clarified its reference in Rojo to “exhaustion of administrative remedies” when discussing the plaintiffs common law tort remedy. The court explained that although “we referred to ‘exhaustion’ of administrative remedies [in Rojo] we were in fact considering a question of prior resort to administrative procedures under the primary jurisdiction doctrine.” (Farmers Ins. Exchange, supra,
Rojo v. Kliger, supra,
Edgren, supra,
Edgren, supra,
Edgren, supra,
Edgren, supra, 158 Cal.App.3d at pages 521-523.
Sections 8547-8547.12.
Hood v. Hacienda La Puente Unified School Dist., supra, 65 Cal.App.4th at pages 440-441.
Senate Committee on Public Employment and Retirement, Report on Senate Bill No. 951 (1999-2000 Reg. Sess.) page 3; Assembly Committee on Public Employees, Retirement and Social Security, Report on Senate Bill No. 951 (1999-2000 Reg. Sess.) page 2.
See Stevenson v. Superior Court (1997)
Formerly section 10550, subdivision (a). (Stats. 1988, ch. 1385, § 3, p. 4668.)
Section 8547.10, subdivision (f), quoted ante.
Majority opinion, ante, at page 905.
See Rojo v. Kliger, supra,
See Lagatree v. Luce, Forward, Hamilton & Scripps (1999)
Johnson v. City of Loma Linda (2000)
See Apte v. Regents of University of California (1988)
See Madden v. Kaiser Foundation Hospitals (1976)
Blanton v. Womancare, Inc. (1985)
See Badie v. Bank of America (1998)