THE PEOPLE, Plaintiff and Respondent, v. CATHY DAWN GARCIA, Defendant and Appellant.
No. S124090
Supreme Court of California
Aug. 28, 2006.
39 Cal. 4th 1070
[No. S124090. Aug. 28, 2006.]
THE PEOPLE, Plaintiff and Respondent, v. CATHY DAWN GARCIA, Defendant and Appellant.
COUNSEL
Elizabeth M. Campbell, under appointment by the Supreme Court, and Sally P. Brajevich, under appointment by the Court of Appeal, for Defendant and Appellant.
Legal Services of Northern California, Gary F. Smith; Western Center on Law and Poverty, Richard A. Rothschild, Dora Lopez and Robert D. Newman for Legal Aid Association of California as Amici Curiae on behalf of Defendant and Appellant.
Bill Lockyer, Attorney General, Manuel M. Medeiros, State Solicitor General, Robert R. Anderson, Chief Assistant Attorney General, Mary Jo Graves, Assistant Attorney General, Janet E. Neeley, Stephen G. Herndon, Maggy Krell, David Andrew Eldridge, Paul E. O‘Connor, Janis Shank McLean and Donald E. deNicola, Deputy Attorneys General, for Plaintiff and Respondent.
David Labahn; Greg Gibeson, Assistant Deputy District Attorney (Alameda); and Stan Kubochi, Deputy District Attorney (Sacramento) for California District Attorney‘s Association as Amici Curiae on behalf of Plaintiff and Respondent.
OPINION
MORENO, J.— Nearly 25 years
I. FACTUAL AND PROCEDURAL BACKGROUND
Defendant is the mother of four children. She applied for welfare assistance, representing that her household unit consisted of herself and all of her children. A dispute arose over whether defendant‘s two oldest children, both boys, actually were residing in defendant‘s household, or instead were living with their father.
In August 2000, the Butte County Department of Social Welfare (the County) sent defendant several notices of action advising her that she had received $5,839 in welfare benefits between October 1998 and June 2000 to which she was not entitled: $3,669 in cash aid and $2,170 in food stamps. The initial notices explained that “the overpayment was caused by the County,” or alternately that the “County Welfare Department made a mistake,” and also noted that “the wrong household size was used” to calculate the cash aid and
Defendant requested an administrative hearing on the County‘s proposal to recoup the overpayment from her future benefit grants. At this hearing, the County rescinded the notices of action; the matter was dismissed without prejudice on January 30, 2001. Later, the County issued new notices, alleging that the overpayment of cash aid and overissuance of food stamps were caused by defendant‘s failure to report that the two boys were living with their father, which constituted a material change in her household.
In May 2001, an administrative law judge held a hearing to determine “[w]hether the boys were members of the assistance unit and household during the periods in question,” and “[w]hether the overissuance and overpayment were the result of administrative errors or [defendant‘s] failure to report the boys’ absence from her home.” Evidence admitted at the hearing included a county case worker‘s determination that defendant remained eligible for benefits for her sons after she reported in September 1998 that they lived with their father “half of the time.” Evidence, however, also was presented to the contrary: that defendant‘s sons lived with their father during the week, that he had assumed primary responsibility for the care of the two boys since before 1997, and that their longest stay with defendant was for four weeks in the summer of 1999.
In the written decision that followed the administrative hearing, the administrative law judge noted that there were three potential causes of the alleged overpayment: (1) “inadvertent household error,” (2) “administrative error,” and (3) “intentional program violations.” The administrative law judge concluded that the overpayment in this case was “the result of administrative errors of omission committed by the county welfare department,” because the county did not conduct required periodic redetermination reviews and investigations. Therefore the administrative law judge ordered that “[t]he claim is granted in that all the overpayments and overissuances are determined to have been caused by administrative errors. In all other respects, the claim is denied.” Defendant was ordered to repay the excess benefits.
In March 2001, while the administrative proceedings were pending, defendant was charged by felony complaint with fraudulently receiving welfare benefits of over $400 in violation of
After the administrative decision was issued, defendant moved to dismiss the criminal action, arguing that collateral estoppel barred the district attorney from proceeding on criminal charges because the administrative law decision had determined that she had received the excess welfare benefits because of administrative errors by the County. The trial court denied her motion and, following a bench trial, defendant was convicted on both counts.
Defendant appealed. The Court of Appeal reversed the judgment in a published decision, holding that the trial court erred in failing to follow Sims, in which this court held that collateral estoppel bars the
II. DISCUSSION
The People argue that this court should reconsider our decision in People v. Sims, supra, 32 Cal.3d 468 (Sims), in light of intervening changes in the law. In 1982, we addressed in Sims circumstances similar to those in the present case and held that the doctrine of collateral estoppel precluded the People from prosecuting for welfare fraud a welfare recipient who had been exonerated at an administrative hearing conducted by the county. (Id. at p. 489.)
In Sims, the Social Services Department of Sonoma County sought to recoup from June Sims alleged overpayments of aid and food stamps. Sims requested an administrative hearing to challenge the decision. Meanwhile, the district attorney charged Sims with felony welfare fraud under
We began our discussion in Sims by noting that the United States Supreme Court had concluded that “[c]ollateral estoppel may be applied to decisions made by administrative agencies ‘[when] an administrative agency is acting in a judicial capacity and resolves disputed issues of fact properly before it which the parties have had an adequate opportunity to litigate....‘” (Sims, supra, 32 Cal.3d at p. 479, quoting United States v. Utah Constr. Co. (1966) 384 U.S. 394, 422 [16 L.Ed.2d 642, 86 S.Ct. 1545, 176 Ct.Cl. 1391], italics omitted; see also Pacific Lumber Co. v. State Water Resources Control Bd. (2006) 37 Cal.4th 921, 944 [38 Cal.Rptr.3d 220, 126 P.3d 1040] (Pacific Lumber).) We noted that the standard formulated in Utah Construction supports the primary public policy goal underlying the doctrine of collateral estoppel: ” ‘limiting litigation by preventing a party who has had one fair trial on an issue from again drawing it into controversy.’ ” (Sims, supra, at p. 479, quoting Bernhard v. Bank of America (1942) 19 Cal.2d 807, 811 [122 P.2d 892].)
We concluded in Sims that an administrative hearing conducted by the California Department of Social Services (DSS) was “a judicial-like adversary proceeding,” emphasizing that: 1) The hearing was impartial; 2) all testimony was submitted under oath; 3) both parties could call and cross-examine witnesses and introduce documentary evidence; 4) the parties could request that witnesses be subpoenaed; 5) regulations required that a verbatim record of the hearing be made; and 6) a written decision would issue after the hearing. (Sims, supra, 32 Cal.3d at pp. 479-480.) Sims also stressed that the administrative decision
We then considered whether the traditional requirements of collateral estoppel had been satisfied. There are five threshold requirements: 1) the issue to be precluded must be identical to that decided in the prior proceeding; 2) the issue must have been actually litigated at that time; 3) the issue must have been necessarily decided; 4) the decision in the prior proceeding must be final and on the merits; and 5) the party against whom preclusion is sought must be in privity with the party to the former proceeding. (Sims, supra, 32 Cal.3d at p. 484; accord, Pacific Lumber, supra, 37 Cal.4th at p. 943; see also Lucido v. Superior Court (1990) 51 Cal.3d 335, 341 [272 Cal.Rptr. 767, 795 P.2d 1223] (Lucido); Rest.2d Judgments, § 27.)
In examining whether the welfare fraud issue was actually litigated at the administrative hearing, we noted in Sims that the respondent‘s request for an administrative hearing had “properly raised” the welfare fraud issue, that the controversy was submitted for a determination on the merits, and that there was a finding that made “clear that respondent‘s guilt or innocence of welfare fraud was actually litigated at the... fair hearing.” (Sims, supra, 32 Cal.3d at p. 484.)
We also held in Sims that the welfare fraud issue actually litigated in the administrative hearing was “identical to that involved in the criminal proceedings.” (Sims, supra, 32 Cal.3d at p. 485.) After noting that the same amount of overpayments, the same relevant time periods, and the same allegation that Sims had failed to report a change in her household size were at issue in the administrative hearing as in the criminal prosecution, we addressed the fact that different burdens of proof apply at administrative hearings and in criminal prosecutions. Because an administrative hearing is civil in nature, and the county must prove its case by a preponderance of evidence, the burden at the hearing is not as great as the state‘s burden at a criminal proceeding of proving a defendant‘s guilt beyond a reasonable doubt, we concluded that “if the County fails to prove its allegations by a preponderance of the evidence at the fair hearing, it follows a fortiori that it has not satisfied the beyond a reasonable doubt standard.” (Ibid.)
We then held that the administrative law judge‘s decision is “final for purposes of applying collateral estoppel” when the deadline for the welfare department to seek rehearing passes, or upon the finality of any appeals of the administrative hearing decision. (Sims, supra, 32 Cal.3d at pp. 485-486.)
Finally, we concluded in Sims that the county and the district attorney were in privity, as is required for collateral estoppel to apply. Although there is ” ‘no universally applicable definition of privity’ ” (Sims, supra, 32 Cal.3d at p. 486, quoting Lynch v. Glass (1975) 44 Cal.App.3d 943, 947 [119 Cal.Rptr. 139]), we explained that whether
In discussing whether privity existed, we examined the relationship between “the district attorney‘s office, which represents the party to be estopped, and the County, the unsuccessful party in the prior litigation....” (Sims, supra, 32 Cal.3d at p. 487.) Both entities, we noted, are county agencies that are designated by statute to represent the interests of the State of California; just as the district attorney‘s office represents the state in criminal matters (
The Sims decision additionally recognized the “close association between the County and the district attorney‘s office” in cases involving alleged benefit overpayments and welfare fraud. (Sims, supra, 32 Cal.3d at p. 487.) We explained that the district attorney and the county “operate jointly in investigating and controlling welfare fraud,” and that a special unit had been created “to investigate suspected welfare fraud and to function as a liaison between the County and law enforcement agencies.” (Ibid.) We also noted that the county must provide documentary evidence to the district attorney upon request, and that county officials must be available to appear at criminal hearings and trials. The Sims decision also mentioned that “[i]n addition, an attempt by the County to obtain restitution of overpayments made to a welfare recipient suspected of fraud is sufficient to satisfy the mandate of
Having concluded that the traditional requirements of collateral estoppel were satisfied, we then examined whether precluding the district attorney from prosecuting the welfare recipient would further the traditional public policies served by the collateral estoppel doctrine. We noted in Sims that the application of collateral estoppel to bar criminal prosecutions of welfare fraud would further several public policy goals. First, we observed that “[g]iving conclusive effect to the [administrative] decision exonerating respondent of welfare fraud would promote judicial economy by minimizing repetitive litigation.” (Sims, supra, 32 Cal.3d at p. 488; see also Gikas v. Zolin (1993) 6 Cal.4th 841, 849 [25 Cal.Rptr.2d 500, 863 P.2d 745].) Additionally, we expressed concern that, unless the later prosecutions were estopped, the possibility of inconsistent judgments could undermine the integrity of the judicial system as well as the integrity of the administrative hearing process; if a welfare recipient is found in an administrative hearing to have lawfully received welfare benefits, and then is successfully prosecuted in criminal court
The possibility of having to defend the receipt of welfare benefits in two forums also works a hardship on the welfare recipient; if collateral estoppel does not apply, the welfare recipient cannot rely upon success at the administrative hearing because “he or she may still be required to return the benefits” after a criminal prosecution. (Sims, supra, 32 Cal.3d at p. 489 wrongly received welfare benefits, we commented that it would be “manifestly unfair” to subject her to a second proceeding in criminal court “in which she must defend herself against the very same charges of misconduct.” (Ibid.)
As additional support for the conclusion that the application of collateral estoppel would further the public policy considerations served by the doctrine as a whole, we observed that “[i]n addition to the public policy considerations... the uniqueness of the statutory scheme governing prosecutions for [welfare] fraud and the circumstances of the individuals receiving welfare benefits make application of collateral estoppel particularly appropriate....” (Sims, supra, 32 Cal.3d at p. 489.)
Principles of stare decisis present a formidable obstacle to the People‘s request that we reconsider our decision in Sims, which has been the law for nearly 25 years: “It is, of course, a fundamental jurisprudential policy that prior applicable precedent usually must be followed even though the case, if considered anew, might be decided differently by the current justices. This policy, known as the doctrine of stare decisis, ‘is based on the assumption that certainty, predictability and stability in the law are the major objectives of the legal system; i.e., that parties should be able to regulate their conduct and enter into relationships with reasonable assurance of the governing rules of law.’ ” (Moradi-Shalal v. Fireman‘s Fund Ins. Companies (1988) 46 Cal.3d 287, 296 [250 Cal.Rptr. 116, 758 P.2d 58], quoting 9 Witkin, Cal. Procedure (3d ed. 1985) Appeal, § 758, p. 726.) Although we recognize that “reexamination of precedent may become necessary when subsequent developments indicate an earlier decision was unsound, or has become ripe for reconsideration” (Moradi-Shalal, supra, 46 Cal.3d at p. 297), the arguments posed by the People do not convince us that a reexamination of our decision in Sims is warranted.
The People first argue that our decisions subsequent to Sims place in doubt our characterization of the district attorney as essentially a “county agency,” and therefore have undercut our holding in Sims that the district attorney and the county are in privity. This argument is based upon a false premise. Our decision in Sims did not characterize the district attorney as a county agency but, to the contrary, emphasized that the district attorney acts as an agent of the state in prosecuting welfare fraud: “The district attorney‘s office represents the State of California in the name of the ‘People’ at criminal prosecutions.” (Sims, supra, 32 Cal.3d at 487.) It was precisely the district attorney‘s action as a surrogate for the state, combined with the county‘s work as an ” ‘agent’ of the state” (ibid.), that weighed in support of our conclusion that the district
The People further argue that amendments to
In 1984, as part of a reform of the statutes punishing welfare fraud, the Legislature amended
The People argue that the Legislature‘s enactment of the 1984 changes to the
As noted above, the People contend that these statutory changes indicate that the Legislature no longer prefers that cases involving possible welfare fraud be resolved without resort to criminal prosecution, and that such a shift in legislative purpose implicitly overrules this court‘s decision in Sims. We reject this contention for two reasons. Even if the restitution-first requirement indicates a preference for noncriminal resolutions, it does not necessarily follow that the repeal of the requirement evinces a preference for criminal resolutions. Rather, the current statutory scheme instead places the criminal and noncriminal options in equipoise, leaving the County free to obtain restitution before, during, or after instituting criminal proceedings.5
The People argue our subsequent decision in Lucido, supra, 51 Cal.3d 335, demonstrates that the restitution-first requirement was essential to the outcome in Sims. But a careful reading of Lucido leads to the opposite conclusion. The restitution-first requirement was one basis for our decision in Sims, but far from the only grounds for our decision.
In Lucido, we held that the doctrine of collateral estoppel does not bar the People from relitigating in a criminal proceeding an issue on which the defendant had prevailed in a prior probation revocation hearing. (Lucido, supra, 51 Cal.3d at p. 339Lucido, after being convicted of indecent exposure, was sentenced to probation. While on probation, he was charged with a new count of indecent exposure. The People sought to have Lucido‘s probation revoked based upon the indecent exposure, as well as upon the independent ground that Lucido had tested positive for marijuana use. Following a hearing, the court revoked Lucido‘s probation based only upon the marijuana use, and not upon the indecent exposure charge, stating that the prosecution had not produced clear and convincing evidence of the indecent exposure. (Id. at pp. 339-341.)
We held that the state was not collaterally estopped from prosecuting Lucido for indecent exposure, even though the state had failed to prove a violation of probation based on the same conduct. (Lucido, supra, 51 Cal.3d 335, 351.) In so holding, we followed the estoppel framework set forth and applied in Sims, including an analysis of whether the threshold requirements and traditional policy reasons for applying collateral estoppel were satisfied. (Id. at pp. 341-343.)
Our decision in Lucido discussed Sims on two occasions. First, we determined that Sims had not nullified an earlier decision, Chamblin v. Municipal Court (1982) 130 Cal.App.3d 115 [181 Cal.Rptr. 636], in which the Court of Appeal held that findings from a probation revocation hearing did not bar prosecution for Vehicle Code violations, stating: “In Sims we noted that the ‘particular and special circumstances’ presented by the ‘unique statutory scheme’ for resolution of welfare fraud strongly supported a holding that collateral estoppel should apply.” (Lucido, supra, 51 Cal.3d at p. 345, quoting Sims, supra, 32 Cal.3d at pp. 489-490.) As noted above, the hearing in Sims was statutorily required to be held prior to any criminal action on the fraud. (Sims, supra, at p. 475, citing
Having distinguished the decisions in Chamblin and Sims and explained why our decision in Sims had not weakened the Court of Appeal‘s earlier decision in Chamblin, we held in Lucido that our earlier holding in Sims did not require us to apply collateral estoppel in the context of probation revocation hearings because we have applied collateral estoppel to preclude criminal trials “only when compelling public policy considerations outweighed the need for determinations of guilt and innocence to be made in the usual criminal trial setting.” (Lucido, supra, 51 Cal.3d at p. 349Sims did not compel this court to apply collateral estoppel to the probation revocation setting, we observed that “[i]n Sims... we applied collateral estoppel partly on the ground that the ‘unique statutory scheme’ at issue was intended to essentially resolve issues of criminal guilt and innocence in regard to welfare fraud.” (Ibid., italics omitted.)
Missing from each discussion of Sims was any statement or implication that we would have decided Sims differently had the former statutory scheme for resolution of welfare fraud been different. We simply relied upon the unique statutory scheme considered in Sims as a ready means of distinguishing the decision in Chamblin, and observed that the restitution-first requirement and the goal it furthered “supported” our holding in Sims. (Lucido, supra, 51 Cal.3d at p. 345Lucido noted that the Sims court “applied collateral estoppel partly on the ground” that the restitution-first requirement evinced a legislative intent “to essentially resolve issues of criminal guilt” in an administrative setting. (Id. at p. 349, italics added.) The other multiple bases for our decision in Sims remain untouched by our decision in Lucido.
The change in the statutory scheme governing welfare fraud to permit, rather than require, administrative proceedings seeking restitution of welfare benefits prior to criminal prosecution does not alter our conclusion that our decision in Lucido is
Further, we noted in Lucido that the existence of evidentiary rules rendering the probationer‘s testimony at the revocation hearing inadmissible at a subsequent criminal trial “significantly protect[s] probationers from prejudice caused by the juxtaposition of revocation hearings and criminal trials,” and therefore weighed against the application of collateral estoppel. (Lucido, supra, 51 Cal.3d at p. 351Sims. As the People conceded at argument, no similar evidentiary rules prohibit a welfare recipient‘s testimony at an administrative hearing from being introduced at a later criminal trial for welfare fraud.
Finally, different public policy concerns affected the decisions in Sims and Lucido.6 In Lucido, we noted that the probation revocation hearing “arises as a continuing consequence of the probationer‘s original conviction” (Lucido, supra, 51 Cal.3d at p. 348), that any sanction imposed at the hearing stems
from the fact that the probationer has been judged guilty of a prior crime, and that the subject of the revocation hearing
We noted in Lucido that “[p]robation revocation hearings and criminal trials serve different public interests.” (Lucido, supra, 51 Cal.3d at p. 347.) “Probation is a form of leniency which is predicated on the notion that a defendant, by proving his ability to comply with the requirements of the law and certain special conditions imposed upon him, may avoid the more severe sanctions justified by his criminal behavior. Once given the opportunity for lenient treatment the choice is his as to whether he merits being continued on probation.” (People v. Zuniga (1980) 108 Cal.App.3d 739, 743 [166 Cal.Rptr. 549].) We stated in Lucido: “A probation revocation hearing assesses whether conditions relating to punishment for a prior crime have been violated so that probation should be modified or revoked ....” (Lucido, supra, 51 Cal.3d at pp. 347-348Lucido, “a criminal prosecution seeks conviction for wholly new offenses.” (Id. at p. 348.)
Sims differs from Lucido in this respect, because the purposes of administrative proceedings seeking restitution of welfare benefits do not differ greatly from the purposes of criminal prosecution for welfare fraud in obtaining those same benefits. As we noted in Sims, “[t]he County had an adequate opportunity at the fair hearing to prove that respondent had fraudulently obtained welfare benefits. However, [Sims] successfully demonstrated her innocence.” (Sims, supra, 32 Cal.3d at p. 489.)
Our conclusion that Sims remains vital after the 1984 changes to the welfare fraud scheme is supported by the legislative history of those changes, which reveals that the Legislature did not contemplate abrogating Sims, either as a direct or indirect effect of the 1984 statutory changes that resulted in, among other things, removing the restitution-first requirement. “[W]hen, as here, the Legislature undertakes to amend a statute which has been the subject of judicial construction” “it is presumed that the Legislature was fully cognizant of such construction....” (Palos Verdes Faculty Assn. v. Palos Verdes Peninsula Unified Sch. Dist. (1978) 21 Cal.3d 650, 659 [147 Cal.Rptr. 359, 580 P.2d 1155]; see also White v. Ultramar, Inc. (1999) 21 Cal.4th 563, 572 [88 Cal.Rptr.2d 19, 981 P.2d 944]; People v. Davenport (1985) 41 Cal.3d 247, 263, fn. 6 [221 Cal.Rptr. 794, 710 P.2d 861].) Because the Legislature amended the welfare fraud statutes after this court‘s decision in Sims became final, we assume that the Legislature was aware of this court‘s construction of the welfare fraud statutes in that case. Had the Legislature wanted to invalidate Sims, it could have provided that no administrative decision would prevent a prosecution for welfare fraud.
The Legislature has demonstrated the ability, when it so intends, to specify that administrative proceedings will not bar judicial proceedings. For example, the Legislature specifically provided that administrative proceedings before the Department of Motor Vehicles could not have “a preclusive effect on related criminal proceedings.” (Gikas v. Zolin, supra, 6 Cal.4th at p. 851.) The
Finally, the People raise for the first time in their opening brief in this court, the argument that the enactment of Proposition 115 in 1990 compels this court to reconsider our decision in Sims. Among other things, Proposition 115 added to the California Constitution a provision that provides the People of California with the right to “a speedy and public trial.” (
The People thus assert that attendance at administrative hearings related to welfare benefit overpayment ordinarily is limited, but because they raise the issue for the first time before this court, they provide no showing that attendance at the hearing in this particular case was so limited as to render the hearing nonpublic, or that the procedures employed at the hearing in this case render it nonjudicial. Nor do the People cite any persuasive authority supporting their contention that Proposition 115‘s general provision regarding the People‘s right to a speedy and public trial was intended to overrule Sims or to more generally prevent the application of collateral estoppel principles. Indeed, the Sims regime does not foreclose the People from seeking a criminal trial prior to the administrative hearing; the hearing can only estop the issue of welfare fraud if the People do not pursue the criminal option as speedily as the County pursues the matter administratively.
The People also contend that, even if Sims remains vital after the statutory changes described above, collateral estoppel should not act to bar the prosecution of defendant in this particular case, because
As noted above, the first of the traditional requirements of collateral estoppel is that the issue to be precluded must be identical to that decided in the prior proceeding. (Sims, supra, 32 Cal.3d at p. 484.) The Court of Appeal in the present case determined what issues had been litigated in the administrative hearing by considering what issues had been ” ‘properly raised, by the pleadings or otherwise,’ ” and whether those issues had been ” ‘submitted for determination, and determined.’ ” (Ibid.) The Court of Appeal relied upon the fact that “[t]he administrative decision identified the issues subject to determination as (1) whether defendant‘s two sons were members of her household when she received aid on their behalf, and (2) whether she
received relief to which she was not entitled because she “fail[ed] to report the boys’ absence from her home.” ”
At issue in a prosecution for welfare fraud is whether a person has obtained aid for a child not entitled to assistance “by means of false statement or representation or by impersonation or other fraudulent device.” (
The administrative decision concluded that “all the overpayments and overissuances are determined to have been caused by administrative errors.” But this does not foreclose the possibility that defendant misrepresented whether her two sons were members of her household when she received aid on their behalf and failed to report the boys’ absence from her home. The administrative decision that the overpayments were caused by administrative errors leaves open the possibility that defendant made misstatements that were a contributing cause to the overpayments. It is possible that the administrative decision did not determine whether defendant made any misrepresentations, or whether such misrepresentations were a cause, but not the sole cause, of the overpayments. Only if the administrative law judge did indeed find that defendant had made no misrepresentations or omissions in her applications for aid would the state be barred from prosecuting her for welfare fraud; if defendant made no false representations, an element of that crime has not been satisfied. (People v. Carlson (1977) 76 Cal.App.3d 112, 116 [142 Cal.Rptr. 638].)
We decline to determine whether in the present case the People are collaterally estopped from prosecuting defendant for welfare fraud and, instead, remand the case to permit the Court of Appeal to
It is also unclear whether the People are collaterally estopped from prosecuting defendant for perjury. The Court of Appeal decision does not discuss the perjury charge. The elements of perjury are: “a ‘willful statement, under oath, of any material matter which the witness knows to be false.’ ” (Cabe v. Superior Court (1998) 63 Cal.App.4th 732, 735 [74 Cal.Rptr.2d 331]; see also Chein v. Shumsky (2004) 373 F.3d 978, 983.) Again, if the administrative decision actually decided that defendant had made no misstatements, collateral estoppel would bar prosecution of defendant for perjury. However, if defendant willfully made misstatements, but the administrative law judge determined that such misstatements were not the dominant cause of the overpayments, collateral estoppel would not necessarily dispose of the perjury charge, as it is possible that defendant‘s false representation could have been material to the administrative proceeding. (See People v. Kobrin (1995) 11 Cal.4th 416, 426-427 [45 Cal.Rptr.2d 895, 903 P.2d 1027].)
Accordingly, we remand this matter to the Court of Appeal for further proceedings consistent with this opinion, including a determination of whether the issues litigated at the administrative hearing and the criminal prosecution for welfare fraud and perjury were identical.
III. DISPOSITION
For the foregoing reasons, the judgment of the Court of Appeal is reversed; and the matter is remanded to the Court of Appeal for further proceedings consistent with this opinion, including reconsideration of whether the issues litigated at the administrative hearing and the criminal prosecution for welfare fraud and perjury were identical.
George, C. J., Kennard, J., Baxter, J., and Werdegar, J., concurred.
CHIN, J., Concurring and Dissenting. — I agree with the majority that the Court of Appeal‘s judgment must be reversed because the record fails to demonstrate that in resolving the administrative proceedings before the California Department of Social Services, the administrative law judge (ALJ) necessarily determined that defendant Cathy Dawn Garcia did not make misrepresentations or omissions that contributed to her receipt of overpayments. (Maj. opn., ante, at pp. 1089-1090.) However, as explained below, I disagree with the majority‘s decision to remand the case to the Court of Appeal for further consideration of this question. (Maj. opn., ante, at p. 1091.) Because defendant bears the burden of proving her collateral estoppel claim and the record she has provided is insufficient to meet that burden, I would hold that her collateral estoppel claim fails; she simply has not established what the
I also do not join the majority‘s discussion of whether applying collateral estoppel under the circumstances here would be consistent with public policy. The majority is reversing the Court of Appeal‘s judgment because of doubts that collateral estoppel‘s threshold requirements are met in this case. It is therefore both premature and unnecessary to decide whether, assuming the threshold requirements have been met, public policy considerations support collateral estoppel‘s application. Moreover, substantively, I disagree with the majority‘s analysis. In light of statutory developments since People v. Sims (1982) 32 Cal.3d 468 [186 Cal.Rptr. 77, 651 P.2d 321] (Sims), and our post-Sims decisions in Lucido v. Superior Court (1990) 51 Cal.3d 335 [272 Cal.Rptr. 767, 795 P.2d 1223] (Lucido), and Vandenberg v. Superior Court (1999) 21 Cal.4th 815 [88 Cal.Rptr.2d 366, 982 P.2d 229] (Vandenberg), were it necessary to decide the question, I would hold that public policy considerations do not support applying collateral estoppel in this case.
I. DEFENDANT HAS FAILED TO ESTABLISH THE THRESHOLD REQUIREMENTS OF COLLATERAL ESTOPPEL.
As we recently explained, collateral estoppel “applies ‘only if several threshold requirements are fulfilled. First, the issue sought to be precluded from relitigation must be identical to that decided in a former proceeding. Second, this issue must have been actually litigated in the former proceeding. Third, it must have been necessarily decided in the former proceeding. Fourth, the decision in the former proceeding must be final and on the merits. Finally, the party against whom preclusion is sought must be the same as, or in privity with, the party to the former proceeding. [Citations.]’ ” (Pacific Lumber Co. v. State Water Resources Control Bd. (2006) 37 Cal.4th 921, 943 [38 Cal.Rptr.3d 220, 126 P.3d 1040].)
“The party asserting collateral estoppel bears the burden of establishing these [threshold] requirements. [Citation.]” (Lucido, supra, 51 Cal.3d at p. 341.) Because “the law does not favor estoppels” (People v. Frank (1865) 28 Cal. 507, 517 (Frank)), this burden is a heavy one. As we have explained, “[c]ertainty is an essential element of every estoppel . . . .” (Oakland v. Oakland Water Front Co. (1897) 118 Cal. 160, 221 [50 P. 277].) Thus, where a party asserts “a certain question in issue has been litigated and determined between the same parties in a previous action, it is not enough that the proposed evidence tends to show that the precise question may have been involved in such litigation.” (Emerson v. Yosemite Gold Min. etc. Co. (1906) 149 Cal. 50, 57 [85 P. 122].) In other words, ” ‘[e]very estoppel must be certain to every intent, and not to be taken by argument or inference.’ [Citation.] ‘If upon the face of a record anything is left to conjecture as to what was necessarily involved and decided, there is no estoppel in it when pleaded, and nothing conclusive in it when offered in evidence.’ [Citation.]” (Beronio v. Ventura County Lumber Co. (1900) 129 Cal. 232, 236 [61 P. 958].) These rules take on special significance where the decision asserted as an estoppel may have been based on several alternative grounds. ” ‘[I]f it appear[s] that several distinct matters may have been litigated’ ” in the prior action, ” ‘upon one or more of which the judgment may have passed,’ ” unless the record clearly indicates ” ‘which of them was thus litigated, and upon which the judgment was rendered,’ ”
Under these principles, defendant‘s collateral estoppel claim fails. As the majority correctly explains, the ALJ‘s determination here that the overpayments “were caused by administrative errors leaves open the possibility that defendant made misstatements that were a contributing cause to the overpayments.” (Maj. opn., ante, at p. 1090.) Indeed, this is precisely what the trial court concluded in rejecting defendant‘s collateral estoppel claim. Based on the ALJ‘s decision, the trial court concluded that the ALJ‘s “causation finding” simply represents a “qualitative comparison between the things the county did and the things the defendant did” and “does not carry with it an implicit finding that there was no error in reporting.” Supporting this conclusion are the ALJ‘s findings that “[t]he county welfare department was not fully apprised of the actual circumstances surrounding which parent had primary responsibility for the care and control of” defendant‘s children and that “the likelihood of overpayments” would merely have been “diminished” — not eliminated — had the county welfare department properly “reviewed the [children‘s] living arrangement in September 1998.” In light of these findings, the trial court correctly concluded the ALJ made no finding that misstatements by defendant did not contribute to the overpayments.
The majority also correctly explains that the absence in the record of the notices of action “makes it difficult to determine” precisely what issues were before and decided by the ALJ. (Maj. opn., ante, at p. 1090.) Notably, at oral argument, defendant‘s counsel conceded that “it‘s a difficult record to read” because “all” of the information and documents “weren‘t entered into evidence at the criminal trial.” Indeed, in her brief, defendant explains that the only evidence she produced below in support of her collateral estoppel claim was a copy of the ALJ‘s decision. Under the governing law as set forth above, because defendant bears the burden of proving the elements of collateral estoppel, the absence from the record of the notices is her responsibility and the failure of the incomplete record to clarify the scope of the ALJ‘s decision requires rejection of her collateral estoppel claim. (Cf. Vella v. Hudgins (1977) 20 Cal.3d 251, 258 [142 Cal.Rptr. 414, 572 P.2d 28] [rejecting res judicata claim where “sparse record presented . . . fail[ed] to show either the precise nature of the factual issues litigated, or the depth of the court‘s inquiry“].)
I disagree with the majority‘s view that we should remand the case to the Court of Appeal to “consider the effect, if any, of the absences of [the notices of action] from the record . . . .” (Maj. opn., ante, at p. 1090.) As demonstrated above, by placing the burden on the party alleging collateral estoppel to prove with certainty that a particular issue was decided in the prior proceeding, and by rejecting the doctrine‘s application where the record fails to demonstrate which of several potentially dispositive issues the prior decision was based on, our decisions clearly specify “the effect” of the record‘s incompleteness (ibid.): defendant‘s collateral estoppel claim should be rejected. Because the majority correctly concludes that, on the record before us, the ALJ‘s determination leaves open the possibility that “defendant
II. PUBLIC POLICY CONSIDERATIONS DO NOT SUPPORT APPLYING COLLATERAL ESTOPPEL IN THIS CASE.
As explained above, collateral estoppel does not apply if the party asserting it fails to establish several “threshold” requirements. (Lucido, supra, 51 Cal.3d at p. 341.) We also refer to these threshold requirements as “prerequisites.” (Sims, supra, 32 Cal.3d at p. 488.)
However, ” ‘even where the minimal prerequisites’ are established, “policy considerations may limit [collateral estoppel‘s] use where the . . . underpinnings of the doctrine are outweighed by other factors.” ’ [Citations.]” (Vandenberg, supra, 21 Cal.4th at p. 829.) In other words, California‘s collateral estoppel doctrine “has a public policy exception” (People v. Santamaria (1994) 8 Cal.4th 903, 917, fn. 6 [35 Cal.Rptr.2d 624, 884 P.2d 811]) that precludes the doctrine‘s application, even where the threshold requirements are met, if the “policy reasons for applying collateral estoppel” are not “satisfied by the facts of [the] case.” (Sims, supra, 32 Cal.3d at p. 477.)
For several reasons, I do not join the majority‘s discussion of the public policy exception‘s application in this case. Initially, the discussion is both premature and unnecessary. As I have explained, defendant has failed to establish the threshold requirements of her collateral estoppel claim. In reversing the Court of Appeal‘s judgment, the majority agrees that the threshold requirements of the doctrine may not be met in this case. (Maj. opn., ante, at pp. 1089-1091.) Unless and until it is determined that defendant has established the threshold requirements, it is unnecessary to discuss whether the public policy exception to the collateral estoppel doctrine applies on the facts of this case. The majority improperly inverts the analysis, by first discussing whether the public policy exception applies, and then, as if by afterthought, discussing whether the threshold requirements have even been established. This analytical inversion cannot hide the fact that the majority‘s conclusion regarding the threshold question — that defendant may have failed to establish the prerequisites of her collateral estoppel claim — and its reversal of the Court of Appeal‘s judgment on this basis make it unnecessary to address the applicability of the public policy exception. Thus, the majority‘s discussion is dictum.2 (See People v. Pearson (1986) 42 Cal.3d 351, 358 [228 Cal.Rptr. 509, 721 P.2d 595] [discussion of issue that might arise on remand “was essentially dictum” where court “determined that the judgment would be reversed on other grounds“]; People v. Mendoza (2000) 23 Cal.4th 896, 914 [98 Cal.Rptr.2d 431, 4 P.3d 265] [where conviction was reversed because of erroneous exclusion of evidence, discussion of other issues that might arise on retrial “was not necessary to . . . case‘s resolution“]; Stockton Theatres, Inc. v. Palermo (1956) 47 Cal.2d 469, 474 [304 P.2d 7] [“discussion or determination of a point not necessary to the disposition of a question that is decisive of the appeal is generally regarded as obiter dictum“].)
More fundamentally, I disagree with the majority‘s analysis of the issue. At the outset, it is important to note that the majority does not make an independent analysis of whether the relevant public policy considerations support application of collateral estoppel on the facts of this case. Nor does
the majority decide whether Sims was correctly decided. Instead, purporting to apply “[p]rinciples of stare decisis” (maj. opn., ante, at p. 1080), the majority simply considers whether “statutory and other changes” since Sims “warrant reconsideration of” that decision. (Id. at p. 1074.) Rather than focus almost exclusively on Sims, as does the majority, I also look to our subsequent decisions in Lucido and Vandenberg. Viewing those decisions in light of relevant statutory changes, I conclude that public policy considerations do not support application of collateral estoppel on the facts of this case.
Like the majority, I begin with Sims. There, we held that “collateral estoppel bar[red] the state from [criminally] prosecuting” a welfare recipient “for welfare fraud since she was exonerated in [an administrative fair] hearing of that charge.” (Sims, supra, 32 Cal.3d at p. 489.) In analyzing that question, we first considered whether “the technical prerequisites for applying collateral estoppel . . . were satisfied.” (Id. at p. 488.) After concluding that they were, we then considered whether “public policy considerations” supported the doctrine‘s application (id. at p. 489) on “the facts of [that] case.” (Id. at p. 477.) We stated that applying the doctrine “would promote judicial economy by minimizing repetitive litigation” and would prevent “the possibility of inconsistent judgments which may undermine the integrity of the judicial system” and of “the [administrative] fair hearing process.” (Id. at p. 488.) We next explained that not applying the doctrine would work “a hardship” on a welfare recipient “who presents a successful case at the fair hearing,” by requiring the recipient, “[i]n planning a budget for limited resources, . . . to take into consideration that he or she may still be required to return the benefits” that were “found” in the administrative hearing to have been “legally obtained.” (Id. at pp. 488-489.) Next, we stated that applying the doctrine “would protect [the defendant] from being harassed by repeated litigation.” (Id. at p. 489.) It ”
Eight years later, in Lucido, we again considered whether “collateral estoppel principles” may be invoked “to preclude criminal trials. [Citation.]” (Lucido, supra, 51 Cal.3d at p. 349.) There, based on a judicial finding in a probation revocation hearing that the state failed to prove an alleged criminal offense, the defendant argued that the state was collaterally estopped from criminally prosecuting him for that offense. (Id. at pp. 340-341.) After explaining that the defendant “arguably ha[d] fulfilled the threshold requirements” of collateral estoppel (id. at p. 341), we considered whether “the public policies underlying [the doctrine] — preservation of the integrity of the judicial system, promotion of judicial economy, and protection of litigants from harassment by vexatious litigation” — warranted its application. (Id. at p. 343.) Regarding the first, we acknowledged that “[p]ublic confidence in the integrity of the judicial system is threatened whenever two tribunals render inconsistent verdicts. [Citation.]” (Id. at p. 347.) However, we then explained that “[c]onsistency . . . is not the sole measure of the integrity of judicial decisions” (ibid.), and that in this context, preserving the integrity of the judicial system requires “preserving the criminal trial process as the proper forum for determinations of criminal guilt or innocence.” (Id. at p. 350, fn. 11.) In light of this concern, we explained, we have applied collateral estoppel principles to preclude criminal trials “only when compelling public policy considerations outweighed the need for determinations of guilt and innocence to be made in the usual criminal trial setting.” (Id. at p. 349.) Regarding the second policy consideration — judicial economy — we stated that “the efficiencies of applying collateral estoppel . . . pale before the importance of preserving the criminal trial process as the exclusive forum for determining guilt or innocence as to new crimes.” (Id. at p. 351.) Regarding the third policy consideration — vexatious litigation — after noting that “[t]he essence of vexatiousness . . . is harassment through baseless or unjustified litigation,” “not mere repetition,” we stated: “[The defendant] does
As the majority notes (maj. opn., ante, at p. 1084), in Lucido, we expressly explained why Sims did not require a different result. We cited Sims as a case in which “compelling public policy considerations outweighed the need for determinations of guilt and innocence to be made in the usual criminal trial setting.” (Lucido, supra, 51 Cal.3d at p. 349.) The determinative policy consideration we identified was “the ‘unique statutory scheme’ at issue” in Sims, which expressed — through the restitution-first requirement — a “legislative determination” to “deemphasize[] the role of criminal trials in the overall scheme for resolution of welfare fraud cases.” (Lucido, supra, 51 Cal.3d at pp. 349-350.) We then explained: “[B]ecause [of this] legislative determination,” the “concern . . . about the overall integrity of the criminal trial process as the intended forum for determinations of guilt and innocence was less at issue in Sims . . . . In the present case, by contrast, the Legislature has not indicated a preference that questions of guilt or innocence on criminal charges be litigated in revocation hearings rather than at trial. For this reason, we decline in this context to follow Sims‘s conclusion that preservation of the integrity of either the judicial system as a whole or the hearing process itself warrants application of collateral estoppel. Similarly, we decline to attribute as much weight in this case as we did in Sims to a need to prevent inconsistent judicial determinations.” (Ibid., fn. omitted.)
In Vandenberg, this court held that a private arbitration award, even when judicially confirmed, “may not have nonmutual collateral estoppel effect under California law unless there was an agreement to that effect in the particular case.” (Vandenberg, supra, 21 Cal.4th at p. 824, fn. omitted.) Regarding the relevant public policy considerations, the court reasoned that applying collateral estoppel in this context was not necessary either to preserve the integrity of the judicial system or to promote judicial economy. (Id. at p. 833.) As to the former, the court explained that “because a private arbitrator‘s award is outside the judicial system, denying the award collateral estoppel effect has no adverse impact on judicial integrity.” (Ibid.) As to the latter, the court reasoned that “because private arbitration does not involve the use of a judge and a courtroom, later relitigation does not undermine judicial economy by requiring duplication of judicial resources to decide the same issue.” (Ibid.)
Applying Sims, Lucido, and Vandenberg in light of the current statutory and administrative scheme, I conclude that public policy considerations do not support applying collateral estoppel on the facts of this case. Under Vandenberg, “because [an ALJ‘s decision at a fair hearing] is outside the judicial system, denying the award collateral
Indeed, the statutory and administrative scheme that now governs indicates a preference for resolution of welfare fraud cases through the criminal trial process. The
determine whether the recipient engaged in such conduct. (Id., §§ 20-300.24, 20-352.3.) Thus, whereas Sims found that application of collateral estoppel was “warranted . . . due to the unique statutory scheme which established a [legislative] preference for the noncriminal resolution of cases involving an accusation of welfare fraud” (Sims, supra, 32 Cal.3d at p. 490), the statutory and administrative scheme now in place indicates a preference for criminal resolution of such cases. For this reason, Sims does not govern here; instead, we should follow Lucido and hold that collateral estoppel does not apply in light of the public‘s paramount interest in “preserving the criminal trial process as the proper forum for determinations of criminal guilt or innocence.” (Lucido, supra, 51 Cal.3d at p. 350, fn. 11.)
The majority makes several errors in concluding that there is no existing “preference for criminal resolutions” of welfare fraud cases. (Maj. opn., ante, at p. 1083.) Initially, the majority fails to consider the language of
Even were the statutes and regulations silent on the point, as explained above, Lucido is not. In this regard, although
The majority incorrectly disregards Lucido in another important respect. According to the majority, the People may avoid the collateral estoppel problem that exists under the majority‘s conclusion simply by pursuing a criminal case “as speedily as the County pursues the matter administratively.” (Maj. opn., ante, at p. 1089.) In Lucido, we expressly rejected a similar analysis. There, after noting that “the People could avoid being collaterally estopped” by the decision in a probation revocation hearing “by prosecuting first” and “seeking revocation afterward,” we stated: “As in our previous cases, . . . we refuse to mandate such a chronology. [Citation.]” (Lucido, supra, 51 Cal.3d at p. 348, fn. 10.) Thus, in essentially mandating that a criminal prosecution be finished before completion of an administrative fair hearing, the majority again disregards Lucido.
In any event, the majority‘s discussion of this consideration rests on a false premise: that a county is in control of the speed with which administrative proceedings progress. It is the welfare recipient, not the county, who initiates the fair hearing process by filing a request. (
The majority disregards Lucido in at least one other important respect. The majority asserts that Sims merely made
The majority‘s attempts to distinguish Lucido are unsuccessful. According to the majority, the facts in Lucido “did not raise the concern expressed in Sims” that allowing criminal proceedings after an ALJ‘s findings of no fraud and no overpayment would “leave” welfare recipients “exposed to being ‘harassed by repeated litigation.’ [Citation.]” (Maj. opn., ante, at p. 1086.) However, although Lucido did not involve a welfare recipient, we did consider in that case the fact that applying collateral estoppel to a decision in a probation revocation hearing “would eliminate repetitive litigation” and “prevent [the defendant] from being subjected to consecutive proceedings raising the same factual allegations.” (Lucido, supra, 51 Cal.3d at p. 351.) As noted above, regarding this issue, we stated: “The essence of vexatiousness . . . is not mere repetition. Rather, it is harassment through baseless or unjustified litigation. [Citation.]” (Ibid.) Thus, whereas Sims found that it would have been “manifestly unfair” to permit the defendant‘s criminal prosecution after she “successfully demonstrated her innocence” at a “fair hearing” in which the government “had an adequate opportunity . . . to prove” its case (Sims, supra, 32 Cal.3d at p. 489), we held in Lucido that “mere repetition” is not enough to implicate the public policy concern about vexatious litigation. (Lucido, supra, at p. 351.) Given that Sims apparently equated repetition with harassment, and did not, in considering the integrity of the judicial system and judicial economy, even mention the importance of preserving the criminal trial process as the proper forum for determining criminal guilt or innocence,
Also unpersuasive is the majority‘s view that the facts in Lucido “did not raise the concern expressed in Sims” that allowing criminal proceedings after an ALJ‘s findings of no fraud and no overpayment would “impose a hardship on” welfare recipients. (Maj. opn., ante, at pp. 1085-1086.) As noted above, the “hardship” we identified in Sims was that involved in requiring a welfare recipient, after establishing at a fair hearing that benefits were “legally obtained,” to “plan[] a budget for limited resources” based on the possibility “he or she may still be required to return the benefits . . . .” (Sims, supra, 32 Cal.3d at pp. 488-489.) In my view, forcing convicted criminals who have successfully avoided probation revocation by establishing that they did not commit a new offense to plan their lives based on the possibility they might still be convicted of and incarcerated for that offense presents an equal or greater hardship; nonetheless, that is what Lucido requires.
In any event, the facts of this case do not present the hardship at issue in Sims. Whereas the hearing officer in Sims found that the defendant had not received overpayments and was entitled to keep the money in question (Sims, supra, 32 Cal.3d at p. 474), the ALJ here ruled that defendant did receive overpayments and had to return the extra money. Thus, in declining to apply
collateral estoppel and permitting defendant‘s prosecution to go forward, the trial court did not threaten defendant with having to return money the ALJ ruled she could keep. As noted above, in Sims, we identified the relevant inquiry as whether “policy” considerations supported collateral estoppel‘s application on “the facts of [that] case” (id. at p. 477), and we carefully limited our holding to “the particular and special circumstances of [that] case.” (Id. at p. 489.) Given these statements and the factual differences between Sims and the case now before us, the majority errs in concluding that “[p]rinciples of stare decisis” prevent us from reaching a different conclusion here. (Maj. opn., ante, at p. 1080.)
The majority also errs in asserting that this case “differs from Lucido” in that ” ’ [p]robation revocation hearings and criminal trials serve different public interests’ ” whereas “the purposes” of administrative fair hearings and welfare fraud prosecutions “do not differ greatly.” (Maj. opn., ante, at p. 1087.) The majority incorrectly indicates that the purpose of the administrative fair hearing here was ” ‘to prove that [defendant] had fraudulently obtained welfare benefits.’ ” (Ibid., italics added.) As the majority elsewhere explains, the issue at the fair hearing here was not whether defendant obtained the overpayments fraudulently, but whether they ” ‘were the
Indeed, under DSS regulations, the ALJ apparently lacked jurisdiction to determine whether defendant acted with fraudulent intent. The regulations provide that “intentionally” making “a false or misleading statement, or misrepresent[ing], conceal[ing], or withh[o]ld[ing] facts” constitutes an “Intentional Program Violation[]” (IPV). (MPP, §§ 20-300.1.11, 20-351i(1)(a).) IPV‘s may be dealt with administratively only at an “administrative disqualification hearing” (id., §§ 63-801.1.11, 63-801.231), which may be initiated only by the DSS or a county through service of notice on the welfare recipient. (Id., §§ 22-201.412, 22-202.51, 22-315.5.) The fair hearing at issue here, which was initiated by defendant‘s request in response to the notices of action (maj. opn., ante, at p. 1075), was not an administrative disqualification hearing. (See MPP, §§ 22-200.2 [“Administrative disqualification hearings are distinct from” fair hearings], 22-301.2 [same].) Indeed, because a criminal action was filed in this case, an administrative disqualification hearing to determine whether defendant committed an IPV could not have been held. (Id., §§ 20-300.24, 20-352.3.) And, because an IPV had not been established at an administrative disqualification hearing (or by a court), to the extent DSS claimed that defendant was at fault, the regulations required the claim to be “established and handled as an inadvertent household error claim.” (Id., § 63-801.23.231.) Thus, it was not within the ALJ‘s authority here to determine at defendant‘s fair hearing whether she acted with fraudulent intent.
In this regard, this case materially differs from Sims. There, the DSS alleged that the defendant had “fraudulently obtained” benefits by failing to report material information. (Sims, supra, 32 Cal.3d at p. 473.) Under the statutory scheme that governed the defendant‘s fair hearing in Sims, whether the overpayments resulted from a “willful failure to report facts” or “any willfully fraudulent device,” and whether the defendant had “willfully withheld information” were expressly relevant to the DSS‘s ability to recoup overpayments. (Former
In other respects, administrative fair hearings and criminal welfare fraud prosecutions “serve different public interests” in the same sense that, as we found in Lucido, “[p]robation revocation hearings and criminal trials serve different public interests . . . .” (Lucido, supra, 51 Cal.3d at p. 347.) A criminal prosecution is initiated by the People to vindicate the public‘s “vital interest in enforcement of [its] criminal laws.” (United States v. Jorn (1971) 400 U.S. 470, 479 [27 L.Ed.2d 543, 91 S.Ct. 547].) That interest includes “deter[ring] the individual from committing acts that injure society” and “express[ing] society‘s condemnation of such acts by punishing them.” (People v. Roberts (1992) 2 Cal.4th 271, 316 [6 Cal.Rptr.2d 276, 826 P.2d 274], italics added; see also Best v. State Bar (1962) 57 Cal.2d 633, 637 [21 Cal.Rptr. 589, 371 P.2d 325] [“purpose” of a “criminal proceeding” is “punishment” if “accused . . . is found guilty“].) As previously noted, an administrative fair hearing is initiated by a welfare recipient to vindicate the recipient‘s own private interest in challenging an “action of the county [welfare] department relating to his or her application for or receipt of public social services . . . .” (
The majority also errs in asserting that Lucido can meaningfully be distinguished by the absence in this case of “evidentiary rules [that] prohibit a welfare recipient‘s testimony at an administrative hearing from being introduced at a later criminal trial for welfare fraud.” (Maj. opn., ante, at p. 1086.) In Lucido, we explained that such rules “guarantee[] the probationer the ability to present a full case at the [revocation] hearing without running the risk of prejudicing his defense at a subsequent [criminal] trial.” (Lucido, supra, 51 Cal.3d at p. 351.) In the context of administrative welfare fraud hearings, such evidentiary rules are not critical to a welfare recipient‘s ability fully to present his or her case. By statute, administrative fair hearings are “informal,” must be conducted “in order to encourage free and open discussion by the participants,” and are not constrained by the “rules of procedure or evidence applicable in judicial proceedings.” (
Indeed, contrary to the majority‘s analysis, under Vandenberg, the most meaningful distinction between this case and Lucido establishes that it would be even more appropriate not less to apply collateral estoppel‘s public policy exception in this case than it was in Lucido. The probation revocation hearing in Lucido was a judicial proceeding decided by a judge of a “justice court.” (Lucido, supra, 51 Cal.3d at p. 339.) The fair hearing in this case was an administrative proceeding decided by a nonjudicial officer. As previously explained, under Vandenberg, that administrative fair hearings are “outside the judicial system” and do “not involve the use of a judge and a courtroom” supports the conclusion that, as a matter of public policy, we should not apply collateral estoppel in this case. (Vandenberg, supra, 21 Cal.4th at p. 833.)
The majority‘s stated reason for disregarding Vandenberg is inadequate. According to the majority, Vandenberg involved “a private arbitration” that “effectively ‘bypass[ed] the judicial system,’ ” whereas this case involves “a matter of public concern” dealt with in ” ‘a judicial-like adversary proceeding’ [citation] that [was] conducted by a state entity, the DSS, whose administrative law judges must follow California law and render decisions subject to judicial review. [Citation.]” (Maj. opn., ante, at p. 1086, fn. 6.) In making this assertion, the majority once again ignores prior precedent of this court, which characterizes “private arbitration proceedings” as ” ‘quasi-judicial’ proceedings . . . that are functionally equivalent to court proceedings. [Citation.]” (Moore v. Conliffe (1994) 7 Cal.4th 634, 645 [29 Cal.Rptr.2d 152, 871 P.2d 204].) The majority also ignores the fact that in Vandenberg, the arbitration “took place before a retired federal judge,” the parties conducted “[f]ormal discovery,” “the transcribed proceedings included representation by counsel, and extensive evidence, briefing, and argument,” the arbitrator issued “a lengthy and detailed decision,” and the arbitration award was judicially “confirmed by a superior court judgment” (Vandenberg, supra, 21 Cal.4th at p. 826), which gave it “the
Finally, for several reasons, the majority‘s assertion that the Legislature, in amending the welfare fraud statutes in 1984, “did not contemplate abrogating Sims” (maj. opn., ante, at p. 1087) is unpersuasive. First, it is largely beside the point. As we have explained, the result in Sims was a judicial policy decision that was “informed by the ‘unique statutory scheme’ at issue there. [Citations.]” (Gikas v. Zolin (1993) 6 Cal.4th 841, 851 [25 Cal.Rptr.2d 500, 863 P.2d 745].) Thus, the primary question here is not whether the Legislature intended to abrogate Sims, but whether we should make a different policy decision in this case because, among other things, the ” ‘unique statutory scheme’ ” that “informed” our policy decision in Sims (ibid.) has been materially changed.
Second, the majority‘s analysis is inconsistent with our prior decisions. The majority asserts that we must presume the Legislature was aware of Sims and would have specified that administrative decisions do not preclude criminal prosecutions for welfare fraud had it wanted to invalidate Sims. (Maj. opn., ante, at p. 1088.) We rejected a very similar argument in Estate of Kachigian (1942) 20 Cal.2d 787 [128 P.2d 865]. At issue there was our construction of the probate homestead statutes, which we had based on the homestead statutes that apply before death. (Id. at pp. 788-790.) The question we faced was whether a legislative amendment to the latter affected the former. (Ibid.) Offering an analysis very similar to the majority‘s, the respondent in Kachigian, who contended that the amendment did not effect a change, argued: ” ‘[I]t must be presumed that the Legislature was familiar with the former decisions and that in failing to change the probate statutes it must have intended to leave the probate law unchanged.’ ” (Id. at p. 790.) We rejected the argument, stating: “[I]f we presume that the Legislature was familiar with the former decisions, it would seem improper for us to presume that it was unaware of their basic reasoning and hold that it did not realize the probate rule must change if the basis therefor were changed.” (Ibid.) Similarly, here, “if we presume that the Legislature was familiar with [Sims], it would seem improper for us to presume that [the Legislature] was unaware of [Sims‘s] basic reasoning and hold that [the Legislature] did not realize the [Sims] rule must change if [a] basis therefor were changed.” (Ibid.) Thus, I disagree with the majority‘s
As the preceding analysis demonstrates, ultimately, in concluding that Sims does not “warrant reconsideration” (maj. opn., ante, at p. 1074), the majority is focusing on the wrong question. As noted above, in Sims, we considered whether “policy” considerations supported collateral estoppel‘s application on “the facts of [that] case” (Sims, supra, 32 Cal.3d at p. 477), and we expressly limited our holding to “the particular and special circumstances of [that] case.” (Id. at p. 489.) As also explained above, the facts and circumstances of the case now before us are different: the restitution-first requirement that was a “basis for our decision in Sims” (maj. opn., ante, at p. 1083) no longer exists, the ALJ ruled that defendant must repay the overpayments she received, and the question of whether defendant intentionally made misrepresentations or omissions was not at issue in the administrative proceeding. Thus, the question we must answer here is not, as the majority posits, whether to reconsider Sims, but is whether to extend that decision to the
different facts and circumstances of this case. More precisely, under Lucido, a precedent of this court that the majority simply ignores in relevant part, the question we must answer is whether “compelling public policy considerations outweigh[] the need for determinations of guilt and innocence to be made in the usual criminal trial setting.” (Lucido, supra, 51 Cal.3d at p. 349Lucido and concluding that although collateral estoppel does not apply after probation revocation hearings, it may apply after administrative fair hearings, were it necessary to decide the question here, I would hold that public policy considerations do not support applying collateral estoppel in “the particular and special circumstances of this case.” (Sims, supra, 32 Cal.3d at p. 489.)
Corrigan, J., concurred.
Notes
Among other things, Vandenberg involved an insurance coverage dispute between two insurance companies that was presided over by a private arbitrator who was “not strictly bound by evidence, law, or judicial oversight.” (Vandenberg v. Superior Court, supra, 21 Cal.4th at p. 833.) Unlike a private arbitration, in which parties effectively “bypass the judicial system” in favor of private dispute resolution (Moncharsh v. Heily & Blase (1992) 3 Cal.4th 1, 10 [10 Cal.Rptr.2d 183, 832 P.2d 899]), the public administrative hearing at issue here and in Sims is “a judicial-like adversary proceeding” (Sims, supra, 32 Cal.3d at pp. 479-480) that is conducted by a state entity, the DSS, whose administrative law judges must follow California law and render decisions subject to judicial review. (See
This provision of Senate Bill No. 962 was intended to “repeal the Sims decision by providing that no administrative decision would prevent the prosecution of an applicant or recipient for criminal violation of the welfare fraud provision.” (Sen. Com. on Judiciary, Analysis of Sen. Bill No. 962 (1983-1984 Reg. Sess.) as amended Apr. 21, 1984, p. 12.) The Legislature, however, did not enact Senate Bill No. 962. Rather, the Legislature modified the welfare fraud statutes by enacting into law Senate Bill No. 2171, which did not contain a provision preventing the application of collateral estoppel principles to an administrative decision. However, as this court has previously noted, unpassed bills “have little value” in ascertaining legislative intent. (People v. Mendoza (2000) 23 Cal.4th 896, 921 [98 Cal.Rptr.2d 431, 4 P.3d 265].)
Of course, the analysis might be different had defendant petitioned under