CITY OF SANTA MONICA v. COUNTY OF LOS ANGELES

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Court of Appeal, Second District, Division 4, California.

CITY OF SANTA MONICA, Plaintiff and Appellant, v. COUNTY OF LOS ANGELES, et al., Defendants and Appellants.

No. B050105.

Decided: March 23, 1992

Robert M. Myers, City Atty., Mary H. Strobel, Barry A. Rosenbaum, and Adam Radinsky, Deputy City Attys., for plaintiff and appellant. De Witt W. Clinton, County Counsel, Roberta M. Fesler, Asst. County Counsel, Patrick A. Wu, Principal Deputy County Counsel, and Catherine M. Dziuba, Sr. Deputy County Counsel, for defendants and appellants.

The City of Santa Monica (the City) filed a “taxpayer” suit (Code Civ.Proc., § 526a) against the County of Los Angeles (the County) seeking declaratory and injunctive relief and a writ of mandate.   The gravamen of the City's complaint was that the County was breaching its statutorily imposed duty to provide mental health services to the indigent mentally ill brought for treatment by the City's police officers.

After the County's demurrer was overruled, it moved for summary judgment and, alternatively, for summary adjudication of issues.   After the court summarily adjudicated most of the issues in the County's favor, the parties stipulated to withdraw the remaining issues of fact and to entry of judgment.

The City appeals, challenging the court's determination that pertinent sections of the Welfare & Institutions Code do not impose the duty on the County asserted by the City.

The County appeals, arguing that the court erred when it overruled its earlier demurrer which had been based on the City's lack of standing to sue pursuant to Code of Civil Procedure section 526a.

For the reasons set forth below, we hold that Code of Civil Procedure section 526a does not confer standing on a municipal corporation to sue pursuant to its provisions.   Consequently, we need not and do not address the other issues raised by the City.

FACTUAL AND PROCEDURAL HISTORY

The City filed its initial complaint against the County on August 27, 1986, and its first amended complaint on January 19, 1988.   It alleged that it is a municipal corporation, existing under a freeholder's charter, and a taxpayer, which had paid taxes to the County within one year prior to commencement of its action;  pursuant to Welfare and Institutions Code sections 5150, 5152, and 5250,1 the County had a duty to conduct a 72–hour assessment of whether a mentally ill indigent brought to a County facility for treatment by a City police officer was a danger to others, a danger to himself or herself, or gravely disabled;  pursuant to statutory authority, City police officers have transported LPS (Lanterman–Petris–Short Act) eligible persons to County designated facilities for 72–hour evaluation;  when, in fact, such persons are presented to the County and no acute bed space for the 72-hour treatment and evaluation is available, the County has a policy and practice of “failing to exercise [its] discretion by refusing to assess” the person;  instead of providing the further evaluation required by section 5152, the persons admitted for 72–hour assessment are kept in overcrowded and dangerous conditions;  in contravention of the requirements of section 5152, the mentally ill indigent are released without the requisite approval of the attending psychiatrist;  County bases its decision to release these individuals not on section 5152 but on “pressure for new admissions and asserted overload of emergency units.”

The complaint also alleged that the County was breaching its duty to provide nonemergency mental health care to the indigent, citing sections 5602, 5325.1, 5151, 17000, 7360 and 7362;  as a result of the County's breach of its statutorily defined duties, the City has many chronically mentally ill indigents residing in its street, alleys, parks, and other public and private property in the City and has had to expend considerable City resources to address the various needs of these people.2

On February 17, 1988, the County demurred to the complaint, asserting, inter alia, that the City lacked standing as it was not a real party in interest, and did not have taxpayer standing.   The court (Judge Torres) overruled the demurrer.

On October 16, 1989, the County moved for summary judgment or, alternatively, for summary adjudication of the issues.   In sum, the County asserted that the cited statutes did not impose upon it a duty to perform the services described therein.

On November 9, 1989, the court (Judge Zebrowski) adjudicated most of the issues in favor of the County.

The parties agreed to entry of a stipulated judgment, agreeing that remaining issues would be withdrawn, that judgment on the entire action would be entered, and that the stipulation would not constitute a waiver of the City's right to appeal issues determined adversely to it in the order granting summary adjudication of the issues or the County's right to appeal any issues determined adversely to it prior to the order granting summary adjudication of the issues.   On March 6, 1990, the notice of entry of judgment was filed and served.   These timely appeals followed.

DISCUSSION

 Preliminarily, we note that ordinarily we would not entertain an appeal from a judgment entered upon consent of the parties;  however, as the parties agreed to the stipulated judgment in order to facilitate appeal following adverse determination of critical issues, they have not lost their right to be heard on appeal.  (Building Industry Assn. v. City of Camarillo (1986) 41 Cal.3d 810, 817, 226 Cal.Rptr. 81, 718 P.2d 68.)

 An additional question remains as to whether the County's appeal may proceed when the final judgment is in its favor, and it has not been aggrieved.  (See 9 Witkin, Cal.Procedure (3d ed. 1985) Appeal, § 142, p. 151.)   While “an order overruling a demurrer is not an appealable order [citation], [and] may be reviewed on an appeal from the judgment itself [citation]” (In re Troy D. (1989) 215 Cal.App.3d 889, 896–897, 263 Cal.Rptr. 869), the problem here is that the challenge to the overruling of the earlier demurrer is presented by an appellant in favor of whom judgment has been entered.   We conclude, however, that because the County presents important, determinative issues, which the parties have fully briefed, and the more appropriate action would have been to seek review by extraordinary writ (see State of California v. Superior Court (1984) 150 Cal.App.3d 848, 853, 197 Cal.Rptr. 914), we shall treat the County's appeal as a petition for writ of mandate and address the issues raised therein.  (See Schultz v. Regents of University of California (1984) 160 Cal.App.3d 768, 788, 206 Cal.Rptr. 910;  9 Witkin, Cal.Procedure, supra, Appeal, § 62, pp. 86–87.)

 The threshold issue is whether, pursuant to Code of Civil Procedure section 526a,3 the City has standing to file suit against the County.

Without comment, the court below held that the City had standing pursuant to this statute.   As statutory interpretation is a question of law, we are not bound in any way by the trial court's determination and, instead, exercise our independent judgment.  (Wallace Berrie & Co. v. State Bd. of Equalization (1985) 40 Cal.3d 60, 65, 219 Cal.Rptr. 142, 707 P.2d 204.)

“ ‘ “The fundamental rule of statutory construction is that the court should ascertain the intent of the Legislature so as to effectuate the purpose of the law.  [Citations.]  Moreover, every statute should be construed with reference to the whole system of law of which it is a part so that all may be harmonized and have effect.”  [Citation.]  If possible, significance should be given to every word, phrase, sentence and part of an act in pursuance of the legislative purpose.  [Citation.]  Such purpose will not be sacrificed to a literal construction of any part of the act.’  ․ [¶] For purposes of statutory construction, the various pertinent sections of all the codes must be read together and harmonized if possible.  [Citation.]  ․ [¶] Statutes must be given a reasonable construction which conforms to the legislative intent.   They should be interpreted to promote the objective intended and consistent with wise policy, and the statutory language read as a whole, as well as consequences that would flow from a particular result must be considered.   [Citation.]”  (Mendez v. Kurten (1985) 170 Cal.App.3d 481, 485–486, 215 Cal.Rptr. 924.)

In pertinent part, section 526a provides, “An action to obtain a judgment, restraining and preventing any illegal expenditure of, waste of, or injury to, the estate, funds, or other property of a county, town, city or city and county of the state, may be maintained against any officer thereof, or any agent, or other person, acting in its behalf, either by a citizen resident therein, or by a corporation, who is assessed for and is liable to pay, or, within one year before the commencement of the action, has paid, a tax therein.”

“The primary purpose of section 526a is to enable a large body of the citizenry to challenge governmental action which would otherwise go unchallenged in the courts because of the standing requirement.”  (White v. Davis (1975) 13 Cal.3d 757, 764–765, 120 Cal.Rptr. 94, 533 P.2d 222, internal quotation marks omitted.)   Suits brought pursuant to section 526a are commonly known as “taxpayer's suits.”  (See generally 4 Witkin, Cal.Procedure (3d ed. 1985) Pleading, §§ 134–142.)

By its clear terms, this statute does not confer standing upon the City.   It provides that the enumerated actions may be brought by an individual citizen-taxpayer or by a corporation-taxpayer.4

 The City argues, however, that this statute has been liberally construed and that since it is a municipal corporation, it should be granted standing as a “corporation.”   We reject this assertion because the terms “municipal corporation” and “corporation” each have a specific meaning and are not interchangeable.

 Section 162 of the Corporations Code states that “corporation” refers only to “a corporation organized under this division” or a corporation subject to this division under provisions not pertinent here.   A corporation is a legal person or entity, organized to effectuate the purposes set forth in its articles of incorporation, mainly for its benefit and that of its shareholders.  (See generally 9 Witkin, Summary of Cal.Law (9th ed. 1989) Corporations, § 1 et seq.)

 A municipal corporation, however, in its strict or proper sense, is an incorporated city or town (Division of Labor Law Enforcement v. El Camino Hosp. Dist. (1970) 8 Cal.App.3d Supp. 30, 35, 87 Cal.Rptr. 476) and, in its broader sense, is a public corporation, “exercising governmental functions, either general or special.”  (Turlock Irr. Dist. v. White (1921) 186 Cal. 183, 186, 198 P. 1060, quoting Merchants Bank v. Escondido Irr. Dist. (1904) 144 Cal. 329, 333, 77 P. 937, disapproved on other grounds in Metropolitan W. Dist. v. Co. of Riverside (1943) 21 Cal.2d 640, 644, 134 P.2d 249.)  “The distinguishing feature of a municipal corporation, or a quasi-municipal corporation, is that it is not only a body corporate but also a body politic, ․ endowed with the right to exercise ․ a portion of the political power of the state․”  (1 McQuillin, Municipal Corporations (3d ed. 1987) § 2.07a, p. 152.)   The primary purpose of a municipal corporation is “to regulate and administer the local and internal affairs of the particular community, mainly for the interest, advantage and convenience of the locality and its people.”  (Id., § 2.08, p. 159.)

Thus, we conclude that a municipal corporation and a private corporation are distinct and have different functions.

The Legislature is assumed to have understood the difference between a municipal corporation and a corporation.   When the Legislature enumerates those empowered by a particular statute, as it did here, we are not free to imply or presume an addition to the list.  (Wildlife Alive v. Chickering (1976) 18 Cal.3d 190, 195, 132 Cal.Rptr. 377, 553 P.2d 537.)   We hold, therefore, that the City has no standing to bring suit pursuant to section 526a, and that the court erred when it found to the contrary.

The City strenuously objects, citing the past liberal construction of this statute by our courts.   We agree that our courts have liberally construed this statute to allow a variety of challenges to governmental action.   None of these cases, however, have rewritten the statute to expand the list of those who have standing to sue without finding a constitutional infirmity.  (See Irwin v. City of Manhattan Beach, supra, 65 Cal.2d at 19, 51 Cal.Rptr. 881, 415 P.2d 769.)   Rather, they have expanded the notion of what constitutes waste of public funds and which public officials may be sued.  (See, e.g., Blair v. Pitchess (1971) 5 Cal.3d 258, 268, 96 Cal.Rptr. 42, 486 P.2d 1242.)

The City asserts that it has standing as a real party in interest and relates facts which it contends prove the point.   As these facts are subject to challenge, they are improperly presented.   According to the stipulation agreed upon by the parties, any factual dispute not resolved by the stipulation was withdrawn.   Consequently, we have no basis upon which to consider this contention.

DISPOSITION

Let the peremptory writ of mandate issue, ordering the superior court to vacate the judgment and to enter an order sustaining the demurrer of the County, without leave to amend, and thereafter to enter a judgment of dismissal.   Each party is to bear its costs on appeal.

FOOTNOTES

FOOTNOTE.  

1.   Subsequent statutory references are to the Welfare and Institutions Code unless otherwise indicated.

2.   The bulk of these statutes are part of the Lanterman–Petris–Short Act (LPS) and its companion funding statute, the Short–Doyle Act, both adopted in 1967.  (§ 5000 et seq. and § 5600 et seq.)   The LPS, in part, intended:  to end the inappropriate, indefinite, and involuntary commitment of mentally disordered persons and others;  to provide prompt evaluation and treatment of persons with serious mental disorders;  to guarantee and protect public safety;  and to safeguard individual rights through judicial review.  (§ 5001.)In pertinent part, section 5150 provides, “When any person, as a result of mental disorder, is a danger to others, or to himself or herself, or gravely disabled, a peace officer, ․ or other professional person designated by the county may, upon probable cause, take, or cause to be taken, the person into custody and place him or her in a facility designated by the county and approved by the State Department of Mental Health as a facility for 72–hour treatment and evaluation․”Section 5152 sets forth the method and type of treatment which shall be administered after a person is admitted to a facility for 72–hour assessment and provides that a person may be released after 72 hours only upon approval of the attending psychiatrist.In pertinent part, section 5250 provides, “If a person is detained for 72 hours ․ and has received an evaluation, he or she may be certified for not more than 14 days of intensive treatment related to the mental disorder ․ under the following conditions:  [¶] (a) The professional staff of the agency or facility providing evaluation services has analyzed the person's condition and has found the person is, as a result of mental disorder ․ a danger to others, or to himself or herself, or gravely disabled.  [¶] (b) The facility providing intensive treatment is designated by the county to provide intensive treatment, and agrees to admit the person․  [¶] (c) The person has been advised of the need for, but has not been willing or able to accept, treatment on a voluntary basis․”

3.   Subsequent statutory references are to the Code of Civil Procedure unless otherwise indicated.

4.   In Irwin v. City of Manhattan Beach (1966) 65 Cal.2d 13, 19, 51 Cal.Rptr. 881, 415 P.2d 769, our Supreme Court struck down that portion of this statute which required a citizen-taxpayer to be a resident when a corporation-taxpayer is not so required, finding it to be a violation of the equal protection clause.

STEPHENS, Associate Justice *. FN* Opinion on rehearing June 10, 1992, not designated for publication.

ARLEIGH M. WOODS, P.J., and EPSTEIN, J., concur.

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