COMMODORE HOME SYSTEMS INC v. BROWN

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Court of Appeal, Fourth District, Division 2, California.

COMMODORE HOME SYSTEMS, INC., Petitioner, v. The SUPERIOR COURT OF SAN BERNARDINO COUNTY, Respondent. Johnnie BROWN and Bennie Butler, Jr., Real Parties in Interest.

Civ. 25774.

Decided: October 19, 1981

Munger, Tolles & Rickershauser and Ralph F. Hirschmann, Los Angeles, for petitioner. No appearance for respondent. Hanson & Adams and Michael D. Hanson, San Bernardino, for realparties in interest.

OPINION

In these original proceedings we are called upon to interpret section 12970 of the Government Code,1 which is part of the California Fair Employment and Housing Act (FEHA), being sections 12900-12996 of the Government Code. More particularly, we must decide whether section 12970 has clothed the Fair Employment and Housing Commission with power to adopt, among its regulations, defining the remedies available under the act, one which includes exemplary damages. Subdivision (c) of section 7286.9, Title 2 of the California Administrative Code provides: “While normal monetary relief shall include relief in the nature of back pay, reasonable exemplary or compensatory damages may be awarded in situations involving violations which are particularly deliberate, egregious or inexcusable.”

In our view, a portion of this section of the regulations promulgated under FEHA is void, insofar as it authorizes the award of exemplary damages, because, in so doing, it exceeds the authority available to the commission in adopting regulations which undertake to carry out the purposes of section 12970. Our decision proceeds under section 11342.2 of the Government Code which states: “Whenever by the express or implied terms of any statute a state agency has authority to adopt regulations to implement, interpret, make specific or otherwise carry out the provisions of the statute, no regulation adopted is valid or effective unless consistent and not in conflict with the statute and reasonably necessary to effectuate the purpose of the statute.”

The need to interpret section 12970 and the validity of the regulation noted arises in the context of the trial court's refusal to grant the petitioner's motion to strike from real parties' complaint certain allegations which had been included with the hope that they could provide the basis for an award of exemplary damages in an action brought for employment discrimination on the basis of race. Because that portion of the regulation authorizing exemplary damages is void,2 as noted, the trial court should have granted the motion. Accordingly, we shall grant the petition.

PROCEDURAL POSTURE OF THE CASE

Real parties Johnnie Brown and Bennie Butler, Jr., (plaintiffs) together filed a complaint against petitioner Commodore Home Systems, Inc., (defendant) to recover damages, including exemplary damages, arising from alleged employment discrimination on the basis of race. As germane to these proceedings, the first amended complaint alleged that plaintiff Brown was employed by defendant as a quality assurance manager and that plaintiff Butler was hired by defendant as a quality control inspector. Both thereafter undertook to perform the duties of those positions.

According to the complaint, Butler was terminated about ten months after having been employed. As alleged, Butler says he was told that the reason for his termination was because Commodore was reducing its work force. The defendant Butler went on to allege on information and belief that “defendant Commodore has had and is maintaining a policy of not allowing otherwise well qualified blacks to act in management and supervisorial positions, and plaintiff is further informed and believes and thereon allege(s) that Commodore has no black management employees at this time and has terminated all other blacks which were in or could have been promoted to management or supervisorial positions.”

Butler then alleged that he had filed a complaint with the Department of Fair Employment Practice and Housing under section 1422.2 of the Labor Code.3 According to the complaint, the department chose not to issue a complaint against Commodore, a decision which left defendant with his option to file in superior court. This action resulted, and Butler alleged in connection therewith that defendant had “committed unlawful employment practices” in that he had been terminated “solely because (he) was a member of the negro race ”

Of direct significance to these proceedings, the complaint also included a paragraph which alleged that “defendants acted with total disregard of plaintiff's rights and feelings as a person, and his employment rights, and their conduct demonstrated an explicit intent to violate the rights of plaintiff Bennie Butler, and defendants therefore acted in an oppressive and malicious manner toward plaintiff Bennie Butler, such that plaintiff Bennie Butler is entitled to exemplary and punitive damages in the sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000.00).”

Similar allegations were included in the second count as to the defendant Brown who was first terminated at the same time as was Butler. However, he was rehired about four months later, but again was terminated after only four months of further employment. Brown also filed a complaint with the Department of Fair Employment Practice and Housing; however, just as in the case of Butler, the department opted not to proceed against Commodore. Likewise included in the second count on behalf of Brown was a paragraph providing the predicate for recovery of exemplary damages for the reason that defendants had acted in “an oppressive and malicious manner toward plaintiff Johnnie Lee Brown ”

After jurisdiction was gained over defendant in the superior court action, defendant moved to strike the two identical paragraphs appearing in each of the two counts which the plaintiffs had included for purposes of providing the basis for an award of exemplary damages.4 The trial court denied the motion to strike. To obtain a review of the propriety of such denial, the defendant petitioned for a writ of mandate. We issued the alternative writ, and the matter is now before us for disposition.

DISCUSSION

In terms of the motion to strike and the denial thereof, the issue here is whether exemplary damages, in addition to back pay, may be awarded in actions brought under FEHA. No decided case has yet ruled on the issue, and we are satisfied to hold that no such damages are recoverable.

As background against which to pursue the exercise of interpreting section 12970, we shall comment briefly on the administrative process contemplated by FEHA. An aggrieved employee, believing himself to be the victim of an unlawful employment practice, may file a verified complaint with the department. A departmental investigation then follows, and, if the department concludes that the facts warrant it, an accusation is issued by the department against the allegedly offending employer as respondent.

Based upon the issues thus joined, the accusation is tried before the commission, and, if it finds that the respondent has engaged in any unlawful employment practice, the commission may issue a determination and order relief. As already indicated in footnote 1, such relief can take the form of an order requiring an employer “to take such action including but not limited to (its) hiring, reinstatement or upgrading of employees, with or without back pay ” (Gov.Code, s 12970.)

If the department decides (as here) that the facts do not justify the issuance of an accusation against the employer, the aggrieved employee may nevertheless file his own plenary action in the superior court. (Gov.Code, s 12965, subd. (b).)

Returning then to the task of interpretation, we note that the parties have represented to us that they are in agreement that the remedies available to an aggrieved employee as a result of a successful action in the superior court cannot exceed those otherwise available in an administrative proceeding prosecuted by the department.

Conceding this, the plaintiffs yet point to a regulation promulgated by the commission in 1980 which by its terms defines remedies available to the commission to impose under FEHA to include exemplary or compensatory damages. To recite it again, “(w)hile normal monetary relief shall include relief in the nature of back pay, reasonable exemplary or compensatory damages may be awarded in situations involving violations which are particularly deliberate, egregious or inexcusable.” (Calif.Admin.Code, Title 2, s 7286.9, subd. (c).) Thus, the particular question to be resolved, as presented by the procedural posture of this case, is whether the language of section 12970 contemplates the possible award of exemplary damages in addition to “back pay.” If not, that portion of the regulation so providing is void.

Petitioner, in aid of the stated task of interpretation has advanced four reasons in support of its contention that administrative remedies available to employees under FEHA do not include any monetary awards other than back pay. Stated in general terms, they are: (1) the language of FEHA itself bars such remedies; (2) contrasting language in other California discrimination laws demonstrates that the Legislature has expressly authorized broader damage remedies when that has been its intention and has not done so here; (3) the National Labor Relations Act, upon which FEHA was modeled and which contains remedial provisions similar to those in FEHA, has been interpreted, before the adoption of FEHA, to bar these broader remedies; (4) Title VII of the federal Civil Rights Act of 1964, which also contains remedy provisions for employment discrimination similar to those found in FEHA, has been interpreted to bar exemplary damages for reasons directly applicable to an interpretation of FEHA.

I

Section 12970 is explicit in stating what relief the commission may grant. To repeat, in its order it may require a respondent “to take such action, including, but not limited to, hiring, reinstatement or upgrading of employees, with or without back pay ” Thus it appears by its express terms that no monetary recovery is provided for except back pay, and even that award is discretionary.

In section 12970, following the recitation of the various remedies available for imposition by the commission on a respondent, further language characterizes such remedies as being those which “will effectuate the purposes of this part.” Even so, as observed by the petitioning defendant, “It would violate the spirit of Section 12970 to expand the scope of damages when back pay, the only damage remedy expressly mentioned, is itself so cautiously authorized. The express provision (in) Section 12970 for back pay would be purposeless if it could be swallowed up in a sea of damage remedies inferred under the concluding general phrase in Section 12970.”

This observation suggests application of the maxim ejusdem generis. It is a principle applied in the construction of statutes or contracts, where general words follow an enumeration of words with a more specific meaning. In such instances, the general words will be construed no wider than the specific. As stated in Pasadena University v. Los Angeles County, 190 Cal. 786, 214 P. 868, “It is the rule of construction that where general words follow the enumeration of particular classes of persons or things, the general words will be construed as applicable only to persons or things of the same general nature or class as those enumerated. (Citations.)” (Id. at p. 790, 214 P. 868.) As further observed in Scally v. Pacific Gas & Electric Co., 23 Cal.App.3d 806, 100 Cal.Rptr. 501, “The rule is based on the obvious reason that if the Legislature had intended the general words to be used in their unrestricted sense, it would not have mentioned the particular things or classes of things which would in that event become mere surplusage.” (Id. at p. 819, 100 Cal.Rptr. 501.)

The wisdom of the foregoing maxim is aptly demonstrated in its application to the interpretation of section 12970. The subsequent phrase “action as will effectuate the purposes of this part” cannot be plausibly interpreted except by relying upon the enumeration of specific remedies which precedes it. This is especially true here where there are no records of legislators' comments or committee reports to shed light on the matter. FEHA's general declaration of policy is found in section 12920 of the Government Code5 which is wholly general and affords no specific guidance on the damages remedies.

Thus, applying well-established principles of statutory construction to the language of section 12970, it can be readily concluded that the Legislature never intended to clothe the commission with power to exact exemplary damages from a respondent. That portion of the regulation so providing therefore exceeds the commission's authority to adopt it, and that portion is void.

II

The employment discrimination provisions contained in FEHA are only a part of the body of civil rights legislation now in force in California. In 1959, the year the provisions of law now under consideration were first passed, the Legislature also passed the Hawkins Act6 which barred discrimination in housing. In that same year it also passed the Unruh Civil Rights Act,7 which barred discrimination in certain kinds of business establishments catering to the public. In 1963, the Legislature passed the Rumford Fair Housing Act which supplanted the Hawkins Act. In each of these packages of legislation express provision has been made for exemplary damages. From this it can be concluded, had the Legislature intended that victimized employees could recover such damages under FEHA, it would have so provided.

Logic also supports such a conclusion. The exercise of racial discrimination can have varying shades of attitude, motive, and objective when practiced in the areas of housing and public accommodations. However, employment is another matter. To strike down a person's opportunity to earn a living solely on the basis of race can never be less than malicious and oppressive. Thus, for the regulation to attempt to differentiate and assume that such discrimination, in some cases, will be “deliberate, egregious, or inexcusable,” and in others not, is pure sophistry. In other words, any employment discrimination based on race is malicious, oppressive, egregious, and inexcusable. This being so, if the Legislature has nevertheless refrained from providing for exemplary damages in so obvious an instance of oppressive behavior, surely, for reasons sufficient to the Legislature, such damages were not intended to be available.

In so holding, we hasten to observe that the other remedies which have been made available are hardly negligible. To be reinstated with back pay represents a very substantial remedy.

III

We find it unnecessary to discuss at length the additional reasons in aid of interpreting section 12970 suggested by the petitioning defendant, the foregoing having demonstrated a sufficient basis for our holding. In sum however, defendant correctly elaborates in its petition that damages other than back pay are unavailable under the National Labor Relations Act. The NLRA was passed before FEHA and the latter was fashioned substantially in the same terms as the former.

As recently as only one year before FEHA was passed, the United States Supreme Court in UAW-CIO v. Russell, 356 U.S. 634, 78 S.Ct. 932, 2 L.Ed.2d 1030, ruled that damages other than back pay were barred under section 10(c) of the act. The court said, “The remedy of back pay, it must be remembered, is entrusted to the Board's discretion; it is not mechanically compelled by the Act. (Citations.) The power to order affirmative relief under s 10(c) is merely incidental to the primary purpose of Congress to stop and to prevent unfair labor practices. Congress did not establish a general scheme authorizing the Board to award full compensatory damages for injuries caused by wrongful conduct.” (Id. at pp. 642-643, 78 S.Ct. at p. 937.)

Otherwise, defendant correctly observes, “Five years after California enacted the employment discrimination provisions now embodied in FEHA, Congress passed its own employment discrimination legislation: Title VII of the Civil Rights Act of 1964 (‘Title VII’). 42 U.S.C. s 2000e-5. FEHA and Title VII contain virtually identical provisions with regard to the remedies for employment discrimination. Title VII has been interpreted repeatedly and almost without exception to bar damages other than back pay. Although Title VII was passed after FEHA, its interpretation is important because the reasons for the interpretation are directly applicable to FEHA.”

By “reasons for interpretation” the petitioner goes on in its petition to elaborate that the federal courts have in similar fashion relied on the maxim of ejusdem generis and on comparison with other civil rights statutes much as we have above in reaching the conclusion that in Title VII the Congress did not intend that exemplary damages in addition to back pay be available to employees who are found to be victims of employment discrimination.

One example will suffice. In Richerson v. Jones, 551 F.2d 918 (3d Cir.), the court said, “As the Supreme Court has observed, 42 U.S.C. s 2000e-5(g) was modeled closely on the provision of the National Labor Relations Act which empowers the (Board) to end unfair labor practices (Citation.) (Section 10(c)) authorized the (Board), inter alia, ‘to take such affirmative action including reinstatement of employees with or without back pay, as will effectuate the policies of this subchapter.’ 42 U.S.C. s 2000e-5(g) empowered the district court in Title VII cases to ‘order such affirmative action as may be appropriate, which may include reinstatement or hiring of employees, with or without back pay ’ Since punitive damages are clearly not available under the (NLRA), the close relationship between 42 U.S.C. s 2000e-5(g) and (Section 10(c)) provide additional evidence that Congress did not intend to authorize the award of punitive damages under Title VII. (Fns. omitted.)'' (Id. at p. 927.)

IV

Plaintiffs for their part argue that the maxim of ejusdem generis is not applicable. In particular, they point to the words in section 12970, “but not limited to,” directly preceding the enumeration of specific remedies as operating to open the door to the commission to add exemplary damages as an available remedy. We reject the argument for the reasons already recited. To hold otherwise would be to relegate the specific terms to “mere surplusage” as noted by Justice Kane in Scally.

Otherwise, plaintiffs point to the Federal Civil Rights Act, Title 42, United States Code section 1981 et seq., as providing an argument by analogy for the sanctioning of exemplary damages under FEHA. Section 1981 provides, “All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.”

Historically, the Federal Civil Rights Act was passed to implement the prohibitions imposed on the several states by the Fourteenth Amendment, and thus any discussion of remedies in this area imports the concept of state action. No such circumstance is here involved.

DISPOSITION

The petition is granted. Let a peremptory writ of mandate issue to the respondent superior court in No. 199285 directing it to vacate its order of August 3, 1981, and thereupon to enter a new and different order granting the defendant's motion to strike paragraph XV from the first count and paragraph XII from the second count of the First Amended Complaint. The alternative writ is discharged.

FOOTNOTES

1.  In pertinent part section 12970 reads: “(a) If the commission finds that a respondent has engaged in any unlawful practice under this part, it shall state its findings of fact and determination and shall issue and cause to be served on the parties an order requiring such respondent to cease and desist from such unlawful practice and to take such action, including, but not limited to, hiring, reinstatement or upgrading of employees, with or without back pay, restoration to membership in any respondent labor organization, as, in the judgment of the commission, will effectuate the purposes of this part, and including a requirement for report of the manner of compliance.”

2.  We take no position on whether that portion of the regulation is valid which provides for an award of compensatory damages in addition to back pay.

3.  FEHA is essentially a consolidation of law concerning employment discrimination and housing discrimination which had not previously been codified in the Government Code. In particular, FEHA combines the now-repealed Fair Employment Practices Act (formerly Lab.Code, s 1410 et seq.) and the now-repealed Rumford Fair Housing Act (formerly Health & Saf.Code, s 35700 et seq.).

4.  The motion also sought to strike certain portions of the prayer of the complaint which referred to general and special damages as well as punitive damages. Because the prayer as such provides no basis for relief, the presence or absence there of requests for general and special damages is of no significance in the adjudication of that issue.

5.  Section 12920 reads:“It is hereby declared as the public policy of this state that it is necessary to protect and safeguard the right and opportunity of all persons to seek, obtain, and hold employment without discrimination or abridgment on account of race, religious creed, color, national origin, ancestry, physical handicap, medical condition, marital status, sex, or age.“It is recognized that the practice of denying employment opportunity and discriminating in the terms of employment for such reasons foments domestic strife and unrest, deprives the state of the fullest utilization of its capacities for development and advance, and substantially and adversely affects the interest of employees, employers, and the public in general.“Further, the practice of discrimination because of race, color, religion, sex, marital status, national origin, or ancestry in housing accommodations is declared to be against public policy.“It is the purpose of this part to provide effective remedies which will eliminate such discriminatory practices.“This part shall be deemed an exercise of the police power of the state for the protection of the welfare, health, and peace of the people of this state.”

6.  (Stats.1959, ch. 1681, s 1, p. 4074.) The Hawkins Act was originally codified in Health and Safety Code section 35700 et seq., but was repealed in 1963 and replaced in the Health and Safety Code by the Rumford Fair Housing Act. (Stats.1963, ch. 1853, p. 3823, s 2.) In 1980 the provisions of the Rumford Act in Health and Safety Code section 35700 et seq. were repealed and essentially reincorporated in FEHA. (Gov.Code, s 12900 et seq.)

7.  (Stats.1959, ch. 1866, s 2, p. 4424.) The Unruh Civil Rights Act, as subsequently amended, is codified in Civil Code sections 51-52.

McDANIEL, Associate Justice.

KAUFMAN, Acting P. J., and MORRIS, J., concur.