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To err is human, to defer sublime

Supreme Court chooses not to get involved

By J. Clark Kelso

J. Clark Kelso


Courts are not the center of government's policy-making apparatus. In our system of representative government, it is the legislature that is primarily charged with making policy choices, the executive branch implements those choices, and the judicial branch is responsible for applying those choices in the resolution of individual disputes except when constitutional boundaries are crossed.

Courts that ignore this division of labor and routinely cross into policy-making put their own legitimacy at risk. During its 2002-2003 term, the Supreme Court of California has had quite a few opportunities to cross that line, and in each case, it has wisely stayed within judicial boundaries. It has been a year of deference: deference to the legislature, deference to the governor, deference to the secretary of state, and deference to the people.

No, Virginia, this is not Florida

Supreme Court of California
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Santa Claus came early this year for political pundits who were unsuccessfully struggling to stir up public interest in next year's presidential race. Now, the recall is the thing. But let's be clear, California is not Florida, and for that, we can in part thank the Supreme Court.

I write this article on Aug. 11, 2003, just two days after the filing deadline for candidates for the gubernatorial recall and two days before the secretary of state certifies the final list of candidates. The mainstream press has been pounding us on a daily basis with claims of impending chaos, confusion and catastrophe.

Whatever one thinks about the merits of the recall, our state officials responsible for implementing the somewhat opaque constitutional and statutory provisions dealing with recalls have, by and large, been models of stability. Particular praise goes to Secretary of State Kevin Shelley and his staff who are charged with primary responsibility in election matters.

Naturally, the recall has generated a flurry of lawsuits, making sure that all of the state's election lawyers and scholars are fully employed during what would normally be an "off" year. The Supreme Court resolved its complement of suits quickly and decisively with a series of orders issued on Aug. 6.

Technically, the decisions in these cases were probably not on the merits since the cases arose on petitions for writs of mandate seeking immediate injunctive relief, and the Court decided only that the petitioners had not demonstrated a sufficient likelihood of success to warrant issuance of the alternative writ or an order to show cause.

But don't be fooled by the technicalities. From a state court perspective — and there are still several federal actions pending as of this writing — these were the critical decisions on the recall election, and the decisions were well considered by the Supreme Court.

Let's look at two of the decisions where the Court explained its reasoning.

In Frankel v. Shelley, ______, the Court rejected petitioners' assertion that the lieutenant governor should automatically succeed to the office of governor if a majority of voters voted in favor of the recall. Section 10 of Article V of the California Constitution provides that "the lieutenant governor shall become governor when a vacancy occurs in the office of governor."

Is there a "vacancy" when a recall is successful and a successor to the office is elected at the same time? According to the petitioners, the answer when a recall involves the governor could be, and should be, "yes."

Subdivision (a) of §15 of Article II provides that "An election to determine whether to recall an officer and, if appropriate, to elect a successor shall be called . . . and held not less than 60 days nor more than 80 days from the date of certification of sufficient signatures" (emphasis added). Petitioners claimed that when a recall was directed at the governor, it was not "appropriate" to elect a successor on the same ballot because §10 of Article V created an automatic mechanism for the lieutenant governor to succeed the governor.

The petitioners' reading of the "if appropriate" clause was not the most natural. Among other things, §17 of Article II specifically addresses what happens when a recall is directed at the governor (i.e., "the recall duties of [the governor's] office shall be performed by the lieutenant governor").

It seems a little far-fetched to think that the drafters of these provisions would have left the question of the lieutenant governor's succession to be handled by the very general "if appropriate" clause when the drafters clearly had before them the specific question of a gubernatorial recall. Why not simply provide that when a recall is against the governor, the lieutenant governor shall succeed the governor if the recall is successful?

If there were no other explanation for the "if appropriate" language in §15, the petitioners might have had a chance. But the Court correctly noted that, at the very least, the "if appropriate" language clearly encompassed the situation when a recall is directed at an appellate justice.

According to subdivision (c) of §15, no one is permitted to file as a candidate when a recall is directed at an appellate justice, and the vacancy created by a successful appellate justice recall is filled by a gubernatorial appointee. Since no one could file as a candidate in such a recall, it would not be "appropriate" to hold an election for a successor under subdivision (a). Having given meaning to the "if appropriate" clause, there was no reason to stretch its meaning to cover a recall against the governor.

Putting aside the niceties of interpretation, the decision shows the Court deferring to the people's constitutional interest in the recall process and the right to select a successor when the people decide that a recall is appropriate. A contrary decision would have put the Court significantly at odds with the public's reasonable expectations about how the recall was going to be conducted.

The second major challenge to the recall process came in Burton v. Shelley, _____, where the Court deferred to the secretary of state's decision that potential replacement candidates on the recall ballot who paid the $3,500 filing fee needed to secure only 65 signatures, a policy followed by the secretary's two immediate predecessors. The petitioner in the case sought to apply a different statute which would have required replacement candidates to secure 153,000 valid signatures to appear on the ballot.

The applicable statutes are desperately in need of clarification, and this will certainly be a topic for legislative consideration next year. The petitioner's interpretation was certainly plausible, and the chief justice, in dissent along with Justice Carlos Moreno, suggested another alternative which would have required 74,767 signatures.

The four-justice majority rejected these alternatives not so much because they were implausible or wrong, but because, as the majority explained, "The secretary of state is the constitutional officer charged with administering California's election laws."

True, the Court could have exercised its power to step into this dispute, just as the Florida courts did in the presidential election. But one of the lessons from Florida is that the courts are not particularly adept at creating and executing workable administrative orders in the heat, frenzy and complexity of a pending election.

Our Supreme Court took the wiser course by deferring to the secretary of state and inviting legislative attention after the recall has concluded.

We will see if other courts with pending recall cases adopt a similarly cautious approach.

Deference to parole decisions

One of the most contentious criminal justice issues for the past several years has been the struggle between the courts and Gov. Davis over his parole decisions. Apparently convinced that the governor was implementing an unlawful "no parole for murderers" policy, a number of lower courts had overruled several of the governor's parole denials. The battle was ultimately joined in the Supreme Court in In re Robert Rosenkrantz, 29 Cal.4th 616 (2002).

The governor won, hands down. The Court overturned the trial court's factual finding that the governor followed a blanket policy of denying parole to all prisoners convicted of murder. Noting that the governor had in fact granted parole in two such cases and had engaged in individualized analyses of each parole case before him, the Court held that the evidence did not support the trial court's finding.

In addition, the Court adopted an extremely narrow standard of review, largely deferring to the governor's discretion in resolving parole cases. According to the Court, a parole decision must be upheld so long as there is "some evidence" to support it.

As the Court noted, "the 'some evidence' standard is extremely deferential and reasonably cannot be compared to the standard of review involved in undertaking an independent assessment of the merits or in considering whether substantial evidence supports the findings underlying a gubernatorial decision."

The Court rejected the governor's separation of powers contention that his parole decisions were entirely insulated from judicial review, but the "some evidence" standard adopted by the Court shows just how much deference the governor is due.

Deferring to the legislature's policy choices

The interpretation and use of California's Unfair Competition Law has been a particularly controversial area for the last half-decade or so. During this period of time, the Supreme Court has waded into and through a swamp of sticky issues, including important decisions about private party standing (Stop Youth Addiction Inc. v. Lucky Stores Inc., __ Cal.4th __ (1998)), the standard for determining what constitutes "unfair" practices (Cel-Tech Communications Inc. v. Los Angeles Cellular Tel. Co., 973 P.2d 527 (1999)), the unavailability of a fluid recovery fund remedy under the UCL absent class certification (Kraus v. Trinity Management Services Inc., 23 Cal.45h 116 (2000)), and the use of the UCL as a basis for attacking a company's public relations campaign (Kasky v. Nike Inc., 27 Cal.4th 939 (2002)), a decision I criticized last year in this column on First Amendment grounds.

The overall pattern of these decisions has been one of deference to the legislature's policy choices as reflected in the statutory language. The UCL has more than its share of powerful critics, and business interests might have been hoping to find a more sympathetic ear from the Supreme Court (just as the business community has ultimately found a sympathetic ear from the United States Supreme Court in punitive damages cases).

But the Court has resisted the temptation to rewrite the statutes, forcing disappointed stakeholders either to live with the statute as written or seek amendments from the legislature.

Most recently, in March of this year, in a clarification of the Court's decision in Kraus v. Trinity Manage-ment Services Inc., the Court held that disgorgement is an appropriate remedy under the UCL only if it is a restitutionary disgorgement remedy, that is, a remedy where the plaintiff is recovering from the defendant money that was taken from the plaintiff or in which the plaintiff could assert a plausible ownership interest.

In Korea Supply Co. v. Lockheed Martin Corp., 29 Cal.4th 1134 (2003), the disappointed bidder for a government contract with the Republic of Korea sued its competitor, who was awarded the contract after it was revealed that the selection may have been influenced by bribes and sexual favors instead of an analysis of the merits of the bids. The plaintiff used the alleged violation of the Foreign Corrupt Practices Act as the basis for the UCL claim. The plaintiff sought to recover the profits its competitor realized on the contract with Korea, calling this remedy a form of disgorgement.

The Court rejected this claim, finding that the legislature did not intend to include what the Court called non-restitutionary disgorgement as a remedy. The Court quite properly recognized that if it permitted non-restitutionary disgorgement of the sort advocated by the plaintiff, it would be the functional equivalent of permitting plaintiff to obtain tort damages while bypassing the burden of proving the elements for a tort recovery under the more traditional common law claim for interference with prospective economic advantage.

The Court was concerned that the result could be that the UCL would be used as an all-purpose substitute for a tort or contract action, something the legislature never intended.

The decision in Korea Supply Company is important to UCL litigants because it substantially limits the scope of any restitutionary recovery under the UCL (particularly when the holding in Korea Supply Company is combined with the earlier holding in Kraus rejecting fluid recovery fund remedies under the UCL absent class certification). The court will permit restitution to injured persons and a disgorgement of profits that is restitutionary. It will not permit the plaintiff to expand remedies to include disgorgements that are not restitutionary and that appear to be the equivalent of a claim for tort damages.

This holding appropriately reflects the Court's deference to the language chosen by the legislature and the legislative history of the relevant provisions. The plaintiff in Korea Supply Company contended that the Court's broad equitable powers under the UCL's remedies provision could reasonably encompass a disgorgement remedy. The Court did not disagree that it had broad equitable powers under the UCL, but explained that "Notably absent from this argument... is any showing from the language or history of [Bus. & Prof. Code] §17203 that the legislature intended to authorize a disgorgement remedy that was not restitutionary in nature."

As of the date of this writing in early August, the legislature has before it several bills that might modify or overrule the decisions in Korea Supply Company and in Kraus.

If these bills are enacted, we can fully expect our Supreme Court to continue its pattern in UCL cases of deferring to the legislature's clearly expressed policy judgments. Stake-holders need to address themselves to the legislative process.

In Closing

At times, a little humility and deference is a good thing. Our Supreme Court is ultimately made stronger and more legitimate by its sensitivity to and respect for the other constitutional players in our complex system of government.

In this regard, it's been a good year for the Court.

J. Clark Kelso is a professor of law and director of the Capital Center for Government Law & Policy at the University of the Pacific McGeorge School of Law. He also serves as the chief information officer for the state of California and the interim director of the Department of General Services. The views expressed in this article are solely the personal views of the author.

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