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BROWN v. STATE PERSONNEL BOARD, F059897. (2012)

Court: Court of Appeals of California Number: incaco20120127116 Visitors: 8
Filed: Jan. 27, 2012
Latest Update: Jan. 27, 2012
Summary: NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS OPINION LEVY, J. Appellant, Auwana Brown, challenges two trial court rulings. The first ruling denied her petition for writ of mandate in November 2008. That petition sought to overturn a State Personnel Board (SPB) decision holding that Brown's former employer, respondent California State University (CSU), neither violated public policy nor unlawfully retaliated against Brown when it denied Brown's request to withdraw her resignation from employmen
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NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

OPINION

LEVY, J.

Appellant, Auwana Brown, challenges two trial court rulings. The first ruling denied her petition for writ of mandate in November 2008. That petition sought to overturn a State Personnel Board (SPB) decision holding that Brown's former employer, respondent California State University (CSU), neither violated public policy nor unlawfully retaliated against Brown when it denied Brown's request to withdraw her resignation from employment.

The second ruling sustained a demurrer filed by CSU to Brown's second amended complaint without leave to amend. In that complaint, Brown sought declaratory relief and damages based on allegations that CSU violated the Fair Employment and Housing Act in that its decision to deny Brown's request to withdraw her resignation was retaliatory. The court sustained the demurrer on the ground that the SPB had already found against Brown on the relevant issues and those SPB findings had not been overturned.

On appeal, Brown requests this court to order the trial court to grant her petition for writ of mandate and overturn the SPB decision. However, the SPB has not been a party to this action since November 2008. At that time, there was no issue remaining between Brown and the SPB and thus the order denying the writ petition was appealable. Since the time to appeal that order has long since passed, this court does not have jurisdiction to review the SPB decision.

The appeal on the ruling on the demurrer is timely. Nevertheless, a reversal of that ruling is dependent on a reversal of the SPB decision. Accordingly, the judgment will be affirmed.

BACKGROUND

Brown was employed by CSU as a police officer at the Fresno Campus (CSUF) between 1995 and 2000. In 1997, Brown filed a sexual harassment lawsuit against CSU based on the abusive behavior of former CSUF Chief of Police Willie Shell. The case went to mediation and settled in 1998. CSU agreed to pay Brown $275,000 in exchange for Brown's release of all claims and her agreement to resign her employment effective August 31, 2000.

Thereafter, the parties appeared in court for review and approval of the settlement terms. Brown was present with both of her attorneys. During the hearing, the attorneys recited the details of the settlement, including that Brown's employment would end in approximately two years on August 31, 2000, and that Brown would not be able to apply for other positions at CSUF or within the CSU system. The judge asked Brown if she understood the terms of the settlement and agreed to be bound by them. Brown stated that she did and the court approved the settlement. The settlement agreement was put in writing, signed by the parties, and approved by the attorneys. Brown dismissed her lawsuit and CSU paid Brown $275,000.

Brown was not the only CSUF employee to file a lawsuit against CSU and Shell. In June 2000, Brown testified for the plaintiffs in a racial discrimination and retaliation action brought by Daniel Horsford, Richard Snow and Steven King (Horsford et al.). On August 11, 2000, the jury returned a verdict in favor of those plaintiffs and awarded them $4.25 million.

On August 15, 2000, Brown wrote a letter to CSUF vice-president Benjamin Quillian stating that she was withdrawing her resignation. In response, Quillian reminded Brown that, by the terms of the settlement agreement, her resignation was irrevocable.

Brown filed a petition with the SPB to set aside her resignation. Following a hearing, the SPB dismissed the petition in January 2002 on the ground that it lacked jurisdiction to collaterally review Brown's resignation.

Brown next filed a petition for writ of mandate in the trial court. In April 2003, the trial court ruled on the petition and found that the settlement agreement was valid and was entered into voluntarily by both parties. However, the court remanded the matter to the SPB with directions to make further findings on why CSU insisted on precluding Brown from future employment with CSU and whether that provision violated state or federal law; whether the denial of Brown's request to withdraw her resignation was retaliatory; and whether Brown had a right to withdraw her resignation under Education Code section 89542, subdivision (a).

The parties stipulated that no additional evidence needed to be submitted to the SPB. Both sides prepared briefs and the matter was argued before the SPB in September 2006.

The SPB issued its decision on January 9, 2007, finding that CSU's refusal to accept Brown's withdrawal of her resignation did not violate public policy and was not retaliatory. The SPB also held that Brown failed to establish that her agreement to resign was the result of mistake, fraud, or duress and thus declined to set aside Brown's resignation pursuant to Education Code section 89542.

Brown then filed her second amended petition for writ of mandate in the trial court seeking to overturn the SPB's decision. Brown named the SPB as the respondent and CSU as the real party in interest. On November 14, 2008, the trial court issued its decision denying Brown's petition.

In March 2009, Brown filed her second amended complaint against CSU seeking damages for alleged violations of the Fair Employment and Housing Act. The SPB was not named as a party.

On September 11, 2009, Brown filed a writ petition in this court challenging the trial court's November 14, 2008, ruling. This court denied that petition on September 24, 2009.

CSU demurred to the second amended complaint. The trial court sustained the demurrer without leave to amend on December 9, 2009. The court concluded that the SPB's findings were binding on Brown and that those findings eliminated necessary elements of Brown's causes of action.

Judgment was entered in CSU's favor on January 14, 2010, and Brown filed her notice of appeal from that judgment on February 19, 2010.

DISCUSSION

1. The purported appeal from the November 14, 2008, order denying Brown's writ petition is untimely as to the SPB.

The SPB has not been a party to this litigation since the trial court denied Brown's second petition for writ of mandate on November 14, 2008. That order left no issue remaining to be determined as between Brown and the SPB. As noted above, the SPB was not named as a party to Brown's second amended complaint filed in March 2009.

When a case involves multiple parties, an order that leaves no issue remaining to be determined as to one party is considered final as to that party. (Nguyen v. Calhoun (2003) 105 Cal.App.4th 428, 437.) Where, as here, an order resolves all issues between the plaintiff and one of the two defendants, that order is immediately appealable even though the action is still pending against the second defendant. (Millsap v. Federal Express Corp. (1991) 227 Cal.App.3d 425, 429-430.)

An order denying a writ petition is properly treated as a final judgment. (Laraway v. Pasadena Unified School Dist. (2002) 98 Cal.App.4th 579, 583.) It does not require further action, such as the preparation of another order or judgment. (Ibid.) Accordingly, the November 14, 2008, order constituted a final judgment as to the SPB and the time for filing the appeal began to run. The subsequent judgment filed January 14, 2010, that recited the November 14, 2008, order did not restart or extend the time to appeal that order. (Ibid.) Thus, the February 19, 2010, notice of appeal, not being filed within 180 days of the November 14, 2008, order was not timely as to that order. Therefore, this court does not have jurisdiction to hear the appeal of the SPB decision. (Id. at p. 582.)

2. Even if the notice of appeal were timely, the November 14, 2008, order would be affirmed.

a. Standard of review.

The SPB derives its adjudicatory authority from the state Constitution rather than from a legislative enactment. (State Personnel Bd. v. Department of Personnel Admin. (2005) 37 Cal.4th 512, 522.) Consequently, a trial court considering a petition for administrative mandate must defer to the SPB's factual findings if they are supported by substantial evidence. (Ibid.)

In reviewing an SPB decision, the appellate court stands in the same shoes as the trial court, applying the substantial evidence rule. (California Dept. of Corrections v. State Personnel Bd. (2004) 121 Cal.App.4th 1601, 1611.) Accordingly, the appellate court does not reweigh the evidence and must indulge in all presumptions and resolve all conflicts in favor of the SPB's decision. (Ibid.)

Insofar as the appeal presents questions of law, review is de novo. (Alameida v. State Personnel Bd. (2004) 120 Cal.App.4th 46, 52.) Nevertheless, the appellate court will respect, although not necessarily defer to, the SPB's interpretations of governing statutes. (California Dept. of Corrections v. State Personnel Bd., supra, 121 Cal.App.4th at p. 1611.)

Brown argues that, because the SPB decision affected a fundamental vested right, the trial court was required to exercise its independent judgment on the evidence. However, that standard applies to adjudicatory decisions of state agencies of legislative origin. (Strumsky v. San Diego County Employees Retirement Assn. (1974) 11 Cal.3d 28, 32; Bixby v. Pierno (1971) 4 Cal.3d 130, 134.) As noted above, the SPB is "`a statewide administrative agency endowed by the Constitution with quasi-judicial powers.'" (Alameida v. State Personnel Bd., supra, 120 Cal.App.4th at p. 52.) Thus, both the trial court and this court review an SPB decision under the substantial evidence standard of review.

b. The settlement agreement did not violate Business and Professions Code section 16600.

As discussed above, as part of the settlement with CSU, Brown agreed to resign from employment effective August 31, 2000, and to never seek employment with CSU. Brown argues that these resignation and "no hire" provisions violate Business and Professions Code section 16600 and therefore should be severed from the settlement agreement.

Business and Professions Code section 16600 provides that, with certain exceptions, "every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void." This section "evinces a settled legislative policy in favor of open competition and employee mobility." (Edwards v. Arthur Andersen LLP (2008) 44 Cal.4th 937, 946.) In general, an employer cannot by contract restrain a former employee from engaging in his or her profession, trade or business. (Ibid.)

Here, however, the "no hire" provision does not prohibit Brown from working as a police officer with any public agency other than her former employer, CSU. Brown is not restricted from competing with CSU or moving on to work for another employer as a police officer. (Cf. D'Sa v. Playhut, Inc. (2000) 85 Cal.App.4th 927, 933.) Contrary to Brown's position, she still retains the right to pursue any lawful employment and enterprise of her choice, just not with her former employer. (Cf. Metro Traffic Control, Inc. v. Shadow Traffic Network (1994) 22 Cal.App.4th 853, 859.) Thus, the settlement agreement does not violate Business and Professions Code section 16600.

c. The "no hire" and resignation provisions are facially valid.

Brown contends that CSU's requirement that she irrevocably resign and agree not to apply for other positions within the CSU system violated public policies against: employment discrimination (Gov. Code, § 12900 et seq.); retaliation for having disclosed improper governmental activities (Gov. Code, § 8547.12); retaliation for having made a report of suspected unlawful conduct to a governmental agency (Lab. Code, § 1102.5); and forfeiture of property rights in public employment.

However, these provisions were part of a carefully negotiated settlement. There is a strong public policy favoring settling of disputes. (Kaufman v. Goldman (2011) 195 Cal.App.4th 734, 745.) Accordingly, a well-established policy in the law is to discourage litigation and favor settlement, especially pretrial settlements because they diminish the expense of litigation. (Ibid.) Enforcing settlement agreements promotes this public policy.

A settlement agreement entered into by parties to litigation is a contract. (Kaufman v. Goldman, supra, 195 Cal.App.4th at p. 745.) Freedom of contract is an important principle. Therefore, courts should not blithely apply public policy reasons to void these contract provisions. (Ibid.) Moreover, a settlement agreement is presumptively valid. (Village Northridge Homeowners Assn. v. State Farm Fire & Casualty Co. (2010) 50 Cal.4th 913, 930.) Thus, the court should exercise the power to void a contract only where the case is free from doubt. (Kaufman v. Goldman, supra, 195 Cal.App.4th at p. 746.)

Here, there is no indication that the resignation and "no hire" provisions were unilaterally included by CSU and were imposed for discriminatory or retaliatory purposes. Rather, as noted by the SPB and the trial court, the terms of the settlement agreement "`were the result of a free and voluntary decision arising out of negotiations through counsel and with adequate consideration.'" Following mediation while represented by two attorneys, Brown agreed to the resignation and "no hire" provisions and to dismiss her case in exchange for $275,000. Brown agreed to the terms in open court and, when she signed the written agreement, acknowledged that she had read it, understood it, and was entering it voluntarily. The SPB further found that Brown had failed to establish that her agreement to resign was the result of a mistake, fraud, or duress, or was otherwise involuntary. Under these circumstances, both the SPB and the trial court correctly concluded that Brown had failed to show, as a matter of law, that the settlement agreement violated an established public policy.

d. Substantial evidence supports the finding that CSU did not retaliate against Brown.

Brown's remaining arguments are dependent on finding that CSU's refusal to permit her to withdraw her resignation was retaliatory. According to Brown, CSU retaliated against her based on her testifying against CSU in the Horsford et al. trial shortly before she sought to revoke her resignation.

Brown contends that the trial court erred procedurally by using an improper standard of review. According to Brown, the trial court was required to exercise its independent judgment on the evidence. However, as discussed above, substantial evidence is the correct standard of review in this case.

On the merits, both the SPB and the trial court concluded that Brown's claim of retaliation based on her testimony in the Horsford et al. trial was based on speculation, not evidence. The record supports this finding. First, Brown voluntarily agreed to resign approximately two years before this testimony was given. Second, when CSU refused to permit Brown to withdraw her resignation, it was merely holding Brown to the terms of the settlement agreement, an agreement that she entered into voluntarily.

3. The demurrer to Brown's second amended complaint was properly sustained without leave to amend.

Brown's second amended complaint alleges three causes of action against CSU, declaratory relief; retaliation for opposing a practice of discrimination, harassment and retaliation; and failure to take all reasonable steps to prevent discrimination, harassment and retaliation. These causes of action are dependent on finding that the resignation and "no hire" provisions of the settlement agreement are void and unenforceable and that CSU's refusal to permit Brown to withdraw her resignation was retaliatory. CSU demurred to the complaint.

In ruling on the demurrer, the trial court concluded that Brown was bound by the SPB's findings including (1) "that Brown `failed to demonstrate that the resignation provision of the settlement agreement violates the policies set forth in [the Fair Employment and Housing Act]' ..."; (2) "that Brown presented no evidence to indicate that any provision of the settlement agreement was the result of mistake, fraud, duress, or undue influence or that, for any other reason, Brown's resignation was not a result of a free, voluntary, and binding act on her part ..."; and (3) "while CSUF may have previously permitted other employees to withdraw their resignations, Brown presented no evidence indicating CSUF had ever done so when the resignation was tendered as part of a court-approved settlement agreement and thus Brown had presented no evidence, save for her speculative belief, that CSUF had refused to permit her to withdraw her resignation because CSUF was upset with her because she testified against CSUF in the Horsford litigation ...." The court held that these adverse findings precluded Brown from re-litigating them in the "guise of `independent subsequent act[s]' as retaliation under the [Fair Employment Housing Act]" in her second amended complaint. In other words, the SPB findings eliminated necessary elements of Brown's case. Therefore, the trial court sustained the demurrer without leave to amend.

Brown first contends that, because the SPB findings were not based on substantial evidence and the SPB and the trial court made prejudicial errors of law, this court must reverse the sustaining of CSU's demurrer. However, as discussed above, those SPB findings are final. Moreover, substantial evidence supports the SPB's findings and no such errors occurred.

Brown further argues that, as a state employee, she is not precluded from pursuing both internal civil service remedies and those available under the Fair Employment and Housing Act. Brown is correct that state employees may pursue their claims of employment discrimination with either the SPB or the Department of Fair Employment and Housing, or both. (Ruiz v. Department of Corrections (2000) 77 Cal.App.4th 891, 900.) Nevertheless, when employees have availed themselves of the administrative remedies and have received an adverse quasi-judicial finding, that finding is binding on subsequent discrimination claims under the Fair Employment and Housing Act unless set aside through a timely mandamus petition. (Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074, 1090.) Thus, if issues decided by the SPB eliminate a necessary element of the employee's Fair Employment and Housing Act case, the doctrine of collateral estoppel precludes the litigation. (George v. California Unemployment Ins. Appeals Bd. (2009) 179 Cal.App.4th 1475, 1479.)

Here, the SPB findings eliminated necessary elements of Brown's second amended complaint. Accordingly, the trial court properly sustained the demurrer without leave to amend.

DISPOSITION

The judgment is affirmed. Costs on appeal are awarded to respondent Board of Trustees of the California State University.

WISEMAN, Acting P.J. and KANE, J., concurs.

Source:  Leagle

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