Opinion
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County No. BC421702, Michelle R. Rosenblatt, Judge. Reversed and remanded with directions.
Susan D. Salisbury for Plaintiff and Appellant.
Carpenter, Rothans & Dumont, Justin Reade Sarno and Louis R. Dumont for Defendants and Respondents, Antelope Valley Community College District, Patricia Marquez Sandoval, Tom Louis O’Neil, Melanie Parker and Irit Gat.
PERLUSS, P. J.
Payam Heidary appeals from the trial court’s dismissal of his action for discrimination and wrongful termination against the Antelope Valley Community College District (sued as Antelope Valley College) (District) and several of its employees (collectively AVC parties) after the trial court sustained a demurrer to the complaint without leave to amend for failure to exhaust administrative and judicial remedies. We reverse and remand with directions to stay the action pending completion by Heidary of the District’s internal grievance procedure.
FACTUAL AND PROCEDURAL BACKGROUND
1. Heidary’s Employment at Antelope Valley College
Heidary, a Muslim of Middle Eastern (Iranian) descent, was hired in August 2005 to teach psychology-related courses at Antelope Valley College. Heidary was a full-time, nontenured employee; his employment was subject to the provisions of a collective bargaining agreement between the District and the Antelope Valley College Federation of Teachers.
Our description of the factual background for Heidary’s claims is based on the allegations in his complaint, which we accept as true to determine whether the demurrer should have been sustained or overruled. (Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 373; Casterson v. Superior Court (2002) 101 Cal.App.4th 177, 182-183 [“[t]he reviewing court accepts as true all facts properly pleaded in the complaint in order to determine whether the demurrer should be overruled”]; see Mack v. Soung (2000) 80 Cal.App.4th 966, 971 [all properly pleaded allegations deemed true, regardless of plaintiff’s ability to later prove them].)
Antelope Valley Community College District maintains a system for awarding tenure to teaching faculty after they have successfully completed four years of service at the college. According to Heidary, he received only positive evaluations during his first two years of teaching. He began to receive serious criticism in his third year, however, when the composition of his tenure review committee changed, particularly from Patricia Marquez Sandoval, a tenured psychology professor who also held various management positions at the college. Heidary believed Professor Sandoval’s complaints about minor matters were motivated by her prejudice against him because he was an Iranian-American male.
In November 2007 Heidary filed an internal grievance alleging Professor Sandoval was discriminating against him and requesting her removal from his tenure review committee. The complaint was investigated by the college’s human resources department. Heidary also filed a charge of discrimination (based on sex and national origin) and retaliation with the California Department of Fair Employment and Housing (DFEH); he received a notice of right to sue on September 17, 2008.
Professor Sandoval resigned from Heidary’s tenure review committee during Heidary’s fourth year of employment at Antelope Valley College, but “baseless complaints” and criticism of Heidary’s teaching methods continued. In addition, Heidary alleges, Professor Sandoval “accus[ed] him of having a website that looked like a match.com advertisement” although she had never made similar accusations against female professors. Heidary alleges he was also subjected to other forms of discriminatory treatment: Other college employees were given a key to the building where faculty mail was received, but he was not, preventing him from checking his mailbox when the building was closed. His complaint of toxic dust in a classroom was dismissed without medical verification, while a white male employee’s similar complaint was not. The continued exposure to toxic dust, in turn, led to respiratory problems. Heidary filed a worker’s compensation claim in connection with his injury and notified the tenure committee of his work-related disability. No accommodations were made.
Notwithstanding Heidary’s efforts to comply with the various demands made of him to modify his teaching methods (even though he believed they lacked merit), in December 2008, midway through his fourth year of employment, the tenure committee recommended denial of tenure based on “lack of collegiality.” Heidary was terminated from his position on March 9, 2009 (although it appears he completed his teaching assignments through June 2009).
2. Heidary’s Administrative Claims and Complaint for Damages
Following the decision to deny him tenure and to terminate his employment at Antelope Valley College, Heidary filed a second discrimination complaint with DFEH, alleging retaliation and discrimination based on sex, disability, national origin and religion. He received a second notice of right to sue on August 20, 2009.
In the meantime, on March 12, 2009 Heidary initiated an internal administrative grievance procedure concerning the denial of tenure with the Office of Administrative Hearings (OAH). That matter was scheduled for a trial setting conference on July 23, 2009 and a prehearing conference on September 28, 2009. Trial before an administrative law judge was to begin on November 2, 2009.
On September 15, 2009 Heidary filed a complaint in superior court for unlawful discrimination on the basis of sex, religion and national origin in violation of the Fair Employment and Housing Act (FEHA) (Gov. Code, § 12940 et seq.), wrongful termination in violation of FEHA, discrimination and wrongful termination in violation of public policy prohibiting discrimination, retaliation in violation of public policy expressed in Labor Code section 132a, disability discrimination in violation of FEHA and intentional and negligent infliction of emotional harm.
Labor Code section 132a declares it the policy of California that “there should not be discrimination against workers who are injured in the course and scope of their employment” and makes it unlawful for an employer to retaliate against any employee because he or she has filed or made known his or her intention to file a claim for workers’ compensation with his or her employer. (See generally Arteaga v. Brink’s Inc. (2008) 163 Cal.App.4th 327, 356-357.)
The AVC parties demurred to the complaint on various grounds. The demurrer noted, for example, the complaint failed to attribute any particular action or inaction to the three individuals other than Professor Sandoval named as defendants-Tom Louis O’Neil, Melanie Parker and Irit Gat-and argued under Reno v. Baird (1998) 18 Cal.4th 640 a supervisor or other employee cannot be sued personally for discrimination in employment under FEHA or in a common law cause of action for violation of the public policy expressed in FEHA by an individual employed by a corporate or institutional employer. (See also Jones v. The Lodge at Torrey Pines Partnership (2008) 42 Cal.4th 1158, 1160 [applying rule precluding personal liability for nonemployer individuals for discrimination under FEHA to claims for retaliation].) The primary contention advanced by the AVC parties’ demurrer was that Heidary had failed to exhaust his administrative and judicial remedies prior to filing suit, citing among other authorities Westlake Community Hosp. v. Superior Court (1976) 17 Cal.3d 465 (Westlake), Johnson v. City of Loma Linda (2000) 24 Cal.4th 61 and Page v. Los Angeles County Probation Dept. (2004) 123 Cal.App.4th 1135 (Page). The demurrer was supported by a request for judicial notice, which attached several documents confirming Heidary’s ongoing participation in the administrative proceedings identified as the basis for the exhaustion argument.
3. The Trial Court’s Order Sustaining the Demurrer and Dismissing the Lawsuit
Heidary filed an opposition to the AVC parties’ demurrer arguing, in part, his pursuit of a contractual hearing procedure did not deprive the court of jurisdiction to hear his discrimination claims and, citing Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074 (Schifando), by filing a charge of discrimination with DFEH and receiving a notice of right to sue, he had exhausted all administrative prerequisites to suit. The AVC parties filed a reply, and the court heard oral argument on December 21, 2009. The following day, December 22, 2009, the court issued its ruling and order, sustaining without leave to amend the demurrer based on failure to exhaust administrative and judicial remedies. (An amended ruling and order, correcting several typographical errors, was filed January 4, 2009.)
The court acknowledged under Schifando Heidary was not required to initiate the internal grievance process before the OAH challenging the District’s decision to deny tenure and terminate his employment and, instead, could have proceeded to file his lawsuit under FEHA. However, having voluntarily elected to proceed first with this administrative remedy, which involved evidentiary hearings before an administrative law judge, a decision by the District’s board of trustees and judicial review by administrative mandamus pursuant to Code of Civil Procedure section 1094.5, the court concluded he was required to exhaust the administrative and judicial remedies before filing this action. To allow concurrent administrative and judicial proceedings, the court explained, would defeat the purpose of giving aggrieved parties the option to pursue administrative remedies.
For the record the court also indicated the AVC parties’ demurrer was properly sustained on several other grounds that had been advanced. However, the court explained, were it not for its decision to dismiss the case for failure to exhaust administrative and judicial remedies, it would have granted leave to amend the defective causes of action except the common law wrongful termination claim, which the court ruled could not be advanced against a public entity under Government Code section 815 or its employees under Reno v. Baird, supra, 18 Cal.4th 640.
No order of dismissal was entered. Heidary filed a premature notice of appeal on January 21, 2010. (See Vibert v. Berger (1966) 64 Cal.2d 65, 67 [order sustaining demurrer without leave to amend is not an appealable order]; Hill v. City of Long Beach (1995) 33 Cal.App.4th 1684, 1695 [same].) On January 25, 2010, unaware that a notice of appeal had been filed (albeit from a nonappealable order), the trial court notified the parties it intended to reconsider its ruling on the demurrer. Because the claims against individual defendants O’Neil, Parker and Gat were not directly at issue in the administrative proceedings, the court proposed to sustain the demurrers as to them with leave to amend. Similarly, because the cause of action for infliction of emotional distress would not be specifically litigated in the administrative proceeding, the court proposed to sustain the demurrer as to that cause of action with leave to amend. In light of those pending claims, the court indicated its intent to grant the demurrer to the entire complaint based upon the failure to exhaust administrative and judicial remedies “without prejudice to the Plaintiff to amend at the conclusion of the administrative proceedings and after judicial remedies pursuant to CCP section 1094.5, if applicable, have been exhausted. Thus, there will be no dismissal of the complaint and no refiling will be required.” The court set a supplemental briefing schedule and scheduled a hearing on its reconsideration of the demurrer for March 12, 2010.
On January 29, 2010, having learned that a notice of appeal had been filed, but apparently not recognizing it was from a nonappealable order, the court withdrew its notice of intent to reconsider the ruling on demurrer and vacated the hearing date. On February 9, 2009, after receiving Heidary’s case information statement, which did not include a signed order of dismissal, the clerk of this court notified Heidary an order sustaining a demurrer without leave to amend is not appealable. On February 24, 2010, on a proposed judgment form prepared and submitted by counsel for the AVC parties, the trial court filed a judgment on behalf of the AVC parties stating “this entire action is dismissed without prejudice as against all defendants.” Pursuant to rule 8.104(e) of the California Rules of Court, we treat the premature notice of appeal as filed immediately after entry of the judgment on February 24, 2010.
DISCUSSION
1. Appealability
Generally, to constitute an appealable judgment an involuntary dismissal must be in writing signed by the court and must constitute a final determination of the rights of the parties in the dismissed action. (Code Civ. Proc., §§ 581d [dismissal ordered by the court “shall be in the form of a written order signed by the court”; “those orders when so filed shall constitute judgments”], 577 [“[a] judgment is the final determination of the rights of the parties in an action or proceeding”].) Here, the judgment on behalf of the AVC parties dismissing the action was involuntary and was effected by a writing signed by the court. Yet the dismissal was expressly made “without prejudice”-language plainly intended to permit Heidary to refile his action at the conclusion of the administrative proceedings and following any judicial review pursuant to Code of Civil Procedure section 1094.5, that is, after exhausting his administrative and judicial remedies. Is such an order a final determination of the rights of the parties that is appealable at this time? (Compare In re Tomi C. (1990) 218 Cal.App.3d 694, 698 [dismissal without prejudice did not reach merits and thus not appealable] with Topa Ins. Co. v. Fireman’s Fund Ins. Companies (1995) 39 Cal.App.4th 1331, 1336 [dismissal without prejudice appealable because the without-prejudice qualification was intended only to permit a subsequent new action based on new facts].)
Although the issue is by no means free from doubt, we conclude the dismissal of Heidary’s action is appealable. If the order had not recited it was without prejudice, the dismissal for failure to exhaust administrative remedies would be immediately appealable. (See, e.g., Campbell v. Regents of University of California (2005) 35 Cal.4th 311, 317 [reviewing order sustaining demurrer without leave to amend and dismissal of complaint for failure to exhaust administrative remedies]; Ortega v. Contra Costa Community College Dist. (2007) 156 Cal.App.4th 1073, 1086 [reversing order dismissing complaint for failure to exhaust administrative remedies].) Following such a dismissal, however, and putting aside the question of the binding or preclusive effect of any factual findings made in the administrative proceedings not set aside in an administrative mandamus proceeding pursuant to Code of Civil Procedure section 1094.5, Heidary would be able to file a new action reasserting the FEHA and FEHA-related tort claims alleged in the original action once he had exhausted available administrative remedies. (Cf. Caliber Bodyworks, Inc. v. Superior Court (2005) 134 Cal.App.4th 365, 383 & fn. 18.) The inclusion of the “without prejudice” language, in other words, is without practical significance. It should also be without legal significance in this case.
2. Standard of Review
On appeal from an order dismissing an action after the sustaining of a demurrer, we independently review the pleading to determine whether the facts alleged state a cause of action under any possible legal theory. (McCall v. PacifiCare of Cal., Inc. (2001) 25 Cal.4th 412, 415; Aubry v. Tri-City Hospital Dist. (1992) 2 Cal.4th 962, 967.) We give the complaint a reasonable interpretation, “treat[ing] the demurrer as admitting all material facts properly pleaded, ” but do not “assume the truth of contentions, deductions or conclusions of law.” (Aubry, at p. 967; accord, Zelig v. County of Los Angeles (2002) 27 Cal.4th 1112, 1126.) We liberally construe the pleading with a view to substantial justice between the parties. (Code Civ. Proc., § 452; Kotlar v. Hartford Fire Ins. Co. (2000) 83 Cal.App.4th 1116, 1120.)
3. The Trial Court Erred in Dismissing, Rather than Staying, Heidary’s Entire Complaint
“Exhaustion of administrative remedies is ‘a jurisdictional prerequisite to resort to the courts.’” (Johnson v. City of Loma Linda, supra, 24 Cal.4th at p. 70.) The trial court properly sustains a demurrer to the complaint if a plaintiff is required to exhaust available administrative remedies before filing suit in superior court and has not shown either that he or she attempted to do so or that an exception to the exhaustion requirement applies. (Campbell v. Regents of University of California, supra, 35 Cal.4th at p. 333 [affirming order sustaining demurrer without leave to amend and dismissal of complaint for failure to exhaust administrative remedies]; see Abelleira v. District Court of Appeal (1941) 17 Cal.2d 280, 293 [exhaustion requirement is jurisdictional]; California Correctional Peace Officers Assn. v. State Personnel Bd. (1995) 10 Cal.4th 1133, 1151 [same].) Heidary’s complaint, therefore, was properly dismissed if he was required to complete the administrative grievance procedure he initiated following his denial of tenure before pursuing the FEHA and FEHA-related claims asserted in his lawsuit against the AVC parties.
a. Antelope Valley College’s internal grievance procedure and Heidary’s grievance
i. The collective bargaining agreement
The collective bargaining agreement between the District and the Antelope Valley College Federation of Teachers provides internal administrative grievance procedures to contest a decision to terminate employment: “If the Board of Trustees’ decision is to terminate a probationary employee, allegations that the District made a decision that was unreasonable to a reasonable person or that the District in any way violated, misinterpreted or misapplied any of the policies and procedures regarding evaluation shall proceed to a hearing by an administrative law judge in accordance with Education Code section 87610.1(b) and 87740. [¶]... [¶] The hearing shall be conducted by an administrative law judge, who shall submit a proposed decision to the board on the sufficiency of the cause and shall recommend a settlement. However, the board shall make the final determination as to the sufficiency of the cause and the settlement. The findings of the administrative law judge shall not be binding on the governing board or on any court in future litigation. [¶]... [¶] The board’s decision following such a hearing shall be subject to judicial review pursuant to section 1094.5 of the Code of Civil Procedure.”
ii. The Education Code’s formal hearing procedures
Education Code section 87610.1, subdivision (b), adopted by reference by the governing collective bargaining agreement, provides in language substantially similar to that contained in the agreement, “Allegations that the community college district, in a decision to grant tenure, made a negative decision that to a reasonable person was unreasonable, or violated, misinterpreted, or misapplied, any of its policies and procedures concerning the evaluation of probationary employees shall be classified and procedurally addressed as grievances.... If there is no contractual grievance procedure resulting in arbitration, these allegations shall proceed to hearing in accordance with Section 87740.”
Education Code section 87740, subdivision (d), guarantees a contract employee the decision not to reemploy him or her for the ensuing college year “shall be for cause only, ” and subdivision (b) provides, “The employee may request a hearing to determine if there is cause for not reemploying him or her for the ensuing year.”
Education Code section 87740, subdivision (c), which establishes the procedures for determining Heidary’s grievance, provides, if a hearing is requested, the proceedings shall be conducted, with certain nonmaterial modifications in applicable time limits, in accordance with the provisions of the California Administrative Procedure Act governing administrative adjudications by statewide agencies. (Gov. Code, § 11500 et seq.) The governing board of the District has the powers of the “agency” in the formal adjudication process. (Ed. Code, § 87740, subd. (d); see Gov. Code, § 11500, subd. (a) [“[a]gency” includes the state boards, commissions, and officers to which this chapter is made applicable by law”].) In addition, Education Code section 87740, subdivision (c)(3), states, “The hearing shall be conducted by an administrative law judge who shall prepare a proposed decision, containing findings of fact and a determination as to whether the charges sustained by the evidence are related to the welfare of the colleges and the students thereof. The proposed decision shall be prepared for the governing board and shall contain a determination as to the sufficiency of the cause and a recommendation as to disposition. However, the governing board shall make the final determination as to the sufficiency of the cause and disposition. None of the findings, recommendations, or determinations contained in the proposed decision prepared by the administrative law judge shall be binding on the governing board or on any court in future litigation.”
iii. Exclusion of claims of discrimination
Article IV of the collective bargaining agreement, prohibiting discrimination against members of the Antelope Valley College Federation of Teachers in the course and scope of their employment on the basis of race, color, religion, creed, national origin, sex, age, marital or parental status, disability or membership or participation in an employee organization, provides, “Alleged violations of this article for which another administrative forum is provided, such as the Equal Employment Opportunity [Commission] or the Department of Fair Employment and Housing, shall not be subject to the grievance provisions of this agreement.”
We grant Heidary’s motion to take judicial notice of article IV of the collective bargaining agreement, non-discrimination.
iv. The progress of Heidary’s grievance
Heidary filed a grievance on March 12, 2009. The exact nature of Heidary’s grievance is not disclosed in the record on appeal. However, in a declaration submitted with his opposition to the AVC parties’ demurrer, Heidary’s trial counsel, who represents him in the administrative proceedings, as well as on appeal, averred, “The issue of discrimination is not an issue in [the grievance] hearing. The only issues in that hearing are those set forth in the grievance procedure-whether there were procedural violations in reaching the decision to deny tenure and whether the decision would appear unreasonable to a reasonable person.”
According to material submitted with a request for judicial notice in the trial court and referred to by the court in its ruling sustaining the AVC parties’ demurrer, a prehearing conference on Heidary’s grievance was held before an administrative law judge on September 28, 2009; and evidentiary hearings were scheduled to begin on November 2, 2009. The prehearing conference order stated, “The factual issues to be decided in the case are set forth in the March 12, 2009 Grievance. “ No further details of the grievance are provided. The appellate record does not indicate whether the hearing has been completed.
b. Schifando and the exhaustion requirement in cases alleging FEHA violations and FEHA-related claims
i. The exhaustion doctrine generally
A party generally must exhaust internal administrative remedies before resorting to the courts. (Coachella Valley Mosquito & Vector Control Dist. v. California Public Employment Relations Bd. (2005) 35 Cal.4th 1072, 1080; Abelleira v. District Court of Appeal, supra, 17 Cal.2d at pp. 292-293 [“[i]n brief, the rule is that where an administrative remedy is provided by statute, relief must be sought from the administrative body and this remedy exhausted before the courts will act”].) In Westlake, supra, 17 Cal.3d 465 the Supreme Court held a physician’s failure to pursue a hospital’s internal grievance process barred his civil suit for damages based on the hospital’s purportedly improper denial of staff privileges. “[A] doctor who has been denied hospital staff privileges must exhaust all available internal remedies before instituting any judicial action, including an action seeking only damages.” (Id. at p. 485.)
In Rojo v. Kliger (1990) 52 Cal.3d 65, in the course of explaining why Westlake did not mandate exhaustion of FEHA’s external administrative procedures before proceeding with a judicial action for the common law tort of wrongful discharge in violation of public policy, the Court confirmed that the Westlake internal exhaustion doctrine was not confined to employees or members of private associations and voluntary organizations, but also applied to public employees: “The ‘context’ to which Westlake properly applies is where the party or entity whose “quasi-judicial” determination is challenged-be it hospital, voluntary private or professional association, or public entity-has provided an internal remedy.” (Rojo, at p. 86; see Schifando, supra, 41 Cal.4th at p. 1091.)
The exhaustion doctrine serves several well-established functions. First, it allows the administrative agency an opportunity to redress the alleged wrong without resorting to costly litigation. (Sierra Club v. San Joaquin Local Agency Formation Com. (1999) 21 Cal.4th 489, 501.) Second, even where complete relief is not obtained, it can serve to reduce the scope of the litigation or possibly avoid litigation. (Ibid.; Westlake, supra, 17 Cal.3d at p. 476.) Third, an administrative remedy ordinarily provides a more economical and less formal forum to resolve disputes and provides an opportunity to mitigate damages. (Westlake, at p. 476; see also Rojo v. Kliger, supra, 52 Cal.3d at p. 83.) Finally, the exhaustion requirement promotes the development of a more complete factual record and allows the administrative agency or entity implicated in the claim an opportunity to apply its expertise, both of which assist later judicial review if necessary. (Sierra Club, at p. 501; Westlake, at p. 476; see Palmer v. Regents of University of California (2003) 107 Cal.App.4th 899, 905 [“Exhaustion of internal grievance procedures is required not because of contractual obligation but because of ‘compelling’ POLICY CONSIDERATIONS: ‘[A]n exhaustion of remedies requirement serves the salutary function of eliminating or mitigating damages. If an organization is given the opportunity quickly to determine through the operation of its internal procedures that it has committed error, it may be able to minimize, and sometimes eliminate, any monetary injury to the plaintiff by immediately reversing its initial decision and affording the aggrieved party all... rights; an individual should not be permitted to increase damages by foregoing available internal remedies.’”].)
ii. Exhaustion of judicial remedies
In Johnson v. City of Loma Linda, supra, 24 Cal.4th 61 the Supreme Court held, when an employee pursues the administrative remedies of a city charter or other local statute or internal grievance procedure and has received an adverse quasi-judicial finding, that finding is binding in the employee’s subsequent FEHA action in accordance with collateral estoppel principles unless challenged and set aside in a timely mandamus proceeding. (See id. at p. 76 [“[w]e conclude that when, as here, a public employee pursues administrative civil service remedies, receiving an adverse finding, and fails to have the finding set aside through judicial review procedures, the adverse finding is binding on discrimination claims under FEHA”]; see also Schifando, supra, 31 Cal.4th at p. 1090 [by requiring plaintiff to set aside adverse adjudicatory findings in mandamus proceeding before pursuing a civil action, “Johnson ... ensures that employees who choose to utilize internal procedures are not given a second ‘bite of the procedural apple’”].)
“This requirement of exhaustion of judicial remedies is to be distinguished from the requirement of exhaustion of administrative remedies. [Citation.] Exhaustion of administrative remedies is ‘a jurisdictional prerequisite to resort to the courts.’ [Citation.] Exhaustion of judicial remedies, on the other hand, is necessary to avoid giving binding ‘effect to the administrative agency’s decision, because that decision has achieved finality due to the aggrieved party’s failure to pursue the exclusive judicial remedy for reviewing administrative action.’” (Johnson v. City of Loma Linda, supra, 24 Cal.4th at p. 70; see Murray v. Alaska Airlines, Inc. (2010) 50 Cal.4th 860, 876 [“unless a party to ‘a quasi-judicial administrative agency proceeding’ exhausts available judicial remedies to challenge the adverse findings made in that proceeding, those findings may be binding in later civil actions”].) “Generally speaking, if a complainant fails to overturn an adverse administrative decision by writ of mandate, ‘and if the administrative proceeding possessed the requisite judicial character [citation], the administrative decision is binding in a later civil action brought in superior court.’” (Runyon v. Board of Trustees of California State University (2010) 48 Cal.4th 760, 773.)
iii. Schifando and the exhaustion requirement in FEHA cases
Notwithstanding the general rule requiring exhaustion of internal administrative remedies, in Schifando, supra, 31 Cal.4th 1074 the Supreme Court held a public employee who claims to have suffered employment-related discrimination need not exhaust a mandatory internal administrative remedy with his or her employer in addition to FEHA’s administrative remedies before filing a FEHA discrimination claim in superior court. The case involved an employee of the City of Los Angeles who had filed a FEHA action against the City alleging disability discrimination after receiving a right-to-sue letter. The City demurred on the ground the employee had not exhausted the City’s internal grievance procedures. In holding the employee was not required to exhaust the internal administrative procedures, the Supreme Court reasoned FEHA’s legislative intent of providing employees “‘the maximum opportunity to vindicate their civil rights against discrimination’” would be frustrated if employees were required to pursue both internal remedies and FEHA administrative remedies as a prerequisite to filing a FEHA action. (Schifando, at p. 1086, italics omitted.)
The Schifando Court reaffirmed its prior holdings, including Westlake, supra, 17 Cal.3d 465 and Moreno v. Cairns (1942) 20 Cal.2d 531, requiring a plaintiff to exhaust internal remedies before bringing common law claims in a judicial forum, but explained in those cases “the Legislature had not specifically mandated its own administrative review process, as in the FEHA.” (Schifando, supra, 31 Cal.4th at pp. 1091-1092.) The Court expressly recognized “the existence of potential procedural issues that might arise in the situation where an employee chooses to pursue both avenues of redress”-as Heidary has done here-but noted those issues were not before it. (Id. at p. 1092.) The Court also noted Schifando had filed only a FEHA claim. Accordingly, it did not decide whether his failure to exhaust the City’s internal administrative procedures would have barred a tort or contract claim based on the same acts by the City. (Schifando, at p. 1092, fn. 6.)
In Williams v. Housing Authority of Los Angeles (2004) 121 Cal.App.4th 708, decided eight months after Schifando, Division Three of this court, resolving one of the questions unanswered by Schifando, held a public employee who claims employment-related discrimination and asserts both FEHA claims and common law (nonstatutory) claims for wrongful termination in violation of public policy need not exhaust the internal administrative remedy provided by his or her employer with respect to the nonstatutory claims before filing a civil action: “Schifando’s exemption must also apply to FEHA-related nonstatutory claims when the resolution of those claims would have a preclusive impact on the FEHA claim. To require exhaustion of internal administrative remedies for those FEHA-related nonstatutory claims would unduly burden a public employee. A public employee would first have to successfully challenge the administrative findings in an administrative mandamus action, which might detrimentally impact the employee’s right to bring a FEHA claim, and his or her right under Schifando to choose the appropriate forum to pursue that claim.” (Williams, at pp. 713-714.)
Our colleagues in Division Three, however, rejected Williams’s expansive argument that, once a FEHA claim has been alleged, all other causes of action related to the same facts are exempt from the exhaustion requirement. (Williams v. Housing Authority of Los Angeles, supra, 121 Cal.App.4th at p. 729.) Rather, the court held the limited exception it recognized for FEHA-related nonstatutory claims-common law tort claims based upon an alleged violation of the public policy set out in FEHA (Williams, at p. 713, fn. 2)-did not eliminate the exhaustion requirement for nonstatutory causes of action not directly related to FEHA: “In order to fall within the internal exhaustion requirement exemption on a FEHA-related nonstatutory cause of action that we articulate here, the primary focus is not on whether the claim is based on the same set of facts, although such circumstance might well bear on the issue, but on whether the resolution of the nonstatutory claim will have a preclusive impact on the FEHA claim.” (Williams, at pp. 729-730.) By way of example, the court explained an employee who asserted he or she had been terminated based on race and who alleged theories of liability that included a FEHA cause of action and a cause of action for breach of an implied contract not to be terminated except for good cause would be required to exhaust his or her internal administrative remedy on the contract claim because an adverse determination on that claim would not necessarily have an adverse impact on the FEHA claim. (Ibid.)
Several months after the decision in Williams v. Housing Authority of Los Angeles, supra, 121 Cal.App.4th 708, Division Four of this court in Page, supra, 123 Cal.App.4th 1135, held, notwithstanding Schifando, an employee of the Los Angeles County Probation Department was barred by the exhaustion doctrine from pursuing damage claims alleging the county had discriminated against her and failed to accommodate her disability in violation of FEHA. The employee had initially filed a grievance with the Los Angeles County Civil Service Commission pursuant to the procedures specified in the county charter. A hearing was held; and the hearing officer made findings of fact in favor of the county, concluding the employee was unable to perform the essential functions of her position and the county had attempted to provide the employee with reasonable accommodation as mandated by FEHA by transferring her to a different position, which the employee had refused to accept. Before a final decision was issued by the Civil Service Commission, however, the employee received a right-to-sue letter from the DFEH and filed her FEHA action in superior court. The Court of Appeal affirmed the trial court’s order sustaining the county’s demurrer to the complaint without leave to amend on the ground that, although the employee was not required to pursue the grievance procedures provided in the county charter, once she did so, she was obligated to exhaust those procedures and to bring a mandamus action to set aside any adverse findings before proceeding with a FEHA action. (Page, at pp. 1142 1144.)
This court followed Page in Miller v. City of Los Angeles (2008) 169 Cal.App.4th 1373, holding a public employee may choose to bypass an internal administrative process to assert a FEHA claim in superior court, but has the burden to exhaust administrative and judicial remedies if he or she initiates those proceedings and pursues them through evidentiary hearings to a proposed decision. (Id. at p. 1382.) The former city employee in Miller had appealed his discharge to the Board of Civil Service Commissioners, but filed a “withdrawal and/or dismissal” of his appeal after participating in two days of evidentiary hearings and after receiving the hearing examiner’s report recommending approval of his discharge. We held the attempt to terminate the administrative proceedings came too late: “By the time he submitted this document, he too had participated in multiple hearings, cross-examined witnesses, presented evidence and received the lengthy report and recommendation of the hearing examiner. Under these circumstances, just as in Page, Miller was obligated to exhaust his judicial remedies, yet failed to do so.” (Miller, at p. 1382)
c. Heidary’s complaint should not have been dismissed in its entirety
Under Schifando, supra, 31 Cal.4th 1074 Heidary’s three statutory FEHA claims (the first, second and fifth causes of action) and under Williams v. Housing Authority of Los Angeles, supra, 121 Cal.App.4th 708 his FEHA-related common law causes of action for wrongful termination in violation of public policy against discrimination and intentional and negligent infliction of emotional harm (the third and sixth causes of action) were not subject to the requirement he exhaust his internal administrative remedies as well as obtain a right-to-sue letter. (See Williams, at p. 730, fn. 16 [“a plaintiff who brings a civil action alleging (1) a cause of action under FEHA on the grounds that he was terminated because of his race, (2) a [claim for] wrongful termination in violation of public policy based on the FEHA’s proscription against discrimination, and (3) a claim for intentional infliction of emotion distress, would be exempt from the internal administrative exhaustion [requirement] as to all three causes of action”].) Thus, as the AVC parties and the trial court recognized, Heidary had the option of pursing his damage claims in superior court after receiving a right-to-sue letter from the DFEH without first engaging in the internal grievance process authorized by the collective bargaining agreement and the Education Code.
Like the common law tort claims for wrongful demotion and constructive termination in violation of public policy at issue in Williams v. Housing Authority of Los Angeles, supra, 121 Cal.App.4th 708, which were based on Williams’s response to a civil subpoena in defiance of contrary instructions from his employer and were independent of his FEHA claims, Heidary’s fourth cause of action for retaliation in violation of public policy expressed in Labor Code section 132a, not FEHA, is not exempt from the internal exhaustion requirement simply because it has been joined with his FEHA claims. (Williams, at p. 731.)
Heidary’s basic contract claim, however-his challenge to the denial of tenure and decision to terminate his employment as not being based on “cause” (see Ed. Code, § 87740, subd. (d) [decision not to reemploy contract employee “shall be for cause only”])-is subject to the internal grievance procedures. That claim is essentially independent of Heidary’s FEHA claims, and under Williams is not exempt from the internal exhaustion requirement even if joined with the FEHA claims. (See Williams v. Housing Authority of Los Angeles, supra, 121 Cal.App.4th at pp. 729-730.) In fact, Heidary has not even asserted the contract claim in the superior court action.
Heidary has elected to pursue his denial of tenure/contract claim and, as required, has initiated the internal procedures in Education Code section 87740 and section 4.4 of the collective bargaining agreement. Had Heidary also asserted his claims of discrimination and retaliation in the internal administrative proceedings, even though not obligated to do so, under Page, supra, 123 Cal.App.4th 1135 and Miller v. City of Los Angeles, supra, 169 Cal.App.4th 1373, exhaustion of those administrative remedies would be required; and any adverse findings would have binding effect unless set aside in a proceeding under Code of Civil Procedure section 1094.5 under Johnson v. City of Loma Linda, supra, 24 Cal.4th 61. But Heidary did not-indeed, could not under article IV, section 2.0 of the collective bargaining agreement-assert his discrimination and retaliation claims in the administrative grievance procedures. Does that mean Heidary is entitled to litigate his FEHA and nonstatutory FEHA-related claims in superior court action while simultaneously pursuing his tenure-denial contract claim before an administrative law judge and then the District’s board of trustees?
Heidary contends the answer must be yes, initially challenging the adequacy of the statutory procedures for administrative review of his termination. In particular, Heidary argues this case is controlled by Ortega v. Contra Costa Community College Dist. (2007) 156 Cal.App.4th 1073, which held the trial court had erred in dismissing a former head football coach’s FEHA action against the community college district for failure to exhaust the internal grievance procedures provided in the collective bargaining agreement between the union representing the coach and the district, procedures that culminated in an arbitration. Ortega is plainly distinguishable. Relying on prior case law explaining that the union exercises control over the presentation of grievances under a collective bargaining agreement and that the union’s interests may not always coincide with an individual employee’s in the pursuit of his or her discrimination claim, the Ortega court held, notwithstanding Johnson v. City of Loma Linda, supra, 24 Cal.4th 61, and Page, supra, 123 Cal.App.4th 1135, neither administrative nor judicial exhaustion barred the coach’s state court FEHA action against the district even though he had initiated, but did not complete, the internal grievance procedures. (Ortega, at pp. 1085-1086.) However, the court of appeal carefully noted the statutory grievance procedure provided by Education Code section 87610.1 was not at issue in Ortega, as it is here: “Had Ortega pursued the relief provided for in the Education Code, Johnson and Page might well control the result, but he did not.” (Ortega, at p. 1085, fn. 8.)
Heidary also asserts the administrative grievance procedures authorized by Education Code sections 876101.1, subdivision (b), and 87740, applicable to Heidary’s denial-of-tenure claim under the express terms of the collective bargaining agreement, are somehow inadequate because the findings by the administrative law judge following the contested evidentiary hearing he initiated are not “binding” on the District’s governing board or the court. Heidary is correct the proposed decision by the administrative law judge is subject to review by the District’s governing board, which may adopt or reject the recommended disposition of the matter, and, therefore, is not final. But there is nothing unusual about this procedure in adjudicatory or quasi-judicial administrative proceedings. (See, e.g., Gov. Code, § 11517, subds. (a), (c) [in a contested case under the California Administrative Procedure Act, the agency may either hear the matter itself or refer the matter to an administrative law judge; if heard by an administrative law judge, “he or she shall prepare within 30 days after the case is submitted to him or her a proposed decision in a form that may be adopted by the agency as the final decision in the case”; the agency may adopt the decision, make technical or other minor changes and adopt it, or reject the proposed decision and decide the case upon the record with or without taking additional evidence]; see generally Johnson v. City of Loma Linda, supra, 24 Cal.4th at p. 71 [plaintiff’s internal administrative remedy consisted of city council review of findings by personnel board]; Castillo v. City of Los Angeles (2001) 92 Cal.App.4th 477, 479 [plaintiff’s internal administrative remedy consisted of evidentiary hearing before hearing examiner, who filed report with Los Angeles County Civil Service Commission; following affirmance by Commission and denial of mandate petition, adverse findings given collateral estoppel effect].)
As reflected in the prehearing conference order issued by the OAH administrative law judge in connection with Heidary’s grievance, the contested administrative hearing (which Heidary described in his opening brief as “still continuing”) allows testimony from live witnesses, exhibits, motions in limine and oral argument. A court reporter will be present at the hearing, and a transcript of the proceedings maintained. Heidary also concedes prehearing discovery is available, although he quibbles with the scope and timing allowed, complaining it is not as liberal as that permitted under the Code of Civil Procedure.
Moreover, the collective bargaining agreement specifically provides the governing board’s decision is subject to judicial review by petition for administrative mandamus under Code of Civil Procedure section 1094.5, a position confirmed by the District in its briefing to this court. (See Marcario v. County of Orange (2007) 155 Cal.App.4th 397, 407, fn. 4 [“The right to have an administrative decision reviewed by the court in a writ proceeding is substantial. In such proceedings, the court is empowered to both review the evidence-determining in some cases whether substantial evidence supports the agency’s factual findings, and in others conducting an independent evaluation of the weight of the evidence-and independently review the merits of any legal contentions.”].) Because Heidary elected to utilize this internal grievance procedure for his contract-based tenure claim, both he and the District will be bound by any adverse quasi-judicial findings made in that proceeding unless set aside by the court in a proceeding under Code of Civil Procedure section 1094.5.
To be sure, even if Heidary’s superior court action asserting discrimination and retaliation claims seeks to vindicate the same primary right as his denial-of-tenure grievance (compare Balasubramanian v. San Diego Community College Dist. (2000) 80 Cal.App.4th 977, 992 [“[t]he determinative factor in applying the primary right theory was the harm [plaintiff] suffered”; both plaintiff’s federal court discrimination claim and state court breach of contract claim “involved the primary right to be employed by District”] with George v. California Unemployment Ins. Appeals Bd. (2009) 179 Cal.App.4th 1475, 1483 [“[C]ase law recognizes two rights or interests at stake when a civil service employee challenges discipline or termination on discriminatory or retaliatory grounds. The primary right protected by the state civil service system is the right to continued employment, while the primary right protected by FEHA is the right to be free from invidious discrimination and from retaliation for opposing discrimination.”]), the doctrine of res judicata cannot bar Heidary’s FEHA action following completion of the grievance process because the discrimination and retaliation claims could not be heard in the administrative forum. (See Le Parc Community Assn. v. Workers’ Comp. Appeals Bd. (2003) 110 Cal.App.4th 1161, 1170 [“[a]n important exception to the general rule of indivisibility of a primary right permits a second action on a different legal theory if the plaintiff was precluded from asserting that theory in the first action because of limitations on the subject matter jurisdiction of the first forum”].) Thus, potential application of res judicata (claim preclusion) cannot serve as a basis for imposing an exhaustion requirement here.
Nonetheless, all of Heidary’s claims are grounded in the same basic set of facts, and there is a fundamental overlap in his theories for recovery. The key issue in both the internal grievance and the FEHA action is whether the denial of tenure and consequent decision not to reemploy Heidary was for good cause. A final determination of that issue in the administrative proceedings-whether favorable to Heidary or the District-could significantly reduce the scope of the superior court action through application of collateral estoppel (issue preclusion). (See Schifando, supra, 31 Cal.4th at p. 1090 [“[w]e serve judicial economy by giving collateral estoppel effect to appropriate administrative findings”]; Castillo v. City of Los Angeles, supra, 92 Cal.App.4th at p. 481 [discussing public policies furthered by application of issue preclusion to prevent relitigation of issues previously decided in administrative tribunal]; see generally Knickerbocker v. City of Stockton (1988) 199 Cal.App.3d 235, 242 [collateral estoppel or issue preclusion “bars the relitigating of issues which were previously resolved in an administrative hearing by an agency acting in a judicial capacity”].) Permitting both judicial and administrative actions to proceed at the same time, on the other hand, creates the very “procedural labyrinth” that concerned the Schifando Court (Schifando, at p. 1091) and threatens the possibility of inconsistent factual determinations and waste of scarce public resources.
A finding that Heidary was denied tenure for good cause does not necessarily bar his FEHA claims. For example, although Heidary might have engaged in acts of misconduct that, in the abstract, would constitute cause to terminate his employment-an issue that would be presented in the internal administrative grievance proceeding-if other employees guilty of the same misconduct were not treated similarly and also denied tenure, Heidary’s discrimination claim might well survive. Heidary also alleges unlawful discrimination in his treatment by the District prior to the decision to deny him tenure, an issue presumably not raised in the grievance proceedings.
At the end of his reply brief in this court, Heidary belatedly suggests, rather than dismiss his complaint for failure to exhaust administrative remedies, if the trial court had wanted to prevent the simultaneous litigation of the FEHA claims and the denial-of-tenure contract claim in two separate venues, the state court action should have been stayed pending completion of the internal grievance procedures. The AVC parties actually made the same proposal at the hearing on their demurrer; but Heidary’s counsel, anxious to commence civil discovery, objected at that time; and the trial court, lacking a formal motion for a stay, apparently believed it could not proceed in that manner without the consent of all parties. As discussed, the trial court itself, after issuing its order sustaining the demurrer without leave to amend, announced its intention to reconsider its ruling and, in effect, both sustain the demurrers and stay further proceedings without ordering a dismissal of the case, permitting it to resume with an amended complaint after completion of the administrative proceedings and any petition for writ of mandate under Code of Civil Procedure section 1094.5. Heidary’s premature filing of a notice of appeal and the trial court’s consequent belief it lacked jurisdiction to reconsider its order prevented the court from taking that action.
We agree a stay of proceedings, rather than dismissal of the action, is the appropriate response under the somewhat unusual circumstances of this case-where the mandated internal grievance procedures expressly exclude the possibility of Heidary presenting his claims of discrimination. Heidary elected both to pursue his contract claim through the grievance process and to exclude that claim from his superior court action. To require him to exhaust his limited administrative remedy as a prerequisite to filing his FEHA and nonstatutory FEHA-related claims appears inconsistent with the rationale of Schifando and Williams v. Housing Authority of Los Angeles. (See Schifando, supra, 31 Cal.4th at pp. 1085-1086 [FEHA’s legislative intent of providing employees “‘the maximum opportunity to vindicate their civil rights against discrimination’” would be frustrated if employees were required to pursue internal remedies in addition to the FEHA administrative remedies as a prerequisite to filing a FEHA action].) Yet for the reasons discussed, the concurrent litigation of the contract claim and discrimination claims in two separate forums undermines the public policies that generally support enforcement of an exhaustion requirement. A stay of the superior court action, rather than dismissal-the solution suggested by all parties and the trial court, albeit at different times-reconciles these conflicting principles. (Cf. Code Civ. Proc., § 1281.4 [when a trial court “has ordered arbitration of a controversy which is an issue involved in an action or proceeding pending before” the court, it “shall, upon motion of a party... stay the action or proceeding until an arbitration is had in accordance with the order to arbitrate”]; Heritage Provider Network, Inc. v. Superior Court (2008) 158 Cal.App.4th 1146, 1152 [“[a]ny party to a judicial proceeding ‘is entitled to a stay of those proceedings whenever (1) the arbitration of a controversy has been ordered, and (2) that controversy is also an issue involved in the pending judicial action’”].)
Accordingly, we reverse the order dismissing the action and remand with directions to vacate the order sustaining the AVC parties’ demurrer without leave to amend for failure to exhaust administrative and judicial remedies. The trial court previously indicated its intended rulings on several other grounds supporting the demurrer advanced by the AVC parties. On remand the court should formally rule on those issues and, with respect to all causes of action as to which the court either overrules the demurrer or sustains the demurrer with leave to amend, stay further proceedings pending completion by Heidary of the District’s internal grievance procedures.
DISPOSITION
The order dismissing the action is reversed and the cause remanded for further proceedings not inconsistent with this opinion. The parties are to bear their own costs on appeal.
We concur: WOODS, J., ZELON, J.