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Navarra v. City of Oakland

California Court of Appeals, First District, Third Division
Mar 30, 2009
No. A121814 (Cal. Ct. App. Mar. 30, 2009)

Opinion


CARL J. NAVARRA, Plaintiff and Respondent, v. CITY OF OAKLAND, Defendant and Appellant. A121814 California Court of Appeal, First District, Third Division March 30, 2009

NOT TO BE PUBLISHED

Alameda County Super. Ct. No. RG03115060

McGuiness, P.J.

In an earlier appeal arising out of this personal injury case, we affirmed a judgment against defendant City of Oakland (City) in favor of plaintiff Carl J. Navarra. This appeal is from a writ of mandate directing the City to pay postjudgment interest using the 10 percent interest rate specified in the judgment. The City claims an incorrect rate of interest was included in the judgment as a result of clerical error, which may be corrected at any time. We disagree and, accordingly, affirm the judgment.

Navarra v. City of Oakland (Oct. 26, 2007, A113361) [nonpub. opn.].

Factual and Procedural Background

The underlying personal injury action arose out of a vehicular accident. Before trial, Navarra settled his claims against certain defendants for $1.1 million. The court withheld ruling on the City’s request for an offset against any judgment that might be entered against the City to account for the pretrial settlement with other defendants. At trial, the jury returned a verdict finding that Navarra was 1 percent at fault, one of the defendants who had settled was 50 percent at fault, and the City was 49 percent at fault. The jury found that Navarra had suffered a total of approximately $5.7 million in damages. The City’s share of the damages was roughly $2.74 million.

The jury awarded no damages to another plaintiff, Paula Eddy, for her claimed loss of love, companionship, and comfort.

Navarra submitted a proposed judgment reflecting that postjudgment interest would be calculated at the rate of 10 percent per annum. The trial court signed the judgment, which failed to address whether any offset would be allowed against the judgment for amounts previously paid by other defendants. There is no indication the original judgment was submitted to counsel for the City for approval as to form.

The City moved to vacate the judgment on the ground the court had failed to consider the offset issue. The court granted the motion, vacated the judgment, and held a hearing on the offset issue. Following the hearing, the court asked the parties to submit alternative judgments reflecting each party’s view of the correct amount of the offset.

Navarra’s counsel then prepared two forms of judgment, one reflecting the City’s position on the offset issue and the other reflecting Navarra’s position. Both forms of judgment provided for postjudgment interest at a rate of 10 percent. Counsel for the City approved both judgments as to form, with the caveat that he did not agree with the figure Navarra had proposed as an offset. The City’s counsel did not object to the rate of postjudgment interest reflected in the proposed judgments. The trial court approved and signed the judgment reflecting Navarra’s position on the offset issue.

The City appealed the judgment on a variety of grounds. However, the City did not raise any issue on appeal concerning the 10 percent interest rate reflected in the judgment. This court affirmed the judgment in full.

Following issuance of the remittitur, the City paid Navarra $3,162,311, which represented the damages of $2,742,459.91 awarded to Navarra plus postjudgment interest calculated at the rate of 7 percent per annum. Plaintiff thereafter filed a petition for writ of mandate in the trial court, claiming the City had a duty to pay the full amount of the judgment, including postjudgment interest calculated at a 10 percent rate of interest.

The City responded to the writ petition by seeking an ex parte order correcting the judgment on the ground the inclusion of a 10 percent rate was an inadvertent mistake of law and thus a “clerical error” that could be corrected even after an appeal. The City also demurred to the writ as well as opposing it on the merits.

The trial court denied the City’s request to correct the judgment, overruled the demurrer, and granted the petition for a writ of mandate. In its written order granting the writ of mandate, the court stated that “The error the City seeks to correct is not a clerical error.” The court added that there had been “no showing that the 10% interest provision was entered by the Court for any reason other than that the parties agreed to that provision in the proposed Judgment.” Further, the court ruled that “even if a motion to correct the judgment could be proper under CCP §473(d), the City delayed unreasonably in making such a request, and waived the error when it approved the form of the Judgment.” On May 13, 2008, the court entered a judgment in the amount of $168,204.91, reflecting the balance due on the judgment through April 22, 2008, after applying a 10 percent rate of interest to the damage award.

The trial judge who granted the writ of mandate and denied the City’s request to correct the judgment was different from the trial judge who entered the original judgment. A retired Marin County judge sitting as a judge pro tem presided over the trial and signed the original judgment.

Discussion

1. Standard of Review

In reviewing a trial court’s ruling on a petition for writ of mandate, we defer to findings that are backed by substantial evidence but conduct a de novo review of the lower court’s resolution of questions of law based on undisputed facts. (Evans v. Unemployment Ins. Appeals Bd. (1985) 39 Cal.3d 398, 407.)

2. Postjudgment Interest on Judgment Against Public Entity

There is no statute expressly stating that the rate of interest on a judgment against a public entity bears interest at the rate of 7 percent. Instead, our Supreme Court arrived at the conclusion the proper interest rate is 7 percent after reviewing the relevant constitutional and statutory provisions. (See California Fed. Savings & Loan Assn. v. City of Los Angeles (1995) 11 Cal.4th 342, 345-348.)

The California Constitution provides that the Legislature may set the rate of postjudgment interest at not more than 10 percent per annum, but it also provides that in the absence of an interest rate set by the Legislature the rate “shall be 7 percent per annum.” (Cal. Const., art. XV, § 1.) Under section 685.010, subdivision (a) of the Code of Civil Procedure, an interest rate of 10 percent is applied to judgments until they are satisfied. However, the article of the Government Code providing for the payment of judgments against local public entities specifically provides that a judgment against a local public entity is not enforceable under the title of the Code of Civil Procedure (commencing with section 680.010) that includes section 685.010. (Gov. Code, § 970.1, subd. (b).) Thus, according to the court in California Fed. Savings & Loan Assn. v. City of Los Angeles, supra, 11 Cal.4th at p. 347, the 10 percent interest rate in Code of Civil Procedure section 685.010 is inapplicable to judgments against local public entities. And, because the Legislature has not established a specific postjudgment interest rate for judgments against local public entities, the default rate of 7 percent applies, as specified in the California Constitution. (California Fed. Savings & Loan Assn. v. City of Los Angeles, supra, 11 Cal.4th at p. 348.)

See Gov. Code tit. 1, div. 3.6, part 5, chap. 2, art. 1.

A different rate of postjudgment interest applies to a judgment against a public entity when the entity elects to satisfy a judgment by making periodic payments. (See Gov. Code, § 984.) In such a case, the rate of interest applied each year on the unpaid balance of the judgment accrues at the same rate as one-year United States Treasury bills as of January 1 of that year. (Gov. Code, § 984, subd. (e)(2).) Here, the City did not elect to pay the judgment in periodic installments, assuming it was eligible to do so. (See Gov. Code, § 984, subd. (b) [periodic payment option only available to extent public entity is not insured for loss].)

Accordingly, the legal rate of interest to be applied to a judgment against a local public entity such as the City is 7 percent. Navarra does not contend otherwise. Rather, he argues the error in the judgment was judicial rather than clerical in nature and, as a consequence, may not be corrected at this late date.

A 7 percent rate likewise applies to judgments against the state or its agencies. (Gregory v. State Bd. of Control (1999) 73 Cal.App.4th 584, 599.)

3. Clerical Error

Under section 473, subdivision (d) of the Code of Civil Procedure, a court may correct “clerical mistakes in its judgment or orders as entered, so as to conform to the judgment or order directed.” A clerical error may be corrected at any time, including after a judgment is affirmed on appeal. (See Hennefer v. Butcher (1986) 182 Cal.App.3d 492, 506.)

The City contends that inclusion of the 10 percent interest rate in the judgment qualifies as a clerical error that may be corrected at any time. For the reasons that follow, we disagree that the error is clerical in nature.

“It is elementary that ‘[a] court can always correct a clerical, as distinguished from a judicial error which appears on the face of a decree, by a nunc pro tunc order. [Citation.] It cannot however, change an order which has become final even though made in error, if in fact the order made was that intended to be made.’ [Citation.] . . . ‘The test which distinguishes clerical error from possible judicial error is simply whether the challenged portion of the judgment was entered inadvertently (which is clerical error) versus advertently (which might be judicial error, but is not clerical error). [Citation.] Unless the challenged portion of the judgment was entered inadvertently, it cannot be challenged post judgment under the guise of correction of clerical error.” (Bell v. Farmers Ins. Exchange (2006) 135 Cal.App.4th 1138, 1144 (Bell).)

When a trial judge through inadvertence or mistake makes or signs a decision different from what was intended, the error is clerical and may be corrected just as a clerk’s error in transcribing a judgment may be corrected. (See 7 Witkin, Cal. Procedure (5th ed. 2008) Judgment § 69, p. 605.) Thus, for example, in Nathanson v. Murphy (1957) 147 Cal.App.2d 462, the appellate court upheld a nunc pro tunc trial court order modifying a clerical error in the date on which interest began to run. There, the court originally indicated that 7 percent interest would run from the date the plaintiff parted with money as a result of an alleged fraud. (Id. at pp. 463-464.) At a hearing on a new trial motion, the trial court expressed its intent to change the allowance of interest, such that interest would run only from the date of judgment. (Id. at p. 468.) However, this intent was not reflected in the judgment. Over two years later, the trial court entered a nunc pro tunc order declaring that interest should run only from the date of the judgment. (Id. at p. 464.) On appeal, the plaintiff challenged the trial court’s authority to enter the modification order. The appellate court rejected the contention and affirmed, stating: “The [order] did not correctly state what the judge had expressed as his intent. This was a clerical and not a judicial error. Therefore, the court had the power, at any time, to correct it, nunc pro tunc.” (Id. at p. 470.)

Here, unlike in Nathanson v. Murphy, the interest component of the judgment did not contradict an expressed intent of the court with regard to the rate of interest to be applied to the judgment. Instead, the facts of this case are much more like those in Bell, supra, 135 Cal.App.4th at pp. 1144-1145, in which our colleagues in Division One held that a trial court lacked authority to correct the prejudgment interest rate contained in a judgment long after the judgment was final.

In Bell, a class action involving entitlement to overtime compensation, a jury awarded the plaintiff class substantial damages for unpaid overtime compensation. (Bell, supra, 135 Cal.App.4th at p. 1141.) The judgment awarded prejudgment interest at the rate of 10 percent as provided in Civil Code section 3289 for breach of contract damages. (Bell, supra, at p. 1141.) The Court of Appeal affirmed the judgment in most respects and remanded the matter on certain narrow grounds. (Id. at p. 1142.) Following remand, the defendant-employer filed a motion for a nunc pro tunc order to determine the amount of prejudgment interest or, alternatively, to correct a clerical error in the judgment. The employer asserted that prejudgment interest should be calculated by using the 7 percent default interest rate specified by the California Constitution. (Ibid.)

The Court of Appeal in Bell rejected the contention the purported error in the prejudgment interest rate was clerical, pointing out that the parties had discussed the interest calculation in a dialogue with the court in which they had referred to a 10 percent interest rate. (Bell, supra, 135 Cal.App.4th at p. 1144.) Further, the court itself had used a 10 percent rate in posing hypotheticals and had stated its intention as to the award of interest at the conclusion of the hearing. (Ibid.) Thus, “The judgment precisely carried out the intent of the trial court’s ruling” and could not “be changed by a motion nunc pro tunc‘under the guise of correction of clerical error.’ [Citations.]” (Id. at p. 1145.)

In addition, the court noted that the parties had at one time addressed the prejudgment interest rate, among other issues, in a conference before a special master, that the employer had agreed before trial that a 10 percent prejudgment interest rate applied, that the employer had submitted a brief following trial that presupposed a 10 percent interest rate, and that the employer had failed to raise the issue of prejudgment interest in the prior appeal. (Bell, supra, 135 Cal.App.4th at p. 1145.)

In this case, as in Bell, the judgment carried out the intent of the parties and the court, as expressed in the proposed forms of judgment submitted to the court. There is nothing in the record to indicate that the parties or the court intended to apply a 7 percent interest rate to the judgment. The trial court could properly assume the parties both proposed to apply a 10 percent interest rate. In the absence of any indication otherwise, we must assume the trial court followed the parties’ recommendation and thus intended to enter the judgment, which included a 10 percent interest rate. The inclusion of a 10 percent interest rate was not “inadvertent,” because that rate was precisely what the parties had proposed and the court adopted.

The City nevertheless urges the error was inadvertent, relying upon Pettigrew v. Grand Rent-A-Car (1984) 154 Cal.App.3d 204 (Pettigrew). In Pettigrew, a jury returned a verdict for $150,000 against the defendant, and the court entered a judgment on the verdict in open court for that sum. (Id. at p. 207.) Approximately one month after the court denied a new trial motion and motion for judgment notwithstanding the verdict, the defendant sought to modify the judgment pursuant to Code of Civil Procedure section 473, claiming the Vehicle Code limited damages under the circumstances to $15,000. (Pettigrew, supra, 154 Cal.App.3d at p. 207.) The trial court granted the modification and the plaintiff appealed, contending Code of Civil Procedure section 473 did not allow a reduction in damages following a final judgment. (Pettigrew, supra, 154 Cal.App.3d at p. 207.) The appellate court disagreed, characterizing the error as a clerical mistake that could be corrected at any time. The Court of Appeal stated that the distinction between a clerical error and a judicial error turns on “ ‘whether it was the deliberate result of judicial reasoning and determination,’ ” relying upon Estate of Doane (1964) 62 Cal.2d 68, 71. (Pettigrew, supra, 154 Cal.App.3d at p. 209.) The court went on to conclude that the original judgment “clearly was not ‘the deliberate result of judicial reasoning and determination,’ ” because the record did not disclose why the trial court had chosen to enter a judgment in violation of the statutory limitation on damages. (Id. at p. 211.) The court reasoned: “It cannot be presumed that the court intended deliberately to render and enter a judgment which was contrary to law.” (Ibid.)

The City seizes upon Pettigrew, contending that the record here, like the record in Pettigrew, is silent as to why the trial court entered a judgment contrary to the law. In addition, the City has offered the declaration of its attorney who agreed to the proposed judgments as to form. He claims his focus was upon the offset issue and that “it did not occur” to him to check for other legal defects in the judgment. According to the City, because it cannot be presumed the court intended to enter a judgment contrary to law, the error must be considered inadvertent. We disagree.

Pettigrew clearly pushes the boundaries of what may be considered a clerical error. As Witkin recognizes, the case law supporting the decision constitutes a “startling departure from the established principles” on the question of what constitutes clerical error. (7 Witkin, Cal. Procedure, supra, § 72, p. 608.) Nonetheless, the City is not entitled to relief even under the analysis contained in Pettigrew.

The judgment in Pettigrew was entered orally on the record shortly after the jury reached its verdict, and the issue of statutory limits on damages was apparently never raised before entry of the judgment. Thus, the record was silent on the parties’ positions as well as the court’s intention concerning limits on damages. Here, by contrast, Navarra submitted, and the court signed, a proposed judgment allowing for postjudgment interest at the rate of 10 percent. Under the circumstances, it cannot be said the record was silent concerning the parties’ or the court’s intention regarding the rate of postjudgment interest. That intention was reflected in the proposed forms of judgment to which counsel for the City agreed as to form. As the trial court observed, there is nothing in the record to indicate the court allowed for postjudgment interest at a rate of 10 percent for any reason other than that the parties agreed to that provision in the proposed judgment.

When a court misconstrues the evidence, misapplies the law, or is even misled by counsel as to the facts or the law, any resulting error is judicial rather than clerical. (Tokio Marine & Fire Ins. Corp. v. Western Pacific Roofing Corp. (1999) 75 Cal.App.4th 110, 117-118.) The error here resulted from the court being misled by counsel as to the legal rate of postjudgment interest. The error was in the rendering, not the recording, of the judgment.

We conclude the error in allowing for postjudgment interest at a rate exceeding the legal rate of 7 percent was judicial rather than clerical in nature. As such, the error is not susceptible to correction under section 473, subdivision (d) of the Code of Civil Procedure.

4. Waiver/Forfeiture

The question remains whether the City may modify the judgment to correct the judicial error in entering a legally improper interest rate, notwithstanding the fact the judgment is final following an earlier appeal. The parties characterize the issue as whether the City has waived the right to seek modification.

There is little question but that the trial court lacked jurisdiction to modify the judgment to correct judicial error. “If the entry [of judgment] conforms to the judgment as rendered, and there is no clerical error in the rendition or entry, there can be no summary amendment by the court . . . no matter how wrong in law the decision may be. Judicial error, i.e., an erroneous decision, can only be rectified by the regular procedures for attack on judgment: motion for a new trial, motion to vacate judgment, appeal, or an independent action in equity. [Citations.]” (7 Witkin, Cal. Procedure, supra, § 65, p. 600.)

The City did not raise the interest rate issue in its prior appeal, nor did it pursue any of the other methods available to it to challenge a judicial error. For example, it could have pursued a motion under Code of Civil Procedure section 473, subdivision (b) within six months of the date of the judgment to correct error resulting from mistake, inadvertence, surprise, or excusable neglect. It did not do so. Instead, following the affirmance of the judgment on appeal, the City’s only remaining option was to challenge the legal error by characterizing it as clerical error under Code of Civil Procedure section 473, subdivision (d). However, as stated above, a court may not correct judicial error under the guise of correcting clerical error.

One could argue the judgment is unenforceable to the extent the postjudgment interest rate exceeds the maximum permitted by the California Constitution. This argument turns upon whether the court lacked jurisdiction to enter the judgment containing the 10 percent interest rate or merely exceeded its jurisdiction in doing so. “ ‘ “Lack of jurisdiction in its most fundamental or strict sense means an entire absence or power to hear or determine the case, an absence of authority over the subject matter or the parties.” [Citation.]’ [Citation.] By contrast, when a court has jurisdiction of the subject matter and the parties, actions in substantial disregard of constitutional or statutory limitations, or that deny fundamental rights or defenses, are acts in excess of jurisdiction. [Citation.]” (People v. Ramirez (2008) 159 Cal.App.4th 1412, 1426.)

“ ‘When a court lacks jurisdiction in a fundamental sense, an ensuing judgment is void and “thus vulnerable to direct or collateral attack at any time.” [Citation.]’ [Citation.] By contrast, when a court has fundamental jurisdiction to act but acts in excess of jurisdiction, its actions are merely voidable, “[t]hat is, its act or judgment is valid until it is set aside, and a party may be precluded from setting it aside by ‘principles of estoppel, disfavor of collateral attack or res judicata.” [Citation.]’ [Citation.] Whereas a lack of fundamental jurisdiction may be raised at any time, a challenge to a ruling in excess of jurisdiction is subject to forfeiture if not timely asserted. [Citation.] In the absence of exceptional circumstances, a party has no right to attack a voidable judgment long after it is final. [Citation.]” (People v. Ramirez, supra, 159 Cal.App.4th at p. 1422.)

Here, there is no contention the judgment is void or that the court lacked fundamental jurisdiction to act. Rather, the court merely exceeded its jurisdiction when it imposed an interest rate in excess of the rate specified in the California Constitution. The City may well have had grounds to challenge the imposition of an excessive interest rate in a timely motion or on appeal from the judgment. Despite Navarra’s contention otherwise, an attorney’s agreement to a judgment “as to form” does not alone constitute assent to be bound by the terms of the judgment. (Leupe v. Leupe (1942) 21 Cal.2d 145, 150-151.) An agreement as to form merely signifies that the proposed written order accurately memorializes the court’s ruling. (Cf. Cal. Rules of Court, rule 3.1312(a).) Thus, before the judgment was final, the City could have argued the trial court or this court was bound to correct legal error appearing on the face of the judgment, notwithstanding the City’s agreement to the judgment as to form. However, the City has offered no support for the contention that it retains the right to challenge legal error long after the judgment is final. Like other forms of legal error that constitute acts in excess of jurisdiction, the error is forfeited if not timely raised in the trial court or on appeal.

In this connection, it should be noted that Pettigrew is distinguishable from this case in one significant respect. There, the defendant sought to correct the judgment in the trial court even before the time to appeal had run. (See Pettigrew, supra, 154 Cal.App.3d at p. 207.) The appellate court observed that the statute limiting damages could have been invoked by noting the existence of the applicable statute “at any time up to and including an appeal.” (Id. at p. 211.) By contrast, here the City sought to correct the judgment after it was final following an appeal. In short, Pettigrew did not involve a forfeiture of the claim by failure to timely assert it, as is the case here.

The City contends waiver principles are inapplicable because a charter city is not subject to waiver or estoppel when the waiver is contrary to public policy. As the City correctly points out, to establish waiver, it must be shown that “the applicant has made a knowing, intelligent, and voluntary waiver in circumstances where the applicant might reasonably anticipate some benefit or advantage from the waiver, and if the waiver does not seriously compromise any public purpose . . . .” (Bickel v. City of Piedmont (1997) 16 Cal.4th 1040, 1050, abrogated by statute on another ground as stated in DeBerard Properties, Ltd. v. Lim (1999) 20 Cal.4th 659, 668.) The City argues that an even more stringent test for waiver applies in the case of a public entity, such that there must be clear and convincing evidence of an actual intention to relinquish a right.

While we do not necessarily disagree with the City’s recitation of general waiver rules, they are inapplicable here. The City confuses waiver with forfeiture. Although “waiver” is a term commonly used to describe a party’s loss of a right to assert a claim of error, “forfeiture” is the more technically accurate term. (See In re S.B. (2004) 32 Cal.4th 1287, 1293, fn. 2, superseded on other grounds by statute as stated in In re S.J. (2008) 167 Cal.App.4th 953, 962.) The “correct legal term for the loss of a right based on failure to timely assert it is ‘forfeiture,’ because a person who fails to preserve a claim forfeits that claim. In contrast, a waiver is the ‘ “intentional relinquishment or abandonment of a known right.” ’ [Citations.]” (In re S.B., supra, 167 Cal.App.4th at p. 1293, fn. 2.) Forfeiture may result from action or inaction but falls “short of express waiver that demonstrates acquiescence in the error. [Citations.]” (Shaw v. County of Santa Cruz (2008) 170 Cal.App.4th 229, 286.) In other words, a party may forfeit a claim of error regardless of whether it intended to do so.

Here, the City forfeited its claim of error by waiting until after the judgment was final to first assert it. A claim of legal error—even if the error constitutes an action in excess of the trial court’s jurisdiction—is forfeited if not timely asserted. (People v. Ramirez, supra, 159 Cal.App.4th at p. 1422.)

The City spends considerable effort arguing that its attorney did not have authority to bind the City to pay an interest rate in excess of the constitutional maximum. The argument appears to be premised on the assumption that the attorney’s consent “as to form” of the judgment amounted to an agreement on behalf of the City. As explained above, we agree with the City that such an agreement as to form does not necessarily amount to assent to be bound by the terms of the judgment. (Leupe v. Leupe, supra, 21 Cal.2d at pp. 150-151.) Our conclusion that the City forfeited its contention with regard to the proper rate of interest does not rest on an assumption that the City’s attorney had actual or apparent authority to agree on behalf of the City to pay an excessive rate of interest. The forfeiture resulted from a failure to raise the issue until after the judgment was final. It is irrelevant that the deputy city attorney purportedly lacked authority to agree to the higher interest rate. That argument should have been raised, if at all, before the judgment was final.

The City asks us to take judicial notice of certain provisions of the Oakland Municipal Code and the Oakland City Charter purportedly demonstrating that a deputy city attorney lacks authority to bind the city to a contract or settlement of a disputed matter. Although items such as these are properly the subject of a request for permissive judicial notice (see Evid. Code, § 452, subd. (b)), we decline to take judicial notice of them here because they are not relevant to our analysis. A claim that a judgment contains an erroneous provision resulting from judicial error is forfeited by failure to timely raise the claim, regardless of whether the party’s attorney lacked authority to consent to that provision on behalf of the client in a settlement of the matter.

5. Entitlement to Writ of Mandate

The City contends that a writ of mandate may not be issued to compel it to pay a postjudgment interest rate exceeding the legal rate. Ordinarily, we would agree that a writ of mandate directing a public entity to pay a judgment cannot specify a rate of postjudgment interest other than the legal rate. However, under the circumstances presented here, in which the interest rate is specified in a final, unappealable judgment, we must disagree with the City.

The City’s argument focuses on the language of two sections of the Government Code. Section 970.2 of the Government Code provides in relevant part that “A local public entity shall pay any judgment in the manner provided in this article.Section 970.1, subdivision (b) of the Government Code provides that a judgment “is not enforceable under Title 9 (commencing with Section 680.010) of Part 2 of the Code of Civil Procedure but is enforceable under this article after it becomes final.” In California Fed. Savings & Loan Assn. v. City of Los Angeles, supra, 11 Cal.4th at p. 347, our Supreme Court held that among the unenforceable provisions of Title 9 of Part 2 of the Code of Civil Procedure is the one establishing a 10 percent postjudgment interest rate.

The City claims that, taken together, the controlling legal authority and the applicable statutes provide that a postjudgment interest rate other than the legal rate of 7 percent is unenforceable. Thus, according to the City, no writ of mandate may issue to compel it to pay interest at an unenforceable rate.

Contrary to the City’s contention, the Supreme Court in California Fed. Savings & Loan Assn. v. City of Los Angeles did not hold that an interest rate other than the 7 percent rate specified in the California Constitution is unenforceable under any circumstances. Rather, the court merely held that a party may not enforce a judgment against a local public entity under the procedures outlined in the Code of Civil Procedure regarding enforcement of judgments. (California Fed. Savings & Loan Assn. v. City of Los Angeles, supra, 11 Cal.4th at p. 347.) The court did not address whether a judgment specifying a postjudgment rate of interest other than 7 percent may be enforced if a party forfeits a claim that the interest rate exceeds the legal rate.

In this case, Navarra does not contend the City must pay a 10 percent rate because that is the rate specified in Code of Civil Procedure section 685.010. Nor does he seek to enforce the judgment under Title 9 of Part 2 of the Code of Civil Procedure. Instead, he seeks to recover postjudgment interest at a 10 percent rate because that is what the judgment specifies. As discussed above, that rate exceeds the legal rate and would have been subject to correction if an objection had been timely raised. However, the City cannot now assert the judgment is unenforceable to the extent it contains an incorrect interest rate when that claim of legal error was forfeited. The City has a mandatory, ministerial duty to pay the judgment, including interest calculated at a 10 percent rate as required by the judgment.

The City contends its research has not revealed a single case in which a public entity had been required to act in a manner contrary to law. It cites case law for the proposition that a writ may not issue “to compel an act which will tend to an unlawful purpose. [Citation.]” (Slater v. City Council (1965) 238 Cal.App.2d 864, 868.) However, there is nothing unlawful about requiring the City to pay a final judgment—even one containing legal error—after the time to appeal the judgment has passed. The situation here is no different from one in which a party forfeits a claim of error on appeal by failing to timely raise the issue. Indeed, that is precisely the situation here. In such a case, the party that forfeits the claim of error is bound to satisfy the judgment after it is final, even though it may contain legal error. A public entity is not given a “second bite at the apple” to challenge the error by claiming it would be unlawful to enforce a final judgment containing the error that has already been affirmed on appeal.

As a final note, we observe that we reach this conclusion reluctantly. It may seem unfair for Navarra to benefit from an error as to the proper rate of interest applied to a judgment against a local public entity. By virtue of our decision, he receives a windfall to which he would not be entitled if the City had timely sought to correct the error. It also may seem unfair to require taxpayers to shoulder the burden of this error. Because the judgment is final, however, the law compels us to conclude that the City has an obligation to pay the judgment according to its terms. The City had ample opportunity to notice the error and have it corrected before the judgment was final. It is too late to do so now.

Disposition

The judgment is affirmed. Navarra shall be entitled to recover his costs on appeal.

We concur: Siggins, J., Jenkins, J.


Summaries of

Navarra v. City of Oakland

California Court of Appeals, First District, Third Division
Mar 30, 2009
No. A121814 (Cal. Ct. App. Mar. 30, 2009)
Case details for

Navarra v. City of Oakland

Case Details

Full title:CARL J. NAVARRA, Plaintiff and Respondent, v. CITY OF OAKLAND, Defendant…

Court:California Court of Appeals, First District, Third Division

Date published: Mar 30, 2009

Citations

No. A121814 (Cal. Ct. App. Mar. 30, 2009)